How Much Is PLS Plantations Berhad (KLSE:PLS) Paying Its CEO?

Kang Lim has been the CEO of PLS Plantations Berhad (KLSE:PLS) since 1994, 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 PLS Plantations Berhad.

See our latest analysis for PLS Plantations Berhad

Comparing PLS Plantations Berhad's CEO Compensation With the industry

According to our data, PLS Plantations Berhad has a market capitalization of RM471m, and paid its CEO total annual compensation worth RM634k over the year to March 2020. That's a slight decrease of 6.5% on the prior year. In particular, the salary of RM624.0k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the industry with market capitalizations below RM810m, we found that the median total CEO compensation was RM625k. From this we gather that Kang Lim is paid around the median for CEOs in the industry. What's more, Kang Lim holds RM39m 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 76% of total compensation out of all the companies we analyzed, while other remuneration made up 24% of the pie. Investors will find it interesting that PLS Plantations Berhad pays the bulk of its rewards through a traditional salary, instead of non-salary benefits. 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.

PLS Plantations Berhad's Growth

PLS Plantations Berhad has reduced its earnings per share by 20% a year over the last three years. In the last year, its revenue is up 37%.

The decrease in EPS could be a concern for some investors. But in contrast the revenue growth is strong, suggesting future potential for EPS growth. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has PLS Plantations Berhad Been A Good Investment?

With a total shareholder return of 26% over three years, PLS Plantations Berhad shareholders would, in general, be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

To Conclude...

PLS Plantations Berhad pays its CEO a majority of compensation through a salary. As we touched on above, PLS Plantations Berhad is currently paying a compensation that's close to the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. But revenue growth over the last year can't be ignored. Shareholder returns, in comparison, have not been as impressive during the same period. EPS growth is a further sore spot — the metric is negative over the last three years. There's certainly room for improvement, but CEO compensation seems reasonable, considering the company's steady performance.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. That's why we did our research, and identified 3 warning signs for PLS Plantations Berhad (of which 1 shouldn't be ignored!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from PLS Plantations 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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