Annual Report (ESEF) • Mar 8, 2022
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Download Source FileUntitled Annual report 2021 Enhancing synergies 1 B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction Contents 01. Introduction 2 Key gures & events 3 At a glance 7 Message from the CEO 11 02. About B&S 15 Company prole 16 Our 2021-2023 strategy: Adapt to win 28 Value creation 36 03. Results 44 People & culture 45 Sustainable operations 53 Financial & segmental performance 63 04. Governance 77 Composition Executive Board & Leadership team 78 Composition Supervisory Board 80 Corporate governance 82 Risk management 88 Share information 97 Supervisory Board report 100 Audit and Risk Committee report 103 Remuneration report 105 05. Financial statements 114 Consolidated statement of prot or loss 116 Consolidated statement of prot or loss and other comprehensive income 117 Consolidated statement of nancial position 118 Consolidated statement of changes in equity 120 Consolidated statement of cash ows 122 Notes to the Consolidated Financial Statements 124 Other information 179 Independent auditor’s report 180 List of subsidiaries 185 Contact 185 Celebrate friendship B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statements 2 Introduction B&S is a tech company in the consumer goods industry with a very strong global network. We bring parties in the value chain all over the world together that are in many ways difcult to connect. Introduction B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction 3 Facts & gures People & Culture Headcount 2,008 (ex. temporary help) M / F ratio 53.0% / 47.0% Nationalities / continents 57 / 4 Turnover 615 Average tenure 5.6 Average age 37.6 Sustainable operations AEOS & AEOC status since 2008 ISO 22000 certied since 2012 ISO 9001 certied since 2020 ISO 14001 certied since 2020 USAPHC approved Ofcially registered supplier to UN global market place Member UN Global Compact since 2010 Commercial focus / Financial performance Organic turnover growth (0.3%) Acquisitive turnover growth 0.7% EBITDA margin 6.2% Return On Invested Working Capital 24.8% Net debt / EBITDA 2.5 4 B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction Key gures 2021 6 main focus areas All premium brands >100 countries Consumer goods Global spread of customers Turnover (in millions) Net cash (in millions) €1,869.5 2020: €1,861.8 ↑ 0.4% €14.8 2020: €147.0 EBITDA (in millions) Employees €116.4 2020: €90.3 ↑ 28.9% 2,008 57 nationalities on 4 continents 5 B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction Key events 2021 January ↓ March → April → May → → June → Ken Lageveen joins leadership team of B&S as Chief Operations Of cer. B&S increases majority stake in JTG and subsequently FragranceNet. com, therewith further aligning the companies in the B&S Beauty segment. B&S starts construction of new warehouse in Kolham, the Netherlands to facilitate expansion of the B&S Personal Care segment. B&S Food launches e-com platform to provide wholesale customers globally with easy access to the full assortment on a 24/7 basis. B&S introduces updated strategy and new operating segment structure to increase efciency and speed up decision making. The HQ of B&S Food and B&S Health in Dordrecht, the Netherlands refurbishes nearly 35,000 m² roof to realise 25,000 KG CO 2 reduction 6 B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction Arben Hajrullahu joins leadership team of B&S as Chief Commercial Of cer. B&S launches Signature Beauty, a new entity in the B&S Beauty segment with primary focus on the Luxury Beauty industry. B&S Beauty rolls out Fragrance.com in Australia and the Middle East. Overarching technology backbone B&S Nnity is completed to boost all business activities in all product catagories. B&S Retail signs MOU with Qatar International Airport and launches its new digital experience concept at Zurich airport. August ↓ October → November → In January 2022, B&S Group rebranded as B&S. B&S rebranding reects the unication of our operations into one better, stronger B&S. Our evolved corporate and visual identity embody our global reach and tech-driven approach to make premium consumer goods available to everyone, anywhere. To learn more: visit Welcome to B&S September → The HQ of B&S Food and B&S Health in Dordrecht, the Netherlands starts using solar panels – generating 3,5 megawatts annually. B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction 7 At a glance Enhancing synergies Instead of a group of companies, B&S is an integrated company with overlapping customers, services, assortments and channels. Although our operating segments and business units carry out distinctive propositions, they share the same backbone to enhance synergy and unlock new business potential – all driven by B&S Nnity. Our vision By seamlessly connecting all parties in the value chain through technology, we become the world’s leading network for easy access to premium consumer goods. Our mission To make premium consumer goods available to everyone, anywhere. → → 8 B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction B&S Liquors Branded premium liquors for wholesalers, e-commerce platforms and consumers. € million (unless stated otherwise) FY 2021 reported FY 2020 reported Δ (%) reported Turnover 540.9 575.5 (6.0%) Gross prot 56.9 36.6 55.5% EBITDA 28.2 12.9 118.6% EBITDA margin 5.2% 2.2% Geographic prole: Europe, Middle East, Asia Owned labels in our portfolio: B&S Beauty Branded premium fragrances and cosmetics for consumers, wholesalers and e-commerce platforms. € million (unless stated otherwise) FY 2021 reported FY 2020 reported Δ (%) reported Turnover 675.7 646.1 4.6% Gross prot 126.7 115.6 9.6% EBITDA 62.4 65.4 (4.6%) EBITDA margin 9.2% 10.1% Geographic prole: USA, Europe, Australia, Asia, Middle East Owned labels in our portfolio: Facts & gures per operating segment → → 9 B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction B&S Personal Care Branded premium personal and home care products for value retailers. € million (unless stated otherwise) FY 2021 reported FY 2020 reported Δ (%) reported Turnover 276.4 262.6 5.3% Gross prot 46.3 44.3 4.5% EBITDA 25.3 22.7 11.5% EBITDA margin 9.1% 8.6% Geographic prole: Europe Owned labels in our portfolio: B&S Food Branded premium food and beverages for duty-free, remote, retail and marine markets. € million (unless stated otherwise) FY 2021 reported FY 2020 reported Δ (%) reported Turnover 287.2 277.9 3.3% Gross prot 36.2 37.6 (3.7%) EBITDA 3.1 3.9 (20.5%) EBITDA margin 1.1% 1.4% Geographic prole: Europe, Africa, Middle East Owned labels in our portfolio: → → 10 B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction B&S Health Branded premium medical products and equipment for maritime and remote markets, pharmacies and travel clinics. € million (unless stated otherwise) FY 2021 reported FY 2020 reported Δ (%) reported Turnover 46.7 55.2 (15.4%) Gross prot 7.9 10.3 (23.3%) EBITDA 1.9 4.7 (59.6%) EBITDA margin 4.1% 8.5% Geographic prole: Europe Owned labels in our portfolio: B&S Retail Branded premium consumer electronics and multi-category assortments for consumers at travel locations. € million (unless stated otherwise) FY 2021 reported FY 2020 reported Δ (%) reported Turnover 42.5 44.5 (4.5%) Gross prot 11.8 8.5 38.8% EBITDA (1.5) (12.0) 87.5% EBITDA margin (3.5%) (27.0%) Geographic prole: Europe, Middle East Owned labels in our portfolio: “ We are a tech company in the consumer goods industry with a very strong global network.” Tako de Haan 11 B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction Dear stakeholders, As I write this letter, I reect on another year that was challenged by the uncertainty of the Covid-19 pandemic, yet encouraging as the shifting dynamics also provided opportunities for change. The disruption on global scale has been a catalyst for digital transformation that created new opportunities for both B&S and our business partners. Amidst the ongoing pandemic, business as usual for us was adapting to these changing circumstances. We continued to bolster the business that we have but also looked at different business opportunities, particularly e-commerce, which is the youngest business in the B&S portfolio. We’ve invested in expanding our direct-to-consumer platform, building an overarching e-commerce backbone for both the wholesale and retail sales and also linking our long tail assortments to external reseller platforms. Our growth ambitions in digital commerce are underpinned by an extensive global set-up and supported by our broad network of brands, suppliers, service providers, wholesalers, retailers and consumers. With that, our mission to make premium consumer goods available to everyone, anywhere enhanced further. I have had the privilege to see it in action throughout 2021. It is exciting to see how our platforms and solutions are enabling consumers and businesses globally to gain access to new assortments, new channels and new ways to grow their business. Message from the CEO 12 B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction Strategic update As an outcome of our adaptive and entrepreneurial mindset, in April 2021 we shared our three-year strategy towards a compelling high-tech global brand. The combination of our strengthened fundaments in a simplied structure, our evolving digital capabilities and commercial focus to expand our reach, resulted in a new set of medium term nancial targets. Our set objectives are to realise an average annual organic turnover growth of 7.5% and deliver 6% EBITDA margin in 2021 with at least 25bps increase year on year until 2023. Although delayed market recovery and on and off retail closures pressed 2021 turnover growth, we realised a 6.2% EBITDA margin, therewith beating our target of 6.0%. Underpinning our medium term expectations are four megatrends that drive expansion for our portfolio of trusted brands and labels. Globalisation, digitisation, disruption and selected distribution ask for a digital focused business partner with unmatched reach throughout the value chain. With our technology driven logistical set-up we serve wholesalers, resellers and brands end-to-end into places, channels and regions where they desire a (stronger) presence or establishment. Its fuels our strategy towards a high-tech business partner around the globe. Strategic progress In executing our 2021 – 2023 strategy we committed to three business priorities to drive long term value: People & culture For our People & Culture pillar, a critical topic was adapting to pandemic related challenges and needs. Throughout 2021 we focused on exible employment and mental health to keep our workforce motivated and healthy. In addition, the ‘great conversations’ concept was initiated to develop ongoing talks and feedback between managers and their employees. This initiative will launch ofcially in the rst half of 2022. Sustainable operations Although we were already embedding sustainable practices towards waste reduction and carbon footprint reduction in our own operations, we are progressing towards shaping our role in contributing to a sustainable value chain. In October, we initiated our 2022 sustainability roadmap. We plan to present our strategic objectives and accompanying targets at the time of our Half Year 2022 results publication. Commercial focus Throughout 2021, we delivered a good start to our one brand approach by executing well on our plans and adapting to changing market conditions quickly and adequately. The rebrand trajectory we undertook in 2021 represents our evolved business model with more unity in commercial activities and centralisation of operations within the B&S portfolio. “ We encourage employees to act as pioneers and entrepreneurs.” 13 B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction Even more so, we have delivered a step change in synergy potential of our businesses by unifying our business activities globally under the same B&S label and completing an overarching technology backbone ‘B&S Nnity’. This backbone enables us to service all channels, markets and geographies with our full assortment in one go. It’s the bedrock of our vision to become the world’s leading network for easy access to premium consumer goods. With the new strategy, we introduced a Leadership team – recruited internally – to fuel commercial focus based on our ‘Business in the lead’ principle. Ken Lageveen was appointed as Chief Operations Ofcer in January, Arben Hajrullahu was appointed as Chief Commercial Ofcer in August and throughout the year we appointed Managing Directors for each of our newly introduced operating segments. The progress we have made in 2021 would not have been possible without the engagement and support of our global workforce. We are fortunate to have such resilient, passionate people that breathe our entrepreneurial DNA. I want to thank each of my colleagues for their unwavering commitment, investment and inspiring optimism during the year. Not only have they navigated the business through another year of global restrictions in the duration of the Covid-19 pandemic; they delivered on opportunities that arose to make progress towards our strategic objectives. I also thank our shareholders for their support in our updated strategic direction and our suppliers, customers and business partners for their loyalty and for working with us through the pandemic by focusing on opportunities. Together with our stakeholders, we are enhancing synergies for sustainable growth. On behalf of the Executive Board Tako de Haan, CEO Read the story 14 B&S Group S.A. Annual Report 2021 About B&S Results Governance Financial statementsIntroduction business story Delivered solutions: Sourcing, Warehousing, Distribution, Digital commerce B&S and Alibaba connect European sellers with the Chinese market By establishing a strong relationship with Alibaba, we bring leading European brands to the thriving Chinese market. As a trusted supplier, Alibaba relies on B&S to expand their assortment with high-demand products, while our partners enjoy the endless opportunities of entering this exciting market. Ignite condence B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statements 15 About B&S About B&S Because of our drive to reach beyond the ordinary, we became the global player we are today. A company that excels in making premium consumer goods available to everyone, anywhere. 16 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S History It were the 1970s when two college friends took on a job for a local Dutch shipping company. The company offered sailing trips on international waters, providing passengers the opportunity to buy tax-free goods in a unique shopping experience. Recognising the potential of this concept, the two friends developed compelling ads in local newspapers to attract even more passengers. A phenomenal business decision. Passenger demand grew signicantly and with that, its sales. A few successful years later, the two friends took over the company. It was the birth of what we know today as B&S. Determined to expand its growth potential, B&S scaled up and grew its product and service portfolio in a rapid pace. Over the next decades, its supply chain capabilities, global network and trading expertise kept evolving in various distinctive markets and channels. Because of this drive to reach beyond the ordinary, B&S is the global player we are today. A company that excels in making premium consumer goods available to everyone, anywhere. Dutch by heritage, entrepreneurs by nature 17 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Who we are B&S is a tech company in the consumer goods industry with a very strong global network. With our digitised supply chain set-up, we serve brands end-to-end into places where they desire (stronger) establishment or in channels and regions where they have no stronghold yet. Reach Our entrepreneurial nature drives us to continuously expand our reach by adding new customers, new markets and new channels to complement and extend our business portfolio. Network With our ever-growing international network and local presence, we bring suppliers, brand owners, logistics partners, service providers, wholesalers, retailers and consumers all over the world together that are in many ways difcult to connect. Brands We partner with the world’s premium consumer brands in beauty, liquors, personal care, food, health and consumer electronics to serve millions of consumers daily - either directly or through our wholesaler and reseller partners. Technology Powered by our high-tech platform and arising from supply chain expertise, we provide sourcing, ware housing, distribution, digital commerce, marketing and brand development solutions that enhance choice, speed up delivery, drive conversion and increase reach. Passionate Being passionate and ambitious and taking pride in our work is ingrained in our DNA. It enables us to continuously renew our offering while staying true to our core strengths. Curious Our founders have built the company with their entrepreneurial spirit. That spirit still thrives. We stimulate ideas and encourage initiatives that contribute to sustainable long-term growth. Reliable Our actions reect our commitment to ethics and corporate social responsibility. We manage risks, never compromise on quality and always act honest and respectful. Personal We strongly believe that desirable products and services can only come from trusted companies. It’s reected in the way we do business. We focus on long-term business relations and work together with our partners to generate mutual success. 18 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Our way of working Our way of working aims to ensure that our business partners benet from the same guiding principles that have delivered the exponential growth of our own business. We have identied four pillars of performance and success that are recognised across all B&S companies and support our entrepreneurial culture. They ensure that every colleague understands what is important, how we work together as a team and how our purpose is at the center of the decisions we make. Leadership behaviors further guide our actions and decision-making so that we do the right thing for the business and our stakeholders, with reward being linked to delivery and performance. This helps create a culture where everyone feels accountable, talent is fostered, and colleagues can achieve their full career potential. Our why Our purpose is to connect brands to consumers everywhere. We believe that getting access to consumer products that bring joy and comfort into everyday lives, should be easy around the globe. CCO Commercial functions B&S Liquors B&S Beauty B&S Personal Care B&S Food B&S Health B&S Retail COO Logistics Facility PMO Data Science Sustainability CFO Finance & control Tax Treasury Risk & Audit Credit management Reporting CEO Strategy Marketing HR Communications IT Legal Executive Board members Leadership team members EUROPE MEA US E-commerce Corporate functions regions expertise B&S Liquors B&S Beauty B&S Personal Care B&S Food B&S Health B&S Retail 19 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Based on our ‘Business in the lead’ principle towards a streamlined and easy-to-understand organisation with a simplied supply chain, we have established a new organisational structure in 2021. C-level expansion To enhance progress on the implementation of its 2021-2023 strategy, B&S appointed a Chief Operations Ofcer and a Chief Commercial Ofcer in the course of 2021. Operating segment restructuring Dening the right balance between focus and accountability was key in the restructuring of our operating segments in 2021. We moved from three business mixed segments to six individually operating category focused segments with full P&L responsibility. Given the key role of geographical expansion in our strategic objectives, our MEA (Middle East & Africa), Europe and US regions were elevated into integrated elements working across all six operating segments. E-commerce was developed into an overarching platform in 2021 speed up growth of digital capabilities across all segments. This was the follow-up of the 2020 IT restructuring that introduced specialisms on corporate level with a dedicated e-commerce discipline. Corporate functions were further established according to the restructuring approach as initiated in 2020 to intensify segmental collaboration, streamline cost levels, support our commercial objectives and simplify communications towards all stakeholders. In 2021 we incorporated the Data Science function to support data- driven decision making across the board. Organisational structure B&S Service Providers Suppliers Retailers Consumers Logistics partners Wholesalers A-brands B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S 20 Who we connect We use our business acumen, smart logistics and IT to bring suppliers, brand owners, logistics partners, wholesalers, retailers and consumers all over the world together. We don’t own a eet, our network is our vehicle: we optimise the value chain by efciently linking parties that are in many ways difcult to connect. Via our high tech platform we make the best premium consumer goods available in every corner of the world. Enabled by our network. Driven by demand. Powered by marketing. B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S 21 Our markets We are an ambitious business with a global focus but a champion of the niches from which we originated. We leverage our expertise for deep local relevance in the markets we operate. Online Hospitality / on-trade Government & Defence Maritime & Remote Secondary and value retail Duty-free & travel retail Domestic / off-trade 22 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Our assortment focus areas Supplying quality medical supplies, pharmaceuticals, and vaccines around the globe. Health Supplying the best food and beverage brands at the highest food safety standards. Food Bringing the best liquor brands to consumers worldwide. Because premium liquors deserve premium service. Liquors Serving as a one-stop partner for personal care, cosmetics, and home essentials. Personal care Offering high-quality A-brand headphones, smartphones, travel accessories, lifestyle products, and exclusive gadgets. Consumer electronics Working with the best beauty brands in the world to bring our customers the products they desire. Beauty We partner with the worlds premium consumer brands in six assortment focus areas. Sourcing Solutions % % Warehousing Solutions 23 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Our solutions Our solutions are driven by our technology backbone B&S Nnity. They are delivered cross-sector and underpin our ability to handle a high level of supply chain complexity. It allows us to consistently connect our customers throughout the value chain in the right place, at the right time. Sourcing Our sourcing mechanism enables us to act quickly and benet from sourcing opportunities whenever and wherever they arise. Our BiT Insights tool (Developed within our proprietary Enterprise Resource Planning (ERP) system) provides full internal price transparency and compares real time sourcing prices, trends, and opportunities across our segments and markets. Our global scale gives access to a vast range of brands and products while our balance sheet allows us to take-in and supply large quantities at favorable prices. This enables us to serve our customers with a large in-stock assortment on demand. Logistics & Warehousing Our digitised and automated warehousing solutions speed up operations and resourcefully match demand with efciently procured supply based on data intelligence. This is all facilitated and supported by our technology backbone B&S Nfnity. Our logistics expertise enables us to serve difcult to reach markets, while our e-commerce solutions allow for ordering from any location on a 24/7 basis. This enables us to continuously expand our reach, both for ourselves and our business partners. Distribution Solutions Digital commerce € € € 24 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Distribution We operate a fully bonded supply chain with warehouses that have a registered status to store goods under bond. This allows us to distribute our product assortment internationally without having to pay import duties, VAT or excise duties anywhere other than in the end-market. Our extensive customs knowledge and regulatory expertise allows for a smooth international supply chain across borders with all relevant paperwork in order, from product sourcing to delivery, from full container loads to drop shipped packages to the doorstep of consumers. Digital commerce Our B&S Nnity backbone brings together the best that B&S has to offer and delivers it in one seamless digital experience. B&S Nnity powers e-commerce growth of wholesalers, resellers and brands and provides consumers with easy access to premium brands in a digital setting. Through this state-of-the-art platform we connect brands and customers cross-border with e-commerce technology, operations and data. Marketing Solutions Brand development 25 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Marketing Powered by our cross-sector experience, we help our customers plan and execute powerful B2C and B2B marketing campaigns to grow their business. By combining hypertargeting capabilities, in-house developed brand and product marketing campaigns and deep knowledge of local markets, we can connect brands directly with consumers, decision-makers and inuencers around the globe. And by using our experience and exposure as a physical retailer ourselves, we can develop in-store promotions and activations that generate results for our brand partners. All while keeping track of return on investment, aided by our B&S Nnity backbone. Brand development We help established global brands as well as the up and coming grow their brand equity globally. Via a wide variety of channels in our portfolio we connect brands to new and / or non-conventional markets. Our solutions are tailored to the maturity of the brand and can range from development of high-quality product and packaging (together with our industry partners) to tailored marketing services and a detailed distribution plan for a selected new channel. Either the full package or just a single service, we can develop brands in any stage successfully in close cooperation with their owner. Read the story B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S 26 business story Delivered solutions: Distribution, Marketing, Brand development As a strategic partner, we provide tailored solutions to develop and grow brands. Aligned with brands’ growth objectives, driven by data, and designed for long-term success. We work with bold companies with ambitious goals. Like BALR. By building on their strong foundation, we developed a luxury perfume line, boosted brand awareness, and created a sustainable revenue stream that will contribute to their international growth. Here to stay: How BALR. became a key player in the fragrance market € 61.4 million Africa € 294.0 million Asia € 139.7 million Middle East € 12.3 million Oceania € 36 0.1 million America € 1,002.0 million Europe 27 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Our locations B&S has strong positions in distinct markets and selected channels in Europe, MEA and US. Serving 100+ countries and complex end-markets Turnover per region B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S 28 Our 2021-2023 strategy: Adapt to win Our overall focus lies on long term value creation by pursuing sustainable and protable growth. Going forward we realise that we need to strive to positively impact all our stakeholders. The ability to respond and adapt to changing circumstances and demands from our markets, our business partners and society is key in executing on our strategy. In April 2021 we presented our strategic direction 2021 - 2023 including the following highlights: Strengthened fundaments - Business in the Lead, Digital First and Scalable Operations – to enable turnover and margin improvement; One company, one brand, one vision approach in proling B&S to all its stakeholders; Redened operating segments and corporate support functions to increase efciency and speed up decision making; (organisational structure) Digital Innovation to drive growth, accelerated by: Expanding our global network with growth markets Developing our product portfolio driven by consumer demand Marketing premium consumer goods brands to maximise conversion One brand approach The rst opportunity to adapt for positive impact, is to articulate clearly as one strong company, instead of a global conglomerate of entities. As B&S, we provide millions of customers globally with their favorite brands of consumer goods on a daily basis yet there is little recognition of the company behind this strong network. The redevelopment of our brand proposition that was launched January 2022, is a rst milestone in our one company, one brand approach by linking all business activities to the B&S name. This unied brand proposition will be rolling out across all B&S touchpoints and platforms over the course of 2022. Organic turnover growth Acquisitive turnover growth EBITDA margin Net debt / EBITDA Return on Invested Working Capital (ROIWC) Dividend policy >6.0% + 25 bps p.a. <3.0 >25% 40% pay-out Total >15.0% p.a. Dividend Pay out to increase with net debt / EBITDA <2.0 Financial objectives 2021-2023 >7.5% p.a. >7.5% p.a 29 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Strengthened fundaments for organic growth Target average organic turnover growth of 7. 5% per annum With close commercial involvement further centralise IT and Logistics towards creating a more lean and focused organisation Cluster overlapping segmental business activities to simplify the supply chain and optimise inventory management Intensify segmental collaboration by optimising internal processes Scalable operations Use data driven insights to optimise internal processes and identify commercial opportunities Digitise supply chains with commercial tools that support centralised operations Continued innovation by embedding digital capabilities in our organisation Digital rst Capture opportunities for geographical expansion in all business segments Cross selling of assortments in new and existing markets Explore new Product Market Combinations in adjacent channels or product / category per segment Focus on selected markets driven by mega trends (digitisation, globalisation, market disruption) Invest in unique positions with compelling advantage Drive organic growth through digital and data driven solutions Complemented by selective M&A to strengthen niche positions Business in the lead 30 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Introducing the redened B&S organisation Opportunities for organic turnover and margin growth are supported by our three regions Business in the Lead, Scalable Operations, Digital First, to speed up company decision making. Our Business in the Lead principle has already led to segment reorganisation from three mixed business segments to six category focused segments with clear P&L responsibility. To support all commercial activities centrally at corporate level, we bundled overlapping segment support functions (e.g. marketing, HR, IT, facility, legal) and appointed functional experts internally to head up the function at corporate level. Scalable operations “In Q1 2021 we initiated consolidation of activities within the Liquor segment. We started by integrating the back-end and creating one eco-system for all Liquor companies. In the rst step we integrated the international distribution companies and implemented our proprietary BIT-Insight application for all companies, giving our commercial people all market and pricing information real time to make the correct decisions for the company based on predictive data. All Liquor companies still operate as separate entities to their markets to foster entrepreneurship and maximise growth within their specialised activities but the procurement, back-end and the market knowledge and data are now centralised. Apart from the backbone, we initiated the process for physically integrating warehousing to optimise B2B activities and expand into B2C business. In Q2 we started the process of realising a centralised warehouse with strategic hubs to service a larger long-tail assortment that ts our digital and consumer business concepts. In Q3 our efforts already facilitated the geographical expansion of our online B2C Liquor concept from Spain towards France, Austria, Denmark, Germany and the Netherlands.” Arben Hajrullahu, CCO and Managing Director B&S Liquors For customers, this change will optimise access to our global capabilities and experience, allowing for best-in-class solutions along the value chain to speed up decision making, enhance choice and increase reach. We identied the efciency gains for our Scalable Operations fundament through centralisation of logistics and warehousing solutions. Also, we put a Project Management Ofce in place to ramp up project efciency at overarching corporate level. Centralised Liquor operation 31 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Digital Innovation Building B&S Nnity Over the years we have built an extensive global network of suppliers, brand owners, service providers and customers. In parallel we have aligned the internal organisation by migrating companies to the same ERP system, lining up our logistics for e-com activities and building the fundament of an e-commerce platform. As part of our strategic focus we keep expanding this technology backbone under the name “B&S Nnity” where all parties in the value chain get connected and where they tap into the B&S eco system. B&S Nnity is our technology backbone that is fully integrated with our ERP system and seamlessly pushes and retrieves order-data from one to a hundred thousand customers per minute. Through our B&S Nnity backbone we offer suppliers and brand owners a direct link and connection to our global network of warehousing, distribution services and customers in our various business models – enabling them to serve wholesalers, resellers and consumers alike. At the other end of our B&S Nnity backbone we enable our diverse customer base to connect to our digital ordering platform for true digital purchasing experience. Wholesale customers can order from our closed webshops with easy subscription to get started. Resellers can use our e-fulllment solutions through B&S Nnity. In short, they sell the product to their consumer and B&S picks, packs and delivers to consumers’ doorstep. B&S Nnity also caters to our owned B2C business model, offering goods directly to consumers through our various webshops. All data retrieved from B&S Nnity will help us in further developing our business models, and strengthening our relationships with all customers in the value chain. Data-driven decision making Our Data Science discipline was headed up at corporate level in 2021 as a cornerstone of our digital strategy, fueling decision making and platform development by enabling us to determine the next steps in our digital business models. Data Science supports the daily decision making process with projections and predictions as well as scenario analyses in key focus areas: Signaling - what is happening (e.g. signicant price changes/ availability of products in our sourcing activities) Predicting - (e.g. future sales, purchase advise, people needed in the logistics process) Simulation - (Performance of new facilities and existing facilities with suggested changes) Optimisation - (locations of hubs, stock allocation in the warehouse, usage of our robotised warehousing, algorithms for put away and pallet stacking) 32 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S 2021 was a step change for our team of Data Scientists and their role within B&S. First of all, the discipline was moved from segment level to corporate level to facilitate all business facets of B&S with relevant data retrieval and analyses. Besides focused projects for certain business units and sub operations, this year we have identied and progressed in key focus areas to support overarching company objectives with data- driven decision making. One of our focus areas was joint stocks and assortments. In 2021, B&S brought its Liquor activities together in a long-tail strategic hub. Determining the location, calculations of assortments and working capital reductions to decide on optimal arrangement of this hub are supported by Data Science. Also, simulations of the new design and level of automation for this hub have been replicated. Together with our colleagues from other departments we managed to go from a classic warehouse environment in our Liquor segment to a warehouse ready for trade B2B, wholesale and B2C activities all in one. The second focus area was Algorithms Development. For our Beauty, Liquors and Retail segments we developed algorithms for monthly and weekly purchase advise over the course of 2021. As an example, in the Retail segment we predicted and automated daily minimum stock levels, reducing complexity for the stores and taking care of redundant stocks per location. Replenishment optimisation throughout the rest of B&S is catered for by using the same algorithm. We also spend time on cost reductions and Working Capital improvement. Here, Data Science helps not only in simulating for new logistics locations and improving current processes; it also supports our daily activities with replenishment for internal logistics & store distribution, short-term workload predictions & people planning and put away and output related predictions and advice. Another great learning for our Data Science team has been working together with the team of Fragrance.com on Dynamic Pricing. With intelligent pricing strategies based on market data and pricing rules, we are able to safeguard a minimum margin target and meanwhile adjusting to the changing conditions real-time. In this manner we can optimise sales and maximise the prot on our items, both at B2B and B2C level. Data Science supporting optimal decision making Digital Innovation Target average acquisitive turnover growth of 7. 5% per annum 33 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Selected acquisitions form an integral part of our growth strategy and complement our four strategic focus areas further. Many markets in which we are active are very sizable and highly fragmented by nature, providing ample opportunity for targeted acquisitions that support our philosophy. We maintain a regular dialogue with various market participants to ensure that we are ready to execute on the right opportunities when they occur. Acquisition strategy We believe it is important to enter into acquisitions as partnerships or joint ventures, keeping management on board and fostering the entrepreneurship and co-ownership that characterises the B&S DNA. Strict criteria are applied when evaluating and selecting potential acquisition candidates. We remain disciplined on price, offered in combination with an attractive proposition to the selling management and shareholders. This includes their continued involvement and investment in the combined company, ensuring we maximise the benets of growth and synergies. This secures their business acumen at the front end, while we put our immediate focus on the integration of back ofce and controls. All our acquisitions to date were executed to further strengthen our position in the value chain either by adding complementary sourcing routes, by entering into new product categories / regions as an extension to our existing business, or by expanding our role in the value chain by adding direct-to-consumer. Going forward, we look to further execute our acquisition strategy and build our position in the value chain with carefully targeted companies that match both our business model and our entrepreneurial culture, and that show potential for further organic growth. Sweet spot of 100-200 M Always majority stake initially, with preferably a total buy out option between 3-5 years Protable pre- acquisition (no turnarounds) Sitting management willing to remain on board in initial phase (5 yrs) Synergy potential in turnover and / or margin 6-8 times EBITDA Start Köpcke Start Paul Acquisition Anker Acquisition JTG B&S World Supply founded Acquisition Alcodis Acquisition FragranceNet. com Acquisition Airport shops Weeze & Rotterdam Butterfahrt founded by Blijdorp & Streng B&S Segment created as merger of Bosman, Köpcke and Paul Acquisition Royal Capi-Lux Acquisition Topbrands Acquisition Lagaay Medical Group Acquisition Top Care Start Bosman 1872 1912 1948 1974 1999 2001 2007 2012 2013 2016 2017 2018 2019 2020 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S 34 Acquisition timeline 35 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Business priorities The cornerstones of our 2021 – 2023 strategy are our business priorities - People & culture, Sustainable operations and Commercial focus. These are the key enablers to guide B&S through its transformation towards a strong global brand. Being an employer of choice is an essential pillar to execute our strategy. We focus on nurturing talent to become inspirational leaders of the future and attracting digital savvy talent that drives a digital culture. Our people & culture agenda is being tailored to our Digital First approach to enable B&S to be a high-tech business partner and employer. Building on our one brand proposition, we aim to dene clear purpose that resonates and that our stakeholders can relate to. Key priorities Providing an entrepreneurial and inspiring environment Attracting, retaining and developing a workforce with capabilities that support our growth strategy Maintaining high ethical standards with all our stakeholders We are building the B&S Brand for future generations. We aim for carbon footprint reduction by rethinking our resources, driving awareness amongst employees and business partners and embedding sustainable ways of working into our daily business operations. We are committed to stepping up our approach and will dene core focus areas with corresponding targets in 2022 that link to our strategy. Key priorities Being a responsible, well-respected and reliable organisation while at the same time seizing business opportunities Mitigating environmental risks and adhering to all relevant regulations Creating opportunities for a sustainable and innovative supply chain We focus on product-market-channel combinations in business-to-business, business-to-reseller and business-to-consumer where B&S can be a frontrunner and maintain or obtain leading positions by expanding its network, product portfolio and / or drive conversion through marketing. It concentrates on six newly dened operating segments: B&S Liquors, B&S Beauty, B&S Personal Care, B&S Food, B&S Health and B&S Retail to better leverage expertise, identify white spots and drive efciency supported by our Digital First approach. Key priorities Creating long term value for our stakeholders by pursuing sustainable and protable growth Clear focus on building and expanding unique positions in diversied markets Expanding our role in the value chain People & culture Sustainable operations Commercial focus More on progress in 2021 in section Results More on progress in 2021 in section Results More on progress in 2021 in section Results B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S 36 How we add value People & Culture • Highly educated (young) professionals with focus on expan- ding our business profitably Sustainable operations • Connecting supply and demand for consumer goods in niche markets around the globe • Creating strong barriers to entry by scale, extensive licensing, customs knowledge, robotisation and digitisation Commercial focus • Equity and loans help us to invest in the growth of our business to service our stakeholders Input Value creation Output People & Culture • 2,008 (ex temporary help) • 57 Nationalities on 4 continents Retention of 5.6 years Sustainable operations • >40.000 SKUs * available on demand globally with distribution options from bulk supply to drop-shipment • Long term partnerships based on trust, expertise and mutual growth • 3,930,000 KwH self- generated solar power Commercial focus • Turnover € 1,869.5 million • 6.2% EBITDA margin • 2.5 Net debt / EBITDA • 24.8% ROIWC Employees • Inspiring work environment with development and career opportunities Suppliers & customers • Global business develop- ment in niche markets and specialised channels Investors • Long term value creation Authorities • Trustworthy partner with strict focus on compliance Society • Social and economical inclusion Contribution to relevant SDGs Connecting the value chain through technology Delivering premium consumer goods to everyone, anywhere Sourcing Logistics & Warehousing Distribution Digital commerce Marketing Brand development Outcomes for stakeholders * Stock Keeping Unit 37 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S We continuously adapt and develop our organisation to benet from changing conditions in our business environment that support sustainable and protable growth. In light of our enhanced brand proposition, we consider the following trends most relevant to our operations: Globalisation: Globalisation asks for tech driven business partners that can work seamlessly around the globe. With operations in Europe, Asia, Africa and America and our digitised supply chain capabilities we can support our suppliers and customers in nearly any location. This further supports our diversication strategy and focus on expansion into new geographies and adjacencies driven by technology. Digitisation: Digital technologies open new possibilities to serve customers more efciently and change the way we work. They also provide opportunities for additional services such as data driven sourcing, automated procurement, e-fullment and digital campaign development to serve our current customer portfolio as well as develop new business opportunities in our diversied markets, with the main growth driver being e-commerce. Retail value chain redesign / disruption: Increasing demands from consumers in delivery time and quality require continuous innovation to provide efcient and advanced distribution solutions. The rise of value channels and shift to online has further increased customer concentration into non-traditional channels. This asks for capabilities in the eld of digital lead generation, marketing services and data analytics. Additionally, more intense and more rapid communications allow consumer everywhere to purchase products anywhere around the globe and to access information about what to buy. This requires a wide and varied online product range that is always in stock and available on demand at attractive pricing. Selected distribution: In general, there is a clear demand from A-brand owners and suppliers for distribution partners that can offer supply chain simplication and sustainable growth in both emerging and developed markets. The markets and channels in which we operate are highly fragmented and require a partner that can offer a one-stop-shop solution with a wide and relevant range of products. Suppliers in developed markets are increasingly looking to centralise (parts of) their distribution with selected key partners. Entering into selected partnerships with a reliable and long-term focused partner enables them to outsource (parts of) their business operations and signicantly simplify their route-to-market. Additionally, the specic consumer demands in terms of delivery times and reliability are expected to continue to drive the trend among suppliers, brand owners and manufacturers of outsourcing part of their sales to a selected number of specialty distributors. Sustainability and climate change: Today the global community is increasingly aware of pressing challenges such as climate change, natural resource scarcities and extreme inequality and poverty. This results in consumers being more mindful of the environmental and social impact of the products they buy. Governments pose increasing regulatory requirements on both supply chain and product transparency. In Europe, the commission pushes towards a uniform sustainability language by adopting the EU Taxonomy in 2021 and pushing large companies to disclose on their added value towards society going beyond merely the creation of nancial growth. Evolving trends to drive growth “ Creating value for all stakeholders is at the core of our strategy.” 