In H1 '17 2,248,980 shares were issued following the exercise of share options by employees (H1 '16: 1,775,105).
7. Share-based compensation
Share-based compensation expenses amounted to €8.0 million in H1 '17 versus an income €1.6 million in the same period last year. In H1 '17 a total number of 2.2 million stock options have been exercised.
In May 2017, the group granted 0.7 million stock options under the stock option plan of which 350,000 stock options were granted to Management Board members. The purpose of the share-based compensation is to attract and retain management and employees and align the interests of management and eligible employees with those of shareholders, by providing additional incentives to improve the group's performance on a long-term basis.
In addition to the stock option grant, the group also granted phantom shares to certain groups of employees. The phantom share plan is classified as a cash-settled plan. The plan has a three-year service period as the only vesting condition.
As part of the acquisition of Autonomos GmbH restricted stock units have been granted to certain employees of Autonomos.
For further information on our share-based compensation, reference is made to note 7 and note 33 in our 2016 Annual Report.
8. Business Combination
On 17 January 2017, the group acquired 100% of the shares of Autonomos GmbH for €26.2 million of which €24.8 million is paid in cash and the remainder in TomTom shares. The company is a Berlin-based autonomous driving start-up.
We have acquired a vast amount of technical expertise that will be of value in the further development of our location technologies. Specifically, the acquisition will give us a fuller understanding of the autonomous driving stack and real-time computer vision technology and allow us to improve quality of our products like TomTom HD Map, RoadDNA localisation technology, navigation, traffic and other cloud services.
9. Related party transactions
Reference is made to note 7 for stock options granted to the members of the Management Board during H1 '17.
In the normal course of business, the group receives map development and support services from its associate Cyient Ltd. Such transactions take place at the normal market conditions and the total payments made for these services in H1 '17 amounted to €7.7 million (H1 '16: €7.8 million).
Transactions and balances with other associates are not material and hence are not disclosed.
10. Seasonality
In the 12 months ended June 2017, the group had revenue of €971 million compared with revenue of €1,019 million for the 12 months period ending June 2016.
The group’s sales within the Consumer segment are traditionally higher in the second half of the year due to the holiday sales in the fourth quarter and traditionally low sales in the first quarter. This trend has become less apparent in recent years. In the 12 months ended 30 June 2017, Consumer had revenue of €514 million compared with €611 million in the same period ended 30 June 2016.
Other operating segments’ revenue is generally not materially affected by seasonality.
Besides the normal market seasonality, the group revenue can also be affected by new product launches.
11. Commitments and contingent liabilities
In the first half of 2017, there were no material changes to the group’s commitments and contingent liabilities from those disclosed in note 32 of our 2016 Annual Report.
12. Fair value and fair value estimation
The fair values of our monetary assets and liabilities as at 30 June 2017 are estimated to approximate their carrying value. There has been no change in the fair value estimation technique and hierarchy of the input used to measure the financial assets/liabilities carried at fair value through profit or loss compared with the method and hierarchy disclosed in our 2016 Annual Report.
13. Subsequent events
There has been no subsequent event from 30 June 2017 to the date of issue that affect the consolidated interim financial statements.
- END -
Accounting policies - basis of accounting
The condensed consolidated financial information for the three-month and
six-month period ended 30 June 2017 with related comparative information
has been prepared using accounting policies which are based on
International Financial Reporting Standards (IFRS) as endorsed by the
EU. Accounting policies and methods of computation followed in the
condensed consolidated financial information, for the period ended 30
June 2017, are the same as those followed in the Financial Statements
for the year ended 31 December 2016. Further disclosures as required
under IFRS for a complete set of consolidated financial statements are
not included in the condensed consolidated financial information. The
quarterly and interim condensed consolidated information in this press
release is unaudited.
