Shareholders Will Probably Hold Off On Increasing XD Inc.'s (HKG:2400) CEO Compensation For The Time Being

Key Insights

• XD's Annual General Meeting to take place on 29th of May
• CEO Yimeng Huang's total compensation includes salary of CN¥373.0k
• The overall pay is 73% above the industry average
• XD's EPS grew by 117% over the past three years while total shareholder return over the past three years was 100%

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Under the guidance of CEO Yimeng Huang, XD Inc. (HKG:2400) has performed reasonably well recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 29th of May. However, some shareholders may still want to keep CEO compensation within reason.

See our latest analysis for XD

Comparing XD Inc.'s CEO Compensation With The Industry

At the time of writing, our data shows that XD Inc. has a market capitalization of HK$19b, and reported total annual CEO compensation of CN¥3.7m for the year to December 2024. That's a notable decrease of 39% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at CN¥373k.

For comparison, other companies in the Hong Kong Entertainment industry with market capitalizations ranging between HK$7.8b and HK$25b had a median total CEO compensation of CN¥2.1m. Accordingly, our analysis reveals that XD Inc. pays Yimeng Huang north of the industry median. What's more, Yimeng Huang holds HK$6.3b worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2024	2023	Proportion (2024)
Salary	CN¥373k	CN¥1.3m	10%
Other	CN¥3.3m	CN¥4.7m	90%
Total Compensation	CN¥3.7m	CN¥6.1m	100%

Talking in terms of the industry, salary represented approximately 85% of total compensation out of all the companies we analyzed, while other remuneration made up 15% of the pie. In XD's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at XD Inc.'s Growth Numbers

XD Inc.'s earnings per share (EPS) grew 117% per year over the last three years. In the last year, its revenue is up 48%.

Shareholders would be glad to know that the company has improved itself over the last few years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has XD Inc. Been A Good Investment?

Most shareholders would probably be pleased with XD Inc. for providing a total return of 100% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Given that the company's overall performance has been reasonable, the CEO remuneration policy might not be shareholders' central point of focus in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

So you may want to check if insiders are buying XD shares with their own money (free access).

Switching gears from XD, 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. 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.