annual report 2011

IOOF | annual report 2011
Notes to the financial statements (cont’d)
For the year ended 30 June 2011
Basic earnings per share
The earnings and weighted average number of ordinary shares used in the calculation of basic earnings per share are as follows:
$’000 $’000
Profit for the period attributable to owners of the Company 99,489 77,371
Earnings used in the calculation of basic EPS 99,489 77,371
Weighted average number of ordinary shares No. ’000 No. ’000
Weighted average number of ordinary shares (basic) 230,676 229,922
Effect of unvested performance rights 580 683
Effect of share options on issue 654 309
Weighted average number of ordinary shares (diluted) 231,910 230,914
At 30 June 2011, 1,164,122 options were excluded from the diluted weighted average number of ordinary shares calculation as their
effect would not have been dilutive.
The average market value of the Company’s shares for purposes of calculating the dilutive effect of share options was based on
quoted market prices for the period during which the options were outstanding.
31 Share-based payments
The Group operates a number of employee share and option
schemes under the IOOF Executive Share Option Plan, the
IOOF Executive Performance Share Plan and the Non-Executive
Director Deferred Share Purchase Plan and the IOOF Deferred
Share Plan for the Managing Director.
IOOF Executive Share Option Plan
The Group has an ownership-based compensation scheme
for executives and senior employees of the Group. The
establishment of the employee share option plans were
approved by the Board of Directors.
Selected employees may be granted options which entitle
them to purchase ordinary fully paid shares in IFL at a price
fixed at the time the options are granted. Voting and dividend
rights will be attached to the unissued ordinary shares when
the options have been exercised. Options may be exercised at
any time from the date of vesting to the date of their expiry.
The Remuneration and Nominations Committee regards the
grant of options to employees as an appropriate long-term
incentive and retention component of total remuneration for
executives and senior employees. It is expected that future
annual grants of options will be made, the vesting of which will
be subject to attainment of appropriate performance hurdles
and on the basis of continuing employment with the Group.
Options granted under the plan carry no dividend or voting
rights. All plans are equity-settled.
IOOF Executive Performance Share Plan
The IOOF Executive Performance Share Plan is the vehicle used
to deliver equity based incentives to executives and senior
employees of the Group.
Each employee receives ordinary shares of the Company on
vesting of the performance rights. No amounts are paid or
payable by the recipient on receipt of the performance rights
or on vesting. The performance rights carry neither rights to
dividends nor voting rights prior to vesting.
The Remuneration and Nominations Committee regards the
grant of performance rights to employees as an appropriate
long-term incentive and retention component of total
remuneration for executives and senior employees. It is
expected that future annual grants of performance rights will
be made, the vesting of which will be subject to attainment
of appropriate performance hurdles and on the basis of
continuing employment with the Group.
Performance rights granted under the plan carry no dividend
or voting rights. All plans are equity-settled.
Non-Executive Director (NED) Share Purchase
Plan
Each Non-Executive Director is eligible to participate in the
NED Share Purchase Plan. The NED Share Purchase Plan is a
NED salary sacrifice plan and is not captured as a share based
payment expense.
Deferred Share Plan
A Short Term Incentive (STI) mandatory deferral program was
implemented from 2010, with equity deferral relating to 50% of
the Managing Directors’ STI for that year. In 2011, one third of
the Managing Directors’ STI was deferred into equity.
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