Superland Group Holdings Limited's (HKG:368) CEO Compensation Is Looking A Bit Stretched At The Moment

Key Insights

• Superland Group Holdings to hold its Annual General Meeting on 21st of June
• Total pay for CEO Chi Chiu Ng includes HK$3.02m salary
• The total compensation is 111% higher than the average for the industry
• Superland Group Holdings' three-year loss to shareholders was 61% while its EPS grew by 2.0% over the past three years

In the past three years, the share price of Superland Group Holdings Limited (HKG:368) has struggled to grow and now shareholders are sitting on a loss. Despite positive EPS growth in the past few years, the share price hasn't tracked the fundamental performance of the company. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 21st of June. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

Check out our latest analysis for Superland Group Holdings

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

At the time of writing, our data shows that Superland Group Holdings Limited has a market capitalization of HK$188m, and reported total annual CEO compensation of HK$4.5m for the year to December 2023. That's a notable decrease of 25% on last year. We note that the salary portion, which stands at HK$3.02m constitutes the majority of total compensation received by 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$2.2m. Accordingly, our analysis reveals that Superland Group Holdings Limited pays Chi Chiu Ng north of the industry median. Furthermore, Chi Chiu Ng directly owns HK$141m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	HK$3.0m	HK$3.0m	66%
Other	HK$1.5m	HK$3.1m	34%
Total Compensation	HK$4.5m	HK$6.1m	100%

On an industry level, around 83% of total compensation represents salary and 17% is other remuneration. It's interesting to note that Superland Group Holdings allocates a smaller portion of compensation to salary in comparison to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Superland Group Holdings Limited's Growth Numbers

Over the past three years, Superland Group Holdings Limited has seen its earnings per share (EPS) grow by 2.0% per year. Its revenue is up 23% over the last year.

We would argue that the modest growth in revenue is a notable positive. And the improvement in EPSis modest but respectable. Although we'll stop short of calling the stock a top performer, we think the company has potential. 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 Superland Group Holdings Limited Been A Good Investment?

With a total shareholder return of -61% over three years, Superland Group Holdings Limited shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Despite the growth in its earnings, the share price decline in the past three years is certainly concerning. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

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. That's why we did our research, and identified 4 warning signs for Superland Group Holdings (of which 2 are a bit unpleasant!) that you should know about in order to have a holistic understanding of the stock.

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.

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