Årsrapport Nadav Sadan 2023-06-29 Revisionspåtegning Regnskabsklasse C, mellemstor virksomhed Beierholm Voergaardvej 2 9200 Aalborg SV 2021-02-01 2022-01-31 2022-02-01 2023-01-31 27373968 Nvidia Denmark ApS Ledreborg Allé 130 B 4000 Roskilde Roskilde Beierholm 32895468 Himmelev Bygade 70 4000 Roskilde Danmark true true We have on this day presented the annual report for the financial year 01.02.22 - 31.01.23 for Nvidia Denmark ApS. The annual report is presented in accordance with the Danish Financial Statements Act (Årsregnskabsloven). In our opinion, the financial statements give a true and fair view of the company's assets, liabilities and financial position as at 31.01.23 and of the results of the company's activities and cash flows for the financial year 01.02.22 - 31.01.23. We believe that the management's review includes a fair review of the matters dealt with in the management's review. The annual report is submitted for adoption by the general meeting. Roskilde 2023-06-01 Nadav Sadan Managing Director Nadav Sadan Chairman Ofer Perets Henning Lysdal Gideon Rosenberg To the Shareholder of Nvidia Denmark ApS Opinion We have audited the financial statements of Nvidia Denmark ApS for the financial year 01.02.22 - 31.01.23, which comprise the income statement, balance sheet, statement of changes in equity, cash flow statement and notes to the financial statements, including a summary of significant accounting policies. The financial statements are prepared in accordance with the Danish Financial Statements Act (Årsregnskabsloven). In our opinion the financial statements give a true and fair view of the company's assets, liabilities and financial position at 31.01.23 and of the results of the company's operations and cash flows for the financial year 01.02.22 - 31.01.23 in accordance with the the Danish Financial Statements Act (Årsregnskabsloven). Basis for Opinion We conducted our audit in accordance with International Standards on Auditing and the additional requirements applicable in Denmark. Our responsibilities under those standards and requirements are further described in the “Auditor’s responsibilities for the audit of the financial statements” section of our report. We are independent of the company in accordance with the International Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (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 management’s review. Our opinion on the financial statements does not cover management’s review, and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read management’s review and, in doing so, consider whether management’s review is materially inconsistent with the financial statements or our knowledge obtained during the audit, or otherwise appears to be materially misstated. Moreover, it is our responsibility to consider whether management’s review provides the information required under the Danish Financial Statements Act. Based on the work we have performed, we conclude that management’s review is in accordance with the financial statements and has been prepared in accordance with the requirements of the Danish Financial Statements Acts. We did not identify any material misstatement of management’s review. The Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the Danish Financial Statements Act. Furthermore the Management is responsible for the internal control as the Management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting in preparing the financial statements unless management either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so. Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with International Standards on Auditing 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 International Standards on Auditing and the additional requirements applicable in Denmark, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company's internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management. Conclude on the appropriateness of management’s use of the going concern basis of accounting in preparing the financial statements and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern. Evaluate the overall presentation, structure and contents of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that gives a true and fair view. We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Roskilde 2023-06-01 Birgit Sode State Authorized Public Accountant mne28909 15686000 12468000 17026000 -1553000 707000 5751000 -137000 -50000 -63000 -1669000 364000 6297000 14835000 13568000 11965000 769000 697000 355000 837000 72000 7473000 9142000 8810000 -1680 -20 4 111 67 -66 50 67 74 Primary activities Starting February 1st, 2022, the company provides research and development services of integrated microelectronics to Mellanox Technologies Ltd (“MTL”) which is used in fibre-optic interconnect in computers and network systems. In addition, the company is receiving royalties from granting Mellanox Technologies Ltd a non-exclusive, sublicensable license to reproduce, manufacture, distribute, and use all its intangible rights and products for the purpose of MTL´s business activity in each territory. Development in activities and financial affairs The income statement for the period 01.02.22 - 31.01.23 shows a profit/loss of USD 14,716,521 against USD -13,356,338 for the period 01.02.21 - 31.01.22. The balance sheet shows