Q2 2021 Financial Highlights and Offshore Wind Build-Out Plan
Hybrid capital in short
Hybrid capital can broadly be defined as funding
instruments that combine features of debt and
equity in a cost-efficient manner:
•
•
•
Hybrid capital encompasses the credit-
supportive features of equity and improves
rating ratios
Perpetual or long-dated final maturity (1,000
years for Ørsted)
Absolute discretion to defer coupon payments
and such deferrals do not constitute default nor
trigger cross-default
Deeply subordinated and only senior to
common equity
Without being dilutive to equity holders (no
ownership and voting rights, no right to
dividend)
Hybrids issued by
Due to hybrid's equity-like features, rating
agencies assign equity content to the hybrids when
calculating central rating ratios (e.g. FFO/NIBD).
The hybrid capital increases Ørsted's investment
capacity and supports our growth strategy and
rating target.
Ørsted has made use of hybrid capital to maintain
our ratings at target level in connection with the
merger with Danish power distribution and
production companies back in 2006 and in recent
years to support our growth in the offshore wind
sector.
Accounting treatment
•
•
•
Hybrid bonds are classified as equity
Coupon payments are recognised in equity and
do not have any effect on profit (loss) for the
year
Coupon payments are recognised in the
statement of cash flows in the same way as
dividend payments
For further information see note 6.3 in the 2020
Annual Report
Accounting
treatment²
Ørsted A/S¹
Principal
amount
6.25% hybrid due 3013
EUR 350 m
Туре
Hybrid capital
(subordinated)
First
par call
Coupon
Jun. 2023
2.25% Green hybrid due 3017
EUR 500 m
1.75% Green hybrid due 3019
EUR 600 m
1.50% Green hybrid due 3021
EUR 500 m
Hybrid capital
(subordinated)
Hybrid capital
(subordinated)
Hybrid capital
(subordinated)
Nov. 2024
Dec. 2027
Feb. 2031
2.50% Green hybrid due 3021
GBP 425 m
Hybrid capital
(subordinated)
Feb. 2033
Fixed during the first 10 years,
first 25bp step-up in Jun. 2023
Fixed during the first 7 years,
first 25bp step-up in Nov. 2029
Fixed during the first 8 years,
first 25bp step-up in Dec. 2032
Fixed during the first 10 years,
first 25bp step-up in Feb. 2031
Fixed during the first 12 years,
first 25bp step-up in Feb. 2033
100% equity
100% equity
100% equity
100% equity
100% equity
35
Ταχ
treatment
Debt tax-deductible
coupon payments
Debt tax-deductible
coupon payments
Debt tax-deductible
coupon payments
Debt tax-deductible
coupon payments
Debt - tax-deductible
coupon payments
1. All listed on Luxembourg Stock Exchange and rated Baa3 (Moody's), BB+ (S&P) and BBB- (Fitch). The four Green hybrids are furthermore listed on the Luxembourg Green Exchange (LGX)
2. Due to the 1,000-year structure
Rating
treatment
50% equity,
50% debt
50% equity,
50% debt
50% equity,
50% debt
50% equity,
50% debt
50% equity,
50% debt
OrstedView entire presentation