We Think Wharf Real Estate Investment Company Limited's (HKG:1997) CEO Compensation Package Needs To Be Put Under A Microscope

Key Insights

• Wharf Real Estate Investment's Annual General Meeting to take place on 15th of May
• CEO Stephen Ng's total compensation includes salary of HK$3.86m
• The overall pay is comparable to the industry average
• Over the past three years, Wharf Real Estate Investment's EPS fell by 41% and over the past three years, the total loss to shareholders 41%

We've discovered 3 warning signs about Wharf Real Estate Investment. View them for free.

Shareholders will probably not be too impressed with the underwhelming results at Wharf Real Estate Investment Company Limited (HKG:1997) recently. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 15th of May. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. From our analysis, we think CEO compensation may need a review in light of the recent performance.

See our latest analysis for Wharf Real Estate Investment

How Does Total Compensation For Stephen Ng Compare With Other Companies In The Industry?

Our data indicates that Wharf Real Estate Investment Company Limited has a market capitalization of HK$58b, and total annual CEO compensation was reported as HK$8.4m for the year to December 2024. This means that the compensation hasn't changed much from last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at HK$3.9m.

For comparison, other companies in the Hong Kong Real Estate industry with market capitalizations ranging between HK$31b and HK$93b had a median total CEO compensation of HK$12m. So it looks like Wharf Real Estate Investment compensates Stephen Ng in line with the median for the industry. Furthermore, Stephen Ng directly owns HK$27m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	HK$3.9m	HK$3.7m	46%
Other	HK$4.5m	HK$4.5m	54%
Total Compensation	HK$8.4m	HK$8.2m	100%

Talking in terms of the industry, salary represented approximately 82% of total compensation out of all the companies we analyzed, while other remuneration made up 18% of the pie. It's interesting to note that Wharf Real Estate Investment allocates a smaller portion of compensation to salary in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Wharf Real Estate Investment Company Limited's Growth Numbers

Wharf Real Estate Investment Company Limited has reduced its earnings per share by 41% a year over the last three years. In the last year, its revenue is down 3.0%.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Wharf Real Estate Investment Company Limited Been A Good Investment?

The return of -41% over three years would not have pleased Wharf Real Estate Investment Company Limited shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

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, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 3 warning signs for Wharf Real Estate Investment that investors should think about before committing capital to this stock.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.