13723540 2022-01-01 2022-12-31 13723540 2022-01-01 2022-12-31 cmn:PreviousYearMember 13723540 2021-01-01 2021-12-31 13723540 2022-12-31 13723540 2021-12-31 13723540 2022-01-01 2022-12-31 0 13723540 2021-01-01 2021-12-31 1 13723540 2022-01-01 2022-12-31 0 13723540 2021-01-01 2021-12-31 1 13723540 2022-01-01 2022-12-31 2 13723540 2021-01-01 2021-12-31 3 13723540 2022-01-01 13723540 2021-01-01 13723540 2022-01-01 2022-12-31 0 13723540 2022-01-01 2022-12-31 1 13723540 2022-01-01 2022-12-31 2 13723540 2022-01-01 2022-12-31 3 13723540 2022-01-01 2022-12-31 0 13723540 2022-01-01 2022-12-31 1 13723540 2022-01-01 2022-12-31 2 13723540 2022-01-01 2022-12-31 3 13723540 2022-01-01 2022-12-31 4 13723540 2022-01-01 2022-12-31 5 13723540 2022-01-01 2022-12-31 6 13723540 2022-01-01 2022-12-31 7 13723540 2022-01-01 2022-12-31 8 13723540 2022-01-01 2022-12-31 0 13723540 2022-01-01 2022-12-31 1 iso4217:EUR xbrli:pure Regnskabsklasse C, stor virksomhed Faerch A/S Rasmus Færchs Vej 1 7500 Holstebro Denmark +45 99 10 10 10 dk@faerch.com 13723540 2022-01-01 2022-12-31 2023-03-27 Henrik Poulsen <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">SUSTAINABILITY</td></tr><tr><td colspan="1">Laying the path for circularity</td></tr><tr><td colspan="1">At Faerch, we focus on obtaining sustainable value creation. We identify the Sustainable Development Goals as our roadmap to align our company goals to serve the long-term goals of society. We do this by balancing short-term and long-term business priorities.</td></tr><tr><td colspan="1">Our environmental, social and governance (ESG) performance is closely connected to our financial performance which is reflected in our four P’s framework: Planet, People, Principles of Governance and Prosperity.</td></tr><tr><td colspan="1">We will work consistently to integrate these four P’s in every aspect of our business and to improve in every dimension to push the bar for sustainable value creation even higher.</td></tr><tr><td colspan="1">Focussing on what matters most Assessing materiality helps us identify and prioritise the sustainability issues that matter the most to our business and our stakeholders, from customers, consumers, and communities, to owners, suppliers, and employees.</td></tr><tr><td colspan="1">In 2022, we made a double materiality assessment on sustainability related topics. We assessed the most material impacts to Faerch – both where we impact the planet and society the most and where our business is mostly impacted by the world around us. The material risks and opportunities within the areas of ESG have been identified based on universal and industry standards, and from interviews with various stakeholders, both internally and externally.</td></tr><tr><td colspan="1">We have assessed 15 ESG topics as the most material and through our four P’s framework, we have prioritized programmes to ensure that we continuously improve on these topics. Some programmes have already started, others are planned to start in 2023.</td></tr><tr><td colspan="1">With the four P’s framework, we are highlighting the need to look at sustainable value creation holistically, and work with multiple dimensions to ensure sustainability over time.</td></tr><tr><td colspan="1">Sustainability oversight</td></tr><tr><td colspan="1">Governance of sustainability is anchored with the Board of Directors and the Executive Management Team. Ownership and responsibility to drive actions across the various categories are anchored in the business to ensure alignment with priorities and a long-term focus on sustainability. In 2023, we will assign a sponsor from the Executive Management Team to each category, identified as our sustainability priorities from our double materiality assessment.</td></tr><tr><td colspan="1">Across categories, a central SteerCo representing key corporate functions ensures direction, coordination, and subject matter expertise.</td></tr><tr><td colspan="1">Underlining the commitment to the integrated sustainability strategy, the Board of Directors has committed to linking executive remuneration to key ESG targets from 2024.</td></tr><tr><td colspan="1">As external expectations on sustainability issues continuously develop, and as our efforts progress, we recognise that our priorities will evolve, and our target-setting and reporting will mature.</td></tr><tr><td colspan="1">ENVIRONMENTAL</td></tr><tr><td colspan="1">Race to Zero</td></tr><tr><td colspan="1">SPEEDING UP CLIMATE ACTION</td></tr><tr><td colspan="1">We all have an obligation to contribute to speed up climate action and being a fast-growing global company, the contribution of our decarbonisation actions will only be even more impactful. Faerch is committed to being a frontrunner, within the food packaging industry, to reach net zero emissions as fast as possible.</td></tr><tr><td colspan="1">Our commitments</td></tr><tr><td colspan="1">In 2022, we have committed to the Science Based Targets initiative (SBTi) to align with the most ambitious aim of the Paris Agreement – to reach net zero global emissions by 2050 at the latest.</td></tr><tr><td colspan="1">However, we want to increase the ambition by aiming for net zero across our entire value chain by 2040 at the latest and reducing our emissions 50% by 2030 compared to our base year (2022).</td></tr><tr><td colspan="1">During 2023, we will submit our near-term (2030) and long-term (2040) targets and have them validated by the SBTi.</td></tr><tr><td colspan="1">Our road to net zero</td></tr><tr><td colspan="1">For us to reach our net zero commitment, a full transition into circular low carbon input materials are required. This is a path we have been on for some time already with recycled tray PET from our recycling plant Cirrec, and it is fully aligned with our current business model as an integrated recycler and the foundation of our strategy going ahead in terms of growth and scaling.</td></tr><tr><td colspan="1">Our focus areas and must-win battles are energy efficiency, renewable energy (Power Purchase Agreements and on-site solar panels), recycled input material and supplier engagement. Some initiatives have already commenced, but we expect 2023 to be the year where we accelerate our initiatives on this area, and set concrete interim goals to reach our near-term target of a 50% reduction by 2030.</td></tr><tr><td colspan="1">Energy efficiency in the Group platform</td></tr><tr><td colspan="1">To Faerch, the best energy is the energy saved both in terms of emission reductions and costs. We will therefore continue our work to use energy-efficient technologies, and work continuously to reduce our energy consumption with our “Power of Faerch” programme focusing on energy efficiencies. In 2023, we will run a pilot project at a selected site in collaboration with external experts who will examine the portfolio of available solutions to make the site more energy efficient. These solutions will subsequently be rolled out in the Group where suitable and aligned with our Group Platform mindset. This will allow us to set clear guidelines on how Faerch sites should operate to become more energy and cost-efficient.</td></tr><tr><td colspan="1">Scaling our recycling and engaging with suppliers</td></tr><tr><td colspan="1">Over 60% of our carbon emissions are tied to our purchased goods. In line with our business strategy we will scale our recycling business and ensure that we are able to provide low carbon and circular input material into our food packaging business.