We Think AMG Critical Materials N.V.'s (AMS:AMG) CEO Compensation Package Needs To Be Put Under A Microscope

Key Insights

• AMG Critical Materials will host its Annual General Meeting on 8th of May
• Salary of US$1.50m is part of CEO Heinz Schimmelbusch's total remuneration
• Total compensation is 301% above industry average
• AMG Critical Materials' EPS declined by 35% over the past three years while total shareholder loss over the past three years was 48%

Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit.

Shareholders will probably not be too impressed with the underwhelming results at AMG Critical Materials N.V. (AMS:AMG) recently. At the upcoming AGM on 8th of May, shareholders can hear from the board including their plans for turning around performance. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Check out our latest analysis for AMG Critical Materials

Comparing AMG Critical Materials N.V.'s CEO Compensation With The Industry

At the time of writing, our data shows that AMG Critical Materials N.V. has a market capitalization of €505m, and reported total annual CEO compensation of US$3.3m for the year to December 2024. Notably, that's a decrease of 38% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$1.5m.

On comparing similar companies from the the Netherlands Metals and Mining industry with market caps ranging from €177m to €709m, we found that the median CEO total compensation was US$814k. Accordingly, our analysis reveals that AMG Critical Materials N.V. pays Heinz Schimmelbusch north of the industry median. Furthermore, Heinz Schimmelbusch directly owns €20m worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the industry, salary represented approximately 60% of total compensation out of all the companies we analyzed, while other remuneration made up 40% of the pie. In AMG Critical Materials' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

AMG Critical Materials N.V.'s Growth

Over the last three years, AMG Critical Materials N.V. has shrunk its earnings per share by 35% per year. Its revenue is down 11% over the previous year.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation 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 AMG Critical Materials N.V. Been A Good Investment?

The return of -48% over three years would not have pleased AMG Critical Materials N.V. shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

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, 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. We identified 2 warning signs for AMG Critical Materials (1 is significant!) that you should be aware of before investing here.

Important note: AMG Critical Materials 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.