Expert Systems Holdings Limited's (HKG:8319) CEO Compensation Is Looking A Bit Stretched At The Moment

Key Insights

• Expert Systems Holdings to hold its Annual General Meeting on 16th of September
• Salary of HK$2.37m is part of CEO Andy Lau's total remuneration
• The total compensation is 55% higher than the average for the industry
• Expert Systems Holdings' EPS declined by 2.9% over the past three years while total shareholder return over the past three years was 33%

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Despite Expert Systems Holdings Limited's (HKG:8319) share price growing positively in the past few years, the per-share earnings growth has not grown to investors' expectations, suggesting that there could be other factors at play driving the share price. The upcoming AGM on 16th of September may be an opportunity for shareholders to bring up any concerns they may have for the board’s attention. One way that shareholders can influence managerial decisions is through voting on CEO and executive remuneration packages, which studies show could impact company performance. From the data that we gathered, we think that shareholders should hold off on a raise on CEO compensation until performance starts to show some improvement.

Check out our latest analysis for Expert Systems Holdings

How Does Total Compensation For Andy Lau Compare With Other Companies In The Industry?

According to our data, Expert Systems Holdings Limited has a market capitalization of HK$92m, and paid its CEO total annual compensation worth HK$2.5m over the year to March 2025. That's slightly lower by 3.8% over the previous year. Notably, the salary which is HK$2.37m, represents most of the total compensation being paid.

In comparison with other companies in the Hong Kong IT industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$1.6m. Accordingly, our analysis reveals that Expert Systems Holdings Limited pays Andy Lau north of the industry median. Moreover, Andy Lau also holds HK$12m worth of Expert Systems Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 89% of total compensation represents salary, while the remainder of 11% is other remuneration. Our data reveals that Expert Systems Holdings 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 Expert Systems Holdings Limited's Growth Numbers

Expert Systems Holdings Limited has reduced its earnings per share by 2.9% a year over the last three years. In the last year, its revenue is down 9.1%.

A lack of EPS improvement is not good to see. And the fact that revenue is down year on year arguably paints an ugly picture. So given this relatively weak performance, shareholders would probably not want to see high compensation 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 Expert Systems Holdings Limited Been A Good Investment?

Expert Systems Holdings Limited has generated a total shareholder return of 33% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

To Conclude...

Shareholder returns, while positive, should be looked at along with earnings, which have not grown at all recently. This makes us think the share price momentum may slow in the future. Shareholders should make the most of the coming opportunity to question the board on key concerns they may have and revisit their investment thesis with regards to the company.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 2 warning signs for Expert Systems Holdings (1 doesn't sit too well with us!) that you should be aware of before investing here.

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.

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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.