xbrli:pureiso4217:DKK377737432022-01-012022-12-31377737432022-01-012022-12-311377737432022-01-012022-12-311377737432022-01-012022-12-312377737432022-01-012022-12-311377737432022-01-012022-12-312377737432022-01-012022-12-31377737432021-01-012021-12-31377737432022-01-012022-12-31fsa:RetainedEarningsMember377737432021-01-012021-12-31fsa:RetainedEarningsMember377737432022-01-012022-12-31fsa:ReserveForCurrentValueAdjustmentsOfCurrencyGainsMember377737432022-01-012022-12-31fsa:ReserveForCurrentValueOfHedgingMember377737432022-01-012022-12-31fsa:ReserveForNetRevaluationAccordingToEquityMethodMember377737432022-01-012022-12-31fsa:RetainedEarningsMember377737432022-12-31377737432021-12-31377737432022-01-01fsa:ContributedCapitalMember377737432022-01-01fsa:ReserveForCurrentValueAdjustmentsOfCurrencyGainsMember377737432022-01-01fsa:ReserveForCurrentValueOfHedgingMember377737432022-01-01fsa:ReserveForNetRevaluationAccordingToEquityMethodMember377737432022-01-01fsa:RetainedEarningsMember377737432022-12-31fsa:ContributedCapitalMember377737432022-12-31fsa:ReserveForCurrentValueAdjustmentsOfCurrencyGainsMember377737432022-12-31fsa:ReserveForCurrentValueOfHedgingMember377737432022-12-31fsa:ReserveForNetRevaluationAccordingToEquityMethodMember377737432022-12-31fsa:RetainedEarningsMember377737432022-01-01377737432022-01-012022-12-31fsa:ContributedCapitalMemberGrundlag for konklusionKonklusion2023-07-112023-07-11true339635562021-01-012021-12-31Aarhus C80002City Tower, VærkmestergadeDeloitte Statsautoriseret RevisionspartnerselskabKoldingKolding6000Regnskabsklasse BRevisionspåtegning2022-12-312022-01-01<br /><br />8PlatinvejFrontmatec Group ApS37773743339635562300 København SWeidekampsgade 6Deloitte Statsautoriseret RevisionspartnerselskabÅrsrapportThe Board of Directors and the Executive Board have today considered and approved the annual report of Frontmatec Group ApS for the financial year 01.01.2022 - 31.12.2022.The annual report is presented in accordance with the Danish Financial Statements Act.In our opinion, the financial statements give a true and fair view of the Entity’s financial position at 31.12.2022 and of the results of its operations for the financial year 01.01.2022 - 31.12.2022.We believe that the management commentary contains a fair review of the affairs and conditions referred to therein.We recommend the annual report for adoption at the Annual General Meeting.KoldingAllan Jan Formann KristensenKevin Gerard HarryKevin Gerard HarryAllan Jan Formann KristensenTo the shareholders of Frontmatec Group ApSWe have audited the financial statements of Frontmatec Group ApS for the financial year 01.01.2022 - 31.12.2022, which comprise the income statement, balance sheet, statement of changes in equity and ​notes, including a summary of significant accounting policies. The financial statements are prepared in accordance with the Danish Financial Statements Act. ​ ​In our opinion, the financial statements give a true and fair view of the Entity’s financial position at 31.12.2022 and of the results of its operations for the financial year 01.01.2022 - 31.12.2022 in accordance with the Danish Financial Statements Act.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.Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the Danish Financial Statements Act, and for such internal control as Management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, Management is responsible for assessing the 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.Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:<br />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. <br />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. <br />Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management. <br />Conclude on the appropriateness of Management’s use of the going concern basis of accounting in preparing the financial statements, and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Entity’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Entity to cease to continue as a going concern. <br />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.<br />We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.Management is responsible for the management commentary. Our opinion on the financial statements does not cover the management commentary, and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read 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. Moreover, it is our responsibility to consider whether the management commentary provides the information required under the Danish Financial Statements Act.