Annual report
at 31 December
02 Report on operations 13
03 Group annual report
and financial statements
89
Consolidated financial statements: 90
— Consolidated income statement 90
— Consolidated statement
of comprehensive income 91
— Consolidated statement
of financial position 92
— Consolidated statement of cash flows 94
— Consolidated statement
of changes in net equity 95
Explanatory notes 96
External auditors’ report on the
consolidated financial statements 148
Independent auditors’ report on
consolidated Non-Financial Statement 155
04 Report on operations
on separate financial statements
159
05 Separate annual report
and financial statements
176
De’ Longhi S.p.A. - Separate financial
statements: 177
— Income statement 177
— Statement of comprehensive income 178
— Statement of financial position 179
— Statement of cash flow 181
— Statement of changes in net equity 182
Explanatory notes 183
External auditors’ report
on the separate financial statements 221
01 De’ Longhi Group 3
ContentsAnnual report
at 31 December
The Annual report at 31 December 2023 has been translated from the Italian original solely for the
convenience of international readers.
The original version has been issued in Italian in accordance to the Delegated regulation (EU)
2019/815. The Italian version shall always prevail in case of any discrepancy or inconsistency be-
tween Italian version and its English translation.
Due to mechanisms of producing xHTML documents, some narrative blocks extracted from such
documents to an XBRL instance may not maintain the graphic structure that was attributed to them.
The limitations to the transformation mechanisms are known and understood by the XBRL commu-
nity. For a better understanding of the values, it is advisable to refer to the xHTML format.
The De’Longhi Group
De’Longhi Group
|
01 The De’Longhi Group 4
Our vision,
our mission,
our values
Heritage
Passion
Respect
Competence
Ambition
Teamwork
Courage
Our values
The Group has its roots in the early 1900s when the
de’ Longhi family founded a workshop for the pro-
duction of industrial components; over the years it
became a manufacturer of finished goods for third
parties; in 1974 the first De’ Longhi brand appliance
was launched, marking the beginning of the
Group’s history.
Known initially as a manufacturer of portable elec-
tric heaters and air conditioners, over the years the
Company increased the range of products
produced.
Today, the Group offers a range of small domestic
appliances for the preparation of coffee, food-
preparation and cooking, comfort (air conditioning
and heating), as well as home care, and operates
mainly through the three brands, De’ Longhi, Ken-
wood and Braun.
More recently, the product range was increased
thanks to the acquisition of Capital Brands Holding
Inc., an American company active in the personal
blenders segment with the Nutribullet and Magic
Bullet brands and the Eversys Group, active in the
professional espresso coffee machine sector.
The Group, whose main headquarters are in Trevi-
so (Italy), is present worldwide thanks to the direct
commercial branches and a network of distribu-
tors; it also owns six productive plants and a few
stores.
The Group aims to strengthen its global leadership,
reaching consumers worldwide with superior solu-
tions for design, quality and technology.
The strong points that the Group can count on to
achieve these goals include a portfolio comprised
of strong, unique and diversified brands, the ability
to see the new market trends, an extensive global
reach, as well as the diversity and talent of its
people.
The Group’s values reflect who we are, our charac-
ter, and our way of being and working. They are
ideals that guide the Group’s operations through
the day-to-day work of its people and their
projects.
Worldwide,
Every Day,
by your Side
A desiderable object,
An emotion,
An authentic experience
To be lived,
To be shared.
De’Longhi Group
|
01 The De’Longhi Group 5
The business
model
We design
products and
experiences
Each product is born out
of research, development,
and engineering involving
our technical units as well
as the Marketing and
Design divisions.
After defining the solution,
the Group purchases the
required raw materials
and components.
From raw
materials to
products
The purchased raw
materials and
components are shipped
to the Group’s production
sites and to the partners
that manufacture and
assemble the products.
The process is structured
around specialized
centers where a specific
product is always
manufactured inside the
same plant.
Reaching
customers and
consumers
The products are shipped
from the sourcing centers
and logistics hubs to the
various warehouses and
then distributed across
the Group’s entire sales
network.
Test after test,
quality and
safety
At the end of the
manufacturing process all
products, including the
solutions made by the
partners that supply
finished products, are
tested to guarantee the
highest safety and quality
standards.
De’Longhi Group
|
01 The De’Longhi Group 6
In 2023 the Group continued with the gradual inte-
gration of issues relating to environmental and
social sustainability, as well as governance, in the
company’s strategy, risk management, and com-
pensation processes, with a view to promoting a
systematic and transparent approach, consistent
with the standards called for in the Code of Ethics.
Various projects were developed during the year,
aimed at achieving the targets defined in the Sus-
tainability Manifesto published in 2022, thanks to
the constant work done rooted in the three pillars of
our sustainability path: Products, Processes,
People.
More in detail, the results achieved include the
following:
• completion of the “life cycle assessment (LCA)”
of three products chosen in order to determine
their carbon footprint with a view to optimizing
the energy performance, the environmental and
water impact. This target was achieved a year in
advance.
• The adoption of the “Eco-Design Guidelines” for
ten products has been finalized, consistent with
the target included in the Sustainability Manifes-
to as part of the objectives for 2023.
• The Group worked to manage energy resources
responsibly and the target calling for the electricity
used to be derived 100% from self-produced re-
newable energy or from certified renewable energy
networks was achieved two years in advance.
• The audits needed to obtain ISO 45001 certifica-
tion for workplace health and safety manage-
ment continued and certification was obtained
by one of the plants in China.
• With a view to Health & Safety, a campaign
aiming to raise awareness about health and
safety issues was launched by publishing a spe-
cific Manifesto and implementing a robust pro-
gram focused on the prevention of accidents at
the production facilities, including by also ap-
pointing company ambassadors.
• The DEI (Diversity, Equity and Inclusion) program
was launched and top management, along with
Human Resources, defined a program focused
on strengthening the presence of women in
managerial positions and supporting the reduc-
tion of the “gender pay gap”.
• The Sustainability Learning Journey was
launched and had an impactful beginning: with
the introduction of the intranet “Switch on” it was
possible to share topics and updates linked to the
Group’s sustainability path. The program also in-
cluded the “Sustainability Speech” which was
made by Nobel Prize Winner Prof. Joseph Stiglitz
at the Treviso headquarters. It was the source of
great inspiration for the entire company.
• Thanks to the new PULSE platform and the de-
velopment of e-learning the average hours of
training per employee increased (from 23 in
2022 to 24.3 in 2023), consistent with the target
included in the Sustainability Manifesto.
Sustainability was again identified as one of the key
enablers of the Medium-Term Plan 2021-2023,
which confirms the importance that the concept of
“Sustainable Success” has for the De’ Longhi
Group.
In 2023 the Group worked on revising and updating
the original Sustainability Plan approved by the
Board of Directors on 28 July 2022.
This updated Sustainability Plan was included in
the Medium-Term Plan 2024-2026 (approved by
the Board of Directors on 18 January 2024), con-
sistent with its role as one of the key enablers.
The Group is continuing with the work connected
to the tender of the Ministero dell’Università e della
Ricerca (MUR), part of the Piano Nazionale di
Ripresa e Resilienza (PNRR) which calls for the cre-
ation of at least 12 expanded partnerships, includ-
ing the Models for Sustainable Nutrition in partner-
ship with the University of Parma. The targets to
reach involve: prevention of waste, sustainability
and the circular supply chain, improved nutrition
and food sustainability in densely populated areas.
The Group also participated in the Italian Green
New Deal, a nationwide tender focused on
eco-friendly and circular transition projects.
Lastly, in 2023 the Group began its sponsorship of
two PhDs in Sustainable Design offered through
the Design Department at Milan’s Politecnico.
Sustainability
De’Longhi Group
|
01 The De’Longhi Group 7
Board of Directors
Giuseppe de’Longhi Chairman
Fabio de’Longhi Vice Chairman and
Chief Executive Officer
Massimiliano Benedetti** Director
Ferruccio Borsani** Director
Luisa Maria Virginia Collina** Director
Silvia de’Longhi Director
Carlo Garavaglia Director
Carlo Grossi ** Director
Micaela Le Divelec Lemmi ** Director
Maria Cristina Pagni Director
Stefania Petruccioli Director
External Auditors
PriceWaterhouseCoopers S.p.A. ***
Control, Risks, Corporate Governance
and Sustainability Committee
Luisa Maria Virginia Collina ** Chairman
Micaela Le Divelec Lemmi **
Stefania Petruccioli
Remuneration and Appointments Committee
Carlo Grossi ** Chairman
Ferruccio Borsani **
Carlo Garavaglia
Independent Committee
Luisa Maria Virginia Collina ** Chairman and
Lead Independent Director
Massimiliano Benedetti **
Micaela Le Divelec Lemmi **
* The current corporate bodies were appointed during the Shareholders’ Meeting held on 20 April 2022 for the three-year period 2022-2024.
On 21 April 2023, following the resignation of Massimo Garavaglia from his position as Chief Executive Officer and General Manager effective 31 August 2022, the Sharehold-
ers’ Meeting resolved to reduce the number of directors from 12 (twelve) to 11 (eleven) based on the sole proposal submitted by the majority shareholder De Longhi Industrial
S.A. for the remainder of the Board’s current term and, therefore, through the Shareholders’ Meeting convened to approve the 2024 Annual Report.
On 28 July 2022, as part of the Succession Plan Policy adopted by De’ Longhi S.p.A. in accordance with the Corporate Governance Code and applied subsequent to the resig-
nation of Massimo Garavaglia, the Board of Directors appointed the Vice Chairman Fabio de’ Longhi Chief Executive Officer effective as from 1 September 2022, pending the
identification of a new top manager. Effective again as from 1 September, Fabio de’ Longhi was also identified, pursuant to the Corporate Governance Code, as the Chief Exec-
utive Officer charged with the institution and management of De’ Longhi S.p.A.’s and the Group’s internal control and risk management system. On 22 December 2022, the
succession planning ended with the appointment of Nicola Serafin as the new General Manager (effective as from 1 January 2023) and the confirmation of Fabio de’ Longhi
as Chief Executive Officer.
** Independent directors.
*** Assigned by the shareholders’ meeting of 24 April 2018 for the financial years 2019-2027.
Company officers
*
Board of Statutory Auditors
Cesare Conti Chairman
Alessandra Dalmonte Standing member
Alberto Villani Standing member
Raffaella Annamaria Pagani Alternate auditor
Alberta Gervasio Alternate auditor
De’Longhi Group
|
01 The De’Longhi Group 8
Key performance indicators
Consolidated revenues
of €3,075.9 million
2019
2020
2021
2022
2023
2,101.1
2,351.3
3,221.6
3,158.4
Revenues
Growth rate
1.1%
11.9%
37.0%
-2.0%
-2.6%
196.6
6%
4%
4%
3%
1,874.6
56%
1,907.1
59%
623.4
26%
547.0
26%
7%
447.4
174.4
463.9
9%
2022
2022
Consolidated revenues by geographical area
Consolidated revenues by product category
Europe
Americas
Asia Pacific
MEIA
Coffee
Cooking and food preparation
Comfort
Cleaning and ironing
Other
(€/million)
3,075.9
2023
2023
De’Longhi Group
|
01 The De’Longhi Group 9
2022
2023
2022
2023
EBITDA
EBITDA/Net revenues
Operating NWC
Operating NWC/Net revenues
2022 NFP
Curr. op. & NWC mov.
Capex
Dividends
Net equity mov.
2023 NFP
298.8
584.3
(132.3)
(72.1)
(16.1)
662.6
EBITDA before non-recurring/stock option cost
of €444.2 million (14.4% of revenues).
NFP
at €662.6 million.
Operating cash flow and changes in NWC positive for €584.3 million.
Operating NWC
of €61.1 million (2.0% of revenues).
444.2
362.0
61.1
288.8
11.5%
2.0%
14.4%
9.1%
(€/million)
De’Longhi Group
|
01 The De’Longhi Group 10
Results
(€/million) 4th Quarter 2023 % 4th Quarter 2022 % Change Change %
Revenues 1,078.1 100.0% 1.029.8 100.0% 48.3 4.7%
Revenues at constant exchange rates 1,110.4 100.0% 1.027.7 100.0% 82.6 8.0%
Net industrial margin 518.1 48.1% 477.8 46.4% 40.3 8.4%
EBITDA before non-recurring/stock option costs 179.1 16.6% 150.0 14.6% 29.1 19.4%
EBITDA 176.9 16.4% 151.6 14.7% 25.3 16.7%
EBIT 146.8 13.6% 122.4 11.9% 24.4 20.0%
Profit (loss) pertaining to the Group 108.2 10.0% 78.0 7.6% 30.2 38.7%
(€/million) 2023 % 2022 % Change Change %
Revenues 3,075.9 100.0% 3.158.4 100.0% (82.5) (2.6%)
Revenues at constant exchange rates 3,147.7 100.0% 3.153.8 100.0% (6.1) (0.2%)
Net industrial margin 1,504.3 48.9% 1.493.3 47.3% 11.0 0.7%
EBITDA before non-recurring/stock option costs 444.2 14.4% 362.0 11.5% 82.2 22.7%
EBITDA 437.8 14.2% 369.4 11.7% 68.4 18.5%
EBIT 329.6 10.7% 263.5 8.3% 66.1 25.1%
Profit (loss) pertaining to the Group 250.4 8.1% 177.4 5.6% 72.9 41.1%
De’Longhi Group
|
01 The De’Longhi Group 11
Statement of financial position
(€/million) 31.12.2023 31.12.2022
Net operating working capital 61.1 288.8
Net operating working capital/Revenues 2.0% 9.1%
Net working capital (82.8) 142.9
Net capital employed 1,148.5 1,364.6
Net financial assets 662.6 298.8
of which:
- net bank financial position 761.7 389.5
- other financial receivables/(payables) (99.1) (90.7)
Net equity 1,811.1 1,663.4
De’Longhi Group
|
01 The De’Longhi Group 12
Introduction and definitions
This report contains forward - looking statements,
specifically in the “Outlook” section which, by
nature, have a component of risk and uncertainty
as they depend on future events and develop-
ments. At the date of this report, there is a high
level of uncertainty which is constantly changing
and calls for caution when making economic fore-
casts. The actual results could, therefore, differ
from the ones presented due to a number of
factors.
The figures at constant exchange rates are calcu-
lated excluding the effects of converting currency
balances and the accounting of derivative
transactions.
Report on operations
De’Longhi Group
|
02 Report on operations 14
Performance review
2023 was a positive year for the De’ Longhi Group
with gradual improvement in sales, which acceler-
ated in the fourth quarter, and good profitability and
cash flow generation.
Beginning in the second half of the year revenues
resumed a positive trajectory which gradually
gained momentum each quarter. The good perfor-
mance was supported by the expansion of the
coffee segment and personal blenders’ return to
growth.
Rigorous cost control, constant brand develop-
ment and a careful investment strategy made it
possible to improve margins, while good working
capital management, together with the improved
profitability, contributed to excellent cash flow
generation.
Revenues amounted to €1,078.1 million in the
fourth quarter of 2023, an increase of 4.7% com-
pared to the same period of 2022 (+8.0% at con-
stant exchange rates).
Revenues for the full twelve months, which
amounted to €3,075.9 million, were slightly lower
(-2.6%) than in 2022 due to the negative foreign ex-
change effect, net of which revenue would have
been largely in line with the prior year.
The performance posted in the twelve-month
period was impacted by the weakness seen in the
first part of the year linked to a few transitory and
one-off factors which eased or normalized during
the second half of the year that allowed for gradual
and constant recovery in sales in subsequent
quarters.
The performance was also affected by the Group’s
decision to exit the portable air conditioning market
in the United States; net of this discontinuity, 2023
revenues would have been largely in line with 2022.
The above dynamics also impacted the revenues
generated across the different geographies. In the
fourth quarter there was, in fact, an acceleration in
growth at constant exchange rates in all areas, with
the sole exception of America.
In Europe the Group reported revenues of €699.2
million in the fourth quarter, 11.0% higher than in
the same period of 2022; in the twelve-month
period revenues amounted to €1,907.1 million,
slightly higher than in 2022 (+1.7%).
In the fourth quarter Asia Pacific recorded reve-
nues of €150.7 million, slightly lower than in the
same period of 2022 (-1.5%), but higher by 4.8% at
constant exchange rates. In 2023 revenues came
to €447.4 million, a decrease of 3.6% against the
prior year.
MEIA closed the fourth quarter with revenues of
€44.4 million, an increase of 6.2% (+13.4% at con-
stant exchange rates) bringing the total for the year
to €174.4 million (-11.3%, or -7.9% at constant ex-
change rates).
In Americas revenues amounted to €183.7 million
(-10.3%, or -5.7% at constant exchange rates) in the
fourth quarter and €547.0 million in the twelve-
month period, a drop of 12.2% (-9.7% at constant
exchange rates). Net of the discontinuity in porta-
ble air conditioners, a 2.9% decrease in revenues
would have been recorded as consequence of a
negative exchange rates effect.
Looking at business lines, domestic coffee prod-
ucts reported sales growth in the year which accel-
erated in the fourth quarter. The positive results
were driven mainly by fully automatic machines
which benefitted from the launch of new models
and the new “Perfetto” campaign.
The growth trend for professional coffee ma-
chines continued with very positive results in both
revenues and profitability.
Despite closing the year down slightly against
2022, favorable dynamics in the second part of the
year helped food preparation return to growth sup-
ported mainly by NutriBullet personal blenders.
Sales for comfort were impacted noticeably by the
exit from the portable air conditioning market in the
United States, as well as the destocking of retail
distributors; in a few countries results were also
impacted by unfavorable weather conditions and a
weak heating season.
Home care, which includes irons and home care
products, recorded improvement in revenues
thanks to the contribution of Braun brand irons.
There was significant improvement in margins due,
above all, to lower supply chain costs attributable
to both lower unit transport costs and inventory, as
well as containment of operating costs.
The Group continued to pursue its strategy to
invest in advertising and promotional initiatives in
order to support the main brands and products, still
a high focus on optimization of expenditure. The
campaign “Perfetto” continued as did the collabora-
tion with Group ambassador which leds to a new
spot and the development of new initiatives linked
to a three-year partnership.
De’Longhi Group
|
02 Report on operations 15
The net industrial margin amounted to €518.1 mil-
lion or 48.1% of revenues in the fourth quarter of
2023, higher than in the same period of 2022
(€477.8 million, 46.4% of revenues). In the twelve-
month period the net industrial margin came to
€1,504.3 million or 48.9% of revenues (€1,493.3
million or 47.3% of revenues in 2022).
EBITDA before non-recurring income (expenses)/
stock option costs came to €179.1million (16.6% of
revenues) in the fourth quarter of 2023, higher both
numerically and as a percentage of revenue com-
pared to the same period of 2022 (€150.0 million,
14.6% of revenues). EBITDA before non-recurring
income (expenses)/stock option costs showed sig-
nificant improvement in 2023, also, coming in at
€444.2 million (14.4% of revenues) compared to
€362.0 million (or 11.5% in revenues) in 2022. This
positive trend reflects both lower productive and
logistics costs, stemming also from inventory con-
trol, and streamlining of operating costs.
In 2023 a few non-recurring items were recognized
which together generated net expenses of €5.5 mil-
lion (net income of €8.3 million in 2022). This item
reflects advisory fees and consultancies
connected to the La Marzocco/Eversys business
combination and the costs connected to company
reorganizations currently underway.
The Group also recognized €0.9 million in notional
stock option costs.
EBIT came to €146.8 million in the fourth quarter
(13.6% of revenues) versus €122.4 million (11.9%
of revenues) in the same period of 2022; in 2023
EBIT amounted to €329.6 million or 10.7% of
revenues.
Financial expenses amounted to €2.3 million, lower
than in 2022 (€25.3 million), thanks to financial
income from the investment of liquidity and effec-
tive currency management.
After taxes of €76.9 million, the Group’s portion of
net profit came to €250.4 million. (€177.4 million in
2022).
Looking at the balance sheet, there was a decided
decline in operating working capital, which came to
€61.1 million at 31 December 2023, both numerical-
ly (€288.8 million at 31 December 2022) and as a
percentage of rolling revenues (2.0% at 31 Decem-
ber 2023 versus 9.1% at 31 December 2022). The
change reflects effective management of inventory
and receivables, as well as higher trade payables
due to an increase in the volumes purchased.
Net working capital was negative for €82.8 million
(-2.7% of revenues) at 31 December 2023 versus
the positive €142.9 million (4.5% of revenues) re-
corded at the same date in 2022.
The net financial position came to a positive €662.6
million at 31 December 2023 (€298.8 million at 31
December 2022).
Net of a few specific financial items, including
mainly the fair value measurement of derivatives
and lease liabilities, the net financial position with
banks came to a positive €761.7 million (€389.5
million at 31 December 2022).
Operating cash flow and the movements in net
working capital were positive for €584.3 million in
2023 (positive €151.9 million in 2022) due to the
dynamics described above.
Total cash flow was positive for €363.8 million in
2023 after €132.3 million in investments and the
payment of €72.1 million in dividends, versus nega-
tive €126.3 million in 2022.
De’Longhi Group
|
02 Report on operations 16
Group results
The reclassified De’ Longhi Group consolidated income statement is summarized as follows:
(€/million) 2023 % revenues 2022 % revenues
Revenues 3,075.9 100.0% 3,158.4 100.0%
Change (82.5) (2.6%)
Materials consumed & other production costs
(production services and payroll costs)
(1,571.6) (51.1%) (1,665.1) (52.7%)
Net industrial margin 1,504.3 48.9% 1,493.3 47.3%
Services and other operating expenses (801.9) (26.1%) (889.1) (28.2%)
Payroll (non-production) (258.2) (8.4%) (242.2) (7.7%)
EBITDA before non-recurring/stock option costs 444.2 14.4% 362.0 11.5%
Change 82.2 22.7%
Non-recurring expenses/stock option costs (6.4) (0.2%) 7.4 0.2%
EBITDA 437.8 14.2% 369.4 11.7%
Amortization (108.2) (3.5%) (105.8) (3.4%)
EBIT 329.6 10.7% 263.5 8.3%
Change 66.1 25.1%
Net financial income (expenses) (2.3) (0.1%) (25.3) (0.8%)
Profit (loss) before taxes 327.3 10.6% 238.2 7.5%
Taxes (76.9) (2.5%) (58.4) (1.8%)
Net Result 250.4 8.1% 179.8 5.7%
Minority interests - 0.0% 2.4 0.1%
Profit (loss) pertaining to the Group 250.4 8.1% 177.4 5.6%
The net industrial margin reported in the reclassified income
statement differs by €235.7 million in 2023 (€240.2 million in
2022) from the consolidated income statement as, in order to
better represent the period performance, production-related
payroll and service costs have been reclassified from payroll
and services, respectively, and non recurring expenses have
been separately reported.
De’Longhi Group
|
02 Report on operations 17
(€/million)
4th Quarter
2023
%
4th Quarter
2022
% Change Change %
Change at constant
exchange rates %
Europe 699.2 64.9% 630.1 61.2% 69.1 11.0% 12.9%
Americas 183.7 17.0% 204.9 19.9% (21.1) (10.3%) (5.7%)
Asia Pacific 150.7 14.0% 153.0 14.9% (2.3) (1.5%) 4.8%
MEIA (Middle East/India/Africa) 44.4 4.1% 41.8 4.0% 2.6 6.2% 13.4%
Total revenues 1,078.1 100.0% 1,029.8 100.0% 48.3 4.7% 8.0%
(€/million) 2023 % 2022 % Change Change %
Change at constant
exchange rates %
Europe 1,907.1 62.0% 1,874.6 59.4% 32.5 1.7% 3.1%
Americas 547.0 17.8% 623.4 19.7% (76.3) (12.2%) (9.7%)
Asia Pacific 447.4 14.5% 463.9 14.7% (16.5) (3.6%) 2.4%
MEIA (Middle East/India/Africa) 174.4 5.7% 196.6 6.2% (22.2) (11.3%) (7.9%)
Total revenues 3,075.9 100.0% 3,158.4 100.0% (82.5) (2.6%) (0.2%)
In Europe the Group recorded revenues of €699.2
million in the fourth quarter of 2023, an increase of
11.0% compared to the same period in 2022. The
good performance recorded in the second part of
the year made it possible to close the twelve-month
period with revenues at €1,907.1 million, an in-
crease of 1.7% or 3.1% at constant exchange rates
compared to 2022.
Sales in the region’s main markets, above all Ger-
many and Italy, were impacted by the de-stocking
carried out by a few of the main retailers in the first
part of the year, but this trend normalized in subse-
quent quarters.
After a weak 2022, sales in France began to grow
again thanks to the gradual recovery of both
Revenues
Revenues amounted to €1,078.1 million in the
fourth quarter of 2023, an increase of 4.7% or 8.0%
at constant exchange rates.
The good performance is the result of a gradual in-
version in the trend begun in the second part of the
year, after the normalization of the non-recurring
transitory factors already described, which impact-
ed sales during the first few months of the year.
In 2023 the De’Longhi Group, penalized by the
weakness of the first part of the year, recorded rev-
enues of €3,075.9 million, largely in line with 2022
(-0.2%) at constant exchange rates and down
slightly at current exchange rates (-2.6%).
Markets
The overall performance described above was sim-
ilar across the regions which, with the sole excep-
tion of Americas, reported growth in the fourth
quarter at constant exchange rates and gradual re-
covery in the year.
The performance of revenues in the different com-
mercial regions is summarized as follows:
kitchen products, which benefitted from the contri-
bution of Nutribullet personal blenders, and coffee
machines.
In 2023 Germany, which showed greater resilience
in 2022 compared to the rest of the region, was
faced with a general economic slowdown in the
country due to rising inflation and weak consumer
confidence. Beginning in the second part of the
year, revenues began to recover. The main coffee
categories benefitted from the new advertising
campaign “Perfetto”. Sales for Comfort were down
as de-stocking by retailers and a mild summer
weighed on air conditioners.
The Italian market was, in general, impacted by the
factors described (de-stocking of retailers, higher
inflation, drop in demand) which resulted in a gen-
eralized weakness in both cooking and food prepa-
ration and coffee machines.
In the United Kingdom, after a weak 2022, there
was a positive sales trend in 2023. The growth was
fueled by coffee and comfort as air conditioners
benefitted from a favorable summer while heaters
were sustained by a solid fourth quarter which
largely compensated for the weakness seen in the
prior winter. Despite the impact of kitchen ma-
chines, in 2023 cooking and food preparation
posted a positive performance thanks to the contri-
bution of food processors and Nutribullet brand
personal blenders.
In Americas revenues benefitted from the positive
De’Longhi Group
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02 Report on operations 18
The fully automatic machines confirmed their suc-
cess and three DeLonghi’ models (Eletta Explore,
Magnifica EVO and PrimaDonna Soul) were award-
ed 1st, 2nd and 3rd place by Stiftung Warentest, an
independent German organization which assesses
product performance. The sales for high-end prod-
ucts were good, above all in the third and fourth
quarters, thanks to the new models designed for
new consumer targets like Eletta Explore and
De’Longhi Rivelia. To complete the product range,
new entry level products with an automatic cap-
puccino maker (like Magnifica Start Milk) were
launched.
A positive contribution also came from the innova-
tive bean to cup machine for drip coffee (True
Brew) launched in the United States in the first few
months of 2023.
The La Specialista line played an important role in
supporting sales, particularly in a few countries and
has strengthened the brand’s positioning and
market share globally.
The Nespresso product platform was impacted,
above all in a few European countries, by strong
competitive pressures.
The professional coffee machines, which have
become part of the traditional product families, re-
corded robust growth.
Eversys, leveraging on ever-increasing demand,
grew sales across all the traditional reference mar-
kets, specifically China, the United States and other
Asia Pacific countries, despite a market affected by
exchange rates.
Cooking and food preparation products closed the
year down slightly against 2022. Beginning in the
second half of the year, however, favorable trends
made it possible to offset the weakness recorded
in the third and fourth quarters.
After a weak 2022, in 2023 sales for personal
blenders posted a decided recovery in the United
States, the reference market for the Nutribullet
brand, and noticeable progress in new geographies
where the Group leveraged on its proven distribu-
tion network.
Nutribullet’s new personal blender Ultra was well
received by the market.
Food processors also delivered positive results
thanks to the new models MultiPro Go and Multi-
Pro Weigh XL.
The Kenwood brand kitchen machines, however,
continue to be weak and penalized strongly by
shrinking demand and significant competitive
and heaters were down due to unfavorable weather
conditions. In the second part of the year, specifi-
cally in the fourth quarter, the recovery accelerated.
Revenues for the fourth quarter and the year were
both impacted by the negative exchange effect.
In Japan revenues fell, despite coffee’s good perfor-
mance due to a mild winter which penalized radia-
tor sales.
In the fourth quarter MEIA recorded revenues of
€44.4 million, an increase of 6.2% compared to the
same period of 2022 (+13.4% at constant exchange
rates), despite the tensions in the Middle East mar-
kets due to the conflict which broke out in Gaza in
October. The year closed with revenues of €174.4
million, 11.3% lower (-7.9% at constant exchange
rates). There was a generalized decrease across
the entire region. Saudi Arabia and United Emirates
were impacted by de-stocking. There was a posi-
tive trend in Turkey where revenues benefitted from
reorganized distribution. Egypt recorded recovery
after two years of stagnation due to monetary poli-
cies and import restrictions.
Business lines
Revenues for home coffee products rose in 2023,
showing gradual growth beginning in the second
half of the year. Overall, the segment continues to
benefit from the trend to buy espresso machines
for home use, albeit at a slower pace than during
the pandemic.
The investments made in communication, specifi-
cally in the new “Perfetto” campaign, contributed
significantly to strengthening brand recognition
and the category’s success.
trend of sales of Nutribullet personal blender and
full automatic coffee machines, also thanks to the
launch of an innovative bean to cup machine for
drip coffee (True Brew). In the fourth quarter reve-
nues came to €183.7 million, a decrease of 10.3%
or 5.7% net the impact of the negative exchange
effect; this performance reflects commercial
issues with a client active in the capsule coffee ma-
chine segment and a weak heating season. Reve-
nues in the twelve-month period were also impact-
ed by the discontinuity in portable air conditioners
and dropped 12.2% (-9.7% at constant exchange
rates) to €547.0 million. Net of the discontinuity,
revenues would have been down by 2.9%, mainly
due to a negative exchange rates effect.
In the fourth quarter of the year Asia Pacific re-
corded revenues of €150.7 million, an increase of
4.8% compared to 2022 at constant exchange
rates, largely in line with the same period of 2022 at
current exchange rates (-1.5%). Revenues amount-
ed to €447.4 million in the year, down 3.6% com-
pared to 2022 due to the negative exchange effect
across the region’s main currencies; revenues
would have been 2.4% higher at constant exchange
rates.
Greater China, despite weak demand, recorded
solid growth thanks, in particular, to the good re-
sults for coffee products, including professional
machines. A new model of the fully automatic ma-
chine Rivelia was launched and well received by the
market.
After three years of strong expansion, the small ap-
pliances market in Australia and New Zealand fell
noticeably which weighed heavily on results. In the
first part of the year, revenues for dehumidifiers
De’Longhi Group
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02 Report on operations 19
pressures, particularly with respect to lower end
models.
In Europe a new Braun brand handblender Mul-
tiQuick 2 was launched in the first part of the year; a
high-end range of Braun brand grills, including its
flagship model MultiGrill9, was also launched in
Europe.
Comfort was impacted mainly by the discontinuity
in the American portable air conditioning market. In
Europe, despite a good sell-out level, the segment
was also impacted by the destocking of distribu-
tors. In a few markets sales were also impacted by
unfavorable weather conditions.
In Europe, portable air conditioners benefitted from
the introduction of the Pinguino A+++ model, but
growing competition resulted in price pressures.
Home care, which includes irons and home care
products, recorded improvement in revenues
thanks to the contribution of Braun brand irons. In
2023 four new models were launched, two for each
product family (irons and ironing systems) in order
to cover the low end and the high end of the market.
The new TextStyle 9, which is primarily for the Euro-
pean market (particularly Germany and Poland),
was launched in September. As for ironing sys-
tems, the CareStyle 7 line was expanded with the
introduction of an innovative ergonomic designed
certified by ErgoCert (an ergonomic certifier).
Profitability
In 2023 the Group showed strong recovery in mar-
gins which was obtained thanks to management
and optimization of industrial, operating and supply
chain costs as consequence of the containment of
the inventory and the decrease of ocean freight
tariffs.
In the fourth quarter of 2023 the net industrial
margin came to €518.1 million or 48.1% of reve-
nues, higher than in the same period of 2022
(€477.8 million, 46.4% of revenues). The net indus-
trial margin was €1,504.3 million or 48.9% of reve-
nues in 2023 (€1,493.3 million or 47.3% of revenues
in 2022).
EBITDA before non-recurring income (expenses)/
stock option costs came to €179.1million (16.6% of
revenues) in the fourth quarter of 2023, higher both
numerically and as a percentage of revenue com-
pared to the same period of 2022 (€150.0 million,
14.6% of revenues). EBITDA before non-recurring
income (expenses)/stock option costs showed sig-
nificant improvement in 2023, also, coming in at
€444.2 million (14.4% of revenues) compared to
€362.0 million (or 11.5% in revenues) in 2022. This
performance benefitted from the reduction of in-
dustrial and logistic costs, as well as from the ra-
tionalization of operating expenses. The Group also
continued to invest in advertising and promotional
initiatives in order to support the main brands, but
paid particular attention to optimizing costs.
In 2023 a few non-recurring items were recognized
which together generated net expenses of €5.5 mil-
lion (net income of €8.3 million in 2022). This item
reflects advisory fees and consultancies connect-
ed to the La Marzocco/Eversys business combina-
tion and the costs connected to ongoing company
reorganizations.
The Group also recognized €0.9 million in notional
stock option costs in the reporting period.
Amortization and depreciation amounted to €30.1
million in the fourth quarter of 2023, largely in line
with the same period of 2022 (€29.3 million); in the
twelve-month period amortization and deprecia-
tion were higher than in the prior year due to the
completion of a few investments made in the
second part of 2022.
EBIT came to €146.8 million in the fourth quarter
(13.6% of revenues) versus €122.4 million (11.9%
of revenues) in the same period of 2022; in 2023
EBIT amounted to €329.6 million or 10.7% of reve-
nues, an improvement with respect to (€263.5 mil-
lion, 8.3% of revenues).
Financial expenses came to €2.3 million, lower
than in 2022 (€25.3 million), thanks to financial
income from the investment of liquidity and effec-
tive currency management.
After taxes of €76.9 million, the Group’s portion of
net profit came to €250.4 million. (€177.4 million in
2022).
De’Longhi Group
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02 Report on operations 20
Operating segment
disclosures
The De’ Longhi Group has identified three operating
segments which coincide with the Group’s three
main business regions: Europe, MEIA (Middle East,
India and Africa) and APA (Asia, Pacific, Americas).
Each segment is responsible for all aspects of the
Group’s brands and serves different markets.
This breakdown is in line with the tools used by
Group management to run operations, as well as
evaluate the company’s performance and make
strategic decisions.
The results by operating segment can be found in
the Explanatory Notes.
De’Longhi Group
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02 Report on operations 21
Review
of the statement
of financial position
The reclassified consolidated statement of financial position is presented below:
(€/million) 31.12.2023 31.12.2022
- Intangible assets 878.3 891.2
- Property, plant and equipment 478.0 448.1
- Financial assets 9.7 11.7
- Deferred tax assets 60.4 64.6
Non-current assets 1,426.4 1,415.6
- Inventories 504.7 550.7
- Trade receivables 272.7 278.8
- Trade payables (716.2) (540.7)
- Other payables (net of receivables) (143.9) (145.8)
Net working capital (82.8) 142.9
Total non-current liabilities and provisions (195.1) (194.0)
Net capital employed 1,148.5 1,364.6
(Net financial assets) (662.6) (298.8)
Total net equity 1.811.1 1,663.4
Total net debt and equity 1,148.5 1,364.6
Net financial position as at 31 December 2023 includes € 99.1 million in net financial liabilities (net financial liabilities equal to € 90.7
million at 31 December 2022) relating to the fair value of derivatives and the financial debt connected to business combinations,
pension fund and financial liabilities for leasing.
In 2023, the Group made net investments of €132.3
million (versus €156.2 million in 2022 which includ-
ed the purchase of the new plant in Romania), at-
tributable for €18.7 million to intangible fixed
assets relating mainly to new products and pat-
ents, for €40.1 million to new leases and for €74.7
million to fixed assets, mainly improvements made
in order to expand the capacity of the production
facilities.
There was a decided decline in net operating work-
ing capital, which came to €61.1 million at 31 De-
cember 2023, both numerically (it reached €288.8
million at 31 December 2022) and as a percentage
of rolling revenues (2.0% at 31 December 2023
versus 9.1% at 31 December 2022). After the con-
tainment actions taken in the prior year, in 2023 in-
ventory was largely stable with an increase linked
to year-end sales and closed the year at €504.7
million, lower than at 31 December 2022 (€550.7
million). Despite the increase in sales in the fourth
quarter, collection of trade receivables went well,
while trade payables were higher due to the timing
and increase in procurement.
Net working capital was negative for €82.8 million
(-2.7% of revenues) at 31 December 2023 versus
the positive €142.9 million (4.5% of revenues) re-
corded at the same date in 2022.
De’Longhi Group
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02 Report on operations 22
The statement of cash flows is presented on a condensed basis as follows:
(€/million) 2023 2022
Cash flow by current operations 446.3 340.0
Cash flow by changes in working capital 138.0 (188.0)
Cash flow by current operations and changes in NWC 584.3 151.9
Cash flow by investment activities (132.3) (156.2)
Cash flow by operating activities 452.0 (4.3)
Dividends paid (72.1) (124.5)
Stock options exercise 5.1 3.4
Cash flow by other changes in net equity (21.2) (0.9)
Cash flow generated (absorbed) by changes in net equity (88.2) (122.0)
Cash flow for the period 363.8 (126.3)
Opening net financial position 298.8 425.1
Closing net financial position 662.6 298.8
The good generation of operating cash flow and the containment of working capital resulted in positive
cash flow in the twelve months of €584.3 million (negative for €151.9 million in 2022).
Total cash flow was positive for €363.8 million in 2023 after €132.3 million in investments and the payment
of €72.1 million in dividends, versus negative €126.3 million in 2022.
Details of the net financial position are shown below:
(€/million) 31.12.2023 31.12.2022
Cash and cash equivalents 1,250.2 770.2
Other financial receivables 172.5 368.4
Current financial debt (289.0) (190.5)
Net current financial position 1,133.6 948.1
Non-current financial receivables and assets 122.0 124.6
Non-current financial debt (593.1) (774.0)
Non-current net financial debt (471.0) (649.3)
Total net financial position 662.6 298.8
of which:
- positions with banks and other financial payables 761.7 389.5
- lease liabilities (98.4) (80.5)
- other financial non-bank assets/liabilities (fair value of
derivatives, financial debt connected to business combinations
and pension fund)
(0.7) (10.2)
The net financial position came to a positive €662.6 million at 31 December 2023 (€298.8 million at 31 De-
cember 2022).
This includes a few specific financial items, including mainly the fair value measurement of derivatives
which had a net negative balance of €0.7 million at 31 December 2023 (at 31 December 2022 this included
the residual debt for business combinations and pension fund transactions which had a negative balance of
€10.2 million).
The item also includes lease liabilities recognized in accordance with IFRS 16 which amounted to €98.4
million at 31 December 2023 (vs. €80.5 million at 31 December 2022).
Net of these items, the net financial position with banks came to a positive €761.7 million (€389.5 million at
31 December 2022).
De’Longhi Group
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02 Report on operations 23
Operations,
supply chain
and quality control
In 2023 the Group continued with investments on
multiple fronts.
Looking at the supply chain, implementation of the
global Customer Fulfillment Excellence program
continued in order to improve the level of customer
service by redesigning and increasing the transpar-
ency of the processes used in planning and the au-
tomation of production, as well as in distribution
flow and processes.
The Group also continued to implement procure-
ment strategies which focused on more evolved
and complete relationships with suppliers, creating
new synergies, particularly with respect to the
co-designing and development of technological
platforms, consistent with the commitment to pro-
moting sustainability along the supply chain and
the environmental awareness of the suppliers, as
well as encouraging fair behavior.
As for production, the Group sought to improve
flexibility in response to increasingly volatile
demand. Investments were made in increasing the
production capacity in Romania and Cina.
The automation and digitalization of the European
plants begun in the last few years continued.
The ISO 45001 certification process for the Swiss
headquarters of Eversys was also completed.
De’Longhi Group
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02 Report on operations 24
Research
and development
In 2023 the Group continued to work on the devel-
opment of innovative and sustainable products, in-
corporating environmental criteria in the planning
process in order to minimize the footprint associat-
ed with procurement, production, distribution, use
and obsolescence. The Group was also committed
to reducing the environmental impact of packaging
used during the production processes and for prod-
ucts, to promoting a model based on the use of re-
newable materials and reducing consumption
along the value chain, as well as contributing to the
fight against climate change by using low carbon
emitting and highly energy efficient products.
Looking at the fully automatic coffee machines, in-
novative products with characteristics which are
unique to the market were launched (i.e. Rivelia)
and development of the projects developed to
reduce water consumption and improve descaling
time and efficiency continued in 2023.
All the packaging for the manual machines was
switched from Styrofoam to paper, cellulose paste, etc.
The developments in the cooking and food prepa-
ration products segment involved, above all, as-
pects related to practicality, size and the use of in-
novative, sustainable materials in products and
packaging.
As for comfort, research was focused on the new
A+++ energy efficient portable air conditioner,
made largely out of recycled materials.
With respect to home care, specifically irons, the
Group worked on reliability, durability and the com-
pactness of the product, while also focusing on
high ergonomic standards, optimization of energy
consumption and the use of sustainable materials.
De’Longhi Group
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02 Report on operations 25
Communication
activities
In 2023 the Group continued to invest in promotion-
al activities and communication, consistent with
the direction taken in previous years, as well as ac-
tions to improve optimization and efficiency.
With regard to the De’Longhi brand, investments in
communication remained solid and involved coffee
machines, in particular.
In September the new fully automatic machine
Rivelia was presented to a few markets. Rivelia has
an innovative design, size and Bean Switch System
which makes it possible to use different coffee
beans, along with an intuitive touch screen display.
At the same time, the “Perfetto 2.0” campaign was
launched which, once again, stars Brad Pitt as part
of an ongoing, three-year collaboration. The cam-
paign, which focuses on four different models
(Eletta Explore, Rivelia, La Specialista Arte and La
Specialista Maestro), aims to strengthen the posi-
tioning of the De’Longhi brand in the premium
segment.
As for the social networks, there was a significant
increase in the followers, contacts and content,
both locally and globally; key messages were
posted which, through local channels, were inter-
preted based on the target audience.
The Coffee Lounge platform was launched in five
more markets which, together with the prior
launches, makes it possible to reach an increasing
number of coffee roasters.
Lastly, with regard to sustainability, the Group sup-
ported the World Coffee Research and the Slow
Food Coffee Coalition; this collaboration gave birth
to De’Longhi’s first specialty coffee which came
from a Slow Food Community source which con-
tributes to the development of sustainable practic-
es in the coffee industry.
As for the Kenwood brand, in 2023 the Group con-
tinued to invest in the “Kenwood Can” campaign,
which focused on kitchen machines and food
processors.
With the launch of the MultiPro Go food processor,
in order to reach a younger audience the Group in-
troduced a new approach to communication
based, above all, on platforms like TikTok and Insta-
gram. The success of the “Kenwood Club” contin-
ued. It is now operative in more than ten European
markets.
Lastly Kenwood’s commitment to reducing food
waste continued through a dedicated campaign
which aims to promote sustainable consumption
by educating the consumer with the recipes to be
made using the Group’s products.
With respect to Braun, during the year all the new
model launches were supported by a specific com-
munication campaign. “The Grillwhisperer” cam-
paign was developed specifically for the launch of
the MultiGrill line. The Sustainability Manifesto was
also shared with the public through the continuous
development of content in which the quality and
durability of the Braun products is stressed as part
of a lifestyle informed by a lower environmental
impact.
In 2023 further investments were made in increas-
ing the global brand awareness of the Nutribullet
brand with a focus on the core category of personal
blenders; the activities contributed to increase the
impact on the product’s target customers.
De’Longhi Group
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02 Report on operations 26
Human Resources
Here follows a detail of the average workforce in
2023:
2023 2022
Blue collars 6,437 5,928
White collars 3,185 3,226
Managers 304 296
Total 9,926 9,450
The Group had an average of 9,926 employees in
2023, an increase of 476 heads compared to 2022
which is attributable mainly to personnel at produc-
tion facilities and the recovery in production follow-
ing a temporary slowdown in 2022 and the devel-
opment of the professional coffee machines
segment.
The Group’s Human Resources division was active
on multiple fronts in 2023.
Firstly, with regard to health and workplace safety, a
global campaign was launched which aims to
strengthen and spread a safety culture. The
initiative involved both the headquarters and com-
mercial branches, as well as the production facili-
ties. A few employees were chosen and trained to
act as ambassadors in order to encourage and
spread greater awareness about how to contribute
to the prevention of possible accidents.
The Talent Attraction and Employer Branding activi-
ties also continued. In Italy relationships with uni-
versities were strengthened which made it possible
to begin specific recruiting campaigns, attract re-
sources with a solid academic background and ex-
pertise consistent with business needs, as well as
plan and implement specific training programs for
employees.
Numerous Diversity, Equity & Inclusion initiatives
continued. More specifically, a quantitative and
qualitative analysis of the Group’s people was car-
ried out in order to understand areas in need of
improvement.
For more information on Human Resources man-
agement refer to the specific section of the Non-Fi-
nancial Statement.
De’Longhi Group
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02 Report on operations 27
Report
on corporate governance
and ownership structure
De’ Longhi S.p.A.’s Report on Corporate Governance
and Ownership Structure drawn up in accordance
with art.123 - bis of Legislative Decree n. 58/98
(“TUF”) can be found in a report not included in the
Report on Operations, published at the same time as
the latter and available on the company’s website
www.delonghigroup.com (section Home > Govern-
ance > Corporate bodies > Shareholders’ Meeting
2024).
Pursuant to art.16.4 of the Market Regulations
please note that De’ Longhi S.p.A. is not subject to
the direction and control of the parent company De
Longhi Industrial S.A., or of any other party, pursuant
to and in accordance with articles 2497 et seq of the
Italian Civil Code, insofar as (i) the Group’s business,
strategic and financial plans, as well as the budget,
are approved independently by De’ Longhi S.p.A.’s
Board of Directors; (ii) the financial and funding poli-
cies are defined by De’ Longhi S.p.A.; (iii) De’ Longhi
S.p.A. conducts its relationships with clients and
suppliers in full autonomy; and (iv) in accordance
with the principles of the Corporate Governance
Code, important strategic, economic, equity and fi-
nancial transactions are examined by the board and
approved exclusively by the Board of Directors.
