Does CMMB Vision Holdings' (HKG:471) CEO Salary Compare Well With The Performance Of The Company?

Charles Wong has been the CEO of CMMB Vision Holdings Limited (HKG:471) since 2007, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for CMMB Vision Holdings.

See our latest analysis for CMMB Vision Holdings

How Does Total Compensation For Charles Wong Compare With Other Companies In The Industry?

At the time of writing, our data shows that CMMB Vision Holdings Limited has a market capitalization of HK$69m, and reported total annual CEO compensation of US$79k for the year to December 2019. Notably, that's an increase of 20% over the year before. Notably, the salary which is US$77.0k, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was US$335k. In other words, CMMB Vision Holdings pays its CEO lower than the industry median. What's more, Charles Wong holds HK$15m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Talking in terms of the industry, salary represented approximately 84% of total compensation out of all the companies we analyzed, while other remuneration made up 16% of the pie. Investors will find it interesting that CMMB Vision Holdings pays the bulk of its rewards through a traditional salary, instead of 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.

CMMB Vision Holdings Limited's Growth

Over the last three years, CMMB Vision Holdings Limited has shrunk its earnings per share by 39% per year. It saw its revenue drop 1.4% over the last year.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet 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 CMMB Vision Holdings Limited Been A Good Investment?

With a three year total loss of 96% for the shareholders, CMMB Vision Holdings Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.

In Summary...

CMMB Vision Holdings pays its CEO a majority of compensation through a salary. As previously discussed, Charles is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. While we are quite underwhelmed with EPS growth, the shareholder returns over the past three years have also failed to impress us. We can't say the CEO compensation is high, but shareholders will be cold to a bump at this stage, considering negative investor returns.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 5 warning signs for CMMB Vision Holdings (of which 2 are a bit unpleasant!) that you should know about in order to have a holistic understanding of the stock.

Important note: CMMB Vision 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. 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.
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