Årsrapport 32285201 Martinsen, Statsautoriseret Revisionspartnerselskab Edison Park, 4 6715, Esbjerg N 2023-01-01 2023-12-31 2024-01-01 2024-12-31 36477865 EXOWAVE ApS Kanalen 1 6700 Esbjerg 2014-12-30 Esbjerg Martinsen, Statsautoriseret Revisionspartnerselskab 32285201 Alexander Hardy Josef Müller Rasmussen statsautoriseret revisor mne24721 Edison Park 4 6715 Esbjerg N Danmark 76 11 44 00 2025-06-27 Peter Helbo Langsted Regnskabsklasse B Revisionspåtegning CaseWare fra Revisorgruppen Danmark kapitalejerne Esbjerg 2025-06-27 Esbjerg 2025-06-27 Grundlag for konklusion Konklusion 201336 876531 2462522 2639550 -2261186 -1763019 -384105 -216403 311 0 0 103 -2644980 -1979525 -1636362 0 -1008618 -1979525 -1008618 -1979525 33999 33999 33999 33999 33999 33999 3515500 1591738 44307 29957 3559807 1621695 324268 114297 3884075 1735992 3918074 1769991 0 79385 78284 722515 -365268 801900 -286984 6500 6500 6500 6500 1204875 832375 1204875 832375 1809338 1036453 95461 181647 1904799 1218100 3109674 2050475 3918074 1769991 2436653 2612478 10692 11171 15177 15901 2462522 2639550 3 3 0 103 0 103 40001 40001 40001 40001 -40001 -40001 -384105 -216403 381000 215000 -43106 -41404 3105 1403 3105 1403 Patentselskabet af 30. november 2014 ApS ApS Esbjerg 100 33999 33999 33999 78284 77965 1101 319 79385 78284 -365268 1004793 -1008618 -1979525 2096401 609464 722515 -365268 Today, the Board of Directors and the Managing Director have approved the annual report of EXOWAVE ApS for the financial year 2024. The annual report has been prepared in accordance with the Danish Financial Statements Act. We consider the chosen accounting policy to be appropriate, and in our opinion, the financial statements give a true and fair view of the financial position of the Company at 31 December 2024 and of the results of the Company's operations for the financial year 1 January – 31 December 2024. Further, in our opinion, the Management's review gives a true and fair review of the matters discussed in the Management's review. We recommend that the annual report be approved at the Annual General Meeting. Lars Wigant Gabriele Rampinelli Lars Wigant Michael Smedegaard Hannes Reuter We have audited the financial statements of EXOWAVE ApS for the financial year 1 January - 31 December 2024, which comprise a summary of significant accounting policies, income statement, balance sheet and notes, for the Company. The financial statements are prepared under the Danish Financial Statements Act. In our opinion, the financial statements give a true and fair view of the financial position of the Company at 31 December 2024, and of the results of the Company's operations for the financial year 1 January - 31 December 2024 in accordance with the Danish Financial Statements Act. Basis for conclusion We conducted our audit in accordance with International Standards on Auditing (ISAs) and the additional requirements applicable in Denmark. Our responsibilities under those standards and requirements are further described in the “Auditor’s Responsibilities for the Audit of the Financial Statements” section of our report. We are independent of the Company in accordance with the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (IESBA Code) and the additional ethical requirements applicable in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the Danish Financial Statements Act, and for such internal control as Management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, Management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting in preparing the financial statements unless Management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management. Conclude on the appropriateness of Management’s use of the going concern basis of accounting in preparing the financial statements and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern. Evaluate the overall presentation, structure and contents of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that gives a true and fair view. Plan and perform the audit of the financial statements to obtain sufficient appropriate audit evidence regarding consolidated financial information of the entities or business units as a basis for forming an opinion on the financial statements. We are responsible for the direction, supervision and review of the audit work performed. We remain solely responsible for our audit opinion. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Statement on Management’s Review Management is responsible for Management’s Review. Our opinion on the financial statements does not cover Management’s Review, and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read Management’s Review and, in doing so, consider whether Management’s Review is materially inconsistent with the financial statements or our knowledge obtained during the audit, or otherwise appears to be materially misstated. Moreover, it is our responsibility to consider whether Management’s Review provides the information required under the Danish Financial Statements Act. Based on the work we have performed, we conclude that Management’s Review is in accordance with the financial statements and has been prepared in accordance with the requirements of the Danish Financial Statement Act. We did not identify any material misstatement of Management’s Review. Principal Activities Exowave ApS develops technologies to convert ocean wave energy into renewable electricity and fresh water. The company strategically deploys invested capital and public funding to advance its mission: enabling global access to clean energy and fresh water by harnessing the power of the ocean. Core focus areas include: R&D and engineering of wave energy systems Commercial development, production and technology licensing Provision of energy and water-related services The company aims to develop a 250 MW wave energy facility in the Danish North Sea by 2030, starting with pilot demonstrators in the North Sea, projects in island and remote communities and scaling up to large-scale utility deployments. Significant changes in the company's activities and financial matters Financial result: The result for 2024 was DKK -1.008.618 compared to a loss of DKK -1.979.525 in 2023. This aligns with