This Is Why Shareholders May Want To Hold Back On A Pay Rise For Sligro Food Group N.V.'s (AMS:SLIGR) CEO

Performance at Sligro Food Group N.V. (AMS:SLIGR) has not been particularly rosy recently and shareholders will likely be holding CEO Koen Slippens and the board accountable for this. The next AGM coming up on 24 March 2021 will be a chance for shareholders to have their concerns addressed by the board, challenge management on company strategy and vote on resolutions such as executive remuneration, which may help change the company's future prospects. The data we gathered below shows that CEO compensation looks acceptable for now.

Check out our latest analysis for Sligro Food Group

Comparing Sligro Food Group N.V.'s CEO Compensation With the industry

According to our data, Sligro Food Group N.V. has a market capitalization of €1.1b, and paid its CEO total annual compensation worth €705k over the year to December 2020. We note that's a small decrease of 6.3% on last year. In particular, the salary of €546.0k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar companies from the same industry with market caps ranging from €841m to €2.7b, we found that the median CEO total compensation was €2.2m. Accordingly, Sligro Food Group pays its CEO under the industry median. Moreover, Koen Slippens also holds €2.6m worth of Sligro Food Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2020	2019	Proportion (2020)
Salary	€546k	€533k	77%
Other	€159k	€219k	23%
Total Compensation	€705k	€752k	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. According to our research, Sligro Food Group has allocated a higher percentage of pay to salary in comparison to the wider industry. 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.

Sligro Food Group N.V.'s Growth

Over the last three years, Sligro Food Group N.V. has shrunk its earnings per share by 94% per year. Its revenue is down 19% over the previous year.

Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Sligro Food Group N.V. Been A Good Investment?

Given the total shareholder loss of 30% over three years, many shareholders in Sligro Food Group N.V. are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business 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. That's why we did some digging and identified 2 warning signs for Sligro Food Group that you should be aware of before investing.

Switching gears from Sligro Food Group, 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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