Shares and Shareholders
Share capital and shares
According to Metso's Articles of Association, the minimum share capital is EUR 170 million and the maximum share capital is EUR 680 million. Metso has a single series of shares. Each share has a nominal value of EUR 1.70 and entitles its holder to one vote at a general meeting.
On December 31, 2003, Metso's share capital was EUR 231,625,926.50, and it was divided into 136,250,545 fully paid shares. No changes took place in the share capital during 2003. If the year 2000 options are exercised to subscribe for all 5,000,000 shares, and if the year 2001 options are exercised to subscribe for all 1,000,000 shares, Metso's share capital will increase to EUR 241,825,926.50 and the number of shares to 142,250,545, of which the new shares will account for 4.22 percent.
Any shareholder whose ownership of the Corporation's shares or the voting rights produced by these shares reaches or exceeds 33 1/3 percent or 50 percent, is obliged to redeem the shares of the other shareholders upon demand and in the manner defined in the Articles of Association.
The Annual General Meeting of April 15, 2003 authorized the Board of Directors to decide, within one year of the Meeting, on the acquisition of the Corporation's own shares, using its distributable funds. The Corporation's own shares may be acquired for use as payment in acquisitions or in financing investments or as an incentive for key personnel. The Meeting also authorized the Board of Directors to decide on the disposal and annulment of the Corporation's own shares. Such shares may be acquired provided their combined nominal value does not exceed 5 percent of the Corporation's share capital, i.e. 6,812,527 shares.
In 2003, no own shares were acquired or disposed of. On December 31, 2003 the Corporation held 60,841 of its own shares, representing 0.04 percent of total shares and votes. These shares were acquired in 1999 for a total price of EUR 654,813, i.e. EUR 10.76/share.
The Annual General Meeting of April 15, 2003 authorized the Board to decide on raising the share capital by a rights offering, a convertible bonds issue and/or an issue of share options. The authorization expires one year from the Annual General Meeting. No more than 12,500,000 new shares with a nominal value of EUR 1.70 may be subscribed for as a result of the rights offering, convertible bond issue or issue of share options. The Corporation's share capital may be raised in total by no more than EUR 21,250,000, which represents 9.17 percent of the share capital and votes. The Board of Directors had not exercised these authorizations by December 31, 2003.
Market capitalization and trading
Metso Corporation's shares have been listed on the Helsinki Exchanges (HEX:MEO1V) and the New York Stock Exchange (NYSE:MX) since July 1, 1999. Metso's year 2000 A options have been listed on the Helsinki Exchanges since June 29, 2001. The year 2000 B options were listed on the Helsinki Exchanges combined with the year 2000 A options on April 1, 2003. The year 2001 A and B options were also combined and were listed as a separate security on April 1, 2003.
The highest quotation of Metso's share on the Helsinki Exchanges was EUR 11.41, and the lowest EUR 7.52. The share price on December 31, 2003 was EUR 9.68, and the average trading price for the year was EUR 9.21. The Corporation's end-of-year market capitalization was EUR 1,318 million, excluding shares held by the Corporation.
In 2003, 97,816,594 Metso shares were traded on the Helsinki Exchanges. The total turnover was EUR 901 million. The average daily trading volume was 391,266 shares. The relative turnover including the ADS turnover was 73.3 percent.
The highest price of Metso's American depository share (ADS) on the New York Stock Exchange was USD 12.77, and the lowest USD 8.31. The ADS price on December 31, 2003 was USD 12.53, and the average trading price was USD 10.59. In 2003, 2,042,018 Metso American depository shares were traded on the New York Stock Exchange, to a value of USD 22 million. Each ADS represents one share.
The highest quotation for Metso's year 2000 A/B options on the Helsinki Exchanges was EUR 1.00 and the lowest EUR 0.30, with the value of the option on December 31, 2003 being EUR 0.50. The highest quotation for Metso's year 2001 A/B options on the Helsinki Exchanges was EUR 0.70 and the lowest EUR 0.38, with the value of the option on December 31, 2003 being EUR 0.55. In 2003, a total of 155,400 of Metso's year 2000 A/B options and a total of 50,200 of Metso's year 2001 A/B options were traded. The value of the year 2000 A/B options traded was EUR 72,973 and the value of the year 2001 A/B options traded was EUR 27,140.
Metso Corporation currently has three options programs, launched in 2000, 2001 and 2003. The programs are part of the incentive system for key personnel, and included 218 persons at the end of 2003. The programs give the right to subscribe for a maximum of 13,800,000 new shares.
