Billion Industrial Holdings Limited's (HKG:2299) CEO Compensation Looks Acceptable To Us And Here's Why

Key Insights

• Billion Industrial Holdings to hold its Annual General Meeting on 23rd of May
• CEO Jinbiao Wu's total compensation includes salary of CN¥1.20m
• The total compensation is 56% less than the average for the industry
• Over the past three years, Billion Industrial Holdings' EPS fell by 25% and over the past three years, the total loss to shareholders 14%

Our free stock report includes 1 warning sign investors should be aware of before investing in Billion Industrial Holdings. Read for free now.

Performance at Billion Industrial Holdings Limited (HKG:2299) has been rather uninspiring recently and shareholders may be wondering how CEO Jinbiao Wu 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 23rd of May. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. In our opinion, CEO compensation does not look excessive and we discuss why.

Check out our latest analysis for Billion Industrial Holdings

Comparing Billion Industrial Holdings Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Billion Industrial Holdings Limited has a market capitalization of HK$9.1b, and reported total annual CEO compensation of CN¥1.2m for the year to December 2024. That is, the compensation was roughly the same as last year. Notably, the salary which is CN¥1.20m, represents most of the total compensation being paid.

On examining similar-sized companies in the Hong Kong Luxury industry with market capitalizations between HK$3.1b and HK$13b, we discovered that the median CEO total compensation of that group was CN¥2.7m. That is to say, Jinbiao Wu is paid under the industry median. What's more, Jinbiao Wu holds HK$586m 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	CN¥1.2m	CN¥1.2m	99%
Other	CN¥16k	CN¥16k	1%
Total Compensation	CN¥1.2m	CN¥1.2m	100%

On an industry level, roughly 89% of total compensation represents salary and 11% is other remuneration. Billion Industrial 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.

Billion Industrial Holdings Limited's Growth

Over the last three years, Billion Industrial Holdings Limited has shrunk its earnings per share by 25% per year. In the last year, its revenue is up 16%.

The decrease in EPS could be a concern for some investors. On the other hand, the strong revenue growth suggests the business is growing. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. 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 Billion Industrial Holdings Limited Been A Good Investment?

Given the total shareholder loss of 14% over three years, many shareholders in Billion Industrial 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.

To Conclude...

Billion Industrial Holdings pays its CEO a majority of compensation through a salary. The decline in share price is rather disappointing to shareholders. One reason for the lacklustre price performance could be that earnings just haven't grown much. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board and assess if the board's plan is likely to improve company performance.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 1 warning sign for Billion Industrial Holdings that investors should be aware of in a dynamic business environment.

Important note: Billion Industrial 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. 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.