Increases to CEO Compensation Might Be Put On Hold For Now at Pico Far East Holdings Limited (HKG:752)

Key Insights

• Pico Far East Holdings' Annual General Meeting to take place on 18th of March
• Total pay for CEO Lawrence Chia includes HK$8.02m salary
• Total compensation is 417% above industry average
• Pico Far East Holdings' EPS grew by 65% over the past three years while total shareholder return over the past three years was 57%

CEO Lawrence Chia has done a decent job of delivering relatively good performance at Pico Far East Holdings Limited (HKG:752) recently. As shareholders go into the upcoming AGM on 18th of March, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.

See our latest analysis for Pico Far East Holdings

Comparing Pico Far East Holdings Limited's CEO Compensation With The Industry

According to our data, Pico Far East Holdings Limited has a market capitalization of HK$2.2b, and paid its CEO total annual compensation worth HK$15m over the year to October 2023. That is, the compensation was roughly the same as last year. In particular, the salary of HK$8.02m, makes up a fairly large portion of the total compensation being paid to the CEO.

In comparison with other companies in the Hong Kong Media industry with market capitalizations ranging from HK$782m to HK$3.1b, the reported median CEO total compensation was HK$2.9m. Hence, we can conclude that Lawrence Chia is remunerated higher than the industry median. Moreover, Lawrence Chia also holds HK$3.2m worth of Pico Far East Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	HK$8.0m	HK$7.3m	53%
Other	HK$7.0m	HK$7.4m	47%
Total Compensation	HK$15m	HK$15m	100%

Talking in terms of the industry, salary represented approximately 86% of total compensation out of all the companies we analyzed, while other remuneration made up 14% of the pie. Pico Far East Holdings pays a modest slice of remuneration through salary, as compared to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Pico Far East Holdings Limited's Growth Numbers

Pico Far East Holdings Limited has seen its earnings per share (EPS) increase by 65% a year over the past three years. Its revenue is up 17% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Pico Far East Holdings Limited Been A Good Investment?

We think that the total shareholder return of 57%, over three years, would leave most Pico Far East Holdings Limited shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

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.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 2 warning signs for Pico Far East Holdings you should be aware of, and 1 of them can't be ignored.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.