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iso4217:DKK
xbrli:pure
SBS Friction A/S
Kuopiovej 11,
5700 Svendborg
Årsrapport
2025-03-10
Rasmus laasby Eshøj
19751937
33883889
XBRL Takeoff ApS
Ole Larsensvej 1
2670 Greve
2024-01-01
2024-12-31
2023-01-01
2023-12-31
<p class="title">Statement by Management</p>
<p>The Board of Directors and the Executive Board have today discussed and approved the annual report of SBS Friction A/S for the financial year 1 January – 31 December 2024.</p>
<p>The annual report has been prepared in accordance with the Danish Financial Statements Act. </p>
<p>In our opinion, the financial statements give a true and fair view of the financial position of the Company at 31 December 2024 and of the results of its operations for the financial year 1 January – 31 December 2024.</p>
<p>Further, in our opinion, the Management's review gives a fair review of the development in the Company's operations and financial matters, the results for the year and the Company's financial position.</p>
<p>We recommend that the annual report is approved at the annual general meeting.</p>
<p>Svendborg,10. February 2025</p>
<p>Executive Board:</p>
<p> </p>
Martin Rambusch
Rasmus Laasby Eshøj
Hans Torben Madsen
Christel Munk Pedersen
Esben Juul Sørensen
Andrea Paganessi
Andrea Pazzi
Martin Rambusch
Esben Juul Sørensen
Gitte Dehn Lansner
<p class="title">Accounting policies</p>
<p>The annual report of SBS Friction A/S for 2024 has been prepared in accordance with the provisions applying to medium-sized reporting class C entities under the Danish Financial Statements Act.</p>
<p>The annual report is prepared consistently with the accounting principles applied last year.</p>
<p class="title">Foreign currency translation</p>
<p>On initial recognition, transactions denominated in foreign currencies are translated at the exchange rates at the transaction date. Foreign exchange differences arising between the exchange rate at the transaction date and the rate at the date of payment are recognized in the income statement as financial income or financial expenses.</p>
<p>Receivables, 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 the date at which the receivable or payable arose or was recognized in the latest financial statements is recognized in the income statement as financial income or financial expenses.</p>
<p> </p>
<p class="title">Basis of recognition and measurement</p>
<p>Income is recognised in the income statement as earned, including value adjustments of financial assets and liabilities. All expenses, including depreciation, amortisation, impairment losses and write-downs, are also recognised in the income statement.</p>
<p>Assets are recognised in the balance sheet when it is probable that future economic benefits will flow to the company, and the value of such assets can be measured reliably. Liabilities are recognised in the balance sheet when it is probable that future economic benefits will flow from the company, and the value of such liabilities can be measured reliably. On initial recognition, assets and liabilities are measured at cost. Subsequently, assets and liabilities are measured as described for each item below.</p>
<p>On recognition and measurement, account is taken of foreseeable losses and risks arising before the date at which the annual report is presented and proving or disproving matters arising on or before the balance sheet date.</p>
<p> </p>
<table class="clob table-col">
<tr><td class="title">Income statement</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Gross profit</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Gross profit is the sum of revenues, work on own account recognized in assets, cost of goods sold, other operating income and other external expenses with reference to the Danish Financial Statement Act (32).</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Own work capitalized</td><td class="title"> </td><td class="title"> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Own work capitalized comprises staff costs and other costs incurred in the financial year and recognized in cost for proprietary intangible assets and property, plant and equipment.</td><td class="title"> </td><td class="title"> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Revenue</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The Company has chosen IFRS 15 as interpretation for revenue recognition.</td><td class="title"> </td><td class="title"> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Revenue from the sales of finished goods and goods for resale is recognized when control of the goods has transferred, being when the goods are delivered to the customer, the customer has full discretion over the channel and price to sell the goods, and there is no unfulfilled obligation that could affect the customers acceptance of the goods. Delivery occurs when the goods have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the goods in accordance with the sales contract, the acceptance provisions have lapsed, or the company has objective evidence that all criteria for acceptance have been satisfied</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cost of raw materials and consumables </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Costs of raw materials and consumables comprise raw materials and consumables used for the year as well as any changes in inventories, including any inventory wastage.</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Write-downs of inventories of raw materials and consumables are also recognised under raw materials and consumables to the extent that these do not exceed normal write-downs.</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Other operating income/expenses </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Other operating income</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Other operating income comprises items secondary to the Company's activities, including gains and losses on disposal of property, plant and equipment and government compensations related to Covid-19.</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Other external expenses</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Other external costs comprises costs relating to the Company’s primary activity that are incurring during the year, including costs for distribution, sales and marketing, administration, premises and bad debts, etc. </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Staff costs</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Staff costs comprise wages and salaries, including holiday pay and pensions as well as expenses regarding social security etc. for the Company’s staff. Compensations received from authorities are recognized in gross profit. </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Depreciation and amortisation of intangible and tangible assets and leases</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Intangible assets</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Depreciation is based on cost less any residual value and provided on a straight-line basis over the expected useful lives of the assets. The expected useful lives are as follows:</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title"> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Acquired intangible assets</td><td> </td><td> </td><td> </td><td> </td><td>3-10 years</td></tr>
<tr><td>Goodwill</td><td> </td><td> </td><td> </td><td> </td><td>3-10 years</td></tr>
<tr><td>Completed development projects</td><td> </td><td> </td><td> </td><td> </td><td>5 years</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The depreciation period for intangible assets exceeds 5 years based on assessment of the products long-term market potential. </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Tangible assets</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Depreciation is based on cost less any residual value and provided on a straight-line basis over the expected useful lives of the assets. The expected useful lives are as follows:</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Land and buildings</td><td class="title"> </td><td class="title"> </td><td> </td><td> </td><td> 10-33 years</td></tr>
<tr><td>Plant and machinery</td><td> </td><td> </td><td> </td><td> </td><td> 3-10 years</td></tr>
