Key Insights
- Sunfonda Group Holdings to hold its Annual General Meeting on 30th of May
- Salary of CN¥800.0k is part of CEO Man Chiu's total remuneration
- Total compensation is 50% below industry average
- Sunfonda Group Holdings' three-year loss to shareholders was 67% while its EPS was down 57% over the past three years
The disappointing performance at Sunfonda Group Holdings Limited (HKG:1771) will make some shareholders rather disheartened. There is an opportunity for shareholders to influence management to turn the performance around by voting on resolutions such as executive remuneration at the AGM coming up on 30th of May. From our analysis below, we think CEO compensation looks appropriate for now.
View our latest analysis for Sunfonda Group Holdings
Comparing Sunfonda Group Holdings Limited's CEO Compensation With The Industry
At the time of writing, our data shows that Sunfonda Group Holdings Limited has a market capitalization of HK$384m, and reported total annual CEO compensation of CN¥810k for the year to December 2023. There was no change in the compensation compared to last year. We note that the salary portion, which stands at CN¥800.0k constitutes the majority of total compensation received by the CEO.
On comparing similar-sized companies in the Hong Kong Specialty Retail industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was CN¥1.6m. Accordingly, Sunfonda Group Holdings pays its CEO under the industry median.
| Component | 2023 | 2022 | Proportion (2023) |
| Salary | CN¥800k | CN¥800k | 99% |
| Other | CN¥10k | CN¥10k | 1% |
| Total Compensation | CN¥810k | CN¥810k | 100% |
Speaking on an industry level, nearly 89% of total compensation represents salary, while the remainder of 11% is other remuneration. Investors will find it interesting that Sunfonda Group Holdings pays the bulk of its rewards through a traditional salary, instead of non-salary benefits. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.
A Look at Sunfonda Group Holdings Limited's Growth Numbers
Over the last three years, Sunfonda Group Holdings Limited has shrunk its earnings per share by 57% per year. The trailing twelve months of revenue was pretty much the same as the prior period.
Overall this is not a very positive result for shareholders. And the flat revenue hardly impresses. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts, you might want to assess this data-rich visualization of earnings, revenue and cash flow.
Has Sunfonda Group Holdings Limited Been A Good Investment?
Few Sunfonda Group Holdings Limited shareholders would feel satisfied with the return of -67% over three years. Therefore, it might be upsetting for shareholders if the CEO were paid generously.
In Summary...
Sunfonda Group Holdings pays its CEO a majority of compensation through a salary. Given that shareholders haven't seen any positive returns on their investment, not to mention the lack of earnings growth, this may suggest that few of them would be willing to award the CEO with a pay rise. At the upcoming AGM, the board will get the chance to explain the steps it plans to take to improve business performance.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company's key performance areas. We identified 6 warning signs for Sunfonda Group Holdings (2 shouldn't be ignored!) that you should be aware of before investing here.
Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies that have HIGH return on equity 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.