This article will reflect on the compensation paid to Kenny Gaw who has served as CEO of Pioneer Global Group Limited (HKG:224) since 1999. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.
View our latest analysis for Pioneer Global Group
Comparing Pioneer Global Group Limited's CEO Compensation With the industry
At the time of writing, our data shows that Pioneer Global Group Limited has a market capitalization of HK$1.2b, and reported total annual CEO compensation of HK$6.7m for the year to March 2020. This means that the compensation hasn't changed much from last year. We note that the salary portion, which stands at HK$4.43m constitutes the majority of total compensation received by the CEO.
On comparing similar companies from the same industry with market caps ranging from HK$775m to HK$3.1b, we found that the median CEO total compensation was HK$3.2m. Hence, we can conclude that Kenny Gaw is remunerated higher than the industry median. Furthermore, Kenny Gaw directly owns HK$122m worth of shares in the company, implying that they are deeply invested in the company's success.
| Component | 2020 | 2019 | Proportion (2020) |
| Salary | HK$4.4m | HK$4.4m | 66% |
| Other | HK$2.3m | HK$2.3m | 34% |
| Total Compensation | HK$6.7m | HK$6.6m | 100% |
Speaking on an industry level, nearly 70% of total compensation represents salary, while the remainder of 30% is other remuneration. There isn't a significant difference between Pioneer Global Group and the broader market, in terms of salary allocation in the overall compensation package. 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.
Pioneer Global Group Limited's Growth
Over the last three years, Pioneer Global Group Limited has shrunk its earnings per share by 67% per year. It saw its revenue drop 59% over the last year.
Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Pioneer Global Group Limited Been A Good Investment?
With a three year total loss of 41% for the shareholders, Pioneer Global Group Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.
In Summary...
As previously discussed, Kenny is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. Disappointingly, share price gains over the last three years have failed to materialize. What's equally worrying is that the company isn't growing by our analysis. Understandably, the company's shareholders might have some questions about the CEO's remuneration, given the disappointing performance.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 1 warning sign for Pioneer Global Group that investors should be aware of in a dynamic business environment.
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.
If you decide to trade Pioneer Global Group, use the lowest-cost* platform that is rated #1 Overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account. Promoted
New: Manage All Your Stock Portfolios in One Place
We've created the ultimate portfolio companion for stock investors, and it's free.
• Connect an unlimited number of Portfolios and see your total in one currency
• Be alerted to new Warning Signs or Risks via email or mobile
• Track the Fair Value of your stocks
This article by Simply Wall St is general in nature. 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.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
About SEHK:224
Pioneer Global Group
An investment holding company, engages in the real estate investment business in Hong Kong and internationally.
Fair value with imperfect balance sheet.