<tr><td>Fixtures and fittings, tools and equipment</td><td> </td><td> </td><td> </td><td> </td><td> 3-10 years</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Lease</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Leased assets are depreciated on a straight line basis over the expected lease term, which is: </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cars</td><td> </td><td> </td><td> </td><td> </td><td>1-5 years</td></tr>
<tr><td>Building</td><td> </td><td> </td><td> </td><td> </td><td>10 years</td></tr>
<tr><td>Plant and machinery</td><td> </td><td> </td><td> </td><td> </td><td>3-5 years</td></tr>
<tr><td> </td><td class="title"> </td><td class="title"> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Financial income and expenses</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Financial income and expenses comprise interest income and expense, charges in respect of finance leases, 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.</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Interest expense and other borrowing costs to finance intangible assets and property, plant and equipment and which relate to the production period are not recognized in cost of the assets.</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Tax for the year</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
</table>
<table class="clob table-col">
<tr><td class="title">Balance sheet</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Intangible assets</td><td class="title"> </td><td class="title"> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Acquired intangible assets comprise knowhow, trademarks and software are measured at cost less accumulated depreciation and impairment losses.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Goodwill is measured at cost less accumulated depreciation and impairment losses.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Development costs comprise expenses, salaries and depreciation and amortisation directly attributable to the Company's development activities.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Development projects that are clearly defined and identifiable and where the technical feasibility, sufficient resources and a potential future market or development potential are evidenced, and where the Company intends to produce, market or use the project, are recognized as intangible assets provided that the cost can be measured reliably and that there is sufficient assurance that future earnings can cover production costs, selling costs, administrative expenses and development costs. Other development costs are recognized in the income statement as incurred.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Development costs recognized in the balance sheet are measured at cost on initial recognition and subsequently at cost less accumulated amortisation and impairment losses.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>On completion of a development project, development costs are depreciated on a straight-line basis over the estimated useful life, which is usually 5 years and no longer than 10 years..</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Gains and losses on the disposal of development projects, patents and licences are determined as the difference between the selling price less selling costs and the carrying amount at the date of disposal. Gains and losses are recognized in the income statement as other operating income or other operating expenses, respectively.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Tangible assets</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Land and buildings, plant and machinery and fixtures and fittings, tools and equipment are measured at cost less accumulated depreciation and impairment losses. The basis of depreciation is cost less any expected residual value at the end of the useful life. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cost comprises the purchase price and any costs directly attributable to the acquisition until the date when the asset is available for use. The cost of self-constructed assets comprises direct and indirect costs of materials, components, sub-suppliers, wages and salaries as well as borrowing costs relating to specific and general borrowing directly attributable to the construction of the individual asset.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Individual components of property, plant and equipment that have different useful lives are accounted for as separate items, which are depreciated separately.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Depreciation is based on the residual value of the asset and is reduced by impairment losses, if any. The depreciation period and the residual value are determined at the acquisition date and are reassessed annually. Where the residual value exceeds the carrying amount of the asset, no further depreciation charges are recognized.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>In case of changes in the depreciation period or the residual value, the effect on the depreciation charges is recognized prospectively as a change in accounting estimates.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Gains and losses on the disposal of items of property, plant and equipment are calculated as the difference between the selling price less selling costs and the carrying amount at the date of disposal. Gains and losses are recognized in the income statement as other operating income or other operating expenses, respectively. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Leases</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The Company has chosen IFRS 16 as interpretation for classification and recognition of leases. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>On initial recognition, leases for assets with a term of more than 12 months, that transfer substantially all the risks and rewards incident to ownership to the Company (finance leases) are measured in the balance sheet at the lower of fair value and the present value of future lease payments. In calculating the present value, 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 accounted for as the Company's other assets.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The capitalized residual lease commitment is recognized in the balance sheet as a liability, and the interest element of the lease payment is recognized in the income statement over the term of the lease.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Impairment of non-current assets</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The carrying amount of intangible assets, property, plant and equipment and equity investments in subsidiaries and associates is tested annually for indication of impairment other than the decrease in value reflected by amortisation/depreciation.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Impairment tests are conducted on individual assets or cash-generating units when there is indication of impairment. Write-down is made to the lower of the carrying amount and the recoverable amount.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>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.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Previously recognized impairment losses are reversed when the reason for recognition no longer exists. Impairment losses on goodwill are not reversed.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Inventories</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Inventories are measured at cost in accordance with the FIFO method. Where the net realizable value is lower than cost, inventories are written down to this lower value.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Goods for resale and raw materials and consumables are measured at cost, comprising purchase price plus delivery costs.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Finished goods and work in progress are measured at cost, comprising the cost of raw materials, consumables, direct wages and salaries as well as indirect production overheads. Production overheads comprise costs of material and labour as well as maintenance of and depreciation on production machinery, buildings and equipment as well as costs relating to plant administration and management. Borrowing costs are not recognized in the cost.