We Think Some Shareholders May Hesitate To Increase PowerCell Sweden AB (publ)'s (STO:PCELL) CEO Compensation

Key Insights

• PowerCell Sweden will host its Annual General Meeting on 29th of April
• Total pay for CEO Richard Berkling includes kr2.96m salary
• Total compensation is similar to the industry average
• PowerCell Sweden's EPS grew by 16% over the past three years while total shareholder loss over the past three years was 84%

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Shareholders of PowerCell Sweden AB (publ) (STO:PCELL) will have been dismayed by the negative share price return over the last three years. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 29th of April. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.

See our latest analysis for PowerCell Sweden

How Does Total Compensation For Richard Berkling Compare With Other Companies In The Industry?

Our data indicates that PowerCell Sweden AB (publ) has a market capitalization of kr1.6b, and total annual CEO compensation was reported as kr6.4m for the year to December 2024. That's a notable decrease of 11% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at kr3.0m.

On examining similar-sized companies in the Swedish Electrical industry with market capitalizations between kr957m and kr3.8b, we discovered that the median CEO total compensation of that group was kr7.9m. So it looks like PowerCell Sweden compensates Richard Berkling in line with the median for the industry.

Component	2024	2023	Proportion (2024)
Salary	kr3.0m	kr2.8m	46%
Other	kr3.4m	kr4.4m	54%
Total Compensation	kr6.4m	kr7.1m	100%

Talking in terms of the industry, salary represented approximately 75% of total compensation out of all the companies we analyzed, while other remuneration made up 25% of the pie. PowerCell Sweden 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.

A Look at PowerCell Sweden AB (publ)'s Growth Numbers

PowerCell Sweden AB (publ) has seen its earnings per share (EPS) increase by 16% a year over the past three years. It achieved revenue growth of 7.7% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. 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 PowerCell Sweden AB (publ) Been A Good Investment?

With a total shareholder return of -84% over three years, PowerCell Sweden AB (publ) shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. Shareholders would be keen to know what's holding the stock back when earnings have grown. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

So you may want to check if insiders are buying PowerCell Sweden shares with their own money (free access).

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. 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.