Annual Report (ESEF) • Jun 1, 2023
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Download Source FileUntitled ANNUAL R EPORT 2022/2023 HOLLAND COLOURS ANNUAL REPORT 2022/2023 3 WE ARE HOLLAND COLOURS ''At Holland Colours, every employee is a co-owner, and owners know that the rst step to success begins with adding value for our customers.'' CONTENTS Introduction by the CEO 5 About Holland Colours 6 Report of the Board of Management 14 Environmental, Social and Governance (ESG) 38 Corporate Governance 49 Report of the Supervisory Board 55 Remuneration Report 62 Employee Participation 66 Five-Year Summary 68 Investor Relations 69 Financial Statements 72 Other Information 113 Independent Auditor’s Report 114 Contact 127 HOLLAND COLOURS 4 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSABOUT DEAR SHAREHOLDERS, EMPLOYEES, CLIENTS AND BUSINESS PARTNERS, INTRODUCTION BY THE CEO Coen Vinke CEO HOLLAND COLOURS 55 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS ABOUT HOLLAND COLOURS 44 YEARS 400 EMPLOYEES SINCE 1979 NETWORK OF 100 GLOBAL SUPPLIER 2 BILLION KG As a company, we set out to deliver customer peace of mind through superior product performance, world-leading product stewardship, and outstanding technical service. Our experts co-design color and functional solutions with our customers, develop solutions to support recycling, and actively contribute to creating a more sustainable industry overall. OUR PROFILE HOLLAND COLOURS ANNUAL REPORT 2022/2023 6 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSABOUT More than 40 years ago, the founders of Holland Colours set to work in an old paper factory in Apeldoorn, the Netherlands. A small but ambitious team, they had an idea that would ultimately disrupt the world of colors – and earn them the description ‘pioneers.’ Today, we are one global team of over 400 colleagues with dierent experiences and from various backgrounds. But we all share the same core values, passion for color, commitment to our customers and pride in our company. OUR HERITAGE Holland Colours NV Apeldoorn, the Netherlands Surabaya, Indonesia Shanghai, China Richmond, Indiana United States Szolnok, Hungary Toronto, Canada Tultitlán, Mexico Gillingham, United Kingdom Jakarta Sales Production/Sales Representative Oce HOLLAND COLOURS ANNUAL REPORT 2022/2023 7 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSABOUT HOLCOBATCH ® HOLCOLEX HOLCOPRILL HOLCOSIL HOLCOPEARL ® HOLCOMER OUR PRODUCTS 8 8 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSABOUT TINTMASK TASTEGUARD FASTHEAT SORT HOLCOBATCH® CLASSIC MARKIT NATURAL COLLECTION HOLCOMER THERMOSTRETCH OUR SOLUTIONS Strong, lightweight and moldable, plastics are used in thousands of products that add comfort, convenience and safety to our daily lives. Plastic helps to prevent food waste with excellent sealing and enhanced durability and is widely used instead of wood by the building and construction industry. Adding color to plastic and coatings creates emotion, aects behavior, aids identication and supports safety, depending on the purpose and application. Together with our customers, we co-design sustainable colorants and additives that are ecient, eective and esthetic. A part of our products is based on a bio-based carrier technology. 9 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSABOUT Building and construction Packaging Coatings & sealants OUR MARKETS OUR MISSION Our mission is two-fold: TO BE RECOGNIZED AS A CONTRIBUTOR TO THE DEVELOPMENT OF A SUSTAINABLE INDUSTRY TO BE OUR CUSTOMERS’ CO-DESIGNER OF COLOR AND FUNCTIONAL SOLUTIONS 10 ESG GOVERNANCEMANAGEMENT BOARD REPORT INTRODUCTION BY THE CEO SUPERVISORY BOARD REPORT REMUNERATION REPORT EMPLOYEE PARTICIPATION FIVE-YEAR SUMMARY & INVESTOR RELATIONS FINANCIAL STATEMENTSABOUT OUR CORE VALUES: PROVIDING A FRAMEWORK FOR SUCCESS Our ve core values underpin everything we do as a company. They are part of our DNA and determine how we behave and what we are like as people and as an organization. The values are based on the insight that as the market for colorants becomes more competitive, and good products become the rule rather than the exception, successful companies will need to nd additional ways to dierentiate themselves. Pro-activeness Responsibility Competence Teamwork Accountability 1111 SUPERVISORY BOARD REPORTESG REMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORT INTRODUCTION BY THE CEO ABOUT FIVE-YEAR SUMMARY & INVESTOR RELATIONSEMPLOYEE PARTICIPATION FINANCIAL STATEMENTS OUR DIFFERENTIATORS HOLLAND COLOURS 12 FIVE-YEAR SUMMARY & INVESTOR RELATIONSEMPLOYEE PARTICIPATIONREMUNERATION REPORT FINANCIAL STATEMENTSSUPERVISORY BOARD REPORTGOVERNANCEESGMANAGEMENT BOARD REPORT INTRODUCTION BY THE CEO ABOUT Plenty of companies oer their employees shares in the business. Typically, it’s seen as an employee benet: a chance to share in the prots. We don’t just do that at Holland Colours. We go further. Here’s what that means to us. EMPLOYEE PARTICIPATION DRIVES OUR SUCCESS A CULTURE BASED ON CONNECTION, COLLABORATION AND SUSTAINABILITY EMPLOYEE PARTICIPATION HOLLAND COLOURS ANNUAL REPORT 2022/2023 13 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSABOUT REPORT OF THE BOARD OF MANAGEMENT HOLLAND COLOURS ANNUAL REPORT 2022/2023 14 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT BOARD OF MANAGEMENT CFO ad interim Joined Holland Colours NV CTO Joined Holland Colours NV Appointment to position (second term) CEO Joined Holland Colours NV Appointment to position (second term) HOLLAND COLOURS ANNUAL REPORT 2022/2023 15 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT A CHALLENGING YEAR CHALLENGES Growing Together 2023 OPPORTUNITIES OPPORTUNITIES INTRODUCTION HOLLAND COLOURS ANNUAL REPORT 2022/2023 16 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT HOLCOPEARL – DARK COLOR SIDING HOLCOPEARL – SOLIDS FOR COATINGS Product innovations 17 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT UPDATE GROWING TOGETHER 2023 Growing Together 2023 DELIVERING GROWTH Strategy 2023 Our strategic goals: • • • Our overall objectives: • • • • • • HOLLAND COLOURS ANNUAL REPORT 2022/2023 18 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT DELIVERING EXCELLENCE Innovation excellence Growing Together 2023, Commercial excellence Operational excellence People excellence HOLLAND COLOURS ANNUAL REPORT 2022/2023 19 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT FINANCIAL KEY FIGURES 2021/20222022/2023 0.8% 111.4 110.5 2021/20222022/2023 –46.3% 7.3 13.6 2022/2023 2021/2022 2022/2023 2021/2022 2022/2023 2021/2022 2022/2023 2021/2022 2022/2023 2021/2022 2022/2023 2021/2022 6.6% 15.8% €6.82 7.0% 20% 79.7% 12.3% 34.2% €11.83 7.9% 24% 72.5% 2021/20222022/2023 –42.2% 5.9 10.2 HOLLAND COLOURS ANNUAL REPORT 2022/2023 20 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT FINANCIAL PERFORMANCE 2022/2023 2021/2022 Change EMEIA HOLLAND COLOURS ANNUAL REPORT 2022/2023 21 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS MANAGEMENT BOARD REPORT AMERICAS ASIA INVESTMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 22 EMEIA in EUR millions Americas in USD millions Asia in USD millions 2022/2023 2021/2022 2022/2023 2021/2022 2022/2023 2021/2022 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT CASH FLOW FINANCIAL REPORTING PROCESS RECRUITMENT DIVERSITY COMPLIANCE HOLLAND COLOURS ANNUAL REPORT 2022/2023 23 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS MANAGEMENT BOARD REPORT MARKET OPPORTUNITIES INNOVATION PROGRAM PRODUCT STEWARDSHIP PRODUCT INNOVATION HOLLAND COLOURS ANNUAL REPORT 2022/2023 24 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT ENVIRONMENTAL, SOCIAL INNOVATION INDEX HOLLAND COLOURS ANNUAL REPORT 2022/2023 25 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT HOLLAND COLOURS RISK AREAS Risk Severity Risk Likelihood Risk Level * *** *** *** ** ** ** * * * RISK HOLLAND COLOURS ANNUAL REPORT 2022/2023 26 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT Gross Net Risk Severity Risk Likelihood Risk Level Risk Level Strategic ** ** ** ** ** *** *** ** ** *** ** Compliance ** *** ** ** *** ** • ** *** *** ** • ** *** *** ** • ** *** *** * • ** *** *** ** Financial * * * * *** ** *** * We dierentiate between gross and net risk levels. Net risks are the risks that remain once mitigation steps have been taken. HOLLAND COLOURS ANNUAL REPORT 2022/2023 27 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT Gross Net Risk Severity Risk Likelihood Risk Level Risk Level Operational *** *** *** ** *** * ** *** *** *** ** * ** * Political ** *** *** Sustainability ** *** *** * ** *** *** ** HOLLAND COLOURS ANNUAL REPORT 2022/2023 28 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT Gross Net Risk Severity Risk Likelihood Risk Level Risk Level ** ** ** ** ** *** *** ** ** *** ** SIZE OF OUR CURRENT STRATEGIC SEGMENTS PLUS COMPETITIVE RIVALRY HOLLAND COLOURS ANNUAL REPORT 2022/2023 29 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT CYBERSECURITY BUSINESS AGILITY 30 SUPERVISORY BOARD REPORTESG GOVERNANCEABOUT INTRODUCTION BY THE CEO FIVE-YEAR SUMMARY & INVESTOR RELATIONSEMPLOYEE PARTICIPATIONREMUNERATION REPORT FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT Gross Net Risk Severity Risk Likelihood Risk Level Risk Level ** *** ** ** *** ** • ** *** *** ** • ** *** *** ** • ** *** *** * • ** *** *** ** LAWS AND REGULATIONS HOLLAND COLOURS ANNUAL REPORT 2022/2023 31 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT ETHICS FRAUD Product pricing Authorization matrix Gifts from/to relations Agency commissions HOLLAND COLOURS ANNUAL REPORT 2022/2023 32 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT Gross Net Risk Severity Risk Likelihood Risk Level Risk Level * * * * *** ** *** * LIQUIDITY OTHER FINANCIAL (CURRENCY, INTEREST RATES, CAPITAL STRUCTURE) HOLLAND COLOURS ANNUAL REPORT 2022/2023 33 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT Gross Net Risk Severity Risk Likelihood Risk Level Risk Level *** *** *** ** *** * ** *** *** *** ** * ** * SAFETY SUPPLY INTELLECTUAL PROPERTY HUMAN RESOURCES QUALITY HOLLAND COLOURS ANNUAL REPORT 2022/2023 34 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT Gross Net Risk Severity Risk Likelihood Risk Level Risk Level ** *** *** GLOBAL ECONOMY AND POLITICS HOLLAND COLOURS ANNUAL REPORT 2022/2023 35 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT Gross Net Risk Severity Risk Likelihood Risk Level Risk Level ** *** *** * ** *** *** ** PROCESS AND PRODUCT HOLLAND COLOURS ANNUAL REPORT 2022/2023 36 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT In accordance with provision 1.4.3 of the Code and Section 5:25c of the Dutch Financial Supervision Act, the Board of Management declares that, to the best of its knowledge: • • • • • Board of Management OUTLOOK DECLARATION OF THE BOARD OF MANAGEMENT HOLLAND COLOURS ANNUAL REPORT 2022/2023 37 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSMANAGEMENT BOARD REPORT SOCIAL AND GOVERNANCE HOLLAND COLOURS ANNUAL REPORT 2022/2023 38 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORT EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSESG 2021: Dened our ambition • • In 2021, we began integrating Environmental, Social and Governance (ESG) criteria into our wider company strategy. ESG is the follow-on to CSR, or Corporate Social Responsibility commitment, and the term is being adopted by more and more European companies, in line with evolving EU regulations. As such, although the terminology is new, many of the ideas it covers are already familiar and central to Holland Colours. ESG ROADMAP 2021-2025 2022: Transition GRI reporting to CSRD rules • • • • 2025: Future-proof • • 2023-2024: Integrate ESG into our strategy, decision-making and reporting • • • • • HOLLAND COLOURS ANNUAL REPORT 2022/2023 39 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORT EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSESG • • • • THE SAFETY CULTURE LADDER SAFETY PERFORMANCE IN 2022/2023 Safety 2022/2023 2021/2022 HOLLAND COLOURS ANNUAL REPORT 2022/2023 40 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS 1 The company’s attitude is that it doesn’t have accidents so doesn’t need to invest in safety. 2 The company generally only tightens safety after something has gone wrong and employees do not generally feel responsible for their own or their colleagues’ safety. 3 The company pays attention to health and safety and has clear safety rules, but safety is seen mostly as a senior management task. 5 Safety is a standard part of contractors’ operational processes as well, and safety is ingrained in the thinking and behavior of all employees. 4 Safety is a top priority and is treated proactively within the company’s operations. Along with structural investments in raising safety awareness, employees are encouraged to raise unsafe behavior with each other. SAFETY CULTURE LADDER We are determined to provide a safe and healthy working environment. We therefore aim for zero accidents. We continuously train our people and work to create the right conditions so each of us can do our best every day. As part of this, we encourage everyone to report not only accidents and incidents but near misses as well. Near misses are things we see or experience that are or could be dangerous, but which thankfully have not led to an accident. Therefore, the more near misses we report, the fewer incidents and accidents there will be as it means we can act to prevent them. HOLLAND COLOURS ANNUAL REPORT 2022/2023 41 FIVE-YEAR SUMMARY & INVESTOR RELATIONS FINANCIAL STATEMENTSMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO SUPERVISORY BOARD REPORT EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEESG FIVE-YEAR SUMMARY & INVESTOR RELATIONS FINANCIAL STATEMENTS AN ALWAYS-IMPORTANT ELEMENT THAT IS MORE RELEVANT THAN EVER FOCUS AREAS AND THE LINK BETWEEN OUR SDG GOALS AND ESG HOLLAND COLOURS ANNUAL REPORT 2022/2023 42 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORT EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSESG FOCUS AREAS Based on the selected SDGs, we dened three focus areas: We invest at least 2% per year of our personnel expenses in responsible care for our employees. This investment is used to deliver training, for individual and team development and/or as time that can be spent on local social aid activities. By 2030, we will have reduced the CO 2 impact of our operational activities by between 30% and 50%. We will structurally increase our annual investment in innovation. By 2030, 90% of our revenue will be based on products that contribute to sustainability. We protect the safety, health and welfare of HCA employees and oer development opportunities to all. Given our geographical spread, we consider it important to employ nationally. We service our customers with products that are produced regionally, and we design our processes to support the sustainable use of energy and raw materials. Together with our customers and partners, we co-create sustainable solutions and develop products that enable recycling, the reduction of food waste and the reduction of energy consumption. WE ENVISION A COLORFUL WORLD IN WHICH WEARE THE WINNING SUSTAINABLE SOLUTION HOLLAND COLOURS ANNUAL REPORT 2022/2023 43 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORT EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSESG A NEW BASELINE AND ACTION PLAN OUR PEOPLE Better Together Dialogues Other personal development opportunities 1. 2. 3. HOLLAND COLOURS ANNUAL REPORT 2022/2023 44 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORT EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSESG HOLLAND COLOURS ANNUAL REPORT 2022/2023 45 SUPERVISORY BOARD REPORTESG GOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FIVE-YEAR SUMMARY & INVESTOR RELATIONSEMPLOYEE PARTICIPATIONREMUNERATION REPORT FINANCIAL STATEMENTSESG OUR PROCESSES • Scope 1 emissions • Scope 2 emissions • Scope 3 emissions HOLLAND COLOURS ANNUAL REPORT 2022/2023 46 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORT EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSESG ESG 2021/2022 2021/2022 21/22 21/22 21/22 2021/2022 2022/2023 2022/2023 22/23 22/23 22/23 CO CO CO 2022/2023 2021/2022 2022/2023 2021/2022 30 4111 23 36 5216 23 760 8,067 1,408 4,809 1,851 674 8,794 1,829 5,317 1,649 490 + = 25 20 Employees Management HOLLAND COLOURS ANNUAL REPORT 2022/2023 47 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSESG By reporting on all three scopes, we can better understand and manage our carbon footprint. We are implementing strategies to reduce emissions across all scopes. These include investing in renewable energy sources and working with our suppliers to improve their sustainability practices. We are also engaging with our employees to promote sustainable behaviors and oering training to help them reduce their carbon footprint both at work and at home. Our objective mentioned on page 43 is being reviewed due to a denition change and the ongoing strategic review. Our commitment to reducing our carbon footprint and managing our emissions is an ongoing eort, and we will continue to monitor and report on our progress in our annual reports. Employing the newly adopted analysis in place of the earlier methodology that was used in 2021/2022, we can improve our understanding and so management of our carbon footprint. We will use the new analytical approach going forward. Under the new methodology, the emission per kg of product increases from 674g CO 2 equiv/kg to 760g CO 2 equiv/kg. The principle reason for this increase is the return of business travel following COVID-19, waste and the lower production volumes we saw in 2022/2023. The overall CO 2 -equivalent impact of the organization fell by approximately 10%. OUR PRODUCTS Sustainability is moving from a nice-to-have extra to a key driver for innovation in our industry. The whole materials market is facing a fundamental shift from fossil fuels to sustainable alternatives, and from use-once consumerism to reuse and full circularity. Logistics, economies of scale, the location and availability of raw materials and the unpredictability of geopolitics are also factors in this trend. This shift forms part of our current strategic review. In 2022/2023, we continued to build our understanding of where we stand and to develop a more detailed insight into where our client needs lie. We continued to reach out to our suppliers to learn more about how they develop their products and to explain, where necessary, the importance of including the sustainability impact of their products on what we make and innovate. We also began analyzing the sustainability performance of our product portfolio. For this we dened a sustainable product as being one that meets one of the following three criteria while not performing signicantly worse in the other criteria. At Holland Colours, a sustainable product: • either has a lower CO 2 /kg equivalent impact than the main solution in a specific subsegment (cradle to gate); or • it enables our customer to have a lower CO 2 /kg equivalent impact in their production vs. the main alternative solution; or • it supports the increased recycling of materials. The analysis of the rst series of products led to the conclusion that some 20% of our product portfolio can be dened as 100% sustainable. Product analyzed on sustainability ● Analyzed ● Not analyzed 100% sustainable HOLLAND COLOURS ANNUAL REPORT 2022/2023 48 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSESG CORPORATE GOVERNANCE Holland Colours is a limited liability company with common shares publicly listed on the Euronext Amsterdam stock exchange. ANNUAL GENERAL MEETING OF SHAREHOLDERS HOLLAND COLOURS ANNUAL REPORT 2022/2023 49 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSGOVERNANCE • • • • • • • • • DIVERSITY POLICY Tone at the top Safe environment HOLLAND COLOURS ANNUAL REPORT 2022/2023 50 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSGOVERNANCE Terms of employment Recruitment Developments in 2022/2023 COMMITTEES Audit Committee Remuneration Committee ANTI-TAKEOVER