Securities Daily: Sany Heavy Industry plans to grant 178 million equity incentives to profitability in the industry*

Source: Securities Daily

On the evening of November 6, Sany Heavy Industry, a leading company in the global machinery industry, released a draft equity incentive plan. The incentive plan consists of two parts: a stock option incentive plan and a restricted stock incentive plan. The source of its shares is the company's directional issuance of new shares to incentive recipients. The incentive plan intends to grant a total of 178,255,100 rights and interests to the incentive recipients, accounting for about 2.35% of the company's total share capital of 759,370.61 million shares.
 

2,533 people received equity incentives
The stock option incentive plan intends to grant 154,909,200 stock options to the incentive recipients, accounting for about 2.04% of the company's total share capital, of which 139,419,200 are granted for the first time, accounting for 1.84% of the company's total share capital; 15.49 million shares are reserved, accounting for 10% of the total number of stock options to be granted under the plan, accounting for 0.204% of the company's total share capital at the time of signing the plan. The exercise price is $9.38. In addition, the restricted stock incentive plan intends to grant 23,345,900 restricted shares of the company to the incentive recipients, accounting for 0.31% of the company's total share capital of 759,370.61 million shares. The grant price is $4.69.
Among them, a total of 2,533 people are eligible for the stock option incentive plan, including directors and senior management personnel of the company; middle management of the company; The company's core business (technical) personnel. Among them, a total of 26.725 million shares were granted to 12 vice presidents including Liang Linhe and Duan Dawei. A total of 11,183.42 million shares were granted to 2,094 people, including middle managers and core business and technical backbones.
The granted stock options will be evaluated and exercised annually in the three fiscal years of the exercise period. The performance appraisal of each year is: *5656 exercise periods: the net profit in 2013 will increase by no less than 10% compared with 2012; The second exercise period: the net profit in 2014 will increase by no less than 10% compared with 2013: the net profit in 2015 will increase by no less than 10% in the third exercise period compared with 2014.
An analyst who did not want to be named pointed out that the machinery industry has shown a bottoming out trend, and it should not be a problem to complete the exercise standards required by equity incentives with the leading position of Sany Heavy Industry. As of November 5, Sany Heavy Industry closed at 9.38 yuan.
 

Sany Heavy Industry "not bad money"
Since the beginning of this year, A-shares have continued to fall as a whole, and Sany Heavy Industry has also been disturbed by "rumors". At that time, Liu Hua, deputy general manager of the financial headquarters of Sany Heavy Industry, said in an interview with the Securities Daily that the so-called rupture of Sany's capital chain was completely pseudo. "First of all, in the first half of the year, the company carried out large-scale mergers and acquisitions and joint ventures, and the expenditure was real money; On the other hand, as one of the top five companies in China in terms of stock returns, Sany has also made high cash distributions."
On April 17 this year, Sany Heavy Industry acquired 90% of the shares of the global concrete *5656 brand, the German Putzmeister Company, for 324 million euros, opening a new stage of Sany's internationalization process. Previously, whether in India, the United States, Brazil, or Germany, Sany's internationalization path was mainly greenfield investment, so this M&A "elephant" was also regarded as a strategic M&A rather than a simple financial M&A.
In addition to the mergers and acquisitions of real money, Sany Heavy Industry distributed 3 yuan in cash for every 10 shares in 2011, with a total of 2.278 billion yuan. This is the ninth cash dividend of Sany Heavy Industry in the nine years since its listing on the Shanghai Stock Exchange in 2003. "If the capital chain is broken, which company will spend nearly 5 billion yuan in cash expenditure for mergers and acquisitions and dividends?" Liu Hua asked rhetorically. As an industry leader, Sany has always had a gross profit margin, net profit margin and high credit extension of *5661 in the industry. According to Liu Hua, "the bank credit of Sany Group and Sany Heavy Industry has exceeded 100 billion yuan, as high as 223.98 billion yuan and 159.87 billion yuan respectively." According to the data, from 2007 to 2011, Sany Heavy Industry was the first enterprise in China with a net inflow of financial income of more than 10 billion yuan.
Based on such a strong net cash inflow capacity, it is not difficult to understand why Sany still dared to make a big merger and acquisition when the economy was sluggish in the first half of the year. If Sany's M&A and joint venture cash in the first half of the year are excluded, its net cash inflow in the first half of the year will still rank among the industry*5656. "Historically, cash flow in the first half of the year has generally been negative, and the second half of the year has been positive. Because the first half of the year is the peak sales season, the second half of the year will be in place, and the annual cash flow will definitely be positive. Liu Hua said.
It is based on this that Xiang Wenbo once posted on Weibo, "Please rest assured that all Sany shareholders and all friends who care about Sany can rest assured that Sany is very healthy, and in the words of Professor CEIBS, there are no five companies like Sany in China!" Of course, we should do better! Sany is very healthy! First of all, it has a strong profitability, ranking first in the industry, ranking 26th among listed companies in China. Second, there is a strong cash flow, with a positive cash flow of more than 13 billion in the past five years. ”