Here's Why Shareholders Should Examine Century Legend (Holdings) Limited's (HKG:79) CEO Compensation Package More Closely

Key Insights

• Century Legend (Holdings) will host its Annual General Meeting on 30th of May
• Total pay for CEO Samuel Tsang includes HK$3.72m salary
• The overall pay is 72% above the industry average
• Over the past three years, Century Legend (Holdings)'s EPS fell by 15% and over the past three years, the total loss to shareholders 4.6%

We've discovered 3 warning signs about Century Legend (Holdings). View them for free.

The results at Century Legend (Holdings) Limited (HKG:79) have been quite disappointing recently and CEO Samuel Tsang bears some responsibility for this. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 30th of May. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. The data we present below explains why we think CEO compensation is not consistent with recent performance.

Check out our latest analysis for Century Legend (Holdings)

Comparing Century Legend (Holdings) Limited's CEO Compensation With The Industry

According to our data, Century Legend (Holdings) Limited has a market capitalization of HK$41m, and paid its CEO total annual compensation worth HK$4.0m over the year to December 2024. This was the same as last year. In particular, the salary of HK$3.72m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the Hong Kong Consumer Services industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$2.3m. This suggests that Samuel Tsang is paid more than the median for the industry. What's more, Samuel Tsang holds HK$20m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2024	2023	Proportion (2024)
Salary	HK$3.7m	HK$3.7m	94%
Other	HK$252k	HK$252k	6%
Total Compensation	HK$4.0m	HK$4.0m	100%

Talking in terms of the industry, salary represented approximately 81% of total compensation out of all the companies we analyzed, while other remuneration made up 19% of the pie. It's interesting to note that Century Legend (Holdings) pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Century Legend (Holdings) Limited's Growth

Over the last three years, Century Legend (Holdings) Limited has shrunk its earnings per share by 15% per year. Its revenue is down 9.4% over the previous year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Century Legend (Holdings) Limited Been A Good Investment?

Since shareholders would have lost about 4.6% over three years, some Century Legend (Holdings) Limited investors would surely be feeling negative emotions. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 3 warning signs for Century Legend (Holdings) (of which 2 are concerning!) that you should know about in order to have a holistic understanding of the stock.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.