Here's Why Shareholders May Want To Be Cautious With Increasing Golden Throat Holdings Group Company Limited's (HKG:6896) CEO Pay Packet

Key Insights

• Golden Throat Holdings Group's Annual General Meeting to take place on 5th of June
• Salary of CN¥3.34m is part of CEO Yong Zeng's total remuneration
• The overall pay is 469% above the industry average
• Golden Throat Holdings Group's total shareholder return over the past three years was 175% while its EPS grew by 18% over the past three years

CEO Yong Zeng has done a decent job of delivering relatively good performance at Golden Throat Holdings Group Company Limited (HKG:6896) recently. In light of this performance, CEO compensation will probably not be the main focus for shareholders as they go into the AGM on 5th of June. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

See our latest analysis for Golden Throat Holdings Group

How Does Total Compensation For Yong Zeng Compare With Other Companies In The Industry?

At the time of writing, our data shows that Golden Throat Holdings Group Company Limited has a market capitalization of HK$2.7b, and reported total annual CEO compensation of CN¥6.3m for the year to December 2023. Notably, that's an increase of 13% over the year before. We note that the salary of CN¥3.34m makes up a sizeable portion of the total compensation received by the CEO.

In comparison with other companies in the Hong Kong Personal Products industry with market capitalizations ranging from HK$1.6b to HK$6.2b, the reported median CEO total compensation was CN¥1.1m. This suggests that Yong Zeng is paid more than the median for the industry. Furthermore, Yong Zeng directly owns HK$1.7b worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	CN¥3.3m	CN¥3.3m	53%
Other	CN¥2.9m	CN¥2.2m	47%
Total Compensation	CN¥6.3m	CN¥5.5m	100%

Speaking on an industry level, nearly 68% of total compensation represents salary, while the remainder of 32% is other remuneration. Golden Throat Holdings Group pays a modest slice of remuneration through salary, as compared to the broader industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at Golden Throat Holdings Group Company Limited's Growth Numbers

Golden Throat Holdings Group Company Limited's earnings per share (EPS) grew 18% per year over the last three years. It saw its revenue drop 3.1% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. 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 Golden Throat Holdings Group Company Limited Been A Good Investment?

Most shareholders would probably be pleased with Golden Throat Holdings Group Company Limited for providing a total return of 175% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. Still, not all shareholders might be in favor of a pay raise to the CEO, seeing that they are already being paid higher than the industry.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 1 warning sign for Golden Throat Holdings Group that investors should be aware of in a dynamic business environment.

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. 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.