Gauthier Louette has been the CEO of SPIE SA (EPA:SPIE) since 2003. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Gauthier Louette's Compensation Compare With Similar Sized Companies?
Our data indicates that SPIE SA is worth €1.9b, and total annual CEO compensation was reported as €1.5m for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at €775k. We looked at a group of companies with market capitalizations from €912m to €2.9b, and the median CEO total compensation was €1.2m.
Next, let's break down remuneration compositions to understand how the industry and company compare with each other. Talking in terms of the sector, salary represented approximately 55% of total compensation out of all the companies we analysed, while other remuneration made up 45% of the pie. SPIE does not set aside a larger portion of remuneration in the form of salary, maintaining the same rate as the wider market.
So Gauthier Louette receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context. The graphic below shows how CEO compensation at SPIE has changed from year to year.
Is SPIE SA Growing?
On average over the last three years, SPIE SA has shrunk earnings per share by 2.2% each year (measured with a line of best fit). Its revenue is up 3.8% over last year.
The lack of earnings per share growth in the last three years is unimpressive. The modest increase in revenue in the last year isn't enough to make me overlook the disappointing change in earnings per share. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. You might want to check this free visual report on analyst forecasts for future earnings.
Has SPIE SA Been A Good Investment?
With a three year total loss of 46%, SPIE SA would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
Gauthier Louette is paid around what is normal for the leaders of comparable size companies.
Returns have been disappointing and the company is not growing its earnings per share. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves. Shifting gears from CEO pay for a second, we've picked out 3 warning signs for SPIE that investors should be aware of in a dynamic business environment.
Important note: SPIE may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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