Aker BioMarine ASA's (OB:AKBM) CEO Compensation Looks Acceptable To Us And Here's Why

Key Insights

• Aker BioMarine's Annual General Meeting to take place on 25th of April
• Total pay for CEO Matts Johansen includes US$439.5k salary
• The overall pay is comparable to the industry average
• Aker BioMarine's total shareholder return over the past three years was 72% while its EPS was down 45% over the past three years

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The share price of Aker BioMarine ASA (OB:AKBM) has increased significantly over the past few years. However, the earnings growth has not kept up with the share price momentum, suggesting that some other factors may be driving the price direction. The upcoming AGM on 25th of April may be an opportunity for shareholders to bring up any concerns they may have for the board’s attention. It would also be an opportunity for them to influence management through exercising their voting power on company resolutions, including CEO and executive remuneration, which could impact on firm performance in the future. In our analysis below, we show why shareholders may consider holding off a raise for the CEO's compensation until company performance improves.

See our latest analysis for Aker BioMarine

How Does Total Compensation For Matts Johansen Compare With Other Companies In The Industry?

At the time of writing, our data shows that Aker BioMarine ASA has a market capitalization of kr4.6b, and reported total annual CEO compensation of US$1.0m for the year to December 2024. Notably, that's an increase of 52% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at US$439k.

On comparing similar companies from the Norwegian Food industry with market caps ranging from kr2.1b to kr8.4b, we found that the median CEO total compensation was US$922k. From this we gather that Matts Johansen is paid around the median for CEOs in the industry. Moreover, Matts Johansen also holds kr57m worth of Aker BioMarine stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 66% of total compensation represents salary, while the remainder of 34% is other remuneration. In Aker BioMarine's 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.

A Look at Aker BioMarine ASA's Growth Numbers

Over the last three years, Aker BioMarine ASA has shrunk its earnings per share by 45% per year. Its revenue is up 1.4% over the last year.

Overall this is not a very positive result for shareholders. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. 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 Aker BioMarine ASA Been A Good Investment?

We think that the total shareholder return of 72%, over three years, would leave most Aker BioMarine ASA shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

Although shareholders would be quite happy with the returns they have earned on their initial investment, earnings have failed to grow and this could mean returns may be hard to keep up. The upcoming AGM will provide shareholders the opportunity to revisit the company’s remuneration policies and evaluate if the board’s judgement and decision-making is aligned with that of the company’s shareholders.

CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Aker BioMarine (free visualization of insider trades).

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.