BDO Statsautoriseret revisionsaktieselskabKystvejen 29DK-8000 Aarhus C20222670Årsrapport2023-06-08Henrik Wessmann JensenOskar Real Copenhagen ApSKongens Nytorv 28 1.1050 Copenhagen KRevisionspåtegning428483012021-11-19Copenhagen2021-11-192022-12-31BDO Statsautoriseret revisionsaktieselskabKystvejen298000Aarhus CCopenhagen2023-06-08Jesper BrinkmannHenrik Wessmann JensenChairmanBo Rigmond SattrupKonklusion med forbeholdGrundlag for konklusion med forbeholdAarhus2023-06-08BDO Statsautoriseret revisionsaktieselskab20222670Klaus Tvede-JensenRevisionspåtegningState Authorised Public Accountantmne23304-15437017-39598291812373076375356-39598204759070036208173594394465216133075204633474560200370661343749402003706620037066017515970020037066-155122634200370662003706655090000005509000000047381685404738168545509000004738168541649890311900947065688629064417317655663742203790361601765561647563416475634164756341647563413653216769465483264904707204000040000017515970020037066-1551226342007706620077066717827100717827100289260150289260150108823012013615445618101425329398150601010106470274403212863948018000890516829411925128144504013452902536784441192518546885504703936549465483264904707204000002003706640000200370664000000175159700-15512263440000175159700-15512263476375356-9181237327003-26342451-76269602-2963191003727252347640613413653213653211116407013321087019592641920522995216449414213148959121301627334450586550900000216449413ejendomme5509000009181237329865715429865715447590700127569000175159700473816854Regnskabsklasse BtruetrueToday the Board of Directors and Executive Board have discussed and approved the Annual Report of Oskar Real Copenhagen ApS for the financial year 19 November 2021 - 31 December 2022. The Annual Report is presented in accordance with the Danish Financial Statements Act. In our opinion the Consolidated Financial Statements and the Annual Financial Statements of the Company give a true and fair view of Group's and the Company's assets, liabilities and financial position at 31 December 2022 and of the results of Group's and the Company's operations and cash flows for the financial year 19 November 2021 - 31 December 2022. The Management Commentary includes in our opinion a fair presentation of the matters dealt with in the Commentary. We recommend the Annual Report be approved at the Annual General Meeting. To the Shareholders of Oskar Real Copenhagen ApS We have audited the Consolidated Financial Statements and the Annual Financial Statements of the Company of Oskar Real Copenhagen ApS for the financial year 19 November 2021 - 31 December 2022, which comprise income statement, Balance Sheet, statement of changes in equity, notes and a summary of significant accounting policies for both the Group and the Parent Company, as well as consolidated statement of cash flows for the Group. The Consolidated Financial Statements and the Annual Financial Statements of the Company are prepared in accordance with the Danish Financial Statements Act. Except for the matters described in the ''Basis for Qualified Opinion'' paragraph, it is our opinion that the Consolidated Financial Statements and the Annual Financial Statements of the Company give a true and fair view of the assets, liabilities and financial position of the Group or the Company at 31 December 2022 and of the results of the Group and the Parent Company's operations as well as the consolidated cash flows of the Group for the financial year 19 November 2021 - 31 December 2022 in accordance with the Danish Financial Statements Act. Basis for Qualified Opinion Grundlag for konklusion med forbehold The Group’s investment properties have been recognised in the balance sheet with DKK (‘000) 550,900 and a value adjustment of DKK (‘000) 91,812 in the income statement before tax. According to our assessment, Management has recognised the value of construction rights at a higher value than the market value. It is our opinion that the investment properties should be written down by DKK (‘000) 82,197 before tax. As a result of this, the investment properties will be reduced with DKK (‘000) 82,197, while tax on the profit for the year, profit for the year, and equity will be reduced with DKK (‘000) 18,083, DKK (‘000) 64,114, and DKK (‘000) 64,114, respectively. The Company’s subsidiaries have been recognised in the balance sheet with DKK (‘000) 473,816 and with recognition of the subsidiaries’ results according to the equity method of DKK (‘000) 91,812. According to our assessment, Management has recognised the value of construction rights in 2 subsidiaries at a higher value than the market value. It is our opinion that investments in subsidiaries should be written down by DKK (‘000) 64,114 before tax. As a result of this, investments in subsidiaries will be reduced with DKK (‘000) 64,114, while tax on the profit for the year, profit for the year, and equity will be reduced with DKK (‘000) 0, DKK (‘000) 64,114, and DKK (‘000) 64,114, respectively. We conducted our audit in accordance with International Standards on Auditing (ISAs) and the additional requirements applicable in Denmark. Our responsibilities under those standards and requirements are further described in the “Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements and the Annual Financial Statements of the Company” section of our report. