We Discuss Why Frasers Property Limited's (SGX:TQ5) CEO Compensation May Be Closely Reviewed

Key Insights

• Frasers Property will host its Annual General Meeting on 16th of January
• Total pay for CEO Panote Sirivadhanabhakdi includes S$996.0k salary
• Total compensation is 312% above industry average
• Frasers Property's three-year loss to shareholders was 9.0% while its EPS was down 43% over the past three years

Frasers Property Limited (SGX:TQ5) has not performed well recently and CEO Panote Sirivadhanabhakdi will probably need to up their game. At the upcoming AGM on 16th of January, 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. The data we present below explains why we think CEO compensation is not consistent with recent performance.

Check out our latest analysis for Frasers Property

How Does Total Compensation For Panote Sirivadhanabhakdi Compare With Other Companies In The Industry?

At the time of writing, our data shows that Frasers Property Limited has a market capitalization of S$3.7b, and reported total annual CEO compensation of S$3.1m for the year to September 2024. That's slightly lower by 4.8% over the previous year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at S$996k.

On examining similar-sized companies in the Singaporean Real Estate industry with market capitalizations between S$2.7b and S$8.8b, we discovered that the median CEO total compensation of that group was S$758k. Accordingly, our analysis reveals that Frasers Property Limited pays Panote Sirivadhanabhakdi north of the industry median.

Component	2024	2023	Proportion (2024)
Salary	S$996k	S$996k	32%
Other	S$2.1m	S$2.3m	68%
Total Compensation	S$3.1m	S$3.3m	100%

On an industry level, roughly 60% of total compensation represents salary and 40% is other remuneration. It's interesting to note that Frasers Property allocates a smaller portion of compensation to salary in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Frasers Property Limited's Growth

Over the last three years, Frasers Property Limited has shrunk its earnings per share by 43% per year. In the last year, its revenue is up 6.8%.

Overall this is not a very positive result for shareholders. And the modest revenue growth over 12 months isn't much comfort against the reduced EPS. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Frasers Property Limited Been A Good Investment?

Given the total shareholder loss of 9.0% over three years, many shareholders in Frasers Property Limited are probably rather dissatisfied, to say the least. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a 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.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. In our study, we found 2 warning signs for Frasers Property you should be aware of, and 1 of them can't be ignored.

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.