PROVISIONS AND CONTROL BILATERAL CONTACTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 51 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSGOVERNANCE CODE OF CONDUCT BOARD OF MANAGEMENT SUPERVISORY BOARD MEMBERS INTERNAL AUDIT FUNCTION HOLLAND COLOURS ANNUAL REPORT 2022/2023 52 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSGOVERNANCE COMPANY SECRETARY CONFLICTS OF INTEREST SHAREHOLDER POWERS HOLLAND COLOURS ANNUAL REPORT 2022/2023 53 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSGOVERNANCE In Holland Colours NV In Holland Pigments BV March 31, 2023 Supervisory Board Board of Management March 31, 2022 Supervisory Board Board of Management HOLLAND COLOURS ANNUAL REPORT 2022/2023 54 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSGOVERNANCE REPORT OF THE SUPERVISORY BOARD HOLLAND COLOURS ANNUAL REPORT 2022/2023 55 FIVE-YEAR SUMMARY & INVESTOR RELATIONSESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS SUPERVISORY BOARD Chairman Date of initial appointment Term of oce • Member Date of initial appointment Term of oce • Member Date of initial appointment Term of oce • Deputy Chairman Date of initial appointment Term of oce • • • • HOLLAND COLOURS ANNUAL REPORT 2022/2023 56 FIVE-YEAR SUMMARY & INVESTOR RELATIONSESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSSUPERVISORY BOARD REPORT The global events of the past 12 months were felt in every region in which Holland Colours is active. While the world was still recovering from the COVID-19 pandemic, Russia’s invasion of Ukraine triggered new and unexpected threats to global economics and politics. As well as its awful humanitarian impact, the war created serious uncertainties for business, including Holland Colours. We saw large uctuations in customer demand and rapid and repeated increases in the price of raw materials. COMPOSITION OF THE SUPERVISORY BOARD COMPOSITION OF THE BOARD OF MANAGEMENT BOARD MEETINGS AND CONTACTS DEVELOPMENTS AND STRATEGY HOLLAND COLOURS ANNUAL REPORT 2022/2023 57 FIVE-YEAR SUMMARY & INVESTOR RELATIONSESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSSUPERVISORY BOARD REPORT Continuing investment Risk Matrix Code of Conduct and compliance Russia/Ukraine Focus on sustainability Acting as one company HOLLAND COLOURS ANNUAL REPORT 2022/2023 58 FIVE-YEAR SUMMARY & INVESTOR RELATIONSESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSSUPERVISORY BOARD REPORT RISK MANAGEMENT PERFORMANCE EVALUATION ALLOCATION OF DUTIES AUDIT COMMITTEE HOLLAND COLOURS ANNUAL REPORT 2022/2023 59 FIVE-YEAR SUMMARY & INVESTOR RELATIONSESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSSUPERVISORY BOARD REPORT REMUNERATION COMMITTEE DIVERSITY POLICY ANNUAL REPORT AND DIVIDEND PROPOSAL HOLLAND COLOURS ANNUAL REPORT 2022/2023 60 FIVE-YEAR SUMMARY & INVESTOR RELATIONSESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS SUPERVISORY BOARD REPORT ACKNOWLEDGEMENTS Supervisory Board HOLLAND COLOURS ANNUAL REPORT 2022/2023 61 FIVE-YEAR SUMMARY & INVESTOR RELATIONSESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSSUPERVISORY BOARD REPORT REMUNERATION REPORT REMUNERATION FRAMEWORK • • • HOLLAND COLOURS ANNUAL REPORT 2022/2023 62 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSREMUNERATION REPORT SHORT- AND LONG-TERM INCENTIVE PLANS STI AND LTI TARGET-SETTING PROCESS HOLLAND COLOURS ANNUAL REPORT 2022/2023 63 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSGOVERNANCE REMUNERATION REPORTSUPERVISORY BOARD REPORT PROFIT-SHARING PLAN SCENARIO ANALYSES INDIVIDUAL REMUNERATION OF THE BOARD OF MANAGEMENT Board of Management Fixed remuneration Variable remuneration Total remuneration Base salary Pension plan Proportion of variable remuneration (in %) CEO CTO Total 548 53 87 688 13 HOLLAND COLOURS ANNUAL REPORT 2022/2023 64 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS REMUNERATION REPORT INDIVIDUAL REMUNERATION OF THE SUPERVISORY BOARD OVER THE LAST 5 YEARS Annual change 2022/23 21/22 > 22/23 20/21 > 21/22 19/20 > 20/21 18/19 > 19/20 Total 141 25 – – – CHANGES IN THE REMUNERATION PER MEMBER OF THE BOARD OF MANAGEMENT AND COMPANY PERFORMANCE Annual change Fixed and variable 2022/23 21/22 > 22/23 20/21 > 21/22 19/20 > 20/21 18/19 > 19/20 Board of Management remuneration Company performance Average remuneration on a full-time equivalent basis of employees REMUNERATION OF THE SUPERVISORY BOARD HOLLAND COLOURS ANNUAL REPORT 2022/2023 65 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSREMUNERATION REPORTSUPERVISORY BOARD REPORT Employee Participation is central to the way we manage our company and is the foundation of our success. You can read more about the culture it supports in our Prole story on page 13. Here we explain how co-ownership works. Every permanent employee of Holland Colours owns shares (at least one) in Holland Pigments BV, The goal of Holland Pigments and the four majority shareholders is to promote the stability, continuity and independence of Holland Colours, including eective employee participation within the Holland Colours Group Holland Pigments holds the majority (50.52%) of the shares in Holland Colours. Holland Pigments is managed by a one-tier board The non-executive board member for employee-shareholders and the executive director of Holland Pigments are jointly responsible for managing the employee- shareholder model properly. EMPLOYEE PARTICIPATION IN PRACTICE HOLLAND COLOURS ANNUAL REPORT 2022/2023 66 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTESG REMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSEMPLOYEE PARTICIPATION HOLLAND COLOURS ANNUAL REPORT 2022/2023 67 ABOUT INTRODUCTION BY THE CEO INTRODUCTION BY THE CEO ABOUT ESG FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORT EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORT FINANCIAL STATEMENTS SUMMARY IN MILLIONS OF EUROS, UNLESS STATED OTHERWISE 2022/23 2021/22 2020/21 2019/20 2018/19 Income statement Statement of nancial position 2022/23 2021/22 2020/21 2019/20 2018/19 Statement of cash ows Revenue per division EMEIA Ratios HOLLAND COLOURS ANNUAL REPORT 2022/2023 68 ESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS FIVE-YEAR SUMMARY & INVESTOR RELATIONS SUPERVISORY BOARD REPORT INVESTOR RELATIONS Total 860,351 Disclosures % Date HOLLAND COLOURS ANNUAL REPORT 2022/2023 69 SUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSFIVE-YEAR SUMMARY & INVESTOR RELATIONS 90 40 140 190 240 04 05 06 07 08 09 10 11 12 01 02 03 2022 2023 SHARE PRICES – HOLLAND COLOURS VERSUS ASCX 60 40 20 0 80 100 120 140 160 180 04 05 06 07 08 09 10 11 12 01 02 03 Holland Colours NV ASCX Index 2022 2023 2022/2023 2021/2022 2020/2021 2019/2020 2018/2019 SHARE PRICES – HOLLAND COLOURS HOLLAND COLOURS ANNUAL REPORT 2022/2023 70 ESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSFIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORT HOLLAND COLOURS ANNUAL REPORT 2022/2023 71 SUPERVISORY BOARD REPORTESG EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSFIVE-YEAR SUMMARY & INVESTOR RELATIONS FINANCIAL STATEMENTS FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 72 Consolidated Income Statement 74 Consolidated Statement of Comprehensive Income 75 Consolidated Balance Sheet 76 Consolidated Statement of Changes in Equity 77 Consolidated Cash Flow Statement 78 Notes to the Consolidated Financial Statements 79 1. General Information 79 2. Going concern 79 3. Summary of Accounting Principles 79 4. Financial Risk Management 87 5. Cash Flow Statement 88 6. Segment Information 88 7. Revenue 90 8. Personnel Expenses 90 9. Other Operating Expenses 90 10. Finance Income and Expense 91 11. Income Tax 91 12. Intangible Assets 92 13. Property, Plant and Equipment 93 14. Right-of-Use Assets 94 15. Deferred Income Tax Assets and Liabilities 94 16. Inventory 95 17. Trade and Other Receivables 96 18. Cash and Cash Equivalents 97 19. Share Capital 97 20. Other Reserves 97 21. Earnings per Share 97 22. Non-Controlling Interest 98 23. Credit Facility 98 24. Lease Liabilities 98 25. Employee Benefit Obligations 99 26. Trade and Other Liabilities 100 Other Disclosures 101 27. Contingent Assets and Liabilities 101 28. Related Parties 101 29. Other Disclosures 103 Company Income Statement 104 Company Balance Sheet 105 Notes to the Company Financial Statements 106 30. General Information 106 31. Summary of Accounting Principles 106 32. Subsidiaries 106 33. Personnel Expenses 106 34. Income Tax 106 35. Intangible Assets 107 36. Property, Plant and Equipment 108 37. Right-of-Use Assets 109 38. Financial Non-Current Assets 109 39. Equity 110 40. Credit Facility 110 41. Lease Liabilities 110 42. Employee Benefit Obligations 111 43. Audit Fees 111 44. Other Disclosures 112 Other Information 113 Statutory Provisions regarding the Appropriation of Profits 113 Independent Auditor’s Report 114 CONTENTS FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 73 In thousands of euros Note April 1, 2022/March 31, 2023 April 1, 2021/March 31, 2022 Revenue 7 111,438 110,465 Cost of Materials (62,938) (58,827) Direct Contribution Margin 48,500 51,638 Personnel Expenses 8 (23,374) (22,370) Amortization and Impairments 12 (64) (87) Depreciation and Impairments 13/14 (3,189) (3,325) Other Operating Expenses 9 (14,580) (12,226) Total Operating Expenses (41,207) (38,008) Operating Result 7,293 13,630 Finance Income 10 229 94 Finance Expense 10 (308) (180) Finance Income and Expense (79) (86) Result Before Income Tax 7,214 13,544 Income Tax 11 (1,345) (3,301) Net Result 5,869 10,243 Attributable to: • Shareholders of the Company 5,869 10,179 • Non-Controlling Interest 22 – 64 5,869 10,243 Earnings per Share in euros Average Number of Shares Issued 21 860,351 860,351 Earnings per Share from Total Net Result 6.82 11.83 CONSOLIDATED INCOME STATEMENT FOR THE FINANCIAL YEAR ENDED MARCH 31, 2023 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 74 Notes 1 to 29 are an integral part of these consolidated financial statements. In thousands of euros Note April 1, 2022/March 31, 2023 April 1, 2021/March 31, 2022 Net Result 5,869 10,243 Items that will not be reclassified to the Income Statement Actuarial Results on Employee Benefits, after Tax 25 27 82 Other Comprehensive Income that could in future be classified to the Income Statement Foreign Currency Translation Differences 20 715 1,558 Other Comprehensive Income 742 1,640 Total Comprehensive Income 6,611 11,883 Attributable to: • Shareholders of the Company 6,611 11,804 • Non-Controlling Interest – 79 6,611 11,883 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE FINANCIAL YEAR ENDED MARCH 31, 2023 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 75 Notes 1 to 29 are an integral part of these consolidated financial statements. CONSOLIDATED In thousands of euros Note March 31, 2023 March 31, 2022 Non-Current Assets Intangible Assets 12 5 69 Property, Plant and Equipment 13 22,327 20,817 Right-of-Use Assets 14 974 1,247 Deferred Tax Assets 15 1,047 1,415 Long-Term Receivables – – 24,353 23,548 Current Assets Inventory 16 15,565 20,598 Trade and Other Receivables 17 16,588 18,145 Income Tax Receivables 1,492 366 Cash and Cash Equivalents 18 15,757 16,959 49,402 56,068 Total Assets 73,755 79,616 In thousands of euros Note March 31, 2023 March 31, 2022 Equity Share Capital 19 1,953 1,953 Share Premium Reserve 1,219 1,219 Other Reserves 20 506 (18) Retained Earnings 55,135 54,176 Equity Attributable to Shareholders of the Company 21 58,813 57,330 Non-Controlling Interest 22 – 420 Total Equity 58,813 57,750 Non-Current Liabilities Lease Liabilities 24 441 744 Employee Benefit Obligations 25 854 1,105 Deferred Tax Liabilities 15 106 273 1,401 2,122 Current Liabilities Lease Liabilities 24 439 535 Trade and Other Liabilities 26 12,786 17,392 Income Tax Liabilities 124 1,729 Employee Benefit Obligations 25 192 88 13,541 19,744 Total Equity and Liabilities 73,755 79,616 BALANCE SHEET AS OF MARCH 31, 2023 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 76 Notes 1 to 29 are an integral part of these consolidated financial statements. In thousands of euros Equity attributable to Shareholders of the Company Share Capital Share Premium Reserve Foreign Currency Translation Reserve Legal Reserve for Intangible Assets Retained Earnings Total Non- Controlling Interest Total Equity As at March 31, 2021 1,953 1,219 (1,752) 119 48,719 50,258 341 50,599 Net Result for the Financial Year – – – – 10,179 10,179 64 10,243 Other Comprehensive Income – – 1,543 – 82 1,625 15 1,640 Total Comprehensive Income – – 1,543 – 10,261 11,804 79 11,883 Transfer of Reserve for Intangible Assets – – – 72 (72) – – – Dividends Paid – – – – (4,732) (4,732) – (4,732) As at March 31, 2022 1,953 1,219 (209) 191 54,176 57,330 420 57,750 Net Result for the Financial Year – – – – 5,869 5,869 – 5,869 Other Comprehensive Income – – 715 – 27 742 – 742 Total Comprehensive Income – – 715 – 5,896 6,611 – 6,611 Transfer of Reserve for Intangible Assets – – – (191) 191 – – – Buyout of minority shareholder – – – – – – (420) (420) Dividends Paid – – – – (5,128) (5,128) – (5,128) As at March 31, 2023 1,953 1,219 506 – 55,135 58,813 – 58,813 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE FINANCIAL YEAR ENDED MARCH 31, 2023 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 77 Notes 1 to 29 are an integral part of these consolidated financial statements. * Per April 1, 2022, Gaypa Srl has sold its shares (12.1%) in PT Holco Indo Jaya to Holland Colours NV. This item reflects the changes in the non-controlling interest and controlling interest. In thousands of euros Note April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Capital Expenditures in Intangible Assets 12 – – Capital Expenditures in Financial Fixed Assets (420) – Disposal of Property, Plant and Equipment 13 3 26 Capital Expenditures in Property, Plant andEquipment 13 (3,879) (3,346) Cash Flow from Investment Activities (4,296) (3,320) Dividends Paid (5,128) (4,732) Lease Liabilities Payments (597) – Cash Flow from Financing Activities (5,725) (4,732) Exchange Rate and Translation Differences on Cash and Cash Equivalents 303 362 Net Cash Flow (1,202) 321 Cash and Cash Equivalents as at April 1 16,959 16,638 Cash and Cash Equivalents as at March 31 15,757 16,959 Net Cash Flow 18 (1,202) 321 In thousands of euros Note April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Operating Result 7,293 13,630 Adjustments for: • Amortisation of Intangible Assets and Impairments 12 64 87 • Depreciation of Property, Plant and Equipment and Impairments 13 2,574 2,314 • Depreciation of Right-of-Use Assets 14 616 1,008 • IFRS 16: reversal of lease costs – (921) • Changes in Provisions 25 (147) (17) • Exchange-rate Differences (41) 253 Cash Flow generated from Operating Activities before changes in Working Capital, Tax and Interest 10,359 16,354 Changes in Working Capital 2,153 (5,715) Income Tax Paid (3,918) (2,594) Interest Received 229 94 Interest Paid (307) (128) Cash Flow generated from Operating Activities 8,516 8,011 CONSOLIDATED CASH FLOW STATEMENT FOR THE FINANCIAL YEAR ENDED MARCH 31, 2023 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 78 Notes 1 to 29 are an integral part of these consolidated financial statements. 1. General Information Holland Colours NV (‘the company’) is a listed limited liability company (‘Naamloze Vennootschap’) under Dutch law with its registered office in Apeldoorn, the Netherlands. The company and its subsidiaries (‘the Group’), manufacture, distribute and sell color concentrates. As of the balance sheet date, the Holland Colours Group operates through eight of its own facilities and a network of agents and distributors. Shares of the company are listed on the Euronext stock exchange in Amsterdam. Since April 2, 2012, just over 50% of the shares in Holland Colours NV have been held by the Dutch-based investment company Holland Pigments BV. Holland Pigments BV is the ultimate parent company, in which, along with others, all employees of Holland Colours participate. The employees collectively hold approximately 25% of the shares in Holland Pigments BV. Participations held in Holland Pigments by former directors (who are also major shareholders in Holland Pigments) are excluded from this number. The Group’s financial year commences on April 1 and closes on March 31 of the following year. The consolidated IFRS financial statements of the company comprise the financial statements of the company and its subsidiaries. On June 1, 2023, the Board of Management authorized the financial statements for issue. The financial statements as presented in this report are subject to adoption by the Annual General Meeting of Shareholders on July 13, 2023. 2. Going Concern The Consolidated financial statements have been prepared on a going concern basis, resulting from management’s assessment of the ability of Holland Colours to continue its operations for the foreseeable future. IMPACT OF THE SITUATION IN UKRAINE AND COVID-19 AND ON THE FINANCIAL STATEMENT Our financial year began shortly after the start of the war in Ukraine. This, plus the changes in consumption patterns and demand as our markets (except China), opened up following COVID-19, impacted our business and fed into a general climate of rising interest rates, customer destocking and increased caution. But despite this, 2022/2023 can still be seen as positive for Holland Colours. Our people did a good job of mitigating the effect of increasing raw material prices in the face of the significant volume slowdown and we kept our costs under control. At the same time, we continued to deliver the strategic projects that will make us more agile, more resilient and more in tune with our customers and market developments going forward. In other words, we maintained our focus on the long term. Holland Colours has a strong balance sheet, a solid cash position and generates positive operational cash flows. We monitored our customers and working capital closely and saw no indications/reasons to take any precautionary actions. 3. Summary of Accounting Principles GENERAL The consolidated financial statements are prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and with Title 9 Book 2 of the Dutch Civil Code. The consolidated financial statements are presented in thousands of euros, rounded to the nearest thousand, unless stated otherwise. