It Looks Like British American Tobacco (Malaysia) Berhad's (KLSE:BAT) CEO May Expect Their Salary To Be Put Under The Microscope

Key Insights

• British American Tobacco (Malaysia) Berhad's Annual General Meeting to take place on 29th of April
• Salary of RM1.27m is part of CEO Nedal Salem's total remuneration
• The overall pay is 320% above the industry average
• Over the past three years, British American Tobacco (Malaysia) Berhad's EPS fell by 14% and over the past three years, the total loss to shareholders 40%

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Shareholders will probably not be too impressed with the underwhelming results at British American Tobacco (Malaysia) Berhad (KLSE:BAT) recently. At the upcoming AGM on 29th of April, 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. The data we present below explains why we think CEO compensation is not consistent with recent performance.

Check out our latest analysis for British American Tobacco (Malaysia) Berhad

Comparing British American Tobacco (Malaysia) Berhad's CEO Compensation With The Industry

Our data indicates that British American Tobacco (Malaysia) Berhad has a market capitalization of RM1.8b, and total annual CEO compensation was reported as RM4.1m for the year to December 2024. We note that's an increase of 12% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at RM1.3m.

In comparison with other companies in the Malaysia Tobacco industry with market capitalizations ranging from RM878m to RM3.5b, the reported median CEO total compensation was RM984k. Hence, we can conclude that Nedal Salem is remunerated higher than the industry median.

Component	2024	2023	Proportion (2024)
Salary	RM1.3m	RM1.1m	31%
Other	RM2.9m	RM2.6m	69%
Total Compensation	RM4.1m	RM3.7m	100%

On an industry level, roughly 29% of total compensation represents salary and 71% is other remuneration. British American Tobacco (Malaysia) Berhad is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

A Look at British American Tobacco (Malaysia) Berhad's Growth Numbers

Over the last three years, British American Tobacco (Malaysia) Berhad has shrunk its earnings per share by 14% per year. Its revenue is down 1.3% 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. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 British American Tobacco (Malaysia) Berhad Been A Good Investment?

With a total shareholder return of -40% over three years, British American Tobacco (Malaysia) Berhad shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 3 warning signs for British American Tobacco (Malaysia) Berhad (1 is significant!) that you should be aware of before investing here.

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.