2023
Annual Report
H+H International A/S
CVR-no: 49 61 98 12 | LEI: 3800GJODT6FV8QM841 | Lautrupsgade 7, 5
th
Floor. 2100 Copenhagen Ø
Purpose and promises
We enable better homes
for our communities
Partners in Wall Building
Being a part of H+H means you
are in the business of people and
teamwork.
Our partners trust us to under-
stand their building needs from
design, specification and planning
to delivery, assembly and problem
solving.
With our partners, we enable
better homes for our communities.
Putting people first
The health and safety of our people,
suppliers and customers, will
never be compromised. We are
committed and have the ambition
of zero harm for our own and our
partners’ people.
We know that people are different.
We trust our differences enable us
to see new opportunities and be
more effective.
People are the heart of H+H.
Performance driven
H+H strives to deliver results to all
our partners and in the communi-
ties where we operate.
Even when times are difficult,
we deliver quality products with
the highest level of service to our
customers. Our operations run
timely and effectively. We follow
through on our commitment to
serve our communities.
You can trust us to deliver on our
promises.
Pushing the boundaries
To build better homes, we must
stay curious and eager to drive our
industry forward.
We are continuously improving
operations and products. Together
with our partners we rethink supply
chains, services and digital solu-
tions.
We are pushing to meet the needs
of tomorrow.
Part of a sustainable future
Today we work with our partners to
reduce energy needs in homes and
our commitment is more than the
long lasting and insulating products
we produce.
We are part of the solution in
creating sustainable and carbon
neutral buildings. We are partnering
with our customers, suppliers, and
other stakeholders; finding new
production methods to lower the
environmental impact of homes.
We act today to realise our vision
of carbon neutrality in 2050.
2
Annual Report 2023 In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Purpose and promises
Management’s review Financial statements
Table of Contents
In brief
5 H+H at a glance
6 Performance highlights
7 Five-year summary
8 Chair letter
10 CEO letter
12 Equity story
13 Outlook
Business and strategy
15 Business model
16 Products and solutions
17 Strategic focus areas
22 Long-term targets
Governance
37 Corporate governance
41 Board of Directors
43 Executive Board
44 Shareholder information
46 Risk management
Sustainability statement
50 General information
57 Environmental information
67 Social information
74 Governance information
77 Summary of metrics and
appendix
78 ESG accounting policy
Financial statements
85 Consolidated financial
statements
89 Notes
121 Statements
128 Contact information
Results
24 Full year financial review
26 Q4 2023 results
27 Sustainability performance
28 Our geographical footprint
29 The United Kingdom
31 Central Western Europe
34 Poland
Our annual reporting
The Annual Report of H+H International A/S comprises consolidated financial statements
and parent company prepared in accordance with the IFRS Accounting Standards as adopted
by the EU and further requirements in the Danish Financial Statements Act. The sustainability
statement is prepared with reference to the Corporate Sustainability Reporting Directive
(CSRD) and the European Sustainability Reporting Standards (ESRS). It has also been pre
-
pared in compliance with sections 99a, 99b and 107d of the Danish Financial Statements Act.
Unless otherwise stated, all figures in parenthesis refer to the corresponding figures in the
prior year.
Other 2023 reports
Remuneration report
Corporate governance statement
3
Annual Report 2023 In brief
Table of Contents
Sustainability statementBusiness and strategy Results Governance Financial statements
H+H at a glance
The market downturn in 2023 led H+H to undertake significant
restructuring to align production with current demand. Despite
this, H+H remains a leading provider of solutions and materials
for wall building, maintaining a strong and diversified market
position across our geographies.
Sustainability
46%
By 2030, we want to reduce absolute scope
1 and 2 GHG emissions by 46% from a 2019
base year. As of 2023, we have achieved a 21%
improvement on CO
2
kg/m
3
.
We want to achieve net-zero emissions from
own operations and supply chain by 2050.
People
1,261
Following the restructuring in 2023, we
reduced our FTE count by approximately
500 to 1,261 employees in 2023.
Plants
27
In 2023, we closed nine plants. Five plants were
permanently closed and four are temporarily
closed. With that setup, a total of 2.9 million
cubic meters of wall-building materials were
produced in 2023.
Our markets
Share of revenue
Revenue (DKKm)
2,672
In 2023, we generated total revenue of
DKK 2,672 million and negative organic
growth of 25%.
29%
The United Kingdom
24%
Poland
47%
Central Western
Europe
5
Annual Report 2023
H+H at a glance
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
0
100
200
300
400
500
600
700
800
0
1
2
3
4
5
6
7
8
0
100
200
300
400
500
600
700
800
0
1
2
3
4
5
6
7
8
kopi flyttet 50 mm
New dwellings Long-term interest rate
2005
2007
2009
2011
2013
2015
2017
2019
2021
2023
‘000 %
2005
2007
2009
2011
2013
2015
2017
2019
2021
2023
‘000 %
Performance highlights
SustainabilityFinancialMarkets
In year cost savings
DKKm
Building activity Financial gearing before special items
DKKm
3.4
In 2023, our LTIF rate improved from 3.6 to 3.4
- a record-low result.
Building permits Long-term interest rates
Organic growth
Percent
Sales volume y/y
Percent
EBITDA before special items
DKKm
Environment – Reduction in scope 1 and 2 CO
2
Kg/m
3
Social - Lost time incidents frequency
(LTIF)
Source: OECD, Destatis, NHBC, Statistics Poland
11%
We achieved 11% lower scope 1 and
2 intensity (kg/m
3
) compared to last
year, making us well-aligned and on
track with our Science Based target.
-25%
The sales volumes dropped by 34%,
partly offset by price increases to
counter inflation.
-34%
Inflation and interest rates have triggered a
market downturn more severe than the 2008
financial crisis, leading to a 34% decrease in
sales volumes, in line with the building activity
in our markets.
244
In 2023, EBITDA before special items
was DKK 244 million corresponding to
a margin of 9% against a margin of 18%
last year.
150
Production was scaled back 30% after
closing nine plants. A total of DKK 250
million in run rate savings from indirect
cost and SG&A expenses.
3.6x
EBITDA decline has increased the net
interest bearing debt/EBITDA ratio.
6
Annual Report 2023
Performance highlights
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Five-year summary
Income statement (DKK million) 2023 2022 2021 2020 2019
Revenue 2,672 3,604 3,020 2,654 2,840
Gross profit before special items 564 1,020 905 836 877
EBITDA before special items 244 657 591 521 539
EBITDA 58 615 567 521 531
EBIT before special items 57 455 408 332 366
EBIT (230) 413 377 332 358
Profit before tax (283) 398 356 307 205
Profit after tax for the period (246) 317 321 251 150
Balance sheet (DKK million) 2023 2022 2021 2020 2019
Assets
1
3,454 3,572 3,400 2,909 2,716
Invested capital 2,435 2,142 1,852 1,865 1,809
Investments in property, plant, and equipment
2
165 266 197 134 126
Aquisition and divestment of enterprises - - 238 72 (20)
Net working capital 359 242 65 55 48
Equity 1,678 1,938 1,814 1,509 1,371
Net interest-bearing debt (NIBD) 887 492 350 230 407
Cash flow (DKK million) 2023 2022 2021 2020 2019
Cash flow from operating activities (209) 316 454 425 369
Cash flow from investing activities (137) (255) (427) (206) (105)
Cash flow from financing activities
1
131 (80) (25) 6 (131)
Free cash flow (346) 61 27 219 264
Financial ratios and others 2023 2022 2021 2020 2019
Sales volume (thousand m
3
) 2,745 4,187 4,326 4,022 4,494
Organic growth (25%) 14% 13% (6%) 6%
Gross margin before special items 21% 28% 30% 31% 31%
EBITDA margin before special items 9% 18% 20% 20% 19%
EBITDA margin 2% 17% 19% 20% 19%
EBIT margin before special items 2% 13% 14% 13% 13%
EBIT margin (9%) 11% 12% 13% 13%
Return on invested capital (ROIC) (excl. goodwill)
3
(9%) 19% 20% 18% 20%
Solvency ratio 46% 52% 50% 50% 49%
Financial gearing before special items 3.6x 0.7x 0.6x 0.4x 0.8x
ESG data 2023 2022 2021 2020 2019
Social
Average number of FTEs 1,500 1,738 1,572 1,619 1,685
FTE's, end of reporting period 1,261 1,739 1,663 1,571 1,636
Lost-time incident frequency (LTIF)
4
3.4 3.6 5.5 5.7 5.6
Sickness absence, short-term (days per FTE) 10 11 10 11 11
Environmental
Total energy per m³ (MJ) 575 567 554 551 565
Scope 1+2 intensity (kg/m
3
) 36 40 45 46 46
Scope 1+2 emissions (tonnes)
4
108,800 176,250 191,806 178,363 199,209
Scope 3 intensity (kg/m
3
) 146 157 157 157 162
Total GHG emissions per net revenue (tonnes/DKKm) 206 240 287 302 315
2019 - 2021 numbers have not been adjusted to the change in accounting policy for presenting cash pool. For more details see general accounting policies page 87.
Investment in property, plant, and equipment excludes effects from IFRS 16.
Due to the acquisitions the method for calculating Return on invested capital (ROIC) has changed to better reflect a true and fair view.
ROIC for the period 2019-2021 has been calculated as Operating profit (EBIT) relative to average invested capital (excluding goodwill) on a twelve-month basis.
ESG figures for 2023 subject to limited assurance.
Note: Financial ratios and ESG measures have been calculated in accordance with recommendations from the Danish Society of Financial Analysts. See page 77 and 119.
7
Annual Report 2023
Five-year summary
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Financial stability
in challenging
market
conditions
Chair letter
After many years of high activity in the building industry,
our markets experienced increased pressure due to rising
interest rates, leading to more projects being cancelled or
postponed. In response, we implemented substantial cost-
cutting measures to adapt to the lower market demand.
A key focus was placed on enhancing the efficiency of our plant
network. This involved consolidating plants and redirecting
production to larger sites. By unlocking the potential of our
remaining assets, we can deliver the same capacity at a lower
cost. These changes are a key driver for our long-term growth
and profitability.
We have implemented significant cost-cutting measures, and I
am pleased with the progress we have achieved in aligning our
operations with current demand. During this period, it has been
necessary to part ways with some of our good colleagues and
on behalf of the Board I extend the deepest gratitude for their
dedication and hard work.
Financial management
In these challenging times, our commitment to prudent financial
management stands as a fundamental aspect in our strategy.
We are dedicated to preserving cash and rigorously evaluating
our capital projects to ensure they contribute to our focus on
enhancing the efficiency of our existing assets.
During the year we have sold land plots, spare kits and sandpits
in Germany from some of the sites that were closed during the
year. These divestitures aligns with our broader strategy to focus
on core business operations and reduce net debt.
In 2023, H+H signed a new multi-currency sustainability-linked
financing agreement, and I am pleased that this agreement
supports our business and helps us through in these challenging
times.
Kent Arentoft
Chair
8
Annual Report 2023
Chair letter
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Building a sustainable business
Sustainability continues to be a core aspect of both our strategy
and daily operations, and we believe that our strategy and busi-
ness model are compatible with the transition towards a sustain-
able economy. We are committed to decreasing our carbon
emissions in accordance with our Science Based Targets and
achieving net-zero emissions by 2050, aligning with the objec-
tives of the Paris Agreement and the EU's climate goals.
In 2023, we made progress against our carbon reduction targets
as we were able to reduce our carbon intensity emissions to a
record low, reflecting the actions and investments we have made
to improve the CO
2
footprint of our plants. Our plants are now
consuming an average of 75% renewable electricity, and we have
continued our energy mix improvement by converting an addi-
tional coal boiler to natural gas in Poland. Both are in line with our
initial goal for 2023.
Looking ahead
Significant macro-economic headwinds continue to impact us,
and it is difficult to predict the shape of the economy in 2024
and the route to recovery from the current low point. Within the
Board, our commitment remains strong as we navigate through
this challenging period. We actively address and manage associ-
ated risks, ensuring that our strategy remains fit for purpose in
this market environment and that H+H is strategically positioned
to create long-term value for our stakeholders.
We know that across our key markets there is still an under-
supply of housing. With this underlying housing demand, we are
confident that markets will rebound – the uncertainty is when.
However, with the adjusted business setup, H+H can sustain a
market with the current building activity. This ensures that we
will generate positive cash flow and over time return the debt
position to the long-term target of 1-2x net interest bearing debt
to EBITDA. We remain committed to the long-term fundamentals
of our business and uphold our financial targets, aiming for an
EBIT margin of 12% and a Return on Invested Capital (ROIC) of
16%.
Finally, on behalf of the Board of Directors, I would like to express
my gratitude to our employees, for their resilience to overcome
challenges during a year that was marked by high volatility and
uncertainty. And, to our customers, business partners and
investors, thank you for entrusting us to help meet your needs
and for helping us meet ours.
Kent Arentoft
Chair
Long-term financial targets
EBIT margin
Return on invested capital (ROIC)
Financial gearing
(Net interest-bearing debt to EBITDA)
12%
16%
1-2x
Please see page 22 for long-term target assumptions
9
Annual Report 2023
Chair letter
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Transforming
through
the market
downturn
CEO letter
In 2023, we witnessed changes at an unprecedented
speed, which posed significant challenges differing
significantly from the economic downturn of 2008.
Despite building permits reaching comparable lows,
the swift rise in interest rates has been the main driver
of change. This has significantly impacted mortgage
affordability, making building difficult for many.
Responding to changes in market dynamics
In response to the market decline, we implemented a business
improvement programme early in the year. Our priority was to
adjust the fixed cost base of our operations. We have perma-
nently closed five plants and temporarily closed four others.
Our strategy from the outset was to redirect volumes to larger,
high-performing plants. In total, we have reduced our work-
force by close to 30% and have significant reduced fixed costs
allowing us to produce at previous comparable efficiency levels.
Our decisions were not only driven by short-term capacity
adjustments but also follow a strategic network optimisation
plan for our plants. This means we have identified enough
capacity opportunities to service our customers not only this
year but also when the markets start to pick up again. Despite
the current low demand, we are implementing a lean manufac-
turing programme which will allow us to run our network even
more efficiently. Our current investment in our plant in South
East England, which will lead to a 20% increase in capacity, is a
perfect example of this. Additionally, we have adjusted our SG&A
expenditures in all regions and are now operating at lower levels.
Next to the fixed cost improvements, we strengthened our group
procurement function early in the year. Several initiatives helped
to mitigate the effects resulting from high inflation. On top of
those savings, I am pleased that we managed to implement
double-digit price increases, which, in combination with procure-
ment, helped to protect our margins.
Implementing these improvement measures required a huge
effort by the entire organisation, and I am pleased to witness
our teams' agility and execution power. I believe we have demon-
Jörg Brinkmann
CEO
10
Annual Report 2023
CEO letter
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
strated how quickly we can change and adjust to challenging
market conditions.
Zero Harm and CO
2
emissions
In 2023, we adjusted production on a scale that can have a
notable impact on safety. Consequently, I am pleased to report
that over the course of the year, we achieved a record low LTIF
rate.
Providing a safe and healthy workplace for our employees and
contractors remains our number one priority regardless of
market conditions. To reach our goal of zero incidents, we have
launched a new strategy across the group called Zero Harm. This
initiative marks the next phase in our journey towards opera-
tional excellence and safety enhancement.
2023 was also a milestone for our CO
2
emissions, lowering our
intensity by 11%. Regardless of market conditions we continue
to execute on our energy optimisation strategy. Beyond that, the
closure of less efficient plants supported our CO
2
reductions. A
prime example of how financial and environmental targets go
hand in hand.
Sustainability is a strategic enabler of growth and H+H remains
committed to supporting the sustainable transformation of
Europe’s cities and communities by developing products and
applications that increase energy efficiency and lower the life-
cycle emissions of buildings.
Looking ahead
We anticipate that the challenging macroeconomic environment
will persist into 2024. A stabilisation of interest rates or the initi-
ation of government support schemes, are both essential for the
markets to change. However, the demand for housing remains
strong across all our markets and it is a matter of time before we
see an increase in house purchases again.
As we move into 2024, we do so with confidence. Operating on
a significantly lower fixed cost base will help us to protect our
earnings. Beyond this, it is our permanent focus to uphold price
discipline, while maintaining our market leading position. This,
combined with inventory reductions, tight cost management and
low investment levels, will help us deliver a positive cash flow and
support our target of lowering debt.
Finally, I would like to thank our employees for their dedicated
and engaged way of undertaking new ways of working and
servicing our customers, and I want to thank our partners and
customers for their loyalty and support. We look forward to
continuing our collaboration in 2024.
Jörg Brinkmann
Chief Executive Officer
A primary objective for 2024 is to uphold price discipline, protecting our market
leading position while keeping a strong focus on cash management. In addition, we
continue working on improving the efficiency of our plant network, optimising the
performance of our existing plants.
11
Annual Report 2023
CEO letter
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
We remain in a unique position due to our underlying growth drivers and our strong
operating platform and because we have the material of choice for builders that offers
a sustainable solution
Underlying growth drivers
• Demographic growth and changing
housing needs
• Structural undersupply of housing in
all of our markets
• Fragmented markets with room for
consolidation and further M&A
• High entry barriers for new entrants
Material of choice
• Multifunctional, easy-to-install products with
minimal maintenance and cost-effective
materials for affordable solutions
• A fire-resistant, rot- and mould-proof
product ensuring a safe and healthy indoor
environment
• Long life-time expectancy, which will benefit
the climate and the environment
Sustainable solutions
• CO
2
-absorbing abilities
• SBTi commitment in line with the
1.5-degree scenario
• Recyclable and long-lasting products
• Net-zero emissions by 2050
• High insulating and energy efficient
properties
Strong operating platform
• European market-leading position in aircrete
(AAC) and calcium silicate (CSU)
• Value-added customer relationships and
assistance through entire building process
• Strong plant network and a leading operating
model allow for capacity increase within
existing plants
Equity story
12
Annual Report 2023
Equity story
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Outlook
Specific assumptions
H+H's financial outlook is based on several
specific and general assumptions, with
management identifying the most important
assumptions as follows:
• Building activity in line with 2023 level
• Price discipline maintained in our key
markets
• Exchange rates, primarily GBP, EUR and PLN
remain at end-February 2024 levels
Unwinding unfavourable gas contracts
In the summer of 2022, H+H entered gas
contracts with fixed price and volumes in
certain markets covering the period Q2 2023
to Q1 2026. Due to the extraordinary fluctua-
tion in gas prices at the outset, these hedges
are unfavorable compared to current market
prices.
We have considered alternatives and decided
to unwind the hedges as of 31 March 2024. The
unwinding will have following impact for 2024:
• The difference between the fixed price and
the market price for the remaining contract
period will be recognised as a one-off loss of
around DKK 95 million, classified as special
items in Q1 2024
Given the assumptions outlined below, the oulook for 2024 is as follows:
Revenue growth measured in local currencies
is expected to be between
-5% to +5%
EBIT before special items is expected to be
(DKKm)
50 to 150
Forward-looking statements
The Annual Report contains forward-looking statements. Such statements are subject to risks and uncertainties, as various
factors, many of which are beyond the control of H+H, may cause actual developments and results to differ materially from the
expectations expressed in this document. In no event will H+H be liable for any direct, indirect or consequential damages or any
other damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other action
arising out of or in connection with the use of information in this document.
• The unfavorable hedges will impact the costs
of goods sold in H1 2024 by approximately
DKK 45 million until they are unwound from
the inventory
• Lower volumes will lead to the sale of unused
hedged gas in the market in the first quarter,
resulting in financial losses classified as
special items of around DKK 15 million
• The unwinding will not affect the original
cash flow timing of the hedges, as the instal-
ments will continue to follow the original
payment terms
• A new hedging agreement has been entered
to cover a proportion of the expected gas
volumes in the relevant markets for the
remainder of 2024
And following general assumptions
• Sales volumes and product mix
• Price competition
• Developments in the market for building
materials
• Distribution factors
• Weather conditions
• Macroeconomic and geopolitical devel-
opments
• Operational uptime at H+H’s production
plants including supply of energy and
raw materials
13
Annual Report 2023
Outlook
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Business and
strategy
15 Business model
16 Products and solutions
17 Strategic focus areas
22 Long-term targets
Picture of the Pollington lagoons, which
take all condensate water from the auto-
claving process, all surface water from
the yard, and all reject water from any
on-site water filtration systems, we have.
With these, we recycle an estimated
60% of our total water use on site.
