Annual Report • Mar 15, 2024
Annual Report
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AN INNOVATIVE TECHNOLOGY COMPANY SOLVING A PRESSING ISSUE,
| Table of Contents | ||
|---|---|---|
| This is Soiltech | 3 | |
| A |
4 | |
| 3 | 5 | |
| Members of the Board | 9 | |
| Consolidated financial statements | 12 | |
| Notes to the Consolidated financial statements | 17 | |
| 44 | ||
| Notes to the Parent | 49 | |
| Independent Auditors report | 62 | |
Soiltech is an innovative technology company specializing in the treatment, recycling and responsible handling of contaminated water and solid industrial waste streams at site. Our technologies enable cost savings and lower CO2 emissions through waste reduction, waste recovery and reuse. Soiltech operates world-wide, with its head office at Forus in Sandnes, Norway.
Soiltech is on a fantastic journey, and I am proud to be part of it. We develop and operate innovative technologies needed for sustainable treatment, handling, treatment, and recycling of waste. Our solutions contribute to reduced carbon emissions in a world with growing energy demands.
We see an increased demand across our full technology portfolio, due to the dedicated Soiltech team and focus on delivering innovative solutions and strong operations. I am very pleased that we once again can deliver good safety results with no lost time incidents in 2023. We are getting great feedback from our clients when it comes to our operational performance, thanks to our committed personnel on location and onshore support team. This positive feedback is important for Soiltech as operational excellence is a key factor for our continued success.
We reached a milestone in 2023 with revenues exceeding 200 million kroner for the first time. It took us ten years to get to the first 100 million and only two years to double that. During last year, the number of employees increased from 72 to 125, addin Fortunately, our recruitment campaigns attract huge interest from qualified personnel. We continue to focus on continuous improvement, with training,
competence enhancement, and technology innovation as key areas.
Our international operations are growing, while the North Sea market continue to be very strong for Soiltech. In 2023, international operations accounted for 27% of our revenues compared to 16% in 2022. Going forward, I expect that our international activities will continue to increase, as we see tightening regulations for discharging water to sea and further demands for decarbonization. and effective technologies, and we will leverage off our strong position in the North Sea to gain market share globally. There are about 500 mobile rigs worldwide, constituting the market for Soiltech. We are currently on 25 of these rigs, so there is a big untapped potential.
Financially, we are running a solid business. With growing investments in equipment and personnel, capital discipline and a good finance structure is important. I am glad to say that we feel strong support from our banks and owners, which have provided us with the required capital to finance our growth. At some point a listing of Soiltech on Oslo Stock Exchange will be a natural step in order to secure additional equity financing and provide a marketplace for trading of the Soiltech share.
Jan Erik Tveteraas, CEO
Established in 2011, Soiltech is an innovative technology company specializing in the treatment, recycling and responsible handling of contaminated water and solid waste at site. Our technologies enable cost savings and lower CO2 emissions through waste reduction, waste recovery and reuse.
Soiltech (the Group) consists of the Parent Company Soiltech AS (the Company) and the subsidiaries Soiltech Offshore Services AS and Sorbwater Technology AS.
In 2023, the Group had operations in Norway, the United Kingdom, the Netherlands, Mexico, Colombia, Mauritania, Lebanon, Cyprus, Denmark and Abu Dhabi. The Groups Norway.
| Parent company | Group | |||
|---|---|---|---|---|
| Key figures (NOK mill) | 2023 | 2022 | 2023 | 2022 |
| Revenues | 229 | 178 | 229 | 178 |
| Gross Margin | 97 | 80 | 94 | 79 |
| Gross Margin % | 42% | 45% | 41% | 44% |
| EBITDA from Operations | 52 | 43 | 51 | 45 |
| Profit before tax | 32 | 20 | 32 | 19 |
| Net profit | 26 | 16 | 27 | 15 |
| Total assets | 358 | 275 | 351 | 270 |
| Net interest bearing debt | 96 | 35 | 93 | 32 |
| Cash | 24 | 36 | 27 | 39 |
| Working Capital | 3 | 17 | 17 | 20 |
| Equity | 170 | 144 | 171 | 142 |
| Equity ratio | 48% | 52% | 49% | 53% |
As from 2023 the Group has changed its financial reporting from NGAAP to IFRS. The change has been implemented retrospectively using 01.01.2022 as the date of transition. The effects of the transition are limited and are not considered to have a material impact on the figures presented in the annual report, see note 26 in the consolidated financial statement.
The activity has been high throughout the year and the success can be attributed to an increasing demand for the Group their carbon emissions. The revenue growth year on year was 28.5%. The gross margin was 41% and EBITDA from operations was MNOK 51 in 2023, compared to MNOK 45 in 2022.
Profit before tax was MNOK 32. As of 31.12.23, the basis for a contingent liability assumed in connection with the Sorbwater transaction was not fulfilled. Therefore, a gain of MNOK 15 was recognized and goodwill of MNOK 5.1 was impaired, resulting in a net gain of MNOK 9.9. The net profit of MNOK 27 is transferred to other equity. Total assets at year-end amounted to MNOK 351 (MNOK 270).
The cash flow from operating activities reached MNOK 37, while cash flow from investing activities was MNOK -64 due to our capacity expansion initiatives. Following a net contribution of MNOK 15 from financing activities, the net cash flow for the full year of 2023 stood at MNOK -12. The cash position on December 31, 2023 was MNOK 27 and the equity ratio remained solid at 49% (53%). In the middle of 2023 Soiltech entered a long-term loan facility with Sandnes Sparebank. The 7-year loan facility is MNOK 73 and comes in addition to the existing facility of MNOK 75.
Net profit of MNOK 26 is transferred to other equity. Total assets at year-end amounted to MNOK 358 (MNOK 277). The equity ratio remained solid at 48% (52%).
The Group saw an increase in operations in 2023, with higher activity across the full technology portfolio. During the year, we had up to 25 slop treatment operations and two cutting handling projects ongoing. In addition, the Group performed cleaning and swarf removal jobs. International operations are increasing. During 2023, the Group had operations in 10 countries and international revenues accounted for 27% of total revenues. There were no operational or commercial downtime in 2023.
The Group categorizes its primary risks into commercial, operational, compliance and legal, financial and IT- and cyber related risks. The Group has evaluated the overall climate risk to be low. Climate related matters are not expected to critically effect assets, provisions, or future cash flows. Further details can also be found in note 18 and 19 in the consolidated financial statements.
Commercial risks include such risks as macro indicators, suppliers, partners, competitors, and technology. Operational risks include technical and operational status and performance of its equipment as well as HSEQ. Compliance and legal risks include the management system, certifications as well as contractual, legal, and regulatory understanding and compliance. Financial risk includes quality in continuous reporting and internal controls, proper financing and financing sources, forecasting and liquidity management as well as financial risk management related to interest rates, foreign exchange, credit risks and tax risks. IT and cyber risks include the Group
The Group reviews, reporting, forecasting and other mitigating measures. While the Company operates in a cyclical industry, its client base however consists of solid and credit-worthy energy and drilling companies. During the year, the Group has focused on continuous improvement in training and competence requirements, technical and operational safety as well as planning and forecasting.
The Group has a solid balance sheet and had no trade losses in 2023. A new bank facility was secured during the year and a solid cash position was maintained.
Climate risk is defined as the measure of vulnerability to climate-related impacts that may have financial consequences, or that may affect various aspects of financial performance. Those consequences could be reducing the uncertainty of that outcome is business critical.
The overall focus regarding the external environment is to provide knowledge to the market about our technologies, which help the customer reducing their emissions. Overall, this will result in a reduction in emissions that benefits the society. A main Soiltech focus area is to reduce the number of trucks to lower the mobilizations and load the truck as full as possible.
The Group ies are energy efficient technologies that contribute to waste reduction, waste recovery and reuse. As such we are contributing to responsible resource management and reduced emissions through the energy transition. As emissions and discharge regulations are tightened globally, the Group technologies may play an increasingly important role in the oil & gas industry.
The Company has in place a Directors & Officers liability insurance that covers Directors of the Board and executive management. The limit of the coverage is MNOK 50.
The Group has a strong focus on innovations but does not undertake specific research & development activities as such. However, the Group is continuously focusing on improving existing technologies and developing new solutions, based on experience from operations and market needs.
The Group had 125 employees at end 2023 compared to 94 end 2022. The board perceives that the working environment and the general well-being in the workplace as good. This was confirmed in the 2023 organizational survey.
The Group diversity is exemplified by the fact that its employees come from multiple countries. The field personnel consist of men. The Group has incorporated guidelines aiming to ensure that there is no discrimination based on gender or nationality. The Group works systematically with recruitment, salary and working conditions, and promotion and development opportunities. The management team consist of 3 women and 4 men. The board has five members, all of whom are men. One board member is employed as COO in the Company. The Company is in process of making necessary changes to the board to meet the gender requirements by end of 2024.
A fit for purpose management system and robust HSEQ performance is fundamental to the Group. The Company is recertified according to ISO 9001 (Quality), ISO 14001 (Environment) and ISO 45001 (Working Environment). The Group requests and receives continuous feedback from its clients, in an effort to measure quality and continuous improvement. A high degree of repeat clients is an additional quality parameter that is monitored. The Group had a sick leave of 2.4% in 2023. The board perceives the working environment and the general wellbeing in the workplace as good.
Soiltech has a zero-accident philosophy when it comes to incidents and spills and strives on a continuous basis to reduce the impact of its activities on the external environment. The HSE performance in 2023 was good, with no lost time incidents (LTIs). Internal control in Soiltech is ensured in accordance with our policies and procedures, and reinforced based on the organizational structure, competence, and authority matrix as well as segregation of duties.
The Group will listen to stakeholders and continue to shape our business in a sustainable direction. We within the Group to further develop our technologies, towards a greener future. We will conduct our business in a socially responsible manner consistent with the UN Guiding Principles on Business and Human Rights and the Ten Principles of the UN Global Compact.
We respect all internationally recognized human rights, including those embedded in the Universal Declaration of Human Rights, the UN Convention on Economic, Social and Cultural Rights, the UN Convention on Civil and Political Rights and the ILO Declaration on Fundamental Principles and Rights at Work. These rights include, but are not limited to, the freedom of association and the right to bargain, and the right to freedom from forced labor, child labor or discrimination in working life. We also respect current standards in International Humanitarian Law including the Transparency Act which aims to reduce the risk of human rights violations, avoid modern slavery, and ensure decent working conditions. Statement of Transparency act can be found on www.soiltech.no.
The outlook is positive. Soiltech's market-leading technologies for waste reduction, recovery, and reuse continue to gain momentum and market share. The total market for waste treatment is growing, as environmental restrictions for discharging contaminated water tighten world-wide. Going into 2024, Q1 typically has a lower activity due to the winter season. For 2024 as a whole, we foresee a continued strengthening in the market, which is also expected for 2025.
The Board emphasizes that any forward-looking statements contained in this report could depend on factors beyond its control and are subject to risks and uncertainties. Accordingly, actual results may differ materially.
have been prepared on the basis of going concern assumption ref. IAS 1.
At the end of 2023 Soiltech had 87 shareholders. The 10 largest shareholders owned 75.5% of the company. Foreign ownership was 32.4%. As at end 2023, Soiltech had an issued share capital of NOK 740 543 and 7 405 430 outstanding shares, each with a nominal value of NOK 0.10 and carrying equal voting rights.
Soiltech has not paid any dividend to date and the Board does not propose to pay dividend for 2023. Soiltech is a growth company, and we are aiming at a continued growth, based on a solid financial position. Our plan is to take advantage of market opportunities and reinvest the generated cash in profitable projects and enhanced service capacity. Any future dividend will be evaluated on this basis. financial position and profits of the Group other than those mentioned under Events after year-end above.
