Increases to CEO Compensation Might Be Put On Hold For Now at Singapore Post Limited (SGX:S08)

Key Insights

• Singapore Post to hold its Annual General Meeting on 24th of July
• Total pay for CEO Vincent Phang includes S$850.0k salary
• The total compensation is 196% higher than the average for the industry
• Singapore Post's three-year loss to shareholders was 33% while its EPS grew by 27% over the past three years

Shareholders of Singapore Post Limited (SGX:S08) will have been dismayed by the negative share price return over the last three years. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. Shareholders may want to question the board on the future direction of the company at the upcoming AGM on 24th of July. They could also influence management through voting on resolutions such as executive remuneration. We discuss below why we think shareholders should be cautious of approving a raise for the CEO at the moment.

See our latest analysis for Singapore Post

Comparing Singapore Post Limited's CEO Compensation With The Industry

According to our data, Singapore Post Limited has a market capitalization of S$1.0b, and paid its CEO total annual compensation worth S$1.7m over the year to March 2024. That's a notable decrease of 25% on last year. In particular, the salary of S$850.0k, makes up a fairly large portion of the total compensation being paid to the CEO.

For comparison, other companies in the Singapore Logistics industry with market capitalizations ranging between S$536m and S$2.1b had a median total CEO compensation of S$573k. Hence, we can conclude that Vincent Phang is remunerated higher than the industry median.

Component	2024	2023	Proportion (2024)
Salary	S$850k	S$850k	50%
Other	S$847k	S$1.4m	50%
Total Compensation	S$1.7m	S$2.3m	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 Singapore Post 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.

Singapore Post Limited's Growth

Singapore Post Limited's earnings per share (EPS) grew 27% per year over the last three years. It saw its revenue drop 9.9% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's always a tough situation when revenues are not growing, but ultimately profits are more important. 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 Singapore Post Limited Been A Good Investment?

Few Singapore Post Limited shareholders would feel satisfied with the return of -33% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. The fact that the stock price hasn't grown along with earnings may indicate that other issues may be affecting that stock. Shareholders would be keen to know what's holding the stock back when earnings have grown. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. That's why we did some digging and identified 1 warning sign for Singapore Post that investors should think about before committing capital to this stock.

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.

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