25305639 2023-04-01 2024-03-31 25305639 2023-04-01 2024-03-31 1 25305639 2023-04-01 2024-03-31 1 25305639 2023-04-01 2024-03-31 2 25305639 2023-04-01 2024-03-31 3 25305639 2023-04-01 2024-03-31 4 25305639 2023-04-01 2024-03-31 5 25305639 2023-04-01 2024-03-31 1 25305639 2024-03-31 25305639 2022-04-01 2023-03-31 25305639 2023-03-31 25305639 2023-03-31 fsa:ContributedCapitalMember 25305639 2023-03-31 fsa:RetainedEarningsMember 25305639 2023-03-31 fsa:ProposedDividendRecognisedInEquityMember 25305639 2023-04-01 2024-03-31 fsa:ContributedCapitalMember 25305639 2023-04-01 2024-03-31 fsa:RetainedEarningsMember 25305639 2023-04-01 2024-03-31 fsa:ProposedDividendRecognisedInEquityMember 25305639 2024-03-31 fsa:ContributedCapitalMember 25305639 2024-03-31 fsa:RetainedEarningsMember 25305639 2024-03-31 fsa:ProposedDividendRecognisedInEquityMember xbrli:pure iso4217:DKK Lene Kalhøj The Executive Board and Board of Directors have today considered and adopted the Annual Report of OFS Fitel Denmark ApS for the financial year April 1, 2023 - March 31, 2024. 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 as of March 31, 2024 of the Company and of the results of the Company operations for 2023/24. In our opinion, Management's Review includes a true and fair account of the matters addressed in the Review. We recommend that the Annual Report be adopted at the Annual General Meeting. Brøndby, Erik Gustav Børgesen CEO Jane Lusa Cercena Toshio Kimura RichardSteve Allen Chairman Michael F. Pedersen Tommy Geisler Staff Representative Staff Representative To the Shareholders of OFS Fitel Denmark ApS We have audited the financial statements of for the financial year 01.04.2023 - 31.03.2024, which comprise the income statement, balance sheet, statement of changes in equity, cash flow statement and notes, including a summary of significant accounting policies. The financial statements are prepared in accordance with the Danish Financial Statements Act. In our opinion, the financial statements give a true and fair view of the Entity’s financial position at 31.03.2024 and of the results of its operations and cash flows for the financial year 01.04.2023 - 31.03.2024 in accordance with the Danish Financial Statements Act. We conducted our audit in accordance with International Standards on Auditing (ISAs) and 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 this auditor’s report. We are independent of the Entity 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 Entity’s ability to continue as a going concern, for disclosing, as applicable, matters related to going concern, and for using the going concern basis of accounting in preparing the financial statements unless Management either intends to liquidate the Entity 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 judgement and maintain professional scepticism 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 Entity’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 Entity’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 Entity to cease to continue as a going concern. • Evaluate the overall presentation, structure and content of the financial statements, including the disclosures in the notes, and whether the financial statements represent the underlying transactions and events in a manner that gives a true and fair view. 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. Management is responsible for the management commentary. Our opinion on the consolidated financial statements and the parent financial statementsdoes 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 the management commentary and, in doing so, consider whether the management commentary is materially inconsistent with the financial statements, or our knowledge obtained in the audit or otherwise appears to be materially misstated. Moreover, it is our responsibility to consider whether the management commentary provides the information required under the Danish Financial Statements Act. Based on the work we have performed; we conclude that the management commentary is in accordance with the financial statements and has been prepared in accordance with the requirements of the Danish Financial Statements Act. We did not identify any material misstatement of the management commentary. Copenhagen, Deloitte Statsautoriseret Revisionspartnerselskab 33963556 Eskild Nørregaard Jakobsen State Authorised Public Accountant mne11681 OFS Fitel Denmark ApS Priorparken 680 DK 2605 Brøndby 25305639 Brøndby Weidekampsgade 6 DK 2300 København S Seen over a five-year period, the development of the Company is described by the following financial highlights: The figures for 2021/22 have been updated due to the change of accounting policy for right of use assets in the financial year 2023/24. The comparison figures for the financial years 2020/21 and previous years have not been changed. Financial Statements of OFS Fitel Denmark ApS for 2023/24 has been prepared in accordance with the provisions of the Danish Financial Statements Act applying to large enterprises of reporting class C. Development in the year The income statement of the company for 2023/24 shows a profit of 158.0 mDKK, and as of 31 March 2024 the balance sheet of the company shows equity of 443.6 mDKK. The past year and follow-up on development expectations from last year The financial statements show a profit of 158.0 mDKK, which is considered being satisfying. Special risks – operating risks and financial risks Foreign exchange risks Most of the revenue in