Alfred Chan has been the CEO of The Hong Kong and China Gas Company Limited (HKG:3) since 1997. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at other big companies. 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. This process should give us an idea about how appropriately the CEO is paid.
See our latest analysis for Hong Kong and China Gas
How Does Alfred Chan's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that The Hong Kong and China Gas Company Limited has a market cap of HK$288b, and is paying total annual CEO compensation of HK$38m. (This is based on the year to December 2017). While we always look at total compensation first, we note that the salary component is less, at HK$6.0m. We looked at a group of companies with market capitalizations over HK$63b and the median CEO total compensation was HK$3.7m. Once you start looking at very large companies, you need to take a broader range, because there simply aren't that many of them.
It would therefore appear that The Hong Kong and China Gas Company Limited pays Alfred Chan more than the median CEO remuneration at large companies, in the same market. However, this fact alone doesn't mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see, below, how CEO compensation at Hong Kong and China Gas has changed over time.
Is The Hong Kong and China Gas Company Limited Growing?
The Hong Kong and China Gas Company Limited has increased its earnings per share (EPS) by an average of 8.3% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 20%.
This revenue growth could really point to a brighter future. And the modest growth in earnings per share isn't bad, either. So while we'd stop just short of calling this a top performer, but we think it is well worth watching. You might want to check this free visual report on analyst forecasts for future earnings.
Has The Hong Kong and China Gas Company Limited Been A Good Investment?
I think that the total shareholder return of 83%, over three years, would leave most The Hong Kong and China Gas Company Limited shareholders smiling. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.