Lin-Chit Hui is the CEO of Hengan International Group Company Limited (HKG:1044). 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. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
How Does Lin-Chit Hui's Compensation Compare With Similar Sized Companies?
Our data indicates that Hengan International Group Company Limited is worth HK$64b, and total annual CEO compensation was reported as CN¥1.2m for the year to December 2018. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at CN¥679k. We looked at a group of companies with market capitalizations from CN¥28b to CN¥84b, and the median CEO total compensation was CN¥4.3m.
Most shareholders would consider it a positive that Lin-Chit Hui takes less total compensation than the CEOs of most similar size companies, leaving more for shareholders. Though positive, it's important we delve into the performance of the actual business.
The graphic below shows how CEO compensation at Hengan International Group has changed from year to year.
Is Hengan International Group Company Limited Growing?
On average over the last three years, Hengan International Group Company Limited has grown earnings per share (EPS) by 5.8% each year (using a line of best fit). Its revenue is up 8.5% over last year.
I'm not particularly impressed by the revenue growth, but I'm happy with the modest EPS growth. Considering these factors I'd say performance has been pretty decent, though not amazing. It could be important to check this free visual depiction of what analysts expect for the future.
Has Hengan International Group Company Limited Been A Good Investment?
Hengan International Group Company Limited has not done too badly by shareholders, with a total return of 1.5%, over three years. But they would probably prefer not to see CEO compensation far in excess of the median.
It appears that Hengan International Group Company Limited remunerates its CEO below most similar sized companies.
It's well worth noting that while Lin-Chit Hui is paid less than most company leaders (at companies of similar size), share price performance has been somewhat uninspiring. But on this analysis I see no issue with the CEO compensation. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Hengan International Group.
If you want to buy a stock that is better than Hengan International Group, this free list of high return, low debt companies is a great place to look.
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