As far as the Board is aware, there have been no significant events since year-end which would impact the ____________________ ____________________ ____________________ Carsten Brückner
Sandnes, March 15, 2024
The board of directors of Soiltech AS
____________________ ____________________ ____________________
Gunnar Winther Eliassen
Chairman of the Board Olaf Skrivervik Member of the Board
Eirik Flatebø Member of the Board
Member of the Board Glenn Åsland Member of the Board
Jan Erik Tveteraas Chief Executive Officer
Gunnar Winther Eliassen Chairman og the board
Eirik Flatebø Board member
Glenn Åsland Board member
Dennis Alberding Deputy board member
Olaf Skrivervik Board member
Dr. Carsten Brückner Board member
| (amounts in NOK 1000) | Note | 2023 | 2022 |
|---|---|---|---|
| Revenue | 3 | 229 112 | 177073 |
| Other operating income | 3 | 167 | 1097 |
| Total operating income | 3 | 229 279 | 178 170 |
| Cost of materials | $-39696$ | -33 499 | |
| Personnel expenses | 4 | $-115990$ | $-90104$ |
| Depreciation and amortisation | 5,9,10,11 | $-17930$ | $-16032$ |
| Impairment | 9 | $-5050$ | 0 |
| Other operating expenses | 6 | $-25442$ | $-15857$ |
| Total operating expenses | $-204$ 109 | $-155492$ | |
| Other gains | 9,22 | 15 000 | 0 |
| Operating profit | 40 170 | 22 678 | |
| Net foreign exchange gains (losses) | 7 | 186 | -138 |
| Financial income | 7 | 296 | 539 |
| Financial expenses | 7 | $-8371$ | $-4277$ |
| Net financial items | -7890 | $-3876$ | |
| Profit before tax | 32 280 | 18 803 | |
| Income tax expense | 8 | -4 869 | $-4146$ |
| Profit for the period | 27 411 | 14 657 | |
| Other comprehensive income | |||
| Items that may be reclassified to profit or loss | |||
| Currency translation differences | 0 | 0 | |
| Income tax relating to these items | 0 | 0 | |
| Net other comprehensive income | 0 | 0 | |
| Total comprehensive income for the period | 27 411 | 14 657 | |
| Total comprehensive income is attributable to: | |||
| Owners of Soiltech AS | 27 411 | 14 657 | |
| TRANSFERS | |||
| Transfers to other equity | 27 411 | 14 657 | |
| Total allocations | 27 411 | 14 657 | |
| Earnings per share (NOK) | |||
| Basic earnings per share | 21 | 3,70 | 1,98 |
| Diluted earnings per share | 21 | 3,44 | 1,86 |
| (amounts in NOK $1000$ ) | ||||
|---|---|---|---|---|
| ASSETS | Note | 31/12/2023 | 31/12/2022 | 01/01/2022 |
| Non-current assets | ||||
| Deferred tax assets | 8 | 10 403 | 15 2 7 2 | 0 |
| Intangible assets | 9 | 1811 | 6795 | 461 |
| Property, plant & equipment | 10 | 181 117 | 130 300 | 88 968 |
| Right-of-use assets | 11 | 71 140 | 40 352 | 39 649 |
| Investments in subsidiaries | 0 | 0 | ||
| Other non-current assets | 12 | 762 | 738 | 294 |
| Total non-current assets | 265 234 | 193 457 | 129 372 | |
| Receivables | ||||
| Inventories | 159 | 238 | 0 | |
| Trade receivables | 13 | 44 195 | 29 244 | 34 321 |
| Cash and cash equivalents | 14 | 26 783 | 38 8 32 | 39 232 |
| Other current assets | 12 | 14 310 | 8047 | 16 059 |
| Total current assets | 85 447 | 76 362 | 89 612 | |
| TOTAL ASSETS | 350 681 | 269818 | 218 984 | |
| EQUITY AND LIABILITIES Equity |
Note | 31/12/2023 | 31/12/2022 | 01/01/2022 |
| Share capital | 20 | 741 | 741 | 720 |
| Other paid-in equity | 83 948 | 83 948 | 70 045 | |
| Other reserves | 1826 | 1 1 3 2 | 0 | |
| Retained earnings | 84 050 | 56 639 | 41 983 | |
| Total equity | 170 565 | 142 460 | 112 748 | |
| LIABILITIES | ||||
| Borrowings | 14,15 | 68 913 | 38 892 | 31 144 |
| Lease liabilities | 11,14 | 41847 | 16 742 | 19808 |
| Deferred tax liabilities | 0 | 0 | 5898 | |
| Other non-current liabilities | 12 | 669 | 15 796 | 966 |
| Total non-current liabilities | 111 429 | 71 430 | 57817 | |
| Current liabilities | ||||
| Trade payables | 17 | 13 153 | 9017 | 13780 |
| Borrowings | 14,15 | 16 860 | 13 3 25 | 6370 |
| Lease liabilities | 11 | 10 4 09 | 8820 | 6 2 4 1 |
| Tax payable | 8 | 0 | 0 | 931 |
| Other current liabilities | 12 | 28 265 | 24 7 67 | 21 099 |
| Total current liabilities | 68 687 | 55 929 | 48 4 21 | |
| Total liabilities | 180 116 | 127 359 | 106 238 | |
| Total equity and liabilities | 350 681 | 269818 | 218 984 |
Sandnes, March 15, 2024
Gunnar Winther Eliassen
____________________ ____________________ ____________________
Carsten Brückner
Chairman of the Board Olaf Skrivervik Member of the Board
____________________ ____________________ ____________________
Eirik Flatebø Member of the Board
Member of the Board Glenn Åsland Member of the Board
Jan Erik Tveteraas Chief Executive Officer
| Note | 2023 | 2022 | |
|---|---|---|---|
| Cash flows from operating activities | |||
| Profit before tax | 32 280 | 18803 | |
| Income taxes paid | 8 | 0 | $-933$ |
| Depreciation, amortisation and impairment | 5 | 22 980 | 16 032 |
| Interest expense | $\overline{7}$ | 7757 | 4 2 2 1 |
| Other gains | 9 | $-15000$ | 0 |
| Profit/(loss) on investing activities | 0 | $-982$ | |
| Changes in trade receivables, contract | |||
| assets/liabilities | $-14533$ | 6555 | |
| Changes in trade payables | 2 186 | -4 596 | |
| Changes in other accruals and prepayments | 1078 | 6617 | |
| Net cash flow from operating activities | 36748 | 45716 | |
| Cash flows from investment activities | |||
| Purchase of property, plant & equipment & | |||
| Intangible assets | 9,10 | $-64028$ | -49 900 |
| Sale of property, plant and equipment | 10 | 0 | 1 2 5 0 |
| Investment in subsidiary net of cash acquired | 22 | 0 | -467 |
| Net cash flow from investment activities | $-64028$ | -49 117 | |
| Cash flows from financing activities | |||
| Proceeds from new borrowings | 45 561 | 25 301 | |
| Repayments on borrowings | 14 | $-13226$ | $-10371$ |
| Payment of principal portion of lease liabilities | 11,14 | $-10567$ | $-7518$ |
| Interest paid | 14 | $-6537$ | -4 4 4 8 |
| Proceeds from capital increase | 0 | 55 | |
| Net cash flow from financing activities | 15 231 | 3019 | |
| NET CASH FLOW FOR THE PERIOD | $-12049$ | $-400$ | |
| Cash and cash equivalent 01 01 | 38 832 | 39 232 | |
| Cash and Cash equivalents 31.12 | 26 783 | 38 832 |
| CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
|||
|---|---|---|---|
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS Soiltech AS (the 'Company') is a limited company domiciled in Norway. The registered office of the Company is Koppholen 25, 4313, Sandnes, Norway.
The Company is an innovative technology company specializing in the treatment, recycling and responsible handling of contaminated water and solid industrial waste streams on site. The Company is listed on the NOTC in Oslo with ticker code 'SOIL'. The consolidated financial statements comprise the financial statements of the Company and its subsidiaries (together referred to as the 'Group').
The consolidated financial statements for the year ended 31 December 2023 were approved and authorized for issue in accordance with a resolution of the board of directors on 19th of March 2024.
The Group presents consolidated financial statements in accordance with IFRS® Accounting Standard* for the first time. In previous years, the consolidated financial statements were prepared in accordance with Norwegian Generally Accepted Accounting Principles (NGAAP). Date of transition to IFRS is 1 January 2022 and all comparative figures have been restated accordingly. Reference is made to note 26 for details on the effects of the transition.
The general accounting policies applied in the preparation of these consolidated financial statements are set out below. Specific accounting policies related to the individual areas in the financial statements are described in the relevant notes.
The consolidated financial statements have been prepared in accordance with the IFRS as adopted by the (EU) and additional disclosure requirements in the Norwegian Accounting Act as effective of 31 December 2023. The consolidated financial statements are presented in Norwegian Kroner (NOK) and have been rounded to the nearest thousand unless otherwise stated. As a result of rounding adjustments, amounts and percentages may not add up to the total. The financial statements are prepared on a going concern basis.
Items in the financial statements are to a varying degree affected by estimates and assumptions made by management, reference is made to the relevant notes for the affected items. Estimates with a material impact on the financial statements, combined with a significant estimation uncertainty, comprise the following: - Recognition of deferred tax asset (note 8).
Given the uniform nature of the Group's services and the centralized management from its head office in Norway, the entire Group is considered as a single operating segment for internal reporting purposes.
The companies within the Group primarily use NOK as their functional currency. For consolidation purposes, the translated using the closing rate at the balance sheet date. Income and expenses for each income statement are translated using the yearly average exchange rate.
Of new standards and interpretations that are not mandatory for the current reporting period, none are expected to have a material impact on the entity in the current or future reporting periods and on foreseeable future transactions.
The Group's revenue mainly derives from the sale of services related to treatment of contaminated water (i.e. slop), cuttings handling, cleaning services and other related services, for customers within the oil & gas industry. The key element of the service deliveries is the deployment and supervision of treatment and handling equipment at the customer's site, to meet the specific purification targets defined in the contracts
The contract consideration is composed mainly of agreed daily rates for equipment and personnel, respectively, and reimbursement of costs plus a markup. Rates vary depending on whether the equipment is in active use during ongoing operations or in standby, for example when the equipment is on location but not in Operation. Typically, the contract deliveries follow the operation on the rig. However, all contracts can be terminated by the customer without cause on a short notice, with only completion of existing work order.
Costs of mobilization and demobilization of equipment and personnel are normally recovered through the agreed daily rates, except for some contracts, where they are reimbursed separately. Such reimbursement is, however, generally not material in relation to the total contract consideration. Consideration is normally invoiced monthly, based on actual deliveries.
The contracts are considered to consist of only one performance obligation, which is satisfied over time. Progress is measured on the basis of the time the Slop treatment unit (STT) is available to service the customer. In practice, revenue based on daily rates are thus recognized with the amount that the Company has a right to invoice. As a practical simplification based on materiality, any fees associated with mobilization and demobilization are recognized linearly over the period of the related contract.
Cost of mobilization is considered to be cost to fulfil a contract and are recognized as an asset when incurred. The asset is subsequently amortized over the contract period, as cost of materials and personnel expenses.
| Year to date | ||
|---|---|---|
| (amounts in NOK 1000) | 2023 | 2022 |
| Slop- and water treatment services | 153 033 | 128 368 |
| Other revenue* | 76 246 | 49 802 |
| Total | 229 279 | 178 170 |
*Other revenue is revenue from cuttings handling, cleaning services, swarf handling and associated services.
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Norway | 167 007 | 149 289 |
| International* | 62 272 | 28 8 8 1 |
| Total | 229 279 | 178 170 |
*International revenue comes mainly from UK, Netherlands, Abu Dhabi and other countries.
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Customer 1 | 68 579 | 59 379 |
| Customer 2 | 39 4 54 | 30 595 |
| Customer 3 | 27 5 32 | 20 40 6 |
| Customer 4 | 23 4 54 | 27 0 28 |
| Total from major customers | 159 019 | 137 408 |
| Other (less than 10% each) | 70 260 | 40 762 |
| Total | 229 279 | 178 170 |
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Carrying amount 01.01. | 1472 | |
| Incurred during the period | 3 9 6 5 | 0 |
| Amortised during the period | $-1472$ | |
| Carrying amount 31.12. | 3 9 6 5 | 0 |
Personnel costs are expensed as the employees earn the right to the payment of wages for hours worked. Payments to defined contribution pension plan are expensed over the period in which the employees earn the right to the deposit.
The Group follow the stipulations in the Norwegian Mandatory Occupational Pensions Act. The Group's pension scheme adheres to the requirements, as set in the Act.
