2022
ANNUAL REPORT
20 March 2023
14 March 2022
ELECTRIC
Future
Magnora creates, develops, and invests in clean energy
companies that benefit from our combination of funding
and support. We look across segments and markets for
early stage opportunities and we aim to sell when a
project is ready-to-build.
ELECTRIC
Future
Magnora creates, develops, and invests in clean energy
companies that benefit from our combination of funding
and support. We look across segments and markets for
early stage opportunities and we aim to sell when a
project is ready-to-build.
ELECTRIC
Future
Magnora creates, develops, and invests in clean energy
companies that benefit from our combination of funding
and support. We look across segments and markets for
early stage opportunities and we aim to sell when a
project is ready-to-build.
ELECTRIC
Future
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Content
INTRODUCTION
CEO and Chairman’s Statement
4
Key Portfolio Figures
5
Board of Directors’ Report
6
Board Of Directors’ Statement On Policy For Corporate Governance
22
Board Of Directors
27
Senior Management
28
ESG
Sustainability
29
FINANCIALS
Magnora Group Consolidated Statement of Profit or Loss
30
Magnora Group Consolidated Statement of Comprehensive Income
31
Magnora Group Consolidated Statement of Financial Position
32
Magnora Group Consolidated Statement of Changes in Equity
34
Magnora Group Consolidated Cash Flow Statement
35
Magnora Group Notes to the Consolidated Financial Statements
36
Magnora ASA Income Statement
65
Magnora ASA Balance Sheet
66
Magnora ASA Cash Flow Statement
67
Magnora ASA Notes to the Financial Statements
68
Magnora Remuneration Report 2022
81
Independent Auditor's Report
87
Responsibility Statement
96
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CEO AND CHAIRMAN’S
Statement
A year of marvel
Looking back at 2022, it is easy to
feel energised. Our optimism relates
back to five rapid changes that
have proven our strategy and
business model.
First, the fundamental outlook on
energy has shifted. A few years ago,
renewable energy was the right
thing to do, but not necessarily a
profitable proposal. During 2022,
carbon free energy came five years
closer. Renewable assets turned out
to be profitable and the influx of
professional money grew. Magnora
benefitted through a healthy
capital increase, but also from a
new sense of urgency among
regulators. In Norway, solar power is
no longer a far-fetched idea and
Hafslund Magnora Sol saw a
marked shift in the willingness to offer
land in return for a future cut of
revenues. Energy is no longer just
energy – it matters where the energy
comes from and how it was
produced.
Gradually at first, then rapidly, an
industry architecture has emerged
that greatly benefit Magnora. A
decade ago, renewable energy
was mostly a play inside vertically
integrated companies. In recent
years, these giants have increasingly
come to rely on specialists in the
entrepreneurial early stages of a
project. A market has emerged for
ready-to-build projects with
observable standards and price
levels. Hence, our portfolio
companies spend less time
educating the market and more
time creating value. Helios Nordic
Energy AB, our Swedish solar PV
project developer for example,
delivered beyond expectation.
Thirdly, we experience an
entrepreneurial shift in the outlook
of energy majors. The large
companies that dominate energy
supply are capable of running
large and complex projects, but
may not master the high-speed,
high-risk business of sorting out
early-stage renewable projects.
Frequently, such projects require a
speed of execution beyond the
capacity of a major corporation.
Magnora has become a partner in
demand. In 2022 Hafslund Vekst
took an ownership stake in the
Group. TechnipFMC and Magnora
won the ScotWind N3 495 MW
floating wind license (aka “Talisk”)
in early 2022. Our portfolio
company Evolar AB (enhancing
solar cells) is also meeting
increased interest from much larger
partners.
At the end of 2022, our risk profile
looks very different from previous
years. Magnora is no longer
dependent on the performance of
individual ventures or key
individuals. Rather, we see a
diversified portfolio logic at work.
Magnora may shift attention onto
businesses that face challenges
and shift resources onto those that
face opportunities. Geographical
risk is also diversified through our
presence in South Africa, Norway,
Sweden, Scotland and England.
We have a portfolio of battery
storage, solar and wind assets,
some offshore and some onshore.
No single segment or market can
risk the health of the business.
A final shift is internal to Magnora:
the shift to pure play green
electricity. Since 2019, Magnora
has invested and operated
exclusively in renewable energy, as
the oil and gas business with all
technology rights was sold in 2018.
Two license agreements remain in
the Group, providing late revenues
from a proprietary design. From
2022 onward, however, renewable
portfolio is also generating cash.
We expect green revenues to
exceed legacy revenue during
2023.
Finally, we would like to underpin
that we depend on, and have
been very fortunate to attract, a
team of industry-leading experts
from the renewable industry, which
has allowed us to select the right
investments and manage them
efficiently and in a competitive way.
Diversification coupled with a
professional team is what allows us to
quickly choose the best project
opportunities and to create value.
On our way to a carbon neutral
Europe, we believe green energy
prices will stay higher than in the
previous decades for many years to
come.
The future is bright
and green.
Torstein Sanness
Executive chairman
Erik Sneve
CEO
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BOARD OF
Directors’ Report
MAIN EVENTS IN 2022
Figures for 2021 are presented
in parenthesis.
The Group continued to grow in
2022. During the year, a series of
significant events played out:
» On 17 January 2022, Crown
Estate Scotland offered
Magnora Offshore Wind (MOW)
an Option Agreement for area
N3 (part of ScotWind). MOW
plans to establish
approximately 495 MW of
capacity and start production
in 2030. The agreement was
signed in early April 2022. In
December 2022, the Office of
Gas and Electricity Market
published a proposal for a link to
Beauly by 2030 that would
greatly benefit the Magnora
Offshore Wind project now
named Talisk.
» In February 2022, the Group
acquired 92 percent of African
Green Venture (AGV), a
company developing
renewable projects in South
Africa. The local AGV team is
constantly seeking to expand its
portfolio of project sites.
» In March 2022, the Group
partnered with an experienced local
developer to enter the UK Solar
PV and battery storage market.
» In April 2022, the Group exercised
its option to increase ownership
in Evolar to 63.5%. Evolar has
kept reaching its cell efficiency
targets, while negotiating
business opportunities with
industrial partners and
customers. Interest from external
financial and industrial investors
has allowed Evolar to consider
various financial alternatives
with a focus both on return for
Magnora’s shareholders and
continued industrial progress.
» In July 2022, the Group secured
NOK 100 million in longer term
financing through two top tier
Nordic banks. This replaced a
facility of NOK 50 million, while
the other loan facility of NOK 50
million was maintained. Total
loan facility is NOK 150 million.
» In August 2022, the Group and its
partners in Neptun Tromsø
decided to move forward with
developing a green maritime
fuel production facility in Tromsø.
The company has signed LOIs
with Posten Bring (national
postal company) and other
potential customers for the
green ammonia from the
planned facility.
» The Group received its first
dividend from Helios in August.
This significant milestone came
less than 18 months after our first
investment into Helios. Helios
closed its last transaction for the
year in December having sold
projects with a future capacity
of 577 MW in 2022. The
company continued to grow its
portfolio, which totaled 82
projects and 2.3 GW at the end
of 2022. Potential new sales can
be expected in the near term.
» In September 2022, the Group
raised a total of NOK 200 million
at a price of NOK 22.35 per
share, of which NOK 100 million
was pre-allocated to Hafslund.
The private placement was
seven times oversubscribed.
» In September 2022, the Group
also concluded an agreement
with Hafslund and Helios to
establish a solar PV
development company for the
Norwegian market.
» In December 2022, a vessel
based on a legacy Magnora
design left the yard, triggering
recognition of USD 7.5 million
milestone revenues for our
legacy design. The revenue is
reflected as a receivable as of
the end of the year and was
received in February 2023. This
was the second of four
milestone payments. The
remaining are expected in 2023
or early 2024.
» Increase in operating revenue
combined with a slight increase
in corporate operating
expenses gave an EBITDA of
NOK 10.5 million (negative NOK
38.5 million).
» Net profit was NOK 3.9 million
(negative NOK 62.8 million). The
increase was mainly driven by
higher operating revenues.
Expenses from project
development and M&A
activities also increased during
the year and a reduction in the
deferred tax asset was
recognised at year end in line
with IFRS rules. The entry has no
effect on our cash position. Not
including the non-cash
expenses of options, write-
down of deferred tax asset, and
profit/loss from associated
companies, the net profit was
NOK 21.7 million for 2022.
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FINANCIALS
Figures for 2021 are presented in
parentheses.
The Group operates with two
segments: Corporate and Projects.
Revenues and expenses from their
respective business activities are
tracked separately.
Magnora share of the financial
results from each portfolio
company is recognized in
proportion to ownership share in
accordance with IFRS. For
subsidiaries, the full net profit/loss is
recognised as these companies
are consolidated into the Group’s
financial reports. The development
costs in these companies are
expensed, not capitalised,
reflecting their early development
phase.
CORPORATE
The Corporate segment consists of
the corporate staff and represents
the cost base of the Group. All
licensing revenues from legacy oil
and gas contracts are managed
and reported as part of the
corporate segment.
Operating revenue for the
corporate segment was NOK 102.6
million (NOK 18.7 million) and
operating expenses NOK 30.6
million (NOK 30.8 million). The
increase in operating revenue is
mainly due to the milestone
payment of USD 7.5 million from the
Shell Penguins project. EBITDA was
NOK 72 million (negative NOK 12.5
million) for the corporate segment.
PROJECT
The project segment consists of the
portfolio companies, projects, and
all related activities. Development
and M&A related expenses are
assigned to the project segment,
excluding M&A related expenses
for acquisitions that have not
materialised. These expenses are
assigned to the corporate
segment.
There was NOK 0.3 million from
subsidiaries in operating revenues
in the project segments. Most
projects are early-phase and not
yet generating revenues.
Operating expense was NOK 1.2
million (NOK 3.5 million), and
development and M&A expense
was NOK 60.6 million (NOK 22.4
million) in the project segment. The
increase in development and M&A
expense is mainly due to higher
ownership and increased activity
level in subsidiaries and associated
companies. EBITDA was negative
61.5 million (negative NOK 26
million) for the project segment.
CONSOLIDATED
Operating revenues for the year
ended at NOK 91.7 million, up from
NOK 15.2 million last year, mainly
due to achievement of the second
milestone of USD 7.5 million in the
Shell Penguins project. Future
revenues from our license
agreements will depend on the
timing of production drilling,
currency rates, maintenance,
uptime and more.
Adjusted EBITDA ended at NOK
10.5 million (negative NOK 38.5
million). EBITDA result has been
positively affected by higher
operating revenues as noted
above, although development
and M&A expense has increased
significantly due to higher activity
level and consolidating more
entities than in 2021. As the Group
invests in more companies and
projects and increases its
ownership share in existing
investments, the Group’s share in
the negative financial results from
the investments will increase. This is
only accounting effects but does
affect the financial results of the
Group. Net profit for 2022 was NOK
3.9 million (negative NOK 62.8
million). Not including the non-cash
expenses of options, write-down of
deferred tax asset, and profit/loss
from associated companies, net
profit was NOK 21.7 million for 2022.
Earnings per share was negative
NOK 0.02 (negative NOK 1.11 in
2021).
Profit before tax was NOK 12 million
(negative NOK 55.1 million), mainly
affected by higher operating
revenues as noted above.
The Group has accumulated tax
losses of over NOK 3.5 billion.
CASH FLOW
As of 31 December 2022, cash and
cash equivalents amounted to
NOK 171.9 million (NOK 96.9 million).
Net cash from operating activities
was negative NOK 67.7 million. Net
cash from investment activities was
negative NOK 125.3 million, and net
cash from financing activities was
NOK 268.0 million. The net cash flow
for the year was NOK 75 million. The
positive cash flow was mainly due
to the equity private placement
and operating revenues from the
Dana contract, reduced by the
investments and loans to
subsidiaries and associated
companies.
FINANCING AND FINANCIAL
POSITION
As of year-end 2022, total assets
amounted to NOK 564.2 million
(NOK 192.7 million) whereof cash
and cash equivalents amounted to
NOK 171.9 million (NOK 96.9 million).
Total equity as of 31 December
2022 amounted to NOK 431.8
million (NOK 171.8 million), and the
equity ratio was 77 percent (89
percent).
The Group had NOK 76.3 million
(NOK 0) in interest-bearing debt as
of 31 December 2022.
SHARE BUYBACK AND
DIVIDENDS
Distribution of quarterly dividends
to shareholders was approved at
the annual general meeting held
on 26 April 2022.
Distribution of quarterly dividends
to shareholders has been halted to
conserve cash for investments in
line with the Group’s near-term
strategy.
Magnora has approximately NOK
8.4 billion (NOK 159 per share) of
paid-in capital in excess of par
value available for distribution of
equity back to its shareholders.
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On 16 January 2019, Magnora
initiated a share buyback program.
The buyback program is carried out
by market purchases in
accordance with the authorisation
granted by the extraordinary
general meeting to the Board of
directors on 18 December 2018.
Buyback transactions are
executed according to the market
price on the Oslo Stock Exchange.
Extension of the share buyback
program was approved by
shareholders at the annual general
meeting held on 26 April 2022.
Magnora may at any time without
further notice close or suspend the
program. The maximum number of
shares which may be purchased in
any one day is limited to 50 percent
of the average weighted daily
volume of Magnora shares traded
in the 20 trading days preceding
the day of purchase. No Magnora
shares were purchased during
2022, and as of the date of this
report, Magnora owns 21,866
shares or 0.03 percent of total
shares outstanding.
GOING CONCERN
In accordance with section 3-3(a)
of the Norwegian Accounting Act,
the Board confirms that the annual
accounts have been prepared on
a going concern assumption,
which the Board believes is
appropriate based on the
company’s strategic plans and
financial prognosis.
ANNUAL RESULTS AND YEAR-
END APPROPRIATIONS
The Board proposes the following
appropriation of the annual profit
of NOK 70.5 million in the parent
company Magnora ASA:
»
Transfer from other equity at
end of year Balance Sheet 31
December 2022: NOK 70.5
million
»
Total appropriation: NOK 70.5
million
RISK AND UNCERTAINTY
FACTORS
Magnora is exposed to market risk,
electricity price risk, in-direct
equipment price risk, customer risk,
project risk, reservoir risk, credit risk,
currency risk, renewable license
risk, concession risk, interest rate risk,
inflation risk, liquidity risk, climate
risks, regulatory risks, and other
indirect risks. The Group’s overall risk
management programme focuses
on the uncertainty of financial
markets and seeks to minimise
potential adverse effects on its
financial performance.
The Company selects its portfolio
projects and companies with
emphasis on diversification to
mitigate the various inherent risks in
each segment of the renewable
energy production industry. This
does not reduce the individual risks
below but makes the Group less
vulnerable to the effects of those
risks.
The project development process
for renewable energy plants is also
exposed to risks. The process for
obtaining concession from relevant
authorities can vary in different
countries, but most countries have
required local acceptance, and in
some countries the local
municipality has veto rights. The
public opinion and local
municipality veto rights can affect
the licensing decisions and has in
some countries caused changes to
the political process determining
the regulatory framework for
obtaining concession for building
and operating renewable energy
plants. These uncertainties can
cause delays and rejection of the
concession applications, and it can
cause the economics of the
projects to be worsened as the
approved size of turbines may not
be sufficient for an optimised wind
park. There are also risks related to
military installations and training
areas in addition to wildlife risks.
The profitability and viability of
projects can be influenced by
outside factors, such as the global
transportation constraints during
the past months, and the war in
Ukraine.
These types of events can have
various effects on project costs,
access to materials, transportation,
and other goods and services
relying on the same.
Market price of electricity can
influence the profitability and value
of Magnora’s investments. The
price of electricity is influenced by
government subsidies, supply and
demand, availability of alternative
energy sources (oil, coal, natural
gas, nuclear plants, etc.),
development cost and cost of
equipment for power plants, and
efficiency improvements within
renewable energy plants (wind
and solar for Magnora). One
significant influencing factor in
electricity prices is the political
developments pushing for
renewable energy to take over for
the use of fossil fuels and the
shutting down of nuclear plants.
Although Magnora’s remaining
legacy customers are two major
companies with a strong financial
basis, as with suppliers and
customers in general, there is a risk
that unforeseen financial difficulties
on the counterparty’s side may
arise and cause material adverse
effects on the financial condition,
cash flows and/or prospects of
Magnora.
The Group is also subject to
currency, field development and
reservoir risk in situations where our
legacy design is employed by
customers in the oil and gas
industry. The company and its
group companies may sell project
prior to ready to build, there is a risk
that projects will never receive all
permits needed to be finalised and
customers might require a new
project delivered. If not possible,
we may need to return part of pre-
payments.
Competition is significant as
companies in other industries are
trying to benefit from the positive
policy support from governments
pushing for improvements in CO
2
emissions. Several companies
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Magnora competes with are parts
of larger groups, with better access
to key personnel and funding.
The recent Covid-19 virus could
potentially affect revenues for a
short period if the crew on vessels
involved in the use of our legacy
design is dismissed due to infection
risk or similar.
The global climate appears to be
changing, and the average
temperature is predicted to rise
globally, causing more extreme
weather conditions, and impacting
habitat. Governments are now
focusing on reaching a net zero
world, which is aligned with the
Group’s strategy of investing in
renewable energy projects and
companies developed in a
sustainable way. The Group has
evaluated climate risk and
concluded that the overall effect
on the Group’s financial results is
positive as the value of assets
increases due to the increased
demand for renewable energy.
Regulatory risks can be changes in
the regulatory environment that
have a material adverse effect on
Magnora’s operations and
financial performance. This could
be changes in renewable energy
policies, tax policies, or the
regulatory environment that could
affect the industries the Group
operates in. Changes in the
licensing regulations can for
instance cause delays in
development and construction of
projects.
The Group derive all its cash flow
from financial investments, two
legacy agreements and its
subsidiaries and associated
companies. Negative cash flow
and lack of financial performance
from those companies therefore
affects the Group. The exposure is
limited to the Group’s invested
amount in those companies and is
closely linked to the companies’
ability to execute its strategy and
manage risk. Magnora is
represented on all boards of its
subsidiaries and associated
companies and mitigates risks
through normal governance
processes.
Liquidity and access to capital is a
risk now that the Group is investing
in more capital-intensive projects.
This is managed through close
dialogues with financial institutions
and a strict timeline for cash flow
that matches future investment
payments with investment gains
from farm-downs and exits. As a
mitigating measure, the Group has
replaced a shorter-term overdraft
facility with a NOK 100 million loan
facility with longer term and has a
total of NOK 150 million in loan
facilities.
Loss of key personnel is a risk to the
Group as it operates with a staff of
highly specialised professionals that
may take time to replace if
needed. Mitigation of this risk is an
ongoing process of identifying
outsourcing alternatives and
potential recruitment to cover the
resource needs of the Group.
Sales of projects prior to the ready-
to-build phase and final payments
are typically closed when all
permits, grid connections and/or
equipment and long lead items are
secured. The full payment of a
project sale might be at risk
depending on the exact contract
terms. Lack of progress in a project
can lead to a project sale being
cancelled if we or a group
company are unable to replace it
with an alternative project.
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Sustainability
Magnora’s business is a sustainable business. We find compelling
investment opportunities in businesses that contribute to the circular
economy. Globally and within EU and Norway, there are a
number of initiatives and policies aimed at making the
economy greener and sustainable. The EU aims for a carbon
neutral economy by 2050. EU also has a mid term target stating
that 32% of all energy consumed within the region shall be
derived from green and sustainable resources by 2030. More
information about Magnora’s sustainable development goals
can be found on the Group’s website: www.magnoraasa.com
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CORPORATE
GOVERNANCE
The Group aims at maintaining
sound corporate governance
routines that provide the basis for
long term value creation to the
benefit of shareholders,
employees, other stakeholders and
society at large.
As a guiding basis for its conduct of
corporate governance, the Group
uses the national Norwegian Code
of Practice for Corporate
Governance, of 14 October 2021.
The status of corporate
governance is addressed on page
23 of this report.
THE BOARD OF DIRECTORS
Magnora had its annual general
meeting on 26 April 2022, and the
annual general meeting elected
the following members to the
Board of Directors: Torstein Sanness
(Chairperson, re-elected), John
Hamilton (Director, re-elected),
Hilde Ådland (Director, re-
elected). Presentations of the
Directors are available in a
separate chapter in this Annual
Report and on the Group’s
website: www.magnoraasa.com
CORPORATE SOCIAL
RESPONSIBILITY
HEALTH, SAFETY AND
ENVIRONMENT
Developing sound health, safety
and environment (HSE) principles is
a critical success factor for the
Group.
Sick leave was 1.18% (2021: 0%) for
the Group for the year. No serious
work incidents or accidents
resulting in personal injuries or
damages to materials or
equipment occurred in 2022. There
were no Lost Time Incidents (LTI)
during 2022.
The work environment is positive,
and the Board and management
continue to focus on equal
opportunities for men and women.
One of three Board members at
year-end was female. The Group
strives to ensure that there is no
discrimination due to gender,
ethnicity, national origin, descent,
race, religion or functional
disability. Currently, the Group has
not implemented any specific
measures in order to meet the
objective of the Discrimination Act
and of the Anti-discrimination and
Accessibility Act. The need for
specific measures in this respect is
continuously considered by the
Board and management.
ANTI-CORRUPTION
The Group has implemented
formal guidelines, procedures,
standards and routines in relation
to anti- bribery and corruption in
Magnora and its portfolio
companies.
HUMAN RIGHTS
The Group has implemented
formal guidelines, procedures,
standards or routines regarding
human rights.
