EPS targets in Crown Resorts Ltd's LTI scheme

An ongoing debate in executive remuneration is the use of underlying performance measures. Unlike most other ASX 50 entities, Crown Resorts has a cash based LTI scheme with only a portion of the overall award eligible to vest in that year. In some ways 'LTI' is a misnomer because it reward annual EPS performance, although there is a cumulative EPS goal at year 4 just in case none of the prior years have vested. While the 2010 LTI grant was given an extra year in FY2015 to vest, it failed to do so. However the first year of the new four-year LTI cycle vested at 100% because the Board set different EPS targets. The attached table illustrates the variance in LTI measures over the five years of the 2010 LTI grant. Note the EPS target of 50.5 cents set for the first year of the new LTI cycle was 20.4 cents lower than the target set for the extension year of the 2010 grant. Crown Resorts 2015 AGM is on 21 October 2015.