25013719 2022-01-01 2022-12-31 25013719 2022-01-01 2022-12-31 1 25013719 2022-01-01 2022-12-31 2 25013719 2022-12-31 25013719 2021-01-01 2021-12-31 25013719 2021-12-31 25013719 2020-01-01 2020-12-31 25013719 2020-12-31 25013719 2019-01-01 2019-12-31 25013719 2019-12-31 25013719 2018-01-01 2018-12-31 25013719 2018-12-31 25013719 2020-12-31 fsa:ContributedCapitalMember 25013719 2021-12-31 fsa:ContributedCapitalMember 25013719 2020-12-31 fsa:ReserveForDevelopmentExpenditureMember 25013719 2021-01-01 2021-12-31 fsa:ReserveForDevelopmentExpenditureMember 25013719 2021-12-31 fsa:ReserveForDevelopmentExpenditureMember 25013719 2020-12-31 fsa:RetainedEarningsMember 25013719 2021-01-01 2021-12-31 fsa:RetainedEarningsMember 25013719 2021-12-31 fsa:RetainedEarningsMember 25013719 2020-12-31 fsa:ProposedDividendRecognisedInEquityMember 25013719 2021-01-01 2021-12-31 fsa:ProposedDividendRecognisedInEquityMember 25013719 2021-12-31 fsa:ProposedDividendRecognisedInEquityMember 25013719 2022-12-31 fsa:ContributedCapitalMember 25013719 2022-01-01 2022-12-31 fsa:ReserveForDevelopmentExpenditureMember 25013719 2022-12-31 fsa:ReserveForDevelopmentExpenditureMember 25013719 2022-01-01 2022-12-31 fsa:RetainedEarningsMember 25013719 2022-12-31 fsa:RetainedEarningsMember 25013719 2022-01-01 2022-12-31 fsa:ProposedDividendRecognisedInEquityMember 25013719 2022-12-31 fsa:ProposedDividendRecognisedInEquityMember 25013719 2022-01-01 2022-12-31 1 25013719 2022-01-01 2022-12-31 1 25013719 2022-01-01 2022-12-31 2 25013719 2022-01-01 2022-12-31 3 iso4217:EUR xbrli:pure Marel A/S 25013719 P.O. Pedersens Vej 18 8200 Aarhus N Arni Sigurjonsson The Board of Directors and the Management Board have today discussed and approved the an-nual report of Marel A/S for the financial year 1 January to 31 December 2022. The annual report has been prepared in accordance with the Danish Financial Statements Act. In our opinion, the financial statements give a true and fair view of the Company's assets, liabili-ties and financial position at 31 December 2022 and of the results of its operations for the finan-cial year 1 January – 31 December 2022. 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 fi-nancial position. We recommend that the annual report be approved at the annual general meeting. Aarhus Janne Sigurdsson Arni Sigurjonsson Chairman Søren K. S. Flummer Morten Munk Rasmussen To the shareholders of Marel A/S We have audited the financial statements of Marel A/S for the financial year 1 January – 31 De-cember 2022 comprising income statement, balance sheet, statement of changes in equity, cash flow statement 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 Company's assets, liabili-ties and financial position at 31 December 2022 and of the results of the Company's operations for the financial year 1 January – 31 December 2022 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 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 ethi-cal 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, that 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 audi-tor'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 in Denmark will always detect a material misstatement when it exists. Misstatements may 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 financial statement users made on the basis of these financial statements. As part of an audit conducted in accordance with ISAs and the additional requirements applica-ble 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 company 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, misrepre-sentations or the override of internal control.  obtain an understanding of internal control relevant to the audit in order to design audit proce-dures 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 ma-terial 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 conclu-sions 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. 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 Manage-ment's review and, in doing so, consider whether the Management's review is materially incon-sistent with the financial statements or our knowledge obtained during the audit, or otherwise ap-pears to be materially misstated. Moreover, it is our responsibility to consider whether the Management's review provides the in-formation 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 Manage-ment's review. Aarhus KPMG Statsautoriseret Revisionspartnerselskab 25578198 Mikkel Trabjerg Knudsen Michael E.K. Rasmussen State Authorised Public Accountant State Authorised Public Accountant Aarhus 135377000 127175000 105195000 97627000 90525000 24874000 18590000 20448000 18502000 19462000 7236000 5048000 7910000 4804000 8002000 2903000 1885000 3178000 1169000 7184000 8450000 6056000 10083000 4988000 13688000 129366000 126897000 100505000 96474000 89165000 28728000 25282000 23219000 22589000 25650000 1908000 9550000 798000 252000 324000 0.18 0.15 0.19 0.19 0.21 0.05 0.04 0.07 0.05 0.09 0.08 0.06 0.12 0.08 0.15 0.31 0.25 0.44 0.21 0.52 0.22 0.20 0.23 0.23 0.29 The financial ratios are defined as follows: Gross margin Gross profit/loss x 100 Revenue Operating margin Ordinary operating profit/loss x 100 Revenue Return on invest- Ordinary operating profit/loss ment Average number of operating assets Return on equity Profit after tax x 100 Average equity Solvency ratio Equity at year end x 100 Total equity and liabilities at 31 December Operating review Principal activities Marel is a leading global provider of advanced processing equipment, systems, software and ser-vices to the poultry, meat and fish industries. Marel has a global reach with local presence in over 30 countries, with sales and