Shun-Chuen Lam is the CEO of Oriental Press Group Limited (HKG:18), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
How Does Total Compensation For Shun-Chuen Lam Compare With Other Companies In The Industry?
At the time of writing, our data shows that Oriental Press Group Limited has a market capitalization of HK$959m, and reported total annual CEO compensation of HK$2.7m for the year to March 2020. That is, the compensation was roughly the same as last year. Notably, the salary of HK$2.7m is the entirety of the CEO compensation.
For comparison, other companies in the industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$2.7m. From this we gather that Shun-Chuen Lam is paid around the median for CEOs in the industry.
Talking in terms of the industry, salary represented approximately 77% of total compensation out of all the companies we analyzed, while other remuneration made up 23% of the pie. At the company level, Oriental Press Group pays Shun-Chuen Lam solely through a salary, preferring to go down a conventional route. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at Oriental Press Group Limited's Growth Numbers
Over the last three years, Oriental Press Group Limited has shrunk its earnings per share by 48% per year. In the last year, its revenue is down 8.5%.
The decline in EPS is a bit concerning. 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 Oriental Press Group Limited Been A Good Investment?
Given the total shareholder loss of 44% over three years, many shareholders in Oriental Press Group Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
Oriental Press Group pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. As previously discussed, Shun-Chuen is compensated close to the median for companies of its size, and which belong to the same industry. Meanwhile, EPS growth and shareholder returns have been in the red for the last three years. It's tough to call out the compensation as inappropriate, but shareholders might not favor a raise before company performance improves.
If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Oriental Press Group.
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