Årsrapport 30700228 EY Godkendt Revisionspartnerselskab Cortex Park Vest 3 5230 Odense M 2021-01-01 2021-12-31 2020-01-01 2020-12-31 28310064 TEN CATE ADVANCED ARMOUR DANMARK A/S Damsbovej 10 5492 Vissenbjerg 2004-12-28 Assens EY Godkendt Revisionspartnerselskab 30700228 Cortex Park Vest 3 5230 Odense M 2022-06-28 Helle Specht Regnskabsklasse C, mellemstor virksomhed Revisionspåtegning Grundlag for konklusion Konklusion 2022-06-28 2022-06-28 CaseWare Working Papers Vissenbjerg Helle Specht Steen Tanderup Chair Wilfred Sluijter Helle Specht Odense Morten Schougaard Sørensen State Authorised Public Accountant mne32129 12404741 11283711 7278032 6306893 5395460 2022363 -576269 -349379 -79818 3937 53947 4855110 4211737 1533996 17329666 11323341 7987289 195328 146366 638545 560631 242858 12845968 7997197 3804829 18.8 18 44 55.9 30.6 66.5 62.7 74.1 70.6 47.6 19.8 19.8 46.6 71.4 50.5 64 66 48 10137531 8938661 1253669 946597 4329883 4023984 4553979 3968080 576269 349379 3977710 3618701 881878 796228 3095832 2822473 21510 1585 21510 1585 4375502 4428557 1237063 1421882 0 0 124293 0 5736858 5850439 5758368 5852024 1026456 1451359 212930 382370 208 286956 1239594 2120685 2320988 2978924 10268332 11643466 519143 588170 78677 261242 13187140 15471802 3280510 1657077 17707244 19249564 23465612 25101588 134000 134000 15472996 12371658 0 3226670 15606996 15732328 90232 43681 90232 43681 4129094 4271829 4129094 4271829 142735 128944 1913811 2425607 0 830289 399353 0 1183391 1668910 3639290 5053750 7768384 9325579 23465612 25101588 134000 12711968 0 0 5248 0 -404197 3226670 0 -58639 0 134000 12371658 3226670 3095832 0 0 -5506 0 0 3226670 134000 15472996 0 835344 867713 46534 -71485 881878 796228 348768 131 68000 416899 347183 131 48075 395389 21510 4570917 3530619 28138 0 0 1330 11 0 46258 24777 0 124293 0 3861 0 0 4617175 3552865 28149 124293 142360 2108737 28138 0 0 794 11 0 99313 210132 0 0 0 3861 0 0 241673 2315802 28149 0 4375502 1237063 0 124293 37569 113372 90232 43681 4271829 142735 4129094 0 3537327 3490324 272600 284539 65508 80356 3875435 3855219 47 52 0 3226670 3095832 -404197 Today, the Board of Directors and the Executive Board have discussed and approved the annual report of TEN CATE ADVANCED ARMOUR DANMARK A/S for the financial year 1 January - 31 December 2021. 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 of the Company at 31 December 2021 and of the results of the Company's operations for the financial year 1 January - 31 December 2021. Further, in our opinion, the Management's review gives a fair review of the development in the Company's operations and financial matters and the results of the Company's operations and financial position. We recommend that the annual report be approved at the annual general meeting. To the shareholder of TEN CATE ADVANCED ARMOUR DANMARK A/S We have audited the financial statements of TEN CATE ADVANCED ARMOUR DANMARK A/S for the financial year 1 January - 31 December 2021, which comprise income statement, balance sheet, statement of changes in equity and notes, including 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 financial position of the Company at 31 December 2021 and of the results of the Company's operations for the financial year 1 January - 31 December 2021 in accordance with the Danish Financial Statements Act. 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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence We are independent of the Company in accordance with the International Ethics Standards Board for Accountants' 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. 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 as to 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 the 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 note disclosures, 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's review. Our opinion on the financial statements does not cover the 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's review and, in doing so, consider whether the 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 the Management's review provides the information required under the Danish Financial Statements Act. Based on the work we have performed, we conclude that the Management's review is in accordance with the financial statements and has been prepared in accordance with the requirements of the Danish Financial Statement Act. We did not identify any material misstatement of the Management's review. For terms and definitions, please see the accounting policies. TenCate Advanced Armour Danmark A/S designs, develops and manufactures lightweight survivability solutions for personnel, land vehicles, naval vessels, aircraft, structures and fixed installations for the Danish, European and Asian markets. During the year, it was established that the company has a lease contract on factory premises with terms that defines it as a financial lease contract within the scope of financial lease obligations that needs to be accounted for as a lease obligation and a corresponding asset in accordance with the Danish Financial Statement Act. The lease contract has by mistake previously been recognized as an operational lease contract. Reference is made to note 1 about the impact on the annual report and comparative figures of the correction of the mistake. The income statement for 2021 shows a profit of EUR 3,095,832 against a profit of EUR 2,822,473 last year, and the balance sheet at 31 December 2021 shows equity of EUR 15,606,996. The profit is in line with the expectations. Research and development activities have been strengthened with new team member adding new skillsets. Events after the balance sheet date. No events materially affecting the Company's financial position have occurred subsequent to the financial year-end. No events materially affecting the Company's financial position have occurred subsequent to the financial year-end. The Company’s revenue for 2022 is expected to increase by approx. 