38 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S What matters to our stakeholders Creating value for all stakeholders is core to our strategy and long-term growth path. We therefore focus on building and developing meaningful relationships with suppliers, brands, logistics partners, customers, employees and society. Even more so, we enable them all to connect through our unique supply chain solutions. Employees: Our people are our most important asset. Our experienced and highly- qualied employees are making the difference when it comes to serving our stakeholders. Professional development of our people is key to our future growth and focus on providing an inspiring work environment. We encourage employees to speak their minds and we inform and consult them on key developments regularly both directly and through our Works Councils. Customers: Our global customer base is widely spread, and includes wholesalers, resellers and consumers. In order to align interests we foster a climate of mutual awareness and understanding. With business customers we focus on long-term partnerships based on expertise and engagement, which enables us to embed sustainable practices that meet diverse needs of all our customers. Suppliers, brand owners & service providers: We maintain relationships with premium brands and service providers along our value chain globally, engaging in mutually benecial relationships to simplify the supply chain. All our business relations are subject to strict KYR (Know Your Relation) procedures to ensure that our supply chain is transparent, not in breach with any regulations and that we are not infringing any intellectual property or trademarks. Investors: Our nancial stakeholders play an important role in our long-term strategy to create value. We strive to inform them as completely and transparently as possible on our strategy and nancial performance through a variety of communications such as AGMs, conferences, roadshows, press releases, site visits, emails and calls. Authorities: Ensuring food and product safety, customs compliance and adherence to local rules and regulations in all our international (logistics) operations is of utmost importance. That is why we emphasise on upholding good relations with authorities and governmental bodies throughout our value chain by maintaining close contact and adhering to all relevant rules and regulations. Society: Although our activities vary widely in their potential impact, we aim to add value for both B&S and society at large. We are involved in numerous partnerships and collaborations with educational institutions, human rights organisations and sector associations to exchange knowledge and know-how and to provide better living conditions for those in need. 39 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S To identify key material topics that support sustainable and protable growth, we rely on frequent and open communication with our stakeholders. We are committed to mitigating environmental and social risks related to our operations and creating opportunities for a sustainable and innovative supply chain, while at the same time seizing business opportunities that support our growth strategy. Based on our stakeholder analysis, we conducted a materiality survey among stakeholder representatives that was based on a list of 12 material topics. These material Materiality analysis topics were the result of an assessment of 21 initial topics drawn up together with an independent third party and based on ESG benchmarks combined with a media and peer analysis. The assessment took into account the concept of materiality as dened by the Global Reporting Initiative (GRI). Stakeholder representatives were asked to take a survey to rate all 12 material topics on a scale from 1 to 10 based on importance in relation to how they impact these stakeholders, society, the environment and the economy. Material topic Description Business priority Relevant to Governance & accountability Implementing policies and practices to ensure accountability and risk management by the board and meet stakeholders expectations Commercial focus Investors, authorities Long term partnerships Upholding good reputation with business partners and focusing on adding value to our partners’ businesses to support their growth and our own Commercial focus Investors, suppliers, customers People development Committing to hire, manage, develop and retain talented employees People & Culture Employees, society Employee well-being Promoting and protecting the physical and mental well-being of employees and helping employees make more informed decisions to achieve and maintain a healthy lifestyle Empowered people Employees Safety in the workplace Targeting zero accidents in the workplace and promoting safe employee behaviours in every location were we conduct business People & Culture Employees Cyber security & data privacy Setting up and adhering to the right policies and control framework to keep business, customers and employees’ data safe. People & Culture Employees, customers, suppliers 40 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Material topic Description Business priority Relevant to Business ethics Upholding ethical principles in the business relationships and activities by adhering to strict internal policies and guidelines to avoid corruption, bribery, fraud and other unethical behaviour People & Culture All stakeholders Waste management Reducing waste and optimizing opportunities for recovery, reuse or recycling of by-products, and disposing of waste appropriately. Sustainable operations All stakeholders Innovative supply chain Promoting innovative technology to create new ways of conducting business Sustainable operations All stakeholders Customs compliance Ensuring compliance with all relevant rules and regulations to uphold our relationship and status with customs authorities Sustainable operations Authorities, suppliers, customers Food safety Ensuring a high-quality product and preventing health risks arising from use, consumption, handling, preparation and storage throughout the value chain. Sustainable operations Authorities, customers Energy use Implementing energy saving / energy efcient ways of working and using energy responsibly in our premises and in the value chain Sustainable operations All stakeholders 6.00 6.50 7.00 7.50 8.00 8.50 9.00 9.50 10.00 6.50 7.00 7.50 8.00 8.50 2 3 4 5 6 7 8 9 11 1 12 10 Relevance Impact 41 B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S Materiality matrix Based on the materiality survey and the dialogue that emerged from it, we identied the main topics of importance to our stakeholders and our Board members. These topics were connected to corresponding business priorities that support the strategic growth areas we identied in 2021 for the coming years. Outlook for 2022 In light of our 2021-2023 strategic direction and spurred by the new Corporate Sustainability Reporting Directive (CSRD), we will undertake an updated materiality survey in 2022 to further align our strategic (sustainability) objectives and business priorities with the interests of our stakeholders through the performance of the double-materiality concept. More details on planned actions for 2022 related to our sustainability journey including ensuring compliance to the CSRD can be found in the Results and Governance sections of this report. People & Culture 3 Business ethics (ethical decision making, AML policies, FCPA, KYR) 4 Cyber security & data privacy (cyber security, data protection, GDPR) 5 Safety in the workplace (working conditions, incident rates, prevention measures) 6 People development & talent development (trainings, educational programs, career opportunities / promotions) 7 Employee well-being (remunerations, rotational opportunities, healthy lifestyle support) Sustainable operations 1 Customs compliance (AEO Status, adherence to Union Customs Code) 8 Innovative supply chain (automation & robotisation, data-driven services) 9 Food safety (licensing, transparent product information, quality controls (NVWA)) 11 Energy use (renewable energy use, energy- efcient ofces, efciency of operations) 12 Waste management (recycling procedures, waste reduction, sustainable packaging) Commercial focus 2 Long-term business relationships / partnerships (value adding services, grow with our partners) 10 Governance & accountability (board effectiveness, succession planning, transparent reporting) When it comes to our employees and all people involved in our operations, focus lies on providing an environment that is safe and healthy and stimulates well-being in all its facets; from food safety throughout the value chain to supporting local rst initiatives and from strict safety procedures in our premises to motivational support in maintaining a healthy lifestyle. We employ over 2,000 people globally and reach a wide range of suppliers and customers in diversied markets all over the world. This way, we play a key role in generating rewarding work opportunities, high level working conditions and a contribution to economic growth. Developing innovative and sustainable distribution solutions that connect the consumer goods value chain, reduces inefciencies in sourcing, services and distribution in the sector. With our robotised and digitised warehousing platform, we contribute to the innovation and efciency of the supply chain in which we operate and facilitate further economic growth. We are member of the UN Global Compact since 2010. We contribute to the development and implementation of international norms and standards and we do this by focussing on the areas of anti-corruption, labour rights, human rights and environmental practices in all our own operations. Through our distribution activities to government, defence and peacekeeping operations, we contribute to advancing peace and development. B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S 42 Sustainable Development Goals We support the Sustainable Development Goals (SDGs) that are directed at fostering sustainable development around the world as dened by the United Nations in 2015. We contribute to the SDGs through our main business activities and sustainable growth priorities. As B&S conducts business in numerous niche markets around the globe, the four selected SDGs are a general representation of the key areas where we contribute as a whole rather than in all the business activities we undertake. Read the story B&S Group S.A. Annual Report 2021 Introduction Results Governance Financial statementsAbout B&S 43 business story Delivered solutions: Distribution, Marketing, Brand development BAS channels = border store, air, and sea channels B&S connects premium brands with our global network of customers. That takes more than mastering the supply chain. By dedicating ourselves to the growth of Mars Wrigley’s travel retail business with tailored distribution solutions, strategic brand development efforts, and engaging marketing campaigns. How Mars Wrigley grew signicantly in the BAS channels with B&S Everyday comfort B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statements 44 Results Our overall focus lies on long term value creation by pursuing sustainable and protable growth. Going forward we realise that we need to strive to positively impact all our stakeholders. Results “Being an employer of choice is an essential pillar to execute our strategy.” UN GC Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights; and UN GC Principle 2: Make sure that they are not complicit in human rights abuses; and UN GC Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining; and UN GC Principle 4: The elimination of all forms of forced and compulsory labour; and UN GC Principle 5: The effective abolition of child labour; and UN GC Principle 6: The elimination of discrimination in respect of employment and occupation; and UN GC Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery. Supporting UN Global Compact Principles B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults 45 People & Culture Average age 37. 6 Continents 4 Nationalities 57 Employees 2,008 (excl. temporary help) Certied since 2020 ISO 45001 Committed to UNGC since 2010 New hires 825 Turnover 615 Average employee tenure in years 5.6 Health 95 Food 358 Beauty 603 Liquors 116 Retail 235 Personal care 216 Corporate 385 Liquors Beauty Personal care Retail Health Food Corporate 47% 53% Female to male ratio <25 25-35 35-45 >45 13.5% 37.5% 21.6% 27.4% 46 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Key gures 47 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults To support the path towards an employer of choice, we initiated a review of our employer value proposition in light of the 2021 – 2023 strategic focus towards a tech company. We also continued our efforts to add value to academic programmes by offering online guest lectures, digital student mentoring and web based recruitment events. We offered digital ofce tours to familiarise young professionals with our organisation and career opportunities during Covid-19. In addition, we facilitated better contact between managers and candidates through the launch of a new recruitment system. This allows managers to have more insight in the recruitment procedure and enables an increased involvement from them from the start. In 2021, 825 new employees joined B&S. Overall turnover was 615. Development, retention and mobility Providing a career path to management positions for high potential employees is one of our priorities in continuously meeting changing demands of our stakeholders and the markets in which we operate. With clear focus on intellect and t, we identify the next generation of leaders. We train and develop high potential staff for (future) leadership roles and offer external management programmes and university masters in their eld of expertise. Over the years, B&S has developed an entrepreneurial and highly motivating management culture evidenced by a vast majority of current management that started their careers with the Group. They set an example and act as inspiration for new recruits, illustrating the career development and opportunities open to them at B&S. Additionally, we aim to support the continued employability of our staff by keeping employees healthy and motivated through to their retirement. People development Material topic 6 Ambition: we aim to hire, manage, develop and retain talented employees. Our staff is our most important asset. They ensure business continuity and growth by building strong relationships with our business partners. Talent attraction A sizable part of our recruitment policy is focused at young professionals. Maintaining close relationships with universities and selected business schools is key in that approach. By providing guest lectures, career days, internships and dedicated learning projects we add value to academic programmes and can simultaneously spot, attract and select talent early on. For medior and senior roles, recruitment is based on relevant work experience, qualications and organisational t. The same standards and application procedures are adhered to in all our business segments in all locations. In 2021, our overall recruitment policy was sharpened on the back of our strategic direction and proposition as a tech company in the consumer goods industry. This resulted in the installation of dedicated corporate recruiters for selected key areas (for example IT & E-commerce) as well as focus on the attraction of senior proles for key disciplines in the eld of marketing, e-commerce and sustainability. 48 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults In 2021, we further implemented the People & Development (P&D) programme we revised in 2020. This three track concept supports our staff in every stage of their career through a tailored onboarding, advancement and professional track. After launching the onboarding track in 2020 for new recruits, this year we launched our advancement track for staff with at least two years of experience at B&S. The track focusses on personal development aspects in preparation for leadership roles. Amongst others the programme offers e-learning, podcasts and a B&S lean challenge during which staff works together on a company issue to enhance project management and problem-solving skills. In addition, it includes personal leadership days during which attendees explore and dene their personal drivers and ambitions. The professional track is planned for roll out in 2022. Our P&D programme is complemented with attractive remuneration programmes, sustainable employability programs and rotational opportunities across different disciplines and in all our business segments in all locations. In 2021, the average employee retention rate was 5.6 years. Inspiring work environment Employees at all levels are trained, encouraged and incentivised to identify new markets, new products, new sources of supply and new ways to expand our business protably. Over the years this has resulted in a global presence, adjacent assortment expansion and continued expansion of our role in the value chain. We stimulate our people to work on their own initiative and we encourage them to act as pioneers and entrepreneurs. To ensure a high-quality working environment, we provide direct access to senior management, encourage employees to speak their minds and inform and consult them on key developments regularly through management updates. Staff is kept involved and informed on key organisational developments and business updates from the Executive team throughout the year by regular companywide communication. Equal opportunities & inclusion We strive to provide equality of opportunity as an employer to all staff and potential staff in terms of remuneration, recruitment, promotion, training and access to opportunities. The principles of equal opportunities are well embedded in our company’s approach and objectives in respect of our workforce. Recruitment of staff is done on the basis of equal opportunity, irrespective of gender, marital status, sexual orientation, ethnic origin, religion or physical ability. All staff involved in recruitment, selection and remuneration are made familiar with their responsibilities with regards to ensuring equality of opportunity for both current and prospective employees. Additionally, we strive to improve inclusion in the local societies where we have operations, both by providing employment and donations. We practice ‘local rst’ in our local operations for example in Mali. In our logistics operations in the Netherlands we provide guided work placements for people with a distance to the labour market. We continue our partnership with the Dutch food banks through the donation of both food and non-food items to those in need. Furthermore, in 2021 we partnered with the foundation Kemi Malaika by providing our distribution and logistical network solutions to store and transport school equipment from our warehouses in the Netherlands to Senegal. 49 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Employee well-being & employability Material topic 7 Ambition: we aim to promote and protect the physical and mental well-being of employees and helping employees make more informed decisions to achieve and maintain a healthy lifestyle. The health and well-being of employees in all our international locations is central to our operations. Our long-term plan of approach (initiated 2019) to increase employability on the back of increasing importance of a healthy work-life balance and the increasing pensionable age in the Netherlands was reviewed end 2020 in light of the pandemic. For 2021 it resulted in enhanced focus on employee development, healthy lifestyle support (work/life balance) and employee satisfaction. As such, we established a dedicated employability team over the course of 2021. In 2021, in light of the pandemic our priority continued to be working from home wherever possible and having adequate measures in place at work locations for vital functions that required on site presence. Measures which were put in place in 2020 continued or where reinforced throughout 2021. Examples include increased spacing between workstations, adjusted routing on premise, appropriate protective equipment, staggered shifts and breaks, enhanced cleaning processes and contingency planning, as well as a ban on non-essential travel and visits to our facilities. Special attention in 2021 was devoted to supporting employee health during the pandemic. As an example, we offered our staff to participate in a voluntary medical prevention survey in order to create awareness and provide tools in having a healthy lifestyle. In addition, we conducted an employee satisfaction survey which we aim to perform every year going forward. The survey outcomes demonstrated that whilst our staff values the entrepreneurial spirit of the company, improvement potential was identied in the eld of learning & development and reduction of work stress related aspects. As a result of the survey outcomes, we initiated several activities dedicated to stress relief. Amongst others, we participated in the ‘Week of Work Stress 2021’ organised by OVAL. During this week we enabled our employees via an online community of tools to gain awareness and receive tips and tools for dealing with (imminent) stress, setbacks, and unexpected change. In addition, we provided training for team managers in our logistics operations in the early signaling of stress and ways to provide team members with help in preventing or overcoming stress at an early stage, therewith supporting prevention of absenteeism. We further established our in 2020 developed generation policy. It is aimed at providing a suitable and just work environment for those with changing necessities due to an increased age. Examples are no overtime work and the organisation of pension information days to increase know-how about this topic. Also, we laid the foundation for an updated performance review cycle to evoke a continuous, open dialogue about contributions and development between managers and their employees. Additionally and on top of our People & Development programme, we will further expand our training programmes for all employees at all stages of their career and tailored to requirements in their respective eld of work. This will be realised by the dedicated learning & development team that will be established in 2022. 50 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults To continuously guarantee safety in the workplace, we have a Safety & Security discipline in place that is committed to safety management, security management and integrity & review. This discipline houses a Safety & Security committee with direct report to executive management. The committee meets on regular basis and gets informed by other liaised disciplines such as QHSE, facility and HR on relevant developments and ndings. In 2021, we sustained our continuous focus on compliant operations to keep in tune with market standards and stakeholder requirements. We renewed our ISO 45001 certication (Working Conditions) of our Dordrecht location. Besides this, in 2021 we performed a Risk Inventory & Evaluation (RI&E) for all our Dutch locations as part of Dutch labor regulations. This assessment resulted in a clear-cut improvement plan such as the development of uniform instructions of safety related aspects for all sites and the development of an overarching accidents and incidents reporting system. The RI&E assessment also resulted in the establishment of safety teams per entity location to ensure follow up of the RI&E Action Plan. Lastly, in 2021 we intensied our focus on access restrictions to our sites as well as surveillance activities. Storage of dangerous goods With regards to the storage of ammable household liquids and different types of aerosols that form part our Beauty and Personal Care segments, we adhere to Seveso-III. This is the directive that applies to establishments in the European Union where dangerous substances are used or stored in large quantities and contributes to achieving a low frequency of major accidents. In distributing these goods, we adhere to The European Agreement concerning the International Carriage of Dangerous Goods by Road (ADR). We train our staff on a regular basis in conjunct with the re department. In 2021, our Seveso-III compliance was reconrmed after inspection performed by the environmental services. Safety and security in the workplace Material topic 5 Ambition: we aim to have zero accidents in the workplace and to promote safe employee behaviour in every location where we conduct business. We are highly committed to keeping our employees safe and secure and providing an environment that is free from discrimination, harassment and victimisation and in which everyone is treated equally. The safety of our employees is particularly important when it comes to working conditions in our warehouses, in operational activities and at our operations in higher risk areas (related to our activities in remote markets). On an ongoing basis, we provide employees with knowledge and tools aimed at recognising and eliminating injuries and illness at work and at home. In our warehouses this involves proactive hazard recognition, risk assessment, and risk control to prevent accidents and near misses. Employees are trained in equipment use to ensure both their safety as well as strict adherence to our processes related to food safety and customs compliance. Employees in higher risk regions and countries are extensively trained to perform in such environments with specialized training courses including safety, security, personal health and hygiene. 51 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Business ethics Material topic 3 Ambition: we aim to uphold ethical principles in the business relationships and activities by adhering to strict internal policies and guidelines to avoid corruption, bribery, fraud and other unethical behaviour. We earn credibility with our stakeholders by keeping our commitments, acting with honesty and integrity, and pursuing our company goals solely through ethical and professional business conduct. Know Your Relations (KYR) Strict Know Your Relations (KYR) procedures are in place for the acceptance of new customers, suppliers and other business relations. We have anti-bribery, anti-corruption and anti-money laundering (AML) policies in place that apply to all our staff. We expect our suppliers, customers and business partners to adhere to the same standards. Extensive knowledge of the substance and impact of the Foreign Corrupt Practices Act (FCPA) is embedded at every level of the Company and our anti-bribery and anti- corruption policy is embedded in our Code of conduct. Creditworthiness of new relations is checked upfront, and their Ultimate Benecial Owner(s) data is checked against the OFAC and the EU Sanctions list. Established relationships are monitored on compliance standards by an automated check that is performed on all business relations every two weeks. In 2021 we continued the implementation of digitally onboarding new business relations as well re-assessed all our existing supplier and client relations globally. As part of our regular automated compliance checks, one business relation was discontinued in 2021. Human rights Respecting human rights is a core part of our daily business, as we have many international operations and source and distribute our assortment globally. Our human rights procedures are rmly embedded in our Code of Conduct and all employees are expected to work in the spirit of these principles. These principles are based on the Universal Declaration of Human Rights and the International Labour Organisation (ILO). To highlight our commitment to the 10 universally accepted principles in the areas of human rights, labour rights, the environment and anti-corruption, we have been a member of the UN global compact (UNGC) since 2010. We actively propagate them to protect and maintain our integrity and reputation, regardless of the location of our operations. As an example, in some of the countries where we have operations, the human rights conditions deviate from those in Europe. We ensure that the same principles are adhered to in these operations as to those applicable in the Netherlands. We also assess human rights aspect in our supply chain. For example, our private label producers for Personal care items located in high risk countries, are required to be audited on a regular basis by BSCI/Amfori, SA8000 or Sedex/SMETA. Whistle-blower policy For our employees, we have a whistle-blower policy in place that offers the possibility to report suspected misconduct within the company. The policy can be found on our corporate website. In 2021, no material matters were reported. 52 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Cyber security & data protection Material topic 4 Ambition: we aim to set up and adhere to the right policies and control framework to keep business, customers and employees’ data safe. We safeguard critical business and personal information and respect personal information of our people and our customers as is required per the General Data Protection Regulation. We ensure that appropriate privacy and information security controls are in place, and take appropriate steps to protect it from loss, misuse or alteration by technical measures like rewalls, intrusion detection and prevention systems, and passwords and encryptions. Organisational measures are performed and enhanced on an ongoing basis and include training staff on cyber security, identifying data incidents and risks, and restricting staff access to personal information. In 2021, we changed security provider, enabling a 24/7 Managed Detection and Response (MDR) center. We continued the integration of acquired business entities onto our centralised security hub (this concerns companies that already had fully compliant systems in place at the time of acquisition) and further optimised the harmonisation of security policies across all entities. This maximises the implementation of the Zero Trust principle, for which we work together with an approved Microsoft security party. We also continued and expanded our cybersecurity awareness programme amongst employees with dedicated company-wide project updates and explanatory messaging. We focused on security awareness training that increases cybersecurity knowledge, motivates staff in reporting possible cybersecurity threats and supports behavioral change to reduce risk. In 2022, we plan to extend our GDPR specialty in our legal discipline in line with growing direct-to-consumer e-commerce activities. “B&S invests in responsible business practices, transparent reporting, and a culture of purpose.” Ken Lageveen, COO B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults 53 Sustainable operations UN GC Principle 7: Businesses should support a precautionary approach to environmental challenges; UN GC Principle 8: undertake initiatives to promote greater environmental responsibility; and UN GC Principle 9: encourage the development and diffusion of environmentally friendly technologies. ISO 14001, ISO 22000, ISO 9001 USAPHC approved AEOS & AEOC status MSC Ofcially registered supplier to UN Global Market place Certications & licenses Supporting UN Global Compact Principles “ We work in close cooperation with customs authorities to assure supply chain security.” 54 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Customs compliance Material topic 1 Ambition: we aim to ensure compliance with all relevant rules and regulations to uphold our relationship and status with customs authorities. As we are a vital part of the international supply chain and are involved in customs related operations, we adhere to a range of criteria that grants us the status of Authorised Economic Operator. This status allows us to work in close cooperation with customs authorities to assure the common objective of supply chain security based on the principles of mutual transparency, correctness, fairness and responsibility. We are subject to the Union Customs Code (UCC), the EU regulation that provides rules and procedures for products that are brought into or are taken out of the customs territory of the European Union. To ensure that our operations continuously meet all criteria for both customs simplication (AEOC) and security and safety (AEOS), our focus lies on complying with customs legislation and taxation rules, appropriate record keeping, nancial solvency, proven practical standards of competence and appropriate security and safety measures. Procedures and controls are implemented and monitored to ensure the compliance with laws and regulations. 55 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Innovative supply chain Material topic 8 Ambition: we aim to promote innovative technology to create new ways of conducting business. Digital transformation is marked as one of our key growth areas in our 2021 – 2023 strategic direction. One of our priorities is to further build our digital supply chain and to use innovative technology in our warehousing operations and throughout the organisation. We also prioritised data driven decision making in our operations, amongst others by gearing up our data science discipline at corporate level in 2021. Data driven services Identication of commercial priorities takes place in consultation with our suppliers and customers. As a result, we are upgrading current services with further roll out and optimisation of digitised ordering via our B2B and B2C platforms. In 2021 our focus on implementing our e-commerce strategy in all our business models was further enhanced. We successfully connected a selection of key customers with our multi-category B&S Nnity backbone, providing a fully digitised business ow and increasing cross selling opportunities by offering multiple assortments in one order platform. We continued to leverage our online B2C Beauty business to further develop our proposition towards end-consumers into new focus areas such as Liquors. This resulted in the launch of a multi country Liquor webshop in selected European countries, with further country expansion in 2022. At the same time, we added data driven services with new digital business models to our portfolio to serve wholesalers, resellers and consumers altogether. As an example, as part of our marketing solution proposition, we strengthened our in 2020 introduced services for (selected) brands all driven and optimised by data. By developing targeted campaigns for tailored audiences to increase (online) reach of established and up-and- coming brands, we added marketing and brand development to our offering, strengthened and established business partnerships with brand owners, and moved further towards the consumer. For more information on our data driven solutions, please refer to the About B&S section in this report. To make our operations future t we continued the centralisation of our buying and sales processes to generate data driven insights and tools between our segments and to digitise internal processes for integrated communication with our various stakeholders throughout the supply chain. With our Digital First approach we further integrated this into our daily operations throughout 2021 by means of the ongoing roll-out of our proprietary BiT ERP system in the segments within the company that were not yet connected. In addition, we continued our efforts in digitising and automating current business models by further integrating data analytics, reporting dashboards and business insights through Power BI and Project Portfolio Management (PPM). 56 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Food safety Material topic 9 Ambition: we aim to ensure a high-quality product and preventing health risks arising from use, consumption, handling, preparation and storage throughout the value chain. We adhere to the strictest food safety standards to ascertain the safety of the food supply chains we are active in. We actively promote transparency of product information and comply with the most stringent international regulations. Our food warehouse in Dordrecht is ISO 22000;2018 certied, and applies a high-level risk management system. This certication demonstrates to our stakeholders our dedication to complying with international food safety standards. In the Netherlands, we are subject to the supervision of the Netherlands Food and Consumer Product Safety Authority (NVWA), which is supervising our cold store almost on a daily basis and tests us by means of regular audits. Internal audits are carried out on a periodic basis by our QHSE department which reports directly to the Managing Director of the B&S Food segment as well as the CEO. Food products received at our warehouses are subject to comprehensive quality controls and are stored in climate-controlled environments. We are also approved by the US Army Public Health Command (USAPHC) for our food distribution to military operations, which enables us to supply US Army caterers. This is audited on an annual basis. Additionally, we are an ofcially registered supplier to the United Nations Global Marketplace (UNGM), the common procurement portal of the United Nations system of organisations. This enables us to participate in tender processes for United Nations contracts. In 2021, we invested in an improved and more sustainable cooling installation in our B&S Food segment which allows us to adhere up to high food safety standards we have. We implemented a modern CO 2 system which is mainly powered by our solar panels. We also managed to renew our ISO22000 and ISO9001 (Quality control) certications. In the year under review we encountered four recalls - all of which initiated by suppliers - and which have been dealt with adequately under supervision of the NVWA. Our quality control systems are designed in such a manner that product information – both quantities and its location stored - is readily available and swift actions regarding re-calls can be performed. 