Here's Why It's Unlikely That Centenary United Holdings Limited's (HKG:1959) CEO Will See A Pay Rise This Year

Key Insights

• Centenary United Holdings will host its Annual General Meeting on 23rd of May
• Salary of CN¥1.44m is part of CEO Hau Kit Law's total remuneration
• The total compensation is similar to the average for the industry
• Centenary United Holdings' three-year loss to shareholders was 28% while its EPS was down 82% over the past three years

Centenary United Holdings Limited (HKG:1959) has not performed well recently and CEO Hau Kit Law will probably need to up their game. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 23rd of May. 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. From our analysis, we think CEO compensation may need a review in light of the recent performance.

View our latest analysis for Centenary United Holdings

How Does Total Compensation For Hau Kit Law Compare With Other Companies In The Industry?

According to our data, Centenary United Holdings Limited has a market capitalization of HK$162m, and paid its CEO total annual compensation worth CN¥1.5m over the year to December 2024. Notably, that's a decrease of 24% over the year before. We note that the salary portion, which stands at CN¥1.44m constitutes the majority of total compensation received by the CEO.

On comparing similar-sized companies in the Hong Kong Specialty Retail industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was CN¥1.6m. So it looks like Centenary United Holdings compensates Hau Kit Law in line with the median for the industry. Furthermore, Hau Kit Law directly owns HK$121m worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the industry, salary represented approximately 85% of total compensation out of all the companies we analyzed, while other remuneration made up 15% of the pie. Investors will find it interesting that Centenary United Holdings pays the bulk of its rewards through a traditional salary, instead of non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

Centenary United Holdings Limited's Growth

Over the last three years, Centenary United Holdings Limited has shrunk its earnings per share by 82% per year. It saw its revenue drop 23% over the last year.

Overall this is not a very positive result for shareholders. 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. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Centenary United Holdings Limited Been A Good Investment?

Given the total shareholder loss of 28% over three years, many shareholders in Centenary United Holdings Limited are probably rather dissatisfied, to say the least. So shareholders would probably want the company to be less generous with CEO compensation.

In Summary...

Centenary United Holdings pays its CEO a majority of compensation through a salary. 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. That's why we did our research, and identified 2 warning signs for Centenary United Holdings (of which 1 is concerning!) that you should know about in order to have a holistic understanding of the stock.

Switching gears from Centenary United 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.