expectations due to the company's focus on development and market establishment activities. Development costs were recognized in the income statement in the year incurred. Revenue from project grants and associated costs are recognized directly in accordance with the company’s accounting practices. At year-end 2024, Exowave’s financial position is considered sufficient to support operations, project activities, and strategic initiatives in 2025. Technical Development Significant progress was made in advancing Exowave’s core technology platform: EUDP2 – North Sea 250 MW Wave Power Project: Project launched in January 2023, with a total budget of DKK 23.8 million (grant: DKK 14.2 million) Completion of system design and engineering activities Procurement of long lead items Onshore system successfully executed in H1 2025 with independent certifying body approval Offshore deployment planned for H2 2025 New Patent Filings: A new international PCT patent application was filed in January 2024: “Wave Power Converter with Yaw Control and Safety Release” (PCT/DK2024/050008, WO 2024/156319 A1). This builds on Exowave’s granted patents in over a dozen jurisdictions including the U.S., Europe, China, Japan, India, Brazil, and others, reinforcing the technical and commercial strength of its innovation portfolio. Business Development 2024 marked a year of significant strategic expansion: AquaX Joint Venture (U.S.): Finalized in early 2025 with operating agreement signed January 2025 Focused on Exowave technology commercialization and service provision across North, Central, and South America APAC Market Expansion: Memorandum of Understanding signed with a regional partner in January 2025 Planning underway for a joint venture to enter Asia-Pacific markets Port of Hanstholm Lease: Continued development of the leased area through 2024 in preparation for offshore demonstrations in 2025 Expected developments The company is looking ahead to 2025 with following expected developments: Completion of EUDP2 demonstration project Launch of AquaX JV commercial operations and first demonstrator deliveries Formalization of the APAC JV structure Ongoing patent filings and R&D iterations Events occurring after the end of the financial year There have been following events after the balance sheet date, which had influenced the company's financial position by the year ending 2024: AquaX JV: Operating agreement signed in January 2025 APAC JV: MoU signed with local partner in January 2025 Tax Credit Reimbursement: Danish Tax Agency approved DKK 1.63 million DKK reimbursement for the fiscal years 2021–2023 under §8X of the Danish Tax Code is booked in the balance by the end of 2024. The annual report for EXOWAVE ApS has been presented in accordance with the Danish Financial Statements Act regulations concerning reporting class B enterprises. Furthermore, the company has decided to comply with certain rules applying to reporting class C enterprises. The accounting policies are unchanged from last year, and the annual report is presented in DKK. Gross profit Gross profit comprises the revenue, changes in inventories of finished goods, and work in progress, own work capitalised, other operating income, and external costs. The enterprise will be applying IAS 11 and IAS 18 as its basis of interpretation for the recognition of revenue. Revenue is recognised in the income statement if delivery and passing of risk to the buyer have taken place before the end of the year and if the income can be determined reliably and inflow is anticipated. Revenue is measured at the fair value of the consideration promised exclusive of VAT and taxes and less any discounts relating directly to sales. Cost of sales comprises costs concerning purchase of raw materials and consumables less discounts. Other external costs comprise costs for distribution, sales, advertisement, administration and premises. Staff costs Staff costs include salaries and wages, including holiday allowances, pensions, and other social security costs, etc., for staff members. Research and development costs Research and development costs comprise costs, salaries, and wages and depreciation directly or indirectly attributable to the company’s research and development activities. Research costs are recognised in the income statement in the year incurred. Financial income and expenses Financial income and expenses are recognised in the income statement with the amounts concerning the financial year. Financial income and expenses comprise interest income and expenses. Results from investments in subsidiaries After full elimination of intercompany profit or loss less amortised consolidated goodwill, the investment in the individual entities are recognised in the income statement as a proportional share of the entities' post-tax profit or loss. Tax on net profit or loss for the year Tax for the year comprises the current income tax for the year and changes in deferred tax and is recognised in the income statement with the share attributable to the net profit or loss for the year and directly in equity with the share attributable to entries directly in equity. The company is subject to Danish rules on compulsory joint taxation of Danish group enterprises. The company acts as an administration company in relation to the joint taxation. This means that the total Danish tax payable by the Danish consolidated companies is paid to the tax authorities by the company. The current Danish income tax is allocated among the jointly taxed companies proportional to their respective taxable income (full allocation with reimbursement of tax losses). Impairment loss relating to non-current assets The carrying amount of both intangible and tangible fixed assets as well as equity investments in subsidiaries are subject to annual impairment tests in order to disclose any indications of impairment beyond those expressed by amortisation and depreciation respectively. If indications of impairment are disclosed, impairment tests are carried out for each individual asset or group of assets, respectively. Writedown for impairment is done to the recoverable amount if this value is lower than the carrying amount. The recoverable amount is the higher