Here's Why We Think Lvji Technology Holdings Inc.'s (HKG:1745) CEO Compensation Looks Fair
Key Insights
- Lvji Technology Holdings' Annual General Meeting to take place on 25th of June
- Salary of CN¥475.0k is part of CEO Ting Yuan's total remuneration
- The overall pay is 57% below the industry average
- Lvji Technology Holdings' three-year loss to shareholders was 53% while its EPS grew by 117% over the past three years
Shareholders may be wondering what CEO Ting Yuan plans to do to improve the less than great performance at Lvji Technology Holdings Inc. (HKG:1745) recently. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 25th of June. It has been shown that setting appropriate executive remuneration incentivises the management to act in the interests of shareholders. We have prepared some analysis below to show that CEO compensation looks to be reasonable.
View our latest analysis for Lvji Technology Holdings
How Does Total Compensation For Ting Yuan Compare With Other Companies In The Industry?
Our data indicates that Lvji Technology Holdings Inc. has a market capitalization of HK$313m, and total annual CEO compensation was reported as CN¥545k for the year to December 2024. That's a notable increase of 42% on last year. Notably, the salary which is CN¥475.0k, represents most of the total compensation being paid.
On comparing similar-sized companies in the Hong Kong Software industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was CN¥1.3m. That is to say, Ting Yuan is paid under the industry median.
| Component | 2024 | 2023 | Proportion (2024) |
| Salary | CN¥475k | CN¥299k | 87% |
| Other | CN¥70k | CN¥86k | 13% |
| Total Compensation | CN¥545k | CN¥385k | 100% |
Talking in terms of the industry, salary represented approximately 68% of total compensation out of all the companies we analyzed, while other remuneration made up 32% of the pie. Lvji Technology Holdings pays out 87% of remuneration in the form of a salary, significantly higher than the industry average. 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 Lvji Technology Holdings Inc.'s Growth Numbers
Lvji Technology Holdings Inc. has seen its earnings per share (EPS) increase by 117% a year over the past three years. It saw its revenue drop 10% over the last year.
This demonstrates that the company has been improving recently and is good news for the shareholders. While it would be good to see revenue growth, profits matter more in the end. 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 Lvji Technology Holdings Inc. Been A Good Investment?
The return of -53% over three years would not have pleased Lvji Technology Holdings Inc. shareholders. So shareholders would probably want the company to be less generous with CEO compensation.
In Summary...
The fact that shareholders are sitting on a loss is certainly disheartening. This diverges with the robust growth in EPS, suggesting that there is a large discrepancy between share price and fundamentals. There needs to be more focus by management and the board to examine why the share price has diverged from fundamentals. In the upcoming AGM, shareholders will get the opportunity to discuss these concerns with the board and assess if the board's plan is likely to improve company performance.
CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 4 warning signs (and 1 which is a bit unpleasant) in Lvji Technology Holdings we think you should know about.
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.
Valuation is complex, but we're here to simplify it.
Discover if Lvji Technology Holdings might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.
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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.