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24 Equity

This note includes information about the Company’s share capital and dividend payments. The other components of equity consist of additional paid-in capital, the translation reserve, treasury shares and retained earnings. The Company’s shares are listed on SIX Swiss Exchange.

Issued share capital

The Company has 320,053,240 shares in issue as of 31 December 2020 (also as of 31 December 2019 and 1 January 2019), all fully paid. The nominal value of each share is CHF 0.01. Each share is entitled to one vote at shareholders’ meetings. The shareholders are entitled to dividends as declared from time to time. The 320,053,240 shares represent €2.8 million of share capital.

Authorised share capital and conditional share capital

The Company has authorised share capital and conditional share capital of CHF 640,106.48 each as of 31 December 2020 and 31 December 2019.

The Board of Directors’ authority to increase the share capital out of authorised share capital is limited until 7 April 2022. Capital increases from authorised and conditional share capital are mutually exclusive, i.e. they are subject to a single combined limit, and may not exceed 64,010,648 shares (equalling CHF 640,106.48 or 20% of the existing share capital). However, the shares issued from authorised and conditional share capital under the exclusion of subscription and advance subscription rights, respectively, is limited until 7 April 2022 to a single combined maximum of 32,005,324 shares (equalling CHF 320,053.24 or 10% of existing share capital).

The authorised share capital can be used for various purposes. This creates a flexibility to seek additional capital, if required. The conditional share capital is divided into CHF 160,026.62 for employee benefit plans and CHF 480,079.86 for equity linked financing instruments.

See note 4 for information about a planned issue of shares out of the Company’s authorised share capital in connection with the acquisition of the remaining shares in the two joint ventures in the Middle East that is expected to be closed in the first quarter of 2021.

Treasury shares

The Company purchases its own shares on the market to settle its obligations under its share-based payment plans and arrangements (see note 31). The Company held 6,274 shares for this purpose as of 31 December 2020 (6,158 as of 31 December 2019), representing an amount of €0.1 million (€0.1 million as of 31 December 2019). All treasury shares are carried at acquisition cost.

 

 

2020

 

2019

(Number of treasury shares or in € million)

 

Number

 

Amount

 

Number

 

Amount

Balance as of 1 January

 

6,158

 

(0.1)

 

 

Purchases

 

40,000

 

(0.6)

 

47,000

 

(0.5)

Transfer under share-based payment plans and arrangements

 

(39,884)

 

0.6

 

(40,842)

 

0.4

Balance as of 31 December

 

6,274

 

(0.1)

 

6,158

 

(0.1)

Dividends

For the year ended 31 December 2020, the Board of Directors will propose to the Annual General Meeting to be held on 21 April 2021 a dividend payment of CHF 0.42 per share, totalling CHF 134.4 million (which, as per the exchange rate as of 31 December 2020, would equal €124.4 million). This amount excludes any additional shares in circulation as a result of the planned acquisition of the remaining shares in the two joint ventures in the Middle East (see note 4). The dividend payment to be proposed is not recognised as a liability.

A dividend of CHF 0.38 per share, totalling CHF 121.6 million (€114.8 million) was paid to shareholders out of the capital contribution reserve (additional paid-in capital) in April 2020. The dividend payment was not recognised as a liability as of 31 December 2019.

A dividend of CHF 0.35 per share, totalling CHF 112.0 million (€99.0 million) was paid to shareholders out of the capital contribution reserve (additional paid-in capital) in April 2019.

Accounting policy

Incremental costs directly attributable to the issue of shares and purchase of treasury shares are recognised as a deduction from equity. Any resulting tax effects of any transaction costs that are recognised in equity are also reflected in equity.

Treasury shares

The cost of repurchased shares is presented as a deduction from equity, in the separate category treasury shares. When treasury shares are subsequently transferred to settle the Group’s obligations under its share-based payment plans and arrangements (or sold, if applicable), the related amount recognised as a share-based payment expense (or any amount received under a sale) is recognised as an increase in equity. Any resulting surplus or deficit is presented as an adjustment to additional paid-in capital. The Group applies the average cost method to calculate the surplus or deficit on the transfer or sale of treasury shares.