Key Insights

• AM Group Holdings' Annual General Meeting to take place on 29th of November
• Total pay for CEO Zhang Lilian Teo includes S$1.03m salary
• Total compensation is 558% above industry average
• AM Group Holdings' three-year loss to shareholders was 81% while its EPS was down 46% over the past three years

The results at AM Group Holdings Limited (HKG:1849) have been quite disappointing recently and CEO Zhang Lilian Teo bears some responsibility for this. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 29th of November. This will be also be a chance where they can challenge the board on company direction and vote on resolutions such as executive remuneration. From our analysis, we think CEO compensation may need a review in light of the recent performance.

View our latest analysis for AM Group Holdings

Comparing AM Group Holdings Limited's CEO Compensation With The Industry

According to our data, AM Group Holdings Limited has a market capitalization of HK$98m, and paid its CEO total annual compensation worth S$1.8m over the year to June 2023. We note that's an increase of 58% above last year. We note that the salary of S$1.03m makes up a sizeable portion of the total compensation received by the CEO.

On comparing similar-sized companies in the Hong Kong Media industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was S$274k. This suggests that Zhang Lilian Teo is paid more than the median for the industry. What's more, Zhang Lilian Teo holds HK$563k worth of shares in the company in their own name.

On an industry level, roughly 86% of total compensation represents salary and 14% is other remuneration. AM Group Holdings sets aside a smaller share of compensation for salary, in comparison to the overall 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.

AM Group Holdings Limited's Growth

Over the last three years, AM Group Holdings Limited has shrunk its earnings per share by 46% per year. The trailing twelve months of revenue was pretty much the same as the prior period.

Overall this is not a very positive result for shareholders. And the flat revenue hardly impresses. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. 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 AM Group Holdings Limited Been A Good Investment?

Few AM Group Holdings Limited shareholders would feel satisfied with the return of -81% over three years. So shareholders would probably want the company to be less generous with CEO compensation.

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.

CEO pay is simply one of the many factors that need to be considered while examining business performance. That's why we did our research, and identified 3 warning signs for AM Group Holdings (of which 1 is concerning!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from AM Group 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.