Shareholders May Be Wary Of Increasing CNT Group Limited's (HKG:701) CEO Compensation Package

Key Insights

• CNT Group will host its Annual General Meeting on 5th of June
• CEO Chi Kwan Chong's total compensation includes salary of HK$1.38m
• The overall pay is 88% above the industry average
• Over the past three years, CNT Group's EPS fell by 14% and over the past three years, the total loss to shareholders 43%

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CNT Group Limited (HKG:701) has not performed well recently and CEO Chi Kwan Chong will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 5th of June. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Check out our latest analysis for CNT Group

How Does Total Compensation For Chi Kwan Chong Compare With Other Companies In The Industry?

According to our data, CNT Group Limited has a market capitalization of HK$402m, and paid its CEO total annual compensation worth HK$2.4m over the year to December 2024. That's a slight decrease of 5.0% on the prior year. Notably, the salary which is HK$1.38m, represents a considerable chunk of the total compensation being paid.

In comparison with other companies in the Hong Kong Chemicals industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$1.3m. This suggests that Chi Kwan Chong is paid more than the median for the industry.

Talking in terms of the industry, salary represented approximately 83% of total compensation out of all the companies we analyzed, while other remuneration made up 17% of the pie. CNT Group pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

CNT Group Limited's Growth

Over the last three years, CNT Group Limited has shrunk its earnings per share by 14% per year. In the last year, its revenue is down 30%.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. 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 CNT Group Limited Been A Good Investment?

Few CNT Group Limited shareholders would feel satisfied with the return of -43% over three years. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

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 CNT Group (of which 1 doesn't sit too well with us!) that you should know about in order to have a holistic understanding of the stock.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.