Shareholders May Be More Conservative With Water Oasis Group Limited's (HKG:1161) CEO Compensation For Now

Key Insights

• Water Oasis Group's Annual General Meeting to take place on 2nd of February
• Total pay for CEO Alan Tam includes HK$4.95m salary
• Total compensation is 269% above industry average
• Water Oasis Group's EPS grew by 58% over the past three years while total shareholder return over the past three years was 114%

Under the guidance of CEO Alan Tam, Water Oasis Group Limited (HKG:1161) has performed reasonably well recently. As shareholders go into the upcoming AGM on 2nd of February, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still want to keep CEO compensation within reason.

See our latest analysis for Water Oasis Group

Comparing Water Oasis Group Limited's CEO Compensation With The Industry

At the time of writing, our data shows that Water Oasis Group Limited has a market capitalization of HK$953m, and reported total annual CEO compensation of HK$6.3m for the year to September 2023. Notably, that's a decrease of 31% over the year before. We note that the salary portion, which stands at HK$4.95m constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the Hong Kong Consumer Services industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was HK$1.7m. This suggests that Alan Tam is paid more than the median for the industry. What's more, Alan Tam holds HK$13m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	HK$4.9m	HK$4.7m	78%
Other	HK$1.4m	HK$4.5m	22%
Total Compensation	HK$6.3m	HK$9.2m	100%

Speaking on an industry level, nearly 82% of total compensation represents salary, while the remainder of 18% is other remuneration. Although there is a difference in how total compensation is set, Water Oasis Group more or less reflects the market in terms of setting the salary. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Water Oasis Group Limited's Growth Numbers

Water Oasis Group Limited has seen its earnings per share (EPS) increase by 58% a year over the past three years. In the last year, its revenue is up 16%.

Shareholders would be glad to know that the company has improved itself over the last few years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Water Oasis Group Limited Been A Good Investment?

Most shareholders would probably be pleased with Water Oasis Group Limited for providing a total return of 114% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for Water Oasis Group that you should be aware of before investing.

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.

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

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.