<br />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.AarhusJacob Tækker Nørgaardmne40049State Authorised Public AccountantPrimary activitiesFrontmatec Group is a global leading provider of advanced food processing equipment. The Group develops world-class customized solutions for automation in the food industry. The Group is especially renowned for the high-quality systems for the entire value chain of the meat industry – from carcass grading to slaughter lines, cutting and deboning lines and control systems to logistics and packaging. Development in activities and financesAs of January 1, 2022 Frontmatec Holding I-III ApS was merged into Frontmatec Group. In 2022 Axcel sold its’ shares in the Frontmatec Group to Bettcher Industries owned by KKR. Bettcher and Frontmatec will continue to operate independently under their existing brands and leadership teams. In January 2022, Frontmatec Group acquired the majority of the shares in Asuan. Asuan deliver innovative and customized solutions to the meat industry in Uruguay. Based in Montevideo, Asuan employs 125 employees and has subsidiaries in Brazil and Mexico. Latin America is a strategically important market to Frontmatec with some of the largest and most respected meat processors in the world. With Asuan joining forces with Frontmatec, the Group will strengthen the position in the Latin American. The Company acquired the last 60 percent of the shares in Aira Robotics SL in May 2022 and now owns all shares in Aira Robotics S.L. Income from associates in 2022 is positively affected by DKK 63.5m due to the revaluation of the cost price of the 40 percent ownership of Aira Robotics SL. Frontmatec Group ApS had a loss of 7.377 tDKK in 2022 compared to a loss of 125.458 t DKK in 2021. The balance sheet, at 31 December 2022 shows total assets of DKK 2.634.962 t DKK (2021: 2.111.827 tDKK) and equity of DKK 1.986.543 t DKK (2021:507.287 tDKK). Events after the balance sheet dateApart from the below signed credit agreement, there have been no subsequent events with material impact on the Company's income statement for 2022 and balance sheet at 31 December 2022. In the period up to the approval of the financial statements, Frontmatec has signed a credit agreement in which the Company also participates. The agreement secures financing for the next few years. 2078200012160000332030001986000012190001593000-13640000-9293000326000004115500069067000117310002061600021028000139243000196464000-30600000-131843000-23223000-6385000-7377000-125458000-7377000-125458000000-737700015380001648000153800016480001177000158300011770001583000223864600018279980000473180002238646000187531600022413610001878547000236164000219443000369540009078000100000100024180002835000275636000231357000117965000192300039360100023328000026349620002111827000100000100000-62000-620000-136100002038400019865050004882260001986543000507287000100000-62000-136100020384000488226000100000-620000019865050005072870005070006940000128758400013133000953000136400001289231000522200000418050000186000480400055710006136290002034760001112400064271000634779000315309000648419000160454000026349620002111827000000681300006813000001475960000147596000001746000001746000000-58818000-588180000-38500000-38500000-203840002038400001 Staff costs2022 DKK'0002021 DKK'000Wages and salaries31,51818,265Pension costs1,6851,59533,20319,860Average number of full-time employees171517152 Other financial income 2022 DKK'0002021 DKK'000Financial income from group enterprises20,32019,501Other financial income2961,52720,61621,0283 Other financial expenses2022 DKK'0002021 DKK'000Financial expenses from group enterprises33,001106,304Other interest expenses0480Other financial expenses106,24289,680139,243196,464<br />2022 DKK'0002021 DKK'000Financial expenses from group enterprises33,001106,304Other interest expenses0480Other financial expenses106,24289,680139,243196,4644 Intangible assetsAcquired intangible assets DKK'000Cost beginning of year5,314Additions834Disposals(231)Cost end of year5,917Amortisation and impairment losses beginning of year(3,667)Amortisation for the year(712)Amortisation and impairment losses end of year(4,379)Carrying amount end of year1,5385 Property, plant and equipmentOther fixtures and fittings, tools and equipment DKK'000Cost beginning of year2,394Additions100Cost end of year2,494Depreciation and impairment losses beginning of year(811)Depreciation for the year(506)Depreciation and impairment losses end of year(1,317)Carrying amount end of year1,1776 Financial assetsInvestments in group enterprises DKK'000Investments in associates DKK'000Cost beginning of year1,973,99926,931Additions446,0500Disposals0(26,931)Cost end of year2,420,0490Revaluations beginning of year020,387Reversal regarding disposals0(20,387)Revaluations end of year00Impairment losses beginning of year(146,001)0Impairment losses for the year(35,402)0Impairment losses end of year(181,403)0Carrying amount end of year2,238,6460Investments in subsidiariesRegistered inCorporate formEquity interest %Equity DKK'000Profit/loss DKK'000Frontmatec Kolding A/S Kolding, DenmarkA/S100.0054,2227,381Frontmatec Smørum A/S Smørum, DenmarkA/S100.0031,9956,859Frontmatec Tandslet A/S Tandslet, DenmarkA/S 100.00105,64214,302Frontmatec Skive A/S Skive, Denmark A/S 100.0046,46317,142Frontmatec Hygiene GmbH Beckum, Germany GmbH 100.0012,54590Frontmatec GmbH Lünen, Germany GmbH 100.0058,77533Accles & Shelvoke, Ltd.Birmingham, United Kingdom Ltd. 100.0066,112686Jining Xinglong Food Machinery Manufacturing Co., Ltd.Xinglong Jining, China Ltd. 100.00(3,019)(12,762)Frontmatec Sibiu SRLSibiu, Romania SRL 100.0017,3873,067Frontmatec - Intecal S.A.U.Barcelona, Spain S.A.U 100.0029,199193AIRA Robotics, S.LCardona, Spain SL 100.0074,7001,627Iltay S.A.Montevideo, Uruguay S.A. 100.0019,197(6,737)7 CashCash amounting to 74.758 t.DKK is deposited in an escrow account. The company cannot dispose of this amount. 