Niels Buus is the CEO of GomSpace Group AB (publ) (STO:GOMX), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for GomSpace Group.
View our latest analysis for GomSpace Group
How Does Total Compensation For Niels Buus Compare With Other Companies In The Industry?
At the time of writing, our data shows that GomSpace Group AB (publ) has a market capitalization of kr543m, and reported total annual CEO compensation of kr2.2m for the year to December 2019. That's a notable decrease of 23% on last year. We note that the salary portion, which stands at kr1.88m constitutes the majority of total compensation received by the CEO.
On comparing similar-sized companies in the industry with market capitalizations below kr1.7b, we found that the median total CEO compensation was kr2.2m. So it looks like GomSpace Group compensates Niels Buus in line with the median for the industry. Furthermore, Niels Buus directly owns kr13m worth of shares in the company, implying that they are deeply invested in the company's success.
| Component | 2019 | 2018 | Proportion (2019) |
| Salary | kr1.9m | kr2.0m | 86% |
| Other | kr303k | kr872k | 14% |
| Total Compensation | kr2.2m | kr2.8m | 100% |
Talking in terms of the industry, salary represented approximately 42% of total compensation out of all the companies we analyzed, while other remuneration made up 58% of the pie. GomSpace Group pays out 86% of remuneration in the form of a salary, significantly higher than the industry average. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
GomSpace Group AB (publ)'s Growth
Over the last three years, GomSpace Group AB (publ) has shrunk its earnings per share by 3.2% per year. Its revenue is up 16% over the last year.
The decrease in EPS could be a concern for some investors. On the other hand, the strong revenue growth suggests the business is growing. It's hard to reach a conclusion about business performance right now. This may be one to watch. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has GomSpace Group AB (publ) Been A Good Investment?
Since shareholders would have lost about 86% over three years, some GomSpace Group AB (publ) investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
As previously discussed, Niels is compensated close to the median for companies of its size, and which belong to the same industry. Still, the company is logging healthy revenue growth over the last year. In contrast, over the same time span, shareholder returns are negative. EPS growth is also negative, adding insult to injury. It's tough for us to say Niels is overpaid but a mixed bag in terms of performance will surely irk shareholders and reduce chances of a raise.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for GomSpace Group that you should be aware of before investing.
Important note: GomSpace Group 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. 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 OM:GOMX
GomSpace Group
Through its subsidiaries, designs, develops, integrates, and manufactures nanosatellites for the academic, government, and commercial markets.
Excellent balance sheet very low.
