Increases to CEO Compensation Might Be Put On Hold For Now at Tryg A/S (CPH:TRYG)

Simply Wall St
March 19, 2021
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CEO Morten Hubbe has done a decent job of delivering relatively good performance at Tryg A/S (CPH:TRYG) recently. As shareholders go into the upcoming AGM on 26 March 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for Tryg

How Does Total Compensation For Morten Hubbe Compare With Other Companies In The Industry?

According to our data, Tryg A/S has a market capitalization of kr.44b, and paid its CEO total annual compensation worth kr.21m over the year to December 2020. That's a notable increase of 44% on last year. We note that the salary of kr.11.8m makes up a sizeable portion of the total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations ranging from kr.25b to kr.75b, the reported median CEO total compensation was kr.15m. This suggests that Morten Hubbe is paid more than the median for the industry. Moreover, Morten Hubbe also holds kr.34m worth of Tryg stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component20202019Proportion (2020)
Salary kr.12m kr.11m 57%
Other kr.9.0m kr.3.1m 43%
Total Compensationkr.21m kr.14m100%

On an industry level, roughly 45% of total compensation represents salary and 55% is other remuneration. Tryg is paying a higher share of its remuneration through a 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:TRYG CEO Compensation March 20th 2021

A Look at Tryg A/S' Growth Numbers

Earnings per share at Tryg A/S are much the same as they were three years ago, albeit with slightly higher. Its revenue is up 2.2% over the 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. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Tryg A/S Been A Good Investment?

We think that the total shareholder return of 53%, over three years, would leave most Tryg 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...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 3 warning signs for Tryg that you should be aware of before investing.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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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