14
Annual Report 2023 In brief Sustainability statementBusiness and strategy Results Governance Financial statements
• Sand, water and lime
• Cement and aluminium added
for AAC
• Strong plant network with
national coverage
• Lean manufacturing process to
improve efficiency and eliminate
waste
• Targeted capital investments
improve reliability and quality
across the production platform
• Continuous improvements to
deliver sustainable margins
• Full wall solution selling
• Support of customers in early
planning stage
• Optimisation of building
process
• Cooperation with planners,
installers, architects,
distributors and house
builders
• One-point of contact
• One-stop shop for wall
building
• Reliable and timely delivery
• Multifunctional, easy-to-
install products with minimal
maintenance and cost-
effective materials
• Fire-resistant, rot- and mould-
proof product
• Long life-time expectancy for
the benefit of the climate and
environment
Partnerships Delivery Key featuresManufacturingKey raw materials
Efficient manufacturing
Attractive geographical setup
Partners in wall building
One-stop shop for every wall-building project
Enabling better homes
Diverse and flexible solutions for various applications
Business model
We focus on providing safe, sustainable and affordable
solutions and materials for wall building
The business model is prepared in accordance with SBM-3 – Material impacts, risks and opportunities and their interaction with strategy and business model
15
Annual Report 2023 In brief
Business model
Sustainability statementBusiness and strategy Results Governance Financial statements
16
Annual Report 2023 In brief
Products and solutions
Sustainability statementBusiness and strategy Results Governance Financial statements
Strategic
focus areas
The construction industry saw an
unprecedented downturn in 2023. Despite this,
the foundation for future growth remains. There
is a structural undersupply of homes across our
markets, and we have the builders’ material of
choice for wall building projects.
We are in a cyclical business and as a consequence of the down-
turn, we have shifted our focus from growth to stabilising the
business. We have analysed and adapted our production plat-
form to the current market environment, and the emphasis on
cash has increased.
Adaptation to the current business environment is driven by a
strong focus on operational excellence and cash generation, but
also in a way where H+H is well positioned for a market recovery
with the aim of restoring and improving profitability.
Unlocking the potential of our production network
Over the recent years, our company has expanded through
multiple acquisitions. In 2023, a strategic review led us to identify
inherited plants within our network that were no longer essential
for our footprint. This decision was influenced by analysis that
showed capability of meeting previous high production volumes
with fewer plants by optimising the efficiency of our remaining
plants. As an example, some plants consistently operated at
lower energy efficiency rates than our other plants. This gap in
performance not only highlighted their obsolescence but also
underscored the need for modernisation of our approach to
manufacturing efficiency. Shifting production volumes from
closed plants to larger, more efficient facilities leads to cost
reductions via economies of scale.
As a result, we permanently closed five plants and temporarily
closed four others during 2023. In total, restructuring costs
amounted DKK 133 million, classified as special items, and we
achieved DKK 150 million in cost savings for the year from SG&A
and indirect production costs. For 2024, we expect further DKK
100 million in savings from these initiatives.
We are partners
in wall building
Collaboration creates
lasting value – both for
customers, suppliers,
and other stakeholders.
We strive to be the ideal partner and a
one-stop-shop for every wall-building project,
adding value at every stage of the building
process. By understanding industry trends,
our customers, and their specific needs,
we can help solve challenges and manage
complexities with the aim of building safe,
sustainable, and affordable homes.
We constantly strive to find new ways to
improve our products and building concepts
to make building better, easier, and more
efficient for everyone involved – from sourcing
and production to distribution and building
sites.
Sustainability is a key strategic priority and
an integral part of all our activities. We have
an environmental focus on production and
we take the environmental impact of the use
of H+H’s products over their lifetime into
account.
17
Annual Report 2023 In brief
Strategic focus areas
Sustainability statementBusiness and strategy Results Governance Financial statements
Non-producing plants Producing plants
0
1,000
MJ/m
3
Better eciency going forward
30% GAP
Original rykket 100 mm
Non-producing plants Producing plants
Better eciency going forward
30% GAP
Investing in plant efficiency
At H+H we are always looking to improve our processes
to better meet the needs of our customers.
In 2023, works started in Borough Green on a new
autoclave holding area, an additional packing line and
a new pallet feeding system. In order to maintain and
enhance aircrete as the building material of choice, it is
essential that we optimise our production process. The
project will be completed in Q2 2024 and the upgrade
will increase plant capacity by up to 20%.
The improvements being made will enable us to support
our long-term customer partners and help safeguard
the future of H+H in the UK.
The upgrade, set for completion in
Q2 2024, will increase the plant
capacity by up to 20%. It's a
step forward in supporting our UK
customers over the long term.
Tom Malcolm
Plant manager, Borough Green, H+H UK
Additionally. the plants identified for closure did not have the
required development opportunities and there were some
geographical overlap to other plants. With these closures, invest-
ments can be targeted at the continuing plants whilst ensuring
that our presence and market reach in the regions remain intact.
We maintain our capability to service our customers when the
markets recover, as our network of plants can be scaled. This can
be achieved as we target future investments improving uptime
and debottlenecking projects. Together with a lean manufac-
turing approach and continuous improvements we will improve
efficiency and effectiveness. Examples of this could be improved
energy efficiency leading to more carbon-friendly products,
Graph showing the significant gap in efficiency between our continued and closed
plants during the first half of the year, prior to the restructuring
Energy performance – HY1 2023
Picture of the expansion
works at the Borough
Green plant in the UK
which began end of 2023.
18
Annual Report 2023 In brief
Strategic focus areas
Sustainability statementBusiness and strategy Results Governance Financial statements
improved raw-materials consumption and reduced waste. A
market recovery will unlock the full potential of our plants and
making the right investments in the right sequence are key to
securing a proper return on invested capital.
SG&A cost savings in CWE
For the business unit in Central Western Europe (CWE, consisting
of Germany, Switzerland, Benelux and Scandinavia) key focus
area in 2023 was to adjust the production footprint to the new
market situation which has been successfully completed. For
2024, a suite of projects related to internal business processes
and finalisation of the Group ERP solution will be carried out.
The projects will lead to a significant turnaround. To support the
changes, the administrative staff were relocated to a new office
in Düsseldorf in 2023. This will improve the internal business
processes and allow us to optimise the cost structure. The target
is to bring the financial performance of the CWE region on a par
with our financial performance in the UK and Poland.
Cash management
As we have closed plants, we have been working on divesting
the non-core assets during 2023. During the year, we have sold
land plots, spare kits, and a sandpit in Germany. Going forward,
capital expenditures (CAPEX) will remain low until the debt
gearing is in line with the long-term strategic target. In total we
reduced CAPEX by DKK 100 million compared to last year. The
key focus for CAPEX is to support our aspiration to unlock the
potential of our production network, enabling us to deliver the
volume needed from fewer sites.
To address input costs, a group procurement function was
established in 2023. The group procurement function is
designed to coordinate tenders and utilise market opportunities
for key categories. This is both in the form of lower purchase
prices, but also via product substitution and harmonisation of
processes.
During the past years, we have made a number of acquisitions in Germany.
Having the majority of our administrative staff centralised in one location,
gives us an excellent starting point for expanding collaboration,
improving our processes and optimising our cost structure.
Andreas Böttger,
Managing Director, H+H CWE
With the current financial performance, the cash focus remains
on the existing business. However, acquisitions could become
relevant in the mid-term, when initial market recovery prevails
and the financial conditions support this. In the meanwhile an
acquisition pipeline is maintained with the focus on further
strengthening the geographical footprint. This may also include
diversifying our product offering with other wall-building mate-
rials, potentially unlocking new growth potential and synergies.
Key priorities for 2024
• Focus on cost-saving measures, further improving
uptime and continuous improvement within our
plants
• Focus on price quality and procurement to leverage
market opportunities for lower input costs
• Implementing SG&A cost savings, supported by
standardised business processes and digital tools,
with a primary focus on integrating CWE into a single
organisation following acquisitions in the last five
years
• Focus on cash management and generating positive
cash flow for 2024
19
Annual Report 2023 In brief
Strategic focus areas
Sustainability statementBusiness and strategy Results Governance Financial statements
0
2014 2016 2018 2020 2023
15
12
9
6
3
Next step towards zero incidents
Managing the health and safety risks from the heavy equip-
ment and harmful substances used in the production process
is essential for us as an employer. Maintaining a strong safety
performance underpins our operations and enables us to provide
healthy, safe, and secure working conditions for employees
and contractors. To reach our goal of zero incidents, we have
launched a new simplified strategy across the group called
Zero Harm. The strategy is designed to create awareness of the
importance of behavioural safety and was kicked off with visits to
three flagship sites in Hamm, Zelislawice, and Pollington.
The strategy is further supported by
additional initiatives including:
• A tailored programme of workshops for all operational super-
visors and managers
• Investment in plants where needed to keep them safe
• Implementation of preventative actions based on previous
incidents
• Executing site safety improvement plans each year
LTIF rate
Zero
incidents
As part of the Zero
Harm launch, new
PPE was handed out
to all employees.
20
Annual Report 2023 In brief
Strategic focus areas
Sustainability statementBusiness and strategy Results Governance Financial statements
-70kg
% of reduction
(CO
2
e per m
3
)
% of reduction
(CO
2
e per m
3
)
(Kg CO
2
e per
m
3
AAC unit)
180kg -77kg
% of reduction
(CO
2
e per m
3
)
-24kg
% of reduction
(CO
2
e per m
3
)
-22kg
(-69%)
(-43%)
(-13%) (-13%)
Net-zero
emissions
-125kg
* Numbers have been rounded and may not add up | EAACA – Net-zero roadmap for autoclaved aerated concrete | 1 E1-1 – Transition plan for climate change mitigation |
2 Derived from a representative AAC plant (normalised to an average dry density of 388 kg/m3, year under review 2020)
Condensed generic product roadmap for AAC: From 180 kg to -70 kg of CO
2
e per m
3
by 2050*
Today Recarbonation
Optimising
plants
Other
decarbonisation
processes
Total carbon-
footprint by
2050
Recarbonation
2
Total Co
2
e per m
3
is reduced by 43%
(77kg) due to the
recarbonation
features of limestone
Decarbonising our products
1
Our business model and strategy are compatible with the transi-
tion to a sustainable economy by reducing our carbon emissions
in line with our validated Science Based Targets and our target
of net-zero emissions by 2050. Our a roadmap includes the
following levers:
1. Increasing the share of renewable energy
2. Optimising plants including investments in energy efficient
equipment
3. Improved energy mix, including a transition away from coal
4. Supply-chain decarbonisation, in particular, to reduce emis-
sions from the production of lime and cement which represent
most of H+H’s scope 3 emissions
The full roadmap from the European Autoclaved Aerated
Concrete Association (EAACA) shows that with the combination
of our decarbonisation strategy as well as the recarbonation
features of limestone, we will be able to produce blocks that have
a negative carbon footprint. This underlines that our prod-
ucts are and continue to be a part of the solution in producing
sustainable housing.
Low carbon
cement and lime
21
Annual Report 2023 In brief
Strategic focus areas
Sustainability statementBusiness and strategy Results Governance Financial statements
Long-term
targets
Sustainability targets
Financial targets
EBIT margin
H+H commits to
reducing absolute
scope 1 and 2 greenhouse
gas emissions by
Return on invested capital
Excl. goodwil
H+H commits to reducing
scope 3 greenhouse gas
emissions by
Financial gearing
Net interest-bearing debt to
EBITDA
H+H commits to achieving
net-zero emissions in our
operations and products by
by 2030 compared to 2019 per kg CO
2
e/m
3
by 2030
compared to 2019
12%
46%
16%
22%
1-2x
2050
.
Despite the ongoing economic challenges and
the current building activity, we maintain our
long-term financial targets.
The targets are based on the assumption of
a market recovery and increased housing
activity levels over the coming three to five
years. Furthermore, the key drivers for
achieving the targets include:
• A continued favorable market share compar-
ison of AAC/CSU relative to other building
materials
• Ability to pass through cost increases
• Continued efficiency gains in operations and
SG&A
22
Annual Report 2023 In brief
Long-term targets
Sustainability statementBusiness and strategy Results Governance Financial statements
Results
24 Full year financial review
26 Q4 2023 results
27 Sustainability performance
28 Our geographical footprint
29 The United Kingdom
31 Central Western Europe
34 Poland
Blocks being loaded onto a
truck in Hamm, before being
sent out to customers.
23
Annual Report 2023 In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Income statement
Revenue
Total revenue decreased by 26% to DKK 2,672 million compared
to DKK 3,604 million in 2022. Organic growth was negative 25%
in 2023 compared to positive 14% in 2022.
Organic growth was driven by lower sales volumes and partly
offset by sales price increases across all markets to counter the
continued inflationary pressures.
Revenue in Central Western Europe amounted to DKK 1,256
million compared to DKK 1,611 million in 2022. In a challenging
environment, we were able to outperform the market with an
organic growth that was negative 20%.
Revenue in the UK amounted to DKK 763 million compared to
DKK 1,052 million in 2022. Organic growth was negative 25% but
we increased our market share by onboarding new customers
and re-entering the market for foundation blocks.
Revenue in Poland was DKK 653 million compared to DKK
941 million in 2022. Organic growth was negative by 31% in a
competitive market.
Gross profit before special items
Gross profit was DKK 564 million compared to DKK 1,020 million
in 2022, corresponding to gross margins of 21% and 28%,
respectively. The decrease in gross profit margin is driven by
overhead costs spread over lower volumes and increased energy
costs, which includes a negative impact of DKK 55 million from
unfavourable gas hedges.
EBITDA before special items
EBITDA before special items in 2023 decreased by 63% to DKK
244 million compared to DKK 657 million in 2022, corresponding
to EBITDA margins of 9% and 18%, respectively. Adjusted for the
unfavourable gas hedges EBITDA before special items would be
DKK 299 million corresponding to a margin of 11%.
Depreciation and amortisation
Depreciation and amortisation amounted to DKK 187 million
compared to DKK 202 million in 2022. The decrease is driven by
the impact from the closed down plants.
EBIT before special items
EBIT before special items amounted to DKK 57 million compared
to DKK 455 million in 2022, corresponding to EBIT margins of
2% and 13%, respectively. Adjusted for the gas hedges EBIT
before special items would be DKK 112 million corresponding to a
margin of 4%.
Special items
Special items of DKK 287 million in 2023 mainly comprise of
impairment of non-current assets, restructuring costs asso-
ciated to the strategic adjustment of our production capacity,
including close down of certain plants, and the ineffective part of
gas hedges.
Please refer to Note 7 for more information.
EBIT
EBIT was negative DKK 230 million in 2023 compared to DKK
413 million in 2022.
Net financials
Net financials amounted to an expense of DKK 53 million in 2023,
compared to an expense of DKK 15 million in 2022. The develop-
ment is mainly driven by an increase in interest expenses from
higher interest rates and debt position.
Result before tax
Result before tax amounted to a loss of DKK 283 million
compared to positive DKK 398 million in 2022.
Tax
Tax for the year amounted to a net income of DKK 37 million
compared to a net expense of DKK 81 million in 2022 driven by
the lower result in 2023 compared to 2022.
Full year financial review
24
Annual Report 2023 In brief
Full year financial review
Sustainability statementBusiness and strategy Results Governance Financial statements
Result for the year
Result for the year was negative DKK 246 million, compared to
positive DKK 317 million in 2022.
Loss for the period is attributable to H+H International A/S’
shareholders by DKK 248 million and a profit to non-controlling
interest by DKK 2 million compared to a profit of DKK 303 million
and DKK 14 million, respectively, for 2022.
Comprehensive income
Other comprehensive income for 2023 was positive DKK 3
million compared to DKK 0 million in 2022. The year-on-year
movement was a result of actuarial loss net of tax of DKK 53
million and movements in fair value adjustment of derivative
financial instruments of DKK 7 million offset by a positive devel-
opment in foreign exchange rates of DKK 63 million.
Cash flow
Operating activities
Cash flow from operating activities before financial items and
tax amounted to negative DKK 110 million in 2023 compared to
positive DKK 388 million in 2022. Development in operating cash
flow is led by lower earnings in 2023 compared to 2022 and a
negative development in working capital due to an increase in
inventories in beginning of the year.
Total cash flow from operating activities in 2023 was negative
DKK 209 million against positive DKK 316 million in 2022.
Investing activities
Cash flow from investing activities in 2023 amounted to negative
DKK 137 million compared to negative DKK 255 million in 2022
mainly due to lower investment.
Financing activities
Cash flow from financing activities amounted to positive DKK 131
million in 2023 compared to negative DKK 80 million in 2022.
The year-on-year increase was mainly driven by draw on credit
facilities due to the development in earnings and working capital,
and the purchase of treasury shares in 2022.
Balance sheet
On 31 December 2023, the balance sheet total amounted to DKK
3,454 million compared to DKK 3,572 million on 31 December
2022 mainly driven by shifts in the net debt position partly offset
by an increase in inventories of DKK 134 million.
Net interest-bearing debt
Net interest-bearing debt amounted to DKK 887 million as of 31
December 2023 corresponding to an increase of DKK 395 million
since 31 December 2022.
On 31 December 2023, financial gearing was 3.6 times net inter-
est-bearing debt to EBITDA before special items.
The net interest-bearing debt to credit institutions totalled DKK
768 million on 31 December 2023 .
The increase in net interest-bearing debt since the beginning
of the year was primarily driven by negative net working capital
development in Q1 due to inventory build up and other cash flows
from operations.
Equity
The consolidated equity decreased by DKK 260 million
compared to 31 December 2022. Equity attributable to H+H
International A/S’s shareholders and non-controlling share-
holders was DKK 1,592 million and DKK 86 million, respectively.
Management review for the parent company
Result for the year was DKK 125 million compared to DKK 108
million in 2022. The increase of DKK 17 million against last year
was driven by higher dividend received in 2023 partly offset by
higher interest expenses.
Events after the balance sheet date
On 5 March 2024, H+H decided to utilise an unwinding option
in the hedging agreement for contracts initiated in the summer
of 2022. This action unwinds the unfavourable hedges as of 31
March 2024, and the difference between the fixed price and the
market price for the remaining contract period will be recognised
as a one-off loss of around DKK 95 million, classified as special
items in Q1 2024.
25
Annual Report 2023 In brief
Full year financial review
Sustainability statementBusiness and strategy Results Governance Financial statements
Q4 2023 results
2023 2022
(DKK million) Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1
Income statement
Revenue 601 699 731 641 810 920 1,000 874
Gross profit before special items 94 138 178 154 202 254 320 244
EBITDA before special items 32 53 87 72 111 160 227 159
EBIT before special items (15) 13 38 21 58 110 177 110
Result after tax for the year (109) (29) (101) (7) 34 82 129 72
Balance sheet
Invested capital 2,435 2,405 2,341 2,223 2,142 1,743 1,693 1,809
Investments in property, plant and
equipment 57 33 38 37 117 65 42 42
Net working capital 359 437 534 540 242 45 68 101
Equity 1,678 1,760 1,787 1,901 1,938 1,258 1,180 1,046
Net interest-bearing debt (NIBD) 887 844 875 804 492 471 602 659
Cash flow
Cash flow from operating activities (1) 87 (23) (272) 29 101 207 (21)
Cash flow from investing activities (35) (33) (45) (37) (106) (65) (42) (42)
Cash flow from financing activities (256) 16 168 207 73 (22) (70) -
Free cash flow (36) 54 (68) (309) (77) 36 165 (63)
Financial ratios
Organic growth (26%) (24%) (26%) (25%) 9% 7% 13% 29%
Gross margin before special items 16% 20% 24% 24% 25% 28% 32% 28%
EBITDA margin before special
items 5% 8% 12% 11% 14% 17% 23% 18%
EBIT margin before special items (2%) 2% 5% 3% 7% 12% 18% 13%
Note: Q4 2023 results are unaudited.
Comments relating to the fourth quarter of 2023
Revenue
Total revenue decreased by 25% to DKK 601 million compared to DKK 810 in
2022. Organic growth was negative 26% compared to positive 9% in 2022. Forth
quarter organic growth was mainly driven by lower volumes partly offset by sales
price increases.
Gross profit before special items
Gross profit was DKK 94 million compared to DKK 202 million in 2022, corre-
sponding to gross margins of 16% and 25%, respectively. The decrease in gross
profit margin was driven by overhead costs spread over lower volumes and
increased energy costs including a negative impact of DKK 23 million from unfa-
vourable gas hedges.
EBIT before special items
EBIT before special items was negative DKK 15 million in 2023 compared to posi-
tive DKK 58 million in 2022, corresponding to EBIT margins of negative 2% and
positive 7%, respectively. Adjusted for the gas hedges EBIT before special items
would be positive DKK 2 million.
Special items
Special items of DKK 81 million for Q4 2023 mainly relates to production capacity
adjustments and network optimisation costs. The unfavorable part of the gas
hedges amounted to DKK 14 million. For details, see Note 7.
