How Much Did Second Chance Properties' (SGX:528) CEO Pocket Last Year?

Mohamed Salleh Marican became the CEO of Second Chance Properties Ltd (SGX:528) in 1975, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also evaluate the appropriateness of CEO compensation when taking into account the earnings and shareholder returns of the company.

See our latest analysis for Second Chance Properties

How Does Total Compensation For Mohamed Salleh Marican Compare With Other Companies In The Industry?

According to our data, Second Chance Properties Ltd has a market capitalization of S$181m, and paid its CEO total annual compensation worth S$560k over the year to August 2020. That's a notable decrease of 11% on last year. We think total compensation is more important but our data shows that the CEO salary is lower, at S$173k.

On comparing similar-sized companies in the industry with market capitalizations below S$265m, we found that the median total CEO compensation was S$266k. Hence, we can conclude that Mohamed Salleh Marican is remunerated higher than the industry median. Furthermore, Mohamed Salleh Marican directly owns S$126m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 92% of total compensation represents salary and 8.3% is other remuneration. In Second Chance Properties' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.

A Look at Second Chance Properties Ltd's Growth Numbers

Over the last three years, Second Chance Properties Ltd has shrunk its earnings per share by 22% per year. Its revenue is down 22% over the previous year.

Overall this is not a very positive result for shareholders. 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 Second Chance Properties Ltd Been A Good Investment?

Second Chance Properties Ltd has generated a total shareholder return of 3.5% over three years, so most shareholders wouldn't be too disappointed. But they probably don't want to see the CEO paid more than is normal for companies around the same size.

In Summary...

As we noted earlier, Second Chance Properties pays its CEO higher than the norm for similar-sized companies belonging to the same industry. This doesn't look great when you realize that the company has been suffering from negative EPS growth for the last three years. And shareholder returns are decent but not great. So we think more research is needed, but we don't think the CEO is underpaid.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. In our study, we found 3 warning signs for Second Chance Properties you should be aware of, and 1 of them is a bit concerning.

Switching gears from Second Chance Properties, 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.

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This article by Simply Wall St is general in nature. 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.
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