Here's Why Shareholders Should Examine Kingboard Laminates Holdings Limited's (HKG:1888) CEO Compensation Package More Closely

Key Insights

• Kingboard Laminates Holdings will host its Annual General Meeting on 26th of May
• Salary of HK$2.93m is part of CEO Kwok Keung Cheung's total remuneration
• The overall pay is 277% above the industry average
• Over the past three years, Kingboard Laminates Holdings' EPS fell by 42% and over the past three years, the total loss to shareholders 13%

The results at Kingboard Laminates Holdings Limited (HKG:1888) have been quite disappointing recently and CEO Kwok Keung Cheung 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 26th of May. 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. We present the case why we think CEO compensation is out of sync with company performance.

See our latest analysis for Kingboard Laminates Holdings

How Does Total Compensation For Kwok Keung Cheung Compare With Other Companies In The Industry?

According to our data, Kingboard Laminates Holdings Limited has a market capitalization of HK$28b, and paid its CEO total annual compensation worth HK$16m over the year to December 2024. Notably, that's a decrease of 33% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at HK$2.9m.

On examining similar-sized companies in the Hong Kong Electronic industry with market capitalizations between HK$16b and HK$50b, we discovered that the median CEO total compensation of that group was HK$4.3m. Hence, we can conclude that Kwok Keung Cheung is remunerated higher than the industry median. Furthermore, Kwok Keung Cheung directly owns HK$22m worth of shares in the company, implying that they are deeply invested in the company's success.

On an industry level, roughly 79% of total compensation represents salary and 21% is other remuneration. Kingboard Laminates Holdings pays a modest slice of remuneration through salary, as compared to the broader industry. If total compensation is slanted towards non-salary benefits, it indicates that CEO pay is linked to company performance.

Kingboard Laminates Holdings Limited's Growth

Kingboard Laminates Holdings Limited has reduced its earnings per share by 42% a year over the last three years. Its revenue is up 11% over the last year.

Overall this is not a very positive result for shareholders. There's no doubt that the silver lining is that revenue is up. But it isn't sufficiently fast growth to overlook the fact that EPS has gone backwards over three years. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Kingboard Laminates Holdings Limited Been A Good Investment?

Given the total shareholder loss of 13% over three years, many shareholders in Kingboard Laminates 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...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO 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.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for Kingboard Laminates Holdings that investors should think about before committing capital to this stock.

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.

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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.