Does Sun Hing Printing Holdings' (HKG:1975) CEO Salary Compare Well With The Performance Of The Company?

This article will reflect on the compensation paid to Kenneth Chan who has served as CEO of Sun Hing Printing Holdings Limited (HKG:1975) since 2017. This analysis will also assess whether Sun Hing Printing Holdings pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Sun Hing Printing Holdings

Comparing Sun Hing Printing Holdings Limited's CEO Compensation With the industry

According to our data, Sun Hing Printing Holdings Limited has a market capitalization of HK$283m, and paid its CEO total annual compensation worth HK$6.7m over the year to June 2020. That's a modest increase of 7.4% on the prior year. Notably, the salary which is HK$6.52m, 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$1.5m. Accordingly, our analysis reveals that Sun Hing Printing Holdings Limited pays Kenneth Chan north of the industry median.

On an industry level, roughly 88% of total compensation represents salary and 12% is other remuneration. Sun Hing Printing Holdings pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Sun Hing Printing Holdings Limited's Growth Numbers

Sun Hing Printing Holdings Limited has reduced its earnings per share by 2.9% a year over the last three years. It achieved revenue growth of 11% over the last year.

The lack of EPS growth is certainly unimpressive. And while it's good to see some good revenue growth recently, the growth isn't really fast enough for us to put aside my concerns around EPS. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Sun Hing Printing Holdings Limited Been A Good Investment?

Given the total shareholder loss of 45% over three years, many shareholders in Sun Hing Printing Holdings Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Sun Hing Printing Holdings pays its CEO a majority of compensation through a salary. As we noted earlier, Sun Hing Printing 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. Arguably worse, we've been waiting for positive EPS growth for the last three years. Overall, with such poor performance, shareholder's would probably have questions if the company decided to give the CEO a raise.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 3 warning signs for Sun Hing Printing Holdings that investors should think about before committing capital to this stock.

Important note: Sun Hing Printing Holdings is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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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