Increases to CEO Compensation Might Be Put On Hold For Now at Qt Group Oyj (HEL:QTCOM)

Key Insights

• Qt Group Oyj's Annual General Meeting to take place on 14th of March
• Salary of €381.6k is part of CEO Juha Varelius's total remuneration
• The total compensation is 806% higher than the average for the industry
• Qt Group Oyj's EPS grew by 65% over the past three years while total shareholder return over the past three years was 276%

Performance at Qt Group Oyj (HEL:QTCOM) has been reasonably good and CEO Juha Varelius has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 14th of March, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still want to keep CEO compensation within reason.

View our latest analysis for Qt Group Oyj

Comparing Qt Group Oyj's CEO Compensation With The Industry

At the time of writing, our data shows that Qt Group Oyj has a market capitalization of €1.8b, and reported total annual CEO compensation of €16m for the year to December 2022. Notably, that's a decrease of 42% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at €382k.

On comparing similar companies from the Finnish Software industry with market caps ranging from €946m to €3.0b, we found that the median CEO total compensation was €1.8m. Accordingly, our analysis reveals that Qt Group Oyj pays Juha Varelius north of the industry median. Furthermore, Juha Varelius directly owns €23m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2022	2021	Proportion (2022)
Salary	€382k	€354k	2%
Other	€16m	€27m	98%
Total Compensation	€16m	€27m	100%

On an industry level, roughly 82% of total compensation represents salary and 18% is other remuneration. A high-salary is usually a no-brainer when it comes to attracting the best executives, but Qt Group Oyj paid Juha Varelius a nominal salary to the CEO over the past 12 months, instead focusing on non-salary compensation. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Qt Group Oyj's Growth

Over the past three years, Qt Group Oyj has seen its earnings per share (EPS) grow by 65% per year. In the last year, its revenue is up 28%.

Shareholders would be glad to know that the company has improved itself over the last few years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Qt Group Oyj Been A Good Investment?

Most shareholders would probably be pleased with Qt Group Oyj for providing a total return of 276% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

Qt Group Oyj primarily uses non-salary benefits to reward its CEO. Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 3 warning signs for Qt Group Oyj (2 shouldn't be ignored!) that you should be aware of before investing here.

Switching gears from Qt Group 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.