THE NORWEGIAN
TRANSPARENCY ACT
The Group has implemented
formal guidelines, procedures,
standards, and routines for due
diligence as required by the OECD
Guidelines for Multinational
Enterprises. Further information
about this is available on the
Group’s website:
www.magnoraasa.com
Oslo, Norway, 20 March 2023
The Board of Directors of Magnora ASA
Torstein Sanness
Chairman
Hilde Ådland
Board member
John Hamilton
Board member
Erik Sneve
CEO
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BOARD OF DIRECTORS’ STATEMENT ON POLICY FOR
Corporate Governance
CORPORATE GOVERNANCE
IN MAGNORA
As a listed company on the main
board of Oslo Stock Exchange
(Oslo Børs), the Group aims to
conduct its business in accordance
with the Norwegian Code of
Practice for Corporate
Governance of 14 October 2021
(the “Code of Practice”). The
Company’s principles of corporate
governance are in addition to the
Code of Practice based on the
Continuing Obligations of stock
exchange listed companies from
the Oslo Børs and relevant
Norwegian background laws such
as the Norwegian Accounting Act
and the Norwegian Public Limited
Liability Companies Act. The Code
of Practice may be found at
www. nues.no and the Continuing
Obligations of stock exchange
listed companies may be found at
www. euronext.com/en/markets/oslo.
In addition to this foundation, the
Company has established a set of
principles (see
www.magnoraasa.com) aimed at
ensuring openness, integrity, and
equal treatment of its shareholders.
By practicing good corporate
governance, appropriate division
of roles between shareholders, the
Board of Directors and Senior
Management will be secured,
thereby contributing to reduced
business risk and better shareholder
value over time.
The Group is committed to high
ethical standards in its business
dealings to ensure that the integrity
of its employees and the
organisation is maintained.
Corporate social responsibility for
the Group is an extension of the
way the Group conducts its
business.
In accordance with section 3-3 b of
the Norwegian Accounting Act,
the Group shall in connection with
its annual financial statements
provide a statement on how the
Group has implemented the
principles of, and account for any
deviations from, the Code of
Practice. Below is an outline on the
Group’s principles for corporate
governance, in accordance with
the categories listed in the Code of
Practice. At the turn of the year
2022/23, the Group deviates from
the Code of Practice on the
following point:
» The Board of Directors has so far
chosen not to adopt or publish any
explicit guiding principles for how it
will act in the event of a takeover
bid (Section 14; Takeovers).
BUSINESS
The Group’s objective, as set out in
§ 3 of the Group’s articles of
association (the “Articles”), is “the
conduct of industry, trade and
business associated with energy, IT
and commodities, and sectors
directly or indirectly related to
these, in addition to investments in
and acquisitions of businesses,
securities, financial instruments and
other assets, and participating in
other businesses, directly or
indirectly linked to these”.
The Board of Directors is of the
opinion that the business objectives
laid down in the Articles provide
predictability and direction for the
Group’s business strategy and the
activities that it may conduct,
acquire, or initiate. The Articles are
available at the Group’s website.
The Board of Directors has defined
clear objectives, strategies and risk
profiles for the Group’s business
activities such that the Group
creates value for shareholders in a
sustainable manner. The Board of
Directors considered financial,
social and environmental
consideration when they carried
out this work. The Board of Directors
annually evaluates the Group’s
objectives, strategies and risk
profiles.
EQUITY AND DIVIDEND
The Group seeks to maintain a
healthy financial structure which is
adjusted to its business as well as
the duration of its contract
portfolio. As of 31 December 2022,
the Group had an equity share
ratio of 77 percent.
The Board of Directors continually
reviews and ensures that the Group
has a capital structure that is
appropriate to the Group’s
objectives, strategies, and risk
profile. The Board of Directors has
established and disclosed a
dividend policy, which is
considered clear and predictable.
Authorisations granted to the Board
of Directors to increase the
Company’s share capital will
normally be restricted to defined
purposes and will in general be
limited in time to no later than the
date of the next Annual General
Meeting. The background to any
proposal for the Board of Directors
to be given an authorization to
approve the distribution of
dividends will be explained.
At the annual general meeting
held on 26 April 2022, shareholders
approved capital distribution to
shareholders. No distributions were
performed in 2022 as capital
distributions have been halted to
retain funds needed for additional
investments and development of
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the Group’s portfolio of companies
and projects.
On 16 January 2019, Magnora
initiated a share buyback program.
The buyback program is carried out
by market purchases in
accordance with the
authorisations granted by the
general meeting.
Buyback transactions are
executed according to the market
price on the Oslo Stock Exchange.
Extension of the share buyback
program was approved by
shareholders at the annual general
meeting held on 21 May 2019, and
again on 26 May 2020, 27 April
2021, and 26 April 2022. Magnora
may at any time without further
notice close or suspend the
program. No Magnora shares were
purchased during 2022 and as of
the date of this report Magnora
owns 21,866 shares, or 0.03 percent
of total shares outstanding. Please
also see “equal treatment of
shareholders” below.
EQUAL TREATMENT OF
SHAREHOLDERS AND
TRANSACTIONS WITH
CLOSE ASSOCIATES
The Group has one class of shares
only and each share entitles the
holder to one vote at the Group’s
annual general meetings.
All shareholders shall be treated on
an equal basis unless there is a just
cause for treating them differently
in accordance with applicable
laws and regulations. In the event
of an increase in share capital of
the Company through issuance of
new shares, a decision to waive the
existing shareholders’ pre-emptive
rights to subscribe for shares shall be
justified. If the Board of Directors
resolves to issue new shares and
waive the pre-emptive rights of
existing shareholders pursuant to a
Board authorization granted by the
general meeting, the justification
shall be publicly disclosed in a stock
exchange announcement issued in
connection with the shares issue.
The reasons for any deviation from
equal treatment of all shareholders
in capital transactions will be
included in the stock exchange
announcement made in
connection with the transaction.
Any transactions carried out by the
Company in the Company’s own
shares shall be carried out through
Oslo Børs and in any case at
prevailing stock exchange prices. If
there is limited liquidity in the
Company’s shares, the Company
shall consider other ways to ensure
equal treatment of shareholders.
Any transactions in own shares will
be evaluated in relation to the rules
on the duty of disclosure, as well as
in relation to the prohibition against
illegal insider trading and market
manipulation, the requirement for
equal treatment of all shareholders,
and the prohibition of unreasonable
business methods.
TRANSACTION WITH
CLOSE ASSOCIATES
Transactions with close associates
shall be on arm’s-length basis and
always in compliance with the
Norwegian Public Limited Liability
Companies Act. The Board of
Directors will arrange for a
valuation to be obtained from an
independent third party unless the
transaction, agreement or
arrangement in question is
immaterial or covered by the
provisions of section 3-16 of the
Norwegian Public Limited Liability
Companies Act.
The Group may engage in business
activities with or in cooperation
with its shareholders. Such activities
shall be handled at the board level,
with a view of securing a
foreseeable and consistent
practice which prevents potential
conflict of interest situations, arm’s-
length treatment, and sound
governance.
Directors, the CEO, and members
of Senior Management shall notify
the Board of Directors in advance if
they have a significant interest in
any agreement which may or is to
be entered into by the Group.
For more information about
transactions with related parties,
please refer to note 23 of the
consolidated financial statements
of this report.
FREELY NEGOTIABLE
SHARES
The Group’s shares are listed on
Oslo Børs and are freely negotiable.
There are no restrictions on
transferability of shares pursuant to
the Articles.
GENERAL MEETINGS
The annual general meeting is the
Group’s supreme corporate body.
The Articles and the Norwegian
Public Limited Liability Companies
Act set out the authority and
mandate of the annual general
meeting.
Among other things, the annual
general meeting approves the
Group’s annual financial
statements, elects the Directors
and the auditor, and functions as a
forum for presentation and
discussion of other issues of general
interest to shareholders. The calling
notice for the annual general
meeting will ensure that the
resolutions and supporting
information distributed are
sufficiently detailed,
comprehensive, and specific to
allow shareholders to form a view
on all matters to be considered at
the meeting.
All shareholders of the Group have
the right to attend the annual
general meetings. Shareholders will
normally be able to vote on each
individual matter, including each
individual candidate nominated
for election to the Board of
Directors, the Nomination
Committee and any other
corporate bodies to which
members are elected by the
general meeting.
The Board of Directors ensures that
the members of the Board of
Directors and the chairperson of
the Nomination Committee attend
the annual general meeting.
Further, the Board of Directors
ensures that the annual general
meeting can elect an independent
chairperson for the general
meeting.
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The date of the annual general
meeting is published in the Group’s
financial calendar for the year,
which is posted at the Group’s
website. Notice of annual general
meetings, including
documentation relating to the
items on the agenda and the
recommendation of the Group’s
nomination committee, is in
accordance with the Articles
published at the Group’s website
no later than 21 days before the
annual general meeting is to be
held. Individual shareholders are
entitled to have the documents
sent to them free of charge, upon
request to the Group. The annual
general meetings of the Group
may be held in Oslo or Bærum,
Norway.
Attendance forms for the annual
general meeting may be sent to
the Group up to the day before
such annual general meeting to
enable as many shareholders as
possible to attend. Shareholders
who are unable to attend in person
may attend by proxy, and the
Group provides the shareholders
with proxy forms which enable the
relevant shareholder to instruct its
representative on each individual
item on the agenda.
The shareholders may decide
between granting proxy to a
representative of their own choice,
or to the Chairperson of the Board.
The minutes from the annual
general meeting are published on
the Group’s website as soon as
possible following the annual
general meeting.
NOMINATION COMMITTEE
The Nomination Committee is
elected by the general meeting
and currently consists of three
members.
The Nomination Committee works
under the mandate and authority
of the annual general meeting,
prepares, and recommends
candidates for the annual general
meeting’s election of members of
the Board of Directors and
members of the Nomination
Committee.
The Nomination Committee is
encouraged to have contact with
shareholders, the Board of Directors
and the Company’s executive
personnel as part of its work on
proposing candidates for election
to the Board of Directors. Its
recommendations will normally be
explained. It also proposes the
remuneration to the Directors.
The Nomination Committee is
governed by a provision in the
Articles and Guidelines for the
Nomination Committee adopted
by the annual general meeting.
The annual general meeting has
stipulated guidelines for the duties
of the Nomination Committee,
elects the chairperson and
members of the Nomination
Committee and determines the
remuneration of the members of
the Nomination Committee.
Information regarding the
composition of the Nomination
Committee, which members are up
for election and how input and
proposals can be submitted to the
Nomination Committee are posted
on the Group’s website prior to the
annual general meeting.
CORPORATE ASSEMBLY
AND BOARD OF
DIRECTORS
As of the date hereof, the Group is
not required to and does not have
a Corporate Assembly.
The Board of Directors is composed
in a way that meets the Group’s
need for expertise, capacity, and
diversity, and with the aim of
ensuring that the Board of Directors
can attend to the common
interests of all shareholders and
operate independently of any
special interests and function
effectively as a collegial body.
The Board of Directors shall
pursuant to the Articles consist of
three to seven members. All
members shall be elected by the
annual general meeting. The
Chairperson is elected by the
annual general meeting. The Board
of Directors currently consists of
three members: Torstein Sanness
(Chairperson), John Hamilton and
Hilde Ådland. Presentations of the
Directors are available in a
separate chapter in this Annual
Report and on the Group’s website.
Members of the Board of Directors
serve for a two-year period, or such
shorter period as decided by the
General Meeting, but directors
may be re- elected.
The directors are deemed to be
independent of the Group’s main
shareholders and material business
contacts. At least two of the
shareholder-elected members of
the Board of Directors shall be
independent of the Company’s
main shareholder(s). The Board of
Directors does not include
executive personnel.
The members of the Board of
Directors are encouraged to own
shares in the Company. Information
on the Directors’ shareholdings in
the Group, their expertise and
information on their attendance at
board meetings is set out on the
Group’s website and note 18 of the
Consolidated Financial Statements.
In addition, the Consolidated
Financial Statement identifies
which members are considered
independent.
THE WORK OF THE BOARD
OF DIRECTORS
The Board of Directors is ultimately
responsible for administering the
Group’s affairs and for ensuring
that the Group’s operations are
organised in a satisfactory manner.
Moreover, the Board of Directors is
responsible for establishing
supervisory systems and for
overseeing that the business is run in
accordance with the Group’s core
values and ethical guidelines.
The Board of Directors prepares an
annual plan for its work, with
emphasis on objectives, strategies,
and implementation. Furthermore,
the Board of Directors approves the
budget for the Group.
The Group maintains a directors
and officers liability insurance
policy (D&O) for a maximum
liability of NOK 75 million.
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The Board of Directors meets
minimum six times a year and more
frequently if required. The Board of
Directors held 16 board meetings in
2022, of which 4 were physical
board meetings and the rest were
held online. The average
participation level was 100%. To
ensure a more independent
consideration of matters of a
material character in which the
Chairman of the Board of Directors
is, or has been, personally involved,
such matters will be chaired by
some other member of the Board
of Directors.
The Board of Directors will consider
appointing a Remuneration
Committee to ensure thorough and
independent preparation of
matters relating to compensation
paid to the executive personnel.
Membership of such committee will
be restricted to members of the
Board who are independent of the
Company’s executive personnel.
The Board of Directors evaluates its
performance and expertise
annually.
AUDIT COMMITTEE
The Board of Directors established
an Audit Committee in 2010, which
acts as a preparatory and advisory
working committee regarding the
financials of the Group. The Audit
Committee further assists the Board
of Directors in various matters
relating to the Group’s financial
statements, financial reporting
processes and internal controls,
and the qualifications,
independence, and performance
of the external auditor. The
members of the Audit Committee
receive additional remuneration
for duties relating to the committee
responsibilities, such remuneration
being subject to approval by the
annual general meeting. Currently,
the members of the audit
committee are Torstein Sanness
and John Hamilton.
RISK MANAGEMENT AND
INTERNAL CONTROL
The Board of Directors ensures that
the Group has sound internal
control functions and appropriate
systems for risk management
tailored to the extent and nature of
its operations and in accordance
with the Group’s core values,
ethical guidelines and social
responsibility policy. A review of the
Group’s most important risk areas
and its internal control functions is
conducted by the Board of
Directors on an annual basis.
The Group is exposed to a variety of
risks, including market risks,
currency risks, financial risks, and
operational risks. The Group’s
overall risk management
programme seeks to minimise the
potential adverse effects on the
Group’s financial performance
likely to be caused by its exposure
to such risk factors, including but
not limited to the use of derivative
financial instruments and
development of sound health,
safety, and environment (HSE)
principles as well as prudent
monitoring of activities.
The Group prepares and publishes
quarterly and annual financial
statements. The Group’s
consolidated financial statements
are prepared in accordance with
IFRS and IFRIC interpretations as
adopted by the EU.
REMUNERATION OF THE
BOARD OF DIRECTORS
The remuneration of the members
of the Board of Directors reflects the
Board’s responsibilities, expertise,
time commitment and the
complexity of the Company’s
activities. The remuneration is
determined on a yearly basis by the
annual general meeting. The
Directors are also reimbursed for
travelling, hotel and other expenses
incurred by them in attending
board meetings or in connection
with the business of the Group.
Remuneration of the Board of
Directors, as proposed by the
Nomination Committee and
approved by the annual general
meeting, is not linked to the
Group’s performance. In
accordance with approval by the
Annual General Meeting of 26 April
2022, the Board of Magnora issued
475,000 options during 2022 to
provide long-term incentives to the
Board and the Management team.
The details regarding these awards
are described in note 13 to the
Group’s consolidated financial
statements. The Company
currently does not grant share
options to the members of the
Board of Directors.
Members of the Board of Directors
and/or companies with which they
are associated will normally not
take on specific assignments for the
Group in addition to their
appointment as a member of the
Board of Directors. If they
nonetheless do take on such
assignments, this must be disclosed
to the full Board of Directors. The
remuneration for such additional
duties shall be approved by the
Board of Directors. Details of the
remuneration to the Board of
Directors are disclosed in note 18 to
the Group’s consolidated financial
statements, included in the 2022
Annual Report. Any remuneration
in addition to normal director’s fee
is also specifically identified in the
annual report.
REMUNERATION OF THE
SENIOR MANAGEMENT
The Board of Directors has
established guidelines for the
remuneration of the members of
Senior Management. These
guidelines are presented to and
approved by the annual general
meeting and are described in the
“Magnora Remuneration Report
2022” which is disclosed on page 87
of the 2022 Annual Report.
The guidelines on salary and other
remuneration for the Senior
Management are clear and easily
understandable and they
contribute to the Group’s
commercial strategy, long-term
interests and financial viability.
The Group’s arrangements in
respect of salary and other
remuneration shall help ensure the
Senior Management and
shareholders have convergent
interests and are simple. The
performance-related
remuneration to executive
personnel is subject to an absolute
limit.
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INFORMATION AND
COMMUNICATION
The Board of Directors has
established guidelines for the
Group’s reporting of financial and
other information based on
openness and consider the
requirements for equal treatment
of all participants in the securities
market.
In order to ensure equal treatment
of its shareholders, an important
objective for the Group is to make
sure the securities market is in
possession of correct, clear and
timely information about the
Group’s operations and condition
at all times. This is essential for an
efficient pricing of the Group’s
shares and for the market’s
confidence in the Group. Initiatives
taken to meet this equal treatment
objective include timely and
comprehensive reporting of the
Group’s interim results and
publication of the annual and
quarterly financial reports. In
addition, information of
significance for assessing the
Group’s underlying value and
prospects are reported through
Oslo Børs and are made available
at the corporate website. Further
details, such as contact details and
general updates and news about
the Group, are available at the
Group’s website.
The Group’s CEO is responsible for
investor relations and the Group
seeks to provide relevant and
updated information to its
shareholders, Oslo Børs, analysts
and investors in general. The Group
seeks to clearly communicate its
long-term potential, including its
strategy, value drivers and risk
factors. The Board of Directors has
further established guidelines for
the Company’s contract with
shareholders beyond the scope of
General Meetings.
The Group’s financial calendar is
available at the Group’s website.
Updated shareholder information is
published at the website.
TAKEOVERS
The Board of Directors will handle
any possible takeover in
accordance with Norwegian
corporate law and its fiduciary
duties. Neither the Articles of
Association nor any underlying
steering document prevent or limit
the opportunity for investors to
acquire shares in the Group, nor do
they impose restrictions relative to
takeover attempts or authorise
measures to be taken by the Board
of Directors to interfere.
The Board of Directors will not seek
to hinder or obstruct an offer for the
Group’s activities or shares unless
there are reasons for this. The Board
of Directors has so far chosen not to
adopt or publish any explicit
guiding principles for how it will act
in the event of a takeover bid.
AUDITOR
Ernst & Young AS (EY) was elected
external auditor in 2013. The auditor
participates regularly in meetings
with the Audit Committee
throughout the year. In addition,
the Board of Directors meets with
the auditor, without any member of
the Group being present, at least
once a year to deal with the
annual accounts.
The Board of Directors makes sure
that the auditor submits the main
features of the plan for the audit to
the Audit Committee annually. The
auditor presents at least annually a
review of the Group’s internal
control procedures, including
identifying weaknesses and
proposals for improvement to the
Board of Directors.
In connection with the issue of the
auditor’s report, the auditor
provides the Board of Directors with
a declaration of independence
and objectivity, and the auditor
participates in the board meeting
in which the annual financial
statements are approved. The
proposal for approval of the
remuneration of the auditor
provides a breakdown of
remuneration relating to statutory
audit tasks and other assignments
and is reported to the annual
general meeting.
At meetings where the annual
accounts are dealt with, the
auditor shall report on any material
changes in the Group’s
accounting principles and key
aspects of the audit, comment on
any material estimated accounting
figures and report all material
matters on which there has been
disagreement between the auditor
and the executive management of
the Company.
The Board of Directors has
established guidelines in respect of
the use of the auditor by the
Company’s executive
management for services other
than the audit
Oslo, Norway, 20 March 2023
The Board of Directors of Magnora ASA
Torstein Sanness
Chairman
Hilde Ådland
Board member
John Hamilton
Board member
Erik Sneve
CEO
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BOARD OF
Directors
EXECUTIVE CHAIRMAN
Mr. Sanness is a Norwegian citizen
residing in Norway, with extensive
experience and technical expertise
in the oil and gas industry. Mr. Sanness
served as managing director of
Lundin Petroleum Norway from 2004
to April 2015, whereafter he was
elected Chairman of the same
company until March 2017 when he
moved to the board of International
Petroleum Corp., another Lundin
Group company.
Under his leadership Lundin Norway
turned into one of the most successful
players on the Norwegian
Continental Shelf and added net
discovered resources of close to a
billion boe to its portfolio. Before
joining Lundin Norway, Mr. Sanness
was Managing Director of Det Norske
Oljeselskap AS.
From 1975 to 2000, Mr. Sanness was at
Saga Petroleum where he held
executive positions in Norway, and
the US, including responsibility for
Saga’s international operations and
entry into Libya, Angola, Namibia,
and Indonesia.
Mr. Sanness is a graduate of the
Norwegian Institute of Technology in
Trondheim where he obtained a
master’s degree in engineering
(geology, geophysics, and mining
engineering).
Mr. Sanness also serves as a board
member for International Petroleum
Corp., Lundin Energy AB, Carbon
Transition ASA, and Panoro Energy
ASA.
BOARD MEMBER
Mrs. Ådland holds a bachelor’s
degree in chemical engineering and
a master’s in Process Engineering has
extensive experience from various
technical and operational positions
in Kværner, Statoil and Gas de
France/GDF Suez/ Engie/Neptune.
Mrs. Ådland is currently working in
Vår Energi as Vice President of
Norwegian Sea Area. Mrs. Ådland is
also a board member of Panoro
Energy ASA and serves as the
chairman of the board of NOFO
(the Norwegian Clean Seas
Association for Operating
Companies).
