The CEO of Électricite de Strasbourg Société Anonyme (EPA:ELEC) is Marc Kugler. 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 process should give us an idea about how appropriately the CEO is paid.
How Does Marc Kugler's Compensation Compare With Similar Sized Companies?
Our data indicates that Électricite de Strasbourg Société Anonyme is worth €842m, and total annual CEO compensation was reported as €276k for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at €194k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of €358m to €1.4b. The median total CEO compensation was €659k.
A first glance this seems like a real positive for shareholders, since Marc Kugler is paid less than the average total compensation paid by similar sized companies. Though positive, it's important we delve into the performance of the actual business.
The graphic below shows how CEO compensation at Électricite de Strasbourg Société Anonyme has changed from year to year.
Is Électricite de Strasbourg Société Anonyme Growing?
Over the last three years Électricite de Strasbourg Société Anonyme has shrunk its earnings per share by an average of 8.4% per year (measured with a line of best fit). In the last year, its revenue is up 6.6%.
Sadly for shareholders, earnings per share are actually down, over three years. And the modest revenue growth over 12 months isn't much comfort against the reduced earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Électricite de Strasbourg Société Anonyme Been A Good Investment?
With a total shareholder return of 26% over three years, Électricite de Strasbourg Société Anonyme shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
Électricite de Strasbourg Société Anonyme is currently paying its CEO below what is normal for companies of its size.
The compensation paid to Marc Kugler is lower than is usual at similar sized companies. But the business isn't growing earnings per share, and the returns to shareholders haven't been wonderful. So while shareholders shouldn't be overly concerned about CEO compensation, we suspect most would prefer see improved performance, before increasing pay. So you may want to check if insiders are buying Électricite de Strasbourg Société Anonyme shares with their own money (free access).
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.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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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