De’Longhi Group
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02 Report on operations 28
Risk management
and internal control system
relating to the financial
reporting process
Introduction
The Issuer’s and the De’ Longhi Group’s Internal
Control System consists in the set of rules, proce-
dures and organizational structures set in place to
ensure that company strategies are adhered to
and, based on the corporate governance standards
and model included in the COSO report (Committee
of Sponsoring Organizations of the Treadway Com-
mission), to guarantee:
a. efficient and effective company operations (ad-
ministration, production, distribution, etc.);
b. reliable, accurate, trustworthy and timely eco-
nomic and financial information;
c. compliance with laws and regulations, as well
as the corporate articles of associations, rules
and company procedures;
d. safeguarding of the company’s assets and pro-
tection, to the extent possible, from losses;
e. identification, assessment, management and
monitoring of the main risks.
The executive administrative bodies of the Parent
Company De’ Longhi S.p.A. (Board of Directors, the
Risk and Control, Corporate Governance and Sus-
tainability Committee, Director in Charge of the In-
ternal Control and Risk Management System), the
Board of Statutory Auditors, the Director of Internal
Audit, the Supervisory Board, the Chief Financial
Officer/Financial Reporting Officer and all De’
Longhi personnel, as well as the Directors and Stat-
utory Auditors of the Issuer’s subsidiaries, are in-
volved in the controls, with different roles and in
function of their expertise and adhere to the recom-
mendations and principles found in the guidelines.
The Internal Control System that is subject to ex-
amination and periodic audits, taking into account
changes in the company’s operations and refer-
ence context, makes it possible to address the
main risks to which the Issuer and the Group are
exposed to over time, in a timely manner, as well as
to identify, assess and control the degree of the ex-
posure of the Issuer and all the other companies of
the De’ Longhi Group - particularly the strategically
important subsidiaries - to the different types of
risk, and also makes it possible to manage the
overall exposure taking into account:
i. the possible correlations between the different
risk factors;
ii. the probability that the risk materializes;
iii. the impact of the risk on the company’s
operations;
iv. the overall impact of the risk.
The internal control and risk management system
relating to the financial reporting process (adminis-
trative and accounting procedures used to draft the
separate and consolidated annual financial state-
ments and the other economic and/or financial re-
ports and disclosures prepared in accordance with
the law and/or regulations, as well as ensuring cor-
rect implementation) coordinated by the Chief Fi-
nancial Officer/Financial Reporting Officer, is an inte-
gral and essential part of the De’ Longhi Group’s
Internal Control and Risk Management System.
The Director of Internal Audit - who is in charge of
verifying that the internal control and risk manage-
ment system works efficiently and effectively - pre-
pares a work plan each year that is presented to the
Board of Directors for approval, subject to the posi-
tive opinion of the Risk and Control and Corporate
Governance and Sustainability Committee and after
having consulted with the Board of Statutory Audi-
tors and the Director in Charge of the Internal Con-
trol and Risk Management System, based also on
the comments made by the Chief Financial Officer/
Financial Reporting Officer, as well as pursuant to
Legislative Decree 262/05. Discusses the steps
taken to resolve any problems, to make the improve-
ments agreed upon, as well as the results of the test-
ing activities with the Risk and Control and Corpo-
rate Governance and Sustainability Committee.
Provides the Chief Financial Officer/Financial Re-
porting Officer, as well as the administrative body
assigned, with a summary report based on which
they can assess the adequacy and application of
administrative procedures to be used to prepare
the consolidated financial statements.
Description of main characteristics
The De’ Longhi Group uses a system of risk man-
agement and internal control for the financial re-
porting process that is part of the wider system of
internal controls as required under art. 123-bis par.
2.(b) of TUF.
For the purposes of ensuring reliable internal con-
trols over its financial reporting, the Group has im-
plemented a system of administrative and ac-
counting procedures and operations that include
an updating in order to comply with the law and
changing accounting standard, rules for consolida-
tion and interim financial reporting, as well as coor-
dination with subsidiaries as needed.
The Group’s central corporate functions are re-
sponsible for managing and communicating these
procedures to other Group companies.
The assessment, monitoring and continuous up-
dating of the internal control system relating specif-
ically to financial reporting is carried out in accord-
ance with the COSO model and, where applicable,
Law 262/2005. Critical processes and sub-pro-
cesses relating to the principal risks have been
identified in order to establish the principal controls
needed to reduce such risks. This has involved
identifying the strategically important companies,
based on quantitative and qualitative financial pa-
rameters (i.e. companies that are relevant in terms
of size and companies that are relevant just in
terms of certain processes and specific risks).
Having identified these companies, the risks have
been mapped and assessed and the key manual
De’Longhi Group
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02 Report on operations 29
and automatic controls have been identified and
rated as high/medium/low priority accordingly;
these controls have then been tested.
The perimeter of the companies included in the
mapping for the purposes of Law 262/2005 has
changed over the years to reflect the changes in the
Group, both quantitative and qualitative, and this
perimeter was also considered for the definition of
companies viewed as strategic.
The general managers and administrative heads of
each Group company are responsible for maintain-
ing an adequate internal control system and, given
their roles, must certify that the internal control
system works properly.
Internal Audit must also include verification of the
internal controls through the use of a self-assess-
ment check list in its Audit Plan.
With regard to compliance with Consob Regulation
20249 of 28 December 2017 and subsequent
changes relating to market regulations (“Regola-
mento Mercati”), De’ Longhi S.p.A. controls, directly
or indirectly, seven companies formed and regulat-
ed by the law of countries that are not part of the
European Union considered relevant pursuant to
art. 151 of the issuer regulations (“Regolamento
Emittenti”).
With reference to the requirements of art. 15 of the
Market Regulations, it is reported as follows:
• in the issuer’s opinion, these companies have
suitable accounting and reporting systems for
regularly providing management and the audi-
tors of De’ Longhi S.p.A. with all the financial in-
formation needed to prepare the consolidated fi-
nancial statements and perform the audit of the
accounts;
• these companies provide the auditors of De’
Longhi S.p.A. with the information needed to
audit the parent company’s interim and annual
financial statements;
• the issuer keeps the articles of association of the
aforementioned companies and details of their
company officers and related powers, which are
constantly updated for any changes in the same;
• the financial statements of such companies, pre-
pared for the purposes of the De’ Longhi Group’s
consolidated financial statements, have been
made available in the manner and terms estab-
lished by existing law. Please note that the identi-
fication and analysis of the risk factors con-
tained in this report were carried out including in
light of the change in strategic companies as re-
solved by the Board of Directors.
In order to identify and manage the Company’s
main risks, with regard particularly to corporate
governance and compliance with the law and regu-
latory standards (including, specifically the recom-
mendations found in the Corporate Governance
Code for Listed Companies), the De’ Longhi Group
undertook to develop and monitor a structured En-
terprise Risk Management model.
The purpose underlying the implementation and
deployment of the Enterprise Risk Management
(ERM) system is to strengthen the risk control and
management system by mapping the main risks to
which the Group is exposed along its value chain,
identifying the inherent and relative residual risk, as
well as defining and implementing the actions
needed to eliminate and/or mitigate them.
The ERM system also includes a list of risks con-
nected to sustainability.
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02 Report on operations 30
This reflects the gradual integration of environmen-
tal and social sustainability, as well as governance,
in the corporate strategy, risk management and
compensation processes, promoting a systemic
and transparent approach, respectful of the stand-
ards found in the Code of Ethics, with a view to also
guaranteeing diversity, equal opportunity, fairness
and no discrimination of any kind. These risks also
include climate change.
In 2023 the on-boarding process was completed at
all the branches acquired in the prior year. In a con-
text characterized by an uncertain and complex
business landscape, periodic changes were made
to the risk scenarios in the main markets and the
production plants. A large group of international
managers was involved in revisiting and updating
the most imminent and impactful risks. At the
same time, the Management Teams of the compa-
nies involved revised the risk map and determined
what they viewed as the most critical risks.
Similar to the prior year, concerns about the global
market conditions continued to dominate in vari-
ous markets. Moving toward a period of post-pan-
demic normalization, the Group faced changes in
the business environment, including the transfor-
mation of the consumers’ preferences, supply
chain difficulties and challenges associated with
technological innovation.
From 2021 to 2023, the operational progress fueled
significant advantages, facilitating timely decisions
in response to global uncertainties. Crucial initia-
tives like the digitalization of the supply chain, di-
versification of the suppliers and centralization of a
few activities at corporate headquarters made it
possible to improve estimates, made the integrated
planning process more efficient, made procure-
ment more flexible and intensified automation of
operations. These measures strengthened the
Group’s operating resilience considerably, as
proven by the quick reaction to the risks associated
with recent logistics issues, like problems in the
Suez Canal.
In order to further strengthen the monitoring of
risks, Internal Audit will monitor exogenous risk fac-
tors closely, deepen the understanding of the ERM
principles and will make ad hoc revisions to risk to-
gether with headquarter departments and local
management during the year. This goal will be
achieved by improving specific tools and launching
new initiatives destined to increase risk
awareness.
Risk factors for the De’ Longhi Group
The risk factors to which the Group is exposed and
that could have a material impact on the De’ Longhi
Group’s business are summarized below.
These risk factors also take into account the above
mentioned ERM project and the assessments car-
ried out in current year and in prior years including
through more in-depth analyses shared with the
Risk, Control, Corporate Governance and Sustaina-
bility Committee and De’ Longhi S.p.A.’s Board of
Statutory Auditors.
With regard to the main risks highlighted below, the
De’ Longhi Group constantly monitors any situa-
tions and changes in macroeconomic and market
trends, as well as demand, in order to implement
any necessary and timely strategic actions.
In addition to the risk factors and uncertainties
identified in this report, other risks and events not
currently foreseeable or thought unlikely, could also
influence the business, the economic and financial
conditions and prospects of the De’ Longhi Group
1 - Risks relating to macroeconomic trends:
the De’ Longhi Group’s economic perfor-
mance and financial position are also affect-
ed by macroeconomic trends such as:
The main risk factors relate to:
• consumer trends;
• the cost of raw materials;
• interest rates and the foreign exchange markets;
• any policy changes made in a few key markets;
• any disturbances, riots and strikes or other types
of demonstrations;
• any epidemics and/or serious health related situ-
ations (like the prolonged coronavirus
emergency).
The current situation of general instability material-
ized at the same time in the world’s main developed
economies, albeit to varying degrees and for differ-
ent reasons. In Europe, the conflict in Ukraine and
logistical disruptions due to the crisis in the Red
Sea impact investments and the availability of
products in the markets, as well as influencing the
on-time delivery of components to European pro-
duction plants. In China, a slowdown in economic
growth is observed combined with a crisis in the
real estate sector. In the USA, intense inflationary
pressures, due to fiscal policies, and the risk of a
recession triggered by significant increases in inter-
est rates. The conflict in Gaza also contributed to
the deterioration of a situation of great instability in
countries in the Middle East.
The Group monitors these economic trends period-
ically in order to take quick strategic action as
needed.
The Group is also subject to the risks stemming
from local conflicts which can also affect key mar-
kets, as was the case in Ukraine.
These events are not foreseeable, but as a result of
past experiences the Group is able to react and im-
plement all the measures needed to limit the con-
sequences, as was the case in 2020/2021 when,
due the global health crisis, the Group had to face
an unprecedented level of market uncertainty.
The persistence of these situations, however, could
interrupt and/or limit the Group’s activities which
would have an impact on economic and financial
results.
2 - Socio-political risks relating to market
trends and demand, and to the Group’s pres-
ence in emerging markets. The De’ Longhi
Group does business in many foreign mar-
kets, primarily on a direct basis and through
agreements in certain emerging countries
like China.
The Group has therefore long had the characteris-
tics typical of a multinational company and this in-
evitably exposes it to a number of risks relating to
economic conditions and policies of the individual
countries in which it operates.
De’Longhi Group
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02 Report on operations 31
These risks not only affect consumption trends in
the various markets concerned, but may also be
relevant in terms of concentration of the Group’s
production sites in foreign markets if polices were
introduced that limit or restrict foreign investment,
imports and exports or capital repatriation.
These are systemic risks, common to all business-
es, for whom the ability to generate value depends
first on the dynamics and size of the market and
only second, on their ability to compete and consol-
idate/acquire the largest possible market share.
The Group, in the persons of the Chief Executive
Officer, and the division and market managers, con-
stantly monitor market trends in order to promptly
seize opportunities to increase business and to
assess the likelihood of any risks (and their poten-
tial effects on the Group’s results).
Any political and econonmic events that occur in
the markets where the De’ Longhi Group operates
(particularly in emerging markets) could have an
unfavorable economic and financial impact.
3 - Risks relating to strong competition in the
sectors in which the De’ Longhi Group op-
erates: the business in which the De’ Long-
hi Group operates is highly competitive and
there is a tendency for the business to be con-
centrated in a few important players which
puts strong pressure on margins.
The Group competes with other major international
industrial groups. The target markets are highly
competitive in terms of product quality, innovation,
price, energy saving, reliability, safety and assis-
tance. The market is also impacted by any consum-
ers habits/preferences change.
The preferred sales channel (the trade) is, further-
more, becoming increasingly more concentrated in
a few international players in several of the main
markets, including due to the exponential growth of
e-commerce.
The Group, therefore, must adopt effective strate-
gies to offset this risk. Toward this end, the strength
of the brands and ability to have an adequate retail
offering are key.
The inability to address its external environment ef-
fectively could have a negative impact on the
Group’s business prospects, as well as on its eco-
nomic results and financial position.
4 - Risks involved in relation to supply agree-
ments and strategic alliances: the Group also
operates through agreements with strategic
partners that foresee the development, pro-
duction and marketing of products, particu-
larly coffee makers sold in international mar-
kets.
Consequently, the Group’s failure to maintain or
renew these agreements could impact consolidat-
ed economic results and the financial position.
These agreements, which are generating very posi-
tive results in terms of growth and development as
well as full satisfaction both for De’ Longhi Group
and for strategic partners, are carefully managed
and monitored by top management.
De’Longhi Group
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02 Report on operations 32
5 - Risks relating to the De’ Longhi Group’s
ability to achieve continuous product inno-
vation: the De’ Longhi Group’s ability to gen-
erate value also depends on the ability of its
companies to offer technologically innovative
products that respond to market trends.
In this respect, the Group is still proving to be a
leader in technological innovation and in creating
new in-vogue designer products, also thanks to the
importance it places on those working in product
development and design, which it intends to main-
tain in the future.
In particular, if the Group were unable to develop
and continue to deliver innovative, competitive
products relative to its major competitors in terms
of price, quality and functionality, amongst others,
or if there were delays in the market launch of
models strategic to its business, the Group could
lose market share, with an adverse impact on its
business prospects, as well as on its economic per-
formance and/or its financial position.
6 - Risks relating to patents and trademarks.
Given the importance of developing products
that are innovative in both technology and
design (see point 5 above), the Group pursues
a policy of protecting its research and devel-
opment by registering patents for inventions,
utility models and designs in the various mar-
kets concerned; similar protection must be
assured for the Group’s trademarks.
The Group’s legal offices are responsible for the
legal protection of industrial property rights (pat-
ents for inventions, utility models, designs and
models as well as trademarks) and constantly
monitor and control the situation around the world,
using the services of specialist consultants in the
various countries concerned.
Such actions cannot absolutely guarantee that the
Group’s products will not be imitated and further-
more, certain jurisdictions (such as China and the
United Arab Emirates) do not protect property
rights to the same extent as European law.
The Group’s policy is nonetheless based on incur-
ring the necessary costs to ensure that its property
rights have the greatest possible global protection
in the various markets where it operates.
Moreover, there is no guarantee that protection of
the industrial property rights still in the registration
process (and, in particular, patents for inventions
and utility models) will be actually granted as filed,
since the extent of protection may be reduced -
even significantly - not only as a result of technical
examination by the competent office but also as a
result of opposition to the registration and licensing
of the rights that might be presented by third
parties.
Lastly, although the Group does not believe that its
products infringe third-party property rights, it is
not possible to exclude that third parties might suc-
cessfully claim that such infringements exist, in-
cluding through legal proceedings.
7 - Exchange rate fluctuation risks: The Group
does business in many foreign markets and is
exposed to the risk of fluctuations in currencies.
The unfavourable trend as well as the aforemen-
tioned exposure to the currency risk, might lead to
unexpected loss in margins, especially in some
specific markets where the subsidiaries of the
Group operate.
For the purposes of protecting its income state-
ment and statement of financial position from such
fluctuations, the Group adopts a suitable hedging
policy and tools, free from speculative
connotations.
Hedging is carried out centrally by a special team
on the basis of information obtained from a de-
tailed reporting system, using instruments and pol-
icies that comply with international accounting
standards. The hedging activity is planned each
year when the annual budget is approved (or when
the three-year plan is approved) and updated peri-
odically based on the exposures and the definition
of an effective hedging horizon, in order to mini-
mize the volatility of the currency portfolio and
maximize the benefit of the hedge; the financial and
trade receivables/payables are also protected. As
for the hedging of the economic risk of costs and
revenues, the degree of hedging is defined based
on market performance and a cost/benefit
analysis.
The main currencies to which the Company is ex-
posed are the Chinese renminbi and the currencies
of the main export markets (the British sterling, the
Japanese yen, the Australian dollar, the Polish zloty,
the Canadian dollar, etc). The US dollar is a curren-
cy which is basically a natural hedge insofar as
sales in the USD have increased in the past few
years to the extent that purchases can be offset in
the same currency. Significant fluctuations in the
main currencies could also increase the translation
risk stemming from the conversion of financial
statements of the Group’s foreign subsidiaries, re-
sulting in higher financial charges.
Despite the Company’s effort to minimize these
risks, sudden currency fluctuations could have an
adverse impact on the Company’s results and busi-
ness prospects.
8 - Risks relating to manufacturing, commod-
ity prices and supplier relationships.
Production is carried out at facilities in Italy, Roma-
nia and China and, therefore, balanced across three
different geographic regions which reduces the risk
that operations will be interrupted.
The Group’s production costs are influenced by the
prices and the availability of the most important
raw materials like steel, plastic and copper. Energy
costs may also have a significant impact on pro-
duction costs, as happened recently when strong
inflation, exacerbated, in Europe, by the conflict in
Ukraine, drove energy prices higher.
A significant portion of the purchases are made in
China; the related risks are associated with produc-
tion by Chinese subsidiaries that serve as suppliers
to the Group, by the network of key third-party sup-
pliers and by suppliers of parts to the Group’s man-
ufacturing subsidiaries (see point 2 for the strate-
gic risks of manufacturing in China).
The Group manages these risks through:
a. a permanent evaluation system for the various
suppliers, used for decision-making purposes
and to identify the reliability of each recurrent
supplier in terms of quality and price of the
products supplied;
b. assessment of the risk of fluctuation by the Chi-
nese currency against the US dollar, the Group’s
reference currency which is protected by the
De’Longhi Group
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02 Report on operations 33
Group’s hedging policies;
c. review of the financial status of suppliers and
hence of the allocation of appropriate produc-
tion volumes to each supplier;
d. evaluation of the services provided by suppliers
in terms of logistics and timeliness of deliveries
and of the consequent decisions adopted each
time;
e. a network of reliable and trustworthy key suppliers;
f. inspections, prior to product shipment by sup-
pliers, intended to prevent any defects in the
quality of products acquired.
g. periodic assessment of the buy/make strate-
gies for the Group’s main products taking into
account any global market conditions that
could result in the need to change the strategy.
Lastly, the Group defends its reputation with suppli-
ers in their dealings with employees. Such caution
is duly reflected in contractual dealings and further-
more, every supplier is given a copy of the De’
Longhi Ethical Code governing all its activities.
In 2022 a Group Supplier Code of Conduct, which
describes the ethical, social and environmental
standards that Group suppliers must comply with,
was also finalized and shared with suppliers. The
“Group Responsible Sourcing Guidelines”, which
contain the risk assessment principles to be used
to evaluate and monitor suppliers’ social risk cor-
rectly, were also issued and periodically updated.
Nevertheless, it is conceivable that a breach of con-
tract by one or more suppliers to Group companies
could have adverse effects on the Group’s opera-
tions, economic performance, assets and liabilities
and financial position.
The price of these raw materials and parts can fluc-
tuate significantly, depending on several factors, in-
cluding the cyclical nature of the markets con-
cerned, supply conditions and other factors beyond
the Group’s control and difficult to predict.
The trend in the price of these raw materials and
parts is constantly monitored in order to take nec-
essary action to keep the Group competitive. At the
date of the present report the Group doesn’t hedge
the risk of floating of raw materials prices.
There is also a potential risk stemming from the de-
pendence on one supplier for a few types of parts
used for strategic products: in the face of this risk the
Group has begun looking for secondary suppliers and
defining an alternative purchase/production strategy.
Lastly, the risk stemming from market situations
characterized by anomalies in the supply of raw
materials and parts, as well in the market condi-
tions, is addressed by the Group in a timely manner
in order to preserve margins and supply chain
continuity.
9 - Risks relating to organization and human
resources management: The Group’s success
largely depends on the ability of its executive
directors and other members of management
to effectively manage the Group and the in-
dividual areas of business and on the profes-
sionalism of the human resources that it has
been able to attract and develop.
The principal risks relating to human resources are
linked to the Group’s ability to attract, develop, moti-
vate, retain and empower staff who have the nec-
essary talent, values, and specialist and/or mana-
gerial skills to satisfy the Group’s changing needs.
The loss of such individuals or other key employees
without adequate replacement, or the failure to at-
tract and retain new qualified resources could
therefore adversely affect the Group’s business
prospects, as well as its economic performance
and/or financial position.
In terms of being able to attract quality resources,
the Group’s principal companies plan actions to im-
prove the quality of working environment for its
employees and staff as well as the Group’s external
image (communication, contact with schools and
universities, testimonials, internships, etc.), in some
cases using the services of specialist professional
firms with a proven track record.
In terms of motivating and developing personnel,
actions taken include the strengthening of mana-
gerial, specialist, business and regulative compe-
tencies, with initiatives that involve managers and
staff from different areas of the business.
The salary review process also includes reward
systems for employees at various levels in the
organization - from the plant worker through to
top management and key people - which are
linked to the achievement of short-term and/or
medium/long term targets.
As far as plant personnel is concerned, the Group
De’Longhi Group
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02 Report on operations 34
operates in China and Italy and in Romania. Having
a production facility in Eastern Europe has made it
possible to diversify the Group’s industrial platform,
so as to partly restore the balance in production
between the previously dominant China.
With regards to the Chinese platform, certain risks
exist associated with macroeconomic factors, high
turnover of the manufacturing workforce and the
difficulty in finding production personnel. More in
general, there are many countries in which it is hard
to find personnel with adequate professional skills
when there is a strong recovery in demand; in a few
instances, the gradual aging of the population and
the exit from the workforce as a result of retire-
ment, have increased these difficulties.
These risks are managed through the development
of incentive systems to foster staff retention (pro-
duction bonuses and retention bonuses spread
over time for workers, wage increases linked to
length of service, and incentive schemes for man-
agement), policies for recruiting and managing pro-
duction staff, investment in training and developing
more qualified internal resources, improvements in
living and working conditions within the various
factories (canteens, recreational and leisure activi-
ties, internet access).
As for Romania, where the Group has gradually in-
creased its presence over the last few years, cur-
rently there are two production plants operating in
two distinct areas, also to maximize access to
human resources.
In a business context characterized by complexity
and considerable uncertainty, the need to maintain
flexibility in managing production volumes and,
consequently, the necessary workforce has in-
creased. The lack of adaptability to external factors
could cause slowdowns in production and nega-
tively impact operations, as well as the Group’s eco-
nomic and financial situation.
10 - Risks relating to product quality and
product liability: The Group’s products have
to meet different quality standards according
to the different jurisdictions in which they are
marketed.
The main risk is that products do not meet the qual-
ity standards required by the different regulations
in such jurisdictions. This could justify the return of
such products, with increased costs of production
and an impact on the Group’s image that could
harm its reputation.
The activities of the De’ Longhi Group involve it as-
suming typical producer liability for damage
caused by defective products: part of its sales take
place in jurisdictions (like the USA) where the rules
governing liability for damage caused by products
to people or things are particularly strict.
The Group therefore applies strict standards of
control to its products: it has a protocol for manag-
ing quality risk that involves a series of activities
and procedures in defence of product quality; there
is also a special team that controls quality directly
in manufacturing units and at supplier locations.
In addition, the Group has product liability insur-
ance that is deemed adequate to cover these risks.
Nonetheless, it is conceivable that such insurance
coverage could be inadequate for manufacturing
defects in some of the Group’s products or in other
circumstances. The initiation of significant product
liability claims, or the identification of defects in the
Group’s products, could harm the Group, with ad-
verse consequences for the management and de-
velopment of its business.
11 - Risks relating to inventory levels and de-
livery punctuality: In view of the importance
of inventory and supply chain management
within the Group’s organization, certain risks
can be hypothesized: in fact, the Group is
exposed to a stock level risk, associated with
correctly predicting product quantities and
assortment for subsequent sale.
In the event the Group did not have an adequate
quantity of products available, it could run the risk
of failing to adequately and promptly meet custom-
er demand; if, however, the quantity of products ex-
ceeds orders, the Group might face the risk of
unsold stock or higher than expected stock result-
ing in charges which could affect working capital
and cash flow absorption.
Another risk stems from supply chain manage-
ment inefficiencies which could compromise cus-
tomer service.
The Group currently has a supply chain division and
procedures developed to manage forecasting and
planning are integrated in the IT systems which en-
sures the planning and management of every stage
of the supply chain; recently an important program
was launched which aims to improve the supply
chain procedures. It is in the process of being
implemented.
As for the standard of customer service, the
Group’s procedures require that each customer’s
individual needs are taken into account.
If the Group is unable to predict and/or respond to
issues that could give rise to these risks, there
could be adverse consequences for the Group’s
business, economic performance, assets and liabil-
ities and financial position.
12 - Risks relating to IT systems: The infor-
mation systems of a complex international
group are an important and delicate part of
the company’s processes.
The risks involved include events that could jeop-
ardise the ability to provide continuous service, the
safekeeping of data, obsolescence of telecommu-
nications and data processing technologies.
Cyber-attacks are a threat to any sector and there
has been a general, gradual increase in cy-
ber-crimes. Cyber Risk, namely the risk of financial
losses, interruptions or damages to an organiza-
tion’s reputation, stemming from accidents (for ex-
ample, shutting down servers) or intentional acts
(for example, theft of sensitive data) which damage
the IT system, has, therefore, become increasingly
important.
The Group has taken the steps needed to limit the
above mentioned risks which include the standard
security devices used to protect systems and hard-
ware (from the use of back-up devices to
De’Longhi Group
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02 Report on operations 35
outsourcing with specialized companies). Continu-
ous technological updates are assured by the prev-
alent use of the SAP platform. While the Group has
taken all the steps needed to minimize these risks,
catastrophic events that could compromise the in-
formation systems cannot be excluded.
The Group has launched a multi-year Cyber Risk
Management project in order to analyze any prob-
lem areas and take the actions needed to safe-
guard against this type of risk.
13 - Credit risk: The Group is exposed to credit
risk on its trading activities.
The socio-political (or country) risks discussed ear-
lier (see point 2) could also have an impact on
credit risk; the same applies to the market risks in
relation to the ongoing concentration in the retail
business and to the strengthening of the e-com-
merce channel that may cause the crises of some
retailers (see point 3).
Trade credit risk is monitored using the procedures
developed for the selection and assessment of the
client portfolio, the determination of credit limits,
for tracking payment inflows and any credit collec-
tion activities. Insurance policies with major insur-
ers must be stipulated and, in a few instances, cli-
ents must provide additional guarantees, mainly
bank guarantees.
However, these procedures might not be sufficient
to prevent losses related to the credit risk, that
could affect the Group’s result.
14 - Risks arising from the seasonality of sales:
The De’ Longhi Group’s sells, amongst others,
seasonal products as air conditioners and
portable radiators.
These products, which represent approximately 7%
of the total revenues, are typically seasonal with their
sales concentrated in a limited period of the year.
Seasonality of sales could adversely affect the
Group’s business prospects, as well as its economic
performance and/or financial position.
15 - Risks relating to changes in the regulatory
framework, particularly concerning environ-
mental protection: The Group is subject, in
the various jurisdictions in which it operates,
to the national and international legal re-
quirements and technical standards applica-
ble to the type of products sold.
Particularly important are safety and energy con-
sumption standards for domestic electrical appli-
ances and regulations on consumer contracts, de-
fective products, minimum warranty periods,
recyclability and environmental compatibility.
Although De’ Longhi S.p.A. considers that the
Group’s organization and production comply with
current regulations and that the Group has demon-
strated over time its ability to anticipate regulatory
changes when designing new products, the enact-
ment of additional regulatory requirements applica-
ble to the Group or its products or changes to the
legislation currently in force in the sectors in which
the Group operates, including at an international
level, could require it to adopt stricter standards or
affect its freedom of action or strategic decisions
in various areas of business.
This could result in compliance costs for its pro-
duction facilities or products or even limit the
Group’s operations, with a consequently adverse
effect on its business, economic performance,
assets and liabilities and financial position.
In particular, any changes in environmental regula-
tory standards or requirements currently in force
and the occurrence of unforeseen or exceptional
circumstances, could require the Group to incur un-
anticipated costs. Such costs could therefore have
an adverse impact on the Group’s business, eco-
nomic performance, assets and liabilities and fi-
nancial position.
16 - Risks relating to environmental dam-
age: The industrial production carried out by
the Group with its factories and equipment
could, in certain cases of serious faults or
breakdown in such equipment, cause dam-
age to third parties, accidents or environmen-
tal damage.
Such accidents and damage could also occur in
view of the structural characteristics of certain pro-
duction facilities for which assessments and work
are in progress to make them comply with current
laws and regulations.
Although the Group has taken the necessary safety
precautions and complies with the applicable regu-
lations for preventing these types of risks, if there
was an accident or damage to the environment, the
Group could be held liable, including criminally, by
the people harmed and by the competent authori-
ties, and its production activity could be disrupted,
with consequent adverse effects on the company’s
and/or Group’s economic performance, assets and
liabilities and financial position.
Although Group companies have taken out insur-
ance policies against environmental damage, with
the related coverage considered reasonable in rela-
tion to the estimated risk in question, it is nonethe-
less not possible to exclude the occurrence of
damage, in which the compensation payable ex-
ceeds the maximum coverage provided by such
policies.
17 - Liquidity and financing risks - Interest
rate risk: The liquidity risk possibly faced by
the Group is the risk of not having the funds
needed to fulfil payment obligations arising
from operating and investment activities and
from the maturity of financial instruments.
The Group holds assets and liabilities that are
sensitive to interest rate changes and that are
necessary to manage its liquidity and finan-
cial needs.
It is the Group’s policy to maintain a sufficiently
large portfolio of counterparties of international
repute for the purposes of satisfying its financing
and hedging needs.
The Group uses specific policies and procedures for
the purposes of monitoring and managing this risk,
including the centralized cash management (financial
debt and cash management, the raising of medium
De’Longhi Group
|
02 Report on operations 36
term loans from fluctuations in the interest rates
and has also created a natural hedge by matching
the duration of financial investments with that of fi-
nancial liabilities.
18 - Compliance and corporate reporting risks:
A. Financial reporting: Risks associated with the re-
liability of financial reporting, particularly that the
information contained in the annual and interim fi-
nancial reports might not be correct, warrant par-
ticular attention, especially for a listed company.
In 2023, the effective application of the risk man-
agement system for financial reporting was moni-
tored continuously, as well as assessed periodical-
ly, under the guidance of the functions in charge.
For the purposes of ensuring reliable internal finan-
cial reporting controls, the Group implemented a
system of administrative and accounting proce-
dures which include the accounting policy instruc-
tions, principles and updates, as well as other pro-
cedures for preparing the consolidated financial
statements and the periodic financial reports.
The Group’s Corporate functions are responsible
tion of collection flows.
In 2023 there was a sudden change in monetary
policies which resulted in a significant increase in
interest rates.
The management of this risk is centralized and
done using the same structure used to manage for-
eign exchange risk. Nevertheless, sudden fluctua-
tions in interest rates could have an adverse impact
on the Group’s business prospects, as well on its
economic results and/or financial position.
At the date of this report, the Group has one hedg-
ing agreement which protects the medium/long
and long-term finance on capital markets and the ob-
taining of short-term credit lines that allow wide room
for manoeuvre when managing working capital and
cash flows). In relation to the interest rate risk, the
Group as of 31 December 2023 has a positive net fi-
nancial position and is exposed, mainly on the
medium/long term, in order to benefit from the finan-
cial market trends. The Group also has short-term
bank credit lines (typically with annual renewal), to
cover any financing or other operational needs.
Lastly, a revolving agreement for factoring without
recourse is also in place which allows for optimiza-
De’Longhi Group
|
02 Report on operations 37
for ensuring that other Group companies are aware
of and adhere to these procedures.
The control bodies (internal and external) carry out
the related audits to the extent of their
responsibilities.
Any failure to maintain adequate processes, as well
as adequate administrative-accounting and man-
agement controls, may result in erroneous financial
reporting.
In addition to financial reports, the Group also pre-
pares a Non-Financial Statement based on the GRI-
2021 principles and each year instructs the branch-
es and the competent functions as to which
non-financial indicators should be reported on.
B. Risks relating to the administrative liability of
legal: In compliance with EU directives, Decree
231/2001 has introduced into Italian law special
rules applying to the liability of entities for certain
offences, where “entities” mean limited liability
business enterprises, partnerships or associa-
tions, including those without legal status.
Under this legislation and amendments and addi-
tions thereto, the Group’s main Italian companies
have adopted, in accordance with art. 6 of Decree
231/2001, the “Model of organization, manage-
ment and control” suitable for avoiding the occur-
rence of such liability at their own expense and the
related “Ethical code”, intended to apply not only to
the Group’s Italian companies but also, as far as
applicable, to its foreign subsidiaries, since De’
Longhi S.p.A. is also answerable, under art. 4 of
Decree 231/2001, for offences committed abroad.
Therefore, the company’s administrative liability
under Decree 231/2001 could exist when this is ef-
fectively established as a result of an action
brought against one of the Group companies,
including the foreign subsidiaries; in such a case, it
is not possible to exclude, in addition to the result-
ing application of penalties, adverse consequences
for the company’s and/or Group’s operations, eco-
nomic performance, assets and liabilities and fi-
nancial position.
19 - Related parties: The Group has had and
continues to have transactions of a commer-
cial nature with related parties. Such trans-
actions carry conditions that are in line with
market ones.
The Company adopted a new set of procedures to
govern the Group’s transactions with related par-
ties, in compliance with the standards set by the
supervisory authorities in CONSOB Regulation
17221 dated 12 March 2010.
The procedures identify those related party trans-
actions subject to specific examination and ap-
proval rules, which change according to whether
such transactions are above or below defined
thresholds. The procedures place particular impor-
tance on the role of the independent directors, who
must always issue a prior opinion on the proposed
transaction (if the transaction qualifies as material,
this opinion is binding on the Board of Directors);
the independent directors must also be involved in
the preliminary examination of material transac-
tions prior to their approval.
These procedures are considered to represent an
additional guarantee of the transparency of the De’
Longhi Group’s operations.
De’Longhi Group
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02 Report on operations 38
Annual
remuneration report
Reconciliation of net equity
and profit (loss) for the year
Please refer to the Annual Remuneration Report for all relevant information not contained in the present
report.
Below is a concise reconciliation between net
equity and profit of the parent company, De’ Longhi
S.p.A., and the figures shown in the consolidated fi-
nancial statements:
Net equity
31.12.2023
Profit for 2023
Net equity
31.12.2022
Profit for 2022
De' Longhi S.p.A. financial statements 557,569 36,578 588,531 100,808
Share of subsidiaries' equity and results for period attributable to the Group,
after deducting carrying value of the investments
834,186 218,905 649,687 59,442
Allocation of goodwill arising on consolidation and related amortization and
reversal of goodwill recognized for statutory purposes
464,525 (444) 465,679 5,308
Elimination of intercompany profits (45,425) (4,613) (40,820) 14,286
Other adjustments 284 (14) 314 (1)
Consolidated financial statements 1,811,139 250,412 1,663,391 179,843
Minority - 35 4,274 2,415
Consolidated financial statements-Group portion 1,811,139 250,377 1,659,117 177,428
De’Longhi Group
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02 Report on operations 39
Treasury shares
At 31 December 2023 the Group, through the
parent company De’ Longhi S.p.A., held 595,000
treasury shares for a total of €9,658 thousand, pur-
chased in previous years. The change versus the
value as at 31 December 2022 (De’ Longhi S.p.A.,
held 895,350 treasury shares for a total of €14,534
thousand) is due to the exercise of n.300,350 op-
tions within the “2020-2027 Stock Option Plan”.
During the Shareholders’ Meeting held on 21 April
2023, shareholders approved the renewal - after re-
voking the previous authorization granted by share-
holders - of the authorization to purchase and sell
treasury shares for up to a maximum of 14.5 mil-
lion ordinary shares or for an amount which does
not exceed one fifth of the share capital, including
any shares held by the Company or any of its
subsidiaries.
The buyback program was approved, in accord-
ance with the law, for a period of up to a maximum
of 18 months (namely through 21 October 2024).
De’Longhi Group
|
02 Report on operations 40
Tax consolidation
Related party transactions
The Parent Company De’ Longhi S.p.A. and a few of the Italian subsidiaries exercised, jointly with the consol-
idator De Longhi Industrial S.A., the option to adhere to group taxation, referred to as “Domestic Tax Consol-
idation”, as permitted under articles 117 - 129 of the Consolidated Income Tax Act (TUIR) as per Presidential
Decree n. 917 of 22 December 1986, and the Decree of the Ministry of Economy and Finance of 1 March
2018, for the three-year period 2022-2024.
Related party transactions fall within the normal course of business by Group companies.
Information on related party transactions is summarized in Appendix 3 to the Explanatory notes.
De’Longhi Group
|
02 Report on operations 41
Alternative
performance indicators
In addition to the information required by IFRS, this
document presents other financial measures
which provide further analysis of the Group’s per-
formance. These indicators must not be treated as
alternatives to those required by IFRS.
More in detail, the non-GAAP measures used
include:
• Net industrial margin and EBITDA: the Group
uses these measures as financial targets in in-
ternal presentations (business plans) and in ex-
ternal presentations (to analysts and investors),
since they are a useful way of measuring operat-
ing performance by the Group and its individual
divisions besides EBIT.
Net industrial margin is calculated as total reve-
nues minus the cost of materials consumed and of
production-related services and payroll.
EBITDA is an intermediate measure that derives
from EBIT after adding back depreciation, amorti-
zation and impairment of property, plant and equip-
ment and intangible assets. EBITDA is also pre-
sented net of non-recurring items, which are
reported separately on the face of the income
statement.
• Net working capital: this measure is the sum of
inventories, trade receivables, current tax assets
and other receivables, minus trade payables, tax
liabilities and other payables.
• Net operating working capital: this measure is
the sum of inventories and trade receivables,
minus trade payables.
• Net capital employed: this measure is the sum of
net working capital, intangible assets, property,
plant and equipment, equity investments, other
non-current receivables, and deferred tax assets,
minus deferred tax liabilities, employee sever-
ance indemnity and provisions for contingencies
and other charges.
• Net financial position: this measure represents
financial liabilities less cash and cash equiva-
lents and other financial receivables; the position
with banks, net of non-banking items, is also re-
ported. The individual line items in the statement
of financial position used to determine this
measure are analysed later in this report.
The figures contained in this report, including some
of the percentages, have been rounded relative to
their full euro amount. As a result, some of the
totals in the tables may differ from the sum of the
individual amounts presented.
De’Longhi Group
|
02 Report on operations 42
Consolidated
Non-Financial Statement
2023
Introduction
This consolidated Non-Financial Statement (NFS) of
the De’ Longhi Group was prepared in accordance
with Articles 3 and 4 of Legislative Decree n.254/2016,
which is the Italian law implementing the provisions
of the “Barnier Directive” (Directive 2014/95/EU)
based on which large public entities are required to
publish a Non-Financial Statement (NFS).
In fulfilling these obligations above, De’ Longhi’s
NFS 2023 identifies and describes a group of
topics which are deemed material for both the
Group and its stakeholders. The information rela-
tive to these topics is included in this report which
aims to describe the risks, policies, practices, ob-
jectives, the organizational structure, along with the
main performance indicators relating to environ-
mental and social topics, as well as human re-
sources, respect for human rights and the fight
against corruption and fraud. This reporting
method guarantees the company’s transparency
with respect to its stakeholders and the most rele-
vant non-financial topics. Furthermore, Budget
Law n.145/2018, which took effect as of 31 De-
cember 2018, introduced paragraph 1073 which
amended Legislative Decree 254/2016 and in addi-
tion to disclosing the main risks, entities are also
required to describe how the risks are managed.
This report, which has reached its seventh edition,
refers to the reporting period 1 January 2023
through 31 December 2023; at the same time, the
report provides the reader with a comparison of the
results reported in 2021 and 2022. The process in-
volved in identifying important impacts and the rela-
tive material topics, introduced in the 2021 GRI
Standards, is described in the Note on Methodology.
This report also incorporates the recommenda-
tions which are provided each year by the European
Securities and Markets Authority (ESMA), which for
this year were published on 25 October 2023. The
recommendations included for non-financial re-
porting focus on three main areas: European taxon-
omy; the targets, actions and progress made rela-
tive to climate change; and information relating to
Scope 3 emissions.
With regard to the European Taxonomy, reference
should be made to the chapter European Taxonomy
which includes the details of the qualitative and
quantitative information related to the three KPI and
the environmental targets referred to in the Taxono-
my. The “Mitigation of environmental impact” chap-
ter provides details of the Group’s performance rela-
tive to climate change: the report examines the
actions taken and the progress made in this regard.
Without making any disclosures, the Company does
monitor the Scope 3 emissions along the value
chain: the possibility of expanding the information
provided to include climate change and indirect
emissions, consistent with the new reporting direc-
tive, in future reporting periods is being assessed.
On 5 January 2023 the new “Corporate Sustainabili-
ty Reporting Directive” (CSRD) took effect which
substitutes the “Non-Financial Reporting Directive”
(NFRD) implemented in Italy by Legislative Decree
in 254/2016 which requires all listed companies, as
of the 2024 reporting period, to prepare a renewed
sustainability statement. Based on the most rele-
vant changes, the report must be based on the con-
cept of “double materiality” which calls for the iden-
tification of environmental and social impacts is
generated along the value chain, as well as the
Group’s risks and opportunities. This new regulato-
ry framework will make it necessary to adopt the
new reporting standards, the “European Sustaina-
bility Reporting Standards” (ESRS), instead of the
GRI Standards. In 2023, De’ Longhi began working
on compliance with the Directive’s new requirement
in preparation for the next reporting year.
Description of the Business Model
A brief description of the De’ Longhi Group’s busi-
ness model is included below in order to provide a
general overview which will help the reader to
better understand the information provided in the
report and the material topics identified under Leg-
islative Decree n.254/2016.
De’ Longhi S.p.A. (hereinafter also referred to as the
De’Longhi Group
|
02 Report on operations 43
“Company” or “Group”), was born in 1974 and listed
in 2001 on the Borsa Italiana’s Euronext market.
The Company is one of the world’s leading players
in small domestic appliances associated with the
world of coffee, the kitchen, air conditioning, as well
as home care, and distributes its products in more
than 120 markets worldwide. Lastly, it is the hold-
ing of a portfolio of companies which control seven
brands: De’ Longhi, Kenwood, Braun, Ariete, Ever-
sys, Nutribullet, Magic Bullet (the last two belong to
the American group Capital Brands).
De’ Longhi’s sustainability path
The De’ Longhi Group has built its sustainability
path over the years with a view to understanding
and analyzing its economic, social and environ-
mental role in an increasingly in-depth manner, gen-
erating more value for the company and its stake-
holders. This objective is pursued through the
implementation of concrete actions, like the adop-
tion of a sustainability strategy which aims to miti-
gate any impacts generated and improve the sus-
tainability performances, which guarantee
transparent, reliable and continuous
communication.
2023 was a year of stabilization for the Group in the
wake of the changes made in prior years during
which the composition and management of its
sustainability governance changed. Currently the
corporate bodies and individuals charged with pur-
suing the sustainability goals continue to be:
1. the Control, Risk, Corporate Governance and
Sustainability Committee, already operational
in 2019, is a Board committee which provides
preliminary, proactive guidance, as well as advi-
sory, functions in relation to sustainability;
2. the Sustainability Steering Committee, formed
in 2019, comprised of top management and dif-
ferent department managers, endorses and
supports the Group’s sustainability strategy;
3. Group Sustainability Director.
2023 marked another and important milestone in
the De’ Longhi Group’s sustainable path. During the
reporting year the Company worked on updating the
prior Sustainability Plan (approved by the Board of
Directors in July 2022). This updated Sustainability
Plan was included in the Medium Term Plan 2024-
2026 (approved by the Board of Directors during the
meeting held on 18 January 2024), thus continuing
to be one of the key enablers.
The Value Chain
Design, quality, and functionality are the elements
which characterize the De’ Longhi Group’s brands and
that have led the Group be recognized worldwide as
leaders in the coffee, food preparation, and comfort
segments. The Company is committed to guarantee-
ing high standards for its consumers, applying an op-
erational approach which begins with Group-wide re-
search, development and design. Marketing, Design
and product line technicians work together with these
divisions. More in detail, R&D takes a transversal ap-
proach, focusing on the business units rather than the
single brands in order to guarantee consistency in the
application of knowhow across the Group. In the
Hong Kong branch, there is also a technical office re-
sponsible for research projects developed in partner-
ship with local providers.
The Group’s operational approach is based on the
concept “local for global” which translates into the
creation of specialized hubs across the different
product lines located inside the six production facil-
ities found in Italy, Switzerland, Romania and China
1
, which focus on specific market segments and
supply about 60% of the products sold.
In order to purchase raw materials and semi-fin-
ished goods, the Group establishes and maintains
relations with qualified partners, selected based on
the quality standards defined in its purchasing poli-
cies or “Original Equipment Manufacturers” (herein-
after also referred to as “OEM”).
The production phase is followed by product test-
ing during which the Group guarantees that the
highest standards for product safety have been ap-
plied to every product going to market. This pro-
cess is managed by specialized technical teams
that are part of the Quality division; the latter,
through internal audits, carries out specific quality
controls of the products and their suppliers. More
in detail, the Company uses a vendor rating to audit
suppliers which focuses on parameters identified
for this purpose. These aspects will be examined
further in the chapter “Supply Chain Management”.
Once certified as ready for sale, the product is
transferred to specific warehouses, located world-
wide, which also act as strategic logistic hubs.
These centers are owned by the Group and facili-
tate the organization of logistics and delivery of
products to all the markets served and to all the
stakeholders involved in De’ Longhi’s distribution
network.
1 In 2023, work began on opening a new Group plant in Satu
Mare, Romania. While it is a pre-existing asset, currently no
production is carried out there and, therefore, it was not in-
cluded in the reporting perimeter, but will become relevant
as of 2024.
De’Longhi Group
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02 Report on operations 44
Lastly, the Company is committed to guaranteeing
the best service during and after the sale, providing
technical assistance to everyone who purchases a
Group product. This activity is carried out by a Cus-
tomer Care team which, in the past few years, has
taken steps to improve and has adopted new tech-
nologies to respond to market needs.
