Is Xinyi Glass Holdings Limited’s (HKG:868) CEO Salary Justified?

The CEO of Xinyi Glass Holdings Limited (HKG:868) is Ching Sai Tung. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. 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. The aim of all this is to consider the appropriateness of CEO pay levels.

Check out our latest analysis for Xinyi Glass Holdings

How Does Ching Sai Tung’s Compensation Compare With Similar Sized Companies?

Our data indicates that Xinyi Glass Holdings Limited is worth HK$36b, and total annual CEO compensation is HK$31m. (This number is for the twelve months until December 2017). While this analysis focuses on total compensation, it’s worth noting the salary is lower, valued at HK$8.6m. We examined companies with market caps from HK$16b to HK$50b, and discovered that the median CEO total compensation of that group was HK$3.0m.

As you can see, Ching Sai Tung is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Xinyi Glass Holdings Limited is paying too much. 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 Xinyi Glass Holdings has changed from year to year.

SEHK:868 CEO Compensation, March 29th 2019
SEHK:868 CEO Compensation, March 29th 2019

Is Xinyi Glass Holdings Limited Growing?

On average over the last three years, Xinyi Glass Holdings Limited has grown earnings per share (EPS) by 22% each year (using a line of best fit). Its revenue is up 8.7% over last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It’s nice to see a little revenue growth, as this is consistent with healthy business conditions. Shareholders might be interested in this free visualization of analyst forecasts.

Has Xinyi Glass Holdings Limited Been A Good Investment?

Boasting a total shareholder return of 108% over three years, Xinyi Glass Holdings Limited has done well by shareholders. This strong performance might mean some shareholders don’t mind if the CEO were to be paid more than is normal for a company of its size.

In Summary…

We examined the amount Xinyi Glass Holdings Limited pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.

Importantly, though, the company has impressed with its earnings per share growth, over three years. On top of that, in the same period, returns to shareholders have been great. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Xinyi Glass Holdings (free visualization of insider trades).

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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

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. Thank you for reading.