We Think Some Shareholders May Hesitate To Increase Chinney Kin Wing Holdings Limited's (HKG:1556) CEO Compensation

Key Insights

• Chinney Kin Wing Holdings' Annual General Meeting to take place on 7th of June
• Salary of HK$6.75m is part of CEO Johnny Yu's total remuneration
• Total compensation is 965% above industry average
• Over the past three years, Chinney Kin Wing Holdings' EPS grew by 16% and over the past three years, the total shareholder return was 75%

CEO Johnny Yu has done a decent job of delivering relatively good performance at Chinney Kin Wing Holdings Limited (HKG:1556) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 7th of June. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for Chinney Kin Wing Holdings

How Does Total Compensation For Johnny Yu Compare With Other Companies In The Industry?

According to our data, Chinney Kin Wing Holdings Limited has a market capitalization of HK$428m, and paid its CEO total annual compensation worth HK$23m over the year to December 2023. Notably, that's an increase of 76% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at HK$6.8m.

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$2.2m. Hence, we can conclude that Johnny Yu is remunerated higher than the industry median. Moreover, Johnny Yu also holds HK$1.4m worth of Chinney Kin Wing Holdings stock directly under their own name.

Component	2023	2022	Proportion (2023)
Salary	HK$6.8m	HK$5.4m	29%
Other	HK$16m	HK$7.7m	71%
Total Compensation	HK$23m	HK$13m	100%

Talking in terms of the industry, salary represented approximately 83% of total compensation out of all the companies we analyzed, while other remuneration made up 17% of the pie. Chinney Kin Wing Holdings pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Chinney Kin Wing Holdings Limited's Growth

Chinney Kin Wing Holdings Limited's earnings per share (EPS) grew 16% per year over the last three years. Its revenue is up 18% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Chinney Kin Wing Holdings Limited Been A Good Investment?

We think that the total shareholder return of 75%, over three years, would leave most Chinney Kin Wing Holdings Limited shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for Chinney Kin Wing Holdings that you should be aware of before investing.

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.

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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.