19.Equity

The individual components of equity and changes in equity in fiscal years 2020 and 2021 are presented in the Covestro Group consolidated statement of changes in equity.

Capital stock

The capital stock of Covestro AG changed as follows in fiscal 2021:

Covestro AG’s capital stock as of December 31, 2021, is divided into 193,200,000 (previous year: 193,200,000) no-par value bearer shares and is fully paid up. Each share confers the right to one vote.

Treasury Shares

Covestro AG issued 39,456 (previous year: 95,859) treasury shares to employees of the German legal entities under the Covestment share-based participation program. As of December 31, 2021, the company held no treasury shares (previous year: 39,456, corresponding to 0.02% of the capital stock).

Authorized and Conditional Capital

The annual general meeting (AGM) passed a resolution on April 16, 2021, authorizing the Board of Management to increase the capital stock by up to €57,960,000 in the period up to April 15, 2026, with the approval of the Supervisory Board, by issuing new, no-par value bearer shares against cash contributions and/or contributions in kind (Authorized Capital 2021).

The Authorized Capital 2021 has not been utilized to date.

On July 30, 2020, the AGM authorized the Board of Management to issue bonds with conversion or exchange rights or warrants, or with conversion obligations, or a combination of these instruments on up to 18,300,000 no-par value bearer shares of Covestro AG. Based on this authorization, convertible/warrant bonds can be issued up to a total nominal value of €2 billion by the company or a Group company in the period up to July 29, 2025. The AGM in the year 2020 also resolved to conditionally increase the capital stock by up to €18.3 million by issuing up to 18,300,000 no-par value bearer shares to grant shares to the holders or creditors of such convertible/warrant bonds (Conditional Capital 2020).

The Conditional Capital 2020 has not been utilized to date.

Capital Reserves

Covestro AG’s capital reserves as of December 31, 2021, amounted to €3,927 million (previous year: €3,925 million). The increase is attributable to the issuance of treasury shares under the Covestment program (€2 million).

Dividend

The dividend available for distribution is based on the distributable profit reported in the annual financial statements of Covestro AG, which were prepared according to the provisions of the German Commercial Code (HGB). The dividend proposed for fiscal 2021 amounts to €3.40 per share carrying dividend rights for a total distribution of €657 million based on the number of shares carrying dividend rights as of December 31, 2021, and depends on authorization by the shareholders at the Annual General Meeting. It is therefore not recognized as a liability in the consolidated financial statements. For fiscal 2020, a dividend of €1.30 per share carrying dividend rights was paid in April 2021.

Equity Attributable to Noncontrolling Interest

The equity attributable to noncontrolling interest mainly relates to the equity of Sumika Covestro Urethane Company, Ltd., Hyogo (Japan); Covestro Eternal Resins (Kunshan) Co., Ltd., Kunshan (China); Japan Fine Coatings Co., Ltd., Ibaraki (Japan); Covestro Eternal Resins (Far East) Ltd. Pingtung (Taiwan, Greater China); DIC Covestro Polymer Ltd., Tokyo (Japan); and Covestro (Taiwan) Ltd., Kaohsiung City (Taiwan, Greater China).

The changes in equity attributable to noncontrolling interest are presented in the following table:

Accumulated Other Comprehensive Income

Accumulated other comprehensive income was as follows: