Shareholders May Be Wary Of Increasing Q P Group Holdings Limited's (HKG:1412) CEO Compensation Package

Key Insights

• Q P Group Holdings will host its Annual General Meeting on 7th of June
• CEO Wan Cheng's total compensation includes salary of HK$1.17m
• The overall pay is comparable to the industry average
• Over the past three years, Q P Group Holdings' EPS fell by 15% and over the past three years, the total loss to shareholders 3.5%

Q P Group Holdings Limited (HKG:1412) has not performed well recently and CEO Wan Cheng will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 7th of June. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. From our analysis, we think CEO compensation may need a review in light of the recent performance.

See our latest analysis for Q P Group Holdings

How Does Total Compensation For Wan Cheng Compare With Other Companies In The Industry?

Our data indicates that Q P Group Holdings Limited has a market capitalization of HK$564m, and total annual CEO compensation was reported as HK$2.3m for the year to December 2023. That's a slight decrease of 5.4% on the prior year. We think total compensation is more important but our data shows that the CEO salary is lower, at HK$1.2m.

In comparison with other companies in the Hong Kong Consumer Durables industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$2.3m. From this we gather that Wan Cheng is paid around the median for CEOs in the industry.

Component	2023	2022	Proportion (2023)
Salary	HK$1.2m	HK$1.2m	50%
Other	HK$1.2m	HK$1.3m	50%
Total Compensation	HK$2.3m	HK$2.5m	100%

Talking in terms of the industry, salary represented approximately 89% of total compensation out of all the companies we analyzed, while other remuneration made up 11% of the pie. It's interesting to note that Q P Group Holdings allocates a smaller portion of compensation to salary in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Q P Group Holdings Limited's Growth Numbers

Q P Group Holdings Limited has reduced its earnings per share by 15% a year over the last three years. Its revenue is down 19% over the previous year.

The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. 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 Q P Group Holdings Limited Been A Good Investment?

Since shareholders would have lost about 3.5% over three years, some Q P Group Holdings Limited investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. In our study, we found 3 warning signs for Q P Group Holdings you should be aware of, and 1 of them is potentially serious.

Switching gears from Q P 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. 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.