The Company manages capital to ensure that all group enterprises will be able to continue as going concern while maximizing the return to shareholders through the optimization of debt and equity balances. The overall strategy in this regard has remained unchanged since 2012.

The Company’s capital structure consists of equity and external debt obtained through issuance of convertible notes. The Company is not subject to any externally imposed capital requirements or covenants. The capital structure is reviewed on an ongoing basis for the adequacy of the Company’s capital compared to the resources required for carrying out ordinary activities.

Development in the Company’s share capital and treasury shares reserves are described in the following sections. Other equity reserves are described in Note 2 “Summary of Significant Accounting Policies”.

The share capital of Ascendis Pharma A/S consists of 57,152,295 fully paid shares at a nominal value of DKK 1, all in the same share class.

The number of outstanding shares of the Company are as follows:


	2022		2021		2020		2019		2018
	(Number)
Changes in share capital
At January 1		56,937,682		53,750,386		47,985,837		42,135,448		36,984,292
Increase through cash contributions		214,613		3,187,296		5,764,549		5,850,389		5,151,156
At December 31		57,152,295		56,937,682		53,750,386		47,985,837		42,135,448

The holding of treasury shares are as follows:


	Nominal value			Holding			Holding in % of total outstanding shares
	(EUR’000)			(Number)
Treasury shares
At January 1, 2021		—			—			—
Acquired from third parties		21			154,837			—
At December 31, 2021		21			154,837			0.3	%
Acquired from third parties		134			1,000,000			—
Transferred under stock incentive programs		(6	)		(41,685	)		—
At December 31, 2022		149			1,113,152			2.0	%

The Company regularly monitors the access to domestic and international financial markets, manages the financial risks relating to its operations, and analyze exposures to risk, including market risk, such as foreign currency risk and interest rate risk, credit risk and liquidity risk.

The Company’s financial risk exposure and risk management policies are described in the following sections.

The Company’s activities expose the group enterprises to the financial risks of changes in foreign currency exchange rates and interest rates. Derivative financial instruments are not applied to manage exposure to such risks.

The Company is exposed to foreign currency exchange risks arising from various currency exposures, primarily with respect to the U.S. Dollar (“USD”).

Foreign currency exchange risks are unchanged to prior year, and primarily relate to sale and purchases in foreign currencies, and cash, cash equivalents and marketable securities, countered by convertible notes. The exposure from foreign currency exchange risks is managed by maintaining cash positions in the currencies in which the majority of future expenses are denominated, and payments are made from those reserves.

The following table details how a strengthening of the USD against the EUR would impact profit and loss, and equity before tax at the reporting date. A similar weakening of the USD would have the opposite effect with similar amounts. A positive number indicates an increase in profit or loss and equity before tax, while a negative number indicates the opposite. The sensitivity analysis is deemed representative of the inherent foreign currency exchange risk associated with the operations.


			Hypothetical impact on consolidated financial statements
	Nominal positions (net)		Increase in foreign currency exchange rate			Profit and loss before tax		Equity before tax
	(EUR ‘000)
USD/EUR
December 31, 2022		60,581		10	%		6,058		6,058
December 31, 2021		549,243		10	%		54,924		54,924

Outstanding convertible notes comprise a 2.25% coupon fixed rate structure. In addition, interest rate on lease liabilities is fixed at the lease commencement date. Future indebtedness including those related to lease arrangements, if any, may be subject to higher interest rates. In addition, future interest income from interest-bearing bank deposits and marketable securities may fall short of expectations due to changes in interest rates.

Rate structure of marketable securities are specified below:


	December 31, 2022				December 31, 2021
	Carrying amount		Fair value		Carrying amount		Fair value
	(EUR’000)
Marketable securities specified by rate structure
Fixed rate		205,825		203,543		323,176		322,556
Floating rate		11,787		11,773		17,975		17,968
Zero-coupon		80,568		80,527		2,207		2,207
Total marketable securities		298,180		295,843		343,358		342,731

Derivative liabilities are measured at fair value through profit or loss. Accordingly, since the fair value is exposed from the development in interest rates, the profit or loss is exposed to volatility from such development. The effects of interest rate fluctuations are not considered a material risk to the Company’s financial position. Accordingly, no interest sensitivity analysis has been presented.

