Schouw &amp; Co. — Annual Report 2021

sheets are translated at the exchange rates ruling at the balance sheet date. The average exchange rate for each individual month is used as the transaction date exchange rate. Exchange differences arising on the translation of the opening equity of such enterprises at the exchange rates ruling at the balance sheet date and on the translation of the income statements from the exchange rates ruling at the transaction date to the exchange rates ruling at the balance sheet date are recognised in other comprehensive income in the exchange adjustment reserve under equity. Foreign exchange adjustment of balances that are considered as part of the overall net investment in enterprises with functional currencies other than Danish kroner, are recognised directly in other comprehensive income in the exchange adjustment reserve under equity. Similarly, exchange gains and losses on the part of loans and derivative financial instruments effectively hedging the net investment in such enterprises are recognised in other comprehensive income in

On consolidation of associates and joint ventures with functional currencies other than Danish kroner, the pro-rata share of the results is translated at the exchange rates ruling at the transaction date, and the share of equity including goodwill is translated at the exchange rates ruling at the balance sheet date. Exchange differences arising on the translation of the share of the opening equity of foreign associates at exchange rates ruling at the balance sheet date and on the translation of the share of the results for the year from average exchange rates to the exchange rates ruling at the balance sheet date are recognised in other comprehensive income in the exchange adjustment reserve under equity.

the exchange adjustment reserve under equity.

Derivative financial instruments

Derivative financial instruments are measured at fair value and recognised in the balance sheet under other receivables or other payables, respectively. The fair value of derivative financial instruments is calculated on the basis of current market data and recognised valuation methods.

Changes in the fair value of derivative financial instruments that effectively hedge the fair value of a recognised asset or a recognised liability are recognised in the income statement together with any changes in the value of the hedged asset or hedged liability. Hedging of future cash flows under agreements are treated as hedging of the fair value of a recognised asset or a recognised liability.

Changes in the part of the fair value of derivative financial instruments effectively hedging future cash flows are recognised in other comprehensive income in the reserve for hedging transactions under equity. On realisation of the hedged transaction, any gains or losses relating to such hedge transactions are transferred from other comprehensive income and recognised in the same item as the hedged item.

Changes in the fair value of derivative financial instruments effectively hedging net investments in foreign subsidiaries

or associates are recognised in other comprehensive income in the exchange adjustment reserve under equity.

For derivative financial instruments that do not qualify for hedge accounting, changes in fair value are recognised as interest income or expenses and similar items in the income statement as they occur.

Shareholders' equity

The hedge transaction reserve contains the accumulated net change in the fair value of hedging transactions that meet the criteria for hedging future cash flows and for which the hedged transaction has yet to be realised. The exchange

adjustment reserve in the consolidated financial statements comprises exchange differences arising on the translation of the financial statements of foreign enterprises from their functional currencies into Danish kroner including exchange differences on financial instruments considered to be a part of the net investment or as hedging of the net investment.

Treasury shares

The purchase and sale sums of treasury shares and dividends thereon are taken directly to retained earnings under equity. Proceeds from the sale of treasury shares in Schouw & Co. in connection with the exercise of share options are taken directly to equity.

Dividend

Dividend is recognised as a liability at the time of adoption by the shareholders at the annual general meeting (the date of declaration). Dividends expected to be declared in respect of the year are stated as a separate line item under equity.

Significant accounting estimates

In preparing the financial statements, management makes a number of assessments, estimates and makes assumptions necessary for calculating the carrying amount of certain assets and liabilities.

The estimates and assumptions applied are based on factors such as historical experience and other factors that management considers reasonable under the circumstances, but which are inherently uncertain and unpredictable. Such assumptions may be incomplete or inaccurate, and unexpected events or circumstances may arise. Due to the risks and uncertainties the Group is subject to, actual outcomes may deviate from estimates made. It may be necessary to revise previous estimates as a result of changes to the assumptions on which such estimates were

based or due to new information or subsequent events.

Management has identified two areas of particular materiality for the financial reporting:

Total trade receivables, amounting to DKK 4,726 million, is one of the largest balance sheet items and has had a significant effect on the income statement of BioMar in particular when viewed in terms of historical business cycles. Management reviews the need for bad debt provisions on an ongoing basis. See note 7 and page 54.
Valued at DKK 2,536 million, goodwill represents a significant amount in the balance sheet, and the value of goodwill is subject to a number of estimates in relation to purchase price allocation on acquisition and the future earnings of the underlying units. Management performs at least one impairment test annually. See note 16 and page 64.

Notes · Basis of preparation of the consolidated financial statements

Definitions of financial ratios

The financial ratios in the annual report are defined as follows:

	Profit for the year excluding minorities
Return on equity	Avg. equity excluding non-controlling interests
	EBITA
ROIC excluding goodwill	Avg. invested capital excluding goodwill
	EBITA
ROIC including goodwill	Avg. invested capital including goodwill
	Equity at year end
Equity ratio	Total liabilities and equity at year end
	Profit for the year excluding minorities
Earnings per share (EPS)	Average number of shares in circulation
	Profit for the year excluding minorities
Diluted earnings per share (EPS-D)	Diluted average number of shares in circulation
	Equity at year end excluding non-controlling interests
Net asset value per share	Number of shares at year end excluding treasury shares
	Market capitalisation, end of period
Price/net asset value (P/NAV)	Equity at year end excluding non-controlling interests
Market cap	(Number of shares excluding treasury shares) multiplied by share price

Performance measures

Schouw & Co.'s consolidated financial statements apply the following Alternative Performance Measures (APM) not defined by IFRS: EBIT, EBITA, EBITDA, working capital, net interest-bearing debt and invested capital both with and without goodwill. These Alternative Performance Measures are used in the daily Group controlling and in the communication with Group stakeholders. These alternative performance measures are calculated in the following manner:

2021	2020	Change

1,346	1,376	-2.1%
-134	-129
0	0
1,480	1,505	-1.6%
1,480	1,505
-507	-493
2	-8
-222	-202
-1	-2
2,208	2,209	-0.1%

Balance sheet ratios	2021	2020	Change
Inventories	5,514	3,692
Trade receivables	4,726	3,781
Other current receivables (non-interest bearing)	275	208
Other non-current receivables (operating)	56	25
Prepayments	71	56
Trade payables	-4,661	-3,479
Core liability	-281	-237
Other current payables (non-interest bearing)	-951	-794
Customer prepayments (current)	-111	-15
Other non-current payables (operating)	-33	-49
Prepayments (current)	-40	-81
Working capital	4,566	3,107	47.0%

Interest-bearing debt	3,453	2,599
Other non-current receivables (interest-bearing)	-170	-2
Other current receivables (interest-bearing)	-21	-26
Cash and cash equivalents	-490	-635
Net interest-bearing debt (NIBD)	2,773	1,936	43.2%
Working capital	4,566	3,107
Intangible assets	3,571	3,423
Goodwill	-2,536	-2,366
Property, plant and equipment	5,078	4,659
Lease assets	687	721
Provisions (non-current)	-31	-33
Prepayments (non-current)	-59	-63
Provisions (current)	-66	-27
Invested capital (ex. goodwill)	11,211	9,421	19.0%
Invested capital (ex. goodwill)	11,211	9,421
Goodwill	2,536	2,366
Invested capital (including goodwill)	13,747	11,787	16.6%

This section of the annual report contains notes relating to the Group's primary operations, including a breakdown by operating segments.

The following notes are presented in this section:

1 Segment reporting
2 Revenue
3 Operating expenses
4 Other operating income and expenses 5 Depreciation, amortisation and impairment losses 6 Inventories
7 Receivables (current) 8 Trade payables and other payables 9 Changes in working capital

Comments

Revenue

Consolidated revenue was up by 13.8% from DKK 21,273 million to DKK 24,219 million. Of the DKK 2,946 million growth achieved in 2021, acquired revenue accounted for DKK 343 million. Adjusted for this, organic growth in 2021 amounted to DKK 2,603 million, equal to 12.2%. All the Group's businesses contributed to the revenue growth.

The greatest contribution stemmed from BioMar, whose revenue increased by DKK 1,652 million, equivalent to 14.2%. The underlying volume growth in tonnes was 7.8%. The remainder of the improvement was due to rising raw materials prices, which were to some extent passed on to customers in the form of higher selling prices.

Fibertex Personal Care reported revenue growth of DKK 132 million, which was entirely due to rising raw materials prices in 2021, as underlying sales measured in tonnes were down by almost 3%.

Fibertex Nonwovens increased its revenue by DKK 23 million to DKK 1,814 million in 2021. The moderate revenue growth covers large fluctuations over the course of the year, with sales up 23% in the first half and down 18% in the second half.

GPV reported organic growth of DKK 304 million, equivalent to 10.5%. The revenue growth was achieved despite difficult market conditions marked by component shortages, rising raw materials prices and considerable logistics challenges. In addition to the increase in revenue, GPV in 2021 managed to increase in its order book quite significantly.

Despite challenging market conditions, HydraSpecma recorded growth of DKK 338 million, equivalent to an organic growth rate of 17.1%. The growth was partially due to higher prices of components and materials, which were to some extent passed on to customers through indexbased contracts.

