Shareholders May Be More Conservative With V.S. Industry Berhad's (KLSE:VS) CEO Compensation For Now

CEO Sem Yam Gan has done a decent job of delivering relatively good performance at V.S. Industry Berhad (KLSE:VS) recently. As shareholders go into the upcoming AGM on 07 January 2022, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders will still be cautious of paying the CEO excessively.

See our latest analysis for V.S. Industry Berhad

How Does Total Compensation For Sem Yam Gan Compare With Other Companies In The Industry?

At the time of writing, our data shows that V.S. Industry Berhad has a market capitalization of RM5.2b, and reported total annual CEO compensation of RM2.2m for the year to July 2021. That's a notable increase of 57% on last year. We note that the salary of RM1.26m makes up a sizeable portion of the total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations ranging from RM4.2b to RM13b, the reported median CEO total compensation was RM1.3m. This suggests that Sem Yam Gan is paid more than the median for the industry. Moreover, Sem Yam Gan also holds RM266m worth of V.S. Industry Berhad stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2021	2020	Proportion (2021)
Salary	RM1.3m	RM931k	58%
Other	RM908k	RM451k	42%
Total Compensation	RM2.2m	RM1.4m	100%

Talking in terms of the industry, salary represented approximately 74% of total compensation out of all the companies we analyzed, while other remuneration made up 26% of the pie. It's interesting to note that V.S. Industry Berhad allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

V.S. Industry Berhad's Growth

Over the past three years, V.S. Industry Berhad has seen its earnings per share (EPS) grow by 8.4% per year. Its revenue is up 25% over the last year.

We think the revenue growth is good. And the modest growth in EPS isn't bad, either. Although we'll stop short of calling the stock a top performer, we think the company has potential. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.

Has V.S. Industry Berhad Been A Good Investment?

Most shareholders would probably be pleased with V.S. Industry Berhad for providing a total return of 302% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

To Conclude...

The company's decent performance might have made most shareholders happy, possibly making CEO remuneration the least of the concerns to be discussed in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 2 warning signs for V.S. Industry Berhad (1 is a bit concerning!) that you should be aware of before investing here.

Switching gears from V.S. Industry Berhad, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.