How Is Convenience Retail Asia's (HKG:831) CEO Compensated?

Richard Yeung is the CEO of Convenience Retail Asia Limited (HKG:831), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. 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 Convenience Retail Asia

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

According to our data, Convenience Retail Asia Limited has a market capitalization of HK$3.6b, and paid its CEO total annual compensation worth HK$15m over the year to December 2019. That's a modest increase of 6.8% on the prior year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at HK$4.0m.

For comparison, other companies in the same industry with market capitalizations ranging between HK$1.6b and HK$6.2b had a median total CEO compensation of HK$8.1m. Hence, we can conclude that Richard Yeung is remunerated higher than the industry median. Furthermore, Richard Yeung directly owns HK$104m worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the industry, salary represented approximately 89% of total compensation out of all the companies we analyzed, while other remuneration made up 11% of the pie. It's interesting to note that Convenience Retail Asia allocates a smaller portion of compensation to salary in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

Convenience Retail Asia Limited's Growth

Over the past three years, Convenience Retail Asia Limited has seen its earnings per share (EPS) grow by 12% per year. In the last year, its revenue is up 6.2%.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Convenience Retail Asia Limited Been A Good Investment?

We think that the total shareholder return of 60%, over three years, would leave most Convenience Retail Asia Limited shareholders smiling. 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.

In Summary...

As we touched on above, Convenience Retail Asia 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. But EPS growth and shareholder returns have been top-notch for the past three years. So, in acknowledgment of the overall excellent performance, we believe CEO compensation is appropriate. And given most shareholders are probably very happy with recent returns, they might even think that Richard deserves a raise!

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 Convenience Retail Asia that investors should look into moving forward.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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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