Here's Why It's Unlikely That Metsä Board Oyj's (HEL:METSB) CEO Will See A Pay Rise This Year

Key Insights

• Metsä Board Oyj to hold its Annual General Meeting on 26th of March
• Salary of €545.2k is part of CEO Mika Joukio's total remuneration
• The total compensation is similar to the average for the industry
• Metsä Board Oyj's EPS declined by 18% over the past three years while total shareholder loss over the past three years was 12%

The results at Metsä Board Oyj (HEL:METSB) have been quite disappointing recently and CEO Mika Joukio bears some responsibility for this. At the upcoming AGM on 26th of March, shareholders can hear from the board including their plans for turning around performance. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Check out our latest analysis for Metsä Board Oyj

How Does Total Compensation For Mika Joukio Compare With Other Companies In The Industry?

At the time of writing, our data shows that Metsä Board Oyj has a market capitalization of €2.6b, and reported total annual CEO compensation of €2.9m for the year to December 2023. Notably, that's an increase of 16% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at €545k.

On comparing similar companies from the Finland Packaging industry with market caps ranging from €1.8b to €5.9b, we found that the median CEO total compensation was €3.4m. So it looks like Metsä Board Oyj compensates Mika Joukio in line with the median for the industry. Furthermore, Mika Joukio directly owns €2.3m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	€545k	€536k	19%
Other	€2.3m	€1.9m	81%
Total Compensation	€2.9m	€2.5m	100%

Speaking on an industry level, nearly 44% of total compensation represents salary, while the remainder of 56% is other remuneration. Metsä Board Oyj pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Metsä Board Oyj's Growth

Over the last three years, Metsä Board Oyj has shrunk its earnings per share by 18% per year. It saw its revenue drop 22% over the last year.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Metsä Board Oyj Been A Good Investment?

With a three year total loss of 12% for the shareholders, Metsä Board Oyj would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 3 warning signs for Metsä Board Oyj that investors should look into moving forward.

Switching gears from Metsä Board 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. 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.