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Is CCT Fortis Holdings Limited's (HKG:138) CEO Salary Justified?

Simply Wall St

Clement Mak became the CEO of CCT Fortis Holdings Limited (HKG:138) in 1994. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.

See our latest analysis for CCT Fortis Holdings

How Does Clement Mak's Compensation Compare With Similar Sized Companies?

Our data indicates that CCT Fortis Holdings Limited is worth HK$371m, and total annual CEO compensation was reported as HK$10m for the year to December 2018. We think total compensation is more important but we note that the CEO salary is lower, at HK$9.0m. We examined a group of similar sized companies, with market capitalizations of below HK$1.6b. The median CEO total compensation in that group is HK$1.8m.

It would therefore appear that CCT Fortis Holdings Limited pays Clement Mak more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.

You can see a visual representation of the CEO compensation at CCT Fortis Holdings, below.

SEHK:138 CEO Compensation, January 5th 2020

Is CCT Fortis Holdings Limited Growing?

CCT Fortis Holdings Limited has reduced its earnings per share by an average of 81% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is up 67%.

As investors, we are a bit wary of companies that have lower earnings per share, over three years. On the other hand, the strong revenue growth suggests the business is growing. These two metric are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. 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 CCT Fortis Holdings Limited Been A Good Investment?

Given the total loss of 56% over three years, many shareholders in CCT Fortis Holdings Limited are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We compared the total CEO remuneration paid by CCT Fortis Holdings Limited, and compared it to remuneration at a group of similar sized companies. We found that it pays well over the median amount paid in the benchmark group.

While we have not been overly impressed by the business performance, the shareholder returns, over three years, have been disappointing. Shareholders may wish to consider further research. Although we don't think the CEO pay is too high, it is probably more on the generous side of things. Whatever your view on compensation, you might want to check if insiders are buying or selling CCT Fortis Holdings shares (free trial).

If you want to buy a stock that is better than CCT Fortis Holdings, this free list of high return, low debt companies is a great place to look.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.