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Performance share plan (PSP)
The PSP scheme is the current active and allocating plan, and is summarised as follows:
Objective:
To promote the achievement of MTN Group’s strategic objectives measured using the
company’s growth in share price and cash flow. Participating employees share in the company’s
achievement of the set financial indicators over three years.
Eligible participants
Date
implemented
Performance
conditions
Last vesting
date Expiry period
All employees at
junior management
level and above
2010 Total
shareholder
return (TSR)
Adjusted free
cash flow
(AFCF)
2020 Not applicable
Details about the PSP
•
•
Share awards are at the discretion of the MTN Group board and the operating entities.
•
•
Participation is limited to managerial employees and those in more senior positions only.
•
•
Performance is measured using TSR and AFCF. An additional service element is applicable for non-
executive participating employees.
•
•
Weightings are attached to each condition based on the seniority of the participant.
•
•
The scheme has a three-year vesting period. Once the shares are vested and the board is satisfied
with the achievement of the performance conditions, participating employees receive either shares
or the cash equivalent if the respective employee instructs the company to dispose of their shares
on the employee’s behalf.
2017 LTI changes
As part of an ongoing review process, we reviewed the performance metrics used to assess the
performance of the PSP scheme. The outcome of this review was approved by the board for
implementation effective for the 2017 share allocation. A summary of these changes is as follows:
Current weightings
New metric weightings
Managerial
Managerial
Performance measure
Staff Executives
Staff Executives
TSR
– JSE Top 25 Index
37,5%
50%
TSR
– MSCI EM Index
1
25%
25%
AFCF
37,5%
50%
Cumulative operating free cash flow
(COFCF)
2
25%
25%
Return on average capital employed
(ROACE)
25%
25%
Service/retention elements
3
25%
0%
25%
25%
1
MCSI Emerging Markets telecoms index measured on common currency, i.e. ZAR.
2
COFCF measured on a constant currency basis at budgeted numbers.
3
Approved for the December 2017 allocation only, to be reviewed on an annual basis.
Remuneration report
continued
92
MTN Group Limited
Integrated Report 2017