14125345 2024-03-01 2025-02-28 14125345 2024-03-01 2025-02-28 memberOfBoardIdentifier_executive_board_1 14125345 2024-03-01 2025-02-28 memberOfBoardIdentifier_board_of_director_1 14125345 2024-03-01 2025-02-28 memberOfBoardIdentifier_board_of_director_2 14125345 2024-03-01 2025-02-28 memberOfBoardIdentifier_board_of_director_3 14125345 2024-03-01 2025-02-28 memberOfBoardIdentifier_board_of_director_4 14125345 2024-03-01 2025-02-28 memberOfBoardIdentifier_board_of_director_5 14125345 2024-03-01 2025-02-28 memberOfBoardIdentifier_board_of_director_6 14125345 2024-03-01 2025-02-28 1 14125345 2024-03-01 2025-02-28 2 14125345 2022-03-01 2023-02-28 14125345 2021-03-01 2022-02-28 14125345 2020-03-01 2021-02-28 14125345 2023-02-28 14125345 2022-02-28 14125345 2021-02-28 14125345 2023-03-01 2024-02-29 14125345 2025-02-28 14125345 2024-02-29 14125345 2024-03-01 fsa:ContributedCapitalMember 14125345 2024-03-01 fsa:RetainedEarningsMember 14125345 2024-03-01 14125345 2024-03-01 2025-02-28 fsa:ContributedCapitalMember 14125345 2024-03-01 2025-02-28 fsa:RetainedEarningsMember 14125345 2025-02-28 fsa:ContributedCapitalMember 14125345 2025-02-28 fsa:RetainedEarningsMember 14125345 2024-03-01 fsa:CompletedDevelopmentProjectsMember 14125345 2024-03-01 fsa:GoodwillMember 14125345 2025-02-28 fsa:CompletedDevelopmentProjectsMember 14125345 2025-02-28 fsa:GoodwillMember 14125345 2024-03-01 2025-02-28 fsa:CompletedDevelopmentProjectsMember 14125345 2024-03-01 2025-02-28 fsa:GoodwillMember 14125345 2024-03-01 fsa:LandAndBuildingsMember 14125345 2024-03-01 fsa:PlantAndMachineryMember 14125345 2024-03-01 fsa:FixturesFittingsToolsAndEquipmentMember 14125345 2024-03-01 fsa:LeaseholdImprovementsMember 14125345 2024-03-01 2025-02-28 fsa:LandAndBuildingsMember 14125345 2024-03-01 2025-02-28 fsa:PlantAndMachineryMember 14125345 2024-03-01 2025-02-28 fsa:FixturesFittingsToolsAndEquipmentMember 14125345 2024-03-01 2025-02-28 fsa:LeaseholdImprovementsMember 14125345 2025-02-28 fsa:LandAndBuildingsMember 14125345 2025-02-28 fsa:PlantAndMachineryMember 14125345 2025-02-28 fsa:FixturesFittingsToolsAndEquipmentMember 14125345 2025-02-28 fsa:LeaseholdImprovementsMember 14125345 2024-03-01 fsa:InvestmentsInGroupEnterprisesMember 14125345 2023-03-01 fsa:InvestmentsInGroupEnterprisesMember 14125345 2025-02-28 fsa:InvestmentsInGroupEnterprisesMember 14125345 2024-02-29 fsa:InvestmentsInGroupEnterprisesMember 14125345 2024-03-01 2025-02-28 fsa:InvestmentsInGroupEnterprisesMember 14125345 2023-03-01 2024-02-29 fsa:InvestmentsInGroupEnterprisesMember 14125345 2024-03-01 2025-02-28 relatedEntityIdentifier_sub_1 fsa:SubsidiaryMember 14125345 2025-02-28 relatedEntityIdentifier_sub_1 fsa:SubsidiaryMember 14125345 2024-03-01 2025-02-28 relatedEntityIdentifier_sub_2 fsa:SubsidiaryMember 14125345 2025-02-28 relatedEntityIdentifier_sub_2 fsa:SubsidiaryMember 14125345 2024-03-01 2025-02-28 relatedEntityIdentifier_sub_3 fsa:SubsidiaryMember 14125345 2025-02-28 relatedEntityIdentifier_sub_3 fsa:SubsidiaryMember 14125345 2024-03-01 2025-02-28 relatedEntityIdentifier_sub_4 fsa:SubsidiaryMember 14125345 2025-02-28 relatedEntityIdentifier_sub_4 fsa:SubsidiaryMember 14125345 2024-03-01 2025-02-28 relatedEntityIdentifier_sub_5 fsa:SubsidiaryMember 14125345 2025-02-28 relatedEntityIdentifier_sub_5 fsa:SubsidiaryMember 14125345 2024-03-01 fsa:DepositsLongtermInvestmentsAndReceivablesMember 14125345 2024-03-01 2025-02-28 fsa:DepositsLongtermInvestmentsAndReceivablesMember 14125345 2025-02-28 fsa:DepositsLongtermInvestmentsAndReceivablesMember 14125345 2025-02-28 fsa:OtherLongtermPayablesMember 14125345 2024-02-29 fsa:OtherLongtermPayablesMember 14125345 2025-02-28 fsa:OtherShorttermPayablesMember 14125345 2024-02-29 fsa:OtherShorttermPayablesMember iso4217:DKK pure xbrli:pure Årsrapport 33771231 PricewaterhouseCoopers Statsautoriseret Revisionspartnerselskab Strandvejen 44 2900 Hellerup 2024-03-01 2023-03-01 2025-02-28 2024-02-29 Regnskabsklasse C, mellemstor virksomhed Revisionspåtegning true 2025-05-20 Kristian la Cour The Executive Board and Board of Directors have today considered and adopted the Annual Report of EPOKE A/S for the financial year 1 March 2024 - 28 February 2025. 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 28 February 2025 of the Company and of the results of the Company operations for 2024/25. We recommend that the Annual Report be adopted at the Annual General Meeting. Vejen 2025-05-20 Peter Bjørn Bertelsen Executive Officer Carsten Bjerg Thomas Marstrand Johanne Christiane Frazer Riegels Østergård Chairman Vice chairman Kristian la Cour Dan Johannsen Gert Kristensen To the shareholder of EPOKE A/S Opinion In our opinion, the Financial Statements give a true and fair view of the financial position of the Company at 28 February 2025 and of the results of the Company´s operations for the financial year 1 March 2024 - 28 February 2025 in accordance with the Danish Financial Statements Act.We have audited the Financial Statements of