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Wages and salaries | 87 766 | 72 305 |
| Contract personnel | 2667 | 1798 |
| Pension contributions | 4 0 1 0 | 2885 |
| Social security tax | 14 751 | 11 3 18 |
| Other personnel expenses* | 6796 | 1798 |
| Total | 115 990 | 90 104 |
*Other personnel expenses include expenses relating share-based payment transactions. Refer to note 24 for further details.
| 31/12/2023 | 31/12/2022 | |
|---|---|---|
| Norway | 106 | 81 |
| United Kingdom | 13 | |
| Other | ь | 6 |
| Total | 125 | 94 |
| (amounts in NOK 1000) | Note | 2023 | 2022 |
|---|---|---|---|
| Amortisation of intangible assets | 10 | 146 | |
| Depreciation property, plant & equipment | 11 | 12 015 | 10 9 21 |
| Depreciation of right-of-use assets | 12 | 5769 | 5099 |
| Total | 22 980 | 16 032 |
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Cost of lease of assets of low value | 174 | 185 |
| Audit and Accounting cost | 2 9 6 4 | 1773 |
| Legal advisor cost | 3 5 8 7 | 720 |
| Office cost and it equipment | 4561 | 2679 |
| Travel related cost | 8 2 4 9 | 5 2 7 4 |
| Sales and commercial cost | 1079 | 899 |
| Insurance | 750 | 622 |
| Other cost | 4078 | 3705 |
| Total | 25 4 42 | 15857 |
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Statutory audit fee | 604 | 167 |
| Other certification services | 0 | |
| Tax advisory services | $\Omega$ | |
| Other non-auditing services | 273 | 220 |
| Total | 877 | 387 |
| (amounts in NOK 1000) | Note | 2023 | 2022 |
|---|---|---|---|
| Net foreign exchange gains (losses) | 186 | $-138$ | |
| Interest income | 296 | 539 | |
| Other | ი | ||
| Total financial income | 296 | 539 | |
| Interest expenses on leases | 11,14 | $-2943$ | $-1804$ |
| Interest expenses on borrowings | 14 | $-4816$ | $-2417$ |
| Loss on financial derivatives | 16 | $-591$ | $-68$ |
| Other | $-21$ | 12 | |
| Total financial expenses | $-8371$ | -4 277 | |
| Net financial items | $-7890$ | -3 876 |
The Group consists of companies subject to ordinary corporate taxation in Norway, and within the same tax group with respect to offsetting of deferred tax. Income tax is therefore recognized on the basis of a general application of IAS 12 without the need for further judgments or policies of significance.
Deferred tax assets are recognized when it is probable that the Group will have a sufficient profit for tax purposes in subsequent periods to utilize the tax asset. The Group recognize previously unrecognized deferred tax assets to the extent it has become probable that the Group can utilize the deferred tax asset. Similarly, the Group will reduce a deferred tax asset to the extent that the Group no longer regards it as probable that it can utilize the deferred tax asset. Deferred tax and deferred tax assets are measured based on the expected future tax rates applicable to the companies in the Group where temporary differences have arisen based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. Deferred tax and deferred tax assets are recognized at their nominal value and classified as non-current asset (non-current liabilities) in the consolidated statement of financial position.
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Tax payable | ||
| Change in deferred tax | 4869 | 4 146 |
| Change in tax expense for previous years | ||
| Income tax expense | 4869 | 4 1 4 6 |
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Profit (loss) before tax | 32 280 | 18 803 |
| Tax at nominal rate in Norway (22 %) | 7 1 0 2 | 4 1 3 7 |
| Permanent differences | 2 2 0 5 | 35 |
| Effect of different tax rates in foreign operations | 0 | 0 |
| Change in deferred tax not recognised | 28 | 25 |
| Income tax expense | 4869 | 4 1 4 6 |
| Effective tax rate | 15% | 22% |
Permanent differences come mainly from reversal of contingent liability MNOK 15 and impairment of goodwill MNOK -5, with a net impact MNOK 10 and a tax impact of MNOK 2.2. For further information see note 9.
| (amounts in NOK 1000) | 31/12/2022 Profit or loss | OCI | 31/12/2023 | |
|---|---|---|---|---|
| Fixed assets | 17 0 64 - | 2 2 9 6 | $0 -$ | 19 3 5 9 |
| Customer contracts | 0 | 0 | 0 | 0 |
| Other | $173 -$ | 838 | $0 -$ | 1011 |
| Total deferred tax liabilities | 17 236 - ٠ |
3 1 3 3 | $0 -$ | 20 370 |
| Reclass between deferred tax liabilities and assets | 17 236 | 3 1 3 3 | 0 | 20 370 |
| Net deferred tax liabilities | $\overline{\phantom{a}}$ | $\mathbf{0}$ | 0 | |
| Fixed assets | 0 | 0 | 0 | $\overline{0}$ |
| Tax losses carried forward | 24 011 - | 2080 | 0 | 21931 |
| Other | 8673 | 317 | 0 | 8989 |
| Total deferred tax assets | 32 683 - | 1763 | 0 | 30 920 |
| Reclass between deferred tax liabilities and assets | $17236 -$ | 3 1 3 3 | $0 -$ | 20 370 |
| Non-recognized deferred tax assets | 175 | 28 | $0 -$ | 147 |
| Net deferred tax assets | 15 272 - | 4869 | 0 | 10 403 |
| Specification of deferred tax liabilities and assets | 2022 | Business | ||||
|---|---|---|---|---|---|---|
| comb | ||||||
| (amounts in NOK 1000) | 01/01/2022 | Profit or loss OCI |
ination | Other | 31/12/2022 | |
| Fixed assets | -11 710 | -3 817 | 0 | -1 537 | 0 | -17 064 |
| Customer contracts | 0 | 0 | 0 | 0 | 0 | 0 |
| Other | 0 | -173 | 0 | 0 | 0 | -173 |
| Total deferred tax liabilities | -11 710 | -3 990 | 0 | -1 537 | 0 | -17 237 |
| Reclass between deferred tax | ||||||
| liabilities and assets | 6 012 | 3 964 | 0 | 1 537 | 5 898 | 17 412 |
| Non-recognized deferred tax assets | -200 | 25 | 0 | 0 | 0 | -175 |
| Net deferred tax liabilities | -5 899 | 0 | 0 | 0 | 5 898 | 0 |
| Fixed assets | 0 | 0 | 0 | 0 | 0 | 0 |
| Tax losses carried forward | 0 | -1 759 | 0 | 25 770 | 0 | 24 011 |
| Other | 6 012 | 1 578 | 0 | 1 083 | 0 | 8 673 |
| Total deferred tax assets | 6 012 | -181 | 0 | 26 853 | 0 | 32 684 |
| Reclass between deferred tax | ||||||
| liabilities and assets | -6 012 | -3 964 | 0 | -1 537 | -5 898 | -17 411 |
| Non-recognized deferred tax assets | 0 | 0 | 0 | 0 | 0 | 0 |
| Net deferred tax assets | 0 | -4 145 | 0 | 25 316 | -5 898 | 15 272 |
Intangible assets mainly comprise goodwill originating from previous acquisitions. Goodwill is not depreciated but is instead subject to annual impairment testing. Other intangible assets include patents and software which are recognised in accordance with the cost method and depreciated over their expected economic lifetime.
| (amounts in NOK 1000) | Goodwill | Other | Total |
|---|---|---|---|
| Cost 01.01.2022 | $\mathbf{0}$ | 2061 | 2061 |
| Additions | $\overline{0}$ | 621 | 621 |
| Addition business combination | 5051 | 675 | 5726 |
| Cost 31.12.2022 | 5051 | 3 3 5 7 | 8 4 0 8 |
| Additions | $\mathbf 0$ | 213 | 213 |
| Disposals | $\mathbf 0$ | 0 | $\Omega$ |
| Cost 31.12.2023 | 5051 | 3570 | 8621 |
| Accumulated depreciation 01.01.2022 | $\overline{0}$ | 1500 | 1500 |
| Depreciations for the year | $\mathbf 0$ | 12 | 12 |
| Accumulated depreciation 31.12.2022 | $\mathbf 0$ | 1512 | 1512 |
| Accumulated impairment 01.01.2022 | $\mathbf 0$ | 100 | 100 |
| Impairment for the year | 0 | $\Omega$ | $\Omega$ |
| Accumulated impairment 31.12.2022 | $\mathbf 0$ | 100 | 100 |
| Depreciations for the year | $\mathbf 0$ | 146 | 146 |
| Accumulated depreciation 31.12.2023 | $\mathbf 0$ | 1658 | 1658 |
| Impairment for the year | 5051 | $\mathbf 0$ | 5 0 5 1 |
| Accumulated impairment 31.12.2023 | 5051 | 100 | 5 1 5 1 |
| Carrying amount 01.01.2022 | $\mathbf 0$ | 561 | 561 |
| Carrying amount 31.12.2022 | 5051 | 1745 | 6795 |
| Carrying amount 31.12.2023 | $\pmb{0}$ | 1811 | 1811 |
| Economic useful life | Indefinite | 3-5 years | |
| Depreciation schedule | Linear |
A goodwill of MNOK 5.0 was recognized in connection with the acquisition of Sorbwater in 2022. See note 22 for further details. However, the expected synergies from the Sorbwater patented biodegradable chemicals are delayed and the business plan has therefore been revised. Since the timing of the realization of such synergies is uncertain, the goodwill has been impaired in full. The delay in synergies also resulted in certain thresholds under the SPA are uncertain to be met. Consequently, the contingent consideration of MNOK 15 that was recognized as part of the consideration has been reversed and recognized as other gain in 2023.
Property, plant & equipment consists of slop treatment units, equipment for cuttings handling, cleaning services and swarf removal, skips and various other equipment. Property, plant & equipment are recognized in accordance with the cost method and depreciated over their expected economic lifetime.
| Property, plant & | |
|---|---|
| (amounts in NOK 1000) | equipment |
| Cost 01.01.2022 | 122 149 |
| Additions | 49 279 |
| Addition business combination | 3 2 4 2 |
| Disposals | $-268$ |
| Cost 31.12.2022 | 174 402 |
| Additions | 63815 |
| Other non cash adjustments | $-984$ |
| Disposals | 0 |
| Cost 31.12.2023 | 237 233 |
| Accumulated depreciation 01.01.2022 | 29 612 |
| Depreciations for the year | 10921 |
| Accumulated depreciation 31.12.2022 | 40 533 |
| Accumulated impairment 01.01.2022 | 3 5 6 8 |
| Impairment for the year | 0 |
| Accumulated impairment 31.12.2022 | 3 5 6 8 |
| Accumulated depreciation 31.12.2022 | 40 533 |
| Depreciations for the year | 12 016 |
| Accumulated depreciation 31.12.2023 | 52 549 |
| Accumulated impairment 31.12.2022 | 3 5 6 8 |
| Impairment for the year | Ω |
| Accumulated impairment 31.12.2023 | 3 5 6 8 |
| Carrying amount 01.01.2022 | 92 537 |
| Carrying amount 31.12.2022 | 130 300 |
| Carrying amount 31.12.2023 | 181 117 |
| Economic useful life | 5-15 years |
| Depreciation schedule | Linear |
The Group is primarily involved in lease agreements as a lessee. All lease agreements are recognized in accordance with IFRS 16, with the exception of:
Lease agreements with a shorter duration than 12 months
Leases of assets with a cost price below NOK 50 000
Payments relating to such leases are recognized as operating expenses when due. The Group does however not have many such agreements and the annual expense is therefore immaterial.
Right-of-use assets are recognized in accordance with the cost method and depreciated over the lease term, or expected economic lifetime, depending on whether a purchase option is expected to be exercised.
The Group primarily leases premises and slop treatment units (STT). For premises, the lease term is usually between 3 and 10 years, while for slop treatment units between 4 and 7 years. For STT units it is expected that the purchase option is exercised and as such the asset is depreciated over the expected economic lifetime.
In 2023, the Group entered into a new lease agreement for its head office in Sandnes. The lease period is 5 years with 5 years option to extend. The lease liability is calculated based on the lease term including the option period. A new lease agreement was also entered into for the Group premises in Bergen, with a lease period of 3 years. The discount rate used in the new lease calculation is 7,24%.