BOARD MEMBER
Mr. Hamilton has considerable
experience from various positions in
the international oil and gas
industry. Most recently, John was
Chief Executive Officer of UK AIM
listed President Energy PLC, a Latin
American focused exploration
company, which opened a new
onshore basin in Paraguay.
Before joining President, John was
Managing Director of Levine Capital
Management, an oil and gas
investment fund. He was also Chief
Financial Officer of UK FTSE 250 listed
Imperial Energy PLC, until its sale for
over US$ 2 billion in 2008.
John spent 15 years with ABN
AMRO Bank in Europe, Africa, and
the Middle East. Most of his time with
ABN AMRO was spent in the energy
group, with a principal focus on
financing upstream oil and gas.
John has a BA from Hamilton
College in New York, and an MBA
from the Rotterdam School of
Management and New York
University. Today, John holds the
position as CEO of Panoro ASA.
Torstein Sanness
Hilde Ådland
John Hamilton
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SENIOR
Management
Mr. Sneve has considerable experience from various positions in the in the investment industry and renewable industry
in Norway and abroad. Mr. Sneve has worked 25 years with investments and operationally in the VC industry,
renewable industrial and in a family office in various positions and support services.
His experience from working as an analyst, consultant, COO and investment director is from EY, DnB Markets, Energy
Future Invest (EFI – a Statkraft, Hafslund and Eidsiva Energi joint-venture) and for Fram. He has worked internationally in
the US, Sweden, Germany and opened offices in the UK and Sri Lanka. He was also responsible for the Solibro AB (a
Swedish solar technology company) development and sale to Q-cells AG, a Euro 84 million exit as an Investment
Director in EFI.
Mr. Sneve has also worked as a COO in an early-stage 3D software company building an international organization
working within the mobile telephony and health care industries. Mr. Sneve holds a B.Sc. in finance from Arizona State
University with Summa Cum Laude (Dean’s List).
Bård Olsen has several years of experience from various controller positions in the US. He has also worked as an external
auditor at Henry & Horne, and internal auditor and responsible for regional SOX compliance at the NYSE listed
dealership group Auto Nation.
Mr. Olsen has also worked at EY in a risk and internal control advisory role for banks and financial institutions in Oslo,
Norway. Before joining Magnora, Mr. Olsen was Vice President of Global Compliance at MHWirth, a drilling equipment
company within the Aker Group, and held various positions within the group during the nine years there, including
Head of Internal Audit at Aker Solutions corporate. Mr. Olsen holds a B.Sc. in Finance and an MBA from Arizona State
University.
Erik Sneve | CEO
Bård Olsen | CFO
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Sustainability
Magnora’s core business is to
facilitate renewable energy. We
create value by helping de-risk and
speed up renewable energy
solutions, such as wind -and solar
power. Our strategy is to develop
projects from early phase
greenfield to ready-to-build. Our
contribution is through developing
renewable energy projects through
the early stages to de-risk the
projects and get all necessary
permits and licenses in place as
efficiently as possible. This allows
larger and established energy
companies to move swiftly into
renewables and quickly enter
construction phase.
We are fortunate to have a core
business with a direct and positive
impact on some essential
sustainable development goals
(SDGs). Our team is focused on
growing our portfolio and
managing our resources through
channeling funds to the projects
generating more megawatts for
customers needing green energy.
Avoiding bottlenecks and finding
locations without serious
environmental impact is also key.
We do this because it is profitable,
but also because it has a material
and positive impact on our
environment.
Our team brings decades of
experience with proven operating
and project execution models,
leveraged as we support our
portfolio companies building a
presence within the wind and solar
power industries. We strive to
educate a wide network of
partners making our model useful in
various geographical markets.
We operate in countries and
environments where focus on
ethical business is essential. The risk
of fraud and unethical practices
are higher in some jurisdictions. We
mitigate such practices through risk
assessments, standards, extensive
due diligence work, and a strong
commitment to local stakeholders
of our projects. It is critical for long-
term value of all projects that trust
and mutual benefits are built with
landowners, local and national
authorities, local communities and
NGOs.
Magnora supports the UN
Sustainable Development Goals
(SDGs) and has identified three
goals where we can make a
difference:
SDG 7
Ensure access to affordable,
reliable, sustainable and modern
energy for all. According to the UN,
an estimated 789 million people
lacked electricity in 2018. Solutions
for generating more electricity is
viewed as important for
developing better living conditions
and better opportunities for a large
group of people. Moreover, the
need for renewable energy is of
course important to lower global
emissions.
SDG 9
Build resilient infrastructure,
promote inclusive and sustainable
industrialization, and foster
innovation. Building new
infrastructure for generation of
renewable energy will enable
existing industry to become more
sustainable by replacing fossil and
nuclear energy sources with
renewable energy. Some of our
power generation facilities are
likely to be located closer to the
end consumer, which will increase
efficiency as less energy is lost in
transmission.
SDG 13
Take urgent action to combat
climate change and its impacts.
According to the UN, investment in
fossil fuels continues to be higher
than investment in climate
activities. By investing in renewable
energy solutions that support the
drop in global emissions, Magnora
makes a positive contribution to
combat the climate change. This is
important as climate change
continues to exacerbate the
frequency and severity of natural
disasters, and according to the UN,
affected more than 39 million
people in 2018.
Magnora has developed a
governance framework to ensure
our expectations to our
stakeholders are communicated
clearly through all relevant
channels. Implementation of our
governance framework includes
training for our board and
employees, as well as
implementation of specific
guidance and tools. We hire
people based on our assessment of
their experience and attitude to
ensure they will promote our values
and safety mechanisms that
ensures the well-being of our
employees, partners, and
contractors.
Although challenging with a small
team and specialist-focused hiring,
we are actively pursuing gender
diversity when hiring and
promoting, and we have a zero
tolerance for any form of
discrimination. Our whistleblowing
channel is established to ensure
employees, partners, and
contractors can report their
concerns if violation of our code of
conduct is suspected.
Although our current
environmental impact is primarily
through our investment choices,
we believe our values will have
long- term effects on the projects
we build and invest in throughout
their lifecycles.
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 30
MAGNORA ASA | Q4 REPORT 2022
Alternative
Performance
Measures
The European Securities and Markets Authority (ESMA) issued guidelines on Alternative Performance Measures
(“APMs”) that came into force on 3 July 2016. Magnora has defined and explained the purpose of the following APMs:
EBITDA
EBITDA, as defined by Magnora, includes total operating revenue, and excludes profit/loss from associated
companies, depreciation, amortization, and impairment loss.
ADJUSTED EBITDA
Adjusted EBITDA is a measurement used in internal reporting to management and is considered to also be relevant
for external stakeholders. Adjusted EBITDA shows the corporate activities and related expenses to operate the Group.
This has been referred to as the Groups’ cost base in previous reports. Adjusted EBITDA, as defined by Magnora,
excludes development and M&A related expenses, and non-cash items and adjustments, such as options related
expenses. Development and M&A related expenses are expenses related to investment transactions and
development of projects.
NOK million
2022
2021
Operations
Total operating revenue
91.7
15.2
Employee benefit expense
-32.1
-20.4
Other operating expense
-47.5
-33.3
EBITDA
12.0
-38.5
Development and M&A expense
49.4
22.9
Share-based payments (non-cash)
5.8
3.4
Adjusted EBITDA
67.2
-12.2
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 31
MAGNORA ASA | Q4 REPORT 2022
MAGNORA GROUP CONSOLIDATED STATEMENT OF PROFIT OR LOSS
NOK million
Note
2022
2021
Operating revenue
24
91.1
13.8
Other operating revenue
24
0.6
1.4
Total operating revenue
91.7
15.2
Depreciation, amortization and impairment
-1.6
0.0
Employee benefit expense
18
-32.1
-20.4
Profit/loss from associated companies
7
-3.9
-21.6
Other operating expense
26
-47.4
-33.3
Total operating expense
-85.0
-75.3
Operating profit/(loss)
6.7
-60.1
Financial income
19
8.1
22.4
Financial expense
19
-10.2
-17.4
Foreign exchange gain/(loss)
7.4
0.0
Net financial profit/(loss)
5.3
5.0
Profit/(loss) before tax
12.0
-55.1
Tax income/(expense)
15
-8.1
-7.7
Annual net profit/(loss)
3.9
-62.8
Profit attributable to:
Note
2022
2021
Net profit/(loss) attributable to equity holders
12.5
-62.8
Net profit/(loss) attributable to non-controlling
interests
-8.6
0.0
Earnings per share for profit/(loss) attributable to the equity holders of the Company during the year (NOK per
share):
Basic
20
0.21
-1.11
Diluted
20
0.21
-1.11
MAGNORA GROUP CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
NOK million
2022
2021
Net profit/(loss)
3.9
-62.8
Foreign currency translation to be classified to profit or loss in
subsequent period
1.9
-2.3
Total comprehensive income
5.8
-65.1
Total comprehensive income attributable to equity holders
13.5
-65.1
Total comprehensive income attributable to non-controlling
interest
-7.7
0.0
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 32
MAGNORA ASA | Q4 REPORT 2022
MAGNORA GROUP CONSOLIDATED STATEMENT OF FINANCIAL POSITION
NOK million
Note
31.12.2022
31.12.2021
ASSETS
Non-current assets
Goodwill
29
34.1
0.0
Deferred tax assets
15
15.1
23.4
Fixed assets
6
15.3
0.0
Intangible assets
29
170.9
2.0
Right-of-use assets
25
9.0
0.0
Investment in associated companies
7
26.4
61.4
Loan to associates
6.3
0.0
Other non-current assets
0.0
1.3
Total non-current assets
277.1
88.1
Current assets
Trade and other receivables
10
91.5
6.8
Other current financial assets
28, 8
23.7
0.9
Cash and cash equivalents
11. 8
171.9
96.9
Total current assets
287.1
104.6
Total assets
564.2
192.7
EQUITY
Capital and reserves attributable to equity holders of the Company
Share capital
32.8
28.0
Treasury shares
-0.1
-0.1
Other equity
352.8
143.9
Total shareholder equity
385.5
171.8
Non-controlling interest
46.3
0.0
Total Equity
431.8
171.8
LIABILITIES
Non-current liabilities
Deferred income tax liabilities
15
4.9
0.0
Other non-current liabilities
25
5.2
0.0
Total non-current liabilities
10.1
0.0
Current liabilities
Trade payables
6.2
1.9
Overdraft facility
8
76.3
0.0
Provisions
17
0.6
2.3
Other current liabilities
14,25
39.1
16.7
Total current liabilities
122.3
20.9
Total liabilities
132.4
20.9
Total equity and liabilities
564.2
192.7
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 33
MAGNORA ASA | Q4 REPORT 2022
Oslo, Norway, 20 March 2023
The Board of Directors of Magnora ASA
Torstein Sanness
Chairman
Hilde Ådland
Board member
John Hamilton
Board member
Erik Sneve
CEO
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 34
MAGNORA ASA | Q4 REPORT 2022
+27739391820+27739391820
MAGNORA GROUP CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
NOK million
Share
capital
Treasury
Shares
Other
equity
Currency
transl.
reserve
Non-
controlling
interest
Total
equity
Equity as of 1 January 2022
28.0
-0.1
146.2
-2.3
171.8
Total comprehensive income for the
period
12.5
1.0
-7.7
5.8
Capital increase non-controlling
interest
0.0
54.0
54.0
Capital increase
4.8
0.0
189.7
0.0
194.4
Share based payments (Note 13)
5.8
0.0
5.8
Total changes in equity
4.8
0.0
208.0
1.0
46.3
260.0
Equity as of 31 December 2022
32.8
-0.1*
354.1
-1.3
46.3
431.8
* As of 31 December 2022, Magnora owned 21,866 shares or 0.03 percent of total shares outstanding through
the share buyback program.
NOK million
Share
capital
Treasury
Shares
Other
equity
Currency
transl.
reserve
Total
equity
Equity as of 1 January 2021
25.8
-0.1
92.4
0.0
118.1
Total comprehensive income for the
period
-62.8
-2.3
-65.1
Capital increase
2.2
113.2
0.0
115.4
Share based payments (Note 11)
3.4
0.0
3.4
Total changes in equity
2.2
0.0
53.9
-2.3
53.7
Equity as of 31 December 2021
28.0
-0.1*
146.2
-2.3
171.8
* As of 31 December 2021, Magnora owned 63,540 shares or 0.11 percent of total shares outstanding through the
share buyback program.
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 35
MAGNORA ASA | Q4 REPORT 2022
MAGNORA GROUP CONSOLIDATED CASH FLOW STATEMENT
NOK million
2022
2021
Cash flow from operating activities
Cash from operations
22
-67.7
-23.7
Net cash generated from operating activities
-67.7
-23.7
Cash flows from investment activities
Investments in associated companies
-22.7
-77.4
Investment in fixed assets
6
-8.7
0.0
Dividend received
6.1
0.0
Sale of associated companies
0.0
20.0
Investment in subsidiary net of cash acquired
-6.7
0.0
Scotwind lease option
29
-118.3
0.0
Received loan related to Scotwind lease option
23.7
0.0
Purchase/sale of marketable securities
27
1.3
18.9
Loan to Arendal Brygge AS
0.0
-1.2
Net cash from investment activities
-125.3
-39.7
Cash flow from financing activities
Overdraft facility drawn
76.3
0.0
Lease payment
25
-2.7
0.0
Capital increase
194.4
115.4
Net cash from financing activities
268.0
115.4
Net cash flow from the period
75.0
52.0
Cash balance at beginning of period
96.9
44.8
Cash balance at end of period*
171.9
96.9
* Restricted cash is NOK 1.7 million as of 31 December 2022.
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 36
MAGNORA ASA | Q4 REPORT 2022
MAGNORA GROUP NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. CORPORATE INFORMATION
The Group is a renewable energy development company, focusing on development of wind and Solar PV projects
from early phase greenfield to ready-to-build.
At the general meeting held on 21 May 2019, it was approved to amend the objectives of the company as set out in
the Articles of Association to reflect that the objective of the Group is the conduct of industry, trade and business
associated with energy, IT and commodities, and sectors directly or indirectly related to these, in addition to
investments in and acquisitions of businesses, securities, financial instruments and other assets, and participating in
other businesses, directly or indirectly linked to these. The Group continuously considers potential organic growth and
investment opportunities with the objective of generating further shareholder value.
The Group is a public limited liability company incorporated and domiciled in Norway and with its shares listed on the
Oslo Stock Exchange. The address of its registered office is Karenslyst Allé 6, 0277 Oslo. These consolidated financial
statements were approved by the Board of Directors on 20 March 2023.
Overview of Group structure as of 31 December 2022:
Subsidiaries
Registered
office
Shareholder
Shareholder
interest
31.12.2021
Shareholder
interest
31.12.2022
Ownership
account
method
Equity
Profit/
(loss)
2022
Magnora
Holding AS
Norway
Magnora ASA
100%
100%
Consolidating
-4.8
0.5
Magnora Offshore
Wind AS
Norway
Magnora ASA
100%*
80%
Consolidating
18.6
4.4
Magnora South
Africa Projects AS
Norway/
South Africa
Magnora ASA
100%
100%
Consolidating
-6.2
-6.3
Magnora
South Africa
Development AS
Norway/
South Africa
Magnora ASA
N/A
92%**
Consolidating
0.1
0.0
African Green
Ventures (pty) Ltd
South
Africa
Magnora
ASA
N/A
92%
Consolidating
2.5
-3.0
Magnora UK PV
Holding AS
Norway/
UK
Magnora ASA
N/A
100%
Consolidating
-0.8
-0.8
AGV Projects (PTY)
Ltd
South
Africa
Magnora
ASA
100%
100%
Consolidating
-11.1
-2.9
Magnora Offshore
Wind Holding Ltd
UK
Magnora
Offshore
Wind AS
N/A
100%
Consolidating
-35.6
-35.6
Magnora Offshore
Wind N3 Ltd
UK
Magnora
Offshore
Wind AS
N/A
100%
Consolidating
0.0
0.0
Hafslund Magnora
Sol AS
Norway
Magnora ASA
N/A
48%***
Equity Method
-1.7
-1.7
Neptun Tromsø AS
Norway
Magnora ASA
N/A
33.33%
Equity Method
0.0
0.0
Arendal Brygge AS
Norway
Magnora ASA
50%
50%
Equity Method
-5.4
0.5
Evolar AB
Sweden
Magnora ASA
50%
63.5%
Consolidating
19.9
-11.1
Helios Nordic
Energy AB
Sweden
Magnora ASA
40%
40%
Equity Method
-2.7
-3.5
Kustvind AB
Sweden
Magnora ASA
30%
37.5%
Equity Method
7.7
-5.6
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 37
MAGNORA ASA | Q4 REPORT 2022
Amounts in the table above are prepared in local GAAP and presented in NOK million.
* TechnipFMC ownership of 20% not yet registered in the Corporate Register as of 31 December 2021.
**Holding company in Norway is owned 100%
***Including indirect ownership through Helios Nordic Energy
Subsidiaries listed above of which the Group has a shareholder interest per 31.12.2022, are included in Magnora
ASA’s consolidated financial statements, as the control criteria in IFRS 10 are met.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies applied in the preparation of these consolidated financial statements are set out
below. These policies have been consistently applied to all the years presented, unless otherwise stated. All numbers
are in NOK million unless otherwise stated. Some totals may appear inconsistent due to rounding.
2.1. BASIS OF PREPARATION
The consolidated financial statements of the Group have been prepared in accordance with International Financial
Reporting Standards (IFRS) and IFRIC interpretations as adopted by the European Union (EU) and valid as of 31
December 2022. The consolidated financial statements have been prepared under the historical cost convention.
The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates.
It also requires management to exercise judgment in the process of applying the Group’s accounting policies. Areas
involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the
consolidated financial statements are disclosed in Note 4.
2.1.1. CHANGE IN ACCOUNTING POLICIES
The IASB has also adopted several minor changes and clarifications in several different standards. It is not expected
that any of these changes will have considerable effect for the Group. The Group has not chosen to adopt early any
standards, interpretations or amendments that have been issued but are not yet effective.
2.1.2. FUTURE CHANGES IN STANDARDS
The Group is not aware of any future IFRS changes that could affect the consolidated financial statements.
2.2. CONSOLIDATION
Subsidiaries
Subsidiaries comprise all entities over which the Group has the power to control. Control is achieved when the Group
is exposed, or has rights, to variable returns from its involvement with the investee and can affect those returns through
its power over the investee.
Specifically, the Group controls an investee if and only if the Group has:
»
Power over the investee
»
Exposure, or rights, to variable returns from its involvement with the investee, and
»
The ability to use its power over the investee to affect its returns
When the Group has less than a majority of the voting rights of an investee, the Group consider all relevant facts and
circumstances in assessing whether it has power over an investee, including:
»
The contractual arrangement with the other vote holders of the investee
»
Rights arising from other contractual arrangements
»
The Group’s voting rights and potential voting rights
The Group re-assesses whether it controls an investee and if facts and circumstances indicate that there are changes
to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control
over the subsidiary and ceases when the Group loses control over the subsidiary.
A change in ownership interest of a subsidiary, without loss of control, is accounted for as an equity transaction.
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 38
MAGNORA ASA | Q4 REPORT 2022
The Group applies the acquisition method to account for the acquisition of subsidiaries. The cost of an acquisition is
measured as the fair value of the assets transferred, equity instruments issued, and liabilities incurred assumed at the
date of exchange. Acquisition- related costs are expensed as incurred. Identifiable assets acquired and liabilities and
contingent liabilities incurred in a business combination are measured initially at their fair values at the acquisition
date. The Group recognises any non-controlling interest in the acquiree on an acquisition-by-acquisition basis, either
at fair value or at the non-controlling interest’s proportionate share of the recognised amounts of acquiree’s
identifiable net assets.
The excess of the cost of the acquisition over the fair value of the Group’s share of the identifiable net assets acquired
is recorded as goodwill. If the cost of the acquisition is less than the fair value of the net assets of the subsidiary
acquired, the difference is recognised in the income statement immediately.
Intercompany transactions, balances, and unrealised gains on transactions between Group companies are
eliminated. Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred.
Accounting policies of subsidiaries are changed where necessary to ensure consistency with the policies adopted by
the Group.
Joint Ventures and Associates
Joint ventures are companies or entities where Magnora has joint control with one or several other investors.
Share of associates are companies where Magnora has considerable, but not controlling influence. Normally,
considerable influence is defined as having an ownership between 20 % and 50 % of the voting rights.
Ownership in both joint ventures and associates are accounted for using the equity method of accounting.
Disposal of Subsidiaries
When the Group ceases to have control or significant influence, any retained interest in the entity is re measured to its
fair value, with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount
for the purposes of subsequently accounting for the retained interest as an associate, joint venture, or financial asset.
In addition, any amounts previously recognised in other comprehensive income in respect of that entity are
accounted for as if the group had directly disposed of the related assets or liabilities. This may mean that amounts
previously recognised in other comprehensive income are reclassified to profit or loss.
2.3. FOREIGN CURRENCY TRANSLATION
Functional and Presentation Currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the
primary economic environment in which each entity operates (‘the functional currency’). The consolidated financial
statements are presented in NOK, which is the Group’s presentation currency. The functional currency for the parent
company is NOK.
Transactions and Balances
Foreign currency transactions are translated into the functional currency using exchange rates prevailing at the dates
of the transactions. Foreign exchange gains and losses resulting from settlement of such transactions (realised items)
and from translation at exchange rates prevailing at balance sheet date of monetary assets and liabilities
denominated in foreign currencies (unrealised items) are recognised in the income statement, except when deferred
in equity as qualifying cash flow hedges.
Group Companies
The results and financial position of all Group entities (none of which has the currency of a hyperinflationary economy)
that have a functional currency different from the presentation currency, are translated into the presentation currency
as follows:
Assets and liabilities are translated at exchange rates prevailing at balance sheet date.
