Should Shareholders Reconsider Bauhaus International (Holdings) Limited's (HKG:483) CEO Compensation Package?

Key Insights

• Bauhaus International (Holdings)'s Annual General Meeting to take place on 19th of August
• CEO Yat Hang Yeung's total compensation includes salary of HK$1.43m
• The total compensation is similar to the average for the industry
• Bauhaus International (Holdings)'s EPS declined by 77% over the past three years while total shareholder loss over the past three years was 24%

The results at Bauhaus International (Holdings) Limited (HKG:483) have been quite disappointing recently and CEO Yat Hang Yeung bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 19th of August. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. We present the case why we think CEO compensation is out of sync with company performance.

Check out our latest analysis for Bauhaus International (Holdings)

How Does Total Compensation For Yat Hang Yeung Compare With Other Companies In The Industry?

Our data indicates that Bauhaus International (Holdings) Limited has a market capitalization of HK$103m, and total annual CEO compensation was reported as HK$1.6m for the year to March 2024. We note that's a decrease of 32% compared to last year. In particular, the salary of HK$1.43m, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Hong Kong Luxury industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$1.9m. This suggests that Bauhaus International (Holdings) remunerates its CEO largely in line with the industry average. What's more, Yat Hang Yeung holds HK$1.4m 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	HK$1.4m	HK$2.2m	91%
Other	HK$138k	HK$118k	9%
Total Compensation	HK$1.6m	HK$2.3m	100%

Speaking on an industry level, nearly 91% of total compensation represents salary, while the remainder of 9% is other remuneration. Bauhaus International (Holdings) is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Bauhaus International (Holdings) Limited's Growth Numbers

Over the last three years, Bauhaus International (Holdings) Limited has shrunk its earnings per share by 77% per year. In the last year, its revenue is down 1.8%.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. 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 Bauhaus International (Holdings) Limited Been A Good Investment?

Given the total shareholder loss of 24% over three years, many shareholders in Bauhaus International (Holdings) Limited are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 3 warning signs for Bauhaus International (Holdings) that investors should be aware of in a dynamic business environment.

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. 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.