Solar A/S
LEI: 21380031XTLI9X5MTY92
Industrivej Vest 43, DK-6600 Vejen, Denmark
Tel. +45 79 30 00 00
CVR no. 15 90 84 16
www.solar.eu
ANNUAL REPORT 2022
In 2022, we achieved a record high EBITDA of DKK 1,175m. This was an increase of
DKK 264m or 29%, which exceeded our expectations.
CEO Jens Andersen says:
"In 2022, we achieved strong growth rates and improved earnings across all our
segments. We delivered an EBITDA of DKK 1,175m. This is an EBITDA increase of
29% and, thus, an all-time high EBITDA margin of 8.5%. This was achieved in a year
with unusual market conditions including challenging supply chains and a substantial
increase in inflation.
We reduced our Scope 1 & 2 emissions by a total of 23% in 2022. This supports our
ambition of reaching Net-Zero by 2030. In addition, we have raised our ambitions further
to now also comprising Scope 3 emissions, for which we have requested SBTi to
validate a 25% reduction by 2030 compared to 2020.
I am impressed by the high level of dedication and commitment shown by our
employees during the year and would like to extend my gratitude to them all. They are
the reason for this yearās strong results.ā
Financial highlights (DKK million)
Q4 2022
Q4 2021
2022
2021
Revenue
3,684
3,380
13,863
12,354
EBITDA
326
259
1,175
911
EBITA
274
212
978
727
Earnings before tax
223
184
858
622
Cash flow from operating activities
242
558
16
783
Financial ratios (%)
Organic growth adj. for number of working days
12.0
7.1
12.9
5.9
EBITDA margin
8.8
7.7
8.5
7.4
EBITA margin
7.4
6.3
7.1
5.9
Net working capital, end of period/revenue (LTM)
15.9
10.2
15.9
10.2
Gearing (NIBD/EBITDA), no. of times
0.9
0.0
0.9
0.0
Return on invested capital (ROIC)
25.5
24.6
25.5
24.6
9 February 2023
Announcement no. 1 2023
Solar
A/S
LEI: 21380031XTLI9X5MTY92
Industrivej Vest 43, DK-6600 Vejen, Denmark
Tel. +45 79 30 00 00
CVR no. 15 90 84 16
www.solar.eu
9 February 2023
Announcement no. 1 2023
2022 revenue
ā¢ Adjusted organic growth increased to 12.9% (5.9%) and revenue rose to DKK 13.9bn
(DKK 12.4bn). Although growth was supported by price increases, we continued to
see growth in volume.
2022 EBITDA
ā¢ EBITDA increased by DKK 264m to DKK 1,175m compared to 2021.
ā¢ All markets achieved substantial improvements in EBITDA, with Solar Nederland and
Solar Sverige making a significant contributionī
Dividend distribution
ā¢ At the Annual General Meeting, the Board of Directors will propose dividend
distribution of DKK 45.00 per share, corresponding to a payout ratio of 50%.
2023 outlook
ā¢ We expect revenue of approx. DKK 13,700m equal to an organic growth of approx.
0%.
ā¢ We expect an EBITDA of approx. DKK 900m.
See the assumptions on page 8 in Annual Report 2022.
Audio webcast and teleconference today
The presentation of Annual Report 2022 will be made in English on 9 February 2023 at
11:00 CET. The presentation will be transmitted as an audio webcast and will be
available at www.solar.eu. Participation will be possible via teleconference.
Teleconference call-in numbers:
DK: tel. +45 787 684 90
UK: tel. +44 203 769 6819
US: tel. +1 646 787 0157 Pin: 392423
Contacts
CEO Jens Andersen - tel. +45 79 30 02 01
CFO Michael H. Jeppesen - tel. +45 79 30 02 62
IR Director Dennis Callesen - tel. +45 29 92 18 11
Enclosure: Annual Report 2022, pages 1-147, including Q4 2022 quarterly information.
Solar
A/S
LEI: 21380031XTLI9X5MTY92
Industrivej Vest 43, DK-6600 Vejen, Denmark
Tel. +45 79 30 00 00
CVR no. 15 90 84 16
www.solar.eu
9 February 2023
Announcement no. 1 2023
FACTS ABOUT SOLAR
Solar is a leading European sourcing and services company mainly within electrical,
heating & plumbing and climate & energy solutions. Our core business centres on
product sourcing, value-adding services and optimisation of our customersā businesses.
We facilitate efficiency improvement and provide digital tools that turn our customers
into winners. We drive the green transition and provide best-in-class solutions to ensure
sustainable use of resources.
Solar Group is headquartered in Denmark, generated revenue of approx. DKK 13.9bn in
2022 and has approx. 3,000 employees. Solar is listed on Nasdaq Copenhagen and
operates under the short designation SOLAR B. For more information, please visit
www.solar.eu.
Disclaimer
This announcement was published in Danish and English today via Nasdaq
Copenhagen. In the event of any inconsistency between the two versions, the Danish
version shall prevail.
CVR no. 15 90 84 16
2022
Annual report
We are a leading
Who we are
Solar A/S - Annual Report 2022
Installation
Industry Trade
Electrical
Concepts
Heating & Plumbing
Other brands
Climate & Energy
23
%
17
%
77
%
Denmark
Sweden
Norway
Poland
Other
1
33
16
4
3
%
%
%
%
%
Groups
Brands
Share of revenue
Share of revenue
Share of revenue
ProductsSegments
Markets
The Netherlands
24
%
20
58
%
33
%
9
%
73
%
10
%
1) Including eliminations
Solar A/S - Annual Report 2022 2
Management review
Our purpose
We improve construction,
building operation and industry
processes with a commitment to
sustainability and productivity.
For our customers. With our
partners. For a better world.
Additional reports
Together with the Annual Report, the
following publications constitute
Solarās reporting for the year 2022:
Sustainability Report 2022 prepared
in compliance with sections
99a, 99b and 107d of the Danish
Financial Statements Act.
Statutory report on corporate
governance 2022 cf. Ā§ 107b of the
Danish Financial Statements Act
Statutory report on data ethics
2022 cf. Ā§ 99d of the Danish
Financial Statements Act
WWW.SOLAR.EU/INVES TOR/
WWW.SOLAR.EU/INVES TOR/
Contents
Letter from the CEO 4
Year at glance 5
Highlights 2022 6
Guidance follow-up 2022 7
Guidance 2023 8
Business model 10
Our strategy 11
Ambitions for 2023 12
Update of strategic
focus areas 13
Five-year summary 16
Financial review 17
Segments 19
Sustainability highlights 23
Climate & energy solutions 24
Risk management 27
Group risks and mitigation 29
Corporate governance 33
Board of Directors 34
Executive Management 36
Shareholder information 39
Summary for the Solar Group 42
Statement of comprehensive
income 44
Balance sheet 45
Cash flow statement 46
Statement of changes in equity 47
Notes 49
Statement of comprehensive
income 90
Balance sheet 91
Cash flow statement 92
Statement of changes in equity 93
Notes 95
Group companiesā overview 128
Statement by the Executive Board
and the Board of Directors 130
Independent auditorās report 131
Quarterly figures 136
Financial review 139
Statement of comprehensive income 142
Balance sheet 143
Cash flow statement 144
Segment information 145
Management review Financial statements
01
03
Highlights
Financial review
04
Sustainability
Consolidated financial
statements
Separate financial statements
Group companiesā overview
Q4 2022
Statements and reports
05
Risk management
06
Corporate matters
Strategy
02
Solar A/S
CVR no. 15 90 84 16
Statutory Report on
Data Ethics 2022,
cf. Ā§ 99d of the Danish
Financial Statements Act
Solar A/S
CVR no. 15 90 84 16
Statutory Report on
Corporate Governance 2022,
cf. Ā§ 107b of the Danish
Financial Statements Act
Solar A/S
CVR no. 15 90 84 16
Sustainability report
2022
Management review
Solar A/S - Annual Report 2022
3
We have delivered strong results in an ever-changing market.
Earnings improved in all our markets with Solar Sverige and Solar
Nederland showing particularly strong earnings improvement.
Our solid financial performance can largely be attributed to the
commitment of our employees and our Core+ strategy.
For the year under review, revenue totalled DKK 13.9bn, up 12%.
EBITDA amounted to DKK 1,175m, up 29%, which corresponds to a
return on invested capital (ROIC) after tax of 26%. We distributed
DKK 658m to shareholders as dividend.
Our Core+ strategy
All our strategic focus areas have shown progress in 2022:
ā¢ Our Concept share reached 23%
ā¢ Climate & Energy delivered 40% CAGR
ā¢ Industry achieved an overall share of revenue of 33%
ā¢ Trade delivered 17% CAGR
As we embark on the final year of our Core+ strategy, we continue to
see opportunities ahead, and the development of our strategy for the
next period is in process.
Looking ahead to the next strategy period, we are confident that our
four strategic focus areas offer more potential and that we will deliver
an average EBITDA of 6.5% or more in the years ahead.
Driving the green transition
Climate & Energy was characterised by a higher-than-expected
demand for heat pumps and solar panels. This is an area that
continues to offer further opportunities, in particular for our Industry
segment where our products provide a substantial reduction in
Looking ahead to
the next strategy
period, we are
confident that our
four strategic focus
areas offer further
potential.
greenhouse gas emissions and reduce exposure to the rising costs
of energy. All in all, we expect Climate & Energyās positive trend to
extend beyond 2023.
The journey to Net-Zero
Last year we introduced and committed ourselves to the Science
Based Targets initiative (SBTi) by setting targets to reach Net-Zero in
scope 1 & 2 by 2030.
This year we raised our ambitions and submitted our emission
reduction targets for scope 3 to SBTi for validation. Our target is to
reduce our CO2e by 25% compared to 2020 across the value chain by
2030.
Optimising our warehouses
We continue to optimise our business for the benefit of our
customers while, at the same time, reducing our CO2 footprint.
This year, we completed the expansion and further automation of
our Danish warehouse. The installation of one of Scandinaviaās
largest AutoStore systems, which combines digital and green, has
raised Solarās level of digitalisation. Moreover, changing our heat
source to industrial heat pumps and combining them with solar panels
will reduce our emissions by 261 tonnes on an annual basis.
As planned, Solar Nederland will begin the expansion of our Alkmaar
warehouse in 2023. This will add 25% more capacity, 20,000 bins and
four robots to the existing AutoStore system. The heat source will be
converted to industrial heat pumps in combination with solar panels
to ensure a reduction in emissions.
Thank you
Once again, I have been impressed by the high
level of dedication and commitment shown by
our employees during the year and would like
to extend my thanks to them all. They are the
reason for this yearās strong results.
I would also like to thank our customers and
suppliers for their support and cooperation in
2022.
Despite growing global uncertainty and the
challenges this presents, we are well prepared
for 2023.
Letter from the CEO
Jens Andersen
CEO
01
Highlights
4
Management review
Solar A/S - Annual Report 2022
02 Strategy 03 Financial review Sustainability04 Risk management05 Corporate matters06
Fastbox
Year at a glance
124
1,175
Record high
EBITDA
%
A seed for
the future
Launched new
concept within
Climate & Energy
Shareholder-friendly
payout ratio
Warehouse Vejen
expansion completed
EBITDA grew by DKK 264m and we
delivered a record high EBITDA
of DKK 1,175m.
We are transforming the land around our
warehouses into areas of biodiversity. We are
also investing in afforestation measures and
have already acquired 50 hectares of land in
Denmark and plan to acquire more for this
purpose.
In 2022, we introduced two new concepts
ā Solar Zero and Solar Select ā each tailored
to a specific segment. Zero is targeted
at our Climate & Energy customers while
Select is targeted at our Trade customers.
Feedback has been positive, and demand is
strong.
In 2022, we distributed DKK 658m in dividend to our
shareholders, corresponding to a payout ratio of 124%.
The dividend distribution reflects our payout policy of
at least 35% of profit after tax and a gearing ambition
of 1.5-3.0x EBITDA.
Enhanced digitalisation and sustainability were the drivers
behind our warehouse expansion. The result was 11,000
sqm of additional space and the implementation of one
of northern Europeās largest AutoStores. The installation
of heat pumps and solar panels contributed to the 23%
emission reduction in 2022.
25
%
From blue to green
We have raised our climate ambitions and have
submitted our emission reduction targets to
Science Based Targets initiatives (SBTi) for
validation. Our target is to become Net-Zero in
our own operations (scope 1 and 2) by 2030 and
to reduce our CO2e with 25% compared to 2020
in the value chain (scope 3) by 2030.
CO
2
e
DKKm
01
Highlights
5
Management review
Solar A/S - Annual Report 2022
02 Strategy 03 Financial review Sustainability04 Risk management05 Corporate matters06
Highlights
2022
Revenue EBITDA Dividend per share
Finīnciīl
Sustainability
At a record high DKK 1,175m, we succeeded in increasing
EBITDA by DKK 264m compared to 2021. The increase was
supported by positive one-off price effects of approx. DKK
215m (DKK 115m). The EBITDA margin increased to 8.5%
(7.4%).
The Board of Directors will submit a proposal to the Annual
General Meeting for an ordinary dividend payout of DKK 45
per share, corresponding to a total payout ratio of 50%. Our
target for payout ratio is at least 35% of profit after tax.
Adjusted organic growth at group level increased to 12.9%
(5.9%). Although this was supported by price increases, we
continued to see growth in volume. Group revenue rose to
DKK 13.9bn (DKK 12.4bn).
2020 2021
11.5
12.4
13.9
2022
2020 2021
637
911
1,175
2022
2020 2021
43
90
45
2022
Scope 1 & 2 emissions Renewable energy* Energy consumption
Our target is 100% renewable energy* by 2023. With a focus
on switching to certified procured renewable electricity, we
succeeded wih increasing our share by 16 percentage points
compared to 2021.
The energy consumption constituting all of Scope 1 and 2. It
decreased in 2022 among others due to the installation of LED
lighting. Figures for 2020 and 2021 have been recalculated from
kWh to GJ.
Emissions from Scope 1 and 2 have decreased by 23% com-
pared to the 2021, bringing the total emissions down to 5,920
tCO
2
e. This decrease is mainly due to phase out of gas for
heating and installing heat pumps and solar panels.
tCOāe Share in percentage Giga joule (GJ)
7,140
7,690
2020 2021 2022
5,920
2020 2021 2022
28%
%
84
68%
2020 2021
141,074
153,824
146,762
2022
DKKbn DKKm DKK
*Procured certified electricity
01
Highlights
6
Management review
Solar A/S - Annual Report 2022
02 Strategy 03 Financial review Sustainability04 Risk management05 Corporate matters06
Guidance follow-up 2022
Solar upgraded both its revenue
and EBITDA guidance in 2022.
Compared to the initial 2022
guidance, revenue increased by
DKK 1.1bn to DKK 13.9bn and
EBITDA increased by DKK 325m
to DKK 1,175m.
Stronger than expected
EBITDA performance was affected by the following:
Revenue
Strong growth rates for Installation, Industry and Trade
delivered organic growth of 13% compared to our initial
projection of 3%. Climate & Energy performed above
expectations with growth of 87%.
Gross profit margin
Focus on concept sales continued to deliver growth
opportunities. Revenue and margin from concept sales
picked up in all markets, which was supported by the
introduction of Solar Zero and Solar Select.
EBITDA margin
Non-recurring income of DKK 215m had a positive
impact on gross profit margin and corresponded
to an approx. 1.6 percentage points EBITDA margin
improvement compared to our initial guidance.
As expected
Our Better Business project continued to deliver
gross profit margin improvements by supplying the
right products to the right customers and by prudent
product pruning. As a result, revenue was reduced by
approx. DKK 125m.
Expansion and Autostore implementation at our
central warehouse in Vejen, Denmark.
The expansion totalled 11,000 sqm. In addition, we
established one of the largest AutoStore facilities in
Scandinavia with the capacity of 108,000 boxes.
This was carried out successfully with the minimum of
disruption to daily operations.
Less than expected
Cost inflation started to materialise during the latter
part of 2022. Initially, this was mainly within energy
but then spread to more areas.
We launched several initiatives to reduce the impact of
cost inflation.
Despite this, cost inflation is above our initial
expectations.
Organic growth
EBITDA MARGIN
Revenue
EBITDA
Guidance, initial Guidance, initialGuidance, last update Guidance, last update
12,750 313,700 1213,863 12.9
Actual Actual
SOLAR GROUP
DKKm
%
1,175 8.51,170 8.5850 6.7
01
Highlights
7
Management review
Solar A/S - Annual Report 2022
02 Strategy 03 Financial review Sustainability04 Risk management05 Corporate matters06
2023 EBITDA guidance of DKK 900m
Our guidance for 2023 is a
revenue of DKK 13,700m
corresponding to organic growth
of approx. 0%. We expect an
EBITDA of approx. DKK 900m.
General assumptions
Due to the increased geopolitical and macroeconomic
uncertainty (ref. page 28), our market outlook is
characterised by greater uncertainty, particularly for H2.
Cost and wage inflation started to rise during the
latter part of 2022, and we expect this to continue well
into 2023. We have implemented, and will continue to
implement, mitigating measures, which will bring the
expected impact from cost and wage inflation well
below the general price increases.
We expect the global supply chain to continue
normalising in 2023. Climate & Energy is a strategic
focus for Solar and a growing market. However, we do
still see challenges in the supply side of climate and
energy products.
During the last years we have seen substantial price
increases from our suppliers. We expect this to
normalise in 2023. However, Solar has a proven track
record of strong price management.
Our 2023 guidance does not include any significant
restructuring costs.
Market outlook for Solar segments
Overall, we expect markets to be stagnant or negative
in all countries throughout 2023 despite the roll-over
effect from price increases in 2022.
In general, we expect all segments to develop weaker in
H2 than H1 2023.
Installation
In 2023, we expect negative growth for the new
construction sector. The green transition will, however,
continue to deliver strong growth rates.
We expect the installation market to be stagnant or
negative.
Industry
The guidance assumes that sales to Marine and Offshore
will continue to grow, albeit at a slower pace, whereas
we expect all other subsegments to be stagnant or
negative.
Overall, we expect the industry market to be stagnant
Trade
In 2023, we expect minor growth for special sales,
which is the Trade segment's primary activity.
Financial outlook 2023
Revenue guidance
We expect revenue to total DKK 13,700m,
corresponding to organic growth of approx. 0%.
In the wake of substantial price increases in 2022 the
majority of growth for 2023 is projected to take place
in H1.
Adjusted for price increases, mainly roll-over effects
from 2022, we expect negative growth in all main
segments which will only partly be compensated by
the expected strong growth within Climate & Energy.
EBITDA guidance
We expect EBITDA to total approx. DKK 900m which
corresponds to an EBITDA margin of approx. 6.6%.
In 2022, we saw non-recurring income of around DKK
215m due to price effects. We expect this to normalise
in 2023 meaning that no significant amount of one-off
price effects are included in our guidance.
Cost and wage inflation combined with fewer working
days is expected to have a negative impact on EBITDA.
We expect our strategic focus areas ā Concepts, Climate
& Energy, Industry and Trade ā to deliver continuous
improvement in earnings, almost offsetting the cost and
wage inflation.
EBITDA
DKKm
2019
2020
2021*
2022
One-oīs 2022
538
637
911
1175
-215
* including one-oī income od DKK 112m
Inļ¬ation catch-up
Guidance 2023
-60
900
*Including one-off income of DKK 112m
01
Highlights
8
Management review
Solar A/S - Annual Report 2022
02 Strategy 03 Financial review Sustainability04 Risk management05 Corporate matters06
Strategy
Business model
Our strategy
Core+ ambitions
Update of strategic focus areas
Light house, Ć
rhus
When the time came for us to select a supplier for the project, our main priority was Solarās supply
options. Parameters such as flexibility and supply reliability were the deciding factors, as logistics are
extremely important in a major project like Lighthouse, which is Denmarkās tallest building. Weāve been
highly satisfied with our collaboration and with the excellent follow-up after the projectās completion.
Klaus Andersen
Director of department Service & Installation, Wicotec Kirkebjerg
02
9Solar A/S - Annual Report 2022
Strategy
02
Corporate matters06Risk management05Sustainability0403 Financial review01 HighlightsManagement review
Customers &
products
Our customers are active within
the industry, installation and
trade segments.
Electrical
A wide assortment of electrical
components, cables and lighting
solutions. We also provide
training and product guidance.