57 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Energy use Material topic 11 Ambition: we aim to implement energy saving /energy efcient ways of working and using energy responsibly in our premises and in the value chain. Our biggest direct energy impact lies within our warehouses, ofces and business travel. As such we strive to reduce the CO 2 footprint of our own operations as much as possible. To underline our commitment we are ISO 14001 certied at our facilities in Dordrecht in the Netherlands. The Dordrecht location is one of the largest and complex facilities of B&S. As such, it functions as an excellent starting point for implementing ISO14001 at our other facilities the coming years. In our day-to-day operations we focus on implementing energy efcient measurements and transitioning to the use of renewable energy sources. As an example, we use geothermal energy as a heating / cooling source, motion detection lightning to reduce energy consumption and roof insulation. In 2021, we executed energy audits at our Dutch locations to give us detailed insight on activities that have high energy consumption patterns as well as which suitable energy saving measures can be made in the coming years. Some of these saving measures we have already implemented in 2021. As an example, we reduced our environmental impact through the installation of nearly 35,000 m 2 of sustainable roong material Derbigum NT on our B&S Food and B&S Health segment headquarters. This results in a CO 2 reduction during the production process of more than 25,000 kg (an equivalent of more than 180,000 driven km). Also, we installed 8,400 solar panels on the roof of our B&S Food and B&S Health segment ofce and warehouse, generating 3,500,000 KwH per annum, sufcient to cover 85% of energy demand of this facility. The addition of this panel park to our already existing one, provides our operations with 3,930,000 KwH of electricity (from nearly 9,800 solar panels). From 2022 onwards, all our energy usage in the Netherlands will be derived from locally produced renewable sources. In addition, we replaced our largest cooling system in our Food operations by a more sustainable one that only uses natural refrigerants. These have a signicant lower global warming potential compared to the conventional refrigerants. Besides CO 2 reduction measures on premise, we launched ‘Project drop off’ in collaboration with our transport partners. The project focusses on realising cost savings as well as CO 2 emission reduction by transport via barge instead of road. We managed to reduce CO 2 emissions with an estimated 58,000 kg CO 2 . Also, we saw the effect of our revised lease eet policy which came into effect on 1 January 2021; 13% of our eet now consists of electric models. 58 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults In 2021, our CO 2 emissions as a result from electricity and gas consumption of our main ofces and warehouses were 5,225 ton CO 2 (5,257 : 2020)*. The realisation of various energy saving measures, consolidation of locations and the installation of our solar panels at the end of 2021 resulted in a reduction of our CO 2 emissions, however only slightly (32 ton, -0.6%). In 2021, colder weather especially during the rst months of the year resulted in more gas use to keep our buildings at certain temperatures and to ensure our sprinkling installations remained above 4 degrees. The coming years we will further expand our energy efciency measures and reporting efforts. This also includes gathering details of our scope 3 emissions derived from air travel and further disclosure on CO 2 emissions from our facilities other than our main ofces and warehouses. * Coverage >80% (in m 2 ) scope 1 (gas consumption) and scope 2 (electricity consumption) of ofces and warehouses that are under our direct operational control. “ We aim to establish a baseline of our various waste streams and recycling potential for 2022.” 59 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Waste management Material topic 12 Ambition: we aim to reduce waste and optimise opportunities for recovery, reuse or recycling of by-products, and disposing of waste appropriately. We contribute to the reduction of waste by amongst others separating various waste streams and by reducing, reusing and recycling packaging material in our warehouses. Our waste management approach has in the past been characterised by our decentralised operations, where initiatives to reduce waste were initiated and executed on (sub) segment level. In 2021, we started working with a new waste partner which enables us to gain an increased level of insights into the various waste streams and the subsequent recycling potential. We aim to establish a baseline of our various waste streams and recycling potential for 2022. This will facilitate us in further improving our waste management efforts and to move from ‘waste’ towards ‘resource’. Furthermore, we actively encourage our staff to recycle waste by providing separate waste containers on site in order to increase recycling of paper & cardboard and plastic foil. In addition, we prevented food waste by continuing our collaboration with local food banks to ensure that products that can no longer serve commercial purposes yet are still t for consumption are distributed to those in need. The automated packing process in our e-commerce operations was further optimised to have machines handle thinner, recycled and FSC certied cardboard. The secondary packaging in this operation now consists of 70-100% recycled material and carries an FSC Mix 70% label. In addition, we continued to further replace plastic box lling by paper material for our e-commerce deliveries to consumers. In our private label packaging for the Personal Care business, all our paper and cardboard packaging is made from FSC certied material. 60 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults In 2021, the EU Taxonomy was adopted by the European Commission. This classication system of environmentally sustainable economic activities aims to stimulate sustainable investments and spur the implementation of the European Green Deal. This means that for Full Year 2021 B&S is required to disclose information about the proportion of Taxonomy eligible and non-eligible economic activities in relation to their total turnover, capital and operational expenditure. For Full Year 2021, only the environmental objectives ‘climate change mitigation’ and ‘climate change adaptation’ are applicable. B&S connects various parties in the value chain by means of technology to make premium consumer goods available to everyone, anywhere. To assess whether our key economic activities are eligible or not, we performed an analysis of the extent to which our key economic activities are currently included under the two adopted environmental objectives. We used the EU Taxonomy Compass as well as the EU Taxonomy Technical Annex Report as guidance documents to ensure our analysis was performed in alignment with regulatory requirements under the EU Taxonomy. Based on this analysis, our key economic activities are non-eligible as per EU Taxonomy objectives ‘climate change mitigation’ and ‘climate change adaptation’. The outcome of this exercise is summarised in the below table. ELIGIBLE AND NON-ELIGIBLE KEY ECONOMIC ACTIVITIES Key economic activities Turnover CAPEX OPEX Eligible 0% 0% 0% Non-eligible 100% 100% 100% Total 100% 100% 100% Note on EU Taxonomy We would like to emphasise that the above does not provide any information of B&S’ sustainability efforts and results. For an overview of our sustainability ambitions, activities undertaken, and progress made in 2021, please refer to the Results and Governance sections in this report. Outlook for Full Year 2022 The EU taxonomy will take further form the coming year(s) in both its scope and respective reporting obligations. In 2022 it is expected that the other four objectives will also be adopted by the European Commission. In addition, key economic activities under the currently already adopted environmental objectives might be extended. Naturally, B&S will closely monitor the developments regarding the EU Taxonomy as well as the Corporate Sustainability Reporting Directive (CSRD) and will adjust its reporting accordingly to ensure compliance with regulatory reporting requirements. 61 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults In the second half of 2021, B&S appointed a dedicated sustainability manager at corporate level to assist the Executive Board & Leadership team in updating our sustainability strategy, policies and programmes whilst considering stakeholder requirements and recent reporting developments. Sustainability ambition underlining our commitment The roadmap for executing this update was put in place end 2021 in order to enable a structured implementation of our sustainability ambitions by our various segments and entities across the world. It includes the below mentioned elements. 1 Execution of double materiality assessment to assess which key sustainability matters are most relevant to our stakeholders and our enterprise value. This provides the backbone for our revised sustainability strategy 2 Performing environmental, social and governance risk assessments which will enable us to develop sound due diligence practices to prevent and mitigate sustainability risks 3 Updating policies and commitments linked to our key sustainability matters by dening our beliefs & principles, way of working, ambition and quantied targets 4 Determining key performance indicators and establishing data management systems including setting clear cut denitions and a sustainability control framework to ensure accurate and complete reporting on progress made 5 Renement of sustainability programmes providing an overview of actions, timelines and roles & responsibilities per segment and corporate functions. These plans for action will assist in a phased role out of our sustainability ambitions across the world the coming years 6 Reporting our efforts by means of an internal management dashboard as well as via our website and annual report to provide transparency to our stakeholders Based on these elements, B&S aims to present the framework of its revised sustainability strategy with its Half Year 2022 results publication. Read the story B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults 62 business story Delivered solutions: Warehousing, Distribution, Digital commerce When it comes to health, you can’t take any chances. That’s why we provide solutions for any challenge. Supply for any demand. Including medicines that are difcult or nearly impossible to obtain. Why healthcare professionals rely on B&S to provide the best care to their patients “We focus on sustainable and protable growth, creating long-term value for our stakeholders.” Peter Kruithof, CFO B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults 63 Organic turnover growth (0.3%) Acquisitive turnover growth 0.7% EBITDA margin 6.2% Return On Invested Working Capital 24.8% Net debt / EBITDA 2.5 Commercial focus / Financial performance Financial performance 64 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Financial performance Non-IFRS nancial measures The table below presents an explanation on non-IFRS nancial measures used. These measures are not recognised measures of nancial performance, nancial condition or liquidity under IFRS. We present these non-IFRS nancial measures because we consider them an important supplemental measure of our performance and believe that they and similar measures are widely used in the industry in which we operate as a means of evaluating a company's operating performance, nancial condition and liquidity. The measures are used by management to monitor the underlying performance of our business and operations. Gross prot margin Gross prot margin is dened as realized turnover minus purchase value of items sold EBITDA EBITDA is dened as earnings before interest, taxes, depreciation and amortisation EBITDA margin EBITDA Margin is dened as EBITDA as a percentage of turnover Inventory in days Inventory in days is dened as inventory as per period end divided by the Last Twelve Months (LTM) purchase value times 365 Solvency Solvency is dened as group equity as a percentage of total assets Working capital Working capital is dened as Inventory plus Trade receivables minus Trade payables Net debt Net debt is dened as interest bearing liabilities minus cash and cash equivalents ROIWC Return on invested working capital dened as the LTM EBITDA divided by Working Capital Prot or loss performance € million (unless otherwise indicated) FY 2021 reported FY 2020 reported Δ (%) reported Prot or loss account Turnover 1,869.5 1,861.8 0.4% Gross prot (margin) 287.3 15.4% 254.9 13.7% 12.7% EBITDA (margin) 116.4 6.2% 90.3 4.9% 28.9% Depreciation & amortisation 30.7 32.5 (5.4%) Impairment of non-current assets 10.2 - Prot before tax 71.7 51.2 40.0% Net prot 54.6 40.6 34.5% EPS (in euro) 0.46 0.26 76.9% ROIWC 24.8% 22.5% Financial position Inventory in days 88.1 70.0 Working capital 470.1 401.4 Solvency ratio 35.4% 38.0% Net debt 294.7 252.5 Net debt/EBITDA 2.5 2.8 65 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Turnover The 2021 turnover levels equaled 2020 levels, with turnover increase still halted by Covid-19 developments. Organically, turnover declined by 0.3%, driven by continued travel restrictions and lockdowns due to the global pandemic, having ongoing impact on our hospitality and travel related business. Acquired turnover contributed 0.7%, stemming from Top Care in the B&S Beauty segment. € million (unless otherwise indicated) FY 2021 reported FY 2020 reported * Δ (%) reported B&S Liquors 540.9 575.5 (6.0%) B&S Beauty 675.7 646.1 4.6% B&S Personal Care 276.4 262.6 5.3% B&S Food 287.2 277.9 3.3% B&S Health 46.7 55.2 (15.4%) B&S Retail 42.5 44.5 (4.5%) Holding & eliminations 0.1 Total turnover 1,869.5 1,861.8 0.4% * The comparative information has been re-presented due to the new segment structure as per 2021. Turnover split per segment B&S Liquors Over the year, turnover continued to be negatively impacted by product scarcity in the market and supply chain challenges, as well as continued focus on higher margin business at the expense of turnover. B&S Beauty Turnover increased as a result of geographical expansion and continued growth in online sales. Continued industry-wide product scarcity held back further growth. The EUR/USD exchange rate impacted reported sales levels in B2C although these effects partially reversed in Q4. B&S Personal Care Turnover increased as a result of sales growth to key customers and growth of private label assortment, both aided by the lifting of Covid-19 restrictions. B&S Food Sales grew compared to last year, driven by domestic business and outperformance of sales in the Middle East. This was counterbalanced to a large extent by the remote business. Turnover in this business line declined following withdrawal of troops from Afghanistan which was largely in line with expectations, yet the abrupt ending of all military related business in Afghanistan led to an even faster decline in H2. B&S Health Driven by product scarcity related to the pandemic, the decline of Covid-19 related sales when compared to 2020 and the slow recovery of the travel vaccine market, turnover decreased signicantly. B&S Retail With travel restrictions gradually being lifter throughout the year, turnover increased as a result of higher passenger numbers and higher spend per passenger. In Q4, sales more than doubled when compared to Q4 last year. 66 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Gross prot Gross prot amounted to € 287.3 million (2020: € 254.9 million). As a percentage of turnover, margins increased from 13.7% to 15.4%. This was mainly the outcome of focus on higher margin business in the Liquor category as well as the traditionally higher margins of our e-commerce business that saw increased contribution to the overall business mix. Operating expenses Operating expenses increased from € 164.5 million to € 170.9 million. The increase of € 6.4 million is mainly the outcome of increased IT costs predominantly driven by investments in e-commerce and further harmonisation of our centralised ERP system as well as increased marketing costs driven by expanded Direct-to-consumer business. EBITDA As a result of the gross margin increase signicantly outweighing the increase of the cost base, EBITDA increased 28.9% to € 116.4 million (FY 2020: € 90.3 million), therewith exceeding 2019 levels. EBITDA margin increased to 6.2% (FY 2020: 4.9%), therewith exceeding the 6.0% target for FY 2021. Group result for the year Depreciation of tangible xed assets and amortisation of intangible xed assets amounted to € 30.7 million (2020: € 32.5 million). Additionally, an impairment loss related to the food segment of € 10.2 million is accounted for. Although we have taken our measures within this segment and as such we foresee positive developments, we also considered less likely yet less positive scenarios. With the goodwill impairment test (as per IAS36) for the B&S Food Segment it became apparent that although the base case scenario didn’t require an impairment, the less positive scenarios had a different outcome. Financial expenses decreased to € 3.9 million (2020: € 7.0 million) as a result of decreased lending rates and less outstanding debt following reduced average working capital levels. This resulted in prot before tax of € 71.7 million (2020: € 51.2 million). The effective tax rate stood at 23.9% compared to 20.6% FY 2020 following increased prots in high tax jurisdictions. As a result, net prot from continuing operations amounted to € 54.6 million (2020: € 40.6 million). Net prot attributable to non-controlling interests amounted to € 16.1 million (2020: € 18.9 million). The decrease is mainly the result of acquiring additional shares in JTG and as such indirectly FragranceNet.com as of June 30, 2021. Net prot attributable to the owners of the Company amounted to € 38.5 million (2020: € 21.7 million). “EBITDA and EBITDA margin increased signicantly as a result of enhanced commercial focus in selected higher margin areas.” Arben Hajrullahu Managing Director B&S Liquors 67 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Segmental performance B&S Liquors € million (unless stated otherwise) FY 2021 reported FY 2020 reported Δ (%) reported Turnover 540.9 575.5 (6.0%) Gross prot 56.9 36.6 55.5% EBITDA 28.2 12.9 118.6% EBITDA margin 5.2% 2.2% B&S Liquors saw sales decline by 6.0% while gross prot increased by 55.5% compared to FY 2020. EBITDA and EBITDA margin increased signicantly as a result of enhanced commercial focus in selected higher margin areas and channels that can be served at similar staff costs. Our European Liquor wholesale continued to see impact of the forced closures of bars and restaurants, yet our focus on selected EU countries reaped results in the second half of the year. Additionally, the launch of our B2C webshop that was rolled out across several European countries in the second half of 2022 started to contribute to results. Our international Liquor distribution was still impacted by the pandemic with industry wide scarcity and container shortages that continued throughout the year. As a result, turnover levels were signicantly below 2020 levels. However, our focus on higher margin business as well as product scarcity led to signicant gross prot increase. 68 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults B&S Beauty € million (unless stated otherwise) FY 2021 reported FY 2020 reported Δ (%) reported Turnover 675.7 646.1 4.6% Gross prot 126.7 115.6 9.6% EBITDA 62.4 65.4 (4.6%) EBITDA margin 9.2% 10.1% “Online B2C continued growth, driven by international geographical expansion.” Willem Tuk Managing Director B&S Beauty B&S Beauty increased turnover and margin, yet saw a slight decline in EBITDA and EBITDA margin due to staff cost increase following the expansion of the online B2C business. Q4 turnover was slightly behind on Q4 2020 following scarcity in the market. B2B and B2R sales were impacted by product scarcity, yet partly counterbalanced by new business models. Both developments positively inuenced gross prot margins in this business. Online B2C continued growth, driven by international geographical expansion. The EUR/USD exchange rate impacted sales levels in B2C although these effects partially reversed in Q4. Further turnover growth was held back by product scarcity driven by the pandemic. As expected, in the second half of 2021 margins for this business were back at pre-covid levels. “Performance was driven by increased sales to key clients, partly following the lifting of Covid-19 restrictions in several European countries.” Bert Boersema Managing Director B&S Personal Care 69 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults B&S Personal Care € million (unless stated otherwise) FY 2021 reported FY 2020 reported Δ (%) reported Turnover 276.4 262.6 5.3% Gross prot 46.3 44.3 4.5% EBITDA 25.3 22.7 11.5% EBITDA margin 9.1% 8.6% Despite supply chain complexities driven by the pandemic, B&S Personal Care increased sales by 5.3% while gross prot increased by 4.5% compared to FY 2020. EBITDA margin increased as well. This performance was driven by increased sales to key clients, partly following the lifting of Covid-19 restrictions in several European countries. Further sales growth in 2021 was held back by high container prices which put pressure on availability and prices of the private label assortment. “2021 saw an altered business mix, with less contribution of remote markets which come at higher margins.” Maurice Riegel Managing Director B&S Food 70 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults B&S Food € million (unless stated otherwise) FY 2021 reported FY 2020 reported Δ (%) reported Turnover 287.2 277.9 3.3% Gross prot 36.2 37.6 (3.7%) EBITDA 3.1 3.9 (20.5%) EBITDA margin 1.1% 1.4% B&S Food increased sales with 3.3% while gross prot was largely in line with 2020 levels. This is the result of an altered business mix, with less contribution of remote markets which come at higher margins. EBITDA margin stood at 1.1%. Q4 sales were well above last years levels driven by brand distribution activities. The Government & Defence business saw turnover and gross prot decrease from Q1 onwards as a result of the withdrawal of troops from Afghanistan. Although the business decline for 2021 was largely anticipated, the abrupt ending of all military related business in Afghanistan in Q3 led to sharper turnover decline and higher wind down cost in H2 than originally projected. Our brand distribution services performed in line with expectations on turnover, yet slightly underperformed on gross prot due to a number of new sizeable deals at the expense of gross prot margin. Duty-free and travel related markets still saw the impact of Covid-19 restrictions on sales. The domestic markets on the other hand slightly increased turnover especially in the last quarter, albeit at slightly lower margins. “Due to Covid-19, the travel vaccines business in 2021 recovered only slowly, and delayed care treatments reduced the demand for hospital supplies.” Rogier van Duin Managing Director B&S Health 71 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults B&S Health € million (unless stated otherwise) FY 2021 reported FY 2020 reported Δ (%) reported Turnover 46.7 55.2 (15.4%) Gross prot 7.9 10.3 (23.3%) EBITDA 1.9 4.7 (59.6%) EBITDA margin 4.1% 8.5% B&S Health saw sales decline by 15.4%, with a margin decrease of 23.3%. EBITDA margin signicantly decreased as a result of the xed cost base. The rst nine months of 2020 benetted from Covid-19 related sales whereas the travel vaccines business in 2021 recovered only slowly, and delayed care treatments resulted in reduced demand for hospital supplies. Sales in Q4 were in line with the same quarter last year and driven by export business. “EBITDA increased by 87.5% with positive EBITDA number in the second half of the year.” Guus Jonge Poerink Managing Director B&S Retail 72 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults B&S Retail € million (unless stated otherwise) FY 2021 reported FY 2020 reported Δ (%) reported Turnover 42.5 44.5 (4.5%) Gross prot 11.8 8.5 38.8% EBITDA (1.5) (12.0) 87.5% EBITDA margin (3.5%) (27.0%) B&S retail managed to realise turnover levels largely in line with last year, and - despite another round of temporary store closures at the end of Q4 - more than doubled its sales in the last quarter of 2021 when compared to Q4 last year. Gross prot increased and although break-even was not reached – as expected and communicated – EBITDA increased by 87.5% with positive EBITDA number in the second half of the year. Virtually all shops were reopened by the end of 2021, and recovery towards the end of the year was aided by either slightly higher than expected passenger numbers or higher spend per passenger. 73 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Balance sheet € million (unless stated otherwise) 31.12.2021 31.12.2020 Change Intangible xed assets 119.1 122.6 (3.5) Tangible xed assets 38.1 37.3 0.8 Right-of-use assets 60.7 66.1 (5.4) Financial xed assets 6.3 5.5 0.8 Non-current assets 224.2 231.5 (7.3) Inventory 381.8 308.3 73.5 Trade receivables 195.0 195.6 (0.6) Other current assets 44.2 33.2 11 Cash and cash equivalents 12.5 38.9 (26.4) Current assets 633.5 576.0 57.5 Total assets 857.7 807.5 50.2 Equity 303.3 306.9 (3.6) Non-current liabilities 291.7 162.1 129.6 Current liabilities 262.7 338.5 (75.8) Total equity and liabilities 857.7 807.5 50.2 Non-current assets Non-current assets decreased to € 224.2 million at year-end 2021, compared to € 231.5 million at the end of 2020. The decrease is mainly the result of the impairment of € 10.2 million at the B&S Food Segment. Investments mainly related to replacement capex and the further investment in our B&S Nnity platform. Current assets Current assets stood at € 633.5 million at year-end 2021, compared to € 576.0 million at year-end 2020. The main increase in our current assets relate to an increased inventory position. In 2020 with limited visibility on the market developments as a result of Covid-19 we minimalised the inow of inventory. In order to be able to meet forecasted demand in Q1 2022 and with the current scarcity in the market we increased our inventory positions. The number of inventory days as such increased from 70 days in 2020 to 88 in 2021. Trade receivables remained stable following our strict measures and credit management procedures. Net working capital increased to € 470.1 million at year-end 2021, compared to € 401.4 million at year-end 2020, as a result of the increased inventory position. Working capital in days increased from 85 days in 2020 to 101 days in 2020. 74 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Group equity The Group’s equity slightly decreased to € 303.3 million at year-end 2021, compared to € 306.9 million at the end of 2020. During 2021, the Group paid € 8.5 million dividend to owners of the company (2020 no dividend) and paid € 11.9 million dividend to non-controlling interests (2020: € 13.3 million). Group equity was further impacted for an amount of € 49.4 million as a result of the acquisition of the J.T.G. Holding B.V. and J.T.G. W.W.L. S.à r.l. shares and the following conversion of the remaining 8.21% shares in this company towards B&S Beauty B.V. shares. Non-current liabilities Non-current liabilities stood at € 291.7 million at the end of 2021, compared to € 162.1 million at year-end 2020. The increase of the non-current liabilities mainly is the result of the renancing of the bank debt of the group. Where B&S previously was mainly funded by working capital facilities with the renancing of the debt at the end of 2021 the company attracted long term funding to secure its nancial position. At the end of 2020 non-current loans and borrowings amounted to € 49.5 million compared to € 181.0 million as per year-end 2021. Current liabilities Current liabilities decreased to € 262.7 million at year-end 2021, compared to € 338.5 million at the end of 2020, mainly the result of the indicated renancing of bank debt. Included in the current liabilities as per year end 2021 is an amount of € 38.5 million relating to the acquisition of the J.T.G. Holding B.V. shares payable in January 2022. Financing B&S was mainly nanced through short-term working capital credit facilities. At December 30, 2021 B&S Group renanced all its main credit facilities. B&S attracted a combination of unsecured bank loans and unsecured revolving credit facilities both on a committed and an uncommitted basis. Reference is also made to note 23 of this annual report. Net debt (on a post IFRS 16 basis) increased from € 252.5 million as per year-end 2020 to € 294.7 million as per year-end 2021. Net debt / EBITDA ratio stood at 2.5 (FY 2020: 2.8). Cash ow € million (unless stated otherwise) 2021 2020 Net cash from operations 14.8 147.0 Net cash from investing activities (23.8) (15.2) Net cash from nancing activities (17.3) (143.8) (26.3) (12.0) As a result of our inventory build-up towards year end, net cash from operations decreased from € 147.0 million in 2020 to € 14.8 million in 2021. Investing activities mainly related to replacement capex, investments in our B&S Nfnity backbone and the investment in additional shares in J.T.G. Holding B.V. Financing activities mainly related the renancing of the B&S Group bank debt towards the end of 2021 and dividend payments to both the shareholders of B&S Group and the minority shareholders. 75 B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults Divided proposal At the Annual General Meeting to be held on May 17, 2022, B&S will propose the payment of € 0.18 per share, in cash (subject to withholding tax if applicable). This translates into a pay-out ratio of 40% of the annual Group results attributable to the owners of the Company. Outlook For 2022, uncertainties related to the prolonged pandemic are projected to remain, and we expect demand for digital supply chain solutions to develop further. B&S plans to expand its B&S Nnity backbone and continue its focus on improved operational efciency by accelerating innovations. We strive to expand sales with marketing and brand development solutions and plan to launch new direct-to-consumer business models in various geographies. Overall, we focus on the product-market-channel combinations where we foresee growth, both in B2B and B2C and in all product categories, supported by our digitised services and e-com solutions. We strive to achieve 7.5% organic topline growth in 2022 and will continue efforts to further enhance protability with ongoing focus on higher margin business combined with cost control measures and operational efciency. To maintain our healthy nancial position, we remain focused on return on invested working capital in every operating segment and in particular Days of sales outstanding and aging of inventories. Read the story B&S Group S.A. Annual Report 2021 Introduction About B&S Governance Financial statementsResults 76 business story Delivered solutions: Distribution, Marketing, Brand development As King of Reach, we specialise in complex challenges in complex markets. Thanks to our scale and global presence, we can ship any product, in any quantity, to almost anywhere in the world. Our partnership with Nestlé Waters to grow sales of the Perrier brand in the Caribbean put our capabilities to the test. Resources and resourcefulness: the story of Perrier’s target-breaking growth in the Caribbean Cherish home B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statements 77 Governance Corporate Governance is an integral part of how B&S chooses to do business. The desire to pursue best practices is embedded in our corporate philosophy and policies. Governance Composition of the Executive Board B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance 78 Tako de Haan, M (1960) Position: CEO and member of the Executive Board since 2020. In his role as CEO he holds responsibility for corporate strategy, IT, business development, marketing and human resources. End of current term: 2024 Nationality: Dutch Previous positions held: over 25 years of experience in senior operations and managerial roles (mostly in capacity of COO) at renowned brands such as Triumph and Nike. Peter Kruithof, M (1981) Position: CFO and member of the Executive Board since 2020. In his role as CFO he holds responsibility for nance, tax, internal audit, treasury and risk management. End of current term: 2024 Nationality: Dutch Previous positions held: joined one of the B&S segments in 2008 as nance director. In this capacity he served as member of the Management Board before becoming the Company’s Corporate Treasurer in 2016. Bas Schreuders, M (1954) Position: Member of the Executive Board since 2012 (re-appointed in 2020) and Senior Counsel. In his role as member of the Executive Board he holds responsibility for legal affairs. End of current term: 2024 Nationality: Dutch Other position: board member at Samson & Surrey Holdings Luxembourg S.à r.l. Previous positions held: CEO of Intertrust Group until 2010, several senior legal positions at various banks. Niels Groen, M (1987) Position: Member of the Executive Board since 2017 (re-appointed in 2020) and Managing Director. In his role as member of the Executive Board he supports the CFO in the responsibility for nance and risk management. End of current term: 2024 Nationality: Dutch Previous positions held: Started at B&S in 2011, held several senior nance positions before becoming Managing Director in 2020 for the Dubai operation of the Company. Leadership Team The Leadership Team of B&S supports the Executive Board in day-to-day decision making. This team consists of the non-statutory C-level functions and segmental Managing Director functions. Arben Hajrullahu, M (1974) Chief Commercial Ofcer and Managing Director B&S Liquors Bert Boersema, M (1971) Managing Director B&S Personal Care Guus Jonge Poerink, M (1977) Managing Director B&S Retail Willem Tuk, M (1969) Managing Director B&S Beauty Rogier van Duin M (1972) Managing Director B&S Health Ken Lageveen, M (1977) Chief Operations Ofcer Maurice Riegel, M (1978) Managing Director B&S Food B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance 79 Mr. Willem Blijdorp, through Sarabel Invest S.à. r.l. (‘Sarabel’), at year-end 2021 held 67.26% of the shares in B&S Group S.A. Mr Leendert Blijdorp at year-end 2021 held 0.01% of the shares in B&S Group S.A.. The other Supervisory Board members do not hold any ordinary shares or rigts to obtain ordinary shares. B&S values good governance and is committed to compliance with the principles of Supervisory Board composition as laid down in the Dutch Corporate Governance Code. B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance 80 Composition of the Supervisory Board Jan Arie van Barneveld, M (1950), Chairman First Appointed: 2018, end of current term: 2022 Nationality: Dutch Audit and Risk Committee (member), Selection, Appointment and Remuneration Committee (member) Last position held: CEO of Brunel International N.V. until May 2018 Supervisory Board memberships and other positions: member of the Supervisory Board of Brunel International N.V., member of the Advisory Board of Boels Topholding B.V., member of the Supervisory Board of NCOI. Willem Blijdorp, M (1952), Vice-Chairman First Appointed: 2004, end of current term: 2022 Nationality: Dutch Selection, Appointment and Remuneration Committee (member) Last position held: Founder of Kamstra Shipstores – which currently forms part of the B&S Liquors segment - and CEO of B&S until 2004, member of the Supervisory Board since 2004 Other positions: chairman of the Board of Directors of Clinuvel Pharmaceuticals. Rob Cornelisse, M (1958) First Appointed: 2018, end of current term: 2024 Nationality: Dutch Last position held: Tax partner at Loyens & Loeff N.V until 2018 Other positions: Professor of Tax Law at the University of Amsterdam and serves as of counsel at Loyens & Loeff N.V. B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance 81 Kitty Koelemeijer, F (1963) First Appointed: 2018, end of current term: 2025 Nationality: Dutch Selection, Appointment and Remuneration Committee (chair) Position: Full Professor of Marketing & Retailing and Director Center of Marketing & Supply Chain Management at Nyenrode Business University. Supervisory Board memberships and other positions: member of the Supervisory Board and chairman of the Audit Committee of Brunel International N.V., vice-chair of the Supervisory Board and chairman of the Remuneration Committee of Intergamma Coöp U.A., member of the Supervisory Board of CB Logistics, Vereniging Eigen Huis, NLinBusiness, and Handicapped Sports Fund, Board Member at VNPF. Leendert Blijdorp, M (1988) First Appointed: 2021, end of current term: 2025 Nationality: Dutch Audit & Risk committee (chair) Position: several board and committee member positions in companies related to Sarabel Invest S.à r.l. 82 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Executive Board The Executive Board is responsible for day-to-day management, strategy and advocacy of general stakeholders’ interest. The Executive Board may perform all acts necessary or useful for achieving the Company’s corporate purposes, except for those expressly attributed to the General Meeting or Supervisory Board under Luxembourg legislation or the Articles of Association. Composition, appointment and dismissal The Articles of Association provide that the Executive Board must consist of at least two members. In the period under review, the Executive Board consisted of four members. The composition of the Executive Board and information about its members is provided on page 78 of this Annual Report. Members of the Executive Board are appointed for a maximum period of four years and may then be reappointed for an unlimited amount of times, each time for a maximum of four years. Corporate Governance A member of the Executive Board may be removed or replaced with or without cause, at any time, by a resolution adopted by the Supervisory Board or by the General Meeting of Shareholders. No member can simultaneously be a member of the Executive Board and of the Supervisory Board. However, in the event of any vacancy at the Executive Board, the Supervisory Board may appoint one of its members to act on the Executive Board until the following General Meeting. During that period, the duties of this person within the Supervisory Board will be suspended. Meetings and decision-making In the nancial year under review, the Executive Board had 21 formal meetings. The majority was held by teleconference as a result of COVID-19 related measures. The functioning of and decision-making within the Executive Board are governed by the Executive Board Rules which can be found on the corporate website. According to the Executive Board Rules, the Company has installed an IT steering committee that assists the Executive Board in its oversight of the Company’s IT function and prepares recommendations for the Company’s IT policy. B&S was incorporated on December 13, 2007 as a private limited liability company (S.à. r.l.), under the laws of the Grand Duchy of Luxembourg. In March 2018, the Company was converted into a public limited liability company (S.A.). The Executive Board and Supervisory Board are responsible for the Company’s corporate governance structure. The corporate governance of B&S is determined by Luxembourg Law, the Articles of Association and – as these are underwritten by the Company - by the regulations of the Dutch Corporate Governance Code (the ‘Code’). 83 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Supervisory Board The Supervisory Board is responsible for supervising and providing advice on the policy of the Executive Board. The Supervisory Board regularly discusses the strategy, the implementation of the strategy and the principal risks associated with it. The Supervisory Board includes an account of its involvement in the establishment of the strategy, and how it monitors its implementation in its report, which can be found under ‘Report of the Supervisory Board’. Composition, appointment and dismissal The Articles of Association provide that the Supervisory Board must consist of at least three members. In the period under review, the Supervisory Board consisted of ve members. The composition of the Supervisory Board and information about its members is provided on page 80 of this Annual Report. Members of the Supervisory Board are appointed for a maximum period of four years and may then be reappointed for a maximum period of four years. A Supervisory Board member may then subsequently be reappointed for a period of two years. This reappointment may be extended by a maximum of two years. For reappointment after an eight-year period, reasons must be provided in the report of the Supervisory Board. A member of the Supervisory Board may be removed or replaced with or without cause, at any time, by a resolution adopted by the General Meeting of Shareholders. In the event of one or more vacancies in the Supervisory Board, because of death, resignation or otherwise, the remaining members of the Supervisory Board may appoint one or more members of the Supervisory Board, as the case may be, to temporarily ll any such vacancy until the next General Meeting of Shareholders where a new member of the Supervisory Board will be appointed upon proposal by the Supervisory Board, subject to compliance with any applicable nomination rights as set out in the Articles of Association. Meetings and decision-making The Supervisory Board shall meet at least 4 times a year and as often as the business and interests of the Company require. Unless the Chairman decides otherwise, Supervisory Board meetings shall be attended by all members of the Executive Board. In accordance with the Articles of Association, the functioning of and decision-making within the Supervisory Board are governed by the Supervisory Board Rules that can be found on the corporate website. The Supervisory Board can only validly adopt resolutions if at least two of its members are present or represented at a meeting duly convened in accordance with the Articles of Association and Luxembourg Law. Resolutions of the Supervisory Board may also be adopted outside of a meeting, provided that such resolutions are adopted in writing and signed by each member of the Supervisory Board. Pursuant to the Articles of Association, certain specied resolutions of the Supervisory Board require the afrmative vote of majority shareholder Sarabel Invest S.à. r.l. (‘Sarabel’), as long as it holds at least 30% of the ordinary shares. Committees The Supervisory Board has established two committees from among its members; the Audit and Risk Committee and the Selection, Appointment and Remuneration Committee. Their task is to assist and advice the Supervisory Board in fullling its responsibilities. These committees are governed by charters that have been drawn up in line with the Dutch Corporate Governance Code and can be found on the corporate website. The present composition of the committees are provided in this Annual Report under ‘Report of the Supervisory Board’. 