Key Insights

• WAC Holdings' Annual General Meeting to take place on 27th of October
• Salary of HK$2.16m is part of CEO Po Lam Kwong's total remuneration
• Total compensation is 83% above industry average
• WAC Holdings' EPS declined by 12% over the past three years while total shareholder loss over the past three years was 93%

The results at WAC Holdings Limited (HKG:8619) have been quite disappointing recently and CEO Po Lam Kwong bears some responsibility for this. Shareholders can take the chance to hold the board and management accountable for the unsatisfactory performance at the next AGM on 27th of October. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. From our analysis, we think CEO compensation may need a review in light of the recent performance.

See our latest analysis for WAC Holdings

Comparing WAC Holdings Limited's CEO Compensation With The Industry

Our data indicates that WAC Holdings Limited has a market capitalization of HK$63m, and total annual CEO compensation was reported as HK$4.1m for the year to March 2023. We note that's an increase of 36% above last year. Notably, the salary which is HK$2.16m, represents a considerable chunk of the total compensation being paid.

In comparison with other companies in the Hong Kong Professional Services industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was HK$2.2m. This suggests that Po Lam Kwong is paid more than the median for the industry.

On an industry level, roughly 82% of total compensation represents salary and 18% is other remuneration. It's interesting to note that WAC Holdings allocates a smaller portion of compensation to salary in comparison to the broader industry. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

A Look at WAC Holdings Limited's Growth Numbers

Over the last three years, WAC Holdings Limited has shrunk its earnings per share by 12% per year. In the last year, its revenue is up 12%.

Few shareholders would be pleased to read that EPS have declined. There's no doubt that the silver lining is that revenue is up. But it isn't sufficiently fast growth to overlook the fact that EPS has gone backwards over three years. 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 WAC Holdings Limited Been A Good Investment?

Few WAC Holdings Limited shareholders would feel satisfied with the return of -93% over three years. 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, the board will get the chance to explain the steps it plans to take to improve business performance.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. We did our research and spotted 2 warning signs for WAC Holdings that investors should look into moving forward.

Important note: WAC Holdings 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.