Climate & energy
Energy-efficient solutions within
heat pumps, solar panels,
ventilation and EV chargers.
Heating & plumbing
Wide assortment of heating &
plumbing components, pipes,
drainage systems, cold-water pumps
and insulation, combined with
training and product guidance.
Solar
More than 200,000 articles are available
from our automated warehouses.
Automa ed warehouses
Based on AutoStore, warehouses
improved productivity and reduced
energy consumption.
Customer services
Supporting customers throughout their
journey makes us stronger together.
FastboxFastbox
Fastbox
FastboxFastbox
t
Bike and EV deliveries
Delivery within the hour
and limited impact on the
environment.
Digital service
67% of customer orders are
made online ā making us one
of the most digitised
companies in our industry.
School
Each year 6,000 participants
attend our Solar School.
Transport
More than 10,000
deliveries every day.
Suppliers
Solar works with around
3,500 suppliers.
Our strong business model supports
our Core+ strategy.
Business model
10
Management review
Solar A/S - Annual Report 2022
Strategy
02
01 Highlights 03 Financial review Sustainability04 Risk management05 Corporate matters06
Our
strategy
Our Core+ strategy builds on our
key differentiating capabilities
in digital sales, category
management and operations,
influenced by the two megatrends,
digital tranformation and green
solutions, that guide over our
strategic focus areas.
Strategic focus areas
Concepts
Grow concept share
across all customer
segments
Industry
Become preferred
supplier to four selected
Industry segments
Climate & Energy
Focus on Climate
& Energy solutions
in all segments
Trade
Grow Trade with focus
on retail, e-tail and
e-trading customers
Dīgītal together
āDigital togetherā is our roadmap for our digital
first approach. It impacts our customers,
business partners, employees and our day-to-day
operations ā as it enables us to work with
greater eīciency and respond faster to
customer needs based on enriched data
and real-time market insights.
Green together
With āgreen togetherā, our ambition is to ensure
a holistic approach to our work with sustainability
ā to strengthen our position as a responsible
business, to provide sustainable solutions for our
customers, and to contribute to a more
sustainable world.
11
Management review
Solar A/S - Annual Report 2022
Strategy
02
01 Highlights 03 Financial review Sustainability04 Risk management05 Corporate matters06
Core+
ambitions
We introduced our Core+ strategy in 2021 and defined
our ambitions towards 2023. Based on the success of
Core+, we have updated a number of our ambitions
accordingly, including the EBITDA margin. From an
EBITDA of DKK 637m in 2020, we posted an EBITDA
of DKK 1,175m in 2022, which corresponds to an
increase of more than 80%.
For updates on individual strategic focus areas and
the environment, social and governance, please see
pages 13-14 and page 23 respectively.
Beyond Core+
The strategy for 2024 - 2026 is being developed
and we expect to launch the strategy in early 2024
together with the Annual Report 2023.
Despite 2023 being the last year for our Core+ strategy,
we are confident that Core+ includes several elements
which offer potential also for the years ahead. We
expect to see a Concept share well above 25% and
double-digit growth in Climate & Energy. In Industry
and Trade, we see continued growth potential. Thus,
we expect to be able to deliver an average EBITDA of
6.5% or more in the years ahead.
Core+ Strategic focus areas
2021-23
Financial & non-financial targets
2021-23
EBITDA margin
ROIC after tax
Concepts
Climate & Energy Industry Trade
Gearing
E-business share
Participants
2,000
Environment, Social & Governance
2021-23
All electricity
will be from
renewable
sources
Install PV
equipment at
all Solar-owned
sites and EV
chargers at
all major
Solar sites
Increase
gender diversity
at management
level
SBTI
commitment*
* Net-zero in scope
1&2 in 2030
(NIBD/EBITDA)
share of revenue
incl. MAG45
CAGR for
2021-23
share of revenue
incl. MAG45
CAGR for
2021-23
to complete training in renewable
solutions at Solar School in 2021-23
>6.5
>
25
>
40 35
>
15
20 701.5-3.0x
%
% % % %
% %
12
Management review
Solar A/S - Annual Report 2022
Strategy
02
01 Highlights 03 Financial review Sustainability04 Risk management05 Corporate matters06
Concepts
As 2022 successfully delivered a concept share of 23% of
revenue, we remain firmly on track. This positive development not
only affirms our ambition to grow our EBITDA margin, but also
supports our customers in their efforts to become more efficient
and profitable.
Our concepts have enabled us to substitute low margin products with
concept alternatives. The resulting changes in customer patterns of
behaviour have improved our gross profit margin and reduced costs for our
customers ā a win/win situation.
Following on from this success, we have launched two more concepts
known as Zero and Select. Solar Zero includes a range of high-quality
climate and energy products with high availability, reasonable prices and
technical support. Solar Select targets our Trade customers and both
concepts have been well received.
We have aligned and expanded our product portfolio within each concept
across borders, which ensures that our customers can be assured of an
alternative solution.
Climate & Energy
Climate & Energy delivered a growth level that exceeded our initial
expectations. Growth has been driven by an increased demand for
sustainable energy measures, particularly heat pumps and solar
panels. We expect the uplift in demand to continue.
We extended our organisational scope in Sweden, Norway and the
Netherlands through the extension of our category management
and sourcing. The aim is to strengthen local market knowledge and
consolidate our product portfolio across markets.
With the installation of high-capacity heat pumps and solar panels at
our warehouse in Denmark, we are ready to showcase a solution that will
provide the industry segment with more energy efficient measures that
support a reduction in emissions.
We have trained our employees in sustainable construction, which means
that our customers benefit from their expertise in matters relating to
certified sustainable construction.
Based on these positive developments, we have increased the strategic
target for Climate & Energy accordingly. We are now expecting >40% CAGR
for the strategic period.
Progress
of Core+
strategy
Our Core+ strategy has performed
well, driven by targeted initiatives
that underpin our ambitions.
Our financial ambitionsOur financial ambitions
4023 5 4025
> >>
%% % %%
TodayToday Previous Ambitions 2023 Ambitions2023 Ambitions
CAGRRevenue CAGR CAGRRevenue
Update of strategic focus areas
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Management review
Solar A/S - Annual Report 2022
Strategy
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01 Highlights 03 Financial review Sustainability04 Risk management05 Corporate matters06
Our financial ambitionsOur financial ambitions
Industry
Two years into our Core+ strategy, we remain on track to deliver a
35% share of revenue. We have seen strong performances across our
four industry sub-segments and see further opportunities ahead by
providing our industry customers with sustainable solutions.
Our transition to a cross-border, vertical organisational structure, covering
Denmark, Norway, Sweden and the Netherlands, was the most significant
change within this focus area during the year under review.
We leveraged our knowledge and know-how from our Marine & Offshore
business in Norway and expanded the business to the Netherlands where
we have got off to a good start.
We extended an important infrastructure contract with a long-standing
customer in Norway.
In Sweden, we have benefitted from increased market demand and added
new customers in two sub-segments - MRO and OEM. Our new customers are
attracted by our strong position within the automated product category.
For all sub-segments, digitalisation continues to drive further integration
between our customersā Enterprise Resource Planning (ERP) system and
our trading platform, thus providing them with greater understanding of
their spend and product requirements.
Trade
Tradeās ability to develop new customer and market opportunities
will ensure that we remain on track to deliver on the strategic
ambition of growing by more than 7.5% CAGR.
Trade has now been launched in the Swedish and Norwegian markets, which
means that it covers all our major markets. The focus area has thus been
reorganised and we have established a cross-market organisation, which
reflects the various segments that we serve.
We continue to expand our business opportunities both within the current
business segments but also by introducing new ones. With the introduction
of the new B2B MRO segment, we now serve hotels, fitness centres, housing
associations etc. Such customers would not have been a match for the
Installation or Industry segments.
We are seeing a rise in demand for sustainable solutions, particularly
driven by heat pumps and lighting optimisation. Based on these positive
developments, we have increased the strategic target for Trade accordingly.
We are now expecting >15% CAGR for the strategic period.
33 7.5 1535
% %
Today Previous Ambitions 2023 Ambitions2023 Ambitions
Revenue CAGR CAGRRevenue
Update of strategic focus areas
> >>
% %
17
%
Today
CAGR
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Management review
Solar A/S - Annual Report 2022
Strategy
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01 Highlights 03 Financial review Sustainability04 Risk management05 Corporate matters06
Ćstre Landsret, Denmark
Whenever SIF Group is involved in major projects such as the Court of Appeal of Eastern
Denmark, itās important that weāre supported by professional partners like Solar, who can
advise and guide us on the right products and play an active role over the project period. In
this way, we ensure that the solutions we have chosen work as intended.
Christian Eriksen
Contract Manager, SIF Gruppen
Finīnciīl review
5-year summary
Financial review
Segments
03
15Solar A/S - Annual Report 2022
Financial review
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Corporate matters06Risk management05Sustainability0402 Strategy01 HighlightsManagement review
Five-year
summary
In all material aspects financial ratios are calculated in accordance with the Danish Finance Societyās
āRecommendations & Financial Ratiosā.
As at 1 January 2019, Solar implemented IFRS 16, Leases, by applying the modified retrospective approach.
Comparative figures are not restated. This especially affects EBITDA, interest-bearing liabilities, EBITDA margin,
gearing and equity ratio.
ESG ratios are calculated in line with the accounting principles included in our Sustainability Report 2022. Solar
has applied Nasdaq/FSR/CFA key figures since 2020.
Consolidated (DKK million) 2022 2021 2020 2019 2018
Revenue 13,863 12,354 11,465 11,679 11,098
Earnings before interest, tax, depreciation and
amortisation (EBITDA)
1,175 911 637 538 379
Earnings before interest, tax and amortisation (EBITA) 978 727 455 360 327
Earnings before interest and tax (EBIT) 909 672 248 260 224
Earnings before tax (EBT) 858 622 300 120 237
Net profit for the year 660 531 222 64 133
Balance sheet total 5,901 5,305 4,607 4,990 4,633
Equity 1,931 1,952 1,696 1,592 1,638
Interest-bearing liabilities, net 1,074 -37 128 921 461
Cash flow from operating activities 16 783 813 300 224
Net investments in property, plant and equipment -167 -125 -25 -110 -59
Financial ratios (% unless otherwise stated)
Organic growth adjusted for number of working days 12.9 5.9 -2.0 4.9 2.2
Gross profit margin 23.4 22.4 21.0 20.1 20.2
EBITDA margin 8.5 7.4 5.6 4.6 3.4
EBITA margin 7.1 5.9 4.0 3.1 2.9
Effective tax rate 23.1 14.6 26.0 45.2 23.3
Net working capital (year-end NWC)/revenue (LTM) 15.9 10.2 9.7 11.0 9.8
Gearing (net interest-bearing liabilities/EBITDA),
no. of times
0.9 0.0 0.2 1.7 1.2
Return on equity (ROE) 34.0 29.1 13.5 4.0 8.2
Return on invested capital (ROIC) 25.5 24.6 13.8 8.3 8.1
Equity ratio 32.7 36.8 36.8 31.9 35.4
Share ratios (DKK unless otherwise stated)
Earnings per share outstanding (EPS) 90.37 72.72 30.42 8.77 18.22
Ordinary dividend per share 45.00 45.00 28.00 14.00 14.00
Extraordinary dividend per share - 45.00 15.00 - -
Total dividend in % of net profit for the year (payout ratio) 49.8 123.8 141.1 159.4 76.7
Employees 2022 2021 2020 2019 2018
Average number of employees (FTEs) 3.019 2.908 2.935 3.039 2.941
ESG ratios (Solar Group ratios unless otherwise stated)
CO2e, scope 1 (tons) 3,033 3,583 2,814
CO2e, scope 2 (tons) 2,887 4,107 4,326
Renewable energy share (%) 84.0 68.0 28.0
Gender diversity board (%) 33.0 17.0 17.0
Gender diversity (%) 29.0 27.0 27.0
Gender diversity management, Danish activities (%) 17.0 19.0 17.0
Gender pay ratio (no. of times) 1.21 1.17 1.14
Days/FTE sickness absence 12.2 10.3 9.2
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Financial review
Record high EBITDA of DKK 1,175m
In 2022, we achieved a record high
EBITDA of DKK 1,175m (DKK 911m)
which slightly exceeded our latest
guidance. Adjusted organic growth
increased to 12.9% (5.9%) and gross
profit margin increased to 23.4%
(22.4%) supported by one-off price
increases.
(Data shown in brackets relate to 2021 figures)
Revenue
Adjusted organic growth at group level increased to
12.9% (5.9%) and revenue rose to DKK 13.9bn (DKK
12.4bn). Although growth was supported by price
increases, we continued to see growth in volume.
One of our strategic focus areas, Climate & Energy,
delivered revenue of DKK 1.3bn, which corresponds to
adjusted organic growth of 81%.
Gross profit
Gross profit increased by DKK 472m with continuous
improvement in the gross profit margin, which
increased to 23.4% (22.4%).
One-off price effects resulted in a positive impact of
approx. DKK 215m (DKK 115m) on gross profit. This
corresponds to an improved gross profit margin of
approx. 1.6 percentage points (0.9 percentage points).
Other income
In Q4, Solar Nederland signed an agreement
concerning the sale of its warehouse located in
Duiven. Finalisation of the transaction and transfer
of the property to the purchaser is subject to the
usual conditions, including vacating the building and
clearing the premises. This is expected before the
end of Q1 2024. The financial impact from the sale
is an expected capital gain of approx. DKK 35m that
will be recognised in the income statement when the
transaction is finalised.
External operating costs and staff costs
In total, external operating costs and staff costs were
down at 14.7% (15.0%) of revenue.
Rising prices, including energy prices, had a negative
effect on cost development. Increased costs were also
driven by strong performance.
EBITDA
EBITDA increased by DKK 264m to DKK 1,175m, which
corresponds to an EBITDA margin of 8.5% (7.4%) of
revenue. All markets saw substantial improvement in
EBITDA, with Solar Nederland and Solar Sverige making
a significant contribution.
The results from the individual segments and markets
are shown on pages 54-55.
Financials
Net financials amounted to DKK -50m (DKK -48m)
negatively affected by DKK 20m due to fair value
adjustments.
In 2021, net financials were negatively affected by
DKK 14m due to the early redemption of an interest
swap and positively affected by DKK 13m from interest
Organic growth
Gross profit margin
EBITDA margin
%
2021
5.9%
12.9
2022
2021 2022
22.4%
23.4
%
2021
7.4%
8.5
2022
%
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Financial review
compensation related to a ruling by the Danish tax
authorities. In addition, net financials were negatively
affected by DKK 23m due to fair value adjustments.
Adjusted for these items, net financials totalled DKK
-30m (DKK -24m).
Earnings before tax
Earnings before tax were up at DKK 858m (DKK
622m).
Income tax
Income tax amounted to DKK -198m (DKK -91m). The
posted income tax corresponds to an effective tax rate
of 23.1% (14.6%).
In 2021, we received a ruling from the Danish tax
authorities, which approved a reduction in Danish
taxable income in 2012. This resulted in a tax income
of approx. DKK 19m. In addition, tax loss carried
forward amounting to DKK 32m was capitalised due to
the improved performance in both MAG45 and Solar
Nederland. Adjusted for the above-mentioned tax value
of loss regarding previous years and the change in the
non-capitalised loss in subsidiaries, the effective tax rate
was 22.4% in 2021.
Net profit
Net profit increased to DKK 660m (DKK 531m).
Cash flows
Net working capital calculated as an average of the
previous four quarters amounted to 14.5% (11.0%) of
revenue. Net working capital at the end of 2022 was
15.9% (10.2%).
Cash flow from operating activities totalled DKK 16m
(DKK 783m).
Changes in receivables had a DKK -394m (DKK -229m)
impact on cash flow, which was affected by the
increased growth level in 2022.
Changes in inventories and non-interest-bearing
liabilities had an impact of DKK -433m (DKK -319m)
and DKK -131m (DKK 517m) respectively. The general
inventory level was affected by price increases and by
the decision to increase our inventory level to ensure
delivery performance during a period of potential goods
shortage. Part of the inventory increase also supports
the successful performance of our strategic focus area,
Climate & Energy, particularly in Solar Nederland.
Total cash flow from investing activities amounted
to DKK -259m (DKK -191m). DKK -128m relates to the
investment in the expansion and upgrade of our
warehouse in Denmark. In addition, the acquisition of
HĆøjager Belysning A/S had an impact of DKK -34m, cf.
page 88 of this report.
Cash flow from financing activities amounted to DKK
-82m (DKK -515m), mainly affected by ordinary and
extraordinary dividend distributions totalling DKK 658m
(DKK 314m) and by the change in current interest-
bearing debt of DKK 519m (DKK -9m).
Consequently, cash flow totalled DKK -325m (DKK
77m).
Net interest-bearing liabilities amounted to DKK
1,074m (DKK -37m).
At the end of 2022, gearing was 0.9 (0.0) times
EBITDA. If adjusted for one-off impact, gearing
amounted to 1.1 times EBITDA. Our gearing target is
between 1.5-3.0 times EBITDA. The Board of Directors
continually assesses the capital structure in relation to
our target and our capital requirements.
At the end of 2022, Solar had undrawn credit facilities of
DKK 710m.
Invested capital
Invested capital for the Solar Group totalled DKK 2,978m
(DKK 1,866m). ROIC amounted to 25.5%
(24.6%). Activities with a Solar equity interest of less
than 50% are not included in the ROIC calculation.
Invested capital only includes operating assets and
liabilities.
Remuneration of Executive Board
and management team
In accordance with Solarās remuneration policy and
general guidelines for incentive-based remuneration,
the Board of Directors granted restricted shares to the
Executive Board and management team in February
2022.
11,110 (13,037) restricted shares were granted,
amounting to a fair value of DKK 8.0m (DKK 5.9m)
at the time of granting. The restricted shares vest
three years after the time of granting, i.e. this grant
of shares vests in 2025 (2024). In February 2022, 7,479
(3,443) share options from the grant in 2019 (2018) were
exercised either by converting the options to shares or
settled in cash. For more information, please see this
reportās note 5.1 on share-based payment.
General information on Solarās incentive scheme is
available on our website:
www.solar.eu/investor/policies
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Rental
Special
handling
Inventory
management
EV
Chargers
Logistic
handling
Data and
security
Heating
& plumbing
Renewable
energy
Lighting
Cable
Electrical
material
SegmentsSegments
Installation
Todayās installers require more than a product
Our 20,000 plus installation customers range from sole installation contrac-
tors to large installation companies. Irrespective of their size, they all value
our expertise and extensive range, which covers electrical, heating & plumb-
ing installations as well as climate & energy products.
Installation revenue increased to DKK 8,013m (DKK 7,399m), which corre-
sponds to overall adjusted organic growth of around 9.6% (3%) and relates
primarily to the electrical business. All main markets saw growth in Installa-
tion, with Solar Norge posting double-digit growth.
Segment profit* increased to DKK 1,021m (DKK 814m). This corresponds to
a segment profit margin of 12.7% (11.0%), which was positively affected by
increased gross profit margin.
Detailed segment information is given on pages 54-55.
(Data shown in brackets relate to 2021)
2022 Segment revenue
DKKm
DKKm
2022 Segment profit
Installation
Installation
Industry
Industry
Trade
Trade
8,013
1,021
4,543
811
1,307
174
* Segment profit does not include non-allocated costs, which cover income
and costs related to joint group functions and to costs which cannot be
reliably allocated to the individual segment.
Ventilation
Services
Products
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Sustainability04 Risk management05 Corporate matters0602 Strategy01 Highlights
SegmentsSegments
Industry
Creating value for our Industry customers
Our 20,000 plus Industry customers cover the following sub-segments: OEM
(Original Equipment Manufacturer), MRO (Maintenance, Repair & Opera-
tions), Infrastructure and Offshore & Marine. They all share one common
factor: they rely on our insight and ability to deliver the right products at
the right time.
Industry revenue increased to DKK 4,543m (DKK 3,920m). This corresponds
to overall adjusted organic growth of around 16.6% (8.8%) related primarily
to Offshore & Marine, but also to OEM. We posted growth above 13% in all
markets covering Industry, with Solar Norge delivering very solid growth
rates.
Segment profit* increased to DKK 811m (DKK 635m). This corresponds to a
segment profit margin of 17.9% (16.2%).
Detailed segment information is given on pages 54-55.
