Wai Chun Chan is the CEO of Taste Gourmet Group Limited (HKG:8371), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Taste Gourmet Group.
View our latest analysis for Taste Gourmet Group
Comparing Taste Gourmet Group Limited's CEO Compensation With the industry
At the time of writing, our data shows that Taste Gourmet Group Limited has a market capitalization of HK$488m, and reported total annual CEO compensation of HK$1.8m for the year to March 2020. This means that the compensation hasn't changed much from last year. Notably, the salary which is HK$1.80m, represents most of the total compensation being paid.
For comparison, other companies in the industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$1.9m. This suggests that Taste Gourmet Group remunerates its CEO largely in line with the industry average.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | HK$1.8m | HK$1.8m | 99% |
| Other | HK$18k | HK$18k | 1% |
| Total Compensation | HK$1.8m | HK$1.8m | 100% |
On an industry level, roughly 87% of total compensation represents salary and 13% is other remuneration. Taste Gourmet Group pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
Taste Gourmet Group Limited's Growth
Taste Gourmet Group Limited's earnings per share (EPS) grew 41% per year over the last three years. In the last year, its revenue is down 6.1%.
This demonstrates that the company has been improving recently and is good news for the shareholders. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Taste Gourmet Group Limited Been A Good Investment?
Boasting a total shareholder return of 66% over three years, Taste Gourmet Group Limited has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
To Conclude...
Taste Gourmet Group pays its CEO a majority of compensation through a salary. As previously discussed, Wai Chun is compensated close to the median for companies of its size, and which belong to the same industry. Investors would surely be happy to see that returns have been great, and that EPS is up. Indeed, many might consider that Wai Chun is compensated rather modestly, given the solid company performance! In fact, shareholders might even think the CEO deserves a raise as a reward due to the fantastic returns generated.
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 3 warning signs for Taste Gourmet Group that you should be aware of before investing.
Switching gears from Taste Gourmet 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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About SEHK:8371
Taste Gourmet Group
An investment holding company, operates full-service restaurants and kiosks in Hong Kong and China.
Good value with adequate balance sheet and pays a dividend.
