This Is The Reason Why We Think Scholar Education Group's (HKG:1769) CEO Deserves A Bump Up To Their Compensation

Key Insights

• Scholar Education Group will host its Annual General Meeting on 20th of May
• Salary of CN¥336.0k is part of CEO Mingzhi Qi's total remuneration
• The total compensation is 82% less than the average for the industry
• Over the past three years, Scholar Education Group's EPS grew by 82% and over the past three years, the total shareholder return was 926%

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The solid performance at Scholar Education Group (HKG:1769) has been impressive and shareholders will probably be pleased to know that CEO Mingzhi Qi has delivered. At the upcoming AGM on 20th of May, they will get a chance to hear the board review the company results, discuss future strategy and cast their vote on any resolutions such as executive remuneration. Here we will show why we think CEO compensation is appropriate and discuss the case for a pay rise.

View our latest analysis for Scholar Education Group

How Does Total Compensation For Mingzhi Qi Compare With Other Companies In The Industry?

Our data indicates that Scholar Education Group has a market capitalization of HK$2.5b, and total annual CEO compensation was reported as CN¥375k for the year to December 2024. Notably, that's a decrease of 29% over the year before. Notably, the salary which is CN¥336.0k, represents most of the total compensation being paid.

For comparison, other companies in the Hong Kong Consumer Services industry with market capitalizations ranging between HK$1.6b and HK$6.2b had a median total CEO compensation of CN¥2.1m. This suggests that Mingzhi Qi is paid below the industry median. Furthermore, Mingzhi Qi directly owns HK$57m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	CN¥336k	CN¥345k	90%
Other	CN¥39k	CN¥180k	10%
Total Compensation	CN¥375k	CN¥525k	100%

Speaking on an industry level, nearly 83% of total compensation represents salary, while the remainder of 17% is other remuneration. Although there is a difference in how total compensation is set, Scholar Education Group more or less reflects the market in terms of setting the salary. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Scholar Education Group's Growth

Scholar Education Group's earnings per share (EPS) grew 82% per year over the last three years. In the last year, its revenue is up 49%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Scholar Education Group Been A Good Investment?

Most shareholders would probably be pleased with Scholar Education Group for providing a total return of 926% over three years. 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...

Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Scholar Education Group (free visualization of insider trades).

Switching gears from Scholar Education Group, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.