Should You Worry About Sing Investments & Finance Limited’s (SGX:S35) CEO Pay Cheque?

Sze Leong Lee became the CEO of Sing Investments & Finance Limited (SGX:S35) in 1997. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we’ll look at a snap shot of the business growth. 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.

See our latest analysis for Sing Investments & Finance

How Does Sze Leong Lee’s Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that Sing Investments & Finance Limited has a market cap of S$170m, and reported total annual CEO compensation of S$1.4m for the year to December 2018. While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at S$797k. We examined a group of similar sized companies, with market capitalizations of below S$283m. The median CEO total compensation in that group is S$469k.

Pay mix tells us a lot about how a company functions versus the wider industry, and it’s no different in the case of Sing Investments & Finance. On a sector level, around 97% of total compensation represents salary and 2.5% is other remuneration. Non-salary compensation represents a greater slice of the remuneration pie for Sing Investments & Finance, in sharp contrast to the overall sector.

It would therefore appear that Sing Investments & Finance Limited pays Sze Leong Lee more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn’t mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous. The graphic below shows how CEO compensation at Sing Investments & Finance has changed from year to year.

SGX:S35 CEO Compensation April 11th 2020
SGX:S35 CEO Compensation April 11th 2020

Is Sing Investments & Finance Limited Growing?

Over the last three years Sing Investments & Finance Limited has seen earnings per share (EPS) move in a positive direction by an average of 7.7% per year (using a line of best fit). Its revenue is down 8.9% over last year.

I generally like to see a little revenue growth, but I’m happy with the EPS growth. In conclusion we can’t form a strong opinion about business performance yet; but it’s one worth watching. We don’t have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Sing Investments & Finance Limited Been A Good Investment?

Given the total loss of 21% over three years, many shareholders in Sing Investments & Finance Limited are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary…

We examined the amount Sing Investments & Finance Limited pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.

Over the last three years, shareholder returns have been downright disappointing, and the underlying business has failed to impress us. Shareholders may wish to consider further research. Although we don’t think the CEO pay is too high, it is probably more on the generous side of things. Taking a breather from CEO compensation, we’ve spotted 3 warning signs for Sing Investments & Finance (of which 1 doesn’t sit too well with us!) you should know about in order to have a holistic understanding of the stock.

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

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

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