22 Shareholders’ equity
22.1 Share capital and capital reserve
Holders of ordinary shares are entitled to dividends and to one vote per share at the General Meetings of Shareholders. All payments of the shareholders in excess to the nominal value of the share (CHF 0.10 / share) are classified to capital reserve (share premium).
22.2 Nature and purpose of the equity reserves
22.2.1 Treasury shares
The Position ‘Treasury shares’ comprises the cost of the treasury shares held by the Group. All rights attached to treasury shares are suspended until those shares are reissued.
22.2.2 Translation differences
The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations.
22.3 Movements in shares outstanding
Shares (each share has a nominal value of CHF 0.10) | Shares issued | Treasury shares | Shares outstanding |
Balance at January 1, 2013 | 11,444,576 | (546,590) | 10,897,986 |
Treasury shares issued based on employee participation plans | - | 157,785 | 157,785 |
Purchase of treasury shares | - | (60) | (60) |
Sale of treasury shares | - | 26,025 | 26,025 |
|
|
|
|
Balance at December 31, 2013 | 11,444,576 | (362,840) | 11,081,736 |
|
|
|
|
Treasury shares issued based on employee participation plans | - | 76,695 | 76,695 |
Sale of treasury shares | - | 125 | 125 |
|
|
|
|
Balance at December 31, 2014 | 11,444,576 | (286,020) | 11,158,556 |
22.4 Dividends paid
| 2013 | 2014 | 2015 (proposed) |
Number of shares eligible for dividend | 10,991,802 | 11,098,831 |
|
Dividends paid (CHF/share) | 0.50 | 1.50 | 1.50 |
Payout from statutory capital contribution reserve (CHF/share) | 1.00 | – |
|
22.5 Conditional share capital reserved for the employee participation plans
Shares (each share has a nominal value of CHF 0.10) | 2013 | 2014 |
Balance at January 1 | 858,636 | 858,636 |
Employee share options exercised (see note 10) | – | – |
|
|
|
Balance at December 31 | 858,636 | 858,636 |
|
|
|
Employee share options outstanding (see note 10) | 148,704 | 124,739 |
Shares granted to employees based on performance share matching plans, not yet transferred (see note 10) | 162,709 | 182,740 |
Shares granted to employees based on other share plans, not yet transferred (see note 10) | 6,075 | 5,373 |
22.6 Conditional and authorized share capital for the purpose of future business development
| 2013 | 2014 |
Conditional share capital |
|
|
Shares (with a nominal value of CHF 0.10 each) | 1,800,000 | 1,800,000 |
CHF | 180,000 | 180,000 |
|
|
|
Authorized share capital |
|
|
Expiry date | 21.04.2014 | 14.04.16 |
Shares (with a nominal value of CHF 0.10 each) | 2,200,000 | 2,200,000 |
CHF | 220,000 | 220,000 |
The Articles of Incorporation of Tecan Group Ltd. (the ultimate holding company) require that the existing conditional share capital for future business development shall be reduced if and to the extent authorized capital is used and that the authorized capital shall be reduced if and to the extent new shares are created under the respective conditional capital. However, the conditional capital for employee participation plans is not affected by this rule.
22.7 Capital management
The Board’s policy is to maintain a strong capital base in order to ensure investor, creditor and market confidence and to sustain future development of business. It is the Group’s target to keep a minimum equity ratio of 30% (reported in 2014: 65.4% and 2013: 72.0%), which limits the level of borrowings. Changes to this target are subject to the Board of Directors’ approval. In addition, all covenants relating to bank liabilities must be satisfied at any time.
The Board of Directors monitors both the earnings per share and the ability of the Group to undertake future business development. Amongst others it may initiate share buyback programs in order to rebalance the position of the Group in relation to these targets.
The level of dividend payments to shareholders shall be kept on a constant and ongoing level.
There were no changes in the Group’s approach to capital management during the year.