How Much is Hailiang International Holdings' (HKG:2336) CEO Getting Paid?

This article will reflect on the compensation paid to Feng Luming who has served as CEO of Hailiang International Holdings Limited (HKG:2336) since 2017. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Hailiang International Holdings.

See our latest analysis for Hailiang International Holdings

Comparing Hailiang International Holdings Limited's CEO Compensation With the industry

At the time of writing, our data shows that Hailiang International Holdings Limited has a market capitalization of HK$336m, and reported total annual CEO compensation of HK$556k for the year to December 2019. That is, the compensation was roughly the same as last year. We note that the salary portion, which stands at HK$520.0k constitutes the majority of total compensation received by the CEO.

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$1.9m. That is to say, Feng Luming is paid under the industry median.

Talking in terms of the industry, salary represented approximately 76% of total compensation out of all the companies we analyzed, while other remuneration made up 24% of the pie. Hailiang International Holdings is paying a higher share of its remuneration through a salary in comparison to the overall industry. 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 Hailiang International Holdings Limited's Growth Numbers

Over the last three years, Hailiang International Holdings Limited has shrunk its earnings per share by 80% per year. Its revenue is down 57% over the previous year.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Hailiang International Holdings Limited Been A Good Investment?

With a three year total loss of 54% for the shareholders, Hailiang International Holdings Limited would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

As we noted earlier, Hailiang International Holdings pays its CEO lower than the norm for similar-sized companies belonging to the same industry. EPS growth has failed to impress us, and the same can be said about shareholder returns. We can't say the CEO compensation is high, but shareholders will be cold to a bump at this stage, considering negative investor returns.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for Hailiang International Holdings that you should be aware of before investing.

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.

If you decide to trade Hailiang International Holdings, use the lowest-cost* platform that is rated #1 Overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.