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The net realizable value of inventories is determined as the selling price less costs of completion and costs incurred to effect the sale, taking into account marketability, obsolescence and developments in the expected selling price.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Receivables</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The company has chosen IAS 39 as interpretation. Receivables are measured at amortised cost. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Write-down for bad and doubtful debts is made when there is objective evidence that a receivable has been impaired. If there is objective evidence that an individual receivable has been impaired, an impairment loss is recognized on an individual basis.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>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 of the individual receivable or portfolio is used as discount rate. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The company is part in the group Cash Pool arrangement. Receivables from the Cash Pool arrangement is included in Receivables from group entities. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Prepayments</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Prepayments comprise costs incurred concerning subsequent financial years.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Equity </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Reserve for development costs</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The reserve for development costs comprises recognized development costs. The reserve cannot be used to distribute dividend or cover losses. The reserve will be reduced or dissolved if the recognized development costs are amortized or are no longer part of the Company's operations by a transfer directly to the distributable reserves under equity.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Dividend</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Proposed dividend is recognized as a liability at the date when it is adopted at the annual general meeting (declaration date). Dividend expected to be distributed for the year is presented as a separate line item in equity.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Corporation tax and deferred tax</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Current tax payables and receivables are recognized in the balance sheet as tax computed on the taxable income for the year, adjusted for tax on taxable income in previous years and tax paid on account.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Joint taxation contributions payable and receivable are recognized in the balance sheet as corporation tax receivable or corporation tax payable.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Deferred tax is measured using the balance sheet liability method on all temporary differences between the carrying amount and the tax base of assets and liabilities. Where alternative tax rules can be applied to determine the tax base, deferred tax is measured based on Management's intended use of the asset or settlement of the liability, respectively.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Deferred tax assets, including the tax value of tax loss carryforwards, are recognized at the expected value of their utilization; 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 and jurisdiction.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Deferred tax is measured according to the tax rules and at the tax rates applicable in the respective countries at the balance sheet date when the deferred tax is expected to crystallise as current tax.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Deferred income</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Deferred income comprises received for recognition in subsequent years. Deferred income is measured at cost.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Liabilities other than provisions</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Financial liabilities are recognized at the date of borrowing at the proceeds received less transaction costs paid. On subsequent recognition, financial liabilities are measured at amortized cost, corresponding to the capitalized value, using the effective interest rate. Accordingly, the difference between the proceeds and the nominal value is recognized in the income statement over the term of the loan.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Other liabilities are measured at net realisable value.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Key figures</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The financial ratios are calculated in accordance with the Danish Finance Society's guidelines on the calculation of financial ratios, "Recommendations and Financial Ratios". </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Explanations of financial ratios:</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Liquidity ratio</td><td> </td><td> </td><td> </td><td>Current assets x 100/Current liabilities </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Solvency ratio</td><td> </td><td> </td><td> </td><td>Equity at year end x 100/ Total assets at year end </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Cash flow statement</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The cash flow statement shows cash flows from operating, investing and financing activities, and cash and cash equivalents at the beginning and the end of the financial year.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cash flows from operating activities are presented using the indirect method and calculated as the operating profit/loss adjusted for non-cash operating items, working capital changes, and financial income, financial expenses and income tax paid.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cash flows from investing activities comprise payments in connection with acquisition and divestment of enterprises, activities and fixed asset investments, and purchase, development, improvement and sale, etc. of intangible assets and property, plant and equipment.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cash flows from financing activities comprise changes in the size or composition of the contributed capital and related costs, and the raising of loans, repayments of interest-bearing debt, including lease liabilities, purchase of treasury shares and payment of dividend.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cash and cash equivalents comprise cash and short-term securities with an insignificant price risk.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
</table>
Regnskabsklasse B
971000
548000
<table class="clob table-col graycolumn">
<tr><td class="title">Deferred tax asset</td><td> </td><td> </td></tr>
<tr><td class="title">DKK'000</td><td style="text-align: right" class="title">2.024</td><td style="text-align: right" class="title">2.023</td></tr>
<tr><td> </td><td class="title"> </td><td class="title"> </td></tr>
<tr><td>Deferred tax at 1. januar </td><td style="text-align: right">19.887</td><td style="text-align: right">21.409</td></tr>
<tr><td>Deferred tax adjustment for the year</td><td style="text-align: right">-914</td><td style="text-align: right">-705</td></tr>
<tr><td>Deferred tax adjustment previous years</td><td style="text-align: right">0</td><td style="text-align: right">-817</td></tr>
<tr><td> </td><td class="title"> </td><td class="title"> </td></tr>
<tr><td class="title">Deferred tax at 31 December 2024</td><td style="text-align: right" class="title">18.973</td><td style="text-align: right" class="title">19.887</td></tr>
<tr><td> </td><td class="title"> </td><td class="title"> </td></tr>
<tr><td>Deferred tax relates to: </td><td> </td><td> </td></tr>
<tr><td>Intangible assets</td><td style="text-align: right">-805</td><td style="text-align: right">436</td></tr>
<tr><td>Tangible assets</td><td style="text-align: right">15.331</td><td style="text-align: right">14.169</td></tr>
<tr><td>Tax losses</td><td style="text-align: right">4.447</td><td style="text-align: right">5.282</td></tr>
<tr><td> </td><td class="title"> </td><td class="title"> </td></tr>
