Naim Holdings Berhad's (KLSE:NAIM) CEO Compensation Is Looking A Bit Stretched At The Moment

Under the guidance of CEO Hasmi Bin Hasnan, Naim Holdings Berhad (KLSE:NAIM) has performed reasonably well recently. As shareholders go into the upcoming AGM on 24 June 2021, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still want to keep CEO compensation within reason.

Check out our latest analysis for Naim Holdings Berhad

Comparing Naim Holdings Berhad's CEO Compensation With the industry

According to our data, Naim Holdings Berhad has a market capitalization of RM383m, and paid its CEO total annual compensation worth RM2.1m over the year to December 2020. We note that's a small decrease of 3.3% on last year. In particular, the salary of RM1.63m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the industry with market capitalizations below RM824m, reported a median total CEO compensation of RM781k. Hence, we can conclude that Hasmi Bin Hasnan is remunerated higher than the industry median. What's more, Hasmi Bin Hasnan holds RM43m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2020	2019	Proportion (2020)
Salary	RM1.6m	RM1.7m	79%
Other	RM436k	RM445k	21%
Total Compensation	RM2.1m	RM2.1m	100%

On an industry level, around 80% of total compensation represents salary and 20% is other remuneration. Although there is a difference in how total compensation is set, Naim Holdings Berhad more or less reflects the market in terms of setting the salary. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Naim Holdings Berhad's Growth Numbers

Naim Holdings Berhad's earnings per share (EPS) grew 80% per year over the last three years. It achieved revenue growth of 79% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. 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 Naim Holdings Berhad Been A Good Investment?

Boasting a total shareholder return of 38% over three years, Naim Holdings Berhad has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 1 warning sign for Naim Holdings Berhad that investors should be aware of in a dynamic business environment.

Switching gears from Naim Holdings Berhad, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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