Genetec Technology Berhad's (KLSE:GENETEC) CEO Will Probably Have Their Compensation Approved By Shareholders

Key Insights

• Genetec Technology Berhad to hold its Annual General Meeting on 29th of September
• Salary of RM829.2k is part of CEO Kem Chin's total remuneration
• Total compensation is similar to the industry average
• Genetec Technology Berhad's EPS grew by 86% over the past three years while total shareholder return over the past three years was 1,871%

We have been pretty impressed with the performance at Genetec Technology Berhad (KLSE:GENETEC) recently and CEO Kem Chin deserves a mention for their role in it. Coming up to the next AGM on 29th of September, shareholders would be keeping this in mind. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and cast their votes on resolutions such as executive remuneration and other matters. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

Check out our latest analysis for Genetec Technology Berhad

How Does Total Compensation For Kem Chin Compare With Other Companies In The Industry?

According to our data, Genetec Technology Berhad has a market capitalization of RM1.8b, and paid its CEO total annual compensation worth RM965k over the year to March 2023. That's mostly flat as compared to the prior year's compensation. In particular, the salary of RM829.2k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Malaysian Semiconductor industry with market capitalizations ranging from RM936m to RM3.7b, the reported median CEO total compensation was RM962k. From this we gather that Kem Chin is paid around the median for CEOs in the industry. What's more, Kem Chin holds RM125m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Component	2023	2022	Proportion (2023)
Salary	RM829k	RM827k	86%
Other	RM136k	RM125k	14%
Total Compensation	RM965k	RM952k	100%

Speaking on an industry level, nearly 80% of total compensation represents salary, while the remainder of 20% is other remuneration. Our data reveals that Genetec Technology Berhad allocates salary more or less in line with the wider market. 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.

Genetec Technology Berhad's Growth

Genetec Technology Berhad has seen its earnings per share (EPS) increase by 86% a year over the past three years. It achieved revenue growth of 16% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Genetec Technology Berhad Been A Good Investment?

We think that the total shareholder return of 1,871%, over three years, would leave most Genetec Technology Berhad shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

To Conclude...

Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. We've identified 1 warning sign for Genetec Technology Berhad that investors should be aware of in a dynamic business environment.

Important note: Genetec Technology 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.