equity of USD 8,833,281. The earnings for the financial year 01.02.22 - 31.01.23 include one-time sale of all the inventory to Mellanox Technologies Ltd following the License Agreement (see “Significant changes in financial affairs”) On April 11, 2022, the company that at the time was named Mellanox Technologies Denmark Aps (“MTDK”) signed a License Agreement with MTL effective February 1, 2022, according to which MTDK grants MTL a non-exclusive, royalty-bearing, sublicensable license to reproduce, manufacture, distribute, and use all its intangible rights and products for the purpose of MTL´s business activity in each territory. In addition, MTDK grants MTL a nonexclusive, royalty-bearing, sublicensable license to modify and further develop its Licensed Intellectual Property. In consideration of the exercise of the license rights granted by MTDK to MTL, MTL will pay MTDK royalties over a discrete period as described in the Agreement. In addition, On April 11, 2022, MTDK signed a Research and Development Service Agreement with MTL effective February 1, 2022. According to this Agreement, MTDK will provide MTL research and development services and will be compensated in amount equal to operating costs, plus a markup on such costs determined in accordance with a contemporaneous transfer pricing study. Significant changes in financial affairs. Outlook For the coming year, the company expects to be profitable, with its main income being generated from providing R&D services to MTL leading to an expected profit of USD 3-4M. 45960567 13301658 26315313 29042455 484266 526473 19160988 -16267270 3959 0 37367 86423 19127580 -16353693 4411059 -2997355 14716521 -13356338 236121 0 1349204 1300725 1585325 1300725 44151 46268 44151 46268 1629476 1346993 0 1063192 0 1063192 531238 0 1960047 4804222 0 26108 105381 409611 2596666 5239941 8884394 1221146 11481060 7524279 13110536 8871272 260226 260226 0 16220493 1573055 -22363959 7000000 0 8833281 -5883240 609396 247539 0 12640285 459038 0 3208821 1866688 4277255 14754512 4277255 14754512 13110536 8871272 -16220493 16220493 7716521 7000000 260226 0 1573055 7000000 4954840 -2350857 1063192 -528578 -224891 9761836 361857 77717 -11298152 7315253 9573367 919033 3959 0 -37367 -86423 -1107845 -26108 8432114 806502 -768866 -696631 -768866 -696631 7663248 109871 1221146 1111275 8884394 1221146 8884394 1221146 9214482 9122631 1247981 1314345 162270 28694 15690580 18576785 84 78 7000000 0 7716521 -13356338 715762 2665165 249375 519491 965137 3184656 -715762 -1364440 -13254 -471012 -729016 -1835452 236121 1349204 44151 44151 44151 4804222 1840470 -2844175 2963752 484266 526473 -3959 0 37367 86423 4411059 -2997355 26107 33602 The annual report is presented in accordance with the provisions of the Danish Financial Statements Act (Årsregnskabsloven) for medium-sized enterprises in reporting class C. 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. 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. 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. The annual report is presented in USD. The exchange rate is as at 31.01.23 and as at 31.01.22. On initial recognition, transactions denominated in foreign currencies are translated using the exchange rates applicable at the transaction date. Exchange rate differences between the exchange rate applicable at the transaction date and the exchange rate at the date of payment are recognised in the income statement as a financial item. Receivables, payables and other monetary items denominated in foreign currencies are translated using the exchange rates applicable at the balance sheet date. The difference between the exchange rate applicable at the balance sheet date and at the date at which the receivable or payable arose or was recognised in the latest annual report is recognised under financial income or expenses in the income statement. Fixed assets, inventories and other non-monetary assets acquired in foreign currencies are translated using historical exchange rates. Gross profit comprises revenue and raw materials and consumables and other external expenses. Income from the sale of goods is recognised in the income statement if delivery has taken place and the risk has passed to the buyer before the end of the financial year and where the selling price can be determined reliably and is expected to be paid. Revenue is measured at fair value and is determined exclusive of VAT and other taxes collected on behalf of third parties and less discounts. Income from the sale of services is recognised in the income statement in line with completion of services, which means that revenue corresponds to the selling price of the work performed for the year stated on the basis of the stage of completion at the balance sheet date (percentage of completion method). 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. 