Lars Boilesen became the CEO of Otello Corporation ASA (OB:OTELLO) in 2010, 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 assess whether Otello pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Check out our latest analysis for Otello
How Does Total Compensation For Lars Boilesen Compare With Other Companies In The Industry?
According to our data, Otello Corporation ASA has a market capitalization of kr3.0b, and paid its CEO total annual compensation worth US$1.0m over the year to December 2019. That's a notable decrease of 19% on last year. We note that the salary portion, which stands at US$550.0k constitutes the majority of total compensation received by the CEO.
On comparing similar companies from the same industry with market caps ranging from kr1.8b to kr7.1b, we found that the median CEO total compensation was US$1.1m. From this we gather that Lars Boilesen is paid around the median for CEOs in the industry. Furthermore, Lars Boilesen directly owns kr5.7m worth of shares in the company, implying that they are deeply invested in the company's success.
| Component | 2019 | 2018 | Proportion (2019) |
| Salary | US$550k | US$520k | 54% |
| Other | US$470k | US$740k | 46% |
| Total Compensation | US$1.0m | US$1.3m | 100% |
Speaking on an industry level, nearly 48% of total compensation represents salary, while the remainder of 52% is other remuneration. According to our research, Otello 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.
Otello Corporation ASA's Growth
Over the past three years, Otello Corporation ASA has seen its earnings per share (EPS) grow by 24% per year. Its revenue is up 2.2% over the last year.
Shareholders would be glad to know that the company has improved itself over the last few years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. 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 Otello Corporation ASA Been A Good Investment?
Since shareholders would have lost about 5.2% over three years, some Otello Corporation ASA investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
In Summary...
As previously discussed, Lars is compensated close to the median for companies of its size, and which belong to the same industry. Meanwhile, shareholder returns paint a sorry picture for the company, finishing in the red over the last three years. But EPS growth is moving in a favorable direction, certainly a positive sign. It's tough for us to say CEO compensation is too generous when EPS growth is positive, but negative investor returns will irk shareholders and reduce any chances of a raise.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Otello that investors should think about before committing capital to this stock.
Switching gears from Otello, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.
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This article by Simply Wall St is general in nature. 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.
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About OB:OTEC
Otello
Provides mobile solutions and platforms for digital payments, customer engagement, microfinance, and digital services in Norway.
Adequate balance sheet and slightly overvalued.
