Gustav Witzøe became the CEO of SalMar ASA (OB:SALM) in 2017. 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. This process should give us an idea about how appropriately the CEO is paid.
How Does Gustav Witzøe's Compensation Compare With Similar Sized Companies?
According to our data, SalMar ASA has a market capitalization of kr51b, and paid its CEO total annual compensation worth kr1.4m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at kr1.1m. When we examined a selection of companies with market caps ranging from kr36b to kr109b, we found the median CEO total compensation was kr9.3m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
The graphic below shows how CEO compensation at SalMar has changed from year to year.
Is SalMar ASA Growing?
SalMar ASA has increased its earnings per share (EPS) by an average of 19% a year, over the last three years (using a line of best fit). Its revenue is up 11% over last year.
This demonstrates that the company has been improving recently. A good result. It's a real positive to see this sort of growth in a single year. That suggests a healthy and growing business. Shareholders might be interested in this free visualization of analyst forecasts.
Has SalMar ASA Been A Good Investment?
I think that the total shareholder return of 102%, over three years, would leave most SalMar ASA shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
SalMar ASA is currently paying its CEO below what is normal for companies of its size.
Many would consider this to indicate that the pay is modest since the business is growing. And given most shareholders are probably very happy with recent returns, you might even think that Gustav Witzøe deserves a raise! Most shareholders like to see a modestly paid CEO combined with strong performance by the company. But it is even better if company insiders are also buying shares with their own money. Whatever your view on compensation, you might want to check if insiders are buying or selling SalMar shares (free trial).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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