How Should Investors React To Aspo Oyj's (HEL:ASPO) CEO Pay?
In 2009 Aki Ojanen was appointed CEO of Aspo Oyj (HEL:ASPO). 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. 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.
View our latest analysis for Aspo Oyj
How Does Aki Ojanen's Compensation Compare With Similar Sized Companies?
According to our data, Aspo Oyj has a market capitalization of €241m, and paid its CEO total annual compensation worth €1.0m over the year to December 2018. While we always look at total compensation first, we note that the salary component is less, at €381k. We note that more than half of the total compensation is not the salary; and performance requirements may apply to this non-salary portion. When we examined a selection of companies with market caps ranging from €91m to €363m, we found the median CEO total compensation was €508k.
Thus we can conclude that Aki Ojanen receives more in total compensation than the median of a group of companies in the same market, and of similar size to Aspo Oyj. However, this doesn't necessarily mean the pay 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, below, how CEO compensation at Aspo Oyj has changed over time.
Is Aspo Oyj Growing?
Aspo Oyj has reduced its earnings per share by an average of 5.7% a year, over the last three years (measured with a line of best fit). It achieved revenue growth of 16% over the last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. You might want to check this free visual report on analyst forecasts for future earnings.
Has Aspo Oyj Been A Good Investment?
With a total shareholder return of 5.1% over three years, Aspo Oyj has done okay by shareholders. But they would probably prefer not to see CEO compensation far in excess of the median.
In Summary...
We compared total CEO remuneration at Aspo Oyj with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
Neither earnings per share nor revenue have been growing sufficiently to impress us, over the last three years. While shareholder returns are acceptable, they don't delight. So we doubt many shareholders would consider the CEO pay to be particularly modest! Shareholders may want to check for free if Aspo Oyj insiders are buying or selling shares.
If you want to buy a stock that is better than Aspo Oyj, this free list of high return, low debt companies is a great place to look.
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.