service engineers servicing customers in over 140 countries. Marel’s business model is based on providing full-line solutions and services to the food pro-cessing industry, one of the most important value chains in the world. With an emphasis on inno-vation, close partnership with customers, and global and local reach, this model supports our vi-sion of a world where quality food is produced sustainably and affordably. Our revenue streams consist of sales of standard equipment, major projects, and recurring sales of parts, services, and software licenses. We have a global customer base diversified across dif-ferent industries, product mixes, and geographical areas, allowing us to achieve and maintain strong profitability throughout economic cycles. Development in activities and financial position Revenue in 2022 totalled EUR 135.4 million, which is an increase by EUR 8.2 million (6.4%) compared to 2021. The higher revenue combined with changes in product mix resulted in a gross profit of EUR 24.9 million compared to EUR 18.6 million in 2021. This has led to a gross margin of 18.4% compared to 14.6% in 2021. The profit for the year after tax totalled EUR 8.5 million, which is an increase of EUR 2.4 million (+39.5%) compared to 2021. Equity totalled EUR 28.7 million at the end of the year, corresponding to a solvency ratio of 22.3%. In 2022, a dividend of EUR 5.0 million was paid. Overall, the financial statements are in line with our expectations disclosed in the latest published annual report. Events after the balance sheet date No events materially affecting the Company’s financial position have occurred subsequent to the financial year end. Unusual circumstances Market conditions remain challenging due to the ongoing pandemic, the war in Ukraine, contin-ued supply chain disruption, higher interest rates and inflation at high levels resulting in ineffi-ciencies in manufacturing and aftermarket, and higher cost associated with timely delivery. There are signs of easing in supply chain and parts availability which should improve operational efficiency. Particular risks Our management has identified certain key risks to our business that demand attention. Of these, seven key risks are discussed below, together with an overview of corresponding mitigative ac-tions. Profit and earnings volatility risk: Our operational results are subject to volatility. Factors like increase in competition, geopolitical conflicts, trade restrictions, and natural disasters might influence our ability to predict revenues, costs, and expenses affecting our growth objectives. Our business model with revenue streams generated by different industries, geographical areas, and product mix allows us to achieve and maintain strong profitability throughout economic cycles. Innovation risk: Changes in technology, failure to understand customer needs, inability to enforce intellectual prop-erty rights, etc. can affect our expansion objectives. Our success depends on our ability to develop and successfully introduce new products in addition to ensuring the competitiveness of existing ones, including solutions and software. Marel will continue to lead the innovation game in the food processing industry by committing significant resources to support its ambitious innovation objectives. People management risk: A high turnover rate, disengaged employees, gaps in workforce skills or misalignment of those skills with the company’s needs, an inadequate succession plan, etc. can harm our business. Work-place instability, absenteeism, and additional stress caused by the global pandemic, coupled with changing global workforce preferences, further increase the risk of effective talent management. Marel remains a desirable place to work that attracts and retains talented employees. Throughout the pandemic, we have implemented initiatives to maintain motivation and engage with our work-force in a personal manner. Marel is proactive in adapting its policies to align with current global trends. Particular risks Supply chain disruption risk: As a manufacturer of leading technology solutions, we rely on the timely supply of inputs, as well as continued supply of scarce resources. The global pandemic caused instability in commercial transport and saw an increase in the demand of raw materials. This can lead to increased costs as well as delays to customer delivery. Marel makes use of its global footprint to mitigate supply chain risks, while continuing to adopt new supply chain technologies. Deliberate mitigations include the increasing of inventory levels, as well as identifying substitute suppliers. The company remains agile and proactive when priori-tizing its manufacturing needs. Reputation and compliance risk: Marel operates worldwide and needs to comply with numerous and changing laws and regulations. Failure to comply can lead to penalties and adverse publicity. The evolution of social media further increases the risk of reputational damage. Marel strives to preserve and enhance its brand value, build resilience, and create emotionally connected customers, employees, and stakeholders, while complying with all industry, regulatory, and other general standards of significance. Information security risk: Failure to secure our information systems and data could result in operational disruptions, financial losses, reputational damage with existing and new customers, etc. Marel continues to invest in new facilities and infrastructure and in upgrading existing ones to ensure their integrity and availability in case of adverse events. Foreign exchange risk: As an international company, Marel is exposed to foreign exchange risk arising