In This Article:
Jarle Roth became the CEO of Arendals Fossekompani ASA (OB:AFK) in 2016. 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. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
View our latest analysis for Arendals Fossekompani
How Does Jarle Roth's Compensation Compare With Similar Sized Companies?
Our data indicates that Arendals Fossekompani ASA is worth kr5.2b, and total annual CEO compensation is kr6.7m. (This figure is for the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at kr3.9m. We looked at a group of companies with market capitalizations from kr1.8b to kr7.2b, and the median CEO total compensation was kr4.3m.
Thus we can conclude that Jarle Roth receives more in total compensation than the median of a group of companies in the same market, and of similar size to Arendals Fossekompani ASA. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Arendals Fossekompani has changed from year to year.
Is Arendals Fossekompani ASA Growing?
Over the last three years Arendals Fossekompani ASA has shrunk its earnings per share by an average of 58% per year (measured with a line of best fit). In the last year, its revenue is up 8.3%.
Few shareholders would be pleased to read that earnings per share are lower over three years. The fairly low revenue growth fails to impress given that the earnings per share is down. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Arendals Fossekompani ASA Been A Good Investment?
Boasting a total shareholder return of 44% over three years, Arendals Fossekompani ASA has done well by shareholders. 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.
In Summary...
We compared total CEO remuneration at Arendals Fossekompani ASA with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.