Shareholders Will Probably Hold Off On Increasing Alam Maritim Resources Berhad's (KLSE:ALAM) CEO Compensation For The Time Being

In the past three years, the share price of Alam Maritim Resources Berhad (KLSE:ALAM) has struggled to grow and now shareholders are sitting on a loss. However, what is unusual is that EPS growth has been positive, suggesting that the share price has diverged from fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 14 December 2022. They could also influence management through voting on resolutions such as executive remuneration. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

View our latest analysis for Alam Maritim Resources Berhad

Comparing Alam Maritim Resources Berhad's CEO Compensation With The Industry

According to our data, Alam Maritim Resources Berhad has a market capitalization of RM38m, and paid its CEO total annual compensation worth RM1.5m over the year to December 2021. Notably, that's an increase of 39% over the year before. Notably, the salary which is RM1.19m, represents most of the total compensation being paid.

In comparison with other companies in the industry with market capitalizations under RM879m, the reported median total CEO compensation was RM1.3m. From this we gather that Azmi Bin Ahmad is paid around the median for CEOs in the industry.

Component	2021	2020	Proportion (2021)
Salary	RM1.2m	RM943k	81%
Other	RM274k	RM113k	19%
Total Compensation	RM1.5m	RM1.1m	100%

On an industry level, around 68% of total compensation represents salary and 32% is other remuneration. It's interesting to note that Alam Maritim Resources Berhad pays out a greater portion of remuneration through salary, compared to the industry. 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 Alam Maritim Resources Berhad's Growth Numbers

Alam Maritim Resources Berhad's earnings per share (EPS) grew 17% per year over the last three years. It achieved revenue growth of 39% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. The combination of strong revenue growth with medium-term EPS improvement certainly points to the kind of growth we like to see. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Alam Maritim Resources Berhad Been A Good Investment?

With a total shareholder return of -79% over three years, Alam Maritim Resources Berhad shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

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. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. Shareholders would probably be keen to find out what are the other factors could be weighing down the stock. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with 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 4 warning signs for Alam Maritim Resources Berhad that you should be aware of before investing.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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.