Cegedim SA's (EPA:CGM) CEO Will Probably Struggle To See A Pay Rise This Year

Key Insights

• Cegedim will host its Annual General Meeting on 24th of June
• CEO Jean-Claude Labrune's total compensation includes salary of €260.0k
• Total compensation is 61% below industry average
• Cegedim's EPS declined by 45% over the past three years while total shareholder loss over the past three years was 46%

The underwhelming performance at Cegedim SA (EPA:CGM) recently has probably not pleased shareholders. There is an opportunity for shareholders to influence management to turn the performance around by voting on resolutions such as executive remuneration at the AGM coming up on 24th of June. The data we gathered below shows that CEO compensation looks acceptable for now.

Check out our latest analysis for Cegedim

Comparing Cegedim SA's CEO Compensation With The Industry

According to our data, Cegedim SA has a market capitalization of €177m, and paid its CEO total annual compensation worth €274k over the year to December 2023. This was the same as last year. We note that the salary portion, which stands at €260.0k constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the France Healthcare Services industry with market capitalizations ranging between €93m and €373m had a median total CEO compensation of €702k. This suggests that Jean-Claude Labrune is paid below the industry median. Furthermore, Jean-Claude Labrune directly owns €137k worth of shares in the company.

Component	2023	2022	Proportion (2023)
Salary	€260k	€260k	95%
Other	€14k	€14k	5%
Total Compensation	€274k	€274k	100%

Talking in terms of the industry, salary represented approximately 66% of total compensation out of all the companies we analyzed, while other remuneration made up 34% of the pie. According to our research, Cegedim has allocated a higher percentage of pay to salary in comparison to the wider industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Cegedim SA's Growth

Cegedim SA has reduced its earnings per share by 45% a year over the last three years. In the last year, its revenue is up 11%.

Overall this is not a very positive result for shareholders. And while it's good to see some good revenue growth recently, the growth isn't really fast enough for us to put aside my concerns around EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Cegedim SA Been A Good Investment?

Few Cegedim SA shareholders would feel satisfied with the return of -46% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

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.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 1 warning sign for Cegedim that investors should look into moving forward.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com