We Think Shareholders Are Less Likely To Approve A Large Pay Rise For artnet AG's (ETR:ART) CEO For Now

By
Simply Wall St
Published
September 22, 2021
XTRA:ART
Source: Shutterstock

Performance at artnet AG (ETR:ART) has been reasonably good and CEO Jacob Pabst has done a decent job of steering the company in the right direction. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 29 September 2021. However, some shareholders may still want to keep CEO compensation within reason.

View our latest analysis for artnet

How Does Total Compensation For Jacob Pabst Compare With Other Companies In The Industry?

Our data indicates that artnet AG has a market capitalization of €59m, and total annual CEO compensation was reported as €400k for the year to December 2020. This means that the compensation hasn't changed much from last year. In particular, the salary of €394.8k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the industry with market capitalizations below €170m, we found that the median total CEO compensation was €307k. Accordingly, our analysis reveals that artnet AG pays Jacob Pabst north of the industry median.

Component20202019Proportion (2020)
Salary €395k €368k 99%
Other €5.4k €42k 1%
Total Compensation€400k €411k100%

Speaking on an industry level, nearly 61% of total compensation represents salary, while the remainder of 39% is other remuneration. artnet pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

ceo-compensation
XTRA:ART CEO Compensation September 23rd 2021

A Look at artnet AG's Growth Numbers

Over the past three years, artnet AG has seen its earnings per share (EPS) grow by 2.3% per year. Revenue was pretty flat on last year.

We're not particularly impressed by the revenue growth, but the modest improvement in EPS is good. So there are some positives here, but not enough to earn high praise. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has artnet AG Been A Good Investment?

Most shareholders would probably be pleased with artnet AG for providing a total return of 178% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

artnet pays its CEO a majority of compensation through a salary. Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 2 warning signs for artnet that investors should look into moving forward.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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