| NOTES TO THE FINANCIAL STATEMENTS — NOTE 25 |
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| Equity-settled share-based employee remuneration
On 1 January 2014, the group implemented a long-term employee incentive scheme, the conditional unit plan (CUP), which consists of two components — performance shares and retention shares. Both the performance and retention components of the scheme
are settled with Hyprop shares.
The terms and conditions of the long-term employee incentive scheme were approved at the Hyprop annual general meeting on 5 December 2013. |
| 25.1 |
Performance shares |
| |
In terms of the CUP, fully paid awards are made on an annual basis, comprising performance shares and retention shares.
The split between performance shares and retention shares is 70%:30% for all participants.
| The performance conditions for the shares allocated as performance shares are as follows: |
| • |
Growth in distribution per share relative to a peer group (weighting 40%) |
| • |
Share price performance relative to a peer group (weighting 40%) |
| • |
Strategic component, which will be determined by the remuneration committee in line with the prevailing circumstance and projects at the time of the award (weighting 20%). |
Each of the performance conditions will be measured over a three-year performance period. Participants must be employed until the end of the vesting period to be eligible for the award. |
| 25.2 |
Retention shares |
| |
Retention shares vest after five years, provided the participant is still employed by the group. |
| 25.3 |
Reconciliation of shares allocated in terms of the CUP
| |
Number of
performance
shares |
|
Number of
retention
shares |
|
| Unvested at 30 June 2014 |
107 563 |
|
46 100 |
|
| Granted |
110 422 |
|
47 324 |
|
| Forfeited |
(3 368) |
|
(1 443) |
|
| Unvested at 30 June 2015 |
214 617 |
|
91 981 |
|
| Granted |
78 282 |
|
33 549 |
|
| Forfeited |
(7 955) |
|
(3 757) |
|
| Vested |
(1 356) |
|
(234) |
|
| Unvested at 30 June 2016 |
283 588 |
|
121 539 |
|
| |
Performance
shares |
|
Retention
shares |
|
| Tranche 1 |
|
|
|
|
| Grant date |
1 January 2014 |
|
1 January 2014 |
|
| Vesting period ends |
31 December 2016 |
|
31 December 2018 |
|
| Fair value of options at grant date |
R61,50 |
|
R54,77 |
|
| Share price at grant date |
R76,50 |
|
R76,50 |
|
| The inputs used in the measurement of the fair value at grant date were as follows: |
|
|
|
|
| Expected life |
3 years |
|
5 years |
|
| Volatility |
20,00% |
|
20,00% |
|
| Interest-free rate after taxation of 28% |
5,75% |
|
5,75% |
|
| Dividend yield |
5,79% |
|
5,79% |
|
| Tranche 2 |
|
|
|
|
| Grant date |
1 July 2014 |
|
1 July 2014 |
|
| Vesting period ends |
30 June 2017 |
|
30 June 2019 |
|
| Fair value of options at grant date |
R65,55 |
|
R58,12 |
|
| Share price at grant date |
R79,51 |
|
R79,51 |
|
| The inputs used in the measurement of the fair value at grant date were as follows: |
|
|
|
|
| Expected life |
3 years |
|
5 years |
|
| Volatility |
20,00% |
|
20,00% |
|
| Interest-free rate after taxation of 28% |
5,88% |
|
5,88% |
|
| Dividend yield |
6,01% |
|
6,01% |
|
| Tranche 3 |
|
|
|
|
| Grant date |
1 July 2015 |
|
1 July 2015 |
|
| Vesting period ends |
30 June 2018 |
|
30 June 2020 |
|
| Fair value of options at grant date |
R105,76 |
|
R96,68 |
|
| Share price at grant date |
R121,00 |
|
R121,00 |
|
| The inputs used in the measurement of the fair value at grant date were as follows: |
|
|
|
|
| Expected life |
3 years |
|
5 years |
|
| Volatility |
20,00% |
|
20,00% |
|
| Interest-free rate after taxation of 28% |
5,97% |
|
5,97% |
|
| Dividend yield |
4,49% |
|
4,49% |
|
The executive directors were allocated the following percentages of the total shares allocated:
| |
Pieter Prinsloo
(CEO) |
|
Laurence Cohen
(FD) |
|
| Tranche 1 |
|
|
|
|
| Performance shares |
19% |
|
10% |
|
| Retention shares |
19% |
|
10% |
|
| Tranche 2 |
|
|
|
|
| Performance shares |
20% |
|
11% |
|
| Retention shares |
20% |
|
11% |
|
| Tranche 3 |
|
|
|
|
| Performance shares |
20% |
|
11% |
|
| Retention shares |
20% |
|
11% |
|
| The charge to the statement of profit or loss and other comprehensive income for the year ended 30 June 2016 amounted to R9,9 million (2015: R6,7 million). As the above are equity-settled shared-based payments, the accounting treatment recognises the share-based payments in profit or loss on a straight-line basis over the vesting period, with a corresponding credit to equity. |
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| NOTES TO THE FINANCIAL STATEMENTS — NOTE 25 |
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