It May Be Possible That Aeffe S.p.A.'s (BIT:AEF) CEO Compensation Could Get Bumped Up

Key Insights

• Aeffe will host its Annual General Meeting on 27th of April
• Salary of €250.0k is part of CEO Simone Badioli's total remuneration
• The overall pay is 46% below the industry average
• Over the past three years, Aeffe's EPS grew by 13% and over the past three years, the total shareholder return was 26%

Shareholders will be pleased by the robust performance of Aeffe S.p.A. (BIT:AEF) recently and this will be kept in mind in the upcoming AGM on 27th of April. They will probably be more interested in hearing the board discuss future initiatives to further improve the business as they vote on resolutions such as executive remuneration. Here is our take on why we think CEO compensation is fair and may even warrant a raise.

See our latest analysis for Aeffe

How Does Total Compensation For Simone Badioli Compare With Other Companies In The Industry?

According to our data, Aeffe S.p.A. has a market capitalization of €128m, and paid its CEO total annual compensation worth €255k over the year to December 2022. That is, the compensation was roughly the same as last year. In particular, the salary of €250.0k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Italian Luxury industry with market capitalizations under €182m, the reported median total CEO compensation was €473k. This suggests that Simone Badioli is paid below the industry median.

On an industry level, roughly 78% of total compensation represents salary and 22% is other remuneration. Aeffe pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at Aeffe S.p.A.'s Growth Numbers

Aeffe S.p.A.'s earnings per share (EPS) grew 13% per year over the last three years. Its revenue is up 9.1% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

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

Aeffe S.p.A. has served shareholders reasonably well, with a total return of 26% over three years. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

Simone receives almost all of their compensation through a salary. While the company seems to be headed in the right direction performance-wise, there's always room for improvement. If it continues on the same road, shareholders might feel even more confident about their investment, and have little to no objections concerning CEO pay. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 2 warning signs for Aeffe (of which 1 is significant!) that you should know about in order to have a holistic understanding of the stock.

Important note: Aeffe is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.