Result after tax
Result after tax for 2023 was a loss of DKK 109 million, compared to positive DKK
34 million in 2022.
Operating activities
Cash flow from operating activities amounted to negative DKK 1 million in Q4
2023 compared to DKK 29 million in Q4 2022. Development in operating cash
flow is led by lower earnings for the period partly offset by a positive development
in working capital.
26
Annual Report 2023 In brief
Q4 2023 results
Sustainability statementBusiness and strategy Results Governance Financial statements
Kg/m
3
32
36
40
44
48
2019 2020 2021 202 2 2023
Already on track
with 2024 target
Kg/m
3
2019 2020 2021 2022 20242023
140
150
160
170
Sustainability performance
Scope 1+2 kg per m
3
results Scope 3 intensity - SBTi performance
Emissions Unit
SBTi
2019
SBTi
2023
Actual
2023
Scope 1+2 Tonnes 212,997 177,368 *108,800
Scope 1+2 kg/m
3
45.3 35.8
Scope 3 intensity kg/m
3
161.3 148.4 145.5
SBTi 2019 figures are rebased due to acquisitions, in accordance with SBTi guidelines
* ESG figure subject to limited assurance
Intensity per m
3
2019 2020 2021 2022 2023
Scope 1+2 Co
2
kg 46 45 45 40 36
On track with our science-based targets –
not losing focus despite market downturn
H+H was the first AAC and CSU manufacturer
to commit to SBTi and this year’s climate
results show how far we have come in elevating
and integrating ESG into our business.
During 2023 we have seen a significant market
decline and thereby also had to adjust our plant
network and operational procedures. Despite
these challenges, we have maintained our
focus on executing our sustainability strategy
by using less coal, closing inefficient plants and
sourcing more carbon-friendly raw materials.
This has resulted in record-low intensity
emissions for both scope 1+2 (35.8 kg/m
3
) and
scope 3 (145.5 kg/m
3
). We are therefore well
on track with our targets and will continue our
efforts into a challenging 2024.
Scope 1+2 intensity per m
3
Scope 3 SBTi
Scope 3 actual
27
Annual Report 2023 In brief
Sustainability performance
Sustainability statementBusiness and strategy Results Governance Financial statements
Aircrete plants (AAC) Calcium Silicate plants (CSU)Headquarter
Central Western Europe
Share of Group revenue in
2023
47%
The United Kingdom
Share of Group revenue in
2023
29%
Poland
Share of Group revenue in
2023
24%
Our geographical
footprint
We have a diversified geographical footprint with
our activities spread across three core regions,
namely Central Western Europe (comprising
Germany, the Nordics, the Benelux countries,
the Czech Republic and Switzerland), the United
Kingdom and Poland. We have a leading position
in most of our markets with solid market shares
and strong customer relationships.
Total plants
27
AAC
14
CSU
13
28
Annual Report 2023 In brief
Our geographical footprint
Sustainability statementBusiness and strategy Results Governance Financial statements
2019 2020 2021 2022 2023
159,115
121,993
152,472
189,009
105,449
-44%
2019 2020 2021 2022 2023
877
639
884
1,052
763
-27%
The United
Kingdom
Revenue
DKKm
Total newbuild registrations
'000
~45%
H+H market share in AAC
763
2023 revenue, DKKm
-25%
2023 negative organic growth
3
Plants
188
FTEs
Source: NHBC
Rising interest rates impacted affordability,
causing many prospective homebuyers to put
their buying decision on hold over the past year.
As a result, the market saw mortgage approvals
decline, and overall new home registrations fell
compared to last year.
Market trends and conditions
The UK housing sector faced considerable challenges in 2023.
Mortgage rates continued to rise for the first three quarters of
2023. This, combined with high inflation, impacted negatively on
customer confidence and in turn had a significant impact on the
demand for new private houses and the need for construction.
This led to a significant drop in new home registrations, which
decreased by 44% compared to the previous year.
The British government needs to address the challenges of a
structural undersupply of housing and maintain the ambition
of delivering 300,000 new homes per year. It is estimated that
there will be a need for 3.7 million new homes in the next 25 years
which is the underlying reason for the need to increase the British
housing stock through the construction of new homes. As a
general election is due in 2024, we would welcome the introduc-
29
Annual Report 2023 In brief
The United Kingdom
Sustainability statementBusiness and strategy Results Governance Financial statements
tion of new government schemes aimed at assisting first-time
buyers and current homeowners in purchasing a home.
Looking ahead, the uncertainty remains high given the current
economic environment. However, since September 2023, mort-
gage rates and consumer confidence have stabilised which
implies that rates could begin to fall in 2024.
2023 results and key developments
As fewer houses were built, H+H UK has, through our long-term
trusted partner status, encouraged greater penetration into the
existing house design, below and above ground.
In 2023, many products experienced price reductions as a
strategy to boost sales and volume, enabled by lower costs for
raw materials and energy. Being a market leader, it was crucial
for H+H UK to uphold the value of AAC, underscoring the impor-
tance of quality, service and customer relationships. Thanks to
strong supplier relationships, we managed to mitigate the effects
on our key expenses. Ensuring a steady supply of high-quality
raw materials remained a top priority, with price negotiations
continuing throughout the year.
Capacity adjustments
Whilst we are investing in additional capacity for the medium to
long-term, current market demand has led to a need to manage
capacity in the short term. This includes adapting production
to reflect the desired inventory position by adjusting shifts and
by running fewer plants more intensely. The Pollington I plant
has been temporarily closed as production capacity at our other
plants combined with our inventories is sufficient in the current
market environment. Our plant in Borough Green will take over
some of the volume, especially after completion of the upgrade
project, which adds 10% more capacity to the total network.
Operator monitoring production performance
through our fully integrated OEE-software.
30
Annual Report 2023 In brief
The United Kingdom
Sustainability statementBusiness and strategy Results Governance Financial statements
2019 2020 2021 2022 2023
852
965
1,121
1,611
1,256
-22%
2019 2020 2021 2022 2023
222,678
232,208
248,688
217,617
163,982
-25%
Central Western
Europe
Revenue
DKKm
Building permits, Germany
'000
~20%
H+H market share in AAC
~15%
H+H market share in CSU
1,256
2023 revenue, DKKm
-20%
2023 negative organic growth
12
Plants
501
FTEs
In 2023, Central Western Europe was affected
by a severe slowdown in the housing market and
inflationary pressure on production costs. This
led to significant restructuring and reshaping of
the supply chain.
Germany
Market trends and conditions
In 2023, there was a notable decline of 25% in the number of
building permits issued compared to last year. Similarly, the
property market experienced a substantial reduction in new
mortgage loans for private investors, with a decrease of approx-
imately 35% in 2023 compared to 2022
1
. This decline in mort-
gage loans can be attributed to the prevailing high-interest rates,
which have discouraged potential borrowers.
The creation of affordable housing is one of the most pressing
social issues in Germany. The federal government have
previously communicated the goal of building 400,000 new
homes annually. including 100,000 publicly funded ones. This
Source: Destatis
1 Source: Deutsche Bundesbank
31
Annual Report 2023 In brief
Central Western Europe
Sustainability statementBusiness and strategy Results Governance Financial statements
is currently under pressure from the challenging economic
climate, rising building material costs, higher interest rates and a
shortage of skilled workers.
The German government have tried different initiatives to tackle
the challenges in the housing sector. Although well-intentioned,
the real effect of these measures on new build residential
construction is yet to be seen.
2023 results and key developments
2023 was off to a slow start and adverse weather conditions also
contributed to the decline in activity at the start of the year. In
comparison, the start of 2022 was characterised by extraordi-
nary demand and sales price developments. Furthermore, inven-
tories were built up during Q1 to maximise plant utilisation before
scaling back production. As the year progressed, the second half
continued to experience a slowdown, maintaining the trend set
in the earlier months. This highlighted the continued challenges
faced by the industry and the stark difference from the previous
year's robust start.
Despite the challenges of a more difficult market in Germany, we
were able to expand our market position, driven by our national
coverage including the AAC position in southern Germany while
effectively passing on inflation costs. Towards the end of the
year, there were announcements of increases in list prices for
2024.
In 2023, a key focus was placed on optimising the cost structure
for CWE. We aim to elevate our CWE business to an SG&A level
comparable to our Poland and UK business by 2025 reflecting a
significant turnaround in this region. This is a key focus area in
2024.
Capacity adjustments
Our recent acquisitions have successfully expanded our pres-
ence throughout Germany, leading to synergy potential in sales
and administration. Throughout the year, we have focused on
enhancing the efficiency of our plant network to leverage addi-
tional synergies. Consequently, in 2023, we made the strategic
decision to close three CSU plants located in Demmin, Kronau
and Niederrimsingen, further streamlining our operations.
In addition, we have temporarily paused production at two stra-
tegically chosen sites, one situated in the southern region and
the other in the northern region. Specifically, at our Wittenborn
facility, which houses two production lines for aerated concrete,
we have taken the decision to pause one of these lines. This move
is based on the assessment that our current supply needs can
be adequately met by a single production line, thus enhancing
efficiency without compromising supply reliability.
At the Feuchtwangen site in the southern region, supply through
our plant in Hamm is sufficient for the current market environ-
ment.
Pressure testing of blocks.
32
Annual Report 2023 In brief
Central Western Europe
Sustainability statementBusiness and strategy Results Governance Financial statements
H+H Nordics
Construction activity in the Nordics has experienced a signif-
icant decline in 2023 compared to 2022. The high inflation at
the beginning of the year, coupled with rising interest rates, has
resulted in a notable absence of first-time buyers in the housing
market.
Homebuilders experiencing lower sales are prompting us to
pursue more projects. We have particularly focused on supplying
townhouse projects aimed at the rental market.
In line with the rest of the organisation, we had to adjust our
organisation to align with the market situation. 2023 required a
different market approach, as H+H Nordics faced price pressure
from customers and competitors. Fortunately, we have strong
partnerships with our customers who are willing to invest in our
solutions and services.
Introducing EPDs on the Danish market
In 2023, H+H Nordics introduced product-spe-
cific Environmental Product Declarations
(EPD) on the Danish market.
An EPD is a standardised method for informa-
tion regarding energy and resource consump-
tion as well as the environmental impacts
arising from the manufacture, use and disposal
of a construction product. Product-specific
EPDs are calculated based on the recipes,
resources, production methods, waste and
transport from the specific plant in which they
are produced. They increase transparency and
help customers understand the full environ-
mental impact of our products enabling them
to make informed decisions when choosing
materials.
For H+H Nordics the development of EPDs has
been of great importance, and the feedback
from customers has been overwhelmingly
positive. For volume housebuilders, they can
be a competetive advantage even though it will
not become a legal requirement until 2025.
We are experiencing an increasing demand for
documentation from our customers, and it has been a key
element in our dialogue and at the top of the agenda during
negotiations. Being one of the companies in the Danish
market to supply these EPDs allows us to remain a
trusted partner to our customers.
Dorthe Storm
Managing Director, H+H Nordics
33
Annual Report 2023 In brief
Central Western Europe
Sustainability statementBusiness and strategy Results Governance Financial statements
2019 2020 2021 2022 2023
773
716
737
941
653
-31%
2019 2020 2021 2022 2023
268,483
276,154
341,041
297,985
241,097
-19%
Poland
Revenue
DKKm
Building Permits
~20%
H+H market share in AAC
~20%
H+H market share in CSU
653
2023 revenue, DKKm
-31%
2023 negative organic growth
12
Plants
551
FTEs
Source: Statistics Poland
In Poland, double-digit inflation rates affected the
financing of construction projects throughout
2023. However, the introduction of the
government's 2% safe mortage loan programme
marked a significant turning point for the industry,
boosting the issuance of building permits since its
launch.
Market trends and conditions
Since 2022, the Polish central bank has significantly raised interest
rates in response to double-digit inflation rates, impacting the
financing of both existing and new building projects throughout
2023. This situation led to a substantial decrease in the number
of building permits issued, down by 19% in 2023 compared to the
previous year, mainly driven by developers. However, throughout
the year we have seen a positive trend in building permits.
In 2023, the mortgage market experienced significant fluctuations.
In the first half of the year, high interest rates created a challenging
environment for those seeking housing loans.
However, in July, the landscape changed with the launch of the
government's safe 2% mortage loan programme. This initiative was
designed to provide more favourable loan conditions, by offering
a low, fixed interest rate of 2%, to stimulate the housing market
34
Annual Report 2023 In brief
Poland
Sustainability statementBusiness and strategy Results Governance Financial statements
and encourage borrowing. It sparked a surge
in demand for housing loans, with the third
quarter witnessing a nearly 200% increase in
loan applications compared to the same period
in 2022. The total number of building permits
has increased since the launch of safe credit
loan programme which has now been fully
utilised. The terminated programme is to be
replaced by a new subsidy programme in 2024.
Comparing 2023 to the previous year, there
was a PLN 18.4 billion increase in the value
of loans granted, marking a 40.5% rise
1
. The
outcome was significantly shaped by the low
baseline of 2022, with the growth in the second
half of 2023 primarily driven by the implemen-
tation of the 2% safe credit program.
2023 results and key developments
The market conditions in Poland lead to a
highly competitive environment. However, we
have implemented price increases as planned
during the year to pass on input costs and to
protect our margins. Going forward, we remain
committed to passing on inflation while closely
monitoring the market.
Capacity adjustments
Consistent with the broader organisational
strategy, we made capacity adjustments
throughout 2023 to align with the prevailing
market conditions. This involved moving
production from less effective sites to more
efficient plants. As part of this realignment, we
closed down our AAC plant in Warsaw and a
CSU plant in Pisz. Additionally, the CSU plant in
Ludynia was temporarily shut down to optimise
our production network.
Converting to gas in Gorzkowice
To reach our target of a 46% absolute
carbon reduction by 2030, we are
continuously updating our equipment
and processes. In early 2023, we
converted one of two coal-fired boilers
in Gorzkowice, Poland, into now being
gas-fired.
The benefit of the upgrade is two-fold:
as natural gas emits less than half the
emissions of coal and is also 10%+ more
energy efficient in generating steam, we
are able to achieve lower emissions and a
more efficient use of energy.
We estimate that the conversion will provide material
savings in energy efficiency and indirect costs as
well as lowering our emissions by up to 50%.
Wojciech Zdziechowski
Operations Director, H+H Poland
Przemyslaw Sztaboroski and Marian Misztela inspect
the steam boiler converted from using coal to now
using natural gas through the yellow pipes.
1 Source: Polish Credit Information Bureau
35
Annual Report 2023 In brief
Poland
Sustainability statementBusiness and strategy Results Governance Financial statements
Governance
37 Corporate governance
41 Board of Directors
43 Executive Board
44 Shareholder information
46 Risk management
Before being sent to the
packing line, our products are
inspected and all damaged
ones are discarded. The
discarded ones are then
recycled back into production.
36
Annual Report 2023 In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Corporate governance
Governance structure
The general meeting is the supreme governing
body of H+H International A/S where share-
holders can exercise their rights. At the annual
general meeting shareholders consider the
annual report, the remuneration report, the
election of board of director members and the
election of auditor, changes to the Articles of
Association as well as any other agenda items
proposed by the Board of Directors or share-
holders. The authority of general meetings and
the formalities relating to general meetings are
set out in the company’s Articles of Associa-
tion available on the group website.
Election of a member to the Board of Directors
requires simple majority of votes, and deci-
sions to make amendments to the Articles of
Association requires at least two-thirds of the
votes cast as well as of the share capital repre-
sented at the general meeting.
H+H International A/S has a two-tier manage-
ment system consisting of the Board of
Directors and the Executive Board. The Board
of Directors supervises the work of the Exec-
utive Board and is responsible for the Group’s
strategy and overall organisation, manage-
ment, and capitalisation. The Executive Board
is responsible for the execution of the strategy
and the day-to-day management. The organi-
sation and operation of the Board of Directors
are set out in the Rules of Procedure for the
Board of Directors, and similarly the organisa-
tion of the Executive Board and its co-opera-
tion with the Board of Directors are set out in
Rules of Procedure for the Executive Board.
The current Articles of Association state
that the Board of Directors must consist of
4-8 members elected at a general meeting.
Currently, the Board of Directors consists of
7 members. The term of all board members
expires at each annual general meeting, but
each member may be re-elected for a new
term. It is stipulated in the Articles of Associ-
ation that a board member may not also be a
member of the Executive Board.
To support the work of the Board of Direc-
tors, the Board of Directors has established
three board committees, namely the Audit
Committee, the Remuneration Committee, and
the Nomination Committee. The board commit-
tees are not authorised to make independent
decisions but shall report and provide recom-
mendations to the Board of Directors. The
members of each board committee, including
the committee chair, are each appointed by the
Board of Directors on the basis of their specific
competences.
Key activities 2023 - Board of Directors
• Review of strategy and business plan,
including new operational model to increase
production capacity and reduce emissions
• Acceleration of the execution of parts of
production network efficiency plan due to
the market downturn, enabling closure of 5
plants and temporary closure of 4 plants,
leaving 23 plants in operation.
• Review of resilience plans and their execu-
tion, incl. reductions of capex, costs and
working capital, review of financing etc.
• Review of supply risks, inflated pricing and
related hedging arrangements, especially for
energy
• Review of IT and cyber security and the
continued implementation of the group ERP
system
37
Annual Report 2023 In brief
Corporate governance
Sustainability statementBusiness and strategy Results Governance Financial statements
Key activities 2023 - Audit Committee
• Oversight of enterprise risk management,
including the ERM framework, risk appetite
principles, key risks and related mitigation
plans. Specific focus this year was put on
operational hedging principles
• Monitoring of group insurance strategy,
coverage, and pricing
• Review of sustainability reporting, including
the double materiality assessment, organi-
sation of ESG responsibilities etc.
• Monitoring financial reporting process,
including treatment and estimates,
accounting policies and the integrity of the
reporting process, as well as review of the
audit strategy
• Review of the annual and interim financial
reporting and the annual sustainability
reporting
Key activities 2023 -
Nomination Committee
• Recruitment of new board member elected
at the annual general meeting in March 2023
Attendance rates for board and committee meetings in 2023
Board
Meeting
Attendance
Audit
Committee
Meeting
attendance
Nomination
Committee
Meeting
attendance
Remuneration
Committee
Meeting
attendance
Kent Arentoft Chair 6/6 100% Chair 1/1 100% Member 1/1 100%
Jens-Peter Saul Vice Chair
3/5 60% Member 1/1 100% Member 1/1 100%
Stewart A Baseley Member
6/6 100% Member 1/1 100%
Volker Christmann Member
6/6 100% Member 4/4 100%
Kajsa von Geijer Member
6/6 100% Member 3/3 100% Member 2/2 100%
Miguel Kohlmann Member
6/6 100% Member 1/1 100% Chair 2/2 100%
Helen MacPhee Member
6/6 100% Chair 4/4 100%
Attended Not attended Not a member at the time
* Jens-Peter Saul was unable to attend the first two board meetings due to other commitments made prior to his appointment to the Board. However, he pre-read all board material and provided input to the Chair as well as the Executive Board prior to these two board meetings.
• Recruitment of new CFO (ongoing into 2024)
• Arrangement of the annual evaluation of the
Board and of the Executive Board and their
co-operation as well as the Board's collective
and the board members' individual compe-
tences
Key activities 2023 -
Remuneration Committee
• Annual review of the Remuneration Policy
for the Board of Directors and the Execu-
tive Board and of the annual Remuneration
Report
• Review of and proposal for the fees to the
Board of Directors and for remuneration to
the Executive Board
• Review of outcome under the incentive
programs vesting and proposal to the Board
of KPIs and targets for the short-term and
long-term incentive programmes starting in
2023
38
Annual Report 2023 In brief
Corporate governance
Sustainability statementBusiness and strategy Results Governance Financial statements
Board diversity
1
The Board seeks to be diverse in the broadest
sense relevant. When deciding whether to
propose re-election or not of board members
as well as when searching for candidates to
propose as new board members, the decision
is based on filling out any competence gaps
or strenghtening specific competences in the
Board. This is based on the collective compe-
tences that the Board finds relevant at the
time. The Board also recognises the benefits
of diversity in terms of cultural background,
gender, age etc.
Board diversity by the end of 2023
Nationality & residence
2
Brazil (1) / Denmark (1) / Germany (3) / Sweden (1) / Switzer-
land (1) / United Kingdom (3)
Board tenure (years)
1-5 (3) / 6-10 (2) / 11-15 (2)
Board independence rate
86% (2022: 83%)
Age distribution (years)
55-59 (2) / 60-64 (3) / 65-69 (2)
Gender
Female (2) / Male (5)
Educational backgrounds
Business Administration, Controlling and Auditing / Mechan-
ical Engineering / Economics / Strategy and Management /
Financial and Management Accounting / Human Resource
Management
The current Board competence profile is:
Individual competences:
• International and business-minded
• Analytical and strategic
• High integrity and accountability
• Team-oriented
Collective board competences:
• International top management
• Production & sales in building industry
within H+H's markets
• Strategy development
• M&A, divestments etc.