</td></tr><tr><td colspan="1">In addition we will work with our suppliers to reach our goals and ambitions. This will be done through a comprehensive Supplier Engagement</td></tr><tr><td colspan="1">GHG emissions across our value chain Programme. We will assess our suppliers and split them into two groups; high emitters and low emitters. Firstly, we will engage with the high emitters, being mostly our resin suppliers, due to their large quantities provided; ensuring they support our targets and are encouraged to set their own Science Based Targets with the SBTi. We will then continue to the low emitters.</td></tr><tr><td colspan="1">Carbon footprint on products</td></tr><tr><td colspan="1">In 2023, we will make a strong effort to ensure further transparency to respond to the increasing customer requests concerning our products’ carbon footprint and other environmental impacts. We are convinced that by helping our customers decarbonise and achieving their environmental targets, we will move closer to achieving our circularity ambitions.</td></tr><tr><td colspan="1">We want to unlock low carbon and circular solutions for our customers. Mono-PET is currently the sustainable material of choice being fully circular and naturally lower in carbon emission compared to virgin material.</td></tr><tr><td colspan="1">Furthermore, we expect the emissions for recycled PET (rPET) to approach zero in the coming years through greener waste collection, sorting processes and production of recycled material.</td></tr><tr><td colspan="1">In 2023, we will perform an externally audited Life Cycle Assessment (LCA) of the recycled tray PET material being produced at our recycling plant, Cirrec. The assessment will enable us to demonstrate the environmental benefits of the material to stakeholders and to provide a baseline for systematically making the rPET material even more sustainable over time, as there is always room for improvements until reaching zero environmental impact.</td></tr><tr><td colspan="1">In 2022 we signed a PPA with Heartland, to supply renewable energy to our site in Holstebro, Denmark. The Heartland solar park is located only 8 km from the Holstebro site and consists of 500.000 solarpanels producing more than 205 GWh.</td></tr><tr><td colspan="1">Higher standard for renewable energy</td></tr><tr><td colspan="1">Faerch Group’s energy consumption is spread across 32 locations in 15 countries, and our annual consumption is currently reaching over 560 GWh.</td></tr><tr><td colspan="1">Previously, Faerch Group had bought guarantees of origin (green certificates) to secure the use of 100 % renewable energy. However, with the recent developments in the market it has become clear that guarantees of origin are not an effective tool for ensuring 100% renewable energy. Therefore, we have initiated a more ambitious plan focusing on contributing with additionality to the electricity grid. This will be through Power Purchasing Agreements (PPAs) and on-site solar panels, as we believe it is a more legitimate wayto help accelerate the transition to a society powered 100% by renewable energy.</td></tr><tr><td colspan="1">“As part of our commitment to secure 100% renewable energy, we are launching a new renewable energy procurement strategy focusing on long-term Power Purchase Agreements (PPAs) and on-site solar panels. Moving our focus is a major step towards achieving our goal to ensure 100% renewable energy consumption through additionality, where possible, by 2030. At the same time, we are actively helping to increase the amount of renewable energy in society and thereby reducing emissions”, says Thomas Peter</td></tr><tr><td colspan="1">Vikkelsø Tranders, Group Category Director, Sourcing and Procurement and continues</td></tr><tr><td colspan="1">“With PPAs, we are ensured a long-term and attractive price agreement which will help secure long-term input price certainty at Faerch. The same goes for renewable energy developers and their lenders, where PPAs can help make new renewable energy projects financially viable.”</td></tr><tr><td colspan="1">We expect to have entered into PPAs for all sites no later than the end of 2025 and for all PPAs to be fully implemented 1-2 years later for solar and 2-3 years for wind. This will bring Faerch in line with the overall 1.5°C ambition of the Paris Agreement for our scope 2 emissions. When fully implemented, the PPAs will cover 80-100% of our energy consumption with on-site solar panels covering the rest. Our goal is to ensure renewable energy consumption and to achieve the best possible terms and attractive prices for electricity in the long run, being a sustainable solution both in terms of climate and finances. We also commit to transparent reporting on our progress made and will work to align our CO2e-reporting with the 24/7 carbon-free energy principles.</td></tr><tr><td colspan="1">ENVIRONMENTAL</td></tr><tr><td colspan="1">Support our Planet</td></tr><tr><td colspan="1">CIRCULARITY IS KEY</td></tr><tr><td colspan="1">Waste should never end up in nature or oceans, not plastic, nor any other material. We aim to clean up waste streams by transforming tray waste into new trays, creating a circular loop – turning waste into value. We want to unlock the potential but recognise that much is still to be done in improving the eco- design of food packaging on the market, waste infrastructure and the culture around waste handling throughout in the world.</td></tr><tr><td colspan="1">Material choice and design are essential to fully close the loop in food packaging. To transition into a circular economy, we need to see positive changes in product design from producers, waste management infrastructure from governments and littering behavior from end-consumers.</td></tr><tr><td colspan="1">Eco-design is fundamental</td></tr><tr><td colspan="1">In order for us to lead the transition to a circular economy within rigid food packaging, the availability of post-consumer household waste is crucial. However, this is one of our greatest challenges, as demand is significantly increasing, and plastic packaging collection rates are generally stagnating. This makes it difficult to source sufficient household waste material of the right quality. However, we are seeing tailwinds from legislation with commitments to circularity, which is being rolled out in the coming years through taxes and Extended Producer Responsibility schemes This will incentivise the use of circular materials when designing packaging products.</td></tr><tr><td colspan="1">To encourage circularity and support the availability of tray waste, it is important that we interact directly with retailers and customers to create closed loops through take-back systems. An example is our Back at Store Programme with UK’s largest retailer, Tesco. The programme sees 2,000 tonnes of retail ready tray waste going into a circular loop each year.</td></tr><tr><td colspan="1">Being reliant on circular, mono-PET input material, we, as a producer have a responsibility and a great incentive to support the loop, with products that can feed into our own recycling plant. Our acquisitions in recent years underline our commitment to lead the transition to circularity in food packaging, as well as our continuous journey to convert into mono- material PET.