Here's What We Think About Frontken Corporation Berhad's (KLSE:FRONTKN) CEO Pay

Nicholas Ng became the CEO of Frontken Corporation Berhad (KLSE:FRONTKN) in 2012, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Frontken Corporation Berhad.

See our latest analysis for Frontken Corporation Berhad

How Does Total Compensation For Nicholas Ng Compare With Other Companies In The Industry?

At the time of writing, our data shows that Frontken Corporation Berhad has a market capitalization of RM3.4b, and reported total annual CEO compensation of RM3.7m for the year to December 2019. That's a notable increase of 15% on last year. While we always look at total compensation first, our analysis shows that the salary component is less, at RM73k.

For comparison, other companies in the same industry with market capitalizations ranging between RM1.6b and RM6.5b had a median total CEO compensation of RM1.2m. This suggests that Nicholas Ng is paid more than the median for the industry. What's more, Nicholas Ng holds RM22m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Talking in terms of the industry, salary represented approximately 83% of total compensation out of all the companies we analyzed, while other remuneration made up 17% of the pie. Investors may find it interesting that Frontken Corporation Berhad paid a marginal salary to Nicholas Ng, over the past year, focusing on non-salary compensation instead. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Frontken Corporation Berhad's Growth Numbers

Over the past three years, Frontken Corporation Berhad has seen its earnings per share (EPS) grow by 36% per year. Its revenue is up 4.9% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has Frontken Corporation Berhad Been A Good Investment?

We think that the total shareholder return of 766%, over three years, would leave most Frontken Corporation Berhad shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

Frontken Corporation Berhad prefers rewarding its CEO through non-salary benefits. As previously discussed, Nicholas is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. But EPS growth and shareholder returns have been top-notch for the past three years. Considering such exceptional results for the company, we'd venture to say CEO compensation is fair. The pleasing shareholder returns are the cherry on top. We wouldn't be wrong in saying that shareholders feel that Nicholas's performance creates value for the company.

So you may want to check if insiders are buying Frontken Corporation Berhad shares with their own money (free access).

Switching gears from Frontken Corporation 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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This article by Simply Wall St is general in nature. 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.
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