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Joseph Leung became the CEO of Lam Soon (Hong Kong) Limited (HKG:411) in 2012. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
See our latest analysis for Lam Soon (Hong Kong)
How Does Joseph Leung’s Compensation Compare With Similar Sized Companies?
Our data indicates that Lam Soon (Hong Kong) Limited is worth HK$3.4b, and total annual CEO compensation is HK$3.4m. (This is based on the year to 2018). It is worth noting that the CEO compensation consists almost entirely of the salary, worth HK$3.7m. We examined companies with market caps from HK$1.6b to HK$6.3b, and discovered that the median CEO compensation of that group was HK$2.3m.
Thus we can conclude that Joseph Leung receives more in total compensation than the median of a group of companies in the same market, and of similar size to Lam Soon (Hong Kong) Limited. However, this doesn’t necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Lam Soon (Hong Kong) has changed from year to year.
Is Lam Soon (Hong Kong) Limited Growing?
On average over the last three years, Lam Soon (Hong Kong) Limited has grown earnings per share (EPS) by 31% each year (using a line of best fit). It achieved revenue growth of 12% over the last year.
This demonstrates that the company has been improving recently. A good result. It’s also good to see decent revenue growth in the last year, suggesting the business is healthy and growing. We don’t have analyst forecasts, but shareholders might want to examine this detailed historical graph of earnings, revenue and cash flow.
Has Lam Soon (Hong Kong) Limited Been A Good Investment?
I think that the total shareholder return of 205%, over three years, would leave most Lam Soon (Hong Kong) Limited shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.
In Summary…
We compared total CEO remuneration at Lam Soon (Hong Kong) Limited with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.