value of value in use and selling price less expected selling cost. The value in use is calculated as the present value of the expected net cash flows from the use of the asset or the asset group and expected net cash flows from the sale of the asset or the asset group after the end of their useful life. Previously recognised impairment losses are reversed when conditions for impairment no longer exist. Impairment relating to goodwill is not reversed. Investments in subsidiaries Investments in subsidiaries are recognised and measured by applying the equity method. The equity method is used as a method of consolidation. Investments in subsidiaries are recognised in the statement of financial position at the proportionate share of the enterprise's equity value. This value is calculated in accordance with the parent's accounting policies with deductions or additions of unrealised intercompany gains and losses as well as with additions or deductions of the remaining value of positive or negative goodwill calculated in accordance with the acquisition method. Negative goodwill is recognised in the income statement at the time of acquisition of the equity investment. If the negative goodwill relates to contingent liabilities acquired, negative goodwill is not recognised until the contingent liabilities have been settled or lapsed. Investments in subsidiaries with a negative equity value are measured at DKK 0, and any accounts receivable from these enterprises are written down to the extent that the account receivable is uncollectible. To the extent that the parent has a legal or constructive obligation to cover an negative balance that exceeds the account receivable, the remaining amount is recognised under provisions. To the extent the equity exceeds the cost, the net revaluation of equity investments in subsidiaries transferred to the reserve under equity for net revaluation according to the equity method. Dividends from subsidiaries expected to be adopted before the approval of this annual report are not subject to a limitation of the revaluation reserve. The reserve is adjusted by other equity movements in subsidiaries. Deposits Deposits are measured at amortised cost and represent lease deposits, etc. Receivables Receivables are measured at amortised cost, which usually corresponds to nominal value. Accounts receivable for which there is no objective indication of impairment at the individual level are evaluated at portfolio level for objective indication of impairment. The portfolios are primarily based on the debtors' domicile and credit rating in accordance with the company's and the group's credit risk management policy. Determination of the objective indicators applied for portfolios are based on experience with historical losses. Impairment losses are calculated as the difference between the carrying amount of accounts receivable and the present value of the expected cash flows, including the realisable value of any securities received. The effective interest rate for the individual account receivable or portfolio is used as the discount rate. Prepayments Prepayments recognised under assets comprise incurred costs concerning the following financial year. Cash and cash equivalents Cash and cash equivalents comprise cash at bank and on hand. Provisions Provisions comprise expected costs of warranty commitments, loss on work in progress, restructuring, etc. Provisions are recognised when the company has a legal or actual commitment resulting from a previously occurred event and when it is probable that the settlement of the liability will result in consumption of the financial resources of the company. Provisions are measured at net realisable value or at fair value. If the fulfilment of a liability is expected to take place far in the future, the liability is measured at fair value. On the acquisition of entities, provisions for restructuring within the acquired entity are included in the acquisition cost, and thereby in the goodwill or the consolidated goodwill, to the extent that they have been recognised in the financial statements of the acquired entity in advance of the acquisition. Provisions for restructuring are included to the extent that they have been decided at the date of acquisition at the latest and that the process have been commenced. When it is likely that the total costs will exceed the total income of contract work in progress, the total expected loss on the contract work in progress will be recognised as provisions for liabilities. The provision is recognised under production costs. Liabilities other than provisions Other liabilities concerning payables to suppliers, group enterprises, and other payables are measured at amortised cost which usually corresponds to the nominal value. 1. Special items Special items include significant income and expenses of a special nature relative to the enterprise's ordinary operating activities, such as the cost of extensive structuring of processes and fundamental structural adjustments and any related gains on disposal and losses which, over time, have a significant impact. Special items also include other significant amounts of a nonrecurring nature. Special items for the year relate to tax refund from the Danish Tax Agency for earlier years development costs. The tax refund for earlier years is included in the income statement under the item 'Tax on net profit or loss for the year' of total 1.636 t.DKK as an income. 10. Charges and security None. 11. Contingencies Contingent liabilities The company has entered into an office lease with an annual lease payment of 160 t.DKK. The notice period is 6 months. The company has issued a letter of support for the subsidiary company. Joint taxation The company acts as administration company for the group of companies subject to the Danish scheme of joint taxation and is unlimitedly, jointly, and severally liable, along with the other jointly taxed companies, to pay the total corporation tax. The company is unlimitedly, jointly, and severally liable, along with the other jointly taxed companies, for any obligations to withhold tax on interest, royalties, and dividends. 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