It's Unlikely That Shareholders Will Increase Volati AB (publ)'s (STO:VOLO) Compensation By Much This Year

Key Insights

• Volati will host its Annual General Meeting on 25th of April
• Salary of kr3.60m is part of CEO Andreas Stenbäck's total remuneration
• Total compensation is similar to the industry average
• Volati's total shareholder return over the past three years was 4.7% while its EPS grew by 19% over the past three years

Performance at Volati AB (publ) (STO:VOLO) has been reasonably good and CEO Andreas Stenbäck has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 25th of April, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. We present our case of why we think CEO compensation looks fair.

View our latest analysis for Volati

Comparing Volati AB (publ)'s CEO Compensation With The Industry

Our data indicates that Volati AB (publ) has a market capitalization of kr9.0b, and total annual CEO compensation was reported as kr4.0m for the year to December 2023. There was no change in the compensation compared to last year. In particular, the salary of kr3.60m, makes up a huge portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the Swedish Industrials industry with market capitalizations between kr4.4b and kr18b, we discovered that the median CEO total compensation of that group was kr4.0m. This suggests that Volati remunerates its CEO largely in line with the industry average. What's more, Andreas Stenbäck holds kr80m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	kr3.6m	kr3.6m	90%
Other	kr400k	kr400k	10%
Total Compensation	kr4.0m	kr4.0m	100%

Speaking on an industry level, nearly 65% of total compensation represents salary, while the remainder of 35% is other remuneration. Volati pays out 90% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Volati AB (publ)'s Growth

Volati AB (publ) has seen its earnings per share (EPS) increase by 19% a year over the past three years. The trailing twelve months of revenue was pretty much the same as the prior period.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Volati AB (publ) Been A Good Investment?

Volati AB (publ) has not done too badly by shareholders, with a total return of 4.7%, over three years. It would be nice to see that metric improve in the future. As a result, investors in the company might be reluctant about agreeing to increase CEO pay in the future, before seeing an improvement on their returns.

To Conclude...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. In saying that, any proposed increase to CEO compensation will still be assessed on how reasonable it is based on performance and industry benchmarks.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for Volati that you should be aware of before investing.

Important note: Volati 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.