The Group’s Stakeholders
The De’ Longhi Group recognizes that the success
of a company is based also on its ability to gener-
ate value for itself and all its stakeholders. The
Group interacts with the latter in accordance with
its Code of Ethics, guaranteeing active listening
and an exchange of information based on princi-
ples of fairness, completeness and transparency.
In order to standardize its decision-making pro-
cesses and embrace changes in the market more
effectively, De’ Longhi is committed to listening and
understanding the needs of its stakeholders, antici-
pating their expectations. Toward this end, the
Group continues to manage and maintain relations
with its stakeholders through more effective com-
munication channels and actively involving compa-
ny management. These mechanisms are the prod-
uct of an analysis which took into account the
aspects which are relevant to the company’s struc-
ture, the value chain, the business and other activi-
ties, but which characterize and are an integral part
of the company’s mission. The ten categories of
stakeholders identified, broken down based on the
relation with the Group and the relative types of in-
terests, expectation and needs are reported:
Stakeholders Communication/listening channel Main topics that emerged
Trade associations Annual meetings, periodic meetings Consumer rights, workers’ rights, environmental performance
Shareholders Corporate documents /Shareholders’ meetings/ Events Economic performance, business strategies
Communities and ONG Periodic meetings, sponsorships of specific initiatives
Sponsorships, social impact, contribution to the community,
raising awareness of specific problems
Consumers
Satisfaction questionnaires, panel test, Contact Centers (voice
channels, e-mail, chat and social), advertising campaigns,
cultural events, Youtube “How to” channel
Customer assistance, product safety and quality, product
availability, feedback about ease of use and product satisfac-
tion, privacy
Employees
Employee Engagement Survey, annual performance reviews,
periodic meetings to share results, corporate intranet used to
access Group information, Group house organ, new HRMS
Organizational clarity, improved management of resources by
managers, appreciation of individual contributions to the
company, improvement in internal communications and
access to information
Suppliers Contracts, qualifications, assessments and periodic meetings Way in which supplier relationships are managed
Future generations - Reduce emissions and fight climate change
Financial analysts, media Interviews, meetings, road shows, press conferences
Economic performance, new products/ services/organization-
al models, specific social initiatives
Commercial partners Sales meetings, audit
Product safety and quality, flexibility and adaptability to
requests
Universities/research
institutions
Dedicated meetings, partnerships on different research
projects
Recruiting and talent acquisition, recruiting support
De’Longhi Group
|
02 Report on operations 45
The European
Taxonomy
significant harm (Do No Significant Harm –
DNSH) to any of the above environmental
targets;
– is carried out in way which guarantees the
minimum safeguards, namely the controls
implemented by the Group to guarantee re-
spect for human rights and international laws
governing labor organization along the supply
chain.
Since it took effect in 2020, the Regulation has
been amended on several occasions which have
gradually introduced new sectors and activities.
In 2021, the European Commission approved the
Climate Delegated Act
3
, which governs the first two
climate targets: climate change mitigation and cli-
mate change adaptation. The Climate Delegated
Act has already been amended twice. Firstly, the
Complementary Delegated Act
4
included the gas
and nuclear sectors. Subsequently, with the publi-
cation of Delegated Regulation (EU) 2023/2485 in
2023, other changes were made to the Climate Del-
egated Act, in terms of both new economic activi-
ties and technical screening criteria.
The last change to the perimeter of the Regulation
was enacted in the Environmental Delegated Act
5
,
approved in June 2023, which lists the activities
which contribute to the environmental activities
outside the scope of the climate: sustainable use
and protection of water and marine resources; tran-
sition to a circular economy; pollution prevention
and control; and protection and restoration of biodi-
versity and ecosystems.
2024 marks the third year of Regulation
The European Union Taxonomy, introduced with EU
Regulation 2020/852 (hereinafter the “Regulation”),
adopted by the European Commission on 12 July
2020, is part of an EU strategy for achieving the Eu-
ropean Green Deal targets and making Europe cli-
mate neutral by 2050. The EU taxonomy, which is
applicable to all companies who are required to pre-
pare a Non-Financial Statement pursuant to Direc-
tive 2014/95/EU provides a single classification
system based on which it is possible to define the
economic activities that meet certain eco-sustain-
ability criteria.
More in detail, based on the Regulation economic
activities are broken down as follows:
• Eligible: an activity is eligible
2
if it is listed as one
of the acts recognized in the Regulation as part of
one or more of the six Taxonomy’s environmental
targets. More specifically: climate change mitiga-
tion and adaptation, the sustainable use and pro-
tection of water and marine resources, the transi-
tion to a circular economy, pollution prevention
and control, the protection and restoration of bio-
diversity and ecosystems. If eligible, the activity
has the potential to make a substantive contribu-
tion to the relative target;
• Aligned an economic activity is aligned if, in ad-
dition to being eligible:
– is carried out in accordance with the technical
criteria defined by the European Commission.
More in detail, the economic activity must
make a substantial contribution to one or
more of the environmental objectives de-
fined in Article 9 of the Regulation and do no
application: consistent with the prior year, in 2023
the companies subject to an obligation to publish a
Non-Financial Statement, like the De’ Longhi Group,
shall include in this statement the proportion of
Turnover, CapEx and OpEx pertaining to the eligible
and non-eligible activities referred to in the first two
environmental targets relating to Climate Change.
For the first year of application, the Environmental
Delegated Act requires that non-financial compa-
nies disclose solely the eligible portion of the three
KPIs mentioned above.
The assessment of the Group’s compliance with
the Regulation and the statement with the required
quantitative KPI are provided in the following
paragraphs.
As this regulation is updated constantly, all the cri-
teria and assumptions used are based on informa-
tion and requirements available to date, which
could be revised in the future.
The Analyses Conducted
In light of the changes referred to above which
relate primarily to the publication of the Environ-
mental Delegated Act, the De’ Longhi Group updat-
ed the analysis of its revenue-generating activities
in order to identify, based on the UE Taxonomy,
which could be classified as eligible or potentially
capable of contributing substantially to the six envi-
ronmental targets. Based on this analysis, the eco-
nomic activity “1.2 -Manufacture of electrical and
electronic equipment” of the “Transition to a circu-
lar economy” target was viewed as consistent with
2 Eligible economic activity under the Taxonomy: an eco-
nomic activity described in the delegated acts adopted
pursuant to Article 10, paragraph 3, Article 11, paragraph 3,
Article 12, paragraph 2, Article 13, paragraph 2, Article 14,
paragraph 2, and Article 15, paragraph 2, of EU Regulation
2020/852, independent of the fact that this economic ac-
tivity satisfies one or all of the technical criteria established
in the delegated acts.
3 Delegated Act (EU) 2021/2139
4 Delegated Act (EU) 2022/1214
5 Delegated Act (EU) 2023/2486, adopted on 27 June 2023
and effective as from 1 January 2024.
De’Longhi Group
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02 Report on operations 46
its core business. The description of this activity
also makes specific reference to the code NACE
(Nomenclature statistique des activités économi-
ques dans la Communeauté européenne) “C27:
Manufacture of electronic equipment”, which coin-
cides with the De’ Longhi Group’s NACE code.
Furthermore, based on Annex 1 of the Delegated
Act (EU) 2021/2178, paragraphs 1.1.2.2 (c) and
1.1.3.2 (c)
6
relating to investments and the pur-
chase of output from eligible economic activities
and individual measures which make it possible for
the activities to maintain low levels of carbon emis-
sions, the Group identified the economic activity
“6.5 - Transport by motorbikes, passenger cars
and light commercial vehicles” as an eligible activ-
ity tied to the “Climate Change Mitigation” target.
The steps taken to assess the alignment of these
activities are described below.
As reported above, for the reporting year 2023 the
alignment analysis refers solely to the activities
listed in the Climate Delegated Act and relative to
the climate target. The analysis of the alignment of
the activities included in the Environmental Dele-
gated Act will be carried out as of the next reporting
year.
Activity 6.5 - Transport by motorbikes, passen-
ger cars and light commercial vehicles – align-
ment assessment
With regard to the investments made by the Group
in the reporting year 2023, the analysis looked at
“6.5 Transport by motorbikes, passenger cars and
light commercial vehicles” of the Climate Delegat-
ed Act:
• Criteria: substantial contribution to the mitiga-
tion of climate change: the assessment aimed
to establish whether or not the single economic
activity identified contributes substantially to
reaching the climate change mitigation goals
based on specific quantitative and/or qualitative
parameters defined in a) and b) defined in the
Regulation;
• Do Not Significant Harm (DNSH): in order to the
aligned with DNSH, the regulation requires com-
pliance with the following criteria:
– Climate change adaptation: based on the criteria
listed in Annex A, the organization must identify
and assess the physical climate change risks
that impact the activity using a specific proce-
dure defined in the Delegated Act;
– Transition toward a circular economy: based
on the criteria outlined at least 85% of the
weight of the vehicles must be reusable or re-
cyclable and measures must be in place for
the management of waste during mainte-
nance and at the end of the fleet’s life cycle;
– Pollution prevention and control: the criteria
outlined require that the vehicles:
– comply with the requirements in the most
recent Euro 6 standards for the emissions
of light vehicles established pursuant to
regulation (EC) n. 715/2007;
– respect the emission thresholds for light
vehicles referred to in Table 2 of the annex
to Directive 2009/33/EC
7
of the European
Parliament and the Council;
– are equipped with tires which comply with
6 Related to the purchase of output from Taxonomy-aligned
economic activities and individual measures enabling the
target activities to become low-carbon or to lead to green-
house gas reductions, notably activities listed in points 7.3
to 7.6 of Annex I to the Climate Delegated Act, as well as
other economic activities listed in the delegated acts
adopted pursuant to Article 10(3), Article 11(3), Article
12(2), Article 13(2), Article 14(2) and Article 15(2) of Regu-
lation (EU) 2020/852 and provided that such measures are
implemented and operational within 18 months.
7 Directive 2009/33/EC of the European Parliament and
Council of 23 April 2009, relating to the promotion of clean
and energy-efficient road transport vehicles.
8 Regulation (EU) 540/2014 of the European Parliament and
Council of 16 April 2014, on the sound level of motor vehi-
cles and of replacement silencing system.
the requirements for rolling noise of the
highest tire class and the rolling resistance
coefficient in the two highest classes as es-
tablished in Regulation (EU) 2020/740 (for
M and N class motor vehicles);
– comply with Regulation (EU) 540/2014
8
of
the European Parliament and the Council;
• Guarantees of the minimum safeguards: the
criteria detailed in the Regulation refer to the or-
ganization’s practices to ensure compliance with
the OECD guidelines for international compa-
nies and the United Nations principles relative to
companies and human rights, including the prin-
ciples and rights established in the eight basis
conventions identified in the ILO Declaration on
Fundamental Principles and Rights at Work and
the Universal Declaration of Human Rights.
The analysis made showed that a portion of the in-
vestments made by the Group is aligned with the
substantial contribution criteria listed in the Cli-
mate Delegated Act, as part of the motor vehicles,
classified as M1 (Vehicles used to transport people,
with 8 seats in addition to the driver’s seat) and N1
(Vehicles used to transport merchandise, of not
more than 3.5t), have emissions of less than 50
gCO
2
/km.
The specificity of the available data, however, is not
sufficient to allow for a complete assessment as to
the compliance with the criteria outlined above for
DNSH. Based on a conservative and prudential ap-
proach, the Group finds that that activity is not
aligned with the DNSH criteria for the reporting
year 2023.
With regard to the guarantees of the minimum
De’Longhi Group
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02 Report on operations 47
safeguards, the De’ Longhi Group pays great attention
to topics relating to consumer protection, corruption,
competition, tax issues and respect of human rights.
With regard to the latter, the Group is committed to
guaranteeing ethical business practices which comply
with the applicable regulations in all the countries in
which it operates, carrying out its activities in accord-
ance with the principles of the Group’s Code of Ethics
which, as of 2022, is applicable also to all its suppliers.
In addition to this document, the Group also published
“Responsible Sourcing Guidelines” which define the
criteria to be used when assessing and monitoring
new supplier risks over time. The De’ Longhi Group also
audits its suppliers of finished products periodically in
order to assess different social aspects, like the free-
dom of association and collective bargaining, hours
and work conditions, health and safety, child or forced
labor, discrimination and training of personnel. For fur-
ther information refer to the chapters “Ethics and Com-
pliance” and “Supply Chain Management”.
The Group pays particular attention to gender
equality, attested to by the launch of specific initia-
tives relating to DE&I (Diversity Equity and Inclu-
sion). Further information on ongoing initiatives
and indications relative to the workforce (refer to
the “Breakdown of the workforce” and “Composi-
tion of the Parent Company’s BoD” tables) can be
found in the section “Policies and objectives” of the
“Human Resources Management” chapter.
With regard to protection of consumers, competi-
tion, anti-corruption and tax, the Group works con-
stantly to prevent and mitigate any potentially neg-
ative impact. The Group’s Code of Ethics has a key
role in this regard, as great attention is paid to con-
sumers and customers, to fair competition, the
condemnation of corruption and compliance with
the law, regulations and provisions of the
competent tax authorities. For further information
refer to the chapter “Ethics and Compliance”.
Despite what is described above and in light of the
fact that, with regard to the investments made in
the activity analyzed which must take into account
the practices and procedures of the supplier, based
on a conservative and prudent approach, the Group
concluded that the current practices are not suffi-
cient to consider the activity aligned with the mini-
mum safeguards criteria.
Contextual information relative to the
KPI calculation
The assumptions and methodologies used to cal-
culate the KPI for the activities deemed eligible and
possibly aligned, as defined in the Annexes of the
Disclosure Delegated Act
9
, are provided below. The
methods of calculation, the composition in relation
to the different activities provided for in the EU Tax-
onomy and the quantification process are provided
for each of the KPI. In accordance with the Regula-
tion the revenue generated and the costs incurred
for intercompany transactions are not taken into
account.
Group administrative and accounting divisions, rel-
ative to both headquarters and the individual pro-
duction plants, were involved in the KPI calcula-
tions. Based on the indications found in Annex 1 of
the Disclosure Delegated Act, they identified the
accounting items to be associated with the differ-
ent KPI (numerator and denominator), beginning
with the items found in the consolidated financial
statements.
Furthermore, to date no investment plans for
CapEx and OpEx which satisfy the requirements
set out in paragraph 1.1.2.2 have been drafted. For
this reason, the two KPI do not include any plans
for expanding the Taxonomy-aligned economic ac-
tivities or allowing eligible economic activities to
become aligned with the Taxonomy.
Please note that as there are currently no eligible
activities under the Complementary Delegated Act,
the relative tables are not included in this report.
Turnover
The calculation of the denominator was based on
the net sales figure reported in the De’ Longhi’s
Annual Report for 2023 which amounted to
€3,043,086 thousands. The items used specifically
to determine the denominator include the revenue
from the sale of goods and services, net of dis-
counts, VAT or any other direct tax, which reflects
the revenue generated by the Group’s core busi-
ness: more specifically, the item included refers to
“Revenues from client contracts”.
The numerator was calculated based net of the
total revenues included in the denominator ob-
tained from the sale of IT services to third parties
and the sale of accessories net of discounts, re-
bates, VAT and additional taxes. The eligible turno-
ver generated by the Group is associated with Ac-
tivity 1.2 – Manufacture of electrical and electronic
equipment.
CapEx
The denominator was determined based on the in-
creases in value of tangible, intangible and right of
use of assets (as per IFRS 16) recorded during
2023 which amounted to €136,338 thousands.
9 Delegated Regulation (EU) 2021/2178
De’Longhi Group
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02 Report on operations 48
The numerator was based on the asset additions
reported during the year: investments relative to (a)
10
and (c)
11
as defined in item 1.1.2.2 of Annex I of
the Disclosure Delegated Act were identified. More
in detail, for Activity 1.2 Manufacture of electrical
and electronic equipment – summary of the
Group’s core business– these include investments
in plant, property and equipment, intangible assets
or right of use assets of the production companies
deemed essential to the business activities, which
were, therefore, allocated entirely to the numerator,
with the exception of the portion of fixed assets
classified under (c) of the Regulation.
With reference to (c), the Group identified invest-
ments in IFRS 16 “right of use” assets for Activity
6.5 Transport by motorbikes, passenger cars and
light commercial vehicles. This activity reflects the
investments made in property, plant and equip-
ment (leasing of motor vehicles), the calculation of
which was made using the data provided by the
single legal entity included in the scope of
consolidation.
In light of the allocation of these items to (c), in
order to avoid double counting, the items registered
as “Right of use” for this activity was excluded from
the calculation of the numerator for (a) which refers
to Activity 1.2 Manufacture of electrical and elec-
tronic equipment.
OpEx
The denominator was calculated based on the con-
solidated operating figures which amounted to
€90,564 thousands for the categories referred to in
the regulations including R&D which was not capi-
talized, short-term maintenance and leasing, rec-
ognized in the income statement.
The OpEx numerator was determined using a
method consistent with the one used for the CapEx
KPI. More in detail, R&D and Leasing were
considered instrumental to the core business activ-
ities, as they refer to product development and the
logistics spaces used by the Group companies for
distribution. The portion of these categories was
allocated entirely to the numerator beginning with
the Group’s consolidated figures.
Accounting Policy for the KPI
The Group, after having identified its eligible activi-
ties and assessed any consistency with the align-
ment criteria, calculated the three KPI.
The following paragraphs provide the details of the
accounting items used to calculate the KPI called
for in the Annexes to the Disclosure Delegated Act.
Turnover
The Turnover KPI was calculated as the portion of
the net sales deriving from the services associated
with activities identified as eligible (numerator) di-
vided by net sales (denominator). Net sales is de-
fined as the amount generated by the rendering of
services net discounts and any value added tax di-
rectly associated with the turnover. With a view to
avoiding any double counting, the intercompany
transactions were not included in the KPI calcula-
tion. Consequently, the KPI denominator corre-
sponds to “Revenues from customer contracts”
found in Note 1 of the Group’s consolidated finan-
cial statements – and is in line with the provisions
of IAS 1, par.82(a), mentioned in item 1.1.1. of
Annex I of the Disclosure Delegated Act.
CapEx
The denominator of the CapEx KPI was calculated
based on the asset additions made in the reporting
period to tangible assets (investments in plant,
property and equipment) and intangible assets
(investments in intangible assets) and right-of-use
assets (investments in leased assets).
The approach used to extract the data was based
on an analysis of the consolidated reports. In ac-
cordance with the international accounting stand-
ards and the provisions of Annex 1 of the Disclo-
sure Delegated Act, IAS 16 was used to calculate
the tangible assets, IAS 38 for the intangible assets
– excluding goodwill and IFRS 16 for the right-of-
use assets - as was the case in the consolidated
annual report.
OpEx
The denominator of the OpEx KPI was calculated
based on the Group’s consolidated operating re-
sults and the costs associated specifically with
categories referred to in Annex I of the Disclosure
Delegated Act:
• the technical costs, which include the R&D ex-
penses stemming from internal and external
projects which were not capitalized;
• rental and leasing costs, which include all the
leasing items recognized in the income state-
ment, exempt from IFRS 16 application;
• third party maintenance which includes routine
maintenance of assets and building
renovations.
10 Capital expenditure included in the denominator relative to
assets or processes associated with economic activities
included in the taxonomy.
11 Capital expenditure relating to the purchase of products
derived from economic activities aligned with the taxono-
my and the single measures which consent the target ac-
tivity to lower carbon emissions or reduce greenhouse
gases.
De’Longhi Group
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02 Report on operations 49
FY 2023 Year Criteria for the sustainable contribution Criteria for “does no significant harm“
Economic activity (1)
Code/s (2)
Turnover (3)
Portion of expenses
invoiced 2023 (4)
Climate change
mitigation of (5)
Climate change
adaptation (6)
W
ater and marine
resources (7)
Circular economy (8)
Pollution (9)
Biodiversity and
ecosystems (10)
Climate change
mitigation (11)
Climate
change adaptation
(12)
Water and marine
resources (13)
Circular economy (14)
Pollution (15)
Biodiversity and
ecosystems (16)
Guarantees minimum
safeguards (17)
Portion of turnover aligned
(A.1.) or eligible (A.2.)
under the taxonomy, 2022
(18)
Category (enabling)
(19)
Cate
gory (transitional)
(20)
k € % Yes;No;N/AM Yes;No;N/AM Yes;No;N/AM Yes;No;N/AM Yes;No;N/AM Yes;No;N/AM Yes/No Yes/No Yes/No Yes/No Yes/No Yes/No Yes/No % A T
A. TAXONOMY ELIGIBLE ACTIVITIES
A.1 Eco-sustainable activities (taxonomy aligned)
Turnover from eco-sustainable
activities (taxonomy aligned) (A.1)
- 0% 0% 0% 0% 0% 0% 0% No No No No No No No 0,00%
of which enabling 0% 0% 0% 0% 0% 0% 0% No No No No No No No 0% A
of which transitional 0% 0% No No No No No No No 0% T
A.2 Eligible taxonomy activities but not eco-sustainable (not taxonomy aligned)
Manufacture of electrical and
electronic equipment
CE 1.2 2,957,175.00 97.18% N/AM N/AM N/AM AM N/AM N/AM 0,00%
Manufacture of devices for
energy efficient buildings
CCM 3.5 - 0.00% N/AM N/AM N/AM N/AM N/AM N/AM 4.06%
Turnover from taxonomy eligible
activities but not eco-sustainable
(activities not aligned with the
taxonomy) (A.2)
2,957,175.00 97.18% 0% 0% 0% 97.18% 0% 0% 4.06%
Total (A.1 + A.2) 2,957,175.00 97.18% 0% 0% 0% 97.18% 0% 0% 4.06%
B. INELIGIBLE TAXONOMY ACTIVITIES
Turnover from ineligible taxonomy
activities (B)
85,911.00 2.82%
Total (A + B) 3,043,086.00 100.00%
Portion of turnover/Total turnover
Taxonomy alignment by objective Taxonomy eligibility by objective
CCM 0.00% 0.00%
CCA 0.00% 0.00%
WTR 0.00% 0.00%
CE 0.00% 97.18%
PPC 0.00% 0.00%
BIO 0.00% 0.00%
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02 Report on operations 50
Criteria for the sustainable contribution Criteria for “does no significant harm“
Economic activity (1)
Code/s (2)
Turnover (3)
Portion of expenses invoiced
2023 (4)
Climate change mitigation
of (5)
Climate change
adaptation (6)
Water and marine
resources (7)
Circular economy (8)
Pollution (9)
Biodiversity and
ecosystems (10)
Climate change
mitigation (11)
Climate change adaptation
(12)
Water and marine resources
(13)
Circular economy (14)
Pollution (15)
Biodiversity and ecosystems
(16)
Guarantees minimum
safeguards (17)
Aligned portion of capital
expenditure (A.1.) or
taxonomy eligible (A.2.)
2022 (18)
Category (enabling) (19)
Category (transitional) (20)
k € % Yes;No;N/AM Yes;No;N/AM Yes;No;N/AM Yes;No;N/AM Yes;No;N/AM Yes;No;N/AM Yes/No Yes/No Yes/No Yes/No Yes/No Yes/No Yes/No % A T
A. TAXONOMY ELIGIBLE ACTIVITIES
A.1 Eco-sustainable activities (taxonomy aligned)
Capital expenditure for eco-sustainable
activities (taxonomy aligned) (A.1)
- 0% 0% 0% 0% 0% 0% 0% No No No No No No No 0%
of which enabling 0% 0% 0% 0% 0% 0% 0% No No No No No No No 0% A
of which transitional 0% 0% No No No No No No No 0% T
A.2 Eligible taxonomy activities but not eco-sustainable (not taxonomy aligned)
Manufacture of electrical and
electronic equipment
CE 1.2 85,626.39 62.80% N/AM N/AM N/AM AM N/AM N/AM 0.00%
Manufacture of devices for
energy efficient buildings
CCM 3.5 - 0.00% N/AM N/AM N/AM N/AM N/AM N/AM 0.12%
Transport by motorbikes,
passenger cars and light
commercial vehicles
CCM 6.5 658.61 0.48% AM N/AM N/AM N/AM N/AM N/AM 0.31%
Installation, maintenance and
repair of energy efficiency
devices
7.3 CCM
/ 3.3 CE
- 0.00% N/AM N/AM N/AM N/AM N/AM N/AM 0.08%
Installation, maintenance and
repair of EV charging stations
in buildings
CCM 7.4 - 0.00% N/AM N/AM N/AM N/AM N/AM N/AM 0.01%
Capital expenditure for taxonomy
eligible activities but not eco-
sustainable (activities not aligned with
the taxonomy) (A.2)
86,285.00 63.29% 0.48% 0% 0% 62.80% 0% 0% 0.52%
Total (A.1 + A.2) 86,285.00 63.29% 0.48% 0% 0% 62.80% 0% 0% 0.52%
B. INELIGIBLE TAXONOMY ACTIVITIES
Capital expenditure for ineligible
taxonomy activities (B)
50,053.00 36.71%
Total (A + B) 136,338.00 100.00%
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02 Report on operations 51
Portion of CapEx/Total CapEx
Taxonomy alignment by objective Taxonomy alignment by objective
CCM 0.00% 0.48%
CCA 0.00% 0.00%
WTR 0.00% 0.00%
CE 0.00% 62.80%
PPC 0.00% 0.00%
BIO 0.00% 0.00%
De’Longhi Group
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02 Report on operations 52
Criteria for the sustainable contribution Criteria for “does no significant harm“
Economic activity (1)
Code/s (2)
Turnover (3)
Portion of expenses
invoiced 2023 (4)
Climate change mitigation
of (5)
Climate change
adaptation (6)
Water and marine
resources (7)
Circular economy (8)
Pollution (9)
Biodiversity and
ecosystems (10)
Climate change
mitigation (11)
Climate change adaptation
(12)
Water and marine
resources (13)
Circular economy (14)
Pollution (15)
Biodiversity and
ecosystems (16)
Guarantees minimum
safeguards (17)
Aligned portion of capital
expenditure (A.1.) or
taxonomy eligible (A.2.)
2022 (18)
Category (enabling) (19)
Category (transitional) (20)
k € % Yes;No;N/AM Yes;No;N/AM Yes;No;N/AM Yes;No;N/AM Yes;No;N/AM Yes;No;N/AM Yes/No Yes/No Yes/No Yes/No Yes/No Yes/No Yes/No % A T
A. TAXONOMY ELIGIBLE ACTIVITIES
A.1 Eco-sustainable activities (taxonomy aligned)
Operating expenses for eco-
sustainable activities (taxonomy
aligned) (A.1)
- 0% 0% 0% 0% 0% 0% 0% Sì Sì Sì Sì Sì Sì Sì 0%
of which enabling 0% 0% 0% 0% 0% 0% 0% Sì Sì Sì Sì Sì Sì Sì 0% A
of which transitional 0% 0% Sì Sì Sì Sì Sì Sì Sì 0% T
A.2 Eligible taxonomy activities but not eco-sustainable (not taxonomy aligned)
Manufacture of electrical and
electronic equipment
CE 1.2 85,418.00 94.32% N/AM N/AM N/AM AM N/AM N/AM 0.00%
Manufacture of devices for
energy efficient buildings
CCM 3.5 - 0.00% N/AM N/AM N/AM N/AM N/AM N/AM 0.81%
Installation, maintenance and
repair of energy efficiency
devices
7.3 CCM
/ 3.3 CE
- 0.00% N/AM N/AM N/AM N/AM N/AM N/AM 0.03%
Operating expenses for taxonomy
eligible activities but not eco-
sustainable (activities not aligned with
the taxonomy) (A.2)
85,418.00 94.32% 0% 0% 0% 94.32% 0% 0% 0.84%
TOTAL (A1+A2) 85,418.00 94.32% 0% 0% 0% 94.32% 0% 0% 0.84%
B. INELIGIBLE TAXONOMY ACTIVITIES
Operating expenses for ineligible
taxonomy activities (B)
5,146.00 5.68%
Total (A+B) 90,564.00 100%
Portion of OpEx/Total OpEx
Taxonomy alignment by objective Taxonomy alignment by objective
CCM 0.00% 0.00%
CCA 0.00% 0.00%
WTR 0.00% 0.00%
CE 0.00% 94.32%
PPC 0.00% 0.00%
BIO 0.00% 0.00%
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02 Report on operations 53
Ethics and compliance
Risk scenario
For information on the ethics and compliance risks,
as well as the relative risk management, please
refer to the section “Risk management and Internal
Control System relating to the financial reporting
process” found in the Report on Operations.
For information on the management of the risks
connected to ethics and compliance, please also
refer to the table “The main risks associated with
non-financial issues and management methods” in
the Note on Methodology.
Business and organizational model
Based on the Group’s management and organiza-
tional model, the Legal and Internal Audit divisions
work with the Financial Reporting Officer, to guar-
antee compliance with the law and regulations.
Both divisions also work with the Quality Division in
order to ensure adequate control of the products
and the qualification, as well as the assessment, of
suppliers (refer to the chapter “Product quality and
innovation”).
Internal Audit, together with the Financial Reporting
Officer, also check and assess the control system
in all the Group’s branches and audit the account-
ing processes and procedures, as well as
compliance with Law 262 relating to financial re-
porting processes. The purpose of these periodic
audits is to ensure that the company documents
are reliable, complete, accurate and timely, as well
as compliant with the Group’s operating, adminis-
trative and accounting policies. The audits are car-
ried out with a view to gradually covering all the
companies, paying particular attention to the most
relevant ones based on the audit plan coordinated
with the Director in charge and the Control, Risk,
Corporate Governance and Sustainability
Committee.
Internal Audit, together with the Financial Reporting
Officer also supervise the Enterprise Risk Manage-
ment (ERM) model, a management system devel-
oped and perfected by the Group over the years,
which focuses on the assessment and monitoring
of company risks. As part of this project, a number
of activities were carried out over the last few years
in order to integrate the ERM matrix with the risks
identified in each area by the Group’s management.
These include the implementation of a dynamic
risk management platform, which was rolled out
over the first few months of 2021 at the Group’s
most relevant companies. Consistent with the plan
forecasts, the rollout of the platform continued in
2022 and involved a growing number of compa-
nies; in 2023 Capital Brands and Eversys were in-
cluded, as planned.
In 2022 the risks linked to sustainability included on
the platform were updated in order to include the
risks linked to climate change identified in 2021.
More specifically these include: circularity, product
sustainability, compliance with health and safety
measures, environmental damage caused by oper-
ations, human rights, energy management, impact
on the stakeholders’ sustainability interests, local
communities, involvement of the communities in
sustainability initiatives and fair trade practices. In
2023, this mapping was confirmed and no further
additions were needed. At the same time work on
the risks identified continued in collaboration with
the heads of the divisions involved.
This platform is dynamic and allows selected users
to update the selection of risks in a timely and inde-
pendent manner, under the strict supervision of In-
ternal Audit and the Financial Reporting Officer, as
well as make changes to the risk map based on the
user profile in order to guarantee the utmost con-
trol and separation of roles. In 2022 the ERM plat-
form was also integrated directly with the SAP Suc-
cess Factor system which made it possible for all
personnel involved in assessments to access ade-
quate training in accordance with the law, which
was facilitated by a specific e-learning module.
In order to guarantee compliance with internal reg-
ulations and the current law in the various coun-
tries where the Group is active, as of 2015
additional control measures have been adopted in
order to identify potential episodes of abuse of
office and corruption. These initiatives are solely
preventive as Company does not maintain any
commercial relationships with the public
administration.
The Group also ensures that, in addition to trans-
parency and compliance, models of conduct have
been defined and implemented with a view to mini-
mizing the risk associated with illicit behavior, sub-
ject to sanctions under the law and regulations.
Toward this end as of 2018, the “Corporate Gov-
ernance Guidelines” were implemented at all the
Group companies. The administrative directors of
the different branches were responsible for the ap-
plication of these guidelines, which call for not only
the adhesion to the Group’s Code of Ethics, but also
define a system for the delegation of spending au-
thority. Lastly, the De’ Longhi Group’s Italian compa-
nies also adopted an “Organizational, Manage-
ment and Control Model” pursuant to and in
accordance with Legislative Decree 231/2001
which calls for the appointment of a Supervisory
Board charged with ensuring, independently, that
the directives and procedures of the Model are ap-
plied correctly. In 2019 the Group had already
adopted an internal control system which automat-
ically monitors the flow of information and the pro-
cesses controlled by the system used to prevent
De’Longhi Group
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02 Report on operations 54
send an anonymous report. In order to do this, a
dominion outside the company systems was creat-
ed which sends the information directly to the
Whistleblowing Committee, a body comprising
three Company members charged with analyzing
the reports and carrying out further investigations,
if necessary, of the reports received. No significant
reports have ever been received since the imple-
mentation of the system.
With regard to cyber security, the Group developed
a master data protection policy in 2020. During the
prior reporting year new security systems were in-
troduced to strengthen security and an automated
alert system was implemented which helps to
monitor, identify, analyze and prioritize any notices
received. The system also makes it possible to
send personalized messages to recipients.
The work group charged with the management of
this system comprises IT personnel, as well as
members of the legal team. With a view to further
increasing cyber security, the Company carried out
a campaign focused on increasing awareness in
this regard and training in the prevention and man-
agement of phishing was included in the training
plan. These activities continued in 2023, confirming
the Group’s commitment to preventing potential
problems relating to cyber security issues.
Key figures
No violations of the anti-corruption laws were re-
corded in the three-year reporting period (2021-23)
Information relating to persons apprised of the
company policies and procedures, as well as the
employees who received anti-corruption training is
shown below. There was a noticeable increase in
the figures thanks to the results achieved in 2023
by the Group. There was, in fact, an increase in the
number of employees and their training hours.
In 2023 the Board of Directors did not receive any
anti-corruption training or information about poli-
cies and procedures in this regard.
No legal complaints relating to anti-competitive,
anti-trust and monopolistic practices were filed in
the three-year period 2021-23. On 23 February
2023, however, the French competition authority
(the “FCA”) notified a few Group companies of a
complaint filed to the French company (and other
French sector companies, mentioned in the com-
plaint) which refers to certain acts that occurred
between 2009 and 2014 which were allegedly in vi-
olation of rules governing anti-competitive
conduct.
More specifically, the complaint alleges that the
Group entered into horizontal agreements which
consisted in the exchange between competitors of
privileged information relating to small appliances
in France in the period referred to above.
the crimes indicated in Legislative Decree 231.
In order to monitor transactions with related par-
ties and the relative risk, the Parent Company also
adopted a specific procedure which makes it possi-
ble to identity the transactions subject to specific
rules and approval, in accordance with the princi-
ples established by the Supervisory Authorities in
CONSOB Regulation n. 17221 of 12 March 2010.
Policies and objectives
The De’ Longhi Group’s Code of Ethics defines the
ethical standards that must be adhered to by em-
ployees and in the course of all the relationships
between the company and third parties, which
aspire to legality, transparency, fairness, integrity
and professionalism, as well as protection of priva-
cy. In order to allow new hires to familiarize them-
selves with these standards, as of 2020 short in-
duction sessions are held during which the
highlights of the Code of Ethics and the 231 Model
are illustrated. All new employees in Italy must pro-
vide signed confirmation of having received and
read the Code of Ethics.
As part of the Anti-Fraud Program defined based
on the guidelines of the Association of Certified
Fraud Examiners (ACFE), in 2023 the Group moved
forward with the improvements called for in prior
years.
With regard to the whistleblowing platform, in 2023
the platform was again fully operative, and may be
used by employees, suppliers and customers to
De’Longhi Group
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02 Report on operations 55
Category
Europe* America & Asia-Pacific** MEIA
12
De’ Longhi Group
2021 2022 2023 2021 2022 2023 2021 2022 2023 2021 2022 2023
Number of people with whom the company’s anti-corruption procedure and policies were shared
Managers 177 162 214 67 82 78 4 4 4 248 248 296
White collars 1,745 1,829 2,014 511 598 531 25 25 23 2,281 2,452 2,568
Blue collars 4,481 918 4,170 3,820 1,771 3,746 - - - 8,301 2,689 7,916
Total employees 6,646 2,909 6,398 4,398 2,451 4,355 29 29 27 11,073 5,389 10,780
Commercial partners - - 285 - - - - - - - - 285
Employees who received anti-corruption training
Managers 22 44 22 9 7 10 - - - 31 51 32
White collars 326 340 121 114 108 135 - - - 440 448 256
Blue collars - 2 - 9,355 2,090 5,837 - - - 9,355 2,092 5,837
Total employees 348 386 143 9,478 2,205 5,982 - - - 9,826 2,591 6,125
12
MEIA refers to the countries located in the Middle East, India and Africa.
* The figures for Italy are included in Europe.
** The hours of training for new hires, which addresses business ethics and anti-corruption, are taken into consideration for America & Asia-Pacific.
The French Competition Authority concluded that
the practice of exchanging information, to the
extent that it restricted market competition, consti-
tutes an anticompetitive agreement prohibited by
the Art. 420-1 of the French Commercial Code and
Art. 101, paragraph 1, TFUE.
The complaint is currently being analyzed carefully
by the Group which is preparing its defense with
the support of premiere legal counsel and sector
consultants. It is not yet possible to assess the
possibility or the size of any sanctions. The Group
believes that there are sound arguments to be
made in its defense.
Similarly, no economic or in-kind contributions
were made to political parties, elected
representatives or people looking to hold political
office in the three-year period subject to
examination.
As for the number of complaints relating to dis-
crimination, two incidents of sexual harassment
were reported at De’Longhi Australia PTY LTD. The
Group does not tolerate any behavior that could
compromise the respect, diversity, rights and
safety of its employees at the workplace. For this
reason, after quick and in-depth internal investiga-
tions, the Company decided to terminate the em-
ployment of the individuals involved.
Furthermore, in 2023 a case of possible discrimina-
tion was reported at De’Longhi Kenwood A.P.A. LTD;
subsequently, upon further investigation the
discriminatory nature of the episode was not
confirmed.
Lastly, consistent with full disclosure in tax matters,
the Group operates in complete transparency and
in accordance with local and international tax laws.
De’Longhi Group
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02 Report on operations 56
Human resources
management
Risk scenario
People are one of the elements that lie at the foun-
dation of the De’ Longhi Group’s identity and suc-
cess. Aware of their key role and the multicultural
environment that it operates in, the Group is com-
mitted to guaranteeing a dynamic and engaging
workplace, which respects the highest health and
safety standards and, at the same time, takes the
personal and professional needs of all its people
into account. In order to achieve this objective,
each individual of the Group needs to own the com-
pany values, contributing directly to the construc-
tion of a positive environment which implicates
that each resource acts with ambition, courage,
passion, expertise and teamwork, guaranteeing
mutual respect both inside the company and in the
interactions with customers, suppliers and other
stakeholders.
For more detailed information on the risks connect-
ed to human resources management and risk man-
agement, please refer to the paragraph 9 of the
section “Risk factors for the De’Longhi Group” (ref-
erence should be made to the chapter “Risks relat-
ing to the organization and management of human
resources”).
With regard to the measures used to mitigate and
manage human resource risks please also refer to
the table “The main risks associated with non-fi-
nancial issues and management methods” in the
Note on Methodology.
De’Longhi Group
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02 Report on operations 57
Business and organizational model
The Chief People Officer coordinates the Human
Resources Division which is responsible for the
management and development of human resourc-
es for the entire Group. On a local level, this respon-
sibility is entrusted to specific structures, which are
found in the main geographical areas and the
Group’s more structured branches. These struc-
tures have many duties which include, mainly, all
administrative aspects of employee relationships,
the management and development of internal re-
sources, talent acquisition, training and retention,
as well as internal communications, labor union re-
lations, development of important initiatives tied to
both employee engagement and the organization
of workplace safety.
The corporate HR structure was defined based on
the organizational changes made by the Group
over the years and is broken down based on four
main macro-clusters, dedicated to four specific
areas:
• Brand Headquarters and commercial organiza-
tion Europe
• Corporate Staff, Services and Organization, Op-
erations Europe
• Commercial organization Asia Pacific and Oper-
ations China
• Commercial organization Americas and MEIA
The Chief People Officer is responsible for the su-
pervision of the remaining commercial units.
The employee journey begins with the attraction
phase which is managed globally by Talent Acquisi-
tion and Employer branding. The latter is crucial to
the Group’s activities and allows for a structured
and integrated approach to the recruiting of new
resources. A number of initiatives were developed
in association with the employer branding strategy
focused on increasing the recognition of the Group
globally. These include updating the People section
of the corporate website and the introduction of a
new global Linkedin page, which substituted the
previous pages dedicated to single countries which
resulted in a significant increase in the number of
followers and visits in 2023, also. The number of
page followers, in fact, rose from 58.3 thousand at
year-end 2022 to 66 thousand at year-end 2023
(+14%). The most successful social strategies re-
sulted in the publication of 107 posts, 2 each week,
relating to 5 topics: Sustainability, Training, Career,
Business and Innovation, consistent with what hap-
pened in 2022. More in detail, new multimedia for-
mats were created, focused primarily on video con-
tent. This approach made it possible to reach a
total of 752,882 impressions (+10% compared to
the prior year). The most successful posts include
the one of the Smart Design project, completed in
partnership with Milan’s Politecnico and the one of
a few students from Oradea University visiting the
Salonta plant. Even though the Group’s main audi-
ence is still Italian, in 2023 there was a significant
increase in the European (+83%) and North Ameri-
can (+127%) audience, a sign of the Group’s grow-
ing international presence.
With respect again to talent attraction, for years De’
Longhi has cultivated strategic relationships with
Italy’s best universities, like Milano’s Politecnico
and Bocconi University: in order to strengthen the
tie with the academic world structured partner-
ships were established with a view not only to at-
tract the best talents, but also to increase research
and training in collaboration with the two schools.
The partnership with Politecnico, for example, calls
for the Group’s participation in events and training
courses tied to innovation, research and develop-
ment. During these courses, Group management
dedicate time and expertise in order to interact di-
rectly with youth, involving them in training projects
and activities related to De’ Longhi’s business. A
relevant event in this regard was the participation
of the Company’s General Manager in Transforma-
tive Sustainability master’s program at Bocconi Uni-
versity where the sustainability path undertaken by
the Group was presented and the commitment that
companies must have to become key players in the
creation of a sustainable future was discussed.
Similar to prior years, in 2023 one of the strategic
choices made by the De’ Longhi Group was to en-
hance and increase the knowhow of its company
resources, investing in the improvement of soft
skills and technical expertise, including as a result
of the noticeable increase in employees. Conse-
quently, there was an increase in both the number
of training hours (+20%) and the number of
participants.
This result was achieved also and above all thanks
to the projects and training tools developed over the
last few years including, specifically, with regard to
e-learning. More in detail, the PULSE platform, which
has already been used by Human Resources for sev-
eral years, also allows Group employees to create
personalized learning plans based on specific needs,
as well as access an on-line catalogue and e-learn-
ing courses. As in 2022, the Group continued to use
the Speex and Of Course Me platforms in 2023: the
first provides language courses and the second pro-
vides information and useful materials on a vast
range of topics in a single digital platform. This
allows employees to get to know more about topics
they are interested in and are relevant to their profes-
sional development by creating a personalized train-
ing course. In 2023, the Global Catalogue proposed
23 courses focused on managerial, communication
and digital skills, as well as relating to digital think-
ing. This initiative had wide participation, as well as
an enthusiastic reception: the average satisfaction
rating was 4.3 out of 5.
In 2023 the Digital Lab continued. Digital Lab is an
ad hoc training initiative conceived to improve the
digital expertise of employees working in the Mar-
keting and Commercial divisions and sustain the
growth of the Group’s e-commerce channel.
Looking again at digital expertise, in April 2023, 117
employees working in the IT division from Italy,
Germany, the United Kingdom and Romania partic-
ipated in an assessment organized by the Human
Resources division. The main objective was to
assess the digital skills of IT department employ-
ees, focusing mainly on hard skills, soft skills and
understanding of the main innovation topics. The
results obtained by the assessment allowed the
team responsible for the project to build a training
path called “Innovation Breakfast”, series of morn-
ing webinars focused on exploring emerging
trends in innovation. These meetings, comprised of
4 sessions of around 1 hour each, were launched in
November 2023 and ended in January 2024.
In 2023 the Group also launched the Sustainability
Learning Journey, which is part of a broader sus-
tainability strategy and provides training on topics
related to this topic: De’ Longhi’s goal is to render its
employees more knowledgeable as to the impact
that their positive actions could have on promoting
a better future. The Group, therefore, structured a
training course focused on this topic: the first event
involved an exceptional guest, renowned
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02 Report on operations 58
economist and Nobel Prize Winner Prof. Joseph
Stiglitz who focused his speech on sustainable de-
velopment of businesses. The presentation was
held at the Treviso headquarters and colleagues
from the international branches could connect via
streaming.
Subsequently, courses and content were published
on the Pulse platform which made it possible for
employees to learn more about the topics dis-
cussed. In 2024, the path just described will move
toward a call to action phase during which employ-
ees will be invited to share the best sustainability
practices.
Over the last few years, the Group has also actively
promoted the Diversity Equity and Inclusion
(DE&I) project, which aims to guarantee equal op-
portunity and the lack of discrimination. The pro-
ject can be broken down into four phases:
1. Diagnosis: the objective of this phase is to let
the DE&I decisions be shaped by the analysis
made of the data gathered by the Group. More
specifically, the internal population was mapped
and information was gathered through inter-
views and surveys;
2. Commitment and involvement: Human Re-
sources involved top management through ded-
icated interviews and, subsequently, organized
a workshop during which the results obtained
were shared and the Group’s priorities were de-
fined together with the company’s leadership
team;
3. Action: in this phase, the De’ Longhi Group de-
velops a roadmap of the long-term goals and
the actions that need to be taken to achieve
them, through DE&I projects, policies and
practices. While the drafting of the roadmap
was completed in 2023, beginning in 2024 the
Company will begin to share the strategies and
guidelines adopted with all the Group’s person-
nel; and lastly will proceed to define local plans
of action.
4. Monitoring and accountability: the actions un-
dertaken and the goals defined in the roadmap
will be monitored over time by Human Resourc-
es, in order to assess the project’s performance,
the results achieved and define any needed cor-
rective strategies.
Human Resources guides the global performance
appraisal process conceived to promote growth
and the development of employees. This program
is based on a dedicated system which fosters an
open and constructive dialogue between managers
and employees. The path, called FORWARD, was
tested for the first time in 2021 and used Group-
wide in 2022. In 2023 employees and managers
were more familiar with the process than in the
prior year and the completion rate, in fact, rose to
up to 85% of the total (+5%) and there was an in-
crease in the feedback shared which went from
2,500 to almost 5,000.
The performance appraisal cycle can be broken
down into three main phases:
1. Set Up: individual targets are defined and
growth strategy consistent with the company
strategy and the team goals is defined;
2. Sync: regularly scheduled checkpoints for feed-
back and self-reflection are organized in order
to render the employee’s growth part of an on-
going and interactive process.
3. Wrap Up: the comments made by employees
are gathered so the manager can provide a
complete, objective and constructive assess-
ment of target achievement. These targets typi-
cally focus on employee enhancement, under-
standing of what can be improved and
recognition of the talents that emerged.