from various cur-rency movements, primarily with respect to the EUR/USD exchange rate for revenues and EUR/ISK rate on the cost side. Marel takes advantage of natural currency hedges by matching revenues and operational costs as economically as possible. The company’s funding is denominated in its main operational curren-cies to create natural hedging in the balance sheet. Where necessary, financial exposure is hedged in accordance with Marel’s policy on permitted instruments and exposure limits. Intellectual capital The primary business foundation is to provide competitive products, solutions and technology for the food industry improving its competitiveness. Accordingly, the Company must be able to de-velop and retain intellectual capital and know-how on products and business processes. The Com-pany therefore regularly develops policies and procedures for recruiting, training and retaining employees and for developing and documenting products and business processes. Research and development activities The Company's research and development activities comprise regular development of new and existing products and processes for the food industry. Marel is committed to developing industry-leading technology in partnership with our customers. Annually, we invest approximately 6-8% of revenues in research and development, which translat-ed to EUR 9.6 million in 2022. This is essential to the creation of transformative solutions for the food processing industry and securing our competitive advantage, which in turn deliver or-ganic growth to the company. Branches in Uruguay The company has an established Branch in Uruguay operating under the name Marel A/S Sucursal Uruguay performing sales and service activities in the local market. In 2022, the branch had an operating profit of EUR 0.2 million before taxes. Outlook The continued geopolitical tensions, especially in Europe is still causing uncertainty. Marel has a balanced exposure to global economies and local markets through its global reach, innovative product portfolio and diversified business mix. Indeed, our business model has proved to be resil-ient during times of turbulence. Our global reach and years of investment in innovation and digital solutions have proved to be key differentiating factors for Marel. These will enable us to push forward and help us navigate geopolitical tensions in the long run. That path is of course one of discovery to some extent, with inherent challenges and learnings, but one that team Marel will manage with its characteristic determination. The expectation for 2022 is a revenue between EUR 110 – 120 million and an EBIT between EUR 4 – 8 million. These expectations are subjected to uncertainties due the increased geopolitical ten-sions mentioned above. Corporate social responsibility Marel A/S is part of the Marel Group that has signed the United Nations Global Compact. The Company meets the statutory requirement for Corporate Social Responsibility by following the Consolidated Sustainability Policy for Marel Group. For the statutory reporting on Corporate So-cial Responsibility, according to §99a in the Danish Financial Statement Act, we refer to the offi-cial CSR reporting for the group which can be found in the ESG report for Marel on the website: https://marel.com/en/investors/financials#sustainability-and-esg Policies and goals for the underrepresented gender This section constitutes Marel A/S’ reporting on gender diversity according to §99b in the Danish Financial Statements Act. The Marel Group promotes diversity in all its locations worldwide. We must ensure that Marel has a diverse and truly inclusive culture. With this in mind, we have set targets for achieving a better-balanced gender representation across managerial levels and included targets to that effect in our sustainability program. Goals and policies for the underrepresented gender We understand the value of reflecting the markets and communities we serve across all dimensions – whether that is servicing our customers in their local languages, listening to the needs of our end consumers, moving towards fully local management teams in the regions or hiring and developing more diverse talent in technical roles. Marel employees, prospective employees, contractors, con-sultants, suppliers, and customers must be treated equally and should not be discriminated against on the grounds of age, race or ethnicity, nationality, or on any other aspect. We want to lead by example and have already taken steps towards this with a well gender-balanced board and executive team. We are also committed to ensuring the right diversity and set of com-petences at all managerial levels to meet future challenges. We hope to be part of moving our industry towards more diversity and more inclusivity going forward, and feel very proud that both our Board and Executive team are in the optimal gender balance within the 40-60% ratio. In 2021, Marel introduced a new Global Diversity and Inclusion Policy with additional focus on inclusion and accountability. To embed D&I in our culture, it was decided to do more than offer simple training. Instead, almost 40 employees from all around the globe stepped forward and be-came D&I champions and completed a two-day workshop. We now have the foundation to imple-ment and follow through with D&I initiatives supported by a diverse group of enthusiastic liaisons. The first initiative is inviting all employees to a course on creating a culture of inclusion. This one-hour interactive talk is facilitated by Marel’s champions. The course is offered online and in person in 13 languages, demonstration our dedication to