Most Shareholders Will Probably Agree With Ajisen (China) Holdings Limited's (HKG:538) CEO Compensation

Key Insights

• Ajisen (China) Holdings to hold its Annual General Meeting on 13th of June
• CEO Wai Poon's total compensation includes salary of CN¥1.81m
• Total compensation is 60% below industry average
• Ajisen (China) Holdings' three-year loss to shareholders was 9.3% while its EPS grew by 41% over the past three years

The performance at Ajisen (China) Holdings Limited (HKG:538) has been rather lacklustre of late and shareholders may be wondering what CEO Wai Poon is planning to do about this. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 13th of June. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. We have prepared some analysis below to show that CEO compensation looks to be reasonable.

View our latest analysis for Ajisen (China) Holdings

How Does Total Compensation For Wai Poon Compare With Other Companies In The Industry?

Our data indicates that Ajisen (China) Holdings Limited has a market capitalization of HK$1.2b, and total annual CEO compensation was reported as CN¥1.9m for the year to December 2023. That's a fairly small increase of 6.0% over the previous year. Notably, the salary which is CN¥1.81m, represents most of the total compensation being paid.

For comparison, other companies in the Hong Kong Hospitality industry with market capitalizations ranging between HK$781m and HK$3.1b had a median total CEO compensation of CN¥4.8m. Accordingly, Ajisen (China) Holdings pays its CEO under the industry median. Furthermore, Wai Poon directly owns HK$43m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	CN¥1.8m	CN¥1.7m	95%
Other	CN¥92k	CN¥122k	5%
Total Compensation	CN¥1.9m	CN¥1.8m	100%

Speaking on an industry level, nearly 87% of total compensation represents salary, while the remainder of 13% is other remuneration. Ajisen (China) Holdings is focused on going down a more traditional approach and is paying a higher portion of compensation through salary, as compared to non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Ajisen (China) Holdings Limited's Growth Numbers

Ajisen (China) Holdings Limited's earnings per share (EPS) grew 41% per year over the last three years. Its revenue is up 27% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Ajisen (China) Holdings Limited Been A Good Investment?

With a three year total loss of 9.3% for the shareholders, Ajisen (China) Holdings Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Ajisen (China) Holdings pays its CEO a majority of compensation through a salary. The uninspiring share price returns contrasts with the strong EPS growth, suggesting that there may be other factors at play causing it to diverge from fundamentals. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board and assess if the board's plan is likely to improve company performance.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 2 warning signs for Ajisen (China) Holdings you should be aware of, and 1 of them is a bit unpleasant.

Switching gears from Ajisen (China) Holdings, 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.