Is Hengdeli Holdings Limited's (HKG:3389) CEO Salary Justified?

In This Article:

The CEO of Hengdeli Holdings Limited (HKG:3389) is Yuping Zhang. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. This method should give us information to assess how appropriately the company pays the CEO.

Check out our latest analysis for Hengdeli Holdings

How Does Yuping Zhang's Compensation Compare With Similar Sized Companies?

At the time of writing our data says that Hengdeli Holdings Limited has a market cap of HK$1.9b, and is paying total annual CEO compensation of CN¥2.2m. (This figure is for the year to December 2017). While we always look at total compensation first, we note that the salary component is less, at CN¥2.0m. We examined companies with market caps from CN¥672m to CN¥2.7b, and discovered that the median CEO total compensation of that group was CN¥1.5m.

As you can see, Yuping Zhang is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Hengdeli Holdings Limited is paying too much. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.

The graphic below shows how CEO compensation at Hengdeli Holdings has changed from year to year.

SEHK:3389 CEO Compensation, April 26th 2019
SEHK:3389 CEO Compensation, April 26th 2019

Is Hengdeli Holdings Limited Growing?

Hengdeli Holdings Limited has increased its earnings per share (EPS) by an average of 22% a year, over the last three years (using a line of best fit). Its revenue is up 10% over last year.

This shows that the company has improved itself over the last few years. Good news for shareholders. It's also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.

Has Hengdeli Holdings Limited Been A Good Investment?

Given the total loss of 21% over three years, many shareholders in Hengdeli Holdings Limited are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.

In Summary...

We compared the total CEO remuneration paid by Hengdeli Holdings Limited, and compared it to remuneration at a group of similar sized companies. Our data suggests that it pays above the median CEO pay within that group.