The actions taken to protect the
Group’s personnel
For the De’ Longhi Group, the sustainability of a suc-
cessful manufacturing project is based largely on
the ability to address and protect the health and
safety of its employees: in order to achieve this ob-
jective, Human Resources leverages on the support
of people charged with promoting worker health and
safety like the Head of the Prevention, Protection
and Environment Department in Italy, Switzerland,
China and Romania where the Group’s production
plants are located. Their responsibilities include as-
sessing the risks inherent in the activities carried out
by the Group employees and defining plans for im-
provement. Particular attention is paid to ergonomic
work stations, both in the plants and the offices, in
order to guarantee a safe and comfortable work
environment.
In 2022 the Group had already begun work on a plan
for risk mitigation and further improvement in work-
place safety. The initiative, carried out by a
cross-functional HR/Operations team which fo-
cused on the analysis of risks relating to production
organization and the supply chain. The goal is to
define a multi-year, step-by-step path which reinforc-
es a “Zero accident mindset”. The team developed a
monitoring system which assesses the progress
made toward achieving the “zero accident” goal. In
2023 the global “I am Safety” campaign was also
launched: the initiative, part of the sustainability
strategy, has three main objectives: strengthen and
spread a safety culture throughout the Group, in-
volve and make employees responsible for issues
linked to safety and, at the same time, improve effi-
cacy and productivity through initiative focused on
“new ways of working”, with a particular focus on
smart working.
In the production plants the initiative was realized
through the “Safety Ambassadors” campaign, based
on which a few employees were appointed safety
ambassadors. The project, which for now has been
implemented in the Company’s production facilities,
was structured based on three phases:
1. Appointment of the ambassadors: the ambas-
sadors are employees who are chosen to safe-
guard aspects of Health, Safety and the Environ-
ment (HSE) in each production facility. In order
to identify the best people for the assignment,
the work team developed an identikit of the
characteristics needed to cover this role;
2. Training of the ambassadors: the ambassa-
dors selected completed a dedicated training
course in order to understand the role and re-
sponsibilities involved;
3. Identification of any equipment needed: in this
phase any investments needed to improve the
health and safety inside the plants are quanti-
fied, along with the anticipated benefits.
In light of the success of this first test of the Am-
bassador campaign inside the plants, the Group
plans on expanding this initiative in the branches,
as well.
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02 Report on operations 59
In the branches and at headquarters the focus of
the campaign will be on the white collar workers
and the “new ways of working”, as well as wellbe-
ing in the workplace in order to support a positive
work experience.
Policies and objectives
The Group’s focus on its people is fully expressed in
its Code of Ethics which dedicates an entire section
to this topic. The Code of Ethics condemns undoc-
umented working relationships, any form of ex-
ploitation (including child labor) and any undue ad-
vantage over workers. Equal opportunities are
promoted throughout the professional cycle, from
selection through career advancement, avoiding
any and all forms of discrimination.
With regard specifically to the workplace health
and safety, the Code of Ethics also requires that
each employee pay the utmost attention to adher-
ing to all of the safety and preventive measures,
while also complying with all the instructions and
directives in effect. In particular, health and safety
aspects are particularly relevant at production
plants where workers are exposed to greater risks
and, therefore, accident prevention and mitigation
procedures have been adopted. Toward this end,
the Mignagola plant in Treviso, Italy and the facili-
ties in Cluj and Salonta, Romania developed operat-
ing system in preparation for adoption of ISO
450001:2018, the most widely known international
standard for work and safety. This certification was
obtained at the plants in Sierre (Switzerland) and
Dongguan (China); as of February 2024 this certifi-
cation is also in place in OnShiu (China).
Lastly, the Company formalized a policy dedicated
to the integrated management of HR topics which
also includes the compensation of the Board of Di-
rectors and the executives. In 2019 a Group MBO
policy was introduced which aims to create a link
between compensation and results and strengthen
the sense of belonging and De’ Longhi’s identity.
Key figures
The Group had 9,837 employees at 31 December
2023, an increase of 15% compared to the prior
year. The reporting year was characterized by a re-
covery in production which resulted in an increase
in the number of Group employees.
Women represent 50% of the De’Longhi Group’s
workforce, in line with the prior year. This reflects
De’ Longhi’s commitment to strategies to promote
equal opportunities. 90% of the employees have
permanent contracts, in line with the prior reporting
year (93% in 2022).
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Employees by contract type
Italy Europe America & Asia-Pacific MEIA De’ Longhi Group
2021 2022 2023 2021 2022 2023 2021 2022 2023 2021 2022 2023 2021 2022 2023
Number of employees by contract type
Permanent positions 1,708 1,710 1,658 4,624 3,837 4,477 2,710 2,387 2,637 58 52 54 9,100 7,987 8,826
women 676 684 676 2,776 2,271 2,573 1,273 1,110 1,201 23 21 22 4,748 4,086 4,472
men 1,032 1,026 982 1,848 1,566 1,904 1,437 1,277 1,436 35 31 32 4,352 3,901 4,354
Temporary positions 31 22 15 417 171 567 803 374 429 1 1 - 1,252 568 1,011
women 17 15 8 211 61 253 358 200 210 - 1 - 586 277 471
men 14 7 7 206 110 314 445 174 219 1 - - 666 291 540
Total 1,739 1,732 1,673 5,041 4,008 5,044 3,513 2,761 3,066 59 53 54 10,352 8,555 9,837
Number of employees by contract type
Full-time 1,637 1,635 1,581 4,784 3,778 4,738 3,484 2,751 3,062 58 52 53 9,963 8,217 9,434
women 594 604 595 2,789 2,155 2,602 1,613 1,301 1,407 23 21 21 5,019 4,081 4,625
men 1,043 1,031 986 1,995 1,623 2,136 1,871 1,450 1,655 35 31 32 4,944 4,136 4,809
Part-time 102 97 92 257 230 306 29 10 4 1 1 1 389 338 403
women 99 95 89 197 180 224 18 9 4 - 1 1 314 285 318
men 3 2 3 60 50 82 11 1 - 1 - - 75 53 85
Total 1,739 1,732 1,673 5,041 4,008 5,044 3,513 2,761 3,066 59 53 54 10,352 8,555 9,837
Number of employees by gender
Total women 693 699 684 2,987 2,332 2,826 1,631 1,310 1,411 23 22 22 5,334 4,363 4,943
Total men 1,046 1,033 989 2,054 1,676 2,218 1,882 1,451 1,655 36 31 32 5,018 4,192 4,894
During the year the Group hired approximately 1,050 contract workers at the production plants.
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02 Report on operations 61
Breakdown of the workforce
Unit of
measure
De’ Longhi
Group
2021
De’ Longhi
Group
2022
De’ Longhi
Group
2023
Manager
Men
< 30 years % - -
-
>30 < 50 years % 2% 1.9%
1.5%
> 50 years % 1.2% 1.4%
1.2%
Total men % 3.2% 3.3%
2.7%
Women
< 30 years % - -
-
>30 < 50 years % 0.7% 0.7%
0.6%
> 50 years % 0.1% 0.2%
0.2%
Total women % 0.9% 0.9%
0.8%
Total % 4.1% 4.2%
3.5%
White collars
Men
< 30 years % 2.3% 2.8%
2.4%
>30 < 50 years % 10.2% 13.3%
11.6%
> 50 years % 3.4% 4.2%
3.9%
Total men % 15.9% 20.3%
17.9%
Women
< 30 years % 2.4% 3.0%
2.3%
>30 < 50 years % 9.1% 11.2%
9.8%
> 50 years % 2.1% 2.5%
2.5%
Total women % 13.5% 16.8%
14.6%
Total % 29.4% 37%
32.4%
Blue collars
Men
< 30 years % 7.7% 4.5%
6.9%
>30 < 50 years % 15.5% 14.6%
15.6%
> 50 years % 6.2% 6.4%
6.7%
Total men % 29.4% 25.5%
29.2%
Women
< 30 years % 6.7% 4.6%
5.7%
>30 < 50 years % 22.5% 20.8%
20.6%
> 50 years % 7.9% 7.8%
8.6%
Total women % 37.1% 33.2%
34.9%
Total % 66.5% 58.7%
64.1%
In 2023, the De’Longhi Group’s BoD comprised 6 men and 5 women, of which around 90% over the age of 50.
Composition of the Parent
Company’s BoD
U.M. 2021 2022 2023
Men
< 30 years n - - -
>30 < 50 years n - - -
> 50 years n 8 6 6
Total men n 8 6 6
Women
< 30 years n - - -
>30 < 50 years n 1 1 1
> 50 years n 3 4 4
Total women n 4 5 5
Total n 12 11 11
In order to foster the knowledge and expertise of its people, as well as ensure adequate training in terms of
health and safety, in 2023 the De’Longhi Group provided an average of 24 hours of training to each employee
(+ 6% compared to 2022).
Training U.M.
De’ Longhi Group
2021 2022 2023
Average hours per employee Average hours 21.7 23.0 24.3
Training U.M.
De’ Longhi Group
2021 2022 2023
Training by job level
Average hours for managers Average hours 14.3 15.5 21.7
Average hours for white collars Average hours 17.6 19.9 22.9
Average hours for blue collars Average hours 23.9 25.5 25.1
Training by gender
Average hours for women Average hours 20.3 21.8 22.1
Average hours for men Average hours 23.1 24.3 26.4
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With regard to workplace health and safety, the
Group recorded a total of 56 accidents over a total
of more than 20 million hours worked in 2023. This
figure, lower with respect to the trend seen in the
last two years, attests to the efficacy of the
Injuries and rate of injury by geographic area
Italy Europe America & Asia-Pacific MEIA
2021 2022 2023 2021 2022 2023 2021 2022 2023 2021 2022 2023
Total hours worked h.000 2,887 2,799 2,820 8,285 7,356 8,073 9,935 8,595 9,410 119 121 117
Injuries n. 13 16 8 20 10 31 49 26 17 - 2 -
In transit using means organized by the Group n. - - - 4 - 4 - - - - - -
Serious injuries n. - - - - - - - - - - - -
Fatal injuries n. - - - - - - - - - - - -
Occupational disease n. 1 2 2 - - - 1 - - - - -
Frequency rate
13
- 4.5 5.7 2.8 2.4 1.3 3.8 4.9 3.0 1.8 - 16.4 -
Severity rate
14
- - - 0.7 - - - - - - - - -
Mortality rate
15
- - - - - - - - - - - - -
Rate of occupational disease
16
- 0.3 0.7 0.7 - - - 0.1 - - - - -
13 The frequency rate is the total number of injuries expressed as a percentage of the total number of labor hours worked in the
same period, multiplied by 1,000,000, excluding commuting accidents.
14 The severity rate is the total number of serious accidents expressed as a percentage of the total number of labor hours worked in
the same period, multiplied by 1,000,000.
15 The mortality rate is the total number of fatalities expressed as a percentage of the total number of labor hours worked in the
same period, multiplied by 1,000,000.
16 The rate of occupational disease is the total number of occupational disease expressed as a percentage of the total occupational
disease and the number of labor hours worked in the same period, multiplied by 1,000,000.
measures adopted by the company and is a clear
demonstration of how the level of attention paid to
these issues is producing positive, tangible results.
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Injuries and rate of injury
De’ Longhi Goup
2021 2022 2023
Total hours worked h.000 21,227 18,873 20,420
Injuries n. 82 54 56
In transit using means organized by the Group n. 4 - 4
Serious injuries n. - - -
Fatal injuries n. - - -
Occupational disease n. 2 2 2
Frequency rate - 3.9 2.9 2.7
Severity rate - - - -
Mortality rate - - - -
Rate of occupational disease - 0.1 0.1 0.1
Injuries and rate of injury for contract workers at the production
facilities
De’ Longhi Goup
2021 2022 2023
Total hours worked h.000 5,343 2,120 3,046
Injuries n. 12 14 18
In transit using means organized by the Group n. 7 5 7
Serious injuries n. - - -
Fatal injuries n. - - -
Frequency rate - 2.2 6.6 5.9
Severity rate - - - -
Mortality rate - - - -
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Quality
and product innovation
Risk scenario
The De’ Longhi Group applies a business model
which focuses high quality products, key to main-
taining consumer confidence and a solid market
reputation, as well as essential to long-term profita-
bility and business continuity. As it operates inter-
nationally, the Group must continuously address a
complex and ever-changing regulatory environ-
ment; therefore, it systematically allocates signifi-
cant resources to ensuring compliance with the
different requirements applied in the different juris-
dictions it interacts with. Toward this end, based
on the local for global approach adopted by the
Company, all the products distributed must comply
with the most stringent standards applicable in the
numerous countries where the Group is present.
Examples of the most well-known international reg-
ulations include EU Regulation n. 1907/2007 or
REACH (Registration, Evaluation, Authorization and
Restrictions of Chemicals) and the RoHS (Restric-
tions of Hazardous Substances) directive 2002/95/
EC, both of which the Group’s companies comply
with across all geographies even though the scope
of application is strictly European.
Furthermore, the law also requires that the Group
assumes the manufacturers’ responsibilities for
damages caused by defective products, which en-
tails certain obligations above all in jurisdictions
like the United States, the United Kingdom and
Australia.
The manufacturer is also responsible for providing
detailed product information which may vary based
on specific laws and local regulations. In the United
States, for example, the De’Longhi Group is subject
to “Proposition 65” based on which the presence of
any hazardous substances must be indicated
clearly on the labels.
The adequacy and effectiveness of the practices
mentioned above are guaranteed by the Group’s
Product Safety&Liability team. The latter collabo-
rates with both the technical departments and the
branches, working proactively to prevent product
risks, as well as manage any market complaints or
reports generated internally. In 2023 the Group
continued with its monitoring activities and man-
aged any reports received more effectively.
For more information about the risks connected to
quality and product innovation, as well as risk man-
agement, please refer to the section “Risk factors
for the De’Longhi Group”, specifically paragraphs 5
(“Risks relating to the De’Longhi Group’s ability to
achieve continuous product innovation”), 6 (“Risks
relating to patents and trademarks”) and 10 (“Risks
relating to product quality and product liability”).
For more information on the measures used to mit-
igate and manage risks relating to product quality
and innovation, please refer to the table “The main
risks associated with non-financial issues and
management methods” in the Note on
Methodology.
Business and organizational model
The De’ Longhi Group’s Quality Division, formed by
more than 500 specialized personnel, is dedicated
to the supervision of everything that concerns
compliance with current laws and regulations re-
lating to product and food safety. The different
teams include Regulatory Affairs which monitors
any changes in international regulations and laws
relating to products and contributes to develop-
ment also by working with the Group’s different
technical divisions. The Quality Division also de-
fines the guidelines for product control. The corpo-
rate provisions defined are adopted and applied lo-
cally by dedicated teams which operate on two
levels: on the one hand, they work to monitor the
quality of both the products which come from ex-
ternal suppliers and the ones made internally; on
the other they monitor the quality of product cate-
gories being developed and when market com-
plaints are received. The controls are carried out
already during the design phase in order to prevent
any anomalies or product malfunctions, as well as
ensure that the highest safety standards are
achieved.
With regard to the production plants, the organiza-
tional model adopted by the Group is ISO 9001 cer-
tified, which calls for a product quality manage-
ment system.
Looking at food safety, at the Mignagola and Cluj
plants an ISO 22000 certified management model,
De’Longhi Group
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02 Report on operations 65
which relates specifically to hygiene and food
safety, was implemented. This standard, which is
based on the HACCP (Hazard Analysis and Critical
Control Points
17
) principles and the Codex Alimen-
tarius
18
makes it possible to identify and manage
possible risks, prevent accidents along the entire
production chain, as well as assess the compliance
of products with current regulations. In all the other
production facilities, the Group adopted an organi-
zational model which, in addition to the same
standard, is informed by the Good Hygienic Prac-
tices (GHP) and the ISO 1672-2
19
standard for
food safety which also takes into account the ISO
22005
20
product traceability standards and re-
quirements in order to provide, for each component
and market product, information relating to the
origin and recipient of the product.
During the pre-production phase, through a particu-
larly granular verification process, all the Group’s
products are certified by independent bodies in
order to further guarantee compliance with all ap-
plicable regulations and laws. Furthermore, the
Quality division also carries out specific audits (see
the “Supply chain management” section) in order to
control and monitor the suppliers’ compliance with
the production standards.
With regard to product information, the technical
departments work with the Marketing Division to
ensure that the labels and booklets created comply
with the regulations specific of all the countries
where the products are distributed. The Group pays
careful attention to the product booklets and labels
which, in order to meet the legal obligations must
comply with specific requirements, including, for
example, the need to include the product’s country
of origin and the presence of any refrigerants in the
household appliances. It is extremely important
that the instructions relating to how to safely use
and dispose of the product at the end of its life
cycle is also provided in the product manuals.
The Operations and Technology Division promotes
innovation and oversees design. Its main objective
is to develop well designed products that are easy
to use and versatile, characterized by a distinctive
design which is ergonomic, safe and easy to disas-
semble. The use of high quality materials and tech-
nologies which are energy efficient and promote
food safety is also essential.
Looking once again at design, the Group refers to
Specific NPD (New Project Development) proce-
dures, which provide transversal guidelines for the
development of new products. These procedures
are followed by the Marketing and Design divisions,
as well as the technicians, which comprise a team
of people spread out between the offices in Italy,
Germany, the United Kingdom and the Dongguan
plant in China. These offices, together with the
Quality Division’s Regulatory Team, are dedicated
to designing solutions which comply with applica-
ble laws. The Group’s local for global approach, re-
ferred to above, ensures that products are devel-
oped in compliance with the standards applicable
in the countries in which the Group operates.
The constant development of innovative products
is also the result of the effective partnerships be-
tween Operations and Technology, several prestig-
ious Italian and international universities, as well as
a few commercial partners for which the De’Longhi
Group designs and manufactures a collection of
coffee products. In 2022, as part of these partner-
ships with the academic world, “Eco-Design
Guidelines” were developed for a specific range of
De’ Longhi products in collaboration with Milan’s
Politecnico. More in detail, the goal of these strate-
gic guidelines is to develop the expertise, for the
entire product development community, needed to
reduce the environmental impact of products
across the entire life cycle in a regulatory environ-
ment that changes constantly. In 2023 the imple-
mentation of these practices was focused on ten
pilot products which will be analyzed as deemed
opportune to ensure a more organic and complete
integration of Eco-design standards in the develop-
ment process of all De’ Longhi products. Three
Life Cycle Assessments were also carried out in
order to measure and classify the most significant
sources of any environmental impacts.
Policies implemented and objectives
The Group’s commitment to making high quality
products is supported by ongoing research and de-
velopment, focused on safety and consumer wellbe-
ing – this commitment is formalized in the Compa-
ny’s Code of Ethics which emphasizes the goal of
maintaining high quality standards for consumers
and clients.
Lastly, some time ago the Company adopted a
group-wide Quality Policy.
Key figures
One of the key performance indicators that the
Group uses to monitor quality, the First Time Quali-
ty Indicator (FTQ) assesses the qualitative efficien-
cy of the production process. This indicator is used
to identify any functional or esthetic defects of the
products and expresses the number of perfect
products as a percentage of total production. In the
three-year period 2021–2023, the overall FTQ was
stable (98% in 2023) confirming the Group’s excel-
lent performance. The Service Call Rate (SCR),
rather, measures the percentage of machines re-
paired in the first year under warranty: in this in-
stance, also, the SCR was unchanged with respect
to the prior reporting year.
In 2023 there were no instances of non-compliance
related to product safety. With regard to product
information and labeling, in 2023 notice was
17 The hazard analysis and critical control points or HACCP, is
a systematic preventive approach relating to food safety
and protection from production related biological, chemi-
cal, and physical hazards.
18 The Codex Alimentarius is a collection of standards, codes
of practice, guidelines, and other recommendations adopt-
ed by the Food and Agriculture Organization of the United
Nations to protect the health of consumers and promote
equitable and practices in the food business.
19 This standard establishes the requirements for common
hygiene practices for machines used to prepare food for
human consumption in order to eliminate or reduce the risk
of contagion, infection, sickness or food induced
damages.
20 This standard incorporates regulations relative to traceabil-
ity systems for food products and applies them across the
agri-food sector. By adopting this standard, the company
guarantees the product history will be document and then
places it in the relative food chain.
De’Longhi Group
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02 Report on operations 66
received of one instance of noncompliance. More
specifically, the CCIAA (Camera di Commercio, In-
dustria, Artigianato e Agricoltura) of Trento identi-
fied a non-compliance connected to the lack of a
safety warning in the instruction manual for an
Ariete tea kettle, Model 2877. The Group then up-
dated the labeling of the products still in stock.
Lastly, as in prior years, the Company continued
with its investments in research and development
aiming to enhance its capacity for innovation
(please refer to the section “Research and develop-
ment – quality control” for more information). A
few of the product designs which exemplify
De’Longhi Group’s characteristic innovation are de-
scribed below:
Durable and detachable products
In order to ensure durability, the Group carries out
numerous resistance tests during the development
process. For example, the tests involving coffee
machines are applied to both single components,
as well as the finished product, by making thou-
sands of drinks. Similar initiatives are underway for
the Kenwood kitchen machines.
De’ Longhi is committed to making products that
are easy to repair, thanks to the work done on im-
proving the ease of disassembly and the standardi-
zation of a few key mechanical parts that are
shared across product families. The continuous
dedication to creating products with these charac-
teristics has made it possible for different Braun
brand products, like the new TexStyle 7 Pro, the
PowerBlend 9 and the MultiQuick MQ 7, to receive
the prestigious Red Dot prize – clear recognition of
the high quality of these products.
Lastly, as already pointed out in prior years, the fully
automatic coffee machines are equipped with pat-
ented systems which facilitate washing with water,
without having to use detergents and lubricants.
The milk system is cleaned using steam and hot
water at the end of each use, and any remaining
milk can be stored in the refrigerator and used
again.
Energy efficient and low GHG emissions
products
The De’ Longhi Group is deeply committed to the
energy efficiency of its products.
This is demonstrated by the fact that the entire
range of fully automatic coffee machines, as well
as the Lattissima and electronically controlled
manual machines, are at least energy class A
21
.
The development of systems which reduce the
time needed for automatic shutdowns, the optimi-
zation of consumption during the stand-by phase
(reaching levels which are half the regulatory mini-
mum) and the development of an innovative heat-
ing system for the filter cup, are just a few exam-
ples of the work down in this regard.
Also, for many years all the fully automatic ma-
chines have been available in “Ecomode” which
makes it possible to save energy during the warm-
up phase.
With regard to comfort, the migration of the whole
range of European portable air conditioners to re-
frigerant propane gas was completed several years
ago. This refrigerant has significant environmental
advantages as it is a natural gas which has a lower
impact on global warming (Global Warming Poten-
tial – GWP). In the US market, where the use of this
gas is illegal, in 2021 the Group completed the mi-
gration of all the air conditioners to refrigerant
synthetic R32 gas, which has a lower GWP impact
compared to the gases used previously; while it is
not as efficient as propane, it represents the best
possible solution allowed under US law. Currently,
the laws in this regard are subject to continuous
change and the Group is already working on the de-
velopment of technologies which will make it pos-
sible to keep up with the relative legislative context.
Healthy lifestyle products
The De’ Longhi Group’s strategies for new product
development include promoting healthy lifestyles.
The Group aims to preserve the nutritional ele-
ments of foods through its products: toward this
end, Kenwood developed a line of Pure Juice ex-
tractors. Thanks to scrolling technology, the Pure
Juice line is able to reduce the overheating and oxi-
dation of ingredients making it possible to preserve
the nutritional properties of the fruits and vegeta-
bles. The Multifry fryers also cook with hot air
which reduces the use of vegetable oils.
All the De’Longhi brand coffee machines, fully auto-
matic and manual, are also equipped with electron-
ically controlled boiler temperatures which makes
it possible to maintain conditions that are ideal for
the ground coffee, safeguarding its organoleptic
properties and enhancing its aroma.
21 Beginning in 2009, the FEA (Swiss Association of the do-
mestic appliances industry) in agreement with the Swiss
authorities, introduced the energy label for espresso ma-
chines, which became mandatory in 2014 for all machines
sold in the Swiss market. In this context, the De’Longhi
Group has decided to extend the certification in accord-
ance with the standard EN 60661/2014 “Methods for
measuring the performance of domestic coffee machines”
to all coffee machines, regardless of the distribution
market. The energy label proposed in the Swiss agreement
classifies espresso machines on the basis of their energy
efficiency on a scale that goes from class D to A +++.
De’Longhi Group
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02 Report on operations 67
Consumer
relations
Consumer relations
The De’ Longhi Group’s brand reputation is rooted
in the high quality of its products and customer loy-
alty that has been built over time. Different factors
and activities contribute to promoting the Compa-
ny’s reputation, including clear communication
which anticipates and guides the purchase, a post-
sales service which is focused on the consumer, as
well as the constant commitment to privacy and
data protection. The Group, in fact, works to safe-
guard the data of its customers in accordance with
the law and is committed to mitigating the risks
associated with obsolete telecommunications and
data processing technologies. Toward this end, the
Group monitors changes in the regulatory frame-
work constantly, paying particular attention to the
Artificial Intelligence Act, a regulation proposed by
the European Union which soon could have an
impact on the extended liability of the
manufacturer.
With regard, again, to regulation, the main regula-
tions shaping the Group’s efforts to satisfy the
needs of consumers relate, specifically, to empow-
ering consumers for the green transition by work-
ing to improve protections against unfair practices
and information, product guarantees and the right
to repairs.
For more detailed information on the management
of risks linked to consumer relations, refer to the
table “The main risks linked to non-financial topics
and management methods”, specifically the item
“Consumer Relations”, in the Note on Methodology.
Business and organizational model
The De’ Longhi Group’s external communication is
managed by the Marketing and Communication Di-
vision, which coordinates both the centralized ac-
tivities and the ones at the marketing offices of the
local branches, in order to enhance the identity of
the each of the Group’s brands. each brand. The
Customer Care division is responsible for support-
ing the end consumer in the various phases of the
customer journey. Customer support is, lastly, also
guaranteed by the contact center and technical as-
sistance centers which are located in all the mar-
kets in which the Group operates. These organiza-
tions, primarily outsourced, provide a service which
is essential to customer care, working, on the one
hand, to increase customer satisfaction and, on the
other, to maximize product durability.
One of Customer Care’s main activities is to devel-
op processes which guarantee that the Group is
aligned with customer expectations. More specifi-
cally, in the last few years one of the trends that has
impacted Customer Care is the increase in e-com-
merce sales volumes. The disintermediation is, in
fact, having a significant impact on the relationship
between the Company and consumers, increasing
the number of direct sales (B2C) which, in turn, re-
quires that increasing attention be paid to the direct
relationship with customers.
Given the continuous contextual change, and in
light of the communication opportunities created
by the use of digital instruments, already in 2022
Customer Care had decided to renew its strategy
based on two key elements: on the one hand, the
involvement of stakeholders in order to understand
the different needs, on the other, the study of cus-
tomer care best practices. This resulted in the defi-
nition of guidelines for the redesign of the Group’s
strategy which was renewed in 2023.
From an operational standpoint, the Group’s main
CRM (Customer Relations Management) tool
(based on the management system – SAP C4C
(Cloud For Customer) – which makes it possible to
monitor the interactions with the final customer,
guaranteeing the quality of the service provided
and standardizing the traceability of the relations.
A control dashboard equipped with a few key pa-
rameters, developed through the use of the SAP
Analytic Cloud, compiles a vast range of data as
graphics which allows the customer care special-
ists to receive crucial information in order to contin-
uously improve the speed and the quality repairs,
which has a positive impact on the average repair
time.
Another key tool for Customer Care is Wonderflow,
the company’s VoC management (Voice of
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02 Report on operations 68
Customer) system – which, to date, is the main
means used by the Group to analyze the sentiment
of its customers and, consequently, improve its ser-
vice. More in detail, this system not only makes it
possible to examine consumers’ product reviews
submitted through the more than 70 online retail
channels, but also to cross-reference these reviews
with the feedback of customers made directly
through De’ Longhi channels. In this way, by using
Big Data Analysis, year after year the Group has
been able to improve its listening strength, and un-
derstand the needs of consumers, as well involve
all the stakeholders and monitor the performance
of products in the different markets in which it op-
erates. The precision of these analyses and the at-
tention given to them makes it possible to develop
geographic clusters and identify targets for im-
provement which increases the organizational effi-
ciency, the quality of products and service and,
consequently, customer satisfaction.
Together, SAP C4C and Wonderflow make it possi-
ble to define key monitoring indicators and develop
solutions based on objective data. The systems
also allow the Group to gather information on its
products and those of other sector companies,
through tools like text analysis, text mining, senti-
ment analysis and rating breakdown – which pro-
vide a complete and detailed vision of the many
aspects of the needs in the market where the Group
operates.
As part of its customer care services, and specifi-
cally, web self-service
22
, the Group uses a system
that leverages on artificial intelligence to quickly
provide customers with functional replies and solu-
tions. More in detail, the web self-service is able to
analyze the users’ questions and independently
formulate an exhaustive reply which provides a
solution to the problem found. Subsequently, a
group of specialists validate the AI reply and con-
tact the customer in order to guarantee efficient
and quality service. The service, already active in
English-speaking countries and in Italy, in 2023 was
expanded to include Germany, Belgium, France
and the Netherlands. This expansion was
facilitated by the implementation of sophisticated
simultaneous translation systems, which use AI to
translate the content of e-mail and web-chat that
allows the operators to reply efficiently to the cus-
tomers’ needs, regardless of their native language.
With regard to technical assistance, the Group
counts on approximately 1,800 service centers
worldwide, of which 300 in Italy. In the past few
years, despite the geopolitical and global market
difficulties, the service has demonstrated great re-
silience, maintaining high quality standards and
continuously reducing the average repair time.
This success is attributable to the significant in-
vestments made by the Company over the past few
years, like expanding the Group’s largest repair
center in Germany which now has an installed
repair capacity of about 60 thousand machines per
year, 50% higher than the previous structure.
In addition to sharing joint guidelines and stand-
ards, Customer Care constantly monitors the quali-
ty of the service provided by the contact centers
and the repair centers through inspections and
22 The web self-service is an assistance model that allows
users to access information without having to interact with
an operator. It can include tools like a FAQs (Frequently
Asked Questions) section, digital instruction manuals,
video guides, chatbots or support forums.
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02 Report on operations 69
Policies and objectives
The De’ Longhi Group’s actions are focused on the
improvement of the assistance provided to cus-
tomers and the longevity of its products. While a
specific policy has yet to be formalized, the Group’s
strategy is shaped by the objective of meeting its
customers’ needs and focused primarily on provid-
ing accurate product information and adequate af-
ter-sales care.
The Group’s Code of Ethics has an important role in
internal and external communications. Inside this
document there is, in fact, a specific section in
which the methods to be used in customer interac-
tions are described. In order to provide the highest
quality service, the Group works to guarantee that
relationships with customers are professional,
timely, attentive, open, respectful, collaborative and
passionate.
Based on the Code of Ethics the disclosures made
both inside and outside the Group must comply
with the law, regulations, as well as professional
best practices, and be clear, transparent, timely and
accurate.
Key figures
The work done by Customer Care brought an in-
crease in customer services, which are monitored
through two indicators: the First Time Fix and the
analysis of the KPI. In order to improve service
quality, specific training sessions are offered peri-
odically to employees and specialized partners,
held primarily online thanks to the availability of
e-learning platforms, but also in-person. In 2023
classroom training sessions were offered to cus-
tomer care personnel: the activities were designed
internally, in collaboration with an outside agency,
and then offered to 50 technical the periodic visits
of repair centers, interrupted due to pandemic re-
strictions, continued. Lastly, the assistane employ-
ees and to five employees responsible for the cus-
tomer care networks. The activities combined
theory with practice: in addition to a few classroom
sessions, a practical exercise was held at the
centers, where the interaction abilities and the
commercial expertise acquired were assessed.
Lastly, another important aspect of the relationship
with the consumer is data processing. This topic
has become increasingly important, in light of up-
dated regulations, as well as the quantity of the
data handled by the Group. Toward this end, for
years the Company has been storing the informa-
tion provided by consumers on Google Cloud Plat-
form servers, a platform which guarantees data
protection in compliance with data protection laws
(specifically the General Data Protection Regula-
tion – GDPR 2016/679) and the main international
standards for information security (ISO 27001) and
cloud services (ISO 27017 and ISO 27018).
23 The procedure undertaken by the Trento Chamber of Com-
merce did not result in any fines.
Turnaround Time. Testimony to the quality of the
repair service, the first came close to reaching
100% in 2023: this indicator measures the percent-
age of repaired products which – once repaired -
did not require further repairs. The second, which
measures the average time needed to address the
problems reported by the user and find a definitive
solution, dropped consistently over the last three
years.
Lastly, with regard to marketing and labeling non-
compliance, there was only one case in 2023 when
the Group was notified by the Trento Chamber of
Commerce that a customer had complained about
the lack of a safety manual inside the packaging of
an Ariete product
23
.
With the exception of the above, there were no in-
stances of noncompliance which involved con-
sumer relations, nor in relation to data processing
and protection. There were no data breaches in the
two-year period 2022-2023.
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02 Report on operations 70
Supply
chain management
Risk scenario
Preventing and managing the risks associated with
the supply chain is essential to ensuring the conti-
nuity of the Group’s business. The De’ Longhi
Group does not limit itself to simply ensuring a
timely distribution of products and highquality
parts, but is committed to making sure that its sup-
pliers adhere to the best practices for working con-
ditions, the health and safety of workers, respect of
human rights and environmental responsibility.
While 2022 was a very complex year for supply
chain management, caused, on the one hand, by
persistent restrictions linked to the pandemic and,
on the other, interruptions in a few market seg-
ments due to the outbreak of the Russian-Ukrainian
conflict, 2023 was a year of transition, character-
ized by uncertainty, but also positive results.
During the year, the global market conditions and
the unstable geopolitical context required that the
Group monitor inflation rates, foreign exchange
rates and tensions in EMEA (Europe, the Middle
East, Africa) constantly. In a year which saw a gen-
eralized increase in production volumes the Group,
however, was able to guarantee the continuity of its
supply chain and minimize its costs, thanks also to
effective inventory management and lower unit
shipping costs.
For more information on the measures used to ad-
dress and manage supply chain risks please refer
to the table “The main risks associated with non-fi-
nancial issues and management methods” in the
Note on Methodology.
Business and organizational model
Supply chain management is carried out by the
Supply Chain Division, together with Quality and
Purchasing, with a view to ensuring business conti-
nuity and compliance of the Group and its suppliers
with the highest quality standards, as well as social
and environmental requirements.
In order to respond to the specific needs of the dif-
ferent markets in which the Group operates effec-
tively and quickly, three offices are involved in mon-
itoring and supporting the providers of finished
products based on product category and proximity
to production. Consequently, the offices focused
on coffee and irons are in Italy; motor-driven prod-
ucts are managed through the UK office and, lastly,
the office in Hong Kong focuses on comfort.
In Europe, Supply Chain is responsible for manag-
ing the volumes and logistics of materials, as well
as semi-finished goods used in production; this
process is carried out through two different operat-
ing locations, located in the Italy and Romania
which work with the offices referred to above. Man-
agement of materials in the Chinese plants is su-
pervised directly by the plant directors with the
support of three purchasing offices broken down
by product category.
The Quality Division is responsible for the periodic
audits of the suppliers of finished products, in order
to assess qualitative, social and environmental per-
formance. More in detail, the audits are carried out
every two years: the audits make it possible, on the
one hand, to that the quality of the products and
materials meet the Group’s needs and, on the other
hand, to guarantee compliance with social criteria
like the protection of human rights and compliance
with the main environmental regulations.
The social audits are carried out in accordance with
the international standard SA 8000 (Social Ac-
countability) which assess aspects including free-
dom of association and collective bargaining, work
hours, work conditions, health and safety, child
labor, forced labor, discrimination and training of
personnel. The assessment criteria take into ac-
count the level of social risk associated with the
different countries; for this reason, most of the
audits are made in China as the social risk is gener-
ally higher compared to other countries where the
Group’s suppliers are located. Along with these
social criteria, there also indicators used to audit
the environmental performance which include
emissions, water and waste disposal, as well as
verification of a management system compliant
with the ISO 14001 standard.
The Code of Ethics is another tool used to monitor
the activities of suppliers. This document is shared
with all the Group’s commercial parties through a
dedicated vendor portal, where the Code’s original
text is available in English, Italian and Chinese. This
makes it possible for suppliers to fully understand
the Code, comply with obligations, adhere to the
principle and adjust its activities in order to comply
with any requests made as a result of the audits.
The same portal houses the “Responsible sourc-
ing guidelines”, which define the associated risk
criteria and determine a specific control regime for
all the Group’s vendors based on three factors: type
of provider, geopolitical area of origin and impor-
tance of the business. Thanks to the constant up-
dating of the assessment criteria, the Group is able
to carry out a complete assessment of the suppli-
er’s situation and guarantee effective monitoring of
the risks.
This entire assessment process is monitored and
formalized in a procedure based on which all sup-
pliers of finished products are subject to SCOC
(Social Accountability Code of Conduct). This pro-
cess is broken down in different phases, which
begins with gathering data and continues with re-
porting and monitoring of any corrective actions,
as well as specific follow-up. All these activities are
recorded in a specific system which makes it possi-
ble to trace the commitments made by suppliers
over time.
With the lifting of restrictive measures
De’Longhi Group
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02 Report on operations 71
implemented as a result of the Covid-19 pandemic,
the vendor audits are now done entirely in person,
in order to ensure more accurate audit outcomes,
The digital instruments are now used exclusively
for complementary activities, like receiving and
sending any follow-up which do not require on-site
verification and checking the information provided
in documents which can be done via e-mail. This
mechanism is valid for audits of historic suppliers,
as well as the more recent ones.
Product quality is assessed based on a group of
specific indicators:
1. Technical Factory Audit (TFA): measures the ef-
fectiveness of the vendor’s processes and evalu-
ates the results of tests relating to product life.
This type of audit is conducted every year and
focuses on both the initial qualification, as well
as subsequent periodic monitoring of vendors.
As mentioned above, the checklist for this type of
audit includes a section dedicated to environ-
mental issues
2. Quality Evaluation (QE): measures product
quality based on statistical sampling of each
single lot.
3. On Time Delivery (OTD): measures the delivery
time of the supplier and, more specifically, the
difference between the delivery date agreed
upon and the actual one.
4. Order Fill Rate (OFR): measures the ability of
the supplier to refill the entire quantity request-
ed by the Group.
The assessments of product quality are included in
a vendor rating which is used to classify partners
in four categories - preferred, approved, probation
and exit plan - as well as evaluate the structure and
intensity of partnerships in the future, with a view
also to continuous improvement.
Policies and objectives
The relationships between the De’ longhi Group and
its vendors are governed by the Group’s Code of
Ethics which lists the criteria which both parties
must adhere to: on the one hand, compliance with
applicable law and regulations and, on the other
hand, compliance with the general principles de-
fined in the Code. The supplier selection process,
furthermore, should be done based on an objective
comparison of quality, price, execution and assis-
tance while avoiding any and all forms of favoritism
or discrimination. The Group suppliers must
ensure that the working conditions of its employ-
ees do not violate basic human rights, comply with
international agreements and current law. In order
to extend the Group’s control across the entire
value change, and not just with its own suppliers,
the supplier must provide its sub-contractors with a
copy of the updated and translated Code of Ethics.
In addition to managing the assessment and moni-
toring of new suppliers, the Supply Chain Division
and Quality will work to establish long-term rela-
tionships. More specifically, the divisions work to
create a simplified network which favors direct de-
liveries, consistent with the Group’s expectations.
This approach allows the Group to respond not
only to market requests, which change constantly
and require flexibility, but also the needs dictated by
production.
Key figures
In 2023, all the new suppliers of finished products
were subject to a social accountability audit, in ac-
cordance with standard SA 8000 (100%). To date
none of the SCOC (Social Accountability Code of
Conduct) audits had a “zero tolerance” outcome and,
therefore, resulted in the termination of the relation-
ship with the supplier.
As for the environmental aspects, in 2023 environ-
mental audits of 15 new providers of finished prod-
ucts or 100% of the new providers, were carried out,
consistent with the prior two-year period.
In 2023 a total of 49 audits were carried out in order
to verify that no human rights violations had oc-
curred at the 45 suppliers of finished products and 4
Group assets. This covered around 44% of the
Group’s operations which, while lower than in 2022,
is consistent with the fluctuations and biannual
schedule of the audits and remains in line with 2021.
De’Longhi Group
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02 Report on operations 72
Number and percentage of transactions
subject to human rights assessments
New suppliers of finished products subject to
social accountability and environmental audits
Total number of operations that have been subject to human rights reviews
Total number of operations
Percentage of operations that have been subjected to human rights reviews
2021
2022
2023
46
60
109
95
42.2%
63.2%
43.8%
49
112
Number of new suppliers
Number of suppliers audited
Percentage of new suppliers audited out of total
2021
2022
2023
14
6
14
6
100.0%
100.0%
100.0%
15
15
De’Longhi Group
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02 Report on operations 73
Mitigation
of environmental impact
Risk scenario
The De’ Longhi Group, which operates daily in an
international environment of continuous change,
pays constant attention to the proper management
of its manufacturing processes, consistent with the
relative legal requirements. Consistent, further-
more, with the constant changes in the regulatory
and market backdrop, the Group’s environmental
policies, which are crucial to responsible business
management and reducing its impact, are updated
regularly.
For more information about environmental risks, as
well as the Group’s risk management, please refer
to the section “Risk factors for the De’Longhi
Group”, specifically paragraphs 15 (Risks relating to
changes in the regulatory framework) and 16
(Risks relating to environmental harm) in the sec-
tion “Risk factors for the De’Longhi Group”.
For more information on the measures used to pre-
vent and manage environmental risks please refer
to the table “The main risks associated with non-fi-
nancial issues and management methods” in the
Note on Methodology.
Business and organizational model
At a Group level, the environmental aspects are
managed by the Operations & Technology and
Quality Divisions. Toward this end, over the last few
years, the De’ Longhi Group has worked to obtain, in
2022, ISO 14001:2015 certification for all the envi-
ronmental management systems in place at the
production facilities. This certification ensures the
presence of a system capable monitoring the envi-
ronmental impact of the activities, as well as imple-
ment improvements and mitigation. Over the years
the Group has made multiple investments in,
among other things, the production of clean energy,
more modern and more efficient plants and optimi-
zation of the manufacturing processes.
As for the production of electricity from renewable
sources, a number of years ago the Group installed
solar panels at the Mignagola plant which in 2023
produced 862,318 kWh of energy, part of which
was sold to the electric grid – thus contributing to
the reduction of the domestic energy mix. The on-
site production satisfies about 6% of the electricity
needs and reduces the dependence on the national
grid. The installation of solar panels was also ex-
tended to a few commercial branches and prepara-
tion for the installation of a solar energy system at
the Cluj plant in Romania was begun recently. With
an installed capacity of around 3 MW, the system
will cover a sizeable portion of the site’s energy
needs and will be the Group’s largest solar energy
system. In the current reporting year, a total of
882.058 kWh of renewable energy were produced
and consumed.
With a view to improving energy efficiency, move-
ment sensors were also installed at the Mignagola,
Cluj, Salonta and Dongguan plants; as a result of
these sensors lights are activated only when move-
ment is detected. At the same plants and the Trevi-
so headquarters, meters which monitor consump-
tion and energy efficiency were installed. At the
same time, in order to optimize consumption, LED
relamping is underway: if in the last few years
relamping was carried out mainly at the European
plants, in 2022-2023 significant progress was
made also at the Chinese sites where currently only
energy efficient lightbulbs are being used. More
specifically, in 2023, thanks to the installation of
more than 1,500 LED lamps it was possible to
lower consumption by 1,759,241 MJ, in the Dong-
guan site alone
24
.
Beginning in 2021 at the Dongguan plant another
efficiency initiative was launched aimed at replac-
ing traditional hydraulic injection plastic molding
machines with new machines that rely an electric
servomotor capable of maintaining high produc-
tion levels, with less energy consumption. In 2023
this substitution resulted in energy savings of
3,801,600 MJ
25
.
At the Mignagola plant the analysis and planning of
a new product testing process for coffee machines,
based on air tests continued. Not only would this
innovation make it possible to save around ½ a liter
of water per test, but it would be possible to reduce
the amount of time and energy needed.
Another division which makes a crucial contribu-
tion to reducing environmental impact is Research
and Development which is involved in the design of
eco-sustainable products beginning with the
choice of materials, as well as packaging, through
obsolescence. More in detail, R&D uses a scientific
approach both locally and on a corporate level to
design and develop solutions which increase the
energy efficiency, durability and repairability of the
products, as well as reduce the consumption of
24 The estimated reduction in consumption was made in
comparison to 2021.
25 The estimated reduction in consumption was made in
comparison to 2021.
De’Longhi Group
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02 Report on operations 74
resources and production of waste generated by
company operations. Please refer to the section
“Product innovation and quality” for more
information.
In regard to the last topic, the Group developed sev-
eral strategies for the responsible management of
the waste generated during production which aim
to be more aligned with the circular economy con-
cept. At the Mignagola and Dongguan plants,
therefore, projects were implemented which call for
the recovery of plastic scraps that are then reused
in the manufacturing cycle which reduces waste.
Starting in the second half of 2022, a similar initia-
tive was begun at the plants in Cluj and Salonta,
where in 2023 100% of the waste generated by the
plastic molds was recycled.
More efficient waste management is not limited to
plastic: waste generated by work done with metal
was resold as a raw material, while paper, card-
board and nylon scraps are sent to be regenerated.
The use of this method will, in fact, make it possible
to save a whopping 150 tons of coffee per year.
Careful management of purchased goods also and,
above all, involved coffee. Toward this end, initia-
tives are being worked on to minimize consump-
tion and recycle any waste. More specifically, at the
Mignagola plant, adjustments to the calibration of
the coffee grinder during coffee testing was tested:
this initiative, once completed, will result in a saving
of more than 150 tons of coffee a year and lower
energy consumption by around 80%, without com-
promising the quality of the process.
Responsible waste management is also expressed
through the special attention given to recycling, at
both the offices and the production facilities: spe-
cial signage and targeted training focused on how
to correctly dispose of waste aims to increase the
quality of the recycling system. In 2023 specific
training was offered at the Dongguan plant, while at
OnShiu an initiative to reduce hazardous waste,
through the installation of new pressurized filters,
was implemented.
The use of sustainable packaging is another area
to which the Company is committed. Beginning in
2020 LCAs (Life Cycle Assessment) of the different
types of packaging used were carried out in in order
to find more environmentally friendly alternatives.
Based on the results obtained, the Group decided
to focus on reducing the quantity of EPS (Expanded
Polystyrene) used in product packaging. In the last
few years, the percentage of EPS-free packaging
has increased constantly: in 2023, 69% of the prod-
ucts distributed by the Group were without EPS, an
improvement of more than ten percentage points
compared to the prior year.
The packaging efficiency initiatives also involved
the Group’s internal logistics and operations: at the
Chinese plants and the one in Cluj the goal is to
reuse the plastic and cardboard packaging of the
components delivered which are otherwise dis-
posed of upon arrival. More specifically, in 2023 at
the Romanian plants some plastic wraps used for
packaging were substituted with reusable Polyeth-
ylene (PET) tapes which led to a reduction in plastic
waste of approximately 5 tons.
