We Think Shareholders May Want To Consider A Review Of PostNL N.V.'s (AMS:PNL) CEO Compensation Package

Key Insights

• PostNL's Annual General Meeting to take place on 16th of April
• Salary of €696.6k is part of CEO Herna Verhagen's total remuneration
• The total compensation is 234% higher than the average for the industry
• PostNL's EPS declined by 37% over the past three years while total shareholder loss over the past three years was 61%

Shareholders will probably not be too impressed with the underwhelming results at PostNL N.V. (AMS:PNL) recently. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 16th of April. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Check out our latest analysis for PostNL

How Does Total Compensation For Herna Verhagen Compare With Other Companies In The Industry?

According to our data, PostNL N.V. has a market capitalization of €627m, and paid its CEO total annual compensation worth €1.3m over the year to December 2023. That's a notable increase of 23% on last year. We note that the salary of €696.6k makes up a sizeable portion of the total compensation received by the CEO.

For comparison, other companies in the the Netherlands Logistics industry with market capitalizations ranging between €368m and €1.5b had a median total CEO compensation of €402k. This suggests that Herna Verhagen is paid more than the median for the industry. What's more, Herna Verhagen holds €595k worth of shares in the company in their own name.

Component	2023	2022	Proportion (2023)
Salary	€697k	€680k	52%
Other	€649k	€412k	48%
Total Compensation	€1.3m	€1.1m	100%

Talking in terms of the industry, salary represented approximately 38% of total compensation out of all the companies we analyzed, while other remuneration made up 62% of the pie. According to our research, PostNL has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at PostNL N.V.'s Growth Numbers

PostNL N.V. has reduced its earnings per share by 37% a year over the last three years. The trailing twelve months of revenue was pretty much the same as the prior period.

Overall this is not a very positive result for shareholders. And the flat revenue hardly impresses. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 PostNL N.V. Been A Good Investment?

Few PostNL N.V. shareholders would feel satisfied with the return of -61% over three years. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 2 warning signs for PostNL that investors should be aware of in a dynamic business environment.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.