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code), together with the ethical requirements that are relevant to our audit of the financial statements in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. In our opinion, the evidence we have obtained is sufficient and appropriate to provide a basis for our qualified conclusion. Management's Responsibilities for the Consolidated Financial Statements and the Annual Financial Statements of the Company Management is responsible for the preparation of Consolidated Financial Statements and the Annual Financial Statements of the Company 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 Consolidated Financial Statements and the Annual Financial Statements of the Company that are free from material misstatement, whether due to fraud or error. In preparing the Consolidated Financial Statements and the Annual Financial Statements of the Company, Management is responsible for assessing the Group's and the Parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting in preparing the Consolidated Financial Statements and the Annual Financial Statements of the Company unless Management either intends to liquidate the Group or the Company or to cease operations, or has no realistic alternative but to do so. Our objectives are to obtain reasonable assurance about whether the Consolidated Financial Statements and the Annual Financial Statements of the Company 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 Consolidated Financial Statements and the Annual Financial Statements of the Company. As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the Consolidated Financial Statements and the Annual Financial Statements of the Company, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group's and the Parent Company's internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management. Conclude on the appropriateness of Management’s use of the going concern basis of accounting in preparing the Consolidated Financial Statements and the Annual Financial Statements of the Company and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's and the Parent Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the Consolidated Financial Statements and the Annual Financial Statements of the Company 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 Group and the Parent Company to cease to continue as a going concern. Evaluate the overall presentation, structure and contents of the Consolidated Financial Statements and the Annual Financial Statements of the Company, including the disclosures, and whether the Consolidated Financial Statements and the Annual Financial Statements of the Company represent the underlying transactions and events in a manner that gives a true and fair view. Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the Consolidated Financial Statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Statement on Management Commentary Management is responsible for Management Commentary. Our opinion on the Consolidated Financial Statements and the Annual Financial Statements of the Company does not cover Management Commentary, and we do not express any form of assurance conclusion thereon. In connection with our audit of the Consolidated Financial Statements and the Annual Financial Statements of the Company, our responsibility is to read Management Commentary and, in doing so, consider whether Management Commentary is materially inconsistent with the Consolidated Financial Statements and the Annual Financial Statements of the Company or our knowledge obtained during the audit, or otherwise appears to be materially misstated. Moreover, it is our responsibility to consider whether Management Commentary provides the information required under the Danish Financial Statements Act. Based on the work we have performed, we conclude that Management Commentary is in accordance with the Consolidated Financial Statements and the Annual Financial Statements of the Company and has been prepared in accordance with the requirements of the Danish Financial Statements Act. We did not identify any material misstatement of Management Commentary. Principal activities The principal activities comprise operations within real-estate and other investment activities. Recognition and measurement uncertainty The properties are recognized in the financial statement at fair value, which has been calculated using return-based valuation models. The fair value represents the expected sales value if sold to a third party on the balance sheet date. The Group is continuous engaging with potential tenants and real estate agents, in order to gain a solid view of market levels for leases and yields which further form the