Here's Why Shareholders May Consider Paying Jilin Province Huinan Changlong Bio-pharmacy Company Limited's (HKG:8049) CEO A Little More

Key Insights

• Jilin Province Huinan Changlong Bio-pharmacy to hold its Annual General Meeting on 28th of May
• CEO Hong Zhang's total compensation includes salary of CN¥273.0k
• The total compensation is 85% less than the average for the industry
• Jilin Province Huinan Changlong Bio-pharmacy's EPS grew by 5.4% over the past three years while total shareholder return over the past three years was 90%

Shareholders will be pleased by the robust performance of Jilin Province Huinan Changlong Bio-pharmacy Company Limited (HKG:8049) recently and this will be kept in mind in the upcoming AGM on 28th of May. This would also be a chance for them to hear the board review the financial results, discuss future company strategy to further improve the business and vote on any resolutions such as executive remuneration. In our analysis below, we discuss why we think the CEO compensation looks acceptable and the case for a raise.

View our latest analysis for Jilin Province Huinan Changlong Bio-pharmacy

How Does Total Compensation For Hong Zhang Compare With Other Companies In The Industry?

Our data indicates that Jilin Province Huinan Changlong Bio-pharmacy Company Limited has a market capitalization of HK$835m, and total annual CEO compensation was reported as CN¥623k for the year to December 2023. Notably, that's an increase of 16% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at CN¥273k.

On comparing similar-sized companies in the Hong Kong Pharmaceuticals industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was CN¥4.1m. That is to say, Hong Zhang is paid under the industry median. Furthermore, Hong Zhang directly owns HK$152m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	CN¥273k	CN¥239k	44%
Other	CN¥350k	CN¥300k	56%
Total Compensation	CN¥623k	CN¥539k	100%

Talking in terms of the industry, salary represented approximately 63% of total compensation out of all the companies we analyzed, while other remuneration made up 37% of the pie. It's interesting to note that Jilin Province Huinan Changlong Bio-pharmacy allocates a smaller portion of compensation to salary in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

A Look at Jilin Province Huinan Changlong Bio-pharmacy Company Limited's Growth Numbers

Jilin Province Huinan Changlong Bio-pharmacy Company Limited's earnings per share (EPS) grew 5.4% per year over the last three years. Revenue was pretty flat on last year.

We would prefer it if there was revenue growth, but it is good to see a modest EPS growth at least. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Jilin Province Huinan Changlong Bio-pharmacy Company Limited Been A Good Investment?

We think that the total shareholder return of 90%, over three years, would leave most Jilin Province Huinan Changlong Bio-pharmacy Company Limited shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

While the company seems to be headed in the right direction performance-wise, there's always room for improvement. If it continues on the same road, shareholders might feel even more confident about their investment, and have little to no objections concerning CEO pay. Rather, investors would more likely want to engage on discussions related to key strategic initiatives and future growth opportunities for the company and set their longer-term expectations.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 1 warning sign for Jilin Province Huinan Changlong Bio-pharmacy that investors should be aware of in a dynamic business environment.

Switching gears from Jilin Province Huinan Changlong Bio-pharmacy, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.