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS IN THOUSANDS OF EUROS, UNLESS STATED OTHERWISE FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 79 The consolidated financial statements are prepared on the basis of historical cost, with the exception of the Financial Non-Current Assets, which are measured at fair value. The accounting policies as detailed below are applied consistently for all periods presented in these consolidated financial statements. OPERATING SEGMENTS We determine and present operating segments based on the information that is used by the Board of Management. The segmentation is divisional, based on the regions in which the Group operates. In turn, these regions reflect the Group’s management and internal reporting structure. Segmentation based on markets in which the Group operates requires significantly more profit allocation. This is because several products are sold in more than one market, which makes the cost for accounting ineffective. IFRS CHANGES Below are the changes in the IFRS standards that have been issued and became effective as of January 1, 2022. These changes do not have a material impact on the Group. IFRS Topic Effective date IFRS 3, IAS 16, IAS 37, IFRS 1, IFRS 9, IAS 41 and IFRS 16 A number of narrow-scope amendments to IFRS 3, IAS 16, IAS 37 and some annual improvements on IFRS 1, IFRS 9, IAS 41 and IFRS 16. Annual periods beginning on or after January 1, 2022. New standards that become effective for Holland Colours after the 2022/2023 financial year are not included with early adoption. The IFRS standards shown in the table below will become effective for Holland Colours after March 31, 2023. The impact of these changes on the Group is expected to be limited. IFRS Topic Effective date IAS 1 Presentation of financial statements on classification of liabilities. Annual periods beginning on or after January 1, 2024 IAS 1, IAS 8 Narrow scope amendments to IAS 1, Practice statement 2 and IAS 8 Annual periods beginning on or after January 1, 2023 IAS 12 Amendment to deferred tax related to assets and liabilities arising from a single transaction. Annual periods beginning on or after January 1, 2023. IFRS 17 Insurance contracts. Annual periods beginning on or after January 1, 2023. USE OF ESTIMATES The preparation of the financial statements in compliance with IFRS requires management to make judgments, estimates and assumptions that affect amounts reported in the financial statements. The estimates and assumptions are based on experience and various other factors that are believed to be reasonable under the circumstances, and are used to judge the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions of estimates are included in the period in which they are revised. The most important estimates are stated under the relevant policies and relate to impairment analysis of Property, Plant and Equipment, the valuation of Inventories. CONSOLIDATION The consolidated financial statements include the accounts of Holland Colours NV and its subsidiaries. Subsidiaries are companies over which Holland Colours NV has control because it is exposed to, or has rights to, variable returns from its involvement with the subsidiary and has the ability to affect returns through its power over the subsidiary. Non-controlling interests in equity and in results are presented separately. NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 80 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS The consolidated financial statements include the financial data of the following companies: Legal structure including capital interest and division structure Division Subsidiaries Interest Consolidated EMEIA Holland Colours Europe BV, the Netherlands, Apeldoorn 100% 100% EMEIA Holland Colours UK Ltd, United Kingdom, Gillingham 100% 100% EMEIA Holland Colours Hungária Kft, Hungary, Szolnok 100% 100% Americas Holland Colours Canada Inc., Canada, Toronto 100% 100% Americas Holland Colours Americas Inc., United States, Richmond Indiana 100% 100% Americas Holland Colours Mexicana SA de CV, Mexico, Tultitlán 100% 100% Asia PT Holland Colours Asia, Indonesia, Surabaya 99% 100% * PT Holland Colours Asia fully merged with PT Holco Indo Jaya, in Indonesia as of November 1, 2022. Holland Pigments BV holds 1% of the legal ownership of PT Holland Colours Asia. Economic ownership resides with Holland Colours NV. There were some changes to the consolidated Group compared with the 2022/2023 financial year. Per April 1, 2022, Gaypa Srl has sold its shares (12.1%) in PT Holco Indo Jaya to Holland Colours NV. The purchase price (consideration) of € 420 was based on the net equity value of PT Holco Indo Jaya per April 1, 2022. The company adjusted the carrying amounts of the controlling and non-controlling interests to reflect the changes in the company’s relative interests in the subsidiary. There was no difference between the amount by which the non-controlling interest was adjusted and the fair value of the consideration paid, hence no direct impact is recognized in the equity. Due to synergy benefits, PT Holland Colours Asia and PT Holco Indo Jaya were merged per November 1, 2022, with PT Holland Colours Asia being the surviving company. Both companies were under common control. PT Holland Colours Asia, as the combined recipient company, issued new shares to shareholders of PT Holco Indo Jaya using the pooling of interest method. All assets and liabilities were therefore transferred at book value. In the consolidated financial statements, all intercompany receivables, payables and deliveries are fully eliminated, as are the related and not yet realized results. Unrealized losses are eliminated in the same way as unrealized profits, unless there is an indication of impairment. FOREIGN CURRENCY Transactions included in the financial statements of each of the Group's subsidiaries are measured using the currency of the primary economic environment in which the subsidiary operates. Transactions in foreign currency are translated to the functional currency using the foreign exchange rate at the transaction date. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency using the exchange rate at the balance sheet date. Foreign exchange differences resulting from translation into the functional currency are recognized in the Income Statement. Assets and liabilities of Group companies with a functional currency other than the euro are translated using the closing foreign exchange rate at the balance sheet date. The Income Statement for these Group companies is translated at the average exchange rate during the financial year. Foreign exchange rate differences are recognized in unrealized results and the foreign currency translation reserve. Furthermore, all resulting exchange rate differences are recognized in other comprehensive income. On sale or termination of an operation outside the Eurozone, the amount concerned is transferred from Equity to the Income Statement as part of the gain or loss on sale or termination. The principal exchange rates against the euro used in preparing the balance sheet and the statement of income are: Exchange Rates Used in EUR Balance Sheet Income Statement March 31, 2023 March 31, 2022 2022/ 2023 2021/ 2022 US dollar 1.09 1.11 1.04 1.16 British pound 0.88 0.85 0.86 0.85 Canadian dollar 1.47 1.39 1.38 1.46 Mexican peso 19.65 22.09 20.45 23.61 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 81 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS REVENUE RECOGNITION Revenues from contracts with customers are recognized by identifying the contract and its performance obligations as well as determination and allocation of the transaction price to these performance obligations. Revenues are recognized for each performance obligation when the control of goods or service has been transferred from Holland Colours to the customer at a point in time based on the contract. This is normally when the goods have arrived at the customer. The revenue is measured at the fair value of the transaction price received. This means the revenue is recognized net of rebates, discounts and similar allowances and net of sales tax. Grants Government grants related to costs are deducted from the relevant costs to be compensated in the same period. Government grants to compensate for the cost of an asset are deducted from the cost of the related asset. Finance Income and Expense Finance Income and Expense include the income and expenses on lent and borrowed funds and interest charges on lease payments. Finance Income and Expense is recognized in the Income Statement under Finance Income and Expense if no hedge accounting is applied. Income Tax Income Tax Expenses compromises both current and deferred tax, including the effects of changes in tax rates. The tax amount is calculated on the basis of the tax rates and tax legislation as applicable on the reporting date in the countries in which the Group operates and from which it generates income subject to taxation. Current income tax relating to items recognized directly in Equity is recognized in Equity and not in the Income Statement. Uncertain tax positions may exist due to interpretation differences of applicable tax regulations. Current tax receivables and liabilities for the current period are measured at the amount expected to be reclaimed from or paid to the tax authorities. Earnings per Share Earnings per ordinary share are calculated as the Net Result attributable to holders of ordinary shares, divided by the weighted average number of outstanding shares in the period concerned. PRINCIPLES FOR THE VALUATION OF ASSETS AND LIABILITIES General The valuation principles are primarily based on valuation of the assets and liabilities at historical cost. Offsetting Financial Instruments Financial Assets and Liabilities are offset in the consolidated balance sheet only in situations of an actual legally enforceable right to offset the amounts recognized, and only if it is the intention to settle these amounts on a net basis or simultaneously. Intangible Assets Costs of Development Activities are capitalized if the product or process is technically and commercially feasible, the Group has sufficient resources to complete its development, and it is expected that the product or process will generate future gains. The capitalized expenses comprise direct labor cost and a surcharge for overhead costs, to the extent that these are attributable to the project. All other research and development costs are stated as an expense in the Income Statement at the time they are incurred. Capitalized Development Costs are valued at cost, less accumulated amortization and impairments, if applicable. Amortization costs are charged to the Income Statement over their estimated useful life, which is typically five years. Intangible Assets are assessed for impairment if there are events or indications that an intangible asset might be subject to a loss in value. The amortization period and method for an intangible asset with a measurable useful life are assessed, at the very least, at the end of each financial year. Changes in the expected useful life of an asset, or in its expected pattern of future economic benefits, are accounted for by changing the amortization period or method and are treated as changes in accounting estimates. Other Intangible Assets Other Intangible Assets consists of the costs of computer software and licenses, plus the external costs related to their implementation and commissioning. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 82 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS Other Intangible Assets are measured at historical cost; that is, the acquisition price or production cost less cumulative amortization and any applicable impairments. Amortization Amortization of Intangible Assets is charged to the Income Statement according to the straight-line method. The basis applied is the estimated useful life of each component within an item that falls into the Development Costs and Other Intangible Assets category. The estimated useful life is as follows: Development Costs 5 years Other 3-5 years Property, Plant and Equipment Property, Plant and Equipment are stated at cost less accumulated depreciation, based on the estimated useful life of the assets concerned and impairment losses. The costs of assets produced in-house comprise material costs, direct labor cost and an appropriate portion of the directly attributable overhead costs. Finance costs are added to the costs of Property, Plant and Equipment if these meet the conditions for recognition in the balance sheet. If significant parts of Property, Plant and Equipment must be replaced at regular intervals, the Group recognizes these as separate assets with their own useful life and depreciation method. All other repair and maintenance costs are recognized in the Income Statement at the time they occur. Property, Plant and Equipment are assessed for impairment if there are events or indications that an item may have lost value. The depreciation period and method for Property, Plant and Equipment with a measurable useful life is assessed, at the very least, at the end of each financial year. Changes in the expected useful life of an asset, or in its expected pattern of future economic benefits, are accounted for by adjusting either the depreciation period or method. These are treated as changes in accounting estimate. Financial Non-Current Assets Loans and receivables for which the maturity date is more than 12 months after the balance sheet date are presented as Financial Non-Current Assets. On initial recognition, these are measured at fair value less directly attributable transaction costs. After initial recognition, interest-bearing loans are valued at amortized cost using the effective interest rate method, less any impairment. Gains or losses arising from changes in the amortized cost are accounted for in the Income Statement under Finance Expense. Right-of-Use Assets We assess at inception whether a contract is, or contains, a lease. A contract is or contains a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for a consideration. Leases are recognized as Right-of-Use Assets on the balance sheet under Non-Current Assets. The related lease liability is recognized as an obligation on the balance sheet under Non-Current Liabilities and Current Liabilities. The Group applies judgement in evaluating the term of lifetime of a lease. A judgement has to be made whether it is reasonably certain to exercise an option to renew or terminate a lease. The non-cancelable term of the lease is then determined based on these judgements. If the Group expects that the expiry date of the current contract will not in fact be the actual end date, the lease obligation is determined to include extension periods. The Group uses the practical expedients to apply a single incremental borrowing rate per portfolio of leases. Leases of low-value objects and non-lease components are excluded for buildings. Non-lease components do not apply to vehicle fuel costs, because fuel costs do not form part of the lease term. The Group uses the implicit interest rate when available. If not, the Group uses an Incremental Borrowing Rate (IBR) to measure the lease liabilities. The IBR is the rate of interest that the Group would have to pay to borrow the necessary funds, over a similar term and with a similar security, to obtain an asset of similar value to the Right-of-Use Asset in a similar economic environment. The IBR therefore reflects what the Group ‘would have to pay.‘ This necessitates estimating when no observable rates are available or when rates need to be adjusted to reflect the terms and conditions of the lease. The Group estimates the IBR based on observable inputs (such as market interest rates) and is required to make certain entity specific estimates. For this financial year the weighted average IBR is 4.56% (2021/2022: 4.1%). FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 83 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS Right-of-Use Assets are depreciated using the straight-line method over the lifetime of the object, in line with the duration of the contract. The net present value of the obligation is calculated using the applicable discount rate for object and country. The periodical payments to the lessor, based on the lease contract, can be considered as repayments of the obligation. The depreciations costs are charged as Depreciation and Amortization, the service costs as Other Operating Expenses and the interest expenses as Finance Expense to the Income Statement. Lease and rental agreements included in the standard for Lease and Rental Obligations are classified as Right-of-Use Assets. Property, Plant and Equipment acquired by means of leases or rentals are, at the moment of capitalization, measured using the then net present value of the lease payments. The depreciation period for Right-of-Use Assets reflects the duration of the underlying lease or rental contract. The depreciation method is straight-line. The depreciation period and method for Right-of-Use Assets is assessed, at the very least, at the end of each financial year. Changes in the expected useful life of an asset or in its expected pattern of future economic benefits are accounted for by adjusting either the depreciation period or method. These are treated as changes in accounting estimate. Low-value leases, below € 5,000 per underlying asset, are not recognized in the Right-of-Use Assets and Lease Liabilities. Lease payments on the lease of low-value assets are recognized as expensed on a straight-line basis over the lease term and recognized as general and administrative expenses in the statement of profit or loss. Low-value leases are not recognized in the balance sheet. Depreciation Depreciation is charged to the Income Statement according to the straight-line method on the basis of the estimated useful life of each component of items of Property, Plant and Equipment. Depreciation is not applied to land. The estimated useful life is as follows: Buildings 25-40 years Machinery and Equipment 10 years Other Non-Current Assets 3-5 years Right-of-Use Assets 1-10 years The remaining useful life, residual value and depreciation method are assessed on an annual basis. Impairment of Non-Current Assets An asset is impaired if its realizable value is less than its carrying amount. Non-current assets are assessed on an annual basis for indications of impairment per location. If there are such indications, or events, the realizable value of the asset concerned is estimated based on either its directly realizable value or its value in use to the company. The impairment test is primarily based on cashflow forecasts of five years. Elements considered to determine if a different approach would be more appropriate are, among others, high growth/emerging economies, geographical expansion opportunities and the introduction of new product lines. The cashflow forecast is calculated with the expected free cashflow and discounted to the present value using a weighted average cost of capital of 8% for the Group. Sensitivity tests are performed for growth assumptions, scenario-based adjustments to the free cashflow forecast and for the weighted average cost of capital. An impairment loss is reversed if there is a change to the estimates used. The reversal is done to the extent that the carrying amount of the asset does not exceed the carrying amount that would have been the case if no impairment had been recognized – so after deduction of the then applicable depreciation. In this financial year there were no indications or events that triggers impairment. Deferred Income Tax A receivable is recognized for deferred tax positions, or a provision is formed for this, using the balance sheet method for temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the carrying amount of these items for tax purposes. The carrying amount of Deferred Tax Assets is assessed at reporting date and reduced if and when it is unlikely that sufficient taxable profit will be available to absorb these temporary differences and/or changes incurred to the assessment base (such as a change in the corporate tax rate). Deferred Tax Assets not recorded are reassessed at reporting date and recorded when deemed realizable, based on expected future taxable profits. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 84 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS Inventories Inventories are measured at the lower of cost and net realizable value. The cost price for inventories is based on the FIFO principle (first in, first out). Finished Goods is valued at production cost including costs of raw materials and a surcharge to direct and indirect production costs. This valuation is based on normal capacity, or at realizable value if lower. The net realizable value compromises the estimated selling price in the normal course of the business, less the estimated cost for completion and estimated costs necessary to make the sale. The estimated selling price is based on actual selling prices and the recent sales history information per product. Aging of products is tracked and based on, and in line with, the aging management estimates of the risk of obsolescence, and this is used to adjust the valuation of the inventory accordingly. Trade and Other Receivables Trade and Other Receivables are recognized initially at fair value and subsequently at amortized cost. A provision for non-collectability is established based on expected credit loss. The Group measures the expected credit losses allowance for its trade receivables for the whole lifetime of the receivables (simplified approach). To measure the expected credit losses, trade receivables have been grouped based on shared credit risk characteristics. If these differences are substantial, they are grouped based on days past due and security, when applicable. The expected loss rates are based on the historical payment profiles of sales of the last five years and the corresponding historical credit losses experienced within this period. The historical loss rates are adjusted to reflect current and forward-looking information when these would affect the ability of customers to settle the receivables. Management assesses forward-looking information in relation to the specific market in which it operates. Bad debts are written off entirely once the inability to collect has been established with certainty. Indicators that there is no reasonable expectation of recovery include, amongst others, the failure to make the contractual payments for a period longer than the local applicable payment term, or a trade debtor has financial difficulties, or a trade debtor is unable to engage in a repayment plan with the Group. Cash and Cash Equivalents Cash and Cash Equivalents comprises cash balances and short-term deposits that are available on call. Cash and Cash Equivalents are financial instruments that are classified as measured at amortized cost. Dividends Dividends payable to shareholders are recognized as a liability to shareholders once the proposed profit appropriation has been approved by the Annual General Meeting of Shareholders. Deferred Tax Assets and Liabilities are valued at the tax rates and under the tax law that has been substantially enacted at the balance sheet date and which are expected to apply in the period in which the asset is realized, or the liability is settled. Under certain circumstances, current and deferred tax is recognized outside profit or loss either in Other Comprehensive Income or, directly, in Equity, depending on the item the tax relates to. Deferred Tax Assets and Liabilities are offset if, and only if, there is a legally recognized right to set off current tax assets and liabilities, and the Deferred Tax Assets and Liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity, or different taxable entities which intend to settle current tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered. There is a degree of uncertainty around the correct interpretation of complex tax regulations and the amount and timing of future taxable profits. Given the huge diversity of international business relations, discrepancies between the assumptions made and the actual outcomes, or future changes in such assumptions, these could lead to future changes in the tax payments and returns already recognized. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 85 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS Employee Benefit Obligations Holland Colours Group has a number of pension plans in accordance with local conditions and practices. The voluntarily pension plans of the subsidiaries are in line with local legislation and regulation and are included in the financial statements as defined contribution plans. These involve the payment of predetermined premiums to an insurance company. The terms of these pension plans mean that Holland Colours Group has no legal or factual obligation to pay additional premiums if the insurance company has insufficient means to fund current or future pensions. Other Employee Benefits The termination of the pre-pension plan (including the transitional arrangement) for employees in the Netherlands has led to the originally agreed conditional financing of past service years being converted into an annual payment of the same amount. This is also conditional. The most important conditions for this payment are that an employee must still be in the company’s service at the time of the annual payment, and that the Group’s financial results are assessed by the Board of Management as being sufficient to cover this payment. The Group has included a provision for this future liability, which will end in September 2037. Any revaluation of this future liability is recognized in the profit and loss account. The Group has also included a provision for other long-term obligations regarding Employee Benefits. These include jubilee payments, which are earned by employees for their service in the current and previous reporting periods. The obligations are calculated partly on the basis of actuarial principles and based on a discount rate of (2.41%) (2021/2022 (0.6%)) in accordance with the IBoxx Index Government bonds. They are recognized under Non-Current Liabilities. The expenses are reported in the Income Statement under Personnel Expenses. All assumptions are reassessed at balance sheet date. Share based payment Holland Colours Group operates a profit-sharing plan for its employees. Any payment under the plan depends on the ROI and operating result of the division for the financial year, and settlement takes place after the financial statements have been adopted by the Annual General Meeting of Shareholders of Holland Colours. Depending on the position of the individual employee, 25% to 75% of this payment is made in shares of the ultimate parent company Holland Pigments BV. The applicable shares are purchased for the employee at the last calculated price of Holland Pigments BV shares. There are no vesting conditions related to these shares. The remainder of the profit-sharing payment is paid in cash to the employees by Holland Colours NV. Since Holland Colours Group has the obligation to settle the profit-sharing payment, the portion settled in Holland Pigments BV shares is accounted for as a cash-settled share-based payment, while the portion settled in cash is accounted for as a short-term employee benefit. The estimated profit-sharing payment for the financial year is recognized as an expense and reported in the Income Statement under Personnel Expenses. The liability for the profit-sharing plan is recognized under Other Liabilities and Accruals. Provisions A provision is recognized in the balance sheet when there is a present obligation (legal or constructive) for the Group as a result of a past event and it is probable that an outflow of economic benefits will be required to settle this obligation and a reliable estimate can be made of the amount of the obligation. Provisions for restructuring of activities are recognized when a detailed and formal restructuring plan has been approved, and the restructuring has either commenced or has been announced publicly. We do not provide for future operating costs. Lease Liabilities The obligation arising from lease and rental agreements is classified as Lease Liabilities on the balance sheet. Lease Liabilities that run longer than 12 months are recognized under Non-Current Liabilities. Lease Liabilities shorter than 12 months are recognized under Current Liabilities. The estimated value of the liability is the calculated net present value of the remaining periodical payments as included in the contract. Applicable discount rates have been determined for each object and country of the lease portfolio for the calculation of the net present value. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 86 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS Trade and Other Payables Trade and Other Payables are recognized initially at fair value and subsequently measured at amortized cost. Determination of Fair Value Certain accounting policies as well as disclosures by the Group require fair value assessments of financial and non-financial assets and liabilities. Further information on the principles used in these assessments is provided in the notes relating to the specific asset or liability. Long-Term Receivables Long-term Receivables at fixed and variable interest rates are assessed by the Group on the basis of factors such as the applicable interest rate and the borrower’s individual creditworthiness. When necessary, a provision is formed for losses expected on these receivables on the basis of this assessment. As at March 31, 2023, the carrying amount of these receivables did not vary materially from their fair value. Trade and Other Receivables The fair value of Trade Debtors and Other Receivables is estimated as the net present value of future cash flows, based on market interest rates as at the reporting date. This fair value is determined for informative purposes. in commercial transactions in non-functional currencies (mainly USD). Holland Colours aims to limit the effect of transaction-related exchange-rate exposure on the Group by preferring to invoice in the functional currency of the supplying entity, which in most cases is regional. Currency hedging on outstanding AR or projected sales is not in place. The Group participates in several foreign subsidiaries of which the net equity is mainly USD nominated. This is subject to currency translation risk in the consolidation process. The impact varies over the years and is complicated to mitigate due to the long-term fluctuations in the EUR-USD rate. This risk is monitored but not hedged. The table below shows the sensitivity of the net result after tax and the equity (including translation effects) to the US dollar with all other variables kept constant: 4. Financial Risk Management As part of the normal conduct of its business, the Group is exposed to a variety of financial risks, such as currency risk, credit risk, liquidity risk, interest risk and capital risk. In terms of risk management policy, it is recognized that the financial markets are volatile and that the aim should be to limit the potential negative effects of this on the Group’s financial results as much as possible. The Board of Management is responsible for managing the risks associated with our activities and the establishment and adequate functioning of appropriate risk management and control systems. CURRENCY RISK The reporting currency of the Group is the euro. Being a global operation, the Group is exposed to a variety of foreign currencies. Currency risk arises from engaging 2022/2023 2021/2022 Increase EUR-USD 10% Decrease EUR-USD 10% Increase EUR-USD 10% Decrease EUR-USD 10% Net Result (454) 608 (544) 634 Equity (3,003) 3,671 (2,847) 3,627 In relative terms, the various currencies affected the Group’s net sales and expenses as follows: Revenue Expenses 2022/2023 2021/2022 2022/2023 2021/2022 Euro 44% 47% 41% 41% US dollar 39% 37% 35% 32% Other 17% 16% 24% 27% Total 100% 100% 100% 100% FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 87 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS CREDIT RISK Credit risk is the risk of financial loss by the Group in the event a customer fails to meet their contractual obligations. Credit risk mainly arises from receivables from customers. Holland Colours follows an active policy to minimize credit risk. This policy includes strict internal guidelines regarding overdue payments, the use of sales information systems, the consultation of external sources and, where necessary, requesting security for payment. Due to its distribution over a large number of customers and geographical areas, there is no significant concentration of credit risk. There is no insurance for credit risk in place. The cash transactions are executed with creditworthy financial institutions. LIQUIDITY RISK Liquidity risk is the risk that Holland Colours is unable to meet its obligations when they are due. Holland Colours’ policy with regard to liquidity risk is to ensure to the best of its ability that sufficient committed credit facilities are available to meet its payment obligations on time, in both normal and exceptional situations. The Trade and Other liabilities all fall due within one year. The Group aims to maintain flexibility in funding by keeping credit lines available at a number of well-known financial institutions. On the basis of cashflow forecasting models, the Group tests whether the available credit facilities will cover the expected credit need. Based on the analysis, the Group believes that the current expected credit need is covered sufficiently. INTEREST RATE RISK At the end of the fiscal year, there were no current or non-current borrowings. As the Group has no significant interest-bearing assets and liabilities, the direct impact of changes in the market rates to the Group’s income and operating cash flow is limited. CAPITAL RISK The policy of the Group regarding the capital structure of the company is based on the solvency ratio. The solvency ratio remains above 60% and is calculated by equity/total assets. In addition, the Group aims to finance its activities with equity. FAIR VALUE OF FINANCIAL INSTRUMENTS The Group applies the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique: • Level 1: Quoted (unadjusted) prices in active markets for identical assets or liabilities; • Level 2: Valuation techniques whereby the lowest-level input as significant for valuation at fair value is directly or indirectly observable; • Level 3: Valuation techniques whereby the lowest level input as significant for valuation at fair value is not observable. Changes in the fair value of the above-mentioned Financial Instruments, if accounted for at fair value, are recognized in the Income Statement unless hedge accounting is applied. The fair value of Financial Instruments is calculated on the basis of the net present value of the expected future cash flows by virtue of repayment and interest payments. The calculation is not based on observable market data. Trade and Other Receivables, Payables to Suppliers, Credit Institutions and Other Debt due to expire within one year are included in the financial statements at amortized cost. The amortized cost is considered to be a reflection of fair value due to the short duration. 5. Cash Flow Statement The cash flow statement is prepared using the indirect method. Cash flows in foreign currencies are translated at transaction date. 6. Segment Information The Group is divided into geographical segments for management as well as business purposes. The segment information contained in the financial statements is therefore presented based on the organizational structure of the Group. In this, the three operating units each represent a region and the holding, under ‘Other‘ represents General Management, Innovation and Technology and other central functions. The Board of Management monitors the operating result of the geographic segments to facilitate the decision- making process in relation to the allocation of resources and the performance evaluation. The operating result of FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 88 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS the segments is determined and based on the same accounting principles as the operating result shown in the consolidated financial statements. The funding of the Group, including loan structure and dividend policy as well as the current income tax, deferred income tax and certain financial assets and liabilities, is also not allocated to the segments as these items are supervised at Group level. Transfer prices for transactions and services between the operating segments are set on an arm’s-length basis. Revenue in the Netherlands accounted for 49% (2021/2022: 53%) and the USA accounted for 26% (2021/2022: 24%) of total revenue. There are no other significant revenue concentrations in specific countries. The Group companies in the identified segments are to some extent dependent on certain large customers. Segments 2022/2023 EMEIA Americas Asia Other Adjustments/ Elimi nations Total Revenue 54,544 42,437 14,457 – – 111,438 Intersegmental Transactions 1,281 52 – – (1,333) – Revenue including Intersegmental Transactions 55,825 42,489 14,457 – (1,333) 111,438 Depreciation, Amortization and Impairments (1,656) (960) (445) (258) 66 (3,253) Operating Result 862 3,389 1,797 1,245 – 7,293 Financial Income – – – – 229 229 Financial Expense – – – – (308) (308) Tax – – – – (1,345) (1,345) Net Result – – – – 5,869 5,869 Non-Current Assets 13,409 6,028 2,717 62,215 (60,016) 24,353 Current Assets 22,182 16,694 10,591 839 (904) 49,402 Liabilities 14,755 1,290 1,795 4,244 (7,142) 14,942 Total Investments 3,264 377 210 28 – 3,879 Average Number of Employees (in FTE) 203 101 139 21 – 464 Segments 2021/2022 EMEIA Americas Asia Other Adjustments/ Elimi nations Total Revenue 58,489 37,622 14,354 – – 110,465 Intersegmental Transactions 1,195 38 – – (1,233) – Revenue including Intersegmental Transactions 59,684 37,660 14,354 – (1,233) 110,465 Depreciation, Amortization and Impairments (1,256) (722) (382) (254) (798) (3,412) Operating Result 5,813 3,901 1,923 1,992 – 13,629 Financial Income – – – – 94 94 Financial Expense – – – – (86) (86) Tax – – – – (3,301) (3,301) Net Result – – – – 10,243 10,243 Non-Current Assets 10,853 6,318 4,251 59,572 (57,447) 23,547 Current Assets 26,543 18,461 10,032 2,178 (1,145) 56,069 Liabilities 17,005 3,996 3,087 4,016 (6,239) 21,866 Total Investments 2,141 809 324 74 (3) 3,345 Average Number of Employees (in FTE) 205 95 129 19 – 448 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 89 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS 7. Revenue The table below shows the breakdown of Revenue per market segment. April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Building & Construction 51,695 52,310 Packaging 35,061 32,930 Coatings, Sealants & Adhesives 13,604 15,021 Other 11,078 10,204 Total Revenue 111,438 110,465 8. Personnel Expenses The table below shows the breakdown for Personnel Expenses. April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Wages and Salaries (20,264) (19,157) Social Security (2,035) (1,949) Pension Costs (1,075) (1,264) Personnel Expenses (23,374) (22,370) For this financial year, an accrual for profit sharing of € 1,260 is included (2021/2022: € 2,255). This is included under Wages and Salaries. All employees in the Group are eligible for the profit-sharing plan. Payments depend on the Group’s ROI and the operating result of the division in which the individual employee works. The remuneration of the Board of Management and the Supervisory Board is shown in Note 28: Related Parties. The pension costs relate to defined contribution plans. Wages and salaries in this financial year include € 55 of government grants (2021/2022: € 90). In this financial year, the average number of employees was 464 FTEs (2021/2022: 448 FTEs). 