</td></tr><tr><td colspan="1">With the acquisition of PACCOR in 2022, we went from having 15% Polypropylene (PP) material in our business to 43%. This increase in PP is challenging, but with it comes even bigger opportunities. It allows us to scale up conversions and make a significant impact on the rigid food packaging market, especially in Europe. With that said, we continue to keep a close eye on technological developments that could solve circularity issues related to other resin materials, especially PP, which could become technically and economically feasible for chemical recycling at a large industrial scale. Until then, we continue to support the conversion and increase of PET, being the only scalable circular solution available on the rigid food packaging market.</td></tr><tr><td colspan="1">Reducing waste streams</td></tr><tr><td colspan="1">Our recycling business enabled recycling of around 34,000 tonnes of household waste in 2022. The capacity is expected to grow in coming years in accordance with our business plan to scale up tray recycling.</td></tr><tr><td colspan="1">In 2023, our new tray wash line will be installed at our recycling plant Cirrec in the Netherlands. This will increase capacity to around 55,000 tonnes and more than triple our PET tray recycling capacity, as we discontinue our current bottle wash line to accelerate tray-to-tray recycling.</td></tr><tr><td colspan="1">Striving for less</td></tr><tr><td colspan="1">Not all materials processed in our recycling plant meet the quality standards required for Faerch’s products. Some are not even suitable as recycled content in our products. The input waste bales processed in our recycling plant reflect how well household waste is sorted. The current waste stream is challenged by mixed materials that cannot be separated in the recycling process, counteracting circularity.</td></tr><tr><td colspan="1">Upcoming EU regulation, will make the future waste streams cleaner as a result of improved sorting, higher demands for eco-design and a harmonisation in product development. This will reduce the output waste stream from our recycling business significantly.</td></tr><tr><td colspan="1">However, the regulation may be a long time coming. In the meantime, we will focus on partnerships to secure that everything that can be recycled, is recycled. For the non-recyclable materials called “waste-of-waste”, we will ensure that they are used as alternative fuels instead of being landfilled. This will substitute fossil fuels and function as a stepping stone to minimise fossil- fuel dependency.</td></tr><tr><td colspan="1">Environmental management</td></tr><tr><td colspan="1">We want our food packaging operations to be circular to zero, meaning zero production waste is landfilled or incinerated, zero pollution going into air, soil or water and zero waste of water by reducing water use and reusing water whenever possible at our production sites.</td></tr><tr><td colspan="1">Waste and water strategy</td></tr><tr><td colspan="1">In 2023, we will outline a waste and water strategy and identify waste and water reduction initiatives and establish more partnerships to make sure that our production waste is recycled.</td></tr><tr><td colspan="1">Operation Clean Sweep</td></tr><tr><td colspan="1">In 2019, Faerch joined Operation Clean Sweep, a dedicated program to help every plastic resin handling operation achieve zero plastic resin loss. With our recent acqusitions we will ensure that all of our sites commit to this and implement the initiative as soon as possible, making sure we take all necessary measures to prevent plastic pellets, powder and flakes loss to the environment.</td></tr><tr><td colspan="1">Replacing 330 tonnes of virgin plastic with recycled CPET</td></tr><tr><td colspan="1">Material conversion is necessary to achieve true circularity in food packaging. In 2022, in collaboration with Bunzl Catering Supplies, we successfully designed and delivered a new range of innovative CPET bowls into the UK restaurant chain Wagamama. Thanks to the initiative, more than 8 million delivery bowls are now replaced with circular and recyclable food packaging made of 70% recycled content on average.</td></tr><tr><td colspan="1">Output: The overall shift is expected to replace 330 tonnes of virgin plastic from Wagamama’s takeaway each year and to reduce carbon footprint of its most popular dish, the Katsu Curry, by 62%. Thereby, getting our customers on the right path towards reaching their net zero emission targets.</td></tr><tr><td colspan="1">David Lucas, Foodservice Sales Director for UK &amp; Ireland says: “Faerch are delighted to be part of this initiative to create a Foodservice industry first. By Wagamama choosing CPET as the base material for this new product launch, they have made the right decision using fact-based sustainability information and ensured the quality of their food will not be compromised”.</td></tr><tr><td colspan="1">Fully recyclable into new food grade products</td></tr><tr><td colspan="1">Made from up to 70% recycled content and fully recyclable into new food grade products of the same quality, mono-material CPET allows for true circularity. It is the material of choice for hot meals due to its superior functional properties and unique way of combining food safety and circularity. The Wagamama bowls are manufactured in a lighter creamy sand colour and are NIR detectable in UK recycling plants.</td></tr><tr><td colspan="1">Bowl Bank – a bowl-return initiative</td></tr><tr><td colspan="1">As a bonus to the initiative, Wagamama is introducing a bowl-return initiative called ‘Bowl Bank’, enabling its customers to bring back used packaging to its restaurants for recycling.</td></tr><tr><td colspan="1">The bowls are collected by Bunzl Catering Supplies drivers while they are making their usual deliveries, utilising existing space on the vehicle. On return to the Bunzl Catering Supplies branches, the waste bags are put into dedicated recycling bins and sent for recycling via its waste management partner. Going forward, Faerch plans to collect this material for recycling, enhancing the closed loop of tray-to-tray in Europe.</td></tr><tr><td colspan="1">Accelerating material conversion</td></tr><tr><td colspan="1">Evolve by Faerch trays are reliably detected by today’s sorting infrastructure and can, after use, be collected and recycled into new food packaging without any loss in quality.</td></tr><tr><td colspan="1">In 2022, the Evolve by Faerch concept continued to increase in sales volumes, and many food producers have moved closer to a closed loop, driving true circularity in food packaging forward. In 2022, Evolve by Faerch accounted for 48% of Faerch’s total CPET volume which is an increase of 8% compared to last year.</td></tr><tr><td colspan="1">In Germany, several food producers within the ready meals segment have converted from black CPET to the Evolve by Faerch concept in 2022, allowing them to offer fully recyclable food packaging solutions made from post-consumer recycled material.</td></tr><tr><td colspan="1">Keeping fresh meat products safe and protected</td></tr><tr><td colspan="1">In partnership with Faerch, Danish beef and veal producer, Himmerlandskød, has launched truly circular mono APET trays for fresh meat made with 84% recycled content. The trays boast superior barrier and sealing properties, extending shelf-life and reducing food waste. With superior uniformity, the trays are designed for a smooth production flow.