Atari 2012 Annual Report Download - page 81

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ANNUAL FINANCIAL REPORT – REGISTRATION DOCUMENT
81
Volatility relates to the propensity of an asset's value to fluctuate significantly. The more an asset's value experiences
substantial changes over a short period of time, the higher its volatility. According to IFRS 2, the period over which
historical fluctuations in the price of the underlying shares is taken into consideration to determine volatility must equal
the expected life of the options. Based on the Group’s dividend history, no dividend is anticipated.
The risk-free interest rate corresponds to the interest rate on government bonds (OAT) with a maturity equal to the
estimated life of the options on the various option grant dates.
19.5. ALLOCATION OF PERFORMANCE SHARES
In Fiscal Year 2011/2012 the Company used the authorizations given at the Extraordinary Shareholders' Meetings of
September 30, 2009 and of September 30, 2011 to allocate rights to performance shares to French employees, certain
officers and executives.
In order for rights to performance shares to vest, their beneficiaries must be part of the Group on the vesting date and
grants are contingent on the achievement of certain performance criteria. After the vesting period, the performance
shares are subject to a two-year lock-up period.
The table below shows a summary of transactions relating to performance shares in FY 2011/2012 and 2010/2011:
The fair value of the rights to performance shares allocated is based on the trading price of the Company’s shares at the
initial allocation date. The weighted fair value of shares granted in Fiscal Year 2008/2009 was €7.96 per share.
The weighted fair value of rights to performance shares allocated in Fiscal Year 2011/2012 was €2.17 per share.
The related expense recognized in the years ended March 31, 2012 and 2011 amounted to €1.7 million. No expense
was recognized for the year ended March 31, 2011.
For the Fiscal Year 2011/2012, the fair value recognized is based on the assumption that 75% of the performance
conditions will be fulfilled.
NOTE 20 – NET FINANCIAL INCOME (EXPENSE)
Principal assumptions 2011-2012 2010-2011 2010-2011 2010-2011
#1 # 1 # 2 # 3
Valuation model Black & Scholes Black & Scholes Black & Scholes Black & Scholes
Price of shares on option grant date
€3,03 €5,26 €3,96 €4,03
Exercise price on option grant date (per share)
€4,00 €5,16 €4,28 €4,00
Expected volatility 72,00%
92,98% 81,30% 72,00%
Risk-free interest rate on grant date 2,38%
2,05% 1,62% 1,17%
Expected dividend rate 0,00%
0,00% 0,00% 0,00%
Fair value of options on grant date €1,25 €3,14 €1,86 €1,93
Year ended
March 31, 2012
Year ended
March 31, 2011
Number of rights to performance shares outstanding at the beginning of the year 223 000 237 731
Rights to performance share allocated during the year
1 937 290 -
Rights to performance shares cancelled
(150 090) -
Performance shares vested
(223 000) - 14 731
Number of rights to performance shares outstanding at the end of the year 1 787 200 223 000
(€ m illion)
Year ended
March 31, 2012
Year ended
March 31, 2011
Interest on bond debt 0.3 (0.5)
Interest on bank debt (3.4) (1.4)
Other 0.4 -
Cost of debt (2.7) (1.9)
Foreign-exchange gains and losses (0.2) (0.2)
Impairment of non-current financial assets 1.0
Other 0.1 (0.1)
Other financial income (expense) (0.1) 0.7
Total (2.8) (1.2)