How Is Sinosoft Technology Group's (HKG:1297) CEO Compensated?

The CEO of Sinosoft Technology Group Limited (HKG:1297) is Yingmei Xin, and this article examines the executive's compensation against the backdrop of overall company performance. 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 Sinosoft Technology Group

How Does Total Compensation For Yingmei Xin Compare With Other Companies In The Industry?

According to our data, Sinosoft Technology Group Limited has a market capitalization of HK$1.5b, and paid its CEO total annual compensation worth CN¥2.8m over the year to December 2019. That's a notable increase of 12% on last year. Notably, the salary which is CN¥2.74m, represents most of the total compensation being paid.

For comparison, other companies in the same industry with market capitalizations ranging between HK$775m and HK$3.1b had a median total CEO compensation of CN¥2.1m. Accordingly, our analysis reveals that Sinosoft Technology Group Limited pays Yingmei Xin north of the industry median. Moreover, Yingmei Xin also holds HK$704m worth of Sinosoft Technology Group stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, roughly 82% of total compensation represents salary and 18% is other remuneration. Investors will find it interesting that Sinosoft Technology Group pays the bulk of its rewards through a traditional salary, instead of non-salary benefits. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Sinosoft Technology Group Limited's Growth Numbers

Over the past three years, Sinosoft Technology Group Limited has seen its earnings per share (EPS) grow by 9.9% per year. In the last year, its revenue is down 8.6%.

We would prefer it if there was revenue growth, but the modest improvement in EPS is good. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has Sinosoft Technology Group Limited Been A Good Investment?

With a three year total loss of 43% for the shareholders, Sinosoft Technology Group Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

Sinosoft Technology Group pays its CEO a majority of compensation through a salary. As we noted earlier, Sinosoft Technology Group pays its CEO higher than the norm for similar-sized companies belonging to the same industry. Over the last three years, shareholder returns have been downright disappointing for Sinosoft Technology Group, and although EPS growth is steady, it hasn't set the world on fire. This doesn't look good when you see that Yingmei is earning more than the industry median. With such poor returns, we would understand if shareholders had concerns related to the CEO's pay.

CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 1 warning sign for Sinosoft Technology Group that investors should look into moving forward.

Switching gears from Sinosoft Technology Group, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.
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