• Change management
• Production and H&S
• Supply chain management
• Sustainability / ESG
• HR management and compliance
• Finance and accounting
• ERM
• IT, AI and cyber security management
• IR and capital markets
• Corporate governance
H+H has since the annual general meeting on
31 March 2022 had equal gender distribution
in our Board of Directors, as defined by the
Danish Business Authority. For this reason,
no formal gender target under the law is set.
However, when the Board as part of its annual
1 See page 70 for more information on diversity in the Board and the two management levels below the Board | 2 Two board members have dual citizenship
board evaluation decides to want to change
its composition, the possibility to improve
especially the Board’s gender diversity and
age profile will naturally be pursued. Hence, If
two candidates for a board position are equally
competent, the person improving the gender
and/or age diversity will be preferred.
Board evaluation
The Board of Directors’ annual evaluation
procedure for 2023 was conducted following
the usual procedure of one-on-one meetings
based on a current questionnaire were held
between the Chair and each board member as
well as each executive board member.
The Board then held a board meeting without
the presence of the Executive Board to discuss
the findings and agree on conclusions and
action points. The issues evaluated included
e.g.:
• the board composition (diversity gaps in
regard to competences, gender, age, board
continuity etc. and the size of the Board)
• the board structure (review of the estab-
lishment in 2023 of a chairship with a Chair
and Vice Chair and the board committee
structure)
• the board performance (collective and indi-
vidual performance)
• co- operation between the Board and the
Executive Board (collective and individual
performance, co-operation inside and
outside of board and board committee
meetings).
The Board found their work to be based on
a high level of trust and collaboration. Board
members were all well prepared and had a
high participation rate. Together this indi-
cates that there was no issue of overboarding
for any member. The Board found the newly
established Chairship in 2023 to be an effec-
tive way to manage the Board, especially
during a challenging year with many and often
complex issues for the Board. The Board also
found there to be good and relevant diversity
in respect of competences and the spread in
board tenure, ensuring both continuity and
renewal. The co-operation between the Board
and the Executive Board functioned well and
the Executive Board said it benefitted from
having board members that collectively repre-
sented very diverse and relevant competences
with regard to special subject matters, indus-
tries, country market experience, and cultural
insights.
39
Annual Report 2023 In brief
Corporate governance
Sustainability statementBusiness and strategy Results Governance Financial statements
Based on this and also taking the need for
continuity during the current time of change
management and supervision of the resil-
ience plan developed in response to the
sudden significant decline in market demand
in 2023 and continuing into 2024, the Board
decided not to make any changes to the
board composition. Therefore, the Board will
propose re-election of all board members at
the annual general meeting on 9 April 2024. As
for the board committee structure the Board
did not want a dedicated sustainability/ESG
committee, since the Board sees sustainability
to be a general issue influencing all parts of
the business and management. Sustainability
should therefore be integrated in all board
committees and the Board.
The Board usually uses an external board
facilitator for its annual board evaluation
meeting every three years. The findings from
the one-on-one meetings were quite clear in
respect of not wanting to change the compo-
sition of the Board for the time being to ensure
full continuity among all board competences
during the sudden and very significant market
downturn and the need for effective resiliance
and change management actions in response
thereto. The value of using an external facil-
itator would therefore be limited. The Board
thus decided to postpone the use of a facili-
tator until the board evaluation for 2024.
Remuneration
Remuneration of the Board of Directors and
the Executive Board is paid in line with the
H+H Remuneration Policy for the Board of
Directors and Executive Board adopted by the
general meeting. The Remuneration Policy will
be reviewed and presented for approval at the
annual general meeting for 2024. H+H reports
on remuneration in an annual Remuneration
Report presented to the shareholders at the
annual general meeting for an advisory vote.
The Remuneration Report for 2023 and the
present Remuneration Policy are available on
the group website.
Annual corporate governance statement
As a listed company on NASDAQ Copenhagen,
H+H International A/S reports annually on the
recommendations on corporate governance.
These are issued by the Committee on Corpo-
rate Governance together with a description
of the internal control and risk management
system relating to the financial reporting as
required under Section 107(b) of the Danish
Financial Statements Act. The reporting is
done in an annual Corporate Governance
Statement available on our group website, at
recommendations, except for recommenda-
tion 3.5.1 on using external assistance at least
every 3 years in the Board of Director's annual
board evaluation. The explanation for this devi-
ation is provided in the Corporate Governance
Statement for 2023 as well as in this chapter
on Governance.
Report on data ethics
The following makes up the data ethics report
required under Section 99(d) of the Danish
Financial Statements Act.
H+H’s Data Ethics Policy has as its overall
objective to encourage and motivate all our
employees to handle data with the utmost care
and respect and to follow our guiding principles
on data use and ethics. We are committed to
complying with all applicable personal data
protection laws. We run internal audit controls
to secure compliance with both information
security and data protection requirements,
and all employees developing, purchasing or
otherwise working with technology and data
science-based uses of data must be informed
about the data ethics principles. We do not
purchase, sell or broker data or otherwise
profit from separate data transfers from or
to third parties. We do not currently carry out
data processing using artificial intelligence,
such as machine learning, as a natural part of
our business.
Our Data Ethics Policy can be found on the
group website, at www.hplush.com/en/
40
Annual Report 2023 In brief
Corporate governance
Sustainability statementBusiness and strategy Results Governance Financial statements
GOV-1 – The role of the administrative, management and supervisory bodies
Board of Directors
Kent Arentoft, Chair Jens-Peter Saul, Vice Chair Stewart Antony Baseley
Male. Born 1962. Danish. Male. Born 1966. German/British. Male. Born 1958. British.
Chairman of DSVM Invest A/S and subsidiaries (Denmark). CEO of Ramboll Group A/S, Denmark Executive Chairman, Home Builders Federation and
Board member of four subsidiaries (UK).
Independent
Member and Chair since 2013
Chair of the Nomination Committee
Independent
Member and Vice Chair since 2023 .
Member of the Nomination Committee
Member of the Remuneration Committee.
Not independent (more than 12 years board tenure)
Member since 2010
Member of the Nomination Committee
H+H shareholding
Holds 60,000 H+H shares via a company he controls.
No changes made in 2023.
H+H shareholding
Holds 6,259 H+H shares
All shares purchased in 2023.
H+H shareholding
Holds 22,500 H+H shares
No changes made in 2023.
Areas of expertise
Broad organisation and management experience in international companies in the
building materials and contracting sector, particularly within strategy development and
M&A transactions.
Areas of expertise
Extensive international experience in particular within strategy development and execu-
tion to accelerate organic and acquisitional growth and to maximise investments, as well
as broad insights into sustainability and the green energy transition. Experience from
diverse industries such as infrastructure, energy, construction, investment, manufactur-
ing and trading.
Areas of expertise
Experience in the international housebuilding industry and the developer industry,
particularly in the UK, as well as international management experience.
Other management positions and directorships
Member of the Investment Committee of Solix Group AB (Sweden) and Chair of one
subsidiary (Denmark).
Other management positions and directorships
Member of the Board of Directors of Cubico Sustainable Investments Limited (UK).
Other management positions and directorships
Chairman of Fuerst Day Lawson Holdings Limited (UK) and Director of one subsidiary (UK)
Chairman of Highlander-Partners (Poland) and Director of Sferra Fine Linens UK Limited (UK)
Chairman of Troy Homes Limited (UK).
Patron of Children with Special Needs Foundation (UK)
41
Annual Report 2023 In brief
Board of Directors
Sustainability statementBusiness and strategy Results Governance Financial statements
GOV-1 – The role of the administrative, management and supervisory bodies
Volker Christmann Kajsa von Geijer Miguel Kohlmann
Male. Born 1957. German. Female. Born 1964. Swedish. Male. Born 1962. German/Brazilian.
Managing Director, Senior Vice President Insulation Central Europe, Member of Group
Management of ROCKWOOL A/S. Chairman of the Board of Directors of two companies
in the ROCKWOOL Group, managing director of five companies in the ROCKWOOL
Group and member of the Board of Directors of ROCKWOOL Foundation.
Professional board member and advisor. Professional board member and advisor.
Independent
Member since 2017
Member of the Audit Committee
Independent
Member since 2022
Member of the Audit Committee
Member of the Remuneration Committee
Independent
Member since 2018
Chair of the Remuneration Committee
Member of the Nomination Committee
H+H shareholding
Does not hold any H+H shares
No changes made in 2023.
H+H shareholding
Does not hold any H+H shares
No changes made in 2023
H+H shareholding
Does not hold any H+H shares
No changes made in 2023
Areas of expertise
Extensive experience within the building materials production sector of Central Europe,
particularly in Germany, as well as within financial auditing and controlling.
Areas of expertise
International experience within strategic and operational HR, sustainability, ESG and
general compliance.
Areas of expertise
Extensive management experience in global building materials production and other
global industries. Worked in controlling, sales, production, and general management.
Other management positions and directorships
Chairman of the Board of Directors of BuVEG
(Bundesverband energieeffiziente Gebäudehülle) (Germany).
Member of the Board of Directors of FIW
(Forschungsinstitut für Wärmtechnik) (Germany).
Other management positions and directorships
Member of the Advisory Committee of Solix Group AB (Sweden) and of one its subsid-
iaries.
Other management positions and directorships
Chairman of the Board of Directors of Archroma Holdings SARL (Luxembourg) and NMC
International S.A. (Luxembourg).
Member of the Advisory Board of Pfleiderer GmbH (Germany) and Paul Bauder GmBH
(Germany).
Board of Directors – continued
42
Annual Report 2023 In brief
Board of Directors
Sustainability statementBusiness and strategy Results Governance Financial statements
GOV-1 – The role of the administrative, management and supervisory bodies
Helen MacPhee
Female. Born 1962. British.
Senior Vice President of Finance, AstraZeneca plc (UK).
Independent
Member since 2019
Chair of the Audit Committee
H+H shareholding
Does not hold any H+H shares
No changes made in 2023
Areas of expertise
Extensive experience within strategic and operational finance. International
experience in change management, financial oversight and control, management
of large-scale ERP implementation projects, governance, and risk frameworks.
Other management positions and directorships
N/A
Board of Directors –
continued
Executive Board
Jörg Brinkmann Peter Klovgaard-Jørgensen
Male. Born 1979. German. Male. Born 1978. Danish.
CEO since 2022 CFO since 2019
H+H shareholding
Holds 14,000 shares
All shares were purchased in 2023
H+H shareholding
Holds 15,043 shares
7,081 of the shares were earned under an incentive programme that vested in 2023.
Background
2018-2022: Managing Director, Europe of James Hardie Europe, GmbH (Germany)
2014-2018: CEO of Fermacell, GmbH (Germany)
2011-2014: Sales Director of Fermacell, GmbH (Germany)
2005-2011: Head of Marketing at Xella Group, GmbH (Germany)
Background
2016-2019: CFO of ISS Denmark A/S (Denmark)
2014-2016: Head of Finance of ISS Denmark A/S (Denmark)
2010-2014: Treasury Vice President of ISS Group (Denmark)
Prior: Various positions in ISS Group and auditor of EY (Denmark)
Education
MSc (Business Administration)
PhD Economics
Education
MSc (Business Economics and Auditing)
Other management positions and directorships
N/A
Other management positions and directorships
N/A
43
Annual Report 2023 In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Board of Directors / Executive Board
Denmark - 64%
Poland - 14%
United Kingdom - 7%
United States - 5%
Other - 4%
France - 3%
Sweden - 3%
Shareholder information
H+H international A/S is listed on
the Nasdaq Copenhagen stock
exchange and is trading under the
ticker symbol HH.
Geographical distribution of shareholders
By the fiscal year's end, H+H held 162,049
treasury shares, representing 1% of its share
capital.
Composition of shareholders
On 31 December 2023, H+H had more than
5,500 registered shareholders. Major share-
holders owning more than 10% of the share
capital and votes were Solbet Sp. z o.o. Major
shareholders owning more than 5% of the
Share information
Exchange Nasdaq Copenhagen
ISIN code DK0015202451
Ticker symbol HH
No. of shares 16,500,000
Denomination DKK 10 per share
Share capital DKK 165,000,000
Voting rights One vote per share
share capital and votes were Arbejdsmarke-
dets Tillægspension and Nordea Investment
Management AB. The majority of the share
capital (64%) is held by Danish investors. Other
key markets are Poland, the United Kingdom,
and the United States, accounting for 14%, 7%
and 5% of the share capital, respectively. Other
shareholders account for 4% of the total share
capital.
Major shareholders
Solbet Sp. z o.o., Poland > 10%
Arbejdsmarkets Tillægspension, Denmark >5%
Nordea Funds Ltd., Finland >5%
shares repurchased. This programme was
aimed to adjust the company's capital struc-
ture. Following the annual general meeting
on 30 March 2023, the decision to cancel
1,000,000 treasury shares, reducing the share
capital by 10,000,000 shares was passed (as
detailed in announcement no. 532). After this
reduction, H+H's share capital consists of
16,500,000 shares each valued at DKK 10,
with uniform voting and dividend rights.
Share-price development
The H+H International A/S shares started the
year at a price of DKK 103.20 and closed the
year at a price of DKK 88.80, representing
a decrease of 14%. At the end of the year,
the total market value of H+H amounted to
DKK 1,465 million. By comparison, the OMX
Copenhagen Mid-Cap index increased by 3% in
2023 and the Danish KAXCAP index, an index
comprising all stocks trading on the Nasdaq
Copenhagen stock exchange, increased by 2%.
The highest traded price during 2023 was DKK
118 on 12 January and the lowest traded price
was DKK 65 on 12 September. On average,
27,222 shares were traded daily throughout
the year.
Share capital and treasury shares
On 3 March 2022, H+H launched a DKK 150
million share buy-back program, which was
completed by 3 January 2023 with 1,118,800
44
Annual Report 2023 In brief
Shareholder information
Sustainability statementBusiness and strategy Results Governance Financial statements
OMXC Mid-Cap Index (re-based)H+H International A/S
KAXCAP Index (re-based)
January February March April May June July August September October November December
60
90
120
150
Annual general meeting
The next annual general meeting (AGM) is
scheduled for 9 April 2024. Details on time
and location will be announced in the notice
convening the AGM as published through a
company announcement and on our group
website no earlier than five to three weeks
before the AGM. AGM documents will be acces-
sible on our group website once the notice
is published. Amendments to the Articles of
Association require the resolution is passed by
at least two-thirds of the votes cast as well as
of the share capital represented at the AGM.
Investor Relations
The purpose of our financial communications
and other investor relations activities is to
ensure that relevant, accurate and timely infor-
mation is made available to the stock market
to serve as a basis for regular trading and a fair
pricing of H+H shares.
To ensure that capital market participants,
including current and prospective investors,
are able to make well-informed investment
decisions, we seek a transparent and active
dialogue with all financial market participants,
including investors, sell-side analysts, journal-
ists and the general public via conference calls,
participation in investor meetings and equity
conferences and social media.
H+H is not normally available for dialogue about
financial matters in the three-week period leading
up to the publication of an interim financial
report or the annual report. Inquiries concerning
investor relations issues should be addressed
to the Head of Investor Relations and Treasury
via email to Shar[email protected]. More
relevant investor information is available on our
group website.
Capital allocation policy
Our free cash flow allocation priorities are
unchanged from previous years:
1. Repay of net interest-bearing debt in periods
when the financial gearing ratio is above the
long-term target range;
2023 relative share-price performance
2. Pursuit of value-adding investments in the
form of acquisitions or development of the
existing business; and
3. Distribution of capital to the shareholders by
means of share buy-backs and/or dividends.
For the time being, we expect to use the free
cash flow to repay debt to lower the gearing
to within the long-term target ratio of 1-2x net
interest-bearing debt to EBITDA before special
items.
Financial calendar 2024
5 March 2023 Annual Report
9 April Annual General Meeting
15 May Q1 Interim Report
14 August H1 Interim Report
20 November Q3 Interim Report
More information
Other relevant shareholder information,
including a list of the analysts covering H+H
can be found on the group’s investor rela-
tions website
45
Annual Report 2023 In brief
Shareholder information
Sustainability statementBusiness and strategy Results Governance Financial statements
1
2
3
5
4
6
High
Low High
Net impact after mitigation
Probability
1
2
3
4
5
6
Market
Production
Financial
IT
People
Climate
Risk management
H+H International A/S’ Board of Directors and Executive Board are responsible for the H+H
Group’s risk management. The risk management processes are evaluated on a continuous
basis to ensure appropriate focus and balance in the efforts of risk management, including
risk profile and awareness. A full description of the risk management structure can be found
in the Corporate Governance statement for 2023.
Risk position 2023
The risks outlined below are recurring risks from previous year,
though the balance and severity, and hence the efforts to miti-
gate these risks, have changed. The changes are mainly driven
by the severe decrease in the building activity combined with
geopolitical instability. These developments have impacted the
customer behaviour to be more hesitant and has decreased the
demand in the housing market and increased production risks
through rising input costs.
1
Market
Risk description and mitigating actions
Continuous geopolitical instability and the stagnating economy
within Europe have a significant effect on the housing market,
lowering customer demands. Though inflation has been stabi-
lised it is still considered relatively high, and high interest rates
and lower demand are expected to persist through 2024. In
the long term, the European housing market continues to offer
strong underlying growth opportunities driven by a structural
undersupply of housing, demographic growth and a need for
efficient building materials.
Competition continues to be a risk and potential excess produc-
tion capacity could lead to changes in competitors’ pricing
strategies, affecting the Group margins. We have shown ability
46
Annual Report 2023 In brief
Risk management
Sustainability statementBusiness and strategy Results Governance Financial statements
to address this by adapting to the rapidly declining market with
reduction of production capacity and restructuring of cost base.
In low demand markets, pricing is a key risk, which we are closely
monitoring and taking some comfort in firm pricing discipline
across our markets. Further to this, the risk of competitors
producing more climate-friendly substituting products exists,
leading to potential loss of market share. This risk is offset by the
H+H climate strategy as described in the Sustainability state-
ment.
H+H closely monitors economic, political and competition
developments in the market and continue to adapt our pricing
strategy to the current market situation.
Net risk assessment
Operating in the building sector, we are exposed to economic
fluctuations, which was also seen in 2023. However, risks have
been mitigated by a firm pricing discipline, reduction of produc-
tion capacity, cost saving programs and cash management
focus. In addition, the agile regional business model allows for
timely responses to the specific market dynamics.
2
Production
Risk description and mitigation actions
Building activities dropped significantly in 2023, resulting in
excess production capacity and inventory building in beginning
of 2023. This required lower production and negative impact on
overhead recovery. H+H executed the prepared resilience plans
to adjust capacity by closing down a number of plants, perma-
nently or temporarily, redirecting production to larger plants
resulting in stabilisation of stocks and cost savings.
Other key elements of production risk include inflationary
pressures, scarcity of raw materials and conversion of produc-
tion equipment to new environmentally friendly products. We
continue to absorb the price through continuous improvement
projects and/or pass them on to customers. Mitigating actions
have been taken to reduce and manage the cost base where
relevant but are continuously being evaluated and reassessed
due to the dynamic market conditions. The Group procurement
function has been strengthened in 2023, and supply agreements
have been made, where possible, to lower the risk of scarcity and
inflation.
During 2023, we have changed our hedging policies for energy to
adapt to current sales price dynamics and pass through energy
price fluctuations to our customers compared to prior year's.
Previously, energy hedges were made locking in volume and
price for up to 3 years depending on the region. Going forward
our hedging strategy has a shorter timeframe to reflect the sales
price dynamics in our markets.
The expectations above are based on the assumptions of
continuous availability of the relevant energy sources and raw
materials but not including potential effects of the geopolitical
disturbances or recessionary developments in any of our current
markets.
Net risk assessment
Considering the mitigation plans, we believe the risk is moderate
but acceptable. However, we are continuously focusing on taking
mitigating actions towards production and supply risks as part of
the daily business.
Risk management
1
Market, continued
47
Annual Report 2023 In brief
Risk management
Sustainability statementBusiness and strategy Results Governance Financial statements
3
Financial
A new committed credit facility provides sufficient funding,
including strategic growth and long-term maturities. The agree-
ment has a duration of 3 years. Our financing is subject to finan-
cial covenants, which have been fulfilled in 2023, with reasonable
headroom, hence mitigating the financial risk of the Group.
Remaining financial or treasury risks are considered low with the
current market situation.
