Key Things To Understand About Kia Lim Berhad's (KLSE:KIALIM) CEO Pay Cheque

This article will reflect on the compensation paid to Yeng Ng who has served as CEO of Kia Lim Berhad (KLSE:KIALIM) since 2007. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

View our latest analysis for Kia Lim Berhad

Comparing Kia Lim Berhad's CEO Compensation With the industry

Our data indicates that Kia Lim Berhad has a market capitalization of RM15m, and total annual CEO compensation was reported as RM413k for the year to December 2019. This means that the compensation hasn't changed much from last year. In particular, the salary of RM318.8k, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the industry with market capitalizations below RM810m, reported a median total CEO compensation of RM427k. So it looks like Kia Lim Berhad compensates Yeng Ng in line with the median for the industry. What's more, Yeng Ng holds RM394k 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 77% of total compensation out of all the companies we analyzed, while other remuneration made up 23% of the pie. Kia Lim Berhad is largely mirroring the industry average when it comes to the share a salary enjoys in overall compensation. 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.

Kia Lim Berhad's Growth

Kia Lim Berhad has seen its earnings per share (EPS) increase by 32% a year over the past three years. It saw its revenue drop 36% over the last year.

This demonstrates that the company has been improving recently and is good news for the shareholders. The lack of revenue growth isn't ideal, but it is the bottom line that counts most in business. 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 Kia Lim Berhad Been A Good Investment?

Given the total shareholder loss of 29% over three years, many shareholders in Kia Lim Berhad are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

As previously discussed, Yeng is compensated close to the median for companies of its size, and which belong to the same industry. Meanwhile, shareholder returns paint a sorry picture for the company, finishing in the red over the last three years. However, EPS growth is positive over the same time frame. Considering positive EPS growth, we'd say compensation is fair, but shareholders may be wary of a bump in pay before the company logs positive returns.

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 Kia Lim Berhad that investors should think about before committing capital to this stock.

Switching gears from Kia Lim 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.

If you’re looking to trade Kia Lim Berhad, open an account with the lowest-cost* platform trusted by professionals, Interactive Brokers. Their clients from over 200 countries and territories trade stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.