Does China Metal Resources Utilization's (HKG:1636) CEO Salary Compare Well With Industry Peers?

The CEO of China Metal Resources Utilization Limited (HKG:1636) is Jianqiu Yu, and this article examines the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for China Metal Resources Utilization.

Check out our latest analysis for China Metal Resources Utilization

Comparing China Metal Resources Utilization Limited's CEO Compensation With the industry

At the time of writing, our data shows that China Metal Resources Utilization Limited has a market capitalization of HK$447m, and reported total annual CEO compensation of CN¥2.8m for the year to December 2019. That's just a smallish increase of 4.3% on last year. In particular, the salary of CN¥2.81m, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was CN¥905k. Accordingly, our analysis reveals that China Metal Resources Utilization Limited pays Jianqiu Yu north of the industry median. Moreover, Jianqiu Yu also holds HK$89m worth of China Metal Resources Utilization stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Talking in terms of the industry, salary represented approximately 86% of total compensation out of all the companies we analyzed, while other remuneration made up 14% of the pie. Investors will find it interesting that China Metal Resources Utilization pays the bulk of its rewards through a traditional salary, instead of non-salary benefits. 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.

China Metal Resources Utilization Limited's Growth

China Metal Resources Utilization Limited has reduced its earnings per share by 83% a year over the last three years. In the last year, its revenue changed by just 0.8%.

The decline in EPS is a bit concerning. And the flat revenue is seriously uninspiring. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has China Metal Resources Utilization Limited Been A Good Investment?

Since shareholders would have lost about 95% over three years, some China Metal Resources Utilization Limited investors would surely be feeling negative emotions. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

Jianqiu receives almost all of their compensation through a salary. As we noted earlier, China Metal Resources Utilization pays its CEO higher than the norm for similar-sized companies belonging to the same industry. Unfortunately, this doesn't look great when you see shareholder returns have been negative over the last three years. Add to that declining EPS growth, and you have the perfect recipe for shareholder irritation. Overall, with such poor performance, shareholder's would probably have questions if the company decided to give the CEO a raise.

CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 3 warning signs for China Metal Resources Utilization that investors should look into moving forward.

Switching gears from China Metal Resources Utilization, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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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