CIFI Ever Sunshine Services Group Limited's (HKG:1995) CEO Might Not Expect Shareholders To Be So Generous This Year

Key Insights

• CIFI Ever Sunshine Services Group to hold its Annual General Meeting on 20th of November
• Total pay for CEO Hongbin Zhou includes CN¥4.37m salary
• The overall pay is 93% above the industry average
• CIFI Ever Sunshine Services Group's EPS declined by 0.2% over the past three years while total shareholder loss over the past three years was 90%

Shareholders will probably not be too impressed with the underwhelming results at CIFI Ever Sunshine Services Group Limited (HKG:1995) recently. At the upcoming AGM on 20th of November, shareholders can hear from the board including their plans for turning around performance. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. The data we present below explains why we think CEO compensation is not consistent with recent performance.

Check out our latest analysis for CIFI Ever Sunshine Services Group

How Does Total Compensation For Hongbin Zhou Compare With Other Companies In The Industry?

At the time of writing, our data shows that CIFI Ever Sunshine Services Group Limited has a market capitalization of HK$2.3b, and reported total annual CEO compensation of CN¥5.2m for the year to December 2022. That's mostly flat as compared to the prior year's compensation. In particular, the salary of CN¥4.37m, makes up a huge portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the Hong Kong Real Estate industry with market capitalizations between HK$781m and HK$3.1b, we discovered that the median CEO total compensation of that group was CN¥2.7m. Accordingly, our analysis reveals that CIFI Ever Sunshine Services Group Limited pays Hongbin Zhou north of the industry median. What's more, Hongbin Zhou holds HK$52m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2022	2021	Proportion (2022)
Salary	CN¥4.4m	CN¥4.3m	85%
Other	CN¥787k	CN¥782k	15%
Total Compensation	CN¥5.2m	CN¥5.1m	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. Although there is a difference in how total compensation is set, CIFI Ever Sunshine Services Group more or less reflects the market in terms of setting the salary. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at CIFI Ever Sunshine Services Group Limited's Growth Numbers

CIFI Ever Sunshine Services Group Limited saw earnings per share stay pretty flat over the last three years. Its revenue is up 8.4% over the last year.

The lack of EPS growth is certainly uninspiring. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has CIFI Ever Sunshine Services Group Limited Been A Good Investment?

Few CIFI Ever Sunshine Services Group Limited shareholders would feel satisfied with the return of -90% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 4 warning signs for CIFI Ever Sunshine Services Group you should be aware of, and 2 of them are concerning.

Important note: CIFI Ever Sunshine Services Group 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. 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.