Income and expenses are translated at average exchange rates. All resulting exchange differences are recognised
in Other Comprehensive Income.
Upon consolidation, exchange differences arising from the translation of the net investment in foreign operations, and
of borrowings and other currency instruments designated as hedges of such investments, are taken to other
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 39
MAGNORA ASA | Q4 REPORT 2022
comprehensive income. When a foreign operation is sold, exchange differences that were recorded in equity are
recognised in the income statement as part of the gain or loss on sale. Goodwill and fair value adjustments arising on
the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing
rate.
2.4. TRADE RECEIVABLES AND OTHER FINANCIAL ASSETS
Trade receivables are amounts due from customers for services performed in the ordinary course of business. If
collection is expected in one year or less, they are classified as current assets. If not, they are presented as non- current
assets. Trade receivables and other financial assets are recognised initially at transaction price according to IFRS 15
and subsequently measured at amortised cost using the effective interest method, less provision for impairment. The
Group recognises an allowance for expected credit losses (ECLs) for all financial assets not held at fair value through
profit or loss (e.g., trade receivables). ECLs are based on the difference between the contractual cash flows due in
accordance with the contract and all the cash flows that the Group expects to receive, discounted at an
approximation of the original effective interest rate. The Group applies a simplified approach in calculating ECLs.
Therefore, the Group does not track changes in credit risk, but instead recognises a loss allowance based on lifetime
ECLs at each reporting date. The Group has established a provision matrix that is based on its historical credit loss
experience, adjusted for forward-looking factors specific to the debtors and the economic environment. The provision
for impairment of trade receivables is recognised in the income statement as ‘other operating expense’. The provision
for impairment of other financial assets is recognised in the income statement as ‘financial expense’.
Hedge accounting has not been applied in 2022 or 2021.
The Group measures financial assets at amortised cost if both of the following conditions are met:
» The financial asset is held within a business model with the objective to hold financial assets to collect contractual
cash flows and, » The contractual terms of the financial asset give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding financial assets at amortised cost are
subsequently measured using the effective interest (EIR) method and are subject to impairment. Gains and losses are
recognised in profit or loss when the asset is derecognised, modified, or impaired.
The Group’s financial assets at amortised cost includes trade receivables and other short-term receivables. Trade
receivables that do not contain a significant financing component are measured at the transaction price determined
under IFRS 15 Revenue from contracts with customers.
Financial assets are included in current assets, except for those with maturities greater than 12 months after
balance sheet date, in which case they are classified as non-current assets.
Financial assets also include marketable securities classified as other current financial assets. All securities acquired
are sufficiently liquid shares to allow trading on short notice in case additional funds are needed for working capital.
Furthermore, all securities are shares traded on the Oslo, Stockholm, or other major international stock exchanges, and
as such, subject to market risks in addition to the specific risks relevant for the company each security represents. Risks
related to marketable securities are managed by daily monitoring, weekly update of the portfolio overview, and
through trading shares not meeting the risk tolerance set by the Group.
As further detailed in note 27 below, these items are in accordance with IFRS 9 adjusted to reflect the current market
value of each security at the reporting date. Purchases and sales of marketable securities are accounted for at trade
date. Marketable securities are accounted for at fair value and reflected in the Income Statement as financial gain
or loss.
2.5. CASH AND CASH EQUIVALENTS
In the consolidated statement of cash flow, cash and cash equivalents includes cash in hand, bank deposits, other
short-term highly liquid investments with original maturities of three months or less.
2.6. SHARE CAPITAL
Ordinary shares are classified as equity. Incremental cost directly attributable to the issue of new shares is shown in
equity as a deduction, net of tax, from the proceeds. Where any Group company acquires the Group’s equity share
capital (treasury shares), the consideration paid, including any directly attributable cost (net of income taxes) is
deducted from equity attributable to the Group’s equity holders until the shares are cancelled, reissued, or disposed
of. Where such shares are subsequently sold or reissued, any consideration received, net of any directly attributable
transaction cost and income tax, is included in equity attributable to the Group’s equity holders.
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 40
MAGNORA ASA | Q4 REPORT 2022
2.7. CURRENT AND DEFERRED INCOME TAX
The tax expense for the period comprises current and changes in deferred tax. Tax is recognised in the income
statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.
In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.
The current income tax charge is calculated based on the tax laws enacted or substantively enacted at the balance
sheet date in the countries where the Group and its subsidiaries operate and generate taxable income.
Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax
regulation is subject to interpretation. It establishes provisions where appropriate based on amounts expected to be
paid to the tax authorities.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax
bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, the
deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other
than a business combination that at the time of the transaction affects neither accounting nor taxable profit and loss.
Deferred income tax is determined using tax rates (and legislation) that have been enacted or substantially enacted
by balance sheet date and are expected to apply when the deferred income tax asset is realised, or the deferred
income tax liability is settled. Deferred income tax assets are recognised to the extent that it is probable that future
taxable profit will be available against which the temporary differences can be utilised. Significant management
judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely
timing and the level of future taxable profits. Deferred income tax is provided on temporary differences arising from
investments in subsidiaries and associates, except where the timing of the
reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will
not reverse in the foreseeable future. The tax base included in the calculation of deferred income tax is calculated in
local currency and translated into NOK at foreign exchange rates prevailing at balance sheet date. Deferred income
tax asset and liabilities are offset when there is a legally enforceable right to offset current tax assets against current
tax liabilities and when the deferred income taxes assets and liabilities related to income taxes levied by the same
taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle
the balances on a net basis.
2.8. EMPLOYEE BENEFITS
Pension Obligations
As of year-end 2022 the Group operates a defined contribution plan. The plan is funded through payments to the
pension company, and the Group has no further payment obligations once the contribution is paid. The contributions
are recognised as employee benefit expenses when they are due. Prepaid contributions are recognised as an asset
to the extent that a cash refund or a reduction in the future payments is available.
Profit-Sharing, Retention and Bonus Plans
The Group recognises a provision where contractually obliged or where there is a constructive obligation. The provision
considers the incurred portion of the measurement period and shall be based on a ‘best estimate’ of the expected
achievements of the key performance indicators as set out in the actual bonus program.
Share-Based Payments
The Group has share-based payment programs to management and employees. Bonus shares in these programs are
awarded net after tax. The Group is obliged to withhold an amount for an employee’s tax obligation associated with
a share-based payment and transfer that amount, normally in cash, to the tax authority on the employee’s behalf.
These share-based payment programs, including tax, are considered as equity-settled share-based payments. In
addition, the Group is obliged to make a provision for social security tax related to these programs, to be transferred
to the tax authority, normally in cash. This part of the share-based payment arrangements is recognised as a cash-
settled share-based payment. Equity-settled share-based payments are measured at fair value (excluding the effect
of non-market-based vesting conditions) at the date of grant. The fair value determined at the grant date of the
equity-settled share-based payments is expensed over the vesting period, based on the Group’s estimate of the shares
that will eventually vest, adjusted for the effect of non-market based vesting conditions. Cash-settled share-based
payments are measured at fair value of the liability. The liability is remeasured at each reporting date.
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2.9. PROVISIONS
A provision is recognised in the balance sheet when the Group has a legal or constructive obligation because of a
past event, and it is probable that an outflow of economic benefits will be required to settle the obligation and the
amount has been reliably estimated.
Provisions are not recognised for future operating losses. Where there are several similar obligations, the likelihood that
an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision
is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations
may be small.
Provisions are measured as the present value of the expected expenditures required to settle the obligation using a
pre-tax discount rate that accounts for time value of money and risks specific to the obligation. The increase in the
provision due to passage of time is recognised as interest expense.
2.10. REVENUE RECOGNITION
Revenue from contracts with customers is recognised when control of the goods or services are transferred to the
customer at an amount that reflects the consideration to which the Group expects to be entitled in exchange for
those goods or services.
Revenue is recognised as follows:
»
The Group receives royalty in exchange for the license of intellectual property (design fees). The royalty received
is recognised at the later of when:
-
the subsequent sale or usage occurs; and
-
the performance obligation to which some or all the sales-based or usage-based royalty has been allocated is
satisfied
The royalty is based on production and offloading of oil barrels and the revenue is recognised as the offloading occurs.
»
Dividend income is recognised when the right to receive payment is established
»
Interest income is recognised on a time-proportion basis using the effective interest method
2.11. LEASES IFRS 16
The Group recognizes the lease liability and the associated “right-of-use asset” for the use of the underlying asset over
the lease term. All leases that transfer the right to control the use of an identifiable asset (the lessee decides the use
and receives the financial (dis-) advantages) are recognized. The lease liability is measured as present value of future
fixed lease payments. For lease agreements entered, the discount rate equivalent to the interest rate in the lease
agreement is used, if present. Alternatively, the marginal loan rate will be used. The Group has chosen to apply the
exemption rule for short-term leases up to 12 months durations and leases for which the underlying asset is of low value,
as these contracts are expensed directly in the income statement. For contracts that also include other product or
service deliveries, the Group has chosen to use the main rule where “non-lease components” are expensed as
operating expenses separately from the lease component. In determining the lease period, the regular lease period
is adjusted for extension options and termination rights, which with reasonable certainty is assessed that the Group will
exercise.
2.12. ACQUISITIONS
The acquisition method of accounting applies to business combinations. Compensation is measured at fair value on
the transaction date which is when risk and control is transferred and will normally coincide with the implementation
date. An allocation of the acquisition price is based on fair value of assets and liabilities acquired. Additional value
that cannot be allocated to identifiable assets and liabilities are allocated to goodwill. If fair value of identifiable assets
and liabilities is higher than consideration given, the excess is charged to income. The principles on how to recognize
acquisition of associates and joint ventures are the same as for acquisition of subsidiaries.
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2.13. INTANGIBLE ASSETS
Intangible assets that have been acquired separately are carried at cost. The costs of intangible assets acquired
through an acquisition are recognized at their fair value in the Group’s opening balance sheet. Capitalized intangible
assets are recognized at cost less any amortization and impairment losses. Internally generated intangible assets,
excluding capitalized development costs, are not capitalized but are expensed as occurred. The economic life is
either definite or indefinite. Intangible assets with a definite economic life are amortized over their economic life and
tested for impairment if there are any indications. The amortization method and period are assessed at least once a
year. Changes to the amortization method and/or period are accounted for as a change in estimate. Intangible
assets with an indefinite economic life are tested for impairment at least once a year, either individually or as a part
of a cash-generating unit. Intangible assets with an indefinite economic life are not amortized. The economic life is
assessed annually with regard to whether the assumption of an indefinite economic life can be justified. If it cannot,
the change to a definite economic life is made prospectively.
2.14. RESEARCH AND DEVELOPMENT
Expenses relating to research activities are recognised in the statement of comprehensive income as they incur.
Expenses relating to development activities are capitalised to the extent that the product or process is technically
and commercially viable and the Group has sufficient resources to complete the development work. Expenses that
are capitalised include the costs of materials, direct wage costs and a share of the directly attributable common
expenses. Capitalised development costs are recognised at their cost minus accumulated amortisation and
impairment losses. Capitalised development costs are amortised on a straight-line basis over the estimated useful life
of the asset.
2.15. IMPAIRMENT
Depreciable intangible assets as well as property, plant and equipment are considered for impairment
when there are indications that future earnings cannot justify balance sheet value. Goodwill and
intangible assets with indefinite useful life are not subject to depreciation but are tested annually for
impairment. Impairment is recognized if the carrying amount is higher than the recoverable amount. The
recoverable amount is the higher of fair value less costs to sell and value in use. For the purposes of
assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable
cash flows (cash generating units). At each reporting date, one considers the possibilities for a reversal
of prior impairments (except goodwill).
2.16. DIVIDEND DISTRIBUTION
Dividend distribution to the Group’s shareholders is recognised as a liability in the Group’s financial statements in
the period in which the dividend is approved by the Group’s shareholders.
2.17. TRADE PAYABLES
Trade Payables are obligations to pay for goods or services that have been acquired in the ordinary course of business
from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less (or in the
normal operating cycle of the business if longer). If not, they are presented as non-current liabilities. Trade payables
are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.
2.18. CASH FLOW STATEMENT
The cash flow statement is prepared in accordance with the direct method.
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NOTE 3. FINANCIAL RISK MANAGEMENT
3.1. FINANCIAL RISK FACTORS
The Group is exposed to market risk, credit risk, currency risk, interest rate risk, inflation risk, liquidity risk. The Company’s
overall risk management programme focuses on the uncertainty of financial markets and seeks to minimise potential
adverse effects on its financial performance. The Group selects its portfolio projects and companies with emphasis on
diversification to mitigate the various inherent risks in each segment of the renewable energy production industry. This
does not reduce the individual risks below but makes the Group less vulnerable to the effects of those risks.
3.1.1. MARKET RISK FOREIGN EXCHANGE RISK
The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures,
primarily with respect to the USD as all operating revenues is in USD. Foreign exchange risk arises from future
commercial transactions, recognised assets or liabilities, and net investments in foreign operations when such
transactions, assets or liabilities are denominated in a currency that is not the entity’s functional currency. The Group
is also exposed to foreign exchange risk related to GBP, SEK and ZAR when assets in the UK, Sweden, and South Africa
are divested. As most of the Group’s revenue is in USD, the Group has sold bulks of USD during 2022 to reduce this
currency risk.
The Group’s exposure to the risk of changes in foreign exchange rates relates primarily to the Group’s revenue. Any
annualised increase or decrease in the USD/NOK foreign exchange by 10 percent would have increased or
decreased the Group’s 2022 profit before tax by NOK 1.2 million (2021: NOK 1.4 million).
3.1.2. CREDIT RISK
Credit risk arises from cash and cash equivalents, derivative financial instruments and deposits with banks and financial
institutions, as well as loans and credit exposures to customers. The Group has one main banking relationship with a
financial institution that is currently rated Aa3.
The Group’s major customers are oil companies and global marine contractors with a strong financial basis, but, as
with suppliers and customers in general, there is a risk that unforeseen financial difficulties on the counterparty’s side
may arise which could have material adverse effects on the financial condition, the cash flows and/or the prospects
of the Group.
3.1.3. LIQUIDITY RISK
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, and the ability to
close out market positions.
The Group has implemented routines to continuously update its cash flow forecast with changes to main assumptions
relating to payment schedules, license milestone payments etc and to be able to foresee the necessary actions
required to rectify any potential adverse effects on its future liquidity position.
The Group is subject to currency, field development and reservoir risk in situations where the license fee is tied to the
field development and production such as the Dana income and Shell Penguins license fee income paid in USD. The
company also relies heavily on two customers, Dana Petroleum and Shell for most of its operating revenues over the
next three to four years.
The Group derive all its cash flow from financial investments, two legacy agreements and it associated companies.
Negative cash flow and lack of financial performance from those companies therefore affects the Group. The
exposure is limited to the Group’s invested amount in those companies and is closely linked to the associated
companies’ ability to execute its strategy and manage risks it is exposed to. Magnora is represented on all the boards
of its associated companies and mitigates risks through normal governance processes.
Access to capital is a risk now that the Group is investing in more capital-intensive projects. This is managed through
close dialogues with financial institutions and a strict timeline for cash flow that matches future investment payments
with investment gains from farm-downs and exits.
At the balance sheet date, the Group has only the overdraft facility and no other borrowings, and both Trade
receivable and payable mature within a normal 30-day cycle, with exception of some receivables towards the
associated companies.
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MAGNORA ASA | Q4 REPORT 2022
There were no significant overdue receivables as of 31 December 2022.
Magnora is in a solid liquidity position with a cash balance of NOK 171.9 million at balance sheet date.
3.1.4. COVENANT
The Group has NOK 100 million and NOK 50 million overdraft facility with two top tier Nordic banks, and NOK 76.3 million
was drawn as of 31 December 2022. The facilities has the following financial covenants:
-
Loan to value must be more than 35 percent
-
Book Equity must be more than NOK 100 million
-
Minimum liquidity of NOK 25 million
3.1.5. CAPITAL MANAGEMENT
For the Group’s capital management, capital means total equity and cash balance. The primary objective of the
Group’s capital management is to maximise shareholder value.
The Group manages its capital through budgeting and cost monitoring.
The Group has exercised a conservative capital and cash management during 2021 and 2022. A sound financial
position, with limited interest-bearing debt and an asset light balance sheet reduces the capital and cash
management risks.
NOTE 4. ACCOUNTING ESTIMATES AND JUDGEMENTS
Estimates and judgments are continually evaluated and are based on historical experience and other factors,
including expectations of future events that are assumed to be reasonable under current circumstances.
4.1. CRITICAL ACCOUNTING ESTIMATES AND ASSUMPTIONS
The Group makes estimates and assumptions concerning the future. The estimates and assumptions that have
significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial
year are disclosed below.
TAXES
Judgment is required in determining the provision for income taxes. During the ordinary course of business, transactions
and calculations occur for which the ultimate tax effect is uncertain. The Group recognises liabilities for anticipated
tax audit issues based on estimates of whether additional taxes will be due. Where the outcome of these matters is
different from the amounts initially recognised, such differences will impact the income tax and deferred tax provisions
in the period in which such determination is made.
The accounting for deferred income tax assets relies upon management’s judgment of the Group’s ability to generate
future positive taxable income in each respective jurisdiction. Deferred tax assets are recognised in relation to the
carry forward of unused tax losses only to the extent that it is probable that taxable profit will be available against
which the losses can be utilised in the future. Significant management judgement is required to determine the amount
of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits.
The companies within the Magnora Group have in sum material deductible temporary differences (reference note
15) which, dependent on meeting the recognition requirements according to IAS 12, could result in recognition of
deferred tax assets in the balance sheet.
The deferred tax asset has been updated as of December 31, 2022, based on the expected revenues and expenses
for the next five years. The recognised deferred tax asset is most sensitive to expected future royalty revenue from the
production and offloading of the Dana Western Isles FPSO, and the Group’s operating cost level going forward. An
assumption has been made that the FPSO will produce according to the expected production profile based on field
reserves and lifetime estimates, and that the cost level will continue based on current structure and activities of the
Group. The deferred tax asset recognised is expected to be utilised within the next 5 years based upon on the Group’s
contract portfolio and cost base as of today. The book value of the deferred tax asset represents a minor part of the
total accumulated tax losses. The book value of the deferred tax asset represents a minor part of the total
accumulated tax losses of over NOK 3.5 billion.
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MAGNORA ASA | Q4 REPORT 2022
4.2. JUDGEMENTS - INVESTMENT IN ASSOCIATED COMPANIES AND OPTION LEASE
Associated companies
The Group invested in Kustvind AB in March 2020 through a share issue and currently has 37.5 percent ownership.
Magnora further has the right to increase its ownership to 50% according to a budget and milestone plan. The option
to increase ownership is currently not exercisable, as the increase in ownership must come from a capital call from the
Kustvind board due to a capital need in the project. The three founders of Kustvind own equal shares of the remaining
shares in the company. Magnora has three out of five board members, and the founders have the remaining two
members of the board. The other shareholders have the right to elect its third board member at any time, and it is
expected that they will do so shortly. Magnora is a minority owner with three other owners and has significant influence
of the company. Hence its ownership is accounted for using the equity method as an associated company.
The Group invested in Evolar AB in November 2020 through a share issue for 28.44 percent ownership, which was
increased to 40.7 in June 2021 and to 50 percent in December 2021. The five founders of the company own equal
shares of the remaining shares in the company. Magnora has two out of five board members, and the founders have
the remaining three members of the board. Significant decisions (e.g., Issues of new shares, mergers or demergers,
sale of all or substantially all the assets of a member of the group, amendments and revisions of the business plan) shall
always require the consent and approval by the Board members nominated by Magnora. For other decisions
Magnora did not have the majority of the votes and not significant control as of 31 December 2021. Magnora ASA
acquired an additional 13.5% of the shares in April 2022 and owns a total of 63.5% of the company. As of 1 April 2022,
the ownership in Evolar has been fully consolidated in the financial statements.
The Group invested in Helios AB in February 2021 through a share issue and owns 40 percent of the company at the
balance sheet date. The remaining ownership of Helios is divided between the three founders of the company and
other early investors. Magnora has one out of five board members, and the founders and other shareholders have the
remaining four members of the board. Although Magnora is a majority owner, it exerts no strategic or operational
influence on this company, as Helios operates in a segment Magnora has not explored prior to this investment. This
company operates fully independent of Magnora. For up to two years after the First Investment from Magnora,
significant resolutions (e.g. Annual budgets, amendments in the business plan, any merger/ demerger and so on) must
be approved by the Board and supported by the director appointed by Magnora.
Magnora has significant influence in the company and its ownership is accounted for using the equity method as an
associated company.
Option lease agreement
The Scotwind lease option signed by Magnora with The Crown Estate Scotland is considered to be an intangible asset
in the statement of financial position. The agreement gives Magnora exclusive right to perform environmental studies
on the area awarded. When the requirements in the option lease agreement, including key project consent, are met,
the land lease will commence. The intangible asset will start amortizing when the lease commences and will be
amortized over the duration of the land lease.
NOTE 5. SEGMENT FINANCIALS
The Group has developed from being a former oil and gas engineering company with license revenues and
transformed into a renewable energy development company with several projects and investments in companies in
its portfolio. As the Group has grown, it has implemented an updated operating model to manage its increasing
portfolio. As part of the new operating model, corporate and project related activities and expenses are followed up
and reported separately. This is reflected in the tables below.
Both the project and corporate segments engage in business activities where it earns revenues and incur expenses.
