Chern Lim has been the CEO of Yinson Holdings Berhad (KLSE:YINSON) since 2014, and this article will examine the executive's compensation with respect to the overall performance of the company. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Yinson Holdings Berhad.
Comparing Yinson Holdings Berhad's CEO Compensation With the industry
At the time of writing, our data shows that Yinson Holdings Berhad has a market capitalization of RM6.0b, and reported total annual CEO compensation of RM4.7m for the year to January 2020. Notably, that's an increase of 14% over the year before. In particular, the salary of RM3.05m, makes up a huge portion of the total compensation being paid to the CEO.
In comparison with other companies in the industry with market capitalizations ranging from RM4.1b to RM13b, the reported median CEO total compensation was RM16m. Accordingly, Yinson Holdings Berhad pays its CEO under the industry median. Furthermore, Chern Lim directly owns RM3.0m worth of shares in the company, implying that they are deeply invested in the company's success.
Talking in terms of the industry, salary represented approximately 82% of total compensation out of all the companies we analyzed, while other remuneration made up 18% of the pie. In Yinson Holdings Berhad's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at Yinson Holdings Berhad's Growth Numbers
Yinson Holdings Berhad's earnings per share (EPS) grew 2.6% per year over the last three years. Its revenue is up 464% over the last year.
It's hard to interpret the strong revenue growth as anything other than a positive. And in that context, the modest EPS improvement certainly isn't shabby. We'd stop short of saying the business performance is amazing, but there are enough positives to justify further research, or even adding the stock to your watch-list. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.
Has Yinson Holdings Berhad Been A Good Investment?
We think that the total shareholder return of 38%, over three years, would leave most Yinson Holdings 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.
As we noted earlier, Yinson Holdings Berhad pays its CEO lower than the norm for similar-sized companies belonging to the same industry. However, shareholder returns are rock solid over the past three years, and that’s undoubtedly a good sign. Considering this fine result for investors, we believe CEO compensation to be apt.
We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 2 warning signs for Yinson Holdings Berhad you should be aware of, and 1 of them makes us a bit uncomfortable.
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. 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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