Shareholders May Not Be So Generous With Kim Hin Industry Berhad's (KLSE:KIMHIN) CEO Compensation And Here's Why

Key Insights

• Kim Hin Industry Berhad will host its Annual General Meeting on 29th of May
• Salary of RM1.02m is part of CEO John Chua's total remuneration
• The total compensation is 268% higher than the average for the industry
• Kim Hin Industry Berhad's EPS grew by 7.8% over the past three years while total shareholder loss over the past three years was 35%

We've discovered 3 warning signs about Kim Hin Industry Berhad. View them for free.

In the past three years, the share price of Kim Hin Industry Berhad (KLSE:KIMHIN) has struggled to grow and now shareholders are sitting on a loss. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 29th of May. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. We think shareholders might be reluctant to increase compensation for the CEO at the moment, according to our analysis below.

View our latest analysis for Kim Hin Industry Berhad

How Does Total Compensation For John Chua Compare With Other Companies In The Industry?

At the time of writing, our data shows that Kim Hin Industry Berhad has a market capitalization of RM60m, and reported total annual CEO compensation of RM1.3m for the year to December 2024. This means that the compensation hasn't changed much from last year. We note that the salary portion, which stands at RM1.02m constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the Malaysia Building industry with market capitalizations below RM855m, we found that the median total CEO compensation was RM347k. This suggests that John Chua is paid more than the median for the industry. Moreover, John Chua also holds RM226k worth of Kim Hin Industry Berhad stock directly under their own name.

Component	2024	2023	Proportion (2024)
Salary	RM1.0m	RM1.0m	80%
Other	RM259k	RM263k	20%
Total Compensation	RM1.3m	RM1.3m	100%

Speaking on an industry level, nearly 80% of total compensation represents salary, while the remainder of 20% is other remuneration. Our data reveals that Kim Hin Industry Berhad allocates salary more or less in line with the wider market. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Kim Hin Industry Berhad's Growth Numbers

Kim Hin Industry Berhad has seen its earnings per share (EPS) increase by 7.8% a year over the past three years. The trailing twelve months of revenue was pretty much the same as the prior period.

We'd prefer higher revenue growth, but it is good to see modest EPS growth. So there are some positives here, but not enough to earn high praise. 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 Kim Hin Industry Berhad Been A Good Investment?

With a total shareholder return of -35% over three years, Kim Hin Industry Berhad shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. Shareholders would be keen to know what's holding the stock back when earnings have grown. At the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 3 warning signs for Kim Hin Industry Berhad (2 are a bit unpleasant!) that you should be aware of before investing here.

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.