It Looks Like ATA IMS Berhad's (KLSE:ATAIMS) CEO May Expect Their Salary To Be Put Under The Microscope

Key Insights

• ATA IMS Berhad will host its Annual General Meeting on 29th of August
• Total pay for CEO Chiu-Wan Fong includes RM1.54m salary
• Total compensation is 400% above industry average
• ATA IMS Berhad's three-year loss to shareholders was 86% while its EPS was down 96% over the past three years

Shareholders will probably not be too impressed with the underwhelming results at ATA IMS Berhad (KLSE:ATAIMS) recently. At the upcoming AGM on 29th of August, shareholders can hear from the board including their plans for turning around performance. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.

View our latest analysis for ATA IMS Berhad

How Does Total Compensation For Chiu-Wan Fong Compare With Other Companies In The Industry?

According to our data, ATA IMS Berhad has a market capitalization of RM463m, and paid its CEO total annual compensation worth RM1.7m over the year to March 2024. That's a notable increase of 17% on last year. Notably, the salary which is RM1.54m, represents most of the total compensation being paid.

For comparison, other companies in the Malaysian Electronic industry with market capitalizations below RM876m, reported a median total CEO compensation of RM344k. Accordingly, our analysis reveals that ATA IMS Berhad pays Chiu-Wan Fong north of the industry median. Furthermore, Chiu-Wan Fong directly owns RM122m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	RM1.5m	RM1.3m	89%
Other	RM186k	RM157k	11%
Total Compensation	RM1.7m	RM1.5m	100%

Speaking on an industry level, nearly 77% of total compensation represents salary, while the remainder of 23% is other remuneration. ATA IMS Berhad pays out 89% of remuneration in the form of a salary, significantly higher than the industry average. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

ATA IMS Berhad's Growth

Over the last three years, ATA IMS Berhad has shrunk its earnings per share by 96% per year. It saw its revenue drop 56% 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. So given this relatively weak performance, shareholders would probably not want to see high compensation 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 ATA IMS Berhad Been A Good Investment?

Few ATA IMS Berhad shareholders would feel satisfied with the return of -86% over three years. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. 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.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 2 warning signs for ATA IMS Berhad that investors should think about before committing capital to this 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.