Shareholders May Be More Conservative With Apollo Food Holdings Berhad's (KLSE:APOLLO) CEO Compensation For Now

The share price of Apollo Food Holdings Berhad (KLSE:APOLLO) has been growing in the past few years, however, the per-share earnings growth has been lacking, suggesting something is amiss. These concerns will be at the front of shareholders' minds as they go into the AGM coming up on 27 October 2022. It would also be an opportunity for them to influence management through exercising their voting power on company resolutions, including CEO and executive remuneration, which could impact on firm performance in the future. From what we gathered, we think shareholders should be wary of raising CEO compensation until the company shows some marked improvement.

View our latest analysis for Apollo Food Holdings Berhad

Comparing Apollo Food Holdings Berhad's CEO Compensation With The Industry

Our data indicates that Apollo Food Holdings Berhad has a market capitalization of RM302m, and total annual CEO compensation was reported as RM3.0m for the year to April 2022. We note that's an increase of 14% above last year. We note that the salary portion, which stands at RM2.54m constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under RM945m, the reported median total CEO compensation was RM523k. Hence, we can conclude that Kim Liang is remunerated higher than the industry median. Moreover, Kim Liang also holds RM851k worth of Apollo Food Holdings Berhad stock directly under their own name.

Component	2022	2021	Proportion (2022)
Salary	RM2.5m	RM2.4m	85%
Other	RM447k	RM276k	15%
Total Compensation	RM3.0m	RM2.6m	100%

Speaking on an industry level, nearly 68% of total compensation represents salary, while the remainder of 32% is other remuneration. Apollo Food Holdings Berhad pays out 85% of remuneration in the form of a salary, significantly higher than the industry average. 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.

Apollo Food Holdings Berhad's Growth

Over the last three years, Apollo Food Holdings Berhad has shrunk its earnings per share by 4.4% per year. In the last year, its revenue is up 11%.

The decline in EPS is a bit concerning. And while it's good to see some good revenue growth recently, the growth isn't really fast enough for us to put aside my concerns around EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. 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 Apollo Food Holdings Berhad Been A Good Investment?

Apollo Food Holdings Berhad has generated a total shareholder return of 17% over three years, so most shareholders would be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

While it's true that shareholders have owned decent returns, it's hard to overlook the lack of earnings growth and this makes us question whether these returns will continue. In the upcoming AGM, shareholders will get the opportunity to discuss any concerns with the board, including those related to CEO remuneration and assess if the board's plan will likely improve performance in the future.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. In our study, we found 3 warning signs for Apollo Food Holdings Berhad you should be aware of, and 1 of them shouldn't be ignored.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.