Olav Hellebø became the CEO of ReNeuron Group plc (LON:RENE) in 2014. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Olav Hellebø's Compensation Compare With Similar Sized Companies?
Our data indicates that ReNeuron Group plc is worth UK£41m, and total annual CEO compensation was reported as UK£539k for the year to March 2019. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at UK£358k. We took a group of companies with market capitalizations below UK£153m, and calculated the median CEO total compensation to be UK£248k.
It would therefore appear that ReNeuron Group plc pays Olav Hellebø more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see a visual representation of the CEO compensation at ReNeuron Group, below.
Is ReNeuron Group plc Growing?
ReNeuron Group plc saw earnings per share stay pretty flat over the last three years, albeit with a slight decrease, according to the line of best fit. It achieved revenue growth of 203% over the last year.
The reduction in earnings per share, over three years, is arguably concerning. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. It could be important to check this free visual depiction of what analysts expect for the future.
Has ReNeuron Group plc Been A Good Investment?
Given the total loss of 57% over three years, many shareholders in ReNeuron Group plc are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
We examined the amount ReNeuron Group plc pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
While we have not been overly impressed by the business performance, the shareholder returns, over three years, have been disappointing. Shareholders may wish to consider further research. Although we don't think the CEO pay is too high, it is probably more on the generous side of things. Whatever your view on compensation, you might want to check if insiders are buying or selling ReNeuron Group shares (free trial).
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 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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