Here's Why Karnov Group AB (publ)'s (STO:KAR) CEO Compensation Is The Least Of Shareholders' Concerns

Key Insights

• Karnov Group's Annual General Meeting to take place on 8th of May
• Salary of kr12.3m is part of CEO Pontus Bodelsson's total remuneration
• The overall pay is comparable to the industry average
• Karnov Group's EPS declined by 30% over the past three years while total shareholder return over the past three years was 33%

Under the guidance of CEO Pontus Bodelsson, Karnov Group AB (publ) (STO:KAR) has performed reasonably well recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 8th of May. Based on our analysis of the data below, we think CEO compensation seems reasonable for now.

Check out our latest analysis for Karnov Group

How Does Total Compensation For Pontus Bodelsson Compare With Other Companies In The Industry?

Our data indicates that Karnov Group AB (publ) has a market capitalization of kr7.2b, and total annual CEO compensation was reported as kr14m for the year to December 2023. That's a notable increase of 47% on last year. Notably, the salary which is kr12.3m, represents most of the total compensation being paid.

In comparison with other companies in the Swedish Interactive Media and Services industry with market capitalizations ranging from kr4.4b to kr18b, the reported median CEO total compensation was kr12m. This suggests that Karnov Group remunerates its CEO largely in line with the industry average. Moreover, Pontus Bodelsson also holds kr3.5m worth of Karnov Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	kr12m	kr7.9m	86%
Other	kr2.0m	kr1.8m	14%
Total Compensation	kr14m	kr9.7m	100%

On an industry level, roughly 61% of total compensation represents salary and 39% is other remuneration. It's interesting to note that Karnov Group pays out a greater portion of remuneration through salary, compared to the 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.

Karnov Group AB (publ)'s Growth

Karnov Group AB (publ) has reduced its earnings per share by 30% a year over the last three years. It achieved revenue growth of 122% over the last year.

Investors would be a bit wary of companies that have lower EPS 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 Karnov Group AB (publ) Been A Good Investment?

With a total shareholder return of 33% over three years, Karnov Group AB (publ) shareholders would, in general, be reasonably content. But they would probably prefer not to see CEO compensation far in excess of the median.

To Conclude...

Some shareholders will be pleased by the relatively good results, however, the results could still be improved. We reckon that there are some shareholders who may be hesitant to increase CEO pay further until EPS growth starts to improve, despite the robust revenue growth.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 2 warning signs for Karnov Group (of which 1 doesn't sit too well with us!) that you should know about in order to have a holistic understanding of the stock.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.