Should Shareholders Have Second Thoughts About A Pay Rise For Coastal Greenland Limited's (HKG:1124) CEO This Year?

Key Insights

• Coastal Greenland will host its Annual General Meeting on 10th of September
• Total pay for CEO Ming Jiang includes HK$1.30m salary
• Total compensation is 36% below industry average
• Coastal Greenland's three-year loss to shareholders was 73% while its EPS was down 33% over the past three years

The underwhelming performance at Coastal Greenland Limited (HKG:1124) recently has probably not pleased shareholders. The next AGM coming up on 10th of September will be a chance for shareholders to have their concerns addressed by the board, challenge management on company strategy and vote on resolutions such as executive remuneration, which may help change the company's future prospects. We think most shareholders will probably pass the CEO compensation, based on what we gathered.

See our latest analysis for Coastal Greenland

Comparing Coastal Greenland Limited's CEO Compensation With The Industry

Our data indicates that Coastal Greenland Limited has a market capitalization of HK$69m, and total annual CEO compensation was reported as HK$1.3m for the year to March 2024. That's a notable decrease of 29% on last year. It is worth noting that the CEO compensation consists entirely of the salary, worth HK$1.3m.

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 HK$2.0m. In other words, Coastal Greenland pays its CEO lower than the industry median.

Component	2024	2023	Proportion (2024)
Salary	HK$1.3m	HK$1.8m	100%
Other	-	-	-
Total Compensation	HK$1.3m	HK$1.8m	100%

On an industry level, roughly 76% of total compensation represents salary and 24% is other remuneration. At the company level, Coastal Greenland pays Ming Jiang solely through a salary, preferring to go down a conventional route. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Coastal Greenland Limited's Growth

Over the last three years, Coastal Greenland Limited has shrunk its earnings per share by 33% per year. In the last year, its revenue is down 98%.

The decline in EPS is a bit concerning. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Coastal Greenland Limited Been A Good Investment?

Few Coastal Greenland Limited shareholders would feel satisfied with the return of -73% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Coastal Greenland pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 5 warning signs for Coastal Greenland you should be aware of, and 4 of them are significant.

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.