The Group operates a number of share-based payment schemes.
2020 long-term incentive plans (2020 LTIP)
In 2016, Kindred Group’s Board approved a long-term incentive plan for all employees and the Executive Management team (2020 All Employee Share Plan and 2020 Executive Management Incentive Scheme). As a result, 1,481,866 share awards were granted to existing employees on 3 October 2016, with subsequent grants made pro rata to new employees. The awards were subject to achieving a business performance target for EBITDA in the 2020 financial year and continued employment.
Awards under this scheme vested in full on 31 March 2021. The assessment of the actual business performance against the target condition, EBITDA, in the 2020 financial year confirmed that this had been achieved at greater than 100 per cent.
2021 All Employee Share Plan (2021 AESP)
At the end of 2020, Kindred Group’s Board approved the 2021 AESP, a new all employee share plan linked to the three-year strategic cycle of the business. The scheme is aimed at all permanent employees of the Group, with the exception of the Executive Management team. Initial grants will be made to all eligible employees on an annual basis in the financial years 2021 to 2023 and will vest after a 24-month period. The first initial grant was made on 1 March 2021. Subsequent half-year grants will be made six months after the initial grant, only to new employees within that six-month period, and these will vest after an 18-month period to coincide with the initial grant for that year. All grants are subject to the achievement of Group EBITDA targets and continued employment.
Performance Share Plan (PSP)
The introduction of the Group PSP, regarding the granting of future performance share rights to senior management and key employees, was approved at the 2013 AGM.
The PSP performance measures are non-market-based conditions providing participants with a high degree of alignment to the Group’s performance. They are based on continued employment and achieving business performance targets over three financial years. The targets set are EBITDA, Gross contribution (revenue, less cost of sales, less marketing costs), and free cash flow per share. Grants made in each year have targets measured on an aggregate basis between the full year of grant and the two successive years so that performance in each financial year will be important. Aggregated performance against the targets and the resulting allocation of PSP awards are disclosed after the full year of vesting.
On 2 June 2021, the 2018 PSP grants vested in full. The assessment of the actual business performance against the target conditions confirmed that all targets over the three financial years 2018-20 had been achieved at greater than 100 per cent.
|
PSP |
2021 Number |
2020 Number |
|
Outstanding at 1 January |
1,932,421 |
1,355,846 |
|
Vested |
-263,620 |
-255,163 |
|
Granted |
543,695 |
1,080,605 |
|
Lapsed |
-119,081 |
-248,867 |
|
Outstanding at 31 December |
2,093,415 |
1,932,421 |
|
2020 LTIP |
2021 Number |
2020 Number |
|
Outstanding at 1 January |
1,213,161 |
1,509,592 |
|
Vested |
-1,189,899 |
– |
|
Granted |
4,375 |
64,081 |
|
Lapsed |
-27,637 |
-360,512 |
|
Outstanding at 31 December |
– |
1,213,161 |
|
2021 AESP |
2021 Number |
2020 Number |
|
Outstanding at 1 January |
– |
– |
|
Vested |
– |
– |
|
Granted |
530,400 |
– |
|
Lapsed |
-80,300 |
– |
|
Outstanding at 31 December |
450,100 |
– |
Dilution effects
227,018 share awards lapsed or were cancelled during 2021. If all share-based programmes are fully exercised, the nominal share capital of Kindred Group plc will increase by a total maximum of GBP 1,589.70 (2020: GBP 1,965.99) by the issue of a total maximum of 2,543,515 ordinary shares (2020: 3,145,582 ordinary shares), corresponding to 1 per cent (2020: 1 per cent) of the capital and votes in Kindred Group.