At 57.2%, Borg Automotive reported the highest revenue growth rate. The acquisition of TMI at the end of 2020 and the acquisition of SBS in mid-2021 contributed DKK 343 million to the increase. Adjusted for acquisitions, Borg Automotive achieved an organic revenue growth rate of 17.7% over 2020.

Changes in revenue, 2020 to 2021

EBITDA

EBITDA fell slightly by DKK 1 million, from DKK 2,209 million in 2020 to DKK 2,208 million in 2021. This was satisfactory in light of sharply

increasing costs of raw materials, energy and freight, which impacted EBITDA by approximately DKK 150 million on, especially in the second half. The EBITDA performance covered major declines in the BioMar and Fibertex businesses, whereas GPV, HydraSpecma and Borg Automotive delivered strong EBITDA improvements.

BioMar's EBITDA was DKK 911 million, down by DKK 62 million compared with 2020. The reduction was explained by rising raw materials prices, which could not be passed on to customers entirely, and rising energy costs, which reduced 2021 earnings by approximately DKK 45 million.

Fibertex Personal Care reported an EBITDA of DKK 315 million in 2021, a DKK 90 million reduction relative to 2020. Throughout 2021, the company experienced surging raw materials prices, which could not be passed on to customers until the subsequent quarter. The effect of raw materials prices alone was assessed to have reduced EBITDA by more then DKK 80 million compared with last year.

Fibertex Nonwovens reported EBITDA of DKK 230 million, which was DKK 40 million lower than in 2020. The fall was caused by a steep decline revenue in Q4, rising raw materials prices and an increase in energy and freight costs of approximately DKK 25 million.

GPV reported a DKK 72 million, or 26.5%, improvement in EBITDA. The increase was in part attributable to a 10.5% revenue growth that contributed to efficient capacity utilisation at GPV's factories. In addition, the company was able to optimise production due to a substantial order book and increased inventories of materials.

HydraSpecma's EBITDA increased by DKK 75 million, or 35.7%. The reason was a major 17.1% increase in revenue, which improved capacity utilisation at particularly the Swedish facilities, which again contributed significantly to the higher EBITDA. Another positive contribution

was non-recurring income of DKK 17 million, mainly consisting of the proceeds from the sale of a property.

Borg Automotive reported EBITDA of DKK 162 million. This represented a DKK 53.9 million, or 49.8%, year-on-year improvement, 11.5% of which came from the acquired businesses TMI and SBS.

Changes in EBITDA, 2020 to 2021

Working capital

The Group's working capital increased significantly from DKK 3,107 million at 31 December 2020 to DKK 4,566 million at 31 December 2021. The DKK 1,459 million year-on-year increase was due to a combination of an increase in business activity, higher prices of raw materials and components and strategic decisions to build up inventories in order to maintain delivery power.

All portfolio companies reported revenue improvements, and particularly BioMar, GPV and HydraSpecma stepped up their underlying business activity and volume sales considerably. Borg Automotive not only generated more business activity, but also acquired the company SBS. The combined effect of the increased level of business activity accounts for about half of the increase in working capital.

A large part of the raw materials, materials and components used within the Group were affected by steep price increases in 2021, particularly

towards the end of the year. Higher prices of raw materials drive capital tied up in inventories higher, although this is to some extent offset by an increase in trade payables. It also leads to higher selling prices at a certain time lag and increased trade receivables. The combined effect of the higher prices accounts for about one quarter of the increase in working capital.

The rest of the increase was mainly due to a strategic choice to increase inventories of selected components and materials in GPV and HydraSpecma to maintain delivery power.

Changes in working capital, 2020 to 2021

2020 BioMar FPC FIN GPV HS Borg Other 2021

As can be seen from the chart above, all six portfolio businesses increased their working capital.

Cash flow statement

Cash flows from operations for the year before interest and tax fell from DKK 2,699 million in 2020 to DKK 989 million in 2021. The decline was due to the negative impact of a change in working capital of DKK 1,277 million in 2021, as against a positive effect of DKK 471 million in 2020. Interest payments were DKK 16 million lower in 2021, whereas tax payments were DKK 72 million higher, reducing total cash flows from operating activities to DKK 531 million, against DKK 2,296 million in 2020. As shown in the figure below, cash flows from operating activities declined in almost all portfolio companies.

Change in cash flows from operating activities, 2020 to 2021

2020 BioMar FPC FIN GPV HS Borg Other 2021

Cash flows from investments amounted to an outflow of DKK 950 million compared with DKK 533 million in 2020. Investments of close to DKK 1 billion in property plant and equipment and intangible assets were expected i 2021, but due to minor changes in the current investment projects the invested amount was only DKK 750 million in 2021. Towards the end of the year, BioMar entered into a long-term contract with a customer, who subsequently borrowed DKK 160 million for investments in an expansion of fish farming capacity. In relation to the two businesses acquired in 2021, the purchase price was conditional on the companies' future earnings, which meant that only DKK 45 million cash consideration was paid for the two acquisitions, in addition to which DKK 247 million was recognised as contingent consideration.

Cash flows from operating activities for the year amounted to DKK 531 million, of which DKK 950 million was used for investing purposes. Debt financing was increased by a net amount of DKK 588 million.

A total of DKK 336 million of the cash flows for the year was used to pay dividends to the company's shareholders in April 2021. In addition, the Group purchased treasury shares to cover the current share option programme.

Net of amounts used for investing and financing purposes, the company had a total cash outflow for 2021 of DKK 170 million, compared to a cash intflow in 2020 of DKK 133 million.

Accounting policies

Segment reporting

Segment reporting is consistent with the internal management reporting. Schouw & Co. is an industrial conglomerate consisting of a number of sub-groups operating in various industries and independently of the other sub-groups. Currently, six sub-groups are classified as independent reporting segments. The reporting segments are presented separately and without aggregation of operating segments.

Included in the reporting segments are revaluations of assets and liabilities made in connection with Schouw & Co.'s acquisition of the segment in question and consolidated goodwill arising as a result of the acquisition. The operational impact of amortisation and impairment losses on the above revaluations or goodwill is also included in the profit or loss presented for each reporting segment.

Geographical segment information indicates the group's revenue and assets by national market.

Revenue

Revenue from the sale of goods for resale and finished goods is recognised in the income statement if transfer of risk to the buyer has taken place before year-end and if the income can be reliably measured.

Although a sales agreement for the sale of finished goods and goods for resale often contains more than one performance obligation, such obligations are treated as one combined performance obligation because delivery typically takes place at one point in time.

The sale of services mainly consists of Fibertex Personal Care's print business. Print services typically involve a delivery obligation recognised in revenue on a straight-line basis during the period the service is provided.

The terms of payment set out in the Group's sales agreements with customers depend on the underlying performance obligation and on the underlying customer relationship. For the sale of goods for which control passes at a specific point in time, the terms of payment will typically be from one to three months.

Revenue also comprises the market value of cores and adjustments of the provision for cores in connection with the sale of remanufactured automotive parts by the Borg Automotive group.

Revenue is measured excluding VAT and other taxes and duties charged on behalf of third parties. All discounts granted are deducted from revenue.

Operating expenses

Operating expenses comprise costs incurred for the manufacture and sale of goods, primarily cost of sales, consumables, energy consumption and transportation of goods. Operating expenses furthermore comprise wages and salaries and expenses for the company's administration and management. Also recognised in operating expenses are estimated changes in the value of inventories and changes in bad debt provisions as well as product development and research costs.

Employee benefits

Wage compensation received in connection with the coronavirus situation has been offset in wages and salaries under operating expenses.

Equity-settled share options are measured at fair value at the grant date and their value is recognised in the income statement under staff

Consolidated statements Consolidated statements

costs over the vesting period. The balancing item is recognised directly in equity as a shareholder transaction.

On initial recognition of the share options, the number of options expected to vest is estimated. Subsequently, changes in the estimated number of vested options are adjusted to the effect that the total amount recognised is based on the actual number of vested options.

The fair value of options granted is estimated using a valuation model that takes into account the terms and conditions of the options granted.

Costs relating to the option programme are calculated on the basis of the Black & Scholes model and are expensed under staff costs on a straight-line basis over the vesting period.

Other operating income and expenses

Other operating income and costs comprise items secondary to the primary activities of the enterprises and consists of the following:

Gains or losses on the disposal of intangible assets, property plant and equipment and leased assets.
Government grants include grants and funding of development work and grants for investments, etc. Grants for research and development costs recognised directly in the income statement are included in other operating income.

Investment grants in the form of certain tax-privileged schemes in individual countries are recognised in the balance sheet under receivables and as deferred income under liabilities. Grants are recognised in the income statement under other operating income as the underlying investments are depreciated. The receivable is reduced as the grant is received and the deferred income item is reduced as the grant is recognised in the income statement.

Amounts in DKK million

Depreciation, amortisation and impairment losses

The item comprises depreciation and impairment of property, plant and equipment and lease assets and amortisation and impairment of intangible assets.

