Key Insights

• Asia Cassava Resources Holdings will host its Annual General Meeting on 25th of September
• Total pay for CEO Ming Chuan Chu includes HK$1.50m salary
• The overall pay is comparable to the industry average
• Over the past three years, Asia Cassava Resources Holdings' EPS grew by 14% and over the past three years, the total loss to shareholders 24%

Shareholders of Asia Cassava Resources Holdings Limited (HKG:841) will have been dismayed by the negative share price return over the last three years. What is concerning is that despite positive EPS growth, the share price has not tracked the trend in fundamentals. The AGM coming up on the 25th of September could be an opportunity for shareholders to bring these concerns to the board's attention. They could also try to influence management and firm direction through voting on resolutions such as executive remuneration and other company matters. Here's our take on why we think shareholders may want to be cautious of approving a raise for the CEO at the moment.

Check out our latest analysis for Asia Cassava Resources Holdings

How Does Total Compensation For Ming Chuan Chu Compare With Other Companies In The Industry?

According to our data, Asia Cassava Resources Holdings Limited has a market capitalization of HK$99m, and paid its CEO total annual compensation worth HK$1.5m over the year to March 2023. There was no change in the compensation compared to last year. We note that the salary portion, which stands at HK$1.50m constitutes the majority of total compensation received by the CEO.

For comparison, other companies in the Hong Kong Food industry with market capitalizations below HK$1.6b, reported a median total CEO compensation of HK$1.5m. This suggests that Asia Cassava Resources Holdings remunerates its CEO largely in line with the industry average. Furthermore, Ming Chuan Chu directly owns HK$61m worth of shares in the company, implying that they are deeply invested in the company's success.

Talking in terms of the industry, salary represented approximately 70% of total compensation out of all the companies we analyzed, while other remuneration made up 30% of the pie. Asia Cassava Resources Holdings pays a high salary, concentrating more on this aspect of compensation in comparison to non-salary pay. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

A Look at Asia Cassava Resources Holdings Limited's Growth Numbers

Over the past three years, Asia Cassava Resources Holdings Limited has seen its earnings per share (EPS) grow by 14% per year. Its revenue is up 11% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. 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 you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Asia Cassava Resources Holdings Limited Been A Good Investment?

With a three year total loss of 24% for the shareholders, Asia Cassava Resources Holdings Limited would certainly have some dissatisfied shareholders. So shareholders would probably want the company to be less generous with CEO compensation.

To Conclude...

Asia Cassava Resources Holdings pays its CEO a majority of compensation through a salary. The fact that shareholders are sitting on a loss on the value of their shares in the past few years is certainly disconcerting. A huge lag in share price growth when earnings have grown may indicate there could be other issues that are affecting the company at the moment that the market is focused on. If there are some unknown variables that are influencing the stock's price, surely shareholders would have some concerns. The upcoming AGM will be a chance for shareholders to question the board on key matters, such as CEO remuneration or any other issues they might have and revisit their investment thesis with regards to the company.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 3 warning signs (and 2 which are significant) in Asia Cassava Resources Holdings we think you should know about.

Important note: Asia Cassava Resources Holdings is an exciting stock, but we understand investors may be looking for an unencumbered balance sheet and blockbuster returns. You might find something better in this list of interesting companies with high ROE 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.