Edward Tsui has been the CEO of Wong’s Kong King International (Holdings) Limited (HKG:532) since 2015. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Next, we’ll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
How Does Edward Tsui’s Compensation Compare With Similar Sized Companies?
Our data indicates that Wong’s Kong King International (Holdings) Limited is worth HK$438m, and total annual CEO compensation was reported as HK$7.1m for the year to December 2018. While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at HK$5.3m. We examined a group of similar sized companies, with market capitalizations of below HK$1.6b. The median CEO total compensation in that group is HK$1.8m.
Next, let’s break down remuneration compositions to understand how the industry and company compare with each other. Speaking on an industry level, we can see that nearly 77% of total compensation represents salary, while the remainder of 23% is other remuneration. Wong’s Kong King International (Holdings) is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation
As you can see, Edward Tsui is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Wong’s Kong King International (Holdings) Limited is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance. The graphic below shows how CEO compensation at Wong’s Kong King International (Holdings) has changed from year to year.
Is Wong’s Kong King International (Holdings) Limited Growing?
On average over the last three years, Wong’s Kong King International (Holdings) Limited has grown earnings per share (EPS) by 23% each year (using a line of best fit). It achieved revenue growth of 1.5% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. We don’t have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Wong’s Kong King International (Holdings) Limited Been A Good Investment?
With a three year total loss of 18%, Wong’s Kong King International (Holdings) Limited would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
We compared the total CEO remuneration paid by Wong’s Kong King International (Holdings) Limited, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
However we must not forget that the EPS growth has been very strong over three years. Having said that, shareholders may be disappointed with the weak returns over the last three years. Considering the per share profit growth, but keeping in mind the weak returns, we’d need more time to form a view on CEO compensation. On another note, Wong’s Kong King International (Holdings) has 5 warning signs (and 1 which doesn’t sit too well with us) we think you should know about.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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