Increases to Gushengtang Holdings Limited's (HKG:2273) CEO Compensation Might Cool off for now

Key Insights

• Gushengtang Holdings' Annual General Meeting to take place on 20th of June
• Salary of CN¥3.01m is part of CEO Zhiliang Tu's total remuneration
• Total compensation is 697% above industry average
• Over the past three years, Gushengtang Holdings' EPS grew by 104% and over the past three years, the total shareholder return was 11%

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CEO Zhiliang Tu has done a decent job of delivering relatively good performance at Gushengtang Holdings Limited (HKG:2273) recently. As shareholders go into the upcoming AGM on 20th of June, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for Gushengtang Holdings

How Does Total Compensation For Zhiliang Tu Compare With Other Companies In The Industry?

According to our data, Gushengtang Holdings Limited has a market capitalization of HK$8.4b, and paid its CEO total annual compensation worth CN¥18m over the year to December 2024. That's a notable increase of 13% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at CN¥3.0m.

On comparing similar companies from the Hong Kong Healthcare industry with market caps ranging from HK$3.1b to HK$13b, we found that the median CEO total compensation was CN¥2.3m. This suggests that Zhiliang Tu is paid more than the median for the industry. Moreover, Zhiliang Tu also holds HK$781m worth of Gushengtang Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, roughly 78% of total compensation represents salary and 22% is other remuneration. It's interesting to note that Gushengtang Holdings allocates a smaller portion of compensation to salary 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.

Gushengtang Holdings Limited's Growth

Over the past three years, Gushengtang Holdings Limited has seen its earnings per share (EPS) grow by 104% per year. In the last year, its revenue is up 30%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Gushengtang Holdings Limited Been A Good Investment?

Gushengtang Holdings Limited has generated a total shareholder return of 11% over three years, so most shareholders would be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

To Conclude...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

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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.