22. Capital management

The Board of Directors is responsible for monitoring and managing the Group’s capital structure, which comprises equity (share capital and additional paid-in capital) as well as loans and borrowings.

The policy of the Board of Directors is to maintain an acceptable capital base to give confidence to the Group’s shareholders and debtholders, and to sustain the future development of the business. The Board of Directors monitors the Group’s financial position to ensure that it complies at all times with its financial and other covenants as set out in the indenture governing the senior unsecured notes, two unsecured Schuldscheindarlehen (“SSD”, a private German debt placement) agreements and the other credit agreements, as well as to ensure the payment of an appropriate level of dividends to the shareholders.

The Company purchases its own shares on the market. The repurchased shares are intended to be used to settle obligations under the Group’s equity-settled share-based payment plans and arrangements (see also notes 25 and 30).

In order to maintain or adjust the capital structure, the Board of Directors may elect to take a number of measures, for example disposing of assets of the business, altering its short- to medium-term plans with respect to capital projects and working capital levels, or rebalancing the level of equity and debt in place.

Net debt and net leverage

As part of monitoring the Group’s financial position, the Board of Directors evaluates the Group’s net debt and development of its net leverage ratio. Net leverage is defined by the Group as net debt divided by adjusted EBITDA. Net debt comprises the Group’s current and non-current loans and borrowings (including lease liabilities, and with notes and credit facilities at principal amounts) less cash and cash equivalents (including any restricted cash). See note 9 for the definition of adjusted EBITDA. See note 23 for additional details about the Group’s loans and borrowings and loan covenants relating to the Group’s net leverage.

The table below presents the components of net debt and the net leverage ratio.

The net debt as of December 31, 2024 remained at the same level as of December 31, 2023. The adjusted EBITDA performance positively contributed to the net leverage ratio.