Here's Why It's Unlikely That Accel Group Holdings Limited's (HKG:1283) CEO Will See A Pay Rise This Year

Key Insights

• Accel Group Holdings will host its Annual General Meeting on 10th of September
• Total pay for CEO Lai Hung Ko includes HK$4.26m salary
• The overall pay is 107% above the industry average
• Over the past three years, Accel Group Holdings' EPS fell by 18% and over the past three years, the total loss to shareholders 52%

Accel Group Holdings Limited (HKG:1283) has not performed well recently and CEO Lai Hung Ko will probably need to up their game. At the upcoming AGM on 10th of September, 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.

See our latest analysis for Accel Group Holdings

Comparing Accel Group Holdings Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Accel Group Holdings Limited has a market capitalization of HK$641m, and reported total annual CEO compensation of HK$4.7m for the year to March 2024. Notably, that's an increase of 27% over the year before. We note that the salary portion, which stands at HK$4.26m constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the Hong Kong Construction industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was HK$2.3m. Accordingly, our analysis reveals that Accel Group Holdings Limited pays Lai Hung Ko north of the industry median.

Component	2024	2023	Proportion (2024)
Salary	HK$4.3m	HK$3.3m	91%
Other	HK$398k	HK$398k	9%
Total Compensation	HK$4.7m	HK$3.7m	100%

Talking in terms of the industry, salary represented approximately 84% of total compensation out of all the companies we analyzed, while other remuneration made up 16% of the pie. Our data reveals that Accel Group Holdings allocates salary more or less in line with the wider market. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Accel Group Holdings Limited's Growth

Over the last three years, Accel Group Holdings Limited has shrunk its earnings per share by 18% per year. In the last year, its revenue is up 2.8%.

Few shareholders would be pleased to read that EPS have declined. The fairly low revenue growth fails to impress given that the EPS is down. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Accel Group Holdings Limited Been A Good Investment?

With a total shareholder return of -52% over three years, Accel Group Holdings Limited 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, the board will get the chance to explain the steps it plans to take to improve business performance.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 2 warning signs for Accel Group Holdings you should be aware of, and 1 of them is significant.

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.