Thierry de La d'Artaise became the CEO of SEB SA (EPA:SK) in 2000, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for SEB.
See our latest analysis for SEB
Comparing SEB SA's CEO Compensation With the industry
Our data indicates that SEB SA has a market capitalization of ā¬7.5b, and total annual CEO compensation was reported as ā¬5.0m for the year to December 2019. That is, the compensation was roughly the same as last year. We think total compensation is more important but our data shows that the CEO salary is lower, at ā¬1.0m.
On examining similar-sized companies in the industry with market capitalizations between ā¬3.3b and ā¬10b, we discovered that the median CEO total compensation of that group was ā¬3.2m. This suggests that Thierry de La d'Artaise is paid more than the median for the industry. What's more, Thierry de La d'Artaise holds ā¬82m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
| Component | 2019 | 2018 | Proportion (2019) |
| Salary | ā¬1.0m | ā¬900k | 20% |
| Other | ā¬4.0m | ā¬3.9m | 80% |
| Total Compensation | ā¬5.0m | ā¬4.8m | 100% |
On an industry level, around 84% of total compensation represents salary and 16% is other remuneration. SEB sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.
A Look at SEB SA's Growth Numbers
Earnings per share at SEB SA are much the same as they were three years ago, albeit slightly lower. It saw its revenue drop 2.7% over the last year.
Its a bit disappointing to see that the company has failed to grow its EPS. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation 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 SEB SA Been A Good Investment?
With a total shareholder return of 1.5% over three years, SEB SA has done okay by shareholders. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
To Conclude...
As previously discussed, Thierry de La is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Unfortunately, EPS has not grown in three years, failing to impress us. While shareholder returns are acceptable, they don't delight. So you can understand why we do not think CEO compensation is particularly modest!
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We did our research and spotted 2 warning signs for SEB that investors should look into moving forward.
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. 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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About ENXTPA:SK
SEB
Designs, manufactures, and markets small domestic equipment worldwide.
Undervalued with solid track record and pays a dividend.
