How Much Did Citychamp Watch & Jewellery Group's (HKG:256) CEO Pocket Last Year?

The CEO of Citychamp Watch & Jewellery Group Limited (HKG:256) is Jianguang Shang, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Citychamp Watch & Jewellery Group.

Check out our latest analysis for Citychamp Watch & Jewellery Group

How Does Total Compensation For Jianguang Shang Compare With Other Companies In The Industry?

Our data indicates that Citychamp Watch & Jewellery Group Limited has a market capitalization of HK$6.9b, and total annual CEO compensation was reported as HK$14m for the year to December 2019. That is, the compensation was roughly the same as last year. We note that the salary portion, which stands at HK$14.1m constitutes the majority of total compensation received by the CEO.

On comparing similar companies from the same industry with market caps ranging from HK$3.1b to HK$12b, we found that the median CEO total compensation was HK$2.8m. Accordingly, our analysis reveals that Citychamp Watch & Jewellery Group Limited pays Jianguang Shang north of the industry median. Furthermore, Jianguang Shang directly owns HK$8.4m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, roughly 93% of total compensation represents salary and 7.4% is other remuneration. Citychamp Watch & Jewellery Group has gone down a largely traditional route, paying Jianguang Shang a high salary, giving it preference over non-salary benefits. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Citychamp Watch & Jewellery Group Limited's Growth Numbers

Over the last three years, Citychamp Watch & Jewellery Group Limited has shrunk its earnings per share by 70% per year. Its revenue is down 27% over the previous year.

Few shareholders would be pleased to read that EPS have declined. 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. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Citychamp Watch & Jewellery Group Limited Been A Good Investment?

Since shareholders would have lost about 11% over three years, some Citychamp Watch & Jewellery Group Limited investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Citychamp Watch & Jewellery Group pays its CEO a majority of compensation through a salary. As we noted earlier, Citychamp Watch & Jewellery Group pays its CEO higher than the norm for similar-sized companies belonging to the same industry. This doesn't look good against shareholder returns, which have been negative for the past three years. What's equally worrying is that the company isn't growing by our analysis. Considering such poor performance, we think shareholders might be concerned if the CEO's compensation were to grow.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for Citychamp Watch & Jewellery Group that investors should look into moving forward.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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This article by Simply Wall St is general in nature. 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.
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