Shareholders Will Probably Be Cautious Of Increasing Bar Pacific Group Holdings Limited's (HKG:8432) CEO Compensation At The Moment

The underwhelming performance at Bar Pacific Group Holdings Limited (HKG:8432) recently has probably not pleased shareholders. The next AGM coming up on 12 August 2021 will be a chance for shareholders to have their concerns addressed by the board, challenge management on company strategy and vote on resolutions such as executive remuneration, which may help change the company's future prospects. From our analysis below, we think CEO compensation looks appropriate for now.

Check out our latest analysis for Bar Pacific Group Holdings

Comparing Bar Pacific Group Holdings Limited's CEO Compensation With the industry

Our data indicates that Bar Pacific Group Holdings Limited has a market capitalization of HK$60m, and total annual CEO compensation was reported as HK$802k for the year to March 2021. This means that the compensation hasn't changed much from last year. In particular, the salary of HK$724.0k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$1.8m. Accordingly, Bar Pacific Group Holdings pays its CEO under the industry median.

Component	2021	2020	Proportion (2021)
Salary	HK$724k	HK$717k	90%
Other	HK$78k	HK$76k	10%
Total Compensation	HK$802k	HK$793k	100%

On an industry level, around 90% of total compensation represents salary and 10% is other remuneration. There isn't a significant difference between Bar Pacific Group Holdings and the broader market, in terms of salary allocation in the overall compensation package. 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.

A Look at Bar Pacific Group Holdings Limited's Growth Numbers

Bar Pacific Group Holdings Limited has reduced its earnings per share by 88% a year over the last three years. It saw its revenue drop 65% over the last year.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation 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 Bar Pacific Group Holdings Limited Been A Good Investment?

With a total shareholder return of -35% over three years, Bar Pacific Group Holdings Limited shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 4 warning signs for Bar Pacific Group Holdings (of which 3 can't be ignored!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from Bar Pacific Group 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. 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.
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