Experian 2008 Annual Report Download - page 130

Download and view the complete annual report

Please find page 130 of the 2008 Experian annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 148

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148

128 Experian Annual Report 2008
35. Share-based payment arrangements (continued)
(iii) Reconciliation of share awards outstanding
Number of awards
2008
m
Awards in respect of shares in Experian Group Limited outstanding at 1 April 2007 24.6
New grants 2.1
Forfeitures (2.5)
Vesting (0.5)
Awards in respect of shares in Experian Group Limited outstanding at 31 March 2008 23.7
Number of awards
2007
m
Awards in respect of shares in GUS plc outstanding at 1 April 2006 5.0
New grants 2.8
Vesting (4.2)
Awards in respect of shares in GUS plc outstanding at demerger 3.6
Less: awards rolled over into Home Retail Group share plans (0.7)
GUS share awards to Experian participants at demerger 2.9
Conversion to Experian awards at the average roll-over ratio of 1.78 2.3
Experian equivalent roll-over awards 5.2
Awards in respect of shares in Experian Group Limited on or after demerger 19.8
Forfeitures (0.4)
Awards in respect of shares in Experian Group Limited outstanding at 31 March 2007 24.6
For Experian share award plans there were 2,089,674 (2007: 19,780,729, including an award of 757,747 to a director) shares
granted in the year, with a weighted average award fair value of £5.67 (2007: £5.20). For former GUS plans there were
2,814,465 shares granted in the year ended 31 March 2007, with a weighted average award fair value of £6.74.
(c) Modification of GUS awards to Experian participants
(i) Details of modification
Prior to demerger, Experian participants held share incentive grants with entitlement to GUS share distributions. On demerger,
the majority of outstanding options and awards were rolled over into plans with entitlement to Experian Group Limited
share distributions. As detailed below, the quantity and exercise price of options and awards were modified to maintain a
compensation equivalent to that of the original GUS grants. The incremental fair value of the modification, recognised in
the year ended 31 March 2007, was US$8m which was reported as an exceptional charge. The incremental fair value results
primarily from an assumption in respect of the higher volatility of the Experian share price.
(ii) Information relating to modified share options and awards
In the year ended 31 March 2007, a total of 16.9m GUS options were rolled over into 30.0m Experian Group Limited options.
A Black-Scholes model was used to determine the fair value of GUS and Experian Group Limited options for modified grants
and the weighted average estimated fair values and the inputs into these models were as follows:
GUS Experian
awards awards
Share price on modification date (£) 9.90 5.62
Exercise price (£) 8.08 4.57
Expected volatility 25.6% 27.6%
Expected dividend yield 3.7% 3.7%
Risk-free rate 4.9% 4.9%
Expected option life to exercise 3.5 years 3.5 years
Fair value (£) 2.71 1.64
In the year ended 31 March 2007, awards in respect of 4.9m GUS shares with a weighted average fair value of £8.14 per share
were rolled over into 8.7m Experian shares with a weighted average fair value of £4.67 per share.
Notes to the Group financial statements continued