Årsrapport 30700228 EY Godkendt Revisionspartnerselskab Dirch Passers Allé 36 Postboks 250, 2000 Frederiksberg 2023-01-01 2023-12-31 2021-12-07 2022-12-31 42886866 Kiox Pharmaceuticals ApS Stolbjergvej 26C 3070 Snekkersten 2021-12-07 Snekkersten Danske Bank EY Godkendt Revisionspartnerselskab 30700228 Dirch Passers Allé 36 2000 Frederiksberg 2024-06-28 Mikkel Walmar Regnskabsklasse B Andre erklæringer uden sikkerhed true true 2024-06-28 2024-06-28 CaseWare Working Papers Copenhagen Mikkel Walmar Copenhagen Anders Roe Eriksen State Authorised Public Accountant mne46667 573554 0 161441 2632 412113 -2632 1651580 0 -1239467 -2632 2477 0 5309 255 -1242299 -2887 -273306 0 -968993 -2887 -968993 -2887 0 20000 273306 0 359552 0 632858 20000 172130 17113 804988 37113 804988 37113 208000 40000 -271880 -2887 -63880 37113 868868 0 868868 0 868868 0 804988 37113 0 0 -2887 40000 0 40000 -2887 168000 0 -968993 700000 208000 -271880 573554 0 2477 0 0 255 5309 0 -273306 0 322996 0 36556 0 359552 0 208000 A 208000 40000 40000 0 40000 Today, the Executive Board has discussed and approved the annual report of Kiox Pharmaceuticals ApS for the financial year 1 January - 31 December 2023. The annual report, which has not been audited, has been prepared in accordance with the provisions of the Danish Financial Statements Act. The Executive Board has considered the criteria for omission of audit to be met. In my opinion, the financial statements give a true and fair view of the 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. Further, in my opinion, the Management's review gives a fair review of the matters discussed in the Management's review. I recommend that the annual report be approved at the annual general meeting. To the general management of Kiox Pharmaceuticals ApS We have compiled the financial statements of Kiox Pharmaceuticals ApS for the financial year 1 January - 31 December 2023 based on the Company's bookkeeping and other information provided. The financial statements comprise an income statement, balance sheet, statement of changes in equity and notes, including accounting policies. We performed this compilation engagement in accordance with ISRS 4410 Compilation Engagements. We have applied our expertise in accounting and financial reporting to assist you in the preparation and presentation of the financial statements in accordance with the Danish Financial Statements Act. We have complied with relevant requirements in the Danish Auditors Act and International Ethics Standards Board for Professional Accountants' International Code of Ethics for Professional Accountants (IESBA Code), including principles of integrity, objectivity, professional competence and due care. The financial statements and the accuracy and completeness of the information used to compile the financial statements are your responsibility. Since a compilation engagement is not an assurance engagement, we are not required to verify the accuracy or completeness of the information you provided to us to compile the financial statements. Accordingly, we do not express an audit opinion or a review conclusion on whether the financial statements are prepared in accordance with the Danish Financial Statements Act. The Company is a biotech Company incorporated in December 2021 focusing on development of inhaled treatments for interstitial lung diseases. New shares have been subscribed, DKK 168 thousand and paid-in during the financial year, but registration with the Danish Authorities has taken place after the balance sheet date, in 2024. During 2023, the Company has received tax free group contributions from the controlling shareholder which amounts to DKK 700 thousand. Further, in 2023, the Company received grants under the Innobooster program from Innovationsfonden, reference is made to note 3. The income statement for 2023 shows a loss of DKK 968,993 against a loss of DKK 2,887 last year, and the balance sheet at 31 December 2023 shows a negative equity of DKK 63,880. The Company has lost more than 50% of its share capital. Management expects to reestablish the share capital through future share capital injections in combination with convertible loans as deemed necessary. Please also see information included under Events after the balance sheet date and the notes to the annual report. Subsequent to the financial year-end, the Company completed new capital increases which amounted to DKK 2,122 thousand, which enables the Company to initiate further R&D activities in 2024. No events materially affecting the Company's financial position have occurred subsequent to the financial year-end. The Company has lost more than 50% of its share capital. Management expects to reestablish the share capital through future share capital injections in combination with convertible loans as deemed necessary. See also note 2 for capital injections after the balance sheet date. New shares have been subscribed, DKK 168 thousand and paid-in during the financial year, but registration with the Danish Authorities has taken place after the balance sheet date, in 2024. During 2023, the Company has received tax free group contributions from the controlling shareholder which amounts to DKK 700 thousand. The annual report of Kiox Pharmaceuticals ApS for 2023 has been prepared in accordance with the provisions in the Danish Financial Statements Act applying to reporting class B entities and elective choice of certain provisions applying to reporting class C entities. The accounting policies used in the preparation of the financial statements are consistent with those of last year. Reporting currency The financial statements are presented in Danish kroner (DKK). On initial recognition, transactions denominated in foreign currencies are translated at the exchange rate at the transaction date. Foreign exchange differences arising between the exchange rates at the transaction date and the date of payment are recognised in the income statement as financial income or financial expenses. Receivables and payables and other monetary items denominated in foreign currencies are translated at the exchange rate 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 recognised in the most recent financial statements is recognised in the income statement as financial income or financial expenses. Other operating income comprise items of a secondary nature relative to the Company's core activities, including gains on the sale of fixed assets. Government grants are recognized periodically when the work supported by the grant has been reported and presented as other operating income. Government grants are recognized when a final and firm right to the grant has been obtained. Government grants are recognised in the income statement in the same period as the work (external expenses) has been performed as the grants areconsidered to be reimbursement of research expenses. The item includes research costs that do not qualify for capitalisation as well as amortisation of capitalised development costs. Other external expenses include the year's expenses relating to the Company's core activities, including administration expenses to the bank. Financial income and expenses are recognised in the income statements at the amounts that concern the financial year. Net financials include interest income and expenses as well as allowances and surcharges under the advance-payment-of-tax scheme, etc. Tax for the year includes current tax on the year's expected taxable income and the year's deferred tax adjustments. The portion of the tax for the year that relates to the profit/loss for the year is recognised in the income statement, whereas the portion that relates to transactions taken to equity is recognised in equity. The entity is jointly taxed with other group entities. The total Danish income tax charge is allocated between profit/loss-making Danish entities in proportion to their taxable income (full absorption). Jointly taxed entities entitled to a tax refund are reimbursed by the management company based on the rates applicable to interest allowances, and jointly taxed entities which have paid too little tax pay a surcharge according to the rates applicable to interest surcharges to the management company. Income tax of the year include refundable tax credits for costs incurred in connection with research and development activities under the Danish Tax Credit Regime. The Company has chosen IAS 39 as interpretation for impairment write-down of financial receivables. Receivables are measured at amortised cost. An impairment loss is recognised if there is objective evidence that a receivable or a group of receivables is impaired. If there is objective evidence that an individual receivable has been impaired, an impairment loss is recognised on an individual basis. Impairment losses are calculated as the difference between the carrying amount of the receivables and the present value of the expected cash flows, including the realisable value of any collateral received. The effective interest rate for the individual receivable or portfolio is used as discount rate. Cash comprise bank accounts in DKK which minimal risk of changes to credit risk. Current tax payables and receivables are recognised in the balance sheet as the estimated income tax charge for the year, adjusted for prior-year taxes and tax paid on account. Deferred tax is measured according to the liability method on all temporary differences between the carrying amount and the tax base of assets and liabilities. However, deferred tax is not recognised on temporary differences relating to goodwill which is not deductible for tax purposes and on office premises and other items where temporary differences, apart from business combinations, arise at the date of acquisition without affecting either profit/loss for the year or taxable income. 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. Deferred tax is measured according to the tax rules and at the tax rates applicable at the balance sheet date when the deferred tax is expected to crystallise as current tax. Deferred tax assets are recognised at the expected value of their utilisation; 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. Changes in deferred tax due to changes in the tax rate are recognised in the income statement. The Company has chosen IAS 39 as interpretation for liabilities. Financial liabilities are recognised at the date of borrowing at the net proceeds received less transaction costs paid. On subsequent recognition, financial liabilities are measured at amortised cost, corresponding to the capitalised value, using the effective interest rate. Accordingly, the difference between the proceeds and the nominal value is recognised in the income statement over the term of the loan. Financial liabilities also include the capitalised residual lease liability in respect of finance leases. Other liabilities are measured at net realisable value. Subsequent to the financial year-end, the Company completed new capital increases which amounted to DKK 2,122 thousand, which enables the Company to initiate further R&D activities in 2024. No events materially affecting the Company's financial position have occurred subsequent to the financial year-end. Other operating income includes grants under the Innobooster program from Innovationsfonden. Estimated tax for the year comprises recognised tax credits for the income year with reference to LL § 8X regarding tax credits for research and development expenditures. New shares have been subscribed, DKK 168 thousand and paid-in during the financial year, but registration with the Danish Authorities has taken place after the balance sheet date, in 2024. At 31 December 2023, the Company holds a deferred tax related to tax loss carry-forwards. As it is uncertain if these tax losses can be utilised within a foreseeable future, their carrying amount has not been recognised in the financial statements. The Company is jointly taxed with its parent company, 26c Holding ApS, which acts as management company, and has limited and alternative liability together with other jointly taxed group entities for payment of income taxes for income year 2021 onwards as well as withholding taxes on interest, royalties and dividends falling due for payment on or after 7 December 2021. The Company has not provided any security or other collateral in assets at 31 December 2023. Parties exercising control Related party Domicile Basis for control 26c Holding ApS (parent company) Stolbjergvej 26C 3070 Snekkersten Participating interest Significant influence Related party Domicile Basis for significant influence Titi14 HOLDING ApS Stjerneborg Alle 11, 1. 2870 Dyssegård Shares 42886866 2023-01-01 2023-12-31 42886866 2021-12-07 2022-12-31 42886866 2022-12-31 42886866 2023-12-31 42886866 2023-12-31 1 42886866 2023-01-01 2023-12-31 1 42886866 2023-01-01 2023-12-31 1 42886866 2021-12-07 e:ContributedCapitalMember 42886866 2021-12-07 2022-12-31 e:ContributedCapitalMember 42886866 2023-01-01 e:ContributedCapitalMember 42886866 2023-01-01 2023-12-31 e:ContributedCapitalMember 42886866 2023-12-31 e:ContributedCapitalMember 42886866 2023-01-01 e:RetainedEarningsMember 42886866 2023-01-01 2023-12-31 e:RetainedEarningsMember 42886866 2023-12-31 e:RetainedEarningsMember 42886866 2021-12-07 e:RetainedEarningsMember 42886866 2021-12-07 2022-12-31 e:RetainedEarningsMember 42886866 2022-12-31 e:ContributedCapitalMember 42886866 2023-01-01 2023-12-31 1 42886866 2021-12-07 2022-12-31 1 42886866 2022-12-31 1 xbrli:shares iso4217:DKK