EPOKE A/S for the financial year 1 March 2024 - 28 February 2025, which comprise income statement, balance sheet, statement of changes in equity and notes, including a summary of significant accounting policies (”the Financial Statements”). Basis for Opinion We conducted our audit in accordance with International Standards on Auditing (ISAs) and the additional requirements applicable in Denmark. Our responsibilities under those standards and requirements are further described in the ”Auditor’s responsibilities for the audit of the Financial Statements” section of our report. We are independent of the Company in accordance with the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (IESBA Code) and the additional ethical requirements applicable in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Management is responsible for Management’s Review.Our opinion on the Financial Statements does not cover Management’s Review, and we do not express any form of assurance conclusion thereon.In connection with our audit of the Financial Statements, our responsibility is to read Management’s Review and, in doing so, consider whether Management’s Review is materially inconsistent with the Financial Statements or our knowledge obtained during the audit, or otherwise appears to be materially misstated.Moreover, it is our responsibility to consider whether Management’s Review provides the information required under the Danish Financial Statements Act.Based on the work we have performed, in our view, Management’s Review 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 in Management’s Review. Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the Danish Financial Statements Act, and for such internal control as Management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.In preparing the Financial Statements, Management is responsible for assessing the Company´s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting in preparing the Financial Statements unless Management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so. Our objectives are to obtain reasonable assurance about whether the Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Financial Statements.As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we exercise professional 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 Company´s internal control.Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management.Conclude on the appropriateness of Management’s use of the going concern basis of accounting in preparing the Financial Statements and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company´s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the Financial Statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.Evaluate the overall presentation, structure and contents of the Financial Statements, including the disclosures, and whether the Financial Statements represent the underlying transactions and events in a manner that gives a true and fair view.Plan and perform the audit to obtain sufficient appropriate audit evidence regarding the consolidated financial information of the entities or business units as a basis for forming an opinion on the Financial Statements. We are responsible for the direction, supervision and review of the audit work performed. We remain solely responsible for our audit opinion.We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Odense 2025-05-20 PricewaterhouseCoopersStatsautoriseret Revisionspartnerselskab 33771231 Henrik Forthoft Lind Brian Petersen State Authorised Public Accountant State Authorised Public Accountant mne34169 mne33722 EPOKE A/S Vejenvej 50 6600 Vejen 14125345 Vejen Herredsvej 32 7100 Vejle Seen over a 5-year period, the development of the Company is described by the following financial highlights:In connection with changes to accounting policies, the comparative figures for 2020/21, 2021/22 and 2022/23 have not been restated. See the description under accounting policies.Financial highlights are defined and calculated in accordance with the current version of "Recommendations & Ratios" issued by the CFA Society Denmark. 207791000 198845000 198761000 83491000 77160000 77492000 22149000 12349000 11165000 -1913000 -2670000 -1844000 18252000 7268000 7068000 159290000 139554000 181295000 112000 623000 449000 0 1706000 90757000 73134000 110103000 101 106 114 135 131 0.431 0.433 0.402 0.388 0.390 0.144 0.169 0.107 0.062 0.056 0.166 0.219 0.139 0.088 0.062 0.659 0.642 0.570 0.524 0.607 0.248 0.353 0.223 0.079 0.066 Key activitiesThe primary activities of Epoke A/S is to develop, manufacture, market and sell Epoke and Snowline machinery. Epoke A/S products are sold through own companies in Denmark and Germany. Sales and marketing in other markets are based on partnerships with dealers based in the respective countries. Focusing on the customer and in co-operation with dealers, Epoke A/S markets Epoke winter road maintenance products together with Snowline snow removal