Interest-bearing debt

Movements in interest-bearing debt:

The maturities of the interest-bearing debts are presented below:

Most interest-bearing debts as at 31 December 2021 were contracted by Stedin Holding N.V., and no collateral has been provided. More information on interest-bearing debt is included in 33 Financial risk management.

The lease liabilities that are capitalised as of 1 January 2019 as a result of the application of IFRS 16 are included in interest-bearing debt. For information on right-of-use assets, see 16 Right-of-use assets.

The total lease liability as at 31 December 2021 was €74 million (2020: €81 million). The maturities of this lease liability are: €13 million within one year, €31 million from one to five years and €30 million after five years.

There is no liquidity risk for the lease liabilities arising from right-of-use assets. The lease liabilities are monitored by the Corporate Control department.

The following significant financing transactions took place in 2021:

• Equity was strengthened by issuing €200 million in preference shares to some of the existing shareholders.
• In May 2021, Stedin redeemed USD and GBP bond loans; in total, €196 million in principal was redeemed, part of which was redeemed early at a premium of €38 million. As a result of this early redemption, the financing expenses for these loans were brought forward, which gave rise to an one-off interest expense in 2021. This is offset by lower interest expenses for future years. Both loans are refinanced via active Stedin Group financing programmes.
• The €500 million hybrid financing dating from 2014 was redeemed with a tender offer to investors and replaced with a new €500 million hybrid issue with a call date in 2027 and a coupon of 1.5%
• A new five-year green bond loan of €500 million with an interest coupon of 0.0% was issued under the Euro Medium Term Note programme and Green Finance Framework, which were updated.

Some of the loans are subject to financial covenants, which are set out below:

• a gearing ratio (Total net borrowings / Total capitalisation) lower than 70%;
• an interest coverage ratio (EBITDA / net interest expense) higher than 3.

The above ranges for ratios are assessed at the end of each measurement period.

The following definitions apply:

• Measurement period: 12-month moving average per 31 December and 30 June of each financial year.
• Total net borrowings: sum of current and non-current interest-bearing debt, minus cash and cash equivalents.
• Total capitalisation: sum of current and non-current interest-bearing debt and total group equity adjusted for goodwill, intangible assets and minority interests.
• EBITDA: profit before income tax, adjusted for depreciation, amortisation, net interest payable, profit of group entities sold, revaluations, one-off items and share of minority interests.
• Net interest expense: sum of financial income and expenses.

The tables below show that Stedin Holding N.V. complied with the conditions stated above during 2021.