How Does Wison Engineering Services' (HKG:2236) CEO Salary Compare to Peers?

Wei Rong has been the CEO of Wison Engineering Services Co. Ltd. (HKG:2236) since 2018, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also assess whether Wison Engineering Services pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Wison Engineering Services

Comparing Wison Engineering Services Co. Ltd.'s CEO Compensation With the industry

At the time of writing, our data shows that Wison Engineering Services Co. Ltd. has a market capitalization of HK$3.1b, and reported total annual CEO compensation of CN¥2.1m for the year to December 2019. Notably, that's an increase of 8.5% over the year before. Notably, the salary which is CN¥1.77m, represents most of the total compensation being paid.

For comparison, other companies in the same industry with market capitalizations ranging between HK$1.6b and HK$6.2b had a median total CEO compensation of CN¥2.1m. This suggests that Wison Engineering Services remunerates its CEO largely in line with the industry average.

Talking in terms of the industry, salary represented approximately 63% of total compensation out of all the companies we analyzed, while other remuneration made up 37% of the pie. Wison Engineering Services pays out 85% of remuneration in the form of a salary, significantly higher than the industry average. 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 Wison Engineering Services Co. Ltd.'s Growth Numbers

Wison Engineering Services Co. Ltd. has seen its earnings per share (EPS) increase by 11% a year over the past three years. It achieved revenue growth of 40% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. 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 Wison Engineering Services Co. Ltd. Been A Good Investment?

With a three year total loss of 49% for the shareholders, Wison Engineering Services Co. Ltd. would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

As we touched on above, Wison Engineering Services Co. Ltd. is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. At the same time, the company has logged negative shareholder returns over the last three years. However, EPS growth is positive over the same time frame. Overall, we wouldn't say Wei is paid an unjustified compensation, but shareholders might not favor a raise before shareholder returns show a positive trend.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 3 warning signs for Wison Engineering Services you should be aware of, and 2 of them are potentially serious.

Important note: Wison Engineering Services 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. 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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