Here's Why Shareholders Should Examine Freetech Road Recycling Technology (Holdings) Limited's (HKG:6888) CEO Compensation Package More Closely
Key Insights
- Freetech Road Recycling Technology (Holdings)'s Annual General Meeting to take place on 30th of May
- CEO Wai Pan Sze's total compensation includes salary of HK$3.58m
- Total compensation is 286% above industry average
- Over the past three years, Freetech Road Recycling Technology (Holdings)'s EPS fell by 54% and over the past three years, the total loss to shareholders 20%
Shareholders will probably not be too impressed with the underwhelming results at Freetech Road Recycling Technology (Holdings) Limited (HKG:6888) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 30th 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.
See our latest analysis for Freetech Road Recycling Technology (Holdings)
How Does Total Compensation For Wai Pan Sze Compare With Other Companies In The Industry?
Our data indicates that Freetech Road Recycling Technology (Holdings) Limited has a market capitalization of HK$194m, and total annual CEO compensation was reported as HK$3.7m for the year to December 2024. That is, the compensation was roughly the same as last year. We note that the salary portion, which stands at HK$3.58m constitutes the majority of total compensation received by the CEO.
On comparing similar-sized companies in the Hong Kong Infrastructure industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was HK$956k. Accordingly, our analysis reveals that Freetech Road Recycling Technology (Holdings) Limited pays Wai Pan Sze north of the industry median. What's more, Wai Pan Sze holds HK$98m 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$3.6m | HK$3.5m | 97% |
| Other | HK$118k | HK$118k | 3% |
| Total Compensation | HK$3.7m | HK$3.6m | 100% |
Speaking on an industry level, nearly 60% of total compensation represents salary, while the remainder of 40% is other remuneration. Freetech Road Recycling Technology (Holdings) pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
Freetech Road Recycling Technology (Holdings) Limited's Growth
Over the last three years, Freetech Road Recycling Technology (Holdings) Limited has shrunk its earnings per share by 54% 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. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Freetech Road Recycling Technology (Holdings) Limited Been A Good Investment?
Since shareholders would have lost about 20% over three years, some Freetech Road Recycling Technology (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...
Freetech Road Recycling Technology (Holdings) pays its CEO a majority of compensation through a salary. 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, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.
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 2 warning signs for Freetech Road Recycling Technology (Holdings) you should be aware of, and 1 of them is a bit unpleasant.
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.
Valuation is complex, but we're here to simplify it.
Discover if Freetech Road Recycling Technology (Holdings) might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.
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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.