Share split
The Annual General Meeting of Krka, d. d., Novo mesto adopted a resolution on 5 July 2007 to split shares 1 : 10, which meant that one share was divided into ten new shares. The aim was to increase trading liquidity and accessibility of shares to a broader investor base.
After the share split, each shareholder held ten times more shares than before, while the value of each individual share was ten times lower than before. The split did not alter the total value of shareholder investments in Krka shares.
Krka split its shares at the beginning of September 2007, ensuring minimal disruption to trading with the shares and proper information to shareholders and the general public.
REASONS FOR SHARE SPLIT
Before the split, Krka shares were valued at around €1,000 per share, a large sum at that time for individuals, who accounted and still account for the largest group of investors in Krka shares. The average net salary in Slovenia was lower than the price of one Krka share.
An individual who had saved €500 and wanted to invest these savings in Krka shares could not do so because it is not possible to buy only half a share. After the share split, the same investor could buy Krka shares given that one share represented a ten times smaller ownership stake in Krka, with the value of share being approximately ten times lower.
A Krka shareholder who needed €500 was in a similar situation. To cash out, the shareholder had to sell the whole share worth €1,000, even if he or she would rather have kept the remaining €500 in Krka shares.
Krka split its shares to attract investors and facilitate management of our shares.
EXAMPLE
I had 20 Krka shares before the share split. The price per share was €1,000, which means that the total value of my holding was approximately €20,000. What was the value of my investment after the share split?
The share split had no direct impact on the total value of your investment in Krka shares. After the split, the number of your shares was ten times higher, while the value per share was ten times lower.
| AFTER SHARE SPLIT | ||
|---|---|---|
| Number of shares | 20 shares | 20 shares x 10 = 200 shares |
| Price per share | €1.000 | €1,000 / 10 = €100 |
| Investment total | 20 x €1,000 = €20,000 | 200 x 100 = €20,000 |
Selected pre-split share figures
| 1 Dec 1998 | 31 Dec 1999 | 31 Dec 2000 | 31 Dec 2001 | 31 Dec 2002 | 31 Dec 2003 | **31 Dec 2004 | **31 Dec 2005 | **31 Dec 2006 | |
| Share price (SIT) | 25.009 | 25.784 | 27.392 | 28.711 | 42.458 | 52.188 | 84.482 | 102.342 | 188.057 |
| Share price (€) | 132,37 | 130,67 | 129,51 | 129,67 | 184,39 | 220,49 | 352,39 | 427,18 | 784,75 |
| Earnings per share (SIT) | 1.116 | 1.029 | 1.865 | 2.405 | 3.116 | 2.970 | 4.627 | 6.890 | 7.918 |
| Earnings per share (€) | 5,91 | 5,21 | 8,82 | 10,86 | 13,53 | 12,55 | 19,3 | 28,76 | 33,04 |
| Price-earnings ratio per share | 22,4 | 25,1 | 14,7 | 11,9 | 13,6 | 17,6 | 18,3 | 14,9 | 23,8 |
| Dividend per share (SIT) | 450 | 550 | 700 | 950 | 1.050 | 1.200 | 1.400 | 1.650 | 1.917,12 |
| Dividend per share (€) | 2,29 | 2,65 | 3,21 | 4,17 | 4,47 | 5 | 5,84 | 6,89 | 8 |
| Market capitalisation (SIT billion) | 88,6 | 91,3 | 97 | 101,7 | 150,4 | 184,9 | 299,3 | 362,6 | 666,2 |
| Market capitalisation (€ million) | 469 | 463 | 459 | 459 | 653 | 781 | 1.248 | 1.514 | 2.780 |
| Number of shares issued | 3.542.612 | 3.542.612 | 3.542.612 | 3.542.612 | 3.542.612 | 3.542.612 | 3.542.612 | 3.542.612 | 3.542.612 |
| Number of shareholders | 64.756 | 58.445 | 54.684 | 50.956 | 51.510 | 52.370 | 54.911 | 53.635 | 54.555 |
** IFRS
The euro-denominated value before its adoption is calculated based on the average foreign exchange rate of the Bank of Slovenia effective on the date stated in each column title.
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