Here's Why AS LHV Group's (TAL:LHV1T) CEO May Deserve A Raise

Key Insights

• AS LHV Group's Annual General Meeting to take place on 20th of March
• Salary of €192.0k is part of CEO Madis Toomsalu's total remuneration
• The total compensation is 30% less than the average for the industry
• Over the past three years, AS LHV Group's EPS grew by 49% and over the past three years, the total shareholder return was 59%

The impressive results at AS LHV Group (TAL:LHV1T) recently will be great news for shareholders. This would be kept in mind at the upcoming AGM on 20th of March which will be a chance for them to hear the board review the financial results, discuss future company strategy and vote on resolutions such as executive remuneration and other matters. We think the CEO has done a pretty decent job and probably deserves a well-earned pay rise.

See our latest analysis for AS LHV Group

Comparing AS LHV Group's CEO Compensation With The Industry

According to our data, AS LHV Group has a market capitalization of €1.1b, and paid its CEO total annual compensation worth €576k over the year to December 2023. That's a notable increase of 15% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at €192k.

On examining similar-sized companies in the Europe Banks industry with market capitalizations between €914m and €2.9b, we discovered that the median CEO total compensation of that group was €827k. This suggests that Madis Toomsalu is paid below the industry median. What's more, Madis Toomsalu holds €4.3m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	€192k	€189k	33%
Other	€384k	€312k	67%
Total Compensation	€576k	€501k	100%

On an industry level, around 65% of total compensation represents salary and 35% is other remuneration. AS LHV Group pays a modest slice of remuneration through salary, as compared to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

AS LHV Group's Growth

Over the past three years, AS LHV Group has seen its earnings per share (EPS) grow by 49% per year. Its revenue is up 75% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has AS LHV Group Been A Good Investment?

Boasting a total shareholder return of 59% over three years, AS LHV Group has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

Whatever your view on compensation, you might want to check if insiders are buying or selling AS LHV Group shares (free trial).

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.