Does Mieco Chipboard Berhad's (KLSE:MIECO) CEO Salary Compare Well With Industry Peers?

Ah Ng became the CEO of Mieco Chipboard Berhad (KLSE:MIECO) in 2016, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Mieco Chipboard Berhad.

See our latest analysis for Mieco Chipboard Berhad

How Does Total Compensation For Ah Ng Compare With Other Companies In The Industry?

At the time of writing, our data shows that Mieco Chipboard Berhad has a market capitalization of RM436m, and reported total annual CEO compensation of RM2.8m for the year to December 2019. We note that's a small decrease of 4.0% on last year. Notably, the salary of RM2.8m is the entirety of the CEO compensation.

On comparing similar-sized companies in the industry with market capitalizations below RM812m, we found that the median total CEO compensation was RM526k. Accordingly, our analysis reveals that Mieco Chipboard Berhad pays Ah Ng north of the industry median. Moreover, Ah Ng also holds RM264m worth of Mieco Chipboard Berhad stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Speaking on an industry level, nearly 89% of total compensation represents salary, while the remainder of 11% is other remuneration. Speaking on a company level, Mieco Chipboard Berhad prefers to tread along a traditional path, disbursing all compensation through a salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Mieco Chipboard Berhad's Growth Numbers

Over the last three years, Mieco Chipboard Berhad has shrunk its earnings per share by 83% per year. Its revenue is down 13% over the previous year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Mieco Chipboard Berhad Been A Good Investment?

Mieco Chipboard Berhad has served shareholders reasonably well, with a total return of 15% over three years. 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...

Mieco Chipboard Berhad pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. As we noted earlier, Mieco Chipboard Berhad pays its CEO higher than the norm for similar-sized companies belonging to the same industry. This doesn't look great when you realize that the company has been suffering from negative EPS growth for the last three years. And shareholder returns are decent but not great. So you may want to delve deeper, because we don't think the amount Ah makes is justifiable.

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 Mieco Chipboard Berhad you should be aware of, and 1 of them is concerning.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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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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