Årsrapport33771231PricewaterhouseCoopers Statsautoriseret RevisionspartnerselskabStrandvejen 442900 Hellerup2013-07-012014-06-3015682892Envikraft A/SIndustrivej95260Odense SOdensePricewaterhouseCoopers Statsautoriseret Revisionspartnerselskab33771231Rytterkasernen215100Odense CDanmark2014-11-28Jacob Østergaard BergenholtzRegnskabsklasse BRevisionspåtegningOdense2014-11-28Michael EngstedOle Sodtmann BundgaardJacob Østergaard BergenholtzChairmanNiels Lykke GraugaardLeif Østergaard NielsenLars Thorsgaard JensenOdense2014-11-28Odense2014-11-28PricewaterhouseCoopers Statsautoriseret RevisionspartnerselskabLine HedamState Authorised Public AccountantBrian PetersenState Authorised Public Accountant651538-130813881297147411241909894195962260202940450001237747119882319054951631179-2443407-23085751-413497-5614010-2029910-17471741-2029910-174717410000090124090124180034179085180034179085180034269209015291171007577319614372181761259246839880312965755363231009257358736909231530833010474416225939663011341392182362305496072398992413965058140079275399197901000000100000010000001000000-24786115-26485205-23786115-254852059136061904828691360619048286108000010000000597655849271412833111558555918260751253609382692223444516450115472932956356709547293295635670940079275399197901000000-198261630-665904203729000-20299101000000-24786115439089766800144157986444316085293374800004379934948049381656563751905495163117900-352264-4149729-61233-1464281-413497-561401040000004000000400000040000000467699-22877023892937757560720-19936623892901790859491800342641334422078949689757-734901917062476972752624808551The Executive and Supervisory Boards have today considered and adopted the Annual Report of Envikraft A/S for the financial year 1 July 2013 - 30 June 2014.The Annual Report is prepared in accordance with the Danish Financial Statements Act.In our opinion the Financial Statements give a true and fair view of the financial position at 30 June 2014 of the Company and of the results of the Company operations for 2013/14.We recommend that the Annual Report be adopted at the Annual General Meeting.To the Shareholder of Envikraft A/SWe have audited the Financial Statements of Envikraft A/S for the financial year 1 July 2013 - 30 June 2014, which comprise income statement, balance sheet, statement of changes in equity, notes and summary of significant accounting policies. The Financial Statements are prepared in accordance with the Danish Financial Statements Act.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.Our responsibility is to express an opinion on the Financial Statements based on our audit. We conducted our audit in accordance with International Standards on Auditing and additional requirements under Danish audit regulation. This requires that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the Financial Statements are free from material misstatement. An audit involves performing audit procedures to obtain audit evidence about the amounts and disclosures in the Financial Statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the Financial Statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company’s preparation of Financial Statements that give a true and fair view 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. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by Management, as well as evaluating the overall presentation of the Financial Statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Our audit has not resulted in any qualification.Opinion In our opinion, the Financial Statements give a true and fair view of the financial position of the Company at 30 June 2014 and of the results of the Company operations for the financial year 1 July 2013 - 30 June 2014 in accordance with the Danish Financial Statements Act.We have read Management’s Review in accordance with the Danish Financial Statements Act. We have not performed any procedures additional to the audit of the Financial Statements. On this basis, in our opinion, the information provided in Management’s Review is in accordance with the Financial Statements.Main activity The Company’s main activities are conceptual development, design, marketing and supply of incineration systems in which fuel comprises various types of waste. Envikraft supplies incineration systems for domestic waste, hospital waste, radioactive waste and various industrial by-products. Development in the year The income statement of the Company for 2013/14 shows a loss of DKK 2,029,910, and at 30 June 2014 the balance sheet of the Company shows negative equity of DKK 23,786,115. In the financial year 2013/14, substantial unexpected cost was incurred related to projects and obligations from earlier years. Since these related to previous years, the results for 2013/14 have been adjusted, and we refer to the mention of the correction of fundamental errors under accounting policies. The loss for financial year 2013/14 is primarily caused by extra costs identified in the closing phase of delayed projects. Management expects to restore equity through future earnings. Subsequent events No events materially affecting the assessment of the Annual Report have occurred after the balance sheet date.With reference to the company's financial situation the sister company Weiss A/S has issued a letter of subordination which is valid until 30th June 2015.The share capital consists of 1.000 shares of a nominal value of DKK 1.000. No shares carry any special rights.The Company provides warranties of 2 to 5 years on some of its products and is therefore obliged to repair or replace goods which are not satisfactory. Other provisions include work-in-progress projects with negative gross margin (provision for onerous contracts). Warranty provisions 200.000 112.225 Other provisions 8.936.061 8.936.061 9.136.061 9.048.286 Rental agreements and leases Rental agreement, non-cancellation period of 3.5 years 1.249.675 1.606.725 Security The following assets have been placed as security with bankers: Floating charge totaling TDKK 3,000 with security in receivables, inventories, other fixtures, fittings and equipment with a carrying value of 0 13.394.411 Contingent liabilities The Danish companies of the group are jointly and severally liable for tax on