The Group has leased additional STT units to be delivered in Q2 2024. The present value of the lease liability will be recognised on commencement of the lease.
| Specification of lease liabilities | ||
|---|---|---|
| Index regulation | 300 | |
|---|---|---|
| Interest expenses | 2 9 4 3 | 1804 |
| Lease payments | $-13507$ | $-9321$ |
| Prepayments leasing | 704 | 885 |
| Effect of currency translation | 0 | $\Omega$ |
| Carrying amount 31.12. | 52 256 | 25 5 62 |
| Non-current lease liabilities | 41847 | 16 742 |
| Current lease liabilities | 10 409 | 8820 |
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Due within one year | 12 442 | 12 545 |
| Due within one and five years | 34 195 | 27 399 |
| Due after 5 years | 16 557 | 3838 |
| Total | 63 194 | 43 782 |
| (amounts in NOK 1000) | 31.12.23 | 31.12.22 | 01.01.22 |
|---|---|---|---|
| Restricted cash | 762 | 738 | 171 |
| Other | 123 | ||
| Total | 762 | 738 | 294 |
| (amounts in NOK 1000) | 31.12.23 | 31.12.22 | 01.01.22 |
|---|---|---|---|
| Prepaid expenses | 4 9 5 2 | 3685 | 8 2 5 8 |
| VAT receivable | 2 9 6 0 | 4 1 2 7 | 5 2 2 8 |
| Cost to fulfill customer contract | 3 9 6 5 | 0 | 1472 |
| Tax refund connected to research and | |||
| development | 1905 | 0 | |
| Other | 529 | 235 | 1 1 0 1 |
| Total | 14 3 10 | 8047 | 16 059 |
| (amounts in NOK 1000) | Note | 31.12.23 | 31.12.22 | 01.01.22 |
|---|---|---|---|---|
| Contingent consideration business | ||||
| combination | 9,22 | 15 000 | ||
| Other | 669 | 796 | 55 | |
| Total | 669 | 15796 | 55 |
| (amounts in NOK 1000) | Note | 31.12.23 | 31.12.22 | 01.01.22 |
|---|---|---|---|---|
| Liability relate to currency forward contract | 16 | 3672 | 3 0 8 1 | |
| Public duties payable | 9 5 9 0 | 8877 | 6950 | |
| Liability to employeers incl. holiday pay | 12 3 93 | 11 404 | 10 5 33 | |
| Liability to group companies | ||||
| Other | 2 6 1 1 | 1 4 0 5 | 3 6 1 6 | |
| Total | 28 265 | 24 7 67 | 21 099 |
Trade receivables are recognized at an amount equal to the transaction price, less provisions for expected credit losses. The Group applies the simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables.
| Specification of trade receivables | ||
|---|---|---|
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Amounts written off as uncollectable | ||
| Received on items previously written off | 25 | n |
| Change in loss provision | ||
| Net credit loss recognised in profit or loss | つら |
Cash and cash equivalents comprise mostly ordinary bank deposits. The statement of cash flows is prepared using the indirect method. Interest income and expenses are presented as investing and financing activities, respectively.
| (amounts in NOK 1000) | 31.12.23 | 31.12.22 | 01.01.22 |
|---|---|---|---|
| Payroll withholding tax account | 3 5 2 0 | 2 9 6 5 | 2762 |
| (amounts in NOK 1000) | Lease liabilities | Borrowings | Total |
|---|---|---|---|
| Carrying amount 31.12.2022 | 25 5 62 | 52 217 | 77 779 |
| Cash flows | |||
| Proceeds from new borrowings | 45 5 61 | 45 5 61 | |
| Repayment of principal borrowings | $-13226 -$ | 13 2 2 6 | |
| Repayment of principal portion of lease liability | $-10567$ | 10 5 67 | |
| Interest paid | $-2941$ | $-3596 -$ | 6537 |
| Other changes | |||
| Interest expenses | 2 9 4 3 | 4816 | 7759 |
| Additions lease | 36 555 | 36 555 | |
| Pre invoiced | 704 | 704 | |
| Effect of currency translation | $\mathbf 0$ | 0 | |
| Carrying amount 31.12.2023 | 52 256 | 85 773 | 138 029 |
| Non-current | 41847 | 68 913 | |
| Current | 10 409 | 16860 |
| (amounts in NOK 1000) | Lease liabilities | Borrowings | Total |
|---|---|---|---|
| Carrying amount 01.01.2022 | 26 049 | 37 515 | 63 5 64 |
| Cash flows | |||
| Proceeds from new borrowings | $\Omega$ | 25 301 | 25 301 |
| Repayment of principal | 0 | $-10371 -$ | 10 371 |
| Repayment of principal portion of lease liability | $-7518$ | 7518 | |
| Interest paid | $-1804$ | $-2644 -$ | 4 4 4 8 |
| Other changes | |||
| Interest expenses | 1804 | 2417 | 4 2 2 1 |
| Additional lease | 6 1 4 7 | 6 1 4 7 | |
| Pre invoiced | 885 | 885 | |
| Effect of currency translation | $\Omega$ | $\Omega$ | |
| Carrying amount 31.12.2022 | 25 5 6 2 | 52 217 | 77 780 |
| Non-current | 16 742 | 38 892 | |
| Current | 8820 | 13 3 25 |
Borrowings are initially recognized at fair value, including transaction costs directly attributable to the transaction, and are subsequently measured at amortized cost. There has not been any material transaction cost during the year.
The loan facility with Sandnes Sparebank entered in 2023 has the following covenants:
The company is not in breach with any of the covenants above.
| Nominal interest Nominal amount | Capitalized | Carrying amount | ||
|---|---|---|---|---|
| (amounts in NOK 1000) | rate | financing fees | ||
| Innovasion Norge | 7.7% | 3875 | 3875 | |
| Sandnes Sparebank | 3 m. Nibor + 2.5% | 81898 | 0 | 81898 |
| Carrying amount as per 31.12.2023 | 85 773 | 85 7 73 | ||
| Non-current borrowings | 68 913 | |||
| Current borrowings | 16860 |
| Nominal interest Nominal amount | Capitalized | Carrying amount | ||
|---|---|---|---|---|
| (amounts in NOK 1000) | rate | financing fees | ||
| Innovasion Norge | 6.0% | 6458 | 6458 | |
| Sandnes Sparebank | 3 m. Nibor + 2.5% | 45 758 | 0 | 45 758 |
| Carrying amount as per 31.12.2022 | 52 217 | 52 217 | ||
| Non-current borrowings | 38 892 | |||
| Current borrowings | 13 3 25 |
| Next year | 1-2 years | 2-5 years | More than 5 | |
|---|---|---|---|---|
| (amounts in NOK 1000) | vears | |||
| Innovasjon Norge | 2813 | 1 3 3 0 | 0 | |
| Sandnes Sparebank | 18 5 80 | 17 612 | 47 024 | 14 453 |
| Total | 21 3 9 3 | 18 942 | 47024 | 14 4 53 |
| Next year | 1-2 years | 2-5 years | More than 5 | |
|---|---|---|---|---|
| (amounts in NOK 1000) | vears | |||
| Innovasjon Norge | 2908 | 4 0 7 6 | 0 | |
| Sandnes Sparebank | 13 5 5 5 | 12 776 | 26 090 | 0 |
| Total | 16 4 63 | 16852 | 26 090 | 0 |
For loans with floating interest rates, the amounts above are calculated using the current interest rate per the relevant year end.
| (amounts in NOK 1000) | 31.12.23 | 31.12.22 | 01.01.22 |
|---|---|---|---|
| Property, plant & equipment | 180 954 | 127 230 | 88 968 |
| Trade receivables | 44 171 | 29 3 38 | 34 321 |
| Total | 225 124 | 156 568 | 123 289 |
Financial derivatives consist of currency forward contracts. Although the contracts are held for hedging purposes, the Group does not apply hedge accounting. The forward contracts are measured at fair value through profit or loss. Gains and losses are presented as financial income or expense, respectively. Currency forward contracts are measured at level 2 in the fair value hierarchy, as the present value of future cash flows is based on the forward exchange rates at the balance sheet date.
A currency forward contract of MUSD 0.74 was entered into in relation to the sale of certain equipment to Kuwait in 2014, in the Group subject to significant uncertainty. The forward contract has been rolled forward multiple times pending a final outcome, and the current contract matures at 04.03.2024. At year end the liability was MNOK 3.7. This is included in the statement of financial position under Other current liabilities.
| (amounts in NOK 1000) | 31.12.23 | 31.12.22 | 01.01.22 |
|---|---|---|---|
| Financial assets at amortised cost | |||
| Trade receivables | 44 195 | 29 244 | 34 321 |
| Other assets | 14 3 10 | 8047 | 16 059 |
| Financial assets at fair value through profit or loss | |||
| Cash and cash equivalents | 26 783 | 38 832 | 39 2 32 |
| Carrying amount as at 31.12.23 | 85 288 | 76 124 | 89 612 |
| (amounts in NOK 1000) | 31.12.23 | 31.12.22 | 01.01.22 | |||
|---|---|---|---|---|---|---|
| Current | Non-current | Current | Non-current | Current | Non-current | |
| Financial liabilities at amortised cost | ||||||
| Borrowings | 16 860 | 68 913 | 13 3 25 | 38 892 | 6370 | 31 144 |
| Lease liabilities | 10 4 09 | 41847 | 8820 | 16 742 | 6 2 4 1 | 19808 |
| Trade payables | 13 15 3 | 9017 | 13780 | |||
| Financial liabilities at fair value through profit or loss | ||||||
| Currency forward contracts | 3672 | 3 0 8 1 | 0 | $\Omega$ | $\Omega$ | |
| Carrying amount as at 31.12 | 44 094 | 110 760 | 34 243 | 55 634 | 26 391 | 50 952 |
For items measured at amortized cost, carrying amount is considered to be a reasonable approximation to fair value.
The policies for management of capital and financial risk aim to support the current strategy and target of maintaining a high rate of growth and developing prospective business opportunities. The Group structure shall be robust enough to maintain the desired freedom of action and utilize growth opportunities, based on strict assessments relating to the allocation of capital. The Group debt financing consist of bank and leasing financing. The loan covenants to which the Group is subject play a key role in how capital is managed and allocated, to maintain a low financing risk and financial flexibility. See note 15 borrowings for further details on
The Group's exposure to financial market risk is mainly related to interest rates on external financing and various forms of currency risks. The Group has a diversified client list and evaluates changes in pricing structure contract by contract, as part of its mitigation process to cover for increased interest cost. The Group has not entered into any interest swap agreements.
The Group has Norwegian kroner (NOK) as its base currency. However, through its operations outside Norway, the Group is exposed to fluctuations in certain exchange rates, mainly Euro (EUR), British Pound (GBP) and
American dollar (USD). The Group also has currency risks linked to both balance sheet monetary items and investments in foreign countries. The tables below show end. As the Group does not apply hedge accounting, the impact on profit/loss and equity will be the same regardless of the direction of the exchange rate change.
| (amounts in NOK 1000) | USD | EUR | GBP | SUM NOK | |
|---|---|---|---|---|---|
| Trade receivables | 11 190 | 851 | 5 5 1 7 | 17 558 | |
| Cash and cash equivalents | 3076 | 912 | 3827 | 7814 | |
| Trade payables | $\sim$ | 65 | 0 | 0 - | 65 |
| Currency forward contracts | - | 7 494 | 0 - | 7494 | |
| Net exposure | 6707 | 1762 | 9 3 4 4 | 17813 |
| (amounts in NOK 1000) | USD | EUR | GBP | SUM NOK | |
|---|---|---|---|---|---|
| Trade receivables | 978 | 3 1 7 9 | 3 7 5 4 | 7911 | |
| Cash and cash equivalents | 110 | 644 | 3 0 4 2 | 3796 | |
| Trade payables | $\blacksquare$ | 1 7 0 4 | 0 | $-136$ – | 1841 |
| Currency forward contracts | - | 7 267 | 0 | 0- | 7 2 6 7 |
| Net exposure | $\blacksquare$ | 7883 | 3823 | 6660 | 2 5 9 9 |
The Company loan and leasing agreements have floating interest rates based on NIBOR according to the financial strategy, see Note 15 borrowings, and is thereby influenced by changes in the interest market. A change of increase of 1 percentage point in NIBOR means a change in yearly net interest expenses of approximately MNOK 1.5.
Assets that may give rise to credit risk comprise mainly trade receivables and bank deposits. For the latter, the counterparties are mainly banks established in the Nordic countries, which indicates that the credit risk should be regarded as negligible. Trade receivables are characterized by a concentration in the customer base, in terms of country and industry. The customers, however, are primarily large companies with high credit ratings, and the agreed payment terms in the contracts typically ensure that any overdue amounts are kept at low level. Thus, credit losses have historically been insignificant.
