Shareholders May Not Be So Generous With Yee Hop Holdings Limited's (HKG:1662) CEO Compensation And Here's Why

Key Insights

• Yee Hop Holdings' Annual General Meeting to take place on 13th of September
• Total pay for CEO Andrew Yan includes HK$1.80m salary
• The total compensation is similar to the average for the industry
• Yee Hop Holdings' EPS declined by 35% over the past three years while total shareholder loss over the past three years was 18%

Shareholders of Yee Hop Holdings Limited (HKG:1662) will have been dismayed by the negative share price return over the last three years. Per share earnings growth is also poor, despite revenues growing. The AGM coming up on 13th of September will be an opportunity for shareholders to have their concerns addressed by the board and for them to exercise their influence on management through voting on resolutions such as executive remuneration. Here's our take on why we think shareholders might be hesitant about approving a raise at the moment.

Check out our latest analysis for Yee Hop Holdings

How Does Total Compensation For Andrew Yan Compare With Other Companies In The Industry?

At the time of writing, our data shows that Yee Hop Holdings Limited has a market capitalization of HK$820m, and reported total annual CEO compensation of HK$2.5m for the year to March 2024. That's a notable increase of 9.6% on last year. In particular, the salary of HK$1.80m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the Hong Kong Construction industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$2.3m. So it looks like Yee Hop Holdings compensates Andrew Yan in line with the median for the industry.

Component	2024	2023	Proportion (2024)
Salary	HK$1.8m	HK$1.6m	73%
Other	HK$663k	HK$648k	27%
Total Compensation	HK$2.5m	HK$2.2m	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. In Yee Hop Holdings' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. 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.

Yee Hop Holdings Limited's Growth

Yee Hop Holdings Limited has reduced its earnings per share by 35% a year over the last three years. Its revenue is up 18% over the last year.

The decrease in EPS could be a concern for some investors. But in contrast the revenue growth is strong, suggesting future potential for EPS growth. It's hard to reach a conclusion about business performance right now. This may be one to watch. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Yee Hop Holdings Limited Been A Good Investment?

With a three year total loss of 18% for the shareholders, Yee Hop Holdings Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

The returns to shareholders is disappointing along with lack of earnings growth, which goes some way in explaining the poor returns. Shareholders will get the chance at the upcoming AGM to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 1 warning sign for Yee Hop Holdings that investors should look into moving forward.

Switching gears from Yee Hop Holdings, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.