inclusivity. Approximately 52% of the employ-ees have taken part in the course by the end of 2022. Policy for the gender quota in the Board of Directors Under section 99b of the Danish Financial Statement Act, the Board of Directors of Marel A/S has laid down the Company's policy to increase the share of the underrepresented gender in the Com-pany's Management in general. The Board of Directors of Marel A/S consists of three men. As this is not compliant with the Danish Business Authority’s recommendations, Marel A/S will actively seek to promote a woman for the position during the coming year. Policy for other management levels Marel A/S wishes that the gender quota of society between men and women is reflected in the Company's management level. Through this policy, the Company will create an equal distribution of sexes at management level. Managers of the Company should be elected / employed based on their overall qualifications, and it is essential that the managers have the right qualifications, irrespective of their sex. The Board of Directors, however, acknowledges the advantages of a broad-based management at all levels taking into consideration experience, specialized knowledge, culture and sex, etc. Marel A/S is in a line of business, which has a predominance of male employees. The present management team including the management board, comprises eight persons of which one is fe-male. In the management team, we seek diversity in line with Group policy. Marel aims to obtain equality between co-workers, and finds that the positions in the management team are equally suitable for both men and women. However we do not have frequently changes in the management group. In case a manager leaves, Marel will strive to get a more diverse management team, as we want to improve the gender balance for the future, as well as making a systematic effort to give the em-ployees a good work life balance. The measures initiated have not yet implied any changes in the gender quota of the management team during 2022, as no replacements has taken place. Reporting on data ethics Marel is committed to the responsible and transparent use and protection of personal data entrusted to us by customers, employees, and others. We provide our employees and contractors with train-ing on global privacy principles in accordance with our commitment to respect and safeguard per-sonal data. Our Data Ethics Policy are governed by Marel Compliance, and they will regularly assess whether the policy needs to be updated and initiate relevant updates. Marel Compliance will supervise and report on the day-to-day work of using the data ethic principles of the Policy. Marel Compliance monitors compliance with this Policy with relevant checkpoints, communicating the reports sig-nificant risks or breaches to the Marel Executive Board. Example of the practices we follow to help ensure the integrity of our data privacy processes in-clude:  Collecting and using the minimum amount of personal data necessary to achieve our business Purposes.  Sharing personal data only with individuals who have a legitimate need for it and will protect it.  Maintaining appropriate administrative, technical, and organizational security measures to pro-tect personal data.  Training our employees on the responsible use of personal information 110503000 108585000 8447000 5959000 9268000 7583000 2420000 2164000 2223000 720000 1740000 999000 10062000 6933000 1690000 877000 761000 1298000 6442000 5509000 2000 3000 7205000 6810000 17697000 18134000 148000 179000 1221000 1229000 1256000 19000 20322000 19561000 35378000 35378000 35378000 35378000 62905000 61749000 32726000 30525000 2497000 1666000 9022000 8730000 18337000 19039000 0 537000 747000 806000 25000 42000 30628000 30820000 3107000 3803000 66461000 65148000 1342000 1342000 4279000 2855000 18107000 16085000 -5000000 -5000000 3557000 3463000 4293000 4024000 472000 478000 64000000 63846000 2652000 2593000 67124000 66917000 472000 452000 2338000 927000 5742000 11776000 15248000 12006000 370000 0 5051000 5512000 29221000 30673000 96345000 97590000 129366000 126897000 1342000 3120000 14757000 4000000 -7000 -7000 -265000 6321000 0 0 4000000 4000000 5000000 -5000000 0 1342000 2855000 16085000 5000000 -73000 -73000 1424000 6949000 5000000 5000000 5000000 -5000000 0 1342000 4279000 18107000 5000000 The annual report of Marel A/S for 2022 has been prepared in accordance with the provisions applying to reporting class C large enterprises under the Danish Financial Statements Act. Foreign currency translationOn initial recognition, transactions denominated in foreign currencies are translated at the exchange rates at the transaction date. Foreign exchange differences arising between the exchange rates at the transaction date and at the date of payment are recognised in the income statement as financial income or financial expenses. Receivables and payables and other monetary items denominated in foreign currencies are translated at the exchange rates at the balance sheet date. The difference between the exchange rates at the balance sheet date and at the date at which the receivable or payable arose or was recognised in the latest financial statements is recognised in the income statement as financial income or financial expenses.Non-current assets acquired in foreign currencies are measured at the exchange rate at the transaction date.Consolidated financial statementsIn accordance with section 112 (1) of the Danish Financial Statements Act, the Company has not prepared consolidated financial statements, as the Company is a subsidiary and as the financial statements of the Company and its subsidiaries are included