Philips 2015 Annual Report Download - page 141

Group nancial statements 12.9
Annual Report 2015 141
The following table shows the movements in the
outstanding number of shares:
Philips Group
Outstanding number of shares in number of shares
2014 - 2015
2014 2015
Balance as of January 1 913,337,767 914,388,869
Dividend distributed 18,811,534 17,671,990
Purchase of treasury shares (28,537,921) (20,296,016)
Re-issuance of treasury shares 10,777,489 5,338,743
Balance as of December 31 914,388,869 917,103,586
Preference shares
The ‘Stichting Preferente Aandelen Philips’ has been
granted the right to acquire preference shares in the
Company. Such right has not been exercised. As a
means to protect the Company and its stakeholders
against an unsolicited attempt to acquire (de facto)
control of the Company, the General Meeting of
Shareholders in 1989 adopted amendments to the
Company’s articles of association that allow the Board
of Management and the Supervisory Board to issue
(rights to acquire) preference shares to a third-party. As
of December 31, 2015, no preference shares have been
issued.
Options, restricted and performance shares
The Company has granted stock options on its common
shares and rights to receive common shares in the
future (see note 28, Share-based compensation).
Treasury shares
In connection with the Company’s share repurchase
programs, shares which have been repurchased and are
held in treasury for (i) delivery upon exercise of options,
performance and restricted share programs, and (ii)
capital reduction purposes, are accounted for as a
reduction of shareholders’ equity. Treasury shares are
recorded at cost, representing the market price on the
acquisition date. When issued, shares are removed
from treasury shares on a rst-in, rst-out (FIFO) basis.
When treasury shares are reissued under the
Company’s option plans, the dierence between the
cost and the cash received is recorded in retained
earnings. When treasury shares are reissued under the
Company’s share plans, the dierence between the
market price of the shares issued and the cost is
recorded in retained earnings, the market price is
recorded in capital in excess of par value.
Dividend withholding tax in connection with the
Company’s purchase of treasury shares for capital
reduction purposes is recorded in retained earnings.
The following transactions took place resulting from
employee option and share plans:
Philips Group
Employee option and share plan transactions
2014 - 2015
2014 2015
Shares acquired 7,254,606
Average market price EUR 24.53
Amount paid EUR 178 million
Shares delivered 10,777,489 5,338,743
Average market price EUR 30.26 EUR 30.35
Cost of delivered shares EUR 326 million EUR 162 million
Total shares in treasury
at year-end 17,127,544 11,788,801
Total cost EUR 470 million EUR 308 million
In 2015, no additional share purchase was needed to
cover our share-based compensation plan
commitments.
In order to reduce share capital, the following
transactions took place:
Philips Group
Share capital transactions
2014 - 2015
2014 2015
Shares acquired 21,283,315 20,296,016
Average market price EUR 23.95 EUR 24.39
Amount paid EUR 510 million EUR 495 million
Reduction of capital
stock (shares) 21,837,910 21,361,016
Reduction of capital
stock (EUR) EUR 533 million EUR 517 million
Total shares in treasury
at year-end 3,303,000 2,238,000
Total cost EUR 77 million EUR 55 million
Share purchase transactions related to share plans, as
well as transactions related to the reduction of share
capital involved a cash outow of EUR 506 million,
which includes the impact of taxes. Settlements of
share-based compensation plans involved a cash
inow of EUR 81 million.
Dividend distribution
A proposal will be submitted to the 2016 Annual
General Meeting of Shareholders to pay a dividend of
EUR 0.80 per common share, in cash or shares at the
option of the shareholder, from the 2015 net income
and retained earnings of the Company.
Limitations in the distribution of shareholders’
equity
As at December 31, 2015, pursuant to Dutch law, certain
limitations exist relating to the distribution of
shareholders’ equity of EUR 2,274 million. Such
limitations relate to common shares of EUR 186 million,
as well as to legal reserves required by Dutch law
included under retained earnings of EUR 958 million,
revaluation reserves of EUR 4 million, unrealized
currency translation dierences of EUR 1,058 million,