Silence Therapeutics plc Stock Compensation Disclosure
20. Equity-settled share-based compensation
The Group has issued share options under the 2018 Long Term Incentive Plan (“LTIP”), 2018 Non-Employee Long Term Inventive Plan (“Non-Employee LTIP”), and individual share option contracts, open to all employees of the Group, as well as EMI shares (none of which remain outstanding at December 31, 2024). Under the 2023 Plan, LTIP, Non-Employee LTIP, individual contracts and schemes available, the options typically vest after three years, with the exception of some options granted to certain members of key management personnel. The vesting period for these options ranges from 3 to 33 months. The options usually lapse after one year following the employee leaving the Group.
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2025 |
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2024 |
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Number of |
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Weighted |
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Aggregate Intrinsic Value |
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Number of |
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Weighted |
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Aggregate Intrinsic Value |
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$ |
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$ |
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$ |
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$ |
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Options |
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Outstanding at the beginning of the year |
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5,818,463 |
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15.95 |
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5,284,486 |
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14.80 |
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Granted during the year |
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1,966,485 |
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6.96 |
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1,267,514 |
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18.05 |
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Lapsed or forfeited during the year |
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(814,324 |
) |
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13.11 |
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(264,056 |
) |
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19.82 |
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Exercised during the year |
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(9,258 |
) |
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1.65 |
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(469,481 |
) |
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6.55 |
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Outstanding at the year-end (ADS/$) |
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6,961,366 |
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13.76 |
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- |
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5,818,463 |
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15.95 |
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- |
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Exercisable at the year-end |
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4,211,644 |
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16.12 |
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2,870,106 |
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15.94 |
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The table above shows the number of options in relation to ordinary shares and equivalent ADSs outstanding and exercisable at year end, on the conversion ratio of three ordinary share options to one ADS.
The options outstanding at the year-end have a weighted average remaining contractual life of 7.28 years (2024: 7.7 years).
As of December 31, 2025, there was $6.0 million of total unrecognized compensation cost related to stock options granted but not vested under the Company’s plans. That cost will be recognized over an expected remaining weighted-average period of 1.3 years.
In the years ended December 31, 2025 and 2024 the total intrinsic value of stock options exercised was negligible and $6.8 million, respectively. The weighted average share price at the date of exercise of the options during the year was $1.65 per ADS (2024: $20.99).
The Group granted 5,899,455 share options during the year (2024: 3,802,542). The fair value of options granted were calculated using Black Scholes model. Inputs into the model were as follows:
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2025 |
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2024 |
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Inputs and assumptions for options granted in the year: |
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Weighted average ADS price ($) |
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7.0 |
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18.1 |
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Option life (years) |
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6.2 |
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6.2 |
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Expected volatility |
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77.5%-79.8% |
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74.4%-78.6% |
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Risk free rate |
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3.75%-4.7% |
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3.39%-3.97% |
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Expected dividend yield |
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nil |
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nil |
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Weighted average grant date fair value ($) |
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6.93 |
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12.6 |
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The Group recognized total charges of $8.1 million (2024: $16.3 million) related to equity settled share-based payment transactions during the year. The decrease in costs for share-based payments is largely due to credit of previously accrued expense for those grants forfeited or cancelled due to reduction in number of employees, as well as lower fair value of 2025 issued grants.
The Group does not bear any responsibility to settle any employee tax obligations that arise on the exercise of share options. The estimated employer tax obligation on outstanding options at the year-end was negligible for 2025 and 2024.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 5, 2026 | Showing above |
| 2024 | Feb 27, 2025 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.