Services
Products
Heating
& plumbing
Lighting
Tools Cable Ventilation
Renewable
energy
Data and
security
EV
chargers
Inventory
management
Special
handling
Logistic
solutions
Electrical
material
(Data shown in brackets relate to 2021)
2022 Segment revenue
DKKm
DKKm
2022 Segment profit
Installation
Installation
Industry
Industry
Trade
Trade
8,013
1,021
4,543
811
1,307
174
* Segment profit does not include non-allocated costs, which cover income
and costs related to joint group functions and to costs which cannot be
reliably allocated to the individual segment.
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Sustainability04 Risk management05 Corporate matters0602 Strategy01 Highlights
HOTEL
Renewable
energy
Lighting Cable
Office &
canteen
articles
Heating
and
plumbing
Special
handling
Inventory
management
Solar
school
Ventilation
Logistics
solutions
Electricial
material
Data and
security
EV
chargers
Toilet &
cleaning
articles
Tools
SegmentsSegments
Trade
Dedicated local teams support Trade customers with
specialised services
The requirements and buying preferences of our 8,000 trade customers
differ from our Installation and Industry segments. Each of our segments
comprises unique services. For Trade, these include storage solutions, logis-
tics and shelf cleaning in DIY shops. These are services and solutions that
support our Trade customers in their daily business and allow them
to focus on what they do best. We prioritise the ongoing development of
our Trade services by engaging with our customers.
Revenue from Trade increased to DKK 1,307m (DKK 1,035m), which corre-
sponds to unchanged overall adjusted organic growth of 23% (17%).
Segment profit* amounted to DKK 174m (DKK 183m), which corresponds to
a segment profit margin of 13.3% (17.7%).
Detailed segment information is given on pages 54-55.
(Data shown in brackets relate to 2021)
2022 Segment revenue
DKKm
DKKm
2022 Segment profit
Installation
Installation
Industry
Industry
Trade
Trade
8,013
1,021
4,543
811
1,307
174
* Segment profit does not include non-allocated costs, which cover income
and costs related to joint group functions and to costs which cannot be
reliably allocated to the individual segment.
Services
Products
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Sustainability04 Risk management05 Corporate matters0602 Strategy01 Highlights
Hurtigruten, Norway
Solar is an important supplier and helps to ensure the daily operations of our coastal ferry service.
The company has proved to be a stable and reliable partner, and if new challenges arise, Solar is always on
hand to provide a solution. Fast, efficient and accommodating service is the essence of our partnership.
Kristian Solberg Balassanian
Hurtigruten Norge
Sustainability
Sustainability highlights
Climate & energy solutions
04
22Solar A/S - Annual Report 2022
Sustainability
04
Corporate matters06Risk management05Financial review0302 Strategy01 HighlightsManagement review
Environmental,
social &
governance
Our Sustainability Report 2022 is an extension of the management review
and is prepared in compliance with sections 99a, 99b and 107d of the Dan-
ish Financial Statements Act. For further information please see
We remain on track to deliver on both
our short-term and long-term ambition
Leading with transparency
We see governance as a valuable tool for exercising sound management
and ensuring transparency for shareholders and other stakeholders.
Responsible use of resources
Solar seeks to reduce environmental impacts and promote
sustainable solutions via our product and service portfolio.
Because we care
We seek to ensure safe working conditions for our employees and
respect human rights in our operations as well as in our business
relations.
98% (98)
Board meeting attendance rate
27times (28)
CEO pay ratio
1
3,033
tons
(3,583)
CO
2
e, scope 1
2,887tons
(4,107)
CO
2
e, scope 2
3,019 FTEs
(2,908)
Full-time workforce
17%
(19)
Gender diversity
management
3
12.8%
(7.8)
Employee
turnover rate
2
12.2
(10.3)
days/FTE Sickness
absence
29%
(27)
Gender diversity
33% (17)
Gender diversity board
Our Scope 1 & 2 year-over-year emissions were reduced by 15.4%
and 29.7%, respectively. This supports our ambition of reaching
Net-Zero by 2030. In addition, we wish to raise our ambition
further and submitted a 25% Scope 3 emission reduction by 2030
to SBTi for validation, compared to 2020.
The Scope 1 & 2 emission decrease was supported by an increase
in use of renewable electricity, which increased by 16 percentage
points and reached 84%. By installing more than 2,700 solar panels
at our head office in Vejen, we have increased the share of self-
generated electricity.
We installed EV chargers at all our major sites. This reflects our
journey towards electrifying our company car fleet.
Gender diversity within our management level decreased by two
percentage points. The calculation method changed in 2022. If
recalculated according to previous calculation method, the share
would remain unchanged.
1) If measured against Danish employees, the CEO pay ratio amounts to 23 times (2021: 23 times).
2) The calculation method is changed to include all employee turnover, where 2021 figure only included voluntary employee turnover.
3) The calculation method changed in 2022 to cover Danish activities only.
1.21times
(1.17)
Gender pay ratio
146,762GJ
(153,824)
Energy consumption
84
% (68)
Renewable energy share,
procured certified electricity
20,751
m
3
(23,204)
Water consumption
E
n
v
i
r
o
n
m
e
n
t
a
l
G
o
v
e
r
n
a
n
c
e
S
o
c
i
a
l
ESG performance
www.solar.eu/our-company/sustainability
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Sustainability
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Financial review03 Risk management05 Corporate matters0602 Strategy01 Highlights
Climate & energy solutions
Climate and energy is a growing
market driven by an increased
demand for sustainable energy
solutions, particularly heat pumps
and solar panels.
We have extended our organisational scope in Sweden,
Norway and the Netherlands through the extension of
our category management and sourcing. The aim is to
further strengthen local market knowledge and
consolidate our product portfolio across markets.
Heat pumps
We are seeing a huge interest from both businesses and
private individuals in reducing emissions and operating
costs as well as ensuring energy supplies.
As regards high-capacity industrial heat pump
installations, we offer turnkey solutions and a single
point of contact. This comprises everything from
product selection, planning and design, regulatory
aspects and assistance with installation. Therefore, our
customers are ensured the appropriate installation for
their requirements.
Solar panels
Renewable energy and own generated energy is a
growing market which is driven by customers
embarking on a green transition who require safety of
supply and a sound financial solution. Our suppliers
have signed our code of conduct and with the launch of
the EcoVadis risk management platform, we will
continue to monitor their ethical approach to business.
With the installation of high-capacity heat pumps and
solar panels at our warehouse in Denmark, we are ready
to offer the industry segment a solution entailing
emission reductions.
EV chargers
We aim to deliver energy-efficient and innovative
best-in-class EV charger solutions to help end-users save
energy in an intelligent and cost-effective way. In 2022,
we established a partnership with Smappee, a Belgian
supplier of EV chargers and smart charging solutions for
domestic use. It ensures that a vehicle is charged when
energy is cheapest or when consumption is low.
Moreover, if the system is connected to a solar panel
installation, it will evaluate whether the renewable
energy should be used for the vehicle, the household or
simply returned to the grid.
Solar Zero
We are continuously expanding our product range and
in 2022, we launched Solar Zero. This is a quality
portfolio of products within the field of Climate and
Renewable Energy aimed at achieving best-in-class
transparency and responsibility. The catalogue of
products focuses on convenience, logistics and
availability, which will make it easier for our customers
to select the right solution for their next green project.
Solar Zero comprises products within the following
categories: heat pumps, solar panels, ventilation and EV
chargers. In 2023, we expect to grow our assortment
even further.
Theme about energy efficiency
In the autumn, we put additional focus on the green
transition to enable our customers to embark on their
own green transition and begin an energy-saving
solutions dialogue with their customers. To this end, we
launched an awareness campaign across borders and
segments. The campaign presented solutions to assist
customers in their green transition based on three areas
ā products, services and training.
Heat pump vs gas boiler
A gas boiler produces an average of 1
kWh of heat per 1 kWh of input energy
whereas a heat pump produces approx.
3.5 times as much heat per 1 kWh of
input energy. By switching to a heat
pump, therefore, emissions are
reduced accordingly.
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Circularity
We support the transition to a circular economy.
Together with five pump manufacturers and four
industry peers, our Dutch subsidiary has launched
Circopomp. This initiative is aimed at collecting old
circulator pumps and then giving them a second life.
Approx. 830,000 new circulator pumps are replaced in
the Dutch market every year with approx. 1,900,000 kilos
of obsolete pumps ending up as scrap.
The pumps can be handed in at our customer centres.
Similar circular economy projects are up and running in
other countries but on a smaller scale and we foresee
growth in this area in years to come.
Lights and new regulations
With the decision to ban import and production of
fluorescent lamps containing mercury according to the
RoHS directive 2011/65/EU, we have taken measures to
help our customers through this change. Products and
solutions replacing the fluorescent lamps are already
available and a website containing relevant information
was launched. In Q1 2023, we plan to host a number of
information meetings and webinars targeting our
installation customers.
We expect the increase in demand for climate and
energy products and solutions to persist. We
acknowledge that an imbalance may arise in supply and
demand due to external circumstances.
Climate & energy solutions
Upgrading to LED lighting
We have changed our old lighting to
LED lighting in our Copenhagen office
reducing our emissions with 57%
per year.
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Solar A/S - Annual Report 2022
Risk management
Risk management
Group risks and mitigation
05
Solar has a highly competent team. They solve our problems quickly and efficiently, and are always alert
to ways of enhancing our relationship. We have established a win-win procurement partnership whereby
Solar achieves higher sales and our administrative tasks are reduced.
Steffen Stenbak Christiansen
Chief Engineer & Electrician, Saeby Fiske-Industri
26Solar A/S - Annual Report 2022
Risk management
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Management review 01 Highlights 02 Strategy Financial review03 Sustainability04 Corporate matters06
Risk management
The Executive Board is responsible for ensuring that
the necessary policies and procedures are in place,
that efficient risk management systems have been
established for all relevant areas and are improved
continuously. The overall purpose of risk management is
to support a robust business that is able to react quickly
and flexibly when conditions change.
Solarās risk management encompasses the
relevant entities in Denmark, Norway, Sweden,
the Netherlands, Poland, and MAG45. The process
supports local management teams by taking a
structured approach towards risk management, with
risk self-assessments anchored in an annual cycle.
Data is consolidated at group level, and the findings are
presented to the Board of Directors for approval.
The individual risk owners are responsible for mitigating
risks to a level within Solarās risk appetite and tolerance.
Throughout the year, Solarās Group Risk Management
and local risk managers actively monitor the progress of
the mitigation to ensure that risks are at the acceptable
level.
Three lines of defence
Solarās risk management is organised
according to the three lines of defence
model which demonstrates and structures
roles, responsibilities for risks, decision-
making and control to achieve effective
governance.
Solarās risk management is based
on Enterprise Risk Management
(ERM) and the Board of Directorsā
rules of procedure, which place the
responsibility for risk management
with the Executive Board.
First line of defence
Executive Board
Board of Directors / Audit Committee
Approve and accept risk policy including
risk appetite and tolerance
Monitor the risk management framework and effectiveness
Second line of defence Third line of defence
Business Management
& Risk Owners
Group Risk Management
& Risk Managers
Internal Audit
Own risks and risk
management activities
Establish policies and
frameworks, facilitate
risk identification and
monitoring
Test, validate and
assess efficiency in risk
management processes
and activities
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Risk definition
The focus of Solarās risk management is to identify
and assess operational risks and operational aspects
of strategic risks throughout the Solar Group. Solar
defines these risks as events or developments that could
significantly reduce Solarās ability to:
1. Meet profit expectations,
2. Execute the strategy, and/or
3. Maintain a licence to operate.
Solar works with the concepts of gross risk (inherent
risk) and net risk (residual risk).
The gross risk effect is defined as the product of the
impact and the probability of the risk materialising
without any change to current risk mitigation.
The net risk effect is defined as the risk level when
considering current as well as planned mitigation
activities with regard to both impact and probability.
Risk appetite and tolerance
Solarās risk appetite and risk tolerance articulate the
extent to which Solar is willing to accept risks in three
overarching categories: Governance & Compliance,
Strategy & Planning, and Operations & Infrastructure.
Accordingly, the risk appetite outlines Solarās strategic
outlook towards risk and defines the degree to which
Solar is risk-seeking or risk-avoiding, while the risk
tolerance, as an indicative parameter, outlines the
level of net risk that Solar is willing to accept for a given
measure of reward.
Risk appetite and risk tolerance are set by the Board
of Directors and are reviewed annually.
Risk self-assessment
Solar evaluates the effect of a risk based on the product
of the probability of the risk materialising and the
gross impact if the risk does materialise. In detail,
the probability of the risk is defined as the expected
frequency of the risk occuring, while the impact is
divided into four dimensions:
1. Effect on earnings
2. Reputational damage
3. Compliance (licence to operate)
4. Business activities
Risk handling
The purpose of identifying and then handling risk is to
reduce it to an acceptable level, which is in line with
risk appetite and tolerance. In Solar, we work with four
different risk treatment strategies when handling risks.
ā¢ Avoid ā seeks to eliminate uncertainty by changing
circumstances.
ā¢ Transfer ā seeks to transfer ownership of and/or
liability for the risk to a third party.
ā¢ Accept ā recognises net risks and monitors risk
exposure.
ā¢ Mitigate ā seeks to minimise risk exposure to below
the acceptable threshold.
To ensure an understanding of the philosophy and
the risk management preferences, Solar provides
structured criteria for risk attitude and a catalogue
of mitigating activities.
Solar Risk Map
Solarās top risks are mapped out in
terms of probability and impact in
the risk map.
Risk appetite and tolerance per risk category
A
B
C
D
E
F
G
Cyberattack
IT interruptions
Global supply chain
Geopolitical and macroeconomic uncertainty
Credit management
New entrants in the market
Central warehouse breakdown
High
Impact
Probabīlīty
High
Low
Low
A
G
B
F
D
C
E
Low Medium High
Risk seeking
Risk tolerantRisk neutral
Risk Appetite
Risk Tolerance
Risk Category
Moderately
Risk Averse
Risk averse
Governance and
compliance
Strategy
and planning
Operations and
infrastructure
Low
Low-medium
Low-medium
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One of the risks reported last year, 'Warehouse
operations', has been significantly reduced by means
of extensive contingency plans, scenario analyses and
the past experience of handling the pandemic fallout.
Moreover, as COVID-19 is no longer regarded as a major
threat in Europe, the risk is no longer prioritised at
group level.
Additionally, the risk of talent management from last
year has been minimised to an acceptable level thanks
to the ongoing initiatives led by HR.
The emerging risks relating to sustainability have been
included in interviews and local risk assessments.
However, the consolidated risk score has not yet
triggered greater attention at group level, although
the associated risks are still monitored closely.
Exposure to
potential top
risks and
mitigation
Cyberattack IT interruption
A B
The risk is unchanged.
Risk of IT breakdown and/or data breach due to a cyberattack.
Business interruptions in the form of compromised data, denial of
service, intellectual property theft, and regulatory investigations
are among the consequences of various cyber incidents and
would ultimately lead to financial losses and an inability to run
daily operations. The probability of the worst-case scenario is
slightly above medium, and the potential impact is assessed as
between medium and high.
Mitigation measures focus on strengthening cyber resilience.
This includes 24-hour monitoring of the network for unusual
behaviour as well as ensuring relevant solutions or upgrading
existing ones. Using the advanced security analytics tool
supports the evaluation of the organisation's security measures
and implementation of recommended activities. The disaster
recovery tests provide assurance that the companyās 'crown
jewels' (the most critical systems) can be restored within an
acceptable timeline in case of a successful cyberattack. Solar runs
a structured disaster simulation to test business continuity plans
and scenario analyses to identify potential improvement areas.
Additionally, Group IT continues to communicate appropriate
internal information and deliver e-learnings on IT security to
maintain organisational awareness and reduce the likelihood of an
unwanted event caused by the human factor. As external threats
continue to increase, the risk is assessed as unchanged despite a
number of mitigating measures.
The risk is unchanged.
Risk of business interruption due to unforeseen but inherent
events affecting IT operations such as fire, power outage,
network, or system failure, and other natural or unintentional
man-made hazards.
Potential IT interruption may have a significant impact on
earnings and reputation depending on the nature and scale of
the event. However, the probability of the worst-case scenario is
between low and medium, but the potential impact is assessed as
between medium and high.
The IT area is continuously monitored and evaluated. Business-
critical applications are mirrored at two central data centres
in order to safeguard IT operations so that the business can
continue to run if one centre experiences downtime. Preventive
measures planned to reduce the impact of cyberattacks ā such
as improving network security, improving application robustness,
or strengthening and testing business continuity plans ā will also
reduce the risk of losing stable digital operations.
Risk
Scenario
Impact
Mitigation
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The riskās impact is unchanged, but its probability has
decreased slightly.
Risk of stock being unavailable due to a global supply chain
disruption and/or potential price volatility.
Inability to meet customer demand and maintain acceptable
delivery services can jeopardise customer relationships and
ultimately affect business results. The probability of the risk as
well as its impact are considered medium.
Solar continues to implement measures aimed at minimising the
risk of a zero stock situation occurring. Ensuring an adequate
inventory and increasing the purchase of materials that are
at high risk are natural mitigation measures that have already
been undertaken. Increasing the conversion to concept products
would also improve product availability. Solar maintains a dialogue
with major suppliers regarding their supply chain. Additionally,
a review of alternative suppliers is taking place to minimise
negative consequences should a disruption affect a certain
country or supplier. A dedicated cross-functional team shares
market information and continuously reviews risk indicators to
identify early warnings. Improving the order placement process,
monitoring average delays in delivery, and improving forecasts
on material levels help to avoid a shortage of critical products in
warehouses.
The risk has been added to the list of top group risks this year.
Risk of adverse market conditions or a change to industry trends
due to geopolitical and macroeconomic uncertainties.
Geopolitical tensions as well as a wide range of macroeconomic
factors (incl. increasing inflation, interest rates, energy costs) may
adversely impact markets and reduce demand.
Solar has drawn up the appropriate risk indicators and
mitigation measures for specific parts of the business. These are
monitored on a regular basis in anticipation of an event requiring
a rapid response. Strong focus on selling the right products (i.e.
climate & energy) and growing the concept share are measures
designed to achieve the projected results. With a view to a
potential escalation of political tensions, Solar has incorporated a
military conflict or a hybrid attack into its disaster management
framework. Potential triggers have been identified, and scenarios
and emergency strategies have been defined in the event of a
conflict affecting the countries in which we operate.
The risk is unchanged.
Risk of negative financial consequences of extending credit to
customers.
Extending credit to customers is regarded as a natural
and important element in Solar's business operations. If a
negative market cycle occurs, then the credit risk increases.
The challenging macroeconomic conditions, in particular the
continuing rise in inflation and interest rates, may raise the
likelihood of the risk. The probability and potential impact of the
worst-case scenario is assessed as close to medium.
Solar conducts efficient credit management at all times and
monitors the development of credit risk. Furthermore, we have
taken out insurance to hedge against potential losses on trade
receivables. In addition, uninsured trade receivables are generally
spread across a large number of small customers. The impact
of current market volatility has been a contributing factor in
maintaining the risk at the same level as last year.
Risk
Scenario
Impact
Mitigation
Global supply chain Credit management
Geopolitical and
macroeconomic uncertainty
C D E
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Central warehouse
breakdown
The risk is unchanged.
Risk of business interruption at the central warehouses due
to unforeseen but inherent events such as fire, power outage,
flooding, and other natural or man-made hazards.
Potential interruption of the operations of central warehouses
may have a significant impact on earnings and reputation
depending on the nature and scale of the event. However, the
probability of the worst-case scenario is low, but the potential
impact is assessed as between medium and high.
A contingency plan has been updated at all central warehouses.
It clarifies roles and responsibilities and describes actions
required from staff in case of possible force majeure events. Solar
arranges for regular warehouse audits in order to verify the level
of preventive and detectable security measures to protect its
facilities. Thanks to the implementation of the automated storage
and retrieval systems in Denmark, Norway and the Netherlands,
the risk of a man-made hazard is limited.
Risk
Scenario
Impact
Mitigation
The risk is unchanged.
The risk of new market players entering the market and giving
rise to increased competition and/or price pressure with a
negative impact on Solarās business.
The current commercial risk of strong new entrants or
acquisitions in the market may result in reduced competitiveness,
lost revenue, and decreased earnings. The probability of the
worst-case scenario is assessed as close to medium with the
potential impact assessed as between low and medium.
