Key Insights

• Hebei Construction Group will host its Annual General Meeting on 24th of June
• Total pay for CEO Jinfeng Shang includes CN¥175.0k salary
• Total compensation is 57% below industry average
• Over the past three years, Hebei Construction Group's EPS fell by 39% and over the past three years, the total loss to shareholders 76%

The underwhelming performance at Hebei Construction Group Corporation Limited (HKG:1727) recently has probably not pleased shareholders. At the upcoming AGM on 24th of June, shareholders may have the opportunity to influence management to turn the performance around by voting on resolutions such as executive remuneration and other matters. The data we gathered below shows that CEO compensation looks acceptable for now.

Comparing Hebei Construction Group Corporation Limited's CEO Compensation With The Industry

Our data indicates that Hebei Construction Group Corporation Limited has a market capitalization of HK$1.0b, and total annual CEO compensation was reported as CN¥860k for the year to December 2023. We note that's a decrease of 11% compared to last year. While we always look at total compensation first, our analysis shows that the salary component is less, at CN¥175k.

In comparison with other companies in the Hong Kong Construction industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was CN¥2.0m. That is to say, Jinfeng Shang is paid under the industry median.

Speaking on an industry level, nearly 83% of total compensation represents salary, while the remainder of 17% is other remuneration. Hebei Construction Group pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Hebei Construction Group Corporation Limited's Growth

Over the last three years, Hebei Construction Group Corporation Limited has shrunk its earnings per share by 39% per year. It saw its revenue drop 16% over the last year.

Few shareholders would be pleased to read that EPS have declined. And the impression is worse when you consider revenue is down year-on-year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has Hebei Construction Group Corporation Limited Been A Good Investment?

The return of -76% over three years would not have pleased Hebei Construction Group Corporation Limited shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO 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.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We identified 3 warning signs for Hebei Construction Group (2 shouldn't be ignored!) that you should be aware of before investing here.

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.

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