The CEO of Ling Yui Holdings Limited (HKG:784) is Siu Hung Chan, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Ling Yui Holdings pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
Check out our latest analysis for Ling Yui Holdings
How Does Total Compensation For Siu Hung Chan Compare With Other Companies In The Industry?
At the time of writing, our data shows that Ling Yui Holdings Limited has a market capitalization of HK$232m, and reported total annual CEO compensation of HK$1.1m for the year to March 2020. That's a slight decrease of 3.7% on the prior year. Notably, the salary which is HK$960.0k, represents most of the total compensation being paid.
On comparing similar-sized companies in the industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was HK$2.0m. This suggests that Siu Hung Chan is paid below the industry median. Moreover, Siu Hung Chan also holds HK$17m worth of Ling Yui Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | HK$960k | HK$930k | 85% |
| Other | HK$175k | HK$248k | 15% |
| Total Compensation | HK$1.1m | HK$1.2m | 100% |
On an industry level, around 91% of total compensation represents salary and 8.7% is other remuneration. There isn't a significant difference between Ling Yui Holdings and the broader market, in terms of salary allocation in the overall compensation package. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Ling Yui Holdings Limited's Growth
Over the last three years, Ling Yui Holdings Limited has shrunk its earnings per share by 97% per year. It saw its revenue drop 1.1% over the last year.
Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Ling Yui Holdings Limited Been A Good Investment?
Given the total shareholder loss of 42% over three years, many shareholders in Ling Yui Holdings Limited are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
To Conclude...
As we touched on above, Ling Yui Holdings Limited is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. EPS growth has failed to impress us, and the same can be said about shareholder returns. It's tough to say that Siu Hung is earning a very high compensation, but shareholders will likely want to see healthier investor returns before agreeing that a raise is in order.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 5 warning signs for Ling Yui Holdings (of which 2 are a bit unpleasant!) that you should know about in order to have a holistic understanding of the stock.
Switching gears from Ling Yui 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. 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.
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About SEHK:784
Ling Yui Holdings
An investment holding company, engages in the provision of foundation engineering services in Hong Kong.
Adequate balance sheet and fair value.