The project segment has not earned any revenues yet as all projects are in early-phase development. All licensing
revenues from legacy oil and gas contracts are managed and reported as part of the corporate segment, and the
renewable activities and investments are reported in the project segment. M&A related expenses for projects
and transactions that do not materialise, are reported as an expense in the corporate segment, which is shown
separately to show the cost base of the Group. Operating results of the segments are regularly reviewed by the entity’s
chief operating decision maker, which is the Magnora board, to make decisions about resources allocated to the
segment and assess its performance. Segment performance is evaluated based on EBITDA and operating profit/ loss.
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MAGNORA ASA | Q4 REPORT 2022
SEGMENT FINANCIALS 2022
NOK million
Note
Corporate
Projects
Elimination
Consolidated
Operations
Operating revenue
91.1
0.0
0.0
91.1
Other operating revenue
11.6
0.3
-11.2
0.6
Operating expense
-30.6
-1.2
0.0
-31.8
Development and M&A expense
0.0
-60.6
11.2
-49.4
EBITDA
72.0
-61.5
0.0
10.5
Profit/loss from associated companies
0.0
-3.9
0.0
-3.9
Operating profit/(loss)
72.0
-65.4
0.0
6.6
SEGMENT FINANCIALS 2021
NOK million
Note
Corporate
Projects
Elimination
Consolidated
Operations
Operating revenue
24
13.8
0.0
0.0
13.8
Other operating revenue
24
4.9
0.0
-3.5
1.4
Operating expense
26
-30.8
-3.5
3.5
-30.8
Development and M&A expense
26
-0.5
-22.4
0.0
-22.9
EBITDA
-12.6
-25.9
0.0
-38.5
Profit/loss from associated companies
0.0
-21.6
0.0
-21.6
Operating profit/(loss)
-12.6
-47.5
0.0
-60.1
NOTE 6. FIXED ASSETS
Machinery and
equipment
Assets under
construction
Total
Opening net book value
0.0
0.0
0.0
Acquisition of subsidiaries
2.7
5.0
7,7
Acc depr acq. of
subsidiary
-0.9
0.0
-0,9
Additions
2.7
6.0
8.7
Depreciations
-0.2
0.0
-0.2
Total
4.3
11.0
15.3
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MAGNORA ASA | Q4 REPORT 2022
NOTE 7. ASSOCIATED COMPANIES
Associated company
Registered
office
Shareholder
Shareholder
interest
01.01.2021
Shareholder
interest
31.12.2021
Shareholder
interest
31.12.2022
Arendal Brygge AS
Norway
Magnora ASA
50%
50%
50%
Kustvind AB
Sweden
Magnora ASA
15%
30%
37.5%
Helios AB
Sweden
Magnora ASA
0%
40%
40%
2022
Registered
office
Assets
Liabilities
Revenues
Profit/loss
% interest
held
Arendal Brygge AS
Norway
49.5
54.3
3.8
0.5
50%
Kustvind AB
Sweden
7.0
0.1
-
-5.6
37.5%
Helios Nordic Energy AB
Sweden
24.7
27.4
9.4
-3.7
40%
Total
81.2
81.8
13.2
-8.8
Amounts in the tables above are prepared in local GAAP and presented in NOK million.
Associated companies (NOK million)
2022
2021
Book value 1 January
61.4
24.5
Acquisition of associates
6.8
80.7
Disposals/ -sale of associates
0.0
-20.0
Share of profit/loss
-3.9
-13.8
Dividen received
-6.1
0.0
Impairment
0.0
-7.7
Currency translation difference
-2.2
-2.2
Realization due to gain of control
-29.6
0.0
Net book value 31 December
26.4
61.4
Magnora owns 50% of the shares in Arendal Brygge AS, and the regional bank Sparebanken Sør owns the other 50%
of the shares. Arendal Brygge is classified as an associated company as Magnora does not exercise control over the
activities of Arendal Brygge AS and therefore accounts for its shareholding in Arendal Brygge using the equity method.
The book value of the investment has been written down to zero due to large losses incurred by Arendal Brygge AS,
and the operating results of Arendal Brygge is therefore not accounted for. Arendal Brygge is part of Magnora’s
legacy business. Arendal Brygge was the Company’s headquarter until it sold its previous business to Sembcorp
Marine. Sparebanken Sør and Arendal Brygge is investigating possibilities for developing the Arendal Brygge waterfront
property.
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Magnora invested in Kustvind AB in March 2020 and owns 37.5% as of 31 December 2022. The following table illustrates
the summarised financial information for Magnora’s investment in Kustvind AB:
Kustvind (NOK million)
2022
2021
Current assets
0.5
2.0
Non-current assets
7.3
0.5
Current liabilities
0.1
0.0
Equity
7.7
1.9
Magnora’s share in equity
2.9
0.6
Goodwill
10.8
10.7
Magnora’s carrying amount of investment
13.7
11.3
Profit/(loss) before tax
-5.6
-9.0
Total comprehensive income for the year
-5.6
-9.0
Magnora’s share of profit/(loss) for the year
-2.0
-1.6
Magnora invested in Helios Nordic Energy AB in February 2021 and owns 40 percent of the company as of 31
December 2022. The following table illustrates the summarised financial information for Magnora’s investment in Helios:
Helios Nordic Energy (NOK million)
2022
2021
Current assets
24.1
6.3
Non-current assets
0.6
15.2
Current liabilities
27.4
1.8
Non-current liabilities
0.0
0.7
Equity
-2.7
16.4
Magnora’s share in equity
-1.1
6.6
Goodwill
12.5
12.9
Magnora’s carrying amount of investment
11.4
19.5
Profit/(loss) before tax
-3.5
-8.2
Total comprehensive income for the year
-3.5
-8.2
Magnora’s share of profit/(loss) for the year
-1.4
-2.5
See note 3.1 above regarding development risks of the portfolio companies.
Impairment of associated companies is evaluated annually after year-end, and for financial year 2022 the Group has
assessed if there are indicators for impairment. No indicators for impairment were identified as all associated
companies are in an early phase of their development and progressing as planned.
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MAGNORA ASA | Q4 REPORT 2022
NOTE 8. FINANCIAL INSTRUMENTS BY CATEGORY
Accounting principles for financial instruments were applied to the line items below as indicated:
Financial assets
NOK million
2022
2021
Category:
Asset:
Financial assets at amortised cost
Trade receivables
91.5
6.8
Financial assets at amortised cost
Other financial assets
23.7
0.4
Financial assets at fair value through
profit/loss
Listed equity investments
0.0
0.5
Fair value through profit and loss
Cash and cash equivalents
171.9
96.9
Total financial assets
287.1
104.6
Financial liabilities
NOK million
2022
2021
Category:
Asset:
Fair value through profit and loss
Overdraft facility
76.3
0.0
Financial liabilities at amortised cost
Trade payables
6.2
1.9
Total financial liabilities
82.5
1.9
Set out below is a comparison, by class, of the carrying amounts and fair values of Magnora’s financial instruments,
other than those with carrying amounts that are reasonable approximations of fair values:
2022
2021
Financial assets
Carrying amount
Fair value
Carrying amount
Fair value
Non-listed equity investments
0.0
0.0
0.0
0.0
Listed equity investments
0.0
0.0
0.5
0.5
Fair Value Estimation
Management has determined that the fair values of cash, short-term deposits, trade receivables, trade payables,
bank overdrafts, and other current liabilities approximate their carrying amounts largely due to the short-term
maturities of these instruments.
The following methods and assumptions were used to estimate the fair values:
» There is an active market for the Group’s listed equity investments
Overdraft facility
The Group has a total available overdraft facility of NOK 150 million. As of 31 December 2022, NOK 76.3 of the overdraft
facility has been drawn. See note 3.1.5 for covenants related to the overdraft facility.
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NOTE 9. CREDIT QUALITY OF TRADE RECEIVABLES AND CASH
The credit quality of trade receivables and cash that were neither past due nor impaired was assessed by reference
to external credit ratings (where available) and by analysis of historical information about counterparty default rates:
Trade receivables
NOK million
2022
2021
No external rating
3.7
1.1
AA-
75.3
0.0
Total trade receivable and accrued income
79.0
1.1
Cash and cash equivalents
NOK million
2022
2021
Aa3
171.9
96.9
Total cash and cash equivalents
171.9
96.9
NOTE 10. TRADE AND OTHER RECEIVABLES
Specification of trade and other receivables
NOK million
2022
2021
Trade receivables
3.7
1.1
Contract Assets (accrued income)*
75.3
0.0
Other receivables
12.5
5.7
Trade and other receivables
91.5
6.8
*Mainly related to Shell Penguins FPSO
Aging of trade receivables
NOK million
2022
2021
Not Due
2.8
1.1
Due
0.9
0.0
Total trade receivables
3.7
1.1
At balance sheet date, NOK 0.9 million was past due in 2022 (2021: NOK 0.0 million).
Currency denomination of trade receivables, carrying amounts
NOK million
2022
2021
SEK
1.0
0.0
NOK
2.7
1.1
Total trade receivables
3.7
1.1
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NOTE 11. CASH AND CASH EQUIVALENTS
Specification of trade and other receivables
NOK million
2022
2021
Cash at bank and in hand
170.2
95.9
Restricted short-term bank deposits
1.7
1.0
Total cash and cash equivalents
171.9
96.9
NOTE 12. SHARE CAPITAL
The total authorised number of ordinary shares was 66.8 million (2021: 57.1 million) with a par value of NOK 0.49 (2021:
NOK 0.49) per share. All issued shares were fully paid at balance sheet date.
NOK million
Number of
shares
Share capital
Share premium
Total
1 January 2022
57,072,679
28.0
0.0
28.0
Capital increase
9,750,000
4.7
0.0
4.7
31 December 2022
66,822,679
32.7
0.0
32.7
NOK million
Number of
shares
Share
capital
Share
premium
Total
1 January 2021
52,586,698
25.8
0.0
25.8
Capital increase
4,485,981
2.2
0.0
2.2
31 December 2021
57,072,679
28.0
0.0
28.0
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MAGNORA ASA | Q4 REPORT 2022
20 largest shareholder accounts 3 February 2023
(source: VPS)
Number of shares
Percent ownership
HAFSLUND VEKST AS
4,474,272
6.70
KING KONG INVEST AS
2,670,995
4.00
GINNY INVEST AS
2,469,144
3.70
BEKKESTUA EIENDOM AS
1,881,860
2.82
CARE HOLDING AS
1,750,000
2.62
ALDEN AS
1,729,829
2.59
PHILIP HOLDING AS
1,648,377
2.47
F2 FUNDS AS
1,585,000
2.37
F1 FUNDS AS
1,503,121
2.25
ANDENERGY AS
1,468,140
2.20
INTERACTIVE BROKERS LLC
1,371,482
2.05
MP PENSJON PK
1,327,138
1.99
CLEARSTREAM BANKING S.A.
1,319,078
1.97
NORDNET LIVSFORSIKRING AS
1,281,560
1.92
ALTEA AS
1,154,944
1.73
AARSKOG, PHILLIP GEORGE
1,000,000
1.50
DNB BANK ASA
878,137
1.31
DANSKE BANK AS
781,492
1.17
BALLISTA AS
760,372
1.14
BAKLIEN, ÅSMUND
756,100
1.13
Total, 20 largest shareholders
31,811,041
47.61
Other shareholder accounts
35,011,725
52.39
Total number of shares
66,822,766
100.00
Foreign ownership
9,926,510
14.86
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 53
MAGNORA ASA | Q4 REPORT 2022
NOTE 13. SHARE-BASED PAYMENTS
In accordance with approval by the Annual General Meeting of 26 May 2020, 27 April 2021, and 26 April 2022, the
Board of Magnora issued 475,000 options during 2022 to provide long-term incentives to the Board and employees.
The options were awarded as follows:
Options awarded
Torstein Sanness, Executive Chairman
100,000
Erik Sneve, CEO
200,000
Bård Olsen, CFO
50,000
Haakon Alfstad, CEO Magnora Offshore Wind
50,000
Trond Gärtner, SVP, Business development
75,000
Total options awarded
475,000
375,000 of the options issued in 2022 have a three-year vesting period and remaining 100,000 have a two-year vesting period.
All options must be exercised within five years after vested.
This is an equity-settled share-based payment, and in accordance with IFRS 2, the value is determined as of the grant date.
At balance sheet date there are 1,475,000 options (2021: 1,900,000). The cost of the options is recorded monthly over the vesting
(service) period. See note 18 for expensed amount related to share-based payments.
The employee or board member receiving the options must stay in his or her position until vesting date to exercise the options.
The options are expected to have limited value at the time they become vested, and therefore more likely to be
exercised towards the end of the period exercisable. The Black-Scholes model is used to calculate the value of the options.
The risk-free rate is set from the rate of five-year treasury bonds at the time of grant date, and this matches the full length of
the options once vested. Volatility rate is derived from the daily share prices from 1 January 2019, and then annualised.
Share prices from prior periods are considered irrelevant, as the Group significantly changed in Q4 2018 with the sale of its
main business to Sembcorp.
Exercise price (NOK/Share) 2022
Number of
options 2022
Exercise price
(NOK/Share) 2021
Number of
options 2021
1 January
Granted
19.03
100,000
24.39
125,000
Granted
23.70
200,000
26.47
300,000
Granted
22.22
175,000
25.68
100,000
Granted
26.65
125,000
Granted
18.27
25,000
Granted
17.56
50,000
Exercised
6.5
900,000
Outstanding 31 December
1,475,000
725,000
Exercisable 31 December
166,668
900,000
The weighted average remaining contractual life for the share options outstanding as of 31 December 2022 was
6.7 years (2021: 5.5 years). The weighted average fair value of options granted during the year was NOK 13.76 (2020:
NOK 17.14). The range of exercise prices for options outstanding at the end of the year was NOK 7.92 to NOK 26.65
(2021: NOK 6.5 to NOK 26.65).
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MAGNORA ASA | Q4 REPORT 2022
The following table lists the inputs to the models used for the plans for the years ended 31 December 2021 and 2020,
respectively:
NOK million
2022
2021
Weighted average fair values at the measurement date
13.76
17.14
Risk free interest
2.83% / 3.13% / 3.13%
0.82% / 1.42% / 1.47% /
1.47% / 1.36% / 1.47%
Volatility
64% / 61% / 61%
69% / 68% / 68% /
68% / 67% / 65%
Exercise price
19.03 / 23.70 / 22.22
24.39 / 26.47 / 25.68 /
26.65 / 19.17 / 17.56
Model for estimation of fair value
Black-Scholes model
Black-Scholes model
NOTE 14. OTHER CURRENT LIABILITIES
NOK million
2022
2021
Payroll liabilities
2.7
0.9
Employer’s contribution tax and other taxes
4.3
2.1
Other payables
32.1
13.7
Total other current liabilities
39.1
16.7
NOTE 15. TAXES
Deferred income tax assets and liabilities are offset when a legally enforceable right to offset current tax assets against
current tax liabilities exists. For 2022 a tax rate of 22% has been used when calculating the deferred tax assets and
liabilities (2021: 22%).
Specification of booked deferred tax assets/ (liabilities)
(NOK million)
2022
2021
Specification net deferred tax assets/(liabilities):
Deferred tax asset to be reversed after more than 12 months
784.1
784.1
Deferred tax liabilities to be reversed after more than 12 months
-4.9
0.0
Net deferred tax asset/(liabilities)
769.0
784.1
Deferred tax assets not recognised in the balance sheet
-758.8
-760.7
Net deferred tax assets recognised in the balance sheet
15.1
23.4
Net deferred tax (liabilities) recognised in the balance sheet*
-4.9
0.0
*Deferred tax assets and liabilities are not offset as it is related to different tax jurisdictions.
Reconciliation of deferred tax assets:
Book value 1 January
23.4
31.1
Income statement charge relating to deferred tax assets
-8.3
-7.7
Book value 31 December
15.1
23.4
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MAGNORA ASA | Q4 REPORT 2022
Reconciliation of deferred tax liabilities:
Book value 1 January
0.0
0.0
Intangible assets from acquisition of subsidiaries
-5.1
0.0
Tax income related to depreciation of intangible assets
0.2
0.0
Book value 31 December
-4.9
0.0
Specification of deferred tax assets/ (liabilities) booked and not booked
(NOK million)
2022
2021
Deferred tax assets:
Investments and receivables
0.5
0.5
Fixed assets
0.4
0.4
Intangible assets
-4.9
0.0
Losses carry forward
773.1
783.2
Deferred tax assets
769.0
784.1
Deferred income tax assets are recognised for tax losses carried forward and deductible temporary differences to the
extent that the realisation of the tax benefit through future taxable profits is probable.
Significant management judgement is required to determine the amount of deferred tax assets that can be
recognised, based upon the likely timing and the level of future taxable profits. The recognised deferred tax asset is
most sensitive to expected future taxable profits.
At balance sheet date, the recognition criteria in IAS 12 were met. The deferred tax asset recognised is expected to
be utilised within the next 5 years based upon on the Group’s contract portfolio and cost base as of today. The book
value of the deferred tax asset represents a minor part of the total accumulated tax losses. Reference is made to Note
4.1 for further information.
Specification of tax income/(expense)
(NOK million)
2022
2021
Recognition of deferred tax asset
-8.3
-7.7
Tax income related to depreciation of intangible assets
0.2
0.0
Net tax income/(expense)
-8.1
-7.7
Reconciliation between tax charge based on the nominal statutory and actual tax rate
(NOK million)
2022
2021
Profit/(loss) before tax:
12.0
-55.1
Tax calculated (22%)
-2.6
12.1
Income not subject to tax
0.2
4.9
Expenses not deductible
-0.2
-3.6
Results from associated companies
-0.9
-4.8
Tax losses for which no deferred income tax asset was recognised
-4.6
-16.3
Tax income/(expense)
-8.1
-7.7
For 2022 a tax rate of 22% has been used when calculating the tax income / (expense), (2021: 22%).
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NOTE 16. RETIREMENT BENEFIT OBLIGATIONS
Pension cost charged to the income statement in 2022 was NOK 2.4 million (2021: NOK 0.7 million). The defined
contribution plan had 41 participants at 31.12.2022 (2021: 6 participants).
NOTE 17. PROVISIONS
NOK million
Payroll
Additional tax
Total
1 January 2022
2.3
0.0
2.3
Arising during the year
0.0
0.0
0.0
Reversed during the year
-1.7
0.0
0.0
31 December 2022
0.6
0.0
0.6
NOK million
Payroll
Additional tax
Total
1 January 2021
0.6
3.3
3.9
Arising during the year
1.7
0.0
1.7
Reversed during the year
0.0
-3.3
-3.3
31 December 2021
2.3
0.0
2.3
All provisions in 2022 and 2021 are current in nature.
Payroll
Provision for 2022 and 2021 is for employment tax (AGA) for the options issued.
Additional tax
Provision for potential additional tax on adjustment to the 2014 tax assessment. This additional tax was settled in 2021.
NOTE 18. EMPLOYEE BENEFIT EXPENSE
Specification of employee expense:
(NOK million)
2022
2021
Salaries and vacation pay
24.1
11.3
Employer’s contribution tax
6.4
1.9
Pension costs
2.4
0.7
Bonus
3.0
2.9
Share based payments
6.3
3.4
Other employee benefit expense
0.4
0.2
Capitalized development costs
-10.4
0.0
Total employee benefit expense
32.1
20.4
Average number of man-years
46
5
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2 57
MAGNORA ASA | Q4 REPORT 2022
2022 Remuneration of Senior Management:
NOK thousand
Salaries
Bonus
Retirement benefits
Other benefits
Erik Sneve, CEO
2,150
2,290
184
18
Bård Olsen, CFO
1,652
147
184
18
Total remuneration paid
3,802
2,437
368
36
2021 remuneration of Senior Management:
NOK thousand
Salaries
Bonus
Retirement benefits
Other benefits
Erik Sneve, CEO
2,027
2,559
176
17
Bård Olsen, CFO
1,538
284
168
17
Total remuneration paid
3,565
2,843
344
34
Retirement benefit plan was established in 2020 for the management team. No loans, pre-payments, or security
were granted to current Senior Management or any member of the Board of Directors in 2022 and 2021.
At the balance sheet date there were 1,475,000 options held by the Board of Directors and Senior Management (2021:
1,900,000 options). See note 13 for more information.
Reference is made to the ‘Statement regarding establishment of salary and other benefits for Senior Management’
for further details of remuneration of Senior Management. Remuneration of the Board of Directors:
NOK Thousand
Member from:
Member to:
2022*
2021
Torstein Sanness, Executive
Chairman
24 May 2017
5,716
924
Hilde Ådland, Board Member
24 May 2018
707
280
John Hamilton, Board Member
18 Dec 2018
765
330
Total remuneration paid
7,188
1,534
*Significant increase due to the board exercising options awarded in 2019.
Shares and options owned or controlled by the Board of Directors and Senior Management:
As of 31 December 2022, the Board members and Senior Management owned or controlled the following shares in
the Company:
Options owned or
controlled
Shares owned or
controlled
Torstein Sanness, Executive Chairman
250,000
594,442
Hilde Ådland, Board member
10,000
39,011
John Hamilton, Board member
40,000
33,837
Erik Sneve, CEO
350,000
1,173,871
Bård Olsen, CFO
150,000
50,000
Total remuneration paid
800,000
Reference is made to the ’Magnora Remuneration Report 2022’ for further details of remuneration of Senior
Management.
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NOTE 19. FINANCIAL INCOME
Financial income:
NOK million
2022
2021
Interest income
7.2
0.3
Gains from investments in marketable securities
0.8
22.1
Total financial income
8.1
22.4
Financial expense:
NOK million
2022
2021
Interest cost
-9.7
-0.4
Losses from investments in marketable securities
-0.5
-17.0
Total financial expense
-10.2
-17.4
NOTE 20. EARNINGS PER SHARE
Basic earnings per share
Basic earnings per share were calculated by dividing the profit attributable to equity holders of the Group by the
weighted average number of ordinary shares on issue during the year.
