Growthpoint Interactive Annual Report 2018

Notes to the Financial Statements continued 3.7 Earnings per stapled security (“EPS”) Earnings per stapled security Basic EPS is determined by dividing the profit or loss attributable to Securityholders of the Group by the weighted average number of equivalent securities outstanding during the financial year. Diluted EPS adjusts the figures used in the determination of basic EPS by taking into account amounts unpaid on securities and the effect of all dilutive potential ordinary securities. 2018 2017 Profit attributable to Securityholders of the Group ($) 357,709,000 278,090,000 Weighted average number of stapled securities on issue for the year (no.) 668,456,752 651,245,952 Basic & diluted earnings per stapled security (cents) 53.5 42.7 3.8 Share-based payment arrangements Accounting policies Share-based payment transactions The grant-date fair value of share-based payment awards granted to employees is recognised as an employee expense, with a corresponding increase in equity, over the period that the employees unconditionally become entitled to the awards. The amount recognised as an expense is adjusted to reflect the number of awards for which the related service and non-market performance conditions are expected to be met, such that the amount ultimately recognised as an expense is based on the number of awards that meet the related service and non-market performance conditions at the vesting date. Determination of fair values Fair value is calculated based on the present value of the performance right on the date of issuance in future periods, discounted at a market-related discount rate. Share-based payment arrangements At 30 June 2018, the Group has the following share-based payment arrangements: Employee Incentive Plans FY15, FY16, FY17, FY18 The Group has introduced employee incentive plans for all employees (including the Managing Director). The plans are designed to link employees’ remuneration with the long-term goals and performance of the Group and the maximisation of wealth for its Securityholders. The current measures for the plans, which are reviewed regularly by the Nomination, Remuneration & HR Committee and/or the Board are described in full on page 43 (in the remuneration report section of the Directors’ report). Under each plan, each eligible employee is sent a letter of invitation to the plan which outlines the percentage of their base salary that they can earn as performance rights. Acceptance of this invitation is the grant date for those performance rights. The percentage of the maximum possible earnings for each employee is determined by the percentage of the measures under each plan that are achieved. Subject to the employee remaining employed by the Group, on or about 30 September of each year the employee will receive 25% of his or her performance rights, as they vest through the issue of stapled securities in the Group. Securities will be issued for an equivalent amount at an issue price per security based on the volume weighted average price of the securities over the first 20 trading days in September prior to the vesting date of the first tranche of each plan. Any director in the plan will have their grant ratified at the Group’s Annual General Meeting and following approval will be issued their securities on the same basis as the employees. The performance rights are cumulative and, subject to some exceptions, immediately vest in the case of a takeover of the Group or a redundancy. 43 Growthpoint Properties Australia 2018 Annual Report 86