Key Insights

• Cool Link (Holdings) will host its Annual General Meeting on 27th of June
• Salary of S$264.0k is part of CEO R Gay Gay's total remuneration
• The overall pay is 107% above the industry average
• Cool Link (Holdings)'s three-year loss to shareholders was 45% while its EPS was down 65% over the past three years

Shareholders will probably not be too impressed with the underwhelming results at Cool Link (Holdings) Limited (HKG:8491) recently. At the upcoming AGM on 27th of June, shareholders can hear from the board including their plans for turning around performance. 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. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Comparing Cool Link (Holdings) Limited's CEO Compensation With The Industry

According to our data, Cool Link (Holdings) Limited has a market capitalization of HK$175m, and paid its CEO total annual compensation worth S$746k over the year to December 2023. That's a notable decrease of 8.4% on last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at S$264k.

On comparing similar-sized companies in the Hong Kong Consumer Retailing industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was S$360k. Accordingly, our analysis reveals that Cool Link (Holdings) Limited pays R Gay Gay north of the industry median. What's more, R Gay Gay holds HK$5.8m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Talking in terms of the industry, salary represented approximately 73% of total compensation out of all the companies we analyzed, while other remuneration made up 27% of the pie. In Cool Link (Holdings)'s case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Cool Link (Holdings) Limited's Growth

Cool Link (Holdings) Limited has reduced its earnings per share by 65% a year over the last three years. In the last year, its revenue is down 11%.

The decline in EPS is a bit concerning. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 Cool Link (Holdings) Limited Been A Good Investment?

With a total shareholder return of -45% over three years, Cool Link (Holdings) Limited shareholders would by and large be disappointed. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

In Summary...

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, the board will get the chance to explain the steps it plans to take to improve business performance.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 4 warning signs for Cool Link (Holdings) (2 are potentially serious!) that you should be aware of before investing here.

Switching gears from Cool Link (Holdings), if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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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.

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