FDB Holdings Limited's (HKG:1826) CEO Might Not Expect Shareholders To Be So Generous This Year

Key Insights

• FDB Holdings to hold its Annual General Meeting on 30th of May
• CEO Kin Siu Ng's total compensation includes salary of HK$2.04m
• Total compensation is similar to the industry average
• Over the past three years, FDB Holdings' EPS fell by 0.5% and over the past three years, the total loss to shareholders 41%

The results at FDB Holdings Limited (HKG:1826) have been quite disappointing recently and CEO Kin Siu Ng bears some responsibility for this. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 30th of May. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Check out our latest analysis for FDB Holdings

How Does Total Compensation For Kin Siu Ng Compare With Other Companies In The Industry?

Our data indicates that FDB Holdings Limited has a market capitalization of HK$91m, and total annual CEO compensation was reported as HK$2.1m for the year to December 2023. Notably, that's a decrease of 40% over the year before. Notably, the salary which is HK$2.04m, represents most of the total compensation being paid.

In comparison with other companies in the Hong Kong Construction industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$2.1m. This suggests that FDB Holdings remunerates its CEO largely in line with the industry average. Moreover, Kin Siu Ng also holds HK$51m worth of FDB Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	HK$2.0m	HK$3.4m	99%
Other	HK$18k	HK$18k	1%
Total Compensation	HK$2.1m	HK$3.5m	100%

On an industry level, roughly 83% of total compensation represents salary and 17% is other remuneration. FDB Holdings has gone down a largely traditional route, paying Kin Siu Ng a high salary, giving it preference over non-salary benefits. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

FDB Holdings Limited's Growth

Over the last three years, FDB Holdings Limited has not seen its earnings per share change much, though they have deteriorated slightly. In the last year, its revenue is down 46%.

A lack of EPS improvement is not good to see. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has FDB Holdings Limited Been A Good Investment?

With a total shareholder return of -41% over three years, FDB 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...

FDB Holdings pays its CEO a majority of compensation through a salary. 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, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 4 warning signs for FDB Holdings (3 don't sit too well with us!) that you should be aware of before investing here.

Important note: FDB Holdings is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.