</td></tr><tr><td colspan="1">SOCIAL</td></tr><tr><td colspan="1">Unlock the Potential</td></tr><tr><td colspan="1">A PEOPLE BUSINESS</td></tr><tr><td colspan="1">Our primary focus is on developing our organisation to meet the demands caused by the increased size and complexity of our Group. We will further align our structures and processes to ensure that knowledge and ways of working are well-documented.</td></tr><tr><td colspan="1">We will establish a new set of training formats within specific areas to better support the growth of the business. It is a way of developing and institutionalising the Faerch Way of Working. We call it the Faerch Way of Leading and the Faerch Way of Selling. Furthermore, we will develop and implement our own in-house Setter and Maintenance eduction programme focusing on training our employees at the factories.</td></tr><tr><td colspan="1">The People Factor</td></tr><tr><td colspan="1">During 2022, we have implemented the first step in our People Factor Platform within the Faerch Group. In 2023, we will begin implementing the Platform in selected PACCOR sites.</td></tr><tr><td colspan="1">We are a people business, and the People Factor Platform is one of our efforts to protect and develop our values and culture further across all our sites. The aim of the platform approach is to ensure fundamentals are in place to improve employee engagement and retention and increase attractiveness to new employees by operating with a best practice platform across all sites. Focus is on ensuring state-of-the-art factories, a safe working environment, proper on- boarding, equality, and that people enjoy working for us.</td></tr><tr><td colspan="1">In 2023, we will continue the roll out and follow-up on the People Factor Platform implementation across sites to ensure we always stay the local employer of choice. This is part of our values and culture and a natural part of driving our business forward.</td></tr><tr><td colspan="1">Ensuring the right people - feeding system</td></tr><tr><td colspan="1">In 2022, we needed to scale up the organisation and our processes to adapt to our increased size and complexity and the speed needed. This is a focus that will continue into 2023. Developing the organisation therefore represents one of the most important enablers of our strategy.</td></tr><tr><td colspan="1">We have established systematic talent development and an internal feeding system for succession planning, where we systematically identify and prepare potential successors and back-up candidates for all critical roles. We also have a clear development strategy of high potentials.</td></tr><tr><td colspan="1">Our process has shown that the feeding system works as our internal recruitment percentage over the past three years has been at a high level around 40% prior to this year’s acquisitions. In 2023, we will recruit a dedicated resource to drive this further as well as integrate the system into our acquired companies to ensure fast integration into our feeding system across the entire Group.</td></tr><tr><td colspan="1">Graduate Programme</td></tr><tr><td colspan="1">In 2022, we established our Future Faerch Generation programme. The programme focuses on developing a graduate programme, recruiting graduates within business relevant areas such as our technical area. The aim is to complement our already existing flow of new talent into our organisation through our trainee and apprentice education programmes.</td></tr><tr><td colspan="1">At Faerch, we are happy to cooperate with students when it comes to case studies and internships. It is a great way to make our presence known and to give students an insight into an international business environment. It also allows Faerch to meet potential future employees and ensure a flow of new talents into the organisation.</td></tr><tr><td colspan="1">Taking on new areas of specialisation</td></tr><tr><td colspan="1">Olga Gammelgaard has been at Faerch since October 2020 where she started in our production as a Thermoform Operator. In August 2022, she was promoted to Planning and Purchasing Assistant. Olga is originally from Ukraine and has been in Denmark since 2014. Like Olga, many of our employees take their career into a new area of specialisation, pursuing greater responsibility and utilising their unique skills and educational background.</td></tr><tr><td colspan="1">From apprentice to working abroad</td></tr><tr><td colspan="1">Benjamin Bernt Jensen has been at Faerch since September 2019 where he started in a position as Sales Apprentice. During his apprenticeship, Benjamin built a strong knowledge about our customers and products. After having completed his apprenticeship, he was offered a position as Sales and Project Coordinator. Shortly after entering his new role, he was given the possibility to travel to the Netherlands for half a year taking on an important role in building a new, local Customer Service Centre. This gave him the opportunity to expand his professional skills, take on greater responsibilities and experience cross-cultural co-operation.</td></tr><tr><td colspan="1">From student to starting a career</td></tr><tr><td colspan="1">Dawid Kucaj is a great example of a graduate who did a case project for Faerch during his studies. Dawid was consequently offered a position as Student worker in our Group Controlling department. From 2023 Dawid will take on a full-time role as Business Analyst in Group Strategy.</td></tr><tr><td colspan="1">Diversity, equity, and inclusion</td></tr><tr><td colspan="1">We want to see a society where everyone is treated equally, and we are determined to achieve a culture where everyone can develop and thrive. In 2023, we will drive development towards a more diverse and inclusive organisation which is crucial to retain and attract the best people.</td></tr><tr><td colspan="1">We are an international growth organisation, and we want to maintain our reputation as a workplace committed to ensuring fair and equal treatment and opportunities for all employees, regardless of age, gender identity, nationality etc. A company where differences are respected and valued.</td></tr><tr><td colspan="1">Inclusion will be the main driver for diversity going forward. Our policy for gender balance in management aims to increase the number of women at management level and to improve the representation of women in management at Faerch in general.</td></tr><tr><td colspan="1">With a clear objective to enhance diversity in our workforce, we promote and encourage equal opportunities ensuring that all aspects of our personnel practices promote equal career opportunities, including hiring procedures and conditions, internal promotion procedures and parental leave conditions.</td></tr><tr><td colspan="1">In 2023 we will be launching a Diversity, Equity, and Inclusion Programme (DEI) to promote and improve these prioritised topics within our workplace.</td></tr></table><br><table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">Attract the potential and become a more inclusive workplace</td></tr><tr><td colspan="1">“Leading the transition of food packing into a truly circular economy and following our strategy of combining innovation and cost leadership has always been demanding. In a much larger Group with a global footprint and operating in changing societies, it has become even more demanding.