We Think Shareholders Will Probably Be Generous With Yuanda China Holdings Limited's (HKG:2789) CEO Compensation

Key Insights

• Yuanda China Holdings to hold its Annual General Meeting on 3rd of June
• CEO Zhongqiu Zhao's total compensation includes salary of CN¥539.0k
• The total compensation is similar to the average for the industry
• Yuanda China Holdings' total shareholder return over the past three years was 233% while its EPS grew by 89% over the past three years

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It would be hard to discount the role that CEO Zhongqiu Zhao has played in delivering the impressive results at Yuanda China Holdings Limited (HKG:2789) recently. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 3rd of June. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. Here is our take on why we think CEO compensation is not extravagant.

See our latest analysis for Yuanda China Holdings

Comparing Yuanda China Holdings Limited's CEO Compensation With The Industry

Our data indicates that Yuanda China Holdings Limited has a market capitalization of HK$534m, and total annual CEO compensation was reported as CN¥580k for the year to December 2024. That's a notable decrease of 60% on last year. We note that the salary portion, which stands at CN¥539.0k constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the Hong Kong Building industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of CN¥581k. So it looks like Yuanda China Holdings compensates Zhongqiu Zhao in line with the median for the industry.

Talking in terms of the industry, salary represented approximately 75% of total compensation out of all the companies we analyzed, while other remuneration made up 25% of the pie. It's interesting to note that Yuanda China Holdings pays out a greater portion of remuneration through salary, compared to the 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.

A Look at Yuanda China Holdings Limited's Growth Numbers

Yuanda China Holdings Limited's earnings per share (EPS) grew 89% per year over the last three years. In the last year, its revenue is down 14%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. 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 Yuanda China Holdings Limited Been A Good Investment?

Most shareholders would probably be pleased with Yuanda China Holdings Limited for providing a total return of 233% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

CEO compensation can have a massive impact on performance, but it's just one element. We've identified 2 warning signs for Yuanda China Holdings that investors should be aware of in a dynamic business environment.

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.