Irene Chau is the CEO of OOH Holdings Limited (HKG:8091), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
View our latest analysis for OOH Holdings
Comparing OOH Holdings Limited's CEO Compensation With the industry
Our data indicates that OOH Holdings Limited has a market capitalization of HK$19m, and total annual CEO compensation was reported as HK$2.6m for the year to March 2020. That's a notable increase of 19% on last year. Notably, the salary of HK$2.6m is the entirety of the CEO compensation.
For comparison, other companies in the industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$2.6m. This suggests that OOH Holdings remunerates its CEO largely in line with the industry average. What's more, Irene Chau holds HK$7.5m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | HK$2.6m | HK$2.2m | 100% |
| Other | - | - | - |
| Total Compensation | HK$2.6m | HK$2.2m | 100% |
On an industry level, around 84% of total compensation represents salary and 16% is other remuneration. Speaking on a company level, OOH Holdings prefers to tread along a traditional path, disbursing all compensation through a salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
OOH Holdings Limited's Growth
OOH Holdings Limited has reduced its earnings per share by 117% a year over the last three years. In the last year, its revenue is down 24%.
Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has OOH Holdings Limited Been A Good Investment?
With a three year total loss of 80% for the shareholders, OOH Holdings Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
OOH Holdings pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. As we touched on above, OOH Holdings Limited is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Meanwhile, EPS growth and shareholder returns have been in the red for the last three years. Considering overall performance, shareholders will likely hold off support for a raise until results improve.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 3 warning signs for OOH Holdings (2 are significant!) that you should be aware of before investing here.
Important note: OOH 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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About SEHK:8091
OOH Holdings
An investment holding company, provides out-of-home advertising space and services in Hong Kong.
Flawless balance sheet and good value.