8 Non-current liabilities other than provisionsDue within 12 months 2022 DKK'000Due after more than 12 months 2022 DKK'000Outstanding after 5 years 2022 DKK'000Lease liabilities0507896Other payables5,22213,1339,5095,22213,64010,4059 Contingent liabilitiesThe Group's Danish companies are jointly and severally liable for tax on consolidated taxable income etc. The total amount of corporation tax payable is disclosed in the annual report of Merlin DK Bidco Aps, which is the administration company for joint taxation. Furthermore, the Group's Danish companies are jointly and severally liable for Danish withholding taxes on dividends, royalties and interest. Any subsequent changes to corporation taxes and withholding taxes may render the Company liable for a greater amount. 10 Assets charged and collateralThere are no assets charged or collateral. This annual report has been presented in accordance with the provisions of the Danish Financial Statements Act governing reporting class B enterprises with addition of a few provisions for reporting class C.Changes in accounting policiesFrontmatec Group ApS has changed its accounting policies from IFRS to present the annual report in accordance with the provisions og the Danish Financial Statements Act governing reporting class C enterprises (large) according to “Bekendtgørelse om overgang til regnskabsaflæggelse efter årsregnskabsloven” the comparative figures for the fiscal year 2021 has been adapted to Årsregnskabsloven. The main changes relates to disclosures in the annual report. There is only an impact at the financial numbers from the measurement of IFRS 16 Right of Use Assets and special items. The impact on the figures in the annual report is mentioned below. Beside this a reclassification of special items have been made. The reclassification of special items, does not have any impact on the profit of year or equity. The impact on the comparative figures arising from the change of accounting policies from IFRS 16 to Danish Financial Statements Act is as follows for the fiscal year 2021: For 2021 balance sheet total increased by DKK'000 522,099, while equity increased by DKK'000 207. The comparative figures have been restated following the change in accounting policies. Comparative figures for the years 2018, 2019 and 2020 in the key figures and ratios have not been restated according to "Bekendtgørelse om overgang til regnskabsaflæggelse efter årsregnskabsloven" § 4.Consolidated financial statementsReferring to section 112(1) of the Danish Financial Statements Act, no consolidated financial statements have been prepared.Recognition and measurementAssets are recognised in the balance sheet when it is probable as a result of a prior event that future economic benefits will flow to the Entity, and the value of the asset can be measured reliably. Liabilities are recognised in the balance sheet when the Entity has a legal or constructive obligation as a result of a prior event, and it is probable that future economic benefits will flow out of the Entity, and the value of the liability can be measured reliably. On initial recognition, assets and liabilities are measured at cost. Measurement subsequent to initial recognition is effected as described below for each financial statement item. Anticipated risks and losses that arise before the time of presentation of the annual report and that confirm or invalidate affairs and conditions existing at the balance sheet date are considered at recognition and measurement. Income is recognised in the income statement when earned, whereas costs are recognised by the amounts attributable to this financial year.Gross profit or lossGross profit or loss comprises revenue, changes in inventories of finished goods and work in progress, own work capitalised, other operating income, cost of raw materials and consumables and external expenses.Other operating incomeOther operating income comprises income of a secondary nature as viewed in relation to the Entity’s primary activities.Other external expensesOther external expenses include expenses relating to the Entity’s ordinary activities, including expenses for premises, stationery and office supplies, marketing costs, etc. This item also includes writedowns of receivables recognised in current assets.Staff costsStaff costs comprise salaries and wages, and social security contributions, pension contributions, etc . for entity staff.Depreciation, amortisation and impairment lossesDepreciation, amortisation and impairment losses relating to property, plant and equipment and intangible assets comprise depreciation, amortisation and impairment losses for the financial year, and gains and losses from the sale of intangible assets and property, plant and equipment.Income from investments in group enterprisesIncome from investments in group enterprises comprises dividends etc. received from the individual group enterprises in the financial year.