the company is in foreign currency, and especially the FX rate in USD has an impact on sales and earnings DKK. This risk is primarily offset by making purchases in USD, however not eliminating the currency risk entirely. Targets and expectations for the year ahead The revenue for 2024/25 is expected to be in line with current year. We have seen a light market for specialty fiber, whereas Ocean transmission fiber is expected to be at the same level as last year. Over all operating result is expected to be in line with current year. Research and development Research and development activities are primarily focused on product and process development within the Company’s existing product areas. Efforts are being made to improve existing products and develop new products to maintain or grow our market position. Projects are in many cases carried out in cooperation with other OFS and Furukawa companies as well as various universities. Intellectual capital resources The Vision of the company is: To become the most trusted and innovative provider of fiber optic solutions, inspiring employees, and customers to transform the way the world communicates, works, and lives. The Company has a global leading position with respect to both delivery time/ability and product quality. This obviously means that it is important to retain qualified and innovative employees. The Company has succeeded in maintaining the critical knowledge of the Company and keeping the turnover of staff at a lower level. Uncertainty relating to recognition and measurement Recognition and measurement in the Annual Report have not been subject to any uncertainty. Unusual events The financial position on 31 March, 2024 of the Company and the results of the activities of the Company for the financial year for 2023/24 have not been affected by any unusual events. Subsequent events No events materially affecting the assessment of the Annual Report occurred after the balance sheet date. Key activities The objects for which the Company is established are to develop, produce and market high technology products within the fields of telecommunication and data transfer, and carry on all such other business activities as the board of directors deems to the attainment of such objects. Statement of corporate social responsibility cf. Danish Financial Statements Act §99a In 2024 we are initiating a CSRD initiative in order to reduce our environmental footprints, as well as increase focus on sustainable development targets. Business Model The objectives for which the Company is established are to develop, produce and market high technology products within the fields of telecommunication and data transfer. The products are produced in Denmark and sold both in Denmark and abroad. Social conditions and employee relations Reference is made to the OFS Group’s website that describes the policies and guidelines for social conditions, employee conditions, anti-corruption, environment and respect for human rights that also apply to OFS Fitel Denmark ApS. The policies cover areas such as maintaining a safe working environment and working for equality and against discrimination, which is areas where we see the main risk for employees. https://www.ofsoptics.com/wp-content/uploads/OFS-Corporate-Social-Responsibility-Policy.pdf The company and its activities are in Denmark. The Company is therefore regularly monitoring Danish and EU legislation as part of the normal compliance procedures and obligations. When new applicable legislation is identified, the QHSE department will start the procedures to obtain the necessary level of compliance. Emergency plans and similar are evaluated and updated regularly. OFS Fitel Denmark ApS has a focus on prevention of safety incidents through training and a proactive safety effort. Our Employees contribute to this preventive effort by registration of all near misses and safety observations. In 2023/24 190 safety observations were registered, and work procedures were updated because of these observations. The company will continue this work in the future, and we expect the number of observations to be similar or higher in 2024/25. The number of industrial injuries is low, which is attributable to preventive environmental and safety work carried out in the Company. The Company believes that the measures that were taken in 2023/24 have contributed to a safe working environment and will maintain a focus on safe working environment in the future. Human rights Furukawa Electric group CSR Code of Conduct is the basis for behavior for our directors and employees: Respect the human rights of all people and do not engage in discrimination or harassment on the grounds of race, nationality, creed, religion, gender, sexual identity, sexual orientation, social origin, age, disability, academic background, or family circumstances. Using biannual employee satisfaction surveys and annual employee interviews the company interacts with the employees to work for equality and against discrimination. OFS Fitel Denmark ApS has evaluated the risk of human rights breaches to be low and we are not aware of violations regarding human rights in OFS Fitel Denmark ApS in 2023/24. We will continue to monitor any potential violations in the coming year. Environment and climate Company policies in this area are based on the overall guidelines for OFS, supplemented with local aspects. The policies cover, among other things, continuous replacement of existing production equipment for more environmentally