Increases to CEO Compensation Might Be Put On Hold For Now at Panoro Energy ASA (OB:PEN)

Key Insights

• Panoro Energy to hold its Annual General Meeting on 21st of May
• Total pay for CEO John Hamilton includes US$603.0k salary
• The overall pay is 31% above the industry average
• Panoro Energy's EPS grew by 10.0% over the past three years while total shareholder loss over the past three years was 9.3%

We've discovered 1 warning sign about Panoro Energy. View them for free.

In the past three years, shareholders of Panoro Energy ASA (OB:PEN) have seen a loss on their investment. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. The AGM coming up on the 21st of May could be an opportunity for shareholders to bring these concerns to the board's attention. They could also influence management through voting on resolutions such as executive remuneration. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.

Check out our latest analysis for Panoro Energy

How Does Total Compensation For John Hamilton Compare With Other Companies In The Industry?

At the time of writing, our data shows that Panoro Energy ASA has a market capitalization of kr2.8b, and reported total annual CEO compensation of US$1.4m for the year to December 2024. We note that's an increase of 9.1% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$603k.

On examining similar-sized companies in the Norwegian Oil and Gas industry with market capitalizations between kr1.0b and kr4.1b, we discovered that the median CEO total compensation of that group was US$1.1m. This suggests that John Hamilton is paid more than the median for the industry. Furthermore, John Hamilton directly owns kr20m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	US$603k	US$534k	43%
Other	US$784k	US$737k	57%
Total Compensation	US$1.4m	US$1.3m	100%

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. Panoro Energy sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Panoro Energy ASA's Growth Numbers

Panoro Energy ASA has seen its earnings per share (EPS) increase by 10.0% a year over the past three years. Its revenue is up 23% over the last year.

This revenue growth could really point to a brighter future. And, while modest, the EPS growth is noticeable. So while performance isn't amazing, we think it really does seem quite respectable. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Panoro Energy ASA Been A Good Investment?

Since shareholders would have lost about 9.3% over three years, some Panoro Energy ASA investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

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 1 warning sign for Panoro Energy that you should be aware of before investing.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.