equipment. Epoke A/S aims to become the industry’s best-known brand and to be a market leader in selected segments. Epoke A/S develops and manufactures state-of-the-art salt and liquid spreaders together with Snowline snow removal equipment that meet the customers' requirements in terms of service, quality and economic life costs.Development in the yearThe income statement of the Company for 2024/25 shows a profit of TDKK 28,440, and at 28 February 2025 the balance sheet of the Company shows a positive equity of TDKK 119,729.The past year and follow-up on development expectations from last yearManagement expectations in the last annual report was earnings before interest, tax, depreciation and amortization (EBITDA) between TDKK 30,000 and TDKK 35,000. Earnings before interest, tax, depreciation and amortization (EBITDA) was realised at TDKK 32,187 in 2024/25.Targets and expectations for the year aheadManagement expects earnings before interest, tax, depreciation and amortization (EBITDA) to be DKK 35,000-45,000k.Research and developmentEpoke A/S is among the absolute market leaders when it comes to spreaders for winter road clearance. Epoke A/S has won this position through persistent and targeted development efforts as regards spreaders and related electronic products. Epoke A/S protects its development projects by taking out patents, if appropriate. Epoke A/S intends to sustain its position by continuously adding the resources required and staying focused on road clearance. The product portfolio is characterized by high performance, low service costs, high quality of products and in particular innovative solutions.External environmentEpoke A/S holds a clean environment approval and is ISO 14001 certified. Epoke A/S is compliant with applicable environmental law etc. and has not received any complaints or claims relating to non-compliance with environmental rules on the part of its foreign subsidiary.Intellectual capital resourcesEpoke A/S aims to be an attractive workplace with motivated and committed staff. To ensure continued motivation and strong commitment on the part of staff, work at Epoke A/S is performed based on corporate values enabling the individual staff member to make his or her own decisions. The management philosophy is freedom with responsibility. Epoke A/S has formulated a senior policy and is locally known for its efforts to retain senior staff as well as other social activities.Uncertainty relating to recognition and measurementThere has been no uncertainty regarding recognition and measurement in the Annual Report.Unusual eventsThe financial position at 28 February 2025 of the Company and the results of the activities and cash flows of the Company for the financial year for 2024/25 have not been affected by any unusual events.Subsequent eventsNo events materially affecting the assessment of the Annual Report have occurred after the balance sheet date. 90631000 95745000 58444000 55736000 2006000 2690000 30181000 37319000 3872000 7252000 1238000 1194000 1393000 2108000 33898000 43657000 5458000 8368000 28440000 35289000 0 0 84000 334000 84000 334000 2301000 2870000 971000 1776000 110000 380000 0 0 3382000 5026000 9106000 7756000 37000 61000 9143000 7817000 12609000 13177000 33613000 32608000 16091000 17186000 17943000 20525000 67647000 70319000 28115000 24014000 24564000 22447000 1234000 775000 1648000 0 1125000 2076000 56686000 49312000 44870000 37324000 169203000 156955000 181812000 170132000 15000000 15000000 104729000 94289000 119729000 109289000 2136000 2551000 2136000 2551000 6209000 6129000 6209000 6129000 0 547000 15011000 17008000 23489000 17222000 7106000 8674000 8132000 8712000 53738000 52163000 59947000 58292000 181812000 170132000 15000000 97794000 112794000 0 -3505000 -3505000 15,00094,289109,289119,729 0 18000000 18000000 0 28440000 28440000 15000000 104729000 52759000 50191000 4894000 4740000 791000 805000 58444000 55736000 1744000 1860000 101 106 250000 250000 1756000 2440000 2006000 2690000 402000 330000 836000 864000 1238000 1194000 633000 594000 760000 1514000 1393000 2108000 7106000 8368000 -1648000 0 5458000 8368000 18000000 13250000 10440000 22039000 759000 2400000 759000 2400000 759000 2066000 0 250000 759000 2316000 0 84000 33666000 41177000 11883000 83000 0 112000 0 0 33666000 41289000 11883000 83000 30796000 39401000 11503000 83000 569000 917000 270000 0 31365000 40318000 11773000 83000 2301000 971000 110000 0 27688000 27688000 27688000 27688000 -22462000 -30790000 0 1000 3872000 6968000 2644000 0 0 546000 -1000 829000 0 1076000 -21235000 -22462000 2653000 2530000 9106000 7756000 Investments in subsidiaries are specified as follows:**Prepayments**Prepayments consist of prepaid expenses concerning rent, insurance premiums, subscriptions and interest as well. Alfred Thomsen GmbH Eichenzell, Germany 1.00 Epoke Machinenbau GmbH & Co. KG Eichenzell, Germany 1.00 Epoke Sp. z.o.o. Warzawa, Poland 1.00 Brodd Sweden AB Sweden 1.00 Brodd Polonia Sp. z.o.o. Poland 