Key Insights

• Y. T. Realty Group's Annual General Meeting to take place on 31st of May
• Salary of HK$2.99m is part of CEO Hy Sky Wong's total remuneration
• Total compensation is 65% above industry average
• Y. T. Realty Group's EPS declined by 31% over the past three years while total shareholder loss over the past three years was 83%

Shareholders of Y. T. Realty Group Limited (HKG:75) will have been dismayed by the negative share price return over the last three years. In addition, the company's per-share earnings growth is not looking good, despite growing revenues. In light of this performance, shareholders will have a chance to question the board in the upcoming AGM on 31st of May, where they can impact on future company performance by voting on resolutions, including executive compensation. Here's why we think shareholders should hold off on a raise for the CEO at the moment.

Comparing Y. T. Realty Group Limited's CEO Compensation With The Industry

According to our data, Y. T. Realty Group Limited has a market capitalization of HK$240m, and paid its CEO total annual compensation worth HK$3.0m over the year to December 2023. This was the same amount the CEO received in the prior year. In particular, the salary of HK$2.99m, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Hong Kong Real Estate industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$1.8m. Accordingly, our analysis reveals that Y. T. Realty Group Limited pays Hy Sky Wong north of the industry median. What's more, Hy Sky Wong holds HK$50m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

On an industry level, around 77% of total compensation represents salary and 23% is other remuneration. Investors will find it interesting that Y. T. Realty Group pays the bulk of its rewards through a traditional salary, instead of non-salary benefits. 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 Y. T. Realty Group Limited's Growth Numbers

Over the last three years, Y. T. Realty Group Limited has shrunk its earnings per share by 31% per year. It achieved revenue growth of 169% over the last year.

The reduction in EPS, over three years, is arguably concerning. On the other hand, the strong revenue growth suggests the business is growing. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Y. T. Realty Group Limited Been A Good Investment?

The return of -83% over three years would not have pleased Y. T. Realty Group Limited shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Y. T. Realty Group pays its CEO a majority of compensation through a salary. The company's earnings haven't grown and possibly because of that, the stock has performed poorly, resulting in a loss for the company's shareholders. The upcoming AGM will provide shareholders the opportunity to revisit the company's remuneration policies and evaluate if the board's judgement and decision-making is aligned with that of the company's shareholders.

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 4 warning signs (and 3 which are a bit unpleasant) in Y. T. Realty Group we think you should know about.

Important note: Y. T. Realty Group 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. 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.