Stock Analysis

How Much is Ringkjøbing Landbobank's (CPH:RILBA) CEO Getting Paid?

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This article will reflect on the compensation paid to John Fisker who has served as CEO of Ringkjøbing Landbobank A/S (CPH:RILBA) since 2012. This analysis will also assess whether Ringkjøbing Landbobank pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Check out our latest analysis for Ringkjøbing Landbobank

How Does Total Compensation For John Fisker Compare With Other Companies In The Industry?

According to our data, Ringkjøbing Landbobank A/S has a market capitalization of kr.17b, and paid its CEO total annual compensation worth kr.6.6m over the year to December 2020. That's a modest increase of 4.6% on the prior year. We note that the salary portion, which stands at kr.5.16m constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations ranging from kr.12b to kr.39b, the reported median CEO total compensation was kr.6.6m. So it looks like Ringkjøbing Landbobank compensates John Fisker in line with the median for the industry. What's more, John Fisker holds kr.45m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component20202019Proportion (2020)
Salary kr.5.2m kr.4.9m 79%
Other kr.1.4m kr.1.4m 21%
Total Compensationkr.6.6m kr.6.3m100%

Talking in terms of the industry, salary represented approximately 88% of total compensation out of all the companies we analyzed, while other remuneration made up 12% of the pie. Ringkjøbing Landbobank sets aside a smaller share of compensation for salary, in comparison to the overall industry. 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.

CPSE:RILBA CEO Compensation February 15th 2021

A Look at Ringkjøbing Landbobank A/S' Growth Numbers

Over the past three years, Ringkjøbing Landbobank A/S has seen its earnings per share (EPS) grow by 6.6% per year. It saw its revenue drop 5.1% over the last year.

We would prefer it if there was revenue growth, but the modest EPSgrowth gives us some relief. It's hard to reach a conclusion about business performance right now. This may be one to watch. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Ringkjøbing Landbobank A/S Been A Good Investment?

We think that the total shareholder return of 93%, over three years, would leave most Ringkjøbing Landbobank A/S shareholders smiling. 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...

As we touched on above, Ringkjøbing Landbobank A/S is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. But the business isn't reporting great numbers in terms of EPS growth. Meanwhile, shareholder returns have remained positive over the same time frame. We would like to see EPS growth from the business, although we wouldn't say the CEO compensation is high.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 1 warning sign for Ringkjøbing Landbobank that investors should be aware of in a dynamic business environment.

Important note: Ringkjøbing Landbobank is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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