The Company has adopted an investment policy with the primary purpose of preserving capital, fulfilling liquidity needs and diversifying the risks associated with cash, cash equivalents and marketable securities. This investment policy establishes minimum ratings for institutions with which the Company holds cash and cash equivalents, as well as rating and concentration limits for marketable securities held.

The exposure to credit risk primarily relates to cash, cash equivalents, and marketable securities. The credit risk on bank deposits is limited because the counterparties, holding significant deposits, are banks with minimum credit-ratings of A3/A- assigned by international credit-rating agencies. The banks are reviewed on a regular basis and deposits may be transferred during the year to mitigate credit risk. In order to mitigate the concentration of credit risks on bank deposits and to preserve capital, a portion of the bank deposits have been placed into primarily U.S. government bonds, treasury bills, corporate bonds, and agency bonds. The Company’s investment policy, approved by the Board of Directors, only allows investment in marketable securities having investment grade credit-ratings, assigned by international credit-rating agencies. Accordingly, the risk from probability of default is low. On each reporting date, the risk of expected credit loss on bank deposits and marketable securities, including the hypothetical impact arising from the probability of default is considered in conjunction with the expected loss caused by default by banks or securities with similar credit-ratings and attributes. In line with previous periods, this assessment did not reveal a material impairment loss, and accordingly no provision for expected credit loss has been recognized.

Marketable securities specified by investment grade credit rating are specified below:


	December 31, 2022				December 31, 2021
	Carrying amount		Fair value		Carrying amount		Fair value
	(EUR’000)
Marketable securities specified by investment grade credit rating
High grade		203,530		202,048		144,307		144,030
Upper medium grade		94,650		93,795		196,909		196,566
Lower medium grade		—		—		2,142		2,135
Total marketable securities		298,180		295,843		343,358		342,731

At the reporting dates, there are no significant overdue trade receivable balances. As a result, write-down to accommodate expected credit-losses is not deemed material.

Historically, the risk of insufficient funds has been addressed through proceeds from sale of the Company’s securities in private and public offerings and in 2022, through issuance of convertible notes.

Liquidity risk is managed by maintaining adequate cash reserves and banking facilities, and by matching the maturity profiles of marketable securities with cash-forecasts. The risk of shortage of funds is monitored, using a liquidity planning tool, to ensure sufficient funds are available to settle liabilities as they fall due.

Besides marketable securities and deposits, the Company’s financial assets are recoverable within twelve months after the reporting date. The composition of the marketable securities portfolio and its maturity profiles are specified in the following table.


	December 31, 2022				December 31, 2021
	Carrying amount		Fair value		Carrying amount		Fair value
	(EUR’000)
Marketable securities specified by security type
U.S. Treasury bills		79,086		79,043		—		—
U.S. Government bonds		99,337		98,075		95,408		95,211
Commercial papers		—		—		2,207		2,207
Corporate bonds		104,236		103,301		226,771		226,379
Agency bonds		15,521		15,424		18,972		18,934
Total marketable securities		298,180		295,843		343,358		342,731
Classified based on maturity profiles
Non-current assets		7,492		7,201		107,561		107,175
Current assets		290,688		288,642		235,797		235,556
Total marketable securities		298,180		295,843		343,358		342,731

Marketable securities have a weighted average duration of 3.0 and 12.6 months, for current (i.e., those maturing within twelve months after the reporting date) and non-current positions, respectively. The entire portfolio of marketable securities (current and non-current) has a weighted average duration of 3.2 months.

Contractual cashflows for non-derivative financial liabilities recognized in the consolidated statements of financial position are specified below.


	< 1 year		1-5 years		>5 years		Total contractual cash-flows		Carrying amount
	(EUR’000)
Financial liabilities
December 31, 2022
Borrowings
Lease liabilities		13,996		53,821		60,946		128,763		109,191
Convertible senior notes		12,130		48,519		545,161		605,810		399,186
Total borrowings		26,126		102,340		606,107		734,573		508,377
Trade payables and accrued expenses		101,032		—		—		101,032		101,032
Total financial liabilities		127,158		102,340		606,107		835,605		609,409

Financial liabilities
December 31, 2021
Borrowings
Lease liabilities		7,098		51,442		68,378		126,918		104,961
Total borrowings		7,098		51,442		68,378		126,918		104,961
Trade payables and accrued expenses		59,417		—		—		59,417		59,417
Total financial liabilities		66,515		51,442		68,378		186,335		164,378