Here's Why Shareholders Should Examine Man Yue Technology Holdings Limited's (HKG:894) CEO Compensation Package More Closely

Key Insights

• Man Yue Technology Holdings will host its Annual General Meeting on 5th of June
• CEO Eugene Chan's total compensation includes salary of HK$4.95m
• Total compensation is 166% above industry average
• Over the past three years, Man Yue Technology Holdings' EPS fell by 45% and over the past three years, the total loss to shareholders 41%

The results at Man Yue Technology Holdings Limited (HKG:894) have been quite disappointing recently and CEO Eugene Chan bears some responsibility for this. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 5th of June. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. We present the case why we think CEO compensation is out of sync with company performance.

Check out our latest analysis for Man Yue Technology Holdings

Comparing Man Yue Technology Holdings Limited's CEO Compensation With The Industry

Our data indicates that Man Yue Technology Holdings Limited has a market capitalization of HK$219m, and total annual CEO compensation was reported as HK$6.3m for the year to December 2023. That is, the compensation was roughly the same as last year. Notably, the salary which is HK$4.95m, represents most of the total compensation being paid.

In comparison with other companies in the Hong Kong Electronic industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$2.4m. Accordingly, our analysis reveals that Man Yue Technology Holdings Limited pays Eugene Chan north of the industry median. Moreover, Eugene Chan also holds HK$2.1m worth of Man Yue Technology Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.

Component	2023	2022	Proportion (2023)
Salary	HK$5.0m	HK$5.0m	78%
Other	HK$1.4m	HK$1.3m	22%
Total Compensation	HK$6.3m	HK$6.3m	100%

On an industry level, around 79% of total compensation represents salary and 21% is other remuneration. There isn't a significant difference between Man Yue Technology Holdings and the broader market, in terms of salary allocation in the overall compensation package. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Man Yue Technology Holdings Limited's Growth Numbers

Over the last three years, Man Yue Technology Holdings Limited has shrunk its earnings per share by 45% per year. Its revenue is down 20% over the previous year.

The decline in EPS is a bit concerning. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Man Yue Technology Holdings Limited Been A Good Investment?

The return of -41% over three years would not have pleased Man Yue Technology Holdings Limited shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We did our research and identified 5 warning signs (and 2 which are a bit concerning) in Man Yue Technology Holdings we think you should know about.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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

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.