Inventories

Inventories are measured at cost in accordance with the FIFO method. Where the net realisable value is lower than cost, inventories are written down to this lower value. The cost of goods for resale, raw materials and consumables comprises the purchase price plus delivery costs. The cost of finished goods and work in progress comprises the cost of raw materials, consumables, direct labour and indirect production costs. Indirect costs of production include indirect materials and labour as well as maintenance of and depreciation and impairment of the machines, factory buildings and equipment used in the manufacturing process as well as factory management and administrative expenses. The net realisable value of inventories is calculated as the selling price less costs of conversion and costs incurred to execute the sale and is determined having regard to marketability, obsolescence and expected selling price movements.

Biological inventories are recognised at fair value less estimated selling costs.

Receivables

Receivables are measured at amortised cost. Provisions for bad debts are made in accordance with the simplified expected credit loss-model, under which total losses are recognised immediately in the income statement at the same time as the receivable is recognised in the balance sheet in the amount of the lifetime expected credit loss on the receivable. Impairment write-downs on receivables are recognised in the income statement under operating expenses.

Prepayments

Prepayments include expenses paid in respect of subsequent financial years. Deferred income comprises payments received relating to income in subsequent financial years, including investment grants.

Other payables

Other payables comprise core liabilities where the company has an obligation to repurchase cores for refabrication of automotive spare parts.

Cash flow statement

The cash flow statement shows the cash flows for the year distributed on operating, investing and financing activities, net changes for the year in cash as well as cash and cash equivalents at the beginning and end of the year.

The cash effect of acquisitions and divestments is shown separately under cash flows from investing activities. In the cash flow statement, cash flows concerning acquired companies are recognised from the date of acquisition, while cash flows concerning divested companies are recognised until the date of divestment.

Cash flows in currencies other than the functional currency are translated at average exchange rates unless these differ materially from the exchange rate ruling at the transaction day.

Cash flows from operating activities are calculated according to the indirect method as EBITDA adjusted for non-cash operating items, changes in working capital, interest paid and income taxes paid.

Cash flows from investing activities comprise payments made in connection with the acquisition and divestment of companies and operations and the purchase and sale of intangible assets, property, plant and equipment and other noncurrent assets, including loans to customers, as well as the purchase and sale of securities not

recognised under cash and cash equivalents. Dividends from associates are included in cash flows from investing activities.

Cash flows from financing activities include payments to and from shareholders and related expenses as well as the raising of loans, repayments on interest-bearing debt, including lease debt, and the purchase and sale of treasury shares.

Cash and cash equivalents include cash at bank and in hand as well as securities with a maturity of less than three months at the time of acquisition that can immediately be converted into cash and that involve insignificant risk of value fluctuations.

Accounting estimates

Trade receivables

Trade receivables are considered a significant accounting estimate.

Management applies estimates in the assessment of the likelihood that receivables at the balance sheet date will be received. For the Schouw & Co. Group, the largest risks of losses on trade receivables have historically related to customers of BioMar. BioMar sells a significant part of its products in markets in South America (Chile), and in southern and central Europe. Historically, the largest debtor risks have been for customers in Chile and in southern Europe, especially Greece. The Group has substantial receivables with certain customers in these geographical areas. Thorough analyses have been made of the credit quality of these debtors, and management believes that adequate provisions for losses on these debtors had been made at 31 December 2021.

The other companies are not believed to involve material credit risks. See note 7.

Consolidated statements

Inventories

The uncertainty involved in estimating inventories is related to the assessment of obsolescence and lack of marketability. Goods considered to be obsolete or to have impaired marketability are written down to net realisable value. As the Schouw & Co. Group consists of companies of a diverse nature, the process of estimating net realisable value of inventories varies from company to company.

The uncertainty involved in estimating inventories for the Schouw & Co. Group is predominantly related to the Group's companies GPV, HydraSpecma and Borg Automotive.

GPV generally produces to order and its inventories predominantly consist of electronics components and metal sourced and/or manufactured to meet customer needs. For its component inventory, GPV applies a general model of writing down goods after they have been in stock for a certain period of time. The company reviews its impairment model on a regular basis, and in

the Group's best estimate, the model provides an appropriate and fair presentation of the net realisable value of inventories.

Hydra-Specma applies a general impairment model of automatically writing down goods after they have been in stock for a certain period of time. The company reviews its impairment model on a regular basis, and in the Group's best estimate, the model provides an appropriate and fair presentation of the net realisable value of inventories.

Borg Automotive remanufactures used components – called cores - such as alternators, starters, brake callipers, etc. When a remanufactured component is sold, Borg also takes a deposit which gives the customer the right to return a similar core.

Borg Automotive has an obligation to accept the returned core, and eventually the market for the type of cores in question will shrink, and Borg Automotive will be left with unusable cores. As

a result, Borg Automotive has relatively large impairment losses on the part of its inventory relating to cores.

The company applies an impairment model which is based on expected future sales. In the Group's best estimate, the model provides an appropriate and fair presentation of the net realisable value of inventories.

Inventories, end of year by portfolio company

Management's report

Management's report Management's report

1 Segment reporting

Reporting segments 2021	BioMar	Fibertex Personal Care	Fibertex Nonwovens	GPV	Hydra- Specma	Borg Automotive	Reporting segments	Parent company	Group eliminations, etc.	Total
External revenue	13,300	2,230	1,814	3,191	2,315	1,368	24,219	0	0	24,219
Intra-group revenue	0	19	0	0	0	0	19	11	-30	0
Segment revenue	13,300	2,249	1,814	3,191	2,315	1,368	24,238	11	-30	24,219
EBITDA	911	315	230	342	286	162	2,247	-39	0	2,208
Depreciation, amortisation and impairment losses	352	133	100	111	95	69	860	1	0	861
EBIT	559	182	130	231	191	93	1,387	-40	0	1,346
Share of profit in associates and JVs	45	0	0	0	1	0	46	0	0	46
Tax on profit/loss for the year	-146	-43	-20	-21	-40	-20	-289	-4	0	-293
Profit for the year	400	129	90	196	143	57	1,015	24	0	1,039
Segment assets:	10,455	2,240	2,115	3,179	1,966	2,198	22,153	13,044	-13,673	21,524
Of which goodwill	1,478	99	119	181	143	516	2,536	0	0	2,536
Equity investments in associates and JVs	549	0	0	0	9	0	559	0	0	559
Segment liabilities	7,089	1,063	1,338	2,022	1,273	1,144	13,929	2,374	-5,464	10,839
Working capital	1,399	397	515	1,150	772	341	4,575	-8	0	4,566
Net interest-bearing debt	1,932	579	954	824	715	138	5,142	-2,369	0	2,773
Cash flows from operating activities	249	116	127	-126	75	48	491	18	22	531
Capital expenditure	157	203	233	73	62	15	744	1	0	745
Acquisitions (divestments)	39	0	0	0	0	6	45	-1	0	44
Average no. of employees	1,445	777	1,055	3,878	1,192	1,848	10,195	15	0	10,210

Based on management control and financial management, Schouw & Co. has identified six reporting segments, which are BioMar, Fibertex Personal Care, Fibertex Nonwovens, GPV, HydraSpecma and Borg Automotive. Management primarily evaluates reporting segments based on the performance measures EBITDA and EBIT but also regularly considers the segments' cash flows from operations and working capital. All inter-segment transactions were made on an arm's length basis.

Capex is defined as the net cash flow for the year for investment in property plant and equipment and intangible assets. Acquisitions are defined as cash flows for the year from investment in acquisition and divestment of enterprises, including associates and joint ventures, and capital increases.

The data on revenue by geography are based on customers' geographical location, while data on property, plant and equipment and lease assets by geography are based the geographical location of the assets. The specification shows individual countries that account for more than 5% of the Group in terms of revenue or assets. As Schouw & Co.'s consolidated revenue is generated in some 100 different countries, a very large proportion of revenue derives from the 'Other' category. Intangible assets are not classified by geography, as the value of neither customers nor goodwill can be precisely allocated to specific countries.

Management's report Management's report

Segment reporting (continued)

	22%		19%
49%	2021 12%	49%	2020
	7% 6% 5%		6% 5%	7%

Revenue by country

19%	Norway	5,442	3,958
	Chile	2,841	3,008
	Denmark	1,622	1,394
14%	UK	1,335	1,374
7%	Germany	1,147	1,028
	Other	11,833	10,511
	Total	24,219	21,273

2021 2020

Property, plant and equipment and lease assets by country

2020

16% 15%

	2021	2020
Malaysia	946	822
Denmark	804	873
Norway	788	809
USA	541	395
Czech Republic	392	323
Chile	332	319
Australia	318	318
Other	1,645	1,522
Total	5,765	5,381

Reporting segments 2020	BioMar	Fibertex Personal Care	Fibertex Nonwovens	GPV	Hydra- Specma	Borg Automotive	Reporting segments	Non reporting segments	Parent company	Group eliminations, etc.	Total

