How Much Did Sunway Real Estate Investment Trust's (KLSE:SUNREIT) CEO Pocket Last Year?

This article will reflect on the compensation paid to Jeffrey Ng who has served as CEO of Sunway Real Estate Investment Trust (KLSE:SUNREIT) since 2010. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for Sunway Real Estate Investment Trust.

Note: The company does not report funds from operations, and as a result, we have used earnings per share in our analysis.

Check out our latest analysis for Sunway Real Estate Investment Trust

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

Our data indicates that Sunway Real Estate Investment Trust has a market capitalization of RM4.9b, and total annual CEO compensation was reported as RM1.2m for the year to June 2020. We note that's a decrease of 39% compared to last year. In particular, the salary of RM875.0k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar companies from the same industry with market caps ranging from RM4.0b to RM13b, we found that the median CEO total compensation was RM8.6m. This suggests that Jeffrey Ng is paid below the industry median.

Component	2020	2019	Proportion (2020)
Salary	RM875k	RM875k	71%
Other	RM351k	RM1.1m	29%
Total Compensation	RM1.2m	RM2.0m	100%

Talking in terms of the industry, salary represented approximately 26% of total compensation out of all the companies we analyzed, while other remuneration made up 74% of the pie. It's interesting to note that Sunway Real Estate Investment Trust pays out a greater portion of remuneration through salary, compared to the industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Sunway Real Estate Investment Trust's Growth

Over the last three years, Sunway Real Estate Investment Trust has shrunk its earnings per share by 39% per year. Its revenue is down 28% over the previous year.

The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Sunway Real Estate Investment Trust Been A Good Investment?

With a three year total loss of 7.1% for the shareholders, Sunway Real Estate Investment Trust would certainly have some dissatisfied shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

As we touched on above, Sunway Real Estate Investment Trust is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. Over the last three years, shareholder returns have been downright disappointing, and EPSgrowth has been equally disappointing. It's tough to say that Jeffrey is earning a very high compensation, but shareholders will likely want to see healthier investor returns before agreeing that a raise is in order.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 5 warning signs for Sunway Real Estate Investment Trust (1 is potentially serious!) that you should be aware of before investing here.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity and low debt.

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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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