Solar seeks to engage in an active and regular cross-border
dialogue to share experience. A dedicated cross-functional team
is in place to monitor potential new playersā strategies and/or
recent market developments as well as to understand customersā
current and future buying criteria. Commercial market and sales
organisations monitor this for early indicators. In accordance with
observations and feedback, Solar continues to invest in digital
tools and value-adding services to adapt to new trends.
New entrants in
the market
F G
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I appreciate Solar Lightās professionalism and their readiness to take on challenges.
Their lighting calculations and quantity descriptions for the Ć
ngstrƶmlaboratoriet
project at Uppsala university are always supported by sound documentation.
Krister Blom
Project manager at Galore Electro
Corporate
matters
Corporate governance
Board of Directors
Executive management
Shareholder information
06
32Solar A/S - Annual Report 2022
Corporate matters
06
Risk management05Sustainability04Financial review0302 Strategy01 HighlightsManagement review
Solar complies with corporate
governance recommendations
Solar regards the 2020 recommendations as a
valuable tool for exercising sound management,
providing shareholders and other stakeholders
with full transparency and ensuring efficient risk
management.
A full description of Solarās views on the individual
items in the corporate governance recommendations
is available at:
Deviation
Solar complies with 39 of the 40 recommendations
but deviates from.
Recommendation on the variable part of
remuneration
Limits have been set as to the size of both share-
based and non-share-based incentive payments in
relation to the fixed remuneration in order to ensure
an appropriate balance between long-term and short-
term interests and balanced risk.
As a simple model for allocation of variable
remuneration is applied, the Board of Directors does
not deem it relevant to assess the value of this in
different scenarios.
Solar has set out our practice
in relation to the 2020
recommendations of the Danish
Committee on Corporate
Governance.
www.solar.eu/investor/corporate-governance
Corporate governance
www.solar.eu/investor/corporate-governance
www.solar.eu/investor/corporate-governance
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02 Strategy Financial review03 Sustainability0401 Highlights
Board of Directors
Nomination Committee
Once a year, the composition of the Board of Directors
is assessed by a representative from the companyās
majority shareholder, the F und of 20th December ,
together with three representatives from the board,
including the chair of the companyās Board of Directors.
The committee puts forward proposals for both
re-election and election of new members of the
Board of Directors and the Board's annual evaluation
is included as part of the process. The committee
can seek assistance from external advisers and
shareholders and undertakes a number of preparatory
tasks to ensure that the Board of Directors meets the
guidelines laid down by the Board of Directors at all
times. Emphasis is placed on members representing
relevant expertise in relation to the companyās
requirements. The aim remains to ensure diversity
and a balance between continuity and renewal of
the Board of Directors.
The Nomination Committee is not a board committee
in the same sense as the Audit and Remuneration
Committees, and the Board of Directorsā tasks in
relation to the composition of the board have not
changed since its establishment.
A charter determining the guidelines for the
composition and tasks of the Nomination Committee
is available at:
Diversity in the Board of Directors
Solarās diversity policy sets out our objective for the
composition of the Board of Directors.
When board members are replaced, we conduct a broad
sweep of the market to ensure a mix of skills
and diversity.
The Board of Directors strives for equal gender
representation, while ensuring that it has a broad
portfolio of skills and experience. Our aim is to ensure
that women are not underrepresented.
At the Annual General Meeting in 2022, Katrine Borum
was elected replacing Jens Borum.
We reached our 2023 aim as women now make up
2 of 6 board members elected at the Annual General
Meeting which according to law is considered an
even distribution.
Corporate governance structure
The Board of Directors and the
Executive Board, which comprises
the CEO, CCO and CFO, are jointly
responsible for Solar Groupās overall
and strategic management.
www.solar.eu
External
auditor
Internal
Audit
Shareholders/
general meeting
Executive Board
Audit
Committee
(establ. 2007)
Remuneration
Committee
(establ. 2017)
Nomination
Committee
(establ. 2019)
Board of Directors
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06
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02 Strategy Financial review03 Sustainability0401 Highlights
Board of Directors' affiliation with Solar
Peter Bang, Morten Chrone, Louise Knauer and
Michael Troensegaard Andersen are independent
of the company pursuant to the definition in the
recommendations on corporate governance in Denmark.
Jesper Dalsgaard and Katrine Borum is affiliated
with the Fund of 20th December, Solar's majority
shareholder.
In 2022, the Board of Directors elected Peter Bang,
Michael Troensegaard Andersen and Louise Knauer as
members of the Audit Committee. Peter Bang chairs
the Audit Committee. He and Michael Troensegaard
Andersen have special accountancy qualifications.
The Board of Directors elected Morten Chrone and
Louise Knauer as members of the Remuneration
Committee together with the Chair of the Board of
Directors Michael Troensegaard Andersen. Michael
Troensegaard Andersen chairs the Remuneration
Committee.
Employee representatives
The most recent ordinary election of employee
representatives was held electronically on 21 February ā
3 March 2022. Rune Jesper Nielsen, Denise Goldby, and
Michael KƦrgaard Ravn were elected as members of the
Board of Directors -all three of them as new members.
Under the law, employee representatives have the
same rights, duties and responsibilities as the other
members of the board. Under Danish law, employees
have the right to elect a number of representatives and
alternates, corresponding to half the representatives
elected by the Annual General Meeting at the time
of the announcement of the election of employee
representatives.
Election period
All board members elected at the Annual General
Meeting stand for election each year, whereas employee
representatives are elected by the companyās employees
for four-year terms.
Activities
A minimum of six ordinary board meetings as well
as one Board of Directorsā conference are held each
year. In 2022, we had nine board meetings and one
conference for the Board of Directors.
Evaluation
During Q4 2022, an externally facilitated board
evaluation process was conducted, among others
covering the cooperation between the Board of
Directors and the Executive Board, the Chair's role, the
Board's and Board Committees' work and an assessment
of Board capabilities relative to those best supporting
the Solar's strategy.
All members of the Board of Directors participated in
the evaluation and provided input via questionnaires
and interviews, thus forming the basis of an evaluation
report. The 2022 evaluation has been shared with the
Nomination Committee and has not given rise to any
additional measures.
Meeting attendance in 2022
1
Joined at AGM 18 March 2022
2
Left at AGM 18 March 2022
Board member
Board
Meetings
Board
Conference
Audit
Committee
Remuneration
Committee
Michael Troensegaard Andersen 9 1 7 1
Jesper Dalsgaard 9 1 - ā
Peter Bang 8 1 7 ā
Katrine Borum
1
7 1 ā ā
Morten Chrone 9 1 ā 1
Denise Goldby
1
6 1 ā ā
Louise Knauer 9 ā 7 1
Rune Jesper Nielsen
1
7 1 ā ā
Michael KƦrgaard Ravn
1
7 1 ā ā
Jens Borum
2
3 ā ā ā
Lars Lange Andersen
2
3 ā ā ā
Ulrik Damgaard
2
3 ā ā ā
Bent Frisk
2
3 ā ā ā
Board of Directors
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Members of the Board of Directors
Board of Directors
Michael Troensegaard Andersen
Born 1961
Joined 2021
Chair
ā¢ Master of Science in Mechanical Engineering
from Denmarkās Technical University (1987) and
a Graduate Diploma in Business Administration
(Financial and Management Accounting) from
Copenhagen Business School (1988).
ā¢ Member of the board of directors of Hansen-
Group A/S.
ā¢ Possesses experience as CEO in listed compa-
nies and of strategic, structural and organisa-
tional transformation, sustainability and green
transition, together with in-depth knowledge
of the European Building and Building Material
Industry.
ā¢ Remuneration 2022: DKK 726,250.
ā¢ Holds 774 Solar B shares of which 264 were
acquired in 2022.
Jesper Dalsgaard Jensen
Born 1968
Joined 2017
Vice Chair
ā¢ Managing Director, RambĆøll Environment &
Health, RambĆøll Group A/S.
ā¢ M.Sc. in Law and Business Administration 1993.
ā¢ Member of the board of directors of the Fund
of 20th December, RambĆøll Management Con-
sulting A/S and Mannaz A/S.
ā¢ Possesses executive management experience of
companies managed by funds and companies
within the construction industry, and has expe-
rience within strategy, business development,
mergers & acquisitions together with in-depth
knowledge and experience within sustainability
and green transition.
ā¢ Remuneration 2022: DKK 453,750.
ā¢ Holds 1,100 Solar B shares. Did not trade Solar
shares in 2022.
Peter Bang
Born 1969
Joined 2018
ā¢ Cand.oecon. 1994 from Aarhus University, spe-
cialising in business economics and financing.
ā¢ Chair of the board of directors of BIMobject AB.
ā¢ Experience within construction, climate/energy,
sustainability and green transition, digitalisa-
tion, organisational development, as well as
finance and performance management.
ā¢ Remuneration 2022: DKK 511,250.
ā¢ Holds 1,200 Solar B shares. Did not trade
Solar shares in 2022.
Katrine Borum
Born 1981
Joined 2022
ā¢ Senior registrar at NordsjƦllands Hospital.
ā¢ Cand.med. University of Copenhagen 2010,
Orthopedic specialist, 2021.
ā¢ Member of Danish Orthopaedic Societyās
education committee.
ā¢ Experience with managing many professions
and developing an educational environment.
ā¢ Remuneration 2022: DKK 270,000.
ā¢ Holds 42,723 Solar B shares. Inherited 45,970 and
divested 8,247 Solar B shares in 2022.
Morten Chrone
Born 1966
Joined 2019
ā¢ Group CEO, Unisport Saltex Oy.
ā¢ MBA 2001 and B.Eng. in Civil and Constructional
Engineering 1994.
ā¢ Chair of the board of Unisport Scandinavia ApS
and CEO of Mads ApS.
ā¢ Has held management positions within the
construction industry/wholesale business in
Denmark and abroad for the past 25 years
and has significant knowledge of Solarās core
business and the markets we operate in.
ā¢ Remuneration 2022: DKK 338,750.
ā¢ Holds 712 Solar B shares. Did not trade Solar
shares in 2022.
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Denise Goldby
Born 1987
Joined 2022
Employee-elected member
ā¢ Head of Solar's Copenhagen and Amager
customer centres.
ā¢ Remuneration 2022: DKK 150,000.
ā¢ Holds 20 Solar B shares which were acquired in
2022.
Rune Jesper Nielsen
Born 1971
Joined 2022
Employee-elected member
ā¢ Warehouse employee.
ā¢ Remuneration 2022: DKK 150,000.
ā¢ Holds no Solar shares. Did not trade
Solar shares in 2022.
Michael KƦrgaard Ravn
Born 1971
Joined 2022
Employee-elected member
ā¢ Account Manager, Industry OEM.
ā¢ Remuneration 2022: DKK 150,000.
ā¢ Holds 123 Solar B shares. Did not trade
Solar shares in 2022.
Board of Directors
Members of the Board of Directors
Louise Knauer
Born 1983
Joined 2017
ā¢ CED of Lady Invest ApS and Itās a club ApS.
ā¢ BSc in business administration and commercial
law, 2006, and MSc in finance and strategic
management, 2008.
ā¢ Member of the boards of directors of Rekom Group
Holding ApS, Rekom Group A/S, CC Mist NEW Hold-
ing II ApS, CC Fly Holding II A/S, CC Globe Holding
I ApS, CC Globe Holding II A/S, FERM LIVING ApS,
Skako A/S and two subsidiaries hereof.
ā¢ Possesses experience as CEO and member of
executive committees of listed and family-owned
companies. Has experience within strategy, M&A,
and organisational development, and company
turnarounds. In addition, expertise within tech, inno-
vation, digitisation, data/AI/ML and cyber security.
ā¢ Remuneration 2022: DKK 411,250.
ā¢ Holds 381 Solar B shares. Did not trade Solar shares
in 2022.
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Jens E. Andersen
Born 1968
CEO
ā¢ Chair of the boards of directors of 7 Solar
Group subsidiaries.
ā¢ Member of the boards of directors of VELTEK,
Associated Danish Ports A/S and HF Christian-
sen Holding A/S and two subsidiaries hereof.
ā¢ Holds 10,664 Solar B shares of which 1,422 were
acquired in 2022.
ā¢ Holds 10,952 restricted share units. 4,421
restricted share units were granted and 1,641
were settled in 2022.
ā¢ Remuneration: DKK 12.2m.
Hugo Dorph
Born 1965
CCO
ā¢ Member of the boards of directors of 5 Solar
Group subsidiaries.
ā¢ Chair of the board of directors of Flexya A/S,
Flexya Innovations A/S and LetsBuild Denmark
ApS.
ā¢ Vice chair of the board of directors of HomeBob
A/S.
ā¢ Holds no Solar shares.
ā¢ Holds 5,766 restricted share units. 2,500 re-
stricted share units were granted and 952 were
settled in 2022.
ā¢ Remuneration: DKK 6.9m.
Michael H. Jeppesen
Born 1966
CFO
ā¢ Member of the boards of directors of all Solar
Group subsidiaries.
ā¢ Member of the boards of directors of Aktiesel-
skabet SĆønder Omme Plantage.
ā¢ Holds 4,080 Solar B shares. Did not trade Solar
shares in 2022.
ā¢ Holds 5,643 restricted share units. 2,377
restricted share units were granted and 793
were settled in 2022.
ā¢ Remuneration: DKK 6.9m.
Executive Board and
Solar Group Management
Solar Group Management comprises the
Executive Board, our Senior Vice Presidents
and the MDs of the Solar Group subsidiaries.
Solar Group Management
Carsten L. Antonisen Born 1965,
Senior Vice President & MD Solar Danmark
Jan Willy FjellvƦr Born 1961,
Senior Vice President & MD Solar Norge
Lars Goth Born 1961,
Senior Vice President, Group Operations
Anders Koppel Born 1969,
Senior Vice President & MD Solar Sverige
Anders Solberg Odgaard Born 1971,
Senior Vice President, CIO
Peter Pedersen Born 1970,
Senior Vice President, Commercial Market
Michiel Rohrman Born 1967,
Senior Vice President & MD Solar Nederland
Frank Simonsen Born 1978,
Senior Vice President, Finance
Ole SĆørensen Born 1971,
Senior Vice President, Industry Sales
Dariusz Targosz Born 1969,
Senior Vice President & MD Solar Polska
Bauke Zeinstra Born 1966,
Senior Vice President & MD MAG45
Executive management
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The Solar share price development
On 31 December 2022, the price of Solarās B share
was DKK 620, down from the 2022 starting price of
DKK 795. This is a decrease of approx. 22% over the year.
By way of comparison, the MidCap index decreased by
11.7% in 2022.
Over a five-year period, Solarās B share has generated
a total shareholder return of 95%.
Dividends
The Board of Directors proposes that the Annual
General Meeting approves a dividend of DKK 45.00 per
share for a total payout of DKK 329 million for the 2022
financial year. The proposed dividend corresponds to
a payout ratio of 50%. The proposal is in line with the
previously stated plan to have a payout ratio of at least
35% of profits after tax. If approved, the 2022 dividend
will be disbursed on March 22, 2023, with March 17, 2023
as the last trading day with dividend.
In 2022, Solar paid out DKK 658m as
ordinary and extraordinary dividend,
corresponding to a payout ratio of
124%.
Shareholder
information
Solarās Annual General Meeting will be held
on Friday 17 March 2023 at 11.00.
Shareholders can register for the Annual General
Meeting at the investor portal accessible via:
The Board of Directors will submit the
following items for approval by the Annual General
Meeting:
ā¢ Payment of DKK 45.00 in return per share
outstanding of DKK 100.
ā¢ Authority to potentially pass a resolution to
distribute extraordinary dividends of up to DKK
50.00 per share.
ā¢ Authority to acquire treasury shares valued at up
to 10% of share capital.
ā¢ Change of the articles of association including
prolongation of authorisation to implement
capital increase.
ā¢ Change of remuneration policy primarily in
relation to clarifications but also including a
change for board members to receive meeting
attendance fees instead of compensation for lost
income.
ā¢ Approval of remuneration report 2022.
ā¢ Approval of the Board of Directorsā remuneration
of an unchanged DKK 200,000 in 2023 and meeting
attendance fees of DKK 15,000 for physical
meetings and DKK 7,500 for digital meetings in
2023.
A presentation of our Board of Directors can be
found on pages 36-37.
Annual general meeting
www.solar.eu/investor/
Dividend payments
DKK million 2022 2021 2020 2019 2018
Ordinary, dividend 329 204 102 102 102
Extraordinary, dividend 329 110 ā ā ā
Total, dividend 658 314 102 102 102
Payout ratio in % 124 62 92 159 77
The Solar share
A share B share
Shares 900,000 6,460,000
Nominel value (DKK) 100 100
Votes per share 10 1
Treasury shares - 56,813
Stock Exchange
-
Nasdaq Copenhagen
Stock Exchange
Ticker symbol Solar B
Share price year-end (DKK)
620 620
Market Cap year-end (DKKm)
558 4,005
39
Management review
Solar A/S - Annual Report 2022
Corporate matters
06
Risk management05
02 Strategy Financial review03 Sustainability0401 Highlights
Annual Report 2022
Annual General Meeting
Quarterly Report Q1 2023
Quarterly Report Q2 2023
Quarterly Report Q3 2023
Shareholder information
Analysts
The following financial institutions cover the
Solar share:
ā¢ Carnegie Bank
ā¢ SEB
We are expecting coverage from additional
financial institutions during 2023.
Investor contact
Dennis Callesen
Investor Relations Director
Tel.: +45 29 92 18 11
E-mail: deca@solar.dk
Financial calendar 2023
Share price development (index)
31.12.2022
01.01.2022
MidCap Solar B
120
110
100
90
80
70
60
50
09
Feb
17
Mar
04
May
10
Aug
02
Nov
Shareholders according to section 55
of the Danish Comapnies Act
Share
Capital Votes
The Fund of 20th December, Vejen,
Denmark
17.0% 60.5%
Nordea Funds Ltd., Helsinki, Finland 10.4% 5.0%
Shareholders with more than 5%
of shares or votes
Investor relations policy
We strive to maintain an open dialogue with investors
and to provide them with accurate and adequate
information for making reasoned investment decisions
about Solar's shares. We ensure all investors are given
fair and equal access to information by publishing
relevant information via Nasdaq Copenhagen. We
participate in conferences, arrange roadshows and
organise meetings with investors and financial
analysts following the publication of quarterly and
annual reports. Investor meetings and similar events
cannot be held during our quiet periods, which start
on 2 January, 3 April, 3 July and 2 October and end
with the publication of a quarterly or annual report.
