134
IMI plc
SECTION 4 – CAPITAL STRUCTURE AND FINANCING COSTS
Continued
4.7.6
Share-based payment charge for the year
The total expense recognised for the year arising from share-based payments
was £4.4m (2013: £8.5m) which comprises a charge of £14.4m (2013: £9.8m)
for the year offset by a credit of £10.0m (2013: £1.3m) in respect of lapses.
£4.9m (2013: £6.1m) of the total charge and £3.3m (2013: £0.4m) of the total
credit is in respect of options granted to directors.
4.7.7
Share-based payment valuation
methodology
The fair value of services received in return for share options granted are
measured by reference to the fair value of share options granted, based on a
Black-Scholes option pricing model. The assumptions used for grants in 2014
included a dividend yield of 2.8% (2013: 2.1%), expected share price volatility
of 31% (2013: 38%), a weighted average expected life of 3.5 years (2013:
3.5 years) and a weighted average interest rate of 1.1% (2013: 0.5%). The
expected volatility is wholly based on the historical volatility (calculated based
on the weighted average remaining life of the share options), adjusted for any
expected changes to future volatility due to publicly available information.
4.7.8
Other share-based payment disclosures
The weighted average remaining contractual life for the share options
outstanding as at 31 December 2014 is 7.24 years (2013: 7.15 years)
and the weighted average fair value of share options granted in the
year at their grant date was £8.03 (2013: £7.56).
The weighted average share price at the date of exercise of share
options exercised during the year was £14.68 (2013: £13.12).
4.8
Non-controlling interests
Non-controlling interests are recorded as reductions from the income and
equity recorded in the Group’s financial statements. In accordance with IFRS,
these arise because if the Group controls an operation, it accounts for that
operation as if the Group were the only party holding an interest in it, but in
spite of this control, when other parties have an interest in the operation,
that interest should be reflected.
The deduction from income and equity therefore reflects the reduction in
the Group’s interest resulting from the third party’s interest.
Shanghai
CCI
SLP
Total
£m
£m
£m
Non-controlling interests as at
1 January 2014
2.7
43.9
46.6
Profit for the year attributable to
non-controlling interests
-
2.8
2.8
Dividends paid to
non-controlling interests
(0.2)
-
(0.2)
Income earned by partnership
(4.4)
(4.4)
2014 movement in
non-controlling interest
(0.2)
(1.6)
(1.8)
Non-controlling interest as
at 31 December 2014
2.5
42.3
44.8
The non-controlling interest denoted Shanghai CCI in the above table
represents the 30% ownership interest in the ordinary shares of Shanghai
CCI Power Control Equipment Co Limited held by Shanghai Power Station
Auxiliary Equipment Works Co Limited.
The non-controlling interest denoted SLP relates to an interest in the IMI
Scottish Limited Partnership which was owned by the IMI Pension Fund
(‘The Fund’), which provided the Fund with a conditional entitlement to receive
income of £4.4m per annum unless the Group has not paid a dividend in the
prior year or the Fund was fully funded. As referred to in section 4.5.2, during
the year the IMI Pension Fund commenced winding up procedures and the
relevant liabilities were transferred to one of two new funds, IMI 2014 Deferred
Fund and IMI 2014 Pensioner Fund (together ‘The Funds’). The interest in the
SLP is now held jointly by the Funds and will continue to provide income of
£4.4m per annum unless the Group has not paid a dividend in the prior year
or the Funds are fully funded.