basis for the components used in the fair value calculations. The market insights may not fulfill the strict requirements for the Auditors to sign up for, however the management still chooses to present the up-to-date market insights in the annual report with the intend to report what the management believes is a fair value picture of the properties. The fair value calculation is based on a number of assumptions including that the actual development projects are completed and on which pro-forma net earnings, a rate of return, the budgeted future cost for renovation, construction, development fee and the rate of progress have been estimated. Due to the attractive locations, there has been made no deductions for vacancies in the calculations. The required rate of return for the Group's properties averages approximately 4,28% at 31 December. An increase of the required rate of return of 0.5 percentage points would reduce the total fair value by approximately DKK 161m. A reduction of the required rate of return of 0.5 percent's points would increase the value by approximately DKK 202m. The property portfolio is composed of mixed commercial and residential rental properties, with the main emphasis being on commercial rental properties. For commercial rentals, the budgeted per square metre rent ranges between DKK 850 and DKK 13,750, depending on the application of the lease. The budgeted per square metre rent for residential rentals is DKK 2,269. The properties are placed in or around Copenhagen The budgeted future cost for renovation, construction and development, earnings and rate of return are based on estimates and as well as expected future events and is thus subject to uncertainty. Further full financing for the development and construction projects except for Blegdamsvej are also subject to uncertainty. However, construction is only started when the financing is in place. Work in progress Revenue and the value Work in progress, which is measured at the selling price of the work performed, are recognized based on the state of completion of the work performed. The stage of completion is estimated based on several factors such as the progress in signing of rent contracts, progress in the construction work and the complexity of the outstanding work The stage of completion is based on estimates and as well as expected future events and is thus subject to uncertainty. Material events and finances A bond issue in Q1 2022 initiated the acquisition of number of target properties comprising Blegdamsvej 124, Købmagergade 5, the plot on Roskildevej 547, Gladsaxe Møllevej 25 and Columbusvej 1-3 in the beginning of the year. The property on Blegdamsvej is a modern office facility with a supermarket on the ground floor. The property is fully let, however significant delays in building permissions caused delays finalizing the total project. The property was sold to a large Danish Top Tier pension fund in 2019 and was finally delivered in Q1 2023. By the end of 2022 the property is classified as work in progress in the balance sheet. The plans for the property on Købmagergade 57 have been changed a few times partly due to the Covid-19 pandemic and timelines have been postponed. However, building petitions will be filed in early 2023 to convert the empty attic into two new luxurious penthouse apartments. The back building will be converted into new charming retail stores. The property is still generating a positive cash flow from the existing tenants and when the development is finalized the company expects to keep the asset as a core property with the aim of supporting the creation of a portfolio of properties in and around Copenhagen. By the end of 2022 the property is classified as an investment property in the balance sheet. The plot on Roskildevej 547 is supposed to comprise a hotel, office, a fast-food restaurant and minor add ons. A 20-year lease contract with a highly reputable international hotel chain has been signed. When the development and construction is finalized, the company expects to keep the asset as a core property with the aim of supporting the creation of a portfolio of properties in and around Copenhagen. By the end of 2022 the property is classified as an investment property in the balance sheet. The Gladsaxe Møllevej property is almost fully leased and the operating income sufficiently covers the actual obligations. It is the intention to exploit the building rights and develop and construct more office areas to meet existing and future needs. When the development and construction is finalized, the company expects to keep the asset as a core property with the aim of supporting the creation of a portfolio of properties in and around Copenhagen. By the end of 2022 the property is classified as an investment property in the balance sheet. The Columbusvej property is partly leased. The plan is to develop offices, laboratories, a hotel and a supermarket. A local plan is expected in the beginning of 2024, however stage one can be initiated during 