In This Article:
Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
Chai Yip has been the CEO of Lai Sun Garment (International) Limited (HKG:191) since 2013. First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. 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 Lai Sun Garment (International)
How Does Chai Yip's Compensation Compare With Similar Sized Companies?
At the time of writing our data says that Lai Sun Garment (International) Limited has a market cap of HK$4.1b, and is paying total annual CEO compensation of HK$7.1m. (This number is for the twelve months until July 2018). Notably, the salary of HK$7.0m is the vast majority of the CEO compensation. When we examined a selection of companies with market caps ranging from HK$1.6b to HK$6.3b, we found the median CEO total compensation was HK$2.2m.
As you can see, Chai Yip is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Lai Sun Garment (International) Limited is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Lai Sun Garment (International) has changed from year to year.
Is Lai Sun Garment (International) Limited Growing?
Lai Sun Garment (International) Limited has increased its earnings per share (EPS) by an average of 59% a year, over the last three years (using a line of best fit). Its revenue is up 174% over last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see. We don't have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Lai Sun Garment (International) Limited Been A Good Investment?
Most shareholders would probably be pleased with Lai Sun Garment (International) Limited for providing a total return of 120% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.