</td></tr><tr><td colspan="1">To succeed, we need to attract and retain the best people. We cannot afford to leave potentials untapped. Embracing differences, we consistently need to ensure equal opportunities and make our Group more inclusive.</td></tr><tr><td colspan="1">We will put additional focus on systematically establishing a more inclusive workplace – simply because it will make us better and more successful. Regardless of e.g., cultural background, origin, gender, mother tongue, age or nationality, everyone at Faerch needs to feel valued and respected, feel a strong sense of belonging, and all colleagues need be able to be themselves.</td></tr><tr><td colspan="1">We respect the experience of long-serving colleagues, while appreciating the drive and new ways of working younger team members contribute with.</td></tr><tr><td colspan="1">When we see groups underrepresented in specific areas, we spend time to understand the reason for it, systematically remove obstacles, and support them to quickly catch up.</td></tr><tr><td colspan="1">We will always look for the right qualifications, skills and quality of personality because we want more colleagues who can help us promote our Faerch values of being reliable, act with integrity, foster collaboration and always focus on results. We are decent, responsible, and we care. Becoming more inclusive reinforces these fundamental values.</td></tr><tr><td colspan="1">We as an organisation certainly have a way to go. I personally have a journey ahead of me, and I assume everyone has some blind spots. We need to spend time on this, asking ourselves where perspectives are underrepresented and how we drive change towards more inclusion and diversity without compromising on qualification and performance.</td></tr><tr><td colspan="1">We need raise awareness for this important subject and act accordingly. If we are not consciously inclusive, we are unconsciously exclusive.</td></tr><tr><td colspan="1">I expect the top management, all our leaders and colleagues to follow me in supporting the DEI programme which we will be launching during 2023.”</td></tr><tr><td colspan="1">SOCIAL</td></tr><tr><td colspan="1">Protect the People</td></tr><tr><td colspan="1">SAFETY FOR EVERYONE</td></tr><tr><td colspan="1">We are committed to grow our business responsibly and the health, safety and well- being of our employees, temporary workers, contractors, and visitors is one of our most important priorities. Providing a safe work environment that supports personal growth and optimises well-being, is part of our culture and is deeply embedded in our values and purpose to make a difference in the food packaging industry.</td></tr><tr><td colspan="1">Safety culture</td></tr><tr><td colspan="1">We want promote a culture of safe behaviour that reaches beyond compliance. We work systematically to prevent work-related injuries and monitor our health and safety performance through systematic safety reporting and third- party management certification. In addition to complying with applicable legal requirements and regulations, we comply with prevailing industry standards and the internationally recognised framework for occupational health and safety management ISO 45001. Some of our sites are ISO 45001 certified. The remaining have started to prepare for the certification.</td></tr><tr><td colspan="1">To promote a strong safety culture across our organisation, we have outlined both individual and shared responsibilities for health and safety.</td></tr><tr><td colspan="1">Everyone at Faerch plays an important role in maintaining a safe work environment, spanning from top management to the last person employed. Through active engagement and communication at all levels of the organisation, we seek to promote a strong safety culture.</td></tr><tr><td colspan="1">Integrated Management System</td></tr><tr><td colspan="1">Our health and safety management system aims to support our ambitions, and it contains policies that defines responsibilities and obligations to ensure a systematic approach for protecting the health and safety of our employees and contractors.</td></tr><tr><td colspan="1">The health &amp; safety management system will be included in an integrated management system, which is planned to be implemented. the integrated management system will ensure natural integration of health &amp; safety, quality and environmental ambitions in the daily work.</td></tr><tr><td colspan="1">Leadership commitment</td></tr><tr><td colspan="1">Visible leadership commitment is essential to promoting a strong and positive safety culture. Management at all levels at Faerch is obligated to promote and comply with our policy by</td></tr><tr><td colspan="1">•  Encouraging a workplace culture where employees are committed to and accountable for taking care of themselves and colleagues in a healthy and safe way.</td></tr><tr><td colspan="1">•  Ensuring that all our facilities and technical equipment are maintained and meet high safety and appearance standards.</td></tr><tr><td colspan="1">•  Continuously developing and implementing risk management to understand risks, eliminate hazards and reduce impact by engaging employees in the planning and execution.</td></tr><tr><td colspan="1">•  Encouraging employees to work in a safe and healthy way – and to encourage reporting of unsafe and unhealthy situations and conditions.</td></tr><tr><td colspan="1">•  Ensuring that necessary skills and training are available to implement the Health and Safety policy.</td></tr><tr><td colspan="1">•  Engaging customers, employees, contractors, suppliers, and other stakeholders through dialogue to meet our health &amp; safety standards.</td></tr><tr><td colspan="1">Employee engagement</td></tr><tr><td colspan="1">Employee engagement is essential to improving our Health &amp; Safety performance. Employees, temporary workers and contractors must be aware of safety risks and committed to taking appropriate action. This requires a culture where people feel safe to raise safety issues and concerns to colleagues.</td></tr><tr><td colspan="1">Improving our safety reporting with Assure</td></tr><tr><td colspan="1">To align our safety reporting across the Group and to remove barriers to reporting, we introduced a new incident reporting system in 2022. The health and safety software Assure provides us with a comprehensive view of health and safety across our organisation by enabling us to report and capture data with ease. The system helps us to report incidents, near misses and unsafe acts without delay, and it encourages employees to think safety into their daily work.</td></tr><tr><td colspan="1">By implementing Assure, we aim to lower the barrier to recording incidents. The system provides our people with simple, intuitive tools for reporting via PC, laptop, or mobile phone. When an incident is recorded through the system, the local organisation is alerted and can assign tasks to the right people.</td></tr><tr><td colspan="1">For incidents and near misses, a detailed investigation will be launched, and learnings will be distributed. For a reported hazard, the potential risk is removed, and a risk assessment is made.