Here's Why Shareholders May Want To Be Cautious With Increasing Samsonite Group S.A.'s (HKG:1910) CEO Pay Packet
Key Insights
- Samsonite Group to hold its Annual General Meeting on 3rd of June
- CEO Kyle Gendreau's total compensation includes salary of US$1.50m
- Total compensation is 3,603% above industry average
- Samsonite Group's three-year loss to shareholders was 19% while its EPS grew by 46% over the past three years
Shareholders of Samsonite Group S.A. (HKG:1910) will have been dismayed by the negative share price return over the last three years. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. These are some of the concerns that shareholders may want to bring up at the next AGM held on 3rd of June. Voting on resolutions such as executive remuneration and other matters could also be a way to influence management. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.
View our latest analysis for Samsonite Group
How Does Total Compensation For Kyle Gendreau Compare With Other Companies In The Industry?
At the time of writing, our data shows that Samsonite Group S.A. has a market capitalization of HK$20b, and reported total annual CEO compensation of US$12m for the year to December 2024. Notably, that's an increase of 9.3% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at US$1.5m.
On comparing similar companies from the Hong Kong Luxury industry with market caps ranging from HK$16b to HK$50b, we found that the median CEO total compensation was US$316k. Hence, we can conclude that Kyle Gendreau is remunerated higher than the industry median. What's more, Kyle Gendreau holds HK$29m 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 | US$1.5m | US$1.4m | 13% |
| Other | US$10m | US$9.3m | 87% |
| Total Compensation | US$12m | US$11m | 100% |
Speaking on an industry level, nearly 89% of total compensation represents salary, while the remainder of 11% is other remuneration. Samsonite Group sets aside a smaller share of compensation for salary, in comparison to the overall industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
Samsonite Group S.A.'s Growth
Samsonite Group S.A.'s earnings per share (EPS) grew 46% per year over the last three years. It saw its revenue drop 4.5% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Samsonite Group S.A. Been A Good Investment?
Given the total shareholder loss of 19% over three years, many shareholders in Samsonite Group S.A. are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be less generous with CEO compensation.
To Conclude...
The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. These concerns should be addressed at the upcoming AGM, where shareholders can question the board and evaluate if their judgement and decision making is still 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 Samsonite Group that you should be aware of before investing.
Switching gears from Samsonite Group, 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.
Valuation is complex, but we're here to simplify it.
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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.