It Looks Like MPC Container Ships ASA's (OB:MPCC) CEO May Expect Their Salary To Be Put Under The Microscope

MPC Container Ships ASA (OB:MPCC) has not performed well recently and CEO Constantin Baack will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 28 April 2021. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. From our analysis, we think CEO compensation may need a review in light of the recent performance.

View our latest analysis for MPC Container Ships

Comparing MPC Container Ships ASA's CEO Compensation With the industry

At the time of writing, our data shows that MPC Container Ships ASA has a market capitalization of kr5.2b, and reported total annual CEO compensation of US$415k for the year to December 2020. Notably, that's a decrease of 15% over the year before. In particular, the salary of US$286.0k, makes up a huge portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the industry with market capitalizations between kr3.3b and kr13b, we discovered that the median CEO total compensation of that group was US$415k. From this we gather that Constantin Baack is paid around the median for CEOs in the industry.

Component	2020	2019	Proportion (2020)
Salary	US$286k	US$340k	69%
Other	US$129k	US$150k	31%
Total Compensation	US$415k	US$490k	100%

On an industry level, around 61% of total compensation represents salary and 39% is other remuneration. MPC Container Ships is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

MPC Container Ships ASA's Growth

Over the last three years, MPC Container Ships ASA has shrunk its earnings per share by 65% per year. In the last year, its revenue is down 6.9%.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. 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 MPC Container Ships ASA Been A Good Investment?

With a total shareholder return of -51% over three years, MPC Container Ships ASA shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 2 warning signs (and 1 which is significant) in MPC Container Ships we think you should know about.

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. 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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