in the consolidated financial statements of the parent company, Marel hf., Iceland.Income statementRevenueRevenue from the sale of goods and services is recognised in the income statement provided that delivery and transfer of risk to the buyer have taken place before year-end and that the income can be reliably measured and is expected to be received. Contract work in progress is recognised at the selling price of the work performed. Revenue is measured excl. VAT and taxes and less discounts granted in connection with the sale.Production costsProduction costs comprise costs incurred in generating the revenue for the year. Such costs include direct and indirect costs for raw materials, goods for resale and consumables, wages and salaries, rent and leases, and depreciation of production plant and other assets used for production purposes. Write-down for inventories and write-down in connection with anticipated bad debt losses on contract work in progress are also included. Production costs also comprise development costs that do not qualify for capitalisation and amortisation of capitalised development costs.Distribution costsCosts incurred in distributing goods sold during the year and in conducting sales campaigns, etc. during the year are recognised as distribution costs. Also, costs relating to sales staff, advertising and depreciation are recognised as distribution costs. Administrative expensesAdministrative expenses comprise expenses incurred during the year for Company management and administration, including expenses for administrative staff, management, office premises, insurance and office expenses, etc. and depreciation.Other operating income or operating cost Other operating income and cost comprises items secondary to the activities of the Company, including gains and losses on the disposal of non-current assets.Result from investments in subsidiariesResult from investments in subsidiaries comprises dividends from subsidiaries recognised as income in the income statement when adopted at the General Meeting of the subsidiary.Financial income and expensesFinancial income and expenses comprise interest income and expense, finance charges in respect of finance leases, realised and unrealised gains and losses on securities, payables and transactions denominated in foreign currencies, amortisation of financial assets and liabilities as well as surcharges and refunds under the on-account tax scheme, etc.Tax on profit/loss for the yearTax for the year comprises current tax for the year end and changes in deferred tax, including changes in tax rates. The tax expense relating to the profit/loss for the year is recognised in the income statement at the amount attributable to the profit/loss for the year and directly in equity at the amount attributable to entries directly in equity. Balance sheetIntangible assetsDevelopment projects comprise costs directly and indirectly attributable to the Company's development activities and which comply with the criteria for recognition under the Danish Financial Statements Act. Capitalised development projects are measured at cost less accumulated amortisation or at recoverable amount if the latter is lower. Capitalised development projects are amortised on a straight-line basis of the estimated useful lives after completion of the development project. The amortisation period is usually five years.Goodwill is measured at cost less accumulated amortisation and impairment losses.Goodwill is amortized on a straight-line basis over the remaining life. Depreciation is provided on a straight-line basis over the expected useful lives of the assets. The expected useful lives are as follows:Goodwill10yearsSoftware3 - 5yearsProperty, plant and equipmentLand and buildings, plant and machinery, fixtures and fittings, as well as other plant and equipment are measured at cost less accumulated depreciation. Land is not depreciated.The basis of depreciation is cost less expected residual value at the end of the useful life.Cost comprises the purchase price and any costs directly attributable to the acquisition until the date when the asset is available for use. Where individual components of an item of property, plant and equipment have different useful lives, they are accounted for as separate items, which are depreciated separately. The basis of depreciation is cost less any projected residual value after the end of the useful life. Depreciation is provided on a straight-line basis over the estimated useful lifeDepreciation is provided on a straight-line basis over the expected useful lives of the assets. The expected useful lives are as follows:Buildings20 - 55yearsPlant and machinery3 - 10yearsFixtures, fittings and other equipment4 - 6yearsThe useful life and residual value are reassessed annually. Changes are treated as accounting estimates, and the effect on depreciation is recognised prospectively.Gains and losses on the disposal of property, plant and equipment are determined as the difference between the selling price less selling costs and the carrying amount at the date of disposal. Gains or losses are recognised in the income statement as other operating income or operating costs.Leased assetsOn initial recognition, leases for fixed assets that transfer substantially all risks and rewards incident to ownership to the Company (finance leases) are recognised in the balance sheet at the lower of fair value and the net present value of future lease payments. When the net present value is calculated, the interest rate implicit in the lease or the incremental borrowing rate is used as the discount factor. Assets held under finance leases are