friendly machines and furnaces, and by reprocessing the elements in the waste materials and reusing elements from the production, including Germanium. The company has assessed that the main risk is the company’s CO2 emissions. The company is actively working on reducing CO2 emissions and will continue to do so. The efforts made this year to reduce CO2 emissions include swapping lighting for LEDs and replacing ventilation fan with a more energy efficient one. All replacements are done when replacement is needed. Manufacturing the Company’s products does not require special environmental approval. The Quality Management System is certified against ISO9001 (re-certification in 2023). The Health, Safety & Environmental Management System is based on Danish and European legislation and inspired by ISO14001 and ISO45001. The past years The Company has continuously been improving processes and procedures to become compliant with ISO14001 and ISO45001. We will continue to work towards getting certification in 2025. Anti-corruption and bribery There may be a risk that employees unjustifiably give gifts or other means to unjustly influence a stakeholder. This could have consequences for the Company’s reputation. The Company has a zero-tolerance policy on corruption and bribery and works actively to counter this. We will continue doing so in the coming year. The Company issues its guidelines to employees regarding anti-corruption and bribery. Furthermore the company has made the rules available to all employees on the employee communication platform. The Company is not aware of any violations regarding corruption and bribery in OFS Fitel Denmark ApS in 2023/24 and we believe that the current actions taken in order to prevent corruption and bribery by OFS Fitel Denmark is sufficient. The company has a Whistleblower hotline for all to report any concerns or complaints about possible violations of law or of the companies code of conduct, human rights etc. Throughout the financial year 2023/24 we have had 0 reports though the Whistleblowers hotline. The company does not have guidelines on gender composition. However, it has the focus of the company, and we perform an annual evaluation of the gender composition with the aim to ensure equality between men and women. Top management The gender distribution among the Company’s 3 board members elected on the General Meeting totaled March 31, 2024, as follows: 67% men and 33% women, which is considered equal gender representation. We do not have a specific target set for the future but strive to keep this distribution going forward. Other management The gender distribution among our other layers of management is today 57% male and 43% female. Increasing the share of the under-represented gender at OFS Gender equality in management is a high priority in OFS Fitel Denmark ApS. Reflecting society at large in terms of gender composition helps us compose the best possible management, improves our competitive strengths, and enables us to achieve more success. All employees, regardless of gender, should have equal opportunities for qualifying for a given position, and we will work to promote gender equality in management by recruiting and retaining candidates of both genders. Our objective is to increase the share of women to ensure that the company achieves gender equality in management as described in section 99 b of the Danish Financial Statements Act. Definition of targets for increasing the share of the under-represented gender: Current status: 2023/24 Total number of members of the board of directors: 3 Share of the under-represented gender on the board of directors: 33% Target for the under-represented gender at the board of directors: 33% Target achieved Total number of members at other levels of management: 7 Share of the under-represented gender at other levels of management: 43% Target for the under-represented gender at other levels of management: 40% Target achieved HR assesses whether the measures taken in the recruiting and promotion processes have the intended effect and reports back to the board of directors with a status on the initiatives to increase the share of the under-represented gender. The gender distribution among the Company’s 3 board members elected on the General Meeting totaled March 31, 2024, as follows: 67% men and 33% women, which is considered equal gender representation. We do not have a specific target set for the future but strive to keep this distribution going forward. 3 7 0.33 0.33 The gender distribution among our other layers of management is today 57% male and 43% female. 0.43 0.40 Statement on data ethics cf. Danish Financial Statements Act 99d OFS Fitel Denmark ApS has a written ‘databeskyttelsespolitik’, as part of our overall quality system. The policy complies with both Danish and EU law on data and privacy protection. The policy describes the rules and principles for handling personal and other data. All employees sign in connection with the employment policy. The policy is evaluated regular to ensure compliance with Danish and EU law. Based on the above and the level of data that we work with, we have not found it necessary to develop a specific policy around data ethics. 