Key Insights
- Global Fashion Group’s Annual General Meeting to take place on 12th of June
- Total pay for CEO Christoph Barchewitz includes €751.6k salary
- The total compensation is 168% higher than the average for the industry
- Over the past three years, Global Fashion Group’s EPS fell by 18% and over the past three years, the total loss to shareholders 98%
Shareholders will probably not be too impressed with the underwhelming results at Global Fashion Group S.A. (ETR:GFG) recently. At the upcoming AGM on 12th of June, shareholders can hear from the board including their plans for turning around performance. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. We present the case why we think CEO compensation is out of sync with company performance.
View our latest analysis for Global Fashion Group
How Does Total Compensation For Christoph Barchewitz Compare With Other Companies In The Industry?
At the time of writing, our data shows that Global Fashion Group S.A. has a market capitalization of €49m, and reported total annual CEO compensation of €1.1m for the year to December 2023. That is, the compensation was roughly the same as last year. Notably, the salary which is €751.6k, represents most of the total compensation being paid.
In comparison with other companies in the German Specialty Retail industry with market capitalizations under €184m, the reported median total CEO compensation was €428k. This suggests that Christoph Barchewitz is paid more than the median for the industry.
| Component | 2023 | 2022 | Proportion (2023) |
| Salary | €752k | €664k | 66% |
| Other | €394k | €499k | 34% |
| Total Compensation | €1.1m | €1.2m | 100% |
On an industry level, around 83% of total compensation represents salary and 17% is other remuneration. In Global Fashion Group’s case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Global Fashion Group S.A.’s Growth
Over the last three years, Global Fashion Group S.A. has shrunk its earnings per share by 18% per year. It saw its revenue drop 22% over the last year.
Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company’s future earnings..
Has Global Fashion Group S.A. Been A Good Investment?
With a total shareholder return of -98% over three years, Global Fashion Group S.A. shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.
In Summary…
Not only have shareholders not seen a favorable return on their investment, but the business hasn’t performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.
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 identified 3 warning signs for Global Fashion Group (1 can’t be ignored!) that you should be aware of before investing here.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.
Valuation is complex, but we’re helping make it simple.
Find out whether Global Fashion Group is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.
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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.