Shareholders
According to the register of Kesko’s shareholders kept by the Finnish Central Securities Depository Ltd, there were 28,414 shareholders at the end of 2006 (29,339 at the end of 2005). The total number of shares registered in a nominee name was 32,535,936, accounting for 33.36% of the share capital (26,049,438 and 27.0% respectively at the end of 2005). The number of votes entitled by these shares was 33,299,883, or 8.7% of the total voting rights (26,816,958 or 7.0% respectively at the end of 2005). A list of Kesko’s largest shareholders, updated monthly, is available at www.kesko.fi /Investors.
Year 2003 share option scheme
On 31 March 2003, the Annual General Meeting resolved to gratuitously issue a total of 1,800,000 share options to the management of the Kes- ko Group as well as to a wholly-owned subsidiary of Kesko Corporation. A deviation was made from the shareholders’ pre-emptive right to subscription since the share options form a part of the incentive and commitment programme for the management. The scheme comprises approximately 60 persons.
Each share option entitles its owner to subscribe for one new Kesko Corporation B share. The share options were marked with symbols 2003D (KESBVEW103, ISIN code FI0009609317), 2003E (KESB- VEW203, ISIN code FI0009609325) and 2003F (KESBVEW303, ISIN code FI0009609333) in units of 600,000 share options each. The share subscription periods shall be:
● for share option 2003D 1 April 2005 - 30 April 2008,
● for share option 2003E 1 April 2006 - 30 April 2009 and
● for share option 2003F 1 April 2007 - 30 April 2010. The original share subscription price for share option 2003D was the trade volume weighted average price of a Kesko B share on the Helsinki Stock Exchange between 1 to 30 April 2003 (€9.63), for share option 2003E the corresponding price between 1 to 30 April 2004 (€15.19) and for share option 2003F, the corresponding price between 1 to 30 April 2005 (€19.08). From the share subscription price of share options shall, as per the dividend record date, be deducted the amount of the dividend decided after the beginning of the period for determination of the subscription price but before share subscription.
At the end of 2006, the subscription price of a B share subscribed for with share option 2003D was €4.53, with share option 2003E €12.09 and with share option 2003F €17.98. The share subscription period for share option 2003D began on 1 April 2005, for share option 2003E on 1 April 2006, and will begin for share option 2003F on 1 April 2007. Dividend rights and other shareholder rights of the shares subscribed for with options shall take eff ect when the share capital increase has been entered in the Trade Register.
Under this share option scheme a total of 1,800,000 B shares can be subscribed for and the company’s share capital may be increased by a maximum of €3,600,000 as a result of the subscriptions. The shares subscribed for under the scheme account for 1.82% of the share capital and 0.5% for all votes, presuming that all issued options are exercised. As a result of the subscriptions made with share options, the number of company shares may be increased to 98,738,705, which corresponds to a share capital of €197,477,410. As a result of the subscriptions, the aggregate number of votes may be increased to 384,371,768.
The 2003D share options were listed on the Helsinki Stock Exchange on 1 April 2005 and the 2003E share options on 1 April 2006.
Year 2000 share option scheme
Until the end of March 2006, Kesko Corporation operated the year 2000 option scheme for the top and middle management approved by the Annual General Meeting of 10 April 2000. There were two classes of share options, B options and C options. There were 3,825,000 B options and 2,015,000 C options issued, i.e. a total of 5,840,000 share options. Each option entitled the holder to subscribe for one new Kesko B share until 31 March 2006. The options were listed on the main list of the Helsinki Stock Exchange. When the option scheme was announced, it comprised nearly 600 people.
Subscriptions for shares with options
In 2006, the share capital was raised seven times corresponding to share subscriptions made with options: in February (13 Feb.) by €640,500 (320,250 shares), in May (4 May) by €938,058 (469,029 shares), in June (9 Jun.) by €59,200 (29,600 shares), in August (7 Aug.) by €118,000 (59,000 shares), in October (3 Oct.) by €94,800 (47,400 shares), in November (1 Nov.) by €157,200 (78,600 shares) and in December (21 Dec.) by €64,240 (32,120 shares), or by €2,071,998 (1,035,999 shares) in aggregate.