2023 by building the first 12-14,000 m2 partly for large, international life science company. When the development and construction is finalized, the company expects to keep the asset as a core property with the aim of supporting the creation of a portfolio of properties in and around Copenhagen. By the end of 2022 the property is classfied as an investment property in the balance sheet. The properties are measured at fair value using the return-based model which leads to a revaluation of 91,812 t.kr. which to some extent also reflects the ongoing development of the properties. The groups income statement for the financial year 1 January 2022 – 31 December 2022 shows a profit of 20,037 t.kr. The result of the year is considered satisfactory. Significant events after the end of the financial year The Property on Blegdamsvej 124 was finally delivered to the Danish pension Fund in Q1 2023 after having received all delayed building permissions. All interest bearing short term debt in the balance sheet for 2022 was redeemed by this transaction to the delivery date in Q1 2023. Apart from this no significant events have occurred after the end of the financial year. Particular risk The Entity is exposed to common commercial risks associated with property development like availability of financing, development in the office market, in Greater Copenhagen and cyclic trends on the real estate market, and in addition to this exchange risks on debt denominated in SEK and EUR. Group Share capital Retained earnings Total Equity at 19 November 2021 40.000 0 40.000 Proposed profit allocation 20.037.066 20.037.066 Equity at 31 December 2022 40.000 20.037.066 20.077.066 Parent Company Share capital Reserve for net revaluation under the equity method Retained earnings Total Equity at 19 November 2021 40.000 0 0 40.000 Proposed profit allocation 175.159.700 -155.122.634 20.037.066 Equity at 31 December 2022 40.000 175.159.700 -155.122.634 20.077.066 Group Parent Company 2021/22 2021/22 DKK DKK Staff costs 1 Average number of employees 1 1 Property, plant and equipment 3 Group Investment properties Cost at 19 November 2021 195.926.419 Additions 20.522.995 Cost at 31 December 2022 216.449.414 Revaluation at 19 November 2021 213.148.959 Revaluation of the year 121.301.627 Revaluation at 31 December 2022 334.450.586 Carrying amount at 31 December 2022 550.900.000 Value of recognised assets, excluding revaluation under § 41 (1) 216.449.413 The carrying amount of property, plant and equipment includes investment property measured at fair value by the following amounts: Group ejendomme Fair value at 31 December 2022 550.900.000 Value adjustment in the year recognised in the Income Statement 91.812.373 Revaluations and impairment losses of the investment property is based on accounting judgements based on market value calculations of the net rent. As described in the Summary of significant accounting policies, investment properties are measured at fair value, subject to the completion of the planned projects and using the return-based model. The required rate of return on the Group’s properties is between 3,35% and 5,00% at 31.12.2022. An increase of the required rate of return of 0.5 percentage points would reduce the total fair value by approximately DKK 161 m. A reduction of the required rate of return of 0.5 percentage points would increase the value by approximately DKK 202 m. The total size of the properties is 50.741 m2. The properties are located in or around Copenhagen. The fair value of the Company’s investment property amounts to DKK 550,9 m at the balance sheet date. This yields a change in the fair value of DKK 91,8 m, which has been recognised directly in the income statement. No external valuation expert has been engaged to determine the fair value. Financial non-current assets 4 Parent Company Investments in subsidiaries Additions 298.657.154 Cost at 31 December 2022 298.657.154 Profit/loss for the year 47.590.700 Revaluation and impairment losses for the year 127.569.000 Revaluation at 31 December 2022 175.159.700 Carrying amount at 31 December 2022 473.816.854 Goodwill There is no Goodwill or Badwill for Financial non-current assets. Investments in subsidiaries Name and domicil Ownership Real Danmark Ejendomme I ApS, Copenhagen 100 % Real Danmark Ejendomme II ApS, Copenhagen 100 % Real Danmark Ejendomme III ApS, Copenhagen 100 % Real Danmark Ejendomme V ApS, Copenhagen 100 % Real Danmark Ejendomme VI ApS, Copenhagen 100 % There is no Goodwill or Badwill for Financial non-current assets. Group Parent Company 2022 2022 DKK DKK Contract work in progress 5 Sales value of completed work 311.900.947 0 Contract work in progress, net 311.900.947 0 Engelsk Contract work in progress (asset) 311.900.947 0 311.900.947 0 Contract work in progress relates to the construction of a property for an external party with whom an SPA has been signed before the construction of the property was initiated. After completion the property will be resold to the external party in a