<tr><td class="title">Deferred tax at 31 December 2024</td><td style="text-align: right" class="title">18.973</td><td style="text-align: right" class="title">19.887</td></tr>
<tr><td> </td><td> </td><td> </td></tr>
<tr><td>The deferred tax assets are recognized on the basis of expectations to the result of the coming years based on the company’s 5 years plan in which the group entities are expected to substitute the sourcing of brake pads for the OE segment from current suppliers to SBS Friction A/S. As a result of this SBS Friction A/S’s yearly net sales is expected increased with 58% contributing to a significant higher profitability. The increase in sales requires the company to expand production capacity and new investments of approx. DKK 150 million are included in the business plan.</td><td> </td><td> </td></tr>
<tr><td>The tax assets are expected utilized within the next 5 years.</td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td></tr>
</table>
<table class="clob table-col">
<tr><td class="title">Share capital</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Movements in the share capital during the last 5 years can be specified as following: </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">DKK'000</td><td style="text-align: right" class="title">204</td><td style="text-align: right" class="title">2.023</td><td style="text-align: right" class="title">2.022</td><td style="text-align: right" class="title">2.021</td><td style="text-align: right" class="title">2.020</td></tr>
<tr><td> </td><td class="title"> </td><td class="title"> </td><td class="title"> </td><td class="title"> </td><td class="title"> </td></tr>
<tr><td>Share capital at 1 January</td><td style="text-align: right">12.001</td><td style="text-align: right">12.001</td><td style="text-align: right">12.001</td><td style="text-align: right">12.001</td><td style="text-align: right">12.000</td></tr>
<tr><td>Additions</td><td style="text-align: right">0</td><td style="text-align: right">0</td><td style="text-align: right">0</td><td style="text-align: right">0</td><td style="text-align: right">1</td></tr>
<tr><td> </td><td class="title"> </td><td class="title"> </td><td class="title"> </td><td class="title"> </td><td class="title"> </td></tr>
<tr><td class="title">Share capital at 31 December</td><td style="text-align: right" class="title">12.001</td><td style="text-align: right" class="title">12.001</td><td style="text-align: right" class="title">12.001</td><td style="text-align: right" class="title">12.001</td><td style="text-align: right" class="title">12.001</td></tr>
</table>
<p class="title">Contractual obligations and contingencies, etc.</p>
<p class="title">Operating lease commitments</p>
<p>The Company has no operating leases, that are not recognized in the balance sheet. </p>
<p class="title">Contractual obligations</p>
<p>The Company has signed contracts for delivery of production machinery in 2025 for DKK 10,0 million. </p>
<table class="clob table-col">
<tr><td>Related parties</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>SBS Friction A/S' related parties comprise the following:</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Control</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Brembo N.V., Via Stezzano 87, 24126 Bergamo, Italy with registered address in Amsterdam (NL) owns 60% of the share capital and 40% is owned by Brembo Brake India, which is 100% owned by Brembo N.V. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>SBS Friction A/S is part of the Brembo Group, domiciled in Bergamo, Italy and listed on the Italian stock exchange. The consolidated financial statements of Brembo Group can be obtained on the webpage http://www.brembo.com.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Related party transactions</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>SBS Friction A/S was engaged in the below related party transactions. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>DKK'000</td><td style="text-align: right">2.024</td><td style="text-align: right">2.023</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Sale of goods to group entities</td><td style="text-align: right">91.761</td><td style="text-align: right">82.867</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Sale of services to group entities</td><td style="text-align: right">183</td><td style="text-align: right">860</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Purchase of goods from group entities</td><td style="text-align: right">184</td><td style="text-align: right">401</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Purchase of services from group entities</td><td style="text-align: right">6.562</td><td style="text-align: right">5.388</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Interest received</td><td style="text-align: right">0</td><td style="text-align: right">1</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Interest paid</td><td style="text-align: right">2.425</td><td style="text-align: right">3.642</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Receivables</td><td style="text-align: right">30.658</td><td style="text-align: right">11.930</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Payables short term</td><td style="text-align: right">59.642</td><td style="text-align: right">111.225</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
</table>
<table class="clob table-col">
<tr><td>Cash flow statement</td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>DKK'000</td><td> </td><td style="text-align: right">2.024</td><td style="text-align: right">2.023</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Operating profit</td><td class="title"> </td><td style="text-align: right" class="title">6.958</td><td style="text-align: right" class="title">4.624</td></tr>
<tr><td>Reversed depreciations charges etc.</td><td> </td><td style="text-align: right">18.905</td><td style="text-align: right">15.509</td></tr>
<tr><td>Interests received</td><td> </td><td style="text-align: right">89</td><td style="text-align: right">93</td></tr>
<tr><td>Interests paid</td><td> </td><td style="text-align: right">-6.127</td><td style="text-align: right">-4.379</td></tr>
<tr><td>Changes in working capital </td><td> </td><td style="text-align: right">-68.659</td><td style="text-align: right">20.934</td></tr>
<tr><td>Income taxes paid </td><td> </td><td style="text-align: right">915</td><td style="text-align: right">817</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Cash from operating activities</td><td class="title"> </td><td style="text-align: right" class="title">-47.919</td><td style="text-align: right" class="title">37.598</td></tr>
<tr><td>Acquisition of intangible assets</td><td> </td><td style="text-align: right">-4.511</td><td style="text-align: right">-4.160</td></tr>
<tr><td>Acquisition of property, plant and equipment</td><td> </td><td style="text-align: right">-24.426</td><td style="text-align: right">-34.293</td></tr>
<tr><td>Disposal of property, plant and equipment</td><td> </td><td style="text-align: right">0</td><td style="text-align: right">264</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Cashflow from investing activities</td><td class="title"> </td><td style="text-align: right" class="title">-28.937</td><td style="text-align: right" class="title">-38.189</td></tr>
<tr><td>Loan financing: Changes in loans from group entities</td><td> </td><td style="text-align: right">0</td><td style="text-align: right">3.260</td></tr>
<tr><td>Loan financing: credit institutions</td><td> </td><td style="text-align: right">74.271</td><td style="text-align: right">0</td></tr>
<tr><td>Loan financing: Lease commitments</td><td> </td><td style="text-align: right">-401</td><td style="text-align: right">-371</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Cashflow from financing activities</td><td class="title"> </td><td style="text-align: right" class="title">73.870</td><td style="text-align: right" class="title">2.889</td></tr>
<tr><td class="title"> </td><td class="title"> </td><td class="title"> </td><td class="title"> </td></tr>
<tr><td class="title">Net cash flows</td><td class="title"> </td><td style="text-align: right" class="title">-2.986</td><td style="text-align: right" class="title">2.298</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cash and cash equivalents at January 1</td><td> </td><td style="text-align: right">-6.137</td><td style="text-align: right">-3.839</td></tr>
