Wing Tai Properties Limited's (HKG:369) CEO Compensation Is Looking A Bit Stretched At The Moment
Key Insights
- Wing Tai Properties' Annual General Meeting to take place on 29th of May
- CEO Edward Cheng's total compensation includes salary of HK$15.3m
- Total compensation is 733% above industry average
- Over the past three years, Wing Tai Properties' EPS fell by 97% and over the past three years, the total loss to shareholders 54%
The underwhelming share price performance of Wing Tai Properties Limited (HKG:369) in the past three years would have disappointed many shareholders. In addition, the company's per-share earnings growth is not looking good, despite growing revenues. In light of this performance, shareholders will have a chance to question the board in the upcoming AGM on 29th of May, where they can impact on future company performance by voting on resolutions, including executive compensation. Here's our take on why we think shareholders might be hesitant about approving a raise at the moment.
Check out our latest analysis for Wing Tai Properties
Comparing Wing Tai Properties Limited's CEO Compensation With The Industry
At the time of writing, our data shows that Wing Tai Properties Limited has a market capitalization of HK$2.1b, and reported total annual CEO compensation of HK$24m for the year to December 2024. That is, the compensation was roughly the same as last year. Notably, the salary which is HK$15.3m, represents most of the total compensation being paid.
On comparing similar companies from the Hong Kong Real Estate industry with market caps ranging from HK$783m to HK$3.1b, we found that the median CEO total compensation was HK$2.9m. Accordingly, our analysis reveals that Wing Tai Properties Limited pays Edward Cheng north of the industry median. Furthermore, Edward Cheng directly owns HK$19m worth of shares in the company, implying that they are deeply invested in the company's success.
| Component | 2024 | 2023 | Proportion (2024) |
| Salary | HK$15m | HK$15m | 63% |
| Other | HK$9.1m | HK$9.1m | 37% |
| Total Compensation | HK$24m | HK$24m | 100% |
On an industry level, around 82% of total compensation represents salary and 18% is other remuneration. In Wing Tai Properties' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
Wing Tai Properties Limited's Growth
Over the last three years, Wing Tai Properties Limited has shrunk its earnings per share by 97% per year. It achieved revenue growth of 17% over the last year.
The reduction in EPS, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. 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 Wing Tai Properties Limited Been A Good Investment?
With a total shareholder return of -54% over three years, Wing Tai Properties Limited shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
To Conclude...
The company's earnings haven't grown and possibly because of that, the stock has performed poorly, resulting in a loss for the company's shareholders. In the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan is in line with their expectations.
CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 1 warning sign for Wing Tai Properties that investors should think about before committing capital to this stock.
Important note: Wing Tai Properties 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.