This Is Why Shareholders May Want To Hold Back On A Pay Rise For Volati AB (publ)'s (STO:VOLO) CEO

Key Insights

• Volati's Annual General Meeting to take place on 28th of April
• CEO Andreas Stenbäck's total compensation includes salary of kr4.20m
• The total compensation is 53% less than the average for the industry
• Volati's three-year loss to shareholders was 24% while its EPS was down 16% over the past three years

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Performance at Volati AB (publ) (STO:VOLO) has not been particularly rosy recently and shareholders will likely be holding CEO Andreas Stenbäck and the board accountable for this. The next AGM coming up on 28th of April will be a chance for shareholders to have their concerns addressed by the board, challenge management on company strategy and vote on resolutions such as executive remuneration, which may help change the company's future prospects. We think most shareholders will probably pass the CEO compensation, based on what we gathered.

View our latest analysis for Volati

How Does Total Compensation For Andreas Stenbäck Compare With Other Companies In The Industry?

According to our data, Volati AB (publ) has a market capitalization of kr8.6b, and paid its CEO total annual compensation worth kr4.6m over the year to December 2024. We note that's an increase of 15% above last year. Notably, the salary which is kr4.20m, represents most of the total compensation being paid.

On examining similar-sized companies in the Swedish Industrials industry with market capitalizations between kr3.9b and kr15b, we discovered that the median CEO total compensation of that group was kr9.7m. Accordingly, Volati pays its CEO under the industry median. Moreover, Andreas Stenbäck also holds kr77m worth of Volati stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 60% of total compensation represents salary, while the remainder of 40% is other remuneration. Volati is paying a higher share of its remuneration through a salary in comparison to the overall 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.

A Look at Volati AB (publ)'s Growth Numbers

Volati AB (publ) has reduced its earnings per share by 16% a year over the last three years. Revenue was pretty flat on last year.

The decline in EPS is a bit concerning. And the flat revenue hardly impresses. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Volati AB (publ) Been A Good Investment?

Given the total shareholder loss of 24% over three years, many shareholders in Volati AB (publ) are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. 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.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for Volati that investors should be aware of in a dynamic business environment.

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.