2022
2021
Net profit/(loss) attributable to equity holders (NOK million)
12.5
-62.8
Weighted avg. no. of ordinary shares on issue (thousands)
59,510
56,669
Basic earnings per share for continued operations (NOK per
share)
0.21
-1.11
Diluted earnings per share
2022
2021
Net profit/(loss) attributable to equity holders (NOK million)
12.5
-62.8
Weighted avg. no. of ordinary shares for diluted earnings per
share (thousands)
59,695
56,669
Basic earnings per share for continued operations (NOK per
share)
0.21
-1.11
NOTE 21. DIVIDEND AND REPAYMENT OF CAPITAL
There were no distributions in 2022 and 2021.
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MAGNORA ASA | Q4 REPORT 2022
NOTE 22. CASH GENERATED FROM OPERATIONS
NOK million
2022
2021
Cash flow from operating activities
Profit/(loss) before tax
12.0
-55.1
Adjustment for:
Depreciations
1.6
0.0
Share of associated companies’ financial results
3.9
21.6
Share based payments
6.3
3.4
Change in marketable securities and forwards
-0.8
-5.6
Change in working capital:
Capitalization of development costs
-19.4
0.0
Trade and other receivables
-106.0
-2.7
Trade and other payables
1.2
1.1
Other liabilities, provisions and charges
32.5
13.6
Cash generated from operations
-67.7
-23.7
NOTE 23. RELATED PARTY TRANSACTIONS
Magnora ASA has an agreement with all subsidiaries and associated companies that allows services to be provided
between the companies at agreed upon hourly rates. Magnora had both operating revenues and expenses from
services provided between the companies that are related parties to Magnora. The total operating revenues from
associated companies in 2022 was NOK 0.6 million (2021: NOK 1.4 million).
Specification of sale to and purchases from related parties in the period:
NOK million
2022
2021
Operating revenue from associated companies
0.6
1.4
Total operating revenue
0.6
1.4
NOK million
2022
2021
Operating expenses from associated companies
0.0
0.0
Operating expenses paid to other related parties
0.0
0.5
Total operating expense
0.0
0.5
Magnora ASA and Sparebanken Sør each provided NOK 1 million in shareholder loan to Arendal Brygge in 2019 to
support Arendal Brygge’s liquidity needs related to needed investments and working cash. The book value of the loan
was written down to zero in 2019 due to large losses incurred by Arendal Brygge AS, and a provision was made. In
2021 Magnora ASA provided NOK 1.4 million in a shareholder loan and received NOK 0.2 million in down payment in
2021 and NOK 0.1 million in 2022. The loan has a book value of NOK 1.1 million as of 31 December 2022 (NOK 1.2
million). Magnora does not exercise control over the activities of Arendal Brygge AS and accounts for its shareholding
in Arendal Brygge using the equity method.
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NOTE 24. REVENUE
Operating revenue in 2022 consisted mainly of license revenue related to the Shell Penguins FPSO project and royalty
income from the Dana Western Isles FPSO. The Group also had other revenue from Evolar in addition to operating
revenue from providing services to associated companies. Royalty from the Dana Western Isles FPSO constitutes 15%
(100%) of total external customer revenues. License revenue related to the Shell Penguins FPSO project constitutes 85%
(0%) of total external customer revenues.
NOK million
2022
2021
License fee (see also note 10)
87.6
13.8
Other revenue
3.5
0.0
Other operating revenue
0.6
1.4
Total operating revenue
91.7
15.2
Operating revenue from a geographic perspective
The revenue split, based on customer location was as follows:
NOK million
2022
2021
Norway
0.6
0.0
Sweden
3.5
1.4
UK
87.6
13.8
Total operating revenue
91.7
15.2
NOTE 25. LEASES
The Group has office rental agreements for its offices in Oslo as of 31 December 2022. The agreements can be
terminated with six month’s termination notice period. The Group has elected to apply the recognitions exemption in
IFRS 16 for short term leases, therefore, the lease is expensed as other operating expense over the lease term.
The Group expensed NOK 1.4 million in lease and rental cost for 2022 (2021: 0.5).
The Group also has rental agreements in Sweden which are accounted for according to IFRS 16.
Specification of changes in the period:
NOK million
Liability
Assets
Total opening balance right-to-use-assets/lease
obligations as per 1 January 2022
0.0
0.0
Addition due to acquisition of subsidiary
11.3
11.6
Depreciations
-
-2.7
Lease payments
-2.6
-
Other/currency effects
0.0
0.1
Total closing balance as of 31 December 2022
8.7
9.0
Interest expenses on the leasing obligation amounted to NOK 0.2 million in 2022.
Liabilities (NOK million)
2022
2021
Short-term liability
3.5
0.0
Long-term liability
5.2
0.0
Total closing balance as of 31 December 2022
8.7
0.0
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NOTE 26. OTHER OPERATING EXPENSE
(NOK million)
2022
2021
Office cost (rental etc)
3.4
1.4
Consultancy (audit, tax and legal) *
38.6
15.4
Travel expenses
0.9
0.2
Other
4.5
16.3
Total other operating expense
47.4
33.3
* Specification of auditor’s fee (excl. VAT):
Statutory audit
0.9
0.7
Other services
0.3
0.2
Other certification services
0.1
0.1
Total auditor’s fees
1.3
1.0
NOTE 27. MARKETABLE SECURITIES
In accordance with authorisation from the Board of Directors, Magnora sold marketable securities during 2022 with a
net gain of NOK 0.8 million (2021: NOK 5.6 million). The total value of other current financial assets held on the balance
sheet is NOK 23.7 million at yearend. On 31 December 2022, the value of the marketable securities was NOK 0.0 million
(2021: NOK 0.5 million).
(NOK million)
2022
2021
Marketable securities
0.0
0.5
Total value
0.0
0.5
The financial assets are recognised in the Balance Sheet at fair value. Unrealised fair value changes are recognised
in the profit and loss as financial income/(expense).
NOTE 28. OTHER CURRENT FINANCIAL ASSETS
(NOK million)
2022
2021
Marketable securities
0.0
0.5
Other current financial assets
23.7
0.4
Total value
23.7
0.9
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MAGNORA ASA | Q4 REPORT 2022
NOTE 29. INTANGIBLE ASSETS
NOK million
Goodwill
Option
lease
Technology
Total
Book value 1 January 2022
2.0
0.0
0.0
2.0
Additions
0.0
120.3
0.0
120.3
Acquisitions
31.9
0.0
47.7
79.6
Amortization
0.0
0.0
-0.9
-0.9
Currency translation
0.2
3.8
0.0
4.0
Book value 31 December 2022
34.1
124.1
46.8
205.0
Impairment testing of goodwill and intangible assets with indefinite useful lives
Goodwill and intangible assets with indefinite useful lives are tested annually for impairment by
comparing the carrying amount with the recoverable amount. The ratio is monitored based on what is
considered as the natural cash-generating unit (CGU) associated with each acquisition. The recoverable
amount is calculated based on the value the asset will add to it’s CGU.
The carrying amount of goodwill allocated to Evolar amounts to NOK 23,7 million as of 31 December
2022. For Evolar, liquidity prognosis based on budgets approved by leadership for the next nine -year
period, are used for the discounted cashflow analysis. There are no cash flow allocated beyond the
forcasted period. The key assumptions on which the management has based its cash flow projections
are launch year per production line (which corresponds to the expected commercialization of the
product), price per production line and the SEK/EUR exchange rate. Laun ch year per production line is
based on development progress so far and managements best estimate and price per production line
are based on discussion with key market players and managements best estimate. The cash flow is
discounted based on a WACC of 19.7%. The WACC is calculated based on a set of comparable listed
companies identified by management. Magnora gained control of the company in April 2022 and the
progress of the product development does not significantly divide from the plan. The company is in a
development phase, and there will always be risk involved until commercialization has taken place. No
reasonably possible change in key assumptions on which management has based its determination of
the unit’s recoverable amount would cause the unit’s carrying amount to exceed its recoverable
amount.
The carrying amount of goodwill allocated to the South African operations amounts to NOK 10,4 million
as of 31 December 2022. For African Green Venture in South Africa the CGU is valued based on sum
value of the project portfolio. In the project portfolio, each project is valued based on a milestone matrix
which includes capacity, price per MW and completion status. The key assumptions on which the
management has based its project valuation are price pe r MW (based on discussion with players in the
market), capacity per project and remaining risk per project (incl. grid connection). No reasonably
possible change in key assumptions on which management has based its determination of the unit’s
recoverable amount would cause the unit’s carrying amount to exceed its recoverable amount.
The assumptions used for calculating value in use vary between the different CGU’s and the discount
rates take into account the specific risk connected to each CGU.
Option lease agreement
The ScotWind lease option signed by Magnora with The Crown Estate Scotland is considered to be an
intangible asset in the statement of financial position. The agreement gives Magnora exclusive right to
perform environmental studies on the area awarded. When the requirements in the option lease
agreement, including key project consent, are met, the land lease will commence. The intangible asset
will start amortizing when the lease commences and will be amortized over the duration of the land
lease. There are no indications of impairment related to the option lease agreement as of 31 December
2022.
Technology
Technology is capitalized development related to the development of Evolar’s photovoltaic technology,
PV Power Booster. The development is according to plan an d there are no indications of impairment
related to the capitalized development costs as of 31 December 2022.
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NOTE 30. BUSINESS COMBINATIONS
ACQUISITION OF SOUTH AFRICAN SPV
Magnora and Vindr decided to split the Nordic and South African activities and discontinue the
development of Vindr Group. As part of this decision Magnora acquired African Green Venture (AGV) in
January 2022 together with the local AGV team and continue developing its win d and solar PV projects
in the region. Goodwill in the transaction is mainly related to synergies and competence of the staff,
which do not qualify for separate recognition. Goodwill will not be tax deductible. The company’s
operating revenue for the period 1 February to 31 December 2022 is NOK 0.0 million and the loss after
tax is NOK -3.0 million. If the acquisition had happened 1 January 2022, operating revenue would have
been NOK 0.0 million and the loss after tax NOK -3.2 million. See portfolio section in Board of Directors
Report above for more details.
Cash flow regarding acquisition
2022
Consideration paid
10.5
Cash and bank deposit in the company at acquisition date
-
Net cashflow regarding acquisition
10.5
Minority share
0.5
Total value of acquired company
11
Identified assets and liabilities on the balance sheet recognized from the
acquisition:
2022
Current assets
0.3
Property, plant and equipment
0.2
Current liabilities
0.7
Borrowings
-0.2
Total net identifiable assets
1.0
Intangible assets
2.0
Deferred tax regarding intangible assets
-0.4
Goodwill
8.4
Total
11.0
ACQUISITION OF EVOLAR AB
The Group acquired in April 2022 13.5% of the shares in Evolar AB, making the total Magnora ownership
63.5%. As of this transaction the ownership is fully consolidated in Group financial statements. Until 31
March 2022 Evolar AB was accounted for as an associated company in the Group accounts. The
allocation of intangible assets in the transaction is based on the cost approach according to IFRS 13.
Goodwill in the transaction is mainly related to competence of the staff, which do not qualify for separate
recognition. Goodwill from this transaction will not be tax deductible. The company’s operating revenue
for the period 1 April to 31 December is NOK 3.1 million and the loss after tax is NOK -10.4 million. If the
acquisition had happened 1 January 2022, operating revenue would have been NOK 4.3 million and the
loss after tax NOK -11.8 million.
Cash flow regarding acquisition
2022
Consideration paid on 100% basis
75.3
Total value of acquired company
75.3
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Identified assets and liabilities on the balance sheet recognized from the acquisition:
2022
Cash and bank deposits
20.2
Right-of-use-assets
12.3
Capitalized development costs
5.5
Financial assets
2.1
Trade and other receivables
2.2
Property, plant and equipment
7.4
Trade and other payables
-10.5
Borrowings / lease liabilities
-8.4
Total net identifiable assets
30.7
Intangible assets
24.5
Deferred tax regarding intangible assets
-5.1
Goodwill
25.0
Total
75.3
Non-controlling interests
27.5
Majority interest
47.8
Book value of Magnora’s share before the transaction
43.9
Gain/loss related to realization of the associated company
3.9
NOTE 31. EVENTS AFTER BALANCE SHEET DATE
Hafslund Magnora Sol AS has entered into option agreement contracts with landowners to develop solar PV parks in
Norway.
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MAGNORA ASA INCOME STATEMENT
NOK million
Note
2022
2021
Operating revenue
1, 10
87.7
13.8
Other operating revenue
11.9
16.4
Total operating revenue
99.6
30.2
Employee benefit expense
2
-24.6
-20.4
Other operating expense
4
-15.1
-27.1
Total operating expense
-39.7
-47.5
Operating Profit/(loss)
59.9
-17.3
Financial income
6
17.3
22.4
Financial expense
6
-4.6
-27.4
Foreign exchange gain/(loss) related to financing &
operating revenue
6.2
0.0
Net financial profit/(loss)
18.9
-5.0
Profit/(loss) before tax
78.8
-22.3
Tax expense/(income)
7
-8.3
-7.7
Annual net Profit/(loss)
70.5
-30.0
Attributable to:
Equity holders of the Company
70.5
-30.0
Distribution of net profit/(loss):
Capital distribution
0.0
0.0
Transfer to/from equity
70.5
-30.0
Annual net profit/(loss)
70.5
-30.0
Earnings per share for profit/(loss) attributable to the equity holders of the Company during the year (NOK per
share):
Basic
8
1.18
-0.53
Diluted
8
1.18
-0.53
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MAGNORA ASA | Q4 REPORT 2022
MAGNORA ASA BALANCE SHEET
NOK million
Note
31.12.2022
31.12.2021
ASSETS
Non-current assets
Deferred income tax assets
7
15.1
23.4
Investment in Subsidiaries
9
72.7
2.1
Investment in associated companies
40.9
76.2
Loan to associated companies and subsidiaries
182.1
11.2
Other non-current assets
0.0
0.0
Total non-current assets
310.7
112.9
Current assets
Trade and other receivables
11
87.2
21.4
Other current financial assets
0.0
0.7
Cash and cash equivalents
13
167.3
94.3
Total current assets
254.5
116.4
Total assets
565.2
229.4
EQUITY
Capital and reserves attributable to equity holders of
the Company
Share capital
16
32.8
28.0
Treasury shares
16
-0.1
-0.1
Other equity
16
448.7
182.8
Total equity
481.5
210.7
LIABILITIES
Current liabilities
Overdraft facility
76.3
0.0
Trade payables
2.3
0.6
Provisions
14
0.6
2.3
Other current liabilities
15
4.5
15.8
Total current liabilities
83.7
18.7
Total liabilities
83.7
18.7
Total equity and liabilities
565.2
229.4
Oslo, Norway, 20 March 2023
The Board of Directors of Magnora ASA
Torstein Sanness
Chairman
Hilde Ådland
Board member
John Hamilton
Board member
Erik Sneve
CEO
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MAGNORA ASA
CASH FLOW STATEMENT
NOK million
2022
2021
Cash flow from operating activities
Profit/(loss) before tax
78.8
-22.3
Adjustment for:
Items classified as investing and financing activities
5.8
-5.6
Value change marketable securities and forwards
-0.8
0.0
Write down of non-current assets
0.0
10.0
Trade and other receivable
-65.5
-17.3
Trade payables
1.8
-0.2
Other liabilities, provisions, and charges
-12.9
16.1
Cash generated from operations
7.1
-16.0
Cash flow from investment activities
Net purchase of investment shares
1.3
18.9
Acquisition of associated companies
-35.1
-77.4
Sale of associated companies
0.0
20.0
Loan to subsidiaries
-170.9
-11.2
Net cash from investment activities
-204.8
-49.7
Cash flow from financing activities
Overdraft facility drawn
76.3
0.0
Capital increase/(distribution)
194.1
115.4
Treasury shares
0.4
0.0
Net cash from financing activities
270.7
115.4
Net cash flow from the period
73.1
49.7
Cash balance at beginning of period
94.3
44.6
Cash balance at end of period
167.4
94.3
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MAGNORA ASA
NOTES TO THE
FINANCIAL STATEMENTS
ACCOUNTING POLICIES
Magnora ASA’s (‘the Company’) financial statements have been prepared in accordance with the Accounting Act
and generally accepted accounting principles in Norway.
Magnora ASA is the parent company of the Magnora Group (‘the Group’).
The Company’s functional currency is NOK. All numbers in the financial statements are in NOK 1,000,000 unless
otherwise stated.
Principal Rule for Evaluation and Classification of Assets and Liabilities
Assets intended for long term ownership or use, are classified as fixed assets. Assets relating to the operating cycle are
classified as current assets. Receivables are classified as current assets if they are to be repaid within one year after
balance sheet date. Equivalent criteria apply to liabilities.
Current assets are valued at the lower of purchase cost and net realisable value. Current liabilities are reflected in
the balance sheet at nominal value at establishment date.
Fixed assets are valued at purchase cost. Fixed assets whose value will decline are depreciated on a straight-line basis
over the asset’s estimated useful life. Fixed assets are written down to net realisable value if a value reduction occurs
that is expected to be permanent. Long-term liabilities are reflected in the balance sheet at nominal value on
establishment date.
Trade Receivables and Other Receivables
Trade receivables and other receivables are reflected in the balance sheet at nominal value less provision for
estimated losses. Estimated losses are provided for on the basis of an individual assessment of each debtor.
Trade payables
Trade Payables are obligations to pay for goods or services that have been acquired in the ordinary course of business
from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less (or in the
normal operating cycle of the business if longer). If not, they are presented as non-current liabilities. Trade payables
are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.
Provisions
A provision is recognised in the balance sheet when the Group has a legal or constructive obligation as a result of a
past event, and it is probable that an outflow of economic benefits will be required to settle the obligation and the
amount has been reliably estimated.
Provisions are not recognised for future operating losses. Where there are a number of similar obligations, the likelihood
that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A
provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of
obligations may be small.
Provisions are measured as the present value of the expected expenditures required to settle the obligation using a
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MAGNORA ASA | Q4 REPORT 2022
pre-tax discount rate that accounts for time value of money and risks specific to the obligation. The increase in the
provision due to passage of time is recognised as interest expense.
Tangible Fixed Assets
Fixed assets are reflected in the balance sheet and depreciated over the assets expected useful life on a straight- line
basis. Maintenance cost is expensed as incurred. Additions or improvements are added to the asset’s cost price and
depreciated with the asset. When changes in circumstances indicate that the carrying value of an asset may not be
recoverable, an impairment charge is recognised, and the asset is written down to recoverable amount (being the
highest of net sales value and value in use). Value in use is the net present value of the expected future cash flows
generated from the asset.
Financial Assets
Financial assets also include marketable securities classified as other current financial assets. All securities acquired
are sufficiently liquid shares to allow trading on short notice in case additional funds are needed for working capital.
Furthermore, all securities are shares traded on the Oslo, Stockholm, or other major international stock exchanges, and
as such, subject to market risks in addition to the specific risks relevant for the company each security represents. Risks
related to marketable securities are managed by daily monitoring, weekly update of the portfolio overview, and
through trading shares not meeting the risk tolerance set by the Company. Purchases and sales of marketable
securities are accounted for at trade date, and the assets are adjusted to reflect the current market value of each
security at the reporting date. Marketable securities are accounted for at fair value and reflected in the Income
Statement as financial gain or loss.
Shares in Subsidiaries and Associated Companies
In the parent company’s accounts, investments in subsidiaries and associated companies are recorded under the
cost method. Investments are written down to fair value when a reduction in value is expected to be permanent.
Dividend is recognised as income in the year the provision is made in the subsidiary. If the dividend exceeds retained
earnings, the excess represents repayment of invested capital, and dividend is deducted from the book value of the
investment in the balance sheet.
Cash and Bank Deposits
Cash and bank deposits include cash in hand, bank deposits and other short-term highly liquid investments with original
maturities of three months or less.
Currency
Cash and bank deposits, current assets, and current liabilities nominated in foreign currencies are converted to
exchange rates prevailing at balance sheet date. Realised and unrealised exchange gains and losses on assets and
liabilities in foreign currencies are included as financial items in the income statement.
Pension Plans
As of year-end 2022 the Company operates a defined contribution plan. The plan is funded through payments to the
pension company, and the Company has no further payment obligations once the contribution is paid. The
contributions are recognised as employee benefit expenses when they are due. Prepaid contributions are recognised
as an asset to the extent that a cash refund or a reduction in the future payments is available.
Taxes
Deferred income taxes is provided using the liability method on temporary difference at balance sheet date between
the tax basis of assets and liabilities and their carrying amounts for financial reporting purpose. Tax- reducing temporary
differences and losses carry forward are offset against tax-increasing temporary differences that are reversed in the
same time intervals. Taxes consist of taxes payable (taxes on current year taxable income) and change in net deferred
taxes.
Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be
recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those
that are enacted or substantively enacted by the balance sheet date. The book value of the deferred tax asset
represents a minor part of the total accumulated tax losses of approximately NOK 1.0 billion.
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Earnings per Share
Earnings per share are calculated by dividing net profit/loss by the weighted average of number of outstanding
shares. Shares issued during the year are weighted in relation to the period they have been outstanding.
Cash Flow Statement
The cash flow statement is prepared in accordance with the indirect method.
Revenue Recognition
Revenue comprises the fair value of the consideration receivable for the sale of goods and services in the ordinary
course of business. Revenue is shown net of value-added tax and discounts.
The Company recognises revenue when the amount of revenue can be reliably measured and in accordance with
the underlying contracts.
License revenue: License revenue is recognised in accordance with the underlying contracts.
Interest income: Interest income is recognised on a time-proportion basis using the effective
interest method.
Sales of services: Service income is recognised in line with the underlying contracts and the
amount of work executed.
