Sarawak Consolidated Industries Berhad's (KLSE:SCIB) CEO Might Not Expect Shareholders To Be So Generous This Year

Shareholders will probably not be too impressed with the underwhelming results at Sarawak Consolidated Industries Berhad (KLSE:SCIB) recently. At the upcoming AGM on 08 December 2022, shareholders can hear from the board including their plans for turning around performance. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Check out our latest analysis for Sarawak Consolidated Industries Berhad

How Does Total Compensation For Rosland Bin Othman Compare With Other Companies In The Industry?

Our data indicates that Sarawak Consolidated Industries Berhad has a market capitalization of RM84m, and total annual CEO compensation was reported as RM1.0m for the year to June 2022. That's a notable decrease of 12% on last year. In particular, the salary of RM686.1k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the industry with market capitalizations below RM887m, we found that the median total CEO compensation was RM756k. Hence, we can conclude that Rosland Bin Othman is remunerated higher than the industry median.

Component	2022	2021	Proportion (2022)
Salary	RM686k	RM800k	68%
Other	RM328k	RM351k	32%
Total Compensation	RM1.0m	RM1.2m	100%

On an industry level, around 71% of total compensation represents salary and 29% is other remuneration. There isn't a significant difference between Sarawak Consolidated Industries Berhad and the broader market, in terms of salary allocation in the overall compensation package. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at Sarawak Consolidated Industries Berhad's Growth Numbers

Over the last three years, Sarawak Consolidated Industries Berhad has shrunk its earnings per share by 22% per year. Its revenue is down 3.2% over the previous year.

The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. 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 Sarawak Consolidated Industries Berhad Been A Good Investment?

With a total shareholder return of -67% over three years, Sarawak Consolidated Industries Berhad shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

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.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for Sarawak Consolidated Industries Berhad that you should be aware of before investing.

Important note: Sarawak Consolidated Industries Berhad 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. 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.