subsequently depreciated as the Company's other fixed assets.The capitalised residual lease obligation is recognised in the balance sheet as a liability, and the interest element of the lease payment is recognised in the income statement over the term of the lease.Short term leases and leases of low-value assetsShort term leases that have a lease term of 12 month or less and leases of low-value assets are not recognized as right of use assets and lease liability and the lease payments associated with these leases are expensed as a straight line base over the lease term.The Company's obligation relating to these leases is disclosed in contingent liabilities.Equity investmentsEquity investments in subsidiaries are recognised in the balance sheet at cost. Write-down is made to the lower of cost and recoverable amount. Cost is reduced by dividends received that exceed accumulated earnings after the date of acquisition.For subsidiaries where the parent company has a legal or constructive obligation to cover the deficit equity investments are written down corresponding to the parent company's share of negative equity. Any receivable from these enterprises is written down by the parent company's share of the negative net asset value. If the net asset value exceeds the amount owed, the residual amount is recognised under provisions.Impairment of non-current assetsThe carrying amount of intangible assets and property, plant and equipment as well as investments in subsidiaries is subject to an annual test for indications of impairment other than the decrease in value reflected by depreciation or amortisation.Impairment tests of individual assets or groups of assets are conducted when there is an indication that they may be impaired. Write-down is made to the recoverable amount if this is lower than the carrying amount.The recoverable amount is the higher of an asset's net selling price and its value in use. The value in use is determined as the present value of the anticipated net cash flows from the use of the asset or group of assets.Previously recognised write-downs are reversed when the basis for the write-down no longer exists. Write-down of goodwill is not reversed.InventoriesInventories are measured at cost in accordance with the average cost formula. Where the net realisable value is lower than cost, inventories are written down to this lower value.Goods for resale and raw materials and consumables are measured at cost, comprising purchase price plus delivery costs.Finished goods and work in progress are measured at cost, comprising the cost of raw materials, consumables, direct wages and salaries as well as direct and indirect production overheads. The net realisable value of inventories is calculated as the sales amount less costs of completion and costs necessary to make the sale and is determined taking into account marketability, obsolescence and development in expected sales price.ReceivablesReceivables are measured at amortised cost. Write-down is made for bad debt losses where there is an objective indication that a receivable or a receivable portfolio has been impaired. If there is objective evidence that an individual receivable has been impaired, write-down is made on an individual basis.Receivables with no objective indication of individual impairment are assessed for objective indication of impairment on a portfolio basis. The portfolios are primarily composed on the basis of the country of domicile and credit ratings of the debtors in accordance with the credit risk management policy of the Company. The objective indicators used in relation to portfolios are determined based on historical loss experience.Write-downs 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.Contract work in progressContract work in progress is measured at the selling price of the work performed. The selling price is measured by reference to the stage of completion at the balance sheet date and total expected income from the work. The degree of completion is computed as the proportion between resources spent and total estimated resources for the completion of the contract. When it is probable that contract work in progress will result in losses, the estimated loss is recognised in the income statement.When the selling price of contract work in progress cannot be measured reliably, the contract work in progress is measured at the lower of costs incurred and net realisable value.The individual work in progress is recognised in the balance sheet as receivables or payables depending on the net value of the sales amount less on-account invoicing and prepayments. Selling costs and costs incurred in securing contracts are recognised in the income statement as incurred.PrepaymentsPrepayments comprise costs incurred concerning subsequent financial years, such as office rent, insurance premiums and licences. EquityDividends:The expected dividend payment for the year is disclosed as a separate item under equity.Reserve for development costs:The reserve for development costs comprises capitalised development costs. The reserve cannot be used for dividend, distribution or to cover losses. If the recognised development costs are sold or in other ways excluded from the Company's operations, the reserve will be dissolved and transferred directly to the distributable reserves under equity. If the recognised development costs are written down, the part of the reserve corresponding to the write-down of the developments costs will be reversed. If a write-down of development costs is subsequently reversed, the reserve will be re-established. The reserve is reduced by amortisation of capitalised development costs