Aware of how important reducing the environmen-
tal impact along the entire supply chain is, the
Group started implementing initiatives to reuse
packaging which also involves suppliers. In 2023 at
the Dongguan plant, where the majority of the prod-
ucts purchased end up, a project was launched in
collaboration with the main suppliers which, in
2024, will result in the use of reusable returnable
plastic boxes.
In the last few years wooden pallets have been re-
placed with pallets made out of recycled plastic,
which are lighter and more durable, at the Mignago-
la, Dongguan, OnShiu plants and, to a large degree
at the Cluj and Salonta facilities.
In order to improve air quality, systems which mon-
itor the emission of pollutants from chimneys were
installed at the Cluj, Salonta, Mignagola plants and,
beginning in 2023, also at Dongguan. These sys-
tems make it possible to measure the quantity of
harmful substances in the air with a view to both
monitoring and reduction.
Policies and objectives
Currently the Group does not have a formalized en-
vironmental policy, although the Code of Ethics,
which is applied to all the De’ Longhi companies,
states clearly that all activities are shaped by the
need for environmental protection and public
safety in accordance with the law. This principle
results in the development of projects and process-
es which are implemented in accordance with
scientific literature and environmental best practic-
es in order to prevent pollution, respect the com-
munity and protect the environment, as well as the
landscape. In this way the Group, while pursuing its
objectives for product, financial and social develop-
ment, works to find a balance between economic
initiatives and environmental needs, including and
above all with respect to future generations.
Within this framework, for each of the Group’s
plants, the requisites for the ISO 14001:2015 certi-
fications , the environmental policies in effect and
the related procedures not only ensure compliance
with the current regulations, but also the commit-
ment to improvement in the different environmen-
tal aspects including: optimization of water and
energy consumption, the reduction or, where possi-
ble, the elimination of any kind of pollution and the
implementation of technologies and processes to
minimize environmental risks.
Key figures
Nel 2023, the increase in production volumes re-
sulted in higher energy consumption which
amounted to 437,701 GJ (+18% compared to the
prior year).
The Group’s consumption can be divided in direct
and indirect: the first is explained above all by the
use of the tri-generator at Mignagola, the corporate
fleet, the natural gas used for heating and produc-
tion; the second ones are connected largely to con-
sumption of electricity for production, lighting and
De’Longhi Group
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02 Report on operations 75
district heating and air conditioning. The direct
consumption represents 37% of the total, higher
than in the prior year (+41%) due primarily to the in-
crease in the consumption of natural gas used to
run the tri-generator at the Mignagola plant which
accounts for almost 80% of the Group’s total natu-
ral gas consumption. This system produces a
power that can be used for heat, cooling and elec-
tricity by lowering the dispersion during the trans-
port phase and is more efficient than the traditional
gas heating system supported by an electrical
system that is supplied through the national grid.
The electricity consumption per unit of production
was lower, coming in at 5.8 kWh/unit of production.
Energy consumption U.M.
Production facilities Other types of offices
26
De’ Longhi Group
2021 2022 2023 2021 2022 2023 2021 2022 2023
Direct energy consumption from non-renewable sources
Gasoline GJ 3,948 4,945 3,015 7,181 8,883 12,253 11,129 13,828 15,268
Diesel GJ 6,991 5,696 6,063 18,274 18,759 18,008 25,265 24,455 24,071
Natural gas GJ 42,869 66,777 114,228 5,115 5,934 3,932 47,984 72,711 118,160
LPG GJ 518 347 304 712 707 607 1,231 1,054 911
Fuel oil GJ - - - 61 1 - 61 1 -
Total GJ 54,327 77,765 123,610 31,343 34,284 34,800 85,670 112,049 158,410
Direct energy consumption from renewable sources
Energy produced from
renewable sources and
consumed
GJ 3,423 3,338 3,104 - - 69 3,423 3,338 3,173
Total direct consumption GJ 57,750 81,103 3,104 31,343 34,284 69 89,093 115,387 3,173
Indirect consumption
Electricity purchased GJ 296,557 218,380 240,890 34,291 35,398 33,812 330,848 253,778 274,702
District heating GJ - - - 2,322 2,599 1,059 2,322 2,599 1,059
Cooling GJ - - - - 367 358 - 367 358
Total indirect consumption GJ 296,557 218,380 240,890 36,613 38,364 35,229 333,170 256,744 276,119
Total consumption GJ 354,307 299,483 367,604 67,956 72,648 70,098 422,263 372,130 437,702
Products plants (GJ)
Other types of offices (GJ)
Energy consuption (KWh/units produced)
2021
2022
2023
354,307
299,483
67,957
72,648
5.3
6.7
5.8
26 “Other types of offices” includes the offices, distribution
branches, warehouses and, in general, all of the De’ Longhi
Group’s structures not related to production.
367,604
70,098
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02 Report on operations 76
In 2023 total Scope 1 and Scope 2 CO2 emissions
(calculated using the “Location Based” method)
reached 42,863 tons, 24% higher than in 2022 and
consistent with the increase in production. The
direct emissions account for 12% of the Group’s
total, while the indirect location based emissions
account for around 88%. More in detail, if the first
are generated mainly by the corporate car fleet
(57% of the Scope 1 emissions), the second ones
are explained primarily by the consumption of elec-
tricity (86% of the Scope 2 location based emis-
sions)
27
and the tri-generator at Mignagola (14%).
Lastly, in 2023 the indirect market-based emissions
were 55% lower than in the prior year and 64%
lower than in 2021. This trend is attributable mainly
to the increase in the purchase of guarantee of
origin (GO) certificates which guarantee that the
electricity consumed comes from renewable
sources and which today covers the consumption
at all the production plants, as well as at the com-
mercial branches located in the United Kingdom
and Ireland or 89% of the Group’s total electricity
consumption.
Emissions [ton CO
2
]
Production facilities Other types of offices
28
De’ Longhi Group
2021 2022 2023 2021 2022 2023 2021 2022 2023
Direct 3,249 3,067 2,166 2,215 2,416 2,947 5,464 5,483 5,113
Indirect - Location Based 35,523 25,544 34,376 3,460 3,608 3,374 38,983 29,152 37,750
Indirect - Market based 23,452 16,417 5,128 1,974 4,259 4,133 25,426 20,496 9,261
TOT (Direct + Indirect + Location Based) 38,772 28,611 36,542 5,675 6,024 6,321 44,447 34,635 42,863
TOT (Direct + Indirect + Market Based) 26,701 19,484 7,294 4,189 6,675 7,080 30,890 25,979 14,374
27 As of 2023, the Scope 1 calculation includes the loss of re-
frigerants, used at both the production plants and in the
branches, which produced 606.5 tons of CO
2eq
.
28 “Other types of offices” includes the offices, distribution
branches, warehouses and, in general, all of the De’ Longhi
Group’s structures not related to production.
Production plants (tons CO
2
)
Other types of offices (tons CO
2
)
2021
2022
2023
35,523
25,544
3,460
3,608
34,376
3,374
De’Longhi Group
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02 Report on operations 77
In 2023, 12,345 tons of waste were produced, an
increase of 33% compared to 2022 and is explained
by the increase in production, while the breakdown
between non-hazardous (98%) and hazardous
waste (2%) was unchanged. The percentage of
the waste which was recycled, regenerated and/or
reached 89% of the total, slightly higher than in the
prior year which testifies to the Group’s increasingly
concrete commitment to the adoption of sustaina-
ble circular economic practices.
Waste produced
29
U.M.
2021 2022 2023
Hazardous Non-hazardous Hazardous Non-hazardous Hazardous Non-hazardous
Reuse ton 1 - 1 - - 220
Recovery ton 21 2,396 19 2,055 34 1,907
Recycling ton 10 8,572 35 5,989 18 8,859
Composting ton - 198 - 50 - 18
Incineration (with energy recovery) ton 33 904 46 500 54 428
Incineration ton 48 - 28 18 82 -
Land fill ton 67 215 11 190 2 406
Storage ton 51 23 7 14 - -
Other ton 59 71 44 289 36 281
Total ton 290 12,379 190 9,104 226 12,119
Non-hazardous waste
Hazardous waste
2021
2022
2023
12,379
9,104
290
190
Waste produced at the production plants
in three-year reporting period (tons)
29 78% of waste produced in 2023 by De’ Longhi Group was
treated off-site.
12,119
226
De’Longhi Group
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02 Report on operations 78
Reuse
Recovery
Recycling
Composting
Incineration
(including energy recovery)
Incineration
Landfill
Storage
Other
Hazardous waste produced in 2023 broken down by disposal method Non-hazardous waste produced in 2023 broken down by disposal method
15.3%
8.1%
23.7%36.1%
0.8%
16.0%
Reuse
Recovery
Recycling
Composting
Incineration
(including energy recovery)
Incineration
Landfill
Storage
Other
15.7%
73.1%
0.2%
3.5%
3.3%
2.3%
1.8%
De’Longhi Group
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02 Report on operations 79
Note on Methodology
Definition of the material topics
The materiality analysis guides De’ Longhi in the
choice of the topics to report on in order to provide a
complete and clear picture as to the economic, envi-
ronmental and social impact of the Group’s activities.
In 2022, the materiality analysis was updated in order
to comply with the new GRI Standards 2021; this
analysis was confirmed in 2023.
The company’s material topics are identified, in ac-
cordance with the Standard, based on the impacts,
current and potential, that the organization’s business
and commercial relationships could have on the
economy, the environment and people, including on
human rights. This includes negative and positive im-
pacts, short-term and long-term, intentional and vol-
untary, reversible and irreversible.
The Group’s material analysis was carried out in four
different phases:
1. Understanding of the Group’s operating environ-
ment: an analysis of different documents was
carried out using different sources, both internal
and external, including documents published by
a panel of companies active in similar sectors,
sector trends identified by consulting the publi-
cations of the main international trade associa-
tions and organizations, and newspaper articles
relating to important events that affected the
company during the year.
2. Identification of De’ Longhi’s current and potential
impacts: during this phase the organization identi-
fied the current and potential impacts that its ac-
tivities and business relationships could have on
the economy, the environment and people, includ-
ing the human rights of the latter. The current im-
pacts are those happening now or have material-
ized over time while potential impacts are those
that could materialize in the future.
3. Assessment of the significance and relevance
of the impacts: all the impacts were assessed
by evaluating the degree of significance deter-
mined based on the Standard’s criteria.
4. Prioritization of the most significant impacts for
reporting purposes: the Group’s most significant
impacts were prioritized and the most relevant
impacts informed the identification of the material
topics included in this Non-Financial Statement.
The Group also assessed and classified its impacts
based on two parameters, severity and probability.
The severity of a real or potential impact is deter-
mined by its scale (how serious is the impact), the
scope (the breadth of the impact) and the irremedi-
able characteristics (how difficult it is to mitigate or
remedy the damage caused). The probability can
be defined as the likelihood that the impact will ma-
terialize, taking into account the preventive actions
adopted by company. The impacts that the De’
Longhi Group might have caused were classified
based on their severity and probability, namely
based on their significance. As a result of the anal-
yses, the Group approved a list of 13 material
topics: three relating to the environment, two to
governance and eight to social aspects. Lastly,
after having identified the significant impacts and
defined the material topics, the GRI associated with
the impact to be reported on were identified.
The list of the material topics determined after the
identification and grouping of the relevant impacts
is provided below. The Topic-Specific GRI Disclo-
sures for each material topic are also provided.
Reporting scope and standards used
In accordance with the Decree, the reporting scope
corresponds with the scope of consolidation used
in the consolidated financial statements, namely
the continuing operations fully consolidated using
the line-by-line method in the financial reports,
unless provided otherwise.
In 2023 a new company, “De’ Longhi LLP”, with reg-
istered offices in Kazakhstan, was added to the
scope of consolidation. The date of inclusion in the
scope of consolidation coincides with what was
determined for the financial figures.
The information and figures used in this section
refer to FY 2023.
The Group used the “with reference” option of the
GRI Sustainability Reporting Standards (hereinafter
the GRI Standards), published by the GRI – Global
Reporting Initiative, to prepare its NFS. More in
detail, when preparing the NFS, reference was
made to the Standard GRI 1: Foundation, the report-
ing principles and the GRI content index.
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02 Report on operations 80
Legislative
Decree 254
Material topics Impacts GRI Topic-Specific Disclosure
Environmental
aspects
Management of the GHG emissions
and fight against climate change
The use of fossil fuels and electricity generates direct and indirect Greenhouse gases which contribute to climate
change. In order to mitigate and offset any impacts, the Group works to implement solutions which will help to save
energy and encourage the use of energy from renewable sources.
GRI 302-1, 302,2
GRI 305-1, 305-2
Human resources
management
Inclusion and equal opportunities
An inadequate management of the aspects relating to inclusion and equal opportunities could lead to episodes of
discrimination. Through policies, procedures and initiatives coordinated with HR, the Group works to reduce the risk of
these episodes.
GRI 405-1
GRI 406-1
Environmental
aspects
Waste management and circular
economy
The use of non-recyclable materials and inadequate management of the manufacturing waste could have a negative
impact on the eco-system. In order to mitigate the impact, the Group adopts avantgarde waste management practices,
fully compliant with the laws in effect.
GRI 306-3, 306-4, 306-5
Human resources
management
Health and safety of workers
The health and safety of workers is a top priority for the Group. In order to avoid any potential risks stemming from
production, the company adopts specific management practices to manage health and safety on the job and is
committed to ongoing monitoring and improvements.
GRI 403-9
Human rights Respect of human rights
The Group is committed to protecting human rights. In order to lessen the likelihood of a violation, relative to both
operations and along the value chain, De’ Longhi has implemented specific initiatives aimed at monitoring the practices
of its suppliers. The Group also provides training courses in topics and procedures relating to the respect of human
rights.
Non GRI KPI: transactions
assessed with respect to
human rights
Social aspects Promotion of sustainable lifestyles
Aware of its role as an influencer with its customers and stakeholders, the Group promotes the adoption of healthy
lifestyles, the use of sustainable food products and good practices for a healthy and balanced diet.
-
Social and
environmental
aspects
Responsible supply chain
management
Irresponsible management of the supply chain could have a negative social and environmental impact. The De’ Longhi
Group has, therefore, adopted tools and mechanisms which reduce the risk that the impact materializes.
GRI 414-1
GRI 308-1
Environmental
aspects
Innovation and eco-design
The irresponsible use of materials, including the during the procurement phase, could damage the eco-system. For this
reason, the Group has defined guidelines in order to promote innovative and sustainable solutions in the choice of
materials.
-
Social aspects Product safety and labeling
Labeling which is not transparent and complete could cause products to be used incorrectly and compromise consumer
safety. At the same time, failure to monitor quality during procurement and production could have repercussions. The
Group, therefore, works to guarantee constant quality and product safety controls, as well as transparency in labeling.
GRI 417-2
GRI 417-3
GRI 416-1
Social aspects Consumer satisfaction
For De’ Longhi consumer satisfaction is of the utmost importance. For this reason, it promotes surveys relating to
consumer needs and preferences order to establish loyalty and a lasting relationship.
-
Fight against
corruption
Ethics and business integrity
De’ Longhi is committed to conducting its business in accordance with principles of integrity, transparency, legality,
fairness, prudence and in compliance with the law.
GRI 205-2 (b, c, e)
205-3
Human resources
management
Talent acquisition and retention
In addition to the employee satisfaction, a key aspect for the Group is talent development by investing constantly in
human resources which guarantees stability, appeal and the creation of jobs.
GRI 404-1
Social aspects Use of consumer data
By promoting campaigns to heighten awareness as to the risks stemming from the use of personal data, the Group
works to guarantee the protection of consumer privacy.
GRI 418-1
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02 Report on operations 81
The main risks associated with non-fi-
nancial issues and management methods
The possible risks, inflicted and caused, associated
with the issues identified by the De’ Longhi Group as
“material” are reported in the following table, as well
as the main risks associated with and the relative
management of each Legislative Decree 254 area.
Legislative
Decree 254
Main risks Risk management tools
Fight against
corruption
• Risks connected to administrative liability of legal entities, particularly with regard to Legislative
Decree 231/2001 which introduced specific rules relating to liability for a few types of crimes to
the Italian legal system
• Risks tied to the Group’s current or past commercial relationships with related parties
• Reputational risk
• Group Code of Ethics
• Model of organization, management and control pursuant to Legislative Decree 231/2001
• Group’s internal control and compliance system
• Corporate Governance guidelines
• Procedure for Related Party Transactions
Human
resources
management
Human rights
• Risks connected to human resources management, particularly with regard to the Group’s abili-
ty to recruit, develop, motivate, retain and promote personnel with the attitudes, values, special-
ized professional and/or managerial skills needed to meet the Group’s changing needs.
• With regard to the Chinese platform, there are also a few risks related to high turnover of Chi-
nese blue-collar workers
• Risks tied to possible instances of discrimination
• Group Code of Ethics
• Model of organization, management and control pursuant to Legislative Decree 231/2001
• Group’s internal control and compliance system
• OHSAS 18001 compliant organizational model
• Worker safety and health policy in place at European plants
• Compensation policy for the BoD and executives with strategic responsibilities
• Performance review process
• MBO procedure
• Employee surveys
• For the Chinese plants: incentive schemes to foster staff retention, investment in training and
the development of more qualified internal resources, improvements in living and working condi-
tions inside the different plants
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02 Report on operations 82
Legislative
Decree 254
Main risks Risk management tools
Social
aspects
Environmen-
tal aspects
Product quality and innovation
• Risks connected to the De’ Longhi Group’s to continue with product innovation
• Risks associated with patents and trademarks
• Risks connected to product quality and liability for violations of the quality standards applied in
the different jurisdictions where the Group
• Risks connected with regulatory changes, relating in particular to environmental protection, es-
pecially the regulations relating to the safety and energy efficiency of electric household appli-
ances, recyclability and environmental friendliness.
• Group Code of Ethics
• UNI EN ISO 9001:2015 certified Quality System
• Food safety management model
• Quality policy
• NPD procedures
• Quality audits
• Constant monitoring of regulatory changes
• Registration of product patents and trademarks
Social
aspects
Consumer relations
• Risks associated with warehouse size and the timeliness of deliveries; more in detail, in the
event the Group doesn’t have an adequate quantity of products it could run the risk of not being
able to meet customer demand in a timely manner. Another risk stems from potential supply
chain issues which could impact the adequacy of the service provided
• Risks relating to IT systems: in relation to events which could compromise service continuity
and integrity of the data
• Group Code of Ethics
• Model of organization, management and control pursuant to Legislative Decree 231/2001
• Group’s internal control and compliance system
• GDPR policy (includes policy for the storage of data and procedure for the management of data
breaches)
• Training of employees in IT safety and privacy
• Presence of structures dedicated to monitoring the level of customer satisfaction
Social
aspects
Human rights
Supply chain management
• Risks connected to supplier relationships with regard, in particular, to reliable product quality,
logistics and timely deliveries, as well as relationships with company employees
• Risk of being dependent on a single supplier for certain types of components for strategic
products
• Group Code of Ethics
• Model of organization, management and control pursuant to Legislative Decree 231/2001
• Procedure for Related Party Transactions
• Social accountability audits
Environmen-
tal aspects
• Risks relating to environmental harm: the manufacturing done by the Group at its plants and fa-
cilities could harm third parties, cause accidents or environmental harm if serious breakdowns
or malfunctions were to occur
• Risks connected to climate change: extreme weather conditions (like floods, high levels of pre-
cipitation, hurricanes) could undermine the Group’s ability to operate
• Risks connected to inappropriate energy management practices: poor sustainability practices
in energy management could make it more difficult to reduce the energy footprint and/o accel-
erate climate change
• Group Code of Ethics
• UNI EN ISO 14001:2015 certified environmental management system for the European plants
• Group’s internal control and compliance system
• Environmental policy applicable also the production facilities in Mignagola and Cluj, as well as
the Kenwood plant.
• With regard to climate change risks, in the two-year period 2021-2022 the Group adhered to
management principles and methods inherent in the UNI EN ISO 14001:2015 environmental
management system. Furthermore, in the two-year period 2021-2022 the perceived risk stem-
ming from the possible impact that climate change could have on the business was mapped.
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02 Report on operations 83
The reporting process and the meth-
ods of calculation used
The content used in the NFS 2023 was prepared by
all the relevant company divisions and those re-
sponsible for the aspects referred to in the report.
The main methods of calculation used, and the rel-
ative updates, are listed below:
• for GRI Disclosure 403 (Occupational Health and
Safety) includes the number of injuries recorded
during travel on transportation organized by
De’Longhi and, therefore, excludes the other
instances;
• injury rate is the total number of injuries ex-
pressed as a percentage of the total number of
labor hours multiplied by 1,000,000, excluding
commuting accidents;
• severity rate is the total number of serious acci-
dents (which resulted in an absence of more
than 6 months) expressed as a percentage of
the total number of labor hours multiplied by
1,000,000;
• the first-time quality (FTQ) indicator is the
number of products without functional or esthet-
ic defects as a percentage of total production for
the year;
• the service call rate (SCR) is the number of ma-
chines repaired in the first year under warranty
as a percentage of total yearly sales. This indica-
tor is calculated quarterly on a rolling 12-month
basis;
• the first-time fix (FTF) indicator is the number of
repaired products that did not need further re-
pairs in the six months following completion of
the initial repair as a percentage of total product
repairs;
• greenhouse gas emissions are calculated
based on international guidelines and standards
“European Residual Mixes”, published by ABI for
the years 2020-2022, were used. For the United
States an average residual mix per eGrid Subre-
gion, calculated based on the residual mixes
shown in the document 2020 Green-e Residual
Mix Emissions Rates for 2021; for 2022 and
2023 a more updated version of the Green-e®
Residual Mix Emission Rates which contains
data for 2022 and 2023 was used. As for the
countries for which no residual mix figures were
available, location-based emissions factors
found in the above mentioned Terna table were
used.
District heating emissions were calculated using
the emissions factors found in the document “UK
Government GHG Conversion Factors for Company
Reporting” published by the Department for Envi-
ronment Food & Rural Affairs (DEFRA) table for the
three-year period 2021-2022-2023.
such as GHG protocol and ISO 14064-1:2018.
The only greenhouse gas considered was
carbon monoxide (CO
2
). The self-produced
energy from renewable sources was excluded
from the calculation of greenhouse gas emis-
sions as it is considered to be free of greenhouse
gas emissions.
The emission factors used to calculate CO
2
emis-
sions were determined as follows:
• Direct emissions (Scope 1): the emissions
linked to the consumption of natural gas, diesel
heating fuel, gasoline, diesel fuel and LPG for the
company cars were determined based on the
emission factors reported in the table of national
standards published by the Italian Ministry of the
Environment, for the years 2021, 2022 and 2023.
The emissions linked to refrigerants were calcu-
lated using the Global Warming Potential (GWP)
found in the Sixth Assessment Report of the In-
tergovernmental Panel on Climate Change
(IPCC).
• Indirect emissions (Scope 2): indirect emis-
sions are linked to the consumption of electricity
and district heating; the emissions linked to elec-
tricity were calculated based on a location and
market-based approach. Location based emis-
sions were calculated by taking into account, for
each country, the factors referred to in the most
recent version of Table 49 – Primary socio-eco-
nomic and energy indicators published by Terna
(Italian grid operator), in the International Com-
parison section, based on the most recent Ener-
data data, namely the 2019 version. In the event
a country was not listed in the above table, we
used the emission factor for the continent.
When there were several branches in several
countries, the highest of the emissions factors
among these countries was used.
• With regard to the market- based emissions,
when available, the residual mixes found in the
De’Longhi Group
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02 Report on operations 84
GRI Content Index
Statement of use
The De’ Longhi S.p.A. Group reported the following disclosures in the GRI Content Index for the reporting period 01/01/2023 - 31/12/2023, using the GRI
Standard method “with reference to”
GRI 1 used GRI 1: Foundation 2021
GRI Standard Disclosures Location
GRI 2: General disclosures
2-1 Organizational details 42-43
2-2 Entities included in the organization’s sustainability reporting 42-43
2-3 Reporting period, frequency and contact point 84
2-4 Restatements of information (*)
2-5 External assurance 156
2-6 Activities, value chain and other business relationships 42-43
2-7 Employees 60
2-8 Workers who are not employees 60
2-9 Structure and composition of the governance 61
2-29 Approach to stakeholder engagement 44
GRI 3: Material Topics 2021
3-1 Process to determine material topics 79-80
3-2 List of material topics 79-80
3-3 Management of material topics 79-80
Ethics and business integrity
GRI 3: Material Topics 2021 3-3 Management of material topics 79-80
GRI 205: Anticorruption 2016
205-2 Communication and training relative to anticorruption laws and procedures 55
205-3 Confirmed incidents of corruption and actions taken 54
Management of GHG emissions and the fight against climate change
GRI 3: Material Topics 2021 3-3 Management of material topics 79-80
GRI 302: Energy 2016
302-1 Energy consumption inside the organization 75
302-3 Energy intensity 75
GRI 305: Emissions 2016
305-1 Direct greenhouse gas (GHG) emissions (Scope 1) 76
305-2 Indirect GHG emissions from the consumption of energy (Scope 2) 76
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02 Report on operations 85
GRI Standard Disclosures Location
Waste management and circular economy
GRI 3: Material Topics 2021 3-3 Management of material topics 79-80
GRI 306: Waste 2020
306-3 Waste generated 77-78
306-4 Waste diverted from disposal 77-78
306-5 Waste directed to disposal 77-78
Responsible supply chain management
GRI 3: Material Topics 2021 3-3 Management of material topics 79-80
GRI 308: Environmental assessment of suppliers 2016 308-1 New suppliers screened using environmental criteria 72
GRI 414: Social assessment of suppliers 2016 414-1 New suppliers screened using social criteria 72
Worker health and safety
GRI 3: Material Topics 2021 3-3 Management of material topics 78-79
GRI 403: Occupational health and safety 2018 403-9 Work related injuries 62-63
Talent attraction and development
GRI 3: Material Topics 2021 3-3 Management of material topics 78-79
GRI 404: Training and education 2016 404-1 Average number of training hours per year per employee 57, 61
Inclusion and equal opportunities
GRI 3: Material Topics 2021 3-3 Management of material topics 78-79
GRI 405: Diversity and equal opportunity 2016 405-1 Diversity of governance bodies and employees 61
GRI 406: Non discrimination 2016 406-1 Incidents of discrimination and corrective actions taken 55
Product safety and labeling
GRI 3: Material Topics 2021 3-3 Management of material topics 78-79
GRI 416: Customer health and safety 2016 416-1 Assessment of the health and safety impacts of products and service categories 64
GRI 417: Marketing and labeling 2016
417-2 Incidents of non- compliance involving labeling, as well as product and services disclosures 66
417-3 Incidents of non-compliance concerning marketing communications 69
Use of consumer data
GRI 3: Material Topics 2021 3-3 Management of material topics 78-79
GRI 418: Customer privacy 2016 418-1 Substantiated complaints regarding violations of customer privacy and loss of their data 69
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02 Report on operations 86
GRI Standard Disclosures Location
Non-GRI Material Topics
Respect of human rights
GRI 3: Material Topics 2021 3-3 Management of material topics 70-71, 78-80
Innovation and eco-design
GRI 3: Material Topics 2021 3-3 Management of material topics 74-75, 79-80
Promotion of sustainable lifestyles
GRI 3: Material Topics 2021 3-3 Management of material topics 66, 79-80
Consumer satisfaction
GRI 3: Material Topics 2021 3-3 Management of material topics 6-69, 80
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02 Report on operations 87
Subsequent events
After 31 December 2023 through the date on which
this annual report was approved, no events oc-
curred that would have had a significant impact on
the financial and economic results recorded, as per
IAS 10 - Events after the reporting period.
On 27 February 2024 the Group finalized the agree-
ments for a business combination between Ever-
sys (a leading company in the production and dis-
tribution of automatic coffee machines) and La
Marzocco (a leading company in the production
and distribution of semi-automatic coffee ma-
chines and coffee grinders).
With this transaction, La Marzocco and Eversys will
be able to create synergies and cross-selling oppor-
tunities, to further strengthen their position along the
entire value chain, from research and engineering to
production and market development, while creating
a global player able to effectively compete in a lead-
ership position in different market segments, such
as automatic machines, traditional machines and
luxury household, offering a variety and complemen-
tary of products, technologies and brands.
The deal is in line with the Group’s strategic guide-
lines, which see the further consolidation of its
leadership in the world of coffee and the expansion
of its presence in the professional channel.
The transaction can be classified as a “transaction
between related parties of greater importance”, due
to the fact that De’ Longhi S.p.A. and La Marzocco
International LLC are subject to the common con-
trol of De Longhi Industrial S.A..
As such, the transaction received the prior favora-
ble opinion of the Indipendent Committee, respon-
sible for transactions with related parties of greater
importance and the unanimous vote of the Board
of Directors of De’ Longhi S.p.A., with the absten-
tion of the President Giuseppe de’ Longhi and the
Directors Fabio de’ Longhi and Silvia de’ Longhi, in
compliance with the provisions of the legislation
and regulations regarding related parties.
The transaction involved the creation of a new cor-
porate structure controlled by De’ Longhi S.p.A.,
with the related contribution of Eversys, the acqui-
sition by De’ Longhi S.p.A. of shares (directly and/or
indirectly held) of La Marzocco International LLC
from De Longhi Industrial S.A. and from minority
shareholders, for approximately 41.2% of the share
capital. The remaining shares of La Marzocco were
also contributed to the new corporate structure by
the shareholders.
Due to the finalization on 27 February 2024 of the
transaction on the basis of preliminary results for
Eversys and La Marzocco, while still being audited,
De’ Longhi Group owns approximately 61.6% of the
new entity, alongside minority stakes held by De
Longhi Industrial S.A. (26.5% approximately) and the
previous minority shareholders of La Marzocco
(12%). The total net cash disbursement by De’
Longhi Group was approximately US$373 million, in-
cluding US$ 200 million in favour of De Longhi In-
dustrial S.A. (for the 22% share of La Marzocco) and
US$ 173 million for the purchase of shares from La
Marzocco’s minority shareholders (for the 19.1%
share of La Marzocco).
This amount was entirely covered by the own re-
sources of De’ Longhi Group.
The transaction did not have any impact on the De’
Longhi Group’s consolidated results reported in the
present Annual financial report, except for some
consulting and advisory costs related to the
combination.
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02 Report on operations 88
Outlook
The Group’s recent improvement in growth and
profitability dynamics leads us to foresee a revenue
growth in 2024, which includes the perimeter ex-
pansion with the business combination between
La Marzocco and Eversys. In terms of margins, it is
expected an improvement of the EBITDA before
non recurring items for the new perimeter.
Treviso, 12 March 2024
For the Board of Directors
Vice President and Chief Executive Officer
Fabio de’Longhi
Consolidated financial statements:
Consolidated income statement
Consolidated statement of comprehensive income
Consolidated statement of financial position
Consolidated statement of cash flows
Consolidated statement of changes in net equity
Group annual report
and financial
statements
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|
03 Group annual report and financial statements 90
(€/000) Notes 2023
of which operative
non-recurring
2022
of which operative
non-recurring
Revenue from contracts with customers 1 3,043,086 3,126,940
Other revenues 1 32,818 31,493
Total consolidated revenues 3,075,904 3,158,433
Raw and ancillary materials, consumables and goods 2 (1,301,454 ) (1,194,715 )
Change in inventories of finished products and work in progress 3-8 (23,588 ) 753 (235,736 ) 1,924
Change in inventories of raw and ancillary materials, consumables and goods 3 (10,800 ) 5,519
Materials consumed (1,335,842 ) 753 (1,424,932 ) 1,924
Payroll costs 4-8 (393,246 ) (1,036 ) (356,710 ) 500
Services and other operating expenses 5-8-15 (885,207 ) (4,727 ) (987,496 ) (1,432 )
Provisions 6-8 (23,790 ) (492 ) (19,919 ) 7,258
Amortization 7-15 (108,191 ) (105,838 )
EBIT 329,628 (5,502 ) 263,538 8,250
Net financial income (expenses) 9-15 (2,330 ) (25,341 )
Profit (loss) before taxes 327,298 238,197
Taxes 10 (76,886 ) (58,354 )
Consolidated profit (loss) 250,412 179,843
Profit (loss) pertaining to minority 31 35 2,415
Consolidated profit (loss) after taxes 250,377 177,428
Earnings per share (in Euro) 32
- basic € 1.67 € 1.18
- diluted € 1.65 € 1.16
Appendix 3 reports the effect of related party transactions on the income statement, as required by CONSOB Resolution 15519 of 27 July 2006.
Consolidated Income
Statement
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|
03 Group annual report and financial statements 91
(€/000) 2023 2022
Consolidated profit (loss) 250,412 179,843
Other components of the comprehensive income:
Change in fair value of cash flow hedges (614 )
(3,893 )
Tax effect on change in fair value of cash flow hedges 376 525
Differences from translating foreign companies' financial statements into Euro (33,384 ) 28,483
Total other comprehensive income will subsequently be reclassified to profit (loss) for the year (33,622 ) 25,115
Actuarial valuation funds (3,801 ) 11,087
Tax effect of actuarial valuation funds 830 (2,970 )
Total other comprehensive income will not subsequently be reclassified to profit (loss) for the year (2,971 ) 8,117
Total components of comprehensive income (36,593 ) 33,232
Total comprehensive income 213,819 213,075
Total comprehensive income attributable to:
Group 213,755 210,819
Minority interest 64
Consolidated statement of
comprehensive income
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03 Group annual report and financial statements 92
ASSETS
(€/000)
Notes 31.12.2023 31.12.2022
Non-current assets
Intangible assets 878,330 891,181
- Goodwill 11 371,686 373,754
- Other intangible assets 12 506,644 517,427
Property, plant and equipment 477,981 446,899
- Land, property, plant and machinery 13 226,757 210,818
- Other tangible assets 14 154,799 158,071
- Right of use assets 15 96,425 78,010
Equity investments and other financial assets 131,725 136,336
- Equity investments 16 4,294 6,103
- Receivables 17 5,400 5,609
- Other non-current financial assets 18 122,031 124,624
Deferred tax assets 19 60,413 64,634
Total non-current assets 1,548,449 1,539,050
Current assets
Inventories 20 504,678 550,659
Trade receivables 21 272,692 278,811
Current tax assets 22 20,244 15,512
Other receivables 23 43,695 29,884
Current financial receivables and assets 24-15 172,472 368,354
Cash and cash equivalents 25 1,250,198 770,247
Total current assets 2,263,979 2,013,467
Non-current assets held for sale 26 -
Total assets 3,812,428 3,553,706
Appendix 3 reports the effect of related party transactions on the balance sheet, as required by CONSOB Resolution 15519 of 27 July 2006.
Consolidated statement
of financial position
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03 Group annual report and financial statements 93
Consolidated statement
of financial position
Net equity and liabilities
€/000
Notes 31.12.2023 31.12.2022
Net equity
Group portion of net equity 1,811,139 1,659,117
- Share Capital 29 226,590 226,590
- Reserves 30 1,334,172 1,255,099
- Profit (loss) pertaining to the Group 250,377 177,428
Minority interest 31 - 4,274
Total net equity 1,811,139 1,663,391
Non-current liabilities
Financial payables 593,079 773,968
- Banks loans and borrowings (long-term portion) 33 300,844 477,582
- Other financial payables (long-term portion) 34 214,617 236,026
- Lease liabilities (long-term portion) 15 77,618 60,360
Deferred tax liabilities 19 72,164 83,254
Non-current provisions for contingencies and other charges 122,918 110,699
- Employee benefits 35 51,041 38,532
- Other provisions 36 71,877 72,167
Total non-current liabilities 788,161 967,921
Current liabilities
Trade payables 37 716,238 540,687
Financial payables 289,022 190,476
- Banks loans and borrowings (short-term portion) 33 196,005 91,510
- Other financial payables (short-term portion) 34 72,012 78,502
- Lease liabilities (short-term portion) 15 21,005 20,464
Current tax liabilities 38 70,571 76,264
Other payables 39 137,297 114,967
Total current liabilities 1,213,128 922,394
Total net equity and liabilities 3,812,428 3,553,706
Appendix 3 reports the effect of related party transactions on the balance sheet, as required by CONSOB Resolution 15519 of 27 July 2006.
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03 Group annual report and financial statements 94
Consolidated statement of cash flow
(€/000) Notes 2023 2022
Profit (loss) pertaining to the Group 250,377 177,428
Income taxes for the period 76,886 58,354
Amortization 108,191 105,838
Net change in provisions and other non-cash items 10,851 (1,661 )
Cash flow generated by current operations (A) 446,305 339,959
Change in assets and liabilities for the period:
Trade receivables 2,369 103,352
Inventories 34,553 230,225
Trade payables 186,920 (417,726 )
Other changes in net working capital 11,740 203
Payment of income taxes (97,555 ) (104,086 )
Cash flow generated (absorbed) by movements in working capital (B) 138,027 (188,032 )
Cash flow generated by current operations and movements in working capital (A+B) 584,332 151,927
Investment activities:
Investments in intangible assets (18,670 ) (15,282 )
Other cash flows for intangible assets - -
Investments in property, plant and equipment (76,632 ) (113,638 )
Other cash flows for property, plant and equipment 1,933 522
Net investments in financial assets and in minority interest 1,147 (890 )
Cash flow absorbed by ordinary investment activities (C) (92,222 ) (129,288 )
Cash flow by operating activities (A+B+C) 492,110 22,639
FX effect on cash and cash equivalents (15,473 ) 26,428
Exercise of stock option 5,101 3,355
Dividends paid (72,429 ) (124,637 )
New loans - 200,000
Payment of interests on loans (22,327 ) (6,334 )
Repayment of loans and other net changes in sources of finance 92,934 (379,700 )
Increase of minority interest 35 2,415
Cash flow generated (absorbed) by changes in net equity and by financing activities (D) (12,159 ) (278,473 )
Cash flow for the period (A+B+C+D) 479,951 (255,834 )
Opening cash and cash equivalents 25 770,247 1,026,081
Cash flow for the period (A+B+C+D) 479,951 (255,834 )
Closing cash and cash equivalents 25 1,250,198 770,247
Appendix 2 reports the statement of cash flows in terms of net financial position.
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03 Group annual report and financial statements 95
Consolidated statement
of changes in net equity
(€/000)
Share
capital
Share
Premium
Reserve
Legal
reserve
Extraordi-
nary reserve
Treasury
shares
reserves
Fair value
and cash
flow hedge
reserves
Stock
option
reserve
Currency
translation
reserve
Profit
(loss)
carried
forward
Profit (loss)
pertaining to
group
Group
portion of
net equity
Minority
interest
Total net
equity
Balance at 31 December 2021 226,344 34,300 45,168 188,113 (14,534 ) 3,865 8,488 45,638 720,097 311,098 1,568,577 2,018 1,570,595
Allocation of 2021 result as per AGM
resolution of 20 april 2022
- distribution of dividends (17,503 ) (106,998 ) (124,501 ) (124,501 )
- allocation to reserves 101 310,997 (311,098 ) - -
Fair value stock option 867 867 867
Exercise/cancellation of stock option 246 3,968 2,123 (2,982 ) 3,355 3,355
Movements from transactions with
shareholders
Profit (loss) after taxes 177,428 177,428 2,415 179,843
Other components of comprehensive
income
(3,368 ) 28,642 8,117 33,391 (159 ) 33,232
Comprehensive income (loss) - - - - - (3,368 ) - 28,642 8,117 177,428 210,819 2,256 213,075
Balance at 31 December 2022 226,590 38,268 45,269 172,733 (14,534 ) 497 6,373 74,280 932,213 177,428 1,659,117 4,274 1,663,391
Balance at 31 December 2022 226,590 38,268 45,269 172,733 (14,534 ) 497 6,373 74,280 932,213 177,428 1,659,117 4,274 1,663,391
Allocation of 2022 result as per AGM
resolution of 21 April 2023
- distribution of dividends (72,079 ) (72,079 ) (72,079 )
- allocation to reserves 49 28,680 148,699 (177,428 ) - -
Fair value stock option 907 907 907
Exercise of stock option 1,810 4,876 (1,585 ) 5,101 5,101
Other changes in minority interests 4,338 4,338 (4,338 ) -
Movements from transactions with
shareholders
Profit (loss) after taxes 250,377 250,377 35 250,412
Other components of comprehensive
income
(238 ) (33,413 ) (2,971 ) (36,622 ) 29 (36,593 )
Comprehensive income (loss) - - - - - (238 ) - (33,413 ) (2,971 ) 250,377 213,755 64 213,819
Balance at 31 December 2023 226,590 40,078 45,318 201,413 (9,658 ) 259 5,695 40,867 1,010,200 250,377 1,811,139 - 1,811,139
Explanatory notes
Group annual report
and financial
statements
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Explanatory notes
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Comments on the income
statement
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Comments on the statement of
financial position: assets
Non-current assets
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Current assets
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Comments on the statement of financial
position: net equity and liabilities
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Liabilities
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Appendices
Group annual report
and financial
statements
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Appendices
These appendices contain additional information to that reported in the explanatory notes, of which they
form an integral part.
This information is contained in the following appendices:
1. List of consolidated companies
2. Statement of consolidated cash flows in terms of net financial position
3. Transactions and balances with related parties:
a. Income statement and statement of financial position
b. Summary by company
3. Fees paid to the external auditors
4. Certification of the consolidated financial statements pursuant to art. 81‐ter of CONSOB Regulation
11971 dated 14 May 1999 and subsequent amendments and additions.
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APPENDIX 1
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APPENDIX 2
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APPENDIX 3
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APPENDIX 4
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APPENDIX 5
Certification of the consoli-
dated financial statements
pursuant to art. 81-ter of
CONSOB Regulation 11971
dated 14 May 1999 and sub-
sequent amendments and
additions
The undersigned Fabio de’ Longhi, Chief Executive
Officer, and Stefano Biella, as Officer Responsible
for Preparing the Company’s Financial Report of
De’ Longhi S.p.A., attest, also taking account of the
provisions of paragraphs 2, 3 and 4, art. 154-bis of
Decree 58 dated 24 February 1998:
that the accounting and administrative processes
for preparing the consolidated financial statements
during 2023:
• have been adequate in relation to the company’s
characteristics and
• have been effectively applied.
It is also certified that the consolidated financial
statements at 31 December 2023:
• have been prepared in accordance with the Inter-
national Financial Reporting Standards adopted
by the European Union under Regulation (EC)
1606/2002 of the European Parliament and
Council dated 19 July 2002 and with the meas-
ures implementing art. 9 of Decree 38/2005;
• correspond to the underlying accounting records
and books of account;
• are able to provide a true and fair view of the is-
suer’s statement of financial position and results
of operations and of the Group of companies in-
cluded in the consolidation.
The report on operations contains a reliable ac-
count of performance and of the results of opera-
tions and of the situation of the issuer and the
Group of companies included in the consolidation,
together with a description of the principal risks
and uncertainties to which they are exposed.
Fabio de’Longhi
Chief Executive Officer
Stefano Biella
Officer Responsible for Preparing the Company’s Fi-
nancial Report
External auditors’ report on the
consolidated financial statements
Group annual report
and financial
statements
Independent auditor’s report
in accordance with article 14 of Legislative Decree No. 39 of 27 January 2010 and article 10 of
Regulation (EU) No. 537/2014
To the shareholders of De’ Longhi SpA
Report on the Audit of the Consolidated Financial Statements
Opinion
We have audited the consolidated financial statements of De’ Longhi Group (the Group), which
comprise the statement of financial position as of 31 December 2023, the income statement, the
statement of comprehensive income, the statement of changes in net equity, the statement of cash
flows for the year then ended, and explanatory notes to the consolidated financial statements,
including material accounting policy information.
In our opinion, the consolidated financial statements give a true and fair view of the financial position
of the Group as of 31 December 2023, and of the result of its operations and cash flows for the year
then ended in accordance with International Financial Reporting Standards as adopted by the
European Union, as well as with the regulations issued to implement article 9 of Legislative Decree
No. 38/05.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISA Italia).
Our responsibilities under those standards are further described in the Auditor’s Responsibilities for
the Audit of the Consolidated Financial Statements section of this report. We are independent of De’
Longhi SpA pursuant to the regulations and standards on ethics and independence applicable to
audits of financial statements under Italian law. We believe that the audit evidence we have obtained
is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the consolidated financial statements of the current period. These matters were
addressed in the context of our audit of the consolidated financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
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Key Audit Matters Auditing procedures performed in
response to key audit matters
Recoverability of the value of indefinite-
lived intangible assets
Notes 11 and 12 to the consolidated financial
statements
The consolidated financial statements of De’
Longhi SpA SpA include indefinite-lived
intangible assets, which are not amortised but
tested for impairment at least annually.
Indefinite-lived intangible assets comprise
goodwill for Euro 371.7 million and trademarks
for Euro 334.5 million; the latter comprise the
“De’ Longhi” trademark for Euro 79.8 million, a
perpetual licence on the “Braun” brand for Euro
95.0 million, the “Nutribullet”/”Magic Bullet”
trademark for Euro 120.0 million and the
“Eversys” trademark for Euro 39.2 million.
For the purpose of impairment testing, goodwill
was allocated to the following cash-generating
units (“CGUs”): De’ Longhi, Kenwood, Braun,
Capital Brands and Eversys.
To estimate the recoverable amount of the
individual CGUs, management calculated value in
use using the discounted cash flow method: value
in use is calculated as the sum of the present value
of the future cash flows over the explicit forecast
horizon and a terminal value obtained applying a
long-term growth rate to the last year of the
business plan. The recoverable amount of each
CGU to which goodwill has been allocated was
compared with the net invested capital of the
individual CGUs.
Moreover, the carrying amounts of trademarks
were tested for impairment. The method adopted
for testing, in order to determine the fair values of
these assets, consisted in discounting to present
value the royalties that the Group would be able
to earn by transferring the right to use the
trademark in question to a third party on a
permanent basis.
This method involves estimating the sales
volumes that can reasonably be expected from the
trademarks being tested, the royalty flows and the
discount rate. The recoverable amounts thus
obtained were compared with the carrying
amounts of the trademarks.
As part of our audit of the consolidated
financial statements as of 31 December 2023,
we performed the procedures illustrated
below.
We obtained the exercises prepared by
management to determine the recoverable
amounts of the CGUs identified and
trademarks. The impairment tests were
approved by the board of directors on 12
March 2024.
Our audit approach was based on analysing
the method used by the directors to prepare
the tests and included the following
procedures:
we understood and evaluated the Group’s
internal control over the process of
testing the recoverability of indefinite-
lived assets;
we analysed the reasonableness of
management’s considerations about the
identification of the CGUs and the
process of allocation of net assets to the
individual CGUs;
we analysed the estimated future cash
flows from the CGUs to which goodwill
was allocated and, with regard to
trademarks, the royalty flows, which were
used in the impairment test models,
specifically verifying the reasonableness
of the assumptions used, in light of the
past results of individual CGUs and
individual brands and comparing the
growth rates used by management with
external sources.