new company. In the financial year, T.DKK -22.799 has been recognised in income from construction contracts. The accumulated income from construction contracts thus amounts to DKK 0k at 31.12.2022. No prepayments from customers have been received. Long-term liabilities 6 Group 31/12 2022 Repayment Debt outstanding total liabilities next year after 5 years Debt to mortgage credit institution 291.060.150 1.800.000 34.540.000 531.100 531.100.01 Other bank debt 108.823.012 0 0 531.200 531.200.01 Payables to group enterprises 136.154.456 0 0 535.400 535.400.01 Other non-current liabilities 63.832.673 0 0 535.600 535.600.01 Deposit 2.939.815 0 0 535.950 535.950.01 602.810.106 1.800.000 34.540.000 Parent Company 31/12 2022 Repayment Debt outstanding total liabilities next year after 5 years Debt to mortgage credit institution 289.260.150 0 0 531.100 531.100.01 Payables to group enterprises 181.014.253 0 240.478.787 535.400 535.400.01 470.274.403 0 240.478.787 Debt to Group companies 7 Debt to Group companies includes debt to: Oskar Group A/S Real Danmark A/S Oskar Properties ApS Oskar Byg A/S Hawk Investments ApS OG Finans ApS Contingent liabilities Bank loans are secured by way of a deposited mortgage deed registered to the mortgagor of nominally DKK 187m on properties. As security for bank debt, mortgage registered to the mortgagor of nom. DKK 55,345 has been deposited in the Company’s investment property. The property has a carrying amount of DKK 150,7 m. The Company has issued an all monies mortgage of DKK 100 m, which grant a mortgage on the property. As security for debt instruments and bank debt, the Company has charged owner’s mortgage of nominally DKK (‘000) 56,600 in the property, which has a carrying amount of DKK 126,000,000. As security for credit institutions and banks, the Company has issued a mortgage registered to the mortgagor of nominally DKK (‘000) 75,300 in the property, which has a carrying amount of DKK 215,800,000. As security for debt instruments a mortgage registered to the mortgagor of nom. DKK 210 m in the property. The property has a carrying amount of DKK 312 m. An all-moneys mortgage for DKK 100m has been issued on properties. The carrying amount of mortgaged properties is DKK 804,5m A first priority pledge over all shares owned by the parent company has been issued. The carrying amount of investments in group enterprises is DKK 473,8m Suretyship has been issued in Real Danmark Ejendomme II ApS. This has been provided by Oskar Real Copenhagen ApS (this has been discontinued in 2023). Joint liabilities The Company is jointly and severally liable together with the Parent Company and the other group companies in the joint taxable group for tax on the group’s joint taxable income and for certain possible withholding taxes, such as dividend tax, etc. Tax payable on the Group’s joint taxable income is stated in the annual report of HAWK INVESTMENTS ApS, which serves as management Company for the joint taxation. Consolidated Financial Statements 9 The Companay is included in the consolidated accounts for Hawk investmenst ApS, Kongens Nytorv 28, 1., 1050 København, Cvr-nummer 25 08 32 88 parent company. The company is included in the conslidated accounts for Oskar Group A/S, Kongens Nytorv 28, 1., 1050 København, Cvr-nummer 30 61 74 01 which is parent company for the nearest group. The Annual Report of Oskar Real Copenhagen ApS for 2021/22 has been presented in accordance with the provisions of the Danish Financial Statements Act for enterprises in reporting class B and certain provisions applying to reporting class C. Regnskabsklasse B1 true true The Annual Report is prepared with the following accounting principles. The Consolidated Financial Statements include the Parent Company Oskar Real Copenhagen ApS and the subsidiaries in which Oskar Real Copenhagen ApS directly or indirectly holds more than 50% of the voting rights or in any other way has a controlling influence. Enterprises in which the Group holds between 20% and 50% of the voting rights and exercises significant, but not controlling influence, are considered associates, see the Group structure. The Consolidated Financial Statements consolidate the Financial Statements of the Parent Company and the subsidiaries by combining uniform accounts items. Intercompany income and expenses, shareholdings, intercompany accounts and dividend, and realised and unrealised gains and losses arising from transactions between the consolidated enterprises are fully eliminated in the consolidation. Newly acquired or established enterprises are recognised in the Consolidated Financial Statements from the date of acquisition. Sold or wound up enterprises are recognised in the Consolidated Income Statement up to the date of disposal. Comparative figures are not adjusted for newly acquired, sold or wound up enterprises. The date of acquisition is the date at which the Group gains actual control over the acquired enterprises. Acquired enterprises are recognised in the Consolidated Financial