9. Other Operating Expenses The table below shows the main components of the Other Operating Expenses. April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Other Personnel (2,760) (2,496) Travel and Accommodation (821) (939) Maintenance (1,667) (1,471) Energy (1,957) (1,446) Consulting (2,801) (2,414) Materials (1,714) (1,488) Insurance (732) (616) Other Costs (2,128) (1,356) Other Operating Expenses (14,580) (12,226) FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 90 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS 10. Finance Income and Expense April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Finance Income 229 94 Finance Expense (308) (180) Finance Income and Expense (79) (86) 11. Income Tax The main components of the Tax charge in this financial year are shown in the table below. April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Consolidated Income Statement Corporate Income Tax due this year: • Current Income Tax (1,725) (3,329) • Tax Incentive Programs, including Innovation Box 114 140 • Adjustments of tax recorded in previous years 334 – • Other Taxes, including Applied Withholding Tax (67) (124) Deferred Tax: • In relation to the existence and reversal of temporary differences (1) 12 Income Tax recognized in the Consolidated Income Statement (1,345) (3,301) The Corporate Income Tax as recognized in the consolidated income statement amounted to € 1,345 versus € 3,301 the previous year. The effective tax rate is 18.5% which is mainly explained by previous years adjustments. The Other Taxes mainly relates to local applied Withholding Taxes on dividends and royalties paid to the company by the operating entities in Indonesia, Canada and Mexico. These accumulated charges are gradually applied against the Dutch corporate income tax. Calculation of effective tax rate starting at statutory tax rate in the Netherlands: April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Result before Income Tax 7,239 13,732 At the rate applicable in the Netherlands (25.8%) (1,868) (25.0%) (3,433) Effect of different tax rates in countries in which the Group operates 2.0% 143 0.8% 104 Adjustments of tax recorded in previous years 4.6% 334 (0.4%) (51) Expenses not tax-deductable (1.5%) (110) (0.4%) (61) Tax incentive programs 1.6% 114 1.0% 140 Other differences 0.6% 42 0.0% – (18.5%) (1,345) (24.0%) (3,301) FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 91 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS 12. Intangible Assets Development Costs Other Assets under Construction Total As at March 31, 2021 Cost 1,922 532 – 2,454 Accumulated Amortization (1,803) (495) – (2,298) Carrying Amount 119 37 – 156 Change in Asset Value Capital Expenditures – – – – Transfer – – – – Amortization (71) (16) – (87) Exchange Rate Differences – – – – Balance (71) (16) – (87) As at March 31, 2022 Cost 1,922 532 – 2,454 Accumulated Amortization (1,874) (511) – (2,385) Carrying Amount 48 21 – 69 Change in Asset Value Capital Expenditures – – – – Transfer – – – – Amortization (48) (16) – (64) Exchange Rate Differences – – – – Balance (48) (16) – (64) As at March 31, 2023 Cost 1,922 532 – 2,454 Accumulated Amortization (1,922) (527) – (2,449) Carrying Amount – 5 – 5 The company’s total expenses for research and development were €1,770 in the financial year (2021/2022: € 2,007). The expenses are included under Personnel Expenses, Depreciation, Amortization and Other Operating Expenses. Due to the development structure of the research and technology department, the Group does not comply with all the criteria for capitalizing development costs in line with IAS 38,57. The amortization amounting to € 64 (2021/2022: € 87) is recognized under Amortization and Impairments in the consolidated Income Statement. There were no impairments in this financial year in relation to the capitalized development costs (2021/2022: nil). The Other Intangible Assets consist of the purchase price of computer software and licenses, as well as the external costs related to their implementation and commissioning. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 92 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS 13. Property, Plant and Equipment Land and Buildings Machinery and Equipment Other Assets under Construction Total As at March 31, 2021 Cost 25,353 29,116 4,701 389 59,559 Accumulated Depreciation (15,060) (21,112) (4,033) – (40,205) Carrying Amount 10,293 8,004 668 389 19,354 Change in Asset Value Capital Expenditures 303 1,326 154 1,563 3,346 Transfer Assets under Construction 138 1,109 74 (1,321) – Disposal – (8) (19) – (26) Depreciation (676) (1,410) (228) – (2,314) Exchange Rate Differences 222 177 19 39 456 Balance (13) 1,194 – 281 1,463 As at March 31, 2022 Cost 26,016 31,720 4,930 670 63,335 Accumulated Depreciation (15,736) (22,522) (4,261) – (42,519) Carrying Amount 10,280 9,198 668 670 20,817 Change in Asset Value Capital Expenditures 184 149 73 3,473 3,879 Transfer Assets under Construction 282 1,215 278 (1,775) – Disposal (1) (1) (1) – (3) Depreciation (688) (1,623) (262) – (2,573) Exchange Rate Differences 101 104 10 (8) 207 Balance (122) (156) 98 1,690 1,510 As at March 31, 2023 Cost 26,481 33,083 5,280 2,368 67,212 Accumulated Depreciation (16,323) (24,041) (4,513) (8) (44,885) Carrying Amount 10,158 9,042 767 2,360 22,327 The capital expenditures include nil (2021/2022: nil) of capitalized Personnel Expenses. No impairments were incurred in this financial year (2021/2022: nil), while the asset count led to Disposals. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 93 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS 14. Right-of-Use Assets The table below shows the movement of Right-of-Use Assets. These Assets consist of capitalized lease and rental contracts. Land and Buildings Machinery and Equipment Vehicles Total As at April 1, 2021 560 109 947 1,616 Change in Asset Value New Contracts 150 48 441 639 Depreciation (336) (59) (405) (800) Other Adjustments – – (208) (208) Balance (186) (11) (172) (369) As at March 31, 2022 Carrying Amount 374 98 775 1,247 Change in Asset Value New contracts – 98 233 331 Remeasurements – – 3 3 Depreciation (190) (66) (360) (616) Transfer (17) 44 (27) – Exchange-rate Differences 7 1 1 9 (200) 77 (150) (273) As at March 31, 2023 Carrying Amount 174 175 625 974 The Group’s lease liabilities and maturity analysis are disclosed in note 24. 15. Deferred Income Tax Assets and Liabilities Deferred Income Tax resulting from temporary differences between the fiscal and commercial value of assets and liabilities is accounted for in the nominal tax rate applicable in the country concerned, but only if it is likely to be realized from future taxable profits. This likelihood assessment is based on projections of the future taxable results of the relevant entities in the Group. These projections are partly based on approved budgets. The Deferred Tax Assets and Liabilities stated in the balance sheet can be attributed to the following items: April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Assets Liabilities Assets Liabilities Property, Plant and Equipment 314 275 301 250 Financial Non-Current Assets 185 – 203 – Inventories 207 – 173 – Other Receivables 222 – 238 – Employee Benefits 298 – 351 – Other Assets/Liabilities 15 25 149 23 Tax Loss Carry-Forward – – – – Balance of Assets and Liabilities 1,241 300 1,415 273 Offset within same tax jurisdiction (194) (194) – – Balance of Assets and Liabilities 1,047 106 1,415 273 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 94 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Current 29 30 Non-Current 912 1,112 Deferred Tax Assets and Liabilities 941 1,142 Change in Net Deferred Tax April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Opening Balance 1,142 1,130 Recognized in Income Statement (1) 12 Transferred to current tax liabilities (200) – Deferred Tax Assets and Liabilities 941 1,142 The deferred tax asset position decreased by € 201 (2021/2022: € 12) of which € 200 due to transfer to current tax liabilities. 16. Inventory April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Raw Materials 8,764 13,639 Finished Goods 6,801 6,959 Inventory 15,565 20,598 The Income Statement includes an amount of € 62,952 (2021/2022: € 58,829) under the direct selling cost and raw materials for usage of inventory goods. At March 31, 2023, the provision for obsolete inventory amounted to € 1,221 (March 31, 2022: € 1,016). Movements in the provision for obsolete inventory are shown below. April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Opening Balance (1,016) (1,010) Additions to the Provision (224) (89) Withdrawals/Releases 34 114 Exchange Rate Differences (14) (31) Closing Balance (1,220) (1,016) Impairments charged to the provision relates to sales from inventory where provided for, or to disposal of obsolete inventory. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 95 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS 17. Trade and Other Receivables April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Trade Debtors 14,789 15,934 Tax-Related Receivables 1,019 830 Prepaid Items 780 1,381 Trade and Other Receivables 16,588 18,145 The Tax-Related Receivables relates to a VAT claim in Indonesia. The Group expects to receive the claim in full in the next financial year. The aging specification of Trade Debtors is shown in the table below. March 31, 2023 March 31, 2022 Not yet due 13,366 14,665 Overdue 0-30 days 1,227 994 Overdue 31-60 days 102 238 Overdue 61-365 days 50 (16) Overdue 366 days or more 44 53 Total 14,789 15,934 Trade Debtors by Currency March 31, 2023 March 31, 2022 Euro 8,743 8,371 US dollar 4,950 6,124 British pound 564 530 Other Currencies 532 909 Total 14,789 15,934 Trade and Other Receivables with less than one year to maturity are recognized initially at fair value and subsequently at amortized cost. Additions to the Provision for Doubtful Debts are included in the Income Statement under Other Operating Expenses. The table below shows movements in the Provision for Doubtful Debts. April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Opening Balance (156) (161) Additions to the Provision (12) 27 Releases from the Provision 22 – Write-off of Trade Debtors 2 (26) Exchange Rate Differences (2) 4 Closing Balance (146) (156) The table below shows the percentages used for expected credit losses on trade receivables. March 31, 2023 March 31, 2022 Not overdue 0.24% 0.25% 1 – 30 days overdue 1.00% 1.00% 31 – 60 days overdue 2.50% 2.50% 91 – 365 days overdue 5.00% 5.00% > 365 days overdue 100.00% 100.00% FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 96 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS 18. Cash and Cash Equivalents March 31, 2023 March 31, 2022 Bank Balances 15,750 16,955 Cash Balances 7 4 Total 15,757 16,959 The Cash and Cash Equivalents are freely available to the company. The credit risk on Cash and Cash Equivalents is limited as the counterparties are generally banks with high credit ratings from international credit-rating agencies. 19. Share Capital ISSUED SHARE CAPITAL The registered capital of Holland Colours NV is € 6,810 divided into 3,000,000 ordinary shares with a face value of € 2.27 per share. Of this registered total, an amount of 860,351 shares are issued and fully paid up. The total issued share capital is € 1,953. There were no changes to the issued capital in either the 2022/2023 or the 2021/2022 financial year. SHARE PREMIUM RESERVE The Share Premium Reserve of € 1,219 is available for distribution to shareholders and is unchanged relative to the last financial year. 20. Other Reserves LEGAL RESERVE FOR FOREIGN CURRENCY TRANSLATION The Foreign Currency Translation Reserve relates to all exchange-rate differences that originate from the translation of the financial statements of the subsidiaries with a functional currency other than the euro. This only applies to the non-monetary accounts. These translation results are directly allocated to Equity via Other Comprehensive Income. This practice was initiated on April 1, 2004, in accordance with the exception allowed in IFRS 1. LEGAL RESERVE FOR INTANGIBLE ASSETS A statutory reserve for development costs is formed in the company financial statements, although not specifically required under IFRS. This statutory reserve is formed within Equity to maintain alignment with Equity in the company financial statements. The above- mentioned reserves may not be distributed freely to shareholders. Negative amounts reduce the amount available for distribution and positive amounts are non-distributable. 21. Earnings per Share Earnings per share allocated to shareholders (ordinary and diluted) in this financial year amounted to € 6.82 (2021/2022: € 11.83). The calculation of the earnings per share at March 31, 2023 is based on the net result attributable to shareholders of € 5,869 (2021/2022: € 10,179) and the average number of shares issued in this financial year of 860,351. The total number of issued shares did not change compared to March 31, 2022. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 97 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS 22. Non-Controlling Interest Per April 1, 2022, Gaypa Srl has sold its shares (12.1%) in PT Holco Indo Jaya to Holland Colours NV. The purchase price (consideration) of € 420 was based on the net equity value of PT Holco Indo Jaya per April 1, 2022. March 31, 2023 March 31, 2022 Opening Balance 420 341 Net result for the financial year – 64 Other comprehesive income – 15 Purchase of minority share PT HIJ (420) – Closing Balance – 420 23. Credit Facility The company does not have any long-term debt positions outstanding (March 31, 2022: also nil). Short-term funding needs are covered with access to current account credit facilities of € 7,000 per balance sheet date (March 31, 2022: € 7,899 ). These facilities are provided by various international and local banks and have no expiration date. The amount drawn was nil at the March 31 balance sheet date for both 2023 and 2022. 24. Lease Liabilities The Group recognized Lease Liabilities on the balance sheet. The table below shows the movement and breakdown of Non-Current and Current Lease Liabilities. April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Opening Balance 1,279 1,599 Lease payments (597) (679) New contracts 332 585 Remeasurements 2 – Other adjustments (143) (226) Exchange Rate Differences 7 – Closing Balance 880 1,279 April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Non-Current Lease Liabilities 441 677 Current Lease Liabilities 439 601 Total 880 1,279 Maturity analysis – contractual undiscounted cashflows: March 31, 2023 March 31, 2022 Less than 1 year 466 640 Between 1 and 5 years 504 679 Longer than 5 years – 2 Total 970 1,321 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 98 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS 25. Employee Benefit Obligations PRE-PENSION PLAN IN THE NETHERLANDS The pre-pension plan in the Netherlands relates to the obligation to issue a conditional annual payment. As explained in Note 3, the originally agreed conditional financing of past service years in the pre-pension plan has been converted into an equivalent annual payment. This is also conditional. At March 31, 2023, the resulting liability amounted to € 174. On March 31, 2022, the liability was € 236. LEGAL LIABILITY ON TERMINATION OF EMPLOYMENT – INDONESIA This mainly relates to the legal liability to make a payout should the employment of Indonesian personnel be terminated. As of the reporting date, the primary actuarial assumptions were: March 31, 2023 March 31, 2022 Discount Rate 7.0% 6.8% Expected Return Fund Capital Expenditures 7.0% 6.8% Future Salary Increases 6.0% 6.0% Weighted average duration 10.10 7.20 Assumptions relating to future mortality rates are based on published statistical data and mortality tables. The mortality table used is the TMI 2011 (2021/2022: TMI 2011) table with a correction factor varying for age and gender. The total expected long-term Return on Investment amounts to 7.0% (March 31, 2022: 6.8%). OTHER EMPLOYEE BENEFITS The Other Employee Benefits item also includes a provision for future jubilee payments of € 375 (March 31, 2022: € 332) and other future payments of € 64 (March 31, 2022: € 57). Movements in the Employee Benefit Obligations are shown in the table below. Pre- pension Plan the Netherlands Statutory Termination Employment Plan Indonesia Other Employee Benefits Total As at March 31, 2021 299 583 295 1,177 Additions – 200 134 324 Withdrawals/Releases (63) (223) (39) (325) Exchange Rate Differences – 9 – 9 As at March 31, 2022 236 569 389 1,194 Additions – – 83 83 Withdrawals/Releases (62) (150) (36) (248) Exchange Rate Differences – 14 3 17 As at March 31, 2023 174 433 439 1,046 Of this total, the following amounts have been accounted for under current liabilities: Pre- pension Plan the Netherlands Statutory Termination Employment Plan Indonesia Other Employee Benefits Total As at March 31, 2023 32 130 30 192 As at March 31, 2022 39 – 49 88 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 99 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS 26. Trade and Other Liabilities March 31, 2023 March 31, 2022 Trade Creditors 7,751 10,458 Payables Regarding Other Taxes 629 371 Other Liabilities and Accruals 4,406 6,563 Trade and Other Liabilities 12,786 17,392 The Payables regarding Other Taxes relates mainly to property tax and social security taxes. The Other Liabilities and Accruals also includes a profit share to be paid to employees of € 1,260 (March 31, 2022: € 2,225). For details regarding the profit sharing plan reference is made to note 28 and 29. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 100 27. Contingent Assets and Liabilities CAPITAL COMMITMENTS The Group had entered into capital commitments regarding Property, Plant and Equipment as at balance sheet date of € 5,556 (March 31, 2022: € 2,089). PURCHASE CONTRACTS The total commitment resulting from raw material purchase contracts was € 8,535 (March 31, 2022: € 4,820). 28. Related Parties IDENTITY OF RELATED PARTIES The related parties can be divided into the relations between the Group and its subsidiary companies, the members of the Board of Management, Supervisory Board and the holding company Holland Pigments BV. REMUNERATION OF KEY OFFICERS OF THE GROUP The key officers are the members of the Board of Management. REMUNERATION POLICY The remuneration policy for the Board of Management, which consists of the Chief Executive Officer, Chief Financial Officer and Chief Technology Officer, is set by the Supervisory Board. A separate Remuneration Committee is in place. Holland Colours strives to pay remuneration in line with the market for a company of its size, and in proportion to its overall salary structure. The remuneration package consists of a fixed element and a variable element. Fixed salaries are adjusted annually in line with inflation. The variable payment for the Board of Management consists of a bonus plan based on achieving financial and non-financial targets. The bonus is up to three times the monthly salary in the event that 100% of the targets are achieved. The Board of Management also participates in the profit-sharing plan, under which Holland Colours pays up to 1.5 months’ salary. For the Board of Management, the profit-sharing plan depends on the ROI realized by Holland Colours whereby 75% of this part of the bonus is paid in shares of Holland Pigments. Based on the results for the 2022/2023 financial year, the Board of Management will receive such a payment. For 2022/2023, the Board of Management partly achieved the bonus targets. An accrual for payout has been made. The company does not offer an option plan. The Group does not provide any personal loans, guarantees or advance payments to the members of the Board of Management or the Supervisory Board. The contracts with the Chief Executive Officer, the Chief Financial Officer and the Chief Technology Officer specify a term of appointment of four years and a severance payment which is in accordance with the recommendations of the Dutch Corporate Governance Code. OTHER DISCLOSURES IN THOUSANDS OF EUROS, UNLESS STATED OTHERWISE FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 101 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS The breakdown of the remuneration for the Board of Management and Supervisory Board is listed in the table below. Board of Management Coen Vinke Tanja van Dinteren Eelco van Hamersveld Total 2022/2023 2021/2022 2022/2023 2021/2022 2022/2023 2021/2022 2022/2023 2021/2022 Fixed Salary 338 334 – 200 210 193 548 727 Pension Expenses 30 27 – 17 23 20 53 64 Variable Element 55 92 – 44 32 77 87 213 Non-Recurring Payment – – – 96 – – – 96 423 453 – 357 265 290 688 1,100 Transactions with Key Officers Other than the regular remuneration, no transactions with key officers took place during the financial year. Other Interests of Members of the Board of Management No transactions were effectuated during the financial year with parties in which any of the Supervisory Board Members, Members of the Board of Management or their partners have an interest. Supervisory Board 2022/2023 2021/2022 R. Zoomers 45 38 A.R. Doornbos 32 26 J. Klaus 32 26 G.H. de Heer 32 26 Total 141 116 The Annual General Meeting of Shareholders determines the remuneration of the Supervisory Board Members. The fixed remuneration is intended to be in line with the market given the size of the company. Holland Pigments BV At the balance sheet date, the Dutch based investment company Holland Pigments BV held 434,652 (March 31, 2022: 434,644) shares in Holland Colours NV. Within Holland Pigments BV, employees collectively held approximately 25% (2021/2022: 25%) of the shares of Holland Pigments BV. The costs incurred by Holland Pigments BV in connection to activities relating to the employee participation are partly reimbursed by Holland Colours NV. Please refer to page 66 for a further description of the activities of Holland Pigments BV. An amount of € 99 was accordingly paid to Holland Pigments BV in the 2022/2023 financial year (2021/2022: € 98). At the balance sheet date, there was no outstanding material position with Holland Pigments BV. Receivables from and payables to Holland Pigments BV are not covered by commercial collateral, are non-interest-bearing and are settled in cash. