Here's Why Shareholders Should Examine Tesmec S.p.A.'s (BIT:TES) CEO Compensation Package More Closely

Key Insights

• Tesmec to hold its Annual General Meeting on 30th of April
• Salary of €460.0k is part of CEO Ambrogio Dominioni's total remuneration
• Total compensation is 45% above industry average
• Tesmec's EPS declined by 96% over the past three years while total shareholder loss over the past three years was 59%

Our free stock report includes 2 warning signs investors should be aware of before investing in Tesmec. Read for free now.

Shareholders will probably not be too impressed with the underwhelming results at Tesmec S.p.A. (BIT:TES) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 30th of April. 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. The data we present below explains why we think CEO compensation is not consistent with recent performance.

View our latest analysis for Tesmec

How Does Total Compensation For Ambrogio Dominioni Compare With Other Companies In The Industry?

At the time of writing, our data shows that Tesmec S.p.A. has a market capitalization of €33m, and reported total annual CEO compensation of €460k for the year to December 2024. This was the same amount the CEO received in the prior year. Notably, the salary of €460k is the entirety of the CEO compensation.

For comparison, other companies in the Italian Machinery industry with market capitalizations below €177m, reported a median total CEO compensation of €318k. Hence, we can conclude that Ambrogio Dominioni is remunerated higher than the industry median. What's more, Ambrogio Dominioni holds €51k worth of shares in the company in their own name.

Component	2024	2023	Proportion (2024)
Salary	€460k	€460k	100%
Other	-	-	-
Total Compensation	€460k	€460k	100%

Speaking on an industry level, nearly 53% of total compensation represents salary, while the remainder of 47% is other remuneration. Speaking on a company level, Tesmec prefers to tread along a traditional path, disbursing all compensation through a salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Tesmec S.p.A.'s Growth

Over the last three years, Tesmec S.p.A. has shrunk its earnings per share by 96% per year. In the last year, its revenue is up 1.5%.

Overall this is not a very positive result for shareholders. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Tesmec S.p.A. Been A Good Investment?

With a total shareholder return of -59% over three years, Tesmec S.p.A. shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Tesmec pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

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. That's why we did our research, and identified 2 warning signs for Tesmec (of which 1 is significant!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from Tesmec, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.