Yahoo Finance Here's Why Shareholders Should Examine Aurubis AG's (ETR:NDA) CEO Compensation Package More Closely
Key Insights
Aurubis' Annual General Meeting to take place on 15th of February
Salary of €650.0k is part of CEO Roland Harings's total remuneration
Total compensation is similar to the industry average
Aurubis' EPS declined by 27% over the past three years while total shareholder loss over the past three years was 4.0%
Aurubis AG (ETR:NDA) has not performed well recently and CEO Roland Harings will probably need to up their game. At the upcoming AGM on 15th of February, shareholders can hear from the board including their plans for turning around performance. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. From our analysis, we think CEO compensation may need a review in light of the recent performance.
See our latest analysis for Aurubis
How Does Total Compensation For Roland Harings Compare With Other Companies In The Industry?
Our data indicates that Aurubis AG has a market capitalization of €2.7b, and total annual CEO compensation was reported as €1.1m for the year to September 2023. Notably, that's a decrease of 49% over the year before. In particular, the salary of €650.0k, makes up a fairly large portion of the total compensation being paid to the CEO.
On comparing similar companies from the Germany Metals and Mining industry with market caps ranging from €1.9b to €5.9b, we found that the median CEO total compensation was €932k. So it looks like Aurubis compensates Roland Harings in line with the median for the industry.
Component | 2023 | 2022 | Proportion (2023) |
Salary | €650k | €650k | 59% |
Other | €453k | €1.5m | 41% |
Total Compensation | €1.1m | €2.1m | 100% |
On an industry level, around 60% of total compensation represents salary and 40% is other remuneration. Our data reveals that Aurubis allocates salary more or less in line with the wider market. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.
Aurubis AG's Growth
Aurubis AG has reduced its earnings per share by 27% a year over the last three years. In the last year, its revenue is down 7.3%.
The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Aurubis AG Been A Good Investment?
With a three year total loss of 4.0% for the shareholders, Aurubis AG would certainly have some dissatisfied shareholders. 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. We've identified 3 warning signs for Aurubis that investors should be aware of in a dynamic business environment.
Important note: Aurubis 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
