We Discuss Why NCAB Group AB (publ)'s (STO:NCAB) CEO Compensation May Be Closely Reviewed

Key Insights

• NCAB Group to hold its Annual General Meeting on 8th of May
• CEO Peter Kruk's total compensation includes salary of kr3.97m
• The overall pay is comparable to the industry average
• Over the past three years, NCAB Group's EPS fell by 11% and over the past three years, the total loss to shareholders 24%

Our free stock report includes 3 warning signs investors should be aware of before investing in NCAB Group. Read for free now.

NCAB Group AB (publ) (STO:NCAB) has not performed well recently and CEO Peter Kruk will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 8th of May. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. We present the case why we think CEO compensation is out of sync with company performance.

See our latest analysis for NCAB Group

How Does Total Compensation For Peter Kruk Compare With Other Companies In The Industry?

According to our data, NCAB Group AB (publ) has a market capitalization of kr8.0b, and paid its CEO total annual compensation worth kr8.5m over the year to December 2024. Notably, that's an increase of 37% over the year before. We think total compensation is more important but our data shows that the CEO salary is lower, at kr4.0m.

On examining similar-sized companies in the Swedish Electronic industry with market capitalizations between kr3.9b and kr16b, we discovered that the median CEO total compensation of that group was kr9.3m. So it looks like NCAB Group compensates Peter Kruk in line with the median for the industry. Moreover, Peter Kruk also holds kr4.7m worth of NCAB Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2024	2023	Proportion (2024)
Salary	kr4.0m	kr3.5m	47%
Other	kr4.6m	kr2.7m	53%
Total Compensation	kr8.5m	kr6.2m	100%

On an industry level, around 57% of total compensation represents salary and 43% is other remuneration. In NCAB Group's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at NCAB Group AB (publ)'s Growth Numbers

NCAB Group AB (publ) has reduced its earnings per share by 11% a year over the last three years. It saw its revenue drop 6.9% over the last year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has NCAB Group AB (publ) Been A Good Investment?

Since shareholders would have lost about 24% over three years, some NCAB 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.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 3 warning signs for NCAB Group that you should be aware of before investing.

Important note: NCAB Group 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.