External revenue	11,649	2,097	1,791	2,887	1,977	871	21,272	1	0	0	21,273
Intra-group revenue	0	20	0	0	0	0	20	0	11	-31	0
Segment revenue	11,649	2,118	1,791	2,887	1,977	871	21,292	1	11	-31	21,273
EBITDA	972	406	270	271	211	108	2,238	1	-30	0	2,209
Depreciation, amortisation and impairment losses	335	137	104	120	88	48	832	1	1	0	833
EBIT	637	269	166	151	123	60	1,406	1	-31	0	1,376
Share of profit in associates and JVs	-36	0	0	0	0	0	-36	0	0	0	-36
Tax on profit/loss for the year	-141	-57	-46	-18	-20	-13	-295	0	-5	0	-300
Profit for the year	393	197	88	101	62	44	884	0	24	0	909
Segment assets:	8,931	1,917	1,986	2,317	1,724	1,575	18,450	11	11,323	-11,789	17,994
Of which goodwill	1,317	99	116	174	144	516	2,366	0	0	0	2,366
Equity investments in associates and JVs	473	0	0	0	8	0	481	0	0	0	481
Segment liabilities	5,845	764	1,304	1,418	1,150	516	10,997	5	1,717	-4,330	8,389
Working capital	955	250	472	701	621	113	3,112	0	-5	0	3,107
Net interest-bearing debt	1,532	327	826	615	696	1	3,997	3	-2,064	0	1,936
Cash flows from operating activities	1,028	423	225	252	197	139	2,266	1	13	15	2,296
Capital expenditure	152	93	92	32	113	11	493	0	0	0	493
Acquisitions	0	0	0	0	0	60	61	0	0	0	61
Average no. of employees	1,377	745	1,019	3,611	1,161	1,466	9,379	0	14	0	9,393

Management's report Management's report

2
Revenue

	2021	2020

Sale of goods	23,690	20,785
Disposal of biological assets	196	128
Sale of services	329	357
Royalties	4	2
Rental income	0	2
Total revenue	24,219	21,273

The sale of biological assets relates to BioMar's sale of fish from the LetSea research centre The sale of services relates to Fibertex Personal Care's sale of print services.

Revenue by subsidiary

3 Operating expenses

-404 -694 -105 -826 -22,044	-320 -574 -99 -722 -19,074




-230	-213
-2,610	-2,306
-17,177	-14,839

2021 2020

	2021	2020
Staff costs are specified as follows:
Remuneration to the Board of Directors of Schouw & Co.	-4	-4
Wages and salaries	-2,183	-1,939
Defined contribution pension plans	-120	-113
Defined benefit pension plans	-19	-15
Other social security costs	-261	-220
Share-based payment	-27	-19
Total staff costs	-2,613	-2,309
Of which capitalised under non-current assets	4	4
Staff costs recognised in the income statement	-2,610	-2,306
Average no. of employees	10,210	9,393

Staff costs include wage compensation for a total of DKK 2 million (2020: DKK 37 million) received mainly in Germany and Austria in connection with the temporary closure and furloughing of employees as a result of the coronavirus situation in 2021.

Key members of management are defined as the Executive Management.

Determination of remuneration to the Board of Directors and the Executive Management

Aktieselskabet Schouw & Co. has prepared a remuneration policy describing guidelines for the remuneration to members of the company's Board of Directors and Executive Management. A remuneration report has been prepared for 2021, describing remuneration to members of the company's Board of Directors and Executive Management. The remuneration policy and the Remuneration Report are available from the company's website.

The remuneration to board members consists of a fixed basic fee, which in 2021 amounted to DKK 325,000. It is proposed to raise the basic fee for 2022 to DKK 400,000. The total fee to the Board of Directors amounted to DKK 4.3 million (2020: DKK 4.3 million). Remuneration to the Board of Directors includes a fee for serving on committees of DKK 0.7 million (2020: DKK 0.7 million) and fees from subsidiaries of DKK 0.8 million (2020: DKK 0.8 million).

The Executive Management of Schouw & Co. received total remuneration of DKK 20.7 million (2020: DKK 17.1 million). Jens Bjerg Sørensen received total remuneration of DKK 15.2 million (2020: DKK 12.5 million), of which share-based payment amounted to DKK 2.6 million (2020: DKK 2.3 million). Peter Kjær received total remuneration of DKK 5.4 million (2020: DKK 4.6 million), of which sharebased payment amounted to DKK 0.9 million (2020: DKK 0.8 million).

Management's report Management's report

3 Operating expenses (continued)

Share-based payment: Share option programme

The company maintains an incentive programme for the Executive Management and senior managers, including the executive managements of subsidiaries. The programme entitles participants to acquire shares in Schouw & Co. at a price based on the officially quoted price at around the date of grant (2021: DKK 666.40) plus a premium (2021: 2.00%) from the date of grant until the date of exercise. The exercise price is adjusted by deduction of ordinary dividends, which cannot exceed the accrued interest. Costs relating to the option programme are calculated on the basis of the Black & Scholes model and are expensed under staff costs on a straight-line basis over the vesting period. The 2021 grant is described in more detail in company announcement no. 2/2021 of 12 March 2021.

Outstanding options	Executive man agement	Other	Total
Granted in 2017	55,000	212,000	267,000
Granted in 2018	55,000	263,000	318,000
Granted in 2019	47,000	265,000	312,000
Granted in 2020	60,000	310,000	370,000
Total outstanding options at 31 December 2020	217,000	1,050,000	1,267,000
Granted in 2021	40,000	363,000	403,000
Lapsed (from 2017 grant)	-55,000	-212,000	-267,000
Total outstanding options at 31 December 2021	202,000	1,201,000	1,403,000

Outstanding options exercisable at 31 December 2021.	55,000	263,000	318,000

No options were exercised in 2021.

The expected volatility is calculated as 12 months' historical volatility based on average prices. If the option holders have not exercised their share options within the period specified, the share options will lapse without any compensation to the holders. Exercise of the share options is subject to the holders being in continuing employment during the above-mentioned periods. If the share option holder leaves the company's employ before a share option vests, the holder may in some cases have a right to exercise the share options early during a four-week period following Schouw & Co.'s next following profit announcement. In the event of early exercise, the number of share options will be reduced proportionately.

The following assumptions were applied in calculating the fair value of outstanding share options at the date of grant:

Fair value assumptions	2021 grants	2020 grants	2019 grants	2018 grants
Expected volatility	31.60%	22.21%	29.23%	21.10%
Expected term	49 mo.	48 mo.	48 mo.	48 mo.
Expected dividend per share	DKK 14	DKK 13	DKK 13	DKK 12
Risk-free interest rate	-0.54%	-0.97%	-0.52%	-0.38%
Other information on option programmes:
Exercise price (DKK) *	678.19	523.42	574.35	705.58
Fair value (DKK) per option **	125.37	44.1	71.47	58.51
Total fair value in DKKm	50.5	16.3	23.3	20.1
Exercisable from	March 2024	March 2023	March 2022	March 2021
Exercisable until	April 2025	March 2024	March 2023	March 2022

*) On exercise after four years (at the latest possible date)

**) At the date of grant

4

Other operating income and expenses

	2021	2020

Gains on the disposal of property, plant and equipment and intangible assets	16	5
Government grants	14	15
Other operating income	9	7
Total other operating income	39	27
Loss on the disposal of property, plant and equipment and intangible assets	-2	-3
Other operating expenses	-4	-14
Total other operating expenses	-6	-17

Fibertex Personal Care recognised a DKK 7.5 million investment grant received in Malaysia under government grants in 2021. The grant is primarily subject to Fibertex Personal Care Malaysia continuing to generate a taxable profit over the coming years, which is considered very likely.

In 2021, BioMar received a DKK 4.7 million grant in connection with the establishment of production in Australia.

BioMar FPC FIN GPV HS Borg Group

Notes · EBITDA, working capital and cash flows

5

Depreciation, amortisation and impairment losses

	2021	2020
Depreciation and impairment losses
Amortisation of intangible assets	-134	-129
Depreciation of property, plant and equipment	-507	-493
Impairment / reversed impairment of property, plant and equipment	2	-8
Depreciation of lease assets	-222	-202
Lease assets written off	-1	-2
Total depreciation, amortisation and impairment losses	-861	-833

2020

6 Inventories

	2021	2020

Raw materials and consumables	3,378	2,301
Work in progress	297	174
Finished goods and goods for resale	1,753	1,177
Biological assets (fish)	86	40
Total inventories	5,514	3,692
Cost of inventories for which impairment losses have been recognised	724	534
Accumulated impairment losses on inventories	-282	-254
Net sales value	442	280

BioMar FPC FIN GPV HS Borg Group

The group's biological assets consist exclusively of fish used for fish feed experiments.

Management's report Management's report

7

Receivables (current)
	2021	2020
Trade receivables	4,726	3,781
Other current receivables	296	234
Total current receivables	5,022	4,015

	Not	Due between (days)
2021	fallen due	1-30	31-90	>91	Total
Trade receivables	4,037	401	174	278	4,889
Impairment losses on trade receivables	-32	-4	-4	-124	-163
Trade receivables, net	4,005	397	170	154	4,726
Proportion of total receivables expected to be settled					96.7%
Impairment rate	0.8%	1.0%	2.2%	44.6%	3.3%

Trade receivables by portfolio company:

	Not	Due between (days)
2020	fallen due	1-30	31-90	>91	Total
Trade receivables	3,096	377	183	268	3,924
Impairment losses on trade receivables	-22	-4	-4	-112	-142
Trade receivables, net	3,074	373	179	156	3,781
Proportion of total receivables expected to be settled					96.4%
Impairment rate	0.7%	1.1%	2.1%	41.8%	3.6%

	2021	2020
Impairment losses on trade receivables
Impairment losses, beginning of period	-142	-171
Foreign exchange adjustments	-4	8
Additions on company acquisitions	-7	0
Reversed impairment losses	0	0
Impairment losses for the year	-11	-15
Realised loss	1	36
Impairment losses, end of period	-163	-142

8

Trade payables and other payables	2021	2020

Trade payables	4,661	3,479
Core liability	211	178
Other current payables	951	794
Other current payables (non-operating)	8	0
Provisions	66	27
Total trade payables and other payables	5,895	4,478

Trade payables and other payables all fall due in all material respects within one year. Extended government deadlines for paying employee income taxes, etc. intended to support company liquidity had an overall effect of DKK 104 million at 31 December 2021 (2020: DKK 62 million). The amount is recognised under other payables, DKK 71 million under current payables and DKK 33 million under non-current payables.

