This article will reflect on the compensation paid to Shao Feng Sun who has served as CEO of China Green (Holdings) Limited (HKG:904) since 1998. This analysis will also assess whether China Green (Holdings) pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
View our latest analysis for China Green (Holdings)
How Does Total Compensation For Shao Feng Sun Compare With Other Companies In The Industry?
Our data indicates that China Green (Holdings) Limited has a market capitalization of HK$37m, and total annual CEO compensation was reported as CN„6.6m for the year to April 2020. That's a modest increase of 4.7% on the prior year. In particular, the salary of CN„6.05m, makes up a huge portion of the total compensation being paid to the CEO.
For comparison, other companies in the industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of CN„1.3m. Hence, we can conclude that Shao Feng Sun is remunerated higher than the industry median. Moreover, Shao Feng Sun also holds HK$2.0m worth of China Green (Holdings) stock directly under their own name.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | CN„6.1m | CN„5.7m | 92% |
| Other | CN„512k | CN„523k | 8% |
| Total Compensation | CN„6.6m | CN„6.3m | 100% |
Talking in terms of the industry, salary represented approximately 81% of total compensation out of all the companies we analyzed, while other remuneration made up 19% of the pie. China Green (Holdings) is paying a higher share of its remuneration through a salary in comparison to the overall industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
China Green (Holdings) Limited's Growth
China Green (Holdings) Limited's earnings per share (EPS) grew 20% per year over the last three years. Its revenue is down 4.6% over the previous year.
This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has China Green (Holdings) Limited Been A Good Investment?
Given the total shareholder loss of 82% over three years, many shareholders in China Green (Holdings) Limited are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be lessto generous with CEO compensation.
To Conclude...
As we noted earlier, China Green (Holdings) pays its CEO higher than the norm for similar-sized companies belonging to the same industry. However, we must not forget that the EPS growth has been very strong, but shareholder returns â over the same period â have been disappointing. Although we don't think the CEO pay is too high, considering negative investor returns, it is more generous than modest.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for China Green (Holdings) that investors should think about before committing capital to this stock.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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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About SEHK:904
China Green (Holdings)
China Green (Holdings) Limited, an investment holding company, operates as a green food provider primarily in the Peopleâs Republic of China.
Good value with weak fundamentals.
