Some Shareholders May find It Hard To Increase Zhongtai Futures Company Limited's (HKG:1461) CEO Compensation This Year

Key Insights

• Zhongtai Futures will host its Annual General Meeting on 27th of June
• Salary of CN¥829.9k is part of CEO Qingbin Liu's total remuneration
• Total compensation is similar to the industry average
• Zhongtai Futures' total shareholder return over the past three years was 1.9% while its EPS grew by 33% over the past three years

Performance at Zhongtai Futures Company Limited (HKG:1461) has been reasonably good and CEO Qingbin Liu has done a decent job of steering the company in the right direction. As shareholders go into the upcoming AGM on 27th of June, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. We present our case of why we think CEO compensation looks fair.

View our latest analysis for Zhongtai Futures

Comparing Zhongtai Futures Company Limited's CEO Compensation With The Industry

Our data indicates that Zhongtai Futures Company Limited has a market capitalization of HK$491m, and total annual CEO compensation was reported as CN¥1.8m for the year to December 2023. Notably, that's an increase of 42% over the year before. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at CN¥830k.

For comparison, other companies in the Hong Kong Capital Markets industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of CN¥2.0m. This suggests that Zhongtai Futures remunerates its CEO largely in line with the industry average.

Component	2023	2022	Proportion (2023)
Salary	CN¥830k	CN¥795k	47%
Other	CN¥943k	CN¥450k	53%
Total Compensation	CN¥1.8m	CN¥1.2m	100%

Speaking on an industry level, nearly 83% of total compensation represents salary, while the remainder of 17% is other remuneration. In Zhongtai Futures' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Zhongtai Futures Company Limited's Growth

Over the past three years, Zhongtai Futures Company Limited has seen its earnings per share (EPS) grow by 33% per year. Its revenue is down 12% over the previous year.

Shareholders would be glad to know that the company has improved itself over the last few years. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. 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 Zhongtai Futures Company Limited Been A Good Investment?

With a total shareholder return of 1.9% over three years, Zhongtai Futures Company Limited has done okay by shareholders, but there's always room for improvement. As a result, investors in the company might be reluctant about agreeing to increase CEO pay in the future, before seeing an improvement on their returns.

To Conclude...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. Despite the pleasing results, we still think that any proposed increases to CEO compensation will be examined based on a case by case basis and linked to performance outcomes.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 1 warning sign for Zhongtai Futures that investors should look into moving forward.

Important note: Zhongtai Futures 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com