Does Vedan International (Holdings)'s (HKG:2317) CEO Salary Compare Well With Industry Peers?

The CEO of Vedan International (Holdings) Limited (HKG:2317) is Kun-Hsiang Yang, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for Vedan International (Holdings)

How Does Total Compensation For Kun-Hsiang Yang Compare With Other Companies In The Industry?

At the time of writing, our data shows that Vedan International (Holdings) Limited has a market capitalization of HK$1.2b, and reported total annual CEO compensation of US$850k for the year to December 2019. That's a fairly small increase of 4.4% over the previous year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at US$380k.

On comparing similar-sized companies in the industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was US$202k. Hence, we can conclude that Kun-Hsiang Yang is remunerated higher than the industry median.

Speaking on an industry level, nearly 81% of total compensation represents salary, while the remainder of 19% is other remuneration. In Vedan International (Holdings)'s case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Vedan International (Holdings) Limited's Growth Numbers

Vedan International (Holdings) Limited has reduced its earnings per share by 20% a year over the last three years. In the last year, its revenue is down 2.1%.

The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 Vedan International (Holdings) Limited Been A Good Investment?

With a total shareholder return of 17% over three years, Vedan International (Holdings) Limited shareholders would, in general, be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

To Conclude...

As previously discussed, Kun-Hsiang is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Unfortunately, EPS has not grown in three years, failing to impress us. While shareholder returns are acceptable, they don't delight. So you can understand why we do not think CEO compensation is particularly modest!

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We've identified 3 warning signs for Vedan International (Holdings) that investors should be aware of in a dynamic business environment.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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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