493352000 620210000 331541000 441378000 161811000 178832000 11501000 10983000 37758000 35467000 112552000 132382000 74356000 0 541000 6589000 18053000 8582000 0 0 204420000 134375000 46371000 29313000 158049000 105062000 15980000 18383000 1263000 1617000 15580000 13256000 4212000 4431000 63734000 60921000 100769000 98608000 0 147525000 0 147525000 100769000 246133000 86666000 106687000 55722000 89092000 343571000 390277000 2100000 13000000 1685000 546000 403078000 492915000 11492000 3417000 501236000 603019000 602005000 849152000 26000000 26000000 267666000 259617000 150000000 300000000 443666000 585617000 0 0 34119000 34119000 34119000 34119000 56304000 53565000 56304000 53565000 20650000 51299000 4571000 70454000 0 10200000 9578000 8045000 13551000 4705000 19566000 31148000 67916000 175851000 124220000 229416000 602005000 849152000 26000000 259617000 300000000 585617000 0 0 300000000 300000000 0 8049000 150000000 158049000 0 0 0 0 26000000 267666000 150000000 443666000 1. Revenue Geographical segments Revenue, Denmark 6,200273Revenue, exports 487,152619,937493,352620,210Business segments Goods for resale 22,96575,466Own production 469,269 544,744License 1,1180493,352620,210 2. Staff Wages and Salaries 108,070 123,904Pensions 23,59623,431Other social security expenses 1,5591,449133,225148,784Wages and Salaries, pensions and other social expenses are recognized in the following items:Cost of sales 107,566 120,664Distribution expenses 10,02110,974Administrative expenses 15,63817,146133,225148,784 Including remuneration to the Executive Board 3,943 4,102 190 212 3. Other operating income and expenses In 2023/24 the other operating income mainly consists of gain relating to sale of part of the business. The gain amounts to KDKK 63.533 Other operating expenses consist of warranty cost and in 2022/23 the majority of the cost related to to the support on sale of part of the business. 4. Financial income Interest from group enterprises 9,801 6,059Other financial income 664 152Exchange rate gains 7,5882,37118,0538,582 5. Tax on profit/loss for the year Current tax for the year 36,333 20,738Deferred tax for the year 8,6848,610Deferred tax for previous years 2,216 0Adjustment of tax concerning previous years -862-3546,37129,313Tax on profit/loss for the year is calculated as follows: Calculated 22% tax on profit/loss for the year before tax 44,975 29,562Tax effect of: Tax on non-deductible expenses and non-taxable income 42-214Non-capitalised deferred tax 2,2160Adjustment of tax concerning previous years -862-3546,37129,313 20242023kDKKkDKKDepreciation and impairment of property, plant and equipment assets are recognized in the following items:Cost of sales 14,480 32,80014,48032,800 7. Inventories Raw materials and consumables 37,573 86,408Work in progress 355798Finished goods and goods for resale 48,73819,48186,666106,687 8. Prepayments Prepayments consist of prepaid expenses concerning rent, insurance premiums, subscriptions and interest. 9. Equity The share capital consists of 26,000 shares of a nominal value of KDKK 1,000. No shares carry any special rights. 10. Other provisions Other provisions 34,119 34,11934,11934,119At the balance sheet date, the restoration obligation according to the lease of the premises amounts to KDKK34,119. 11. Deferred tax asset Deferred tax asset at 1 April 13,00014,450Change in deferred tax regarding transfer of business within the group 0 7,160Amounts recognized in the income statement for the year -8.684-8,610Adjustment deferred tax prior year -2.216 0Deferred tax asset at 31 March 2,10013,000 158049000 194938000 13. Contingent assets, liabilities, and other financial obligations rdThe Company has provided bank guarantees in favor of 3 parties of total kDKK 33,037 (2023: KDKK 32,872). OFS Fitel Denmark ApS and a former Subsidiary were jointly and severally liable for tax on the jointly sttaxed incomes etc. in these companies until July 1 2023. Moreover, the Danish group companies were jointly and severally liable for Danish withholding taxes by way of dividend tax, tax on royalty payments and tax on unearned income. Any subsequent adjustments of corporation taxes and stwithholding taxes before July 1 2023 may increase the Company’s liabilities. OFS Fitel Denmark ApS were the administration company for the joint tax in Denmark. 14. Related parties Controlling interest Basis Furukawa Electric Co., Tokyo, Japan Ultimate controlling shareholder OFS Fitel, LLC, Norcross, USA Immediate controlling shareholder Other related parties Jane Lusa Cercena Chairman of the Board Richard Steve Allen Member of the Board Toshio Kimura Member of the Board Tommy Geisler Member of the Board Michael F. Pedersen Member of the Board Transactions During the year, the Company had the following transactions with its ultimate Parent Company and its subsidiaries: Corporate allocation fee for the year amounts to kDKK 15,847 (2023: kDKK 14,848). Acquisition of goods from associates, kDKK 35,610 (2023: kDKK 133,258) Sales of goods to group enterprises, kDKK 229,792 (2023: kDKK 220,603) Receivables from group enterprises, kDKK 343,571 (2023: kDKK 390,277) Payable to group enterprises, kDKK 4,571 (2023: kDKK 70,454) Joint tax fee, 0 kDKK (2023: kDKK 10,200) Consolidated Financial Statements The Company is included in the Group Annual Report of the Parent Company of the largest and smallest group: Name Place of registered office Furukawa Electric Co., Ltd. Japan OFS Fitel, LLC, Norcross, USA USA The Group Annual Report of Furukawa Electric Co., Ltd. May be obtained at following address: Furukawa Electric Co., Ltd. 6-1, Marunouchi, 2-chome, Chiyoda-ku Tokyo 10-8322 Japan The Group Annual Report of OFS Fitel, LLC, Norcross, USA may be obtained at the following address: OFS Fitel, LLC 200 Northeast Expressway Norcross, GA 