As at year-end, the Group's portfolio of loans and loan facilities is well diversified both with regards to maturity profile and lenders. In June 2023 the Company entered a 7-year loan facility of MNOK 73 with Sandnes Sparebank. Together with an existing loan facility of MNOK 75 with Sandnes Sparebank, the facilities total MNOK 148. The unused portion of the credit facilities was MNOK 55.3 as at 31.12.2023.
| Next year | 1-2 years | 2-5 years | More than 5 | |
|---|---|---|---|---|
| (amounts in NOK 1000) | years | |||
| Lease liabilities | 12 442 | 13 5 8 1 | 20 614 | 16 5 5 6 |
| Borrowings | 21 3 93 | 18 942 | 47024 | 14 4 53 |
| Trade payables | 13 153 | 0 | 0 | $\Omega$ |
| Total non-derivative | 46 988 | 32 5 23 | 67 639 | 31 009 |
| Currency forward contracts | 3672 | 0 | 0 | $\Omega$ |
| Total derivative | 3 6 7 2 | 0 | 0 | 0 |
| Total | 50 660 | 32 5 23 | 67 639 | 31 009 |
The Group has evaluated the overall climate risk to be low. Climate related matters are not expected to critically effect assets, provisions, or future cash flows. The analysis is based on the Task Force on Climate-related Financial Disclosures (TCFD) framework. The Group has evaluated the physical risk, the risk associated with transition into a low carbon community and the liability risk towards the Group. The opportunities are considered to exceed the risks identified for the Group.
| Risk | Soiltech's Risk | Soiltech Mitigation of Risk | Risk Output |
|---|---|---|---|
| Physical risk | Impact on infrastructure integrity and safety. Increased vulnerability to extreme weather events effecting transportation of goods and services |
$\checkmark$ Several transportation suppliers and focus on proper communications with them ✔ Focus on critical spare parts in-house Proper planning to address possible longer delivery times |
Low. |
| Transition into a low carbon community |
Mainly oil & gas clients are an inherent risk for Soiltech today. |
✓ Technology to be introduced to other sectors such as marine, water purifying, and other types of fluid waste streams |
Medium |
| Liability risk | Operating in the oil and gas sector involves potential changes in legal regulations. The liability risk for Soiltech is evaluated more as an opportunity rather than a risk. As discharge to sea requirements (OIW) tighten worldwide, this gives Soiltech increased opportunities for international growth. |
$\checkmark$ Soiltech's unique technologies reduce the carbon footprint for our clients Continued focus on development of our technologies |
Low |
The share capital of the parent company, Soiltech AS, amounts to NOK 740 543 as of 31 December 2023, and consists of a total of 7,405,430 ordinary shares, each with a nominal value of NOK 0.1.
| Ownership | ||
|---|---|---|
| Shareholders | Number of shares | interest |
| Winthershall DEA Technology Ventures GmbH | 1067820 | 14,4% |
| Hildr AS | 747 430 | 10,1% |
| Wellex AS by Glenn Asland | 747 430 | 10,1% |
| Knatten I AS by Jan Erik Tveteraas | 700 325 | 9,5% |
| Carnegie Investment Bank AB | 560 980 | 7,6% |
| Skagenkaien Investering AS | 541 380 | 7,3% |
| Tveteraas Invest AS | 521 710 | 7,0% |
| DNB Bank ASA | 345 790 | 4,7% |
| Pima AS by Eirik Flatebø | 202 830 | 2,7% |
| Havnebase Eiendom AS | 158 470 | 2,1% |
| Zetlitz Capital AS | 102 030 | 1,4% |
| Tucan Holding AS | 100 560 | 1,4% |
| Campo Eiendom AS | 83 000 | 1,1% |
| Forte Trønder | 79 800 | 1,1% |
| Ryder | 78 000 | 1,1% |
| Top 15 shareholders | 6 037 555 | 82% |
| Other | 1 3 6 7 8 7 5 | 18% |
| Total | 7 405 430 | 100% |
Included in Other shareholders are 5 000 shares owned by board member Olaf Skrivervik. Foreign ownership was 32,4% at year-end 2023 (2022: 32,4%)
| * More information on options in note 24 | |
|---|---|
The consolidated financial statements comprise of all subsidiaries controlled by the parent entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. Likewise, they are deconsolidated from the date that control ceases.
The subsidiary Sorbwater Technology AS was acquired by Soiltech AS on 2 September 2022, and were consolidated from this date forward (ref. further details below). The composition of the Group is otherwise unchanged in the periods presented in these financial statements.
| Ownership | |||
|---|---|---|---|
| Registered office | interest | Voting share | |
| Soiltech Offshore Services AS | Sandnes, Norway | 100% | 100% |
| Sorbwater Technology AS | Bergen, Norway | 100% | 100% |
On 2nd of September 2022 the Group acquired 100% of the shares in Sorbwater Technology AS. Sorbwater has industry leading expertise within bio-degradable chemistry. The deferred tax asset is recognized in full as it is probable that the Group will have sufficient future taxable profits to realize carryforward unused tax losses, through group contributions between the Group companies. A part of the consideration for Sorbwater, amounting to MNOK 15, was contingent on meeting certain sales targets in the future. At the time of acquisition, the Company assessed meeting these sales targets as highly probable. The entire contingent consideration was therefore recognized as a liability and presented as other non-current liabilities in the statement of financial position. With reference to note 9, the expected synergies from the Sorbwater patented, biodegradable chemicals are delayed, and the business plan has therefore been revised. Consequently, the contingent part of the consideration has been recognized as other gain in 2023.
Details of the fair value of identifiable assets and liabilities acquired purchase consideration and goodwill are as follows:
| (amounts in NOK 1000) | |
|---|---|
| Cash paid | Ω |
| Ordinary shares issued | 15 000 |
| Contingent consideration | 15 000 |
| Total | 30 000 |
| ASSets | |
|---|---|
| Deferred tax assets | 25 3 16 |
| Intangible assets | 675 |
| Property, plant & equipment | 3 2 4 2 |
| Inventories | 294 |
| Cash and cash equivalents | 160 |
| Other current assets | 160 |
| Liabilities | |
| Other current liabilities | $-4898$ |
| Net identifiable assets acquired | 24 949 |
| Goodwill | 5 0 5 1 |
| Net assets acquired | 30 000 |
| (amounts in NOK 1000) | ||
|---|---|---|
| Cash paid | ||
| Acquisition related cost | 227 | |
| Cash acquired | 160 | |
| Liability to Soiltech (before acquisition date) | - | 400 |
| Net cash outflow $-$ investing activities | 467 |
| (amounts in NOK 1000) | Salarv | Other benefits | Pension |
|---|---|---|---|
| Salary CEO (Jan Erik Tveteraas) | 2 1 3 1 | 162 | 93 |
| Salary CEO (Stig H. Christiansen) | 1891 | 89 | 48 |
| Salary CFO | 1 3 4 0 | 142 | 93 |
The previous CEO Stig H. Christiansen resigned from his position in April 2023. No severance payment was made. At the same time, Jan Erik Tveteraas was appointed as new CEO. If the Company terminates the CEO employment, the Executive shall be entitled to severance pay for a period of 12 months after the expiry of the agreed notice period.
| Board of directors | Remuneration | Other benefits |
|---|---|---|
| Board (excl. Chairman of the board) | 300 | |
| Total remuneration | 300 |
Gunnar Winther Eliassen was elected as new Chairman of the board in December 2023. The previous executive chairman Jan Erik Tveteraas resigned from the board in December 2023, continuing in his role as CEO. Robert Hvide MacLeod resigned from the board in December 2023. No remuneration has been paid to the general manager and directors in subsidiaries. The Company has not provided loans or collateral to executives or members of the board.
| Name | Title | Granted 2023 | Excersiced 2023 | As at 31.12.23 |
|---|---|---|---|---|
| Jan Erik Tveteraas | CEO | $\overline{\phantom{0}}$ | $\overline{\phantom{a}}$ | 147 440 |
| Stig H. Christiansen | CEO | $\blacksquare$ | $\overline{\phantom{a}}$ | |
| Tove Vestie | CFO | $\overline{\phantom{a}}$ | 100 000 | |
| Glenn Åsland | COO/Board | $\overline{\phantom{0}}$ | $\overline{\phantom{a}}$ | 86 130 |
| Eirik Flatebø | Board | ۰ | 75 000 | |
| Robert Hvide MacLeod* | Board | $\blacksquare$ | $\overline{\phantom{a}}$ | 75 000 |
| Olaf Skrivervik | Board | 10 000 | ||
| Total | $\blacksquare$ | 493 570 |
*Robert Hvide MacLeod resigned from the board in December 2023.
The Group has a long-term share-based incentive plan for key personnel and board members. The term of the plan implies that it is recognised as an equity-settled share-based payment transaction in accordance with IFRS 2. Associated obligations to pay social security tax are recognised as cash-settled share-based payment transactions.
The strike price of the options is set at the market price at grant date. Granted options are distributed over three equal tranches with vesting period of 1-3 years. All outstanding options must be exercised within 5 years from the grant date. Granted options are measured at fair value at the grant date, which is determined using the Black-Scholes option pricing model. Company uses a third-party company for this calculation. 2023 2022 80-82 45-75
| Risk free interest rate | 3,70 | 2,17 |
|---|---|---|
| Historical volatility | 0,10 | 0,10 |
| Expected lifetime of the option (years) | 5,00 | 5,00 |
| Share price | ||
| Average option value (NOK) | 80 | 65 |
| Associated obligations to pay social security tax are recognised as cash-settled share-based payment transactions. | ||||
|---|---|---|---|---|
| Long-term share-based incentive plan The strike price of the options is set at the market price at grant date. Granted options are distributed over three equal tranches with vesting period of 1-3 years. All outstanding options must be exercised within 5 years from the grant date. Granted options are measured at fair value at the grant date, which is determined using the Black Scholes option pricing model. Company uses a third-party company for this calculation. |
||||
| Summary of granted options in the period | ||||
| Risk free interest rate | 3,70 | 2,17 | ||
| Historical volatility | 0,10 | 0,10 | ||
| Expected lifetime of the option (years) | 5,00 | 5,00 | ||
| Share price | ||||
| Average option value (NOK) | 80 | 65 | ||
| Movement in outstanding share options | Average exercise price | Number of options | ||
| 2023 | 2022 | 2023 | 2022 | |
| As at 1 January | 80,00 | 66,00 | 1 249 700 | 829 700 |
| Granted during the year | 170 000 | 425 000 | ||
| Exercised during the year | - | - 5 000 |
||
| Forfeited during the year | - 150 000 |
- | ||
| Expired during the year | - | - | ||
| As at 31 December | 1 269 700 | 1 249 700 | ||
| Vested and exercisable at 31 December | 871 367 | 615 553 |
| Number of options | |||
|---|---|---|---|
| Expiry date | Exercise price | 2023 | 2022 |
| 12,00 | 172 260 | 172 260 | |
| 30.03.2026 | 11,00 | 5 0 0 0 | 5 0 0 0 |
| 35,00 | 85 000 | 85 000 | |
| 35,00 | 35 000 | 35 000 | |
| 35,00 | 35 000 | 35 000 | |
| 35,00 | 257 440 | 257 440 | |
| 35,00 | 60 000 | 60 000 | |
| 35,00 | 15 000 | 15 000 | |
| 45,00 | 160 000 | 160 000 | |
| 01.01.2027 | 45,00 | 100 000 | 100 000 |
| 65,00 | 90 000 | 90 000 | |
| 09.06.2027 | 62,50 | 15 000 | 165 000 |
| 75,00 | 70 000 | 70 000 | |
| 82,00 | 30 000 | ||
| 80,00 | 15 000 | ||
| 80,00 | 45 000 | ||
| 80,00 | 65 000 | ||
| 80,00 | 15 000 | ||
| 1 269 700 | 1 249 700 | ||
| 30.03.2026 30.03.2026 30.03.2026 30.03.2026 30.03.2026 30.03.2026 01.09.2026 23.09.2026 02.09.2027 17.04.2028 01.06.2028 01.09.2028 01.12.2028 |
17.03.2027 01.10.2028 |
There are no events other than business activities in the ordinary course of business after the balance sheet date of an adjusting or non-adjusting nature.