84 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Remuneration The remuneration of the Supervisory Board members is determined by the General Meeting of Shareholders. The General Meeting may grant a xed remuneration to members of the Supervisory Board which is not dependent on the results of the Company and may grant an additional xed remuneration to the Chairman and the vice-chairman. The remuneration of the Supervisory Board members should reect the time spent and the responsibilities of their role. Diversity In the composition of the Boards, B&S strives for sufcient complementarity, pluralism and diversity with regard to age, gender and background. The main aim is to create a diverse mix of knowledge, skills, expertise and personal characters. The Company views diversity as a relevant mix of required elements that evolves with time, based on business objectives and future needs of the Company. We treat diversity of the Boards as means for improvement and development rather than as an objective in itself. In the selection of our new Supervisory Board member L. Blijdorp (appointed May 2021), the Supervisory Board took into account these views and focused on selecting a candidate with clear and distinctive expertise, contributing to pluralism in age, a focus on long-term value creation commitment towards B&S, and adding a personal character to the Board that balances but also challenges the Audit and Risk Committee and Supervisory Board composition. Board conicts of interest Conicts of interest should be handled in accordance with Art. 28 of the Articles of Association. If a member of the Executive Board or the Supervisory Board has a direct or indirect nancial interest opposite to the interest of the Company in any transaction that requires approval from the Executive Board or the Supervisory Board, he or she should inform the Boards as per Art. 28.1 of the Articles of Association. The member may not take part in the deliberations relating to the transaction and may not vote on transaction related resolutions. For details on transactions, reference is made to note 32 of the nancial statements in this report. Transactions were compliant with arm’s length principles. Herewith, the Dutch Corporate Governance Code best practice provisions regarding (reporting of) conict of interests have been complied with. General Meeting of Shareholders At least once a year, the Company convenes a shareholder meeting. The Executive Board and Supervisory Board ensure that the General Meeting of Shareholders is properly informed and advised. The Company has, in accordance with best practice provision 4.2.2 of the Code, drawn up a Policy on bilateral contacts. Shareholders who individually or jointly hold at least 5% of the issued share capital have the right to place items on the agenda and submit proposals for items included in the agenda. The Company will include the item on the agenda if it receives the substantiated proposal in writing clearly stating the item to be discussed, or a draft resolution, in writing at least 22 days prior to the meeting date. The main powers of the General Meeting relate to: the composition, appointment and dismissal of members of the Executive Board and the Supervisory Board; approval of the remuneration policy of the Executive Board and the Supervisory Board; the adoption of the annual nancial statements and declaration of dividends on Ordinary shares; discharge from liability of the members of the Executive Board and the Supervisory Board; 85 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Furthermore, the Articles of Association require the afrmative vote of the current majority shareholder Sarabel in respect of reinforced approval matters of the Supervisory Board as long as he holds at least 30% of the ordinary shares. There are no specic powers for the Executive Board and Supervisory Board to issue or buy back ordinary shares. Preference shares For a period of ve years, starting March 22, 2018 the Executive Board, as per Article 6 of the Articles of Association, is authorised to issue preference shares to a foundation (Stichting Continuïteit B&S Company) up to a total number of voting rights, after the issue, of 33.33%. The object of the foundation is limited to the protection of the interests of (i) the Company, (ii) the business connected therewith and (iii) all involved stakeholders. Contravening inuence threatening the continuity, the independence or the identity shall be averted as much as possible. The Executive Board may only issue preference shares with the prior written consent of the current majority shareholder Sarabel as long as he holds at least 30% of the ordinary shares. In 2021, no preference shares were issued. Share transactions by management The chart of transactions by persons discharging managerial responsibilities (PDMR), which are members of the Executive Board and Supervisory Board of B&S Company S.A., is available on our corporate website. This overview contains any signicant direct and indirect shareholdings within the meaning of the Transparency Directive. any transaction or measure entailing an important change of the identity or character of the Company; the issuance of ordinary instruments under the Ordinary Shares Authorised Capital in the excess of 10% maximum set out in Art. 6.3(i) in the Articles of Association; amendments to the Articles of Association in accordance with Art. 12.3 in the Articles of Association. For more information about the powers of the General Meeting, the Policy on bilateral contacts as well as Articles of Association, please visit our corporate website. Share capital The authorised share capital of the Company consists of one single category of shares: ordinary shares. All issued shares are fully paid up and each share confers the right to cast a single vote in the General Meeting. At year-end 2021, the total number of issued ordinary shares was 84,177,321. The ordinary shares are freely transferable at the stock exchange of Euronext Amsterdam. Share ownership rights There are no special control rights or restrictions on voting rights attached to the ordinary shares. However, shareholder Sarabel Invest S.à. r.l. (‘Sarabel’) has a right to nominate candidates for appointment as members of the Supervisory Board. Pursuant to Luxembourg law, if Sarabel, when making use of this nomination right, includes at least two candidates for each position in the proposal for appointment to the Supervisory Board, the General Meeting has to appoint one of the proposed candidates. 86 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Major shareholdings The Dutch Financial Supervision Act and the Luxembourg Transparency law require investors who hold a share interest or voting interest exceeding (or falling below) certain thresholds to (inter alia) notify their interest with the Authority for the Financial Markets (AFM) in the Netherlands and the Commission de Surveillance du Secteur Financier (CSSF) in Luxembourg. This information is included in this Annual Report under the section “Share Information”. Financial reporting and role of auditor Annual nancial statements as prepared by the Executive Board must be examined by an external certied auditor before being presented to the General Meeting for adoption. The General Meeting has the authority to appoint the auditor. The Supervisory Board nominates the auditor for (re-)appointment by the General Meeting, taking into account the advice of the Audit and Risk Committee. The auditor’s assignment and remuneration are resolved on by the Supervisory Board, on the recommendation of the Audit and Risk Committee. The external auditor attends Audit and Risk Committee meetings and meetings of the Supervisory Board in which the annual nancial statements are to be approved and the year-end audit report of the external auditor is discussed. Half-year results and reports are discussed with the Audit and Risk Committee in the presence of the external auditors prior to publication. Compliance with the Dutch Corporate Governance Code As a public limited liability company organised under the laws of the Grand Duchy of Luxembourg, the Company is not subject to the Code. However, we acknowledge the importance of good governance and are committed to comply with the principles as set out in the Code. The Executive Board and Supervisory Board believe deviations or qualications of some individual provisions of the Code are justied. These deviations or qualications are explained below. Deviations from the Code Independence of Supervisory Board members Under the best practice provision 2.1.7 and 2.1.8, three out of ve members of the Supervisory Board are considered not to be independent. One member has a shareholding in the Company of at least ten percent and one member was appointed as representative of a legal entity which holds at least ten percent. The third member has a relative by blood in the rst degree that is a member of the management board or supervisory board – or is a representative in some other way – of a legal entity which holds at least ten percent of the shares in the Company. The Company deviates from this provision as it nds it necessary for its Supervisory Board members to have a good understanding of the complex environment in which the Company operates. Furthermore, the representation of (persons in the direct line of descent to) the founder and majority shareholder of B&S, contribute to the long-term commitment towards value creation and continuity. 87 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Establishment of committees The Company reserves the right to deviate from provision 2.3.2 for practical reasons. The regulation of committees states that if the Supervisory Board consists of more than four members, it shall appoint an Audit committee, a Remuneration committee and a Selection and Appointment committee. In the period under review, this provision was deviated from as the Selection and Appointment committee and the Remuneration committee were combined to form one committee. Cancelling the binding nature of a nomination or dismissal Pursuant to the Articles of Association, shareholder Sarabel has a right to nominate candidates for appointment as members of the Supervisory Board. It is not possible under Luxembourg law to set aside the binding nature of the nomination right, which would result in a deviation from best practice principle 4.3.3. Relevant documents on corporate website Articles of Association Executive Board Rules Supervisory Board Rules Charters of Committees Prole Supervisory Board Bilateral contacts policy Code of Conduct Whistleblower Policy Risk appetite Averse Low Moderate High Strategic Operational Compliance Financial To achieve strategic objectives, the Company accepts associated risks up to a moderate level The Company seeks to minimise the risks of operational failures within its business processes With respect to compliance risks, the Company takes a risk averse stance Financial risks are mitigated through a cautious nancing structure and stringent cash management policy There may be risks or risk categories that are currently identied as not having a signicant impact on the business but that could develop into main risks in the future. The objective of the Company’s Enterprise Risk Management model (‘ERM model’) is to timely identify changes in risk proles so that appropriate measures can be taken. The main risks per category are described below. 88 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Risk Management B&S is a globally operating listed Company with a focus on long term value creation. Being active in many different markets worldwide inherently entails risks, not only in the specic markets we are active in but also with regards to business strategy. Companywide strategic objectives are dened by the Executive Board and include the encouragement of entrepreneurship and accountability on segmental level. The Executive Board, supported by the Leadership Team, has in place a well-embedded risk management and internal control system to continuously evaluate the degree to which the Company is in control. This helps to identify and mitigate potential risks and to balance risk and reward in line with the Company’s risk appetite. With the COVID-19 pandemic continuing in 2021, the impact on our operations is considered a main risk and as such an integral part of our principal risks: International nature of our business IT & cybersecurity Inventory Liquidity and working capital management Credit Risks related to climate change and sustainability are an integral part of a number of our main risks, such as reputational risks, international nature of our business and non-compliance with laws and regulations. The related risks are summarized in the compliance risk category. We have reviewed our risk descriptions for these principal risks over the year and enhanced description where relevant to further reect these developments. Other principal risks remain largely unchanged from last year. Risk appetite In general, B&S adapts a conservative approach to risk-taking within an entrepreneurial setting. The risk appetite differs per risk category and is dened as follows: 89 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Risk Description Risk appetite Strategic International nature The risk that trade protection measures, changes in taxation policies or other regulations will negatively impact revenues Managing growth The risk that the Company is unable to manage sustainable organic and acquisitive growth Reputation The risk of an incident occurring that will harm the B&S Company brand Operational IT & Cybersecurity The risk of critical IT systems being unavailable or not well maintained and of the Company being exposed to cyber crime Staff The risk of not nding or retaining qualied people to support our strategy and the business not achieving its full potential Inventory The risk of being unable to manage inventory successfully, leading to tied up capital and / or eroding margins The risk of scarcity or unavailability of goods impacting lead times and business continuity Compliance Compliance standards The risk of non-compliance with statutory laws and regulations in applicable jurisdictions or with internal policies and procedures Customs & Certications The risk of losing any of or authorisations or certications for our bonded warehouses could have negative impact on revenues Climate change & sustainability regulations The risk of non-compliance with climate change & sustainability laws and regulations Financial Currency The risk of inadequately monitoring exchange rate risk that leads to exchange rate losses Credit The risk of delayed or failed payment by customers Liquidity & Working Capital Management The risk that the business has insufcient free cash ow to fund its operations and stay within acceptable debt ratios Supervisory board / Executive board Tax ICT Legal department Warehouse Customs HRMSales Treasury PurchasingFinance & control Concern controling Internal audit External audit Peer group-learning / Benchmarking External advisors Learning and development Enterprise risk management model Enterprise Risk Management model 90 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Enterprise Risk Management model The Executive Board is responsible for establishing and maintaining adequate internal risk management and control systems. Risk identication is performed both top-down and bottom up, based on the Company’s strategy and the environment in which we operate. The Company has developed an ERM model which is continuously monitored by the Supervisory Board, Executive Board, Finance & Reporting, Internal Audit and the Leadership Team. We involve various internal and external stakeholders in the identication, assessment and monitoring of risks, which ts the Company’s entrepreneurial and hands-on mentality. The risk management model is updated when required in order to reect changes in either internal or external conditions. 91 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Main risks and control measures The main risks and control measures are presented below. Risk type Description Mitigation by Strategic International nature of our business The international scope of our operations, particularly in certain developing countries and emerging markets, exposes the Company to risks related to trade protection measures, closure of borders and restriction of travel in case of a global pandemic, changes to taxation policies, changes in regulation, import/export licencing requirements, quotas or wage and price controls. These risks are mitigated by diversication in markets, product groups, regions and client portfolio. The Company has spread its risk over various niche markets all over the world, making it less vulnerable to decline in specic market segments and / or to geographical risks. Although geographical economic recessions can have some effect, the risk of a disproportionally adverse impact will be limited because of the indicated market diversication and regional spread. Managing growth Quality of the Company’s growth should always remain sustainable, manageable and well under control. The Company may fail to meet these standards by inefcient or inadequate controlled organisational aspects, challenging economic market conditions or adverse global events, i.e. pandemics. The Company may fail to acquire other businesses as contemplated by the growth strategy or may fail realise the expected benets from such acquisitions. The Company invests substantially in optimisation and digitisation of business processes and compliance procedures, and in expansion of warehousing and storage facilities. The diversication in markets, product groups, regions and client portfolio, makes the business less cyclical and less vulnerable to changing market conditions. Furthermore, the Company is continuously improving, digitising and controlling its processes in order to be able to adapt quickly to changing circumstances. Acquisitions are preceded by careful due diligence processes carried out by both internal and external experts to ascertain that an acquisition will provide adequate nancial returns and will contribute towards the Company’s synergy and integration demands. The added-value and cash ow contributions of intangible assets is tested regularly. Reputation The Company’s reputation and relationship with suppliers and customers could be harmed by performance failures and incidents occurred by internal or external parties in the supply chain, such as fraud and corruption and cyber incidents. These reputational risks could be resulting in a loss of sales or other nancial impact caused by a harmed reputation. The Company is focused on adding value to its partners’ businesses that provides long-term mutual growth, which results in trustworthy relationships. The focus on maintaining long term partnerships with customers and suppliers makes the Company less vulnerable to reputational damage. Also internal policies and guidelines regarding business agreements with new suppliers and customers are applied through an extensive Know Your Relation (KYR) procedure. Internal and external procedures and policies are in place to avoid incidents, such as fraud and corruption and cyber incidents and adequate reporting channels are in place in case such incidents occur. 92 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Risk type Description Mitigation by Operational IT and cybersecurity The Company relies signicantly on the integrity, reliability and efciency of IT systems and on the services of its third-party IT and payment service providers. Inability to nd qualied service providers or the failure of service providers to perform their obligations could have a material adverse effect on the business, nancial condition and results of operations. With increased digitisation of company processes and business model and cyber criminals becoming increasingly active and sophisticated, the Company considers cybercrime to be a signicant IT threat. The Company has established partnerships with carefully selected IT providers that are acquainted with our business activities and associated needs, and pro-actively implement and continuously optimise the IT systems. The Company maintains a wide range of security measures including access and authorisation controls and back-up and recovery procedures. Compliance with these policies is monitored and controlled. Additionally, the IT systems and procedures are checked regularly by external experts while potential cyber-attacks on the Company’s systems are externally monitored and internally mitigated by various protective and detective measures. Cyber specialists are also assigned to further develop the security policies and controls. Dependency on key staff The Company relies signicantly on the skills and experience of the managerial staff as well as technical, sourcing and sales personnel. A loss of any key individuals or the failure to recruit suitable managers and other key staff, both for expanding operations and for replacing people who leave the Company, could result in an inability to meet customer demand resulting in a loss of customers. This risk is mitigated by recruiting employees to cover both business growth and uctuations in employee composition. In order to attract and retain staff, the Company offers a balanced remuneration package, development programs and a stimulating workplace offering attractive career opportunities. Inventory risk The Company holds sizeable inventory levels with a certain volatility throughout the year. The Company may be unable to manage our inventory successfully resulting in additional tied up capital, eroding margins or unavailability of goods. The Company closely monitors inventory through dedicated inventory management departments which are divided into product categories. Critical stress tests are regularly carried out on the theoretical nancial boundaries of inventory positions versus equity, covenants and nancing. The nancial boundaries itself are continuously assessed to safeguard the Company’s ability to quickly respond to changing market circumstances, like for instance COVID-19. 93 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Risk type Description Mitigation by Compliance Non-compliance with laws and regulations The Company is subject to various laws and regulations in the jurisdictions in which it operates. Changing laws might interfere with the Company’s competitive advantage resulting in a loss of business. Litigation or investigations involving the Company, including those related to the infringement of intellectual property rights of third parties, could result in material settlements, nes, penalties or reputational damage. The business is subject to anti-money laundering, sanctions and anti-bribery laws and regulation and related compliance costs and third-party risks. Breaching these laws and regulations might result in the loss of contracts in our government and defence distribution operations. Business partners are selected carefully and are only accepted after extensive screening that ensures that the Company’s supply chain is transparent, not in breach with any regulations and that the Company is not infringing any intellectual property or trademarks. If deemed necessary, the Company relies on the services of local professional experts for designated compliance areas. Compliance is overseen by the both the Executive Board as well as the Legal department. Strict internal policies and guidelines regarding business agreements with new suppliers and customers are applied through an extensive Know Your Relation (KYR) procedure. In order to avoid corruption, bribery, fraud and other unethical behaviour, the new relations and their Ultimate Beneciary Owner(s) are checked with the OFAC and the EU Sanctions list. Customs and certications The Company has its own warehouses for storing both bonded and duty exempt goods, which requires extensive licensing and certication as an Authorised Economic Operator (AEO) by the customs authorities. Loss of any of the authorisations or certications could impact the Company’s ability to operate its business, full our obligations towards customers or attract new customers. This may result in a loss of turnover or not realising the growth ambition. Also non-compliance with customs and excise laws and regulations may lead to nes and penalties. In order to mitigate the risks from customs activities, the Company has its own expanding customs departments staffed by well-trained experts who are in close contact with customs authorities, which is overseen by the Company Tax Department. Staff follows on-going training courses to keep up to date with customs legislation and related developments. The Company is insured against the risks related to its customs activities and adequate customs guarantees have been issued for its activities. The nancial consequences of customs related calamities are, therefore, covered as far as possible. Each year, the processes related to our AEO status are audited internally and periodically audited externally. The Company follows strict policies and performs crosschecks on compliance. 94 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Risk type Description Mitigation by Climate change & sustainability regulations The international activities of the Company are exposed to risks of non-compliance with climate change & sustainability regulations, resulting from governmental ambitions in the parts of the world we are doing business. Relevant laws and regulations include, but are not limited to, European Green Deal, Non-Financial Reporting Directive (NFRD), Corporate Sustainability Reporting Directive (CSRD), EU Taxonomy. While these risks are primarily compliance risks, these risks can also materialise as strategic, operational and nancial risks, e.g. loss of clients and revenue and loss of competitive advantage. Climate Change & sustainability compliance are overseen by the Executive Board, with the assistance of a QHSE manager and in 2021 assigned sustainability manager. Policies and commitments are in the process of being redened and further developed to incorporate regulatory requirements, focussing on key material matters. In addition, KPI’s and a key control framework will be set up as part of the sustainability strategy 2022 exercise. Further reference is made to “Sustainable operations” in the results section of this report Financial Currency risks The Company is exposed to currency exchange rate risk in the conduct of our business. Inadequate monitoring of our positions might lead to exchange rate losses. The Company deals with risks from transactions in non-Euro currencies by matching incoming and outgoing cash ows as closely as possible in the same currency. Extraordinary currency positions and risks are dealt with at corporate level by a dedicated treasury department, which uses hedging instruments when appropriate and on a case-by- case basis to mitigate currency transaction risks. Derivative transactions are subject to continuous risk management procedures. Derivative nancial contracts are only entered into with banks that have a good credit rating. Credit risks Delayed payment or failure to pay by our customers could have an adverse effect on our business resulting in the Company not being able to grow at the desired rate. The Company applies strict internal policies and guidelines regarding credit risk management. All transactions must be secured, either by credit insurance, payment up front or by a secured payment instrument (guarantee or letter of credit). A centralised credit control department is in place to mitigate credit risks and to monitor compliance with internal credit management policies. 95 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Risk type Description Mitigation by Liquidity & Working Capital Any inability to raise capital or to continue the existing nance arrangements could have a material adverse effect on the business, nancial condition and results of operations. The Company’s activities are mainly nanced on the basis of medium and short-term credit facilities. After the renancing of the Company, which took place in December 2021 (reference is made to Note 23 of the nancial report), the Company has adequate nancing available to secure the nancing for the future growth ambitions of the Company. Both short and long-term nancing arrangements are discussed and negotiated exclusively at Company level by the Executive Board. The internal reporting allows for closely monitoring of the operating segments on protability and compliance with the credit agreements. This also ensures that the companies within the Company are in a position to generate sufcient cash ows for upward dividend streams. For more details about nancial risk management see Note 31 in the consolidated nancial statements. These notes are considered to be part of this report. Internal Audit Throughout the year, certain selected aspects of the execution, follow up and quality of the design and effectiveness of controls are reviewed by the Company’s internal audit function. Priorities for internal audit are dened in dialogue with both the Executive Board and the Audit and Risk Committee of the Supervisory Board. The internal audit function has direct access to both the Executive Board and the Audit and Risk Committee and presents the results of the internal audit activities during the quarterly meetings of the Audit and Risk Committee. In addition to these reviews, sensitivity analyses are conducted on various scenarios to identify focus areas for uncertainty reduction. These scenarios include the effect of rapid changes in market conditions, changes in gross margin, increases of interest rate and currency uctuations. Specic risk-mitigating actions in 2021 In the period under review specic control measures were taken on the following aspects: Control Framework In 2021, the internal control framework has been further developed and improved based on a reassessment of the (fraud) risk assessment. Improvements have been made in the accounting, period-closing and controlling processes, which have been optimised and harmonised based on the newly introduced reporting structure in April 2021. In addition we have increased the efciency and effectivity of review activities and monitoring controls performed by both management and the internal audit department. These review activities and monitoring controls relate amongst others to compliance with trademark and customs laws and regulations, related party transaction and IT-controls. “ In 2021 we enhanced security controls to mitigate cyber security risks.” 96 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance ERP migrations To support the enhancements of review activities and monitoring controls as set out above, we proceeded with the migration of the remaining entities that used to work with legacy systems in to the Company’s inhouse developed and maintained ERP system BiT. Amongst others all entities from the Health segment and the main part of the companies in Dubai and Spain have been migrated to BiT. Also several migrations took place, to align the BIT environment with the newly introduced segment structure. The Internal Audit department reviewed all migrations to ensure accurate and complete conversion of critical data as well as proper segregation of duties within the new BiT environment. In 2022 this migration process will be continued for both existing as well as – when relevant - newly acquired companies. IT & Cyber security In 2021 we have further enhanced our security controls in order to mitigate risks related to cyber security. These controls consist of both preventive as well as detective controls. An independent party (‘ethical hacker’) executed penetration tests on our network and e-commerce applications. Based on both the reported observations and the already existing internal agenda, the physical security has been improved by amongst others harmonization of security policies, further segmentation of the network and tightening of the external monitoring services. Next to that, the Company continued its cybersecurity awareness program amongst employees in order to ensure that everyone remains alert on possible threats. Specic internal control activities planned for 2022 In 2022, the Company will proceed with the ongoing process of optimising and harmonising internal controls and procedures and the monitoring thereon by both Executive Board and the Internal Audit department. Main focus areas are related to controls within the inventory and sales processes, foreign and standalone entities, compliance with laws and regulations, IT and cyber security and the execution of a climate and sustainability risk assessment. All of this is aligned with and in support of the Company’s strategic goals. 97 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Share information B&S Group S.A. shares have been listed on Euronext Amsterdam since March 23, 2018 and have been included in the Smallcap Index (AScX) since June 19, 2018. The issued share capital as at December 31, 2021 amounts to € 5,050,639.26. This is divided into 84,177,321 issued Ordinary Shares each with a nominal value of € 0.06. KEY SHARE INFORMATION ISIN LU1789205884 Euronext ticker BSGR Number of shares outstanding 84,177,321 Free oat 31.0% KEY FIGURES PER SHARE EPS € 0.46 Dividend yield 1 2.5% Highest price € 9.58 Lowest price € 6.45 Year-end share price € 7.10 Dividend policy Barring exceptional circumstances, B&S aims to distribute a dividend of between 40-60% of annual results attributable to the owners of the Company, starting at the lower end of the target range. We envisage increasing dividends per share over time within the set target range. The current dividend policy is to pay out annually, in the second quarter of the following year, following shareholder approval of the full-year nancial statements. Dividend proposal 2021 At the Annual General Meeting to be held on May 17, 2022, B&S Group will propose the payment of € 0.18 per share, in cash (subject to withholding tax if applicable). This translates into a pay-out ratio of 40% of the annual results attributable to the owners of the Company. Notication of capital interests On December 31, 2021, the following major shareholders with a substantial participating interest (>5%) are known by based on a former notication by them in accordance with the Transparency Law 2 . Sarabel Invest S.à r.l 67.26% Mondrian Investment Partners Ltd 5.18% JNE Partners LLP 5.17% 2 Law of 11 January 2008 on transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market. 1 The proposal to distribute divided payment over 2021 shall be submitted to the General Meeting of Shareholders on May 17, 2022. 98 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance FINANCIAL CALENDAR Q1 2022 trading update May 16, 2022 Annual General Meeting May 17, 2022 HY 2022 results August 22, 2022 Q3 2022 trading update November 7, 2022 Investor relations policy B&S provides shareholders and other parties in the nancial markets with information on matters that may inuence the Company’s share price via an annual report and an interim report, Q1 and Q3 trading updates and press releases. These documents are published on the B&S corporate website and submitted to the AFM (the Netherlands) and CSSF (Luxembourg). B&S has a compliance ofcer who monitors and enforces strict compliance with any and all relevant laws and regulations. Together with the Executive Board and the Disclosure Committee, the compliance ofcer assesses whether and when information is price- sensitive and whether a disclosure obligation applies to said information. These regulations apply to both the Supervisory Board and the Executive Board, but also to the management layer below the Executive Board and all head ofce staff who come into contact with price-sensitive information. Investor contact B&S communicates with its investors and analysts throughout the year via meetings such as AGMs, roadshows, organised site visits and broker conferences. The Company holds regular investor calls and meetings to provide the investment community with a well-balanced and complete picture of the performance, opportunities and challenges the Company faces, while taking into account insider trading and the equal treatment of shareholders. General meeting General Meetings of Shareholders are convened in accordance with the provisions of the Luxembourg law of May 24, 2011 on the exercise of certain rights of shareholders in general meetings of listed companies and the Articles of Association. The General Meeting of Shareholders will be held on May 17, 2022 in Luxembourg (provided the absence of travel restrictions due to Covid-19). Contacts with the capital markets are dealt with by the members of the Executive Board and the Investor Relations Manager. Independent analyst reports The following analysts covered B&S in the course of 2021: ABN - ODDO BHF Robert Jan Vos ING Tijs Hollestelle Kepler Cheuvreux Patrick Roquas 99 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Statement of the Executive Board The Executive Board has made a systematic assessment of the effectiveness of the design and operation of the internal control and risk management systems. On the basis of this assessment and in accordance with best practice 1.4.3 of the Dutch Corporate Governance Code of December 2016, article 68ter of the Luxembourg RCS Law 1 and article 3 of the Luxembourg Transparency Law 2 , the aforementioned assessment and the current state of affairs, to the best of its knowledge and belief, the Executive Board conrms that: the internal risk management and control systems of the Company provide reasonable assurance that nancial reporting does not contain any material inaccuracies; there have been no material failings in the effectiveness of the internal risk management and control systems of the Company; there are no material risks or uncertainties that could reasonably be expected to have a material adverse effect on the continuity of the Company’s operations in the coming twelve months after drawing up the report, and; drawing up the nancial reporting on a going concern basis is justied based on the current state of affairs. It should be noted that the above does not imply that these systems and procedures provide absolute assurance as to the realisation of operational and strategic business objectives, or that they can prevent all misstatements, inaccuracies, errors, fraud and non-compliances with legislation, rules and regulations. Nor can they provide certainty that we will achieve our objectives. In view of all of the above, the Executive Board declares that, to the best of its knowledge and belief, the nancial statements presented in this annual report and prepared in accordance with IFRS standards as adopted by the European Union, give a true and fair view of the assets, liabilities, nancial position and prot or loss of the Company and of the undertakings audited in the consolidation taken as a whole; and that the management report includes a fair review of the position at the balance sheet date and the development and performance of the business during the nancial year and of the undertakings audited in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that the Company faces. Mensdorf, G.D. Luxembourg, February 28, 2022 Executive Board Tako de Haan, CEO Peter Kruithof, CFO Bas Schreuders, Senior Counsel Niels Groen, Managing Director 1 Law of 19 December 2002 on the register of commerce and companies and the accounting and annual accounts of undertakings, as amended. 2 Law of 11 January 2008 on transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market, as amended. “ E-commerce development and sustainable, protable online growth were important topics for the Supervisory Board.” Jan Arie van Barneveld 100 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Message from the chairman 2021 was undoubtedly a transformational year for B&S as the rst year of the implementation of its 2021 – 2023 strategy. It was also a year marked by the ongoing challenges and uncertainties driven by the pandemic. Yet through resilience, entrepreneurship and adaptability of the B&S workforce around the globe, the Company improved its protability and delivered on virtually all nancial targets. As the tech-oriented direction of B&S began to take solid form, e-commerce development and sustainable, protable online growth were important topics for the Supervisory Board (SB). We looked specically into protability of the different business models and relevant parameters to track performance. The SB notes that the technology backbone (B&S Nnity) made a promising start, and see it as a catalyst for furthering the digital transformation of B&S. I am positive that 2022 will be a signicant year in this transformation as the appetite for digital supply chains that provide easy access and smart delivery is enormous around the globe. The Supervisory Board would like to thank the Executive Board and also the Leadership team for their entrepreneurial approach to the challenges provided by the pandemic as well as the centralised approach that has been embraced unanimously. I would also like to thank my colleagues in the Supervisory Board for the smooth collaboration especially considering accelerated use of the online meeting environment during the pandemic. Jan Arie van Barneveld Chairman Supervisory Board report Main topics In exercising its tasks in 2021, the Supervisory Board (SB), after consultation with the Executive Board (EB) and members of the Leadership team identied a number of topics which would be SB priorities for the year. At its request, the Supervisory Board was more closely involved in the 2021 – 2023 strategic plan and progress made than in previous instances. After the strategy kickoff session in January 2021, the SB received regular status updates and discussed how the strategy and business model can further simplify operations and enhance synergies between the segments and business units globally. We also stressed the importance of adhering to the “Business in the lead” principle for maintaining local strength and business ownership to act on opportunities quickly. Throughout the year, possible implementation risks were discussed and the SB emphasized the need for clarity about responsibilities, a robust implementation program, strong leadership and role modelling from the top. The SB is optimistic about the outcome so far and is condent that the 2021 – 2023 strategy enables further growth in 2022 and beyond. As part of the strategic plan, the SB was consulted on the composition of a Leadership team to support the Executive Board in day-to-day decision making and further the clarication of responsibilities. Over the course of 2021, Managing Directors for the newly introduced operating segment were ofcially appointed after consultation with the SB. On August 2, 2021 the Leadership team was extended with the appointment of Arben Hajrullahu as Chief Commercial Ofcer (CCO) to lead the development and execution of the Company’s commercial strategy. Regarding digitisation, we continued to discuss the IT project approach in each scheduled meeting with the Executive Board. By sharing suggestions and expertise in this eld the SB contributes to further improvement of the Digital First approach of the Company. Topics discussed include the centralised project approach with PMO for streamlined execution, increased project delivery and quality. Also, harmonisation of data for company wide use, the role of data science across the board and the development of the overarching e-com platform - delivered end 2021 as B&S Nnity – were frequent topics on the agenda. The SB received regular updates on the progress in centralisation of operations to reduce costs and effective utilisation of centralised corporate support functions and shared services centers. In extension, recurrent attention was paid to safeguarding the healthy nancial position of the company during the ongoing market unpredictability on the back of the pandemic. Priority was discussion to keep inventory management (and thus working capital management) priority for P&L responsible Managing Directors and embed it as a structural part of their responsibility. In addition, cash collection initiatives have been part of our discussions with the EB, including how to make DSO (days sales outstanding) a priority with the assigned Managing Directors and commercial staff of the six operating segments. The SB and EB are pleased with the progress made yet still see further potential for improvement in 2022. Another key matter in multiple SB meetings was the centralised renancing proposal presented by the EB to t growth ambitions of the Company for the medium term. Both the proposed nancing structure and implementation timelines were discussed and subsequently approved by the SB. Lastly, the SB was pleased to see B&S accelerate its efforts in 2021 to embed sustainability practices in its own business operations as well as develop a roadmap for companywide strategic sustainability objectives to be implemented from 2022 onwards. The SB received regular updates on progress and is keen to see further steps executed in 2022. Meetings In 2021 the SB meetings were held via videoconference, as permitted by the laws on measures concerning the holding of meetings in companies and other legal persons due to Covid-19. 