Key Insights

• CL Group (Holdings) to hold its Annual General Meeting on 6th of August
• Salary of HK$1.09m is part of CEO Kin Chung Kwok's total remuneration
• The total compensation is 45% less than the average for the industry
• Over the past three years, CL Group (Holdings)'s EPS fell by 95% and over the past three years, the total loss to shareholders 31%

Performance at CL Group (Holdings) Limited (HKG:8098) has been rather uninspiring recently and shareholders may be wondering how CEO Kin Chung Kwok plans to fix this. At the next AGM coming up on 6th of August, they can influence managerial decision making through voting on resolutions, including executive remuneration. Setting appropriate executive remuneration to align with the interests of shareholders may also be a way to influence the company performance in the long run. We think CEO compensation looks appropriate given the data we have put together.

How Does Total Compensation For Kin Chung Kwok Compare With Other Companies In The Industry?

According to our data, CL Group (Holdings) Limited has a market capitalization of HK$114m, and paid its CEO total annual compensation worth HK$1.1m over the year to March 2024. That's a slight decrease of 3.7% on the prior year. We note that the salary portion, which stands at HK$1.09m constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the Hong Kong Capital Markets industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was HK$2.0m. That is to say, Kin Chung Kwok is paid under the industry median.

Talking in terms of the industry, salary represented approximately 84% of total compensation out of all the companies we analyzed, while other remuneration made up 16% of the pie. CL Group (Holdings) pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. 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 CL Group (Holdings) Limited's Growth Numbers

CL Group (Holdings) Limited has reduced its earnings per share by 95% a year over the last three years. In the last year, its revenue is up 36%.

The decrease in EPS could be a concern for some investors. But on the other hand, revenue growth is strong, suggesting a brighter future. It's hard to reach a conclusion about business performance right now. This may be one to watch. 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 CL Group (Holdings) Limited Been A Good Investment?

With a total shareholder return of -31% over three years, CL Group (Holdings) Limited shareholders would by and large be disappointed. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

CL Group (Holdings) pays its CEO a majority of compensation through a salary. The fact that shareholders are sitting on a loss is certainly disheartening. The fact that earnings growth has gone backwards could be a factor for the downward trend in the share price. In the upcoming AGM, shareholders should take this opportunity to raise these concerns with the board and revisit their investment thesis with regards to the company.

We can learn a lot about a company by studying its CEO compensation trends, along with looking at other aspects of the business. We did our research and identified 4 warning signs (and 1 which shouldn't be ignored) in CL Group (Holdings) we think you should know about.

Important note: CL Group (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.

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