BDO Statsautoriseret revisionsaktieselskabHavneholmen 29DK-1561 København V20222670Årsrapport2024-06-27Max Tomas LundbergGrad ApSVesterbrogade 1491620 Copenhagen VRevisionspåtegning369518422015-07-02Copenhagen2023-01-012023-12-312022-01-012022-12-31BDO Statsautoriseret revisionsaktieselskabHavneholmen291561Copenhagen VDanske Bank Erhverv KøbenhavnBernstorffsgade401577Copenhagen VCopenhagen2024-06-27Max Tomas LundbergMax Tomas LundbergChairmanJimmy Fussing NielsenStefan Gustav Gunnar PerssonKonklusionGrundlag for konklusionCopenhagen2024-06-27BDO Statsautoriseret revisionsaktieselskab20222670Kim MückeRevisionspåtegningState Authorised Public Accountantmne10944743355646700525961707587031437433883334703-2271539-45349652183611502151528296442076-3581474-4826826-709808-1365009-2871666-3461817-2871666-3461817-2871666-34618171146430310036704114643031003670435856392279001198113120836054502310209110172103221110172103221151799251245013425009217000047945122712732729543327827321789515640856142834713156497388013296218386210752142756042209562333139722045671490243471968613008235919646995830768307689421567828629-30044269807676020806889247265443073019365443073019340003738073622817322651075010754133036992756000440416712590282505633273136821125391737325523407123100243303008235919646995830767828629980767-28716661113527-1113527830768942156-30044269753304585221230373253402411530825399220491419268159617075870314-973880-13296213398350-75763-353881885902645494042340843088223223121805119441271146430328590185698619168260477584456986580019257786101861139711902053717535856391981110322169511101721101720Regnskabsklasse BtruetrueToday the Board of Directors and Executive Board have discussed and approved the Annual Report of Grad ApS for the financial year 1 January - 31 December 2023. The Annual Report is presented 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, liabilities and financial position at 31 December 2023 and of the results of the Company's operations for the financial year 1 January - 31 December 2023. The Management Commentary includes in our opinion a fair presentation of the matters dealt with in the Commentary. We recommend the Annual Report be approved at the Annual General Meeting. To the Shareholders of Grad ApS We have audited the Financial Statements of Grad ApS for the financial year 1 January - 31 December 2023, which comprise income statement, Balance Sheet, statement of changes in equity, notes and a summary of significant accounting policies. The Financial Statements are prepared in accordance with the Danish Financial Statements Act. In our opinion, the Financial Statements give a true and fair view of the assets, liabilities and financial position of the Company at 31 December 2023 and of the results of the Company's operations for the financial year 1 January - 31 December 2023 in accordance with the Danish Financial Statements Act. Basis for Opinion Grundlag for konklusion 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 (including International Independence Standards) (IESBA Code), together with the ethical requirements that are relevant to our audit of the financial statements in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our conclusion. Management's Responsibilities for the Financial Statements 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 judgment and maintain professional skepticism 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. 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. Statement on Management Commentary Management is responsible for Management Commentary. Our opinion on the Financial Statements does not cover Management Commentary, 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 Commentary and, in doing so, consider whether Management Commentary 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 Commentary provides the information required under the Danish Financial Statements Act. Based on the work we have performed, we conclude that Management Commentary is in accordance with the Financial Statements and has been prepared in accordance with the requirements of the Danish Financial Statements Act. We did not identify any material misstatement of Management Commentary. Principal activities The Company’s activities include design, development and sales of innovative cooling solutions for the beverage industry. Development in activities and financial and economic position During the year Grad has continued investing in its cutting edge design and technology. Together with the current product portfolio, we believe that these investments in development projects put Grad in a satisfying position within our industry in the short as well as long term. Significant events after the end of the financial year In 2024, the Company has received, significant orders on several of their both new and traditional product innovations. It will have a positve impact on the operations and financial statements during 2024 and beyond. In addition in 2024, the Company has received equity funding of DKK 4,7 mio. to strengthen the Company's working capital. DKK Share Capital Reserve for development costs Retained earnings Total Equity at 1 January 2023 83.076 7.828.629 980.767 8.892.472 Proposed loss allocation -2.871.666 -2.871.666 Other legal bindings Transfer 1.113.527 -1.113.527 0 Equity at 31 December 2023 83.076 8.942.156 -3.004.426 6.020.806 Staff costs 1 Average number of full time employees 9 7 Wages and salaries 5.330.458 5.221.230 Pensions 373.253 402.411 Social security costs 53.082 53.992 