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. Other external expenses comprise also research and development costs that do not qualify for capitalization , Staff costs comprise wages and salaries as well as other staff-related costs. Wages and salaries and other staff-related costs associated with the research and development activity are also recognised under staff costs. The depreciation of property, plant and equipment aim at systematic depreciation over the expected useful lives of the assets. Assets are depreciated according to the straight-line method based on the following expected useful lives and residual values: The basis of depreciation is the cost of the asset less the expected residual value at the end of the useful life. Moreover, the basis of depreciation is reduced by any impairment losses. The useful life and residual value are determined when the asset is ready for use and reassessed annually. Property, plant and equipment are impaired in accordance with the accounting policies referred to in the ‘Impairment losses on fixed assets’ section. Interest income and interest expenses, foreign exchange gains and losses on transactions denominated in foreign currencies etc. are recognised in other net financials. The current and deferred tax for the year is recognised in the income statement as tax on the profit/loss for the year with the portion attributable to the profit/loss for the year. Property, plant and equipment comprise leasehold improvements as well as other fixtures and fittings, tools and equipment. Property, plant and equipment are measured in the balance sheet at cost less accumulated depreciation and impairment losses. Cost comprises the purchase price and expenses resulting directly from the purchase until the asset is ready for use. Interest on loans arranged to finance production is not included in the cost. Property, plant and equipment are depreciated using the straight-line method based on useful lives and residual values, which are stated in the ‘Depreciation and impairment losses' section. Gains and losses on the disposal of property, plant and equipment are determined as the difference between the selling price, if any, less selling costs and the carrying amount at the date of disposal less any costs of disposal. The carrying amount of fixed assets which are not measured at fair value is assessed annually for indications of impairment over and above what is reflected in depreciation. If the company's realised return on an asset or a group of assets is lower than expected, this is considered an indication of impairment. If there are indications of impairment, an impairment test is conducted of individual assets or groups of assets. The assets or groups of assets are impaired to the lower of recoverable amount and carrying amount. The higher of net selling price and value in use is used as the recoverable amount. The value in use is determined as the present value of expected net cash flows from the use of the asset or group of assets as well as expected net cash flows from the sale of the asset or group of assets after the expiry of their useful lives. Impairment losses are reversed when the reasons for the impairment no longer exist. Inventory includes finished goods, work-in-process and raw materials. Inventory is stated at the lower of cost (principally standard cost which approximates actual cost on a first-in, first-out - FIFO -basis) or net realizable value. The cost of inventories comprises costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. The Company allocates the fixed production overheads to the cost of conversion based on normal capacity of its production facilities. Net realizable value for potentially excess and obsolete inventory is determined based on management´s analysis of the inventory levels, future sales forecasts and market conditions. Once established, the original cost of the Company´s inventory less the related inventory reserve represents the new cost basis of such products. Receivables are measured at amortised cost, which usually corresponds to the nominal value, less write-downs for bad debts. Write-downs for bad debts are determined based on an individual assessment of each receivable if there is no objective evidence of individual impairment of a receivable. Deposits recognised under assets comprise deposits paid to the lessor under leases entered into by the company. Cash includes deposits in bank account. The proposed dividend for the financial year is recognised as a separate item in equity. Current tax payable and receivable is recognised in the balance sheet as tax computed on the basis of the taxable income for the year, adjusted for tax paid on account. Deferred tax liabilities and tax assets are recognised on the basis of all temporary differences between the carrying amounts and tax bases of assets and liabilities. However, deferred tax is not recognised on temporary differences relating to goodwill which is non-amortisable for tax purposes and other items where temporary differences, except for acquisitions, have arisen at the date of acquisition without affecting the net profit or loss for the year or the taxable income. In cases where the tax value can be determined according to different taxation rules, deferred tax is measured on the basis of management’s intended use of the asset or settlement of the liability. Deferred tax assets are recognised, following an assessment, at the expected realisable value through offsetting against deferred tax liabilities or elimination in tax on future earnings. Deferred tax is measured on the basis of the tax rules and at the tax rates which, according to the legislation in force at the balance sheet date, will be applicable when the deferred tax is expected to crystallise as current tax. Short-term payables are measured at amortised