For a number of years, BioMar has facilitated a supply chain financing programme (reverse factoring) through banks. The purpose of the programme is to develop and ensure long-term relations with strategically important suppliers of raw materials. The supply chain finance programme contributes to ensuring low raw materials prices and financing costs in the value chain. Suppliers participating in the programme have the option of receiving early payment once BioMar has approved a delivery. Under the system, BioMar assigns approved invoices to the bank in a factoring arrangement without recourse. The bank then pays the supplier early while ensuring the best possible credit period for BioMar. Supply chain finance debt of DKK 1,058 million is recognised in the balance sheet under trade payables (2020: DKK 829 million).

Borg Automotive sells remanufactured automotive spare parts charging a deposit for a product's core component. The system of deposits give the customers an incentive to return the cores, ensuring a flow of raw materials to the company. This produces a core liability that applies for two years. The liability amounted to DKK 281 million at 31 December 2021 (2020: DKK 237 million). Of this amount, DKK 211 million (2020: DKK 178 million) is recognised as current liabilities, while the rest is recognised as other non-current liabilities.

9

Changes in working capital, effect on cash flows	2021	2020

Change in inventories	-1,614	16
Change in receivables	-871	-146
Change in trade payables and other payables	1,208	601
Total changes in working capital	-1,277	471

7

Receivables – current (continued)

The principal risk in terms of anticipated bad debts in the Schouw & Co. Group relates to BioMar. DKK 125 million of the total of DKK 163 million in bad debt provisions at 31 December 2021 was related to BioMar, and the following estimates have been made for the current risk of loss:

			Due between (days)
2021	Not fallen due	1-30	31-90	>91	Total
High risk of loss	9	1	2	50	62
Medium risk of loss	17	2	1	41	61
Low risk of loss	1	0	1	0	2
Total provision made by BioMar	27	3	4	91	125
Trade receivables in BioMar	2,469	155	121	226	2,971

			Due between (days)
2020	Not fallen due	1-30	31-90	>91	Total
High risk of loss	8	1	2	52	63
Medium risk of loss	9	1	1	45	56
Low risk of loss	1	0	0	1	3
Total provision made in BioMar	19	2	3	98	122

Trade receivables in BioMar	1,861	193	132	237	2,422

The risk assessment is based on a combination of country risk and market risk as well as a companyspecific risk assessment. Low-risk markets are mainly Norway and Scotland, while high-risk markets are mainly Greece, Russia, Ecuador and Costa Rica. Medium-risk markets consist of Chile, Denmark, France, Spain and Australia.

BioMar has taken out credit insurance for DKK 1,230 million for its trade receivables (2020: DKK 1,133 million). In addition, customers have provided collateral to BioMar in the amount of DKK 243 million (2020: DKK 203 million). The collateral provided consists mainly of assets such as fish stocks and fish farming equipment.

The Group's portfolio companies closely monitor trade receivables in order to estimate the need to make provisions for bad debts. Provisions for bad debts are determined on the basis of a general impairment model and an individual assessment of the debtor's expected ability to pay with due consideration for any collateral provided by the customer plus any debtor insurance. At Group level, a debtor report is prepared quarterly and submitted to Schouw & Co.'s Board of Directors.

This section of the annual report contains notes relating to the Group's invested capital.

The following notes are presented in this section:

10 Intangible assets 11 Property, plant and equipment 12 Lease assets 13 Investments in subsidiaries, associates and joint arrangements 14 Receivables – non-current 15 Acquisitions 16 Impairment test

Comments

Invested capital

In 2021, invested capital exclusive of goodwill increased by DKK 1,790 million or 19% to DKK 11,211 at the end of the year.

Changes in invested capital 2020-2021

As can be seen from the chart, invested capital increased in all businesses with the exception of the parent company. The largest increases in invested capital were seen in BioMar and GPV, primarily due to a significant increase in working capital. The largest relative increase in invested capital was seen in Borg Automotive with a 49% increase in invested capital, which was partly due to the acquisition of SBS.

ROIC

Return on invested capital (ROIC) is measured as Operating profit/loss before amortisation of intangible assets (EBITA) as a percentage of average invested capital. ROIC exclusive of goodwill fell to 14.1% in 2021 from 15.3% in 2020.

The reason for the lower ROIC was a 7% increase in average invested capital exclusive of goodwill in 2021, whereas EBITA fell by 2%.

Avg. invested capital excluding goodwill

ROIC excluding goodwill

ROIC including goodwill

Accounting policies

Intangible assets

Goodwill is initially measured in the balance sheet at cost. Subsequently, goodwill is measured at cost less accumulated impairment. Goodwill is not amortised. The carrying amount of goodwill is allocated to the Group's cashgenerating units at the date of acquisition. The determination of cash-generating units is based on the management structure and the in-house financial management.

Intangible assets such as customer relations, brands and technology, acquired in connection with business combinations are measured at cost less accumulated amortisation and impairment. Other intangible assets comprise IT solutions and development projects. Intangible assets are amortised on a straight-line basis over the expected useful lives of the assets, which are as follows:

Customer relations	7-20 years
Brands	10-20 years
Technology	5-15 years
Other intangible assets	3-10 years	equipment
Goodwill is not amortised, but is tested for impairment once a year.

Property, plant and equipment

Land and buildings, plant and machinery, fixtures and fittings, tools and equipment are measured at cost less accumulated depreciation and impairment.

Cost comprises the purchase price and any costs directly attributable to the acquisition until the date when the asset is ready for use. For assets produced in-house, cost comprises direct and indirect costs of materials, components, thirdparty suppliers and labour. Cost is increased by the present value of estimated liabilities for the removal and disposal of the asset and restoration of the site on which the asset was used. The cost of a total asset is divided into separate components that are depreciated separately if such components have different useful lives.

Interest expense of constructing a new asset and incurred during the construction period is recognised in the cost of the asset.

Subsequent costs, such as the cost of replacing components of property, plant and equipment, are included in the asset's carrying amount. The replaced components are no longer recognised in the balance sheet, and the carrying amount is transferred to the income statement. All other ordinary repair and maintenance costs are recognised in the income statement when incurred. Property, plant and equipment are depreciated on a straight-line basis over the expected useful lives of the assets/components, which are expected to be as follows:

Buildings	10-50 years
Production equipment etc.	4-15 years
Other fixtures and fittings, tools and	3-10 years
equipment
Land	not depreciated

The basis of depreciation is calculated with due consideration to the asset's scrap value, reduced by any impairment losses. The residual value is determined at the acquisition date and reassessed annually. Where the residual value exceeds the carrying amount, the property ceases to be depreciated.

If the depreciation period or the scrap value is changed, the effect on depreciation going forward is recognised as a change in accounting estimates.

Depreciation is recognised in the income statement in the line item depreciation and amortisation.

Leases

Leases are recognised in the balance sheet as a lease asset (right of use of the lease) and a lease liability. However, leases and lease agreements for minor assets and short-term agreements (of less than one year) are exempt from the recognition requirement. Lease assets are depreciated on a straight-line basis over their expected useful lives, and rent and lease payments are broken down into a principal component reducing the lease debt and an interest component recognised in financial expenses.

Lease assets are depreciated on a straight-line basis over the expected term, which is as follows:

Ships	Up to 15 years
Property	3-10 years
Other assets	Up to 5 years

Many of the property leases have extension options, which are recognised in the lease asset if the Group reasonably expects to exercise the option. Other assets mainly consist of cars, trucks and other production equipment.

The lease liability is calculated as the present value of future lease payments and discounted using the internal rate of return of the lease or an alternative borrowing rate.

Service elements included in the lease are not included in the lease liability, but are disclosed separately.

For purposes of assessing expected lease terms, the Group identifies the non-cancellable lease term of the agreement plus periods comprised by an extension option which management reasonably expects to exercise.

Investments in joint ventures and associates Joint ventures and associates are recognised in consolidated income statement at the proportionate share of the profit or loss after elimination of the proportionate share of intra-group gains or losses after impairment of goodwill.

Investments in joint ventures and associates are measured in the balance sheet at the proportionate share of the companies' net asset value calculated in accordance with the Group's accounting policies with the deduction or addition of the proportionate share of unrealised intra-group gains and losses and with the addition of the carrying amount of goodwill.

Associates with a negative equity value are recognised at zero.

Receivables from associates are written down to the extent they are deemed to be irrecoverable.