15% due to the continued growth in the Company’s core markets in Northern Europe. Further, profit is expected to increase but in a modest way due to TenCate enhancing capabilities and skillset. The annual report of TEN CATE ADVANCED ARMOUR DANMARK A/S for 2021 has been prepared in accordance with the provisions in the Danish Financial Statements Act applying to medium-sized reporting class C entities. During the year, it was established that the company has a lease contract on factory premises with terms that defines it as a financial lease contract within the scope of financial lease obligations that needs to be accounted for as a lease obligation and a corresponding asset in accordance with the Danish Financial Statement Act. The lease contract has by mistake previously been recognised as an operational lease contract. The company has made a full adjustment of comparative figures so that the accounts are presented as if the correct recognition had been valid for the entire period. This has had the following effect on the accounts Opening balance 2020 As a consequence of the material error assets in the form of the company's property has been increased by 4,523 tEUR and interest-bearing debt is increased by 4,517 tEUR. The change has lead to an increase in equity of 5 tEUR and an increase in deferred tax of 1 tEUR on 1 January 2020. Impact 2020 As a consequence of the material error assets in the form of the company's property are underestimated by 4,429 tEUR and interest-bearing debt is underestimated by 4,401 tEUR, equity is underestimated by 22 tEUR and deferred tax is underestimated by 6 tEUR in 2020. Further, profit before tax for the year is underestimated by 21 tEUR and profit after tax by 16 tEUR. Finally, there have been some reclassifications between the items in the profit and loss statement, so that interest expenses have increased by 227 tEUR, depreciations have increased by 95 tEUR and administrative expenses has decreased by 343 tEUR. With reference to section 86(4) of the Danish Financial Statements Act, no cash flow statement has been prepared. The Company's cash flows are reflected in the consolidated cash flow statement for the higher-ranking parent company XX. Reporting currency The financial statements are presented in euros (EUR), as the Company's most significant transactions are settled in EUR. On initial recognition, derivative financial instruments are recognised at cost in the balance sheet and are subsequently measured at fair value. Positive and negative fair values of derivative financial instruments are presented as separate items in the balance sheet. The Company has chosen IAS 11/IAS 18 as interpretation for revenue recognition. Income from the sale of goods for resale and finished goods is recognised in revenue when the most significant rewards and risks have been transferred to the buyer and provided the income can be measured reliably and payment is expected to be received. The items revenue, production costs and other operating income have been aggregated into one item in the income statement called gross profit in accordance with section 32 of the Danish Financial Statements Act. Production costs comprise costs incurred in generating the revenue for the year. Such costs include direct and indirect costs of raw materials, consumables and production staff, rent and leases, as well as depreciation on production plant. Production costs also comprise research and development costs that do not qualify for capitalisation and amortisation of capitalised development costs. Also, provision for losses on construction contracts is recognised. Distribution costs comprise costs related to the distribution of goods sold in the year and to sales campaigns, etc. carried out in the year, including costs related to sales staff, advertising, exhibitions and amortisation/depreciation. Sales and marketing costs are recognised in the income statement when the Company obtains control of the sales or marketing product. Administrative expenses include expenses incurred in the year for company management and administration, including expenses relating to administrative staff, Management, office premises and expenses as well as amortisation/depreciation of assets used for administrative purposes. Staff costs include wages and salaries, including compensated absence and pension to the Company's employees, as well as other social security contributions, etc. The item is net of refunds from public authorities. Financial expenses are recognised in the income statements at the amounts that concern the financial year. Net financials include interest expenses as well as allowances and surcharges