Bart Aangenendt became the CEO of Hydratec Industries NV (AMS:HYDRA) in 2015, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Comparing Hydratec Industries NV's CEO Compensation With the industry
Our data indicates that Hydratec Industries NV has a market capitalization of €68m, and total annual CEO compensation was reported as €341k for the year to December 2019. Notably, that's a decrease of 13% over the year before. Notably, the salary which is €265.0k, represents most of the total compensation being paid.
On comparing similar-sized companies in the industry with market capitalizations below €167m, we found that the median total CEO compensation was €261k. Hence, we can conclude that Bart Aangenendt is remunerated higher than the industry median. Moreover, Bart Aangenendt also holds €3.8m worth of Hydratec Industries stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
Talking in terms of the industry, salary represented approximately 33% of total compensation out of all the companies we analyzed, while other remuneration made up 67% of the pie. Hydratec Industries pays out 78% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
Hydratec Industries NV's Growth
Over the last three years, Hydratec Industries NV has shrunk its earnings per share by 4.4% per year. Its revenue is down 8.1% 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. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Hydratec Industries NV Been A Good Investment?
Hydratec Industries NV has not done too badly by shareholders, with a total return of 3.0%, over three years. But they would probably prefer not to see CEO compensation far in excess of the median.
As previously discussed, Bart is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Unfortunately, EPS has not grown in three years, failing to impress us. And while shareholder returns have been respectable, they have hardly been superb. So you may want to delve deeper, because we don't think the amount Bart makes is justifiable.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 2 warning signs for Hydratec Industries that investors should think about before committing capital to this stock.
Important note: Hydratec Industries 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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Hydratec Industries NV, through its subsidiaries, engages in the manufacture and sale of industrial systems and plastic components for food, health, and mobility markets in the Netherlands, rest of Europe, Asia, North America, South America, Africa, and Oceania.
Excellent balance sheet with solid track record and pays a dividend.