Key Insights

• Realord Group Holdings to hold its Annual General Meeting on 6th of June
• CEO Jiaohua Su's total compensation includes salary of HK$2.40m
• The total compensation is 33% less than the average for the industry
• Over the past three years, Realord Group Holdings' EPS fell by 56% and over the past three years, the total loss to shareholders 54%

The underwhelming performance at Realord Group Holdings Limited (HKG:1196) recently has probably not pleased shareholders. The next AGM coming up on 6th of June will be a chance for shareholders to have their concerns addressed by the board, challenge management on company strategy and vote on resolutions such as executive remuneration, which may help change the company's future prospects. The data we gathered below shows that CEO compensation looks acceptable for now.

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

According to our data, Realord Group Holdings Limited has a market capitalization of HK$7.7b, and paid its CEO total annual compensation worth HK$2.4m over the year to December 2023. This was the same as last year. In particular, the salary of HK$2.40m, makes up a huge portion of the total compensation being paid to the CEO.

In comparison with other companies in the Hong Kong Trade Distributors industry with market capitalizations ranging from HK$3.1b to HK$13b, the reported median CEO total compensation was HK$3.6m. This suggests that Jiaohua Su is paid below the industry median.

On an industry level, roughly 92% of total compensation represents salary and 8% is other remuneration. Investors will find it interesting that Realord Group Holdings pays the bulk of its rewards through a traditional salary, instead of non-salary benefits. 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.

Realord Group Holdings Limited's Growth

Over the last three years, Realord Group Holdings Limited has shrunk its earnings per share by 56% per year. Its revenue is down 33% over the previous year.

Overall this is not a very positive result for shareholders. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet 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 Realord Group Holdings Limited Been A Good Investment?

Few Realord Group Holdings Limited shareholders would feel satisfied with the return of -54% over three years. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

Realord Group 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, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.

It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We did our research and identified 2 warning signs (and 1 which is a bit concerning) in Realord Group Holdings we think you should know about.

Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.