We Think Vitasoy International Holdings Limited's (HKG:345) CEO Compensation Package Needs To Be Put Under A Microscope

Key Insights

• Vitasoy International Holdings' Annual General Meeting to take place on 19th of August
• Salary of HK$7.69m is part of CEO Roberto Guidetti's total remuneration
• Total compensation is 425% above industry average
• Vitasoy International Holdings' three-year loss to shareholders was 73% while its EPS was down 40% over the past three years

Vitasoy International Holdings Limited (HKG:345) has not performed well recently and CEO Roberto Guidetti will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 19th of August. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. We present the case why we think CEO compensation is out of sync with company performance.

Check out our latest analysis for Vitasoy International Holdings

How Does Total Compensation For Roberto Guidetti Compare With Other Companies In The Industry?

At the time of writing, our data shows that Vitasoy International Holdings Limited has a market capitalization of HK$5.7b, and reported total annual CEO compensation of HK$22m for the year to March 2024. We note that's an increase of 23% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at HK$7.7m.

In comparison with other companies in the Hong Kong Food industry with market capitalizations ranging from HK$3.1b to HK$12b, the reported median CEO total compensation was HK$4.1m. Accordingly, our analysis reveals that Vitasoy International Holdings Limited pays Roberto Guidetti north of the industry median. Moreover, Roberto Guidetti also holds HK$33m worth of Vitasoy International Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2024	2023	Proportion (2024)
Salary	HK$7.7m	HK$7.5m	35%
Other	HK$14m	HK$10m	65%
Total Compensation	HK$22m	HK$18m	100%

Speaking on an industry level, nearly 72% of total compensation represents salary, while the remainder of 28% is other remuneration. Vitasoy International Holdings sets aside a smaller share of compensation for salary, in comparison to the overall industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Vitasoy International Holdings Limited's Growth

Vitasoy International Holdings Limited has reduced its earnings per share by 40% a year over the last three years. In the last year, its revenue is down 1.9%.

The decline in EPS is a bit concerning. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 Vitasoy International Holdings Limited Been A Good Investment?

With a total shareholder return of -73% over three years, Vitasoy International Holdings Limited shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Vitasoy International Holdings (free visualization of insider trades).

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. 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.