Key Insights
- CN Logistics International Holdings' Annual General Meeting to take place on 29th of May
- CEO Tim Wing Ngan's total compensation includes salary of HK$3.71m
- The total compensation is 220% higher than the average for the industry
- CN Logistics International Holdings' three-year loss to shareholders was 47% while its EPS was down 27% over the past three years
Shareholders will probably not be too impressed with the underwhelming results at CN Logistics International Holdings Limited (HKG:2130) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 29th of May. They will also get a chance to influence managerial decision-making through voting on resolutions such as executive remuneration, which may impact firm value in the future. From our analysis, we think CEO compensation may need a review in light of the recent performance.
See our latest analysis for CN Logistics International Holdings
How Does Total Compensation For Tim Wing Ngan Compare With Other Companies In The Industry?
According to our data, CN Logistics International Holdings Limited has a market capitalization of HK$1.1b, and paid its CEO total annual compensation worth HK$4.1m over the year to December 2023. That's a notable decrease of 24% on last year. Notably, the salary which is HK$3.71m, represents most of the total compensation being paid.
On comparing similar-sized companies in the Hong Kong Logistics industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was HK$1.3m. Accordingly, our analysis reveals that CN Logistics International Holdings Limited pays Tim Wing Ngan north of the industry median. Moreover, Tim Wing Ngan also holds HK$81m worth of CN Logistics International Holdings stock directly under their own name, which reveals to us that they have a significant personal stake in the company.
| Component | 2023 | 2022 | Proportion (2023) |
| Salary | HK$3.7m | HK$5.0m | 91% |
| Other | HK$367k | HK$367k | 9% |
| Total Compensation | HK$4.1m | HK$5.4m | 100% |
On an industry level, around 78% of total compensation represents salary and 22% is other remuneration. CN Logistics International Holdings is paying a higher share of its remuneration through a salary in comparison to the overall industry. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
A Look at CN Logistics International Holdings Limited's Growth Numbers
CN Logistics International Holdings Limited has reduced its earnings per share by 27% a year over the last three years. It saw its revenue drop 25% over the last year.
The decline in EPS is a bit concerning. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. While we don't have analyst forecasts for the company, shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has CN Logistics International Holdings Limited Been A Good Investment?
With a total shareholder return of -47% over three years, CN Logistics International Holdings Limited shareholders would by and large be disappointed. This suggests it would be unwise for the company to pay the CEO too generously.
In Summary...
Not only have shareholders not seen a favorable return on their investment, but the business hasn't performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.
While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 3 warning signs for CN Logistics International Holdings that you should be aware of before investing.
Important note: CN Logistics International Holdings is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE and low debt.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.