</td></tr><tr><td colspan="1">Records can be made by everyone entering one of Faerch’s sites, including both internal and external personnel. QR codes are placed in tactical locations in every manufacturing site. Simply scan the QR code, click on the link and you are directed to the portal for reporting an incident, near miss or a hazard observation. To overcome language barriers, the system is developed to handle eight languages.</td></tr><tr><td colspan="1">The system includes a task manager providing a comprehensive overview of all tasks related to reported incidents, near misses and hazards. This allows for quick action and effective follow-assessment and follow-up.</td></tr><tr><td colspan="1">Data captured in the Incident reporting system will be available in the Faerch Group Business Intelligence system for reporting and analysis. Incidents, near misses and hazards are categorised, analysed, and managed by Group Health &amp; Safety to make sure that the right safety process improvements are prioritised to make the working environment at Faerch safer.</td></tr><tr><td colspan="1">Risk assessments</td></tr><tr><td colspan="1">In 2023, we will continue to strengthen the health and safety performance across the Group. We incomparable, therefore 2022 serves as our base year. Even though we see a movement in the right direction concerning injuries, we will conduct risk assessments for each individual sites to identify, analyse and control hazards and risks. The risk assessments are essential to preventing potential risks and accidents. The risk assessments will be made in cooperation between the H&amp;S responsible and the employees working on the shopfloor who know the process. This is also a part of the engagement and raising awareness of taking care of your own and your colleagues’ safety.</td></tr><tr><td colspan="1">Safety walks</td></tr><tr><td colspan="1">Another action to come is regular safety walks, where various employees in cooperation with the H&amp;S responsible will go through a planned area to follow up on conditions and behaviour. This will be filled into a template for safety walks. The purpose of the safety walks is to improve awareness of the importance of safety but also to encourage safe behaviour.</td></tr><tr><td colspan="1">Lost Time Injuries</td></tr><tr><td colspan="1">Today, we measure the number of lost time injuries per million working hours (LTIFR). Our target is to continue to decrease this number. In 2022, the LTIFR was 9.4. The acquisition of PACCOR and MCP USA makes historical data incomparable, therefore 2022 serves as our base year. Even though we see a movement in the right direction concerning injuries, we continue to intensify our efforts to drive further improvements. In 2023, our target is to reduce LTIFR to 7.5 reflecting our preventive and systematic approach to safety.</td></tr><tr><td colspan="1">Going forward, we will introduce other KPIs based on data captured in the Incident Reporting system (Assure) to show the maturity of the Health &amp; Safety work on each individual site.</td></tr><tr><td colspan="1">Food safety</td></tr><tr><td colspan="1">Food safety is essential to our business, and consumers should always be confident that the food they buy is safe to consume.</td></tr><tr><td colspan="1">Our aim is to maintain a leading position within rigid food packaging while complying with the strictest food safety requirements. Guaranteeing food safety is our key priority. Without that, our effort to achieve circularity and reduced environmental impacts will have little value.</td></tr><tr><td colspan="1">At Faerch, we therefore continuously develop methods and processes to ensure and validate food safety of our products.</td></tr><tr><td colspan="1">We continuously aim at making the working environment at Faerch safer. Whether you are employed, a temporary worker or contractor</td></tr><tr><td colspan="1">Governance</td></tr><tr><td colspan="1">Act with Responsibility</td></tr><tr><td colspan="1">Responsibility</td></tr><tr><td colspan="1">We are an international organisation committed to act as a proper and responsible group at all times, and we have imposed strict requirements on ourselves, including our employees, officers and directors, as well as our business partners, through internal and external policies and guidelines.</td></tr><tr><td colspan="1">Training in fair competition, anti-corruption and GDPR</td></tr><tr><td colspan="1">We actively support international and national anti-corruption and fair competition efforts, and we are dedicated to upholding the highest standards of integrity and business ethics among our employees and business partners.</td></tr><tr><td colspan="1">We have a zero tolerance against corruption and anti-competitive behaviour.</td></tr><tr><td colspan="1">By implementing and sending out guidelines, policies, e-learning courses and conducting on- site training for officers and employees, we actively fights inappropriate business conduct.</td></tr><tr><td colspan="1">In 2022, 134 employees were trained on-site in anti-corruption and fair competition. A total of 398 employees have received on-site training, including the majority of our officers, directors, managers, sales and procurement personnel. To obtain a beneficial face-to-face dialogue, the on-site training of employees is often held in smaller groups of 5-15 employees.</td></tr><tr><td colspan="1">In addition, a total of 666 employees have completed the e-learning training course in anti-corruption law, and 300 employees have completed the e-learning training programme in competition law. Our PACCOR colleagues did not have this training previously, which explains the relatively low number. The training will be rolled out in 2023 to all relevant employees. The training enables our employees to e.g., execute business negotiations, attend meetings and social events with knowledge and understanding of basic competition law and anti-corruption law in order to protect both themselves and Faerch against prosecution while contributing to upholding a fair and healthy market.</td></tr><tr><td colspan="1">At Faerch, we also process personal data in different areas. To support our officers’ and employees’ understanding of personal data and how to deal with it, Group Legal has implemented a GDPR e-learning course. In 2022, 707 employees have completed the GDPR e-learning course.</td></tr><tr><td colspan="1">Furthermore, Group Legal has prepared several GDPR procedures to ensure basic data subject rights, e.g., the right to access one’s own personal data, the right to rectify one’s personal data, the right to erase one’s personal data. Any such requests from data subjects will be handled and answered by Group Legal.</td></tr><tr><td colspan="1">We have also prepared policies and established technical and organisational measures to ensure</td></tr><tr><td colspan="1">i) that personal data is not accidentally or illegally destroyed, lost or changed, ii) that unauthorised persons do not get access to personal data and iii) that personal data is not processed in breach of GDPR in any other way.</td></tr><tr><td colspan="1">Overall, personal data is deleted when storage of such is no longer needed for the intended and legitimate purposes.</td></tr><tr><td colspan="1">In 2023, Group Legal will continue to focus on overseeing and improving Faerch’s compliance programmes, including policies and internal guidelines on fair competition, anti-corruption and GDPR as well as sanctions, while also focusing on integrating the same principals to PACCOR and MCP USA.