Other staff costs 204.914 192.681 5.961.707 5.870.314 Intangible assets 3 DKK Development projects completed Cost at 1 January 2023 18.859.026 Additions 4.549.404 Cost at 31 December 2023 23.408.430 Amortisation at 1 January 2023 8.822.322 Amortisation for the year 3.121.805 Amortisation at 31 December 2023 11.944.127 Carrying amount at 31 December 2023 11.464.303 Development projects cover the development of the Company’s products. Being a growth and development company there is inherent uncertainty as to the future commercial success and future profitability. Based on the success of the products launched to date and the expectation that the Company will be profitable in 2024 and forwards, Management assess that the value of future likely earnings at least equal the carrying value at 31 December 2023 of completed and ongoing development projects. Property, plant and equipment 4 DKK Other plant, machinery tools and equipment Leasehold improvements Cost at 1 January 2023 2.859.018 56.986 Additions 1.916.826 0 Cost at 31 December 2023 4.775.844 56.986 Depreciation and impairment losses at 1 January 2023 580.019 25.778 Depreciation for the year 610.186 11.397 Depreciation and impairment losses at 31 December 2023 1.190.205 37.175 Carrying amount at 31 December 2023 3.585.639 19.811 Financial non-current assets 5 DKK Rent deposit and other receivables Cost at 1 January 2023 103.221 Additions 6.951 Cost at 31 December 2023 110.172 Carrying amount at 31 December 2023 110.172 Long-term liabilities 6 31/12 2023 Repayment Debt outstanding 31/12 2022 total liabilities next year after 5 years total liabilities Other non-current liabilities 2.367.695 486.000 0 2.510.469 535.600 535.600.01 Frozen holiday pay 400.037 0 0 380.736 535.900 535.900.01 2.767.732 486.000 0 2.891.205 Contingent commitments The Company has entered into a rent contract with a total commitment DKK ('000) 225. Charges and securities 8 As security for debt of DKK ('000) 2,368, the Company has given a company charge of a nominal amount of DKK ('000) 2,671. The company charge includes the following assets, whose carrying amounts of which at the balance sheet date are: DKK Development projects completed 11.464.303 411 Other plant, machinery tools and equipment 3.585.639 422 Inventories 7.295.433 441 Trade receivables 1.789.515 450.100 Other receivables 1.428.347 450.400 Significant events after the end of the financial year 9 In 2024, the Company has received equity funding of DKK 4,7 mio. to strengthen the Company's working capital. Special items 10 2023 2022 DKK DKK Covid-19 compensation for fixed costs 592.525 832.075 592.525 832.075 The Annual Report of Grad ApS for 2023 has been presented in accordance with the provisions of the Danish Financial Statements Act for enterprises in reporting class B and certain provisions applying to reporting class C. Regnskabsklasse B1 true true The Annual Report is prepared consistently with the accounting principles applied last year. Net revenue Net revenue from the sale of merchandise and finished goods is recognised in the Income Statement when supply and risk transfer to purchaser has taken place and if the income can be measured reliably and is expected to be received. Grants received from coorporation partners to cover investments are recognised as income concurrently with depreciation on eligible investments. Net revenue is recognised exclusive of VAT and less duties and discounts related to the sale. Cost of sales Cost of sales comprise costs incurred to achieve the net revenue for the year, including direct and indirect costs of raw materials and consumables. Other operating income Other operating income includes items of a secondary nature in relation to the Company's principal activities, including profit from sale of intangible and tangible assets, government grants, as well as salary refunds. Compensations are recognised when the income is considered certain. Other external expenses Other external expenses include other production, sales, delivery and administrative costs, including it, marketing, premises, lease expenses, etc Payments related to operating leases and other lease agreements are expensed in the Income Statement over the contract period. The Company’s total liability concerning operating and other lease agreements are stated under contingencies, etc. Staff costs Staff costs comprise wages and salaries, including holiday pay and pensions, and other costs of social security etc., for the Company's employees. Financial income and expenses Financial income and expenses include interest income and expenses, currency gains and losses as well as charges and allowances under the tax-on-account scheme, etc. Financial income and expenses are recognised by the amounts that relate to the financial year. Interest income and expenses are recognised on basis of the amortised cost method. Tax The tax for the year, which consists of the current tax for the year and changes in deferred tax, is recognised in the Income Statement by the share that may be attributed to the profit for the year, and is recognised directly in equity by the share that may be attributed to entries directly to equity. Intangible fixed assets Development projects comprise costs, including wages and salaries, and amortisation, which directly or indirectly can be related to the Company’s development activities and which fulfil the criteria for recognition on the Balance Sheet such as there is a clear expectation that the development activities will result in products