It's Probably Less Likely That Apellis Pharmaceuticals, Inc.'s (NASDAQ:APLS) CEO Will See A Huge Pay Rise This Year

Key Insights

• Apellis Pharmaceuticals' Annual General Meeting to take place on 5th of June
• Total pay for CEO Cedric Francois includes US$734.5k salary
• Total compensation is similar to the industry average
• Apellis Pharmaceuticals' three-year loss to shareholders was 27% while its EPS grew by 12% over the past three years

Shareholders of Apellis Pharmaceuticals, Inc. (NASDAQ:APLS) will have been dismayed by the negative share price return over the last three years. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. The AGM coming up on the 5th of June could be an opportunity for shareholders to bring these concerns to the board's attention. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

Check out our latest analysis for Apellis Pharmaceuticals

How Does Total Compensation For Cedric Francois Compare With Other Companies In The Industry?

According to our data, Apellis Pharmaceuticals, Inc. has a market capitalization of US$4.9b, and paid its CEO total annual compensation worth US$10m over the year to December 2023. We note that's an increase of 13% above last year. While we always look at total compensation first, our analysis shows that the salary component is less, at US$735k.

In comparison with other companies in the American Biotechs industry with market capitalizations ranging from US$4.0b to US$12b, the reported median CEO total compensation was US$12m. So it looks like Apellis Pharmaceuticals compensates Cedric Francois in line with the median for the industry. What's more, Cedric Francois holds US$75m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	US$735k	US$681k	7%
Other	US$9.6m	US$8.5m	93%
Total Compensation	US$10m	US$9.2m	100%

On an industry level, around 23% of total compensation represents salary and 77% is other remuneration. Apellis Pharmaceuticals pays a modest slice of remuneration through salary, as compared 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.

Apellis Pharmaceuticals, Inc.'s Growth

Over the past three years, Apellis Pharmaceuticals, Inc. has seen its earnings per share (EPS) grow by 12% per year. In the last year, its revenue is up 395%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. 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 Apellis Pharmaceuticals, Inc. Been A Good Investment?

Since shareholders would have lost about 27% over three years, some Apellis Pharmaceuticals, Inc. investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. Shareholders would be keen to know what's holding the stock back when earnings have grown. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 3 warning signs for Apellis Pharmaceuticals that investors should be aware of in a dynamic business environment.

Switching gears from Apellis Pharmaceuticals, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.