40
Management review
Solar A/S - Annual Report 2022
Corporate matters
06
Risk management05
02 Strategy Financial review03 Sustainability0401 Highlights
Financial Statements
Solar A/S - Annual Report 2022
Contents
42
Consolidated financial statements
Income statement (DKK million) 2022 2021 2020 2019 2018
Revenue 13,863 12,354 11,465 11,679 11,098
Earnings before interest, tax, depreciation and amortisation
(EBITDA) 1,175 911 637 538 379
Earnings before interest, tax and amortisation (EBITA) 978 727 455 360 327
Earnings before interest and tax (EBIT) 909 672 248 260 224
Financials, net -50 -48 -40 -35 -35
Earnings before tax (EBT) 858 622 300 120 237
Net profit for the year 660 531 222 64 133
Cash ļ¬ow (DKK million) 2022 2021 2020 2019 2018
Cash flow from operating activities 16 783 813 300 224
Cash flow from investing activities -259
-191
162 -194 -112
Cash flow from financing activities -82 -515 -627 -110 -108
Net investments in intangible assets -59 -58 -50 -35 -88
Net investments in property, plant and equipment -167 -125 -25 -110 -59
Acquisition and divestment of subsidiaries
and operations, net -34 0 0 -35 50
Summary for the Solar Group
Balance sheet (DKK million) 2022 2021 2020 2019 2018
Non-current assets 1,564 1,415 1,339 1,756 1,516
Current assets 4,337 3,890 3,268 3,234 3,117
Balance sheet total 5,901 5,305 4,607 4,990 4,633
Equity 1,931 1,952 1,696 1,592 1,638
Non-current liabilities 709 435 498 503 543
Current liabilities 3,261 2,918 2,413 2,895 2,452
Interest-bearing liabilities, net 1,074 -37 128 921 461
Invested capital 2,978 1,866 1,760 2,297 1,797
Net working capital, year-end 2,205 1,259 1,109 1,280 1,090
Net working capital, average 2,010 1,363 1,322 1,386 1,182
Financial ratios (% unless otherwise stated) 2022 2021 2020 2019 2018
Revenue growth 12.2 7.8 -1.8 5.2 0.3
Organic growth 12.9 6.4 -1.2 4.8 1.8
Organic growth adjusted for number of working days 12.9 5.9 -2.0 4.9 2.2
Gross profit margin 23.4 22.4 21.0 20.1 20.2
EBITDA margin 8.5 7.4 5.6 4.6 3.4
EBITA margin 7.1 5.9 4.0 3.1 2.9
EBIT margin 6.6 5.4 2.2 2.2 2.0
Effective tax rate 23.1 14.6 26.0 45.2 23.3
Net working capital (year-end NWC)/revenue (LTM) 15.9 10.2 9.7 11.0 9.8
Net working capital (average NWC)/revenue (LTM) 14.5 11.0 11.5 11.9 10.6
Gearing (net interest-bearing liabilities/EBITDA),
no. of times 0.9 0.0 0.2 1.7 1.2
Return on equity (ROE) 34.0 29.1 13.5 4.0 8.2
Return on invested capital (ROIC) 25.5 24.6 13.8 8.3 8.1
Enterprise value/earnings before interest, tax and
amortisation (EV/EBITA) 5.7 7.8 5.8 7.9 6.8
Equity ratio 32.7 36.8 36.8 31.9 35.4
2018-2022
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
43
Share ratios (DKK unless otherwise stated) 2022 2021 2020 2019 2018
Earnings per share outstanding (EPS) 90.37 72.72 30.42 8.77 18.22
Intrinsic value per share outstanding 264.41 267.28 232.38 218.13 224.44
Cash flow from operating activities per share outstanding 2.19 107.23
111.40 41.11 30.67
Share price 622.62 795.05 353.70 297.31 284.12
Share price/intrinsic value 2.35 2.97 1.52 1.36 1.27
Ordinary dividend per share 45.00 45.00 28.00 14.00 14.00
Extraordinary dividend per share - 45.00 15.00 - -
Total dividend in % of net profit for the year (payout ratio) 49.8 123.8 141.1 159.4 76.7
Price Earnings (P/E) 6.9 10.9 11.6 33.9 15.6
Summary for the Solar Group
Employees 2022 2021 2020 2019 2018
Average number of employees (FTEs) 3,019 2,908 2,935 3,039 2,941
2018-2022 ā continued
Definitions
Organic growth Revenue growth adjusted for enterprises acquired and divested and any exchange rate
changes. No adjustments have been made for number of working days.
Net working capital Inventories and trade receivables less trade payables.
ROIC Return on invested capital calculated on the basis of EBIT exclusive impairment on
goodwill less tax calculated using the effective tax rate adjusted for one-off effects.
In all material aspects financial ratios are calculated in accordance with the Danish Finance
Societyās āRecommendations & Financial Ratiosā. As at 1 January 2019, Solar implemented IFRS 16,
Leases, by applying the modified retrospective approach. Comparative figures are not restated.
This especially affects EBITDA, interest-bearing liabilities, EBITDA margin, gearing and equity ratio.
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
44
Income statement
Notes DKK million 2022 2021
2.1 Revenue 13,863 12,354
Cost of sales -10,618 -9,581
Gross profit 3,245 2,773
Other operating income 0 7
5.4 External operating costs -386 -297
2.2 Staff costs -1,656 -1,552
2.3 Loss on trade receivables -28 -20
Earnings before interest, tax, depreciation and amortisation (EBITDA) 1,175 911
2.4 Depreciation and write-down on property, plant and equipment -197 -184
Earnings before interest, tax and amortisation (EBITA) 978 727
2.4 Amortisation and impairment of intangible assets -69 -55
Earnings before interest and tax (EBIT) 909 672
3.4 Share of net profit from associates -1 -2
4.4 Financial income 53 41
4.5 Financial expenses -103 -89
Earnings before tax (EBT) 858 622
2.5 Income tax -198 -91
2.6 Net profit for the year 660 531
4.2 Earnings in DKK per share outstanding (EPS) for the year 90.37 72.72
4.2 Diluted earnings in DKK per share outstanding (EPS-D) for the year 90.05 72.50
Statement of comprehensive income
Other comprehensive income
DKK million 2022 2021
Net profit for the year 660 531
Items that can be reclassified to the income statement
Foreign currency translation adjustments of foreign subsidiaries -51 14
Fair value adjustments of hedging instruments before tax 36 29
Tax on fair value adjustments of hedging instruments
-8 -6
Other income and costs recognised after tax -23 37
Total comprehensive income for the year
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
45
As at 31 December
Notes DKK million 2022 2021
Assets
3.1 Intangible assets 173 159
3.2 Property, plant and equipment 963 885
3.3 Right-of-use assets 383 300
2.5 Deferred tax assets 9 13
3.4 Investments in associates 4 5
Other non-current assets 32 53
Non-current assets 1,564 1,415
3.5 Inventories 2,248 1,855
3.6 Trade receivables 1,859 1,502
Income tax receivable 13 0
Other receivables 9 6
Prepayments 42 46
Cash at bank and in hand 166 481
Current assets 4,337 3,890
Total assets 5,901 5,305
Notes DKK million 2022 2021
Equity and liabilities
4.1 Share capital 736 736
Reserves -181 -158
Retained earnings 1,047 1,045
Proposed dividends for the financial year 329 329
Equity 1,931 1,952
4.3 Interest-bearing liabilities 293 120
3.3, 4.3 Lease liabilities 274 203
2.5 Provision for deferred tax 133 101
3.7 Other provisions 9 11
Non-current liabilities 709 435
4.3 Interest-bearing liabilities 556 19
3.3, 4.3 Lease liabilities 117 102
Trade payables 1,902 2,098
Income tax payable 63 33
3.8 Other payables 604 644
Prepayments 2 1
3.7 Other provisions 17 21
Current liabilities 3,261 2,918
Liabilities 3,970 3,353
Total equity and liabilities 5,901 5,305
Balance sheet
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
46
Notes DKK million 2022 2021
Net profit for the year 660 531
2.4 Depreciation, write-down and amortisation 266 239
Changes to provisions and other adjustments -18 11
Share of net profit from associates 1 2
4.4, 4.5 Financials, net 50 48
Income tax 198 91
4.4 Financial income, received 15 23
4.5 Financial expenses, settled -43 -50
Income tax, settled -155 -81
Cash flow before working capital changes 974 814
Working capital changes
Inventory changes -433 -319
Receivables changes -394 -229
Non-interest-bearing liabilities changes -131 517
Cash flow from operating activities 16 783
Investing activities
3.1 Purchase of intangible assets -59 -58
Purchase of property, plant and equipment -167 -143
Disposal of property, plant and equipment 0 18
Acquisition of associates 0 -5
5.6 Acquisition of subsidiaries and activities -34 0
Other financial investments 1 -3
Cash flow from investing activities -259 -191
Notes DKK million 2022 2021
Financing activities
4.3 Repayment of non-current interest-bearing debt -12 -79
Raising of non-current interest-bearing liabilities 185 0
Change in current interest-bearing debt 519 -9
3.3 Instalment on lease liabilities -116 -115
4.1 Sale of treasury shares 0 2
Dividends distributed -658 -314
Cash flow from financing activities -82 -515
Total cash flow -325 77
Cash at bank and in hand at the beginning of the year 481 404
5.6 Assumed on acquisition of subsidaries 10 0
Cash at bank and in hand at the end of the year 166 481
Cash at bank and in hand 166 481
Cash at bank and in hand at the end of the year 166 481
Cash flow statement
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
47
Statement of changes in equity
DKK million Share capital
Reserves for
hedging
transactions
1
Reserves for
foreign
currency
translation
adjustments
1
Retained
earnings
Proposed
dividends Total
2022
Equity as at 1 January 736 -37 -121 1,045 329 1,952
Foreign currency translation adjustments of foreign subsidiaries -51 -51
Fair value adjustments of hedging instruments before tax 36 36
Tax on fair value adjustments -8 -8
Net income recognised in equity via other comprehensive income in the statement of comprehensive income 0 28 -51 0 0 -23
Net profit for the year 331 329 660
Comprehensive income 0 28 -51 331 329 637
Distribution of dividends (DKK 45.00 per share) -329 -329
Distribution of extraordinary dividend (DKK 45.00 per share) -329 -329
Transactions with the owners 0 0 0 -329 -329 -658
Equity as at 31 December 736 -9 -172 1,047 329 1,931
1) Reserves for hedging transactions and reserves for foreign currency translation adjustments are recognised in the balance sheet as a total amount under reserves.
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
48
Statement of changes in equity
DKK million Share capital
Reserves for
hedging
transactions
1
Reserves for
foreign
currency
translation
adjustments
1
Retained
earnings
Proposed
dividends Total
2021
Equity as at 1 January 736 -60 -135 951 204 1,696
Foreign currency translation adjustments of foreign subsidiaries 14 14
Fair value adjustments of hedging instruments before tax 29 29
Tax on fair value adjustments -6 -6
Net income recognised in equity via other comprehensive income in the statement of comprehensive income 0 23 14 0 0 37
Net profit for the year 202 329 531
Comprehensive income 0 23 14 202 329 568
Distribution of dividends (DKK 28.00 per share) -204 -204
Distribution of extraordinary dividend (DKK 15.00 per share) -110 -110
Sale of treasury shares 2 2
Transactions with the owners 0 0 0 -108 -204 -312
Equity as at 31 December 736 -37 -121 1,045 329 1,952
1) Reserves for hedging transactions and reserves for foreign currency translation adjustments are recognised in the balance sheet as a total amount under reserves.
ā continued
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
c
ContentsContents
49
Financial Statements
Solar A/S - Annual Report 2022
Basis for preparation
Section 1
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Industrivej Vest 43
6600 Vejen
Denmark
Financial Statements
Solar A/S - Annual Report 2022
Contents
50
Basis for preparation
1
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
1.1 General accounting policies
1.2 Significant accounting estimates
and assessments
1.3 Financial risks
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Consolidated financial statements
Financial Statements
Solar A/S - Annual Report 2022
Contents
51
Basis for preparation
1
1.1 General accounting policies
ā continued
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
1.1 General accounting policies
1.2 Significant accounting estimates
and assessments
1.3 Financial risks
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Consolidated financial statements
Financial Statements
Solar A/S - Annual Report 2022
Contents
52
Basis for preparation
1
1.1 General accounting policies
ā continued
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
1.1 General accounting policies
1.2 Significant accounting estimates
and assessments
1.3 Financial risks
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Consolidated financial statements
Contents
w
Contents
Financial Statements
Solar A/S - Annual Report 2022 53
Income statement
Section 2
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
54
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Segment information
2.2 Staff costs
2.3 Loss on trade receivables
2.4 Depreciation, write-down, amortisation
and impairment
2.5 Income tax
2.6 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Income statement
2 Accounting policies
Financial Statements
Solar A/S - Annual Report 2022
Contents
55
2.1 Segment information ā continued
Income statement
2
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Segment information
2.2 Staff costs
2.3 Loss on trade receivables
2.4 Depreciation, write-down, amortisation
and impairment
2.5 Income tax
2.6 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
56
Income statement
2
Average number of employees (FTEs) 3,019 2,908
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Segment information
2.2 Staff costs
2.3 Loss on trade receivables
2.4 Depreciation, write-down, amortisation
and impairment
2.5 Income tax
2.6 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
57
Income statement
2
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Segment information
2.2 Staff costs
2.3 Loss on trade receivables
2.4 Depreciation, write-down, amortisation
and impairment
2.5 Income tax
2.6 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
58
Income statement
2
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Segment information
2.2 Staff costs
2.3 Loss on trade receivables
2.4 Depreciation, write-down, amortisation
and impairment
2.5 Income tax
2.6 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
59
2.5 Income tax ā continued
Income statement
2
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Segment information
2.2 Staff costs
2.3 Loss on trade receivables
2.4 Depreciation, write-down, amortisation
and impairment
2.5 Income tax
2.6 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
60
2.5 Income tax ā continued
Income statement
2
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Segment information
2.2 Staff costs
2.3 Loss on trade receivables
2.4 Depreciation, write-down, amortisation
and impairment
2.5 Income tax
2.6 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
61
Income statement
2
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Segment information
2.2 Staff costs
2.3 Loss on trade receivables
2.4 Depreciation, write-down, amortisation
and impairment
2.5 Income tax
2.6 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
ContentsContents
62Solar A/S - Annual Report 2022
Financial Statements
Invested capital
Section 3
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
63
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Invested capital
3
Financial Statements
Solar A/S - Annual Report 2022
Contents
64
3.1 Intangible assets ā continued
Invested capital
3
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Contents
65Solar A/S - Annual Report 2022
Invested capital
3
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
66
3.2 Property, plant and equipment ā continued
Invested capital
3
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
67
Invested capital
3
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
68
3.3 Leases ā continued
Invested capital
3
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
69
3.3 Leases ā continued
Invested capital
3
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
70
Invested capital
3
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
71
Invested capital
3
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
72
Invested capital
3
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
73
Invested capital
3
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
74
Invested capital
3
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
ContentsContents
Financial Statements
Solar A/S - Annual Report 2022 75
Capital structure
and financing costs
Section 4
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
76
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Earnings per share in DKK per share
outstanding for the year
4.3 Interest-bearing liabilities and
maturity statement
4.4 Financial income
4.5 Financial expenses
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Capital structure and financing costs
4
Financial Statements
Solar A/S - Annual Report 2022
Contents
77
Capital structure and financing costs
4
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Earnings per share in DKK per share
outstanding for the year
4.3 Interest-bearing liabilities and
maturity statement
4.4 Financial income
4.5 Financial expenses
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
78
Capital structure and financing costs
4
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Earnings per share in DKK per share
outstanding for the year
4.3 Interest-bearing liabilities and
maturity statement
4.4 Financial income
4.5 Financial expenses
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
79
4.3 Interest-bearing liabilities and maturity statement ā continued
Capital structure and financing costs
4
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Earnings per share in DKK per share
outstanding for the year
4.3 Interest-bearing liabilities and
maturity statement
4.4 Financial income
4.5 Financial expenses
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
80
4.3 Interest-bearing liabilities and maturity statement ā continued
Capital structure and financing costs
4
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Earnings per share in DKK per share
outstanding for the year
4.3 Interest-bearing liabilities and
maturity statement
4.4 Financial income
4.5 Financial expenses
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
81
4.3 Interest-bearing liabilities and maturity statement ā continued
Capital structure and financing costs
4
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Earnings per share in DKK per share
outstanding for the year
4.3 Interest-bearing liabilities and
maturity statement
4.4 Financial income
4.5 Financial expenses
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
82
Capital structure and financing costs
4
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Earnings per share in DKK per share
outstanding for the year
4.3 Interest-bearing liabilities and
maturity statement
4.4 Financial income
4.5 Financial expenses
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
ContentsContents
83Solar A/S - Annual Report 2022
Financial Statements
Other notes
Section 5
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
84
Other notes
5
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
5.1 Share-based payment
5.2 Contingent liabilities
and other financial liabilities
5.3 Related parties
5.4 Auditorsā fees
5.5 New financial reporting standards
5.6 Acquisitions of subsidiaries and activities
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
85
Other notes
5
5.1 Share-based payment ā continued
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
5.1 Share-based payment
5.2 Contingent liabilities
and other financial liabilities
5.3 Related parties
5.4 Auditorsā fees
5.5 New financial reporting standards
5.6 Acquisitions of subsidiaries and activities
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
86
5.1 Share-based payment ā continued
Other notes
5
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
5.1 Share-based payment
5.2 Contingent liabilities
and other financial liabilities
5.3 Related parties
5.4 Auditorsā fees
5.5 New financial reporting standards
5.6 Acquisitions of subsidiaries and activities
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
87
Other notes
5
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
5.1 Share-based payment
5.2 Contingent liabilities
and other financial liabilities
5.3 Related parties
5.4 Auditorsā fees
5.5 New financial reporting standards
5.6 Acquisitions of subsidiaries and activities
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
88
Other notes
5
Consolidated financial statements
Summary for the Solar Group
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
5.1 Share-based payment
5.2 Contingent liabilities
and other financial liabilities
5.3 Related parties
5.4 Auditorsā fees
5.5 New financial reporting standards
5.6 Acquisitions of subsidiaries and activities
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
90
Income statement
Notes DKK million 2022 2021
Revenue 4,511 4,040
Cost of sales -3,365 -3,046
Gross profit 1,146 994
Other operating income 29 36
5.3 External operating costs -72 -38
2.1 Staff costs -620 -559
2.2 Loss on trade receivables -7 -5
Earnings before interest, tax, depreciation and amortisation (EBITDA) 476 428
2.3 Depreciation and write-down on property, plant and equipment -60 -47
Earnings before interest, tax and amortisation (EBITA) 416 381
2.3 Amortisation and impairment of intangible assets -65 -55
Earnings before interest and tax (EBIT) 351 326
Profit from subsidiaries 418 291
Share of net profit from associates -1 -1
4.3 Financial income 25 29
4.4 Financial expenses -60 -65
Earnings before tax (EBT) 733 580
2.4 Income tax -73 -49
2.5 Net profit for the year 660 531
Statement of comprehensive income
Other comprehensive income
DKK million 2022 2021
Net profit for the year 660 531
Items that can be reclassified to the income statement
Foreign currency translation adjustments of foreign subsidiaries -51 14
Fair value adjustments of hedging instruments before tax, parent company 36 29
Tax on fair value adjustments of hedging instruments, parent company
-8 -6
Other income and costs recognised after tax -23 37
Total comprehensive income for the year
637 568
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
91
As at 31 December
Notes DKK million 2022 2021
Assets
3.1 Intangible assets 148 157
3.2 Property, plant and equipment 450 332
3.3 Right-of-use assets 76 76
3.4 Investments measured at equity value 1,800 1,372
3.4 Other non-current assets 30 51
Non-current assets 2,504 1,988
3.5 Inventories 826 663
3.6 Trade receivables 555 441
Receivables from subsidiaries 202 282
Income tax receivable 7 2
Other receivables 1 4
Prepayments 13 15
Cash at bank and in hand 110 408
Current assets 1,714 1,815
Total assets 4,218 3,803
Notes DKK million 2022 2021
Equity and liabilities
4.1 Share capital 736 736
Reserves -70 -39
Retained earnings 936 926
Proposed dividends for the financial year 329 329
Equity 1,931 1,952
4.2 Interest-bearing liabilities 293 120
3.3, 4.2 Lease liabilities 49 55
2.4 Provision for deferred tax 78 74
3.7 Other provisions 0 1
Non-current liabilities 420 250
4.2 Interest-bearing liabilities 535 9
3.3, 4.2 Lease liabilities 28 23
Trade payables 756 944
Amounts owed to subsidiaries 302 308
3.8 Other payables 243 316
Prepayments 1 1
3.7 Other provisions 2 0
Current liabilities 1,867 1,601
Liabilities 2,287 1,851
Total equity and liabilities 4,218 3,803
Balance sheet
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
92
Notes DKK million 2022 2021
Net profit for the year 660 531
2.3 Depreciation, write-down and amortisation 125 102
Changes to provisions and other adjustments 3 0
Profit from subsidiaries -418 -291
Share of net profit from associates 1 1
4.3, 4.4 Financials, net 35 36
Income tax 73 49
4.3 Financial income, received 17 25
4.4 Financial expenses, settled -32 -39
Income tax, settled -83 -52
Cash flow before working capital changes 381 362
Working capital changes
Inventory changes -163 -130
Receivables changes -114 -98
Non-interest-bearing liabilities changes -225 289
Cash flow from operating activities -121 423
Notes DKK million 2022 2021
Investing activities
3.1 Purchase of intangible assets -56 -58
Purchase of property, plant and equipment -151 -127
Disposal of property, plant and equipment 0 18
Changes to loans to subsidaries 75 129
Dividends from subsidiaries 6 153
Acquistion of subsidiaries and activities -34 0
Acquistion of associates 0 -2
Capital increase subsidiaries -33 0
Other financial investments 1 -3
Cash flow from investing activities -192 110
Financing activities
4.2 Repayment of non-current interest-bearing debt -12 -79
Raising of non-current interest-bearing liabilities 185 0
Change in current interest-bearing liabilities 526 -32
Instalment on lease liabilities -26 -25
Sale of treasury shares 0 2
Dividends distributed -658 -314
Cash flow from financing activities 15 -448
Total cash flow -298 85
Cash at bank and in hand at the beginning of the year 408 323
Cash at bank and in hand at the end of the year 110 408
Cash at bank and in hand 110 408
Cash at bank and in hand at the end of the year 110 408
Cash flow statement
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
93
DKK million Share capital
Reserves for
hedging
transactions
1
Reserves for
foreign
currency
translation
adjustmentsī
Reserves for
development
costsī
Retained
earnings
Proposed
dividends Total
2022
Equity as at 1 January 736 -37 -121 119 926 329 1,952
Foreign currency translation adjustments of foreign subsidiaries -51 -51
Fair value adjustments of hedging instruments before tax 36 36
Tax on fair value adjustments -8 -8
Net income recognised in equity via other comprehensive income in the statement of comprehensive income 0 28 -51 0 0 0 -23
Net profit for the year -8 339 329 660
Comprehensive income 0 28 -51 -8 339 329 637
Distribution of dividends (DKK 45.00 per share) -329 -329
Distribution of extraordinary dividend (DKK 45.00 per share) -329 -329
Transactions with the owners 0 0 0 0 -329 -329 -658
Equity as at 31 December 736 -9 -172 111 936 329 1,931
1) Reserves for hedging transactions, reserves for foreign currency translation adjustments and reserves for development costs are recognised in the balance sheet as a total amount under reserves.