<br />Income from investments in associatesIncome from investments in associates comprises dividends etc. received from the individual associates in the financial year.Other financial incomeOther financial income comprises dividends etc. received on other investments, interest income, including interest income on receivables from group enterprises, net capital or exchange gains on securities, payables and transactions in foreign currencies, amortisation of financial assets, and tax relief under the Danish Tax Prepayment Scheme etc.Other financial expensesOther financial expenses comprise interest expenses, including interest expenses on payables to group enterprises, net capital or exchange losses on securities, payables and transactions in foreign currencies, amortisation of financial liabilities, and tax surcharge under the Danish Tax Prepayment Scheme etc.Tax on profit/loss for the yearTax for the year, which consists of current tax for the year and changes in deferred tax, is recognised in the income statement by the portion attributable to the profit for the year and recognised directly in equity by the portion attributable to entries directly in equity.Acquired intangible assetsAcquired intangible assets comprise acquired intellectual property rights.Acquired intangible assets are measured at cost less accumulated amortisation. Patents are amortised on a straight-line basis over their remaining duration, and licences are amortised over the term of the agreement.Acquired intangible assets are written down to the lower of recoverable amount and carrying amount.Other fixtures and fittings, tools and equipmentOther fixtures and fittings, tools and equipment are measured at cost less accumulated depreciation and impairment losses. Cost comprises the acquisition price, costs directly attributable to the acquisition and preparation costs of the asset until the time when it is ready to be put into operation. The basis of depreciation is cost less estimated residual value after the end of useful life. Straight-line depreciation is made on the basis of the following estimated useful lives of the assets:Useful life Other fixtures and fittings, tools and equipment3 - 5 yearsEstimated useful lives and residual values are reassessed annually. Items of equipment are written down to the lower of recoverable amount and carrying amount.Investments in group enterprisesInvestments in group enterprises are measured at cost. Investments are written down to the lower of recoverable amount and carrying amount.<br />Investments in associatesInvestments in associates are recognised and measured according to the equity method. This means that investments are measured at the pro rata share of the associates’ equity value. Refer to the above section on business combinations for more details about the accounting policies used on acquisitions of investments in associates. Investments in associates are written down to the lower of recoverable amount and carrying amount.Investments in associates fall within the definitions of both participating interests and associates, yet in the financial statements they have been presented as investments in associates because this designation reflects more accurately the Company’s involvement in the relevant entities. ReceivablesReceivables are measured at amortised cost, usually equalling nominal value less writedowns for bad and doubtful debts.Deferred taxDeferred tax is recognised on all temporary differences between the carrying amount and the tax-based value of assets and liabilities, for which the tax-based value is calculated based on the planned use of each asset. However, no deferred tax is recognised for amortisation of goodwill disallowed for tax purposes and temporary differences arising at the date of acquisition that do not result from a business combination and that do not have any effect on profit or loss or on taxable income. Deferred tax assets, including the tax base of tax loss carryforwards, are recognised in the balance sheet at their estimated realisable value, either as a set-off against deferred tax liabilities or as net tax assets.PrepaymentsPrepayments comprise incurred costs relating to subsequent financial years. Prepayments are measured at cost.CashCash comprises cash in hand and bank deposits.Lease liabilitiesLease liabilities relating to assets held under finance leases are recognised in the balance sheet as liabilities other than provisions, and, at the time of inception of the lease, measured at the present value of future lease payments. Subsequent to initial recognition, lease liabilities are measured at amortised cost. The difference between present value and nominal amount of the lease payments is recognised in the income statement as a financial expense over the term of the leases.Other financial liabilitiesOther financial liabilities are measured at amortised cost, which usually corresponds to nominal value.2023-07-11Thomas Stenager