Here's Why It's Unlikely That Ahsay Backup Software Development Company Limited's (HKG:8290) CEO Will See A Pay Rise This Year

Ahsay Backup Software Development Company Limited (HKG:8290) has not performed well recently and CEO Schubert Chong will probably need to up their game. At the upcoming AGM on 30 April 2021, shareholders can hear from the board including their plans for turning around performance. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.

View our latest analysis for Ahsay Backup Software Development

Comparing Ahsay Backup Software Development Company Limited's CEO Compensation With the industry

According to our data, Ahsay Backup Software Development Company Limited has a market capitalization of HK$60m, and paid its CEO total annual compensation worth HK$3.6m over the year to December 2020. That's slightly lower by 3.2% over the previous year. Notably, the salary which is HK$3.12m, represents most of the total compensation being paid.

On comparing similar-sized companies in the industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was HK$1.1m. This suggests that Schubert Chong is paid more than the median for the industry.

Component	2020	2019	Proportion (2020)
Salary	HK$3.1m	HK$3.0m	88%
Other	HK$426k	HK$649k	12%
Total Compensation	HK$3.6m	HK$3.7m	100%

On an industry level, roughly 82% of total compensation represents salary and 18% is other remuneration. There isn't a significant difference between Ahsay Backup Software Development and the broader market, in terms of salary allocation in the overall compensation package. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Ahsay Backup Software Development Company Limited's Growth

Ahsay Backup Software Development Company Limited has reduced its earnings per share by 73% a year over the last three years. It saw its revenue drop 7.2% over the last year.

The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. 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 Ahsay Backup Software Development Company Limited Been A Good Investment?

The return of -71% over three years would not have pleased Ahsay Backup Software Development Company Limited shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. 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 compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 2 warning signs for Ahsay Backup Software Development that investors should look into moving forward.

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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