4
IT
Our production processes have a low dependency on IT, however
business administration relies on IT. Short-term contingency
plans and recovery strategies are therefore in place to address
potential disruptions in the key systems.
Rising global cybercrime threats require continuous attention.
Mitigating actions are consistently updated and implemented,
reducing the likelihood of occurrence and potential impact,
though the threat remains.
5
People
The core risk of health and safety is imperative to H+H, and we
strive for zero harm to our people, contractors, suppliers, and
customers. The importance is embedded in our Health and
Safety Policy, which embraces a culture of safety and provides
guidance for applying our safety management system across
all our operations. Near-miss reporting, and root cause analysis
are carried out, and though mitigating the risk, H+H works to
continuously improve our performance together with external
and internal reviews.
In a declining market where restructuring and closing of plants
have been necessary, H+H has not only a social responsibility,
but a risk of knowledge loss. Restructuring has happened under
respect for the of International Labour Organization’s eight
fundamental conventions and in cooperation with local stake-
holders, continuous training of our employees, thus mitigating
our risk to an acceptable level.
6
Climate
The direct impact from expected climate changes, such as
floodings etc., in the near future, is considered limited for H+H.
Government and construction companies are increasingly
demanding sustainable products and a sustainable supply chain.
H+H has an environmental strategy that continues to focus on
enhancing the product portfolio through more sustainable prod-
ucts and application methods, to improve energy efficiency and
lower the life-cycle emissions of buildings.
We continue to focus on reduction of scope 1 and 2 emissions, in
order to achieve net-zero emissions from operations, zero harm
to our people and ethical business practices as part of our plans
on corporate social responsibility.
The overall strategy on climate, as described In the Sustainability
statement in this report, mitigates the risk to an acceptable level
from a risk management perspective. An execution risk for the
long-term strategy remains, as it relies on the use of hydrogen
which is not yet available on the market. Further, risk in the
supply chain exists as we rely on suppliers of cement, lime and
transport services to reach their direct emissions targets for
H+H to reach the desired impact.
Risk management
48
Annual Report 2023 In brief
Risk management
Sustainability statementBusiness and strategy Results Governance Financial statements
Sustainability
statement
50 General information
57 Environmental information
67 Social information
74 Governance information
77 Summary of metrics and
appendix
78 Accounting policy
In our labs, we work on
optimising the recipes for our
products to save raw materials
and increase energy efficiency.
49
Annual Report 2023 In brief Sustainability statementBusiness and strategy Results Governance Financial statements
50
Annual Report 2023 In brief
General information
Sustainability statementBusiness and strategy Results Governance Financial statements
51
Annual Report 2023 In brief
General information
Sustainability statementBusiness and strategy Results Governance Financial statements
52
Annual Report 2023 In brief
General information
Sustainability statementBusiness and strategy Results Governance Financial statements
53
Annual Report 2023 In brief
General information
Sustainability statementBusiness and strategy Results Governance Financial statements
Impact material
Non-material
Double material
Financial material
Financial impact on H+H
H+H impact on people and environment
1 2 314
20
15
21
16
22
17
24
4 9
18
5 10
19
6
11 23
7
12
8
13 0
Environmental
E1 Climate
1
Climate change adaptation (CCA)
2
Climate change mitigation (CCM)
3
Energy
E2 Pollution
4
Air
5
Water
6
Soil
0
Living organisms
0
Substance of (high) concern
E3 Water & marine resources
7
Water withdrawals
0
Marine resources
0
Water habitat degradation
E4 Biodiversity & ecosystems
8
Direct impact drivers on biodiversity loss
0
Impact on the state of species
9
Impacts on the extent and condition
of ecosystems
10
Impacts and dependencies on ecosystem
services
E5 Resource use and circular economy
11
Resource inflows and usage
12
Resource outflows related to products
and services
13
Waste
Social
S1 Own workforce
14
Working conditions
15
H&S
16
Equal treatment and opportunities
17
Talent development
0
Other work related rights
S2 Workers in the value chain
18
Working conditions
19
Equal treatment and opportunities
0
Other work related rights
S3 Affected communities
0
Economic, social and cultural rights
0
Civil and political rights
0
Particular rights of indigenous rights
S4 Consumer & end-user
0
Information related impacts
0
Personal safety of consumers
0
Social inclusion of consumers
Governance
G1 Business conduct
20
Corporate culture
21
Whistleblower protection
0
Animal welfare
22
Political & lobbying activities
23
Payment practices with suppliers
(late payment)
24
Corruption and bribery
Reporting topics in scope
Topics marked '0' in the list to the right were deemed immaterial from the start and thereby not
included in the engagement process.
54
Annual Report 2023 In brief
General information
Sustainability statementBusiness and strategy Results Governance Financial statements
55
Annual Report 2023 In brief
General information
Sustainability statementBusiness and strategy Results Governance Financial statements
56
Annual Report 2023 In brief
General information
Sustainability statementBusiness and strategy Results Governance Financial statements
57
Annual Report 2023 In brief
Environmental information
Sustainability statementBusiness and strategy Results Governance Financial statements
H+H’s total CO
2
e 2019 emissions used
as a baseline for science-based targets
Energy
75%
Gas, coal, oil
Operational
equipment
and offices
25%
Electricity, steam
75%
Value-chain emissions
(Scope 3)
Raw materials
95%
Lime, cement
Distributions
and embedded
energy emissions
5%
Diesel
25%
Emissions from operations
(Scope 1+2)
58
Annual Report 2023 In brief
Environmental information
Sustainability statementBusiness and strategy Results Governance Financial statements
59
Annual Report 2023 In brief
Environmental information
Sustainability statementBusiness and strategy Results Governance Financial statements
100%
10% -17%
-4%
-35%
54%
2019 baseline
emissions
Organic growth and
improvements, net
(2019-2030)
Increase share of
renewable electricity
(2022-2025)
Investments in
energy eciency
(2020-2030)
Improved
energy mix
(2022-2030)
2030
emissions
0
20
40
60
80
100
120
H+H's roadmap to reduce emissions for scope 1+2 in line with its science-based target
60
Annual Report 2023 In brief
Environmental information
Sustainability statementBusiness and strategy Results Governance Financial statements
21%
4%
61%
5%
65k
MWh
33k
MWh
146k
MWh
26k
MWh
418k
MWh
9%
19%
3%
64%
6%
8%
24k
MWh
32k
MWh
81k
MWh
12k
MWh
272k
MWh
Natural gasCoal
Fossil steam
and electricity
Oil Renewable
electricity
2023 2022
Breakdown of energy comsumption (MWh)
61
Annual Report 2023 In brief
Environmental information
Sustainability statementBusiness and strategy Results Governance Financial statements
eq) 758.327 688.192 442,582 -36%
per m
2,0%
9 E1-7 – GHG removals and GHG mitigation projects financed through carbon credits | 10 E1-8 – Internal carbon pricing |
11 E1-9 – Anticipated financial effects from material physical and transition risks and potential climate-related opportunities
62
Annual Report 2023 In brief
Environmental information
Sustainability statementBusiness and strategy Results Governance Financial statements
EU Taxonomy
The manufacture of concrete
products for construction
purposes (NACE C23.6.1), which
is where H+H’s AAC and CSU
products are classified, is not yet
included in the Taxonomy as a
separate economic activity.
Hence, our activities are not eligible, and
revenue derived from products or services
eligible is 0.
The EU Taxonomy is still under development
and due to the evolving aspect of the Regula-
tion, we expect that reporting will change and
develop over the coming years. Therefore, we
will reassess the reporting requirement on an
annual basis.
Taxonomy activities
We have assessed the activities by screening
the activities listed in the Climate Delegated
Act 2021/2139, the Complementary Climate
Delegated Act 2022/1214, the Environ-
mental Delegated Act 2023/2486, and the
amendments to the Climate Delegated Act
2023/2485.
Revenue
During our screening, we identified no eligible
revenues. Revenue is defined as revenue
included in the consolidated financial state-
ments for the year 2023.
CAPEX
During our screening, we identified 9% eligible
capital expenditures. The Taxonomy-eligible
CAPEX primarily includes activities related
to transport (6.5+6.6). CAPEX is defined as
additions of tangible assets and intangible
assets (excluding goodwill) as included in the
consolidated financial statements for the year
2023, note 13 & 14.
OPEX
During our screening, we identified no eligible
operational expenditures, mainly due to our
non- eligible revenue activities. Operating
expenditures as per the EU Taxonomy are
defined as directly incurred, non-capitalizable
cost relating to research and development,
building renovations, short-term leases, and
the repair and maintenance of property, plant,
and equipment in 2023.
Other disclosures
There is no CAPEX double counting in the
numerator across economic activities, as we
have assessed each material CAPEX individually.
No KPIs have been disaggregated in the
reporting.
EU Taxonomy Disclosure
2023 Revenue Capex OPEX
Taxonomy-eligible activities 0% 9% 0%
Taxonomy-non-eligible activities 100% 91% 100%
Taxonomy-aligned acitvities N /A 0% N/A
Taxonomy-non-aligned acitvities N/A 100% N/A
* The Taxonomy Technical Report (June 2019, p191- 192) states that concrete products are not included because the cement content
and total GHG emissions can vary significantly based on the specifications of the application that the concrete will be used for. For this
reason, the manufacture of concrete (NACE C.23.6) and concrete products are not covered by the Taxonomy.
63
Annual Report 2023 In brief
Environmental information
Sustainability statementBusiness and strategy Results Governance Financial statements
Financial year 2023 2023 Sustainable contribution criteria DNSH criteria ("Does Not Significant Harm")
Economic activities - Turnover (1)
Code (2)
Absolute turnover
(m DKK) (3)
Proportion of
turnover 2023 (%) (4)
Climate Change
Mitigation (5)
Climate Change
Adaptation (6)
Water (7)
Pollution (8)
Circular economy (9)
Biodiversity (10)
Climate Change
Mitigation (11)
Climate Change
Adaptation (12)
Water (13)
Pollution (14)
Circular economy (15)
Biodiversity (16)
Minimum
Safeguards (17)
Taxonomy aligned (A.1.)
or eligble (A.2.) turn-
over, 2022 (%) (18)
Category
(enabling activity) (19)
Category
(transitional activity)
(20)
A. Taxonomy – Eligible Activities
A1. Environmentally sustainable acitivities
(Taxonomy-aligned)
Turnover of environmentally sustainable activities
(Taxonomy-aligned) 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0%
Of which Enabling 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0% E
Of which Transitional 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0% T
A2. Taxonomy-eligible but not aligned activities
Turnover of not-aligned activities 0 0% 0%
Turnover of taxonomy-eligible activities (A1+A2) 0 0% 0%
A. Taxonomy – Non-Eligible Activities
B. Turnover of non-eligible activities 2,672 100%
Total 2,672 100%
H+H does not have any eligible acitivities, hence no turnover is allocated to the numerator.
EU Taxonomy – Turnover
64
Annual Report 2023 In brief
Environmental information
Sustainability statementBusiness and strategy Results Governance Financial statements
Financial year 2023 2023 Sustainable contribution criteria DNSH criteria ("Does Not Significant Harm")
Economic activities - CAPEX (1)
Code (2)
Absolute CAPEX
(m DKK) (3)
Proportion of
CAPEX 2023 (%) (4)
Climate Change
Mitigation (5)
Climate Change
Adaptation (6)
Water (7)
Pollution (8)
Circular economy (9)
Biodiversity (10)
Climate Change
Mitigation (11)
Climate Change
Adaptation (12)
Water (13)
Pollution (14)
Circular economy (15)
Biodiversity (16)
Minimum
Safeguards (17)
Taxonomy aligned (A.1.)
or eligble (A.2.) CAPEX,
2022 (%) (18)
Category
(enabling activity) (19)
Category
(transitional activity)
(20)
A. Taxonomy – Eligible Activities
A1. Environmentally sustainable acitivities
(Taxonomy-aligned)
CAPEX of aligned activities 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0%
Of which Enabling 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0% E
Of which Transitional 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0% T
A2. Taxonomy-eligible but not aligned activities
Construction, extension and operation of water collection,
treatment and supply systems CCM 5.1 - 0% 1%
Transport by motorbikes, passenger cars and light com-
mercial vehicles CCM 6.5 4 2% 2%
Freight transport services by road CCM 6.6 15 7% 7%
Construction of new buildings CCM 7.1 - 0% 1%
CAPEX of non-aligned activities 19 9% 10%
Total (A1+A2) 19 9% 10%
A. Taxonomy – Non-Eligible Activities
CAPEX of non-eligible activities (B) 182 91%
Total (A+B) 201 100%
Primary source of CAPEX contributing to the numerator is lease of forklift trucks and passenger cars (DKK 15 and 4 mil respectively) . Please refer to the annual report 2023 (note 13 & 14) for more information about additions.
No formal CAPEX-plan in relation to EU-taxonomy has been developed in 2023, but will be reassessed in 2024.
EU Taxonomy – CAPEX
65
Annual Report 2023 In brief
Environmental information
Sustainability statementBusiness and strategy Results Governance Financial statements
Financial year 2023 2023 Sustainable contribution criteria DNSH criteria ("Does Not Significant Harm")
Economic activities - OPEX (1)
Code (2)
Absolute OPEX
(m DKK) (3)
Proportion of
OPEX 2023 (%) (4)
Climate Change
Mitigation (5)
Climate Change
Adaptation (6)
Water (7)
Pollution (8)
Circular economy (9)
Biodiversity (10)
Climate Change
Mitigation (11)
Climate Change
Adaptation (12)
Water (13)
Pollution (14)
Circular economy (15)
Biodiversity (16)
Minimum
Safeguards (17)
Taxonomy aligned (A.1.)
or eligble (A.2.) OPEX,
2022 (%) (18)
Category
(enabling activity) (19)
Category
(transitional activity)
(20)
A. Taxonomy – ligible Activities
A1. Environmentally sustainable acitivities
(Taxonomy-aligned)
OpEx of environmentally sustainable activities
(Taxonomy-aligned) 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0%
Of which Enabling 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0% E
Of which Transitional 0 0% N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A 0% T
A2. Taxonomy-eligible but not aligned activities
OpEx of non-aligned activities 0 0% 0%
Total (A1+A2) 0 0% 0%
A. Taxonomy – Non-Eligible Activities
OpEx of non-eligible activities (B) 138 100%
Total (A+B) 138 100%
H+H does not have any eligible OPEX, hence no OPEX is allocated to the numerator.
EU Taxonomy – OPEX
66
Annual Report 2023 In brief
Environmental information
Sustainability statementBusiness and strategy Results Governance Financial statements
List of material disclosure requirements Page reference
S1- Own workforce
SBM-3 Material impacts, risks and opportunities and their interaction with strategy and
business model
Pages 67, 69, 72
S1-1 Policies related to own workforce Pages 68-69, 72
S1-2 Processes for engaging with own workforce and workers' representatives Page 72
S1-3 Processes to remediate negative impacts and channels for own workforce Page 72
S1-4 Taking action on material impacts on own workforce, and approaches to manag-
ing risks and pursuing opportunities related to own workforce, and effectiveness
of those actions
Page 68, 70, 72
S1-5 Targets related to managing material negative impacts, advancing positive
impacts, and managing material risks and opportunities
Pages 71-72
S1-6 Characteristics of the undertaking’s employees Page 73
S1-8 Collective bargaining coverage and social dialogue Page 72
S1-9 Diversity metrics Page 70-71
S1-13 Training and skills development metrics Page 72
S1-14 Health & Safety metrics Page 68
S1-15 Work-life balance metrics Page 73
S1-16 Remuneration metrics (pay gap and total remuneration) Page 71
S1-17 Incidents, complaints and severe human rights impacts Page 71
Social information
People are the heart of H+H. Managing our social impacts
is integral to our ambition to create a safe, appealing, and
meaningful workplace for our employees. In this section,
we take a thematic approach to the sustainability topics
identified in our materiality assessment.
• Silicate, which is a carcinogen
• Mineral oils that can cause dermatitis.
• Aluminium dust which is an irritant but does
not cause chronic effects.
Both impacts affect employees working in our
plants in our own operations and occur over
the short, medium and long-term. No material
risks or opportunities related to health & safety
were identified in the materiality assessment.
Impacts, risks and opportunities
management
To effectively manage our risks and impacts
and to maintain a strong safety performance,
we have a Group Health & Safety Policy, a
strategy for 2023-2026 and a health and
safety management system. In practice, we
prevent safety incidents through continuous
and regular assessment of plants, offices,
processes, and equipment; incident manage-
ment as well as target setting, progress meas-
urement and regular training in Health & Safety
across the Group.
Our ambition is to reduce short-term absen-
teeism to 8 days per year by 2024 (excluding
absenteeism from long-term illness) and to
reduce our lost-time incidents frequency (LTIF)
to 3.5 by 2024. To highlight its importance, the
Health and Safety
Impacts, risks & opportunities
1
The building materials industry has inherent
health and safety risks from the heavy equip-
ment and harmful substances used in the
production process. Managing these risks
effectively and maintaining a strong safety
performance underpins our operations and
enables us to provide healthy, safe, and secure
working conditions for employees and contrac-
tors.
Material health & safety impacts
In the materiality assessment, we identified the
following material health & safety impacts:
Industrial accidents
The majority of our employees work in our
plants where they operate heavy machinery
with a risk of accidents which can result in the
direct impact of major and life-altering injuries
or death.
Harmful substances
Employees working in our plants may also be
exposed to the following harmful substances
used in production that pose health risks:
1 ESRS 2 SBM-3
67
Annual Report 2023 In brief
Social information
Sustainability statementBusiness and strategy Results Governance Financial statements
short-term incentive plan for 2023 included
one target relating to lost-time incidents.
Health & Safety Policy
2
Providing a safe and healthy work environment
is our key priority and safety is non-negotiable.
This is the core objective of our Group H&S
Policy, and it is the foundation on which we
prevent, mitigate, and remediate all of H+H’s
impacts and risks related to H&S.
The COO has overall responsibility for the
policy, while the regional managing directors
are responsible for implementing it within their
countries as heads of their respective legal
entities. They are supported by the regional
Operations Directors, local safety officers and
the Group Health & Safety leadership team.
The policy is distributed via our policy manage-
ment system and is available on notice boards
at all sites and on the group website. All
employees are required to confirm, either
physically or digitally, that they have read and
understood the policy. The policy covers H+H
employees across the entire workforce but
does not include workers in the value chain.
The H&S Policy is reviewed annually by Group
Management and the Group H&S Manager.
This review is based on a self-assessment
audit process, and on input provided by the
functional management teams and their
employees.
Actions in 2023
3
With the conclusion of the 2020-2023 Strategy
and Vision for H&S, a new strategy and vision
for 2024-2026 was developed and approved.
The new strategy focuses on behavioural
safety and on embedding a culture of safety
across our operations, moving towards our
ambition of Zero Harm.
In support of the strategy and vision for 2024-
2026 and to mitigate our risks and impacts,
we have launched three global H&A awareness
campaigns, updated and developed various
training programmes and work standards, and
simplified and improved our internal reporting.
Performance, metrics and targets
4
For the ninth consecutive year, there were no
fatalities at H+H. We recorded a lost-time inci-
dents frequency of 3.4, which is an improve-
ment from last year’s record result of 3.6. This
is an incredible result given the difficult year
in the construction industry with layoffs and
consequently changes in work procedures
and shift systems – all of which can increase
the risk of workplace incidents. We therefore
remain confident in our ability to reach our
5-year target of an LTIF 3.5 in 2024.
While the number of incidents declined, the
number of lost days increased due to some of
the incidents being more severe and requiring
2023 2022 2021
Sickness absence Days per FTE 14 13 12
Sickness Absence, short-term Days per FTE 10 11 10
Fatalities Headcount 0 0 0
Lost-time incident frequency (LTIF) Incidents per
mil. hours *3.4 3.6 5.5
Lost days to work-related injuries and fatalities from work-related
accidents, work-related ill health and fatalities from ill health
787 313 263
Total recordable incidents 18 77 103
Total recordable incident rate (TRIR) Incidents per
mil. hours 7 25 35
Number of cases of recordable work-related ill health 0 - -
People in own workforce covered by H+H’s H&S Management system % 100% - -
* ESG figure subject to limited assurance
2 S1-1 – Policies related to own workforce | 3 S1-4 – Taking action on material impacts on own workforce |
4 S1-14 – Health and safety metrics
more time off. In addition, one incident from
end of 2022 had a material impact on the
increase as lost days from this continued into
most of 2023.
Sickness absence remained stable but at a
high level. We expect to improve this in 2024.
68
Annual Report 2023 In brief
Social information
Sustainability statementBusiness and strategy Results Governance Financial statements
Equal treatment &
opportunities for all
Impacts, risks & opportunities
1
We want all employees and stakeholders to feel
that their contribution is valid, and we do not
tolerate any form of discrimination. We know
people are different and we believe that differ-
ences are what enable us to be innovative, see
new opportunities and create better solutions.
