Why We Think The CEO Of Celsius Holdings, Inc. (NASDAQ:CELH) May Soon See A Pay Rise

By
Simply Wall St
Published
August 12, 2021
NasdaqCM:CELH
Source: Shutterstock

Shareholders will be pleased by the impressive results for Celsius Holdings, Inc. (NASDAQ:CELH) recently and CEO John Fieldly has played a key role. At the upcoming AGM on 19 August 2021, they would be interested to hear about the company strategy going forward and get a chance to cast their votes on resolutions such as executive remuneration and other company matters. Here we will show why we think CEO compensation is appropriate and discuss the case for a pay rise.

Check out our latest analysis for Celsius Holdings

Comparing Celsius Holdings, Inc.'s CEO Compensation With the industry

According to our data, Celsius Holdings, Inc. has a market capitalization of US$5.5b, and paid its CEO total annual compensation worth US$756k over the year to December 2020. That's a notable increase of 14% on last year. Notably, the salary which is US$464.5k, represents most of the total compensation being paid.

For comparison, other companies in the same industry with market capitalizations ranging between US$4.0b and US$12b had a median total CEO compensation of US$3.0m. Accordingly, Celsius Holdings pays its CEO under the industry median. What's more, John Fieldly holds US$21m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component20202019Proportion (2020)
Salary US$465k US$422k 61%
Other US$291k US$240k 39%
Total CompensationUS$756k US$663k100%

On an industry level, roughly 21% of total compensation represents salary and 79% is other remuneration. Celsius Holdings pays out 61% 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.

ceo-compensation
NasdaqCM:CELH CEO Compensation August 13th 2021

A Look at Celsius Holdings, Inc.'s Growth Numbers

Celsius Holdings, Inc. has seen its earnings per share (EPS) increase by 94% a year over the past three years. It achieved revenue growth of 72% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. 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 Celsius Holdings, Inc. Been A Good Investment?

We think that the total shareholder return of 1,519%, over three years, would leave most Celsius Holdings, Inc. shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

Given the improved performance, shareholders may be more forgiving of CEO compensation in the upcoming AGM. In saying that, some shareholders may feel that the more important issues to be addressed may be how the management plans to steer the company towards sustainable profitability in the future.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 4 warning signs for Celsius Holdings (1 is significant!) that you should be aware of before investing here.

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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