With the support of business valuation
experts from the PwC network, we verified
that the valuation methods used for the
impairment tests were consistent with
International Financial Reporting Standards
as adopted by the European Union and with
prevailing practice. Moreover, the key
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In the course of our audit of the consolidated
financial statements as of 31 December 2023, we
focused on these items as a key audit matter in
consideration of the magnitude of the balances
and the fact that the assets’ recoverability was
verified by management based on assumptions
that are sometime complex, and that by nature
involve the use of management’s judgement,
specifically with reference to the estimation of the
future cash flows expected to be generated from
each CGU and of royalties from trademarks, and
the determination of the long-term growth rates
and discount rates applied.
valuation parameters adopted were analysed
in terms of reasonableness. With specific
reference to the method of calculation of
discount rates, royalty rates, and medium-
/long-term growth rates, we verified that
these had been determined in accordance
with International Financial Reporting
Standards as adopted by the European Union,
with prevailing practice and based on
available market figures. Moreover, we
verified the sensitivity analyses prepared by
management.
We verified the mathematical accuracy of the
calculations of the impairment tests and of
the carrying amounts of net invested capital
of the CGUs identified, determined in
accordance with IAS 36 as of 31 December
2023 that were used for comparison with
values in use.
Finally, our procedures included an analysis
of the notes to the consolidated financial
statements to assess the adequacy and
completeness of disclosures.
Responsibilities of the Directors and the Board of Statutory Auditors for the
Consolidated Financial Statements
The directors are responsible for the preparation of consolidated financial statements that give a true
and fair view in accordance with International Financial Reporting Standards as adopted by the
European Union, as well as with the regulations issued to implement article 9 of Legislative Decree
No. 38/05 and, in the terms prescribed by law, for such internal control as they determine is
necessary to enable the preparation of consolidated financial statements that are free from material
misstatement, whether due to fraud or error.
The directors are responsible for assessing the Group’s ability to continue as a going concern and, in
preparing the consolidated financial statements, for the appropriate application of the going concern
basis of accounting, and for disclosing matters related to going concern. In preparing the
consolidated financial statements, the directors use the going concern basis of accounting unless they
either intend to liquidate De’ Longhi SpA or to cease operations, or have no realistic alternative but to
do so.
The board of statutory auditors is responsible for overseeing, in the terms prescribed by law, the
Group’s financial reporting process.
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Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated 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 (ISA Italia) 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 the
consolidated financial statements.
As part of our audit conducted in accordance with International Standards on Auditing (ISA Italia),
we exercised professional judgement and maintained professional scepticism throughout the audit.
Furthermore:
we identified and assessed the risks of material misstatement of the consolidated financial
statements, whether due to fraud or error; we designed and performed audit procedures
responsive to those risks; we obtained 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;
we obtained 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 internal control;
we evaluated the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors;
we concluded on the appropriateness of the directors’ use of the going concern basis of
accounting 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 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 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 to cease to
continue as a going concern;
we evaluated the overall presentation, structure and content of the consolidated financial
statements, including the disclosures, and whether the consolidated financial statements
represent the underlying transactions and events in a manner that achieves fair presentation.
we obtained 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 on the consolidated
financial statements.
We communicated with those charged with governance, identified at an appropriate level as required
by ISA Italia 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 identified
during our audit.
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We also provided those charged with governance with a statement that we complied with the
regulations and standards on ethics and independence applicable under Italian law and communicated
with them all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, actions taken to eliminate the related risks, or safeguards
applied.
From the matters communicated with those charged with governance, we determined those matters
that were of most significance in the audit of the consolidated financial statements of the current
period and are therefore the key audit matters. We described these matters in our auditor’s report.
Additional Disclosures required by Article 10 of Regulation (EU) No. 537/2014
On 19 April 2018, the shareholders of De’ Longhi SpA in general meeting engaged us to perform the
statutory audit of the Company’s and the consolidated financial statements for the years ending
31 December 2019 to 31 December 2027.
We declare that we did not provide any prohibited non-audit services referred to in article 5,
paragraph 1, of Regulation (EU) No. 537/2014 and that we remained independent of the Company in
conducting the statutory audit.
We confirm that the opinion on the consolidated financial statements expressed in this report is
consistent with the additional report to the board of statutory auditors, in its capacity as audit
committee, prepared pursuant to article 11 of the aforementioned Regulation.
Report on Compliance with other Laws and Regulations
Opinion on compliance with the provisions of Commission Delegated Regulation (EU)
No. 2019/815
The directors of De’ Longhi SpA are responsible for the application of the provisions of Commission
Delegated Regulation (EU) No. 2019/815 concerning regulatory technical standards on the
specification of a single electronic reporting format (ESEF - European Single Electronic Format)
(hereinafter, the “Commission Delegated Regulation”) to the consolidated financial statements as of 31
December 2023, to be included in the annual report.
We have performed the procedures specified in auditing standard (SA Italia) No. 700B in order to
express an opinion on the compliance of the consolidated financial statements with the provisions of
the Commission Delegated Regulation.
In our opinion, the consolidated financial statements as of 31 December 2023 have been prepared in
XHTML format and have been marked up, in all significant respects, in compliance with the provisions
of the Commission Delegated Regulation.
Due to certain technical limitations, some information included in the explanatory notes to the
consolidated financial statements when extracted from the XHTML format to an XBRL instance may
not be reproduced in an identical manner with respect to the corresponding information presented in
the consolidated financial statements in XHTML format.
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Opinion in accordance with Article 14, paragraph 2, letter e), of Legislative Decree
No. 39/10 and Article 123-bis, paragraph 4, of Legislative Decree No. 58/98
The directors of De’ Longhi SpA are responsible for preparing a report on operations and a report on
the corporate governance and ownership structure of the De’ Longhi Group as of 31 December 2023,
including their consistency with the relevant consolidated financial statements and their compliance
with the law.
We have performed the procedures required under auditing standard (SA Italia) No. 720B in order to
express an opinion on the consistency of the report on operations and of the specific information
included in the report on corporate governance and ownership structure referred to in article 123-bis,
paragraph 4, of Legislative Decree No. 58/98, with the consolidated financial statements of the
De’ Longhi Group as of 31 December 2023 and on their compliance with the law, as well as to issue a
statement on material misstatements, if any.
In our opinion, the report on operations and the specific information included in the report on
corporate governance and ownership structure mentioned above are consistent with the consolidated
financial statements of De’ Longhi Group as of 31 December 2023 and are prepared in compliance with
the law.
With reference to the statement referred to in article 14, paragraph 2, letter e), of Legislative Decree
No. 39/10, issued on the basis of our knowledge and understanding of the Company and its
environment obtained in the course of the audit, we have nothing to report.
Statement in accordance with article 4 of Consob’s Regulation implementing
Legislative Decree No. 254 of 30 December 2016
The directors of De’ Longhi SpA are responsible for the preparation of the non-financial statement
pursuant to Legislative Decree No. 254 of 30 December 2016.
We have verified that the directors approved the non-financial statement.
Pursuant to article 3, paragraph 10, of Legislative Decree No. 254 of 30 December 2016, the non-
financial statement is the subject of a separate statement of compliance issued by ourselves.
Treviso, 28 March 2024
PricewaterhouseCoopers SpA
Signed by
Filippo Zagagnin
(Partner)
This independent auditor’s report has been translated into the English language solely for the
convenience of international readers. Accordingly, only the original text in Italian language is
authoritative.
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Independent auditors’ report on
consolidated Non-Financial
Statement
Group annual report
and financial statement
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Report on
operations on
separate financial
statements
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04 Report on operations on separate financial statements 160
Review of the income
statement
(€/million) 2023 % revenues 2022 % revenues
Revenues 15.2 100.0% 12.7 100.0%
Change 2.5 19.7%
Materials consumed (0.1) (0.4%) (0.1) (0.5%)
Services and other operating expenses (18.9) (124.4%) (18.8) (148.7%)
Payroll (12.6) (83.0%) (7.0) (55.1%)
EBITDA before non-recurring/stock option costs (16.3) (107.8%) (13.2) (104.4%)
Change (3.1) 23.6%
Non-recurring expenses/stock option costs (6.0) (39.3%) (0.9) (6.8%)
EBITDA (22.3) (147.1%) (14.1) (111.2%)
Amortization (0.4) (2.8%) (0.4) (3.1%)
EBIT (22.7) (149.9%) (14.5) (114.3%)
Change (8.2) 56.9%
Dividends 51.9 342.6% 132.9 1,049.5%
Net financial income (expenses) 4.0 26.7% (11.9) (93.6%)
Profit (loss) before taxes 33.2 219.3% 106.6 841.6%
Taxes 3.3 22.0% (5.8) (45.8%)
Net Result 36.6 241.3% 100.8 795.8%
De’ Longhi S.p.A, the parent of the De’ Longhi Group,
performs holding company activities involving the
management and supply of centralized services to
its subsidiaries. The income statement, therefore,
reflects the dividends received from the subsidiar-
ies, other chargebacks for services provided, as
well as operating (payroll costs and the cost of ser-
vices) and financial expenses.
In 2023 dividends amounted to €51.9 million
(€132.9 million in 2022) while net financial expens-
es came to €4.0 million (€11.9 million in 2022).
Net financial expenses include the interest income
relating to the Group cash pooling balance and the
interest on the Company’s financial debt (recalcu-
lated using the amortized cost method).
Net profit came to €36.6 million (€100.8 million in
2022).
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04 Report on operations on separate financial statements 161
Review of the statement
of financial position
The reclassified statement of financial position is presented below:
(€/million) 31.12.2023 31.12.2022 Change Change %
- Tangible and intangible assets 1.0 1.2 (0.1) (12.4%)
- Financial assets 615.5 567.5 48.0 8.5%
Non-current assets 616.5 568.7 47.9 8.4%
- Trade receivables 12.5 1.2 11.3 925.1%
- Trade payables (11.7) (7.6) (4.1) 53.6%
- Other receivables (net of payables) 4.6 1.0 3.6 350.8%
Net working capital 5.4 (5.4) 10.8 (201.0%)
Total non-current liabilities and provisions (9.5) (16.9) 7.4 (43.8%)
Net capital employed 612.5 546.4 66.0 12.1%
Net financial position 54.9 (42.1) 97.0 (230.4%)
Total net equity 557.6 588.5 (31.0) (5.3%)
Total net debt and equity 612.5 546.4 66.0 12.1%
The net financial position amounted to €54.9 million at 31 December 2023 (positive for €42.1 million at 31
December 2022), broken down as follows:
(€/million) 31.12.2023 31.12.2022 Change
Cash and cash equivalents 1.6 2.5 (0.9)
Other financial receivables 661.5 861.9 (200.4)
Current financial debt (202.1) (110.1) (92.0)
Net current financial position 461.0 754.3 (293.3)
Non-current net financial debt (515.9) (712.2) 196.3
Total net financial position (54.9) 42.1 (97.0)
of which:
- positions with banks and other financial
payables
(56.1) 39.2 (95.3)
- lease liabilities (1.0) (1.0) -
- other net assets/(liabilities): fair value of
derivatives
2.2 3.9 (1.7)
Net debt includes a few specific financial items, including the fair value measurement of derivatives which
shows a net positive balance of €2.2 million at 31 December 2023 (positive for €3.9 million at 31 December
2022).
The net financial position at 31 December 2023 also includes the impact of IFRS 16 adoption with resulted
in the recognition of €1.0 million in “Lease payables” (€1.0 million at 31 December 2022).
Net of these items, the net financial position with banks was €56.1 million at 31 December 2023.
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04 Report on operations on separate financial statements 162
The statement of cash flows, reclassified on the basis of net financial position, is summarized as follows:
(€/million) 2023 2022
Cash flow by current operations (14.2) (27.3)
Cash flow by changes in working capital (17.6) 6.5
Cash flow by investment activities 3.6 132.7
Cash flow by operating activities (28.1) 111.9
Dividends paid (72.1) (124.5)
Cash flow by changes in cash flow hedge
reserves
(1.9) 3.4
Stock options exercise 5.1 3.3
Cash flow generated (absorbed) by changes in
net equity
(68.9) (117.8)
Cash flow for the period (97.0) (5.9)
Opening net financial position 42.1 48.0
Closing net financial position (54.9) 42.1
Negative net operating cash flow amounted to €28.1 million (positive €111.9 million in 2022), a decrease of
€ 140.0 million with respect to the prior year. This change is mainly affected by a payment settle during the
year to recapitalize a subsidiary and lower dividends received from subsidiaries, which will be distributed in
the coming months.
Cash flow to net equity reached a negative €68.9 million (negative €117.8 million in 2022), explained primar-
ily by dividend payments of €72.1 million, the exercise of stock options for €5.1 million and the change in the
cash flow hedge reserve relating to the fair value of derivatives of €1.9 million.
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04 Report on operations on separate financial statements 163
Reconciliation of
net equity and profit
(loss) for the year
Below is a concise reconciliation between net equity and profit of the parent company, De’ Longhi S.p.A., and
the figures shown in the consolidated financial statements:
(€/000)
Net equity
31.12.2023
Profit for
2023
Net equity
31.12.2022
Profit for
2022
De’ Longhi S.p.A. financial statements 557,569 36,578 588,531 100,808
Share of subsidiaries' equity and results for
period attributable to the Group, after deducting
carrying value of the investments
835,561 218,905 649,687 59,442
Allocation of goodwill arising on consolidation
and related amortization and reversal of
goodwill recognized for statutory purposes
463,150 (444) 465,679 5,308
Elimination of intercompany profits (45,425) (4,613) (40,820) 14,286
Other adjustments 284 (14) 314 (1)
Consolidated financial statements 1,811,139 250,412 1,663,391 179,843
Minority - 35 4,274 2,415
Consolidated financial statements-Group
portion
1,811,139 250,377 1,659,117 177,428
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04 Report on operations on separate financial statements 164
Annual
remuneration
report
Human resources
and organization
Please refer to the yearly Report on Remuneration for all relevant information not contained in the present
report.
The company had 55 employees at 31 December 2023 (55 at 31 December 2022).
The following table summarizes the average number of employees during 2023 compared with 2022:
2023 % 2022 % Change
White collars 38 68% 41 71% (3)
Managers 18 32% 17 29% 1
Total 56 100% 58 100% (2)
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04 Report on operations on separate financial statements 165
Research
and development
As a holding company, the Company does not carry out any research and development directly. These activ-
ities are carried out by employees of the individual subsidiaries. More details can be found in the paragraph
on “Research and Development - quality control” found in the Report on Operations accompanying the con-
solidated financial statements.
Report on corporate
governance and ownership
structure
Company’s Report on Corporate Governance and Ownership Structure drawn up in accordance with art. 123
- bis of the Uniform Finance Act can be found in a report not included in the Report on Operations, published
at the same time as the latter and available on the company’s website www.delonghigroup.com (section
Home > Governance > Corporate bodies >Shareholders’ Meeting 2024).
Pursuant to art. 16.4 of the Market Regulations please note that the Company is not subject to the direction
and control of the parent company De Longhi Industrial S.A., or of any other party, pursuant to and in accord-
ance with articles 2497 et seq of the Italian Civil Code, insofar as (i) the Group’s business, strategic and fi-
nancial plans, as well as the budget, are approved independently by the Company’s Board of Directors; (ii)
the financial and funding policies are defined by the Company; (iii) the Company conducts its relationships
with clients and suppliers in full autonomy; and (iv) in accordance with the principles of the Corporate Gov-
ernance Code, important strategic, economic, equity and financial transactions are examined by the board
and approved exclusively by the Board of Directors.
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04 Report on operations on separate financial statements 166
Risk management
and internal control system
relating to the financial
reporting process
Introduction
The Company’s Internal Control System consists in
the set of rules, procedures and organizational
structures set in place to ensure that company
strategies are adhered to and, based on the corpo-
rate governance standards and model included in
the COSO report (Committee of Sponsoring Organi-
zations of the Treadway Commission), to
guarantee:
a. efficient and effective company operations (ad-
ministration, production, distribution, etc.);
b. reliable, accurate, trustworthy and timely eco-
nomic and financial information;
c. compliance with laws and regulations, as well
as the corporate articles of associations, rules
and company procedures;
d. safeguarding of the company’s assets and pro-
tection, to the extent possible, from losses;
e. identification, assessment, management and
monitoring of the main risks.
The executive administrative bodies of the Compa-
ny (Board of Directors, the Control and Risks, Cor-
porate Governance and Sustainability Committee,
Director in Charge of the Internal Control and Risk
Management System), the Board of Statutory Audi-
tors, the Director of Internal Audit, the Supervisory
Board, the Chief financial officer/Financial Report-
ing Officer and all De’ Longhi personnel, as well as
the Directors and Statutory Auditors of the Issuer’s
subsidiaries, are involved in the controls, with
different roles and in function of their expertise and
adhere to the recommendations and principles
found in the guidelines.
The Internal Control System that is subject to ex-
amination and periodic audits, taking into account
changes in the company’s operations and refer-
ence context, makes it possible to address the
main risks to which the Issuer and the Group are
exposed to over time, in a timely manner, as well as
to identify, assess and control the degree of the ex-
posure of the Issuer and all the other companies of
the Group - particularly the strategically important
subsidiaries - to the different types of risk, and also
makes it possible to manage the overall exposure
taking into account:
i. the possible correlations between the different
risk factors;
ii. the probability that the risk materializes;
iii. the impact of the risk on the company’s
operations;
iv. the overall impact of the risk.
The internal control and risk management system
relating to the financial reporting process (adminis-
trative and accounting procedures used to draft the
separate and consolidated annual financial state-
ments and the other economic and/or financial re-
ports and disclosures prepared in accordance with
the law and/or regulations, as well as ensuring cor-
rect implementation) coordinated by the Chief fi-
nancial officer/Financial Reporting Officer, is an in-
tegral and essential part of the Company’s Internal
Control and Risk Management System.
The Director of Internal Audit - who is in charge of
verifying that the internal control and risk manage-
ment system works efficiently and effectively - pre-
pares a work plan each year that is presented to the
Board of Directors for approval, subject to the posi-
tive opinion of the Control and Risks, Corporate
Governance and Sustainability Committee and
after having consulted with the Board of Statutory
Auditors and the Director in Charge of the Internal
Control and Risk Management System, based also
on the comments made by the Chief financial of-
ficer/Financial Reporting Officer, as well as pursu-
ant to Legislative Decree 262/05. Discusses the
steps taken to resolve any problems, to make the
improvements agreed upon, as well as the results
of the testing activities with the Control and Risks,
Corporate Governance and Sustainability Commit-
tee. Provides the Chief financial officer/Financial
Reporting Officer, as well as the administrative
body assigned, with a summary report based on
which they can assess the adequacy and applica-
tion of administrative procedures to be used to pre-
pare the financial statements.
Description of main characteristics
The Company uses a system of risk management
and internal control for the financial reporting pro-
cess that is part of the wider system of internal
controls as required under art. 123-bis par. 2 (b) of
TUF.
For the purposes of ensuring reliable internal con-
trols over its financial reporting, the Company has
implemented a system of administrative and ac-
counting procedures and operations that include
an updating in order to comply with the law and
changing accounting standard, rules for consolida-
tion and interim financial reporting, as well as coor-
dination with subsidiaries as needed.
The central corporate functions are responsible for
managing and communicating these procedures
to other Group companies.
The assessment, monitoring and continuous up-
dating of the internal control system relating specif-
ically to financial reporting is carried out in accord-
ance with the COSO model and, where applicable,
Law 262/2005. Critical processes and sub-pro-
cesses relating to the principal risks have been
identified in order to establish the principal controls
needed to reduce such risks. This has involved
identifying the strategically important companies,
based on quantitative and qualitative financial pa-
rameters (i.e. companies that are relevant in terms
of size and companies that are relevant just in
terms of certain processes and specific risks).
Having identified these companies, the risks have
been mapped and assessed and the key manual
and automatic controls have been identified and
rated as high/medium/low priority accordingly;
these controls have then been tested.
The perimeter of the companies included in the
mapping for the purposes of Law 262/2005 has
De’Longhi Group
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04 Report on operations on separate financial statements 167
changed over the years to reflect the changes in the
Group, both quantitative and qualitative, and this
perimeter was also considered for the definition of
companies viewed as strategic.
The general managers and administrative heads of
each Group company are responsible for maintain-
ing an adequate internal control system and, given
their roles, must certify that the internal control
system works properly.
Internal Audit must also include verification of the
internal controls through the use of a self-assess-
ment check list in its Audit Plan.
With regard to compliance with Consob Regulation
20249 of 28 December 2017 relating to market reg-
ulations (“Regolamento Mercati”), De’ Longhi S.p.A.
controls, directly or indirectly, seven companies
formed and regulated by the law of countries that
are not part of the European Union considered rele-
vant pursuant to art. 151 of the issuer regulations
(“Regolamento Emittenti”).
With reference to the requirements of art. 15 of the
Market Regulations, it is reported as follows:
• in the issuer’s opinion, these companies have
suitable accounting and reporting systems for
regularly providing management and the audi-
tors of De’ Longhi S.p.A. with all the financial in-
formation needed to prepare the consolidated fi-
nancial statements and perform the audit of the
accounts;
• these companies provide the auditors of De’
Longhi S.p.A. with the information needed to
audit the parent company’s interim and annual
financial statements;
• the issuer keeps the articles of association of the
aforementioned companies and details of their
company officers and related powers, which are
constantly updated for any changes in the same;
• the financial statements of such companies, pre-
pared for the purposes of the De’ Longhi Group’s
consolidated financial statements, have been
made available in the manner and terms estab-
lished by existing law. Please note that the identi-
fication and analysis of the risk factors con-
tained in this report were carried out including in
light of the change in strategic companies as re-
solved by the Board of Directors.
In order to identify and manage the Company’s
main risks, with regard particularly to corporate
governance and compliance with the law and regu-
latory standards (including, specifically the recom-
mendations found in the Corporate Governance
Code for Listed Companies), the Company under-
took to develop and monitor a structured Enter-
prise Risk Management model.
The purpose underlying the implementation and
deployment of the Enterprise Risk Management
(ERM) system is to strengthen the risk control and
management system by mapping the main risks to
which the Group is exposed along its value chain,
identifying the inherent and relative residual risk, as
well as defining and implementing the actions
needed to eliminate and/or mitigate them.
The ERM system also includes a list of risks con-
nected to sustainability.
This reflects the gradual integration of environmen-
tal and social sustainability, as well as governance,
in the corporate strategy, risk management and
compensation processes, promoting a systemic
and transparent approach, respectful of the
standards found in the Code of Ethics, with a view
to also guaranteeing diversity, equal opportunity,
fairness and no discrimination of any kind. These
risks also include climate change.
In 2023 the on-boarding process was completed at
all the branches acquired in the prior year. In a con-
text characterized by an uncertain and complex
business landscape, periodic changes were made
to the risk scenarios in the main markets and the
production plants. A large group of international
managers was involved in revisiting and updating
the most imminent and impactful risks. At the
same time, the Management Teams of the compa-
nies involved revised the risk map and determined
what they viewed as the most critical risks.
Similar to the prior year, concerns about the global
market conditions continued to dominate in vari-
ous markets. Moving toward a period of post-pan-
demic normalization, the Group faced changes in
the business environment, including the transfor-
mation of the consumers’ preferences, supply
chain difficulties and challenges associated with
technological innovation.
From 2021 to 2023, the operational progress fueled
significant advantages, facilitating timely decisions
in response to global uncertainties. Crucial initiatives
like the digitalization of the supply chain, diversifica-
tion of the suppliers and centralization of a few activ-
ities at corporate headquarters made it possible to
improve estimates, made the integrated planning
process more efficient, made procurement more
flexible and intensified automation of operations.
These measures strengthened the Group’s operat-
ing resilience considerably, as proven by the quick
reaction to the risks associated with recent logistics
issues, like problems in the Suez Canal.
In order to further strengthen the monitoring of
risks, Internal Audit will monitor exogenous risk fac-
tors closely, deepen the understanding of the ERM
principles and will make ad hoc revisions to risk to-
gether with headquarter departments and local
management during the year. This goal will be
achieved by improving specific tools and launching
new initiatives destined to increase risk
awareness.
Risk factors
The risk factors and uncertainties that could mate-
rially affect the Company’s business are discussed
below.
These risk factors also take in to account the above
mentioned ERM project and the assessments car-
ried out in prior years including through more in
depth analysis shared with the Control and Risks,
Corporate Governance and Sustainability Commit-
tee and Company’s Board of Statutory Auditors.
With reference to the main risks, highlighted below,
the Company monitors and places continuous at-
tention to any situations and developments in the
macroeconomic, market and demand trends in
order to be able to implement any necessary and
timely strategic actions.
It should also be noted that in addition to the risk fac-
tors and uncertainties identified in this report, other
risks and uncertain events not currently foreseeable,
or which are currently thought unlikely, could also in-
fluence the business, the economic and financial
conditions and prospects of the Company.
De’Longhi Group
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04 Report on operations on separate financial statements 168
1 - Risks relating to macroeconomic trends:
the Company’s economic performance and
financial position are also affected by macro-
economic trends.
The current situation of general instability material-
ized at the same time in the world’s main developed
economies, albeit to varying degrees and for differ-
ent reasons. In Europe, the conflict in Ukraine and
logistical disruptions due to the crisis in the Red
Sea impact investments and the availability of
products in the markets, as well as influencing the
on-time delivery of components to European pro-
duction plants. In China, a slowdown in economic
growth is observed combined with a crisis in the
real estate sector. In the USA, intense inflationary
pressures, due to fiscal policies, and the risk of a
recession triggered by significant increases in inter-
est rates. The conflict in Gaza also contributed to
the deterioration of a situation of great instability in
countries in the Middle East.
The Company monitors these economic trends pe-
riodically in order to take quick strategic action as
needed.
The Group is also subject to the risks connected to
the spread of epidemics or serious health issues in
the main reference markets which could interrupt
or limit activities in these markets (in relation to op-
erations, the supply chain and/or the sale of prod-
ucts, as well as all the back-office activities) as well
as risks stemming from local conflicts which can
also affect key markets, as was the case in Ukraine.
These events are not foreseeable, but as a result of
past experiences the Company is able to react and
implement all the measures needed to limit the
consequences, as was the case in 2020/2021
when, due the global health crisis, the Group had to
face an unprecedented level of market uncertainty.
The persistence of these situations, however, could
interrupt and/or limit the Company’s activities
which would have an impact on economic and fi-
nancial results.
2 - Exchange rate fluctuation risks: the Com-
pany does business in many foreign markets
and is exposed to the risk of fluctuations in
currencies.
For the purposes of protecting its income state-
ment and statement of financial position from such
fluctuations, the Company adopts a suitable hedg-
ing policy and tools, free from speculative
connotations.
Hedging is carried out centrally by a special team
on the basis of information obtained from a de-
tailed reporting system, using instruments and pol-
icies that comply with international accounting
standards.
The main currencies to which the Company is ex-
posed are the US dollar, the HK dollar and the Brit-
ish pound.
Despite the Company’s effort to minimize the
abovementioned risk, sudden currency fluctuations
could have an adverse impact on the Company’s
results and business prospects.
3 - Risks relating to human resources man-
agement: the Company’s success largely de-
pends on the ability of its executive directors
and other members of management to effec-
tively manage the Company and the individ-
ual areas of business and on the profession-
alism of the human resources that it has been
able to attract and develop.
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04 Report on operations on separate financial statements 169
The principal risks relating to human resources are
linked to the Company’s ability to attract, develop,
motivate, retain and empower staff who have the
necessary talent, values, and specialist and/or
managerial skills to satisfy the Company’s chang-
ing needs.
The loss of such individuals or other key employees
without adequate replacement, or the failure to at-
tract and retain new qualified resources could
therefore adversely affect the Company’s business
prospects, as well as its economic performance
and/or financial position.
In terms of being able to attract quality resources,
the Company not only have specialist qualified pro-
fessional human resources teams, but they also
plan actions to improve the quality of working envi-
ronment for its employees and staff as well as the
Company’s external image (communication, con-
tact with schools and universities, testimonials, in-
ternships, etc.), in some cases using the services of
specialist professional firms with a proven track
record.
In terms of motivating and developing personnel,
actions taken include the strengthening of mana-
gerial, specialist, business and regulative compe-
tencies, with initiatives that involve managers and
staff from different areas of the business.
The salary review process also includes reward
systems for employees at various levels in the or-
ganization - from the staff through to top manage-
ment and key people - which are linked to the
achievement of short-term and/or medium/long
term targets.
Specific investments are made in the training and
development of internal resources and the im-
provement of the workplace environment
(cafeteria, recreational activities, lounge spaces
and access to WiFi).
4 - Risks relating to IT systems: the informa-
tion systems of a complex international group
are an important and delicate part of the
company’s processes.
The risks involved include events that could jeop-
ardise the ability to provide continuous service, the
safekeeping of data, obsolescence of telecommu-
nications and data processing technologies.
Cyber-attacks are a threat to any sector and there
has been a general, gradual increase in cy-
ber-crimes. Cyber Risk, namely the risk of financial
losses, interruptions or damages to an organiza-
tion’s reputation, stemming from accidents (for ex-
ample, shutting down servers) or intentional acts
(for example, theft of sensitive data) which damage
the IT system, has, therefore, become increasingly
important.
The Company has taken the steps needed to limit
the above mentioned risks which include the stand-
ard security devices used to protect systems and
hardware (from the use of back-up devices to out-
sourcing with specialized companies). Continuous
technological updates are assured by the prevalent
use of the SAP platform. While the Company has
taken all the steps needed to minimize these risks,
catastrophic events that could compromise the in-
formation systems cannot be excluded.
The Company has launched a multi-year Cyber
Risk Management project in order to analyze any
problem areas and take the actions needed to safe-
guard against this type of risk.
5 - Liquidity, financing and interest rate risks:
the liquidity risk possibly faced by the Com-
pany is the risk of not having the funds need-
ed to fulfil payment obligations arising from
operating and investment activities and from
the maturity of financial instruments. The
Company holds assets and liabilities that are
sensitive to interest rate changes and that are
necessary to manage its liquidity and finan-
cial needs.
It is the Company’s policy to maintain a sufficiently
large portfolio of counterparties of international
repute for the purposes of satisfying its financing
and hedging needs.
The Company uses specific policies and proce-
dures for the purposes of monitoring and manag-
ing this risk, including the centralized cash man-
agement (financial debt and cash management,
the raising of medium and long-term finance on
capital markets and the obtaining of short-term
credit lines that allow wide room for manoeuvre
when managing working capital and cash flows).
About the interest rate risk, at 31 December 2023
the Company’s financial debt is mainly medi-
um-long term, in order to take advantage of the
market conditions. The Company also has short-
term bank credit lines (typically renewed on an
annual basis), which are optionally used to finance
working capital and other operating needs.
In 2023 there was a sudden change in monetary
policies which resulted in a significant increase in
interest rates.
The management of this risk is centralized and
done using the same structure used to manage for-
eign exchange risk. Nevertheless, sudden
fluctuations in interest rates could have an adverse
impact on the Company’s business prospects, as
well on its economic results and/or financial
position.
At the date of this report, the Company has one
hedging agreement which protects the medium/
long term loans from fluctuations in the interest
rates.
6 - Compliance and corporate reporting risks:
A. Financial reporting: risks associated with the
reliability of financial reporting, particularly that
the information contained in the annual and inter-
im financial reports might not be correct, warrant
particular attention, especially for a listed
company.
In 2023, effective implementation of the system of
managing financial reporting risks was monitored
on a continuous basis and periodically evaluated
under the guidance of the functions in charge.
For the purposes of ensuring reliable internal finan-
cial reporting controls, the Company implemented
a system of administrative and accounting proce-
dures which include the accounting policy instruc-
tions, principles and updates, as well as other pro-
cedures for preparing the consolidated financial
statements and the periodic financial reports.
The Company’s central “Corporate” functions are
responsible for managing and communicating
these procedures to other Group companies. The
control bodies (internal and external) carry out the
related audits to the extent of their responsibilities.
Any failure to maintain adequate processes, as well
as adequate administrative-accounting and
De’Longhi Group
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04 Report on operations on separate financial statements 170
management controls, may result in erroneous fi-
nancial reporting.
In addition to financial reports, the Company also
prepares a Non-Financial Statement based on the
GRI-2021 principles and each year instructs the
branches as to which non-financial indicators
should be reported on.
B. Risks relating to the administrative liability of
legal: in compliance with EU directives, Decree
231/2001 has introduced into Italian law special
rules applying to the liability of entities for certain
offences, where “entities” mean limited liability
business enterprises, partnerships or associa-
tions, including those without legal status.
Under this legislation and amendments and addi-
tions thereto, the Company has adopted, in accord-
ance with art. 6 of Decree 231/2001, the “Model of
organization, management and control” suitable
for avoiding the occurrence of such liability at their
own expense and the related “Ethical code”, intend-
ed to apply not only to the Group’s Italian compa-
nies but also, as far as applicable, to its foreign
subsidiaries, since the Company is also answera-
ble, under art. 4 of Decree 231/2001, for offences
committed abroad.
Therefore, the company’s administrative liability
under Decree 231/2001 could exist when this is ef-
fectively established as a result of an action
brought against one of the Group companies, in-
cluding the foreign subsidiaries; in such a case, it is
not possible to exclude, in addition to the resulting
application of penalties, adverse consequences for
the Company’s operations, economic performance,
assets and liabilities and financial position.
7 - Related parties: the Company has had and
continues to have transactions of a commer-
cial nature with related parties. Such trans-
actions carry conditions that are in line with
market ones.
The Company adopted a new set of procedures to
govern transactions with related parties, in compli-
ance with the standards set by the supervisory au-
thorities in CONSOB Regulation 17221 dated 12
March 2010.
The procedures identify those related party trans-
actions subject to specific examination and ap-
proval rules, which change according to whether
such transactions are above or below defined
thresholds. The procedures place particular impor-
tance on the role of the independent directors, who
must always issue a prior opinion on the proposed
transaction (if the transaction qualifies as material,
this opinion is binding on the Board of Directors);
the independent directors must also be involved in
the preliminary examination of material transac-
tions prior to their approval.
These procedures are considered to represent an
additional guarantee of the transparency of the
Company’s operations.
Information on related party transactions is sum-
marized in Appendix 4 to the Explanatory Notes.
More information about the company’s risk man-
agement can be found in the Explanatory notes.
De’Longhi Group
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04 Report on operations on separate financial statements 171
Number
and value of shares
At 31 December 2023 share capital comprised 151,060,000 ordinary shares with a par value €1.5 each, for a
total of €226,590 thousand.
Treasury shares
At 31 December 2023 the Company had 595,000 treasury shares for a total of €9,658 thousand, purchased
in previous years; the difference with respect to 31 December 2022 (895,350 shares for €14,534 thousand)
is explained by the exercise of 300,350 options relative to the “2020-2027 Stock Option Plan”.
During the Shareholders’ Meeting held on 21 April 2023, shareholders approved the renewal - after revoking
the previous authorization granted by shareholders - of the authorization to purchase and sell treasury
shares for up to a maximum of 14.5 million ordinary shares or for an amount which does not exceed one
fifth of the share capital, including any shares held by the Company or any of its subsidiaries. The buyback
program was approved, in accordance with the law, for a period of up to a maximum of 18 months (namely
through 21 October 2024).
De’Longhi Group
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04 Report on operations on separate financial statements 172
Tax consolidation
The Company exercised, jointly with the consolidator De Longhi Industrial S.A., the option to adhere to group
taxation, referred to as “Domestic Tax Consolidation”, as permitted under articles 117 - 129 of the Consoli-
dated Income Tax Act (TUIR) as per Presidential Decree n. 917 of 22 December 1986, and the Decree of the
Ministry of Economy and Finance of 1 March 2018, for the three-year period 2022-2024.
Related
party transactions
Related party transactions fall within the normal course of the company business.
Information on related party transactions is summarized in Appendix 4 to the Explanatory Notes.
De’Longhi Group
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04 Report on operations on separate financial statements 173
Alternative performance
indicators
In addition to the information required by IFRS, this
document presents other financial measures
which provide further analysis of the Company’s
performance. These indicators must not be treated
as alternatives to those required by IFRS.
More in detail, the non-GAAP measures used
include:
• EBITDA: the Company uses these measure as
financial targets in internal presentations (busi-
ness plans) and in external presentations (to an-
alysts and investors), since it is a useful way of
measuring operating performance besides EBIT.
EBITDA is an intermediate measure that derives
from EBIT after adding back depreciation, amor-
tization of property, plant and equipment and in-
tangible assets. EBITDA is also presented net of
non-recurring items, which are reported sepa-
rately on the face of the income statement.
• Net working capital: this measure is the sum of
inventories, trade receivables, current tax assets
and other receivables, minus trade payables, cur-
rent tax liabilities and other payables.
• Net capital employed: this measure is the sum
of net working capital, intangible assets, proper-
ty, plant and equipment, equity investments,
other non-current receivables, and deferred tax
assets, minus deferred tax liabilities, employee
severance indemnity and provisions for contin-
gencies and other charges.
• Net financial debt/(Positive net financial posi-
tion): this measure represents gross financial li-
abilities less cash and cash equivalents and
other financial receivables; the net financial posi-
tion with banks, net non-banking items, is also
reported. The individual line items in the state-
ment of financial position used to determine this
measure are analysed later in this report.
The figures contained in the present document, in-
cluding some of the percentages, have been round-
ed relative to their full Euro amount. As a result,
some of the totals in the tables may differ from the
sum of the individual amounts presented.
De’Longhi Group
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04 Report on operations on separate financial statements 174
Non-financial
statement
Based on Legislative Decree n.254/2016, in implementation of the Directive 95/2014 or “Barnier Directive”,
large public interest undertakings are required to publish a Non-Financial Statement (NFS) as of FY 2017.
For further information refer to the Consolidated Annual Report on Operations.
Subsequent events
On 27 February 2024 the Group finalized the agreements for a business combination between Eversys (a lead-
ing company in the production and distribution of automatic coffee machines) and La Marzocco (a leading
company in the production and distribution of semi-automatic coffee machines and coffee grinders). For fur-
ther information on the purpose and structure of the transaction refer to the Report on Operations included in
the Annual Report.
The De’ Longhi Group’s total net cash out for the transaction reached approximately US$ 373 million, including
the US$ 200 million paid to De Longhi Industrial S.A. (for the 22% stake in La Marzocco) and US$ 173 million
for the purchase of shares from La Marzocco’s minority shareholders (for the 19.1% stake in La Marzocco).
This amount was totally self-financed.
With the exception of the above, after 31 December 2023 through the date on which this annual report was
approved, no events occurred that would have had a significant impact on financial and economic results re-
corded, as per IAS 10 - Events after the reporting period.
De’Longhi Group
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04 Report on operations on separate financial statements 175
Proposed resolutions for
the Annual General Meeting
1) Proposed resolution relating to item 1 of the
Agenda for the Annual General Meeting convened
on 19 April 2024 (“Approval of the separate finan-
cial statements at 31 December 2023, together
with the Directors’ Report on Operations, the Board
of Statutory Auditors’ Report and the External Au-
ditors’ Report. Presentation of the Consolidated
Annual Report at 31 December 2023. Presentation
of the Legislative Decree 254/16 Consolidated
Non-Financial Statement. Related and consequent
resolutions”).
Dear Shareholders,
in submitting the Annual Report at 31 December
2023 to you for approval during the Annual General
Meeting, we propose that you approve the follow-
ing resolution:
“The shareholders of De’ Longhi S.p.A.,
having examined the draft separate financial state-
ments at 31 December 2023 of De’ Longhi S.p.A., the
Board of Directors’ Report on Operations, the Board
of Statutory Auditors’ Report and the other docu-
mentation called for under the law
resolve
to approve the Directors’ Report on Operations and
the separate financial statements at 31 December
2023 of De’ Longhi S.p.A.”.
2) Proposed resolution relating to item 2 of the
Agenda for the Annual General Meeting convened
on 19 April 2024 (“Proposed allocation of the net
profit for the year. Related and consequent
resolutions”).
Dear Shareholders,
with regard to the allocation of the net profit for the
year closed on 31 December 2023, which amount-
ed to €36,578,046, we propose that you approve
the following resolution:
“The shareholders of De’ Longhi S.p.A., having ac-
knowledged the net profit for the year shown in the
separate financial statements at 31 December 2023
and the Directors’ Report on Operations
resolve
1. to distribute a gross ordinary dividend of €0.67
for each of the outstanding shares with dividend
rights at the record date, as per art. 83-terdecies
of Legislative Decree 58/98;
2. to use the net earnings shown in the separate fi-
nancial statements at 31 December 2023 for the
purposes of 1) above and to use the extraordi-
nary reserve to cover any differences;
3. to establish a record date of 21 May 2024, pursu-
ant to art. 83-terdecies of Legislative Decree n.
58/98, and that the dividend will be paid on each
share with dividend rights as from 22 May 2024,
with shares going ex-div on 20 May, in accord-
ance with Borsa Italiana’s calendar”.
Treviso, 12 March 2024
On behalf of the Board of Directors
Vice Chairman and Chief Executive Officer
Fabio de’ Longhi
Separate annual report
and financial statements
De’ Longhi S.p.A. - Separate financial
statements:
Income statement
Statement of comprehensive income
Statement of financial position
Statement of cash flow
Statement of changes in net equity
De’Longhi Group
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05 Separate annual report and financial statements 177
Income statement
(Euro) Notes 2023 of which non-recurring 2022 of which non-recurring
Other revenues 1 15,156,740 12,667,489
Total revenues 15,156,740 12,667,489
Raw and ancillary materials, consumables and goods 2 (60,896) (67,480)
Materials consumed (60,896) (67,480)
Payroll costs 3 (13,486,860) (7,846,428)
Services and other operating expenses 4 (23,411,747) (4,551,768) (18,842,222)
Provisions 5 (492,323) (492,323) -
Amortization 6 (424,843) (392,120)
EBIT (22,719,929) (14,480,761)
Net financial income (expenses) 7 55,962,847 121,092,914
Profit (loss) before taxes 33,242,918 106,612,153
Taxes 8 3,335,128 (5,804,087)
Profit (loss) 36,578,046 100,808,066
Appendix 4 reports the effect of related-party transactions on the income statement, as required by CONSOB resolution 15519 of 27 July 2006.
De’Longhi Group
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05 Separate annual report and financial statements 178
Statement of
comprehensive income
(Euro) 2023 2022
Profit (loss) 36,578,046 100,808,066
Other components of the comprehensive income:
Change in fair value of cash flow hedges 1,924,040 3,399,806
Tax effect on change in fair value of cash flow hedges and financial assets available for sale (461,770) (815,953)
Total other comprehensive income will subsequently be reclassified to profit (loss) for the year 1,462,270 2,583,853
Actuarial valuation funds (7,010) 51,366
Tax effect of actuarial valuation funds 1,682 (12,328)
Total other comprehensive income will not subsequently be reclassified to profit (loss) for the year (5,328) 39,038
Total components of comprehensive income 1,456,943 2,622,891
Total comprehensive income 38,034,989 103,430,957
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05 Separate annual report and financial statements 179
Statement of financial
position
ASSETS
(Euro)
Notes 31.12.2023 31.12.2022
Non-current assets
Intangible assets 31,107 64,753
- Other intangible assets 9 31,107 64,753
Property, plant and equipment 995,481 1,107,229
- Other tangible assets 10 60,828 111,275
- Right of use assets 11 934,653 995,954
Equity investments and other financial assets 615,636,775 569,636,587
- Equity investments 12 615,516,129 567,516,127
- Receivables 13 120,646 100,372
- Other non-current financial assets 14 - 2,020,088
Total non-current assets 616,663,363 570,808,569
Current assets
Trade receivables 15 12,499,455 1,219,377
Current tax assets 16 205 483,234
Other receivables 17 14,534,902 7,613,333
Current financial receivables and assets 18 661,487,232 861,910,713
Cash and cash equivalents 19 1,631,063 2,470,208
Total current assets 690,152,857 873,696,865
Total assets 1,306,816,220 1,444,505,434
Appendix 4 reports the effect of related-party transactions on the statement of financial position, as required by CONSOB resolution 15519 of 27 July 2006.
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05 Separate annual report and financial statements 180
NET EQUITY AND LIABILITIES
(Euro)
Notes 31.12.2023 31.12.2022
Net equity
- Share Capital 22 226,590,000 226,590,000
- Reserves 23 294,401,087 261,132,529
- Profit (loss) 36,578,046 100,808,066
Net equity 557,569,133 588,530,595
Non-current liabilities
Financial payables 516,039,747 714,301,106
- Banks loans and borrowings (long-term portion) 24 300,843,641 477,581,507
- Other financial payables (long-term portion) 25 214,616,898 236,026,199
- Lease liabilities (long-term portion) 11 579,208 693,400
Deferred tax liabilities 26 2,712,168 13,300,309
Non-current provisions for contingencies and other charges 6,795,215 3,604,485
- Employee benefits 27 6,302,892 3,604,485
- Other provisions 28 492,323 -
Total non-current liabilities 525,547,130 731,205,900
Current liabilities
Trade payables 29 11,677,258 7,600,488
Financial payables 202,080,685 110,090,798
- Banks loans and borrowings (short-term portion) 24 180,236,756 87,916,257
- Other financial payables (short-term portion) 25 21,491,244 21,870,165
- Lease liabilities (short-term portion) 11 352,685 304,376
Current tax liabilities 30 35,242 -
Other payables 31 9,906,772 7,077,653
Total current liabilities 223,699,957 124,768,939
Total net equity and liabilities 1,306,816,220 1,444,505,434
Appendix 4 reports the effect of related-party transactions on the statement of financial position, as required by CONSOB resolution 15519 of 27 July 2006.
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05 Separate annual report and financial statements 181
Statement of cash flow
(Euro) Notes 2023 2022
Profit (loss) 36,578,045 100,808,066
Income taxes for the period (3,335,128) 5,804,087
Income from dividends receipt (51,922,552) (132,947,008)
Amortization 424,843 392,120
Net change in provisions and other non-cash items 4,089,124 (1,355,653)
Cash flow absorbed by current operations (A) (14,165,668) (27,298,388)
Change in assets and liabilities for the period:
Trade receivables (11,280,078) 51,726
Trade payables 4,076,770 1,735,663
Other changes in net working capital (392,804) 4,708,928
Payment of income taxes (9,972,483) -
Cash flow generated (absorbed) by movements in working capital (B) (17,568,595) 6,496,317
Cash flow generated by current operations and movements in working capital (A+B) (31,734,263) (20,802,071)
Investment activities:
Investments in property, plant and equipment (21,803) -
Other cash flows for property, plant and equipment 27,462 -
Net equity investments and other financial assets (48,000,000) -
Dividends collection 51,922,552 132,947,008
Cash flow absorbed by investment activities (C) 3,928,211 132,947,008
Cash flow by operating activities (A+B+C) (27,806,052) 112,144,937
Exercise of stock option 5,100,544 3,353,361
Dividends paid (72,429,271) (124,636,775)
New loans - 200,000,000
Payment of interests on loans (22,327,436) (6,333,818)
Repayment of loans and other net changes in sources of finance 116,623,070 (202,524,493)
Cash flow generated (absorbed) by changes in net equity and by financing activities
(D)
26,966,907 (130,141,725)
Cash flow for the period (A+B+C+D) (839,145) (17,996,788)
Opening cash and cash equivalents 19 2,470,208 20,466,996
Cash flow for the period (A+B+C+D) (839,145) (17,996,788)
Closing cash and cash equivalents 19 1,631,063 2,470,208
Appendix 2 reports the statement of cash flows in terms of the net financial position.
