Does Hugo Boss AG's (ETR:BOSS) CEO Pay Reflect Performance?
In 2016 Mark Langer was appointed CEO of Hugo Boss AG (ETR:BOSS). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.
See our latest analysis for Hugo Boss
How Does Mark Langer's Compensation Compare With Similar Sized Companies?
Our data indicates that Hugo Boss AG is worth €2.6b, and total annual CEO compensation was reported as €2.9m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at €850k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of €1.8b to €5.7b. The median total CEO compensation was €2.7m.
That means Mark Langer receives fairly typical remuneration for the CEO of a company that size. 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.
You can see a visual representation of the CEO compensation at Hugo Boss, below.
Is Hugo Boss AG Growing?
Earnings per share at Hugo Boss AG are much the same as they were three years ago, albeit slightly lower, based on the trend. In the last year, its revenue is up 3.2%.
The lack of earnings per share growth in the last three years is unimpressive. And the modest revenue growth over 12 months isn't much comfort against the reduced 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 Hugo Boss AG Been A Good Investment?
With a three year total loss of 37%, Hugo Boss AG would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
Mark Langer 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. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Hugo Boss (free visualization of insider trades).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
