Shareholders May Be Wary Of Increasing Kinergy Corporation Ltd.'s (HKG:3302) CEO Compensation Package

Key Insights

• Kinergy will host its Annual General Meeting on 21st of May
• Salary of S$419.0k is part of CEO Leslie Lim's total remuneration
• The total compensation is similar to the average for the industry
• Over the past three years, Kinergy's EPS fell by 122% and over the past three years, the total loss to shareholders 73%

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Kinergy Corporation Ltd. (HKG:3302) has not performed well recently and CEO Leslie Lim will probably need to up their game. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 21st of May. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. The data we present below explains why we think CEO compensation is not consistent with recent performance.

Check out our latest analysis for Kinergy

How Does Total Compensation For Leslie Lim Compare With Other Companies In The Industry?

Our data indicates that Kinergy Corporation Ltd. has a market capitalization of HK$115m, and total annual CEO compensation was reported as S$498k for the year to December 2024. We note that's a decrease of 8.5% compared to last year. Notably, the salary which is S$419.0k, represents most of the total compensation being paid.

On comparing similar-sized companies in the Hong Kong Electronic industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was S$406k. So it looks like Kinergy compensates Leslie Lim in line with the median for the industry. What's more, Leslie Lim holds HK$38m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2024	2023	Proportion (2024)
Salary	S$419k	S$409k	84%
Other	S$79k	S$135k	16%
Total Compensation	S$498k	S$544k	100%

On an industry level, roughly 79% of total compensation represents salary and 21% is other remuneration. Although there is a difference in how total compensation is set, Kinergy more or less reflects the market in terms of setting the salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Kinergy Corporation Ltd.'s Growth

Kinergy Corporation Ltd. has reduced its earnings per share by 122% a year over the last three years. Its revenue is up 7.1% over the last year.

The decline in EPS is a bit concerning. The modest increase in revenue in the last year isn't enough to make us overlook the disappointing change in EPS. 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 Kinergy Corporation Ltd. Been A Good Investment?

With a total shareholder return of -73% over three years, Kinergy Corporation Ltd. shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

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.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 3 warning signs for Kinergy (of which 2 can't be ignored!) that you should know about in order to have a holistic understanding of the stock.

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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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.