The CEO of CPM Group Limited (HKG:1932) is Philip Tsui, 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 CPM Group.
Check out our latest analysis for CPM Group
How Does Total Compensation For Philip Tsui Compare With Other Companies In The Industry?
According to our data, CPM Group Limited has a market capitalization of HK$460m, and paid its CEO total annual compensation worth HK$6.9m over the year to December 2019. That's a modest increase of 5.4% on the prior year. We note that the salary portion, which stands at HK$5.64m constitutes the majority of total compensation received by the CEO.
For comparison, other companies in the industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$1.4m. Accordingly, our analysis reveals that CPM Group Limited pays Philip Tsui north of the industry median.
| Component | 2019 | 2018 | Proportion (2019) |
| Salary | HK$5.6m | HK$5.6m | 82% |
| Other | HK$1.3m | HK$915k | 18% |
| Total Compensation | HK$6.9m | HK$6.6m | 100% |
Speaking on an industry level, nearly 58% of total compensation represents salary, while the remainder of 42% is other remuneration. CPM Group is paying a higher share of its remuneration through a salary in comparison to the overall 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 CPM Group Limited's Growth Numbers
Over the last three years, CPM Group Limited has shrunk its earnings per share by 37% per year. Revenue was pretty flat on last year.
Few shareholders would be pleased to read that EPS have declined. And the flat revenue hardly impresses. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has CPM Group Limited Been A Good Investment?
With a three year total loss of 11% for the shareholders, CPM Group Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.
To Conclude...
As previously discussed, Philip is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Disappointingly, share price gains over the last three years have failed to materialize. Arguably worse, we've been waiting for positive EPS growth for the last three years. Understandably, the company's shareholders might have some questions about the CEO's remuneration, given the disappointing performance.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. That's why we did our research, and identified 2 warning signs for CPM Group (of which 1 can't be ignored!) that you should know about in order to have a holistic understanding of the stock.
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Access Free AnalysisThis 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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