Material impacts
In the materiality assessment, we identified
the following material impacts related to equal
treatment and opportunities:
Gender equality & equal pay
for work of equal value
We are committed to equal pay for equal work,
promoting gender equality and ensuring equal
access to resources and opportunities regard-
less of gender. This has a positive impact on
our workforce by improving employee cohe-
sion and well-being
69
Annual Report 2023 In brief
Social information
Sustainability statementBusiness and strategy Results Governance Financial statements
5 S1-4 – Taking action on material impacts on own workforce | 6 S1-9 Diversity metrics | 7 Danish Financial Statements Act section 99(b) | 8 Danish Companies Act Section 139(c)
70
Annual Report 2023 In brief
Social information
Sustainability statementBusiness and strategy Results Governance Financial statements
71
Annual Report 2023 In brief
Social information
Sustainability statementBusiness and strategy Results Governance Financial statements
Training & skills
development and
working conditions
Impacts, risks & opportunities
1
H+H seeks to be an employer of choice and to
provide a safe and attractive work environment
for our employees during all stages of their
career. We want to attract and retain qualified
and motivated employees who can support
our business ambitions. To enable this, we
offer our people training and development to
enhance their skills and develop their careers
while also providing opportunities to shape
their work whenever possible.
The following material impacts related to
training and skills development and working
conditions were identified in the materiality
assessment:
Training and skills development
By providing attractive training and develop-
ment opportunities that help our employees
realise their potential and ambitions, we have a
positive impact on our workforce. This impact
occurs in our own operations over the short,
medium, and long-term periods.
Work-life balance during the downturn
in the construction sector
Plant closures and redundancies that have
occurred as a result of the current downturn
in the construction sector has led to changes
in working hours and shift patterns, which
may have a negative impact on employee
work-life balance. This potential impact affects
employees in our plants in our own operations
and occurs over the short and medium-term.
No material risks or opportunities were iden-
tified.
Impacts, risks, and opportunities
management
Managing our impacts is key to ensuring that
we have the workforce we need to achieve our
business ambitions. Performance, skill, and
talent management is handled locally where
managers are encouraged to keep an open
dialogue with employees and to continually
assess the need for training.
Policies related to training & skills
development and working conditions
2
H+H does not have a policy that specifically
addresses training and skills development.
In addition to required upskilling or renewal
of certificates, we believe that performance,
talent, and competence management should
be managed in regular dialogues between
managers and employees, instead of being
dictated by policy.
Working conditions and work-life balance for
our employees are mainly governed by local
policies and employee handbooks. The ability
to take leave differs from region to region and
is in line with local legislation. The opportu-
nity to work flexibly also varies from region to
region and depends on the nature of the job.
Employees are encouraged to provide feed-
back and voice any concerns to ensure that
they feel they have sufficient time for both
work and their private life.
Actions
3, 4, 5
In order to create an attractive working envi-
ronment, we regularly engage in dialogue with
our employees to understand their perspec-
tives and needs. This includes employee
surveys for selected employees, manager 1:1’s,
as well as local and global Q&A sessions with
management.
H+H also operates a whistleblower system
which was updated in 2023 and is described in
the Governance information section.
All employees can raise their concerns directly
to a manager or through our whistleblower
system. It varies from country to country and
depending on local legislation, whether or not
employees are represented by a local organisa-
tion such as a workers’ council or work environ-
ment organisation.
Performance, metrics and targets
6
Currently, we do not have complete data on the
number of training hours per employee or how
many of our employees have participated in
performance and career development reviews.
We aim to collate this data in the future.
Social dialogue
7, 8
Coverage
Rate
Employees
– Non-EEA
Workplace
representation
(EEA only)
0-19% Poland
20-39% UK
40-59%
60-79% Germany
80-100%
For countries with >50 employees representing >10% total
employees)
H+H’s operations are all located in Europe in
countries with legally set minimum adequate
wages. During the process of annual salary
review we ensure that we are in line with local
legal requirements and with peer and similar
companies through regional benchmark
analysis
9
.
1 ESRS 2 SBM-3-S1 Material impacts, risks and opportunities and their interaction with strategy and business model | 2 S1-1 – Policies related to own workforce | 3 S1-4 – Taking action on material impacts on own workforce | 4 S1-2 Processes for engaging with own workforce
and workers’ representatives about impacts | 5 S1-3 Processes to remediate negative impacts and channels for own workforce to raise concerns | 6 S1-13 Training and Skills Development Metrics | 7 S1-8 Collective bargaining coverage and social dialogue (paragraph 60)
72
Annual Report 2023 In brief
Social information
Sustainability statementBusiness and strategy Results Governance Financial statements
82%
18%
238
1,117
39%
40%
14%
7%
189
99
540
527
95%
5%
49
882
55%
45%
190
234
Female
Female Female
Germany
United Kingdom
Male
Male Male
Poland
Other
All employees are entitled to take family-re-
lated leave, but unfortunately, we do not have
the total number of employees who have
chosen to do so during 2023
10
.
Characteristics of H+H employees
11
The gender ratio of our workforce remains
stable with an even split among workers in
office environments and low diversity among
workers in our plants and other non-office
environments.
Headcount by gender Headcount by country
*
Headcount by gender – Non-Office Headcount by gender – Office
* While H+H is also present in Czech Republic, Denmark, Netherlands, Sweden and Switzerland, these are not
included due to being less than 50 employees/ less than 10% of the workforce
8 (page72) S1-15 Work-life balance metrics | 9 (page 72) S-10 Adequate wages, paragraph 67-69 | 10 S1-15 Work -life balance metrics |
11 S1-6 – Characteristics of the undertaking’s employee | 12 Voluntary turnover ratio was 13%
Headcount by contract type and gender
Contract type Female Male Total
Number of employees 238 1.117 1.355
Number of permanent employees 238 1,117 1.355
Number of temporary employees 0 0 0
Number of non-guaranteed hours employees 0 0 0
As we have experienced a market downturn,
we have prioritised our permanent employees
and therefore reduced and out-phased our use
of temporary workers.
Turnover
Unit 2023 2022 2021
Employee turnover ratio
12
% 40% 15% 13%
Employee turnover Headcount 605 267 206
As the downturn in the construction industry
has led to plant closures and restructuring
across the H+H group, our turnover rate has
greatly increased compared to previous years.
Adjusted for this, our turnover rate remains
on par with previous years and in line with the
turnover rate among peer companies.
73
Annual Report 2023 In brief
Social information
Sustainability statementBusiness and strategy Results Governance Financial statements
Governance
information
List of material disclosure requirements Page reference
G1 - Business Conduct
G1-1 Business conduct policies and corporate culture Page 74
G1-3 Prevention and detection of corruption and bribery Page 75
G1-4 Incidents of corruption or bribery Page 76
H+H is committed to acting professionally, responsibly, and
with integrity in all our business dealings and relationships.
With consideration for the needs of all stakeholders, including
customers, employees, shareholders, and suppliers, and with
stakeholders feeling valued.
1 G1-1 Business conduct policies and corporate culture
Impacts, risks and opportunities
The construction industry faces risks asso-
ciated with bribery, corruption and anti-com-
petitive practices due to the large number of
contractors, suppliers and other entities in
the value chain and the competitive bidding
process to secure private and public contracts.
We consider the overall risk of corrupt behav-
iour to be relatively low. We sell mainly through
builders’ merchants (wholesalers) and have
limited direct involvement in negotiations and
bid proposals. In addition, we only operate in
Europe within countries that have low risks
of bribery and corruption, ranking between 1
(Denmark) and 45 (Poland) out of 180 in the
Transparency International Corruption Percep-
tions Index 2023 .
The following risk related to business conduct
was identified in the materiality assessment:
Unethical business practices
The main risk of corrupt behaviour for H+H
concerns inappropriate types or levels of
entertainment and gifts provided to our
employees from potential or actual suppliers
or provided by our employees to potential or
actual customers with the intent of gaining
special consideration or a business advantage.
This risk occurs in our own operations over the
short, medium and long term.
Impacts, risks and opportunities
management
We manage this risk by continually working
to strengthen our compliance culture. This
is done through our policies, whistleblower
system, training and awareness, by conducting
audits, and through leadership communication
and behaviour that sets the tone from the
top on conducting business with integrity.
Business conduct policies
and corporate culture
1
Code of Conduct and Code of
Conduct for Suppliers
H+H’s Code of Conduct is the foundation of our
compliance programme and sets the tone for
business integrity and our ethical principles.
It is complemented by the Code of Conduct
for Suppliers which outlines our expectations
to suppliers to conduct business in a legal,
sustainable, ethical and socially responsible
manner.
The Code of Conduct and Code of Conduct for
Suppliers include our principles related to e.g.
environment and climate, health and safety,
diversity, non-discrimination, personal data
protection, conflicts of interest, fair competi-
tion, anti-corruption, responsible tax and data
ethics.
The CEO is responsible for the Code of
Conduct and the COO is responsible for the
74
Annual Report 2023 In brief
Governance information
Sustainability statementBusiness and strategy Results Governance Financial statements
Code of Conduct for Suppliers. Both of these
policies are reviewed regularly and updated
in line with relevant legislation, and they are
available at all H+H websites.
Employees can access these policies in H+H’s
policy management system via the Group
intranet. Employees without direct access to
the intranet are provided with either paper
copies or access via shared computers or
notice boards. Every employee at H+H is
required to read and adhere to the H+H Code
of Conduct.
Ultimately, the Board of Directors is respon-
sible for oversight of H+H’s corporate culture
and business conduct. The Executive Board
and other managers in the Group are respon-
sible for leading by example and driving a
culture of business integrity and encourage
colleagues to discuss openly how to follow
the principles in the Code of Conduct and the
underlying specific policies. Also, to support
our commitment to responsible business
conduct, the Regional Managing Directors are
required to sign a declaration every quarter
that to the best of their knowledge, all H+H
entities in their region are conducting business
in a way that is compliant with all applicable
H+H policies.
We expect suppliers to share our commitment
to conducting business in a legal, sustainable,
ethical, and socially responsible manner.
We communicate the Code of Conduct for
Suppliers to all major suppliers and request
them to confirm and agree with the content.
H+H will not enter into agreement with major
suppliers who will not commit or cannot
demonstrate that they meet the requirements
in our Code of Conduct for Suppliers or show
compliance with relevant laws.
Whistleblower policy & system
Employees, business partners and other
stakeholders are encouraged to speak up and
report any suspected wrongdoing to a relevant
H+H manager.
However, if circumstances are such that the
whistleblower prefers to report in confidence,
they can do so anonymously via H+H’s public
online whistleblower system. The system
is accessible in all our languages and can
be accessed both from H+H’s intranet for
employees and from all H+H websites. Good
faith whistleblowers are protected from any
kind of retaliation or discriminatory or discipli-
nary action as a result of submitting a report.
2 G1-3 – Prevention and detection of corruption and bribery
The system is provided by an independent
third-party provider of whistleblower solutions
and reporters have the option of choosing if
they want to report to local HR, Group HR or
Group Legal.
All good faith reports of suspected violations
of the Code of Conduct or any underlying H+H
policies and violations of law are investigated.
We take great care to ensure the confidenti-
ality of the reporter’s identity and to avoid any
potential conflicts of interest when establishing
the investigation team and the lead decision
maker. Independent, external legal counsel is
also used for investigations.
H+H’s Whistleblower Policy is available in the
whistleblower system and provides informa-
tion on how to report suspected misconduct,
how reports are handled and what is deemed
inside and outside scope. The CEO is respon-
sible for the Whistleblower Policy.
The whistleblower system and policy were
both updated and relaunched in late 2023 and
awareness campaigns and training have been
scheduled throughout 2024.
Anti-corruption and bribery
2
H+H has zero tolerance for corruption and
bribery, and we condemn corrupt behaviour
and business practices. This is underpinned
by our Anti-corruption Policy which provides
principles and information related to bribery,
facilitation payments, donations, and enter-
tainment and gifts. The CEO is responsible for
the Anti-corruption Policy which is reviewed
regularly and updated in line with relevant
legislation.
The policy includes relevant sector specific
practical examples to raise awareness of
business situations that may involve bribery
or corruption and the behaviour expected of
H+H employees in such situations. In addition
to this, internal locally managed training is
provided to the functions deemed most at
risk. In H+H, these are procurement, sales &
marketing, and regional management.
Internal controls are set up to manage the
said corruption risks present on the sales and
procurement side. Escalation procedures are
in place and communicated within the Group.
75
Annual Report 2023 In brief
Governance information
Sustainability statementBusiness and strategy Results Governance Financial statements
Metrics and targets
3
Incidents of corruption and bribery
During 2023, no whistleblower reports were
found to be within scope. Also, H+H did not
receive any injunction, ruling, conviction, fine
or similar for violation of anti-corruption or
anti-bribery laws.
Political influence and lobbying activities
4
H+H has not made and does not make any
financial or in-kind contributions directly to
political parties, their elected representatives
or persons seeking political office.
H+H is a member of the European Autoclaved
Aerated Concrete Association and the Euro-
pean Calcium Silicate Product Association
and holds memberships in national business
associations. The total annual contribution for
these memberships is 5 million DKK.
No members of the Board of Directors or
Group management have held roles in public
administration or regulatory bodies in the two
years prior to the 2023 reporting period.
Tax Policy
H+H has adopted a group Tax Policy. The policy
is the foundation for the common tax approach
for the H+H Group. Our ambition is to always
apply best practices and act in accordance
with applicable legislation on tax computation
and tax reporting to ensure that we pay the
right amount of tax at the right time in the
countries where we operate. In close collabora-
tion with tax advisors, we monitor updates and
changes to tax legislation to assess the impact
on a Group and country level.
3 G1-4 – Incidents of corruption or bribery | 4 G1-5 – Political influence and lobbying activities
ESG & sustainability-related policies and systems
Policy
Area(s) of
application Description
Code of Conduct Overarching Our Code of Conduct describes the core values and principles,
employees are expected to follow. Read more on page 74-75
Code of Conduct
for suppliers
Overarching The policy outlines our expectations to suppliers to conduct busi-
ness in an ethical, legal, and socially responsible manner. Read more on page 74-75
ESG Policy Overarching The policy outlines our environmental, social, and governmental
commitments. Read more on page 59
Diversity Policy Social The core objective of the Group Diversity Policy is to foster an
inclusive and open working climate where diversity is embraced
and promoted. We encourage and support diversity at all levels and
express our lack of tolerance towards any form of discrimination. Read more on page 69
Health & Safety
Policy
Social The policy describes our overarching principles for health and
safety in H+H. Read more on page 68
Anti-corruption
Policy
Governance The policy provides principles and information related to bribery,
facilitation payments, donations, and entertainment and gifts. Read more on page 75
Data Ethics Policy Governance The purpose of this policy is to set out the data ethical principles for
H+H’s processing of data so that the processing is not only legal,
but also ethical. Read more on page 40
Tax Policy Governance The policy describes our internal governance and management of
all matters related to tax. Read more on page 76
Whistleblower
Policy
Governance The policy includes information on how to report suspected
misconduct, how reports are handled and what is deemed inside
and outside scope. Read more on page 75
76
Annual Report 2023 In brief
Governance information
Sustainability statementBusiness and strategy Results Governance Financial statements
Summary of metrics and appendix
Environmental data UoM 2023 2022 2021 2020 2019
CO
2
e scope 1 Tonnes *93,602 142,796 132,345 121,598 142,319
CO
2
e scope 2 - market based Tonnes *15,198 33,454 59,461 56,765 56,890
CO
2
e scope 2 - location based Tonnes 29,369 45,702
CO
2
e scope 3 Tonnes 442,582 688,192 673,554 624,247 694,255
Total GHG emissions - market based Tonnes 550,501 864,442 865,360 802,609 893,465
CO
2
e scope 1 kg/m
3
31 33 31 31 33
CO
2
e scope 2 kg/m
3
5 8 14 14 13
CO
2
e scope 3 kg/m
3
146 157 157 157 162
Total GHG emission per net revenue Tonnes/Mil. DKK 206 240 287 302 315
Energy consumption GJ 1,749,942 2,487,149 2,380,949 2,195,301 2,419,731
Energy consumption MWh 486,095 690,875 661,375 609,806 672,147
Natural gas MWh 315,096 418,262
Coal MWh 92,588 146,867
Oil MWh 12,458 26,253
Fossil steam and electricity MWh 28,767 65,722
Renewable electricity MWh 37,186 33,770
Percentage renewable % 8% 5% 0% 0% 0%
Total energy per m
3
MJ 575 567 554 551 565
Energy intensity per net revenue MWh/Mil. DKK 182 192 219 230 237
Production volume:
AAC Million m
3
2.3 3.3 3.2 2.9 3.2
CSU Million m
3
0.8 1.1 1.1 1.1 1.1
* ESG figure subject to limited assurance
Social data UoM 2023 2022 2021 2020 2019
Employees Headcount 1,355 1,739 1.,633 1,571 1,636
Gender diversity % 18% 16% 16% 15% 15%
Gender diversity, office workers % 45% 41% 47% 47% 44%
Gender pay gap (Average) % -5% 7% 10% 15% 20%
CEO Pay Ratio Times 29 32 37 35 39
Employee turnover ratio % 40% 15% 13% 14% 12%
Employee turnover Headcount 605 267 206 217 191
Sickness Absence Days per FTE 14 13 12 13 13
Sickness absence, short-term Days per FTE 10 11 10 11 11
Fatalities Headcount 0 0 0 0 0
Lost-time Incident frequency (LTIF) Incident permil *3.4 3.6 5.5 5.7 5.6
Total recordable incidents Number of 18 77 103 105 131
Total recordable incident rate (TRIR) Incident permil 7 25 35 38 43
Recordable work-related ill health Number of 0 - - - -
Gender diversity, Board % 29% 33% 17% 17% 17%
Gender diversity, Group Management % 0% 0% 20% 20% 20%
Gender diversity, Managers below
Group management
%
0% - - - -
77
Annual Report 2023 In brief
Summary of metrics and appendix
Sustainability statementBusiness and strategy Results Governance Financial statements
Reporting scope
All entities under financial control by H+H
International A/S.
Reporting framework
The sustainability statement has been struc-
tured in preparation for compliance with the
Corporate Sustainability Reporting Directive
(CSRD) and the European Sustainability
Reporting Standards (ESRS).
Controls
Data regarding number of employees and
gender are generated from our HR systems.
Data regarding fatalities and accidents, energy
consumption and our GHG emissions are
reported through the operations management
system that follows normal financial processes
to ensure consistency and is validated against
the external financial reporting. The data is
verified through internal controls, analysis,
benchmarks, and monthly business meetings.
Definitions
Climate
• CO
2
e scope 1 is calculated as combusted fuel
type x conversion factor per fuel type.
For 1 tonnes of coal a conversion factor
ESG accounting policy
between 19 and 23 to GJ is used, based on
the quality of the product.
For other combustion fuels an emission
factor is applied based on DEFRA factors
• CO
2
e scope 2 is calculated as purchased
MWh x conversion factor of 3.6 to GJ is used.
For both location- and marked-based elec-
tricity, emission factors are based on AIB.
Additionally, for market-based we adjust for
the purchase of RECs in our emissions
• CO
2
e scope 3 is calculated as purchased
materials in scope x efficiency factor. Where
efficiency factors are disclosed by the
supplier this is used. If such are not available
generic industry efficiency factors are applied
• CO
2
e per m³ (scope 1) and CO
2
e per m³
(scope 2) are calculated as scope 1 and
scope 2 divided by net-production volume
• Total Energy is calculated as combusted
fuel type x power factor per fuel type + used
electricity
• Total Energy per m³ is calculated as Total
Energy divided by production volume
• Production volume is defined as produced
AAC and CSU (net) measured in m
3
Diversity & equality
• Headcount is defined as all employees who
are on our payroll, both fulltime and part-
time, as well as active and non-active
• Full-time workforce is defined as active full-
time employees + temporary workers
• Gender diversity, Group Management
includes the Executive Board and Senior
Executives at H+H International A/S.