101 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance In 2021, the Chairman met with the Executive Board on multiple occasions, both pre-scheduled in preparation for meetings between the Supervisory Board and the Executive Board, as well as in impromptu meetings / conference calls. The full Supervisory Board in its current form met ve times in the presence of the Executive Board. Functioning of the Supervisory Board and Executive Board We performed an annual assessment of the performance of the Supervisory Board and Executive Board that addressed various aspects of the performance of itself, the committees and individual members. The overall conclusion is that both Boards individually work well, with mutual respect and transparency. Also, the relationship between the Supervisory Board and the Executive Board and the Leadership team is very open and the level of information sharing is good. The committees operate as required, and the members in these committees complement each other in the areas of knowledge, experience and personalities. Some points of attention were formulated under which maintaining regular conversations with the Leadership team, as well as with Directors of corporate support functions to provide functional updates on key projects progress relevant to company strategy. Composition of the Boards In the composition of the Boards, the Group strives for sufcient complementarity, pluralism and diversity with regard to age, gender and background. The main aim is to create a diverse mix of knowledge, skills, expertise and personal characters. At the same time, the knowledge the Company requires in its key markets is still a key appointment criterium. The composition of the Supervisory Board is such that its members are able to provide the Executive Board with optimum support in any particular eld of interest. Each member of the Supervisory Board has his or her own eld of expertise, including expertise in retail markets, international trade, IT and online consumer behaviour, general management, nance and law. For the current composition of the Executive Board and the Supervisory Board and its committees, please refer to page 78 – 81 of this report. Committees The Supervisory Board has installed two committees, an Audit and Risk Committee and a Selection, Appointment and Remuneration Committee. These committees are also subject to the regulations that are available on the corporate website. The task of these committees is to support and assist the Supervisory Board in the performance of its designated tasks and to prepare the ground for the Supervisory Board’s supervision of the Executive Board. The Supervisory Board as a whole remains responsible for how it exercises its tasks, including the preparatory activities carried out by the Audit and Risk Committee (ARC) and the Selection, Appointment and Remuneration Committee (SARCO). Independence of the Supervisory Board members / Corporate governance The Supervisory Board meets the requirements of the Dutch Corporate Governance Code with regards to independence of the Chairman. Three out of ve members of the Supervisory Board do not qualify as independent members of the Supervisory Board within the meaning of the Code, it concerns Mr Cornelisse, Mr W. Blijdorp and Mr L. Blijdorp. Under the chapter Governance in this report, the governance structure of the Company as well as the deviations from the Dutch Corporate Governance Code – as these are underwritten by the Company - are described in more detail. 102 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance 103 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Leendert Blijdorp (Chair) and Jan Arie van Barneveld (member). Audit and Risk Committee Report The Audit and Risk Committee (ARC) is responsible for interactions and meetings with the external auditor as well as establishing the procedure for the selection of the external auditor. It holds responsibility for recommendations to the Supervisory Board of an external auditor for nomination for appointment and its compensation, or dismissal by the General Meeting. In addition, the ARC assists the Supervisory Board in making recommendations to the General Meeting for the retention, oversight and termination of the external auditor. It also interacts with several nancial and internal audit executives and assists in assessing and mitigating the business and nancial risks of the Group. The members of the ARC are Mr Leendert Blijdorp (chairman) and Mr Van Barneveld. Meetings In 2021, the ARC had four regular scheduled meetings. Except for one occasion where the Finance Director was absent, all regular scheduled meetings were attended by the Group CFO, the Finance Director and the Director Internal Audit. The ARC convened several additional meetings with the Executive Board and/or support teams, and with the CFO individually to address specic risk developments and actions taken to mitigate these. Specic focus areas during these meetings were related to the quality of nancial reporting and closing procedures, IT and Cyber Security, fraud prevention systems and control, compliance with its policy and legislative requirements and the impact of Covid-19 and other business developments. The Chairman of the Committee also had regular meetings with the Director Internal Audit and external auditor, to provide additional opportunity for open dialogue and feedback. Audit and Risk Committee Report It is customary that the ARC shares its main discussion points and ndings and the minutes of these meetings in the Supervisory Board meeting following the ARC meeting. During these meetings, the Company’s results as well as the annual and semi-annual reports were discussed. The Audit Committee in particular paid attention to the more technical reporting aspects, and the reporting on Covid-19 developments. Financial statements The FY2021 nancial statements were prepared by the Executive Board, and the external auditor subsequently issued an auditor’s report on said nancial statements. This report is included in the independent auditor’s report. In its February 2022 meeting, the ARC discussed the nancial statements in detail with the Executive Board and the Supervisory Board and discussed the audit of the nancial statements with the external auditor. Risk management and control framework The main points of discussion throughout the year were the internal control framework and the execution of the 2021 internal audit calendar, with special attention to the harmonisation of month-end closing procedures and migration of BiT systems. In each scheduled meeting, the Director Internal Audit presented main internal audit ndings, and progress made with regard to the annual internal audit plan was discussed. During the ARC meeting in February 2021, the harmonisation of the ERP systems and related IT-controls were discussed. Also the Director Internal Audit presented the audit report on the effectiveness of credit control procedures and the audit report regarding controls within the purchasing process. 104 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance In the May meeting, the improved related party transaction procedures were discussed and subsequently approved by the SB. Apart from that, the ARC discussed the developments regarding IT and cyber security. In the August meeting the Director Internal Audit presented the audit plan for the second half year of 2021, focussing on compliance with laws and regulations, the quality of nancial reporting and month-end closing procedures and controls within the ERP system. During the November meeting a few specic reports and position papers from the Director Internal Audit were discussed, mainly focussing on month-end closing procedures, compliance with trademark laws and regulations and cyber security. External auditor Throughout the year the ARC discussed and assessed progress with external auditor Deloitte on their key audit ndings. As is customary, the ARC also evaluated the performance of the external Auditor Deloitte. During the August meeting, the half year report was discussed as well as the external audit plan for 2021, which was approved. Also, in the November 2021 meeting, the management letter from the external auditor was discussed. Financing Throughout the year, substantial attention was devoted to the nancing of the Company. The Executive Board kept in close contact with all its relationship banks and shared all relevant updates with the ARC accordingly. In 2020 a covenant holiday was granted by all banks for three test periods until HY 2021. In 2021 regular meetings between the ARC and Executive Board also took place regarding the re-nancing of the company. Reference is made to Note 23 of the nancial statements. FY2021 nancial statements and dividend The Supervisory Board has approved the FY2021 nancial statements and recommends that the Annual General Meeting to be held on May 17, 2022 adopts these nancial statements. The Supervisory Board also recommends that the Annual General Meeting discharges the members of the Executive Board for their management of the company and the members of the Supervisory Board for their supervision of said management for the nancial year 2021. The distribution of dividend over 2021 was topic of discussion in the Supervisory Board meeting of February 25, 2022. At the Annual General Meeting to be held on May 17, 2022, B&S will propose the payment of € 0.18 per share, in cash (subject to withholding tax if applicable). This translates into a pay-out ratio of 40% of the annual results attributable to the owners of the Company. “ The Covid-19 pandemic challenges in 2021 lasted longer than initially expected.The Supervisory Board recognised these challenges and weighed them at the assessment of the Executive Board performance. We believe the Executive Board made clear progress in executing on the new strategy, making use of changing business dynamics to increase protability.” Kitty Koelemeijer, Chair of the Selection, Appointment and Remuneration Committee 105 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Remuneration report The remuneration of the members of the Executive Board is determined by the Supervisory Board in accordance with the remuneration policy, as approved by the General Meeting of Shareholders; with exception of below mentioned discretionary adjustments. The General Meeting of Shareholders also approves the remuneration of the members of the Supervisory Board. The Selection, Appointment and Remuneration Committee (SARCO) advises the Supervisory Board regarding selection, appointment and remuneration matters of Board members, senior management and/or other personnel. Members of the SARCO are Ms. K. Koelemeijer (Chair), Mr. J. van Barneveld and Mr. W. Blijdorp. This report outlines the remuneration policy for the Executive Board and the Supervisory Board as applied in 2021. Executive Board remuneration policy The remuneration of the members of the Executive Board is the responsibility of the Supervisory Board. The objective of the remuneration policy for members of the Executive Board is to provide a remuneration structure that will allow the company to attract, reward and retain highly qualied members of the Executive Board and provide and motivate them with a balanced and competitive remuneration that is focused on sustainable results aligned with the long-term strategy of the company. The remuneration policy follows best practice provision 3.1.2 of the Dutch Corporate Governance Code. The pay ratios within the Group are taken into consideration. The Supervisory Board believes that the remuneration policy expedites the short-term operational performance and the objectives for the strategy for long-term value creation within the meaning of best practice provision 1.1.1 of the Dutch Corporate Governance Code. Furthermore, the Supervisory Board believes that the value of the remuneration for the members of the Executive Board for 2021 also contributes to the aforementioned objectives and meets the remuneration policy. All substantial future changes to the 106 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance remuneration policy will be submitted to the General Meeting of Shareholders for their advisory vote. Remuneration policy review The remuneration policy was last approved by the General Meeting of Shareholders on May 18, 2021, and involved changes with regards to the following aspects: ‘Share Appreciation Rights’ were added as a long-term variable remuneration component for eligible Executive Board members The conditional award of variable remuneration and a claw back arrangement have been added to stimulate fair long-term commitment and value creation. As a result of the review, the current Remuneration Policy stimulates decision-making by the aforementioned Board Members that serves long-term sustainable growth in a long-term incentivised manner. Additionally, the conditional award of variable remuneration and a claw back arrangement contribute to a fair and reasonable way of remuneration payment. Employment contracts The effective dates of employment contract for members of the Executive Board and their contract term are shown in the table below. Effective dates of employment contracts of the Executive Board members and their contract term Name Effective date contract Contract term Mr. de Haan 1 August 11, 2020 4 years Mr. Kruithof 2 May 19, 2020 4 years Mr. Schreuders 3 May 19, 2020 4 years Mr. Groen 4 May 19, 2020 4 years 1 Mr. de Haan was appointed to the Board on August 11, 2020. 2 Mr. Kruithof was appointed to the Board on May 19, 2020. 3 Mr Schreuders was reappointed to the Board on May 19, 2020. 4 Mr Groen was reappointed to the Board on May 19, 2020. The terms of the agreements with the Executive Board members are in line with B&S’s remuneration policy. Remuneration structure The remuneration structure for the Executive Board focuses on achievement of both short-term results and long-term value creation by pursuing growth opportunities through B&S’s capabilities as a tech company in the consumer goods industry with a very strong global network. The total remuneration and the remuneration components are based on the going rates of what the Supervisory Board considers to be in line with international trade and distribution services market and globally benchmarked against companies which are similar to B&S in terms of scale and complexity. 107 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Before the level of remuneration of individual board members is determined, scenario analyses with regards to the variable remuneration components are conducted to determine their consequences on the level of remuneration of these Board members. The level and structure of the remuneration takes into account the previously described scenario analyses and the pay differentials within the company as well as nancial and non-nancial indicators relevant to the long-term objectives of the company. Remuneration components The members of the Executive Board express their views of their remuneration packages with the SARCO at least once a year. The SARCO includes all feedback when evaluating the Remuneration Policy. The remuneration package for members of the Executive Board, following the adoption of the remuneration policy, consists of the following components: Fixed Compensation The annual base pay salary of the members of the Executive Board was set by the Supervisory Board, taking into account a variety of factors such as level of responsibility, experience, scarcity of talent, scale and complexity of the Company. The aggregate annual base pay in 2021 for the members of the Executive Board was € 1,132,000. Fringe benets could include a company car. These benets complement the competitive remuneration package for our Executive Board. Pension could be included in the salary of a member of the Executive Board. Termination arrangements / Severance payments The management service agreements with members of the Executive Board contain termination arrangements. The management service agreement with the current CEO and CFO contains a severance payment equal to twelve months xed salary. Payment is only provided in the event of termination on the day after which the Annual General Meeting is held in the year the current term expires, or by notice for termination given by the Company before that date, other than as a result of seriously culpable or negligent behaviour or after two years of illness. In all other cases of termination, e.g. in the event of termination at the CEO or CFO’s initiative, the CEO or CFO shall not be entitled to the severance payment. Management service agreements for other current members of the Executive Board require payment of statutory severance payment. Performance Incentive (PI) The PI is an annual cash bonus that is applicable to the CEO and CFO of the Company and the Managing Director (MD) of our Dubai operations. The objective of the variable remuneration is to ensure that these members of the Executive Board are well incentivised to achieve their performance targets. Performance criteria and targets that underlie the PI, are set yearly by the Supervisory Board based on the strategy aspirations and annual business plans and reviewed annually. The performance targets are challenging, yet realistic and measure the success of the execution of the strategy of B&S. The performance targets that have been agreed, contribute to long-term value creation and the PI is linked to measurable performance criteria. 108 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance The nal assessment of the performance, based on the audited nancial results at the end of the scal year, is done by the SARCO and proposed for decision making by the Supervisory Board. In preparation for that nal assessment, the Supervisory Board members review the nal outcomes as reported by the SARCO and the Audit and Risk Committee, to ensure complete alignment on performance by both committees. Criteria CEO CFO MD * Financial performance targets 1 Prot before tax 2 Good working capital management Non-nancial performance targets 3 Successful execution of Company strategy 4 Quality of information, administrative organisation and internal control * Criteria for MD are related to the business operations in Dubai. For 2021, the Supervisory Board determined the PI criteria as presented above. The nancial performance targets (1 and 2) contribute to the Company’s overall focus on longterm value creation by pursuing sustainable and protable growth. The non-nancial performance target related to strategy (3), should contribute to the Company’s goal of expansion of its role as value adding distribution partner whilst creating sustainable and protable growth. This performance target supports overall focus on long-term value creation. The non-nancial performance target related to the quality of information, administrative organisation and internal control (4), supports investor communication and expectations, for the benet of our relations with the investor community. Furthermore, a sound administrative organisation and good internal controls contribute to long-term value creation. The Supervisory Board will determine suitable weightings per year, aligned with the strategic objectives. Financial measures will usually have a weighting of 40% and non-nancial measures will usually weigh 60%. The Supervisory Board evaluates the performance of the Executive Board at least once a year, in which they assess to which extent the performance criteria have been met. The total annual performance cash incentive shall not exceed 50% of their xed fee for CEO and CFO or 50% of the MD’s directors fee. 109 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Share Appreciation Rights (SAR) In 2021, SAR’s over the nancial year of 2020 were granted. The Board members may exercise these SAR’s based upon the LTI SAR rules stated in the Remuneration Policy of May 2020. On February 22, 2021 the Supervisory Board granted 125,000 SARs to the CEO and 20,000 SARs to the CFO, which was approved by the Annual General Meeting of 2021. The exercise price is set at € 7.34. The vesting date for SARs will be three years (up until February 22, 2024). Options can be exercised during three years after vesting (from February 22, 2024 to February 22, 2027). The SARs and the application of a vesting period encourages commitment to the Company and long-term sustainability of the business, the strategy and interests of the Company and its stakeholders. The SAR scheme is approved by the Annual General Meeting of 2021. For the year 2021 no SARs are granted. 2020 Total T. de Haan 125,000 125,000 P. Kruithof 20,000 20,000 B.L.M. Schreuders - - N .G. P. G r oen - - Range of exercise prices in € 7.34 Pension contribution For the CEO and CFO of the Executive Board, no pension contribution plan is in place. For the other members of the Executive Board, the dened contribution pension expense is included in the table ‘Overview remuneration Executive Board 2021’. Discretionary adjustments for granting PI over 2021 Following the longer than anticipated effects of the Covid-19 pandemic, in line with 2020 the Supervisory Board made use of its right to perform discretionary adjustments for the nancial year 2021 with regards to granting annual cash bonus for the CEO and the CFO. The annual cash bonus for 2021 for the CEO and CFO was subject to approval of the Supervisory Board in its meeting of January 30, 2022. Considering the discretionary adjustments, pay-out for 2021 will be € 250,000 for the CEO and € 250,000 for the CFO. The annual bonus for the MD (Dubai) is discretionary proposed at € 100,000. The clear progress on the execution of the strategy has been the main driver of these adjustments. Despite both the direct and the indirect ongoing impact of the pandemic, beyond previous expectations, the nancial performance of the Group signicantly improved. The annual cash bonus will be paid in 2022 after approval of the Annual Accounts 2021 by the Annual General Meeting. 110 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Overview remuneration Executive Board 2021 Remuneration of Executive Board members for 2021 1 € x 1,000 Fixed Remuneration – annual base pay Severance payments PI – annual cash bonus plan Pension expense Total remu- neration Proportion of xed and variable remunera- tion Base salary Fees Fringe benets xed Variable T. de Haan, CEO 500 - 31 - - 250 - 781 50% P. Kruithof, CFO 320 - 18 - - 250 - 588 78% B.L.M. Schreuders, Senior Counsel 148 - 25 - - - 11 183 0% N.G.P. Groen, MD 165 - 28 - - 100 13 306 61% 1 including payments from undertakings belonging to the same group with the meaning of Article 1711-1 of the amended law of 19 August 1915. Loans The company has issued no loans or guarantees to members of the Executive Board. Comparative information on remuneration and company performance According to the Supervisory Board, the Executive Board remuneration is proportional and acceptable compared to the company performance and the average remuneration of employees on a full-time equivalent basis. 111 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Comparative table over the remuneration and company performance over the last reported nancial years after the company’s listing (RFY) Annual Change € x 1,000 Information regarding the RFY RF Y-1 RF Y-2 RFY-3 Remuneration J.B. Meulman - 713 1,121 1,245 G. van Laar - 121 467 508 T. de Haan 781 634 - - P. Kruithof 588 299 - - B.L.M. Schreuders 183 160 159 131 N .G. P. G r oen 306 235 151 127 Company Performance Financial metric: Prot before tax 71.7 51.2 77.5 90.8 Average remuneration on a full-time equivalent basis of employees Employees of the group 63 62 58 58 Claw back The remuneration policy of May 18, 2021 approved by the General Meeting of Shareholders, added a claw back arrangement. The Supervisory Board has the authority to claim back variable compensation that has been paid out, to the extent such payment was based on incorrect information, including nancial statements concerning the achievement of targets or the occurrence of circumstances that the bonus was dependent on. 112 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance Conditionally awarded variable remuneration The remuneration policy of May 18, 2021 approved by the General Meeting of Shareholders, added an arrangement for conditional award of variable remuneration. If in the opinion of the Supervisory Board, the termination of variable remuneration awarded in a previous year would produce an unfair result due to extraordinary circumstances that occurred during the period in which the predetermined performance criteria have been or should have been achieved, the Supervisory Board has the power to adjust the value of such variable remuneration that would have been payable, thereby applying principles of reasonableness and fairness. Supervisory Board remuneration The Annual General Meeting of Shareholders determines the remuneration of the Supervisory Board members, and it may be reviewed annually and thereafter proposed to the Annual General Meeting of Shareholders. The remuneration of the members of the Supervisory Board consists of xed annual fees for their role as Supervisory Board member. In addition, the Chairman receives a xed annual fee for this role. The Group does not grant variable remuneration to the members of the Supervisory Board. Members of the Supervisory Board do not receive any performance or equity-related compensation and do not accrue any pension rights with the company. The company does not grant stock options, share appreciation rights or shares to the members of the Supervisory Board. As per December 31, 2021, the members of the Supervisory Board have no loans outstanding with the Group. Supervisory Board remuneration in 2021 The annual base pay for every Supervisory Board member was €50,000. After the Annual General Meeting of Shareholders (AGM) of May, 2021, this base pay was increased with €10,000, and put into effect from the AGM 2021 onwards. The Chairman of the Supervisory Board received an additional annual fee of €5,000; after the AGM of May, 2021, this additional fee was increased to €10,000, and put into effect from the AGM 2021 onwards. Supervisory Board remuneration 2021 Amount (in €) Supervisory Board member Jan Arie van Barneveld (Chairman) 64,000 Willem Blijdorp (Vice-chairman) 56,000 Coert Beerman (Until May 18, 2021) 22,500 Leendert Blijdorp (As of May 19, 2021) 37,233 Rob Cornelisse 56,000 Kitty Koelemeijer 56,000 Total 291,733 On behalf of the Supervisory Board Jan Arie van Barneveld Chairman Read the story 113 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Financial statementsGovernance business story Delivered solutions: Distribution, Marketing, Brand Development The ofcial launch of Ukiyo Spirits in Amsterdam When you want to expand your spirits brand in multiple countries, you need a strong partner who is able to cross borders and beyond. So when Kirker Greer’s Ukiyo Spirits brand was looking for a partner in Europe to introduce their Japanese Gin and Vodka, they found a perfect match in B&S. As one of the leading brand building distributors, we can build brands on European level and distribute them to multiple territories. Live healthy B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 114 Financial statements 115 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Consolidated statement of prot or loss 116 Consolidated statement of prot or loss and other comprehensive income 117 Consolidated statement of nancial position 118 Consolidated statement of changes in equity 120 Consolidated statement of cash ows 122 Notes to the consolidated nancial statements 124 1 General 124 2 Adoption of new and revised International Financial Reporting Standards (“IFRS”) 124 3 Signicantaccountingpolicies 125 4 Critical accounting judgements and key sources of uncertainty 137 5 Segment reporting 138 6 Turnover 140 7 Personnel costs 141 8 Other operating expenses 142 9 Financial expenses 142 10 Taxation on the result 142 11 Earnings per share 143 12 Goodwill 143 13 Other intangible assets 148 14 Property, plant and equipment 151 15 Investments in associates 154 16 Receivables 155 17 Deferred tax assets 155 18 Inventory 156 19 Trade receivables 156 20 Share capital 157 21 Reserves 158 22 Non-controlling interest 159 23 Loans and borrowings 160 24 Leases 162 25 Deferred tax liabilities 163 26 Retirementandotheremployeebenetobligations 163 27 Other provisions 165 28 Other liabilities 166 29 Other current liabilities 167 30 Contingent liabilities and contingent assets 168 31 Riskmanagementandnancialinstruments 168 32 Related party transactions 176 33 Acquisitions 177 34 Subsequent events 178 Other Information 179 Independent auditor’s report 180 List of subsidiaries 185 Contact 185 Contents 116 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Consolidatedstatementofprotorloss for the year ended December 31, 2021 x € 1,000 Note 2021 2020 CONTINUING OPERATIONS Turnover 6 1,869,507 1,861,760 Purchase value 1,582,206 1,606,869 Grossprot 287,301 254,891 Personnel costs 7 117,610 115,749 Amortisation 13 11,626 12,709 Depreciation 14 7,629 9,157 Depreciation right-of-use assets 24 11,455 10,580 Impairment of non-current assets 12 10,193 - Other operating expenses 8 53,327 48,823 Total operating expenses 211,840 197,018 Operating result 75,461 57,873 Financial expenses 9 (3,889) (7,004) Shareofprotofassociates 15 159 305 Result before taxation 71,731 51,174 Taxation on the result 10 (17,157) (10,536) Protfortheyearfromcontinuingoperations 54,574 40,638 Attributable to: Owners of the Company 38,471 21,697 Non-controlling interests 16,103 18,941 Total 54,574 40,638 Earnings per share (basic / diluted) From continuing operations in euros 11 0.46 0.26 Theaccompanyingnotesareanintegralpartoftheseconsolidatednancialstatements. 117 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Consolidatedstatementofprotorlossandothercomprehensiveincome for the year ended December 31, 2021 x € 1,000 2021 2020 Protfortheyearfromcontinuingoperations 54,574 40,638 Other comprehensive income Itemsthatmaybereclassiedsubsequentlytoprotorloss • Foreign currency translation differences net of tax 8,344 (9,891) • Effectiveportionofchangesinfairvalueofcashowhedgesnetoftax (1,112) 414 Other comprehensive income for the year net of tax 7,232 (9,477) Total comprehensive income for the year 61,806 31,161 Attributable to: Owners of the Company 42,559 16,487 Non-controlling interests 19,247 14,674 Total 61,806 31,161 Theaccompanyingnotesareanintegralpartoftheseconsolidatednancialstatements. 118 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Consolidatedstatementofnancialposition at December 31, 2021 x € 1,000 Note 31.12.2021 31.12.2020 Non-current assets Goodwill 12 65,092 62,337 Other intangible assets 13 54,061 60,258 Property, plant and equipment 14 38,078 37,327 Right-of-use assets 24 60,680 66,075 Investments in associates 15 2,783 2,630 Receivables 16 1,234 1,444 Deferred tax assets 17 2,300 1,417 224,228 231,488 Current assets Inventory 18 381,763 308,273 Trade receivables 19 195,038 195,628 Corporate income tax receivables 6,090 4,312 Other tax receivables 17,023 11,295 Other receivables 21,027 17,619 Cash and cash equivalents 12,547 38,870 633,488 575,997 Total assets 857,716 807,485 Theaccompanyingnotesareanintegralpartoftheseconsolidatednancialstatements. 119 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements x € 1,000 Note 31.12.2021 31.12.2020 Equity attributable to Owners of the Company 264,164 256,375 Non-controlling interest 22 39,107 50,527 303,271 306,902 Non-current liabilities Loans and borrowings 23 180,956 49,496 Lease liabilities 24 58,344 56,698 Deferred tax liabilities 25 10,966 10,684 Employeebenetobligations 26 1,359 1,001 Other provisions 27 1,002 1,500 Other liabilities 28 39,089 42,727 291,716 162,106 Current liabilities Loans and borrowings 23 59,925 178,130 Lease liabilities due within one year 24 11,035 10,034 Trade payables 106,652 102,477 Corporate income tax liabilities 9,157 9,096 Other tax liabilities 9,791 11,425 Other current liabilities 29 66,169 27,315 262,729 338,477 Total equity and liabilities 857,716 807,485 Theaccompanyingnotesareanintegralpartoftheseconsolidatednancialstatements. 120 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Consolidated statement of changes in equity for the year ended at December 31, 2021 x € 1,000 2021 Paid-up share capital Hedging reserve Translation reserve Retained earnings Total attributable to Owners Non- controlling interest Total equity Balance as at January 1 5,051 1,066 (5,360) 255,618 256,375 50,527 306,902 Total comprehensive income • Protfortheyearfromcontinuingoperations - - - 38,471 38,471 16,103 54,574 • Other comprehensive income for the year - (1,097) 5,185 - 4,088 3,144 7,232 - (1,097) 5,185 38,471 42,559 19,247 61,806 Other transactions • Dividend - - - (8,418) (8,418) (11,986) (20,404) • Transactions under common control - - - (34,256) (34,256) (15,178) (49,434) • Protsharecerticates - - - - - - - • Share-based payments - - - 900 900 - 900 - - - (41,774) (41,774) (27,164) (68,938) • Reclassicationtonon-currentliabilities - - - - - (3,503) (3,503) • Fair value adjustment non-current liabilities - - - 7,004 7,004 - 7,004 - - - 7,004 7,004 (3,503) 3,501 Balance as at December 31 5,051 (31) (175) 259,319 264,164 39,107 303,271 Theaccompanyingnotesareanintegralpartoftheseconsolidatednancialstatements. 121 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements x € 1,000 2020 Paid-up share capital Hedging reserve Translation reserve Retained earnings Total attributable to Owners Non- controlling interest Total equity Balance as at January 1 5,051 643 273 236,704 242,671 49,096 291,767 Total comprehensive income • Protfortheyearfromcontinuingoperations - - - 21,697 21,697 18,941 40,638 • Other comprehensive income for the year - 423 (5,633) - (5,210) (4,267) (9,477) - 423 (5,633) 21,697 16,487 14,674 31,161 Other transactions • Dividend - - - - - (13,262) (13,262) • Transactions under common control - - - (681) (681) (1,619) (2,300) • Protsharecerticates - - - (79) (79) (292) (371) • Share-based payments - - - 900 900 - 900 - - - 140 140 (15,173) (15,033) • Reclassicationtonon-currentliabilities - - - - - 1,930 1,930 • Fair value adjustment non-current liabilities - - - (2,923) (2,923) - (2,923) - - - (2,923) (2,923) 1,930 (993) Balance as at December 31 5,051 1,066 (5,360) 255,618 256,375 50,527 306,902 Theaccompanyingnotesareanintegralpartoftheseconsolidatednancialstatements. 122 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Consolidatedstatementofcashows for the year ended December 31, 2021 x € 1,000 Note 2021 2020 Protfortheyearfromcontinuingoperations 54,574 40,638 Adjustments for: Taxation on the result 10 17,157 10,536 Shareofprotofassociates 15 (159) (305) Financial expenses 9 3,889 7,004 Depreciation and impairment of right-of-use assets 24 19,105 10,580 Depreciation and impairment of property, plant and equipment 14 9,616 9,157 Amortisation and impairment of goodwill and other intangible assets 12, 13 12,182 12,709 Provisions (365) 1,428 Non-cash share-based payment expense 20, 28 975 900 Other non-cash movements 1,104 (2,781) Operatingcashowsbeforemovementsinworkingcapital 118,078 89,866 Decrease / (increase) in inventory (73,490) 69,246 Decrease / (increase) in trade receivables 610 8,975 Decrease / (increase) in other tax receivables (5,728) (4,399) Decrease / (increase) in other receivables (3,310) 8,471 Increase / (decrease) in trade payables 4,124 (5,166) Increase / (decrease) in other taxes and social security charges (1,634) 161 Increase / (decrease) in other current liabilities (475) 551 Cash generated by operations 38,175 167,705 Income taxes paid (19,550) (13,915) Interest paid (3,840) (6,787) Net cash from operations 14,785 147,003 Theaccompanyingnotesareanintegralpartoftheseconsolidatednancialstatements. 123 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements x € 1,000 Note 2021 2020 Interest received 47 157 New loan to associates and third parties 16 - (392) Repayments on loans issued to associates 16 210 818 Netcashoutowonacquisitionofsubsidiaries 33 (11,234) (2,457) Payment for property, plant and equipment 14 (10,462) (7,411) Payment for intangible assets 13 (2,649) (6,073) Proceeds from disposals 274 122 Net cash from investing activities (23,814) (15,236) Repayments on loans from banks 23 (53,667) (11,932) Repayments on lease liabilities 24 (11,091) (9,966) New loans received from banks 23 175,700 3,000 New loans received from third parties 23 - 3,000 Paidtoprotsharecerticates - (371) Transaction costs related to loans and borrowings 23 (250) - Dividend paid to owners of the Company 21 (8,418) - Dividend paid to non-controlling interests 22 (11,986) (13,262) Changes in credit facilities (107,582) (114,249) Netcashfromnancingactivities (17,294) (143,780) Balance January 1, 38,870 50,884 Movement (26,323) (12,014) Balance December 31, 12,547 38,870 Theaccompanyingnotesareanintegralpartoftheseconsolidatednancialstatements. 124 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 2.1 New and amended IFRSs that are effective for the current year Impact of Covid-19-Related Rent Concessions beyond 30 June 2021 Amendment to IFRS 16 In May 2020, the IASB issued Covid-19-Related Rent Concessions (Amendment to IFRS 16) that provides practical relief to lessees in accounting for rent concessions occurring as a direct consequence of Covid-19, by introducing a practical expedient to IFRS 16. In March 2021 the practical expedient has been extended to 30 June 2022. The practical expedient permits a lessee to elect not to assess whether a Covid-19- relatedrentconcessionisaleasemodication.Alesseethatmakesthiselectionshall account for any change in lease payments resulting from the Covid-19-related rent concession the same way it would account for the change applying IFRS 16 if the changewerenotaleasemodication. The amendment is not relevant to the Group given that it has not obtained rent concessions occurring as a direct consequence of Covid-19. Amendments to IFRS Standards applicable to the Group In the current year, the Group has applied a number of amendments to IFRS Standards and Interpretations issued by the IASB that are effective for an annual period that begins on or after January 1, 2021. Their adoption has not had any material impact on the disclosuresorontheamountsreportedintheseconsolidatednancialstatements. 1 General 2 Adoption of new and revised International Financial Reporting Standards (“IFRS”) On January 1, 2021 several new and amended standards and interpretations became effective for annual periods beginning on or after January 1, 2021. The impact of these changesontheGroup’sconsolidatednancialstatementsisdescribedinthisnote. Notestotheconsolidatednancialstatements B&S Group S.A. (the “Company”) has its registered office at 14 Rue Strachen, Mensdorf, G.D. Luxembourg. B&S Group S.A. is a holding Company of an international conglomerate of companies (together referred to as the “Grou p”). A detailed list of the Group’s main subsidiaries is enclosed in the appendix on page 185. The consolidated financial statements of the Group for 2021 include the accounts of B&S Group S.A. and its subsidiaries, as well as the Company’s interests in associates. The official version of the Annual Report B&S Group S.A. which includes the consolidated financial statements is the European Single Electronic Format (ESEF) version available with the Officially Appointed Mechanism (OAM) tool. These consolidated financial statements are prepared in Euros, being the Company’s functional and reporting currency. All financial information in Euros is rounded to the nearest thousand. Foreign operations are included in accordance with the policies set out in note 3. 125 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Amendments to IAS 1 Classicationofliabilitiesascurrentor non-current Not yet endorsed Amendments to IAS 1 and IFRS Practice Statements 2 Disclosure of Accounting Policies Not yet endorsed Amendments to IAS 8 Disclosure of Accounting Estimates Not yet endorsed Amendments to IAS 12 Deferred Tax related to Assets and Liabilities arising from a Single Transaction Not yet endorsed IFRS 10 and IAS 28 (amendments) Sale or Contribution of Assets between an Investor and its Associate or Joint Venture Not yet endorsed The Group does not expect that the adoption of the Standards listed above will have a materialimpactontheconsolidatednancialstatementsoftheGroupinfutureperiods. 3 Signicantaccountingpolicies 3.1 Statement of compliance The2021consolidatednancialstatementshavebeenpreparedinaccordancewith International Financial Reporting Standards as adopted by the European Union (EU-IFRS). TheconsolidatednancialstatementswereapprovedbytheExecutiveBoardand authorised for issue on February 28, 2022. 3.2 Covid-19 The global outbreak of Covid-19 has affected the Group’s results, consolidated statement ofnancialpositionandcashowspresentedintheseconsolidatednancialstatements. Theimpactofthepandemiconspecicreportingareasisincludedinthedisclosure Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 (Interest Rate Benchmark Reform - Phase 2) The Group has adopted the amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 related to Interest Rate Benchmark Reform –Phase2,forthersttimeinthecurrentyear. Phase 2 amendments relate mainly to accounting for changes in the basisfordeterminingthecontractualcashowsofnancialassets andliabilitiesandmodicationinleasesduetotheIBORreformand impact on hedge accounting when an existing benchmark rate is reformed or replaced with an alternative risk free rate. The Group hasnotidentiedmaterialchangesinthecontractualcashowasa direct consequence of the reform or in case of a change in contractualcashow,thenewbasisfordeterminingthecontractual cashowiseconomicallyequivalenttothepreviousbasis.Therefor the adoption of this amendment has not led to additional disclosure requirements or retrospective. 2.2 New and revised IFRS standards in issue but not yet effective Atthedateofauthorisationoftheseconsolidatednancialstatements,theGrouphasnot applied the following relevant new and revised IFRS Standards that have been issued but are not yet effective (and, in some cases, have not yet been endorsed by the EU): Amendments to IAS 37 OnerousContracts–CostofFulllinga Contract Endorsed Improvements to IFRS 9, IFRS 16, IFRS 1, IAS 41 Annual Improvements to IFRS Standards 2018-2020 Endorsed Amendments to IAS 16 Property, Plant and Equipment – Proceeds before Intended Use Endorsed Amendments to IFRS 3 Reference to the Conceptual Framework Endorsed 126 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements EBITDA is one of the measures that the Executive Board uses to assess the performanceoftheGroupanditsoperatingsegments.EBITDAisdenedas‘Operating result’adjustedfor‘Depreciationandamortisation’. Netdebtisdenedasinterestbearingliabilitiesminuscashandcashequivalents. NetDebtspeciestheexposuretowardsbanksandotherlendersandisalsousedto measure compliance with bank covenants. Net Debt can be reconciled to the balance sheet as follows: x € 1,000 31.12.2021 31.12.2020 Lease liabilities due within one year 11,035 10,034 Loans and borrowings, current 59,925 178,130 Lease liabilities 58,344 56,698 Borrowings from banks 177,956 46,496 Cash and cash equivalents (12,547) (38,870) 294,713 252,488 3.5 Going concern Thedirectorshave,atthetimeofapprovingtheconsolidatednancialstatements, a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concernbasisofaccountinginpreparingtheconsolidatednancialstatements. notes with respect to these areas. Other reporting areas have also been impacted, butnotsignicantlyandarethereforenotseparatelydisclosed. 