<tr><td>Cash and cash equivalents at December 31</td><td> </td><td style="text-align: right">3.151</td><td style="text-align: right">6.137</td></tr>
<tr><td>Ændringe</td><td> </td><td style="text-align: right">-2.986</td><td style="text-align: right">2.298</td></tr>
</table>
<p>Deferred income </p>
<p>Deferred income consists of subsidies received in connection with development assets. </p>
<table class="clob table-col graycolumn">
<tr><td class="title">Staff costs</td><td> </td><td> </td></tr>
<tr><td>Wages and Salaries other employees</td><td style="text-align: right">69.246</td><td style="text-align: right">59.741</td></tr>
<tr><td>Pensions</td><td style="text-align: right">5.696</td><td style="text-align: right">4.572</td></tr>
<tr><td>Other social security expenses</td><td style="text-align: right">1.378</td><td style="text-align: right">1.371</td></tr>
<tr><td> </td><td class="title"> </td><td class="title"> </td></tr>
<tr><td class="title"> </td><td style="text-align: right" class="title">76.320</td><td style="text-align: right" class="title">65.684</td></tr>
<tr><td> </td><td class="title"> </td><td class="title"> </td></tr>
<tr><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td class="title"> </td><td class="title"> </td></tr>
<tr><td class="title">Remueration of management</td><td> </td><td> </td></tr>
<tr><td>Executive baord</td><td style="text-align: right">9.915</td><td style="text-align: right">9.646</td></tr>
</table>
<table class="clob table-col">
<tr><td class="title">Statement of changes in equity</td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">DKK'000</td><td class="title">Share capital</td><td class="title">Reserve for development costs</td><td class="title">Retained earnings</td><td class="title">Total</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td class="title"> </td></tr>
<tr><td>Equity at 1 January 2024</td><td style="text-align: right">12.001</td><td style="text-align: right">11.259</td><td style="text-align: right">34.714</td><td style="text-align: right">57.974</td></tr>
<tr><td>Transfer to reserves</td><td style="text-align: right">0</td><td style="text-align: right">-727</td><td style="text-align: right">727</td><td style="text-align: right">0</td></tr>
<tr><td>Profit/loss for the year</td><td style="text-align: right">0</td><td style="text-align: right">0</td><td style="text-align: right">971</td><td style="text-align: right">971</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Equity at 31 December 2024</td><td style="text-align: right" class="title">12.001</td><td style="text-align: right" class="title">10.532</td><td style="text-align: right" class="title">36.412</td><td style="text-align: right" class="title">58.945</td></tr>
</table>
Opinion
<p>We have audited the financial statements of SBS Friction A/S for the financial year 01.01.2024 - 31.12.2024, which comprise the income statement, balance sheet, statement of changes in equity, cash flow statement and notes, including a summary of significant accounting policies. The financial statements are prepared in accordance with the Danish Financial Statements Act.</p>
<p>In our opinion, the financial statements give a true and fair view of the Entity’s financial position at 31.12.2024 and of the results of its operations for the financial year 01.01.2024 - 31.12.2024 in accordance with the Danish Financial Statements Act. </p>
<p class="title"> </p>
Basis for Opinion
<p>We conducted our audit in accordance with International Standards on Auditing (ISAs) and additional requirements applicable in Denmark. Our responsibilities under those standards and requirements are further described in the "Auditor’s responsibilities for the audit of the financial statements" section of this auditor’s report. We are independent of the Entity in accordance with the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (IESBA Code) and the additional ethical requirements applicable in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.</p>
<p> </p>
<p class="title">Management's responsibilities for the financial statements</p>
<p> </p>
<p>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.</p>
<p>In preparing the financial statements, Management is responsible for assessing the Entity’s ability to continue as a going concern, for disclosing, as applicable, matters related to going concern, and for using the going concern basis of accounting in preparing the financial statements unless Management either intends to liquidate the Entity or to cease operations, or has no realistic alternative but to do so.</p>
<p> </p>
<p class="title">Auditor's responsibilities for the audit of the financial statements</p>
<p class="title"> </p>
<p>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.</p>
<p>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:</p>
<p> </p>
<p>·        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.</p>
<p>·        Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Entity’s internal control.</p>
<p>·        Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management.</p>
<p> </p>
<p>·        Conclude on the appropriateness of Management’s use of the going concern basis of accounting inpreparing the financial statements, and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Entity’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required todraw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Entity to cease to continue as a going concern.</p>
<p>·        Evaluate the overall presentation, structure and content of the financial statements, including the disclosures in the notes, and whether the financial statements represent the underlying transactions and events in a manner that gives a true and fair view.</p>
<p class="title"> </p>
<p>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.</p>
<p> </p>
<p class="title">Statement on the Management commentary</p>
<p class="title"> </p>
<p>Management is responsible for the management commentary. </p>
<p>Our opinion on the financial statements does not cover the management commentary, and we do not express any form of assurance conclusion thereon.</p>
<p>In connection with our audit of the financial statements, our responsibility is to read the management commentary and, in doing so, consider whether the management commentary is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. </p>
<p>Moreover, it is our responsibility to consider whether the management commentary provides the information required bt relevant law and regulations.</p>
<p>Based on the work we have performed, we conclude that the management commentary is in accordance with the financial statements and has been prepared in accordance with the requirements of the Danish Financial Statements Act. We did not identify any material misstatement of the management commentary.</p>
<p> </p>
<p class="title">Deloitte</p>
<p>Statsautoriseret Revisionspartnerselskab</p>
33963556
Heino Hyllested Tholsgaard
State Authorised Public Accountant
mne34511
Svendborg
2025-02-10
Revisionspåtegning
12001000
12001000
10532000
11259000
36412000
34714000
58945000
57974000
4290000
4405000
0
918000
247000
162000
74271000
111225000
59642000
255000
258000
20186000
27386000
1090000
975000
10714000
178314000
148955000
237259000
206929000
<table class="clob table-col">
<tr><td class="title bottom-line">DKKm</td><td style="text-align: right" class="title bottom-line">2.022</td><td style="text-align: right" class="title bottom-line">2.022</td><td style="text-align: right" class="title bottom-line">2.022</td><td style="text-align: right" class="title bottom-line">2.021</td><td style="text-align: right" class="title bottom-line">2.020</td></tr>
<tr><td class="title"> </td><td class="title"> </td><td class="title"> </td><td class="title"> </td><td class="title"> </td><td class="title"> </td></tr>
<tr><td class="title">Key figures</td><td class="title"> </td><td class="title"> </td><td class="title"> </td><td class="title"> </td><td class="title"> </td></tr>
<tr><td>Gross profit/loss</td><td style="text-align: right">102.183</td><td style="text-align: right">86.081</td><td style="text-align: right">78.935</td><td style="text-align: right">84.275</td><td style="text-align: right">78.011</td></tr>
