Seok Yeoh has been the CEO of YTL Power International Berhad (KLSE:YTLPOWR) since 2018, and this article will examine the executive’s compensation with respect to the overall performance of the company. This analysis will also assess whether YTL Power International Berhad pays its CEO appropriately, considering recent earnings growth and total shareholder returns.
How Does Total Compensation For Seok Yeoh Compare With Other Companies In The Industry?
Our data indicates that YTL Power International Berhad has a market capitalization of RM5.8b, and total annual CEO compensation was reported as RM5.2m for the year to June 2020. Notably, that’s a decrease of 25% over the year before. Notably, the salary which is RM3.06m, represents most of the total compensation being paid.
On comparing similar companies from the same industry with market caps ranging from RM4.1b to RM13b, we found that the median CEO total compensation was RM5.2m. This suggests that YTL Power International Berhad remunerates its CEO largely in line with the industry average. Furthermore, Seok Yeoh directly owns RM99m 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 24% of total compensation out of all the companies we analyzed, while other remuneration made up 76% of the pie. According to our research, YTL Power International Berhad has allocated a higher percentage of pay to salary in comparison to the wider industry. If total compensation veers towards salary, it suggests that the variable portion – which is generally tied to performance, is lower.
YTL Power International Berhad’s Growth
Over the last three years, YTL Power International Berhad has shrunk its earnings per share by 51% per year. It saw its revenue drop 14% over the last year.
Few shareholders would be pleased to read that EPS have declined. This is compounded by the fact revenue is actually down on last year. So given this relatively weak performance, shareholders would probably not want to see high compensation for the CEO. Moving away from current form for a second, it could be important to check this free visual depiction of what analysts expect for the future.
Has YTL Power International Berhad Been A Good Investment?
Given the total shareholder loss of 40% over three years, many shareholders in YTL Power International Berhad are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
As we noted earlier, YTL Power International Berhad pays its CEO in line with similar-sized companies belonging to the same industry. In the meantime, the company has reported declining EPS growth and shareholder returns over the last three years. It’s tough to call out the compensation as inappropriate, but shareholders might not favor a raise before company performance improves.
It is always advisable to analyse CEO pay, along with performing a thorough analysis of the company’s key performance areas. In our study, we found 3 warning signs for YTL Power International Berhad you should be aware of, and 1 of them shouldn’t be ignored.
Important note: YTL Power International Berhad 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. 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.
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