consolidated taxable income in the tax year 2014. The company has performance and payment guarantees totalling TDKK 5,747. The company has given absolute guarantees for sister company's bank debt, as per June 30, 2014 totalling TDKK 18,974.Basis Controlling interest Envikraft Invest A/S Parent Company Anpartselskabet af 14. oktober 2013 Ultimate parent Ownership The following shareholder is recorded in the Company's register of shareholders as holding at least 5% of the votes or at least 5% of the share capital: Envikraft Invest A/S, Industrivej 9, 5260 Odense S, Cvr.: 15 68 28 92. The Company is included in the Group Annual Report of Envikraft Invest A/S, Industrivej 9, 5260 Odense S, Cvr.: 15 68 28 92. Furthermore, the Company is included in the Group Annual Report of the ultimate parent Anpartselskabet af 14. oktober 2013, Avderødvej 27 C, 2980 kokkedal, Cvr.: 35 51 55 77.Financial Statements of Envikraft A/S for 2013/14 has been prepared in accordance with the provisions of the Danish Financial Statements Act applying to enterprises of reporting class B as well as selected rules applying to reporting class C. The accounting policies applied remain unchanged from last year. Financial Statements for 2013/14 are presented in DKK. Fundamental errors The financial report 2012/13 was influenced by historical accounting errors, so called fundamental errors, which were corrected in the equity as of 30.06.12. After the acquisition by Weiss Partners in November 2013, a new management has been put in place, and the new management has discovered that not all fundamental errors were identified and corrected last year. This year the remaining fundamental errors, which are of the same nature as in 2012/13, have now been corrected in the equity value as of 30.06.13. The fundamental errors consist mainly of wrong and extraordinary low estimates in the total cost to complete 2 major projects per 30.06.13, and this wrong estimate has been corrected with a total pretax value of 7.761.897 DKK. Revenues are recognised in the income statement as earned. Furthermore, value adjustments of financial assets and liabilities measured at fair value or amortised cost are recognised. Moreover, all expenses incurred to achieve the earnings for the year are recognised in the income statement, including depreciation, amortisation, impairment losses and provisions as well as reversals due to changed accounting estimates of amounts that have previously been recognised in the income statement. Assets are recognised in the balance sheet when it is probable that future economic benefits attributable to the asset will flow to the Company, and the value of the asset can be measured reliably. Liabilities are recognised in the balance sheet when it is probable that future economic benefits will flow out of the Company, and the value of the liability can be measured reliably. Assets and liabilities are initially measured at cost. Subsequently, assets and liabilities are measured as described for each item below.Transactions in foreign currencies are translated at the exchange rates at the dates of transaction. Gains and losses arising due to differences between the transaction date rates and the rates at the dates of payment are recognised in financial income and expenses in the income statement. Where foreign exchange transactions are considered hedging of future cash flows, the value adjustments are recognised directly in equity. Receivables, payables and other monetary items in foreign currencies that have not been settled at the balance sheet date are translated at the exchange rates at the balance sheet date. Any differences between the exchange rates at the balance sheet date and the transaction date rates are recognised in financial income and expenses in the income statement. Fixed assets acquired in foreign currencies are measured at the transaction date rates.Revenue from the sale of goods for resale and finished goods is recognised in the income statement when delivery and transfer of risk to the buyer have been made before year end. Revenue is recognised exclusive of VAT and net of discounts relating to sales. Contract work in progress concerning equipment for the manufacturing of furniture is recognised at the rate of completion, which means that revenue equals the selling price of the work completed for the year (percentage-of-completion method). This method is applied when total revenues and expenses in respect of the contract and the stage of completion at the balance sheet date can be measured reliably, and it is probable that the economic benefits, including payments, will flow to the Company.Cost of sales comprises costs incurred to achieve revenue for the year. Cost comprises raw materials, consumables, direct labour costs and indirect production costs such as maintenance and depreciation, etc, as well as operation, administration and management of factories. Cost of sales also includes research and development costs that do not qualify for capitalisation as well as amortisation of capitalised development costs. Furthermore, amortisation of goodwill is included to the extent that goodwill relates to production activities. Finally, provisions for losses on contract work are recognised.Distribution expenses comprise costs in the form of salaries to sales and distribution staff, advertising and marketing expenses as well as operation of motor vehicles, depreciation, etc. Amortisation of goodwill is also included to the extent that goodwill relates to distribution activities.Administrative expenses comprise expenses for Management, administrative staff, office expenses, depreciation, etc. Amortisation of goodwill is also included to the extent that goodwill relates to administrative activities.Other operating income and other operating expenses comprise items of a secondary nature to the core activities of the enterprise, including gains and losses on the sale of intangible assets and property, plant and equipment.Financial income and expenses are recognised in the income statement at the amounts relating to the financial year.Tax for the year consists of current tax for the year and changes in deferred tax for the year. The tax attributable to the profit for the year