17. Equity

SHARE CAPITAL (INCL. DISCLOSURES IN ACCORDANCE WITH SECTION 241 AUSTRIAN COMMERCIAL CODE (UNTERNEHMENSGESETZBUCH – UGB))

As of March 31, 2024, the share capital is EUR 324,391,840.99 (March 31, 2023: EUR 324,391,840.99) and is divided into 178,549,163 (March 31, 2023: 178,549,163) no-par value bearer shares. All shares are fully paid in.

Under Article 4 (2a) of the Articles of Association, the Management Board of voestalpine AG is authorized until June 30, 2024, to increase the company’s share capital with the approval of the Supervisory Board by up to EUR 64,878,368.92 by issuing up to 35,709,833 shares (= 20%) in return for cash contributions—if necessary, in several tranches (Authorized Capital 2019/I). The Management Board has not exercised this authorization up until now.

Under Article 4 (2b) of the Articles of Association, the Management Board of voestalpine AG is authorized until June 30, 2024, to increase the company’s share capital by up to EUR 32,439,183.55 with the approval of the Supervisory Board by issuing up to 17,854,916 shares (= 10%) in return for contributions in kind and/or in cash for the purpose of issuing shares to employees, executives, and members of the Management Board of the company or an affiliated company—if necessary in several tranches—as well as to exclude shareholders’ subscription right (i) if the capital increase is made in return for contributions in kind, i.e., if shares are issued for the purpose of acquiring companies, operations, or partial operations, or if shares are issued for one or more companies located in Austria or abroad; or (ii) if the capital increase is carried out for the purpose of issuing shares to employees, executives, and members of the Management Board of the company or an affiliated company in the context of an employee shareholding scheme (Authorized Capital 2019/II). The Management Board has not exercised this authorization up until now.

Under Article 4 (6) of the Articles of Association, the Management Board of voestalpine AG is authorized to increase the share capital of the company by up to EUR 31,330,922.84 by issuing up to 17,244,916 ordinary no-par value bearer shares (= 10%) to be issued to creditors of financial instruments as defined in Section 174 Austrian Stock Corporation Act (Aktiengesetz – AktG) (convertible bonds, income bonds, or participation rights); the Management Board was authorized to issue these shares at the Annual General Meeting on July 3, 2019 (Contingent Capital Increase). To date, the Management Board has not exercised the authorization to issue financial instruments as defined in Section 174 Austrian Stock Corporation Act. On April 19, 2023, the Management Board exercised the authorization to issue financial instruments as defined in Section 174 Austrian Stock Corporation Act (Aktiengesetz – AktG) (convertible bonds, income bonds or participation rights) and issued a non-subordinated, unsecured convertible bond due in 2028 with a total nominal value of EUR 250 million (ISIN AT0000A33R11), which was initially convertible into up to 6,113,740 new and/or existing shares.

If the dividend of voestalpine AG is more than EUR 1.20 per share, the conversion price is reduced. Due to the dividend of EUR 1.50 per share in July 2023, the conversion price has been reduced from EUR 40.8915 to EUR 40.4874 and the reference dividend is adjusted from EUR 1.20 to EUR 1.1881 per share. The adjustment of the conversion price serves as protection against dilution. The equity component of the convertible bond amounts to EUR 18.8 million. The convertible bonds are considered potential ordinary shares and are included in the calculation of diluted earnings per share from the date of issue if they have a dilutive effect on earnings per share. The convertible bond has no dilutive effect on earnings as of March 31, 2024 and is therefore not included in the calculation of basic earnings per share. See also Note 31. Earnings per share.

At the Annual General Meeting on July 7, 2021, the Management Board was authorized for a period of 30 months to repurchase treasury shares representing up to 10% of the respective share capital. The buyback price may not be more than 20% less than or 10% higher than the average closing price of the shares on the three market trading days prior to the buyback. The Management Board exercised this authorization on November 3, 2022, and resolved a buyback program involving up to 10,000,000 ordinary shares (= about 5.6% of the share capital) starting on November 10, 2022, and likely ending on July 10, 2023. The buyback program was completed as planned on July 10, 2023. A total of 7,070,000 ordinary shares with a total value of EUR 213.1 million were bought back as part of this buyback program. The number of repurchased shares in the 2023/24 business year amounted to 1,200,327 ordinary shares with a total value of EUR 37.3 million.

At the Annual General Meeting on July 5, 2023, the Management Board was authorized for a period of 30 months to repurchase treasury shares representing up to 10% of the respective share capital. The buyback price may not be more than 20% less than or 10% higher than the average closing price of the shares on the three market trading days prior to the buyback. The Management Board has not exercised this authorization up until now.

Capital reserves mainly include the share premium (net of capital funding costs), gains/losses from the sale of treasury shares, the equity component of the convertible bond and share-based compensation.

Reserves for treasury shares include the deducted acquisition cost and/or the increase in equity from disposals of treasury shares at cost.

Retained earnings include the profit after tax less dividend distributions. When majority interests are increased or decreased, the difference between the acquisition cost of the additional shares and the prorated carrying amount of the non-controlling interests is recognized directly in retained earnings. Actuarial gains and losses from provisions for severance payments and pension obligations are recognized directly and in full in retained earnings in the year in which they are incurred.

The translation reserve serves to cover all foreign currency differences arising from the translation of the financial statements of foreign subsidiaries.

The hedging reserve comprises gains and losses from the effective portion of the cash flow hedges. The cumulative gains or losses from hedged transactions recognized in the reserves are not recognized in the income statement until the hedged transaction also affects the earnings.

The number of shares outstanding for the periods presented in the Consolidated Financial Statements as of March 31, 2024, has changed as follows:

SHARE-BASED COMPENSATION

As part of the practice of granting employees voestalpine shares in connection with the annual performance bonus, 141.7 thousand shares with a fair value of EUR 4.7 million (2022/23: EUR 4.7 million) were removed from equity for this purpose, and 70.1 thousand shares with a value of EUR 1.8 million (2022/23: EUR 4.6 million) were added to equity.