Key Insights

• China Maple Leaf Educational Systems' Annual General Meeting to take place on 30th of January
• Total pay for CEO Sherman Jen includes CN¥3.02m salary
• Total compensation is 85% above industry average
• China Maple Leaf Educational Systems' three-year loss to shareholders was 87% while its EPS was down 51% over the past three years

The underwhelming share price performance of China Maple Leaf Educational Systems Limited (HKG:1317) in the past three years would have disappointed many shareholders. In addition, the company's per-share earnings growth is not looking good, despite growing revenues. In light of this performance, shareholders will have a chance to question the board in the upcoming AGM on 30th of January, where they can impact on future company performance by voting on resolutions, including executive compensation. Here's why we think shareholders should hold off on a raise for the CEO at the moment.

View our latest analysis for China Maple Leaf Educational Systems

How Does Total Compensation For Sherman Jen Compare With Other Companies In The Industry?

Our data indicates that China Maple Leaf Educational Systems Limited has a market capitalization of HK$743m, and total annual CEO compensation was reported as CN¥3.0m for the year to August 2023. That's a notable decrease of 11% on last year. Notably, the salary of CN¥3.0m is the entirety of the CEO compensation.

In comparison with other companies in the Hong Kong Consumer Services industry with market capitalizations under HK$1.6b, the reported median total CEO compensation was CN¥1.6m. Hence, we can conclude that Sherman Jen is remunerated higher than the industry median. Furthermore, Sherman Jen directly owns HK$381m 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 82% of total compensation out of all the companies we analyzed, while other remuneration made up 18% of the pie. Speaking on a company level, China Maple Leaf Educational Systems prefers to tread along a traditional path, disbursing all compensation through a salary. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

China Maple Leaf Educational Systems Limited's Growth

China Maple Leaf Educational Systems Limited has reduced its earnings per share by 51% a year over the last three years. In the last year, its revenue is up 16%.

Investors would be a bit wary of companies that have lower EPS But in contrast the revenue growth is strong, suggesting future potential for EPS growth. It's hard to reach a conclusion about business performance right now. This may be one to watch. 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 China Maple Leaf Educational Systems Limited Been A Good Investment?

The return of -87% over three years would not have pleased China Maple Leaf Educational Systems Limited shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

To Conclude...

China Maple Leaf Educational Systems pays CEO compensation exclusively through a salary, with non-salary compensation completely ignored. The returns to shareholders is disappointing along with lack of earnings growth, which goes some way in explaining the poor returns. In the upcoming AGM, shareholders will get the opportunity to discuss any issues with the board, including those related to CEO remuneration and assess if the board's plan is in line with their expectations.

CEO pay is simply one of the many factors that need to be considered while examining business performance. We did our research and identified 6 warning signs (and 3 which don't sit too well with us) in China Maple Leaf Educational Systems we think you should know about.

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.