Managers below Group management are
defined as those with direct reports
• Gender pay gap is calculated as difference of
average pay levels between female and male
employees, expressed as percentage of the
average pay level of male employees
• CEO pay ratio is calculated as CEO compen-
sation, as reported in the Remuneration
Report, divided by the median salary of all
other employees
• Employee turnover ratio is calculated as total
leavers divided by average FTEs for the year
Health & safety
• A fatality is a work-related injury that results
in death
• Lost-Time Incident Frequency (LTIF) meas-
ures the frequency of Lost-Time Incidents
and fatality incidents per million hours
divided by total hours worked following the
OSHA guidelines
• Total Recordable Incident Rate (TRIR) meas-
ures the frequency of all work-related inju-
ries and fatality incidents per million hours
divided by total hours worked
• Sickness absence is calculated as total sick
days divided by average number of FTEs
during the year
• Short-term absence is defined as sick leave
where H+H provides the primary compen-
sation to the employee. Once the primary
compensation transitions to be provided
by a public body, the absence is considered
long-term
78
Annual Report 2023 In brief
ESG accounting policy
Sustainability statementBusiness and strategy Results Governance Financial statements
Disclosure Requirement
and related datapoint SFDR reference Pillar 3 reference
Benchmark Regulation
reference
EU Climate
Law reference
Material/
Not material
Paragraph or
page reference
ESRS 2 GOV-1 Board’s gender diversity paragraph 21 (d) Indicator number 13 of Table #1 of Annex 1 Commission Delegated Regulation
(EU) 2020/1816, Annex II
Material p. 41-43, 70
ESRS 2 GOV-1 Percentage of board members who are independ-
ent paragraph 21 (e)
Delegated Regulation (EU)
2020/1816, Annex II
Material p. 39
ESRS 2 GOV-4 Statement on due diligence paragraph 30 Indicator number 10 Table #3 of Annex I Material p. 52
ESRS 2 SBM-1 Involvement in activities related to fossil fuel
activities paragraph 40 (d) i
Indicators number 4 Table #1 of Annex I Article 449a Regulation (EU) No 575/2013: Commission
Implementing Regulation (EU) 2022/2453 Table 1: Qualitative
information on Environmental risk and Table 2: Qualitative
information on Social risk
Delegated Regulation (EU)
2020/1816, Annex II
Not material
ESRS 2 SBM-1 Involvement in activities related to chemical
production paragraph 40 (d) ii
Indicator number 9 Table #2 of Annex I Delegated Regulation (EU)
2020/1816, Annex II
Not material
ESRS 2 SBM-1 Involvement in activities related to controversial
weapons paragraph 40 (d) iii
Indicator number 14 Table #1 of Annex 1 Delegated Regulation (EU)
2020/1818, Article 12(1) Delegated
Regulation (EU) 2020/1816, Annex II
Not material
ESRS 2 SBM-1 Involvement in activities related to cultivation and
production of tobacco paragraph 40 (d) iv
Delegated Regulation (EU)
2020/1818, Article 12(1) Delegated
Regulation (EU) 2020/1816, Annex II
Not material
ESRS E1-1 Transition plan to reach climate neutrality by 2050
paragraph 14
Regulation (EU)
2021/1119, Article
2(1)
Material p. 57
ESRS E1-1 Undertakings excluded from Paris-aligned Bench-
marks paragraph 16 (g)
Article 449a Regulation (EU) No 575/2013; Commission Imple-
menting Regulation (EU) 2022/2453 Template 1: Banking book
Climate Change transition risk: Credit quality of exposures by
sector, emissions and residual maturity
Delegated Regulation (EU)
2020/1818, Article12.1 (d) to (g), and
Article 12.2
Not material
ESRS E1-4 GHG emission reduction targets paragraph 34 Indicator number 4 Table #2 of Annex 1 Article 449a Regulation (EU) No 575/2013; Commission Imple-
menting Regulation (EU) 2022/2453 Template 3: Banking book
– Climate change transition risk: alignment metrics
Delegated Regulation (EU)
2020/1818, Article 6
Material p. 60
ESRS E1-5 Energy consumption from fossil sources disaggregat-
ed by sources (only high climate impact sectors) paragraph 38
Indicator number 5 Table #1 and Indicator
n. 5 Table #2 of Annex 1
Material p. 61
ESRS E1-5 Energy consumption and mix paragraph 37 Indicator number 5 Table #1 of Annex 1 Material p. 61
ESRS E1-5 Energy intensity associated with activities in high
climate impact sectors paragraphs 40 to 43
Indicator number 6 Table #1 of Annex 1 Material p. 61
ESRS 2 Appendix B
79
Annual Report 2023 In brief
ESG accounting policy
Sustainability statementBusiness and strategy Results Governance Financial statements
Disclosure Requirement
and related datapoint SFDR reference Pillar 3 reference
Benchmark Regulation
reference
EU Climate
Law reference
Material/
Not material
Paragraph or
page reference
ESRS E1-6 Gross scope 1, 2, 3 and Total GHG emissions para-
graph 44
Indicators number 1 and 2 Table #1 of
Annex 1
Article 449a; Regulation (EU) No 575/2013; Commission
Implementing Regulation (EU) 2022/2453 Template 1: Banking
book – Climate change transition risk: Credit quality of expo-
sures by sector, emissions and residual maturity
Delegated Regulation (EU)
2020/1818, Article 5(1), 6 and 8(1)
Material p. 61-62
ESRS E1-6 Gross GHG emissions intensity paragraphs 53 to 55 Indicators number 3 Table #1 of Annex 1 Article 449a Regulation (EU) No 575/2013; Commission Imple-
menting Regulation (EU) 2022/2453 Template 3: Banking book
– Climate change transition risk: alignment metrics
Delegated Regulation (EU)
2020/1818, Article 8(1)
Material p. 62
ESRS E1-7 GHG removals and carbon credits paragraph 56 Regulation (EU)
2021/1119, Article
2(1)
Not material
ESRS E1-9 Exposure of the benchmark portfolio to climate-relat-
ed physical risks paragraph 66
Delegated Regulation (EU)
2020/1818, Annex II Delegated Regu-
lation (EU) 2020/1816, Annex II
Not material
ESRS E1-9 Disaggregation of monetary amounts by acute and
chronic physical risk paragraph 66 (a) ESRS E1-9 Location of
significant assets at material physical risk paragraph 66 (c).
Article 449a Regulation (EU) No 575/2013; Commission
Implementing Regulation (EU) 2022/2453 paragraphs 46 and
47; Template 5: Banking book - Climate change physical risk:
Exposures subject to physical risk.
Not material
ESRS E1-9 Breakdown of the carrying value of its real estate
assets by energy-efficiency classes paragraph 67 (c).
Article 449a Regulation (EU) No 575/2013; Commission
Implementing Regulation (EU) 2022/2453 paragraph 34;Tem-
plate 2:Banking book -Climate change transition risk: Loans
collateralised by immovable property - Energy efficiency of the
collateral
Not material
ESRS E1-9 Degree of exposure of the portfolio to climate-related
opportunities paragraph 69
Delegated Regulation (EU)
2020/1818, Annex II
Not material
ESRS E2-4 Amount of each pollutant listed in Annex II of the
E-PRTR Regulation (European Pollutant Release and Transfer
Register) emitted to air, water and soil, paragraph 28
Indicator number 8 Table #1 of Annex 1
Indicator number 2 Table #2 of Annex 1
Indicator number 1 Table #2 of Annex 1
Indicator number 3 Table #2 of Annex 1
Not material
ESRS E3-1 Water and marine resources paragraph 9 Indicator number 7 Table #2 of Annex 1 Not material
ESRS E3-1 Dedicated policy paragraph 13 Indicator number 8 Table 2 of Annex 1 Not material
ESRS E3-1 Sustainable oceans and seas paragraph 14 Indicator number 12 Table #2 of Annex 1 Not material
ESRS E3-4 Total water recycled and reused paragraph 28 (c) Indicator number 6.2 Table #2 of Annex 1 Not material
80
Annual Report 2023 In brief
ESG accounting policy
Sustainability statementBusiness and strategy Results Governance Financial statements
Disclosure Requirement
and related datapoint SFDR reference Pillar 3 reference
Benchmark Regulation
reference
EU Climate
Law reference
Material/
Not material
Paragraph or
page reference
ESRS E3-4 Total water consumption in m
3
per net revenue on own
operations paragraph 29
Indicator number 6.1 Table #2 of Annex 1 Not material
ESRS 2- IRO 1 - E4 paragraph 16 (a) i Indicator number 7 Table #1 of Annex 1 Not material
ESRS 2- IRO 1 - E4 paragraph 16 (b) Indicator number 10 Table #2 of Annex 1 Not material
ESRS 2- IRO 1 - E4 paragraph 16 (c) Indicator number 14 Table #2 of Annex 1 Not material
ESRS E4-2 Sustainable land / agriculture practices or policies
paragraph 24 (b)
Indicator number 11 Table #2 of Annex 1 Not material
ESRS E4-2 Sustainable oceans / seas practices or policies
paragraph 24 (c)
Indicator number 12 Table #2 of Annex 1 Not material
ESRS E4-2 Policies to address deforestation paragraph 24 (d) Indicator number 15 Table #2 of Annex 1 Not material
ESRS E5-5 Non-recycled waste paragraph 37 (d) Indicator number 13 Table #2 of Annex 1 Not material
ESRS E5-5 Hazardous waste and radioactive waste paragraph 39 Indicator number 9 Table #1 of Annex 1 Not material
ESRS 2- SBM3 - S1 Risk of incidents of forced labour paragraph
14 (f)
Indicator number 13 Table #3 of Annex I Not material
ESRS 2- SBM3 - S1 Risk of incidents of child labour paragraph
14 (g)
Indicator number 12 Table #3 of Annex I Not material
ESRS S1-1 Human rights policy commitments paragraph 20 Indicator number 9 Table #3 and Indicator
number 11 Table #1 of Annex I
Material p. 69
ESRS S1-1 Due diligence policies on issues addressed by the
fundamental International Labor Organisation Conventions 1 to
8, paragraph 21
Delegated Regulation (EU)
2020/1816, Annex II
Material p. 68-69, 72
ESRS S1-1 processes and measures for preventing trafficking in
human beings paragraph 22
Indicator number 11 Table #3 of Annex I Not material
ESRS S1-1 workplace accident prevention policy or management
system paragraph 23
Indicator number 1 Table #3 of Annex I Material p. 68
ESRS S1-3 grievance/complaints handling mechanisms para-
graph 32 (c)
Indicator number 5 Table #3 of Annex I Material p. 75
ESRS S1-14 Number of fatalities and number and rate of work-re-
lated accidents paragraph 88 (b) and (c)
Indicator number 2 Table #3 of Annex I Delegated Regulation (EU)
2020/1816, Annex II
Material p. 68
ESRS S1-14 Number of days lost to injuries, accidents, fatalities or
illness paragraph 88 (e)
Indicator number 3 Table #3 of Annex I Material p. 68
81
Annual Report 2023 In brief
ESG accounting policy
Sustainability statementBusiness and strategy Results Governance Financial statements
Disclosure Requirement
and related datapoint SFDR reference Pillar 3 reference
Benchmark Regulation
reference
EU Climate
Law reference
Material/
Not material
Paragraph or
page reference
ESRS S1-16 Unadjusted gender pay gap paragraph 97 (a) Indicator number 12 Table #1 of Annex I Delegated Regulation (EU)
2020/1816, Annex II
Material p. 71
ESRS S1-16 Excessive CEO pay ratio paragraph 97 (b) Indicator number 8 Table #3 of Annex I Material p. 71
ESRS S1-17 Incidents of discrimination paragraph 103 (a Indicator number 7 Table #3 of Annex I Material p. 71
ESRS S1-17 Nonrespect of UNGPs on Business and Human Rights
and OECD paragraph 104 (a)
Indicator number 10 Table #1 and Indica-
tor n. 14 Table #3 of Annex I
Delegated Regulation (EU)
2020/1816, Annex II Delegated Regu-
lation (EU) 2020/1818 Art 12 (1)
Material p. 71
ESRS 2- SBM3 – S2 Significant risk of child labour or forced
labour in the value chain paragraph 11 (b)
Indicators number 12 and n. 13 Table #3
of Annex I
Not material
ESRS S2-1 Human rights policy commitments paragraph 17 Indicator number 9 Table #3 and Indicator
n. 11 Table #1 of Annex 1
Not material
ESRS S2-1 Policies related to value chain workers paragraph 18 Indicator number 11 and n. 4 Table #3 of
Annex 1
Not material
ESRS S2-1 Nonrespect of UNGPs on Business and Human Rights
principles and OECD guidelines paragraph 19
Indicator number 10 Table #1 of Annex 1 Delegated Regulation (EU)
2020/1816, Annex II Delegated Regu-
lation (EU) 2020/1818, Art 12 (1)
Not material
ESRS S2-1 Due diligence policies on issues addressed by the
fundamental International Labor Organisation Conventions 1 to
8, paragraph 19
Delegated Regulation (EU)
2020/1816, Annex II
Not material
ESRS S2-4 Human rights issues and incidents connected to its
upstream and downstream value chain paragraph 36
Indicator number 14 Table #3 of Annex 1 Not material
ESRS S3-1 Human rights policy commitments paragraph 16 Indicator number 9 Table #3 of Annex
1 and Indicator number 11 Table #1 of
Annex 1
Not material
ESRS S3-1 non-respect of UNGPs on Business and Human Rights,
ILO principles or and OECD guidelines paragraph 17
Indicator number 10 Table #1 Annex 1 Delegated Regulation (EU)
2020/1816, Annex II Delegated Regu-
lation (EU) 2020/1818, Art 12 (1)
Not material
ESRS S3-4 Human rights issues and incidents paragraph 36 Indicator number 14 Table #3 of Annex 1 Not material
ESRS S4-1 Policies related to consumers and end-users para-
graph 16
Indicator number 9 Table #3 and Indicator
number 11 Table #1 of Annex 1
Not material
82
Annual Report 2023 In brief
ESG accounting policy
Sustainability statementBusiness and strategy Results Governance Financial statements
Disclosure Requirement
and related datapoint SFDR reference Pillar 3 reference
Benchmark Regulation
reference
EU Climate
Law reference
Material/
Not material
Paragraph or
page reference
ESRS S4-1 Non-respect of UNGPs on Business and Human Rights
and OECD guidelines paragraph 17
Indicator number 10 Table #1 of Annex 1 Delegated Regulation (EU)
2020/1816, Annex II Delegated Regu-
lation (EU) 2020/1818, Art 12 (1)
Not material
ESRS S4-4 Human rights issues and incidents paragraph 35 Indicator number 14 Table #3 of Annex 1 Not material
ESRS G1-1 United Nations Convention against Corruption para-
graph 10 (b)
Indicator number 15 Table #3 of Annex 1 Not material
ESRS G1-1 Protection of whistle-blowers paragraph 10 (d) Indicator number 6 Table #3 of Annex 1 Material p. 75
ESRS G1-4 Fines for violation of anti-corruption and anti-bribery
laws paragraph 24 (a)
Indicator number 17 Table #3 of Annex 1 Delegated Regulation (EU)
2020/1816, Annex II)
Material p. 76
ESRS G1-4 Standards of anti-corruption and anti- bribery para-
graph 24 (b)
Indicator number 16 Table #3 of Annex 1 Material p. 75
83
Annual Report 2023 In brief
ESG accounting policy
Sustainability statementBusiness and strategy Results Governance Financial statements
Group Parent company
Note (DKK million) 2023 2022 2023 2022
3,11 Revenue 2,672 3,604 - -
4,11,17 Cost of goods sold (2,108 ) (2,584 ) - -
Gross profit before special items 564 1,020 - -
4,11 Sales costs (149 ) (170 ) - -
4,11 Administrative costs (197 ) (222 ) (58) (72)
5 Other operating income and costs, net 26 29 56 66
EBITDA before special items 244 657 (2) (6)
6,11 Depreciation and amortisation (187 ) (202 ) (5) (3)
EBIT before special items 57 455 (7) (9)
7 Special items, net (287 ) (42 ) (6) (14)
EBIT (230 ) 413 (13) (23)
8 Financial income 24 6 176 149
9 Financial expenses (77 ) (21 ) (43) (23)
Result before tax (283 ) 398 120 103
10 Tax 37 (81 ) 5 5
Result for the year (246 ) 317 125 108
Result for the year attributable to:
H+H International A/S' shareholders (248 ) 303 125 108
Non-controlling interest 2 14 - -
Result for the year (246 ) 317 125 108
12 Earnings per share (EPS-Basic) (DKK) (15.0 ) 17.5
12 Diluted earnings per share (EPS-D) (DKK) (15.0 ) 17.4
Group Parent company
Note (DKK million) 2023 2022 2023 2022
Result for the year (246 ) 317 125 108
Other comprehensive income:
Items that will not be reclassified subsequently to the income statement:
20 Actuarial losses and gains (68 ) 18 - -
Tax on actuarial losses and gains 15 (1 ) - -
(53 ) 17 - -
Items that may be reclassified subsequently to the income statement:
26 Fair value adjustments of derivative financial instruments (20 ) - - -
26 Gain/(loss) on derivative financial instruments transferred to the
income statements 10 - - -
Tax on fair value adjustment 3 - - -
Foreign exchange adjustments, foreign entities 63 (17 ) - -
Other comprehensive income after tax 3 - - -
Total comprehensive income for the year (243 ) 317 125 108
Income statement Statement of comprehensive income
85
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Group Parent company
Note (DKK million) 2023 2022 2023 2022
Goodwill 422 419 - -
Customer relations 179 213 - -
Other intangible assets 61 40 31 22
13 Intangible assets 662 672 31 22
Land and buildings 754 767 - -
Plant and machinery 610 652 - -
Other equipment, fixtures and fittings 77 87 3 5
Assets under construction 332 316 - -
14 Property, plant and equipment 1,773 1,822 3 5
15 Deferred tax assets 31 17 11 10
16 Equity investments in subsidiaries 1,232 1,232
16 Investments in associated companies 2 1 - -
Other receivables - 5 - -
Receivables from subsidiaries 1,510 1,235
Other non-current assets 33 23 2,753 2,477
Total non-current assets 2,468 2,517 2,787 2,504
17 Inventories 657 523 - -
18 Trade receivables 102 122 - -
Receivables from subsidiaries 76 71
18 Other receivables 74 40 1 1
Prepayments 14 12 2 1
Cash 139 358 33 44
Current assets 986 1,055 112 117
Total assets 3,454 3,572 2,899 2,621
Group Parent company
Note (DKK million) 2023 2022 2023 2022
19 Share capital 165 175 165 175
Other reserves (92 ) (155 ) - -
Retained earnings 1,519 1,822 1,565 1,435
Equity attributable to H+H International A/S's shareholders 1,592 1,842 1,730 1,610
Equity attributable to non-controlling interests 86 96 - -
Equity 1,678 1,938 1,730 1,610
20 Pension obligations 59 23 - -
21 Provisions 31 38 - -
15 Deferred tax liabilities 54 110 - -
26 Lease liabilities 95 81 2 4
25 Deferred payments, acquisition of subsidiary 99 105 - -
22 Credit institutions 907 742 836 694
Non-current liabilities 1,245 1,099 838 698
22 Credit institutions - - - -
Trade payables 278 278 7 8
26 Lease liabilities 24 27 1 2
Income tax 5 37 - 1
Payables to subsidiaries 313 278
25 Deferred payment, acquisition of subsidiary 7 7 - -
21 Provisions 7 9 - -
Other payables 210 177 10 24
Current liabilities 531 535 331 313
Total liabilities 1,776 1,634 1,169 1,011
Total equity and liabilities 3,454 3,572 2,899 2,621
Balance sheet at 31 December
Assets Equity and liabilities
86
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Group Parent company
Note (DKK million) 2023 2022 2023 2022
Operating profit (EBIT) (230 ) 413 (13) (23)
6 Depreciation, amortisation and impairment 288 202 5 3
Change in inventories (117 ) (205 ) - -
Change in receivables (12 ) 12 (6) 1
Change in trade payables and other payables 23 16 (16) 11
Other non-cash adjustments (62 ) (50 ) (3) 4
Operating activities before financial items and tax (110 ) 388 (33) (4)
8, 9 Financial items, net (53 ) (14 ) 1 15
Income tax paid (46 ) (58 ) - 5
Operating activities (209 ) 316 (32) 16
Sale of property, plant and equipment 35 11 - -
Change in borrowings to subsidiaries (240) (276)
Capital increase in subsidiaries - (2)
8 Dividend from subsidiaries 134 102
25 Acquisition of enterprises and related deferred payments (7 ) - - -
14 Acquisition of property, plant and equipment and intangible assets (165 ) (266 ) (13) (13)
Investing activities (137 ) (255 ) (119) (189)
Free cash flow (346 ) 61 (151) (173)
Group Parent company
Note (DKK million) 2023 2022 2023 2022
22 Proceeds from borrowings 245 - 245 -
Bank overdraft and other debt (80 ) 116 (103) 166
Payment of lease liabilities (32 ) (27 ) (2) (2)
Purchase of treasury shares (2 ) (169 ) (2) (169)
Financing activities 131 (80 ) 138 (5)
Cash flow for the year (215 ) (19 ) (13) (178)
Cash at 1 January 358 382 44 221
Foreign exchange adjustments of cash (4 ) (5 ) 2 1
Cash at 31 December 139 358 33 44
Cash flow statement
87
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Group
(DKK million)
Share
capital
Hedging
reserve
Trans-
lation
reserve
Retained
earnings
H+H
share-
holders
share
Non-con-
trolling
interest'
share Total
Equity at 1 January 2022 180 - (138 ) 1,662 1,704 110 1,814
Result for the year - - - 303 303 14 317
Other comprehensive income: -
Foreign exchange adjustments, foreign entities - - (17 ) - (17 ) - (17 )
Actuarial gains/losses on pension plans - - - 18 18 - 18
Tax on other comprehensive income - - - (1 ) (1 ) - (1 )
Net gains recognised directly in equity - - (17 ) 17 - - -
Total comprehensive income - - (17 ) 320 303 14 317
Acquisition of treasury shares - - - (169 ) (169 ) - (169 )
Share-based payment - - - 4 4 - 4
Share capital decrease, note 19 (5 ) - - 5 - - -
Adjustment to non-controlling interests arising
from acquisition - - - - - (22 ) (22 )
Dividend to non-controlling interests - - - - - (6 ) (6 )
Total changes in equity (5 ) - (17 ) 160 138 (14 ) 124
Equity at 31 December 2022 175 - (155 ) 1,822 1,842 96 1,938
Result for the year - - - (248 ) (248 ) 2 (246 )
Other comprehensive income: -
Foreign exchange adjustments, foreign entities - - 63 - 63 - 63
Actuarial gains/losses on pension plans - - - (68 ) (68 ) - (68 )
Fair value adjustment of derivative financial
instruments - (10 ) - - (10 ) - (10 )
Tax on other comprehensive income - 3 - 15 18 - 18
Net gains recognised directly in equity - (7 ) 63 (53 ) 3 - 3
Total comprehensive income - (7 ) 63 (301 ) (245 ) 2 (243 )
Acquisition of treasury shares - - - (2 ) (2 ) - (2 )
Share-based payment - - - (3 ) (3 ) - (3 )
Share capital decrease, note 19 (10 ) - - 10 - - -
Dividend to non-controlling interests - - - - - (12 ) (12 )
Total changes in equity (10 ) (7 ) 63 (296 ) (250 ) (10 ) (260 )
Equity at 31 December 2023 165 (7 ) (92 ) 1,526 1,592 86 1,678
Parent company
(DKK million)
Share
capital
Retained
earnings
Proposed
dividend Total
Equity at 1 January 2022 180 1,487 - 1,667
Result for the year - 108 - 108
Other comprehensive income - - - -
Total comprehensive income - 108 - 108
Acquisition of treasury shares - (169) - (169)
Share-based payment - 4 - 4
Share capital decrease, note 19 (5) 5 - -
Total changes in equity (5) (52) - (57)
Equity at 31 December 2022 175 1,435 - 1,610
