Yahoo Finance Increases to CEO Compensation Might Be Put On Hold For Now at Kuala Lumpur Kepong Berhad (KLSE:KLK)
Key Insights
Kuala Lumpur Kepong Berhad will host its Annual General Meeting on 22nd of February
Total pay for CEO Oi Hian Lee includes RM6.12m salary
The overall pay is 61% above the industry average
Over the past three years, Kuala Lumpur Kepong Berhad's EPS grew by 2.4% and over the past three years, the total shareholder return was 10%
CEO Oi Hian Lee has done a decent job of delivering relatively good performance at Kuala Lumpur Kepong Berhad (KLSE:KLK) recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 22nd of February. However, some shareholders may still be hesitant of being overly generous with CEO compensation.
Check out our latest analysis for Kuala Lumpur Kepong Berhad
How Does Total Compensation For Oi Hian Lee Compare With Other Companies In The Industry?
Our data indicates that Kuala Lumpur Kepong Berhad has a market capitalization of RM24b, and total annual CEO compensation was reported as RM14m for the year to September 2023. We note that's a decrease of 13% compared to last year. We think total compensation is more important but our data shows that the CEO salary is lower, at RM6.1m.
On comparing similar companies from the Malaysian Food industry with market caps ranging from RM19b to RM57b, we found that the median CEO total compensation was RM8.9m. Accordingly, our analysis reveals that Kuala Lumpur Kepong Berhad pays Oi Hian Lee north of the industry median. Furthermore, Oi Hian Lee directly owns RM3.4m worth of shares in the company.
Component | 2023 | 2022 | Proportion (2023) |
Salary | RM6.1m | RM5.6m | 43% |
Other | RM8.3m | RM11m | 57% |
Total Compensation | RM14m | RM17m | 100% |
On an industry level, roughly 68% of total compensation represents salary and 32% is other remuneration. Kuala Lumpur Kepong Berhad pays a modest slice of remuneration through salary, as compared to the broader industry. If non-salary compensation dominates total pay, it's an indicator that the executive's salary is tied to company performance.
Kuala Lumpur Kepong Berhad's Growth
Kuala Lumpur Kepong Berhad has seen its earnings per share (EPS) increase by 2.4% a year over the past three years. Its revenue is down 13% over the previous year.
We generally like to see a little revenue growth, but the modest EPS growth gives us some relief. It's hard to reach a conclusion about business performance right now. This may be one to watch. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..
Has Kuala Lumpur Kepong Berhad Been A Good Investment?
With a total shareholder return of 10% over three years, Kuala Lumpur Kepong Berhad shareholders would, in general, be reasonably content. But they probably don't want to see the CEO paid more than is normal for companies around the same size.
In Summary...
Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, any decision to raise CEO pay might be met with some objections from the shareholders given that the CEO is already paid higher than the industry average.
CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. That's why we did our research, and identified 3 warning signs for Kuala Lumpur Kepong Berhad (of which 1 is potentially serious!) that you should know about in order to have a holistic understanding of the stock.
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.