3.3 Basis of preparation Theconsolidatednancialstatementshavebeenpreparedonthehistoricalcostbasis, exceptfortherevaluationofcertainnancialinstrumentsthataremeasuredatfairvalues at the end of each reporting period, as explained in the accounting policies below. Historical cost is generally based on the fair value of the consideration given in exchange for goods and services. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Group takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these consolidated nancialstatementsisdeterminedonsuchabasis,exceptforshare-basedpayment transactions that are within the scope of IFRS 2, leasing transactions that are within the scope of IFRS 16, and measurements that have some similarities to fair value but are not fair value, such as net realisable value in IAS 2 or value in use in IAS 36. The principal accounting policies adopted are set out below. 3.4 Non-GAAP measures GrossProtMarginisusedtoprovideinsightinthegrossprotrealisedonthesaleof products to customers and as such used to measure performance of product lines, customergroupsandcompanies.Thegrossprotiscalculatedbydeductingthe purchasevalueofitemssoldfromtherealisedturnoverandgrossprotmarginby dividinggrossprotbyturnover. 127 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 3.7 Business combinations Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the Group, less liabilities incurred by the Group to the former owners of the acquiree and the equity interests issued by the Group in exchange for control of the acquiree. Acquisition-relatedcostsarerecognisedintheconsolidatedstatementofprotorlossas incurred. Attheacquisitiondate,theidentiableassetsacquiredandtheliabilitiesassumedare recognised at their fair value, except that: deferredtaxassetsorliabilitiesandassetsorliabilitiesrelatedtoemployeebenet arrangements are recognised and measured in accordance with lAS 12 and IAS 19 respectively; liabilities or equity instruments related to share-based payment arrangements of the acquiree or share-based payment arrangements of the Group entered into to replace share-based payment arrangements of the acquiree are measured in accordance with IFRS 2 at the acquisition date. Goodwill is measured as the fair value of the consideration transferred plus the recognised amount of any non-controlling interest in the acquiree less the net recognised amount(fairvalue)oftheidentiableassetsacquiredandliabilitiesassumed.If,after reassessment,thenetoftheacquisition-dateamountsoftheidentiableassetsacquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer’s previously held interest in the acquiree (if any), the excess is recognised immediately in the consolidatedstatementofprotorlossasabargainpurchasegain. When the consideration transferred by the Group in a business combination includes a contingent consideration arrangement, the contingent consideration is measured at its acquisition-date fair value and included as part of the consideration transferred in a 3.6 Basis of consolidation Theconsolidatednancialstatementsincorporatethenancialstatementsofthe Company and entities (including structured entities) controlled by the Company and its subsidiaries made up to December 31st each year. Control is achieved when the Company: has power over the investee; is exposed, or has rights, to variable returns from its involvement with the investee; and has the ability to use its power to affect its returns. The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes (none in 2021) to one or more of the three elements of control listed above. Consolidation of a subsidiary begins when the Company obtains control over the subsidiaryandceaseswhentheCompanylosescontrolofthesubsidiary.Specically, results of subsidiaries acquired or disposed of during the year are included in the consolidatedstatementofprotorlossfromthedatetheCompanygainscontroluntilthe date when the Company ceases to control the subsidiary. Protorlossandeachcomponentofothercomprehensiveincomeareattributedtothe owners of the Company and to the non-controlling interests. Total comprehensive income of the subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a decitbalance. In case of incorporation and liquidation of a Company, the consolidation of a subsidiary begins as from the date of incorporation and the Company controls the investee and the consolidation terminates as from the date of liquidation. 128 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements indication that the unit may be impaired. If the recoverable amount of the cash- generating unit is less than the carrying amount of the unit, the impairment loss is allocatedrsttoreducethecarryingamountofanygoodwillallocatedtotheunitand then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit. An impairment loss recognised for goodwill is not reversed in a subsequent period. On disposal of the relevant cash-generating unit, the attributable amount of goodwill is includedinthedeterminationoftheprotorlossondisposal. The Group’s policy for goodwill arising on the acquisition of associates is described below. 3.9 Investments in associates AnassociateisanentityoverwhichtheGrouphassignicantinuence.Signicant inuenceispresumedtoexistwhentheGroupholdsmorethan20%ofthevotingpower of the entity. Associatesareaccountedforusingtheequitymethodfromthedatethatsignicant inuencecommencesuntilthedatethatsignicantinuenceceases.Initially, investmentsinassociatesarerecognisedatcost.Goodwillidentiedontheacquisitionof the associate is included in the carrying amount of the investment. When the Group’s share of losses of an associate exceeds the Groups interests in that associate, the Group discontinues recognising its share of further losses. Additional losses are recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate. TheconsolidatednancialstatementsincludetheGroup’sshareofthenetprotorloss and other comprehensive income of the associates, after adjustments to align the accounting policies with those of the Group. business combination. Changes in fair value of the contingent consideration that qualify as measurement period adjustments are adjusted retrospectively, with corresponding adjustments against goodwill. Measurement period adjustments are adjustments that arisefromadditionalinformationobtainedduringthe‘measurementperiod’(which cannot exceed one year from the acquisition date) about facts and circumstances that existed at the acquisition date. The subsequent accounting for changes in the fair value of the contingent consideration that do not qualify as measurement period adjustments depends on how the contingent considerationisclassied.Contingentconsiderationthatisclassiedasequityisnot remeasured at subsequent reporting dates and its subsequent settlement is accounted for within equity. Other contingent consideration is remeasured to fair value at subsequent reporting dates with changes in fair value recognised in the consolidated statementofprotorloss. lf the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Group reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period (see above), or additional assets or liabilities arerecognised,toreectnewinformationobtainedaboutfactsandcircumstancesthat existed at the acquisition date that, if known, would have affected the amounts recognised at that date. The accounting for business combinations realised in 2021 has been completed. 3.8 Goodwill Goodwill is initially recognised and measured as set out above. Goodwill is not amortised but is reviewed for impairment at least annually. For the purpose of impairment testing, goodwill is allocated to each of the Group’s cash- generatingunits(orgroupsofcash-generatingunits)expectedtobenetfromthe synergies of the combination. Cash-generating units to which goodwill has been allocated are tested for impairment annually, or more frequently when there is an 129 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements itisprobablethattheeconomicbenetsassociatedwiththetransactionwillowto the Group; and the costs incurred or to be incurred in respect of the transaction can be measured reliably. Right of return Our sales to end-customers have a right of return policy which is compliant with the local laws and regulations for consumer sales. In general terms the customers have a 30 day right of return. The expected return rates are being based on the actual return rates in the (recent) past periods. Based thereon the expected sales return is being determined and a refund liability for the amounts expected to be refunded is matched and recognised in the appropriate corresponding period. The right to receive the corresponding products in return is accounted for as far as the corresponding amount is material. Rendering of services Revenue from a contract for providing services, comprising logistical services related to the sold goods, is recognised at the same moment when the underlying sale of goods is recognised. 3.11 Purchase value Purchase value represents the purchase price of trade inventory, including additional costs such as incoming freight, handling and other charges directly attributable to the purchase and/or sale of the goods and write-downs of inventories. The purchase price is net of discounts and supplier bonuses. 3.12 Leases The Group assesses whether a contract is or contains a lease, at inception of the contract. A contract is, or contains, a lease if the contract conveys the right to control the useofanidentiedassetfortheperiodoftimeinexchangeforconsideration.TheGroup recognises a right-of-use asset and a corresponding lease liability with respect to all lease arrangementsinwhichitisthelessee,exceptforshort-termleases(denedasleases 3.10 Revenue recognition The Group recognises revenue from the following major sources: Distribution of liquors, health and beauty products to wholesalers, specialty retailers and online end-customers; Specialty distribution of food, beverages, health and beauty products to maritime, remote and retail business to business markets; Specialty distribution of medical supplies to maritime and remote markets, pharmacies and travel clinics; Specialtyretailwithconsumergoodsathightrafcairportsandremotelocations. Revenue is measured based on the consideration to which the Group expects to be entitled in a contract with a customer and excludes amounts collected on behalf of third parties. The Group recognises revenue when it transfers control of a product or service to a customer. Revenue from the sale of goods Revenue from the sale of goods is recognised when control of the goods has transferred, atwhichtimeallthefollowingconditionsaresatised: theperformanceobligationhasbeensatisedbytheGroup; the Group has transferred physical possession/control of the goods to the customer; theGrouphastransferredthesignicantrisksandrewardsrelatedtotheownership of the goods to the customer; the Group has a present right to payment for the goods delivered, whereby it should benotedthatnancingcomponentsarenotincludedintheGroup’ssalescontracts; the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold; the amount of revenue can be measured reliably (it is noted that variable considerations hardly occur within the Group); 130 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Aleasecontractismodiedandtheleasemodicationisnotaccountedforasa separate lease, in which case the lease liability is remeasured based on the lease termofthemodiedleasebydiscountingtherevisedleasepaymentsusinga reviseddiscountrateattheeffectivedateofthemodication. The right-of-use assets comprise the initial measurement of the corresponding lease liability, lease payments made at or before the commencement day, less any lease incentives received and any initial direct costs. They are subsequently measured at cost less accumulated depreciation and impairment losses. Right-of-use assets are depreciated over the shorter period of lease term and useful life of the underlying asset. If a lease transfers ownership of the underlying asset or the cost oftheright-of-useassetreectsthattheGroupexpectstoexerciseaunilateralpurchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset. The depreciation starts at the commencement date of the lease. The right-of-use assets are presented as a separate line in the consolidated statement of nancialposition. The Group applies IAS 36 to determine whether a right-of-use asset is impaired and accountsforanyidentiedimpairmentlossasdescribedinthe‘Property,Plantand Equipment’ policy. As a practical expedient, IFRS 16 permits a lessee not to separate non-lease components, and instead account for any lease and associated non-lease components as a single arrangement. The Group has not applied this practical expedient. For contracts that contain a lease component and one or more additional lease or non-lease components, the Group allocates the consideration in the contract to each lease component on the basis of the relative stand-alone price of the lease component and the aggregate stand-alone price of the non-lease components. with a lease term of twelve months or less) and leases of low value assets . For these leases, the Group recognises the lease payments as an operating expense on a straight- line basis over the term of the lease. The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the Group uses its incremental borrowing rate. The incremental borrowing rate applied to the lease liabilities on December 31, 2021 was 1.7%(December31,2020:1.7%). Lease payments included in the measurement of the lease liability comprise: Fixedleasepayments(includingin-substancexedpayments),lessanylease incentives receivable; The amount expected to be payable by the lessee under residual value guarantees; Paymentsofpenaltiesforterminatingthelease,iftheleasetermreectsthe exercise of an option to terminate the lease. Theleaseliabilityissubsequentlymeasuredbyincreasingthecarryingamounttoreect interest on the lease liability (using the effective interest method) and by reducing the carryingamounttoreecttheleasepaymentsmade.Theleaseliabilityispresentedasa separatelineintheconsolidatedstatementofnancialposition. The Group remeasures the lease liability (and makes a corresponding adjustment to the related right-of-use asset) whenever: The lease term has changed. The lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed residual value, in which cases the lease liability is remeasured by discounting the revised lease payments using an unchanged discount rate (unless the lease payments change is due to a change in aoatinginterestrate,inwhichcaseareviseddiscountrateisused). 131 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements salaries,socialsecuritycharges,andotherxedcostincurredbytheGroup.TheGroup hasaccountedfortheseprogramsinaccordancewithIAS20‘Accountingfor Government Grants and Disclosure of Government Assistance’. Government grants are not recognised until there is reasonable assurance that the Group will comply with the conditions attaching to them and that the grants will be received. Since the Group complies with all the conditions as at December 31, 2021 and 2020 attached to the government grants and the grants were already received and could be matched with the related cost in 2021 and 2020 which they are intended to compensate, the grants have as such been recognised. An amount of € 0.2 million has been recognised as a liability (to be repaid). For further details, reference is made to note 7 and 8. 3.15 Employeebenets Share-based payment arrangements A group of managers has received a share incentive plan, which are settled in equity. Annually, an equal amount will be recognised as an expense during the vesting period. Reference is made to note 20 for more details on the share-based payment. The fair value of the amount payable to employees in respect of share appreciation rights (SARs), which are settled in cash, is recognised as an expense with a corresponding increase in liabilities, over the period during which the employees become unconditionally entitled to payment. The liability is remeasured at each reporting date and at settlement date based on the fair value of the SARs. Any changes in the liability arerecognisedinprotorloss.Referenceismadetonote28formoredetailsonthe share-based payment arrangements. Dened contribution plans Paymentstodenedcontributionretirementbenetplansarerecognisedasanexpense when employees have rendered service entitling them to the contributions. The Group 3.13 Foreign currencies Foreign currency transactions lnpreparingthenancialstatementsofeachindividualGroupentity,transactionsin currencies other than the entity’s functional currency (foreign currencies) are recognised at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items measured at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are translated at the rates prevailing at that date of the transaction. Exchange differences on monetary items are recognised in the consolidated statement ofprotorlossintheperiodinwhichtheyarise,exceptforexchangedifferenceson transactions entered into in order to hedge certain foreign currency risks. Foreign operations Forthepurposeofpresentingtheseconsolidatednancialstatements,theassetsand liabilities of the Group’s foreign operations are translated into Euro using exchange rates prevailing at the end of each reporting period. Income and expense items are translated attheaverageexchangeratesfortheperiod,unlessexchangeratesuctuate signicantlyduringthatperiod,inwhichcasetheexchangeratesatthedatesofthe transactions are used. Exchange differences arising, if any, are recognised in other comprehensive income and accumulated in a foreign exchange translation reserve, except to the extent that the translation difference is allocated to non-controlling interests. 3.14 Government grants In various countries within Europe, governments have initiated a wide variety of employmentprotectionprogramsandxedcostcompensationfollowingtheCovid-19 outbreak and related economic downturn. These programs compensate for part of the 132 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Interest income or expense is recognised using the effective interest method. The ‘effectiveinterestrate’istheratethatdiscountsestimatedfuturecashpaymentsor receiptsthroughtheexpectedlifeofthenancialinstrumentto: thecarryingamountofthenancialasset;or theamortisedcostofthenancialliability. In calculating interest income and expense, the effective interest rate is applied to the gross carrying amount of the asset or to the amortised cost of the liability. 3.17 Taxation Income tax expense represents the sum of the tax currently payable and deferred tax. Current tax Thetaxcurrentlypayableisbasedontaxableprotfortheyear.Taxableprotdiffers from‘protbeforetax’asreportedintheconsolidatedstatementofprotorlossbecause of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted by the end of the reporting period. Deferred tax Deferred tax is the tax expected to be payable or recoverable on differences between the carryingamountsofassetsandliabilitiesintheconsolidatednancialstatementsandthe correspondingtaxbasesusedinthecomputationoftaxableprot,andisaccountedfor using the liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probablethattaxableprotswillbeavailableagainstwhichdeductibletemporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from the initial recognition (other than in a business combination) of assetsandliabilitiesinatransactionthataffectsneitherthetaxableprotnorthe operatesvariouspensionschemes.Theseschemesarenancedthroughpaymentsto insurance companies, industry branch pension funds or the collective pension funds. The industry pension funds are treated as multi-employer pension funds as the plans are collectively negotiated by multiple employers and labour unions. Reference is made to note26formoredetailsontheretirementandterminationbenets. Short-term and other long-term employee benets Aliabilityisrecognisedforbenetsaccruingtoemployeesinrespectofwagesand salaries, annual leave and sick leave in the period the related service is rendered. Liabilitiesrecognisedinrespectofshort-termemployeebenetsaremeasuredatthe undiscountedamountofthebenetsexpectedtobepaidinexchangefortherelated service. Liabilitiesrecognisedinrespectofotherlong-termemployeebenetsaremeasuredat thepresentvalueoftheestimatedfuturecashoutowsexpectedtobemadebythe Group in respect of services provided by employees up to the reporting date. 3.16 Financial expenses TheGroup’snancialexpensesinclude: interest expense; interest on lease liabilities; theforeigncurrencygainorlossonnancialassetsandnancialliabilities; changes in the fair value of derivatives; changesinthefairvalueoncontingentconsiderationclassiedasanancial liability; 133 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 3.18 Intangible assets other than goodwill Intangible assets acquired separately Intangibleassetswithniteusefullivesthatareacquiredseparatelyarecarriedatcost less accumulated amortisation and accumulated impairment losses, if any. Amortisation is recognised on a straight-line basis over their estimated useful lives which are disclosed in note 13. The estimated useful life and amortisation method are reviewed at the end of each reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. Intangible assets acquired in a business combination Intangible assets acquired in a business combination and recognised separately from goodwill are initially recognised at their fair value at the acquisition date (which is regarded as their cost). Subsequent to initial recognition, intangible assets acquired in a business combination are reported at cost less accumulated amortisation and accumulated impairment losses, on the same basis as intangible assets that are acquired separately. Derecognition of intangible assets Anintangibleassetisderecognisedondisposal,orwhennofutureeconomicbenets are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the carryingamountoftheasset,arerecognisedintheconsolidatedstatementofprotor loss when the asset is derecognised. Impairment of intangible assets At each reporting date, the Group reviews the carrying amounts of its intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. accountingprot.Inaddition,adeferredtaxliabilityisnotrecognisedifthetemporary difference arises from the initial recognition of goodwill. The carrying amount of deferred tax assets is reviewed at each reporting date and reducedtotheextentthatitisnolongerprobablethatsufcienttaxableprotswillbe available to allow all or part of the asset to be recovered. Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. Themeasurementofdeferredtaxliabilitiesandassetsreectsthetaxconsequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same tax authority and the Group intends to settle its current tax assets and liabilities on a net basis. Current and deferred tax for the year Currentanddeferredtaxarerecognisedintheconsolidatedstatementofprotorloss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity respectively. Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination. 134 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 3.20 Inventories Inventories are stated at the lower of cost and net realisable value. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. Costs of inventoriesaredeterminedbasedonarst-in-rst-outapproach.Netrealisablevalue represents the estimated selling price less all estimated costs to be incurred in marketing, selling and distribution. 3.21 Financial instruments Financial assets Financial assets are recognised when a Group entity becomes a party to the contractual provisionsofanancialinstrument.Financialassetsarederecognisedwhentherightsto receivecashowsfromthenancialassetsexpire,oriftheGrouptransfersthenancial asset to another party and does not retain control of the asset. Purchases and sales of nancialassetsinthenormalcourseofbusinessareaccountedforatsettlementdate (i.e., the date the asset is delivered). Atinitialrecognition,theGroupmeasuresitsnancialassetsatfairvalue.Allrecognised nancialassetsaremeasuredsubsequentlyintheirentiretyateitheramortisedcostor fairvalue,dependingontheclassicationofthenancialassets. Classicationofnancialassets Debt instruments that meet the following conditions are measured subsequently at amortised cost: thenancialassetisheldwithinabusinessmodelwhoseobjectiveistohold nancialassetsinordertocollectcontractualcashows;and thecontractualtermsofthenancialassetgiveriseonspecieddatestocash owsthataresolelypaymentsofprincipalandinterestontheprincipalamount outstanding. 3.19 Property, plant and equipment Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses. Depreciation is recognised based on the cost or valuation of assets (other than freehold land) less their residual values over their useful lives, using the straight-line method, on the following bases: Property 5%perannum Equipment 10%-20%perannum Other 12.5%-20%perannum The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis. Right-of-use assets are depreciated over the shorter period of the lease term and the useful life of the underlying asset. If a lease transfers ownership of the underlying asset orthecostoftheright-of-useassetreectsthattheGroupexpectstoexercisea purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset. An item of property, plant and equipment is derecognised upon disposal or when no futureeconomicbenetsareexpectedtoarisefromthecontinueduseoftheasset. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amountoftheassetandisrecognisedintheconsolidatedstatementofprotorloss. At each reporting date, the Group reviews the carrying amounts of its property, plant and equipment to determine whether there is any indication that those assets have suffered an impairment loss. 135 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements the carrying amount of the allowance account are recognised in the consolidated statementofprotorloss. The measurement of expected credit losses is a function of the probability of default, loss given default (i.e. the magnitude of the loss if there is a default) and the exposure at default. The assessment of the probability of default and loss given default is based on historical data adjusted by forward-looking information as described above. As for the exposureatdefault,fornancialassets,thisisrepresentedbytheassets’grosscarrying amount at the reporting date. Financial liabilities Financial liabilities are recognised when the Group becomes a party to the contractual provisionsofanancialinstrument.Financialliabilitiesarederecognisedwhenthe Group’sobligationsspeciedinthecontractexpireoraredischargedorcancelled. TheGroupalsoderecognisesanancialliabilitywhenitstermsaremodiedandthe cashowsofthemodiedliabilityaresubstantiallydifferent,inwhichcaseanew nancialliabilitybasedonthemodiedtermsisrecognisedatfairvalue. Onderecognitionofanancialliability,thedifferencebetweenthecarryingamount extinguishedandtheconsiderationpaidisrecognisedinprotorloss. Financial liabilities are initially recognised, they are measured at their fair value. Allnancialliabilitiesaremeasuredsubsequentlyatamortisedcostusingtheeffective interest rate method, except for derivatives and contingent considerations, which are measured at FVTPL. Financial liabilities at FVTPL are stated at fair value, with any gains orlossesarisingonremeasurementrecognisedintheconsolidatedstatementofprotor loss. Fair value is determined in the manner described in note 31. Derivative nancial instruments TheGroupfrequentlyentersintoderivativenancialinstrumentstomanageitsexposure to interest rate and foreign exchange rate risks. During the year that ended December 31, 2021,nomaterialderivativenancialinstrumentswereenteredintobyTheGroup. Debt instruments that meet the following conditions are measured subsequently at fair value through other comprehensive income (FVTOCI): thenancialassetisheldwithinabusinessmodelwhoseobjectiveisachievedby bothcollectingcontractualcashowsandsellingthenancialassets;and thecontractualtermsofthenancialassetgiveriseonspecieddatestocash owsthataresolelypaymentsofprincipalandinterestontheprincipalamount outstanding. Bydefault,allothernancialassetsaremeasuredsubsequentlyatfairvaluethrough protorloss(FVTPL). TheGrouponlyhasnancialassetsclassiedasdebtinstrumentsmeasured subsequently at amortised cost (amongst others trade and other receivables) except for a few derivatives that are measured at FVTPL. Financial assets at FVTPL are measured at fair value at the end of each reporting period, with any fair value gains or losses recognised in the consolidated statement of protorlosstotheextenttheyarenotpartofadesignatedhedgingrelationship. Fair value is determined in the manner described in note 31. Impairmentofnancialassets The Group recognises a loss allowance for expected credit losses on investments in debt instruments that are measured at amortised cost. The amount of expected credit losses isupdatedateachreportingdatetoreectchangesincreditrisksinceinitialrecognition oftherespectivenancialinstrument. Thecarryingamountofthenancialassetisreducedbytheimpairmentlossdirectlyfor allnancialassetswiththeexceptionoftradereceivables,wherethecarryingamountis reduced through the use of an allowance account based on the expected lifetime losses followingthesimpliedapproachasperIFRS9.Whenatradereceivableisconsidered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in 136 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements At the inception of the hedge relationship, the Group documents the relationship between the hedging instrument and the hedged item, along with its risk management objectives and its strategy for undertaking various hedge transactions. Furthermore, at the inception of the hedge and on an ongoing basis, the Group documents whether the hedging instrumentiseffectiveinoffsettingchangesinfairvaluesorcashowsofthehedged item attributable to the hedged risk, which is when the hedging relationship meets all of the following hedge effectiveness requirements: there is an economic relationship between the hedged item and the hedging instrument; the effect of credit risk does not dominate the value changes that result from that economic relationship; and the hedge ratio of the hedging relationship is the same as that resulting from the quantity of the hedged item that the Group actually hedges and the quantity of the hedging instrument that the Group actually uses to hedge that quantity of hedged item. If a hedging relationship ceases to meet the hedge effectiveness requirement relating to the hedge ratio but the risk management objective for that designated hedging relationship remains the same, the Group adjusts the hedge ratio of the hedging relationship (i.e. rebalances the hedge) so that it meets the qualifying criteria again. Cash ow hedges The effective portion of changes in the fair value of derivatives and other qualifying hedginginstrumentsthataredesignatedandqualifyascashowhedgesisrecognised inothercomprehensiveincomeandaccumulatedundertheheadingofcashow hedging reserve, limited to the cumulative change in fair value of the hedged item from inception of the hedge. The gain or loss relating to the ineffective portion is recognised immediatelyintheconsolidatedstatementofprotorloss,andisincludedinthe ‘nancialexpenses’lineitem. Derivatives are initially recognised at fair value at the date the derivative contracts are entered into and are subsequently remeasured to their fair value at the end of the reporting period. The resulting gain or loss is recognised in the consolidated statement of protorlossimmediatelyunlessthederivativeisdesignatedandeffectiveasahedging instrument, in which event the timing of the recognition in the consolidated statement of protorlossdependsonthenatureofthehedgerelationship. Aderivativewithapositivefairvalueisrecognisedasanancialassetwhereasa derivativewithanegativefairvalueisrecognisedasanancialliability.Derivativesare notoffsetintheconsolidatednancialstatementsunlesstheGrouphasbothalegally enforceable right and intention to offset. A derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the instrument is more than 12 months and it is not due to be realised or settled within 12 months. Other derivatives are presented as current assets or current liabilities. Equity instruments An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued by a Group entity are recognised at the proceeds received, net of direct issue costs. Repurchase of the Company’s own equity instruments is recognised and deducted directly in equity. Nogainorlossisrecognisedintheconsolidatedstatementofprotorlossonthe purchase, sale, issue or cancellation of the Company’s own equity instruments. 3.22 Hedge accounting TheGroupdesignatescertainnancialinstrumentsashedginginstrumentsinrespectof foreigncurrencyriskincashows.Hedgesofforeignexchangeriskonrm commitmentsareaccountedforascashowhedges.Fairvaluehedgesandhedgesof net investments in foreign operations are not applied by the Group. 137 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Whensomeoralloftheeconomicbenetsrequiredtosettleaprovisionareexpectedto be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably. 4 Critical accounting judgements and key sources of uncertainty In the application of the Group’s accounting policies, which are described in note 3, the Group is required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant, such as the impact of the global Covid-19pandemicontheGroups’expectedfuturecashowsandresults.Actualresults may differ from these estimates. The estimates and underlying assumptions are reviewed on ongoing bases. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. The key assumptions concerning the future, and other key sources of estimation uncertaintyattheendofthereportingperiodthatmayhaveasignicantriskofcausinga material adjustment to the carrying amounts of assets and liabilities within the next nancialyear,aredescribedbelow. Amounts previously recognised in other comprehensive income and accumulated in equityarereclassiedtotheconsolidatedstatementofprotorlossintheperiodswhen thehedgeditemaffectsprotorloss,inthesamelineastherecognisedhedgeditem. Furthermore, if the Group expects that some or all of the loss accumulated in the cash owhedgingreservewillnotberecoveredinthefuture,thatamountisimmediately reclassiedtotheconsolidatedstatementofprotorloss. The Group discontinues hedge accounting only when the hedging relationship (or a part thereof) ceases to meet the qualifying criteria (after rebalancing, if applicable). This includes instances when the hedging instrument expires or is sold, terminated or exercised. The discontinuation is accounted for prospectively. Any gain or loss recognisedinothercomprehensiveincomeandaccumulatedincashowhedgereserve atthattimeremainsinequityandisreclassiedtotheconsolidatedstatementofprotor loss when the forecast transaction occurs. When a forecast transaction is no longer expectedtooccur,thegainorlossaccumulatedinthecashowhedgereserveis reclassiedimmediatelytotheconsolidatedstatementofprotorloss. Movements in the hedging reserve in equity are detailed in note 21. 3.23 Provisions Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using thecashowsestimatedtosettlethepresentobligation,itscarryingamountisthe presentvalueofthosecashows(whentheeffectofthetimevalueofmoneyis material). 138 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 5 Segment reporting Theoperatingsegmentsareidentiedandreportedonthebasisofinternalmanagement reporting as provided to the Executive Board and Supervisory Board (which are the Chief Operating Decision Makers) to facilitate strategic decision-making, resource allocationandtoassessperformance.TheGrouphasidentiedthefollowingreportable segments, that jointly form the Group’s strategic divisions B&S Liquors, B&S Beauty, B&S Personal Care, B&S Food, B&S Health and B&S Retail. B&S Liquors is active as a global distributor of branded premium liquors to wholesalers, e-commerce platforms and consumers. B&S Liquors has its headquarters in Delfzijl, the Netherlands. B&S Beauty mainly distributes and sells branded premium fragrances and cosmetics to consumers, wholesalers and e-commerce platforms. B&S Beauty has its headquarters in Delfzijl, the Netherlands. B&S Personal Care distributes and sells branded premium personal and home care products to mainly value retailers. B&S Personal Care has its headquarters in Oud-Beijerland, the Netherlands. B&S Food is active as a specialty distributor for a wide range of branded premium food and beverages to duty-free, remote, retail and maritime markets. B&S Food has its headquarters in Dordrecht, the Netherlands. B&S Health distributes and sells branded premium medical products and equipment to maritime and remote markets, pharmacies and travel clinics. B&S Health has its headquarters in Dordrecht, the Netherlands. B&S Retail operates retail stores at international airports, regional airports and other ‘awayfromhome’locations,whereitsellsbrandedpremiumconsumerelectronicsand multi-category assortments. B&S-Retail has its headquarters in Hoofddorp, the Netherlands. Impairment testing Following the assessment of the recoverable amount of goodwill allocated to the operating segments, the Group considers the recoverable amount of goodwill to be most sensitivetotheachievementofthebudgetedfuturecashows.Thesensitivityanalysisin respect of the recoverable amount of goodwill is presented in note 12. Useful lives of tangible xed assets The Group assesses the estimated useful lives of property, plant and equipment at the end of each reporting period. During the current year, the Group has not determined any shortening of the useful lives of the property, plant and equipment. Valuation of right-of-use assets TheGroupevaluateswhether(signicantpartsof)leasedpropertyisnotinuseinorder to determine whether right-of-use assets could be subject to an impairment. Useful lives of other intangible xed assets The useful lives are assessed at the end of every reporting period. The other intangible assets mainly consist of concessions, customer/supplier relationships and brand names. Allowance for doubtful debts The allowance for doubtful debts is based on the expected lifetime losses following the simpliedapproachasperIFRS9.Estimationsandassumptionsareappliedto determinethesizeoftheallowance.Wheretheactualfuturecashowsbasedonthese estimations and assumptions are less than expected, a material effect on this allowance may arise. Provision for obsolescence of inventory The provision for obsolescence of inventory is based on the Group’s best estimates taking into account the market conditions and expectations on these market conditions. Ifmarketconditionssignicantlychangeduringthecomingyearsthismayhavea material effect on the provision. 139 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements x € 1,000 2021 2020 * Turnover B&S Liquors 540,867 575,520 B&S Beauty 675,727 646,090 B&S Personal Care 276,447 262,607 B&S Food 287,195 277,854 B&S Health 46,738 55,153 B&S Retail 42,518 44,532 Holdings & Eliminations 15 4 1,869,507 1,861,760 Gross prot B&S Liquors 56,920 36,642 B&S Beauty 126,695 115,606 B&S Personal Care 46,271 44,291 B&S Food 36,173 37,562 B&S Health 7,941 10,303 B&S Retail 11,834 8,471 Holdings & Eliminations 1,467 2,016 287,301 254,891 EBITDA B&S Liquors 28,175 12,888 B&S Beauty 62,362 65,400 B&S Personal Care 25,257 22,685 B&S Food 3,112 3,916 B&S Health 1,942 4,661 B&S Retail (1,541) (11,974) Holdings & Eliminations (2,943) (7,257) 116,364 90,319 Theactivitiesoftheholdingcompaniesaregroup-wideactivitiesincludingnance,ICT, human resource management and marketing. Costs incurred at Group level for business units have been allocated as much as possible to the operating segments. The results of the holding activities are separately reported to the Executive Board and are present on theline‘Holding&Eliminations’. A summary of the results of the reportable segments is provided on the next pages. The Chief Operating Decision Makers assess the performance of the operating segments on the basis of the EBITDA from ordinary activities. The accounting policies applied by the operating segments are identical to those of the Group described in note 3. The EBITDA from ordinary activities per segment include the costs allocated at the Group level. Transactions between segments are at arm’s length. Asfrom2021,thesegmentshavebeenredenedtotheaboveidentiedsegmentsand subsequently the description has been updated in line with the rebranding of B&S. Thenewsegmentstructureisinlinewiththenewoperatingsegmentsasidentiedand reported on the basis of internal management reporting as provided to the Executive Board and Supervisory Board. * The comparative information has been re-presented due the new segment structure as per January 1, 2021. 140 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements x € 1,000 31.12.2021 31.12.2020 * Total liabilities B&S Liquors 207,559 246,948 B&S Beauty 232,201 209,447 B&S Personal Care 73,227 88,263 B&S Food 152,453 225,007 B&S Health 17,820 12,819 B&S Retail 30,942 26,825 Holdings & Eliminations (159,757) (308,726) 554,445 500,583 6 Turnover The revenue per product group is as follows: x € 1,000 2021 2020 Liquors 551,994 587,437 Beauty 675,727 644,688 Personal Care 276,447 262,565 Food 292,230 288,933 Health 46,738 55,152 Electronics 26,371 22,985 1,869,507 1,861,760 x € 1,000 2021 2020 * Result before taxation B&S Liquors 24,721 6,726 B&S Beauty 54,002 53,678 B&S Personal Care 19,687 16,696 B&S Food (15,009) (4,937) B&S Health 209 2,936 B&S Retail (2,960) (15,180) Holdings & Eliminations (8,919) (8,745) 71,731 51,174 x € 1,000 31.12.2021 31.12.2020 * Total assets B&S Liquors 253,935 299,012 B&S Beauty 373,871 366,348 B&S Personal Care 141,103 144,708 B&S Food 224,020 302,791 B&S Health 30,819 25,665 B&S Retail 43,301 43,974 Holdings & Eliminations (209,332) (375,013) 857,716 807,485 * The comparative information has been re-presented due the new segment structure as per January 1, 2021. 141 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Thenumberofemployeesinfulltimeequivalentscanbespeciedasfollows: 2021 2020 * B&S Liquors 99 85 B&S Beauty 470 402 B&S Personal Care 212 211 B&S Food 347 442 B&S Health 78 76 B&S Retail 187 274 Holdings & Eliminations 321 260 1,714 1,750 * The comparative information has been re-presented due the new segment structure as per January 1, 2021. Please note that the fulltime equivalents for acquired companies are included on a pro rata basis as from the closing date onwards, in line with the staff costs in the statement of protorloss. Thedistributionofturnoveroverthegeographicalregionscanbespeciedasfollows: x € 1,000 2021 2020 Europe 1,002,004 929,688 America 360,127 333,191 Asia 293,991 352,366 Middle East 139,710 180,402 Africa 61,382 51,052 Oceania 12,293 15,061 1,869,507 1,861,760 7 Personnel costs Thedistributionofthepersonnelcostscanbespeciedasfollows: x € 1,000 2021 2020 Salary costs 87,121 85,639 Social security charges 10,623 10,783 Pension costs 4,615 4,680 Government grants (700) (2,693) Equity-settled share based payments 900 900 Cash-settled share based payments 75 - Other personnel costs 5,400 5,849 108,034 105,158 Temporary staff 9,576 10,591 117,610 115,749 The remuneration of the Executive Board and the Supervisory Board is disclosed in the note on related parties (refer to note 32). 