Shareholders Will Probably Hold Off On Increasing FBD Holdings plc's (ISE:EG7) CEO Compensation For The Time Being

Key Insights

• FBD Holdings will host its Annual General Meeting on 8th of May
• Salary of €555.0k is part of CEO Tomas O'Midheach's total remuneration
• The overall pay is 40% above the industry average
• Over the past three years, FBD Holdings' EPS fell by 12% and over the past three years, the total shareholder return was 92%

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Despite strong share price growth of 92% for FBD Holdings plc (ISE:EG7) over the last few years, earnings growth has been disappointing, which suggests something is amiss. These concerns will be at the front of shareholders' minds as they go into the AGM coming up on 8th of May. It would also be an opportunity for them to influence management through exercising their voting power on company resolutions, including CEO and executive remuneration, which could impact on firm performance in the future. In our analysis below, we show why shareholders may consider holding off a raise for the CEO's compensation until company performance improves.

See our latest analysis for FBD Holdings

How Does Total Compensation For Tomas O'Midheach Compare With Other Companies In The Industry?

At the time of writing, our data shows that FBD Holdings plc has a market capitalization of €465m, and reported total annual CEO compensation of €2.1m for the year to December 2024. That's a notable increase of 80% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at €555k.

On comparing similar companies from the Ireland Insurance industry with market caps ranging from €177m to €709m, we found that the median CEO total compensation was €1.5m. Hence, we can conclude that Tomas O'Midheach is remunerated higher than the industry median. What's more, Tomas O'Midheach holds €1.4m worth of shares in the company in their own name.

Component	2024	2023	Proportion (2024)
Salary	€555k	€530k	27%
Other	€1.5m	€626k	73%
Total Compensation	€2.1m	€1.2m	100%

Talking in terms of the industry, salary represented approximately 40% of total compensation out of all the companies we analyzed, while other remuneration made up 60% of the pie. FBD Holdings pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

FBD Holdings plc's Growth

Over the last three years, FBD Holdings plc has shrunk its earnings per share by 12% per year. It achieved revenue growth of 10% over the last year.

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. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 FBD Holdings plc Been A Good Investment?

Most shareholders would probably be pleased with FBD Holdings plc for providing a total return of 92% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

While the return to shareholders does look promising, it's hard to ignore the lack of earnings growth and this makes us question whether these strong returns will continue. The upcoming AGM will provide shareholders the opportunity to revisit the company’s remuneration policies and evaluate if the board’s judgement and decision-making is aligned with that of the company’s shareholders.

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 did our research and identified 2 warning signs (and 1 which is concerning) in FBD Holdings we think you should know about.

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.

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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.