In 2016 Helen Huang was appointed CEO of Kingmaker Footwear Holdings Limited (HKG:1170). First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
How Does Helen Huang's Compensation Compare With Similar Sized Companies?
Our data indicates that Kingmaker Footwear Holdings Limited is worth HK$760m, and total annual CEO compensation was reported as HK$1.1m for the year to March 2019. It is worth noting that the CEO compensation consists almost entirely of the salary, worth HK$1.1m. 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$1.7m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. While this is a good thing, you'll need to understand the business better before you can form an opinion.
You can see, below, how CEO compensation at Kingmaker Footwear Holdings has changed over time.
Is Kingmaker Footwear Holdings Limited Growing?
Over the last three years Kingmaker Footwear Holdings Limited has shrunk its earnings per share by an average of 15% per year (measured with a line of best fit). Its revenue is down 5.5% over last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. This is compounded by the fact revenue is actually down on last year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Kingmaker Footwear Holdings Limited Been A Good Investment?
With a three year total loss of 23%, Kingmaker Footwear Holdings Limited would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
It looks like Kingmaker Footwear Holdings Limited pays its CEO less than similar sized companies.
Shareholders should note that compensation for Helen Huang is under the median of a group of similar sized companies. But then, EPS growth is lacking and so are the returns to shareholders. Considering all these factors, we'd stop short of saying the CEO pay is too high, but we don't think shareholders would want to see a pay rise before business performance improves. Shareholders may want to check for free if Kingmaker Footwear Holdings insiders are buying or selling shares.
Important note: Kingmaker Footwear Holdings 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.
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