U.S. Markets closed

Is Kingworld Medicines Group Limited's (HKG:1110) CEO Paid Enough Relative To Peers?

Simply Wall St

The CEO of Kingworld Medicines Group Limited (HKG:1110) is Li Sheng Zhao. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.

View our latest analysis for Kingworld Medicines Group

How Does Li Sheng Zhao's Compensation Compare With Similar Sized Companies?

Our data indicates that Kingworld Medicines Group Limited is worth HK$535m, and total annual CEO compensation was reported as CN¥1.2m for the year to December 2018. Notably, the salary of CN¥1.2m 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 Li Sheng Zhao receives fairly typical remuneration for the CEO of a company that size. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.

The graphic below shows how CEO compensation at Kingworld Medicines Group has changed from year to year.

SEHK:1110 CEO Compensation, January 9th 2020

Is Kingworld Medicines Group Limited Growing?

On average over the last three years, Kingworld Medicines Group Limited has grown earnings per share (EPS) by 5.7% each year (using a line of best fit). In the last year, its revenue is down 3.5%.

I would prefer it if there was revenue growth, but the improvement in EPS is good. It's hard to reach a conclusion about business performance right now. This may be one to watch. Although we don't have analyst forecasts you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Kingworld Medicines Group Limited Been A Good Investment?

With a three year total loss of 21%, Kingworld Medicines Group Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Li Sheng Zhao is paid around the same as most CEOs of similar size companies.

The company cannot boast particularly strong per share growth. And we think the shareholder returns - over three years - have been underwhelming. So it would take a bold person to suggest the pay is too modest. So you may want to check if insiders are buying Kingworld Medicines Group shares with their own money (free access).

Important note: Kingworld Medicines 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.