Operating lease
Leases in which a significant portion of the risk and rewards of ownership are retained by the lessor are classified as
operating leases. Payments made under operating leases are charged to the income statement on a straight-line
basis over the period of the lease.
The Company has office rental agreements for its offices in Oslo as of 31 December 2022 (see note 5).
Use of Estimates
The preparation of financial statements in accordance with generally accepted accounting principles requires
management to use estimates and assumptions that impact the value of assets and liabilities as well as disclosure
notes. Such estimates and assumptions may have significant impact on reported revenue and cost for a specific
reporting period. Actual amounts may therefore deviate from the estimates.
Contingent losses, which are likely to occur as well as quantifiable, are expensed when incurred.
NOTE 1. OPERATING REVENUE
NOK million
2022
2021
License fee
87.7
13.8
Other revenue
11.9
16.4
Total operating revenue
99.6
30.2
Operating revenue from a geographic perspective
The revenue split, based on customer location was as follows:
NOK million
2022
2021
Norway
8.6
8.0
Sweden
1.2
0.2
South Africa
2.1
8.2
UK
87.7
13.8
Total operating revenue
99.6
30.2
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NOTE 2. EMPLOYEE BENEFIT EXPENSE
Specification of employee expense:
(NOK million)
2022
2021
Salaries and vacation pay
10.0
11.3
Employer`s contribution tax
4.1
1.9
Pension costs
1.1
0.7
Bonus
3.0
2.9
Option cost
5.8
3.4
Other employee benefit expense
0.6
0.2
Total employee benefit expense
24.6
20.4
Average number of man-years
7
5
2022 remuneration of Senior Management:
NOK thousand
Salaries
Bonus
Retirement
benefits
Other
benefits
Erik Sneve, CEO
2,150
2,290
184
18
Bård Olsen, CFO
1,652
147
184
18
Total remuneration paid
3,802
2,437
368
36
2021 remuneration of Senior Management:
NOK thousand
Salaries
Bonus
Retirement
benefits
Other
benefits
Erik Sneve, CEO
2,027
2,559
176
17
Bård Olsen, CFO
1,538
284
168
17
Total remuneration paid
3,565
2,843
344
34
The Group has a retirement benefit plan for all employees. No loans, prepayments or security were granted to a
member of Management or any member of the Board of Directors in 2022 and 2021.
At the balance sheet date there were 1,475,000 options held by the Board of Directors and Senior Management (2021:
1,900,000 options). See note 20 for more information.
Reference is made to the ‘Magnora Remuneration Report 2022’ for further details of remuneration of Senior
Management.
NOK Thousand
Member from:
Member to:
2022*
2021
Torstein Sanness, Chairman
24 May 2017
5,716
924
Hilde Ådland
24 May 2018
707
280
John Hamilton
18 Dec 2018
765
330
Total remuneration paid
7,188
1,534
*Significant increase due to the board exercising options issued in 2019.
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NOTE 3. RETIREMENT BENEFIT OBLIGATIONS
The Company is required to maintain a pension plan for its employees, as minimum two persons are employed in
positions of more than 75% of a fulltime position. Pension cost charged to the income statement in 2022 was NOK 1.1
million (2021: NOK 0.7 million). The defined contribution plan had 8 participants at 31.12.2022 (2021: 6 participants).
NOTE 4. OTHER OPERATING EXPENSE
(NOK million)
2022
2021
Office cost (rental etc)
2.6
1.2
Consultancy (audit, tax and legal) *
8.4
10.9
Travel expenses
0.6
0.2
Other
3.6
14.8
Total other operating expense
15.1
27.1
* Specification of auditor’s fee (excl. VAT):
Statutory audit
0.8
0.7
Other services
0.3
0.2
Other certification services
0.1
0.1
Total auditor’s fees
1.2
1.0
NOTE 5. LEASE AGREEMENTS
The Company has office rental agreements for its offices in Oslo as of 31 December 2022. The agreements are total
NOK 0.9 million per year and with six month’s termination notice period. The Company expensed NOK 1.4 million in
lease and rental cost for 2022 (2021: 0.5).
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NOTE 6. FINANCIAL INCOME AND FINANCIAL EXPENSE
Currency gains and losses relating to financing activities were presented as separate line item as a financial
income/(expense) in the Income Statement.
Financial income:
NOK million
2022
2021
Interest income
10.3
0.3
Dividend received
6.1
0.0
Other financial income
0.8
22.1
Total financial income
17.3
22.4
Financial expense:
NOK million
2022
2021
Interest cost
-4.6
-0.4
Write-down investment in associate
0.0
-10.0
Other financial expenses
0.0
-17.0
Total financial expense
-4.6
-27.4
NOTE 7. TAXES
Specification of booked deferred tax assets/ (liabilities)
(NOK million)
2022
2021
Specification net deferred tax assets/(liabilities):
Deferred tax asset to be reversed after more than 12 months
201.5
217.3
Deferred tax asset/(liability) to be reversed after more than 12
months
0.0
0.0
Net deferred tax asset/(liabilities)
201.5
217.3
Deferred tax assets not recognised in the balance sheet
-186.4
-193.9
Net deferred tax assets/(liabilities) recognised in the balance
sheet
15.1
23.4
Specification of deferred tax assets/ (liabilities)
(NOK million)
2022
2021
Deferred tax assets:
Investments and receivables
0.5
0.5
Fixed assets
0.3
0.4
Losses carry forward
200.7
216.4
Deferred tax assets
201.5
217.3
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Specification of tax income/(expense)
(NOK million)
2022
2021
Recognition of deferred tax asset
-8.3
-7.7
Net tax income/(expense)
-8.3
-7.7
Reconciliation between tax charge based on the nominal statutory and actual tax rate
(NOK million)
2022
2021
Profit/(loss) before tax:
78.8
-22.3
Tax calculated (22%)
-17.3
4.9
Income not subject to tax
1.5
4.9
Expenses not deductible
0.0
-5.8
Tax losses/gains for which no deferred income tax asset was
recognised
7.5
-11.7
Tax
income/(expense)
-8.3
-7.7
Deferred tax assets are recognised for unused tax losses only to the extent it is probable taxable profit will be available
against which the losses can be utilised in the future. Significant management judgement is required to determine the
amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable
profits. The recognised deferred tax asset is most sensitive to expected future taxable profits.
The deferred tax asset recognised is expected to be utilised within the next 5 years based upon on the company’s
contract portfolio and cost base as of today. The book value of the deferred tax asset represents a minor part of the
total accumulated tax losses.
NOTE 8. EARNINGS PER SHARE
Earnings per share were calculated by dividing the profit attributable to equity holders of the Company by the
weighted average number of ordinary shares on issue during the year.
2022
2021
Net profit/(loss) (NOK million)
-70.5
-30.0
Earnings per share (NOK)
1.18
-0.53
Earnings per share diluted (NOK)
1.18
-0.53
Average no. of outstanding shares (thousands)
59,510
56,699
Weighted avg. no. of ordinary shares for diluted earnings per
share (thousands)
59,695
56,699
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NOTE 9. INVESTMENTS IN SUBSIDIARIES
Investment in subsidiaries as of 31 December 2022:
Subsidiaries/
associated companies
Registered
office
Cost
price
No. of
shares
Equity
Book
value
Profit/
(loss)
Shareholder
interest
Magnora Holding AS
Norway
2,099.8
10,000
-4.8
0.0
-0.5
100%
African Green
Ventures (pty) Ltd
South Africa
14.9
920
2.5
15.0
-3.0
92%
AGV Projects Limited
South Africa
2.0
1,000
0.0
2.0
0.0
100%
Magnora Offshore
Wind AS
Norway
0.1
1,000
18.6
0.1
4.4
80%
Magnora Offshore
Wind Holding
Limited
UK
0.0
1,000
0.0
0.0
0.0
80%
Magnora Offshore
Wind N3 Limited
UK
0.0
1,000
0.0
0.0
0.0
80%
Evolar AB
Sweden
55.3
1,043,836
19.9
55.3
-11.1
63.5%
Magnora South Africa
Projects AS
Norway
0.1
1,000
-6.2
0.1
-6.3
100%
Magnora South Africa
Development AS
Norway
0.1
1,000
0.1
0.1
-0.0
100%
Magnora UK PV
Holding AS
Norway
0.0
30,000
-0.8
0.1
-0.8
100%
Total book value
72.7
The book value of Magnora Holding AS was written down to zero in 2016. The company has a negative equity balance
and a result of -0.5 for the year 2022 which does not cause reversal of the book value write down.
Investment in subsidiaries as of 31 December 2021:
Subsidiaries/
Associated companies
Registered
office
Cost price
No. of
shares
Equity
Book
value
Profit/
(loss)
Shareholder
interest
Magnora Holding AS
Norway
2,099.8
10,000
-4.3
0.0
0.0
100%
AGV Projects Limited
South
Africa
2.0
1,000
0.0
2.0
0.0
100%
Magnora Offshore
Wind AS
Norway
0.1
1,000
-6.5
0.1
-6.4
100%
Total book value
2.1
NOTE 10. RELATED PARTIES AND RELATED PARTY TRANSACTIONS
Associated
companies
Registered
office
Cost price
No. of shares
Equity
Book value
Profit/
(loss)
Shareholder
interest
Kustvind AB
Sweden
18.0
4,500
8.3
18.0
-5.6
37.5%
Helios Nordic Energy
AB
Sweden
22.9
1,333,334
-2.8
22.9
-3.5
40%
Hafslund Magnora
Sol AS
Norway
0.0
12,000
-1.7
0.0
-1.7
40%
Total book value
40.9
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Magnora has also invested NOK 22.9 million in Helios Nordic Energy AB for 40.00% ownership. As of 31 December 2022, the
investment is accounted for using the cost method.
In addition to this, Magnora has invested NOK 18 million in Kustvind AB for 37.50% ownership. As of 31 December 2022, the
investment is accounted for using the cost method.
Magnora ASA has an agreement with all subsidiaries and associated companies that allows services to be provided
between the companies at agreed upon hourly rates. Magnora had both operating revenues and expenses from
services provided between the companies that are related parties to Magnora. The total operating revenues from
subsidiaries and associated companies in 2022 was NOK 11.9 million (NOK 16.4 million).
NOK million
2022
2021
Operating revenue from associated companies
0.6
0.0
Operating revenue from subsidiaries
10.9
16.4
Total operating revenue
11.5
16.4
NOK million
2022
2021
Operating expenses from associated companies
0.0
0.4
Operating expenses paid to other related parties
0.0
0.0
Total operating expense
0.0
0.4
Receivables from companies in the Group:
(NOK million)
2022
2021
Magnora Holding AS
3.7
3.2
Magnora UK PV Holding AS
6.0
0.0
Kustvind AB
0.9
0.8
Magnora South Africa Projects AS
6.3
0.0
AGV Projects Ltd
11.1
8.2
Hafslund Magnora Sol
1.7
0.0
Magnora Offshore Wind AS
142.0
10.5
Evolar AB
20.3
0.2
Receivables from companies in the Group
192.0*
19.7
*The receivables from companies in the Group are split into NOK 182.1 million loan to related parties and NOK 9.9 other
receivables.
Magnora ASA also owns 50% of the shares in Arendal Brygge AS, and Sparebanken Sør owns the other 50% of the
shares. Magnora ASA and Sparebanken Sør each provided NOK 1 million in shareholder loan to Arendal Brygge in
2019 to support Arendal Brygge’s liquidity needs related to needed investments and working cash. The book value of
the loan was written down to zero in 2019 due to large losses incurred by Arendal Brygge AS, and a provision was
made. In 2021 Magnora ASA has provided NOK 1.4 MNOK in a shareholder loan and received NOK 0.2 MNOK in down
payment in 2021 and 0.1 in 2022. The loan has a book value of NOK 1.1 MNOK as of 31 December 2022.
NOTE 11. TRADE AND OTHER RECEIVABLES
NOK million
2022
2021
Trade receivables
11.2
19.7
Accrued income, not invoiced
75.4
1.2
Prepayment
0.6
0.5
Total trade and other current receivables
87.2
21.4
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MAGNORA ASA | Q4 REPORT 2022
NOTE 12. FINANCIAL ASSETS
In accordance with authorisation from the Board of Directors, Magnora ASA sold marketable securities during 2022
with a net gain of NOK 0.8 million (NOK 5.6 million). The value of the marketable securities was NOK 0.0 million on 31
December 2022. The total value of other current financial assets held on the balance sheet is NOK 0.0 million (NOK 0.7
million) at year end.
The financial assets are recognised in the Balance Sheet at fair value. Unrealised fair value changes are recognised
in the profit and loss as financial income/(expense).
NOTE 13. CASH AND CASH EQUIVALENTS
(NOK million)
2022
2021
Cash at bank and in hand
165.7
93.3
Restricted employees’ tax deduction fund
1.6
1.0
Total cash and cash equivalents
167.3
94.3
As of December 31, 2022, NOK 1.6 million was restricted cash (2021: 1.0).
NOTE 14. PROVISIONS
NOK million
Payroll
Total
1 January 2022
2.3
2.3
Arising during the year
0.0
0.0
Reversed during the year
-1.7
-1.7
31 December 2022
0.6
0.6
NOK million
Payroll
Total
1 January 2021
0.6
0.6
Arising during the year
1.7
1.7
Reversed during the year
0.0
0.0
31 December 2021
2.3
2.3
All provisions in 2021 and 2022 are current in nature.
P a y r o l l
Provision for 2021 and 2022 is for employment tax (AGA) for the options issued.
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MAGNORA ASA | Q4 REPORT 2022
NOTE 15. OTHER CURRENT LIABILITIES
NOK million
Note
2022
2021
Payroll liabilities
1.2
0.9
Employer’s contribution tax and other taxes
2.7
2.1
Other payables
0.6
12.8
Total other current liabilities
4.5
15.8
NOTE 16. EQUITY
NOK million
Share
capital
Treasury
Shares
Other
equity
Total
equity
Equity as of 1 January 2022
28.0
-0.1
182.8
210.7
Annual profit for the period
70.5
70.5
Share based payments
5.8
5.8
Capital increase
4.8
0.0
189.7
194.5
Equity as of 31 December 2022
32.8
-0.1*
448.8
481.5
* As of 31 December 2022, Magnora owned 21,866 shares or 0.03 percent of total shares outstanding through the
share buyback program.
NOK million
Share
capital
Treasury
Shares
Other
equity
Total
equity
Equity as of 1 January 2021
25.8
-0.1
96.3
122.0
Annual loss for the period
-30.0
-30.0
Acquired treasury shares*
0.0
Share based payments
3.3
3.3
Capital increase
2.2
113.2
115.4
Equity as of 31 December 2021
28.0
-0.1
182.8
210.7
* As of 31 December 2021, Magnora owned 63,540 shares or 0.11 percent of total shares outstanding through
the share buyback program.
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MAGNORA ASA | Q4 REPORT 2022
NOTE 17. SHAREHOLDER INFORMATIONS
20 largest shareholder accounts 3 February 2023
(source: VPS)
Number of shares
Percent ownership
HAFSLUND VEKST AS
4,474,272
6.70
KING KONG INVEST AS
2,670,995
4.00
GINNY INVEST AS
2,469,144
3.70
BEKKESTUA EIENDOM AS
1,881,860
2.82
CARE HOLDING AS
1,750,000
2.62
ALDEN AS
1,729,829
2.59
PHILIP HOLDING AS
1,648,377
2.47
F2 FUNDS AS
1,585,000
2.37
F1 FUNDS AS
1,503,121
2.25
ANDENERGY AS
1,468,140
2.20
INTERACTIVE BROKERS LLC
1,371,482
2.05
MP PENSJON PK
1,327,138
1.99
CLEARSTREAM BANKING S.A.
1,319,078
1.97
NORDNET LIVSFORSIKRING AS
1,281,560
1.92
ALTEA AS
1,154,944
1.73
AARSKOG, PHILLIP GEORGE
1,000,000
1.50
DNB BANK ASA
878,137
1.31
DANSKE BANK AS
781,492
1.17
BALLISTA AS
760,372
1.14
BAKLIEN, ÅSMUND
756,100
1.13
Total, 20 largest shareholders
31,811,041
47.61
Other shareholder accounts
35,011,725
52.39
Total number of shares
66,822,766
100.00
Foreign ownership
9,926,510
14.86
NOTE 18. FINANCIAL RISK MANAGEMENT
FINANCIAL RISK FACTORS
The Company’s activities expose it to a variety of financial risks; market risk (including currency risk, interest rate risk,
cash flow interest rate risk and price risk), credit risk and liquidity risk. The Company’s overall risk management program
focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Company’s
financial performance.
MARKET RISK
Foreign exchange risk
The Company operates internationally and is exposed to foreign exchange risk arising from various currency
exposures, primarily with respect to USD. Foreign exchange risk arises from future commercial transactions, recognised
assets or liabilities, and net investments in foreign operations when such transactions, assets or liabilities are
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MAGNORA ASA | Q4 REPORT 2022
denominated in a currency that is not the entity’s functional currency. Most of the Company’s revenue is in USD. To
reduce the currency risk, the Company hedged the exposure through selling USD in bulks when rates were favourable.
Credit risk
Credit risk arises from cash and cash equivalents, derivative financial instruments and deposits with banks and financial
institutions, as well as credit exposures to customers. The Company has one main banking relationship with a financial
institution that is currently rated Aa3 and two customers currently rated at BB and AA-.
Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, and the ability to
close out market positions.
The Company has implemented routines to continuously update its cash flow forecast, and the forecast is distributed
and reviewed by the Board and Senior Management at minimum monthly to be able to foresee potential adverse
effects on the liquidity and implement necessary actions to rectify the situation.
Magnora ASA is in a solid liquidity position with a cash balance of NOK 171.9 million at the balance sheet date.
NOTE 19. SHARE-BASED PAYMENTS
At balance sheet date there are 1,475,000 options (2021: 1,900,000).
In accordance with approval by the Annual General Meeting of April 26, 2022, the Board of Magnora has issued
475,000 options during 2022 to provide long-term incentives to the Board and the Management team.
NOTE 20. SHARES AND SHARE OPTIONS OWNED OR CONTROLLED BY THE BOARD OF
DIRECTORS AND SENIOR MANAGEMENT
Board members and Senior Management ownership in the Company as of 31 December 2022:
Options owned
or controlled
Shares owned or
controlled
Torstein Sanness, Executive Chairman
250,000
594,442
Hilde Ådland, Board member
10,000
39,011
John Hamilton, Board member
40,000
33,837
Erik Sneve, CEO
350,000
1,173,871
Bård Olsen, CFO
150,000
50,000
Total options outstanding for the Board and Senior Management
800,000
Reference is made to the ’Magnora Remuneration Report 2022’ for further details of remuneration of Senior
Management.
NOTE 21. DIVIDEND AND REPAYMENT OF CAPITAL
No distributions were made during 2022 and 2021.
NOTE 22. SUBSEQUENT EVENTS
Hafslund Magnora Sol AS has entered into option agreement contracts with landowners to develop solar PV parks in
Norway.
Statsautoriserte revisorer
Ernst & Young AS
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INDEPENDENT AUDITOR'S REPORT
To the Annual Shareholders' Meeting of Magnora ASA
Report on the audit of the financial statements
Opinion
We have audited the financial statements of Magnora ASA (the Company) which comprise the financial
statements of the Company and the consolidated financial statements of the Company and its
subsidiaries (the Group). The financial statements of the Company comprise the balance sheet as of 31
December 2022 and the income statement and statement of cash flows for the year then ended and
notes to the financial statements, including a summary of significant accounting policies. The
consolidated financial statements of the Group comprise the balance sheet as of 31 December 2022, the
statement of profit and loss, statement of comprehensive income, statement of cash flows and statement
of changes in equity for the year then ended and notes to the financial statements, including a summary
of significant accounting policies.
In our opinion
the financial statements comply with applicable legal requirements,
the financial statements give a true and fair view of the financial position of the Company at31
December 2022 and its financial performance and cash flows for the year then ended in
accordance with the Norwegian Accounting Act and accounting standards and practices
generally accepted in Norway,
the consolidated financial statements give a true and fair view of the financial position of the
Group as of 31 December 2022 and its financial performance and cash flows for the year then
ended in accordance with International Financial Reporting Standards as adopted by the EU.
Our opinion is consistent with our additional report to the audit committee.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our
responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of
the financial statements section of our report. We are independent of the Company and the Group in
accordance with the requirements of the relevant laws and regulations in Norway and the International
Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants
(including International Independence Standards) (IESBA Code), and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit
Regulation (537/2014) Article 5.1 have been provided.
We have been the auditor of the Company for 9 years from the election by the general meeting of the
shareholders on 9 July 2013 for the accounting year 2013.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial statements for 2022. These matters were addressed in the context of our audit of the
financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
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Independent auditor's report - Magnora ASA 2022
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opinion on these matters. For each matter below, our description of how our audit addressed the matter is
provided in that context.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial
statements section of our report, including in relation to these matters. Accordingly, our audit included the
performance of procedures designed to respond to our assessment of the risks of material misstatement
of the financial statements. The results of our audit procedures, including the procedures performed to
address the matters below, provide the basis for our audit opinion on the financial statements.
Purchase price allocations
Basis for the key audit matter
Magnora ASA increased its ownership in Evolar
AB from 50% to 63,5 % in the second quarter of
2022, making Magnora ASA a controlling
shareholder. The total consideration was NOK
75,3 million on a 100% basis.
Further, Magnora ASA acquired 95% of the
shares in African Green Ventures Proprietary
Limited (AGV) in the first quarter of 2022 with a
total consideration of NOK 11,0 million on a 100%
basis.
Based on the change of control management
made a purchase price allocation in which the
considerations were allocated to the identified
assets and liabilities based on the evaluated fair
values. The evaluation and identification of all
assets and liabilities and the assumption used in
the allocation of the purchase price requires
significant judgement by management. The audit
of the purchase price allocation is a key audit
matter due to both the financial magnitude of the
transactions and the significant judgments and
assumptions involved in the recognition and
measurement of the allocated values.
