How Is Euro Tech Holdings' (NASDAQ:CLWT) CEO Paid Relative To Peers?

T. C. Leung became the CEO of Euro Tech Holdings Company Limited (NASDAQ:CLWT) in 1996, 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.

View our latest analysis for Euro Tech Holdings

How Does Total Compensation For T. C. Leung Compare With Other Companies In The Industry?

According to our data, Euro Tech Holdings Company Limited has a market capitalization of US$10m, and paid its CEO total annual compensation worth US$197k over the year to December 2019. That is, the compensation was roughly the same as last year. It is worth noting that the CEO compensation consists entirely of the salary, worth US$197k.

In comparison with other companies in the industry with market capitalizations under US$200m, the reported median total CEO compensation was US$458k. That is to say, T. C. Leung is paid under the industry median. Furthermore, T. C. Leung directly owns US$5.2m worth of shares in the company, implying that they are deeply invested in the company's success.

Speaking on an industry level, nearly 22% of total compensation represents salary, while the remainder of 78% is other remuneration. On a company level, Euro Tech Holdings prefers to reward its CEO through a salary, opting not to pay T. C. Leung through non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Euro Tech Holdings Company Limited's Growth

Over the last three years, Euro Tech Holdings Company Limited has shrunk its earnings per share by 66% per year. It saw its revenue drop 13% over the last year.

Overall this is not a very positive result for shareholders. And the impression is worse when you consider revenue is down year-on-year. 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 Euro Tech Holdings Company Limited Been A Good Investment?

Most shareholders would probably be pleased with Euro Tech Holdings Company Limited for providing a total return of 94% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.

To Conclude...

Euro Tech Holdings rewards its CEO solely through a salary, ignoring non-salary benefits completely. As previously discussed, T. C. is compensated less than what is normal for CEOs of companies of similar size, and which belong to the same industry. And while EPS growth is negative, shareholder returns have been healthy recently. So, while it would be nice to have better EPS growth, our analysis suggests CEO compensation is quite modest.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 3 warning signs for Euro Tech Holdings that you should be aware of before investing.

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. 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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