Is ASL Marine Holdings Ltd. (SGX:A04) Overpaying Its CEO?
In 2003 Kok Tian Ang was appointed CEO of ASL Marine Holdings Ltd. (SGX:A04). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
See our latest analysis for ASL Marine Holdings
How Does Kok Tian Ang's Compensation Compare With Similar Sized Companies?
According to our data, ASL Marine Holdings Ltd. has a market capitalization of S$22m, and paid its CEO total annual compensation worth S$473k over the year to June 2019. We think total compensation is more important but we note that the CEO salary is lower, at S$369k. We took a group of companies with market capitalizations below S$283m, and calculated the median CEO total compensation to be S$473k.
Pay mix tells us a lot about how a company functions versus the wider industry, and it's no different in the case of ASL Marine Holdings. On an industry level, roughly 75% of total compensation represents salary and 25% is other remuneration. So it seems like there isn't a significant difference between ASL Marine Holdings and the broader market, in terms of salary allocation in the overall compensation package.
So Kok Tian Ang is paid around the average of the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance. You can see a visual representation of the CEO compensation at ASL Marine Holdings, below.
Is ASL Marine Holdings Ltd. Growing?
Over the last three years ASL Marine Holdings Ltd. has shrunk its earnings per share by an average of 42% per year (measured with a line of best fit). It saw its revenue drop 9.5% over the last year.
Unfortunately, earnings per share have trended lower over the last three years. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. 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 ASL Marine Holdings Ltd. Been A Good Investment?
Since shareholders would have lost about 74% over three years, some ASL Marine Holdings Ltd. shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
Kok Tian Ang is paid around the same as most CEOs of similar size companies.
Returns have been disappointing and the company is not growing its earnings per share. Few would argue that it's wise for the company to pay any more, before returns improve. Taking a breather from CEO compensation, we've spotted 4 warning signs for ASL Marine Holdings (of which 1 is potentially serious!) you should know about in order to have a holistic understanding of the stock.
If you want to buy a stock that is better than ASL Marine Holdings, this free list of high return, low debt companies is a great place to look.
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