Shareholders May Be More Conservative With Chinney Alliance Group Limited's (HKG:385) CEO Compensation For Now

Key Insights

• Chinney Alliance Group will host its Annual General Meeting on 6th of June
• Salary of HK$8.17m is part of CEO Zuric Chan's total remuneration
• Total compensation is 1,088% above industry average
• Over the past three years, Chinney Alliance Group's EPS fell by 13% and over the past three years, the total loss to shareholders 46%

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The underwhelming share price performance of Chinney Alliance Group Limited (HKG:385) in the past three years would have disappointed many shareholders. In addition, the company's per-share earnings growth is not looking good, despite growing revenues. The AGM coming up on 6th of June 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.

See our latest analysis for Chinney Alliance Group

Comparing Chinney Alliance Group Limited's CEO Compensation With The Industry

According to our data, Chinney Alliance Group Limited has a market capitalization of HK$235m, and paid its CEO total annual compensation worth HK$26m over the year to December 2024. That's just a smallish increase of 5.6% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at HK$8.2m.

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. Hence, we can conclude that Zuric Chan is remunerated higher than the industry median.

Speaking on an industry level, nearly 85% of total compensation represents salary, while the remainder of 15% is other remuneration. Chinney Alliance Group sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

Chinney Alliance Group Limited's Growth

Over the last three years, Chinney Alliance Group Limited has shrunk its earnings per share by 13% per year. It achieved revenue growth of 29% over the last year.

Investors would be a bit wary of companies that have lower EPS 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 Chinney Alliance Group Limited Been A Good Investment?

The return of -46% over three years would not have pleased Chinney Alliance Group Limited shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

The loss to shareholders over the past three years is certainly concerning and possibly has something to do with the fact that the company's earnings haven't grown. The upcoming AGM will provide shareholders the opportunity to revisit the company’s remuneration policies and evaluate if the board’s judgement and decision-making is aligned with that of the company’s shareholders.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 3 warning signs (and 1 which makes us a bit uncomfortable) in Chinney Alliance Group we think you should know about.

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.