How Does Chr. Hansen Holding's (CPH:CHR) CEO Salary Compare to Peers?

Mauricio Graber became the CEO of Chr. Hansen Holding A/S (CPH:CHR) in 2018, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Chr. Hansen Holding pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Chr. Hansen Holding

Comparing Chr. Hansen Holding A/S' CEO Compensation With the industry

According to our data, Chr. Hansen Holding A/S has a market capitalization of kr.80b, and paid its CEO total annual compensation worth €3.4m over the year to August 2020. That's a notable increase of 8.6% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at €969k.

On comparing similar companies in the industry with market capitalizations above kr.50b, we found that the median total CEO compensation was €3.8m. From this we gather that Mauricio Graber is paid around the median for CEOs in the industry. What's more, Mauricio Graber holds kr.13m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Talking in terms of the industry, salary represented approximately 59% of total compensation out of all the companies we analyzed, while other remuneration made up 41% of the pie. It's interesting to note that Chr. Hansen Holding 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 Chr. Hansen Holding A/S' Growth Numbers

Over the past three years, Chr. Hansen Holding A/S has seen its earnings per share (EPS) grow by 1.0% per year. Its revenue is up 3.2% over the last year.

We'd prefer higher revenue growth, but we're happy with the modest EPS growth. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Chr. Hansen Holding A/S Been A Good Investment?

Chr. Hansen Holding A/S has generated a total shareholder return of 16% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

To Conclude...

As we touched on above, Chr. Hansen Holding 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. On the other hand, EPS and shareholder returns have been stable over the last three years, but have not grown substantially. So, although the CEO compensation seems reasonable, shareholders might want to see some further progress before they agree that Mauricio should get a raise.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Chr. Hansen Holding that you should be aware of before investing.

Important note: Chr. Hansen Holding 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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