<tr><td>Operating profit/loss</td><td style="text-align: right">6.958</td><td style="text-align: right">4.624</td><td style="text-align: right">782</td><td style="text-align: right">9.450</td><td style="text-align: right">19.825</td></tr>
<tr><td>Net financials</td><td style="text-align: right">-6.038</td><td style="text-align: right">-4.286</td><td style="text-align: right">-2.443</td><td style="text-align: right">-4.817</td><td style="text-align: right">-3.067</td></tr>
<tr><td class="title">Profit/loss for the year</td><td style="text-align: right">971</td><td style="text-align: right">548</td><td style="text-align: right">-926</td><td style="text-align: right">3.888</td><td style="text-align: right">13.371</td></tr>
<tr><td class="title"> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Investments in tangible assets</td><td style="text-align: right">24.426</td><td style="text-align: right">34.293</td><td style="text-align: right">28.396</td><td style="text-align: right">7.026</td><td style="text-align: right">34.459</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Total assets</td><td style="text-align: right">237.259</td><td style="text-align: right">206.929</td><td style="text-align: right">193.171</td><td style="text-align: right">197.427</td><td style="text-align: right">156.357</td></tr>
<tr><td>Equity</td><td style="text-align: right">58.945</td><td style="text-align: right">57.975</td><td style="text-align: right">57.426</td><td style="text-align: right">58.352</td><td style="text-align: right">54.464</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Financial ratios</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Liquidity ratio</td><td style="text-align: right">53,2%</td><td style="text-align: right">49,2%</td><td style="text-align: right">183,0%</td><td style="text-align: right">240,6%</td><td style="text-align: right">55,2%</td></tr>
<tr><td>Solvency ratio</td><td style="text-align: right">24,8%</td><td style="text-align: right">28,0%</td><td style="text-align: right">29,7%</td><td style="text-align: right">29,6%</td><td style="text-align: right">34,8%</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Average number of full-time employees</td><td style="text-align: right">109</td><td style="text-align: right">102</td><td style="text-align: right">99</td><td style="text-align: right">93</td><td style="text-align: right">84</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The financial ratios are calculated in accordance with the Danish Finance Society's guidelines on the calculation of financial ratios, "Recommendations and Financial Ratios". For terms and definitions, please see the accounting policies. </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
</table>
1711000
3507000
13502000
14434000
15213000
17941000
33290000
33022000
69937000
53094000
1801000
1945000
5243000
10080000
498000
411000
110769000
98552000
18973000
19887000
144955000
136380000
17906000
17650000
2598000
784000
16282000
20547000
36786000
38981000
14900000
7923000
30658000
11930000
4887000
4122000
965000
915000
957000
541000
52367000
25431000
3151000
6137000
92304000
70549000
237259000
206929000
102183000
86081000
76320000
65684000
-18905000
-15773000
6958000
4624000
89000
93000
-6127000
-4379000
920000
338000
51000
210000
971000
548000
109
102
<table class="clob table-col">
<tr><td class="title">Gross profit</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Gross profit is the sum of revenues, work on own account recognized in assets, cost of goods sold, other operating income and other external expenses with reference to the Danish Financial Statement Act (32).</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Own work capitalized</td><td class="title"> </td><td class="title"> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Own work capitalized comprises staff costs and other costs incurred in the financial year and recognized in cost for proprietary intangible assets and property, plant and equipment.</td><td class="title"> </td><td class="title"> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Revenue</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The Company has chosen IFRS 15 as interpretation for revenue recognition.</td><td class="title"> </td><td class="title"> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Revenue from the sales of finished goods and goods for resale is recognized when control of the goods has transferred, being when the goods are delivered to the customer, the customer has full discretion over the channel and price to sell the goods, and there is no unfulfilled obligation that could affect the customers acceptance of the goods. Delivery occurs when the goods have been shipped to the specific location, the risks of obsolescence and loss have been transferred to the customer, and either the customer has accepted the goods in accordance with the sales contract, the acceptance provisions have lapsed, or the company has objective evidence that all criteria for acceptance have been satisfied</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cost of raw materials and consumables </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Costs of raw materials and consumables comprise raw materials and consumables used for the year as well as any changes in inventories, including any inventory wastage.</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Write-downs of inventories of raw materials and consumables are also recognised under raw materials and consumables to the extent that these do not exceed normal write-downs.</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Other operating income/expenses </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Other operating income</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Other operating income comprises items secondary to the Company's activities, including gains and losses on disposal of property, plant and equipment and government compensations related to Covid-19.</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Other external expenses</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Other external costs comprises costs relating to the Company’s primary activity that are incurring during the year, including costs for distribution, sales and marketing, administration, premises and bad debts, etc. </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Staff costs</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Staff costs comprise wages and salaries, including holiday pay and pensions as well as expenses regarding social security etc. for the Company’s staff. Compensations received from authorities are recognized in gross profit. </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Depreciation and amortisation of intangible and tangible assets and leases</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Intangible assets</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Depreciation is based on cost less any residual value and provided on a straight-line basis over the expected useful lives of the assets. The expected useful lives are as follows:</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title"> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Acquired intangible assets</td><td> </td><td> </td><td> </td><td> </td><td>3-10 years</td></tr>
<tr><td>Goodwill</td><td> </td><td> </td><td> </td><td> </td><td>3-10 years</td></tr>
<tr><td>Completed development projects</td><td> </td><td> </td><td> </td><td> </td><td>5 years</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The depreciation period for intangible assets exceeds 5 years based on assessment of the products long-term market potential. </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Tangible assets</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Depreciation is based on cost less any residual value and provided on a straight-line basis over the expected useful lives of the assets. The expected useful lives are as follows:</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Land and buildings</td><td class="title"> </td><td class="title"> </td><td> </td><td> </td><td> 10-33 years</td></tr>
<tr><td>Plant and machinery</td><td> </td><td> </td><td> </td><td> </td><td> 3-10 years</td></tr>
