We Discuss Why Uzma Berhad's (KLSE:UZMA) CEO Compensation May Be Closely Reviewed

Uzma Berhad (KLSE:UZMA) has not performed well recently and CEO Kamarul Bin Muhamed will probably need to up their game. At the upcoming AGM on 14 December 2022, shareholders can hear from the board including their plans for turning around performance. 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. From our analysis, we think CEO compensation may need a review in light of the recent performance.

Check out our latest analysis for Uzma Berhad

How Does Total Compensation For Kamarul Bin Muhamed Compare With Other Companies In The Industry?

At the time of writing, our data shows that Uzma Berhad has a market capitalization of RM192m, and reported total annual CEO compensation of RM1.1m for the year to June 2022. We note that's a small decrease of 6.3% on last year. We note that the salary portion, which stands at RM655.0k constitutes the majority of total compensation received by the CEO.

In comparison with other companies in the industry with market capitalizations under RM879m, the reported median total CEO compensation was RM1.3m. From this we gather that Kamarul Bin Muhamed is paid around the median for CEOs in the industry.

On an industry level, roughly 68% of total compensation represents salary and 32% is other remuneration. There isn't a significant difference between Uzma Berhad and the broader market, in terms of salary allocation in the overall compensation package. If salary is the major component in total compensation, it suggests that the CEO receives a higher fixed proportion of the total compensation, regardless of performance.

Uzma Berhad's Growth

Over the last three years, Uzma Berhad has shrunk its earnings per share by 30% per year. In the last year, its revenue is up 1.9%.

Few shareholders would be pleased to read that EPS have declined. The fairly low revenue growth fails to impress given that the EPS is down. 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 Uzma Berhad Been A Good Investment?

The return of -36% over three years would not have pleased Uzma Berhad shareholders. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

Along with the business performing poorly, shareholders have suffered with poor share price returns on their investments, suggesting that there's little to no chance of them being in favor of a CEO pay raise. At the upcoming AGM, they can question the management's plans and strategies to turn performance around and reassess their investment thesis in regards to the company.

CEO compensation is an important area to keep your eyes on, but we've also need to pay attention to other attributes of the company. In our study, we found 2 warning signs for Uzma Berhad you should be aware of, and 1 of them is potentially serious.

Important note: Uzma 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here