It Looks Like Shareholders Would Probably Approve Pexip Holding ASA's (OB:PEXIP) CEO Compensation Package

Key Insights

• Pexip Holding to hold its Annual General Meeting on 25th of April
• CEO Trond Johannessen's total compensation includes salary of kr4.66m
• Total compensation is similar to the industry average
• Pexip Holding's total shareholder return over the past three years was 86% while its EPS grew by 71% over the past three years

We've discovered 2 warning signs about Pexip Holding. View them for free.

We have been pretty impressed with the performance at Pexip Holding ASA (OB:PEXIP) recently and CEO Trond Johannessen deserves a mention for their role in it. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 25th of April. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. Here is our take on why we think CEO compensation is not extravagant.

See our latest analysis for Pexip Holding

How Does Total Compensation For Trond Johannessen Compare With Other Companies In The Industry?

Our data indicates that Pexip Holding ASA has a market capitalization of kr4.0b, and total annual CEO compensation was reported as kr10m for the year to December 2024. We note that's an increase of 37% above last year. We think total compensation is more important but our data shows that the CEO salary is lower, at kr4.7m.

On examining similar-sized companies in the Norwegian Software industry with market capitalizations between kr2.1b and kr8.4b, we discovered that the median CEO total compensation of that group was kr11m. This suggests that Pexip Holding remunerates its CEO largely in line with the industry average. Moreover, Trond Johannessen also holds kr9.8m worth of Pexip Holding stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2024	2023	Proportion (2024)
Salary	kr4.7m	kr4.0m	45%
Other	kr5.7m	kr3.5m	55%
Total Compensation	kr10m	kr7.6m	100%

Speaking on an industry level, nearly 73% of total compensation represents salary, while the remainder of 27% is other remuneration. It's interesting to note that Pexip Holding 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.

Pexip Holding ASA's Growth

Over the past three years, Pexip Holding ASA has seen its earnings per share (EPS) grow by 71% per year. It achieved revenue growth of 13% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Pexip Holding ASA Been A Good Investment?

Boasting a total shareholder return of 86% over three years, Pexip Holding ASA has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Some shareholders will probably be more lenient on CEO compensation in the upcoming AGM given the pleasing performance of the company recently. However, despite the strong growth in earnings and share price growth, the focus for shareholders would be how the company plans to steer the company towards sustainable profitability in the near future.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We did our research and identified 2 warning signs (and 1 which makes us a bit uncomfortable) in Pexip Holding we think you should know about.

Important note: Pexip Holding is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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.