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Is China Uptown Group Company Limited (HKG:2330) Excessively Paying Its CEO?

Simply Wall St

In 2007 Anthony Lau was appointed CEO of China Uptown Group Company Limited (HKG:2330). First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. 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 China Uptown Group

How Does Anthony Lau's Compensation Compare With Similar Sized Companies?

At the time of writing, our data says that China Uptown Group Company Limited has a market cap of HK$224m, and reported total annual CEO compensation of CN¥1.7m for the year to December 2018. Notably, the salary of CN¥1.7m is the vast majority of the CEO compensation. We looked at a group of companies with market capitalizations under CN¥1.4b, and the median CEO total compensation was CN¥1.6m.

That means Anthony Lau receives fairly typical remuneration for the CEO of a company that size. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.

You can see a visual representation of the CEO compensation at China Uptown Group, below.

SEHK:2330 CEO Compensation, January 4th 2020

Is China Uptown Group Company Limited Growing?

On average over the last three years, China Uptown Group Company Limited has shrunk earnings per share by 6.6% each year (measured with a line of best fit). Its revenue is up 161% over last year.

The reduction in earnings per share, over three years, is arguably concerning. But in contrast the revenue growth is strong, suggesting future potential for earnings growth. 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 shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has China Uptown Group Company Limited Been A Good Investment?

With a three year total loss of 48%, China Uptown Group Company Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Anthony Lau is paid around the same as most CEOs of similar size companies.

The per share growth could be better, in our view. And shareholder returns have been disappointing over the last three years. So it would take a bold person to suggest the pay is too modest. Shareholders may want to check for free if China Uptown Group insiders are buying or selling shares.

Important note: China Uptown Group may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt.

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.