Key Insights

• Noble Engineering Group Holdings to hold its Annual General Meeting on 30th of September
• Salary of HK$600.0k is part of CEO CK Tse's total remuneration
• The total compensation is 74% less than the average for the industry
• Noble Engineering Group Holdings' three-year loss to shareholders was 46% while its EPS grew by 17% over the past three years

Shareholders may be wondering what CEO CK Tse plans to do to improve the less than great performance at Noble Engineering Group Holdings Limited (HKG:8445) recently. One way they can exercise their influence on management is through voting on resolutions, such as executive remuneration at the next AGM, coming up on 30th of September. Voting on executive pay could be a powerful way to influence management, as studies have shown that the right compensation incentives impact company performance. We have prepared some analysis below to show that CEO compensation looks to be reasonable.

Comparing Noble Engineering Group Holdings Limited's CEO Compensation With The Industry

Our data indicates that Noble Engineering Group Holdings Limited has a market capitalization of HK$54m, and total annual CEO compensation was reported as HK$600k for the year to March 2024. There was no change in the compensation compared to last year. It is worth noting that the CEO compensation consists entirely of the salary, worth HK$600k.

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 HK$2.3m. That is to say, CK Tse is paid under the industry median.

On an industry level, around 84% of total compensation represents salary and 16% is other remuneration. At the company level, Noble Engineering Group Holdings pays CK Tse solely through a salary, preferring to go down a conventional route. 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 Noble Engineering Group Holdings Limited's Growth Numbers

Noble Engineering Group Holdings Limited has seen its earnings per share (EPS) increase by 17% a year over the past three years. In the last year, its revenue is up 35%.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. Most shareholders would be pleased to see strong revenue growth combined with EPS growth. This combo suggests a fast growing business. 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 Noble Engineering Group Holdings Limited Been A Good Investment?

With a total shareholder return of -46% over three years, Noble Engineering Group Holdings Limited shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Noble Engineering Group Holdings pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. The fact that shareholders are sitting on a loss is certainly disheartening. This contrasts to the strong EPS growth recently however, and suggests that there may be other factors at play driving down the share price. A key question may be why the fundamentals have not yet been reflected into the share price. The upcoming AGM will provide shareholders the opportunity to raise their concerns and evaluate if the board's judgement and decision-making is aligned with their expectations.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We've identified 2 warning signs for Noble Engineering Group Holdings that investors should be aware of in a dynamic business environment.

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.