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 102 NOTES TO THECONSOLIDATED FINANCIAL STATEMENTS 29. Other Disclosures PROFIT-SHARING PLAN Holland Colours Group operates a profit-sharing plan for its employees. The plan is the same for all Group employees and may, depending on the ROI and operating result of the division, result in a payment of up to 1.5 months’ salary. Depending on the position of the individual employee, 25% to 75% of this payment is made in Holland Pigments BV shares, in recognition of the employee participation model. Settlement to employees takes place after the financial statements have been adopted by the Annual General Meeting of Shareholders of Holland Colours. The applicable shares in Holland Pigments BV are purchased for the employee at the last calculated price of Holland Pigments BV shares. The remainder of the profit-sharing payment is paid in cash to the employees by Holland Colours NV after the relevant statutory deductions have been made. A profit-sharing payment is applicable to the employees on the basis of the results in the 2022/2023 financial year. As disclosed in Note 8, an expense for profit sharing of € 1,260 is included under Wages and Salaries (2021/2022: € 2,255) which is fully accrued as at 31 March 2023 (Note 26). Since Holland Colours Group has the obligation to the profit- sharing payment, the portion settled in Holland Pigments BV shares is accounted for as a cash-settled share-based payment, while the portion settled in cash is accounted for as a short-term employee benefit. The accrual and the expense for the financial year consists of the cash-settled share-based payment of € 466 (2021/2022: € 834) to be settled in Holland Pigments BV shares and an amount of € 794 (2021/2022: € 1,421) to be settled in cash. The shares held by Holland Pigments BV in Holland Colours NV are specified below. 2022/2023 2021/2022 Number of Shares in Holland Colours NV held by Holland Pigments BV Situation at April 1 434,644 434,054 Purchased by Holland Pigments BV 8 590 Situation at March 31 434,652 434,644 In euros Share Price of Holland Colours NV at Balance Sheet Date 118 156.50 Value 51,288,936 68,021,786 EMPLOYEE NUMBERS During the 2022/2023 financial year, the company employed an average of 464 FTEs (2021/2022: 448 FTEs). Of these, 132 FTEs (2021/2022: 128 FTEs) were employed in the Netherlands. SUBSEQUENT EVENTS No events took place after the reporting period that could materially affect the financial statements. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 103 COMPANY INCOME STATEMENT FOR THE FINANCIAL YEAR ENDED MARCH 31, 2023 In thousands of euros Note April 1, 2022/March 31, 2023 April 1, 2021/March 31, 2022 Management Fees 9,532 9,639 Personnel Expenses 33 (4,005) (3,524) Amortization 35 (64) (86) Depreciation 36/37 (194) (182) Other Costs (4,066) (3,514) Operating Result 1,203 2,333 Interest Income 170 65 Interest Expenses (100) (40) Result before Tax 1,273 2,358 Income Tax 34 2 (553) Result Subsidiaries 38 4,594 8,373 Net Result 5,869 10,178 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 104 COMPANY In thousands of euros Note March 31, 2023 March 31, 2022 Non-Current Assets Intangible Assets 35 4 68 Property, Plant and Equipment 36 1,158 1,185 Right-of-Use Assets 37 170 223 Financial Non-Current Assets 38 60,884 57,692 62,216 59,168 Current Assets Receivables from Group Companies 141 448 Income Tax Assets 521 – Other Receivables and Prepayments 117 172 Cash and Cash Equivalents 60 1,617 839 2,237 Total Assets 63,055 61,405 In thousands of euros Note March 31, 2023 March 31, 2022 Equity Share Capital 39 1,953 1,953 Share Premium Reserve 39 1,219 1,219 Statutory Reserves 39 506 (18) Retained Earnings 39 49,266 43,998 Result for the Year 39 5,869 10,178 Total Equity 58,813 57,330 Non-Current Liabilities Lease Liabilities 41 90 134 Employee Benefit Obligations 42 20 24 110 158 Current Liabilities Payables to Group Companies 2,711 170 Lease Liabilities 41 83 118 Income Tax Liabilities – 1,539 Other Liabilities and Accrued Income 1,338 2,090 4,132 3,917 Total Equity and Liabilities 63,055 61,405 BALANCE SHEET AS OF MARCH 31, 2023 BEFORE PROPOSED PROFIT APPROPRIATION FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 105 30. General Information The company financial statements are part of the financial statements of Holland Colours NV and are prepared in accordance with the legal requirements of Title 9, Book 2 of the Dutch Civil Code. Holland Colours NV applies the same accounting policies to the company financial statements as those used in the consolidated financial statements. This is done under the possibility given in Article 2:362, paragraph 8 of the Dutch Civil Code to apply. The only exception relates to the accounting standards relating to participations in Group companies. Investments in consolidated subsidiaries are measured at net asset value. The 2022/2023 company financial statements were presented to the Supervisory Board to be approved for publication on June 1, 2023. The financial statements will be presented to the Annual General Meeting of Shareholders for adoption on July 13, 2023. 31. Summary of Accounting Principles The accounting policies used for the company financial statements are the same as those used for the consolidated financial statements. Unless other standards are stated, the reader is referred to the standards stated in the consolidated financial statements. 32. Subsidiaries INVESTMENTS IN SUBSIDIARIES Investments in subsidiaries and other companies over which the company has a controlling interest or exercises central management are measured at net asset value. The net asset value is based on the measurement of assets, provisions and liabilities, and the determination of net profit in accordance with the accounting policies used in the consolidated financial statements. 33. Personnel Expenses April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Wages and Salaries (3,562) (3,115) Social Security (234) (200) Pension Costs (209) (209) Total Personnel Expenses (4,005) (3,524) The average number of employees in the company in this financial year was 21 FTEs (2021/2022: 19 FTEs). All the forementioned FTEs worked in the Netherlands. For an explanation of the remuneration of management, please refer to Note 28, Related Parties, of the consolidated financial statements. 34. Income Tax April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Current Tax Current Year (216) (594) Prior Years 218 (72) Deferred Tax – 113 Total Income Tax 2 (553) NOTES TO THE COMPANY FINANCIAL STATEMENTS IN THOUSANDS OF EUROS, UNLESS STATED OTHERWISE FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 106 NOTES TO THE COMPANY FINANCIAL STATEMENTS 35. Intangible Assets Development Costs Other Total As at March 31, 2021 Cost 1,922 121 2,043 Accumulated Amortization (1,803) (86) (1,889) Carrying Amount 119 35 154 Change in Asset Value Capital Expenditures – – – Transfer – – – Amortization (71) (15) (86) Balance (71) (15) (86) As at March 31, 2022 Cost 1,922 121 2,043 Accumulated Amortization (1,874) (101) (1,975) Carrying Amount 48 20 68 Change in Asset Value Capital Expenditures – – – Transfer – – – Amortization (48) (16) (64) Balance (48) (16) (64) As at March 31, 2023 Cost 1,922 121 2,043 Accumulated Amortization (1,922) (117) (2,039) Carrying Amount – 4 4 The company’s total expenses for research and development were € 1,770 in the financial year (2021/2022: € 1,542). Of this amount nil (2021/2022: nil) is capitalized, whereas the remainder is reported under Other Income and Expenses after Tax in the company financial statements. The costs of Amortization and Impairments of € 64 (2021/2022: € 86) are included in the Amortization item in the company financial statements. The Other Intangible Assets consist of the costs of computer software and licenses, and the external costs related to their implementation and commissioning. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 107 NOTES TO THE COMPANY FINANCIAL STATEMENTS 36. Property, Plant and Equipment Land and Buildings Machinery and Equipment Other Capital Assets Assets under Construction Total As at March 31, 2021 Cost 3,340 – 269 1 3,610 Accumulated Depreciation (2,196) – (253) – (2,449) Carrying Amount 1,144 – 16 1 1,161 Change in Asset Value Capital Expenditures – – – 74 74 Transfer Assets under Construction 74 – – (74) – Depreciation (44) – (6) – (50) Balance 30 – (6) – 24 As at March 31, 2022 Cost 3,414 – 269 1 3,684 Accumulated Depreciation (2,240) – (259) – (2,499) Carrying Amount 1,174 – 10 1 1,185 Change in Asset Value Capital Expenditures 1 – – 29 30 Transfer Assets under Construction – – 29 (29) – Depreciation (51) – (6) – (57) Balance (50) – 23 – (27) As at March 31, 2023 Cost 3,415 – 298 1 3,714 Accumulated Depreciation (2,291) – (265) – (2,556) Carrying Amount 1,124 – 33 1 1,158 The costs of Depreciation and Impairments of € 56 (2021/2022: € 50) are included in the Depreciation item in the company financial statements. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 108 NOTES TO THE COMPANY FINANCIAL STATEMENTS 37. Right-of-Use Assets The table below shows the movement of Right-of-Use Assets. These assets consist of capitalized lease contracts. Vehicles Total As at April 1, 2021 271 271 Change in Asset Value New Contracts 83 83 Depreciation (131) (131) Balance (48) (48) As at March 31, 2022 Carrying Amount 223 223 Change in Asset Value New Contracts 84 84 Remeasurement – – Depreciation (137) (137) Balance (53) (53) As at March 31, 2023 Carrying Amount 170 170 The company’s lease liabilities and maturity analysis are disclosed in note 41. 38. Financial Non-Current Assets The Financial Non-Current Assets can be specified as follows: March 31, 2023 March 31, 2022 Investments in Subsidiaries 53,499 50,280 Loans to Group companies 6,694 6,694 Deferred income tax assets 691 718 Financial Non-Current Assets 60,884 57,692 The table below shows movements in the investments in subsidiaries. April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Opening Balance 50,280 42,329 Movements: • Result from Subsidiaries 4,594 8,373 • Purchase of minority share PT HIJ 420 – • Dividend Declared (2,481) (1,692) • Currency Translation 715 1,270 • Other Changes (29) – Closing Balance 53,499 50,280 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 109 NOTES TO THE COMPANY FINANCIAL STATEMENTS Movements in the Loans to Group companies and Deferred Tax Assets are shown below. Deferred Tax Assets Loans to Group companies Total As at March 31, 2021 815 6,690 7,505 Additions 20 400 420 Withdrawals (117) (396) (513) As at March 31, 2022 718 6,694 7,412 Additions 26 – 26 Withdrawals (53) – (53) As at March 31, 2023 691 6,694 7,385 39. Equity For a clarification on the Share Capital and Share Premium, as well as the movement of the Foreign Currency Translation Reserve, Hedge Reserves and Other Reserves, please refer to the Statement of Equity and to Notes 19 and 20 of the consolidated balance sheet, as there are no differences between company Equity and consolidated Equity. PROPOSAL FOR THE APPROPRIATION OF PROFIT In compliance with Article 21 of the Articles of Association and the Dividend Policy as discussed in the Annual General Meeting of Shareholders of last year and set out on page 69 under Investor Relations, it is proposed to appropriate 50% of net profit to the other reserves. The proposal for appropriation of profit has not been included in the balance sheet. 40. Credit Facility The company has an available credit facility in the Netherlands of € 7,000 (March 31, 2022: € 7,000). Per end of March 2023, the company has not used this credit facility and no collaterals have been provided. 41. Lease Liabilities The company recognized Lease Liabilities on the balance sheet. The table below shows the movement and breakdown of Non-Current and Current Lease Liabilities. April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Opening Balance 252 340 Lease Payments (85) (171) New Contracts 84 83 Other Adjustments (78) – Closing Balance 173 252 April 1, 2022/ March 31, 2023 April 1, 2021/ March 31, 2022 Non-Current Lease Liabilities 90 134 Current Lease Liabilities 83 118 Total 173 252 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 110 NOTES TO THE COMPANY FINANCIAL STATEMENTS Maturity analysis – contractual undiscounted cashflows: March 31, 2023 March 31, 2022 Less than 1 year 89 122 Between 1 and 5 years 100 140 Longer than 5 years – – Total 189 262 42. Employee Benefit Obligations This employee benefit provision relates to the obligation to issue a conditional annual payment. The liabilities regarding employee benefits also include the item Other Employee Benefits. This relates to a provision for future jubilee payments of € 8 (March 31, 2022: € 11). Movements in the Employee Benefit Obligations were as follows: Pre-pension Plan the Netherlands Other Employee Benefits Total As at March 31, 2021 30 12 42 Additions 14 5 19 Withdrawals (11) (6) (17) As at March 31, 2022 33 11 44 Additions (2) (3) (5) Withdrawals (11) – (11) As at March 31, 2023 20 8 28 The following amounts have been accounted for as current under Other Liabilities and Accrued Income: Pre-pension Plan the Netherlands Other Employee Benefits Total As at March 31, 2023 8 – 8 As at March 31, 2022 19 5 24 43. Audit Fees The fees listed below relate to the procedures applied to the company and its consolidated group entities by the independent auditor, PricewaterhouseCoopers, as referred to in Section 1, subsection 1 of the Audit Firms Supervision Act (‘Wet toezicht accountantsorganisaties - Wta’) foreign-based network firms, including their tax services and advisory groups. 2022/2023 2021/2022 Audit of the Financial Statements 366 416 Other Audit Services – – Tax Services – – Other Non-Audit Services – – Audit Fees 366 416 The total costs of PricewaterhouseCoopers Accountants NV for their procedures in the Netherlands amount to € 262 (previous year: € 328). The remaining € 104 (previous year: € 88) were charged to the company by other PwC network entities. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 111 NOTES TO THE COMPANY FINANCIAL STATEMENTS 44. Other Disclosures WRITTEN GUARANTEE Holland Colours NV has given a guarantee for its subsidiary Holland Colours Europe BV in accordance with Section 403, Title 9, Book 2 of the Dutch Civil Code, and according to Section 479A of the Companies Act on behalf of its subsidiary Holland Colours UK Ltd. Holland Colours NV has not issued any other written guarantee as security for the payment obligations of foreign companies. FISCAL UNITY The company forms a tax unity together with Holland Colours Europe BV with regard to income tax and sales tax. Both the company and its subsidiary are jointly and severally liable for tax payable by all companies that are part of the tax entity. SUBSEQUENT EVENTS Apeldoorn, June 1, 2023 Board of Management Supervisory Board Coen Vinke Roland Zoomers Eelco van Hamersveld Gert-Hein de Heer Aukje Doornbos Jorrit Klaus FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 112 Statutory Provisions regarding the Appropriation of Profits REGARDING THE APPROPRIATION OF PROFITS, THE ARTICLES OF ASSOCIATION STATE THE FOLLOWING: Article 21 From the profit established in the approved financial statements, reserves are formed as determined by the Board of Management with the approval of the Supervisory Board. The profit remaining after the transfer to the reserves and distribution as stated in paragraph 1 is at the disposal of the Annual General Meeting of Shareholders, with due regard to the provisions of Section 105, Book 2 of the Dutch Civil Code. The Board of Management, with the approval of the Supervisory Board, is authorized to decide on the distribution of an interim dividend with due regard to the provisions of Article 105 Book 2 of the Dutch Civil Code. The dividend will be made payable within one month after it has been set, in the manner and at the place determined by the Board of Management. Claims for profit distribution expire after a period of five years from the date on which the dividends were made payable. A resolution regarding the disposal of any reserve may be adopted by the Annual General Meeting of Shareholders with due regard to the legal and statutory provisions. OTHER INFORMATION FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 113113 Independent Auditor’s Report To: the general meeting and the supervisory board of Holland Colours N.V. REPORT ON THE FINANCIAL STATEMENTS 2022/2023 Our opinion In our opinion: • theconsolidatednancialstatementsofHolland Colours N.V. together with its subsidiaries (‘the Group’) giveatrueandfairviewofthenancialpositionofthe Group as at 31 March 2023 and of its result and cash owsfortheyearthenendedinaccordancewith International Financial Reporting Standards as adopted by the European Union (‘EU-IFRS’) and with Part 9 of Book 2 of the Dutch Civil Code; • thecompanynancialstatementsofHollandColours N.V. (‘the Company’) give a true and fair view of the nancialpositionoftheCompanyasat31March2023 and of its result for the year then ended in accordance with Part 9 of Book 2 of the Dutch Civil Code. What we have audited We have audited the accompanying financial statements 2022/2023 of Holland Colours N.V., Apeldoorn. The financial statements comprise the consolidated financial statements of the Group and the company financial statements. Theconsolidatednancialstatementscomprise: • the consolidated balance sheet as at 31 March 2023; • thefollowingstatementsfornancialyearended31 March 2023: the consolidated income statement, the consolidated statements of comprehensive income, the consolidated statement of changes in equity, the consolidatedcashowstatement;and • thenotes,comprisingasummaryofthesignicant accounting policies and other explanatory information. The company financial statements comprise: • the company balance sheet as at 31 March 2023; • thecompanyincomestatementforthenancialyear ended 31 March 2023; and • the notes, comprising a summary of the accounting policies applied and other explanatory information. The financial reporting framework applied in the preparation of the financial statements is EU-IFRS and the relevant provisions of Part 9 of Book 2 of the Dutch Civil Code for the consolidated financial statements and Part 9 of Book 2 of the Dutch Civil Code for the company financial statements. The basis for our opinion We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing. We have further described our responsibilities under those standards in the section ‘Our responsibilities for the audit of the financial statements’ of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence We are independent of Holland Colours N.V. in accordance with the European Union Regulation on specific requirements regarding statutory audit of public-interest entities, the ‘Wet toezicht accountantsorganisaties’ (Wta, Audit firms supervision act), the ‘Verordening inzake de onafhankelijkheid van accountants bij assuranceopdrachten’ (ViO, Code of Ethics for Professional Accountants, a regulation with respect to independence) and other relevant independence regulations in the Netherlands. Furthermore, we have complied with the ‘Verordening gedrags- en beroepsregels accountants’ (VGBA, Dutch Code of Ethics). Our audit approach We designed our audit procedures with respect to the key audit