What Can We Conclude About Speedy Global Holdings' (HKG:540) CEO Pay?

The CEO of Speedy Global Holdings Limited (HKG:540) is Chih Shen Huang, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for Speedy Global Holdings

How Does Total Compensation For Chih Shen Huang Compare With Other Companies In The Industry?

According to our data, Speedy Global Holdings Limited has a market capitalization of HK$120m, and paid its CEO total annual compensation worth HK$5.7m over the year to December 2019. We note that's an increase of 15% above last year. We note that the salary portion, which stands at HK$4.17m constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$2.4m. Accordingly, our analysis reveals that Speedy Global Holdings Limited pays Chih Shen Huang north of the industry median. Furthermore, Chih Shen Huang directly owns HK$58m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 93% of total compensation represents salary and 7.4% is other remuneration. In Speedy Global Holdings' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Speedy Global Holdings Limited's Growth

Speedy Global Holdings Limited has reduced its earnings per share by 80% a year over the last three years. Its revenue is up 10% over the last year.

The decline in EPS is a bit concerning. While the revenue growth is good to see, it is outweighed by the fact that EPS are down, over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation 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 Speedy Global Holdings Limited Been A Good Investment?

With a three year total loss of 74% for the shareholders, Speedy Global Holdings Limited would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

As we touched on above, Speedy Global Holdings Limited is currently paying its CEO higher than the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Disappointingly, share price gains over the last three years have failed to materialize. Add to that declining EPS growth, and you have the perfect recipe for shareholder irritation. Overall, with such poor performance, shareholder's would probably have questions if the company decided to give the CEO a raise.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 4 warning signs for Speedy Global Holdings you should be aware of, and 2 of them are concerning.

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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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