Thomas Ekman has been the CEO of Dustin Group AB (publ) (STO:DUST) since 2018, and this article will examine the executive's compensation 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 Dustin Group.
Comparing Dustin Group AB (publ)'s CEO Compensation With the industry
According to our data, Dustin Group AB (publ) has a market capitalization of kr5.8b, and paid its CEO total annual compensation worth kr9.1m over the year to August 2020. Notably, that's a decrease of 16% over the year before. We note that the salary portion, which stands at kr5.40m constitutes the majority of total compensation received by the CEO.
For comparison, other companies in the same industry with market capitalizations ranging between kr3.3b and kr13b had a median total CEO compensation of kr7.4m. This suggests that Dustin Group remunerates its CEO largely in line with the industry average. Moreover, Thomas Ekman also holds kr2.6m worth of Dustin Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
On an industry level, roughly 67% of total compensation represents salary and 33% is other remuneration. In Dustin Group's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Dustin Group AB (publ)'s Growth
Earnings per share at Dustin Group AB (publ) are much the same as they were three years ago, albeit slightly lower. In the last year, its revenue is up 5.2%.
A lack of EPS improvement is not good to see. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Dustin Group AB (publ) Been A Good Investment?
Since shareholders would have lost about 6.9% over three years, some Dustin 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.
As previously discussed, Thomas is compensated close to the median for companies of its size, and which belong to the same industry. Meanwhile, EPS growth and shareholder returns have been in the red for the last three years. Considering overall performance, shareholders will likely hold off support for a raise until results improve.
CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 2 warning signs for Dustin Group that investors should look into moving forward.
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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