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05 Separate annual report and financial statements 182
Statement of changes
in net equity
(Euro) Share capital
Share
Premium
Reserve
Legal reserve
Extraordinary
reserve
Treasury
shares
reserves
Cash flow
hedge
reserves
Stock option
reserve
Actuarial
evaluation
reserve
Profit (loss)
carried
forward
Profit (loss)
Total net
equity
Balance at 31 December 2021 226,344,138 34,299,938 45,167,569 188,113,630 (14,533,855) 93,510 8,488,867 (134,419) 10,441,324 107,098,783 605,379,485
Allocation of 2021 result as per AGM
resolution of 20 April 2022
- allocation to reserves 101,259 (101,259) -
- distribution of dividends (17,503,092) (106,997,524) (124,500,616)
Fair value stock option 867,408 867,408
Exercise/cancellation of stock option 245,862 3,967,819 2,122,890 (2,983,210) 3,353,361
Movements from transactions with
shareholders
245,862 3,967,819 101,259 (15,380,202) - - (2,115,802) - - (107,098,783) (120,279,847)
Profit (loss) after taxes 100,808,066 100,808,066
Other components of comprehensive
income
2,583,853 39,038 2,622,891
Comprehensive income (loss) - - - - - 2,583,853 - 39,038 - 100,808,066 103,430,957
Balance at 31 December 2022 226,590,000 38,267,757 45,268,828 172,733,428 (14,533,855) 2,677,363 6,373,065 (95,381) 10,441,324 100,808,066 588,530,595
Balance at 31 December 2022 226,590,000 38,267,757 45,268,828 172,733,428 (14,533,855) 2,677,363 6,373,065 (95,381) 10,441,324 100,808,066 588,530,595
Allocation of 2022 result as per AGM
resolution of 21 April 2023
- allocation to reserves 49,172 28,679,862 (28,729,034) -
- distribution of dividends (72,079,032) (72,079,032)
Fair value stock option 906,578 906,578
Exercise/cancellation of stock option 1,810,126 4,875,461 (1,585,044) 5,100,543
Movements from transactions with
shareholders
- 1,810,126 49,172 28,679,862 4,875,461 - (678,466) - - (100,808,066) (66,071,911)
Profit (loss) after taxes 36,578,046 36,578,046
Other components of comprehensive
income
(1,462,269) (5,328) (1,467,597)
Comprehensive income (loss) - - - - - (1,462,269) - (5,328) - 36,578,046 35,110,449
Balance at 31 December 2023 226,590,000 40,077,883 45,318,000 201,413,290 (9,658,394) 1,215,094 5,694,599 (100,709) 10,441,324 36,578,046 557,569,133
Explanatory notes
Separate annual report
and financial
statements
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05 Separate annual report and financial statements 184
Explanatory notes
Company business
De’ Longhi S.p.A., a company with its registered
office in Treviso whose shares are listed on the Eu-
ronext Milan run by Borsa Italiana, is the parent com-
pany of the De’ Longhi Group and performs holding
company activities involving the management and
supply of centralized services to its subsidiaries and
the management of subsidiary undertakings.
Accounting standards
The financial statements of De’ Longhi S.p.A. at 31
December 2023 have been prepared on the basis
of the international accounting and financial report-
ing standards issued by the International Account-
ing Standards Board (IASB), including the SIC and
IFRIC interpretations, as endorsed by the European
Commission (at the date of 31 December 2023),
pursuant to EC Regulation 1606 of 19 July 2002.
The following documents have been used for inter-
pretation and application purposes even though
not endorsed by the European Commission:
• Framework for the Preparation and Presentation
of Financial Statements (issued by the IASB in
2001);
• Implementation Guidance, Basis for Conclu-
sions, IFRIC and other documents issued by the
IASB or IFRIC to complement the accounting
standards;
• Interpretations published by the Italian Accounting
Board relating to how to apply IAS/IFRS in Italy.
The accounting policies and measurement bases
used for preparing the financial statements at 31
December 2023 are the same as those used for
preparing the financial statements at 31 December
2022; the new amendments and accounting stand-
ards, described below, had no significant impacts
on the present financial statements.
The financial statements at 31 December 2023
comprise the income statement, the statement of
comprehensive income, the statement of financial
position, the statement of cash flows, the state-
ment of changes in net equity and these explanato-
ry notes.
The statement of financial position has been pre-
pared on a basis that distinguishes between cur-
rent and non-current items.
The income statement has been presented on the
basis of the nature of expense, being a suitable
structure for faithfully representing the Company’s
performance.
The statement of cash flows has been prepared
using the “indirect method” allowed by IAS 7.
The present financial statements and notes are
presented in Euro (the Company’s functional cur-
rency) with all amounts in financial statements pre-
sented in Euro, as required by the Italian Civil Code,
while amounts in explanatory notes are rounded to
thousands of Euro, unless otherwise indicated.
The financial statements have been prepared in ac-
cordance with the historic cost principle, adjusted
as needed for the valuation of a few financial
instruments and under the assumption of going
concern. Despite the considerable uncertainty
stemming from the unpredictability as to the poten-
tial impact that the conflict in Ukraine and the infla-
tionary pressures might have, in light of its financial
solidity, the actions undertaken to mitigate risk and
its business model, the Company believes that
there are no elements which could compromise the
business as a going concern as per paragraph 25
of IAS 1.
The risks and uncertainties relating to the business
are described in a specific section of the Report on
operations. The methods used by the company to
manage financial risks are described in note 35.
Risk management of the present Explanatory
notes.
International accounting standards adopted
by the Company for the first time
With Regulation 2036/2021 of 19 November 2021
(and subsequent Regulations 1491/2022 of 8 Sep-
tember 2022 and 1083/2023 of 13 August 2023)
the European Commission adopted IFRS 17 - Insur-
ance contracts which will substitute IFRS 4. The
new standard, which establishes rules for the rec-
ognition, measurement, presentation and disclo-
sure of insurance contracts, will be applied to all in-
surance contracts issued by an entity (with limited
exceptions). The new provisions did not impact this
annual report.
Regulation 357/2022 of 2 March 2022, introduced
a few amendments to IAS 1 - Presentation of finan-
cial statement and to IAS 8 - Accounting Policies,
Changes in Accounting Estimates and Errors in
order to improve the disclosure of accounting poli-
cies and provide investors and other primary users
of the financial statements with more useful infor-
mation, as well as help companies to distinguish
the changes in accounting estimates from the
changes in accounting policy. These changes did
not impact the measurement or presentation of el-
ements in this annual report.
In Regulation 1392/2022 of 11 August 2022, the
European Commission introduced amendments to
Deferred Tax related to Assets and Liabilities arising
from a Single Transaction - Amendments to IAS 12
in order to clarify the accounting of deferred tax
recognized in particular circumstances such as, for
example, in the case of leasing and decommission-
ing obligations. These amendments clarify that a
temporary difference deriving from recognition of
an asset and a liability is not exempt from IAS 12
application if the transaction results in differences
in taxable income and deductibles of the same
amount. The application of the Amendments to IAS
12 did not impact this annual report, it only increas-
es the mandatory disclosure related to the recogni-
tion of deferred tax assets and liabilities in specific
cases like leasing; for further information refer to
note 26. Deferred tax liabilities found in these ex-
planatory notes.
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05 Separate annual report and financial statements 185
International financial reporting standards
and/or not yet applicable
On 22 December 2022 “Council Directive (EU)
2022/2523 on ensuring a global minimum level of
taxation for multinational enterprise groups and
large-scale domestic groups in the Union” was pub-
lished in the Gazzetta Ufficiale. The Directive was
endorsed by member states by year-end 2023, as
part of a coordinated effort, in accordance with the
different domestic tax regimes.
At the same time, the IASB launched a project to
revise IAS 12 which resulted in the publication of an
amendment, namely “International Tax Reform -
Pillar 2 Model Rules”.
The two documents are part of an ongoing debate
about the reform of the international tax system un-
dertaken by the Organization for Economic Coopera-
tion and Development (OECD). The reform calls for a
solution based on the two pillars (the two-pillar solu-
tion). Pillar 1 focuses on a tax model which aims to
reexamine the traditional concepts of “residence”
and “jurisdiction”. Pillar 2 aims to limit tax arbitrage in
the allocation of income by imposing a minimum tax
rate of 15% (Global anti-Base Erosion Rules, GloBE)
on multinational companies.
The Amendment to IAS12 introduces a temporary
exception to recognition of deferred taxes connect-
ed to the application of Pillar 2.
More in detail, the amendment introduces:
• a temporary exception to the accounting for de-
ferred taxes arising from the jurisdictional imple-
mentation of the global tax measures. This helps
to guarantee consistency in financial reports,
while also facilitating implementation of the
rules; and
• specific disclosure requirements for affected en-
tities to help users of the financial statements
better understand an entity’s exposure to income
taxes arising from the reform, particularly before
its effective date.
The amendment is applicable as of the year begin-
ning 1 January 2023 (but not for interim periods
which close by 31 December 2023).
The Company applied the temporary exception to
the accounting of deferred assets called for in IAS
12; consequently, information regarding the de-
ferred tax assets and liabilities relating to Pillar 2
income tax was not recorded nor reported.
The Company also carried out a preliminary as-
sessment based on the provisions of the Transi-
tional CbCR Safe Harbour (TSH) and other guide-
lines which are currently available.
Toward this end, this preliminary assessment
needs to be confirmed in light of the interpretations
and clarifications that OECD, union and/or domes-
tic legislatures issue and/or publish in the future.
As the assessment was merely a preliminary over-
view, the concrete impact that Pillar 2 might have
had on the Company’s results, if it had been effec-
tive for the year ending 31 December 2023, could
have been significantly different.
The Company continues to assess the impact that
the law on Pillar 2 income tax will have on its future
results.
With Regulation 2579/2023 of 20 November 2023
the European Commission introduced amend-
ments to IFRS 16 - Leases which clarify how to ac-
count for sale and leaseback transactions.
Regulation 2822/2023 of 19 December 2023 intro-
duced amendments to IAS 1 - Presentation of
financial statement which aim to improve disclo-
sure when the right to defer settlement of a liability
for at least twelve months is subject to a covenant.
In both instances, the new provisions are applica-
ble as from 1 January 2024.
The reporting standards and/or interpretations not
yet endorsed by the European Union include
amendments to IAS 1 - Presentation of financial
statements which aim to clarify how an entity
should classify debt and other financial liabilities as
current or non-current, and the amendments to IAS
7 and IFRS 7 which expand disclosures relative to
supplier finance agreements.
Disclosure by operating segments
Segment information is reported only with refer-
ence to the consolidated financial statements, as
allowed by IFRS 8.
Principal accounting policies
Intangible assets
Other intangible assets
Other intangible assets purchased or internally
generated are recognized as assets in accordance
with IAS 38 Intangible assets, when it is probable
that the future economic benefits attributable to
their use will flow to the company and when the
cost of the asset can be reliably measured.
These assets are valued at purchase or production
cost and amortized, if they have a finite life, on a
straight-line basis over their useful life, generally
estimated in 4 years.
Property, plant and equipment
Land, property, plant and machinery
Property, plant and equipment owned by the Com-
pany are recorded at purchase or production cost
and systematically depreciated over their residual
useful lives.
The cost of assets qualifying for capitalization also
includes the borrowing costs directly attributable to
the acquisition, construction or production of the
asset itself.
Subsequent expenditure is capitalized only if it in-
creases the future economic benefits flowing to the
enterprise.
Ordinary and/or routine maintenance and repair
costs are directly expensed to the income state-
ment when incurred. Costs relating to the expan-
sion, modernization or improvement of owned or
leased assets are capitalized to the extent that they
qualify for separate classification as an asset or
part of an asset under the component approach,
whereby every component whose useful life and
related value can be autonomously assessed must
be treated individually.
All other costs are expensed to income as
incurred.
The useful lives, estimated by the Company for its
various categories of property, plant and equip-
ment, are as follows:
Other 4-8 years
Right-of-use assets
In accordance with IFRS 16 the right-of-use asset is
De’Longhi Group
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05 Separate annual report and financial statements 186
valued at cost plus the present value of future pay-
ments (discounted at the incremental borrowing
rate, namely the interest rate that the lessee must
pay over the term of the loan and similar guaran-
tees), the initial costs incurred directly by the
lessee, and any advance lease payments made.
The asset value is systematically depreciated.
Impairment of non-financial assets
The Company tests, at least once a year, whether
the book value of intangible assets and property,
plant and equipment reported in the financial state-
ments has suffered any impairment loss. If there is
evidence of impairment, book value is written down
to the related recoverable amount.
If it is not possible to estimate the recoverable
amount of an individual asset, the Company as-
sesses whether the cash-generating unit to which it
belongs is impaired.
Financial instruments
Financial assets
Upon initial recognition, financial assets are classi-
fied based on the measurement methods used in
one of the three categories found in IFRS 9. The
classification depends on the nature of the contrac-
tual cash flows and the business model the com-
pany uses to manage them.
The business model refers to the way in which the
cash flows are generated which can be from the
collection of contractual cash flows, the sale of
assets or both.
A financial asset is classified among the assets
valued at amortized cost if held as part of a busi-
ness model where the objective is collecting con-
tractual cash flows represented solely by payments
to be made on certain dates, principal and interest.
The valuation is made based on the effective inter-
est rate.
A financial asset is classified among the assets
valued at fair value with changes passing through
the comprehensive income statement if held as
part of a business model where the objective is col-
lecting contractual cash flows and selling the
assets and the cash flows contemplated under the
contract refer solely to payments of principal and
interest made on predetermined dates. For the
assets included in this category, the interest receiv-
able, the foreign exchange differences and losses
in value are recognized in the income statement for
the reporting period; other changes in fair value are
recognized in the comprehensive income state-
ment. Upon elimination, the cumulative change in
fair value recognized as other comprehensive
income is released to the income statement.
During the initial recognition phase, equity instru-
ments may be included in the category of assets
measured at fair value with changes recognized in
the comprehensive income statement.
The category of assets valued at fair value with
changes recognized in the income statement in-
clude assets held for trading, namely acquired to be
sold in the short-term, and the assets designated
as such.
Upon initial recognition, equity instruments not
held for trading may be included in the category of
financial instruments measured at fair value with
changes recognized in the comprehensive income
statement. This choice may be made for each
asset and is irrevocable.
The trade receivables without a significant financ-
ing component are valued at the transaction price
determined in accordance with IFRS 15.
Financial liabilities
Financial liabilities refer mainly to loans valued at
amortized cost based on the effective interest rate.
Financial liabilities are derecognized when the un-
derlying obligation is extinguished, cancelled or
fulfilled.
Lease liabilities
Lease liabilities equal the present value of the pay-
ments payable and not yet paid at the date of the
financial statements discounted at the interest rate
implicit in the lease, if easily determined, or alterna-
tively, at the incremental borrowing rate which is
the rate that the lessee would pay on a loan with a
similar duration and conditions. In the event the
lease term, purchase options, the residual value
guaranteed, or variable payments based on indices
or rates, are redetermined, the lease liability is
restated.
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05 Separate annual report and financial statements 187
Derivatives
Derivatives are used solely for hedging purposes, in
order to reduce exposures to currency and interest
rate risk. As allowed by IFRS 9, derivatives may
qualify for special hedge accounting only when, at
the inception of the hedge, the following conditions
are satisfied:
• there is a formal designation that the instrument
is a hedging one;
• there is formal documentation of the hedging re-
lationship, which is expected to be highly
effective;
• the effectiveness of the hedge can be reliably
measured;
• the hedge is highly effective throughout the dif-
ferent financial reporting periods for which it was
designated.
In accordance with IFRS 9, all derivatives are meas-
ured at fair value.
If financial instruments qualify for hedge account-
ing, the following treatment applies:
Fair value hedge - If a derivative instrument is des-
ignated as a hedge of the exposure to changes in
the fair value of a recognized asset or liability that is
attributable to a particular risk that will affect profit
or loss, the gain or loss from remeasuring the hedg-
ing instrument at fair value should be recognized in
the income statement. The gain or loss on the
hedged item attributable to the hedged risk adjusts
the carrying amount of the hedged item and is rec-
ognized in the income statement.
Cash flow hedge - If a derivative instrument is des-
ignated as a hedge of the exposure to variability in
cash flows attributable to a highly probable fore-
cast transaction which could affect profit or loss,
the effective portion of the gains or losses on the
hedging instrument is recognized directly in the
statement of comprehensive income. The effective
portion of the cumulative gains or losses are re-
versed from net equity and reclassified to profit or
loss in the same period in which the hedged trans-
action is reported in the income statement. Gains
or losses associated with a hedge or part thereof
that has become ineffective are reclassified to the
income statement. If a hedging instrument or
hedging relationship is terminated, but the transac-
tion being hedged has not yet occurred, the cumu-
lative gains and losses, recorded up until then in the
statement of comprehensive income, are reported
in the income statement at the same time that the
hedged transaction occurs. If the hedged transac-
tion is no longer expected to occur, the unrealized
gains or losses reported directly in net equity are
immediately reclassified to the income statement.
If hedge accounting cannot be applied, the gains or
losses arising from the fair value measurement of
the derivatives are transferred immediately to the
income statement.
Employee benefit
Pension and other incentive plans
Net obligations relating to employee benefit plans,
chiefly the provision for severance indemnities (for
the portion retained in the company) and pension
funds, are recorded at the expected future value of
the benefits that will be received and which have
accrued at the reporting date. The Company’s obli-
gation to finance defined benefit pension funds and
the annual cost reported in the income statement
are determined by independent actuaries using the
projected unit credit method.
Equity based compensation
The Company grants additional benefits to the Chief
Executive Officer, a limited number of executives
and key resources under the form of stock options.
Based on IFRS 2 Share-based payment, the current
value of the stock option determined on the grant
date is recognized on a straight-line basis in the
income statement as a payroll cost in the period be-
tween the grant date and the date on which the
rights granted to employees, executives and others
who routinely provide services to one or more Group
companies parties fully vest, with a corresponding
increase in equity.
At each reporting date the Company will revise esti-
mates based on the number of options that are ex-
pected to vest, independent of the fair value of the
options. Any differences with respect to the original
estimates will be recognized in the income state-
ment with a corresponding increase in equity.
Once the stock option is exercised, the amounts re-
ceived by the employee, net of transactions costs,
will be added to the share capital in the amount of
the nominal value of the shares issues. The remain-
der will be recognized in the share premium reserve.
The fair value of the stock options is determined
using the Black-Scholes model which takes into ac-
count the conditions for the exercise of the right, the
current share price, expected volatility, a risk free in-
terest rate, as well as the non-vesting conditions.
The fair value of the stock options is included within
the Stock option Reserve.
The dilutive effect of unexercised options will be re-
flected in the calculation of the diluted earnings per
share.
Provisions for contingencies and other charges
The Company recognizes provisions for contingen-
cies and charges when (i) it has a present obligation
(legal or constructive) to third parties (ii) it is proba-
ble that the company will need to employ resources
to settle the obligation and (iii) a reliable estimate
can be made of the amount of the obligation.
Changes in these estimates are reflected in the
income statement in the period in which they occur
(also see the comments in the paragraph on “Esti-
mates and assumptions”).
Where the effect of the time value of money is mate-
rial and the date of extinguishing the liability can be
reasonably estimated, provisions are stated at the
present value of the expected expenditure, using a
discount rate that reflects current market assess-
ments of the time value of money and the risks spe-
cific to the liability.
An increase in the amount of the provision for the
time value of money is accounted for in interest ex-
pense. Contingencies for which the probability of a
liability is remote are disclosed in the notes but no
provision is recognized.
Recognition of revenues
The item “Revenues” includes the consideration re-
ceived for services rendered.
Revenues represent the consideration owed in ex-
change for the transfer of services to the customer,
excluding amounts received on behalf of third par-
ties. The Company recognizes the revenue when
contractual obligations are fulfilled, namely when
control of the service is transferred to the
customer.
Based on the five-step model introduced in IFRS 15,
the Company recognizes revenue after the follow-
ing requirements have been met:
a. the parties have approved the contract (in writ-
ing, orally or in accordance with other common
commercial practices) and are committed to
fulfilling the respective performance obliga-
tions; an agreement between the parties which
creates rights and obligations regardless of the
form of the agreement has, therefore, been
created;
De’Longhi Group
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05 Separate annual report and financial statements 188
b. the rights of each of the parties in relation to the
services to be transferred can be identified;
c. the payment terms for the goods or services to
be transferred can be identified;
d. the contract has commercial substance;
e. it is probable that the Company will receive the
consideration to which it is entitled in exchange
for the services transferred to the customer.
If the consideration referred to in the contract has a
variable component, the Company will estimate the
amount of the consideration it will be entitled to in
exchange for the services transferred to the
customer.
Costs and expenses
Costs and expenses are accounted for on an accru-
al basis.
Dividends
Dividend distributions represent a movement in net
equity in the period in which they are declared by
the shareholders in general meeting.
Dividends received are reported when the Compa-
ny is entitled to receive the payment.
Income taxes
Income taxes include all the taxes calculated on the
Company’s taxable income. Income taxes are re-
corded in the income statement, except for those
relating to items directly debited or credited to net
equity, in which case the associated tax is recog-
nized directly in net equity.
Deferred taxes are provided on the basis of global
provision for the liability. They are calculated on all
the temporary differences emerging between the
tax base of an asset or liability and their book value,
except for differences arising from investments in
subsidiaries which are not expected to reverse in
the foreseeable future. Deferred tax assets on the
carry forward of unused tax losses and tax credits
are recognized to the extent that it is probable that
future taxable profit will be available against which
these can be recovered. Current and deferred tax
assets and liabilities may be offset when the
income taxes are charged by the same tax authori-
ty and when there is a legal right of set-off.
Deferred tax assets and liabilities are calculated at
the tax rates that are expected to apply to the
period when the asset is realized or the liability
settled.
Deferred taxes on reserves of distributable earn-
ings in subsidiaries are recognized only if it is prob-
able that such reserves will be distributed.
Any uncertainty regarding tax treatments is consid-
ered in the tax calculation in accordance with the
recommendations of IFRIC 23 Uncertainty over
Income Tax Treatments.
Estimates and assumptions
These financial statements, prepared in accord-
ance with IFRS, contain estimates and assump-
tions made by the Company relating to assets and
liabilities, costs, revenues and contingent liabilities
at the reporting date. These estimates are based
on past experience and assumptions considered to
be reasonable and realistic, based on the informa-
tion available at the time of making the estimate.
The assumptions relating to these estimates are
periodically reviewed and the related effects re-
flected in the income statement in the same period;
actual results could therefore differ from these
estimates.
The following paragraphs discuss the principal as-
sumptions used for estimation purposes and the
principal sources of uncertainty, that have a risk of
causing material adjustment to the book value of
assets and liabilities in the future; details of book
value can be found in the individual explanatory
notes.
Employee benefits
The cost of defined benefit pension plans is deter-
mined using actuarial valuations, based on statisti-
cal assumptions regarding discount rates, expect-
ed returns on investments, future salary growth
and mortality rates.
The Company believes the rates estimated by its
actuaries to be reasonable for the year-end valua-
tions, but cannot rule out that large future changes
in rates could have a material impact on the liabili-
ties recognized in the financial statements.
Recoverability of deferred tax assets
Deferred tax assets could include those relating to
carry forward tax losses to the extent that there is
likely to be sufficient future taxable profit against
which such losses can be recovered.
Management must use their discretion when deter-
mining the amount of deferred tax assets for rec-
ognition in the financial statements. They must es-
timate the likely timing of reversal and the amount
of future taxable profit, as well as the future tax
planning strategy.
Provisions for contingencies
The company makes several provisions against
disputes or risks of various kinds relating to differ-
ent matters falling under the jurisdiction of different
countries. The determination, probability and quan-
tification of these liabilities involve estimation pro-
cesses that are often very complex, for which man-
agement uses all the available information at the
date of preparing the financial statements, includ-
ing with the support of legal and tax advisors.
De’Longhi Group
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05 Separate annual report and financial statements 189
Comments on the income
statement
1. Revenues
Revenues refer mainly to chargebacks to subsidiaries for operating costs (payroll costs and the cost of ser-
vices) and financial expenses incurred which amounted to €15,073 thousand as shown in Appendix n. 4.
2. Raw and ancillary materials, consumables and goods
These are analyzed as follows:
2023 2022 Change
Other purchases 61 67 (6)
Total 61 67 (6)
3. Payroll costs
The figures relating to the provisions made by the Company relative to severance and long-term benefits are
summarized in note 27. Employee benefits.
This item includes the fair value of the stock option plan which amounted to €907 thousand in the reporting
period (€867 thousand at 31 December 2022); please refer to note 21. Stock option plans for more
information.
4. Services and other operating expenses
These are analyzed as follows:
2023 2022 Change
Consulting services 7,116 3,004 4,112
Insurance 4,457 4,072 385
Directors' emoluments 2,602 3,523 (921)
Global marketing costs 2,365 2,629 (264)
Travel 533 216 317
Statutory auditors' emoluments 166 161 5
Rentals and leasing 151 108 43
Telephone costs 36 33 3
ADV and Promotional expenses 16 6 10
Other sundry services 5,145 4,628 517
Total services 22,587 18,380 4,207
Sundry taxes 635 275 360
Other 190 187 3
Total other operating expenses 825 462 363
Services and other operating expenses 23,412 18,842 4,570
“Cost of services” includes the costs incurred by the Company to carry out its activities as a holding compa-
ny and a few centralized costs shared by several Group companies that are subsequently charged back to
the subsidiaries.
The item includes €4,552 thousand in net non-recurring expenses for consultancies related to the La Mar-
zocco business combination. For further information on the purpose and structure of the transaction refer
to the Report on Operations included in the Annual Report.
“Rentals and leasing” includes the operating costs for contracts that are not or do not contain leases (€139
thousand; €96 thousand at 31 December 2022), as well as the costs for leases of less than twelve months
(€12 thousand; €12 thousand at 31 December 2022); for more information, please refer to note 11. Leases.
De’Longhi Group
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05 Separate annual report and financial statements 190
“Services and other operating expenses” include €2,769 thousand in costs from related parties, as reported
in Appendix 4.
5. Provisions
“Provisions” include non-recurring reorganization costs.
6. Amortization
These are analyzed as follows:
2023 2022 Change
Amortization of intangible assets 34 37 (3)
Depreciation of property, plant and equipment 50 51 (1)
Depreciation of right of use assets 341 304 37
Total 425 392 33
For further information on amortization and depreciation, please see the tables showing changes in intangi-
ble assets, property, plant and equipment, and leases.
7. Financial income (expenses)
Net financial income and expenses are broken down as follows:
2023 2022 Change
Dividends 51,923 132,947 (81,024)
Incomes (expeses) from equity investments 51,923 132,947 (81,024)
Income (expenses) on exchange hedging
transactions
19 42 (23)
Exchange differences and gains (losses) on
currency hedges
(48) (41) (7)
Profits (losses) on net exchange rates (29) 1 (30)
Net interest on loans 26,087 3,517 22,570
Interests 2 4 (2)
Financial income 26,089 3,521 22,568
Interest on m/l term loans (17,979) (11,418) (6,561)
Interest expenses on bonds (3,392) (3,747) 355
Interest expenses on short-term loans and
borrowings
(1) (5) 4
Financial expenses (21,372) (15,170) (6,202)
Interest for leasing (13) (11) (2)
Other net financial income (expenses) (635) (195) (440)
Other net financial income (expenses) (648) (206) (442)
Net financial income (expenses) 55,963 121,093 (65.130)
“Financial income (expenses)” includes €77,959 thousand in income from related parties, as reported in
Appendix 4.
Dividends relate primarily to amounts declared by the subsidiaries De’ Longhi Appliances S.r.l., E-Services
S.r.l. and De’ Longhi Kenwood Gmbh.
The interest payable on loans includes the interest on the Company’s financial debt (recalculated using the
amortized cost method).
For more information on leases, please see note 11. Leases.
De’Longhi Group
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05 Separate annual report and financial statements 191
8. Income taxes
These are analyzed as follows:
2023 2022 Change
Current taxes (6,790) 5,470 (12,260)
Advanced (deferred) taxes 10,125 (11,274) 21,399
Total 3,335 (5,804) 9,139
The Company exercised, jointly with the consolidator De Longhi Industrial S.A., the option to adhere to “Do-
mestic Tax Consolidation”, as permitted under articles 117 et seq of Presidential Decree n. 917/86 for the
three-year period 2022-2024.
“Advanced (deferred) taxes” report the taxes calculated on the temporary differences arising between the
carrying amount of assets and liabilities and the corresponding tax base, and the distributable earnings of
subsidiaries. The item also includes the benefit from losses carried forward for tax purposes which may be
considered taxable income in the future, as well as the deferred liabilities recognized for €9.8 million stem-
ming from the possible release of distributable profit reserves of a few Group companies in accordance with
Law 197/2022. Taxes on these amounts were paid in 2023.
More information on deferred taxes can be found in note 26. Deferred tax liabilities.
Effective as from 1 January 2024, the De’ Longhi Group, a multinational enterprise group which, along with
its direct shareholder, exceeds the threshold of consolidated revenues of at least €750 million for two of the
four previous years, is subject to application of the Pillar 2 income tax called for in Directive 2022/2523,
adopted in Italy with Legislative Decree 209/2023, which aims to ensure a global minimum level of taxation
for multinational enterprise groups and large-scale domestic groups in the European Union.
Based on paragraph 4.A of IAS 12, which provides for a temporary exemption from provisions of this stand-
ard relative to the recognition and reporting of information on deferred assets and liabilities derived from
Pillar 2 application, in this annual report no Pillar 2 deferred tax assets or liabilities were recognized.
The actual and theoretical tax charge are reconciled here below.
As the Pillar 2 rules were not in effect at the closing date of the annual report, no current Pillar 2 taxes were
recognized.
2023 % 2022 %
Profit before taxes 33,243 100.0% 106,612 100.0%
Theoretical taxes (7,978) 24.0% (25,587) 24.0%
Permanent tax differences
(dividends, net of disallowable
costs) and other effects
11,313 34.0% 19,782 18.6%
Actual taxes 3,335 10.0% (5,804) (5.4%)
De’Longhi Group
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05 Separate annual report and financial statements 192
Comments on the statement
of financial position: assets
Non-current assets
9. Intangible assets
These are analyzed as follows:
31.12.2023 31.12.2022
Gross Net Gross Net
Patents 2,244 31 2,244 65
Total 2,244 31 2,244 65
The following table reports movements during 2023:
Patents
Net opening balance 65
Amortization (34)
Net closing balance 31
10. Other tangible assets
These are analyzed as follows:
31.12.2023 31.12.2022
Gross Net Gross Net
Industrial and commercial
equipment
19 - 19 -
Other 246 61 246 111
Total 265 61 265 111
The following table reports movements during 2023:
Other
Net opening balance 111
Additions 22
Disposals (22)
Amortization (50)
Net closing balance 61
11. Leasing
The Company’s current leases refer primarily to property and automobiles leased for operational purposes.
The right-of-use recognized for leased goods and the changes in 2023 are detailed below:
Land and buildings Other Total
Net opening balance 816 180 996
Additions 73 211 284
Disposals (4) - (4)
Amortization (240) (101) (341)
Net closing balance 645 290 935
In 2023, subsequent to the application of the IFRS 16 Leases, €341 thousand of depreciation were recog-
nized in the income statement and €13 thousand of interest payable and while € 359 thousand of costs
represented by the lease payments made were eliminated.
Financial liabilities for leases amounting to €932 thousand (of which €579 thousand expiring beyond 12
months) were recognized at 31 December 2023.
The financial liabilities for leases include amounts owed associates of €546 thousand (of which €329 thou-
sand expiring beyond 12 months) as shown in Appendix 4.
Other
De’Longhi Group
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05 Separate annual report and financial statements 193
The maturities of the undiscounted lease liabilities are shown below:
Undiscounted
flows at
31.12.2023
Payable within
one year
Payable in 1-5
years
Payable in more
than five years
Lease liabilities 960 367 593 -
12. Equity investments
These are analyzed as follows:
Equity investments in
subsidiary company
31.12.2023 31.12.2022 Change
De Longhi Benelux S.A. 314,737 266,737 48,000
De’Longhi Appliances S.r.l. 242,678 242,678 -
De’Longhi Deutschland GmbH 40,800 40,800 -
De’Longhi Capital Services S.r.l. 6,005 6,005 -
E-Services S.r.l. 5,264 5,264 -
De’Longhi Romania S.r.l. 3,078 3,078 -
De’Longhi Kenwood GmbH 2,900 2,900 -
Clim.Re S.A. 54 54 -
Total 615,516 567,516 48,000
The €48,000 thousand increase in this item is explained by the amount deposited in a capital account for the
subsidiary De Longhi Benelux S.A..
The list of equity investments is summarized in Appendix 3.
Equity investments in subsidiaries are recognized at the acquisition or formation cost.
The impairment test carried out has not revealed any significant evidence that equity investments are
impaired.
13. Non-current receivables
This balance is analyzed as follows:
31.12.2023 31.12.2022 Change
Receivables from subsidiaries 113 95 18
Guarantee deposit 7 5 2
Total 120 100 20
Appendix 4 contains details of “Receivables from subsidiary companies”.
14. Other non-current financial assets
Details are as follows:
31.12.2023 31.12.2022 Change
Fair value of derivatives - 2,020 (2,020)
Total - 2,020 (2,020)
More details on the fair value of derivatives can be found in note 35. Risk management.
De’Longhi Group
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05 Separate annual report and financial statements 194
Current assets
15. Trade receivables
These are analyzed as follows:
31.12.2023 31.12.2022 Change
Trade receivables within 12
months
12,499 1,219 11,280
Total 12,499 1,219 11,280
“Trade receivables” include €12,499 thousand in receivables from related parties, as reported in Appendix 4.
Trade receivables do not include any amounts due beyond 12 months.
16. Current tax assets
These are detailed as follows:
31.12.2023 31.12.2022 Change
Direct tax receivables - 483 (483)
Total - 483 (483)
In 2023 the Company exercised the option to adhere to “Domestic Tax Consolidation” as permitted under
Title II Section of Presidential Decree n. 917/86, in order to optimize the financial management of relation-
ships with the tax authorities.
17. Other receivables
These are analyzed as follows:
31.12.2023 31.12.2022 Change
Transfer of IRES credits for
the purposes of Domestic Tax
Consolidation
8,529 5,457 3,072
VAT 3,737 547 3,190
Prepaid insurance costs 1,294 1,218 76
Other 975 391 584
Total 14,535 7,613 6,922
In 2023 the Company exercised the option to adhere to “Group VAT liquidation” pursuant to Ministerial
Decree n. 13/12/1979; the item “VAT credits” reflects the relative credit.
“Other receivables” includes €9,039 thousand in amounts due from related parties, as reported in Appendix 4.
None of the other receivables is due beyond 12 months.
18. Current financial receivables and assets
These are analyzed as follows:
31.12.2023 31.12.2022 Change
Financial receivables 659,293 860,035 (200,742)
Fair value of derivatives 2,194 1,876 318
Total 661,487 861,911 (200,424)
“Financial receivables” refers to receivables to the subsidiary company De’ Longhi Capital Services S.r.l., re-
lating to the cash pooling agreement.
“Current financial receivables and assets” includes amounts payable by related parties of €659,293 thou-
sand, as reported in Appendix 4.
More details on the fair value of derivatives can be found in note 35. Risk management.
None of the current financial receivables is due beyond 12 months.
19. Cash and cash equivalents
This balance consists of surplus liquidity on bank current accounts.
De’Longhi Group
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05 Separate annual report and financial statements 195
Comments on the statement
of financial position: net equity
and liabilities
Net equity
The primary objective of the Company’s capital
management is to maintain a solid credit rating and
adequate capital ratios in order to support its busi-
ness and maximize value for shareholders.
On 21 April 2023 the Shareholders’ Meeting of De’
Longhi S.p.A. resolved to distribute dividends for a
total amount of €72,079 thousand, which were paid
in full during the year.
Movements in the equity accounts are reported in
one of the earlier schedules forming part of the fi-
nancial statements; comments on the main com-
ponents and their changes are provided below.
20. Treasury shares
At 31 December 2023 the Company had 595,000
treasury shares for a total of €9,658 thousand, pur-
chased in previous years; the change with respect to
31 December 2022 (895,350 for a total of €14,534
thousand) is explained by the exercise of 300,350
stock options relating to the “2020-2027 Stock Option
Plan”.
During the Shareholders’ Meeting held on 21 April
2023, shareholders approved the renewal - after re-
voking the previous authorization granted by share-
holders - of the authorization to purchase and sell
treasury shares for up to a maximum of 14.5 mil-
lion ordinary shares or for an amount which does
not exceed one fifth of the share capital, including
any shares held by the Company or any of its
subsidiaries.
beneficiaries, therefore, will not be expected to pay
any sort of consideration upon assignment. Con-
versely, exercise of the option and the resulting
subscription of the shares will be subject to pay-
ment of the exercise price.
Each option grants the right to subscribe one share
at the conditions set out in the relative regulations.
The exercise price shall be equal to the arithmetic
average of the official market price of the Compa-
ny’s shares recorded on the “Euronext Milan” man-
aged by Borsa Italiana S.p.A. 180 calendar days
prior to the date on which the 2020-2027 Plan and
the relative regulations were approved by share-
holders during the Annual General Meeting. This
period of time is sufficient to limit the impact that
any volatility caused by the Coronavirus crisis
could have on the stock price.
The options may be exercised by the Beneficiaries
- on one or more occasions - solely and exclusively
during the exercise period, namely during the fol-
lowing timeframes:
• between 15 May 2023 and 31 December 2027
for up to a total maximum amount equal to 50%
of the total options assigned each beneficiary,
without prejudice to the black-out periods re-
ferred to in Art. 12 of the Regulations;
• between 15 May 2024 and 31 December 2027
for the remaining 50% of the total options as-
signed each beneficiary, without prejudice to the
black-out periods referred to in Art. 12 of the
Regulations.
Any option not exercised by the end of the exercise
The authorization was approved for a period of up
to a maximum of 18 months (therefore, through 21
October 2024) in accordance with the law.
21. Stock option plans
At 31 December 2023 a share-based incentive plan
approved during De’ Longhi S.p.A.’s Annual General
Meeting held on 22 April 2020, the “Stock Option
Plan 2020-2027”, was in place.
In the face of the plan, the Shareholders’ Meeting
decided on a further increase in the share capital of
nominal maximums Euro 4,500,000 to be carried out
through the 3,000,000 ordinary shares, with a nomi-
nal value of Euro 1.5 each having the same charac-
teristics as ordinary shares outstanding on the date
of issue, with regular enjoyment, intended, if the
shares in the portfolio do not were capacious.
The aim of the plan is to encourage the loyalty of
the beneficiaries, encouraging their stay in the
Group, linking their remuneration to the implemen-
tation of the company strategy in the medium to
long term.
The overall duration of the plan is about 8 years and
in any case the deadline is set for 31 December
2027.
The beneficiaries were identified by the Board of
Directors based on the proposal of the Remunera-
tion and Appointments Committee or the Chief Ex-
ecutive Officer, after having consulted with the
Board of Statutory Auditors.
The options are granted free of charge: the
period will be automatically expire and the benefi-
ciary will have no right to any compensation or
indemnity.
All shares will have regular dividend rights and,
therefore, will be the same as all other shares out-
standing at their issue date, and will be freely trans-
ferrable by the beneficiary.
Please refer to the Annual Report on the Remunera-
tion Policy and Compensation Paid for more infor-
mation on the Plan.
At 31 December 2022 stock options on 1,560,000
shares had been assigned; during the year the total
fell to 1,089,650 shares as a result of the resigna-
tion of one of the eligible persons and for the exer-
cise of a total of 300,350 options.
For the purposes of valuation under IFRS 2 - Share-
based payments, two different tranches were de-
fined for each award which contain the same
number of options broken down equally into the
plan’s two exercise periods. The fair value of each
tranche is different.
The fair value of the stock options at the assign-
ment date is determined using the Black-Scholes
model which takes into account the conditions for
the exercise of the right, the current share price, ex-
pected volatility, a risk-free interest rate, as well as
the non-vesting conditions.
Volatility is estimated based on the data of a
market information provider and corresponds to
the estimated volatility of the stock over the life of
the plan.
The fair value of the options assigned on the date
De’Longhi Group
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05 Separate annual report and financial statements 196
of this Report and the assumptions made for its evaluation are as follows:
Award (05.04.2020) Award (05.14.2020) Award (05.15.2020) Award (05.20.2020) Award (11.05.2020)
First tranche fair value 4.43 4.59 4.46 4.46 12.40
Second tranche fair value 4.38 4.54 4.40 4.40 12.03
Expected dividends (Euro) 2.80% 2.80% 2.80% 2.80% 2.80%
Estimated volatility (%) 35.00% 34.00% 33.00% 32.00% 28.00%
Historic volatility (%) 37.00% 37.00% 37.00% 37.00% 37.00%
Market interest rate (0.2%) (0.2%) (0.2%) (0.2%) (0.2%)
Expected life of the options (years) 7.70 7.70 7.70 7.70 7.70
Exercise price (Euro) 16.98 16.98 16.98 16.98 16.98
22. Share capital
The share capital at 31 December 2023 comprised 151,060,000 ordinary shares with a par value of €1.5 for
a total of €226,590 thousand.
23. Reserves
These are analyzed as follows:
31.12.2023 31.12.2022 Change
Share premium reserve 40,078 38,268 1,810
Legal reserve 45,318 45,269 49
Other reserves:
- Extraordinary reserve 201,413 172,734 28,679
- Fair value and cash flow
hedge reserve
1,215 2,677 (1,462)
- Stock option reserve 5,695 6,373 (678)
- Reserve for treasury shares (9,658) (14,534) 4,876
- Actuarial valuation reserve (101) (95) (6)
Profit (Loss) carried forward 10,441 10,441 -
Total 294,401 261,133 33,268
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05 Separate annual report and financial statements 197
Following the IPO and subsequent listing on Milan’s MTA, today Euronext Milan, on 23 July 2001, a “Share
premium reserve” was constituted and subsequently reduced following the demerger of DeLclima S.p.A..
This reserve amounted to €38,268 thousand at 31 December 2022 after the exercise of options relating to
the “2016-2022 Stock Option Plan”. In 2023 the reserve rose €1,810 thousand to €40,078 thousand following
the exercise of 300,350 options under the “2020-2027 Stock Option Plan”.
The “Legal Reserve” amounted to €45,269 thousand at 31 December 2022. The increase of €49 thousand
follows the allocation of profit for 2022, as approved by the AGM on 21 April 2023.
The “Extraordinary Reserve” was increased by €28,679 thousand following allocation of the net earnings for
2022 as resolved by the Shareholders’ Meeting on 21 April 2023.
The “Fair value and cash flow hedge reserve” reports a balance of €1,215 thousand, net of €384 thousand in
tax. This amount reflects the fair value of the cash flow hedge derivatives.
More details on the fair value of derivatives can be found in note 35. Risk management.
The “Stock Option Reserve” at 31 December 2023 refers to the share-based incentive plan “Stock Option
Plan 2020-2027” already described in note 21. Stock Option Plans.
The “Stock Option Reserve” amounted to positive €5,695 thousand which corresponds to the fair value of
the options at the assignment date, recognized on a straight-line basis from the grant date through vesting.
In the year €907 thousand, which represents the fair value measurement of the options net the cancellation
of options due to a change in the number of beneficiaries, was allocated to the reserve.
“Reserve for treasury shares”, negative for €9,658 thousand, represents the value of the 595,000 treasury
shares purchased under the buyback program.
The change with respect to 31 December 2022 refers to the use of treasury shares to cover the exercise of
300,350 options under the “2020-2027 Stock Option Plan”.
The following table provides information on the permitted distribution of reserves:
Nature / Description Amount Tax restriction Permitted use
Available
amount
Share capital 226,590 56,884
Capital reserves:
- Share premium reserve 40,078 A,B,C 40,078
- Reserve for treasury shares (9,658)
Earnings reserves
- Legal reserve 45,318 1,257 B
- Extraordinary reserve 201,413 18,722 A,B,C 191,654
- Fair value and cash flow hedge reserve 1,215
- Stock option reserve 5,695
- Actuarial valuation reserve (101)
- Revaluation reserve 10,441 A,B,C 1,866
Total 520,991 76,863 233,598
Key:
A: to increase share capital
B: to cover losses
C: distribution to shareholders
The “Tax restrictions” refer to a restriction imposed following a bonus capital increase created in 1997 using
tax-suspended reserves and a restriction imposed for the misalignment of tax and accounting values in
2000 and 2005. The restrictions were updated based on the 2023 tax return.
De’Longhi Group
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05 Separate annual report and financial statements 198
Liabilities
24. Bank loans and borrowings
Bank loans and borrowings are analyzed as follows:
Payable within one year Payable in 1-5 years 31.12.2023 Payable within one year Payable in 1-5 years 31.12.2022
Current bank loans and borrowings 627 - 627 10 - 10
Loans, short term portion 179,610 - 179,610 87,906 - 87,906
Total bank loans and borrowings 180,237 - 180,237 87,916 - 87,916
Loans (one to five years) - 300,844 300,844 - 477,582 477,582
Total banks loans and borrowings 180,237 300,844 481,081 87,916 477,582 565,498
In 2023 no new loans were taken out.
None of the financial covenants in current loan agreements, based on the net financial debt/net equity and
net financial debt/EBITDA before non-recurring/stock option costs ratios (based on the consolidated finan-
cial statements), had been breached at 31 December 2023.
Most of the bank debt is floating rate; as a result of the hedge on one of the medium/long-term loans, the
floating rate debt was swapped for fixed rate debt. The fair value of the loans, calculated by discounting
future interest flows at current market rates, does not differ significantly from the amount of debt recog-
nized in the financial statements.
25. Other financial payables
This balance, inclusive of the current portion, is made up as follows:
31.12.2023 31.12.2022 Change
Private placement (short‐term
portion)
21,397 21,409 (12)
Other short term financial
payables
94 461 (367)
Total short‐term payables 21,491 21,870 (379)
Private placement (one to five
years)
64,259 85,709 (21,450)
Total long‐term payables
(one to five years)
64,259 85,709 (21,450)
Private placement (beyond
five years)
150,358 150,317 41
Total long‐term payables
(beyond five years)
150,358 150,317 41
Total 236,108 257,896 (21,788)
De’Longhi Group
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05 Separate annual report and financial statements 199
The bond loan refers to the issue and placement of €150 million in unsecured, non-convertible notes with
US institutional investors (the “US Private Placement”) completed in 2017 and an additional €150 million
placed in 2021. In both instances the securities were issued in a single tranche. The first issue matures in 10
years, in June 2027, and has an average life of 7 years. The notes will accrue interest from the subscription
date at a fixed rate of 1.65% per annum. The notes will be repaid yearly in equal instalments beginning June
2021 and ending June 2027, without prejudice to the Company’s ability to repay the entire amount in ad-
vance. The second issue matures in 20 years, in April 2027, and has an average life of 15 years. The securi-
ties are unrated and are not intended to be listed on any regulated markets.