on an ongoing basis.Corporation tax and deferred taxCurrent tax payable and receivable is recognised in the balance sheet as tax computed on the taxable income for the year, adjusted for tax on the taxable income of prior years and for tax paid on account.Deferred tax is measured using the balance sheet liability method on all temporary differences between the carrying amount and the tax value of assets and liabilities. Where alternative tax rules can be applied to determine the tax base, e.g. regarding shares, deferred tax is measured based on the planned use of the asset or settlement of the liability, respectively.Deferred tax assets, including the tax value of tax loss carryforwards, are measured at the expected value of their realisation; either as a set-off against tax on future income or as a set-off against deferred tax liabilities in the same legal tax entity. Any deferred net assets are measured at net realisable values.Deferred tax is measured according to the tax rules and at the tax rates applicable at the balance sheet date when the deferred tax is expected to crystallise as current tax. Changes in deferred tax due to changes in tax rates are recognised in the income statement.The Company is jointly taxed with other Danish subsidiaries and affiliated companies. Current Danish corporation tax is settled by the parent company, which is the administrative company, and allocated between the jointly taxed companies in proportion to their taxable income. ProvisionsProvisions comprise expected costs of warranties, losses on work in progress, restructurings, etc.Liabilities other than provisionsFinancial liabilities comprising amounts owed to credit institutions, trade payables and payables to group enterprises are recognised at the date of borrowing at cost, corresponding to the proceeds received less transaction costs paid. In subsequent periods, financial liabilities are measured at amortised cost.Financial liabilities also include the capitalised residual obligation on finance leases.Other liabilities are measured at net realisable value.Segment informationSegment information is provided on business segments and geographical markets. The segment information is in line with the Company's accounting policies, risks and internal financial management. true Applied exemption clauses in the Danish Financial Statements ActIn accordance with section 86(4) of the Danish Financial Statements Act, the Company has not prepared a cash flow statement, as this is included in the consolidated cash flow statement of the parent company, Marel hf., Iceland. Pursuant to section 96(3) of the Danish Financial Statements Act, the Company has not disclosed the fee to the auditors appointed at the annual general meeting.Pursuant to section 98b(3) of the Danish Financial Statements Act, the Company has not disclosed remuneration of Management as only one member of the Management Board is remunerated.The financial statements of Marel A/S are included in the consolidated financial statements of Marel hf., Austurhraun 9, 210 Gardabaer, Iceland. The consolidated financial statements can be downloaded at www.marel.com. Wages and salaries, etc. 33.448 28.315Pensions 2.453 1.960Other social security costs 482 41336.382 30.688Staff costs are recognised as follows:Production 25.690 21.793Distribution 6.072 5.155Administration 4.620 3.74036.382 30.688Pursuant to section 98b(3) of the Danish Financial Statements Act, the Company has not disclosed remuneration of Management as only one member of the Management Board is remunerated. 373 314 The identified operating segments comprise the three industries, which are the reporting segments. These operating segments form the basis for managerial decision taking.The segment information for the period ended 31 December 2022 is as follows:PoultryFishMeatOthersTotalRevenue 67.704 24.543 34.187 8.944 135.377Geographical informationThe Companys operating segments operate in four main geographical areas20222021Revenue(EUR'000) (EUR'000)Denmark6.9137.033Europe other95.26562.757North America18.16535.183Other countries15.03522.202Total 135.377 127.175 Land and building 437 682Plant and machinery 46 54Fixtures, fittings and other equipment 621 558Leasehold improvements 0 01.105 1.294Depreciations are recognised as follows:Production 243 214Distribution 365 671Administration 497 4091.105 1.294 Result from investments in subsidiariesDividends from group enterprises 2.420 2.1642.420 2.164 Other financial income 2.223 7212.223 721 Interest expense, group companies 1.258 711Interest expense, leasing 14 105Other financial expenses 467 1831.740 999 Tax on profit for the year is specified as follows:Current tax -1.552 -960Correction tax prior years -45 -9Deferred tax -131 92Correction deferred tax prior years 37 0-1.690 -877 -1424000 265000 Cost at 1 January 22.856 3.898 26.754Additions 0 1.722 1.722Cost at 31 December 22.856 5.620 28.476Impairment loss and amortisation at 1 January 21.245 0 21.245Amortisation and impairment for the year 790 0 790Impairment loss and amortisation at 31 December 22.034 0 22.034Carrying amount at 31 December 821 5.620 6.442Completed development projects relate to the deveopment and test of machines for the food processing industry and are usually amortised over five years.Ongoing development projects relate to the development and test of machines for the food processing industry and the majority of the projects are expected to be completed within 1-3 years where considerable economic benefits are expected.Software GoodwillCost at 1 January 618 8.295Foreign exchange adjustments at 1 January 7 0Cost at 31 December 625 8.295Impairment loss and amortisation