Mobile World plans to issue ESOP shares of no more than 2%

Mobile World Investment Corporation has just announced a plan to issue shares to the executive board and key employees (ESOP) if it completes more than 110% of its after-tax profit plan.

According to the proposal, if the company's after-tax profit is below 110% of the plan, the company will not issue ESOP shares. In case the company completes 110% or more of the profit plan, for every 1% of after-tax profit exceeding this level, the ESOP issuance rate will be added 0.05%. However, the maximum ESOP rate is not more than 2% of the total outstanding shares, i.e. not more than 29.25 million shares.

Mobile World may adjust down 80% of the above ESOP issuance ratio if the average performance of MWG's stock price this year compared to 2023 does not achieve at least 10% better performance than the average performance of the VN-Index this year compared to 2023.

The issuance price is 10,000 VND per share and is expected to be implemented in 2025. The subjects eligible to buy shares are key managers who have excellently completed the performance measurement index and have made important contributions to helping the company exceed the business plan. The shares will be restricted from transfer within 2 years from the date of issuance, in which after the first year, 50% of the shares will be freely transferable.

This year, Mobile World presented shareholders with a target of 125,000 billion VND in net revenue and 2,400 billion VND in after-tax profit, respectively a 6% increase in revenue and more than 14 times higher in profit compared to last year.

This target is similar to the plan expected to be announced in early February. At that time, Mobile World's management predicted that consumer shopping demand would remain flat, or even decrease compared to last year in some non-essential items. However, the company believes that there is room to continue to consolidate revenue and strongly improve profit targets thanks to a comprehensive restructuring starting in the fourth quarter of 2023 with drastic changes aimed at improving operational efficiency, plus a healthy financial foundation, increased market share of Mobile World, Topzone, Dien May Xanh chains and double-digit revenue growth for the Bach Hoa Xanh, An Khang, AVAKids chains.

The company's management said that it has set goals and built business strategies for each chain in accordance with the corresponding stage in the business life cycle and market potential. In particular, the Mobile World and Dien May Xanh chains will contribute about 65% of revenue and bring in the main profit for the company. For the Bach Hoa Xanh chain, it is expected to contribute about 30% of revenue, grow double-digit revenue, increase market share and start bringing profit to the company from 2024. The remaining revenue comes from the An Khang chain, AVAKids and joint ventures in the Indonesian market.

According to the newly announced proposal, Mobile World submitted to the shareholders' meeting to approve the plan to pay cash dividends at a rate of 5% this year, equivalent to each shareholder owning 500 VND. In addition, the company also submitted a plan to spend up to 100 billion VND from undistributed profits to buy back shares as treasury stocks. The transaction is expected to be carried out this year by order matching method.

Source