1.00 61000 24000 37000 37000 Amounts recognised in the income statement for the year1,6480Deferred tax asset at 28 February1,6480 Prepayments consist of prepaid expenses concerning rent, insurance premiums, subscriptions and interest as well. Provision for service liability1,0801,252Provision for warranties1,0561,144Other provisions01552,1362,551The provisions are expected to mature as follows:Provisions falling due after 5 years0000 Payments due within 1 year are recognised in short-term debt. Other debt is recognised in long-term debt.The debt falls due for payment as specified below:Other payables14,34114,841 0 0 6209000 6129000 6209000 6129000 8132000 8712000 Charges and securityThe following assets have been placed as security with bankers:Mortgage deeds registered to the mortgagor totalling kDKK 38,000, providing security on land and buildings as well as other property, plant and equipment at a total carrying amount of:2,8703,722Floating charge registered to the bank totalling kDKK 30,000, providing security on inventory, trade receivables, other receivables, as well as plant and equipment at a total carrying amount of96,22798,965 Other contingent liabilitiesThe group companies are jointly and severally liable for tax on the jointly taxed incomes etc of the Group. The total amount of corporation tax payable is disclosed in the Annual Report of Epoke Investment III A/S, which is the management company of the joint taxation purposes. Moreover, the group companies are 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 withholding taxes may increase the Company's liability.The company has issued a letter of support to its sister company, Ejendomsselskabet Skibelund ApS. The equity in Ejendomsselskabet Skibelund ApS of DKK 2,579kThe Company has provided a suretyship for the parent company's obligations to the bank. Controlling interestEpoke Investment II A/SParentEpoke Investment III A/SUltimate ParentTransactionsThe Company has chosen only to disclose transactions which have not been made on an arm's length basis in accordance with section 98(c)(6) of the Danish Financial Statements Act.No such transactions were conducted during the financial year. Consolidated Financial StatementsThe Company is included in the group report for the Parent CompanyEpoke Investment III A/S No events materially affecting the assessment of the Annual Report have occurred after the balance sheet date. The Annual Report of EPOKE A/S for 2024/25 has been prepared in accordance with the provisions of the Danish Financial Statements Act applying to medium-sized enterprises of reporting class C.The accounting policies applied remain unchanged from last year.The Financial Statements for 2024/25 are presented in TDKK. The company has identified an error in the opening equity of DKK 3,505k and has chosen to correct the comparative figures accordingly. The correction has not affected the results for the current year or the previous year, but only the equity and investments in subsidiaries. The total effect on investments in subsidiaries and assets is a decrease of DKK 3,505k for the previous year and no effect for the current year. For equity, the effect has been a decrease of DKK 3,505k for the previous year and no effect for the current year With reference to section 112 of the Danish Financial Statements Act and to the consolidated financial statements for 2024/25 of Epoke Investment III A/S, the Company has not prepared consolidated financial statements. 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 Epoke Investment III A/S, the Company has not prepared a cash flow statement. Recognition and measurementRevenues 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. All leases are considered operating leases. Payments made under operating leases are recognised in the income statement on a straight-line basis over the lease term. Translation policiesTransactions 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 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 rates at the time when the receivable or the debt arose are recognised in financial income and expenses in the income statement.Fixed assets acquired in foreign currencies are measured at the transaction date rates. RevenueRevenue from the sale of goods is recognised 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 recognised 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 recognised exclusive of VAT and net of discounts relating to sales. Expenses for raw materials and consumablesExpenses for raw materials and consumables comprise the raw materials and consumables consumed to achieve revenue for the year. Other external expensesOther external expenses comprise indirect production costs and expenses for premises, sales and distribution as well as office expenses, etc. Gross profitWith reference to section 32 of the Danish Financial Statements Act, gross profit/loss is calculated as a summary of revenue, expenses for raw materials