at 1 January 615 6.997Foreign exchange adjustments at 1 January 6 0Amortisation for the year 2 536Impairment loss and amortisation at 31 December 623 7.534Carrying amount at 31 December 2 761Goodwill is amortized over 10 years, as the service business is linked to equipment with a long lifespan. Cost at 1 January 20.641 1.036 1.481 19 0Foreign exchange adjustments at 1 January 2 7 14 -0 0Additions 0 14 35 1.237 0Cost at 31 December 20.643 1.057 1.530 1.256 0Impairment loss and depreciation at 1 January2.6898571.00600Foreign exchange adjustments at 1 January271400Depreciation for the year 322 46 165 0 0Impairment loss and depreciation at 31 December3.012 909 1.185 0 0Carrying amount at 31 December 17.630 148 345 1.256 0Leased assetsCost at 1 January 196 0 1.612 0 0Foreign exchange adjustments 3 0 5 0 0Additions 4 0 618 0 0Disposals 0 0 -317 0 0Cost at 31 December 202 0 1.918 0 0Impairment loss and depreciation at 1 January 14 0 858 0 0Foreign exchange adjustments 3 0 5 0 0Disposals 3 0 -278 0 0Depreciation for the year 116 0 457 0 0Impairment loss and depreciation at 31 December136 0 1.042 0 0Carrying amount at 31 December 66 0 876 0 0Total17.6971481.2211.2560 Equity investments in group companiesCost at 1 January 35.378 35.378Cost at 31 December 35.378 35.378Carrying amount at 31 December 35.378 35.378Specification of subsidiaries Owner- Profit/Registeredsee latest published financial statements ship loss Equityoffice(EUR'000) (EUR'000)Marel Salmon A/S Denmark 100% 3 17Marel New Zealand Limited New Zealand 100% 233 1.115Marel GB Ltd. England 100% 1.530 4.941Marel Food Systems Ltd. Ireland 100% 156 1.620Marel Polska Sp. z.o.o. Poland 100% 339 552Marel Chile SPA Chile 100% 1.650 2.439Marel Equipameintos Industriales S.A. Uruguay 100% 354 186 Finished goods 6.193 5.376Work in progress 26.529 25.141Raw materials and consumables 3 832.726 30.525Contract work in progress 8.302 8.498Progress billings -1.618 -695Net value at 31 December 6.684 7.803- recognised as follows:Contract work in progress 9.022 8.730Prepayments from customers -2.338 -927Net value at 31 December 6.684 7.803In the above, numbers are intercompany projects included with a sales value of EUR 7,427 thousand and progress billings of EUR 136 thousand or a net value of EUR 7,291 thousand with EUR 7,427 thousand reported under assets and EUR 136 thousand reported under liabilities. Deferred tax at 1 January 3.463 3.555Deferred tax for the year recognised in profit for the year 95 -92Deferred tax at 31 December 3.557 3.463Deferred tax relates to:Intangible assets 1.584 1.497Property, plant and equipment 959 988Retaxation obligation, foreign entities 13 38Current assets 1.001 937Provisions 0 2Leased assets and liabilities 1 13.557 3.463 The Company's share capital amounts to EUR 1,342 thousand, broken down on a share with a face value of EUR 134.2 thousand. No shares carry special rights.2022 2021 2020 2019 2018Share capital for the last 5 years 1.342 1.342 1.342 1.342 1.342 2022 2021WarrantiesBalance at 1 January 512 488Adjustments for the year 128 24Balance at 31 December 640 512Date of maturity is expected to be 0-1 yearOther provisionsReorganization Provision 76 0Employee Benefits Provision 20 0Other provisions 0 4996 49Date of maturity is expected to be 0-1 year Finance leases 472 472 944 0Payables to group enterprises 15.248 64.000 79.248 0Other payables 5.049 2.652 7.701 2.35820.769 67.124 87.892 2.358 Marel A/S' related parties comprise the following:Control:Marel hf., Austurhraun 9, Gardabaer, IcelandMarel hf. Holds the majority of the share capital in the CompanyMarel A/S is part of the consolidated financial statements of Marel hf. Austurhraun 9, Gardabaer, Iceland, which is the smallest and largest group in which the Company is included as a subsidiary.The consolidated financial statements of Marel hf. can be obtained by contacting the Company or at the following website: www.marel.com.Related party transactions:GroupSale of goods 113.413 110.381Production costs -54.643 -59.610Distribution costs -76 -1.021Administrative expenses 3.787 3.147Interest -1.258 -711Total 61.223 52.186Parent CompanyDividend -5.000 -5.000Total -5.000 -5.000Payables and receivables to group enterprises are disclosed in the balance sheet and in note 14 and 19, and expensed interest and received dividend is disclosed in note 5 and 7. Collateral, contingent liabilities and lease liabilitiesThe Company is jointly taxed with other Danish group companies. As the administrative company, together with the other companies included in the joint taxation, the Company has joint and several unlimited liability for Danish corporation taxes and withholding taxes on dividends, interest and royalties. Corporation taxes payable and withholding taxes within the joint taxation unit totalled a payable of EUR 964 thousand at 31 December 2022. Any subsequent corrections to the taxable joint taxation income or withholding taxes may imply that the Company's liability will increase.Cash at bank and in hand amounting to EUR 3,107 thousand has been pledged as security for a group cash pool.In February 2020, Marel hf., entered into a restated Facility Agreement. In relation to this, the shares in Marel Salmon A/S amounting to EUR 15,205 thousand have been provided as collateral to the lenders. Annual report Auditor's report on audited financial statements ParsePort XBRL Converter 2022-01-01 2022-12-31 2021-01-01 2021-12-31 2023-06-28 Reporting class C, large enterprise 1969-05-19 2023-06-28 25578198 KPMG P/S Dampfærgevej 28 2100 København Ø Opinion Basis for Opinion 2023-06-28 mne34459 mne41364 25578198 KPMG Statsautoriseret Revisionspartnerselskab 736000 561000