Statements under the acquisition method, reassessing all identified assets and liabilities to fair value at the acquisition date. The fair value is calculated based on acquisitions made in an active market, alternatively calculated using generally accepted valuation methods. Deferred tax on the taken over reassessments is recognised with the exception of goodwill. At calculation of the fair value of investment properties, a discounted cash flow model is applied based on discounted cash flow of future earnings. Operating equipment is recognised at fair value based on an assessor’s opinion, using an overall assessment of the production equipment. Positive differences (goodwill) between the acquisition value and fair value of acquired and identified assets and liabilities are recognised in intangible fixed assets as goodwill and amortised systematically in the Income Statement under an individual assessment of the useful life. Negative differences are recognised in the Income Statement at the date of acquisition. The difference from acquired enterprises is DKK (‘000) 0. Transaction costs, incurred in connection with acquisition of enterprises, are recognised in the Income Statement in the year in which the costs are incurred. Investments in subsidiary enterprises are set off by the proportional share of the subsidiaries’ fair value of net assets and liabilities at the acquisition date. Investments in associates are measured in the Balance Sheet at the proportional share of the equity value of the enterprises, calculated under the accounting policies of the Parent Company and eliminating proportionally any unrealised intercompany gains and losses. The proportional share of the results of the associates is recognised in the Income Statement after elimination of the proportional share of internal gains and losses. Net revenue When the result of contract work cannot be assessed reliably, revenue is only recognised corresponding to the related costs and only to the extent that it is likely that they will be recovered. Rental income is accrued to cover the period up to the end of the financial year. Payments charged to cover heating are not included in rental income. Other operating income Other operating income includes items of a secondary nature in relation to the enterprises' principal activities, including profit from sale of intangible and tangible assets, operating loss and conflict compensations, as well as salary refunds. Compensations are recognised when the income is estimated to be realisable. Other external expenses Other external expenses include other production, sales, delivery and administrative costs, including costs of energy, marketing, premises, loss on bad debts, lease expenses, etc Income from investments in subsidiaries The proportional share of the results of subsidiaries, stated according to the Parent Company’s accounting policies and with full elimination of unrealised intercompany profits/losses and deduction of amortisation of added value and goodwill resulting from purchase price allocation at the date of acquisition, is recognised in the Parent Company’s Income Statement. In connection with transfers, potential profits are recognised when the economic rights related to the sold subsidiaries are transferred, however, at the earliest when the profit has been realised or is regarded as realisable. Moreover, realised losses other than impairments are included where identified. Financial income and expenses Financial income and expenses include interest income and expenses, financial expenses of finance leases, realised and unrealised gains and losses arising from securities, debt and transactions in foreign currencies, as well as charges and allowances under the tax-on-account scheme, etc. Financial income and expenses are recognised by the amounts that relate to the financial year. Interest income and expenses are calculated on amortised cost prices. Tax The tax for the year, which consists of the current tax for the year and changes in deferred tax, is recognised in the Income Statement by the share that may be attributed to the profit for the year, and is recognised directly in equity by the share that may be attributed to entries directly to equity. Tangible fixed assets Land and buildings, production plant and machinery, other plant, fixtures and equipment are measured at cost less accumulated depreciation and impairment losses. The depreciation base is cost less estimated residual value after end of useful life. Straight-line depreciation is provided on the basis of an assessment of the expected useful lives of the assets and their residual value: Investment properties are initially recognised at cost, which comprise the purchase price and possible direct costs related to the properties. The investment properties are subsequently recognised at fair value corresponding to the market value of the properties. Changes in the fair market value are recognised in the Income Statement Properties under construction are recognised