Key Things To Understand About Kiddieland International's (HKG:3830) CEO Pay Cheque

Kenneth Lo is the CEO of Kiddieland International Limited (HKG:3830), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also assess whether Kiddieland International pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Kiddieland International

How Does Total Compensation For Kenneth Lo Compare With Other Companies In The Industry?

According to our data, Kiddieland International Limited has a market capitalization of HK$190m, and paid its CEO total annual compensation worth HK$2.3m over the year to April 2020. That's a notable increase of 9.7% on last year. In particular, the salary of HK$2.14m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$2.0m. So it looks like Kiddieland International compensates Kenneth Lo in line with the median for the industry.

Speaking on an industry level, nearly 68% of total compensation represents salary, while the remainder of 32% is other remuneration. Kiddieland International is paying a higher share of its remuneration through a salary in comparison to the overall industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Kiddieland International Limited's Growth

Kiddieland International Limited has seen its earnings per share (EPS) increase by 142% a year over the past three years. It saw its revenue drop 7.1% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Kiddieland International Limited Been A Good Investment?

Boasting a total shareholder return of 43% over three years, Kiddieland International Limited has done well by shareholders. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

As we noted earlier, Kiddieland International pays its CEO in line with similar-sized companies belonging to the same industry. The company is growing EPS and total shareholder returns have been pleasing. So one could argue that CEO compensation is quite modest, if you consider company performance! In fact, shareholders might even think the CEO deserves a raise as a reward due to the fantastic returns generated.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 2 warning signs (and 1 which is significant) in Kiddieland International we think you should know about.

Important note: Kiddieland International 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. 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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