Annual and transition report of foreign private issuers pursuant to Section 13 or 15(d)

Stock-Based Compensation

v3.21.1
Stock-Based Compensation
12 Months Ended
Mar. 31, 2021
Share-based Payment Arrangement [Abstract]  
Stock-Based Compensation Stock-Based Compensation
Total stock-based compensation expense consists of the following:
  Years Ended 31 March
(Millions of US dollars) 2021 2020 2019
Liability Awards $ 21.7  $ 2.8  $ (0.6)
Equity Awards 18.0  10.3  12.5 
Total stock-based compensation expense $ 39.7  $ 13.1  $ 11.9 
As of 31 March 2021, the unrecorded future stock-based compensation expense related to outstanding equity awards was US$17.1 million and will be recognized over an estimated weighted average amortization period of 1.8 years.
2001 Equity Incentive Plan
Under the Company’s 2001 Equity Incentive Plan (the “2001 Plan”), which was reapproved to continue until September 2021, the Company can grant equity awards in the form of nonqualified stock options, performance awards, restricted stock grants, stock appreciation rights, dividend equivalent rights, phantom stock or other stock-based benefits such as restricted stock units.
Long-Term Incentive Plan 2006
The Company’s shareholders approved the establishment of a Long-Term Incentive Plan in 2006 (the “LTIP”) to provide incentives to certain members of senior management (“Executives”). The Company determines the conditions or restrictions of any awards, which may include requirements of continued employment, individual performance or the Company’s financial performance or other criteria. Currently, the plan only allows for RSUs to be granted under the LTIP.
The following table summarizes the Company’s shares available for grant as options, RSUs or other equity instruments under the LTIP and 2001 Plan:
 
Shares
Available for
Grant
Balance at 31 March 2019 23,744,816 
Granted (800,437)
Balance at 31 March 2020 22,944,379 
Granted (856,756)
Balance at 31 March 2021 22,087,623 
RSUs
The Company estimates the fair value of RSUs on the date of grant and recognizes this estimated fair value as compensation expense over the periods in which the RSU vests.
The following table summarizes the Company’s RSU activity:
(Units) Service
Vesting
(2001 Plan)
Performance
Vesting
(LTIP)
Market
Conditions (LTIP)
Total Weighted
Average Fair
Value at Grant
Date (A$)
Outstanding at 31 March 2019 910,386  1,148,022  2,203,100  4,261,508  14.47 
Granted 24,006  273,258  503,173  800,437  18.08 
Vested (304,591) (207,271) (362,973) (874,835) 16.21 
Forfeited (109,169) (349,844) (565,660) (1,024,673) 15.21 
Outstanding at 31 March 2020 520,632  864,165  1,777,640  3,162,437  14.64 
Granted 371,806  190,376  294,574  856,756  26.56 
Vested (245,385) (174,356) (722,156) (1,141,897) 13.03 
Forfeited (53,567) (153,897) (63,136) (270,600) 17.05 
Outstanding at 31 March 2021 593,486  726,288  1,286,922  2,606,696  19.01 
The following table includes the assumptions used for RSU grants (market condition) valued:
Vesting Condition: Market Market Market Market Market
  FY21 FY21 FY20 FY20 FY20
Date of grant1
15 Sep 2020 5 Nov 2020 25 Feb 2020 20 Sep 2019 9 Aug 2019
Dividend yield (per annum) —  % 1.3  % 2.9  % 3.1  % 3.1  %
Expected volatility 39.2  % 40.1  % 26.6  % 26.6  % 27.8  %
Risk free interest rate 0.2  % 0.2  % 1.2  % 1.6  % 1.6  %
Expected life in years 2.9 2.8 2.5 2.9 2.0
JHX stock price at grant date (A$) 30.33 37.24 29.54 24.69 21.68
Number of restricted stock units 167,491 127,083 6,676 477,979 18,518
Scorecard LTI – CSUs
Under the terms of the LTIP, the Company grants scorecard LTI CSUs to executives and the vesting of awards is based on the individual's performance measured over a three year period against certain performance targets. These awards provide recipients a cash incentive based on an average 20 trading-day closing price of JHI plc’s common stock price and each executive’s scorecard rating.
The following represents the activity related to the CSUs:
FY21 FY20
Granted 571,132  791,217 
Vested 377,506  129,549 
Cancelled 607,253  328,935 
For the fiscal years ending 31 March 2021, 2020 and 2019, US$8.2 million, US$2.0 million and US$2.4 million, respectively, was paid in cash upon vesting of CSU units.