The Compensation For Mei Ah Entertainment Group Limited's (HKG:391) CEO Looks Deserved And Here's Why

Key Insights

• Mei Ah Entertainment Group will host its Annual General Meeting on 22nd of September
• Salary of HK$987.0k is part of CEO Tang Yuk Li's total remuneration
• The total compensation is similar to the average for the industry
• Mei Ah Entertainment Group's total shareholder return over the past three years was 55% while its EPS grew by 25% over the past three years

It would be hard to discount the role that CEO Tang Yuk Li has played in delivering the impressive results at Mei Ah Entertainment Group Limited (HKG:391) recently. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 22nd of September. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and cast their votes on resolutions such as executive remuneration and other matters. We think the CEO has done a pretty decent job and we discuss why the CEO compensation is appropriate.

See our latest analysis for Mei Ah Entertainment Group

How Does Total Compensation For Tang Yuk Li Compare With Other Companies In The Industry?

At the time of writing, our data shows that Mei Ah Entertainment Group Limited has a market capitalization of HK$966m, and reported total annual CEO compensation of HK$1.0m for the year to March 2023. That's a modest increase of 3.6% on the prior year. In particular, the salary of HK$987.0k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Hong Kong Entertainment industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$1.2m. So it looks like Mei Ah Entertainment Group compensates Tang Yuk Li in line with the median for the industry.

Component	2023	2022	Proportion (2023)
Salary	HK$987k	HK$952k	98%
Other	HK$18k	HK$18k	2%
Total Compensation	HK$1.0m	HK$970k	100%

On an industry level, around 90% of total compensation represents salary and 10% is other remuneration. Mei Ah Entertainment Group has gone down a largely traditional route, paying Tang Yuk Li a high salary, giving it preference over non-salary benefits. 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.

Mei Ah Entertainment Group Limited's Growth

Mei Ah Entertainment Group Limited's earnings per share (EPS) grew 25% per year over the last three years. It saw its revenue drop 3.4% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Mei Ah Entertainment Group Limited Been A Good Investment?

We think that the total shareholder return of 55%, over three years, would leave most Mei Ah Entertainment Group Limited shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Mei Ah Entertainment Group pays its CEO a majority of compensation through a salary. Seeing that company performance has been quite good recently, some shareholders may feel that CEO compensation may not be the biggest focus in the upcoming AGM. In saying that, some shareholders may feel that the more important issues to be addressed may be how the management plans to steer the company towards sustainable profitability in the future.

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

Important note: Mei Ah Entertainment Group 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.