under the advance-payment-of-tax scheme, etc. Tax for the year includes current tax on the year's expected taxable income and the year's deferred tax adjustments. The portion of the tax for the year that relates to the profit/loss for the year is recognised in the income statement, whereas the portion that relates to transactions taken to equity is recognised in equity. The entity is jointly taxed with other group entities. The total Danish income tax charge is allocated between profit/loss-making Danish entities in proportion to their taxable income (full absorption). Jointly taxed entities entitled to a tax refund are reimbursed by the management company based on the rates applicable to interest allowances, and jointly taxed entities which have paid too little tax pay a surcharge according to the rates applicable to interest surcharges to the management company. Other intangible assets include development projects and other acquired intangible rights, including software licences, distribution rights and development projects. Other intangible assets are measured at cost less accumulated amortisation and impairment losses. Property, plant and equipment Items of property, plant and equipment are measured at cost less accumulated depreciation and impairment losses. Cost includes the acquisition price and costs directly related to the acquisition until the time at which the asset is ready for use. The Company has chosen IAS 17 as interpretation for classification and recognition of leases. Leases that do not transfer substantially all the risks and rewards incident to the ownership to the Company are classified as operating leases. Payments relating to operating leases and any other rent agreements are recognised in the income statement over the term of the lease. The Company's aggregate liabilities relating to operating leases and other rent agreements are disclosed under "Contingent liabilities". Securities which the Company intends to hold to maturity are measured at amortised cost, using the effective interest rate method at the date of acquisition. Value adjustments are recognised in the income statement under "Net financials". Securities and investments consisting of listed shares and bonds are measured at fair value (market price) at the balance sheet date. Investments not admitted to trading on an active market are measured at cost. The carrying amount of intangible assets, property, plant and equipment and investments in subsidiaries and associates is assessed for impairment on an annual basis. Impairment tests are conducted on assets or groups of assets when there is evidence of impairment. The carrying amount of impaired assets is reduced to the higher of the net selling price and the value in use (recoverable amount). The recoverable amount is the higher of the net selling price of an asset and its value in use. The value in use is calculated as the present value of the expected net cash flows from the use of the asset or the group of assets and the expected net cash flows from the disposal of the asset or the group of assets after the end of the useful life. Previously recognised impairment losses are reversed when the reason for recognition no longer exists. Impairment losses on goodwill are not reversed. Receivables are measured at amortised cost. The Company has chosen IAS 39 as interpretation for impairment of financial receivables. An impairment loss is recognised if there is objective evidence that a receivable or a group of receivables is impaired. If there is objective evidence that an individual receivable has been impaired, an impairment loss is recognised on an individual basis. Receivables in respect of which there is no objective evidence of individual impairment are tested for objective evidence of impairment on a portfolio basis. The portfolios are primarily based on the debtors' domicile and credit ratings in line with the Company's risk management policy. The objective evidence applied to portfolios is determined based on historical loss experience. Impairment losses are calculated as the difference between the carrying amount of the receivables and the present value of the expected cash flows, including the realisable value of any collateral received. The effective interest rate for the individual receivable or portfolio is used as discount rate. Prepayments recognised under "Assets" comprise prepaid expenses regarding subsequent financial reporting years. Proposed dividends Dividend proposed for the year is recognised as a liability once adopted at the annual general meeting (declaration date). Dividends expected to be distributed for the financial year are presented as a separate item under "Equity". Dividend proposed for the year is recognised as a liability once adopted at the annual general meeting (declaration date). Dividends expected to be distributed for the financial year are presented as a separate item under "Equity". Financial liabilities are recognised at the date of borrowing at the net proceeds received less transaction costs paid. On subsequent recognition, financial liabilities are measured at amortised cost, corresponding to the capitalised value, using the effective interest rate. Accordingly, the difference between the proceeds and the nominal value is recognised in the income statement