We Think Shaniv Paper Industry Ltd's (TLV:SHAN) CEO Compensation Package Needs To Be Put Under A Microscope

Key Insights

• Shaniv Paper Industry's Annual General Meeting to take place on 23rd of September
• Salary of ₪1.45m is part of CEO Pesach Bernat's total remuneration
• The total compensation is 613% higher than the average for the industry
• Over the past three years, Shaniv Paper Industry's EPS fell by 19% and over the past three years, the total loss to shareholders 35%

Shaniv Paper Industry Ltd (TLV:SHAN) has not performed well recently and CEO Pesach Bernat will probably need to up their game. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 23rd of September. 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. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Check out our latest analysis for Shaniv Paper Industry

How Does Total Compensation For Pesach Bernat Compare With Other Companies In The Industry?

According to our data, Shaniv Paper Industry Ltd has a market capitalization of ₪218m, and paid its CEO total annual compensation worth ₪3.1m over the year to December 2023. That's a notable increase of 30% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at ₪1.5m.

In comparison with other companies in the Israel Forestry industry with market capitalizations under ₪750m, the reported median total CEO compensation was ₪433k. This suggests that Pesach Bernat is paid more than the median for the industry. What's more, Pesach Bernat holds ₪10m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	₪1.5m	₪1.3m	47%
Other	₪1.6m	₪1.1m	53%
Total Compensation	₪3.1m	₪2.4m	100%

Speaking on an industry level, nearly 83% of total compensation represents salary, while the remainder of 17% is other remuneration. It's interesting to note that Shaniv Paper Industry allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at Shaniv Paper Industry Ltd's Growth Numbers

Over the last three years, Shaniv Paper Industry Ltd has shrunk its earnings per share by 19% per year. In the last year, its revenue is up 3.1%.

Overall this is not a very positive result for shareholders. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Shaniv Paper Industry Ltd Been A Good Investment?

The return of -35% over three years would not have pleased Shaniv Paper Industry Ltd shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. 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 pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 4 warning signs (and 1 which is a bit concerning) in Shaniv Paper Industry we think you should know about.

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. 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.