Here's Why It's Unlikely That Landsea Green Management Limited's (HKG:106) CEO Will See A Pay Rise This Year

Key Insights

• Landsea Green Management's Annual General Meeting to take place on 14th of June
• CEO Zheng Huang's total compensation includes salary of CN¥1.02m
• The total compensation is 56% higher than the average for the industry
• Landsea Green Management's EPS declined by 47% over the past three years while total shareholder loss over the past three years was 88%

Landsea Green Management Limited (HKG:106) has not performed well recently and CEO Zheng Huang will probably need to up their game. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 14th of June. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Check out our latest analysis for Landsea Green Management

How Does Total Compensation For Zheng Huang Compare With Other Companies In The Industry?

According to our data, Landsea Green Management Limited has a market capitalization of HK$279m, and paid its CEO total annual compensation worth CN¥2.6m over the year to December 2023. We note that's a decrease of 16% compared to last year. While we always look at total compensation first, our analysis shows that the salary component is less, at CN¥1.0m.

On comparing similar-sized companies in the Hong Kong Real Estate industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was CN¥1.7m. This suggests that Zheng Huang is paid more than the median for the industry.

Component	2023	2022	Proportion (2023)
Salary	CN¥1.0m	CN¥1.6m	39%
Other	CN¥1.6m	CN¥1.5m	61%
Total Compensation	CN¥2.6m	CN¥3.2m	100%

Talking in terms of the industry, salary represented approximately 77% of total compensation out of all the companies we analyzed, while other remuneration made up 23% of the pie. It's interesting to note that Landsea Green Management 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 Landsea Green Management Limited's Growth Numbers

Over the last three years, Landsea Green Management Limited has shrunk its earnings per share by 47% per year. Its revenue is down 36% over the previous year.

Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Landsea Green Management Limited Been A Good Investment?

With a total shareholder return of -88% over three years, Landsea Green Management Limited shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 4 warning signs for Landsea Green Management (3 shouldn't be ignored!) that you should be aware of before investing here.

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. 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.