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Should You Worry About CCT Land Holdings Limited’s (HKG:261) CEO Pay Cheque?

Clement Mak became the CEO of CCT Land Holdings Limited (HKG:261) in 2002. First, this article will compare CEO compensation with compensation at similar sized companies. 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 process should give us an idea about how appropriately the CEO is paid.

Check out our latest analysis for CCT Land Holdings

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

Our data indicates that CCT Land Holdings Limited is worth HK$1.8b, and total annual CEO compensation is HK$8.3m. (This figure is for the year to 2017). We think total compensation is more important but we note that the CEO salary is lower, at HK$2.8m. We looked at a group of companies with market capitalizations from HK$781m to HK$3.1b, and the median CEO compensation was HK$2.1m.

Thus we can conclude that Clement Mak receives more in total compensation than the median of a group of companies in the same market, and of similar size to CCT Land Holdings Limited. However, this doesn’t necessarily mean the pay 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, below, how CEO compensation at CCT Land Holdings has changed over time.

SEHK:261 CEO Compensation December 18th 18

Is CCT Land Holdings Limited Growing?

Over the last three years CCT Land Holdings Limited has grown its earnings per share (EPS) by an average of 7.5% per year. It saw its revenue drop -42% over the last year.

I would prefer it if there was revenue growth, but I’m happy with the EPS growth. It’s hard to reach a conclusion about business performance right now. This may be one to watch.

We don’t have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.

Has CCT Land Holdings Limited Been A Good Investment?

With a three year total loss of 50%, CCT Land Holdings Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary…

We compared the total CEO remuneration paid by CCT Land 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.

Over the last three years, shareholder returns have been downright disappointing, and the underlying business has failed to impress us. Although we’d stop short of calling it inappropriate, we think the CEO compensation is probably more on the generous side of things. CEO compensation is one thing, but it is also interesting to check if the CEO is buying or selling CCT Land Holdings (free visualization of insider trades).

Of course, the past can be informative so you might be interested in considering this analytical visualization showing the company history of earnings and revenue.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.