Business combinations.

Newly acquired or newly established companies are recognised in the consolidated financial statements from the date of acquisition. Comparative figures are not adjusted to reflect acquisitions.

The purchase method is applied on acquisitions if the Parent Company gains control of the company acquired. Assets, liabilities and contingent liabilities in companies acquired are measured at their fair value at the date of acquisition. Intangible assets are recognised if they can be separated or if they arise from a contractual right and the fair value can be reliably measured. Deferred tax on revaluations made is recognised.

Any excess of the consideration paid for the business over the fair value of the acquired assets, liabilities and contingent liabilities is recognised as goodwill under intangible assets. In the event of uncertainty regarding measurement, goodwill may be adjusted until 12 months after the acquisition. Goodwill is not amortised, but is tested for impairment annually. The first impairment test is performed before the end of the year of acquisition. On acquisition, goodwill is transferred to the cash-generating units that will subsequently form the basis for future impairment tests.

On initial recognition, non-controlling interests are either recognised at their fair value or at their pro-rata share of the fair value of the acquired company's identifiable assets, liabilities and contingent liabilities. Accordingly, for the former option, goodwill is recognised relating to noncontrolling interests of the acquired business, while for the latter option, goodwill relating to non-controlling interests is not recognised. The measurement of non-controlling interests is determined on a case-by-case basis and disclosed in the presentation of acquired businesses in the notes to the financial statements.

When put options are issued as part of the consideration for business combinations, the put options received by non-controlling interests are considered to have been redeemed on the acquisition date.

The non-controlling interest is reversed and a liability is recognised at fair value on initial recognition, and the difference is adjusted under equity. Fair value is determined as the present value of the exercise price of the option. The option is subsequently measured at amortised cost corresponding to the discounted value of the expected future cash flows. Value adjustments are recognised directly in equity. Dividend payments agreed in relation to the put option are considered a financial expense and recognised in the income statement. For more information on put options, including significant accounting estimates, see page 83.

Contingent consideration agreed in connection with company acquisitions and paid to the seller if certain conditions are met, are recognised at fair value and considered part of the total consideration for acquiring the company. Changes in fair value of the contingent consideration are recognised in the income statement.

Company divestments

Companies divested or wound up are consolidated in the income statement until the date they are divested or wound up. Comparative figures are not adjusted to reflect divestments.

Any gains or losses on the disposal of subsidiaries, associates or joint ventures are stated as the difference between the sales sum or the proceeds from the winding-up and the carrying amount of net assets, including goodwill, at the date of disposal and expenses for selling or winding-up. On the disposal of subsidiaries, adjustments accumulated in equity through other comprehensive income and which are attributable to the unit are reclassified to the income statement and recognised together with any gains or losses from the disposal.

On the divestment of a subsidiary, the profit/loss is recognised under profit/loss from the divestment of equity investments if the company sold does not represent an independent reporting segment or if its revenue, profit/loss or assets represent less than 10% of consolidated revenue, consolidated profit/loss or consolidated assets.

Profit from the sale of other subsidiaries is recognised in profit from discontinued operations.

Gains on the sale of associates and joint ventures are recognised in Gains on equity divestments.

Non-current asset impairment test

Goodwill and intangible assets with indefinite useful lives are tested annually for impairment, initially before the end of the year of acquisition. Development projects in progress are also tested for impairment annually.

The carrying amount of goodwill is tested for impairment together with the other non-current assets of the cash-generating unit to which goodwill has been allocated and is written down over the income statement to the lower of the recoverable amount and the carrying amount.

The recoverable amount is generally calculated as the present value of the future net cash flows expected to be derived from the business or activity (cash-generating unit) to which the goodwill relates.

A write-down is recognised when the carrying amount of an asset or a cash-generating unit exceeds the recoverable amount of the asset or the cash-generating unit. Impairment write-downs are recognised in the income statement in the line item depreciation, amortisation and impairment losses. However, goodwill write-downs are recognised as a separate item in the income statement. Impairment write-downs of goodwill

are not reversed. Impairment of other assets is reversed to the extent changes have occurred to the assumptions and estimates leading to the impairment. Impairment is only reversed to the extent the new carrying amount of an asset does not exceed the carrying amount the asset would have had net of depreciation, had the asset not been impaired.

The carrying amounts of other non-current assets are tested annually to determine whether there is any indication of impairment. If such an indication exists, the recoverable amount of the asset is calculated. The recoverable amount is the higher of the fair value of the asset less expected costs to sell and the value in use.

Significant accounting estimates

Acquisitions

In connection with the acquisitions of Viet-Uc and SBS, a number of estimates were made of the acquired assets and liabilities, including primarily the value of customers and the value of technology. The valuation of these intangible assets are subject to a number of assumptions based on estimates. Due to the amount of the transactions, however, these estimates are of minor importance to the Group than has been the case with previous acquisitions.

Impairment test

Goodwill is tested annually for impairment, and other intangible assets are tested if there is evidence of impairment.

An assessment is made as to whether the cashgenerating unit to which the asset relates will be able to generate sufficient cash flows in future to support the carrying amount of the asset.

Assessments are made of the estimated cash flows for the next many years and of the longterm growth rate and a reasonable discount rate reflecting the risk inherent to the asset or cashgenerating unit, all of which is inherently subject to uncertainty. See note 16.

Useful lives

Estimated useful lives of intangible assets, property, plant and equipment and lease assets which are depreciated are reviewed regularly.

10

Intangible assets

		Customer		Tech	Other intangible
2021	Goodwill	relations	Brands	nology	assets	Total
Cost at 1 January 2021	2,367	690	198	429	291	3,976
Foreign exchange adjustments	84	20	1	20	5	131
Addition on internally generated assets	0	0	0	0	0	0
Addition through separate acquisition	0	0	0	0	49	49
Additions on company acquisitions	86	0	36	0	0	121
Disposals	0	0	0	0	-1	-1
Transferred/reclassified	0	0	0	0	11	11
Cost at 31 December 2021	2,537	710	234	450	356	4,287
Amortisation and impairment at 1 January 2021	-2	-208	-55	-101	-188	-553
Foreign exchange adjustments	0	-7	0	-5	-5	-17
Transferred/reclassified	0	0	0	0	-13	-13
Impairment	0	0	0	0	0	0
Amortisation	0	-49	-19	-31	-35	-134
Amortisation and impairment of assets disposed	0	0	0	0	1	1
Amortisation and impairment at 31 Dec. 2021	-1	-264	-73	-137	-240	-716
Carrying amount at 31 December 2021	2,536	447	161	312	116	3,571

The Group had additions of intangible assets in 2021 in connection with the acquisition of Viet-Uc and SBS.

At the end of 2021, the Group had entered into contracts for the purchase of intangible assets for an amount of DKK 18 million (2020: DKK 37 million).

The category other intangible assets consists mainly of IT projects, but also includes various ongoing and completed development projects.

					Other
2020	Goodwill	Customer relations	Brands	Tech- nology	intangible assets	Total
Cost at 1 January 2020	2,452	687	198	423	245	4,006
Foreign exchange adjustments	-85	-19	0	-21	-3	-129
Addition on internally generated assets	0	0	0	0	7	7
Addition through separate acquisition	0	0	0	0	41	41
Additions on company acquisitions	0	22	0	27	0	49
Disposals	0	0	0	0	-1	-1
Transferred/reclassified	0	0	0	0	2	2
Cost at 31 December 2020	2,367	690	198	429	291	3,976
Amortisation and impairment at 1 January 2020	-2	-168	-41	-76	-151	-438
Foreign exchange adjustments	0	8	-1	4	3	15
Transferred/reclassified	0	0	0	0	0	0
Impairment	0	0	0	0	0	0
Amortisation	0	-48	-13	-29	-39	-129
Amortisation and impairment of assets disposed	0	0	0	0	0	0
Amortisation and impairment at 31 Dec. 2020	-2	-208	-55	-101	-188	-553
Carrying amount at 31 December 2020	2,366	482	143	328	104	3,423

11

Property, plant and equipment

2021	Land and buildings	Plant and machinery	Other fixtures and fittings, tools and equipment	Assets under con struction	Total
Cost at 1 January 2021	2,932	5,777	431	270	9,410
Foreign exchange adjustments	104	183	9	11	307
Additions	44	167	37	516	763
Additions on company acquisitions	44	12	4	0	60
Disposals on divestment	-22	0	0	0	-22
Disposals	-38	-10	-12	-10	-70
Transferred/reclassified	143	36	-9	-183	-13
Cost at 31 December 2021	3,206	6,165	460	604	10,435
Depreciation and impairment at 1 January 2021	-853	-3,594	-304	0	-4,751
Foreign exchange adjustments	-30	-119	-6	0	-156
Transferred/reclassified	-4	2	16	0	15
Depreciation and impairment of assets disposed	14	3	11	0	28
Disposals on divestment	11	0	0	0	12
Impairment/ reversed impairment	0	2	0	0	2
Depreciation	-97	-362	-48	0	-507
Depreciation and impairment at 31 Dec. 2021	-959	-4,067	-331	0	-5,357
Carrying amount at 31 December 2021	2,247	2,099	128	604	5,078

At the end of 2021, the Group had entered into contracts for the purchase of property, plant and
equipment for future delivery for an amount of DKK 369 million (2020: DKK 248 million).

