Shareholders Will Probably Not Have Any Issues With Cosmo Lady (China) Holdings Company Limited's (HKG:2298) CEO Compensation
Key Insights
- Cosmo Lady (China) Holdings will host its Annual General Meeting on 30th of May
- Salary of CN¥652.0k is part of CEO Yaonan Zheng's total remuneration
- Total compensation is 65% below industry average
- Cosmo Lady (China) Holdings' three-year loss to shareholders was 40% while its EPS grew by 123% over the past three years
Performance at Cosmo Lady (China) Holdings Company Limited (HKG:2298) has been rather uninspiring recently and shareholders may be wondering how CEO Yaonan Zheng plans to fix this. They will get a chance to exercise their voting power to influence the future direction of the company in the next AGM on 30th of May. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. We think CEO compensation looks appropriate given the data we have put together.
Check out our latest analysis for Cosmo Lady (China) Holdings
Comparing Cosmo Lady (China) Holdings Company Limited's CEO Compensation With The Industry
Our data indicates that Cosmo Lady (China) Holdings Company Limited has a market capitalization of HK$490m, and total annual CEO compensation was reported as CN¥703k for the year to December 2024. We note that's an increase of 30% above last year. We note that the salary portion, which stands at CN¥652.0k constitutes the majority of total compensation received by the CEO.
On comparing similar-sized companies in the Hong Kong Luxury industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was CN¥2.0m. That is to say, Yaonan Zheng is paid under the industry median. Furthermore, Yaonan Zheng directly owns HK$6.6m worth of shares in the company, implying that they are deeply invested in the company's success.
| Component | 2024 | 2023 | Proportion (2024) |
| Salary | CN¥652k | CN¥493k | 93% |
| Other | CN¥51k | CN¥46k | 7% |
| Total Compensation | CN¥703k | CN¥539k | 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. Our data reveals that Cosmo Lady (China) Holdings allocates salary more or less in line with the wider market. 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 Look at Cosmo Lady (China) Holdings Company Limited's Growth Numbers
Over the past three years, Cosmo Lady (China) Holdings Company Limited has seen its earnings per share (EPS) grow by 123% per year. Its revenue is up 9.2% over the last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Cosmo Lady (China) Holdings Company Limited Been A Good Investment?
Few Cosmo Lady (China) Holdings Company Limited shareholders would feel satisfied with the return of -40% over three years. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
The fact that shareholders have earned a negative share price return is certainly disconcerting. The share price trend has diverged with the robust growth in EPS however, suggesting there may be other factors that could be driving the price performance. A key question may be why the fundamentals have not yet been reflected into the share price. In the upcoming AGM, shareholders should take this opportunity to raise these concerns with the board and revisit their investment thesis with regards to the company.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for Cosmo Lady (China) Holdings that investors should think about before committing capital to this stock.
Switching gears from Cosmo Lady (China) 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.
Valuation is complex, but we're here to simplify it.
Discover if Cosmo Lady (China) Holdings might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.
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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.