</td></tr><tr><td colspan="1">Whistleblower scheme</td></tr><tr><td colspan="1">Our governance programme is designed to identify and prevent serious offences and criminal acts. However, even the most effective compliance procedures cannot fully protect against every conceivable situation.</td></tr><tr><td colspan="1">Consequently, we have implemented a whistleblower scheme in co-operation with a renowned Danish law firm enabling employees, business partners (such as customers and suppliers) and other third parties to report suspicions or knowledge of unethical and/or criminal conduct (on anonymous basis if so desired). The whistleblower scheme includes whistleblower units on entity level. It is ensured that investigators in whistleblower units are – and remain - impartial. If, during the law firm’s and the first whistleblower unit’s investigations and assessments, it is ascertained that a whistleblower filing should be further dealt with, such filing will be reported to impartial members of management for further assessment and action.</td></tr><tr><td colspan="1">The whistleblower scheme was launched in December 2018 and was updated in 2021 pursuant to new EU whistleblower legislation that came into force on 17 December 2021. The whistleblower scheme can be found on our websites. Employees have been informed hereof during compliance training sessions, in internal announcements and in introduction programmes. In 2023, we will look into ways of improving the whistleblower scheme due to a relatively low number of cases being reported to make sure it functions properly.</td></tr><tr><td colspan="1">Supplier Code of Conduct</td></tr><tr><td colspan="1">Faerch conducts business in a conscious way and follows the ten principles of the UN Global Compact. To ensure that our suppliers adhere to the same standards and guidelines as we do, Faerch has developed a ‘Supplier Code of Conduct’.</td></tr><tr><td colspan="1">The ‘Supplier Code of Conduct’ thus reflects the same ten principles as the UN Global Compact which covers human rights, labour rights, the environment and anti-corruption and was updated with improvements in 2022.</td></tr><tr><td colspan="1">Each site director and/or relevant group function of Faerch Group is responsible for ensuring that new suppliers sign Faerch’s ‘Supplier Code of Conduct’, while also ensuring that all signed Code of Conducts are stored within Faerch.</td></tr><tr><td colspan="1">Further, we recognize our responsibility to continuously improve the quality and effectiveness of our human rights, labor rights, environmental and anti-corruption due diligence across operations and business relationships.</td></tr><tr><td colspan="1">In 2022, PACCOR implemented a Supplier Onboarding Process with the purpose of obtaining (additional) relevant information for the due diligence which will e.g. help to secure fundamental human rights and labor rights and thereby proctecting workers in the value chain. This will in 2023 be rolled out to the entire Group.</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">Statutory gender reporting under Danish law Large companies are required to set a target for the share of the underrepresented gender on the Board of Directors.</td></tr><tr><td colspan="1">As of 1 January 2023 large companies are also required to set a target as well as a policy for the share of underrepresented gender at the two management layers below the Board1.</td></tr><tr><td colspan="1">As of 31 December 2022, the Board of Directors is regarded as having equal gender representation and is therefore not legally required to set a gender target for the Board2.</td></tr><tr><td colspan="1">As diversity remains important for the Board, it has maintained a voluntary 2025 target of having at least two shareholder-elected Board members of each gender.</td></tr><tr><td colspan="1">In 2022, the share of women at the two management layers below the Board of Faerch was 25%, but the low level calls for an evaluation of our ability to attract women to leadership positions and not least to retain women in leadership positions. This will allow us to reach our short-term target of minimum 27% women by end 2025, and reaching at least 33% by 2028. It will be the stepping stones towards our long- term target of minimum 40% women at the two management layers below the Board.</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">Data ethics</td></tr><tr><td colspan="1">The responsible use of data is an enabler for Faerch’s business model. In line with our core values we strive to ethically manage and use data, with customers trusting that the company uses their data appropriately. To avoid abuse and privacy infringement issues, and to safeguard the company from legal, business and reputational risks, it is vital to manage and control the storage and use of customers’ and employees’ data ethically and proactively. No formal data ethics policy has been adopted yet due to the strong existing data governance, but in context of the recent acquisitions and as part of the sustainability priorities Faerch will establish a formal data ethics and security policy in 2023, with accompanying governance measures.</td></tr></table> 3411 892800000 753200000 139600000 92000000 45300000 2200000 3900000 -22500000 -21900000 16100000 42700000 -48500000 -4100000 -44400000 500000 -43900000 23700000 5200000 -5000000 -2500000 -28300000 1000000 -27300000 139300000 -19300000 22800000 600000 14300000 -2700000 32300000 3700000 73900000 300000 213300000 -290600000 -258300000 1144600000 1423200000 281800000 23500000 -2800000 <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">Management statement</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">The Executive Management and Board of Directors have today considered and adopted the Annual Report of Faerch A/S for the financial year 1 January – 31 December 2022</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">The Consolidated Financial Statements are prepared in accordance with International Financial Reporting Standards as adopted by the EU and additional requirements in the Danish Financial Statements Act and the Parent Company Financial Statements are prepared in accordance with the Danish Financial Statements Act. Management’s Review is prepared in accordance with the Danish Financial Statements Act.</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">In our opinion, the Consolidated Financial Statements and the Parent Company Financial Statements give a true and fair view of the financial position at 31 December 2022 of the Group and the Company and of the results of the Group and Company operations and consolidated cash flows for the financial year 1 January - 31 December 2022.</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">In our opinion, Management’s Review includes a true and fair account of the development in the operations and financial circumstances of the Group and the Company, of the results for the year and of the financial position of the Group and the Company as well as a description of the most significant risks and elements of uncertainty facing the Group and the Company.</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">We recommend that the Annual Report be adopted at the Annual General Meeting.