MTN execs get R117m in shares

EXECS AND MANAGEMENT IN POUND SEATS ‘All’ that’s needed is for the operator to actually perform.

Eight MTN Group executives have netted over 1.3 million shares in the telecommunications giant, valued at R116.857 million at the market price (R87.79) when they were issued at the end of December.

The shares, issued under its 2015 performance share plan (PSP), vest in December 2021.

Group president and CEO Rob Shuter received over 400 000 shares, valued at R38.3 million at the market price on December 28. Group COO and Group CFO, Jens Schulte-Bockum and Ralpha Mupita, received around 200 000 shares, valued at R18 million and R17 million, respectively.

The group also detailed awards to five other executives, named prescribed officers (see table).

These are only shares awarded to the three executive directors and named prescribed officers. Employees at all managerial levels are eligible to be awarded shares. As at end-December 2017, over 16 million shares issued under this plan were still outstanding.

From the 2017 allocations, these four metrics are used to assess performance under the PSP:

Total shareholder return, measured against the MSCI Emerging Markets Telecoms Index

Cumulative operating free cash flow

Return on average capital employed

Service/retention elements (this measure will be reviewed yearly).

MTN notes in its 2017 integrated report that zero conditions had been achieved for the awards made in 2015 (deferred to June 2016), 2016 and 2017. At the end of 2017, the executives and prescribed officers were awarded nearly 750 000 shares under the plan, significantly fewer than in December 2018.

Executives and management stand to make a lot of money from this plan. However, the group must perform. * Ntsele was awarded 57 000 shares.

Aside from shares awarded under the PSP, MTN granted special cash-settled share-based payment incentive awards to Shuter, Mupita and Schulte-Bockum in “lieu of unvested stocks or equity relinquished upon resignation from previous employment”.

Shuter was granted an incentive based on the market value of 327 214 ordinary shares in MTN in March 2020. At a share price of R100, this would be worth nearly R33 million.

Mupita received an incentive based on the market value of 446 027 shares (to be paid in October 2019), while Schulte-Bockum received an incentive based on the market value of 64 423 shares to be paid in January 2020.

Hilton Tarrant works at YFM