Our audit response
We, supported by valuation specialists, evaluated
the documentation of management evaluation.
We had meetings with management to
understand their process, valuation methods and
the assumption used for the allocation, including
understanding their identification of and valuation
of acquired assets and liabilities. Our audit
procedures further included evaluation of the
appropriateness of the acquisition accounting
applied, including the management conclusion of
when control was deemed to have passed,
We refer to note 30 in the consolidated financial
statements related to the purchase price
allocations.
Other information
Other information consists of the information included in the annual report other than the financial
statements and our auditor’s report thereon. Management (the board of directors and the general
manager) is responsible for the other information. Our opinion on the financial statements does not cover
the other information, and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information,
and, in doing so, consider whether the board of directors’ report, the statement on corporate governance
and the statement on corporate social responsibility contain the information required by applicable legal
requirements and whether the other information is materially inconsistent with the financial statements or
our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the
work we have performed, we conclude that the other information is materially inconsistent with the
financial statements, there is a material misstatement in this other information or that the information
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Independent auditor's report - Magnora ASA 2022
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required by applicable legal requirements is not included in the board of directors’ report, the statement
on corporate governance or the statement on corporate social responsibility, we are required to report
that fact.
We have nothing to report in this regard, and in our opinion, the board of directors’ report, the statement
on corporate governance and the statement on corporate social responsibility are consistent with the
financial statements and contain the information required by applicable legal requirements.
Responsibilities of management for the financial statements
Management is responsible for the preparation and fair presentation of the financial statements of the
Company in accordance with the Norwegian Accounting Act and accounting standards and practices
generally accepted in Norway and of the consolidated financial statements of the Group in accordance
with International Financial Reporting Standards as adopted by the EU, and for such internal control as
management determines is necessary to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s and the
Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless management either intends to liquidate the
Company or the Group, or to cease operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional
scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company’s and the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Company’s and the Group’s ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are required to
draw attention in our auditor’s report to the related disclosures in the financial statements or, if
such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Company and the Group to cease to continue as a going concern.
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Independent auditor's report - Magnora ASA 2022
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Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the consolidated financial
statements. We are responsible for the direction, supervision and performance of the group audit.
We remain solely responsible for our audit opinion.
We communicate with the board of directors regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the audit committee with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters
that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the board of directors, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the key
audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
Report on other legal and regulatory requirement
Report on compliance with regulation on European Single Electronic Format (ESEF)
Opinion
As part of the audit of the financial statements of Magnora ASA we have performed an assurance
engagement to obtain reasonable assurance about whether the financial statements included in the
annual report, with the file name “Magnoraasa-2022-12-31-en.zip”, have been prepared, in all material
respects, in compliance with the requirements of the Commission Delegated Regulation (EU) 2019/815
on the European Single Electronic Format (ESEF Regulation) and regulation pursuant to Section 5-5 of
the Norwegian Securities Trading Act, which includes requirements related to the preparation of the
annual report in XHTML format and iXBRL tagging of the consolidated financial statements.
In our opinion, the financial statements, included in the annual report, have been prepared, in all material
respects, in compliance with the ESEF Regulation.
Management’s responsibilities
Management is responsible for the preparation of the annual report in compliance with the ESEF
Regulation. This responsibility comprises an adequate process and such internal control as management
determines is necessary.
Auditor’s responsibilities
Our responsibility, based on audit evidence obtained, is to express an opinion on whether, in all material
respects, the financial statements included in the annual report have been prepared in accordance with
the ESEF Regulation. We conduct our work in accordance with the International Standard for Assurance
Engagements (ISAE) 3000 – “Assurance engagements other than audits or reviews of historical financial
information”. The standard requires us to plan and perform procedures to obtain reasonable assurance
about whether the financial statements included in the annual report have been prepared in accordance
with the ESEF Regulation.
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Independent auditor's report - Magnora ASA 2022
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As part of our work, we perform procedures to obtain an understanding of the company’s processes for
preparing the financial statements in accordance with the ESEF Regulation. We test whether the financial
statements are presented in XHTML-format. We evaluate the completeness and accuracy of the iXBRL
tagging of the consolidated financial statements and assess management’s use of judgement. Our
procedures include reconciliation of the iXBRL tagged data with the audited financial statements in
human-readable format. We believe that the evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Kristiansand, 20 March 2023
ERNST & YOUNG AS
The auditor's report is signed electronically
Espen Fyllingen
State Authorised Public Accountant (Norway)
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M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2
81
MAGNORA REMUNERATION
REPORT 2022
INTRODUCTION
1.1 Background
This remuneration report (the “Report”) is prepared by the board of directors of Magnora ASA (the “Group”) in
accordance with the Norwegian Public Limited Liability Companies Act (the “Companies Act”) Section 6-16 b with
regulations. The Report contains information regarding remuneration to previous, present and future leading personnel
of the Group for the financial year of 2022 in line with the applicable requirements.
The Group considers the CEO and the CFO as its management team and to be comprised by the term leading
personnel (“Directors”) under the Companies Act. There are no employees who are members of the board of directors
of the Group or the corporate assembly of the Group.
1.2 Highlights summary
The Group continued growing its investment portfolio and hired several key personnel during 2022. The following key
events during 2022 relates to the goals of the management team:
»
Investment in African Green Ventures Ltd. (AGV)
»
Award of option lease agreement for the N3 zone in the ScotWind licensing round
»
Established Hafslund Magnora Sol AS jointly with Hafslund and Helios
»
Private placement for additional funding of the Group
»
Loan facility agreements of NOK 150 million established
»
Close follow-up of investment portfolio and further increase in ownership as key milestones were achieved
(achieved for Evolar AB, and Kustvind AB)
»
Further development of the project and organisations in Magnora Offshore Wind, Hafslund Magnora Sol, and
Magnora South Africa
The CEO remuneration for 2022 was based on the following KPIs 1) manage and develop the organization, 2) financial
performance of the Group, 3) manage and develop investment portfolio, 4) identify and close suitable acquisitions,
and 5) share performance. The CFO remuneration was based on 1) development of finance function and support
funding of Group, 2) follow-up of Group governance and internal control in the investment portfolio, 3) quality of
financial reporting in the Group.
There was no deviation or derogation from the remuneration policy during the reported financial year.
1.3 Overview of the last financial year
The Group continued with significant growth and value creation in 2022. In January 2022, Magnora awarded an area
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2
82
to develop a floating wind park on the northside of Scotland, and the option lease agreement was signed in April
2022 with the Crown Estate Scotland.
In February 2022, Magnora acquired AGV. AGV is a greenfield developer of wind, large-scale PV, and battery projects
in the South Africa. The company has developed a project portfolio by signing options for land leases in well suited
locations in South Africa and has land lease agreements for projects with a total installed capacity potential of
approximately 2 GW.
In March 2022, Magnora entered the UK market through partnering with a local developer. At the end of 2022, the
portfolio consists of a 60 MW solar PV project, and two BESS projects totalling 200MWh. The 80MW/160MWh BESS project
is located on brown field land in an industrial area.
In September 2022, Magnora closed an equity private placement of 8,950 new shares with a subscription price per
share of NOK 22.35 and a total offer size of NOK 200 million. This funding was key to continue the investments and
activities planned. The Group also secured NOK 150 million in loan facilities with tier one banks during 2022 to secure
financial flexibility.
In September 2022, Magnora established Hafslund Magnora Sol AS with Hafslund and Helios for development of large-
scale solar parks in Norway.
Kustvind AB has progressed according to the initial business plan, and Magnora has increased its ownership in the
company to 37.5 percent during 2022.
The Group increased its ownership in Evolar AB to 63.5 percent during 2022. Evolar has a very disruptive technology
which enables solar panel and glass manufacturers to boost performance on all solar cells at a very low cost with their
tandem technology. Over the next decade Evolar can help the world develop solar cells with efficiency in the low-
to- mid 30 percents.
2. TOTAL REMUNERATION FOR DIRECTORS
Introduction
The table in Section 2.2 below contains an overview of the total remuneration received by the Directors, as well as
remuneration that were granted/awarded/due but not yet materialised, during the reported financial year. Only
remuneration earned on the basis of the Directors’ role as a leading person is comprised.
The Directors have not received remuneration from other companies within the Group.
Remuneration of Directors for the reported financial year:
Fixed
remuneration
Variable
remuneration
NOK thousand
Year Salary
Other
benefits
Bonus Options Pension
Total
Remuneration
Proportion
fixed/variable
Erik Sneve,
CEO
2022 2,150 18 2,290 200,000 184 4,642 51%/49%
2021 2,027 17 2,559 100,000 176 4,779 46%/54%
2020 2,059 15 2,775 50,000 130 4,979 44%/56%
2019* 1,727 0 0 400,000 0 1,727 100%/0%
*
Employment with Magnora ASA started 2 January 2019 as a consultant and assumed CEO role 16 April 2019. Actual
salary amount was 1,295,000 and has been adjusted to reflect what it would have been for the full year.
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2
83
Fixed
remuneration
Variable
remuneration
NOK thousand
Year Salary
Other
benefits
Bonus Options Pension
Total
Remuneration
Proportion
fixed/variable
Bård Olsen,
CFO
2022 1,652 18 147 50,000 184 2,001 93%/7%
2021 1,538 17 284 50,000 168 2,007 86%/14%
2020 1,250 15 216 50,000 129 1,610 87%/13%
2019* 1,100 0 0 0 0 1,100 100%/0%
*
Employment with Magnora ASA started 22 May 2019 with a three-month transition period with the former CFO and the two
employees in the Finance Department that also were leaving the Company 31 August 2019. Position was not a full- time
position in 2019. Actual salary amount was 381,000 and has been adjusted to reflect what it would have been for the full
year if engaged full-time.
2.1 REMUNERATION OF DIRECTORS FOR THE REPORTED FINANCIAL YEAR FROM THE GROUP
None.
3. SHARE-BASED REMUNERATION
3.1 Introduction
The table(s) in Section 3.2 below contains information on the number of shares granted or offered to the Directors,
whilst the table(s) in Section 3.3 below contains information on the number of share options granted or offered for the
reported financial year. In both of the tables, the main conditions for the exercise of the rights including the exercise
price and date and any change thereof appear.
3.2 Shares granted or offered to the Directors for the reported financial year
None.
3.3 Share options granted or offered to the Directors for the reported financial year
The main conditions of share options plans
Name &
position
Specification
of plan
Performance
period
Award
date
Vesting
date
End of
holding
period
Exercise
period
Strike price
of share
Erik Sneve,
CEO
2019
Magnora ASA
Share Option
Plan
21/5/2019
- 21/5/2020
21/5/2019 21/5/2020 21/5/2025
21/5/2020
- 21/5/2025
6.5
Magnora ASA
Share Option
Plan
1/4/2020
- 1/4/2023
1/4/2020 1/4/2023 1/4/2028
1/4/2023
- 1/4/2028
8
Magnora ASA
Share Option
Plan
2/6/2021
- 2/6/2024
2/6/2021 2/6/2024 2/6/2029
2/6/2024
- 2/6/2029
25.68
Magnora ASA
Share Option
Plan
27/11/2022
- 27/11/2025
27/11/2022 27/11/2025 27/11/2030
27/11/2025
- 27/11/2030
23.70
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2
84
Information regarding the reported financial year
Opening balance During the year Closing balance
Name &
position
Share options
awarded at the
beginning of
the year
Share options
awarded
Share options
vested
Share options
subject to a
performance
condition
Share options
awarded and
unvested
Erik Sneve,
CEO
400,000
400,000
50,000
50,000
100,000
100,000
200,000
200,000
Total 550,000 200,000 400,000
350,000
The main conditions of share options plans
Name &
position
Specification
of plan
Performance
period
Award
date
Vesting
date
End of
holding
period
Exercise
period
Strike price
of share
Bård Olsen,
CFO
Magnora ASA
Share Option
Plan
1/4/2020
- 1/4/2023
1/4/2020
1/4/2023
1/4/2028
1/4/2023
- 1/4/2028
8
Magnora ASA
Share Option
Plan
25/8/2020
- 25/8/2023
25/8/2020
25/8/2023
25/8/2028
25/8/2023
- 25/8/2028
9.65
Magnora ASA
Share Option
Plan
9/4/2021
- 9/4/2024
9/4/2021
9/4/2024
9/4/2029
9/4/2024
- 9/4/2029
26.47
Magnora ASA
Share Option
Plan
27/12/2022
- 27/12/2025
27/12/2022
27/12/2025
27/12/2030
27/12/2025
- 27/12/2030
22.22
Total
Information regarding the reported financial year
Opening balance During the year Closing balance
Name &
position
Share options
awarded at the
beginning of
the year
Share options
awarded
Share
options vested
Share options
subject to a
performance
condition
Share options
awarded and
unvested
Bård
Olsen,
CFO
25,000 25,000
25,000 25,000
50,000 50,000
50,000 50,000
Total 100,000 50,000 150,000
4. ANY USE OF THE RIGHT TO RECLAIM VARIABLE REMUNERATION
No variable remuneration was reclaimed during 2022.
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2
85
5. INFORMATION ON HOW THE REMUNERATION COMPLIES WITH THE REMUNERATION
POLICY
Please find below an explanation on how the total remuneration complies with the adopted remuneration policy,
including how it contributes to the long-term performance of the Company and information on how the performance
criteria were applied.
The Group has grown during 2022 with the increased ownerships in Evolar AB and Kustvind AB, and the acquisition of
the South African company, AGV, and further development of the projects in South Africa. The successful private
placement in September 2022 was key to secure the needed funding to implement the strategy approved by the
board. In addition to further expanding into South Africa, the Group expanded into UK in the solar PV and battery
segments. Senior Management has made specific deliverables in these achievements that has been instrumental for
the Group achieving its goals.
The investments made since the Group changed from the Oil and Gas sector to the renewable energy sector, each
investment has been selected to form a diversified portfolio of companies and projects. The diversification has been
a key selection criterion to secure long-term growth of the Group and reduce its sensitivity to the performance of each
individual investment.
Information of performance targets
Name and
position
Description of
the performance
criteria and type
of applicable
remuneration
Relative
weighting of the
performance
criteria
a) Minimum
target / threshold
performance and
b) Corresponding
award
a) Minimum
target / threshold
performance and
b) Corresponding
award
a) Measured
performance and
b) actual award
outcome
Erik Sneve,
CEO
Criterion A:
Manage and
develop Group
10%
Increase team to
match increase in
investments
Achieved – 10%
awarded
Criterion B:
Financial
performance of
Group
15%
Maintain cost
focus and ensure
adequate funding
Achieved – 15%
awarded
Criterion C:
Manage
and develop
investment
portfolio
30%
Ensure progress
according to
business plan
agreed at time of
investment
Achieved – 30%
awarded
Criterion D:
Identify and close
new investments
25%
2-3 investments
closed per year
Achieved – 25%
awarded
Criterion E: Share
performance vs
peers
20%
Match % change
in share price with
peers
Achieved – 13%
awarded
Bård Olsen,
CFO
Criterion A:
development of
finance function
and support
Group funding
30%
Develop finance
function as Group
grows
Achieved – 30%
awarded
Criterion B: Group
governance and
internal control in
portfolio
companies
30%
Follow up portfolio
companies to
ensure key
controls are
implemented
Achieved – 30%
awarded
Criterion C: Quality
of Group financial
reporting
40%
Ensure accurate
financial reporting
Achieved – 40%
awarded
6. DEROGATIONS AND DEVIATIONS FROM THE REMUNERATION POLICY FROM THE
PROCEDURE FOR ITS IMPLEMENTATION
No deviations from the remuneration policy or the procedure for the implementation of the remuneration policy has
been applied during 2022.
M A G N O R A A S A | A N N U A L R E P O R T 2 0 2 2
86
7. COMPARATIVE INFORMATION ON THE CHANGE OF REMUNERATION AND COMPANY
PERFORMANCE
The table below in this Section 7 contains information on the annual change of remuneration of each individual
Director, of the performance of the Group and average remuneration on a full-time equivalent basis of employees of
the Company other than Directors since the Group was reorganised in 2019.
Annual change 2020 VS 2019 2021 VS 2020 2022 VS 2021
Information
regarding
the recent
financial
year (RFY)
Director’s remuneration
Erik Sneve, CEO
4,979,000 VS 1,727,000 4,779,000 VS 4,979,000
4,642,000 VS
4,779,000
4,642,000
Bård Olsen, CFO
1,610,000 VS 1,100,000 2,007,000 VS 1,610,000
2,001,000 VS
2,007,000
2,001,000
Company performance
Financial metric A
Successful investments
portfolio companies:
3 VS 0
5 VS 3 4 VS 5
Financial metric B
Income from investments
in marketable securities:
20.2 MNOK VS 1.5 MNOK
4.9 MNOK VS 20.2 MNOK
0.6
MNOK
(6.4
MNOK distribution
from Helios) VS 4.9
MNOK
Financial metric C**
MGN share price:
27.4 VS 7
18.78 VS 27.4 21.2 VS 18.78
Non-financial metric D*
Developing organization:
4 VS 2
Developing organization:
10 VS 4
10 VS 10
Average remuneration on
a full-time equivalent basis
of employees
Employees of the Group
N/A – no other
employees
in Group until 2021
N/A – no other employees
in Group until 2021
8 VS 6
* Reflects full-time resources of which some are hired-in consultants.
** Share price as of 31 December.
Oslo, Norway, 20 March 2023
The Board of Directors of Magnora ASA
Torstein Sanness
Chairman
Hilde Ådland
Board member
John Hamilton
Board member
Erik Sneve
CEO
Statsautoriserte revisorer
Ernst & Young AS
Markens gate 9, 4610 Kristiansand
Postboks 184, 4662 Kristiansand
Foretaksregisteret: NO 976 389 387 MVA
Tlf: +47 24 00 24 00
www.ey.no
Medlemmer av Den norske Revisorforening
A member firm of Ernst & Young Global Limited
INDEPENDENT AUDITOR’S ASSURANCE REPORT ON REMUNERATION REPORT
To the General Meeting of Magnora ASA
Opinion
We have performed an assurance engagement to obtain reasonable assurance that Magnora ASA’s
report on salary and other remuneration to directors (the remuneration report) for the financial year ended
31 December 2022 has been prepared in accordance with section 6-16 b of the Norwegian Public Limited
Liability Companies Act and the accompanying regulation.
In our opinion, the remuneration report has been prepared, in all material respects, in accordance with
section 6-16 b of the Norwegian Public Limited Liability Companies Act and the accompanying regulation.
Board of directors’ responsibilities
The board of directors is responsible for the preparation of the remuneration report and that it contains
the information required in section 6-16 b of the Norwegian Public Limited Liability Companies Act and
the accompanying regulation and for such internal control as the board of directors determines is
necessary for the preparation of a remuneration report that is free from material misstatements, whether
due to fraud or error.
Our independence and quality control
We are independent of the company in accordance with the requirements of the relevant laws and
regulations in Norway and the International Ethics Standards Board for Accountants’ International Code
of Ethics for Professional Accountants (including International Independence Standards) (IESBA Code),
and we have fulfilled our other ethical responsibilities in accordance with these requirements. Our firm
applies International Standard on Quality Control 1 (ISQC 1) and accordingly maintains a comprehensive
system of quality control including documented policies and procedures regarding compliance with ethical
requirements, professional standards and applicable legal and regulatory requirements.
Auditor’s responsibilities
Our responsibility is to express an opinion on whether the remuneration report contains the information
required in section 6-16 b of the Norwegian Public Limited Liability Companies Act and the accompanying
regulation and that the information in the remuneration report is free from material misstatements. We
conducted our work in accordance with the International Standard for Assurance Engagements (ISAE)
3000 – “Assurance engagements other than audits or reviews of historical financial information”.
We obtained an understanding of the remuneration policy approved by the general meeting. Our
procedures included obtaining an understanding of the internal control relevant to the preparation of the
remuneration report in order to design procedures that are appropriate in the circumstances, but not for
the purpose of expressing an opinion on the effectiveness of the company’s internal control. Further we
performed procedures to ensure completeness and accuracy of the information provided in the
remuneration report, including whether it contains the information required by the law and accompanying
regulation. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Penneo dokumentnøgle: 1KWNT-Z82AK-ATAU3-DLBLH-LP1E2-B6YQX
2
Independent auditor’s assurance report on remuneration report - Magnora ASA 2021
A member firm of Ernst & Young Global Limited
Kristiansand, 20 March 2023
ERNST & YOUNG AS
The auditor's assurance report is signed electronically
Espen Fyllingen
State Authorised Public Accountant (Norway)
Penneo dokumentnøgle: 1KWNT-Z82AK-ATAU3-DLBLH-LP1E2-B6YQX
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Penneo Dokumentnøkkel: 1KWNT-Z82AK-ATAU3-DLBLH-LP1E2-B6YQX
RESPONSIBILITY STATEMENT
We confirm, to the best of our knowledge, that the financial statements for the period January 1 to December 31,
2022, have been prepared in accordance with current applicable accounting standards, and give a true and fair
view of the assets, liabilities, financial position and profit and loss of Magnora ASA as well as the consolidated group.
We also confirm that the Board of Directors’ Report includes a true and fair review of the development and
performance of the business and the position of the Company and the Group, together with a description of the
principal risks and uncertainties facing the Company and the Group.
Oslo, Norway, 20 March 2023
The Board of Directors of Magnora ASA
Torstein Sanness
Chairman
Hilde Ådland
Board member
John Hamilton
Board member
Erik Sneve
CEO
Magnora ASA Karenslyst Allé 6,
0277 Oslo, Norway
www.magnoraasa.com
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