</td></tr></table> Holstebro 2023-03-27 <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">Independent auditor’s report</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">To the Shareholders of Faerch A/S</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">Opinion</td></tr><tr><td colspan="1">In our opinion, the Consolidated Financial Statements give a true and fair view of the Group’s financial position at 31 December 2022 and of the results of the Group’s operations and cash flows for the financial year 1 January to 31 December 2022 in accordance with International Financial Reporting Standards as adopted by the EU and further requirements in the Danish Financial Statements Act.</td></tr><tr><td colspan="1">Moreover, in our opinion, the Parent Company Financial Statements give a true and fair view of the Parent Company’s financial position at 31 December 2022 and of the results of the Parent Company’s operations for the financial year 1 January to 31 December 2022 in accordance with the Danish Financial Statements Act.</td></tr><tr><td colspan="1">We have audited the Consolidated Financial Statements and the Parent Company Financial Statements of Faerch A/S for the financial year 1 January - 31 December 2022, which comprise income statement, balance sheet, statement of changes in equity and notes, including a summary of significant accounting policies, for both the Group and the Parent Company, as well as statement of comprehensive income and cash flow statement for the Group (“financial statements”).</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">Basis for Opinion</td></tr><tr><td colspan="1">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 Group 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.</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">Statement on Management’s Review</td></tr><tr><td colspan="1">Management is responsible for Management’s Review.</td></tr><tr><td colspan="1">Our opinion on the financial statements does not cover Management’s Review, and we do not express any form of assurance conclusion thereon.</td></tr><tr><td colspan="1">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.</td></tr><tr><td colspan="1">Moreover, it is our responsibility to consider whether Management’s Review provides the information required under the Danish Financials Statements Act.</td></tr><tr><td colspan="1">Based on the work we have performed, in our view, Management’s Review is in accordance with the Consolidated Financial Statements and the Parent Company Financial Statements and has been prepared in accordance with the requirements of the Danish Financial Statement Act. We did not identify any material misstatement in Management’s Review.</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">Management’s Responsibilities for the Financial Statements</td></tr><tr><td colspan="1">Management is responsible for the preparation of Consolidated Financial Statements that give a true and fair view in accordance with International Financial Reporting Standards as adopted by the EU and further requirements in the Danish Financial Statements Act and for the preparation of Parent Company 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.</td></tr><tr><td colspan="1">In preparing the financial statements, Management is responsible for assessing the Group’s and the Parent 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 Group or the Parent Company or to cease operations, or has no realistic alternative but to do so.</td></tr></table> <table xmlns="http://www.w3.org/1999/xhtml" style="border-right: 0px; border-top: 0px; border-left: 0px; width: 650px; border-bottom: 0px; border-collapse: collapse" width="100%"><tr><td colspan="1">Auditor’s Responsibilities for the Audit of the Financial Statements</td></tr><tr><td colspan="1">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.</td></tr><tr><td colspan="1">As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we exercise professional judgement and maintain professional scepticism throughout the audit. We also</td></tr><tr><td colspan="1">-    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.</td></tr><tr><td colspan="1">-    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 Group’s and the Parent Company’s internal control.</td></tr><tr><td colspan="1">-    Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management.</td></tr><tr><td colspan="1">-    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 Group’s and the Parent 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 Group and the Parent Company to cease to continue as a going concern.</td></tr><tr><td colspan="1">-   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.</td></tr><tr><td colspan="1">-   Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the Consolidated Financial Statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.</td></tr><tr><td colspan="1">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.</td></tr></table> Aarhus 2023-03-27 Årsrapport 33771231 PricewaterhouseCoopers Statsautoriseret Revisionspartnerselskab Strandvejen 44 2900 Hellerup xWizard version 1.1.1186.0, by EasyX Aps. www.easyx.eu 2021-01-01 2021-12-31 Revisionspåtegning Grundlag for konklusion Konklusion 2237 558800000 429000000 129700000 66800000 29400000 1800000 2100000 -11500000 21600000 12900000 60000000 -25400000 600000 -26000000 0 -26000000 1800000 400000 6300000 3200000 -21500000 0 -21500000 115700000 -26400000 23000000 0 8500000 0 32400000 2100000 39200000 1200000 152300000 -192300000 -160000000 1063700000 1217800000 148000000 -12000000 1000000 1027800000 156500000 453900000 19500000 1657800000 207300000 397100000 31000000 64700000 700100000 28900000 16500000 1900000 2405200000 212500000 139400000 30900000 8200000 4500000 5300000 48800000 449500000 2854700000 10700000 -2000000 1183300000 1192000000 4800000 1196700000 1052500000 4000000 181300000 1237800000 90500000 16800000 185200000 13200000 300000 3800000 106100000 4300000 420200000 1658000000 2854700000 11800000 576500000 155700000 169900000 10500000 912600000 99200000 173000000 25500000 23000000 320800000 10000000 0 0 1243300000 102000000 93600000 13400000 1300000 200000 1900000 8900000 221300000 1464600000 9800000 500000 643900000 654200000 0 654200000 505500000 0 93800000 599300000 44900000 22300000 86100000 6200000 700000 0 49900000 1100000 211100000 810400000 1464600000 -8900000 Profit before tax -48500000 Profit before tax -25400000 Proceeds from capital increase / shareholder contribution 565700000 Proceeds from capital increase / shareholder contribution 280000000 Borrowings from parent company -5300000 Borrowings from parent company 22100000 -8900000 2100000 Lars Gade Hansen CEO Arne Holme CTO Jesper Emil Jensen Regional CEO Continental Europe Tom Sand-Kristensen CFO Henrik Poulsen Chair Jaska de Bakker Ronald John Edward Marsh Marianne Kirkegaard Jan Thorsgaard Nielsen Deputy Chair Sven Seidel Brian Troldtoft Pedersen Employee representative Torben Toft Jensen Employee representative Thomas Skovgaard Lauridsen Employee representative PricewaterhouseCoopers Statsautoriseret Revisionspartnerselskab 33771231 Claus Lindholm Jacobsen State Authorised Public Accountant mne23328 Jens Weiersøe Jakobsen State Authorised Public Accountant mne30152 33771231 PricewaterhouseCoopers Statsautoriseret Revisionspartnerselskab