Shareholders May Not Be So Generous With Sonae, SGPS, S.A.'s (ELI:SON) CEO Compensation And Here's Why

Key Insights

• Sonae SGPS' Annual General Meeting to take place on 30th of April
• CEO Maria Claudia de Azevedo's total compensation includes salary of €558.4k
• The total compensation is 151% higher than the average for the industry
• Sonae SGPS' EPS declined by 1.9% over the past three years while total shareholder return over the past three years was 25%

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Under the guidance of CEO Maria Claudia de Azevedo, Sonae, SGPS, S.A. (ELI:SON) has performed reasonably well recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 30th of April. However, some shareholders may still want to keep CEO compensation within reason.

See our latest analysis for Sonae SGPS

How Does Total Compensation For Maria Claudia de Azevedo Compare With Other Companies In The Industry?

According to our data, Sonae, SGPS, S.A. has a market capitalization of €2.0b, and paid its CEO total annual compensation worth €2.0m over the year to December 2024. We note that's an increase of 13% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at €558k.

For comparison, other companies in the Portugal Consumer Retailing industry with market capitalizations ranging between €883m and €2.8b had a median total CEO compensation of €784k. This suggests that Maria Claudia de Azevedo is paid more than the median for the industry. Furthermore, Maria Claudia de Azevedo directly owns €1.1m worth of shares in the company.

On an industry level, roughly 48% of total compensation represents salary and 52% is other remuneration. Sonae SGPS sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Sonae, SGPS, S.A.'s Growth

Over the last three years, Sonae, SGPS, S.A. has shrunk its earnings per share by 1.9% per year. Its revenue is up 19% over the last year.

The reduction in EPS, over three years, is arguably concerning. But in contrast the revenue growth is strong, suggesting future potential for EPS growth. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. 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 Sonae, SGPS, S.A. Been A Good Investment?

With a total shareholder return of 25% over three years, Sonae, SGPS, S.A. shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary...

The overall company performance has been commendable, however there are still areas for improvement. EPS growth is still weak, and until that picks up, shareholders may find it hard to approve a pay rise for the CEO, since they are already paid above the average in their industry.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 2 warning signs for Sonae SGPS (1 is a bit concerning!) that you should be aware of before investing here.

Important note: Sonae SGPS is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.