Statement of changes in equity
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
94
Contents
Statement of changes in equity
ā continued
DKK million Share capital
Reserves for
hedging
transactions
1
Reserves for
foreign
currency
translation
adjustments
1
Reserves for
development
costsī
Retained
earnings
Proposed
dividends Total
2021
Equity as at 1 January 736 -60 -135 115 836 204 1,696
Foreign currency translation adjustments of foreign subsidiaries 14 14
Fair value adjustments of hedging instruments before tax 29 29
Tax on fair value adjustments -6 -6
Net income recognised in equity via other comprehensive income in the statement of comprehensive income 0 23 14 0 0 0 37
Net profit for the year 4 198 329 531
Comprehensive income 0 23 14 4 198 329 568
Distribution of dividends (DKK 28.00 per share) -204 -204
Distribution of extraordinary dividend (DKK 15.00 per share) -110 -110
Sale of treasury shares 2 2
Transactions with the owners 0 0 0 0 -108 -204 -312
Equity as at 31 December 736 -37 -121 119 926 329 1,952
1) Reserves for hedging transactions, reserves for foreign currency translation adjustments and reserves for development costs are recognised in the balance sheet as a total amount under reserves.
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Group companies overview
Statements and reports
Q4 2022
Contents
95Solar A/S - Annual Report 2022
Financial Statements
Contents
Basis for preparation
Section 1
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
96
1.1 General accounting policies
The separate financial statements of the parent
company for 2022 are presented in accordance
with the International Financial Reporting
Standards (IFRSs) as approved by the EU and
additional Danish disclosure requirements for
annual reports of listed companies and the IFRS
executive order issued in accordance with the
Danish Financial Statements Act.
A general description of accounting policies can
be found in the consolidated financial statements
on pages 50-52 note 1.1, Accounting policies.
When preparing the annual report in accordance
with generally applicable principles, management
make estimates and assumptions that affect
the reported assets and liabilities. Management
base their estimates on historic experience and
expectations for future events. Therefore, actual
results may differ from these estimates.
The following estimates and accompanying
assessments are deemed material for the
preparation of the financial statements:
ā¢ Impairment test of equity investments
ā¢ Impairment test of software
ā¢ Inventory write-down
ā¢ Write-down for loss on doubtful receivables
Basis for preparation
Descriptions of accounting policies in notes
Descriptions of accounting policies in the notes
form part of the overall description of accounting
policies. Parent-specific descriptions are found in
the following notes:
Note 2.4 Income tax
Note 2.5 Net profit for the year
Note 3.1 Intangible assets
Note 3.2 Property, plant and equipment
Note 3.3 Leases
Note 3.4 Investments measured at equity value
and other non-current assets
Note 3.5 Inventories
Note 3.6 Trade receivables
Note 3.7 Other provisions
Note 4.1 Share capital
Note 4.2 Interest-bearing liabilities
Note 5.1 Contingent liabilities and other
financial liabilities
These estimates and assessments are described
in the following notes:
Note 3.1 Intangible assets
Note 3.5 Inventories
Note 3.6 Trade receivables
1
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
1.1 General accounting policies
1.2 Significant accounting estimates
and assessments
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
1.2 Significant accounting estimates and assessments
Contents
Solar A/S - Annual Report 2022
Financial Statements
97
Contents
Income statement
Section 2
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
98
Income statement
2
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Staff costs
2.2 Loss on trade receivables
2.3 Depreciation, write-down, amortisation
2.4 Income tax
2.5 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
DKK million 2022 2021
Salaries and wages etc. 561 509
Pensions, defined contribution 40 36
Costs related to social security 13 12
Share-based payment 6 2
Total 620 559
Average number of employees (FTEs) 869 810
Number of employees at year-end (FTEs) 886 847
Remuneration of Board of Directors
Remuneration of Board of Directors 3 3
Remuneration of Executive Board
Salaries and wages etc. 22 20
Share-based payment
1
4 7
Total 26 27
1) The amount stated is the total cost related to share-based payment. A part of this cost is included in financial
expenses, which in 2022 amounted to DKK 0m (2021: DKK 5m)
2.1 Staff costs
Terms of notice for members of the Executive Board is 12 months. When stepping down, the members of
the Executive Board are entitled to 6 monthsā remuneration.
Financial Statements
Solar A/S - Annual Report 2022
Contents
99
DKK million 2022 2021
Buildings 14 14
Plant, operating equipment, tools and equipment 17 7
Leasehold improvements 2 1
Tenancy, lease 14 13
Cars, lease 8 7
IT equipment, lease 5 5
Total depreciation and write-down on property, plant and equipment 60 47
Customer-related assets 0 1
Software 65 54
Total amortisation and impairment of intangible assets 65 55
Relevant accounting policies are described in note 3.1, intangible assets, and note 3.2, property, plant and
equipment, and note 3.3, leases.
DKK million 2022 2021
Recognised losses 6 6
Received on trade receivables previously written off 0 0
6 6
Change in write-down for bad and doubtful debts 1 -1
Total 7 5
Relevant accounting policies are described in note 3.6, trade receivables.
2.2 Loss on trade receivables 2.3 Depreciation, write-down and amortisation
Income statement
2
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Staff costs
2.2 Loss on trade receivables
2.3 Depreciation, write-down, amortisation
2.4 Income tax
2.5 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
100
Income statement
2 Accounting policies
Tax for the year is recognised with the share attributable
to results for the year in the income statement and with
the share attributable to other recognised income and
costs in the statement of comprehensive income. Tax
consists of current tax and changes to deferred tax.
DKK million 2022 2021
Current tax 78 73
Deferred tax -4 -4
Tax on profit for the year 74 69
Tax on taxable profit previous year -1 -20
Total 73 49
Statement of effective tax rate:
Danish income tax rate 22.0% 22.0%
Profit/loss from subsidiaries -12.6% -11.0%
Impairment on / gain from sale of / reversal of impairment on associates 0.5% 0.0%
Non-taxable/deductible items in parent 0.1% 0.8%
Tax regarding prevoius year 0.0% -3.3%
Effective tax rate 10.0% 8.5%
2.4 Income tax
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Staff costs
2.2 Loss on trade receivables
2.3 Depreciation, write-down, amortisation
2.4 Income tax
2.5 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
101
Accounting policies
Current tax liabilities and current tax receivables are
recognised in the balance sheet as calculated tax on the
yearās taxable income, adjusted for tax on previous yearās
taxable income and for tax paid on account.
Deferred tax is measured in accordance with the balance
sheet liability method of all temporary differentials
between accounting and tax-related amounts and
provisions. Deferred tax is recognised at the local tax
rate that any temporary differentials are expected to be
realised at based on the adopted or expected adopted
tax legislation on the balance sheet date.
Deferred tax assets, including the tax value of tax loss
allowed for carryforward, are measured at the value at
which the asset is expected to be realised, either by
elimination in tax of future earnings or by offsetting
against deferred tax liabilities.
Deferred tax assets are assessed annually and only
recognised to the extent that it is probable that they
will be utilised.
Deferred tax is also recognised for the covering of
retaxation of losses in former foreign subsidiaries
participating in joint taxation assessed as becoming
current.
DKK million 2022 2021
Deferred tax 1/1 74 72
Recognised in other comprehensive income 8 6
Ordinary tax recognised in income statement -4 -4
Other items 0 0
Deferred tax 31/12 78 74
Specified as follows:
Deferred tax 78 74
Deferred tax assets 0 0
Total deferred tax, net 78 74
Further specified as follows:
Expected use within 1 year 0 0
Expected use after 1 year 78 74
Total, net 78 74
2.4 Income tax ā continued
Income statement
2
DKK million 2021
Recognised
in other
comprehensive
income
Ordinary tax
recognised
in income
statement 2022
Property, plant and equipment 23 0 5 28
Other items
1
51 8 -9 50
Total, net 74 8 -4 78
1) Other items particularly cover intangible assets and loss balances in jointly taxed entities.
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Staff costs
2.2 Loss on trade receivables
2.3 Depreciation, write-down, amortisation
2.4 Income tax
2.5 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
102
Accounting policies
Dividends
Proposed dividends are recognised as a liability at the
time of adoption of the general meeting.
DKK million 2022 2021
Proposed distribution of net profit for the year:
Proposed dividend 329 329
Reserves for development costs -8 4
Retained earnings 339 198
Net profit for the year 660 531
Ordinary dividend in DKK per share of DKK 100
1
45.00 45.00
Extraordinary dividend in DKK per share of DKK 100
2
- 45.00
1) Calculations are based on proposed dividends.
2) Based on 2021 results, an extraordinary dividend was paid in H1 2022.
2.5 Net profit for the year
Income statement
2
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
2.1 Staff costs
2.2 Loss on trade receivables
2.3 Depreciation, write-down, amortisation
2.4 Income tax
2.5 Net profit for the year
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Contents
103Solar A/S - Annual Report 2022
Financial Statements
Contents
Invested capital
Section 3
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
104
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Accounting policies
Customer-related intangible assets
Customer-related intangible assets acquired in
connection with business combinations are measured at
cost less accumulated amortisation and impairment loss.
Customer-related intangible assets are amortised using
the straight-line principle over the expected useful life.
Typically, the amortisation period is 5-7 years.
Software
Software is measured at cost less accumulated
amortisation and write-down. Cost includes both direct
internal and external costs. Software is amortised using
the straight-line principle over 4-8 years. The basis of
amortisation is reduced by any write-down.
3.1 Intangible assets
Invested capital
3
DKK million
Customers-
related
assets Soīware Total
2022
Cost 1/1 5 691 696
Additions during the year 0 56 56
Disposals during the year 0 -46 -46
Cost 31/12 5 701 706
Amortisation and impairment 1/1 3 536 539
Amortisation during the year 0 65 65
Amortisation of abandoned assets 0 -46 -46
Amortisation and impairment 31/12 3 555 558
Carrying amount 31/12 2 146 148
Remaining amortisation period in number of years 3 1-8 -
Financial Statements
Solar A/S - Annual Report 2022
Contents
105
3.1 Intangible assets ā continued
Invested capital
3 Accounting policies ā continued
Impairment of intangible assets
The carrying amount of intangible assets is assessed
annually to determine whether there is any indication of
impairment.
When such an indication is present, the assetās
recoverable amount is calculated, which is the highest
of the assetās fair value less expected costs of disposal
or value in use. Value in use is calculated as the present
value of expected cash flow from the smallest cash-
generating unit to which the asset belongs.
Impairment loss is recognised when the carrying amount
of an asset exceeds the assetās recoverable amount.
Impairment loss is recognised in the income statement.
Impairment loss on intangible assets is reversed if
changes have been made to the assumptions and
estimates that led to the impairment loss.
Accounting estimates
and assessments
Software
Software is evaluated annually for indicators of a need
for impairment. If a need to perform impairment is
identified, an impairment test for the software is
performed.
The impairment test is made on the basis of different
factors, including the softwareās future application, the
present value of the expected cost saving as well as
interest and risks.
DKK million
Customers-
related
assets Soīware Total
2021
Cost 1/1 46 653 699
Additions during the year 0 58 58
Disposals during the year -41 -20 -61
Cost 31/12 5 691 696
Amortisation and impairment 1/1 43 502 545
Amortisation during the year 1 54 55
Amortisation of abandoned assets -41 -20 -61
Amortisation and impairment 31/12 3 536 539
Carrying amount 31/12 2 155 157
Remaining amortisation period in number of years 4 1-8 -
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
106
3.2 Property, plant and equipment
Invested capital
3
DKK million
Land and
buildings
Plant, operating
equipment,
tools and
equipment
Leasehold
improvements
Assets under
construction Total
2022
Cost 1/1 377 219 10 115 721
Additions during the year 105 154 4 117 380
Disposals during the year -1 -119 0 -229 -349
Cost 31/12 481 254 14 3 752
Write-down and depreciation 1/1 190 193 6 0 389
Write-down and depreciation during the year 14 17 2 0 33
Write-down and depreciation of abandoned assets -1 -119 0 0 -120
Write-down and depreciation 31/12 203 91 8 0 302
Carrying amount 31/12 278 163 6 3 450
Accounting policies
Property, plant and equipment
Land and buildings as well as other plant, operating
equipment, and tools and equipment are measured at cost
less accumulated depreciation and write-down.
Cost includes the purchase price and costs directly attributable
to the acquisition until the time when the asset is ready for
use. Cost of a combined asset is disaggregated into separate
components which are depreciated separately if the useful
lives of the individual components differ.
Subsequent expenditure, for example in connection with
the replacement of components of property, plant or
equipment, is recognised in the carrying amount of the
relevant asset when it is probable that the incurrence will
result in future economic benefits for the group.
The replaced components cease to be recognised in the
balance sheet and the carrying amount is transferred
to the income statement. All other general repair
and maintenance costs are recognised in the income
statement when these are incurred.
Property, plant and equipment are depreciated on a straight-
line basis over their estimated useful lives which are:
ā¢ Buildings 40 years
ā¢ Technical installations 20 years
ā¢ Plant, operating equipment, and tools and equipment
2-5 years
There are a few differences from the mentioned
depreciation periods in which useful life is estimated as
shorter. Leasehold improvements are depreciated over the
lease term, however, maximum 5 years.
Land is not depreciated.
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
107
3.2 Property, plant and equipment ā continued
Invested capital
3
DKK million
Land and
buildings
Plant, operating
equipment,
tools and
equipment
Leasehold
improvements
Assets under
construction Total
2021
Cost 1/1 410 244 10 5 669
Additions during the year 0 17 0 123 140
Disposals during the year -33 -42 0 -13 -88
Cost 31/12 377 219 10 115 721
Write-down and depreciation 1/1 194 228 5 0 427
Write-down and depreciation during the year 14 7 1 0 22
Write-down and depreciation of abandoned assets -18 -42 0 0 -60
Write-down and depreciation 31/12 190 193 6 0 389
Carrying amount 31/12 187 26 4 115 332
Accounting policies ā continued
The basis of depreciation is determined in consideration
of the assetās residual value and reduced by any
impairment. Residual value is determined at the time
of acquisition and reassessed annually. If residual value
exceeds the assetās carrying amount, depreciation will
cease.
By changing the depreciation period or residual value,
the effect of future depreciation is recognised as a
change to accounting estimates.
Impairment of property,
plant and equipment
The carrying amount of property, plant and equipment
is assessed annually to determine whether there is any
indication of impairment.
When such an indication is present, the assetās
recoverable amount is calculated, which is the highest
of the assetās fair value less expected costs of disposal
or value in use. Value in use is calculated as the present
value of expected cash flow from the smallest cash-
generating unit to which the asset belongs.
Impairment loss is recognised when the carrying amount
of an asset exceeds the assetās recoverable amount.
Impairment loss is recognised in the income statement.
Write-down on property, plant and equipment is
reversed to the extent that changes have been made
to the assumptions and estimates that led to the write-
down.
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
108
3.3 Leases
Right-of-use assets
Invested capital
3
DKK million Tenancy Cars
IT
equipment Total
2022
Cost 1/1 91 28 21 140
Additions during the year 11 13 3 27
Disposals during the year -4 -7 0 -11
Cost 31/12 98 34 24 156
Write-down and depreciation 1/1 35 19 10 64
Write-down and depreciation during the year
14 8 5 27
Write-down and depreciation of abandoned assets
-4 -7 0 -11
Write-down and depreciation 31/12 45 20 15 80
Carrying amount 31/12 53 14 9 76
Accounting policies ā continued
Right-of-use assets
Right-of-use assets are lease assets arising from a lease
agreement. Lease assets are initially measured at cost
consisting of the amount of the initial measurement of
the lease liability with addition of lease payments made
to the lessor at or before the commencement date less
any lease incentives received. Three different types of
leases have been identified:
ā¢ Tenancy
ā¢ Cars
ā¢ IT equipment
The lease assets are depreciated on a straight-line basis
over the lease term. The carrying amount of the right-
of-use asset can be adjusted due to modifications to the
lease agreement or in special cases reassessment of the
lease term.
Payments associated with short-term leases and leases
of low-value assets are recognised on a straight-line
basis as an expense in the income statement. Short-term
leases are leases with a term of 12 months or less. Low-
value assets comprise IT-equipment and small items of
office furniture of a value below DKK 37,000.
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
109
3.3 Leases ā continued
Right-of-use assets
Invested capital
3
DKK million Tenancy Cars
IT
equipment Total
2021
Cost 1/1 64 28 21 113
Additions during the year 27 2 0 29
Disposals during the year 0 -2 0 -2
Cost 31/12 91 28 21 140
Write-down and depreciation 1/1 22 14 5 41
Write-down and depreciation during the year
13 7 5 25
Write-down and depreciation of abandoned assets
0 -2 0 -2
Write-down and depreciation 31/12 35 19 10 64
Carrying amount 31/12 56 9 11 76
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
110
Invested capital
3
3.3 Leases ā continued
Short-term lease liabilities
DKK million 2022 2021
Maturity < 1 year 28 23
Short-term lease liabilities 31/12 28 23
Long-term lease liabilities
DKK million 2022 2021
Maturity > 1 year < 5 years, undiscounted 42 41
Maturity > 5 years, undiscounted 8 16
Long-term lease liabilities 31/12, undiscounted 50 57
Discounting on lease liabilities > 1 year < 5 years -1 -1
Discounting on lease liabilities > 5 years 0 -1
Long-term lease liabilities 31/12 49 55
Amounts recognized in the Profit & Loss statement
DKK million 2022 2021
Depreciation of Right-of-use assets
26
25
Interest expense on lease liabilities
1
1
Expense relating to short-term leases
0
0
Expense relating to leases of low-value items
0
0
Expense relating to variable lease payments not included in the measurement
of lease liabilities
1 1
Total 28 27
Cash outflows for leases
Instalment on lease liabilities
-26
-25
Interest payments
-1
-1
Total cash outflows for leases -27 -26
Accounting policies
Lease liabilities
Lease liabilities arise from a lease agreement. Lease
liabilities are initially measured at the present value of
the lease payments during the non-cancellable lease
period with addition of periods covered by an option to
extend the lease if exercise of the option is considered
reasonably certain on inception of the lease.
At initial recognition, each contract is assessed
individually to assess the likelihood of exercising a
potential extension option in the contract. The option
to extend the contract period will be included in
measuring the lease liability if it is reasonably certain
that Solar will exercise the option. When calculating
the net present value, a discount rate corresponding to
Solarās incremental borrowing rate has been used.
The lease liability will be remeasured when changes
occur due to modifications to the contract (extension,
termination etc.), indexation or in special cases
reassessment of the lease term.