at cost. The fair value of investment properties is assessed by means of a return-based valuation model according to which the value is calculated on the basis of the returns from operating the investment properties and an individually determined requirement for returns. Subsequent costs are added to the purchase price of the investment properties, when it is likely that the payment will lead to future economic benefits to the Company. Other costs of repairs and maintenance are recognised in the Income Statement on payment. Profit or loss from sale of tangible fixed assets is stated as the difference between the sales price less costs of sale and the carrying amount at the date of sale. Profits or losses are recognised in the Income Statement. Financial non-current assets Investments in subsidiaries are measured in the Parent Company Balance Sheet under the equity method, which is regarded as a method of measuring/consolidation. Investments in subsidiaries are measured in the Balance Sheet at the proportional share of the enterprises’ carrying equity value, calculated in accordance with the Parent Company’s accounting policies with deduction or addition of unrealised intercompany profits or losses and with addition or deduction of the residual value of positive or negative goodwill calculated according to the acquisition method. Negative goodwill is recognised in the Income Statement when the equity interest is acquired. Where the negative goodwill is related to acquired contingent liabilities, the negative goodwill will be recognised as income when the contingent liabilities have been settled or cease. Acquired enterprises are subject to the acquisition method, reassessing all identified assets and liabilities to fair value at the acquisition date. The fair value is calculated based on acquisitions made in an active market, alternatively calculated using generally accepted valuation models. A discounted cash flow model is used to calculate the fair value of investment properties based on a discounted cash flow of future earnings. Operating equipment is recognised at fair value based on an assessor’s opinion, based on an overall assessment of the production equipment. The acquisition date is the date on which the Company gains actual control over the acquired entity. Net revaluation of investments in subsidiaries is transferred under equity to reserve for net revaluation under the equity value method to the extent that the carrying amount exceeds the acquisition value. Subsidiaries with a negative carrying equity value are measured to DKK 0 and any amounts due from these enterprises are written down to the extent that it is deemed to be irrecoverable. If the carrying negative equity value exceeds receivables, the residual amount is recognised under provision for liabilities to the extent that the Company has a legal or actual liability to cover the subsidiaries deficit. The Other securities include bonds and mortgages expected to be held to maturity and are measured at amortised cost. Impairment of fixed assets The carrying amount of , are assessed annually for indications of impairment other than that reflected by amortisation and depreciation. In the event of impairment indications, an impairment test is made for each asset or group of assets, respectively. If the recoverable amount is lower than the carrying amount, the asset is written down to the recoverable amount. The recoverable amount is calculated at the higher of the capital value and the sales value less expected costs of a sale. The capital value is determined as the Company's share in the current value of the net cash flows which the subsidiary is expected to generate through its activities and from sale of assets after the end of their useful lives. A discount rate is used which reflects the risk-free market rate and the owners' minimum return on interest requirements for similar assets. The growth rate in the terminal period is determined in accordance with the standards within the industry. Receivables Receivables are measured at amortised cost which usually corresponds to nominal value. The value is written down to meet expected losses. Contract work in progress Work in progress on contract is measured at the sales value of the work performed. The sales value is measured on the basis of the degree of completion on the Balance Sheet date and the total anticipated revenue related to the specific piece of work in progress. Accruals, assets Accruals recognised as assets include costs incurred relating to the subsequent financial year. Securities Securities recognised as current assets, comprise public quoted bonds, shares and other securities. Public quoted securities are measured at the market price. Non-quoted equity interests are measured at cost price. Other securities are measured at cost price in so far as an approximate sales value cannot be stated reliably. Tax payable and deferred tax Current tax liabilities and receivable current tax are recognised in the Balance Sheet