Should Shareholders Reconsider Nurminen Logistics Oyj's (HEL:NLG1V) CEO Compensation Package?

Key Insights

• Nurminen Logistics Oyj will host its Annual General Meeting on 16th of April
• CEO Olli Pohjanvirta's total compensation includes salary of €863.0k
• The overall pay is 1,085% above the industry average
• Nurminen Logistics Oyj's EPS declined by 17% over the past three years while total shareholder loss over the past three years was 1.5%

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Shareholders will probably not be too impressed with the underwhelming results at Nurminen Logistics Oyj (HEL:NLG1V) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 16th of April. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. We present the case why we think CEO compensation is out of sync with company performance.

View our latest analysis for Nurminen Logistics Oyj

How Does Total Compensation For Olli Pohjanvirta Compare With Other Companies In The Industry?

At the time of writing, our data shows that Nurminen Logistics Oyj has a market capitalization of €80m, and reported total annual CEO compensation of €901k for the year to December 2024. We note that's an increase of 15% above last year. In particular, the salary of €863.0k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the Finland Logistics industry with market capitalizations below €183m, reported a median total CEO compensation of €76k. Accordingly, our analysis reveals that Nurminen Logistics Oyj pays Olli Pohjanvirta north of the industry median. Moreover, Olli Pohjanvirta also holds €1.3m worth of Nurminen Logistics Oyj stock directly under their own name.

Component	2024	2023	Proportion (2024)
Salary	€863k	€755k	96%
Other	€38k	€30k	4%
Total Compensation	€901k	€785k	100%

On an industry level, roughly 59% of total compensation represents salary and 41% is other remuneration. Nurminen Logistics Oyj pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. 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.

A Look at Nurminen Logistics Oyj's Growth Numbers

Over the last three years, Nurminen Logistics Oyj has shrunk its earnings per share by 17% per year. Its revenue is down 18% over the previous year.

The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Nurminen Logistics Oyj Been A Good Investment?

Given the total shareholder loss of 1.5% over three years, many shareholders in Nurminen Logistics Oyj are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Olli receives almost all of their compensation through a salary. Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 4 warning signs for Nurminen Logistics Oyj that investors should think about before committing capital to this stock.

Important note: Nurminen Logistics Oyj is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.