Increases to UOB-Kay Hian Holdings Limited's (SGX:U10) CEO Compensation Might Cool off for now

editorial-team@simplywallst.com (Simply Wall St)

18 April 2024 at 9:12 pm·4-min read

Key Insights

UOB-Kay Hian Holdings to hold its Annual General Meeting on 25th of April
Total pay for CEO Ee-Chao Wee includes S$486.2k salary
The total compensation is 996% higher than the average for the industry
UOB-Kay Hian Holdings' three-year loss to shareholders was 7.4% while its EPS was down 0.5% over the past three years

In the past three years, the share price of UOB-Kay Hian Holdings Limited (SGX:U10) has struggled to generate growth for its shareholders. Per share earnings growth is also poor, despite revenues growing. In light of this performance, shareholders will have a chance to question the board in the upcoming AGM on 25th of April, where they can impact on future company performance by voting on resolutions, including executive compensation. Here's our take on why we think shareholders might be hesitant about approving a raise at the moment.

View our latest analysis for UOB-Kay Hian Holdings

Comparing UOB-Kay Hian Holdings Limited's CEO Compensation With The Industry

At the time of writing, our data shows that UOB-Kay Hian Holdings Limited has a market capitalization of S$1.2b, and reported total annual CEO compensation of S$6.6m for the year to December 2023. We note that's an increase of 55% above last year. While this analysis focuses on total compensation, it's worth acknowledging that the salary portion is lower, valued at S$486k.

In comparison with other companies in the Singapore Capital Markets industry with market capitalizations ranging from S$545m to S$2.2b, the reported median CEO total compensation was S$599k. Hence, we can conclude that Ee-Chao Wee is remunerated higher than the industry median. Furthermore, Ee-Chao Wee directly owns S$260m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2023	2022	Proportion (2023)
Salary	S$486k	S$486k	7%
Other	S$6.1m	S$3.7m	93%
Total Compensation	S$6.6m	S$4.2m	100%

Speaking on an industry level, nearly 94% of total compensation represents salary, while the remainder of 6% is other remuneration. In UOB-Kay Hian Holdings' case, non-salary compensation represents a greater slice of total remuneration, in comparison to the broader industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

UOB-Kay Hian Holdings Limited's Growth

UOB-Kay Hian Holdings Limited saw earnings per share stay pretty flat over the last three years. It achieved revenue growth of 18% over the last year.

The reduction in EPS, over three years, is arguably concerning. But on the other hand, revenue growth is strong, suggesting a brighter future. These two metrics are moving in different directions, so while it's hard to be confident judging performance, we think the stock is worth watching. 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 UOB-Kay Hian Holdings Limited Been A Good Investment?

With a three year total loss of 7.4% for the shareholders, UOB-Kay Hian Holdings Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

The company's earnings haven't grown and possibly because of that, the stock has performed poorly, resulting in a loss for the company's shareholders. The upcoming AGM will provide shareholders the opportunity to revisit the company’s remuneration policies and evaluate if the board’s judgement and decision-making is aligned with that of the company’s shareholders.

While it is important to pay attention to CEO remuneration, investors should also consider other elements of the business. We did our research and spotted 2 warning signs for UOB-Kay Hian Holdings that investors should look into moving forward.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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Key Insights

Comparing UOB-Kay Hian Holdings Limited's CEO Compensation With The Industry

UOB-Kay Hian Holdings Limited's Growth

Has UOB-Kay Hian Holdings Limited Been A Good Investment?

To Conclude...

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