We Think Shareholders Are Less Likely To Approve A Large Pay Rise For NKT A/S' (CPH:NKT) CEO For Now

Performance at NKT A/S (CPH:NKT) has been reasonably good and CEO Alexander Kara has done a decent job of steering the company in the right direction. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 24 March 2022. However, some shareholders may still want to keep CEO compensation within reason.

Check out our latest analysis for NKT

Comparing NKT A/S' CEO Compensation With the industry

According to our data, NKT A/S has a market capitalization of kr.13b, and paid its CEO total annual compensation worth €2.2m over the year to December 2021. Notably, that's an increase of 21% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at €896k.

In comparison with other companies in the industry with market capitalizations ranging from kr.6.7b to kr.21b, the reported median CEO total compensation was €1.1m. Accordingly, our analysis reveals that NKT A/S pays Alexander Kara north of the industry median. Moreover, Alexander Kara also holds kr.5.9m worth of NKT stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2021	2020	Proportion (2021)
Salary	€896k	€805k	40%
Other	€1.3m	€1.0m	60%
Total Compensation	€2.2m	€1.8m	100%

Talking in terms of the broader industry, salary and other compensation roughly make up 50% each, of the total compensation. It's interesting to note that NKT allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at NKT A/S' Growth Numbers

NKT A/S's earnings per share (EPS) grew 34% per year over the last three years. It achieved revenue growth of 29% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has NKT A/S Been A Good Investment?

We think that the total shareholder return of 181%, over three years, would leave most NKT A/S shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay 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 one thing, but it is also interesting to check if the CEO is buying or selling NKT (free visualization of insider trades).

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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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.