matters, fraud and going concern, and the matters resulting from that, in the context of our audit of the financial statements as a whole and in forming our opinion thereon. The information in support of our opinion, such as our findings and observations related to individual key audit matters, the audit approach fraud risk and the audit approach going concern was addressed in this context, and we do not provide a separate opinion or conclusion on these matters. OTHER INFORMATION FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 114 Overview and context Holland Colours N.V. manufactures, distributes and sells solid and liquid colours and additive concentrates. The Group is comprised of several components and therefore we considered our group audit scope and approach as set out in the section ‘The scope of our group audit’. We paid specific attention to the areas of focus driven by the operations of the Group, as set out below. As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements. In particular, we considered where the board of management made important judgements, for example, in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. In these considerations, we paid attention to, amongst others, the assumptions underlying the physical and transition risk related to climate change. In note 3 of the financial statements, the Company describes the areas of judgement in applying accounting policies and the key sources of estimation uncertainty. Given the estimation uncertainty, magnitude and the related inherent risks of material misstatement in the valuation of inventory, we considered this to be a key audit matter as set out in the section ‘Key audit matters’ of this report. Furthermore, we identified revenue recognition as a key audit matter because of the various price agreements and terms and conditions for delivery of the product to customers. Holland Colours N.V. assessed the possible effects of climate change on its financial position, refer to the annual report section ‘Environmental, Social and Governance’ (pages 38-48). We discussed Holland Colours N.V.’s assessment and governance thereof with the board of management and evaluated the potential impact on the financial position including underlying assumptions and estimates. We ensured that the audit teams at both group and component level included the appropriate skills and competences which are needed for the audit of an international manufacturing company. To increase the quality of the audit, we also included IT specialists in our team, who, working centrally, performed specified audit procedures on IT and reported the findings to our component teams. The outline of our audit approach was as follows: Materiality Audit scope Key audit matters Materiality • Overall materiality: €1,100,000 Audit scope • TheGroupconsistsoffoursignicantcomponents:HollandColoursN.V.,HollandColours Europe B.V., Holland Colours Americas Inc., and PT Holland Colours Asia in Indonesia, and six othernon-signicantcomponents. • AttheheadoceinApeldoorn,theNetherlands,thePwCgroupengagementteamaudited Holland Colours N.V. and Holland Colours Europe B.V. and instructed the component auditors inIndonesiaandtheUSAtoperformanauditonthecompletesetofnancialinformation. • The PwC group engagement team instructed the component auditor in Hungary to perform speciedauditproceduresforgrouppurposes.Thisconsistedofattendinginventorycountsin Hungary. • Audit coverage: 88% of consolidated revenue, 94% of consolidated total assets and 83% of consolidatedprotbeforetax. Key audit matters • Revenue recognition • Assumptions in the valuation of inventory OTHER INFORMATION FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 115 Materiality The scope of our audit was influenced by the application of materiality, which is further explained in the section ‘Our responsibilities for the audit of the financial statements’. Based on our professional judgement we determined certain quantitative thresholds for materiality, including the overall materiality for the financial statements as a whole as set out in the table below. These, together with qualitative considerations, helped us to determine the nature, timing and extent of our audit procedures on the individual financial statement line items and disclosures and to evaluate the effect of identified misstatements, both individually and in aggregate, on the financial statements as a whole and on our opinion. OTHER INFORMATION Overall group materiality €1,100,000 (2021/2022: €1,000,000). Basis for determining materiality We used our professional judgement to determine overall materiality. As a basis for our judgement, we used 1% of revenue rounded to €1,100,000. Rationale for benchmark applied We used revenue as the primary benchmark, a generally accepted auditing practice, based on our analysis of the common information needs of the users of the financial statements. From a stakeholder’s perspective, the long-term horizon and sustainable growth are reflected through consideration of revenue. The Group has a strategic focus on extending global market positions and the focus on revenue therefore makes revenue in itself an important metric for the financial performance of the Group. Component materiality Based on our judgement, we allocate materiality to each component in our audit scope that is less than our overall group materiality. The range of materiality allocated across components was between €500,000 and €1,090,000. We also take misstatements and/or possible misstatements into account that, in our judgement, are material for qualitative reasons. We agreed with the supervisory board that we would report to them any misstatement identified during our audit above €54,500 (2021/2022: €50,000) as well as misstatements below that amount that, in our view, warranted reporting for qualitative reasons. The scope of our Group audit Holland Colours N.V. is the parent company of a group of entities. The financial information of this group is included in the consolidated financial statements of Holland Colours N.V. We tailored the scope of our audit to ensure that we, in aggregate, provide sufficient coverage of the financial statements for us to be able to give an opinion on the financial statements as a whole, taking into account the management structure of the Group, the nature of operations of its components, the accounting processes and controls, and the markets in which the components of the Group operate. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 116 In establishing the overall group audit strategy and plan, we determined the type of work required to be performed at component level by the group engagement team and by each component auditor. Our audit primarily focussed on the significant components of the Group: Holland Colours N.V. (company only), Holland Colours Europe B.V., Holland Colours Americas Inc., and PT Holland Colours Asia. Due to their significance within the Group, an audit of the complete set of financial information was performed on these components. In total, in performing these procedures, we achieved the following coverage on the financial line items: Revenue 88% Total assets 94% Profit before tax 83% For those remaining components we performed, among other things, analytical procedures to corroborate our assessment that there were no significant risks of material misstatements within those components. The Group engagement team performed the audit work for Group entities Holland Colours N.V. and Holland Colours Europe B.V. For the components Holland Colours Americas Inc. and PT Holland Colours Asia, as well as for the stock count procedures relating to the inventory of Holland Colours Europe B.V. in Hungary, we used component auditors from the PwC network. These auditors are familiar with the local laws and regulations required to perform this audit work. Where component auditors performed the audit, we determined the level of involvement we needed to have in their work to be able to conclude whether we had obtained sufficient and appropriate audit evidence as a basis for our opinion on the consolidated financial statements as a whole. We issued instructions to the component audit teams in our audit scope. These instructions included, amongst others, our risk analysis, materiality, and the scope of the work. We explained to the component audit teams the structure of the Group, the main developments that were relevant for the component auditors, the risks identified, the materiality levels to be applied, and our global audit approach. We held individual calls with each of the in-scope component audit teams both during the year and upon conclusion of their work. During these calls, we discussed any significant accounting and audit issues identified by the component auditors, their reports, the findings of their procedures and other matters that could be of relevance for the consolidated financial statements. The Group engagement team performed the audit work on the consolidation, financial statement preparation (including disclosures) and a number of more complex items. These included lease accounting and the going concern analysis. The Group engagement team held virtual meetings with the component audit teams. For these virtual meetings sufficient time was taken and we remotely reviewed selected working papers of the respective component auditors and sufficient involvement was achieved. The Group engagement team performed the audit for the entities Holland Colours N.V. and Holland Colours Europe B.V. on site and held regular meetings with Group management. By performing the procedures outlined above at the components, combined with additional procedures exercised at Group level, we have been able to obtain sufficient and appropriate audit evidence on the Group’s financial information as a whole, to provide a basis for our opinion on the financial statements. Audit approach fraud risks We identified and assessed the risks of material misstatements of the financial statements due to fraud. During our audit we obtained an understanding of the Group and its environment and the components of the internal control system. This included management’s risk assessment process, management’s process for responding to the risks of fraud and monitoring the internal control system, and how the supervisory board exercised oversight. OTHER INFORMATION FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 117 We refer to section ‘Risk Management’ in the report of the board of management for management’s fraud risk assessment and section ‘Audit Committee’ of the supervisory board report in which the supervisory board reflects on this fraud risk assessment. We evaluated the design and relevant aspects of the internal control system and in particular the fraud risk assessment, as well as the code of conduct, whistle-blower procedures and incident registration. We evaluated the design and the implementation of internal controls designed to mitigate fraud risks and noted further enhancement and formalisation of controls and procedures in the financial year to a more mature level appropriate for the international footprint and size of the Group. We reported our observations to the board of management and the persons charged with governance. As part of our process of identifying fraud risks, we evaluated fraud risk factors with respect to financial reporting fraud, misappropriation of assets and bribery and corruption. We evaluated whether these factors indicate that a risk of material misstatement due to fraud is present and we have evaluated the remedial actions that the company has taken with respect to reported risk-related events in previous year. OTHER INFORMATION FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 118 We identified the following fraud risks and performed the following specific procedures: Identified fraud risks Our audit work and observations Fraud risk 1 Management override of controls Management is in a unique position to perpetrate fraud because of management’s ability to manipulate accounting records and prepare fraudulent financial statements by overriding controls that otherwise appear to be operating effectively. That is why, in all our audits, we pay attention to the risk of management override of controls and in this context, we paid attention to: • the appropriateness of journal entries and other adjustments made in the preparation of the financial statements; • potential biases in estimates; • significant transactions, if any, outside the normal course of business. We evaluated the design of the internal control measures mitigating the risk of management override of controls and assessed the internal controls in the processes of generating journal entries, making significant estimates and booking of revenue. We also paid specific attention that access safeguards in the IT system supports segregation of duties. We assessed whether deficiencies in controls may create opportunities for fraud. We performed journal entry testing procedures based on the following criteria: unexpected account combinations which increases revenue or decreases costs and unexpected users. In addition, we tested manual consolidation adjustments. With regard to management’s accounting estimates, we evaluated key estimates and judgements for bias, including retrospective reviews of prior year’s estimates. We performed substantive audit procedures for significant estimates such as valuation of inventory as well as for non-significant estimates. We did not identify any significant transactions outside the normal course of business. Our audit procedures did not lead to specific indications of fraud or suspicions of fraud with respect to management override of controls. OTHER INFORMATION FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 119 Identified fraud risks Our audit work and observations Fraud risk 2 The risk of fraudulent financial reporting due to overstating revenue Given the listed status of Holland Colours N.V., its objective is to meet certain market and shareholder expectations, management bonuses and financial targets for management and based on a presumption that there are risks of fraud in revenue recognition, revenue recognition was subject to the risk of a material misstatement due to fraud. Above matters could lead to pressure on management to overstate revenue by recognising fictitious revenue transactions or by recognising revenue transactions which have not been realised yet, affecting the assertions existence/occurrence and cut off. In addition to the audit procedures and observations mentioned at the key audit matter ‘Revenue recognition’ we performed the following procedures on the risk of overstating revenue by recognising fictitious revenue transactions or by recognising revenue transactions which have not been realised yet, affecting the assertions existence/occurrence and cut-off: • We evaluated the design and implementation of the internal control system in the processes related to revenue reporting. • We evaluated the design and tested the operating effectiveness of the control activities on the exception report to ensure the accuracy and existence of revenue recognition. In this exception report, created by the Group, deviations between order prices and invoiced prices and shipped quantities and invoiced quantities were identified, explained, and followed up. • We selected journal entries with unexpected account combinations with a credit to revenue and conducted specific audit procedures for these entries. These procedures included, amongst others, inspection of the entries to source documentation. • We tested the manual journal entry to adjust for appropriate cut-off of revenue recognition. • We performed substantive audit procedures on credit invoices after year end and on credit invoices during 2022/2023. • We tested, on a sample basis, the delivered performance and transaction prices of the revenue transaction based on invoices, order confirmations, sales agreements, shipping documents and bank receipts. • For our work on the existence/occurrence of revenue transactions we leveraged upon the related work performed for account receivable, such as the work on subsequent receipts of accounts receivables. • Performed substantive audit procedures over revenue transactions before and after year end to determine appropriate cut-off. Our audit procedures did not lead to specific indications of fraud or suspicions of fraud with respect to the existence/occurrence of the revenue reported. OTHER INFORMATION FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 120 We incorporated an element of unpredictability in our audit. During the audit, we remained alert to indications of fraud. We also considered the outcome of our other audit procedures and evaluated whether any findings were indicative of fraud or non-compliance of laws and regulations. Whenever we identify any indications of fraud, we re-evaluate our fraud risk assessment and its impact on our audit procedures. Audit approach going concern As disclosed in section ‘Going concern’ on page 79 of the financial statements, the board of management performed their assessment of the entity’s ability to continue as a going concern for at least twelve months from the date of preparation of the financial statements and has not identified events or conditions that may cast significant doubt on the entity’s ability to continue as a going concern (hereafter: going-concern risks). Our procedures to evaluate the board of management’s going-concern assessment included, amongst others: • considering whether the board of management’s going-concern assessment includes all relevant information of which we are aware as a result of our audit and inquiring with the board of management regarding the board of management’s most important assumptions underlying its going-concern assessment. • evaluating the board of management’s current budget including cash flows for at least twelve months from the date of preparation of the financial statements taken into account current developments in the industry and all relevant information of which we are aware as a result of our audit; • evaluating the Company’s existing on-balance and off-balance obligations; • performing inquiries of the board of management as to its knowledge of going-concern risks beyond the period of the board of management’s assessment. Our procedures did not result in outcomes contrary to the Board of Management’s assumptions and judgements used in the application of the going concern assumption. Key audit matters Key audit matters are those matters that, in our professional judgement, were of most significance in the audit of the financial statements. We have communicated the key audit matters to the supervisory board. The key audit matters are not a comprehensive reflection of all matters identified by our audit and that we discussed. In this section, we described the key audit matters and included a summary of the audit procedures we performed on those matters. OTHER INFORMATION FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 121 Key audit matter Our audit work and observations Revenue recognition The accounting principles for revenue recognition are included in ‘Summary of accounting principles’ (note 3) in the financial statements. Revenue is recognised when a performance obligation is satisfied by transferring control over a promised good or service. A contract with a customer generally has one performance obligation, which is satisfied at a certain point in time. The Group applies price agreements per customer and various terms and conditions for delivery of its products to customers. Given the variety in terms and conditions for delivery, determining the timing of transfer of control of the promised goods is inherently complex and due to the magnitude, the number of transactions and the client specific price agreements, this could potentially lead to materially misstated revenue. Based on the above considerations we considered this area to be a key audit matter. We