<tr><td>Fixtures and fittings, tools and equipment</td><td> </td><td> </td><td> </td><td> </td><td> 3-10 years</td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Lease</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Leased assets are depreciated on a straight line basis over the expected lease term, which is: </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cars</td><td> </td><td> </td><td> </td><td> </td><td>1-5 years</td></tr>
<tr><td>Building</td><td> </td><td> </td><td> </td><td> </td><td>10 years</td></tr>
<tr><td>Plant and machinery</td><td> </td><td> </td><td> </td><td> </td><td>3-5 years</td></tr>
<tr><td> </td><td class="title"> </td><td class="title"> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Financial income and expenses</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Financial income and expenses comprise interest income and expense, charges in respect of finance leases, 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.</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Interest expense and other borrowing costs to finance intangible assets and property, plant and equipment and which relate to the production period are not recognized in cost of the assets.</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Tax for the year</td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
</table>
<table class="clob table-col">
<tr><td class="title">Balance sheet</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Intangible assets</td><td class="title"> </td><td class="title"> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Acquired intangible assets comprise knowhow, trademarks and software are measured at cost less accumulated depreciation and impairment losses.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Goodwill is measured at cost less accumulated depreciation and impairment losses.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Development costs comprise expenses, salaries and depreciation and amortisation directly attributable to the Company's development activities.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Development projects that are clearly defined and identifiable and where the technical feasibility, sufficient resources and a potential future market or development potential are evidenced, and where the Company intends to produce, market or use the project, are recognized as intangible assets provided that the cost can be measured reliably and that there is sufficient assurance that future earnings can cover production costs, selling costs, administrative expenses and development costs. Other development costs are recognized in the income statement as incurred.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Development costs recognized in the balance sheet are measured at cost on initial recognition and subsequently at cost less accumulated amortisation and impairment losses.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>On completion of a development project, development costs are depreciated on a straight-line basis over the estimated useful life, which is usually 5 years and no longer than 10 years..</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Gains and losses on the disposal of development projects, patents and licences are determined as the difference between the selling price less selling costs and the carrying amount at the date of disposal. Gains and losses are recognized in the income statement as other operating income or other operating expenses, respectively.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Tangible assets</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Land and buildings, plant and machinery and fixtures and fittings, tools and equipment are measured at cost less accumulated depreciation and impairment losses. The basis of depreciation is cost less any expected residual value at the end of the useful life. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cost comprises the purchase price and any costs directly attributable to the acquisition until the date when the asset is available for use. The cost of self-constructed assets comprises direct and indirect costs of materials, components, sub-suppliers, wages and salaries as well as borrowing costs relating to specific and general borrowing directly attributable to the construction of the individual asset.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Individual components of property, plant and equipment that have different useful lives are accounted for as separate items, which are depreciated separately.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Depreciation is based on the residual value of the asset and is reduced by impairment losses, if any. The depreciation period and the residual value are determined at the acquisition date and are reassessed annually. Where the residual value exceeds the carrying amount of the asset, no further depreciation charges are recognized.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>In case of changes in the depreciation period or the residual value, the effect on the depreciation charges is recognized prospectively as a change in accounting estimates.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Gains and losses on the disposal of items of property, plant and equipment are calculated as the difference between the selling price less selling costs and the carrying amount at the date of disposal. Gains and losses are recognized in the income statement as other operating income or other operating expenses, respectively. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Leases</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The Company has chosen IFRS 16 as interpretation for classification and recognition of leases. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>On initial recognition, leases for assets with a term of more than 12 months, that transfer substantially all the risks and rewards incident to ownership to the Company (finance leases) are measured in the balance sheet at the lower of fair value and the present value of future lease payments. In calculating the present value, 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 accounted for as the Company's other assets.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The capitalized residual lease commitment is recognized in the balance sheet as a liability, and the interest element of the lease payment is recognized in the income statement over the term of the lease.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Impairment of non-current assets</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The carrying amount of intangible assets, property, plant and equipment and equity investments in subsidiaries and associates is tested annually for indication of impairment other than the decrease in value reflected by amortisation/depreciation.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Impairment tests are conducted on individual assets or cash-generating units when there is indication of impairment. Write-down is made to the lower of the carrying amount and the recoverable amount.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>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.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Previously recognized impairment losses are reversed when the reason for recognition no longer exists. Impairment losses on goodwill are not reversed.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Inventories</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Inventories are measured at cost in accordance with the FIFO method. Where the net realizable value is lower than cost, inventories are written down to this lower value.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Goods for resale and raw materials and consumables are measured at cost, comprising purchase price plus delivery costs.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Finished goods and work in progress are measured at cost, comprising the cost of raw materials, consumables, direct wages and salaries as well as indirect production overheads. Production overheads comprise costs of material and labour as well as maintenance of and depreciation on production machinery, buildings and equipment as well as costs relating to plant administration and management. Borrowing costs are not recognized in the cost.