Stock-based compensation plan

12 Months Ended

Mar. 31, 2020

Share-based Payment Arrangement [Abstract]

The Company has issued share incentives under two equity-classified incentive plans, the TeliMatrix Group Executive Incentive Scheme and the MiX Telematics Long-Term Incentive Plan ("LTIP"), to directors and certain key employees within the Company. Since the introduction of the LTIP during 2014, no further awards have been made in terms of the TeliMatrix Group Executive Incentive Scheme.

The LTIP provides for three types of grants to be issued, namely performance shares, retention shares or stock appreciation rights ("SARs"). To date only SARs and performance shares have been issued.

As of March 31, 2020, there were 60,290,000 shares reserved for future issuance under the LTIP.

The total stock-based compensation expense recognized during the years ended March 31, 2018, 2019 and 2020, was $0.8 million, $0.5 million and $0.7 million, respectively. Deferred tax benefits recognized on total stock-based compensation expense in the Statement of Income for the years ended March 31, 2018, 2019 and 2020, was $0.2 million, $0.1 million and $0.4 million, respectively. Tax benefits realized on awards exercised during the years ended March 31, 2018, 2019 and 2020, was $0.0 million, $0.1 million and $0.2 million, respectively.

Stock options granted under the TeliMatrix Group Executive Incentive Scheme

The options vest in tranches of 25% per annum, commencing on the second anniversary of the grant date and expire 6 years after the grant date. Vesting is contingent upon employment within the Company and an annual total shareholder return in excess of 10% being met, taking into account any dividends paid during the vesting period. The Company has no legal or constructive obligation to repurchase or settle the options in cash.

Management estimates forfeiture to be approximately 5%.

The following table summarizes the Company's stock options for the year ended March 31, 2020:


	Number of Options	Weighted- Average Exercise Price in U.S. Cents*	Weighted-Average Remaining Contractual Term (years)	Aggregate Intrinsic Value*(in thousands)
Outstanding as of April 1, 2019	3,500,000	23





Outstanding as of March 31, 2020	3,500,000	23	0.45	$	385
Vested as of March 31, 2020	3,500,000	23	0.45	$	385

* The exercise price is denominated in South African cents. U.S. currency amounts are based on a ZAR:USD exchange rate of 17.9224 as of March 31, 2020.

No stock options were granted during the years ended March 31, 2018, 2019 and 2020.

The total intrinsic value of stock options exercised during fiscal 2018 and 2019 was $1.75 million and $2.86 million, respectively. U.S. Dollar amounts are based on average ZAR:USD exchange rates for fiscal 2018 and 2019 of 12.9949 and 13.7494, respectively. No options were exercised during the year ended March 31, 2020.

The following table summarizes the Company's unvested stock options for the year ended 31 March 2020:


	Number of Options	Weighted-Average Grant-Date Fair Value in U.S. Cents*
Unvested as of April 1, 2019	875,000	10
Vested	(875,000)	10
Unvested as of March 31, 2020	—

* The exercise price is denominated in South African cents. U.S. currency amounts are based on a ZAR:USD exchange rate of 17.9224 as of March 31, 2020.

Stock appreciation rights granted under the LTIP

Under the LTIP, SARs may be issued to certain directors and key employees. The award price of the SARs granted is equal to the closing market value of ordinary shares on the day preceding the date of grant. The SARs granted vest in tranches of 25% per annum, commencing on the second anniversary of the grant date and expire 6 years after the grant date. Vesting is contingent upon employment within the Company and an annual total shareholder return in excess of 10% being achieved, taking into account any dividends paid during the vesting period, being achieved. Management estimates forfeiture to be approximately 5%. Upon exercise, the Company will settle the value of the difference, between the closing market value of the ordinary shares on the day of settlement and the award price, (if positive), by delivering shares. The Company has no legal or constructive obligation to settle the SARs in cash.

The following table summarizes the Company's SARs for the year ended March 31, 2020:


	Number of SARs	Weighted- Average Award Price in U.S. Cents*	Weighted-Average Remaining Contractual Term (years)	Aggregate Intrinsic Value* (in thousands)
Outstanding as of April 1, 2019	25,921,250	20
Granted	11,625,000	47
Exercised	(3,163,750)	18
Forfeited	(1,438,750)	32
Outstanding as of March 31, 2020	32,943,750	29	3.55
Vested and expected to vest as of March 31, 2020	31,699,063	29	3.53	$	3,129
Vested as of March 31, 2020	8,050,000	18	2.18	$	1,301

* The award price is denominated in South African cents. U.S. currency amounts are based on a ZAR:USD exchange rate of 17.9224 as of March 31, 2020.

The weighted-average grant-date fair value of SARs granted during the years ended March 31, 2018, 2019 and 2020, was 7 U.S. cents, 23 U.S. cents and 18 U.S. cents, respectively. The grant-date fair value was determined using a combination of the Monte Carlo Simulation option pricing model and the Binomial Tree option pricing model. U.S. currency amounts are based on a ZAR:USD exchange rate of 17.9224 as of March 31, 2020.

The total intrinsic value of SARs exercised during fiscal 2018, 2019, and 2020 was $0.14 million, $0.58 million, and $1.01 million, respectively. U.S. Dollar amounts are based on a ZAR:USD exchange rate of 17.9224 as of March 31, 2020.

The following table summarizes the Company's unvested SARs for the year ended March 31, 2020:


	Number of SARs	Weighted- Average Grant-Date Fair Value in U.S. Cents*
Unvested as of April 1, 2019	21,502,500	8
Granted	11,625,000	18
Vested	(6,845,000)	7
Forfeited	(1,388,750)	13
Unvested as of March 31, 2020	24,893,750	12

* The award price is denominated in South African cents. U.S. currency amounts are based on a ZAR:USD exchange rate of 17.9224 as of March 31, 2020.

As of March 31, 2020, there was $1.58 million of unrecognized compensation cost related to unvested SARs. This amount is expected to be recognized over a weighted-average period of 4.3 years.

Performance shares granted under the LTIP

4 million performance shares were granted during fiscal 2019 and fiscal 2020. Vesting was contingent upon employment within the Company and the satisfaction of the following performance targets: cumulative subscription revenue for the years ended March 31, 2019 and 2020 of R3,588 million ($200.2 million at March 31, 2020 exchange rate); and cumulative IFRS-Adjusted EBITDA for the years ended March 31, 2019 and 2020 of R1,322 million ($73.8 million at March 31, 2020 exchange rate). The performance conditions were not met and accordingly all of the performance shares were forfeited. The targets were stretch targets, and from the time of both grant dates it was not considered likely that the performance conditions would be met. As a result, no stock-based compensation expense was recognized in fiscal 2019 or 2020.