Edwin Lun became the CEO of Mexan Limited (HKG:22) in 2007. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This process should give us an idea about how appropriately the CEO is paid.
See our latest analysis for Mexan
How Does Edwin Lun's Compensation Compare With Similar Sized Companies?
According to our data, Mexan Limited has a market capitalization of HK$376m, and paid its CEO total annual compensation worth HK$602k over the year to March 2019. While we always look at total compensation first, we note that the salary component is less, at . We further remind readers that the CEO may face performance requirements to receive the non-salary part of the total compensation. We examined a group of similar sized companies, with market capitalizations of below HK$1.6b. The median CEO total compensation in that group is HK$1.7m.
A first glance this seems like a real positive for shareholders, since Edwin Lun is paid less than the average total compensation paid by similar sized companies. While this is a good thing, you'll need to understand the business better before you can form an opinion.
You can see, below, how CEO compensation at Mexan has changed over time.
Is Mexan Limited Growing?
On average over the last three years, Mexan Limited has shrunk earnings per share by 100% each year (measured with a line of best fit). In the last year, its revenue is up 16%.
Few shareholders would be pleased to read that earnings per share are lower over three years. While the revenue growth is good to see, it is outweighed by the fact that earnings per share are down, over three years. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Although we don't have analyst forecasts you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Has Mexan Limited Been A Good Investment?
Given the total loss of 23% over three years, many shareholders in Mexan Limited are probably rather dissatisfied, to say the least. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
In Summary...
It appears that Mexan Limited remunerates its CEO below most similar sized companies.
Shareholders should note that compensation for Edwin Lun is under the median of a group of similar sized companies. But then, EPS growth is lacking and so are the returns to shareholders. We would not call the pay too generous, but nor would we claim the CEO is underpaid, given lacklustre business performance. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Mexan.