We Discuss Why GC Rieber Shipping ASA's (OB:RISH) CEO Compensation May Be Closely Reviewed

GC Rieber Shipping ASA (OB:RISH) has not performed well recently and CEO Einar Ytredal will probably need to up their game. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 21 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 GC Rieber Shipping

How Does Total Compensation For Einar Ytredal Compare With Other Companies In The Industry?

According to our data, GC Rieber Shipping ASA has a market capitalization of kr650m, and paid its CEO total annual compensation worth kr2.8m over the year to December 2020. That is, the compensation was roughly the same as last year. In particular, the salary of kr2.48m, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the industry with market capitalizations under kr1.7b, the reported median total CEO compensation was kr932k. Hence, we can conclude that Einar Ytredal is remunerated higher than the industry median.

Talking in terms of the industry, salary represented approximately 61% of total compensation out of all the companies we analyzed, while other remuneration made up 39% of the pie. It's interesting to note that GC Rieber Shipping pays out a greater portion of remuneration through salary, compared to the 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.

GC Rieber Shipping ASA's Growth

Over the last three years, GC Rieber Shipping ASA has shrunk its earnings per share by 26% per year. Revenue was pretty flat on last year.

Few shareholders would be pleased to read that EPS have declined. And the flat revenue is seriously uninspiring. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has GC Rieber Shipping ASA Been A Good Investment?

Since shareholders would have lost about 9.8% over three years, some GC Rieber Shipping ASA investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

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, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

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 GC Rieber Shipping 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. 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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