142 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 9 Financial expenses Thenancialexpensescanbespeciedasfollows: x € 1,000 2021 2020 Interest related to bank facilities 3,478 5,176 Interest on lease liabilities 1,139 1,230 Currency exchange results (745) 379 Other interest 332 232 Changes in the fair value of derivatives (124) 134 Changes in the fair value of contingent considerations (191) (147) 3,889 7,004 10 Taxation on the result Thetaxationontheresultcanbespeciedasfollows: x € 1,000 2021 2020 Income tax current period 18,317 13,196 Income tax previous periods 67 366 Deferred taxes (1,227) (3,026) 17,157 10,536 8 Other operating expenses Theotheroperatingexpensescanbespeciedasfollows: x € 1,000 2021 2020 Personnel related costs 4,067 3,162 Ofce/warehousecosts 9,036 8,696 Marketing costs 3,961 2,963 ICT costs 17,227 12,295 Insurance costs 4,265 4,074 External advisory costs 7,100 8,699 Other operating expenses 7,671 8,934 53,327 48,823 During2021,theGrouprepaid€121,000forreceivedcompensationforxedcostsas part of local Covid-19 support programs. In 2020 an amount of € 400,000 has been receivedascompensationforxedcosts. ThefeesofDeloittethataredirectlyattributabletothenancialyearoftheGroupare incorporatedinthe‘Externaladvisorycosts’andspeciedasfollows: x € 1,000 Deloitte Audit S.à r.l. Other Deloitte member rms Total Deloitte Audit fees for statutory audits 151 1,416 1,567 Other non-audit services - 27 27 151 1,443 1,594 143 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements The diluted earnings per share are equal to the basic earnings per share. The earnings and weighted average number of ordinary shares used in the calculation of basic earnings per share are as follows: 2021 2020 ProtfortheyearattributabletoOwnersof the Company ( x € 1,000) 38,471 21,697 Weighted average number of ordinary shares (x 1) 84,177,321 84,177,321 12 Goodwill Themovementscanbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 62,337 65,656 Acquired in business combinations - 283 Impairment loss (500) - Foreign currency translation 3,255 (3,602) Balance as at December 31, 65,092 62,337 The following table shows the reconciliation between the nominal and effective corporate income tax rates for the Group: x € 1,000 2021 2020 Result before taxation 71,731 51,174 Shareofprotofassociates (159) (305) Non-deductible amortisation 7,246 8,116 Income not subject to income tax or charged with0%incometax (3,678) (1,113) 75,140 57,872 Blendedtaxchargerangingfrom12.5%to 32.0% 18,317 13,196 11 Earnings per share Thebasicearningspersharecanbespeciedasfollows: x € 1 2021 2020 Basic earnings per share from continuing operations 0.46 0.26 144 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Value in use calculation and main assumptions applied B&S Liquors The recoverable amounts of the cash-generating unit is determined based on a value in usecalculationwhichusescashowprojectionsbasedonnancialbudgetsand nanciallong-termplansapprovedbytheExecutiveBoardcoveringave-yearperiod, and a discount rate of 7.4 per cent per annum (2020: 7.5 per cent per annum). Increases in market volume (due to increase of population and rising consumption) have been taken into consideration as well as the scarcity of products, growing market pressure on prices, government-induced or otherwise. Assumptions for average selling prices and cost of sales are based on historical experience and expectations of future changes in themarket.Cashowsbeyondtheve-yearperiodhavebeencalculatedusingasteady 0.5 per cent (2020: 0.5 per cent) terminal growth rate. This growth rate does not exceed theinationrateformarketsintheterritoriesB&Soperatesin.Company’sassumptions used in the recoverable amount calculations, such as capital expenditure and other assumptions are inherently uncertain and may ultimately differ from actual amounts. The impairment testing for 2021 did not result in impairments for this CGU (2020: nil). B&S Beauty The recoverable amounts of the cash-generating unit is determined based on a value in usecalculationwhichusescashowprojectionsbasedonnancialbudgetsand nanciallong-termplansapprovedbytheExecutiveBoardcoveringave-yearperiod, and a discount rate of 8.1 per cent per annum (2020: 7.5 per cent per annum). Increases in market volume (due to increase of population and rising consumption) have been taken into consideration as well as the scarcity of products, growing market pressure on prices, government-induced or otherwise. Assumptions for average selling prices and cost of sales are based on historical experience and expectations of future changes in themarket.Cashowsbeyondtheve-yearperiodhavebeencalculatedusingasteady 0.5 per cent (2020: 0.5 per cent) terminal growth rate. This growth rate does not exceed theinationrateformarketsintheterritoriesB&Soperatesin.Company’sassumptions used in the recoverable amount calculations, such as capital expenditure and other The carrying amount of goodwill has been allocated to the cash-generating units (CGUs) as follows: x € 1,000 31.12.2021 31.12.2020 * B&S Liquors 2,096 2,096 B&S Beauty 42,781 39,526 B&S Personal Care 8,680 8,680 B&S Food - 500 B&S Health 4,934 4,934 B&S Retail 6,601 6,601 65,092 62,337 * Reference is made to note 5 segment reporting. x € 1,000 31.12.2021 31.12.2020 The Netherlands 21,277 21,777 Rest of the world 43,815 40,560 65,092 62,337 Impairment testing The Group tests goodwill annually for impairment, or more frequently if there are indications that goodwill might be impaired. Goodwill is allocated to those cash- generatingunitsthatareexpectedtobenetfromthebusinesscombinationinwhichthe goodwill arose and in all cases that is at the operating segment level, which represents the lowest level at which goodwill is monitored for internal management purposes. 145 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements theinationrateformarketsintheterritoriesB&Soperatesin.Company’sassumptions used in the recoverable amount calculations, such as capital expenditure and other assumptions are inherently uncertain and may ultimately differ from actual amounts. InthenancialyearturnoverinourFoodSegmenthasbeensubjecttoongoing challenges like Covid-19, impacting the demand in its business lines Maritime & Industrial Catering and Duty Free. Furthermore although we anticipated on the withdrawal of troops from Afghanistan the effect of the abrupt ending of all military business in Afghanistan exceeded our expectations. Segment management counterbalanced the turnover impact with increased sales in other regions however the margin at these sales wassignicantlylower.Therelativelyhighcostfootprintofthesegmentincombination withthepressureonthegrossprotmarginputsapressureontheEBITDAmarginand cash generating capacity. Although management’s base case assumptions resulted in a value in use calculation exceeding the operating asset at carrying value, we also considered less likely but also less positive scenario’s given the limited headroom in the base case. Based thereon the carrying amount of this CGU was determined to be higher than its scenario based weighted recoverable amount of € 81,929,000 and an impairment loss of € 10,193,000 during 2021 (2020: nil) was recognised. B&S Health The recoverable amounts of the cash-generating unit is determined based on a value in usecalculationwhichusescashowprojectionsbasedonnancialbudgetsand nanciallong-termplansapprovedbytheExecutiveBoardcoveringave-yearperiod, and a discount rate of 8.7 per cent per annum (2020: 7.5 per cent per annum). Increases in market volume (due to increase of population and rising consumption) have been taken into consideration as well as the scarcity of products, growing market pressure on prices, government-induced or otherwise. Assumptions for average selling prices and cost of sales are based on historical experience and expectations of future changes in themarket.Cashowsbeyondtheve-yearperiodhavebeencalculatedusingasteady 0.5 per cent (2020: 0.5 per cent) terminal growth rate. This growth rate does not exceed theinationrateformarketsintheterritoriesB&Soperatesin.Company’sassumptions used in the recoverable amount calculations, such as capital expenditure and other assumptions are inherently uncertain and may ultimately differ from actual amounts. The impairment testing for 2021 did not result in impairments for this CGU (2020: nil). B&S Personal Care The recoverable amounts of the cash-generating unit is determined based on a value in usecalculationwhichusescashowprojectionsbasedonnancialbudgetsand nanciallong-termplansapprovedbytheExecutiveBoardcoveringave-yearperiod, and a discount rate of 8.0 per cent per annum (2020: 7.5 per cent per annum). Increases in market volume (due to increase of population and rising consumption) have been taken into consideration as well as the scarcity of products, growing market pressure on prices, government-induced or otherwise. Assumptions for average selling prices and cost of sales are based on historical experience and expectations of future changes in themarket.Cashowsbeyondtheve-yearperiodhavebeencalculatedusingasteady 0.5 per cent (2020: 0.5 per cent) terminal growth rate. This growth rate does not exceed theinationrateformarketsintheterritoriesB&Soperatesin.Company’sassumptions used in the recoverable amount calculations, such as capital expenditure and other assumptions are inherently uncertain and may ultimately differ from actual amounts. The impairment testing for 2021 did not result in impairments for this CGU (2020: nil). B&S Food The recoverable amounts of the cash-generating unit is determined based on a value in usecalculationwhichusescashowprojectionsbasedonnancialbudgetsand nanciallong-termplansapprovedbytheExecutiveBoardcoveringave-yearperiod, and a discount rate of 7.8 per cent per annum (2020: 7.5 per cent per annum). Increases in market volume (due to increase of population and rising consumption) have been taken into consideration as well as the scarcity of products, growing market pressure on prices, government-induced or otherwise. Assumptions for average selling prices and cost of sales are based on historical experience and expectations of future changes in themarket.Cashowsbeyondtheve-yearperiodhavebeencalculatedusingasteady 0.5 per cent (2020: 0.5 per cent) terminal growth rate. This growth rate does not exceed 146 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Discount rates and terminal growth rates applied in the calculation of the value in use: 2021 B&S Liquors B&S Beauty B&S Personal Care B&S Food B&S Health B&S Retail Discount rate 7.4% 8.1% 8.0% 7. 8% 8.7% 8.6% Terminal growth rate 0.5% 0.5% 0.5% 0.5% 0.5% 0.5% Thediscountraterepresentsthecurrentmarketassessmentoftherisksspecictoeach cash-generating unit, taking into account the time value of money and individual risks of theunderlyingassetsthathavenotbeenincludedinthecashowestimate. The discount rate is based on the weighted average cost of capital (WACC) that is relevant to the assets of the cash-generating unit. The WACC consists of the cost of equity and the costs of debt. The beta factors are evaluated annually and are based on the publicly available Market data and differ per cash-generating unit. The (interest) risk per country is taken into account based on the revenue per country, based on publicly available country risk premium. assumptions are inherently uncertain and may ultimately differ from actual amounts. The impairment testing for 2021 did not result in impairments for this CGU (2020: nil). B&S Retail The recoverable amounts of the cash-generating unit is determined based on a value in usecalculationwhichusescashowprojectionsbasedonnancialbudgetsand nanciallong-termplansapprovedbytheExecutiveBoardcoveringave-yearperiod, and a discount rate of 8.6 per cent per annum (2020: 7.5 per cent per annum). Increases in market volume (due to increase of population and rising consumption) have been taken into consideration as well as the scarcity of products, growing market pressure on prices, government-induced or otherwise. Assumptions for average selling prices and cost of sales are based on historical experience and expectations of future changes in the market. The global outbreak of Covid-19 has affected the Group’s results, consolidatedstatementofnancialpositionandcashowspresentedinthese consolidatednancialstatements.Theimpactofthepandemichasbeenexplicitly notable within the Travel Retail Industry and as such in our B&S Retail Segment. The projected turnover levels applied in the value in use calculations are, amongst others,dependentontherecoveryininternationalairtrafc.Managementhasapplied bothgeneralmarketTrafcForecast(e.g.AirportsCounsilInternational“ACI”)aswellas airportspecicinformationwhenavailable.Cashowsbeyondtheve-yearperiodhave been calculated using a steady 0.5 per cent (2020: 0.5 per cent) terminal growth rate. ThisgrowthratedoesnotexceedtheinationrateformarketsintheterritoriesB&S operates in. Company’s assumptions used in the recoverable amount calculations, such as capital expenditure and other assumptions are inherently uncertain and may ultimately differ from actual amounts. The impairment testing for 2021 did not result in impairments for this CGU (2020: nil). 147 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Impairment loss The indicated impairment loss for B&S Food is allocated as follows: x € 1,000 2021 2020 Goodwill 12 500 - Other intangible assets 13 56 - Property, plant and equipment 14 1,987 - Right-of-use assets 24 7,650 - 10,193 - Impairment loss The goodwill attributed to the CGU B&S Food of € 500,000 has been impaired as at December 31, 2021. The impairment loss on goodwill and the indicated non-current assets has been included in the line-item impairment of non-current assets. Sensitivity to changes in assumptions The Group has conducted an analysis of the sensitivity of the impairment test model to changes in the key assumptions used to determine the recoverable amount for each of the cash-generating units to which goodwill is allocated. The realisable value is inuencedbyfactorssuchasprojectionsoffutureeconomicconditionsandexpectations regarding market developments and operations. The estimates made for these factors maychangeovertime,whichcouldleadtoimpairmentrecognisedasaprotorlossin the income statement. The recoverable amount also depends on the discount rate used, which is based on an estimate of the weighted average cost of capital for the unit concerned. The following aspects provide an indication of the sensitivity of the impairment tests to changes in key assumptions used: Ifthediscountrateisassumedtobe1%higherthanappliedintheseparate impairment tests, no impairments would have been required for the cash- generating units B&S Liquors, B&S Beauty, B&S Personal Care, B&S Health and B&S Retail. Iffutureannualsalesgrowthrateisset5%lowerthanappliedintheseparate impairment tests, whilst maintaining cost levels on the original assumptions, no impairments would have been required for the cash-generating units B&S Liquors, B&S Beauty, B&S Personal Care, B&S Health and B&S Retail. grossmarginsweretoshowadecreaseof1%overthecomingyears,while maintaining the other assumptions applied in the separate impairment tests, no impairments would have been required for the cash-generating units B&S Liquors, B&S Beauty, B&S Personal Care, B&S Health and B&S Retail. 148 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 13 Other intangible assets Theotherintangibleassetscanbespeciedasfollows: x € 1,000 31.12.2021 31.12.2020 Software 12,610 14,370 Brand names 2,953 3,110 Concessions 837 944 Customer portfolios 6,460 7,603 Supplier portfolios 23,717 26,157 Private labels 5,979 6,336 Other 1,505 1,738 54,061 60,258 x € 1,000 31.12.2021 31.12.2020 The Netherlands 23,218 27,319 Rest of the world 30,843 32,939 54,061 60,258 Intangibleassetsareamortisedovertheirusefuleconomiclife,denedatthemomentof acquisition.Theseintangibleassetsareamortisedbetween10%and33%.Similarasin the previous year, no intangible assets have been pledged as security for liabilities. 149 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Themovementscanbespeciedasfollows: x € 1,000 2021 Software Brand names Concessions Customer portfolios Supplier portfolios Private labels Other Total At cost: Balance as at January 1, 22,958 5,011 6,004 9,595 37,840 8,177 4,845 94,430 Additions 2,474 153 - - - - 22 2,649 Acquired in business combinations - - - 297 - - - 297 ReclassicationfromPP&E 146 - - - - - - 146 Impairment loss (5) - - (51) - - - (56) Foreign currency translation 251 214 - - 2,349 682 287 3,783 Disposals - (48) - - - - - (48) 25,824 5,330 6,004 9,841 40,189 8,859 5,154 101,201 Accumulated amortisation: Balance as at January 1, (8,588) (1,901) (5,060) (1,992) (11,683) (1,841) (3,107) (34,172) ReclassicationfromPP&E (88) - - - - - - (88) Foreign currency translation (158) (58) - - (529) (320) (189) (1,254) Amortisation (4,380) (418) (107) (1,389) (4,260) (719) (353) (11,626) (13,214) (2,377) (5,167) (3,381) (16,472) (2,880) (3,649) (47,140) Balance as at December 31, 12,610 2,953 837 6,460 23,717 5,979 1,505 54,061 150 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements x € 1,000 2020 Software Brand names Concessions Customer portfolios Supplier portfolios Private labels Other Total At cost: Balance as at January 1, 18,743 4,783 6,004 9,368 40,438 8,932 5,152 93,420 Additions 5,602 461 - - - - 10 6,073 Acquired in business combinations 143 - - 227 - - - 370 Foreign currency translation (278) (233) - - (2,598) (755) (317) (4,181) Disposals (1,252) - - (1,252) 22,958 5,011 6,004 9,595 37,840 8,177 4,845 94,430 Accumulated amortisation: Balance as at January 1, (5,275) (1,504) (4,286) (651) (7,982) (1,117) (2,857) (23,672) Acquired in business combinations (103) - - - - - - (103) Disposals 1,251 1,251 ReclassicationfromPP&E (25) (25) Foreign currency translation 157 48 - - 325 364 192 1,086 Amortisation (4,593) (445) (774) (1,341) (4,026) (1,088) (442) (12,709) (8,588) (1,901) (5,060) (1,992) (11,683) (1,841) (3,107) (34,172) Balance as at December 31, 14,370 3,110 944 7,603 26,157 6,336 1,738 60,258 151 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 14 Property, plant and equipment Property,plantandequipmentcanbespeciedasfollows: x € 1,000 31.12.2021 31.12.2020 Land and property 16,184 17,316 Equipment 15,157 13,131 Other 6,737 6,880 38,078 37,327 x € 1,000 31.12.2021 31.12.2020 The Netherlands 31,208 31,080 Rest of the world 6,870 6,247 38,078 37,327 152 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Themovementscanbespeciedasfollows: x € 1,000 2021 Land and property Equipment Other Total At cost: Balance as at January 1, 47,951 39,798 27,397 115,146 Additions 1,464 6,762 2,236 10,462 Acquired in business combinations - - 29 29 Foreign currency translation 10 312 606 928 Impairment loss (487) (1,258) (242) (1,987) ReclassicationtoOtherintangibleassets - - (146) (146) ReclassicationwithinPP&E - (299) 299 - Disposals (213) (224) (742) (1,179) 48,725 45,091 29,437 123,253 Accumulated depreciation: Balance as at January 1, (30,635) (26,667) (20,517) (77,819) Acquired in business combinations - - (5) (5) Disposals 113 128 627 868 Foreign currency translation (10) (218) (450) (678) ReclassicationtoOtherintangibleassets - - 88 88 ReclassicationwithinPP&E - 19 (19) - Depreciation (2,009) (3,196) (2,424) (7,629) (32,541) (29,934) (22,700) (85,175) Balance as at December 31, 16,184 15,157 6,737 38,078 153 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements x € 1,000 2020 Land and property Equipment Other Total At cost: Balance as at January 1, 44,821 38,858 27,380 111,059 Additions 3,141 1,793 2,477 7,411 Acquired in business combinations - 32 21 53 Foreign currency translation (11) (315) (546) (872) ReclassicationwithinPP&E (127) 127 - Disposals - (443) (2,062) (2,505) 47,951 39,798 27,397 115,146 Accumulated depreciation: Balance as at January 1, (28,801) (22,860) (20,086) (71,747) Acquired in business combinations - (17) (9) (26) Disposals - 444 1,968 2,412 Foreign currency translation 10 195 469 674 ReclassicationtoOtherintangibleassets 25 25 ReclassicationwithinPP&E (165) 165 - Depreciation (1,844) (4,264) (3,049) (9,157) (30,635) (26,667) (20,517) (77,819) Balance as at December 31, 17,316 13,131 6,880 37,327 The depreciation rates applied are as follows: Land 0% Property 5% Equipment 10%-20% Other 12.5%-20% Unlike previous year, no property, plant and equipment has been pledged as security for non-current loans and borrowings and current liabilities provided by credit institutions. 154 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Next Generation Parfums B.V.: x € 1,000 31.12.2021 31.12.2020 Current assets 4,069 2,521 Non-current assets 3,666 2,729 Current liabilities 718 310 Non-current liabilities 4,196 2,488 Turnover 7,977 6,395 Prot(loss)fortheyear 389 783 Net assets of the associate 2,821 2,452 Carrying amount of the Group's interest 1,603 1,409 STG Logistica Y Depositos S.L.: x € 1,000 31.12.2021 31.12.2020 Current assets 101 119 Non-current assets 117 101 Current liabilities 82 86 Non-current liabilities 150 150 Turnover 630 621 Prot(loss)fortheyear (1) - Net assets of the associate (14) (16) Carrying amount of the Group's interest 2 2 15 Investments in associates Investmentsinassociatedcompaniescanbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 2,630 2,517 Shareofprotofassociatedcompanies 159 305 Foreign currency translation (6) (177) Other changes - (15) Balance as at December 31, 2,783 2,630 The principal associated companies of the Group are as follows: 2021 2020 Comptoir & Clos SAS, France (in liquidation) 50% 50% Next Generation Parfums B.V., the Netherlands 50% 50% STG Logistica Y Depositos S.L., Spain 50% 50% Capi-Lux South Africa (PTY) Ltd., South Africa 49% 49% These companies have the same principal activities as the Group. The aggregate nancialdataoftheprincipalassociatedcompaniesareshownbelow,brokendowninto total assets and liabilities and the most important items in the income statement. 155 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements This item consists of the following loans as at December 31, 2021: In 2019 the Company granted a loan to a minority shareholder for the original amountof€1,088,000.Theapplicableinterestrateis3,5%.Theloanwillberepaid in total within seven years. No securities have been provided. In 2020 the Company granted a loan to an associate, STG Logistica Y Depositos S.L., for the original amount of € 150,000, no maturity date has been set. Theapplicableinterestrateis10%.Nosecuritieshavebeenprovided. In 2020 the Company granted a loan to a third party for the original amount of €242,000,nomaturitydatehasbeenset.Theapplicableinterestrateis10%. No securities have been provided. 17 Deferred tax assets Themovementsinthedeferredtaxassetscanbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 1,417 366 Additions 1,458 - Transferto/fromprotorloss (574) 1,049 Foreign currency translation (1) 2 Balance as at December 31, 2,300 1,417 Capi-Lux South Africa (PTY) Ltd.: x € 1,000 31.12.2021 31.12.2020 Current assets 2,595 2,581 Non-current assets 142 140 Current liabilities 328 236 Turnover 1,937 2,204 Prot(loss)fortheyear (72) (140) Net assets of the associate 2,409 2,485 Carrying amount of the Group's interest 1,178 1,220 16 Receivables Thereceivablescanbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 1,444 3,520 Acquired in business combinations - (1,650) New loans issued - 392 Repayments (210) (818) Balance as at December 31, 1,234 1,444 156 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 19 Trade receivables Thetradereceivablescanbespeciedasfollows: x € 1,000 31.12.2021 31.12.2020 Trade receivables 197,345 198,313 Allowance for doubtful debts (2,307) (2,685) 195,038 195,628 Theallowancefordoubtfulreceivablesprovidesafairreectionoftheriskofnoneorlate payments at the balance sheet date. Accordingly the carrying amount of the trade receivables is approximately equal to its fair value. The provision has been recognised at nominal value, given its current nature. An allowance for doubtful debts was formed duringthenancialyearamountingto€342,000(2020:€1,975,000)thatwaschargedto theprotorloss.Nointerestischargedonpastduetradereceivables. Themovementintheallowancefordoubtfuldebtscanbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 2,685 769 Acquired in business combinations - 7 Transferfromprotorloss 342 1,975 Amounts written off as uncollectable (720) (66) Balance as at December 31, 2,307 2,685 The deferred tax assets relate to the following items: x € 1,000 31.12.2021 31.12.2020 Property, plant and equipment 140 171 Intangiblexedassets 29 29 Right-of-use assets 1,883 321 Carry forward interest costs - 491 Other 248 405 2,300 1,417 18 Inventory Theinventorycanbespeciedasfollows: x € 1,000 31.12.2021 31.12.2020 Value of trade goods 322,542 274,196 Prepayments on trade inventory 65,539 40,480 Provision for obsolescent inventory (6,318) (6,403) 381,763 308,273 The amount of the write-down during 2021 amounts to € 1,744,000 (2020: € 2,136,000) andhasbeenrecognisedinthestatementofprotorlossasaloss.Unlikepreviousyear, no inventories have been pledged as a security for non-current loans and borrowings and current liabilities provided by credit institutions. The cost of inventories recognised as an expense during the year in respect of continuing operations was € 1,460 million (December 31, 2020: € 1,477 million). 157 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 20 Share capital Refer to the consolidated statement of changes in equity for information on the composition, amount and changes of equity. Details of the share capital are set out below. Information on other elements of equity (reserves) is set out in the next note. Issued share capital The issued share capital as at December 31, 2021 amounted to € 5,050,639.26 and consists of 84,177,321 Ordinary shares with a nominal value of € 0.06 each. Since March 23, 2018 the Company is listed on the Amsterdam Stock Exchange. There have been no movements in the share capital in both 2021 and 2020. Share-based payment As per March 23, 2018, a group of managers has received a share incentive amounting to € 4.5 million from the pre-IPO shareholders of B&S Group S.A., Sarabel Invest S.à r.l. and Lebaras Belgium BVBA. A number of existing Ordinary Shares (310,345) representing a total amount of € 4.5 million as per March 23, 2018, have been provided to Stichting Administratiekantoor B&S Participations (STAK). The Ordinary Shares referred to will be held by the STAK and depositary receipts for such Ordinary Shares have been issued to the managers pro rata to their respective entitlements. Five years following March 23, 2018, the managers will be entitled to acquire the underlying Ordinary Shares from the STAK for no consideration. In the event any of the managersceasestobeemployedbyB&SGroupS.A.priortotheperiodofvevesting yearshavingbeenlapsed,theOrdinarySharesheldbytheSTAKforhisbenetwillbe transferred back to the pre-IPO shareholders without any compensation. During the vestingperiodthe€4.5millionwillbechargedtotheconsolidatedstatementofprotor loss. The working capital tied up in trade receivables is expressed in Days of Sales Outstanding (DSO). The average DSO for 2021 was 38 days (2020: 38). The provision for doubtful receivables, taking into account the expected lifetime losses following the simpliedapproachasperIFRS9,relatesentirelytotradereceivablespastthe contractually agreed due date for payment. Items that are considered doubtful have been fully provided for. Estimations and assumptions are applied to determine the size of the provision.Thoseestimatesandassumptionsarebasedonageanalysisandspecic developments in terms of market conditions and credit risks. In the judgement of the Group, the credit quality for receivables past due at the balance sheet date but not providedforissufcient. The age of the receivables that are past due but not impaired are as follows: x € 1,000 31.12.2021 31.12.2020 Trade receivables less than 30 days due 26,042 29,854 Trade receivables between 30 and 60 days due 14,897 8,413 Trade receivables more than 60 days due 12,183 7,591 53,122 45,858 Trade receivables disclosed above include amounts that are past due at the end of the reporting period for which the Group has not recognised an allowance for doubtful debts becausetherehasnotbeenasignicantchangeincreditqualityandtheamountsare still considered recoverable. Based on an individual assessment of all the due receivables it was concluded that impairment was not required for these receivables due tothecreditqualitynotbeingsignicantlychanged. The tax receivables include an amount of € 5,700,000 with a possible long-term character. The maturity period of all other receivables is less than one year. 158 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Retained earnings Theretainedearningscompriseallcumulativeprotorlossmovementslesscumulative changes.Themovementcanbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 255,618 236,704 Protfortheperiod 38,471 21,697 Dividend to the owners of the Company (8,418) - Transactions under common control (note 33) (34,256) (681) Share-based payments 900 900 Other changes - (79) 252,315 258,541 Fair value adjustment non-current liabilities 7,004 (2,923) Balance as at December 31, 259,319 255,618 Proposed appropriation of the result for 2021 The Executive Board proposes to pay a dividend of € 15,152,000 and to add € 23,319,000 to the reserves. Thisproposedappropriationhasnotbeenaccountedforintheconsolidatednancial statements. Prot appropriation 2020 The2020consolidatednancialstatementswereapprovedduringtheGeneralMeeting onMay18,2021.TheGeneralMeetingapprovedtheproposedprotappropriation. 21 Reserves Direct changes in equity are recognised net of tax effects. The following elements of reservescanbespeciedasfollows: Cash ow hedge reserve Thecashowhedgereserverepresentsthecumulativeamountofgainsandlosseson hedginginstrumentsdeemedeffectiveincashowhedges.Thecumulativedeferred gainorlossonthehedginginstrumentisrecognisedinprotorlossonlywhenthe hedgedtransactionimpactstheprotorloss,orisincludeddirectlyintheinitialcostor othercarryingamountofthehedgednon-nancialitems(basisadjustment). Themovementcanbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 1,066 643 Effective portion of changes in fair value of cashowhedges (1,097) 423 Balance as at December 31, (31) 1,066 Reserve for translation differences The reserve for translation differences comprises all cumulative translation differences arisingfromthetranslationofthenancialstatementsofactivitiesincurrenciesother thantheeuro.Thereserveisnotfreelydistributable.Themovementcanbespeciedas follows: x € 1,000 2021 2020 Balance as at January 1, (5,360) 273 Foreign currency translation through OCI 5,185 (5,633) Balance as at December 31, (175) (5,360) 159 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Themovementinthenon-controllinginterestcanbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 50,527 49,096 Shareofprotofassociatedcompanies 16,103 18,941 Foreign currency translation 3,159 (4,258) Effective portion of changes in fair value of cashowhedges (15) (9) Transactions under common control (15,178) (1,619) Dividend paid to non-controlling interest (11,986) (13,262) Reservestransferredtoprotright certicates - (292) 42,610 48,597 Reclassicationto'Othernon-current liabilities' (3,503) 1,930 Balance as at December 31, 39,107 50,527 Thereclassicationto‘Othernon-currentliabilities’relatestothe25%non-controlling interest in FNet Acquisition Company LLC. Reference is made to note 28 for further detailsonthisreclassication. 22 Non-controlling interest The non-controlling interest consist of the third-party share in the following companies: 31.12.2021 31.12.2020 J.T.G. Holding B.V., the Netherlands - 24.62% J.T.G. WWL S.à r.l., G.D. Luxembourg 8.21% 24.62% Topbrands Europe B.V., the Netherlands 32.83% 32.83% FNet Acquisition Company LLC, Delaware, United States 25% 25% FNC International B.V., the Netherlands 25% 25% B&S HTG B.V., the Netherlands 5% 5% Lagaay Medical Group B.V., the Netherlands 30% 30% Europort Groep B.V., the Netherlands 20% 20% J.T.G. Distribution HK Ltd, Hong Kong 22.50% 22.50% B&S Beauty B.V., the Netherlands 5% - Prot Rights: B&S Investments B.V., Delfzijl, the Netherlands 100% 100% 160 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 23 Loans and borrowings Theloansandborrowingscanbespeciedasfollows: x € 1,000 31.12.2021 31.12.2020 Borrowings from banks 177,956 46,496 Borrowings from third parties 3,000 3,000 Non-current liabilities 180,956 49,496 Unsecured borrowings from banks 58,810 166,393 Borrowings from banks due within one year 1,115 11,737 Current liabilities 59,925 178,130 x € 1,000 31.12.2021 31.12.2020 Interest Year of maturity %Nominal interest rate Maximum amount Nominal value Carrying amount Maximum amount Nominal value Carrying amount Unsecured bank loans variable 1,2 2024 1.0% 175,000 175,000 174,016 - - - Unsecured revolving credit facilities variable 1,2 2024 3 1.3% 145,000 48,633 48,113 - - - Unsecured overdraft facilities variable 1,2 Until further notice 1.2% 290,000 8,000 8,000 - - - Other bank loans xed 2022-2025 1.7% 5,055 5,055 5,055 57,867 57,867 57,867 Other revolving credit facilities variable 2 2022 1.7% 10,650 2,697 2,697 258,000 100,752 100,752 Secured overdraft facilities variable 2 2021 1.7% - - - 225,000 65,641 65,641 Borrowings from third party when conditions are met 0% 3,000 3,000 3,000 3,366 3,366 3,366 Total loans and borrowings 628,705 242,385 240,881 544,233 227,626 227,626 Lease liabilities 2022-2037 1.7% 58,344 56,698 Lease liabilities due within one year 1.7% 11,035 10,034 Total interest bearing loans and borrowings 628,705 310,260 544,233 294,358 1 BasedoncovenantswithnancialinstitutionsandtheGroup’sleverageratio. 2 Reference rate depending on the currency drawn: EURIBOR, SOFR, SONIA, TONAR, EIBOR. 3 Two extensions options of one year each. 161 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Thequarterlytestednancialcovenantsforthenewnancialagreementsapplicableto the Group are: A maximum of 4.0 of Total Net Debt / Adjusted EBITDA A maximum of 4.5 of Total Net Debt / Adjusted EBITDA after a considerable acquisition A minimum of 4.0 of Interest Coverage Ratio AdjustedEBITDAisanon-GAAPmeasurementandisdenedasfollowsinall applicable agreements: (a) EBITDA for the last twelve months (the Relevant Period) adjusted by the EBITDA of a member of the Group acquired during the Relevant Period as if the acquisition occurredontherstdayofsuchRelevantPeriodand; (b) excluding the EBITDA attributable to any member of the Group disposed of during the Relevant Period for that part of the Relevant Period as if the disposal occurred ontherstdayofsuchRelevantPeriod. Aspartoftherenancingtheexistingbankloansandtherevolvingcreditfacilitieswere repaid except for the existing bank loans and the revolving credit facilities for the Spanish subsidiaries. These Spanish facilities have a maximum amount of € 15.550.000 and will mature between 2022 and 2025. For more information about the Group’s exposure to interest rate, foreign currency and liquidity risk, see note 31. Borrowings from third parties Borrowings from third parties exists of two loans of € 1.5 million each. The applicable interestrateforbothloansis2.5%,butwillonlybecomeapplicableafterfullmentof certainconditions.Nosecuritiesareprovided.Repaymentisdependentonfullmentof beforementioned conditions. Borrowings from banks AtDecember30,2021,theGroupcompleteditsrenancingeffortsbyrepayingmostof itspre-existingbankdebtandcentralisedthemajorityofitsnancingagreementsonthe level of B&S Group S.A. The Group has entered into multiple bilateral term loans and committedrevolvingcreditfacilitiestoprovidesuretyandmaturitytoitsnancing portfoliowhilerenewedoverdraftfacilitiescontributetothenecessaryexibilitytocounter swings in working capital and to provide headroom for potential business opportunities. ThebilateralagreementsareenteredintowithvemajorEuropeanbanksandare provided on equal terms and conditions. Long-lasting relationships existed with these nancinginstitutionsthatallpreviouslyprovidednancingandcashmanagement solutions to entities within the Group. Unlike with previous borrowings and credit facilities, no assets have been pledged as security for the loans and borrowings provided. Instead, guarantees of companies within the Group are provided. The unsecured bank loans of € 175 million consist out of three fully drawn term loans that are to be fully repaid at maturity in 2024. These loans form the basis of the debt provided bynancialinstitutions. The unsecured revolving credit facilities of € 145 million have all been entered into for three years until 2024. The Group holds two extension options of one year each, possibly prolonging the agreements until 2026. These unsecured revolving credit facilities are drawn on demand utilising multicurrency ancillary facilities. Theunsecuredoverdraftfacilitiesof€290millionareprovidedonan‘untilfurthernotice’ basisbythenancialinstitutionsandprovidetheGroupwithnecessaryheadroomand exibility.Similartotherevolvingcreditfacilities,theyaredrawnondemandusing ancillary facilities. To support future growth and liquidity needs, the unsecured overdraft facilities could possibly be converted to revolving credit facilities when utilisation has become structural. 162 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements The Group leases several assets including buildings and vehicles. The average remaining lease term is 4 years. At December 31, 2021, the Group is committed to € 1.2 millionforshort-termleases.Thetotalcashoutowforleasesamountsto€12.2million. Themovementsintheleaseliabilitiescanbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 66,732 71,666 Additions 13,051 5,930 Repayments on lease liabilities (11,091) (9,966) Foreign currency translation 687 (898) 69,379 66,732 Reclassicationto'Currentliabilities' (11,035) (10,034) Balance as at December 31, 58,344 56,698 Thematurityandrelatedvalueofleaseliabilitiescanbespeciedasfollows: x € 1,000 31.12.2021 < 1 year 1 <> 5 years > 5 years Total Lease liabilities 11,035 34,308 24,036 69,379 11,035 34,308 24,036 69,379 TheGroupdoesnotfaceasignicantliquidityriskwithregardtoitsleaseliabilities. Lease liabilities are monitored within the Group’s treasury function. 24 Leases Theleasescanbespeciedasfollows: x € 1,000 31.12.2021 31.12.2020 Property 58,537 64,565 Vehicles 2,143 1,510 60,680 66,075 ThemovementsintheGroup’sright-of-useassetscanbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 66,075 71,498 Additions 13,051 5,930 Impairment loss (7,650) - Depreciation right-of-use assets (11,455) (10,580) Foreign currency translation 659 (773) Balance as at December 31, 60,680 66,075 x € 1,000 31.12.2021 31.12.2020 The Netherlands 43,708 56,227 Rest of the world 16,972 9,848 60,680 66,075 163 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Thematurityandrelatedvalueofthedeferredtaxliabilitiescanbespeciedasfollows: x € 1,000 31.12.2021 < 1 year 1 <> 5 years > 5 years Total Deferred tax liabilities 1,885 7,112 1,969 10,966 1,885 7,112 1,969 10,966 The deferred tax liabilities relate to the following items: x € 1,000 31.12.2021 31.12.2020 Property, plant and equipment 1,500 88 Intangiblexedassets 8,934 9,999 Other 532 597 10,966 10,684 26 Retirementandotheremployeebenetobligations The movements for the provision can be summarised as follows: x € 1,000 2021 2020 Balance as at January 1, 1,001 893 Paidduringthenancialyear (20) (209) Transferto/fromprotorloss 378 317 Balance as at December 31, 1,359 1,001 Theamountsrecognisedintheprotorlosscanbespeciedasfollows: x € 1,000 2021 2020 Depreciation expenses on right-of-use assets (Property) 10,573 9,683 Depreciation expenses on right-of-use assets (Vehicles) 882 897 Impairment loss on right-of-use assets (Property) 7,650 - Interest expense on lease liabilities 1,139 1,230 Expenses relating to short-term leases and leases of low value assets 1,189 1,585 21,433 13,395 25 Deferred tax liabilities Themovementindeferredtaxliabilitiescanbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 10,684 12,986 Acquired in business combinations 75 57 Addition 1,458 - Transfertoprotorloss (1,823) (1,904) Foreign currency translation 572 (702) Reclassicationfrom'Currentcorporate income tax liability' - 247 Balance as at December 31, 10,966 10,684 164 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Accordingtothepensionplantheemployerhastheobligationtopayaxedannual premiumtothepensionfundoftwo-thirdof22%ofthepensionbase,theremaining one-third is paid by the employee. The return on the contribution payments has not been guaranteed. The only liability for the employer is to pay the annual premium as the employer has no obligation to pay additional contributions, neither to compensate for inationnortosupplementincasethefunddoesnotholdsufcientassetstofundthe pension obligations. In the last case, the fund would need to take other measures to restore its solvency, such as reductions of the entitlements of the plan members. The pensionable salary accommodated by Hnpf is limited to € 112,189 (2020: € 110,111). The pension base is the difference between the pensionable (current) salary of the employeeandthestateretirementbenet.Hnpfhasstatedthatthefundingratiois 102.9%atDecember31,2021(2020:98.8%). BasedonIAS19,thePensionPlanassuchisaccountedforasadenedcontribution plan.TheGrouppresentstheemployercontributionintheprotorlossitem“Personnel costs”. Industry pension schemes ‘Bedrijfstakpensioenfonds voor de Detailhandel’ PursuanttotheDutchpensionsystemthisplanisnancedbycontributionstoan industry pension fund. Participation in the industry pension fund is required by the collective labour agreement applicable to Koninklijke Capi-Lux Holding B.V, Anker Amsterdam Spirits B.V. and Square Dranken Nederland B.V. Therelatedaccruedentitlementsarealwaysfullynancedintherelatedcalendaryear through – at least – cost effective contribution payments. The pension plan is a career average plan including – for both active and inactive participants (former employees not yet retired and retired persons) – conditional granting of supplements. The granting of supplements depends on it the investment return. The provision for pension obligations consists of a provision for pensions of former personnel that have taken effect and are valued at fair value. The maturity of these obligationsislessthanveyears. This provision also includes an end-of-service indemnity payable to employees at the reporting date in accordance with the U.A.E. labour laws, and is based on current remuneration and cumulative years of service at the reporting date. This provision is consideredasadenedbenetplan.Totalamountofend-of-serviceindemnityprovision as per 2021 was € 440,000 (2020: € 320,000). Dened contribution plans TheCompanyoperatesdenedcontributionretirementbenetplansforallqualifying employees. The assets of the plans are held separately from those of the Company in funds under the control of trustees. When employees leave the plans prior to full vesting of the contributions, the contributions payable by the Company are reduced by the amount of forfeited contributions. Thetotalexpenserecognisedintheprotorlossof€4,615,000(2020:€4,680,000) representscontributionspaidorpayablebytheGroupatratesspeciedintherulesof the plans. As at December 31, 2021, contributions of € 512,000 (2020: € 375,000) due in respect of the 2021 (2020) reporting period had not been paid over to the plans and hence were included in the short-term liabilities. These amounts were paid after the end of the reporting period. Pension plan pension fund “Stichting Het nederlandse pensioenfonds” UntilAugust2020,theGroupoperateddenedcontributionretirementbenetplansfor employeesforwhomthebenetplanwasaccommodatedbythecompanypensionfund “StichtingPensioenfondsB&S”(alsoreferredtoas‘Companypensionfund’). Thedenedcontributionplan(PensionPlan)wasadministeredbyafundthatislegally separated from the entity. On August 1st, 2020, Stichting Pensioenfonds B&S, transferred the pension entitlements of all participants to “Stichting Het nederlandse pensioenfonds (Hnpf)”. 