Properties with evidence of impairment have been tested for impairment. No properties were written down during 2021 (2020: DKK 0 million).

Assets under construction relate to Fibertex Personal Care's construction of production line 9 in Malaysia, Fibertex Nonwovens' construction of additional nonwovens capacity in the Czech Republic and the USA, BioMar's expansion of capacity in Ecuador and GPV's expansions of capacity in Thailand and Sri Lanka.

2020	Land and buildings	Plant and machinery	Other fixtures and fittings, tools and equipment	Assets under con- struction	Total
Cost at 1 January 2020	2,768	5,488	419	772	9,446
Foreign exchange adjustments	-154	-295	-17	-26	-491
Additions	42	127	26	281	477
Additions on company acquisitions	2	1	1	0	4
Disposals on divestment	0	0	0	0	0
Disposals	-2	-7	-13	0	-21
Transferred/reclassified	276	463	15	-757	-4
Cost at 31 December 2020	2,932	5,777	431	270	9,410
Depreciation and impairment at 1 January 2020	-799	-3,412	-280	0	-4,490
Foreign exchange adjustments	38	173	12	0	223
Transferred/reclassified	0	0	3	0	2
Depreciation and impairment of assets disposed	1	4	10	0	14
Disposals on divestment	0	0	0	0	0
Impairment	0	-7	-1	0	-8
Depreciation	-93	-352	-48	0	-493
Depreciation and impairment at 31 Dec. 2020	-853	-3,594	-304	0	-4,751
Carrying amount at 31 December 2020	2,079	2,183	127	270	4,659

12

Lease assets

2021	Ships	Property	Other assets	Total
Cost at 1 January 2021	483	505	104	1,092
Foreign exchange adjustments	30	14	3	47
Additions	58	41	30	129
Additions on company acquisitions	0	10	4	14
Disposals	-21	-16	-10	-47
Remeasurement of lease assets	9	10	1	20
Cost at 31 December 2021	559	563	132	1,254
Depreciation and impairment at 1 January 2021	-156	-169	-45	-370
Foreign exchange adjustments	-11	-5	-1	-17
Impairment/ reversed impairment	0	1	-2	-1
Depreciation	-95	-92	-35	-222
Depreciation and impairment of assets disposed	20	14	9	43
Depreciation and impairment at 31 Dec. 2021	-242	-251	-74	-567
Carrying amount at 31 December 2021	317	312	58	687

DKK 18 million (2020: DKK 15 million) was recognised in the income statement for 2021 regarding leases not recognised in the balance sheet, the amount consisting of DKK 5 million in services, DKK 4 million in small assets and DKK 9 million in short-term leases.

At the balance sheet date, lease liabilities relating to small assets and services amounted to DKK 18 million (2020: DKK 9 million), of which DKK 11 million falls due within 12 months and DKK 7 million falls due in between one and five years.

At the balance sheet date, the Group dentered into leases for assets or properties of which the Group did not yet have control and which were consequently not recognised at the balance sheet date. These leases are expected to involve a total addition of lease assets of DKK 10 million in 2022.

For further information about lease debt, see note 19.

2020	Ships	Property	Other assets	Total
Cost at 1 January 2020	447	478	87	1,012
Foreign exchange adjustments	-34	-13	-3	-50
Additions	0	21	23	44
Additions on company acquisitions	0	6	0	6
Disposals	0	-4	-10	-14
Remeasurement of lease assets	70	16	7	93
Cost at 31 December 2020	483	505	104	1,092
Depreciation and impairment at 1 January 2020	-76	-84	-24	-184
Foreign exchange adjustments	5	2	1	8
Impairment	0	-2	0	-2
Depreciation	-84	-87	-30	-202
Depreciation and impairment of assets disposed	0	2	8	11
Depreciation and impairment at 31 Dec. 2020	-156	-169	-45	-370
Carrying amount at 31 December 2020	327	336	58	721

13

Investments in subsidiaries, associates and joint arrangements

The Group has the following subsidiaries and joint operations:

Alba Ejendomme A/S Aarhus, Denmark 0% 100% BioMar BioMar Group A/S Aarhus, Denmark 100% 100% Alimentsa S.A. Guayaquil, Ecuador 70% 70% BioMar A/S Brande, Denmark 100% 100% BioMar A/S Chile Holding S.A. Puerto Montt, Chile 100% 100% BioMar AB Malmoe, Sweden 100% 100% BioMar Aquacorporation Products S.A. * Cañas, Costa Rica 50% 50% BioMar Aquacultura Corporation S.A. Cañas, Costa Rica 100% 100% BioMar AS Myre, Norway 100% 100% BioMar Chile SA Puerto Montt, Chile 100% 100% BioMar Hellenic S.A. Volos, Greece 100% 100% BioMar Iberia SA Dueñas, Spain 100% 100% BioMar Ltd. Grangemouth, Scotland 100% 100% BioMar OOO Ropsha, Russia 100% 100% BioMar Pty. Ltd. Hobart, Australia 100% 100% BioMar S.A.S. Nersac, France 100% 100% BioMar Sp. z o.o. Zielona Góra, Poland 100% 100% Oy BioMar Ab Vanda, Finland 100% 100% Viet-Uc Aqua Feed Company Limited An Hiep Village, Vietnam 67.5% 0% Fibertex Personal Care Fibertex Personal Care A/S Aalborg, Denmark 100% 100% Fibertex Personal Care AG Ilsenburg, Germany 100% 100% Fibertex Personal Care Corporation Asheboro NC, USA 100% 100%	Name	Registered office	Ownership interest 2021	Ownership interest 2020

























Fibertex Personal Care K.K. Tokyo, Japan 100% 100% Fibertex Personal Care Sdn Bhd Nilai, Malaysia 100% 100%

Fibertex Nonwovens Fibertex Nonwovens A/S Aalborg, Denmark 100% 100%
Elephant Nonwovens - Nao Tecidos U.P., Lda. Estoril, Portugal 100% 100%
Fibertex Elephant España S.L. Sant Cugat del Vallés, Spain 100% 100%
Fibertex France SARL Beauchamp, France 100% 100%
Fibertex Naotecidos Ltda. Sao Paolo, Brazil 100% 100%
Fibertex Nonwovens Holding Ltd. Hong Kong, China 100% 100%
Fibertex Nonwovens Inc. Grey Court SC, USA 100% 100%
Fibertex Nonwovens S.A.S. Chemillé, France 100% 100%
Fibertex Nonwovens Shanghai Co. Ltd. Shanghai, China 100% 100%
Fibertex Nonwovens Tekstil Sanayi ve Ihracat A.Ş. Cerkezkoy, Turkey 100% 100%
Fibertex Nonwovens, a.s. Svitavy, Czech Republic 100% 100%
Fibertex North America Holding Inc. Ingleside IL, USA 100% 100%
Fibertex North America Real Estate Ingleside IL, USA 100% 100%
Fibertex Private Limited Bangalore, India 100% 100%
Fibertex South Africa Ltd. Hammarsdale, South Africa 74% 74%

		Ownership interest	Ownership interest
Name	Registered office	2021	2020
GPV
GPV International A/S	Vejle, Denmark	100%	100%
GPV Americas México S.A.P.I de CV	Guadalajara, Mexico	100%	100%
GPV Asia (Hong Kong) Ltd.	Hong Kong, Hong Kong	100%	100%
GPV Asia (Thailand) Co. Ltd.	Bangkok, Thailand	100%	100%
GPV Austria Cable GmbH	Frankenmarkt, Austria	100%	100%
GPV Austria GmbH	Frankenmarkt, Austria	100%	100%
GPV DACH (Asia) AG	Lachen, Switzerland	100%	100%
GPV DACH AG	Lachen, Switzerland	100%	100%
GPV Germany GmbH	Hildesheim, Germany	100%	100%
GPV Lanka (PVT) Ltd.	Kochchikade, Sri Lanka	100%	100%
GPV Property Solution (private) Limited **	Kochchikade, Sri Lanka	49%	49%
GPV Slovakia s.r.o.	Hlohovec, Slovakia	100%	100%
GPV Switzerland SA	Mendrisio, Switzerland	100%	100%
GPV Zhongshan Co. Ltd.	Zhongshan, China	100%	100%
HydraSpecma
HydraSpecma A/S	Skjern, Denmark	100%	100%
Dansk Afgratningsteknik A/S	Skjern, Denmark	60%	60%
HydraSpecma AB	Gothenburg, Sweden	100%	100%
HydraSpecma Norge AS	Flekkefjord, Norway	100%	100%
HydraSpecma Co. Ltd.	Shanghai, China	100%	100%
HydraSpecma Components AB	Skellefteå, Sweden	100%	100%
HydraSpecma Do Brazil Ltda	Curitiba, Brazil	90%	90%
HydraSpecma Hydraulic Systems (Tianjin) Co., Ltd. Tianjin, China		100%	100%
HydraSpecma Hydraulic U.S. Inc.	San Antonio TX, USA	100%	100%
HydraSpecma Hydraulikhuset AB	Gothenburg, Sweden	100%	100%
HydraSpecma India Private Ltd.	Chennai, India	100%	100%
HydraSpecma OY	Espoo, Finland	100%	100%
HydraSpecma Samwon Ltd.	Newton Aycliffe, UK	100%	100%
HydraSpecma Sp. z.o.o.	Stargard, Poland	100%	100%
HydraSpecma USA Inc.	Chicago IL, USA	100%	100%
HydraSpecma Wiro AB	Motala, Sweden	100%	100%
Specma Fastighets AB	Gothenburg, Sweden	100%	100%
Borg Automotive
Borg Automotive A/S	Silkeborg, Denmark	100%	100%
Borg Automotive Sp.z.o.o.	Zdunska Wola, Poland	100%	100%
Borg Automotive Spain S.L.U.	Navarra, Spain	100%	100%
Borg Automotive UK Ltd	Wednesbury, UK	100%	100%
Car Parts Industries Belgium SA	Nivelles, Belgium	100%	100%
SBS Automotive A/S	Støvring, Denmark	100%	0%
SBS Deutschland GmbH	Eisenach, Germany	100%	0%
SBS France SAS	Chaumont-en-Vexin, France	100%	0%

