A Look At Ocean One Holding's (HKG:8476) CEO Remuneration

Kin Chan became the CEO of Ocean One Holding Ltd. (HKG:8476) in 2017, and we think it's a good time to look at 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 Ocean One Holding

How Does Total Compensation For Kin Chan Compare With Other Companies In The Industry?

According to our data, Ocean One Holding Ltd. has a market capitalization of HK$235m, and paid its CEO total annual compensation worth HK$902k over the year to March 2020. Notably, that's an increase of 13% over the year before. We note that the salary portion, which stands at HK$816.0k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$1.4m. Accordingly, Ocean One Holding pays its CEO under the industry median. Furthermore, Kin Chan directly owns HK$167m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, roughly 89% of total compensation represents salary and 11% is other remuneration. Although there is a difference in how total compensation is set, Ocean One Holding more or less reflects the market in terms of setting the salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Ocean One Holding Ltd.'s Growth

Ocean One Holding Ltd. has seen its earnings per share (EPS) increase by 22% a year over the past three years. It saw its revenue drop 4.8% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Ocean One Holding Ltd. Been A Good Investment?

We think that the total shareholder return of 42%, over three years, would leave most Ocean One Holding Ltd. 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.

To Conclude...

As we touched on above, Ocean One Holding Ltd. is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Considering robust EPS growth, we believe Kin to be modestly paid. Given the strong history of shareholder returns, the shareholders are probably very happy with Kin's performance.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 2 warning signs for Ocean One Holding that you should be aware of before investing.

Important note: Ocean One Holding 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.

If you decide to trade Ocean One Holding, use the lowest-cost* platform that is rated #1 Overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.