In connection with the transition to IFRS, the management has carried out a thorough review of the Group's business and its accounting policies currently applied under NGAAP. Although the transition requires changes in the treatment of operating leases and goodwill, the overall conclusion has been that the transition has a limited impact on the financial reporting of the Group. Further details of the most significant changes per transition date and year-end 2022 are explained in notes to the reconciliations below.
| (amounts in NOK 1000) | Note | NGAAP | Adjust-ments | Reclassi-fications | IFRS |
|---|---|---|---|---|---|
| Assets Non-current assets |
|||||
| Deferred tax assets | C | $\blacksquare$ | $142 -$ | 142 | $\sim$ |
| Intangible assets | 461 | 461 | |||
| Property, plant & equipment | 88 968 | 88 968 | |||
| Right-of-use assets | B | 33 508 | 6 1 4 1 | $\overline{a}$ | 39 649 |
| Other non-current assets | 294 | $\overline{\phantom{a}}$ | 294 | ||
| Total non-current assets | 123 231 | $6282 -$ | 142 | 129 372 | |
| Current assets | |||||
| Inventories | $\overline{\phantom{a}}$ | $\blacksquare$ | |||
| Trade receivables | А | 28 945 | 5376 | 34 321 | |
| Cash and cash equivalents | 39 2 32 | $\overline{a}$ | 39 232 | ||
| Other current assets | А | 21 4 35 | 5376 | 16 0 59 | |
| Total current assets | 89 613 | 89 612 | |||
| Total assets | 212 844 | $6282 -$ | 142 | 218 984 | |
| Equity and liabilities | |||||
| Equity | |||||
| Share capital | 720 | 720 | |||
| Other paid-in equity | 70 045 | 70 045 | |||
| Other reserves | $\blacksquare$ | 41 983 | |||
| Retained earnings | C | 42 485 - | 502 502 |
112 748 | |
| Total equity | 113 249 - | ||||
| Liabilities | |||||
| Non-current liabilities | |||||
| Borrowings | B | 40 10 6 | $\mathbb{R}$ $\Box$ |
8962 | 31 144 |
| Lease liabilities | B | $\overline{\phantom{a}}$ | 5499 | 14 309 | 19808 |
| Deferred tax liabilities | 6 0 4 0 | 142 | 5898 | ||
| Provisions | 911 | ä, | 911 | ||
| Other non-current liabilities | 55 | $\overline{a}$ | 55 | ||
| Total non-current liabilities | 47 112 | 5499 | 5 2 0 6 | 57817 | |
| Current liabilities | |||||
| Trade payables | А | 13 3 21 | $\hat{\mathbf{r}}$ | 459 | 13780 |
| Borrowings | B | 16 4 18 | $\frac{1}{2}$ | 10 048 $\sim$ |
6370 |
| Lease liabilities | В | $\blacksquare$ | 1 2 8 6 | 4955 | 6 2 4 1 |
| Tax payable | 931 | ÷ | $\overline{\phantom{0}}$ | 931 | |
| Other current liabilities | А | 21813 | $\omega_{\rm{eff}}=1$ | 714 | 21 099 |
| Total current liabilities | 52 4 83 | $1286 -$ | 5 3 4 7 | 48 4 21 | |
| Total liabilities | 99 595 | 6784 - | 142 | 106 238 | |
| Total equity and liabilities | 212 844 | 6 2 82 - | 142 | 218 986 | |
| (amounts in NOK 1000) | Effect of transition on statement of financial position per 31 December 2022 Note |
NGAAP | Adjust-ments | Reclassi-fications | IFRS |
|---|---|---|---|---|---|
| Assets | |||||
| Non-current assets | |||||
| Deferred tax assets | C | 15 133 | 139 | - | 15 272 |
| Intangible assets | C | 6 835 | - 40 |
- | 6 795 |
| Property, plant & equipment | 130 300 | - | - | 130 300 | |
| Right-of-use assets | B | 47 126 | 5 668 | - 12 442 |
40 352 |
| Other non-current assets | 738 | - | - | 738 | |
| Total non-current assets | 200 132 | 5 767 | - 12 442 |
193 457 | |
| Current assets | |||||
| Inventories | 238 | - | - | 238 | |
| Trade receivables | A | 22 288 | - | 6 956 | 29 244 |
| Cash and cash equivalents | 38 832 | - | - | 38 832 | |
| Other current assets Total current assets |
A | 15 003 76 360 |
- - |
- 6 956 - |
8 047 76 361 |
| Total assets | 276 492 | 5 767 | - 12 442 |
269 818 | |
| Equity and liabilities | |||||
| Equity | |||||
| Share capital | 741 | - | - | 741 | |
| Other paid-in equity | 83 948 | - | - | 83 948 | |
| Other reserves | 1 132 | - | - | 1 132 | |
| Retained earnings Total equity |
C | 57 132 142 953 |
- 493 - 493 |
- - |
56 639 142 460 |
| Liabilities | |||||
| Non-current liabilities | |||||
| Borrowings Lease liabilities |
B | 61 795 - |
- 4 652 |
- 22 903 12 090 |
38 892 16 742 |
| Deferred tax liabilities | - | - | - | - | |
| Provisions | 796 | - | - 796 |
- | |
| Other non-current liabilities | 18 081 | - | - 2 285 |
15 796 | |
| Total non-current liabilities | 80 672 | 4 652 | - 13 894 |
71 430 | |
| Current liabilities | |||||
| Trade payables | A | 9 178 | - | 724 | 9 902 |
| Borrowings | 21 254 | - | - 7 928 |
13 326 | |
| Lease liabilities | B | - | 1 609 | 6 327 | 7 935 |
| Tax payable | - | - | - | - | |
| Other current liabilities | A | 22 437 | - | 2 329 | 24 766 |
| Total current liabilities | 52 869 | 1 609 | 1 452 | 55 929 | |
| Total liabilities | 133 539 | 6 260 | - 12 442 |
127 359 | |
| Total equity and liabilities | 276 492 | 5 767 | - 12 442 |
269 819 |
| Effect of transition on statement of comprehensive income for 2022 | |||||
|---|---|---|---|---|---|
| (amounts in NOK 1000) | Note | NGAAP | Adjust-ments | Reclassi-fications | IFRS |
| Revenue Other operating income |
177 073 1 097 |
- - |
- - |
177 073 1 097 |
|
| Total operating income | 178 170 | - | - | 178 170 | |
| Cost of materials | 35 220 | - | - | 35 220 | |
| Personnel expenses | 88 383 | - | - | 88 383 | |
| Depreciation and amortisation | A, B | 14 799 | 1 232 | - | 16 032 |
| Other operating expenses | A, B | 17 372 - |
1 515 | - | 15 857 |
| Total operating expenses | 155 775 - |
283 | - | 155 492 | |
| Operating profit (loss) | 22 396 | 283 | - | 22 678 | |
| Net foreign exchange gains (losses) | - | - | - | - | |
| Financial income | 1 214 | - | - | 1 214 | |
| Financial expenses | A - |
4 819 - |
272 | - | - 5 091 |
| Net financial items | - | 3 605 | - 272 |
- | - 3 877 |
| Profit (loss) before tax | 18 791 | 11 | - | 18 802 | |
| Income tax expense | 4 143 | 2 | - | 4 145 | |
| Profit (loss) for the period | 14 648 | 9 | - | 14 656 | |
| Other comprehensive income | |||||
| Items that may be reclassified to profit or loss | |||||
| Currency translation differences | - | - | - | - | |
| Income tax relating to these items | - | - | - | - | |
| - | - | - | - | ||
| Net other comprehensive income |
| Items that may be reclassified to profit or loss | ||
|---|---|---|
In order to achieve a more correct classification in the balance sheet, the Group has decided to reclassify receivables relating to earned, not invoiced revenue from other current assets to trade receivables. Correspondingly, the provision for trade payables for which no invoice has been received has also been reclassified from other current liabilities to trade payables.
For operating leases, the lease payments have been expensed continuously under NGAAP. As IFRS does not distinguish between operating and financial leases, all leases are recognized in the balance sheet as right-of-use assets and lease liabilities. The transition adjustments relate exclusively to the rental of office premises. For these leases, the Group has decided to recognize the right-of-use assets with a carrying amount as if IFRS 16 had been applied since commencement date. A discount rate of 4,6% has been applied when calculating the liability for the office leases.
| (amounts in NOK 1000) | 31/12/2022 | 01/01/2022 | 2022 |
|---|---|---|---|
| Right-of-use asset | 5 6 6 8 | 6 1 4 1 | |
| Lease liability | 6 2 6 0 $\blacksquare$ |
6 7 8 4 | |
| Deferred tax asset | 139 | 142 | |
| Retained earnings | 493 | 502 | |
| Depreciation | 1420 | ||
| Other operating expenses | 1742 | ||
| Financial expenses | 272 | ||
| Income tax expense | 11 | ||
| Profit (loss) for the period | 40 |
In previous reporting under NGAAP, the Group's liabilities relating to financial leases have been presented together with ordinary bank loans in the balance sheet. Starting from the transition to IFRS, these are presented separately as lease liabilities in the balance sheet.
As of end 2022, the Group had entered into several lease agreements for the lease of STT units under construction, but not yet handed over to the Group. Previous balance sheets prepared under NGAAP, included assets and liabilities corresponding to the accrued payments from the bank to the manufacturer of the equipment. An adjustment of MNOK 12,4 is therefore made to both right-of-use assets and lease liabilities since IFRS does not permit recognition of these items until the date of commencement of the lease.
In September 2022, the Company acquired Sorbwater Technology AS. Prior to this; the Company has not been involved in any business combinations that could be eligible for a retrospective application of IFRS 3. When accounting for the acquisition of Sorbwater Technology AS under NGAAP, all assessments and assumptions were made in light of a possible future transition to IFRS. As a result, the differences were limited to those areas where NGAAP prohibits the use of IFRS solutions. These areas comprise amortization of goodwill under NGAAP, as well as the treatment of transaction costs. While transaction costs are always recognized as expenses under IFRS, they are treated as part of the consideration under NGAAP, which in practice leads to increased goodwill.