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The net realizable value of inventories is determined as the selling price less costs of completion and costs incurred to effect the sale, taking into account marketability, obsolescence and developments in the expected selling price.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Receivables</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The company has chosen IAS 39 as interpretation. Receivables are measured at amortised cost. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Write-down for bad and doubtful debts is made when there is objective evidence that a receivable has been impaired. If there is objective evidence that an individual receivable has been impaired, an impairment loss is recognized on an individual basis.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>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 of the individual receivable or portfolio is used as discount rate. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The company is part in the group Cash Pool arrangement. Receivables from the Cash Pool arrangement is included in Receivables from group entities. </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Prepayments</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Prepayments comprise costs incurred concerning subsequent financial years.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Equity </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Reserve for development costs</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The reserve for development costs comprises recognized development costs. The reserve cannot be used to distribute dividend or cover losses. The reserve will be reduced or dissolved if the recognized development costs are amortized or are no longer part of the Company's operations by a transfer directly to the distributable reserves under equity.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Dividend</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Proposed dividend is recognized as a liability at the date when it is adopted at the annual general meeting (declaration date). Dividend expected to be distributed for the year is presented as a separate line item in equity.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Corporation tax and deferred tax</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Current tax payables and receivables are recognized in the balance sheet as tax computed on the taxable income for the year, adjusted for tax on taxable income in previous years and tax paid on account.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Joint taxation contributions payable and receivable are recognized in the balance sheet as corporation tax receivable or corporation tax payable.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Deferred tax is measured using the balance sheet liability method on all temporary differences between the carrying amount and the tax base of assets and liabilities. Where alternative tax rules can be applied to determine the tax base, deferred tax is measured based on Management's intended use of the asset or settlement of the liability, respectively.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Deferred tax assets, including the tax value of tax loss carryforwards, are recognized at the expected value of their utilization; 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 and jurisdiction.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Deferred tax is measured according to the tax rules and at the tax rates applicable in the respective countries at the balance sheet date when the deferred tax is expected to crystallise as current tax.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Deferred income</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Deferred income comprises received for recognition in subsequent years. Deferred income is measured at cost.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Liabilities other than provisions</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Financial liabilities are recognized at the date of borrowing at the proceeds received less transaction costs paid. On subsequent recognition, financial liabilities are measured at amortized cost, corresponding to the capitalized value, using the effective interest rate. Accordingly, the difference between the proceeds and the nominal value is recognized in the income statement over the term of the loan.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Other liabilities are measured at net realisable value.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Key figures</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The financial ratios are calculated in accordance with the Danish Finance Society's guidelines on the calculation of financial ratios, "Recommendations and Financial Ratios". </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Explanations of financial ratios:</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Liquidity ratio</td><td> </td><td> </td><td> </td><td>Current assets x 100/Current liabilities </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Solvency ratio</td><td> </td><td> </td><td> </td><td>Equity at year end x 100/ Total assets at year end </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td class="title">Cash flow statement</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>The cash flow statement shows cash flows from operating, investing and financing activities, and cash and cash equivalents at the beginning and the end of the financial year.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cash flows from operating activities are presented using the indirect method and calculated as the operating profit/loss adjusted for non-cash operating items, working capital changes, and financial income, financial expenses and income tax paid.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cash flows from investing activities comprise payments in connection with acquisition and divestment of enterprises, activities and fixed asset investments, and purchase, development, improvement and sale, etc. of intangible assets and property, plant and equipment.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cash flows from financing activities comprise changes in the size or composition of the contributed capital and related costs, and the raising of loans, repayments of interest-bearing debt, including lease liabilities, purchase of treasury shares and payment of dividend.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td>Cash and cash equivalents comprise cash and short-term securities with an insignificant price risk.</td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
<tr><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td><td> </td></tr>
</table>
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<p class="title">Principal activities</p>
<p>SBS Friction develops, manufactures and distributes brake parts and friction technology for motorcycles, scooters and ATV/UTVs as well as for several specialized areas that apply friction technology.</p>
<p> </p>
<p>The product portfolio includes self-developed and self-produced brake pads as well as goods for resale in the form of brake discs, brake shoes, and clutches.</p>
<p> </p>
<p>SBS Friction controls the main part of the value chain and oversees its own development based on considerable know-how within friction technology, own production, sales, marketing and a product range which lives up to the highest performance requirements, safety and general industry quality properties.</p>
<p>All functions, including packaging and distribution are in Svendborg (Denmark). </p>
<p> </p>
<p>SBS Friction operates globally on the free spare parts market and within the OEM market. The OEM market also includes manufacturers of wind turbines and other niches which use friction technology.</p>
<p> </p>
<p>On the free aftermarket, SBS Friction is market leader within brake pads in Europe where the largest markets are Italy, Germany, France and Spain. In addition, the company has sales in Asia, North and South America. Most of the volume in the aftermarket is sold under Corporate own brands (SBS, AP Racing and Brembo) and the rest as private label products.</p>
<p> </p>
<p>On the OEM market for motorcycles, scooters, UTVs, ATVs and other vehicles, SBS Friction serves vehicle manufacturers through brake system specialists, mainly intercompany. </p>