Shareholders May Not Be So Generous With OCK Group Berhad's (KLSE:OCK) CEO Compensation And Here's Why

Key Insights

• OCK Group Berhad to hold its Annual General Meeting on 5th of June
• CEO Hock Low's total compensation includes salary of RM828.0k
• The total compensation is 419% higher than the average for the industry
• OCK Group Berhad's EPS grew by 6.8% over the past three years while total shareholder return over the past three years was 33%

CEO Hock Low has done a decent job of delivering relatively good performance at OCK Group Berhad (KLSE:OCK) recently. As shareholders go into the upcoming AGM on 5th of June, CEO compensation will probably not be their focus, but rather the steps management will take to continue the growth momentum. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

View our latest analysis for OCK Group Berhad

How Does Total Compensation For Hock Low Compare With Other Companies In The Industry?

According to our data, OCK Group Berhad has a market capitalization of RM664m, and paid its CEO total annual compensation worth RM1.1m over the year to December 2023. That's a modest increase of 5.8% on the prior year. In particular, the salary of RM828.0k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Malaysia Telecom industry with market capitalizations under RM941m, the reported median total CEO compensation was RM204k. Accordingly, our analysis reveals that OCK Group Berhad pays Hock Low north of the industry median. Moreover, Hock Low also holds RM7.2m worth of OCK Group Berhad stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	RM828k	RM787k	78%
Other	RM233k	RM216k	22%
Total Compensation	RM1.1m	RM1.0m	100%

On an industry level, roughly 58% of total compensation represents salary and 42% is other remuneration. OCK Group Berhad pays out 78% of remuneration in the form of a salary, significantly higher than the industry average. 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.

OCK Group Berhad's Growth

Over the past three years, OCK Group Berhad has seen its earnings per share (EPS) grow by 6.8% per year. It achieved revenue growth of 17% over the last year.

We think the revenue growth is good. And the improvement in EPSis modest but respectable. So while we'd stop just short of calling this a top performer, but we think it is well worth watching. 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 OCK Group Berhad Been A Good Investment?

OCK Group Berhad has generated a total shareholder return of 33% over three years, so most shareholders would be reasonably content. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.

In Summary...

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, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.

CEO compensation can have a massive impact on performance, but it's just one element. We did our research and spotted 1 warning sign for OCK Group Berhad that investors should look into moving forward.

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.