In 2013 Filipin Torralba was appointed CEO of San Miguel Brewery Hong Kong Limited (HKG:236). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we’ll look at a snap shot of the business growth. Third, we’ll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Filipin Torralba’s Compensation Compare With Similar Sized Companies?
At the time of writing, our data says that San Miguel Brewery Hong Kong Limited has a market cap of HK$392m, and reported total annual CEO compensation of HK$2.6m for the year to December 2018. Notably, the salary of HK$2.6m is the vast majority of the CEO compensation. We took a group of companies with market capitalizations below HK$1.6b, and calculated the median CEO total compensation to be HK$1.7m.
As you can see, Filipin Torralba is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean San Miguel Brewery Hong Kong Limited is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see a visual representation of the CEO compensation at San Miguel Brewery Hong Kong, below.
Is San Miguel Brewery Hong Kong Limited Growing?
San Miguel Brewery Hong Kong Limited has reduced its earnings per share by an average of 110% a year, over the last three years (measured with a line of best fit). Its revenue is up 1.7% over last year.
Unfortunately, earnings per share have trended lower over the last three years. And the modest revenue growth over 12 months isn’t much comfort against the reduced earnings per share. These factors suggest that the business performance wouldn’t really justify a high pay packet for the CEO. Although we don’t have analyst forecasts you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has San Miguel Brewery Hong Kong Limited Been A Good Investment?
With a three year total loss of 13%, San Miguel Brewery Hong Kong Limited would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn’t be too generous with CEO compensation.
We examined the amount San Miguel Brewery Hong Kong Limited pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group.
We think many shareholders would be underwhelmed with the business growth over the last three years. Just as bad, share price gains for investors have failed to materialize, over the same period. In our opinion the CEO might be paid too generously! So you may want to check if insiders are buying San Miguel Brewery Hong Kong shares with their own money (free access).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Simply Wall St has no position in the stocks mentioned.
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