and consumables and other external expenses. Staff expenses comprise wages and salaries as well as payroll expenses. Amortisation, depreciation and impairment lossesAmortisation, depreciation and impairment losses comprise amortisation, depreciation and impairment of intangible assets and property, plant and equipment. Other operating income and expensesOther 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. Income from investments in subsidiariesThe item “Income from investments in subsidiaries” in the income statement includes the proportionate share of the profit for the year. Financial income and expenses are recognised in the income statement at the amounts relating to the financial year. Tax on profit/loss for the yearTax 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 the Danish Group Companies. The tax effect of the joint taxation is allocated to Danish enterprises in proportion to their taxable incomes. Intangible fixed assetsGoodwill acquired is measured at cost less accumulated amortisation. Goodwill is amortised on a straight-line basis over its useful life, which is assessed at 5 year. Goodwill is amortized over the estimated economic life, which is determined based on management's experience within the individual business areas. The amortization period is set based on the expected payback period and the strategic positions of the acquired companies, considering their market position and long-term earnings profile.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. Interest expenses on loans raised directly for financing the construction of property, plant and equipment are recognised in cost over the period of construction.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:Production buildings7-33 years Plant and machinery3-10 years Other fixtures and fittings, tools and equipment3-5 years Leasehold improvements7 years The fixed assets’ residual values are determined at nil.Depreciation period and residual value are reassessed annually. Impairment of fixed assetsThe carrying amounts of intangible assets and property, plant and equipment and investments 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. Investments in subsidiariesInvestments in subsidiaries are recognised and measured under the equity method.The item “Investments in subsidiaries” in the balance sheet include the proportionate ownership share of the net asset value of the enterprises calculated on the basis of the fair values of identifiable net assets at the time of acquisition with deduction or addition of unrealised intercompany profits or losses and with addition of the remaining value of any increases in value and goodwill calculated at the time of acquisition of the enterprises.The total net revaluation of investments in subsidiaries is transferred upon distribution of profit to “Reserve for net revaluation under the equity method“ under equity. The reserve is reduced by dividend distributed to the Parent Company and adjusted for other equity movements in the subsidiaries.Subsidiaries with a negative net asset value are recognised at DKK 0. Any legal or constructive obligation of the Parent Company to cover the negative balance of the enterprise is recognised in provisions. Other fixed asset investments consist of deposits. InventoriesInventories 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 of the inventories 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 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 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. PrepaymentsPrepayments comprise prepaid expenses concerning rent, insurance premiums, subscriptions and interest. *Dividend*Dividend distribution proposed by Management for the year is disclosed as a separate equity item ProvisionsProvisions are recognised 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 to settle the obligation.Other provisions include warranty obligations in respect of repair work within the warranty period of 1-3 years. Provisions are measured and recognised based on experience with guarantee work. Deferred tax assets and liabilitiesDeferred 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 or in equity if the deferred tax relates to items recognised in equity. Current tax receivables and liabilitiesCurrent 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. Loans are recognised initially at the proceeds received net of transaction expenses incurred. Subsequently, the loans are measured at amortised cost; the difference between the proceeds and the nominal value is recognised as an interest expense in the income statement over the loan period.Other debts are measured at amortised cost, substantially corresponding to nominal value. Financial HighlightsExplanation of financial ratiosReturn on assetsProfit/loss of primary operations x 100 / Total assets at year endSolvency ratioEquity at year end x 100 / Total assets at year endReturn on equityNet profit for the year x 100 / Average equity