We Think Shareholders May Want To Consider A Review Of ASTEEL Group Berhad's (KLSE:ASTEEL) CEO Compensation Package

Key Insights

• ASTEEL Group Berhad to hold its Annual General Meeting on 26th of June
• Salary of RM584.0k is part of CEO Victor Hii's total remuneration
• Total compensation is similar to the industry average
• Over the past three years, ASTEEL Group Berhad's EPS fell by 37% and over the past three years, the total loss to shareholders 42%

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The results at ASTEEL Group Berhad (KLSE:ASTEEL) have been quite disappointing recently and CEO Victor Hii bears some responsibility for this. At the upcoming AGM on 26th of June, 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 ASTEEL Group Berhad

How Does Total Compensation For Victor Hii Compare With Other Companies In The Industry?

At the time of writing, our data shows that ASTEEL Group Berhad has a market capitalization of RM34m, and reported total annual CEO compensation of RM821k for the year to December 2024. Notably, that's a decrease of 18% over the year before. We note that the salary portion, which stands at RM584.0k constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the Malaysian Metals and Mining industry with market capitalizations below RM853m, reported a median total CEO compensation of RM840k. This suggests that ASTEEL Group Berhad remunerates its CEO largely in line with the industry average. Furthermore, Victor Hii directly owns RM945k 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 77% of total compensation out of all the companies we analyzed, while other remuneration made up 23% of the pie. There isn't a significant difference between ASTEEL Group Berhad and the broader market, in terms of salary allocation in the overall compensation package. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at ASTEEL Group Berhad's Growth Numbers

Over the last three years, ASTEEL Group Berhad has shrunk its earnings per share by 37% per year. Its revenue is down 1.7% 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. 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 ASTEEL Group Berhad Been A Good Investment?

The return of -42% over three years would not have pleased ASTEEL Group Berhad shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

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, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 3 warning signs for ASTEEL Group Berhad that investors should think about before committing capital to this stock.

Important note: ASTEEL Group Berhad is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.