The year 2000 options program includes 5,000,000 options, which entitle their holders to subscribe for a maximum of 5,000,000 shares. 2,500,000 of the options were A options, and 2,500,000 were B options. The series were combined on April 1, 2003 as one security. The share subscription price was EUR 13.80 on December 31, 2003. Annually paid dividends are deducted from the subscription price. Subscription of shares with the options began on April 1, 2001 for the A options, and on April 1, 2003 for the B options, at which time the series were also combined. The subscription period for the year 2000 A/B options will end on April 30, 2005.
The year 2001 options program includes 1,000,000 options, which entitle their holders to subscribe for a maximum of 1,000,000 shares. 500,000 of the options were A options, and 500,000 were B options. The series were combined on April 1, 2003 as one security. The share subscription price was EUR 13.80 on December 31, 2003. Annually paid dividends are deducted from the subscription price. Subscription of shares with the options began on April 1, 2001 for the A options, and on April 1, 2003 for the B options, at which time the series were also combined. The subscription period for the year 2001 A/B options will end on April 30, 2005.
According to the decision of the Annual General Meeting the number of options related to the year 2003 options program is 7,800,000 in total, which entitle their holders to subscribe for a maximum of 7,800,000 shares. 5,600,000 of the options can, by the decision of a General Meeting, be distributed to key personnel of Metso. Options will be distributed, if Metso's earnings per share increases sufficiently with reference to its starting figure, and if other criteria for the granting of options are met. 2,600,000 of the options were designated as 2003A, 2,600,000 as 2003B and 2,600,000 as 2003C options.
The share subscription prices are, for the 2003A options the trade-weighted average price of the Metso share on the Helsinki Exchanges during January 1 - March 31, 2004, for the 2003B options the trade-weighted average price of the Metso share on the Helsinki Exchanges during January 1 - March 31, 2005, and for the 2003C options the trade-weighted average price of the Metso share on the Helsinki Exchanges during January 1 - March 31, 2006. The subscription prices of shares that can be subscribed for with the options will be reduced, after commencement of the subscription price determination period and before share subscription, by the amount of dividends decided upon on the record day for each dividend distribution.
The share subscription periods are, for the 2003A options April 1, 2006 - April 30, 2009, for the 2003B options April 1, 2007 - April 30, 2010, and for the 2003C options April 1, 2008 - April 30, 2011.
In spring 2003, Metso's Board of Directors decided that the maximum number of 2003A options to be distributed would be 2,500,000. At the same time, the Board defined the following minimum criteria for distributing the 2003A options: an operating profit of 5 percent, a 9 percent return on capital employed (ROCE) and earnings per share of EUR 0.75 in 2003. As the minimum criteria were not fulfilled, no options were distributed from the program, apart from 100,000 options granted to the new President and CEO.
Holdings of Metso's Board of Directors and executive management on December 31, 2003
At the end of 2003, the members of Metso Corporation's Board of Directors and Olli Vaartimo, Executive Vice President and CFO who served as the Corporation's acting President and CEO from September 25, 2003 to March 1, 2004, held a combined total of 29,611 Metso shares. These shares represent 0.02 percent of the Corporation's share capital and voting power. While serving as President and CEO of Metso Corporation, Board member Heikki Hakala was issued 150,000 options. The total number of options issued to Heikki Hakala and Olli Vaartimo was 280,000 at the end of the year. On the basis of these options, the share capital of Metso Corporation may increase by EUR 476,000 and the number of shares by 280,000, which on December 31, 2003 would have represented 0.21 percent of the company's share capital and voting power.
Metso Corporation's extended insider holdings.
The taxable value of Metso's share in Finland
The taxable value of Metso Corporation's share in Finland in 2003 is EUR 6.79 / share.
Metso's objective is to distribute annual dividends equivalent to at least one third of the average earnings per share over five years. The dividend policy is founded on the Corporation's long-term profitability and financial strength.
Metso's Board of Directors has decided to propose to the Annual General Meeting, which will convene on April 6, 2004, that a dividend of EUR 0.20 per share be distributed for 2003.
At the end of 2003, Metso's biggest shareholders were UPM-Kymmene Corporation, which held 14.6 percent of all shares, and the Finnish State with an 11.5 percent holding. Nominee-registered shares and shares in direct foreign ownership accounted for 45.7 percent of the total stock. 7.1 percent of the total stock was held by Finnish private individuals.
Up-to-date information on Metso's share price and shareholders can be found at Metso's Internet site at www.metso.com/investors.