Here's Why Shareholders Should Examine K & P International Holdings Limited's (HKG:675) CEO Compensation Package More Closely

Key Insights

• K & P International Holdings' Annual General Meeting to take place on 27th of May
• CEO Pei Wor Lai's total compensation includes salary of HK$2.88m
• Total compensation is similar to the industry average
• K & P International Holdings' EPS declined by 98% over the past three years while total shareholder loss over the past three years was 19%

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K & P International Holdings Limited (HKG:675) has not performed well recently and CEO Pei Wor Lai 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 27th of May. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Check out our latest analysis for K & P International Holdings

Comparing K & P International Holdings Limited's CEO Compensation With The Industry

Our data indicates that K & P International Holdings Limited has a market capitalization of HK$104m, and total annual CEO compensation was reported as HK$2.9m for the year to December 2024. That's mostly flat as compared to the prior year's compensation. Notably, the salary which is HK$2.88m, represents most of the total compensation being paid.

For comparison, other companies in the Hong Kong Electronic industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$2.4m. So it looks like K & P International Holdings compensates Pei Wor Lai in line with the median for the industry. What's more, Pei Wor Lai holds HK$52m 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	HK$2.9m	HK$2.9m	99%
Other	HK$36k	HK$53k	1%
Total Compensation	HK$2.9m	HK$2.9m	100%

Speaking on an industry level, nearly 79% of total compensation represents salary, while the remainder of 21% is other remuneration. Investors will find it interesting that K & P International Holdings pays the bulk of its rewards through a traditional salary, instead of non-salary benefits. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

K & P International Holdings Limited's Growth

K & P International Holdings Limited has reduced its earnings per share by 98% a year over the last three years. In the last year, its revenue is down 5.0%.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 K & P International Holdings Limited Been A Good Investment?

Since shareholders would have lost about 19% over three years, some K & P International Holdings Limited investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

K & P International Holdings pays its CEO a majority of compensation through a salary. Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. 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 is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 3 warning signs for K & P International Holdings (of which 2 are significant!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from K & P International Holdings, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.