NTPM Holdings Berhad’s Annual General Meeting to take place on 25th of September
CEO Chong Lee’s total compensation includes salary of RM974.4k
Total compensation is 223% above industry average
Over the past three years, NTPM Holdings Berhad’s EPS fell by 41% and over the past three years, the total loss to shareholders 19%
Shareholders will probably not be too impressed with the underwhelming results at NTPM Holdings Berhad (KLSE:NTPM) recently. Shareholders will be interested in what the board will have to say about turning performance around at the next AGM on 25th of September. It would also be an opportunity for shareholders to influence management through voting on company resolutions such as executive remuneration, which could impact the firm significantly. The data we present below explains why we think CEO compensation is not consistent with recent performance.
Comparing NTPM Holdings Berhad’s CEO Compensation With The Industry
At the time of writing, our data shows that NTPM Holdings Berhad has a market capitalization of RM472m, and reported total annual CEO compensation of RM1.4m for the year to April 2023. That’s a notable decrease of 27% on last year. Notably, the salary which is RM974.4k, represents most of the total compensation being paid.
In comparison with other companies in the Malaysia Household Products industry with market capitalizations under RM938m, the reported median total CEO compensation was RM419k. Accordingly, our analysis reveals that NTPM Holdings Berhad pays Chong Lee north of the industry median. Furthermore, Chong Lee directly owns RM55m worth of shares in the company, implying that they are deeply invested in the company’s success.
On an industry level, around 75% of total compensation represents salary and 25% is other remuneration. There isn’t a significant difference between NTPM Holdings Berhad and the broader market, in terms of salary allocation in the overall compensation package. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.
A Look at NTPM Holdings Berhad’s Growth Numbers
Over the last three years, NTPM Holdings Berhad has shrunk its earnings per share by 41% per year. It achieved revenue growth of 14% over the last year.
Few shareholders would be pleased to read that EPS have declined. While the revenue growth is good to see, it is outweighed by the fact that EPS are down, over three years. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Looking ahead, you might want to check this free visual report on analyst forecasts for the company’s future earnings..
Has NTPM Holdings Berhad Been A Good Investment?
Since shareholders would have lost about 19% over three years, some NTPM Holdings Berhad investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
Not only have shareholders not seen a favorable return on their investment, but the business hasn’t performed well either. Few shareholders would be willing to award the CEO with a pay raise. At the upcoming AGM, management will get a chance to explain how they plan to get the business back on track and address the concerns from investors.
CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That’s why we did some digging and identified 1 warning sign for NTPM Holdings Berhad that investors should think about before committing capital to this stock.
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.
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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.