CFTC’s advice for collecting or investing 2021 incentives and profit-shares

20 avril 2022

2021 is an exceptional year for Schneider, yet the profit-sharing that will be paid for 2021 will only be 6.87% including the exceptional supplement of 0.4%.
This 6.87% is divided into 0.50% profit-sharing, 5.97% incentive and 0.40% incentive supplement (before social levies of 9.7%)

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You have just received a letter informing you of the amount of your incentive and profit-shares.
You must express your decision to collect or invest your 2021 profit-shares and/or incentive before 5pm on May 11, 2022 at the latest on the website.

  • If you choose to collect your incentive/profit-shares, the amount will appear on your June payslip and will be paid with your salary. The amount will be subject to social levies of 9.7% and income tax.
  • If you decide to invest them, you can choose between several funds depending on the level of risk you wish to take.

If you have not responded by 5 p.m. on May 11, 2022:
• Your profit-shares will be automatically invested: 50% in the employee savings plan in the Schneider Monétaire fund and 50% in the PERECO managed retirement fund (with no matching contribution for the latter).
• Your incentive will be automatically invested in the employee savings plan in the “Schneider Monétaire” fund.

​Information on the performance of the group’s employee savings plan (PEG) at mid-April 2022

The year 2021 was excellent for the equity markets, allowing the CAC 40 to rise by +29%. The war in Ukraine, which started in February 2022, reversed the trend with a stock market decline of -9%. High inflation should lead to a rise in interest rates with a risk for growth; this will lead to variations in the PEG funds: bonds will fall, money market funds will rise, and equities will evolve according to growth prospects (with a risk in 2022).
​Some experts fear a "Stagflation" (contraction of the words Stagnation and Inflation), a period of high inflation without associated growth.

Performance of the employee savings plan for 5 years and trends.

The Schneider "Actionnariat fund" is up +162% over 5 years.
​This fund, 100% invested in Schneider shares, reflects increases or decreases of he stock to which the dividend is added each year. The share has risen more than the CAC 40 over the last 5 years but has fallen since the beginning of the year due to geopolitical uncertainties.
The WESOP plan will allow you to buy shares at a 15% discount to the average opening price of the 20 trading sessions preceding 20 April. This means a purchase price of €126.5 for a share price of around €140 today.

The Schneider Dynamique fund increased by 30% over 5 years.

This fund, which is currently 95% invested in equities, has a high level of risk and is very dependent on the stock markets, which after 18 months of very strong growth, are now suffering from the uncertainties linked to the war in Ukraine.

The Schneider Diversifié fund has increased by 15% over 5 years.

It includes both shares (55%) and bonds (45%). Bonds temper the volatility of equities. Since the beginning of the year, it has been affected by the fall in the stock market (-8%) but also in bonds (-3%). Bonds will continue to fall as long rates rise.

The Schneider Energie Solidaire fund is low risk, but has lost 0.3% over 5 years.

It is a socially responsible fund (SRI), invested 95% in bonds with “safe” issuers (ISR) that meet social and environmental criteria. The other 5% is invested in socially responsible companies aiming to improve access to energy. Due to its policy, this fund will follow the bond market.

The Schneider Monétaire fund is very low risk but performance has been slightly negative for several years.

​By the end of 2022 this situation could change as central banks are expected to raise rates to counter inflation

Savings you invested in 2017 will be available on 1 June 2022 for sums resulting from incentives and matching contributions. You can withdraw part of this amount or make other decisions.


Why save in the employee savings plan?

If you decide to invest all or part of your incentive/shares, you enjoy several benefits in exchange for a 5-year freeze, until 31 May 2027, except in the case of early withdrawal (*):

  • Tax exemption on the sums invested (except social levies of 9.7%).
  • Matching contributions reach €1,404 gross (before 9.7% social levies) which offsets risks of capital loss depending on the funds chosen.

(*) Anticipated withdrawal: purchase or extension of the primary residence, marriage, civil union, birth/adoption of third child, divorce, separation, dissolution of civil union with custody of at least one child, domestic violence, invalidity (employee, spouse or civil partner, child), death (employee, spouse or civil partner), termination of employment contract, excessive debts.

Advice for saving your incentive and profit-shares and more .

Cautious ?

  • Invest €700 in low-risk funds such as Schneider Monétaire or Schneider Energie Solidaire. With 100% matching contribution (i.e. €700 gross), you will have around €1,268 net in 5 years assuming the return close to zero of such low-risk investments and after social levies of 9.7% on the amounts invested and the matching contribution.
  • To benefit from the remaining €704 gross matching contribution, invest €2,012 in the Schneider Actionnariat fund (Classic offer) so that any risk is partially offset by the matching contribution.
  • Invest the remaining amount, without matching contribution, in low-risk funds without expectation of return, for the sole purpose of avoiding tax, for example in the Schneider Actionnariat fund (Classic offer) to take advantage of the 15% discount. In this case, there is a risk for invested capital in the event of a significant decrease in shares on the date of withdrawal that is higher than the purchase discount.

More daring?

Willing to take a higher risk with invested capital?
​Invest the total in the Schneider Actionnariat fund (Classic offer) with 85% gross matching contribution (€595) for the first €700 invested, then 35% gross matching contribution (€809) for the following €2,312. You can also mix your investments:
Invest the first €700 in the Schneider Diversifié or Schneider Dynamique funds. Capital risk is reduced by 100% by the matching contribution. Invest the remaining amount in the Schneider Classic fund, with 35% matching contribution for the following €2,012.
Employees are free to invest more than their incentive and profit-shares: up to 25% of their annual gross salary in Schneider Actionnariat in the employee savings plan to benefit from the 15% discount.

Saving your incentive/profit-shares with the group savings plan is advantageous, but the CFTC requests:

  • An increase in matching contributions which have not changed for 20 years

  • Realistic incentive criteria.