Key Insights

RHI Magnesita to hold its Annual General Meeting on 2nd of May Total pay for CEO Stefan Borgas includes €1.14m salary The overall pay is 93% above the industry average Over the past three years, RHI Magnesita's EPS grew by 90%  and over the past three years, the total loss to shareholders 12%

In the past three years, the share price of RHI Magnesita N.V. (LON:RHIM) has struggled to generate growth for its shareholders. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. The AGM coming up on the 2nd of May could be an opportunity for shareholders to bring these concerns to the board's attention. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

View our latest analysis for RHI Magnesita

Comparing RHI Magnesita N.V.'s CEO Compensation With The Industry

At the time of writing, our data shows that RHI Magnesita N.V. has a market capitalization of UK£1.7b, and reported total annual CEO compensation of €4.0m for the year to December 2023. That's a notable increase of 21% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at €1.1m.

On comparing similar companies from the British Basic Materials industry with market caps ranging from UK£799m to UK£2.6b, we found that the median CEO total compensation was €2.1m. Accordingly, our analysis reveals that RHI Magnesita N.V. pays Stefan Borgas north of the industry median. Moreover, Stefan Borgas also holds UK£2.6m worth of RHI Magnesita stock directly under their own name.

Component 2023 2022 Proportion (2023) Salary €1.1m €1.1m 29% Other €2.8m €2.2m 71% Total Compensation €4.0m €3.3m 100%

On an industry level, roughly 36% of total compensation represents salary and 64% is other remuneration. It's interesting to note that RHI Magnesita allocates a smaller portion of compensation to salary in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance. ceo-compensation

A Look at RHI Magnesita N.V.'s Growth Numbers

RHI Magnesita N.V.'s earnings per share (EPS) grew 90% per year over the last three years. In the last year, its revenue is up 7.7%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see modest revenue growth, suggesting the underlying business is healthy. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..



Has RHI Magnesita N.V. Been A Good Investment?

Given the total shareholder loss of 12% over three years, many shareholders in RHI Magnesita N.V. are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. The stock's movement is disjointed with the company's earnings growth, which ideally should move in the same direction. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still in line with their expectations.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 2 warning signs for RHI Magnesita that you should be aware of before investing.

Switching gears from RHI Magnesita, if you're hunting for a pristine balance sheet and premium returns, this freelist of high return, low debt companies is a great place to look.

Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.