4.0 - Imperial

2009 2008
Rm
Rm
Financial Statements
19a. Other reserves (continued)
Share appreciation rights scheme – June 2009
Volatility (%) 40,00
Weighted average share price (Rand) 55,32
Weighted average exercise price (Rand) 55,32
Expected life (years) 3,25
Average risk-free rate (%) 8,35
Expected dividend yield (%) 2,76
Deferred bonus plan – June 2009
Volatility (%) 40,00
Weighted average share price (Rand) 55,32
Weighted average exercise price (Rand)
Expected life (years) 3,25
Average risk-free rate (%) 8,35
Expected dividend yield (%) 2,76
The volatilities were determined by calculating the historical volatility of the company’s
share price over the previous five years. The expected life is determined by the rules of
the schemes which dictate the expiry date.
The current financial year’s movement raised in the income statement is detailed in note 28.
Lereko transaction
Imperial entered into a black economic empowerment transaction with Lereko Mobility
(Pty) Limited. The substance of this transaction was to grant the Lereko Consortium
a call option over the delivery of a variable number of shares on 15 June 2015. This
would be determined by the amount by which the value of 14 516 617 Imperial
Holdings Limited ordinary shares exceeded the settlement of the funding.
The Monte Carlo simulation method was used to value this call option evaluating
100 000 potential outcomes for the call option granted on 15 June 2005 and vesting
on 15 June 2015. The start price was R96,85.
19b. Translation reserves
Opening balance at beginning of year 757 490
Movements in translation reserves
Intangible assets (37) 112
Investments, loans, associates and joint ventures (15) 67
Property, plant and equipment (262) 294
Transport fleet (136) 128
Leasing assets 95
Vehicles for hire (1) 1
Deferred taxation (11) 15
Inventories (164) 170
Current taxation 13 (17)
Trade and other receivables (255) 469
Cash resources (169) 344
Minorities 14 (21)
Retirement benefit obligations 34 (63)
Interest-bearing borrowings 148 (890)
Insurance and investment contracts 2 (2)
Provisions for liabilities and other charges 40 (52)
Trade and other payables 247 (437)
205 703
Direct transfer from retained earnings 5
Unbundled to shareholders 54
Closing balance at end of year 210 757
Imperial holdings limited Annual Report 2009 97