Holiday Inn 2014 Annual Report Download - page 87

By focusing on both net rooms growth and RevPAR growth, we are rewarding the balanced approach to growth that will support the
long-term increase in shareholder value.
These performance measures are also used for the 2013/15 and 2014/16 LTIP cycles, granted in 2013 and 2014 respectively. Threshold,
target and maximum opportunity for the 2012/14 cycle is shown in the graph below, along with actual achievement for 2014.
Performance
measure Weighting
Maximum
opportunity
at grant as a
% of salary
Achievement relative to maximum
for that measure
% of
maximum
opportunity
vested Commentary
No
payout Threshold Target Maximum
Relative net
rooms growth 25% 51.25% 0% Outcome below average of comparator group
Relative RevPAR
growth 25% 51.25% 6.1% Outcome slightly above average of comparator group
Relative TSR 50% 102.5% 50.0% Outperformed index by 15.8%
Maximum as % salary at grant 205% % of maximum opportunity vested 56.1%
Actual No payout
Performance was below the average of the comparator group on the relative net rooms growth measure and therefore this element
will not vest.
Outcome for 2012/14 cycle (audited information)
This cycle will vest on 18 February 2015, as follows:
Executive Director
Maximum opportunity at grant
(number of shares)
% of maximum opportunity
vested
Outcome (number of shares
awarded at vest)
Total value of award1
£000
Richard Solomons 103,722 56.1 58,188 1,425
Paul Edgecliffe-Johnson 29,322 56.1 16,449 403
Kirk Kinsell268,463 56.1 38,407 941
Tracy Robbins 59,270 56.1 33,250 814
Tom Singer377,684 56.1 29,053 712
1 As shown in the single figure of remuneration. Share price used of 2,449p is the average over the final quarter of 2014.
2 In line with the DR Policy, the Remuneration Committee determined that Kirk Kinsell would retain his 2012/14 LTIP award in accordance with and subject to
the terms of the LTIP Plan rules, as the performance period for this award was completed when Kirk Kinsell resigned effective as of 13 February 2015.
3 The Remuneration Committee determined that the 2012/14 LTIP award would vest in line with the terms of the LTIP Plan rules on a pro-rated basis for the
proportion of the performance period in which Tom Singer remained in employment. This award will be released on the normal vesting date and only to the extent
the performance conditions were fulfilled.
Net rooms and RevPAR growth were measured by reference to the three years ending 30 September 2014; TSR was measured by
reference to the three years ending 31 December 2014.
Pensions
Pension benefit: the value of Company contributions to pension plans and any cash allowances paid in lieu of pension contributions.
As published in the 2013 Annual Report, the Group commenced the phasing out of potential enhanced early retirement terms related
to those defined benefit pensions in 2014 (see page 87 for further details). In addition, the planned cash out offer was made to the
participants of the unfunded, unregistered, defined benefit top-up arrangement, ICETUS, which had previously provided the balance of
any benefit accrual that was restricted in the tax-registered plan due to the annual or lifetime allowances. Payments associated with the
cash out were made in the financial year and are therefore disclosed appropriately in this year’s Annual Report.
For 2014, the pension benefits for Richard Solomons include the payment of a cash out value in respect of his accrued, unfunded
ICETUS benefit. Richard Solomons received a one-off gross cash payment of £9,405,362 in lieu of any future entitlement to ICETUS
benefits. An amount of £6,447,000 in respect of his ICETUS benefit was included as part of the disclosure of his total accrued benefits
in the 2013 Directors’ Remuneration Report based on the HM Revenue & Customs methodology of valuing pensions at 20 times their
annual amounts, hence only the balance in excess of this (i.e. £2.958m) is shown in the single figure table. The actual payment was
greater than 20 times the annual pension because the ICETUS benefit was valued using a more accurate actuarial calculation method,
in line with that used for valuing the total ICETUS liabilities for accounting purposes. Following the cash out, Richard Solomons has no
future entitlement to any benefit from ICETUS.
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STRATEGIC REPORT GOVERNANCE
GROUP FINANCIAL STATEMENTS
PARENT COMPANY FINANCIAL STATEMENTS
ADDITIONAL INFORMATION