Annual Report 2022

27. Share-based Payments

Options on participation certificates of Chocoladefabriken Lindt & Sprüngli AG are only outstanding within the scope of the existing employee stock option program. An option entitles an employee to a participation certificate at an exercise price, equal to the average of the price of the five days preceding the issue date. The options have a blocking period during the vesting period of three to five years and are expiring after seven years, if not being exercised. Changes in outstanding options can be viewed in the table below:

 

 

2022

 

2021

 

 

Number of options

 

Weighted average exercise price
(CHF/PC)

 

Number of options

 

Weighted average exercise price
(CHF/PC)

Outstanding options as at January 1

 

112,156

 

6,760

 

109,649

 

6,181

New option rights

 

24,233

 

10,251

 

28,980

 

7,918

Exercised rights

 

– 14,962

 

5,599

 

– 22,418

 

5,382

Cancelled rights

 

– 2,426

 

7,926

 

– 4,055

 

6,993

Outstanding options as at December 311

 

119,001

 

7,593

 

112,156

 

6,760

of which exercisable at December 31

 

22,514

 

5,653

 

15,955

 

5,499

Average remaining time to expiration (in days)

 

652

 

 

 

680

 

 

1

The exercise price varies between CHF 5,360 to CHF 10,251 as of December 31, 2022.

Options expenses are charged to the income statement proportionally according to the vesting period. The recorded expenses amount to CHF 16.0 million (CHF 14.8 million in prior year). Moreover, CHF 14.9 million deferred tax expenses on employee stock options in the USA were recorded directly in equity (CHF 14.0 million deferred tax benefits in prior year).

The assumptions used to calculate the expenses for the grants 2019 to 2022 are listed in the following table:

Date of issue

 

25.1.2022

 

29.1.2021

 

15.1.2020

 

16.1.2019

Number of issued options

 

24,233

 

28,980

 

27,070

 

26,510

of which in bracket A (blocking period 3 years)

 

8,400

 

10,062

 

9,392

 

9,205

of which in bracket B (blocking period 4 years)

 

8,509

 

10,203

 

9,534

 

9,330

of which in bracket C (blocking period 5 years)

 

7,324

 

8,715

 

8,144

 

7,975

Issuing price (CHF)

 

10,251

 

7,918

 

7,904

 

5,936

Price of participation certificates on date of issue (CHF)

 

10,110

 

7,730

 

8,010

 

5,820

Value of options on issuing date (CHF)

 

 

 

 

 

 

 

 

Bracket A (blocking period 3 years)

 

784

 

519

 

651

 

562

Bracket B (blocking period 4 years)

 

852

 

571

 

680

 

615

Bracket C (blocking period 5 years)

 

905

 

613

 

712

 

663

Maximum life span (in years)

 

7

 

7

 

7

 

7

Form of compensation

 

PC from conditional capital

Expected life span (in years)

 

5–6

 

5–6

 

5–6

 

5–6

Expected rate of retirement per year

 

2.6%

 

2.5%

 

2.3%

 

2.2%

Expected volatility

 

15.5%

 

14.9%

 

14.6%

 

18.3%

Expected dividend yield

 

1.53%

 

1.60%

 

1.65%

 

1.68%

Risk-free interest rate

 

(0.55)–(0.47)%

 

(0.55)–(0.46)%

 

(0.46)–(0.38)%

 

(0.27)–(0.11)%

Model

 

Binomial model