Corporate News

ENCAVIS benefits several times from early mandatory conversion of hybrid convertible bonds issued in 2017 and 2019


Hamburg, August 31, 2021 - The MDAX listed Hamburg based solar and wind park operator Encavis AG (ISIN: DE0006095003, Prime Standard, stock exchange symbol: ECV, the "Company") benefits several times from the early mandatory conversion of the perpetual subordinated bonds (ISIN DE000A19NPE8, the "Bonds") issued through its wholly owned subsidiary Encavis Finance B.V.

The annual interest savings of around EUR 7.85 million (5.25% x EUR 149.5 million) from the conversion of the bond are offset by additional charges resulting from the increased number of shares. On the one hand, the increased number of shares dilutes the Company's earnings per share (EPS). However, this effect is partly offset by the interest savings with a full-year effect of around EUR 7.85 million. In 2021, the net effect will be an EPS charge of EUR 0.01 at most. Likewise, the additional dividend to be paid of around EUR 6.33 million (2021e: EUR 0.30 x 21.1 million new shares) on the new shares to be issued will be more than compensated for by the annual interest savings.

The medium-term target of increasing EPS to EUR 0.70 in 2025e, in line with the >> Fast Forward 2025 growth strategy, already includes the conversion of the bonds and is calculated on the correspondingly increased number of shares. Likewise, the analysts' valuations and their target prices for the Encavis share are already based on the correspondingly increased number of approximately 160.5 million shares.

The accounting effect of the conversion is a pure liability swap within equity from equity attributable to hybrid capital investors to capital reserves in equity. Equity, balance sheet total and equity ratio remain unchanged.

The approximately 21.1 million new shares to be issued as a result of the conversion of the bonds will not only increase the total number of outstanding shares to approximately 160.5 million shares (currently 139.4 million shares), they will also increase the free float proportion of Encavis shares tradable on the stock exchange by the same amount. The free float would thus increase from the current 72.4% to 76.2%. Ranking and index membership within the DAX family of Deutsche Börse AG are calculated on the basis of the free float market capitalisation.

The mandatory conversion of still outstanding Bonds in an aggregate principal amount of EUR 149.5 million, initially issued on September 13, 2017 as well as on September 5, 2019, shall take place at the conversion price of EUR 7,0836. Each bond will be converted into the number of shares of the Company calculated by dividing the nominal amount of the bonds to be converted by the conversion price. The Company intends to create the required shares from the Conditional Capital 2017 and 2018 and from the Authorised Capital 2021.

Encavis expected already a conversion of a major part of the Hybrid Convertible Bond after the next interest payment, dated on September 13, 2021. The early mandatory conversion in one transaction instead of multiple individual conversions simplifies and increases efficiency of the conversion process significantly. The early mandatory conversion will take place on October 4, 2021.

About ENCAVIS:
Encavis AG (Prime Standard; ISIN: DE0006095003; ticker symbol: ECV) is a producer of electricity from renewable energies listed on the MDAX of Deutsche Börse AG. As one of the leading independent power producers (IPP), ENCAVIS acquires and operates solar parks and (onshore) wind farms in ten European countries. The plants for sustainable energy production generate stable yields through guaranteed feed-in tariffs (FIT) or long-term power purchase agreements (PPA). The Encavis Group's total generation capacity currently adds up to more than 2.8 gigawatts (GW), which corresponds to a total saving of 1.26 million tonnes of CO₂ per year. Within the Encavis Group, Encavis Asset Management AG offers fund services to institutional investors.

Encavis is a signatory of the UN Global Compact as well as of the UN PRI network. Encavis AG's environmental, social and governance performance has been awarded by two of the world's leading ESG rating agencies. MSCI ESG Ratings awarded the corporate ESG performance with "AA" and ISS ESG with their "Prime" label.

Additional information can be found on www.encavis.com

Contact:
Encavis AG
Jörg Peters
Head of Corporate Communications & IR
Tel.: + 49 (0)40 37 85 62 242
E-Mail: [email protected]