It's Unlikely That PPS International (Holdings) Limited's (HKG:8201) CEO Will See A Huge Pay Rise This Year

Key Insights

• PPS International (Holdings) to hold its Annual General Meeting on 28th of November
• CEO Shaoheng Yu's total compensation includes salary of HK$668.0k
• Total compensation is 54% above industry average
• PPS International (Holdings)'s EPS declined by 110% over the past three years while total shareholder loss over the past three years was 45%

In the past three years, the share price of PPS International (Holdings) Limited (HKG:8201) has struggled to grow and now shareholders are sitting on a loss. In addition, the company's per-share earnings growth is not looking good, despite growing revenues. Shareholders will have a chance to take their concerns to the board at the next AGM on 28th of November and vote on resolutions including executive compensation, which studies show may have an impact on company performance. Here's why we think shareholders should hold off on a raise for the CEO at the moment.

Check out our latest analysis for PPS International (Holdings)

How Does Total Compensation For Shaoheng Yu Compare With Other Companies In The Industry?

At the time of writing, our data shows that PPS International (Holdings) Limited has a market capitalization of HK$31m, and reported total annual CEO compensation of HK$2.8m for the year to June 2024. We note that's an increase of 35% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at HK$668k.

For comparison, other companies in the Hong Kong Commercial Services industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$1.8m. Accordingly, our analysis reveals that PPS International (Holdings) Limited pays Shaoheng Yu north of the industry median. What's more, Shaoheng Yu holds HK$23m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2024	2023	Proportion (2024)
Salary	HK$668k	HK$702k	24%
Other	HK$2.1m	HK$1.3m	76%
Total Compensation	HK$2.8m	HK$2.0m	100%

On an industry level, around 81% of total compensation represents salary and 19% is other remuneration. PPS International (Holdings) pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at PPS International (Holdings) Limited's Growth Numbers

Over the last three years, PPS International (Holdings) Limited has shrunk its earnings per share by 110% per year. Its revenue is up 23% over the last year.

The decrease in EPS could be a concern for some investors. 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. 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 PPS International (Holdings) Limited Been A Good Investment?

Few PPS International (Holdings) Limited shareholders would feel satisfied with the return of -45% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

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. In 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 is in line with their expectations.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 2 warning signs for PPS International (Holdings) that you should be aware of before investing.

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.