By the end of the subscription period on 31 March 2006, a total of 416,119 B shares were subscribed for with the year 2000 B options and a total of 234,060 B shares with C options, or 650,179 in aggregate.
By 7 December 2006, 250,900 B shares had been subscribed for with 2000D options and correspondingly 134,920 B shares with 2003E options, i.e. a total of 385,820 B shares. The subscribed shares have been included in the main list of the Helsinki Stock Exchange for public trading. The subscription period with 2003F share options will begin on 1 April 2007.
Other special shareholding rights
The company has not issued other share options, convertible bonds, bonds with warrants or other special rights to company shares.
Shares and share options held by the management
At the end of 2006, the members of Kesko Corporation’s Board of Direc- tors, the Managing Director and the Deputy Managing Director and the corporations under their control, held 197,030 Kesko A shares (551,790 at the end of 2005) and 170,520 Kesko B shares (155,530), i.e. a total of 367,550 (707,320) shares which represented 0.38% (0.73%) of the company’s total share capital and 0.56% (1.48%) of its voting rights. At the end of 2006, the company’s Managing Director and Deputy Managing Director held a total of 73,000 Kesko share options (115,500 at the end of 2005), which represented 0.07% (0.12%) of the company’s total share capital and 0.02% (0.03%) of voting rights, presuming that shares have been subscribed for with all of these options. No Board members held share options at the end of the year 2006 (nor at the end of 2005).
Detailed information on shares and share options held by the management at the beginning and at the end of 2006 is given on pages 64-65.
Trading in Kesko’s shares and share options in 2006
Kesko Corporation’s shares are listed on the OMX Helsinki Stock Exchange. Key information about share trading in 2006 is given in the tables and graphs on this double page spread. The price performance of both shares clearly exceeded the Helsinki Stock Exchange index development: during the year, the A share price rose by 59% and the B share price by 67%. The number of B shares traded increased by 15% compared with the previous year. At the end of the year, the market value of A shares was €1,219 million and that of B shares €2,632 million. The total market capitalisation of the company was €3,851 million, an increase of €1,533 million during the year.
Flagging notifi cations
Kesko Corporation did not receive any fl agging notifi cations during 2006. The company has not been informed of any agreements relating to its share ownership or the exercising of its voting rights.
Up-to-date information on shares
Kesko A, trading Kesko B, trading
Kesko A, average price Kesko B, average price A share B share
EARNINGS PER SHARE, DILUTED DIVIDEND PER SHARE * proposal to the Annual General Meeting
A share B share
EQUITY PER SHARE, €, 31 Dec., diluted
25 20 15 10 5 0 1/2002
PRICE TRENDS OF KESKO SHARES, €
50.00 40.00 30.00 20.00 10.00 0.00 Kesko A Kesko B
OMX Helsinki CAP OMX Helsinki
1/2003 1/2004 1/2005 1/2006 12/2006 1/2002
TRADING OF KESKO SHARES
50.00 40.00 30.00 20.00 10.00 0.00 1/2003 1/2004 1/2005 1/2006 12/06 400,000,000 350,000,000 300,000,000 250,000,000 200,000,000 150,000,000 100,000,000 50,000,000 0
Average share price, € Share trading by month, €
MARKET VALUES OF KESKO SHARES, € million
1/2002 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 1/2003 1/2004 1/2005 1/2006 12/06 2002 2003 2004 2005 2006 < FAS IFRS > 2004
EARNINGS PER SHARE AND DIVIDEND PER SHARE, € 3.0 2.5 2.0 1.5 1.0 0.5 0 < FAS IFRS > 2002 2003 2004 2004 2005 2006 *
NUMBER OF KESKO SHAREHOLDERS , at 31 Dec. 30,000 25,000 20,000 15,000 10,000 5,000 0 2002 2003 2004 2004 2005 2006
SHARE PRICES PER EARNINGS, P/E, at 31 Dec., diluted 25 20 15 10 5 0 < FAS IFRS > 2002 2003 2004 2004 2005 2006