Gérard Tremblay became the CEO of Osmozis SA (EPA:ALOSM) in 2016. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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 Gérard Tremblay's Compensation Compare With Similar Sized Companies?
According to our data, Osmozis SA has a market capitalization of €10m, and paid its CEO total annual compensation worth €174k over the year to August 2019. While we always look at total compensation first, we note that the salary component is less, at €130k. We looked at a group of companies with market capitalizations under €181m, and the median CEO total compensation was €289k.
Pay mix tells us a lot about how a company functions versus the wider industry, and it's no different in the case of Osmozis. On an industry level, roughly 74% of total compensation represents salary and 26% is other remuneration. So it seems like there isn't a significant difference between Osmozis and the broader market, in terms of salary allocation in the overall compensation package.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion. The graphic below shows how CEO compensation at Osmozis has changed from year to year.
Is Osmozis SA Growing?
Osmozis SA has seen earnings per share (EPS) move positively by an average of 22% a year, over the last three years (using a line of best fit). In the last year, its revenue changed by just 0.8%.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. It could be important to check this free visual depiction of what analysts expect for the future.
Has Osmozis SA Been A Good Investment?
Given the total loss of 61% over three years, many shareholders in Osmozis SA are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
It appears that Osmozis SA remunerates its CEO below most similar sized companies.
Considering the underlying business is growing earnings, this would suggest the pay is modest. Few would deny that the total shareholder return over the last three years could have been a lot better. So while we would not say that Gérard Tremblay is generously paid, it would be good to see an improvement in business performance before too an increase in pay. In this case we may want to look deeper into the company. There are some real positives and we could see improved returns in the longer term. On another note, Osmozis has 4 warning signs (and 1 which makes us a bit uncomfortable) we think you should know about.
Important note: Osmozis 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 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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