30071 USA 15. Fee to auditors appointed at the general meeting Deloitte Audit fee 496496496496 16. Accounting Policies The Annual Report of OFS Fitel Denmark ApS for 2023/24 has been prepared in accordance with the provisions of the Danish Financial Statements Act applying to large enterprises of reporting class C. The Financial Statements for 2023/24 are presented in kDKK. Recognition and measurement The Financial Statements have been prepared under the historical cost method. Revenues are recognized in the income statement as earned. Furthermore, value adjustments of financial assets and liabilities measured at fair value or amortized cost are recognized. Moreover, all expenses incurred to achieve the earnings for the year are recognized in the income statement, including depreciation, amortization, impairment losses and provisions as well as reversals due to changed accounting estimates of amounts that have previously been recognized in the income statement. Assets are recognized 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 recognized 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. Certain financial assets and liabilities are measured at amortized cost, which involves the recognition of a constant effective interest rate over the maturity period. Amortized cost is calculated as original cost less any repayments and with addition/deduction of the cumulative amortization of any difference between cost and the nominal amount. In this way, capital losses and gains are allocated over the maturity period. Recognition and measurement consider predictable losses and risks occurring before the presentation of the Annual Report which confirm or invalidate affairs and conditions existing at the balance sheet date. Leases Leases is following the rules of IFRS16, and this has been changed in the financial year 2023/24. All leases have been recognized in the balance sheet with the corresponding lease liability. Leased assets are depreciated over the lease term based on the original cost e.g. no increase is made on the asset and liability amount in terms of rental cost increase. Payments are allocated between installments on the lease obligation and other leasehold costs. Translation policies Danish kroner is used as the presentation currency. All other currencies are regarded as foreign currencies. Transactions in foreign currencies are translated at the exchange rates at the dates of transaction. Exchange differences arising due to differences between the transaction date rates and the rates at the dates of payment are recognized in financial income and expenses in the income statement. Where foreign exchange transactions are considered hedging of future cash flows, the value adjustments are recognized 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 rates at the time when the receivable or the debt arose are recognized in financial income and expenses in the income statement. Fixed assets acquired in foreign currencies are measured at the transaction date rates. Hedge accounting Changes in the fair values of financial instruments that are designated and qualify as fair value hedges of a recognized asset, or a recognized liability are recognized in the income statement as are any changes in the fair value of the hedged asset or the hedged liability related to the hedged risk. instruments that are designated and qualify as hedges of expected future transactions are recognized in retained earnings under equity as regards the effective portion of the hedge. The ineffective portion is recognized in the income statement. If the hedged transaction results in an asset or a liability, the amount deferred in equity is transferred from equity and recognized in the cost of the asset or the liability, respectively. If the hedged transaction results in an income or an expense, the amount deferred in equity is transferred from equity to the income statement in the period in which the hedged transaction is recognized. The amount is recognized in the same item as the hedged transaction. Changes in the fair values of financial instruments that are designated and qualify as hedges of net investments in independent foreign subsidiaries or associates are recognized directly in equity as regards the effective portion of the hedge, whereas the ineffective portion is recognized in the income statement. Segment information on revenue Information on business segments and geographical segments based on the Company’s risks and returns and its internal financial reporting system. Business segments are regarded as the primary segments. Income Statement Revenue The revenue is following the rules of IFRS15, and this has been changed in the financial year 2023/24. Revenue from the sale of goods is recognized when the risks and rewards relating to the goods sold have been transferred to the purchaser, the revenue can be measured reliably, and it is probable that the economic benefits relating to the sale will flow to the Company. Services are recognized at the rate of completion of the service to which the contract relates by using the percentage-of-completion method, which means that revenue equals the selling price of the service completed for the year. This method is applied when total revenues and expenses in respect of the service 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. The stage of completion is determined on the basis of the ratio between the expenses incurred and the total expected expenses of the service. Revenue is measured