It Looks Like Modern Healthcare Technology Holdings Limited's (HKG:919) CEO May Expect Their Salary To Be Put Under The Microscope

Key Insights

• Modern Healthcare Technology Holdings' Annual General Meeting to take place on 28th of August
• Salary of HK$15.7m is part of CEO Joyce Tsang's total remuneration
• Total compensation is 697% above industry average
• Over the past three years, Modern Healthcare Technology Holdings' EPS fell by 90% and over the past three years, the total loss to shareholders 60%

The results at Modern Healthcare Technology Holdings Limited (HKG:919) have been quite disappointing recently and CEO Joyce Tsang bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 28th of August. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. The data we present below explains why we think CEO compensation is not consistent with recent performance.

View our latest analysis for Modern Healthcare Technology Holdings

Comparing Modern Healthcare Technology Holdings Limited's CEO Compensation With The Industry

According to our data, Modern Healthcare Technology Holdings Limited has a market capitalization of HK$85m, and paid its CEO total annual compensation worth HK$16m over the year to March 2024. We note that's an increase of 22% above last year. In particular, the salary of HK$15.7m, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the Hong Kong Consumer Services industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was HK$2.0m. This suggests that Joyce Tsang is paid more than the median for the industry. What's more, Joyce Tsang holds HK$64m 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$16m	HK$13m	99%
Other	HK$85k	HK$61k	1%
Total Compensation	HK$16m	HK$13m	100%

Talking in terms of the industry, salary represented approximately 84% of total compensation out of all the companies we analyzed, while other remuneration made up 16% of the pie. Modern Healthcare Technology Holdings 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.

A Look at Modern Healthcare Technology Holdings Limited's Growth Numbers

Modern Healthcare Technology Holdings Limited has reduced its earnings per share by 90% a year over the last three years. In the last year, its revenue is up 12%.

The decline in EPS is a bit concerning. While the revenue growth is good to see, it is outweighed by the fact that EPS are down, over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Modern Healthcare Technology Holdings Limited Been A Good Investment?

Few Modern Healthcare Technology Holdings Limited shareholders would feel satisfied with the return of -60% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Modern Healthcare Technology Holdings pays its CEO a majority of compensation through a salary. 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, the board will get the chance to explain the steps it plans to take to improve business performance.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 2 warning signs (and 1 which is potentially serious) in Modern Healthcare Technology Holdings we think you should know about.

Important note: Modern Healthcare Technology Holdings is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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.