over the term of the loan. Financial liabilities also include the capitalised residual lease liability in respect of finance leases. Other liabilities are measured at net realisable value. Deferred income Deferred income recognised as a liability comprises payments received concerning income in subsequent financial reporting years. The financial ratios stated under "Financial highlights" have been calculated as follows: Operating profit/loss Profit/loss before financial items adjusted for other operating income and other operating expenses Return on assets Profit/loss from operating activites x 100 Average assets Equity ratio Equity, year-end x 100 Total equity and liabilities, year-end Return on equity Profit/loss after tax x 100 Average equity Prepayments comprise prepaid operating costs. Prepayments are measured at cost. The Company's share capital has remained EUR 134,000 in the past year. Contributed capital consists of 1,000 shares of a value of DKK 1,000 each. No shares carry special rights. By reference to section 98b(3), (ii), of the Danish Financial Statements Act, remuneration to Management is not disclosed. The Company is jointly taxed with its parent, Ten Cate DAnmark A/S, which acts as management company, and is jointly and severally liable with other jointly taxed group entities for payment of income taxes as well as withholding taxes on interest, royalties and dividends falling due for payment. Other lease liabilities: EUR 2021 2020 Lease liabilities 53,023 90,718 Lease liabilities include operating leases for, totalling DKK 53,023, with remaining contract terms of 1-4 years. The Company has entered into foreign exchange forward and swap contracts to hedge currency risks on operational order and balance sheet positions in GBP and USD. Operational order and balance sheet positions in EUR are not hedged due to a floating peg against DKK. The total market value of the outstanding foreign exchange derivatives at 31 December 2021 represented a negative of EUR 97 thousand. Parties exercising control Related party Domicile Basis for control Ten Cate Danmark A/S Vissenbjerg, Denmark Shareholder (Parent company) Protego Topco B.V. Netherlands Shareholder (Ultimative parent Company) Information about consolidated financial statements Parent Domicile Requisitioning of the parent company's consolidated financial statements Protego Topco B.V. Netherlands CVR Related party transactions TEN CATE ADVANCED ARMOUR DANMARK A/S was engaged in the below related party transactions: EUR 2021 2020 Revenue from group entites 6,683,290 3,853,305 Purchase from group entites 1,771,276 1,521,080 Receivables and payables to group entities are disclosed in the balance sheet 28310064 2021-01-01 2021-12-31 28310064 2021-01-01 28310064 2020-12-31 28310064 2021-12-31 28310064 2020-01-01 28310064 2021-01-01 2021-12-31 1 28310064 2021-01-01 2021-12-31 2 28310064 2021-01-01 2021-12-31 3 28310064 2021-01-01 2021-12-31 1 28310064 2021-01-01 2021-12-31 1 28310064 2021-01-01 e:AcquiredIntangibleAssetsMember 28310064 2021-01-01 2021-12-31 e:AcquiredIntangibleAssetsMember 28310064 2021-12-31 e:AcquiredIntangibleAssetsMember 28310064 2021-01-01 2021-12-31 e:ProposedDividendRecognisedInEquityMember 28310064 2020-01-01 2020-12-31 e:ProposedDividendRecognisedInEquityMember 28310064 2021-01-01 2021-12-31 e:RetainedEarningsMember 28310064 2020-01-01 2020-12-31 e:RetainedEarningsMember 28310064 2021-01-01 e:LandAndBuildingsMember 28310064 2021-01-01 2021-12-31 e:LandAndBuildingsMember 28310064 2021-12-31 e:LandAndBuildingsMember 28310064 2021-01-01 e:PlantAndMachineryMember 28310064 2021-01-01 2021-12-31 e:PlantAndMachineryMember 28310064 2021-12-31 e:PlantAndMachineryMember 28310064 2021-01-01 e:FixturesFittingsToolsAndEquipmentMember 28310064 2021-01-01 2021-12-31 e:FixturesFittingsToolsAndEquipmentMember 28310064 2021-12-31 e:FixturesFittingsToolsAndEquipmentMember 28310064 2021-01-01 e:PropertyPlantAndEquipmentInProgressMember 28310064 2021-01-01 2021-12-31 e:PropertyPlantAndEquipmentInProgressMember 28310064 2021-12-31 e:PropertyPlantAndEquipmentInProgressMember 28310064 2020-01-01 e:ContributedCapitalMember 28310064 2020-01-01 2020-12-31 e:ContributedCapitalMember 28310064 2021-01-01 e:ContributedCapitalMember 28310064 2021-01-01 2021-12-31 e:ContributedCapitalMember 28310064 2021-12-31 e:ContributedCapitalMember 28310064 2021-01-01 e:RetainedEarningsMember 28310064 2021-01-01 2021-12-31 e:RetainedEarningsMember 28310064 2021-12-31 e:RetainedEarningsMember 28310064 2020-01-01 e:RetainedEarningsMember 28310064 2020-01-01 2020-12-31 e:RetainedEarningsMember 28310064 2021-01-01 e:ProposedDividendRecognisedInEquityMember 28310064 2021-01-01 2021-12-31 e:ProposedDividendRecognisedInEquityMember 28310064 2021-12-31 e:ProposedDividendRecognisedInEquityMember 28310064 2020-01-01 e:ProposedDividendRecognisedInEquityMember 28310064 2020-01-01 2020-12-31 e:ProposedDividendRecognisedInEquityMember 28310064 2020-01-01 2020-12-31 28310064 2021-01-01 2021-12-31 d:TwoYearsAgoMember 28310064 2021-12-31 d:TwoYearsAgoMember 28310064 2021-01-01 2021-12-31 d:ThreeYearsAgoMember 28310064 2021-12-31 d:ThreeYearsAgoMember 28310064 2021-01-01 2021-12-31 d:FourYearsAgoMember 28310064 2021-12-31 d:FourYearsAgoMember 28310064 2021-12-31 e:LongtermLeaseCommitmentsMember iso4217:EUR xbrli:pure