We Think Shareholders Are Less Likely To Approve A Pay Rise For M N C Wireless Berhad's (KLSE:MNC) CEO For Now

Key Insights

• M N C Wireless Berhad will host its Annual General Meeting on 29th of October
• Salary of RM216.0k is part of CEO Christopher Tan's total remuneration
• The total compensation is similar to the average for the industry
• M N C Wireless Berhad's three-year loss to shareholders was 75% while its EPS grew by 59% over the past three years

In the past three years, the share price of M N C Wireless Berhad (KLSE:MNC) has struggled to grow and now shareholders are sitting on a loss. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 29th of October. They could also influence management through voting on resolutions such as executive remuneration. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

See our latest analysis for M N C Wireless Berhad

Comparing M N C Wireless Berhad's CEO Compensation With The Industry

Our data indicates that M N C Wireless Berhad has a market capitalization of RM18m, and total annual CEO compensation was reported as RM286k for the year to April 2024. This means that the compensation hasn't changed much from last year. We note that the salary portion, which stands at RM216.0k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the Malaysia Software industry with market capitalizations under RM865m, the reported median total CEO compensation was RM298k. So it looks like M N C Wireless Berhad compensates Christopher Tan in line with the median for the industry. Furthermore, Christopher Tan directly owns RM1.0m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	RM216k	RM216k	75%
Other	RM70k	RM70k	25%
Total Compensation	RM286k	RM286k	100%

Talking in terms of the industry, salary represented approximately 79% of total compensation out of all the companies we analyzed, while other remuneration made up 21% of the pie. Our data reveals that M N C Wireless Berhad allocates salary more or less in line with the wider market. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at M N C Wireless Berhad's Growth Numbers

M N C Wireless Berhad's earnings per share (EPS) grew 59% per year over the last three years. In the last year, its revenue is up 17%.

Shareholders would be glad to know that the company has improved itself over the last few years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has M N C Wireless Berhad Been A Good Investment?

The return of -75% over three years would not have pleased M N C Wireless Berhad shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 3 warning signs (and 2 which shouldn't be ignored) in M N C Wireless Berhad we think you should know about.

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. 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.