Here's Why It's Unlikely That Cromwell European Real Estate Investment Trust's (SGX:CWBU) CEO Will See A Pay Rise This Year

Key Insights

• Cromwell European Real Estate Investment Trust to hold its Annual General Meeting on 30th of April
• CEO Simon Garing's total compensation includes salary of €433.5k
• Total compensation is similar to the industry average
• Over the past three years, Cromwell European Real Estate Investment Trust's EPS fell by 78% and over the past three years, the total loss to shareholders 17%

Cromwell European Real Estate Investment Trust (SGX:CWBU) has not performed well recently and CEO Simon Garing 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 30th of April. 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. The data we present below explains why we think CEO compensation is not consistent with recent performance.

See our latest analysis for Cromwell European Real Estate Investment Trust

How Does Total Compensation For Simon Garing Compare With Other Companies In The Industry?

Our data indicates that Cromwell European Real Estate Investment Trust has a market capitalization of €838m, and total annual CEO compensation was reported as €859k for the year to December 2023. This means that the compensation hasn't changed much from last year. Notably, the salary which is €433.5k, represents a considerable chunk of the total compensation being paid.

In comparison with other companies in the Singapore REITs industry with market capitalizations ranging from €375m to €1.5b, the reported median CEO total compensation was €954k. So it looks like Cromwell European Real Estate Investment Trust compensates Simon Garing in line with the median for the industry. What's more, Simon Garing holds €360k worth of shares in the company in their own name.

Component	2023	2022	Proportion (2023)
Salary	€433k	€394k	50%
Other	€425k	€491k	50%
Total Compensation	€859k	€885k	100%

On an industry level, around 43% of total compensation represents salary and 57% is other remuneration. Cromwell European Real Estate Investment Trust pays out 50% of remuneration in the form of a salary, significantly higher than the industry average. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Cromwell European Real Estate Investment Trust's Growth

Cromwell European Real Estate Investment Trust has reduced its earnings per share by 78% a year over the last three years. In the last year, its revenue is down 2.5%.

The decline in EPS is a bit concerning. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Cromwell European Real Estate Investment Trust Been A Good Investment?

Since shareholders would have lost about 17% over three years, some Cromwell European Real Estate Investment Trust investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO 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.

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. We did our research and identified 2 warning signs (and 1 which doesn't sit too well with us) in Cromwell European Real Estate Investment Trust we think you should know about.

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.