2007 Reference document (PDF) - Valeo

3 Consolidated
PAGE 110
fi nancial statements at December 31, 2007
Notes to consolidated financial statements
2007 Reference document - VALEO
Free shares and stock
options
2006
March November
Free shares and stock
options
Share price at date of grant (euros) 31.79 30.16
Expected volatility (%) - and 24.6 - and 29.0
Risk-free rate (%) 3.3 and 3.5 3.9
Dividend rate (%) 3.2 3.2
Duration of the option (years) 2.25 and 4 3 and 4
Fair value of the equity instrument (euros) 29.28 and 4.92 26.32 and 5.54
Free shares and stock
options
2005 2004
Subscription options
and stock options
Share price at date of grant (euros) 31.46 29.77
Expected volatility (%) - and 26.4 25.80
Risk-free rate (%) 2.9 and 3.1 3.1
Dividend rate (%) 3.1 3.4
Duration of the option (years) 2.25 and 4 4
Fair value of the equity instrument (euros) 28.65 and 5.52 5.67 and 4.26
Expected volatility is determined as being the implicit volatility at
the date of grant of the plan. The maturity of four years used for
stock option and stock subscription plans corresponds to the period
for which the availability of options is restricted by tax legislation,
which is deemed to represent the duration of the option.
An expense of 11 million euros was booked in 2007 (including
employer taxes in respect of stock options and free share awards),
unchanged from 2006 (expense of 7 million euros in 2005).
4.8.2. Additional paid-in capital
Additional paid-in capital represents the net amount received, either
in cash or in assets, in excess of the par value on issuance of Valeo
shares.
4.8.3. Translation adjustment
The translation adjustment reserve at December 31, 2007 primarily
includes gains and losses arising from the translation of the net
assets of Valeo’s Brazilian, Japanese, Mexican and South Korean
subsidiaries.
4.8.4. Retained earnings
Retained earnings include net income for the year amounting to
88 million euros (before appropriation of the dividend to be proposed
at the Annual General Meeting).
4.8.5. Dividends per share
The balance of the parent company’s distributable retained earnings
amounts to 1,592 million euros, before appropriation of 2007 net
income (1,589 million euros in 2006 and 1,593 million euros
in 2005).
Dividends paid in 2007 amounted to 85 million euros, representing
1.10 euro per share.
Dividends paid in 2006 and 2005 respectively totaled 84 million
euros and 91 million euros, also representing 1.10 euro per share
for both years. A dividend of 1.20 euro per share for the year ended
December 31, 2007 will be proposed at the Annual General Meeting.
This distribution is not recognized in accrued liabilities in the financial
statements at December 31, 2007.
4.8.6. Treasury stock
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At December 31, 2007, Valeo owns 1,432,804 of its own shares,
representing 1.83% of share capital, versus 686,704 shares
(0.89%) at December 31, 2006 and 807,704 shares (1.04%)
at December 31, 2005.
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