The Company manages capital to ensure that all group enterprises will be able to continue as a going concern while maximizing the return to shareholders through the optimization of debt and equity balances.

The Company’s capital structure consists of equity and external debt obtained through issuance of convertible notes and royalty funding liabilities. The Company is not subject to any contractually imposed capital requirements or financial 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 57,707,439 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:


	2023		2022		2021		2020		2019
	(Number)
Changes in share capital
At January 1		57,152,295		56,937,682		53,750,386		47,985,837		42,135,448
Increase through cash contributions		555,144		214,613		3,187,296		5,764,549		5,850,389
At December 31		57,707,439		57,152,295		56,937,682		53,750,386		47,985,837

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, 2022		21			154,837			—
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	%
Transferred under stock incentive programs		(3	)		(20,098	)		—
At December 31, 2023		146			1,093,054			1.9	%

The Company regularly monitors the access to domestic and international financial markets, manages the financial risks relating to its operations, and analyzes 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 and royalty funding liabilities. 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/(loss) before tax			Equity before tax
	(EUR ‘000)
USD/EUR
December 31, 2023		(369,091	)		10	%		(36,909	)		(36,909	)
December 31, 2022		60,581			10	%		6,058			6,058

Outstanding convertible notes comprise a 2.25% coupon fixed rate structure. Further, interest rate on lease liabilities is fixed at the lease commencement date. In addition, the effective interest rate on royalty funding liabilities is estimated at initial recognition and takes into account anticipated amount and timing of future cash flows, which further depends on future commercial revenue forecasts and the probability of exercising the embedded buy-out option. Material changes to anticipated future cash flows could potentially increase or decrease future interest expense.

Future indebtedness 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:


	2023				2022
	Carrying amount		Fair value		Carrying amount		Fair value
	(EUR’000)
Marketable securities specified by rate structure
Fixed rate		7,275		7,266		205,825		203,543
Floating rate		—		—		11,787		11,773
Zero-coupon		—		—		80,568		80,527
Total marketable securities		7,275		7,266		298,180		295,843

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:


	2023				2022
	Carrying amount		Fair value		Carrying amount		Fair value
	(EUR’000)
Marketable securities specified by investment grade credit rating
High grade		4,523		4,519		203,530		202,048
Upper medium grade		2,752		2,747		94,650		93,795
Total marketable securities		7,275		7,266		298,180		295,843

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, through issuance of convertible notes in 2022, and through royalty funding liabilities in 2023.

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.


	2023				2022
	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		4,523		4,519		99,337		98,075
Corporate bonds		2,752		2,747		104,236		103,301
Agency bonds		—		—		15,521		15,424
Total marketable securities		7,275		7,266		298,180		295,843
Classified based on maturity profiles
Non-current assets		—		—		7,492		7,201
Current assets		7,275		7,266		290,688		288,642
Total marketable securities		7,275		7,266		298,180		295,843

At December 31, 2023 marketable securities have a weighted average duration of 1.0 month after the reporting date.

Contractual cash flows 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, 2023
Borrowings		11,708		742,925		42,397		797,030		545,472
Lease liabilities		14,385		51,426		49,056		114,867		98,793
Trade payables and accrued expenses		94,566		—		—		94,566		94,566
Total financial liabilities		120,659		794,351		91,453		1,006,463		738,831

Financial liabilities
December 31, 2022
Borrowings		12,130		48,519		545,161		605,810		399,186
Lease liabilities		13,996		53,821		60,946		128,763		109,191
Trade payables and accrued expenses		101,032		—		—		101,032		101,032
Total financial liabilities		127,158		102,340		606,107		835,605		609,409