Under a takeover contract, Valmy SA must issue two tranches of ordinary shares for little or no consideration, under separate conditions. The first tranche, of 90,000 units shares, vests on 1 March: all its conditions have been met for 10 months at 31 December. The second, of 60,000 units shares, depends on a condition that is not met at the reporting date. Valmy has 3,000,000 units ordinary shares outstanding throughout the year and a profit attributable to ordinary equity holders of 4,612,500 (in euros). Calculate the weighted average number of shares for basic earnings and then earnings per share. Round earnings per share to two decimals (case convention).
- Ordinary shares outstanding throughout the year
- 3,000,000
- First tranche of contingent shares
- 90,000
- Months since the conditions of the first tranche were met
- 10
- Second tranche (condition not met)
- 60,000
- Profit attributable to ordinary equity holders
- 4,612,500