RE:RE:RE:RE:RE:RE:RE:Bad news/ Good newsThey vest annually over a three year period. What your saying isn't correct or else the expense of last quarter $2,465,000 would be much lower.
A rough calcluation of last quarter's change
Price 10.12-7.76 = 2.36
units (we would need the exact date that uints were expired, issued or forfeited)
Average (this is rough because the exact dates are not known, exact dates should be used to be 100% accurate)
(985000+951000)/2=968000
Calculation estimated 2.36*968000=2,284,480
Expense is $2,465,000
Difference $180,520 is timing of when the units were expired/forfeited
Your calculation as suggested would lower this by 3/36 and be $2.36*968000*3/36= $137,273.
In a mark to market the value is calculated at the end of each quarter and it assumes that value will be that value at vesting and the comapny will have to pay that out in cash at vesting. The swings come from the fluctuiation in share price, not a quarterly amortization.
Viemed is not the only company that has this problem, I don't really follow the life insurance comapnies, but MFC has huge fluctuations in earning due to mark to market on their investment portfolio. They probably flag it as one time or take it out of adjusted EBITDA
Torontojay wrote: Torontojay wrote: lscfa wrote: I'm not sure about that. Anyone know how to value these damn phantom shares?
| $US | Fair value liability | Expensed to SG&A | No of Shs o/s | Vested | Ending Sh pr |
| Jun30/20 | 4,699,000 | 4,308,000 | 1,042,000 | 601,000 | 9.60 |
| Mar31/20 | 4,593,000 | (697,000) | 1,328,000 | 0 | 4.76 |
| Dec31/19 | 5,290,000 | | 1,350,000 | 0 | 6.20 |
| | | | | | |
| $US | Fair value liability | Expensed to SG&A | No of Shs o/s | Vested | Ending Sh pr |
| Jun30/21 (e) | | | 571,000 | 700,000 | |
| Mar31/21 | 7,808,000 | 2,465,000 | 951,000 | 0 | 10.12 |
| Dec31/20 | 5,344,000 | | 985,000 | 0 | 7.76 |
| | | | | | |
donmayne wrote: If the share price closes at a low at the end of Q2, will that reverse all the phantom share charges for the prior three quarters? That would amount to .075 per share boost to quarterly income.
That phantom share plan was a bad plan poorly executed. It has cost the company by the wild volatility that it generates in the earnings. It was so short sighted not to have abandoned that plan and replaced it with a better plan that provides an equivalent incentive.
In any event, I expect a reversal of phantom share expenses will boost Q2s income.
The amount that will end up in sga in q2 would be:
(market price - grand date price)* 701,000 + number of outstanding options that have not vested * (market price -grand date price) * the amount that should be appropriately amortized for that year.
This should read:
(market price - grant price)* 700,000 +
(Market price - grant price)* unvested options* the amount that should be amortized for that quarter.
it is typical to use a straight line declining method which implies that a 2 year vesting schedule would be amortized by 1/2 per year or 1/2*1/4= 1/8 per quarter. In the case of Viemed, if there are 2 years left then we are allowed to amortize 12.5% per quarter until the maturity date is reached.