| (amounts in NOK 1000) | 31/12/2022 | 2022 |
|---|---|---|
| Intantigble assets | 40 | |
| Depteciation and amortization | 187 | |
| Other operating expenses | 227 |
| (amounts in NOK 1000) | Note | 2023 | 2022 |
|---|---|---|---|
| Revenue | 3 | 229 108 | 176877 |
| Other operating income | 3 | 167 | 1217 |
| 0 | |||
| Total operating income | 3 | 229 275 | 178 094 |
| Cost of materials | -124 042 | $-96750$ | |
| Personnel expenses | 4 | $-38124$ | $-31320$ |
| Depreciation and amortisation | 5 | $-15641$ | $-14441$ |
| Impairment | 0 | 0 | |
| Other operating expenses | 6 | -18 486 | $-12$ 195 |
| Total operating expenses | -196 294 | -154 706 | |
| Other gains | $\overline{7}$ | 15 000 | 0 |
| Operating profit | 47 981 | 23 3 88 | |
| Net foreign exchange gains (losses) | 179 | -136 | |
| Financial income | 288 | 538 | |
| Financial expenses | 8 | $-16624$ | $-3921$ |
| Net financial items | $-16$ 157 | $-3519$ | |
| Profit before tax | 31 824 | 19870 | |
| Income tax expense | 9 | $-5736$ | -4 3 3 9 |
| Profit for the period | 26 088 | 15 530 | |
| Total profit for the period is attributable to: | |||
| Owners of Soiltech AS | 26 088 | 15 530 | |
| TRANSFERS | |||
| Transfers to other equity | 26 088 | 15 530 | |
| Total allocations | 26 088 | 15 530 |
| BALANCE SHEET | |||
|---|---|---|---|
| (amounts in NOK 1000) | |||
| ASSETS | Note | 2023 | 2022 |
| Non-current assets | |||
| Intangible assets | 10 | 1 136 | 1 070 |
| Property, plant & equipment | 11 | 180 954 | 127 230 |
| Right-of-use assets | 12 | 53 027 | 34 684 |
| Investments in subsidiaries | 7 | 37 434 | 37 682 |
| Other non-current assets | 13 | 762 | 738 |
| Total non-current assets | 273 312 | 201 403 | |
| Receivables | |||
| Trade receivables | 14 | 44 171 | 29 338 |
| Cash and cash equivalents | 15 13 |
23 586 | 36 098 |
| Other current assets | 16 829 | 7 933 | |
| Total current assets | 84 585 | 73 368 | |
| TOTAL ASSETS | 357 897 | 274 772 | |
| EQUITY AND LIABILITIES Equity |
Note | 2023 | 2022 |
| Share capital | 17 | 741 | 741 |
| Other paid-in equity | 83 948 | 83 948 | |
| Other reserves | 1 826 | 1 132 | |
| Retained earnings | 83 825 | 57 738 | |
| Total equity | 170 340 | 143 558 | |
| LIABILITIES | |||
| Borrowings | 16 | 68 913 | 38 892 |
| Lease liabilities | 12 | 24 800 | 12 090 |
| Deferred tax liabilities | 9 | 11 699 | 8 499 |
| Other non-current liabilities | 13 | 669 | 15 796 |
| Total non-current liabilities | 106 081 | 75 277 | |
| Current liabilities | |||
| Trade payables | 29 866 | 21 146 | |
| Borrowings Lease liabilities |
16 12 |
16 860 8 800 |
13 325 7 211 |
| Tax payable | 9 | 0 | 0 |
| Other current liabilities | 13 | 25 950 | 14 254 |
| Total current liabilities | 81 477 | 55 936 | |
| Total liabilities | 187 558 | 131 214 | |
| Total equity and liabilities | 357 897 | 274 772 | |
Sandnes, March 15, 2024
The board of directors of Soiltech AS
____________________ ____________________ ____________________
Gunnar Winther Eliassen Chairman of the Board
____________________ ____________________ ____________________
Carsten Brückner
Olaf Skrivervik
Member of the Board Glenn Åsland Member of the Board
Member of the Board Eirik Flatebø Member of the Board
Jan Erik Tveteraas Chief Executive Officer
| 2023 | 2022 | |
|---|---|---|
| Cash flows from operating activities | ||
| Operating profit before tax | 31824 | 19870 |
| Income taxes paid | 0 | $-893$ |
| Depreciation and amortisation | 15 641 | 14 44 1 |
| Interest expense | 7 3 6 0 | 3929 |
| Other gains | $-15000$ | 0 |
| Impairment of shares in subsidiaries | 9 2 4 0 | $-982$ |
| Changes in trade receivables, contract | ||
| assets/liabilities | $-14669$ | 6564 |
| Changes in trade payables | 9593 | $-3774$ |
| Changes in other accruals and prepayments | $-7049$ | 6636 |
| Net cash flow from operating activities | 36938 | 45 791 |
| Cash flows from investment activities | ||
| Purchase of property, plant & equipment & Intangible as | $-63988$ | -49 900 |
| Sale of property, plant and equipment | 0 | 1 250 |
| Investment in subsidiary net of cash acquired | 0 | $-627$ |
| Net cash flow from investment activities | $-67$ 144 | -50 993 |
| Cash flows from financing activities | ||
| Proceeds from new borrowings | 45 561 | 25 301 |
| Repayments on borrowings | $-13226$ | $-10371$ |
| Payment of principal portion of lease liabilities | $-8664$ | $-6047$ |
| Interest paid | $-6139$ | -4 156 |
| Proceeds from capital increase | 0 | 55 |
| Net cash flow from financing activities | 17 531 | 4782 |
| NET CASH FLOW FOR THE PERIOD | $-12512$ | -439 |
| Cash and cash equivalent 01 01 | 36 098 | 36 537 |
| Cash and Cash eqiuvalents 31.12 | 23 586 | 36 098 |
| (amounts in NOK 1000) | Note | Share capital |
Other paid-in |
Other reserves |
Retained earnings |
Total equity |
|---|---|---|---|---|---|---|
| Balance at 31 December 2022 | 741 | 83 948 | 1 1 3 2 | 57 738 | 143 558 | |
| Balance at 31 December 2022 | 741 | 83 948 | 1 1 3 2 | 57 738 | 143 558 | |
| Profit for the period | 0 | 0 | 26 088 | 26 088 | ||
| Total income | 0 | 0 | 26 088 | 26 088 | ||
| Transactions with owners | ||||||
| Share-based payment | 0 | 0 | 694 | 0 | 694 | |
| Contributions of equity | 0 | 0 | ||||
| Balance at 31 December 2023 | 741 | 83 948 | 1826 | 83825 | 170 340 |
Soiltech AS (the 'Company') is a limited company domiciled in Norway. The registered office of the Company is Koppholen 25, 4313, Sandnes, Norway. The Company is an innovative technology company specializing in the treatment, recycling and responsible handling of contaminated water and solid industrial waste streams at site. The Company is listed on the NOTC in Oslo with ticker code 'SOIL'. The financial statements for the year ended 31 December 2023 were approved and authorized for issue in accordance with a resolution of the board of directors on 19th of March 2024.
The general accounting policies applied in the preparation of the financial statements are set out below. Specific accounting policies related to the individual areas in the financial statements are described in the relevant notes.
The financial statement has been prepared in accordance with Norwegian Accounting Act and associated regulations, as well as Generally Accepted Accounting Principles (GAAP) in Norway. The financial statement is presented in Norwegian Kroner (NOK) and have been rounded to the nearest thousand unless otherwise stated. As a result of rounding adjustments, amounts and percentages may not add up to the total. The financial statements are prepared on a going concern basis.
Transactions in foreign currencies are translated at the rate applicable on the transaction date. Monetary items in a foreign currency are translated into NOK using the closing rate at the balance sheet date.
The cash flow analysis has been prepared according to the indirect method.
The Group's revenue mainly derive from the sale of services related to treatment of contaminated water (i.e. slop), cuttings handling, cleaning services and other related services, for customers within the oil & gas industry. The key element of the service deliveries is the deployment and supervision of treatment and handling equipment at the customer's site. The contract consideration is composed mainly of agreed daily rates for equipment and personnel, respectively, and reimbursement of costs plus a markup. Rates vary depending on whether the equipment is in active use during ongoing operations or in standby, for example when the equipment is on location but not in operation. Costs of mobilization and demobilization of equipment and personnel are normally recovered through the agreed daily rates, except for some contracts, where they are reimbursed separately. Such reimbursement are, however, generally not material in relation to the total contract consideration. Consideration is normally invoiced monthly, based on actual deliveries.
The contracts are considered to consist of only one performance obligation, which is satisfied over time. Progress is measured on the basis of the time the STT unit is available to service the customer. In practice, revenue based on daily rates are thus recognized with the amount that the Company has a right to invoice. As a practical simplification based on materiality, any fees associated with mobilization and demobilization are recognized linearly over the period of the contract they relate to. Cost of mobilization is considered to be cost to fulfil a contract and are recognized as an asset when incurred. The asset is subsequently amortized over the contract period, as cost of materials and personnel expenses.
| Revenues by product category | |
|---|---|
| Revenues by geography | |
| Revenues from major customers | |
| Costs to fulfil the customer contracts | |
Personnel costs are expensed as the employees earn the right to the payment of wages for hours worked. Payments to defined contribution pension are expensed over the period in which the employees earn the right to the deposit.
follow the stipulations in the Norwegian Mandatory Occupational Pensions Act. The Group's pension scheme adheres to the requirements, as set in the Act.
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Wages and salaries | 23 3 3 6 | 22758 |
| Contract personnel | 2 6 6 7 | 1798 |
| Pension contributions | 1 2 0 0 | 862 |
| Social security tax | 5 4 0 7 | 3810 |
| Other personnel expenses* | 5 5 1 4 | 2 0 9 2 |
| Total | 38 1 24 | 31 3 20 |
*Other personnel expenses include expenses related to share-based payment transactions. Please refer to notes for Consolidation financial statement for further details.
| 31/12/2023 | 31/12/2022 | |
|---|---|---|
| Norway | 20 | 13 |
| United Kingdom | 13 | |
| Other | 6 | |
| Total | 39 | 26 |
| (amounts in NOK 1000) | Salary | Other benefits | Pension |
|---|---|---|---|
| Salary CEO (Jan Erik Tveteraas) | 2 1 3 1 | 162 | 93 |
| Salary CEO (Stig H. Christiansen) | 1 891 | 89 | 48 |
| Salary CFO | 1 340 | 142 | 93 |
The previous CEO Stig H. Christiansen resigned from his position April 2023. No severance payment was made. The new CEO Jan Erik Tveteraas started in April 2023.
| Board of directors | Remuneration | Other benefits |
|---|---|---|
| Board (excl. Chairman of the board) | 300 | |
| Total remuneration | 300 |
Gunnar Winther Eliassen was elected as new Chairman of the board in December 2023. The previous Chairman of the board Jan Erik Tveteraas continues as CEO. Director Robert Hvide MacLeod resigned from board in December 2023.
| (amounts in NOK 1000) | Note | 2023 | 2022 |
|---|---|---|---|
| Amortisation of intangible assets | 10 | 146 | 12 |
| Depreciation property, plant & equipment | 11 | 11 580 | 10 750 |
| Depreciation of right-of-use assets | 12 | 3 9 1 6 | 3679 |
| Total | 15 641 | 14 441 |
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Cost of lease of assets of low value | 163 | 163 |
| Audit and Accounting cost | 2 7 6 4 | 1644 |
| Legal advisor cost | 3 5 7 6 | 720 |
| Office cost and it equipment | 4 1 5 3 | 5 2 0 7 |
| Travel related cost | 803 | 803 |
| Sales and commercial cost | 940 | 940 |
| Insurance | 750 | 622 |
| Other cost | 5 3 3 7 | 2096 |
| Total | 18486 | 12 195 |
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Statutory audit fee | 474 | 140 |
| Other certification services | 0 | |
| Tax advisory services | 0 | |
| Other non-auditing services | 273 | 213 |
| Total | 747 | 353 |
In the Parent company, the subsidiaries and investments in any associated company are valued at cost. The investment is valued at the cost of the shares, less any impairment losses. An impairment loss is recognized if the impairment is not considered temporary, in accordance with generally accepted accounting principles. Impairment losses are reversed if the reason for the impairment loss is rectified in a later period.
Dividends, Group contributions and other distributions from subsidiaries are recognized in the same year as they are recognized in the financial statement of the provider. If dividends / group contribution exceeds withheld profits after the acquisition date, the excess amount represents repayment of invested capital, and the distribution will be deducted from the recorded value of the acquisition in the balance sheet for the parent company.
| Company name (amounts in NOK 1000) |
Place of office | Ownership | Equity as of 31.12.2023 |
Net result for 2023 |
Carrying value 31.12.2023 |
|---|---|---|---|---|---|
| Soiltech Offshore Services AS | Sandnes | 100% | 1 065 | 140 | 788 |
| Sorbwater Technology AS | Bergen | 100% | 37017 | $-3036$ | 36 646 |
The expected synergies from the Sorbwater patented biodegradable chemicals are delayed and the business plan has therefore been revised. The delay in synergies has resulted in certain thresholds under the SPA are uncertain to be met. Consequently, the contingent consideration of MNOK 15 that was recognized as part of the consideration has been reversed and recognized as other gain in 2023. As a consequence of this, a write down of the investment in Sorbwater Technology AS of MNOK 9.2 has been made. This write down is reflected under financial expenses.
| (amounts in NOK 1000) | Relationship | Transaction type | 2023 | 2022 |
|---|---|---|---|---|
| Purchase of services from Soiltech Offshore AS | Subsidiary | Purchase of serv. | 85 591 | 66 885 |
| Funding of Sorbwater Technology AS | Subsidiary | Funding | 3 5 5 5 | 1 7 1 5 |
| Total | 89 146 | 68 600 |
| Note 8 Financial items |
|||
|---|---|---|---|
The tax expense consists of the tax payable and changes to deferred tax. Deferred tax/tax assets are calculated on all differences between the book value and tax value of assets and liabilities, with the exception of: temporary differences linked to goodwill that are not tax deductible. Temporary differences, both positive and negative, which will or are likely to reverse in the same period, are recorded as a net amount.
Deferred tax assets are recognised when it is probable that the company will have a sufficient profit for tax purposes in subsequent periods to utilize the tax asset. The companies recognize previously unrecognized deferred tax assets to the extent it has become probable that the company can utilize the deferred tax asset. Similarly, the company will reduce a deferred tax asset to the extent that the company no longer regards it as probable that it can utilize the deferred tax asset. Deferred tax and deferred tax assets are measured on the basis of the expected future tax rates applicable to the companies in the Group where temporary differences have arisen based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. Deferred tax and deferred tax assets are recognized at their nominal value and classified as noncurrent asset investments (non-current liabilities) in the balance sheet.
A group contribution is given to subsidiary company Sorbwater Technology AS that will utilize this against its loss carry forward.
