Increases to Multi Retail Group Ltd's (TLV:MRG) CEO Compensation Might Cool off for now

Key Insights

• Multi Retail Group will host its Annual General Meeting on 31st of December
• Total pay for CEO Itzhak Uzana includes ₪2.06m salary
• Total compensation is 1,132% above industry average
• Multi Retail Group's three-year loss to shareholders was 40% while its EPS grew by 21% over the past three years

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The underwhelming share price performance of Multi Retail Group Ltd (TLV:MRG) in the past three years would have disappointed many shareholders. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 31st of December. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

Check out our latest analysis for Multi Retail Group

Comparing Multi Retail Group Ltd's CEO Compensation With The Industry

Our data indicates that Multi Retail Group Ltd has a market capitalization of ₪217m, and total annual CEO compensation was reported as ₪3.5m for the year to December 2024. That's a notable increase of 47% on last year. Notably, the salary which is ₪2.06m, represents a considerable chunk of the total compensation being paid.

In comparison with other companies in the Israel Specialty Retail industry with market capitalizations under ₪637m, the reported median total CEO compensation was ₪287k. Accordingly, our analysis reveals that Multi Retail Group Ltd pays Itzhak Uzana north of the industry median. What's more, Itzhak Uzana holds ₪3.4m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2024	2023	Proportion (2024)
Salary	₪2.1m	₪2.1m	58%
Other	₪1.5m	₪359k	42%
Total Compensation	₪3.5m	₪2.4m	100%

Speaking on an industry level, nearly 51% of total compensation represents salary, while the remainder of 49% is other remuneration. It's interesting to note that Multi Retail Group pays out a greater portion of remuneration through salary, compared to the industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Multi Retail Group Ltd's Growth

Multi Retail Group Ltd has seen its earnings per share (EPS) increase by 21% a year over the past three years. In the last year, its revenue changed by just 0.2%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's nice to see revenue heading northwards, as this is consistent with healthy business conditions. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Multi Retail Group Ltd Been A Good Investment?

With a total shareholder return of -40% over three years, Multi Retail Group Ltd shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 4 warning signs for Multi Retail Group (1 is a bit concerning!) that you should be aware of before investing here.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.