How Should Investors Feel About Sievi Capital Oyj's (HEL:SIEVI) CEO Remuneration?

Paivi Marttila has been the CEO of Sievi Capital Oyj (HEL:SIEVI) since 2018, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Sievi Capital Oyj pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

See our latest analysis for Sievi Capital Oyj

How Does Total Compensation For Paivi Marttila Compare With Other Companies In The Industry?

Our data indicates that Sievi Capital Oyj has a market capitalization of €59m, and total annual CEO compensation was reported as €219k for the year to December 2019. We note that's an increase of 17% above last year. It is worth noting that the CEO compensation consists entirely of the salary, worth €219k.

In comparison with other companies in the industry with market capitalizations under €169m, the reported median total CEO compensation was €180k. From this we gather that Paivi Marttila is paid around the median for CEOs in the industry.

Speaking on an industry level, nearly 58% of total compensation represents salary, while the remainder of 42% is other remuneration. On a company level, Sievi Capital Oyj prefers to reward its CEO through a salary, opting not to pay Paivi Marttila through non-salary benefits. 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.

Sievi Capital Oyj's Growth

Over the last three years, Sievi Capital Oyj has shrunk its earnings per share by 16% per year. It saw its revenue drop 15% over the last year.

The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Sievi Capital Oyj Been A Good Investment?

Given the total shareholder loss of 21% over three years, many shareholders in Sievi Capital Oyj are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Sievi Capital Oyj pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. As we noted earlier, Sievi Capital Oyj pays its CEO in line with similar-sized companies belonging to the same industry. On the other hand, EPS growth and total shareholder return have been negative for the last three years. We'd stop short of saying compensation is inappropriate, but we would understand if shareholders had questions regarding a future raise.

CEO compensation can have a massive impact on performance, but it's just one element. We've identified 2 warning signs for Sievi Capital Oyj that investors should be aware of in a dynamic business environment.

Switching gears from Sievi Capital Oyj, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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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