Intangible assets mainly comprise goodwill originating from previous acquisitions. Goodwill is not depreciated but is instead subject to annual impairment testing. Other intangible assets include patents and software which are recognised in accordance with the cost method and depreciated over their expected economic lifetime.
| (amounts in NOK 1000) | Other |
|---|---|
| Cost 01.01.2022 | 2061 |
| Additions | 621 |
| Addition business combination | 0 |
| Cost 31.12.2022 | 2682 |
| Additions | 213 |
| Disposals | $\Omega$ |
| Cost 31.12.2023 | 2895 |
| Accumulated depreciation 01.01.2022 | 1500 |
| Depreciations for the year | 12 |
| Accumulated depreciation 31.12.2022 | 1512 |
| Accumulated impairment 01.01.2022 | 100 |
| Impairment for the year | $\Omega$ |
| Accumulated impairment 31.12.2022 | 100 |
| Depreciations for the year | 146 |
| Accumulated depreciation 31.12.2023 | 1658 |
| Impairment for the year | 0 |
| Accumulated impairment 31.12.2023 | 100 |
| Carrying amount 01.01.2022 | 561 |
| Carrying amount 31.12.2022 | 1070 |
| Carrying amount 31.12.2023 | 1 1 3 6 |
Property, plant & equipment consists of slop treatment units, equipment for cuttings handling and swarf removal, skips and various other equipment. Property, plant & equipment are recognized in accordance with the cost method and depreciated over their expected economic lifetime.
| Property, plant & | |
|---|---|
| (amounts in NOK 1000) | equipment |
| Cost 01.01.2022 | 122 149 |
| Additions | 49 279 |
| Addition business combination | 0 |
| Disposals | $-268$ |
| Cost 31.12.2022 | 171 160 |
| Additions | 63776 |
| Other non cash adjustments | 1527 |
| Disposals | |
| Cost 31.12.2023 | 236 463 |
| Accumulated depreciation 01.01.2022 | 29 612 |
| Depreciations for the year | 10750 |
| Accumulated depreciation 31.12.2022 | 40 362 |
| Accumulated impairment 01.01.2022 | 3 5 6 8 |
| Impairment for the year | 0 |
| Accumulated impairment 31.12.2022 | 3 5 6 8 |
| Accumulated depreciation 31.12.2022 | 40 362 |
| Depreciations for the year | 11580 |
| Accumulated depreciation 31.12.2023 | 51942 |
| Accumulated impairment 31.12.2022 | 3568 |
| Impairment for the year | 0 |
| Accumulated impairment 31.12.2023 | 3568 |
| Carrying amount 01.01.2022 | 92 537 |
| Carrying amount 31.12.2022 | 127 230 |
| Carrying amount 31.12.2023 | 180 954 |
| Economic useful life | 5-15 years |
| Depreciation schedule | Linear |
The Company leases certain operating equipment which in turn is leased to our customers. The Company has substantially all the risks and rewards of ownership and the leases are classified as financial leases. Financial leases are capitalized at the inception of the lease at the lower of the fair value of the leased asset or the present value of the future minimum lease payments. Each lease payment is allocated between the corresponding financial lease liability and finance charges to achieve a constant rate on the liability outstanding.
the Statement of Profit and Loss. The depreciation policy for assets held under financial leases is consistent with that for owned assets and is depreciated over estimated economic life.
The parent company primarily leases slop treatment units (STT). For slop treatment units (STT), the lease term is usually between 4 and 7 years.
| Slop Treatment | |
|---|---|
| (amounts in NOK 1000) | Units |
| Carrying amount 01.01.2022 | 33 508 |
| Additions | 4 8 5 4 |
| Index regulation | 0 |
| New lease business combination | $\mathbf 0$ |
| Depreciations | $-3679$ |
| Carrying amount 31.12.2022 | 34 684 |
| Additions | 22 259 |
| Index regulation | 0 |
| Depreciations | $-3916$ |
| Carrying amount 31.12.2023 | 53 027 |
| Economic useful life | 5-15 years |
| Depreciation schedule | Linear |
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Carrying amount 01.01. | 19 302 | 19 264 |
| Additions | 22 258 | 5 2 0 0 |
| New lease business combination | O | 0 |
| Index regulation | 0 | 0 |
| Interest expenses | 2 5 4 3 | 1532 |
| Lease payments | $-11207$ | $-7579$ |
| Prepayments leasing | 704 | 885 |
| Effect of currency translation | 0 | |
| Carrying amount 31.12. | 33 600 | 19 302 |
| Non-current lease liabilities | 24 800 | 12 091 |
| Current lease liabilities | 8800 | 7 2 1 1 |
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Due within one year | 9 5 5 5 | 10480 |
| Due within one and five years | 23 8 20 | 23 033 |
| Due after 5 years | 7 500 | 3838 |
| Total | 40 875 | 37 351 |
Non-current assets are assets intended for long-term ownership or use. All other assets are current assets. Receivables that fall due for payment within one year shall not be classified as non-current assets. Similar criteria apply to liabilities.
Other current assets are recorded in the balance sheet at nominal value less provisions for expected credit losses.
| Other non-current assets | ||
|---|---|---|
| Other current assets | ||
| Other non-current liabilities | ||
Trade receivables are recognized at an amount equal to the transaction price, less provisions for expected credit losses. The Group applies the simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables.
| Note 15 Cash and cash equivalents |
|
|---|---|
Cash and cash equivalents comprise mostly ordinary bank deposits. The statement of cash flows is prepared using the indirect method. Interest income and expenses are presented as investing and financing activities, respectively.
| (amounts in NOK 1000) | 31.12.23 | 31.12.22 |
|---|---|---|
| Payroll withholding tax account | 962 | 854 |
Borrowings are initially recognized at fair value, including transaction costs directly attributable to the transaction, and are subsequently measured at amortized cost.
The loan facility with Sandnes Sparebank entered in 2023 has the following covenants:
| Nominal interest Nominal amount | Capitalized | Carrying amount | ||
|---|---|---|---|---|
| (amounts in NOK 1000) | rate | financing fees | ||
| Innovasion Norge | 7.7% | 3875 | 3875 | |
| Sandnes Sparebank | 3 m. Nibor + 2.5% | 81898 | 0 | 81898 |
| Carrying amount as per 31.12.2023 | 85 773 | 85 773 | ||
| Non-current borrowings | 68 913 | |||
| Current borrowings | 16860 |
| Nominal interest Nominal amount | Capitalized | Carrying amount | ||
|---|---|---|---|---|
| (amounts in NOK 1000) | rate | financing fees | ||
| Innovasion Norge | 6.0% | 6 4 5 8 | 6458 | |
| Sandnes Sparebank | 3 m. Nibor + 2.5% | 45 758 | 0 | 45 758 |
| Carrying amount as per 31.12.2022 | 52 217 | 0 | 52 217 | |
| Non-current borrowings | 38 892 | |||
| Current borrowings | 13 3 25 |
| Next year | 1-2 years | 2-5 years | More than 5 | |
|---|---|---|---|---|
| (amounts in NOK 1000) | vears | |||
| Innovasion Norge | 2813 | 1 3 3 0 | Ω | 0 |
| Sandnes Sparebank | 18 5 80 | 17 612 | 47 024 | 18 0 38 |
| Total | 21 3 93 | 18 942 | 47024 | 18 038 |
| Next year | 1-2 years | 2-5 years | More than 5 | |
|---|---|---|---|---|
| (amounts in NOK 1000) | vears | |||
| Innovasjon Norge | 2 9 0 8 | 4076 | 0 | |
| Sandnes Sparebank | 13 5 5 5 | 12 776 | 26 090 | $\Omega$ |
| Total | 16 4 63 | 16852 | 26 090 | 0 |
| (amounts in NOK 1000) | 2023 | 2022 |
|---|---|---|
| Property, plant & equipment | 181 937 | 127 230 |
| Trade receivables | 44 171 | 29 3 38 |
| Total | 226 108 | 156 568 |
| For loans with floating interest rates, the amounts above are calculated using the current interest rate per the relevant year end. |
||
|---|---|---|
| Carrying amount of assets pledged as security | ||
| Note 17 Share capital and shareholder information |
||
| Share capital and ownership structure The share capital of the parent company, Soiltech AS, amounts to NOK 740 543 as of 31 December 2023, and consists of a total of 7,405,430 ordinary shares, each with a nominal value of NOK 0.1. |
||
| Shareholders as of 31.12.2023 | Ownership | |
| Shareholders | Number of shares | interest |
| Winthershall DEA Technology Ventures GmbH | 1 067 820 | 14,4% |
| Hildr AS | 747 430 | 10,1% |
| Wellex AS by Glenn Åsland | 747 430 | 10,1% |
| Knatten I AS by Jan Erik Tveteraas | 700 325 | 9,5% |
| Carnegie Investment Bank AB | 560 980 | 7,6% |
| Skagenkaien Investering AS | 541 380 | 7,3% |
| Tveteraas Invest AS | 521 710 | 7,0% |
| DNB Bank ASA | 345 790 | 4,7% |
| Pima AS by Eirik Flatebø | 202 830 | 2,7% |
| Havnebase Eiendom AS | 158 470 | 2,1% |
| Zetlitz Capital AS | 102 030 | 1,4% |
| Tucan Holding AS | 100 560 | 1,4% |
| 1,1% | ||
| Campo Eiendom AS | 83 000 | |
| Forte Trønder | 79 800 | 1,1% |
| Ryder | 78 000 | 1,1% |
| Top 15 shareholders | 6 037 555 | 82% |
| Other | 1 367 875 | 18% |
See information in consolidated financial statement.
See information in consolidated financial statement.
See information in consolidated financial statement.
See information in consolidated financial statement.
There are no events other than business activity in the ordinary course of business after the balance sheet date of an adjusting or non-adjusting nature.
| Created: | 2024 03 15 |
|---|---|
| By: | Tove Vestlie (tove [email protected]) |
| Status: | Signed |
| Transaction ID : | CBJCHBCAABAA9GyJ2JcUnjJRfuDO-OVmA8HWfNqA6Y0M |
| $\mathscr{D}_{\mathbf{G}}$ Document e-signed by Jan Erik Tveteraas ([email protected]) Signature Date: 2024-03-15 - 10:28:30 AM GMT - Time Source: server |
|
|---|---|
| Email viewed by Gunnar Winther Eliassen ([email protected]) 2024-03-15 - 10:28:59 AM GMT |
|
| $\mathscr{O}_\mathbf{G}$ | Document e-signed by Gunnar Winther Eliassen ([email protected]) Signature Date: 2024-03-15 - 10:29:19 AM GMT - Time Source: server |
| Email viewed by Carsten Brueckner (carsten [email protected]) 2024-03-15 - 10:30:02 AM GMT |
|
| $\mathscr{O}_{\mathbf{G}}$ Document e-signed by Carsten Brueckner (carsten [email protected]) Signature Date: 2024-03-15 - 10:30:38 AM GMT - Time Source: server |
|
| Email viewed by Olaf Skrivervik ([email protected]) 2024-03-15 - 10:34:53 AM GMT |
|
| Email viewed by Eirik Flatebø ([email protected]) 2024-03-16 - 9:34:01 AM GMT |
|
| $\mathscr{O}_\bullet$ Document e-signed by Eirik Flatebø (eirik [email protected]) Signature Date: 2024-03-16 - 9:35:47 AM GMT - Time Source: server |
|
| $\mathscr{D}_{\mathbf{G}}$ | Document e-signed by Olaf Skrivervik ([email protected]) Signature Date: 2024-03-16 - 12:10:32 PM GMT - Time Source: server |
| Agreement completed. 2024-03-16 - 12:10:32 PM GMT |
To the General Meeting of Soiltech AS
We have audited the financial statements of Soiltech AS, which comprise:
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 as required by 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.
The Board of Directors and the Managing Director (management) are responsible for the information in the Board of Directors' report and the other information accompanying the financial statements. The other information comprises information in the annual report, but does not include the financial statements and our auditor's report thereon. Our opinion on the financial statements does not cover the information in the Board of Directors' report nor the other information accompanying the financial statements.
In connection with our audit of the financial statements, our responsibility is to read the Board of Directors' report and the other information accompanying the financial statements. The purpose is to consider if there is material inconsistency between the Board of Directors' report and the other information accompanying the financial statements and the financial statements or our knowledge obtained in the audit, or whether the Board of Directors' report and the other information accompanying the financial statements otherwise appear to be materially misstated. We are required to report if there is a material misstatement in the Board
of Directors' report or the other information accompanying the financial statements. We have nothing to report in this regard.
Based on our knowledge obtained in the audit, it is our opinion that the Board of Directors' report
Management is responsible for the preparation of financial statements of the Company that give a true and fair view in accordance with the Norwegian Accounting Act and accounting standards and practices generally accepted in Norway, and for the preparation of the consolidated financial statements of the Group that give a true and fair view in accordance with IFRS Accounting Standards as adopted by the EU. Management is responsible 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. The financial statements of the Company use the going concern basis of accounting insofar as it is not likely that the enterprise will cease operations. The consolidated financial statements of the Group use the going concern basis of accounting unless management either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with 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 aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.For further description of Auditor's Responsibilities for the Audit of the Financial Statements reference is made to: https://revisorforeningen.no/revisjonsberetninger
Stavanger, 15 March 2024 PricewaterhouseCoopers AS
Roy Henrik Heggelund State Authorised Public Accountant (This document is signed electronically)
| Signers: | ||
|---|---|---|
| Name | Method | Date |
| Heggelund, Roy Henrik | BANKID | 2024-03-18 10:22 |
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