165 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 27 Other provisions Themovementsinthe‘Otherprovisions’canbespeciedasfollows: x € 1,000 2021 2020 Balance as at 1 January 1,500 - Transferredtoprotorloss (498) 1,500 Balance as at 31 December 1,002 1,500 This item comprises of a provision for an onerous concession contract within the Retail segment. Based on the contractual minimum guaranteed rental amounts combined with the passenger expectations during the remaining contracted years, management does expect a loss of € 1.0 million resulting from operating under the terms of this concession contract.Theprovisionwillbereleasedtotheprotorlossgraduallyovertheremaining years of the contract. Theannualaccrualofthepensionentitlementsamountsto1.4%ofthepensionable salary that is based on the gross wage net of a deductible (of € 14.447). The pensionable salaryiscapped(at€58,311).Theannualemployer-paidcontributionis24.75%ofwhich 6.1%iscontributedbytheemployee.Basedonthefundingratioandexpectedreturns the board of the industry pension fund sets the contribution on a yearly basis. Therelatedindustrypensionfundhasstatedthatthefundingratiois119.2%attheend of2021(2020:111.0%).Basedontheadministrativeregulationsthegrouphasno obligationtomakeadditionalcontributionsintheeventofadecitotherthanthrough higher future contributions. BasedonIAS19,thePensionPlanassuchisaccountedforasadenedcontribution plan.TheGrouppresentstheemployercontributionintheprotorlossitem“Personnel costs”. Other dened benet plans Inseveralcountries,denedbenetplansareinplace.Howeverduetothelimited numberofemployeesandlimitednancialrisktheseplansareaccountedforasdened contribution plans. Pension plans for which the pension fund cannot provide data on an individualcompanybasisare,inlinewithIAS19,accountedforasadenedcontribution plans. In 2021 the premium related to these plans charged to the consolidated statement ofprotorlossamountsto€304,000(2020:€347,000). 166 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements (effectively October 29, 2028). The put and call options have a similar strike price and exercise date and as such a liability exists. The exercise prices are dependent on the EBITDA realised in the 12 months preceding the exercise date and a multiple that is dependent on the EBITDA growth rate in the years prior to the exercise date. Thenon-controllinginterestisreclassiedtootherliabilities(long-term)attheendof each reporting period and valued at fair value, being the value of the expected future consideration discounted against long term US government bond yields plus a company specicmark-up.Assuch,apartfromthediscountrate,thefairvaluemeasurementis derived from valuation techniques that include inputs that are not based on observable market data. The fair value adjustments are recognised in retained earnings. Subsidy (IPR) Themovementsin‘Subsidy(IPR)’canbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 721 756 Installments (34) (35) 687 721 Reclassicationto‘Currentliabilities’ (35) (35) Balance as at December 31, 652 686 This item comprises an “InvesteringsPremieRegeling (IPR)” subsidy with an original amount of € 1,264,000 which is being reduced with € 35,000 per year and released to theprotorloss. 28 Other liabilities Theotherliabilitiescanbespeciedasfollows: x € 1,000 2021 2020 Option FragranceNet 38,349 41,850 Subsidy (IPR) 652 686 Contingent consideration Lagaay - 191 Share appreciation rights 75 - Other non-current liabilities 13 - 39,089 42,727 Option FragranceNet Themovementsin‘OptionFragranceNet’canbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 41,850 40,857 Reclassicationfrom'Non-controlling interest' 3,503 (1,930) 45,353 38,927 Fair value adjustment (7,004) 2,923 Balance as at December 31, 38,349 41,850 lnOctober2018theGroupacquired75%ofthesharesofFNetAcquisitionCompany LLC,theestablished100%parentcompanyofFragranceNet.com,Inc.Aspartofthe acquisition,twoputandtwocalloptionshavebeenwrittenontheremaining25%ofthe shares.Theexercisedateofthe“rsttranche”,aputandcalloptiononeffectively12,5% of the FNet Acquisition Company LLC shares, is 5 years after closing date. The exercise dateoftheoptionsontheremaining12,5%ofsharesis10yearsafterclosingdate 167 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements The inputs used in the measurement of the fair values at grant date and measurement date of the SARs were as follows: 2021 Grant date 22.02.2021 Fair value € 1.86 € 2.56 Share price € 7.10 € 7.34 Exercise price € 7.34 € 7.34 Expected volatility (weighted-average) 53.10% 59.36% Expected life (weighted-average) 2.17 years 3.00 years Expected dividends 2.00% 2.00% Risk-free interest rate (based on government bonds) (0.670) (0.456) Expected volatility has been based on an evaluation of the historical volatility of the Company’s share price, particularly over the historical period commensurate with the expected term. The expected term of the instruments has been based on historical experience and general option holder behaviour. 29 Other current liabilities Theothercurrentliabilitiescanbespeciedasfollows: x € 1,000 2021 2020 To be paid for additional shares J.T.G. Holding B.V. and J.T.G. W.W.L. S.à r.l. 38,500 - Other Current liabilities 27,669 27,315 66,169 27,315 Contingent consideration Lagaay Themovementsin‘ContingentconsiderationLagaay’canbespeciedasfollows: x € 1,000 2021 2020 Balance as at January 1, 401 546 Paidduringthescalyear (210) - Transfertoprotorloss (191) (210) Charged interest - 65 - 401 Reclassicationto'Currentliabilities' - (210) Balance as at December 31, - 191 This contingent consideration relates to the acquisition of Lagaay Medical Group B.V. Share appreciation rights (cash-settled) On February 22, 2021, the Group granted 145,000 share appreciation rights (SARs) to the CEO and CFO that entitle them to a cash payment after three years of service. All SARs are still outstanding at year-end and none have vested yet. The SARs can be exercised during three years after vesting (from February 22, 2024 to February 22, 2027). The amount of the cash payment is determined based on the increase in the share price of the Company between grant date and the time of exercise. Total carrying amount of liabilities for SARs as per December 31, 2021 is € 75,000. An amount of € 75,000 related to the cash-settled share-based payments (SARs) has been recognised in the personnel costs. The fair value of the SARs at grant date is determined using the Black-Scholes model. Thefairvalueoftheliability,classiedasanemployeebenetobligation,isremeasured at each reporting date and at settlement date. 168 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 31 Riskmanagementandnancialinstruments Financial instruments by category The following table combines information about: classesofnancialinstrumentsbasedontheirnatureandcharacteristics; thecarryingamountsofnancialinstruments; fairvaluesofnancialinstruments(exceptnancialinstrumentswhencarrying amount approximates their fair value); and fairvaluehierarchylevelsofnancialassetsandnancialliabilitiesforwhichfair value was disclosed. Fair value hierarchy levels 1 to 3 are based on the degree to which the fair value is observable: Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs). 30 Contingent liabilities and contingent assets Concession fee The Group has entered into long-term concession agreements. The maturity of these agreements varies up to 9 years. The amounts involved are based on the turnover of the particular agreement. Guarantees TheGrouphasissuedguarantees.Theseguaranteescanbespeciedasfollows: x € 1,000 31.12.2021 31.12.2020 Total maximum level of guarantees facility granted to the Group 22,500 22,500 Issued guarantees in relation to import duties 5,683 8,249 Issued guarantees in relation to rental agreements 2,783 2,530 Other issued guarantees 834 1,468 9,300 12,247 169 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements x € 1,000 Amortised cost FVTPL FVTOCI Total 31.12.2021 Level 1 Level 2 Level 3 Financial assets not measured at fair value Receivables, non-current assets 1,234 - - 1,234 Trade receivables 195,038 - - 195,038 Cash and cash equivalents 12,547 - - 12,547 208,819 - - 208,819 Financial liability measured at fair value Option FragranceNet - - 38,349 38,349 - - 38,349 Share appreciation rights 75 75 75 - 75 38,349 38,424 - - 38,424 Financial liabilities not measured at fair value Borrowings, non-current liabilities 180,956 - - 180,956 Lease liabilities 69,379 - - 69,379 Unsecured borrowings from banks 58,810 - - 58,810 Borrowings from banks due within one year 1,115 - - 1,115 Trade payables 106,652 - - 106,652 416,912 - - 416,912 170 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements x € 1,000 Amortised cost FVTPL FVTOCI Total 31.12.2020 Level 1 Level 2 Level 3 Financial assets not measured at fair value Receivables, non-current assets 1,444 - - 1,444 Receivables, current assets - - - - Trade receivables 195,628 - - 195,628 Cash and cash equivalents 38,870 - - 38,870 235,942 - - 235,942 Financial liability measured at fair value Option FragranceNet - - 41,850 41,850 - - 41,850 - - 41,850 41,850 - - 41,850 Financial liabilities not measured at fair value Borrowings, non-current liabilities 49,496 - - 49,496 Lease liabilities 66,732 - - 66,732 Unsecured borrowings from banks 166,393 - - 166,393 Borrowings from banks due within one year 11,737 - - 11,737 Suppliernancearrangements - - - - Trade payables 102,477 - - 102,477 396,835 - - 396,835 171 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Measurement of fair values The following tables show the valuation techniques used in measuring Level 2 and Level 3fairvalues,aswellasthesignicantunobservableinputsused: Type Valuation technique Signicantunobservableinputs Inter-relationshipbetweensignicantunobserv- able inputs and fair value measurement Option FragranceNet EBITDA multiplier: The valuation model is based on the EBITDA realized in the 12 months preceding the exercise date and a multiple that is dependent on the EBITDA growth rate in the years prior to the exercise date. The expected future consideration is discounted against long term USgovernmentbondyieldsplusacompanyspecicmark-up. Realized EBITDA 12 months preceding the exercise (December 31, 2021 € 34 million) Expected EBITDA growth (December 31, 20215.0%) Discountrate(December31,2021:2.6% and3.9%) The estimated fair value would increase (decrease) if: • The EBITDA realized 12 months preceding the exercise were higher (lower); or • The EBITDA growth rate in the years prior to the exercise date were higher (lower); or • The discount rate were lower (higher). Financial risk management objectives Asaresultofitsactivities,theCompanyisexposedtovariousnancialrisks. The Company applies a Group-wide treasury policy for the adequate management of cashowsandnancingowscombinedwithmanagementoftherelatednancialrisks, such as currency risks and interest rate risks. Asummaryofthemainnancialrisksisprovidedbelow.Therisksarelinkedtothe Company’s core objectives and categorised as currency risks, interest rate risks, credit risks and liquidity risks. Also mentioned is how the Company manage these risks. 172 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Interest rate risk TheGroupisexposedtointerestraterisksbecausetheentitiesarenancedbyboth xedandvariablerateinterestborrowings. Onthebasisofthenancingpositionasatyear-end2021,B&SGroupS.A.estimates that an increase of 1 percentage point in the euro money market interest rates would haveanegativeeffectofapproximately€2.3milliononnetnancecostsandthusthe result before taxes and a negative effect of € 1.7 million on equity. Fluctuations in long-term interest rates had a limited direct effect on the result, as the interest rate terms arexed. Credit risk Creditriskistheriskofnanciallossifacustomerorcounterpartyinanancial instrument fails to meet its contractual obligations. The risk for B&S Group S.A. arises mainly from trade receivables, for which credit concentration is limited. The activities of the B&S Retail segment consist mainly of retail activities in exchange for directcash.TheGrouphasasignicantnumberofcustomersandaccordinglythereis no material concentration of credit risk. As the Company trades with a large number of clients around the world, strict internal policies and guidelines have been drawn-up regarding business agreements with new clients as well as the setting of payment terms and credit risk management. The Corporate rule is that trade transactions must be secured, either by payment up front, insurance or by a secured payment instrument (guarantee or letter of credit). Before doing business with new clients their creditworthiness is checked by the credit risk department. Foreign currency risk The Group purchases and sells internationally in different currencies however mainly in USD, GBP and JPY. The Group as such has positions in non-functional currencies being, purchase and sales obligations (recorded purchase and sales orders) and forecasted sales (inventory destined to be invoiced in a non-functional currency, for example inventory destined for a USD market). If B&S Group would not hedge these positions it would run transactional risk until the moment the cash is received. Since the Group does not want to be subject to these risks the positions are hedged on a daily basis. The positions are hedged by maintaining a bank balance in the matching currency. On a daily basis via spot FX purchases and sales, the bank balance in foreign currencies is matched with the outstanding exposure following the sales orders, purchase orders and forecasted sales (inventory). Foreign currency sensitivity analysis The Group is mainly exposed to the US Dollar as indicated in the next table. Assuming theEurohadstrengthened(weakened)3%againsttheUSDollarcomparedtotheactual 2021 rate with all other variables held constant the hypothetical result on income before taxeswouldhavebeenachangeof€243,000ifnocashowhedgeaccountinghas beenapplied.A3%increaseordecreaseoftheothercurrenciestheGroupistradingin wouldnothaveasignicantimpactonboththeincomebeforetaxesandtheequityofthe Group. x 1,000 Foreign currency 31.12.2021 31.12.2020 Assets Liabilities Assets Liabilities USD 426,029 416,864 408,313 236,107 GBP 8,883 7,936 5,857 6,753 JPY 246,012 340,794 339,125 317,095 173 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Theextentoftheriskthatcovenantsagreedwithnancialinstitutionsarebreachedis tested and reported on a regular basis. With the present Total Net Debt/Adjusted EBITDA and Interest Coverage Ratio, B&S Group S.A. is comfortably within the covenants agreedwiththevariousnancialinstitutionsofamaximumTotalNetDebt/Adjusted EBITDA of 4.0 and a minimum Interest Coverage Ratio of 4.0. These agreed covenants arethesameforallnancialinstitutionswhoareinvolvedintheborrowingsfrombanks. A10%decreaseinouroperatingresult(denedforthispurposeasoperatingresult before depreciation of property, plant and equipment and amortisation of intangible assets and impairments) would increase Total Net Debt/Adjusted EBITDA by 0.3 points, at unchanged Net Debt. The Total Net Debt/Adjusted EBITDA covenant agreed with nancialinstitutionsissetatamaximumof4.0points.Thiscovenantwouldonlybe breachediftheoperatingresultdecreasesbymorethan36%. A10%decreaseinouroperatingresultwouldreduceinterestcoverageby1.5points, at unchanged interest rates on interest-bearing debt. The interest coverage ratio covenantagreedwithnancialinstitutionsissetataminimumof4.0points. This covenant would only be breached if the operating result decreases by more than 71%. The credit risk department also monitors outstanding payments on a daily basis using an automated and sophisticated credit risk monitoring system. This process meets the requirementsspeciedbytheinsuranceinstitutions.Therigidhandlingofnewclient acceptance and payment control means the Company’s debtor risk is fairly limited and well under control. The average outstanding debt period is less than 60 days, which is within the limits set by management and acceptable for global trading. As a result of our stringent debtor policies, debtor write-offs are limited. Management is aware of the deteriorating creditworthiness of clients in a number of countries due to Covid-19 related trade issues. Given the outstanding relationship with their credit insurers the group was able to remain in a good dialogue with their clients and maintain the required credit insurance lines in place. Liquidity risk LiquidityriskistheriskthatB&SGroupS.A.isunabletomeetitsnancialobligationsat therequiredtime.Liquiditymanagementisbasedontheprinciplethatsufcientliquidity is maintained in the form of credit facilities or cash and cash equivalents to meet the obligationsinbothnormalandexceptionalcircumstances.Cashowsareforecasted within the Group on a regular basis and the extent is determined to which the Group has sufcientliquidityfortheoperatingactivitieswhilemaintainingsufcientcreditfacilities (headroom). AsaresultoftherenancingoftheGroup,aspresentedinnote23,theloansand borrowings provided, excluding borrowings from third party, amounted to € 626 million as at December 31, 2021, meaning a headroom of € 388 million under the existing facilities. Different from previous years is that the available headroom is not subject to borrowing base restrictions and can be utilised as long as the Company remains within the agreed covenants.TheCompanythereforehascreditfacilitiesthataresufcientfortheexisting and expected credit requirements of the Group. 174 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements The following table represents the Group’s remaining contractual maturity for its non-derivativenancialliabilitieswithagreedrepaymentperiods.Thetablescontainthe non-discountedcash-owsaspertherstdatetheGroupcanberequiredtopay. x € 1,000 31.12.2021 Interest < 1 year 1 <> 5 years > 5 years Total Non-interest bearing 106,652 - - 106,652 Lease liabilities 1.7% 11,035 34,308 24,036 69,379 Variable interest rate instruments 1.36% 59,925 177,956 - 237,881 Fixed interest rate instruments 2.5% - 3,000 - 3,000 Closing balance at 31.12.2021 177,612 215,264 24,036 416,912 x € 1,000 31.12.2020 Interest < 1 year 1 <> 5 years > 5 years Total Non-interest bearing 102,477 - - 102,477 Lease liabilities 1.7% 10,034 34,675 22,023 66,732 Variable interest rate instruments 1.71% 178,130 46,496 - 224,626 Fixed interest rate instruments 2.5% - 3,000 - 3,000 Closing balance at 31.12.2020 290,641 84,171 22,023 396,835 175 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements ThefollowingtabledetailtheGroup’sexpectedmaturityforitsnon-derivativenancial assets. x € 1,000 31.12.2021 Interest < 1 year 1 <> 5 years > 5 years Total Non-interest bearing 195,038 - - 195,038 Fixed interest rate instruments 5.4% - 1,234 - 1,234 Cash and cash equivalents 12,547 - - 12,547 Closing balance at 31.12.2021 207,585 1,234 - 208,819 x € 1,000 31.12.2020 Interest < 1 year 1 <> 5 years > 5 years Total Non-interest bearing 195,628 - - 195,628 Fixed interest rate instruments 5% - 1,344 100 1,444 Cash and cash equivalents 38,870 - - 38,870 Closing balance at 31.12.2020 234,498 1,344 100 235,942 In 2021, there was no covenant breach related to the applicable covenants which belong to the prior loans and borrowings. Capital risk TherenancingoftheGroup,aspresentedinnote23,providestheCompanywith additionalsuretyandmaturityofitsnancingportfolioandastablebasisfortheyearsto come.Asthemajorityofthenancingagreementsareonanequalbasisandcentralised, this facilitates provide the possibility to further diversify the overall capital portfolio of the Company.Ingeneralourpolicyistopreserveahealthynancingstructurethatmaintains a balance between adequate solvency, the availability of adequate working capital and sufcientavailablefunding.TheCompany’sbalancesheetstructure,cashow generation, and available headroom remains strong over years. This enables us to continue to grow organically and through acquisitions. 176 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements The table below sets out the remuneration of the Supervisory Board: x € 1,000 2021 2020 Annual fee 292 255 292 255 Entities with joint control or signicant inuence over the entity The table below sets out the transactions with entities where the main shareholders and/ oroneormoreExecutiveBoardhavejointcontrolorsignicantinuenceovertheentity. The main shareholder and the Executive Board as well as the entities they control that are not part of the Group, are considered to be related parties. x € 1,000 31.12.2021 31.12.2020 Transaction value Balance outstanding Transaction value Balance outstanding Sales of products and services 10,674 337 7,584 1,800 Purchase of products and services 12,176 227 67,592 17,181 Premises rented 7,739 858 7,431 726 Other receivables - 231 - 231 Loans received - 1,500 - 1,500 Operating expenses 602 - 469 - Charged costs (1,923) 4,004 163 1,999 Additionally,in2020theGroupacquiredtheremaining49%ofthesharesofSTG Holding Import-Export S.L. from a related party, for a consideration at arm’s length of € 1,500,000. 32 Related party transactions The members of the Executive Board and the members of the Supervisory Board together are the key management of the Company. Remuneration of members of the Executive Board During 2021 the Executive Board consisted of the following members: Mr. T. de Haan Mr. P. Kruithof Mr. B.L.M. Schreuders Mr. N.G.P. Groen The table below sets out the remuneration of the Executive Board: x € 1,000 2021 2020 Gross salary 1,133 1,375 Social security charges 61 43 Pension charges 24 131 Severance payments - 1,718 Cash-settled share-based payments 75 - Variable short-term remuneration 600 524 1,893 3,791 Remuneration of members of the Supervisory Board During 2020 the Supervisory Board consisted of the following members: Mr. J.A. van Barneveld Mr. W.A. Blijdorp Mr. J.C. Beerman (until May 18, 2021) Mr. R.P.C. Cornelisse Ms. K. Koelemeijer Mr. L.D.H. Blijdorp (as per May 18, 2021) 177 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Diplomatic Supply Europe B.V. offers a wide range of products, expertise in customs and door-to-door delivery on a frequent basis to individual diplomats. The acquisition is fully consolidated from the date on which the Group gained control, which was July 29, 2021. The acquisition price is € 300,000. The acquisition is accounted for using the acquisition method. The assets acquired and liabilities recognised at the date of the acquisitions can be speciedasfollows: x € 1,000 Non-current assets Otherintangiblexedassets 297 Property, plant and equipment 24 Current assets Trade receivables 20 Other receivables 91 Cash and cash equivalents 8 Current liabilities Trade payables (50) Other current liabilities (2) Non-current liabilities Deferred tax liabilities (75) Borrowings (13) 300 Associated companies The associated companies consist of the following entities: Comptoir & Clos SAS, France (in liquidation) Capi-Lux South Africa (PTY) Ltd., South Africa STG Logistica Y Depositos S.L., Spain Next Generation Parfums B.V., the Netherlands The table below sets out the transactions with these companies: x € 1,000 31.12.2021 31.12.2020 Transaction value Balance outstanding Transaction value Balance outstanding Sales of products and services 413 88 866 126 Purchase of products and services 758 38 754 - Interest received on loans issued 40 - 10 - Loan - 150 - 150 33 Acquisitions DuringthenancialyeartheGroupacquiredthefollowingcompany: % Date Diplomatic Supply Europe B.V., the Netherlands 100% 29.07.2021 178 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Transactions under common control AtJune30,2021theGroupacquiredanadditional16.42%ofthesharesofJ.T.G. Holding B.V. and J.T.G. W.W.L. S.à r.l. for an amount of € 48,500,000 of which € 38,500,000 will be paid in January 2022. The difference between the acquisition price and the non-controlling interest in the assets and liabilities is accounted for in the retained earnings. At October 1, 2021 certain shares of subsidiaries of B&S HTG B.V. are transferred from B&S HTG B.V. to B&S Beauty B.V. at their carrying amount, by a share premium payment by B&S HTG B.V. to B&S Beauty B.V. At the same time, the Group acquired the remaining8.21%ofthesharesofJ.T.G.HoldingB.V.inreturnfor5%ofthesharesof B&S Beauty B.V. and an amount of € 934,000. The linked transaction took place at carrying amounts of the assets and liabilities, no revaluation to fair value took place. 34 Subsequent events There were no material events after December 31, 2021 that would have changed the judgementandanalysisbyManagementofthenancialconditionasatDecember31, 2021 or the result for the year of the Group. Nogoodwillarisesbasedontheacquisitions,whichcanbespeciedasfollows: x € 1,000 Total considerations 300 Less:fairvalueofidentiablenetassetsacquired (300) - The Group incurred acquisition-related costs of € 1 thousand on external legal fees and due diligence costs. The acquisition-related costs are included in the other operating expenses. Impact of acquisition The acquisition contributed € 315 thousand revenue and a loss of € 35 thousand to the Group’sprotfortheperiodbetweenthedateofacquisitionandthereportingdate.Ifthe acquisitionhadbeencompletedontherstdayofthenancialyear,Grouprevenuesfor theyearwouldhavebeen€467thousandhigherandGroupprotwouldhavebeen€66 thousand higher. Create experiences B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements 179 Other information 180 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Independent auditor’s report To the Shareholders of B&S Group S.A. 14, rue de Strachen L-6933 Mensdorf Grand Duchy of Luxembourg Report of the reviseur d’entreprises agree Report on the Audit of the consolidated nancial statements Opinion WehaveauditedtheconsolidatednancialstatementsofB&SGroupS.A.andits subsidiaries(the“Group”),whichcomprisetheconsolidatedstatementofnancial positionasatDecember31,2021,andtheconsolidatedstatementofprotorloss, consolidatedstatementofprotorlossandothercomprehensiveincome,consolidated statementofchangesinequityandconsolidatedstatementofcashowsfortheyear thenendedandnotestotheconsolidatednancialstatements,includingasummaryof signicantaccountingpolicies. Inouropinion,theaccompanyingconsolidatednancialstatementsgiveatrueandfair viewoftheconsolidatednancialpositionoftheGroupasatDecember31,2021,andof itsconsolidatednancialperformanceanditsconsolidatedcashowsfortheyearthen ended in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union. Basis for Opinion We conducted our audit in accordance with the EU Regulation Nº 537/2014, the Law of July 23, 2016 on the audit profession (Law of July 23, 2016) and with International Standards on Auditing (ISAs) as adopted for Luxembourg by the “Commission de Surveillance du Secteur Financier” (CSSF). Our responsibilities under the EU Regulation Nº 537/2014, the Law of July 23, 2016 and ISAs as adopted for Luxembourg by the CSSF are further described in the “Responsibilities of the “réviseur d’entreprises agréé” fortheAuditoftheconsolidatednancialstatements”sectionofourreport.Wearealso independent of the Group in accordance with the International Code of Ethics for Professional Accountants, including International Independence Standards, issued by the International Ethics Standards Board for Accountants (IESBA Code) as adopted for Luxembourg by the CSSF together with the ethical requirements that are relevant to our auditoftheconsolidatednancialstatements,andhavefullledourotherethical responsibilities under those ethical requirements. We believe that the audit evidence we haveobtainedissufcientandappropriatetoprovideabasisforouropinion. Key Audit Matters Key audit matters are those matters that, in our professional judgment, were of most signicanceinourauditoftheconsolidatednancialstatementsofthecurrentperiod. Thesematterswereaddressedinthecontextoftheauditoftheconsolidatednancial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Other information 181 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Related party transactions – Refer to Note 32 to the consolidated nancial statements Key audit matter description As disclosed in note 32, the Group has multiple transactions with related parties including but not limited to purchases of products and services amounting to EUR 12,176 thousand and rent of premises of EUR 7,739 thousand for the year ended December 31, 2021. These transactions are concluded with entities over which one or more Board membershave(joint)controlorsignicantinuence.TheSupervisoryBoardand Executive Board members as well as the entities they control that are not part of the Group are considered to be related parties. There is an inherent risk that transactions with these related parties do not comply with the arm’s length principle. Due to the number and size of the Group’s transactions with these related parties for the year ended December 31, 2021, and the potential magnitude of the implied risk of non-compliance with the arm’s length principle, we considered this area to be a key audit matter. How the Key Audit Matter was addressed in our audit? Our audit procedures included, but were not limited to: Obtaining an understanding of the Group’s related parties relationships and transactions Obtaining an understanding of the Group’s process for engaging in transactions with related parties as well as the design & implementation of related relevant controls Meeting with the Executive Board of Directors and Audit & Risk Committee and other executive management representatives to understand the business rationale andstatusofsignicantrelatedpartytransactions Obtaininginputfromspecialistsinrespecttotheidenticationofrelatedparties Reviewing the information prepared by the Group for ensuring that transactions of the Group with related parties are complete and also comply with the arm’s length principle Obtaining from the Group’s management the exhaustive list of the Group’s related parties Goodwill impairment test — Refer to Notes 3.8, 4 and 12 to the consolidated nancial statements Key audit matter description As disclosed in note 12, the Group’s goodwill balance amounts to € 65,092,000 as at December 31, 2021. In accordance with IFRS (IAS 36 Impairment of Assets) management is required to perform a yearly impairment test to ensure that the Group’s goodwill is not carried at a value exceeding its recoverable amount. The impairment assessmentissubjecttosignicantmanagementjudgementandestimationinthe following areas: assessmentanddeterminationoftheexpectedcashowsfromthebusinesses also considering the uncertainty associated with the unprecedented nature of the COVID-19 pandemic; setting appropriate terminal growth rates; and selection of the appropriate discount rate. The audit procedures carried out on the valuation of goodwill are regarded as a key audit matter as the valuation of goodwill is susceptible to management judgment and estimates and is based on assumptions that are affected by future market and economic conditions. How the matter was addressed in the audit? Our audit procedures included, but were not limited to: With the assistance of our Valuation Specialists, we have addressed the goodwill valuationbytestingtheassumptions,discountrates,methodologiesandnancialdata used.Specicfocuswasgiventothesensitivityintheavailableheadroomofcash- generating units (CGUs) where a reasonably possible change in the underlying assumption could cause the carrying amount to exceed its recoverable amount. We have also assessed management’s internal controls with regard to the goodwill impairment test. 182 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Responsibilities of the Executive Board of Directors and Those Charged with Governance of the Group for the consolidated nancial statements The Executive Board of Directors is responsible for the preparation and fair presentation oftheseconsolidatednancialstatementsinaccordancewithIFRSsasadoptedbythe European Union, and for such internal control as the Executive Board of Directors determinesisnecessarytoenablethepreparationofconsolidatednancialstatements that are free from material misstatement, whether due to fraud or error. Inpreparingtheconsolidatednancialstatements,theExecutiveBoardofDirectorsis responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Executive Board of Directors either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so. The Executive Board of Directors is responsible for presenting and marking up the consolidatednancialstatementsincompliancewiththerequirementssetoutinthe Delegated Regulation 2019/815 on European Single Electronic Format as amended (“the ESEF Regulation”). ThosechargedwithgovernanceareresponsibleforoverseeingtheGroup’snancial reporting process. Sharing this list with select component auditors requesting them: To report to the Group Audit Engagement Team any related party not included in this list as well as any transaction and / or relationship with related parties that was not disclosed to them as such To report to the Group Audit Engagement Team any event of non-compliance with the Group’s policies for transactions and relationships with related parties To identify all the component’s transactions with related parties and test, on a sample basis, related contracts for compliance with the arm’s length principles We also assessed the adequacy of the Group’s related party transactions disclosures in note32totheconsolidatednancialstatements. Other Information The Executive Board of Directors is responsible for the other information. The other information comprises the information stated in the consolidated management report and theCorporateGovernanceStatementbutdoesnotincludetheconsolidatednancial statements and our report of the “réviseur d’entreprises agréé” thereon. Ouropinionontheconsolidatednancialstatementsdoesnotcovertheother information and we do not express any form of assurance conclusion thereon. lnconnectionwithourauditoftheconsolidatednancialstatements,ourresponsibilityis to read the other information and, in doing so, consider whether the other information is materiallyinconsistentwiththeconsolidatednancialstatementsorourknowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information we are required to report this fact. We have nothing to report. 183 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements Conclude on the appropriateness of the Executive Board of Directors use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast signicantdoubtontheGroup’sabilitytocontinueasagoingconcern.Ifwe conclude that a material uncertainty exists, we are required to draw attention in our report of the “réviseur d’entreprises agréé” to the related disclosures in the consolidatednancialstatementsor,ifsuchdisclosuresareinadequate,tomodify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our report of the “réviseur d’entreprises agréé”. However, future events or conditions may cause the Group to cease to continue as a going concern. Evaluate the overall presentation, structure and content of the consolidated nancialstatements,includingthedisclosures,andwhethertheconsolidated nancialstatementsrepresenttheunderlyingtransactionsandeventsinamanner that achieves fair presentation. Obtainsufcientappropriateauditevidenceregardingthenancialinformationof the entities and business activities within the Group to express an opinion on the consolidatednancialstatements.Weareresponsibleforthedirection,supervision and performance of the Group audit. We remain solely responsible for our audit opinion. Ourresponsibilityisalsotoassesswhethertheconsolidatednancialstatementshave been prepared in all material respects with the requirements laid down in the ESEF Regulation. We communicate with those charged with governance regarding, among other matters, theplannedscopeandtimingoftheauditandsignicantauditndings,includingany signicantdecienciesininternalcontrolthatweidentifyduringouraudit. Responsibilities of the “réviseur d’entreprises agréé” for the Audit of the consolidated nancial statements The objectives of our audit are to obtain reasonable assurance about whether the consolidatednancialstatementsasawholearefreefrommaterialmisstatement, whether due to fraud or error, and to issue a report of the “réviseur d’entreprises agréé” that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the EU Regulation Nº 537/2014, the Law of July 23, 2016 and with ISAs as adopted for Luxembourg by the CSSF will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonablybeexpectedtoinuencetheeconomicdecisionsofuserstakenonthebasis oftheseconsolidatednancialstatements. As part of an audit in accordance with the EU Regulation Nº 537/2014, the Law of July 23, 2016 and with ISAs as adopted for Luxembourg by the CSSF, we exercise professional judgment and maintain professional scepticism throughout the audit. We also: Identifyandassesstherisksofmaterialmisstatementoftheconsolidatednancial statements, whether due to fraud or error, design and perform audit procedures responsivetothoserisks,andobtainauditevidencethatissufcientand appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Executive Board of Directors. 184 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements For the Group it relates to: Financial statements prepared in a valid xHTML format; TheXBRLmarkupoftheconsolidatednancialstatementsusingthecore taxonomyandthecommonrulesonmarkupsspeciedintheESEFRegulation. Inouropinion,theconsolidatednancialstatementsoftheGroupasatDecember31, 2021,identiedasB&SGroupS.A.AnnualReport2021iXBRLpack,havebeen prepared, in all material respects, in compliance with the requirements laid down in the ESEF Regulation. Weconrmthattheauditopinionisconsistentwiththeadditionalreporttotheaudit committee or equivalent. Weconrmthattheprohibitednon-auditservicesreferredtointheEURegulationN° 537/2014, on the audit profession were not provided and that we remain independent of the Group in conducting the audit. For Deloitte Audit, Cabinet de révision agréé Jan van Delden, Réviseur d’entreprises agréé Partner March 2, 2022 20 Boulevard de Kockelscheuer L-1821 Luxembourg Grand Duchy of Luxembourg We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied. From the matters communicated with those charged with governance, we determine thosemattersthatwereofmostsignicanceintheauditoftheconsolidatednancial statements of the current period and are therefore the key audit matters. We describe these matters in our report unless law or regulation precludes public disclosure about the matter. Report on Other Legal and Regulatory Requirements We have been appointed as Réviseur d’Entreprises Agréé by the General Meeting of the Shareholders on May 18, 2021 and the duration of our uninterrupted engagement, including previous renewals and reappointments, is four years. Theconsolidatedmanagementreportisconsistentwiththeconsolidatednancial statements and has been prepared in accordance with applicable legal requirements. The Corporate Governance Statement is included in the consolidated management report. The information required by Article 68ter paragraph (1) letters c) and d) of the law of December 19, 2002 on the commercial and companies register and on the accounting records and annual accounts of undertakings, as amended, is consistent with the nancialstatementsandhasbeenpreparedinaccordancewithapplicablelegal requirements. WehavecheckedthecomplianceoftheconsolidatednancialstatementsoftheGroup as at December 31, 2021 with the relevant statutory requirements set out in the ESEF Regulationthatareapplicabletonancialstatements. 185 B&S Group S.A. Annual Report 2021 Introduction About B&S Results Governance Financial statements SetoutbelowareB&SGroupS.A.’ssignicantsubsidiariesatDecember31,2021. Thedisclosedsignicantsubsidiariesrepresentthelargestsubsidiariesandrepresent approximate90%ofthetotalresultbeforetaxationoftheGroup.Allsubsidiariesare 100%ownedunlessstatedotherwise. Anker Amsterdam Spirits B.V., the Netherlands B&S B.V., the Netherlands B&SBeautyB.V.,theNetherlands(95%)(establishedAugust9,2021) B&S Brand Distribution B.V., the Netherlands B&S Foodservice B.V., the Netherlands B&SHTGB.V.,theNetherlands(95%) B&S International B.V., the Netherlands B&S Investments B.V., the Netherlands B&S LMCS DMCC, U.A.E. B&S New Horizons B.V., the Netherlands B&S Retail Holding B.V., the Netherlands B&S World Supply DMCC, U.A.E. Capi-Lux Netherlands B.V., the Netherlands Checkpoint Distribution B.V., the Netherlands F.C.T. B.V., the Netherlands FragranceNet.com Inc., U.S.A. HTG Liquors B.V., the Netherlands JTG B.V., the Netherlands J.T.G.HoldingB.V.,theNetherlands(2021:100%,2020:75.38%) Koninklijke Capi-Lux Holding B.V., the Netherlands LagaayMedicalGroupB.V.,theNetherlands(70%) New World Distribution DMCC, U.A.E. Paul Retail B.V., the Netherlands TopbrandsEuropeB.V.,theNetherlands(67.17%) World Class Products Group N.V., Netherlands Antilles B&S Group S.A. 14, Rue Strachen L-6933, Mensdorf G.D. Luxembourg Tel: +352 2687 0881 [link] List of subsidiaries Contact 549300PRNTIVQHLEZ8082021-01-012021-12-31549300PRNTIVQHLEZ8082020-01-012020-12-31549300PRNTIVQHLEZ8082021-12-31549300PRNTIVQHLEZ8082020-12-31549300PRNTIVQHLEZ8082020-12-31ifrs-full:IssuedCapitalMember549300PRNTIVQHLEZ8082021-01-012021-12-31ifrs-full:IssuedCapitalMember549300PRNTIVQHLEZ8082021-12-31ifrs-full:IssuedCapitalMember549300PRNTIVQHLEZ8082020-12-31ifrs-full:ReserveOfCashFlowHedgesMember549300PRNTIVQHLEZ8082021-01-012021-12-31ifrs-full:ReserveOfCashFlowHedgesMember549300PRNTIVQHLEZ8082021-12-31ifrs-full:ReserveOfCashFlowHedgesMember549300PRNTIVQHLEZ8082020-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember549300PRNTIVQHLEZ8082021-01-012021-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember549300PRNTIVQHLEZ8082021-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember549300PRNTIVQHLEZ8082020-12-31ifrs-full:RetainedEarningsMember549300PRNTIVQHLEZ8082021-01-012021-12-31ifrs-full:RetainedEarningsMember549300PRNTIVQHLEZ8082021-12-31ifrs-full:RetainedEarningsMember549300PRNTIVQHLEZ8082020-12-31ifrs-full:EquityAttributableToOwnersOfParentMember549300PRNTIVQHLEZ8082021-01-012021-12-31ifrs-full:EquityAttributableToOwnersOfParentMember549300PRNTIVQHLEZ8082021-12-31ifrs-full:EquityAttributableToOwnersOfParentMember549300PRNTIVQHLEZ8082020-12-31ifrs-full:NoncontrollingInterestsMember549300PRNTIVQHLEZ8082021-01-012021-12-31ifrs-full:NoncontrollingInterestsMember549300PRNTIVQHLEZ8082021-12-31ifrs-full:NoncontrollingInterestsMember549300PRNTIVQHLEZ8082019-12-31ifrs-full:IssuedCapitalMember549300PRNTIVQHLEZ8082020-01-012020-12-31ifrs-full:IssuedCapitalMember549300PRNTIVQHLEZ8082019-12-31ifrs-full:ReserveOfCashFlowHedgesMember549300PRNTIVQHLEZ8082020-01-012020-12-31ifrs-full:ReserveOfCashFlowHedgesMember549300PRNTIVQHLEZ8082019-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember549300PRNTIVQHLEZ8082020-01-012020-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember549300PRNTIVQHLEZ8082019-12-31ifrs-full:RetainedEarningsMember549300PRNTIVQHLEZ8082020-01-012020-12-31ifrs-full:RetainedEarningsMember549300PRNTIVQHLEZ8082019-12-31ifrs-full:EquityAttributableToOwnersOfParentMember549300PRNTIVQHLEZ8082020-01-012020-12-31ifrs-full:EquityAttributableToOwnersOfParentMember549300PRNTIVQHLEZ8082019-12-31ifrs-full:NoncontrollingInterestsMember549300PRNTIVQHLEZ8082020-01-012020-12-31ifrs-full:NoncontrollingInterestsMember549300PRNTIVQHLEZ8082019-12-31iso4217:EURiso4217:EURxbrli:shares
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