Key Insights

• Zhi Sheng Group Holdings to hold its Annual General Meeting on 14th of October
• Total pay for CEO Cong Yi includes CN¥480.0k salary
• The overall pay is 68% below the industry average
• Zhi Sheng Group Holdings' EPS declined by 26% over the past three years while total shareholder loss over the past three years was 81%

The underwhelming performance at Zhi Sheng Group Holdings Limited (HKG:8370) recently has probably not pleased shareholders. At the upcoming AGM on 14th of October, 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.

How Does Total Compensation For Cong Yi Compare With Other Companies In The Industry?

According to our data, Zhi Sheng Group Holdings Limited has a market capitalization of HK$63m, and paid its CEO total annual compensation worth CN¥523k over the year to June 2024. We note that's a small decrease of 7.1% on last year. In particular, the salary of CN¥480.0k, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Hong Kong Commercial Services industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was CN¥1.6m. Accordingly, Zhi Sheng Group Holdings pays its CEO under the industry median. Furthermore, Cong Yi directly owns HK$5.5m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, around 82% of total compensation represents salary and 18% is other remuneration. According to our research, Zhi Sheng Group Holdings has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Zhi Sheng Group Holdings Limited's Growth Numbers

Over the last three years, Zhi Sheng Group Holdings Limited has shrunk its earnings per share by 26% per year. It saw its revenue drop 48% over the last year.

Few shareholders would be pleased to read that EPS have declined. 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. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Zhi Sheng Group Holdings Limited Been A Good Investment?

The return of -81% over three years would not have pleased Zhi Sheng Group Holdings Limited shareholders. Therefore, it might be upsetting for shareholders if the CEO were paid generously.

To Conclude...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We identified 3 warning signs for Zhi Sheng Group Holdings (2 make us uncomfortable!) 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.

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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.