Does Adocia SA's (EPA:ADOC) CEO Pay Reflect Performance?

In 2011 Gérard Soula was appointed CEO of Adocia SA (EPA:ADOC). First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Adocia

How Does Gérard Soula's Compensation Compare With Similar Sized Companies?

Our data indicates that Adocia SA is worth €88m, and total annual CEO compensation was reported as €583k for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at €350k. We examined a group of similar sized companies, with market capitalizations of below €184m. The median CEO total compensation in that group is €281k.

It would therefore appear that Adocia SA pays Gérard Soula more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.

The graphic below shows how CEO compensation at Adocia has changed from year to year.

Is Adocia SA Growing?

Over the last three years Adocia SA has shrunk its earnings per share by an average of 24% per year (measured with a line of best fit). It saw its revenue drop 44% over the last year.

Sadly for shareholders, earnings per share are actually down, over three years. 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. You might want to check this free visual report on analyst forecasts for future earnings.

Has Adocia SA Been A Good Investment?

With a three year total loss of 40%, Adocia SA would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We compared total CEO remuneration at Adocia SA with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.

Neither earnings per share nor revenue have been growing sufficiently to impress us, over the last three years. Arguably worse, investors are without a positive return for the last three years. This analysis suggests to us that the CEO is paid too generously! Whatever your view on compensation, you might want to check if insiders are buying or selling Adocia shares (free trial).

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.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

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