cost, normally corresponding to the nominal value of such payables. The cash flow statement is prepared using the indirect method, showing cash flows from operating, investing and financing activities as well as cash and cash equivalents at the beginning and end of the year. Cash flows from operating activities comprise the net profit or loss for the year, adjusted for non-cash operating items, income tax paid and changes in working capital. Cash flows from investing activities comprise payments in connection with the acquisition and divestment of companies and financial assets as well as the purchase, development, improvement and sale of intangible assets and property, plant and equipment. Cash flows from financing activities comprise changes in the company's share capital and associated costs and financing from and dividends paid to shareholders as well as the arrangement and repayment of long-term payables. Cash and cash equivalents at the beginning and end of the year comprise cash. Ratios definitions Return on equity: Profit/loss for the year x 100 Average equity Solvency ratio: Equity, end of year x 100 Total assets Figures in USD Share capital Share premium Retained earnings Proposed dividend for the financial year Total equity Statement of changes in equity for 01.02.22 - 31.01.23 Balance as at 01.02.22 260,226 16,220,493 -22,363,959 0 -5,883,240 Transfers to/from other reserves 0 -16,220,493 16,220,493 0 0 Net profit/loss for the year 0 0 7,716,521 7,000,000 14,716,521 Balance as at 31.01.23 260,226 0 1,573,055 7,000,000 8,833,281 1. Special items Special items are income and expenses that are special due to their size and nature. The following special items were recorded in the financial year: Special items: Recognised in the income statement in: 2022/23 USD 2021/22 USD One time sale of all the inventory Revenue 17,172,569 0 4. Property, plant and equipment Figures in USD Leasehold improvements Other fixtures and fittings, tools and equipment Cost as at 01.02.22 715,762 2,665,165 Additions during the year 249,375 519,491 Cost as at 31.01.23 965,137 3,184,656 Depreciation and impairment losses as at 01.02.22 -715,762 -1,364,440 Depreciation during the year -13,254 -471,012 Depreciation and impairment losses as at 31.01.23 -729,016 -1,835,452 Carrying amount as at 31.01.23 236,121 1,349,204 31.01.23 31.01.22 USD USD 6. Deferred tax Provisions for deferred tax as at 01.02.22 4,804,222 1,840,470 Deferred tax recognised in the income statement -2,844,175 2,963,752 Provisions for deferred tax as at 31.01.23 1,960,047 4,804,222 Deferred tax is distributed as below: Property, plant and equipment 29,348 45,887 Tax losses 1,930,699 4,758,335 Total 1,960,047 4,804,222 As at 31.01.23, the company has recognised a deferred tax asset of USD 1,960,047, which can primarily be attributed to tax losses carried forward. The deferred tax asset is recognised on the basis of expectations of positive operating results for the coming years. As at 31.01.23, the company has recognised a deferred tax asset of USD 1,960,047, which can primarily be attributed to tax losses carried forward. The deferred tax asset is recognised on the basis of expectations of positive operating results for the coming years. The company has no contingent liabilities as at 31.01.23. Controlling influence Basis of influence Mellanox Technologies UK Ltd, United Kingdom Sole shareholder Nvidia Corporation, United States Indirect parent company Related party transactions are not disclosed, as all transactions are entered into in the ordinary course of business at arms’ length. 27373968 2022-02-01 2023-01-31 27373968 2021-02-01 2022-01-31 27373968 2022-02-01 2023-01-31 d:TwoYearsAgoMember 27373968 2023-01-31 d:TwoYearsAgoMember 27373968 2022-02-01 2023-01-31 d:ThreeYearsAgoMember 27373968 2023-01-31 d:ThreeYearsAgoMember 27373968 2022-02-01 2023-01-31 d:FourYearsAgoMember 27373968 2023-01-31 d:FourYearsAgoMember 27373968 2022-02-01 2023-01-31 e:ProposedDividendRecognisedInEquityMember 27373968 2021-02-01 2022-01-31 e:ProposedDividendRecognisedInEquityMember 27373968 2022-02-01 2023-01-31 e:RetainedEarningsMember 27373968 2021-02-01 2022-01-31 e:RetainedEarningsMember 27373968 2022-01-31 27373968 2023-01-31 27373968 2022-02-01 2023-01-31 1 27373968 2022-02-01 2023-01-31 2 27373968 2022-02-01 2023-01-31 3 27373968 2022-02-01 2023-01-31 4 27373968 2022-02-01 2023-01-31 1 27373968 2023-01-31 e:ContributedCapitalMember 27373968 2022-02-01 2023-01-31 e:SharePremiumMember 27373968 2023-01-31 e:SharePremiumMember 27373968 2022-02-01 2023-01-31 e:RetainedEarningsMember 27373968 2023-01-31 e:RetainedEarningsMember 27373968 2022-02-01 2023-01-31 e:ProposedDividendRecognisedInEquityMember 27373968 2023-01-31 e:ProposedDividendRecognisedInEquityMember 27373968 2022-02-01 e:FixturesFittingsToolsAndEquipmentMember 27373968 2022-02-01 2023-01-31 e:FixturesFittingsToolsAndEquipmentMember 27373968 2023-01-31 e:FixturesFittingsToolsAndEquipmentMember 27373968 2022-02-01 e:LeaseholdImprovementsMember 27373968 2022-02-01 2023-01-31 e:LeaseholdImprovementsMember 27373968 2023-01-31 e:LeaseholdImprovementsMember 27373968 2022-02-01 27373968 2021-02-01 27373968 2022-02-01 e:DepositsLongtermInvestmentsAndReceivablesMember 27373968 2023-01-31 e:DepositsLongtermInvestmentsAndReceivablesMember 27373968 2022-02-01 2023-01-31 1 iso4217:USD xbrli:pure