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
111
Invested capital
3
3.4 Investments measured at equity value and other non-current assets
DKK million
Equity
investments
Investments
in associates
Other
investments
Other
recievables Total
2022
Cost 1/1 2,624 16 59 19 2,718
Additions during the year 67 0 0 1 68
Transferred from Other receivables to other investments 0 0 5 -5 0
Disposals during the year -100 0 -4 0 -4
Cost 31/12 2,591 16 60 15 2,782
Value adjustment 1/1 -1,253 -15 -23 -4 -1,295
Foreign currency translation adjustments -50 0 0 0 -50
Dividends from subsidiaries -6 0 0 0 -6
Profit from subsidiaries 418 -1 0 0 417
Fair value adjustment recognised under financial expenses
0 0 -16 -4
-20
Other adjustments
100 0 2 0
2
Value adjustment 31/12 -791 -16 -37 -8 -952
Carrying amount 31/12
1,800 0 23 7
1,830
Accounting policies
Under the equity method of accounting, the investments
are initially recognised at cost and adjusted thereafter
to recognise the parent companyās share of the post-
acquisition profits or losses of the subsidiary in profit
or loss statement, and the parent companyās share of
movements in other comprehensive income of the
investee in other comprehensive income.
Dividends received or receivable from subsidiaries are
recognised as a reduction in the carrying amount of the
investment.
Unrealised gains on transactions between the parent
company and its subsidiaries are eliminated to the
extent of the parent companyās interest in these
entities. Unrealised losses are also eliminated unless the
transaction provides evidence of an impairment of the
asset transferred.
Accounting policies of equity accounted investees have
been changed where necessary to ensure consistency
with the policies adopted by the parent company.
The carrying amount of equity-accounted investments is
tested for impairment.
Other investments are measured at fair value.
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
112
Invested capital
3
3.4 Investments measured at equity value and other non-current assets ā continued
DKK million
Equity
investments
Investments
in associates
Other
investments
Other
recievables Total
2021
Cost 1/1 2,624 14 55 20 2,713
Additions during the year 0 2 3 7 12
Transferred from other recievables to other investments
0 0 1 -1 0
Disposals during the year 0 0 0 -7 -7
Cost 31/12 2,624 16 59 19 2,718
Value adjustment 1/1 -1,405 -14 -4 -2 -1,425
Foreign currency translation adjustments 14 0 0 0 14
Dividends from subsidiaries -153 0 0 0 -153
Profit from subsidiaries 291 -1 0 0 290
Fair value adjustment recognised under financial expenses 0 0 -19 -4 -23
Other adjustments 0 0 0 2 2
Value adjustment 31/12 -1,253 -15 -23 -4 -1,295
Carrying amount 31/12 1,371 1 36 15 1,423
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
113
3.5 Inventories
Invested capital
3
DKK million 2022 2021
End products 826 663
Recognised write-down 8 0
The main reasons for the recognised write-downs is an increase in write-down articles.
Accounting policies
Inventories are measured at cost according to the FIFO
method or at net realisable value, if this is lower.
Cost of inventories includes purchase price with
addition of delivery costs.
The net realisable value of inventories is determined
as selling price less costs incurred to make the sale
and is determined in consideration of marketability,
obsolescence and development of expected selling
price.
Accounting estimates
and assessments
Write-down of inventories
Write-down of inventories is made due to the
obsolescence of products.
Management specifically assess inventories, including
the productsā turnover rate, current economic trends
and product development when deciding whether the
write-down is sufficient.
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
114
Invested capital
3
3.6 Trade receivablesī
DKK million 2022 2021
Maturity statement, trade receivables
Not due 520 418
Past due for 1-30 day(s) 36 20
Past due for 31-90 days 7 7
Past due for 91+ days 0 2
563 447
Write-down -8 -6
Total 555 441
Write-down based on:
Age distribution 2 1
Individual assessment 6 5
Total 8 6
Write-down 1/1 6 7
Write-down for the year 5 3
Losses realised during the year -2 -2
Reversed for the year -1 -2
Write-down 31/12 8 6
1) A factoring arrangement on non-recourse conditions is established with a few major customers. As a result
trade receivables is reduced with approx. DKK 97m (DKK 78m).
We refer to the consolidated accounts, note 3.6, trade receivables, for information on credit risk.
Accounting policies
Trade receivables are measured at fair value at acquisition
and at amortised cost subsequently. Based on an individual
assessment of the loss risk, including a statistical based
model, write-down to amortised cost less expected credit
losses is made, if this is lower.
Accounting estimates
and assessments
Write-down for meeting of loss on doubt-
ful trade receivables
The IFRS 9 simplified approach is applied to measure
expected credit losses, which uses a lifetime expected loss
allowance for all trade receivables.
To measure the expected credit losses, trade receivables
have been grouped based on shared credit risk
characteristics and the day past invoicing.
As the vast majority of our group companies generally takes
out insurance to hedge against loss to the extent possible, the
write-down based on age distribution amounts to less than
0.4% (0.2%) of gross trade receivables.
Individual assessment of write-down is performed by
management specifically analysing trade receivables,
including the customersā credit rating and current
economic trends to ensure that write-down is sufficient.
Write-down based on individual assessment amounts to
1.4% (1.1%) of gross trade receivables. As the total write-
down on trade receivables amounts to 1% (1%) of gross
trade receivables, no maturity statement of the write-down
is included. However, the majority of the provision relates
to receivables overdue by more than 31 days (31 days).
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
115
3.7 Other provisions
Invested capital
3
DKK million 2022 2021
Non-current
Other provisions
0
1
Total 31/12 0 1
Specification, non-current
1/1 1 1
Reversed during the year -1
0
Provisions of the year
0
0
Total 31/12 0 1
Current
Restructuring costs
2
0
Total 31/12 2 0
Specification, current
1/1
0
1
Reversed during the year
0
-1
Provisions of the year
2
0
Total 31/12 2 0
Accounting policies
Provisions are measured in accordance with
managementās best estimate of the amount required to
settle a liability.
Restructuring expenses are recognised as liabilities
when a detailed official plan for the restructuring has
been published to the parties affected by the plan on
the balance sheet date at the latest.
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
116
Invested capital
3
3.8 Other payables
DKK million 2022 2021
Staff costs 139 130
Taxes and charges
52
101
Interest rate swaps
12
49
Other payables and amounts payable
40
36
Total 243 316
Accounting policies for derivative financial instruments are described in note 4.2 on interest-bearing liabilities and
maturity statement.
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
3.1 Intangible assets
3.2 Property, plant and equipment
3.3 Leases
3.4 Investments measured at equity value
and other non-current assets
3.5 Inventories
3.6 Trade receivables
3.7 Other provisions
3.8 Other payables
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Contents
117Solar A/S - Annual Report 2022
Financial Statements
Contents
Capital structure
and financing costs
Section 4
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
118
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Interest-bearing liabilities and
maturity statement
4.3 Financial income
4.4 Financial expenses
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Capital structure and financing costs
4
4.1 Share capital
DKK million 2022 2021
Share capital 1/1 736 736
Change in share capital
0
0
Share capital 31/12 736 736
Share capital is fully paid in and divided into the following classes:
A shares, 900,000 at DKK 100
90
90
B shares, 6,460,000 at DKK 100
646
646
Total 736 736
Number of shares Nominal value
2022 2021 2022 2021
A shares outstanding 31/12 900,000 900,000 90 90
B shares outstanding
Outstanding 1/1 6,403,187 6,398,292 640 640
Divestment of treasury shares 0 4,895 0 0
B shares outstanding 31/12 6,403,187 6,403,187 640 640
Total shares outstanding 31/12 7,303,187 7,303,187 730 730
Accounting policies
Treasury shares
Acquisition and disposal sums related to treasury shares
are recognised directly in transactions with the owners.
Treasury shares (B shares) Number of shares
Nominal value
(DKK million)
Cost
(DKK million)
Percentage
of share capital
2022 2021 2022 2021 2022 2021 2022 2021
Holding 1/1 56,813 61,708 6 6 22 24 0.7% 0.8%
Divestment 0 -4,895 0 0 0 -2 0.0% -0.1%
Holding 31/12 56,813 56,813 6 6 22 22 0.7% 0.7%
All treasury shares are held by the parent company.
Financial Statements
Solar A/S - Annual Report 2022
Contents
119
Capital structure and financing costs
4
4.2 Interest-bearing liabilities and maturity statement
DKK million Interest rate 2022 2021
Debt to mortgage credit institutions Fixed
1
204 129
Debt to credit institutions Fixed
1
100 0
Lease liabilities Calculated 77 78
Bank loans and overdrafts Floating 524 0
Interest-bearing liabilities 905 207
Trade payablesī 756 944
Other payables 243 316
Financial liabilities 1,904 1,467
Cash at bank and in hand 110 408
Trade receivables 555 441
Other receivables 223 303
Financial assets 888 1,152
Total, financial balance sheet items, net 1,016 315
1) Interest swaps have been used to hedge floating-rate loans, converting these loans to fixed-rate loans.
2) Solar participates in supplier financing arrangement with a few suppliers. As a result trade payables are
increased with approx. DKK 136m (DKK 239m).
Accounting policies
Financial liabilities
Debt to credit institutions is recognised initially at fair
value that corresponds to the proceeds received net of
transaction costs incurred.
In subsequent periods, the financial liabilities are
measured at amortised cost using the effective interest
method, meaning that the difference between the
proceeds and the nominal value is recognised in the
income statement under financials for the term of the
loan. For information on lease liabilities, see note 3.3.
DKK million 2022 2021
Interest-bearing liabilities 1/1 207 312
Repayment of non-current interest-bearing debt -12 -79
Raising of non-current interest-bearing liabilities 185 0
Change in current interest-bearing debt 525 -32
Instalment on lease liabilities -26 -25
Lease liability raised during the year, non-cash 27 30
Foreign currency translation adjustment -1 1
Interest-bearing liabilities 31/12 905 207
Reconciliation of development in interest-bearing debt to financing activities in the cash flow statement:
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Interest-bearing liabilities and
maturity statement
4.3 Financial income
4.4 Financial expenses
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
120
4.2 Interest-bearing liabilities and maturity statement ā continued
DKK million 2022 2021
Current interest-bearing liabilities
Maturity < 1 year
Debt to mortgage credit institutions 11 9
Lease liabilities 28 23
Bank loans and overdrafts 524 0
Current interest-bearing liabilities 563 32
Other financial liabilities 999 1,260
Financial liabilities 1,562 1,292
Current financial assets 888 1,152
Net current financial liabilities 674 140
Maturity 1-5 year(s)
Debt to mortgage credit institutions 45 32
Debt to credit institutions 100 0
Lease liabilities 41 40
Total 186 72
Maturity > 5 years
Debt to mortgage credit institutions 148 88
Lease liabilities 8 15
Total 156 103
Total non-current liabilities 342 175
Maturity, until year 2042 2037
The carrying amount of financial liabilities corresponds to fair value.
Capital structure and financing costs
4
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Interest-bearing liabilities and
maturity statement
4.3 Financial income
4.4 Financial expenses
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
121
4.2 Interest-bearing liabilities and maturity statement ā continued
Capital structure and financing costs
4
DKK million 2022 2021
Interest-bearing liabilities and maturity statement for expected interest expense
for the period
< 1 year 16 8
1-5 year(s) 41 26
> 5 years 47 29
Total 104 63
Effect of a 1% interest rate increase at the end of the year
Effect on equity 10 10
Of this, earnings impact is -4 0
Undrawn credit facilities 31/12 638 412
Accounting policies
Derivatives
Derivatives are only used to hedge financial risks in the
form of interest rate and currency risks.
Derivatives are recognised at fair value. Both realised and
unrealised gains and losses are recognised in the income
statement unless the derivatives are part of hedging of
future transactions. Value adjustments of derivatives for
hedging of future transactions are recognised directly in
other comprehensive income. Any non-effective part of
the financial instrument in question is recognised in the
income statement. Derivatives are recognised under other
receivables or other payables.
Fair value measurement
The group uses the fair value concept for recognition of
certain financial instruments and in connection with some
disclosure requirements. Fair value is defined as the price
that can be secured when selling an asset or that must
be paid to transfer a liability in a standard transaction
between market participants (exit price).
Fair value is a market-based and not enterprise-specific
valuation. The enterprise uses the assumptions that
market participants would use when pricing an asset or
liability based on existing market conditions, including
assumptions relating to risks.
As far as possible, fair value measurement is based on market
value in active markets (level 1) or alternatively on values
derived from observable market information (level 2).
If such observable information is not available or cannot
be used without significant modifications, recognised
valuation methods and fair estimates are used as the basis
of fair values (level 3).
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Interest-bearing liabilities and
maturity statement
4.3 Financial income
4.4 Financial expenses
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
122
Capital structure and financing costs
4
4.2 Interest-bearing liabilities and maturity statement ā continued
Distribution on currencies
Current liabilities Non-current liabilities
DKK million 2022 2021 2022 2021
EUR 127 8 111 120
DKK 408 1 182 0
SEK 0 0 0 0
Total 535 9 293 120
Interest rate in % 3.0-5.5 1.1-5.4 4.3-5.5 5.4
Fair value of Solarās respective interest-bearing
liabilities is seen as fair value measurement
at level 2. Mortgage loans are valued based
on underlying securities, while bank debt is
calculated based on models for discounting to
net present value. Non-observable market data is
primarily made up of credit risks, which are seen
as insignificant in Solarās case.
The fair value of Solarās interest rate instrument
is measured as fair value measurement at level 2,
since fair value can be determined directly based
on the actual forward rates and instalments on
the balance sheet date. Outstanding interest rate
swaps for hedging of floating-rate loans expire
over the period until 2042 (2037).
The parent company has raised loans in Danish
kroner and euro. We refer to the consolidated
accounts, note 4.3, interest-bearing liabilities
and maturity statement, for more information
on liquidity risk, interest rate and currency risk
management.
DKK million 2022 2021
Outstanding interest swaps made for hedging floating-rate loans
Principal amount 122 127
Interest rate in % for outstanding swaps 5.5 5.4
Fair value -12 -49
Maturity for interest swaps follows the maturity for debt to mortgage credit institutions
as stated on previous page.
Amounts recognised in other comprehensive income
Adjustment to fair value for the year 30 9
Realised during the year, recognised as financial income/expenses 6 20
Total 36 29
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Interest-bearing liabilities and
maturity statement
4.3 Financial income
4.4 Financial expenses
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
123
4.3 Financial income 4.4 Financial expenses
DKK million 2022 2021
Interest income 9 23
Foreign exchange gains 8 4
Fair value adjustments on investments 0 0
Other financial income 8 2
Total 25 29
Financial income, received 17 25
DKK million 2022 2021
Interest expenses 28 16
Foreign exchange losses 8 3
Interest on lease liabilities 1 1
Fair value adjustments, other financial investments 20 23
Other financial expenses 3 22
Total 60 65
Financial expenses, settled 32 39
Capital structure and financing costs
4
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
4.1 Share capital
4.2 Interest-bearing liabilities and
maturity statement
4.3 Financial income
4.4 Financial expenses
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Contents
124
Financial Statements
Solar A/S - Annual Report 2022
Contents
Other notes
Section 5
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
125
5.1 Contingent liabilities and other financial liabilities
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
5.1 Contingent liabilities
and other financial liabilities
5.2 Related parties
5.3 Auditorsā fees
Group companies overview
Statements and reports
Q4 2022
Other notes
5
DKK million 2022 2021
Collateral
Assets have been pledged as collateral for bank arrangements at a carrying amount of:
Land and buildings 274 190
Current assets 0 0
Total 274 190
Mortgaging and guarantees
As security of subsidiaries' bank arrangements, guarantees have been issued for:
Total 93 96
As security of subsidiaries' liabilites, guarantees have been issued for:
Total 654 493
Financial Statements
Solar A/S - Annual Report 2022
Contents
126
Other notes
5
5.2 Related parties
Group and parent Solar A/S are subject to control
by the Fund of 20th December (registered as a
commercial foundation in Denmark), which owns
17.0% of the shares and holds 60.5% of the voting
rights. The remaining shares are owned by a
widely combined group of shareholders.
Other related parties include the companyās
Board of Directors and Executive Board. There
have been no transactions in the financial year
with members of the Board of Directors and
Executive Board other than those which appear
from note 2.1.
The parent company has had the following
significant transactions with related parties:
5.3 Auditors' fees
DKK million 2022 2021
Deloitte
Statutory audit 1 1
Other assurance engagements
1
1 0
Other services
2
1 1
Total 3 2
Other auditors
Other services 0 0
Total 0 0
1) Other assurance engagements mainly consists of IT Cyber resilience and ESG assurance.
2) Other services mainly consists of Board effectiveness review and ESG readiness review
(2021: IT-related services and services related to business combinations).
DKK million 2022 2021
Sale of services to subsidiaries 162 150
Sale of goods to subsidiaries 165 138
Interst incomde from subsidiaries 7 4
Interst expense from subsidiaries 2 1
On the balance sheet date, the usual product
balances derived from these transactions exist.
These appear from the parent companyās balance
sheet.
Solar also invoices the Fund of 20th December
for the performance of administrative services
at DKK 20,000. Balances with the Fund of 20th
December total 0 on balance sheet date.
