Here's Why cBrain A/S' (CPH:CBRAIN) CEO Compensation Is The Least Of Shareholders Concerns

Key Insights

• cBrain to hold its Annual General Meeting on 29th of April
• Salary of kr.2.22m is part of CEO Per Knudsen's total remuneration
• Total compensation is 51% below industry average
• Over the past three years, cBrain's EPS grew by 28% and over the past three years, the total loss to shareholders 29%

We've discovered 1 warning sign about cBrain. View them for free.

Shareholders may be wondering what CEO Per Knudsen plans to do to improve the less than great performance at cBrain A/S (CPH:CBRAIN) recently. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 29th of April. It has been shown that setting appropriate executive remuneration incentivises the management to act in the interests of shareholders. We have prepared some analysis below to show that CEO compensation looks to be reasonable.

Check out our latest analysis for cBrain

Comparing cBrain A/S' CEO Compensation With The Industry

According to our data, cBrain A/S has a market capitalization of kr.3.0b, and paid its CEO total annual compensation worth kr.3.2m over the year to December 2024. This means that the compensation hasn't changed much from last year. Notably, the salary which is kr.2.22m, represents most of the total compensation being paid.

On comparing similar companies from the Denmark Software industry with market caps ranging from kr.1.3b to kr.5.2b, we found that the median CEO total compensation was kr.6.5m. In other words, cBrain pays its CEO lower than the industry median.

Component	2024	2023	Proportion (2024)
Salary	kr.2.2m	kr.2.1m	70%
Other	kr.947k	kr.965k	30%
Total Compensation	kr.3.2m	kr.3.1m	100%

Speaking on an industry level, nearly 72% of total compensation represents salary, while the remainder of 28% is other remuneration. Although there is a difference in how total compensation is set, cBrain more or less reflects the market in terms of setting the salary. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

cBrain A/S' Growth

cBrain A/S has seen its earnings per share (EPS) increase by 28% a year over the past three years. Its revenue is up 12% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has cBrain A/S Been A Good Investment?

With a three year total loss of 29% for the shareholders, cBrain A/S would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

The fact that shareholders have earned a negative share price return is certainly disconcerting. This contrasts to the strong EPS growth recently however, and suggests that there may be other factors at play driving down the share price. A key question may be why the fundamentals have not yet been reflected into the share price. In the upcoming AGM, shareholders should take this opportunity to raise these concerns with the board and revisit their investment thesis with regards to the company.

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 cBrain that investors should be aware of in a dynamic business environment.

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.