How Much Is APT Satellite Holdings' (HKG:1045) CEO Getting Paid?

This article will reflect on the compensation paid to Guangren Cheng who has served as CEO of APT Satellite Holdings Limited (HKG:1045) since 2008. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for APT Satellite Holdings

Comparing APT Satellite Holdings Limited's CEO Compensation With the industry

Our data indicates that APT Satellite Holdings Limited has a market capitalization of HK$1.6b, and total annual CEO compensation was reported as HK$4.2m for the year to December 2019. Notably, that's a decrease of 25% over the year before. We note that the salary portion, which stands at HK$2.64m constitutes the majority of total compensation received by the CEO.

On comparing similar companies from the same industry with market caps ranging from HK$775m to HK$3.1b, we found that the median CEO total compensation was HK$4.1m. So it looks like APT Satellite Holdings compensates Guangren Cheng in line with the median for the industry.

On an industry level, around 34% of total compensation represents salary and 66% is other remuneration. It's interesting to note that APT Satellite Holdings pays out a greater portion of remuneration through salary, compared to the industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at APT Satellite Holdings Limited's Growth Numbers

Over the last three years, APT Satellite Holdings Limited has shrunk its earnings per share by 25% per year. Its revenue is down 19% over the previous year.

The decline in EPS is a bit concerning. 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 APT Satellite Holdings Limited Been A Good Investment?

Given the total shareholder loss of 40% over three years, many shareholders in APT Satellite Holdings Limited are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be lessto generous with CEO compensation.

To Conclude...

As previously discussed, Guangren is compensated close to the median for companies of its size, and which belong to the same industry. In the meantime, the company has reported declining EPS growth and shareholder returns over the last three years. We'd stop short of saying compensation is inappropriate, but we would understand if shareholders had questions regarding a future raise.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 3 warning signs for APT Satellite Holdings you should be aware of, and 1 of them is significant.

Important note: APT Satellite Holdings is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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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