Key Insights

• PanAsialum Holdings to hold its Annual General Meeting on 31st of May
• Total pay for CEO Zhaolong Pan includes HK$2.15m salary
• The overall pay is comparable to the industry average
• PanAsialum Holdings' three-year loss to shareholders was 69% while its EPS was down 69% over the past three years

The results at PanAsialum Holdings Company Limited (HKG:2078) have been quite disappointing recently and CEO Zhaolong Pan bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 31st of May. 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. The data we present below explains why we think CEO compensation is not consistent with recent performance.

How Does Total Compensation For Zhaolong Pan Compare With Other Companies In The Industry?

Our data indicates that PanAsialum Holdings Company Limited has a market capitalization of HK$108m, and total annual CEO compensation was reported as HK$2.3m for the year to December 2023. That's just a smallish increase of 6.2% on last year. In particular, the salary of HK$2.15m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the Hong Kong Electronic industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$2.4m. So it looks like PanAsialum Holdings compensates Zhaolong Pan in line with the median for the industry.

On an industry level, around 79% of total compensation represents salary and 21% is other remuneration. PanAsialum Holdings pays out 94% of remuneration in the form of a salary, significantly higher than the industry average. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

PanAsialum Holdings Company Limited's Growth

PanAsialum Holdings Company Limited has reduced its earnings per share by 69% a year over the last three years. In the last year, its revenue is down 36%.

Few shareholders would be pleased to read that EPS have declined. And the fact that revenue is down year on year arguably paints an ugly picture. These factors suggest that the business performance wouldn't really justify a high pay packet 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 PanAsialum Holdings Company Limited Been A Good Investment?

Few PanAsialum Holdings Company Limited shareholders would feel satisfied with the return of -69% over three years. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. 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. That's why we did our research, and identified 3 warning signs for PanAsialum Holdings (of which 1 is significant!) that you should know about in order to have a holistic understanding of the stock.

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.

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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.