2014 Registration Document and Annual Financial Report - page 229

5
Financial Statemements
Consolidated Financial Statements and Notes
The main data and assumptions used for the fair value calculations are as follows:
Plan 14 Plan 15 Plan 16 Plan 17 Plan 18 Plan 19 Plan 20
Accor share price at the option grant date
€70.95 €70.45 €62.35 €47.10 €37.12 €25.49 €41.47
Option exercise price
€68.65 €71.72 €60.44 €46.46 €42.70 €27.45 €40.20
Expected volatility
(1)
31.73% 31.60% 27.57% 27.87% 26.72% 31.91% 33.96%
Contractual life of the options
7 years 7 years 8 years 7 years 7 years 8 years 8 years
Expected share yield
(2)
3.94% 4.25% 4.15% 3.84% 4.03% 2.63% 2.29%
Dividend rate
(3)
2.29% 2.29% 2.29% 2.53% 2.53% 2.53% 3.24%
Fair value of options
(4)
€20.38 €19.36 €16.66 €11.55
€7.00
€5.78 €10.28
Plan 21 Plan 22 Plan 23 Plan 24 Plan 25 Plan 26 Plan 27
Accor share price at the option grant date
€41.47 €32.19 €31.96 €31.96 €26.55 €26.55 €30.88
Option exercise price
€40.20 €30.49 €31.72 €31.72 €26.41 €26.41 €30.13
Expected volatility
(1)
33.96% 34.99% 35.74% 35.74% 39.71% 39.71% 37.16%
Contractual life of the options
8 years 8 years 8 years 8 years 8 years 8 years 8 years
Expected share yield
(2)
2.29% 1.98% 2.90% 2.60% 1.67% 1.67% 1.20%
Dividend rate
(3)
3.24% 2.22% 2.19% 2.19% 2.42% 2.42% 3.04%
Fair value of options
(4)
€9.44
€9.25
€9.40
€8.89
€7.88
€6.50
€6.30
(1) Weighted volatility based on exercise periods.
(2) Expected share yield based on exercise periods.
(3) For the plans granted before 2011, the dividend rate used to measure the fair value of options correspond to the average payout rate for the previous two, three
or four years. For the plans granted in 2011, this rate corresponds to the expected payout rate for 2011. For the plans granted since 2012, this rate corresponds
to the payout rate for the previous year.
(4) Fair value of options based on exercise periods.
Maturities of stock options
The Group has decided to base the exercise dates of stock options
under these plans on observed exercise dates under previous
plans. The same principle has been applied to all plans, as follows:
ƒƒ
35% of options exercised after 4 years;
ƒƒ
20% of options exercised after 5 years;
ƒƒ
35% of options exercised after 6 years;
ƒƒ
5% of options exercised after 7 years – 10% for plans 12, 13,
14, 15, 17 and 18;
ƒƒ
5% of options exercised after 8 years.
Maturities stock options correspond to the options’ expected lives.
Share price volatility
The Group has chosen to apply a volatility rate calculated by
reference to historical data for the eight years preceding the grant
date. Different volatility rates have been applied, calculated from
granted date, to each maturity as presented above.
Performance share plans
2011 Plan
On April 4, 2011, Accor granted 249,107 performance shares to
senior executives and certain employees. Of these:
ƒƒ
20,450 have a three-year vesting period followed by a two-year
lock-up period;
ƒƒ
190,331 have a two-year vesting period followed by a two-year
lock-up period;
ƒƒ
38,326 have a four-year vesting period with no subsequent
lock-up period.
The performance shares are subject to vesting conditions based
on business revenue, EBIT and operating cash flow for each of
the years 2011 and 2012. Targets have been set for annual growth
in relation to the budget over the next two years, with interim
milestones, and a certain percentage of the shares vest each year
as each milestone is met.
The cost of the performance share plan – corresponding to the fair
value of the share grants – amounted to €7.6 million at April 4, 2011
and was being recognized on a straight-line basis over the vesting
period under “Employee benefits expense” with a corresponding
adjustment to equity.The fair value of the share grants was measured
as the average of the Accor share prices for the twenty trading
days preceding the grant date multiplied by the number of shares
granted under the plan.
In 2011, the performance criteria were met. Plan costs recognized
in 2011 amounted to €2.5 million.
In 2012, the performance criteria were almost met. Plan costs
recognized in 2012 amounted to €3.3 million.
At December 31, 2013, plan costs recognized amounted to €1million.
In 2014, plan costs recognized amounted to €0.2 million.
Registration Document 2014
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