How Should Investors Feel About Alm. Brand A/S’s (CPH:ALMB) CEO Pay?

In 2001 Søren Mortensen was appointed CEO of Alm. Brand A/S (CPH:ALMB). First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.

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How Does Søren Mortensen’s Compensation Compare With Similar Sized Companies?

Our data indicates that Alm. Brand A/S is worth ø9.3b, and total annual CEO compensation is ø8.3m. (This number is for the twelve months until 2015). While we always look at total compensation first, we note that the salary component is less, at ø5.8m. When we examined a selection of companies with market caps ranging from ø6.5b to ø21b, we found the median CEO compensation was ø10m.

So Søren Mortensen receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see, below, how CEO compensation at Alm. Brand has changed over time.

CPSE:ALMB CEO Compensation January 31st 19
CPSE:ALMB CEO Compensation January 31st 19

Is Alm. Brand A/S Growing?

Alm. Brand A/S has increased its earnings per share (EPS) by an average of 11% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 5.7%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s nice to see a little revenue growth, as this is consistent with healthy business conditions.

It could be important to check this free visual depiction of what analysts expect for the future.

Has Alm. Brand A/S Been A Good Investment?

I think that the total shareholder return of 49%, over three years, would leave most Alm. Brand 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.

In Summary…

Søren Mortensen is paid around what is normal the leaders of comparable size companies.

Shareholders would surely be happy to see that shareholder returns have been great, and the earnings per share are up. Indeed, many might consider the pay rather modest, given the solid company performance! Shareholders may want to check for free if Alm. Brand insiders are buying or selling shares.

Or you might prefer examine intently this intuitive graph showing past earnings and revenue.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.