Shareholders Will Probably Hold Off On Increasing Multifield International Holdings Limited's (HKG:898) CEO Compensation For The Time Being

Key Insights

• Multifield International Holdings to hold its Annual General Meeting on 28th of May
• CEO Michael Lau's total compensation includes salary of HK$2.25m
• The total compensation is 38% higher than the average for the industry
• Multifield International Holdings' total shareholder return over the past three years was 6.3% while its EPS was down 18% over the past three years

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Despite positive share price growth of 6.3% for Multifield International Holdings Limited (HKG:898) over the last few years, earnings growth has been disappointing, which suggests something is amiss. These concerns will be at the front of shareholders' minds as they go into the AGM coming up on 28th of May. One way that shareholders can influence managerial decisions is through voting on CEO and executive remuneration packages, which studies show could impact company performance. From the data that we gathered, we think that shareholders should hold off on a raise on CEO compensation until performance starts to show some improvement.

Check out our latest analysis for Multifield International Holdings

How Does Total Compensation For Michael Lau Compare With Other Companies In The Industry?

According to our data, Multifield International Holdings Limited has a market capitalization of HK$803m, and paid its CEO total annual compensation worth HK$2.3m over the year to December 2024. This was the same amount the CEO received in the prior year. It is worth noting that the CEO compensation consists entirely of the salary, worth HK$2.3m.

In comparison with other companies in the Hong Kong Real Estate industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$1.6m. Hence, we can conclude that Michael Lau is remunerated higher than the industry median.

On an industry level, around 82% of total compensation represents salary and 18% is other remuneration. On a company level, Multifield International Holdings prefers to reward its CEO through a salary, opting not to pay Michael Lau through non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Multifield International Holdings Limited's Growth Numbers

Over the last three years, Multifield International Holdings Limited has shrunk its earnings per share by 18% per year. In the last year, its revenue changed by just 0.8%.

The decline in EPS is a bit concerning. And the flat revenue is seriously uninspiring. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Multifield International Holdings Limited Been A Good Investment?

With a total shareholder return of 6.3% over three years, Multifield International Holdings Limited has done okay by shareholders, but there's always room for improvement. In light of that, investors might probably want to see an improvement on their returns before they feel generous about increasing the CEO remuneration.

To Conclude...

Multifield International Holdings rewards its CEO solely through a salary, ignoring non-salary benefits completely. Despite the positive returns on shareholders' investments, the fact that earnings have failed to grow makes us skeptical about whether these returns will continue. Shareholders should make the most of the coming opportunity to question the board on key concerns they may have and revisit their investment thesis with regards to the company.

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 3 warning signs for Multifield International Holdings you should be aware of, and 1 of them is significant.

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.