Yuk Yee Lo is the CEO of Finet Group Limited (HKG:8317), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
Check out our latest analysis for Finet Group
How Does Total Compensation For Yuk Yee Lo Compare With Other Companies In The Industry?
Our data indicates that Finet Group Limited has a market capitalization of HK$427m, and total annual CEO compensation was reported as HK$1.2m for the year to March 2020. We note that's a decrease of 31% compared to last year. In particular, the salary of HK$1.20m, 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$1.4m. So it looks like Finet Group compensates Yuk Yee Lo in line with the median for the industry.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | HK$1.2m | HK$1.8m | 97% |
| Other | HK$32k | HK$18k | 3% |
| Total Compensation | HK$1.2m | HK$1.8m | 100% |
Talking in terms of the industry, salary represented approximately 73% of total compensation out of all the companies we analyzed, while other remuneration made up 27% of the pie. Investors will find it interesting that Finet Group pays the bulk of its rewards through a traditional salary, instead of non-salary benefits. 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 Finet Group Limited's Growth Numbers
Finet Group Limited has seen its earnings per share (EPS) increase by 33% a year over the past three years. Its revenue is down 24% over the previous year.
This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Finet Group Limited Been A Good Investment?
Given the total shareholder loss of 19% over three years, many shareholders in Finet Group Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
Yuk Yee receives almost all of their compensation through a salary. As previously discussed, Yuk Yee is compensated close to the median for companies of its size, and which belong to the same industry. At the same time, the company has logged negative shareholder returns over the last three years. But EPS growth is moving in a favorable direction, certainly a positive sign. It's tough for us to say CEO compensation is too generous when EPS growth is positive, but negative investor returns will irk shareholders and reduce any chances of a raise.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 2 warning signs for Finet Group that investors should be aware of in a dynamic business environment.
Switching gears from Finet 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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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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About SEHK:8317
Finet Group
An investment holding company, develops, produces, and provides financial information services, advertising and investor relationship services, and technology solutions to corporate and retail clients in Hong Kong and the People's Republic of China.
Flawless balance sheet very low.
