Integrated report 2021

20. Equity



Equity is stated at nominal value, classified by nature, in accordance with legal regulations and the Company’s Articles of Association.

Share capital, reserve capital and other capital reserves in the consolidated financial statements are the ones of the parent company. Hedging reserve, foreign exchange differences from translation on foreign entities and retained earnings include both the amounts deriving from the financial statements of the parent company and the relevant portion of the subsidiaries’ equity, established in accordance with the consolidation principles. Declared, but not contributed, share capital contributions are recognised as outstanding share capital contributions as negative value.

In the consolidated statement of financial position equity is divided into:

  • Equity attributable to equity holders of the parent company,
    Equity attributable to non-controlling interests

The objective of equity management is to ensure a secure and effective financing structure that takes into account operational risk, investment expenditures and the interests of shareholders and debt investors. Equity management takes places at Group level.

In line with common practices, the Group monitors its net debt to EBITDA ratio at the Group level. Net debt is understood as short- and long-term financial debt (interest-bearing loans and borrowings, bonds and other debt securities issued, as well as lease liabilities), less cash and cash equivalents, and short-term deposits. Restricted cash is not included in calculating net debt.

The Group’s aim is to maintain its investment grade credit ratings. In connection with the ongoing investment program, leverage is planned to increase in the coming years. The net debt to EBITDA ratio is a central element of the Group’s financial forecasts and plans.

Year ended December 31, 2021 Year ended December 31, 2020 restated data*
Net debt / EBITDA 0.44x 1.22x
Net debt / equity 0.09x 0.17x
* In order to standardise the reporting of net debt (adjustment to the method of calculating covenants contained in loan agreements), starting from the results for the first half of 2021, there has been a change in presentation, which also results in a change in the comparative period, i.e. only funds in client accounts of PGE Dom Maklerski S.A. constituting collateral for settlements with clearinghouse IRGiT are included in restricted funds.


20.1 Share capital

20.2 Reserve capital

20.3 Hedging reserve

20.4 Foreign exchange differences from translation

20.5 Retained earnings and limitations on payment of dividend

20.6 Equity attributable to non-controlling interests

20.7 Earnings per share

20.8 Dividends paid and recommended for payment

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