Key Insights

• Taste Gourmet Group to hold its Annual General Meeting on 1st of August
• Salary of HK$1.95m is part of CEO Wai Chun Chan's total remuneration
• The total compensation is similar to the average for the industry
• Taste Gourmet Group's total shareholder return over the past three years was 52% while its EPS grew by 54% over the past three years

It would be hard to discount the role that CEO Wai Chun Chan has played in delivering the impressive results at Taste Gourmet Group Limited (HKG:8371) recently. The pleasing results would be something shareholders would keep in mind at the upcoming AGM on 1st of August. This would also be a chance for them to hear the board review the financial results, discuss future company strategy and vote on any resolutions such as executive remuneration. In light of the great performance, we discuss the case why we think CEO compensation is not excessive.

How Does Total Compensation For Wai Chun Chan Compare With Other Companies In The Industry?

Our data indicates that Taste Gourmet Group Limited has a market capitalization of HK$531m, and total annual CEO compensation was reported as HK$2.0m for the year to March 2024. This means that the compensation hasn't changed much from last year. In particular, the salary of HK$1.95m, makes up a huge portion of the total compensation being paid to the CEO.

For comparison, other companies in the Hong Kong Hospitality industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$2.0m. This suggests that Taste Gourmet Group remunerates its CEO largely in line with the industry average.

Talking in terms of the industry, salary represented approximately 87% of total compensation out of all the companies we analyzed, while other remuneration made up 13% of the pie. Taste Gourmet Group pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Taste Gourmet Group Limited's Growth

Over the past three years, Taste Gourmet Group Limited has seen its earnings per share (EPS) grow by 54% per year. Its revenue is up 37% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's great to see that revenue growth is strong, too. These metrics suggest the business is growing strongly. 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 Taste Gourmet Group Limited Been A Good Investment?

Boasting a total shareholder return of 52% over three years, Taste Gourmet Group Limited has done well by shareholders. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary...

Wai Chun receives almost all of their compensation through a salary. The company's solid performance might have made most shareholders happy, possibly making CEO remuneration the least of the matters to be discussed in the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 2 warning signs for Taste Gourmet Group that investors should think about before committing capital to this stock.

Important note: Taste Gourmet 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.

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