is recognised in the income statement, whereas the tax attributable to equity transactions is recognised directly in equity. The Company is jointly taxed with wholly owned Danish and foreign subsidiaries. The tax effect of the joint taxation is allocated to Danish enterprises in proportion to their taxable incomes.Development costs and costs relating to rights developed by the Company are recognised in the income statement as costs in the year of acquisition.Property, plant and equipment are measured at cost less accumulated depreciation and less any accumulated impairment losses. Cost comprises the cost of acquisition and expenses directly related to the acquisition up until the time when the asset is ready for use. In the case of assets of own construction, cost comprises direct and indirect expenses for labour, materials, components and sub-suppliers. Depreciation based on cost reduced by any residual value is calculated on a straight-line basis over the expected useful lives of the assets, which are: Other fixtures and fittings, tools and equipment 3-5 years The carrying amounts of intangible assets and property, plant and equipment are reviewed on an annual basis to determine whether there is any indication of impairment other than that expressed by amortisation and depreciation. If so, the asset is written down to its lower recoverable amount.Inventories are measured at the lower of cost under the FIFO method and net realisable value. The net realisable value of inventories is calculated at the amount expected to be generated by sale in the process of normal operations with deduction of selling expenses and costs of completion. The net realisable value is determined allowing for marketability, obsolescence and development in expected sales sum. The cost of goods for resale, raw materials and consumables equals landed cost. The cost of finished goods and work in progress comprises the cost of raw materials, consumables and direct labour with addition of indirect production costs. Indirect production costs comprise the cost of indirect materials and labour as well as maintenance and depreciation of the machinery, factory buildings and equipment used in the manufacturing process as well as costs of factory administration and management.Receivables are measured in the balance sheet at the lower of amortised cost and net realisable value, which corresponds to nominal value less provisions for bad debts. Provisions for bad debts are determined on the basis of an individual assessment of each receivable, and in respect of trade receivables, a general provision is also made based on the Company’s experience from previous years.Contract work in progress is measured at the selling price of the work performed calculated on the basis of the stage of completion. The stage of completion is measured by the proportion that the resources incurred to date bear to the estimated total resources. Where it is probable that contract expenses will exceed total revenues from a contract, the expected loss is recognised as an expense in the income statement. Where the selling price cannot be measured reliably, the selling price is measured at the lower of expenses incurred and net realisable value. Prepayments and payments received on account are set off against the selling price. The individual contracts are classified as receivables when the net selling price is positive and as liabilities when the net selling price is negative. Expenses relating to sales work and the winning of contracts are recognised in the income statement as incurred.Prepayments comprise prepaid expenses concerning rent, insurance premiums, subscriptions and interest.Dividend distribution proposed by Management for the year is disclosed as a separate equity item.Deferred income tax is measured using the balance sheet liability method in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes on the basis of the intended use of the asset and settlement of the liability, respectively. Deferred tax assets, including the tax base of tax loss carry-forwards, are measured at the value at which the asset is expected to be realised, either by elimination in tax on future earnings or by set-off against deferred tax liabilities within the same legal tax entity. Deferred tax is measured on the basis of the tax rules and tax rates that will be effective under the legislation at the balance sheet date when the deferred tax is expected to crystallise as current tax. Any changes in deferred tax due to changes to tax rates are recognised in the income statement.Current tax liabilities and receivables are recognised in the balance sheet as the expected taxable income for the year adjusted for tax on taxable incomes for prior years and tax paid on account. Extra payments and repayment under the on-account taxation scheme are recognised in the income statement in financial income and expenses.Other debts are measured at amortised cost, substantially corresponding to nominal value.Deferred income comprises payments received in respect of income in subsequent years.156828922013-07-01e:ContributedCapitalMember156828922013-07-012014-06-30e:ContributedCapitalMember156828922014-06-30e:ContributedCapitalMember156828922013-07-01e:RetainedEarningsMember156828922013-07-012014-06-30e:RetainedEarningsMember156828922014-06-30e:RetainedEarningsMember156828922013-07-012014-06-30156828922013-07-012014-06-302156828922013-07-012014-06-301156828922013-07-012014-06-301156828922013-07-012014-06-302156828922013-07-012014-06-303156828922013-07-012014-06-304156828922013-07-012014-06-301156828922013-07-012014-06-302156828922012-07-012013-06-30156828922013-07-012014-06-30e:RetainedEarningsMember156828922012-07-012013-06-30e:RetainedEarningsMember156828922013-06-30156828922014-06-30156828922013-07-01e:CompletedDevelopmentProjectsMember156828922014-06-30e:CompletedDevelopmentProjectsMember156828922013-07-01e:FixturesFittingsToolsAndEquipmentMember156828922013-07-012014-06-30e:FixturesFittingsToolsAndEquipmentMember156828922014-06-30e:FixturesFittingsToolsAndEquipmentMember156828922014-06-301156828922013-07-01e:OtherReceivablesMember156828922013-07-012014-06-30e:OtherReceivablesMember156828922014-06-30e:OtherReceivablesMemberiso4217:DKK