Shareholders May Be Wary Of Increasing Asia Cement (China) Holdings Corporation's (HKG:743) CEO Compensation Package

Key Insights

• Asia Cement (China) Holdings will host its Annual General Meeting on 26th of May
• Total pay for CEO Chen-Kuen Chang includes CN¥1.17m salary
• The total compensation is 43% higher than the average for the industry
• Asia Cement (China) Holdings' EPS declined by 117% over the past three years while total shareholder loss over the past three years was 41%

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Shareholders will probably not be too impressed with the underwhelming results at Asia Cement (China) Holdings Corporation (HKG:743) recently. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 26th of May. 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. The data we present below explains why we think CEO compensation is not consistent with recent performance.

See our latest analysis for Asia Cement (China) Holdings

Comparing Asia Cement (China) Holdings Corporation's CEO Compensation With The Industry

According to our data, Asia Cement (China) Holdings Corporation has a market capitalization of HK$3.7b, and paid its CEO total annual compensation worth CN¥1.4m over the year to December 2024. That is, the compensation was roughly the same as last year. In particular, the salary of CN¥1.17m, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Hong Kong Basic Materials industry with market capitalizations ranging from HK$1.6b to HK$6.3b, the reported median CEO total compensation was CN¥978k. This suggests that Chen-Kuen Chang is paid more than the median for the industry. Furthermore, Chen-Kuen Chang directly owns HK$1.7m worth of shares in the company, implying that they are deeply invested in the company's success.

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. Although there is a difference in how total compensation is set, Asia Cement (China) Holdings more or less reflects the market in terms of setting the salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Asia Cement (China) Holdings Corporation's Growth

Over the last three years, Asia Cement (China) Holdings Corporation has shrunk its earnings per share by 117% per year. In the last year, its revenue is down 14%.

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. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Asia Cement (China) Holdings Corporation Been A Good Investment?

The return of -41% over three years would not have pleased Asia Cement (China) Holdings Corporation shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid 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.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Asia Cement (China) Holdings that investors should think about before committing capital to this stock.

Important note: Asia Cement (China) Holdings is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.