updated our understanding of the Group’s revenue recognition policies and where relevant to our audit, we assessed the design and effectiveness of the internal control measures related to revenue reporting and in the processes for generating and processing journal entries related to the revenue. We evaluated the design and tested the operating effectiveness of the control activities on the exception report to ensure the accuracy and existence of revenue recognition. In this exception report, created by the Group, deviations between order prices and invoiced prices and shipped quantities and invoiced quantities were identified, explained, and followed up. We obtained the exception report and, together with IT specialists, assessed the reliability of the report by reconciling the exception report to the financial administration. We reperformed the analysis and evaluated the outcome and the follow-up by the Group. To establish accuracy and existence we tested, on a sample basis, the delivered performance and transaction prices of the revenue transaction based on invoices, order confirmations, sales agreements, shipping documents and bank receipts. With respect to the cut-off, we obtained the Group’s revenue recognition analysis. We then tested the mathematical accuracy and the reliability of the underlying data by reconciling the analysis to the invoiced revenue in the last period, and the revenue adjustment to the journal entry recorded. In addition, we tested a sample of the sales transactions in the period immediately before and after the Company’s year end. We did this by tracing the information related to the date of transfer of control to shipping documents and client specific contractual terms and conditions. The audit procedures were performed by the Group engagement team and by the component teams in Indonesia and the USA. Our procedures did not indicate material findings. OTHER INFORMATION FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 122 Key audit matter Our audit work and observations Assumptions in the valuation of inventory The board of management’s assumptions are included in note 3 paragraph Inventories and note 16 of the financial statements. With a value of €15.6 million (31 March 2022: €20.6 million), inventory is one of the significant assets of the Group. Due to its nature, it is subject to market developments that require management judgement. This management judgement especially relates to the valuation of raw materials that are subject to obsolescence due to changing recipes, and to finished goods that are produced for specific clients (including the surcharge for overhead). At year end, this is reflected in the valuation against the net realisable value, through recognition of an inventory allowance of €1.2 million (31 March 2022: €1.0 million). Marking products as (partly) obsolescent is based on an inventory report and the assessment whether inventory will be sold, which requires management’s judgement. Inaccurate pricing and/or obsolescence assessment may, given the significant balance of inventory, result in the inventory being materially misstated. Therefore, we considered this to be a key audit matter. As part of our risk assessment procedures, we performed look-back procedures to assess the quality of management estimates. This involved comparing the actual write-offs in the current financial year to the inventory allowance in previous years’ financial statements. We also performed substantive audit procedures on the calculation of the standard cost prices against which the inventory is initially valued. This included testing a sample of components in the standard cost price of finished goods by reconciling the raw material component to purchase invoices. In addition, we tested the surcharge for overhead by performing analytical procedures. Here, we compared our expectation with the actual surcharge for overhead included in the inventory valuation as of 31 March 2023. Furthermore, we performed an overall analysis of price- and efficiency variances recorded during the year to test the accuracy of the costing method used for finished goods. We tested the reliability of the inventory ageing report together with IT specialists. This report is used by management to assess the ageing of the inventory. We challenged the Group’s assumptions related to the valuation per ageing category based on actual write-offs and the actual developments in inventory ageing. We reviewed revenue on product level for negative margins, which could indicate a lower market value, and discussed developments in the product portfolio and pricing. Our procedures did not indicate material findings with respect to estimates and judgements in the valuation of inventory. OTHER INFORMATION FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 123 REPORT ON THE OTHER INFORMATION INCLUDED IN THE ANNUAL REPORT The annual report contains other information. This includes all information in the annual report in addition to the financial statements and our auditor’s report thereon. Based on the procedures performed as set out below, we conclude that the other information: • isconsistentwiththenancialstatementsanddoes not contain material misstatements; and • contains all the information regarding the directors’ report and the other information that is required by Part 9 of Book 2 and regarding the remuneration report required by the sections 2:135b and 2:145 subsection 2 of the Dutch Civil Code. We have read the other information. Based on our knowledge and the understanding obtained in our audit of the financial statements or otherwise, we have considered whether the other information contains material misstatements. By performing our procedures, we comply with the requirements of Part 9 of Book 2 and section 2:135b subsection 7 of the Dutch Civil Code and the Dutch Standard 720. The scope of such procedures was substantially less than the scope of those procedures performed in our audit of the financial statements. The board of management is responsible for the preparation of the other information, including the directors’ report and the other information in accordance with Part 9 of Book 2 of the Dutch Civil Code. The board of management and the supervisory board are responsible for ensuring that the remuneration report is drawn up and published in accordance with sections 2:135b and 2:145 subsection 2 of the Dutch Civil Code. REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS AND ESEF Our appointment We were appointed as auditors of Holland Colours N.V. on 10 July 2014 by the supervisory board. This followed the passing of a resolution by the shareholders at the annual general meeting held on 10 July 2014. Our appointment has been renewed annually by shareholders and now represents a total period of uninterrupted engagement of nine years. European Single Electronic Format (ESEF) Holland Colours N.V. has prepared the annual report in ESEF. The requirements for this are set out in the Delegated Regulation (EU) 2019/815 with regard to regulatory technical standards on the specification of a single electronic reporting format (hereinafter: the RTS on ESEF). In our opinion, the annual report prepared in XHTML format, including the (partially) marked-up consolidated financial statements, as included in the reporting package by Holland Colours N.V., complies in all material respects with the RTS on ESEF. The board of management is responsible for preparing the annual report, including the financial statements in accordance with the RTS on ESEF, whereby the board of management combines the various components into a single reporting package. Our responsibility is to obtain reasonable assurance for our opinion whether the annual report in this reporting package complies with the RTS on ESEF. We performed our examination in accordance with Dutch law, including Dutch Standard 3950N ‘Assuranceopdrachten inzake het voldoen aan de criteria voor het opstellen van een digitaal verantwoordingsdocument’ (assurance engagements relating to compliance with criteria for digital reporting). Our examination included amongst others: • Obtaininganunderstandingoftheentity’snancial reporting process, including the preparation of the reporting package. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 124 • Identifying and assessing the risks that the annual report does not comply in all material respects with the RTS on ESEF and designing and performing further assurance procedures responsive to those risks to provide a basis for our opinion, including: • obtaining the reporting package and performing validations to determine whether the reporting package containing the Inline XBRL instance documentandtheXBRLextensiontaxonomyles have been prepared in accordance with the technicalspecicationsasincludedintheRTSon ESEF; • examining the information related to the consolidatednancialstatementsinthereporting package to determine whether all required mark- ups have been applied and whether these are in accordance with the RTS on ESEF. No prohibited non-audit services To the best of our knowledge and belief, we have not provided prohibited non-audit services as referred to in article 5(1) of the European Regulation on specific requirements regarding statutory audit of public-interest entities. Services rendered In addition to the audit, we have provided no services to the Company or its controlled entities for the period to which our audit relates. RESPONSIBILITIES FOR THE FINANCIAL STATEMENTS AND THE AUDIT Responsibilities of the Board of Management and the supervisory board for the financial statements The board of management is responsible for: • thepreparationandfairpresentationofthenancial statements in accordance with EU-IFRS and Part 9 of Book 2 of the Dutch Civil Code; and for • such internal control as the board of management determines is necessary to enable the preparation of thenancialstatementsthatarefreefrommaterial misstatement, whether due to fraud or error. As part of the preparation of the financial statements, the board of management is responsible for assessing the Company’s ability to continue as a going concern. Based on the financial reporting frameworks mentioned, the board of management should prepare the financial statements using the going-concern basis of accounting unless the board of management either intends to liquidate the Company or to cease operations or has no realistic alternative but to do so. The board of management should disclose in the financial statements any event and circumstances that may cast significant doubt on the Company’s ability to continue as a going concern. The supervisory board is responsible for overseeing the Company’s financial reporting process. Our responsibilities for the audit of the financial statements Our responsibility is to plan and perform an audit engagement in a manner that allows us to obtain sufficient and appropriate audit evidence to provide a basis for our opinion. Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high but not absolute level of assurance, which makes it possible that we may not detect all material misstatements. Misstatements may arise due to fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements. Materiality affects the nature, timing and extent of our audit procedures and the evaluation of the effect of identified misstatements on our opinion. A more detailed description of our responsibilities is set out in the appendix to our report. Utrecht, 1 June 2023 PricewaterhouseCoopers Accountants N.V. W.F.J. Vermeulen RA FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 125 Appendix to our auditor’s report on the financial statements 2022/2023 of Holland Colours N.V. In addition to what is included in our auditor’s report, we have further set out in this appendix our responsibilities for the audit of the financial statements and explained what an audit involves. THE AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS We have exercised professional judgement and have maintained professional scepticism throughout the audit in accordance with Dutch Standards on Auditing, ethical requirements and independence requirements. Our audit consisted, among other things of the following: • Identifying and assessing the risks of material misstatement of the financial statements, whether due to fraud or error, designing and performing audit procedures responsive to those risks, and obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the intentional override of internal control. • Obtaining an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control. • Evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the board of management. • Concluding on the appropriateness of the board of management’s use of the going-concern basis of accounting, and based on the audit evidence obtained, concluding whether a material uncertainty exists related to events and/or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report and are made in the context of our opinion on the financial statements as a whole. However, future events or conditions may cause the Company to cease to continue as a going concern. • Evaluating the overall presentation, structure and content of the financial statements, including the disclosures, and evaluating whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. Considering our ultimate responsibility for the opinion on the consolidated financial statements, we are responsible for the direction, supervision and performance of the group audit. In this context, we have determined the nature and extent of the audit procedures for components of the Group to ensure that we performed enough work to be able to give an opinion on the financial statements as a whole. Determining factors are the geographic structure of the Group, the significance and/or risk profile of group entities or activities, the accounting processes and controls, and the industry in which the Group operates. On this basis, we selected group entities for which an audit or review of financial information or specific balances was considered necessary. We communicate with the supervisory board regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. In this respect, we also issue an additional report to the audit committee in accordance with article 11 of the EU Regulation on specific requirements regarding statutory audit of public-interest entities. The information included in this additional report is consistent with our audit opinion in this auditor’s report. We provide the supervisory board with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related actions taken to eliminate threats or safeguards applied. From the matters communicated with the supervisory board, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, not communicating the matter is in the public interest. FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 126 CONTACT HOLLAND COLOURS NV Halvemaanweg 1 7323 RW Apeldoorn P.O. Box 720 7300 AS Apeldoorn The Netherlands T (31) 55-368 0700 E [email protected] Chamber of Commerce 08036180 HOLLAND COLOURS EUROPE BV Halvemaanweg 1 7323 RW Apeldoorn P.O. Box 720 7300 AS Apeldoorn The Netherlands T (31) 55-368 0700 E [email protected] HOLLAND COLOURS UK LTD Unit 16/17/18, Sabre Court Valentine Close, Gillingham Business Park Gillingham, Kent ME8 0RW United Kingdom T (44) 1634-388 727 E [email protected] HOLLAND COLOURS HUNGARIA KFT Déri Miksa körút 2 P.O. Box 8 5000 Szolnok Hungary T (36) 56-420 644 E [email protected] HOLLAND COLOURS AMERICAS INC 1501 Progress Drive Richmond, Indiana, 47374 USA T (1) 765-935 0329 Toll-free (1) 800-723-0329 E [email protected] HOLLAND COLOURS CANADA INC 200 Consumers Rd, Suite 303 Toronto, Ontario M2J 4R4 Canada T (1) 416-449 4344 Toll-free (1) 800-361 3967 E [email protected] HOLLAND COLOURS MEXICANA SA DE CV Tezosomoc #4 (Bodega 3) Col. Recursos Hidráulicos Tultitlán, Edo de México México CP 54913 T 52 (55) 58-94-36-41 E [email protected] PT HOLLAND COLOURS ASIA - SURABAYA Jl. Berbek Industri II/2 (Surabaya Industrial Estate Rungkut) Sidoarjo 61256-East Java Indonesia T (62) 31-849 3939 E [email protected] Export department Surabaya: T (62) 31-841 1 801 E [email protected] PT HOLLAND COLOURS ASIA – JAKARTA Kawasan Industri dan Pergudangan TAMAN TEKNO BSD Blok E3 no. 45 Kecamatan SETU, Tangerang Selatan, Banten 15314-West Java Indonesia T (62) 21-75681088 E [email protected] REPRESENTATIVE OFFICE CHINA Room 908, Eco City 1788, No. 1788 West Nanjing Road, Jing’an District Shanghai 20040 China T (86) 13022112583 (60) 162222684 E [email protected] FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTSFINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 127 FIVE-YEAR SUMMARY & INVESTOR RELATIONSSUPERVISORY BOARD REPORTCSR EMPLOYEE PARTICIPATIONREMUNERATION REPORTGOVERNANCEMANAGEMENT BOARD REPORTABOUT INTRODUCTION BY THE CEO FINANCIAL STATEMENTS HOLLAND COLOURS ANNUAL REPORT 2022/2023 128 FIND OUT MORE Contact our sales people about purchasing quantities and deliveries or our technical experts for questions about our technology and its implementation: AMERICAS: [email protected] | +1 765-935 0329 / toll-free: +1 800 723 0329 ASIA: [email protected] | +62 31 849 3939 EMEIA: [email protected] | +31 (0)55 36 80 700 www.hollandcolours.com 7245003GZ2696Y0W1X572022-04-012023-03-317245003GZ2696Y0W1X572021-04-012022-03-317245003GZ2696Y0W1X572023-03-317245003GZ2696Y0W1X572022-03-317245003GZ2696Y0W1X572021-03-31ifrs-full:IssuedCapitalMember7245003GZ2696Y0W1X572021-03-31ifrs-full:SharePremiumMember7245003GZ2696Y0W1X572021-03-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember7245003GZ2696Y0W1X572021-03-31HOL:ReserveOfIntangibleAssetsMember7245003GZ2696Y0W1X572021-03-31ifrs-full:RetainedEarningsMember7245003GZ2696Y0W1X572021-03-31ifrs-full:EquityAttributableToOwnersOfParentMember7245003GZ2696Y0W1X572021-03-31ifrs-full:NoncontrollingInterestsMember7245003GZ2696Y0W1X572021-03-317245003GZ2696Y0W1X572021-04-012022-03-31ifrs-full:IssuedCapitalMember7245003GZ2696Y0W1X572022-03-31ifrs-full:IssuedCapitalMember7245003GZ2696Y0W1X572021-04-012022-03-31ifrs-full:SharePremiumMember7245003GZ2696Y0W1X572022-03-31ifrs-full:SharePremiumMember7245003GZ2696Y0W1X572021-04-012022-03-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember7245003GZ2696Y0W1X572022-03-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember7245003GZ2696Y0W1X572021-04-012022-03-31HOL:ReserveOfIntangibleAssetsMember7245003GZ2696Y0W1X572022-03-31HOL:ReserveOfIntangibleAssetsMember7245003GZ2696Y0W1X572021-04-012022-03-31ifrs-full:RetainedEarningsMember7245003GZ2696Y0W1X572022-03-31ifrs-full:RetainedEarningsMember7245003GZ2696Y0W1X572021-04-012022-03-31ifrs-full:EquityAttributableToOwnersOfParentMember7245003GZ2696Y0W1X572022-03-31ifrs-full:EquityAttributableToOwnersOfParentMember7245003GZ2696Y0W1X572021-04-012022-03-31ifrs-full:NoncontrollingInterestsMember7245003GZ2696Y0W1X572022-03-31ifrs-full:NoncontrollingInterestsMember7245003GZ2696Y0W1X572022-04-012023-03-31ifrs-full:IssuedCapitalMember7245003GZ2696Y0W1X572023-03-31ifrs-full:IssuedCapitalMember7245003GZ2696Y0W1X572022-04-012023-03-31ifrs-full:SharePremiumMember7245003GZ2696Y0W1X572023-03-31ifrs-full:SharePremiumMember7245003GZ2696Y0W1X572022-04-012023-03-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember7245003GZ2696Y0W1X572023-03-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember7245003GZ2696Y0W1X572022-04-012023-03-31HOL:ReserveOfIntangibleAssetsMember7245003GZ2696Y0W1X572023-03-31HOL:ReserveOfIntangibleAssetsMember7245003GZ2696Y0W1X572022-04-012023-03-31ifrs-full:RetainedEarningsMember7245003GZ2696Y0W1X572023-03-31ifrs-full:RetainedEarningsMember7245003GZ2696Y0W1X572022-04-012023-03-31ifrs-full:EquityAttributableToOwnersOfParentMember7245003GZ2696Y0W1X572023-03-31ifrs-full:EquityAttributableToOwnersOfParentMember7245003GZ2696Y0W1X572022-04-012023-03-31ifrs-full:NoncontrollingInterestsMember7245003GZ2696Y0W1X572023-03-31ifrs-full:NoncontrollingInterestsMemberiso4217:EURxbrli:sharesiso4217:EURxbrli:shares
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