that will be available for sale in the future and thereby also implying that the Company has an intention and the ability to complete the development of the various product developments. The accounting item is measured at the lower of the capitalised costs less accumulated amortisation and recoverable amount. Capitalised development costs are amortised on a straight-line basis over the estimated useful life after completion of the development work. The amortisation period is normally 5 years. Tangible fixed assets Other plant, fixtures and equipment are measured at cost less accumulated depreciation and impairment losses. The depreciation base is cost less estimated residual value after end of useful life. The cost includes the acquisition price and costs incurred directly in connection with the acquisition until the time when the asset is ready to be used. Straight-line depreciation is provided on the basis of an assessment of the expected useful lives of the assets and their residual value: Useful lifeResidual value Other plant, fixtures and equipment 5 years 0 % Leasehold improvements 3-5 years 0 % Financial non-current assets The Other securities include rent deposit expected to be held to maturity and are measured at amortised cost. Impairment of fixed assets The carrying amount of intangible fixed and tangible assets together with financial fixed assets, which are not measured at fair value, are assessed annually for indications of impairment other than that reflected by amortisation and depreciation. In the event of impairment indications, an impairment test is made for each asset or group of assets, respectively. If the recoverable amount is lower than the carrying amount, the asset is written down to the recoverable amount. The recoverable amount is calculated at the higher of the capital value and the sales value less expected costs of a sale. The capital value is determined as the Company's share in the current value of the net cash flows which the subsidiary is expected to generate through its activities and from sale of assets after the end of their useful lives. A discount rate is used which reflects the risk-free market rate and the owners' minimum return on interest requirements for similar assets. The growth rate in the terminal period is determined in accordance with the standards within the industry. Inventories Inventories are measured at cost using the FIFO-principle. If the net realisable amount is lower than cost, the inventories are written down to the lower amount. The cost of finished goods includes the cost of raw materials, consumables, direct payroll cost and other direct production cost. The net realisable value of inventories is stated at the expected sales price less direct completion costs and costs incurred to execute the sale and is determined with due regard to marketability, obsolescence and development in expected sales price of the inventories. Receivables Receivables are measured at amortised cost which usually corresponds to nominal value. The value is written down to meet expected losses. Prepayments Prepayments recognised as assets include costs incurred relating to the subsequent financial year. Tax payable and deferred tax Current tax liabilities and receivable current tax are recognised in the Balance Sheet as the calculated tax on the taxable income for the year, adjusted for tax on the taxable income for previous years and taxes paid on account. Deferred tax is measured on the temporary differences between the carrying amount and the tax value of assets and liabilities. Deferred tax assets, including the tax value of tax loss carryforwards, are measured at the amount at which the asset is expected to be used within a reasonable number of years, either by setoff against tax on future earnings or by setoff 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 under the legislation in force on the Balance Sheet date will be applicable when the deferred tax is expected to crystallise as current tax. Any changes in the deferred tax resulting from changes in tax rates, are recognised in the income statement, except from items recognised directly in equity. Liabilities Financial liabilities are recognised at the time of borrowing by the amount of proceeds received less transaction costs. In subsequent periods, the financial liabilities are measured at amortised cost equal to the capitalised value when using the effective interest, the difference between the proceeds and the nominal value being recognised in the Income Statement over the loan period. The amortised cost of current liabilities corresponds usually to the nominal value. Deferred income Deferred income include payments received from costumers to be recognised as income in subsequent years. Foreign currency translation Transactions in foreign currencies are translated at the rate of exchange on the transaction date. Exchange differences arising between the rate on the transaction date and the rate on the payment date are recognised in the Income Statement as a financial income or expense. Receivables, payables and other monetary items in foreign currencies that are not settled on the Balance Sheet date are translated at the exchange rate on the Balance Sheet date. The difference between the exchange rate on the Balance Sheet date and the exchange rate at the date when the receivables or payables come into existence recognised in the Income Statement as financial income or expenses. 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