What Can We Make Of Prime Intelligence Solutions Group's (HKG:8379) CEO Compensation?

By
Simply Wall St
Published
February 10, 2021
SEHK:8379
Source: Shutterstock

Tony Yuen is the CEO of Prime Intelligence Solutions Group Limited (HKG:8379), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also assess whether Prime Intelligence Solutions Group pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Check out our latest analysis for Prime Intelligence Solutions Group

Comparing Prime Intelligence Solutions Group Limited's CEO Compensation With the industry

Our data indicates that Prime Intelligence Solutions Group Limited has a market capitalization of HK$42m, and total annual CEO compensation was reported as HK$2.5m for the year to March 2020. We note that's an increase of 19% above last year. We note that the salary portion, which stands at HK$1.61m constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$1.9m. This suggests that Tony Yuen is paid more than the median for the industry.

Component20202019Proportion (2020)
Salary HK$1.6m HK$1.1m 63%
Other HK$932k HK$1.1m 37%
Total CompensationHK$2.5m HK$2.1m100%

On an industry level, roughly 78% of total compensation represents salary and 22% is other remuneration. Prime Intelligence Solutions Group sets aside a smaller share of compensation for salary, in comparison to the overall industry. 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.

ceo-compensation
SEHK:8379 CEO Compensation February 11th 2021

Prime Intelligence Solutions Group Limited's Growth

Over the last three years, Prime Intelligence Solutions Group Limited has shrunk its earnings per share by 102% per year. Its revenue is down 12% over the previous year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-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 Prime Intelligence Solutions Group Limited Been A Good Investment?

With a three year total loss of 86% for the shareholders, Prime Intelligence Solutions Group Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

As we noted earlier, Prime Intelligence Solutions Group pays its CEO higher than the norm for similar-sized companies belonging to the same industry. Disappointingly, share price gains over the last three years have failed to materialize. Arguably worse, we've been waiting for positive EPS growth for the last three years. Understandably, the company's shareholders might have some questions about the CEO's remuneration, given the disappointing performance.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 3 warning signs (and 2 which are a bit concerning) in Prime Intelligence Solutions Group we think you should know about.

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. 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.
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