We Discuss Why The CEO Of CGN Mining Company Limited (HKG:1164) Is Due For A Pay Rise

Key Insights

• CGN Mining will host its Annual General Meeting on 20th of June
• Total pay for CEO Junjing An includes HK$950.0k salary
• The overall pay is 33% below the industry average
• CGN Mining's total shareholder return over the past three years was 285% while its EPS grew by 41% over the past three years

The solid performance at CGN Mining Company Limited (HKG:1164) has been impressive and shareholders will probably be pleased to know that CEO Junjing An has delivered. This would be kept in mind at the upcoming AGM on 20th of June which will be a chance for them to hear the board review the financial results, discuss future company strategy and vote on resolutions such as executive remuneration and other matters. Here we will show why we think CEO compensation is appropriate and discuss the case for a pay rise.

See our latest analysis for CGN Mining

How Does Total Compensation For Junjing An Compare With Other Companies In The Industry?

According to our data, CGN Mining Company Limited has a market capitalization of HK$20b, and paid its CEO total annual compensation worth HK$950k over the year to December 2023. There was no change in the compensation compared to last year. Notably, the salary of HK$950k is the entirety of the CEO compensation.

On comparing similar companies from the Hong Kong Oil and Gas industry with market caps ranging from HK$16b to HK$50b, we found that the median CEO total compensation was HK$1.4m. Accordingly, CGN Mining pays its CEO under the industry median.

Component	2023	2022	Proportion (2023)
Salary	HK$950k	HK$950k	100%
Other	-	-	-
Total Compensation	HK$950k	HK$950k	100%

On an industry level, roughly 93% of total compensation represents salary and 7% is other remuneration. Speaking on a company level, CGN Mining prefers to tread along a traditional path, disbursing all compensation through a salary. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at CGN Mining Company Limited's Growth Numbers

CGN Mining Company Limited's earnings per share (EPS) grew 41% per year over the last three years. In the last year, its revenue is up 102%.

Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has CGN Mining Company Limited Been A Good Investment?

Most shareholders would probably be pleased with CGN Mining Company Limited for providing a total return of 285% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

In Summary...

CGN Mining rewards its CEO solely through a salary, ignoring non-salary benefits completely. Seeing that the company has put in a relatively good performance, the CEO remuneration policy may not be the focus at the AGM. In fact, strategic decisions that could impact the future of the business might be a far more interesting topic for investors as it would help them set their longer-term expectations.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 1 warning sign for CGN Mining that investors should look into moving forward.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.