Consolidated financial statements
Separate financial statements
Statement of comprehensive income
Balance sheet
Cash flow statement
Statement of changes in equity
Notes
Section 1 ā Basis for preparation
Section 2 ā Income statement
Section 3 ā Invested capital
Section 4 ā Capital structure and financing costs
Section 5 ā Other notes
5.1 Contingent liabilities
and other financial liabilities
5.2 Related parties
5.3 Auditorsā fees
Group companies overview
Statements and reports
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
128
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Companies fully owned by Solar A/S Companies fully owned by Solar A/S ā continued
Name Reg. no. Currency Share capital Country
Associates
Monterra AB, 30.00% 559103-4847 SEK 50,000 SE
HomeBob A/S, 44.91% 38832840 DKK 5,511,195 DK
Zolw AS, 35.00% 925 003 328 NOK 48,000 NO
Edison Data AS, 20.00% 928 651 150 NOK 1.800.000 NO
Other financial investments
LetsBuild Holding SA, 8.09% 0656.613.388 EUR 30,457,207 BE
Minuba ApS, 19.98% 33259336 DKK 100,542 DK
SiteHub ApS, 20.00% 41823194 DKK 50,000 DK
Companies, where Solar's equity interest is less than 50%
Group companies overview
Financial Statements
Solar A/S - Annual Report 2022
Contents
130
Statement by the Executive Board and
the Board of Directors
EXECUTIVE BOARD
BOARD OF DIRECTORS
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Statement by the executive board and the
board of directors
Independent Auditors' report
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
131
Report on the consolidated financial
statements and the parent financial
statements
Independent auditorsā report
To the shareholders of Solar A/S
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Statement by the executive board and the
board of directors
Independent Auditors' report
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
132
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Statement by the executive board and the
board of directors
Independent Auditors' report
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
133
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Statement by the executive board and the
board of directors
Independent Auditors' report
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
134
Business Registration No 33963556
Identification No (MNE) mne10052
Identification No (MNE) mne32208
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Statement by the executive board and the
board of directors
Independent Auditors' report
Q4 2022
Financial Statements
Solar A/S - Annual Report 2022
Contents
136
Quarterly figures
Q1 Q2 Q3 Q4
Income statement (DKK million) 2022 2021 2022 2021 2022 2021 2022 2021
Revenue 3,462 3,004 3,451 3,098 3,266 2,872 3,684 3,380
Earnings before interest, tax, depreciation and amortisation (EBITDA) 281 204 267 211 301 237 326 259
Earnings before interest, tax and amortisation (EBITA) 236 157 218 166 250 192 274 212
Earnings before interest and tax (EBIT) 222 143 202 153 231 179 254 197
Financials, net -5 -20 -8 3 -6 -20 -31 -11
Earnings before tax (EBT) 217 123 193 156 225 159 223 184
Net profit or loss for the quarter 168 100 147 148 176 124 169 159
Consolidated
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Quarterly figures
Financial review
Statement of comprehensive income
Balance sheet
Cash flow statement
Segment information
Q1 Q2 Q3 Q4
Balance sheet (DKK million) 2022 2021 2022 2021 2022 2021 2022 2021
Non-current assets 1,487 1,342 1,557 1,385 1,545 1,393 1,564 1,415
Current assets 4,088 3,500 4,122 3,569 4,392 3,724 4,337 3,890
Balance sheet total 5,575 4,842 5,679 4,954 5,937 5,117 5,901 5,305
Equity 1,808 1,619 1,600 1,661 1,764 1,784 1,931 1,952
Non-current liabilities 453 498 506 457 491 446 709 435
Current liabilities 3,314 2,725 3,573 2,836 3,682 2,887 3,261 2,918
Interest-bearing liabilities, net 617 461 1,122 329 1,205 450 1,074 -37
Invested capital 2,377 2,011 2,675 1,921 2,923 2,185 2,978 1,866
Net working capital, end of period 1,791 1,344 1,856 1,280 2,186 1,568 2,205 1,259
Net working capital, average 1,475 1,300 1,619 1,274 1,773 1,325 2,010 1,363
Financial Statements
Solar A/S - Annual Report 2022
Contents
137
Quarterly figures
Q1 Q2 Q3 Q4
Cash ļ¬ows (DKK million) 2022 2021 2022 2021 2022 2021 2022 2021
Cash flow from operating activities -202 -88 -10 351 -14 -38 242 558
Cash flow from investing activities -109 -10 -75 -63 -37 -65 -38 -53
Cash flow from financing activities -37 -71 41 -271 66 77 -152 -250
Net investments in intangible assets -16 -13 -14 -15 -12 -14 -17 -16
Net investments in property, plant and equipment -59 8 -61 -47 -25 -51 -22 -35
Acquisition and disposal of subsidiaries, net -34 0 0 0 0 0 0 0
Consolidated ā continued
Q1 Q2 Q3 Q4
Financial ratios (% unless otherwise stated) 2022 2021 2022 2021 2022 2021 2022 2021
Revenue growth 15.2 -1.3 11.4 12.9 13.7 9.7 9.0 10.6
Organic growth 15.4 -2.2 11.7 10.6 14.0 8.8 10.9 9.1
Organic growth adjusted for number of working days 13.6 -0.6 12.4 8.6 14.0 8.8 12.0 7.1
Gross profit margin 23.1 21.9 22.9 22.0 24.1 23.0 23.6 22.9
EBITDA margin 8.1 6.8 7.7 6.8 9.2 8.3 8.8 7.7
EBITA margin 6.8 5.2 6.3 5.4 7.7 6.7 7.4 6.3
EBIT margin 6.4 4.8 5,9 4,9 7,1 6.2 6.9 5.8
Net working capital (NWC end of period)/revenue (LTM) 14.0 11.8 14.1 10.9 16.1 13.0 15.9 10.2
Net working capital (NWC average)/revenue (LTM) 11.5 11.4 12.3 10.8 13.1 11.0 14.5 11.0
Gearing (interest-bearing liabilities,net/EBITDA), no. of times 0.6 0.7 1.1 0.4 1.1 0.5 0.9 0.0
Return on equity (ROE) 31.9 17.6 35.1 18.2 38.6 19.7 35.7 28.4
Return on invested capital (ROIC) 26.5 16.6 25.5 21.0 25.3 23.6 25.5 24.6
Enterprise value/earnings before interest, tax and amortisation (EV/EBITA) 7.5 7.6 6.3 7.0 5,2 7.6 5.7 7.8
Equity ratio 32.4 33.4 28.2 33,5 29,7 34,9 32.7 36.8
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Quarterly figures
Financial review
Statement of comprehensive income
Balance sheet
Cash flow statement
Segment information
Financial Statements
Solar A/S - Annual Report 2022
Contents
138
Quarterly figures
Q1 Q2 Q3 Q4
Share ratios (DKK unless otherwise stated) 2022 2021 2022 2021 2022 2021 2022 2021
Earnings per share outstanding (EPS) 23.00 13.70 20.13 20.27 24.10 16.98 23.14 21.77
Intrinsic value per share outstanding 247.56 221.68 219.08 227.43 241.54 244.28 264.41 267.28
Share price 749.19 480.82 597.09 541.47 492.34 632.86 622.62 795.05
Share price/intrinsic value 3.03 2.17 2.73 2.38 2.04 2.59 2.35 2.97
Consolidated ā continued
Q1 Q2 Q3 Q4
Employees 2022 2021 2022 2021 2022 2021 2022 2021
Average number of employees (FTE's) continuing operations 2,932 2,897 2,956 2,889 2,992 2,890 3,019 2,908
Definitions
Organic growth Revenue growth adjusted for enterprises acquired and sold off and any exchange rate changes. No adjustments have been made for number of working days.
Net working capital Inventories and trade receivables less trade payables.
ROIC Return on invested capital calculated on the basis of operating profit or loss less tax calculated using the effective tax rate.
In all material aspects financial ratios are calculated in accordance with the Danish Finance Society's "Recommendations & Financial Ratios".
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Quarterly figures
Financial review
Statement of comprehensive income
Balance sheet
Cash flow statement
Segment information
Financial Statements
Solar A/S - Annual Report 2022
Contents
139
Q4 EBITDA increased by more
than 25% to DKK 326m
Financial review
(Data shown in brackets relate to the corresponding period in 2021)
Q4 adjusted organic growth
increased to 12.0% (7.1%)
while gross profit margin
rose to 23.6% (22.9%).
Q4 EBITDA of DKK 326m
(DKK 259m) was supported
by positive developments
in all markets.
Revenue
Revenue increased to DKK 3.7bn (DKK 3.4bn).
Adjusted organic growth level rose to 12.0% (7.1%)
with one of our strategic focus areas, Climate
& Energy, delivering adjusted organic growth
of 116%, which corresponds to total revenue of
approx. DKK 438m.
Although growth was supported by price increases,
we continued to see growth in volume. The
Installation segment posted 6% in adjusted organic
growth while the Industry and Trade segments
posted double-digit adjusted organic growth.
Gross profit
Gross profit margin increased to 23.6% (22.9%),
which combined with revenue growth, resulted in
a gross profit increase of DKK 95m. One-off price
effects resulted in a positive impact of approx. DKK
70m (DKK 35m) on gross profit. Adjusted for price
effects, the gross profit margin decreased by 0.2
percentage points as revenue mix changed towards
the trade segment.
External operating costs
and staff costs
In total, external operating costs and staff costs
amounted to 14.5% (15.1%) of revenue. Rising
prices, including energy prices, had a negative
effect on cost development. Increased costs were
also driven by strong performance.
EBITDA
We succeeded in increasing EBITDA by DKK 67m.
This was driven by our four strategic focus areas,
Concepts, Industry, Climate & Energy and Trade,
positive one-offs and a strong growth level.
The EBITDA margin rose to 8.8% (7.7%) as EBITDA
increased to DKK 326m (DKK 259m), which slightly
exceeded our expectations.
The results of the individual segments and markets
are given on pages 145-146.
Amortisation and impairment
Depreciation and write-down on property, plant
and equipment increased to DKK 52m (DKK 47m) as
we began to see the effect from the investment in
expansion and upgrade of Warehouse Vejen.
Financials
Net financials amounted to DKK -31m (DKK -11m) as
a negative fair value adjustment of DKK 17m related
to an investment was applied in Q4 2022.
Gross profit margin
%
EBITDA
DKKm
Q2Q1
Q3 Q4
2021
2022
204
281
211
267
237
301
259
326
Q2Q1
Q3 Q4
2021
21.9
23.1
22.0
22.9
23.0
24.1
22.9
23.6
2022
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Quarterly figures
Financial review
Statement of comprehensive income
Balance sheet
Cash flow statement
Segment information
Financial Statements
Solar A/S - Annual Report 2022
Contents
140
Earnings before tax
Earnings before tax amounted to DKK 223m (DKK
184m).
Income tax
Income tax amounted to DKK 54m (DKK 25m). In
Q4 2021, tax loss carried forward amounting to
DKK 32m was capitalised due to the improved
performance of both MAG45 and Solar Nederland.
Net profit
Net profit increased to DKK 169m (DKK 159m).
Cash flows
Net working capital calculated as an average of
the previous four quarters amounted to 14.5%
(11.0%) of revenue. Net working capital at the
end of 2022 amounted to 15.9% (10.2%).
Cash flow from operating activities totalled DKK
242m (DKK 558m).
Changes in receivables had an impact of DKK
177m (DKK 221m) on cash flow mainly due to a
higher growth level in December 2022 compared
to December 2021.
Changes in non-interest-bearing liabilities and
changes in inventories had a cash flow impact of
DKK -84m (DKK 286m) and DKK -67m (DKK -145m)
respectively.
The availability of stock materials improved in
the latter part of 2022. However, the availability
of certain products, especially relating to the
Industry segment, remains challenged. In Q4
2022, our inventory level was affected by the
decision to safeguard delivery performance
during a period of potential goodsā shortage but
also by price increases. We expect the inventory
level to start normalising during 2023.
Cash flow from receivables was affected by the
increased growth level in Q4 2022.
Total cash flow from investing activities
amounted to DKK -38m (DKK -53m).
Cash flow from financing activities amounted to
DKK -152m (DKK -250m), mainly due to a change
in current interest-bearing liabilities.
Consequently, total cash flow amounted to DKK
52m (DKK 255m).
Net interest-bearing liabilities were up at DKK
1,074m (DKK -37m).
At the end of 2022, gearing was 0.9 (0.0) times
EBITDA. When adjusted for one-off impact,
gearing amounted to 1.1 times EBITDA. Our
gearing target is between 1.5-3.0 times EBITDA.
The Board of Directors continually assesses the
capital structure in relation to our target and the
need for capital.
At the end of 2022, Solar had undrawn credit
facilities of DKK 710m.
Invested capital
Invested capital for the Solar Group totalled
DKK 2,978m (DKK 1,866m). ROIC amounted to
25.5% (24.6%). Activities with a Solar equity
interest of less than 50% are not included in the
ROIC calculation. Invested capital only includes
operating assets and liabilities.
Financial review - continued
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Quarterly figures
Financial review
Statement of comprehensive income
Balance sheet
Cash flow statement
Segment information
Financial Statements
Solar A/S - Annual Report 2022
Contents
141
All segments delivered
strong growth in Q4
Installation
Our Installation segment covers the installation of
electrical, heating and plumbing products.
In Q4, Installation revenue increased to DKK 2,067m
(DKK 2,023m) which corresponds to overall adjusted
organic growth of around 6% (3%) related primarily
to the electrical business. All main markets saw
growth in the segment, with Solar Norge making a
significant contribution.
Segment profit increased to DKK 270m (DKK 245m)
which corresponds to a segment profit margin of
13.1% (12.1%) positively affected by an increased
gross profit margin.
Industry
This segment covers the industry, offshore
and marine industries as well as utilities and
infrastructure. Industry also includes MAG45.
In Q4, Industry revenue increased to DKK 1,166m
(DKK 1,063m). This corresponds to overall adjusted
organic growth of around 13% (10%) related
primarily to Marine & Offshore, OEM and MRO
although Utility also saw solid growth. Solar Sverige,
Solar Norge and MAG45 posted growth above 15%.
Segment profit increased to DKK 220m (DKK 184m).
This corresponds to a segment profit margin of
18.9% (17.3%).
Trade
Our Trade segment covers special sales and other
small areas. It also includes Solar Polaris.
In Q4, revenue from Trade amounted to DKK 451m
(DKK 294m) which corresponds to overall adjusted
organic growth of around 50% (27%).
Segment profit amounted to DKK 58m (DKK 48m)
which corresponds to a segment profit margin of
12.9% (16.3%). This was negatively affected by a
decline in gross profit margin.
Segment profit includes any items that are
directly attributable to the individual segment
and any items that can be reliably allocated to
the individual segment.
Segment profit does not include non-allocated
costs of DKK 222m (DKK 218m) in Q4, which
cover income and costs related to joint group
functions and to costs which cannot be reliably
allocated to the individual segment.
Detailed segment information is given on page
145.
Installation
Industry
Trade
270
220
58
Installation
Industry
Trade
2,067
1,166
451
Q4
2022
Q4
2022
Installation
Industry
Trade
270
220
58
Installation
Industry
Trade
2,067
1,166
451
Q4
2022
Q4
2022
Revenue Segment profit Segment margin %
DKK million 2022 2021 2022 2021 2022 2021
Installation 2,067 2,023 270 245 13.1 12.1
Industry 1,166 1,063 220 184 18.9 17.3
Trade 451 294 58 48 12.9 16.3
Solar Group 3,684 3,380 548 477 14.9 14.1
Segment revenue
DKKm
Segment profit
DKKm
Financial review - continued
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Quarterly figures
Financial review
Statement of comprehensive income
Balance sheet
Cash flow statement
Segment information
Financial Statements
Solar A/S - Annual Report 2022
Contents
142
Income statement
Q4
DKK million 2022 2021
Revenue 3,684 3,380
Cost of sales -2,815 -2,606
Gross profit 869 774
Other operating income and costs -1 0
External operating costs -110 -85
Staff costs -426 -425
Loss on trade receivables -6 -5
Earnings before interest, tax, depreciation and amortisation (EBITDA) 326 259
Depreciation and write-down on property, plant and equipment -52 -47
Earnings before interest, tax and amortisation (EBITA) 274 212
Amortisation and impairment of intangible assets -20 -15
Earnings before interest and tax (EBIT) 254 197
Share of net profit from associates 0 -2
Financial income 16 9
Financial expenses -47 -20
Earnings before tax (EBT) 223 184
Income tax -54 -25
Net profit for the period 169 159
Earnings in DKK per share outstanding (EPS) 23.14 21.77
Diluted earnings in DKK per share outstanding (EPS-D) 23.07 21.71
Statement of comprehensive income
Other comprehensive income
Q4
DKK million 2022 2021
Net profit for the period 169 159
Items that can be reclassified for the income statement
Foreign currency translation adjustment of foreign subsidiaries -3 6
Fair value adjustment of hedging instruments before tax 1 3
Other income and costs recognised after tax -2 9
Total comprehensive income for the period 167 168
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Quarterly figures
Financial review
Statement of comprehensive income
Balance sheet
Cash flow statement
Segment information
Financial Statements
Solar A/S - Annual Report 2022
Contents
143
Consolidated
31.12
DKK million 2022 2021
Assets
Intangible assets 173 159
Property, plant and equipment 963 885
Right-of-use assets 383 300
Deferred tax assets 9 13
Investments in associates 4 5
Other non-current assets 32 53
Non-current assets 1,564 1,415
Inventories 2,248 1,855
Trade receivables 1,859 1,502
Income tax receivable 13 0
Other receivables 9 6
Prepayments 42 46
Cash at bank and in hand 166 481
Current assets 4,337 3,890
Total assets 5,901 5,305
31.12
DKK million 2022 2021
Equity and liabilities
Share capital 736 736
Reserves -181 -158
Retained earnings 1,047 1,045
Proposed dividend for the financial year 329 329
Equity 1,931 1,952
Interest-bearing liabilities 293 120
Lease liabilities 274 203
Provision for deferred tax 133 101
Other provisions 9 11
Non-current liabilities 709 435
Interest-bearing liabilities 556 19
Lease liabilities 117 102
Trade payables 1,902 2,098
Income tax payable 63 33
Other payables 604 644
Prepayments 2 1
Other provisions 17 21
Current liabilities 3,261 2,918
Liabilities 3,970 3,353
Total equity and liabilities 5,901 5,305
Balance sheet
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Quarterly figures
Financial review
Statement of comprehensive income
Balance sheet
Cash flow statement
Segment information
Financial Statements
Solar A/S - Annual Report 2022
Contents
144
Consolidated
Q4
DKK million 2022 2021
Net profit for the period from continuing operations 169 159
Depreciation, write-down and amortisation 72 62
Changes to provisions and other adjustments 0 9
Share of net profit from associates 0 2
Financials, net 31 11
Income tax 54 25
Financial income, received 6 4
Financial expenses, settled -20 -9
Income tax, settled -96 -67
Cash flow before working capital changes 216 196
Working capital changes
Inventory changes -67 -145
Receivables changes 177 221
Non-interest-bearing liabilities changes -84 286
Cash flow from operating activities 242 558
Investing activities
Purchase of intangible assets -17 -16
Purchase of property, plant and equipment -22 -35
Aquisition of associates 0 -2
Other financial investments 1 0
Cash flow from investing activities -38 -53
Cash flow statement
Q4
DKK million 2022 2021
Financing activities
Repayment of non-current, interest-bearing debt -6 -2
Raising of non-current interest-bearing liabilities 185 0
Change in current interest-bearing debt -301 -219
Instalment on lease liabilities -30 -29
Cash flow from financing activities -152 -250
Total cash flow 52 255
Cash at bank and in hand at the beginning of period 114 226
Cash at bank and in hand at the end of period 166 481
Cash at bank and in hand at the end of period
Cash at bank and in hand 166 481
Cash at bank and in hand at the end of period 166 481
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Quarterly figures
Financial review
Statement of comprehensive income
Balance sheet
Cash flow statement
Segment information
Financial Statements
Solar A/S - Annual Report 2022
Contents
145
Segment information
Income statement (DKK million) Installation Industry Trade Total
Q4 2022
Revenue 2,067 1,166 451 3,684
Cost of sales -1,599 -852 -364 -2,815
Gross profit 468 314 87 869
Direct costs -69 -35 -10 -114
Earnings before indirect costs 399 279 77 755
Indirect costs -129 -59 -19 -207
Segment profit 270 220 58 548
Non-allocated costs -222
Earnings before interest, tax,
depreciation and amortisation (EBITDA) 326
Depreciation and amortisation -72
Earnings before interst and tax (EBIT) 254
Financials, net including share of net profit from associates
and impairment on associates -31
Earnings before tax (EBT) 223
Income statement (DKK million) Installation Industry Trade Total
Q4 2021
Revenue 2,023 1,063 294 3,380
Cost of sales -1,597 -787 -222 -2,606
Gross profit 426 276 72 774
Direct costs -59 -36 -10 -105
Earnings before indirect costs 367 240 62 669
Indirect costs -122 -56 -14 -192
Segment profit 245 184 48 477
Non-allocated costs -218
Earnings before interest, tax,
depreciation and amortisation (EBITDA)
259
Depreciation and amortisation -62
Earnings before interst and tax (EBIT) 197
Financials, net including share of net profit from associates
and impairment on associates
-13
Earnings before tax (EBT) 184
Solarās business segments are Installation, Industry and Trade and are based on the
customersā affiliation with the segments. Installation covers installation of electrical, and
heating and plumbing products, while Industry covers industry, offshore and marine, and
utility and infrastructure.Trade covers other small areas. The three main segments have
been identified without aggregation of operating segments.
Segment income and costs include any items that are directly attributable to the individual
segment and any items that can be reliably allocated to the individual segment. Non-
allocated costs refer to income and costs related to joint group functions. Assets and
liabilities are not included in segment reporting.
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Quarterly figures
Financial review
Statement of comprehensive income
Balance sheet
Cash flow statement
Segment information
Financial Statements
Solar A/S - Annual Report 2022
Contents
146
Q4
DKK million Revenue
Adjusted
organic growth EBITDA
EBITDA
margin
Non-current
assets
2022
Sweden 726 4.1 59 8.1 192
Norway 625 23.4 58 9.3 220
The Netherlands 922 18.4 70 7.6 333
Poland 115 -13.9 4 3.5 36
Several markets (MAG45) 211 21.9 14 6.6 50
Other markets 53 88.9 5 9.4 30
Eliminations -105 - 0 - -1,800
Solar Group 3,684 12.0 326 8.8 1,564
Q4
DKK million Revenue
Adjusted
organic growth EBITDA
EBITDA
margin
Non-current
assets
2021
Denmark 1,063 8.0 105 9.9 1,988
Sweden 747 6.6 50 6.7 200
Norway 528 0.2 43 8.1 177
The Netherlands 804 3.6 43 5.3 335
Poland 133 51.1 5 3.8 27
Several markets (MAG45) 178 19.1 9 5.1 56
Other markets 19 3.6 4 21.1 4
Eliminations -92 - 0 - -1,372
Solar Group 3,380 7.1 259 7.7 1,415
Geographical information
Solar A/S primarily operates on the Danish, Swedish, Norwegian and Dutch markets. In
the below table, Other markets covers the remaining markets, which can be seen in the
companies overview available on page 128.
The below allocation has been made based on the productsā place of sale.
ā continued
Segment information
Consolidated financial statements
Separate financial statements
Group companies overview
Statements and reports
Q4 2022
Quarterly figures
Financial review
Statement of comprehensive income
Balance sheet
Cash flow statement
Segment information
Tel. +45 79 30 00 00
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http://www.linkedin.com/company/solar-as