Most Shareholders Will Probably Find That The CEO Compensation For ACEA S.p.A. (BIT:ACE) Is Reasonable

Key Insights

• ACEA will host its Annual General Meeting on 28th of April
• Total pay for CEO Fabrizio Palermo includes €775.0k salary
• The overall pay is comparable to the industry average
• ACEA's EPS grew by 1.9% over the past three years while total shareholder return over the past three years was 40%

Our free stock report includes 1 warning sign investors should be aware of before investing in ACEA. Read for free now.

Performance at ACEA S.p.A. (BIT:ACE) has been reasonably good and CEO Fabrizio Palermo has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 28th of April, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. Here is our take on why we think the CEO compensation looks appropriate.

See our latest analysis for ACEA

How Does Total Compensation For Fabrizio Palermo Compare With Other Companies In The Industry?

Our data indicates that ACEA S.p.A. has a market capitalization of €4.2b, and total annual CEO compensation was reported as €1.3m for the year to December 2024. We note that's a decrease of 14% compared to last year. Notably, the salary which is €775.0k, represents a considerable chunk of the total compensation being paid.

For comparison, other companies in the Italy Integrated Utilities industry with market capitalizations ranging between €1.7b and €5.6b had a median total CEO compensation of €1.5m. This suggests that ACEA remunerates its CEO largely in line with the industry average.

Component	2024	2023	Proportion (2024)
Salary	€775k	€1.0m	60%
Other	€521k	€487k	40%
Total Compensation	€1.3m	€1.5m	100%

On an industry level, roughly 29% of total compensation represents salary and 71% is other remuneration. ACEA pays out 60% of remuneration in the form of a salary, significantly higher than the industry average. 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 ACEA S.p.A.'s Growth Numbers

ACEA S.p.A.'s earnings per share (EPS) grew 1.9% per year over the last three years. In the last year, its revenue is down 8.8%.

We would prefer it if there was revenue growth, but it is good to see a modest EPS growth at least. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

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

Most shareholders would probably be pleased with ACEA S.p.A. for providing a total return of 40% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, we still think that any proposed increase in CEO compensation will be examined closely to make sure the compensation is appropriate and linked to performance.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 1 warning sign for ACEA that investors should be aware of in a dynamic business environment.

Switching gears from ACEA, 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.