Here's Why It's Unlikely That Prestar Resources Berhad's (KLSE:PRESTAR) CEO Will See A Pay Rise This Year

Key Insights

• Prestar Resources Berhad to hold its Annual General Meeting on 18th of June
• Salary of RM961.0k is part of CEO Yew Peng Toh's total remuneration
• Total compensation is 75% above industry average
• Prestar Resources Berhad's EPS declined by 56% over the past three years while total shareholder loss over the past three years was 22%

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Shareholders will probably not be too impressed with the underwhelming results at Prestar Resources Berhad (KLSE:PRESTAR) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 18th of June. 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 Prestar Resources Berhad

Comparing Prestar Resources Berhad's CEO Compensation With The Industry

At the time of writing, our data shows that Prestar Resources Berhad has a market capitalization of RM122m, and reported total annual CEO compensation of RM1.5m for the year to December 2024. We note that's an increase of 9.6% above last year. We note that the salary portion, which stands at RM961.0k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the Malaysian Metals and Mining industry with market capitalizations under RM847m, the reported median total CEO compensation was RM838k. This suggests that Yew Peng Toh is paid more than the median for the industry. Moreover, Yew Peng Toh also holds RM8.3m worth of Prestar Resources Berhad stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

On an industry level, around 77% of total compensation represents salary and 23% is other remuneration. Prestar Resources Berhad pays a modest slice of remuneration through salary, as compared to the broader industry. 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.

A Look at Prestar Resources Berhad's Growth Numbers

Over the last three years, Prestar Resources Berhad has shrunk its earnings per share by 56% per year. It saw its revenue drop 12% over the last 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 Prestar Resources Berhad Been A Good Investment?

With a three year total loss of 22% for the shareholders, Prestar Resources Berhad would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. 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.

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 5 warning signs for Prestar Resources Berhad (of which 1 can't be ignored!) that you should know about in order to have a holistic understanding of the stock.

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. 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.