at the consideration received and is recognized exclusive of VAT and net of discounts relating to sales. Cost of sales Cost of sales comprises costs incurred to achieve revenue for the year. Cost comprises raw materials, consumables, direct labor 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 capitalization as well as amortization of capitalised development costs. Furthermore, amortization of goodwill is included to the extent that goodwill relates to production activities. Finally, provisions for losses on contract work are recognized. Distribution expenses 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. Amortization of goodwill is also included to the extent that goodwill relates to distribution activities. Administrative expenses Administrative expenses comprise expenses for Management, administrative staff, office expenses, depreciation, etc. Amortization of goodwill is also included to the extent that goodwill relates to administrative activities. Other operating income and expenses Other operating income and other operating expenses comprise items of a secondary nature to the main activities of the Company, including gains and losses on the sale of intangible assets and property, plant and equipment. Financial income and expenses Financial income and expenses are recognized in the income statement at the amounts relating to the financial year. Tax on profit/loss for the 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 recognized in the income statement, whereas the tax attributable to equity transactions is recognized directly in equity. The Company was jointly taxed with wholly owned Danish and foreign subsidiaries. The tax effect of the joint taxation is allocated to enterprises in proportion to their taxable incomes. Balance Sheet Property, plant and equipment 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 labor, materials, components and sub-suppliers. Interest expenses on loans raised directly for financing the construction of property, plant and equipment are recognized in cost over the period of construction. All indirectly attributable borrowing expenses are recognized in the income statement. 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: Plant and machinery 3-15 years Other fixtures and fittings, tools and equipment 3-5 years Leasehold improvements 7-15 years The depreciation period and residual value are reassessed annually. Impairment of fixed assets 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 amortization and depreciation. If so, the asset is written down to its lower recoverable amount. Inventories Inventories are measured at the lower of cost under the FIFO method and net realizable value. The net realisable value of inventories is calculated at the amount expected to be generated by sale of the inventories in the process of normal operations with deduction of selling expenses. The net realizable value is determined allowing for marketability, obsolescence and development in expected selling price. 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 labor with addition of indirect production costs. Indirect production costs comprise the cost of indirect materials and labor 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 Receivables are recognized in the balance sheet at amortized cost, which substantially corresponds to nominal value. Provisions for estimated bad debts are made. Prepayments Prepayments comprise prepaid expenses concerning rent, insurance premiums, subscriptions and interest. Provisions Provisions are recognized when - in consequence of an event occurred before or on the balance sheet date - the Company has a legal or constructive obligation, and it is probable that economic benefits must be given up settling the obligation. Deferred tax assets and liabilities 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 based on the intended use of the asset and settlement of the liability, respectively. Deferred tax assets are measured at the value at which the asset is expected to be realized, 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 based on 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 crystallize as current tax. Any changes in deferred tax due to changes to tax rates are recognized in the income statement or in equity if the deferred tax relates to items recognized in equity. Current tax receivables and liabilities Current tax liabilities and receivables are recognized 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 recognized in the income statement in financial income and expenses. Financial debts Debts are measured at amortized cost, substantially corresponding to nominal value. Explanation of financial ratios Gross margin Gross profit x 100 Revenue Profit margin Profit before financials x 100 Revenue Return on assets Profit before financials x 100 Total assets Solvency ratio Equity at year end x 100 Total assets Return on equity Net profit for the year x 100 Average equity Cash flow statement With reference to section 86(4) of the Danish Financial Statements Act and to the cash flow statement included in the consolidated financial statements of Furukawa Electric Co., Ltd., Japan, the Company has not prepared a cash flow statement. Annual report Auditor's report on audited financial statements ParsePort XBRL Converter 2023-04-01 2024-03-31 2022-04-01 2023-03-31 2024-06-13 Reporting class C, large enterprise 2024-06-13 25305639 OFS Fitel Denmark ApS Priorparken 680 2605 Brøndby Opinion Basis for Opinion 2024-06-13