Vesting of 2022 Conditional Share Awards
Serabi Gold plc is excited to announce the recent vesting of Conditional Share Awards linked to the 2022 fiscal year, as approved by the Board of Directors. This initiative, part of the company’s Long Term Incentive Plan (LTIP), highlights the organization’s commitment to incentivize performance among its key personnel.
Performance Metrics for Share Awards
The journey towards this milestone involved assessing the performance against several key financial targets that reflect shareholder interests. Specifically, the awards, totaling 482,528 new ordinary shares collectively, hinged on performance metrics such as Total Shareholder Return (TSR), Return on Capital Employed (ROCE), and Return on Sales (ROS). These assessments span a rigorous three-year period to ensure alignment with both strategic goals and shareholder value.
Detailed Performance Criteria
To provide clarity on the performance hurdles:
- 40% of the awards depended on achieving a TSR that would match or exceed the BMO junior gold index by a specific factor.
- 30% was contingent on meeting a ROCE threshold exceeding 1.05 times the Weighted Average Cost of Capital (WACC), with full vesting only occurring at 1.2 times WACC.
- The remaining 30% required the ROS to surpass the average budget by 10% or more, emphasizing the company’s commitment to operational excellence.
Cash Settlement and Future Steps
In light of the Group's strong financial standing and a desire to limit the issuance of new ordinary shares, the Board chose to settle the awards in cash rather than stock. This decision further indicates their strategic intent to manage share dilution while ensuring that executives are rewarded appropriately.
The cash settlement was calculated based on the 20 Day Volume Weighted Average Price of the ordinary shares, which stood at £1.52 on the day preceding this announcement. Consequently, two notable executives, Mr. Hodgson and Mr. Howlin, will transition their awards into cash payments of £341,356 and £104,956, respectively, post-tax adjustments.
Shareholder Engagement and Future Purchases
Demonstrating a personal commitment to the company, CEO Mike Hodgson made a notable market purchase of 45,000 shares at £1.69 shortly after the announcement. This act underscores the alignment of management and shareholder interests, with Mr. Hodgson’s total shareholding now representing 0.18% of the company’s shares in circulation.
Company Overview
Serabi Gold plc, a dedicated gold exploration and production company, focuses on the rich Tapajós region in northern Brazil. The company has established a solid production base through its Palito Complex and is ambitiously pursuing the Coringa Gold project to significantly increase output in the future. Additionally, a recent discovery of a copper-gold porphyry enhances its exploration portfolio.
Frequently Asked Questions
What are Conditional Share Awards?
Conditional Share Awards are a form of equity compensation that gives employees the right to receive shares after meeting certain performance criteria.
How does the LTIP benefit shareholders?
The LTIP incentivizes long-term performance and alignment between management's decisions and shareholder interests, potentially enhancing company value.
Who is the CEO of Serabi Gold plc?
The CEO of Serabi Gold plc is Michael Hodgson, who plays a key role in strategic decisions and shareholder relations.
What is the Coringa Gold project?
The Coringa Gold project is a significant development initiative aimed at boosting Serabi Gold's production capability and strengthening its market position.
How can I contact Serabi Gold plc?
For inquiries, you may reach Michael Hodgson, CEO, at +44 (0)20 7246 6830 or via email at contact@serabigold.com.