The second issue matures in 20 years, in April 2041, and has an average life of 15 years. The notes will
accrue interest from the subscription date at a fixed rate of 1.18% per annum. The notes will be repaid yearly
in equal instalments beginning April 2031 and ending April 2041, without prejudice to the Company’s ability
to repay the entire amount in advance.
Both issues are unrated and are not intended to be listed on any regulated markets.
The issues are subject to half-yearly financial covenants consistent with those applied to other loans. At 31
December 2023 the covenants based on the net financial debt/net equity and net financial debt/EBITDA
before non-recurring/stock option costs ratios (based on the consolidated financial statements), had not
been breached.
Neither issue is secured by collateral of any kind.
“Other short-term financial payables” refers to the €94 thousand owed the subsidiary De’ Longhi Capital
Services S.r.l. for financial services rendered.
More details on the fair value of derivatives, hedging both exchange rate and interest rate risk, can be found
in note 35. Risk management.
The balance includes €94 thousand in payables from related parties, as reported in Appendix 4.
Net financial position
Details of the net financial position are as follows:
31.12.2023 31.12.2022 Change
A. Cash 1,631 2,470 (839)
B. Cash equivalents - - -
C. Other current financial assets 659,293 860,035 (200,742)
D. Cash, cash equivalents and other current
financial assets (A+B+C)
660,924 862,505 (201,581)
E. Current financial liabilities (22,464) (22,185) (279)
of which lease liabilities (353) (304) (49)
F. Current portion of non‐current financial liabilities (179,610) (87,906) (91,704)
G. Current financial liabilities (E+F) (202,074) (110,091) (91,983)
H. Current net financial liabilities (D+G) 458,850 752,414 (293,564)
I.1. Other non-current financial assets 114 95 19
I. Non-current financial liabilities (301,423) (478,275) 176,852
of which lease liabilities (579) (693) 114
J. Debt instruments (214,617) (236,026) 21,409
K. Trade payables and other non-current liabilities - - -
L. Non-current net financial liabilities (I+I.1+J+K) (515,926) (714,206) 198,280
M. Total financial liabilities (H+L) (57,076) 38,208 (95,284)
Fair value of derivatives and other financial
non-bank assets/liabilities
2,188 3,896 (1,708)
Total net financial position (54,888) 42,104 (96,992)
Details of the net financial position are shown in accordance with CONSOB Bulletin DEM/6064293 of 28.07.2006; in order to provide
a better representation, the other non-current financial assets (item K1) are shown separately; for more information refer to note 13.
Non-current receivables.
Details of financial receivables and payables with related parties are reported in Appendix 4.
For a better understanding of the changes in the net financial position, refer to the statement of cash flows,
appended to these explanatory notes and the details provided in the Report on Operations.
De’Longhi Group
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05 Separate annual report and financial statements 200
26. Deffered tax liabilities
“Deferred tax liabilities” include the taxes calculated on temporary differences between the carrying amount
of assets and liabilities and their corresponding tax base, and the distributable earnings of subsidiaries.
Details are as follows:
31.12.2023 31.12.2022
Taxable amount Tax rate
Total income
taxes
Taxable amount Tax rate
Total income
taxes
Change
Provision for contingencies and other charges (431) 24% (103) 67 24% 16 (119)
Other temporary differences (6,782) 24% (1,628) (4,089) 24% (981) (647)
Total deferred tax assets recognized in the income statement (7,213) (1,731) (4,022) (965) (766)
Reserves distributable by subsidiaries 17,042 4,090 178,552 13,449 (9,359)
Total deferred tax assets/tax liabilities recognized in the income statement 9,829 2,359 174,530 12,484 (10,125)
Change in fair value of cash flow hedges 1,599 24% 384 3,523 24% 846 (462)
Actuarial valuation funds (133) 24% (32) (126) 24% (30) (2)
Total temporary differences recognized in net equity 1,466 352 3,397 816 (464)
Total net closing 11,295 2,711 177,927 13,300 (10,589)
“Reserves distributable by subsidiaries” refer to the deferred tax calculated on the accumulated reserves of
subsidiaries that are potentially distributable in the future.
There are no temporary differences or carry forward tax losses for which deferred tax assets have not been
recognized.
Exposure to Pillar 2 income tax derives from the level of taxation imposed in the jurisdiction in which the
entities of multinational groups (including any entities subject to joint control) are present; this level of taxa-
tion depends on various factors, such as mainly where the income is generated, the tax rate, the tax regula-
tions used to calculate taxable income, as well as the form of and entitlement to incentives or other tax
benefits applicable in the jurisdiction.
Furthermore, given the novelty and complexity of determining the effective level of taxation, in the first re-
porting periods in which Pillar 2 will be effective (namely the periods that begin before 31 December and end
before 30 June 2028) it will be possible to apply a simplified regime based mainly on the accounting infor-
mation available for each relevant jurisdiction (the transitional regime, which provides for Country-by-Coun-
try Reporting - CbCR safe harbors) and based on which - in case at least one of the three threshold tests is
exceeded - compliance costs will be lowered and Pillar 2 taxes will be eliminated.
Taking into account what is known or reasonably estimated at the end of the year, even though this informa-
tion today does not reflect all the provisions of the Pillar 2 legislation connected to the location and
De’Longhi Group
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05 Separate annual report and financial statements 201
operations of all the Group enterprises in all the individual jurisdictions in which the latter operates, and
considering that at the end of the year all the information might not be available or reasonably estimated,
the Company’s exposure to Pillar 2 income tax at the end of the year, including based on the transitional
county-by-country reporting safe harbor, is deemed insignificant.
More specifically, based on the information know or reasonably estimated:
• as the majority of the Group entities are located in jurisdictions which satisfy at least one of the tests
called for under the transitional county-by-country reporting safe harbor, the conditions for application of
the Pillar 2 income tax do not exist, and
• for the remainder of the Group entities, which are located in jurisdictions which do not satisfy any of the
tests called for under the transitional county-by-country reporting safe harbor, the exposure is not signifi-
cant as the taxation in those jurisdictions is near the minimum of 15% or the estimated impact on profit in
these jurisdictions is not material in light of the Group’s total revenues.
The Group, with the support of consultants, is getting organized and preparing for compliance with the Pillar
2 rules, including in order to manage the exposure in subsequent periods by developing adequate systems
and procedures which aim to:
• identify, locate and characterize all the Group enterprises for the purpose of the Pillar 2 rules, and
• carry out the tests called for under the transitional county-by-country reporting safe harbor for each rele-
vant jurisdiction in order to benefit from the reduction in compliance costs and the elimination of Pillar 2
taxes, and
• carry out the complete, detailed calculations of the taxation in any jurisdictions which do not pass any of
the above mentioned test called for Pillar 2.
27. Employee benefits
These are analyzed as follows:
31.12.2023 31.12.2022 Change
Provision for severance indemnities 387 369 18
Other long term benefits 5,916 3,236 2,680
Total 6,303 3,605 2,698
Provision for severance indemnities
The provision for severance indemnities includes amounts payable to the Company’s employees and not
transferred to alternative pension schemes or the pension fund set up by INPS (Italy’s national social securi-
ty agency). This provision has been classified as a defined benefit plan, governed as such by IAS 19 Employ-
ee benefits. Severance indemnity, as an unfunded obligation, does not have any assets servicing it.
This plan is valued on an actuarial basis to express the present value of the benefit payable at the end of
service that employees have accrued at the reporting date.
Movements in the year are summarized below:
Net cost charged to income 31.12.2023 31.12.2022 Change
Interest cost on defined benefit obligation 12 4 8
Total 12 4 8
Change in present value of obligations 31.12.2023 31.12.2022 Change
Present value at 1 January 369 513 (144)
Benefits paid (1) (97) 96
Interest cost on defined benefit obligation 12 4 8
Actuarial gains & losses recognized in the compre-
hensive income statement
7 (51) 58
Present value at reporting date 387 369 18
The principal assumptions used for determining the obligations under the plan described are as follows:
Assumptions used
Severance
indemnity
2023
Severance
indemnity
2022
Discount rate 3.2% 3.7%
Future salary increases 2,0% - 3,0% 2,3% - 3,3%
Inflation rate 2.0% 2.3%
“Other long-term benefits” includes the amount accrued in the reporting period for the 2021-2023 incentive
plan. This plan was approved by the Board of Directors for a limited number of the Company’s key resourc-
es; for further details please refer to the Report on Remuneration.
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05 Separate annual report and financial statements 202
The composition of the company’s workforce is analyzed in the following table:
31.12.2023 Average 2023 31.12.2022 Average 2022
White collars 37 38 38 41
Managers 18 18 17 17
Total 55 56 55 58
28. Other provisions
“Other provisions” includes provisions made during the year for expenses linked to the reorganization of
personnel for €492 thousand.
On 23 February 2023 the French Competition Authority (the “FCA”) notified a few Group companies of a
complaint filed by a French company (and other French sector companies, mentioned in the complaint)
which refers to certain acts that occurred between 2009 and 2014 which were allegedly in violation of rules
governing anti-competitive conduct.
It is not yet possible to assess the possibility or the size of any sanctions. The company believes that there
are sound arguments to be made in its defense.
For more information, please refer to explanatory notes on consolidated financial statements.
29. Trade payables
The balance of €11,677 thousand refers to amounts payable to third parties and related parties for services
rendered. The amounts payable to related parties are broken down in Appendix 4.
Trade payables do not include any amounts due beyond 12 months.
30. Tax payables
Tax payables include income tax subject to separate taxation and does not include amounts due beyond 12
months.
31. Other payables
These are analyzed as follows:
31.12.2023 31.12.2022 Change
Employees 3,274 2,234 1,040
Paables to related companies 2,853 1,684 1,169
Withholdings payables 1,799 1,404 395
Social security institutions 516 577 (61)
Other 1,465 1,179 286
Total 9,907 7,078 2,829
The “Payables towards related parties” mostly refer to amounts owed as a result of the Company’s decision
to pay VAT on a group basis, under the Ministerial Decree dated 13 December 1979, as described in note 17.
Other receivables.
“Withholdings payable” relate to withholdings made by the company and payable to the tax authorities after
the reporting date.
“Social security institutions” include €272 thousand in payables to Italy’s principal social security agency
(INPS), and €244 thousand in payables to pension funds.
Details of payables with related parties are reported in Appendix 4.
There are no other payables due beyond 12 months.
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05 Separate annual report and financial statements 203
32. Commitments
These are detailed as follows:
31.12.2023 31.12.2022 Change
Guarantees given for the benefit of:
De’Longhi Capital Services S.r.l. 133,000 245,210 (112,210)
De’Longhi Kenwood A.P.A. Ltd. 15,093 15,096 (3)
De’Longhi Appliances S.r.l. 5,000 5,133 (133)
De’Longhi Kenwood Korea Ltd. 1,484 1,564 (80)
De’Longhi Brasil Ltda. 782 759 23
De’Longhi Deutchland Gmbh 402 398 4
De’Longhi Kenwood MEIA FZE 370 383 (13)
De' Longhi South Africa Pty Ltd. 324 373 (49)
De’Longhi America Inc. 217 225 (8)
De’Longhi Japan Corp. 184 212 (28)
De Longhi Benelux S.A. 96 104 (8)
De’Longhi Canada Inc. 67 69 (2)
NPE S.r.l.
(1)
- 10,000 (10,000)
De’Longhi Romania S.r.l. - 9,445 (9,445)
Elle S.r.l. - 400 (400)
De’Longhi LLC - 34 (34)
De’Longhi Polska Sp.Zo.o. - 27 (27)
E-Services S.r.l. - 11 (11)
DL Chile S.A. - 7 (7)
Total De’ Longhi Group companies and related parties 157,018 289,450 (132,432)
(1) This investment became a related party investment following the sale of 55% of NPE S.r.l.’s share capital by De’ Longhi Applianc-
es S.r.l. to H&T Group. These guarantees were partially revoked in 2023 as a result of the new agreement signed with the majority
shareholders.
The guarantees given in the interest of Group companies and related parties refer primarily to credit lines
which have been partially drawn down and to short-term loans.
In addition to the above:
• as part of its factoring of trade receivables without recourse, the total exposure for which amounted to
€182,841 at 31 December 2023 (€176,957 at 31 December 2022), the Company issued a surety and a
credit mandate in the interest of its subsidiaries and related parties involved;
• the Company also issued a guarantee in the interest of subsidiaries and related parties relative to curren-
cy hedging, the negative fair value of which amounted to €2,857 thousand at 31 December 2023 (positive
for €2,455 at 31 December 2022);
• the Company also issued third party guarantees totalling €31 thousand.
No elements of risk as defined by IAS 37 have been noted to date.
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05 Separate annual report and financial statements 204
33. Classification of financial assets
and liabilities
Financial assets and liabilities are classified below
in accordance with IFRS 7 using the categories
identified in IFRS 9.
at 31 December 2023
Assets
Total Value Amortized cost Fair value in Profit&Loss Fair value in OCI
Non-current assets
Equity investments
(*)
- - - -
Receivables 120 120 - -
Other non‐current financial assets - - - -
Current assets
Trade receivables 12,499 12,499 - -
Current tax assets - - - -
Other receivables 14,535 14,535 - -
Current financial receivables and assets 661,487 659,293 595 1,599
Cash and cash equivalents 1,631 1,631 - -
at 31 December 2023
Liabilities
Total Value Amortized cost Fair value in Profit&Loss Fair value in OCI
Non‐current liabilities
Bank loans and borrowings (long‐term portion) (300,844) (300,844) - -
Other financial payables (long‐term portion)
(**)
(214,617) (214,617) - -
Current Liabilities
Trade payables (11,677) (11,677) - -
Bank loans and borrowings (short‐term portion) (180,237) (180,237) - -
Other financial payables (short‐term portion)
(**)
(21,491) (21,485) (6)
Current tax liabilities (35) (35) - -
Other payables (9,907) (9,907) - -
(*) Interests in subsidiaries, associates and joint ventures are not included (IFRS 9 - 2.1 a).
(**) Lease liabilities to which IFRS 16 Leases is applied (IFRS 9 - 2.1 b) are not included.
The value of financial assets/liabilities at amortized cost does not differ significantly from their fair value.
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05 Separate annual report and financial statements 205
at 31 December 2022
Assets
Total Value Amortized cost Fair value in Profit&Loss Fair value in OCI
Non-current assets
Equity investments
(*)
- - - -
Receivables 100 100 - -
Other non‐current financial assets 2,020 - - 2,020
Current assets
Trade receivables 1,219 1,219 - -
Current tax assets 483 483 - -
Other receivables 7,610 7,610 - -
Current financial receivables and assets 861,911 860,035 - 1,876
Cash and cash equivalents 2,470 2,470 - -
at 31 December 2022
Liabilities
Total Value Amortized cost Fair value in Profit&Loss Fair value in OCI
Non‐current liabilities
Bank loans and borrowings (long‐term portion) (477,582) (477,582) - -
Other financial payables (long‐term portion)
(**)
(236,026) (236,026) - -
Current Liabilities
Trade payables (7,600) (7,600) - -
Bank loans and borrowings (short‐term portion) (87,916) (87,916) - -
Other financial payables (short‐term portion)
(**)
(21,870) (21,870) - -
Current tax liabilities - - - -
Other payables (7,078) (7,078) - -
(*) Interests in subsidiaries, associates and joint ventures are not included (IFRS 9 - 2.1 a).
(**) Lease liabilities to which IFRS 16 Leases is applied (IFRS 9 - 2.1 b) are not included.
The value of financial assets/liabilities at amortized cost does not differ significantly from their fair value.
De’Longhi Group
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05 Separate annual report and financial statements 206
34. Hierarchical levels of financial instruments measured at fair value
The following table presents the hierarchical levels in which the fair value measurements of financial instru-
ments have been classified at 31 December 2023. As required by IFRS 13, the hierarchy comprises the fol-
lowing levels:
• level 1: quoted prices in active markets for identical assets or liabilities;
• level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly or indirectly;
• level 3: inputs for the asset or liability that are not based on observable market data.
Financial instruments measured at fair value Level 1 Level 2 Level 3
Derivatives with positive fair value 2,194
There were no transfers between the levels during the year.
35. Risk management
The Company is exposed to the following financial risks as part of its normal business activity:
• credit risk, mainly arising from the investment of surplus cash;
• liquidity risk, arising from the need to have adequate access to capital markets and sources of finance to
fund its operations, investment activities and the settlement of financial liabilities;
• exchange rate risk, associated with the exposure to currencies other than the Company’s functional
currency;
• interest rate risk, relating to the cost of the Company’s debt.
Credit risk
Credit risk consists of the Company’s exposure to potential losses arising from failure by a counterparty to
fulfil its obligations.
Trade credit risk is associated with the normal course of business and is monitored using formal proce-
dures to assess customers and extend them credit, define credit limits, as well as monitor expected inflows,
including with a view to credit collection.
Positions are written down when there is objective evidence that they will be partially or entirely uncollected,
bearing in mind that a significant proportion of receivables are covered by insurance policies with major
insurers.
This is not a material risk for the Company, whose principal credit exposures are to Group companies.
As far as financial credit risk is concerned, it is the Company’s policy to maintain a sufficiently large portfolio
of counterparties of high international repute for the purposes of satisfying its financing and hedging needs.
Liquidity risk
Liquidity risk is the risk of not having the funds needed to fulfil payment obligations arising from operating
and investment activities and from the maturity of financial instruments.
The Company complies with specific group policies and procedures for the purposes of monitoring and
managing this risk, including:
• centralized management of financial payables and cash, supported by reporting and information sys-
tems and, where possible, cash pooling arrangements;
• raising of medium and long-term finance on capital markets;
• diversification of the type of financing instruments used;
• obtaining of short-term credit lines such as to ensure wide room for manoeuvre for the purposes of man-
aging working capital and cash flows;
• monitoring of current and forecast financing needs and distribution within the Group.
The Company has short and medium-term credit lines used to finance working capital and other operating
needs (issuing guarantees, foreign exchange transactions, etc.), or relative to the current loan transactions
described in this report.
These credit lines, along with cash flow generated by operations, are considered sufficient to satisfy the
Company’s annual funding requirements for working capital, investments and settlement of payables on
their natural due dates.
Note 33. Classification of financial assets and liabilities presents the book value of financial assets and liabil-
ities, in accordance with the categories identified by IFRS 9.
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05 Separate annual report and financial statements 207
The following table summarizes the due dates of financial liabilities at 31 December 2023 and at 31 Decem-
ber 2022 on the basis of undiscounted contractual payments.
Undiscounted
cash flows at
31.12.2023
Payable
within one
year
Payable in
1-5 years
Payable in
more than
five years
Undiscounted
cash flows at
31.12.2022
Payable
within one
year
Payable in
1-5 years
Payable in
more than
five years
Bank loans and borrowings (*) (517,374) (196,689) (320,684) - (608,305) (101,329) (506,976) -
Other financial payables (**) (260,762) (24,530) (72,957) (163,275) (285,919) (25,251) (95,623) (165,045)
Trade payables (11,677) (11,677) - - (7,600) (7,600) - -
Current tax payables and other
payables
(9,942) (9,942) - - (7,078) (7,078) - -
Total (799,755) (242,839) (393,641) (163,275) (908,902) (141,258) (602,599) (165,045)
(*) The corresponding balance reported in the financial statements is €481,080 thousand at 31 December 2023 and €565,498 thou-
sand at 31 December 2022. See note 24. Bank loans and borrowings.
(**) The corresponding balance reported in the financial statements amounted to €236,108 thousand at 31 December 2023 (net of
the fair value of derivatives of €0 thousand) and €257,896 thousand at 31 December 2022. For further details refer to note 25.
Other financial payables.
With regard to lease liabilities in accordance with IFRS 16, please refer to note 11. Leases.
Exchange rate risk
The Company is exposed to the risk of fluctuations in currencies (other than its functional one) in which or-
dinary trade and financial transactions are denominated. For the purposes of protecting its income state-
ment and statement of financial position from such fluctuations, the Company adopts a suitable hedging
policy that eschews speculative ends.
Details of the policies, instruments and purpose of hedging at Group level can be found in the notes to the
consolidated financial statements.
Sensitivity analysis:
The potential impact, in terms of change in fair value, of a hypothetical, sudden +/-5% change in year-end
exchange rates was estimated in light solely of receivables/payables in unhedged currencies insofar as the
impact on the income statement of the receivables/payables in hedged currencies is mitigated or offset by
the respective hedges. A +/- 5% change in year-end exchange rates of the principal exposed currencies
(USD, HKD and GBP) is estimated to produce a change in fair value of around +/- €47 thousand (+/- €81
thousand at 31 December 2022). As most of the receivables/payables in question are due beyond twelve
months the change in fair value would impact the income statement of the following year.
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05 Separate annual report and financial statements 208
The hedging transactions at 31 December 2023 are described in the paragraph “Interest rate and currency
exchange hedges at 31 December 2023”.
Interest rate risk
The Company is exposed to interest rate risk on floating rate loans and borrowings. This risk is managed
centrally by the same team that manages currency risks.
The bonds and a part of the loan taken out in 2019, which is hedged with an Interest Rate Swap, are fixed
rate, while the remainder of the Company’s financial debt at 31 December 2023 was floating rate.
The purpose of interest rate risk management is to assess the mismatch between financial assets and lia-
bilities and verify that there are no relevant gaps such that could impact the cost of funding if the yield curve
were to steepen.
Sensitivity analysis:
When estimating the potential impact of a hypothetical, sudden material change in interest rates (+/- 1% in
market rates) on the cost of the Company’s debt, only those items forming part of net financial position
which earn/incur interest have been considered and not any others (meaning total net assets of €235.5 mil-
lion on a total of €54.9 million in net debt at 31 December 2023 and total net assets of €365.1 million on a
total of €42.1 million in net debt in 2022). In the absence of hedges, any change in interest rates would di-
rectly impact the cost of that portion of debt resulting in an increase/decrease in financial expenses.
A +/-1% change in interest rates would have an impact of +/- €2.4 million before tax at 31 December 2023
recognized entirely in the income statement (+/- €3.7 million before tax at 31 December 2022).
Thanks to the hedge in place on the relative portion of the loan, it was possible to swap the floating rate debt
into fixed rate. Any change in the interest rate would, at any rate, not have impacted the income statement.
In light, however, of the fact that the hedges are measured at fair value and that the portion relating to future
interest flows is recognized at net equity, at 31 December 2023 a change of +/- 1% in rates would cause a
change in the cash flow hedge of +/- €0.25 million before tax (+/- € 0.8 million before tax at 31 December
2022).
Please refer to the paragraph “Interest rate and currency exchange hedges at 31 December 2023” for more
information.
Interest rate and currency exchange hedges at 31 December 2023
For accounting treatment purposes, derivatives hedging the risk on expected cash flows are accounted for
in hedge accounting (cash flow hedge), as for the provisions of IFRS 9.
Derivatives that hedge foreign currency payables and receivables are reported with changes in their fair
value reported in the income statement. These instruments offset the risk on the hedged item (which is a
recognized asset or liability).
IRS (Interest Rate Swap) hedging interest rate risk on loans:
The IRS are measured at fair value, using the discounted cash flow method based on the swap curve with-
out the spread; at 31 December 2023 the derivative’s fair value, pursuant IFRS 13 - Fair Value measurement,
was positive for €2,194 thousand and is included in financial assets.
As the hedge on future interest flows qualifies as an effective hedge, at 31 December 2023 a positive cash
flow hedge reserve of €1,599 thousand was reported in net equity, net of the related tax effect of €384
thousand.
Details are as follows (the figures are shown before tax):
31.12.2023
Notional amount (in
€/000)
Fair value (in €/000)
Derivatives hedging interest rate risk (IRS)
- Interest Rate Swap (IRS) connected to loan
56,000 2,194
Total fair value of the derivatives
of which:
positive short-term fair value 2,194
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05 Separate annual report and financial statements 209
Contracts to hedge exchange rate risk on credits and debts
In order to protect balance sheet items from exchange rate fluctuations, the company adopts a hedging
policy that uses procedures and tools suitable for this purpose and free from speculative connotations.
Hedging derivatives details on payables and receivables in foreign currency are as follows:
Currency
Notional amount (in €/000) Fair value (€/000)
Purchase Sales Total
Current
assets
Current
liabilities
USD/EUR (115) 630 515 - (4)
HKD/EUR - 7.160 7.160 - (2)
Total - (6)
Derivatives hedging payables and receivables in foreign currency, however, are recorded at fair value with
direct attribution to the income statement. These instruments offset the risk being hedged (already record-
ed in the balance sheet).
36. Transactions and balances with related parties
Appendix 4 contains the information concerning transactions and balances with group companies and re-
lated parties required by CONSOB Regulations 97001574 dated 20 February 1997, 98015375 dated 27 Feb-
ruary 1998 and DEM/2064231 dated 30 September 2002; all such transactions have fallen within the
Group’s normal operations, except as otherwise stated in these notes, and have been settled under arm’s-
length terms and conditions.
37. Subsequent events
On 27 February 2024 the Group finalized the agreements for a business combination between Eversys (a
leading company in the production and distribution of automatic coffee machines) and La Marzocco (a
leading company in the production and distribution of semi-automatic coffee machines and coffee grind-
ers). For further information on the purpose and structure of the transaction refer to the Report on Opera-
tions included in the Annual Report.
The Group’s total net cash out for the transaction reached approximately US$ 373 million, including the US$
200 million paid to De Longhi Industrial S.A. (for the 22% stake in La Marzocco) and US$ 173 million for the
purchase of shares from La Marzocco’s minority shareholders (for the 19.1% stake in La Marzocco).
This amount was totally self-financed.
In this report, costs for advisory and consultancy services connected to the business combination have
been accounted, for the relevant share on accrual basis.
With the exception of the above, after 31 December 2023 through the date on which this annual report was
approved, no events occurred that would have had a significant impact on financial and economic results
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05 Separate annual report and financial statements 210
recorded, as per IAS 10 - Events after the reporting
period.
38. Proposed shareholder resolutions
1) Proposed resolution relating to item 1 of the
Agenda for the Annual General Meeting convened
on 19 April 2024 (“Approval of the separate finan-
cial statements at 31 December 2023, together
with the Directors’ Report on Operations, the Board
of Statutory Auditors’ Report and the External Au-
ditors’ Report. Presentation of the Consolidated
Annual Report at 31 December 2023. Presentation
of the Legislative Decree 254/16 Consolidated
Non-Financial Statement. Related and consequent
resolutions”).
Dear Shareholders,
in submitting the Annual Report at 31 December
2023 to you for approval during the Annual General
Meeting, we propose that you approve the follow-
ing resolution:
“The shareholders of De’ Longhi S.p.A.,
having examined the draft separate financial state-
ments at 31 December 2023 of De’ Longhi S.p.A., the
Board of Directors’ Report on Operations, the Board
of Statutory Auditors’ Report and the other docu-
mentation called for under the law
resolve
to approve the Directors’ Report on Operations and
the separate financial statements at 31 December
2023 of De’ Longhi S.p.A.”.
2) Proposed resolution relating to item 2 of the
Agenda for the Annual General Meeting convened
on 19 April 2024 (“Proposed allocation of the net
profit for the year. Related and consequent
resolutions”).
Dear Shareholders,
with regard to the allocation of the net profit for the
year closed on 31 December 2023, which amount-
ed to €36,578,046, we propose that you approve
the following resolution:
“The shareholders of De’ Longhi S.p.A., having ac-
knowledged the net profit for the year shown in the
separate financial statements at 31 December
2023 and the Directors’ Report on Operations
resolve
1. to distribute a gross ordinary dividend of €0.67
for each of the outstanding shares with dividend
rights at the record date, as per art. 83-terdecies
of Legislative Decree 58/98;
2. to use the net earnings shown in the separate fi-
nancial statements at 31 December 2023 for the
purposes of 1) above and to use the extraordi-
nary reserve to cover any differences;
3. to establish a record date of 21 May 2024, pursu-
ant to art. 83-terdecies of Legislative Decree n.
58/98, and that the dividend will be paid on each
share with dividend rights as from 22 May 2024,
with shares going ex-div on 20 May, in accord-
ance with Borsa Italiana’s calendar,”.
Treviso, 12 March 2024
De’ Longhi S.p.A.
Vice Chairman and Chief Executive Officer
Fabio de’ Longhi
Appendices
Separate annual report
and financial statement
De’Longhi Group
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05 Separate annual report and financial statements 212
Appendices
These appendices contain additional information to that reported in the explanatory notes, of which they
form an integral part.
This information is contained in the following appendices:
1. Certification of the financial statements pursuant to art. 81-ter of CONSOB Regulation 11971 dated 14
May 1999 and subsequent amendments and additions.
2. Statement of cash flows in terms of net financial position.
3. List of subsidiary companies and changes in equity investments.
4. Transactions and balances with related parties:
a. Income statement and statement of financial position
b. Summary by company
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05 Separate annual report and financial statements 213
APPENDIX 1
Certification of the financial statements pursu-
ant to art. 81-ter of CONSOB Regulation 11971
dated 14 May 1999 and subsequent amend-
ments and additions
The undersigned Fabio de’ Longhi, Chief Executive
Officer and Stefano Biella, as Officer Responsible
for Preparing the Company’s Financial Report of
De’ Longhi S.p.A., attest, also taking account of the
provisions of paragraphs 2, 3 and 4, art. 154-bis of
Decree 58 dated 24 February 1998:
that the accounting and administrative processes
for preparing the financial statements during 2022:
• have been adequate in relation to the company’s
characteristics and
• have been effectively applied.
It is also certified that the financial statements at
31 December 2023:
• have been prepared in accordance with the Inter-
national Financial Reporting Standards adopted
by the European Union under Regulation (EC)
1606/2002 of the European Parliament and
Council dated 19 July 2002 and with the meas-
ures implementing art. 9 of Decree 38/2005;
• correspond to the underlying accounting records
and books of account;
• are able to provide a true and fair view of the is-
suer’s statement of financial position and results
of operations.
The report on operations contains a reliable ac-
count of performance and of the results of opera-
tions and of the situation of the issuer, together
with a description of the principal risks and uncer-
tainties to which they are exposed.
Fabio de’Longhi
Chief Executive Officer
Stefano Biella
Officer Responsible for Preparing the Company’s Fi-
nancial Report
De’Longhi Group
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05 Separate annual report and financial statements 214
APPENDIX 2
Statement of cash flows in
terms of net financial
position
(€/000) 2023 2022
Profit (loss) 36,578 100,808
Income taxes for the period (3,335) 5,804
Income from dividends receipt (51,923) (132,947)
Amortization 425 392
Net change in provisions and other non-cash items 4,089 (1,356)
Cash flow absorbed by current operations (A) (14,166) (27,299)
Change in assets and liabilities for the period:
Trade receivables (11,280) 52
Trade payables 4,077 1,736
Other changes in net working capital (393) 4,709
Payment of income taxes (9,972) -
Cash flow generated (absorbed) by movements in working capital (B) (17,568) 6,497
Cash flow generated by current operations and movements in working capital (A+B) (31,734) (20,802)
Investment activities:
Investments in property, plant and equipment (22) -
Investments in leased assets (284) -
Other cash flows for property, plant and equipment 27 (266)
Net equity investments and other financial assets (48,000) -
Dividends collection 51,923 132,947
Cash flow absorbed by investment activities (C) 3,644 132,681
Cash flow by operating activities (A+B+C) (28,090) 111,879
Exercise of stock option 5,101 3,353
Dividends paid (72,079) (124,501)
Cash flow reserves (1,924) 3,400
Cash flows absorbed by changes net equity (D) (68,902) (117,748)
Cash flow for the period (A+B+C+D) (96,992) (5,869)
Opening net financial position 42,104 47,973
Cash flow for the period (A+B+C+D) (96,992) (5,869)
Closing net financial position (54,888) 42,104
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05 Separate annual report and financial statements 215
Company name Registered office
Share capital Net equity
Latest reported
profit or (loss)
Latest reported
profit or (loss)
Book value
(€/000)
Subsidiary companies:
De Longhi Benelux S.A.
(1)
Luxembourg Eur 181,730,990 Eur 316,321,530 Eur 10,545,503 100% 314,737
De’Longhi Appliances S.r.l. Treviso Eur 200,000,000 Eur 357,879,708 Eur 83,639,496 100% 242,678
De’Longhi Deutschland GmbH
(2)
Neu Isenburg Eur 2,100,000 Eur 63,418,661 Eur 10,801,542 100% 40,800
De’Longhi Capital Services S.r.l
. (3) (4)
Treviso Eur 53,000,000 Eur 66,957,579 Eur 2,330,745 11.32% 6,005
E-Services S.r.l. Treviso Eur 50,000 Eur 3,010,584 Eur 2,474,226 100% 5,264
De’Longhi Romania S.r.l.
(2) (4)
Cluj-Napoca Ron 140,000,000 Ron 701,614,812 Ron 95,112,578 10% 3,078
De’Longhi Kenwood GmbH
(2)
Wr. Neudorf Eur 36,336 Eur 4,109,843 Eur 1,311,593 100% 2,900
Clim.Re S.A.
(1) (4)
Luxembourg Eur 1,239,468 Eur 2,575,946 Eur 654,865 4% 54
De’Longhi Polska Sp.Zo.o.
(2) (4)
Warszawa Pln 50,000 Pln 96,334,630 Pln 19,025,807 0.1% -
Bruno International HoldCo LLC Wilmington Usd 1 Usd - Usd - 100% -
Bruno U.S. HoldCo LLC Wilmington Usd 1 Usd - Usd - 100% -
Total 615,516
(*) Statutory figures at 31 December 2023, unless otherwise specified.
(1) Statutory figures at 31 December 2022.
(2) Figures used for the purposes of consolidation at 31 December 2023.
(3) The articles of association, approved by the extraordinary shareholders’ meeting held on 29 December 2004, give special rights to De’ Longhi S.p.A. (holding 89% of the voting rights) for ordinary resolutions (approval of financial statements, declaration of dividends,
nomination of directors and statutory auditors, purchase and sale of companies, grant of loans to third parties); voting rights are proportional as far as other resolutions are concerned.
(4) The residual interest is held indirectly.
APPENDIX 3
(*)
List of equity investments in sub-
sidiary companies (art. 2427 of the
Italian Civil Code)
De’Longhi Group
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05 Separate annual report and financial statements 216
APPENDIX 3 - cont’d
Changes in equity investments
Equity investments
(Amount in thousands of Euro)
Book value at
31.12.2022
Acquisitions,
subscriptions and
recapitalizations
Demerger
Net impairment
losses and
reversals
Book value at
31.12.2023
Imprese controllate:
De Longhi Benelux S.A. 266,737 48,000 - - 314,737
De’Longhi Appliances S.r.l. 242,678 - - - 242,678
De’Longhi Deutschland GmbH 40,800 - - - 40,800
De’Longhi Capital Services S.r.l. 6,005 - - - 6,005
E-Services S.r.l. 5,264 - - - 5,264
De’Longhi Romania S.r.l. 3,078 - - - 3,078
De’Longhi Kenwood GmbH 2,900 - - - 2,900
Clim.Re S.A. 54 - - - 54
De’Longhi Polska Sp.Zo.o. - - - - -
Bruno International HoldCo LLC - - - - -
Bruno U.S. HoldCo LLC - - - - -
Total 567,516 48,000 - - 615,516
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05 Separate annual report and financial statements 217
APPENDIX 4
Transactions and balances
with related parties
Income statement
Income Statement pursuant to CONSOB resolution 15519 of 27
July 2006 (Amounts in thousands of Euro)
Notes 2023
of which with
related parties
2022
of which with
related parties
Other revenues 1 15,157 15,073 12,667 12,573
Total revenues 15,157 12,667
Raw and ancillary materials, consumables and goods 2 (61) (67)
Materials consumed (61) (67)
Payroll costs 3 (13,487) (7,846)
Services and other operating expenses 4 (23,412) (2,769) (18,842) (2,604)
Provisions 5 (492) -
Amortization 6 (425) (392)
EBIT (22,720) (14,481)
Net financial income (expenses) 7 55,963 77,959 121,093 136,452
Profit (loss) before taxes 33,243 106,612
Taxes 8 3,335 (5,804)
Profit (loss) 36,578 100,808
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05 Separate annual report and financial statements 218
Balance sheet
Statement of financial position pursuant to CONSOB resolution
15519 of 27 July 2006 (Amounts in thousands of Euro)
Notes 31.12.2023
of which with
related parties
31.12.2022
of which with
related parties
Non-current assets
Intangible assets 31 65
- Other intangible assets 9 31 65
Property, plant and equipment 995 1,107
- Other tangible assets 10 61 111
- Right of use assets 11 935 996
Equity investments and other financial assets 615,637 569,637
- Equity investments 12 615,516 567,516
- Receivables 13 121 114 100 95
- Other non-current financial assets 14 - 2,020
Total non-current assets 616,663 570,809
Current assets
Trade receivables 15 12,499 12,499 1,219 1,161
Current tax assets 16 - 483
Other receivables 17 14,535 9,039 7,613 5,457
Current financial receivables and assets 18 661,487 659,294 861,911 860,035
Cash and cash equivalents 19 1,631 2,470
Total current assets 690,153 873,697
Total assets 1,306,816 1,444,505
APPENDIX 4 - cont’d
Transactions and balances
with related parties
De’Longhi Group
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05 Separate annual report and financial statements 219
Statement of financial position pursuant to CONSOB resolution
15519 of 27 July 2006 (Amounts in thousands of Euro)
Notes 31.12.2023
of which with
related parties
31.12.2022
of which with
related parties
NET EQUITY
- Share Capital 22 226,590 226,590
- Reserves 23 294,401 261,133
- Profit (loss) 36,578 100,808
NET EQUITY 557,569 588,531
Non-current liabilities
Financial payables 516,040 714,301
- Banks loans and borrowings (long-term portion) 24 300,844 477,582
- Other financial payables (long-term portion) 25 214,617 236,026
- Lease liabilities (long-term portion) 11 579 329 693 518
Deferred tax liabilities 26 2,712 13,300
Non-current provisions for contingencies and other charges 6,795 3,604
- Employee benefits 27 6,303 3,604
- Other provisions 28 492 -
Total non-current liabilities 525,547 731,206
Current liabilities
Trade payables 29 11,677 373 7,600 25
Financial payables 202,081 110,091
- Banks loans and borrowings (short-term portion) 24 180,237 87,916
- Other financial payables (short-term portion) 25 21,491 94 21,870 111
- Lease liabilities (short-term portion) 11 353 216 304 202
Current tax liabilities 30 35 -
Other payables 31 9,907 2,853 7,078 1,684
Total current liabilities 223,700 124,769
Total net equity and liabilities 1,306,816 1,444,505
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05 Separate annual report and financial statements 220
APPENDIX 4 - cont’d
Transactions and balances with related
parties - Summary by company
(€/million) Revenues
(1)
Consumption
and costs for
services
(1)
Financial
income
(expenses)
Non-current
financial
receivables
Current financial
receivables
Other
receivables
(2)
Non-current
financial
payables
Current financil
payables
(3)
Other payables
(4)
Ultimate parent companies:
DE LONGHI INDUSTRIAL S.A. - - - - - 8.5 - - -
Total ultimate parent companies (a) - - - - - 8.5 - - -
Subsidiary companies:
DE' LONGHI APPLIANCES S.R.L. 9.2 (0.2) 48.9 - - 10.0 (0.3) (0.2) (3.1)
E-SERVICES S.R.L. 3.4 (0.7) 1.7 - - 0.3 - - (0.1)
DE' LONGHI KENWOOD A.P.A. LTD 1.6 - - 0.1 - 1.6 - - -
CAPITAL BRANDS HOLDINGS INC. 0.6 - - - - 0.6 - - -
DE' LONGHI S.R.L. - ROMANIA - - - - - - - - -
KENWOOD LIMITED 0.1 (0.1) - - - 0.1 - - -
DE' LONGHI HOUSEHOLD GMBH 0.1 - - - - 0.1 - - -
DE' LONGHI AMERICA INC - (1.8) - - - - - - -
DE' LONGHI CAPITAL SERVICES Srl - - 26.0 - 659.3 - - (0.1) -
DE' LONGHI-KENWOOD GMBH - AUSTRIA - - 1.3 - - - - - -
KENWOOD APPLIANCES (S) PTE LTD - SINGAPORE - - - - - 0.3 - - -
Total subsidiary companies (b) 15.0 (2.8) 77.9 0.1 659.3 13.0 (0.3) (0.3) (3.2)
Related companies:
GAMMA S.R.L. 0.1 - - - - - - - -
Total related companies (c) 0.1 - - - - - - - -
Total ultimate parent, subsidiary and related
companies (a+b+c)
15.1 (2.8) 77.9 0.1 659.3 21.5 (0.3) (0.3) (3.2)
(1) These mostly refer to dealings of a commercial nature and the supply of administrative services by company employees.
(2) These consist of €12.5 million in “Trade receivables” and €9.0 million in “Other receivables”.
(3) This item includes €0.1 million in “Other financial payables” and €0.2 million in “Lease payables”.
(4) This item includes €0.4 million in “Trade payables” and €2.8 million “Other payables”.
Please refer to the yearly “Report on Remuneration” for information relating to the compensation of directors and statutory auditors.
Separate annual report
and financial
statements
External auditors’
report on the
separate financial
statements
Independent auditor’s report
in accordance with article 14 of Legislative Decree No. 39 of 27 January 2010 and article 10 of
Regulation (EU) No. 537/2014
To the shareholders of De’ Longhi SpA
Report on the Audit of the Financial Statements
Opinion
We have audited the financial statements of De’ Longhi SpA (the Company), which comprise the
statement of financial position as of 31 December 2023, the income statement, the statement of
comprehensive income, the statement of changes in equity, the statement of cash flows for the year
then ended, and explanatory notes to the financial statements, including material accounting policy
information.
In our opinion, the financial statements give a true and fair view of the financial position of the
Company as of 31 December 2023, and of the result of its operations and cash flows for the year then
ended in accordance with International Financial Reporting Standards as adopted by the European
Union, as well as with the regulations issued to implement article 9 of Legislative Decree No. 38/05.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISA Italia).
Our responsibilities under those standards are further described in the Auditor’s Responsibilities for
the Audit of the Financial Statements section of this report. We are independent of the Company
pursuant to the regulations and standards on ethics and independence applicable to audits of
financial statements under Italian law. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
There are no key audit matters to disclose in this report.
Responsibilities of the Directors and the Board of Statutory Auditors for the Financial
Statements
The directors are responsible for the preparation of financial statements that give a true and fair view
in accordance with International Financial Reporting Standards as adopted by the European Union,
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05 Separate annual report and financial statements 222
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as well as with the regulations issued to implement article 9 of Legislative Decree No. 38/05 and, in
the terms prescribed by law, for such internal control as they determine is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to fraud or
error.
The directors are responsible for assessing the Company’s ability to continue as a going concern and,
in preparing the financial statements, for the appropriate application of the going concern basis of
accounting, and for disclosing matters related to going concern. In preparing the financial
statements, the directors use the going concern basis of accounting unless they either intend to
liquidate the Company or to cease operations, or have no realistic alternative but to do so.
The board of statutory auditors is responsible for overseeing, in the terms prescribed by law, the
Company’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
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 (ISA Italia) 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 the financial statements.
As part of our audit conducted in accordance with International Standards on Auditing (ISA Italia),
we exercised our professional judgement and maintained professional scepticism throughout the
audit. Furthermore:
we identified and assessed the risks of material misstatement of the financial statements,
whether due to fraud or error; we designed and performed audit procedures responsive to
those risks; we obtained 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;
we obtained 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;
we evaluated the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors;
we concluded on the appropriateness of the directors’ use of the going concern basis of
accounting 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;
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05 Separate annual report and financial statements 223
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we evaluated the overall presentation, structure and content of the financial statements,
including the disclosures, and whether the financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
We communicated with those charged with governance, identified at an appropriate level as required
by ISA Italia, 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 identified
during our audit.
We also provided those charged with governance with a statement that we complied with the
regulations and standards on ethics and independence applicable under Italian law and communicated
with them all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, actions taken to eliminate the related risks, or safeguards
applied.
Additional Disclosures required by Article 10 of Regulation (EU) No 537/2014
On 19 April 2018, the shareholders of De’ Longhi SpA in general meeting engaged us to perform the
statutory audit of the Company’s and consolidated financial statements for the years ending
31 December 2019 to 31 December 2027.
We declare that we did not provide any prohibited non-audit services referred to in article 5,
paragraph 1, of Regulation (EU) No. 537/2014 and that we remained independent of the Company in
conducting the statutory audit.
We confirm that the opinion on the financial statements expressed in this report is consistent with the
additional report to the board of statutory auditors, in its capacity as audit committee, prepared
pursuant to article 11 of the aforementioned Regulation.
Report on Compliance with other Laws and Regulations
Opinion on compliance with the provisions of Commission Delegated Regulation (EU)
No. 2019/815
The directors of De’ Longhi SpA are responsible for the application of the provisions of Commission
Delegated Regulation (EU) No. 2019/815 concerning regulatory technical standards on the
specification of a single electronic reporting format (ESEF - European Single Electronic Format)
(hereinafter, the “Commission Delegated Regulation”) to the financial statements as of 31 December
2023, to be included in the annual report.
We have performed the procedures specified in auditing standard (SA Italia) No. 700B in order to
express an opinion on the compliance of the financial statements with the provisions of the
Commission Delegated Regulation.
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05 Separate annual report and financial statements 224
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In our opinion, the financial statements as of 31 December 2023 have been prepared in XHTML
format in compliance with the provisions of the Commission Delegated Regulation.
Opinion in accordance with Article 14, paragraph 2, letter e), of Legislative Decree
No. 39/10 and Article 123-bis, paragraph 4, of Legislative Decree No. 58/98
The directors of De’ Longhi SpA are responsible for preparing a report on operations and a report on
the corporate governance and ownership structure of De’ Longhi SpA as of 31 December 2023,
including their consistency with the relevant financial statements and their compliance with the law.
We have performed the procedures required under auditing standard (SA Italia) No. 720B in order to
express an opinion on the consistency of the report on operations and of the specific information
included in the report on corporate governance and ownership structure referred to in article 123-bis,
paragraph 4, of Legislative Decree No. 58/98, with the financial statements of De’ Longhi SpA as of
31 December 2023 and on their compliance with the law, as well as to issue a statement on material
misstatements, if any.
In our opinion, the report on operations and the specific information included in the report on
corporate governance and ownership structure mentioned above are consistent with the financial
statements of De’ Longhi SpA as of 31 December 2023 and are prepared in compliance with the law.
With reference to the statement referred to in article 14, paragraph 2, letter e), of Legislative Decree
No. 39/10, issued on the basis of our knowledge and understanding of the Company and its
environment obtained in the course of the audit, we have nothing to report.
Treviso, 28 March 2024
PricewaterhouseCoopers SpA
Signed by
Filippo Zagagnin
(Partner)
This independent auditor’s report has been translated into the English language solely for the
convenience of international readers. Accordingly, only the original text in Italian language is
authoritative.
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05 Separate annual report and financial statements 225
