Should Shareholders Reconsider Tian Teck Land Limited's (HKG:266) CEO Compensation Package?

Shareholders will probably not be too impressed with the underwhelming results at Tian Teck Land Limited (HKG:266) recently. At the upcoming AGM on 09 September 2021, shareholders can hear from the board including their plans for turning around performance. 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. From our analysis, we think CEO compensation may need a review in light of the recent performance.

View our latest analysis for Tian Teck Land

How Does Total Compensation For Hooi Hong Cheong Compare With Other Companies In The Industry?

According to our data, Tian Teck Land Limited has a market capitalization of HK$2.3b, and paid its CEO total annual compensation worth HK$2.3m over the year to March 2021. Notably, that's a decrease of 14% over the year before. Notably, the salary which is HK$1.51m, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations ranging from HK$777m to HK$3.1b, the reported median CEO total compensation was HK$2.8m. From this we gather that Hooi Hong Cheong is paid around the median for CEOs in the industry. What's more, Hooi Hong Cheong holds HK$22m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2021	2020	Proportion (2021)
Salary	HK$1.5m	HK$1.9m	65%
Other	HK$800k	HK$800k	35%
Total Compensation	HK$2.3m	HK$2.7m	100%

Talking in terms of the industry, salary represented approximately 69% of total compensation out of all the companies we analyzed, while other remuneration made up 31% of the pie. Our data reveals that Tian Teck Land allocates salary more or less in line with the wider market. 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.

A Look at Tian Teck Land Limited's Growth Numbers

Over the last three years, Tian Teck Land Limited has shrunk its earnings per share by 106% per year. In the last year, its revenue is down 26%.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Tian Teck Land Limited Been A Good Investment?

Few Tian Teck Land Limited shareholders would feel satisfied with the return of -39% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

CEO pay is simply one of the many factors that need to be considered while examining business performance. In our study, we found 2 warning signs for Tian Teck Land you should be aware of, and 1 of them is a bit unpleasant.

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.
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