Key Insights

• Golden Wheel Tiandi Holdings will host its Annual General Meeting on 29th of May
• CEO Kam Fai Wong's total compensation includes salary of CN¥3.99m
• Total compensation is 144% above industry average
• Golden Wheel Tiandi Holdings' EPS declined by 30% over the past three years while total shareholder loss over the past three years was 83%

Shareholders will probably not be too impressed with the underwhelming results at Golden Wheel Tiandi Holdings Company Limited (HKG:1232) recently. At the upcoming AGM on 29th of May, shareholders can hear from the board including their plans for turning around performance. 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. The data we present below explains why we think CEO compensation is not consistent with recent performance.

How Does Total Compensation For Kam Fai Wong Compare With Other Companies In The Industry?

According to our data, Golden Wheel Tiandi Holdings Company Limited has a market capitalization of HK$160m, and paid its CEO total annual compensation worth CN¥4.1m over the year to December 2023. We note that's an increase of 18% above last year. Notably, the salary which is CN¥3.99m, represents most of the total compensation being paid.

In comparison with other companies in the Hong Kong Real Estate industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was CN¥1.7m. Accordingly, our analysis reveals that Golden Wheel Tiandi Holdings Company Limited pays Kam Fai Wong north of the industry median. Furthermore, Kam Fai Wong directly owns HK$1.3m worth of shares in the company.

On an industry level, around 77% of total compensation represents salary and 23% is other remuneration. Golden Wheel Tiandi Holdings pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Golden Wheel Tiandi Holdings Company Limited's Growth Numbers

Over the last three years, Golden Wheel Tiandi Holdings Company Limited has shrunk its earnings per share by 30% per year. It saw its revenue drop 10% over the last year.

Overall this is not a very positive result for shareholders. And the fact that revenue is down year on year arguably paints an ugly picture. 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 Golden Wheel Tiandi Holdings Company Limited Been A Good Investment?

The return of -83% over three years would not have pleased Golden Wheel Tiandi Holdings Company Limited shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Golden Wheel Tiandi Holdings pays its CEO a majority of compensation through a salary. 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, 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 Golden Wheel Tiandi Holdings (2 are significant!) that you should be aware of before investing here.

Switching gears from Golden Wheel Tiandi 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.

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