Directel Holdings Limited's (HKG:8337) CEO Will Probably Struggle To See A Pay Rise This Year

Key Insights

• Directel Holdings to hold its Annual General Meeting on 6th of June
• CEO Kwok Chau Pang's total compensation includes salary of HK$493.0k
• The overall pay is 66% below the industry average
• Directel Holdings' three-year loss to shareholders was 44% while its EPS was down 53% over the past three years

Performance at Directel Holdings Limited (HKG:8337) has not been particularly rosy recently and shareholders will likely be holding CEO Kwok Chau Pang and the board accountable for this. There is an opportunity for shareholders to influence management to turn the performance around by voting on resolutions such as executive remuneration at the AGM coming up on 6th of June. The data we gathered below shows that CEO compensation looks acceptable for now.

Check out our latest analysis for Directel Holdings

How Does Total Compensation For Kwok Chau Pang Compare With Other Companies In The Industry?

Our data indicates that Directel Holdings Limited has a market capitalization of HK$18m, and total annual CEO compensation was reported as HK$639k for the year to December 2023. This means that the compensation hasn't changed much from last year. In particular, the salary of HK$493.0k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the Hong Kong Wireless Telecom industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$1.9m. That is to say, Kwok Chau Pang is paid under the industry median.

Component	2023	2022	Proportion (2023)
Salary	HK$493k	HK$492k	77%
Other	HK$146k	HK$146k	23%
Total Compensation	HK$639k	HK$638k	100%

On an industry level, roughly 39% of total compensation represents salary and 61% is other remuneration. It's interesting to note that Directel Holdings pays out a greater portion of remuneration through salary, compared to the industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Directel Holdings Limited's Growth

Over the last three years, Directel Holdings Limited has shrunk its earnings per share by 53% per year. The trailing twelve months of revenue was pretty much the same as the prior period.

The decline in EPS is a bit concerning. And the flat revenue is seriously uninspiring. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Directel Holdings Limited Been A Good Investment?

The return of -44% over three years would not have pleased Directel Holdings Limited shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 2 warning signs for Directel 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.

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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.