A Quick Analysis On Taiwan Glass Ind's (TPE:1802) CEO Salary

Por-Shih Lin is the CEO of Taiwan Glass Ind. Corp. (TPE:1802), and in this article, we analyze the executive's compensation package with respect to the overall performance of the company. This analysis will also assess whether Taiwan Glass Ind pays its CEO appropriately, considering recent earnings growth and total shareholder returns.

Check out our latest analysis for Taiwan Glass Ind

Comparing Taiwan Glass Ind. Corp.'s CEO Compensation With the industry

At the time of writing, our data shows that Taiwan Glass Ind. Corp. has a market capitalization of NT$45b, and reported total annual CEO compensation of NT$5.9m for the year to December 2019. That's a notable decrease of 25% on last year. In particular, the salary of NT$3.91m, makes up a huge portion of the total compensation being paid to the CEO.

On examining similar-sized companies in the industry with market capitalizations between NT$29b and NT$91b, we discovered that the median CEO total compensation of that group was NT$48m. Accordingly, Taiwan Glass Ind pays its CEO under the industry median. Moreover, Por-Shih Lin also holds NT$258m worth of Taiwan Glass Ind stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Talking in terms of the industry, salary represented approximately 93% of total compensation out of all the companies we analyzed, while other remuneration made up 7.1% of the pie. In Taiwan Glass Ind's case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. 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.

A Look at Taiwan Glass Ind. Corp.'s Growth Numbers

Over the last three years, Taiwan Glass Ind. Corp. has shrunk its earnings per share by 35% per year. Its revenue is down 3.8% over the previous year.

The decline in EPS is a bit concerning. And the fact that revenue is down year on year arguably paints an ugly picture. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Taiwan Glass Ind. Corp. Been A Good Investment?

With a three year total loss of 1.3% for the shareholders, Taiwan Glass Ind. Corp. would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

As we touched on above, Taiwan Glass Ind. Corp. is currently paying its CEO below the median pay for CEOs of companies belonging to the same industry and with similar market capitalizations. EPS growth has failed to impress us, and the same can be said about shareholder returns. It's tough to say that Por-Shih is earning a very high compensation, but shareholders will likely want to see healthier investor returns before agreeing that a raise is in order.

CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 2 warning signs for Taiwan Glass Ind (of which 1 is a bit concerning!) that you should know about in order to have a holistic understanding of the stock.

Important note: Taiwan Glass Ind is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.

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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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