Key Insights

• Asia Standard Hotel Group's Annual General Meeting to take place on 4th of September
• CEO Yin Cheng Lim's total compensation includes salary of HK$1.20m
• Total compensation is similar to the industry average
• Over the past three years, Asia Standard Hotel Group's EPS fell by 90% and over the past three years, the total loss to shareholders 62%

The results at Asia Standard Hotel Group Limited (HKG:292) have been quite disappointing recently and CEO Yin Cheng Lim 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 4th of September. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. The data we present below explains why we think CEO compensation is not consistent with recent performance.

Comparing Asia Standard Hotel Group Limited's CEO Compensation With The Industry

Our data indicates that Asia Standard Hotel Group Limited has a market capitalization of HK$155m, and total annual CEO compensation was reported as HK$2.0m for the year to March 2024. This means that the compensation hasn't changed much from last year. We note that the salary of HK$1.20m makes up a sizeable portion of the total compensation received by the CEO.

For comparison, other companies in the Hong Kong Hospitality industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$2.0m. So it looks like Asia Standard Hotel Group compensates Yin Cheng Lim in line with the median for the industry.

On an industry level, roughly 87% of total compensation represents salary and 13% is other remuneration. It's interesting to note that Asia Standard Hotel Group allocates a smaller portion of compensation to salary in comparison to the broader industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

Asia Standard Hotel Group Limited's Growth

Over the last three years, Asia Standard Hotel Group Limited has shrunk its earnings per share by 90% per year. Its revenue is down 3.8% over the previous year.

Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Asia Standard Hotel Group Limited Been A Good Investment?

With a total shareholder return of -62% over three years, Asia Standard Hotel Group Limited shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. We identified 4 warning signs for Asia Standard Hotel Group (2 make us uncomfortable!) that you should be aware of before investing here.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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.