Kerry Properties Limited's (HKG:683) CEO Might Not Expect Shareholders To Be So Generous This Year

Key Insights

• Kerry Properties to hold its Annual General Meeting on 20th of May
• CEO Khoon Hua Kuok's total compensation includes salary of HK$6.00m
• Total compensation is similar to the industry average
• Kerry Properties' EPS declined by 16% over the past three years while total shareholder loss over the past three years was 16%

Shareholders will probably not be too impressed with the underwhelming results at Kerry Properties Limited (HKG:683) recently. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 20th of May. 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. We present the case why we think CEO compensation is out of sync with company performance.

See our latest analysis for Kerry Properties

How Does Total Compensation For Khoon Hua Kuok Compare With Other Companies In The Industry?

Our data indicates that Kerry Properties Limited has a market capitalization of HK$23b, and total annual CEO compensation was reported as HK$14m for the year to December 2023. That's a notable decrease of 34% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at HK$6.0m.

For comparison, other companies in the Hong Kong Real Estate industry with market capitalizations ranging between HK$16b and HK$50b had a median total CEO compensation of HK$11m. So it looks like Kerry Properties compensates Khoon Hua Kuok in line with the median for the industry. Moreover, Khoon Hua Kuok also holds HK$96m worth of Kerry Properties stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	HK$6.0m	HK$6.0m	43%
Other	HK$7.9m	HK$15m	57%
Total Compensation	HK$14m	HK$21m	100%

On an industry level, roughly 77% of total compensation represents salary and 23% is other remuneration. In Kerry Properties' case, non-salary compensation represents a greater slice of total remuneration, 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 Kerry Properties Limited's Growth Numbers

Over the last three years, Kerry Properties Limited has shrunk its earnings per share by 16% per year. It saw its revenue drop 10% over the last year.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last 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 Kerry Properties Limited Been A Good Investment?

With a three year total loss of 16% for the shareholders, Kerry Properties Limited would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

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, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling Kerry Properties (free visualization of insider trades).

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.