A Quick Analysis On A.Plus Group Holdings' (HKG:1841) CEO Compensation

This article will reflect on the compensation paid to Wing Kong Fong who has served as CEO of A.Plus Group Holdings Limited (HKG:1841) since 2017. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for A.Plus Group Holdings.

Check out our latest analysis for A.Plus Group Holdings

How Does Total Compensation For Wing Kong Fong Compare With Other Companies In The Industry?

According to our data, A.Plus Group Holdings Limited has a market capitalization of HK$152m, and paid its CEO total annual compensation worth HK$2.4m over the year to March 2020. We note that's an increase of 21% above last year. We note that the salary portion, which stands at HK$1.44m constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$1.5m. Accordingly, our analysis reveals that A.Plus Group Holdings Limited pays Wing Kong Fong north of the industry median.

Speaking on an industry level, nearly 89% of total compensation represents salary, while the remainder of 11% is other remuneration. A.Plus Group Holdings pays a modest slice of remuneration through salary, as compared to the broader 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.Plus Group Holdings Limited's Growth

Over the last three years, A.Plus Group Holdings Limited has shrunk its earnings per share by 8.7% per year. It saw its revenue drop 7.6% over the last year.

The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has A.Plus Group Holdings Limited Been A Good Investment?

With a three year total loss of 26% for the shareholders, A.Plus Group Holdings Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

As we noted earlier, A.Plus Group Holdings pays its CEO higher than the norm for similar-sized companies belonging to the same industry. Disappointingly, share price gains over the last three years have failed to materialize. Add to that declining EPS growth, and you have the perfect recipe for shareholder irritation. Overall, with such poor performance, shareholder's would probably have questions if the company decided to give the CEO a raise.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 3 warning signs for A.Plus Group Holdings that investors should think about before committing capital to this stock.

Switching gears from A.Plus Group 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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