as the calculated tax on the taxable income for the year, adjusted for tax on the taxable income for previous years and taxes paid on account. The Company is subject to joint taxation with Danish Group companies. The current corporation tax is distributed among the joint taxable companies in proportion to their taxable income and with full allocation and refund related to tax losses. The joint taxable companies are included in the tax-on-account scheme. Joint taxation contributions receivable and payable are recognised in the Balance Sheet under current assets and liabilities, respectively. Deferred tax is measured on the temporary differences between the carrying amount and the tax value of assets and liabilities. Deferred tax assets, including the tax value of tax loss carryforwards, are measured at the amount at which the asset is expected to be used within a reasonable number of years, either by setoff against tax on future earnings or by setoff against deferred tax liabilities within the same legal tax entity. Deferred tax is measured on the basis of the tax rules and tax rates that under the legislation in force on the Balance Sheet date will be applicable when the deferred tax is expected to crystallise as current tax. Any changes in the deferred tax resulting from changes in tax rates, are recognised in the income statement, except from items recognised directly in equity. Liabilities Financial liabilities are recognised at the time of borrowing by the amount of proceeds received less transaction costs. In subsequent periods, the financial liabilities are measured at amortised cost equal to the capitalised value when using the effective interest, the difference between the proceeds and the nominal value being recognised in the Income Statement over the loan period. The amortised cost of current liabilities corresponds usually to the nominal value. CASH FLOW STATEMENT With reference to Section 86(4) of the Danish Financial Statements Act, the Company has not prepared a cash flow statement. A cash flow statement has been prepared for the Group. The cash flow statement shows the Company’s cash flows for the year for operating activities, investing activities and financing activities in the year, the change in cash and cash equivalents of the year and cash and cash equivalents at beginning and end of the year. Cash flows from operating activities: Cash flows from operating activities are computed as the results for the year adjusted for non-cash operating items, changes in net working capital and corporation tax paid. Cash flows from investing activities: Cash flows from investing activities include payments in connection with purchase and sale of intangible and tangible fixed asset and fixed asset investments. Cash flows from financing activities: Cash flows from financing activities include changes in the size or composition of share capital and related costs, and borrowings and repayment of interest-bearing debt and payment of dividend to shareholders. Cash and cash equivalents: Cash and cash equivalents include cash at bank and in hand and short-term securities, for which there is only negligible risk of changes in value, and which are readily negotiable for cash at bank and in hand. With reference to Section 86(4) of the Danish Financial Statements Act, the Company has not prepared a cash flow statement. A cash flow statement has been prepared for the Group. 428483012021-11-192022-12-31d:ConsolidatedMember428483012021-11-192022-12-31d:ConsolidatedMember1428483012021-11-192022-12-31d:ConsolidatedMember2428483012021-11-192022-12-31d:ConsolidatedMember1428483012021-11-192022-12-311d:ConsolidatedMember428483012022-12-31428483012021-11-192022-12-31428483012022-12-31d:ConsolidatedMember428483012021-11-19g:ContributedCapitalMember428483012022-12-31g:ContributedCapitalMember428483012021-11-192022-12-31g:ReserveForNetRevaluationAccordingToEquityMethodMember428483012021-11-19g:ReserveForNetRevaluationAccordingToEquityMethodMember428483012022-12-31g:ReserveForNetRevaluationAccordingToEquityMethodMember428483012021-11-192022-12-31g:RetainedEarningsMember428483012021-11-19g:RetainedEarningsMember428483012022-12-31g:RetainedEarningsMember428483012021-11-19g:ContributedCapitalMemberd:ConsolidatedMember428483012022-12-31g:ContributedCapitalMemberd:ConsolidatedMember428483012021-11-192022-12-31g:RetainedEarningsMemberd:ConsolidatedMember428483012021-11-19g:RetainedEarningsMemberd:ConsolidatedMember428483012022-12-31g:RetainedEarningsMemberd:ConsolidatedMember428483012021-11-192022-12-31g:InvestmentPropertyMemberd:ConsolidatedMember428483012021-11-19g:InvestmentPropertyMemberd:ConsolidatedMember428483012022-12-31g:InvestmentPropertyMemberd:ConsolidatedMember428483012022-12-31d:ConsolidatedMemberDagsværdi - Materielle anlægsaktiver 1428483012021-11-192022-12-31d:ConsolidatedMemberDagsværdi - Materielle anlægsaktiver 1428483012021-11-192022-12-31g:InvestmentsInGroupEnterprisesMember428483012022-12-31g:InvestmentsInGroupEnterprisesMemberxbrli:pureiso4217:DKK