Is Singapore Technologies Engineering Ltd (SGX:S63) Overpaying Its CEO?

Vincent Chong became the CEO of Singapore Technologies Engineering Ltd (SGX:S63) in 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.

View our latest analysis for Singapore Technologies Engineering

How Does Vincent Chong's Compensation Compare With Similar Sized Companies?

Our data indicates that Singapore Technologies Engineering Ltd is worth S$13b, and total annual CEO compensation is S$4.6m. (This number is for the twelve months until December 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at S$973k. We looked at a group of companies with market capitalizations over S$11b and the median CEO total compensation was S$5.5m. There aren't very many mega-cap companies, so we had to take a wide range to get a meaningful comparison figure.

So Vincent Chong is paid around the average of the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

You can see a visual representation of the CEO compensation at Singapore Technologies Engineering, below.

Is Singapore Technologies Engineering Ltd Growing?

Singapore Technologies Engineering Ltd has increased its earnings per share (EPS) by an average of 2.3% a year, over the last three years (using a line of best fit). Its revenue is up 1.9% over last year.

I'm not particularly impressed by the revenue growth, but it is good to see modest EPS growth. Considering these factors I'd say performance has been pretty decent, though not amazing.

Has Singapore Technologies Engineering Ltd Been A Good Investment?

Most shareholders would probably be pleased with Singapore Technologies Engineering Ltd for providing a total return of 48% over three years. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Remuneration for Vincent Chong is close enough to the median pay for a CEO of a large company .

The company isn't showing particularly great growth, but shareholder returns have been pleasing. So considering most shareholders would be happy, we'd say the CEO pay is appropriate. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Singapore Technologies Engineering.

If you want to buy a stock that is better than Singapore Technologies Engineering, this free list of high return, low debt companies is a great place to look.

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