We Discuss Whether Kaisun Holdings Limited's (HKG:8203) CEO Is Due For A Pay Rise

Key Insights

• Kaisun Holdings will host its Annual General Meeting on 28th of June
• Salary of HK$600.0k is part of CEO Philip Ching's total remuneration
• The total compensation is 55% less than the average for the industry
• Kaisun Holdings' total shareholder return over the past three years was 157% while its EPS grew by 27% over the past three years

The impressive results at Kaisun Holdings Limited (HKG:8203) recently will be great news for shareholders. At the upcoming AGM on 28th of June, they will get a chance to hear the board review the company results, discuss future strategy and cast their vote on any resolutions such as executive remuneration. Here we will show why we think CEO compensation is appropriate and discuss the case for a pay rise.

Check out our latest analysis for Kaisun Holdings

How Does Total Compensation For Philip Ching Compare With Other Companies In The Industry?

Our data indicates that Kaisun Holdings Limited has a market capitalization of HK$228m, and total annual CEO compensation was reported as HK$668k for the year to December 2023. There was no change in the compensation compared to last year. Notably, the salary which is HK$600.0k, represents most of the total compensation being paid.

On comparing similar-sized companies in the Hong Kong Oil and Gas industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was HK$1.5m. That is to say, Philip Ching is paid under the industry median.

Component	2023	2022	Proportion (2023)
Salary	HK$600k	HK$600k	90%
Other	HK$68k	HK$68k	10%
Total Compensation	HK$668k	HK$668k	100%

Speaking on an industry level, nearly 93% of total compensation represents salary, while the remainder of 7% is other remuneration. There isn't a significant difference between Kaisun Holdings and the broader market, in terms of salary allocation in the overall compensation package. 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 Kaisun Holdings Limited's Growth Numbers

Kaisun Holdings Limited's earnings per share (EPS) grew 27% per year over the last three years. In the last year, its revenue is up 12%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. 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 Kaisun Holdings Limited Been A Good Investment?

Boasting a total shareholder return of 157% over three years, Kaisun Holdings Limited has done well by shareholders. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Given the improved performance, shareholders may be more forgiving of CEO compensation in the upcoming AGM. In saying that, some shareholders may feel that the more important issues to be addressed may be how the management plans to steer the company towards sustainable profitability in the future.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 2 warning signs for Kaisun Holdings (1 is concerning!) that you should be aware of before investing here.

Important note: Kaisun 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.

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