Result for the year - 125 - 125
Other comprehensive income - - - -
Total comprehensive income - 125 - 125
Acquisition of treasury shares - (2) - (2)
Share-based payment - (3) - (3)
Share capital decrease, note 19 (10) 10 - -
Total changes in equity (10) 130 - 120
Equity at 31 December 2023 165 1,565 - 1,730
Statement of changes in equity
88
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes to the consolidated financial statements
Notes - Financial statements
1 Material accounting policy information 90
2 Significant estimates and judgements 91
Notes - Income statement
3 Segment information 92
4 Staff costs 93
5 Other operating income and costs before special items 94
6 Depreciation and amortisation before special items 94
7 Special items, net 95
8 Financial income 96
9 Financial expenses 96
10 Tax 96
11 Income statement classified by function 98
12 Earnings per share (EPS) 99
Notes - Balance sheet
13 Intangible assets 99
14 Property, plant and equipment 102
15 Deferred tax 104
16 Investments in subsidiaries 105
17 Inventories/cost of goods sold 106
18 Trade and other receivables 107
19 Share capital and treasury shares 108
20 Pension obligations 108
21 Provisions 112
22 Credit institutions 113
Notes - Supplementary information
23 Contingent liabilities 114
24 Auditors’ remuneration 114
25 Business combinations 115
26 Financial instruments and financial risks 115
27 Related parties 119
28 Events after the balance sheet date 119
Statement and Auditor's Reports
Statement by the Executive Board and the Board of Directors 121
Independent Auditor's Reports 122
Independent limited assurance report on selected ESG data 126
89
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
90
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
1 Material accounting policy information – continued 2 Significant estimates and judgements
91
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
92
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
93
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
4 Staff costs – continued
94
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
95
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
96
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
10 Tax – continued
97
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
98
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
Parent company
(DKK million) 2023 2022
Other
intangible
assets
Other
intangible
assets
Total cost at 1 January 23 10
Additions during the year 12 13
Total cost at 31 December 35 23
Total amortisation at 1 January (1) -
Amortisation for the year (3) (1)
Total amortisation at 31 December (4) (1)
Carrying amount at 31 December 31 22
99
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
13 Intangible assets – continued
100
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
13 Intangible assets – continued
101
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
Parent company
(DKK million) 2023 2022
Other
equipment,
fixtures and
fittings
Other
equipment,
fixtures and
fittings
Total cost at 1 January 11 10
Additions 1 1
Disposals (2) -
Total cost at 31 December 10 11
Total depreciation at 1 January (6) (4)
Depreciations for the year (2) (2)
Reversal of depreciations of disposals 1 -
Total amortisation at 31 December (7) (6)
Carrying amount at 31 December 3 5
Right-of-use assets included as
Additions - 1
Disposals (1) -
Depreciation (2) 2
Reversal of depreciations of disposals 1 -
Carrying amount at 31 December 3 5
102
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
14 Property, plant and equipment – continued
103
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
14 Property, plant and equipment – continued
104
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
15 Deferred tax – continued
Parent company
(DKK million) 2023 2022
Acquisition cost at 1 January 1,299 1,297
Additions - 2
Disposals - -
Cost at 31 December 1,299 1,299
Impairment losses at 1 January (67) (67)
Reversal of previous write-down - -
Reversal in connection with disposals - -
Impairment losses at 31 December (67) (67)
Carrying amount at 31 December 1,232 1,232
If indication of possible impairment for investment in subsidiaries exist, an impairment test is performed at the end of 2023. The
recoverable amount of the investments in subsidiaries with indication of possible impairment at 31 December 2023 is based on the
value in use, which has been determined using expected net cash flows based on estimates for the years 2023-2028 and a WACC after
tax of 9.2% (2022: 8.2%). The weighted average growth rate used for expected future net cash flows for the years after 2028 has been
estimated at 2.0% (2022: 2.0%). It is estimated that the growth rate will not exceed the long-term average growth rate in the respective
company’s markets. The impairment tests are using same principles as for the Group’s CGU’s, see note 13 for further information. No
impairment were identified in 2023 or 2022.
105
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
Impairment of financial assets
Loans to related parties and other; lifetime expected credit losses (ECL) has been provided for them upon initial application of IFRS 9
until these financial assets are derecognised as it was determined on initial application of IFRS 9 that it would require undue cost and
effort to determine whether their credit risk has increased significantly since initial recognition to the date of initial application of IFRS 9.
In determining the expected credit losses for these assets, we have taken into account the historical default experience, the financial
position of the counterparties and considering various external sources of actual and forecast economic information, as appropriate, in
estimating the probability of default of each of these financial assets occurring within their respective loss assessment time horizon, as
well as the loss upon default in each case.
There has been no change in the estimation techniques or significant assumptions made during the current reporting period in assess-
ing the loss allowance for these financial assets. Loans to subsidiaries are denominated in EUR and therefore not exposed to foreign
exchange risks.
Accounting policies
Equity investments in subsidiaries in the parent company’s financial statements: Equity investments in subsidiaries are measured at
cost. If there is any indication of impairment or reversal of prior year’s impairment, an impairment test is carried out as described in note
13. Cost is written down to the recoverable amount whenever the carrying amount is higher.
106
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
107
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
108
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
20 Pension obligations – continued
109
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
20 Pension obligations – continued
110
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
20 Pension obligations – continued
111
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
112
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
113
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
114
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
115
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
Parent company’s monetary items and sensitivity
(DKK million) 2023 2022
Position Sensitivity Position Sensitivity
Cash and
receivables
Potential
volatility of
exchange
rate
Hypothetical
impact on
profit before
tax for the
year*
Hypothetical
impact on
equity
Cash and
receivables
Potential
volatility of
exchange
rate
Hypothetical
impact on
profit before
tax for the
year*
Hypothetical
impact on
equity
EUR/DKK 1,346 1% 13 10 1.002 1% 10 8
GBP/DKK (115) 5% (5) (4) (140) 5% (7) (5)
8 6 3 3
* The hypothetical impact on result and equity is significant to the parent company’s financial statements but not necessarily to the consolidated financial
statements.
The parent company has significant monetary items in currencies other than the functional currency in the form of loans to subsidiaries.
The table above shows the parent company’s key monetary positions broken down by currency and derived sensitivity.
26 Financial instruments and financial risks – continued
116
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
26 Financial instruments and financial risks – continued
117
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
26 Financial instruments and financial risks – continued
118
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Notes – Financial statements
26 Financial instruments and financial risks – continued
27 Related parties
H+H International A/S has no controlling shareholders. Besides the parties specified above, the parent company’s related parties
consist of its subsidiaries; see note 16.
Parent Company
A management fee totaling DKK 56 million (2022: DKK 65 million) was received by the parent Company from the remainder of the
Group.
Transactions between the parent company and subsidiaries also include deposits, loans and interest; these are shown in the parent
company balance sheet and notes 8 and 9.
There were no material unsettled balances with related parties at the end of the year.
Trading with related parties is at arm’s length.
119
Annual Report 2023
Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Financial ratios & Glossary
Financial ratios
Other financial ratios have been prepared in accordance with the Danish Finance Society‘s guidelines.
The financial ratios under Key figures in the Management's review have been calculated as follows:
Gross margin Gross profit x 100
Revenue
EBITDA margin EBITDA x 100
Revenue
EBIT margin EBIT x 100
Revenue
Return on invested capital * EBIT
Average invested capital
Earnings per share (EPS) Result for the year
Average number of shares outstanding
Diluted earnings per share (EPS-D) Diluted earnings
Diluted average number of shares outstanding
Solvency ratio Equity at year-end (attributable to H+H) x 100
Total equity and liabilities, year-end
Financial gearing Net interest-bearing debt, year-end
EBITDA
* Return on invested capital is measured on a twelve months basis.
Glossary
EBITDA Operating profit before depreciation, amortization and financial items
EBIT Operating profit before financial items
Special items Refer to note 7 for accounting policy for special items
Margins before special items Consists of defined margins adjusted for special items re above and note 7
Organic growth Revenue growth excluding effects from changes in foreign exchange rates and revenue from
acquisitions and divestments
FTE and avarage FTE Full-time employees and average number of full-time employees
Free cash flow The sum of cash flow from operating and investing activities
Net working capital Net working capital is inventories, trade receivables, and other receivables less trade payables
and other payables.
Invested capital Invested capital is calculated as net working capital plus tangible assets and intangible assets
excluding goodwill deducted by provisions and operating non-current liabilities.
Earnings per share Earnings per share (EPS) and diluted earnings per share (EPS-D) are determined in accord-
ance with IAS 33.
Net interest-bearing debt Net interest-bearing debt is credit institutions and lease liabilities less cash funds
CSRD Corporate Social Responsibility Directive
ESRS European Sustainability Reporting Standards
SBM Strategy and Business Model
MDR Minimum Disclosure Requirement
IRO Impacts, Risks and Opportunities
GOV Governance
REC Renewable Energy Certificate
BP Basis for Preparation
EEA European Economic Area
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Financial statements
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Executive Board
Board of Directors
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Statement by the Executive Board and the Board of Directors
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Independent Auditor’s Reports
Report on the audit of the Financial Statements
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Independent Auditor’s Reports
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
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Independent Auditor’s Reports
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Independent Auditor’s Reports
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
CVR no 3 3 7 7 1 2 31
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Independent Auditor’s Reports
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
To the Stakeholders of
H+H International A/S
H+H International A/S engaged us to obtain
limited assurance on Gross scope 1 GHG emis-
sions (tCO
2
eq), Gross market-based scope 2
GHG emissions (tCO
2
eq) and Lost-time inci-
dent frequency (LTIF) for the period 1 January
- 31 December 2023 stated (the “Selected ESG
data").
Our conclusion
Based on the procedures we performed and
the evidence we obtained, nothing came to our
attention that causes us not to believe that the
Selected ESG data for the period 1 January - 31
December 2023 for H+H International A/S are
prepared, in all material respects, in accord-
ance with the applied accounting policies
developed by H+H International A/S as stated
on page 78 (the “ Accounting policies”).
This conclusion is to be read in the context of
what we state in the remainder of our report.
Independent limited assurance report
on selected ESG data
What we are assuring
The scope of our work was limited to assurance
over the Selected ESG data in the 2023 Annual
Report of H+H International A/S:
• Gross Scope 1 GHG emissions (tCO
2
eq)
(page 62)
• Gross market-based Scope 2 GHG emissions
(tCO
2
eq) (page 62)
• Lost-time incident frequency (LTIF) (page
68)
We express limited assurance in our conclu-
sion.
Corresponding information
With effect from the current financial year, the
Selected ESG data have become subject to a
limited assurance engagement. Please note
that the comparative information stated in
the Selected ESG data has not been subject
to assurance, which also appears from the
Selected ESG data.
Professional standards applied
and level of assurance
We performed a limited assurance engage-
ment in accordance with International
Standard on Assurance Engagements 3000
(Revised) ‘Assurance Engagements other
than Audits and Reviews of Historical Financial
Information’ and, in respect of the greenhouse
gas emissions, in accordance with Interna-
tional Standard on Assurance Engagements
3410 ‘Assurance engagements on greenhouse
gas statements’. The quantification of green-
house gas emissions is subject to inherent
uncertainty because of incomplete scientific
knowledge used to determine the emissions
factors and the values needed to combine
emissions of different gasses.
A limited assurance engagement is substan-
tially less in scope than a reasonable assurance
engagement in relation to both the risk assess-
ment procedures, including an understanding
of internal control, and the procedures
performed in response to the assessed risks;
consequently, the level of assurance obtained
in a limited assurance engagement is substan-
tially lower than the assurance that would have
been obtained had a reasonable assurance
engagement been performed.
Our independence and quality control
We have complied with the independence
requirements and other ethical requirements
in the International Ethics Standards Board
for Accountants’ International Code of Ethics
for Professional Accountants (IESBA Code),
which is founded on fundamental principles of
integrity, objectivity, professional competence
and due care, confidentiality and professional
behaviour and ethical requirements applicable
in Denmark.
PricewaterhouseCoopers applies International
Standard on Quality Management 1, ISQM 1,
which requires the firm to design, implement
and operate a system of quality management
including policies or procedures regarding
compliance with ethical requirements, profes-
sional standards and applicable legal and
regulatory requirements.
126
Annual Report 2023
Independent limited assurance report on selected ESG data
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Our work was carried out by an independent
multidisciplinary team with experience in
sustainability reporting and assurance.
Understanding reporting and
measurement methodologies
The Selected ESG data need to be read and
understood together with the accounting
policies. The accounting policies used for the
preparation of the Selected ESG data are the
accounting policies developed by H+H Inter-
national A/S, which Management is solely
responsible for selecting and applying.
The absence of a significant body of estab-
lished practice on which to draw to evaluate
and measure sustainability data allows for
different, but acceptable, measurement tech-
niques and can affect comparability between
entities and over time.
Work performed
We are required to plan and perform our
work in order to consider the risk of mate-
rial misstatement of the Selected ESG data.
In doing so and based on our professional
judgement, we:
• Evaluated the appropriateness of the
accounting policies used and their consistent
application in the Selected ESG data;
• Made inquiries and conducted interviews
with management with responsibility for
management and reporting of the Selected
ESG data to assess reporting and consolida-
tion process, use of company-wide systems
and controls performed;
• Checked the Selected ESG data on a sample
basis to underlying documentation and
evaluated the appropriateness of quanti-
fication methods and compliance with the
accounting policies used for preparing the
Selected ESG data;
• Performed analytical review and trend expla-
nation of the Selected ESG data; and
• Evaluated the obtained evidence.
Management’s responsibilities
Management of H+H International A/S is
responsible for:
• Designing, implementing and maintaining
internal control over information relevant
to the preparation of the Selected ESG data
that are free from material misstatement,
whether due to fraud or error;
• Establishing objective accounting policies
for preparing the Selected ESG data;
• Measuring and reporting the information
in the Selected ESG data based on the
accounting policies; and
• The content of the Selected ESG data.
Our responsibility
We are responsible for:
• Planning and performing the engagement to
obtain limited assurance about whether the
Selected ESG data for the period 1 January
– 31 December 2023 are prepared, in all
material respects, in accordance with the
accounting policies;
• Forming an independent conclusion, based
on the procedures performed and the
evidence obtained; and
• Reporting our conclusion to the stake-
holders of H+H International A/S.
Hellerup, 5 March 2024
PricewaterhouseCoopers
Statsautoriseret Revisionspartnerselskab
CVR no 3377 1231
Jacob F Christiansen Poul P. Petersen
State Authorised State Authorised
Public Accountant Public Accountant
mne18628 mne34503
127
Annual Report 2023
Independent limited assurance report on selected ESG data
In brief Sustainability statementBusiness and strategy Results Governance Financial statements
Contact information
Group Head Office
Telephone: +45 35 27 02 00
E-mail: inf[email protected]
Company Reg. No.: 49 61 98 12
H+H Benelux B.V.
Nikkelstraat 4
6031 TR Nederweert
Netherlands
Tel.: +31 49 54 50 169
www.HplusH.nl
H+H Denmark
Skanderborgvej 234
8260 Viby J
Denmark
Tel.: +45 70 24 00 50
www.HplusH.dk
H+H Germany
Hans-Böckler-Straße 33
40468 Düsseldorf
Germany
Tel.: +49 45 54 70 00
www.HplusH.de
H+H Sweden
Mobilvägen 3
246 43 Löddeköpinge
Sweden
Tel.: +46 40 55 23 00
www.HplusH.se
H+H Czech Republic
Beroun-Meˇsto 660
26601 Beroun
Czech Republic
Tel.: +420 311 644 705
www.VAPIS-sh.cz
H+H Switzerland
Aarauerstrasse 75
5200 Brugg
Switzerland
Tel.: +41 56 46 05 466
www.hunziker-kalksandstein.ch
H+H UK
Celcon House
Ightham
Sevenoaks
Kent TN15 9HZ
UK
Tel.: +44 17 32 88 63 33
www.HplusH.co.uk
H+H Poland
ul.Kupiecka 6
03-046 Warsaw
Poland
Tel.: +48 22 51 84 000
www.HplusH.pl
128
Annual Report 2023 In brief
Contact information
Sustainability statementBusiness and strategy Results Governance Financial statements
1909
Henriksen &
W. Kähler established
joint gravel pit
enterprise
1937
Business
expanded with
Danish Aircrete
and Rockwool
Partnership
2011
After the 2008-2009
financial crisis,
streamlining of the
Group is commenced
2023
As a response
to the macro-
economic turmoil
in Europe, business
improvement plans
are initiated
2000
Focus on
aircrete—expansion to
Finland and Germany
2019
Divestment of the
Russian business
and acquisition of
one CSU plant in
Germany
1958
H+H enters the
UK—joint venture
with Celcon
1962
Henriksen & W. Kähler
divided Rockwool
activities from the
other activities
2009
Opening of plant
near St. Petersburg,
Russia
1985
H+H’s B shares
listed on the
Copenhagen Stock
Exchange
2017
H+H enters the CSU
markets through
acquisitions in
Germany, Switzerland
and Poland
2020
Acquisition of
one AAC plant
in Germany
2005
Expansion into
Poland
2022
H+H delivers
the best result
ever
2015
Restructuring of
the Polish aircrete
market
H+H as a
conglomerate
1909–1998
H+H as a
consolidator
1998–2021
H+H as a Partner
in Wall Building
2023
Turnaround
2011–2015
Restructuring
of the European
white-stone
markets
2015–2021
2021
Acquisitions
of one AAC plant and
one combined AAC
and CSU plant in
Germany
More than 100 years
of experience
129
Annual Report 2023 In brief
More than 100 years of experience
Sustainability statementBusiness and strategy Results Governance Financial statements
H+H International A/S
Lautrupsgade 7, 5th Floor
Denmark
Telephone: +45 35 27 02 00
Email: info@HplusH.com
HplusH.com