How Much Is Nan Hai Corporation Limited (HKG:680) CEO Getting Paid?

Rong Liu became the CEO of Nan Hai Corporation Limited (HKG:680) in 2018, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also assess whether Nan Hai pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

View our latest analysis for Nan Hai

Comparing Nan Hai Corporation Limited's CEO Compensation With the industry

At the time of writing, our data shows that Nan Hai Corporation Limited has a market capitalization of HK$3.2b, and reported total annual CEO compensation of HK$738k for the year to December 2019. That's a notable decrease of 12% on last year. In particular, the salary of HK$723.0k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the same industry with market capitalizations ranging between HK$1.6b and HK$6.2b had a median total CEO compensation of HK$1.9m. Accordingly, Nan Hai pays its CEO under the industry median.

Talking in terms of the industry, salary represented approximately 91% of total compensation out of all the companies we analyzed, while other remuneration made up 9.3% of the pie. Nan Hai is focused on going down a more traditional approach and is paying a higher portion of compensation through salary, as compared to non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Nan Hai Corporation Limited's Growth

Over the last three years, Nan Hai Corporation Limited has shrunk its earnings per share by 105% per year. Its revenue is down 29% over the previous year.

Few shareholders would be pleased to read that EPS have declined. And the impression is worse when you consider revenue is down year-on-year. 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 Nan Hai Corporation Limited Been A Good Investment?

With a three year total loss of 78% for the shareholders, Nan Hai Corporation Limited would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Nan Hai pays its CEO a majority of compensation through a salary. As previously discussed, Rong 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. It's tough to say that Rong is earning a very high compensation, but shareholders will likely want to see healthier investor returns before agreeing that a raise is in order.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 2 warning signs for Nan Hai that you should be aware of before investing.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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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