& Co. Group (BioMar) shares control over the production apparatus of the jointly-controlled entity with an external business partner. Accordingly, under IFRS 11, the arrangement is therefore classified as a joint operation and pro-rata consolidated. The company is recognised at the following amounts: current assets DKK 34 million (2020 DKK 25 million), non-current assets DKK 26 million (2020: DKK 25 million), current liabilities DKK 18 million (2020: DKK 9 million), non-current liabilities DKK 7 million (2020: DKK 8 million), revenue DKK 39 million (2020 DKK 36 million) and expenses DKK 39 million (2020 DKK 36 million).

** Although the Group holds only 49% of GPV Property Solution (private) Limited, the Group is considered to have a controlling interest in the company.

13

Investments in subsidiaries, joint arrangements and associates (continued)

In May, the Group company BioMar acquired 67.5% of Viet-Uc Aqua Feed Company Limited. In June, the Group company Borg Automotive acquired 100% of SBS Automotive A/S, including its subsidiaries SBS Deutschland GmbH and SBS France SAS.

The Group has the following associates:

Name	Registered office	Ownership interest 2021	Ownership interest 2020
LetSea AS	Dønna, Norway	33%	33%
ATC Patagonia S.A.	Lenca, Chile	30%	30%
Salmones Austral S.A.	Puerto Montt, Chile	23%	23%
LCL Shipping Ltd.	Grangemouth, Scotland	40%	40%
Young Tech Co. Ltd.	Chongwon, South Korea	30%	30%
Micron Specma India (Pvt.) Ltd	Rohtak, Haryana, India	25%	25%
NGIN A/S	Aarhus, Denmark	40%	40%

Associates:	2021	2020

Cost at 1 January	251	276
Foreign exchange adjustments	20	-25
Additions during the year	0	0
Cost at 31 December	271	251

Adjustments at 1 January	96	151
Foreign exchange adjustments and other changes in equity	9	-12
Dividends paid	0	0
Profit after tax from associates	34	-44
Adjustments at 31 December	139	96

Carrying amount at 31 December	411	347

2021	LetSea	ATC Patagonia	Salmones Austral	LCL Shipping	Young Tech Co. South Korea	Micron Specma India (Pvt.)	NGIN
Revenue	338	19	1,649	14	60	13	9
Profit for the year	10	-2	128	3	3	0	0
Assets	231	63	3,282	55	55	13	4
Liabilities	131	6	1,830	37	39	3	2
Recognised in the Schouw & Co. Group:
Share of profit	3	-1	29	1	1	0	0
Share of equity	33	17	333	7	5	3	1
Goodwill	0	0	11	0	0	0	1
Carrying amount at 31 December	33	17	343	7	5	3	2
					Young	Micron
2020	LetSea	ATC Patagonia	Salmones Austral	LCL Shipping	Tech Co. South Korea	Specma India (Pvt.)	NGIN
Revenue	166	15	1,089	7	28	3	7
Profit for the year	1	-4	-192	4	0	0	1
Assets	135	59	2,732	49	37	11	4
Liabilities	48	4	1,514	35	27	1	2
Recognised in the Schouw & Co. Group:
Share of profit	0	-1	-44	2	0	0	0
Share of equity	29	16	279	6	3	3	1
Goodwill	0	0	10	0	0	0	1

Salmones Austral is individually considered to be of significant importance to the Group. The comprehensive income in Salmones Austral for 2021 amounted to DKK 128 million (2020: negative at DKK 192 million), its EBITDA was DKK 261 million (2020: negative at DKK 112 million) and its NIBD at 31 December was DKK 801 million (2020: DKK 715 million).

Salmones Austral had non-current assets of DKK 1,858 million at 31 December 2019 (2020: DKK 1,555 million), current assets of DKK 1,424 million (2020: DKK 1,177 million), non-current debt of DKK 1,054 million (2020: DKK 895 million) and current debt of DKK 775 million (2020: DKK 619 million).

13

Investments in subsidiaries, associates and joint ventures (continued)

The Group has the following joint ventures:

Name	Registered office	Ownership interest 2021	Ownership interest 2020
BioMar-Sagun TTK	Söke, Turkey	50%	50%
BioMar-Tongwei (Wuxi) Biotech Co., Ltd.	Wuxi, China	50%	50%
Joint ventures:		2021	2020
Cost at 1 January		146	153
Reclassified		0	-7
Additions during the year		0	0
Disposals for the year		0	0
Cost at 31 December		146	146
Adjustments at 1 January		-13	-17
Reclassified		0	7
Foreign exchange adjustments		2	-10
Share of profit after tax in joint ventures		12	8
Adjustments at 31 December		2	-13
Carrying amount at 31 December		148	134

2021	BioMar Sagun	BioMar Tongwei
Revenue	151	821
Profit for the year	14	10
Assets	106	426
Liabilities	64	179
Recognised in the Schouw & Co. Group:
Share of profit	7	5
Share of equity	21	124
Goodwill	1	2
Carrying amount at 31 December	23	126

2020	BioMar Sagun	BioMar Tongwei
Revenue	136	546
Profit for the year	17	-2
Assets	100	288
Liabilities	51	77
Recognised in the Schouw & Co. Group:
Share of profit	9	-1
Share of equity	25	106
Goodwill	1	2
Carrying amount at 31 December	26	108

14

Receivables – non-current

	2021	2020
Loans to customers	170	2
Other non-current receivables	72	39
Total non-current receivables	241	41

In connection with the signing of a long-term feed contract, BioMar has provided a DKK 160 million loan to a customer. The loan matures in seven years and carries interest over its term. BioMar has also provided a smaller loan to another customer.

15

Acquisitions

	Viet-Uc	TMI	SBS	2021	2020

Customer relationships	0	0	0	0	22
Brands	0	0	36	36	0
Know-how	0	0	0	0	27
Property, plant and equipment	25	0	35	60	4
Lease assets	2	0	12	14	6
Financial assets	0	0	1	1	0
Inventories	1	0	160	161	24
Receivables	0	0	120	121	16
Tax assets	0	0	17	17	0
Cash and cash equivalents	1	0	2	2	0
Credit institutions	0	0	-83	-83	-6
Provisions	0	0	-4	-4	-2
Trade payables	0	0	-102	-102	-7
Other payables	0	0	-36	-36	-8
Current tax	0	0	-3	-3	0
Net assets acquired	29	0	154	183	76
Of which non-controlling interests	-9	0	0	-9	0
Goodwill	86	0	0	86	0
Acquisition cost	105	0	154	260	76
of which cash and cash equivalents	-1	0	-2	-2	0
Contingent consideration	-66	0	-154	-220	-16
Earn-out settled	0	8	0	8	0
Total cash acquisition costs	39	8	-2	45	60

Viet-Uc

By taking over a majority shareholding in Vietnamese shrimp feed producer Viet-Uc, BioMar has taken an important step towards establishing a global presence in the production of shrimp feed. The acquisition provides crucial access to the Vietnamese market for shrimp farming, whose annual production of more than 600,000 tonnes of shrimp makes it one of the world's largest of its kind.

BioMar acquired 67.5% of the shares effective 1 May 2021 at an expected total purchase price of DKK 105 million. The purchase sum consists of DKK 39 million in cash and expected earn-out payments of DKK 66 million. The final purchase price will be made up on the basis of the company's EBITDA for the years 2024 and 2025.

The acquisition does not involve identifiable added values in the company. Goodwill on acquisition amounted to DKK 86 million, which is not deductible for tax purposes. The acquisition of Viet-Uc involved costs of DKK 1.1 million, which amount has been recognised under operating expenses. During the period of recognition, the company has contributed revenue of DKK 6.5 million and an EBITDA loss of DKK 0.3 million. Had the company been acquired effective from 1 January 2021, its EBITDA would have been DKK 2 million less, while revenue would have been the same.

TMI

In June 2021, Borg Automotive paid DKK 8 million as the initial part of earn-out payments relating to the acquisition of Turbo Motor Inyección (TMI). The second and final part of the earn-out payments is expected to be paid in 2022. The acquisition of TMI was recognised in 2020.

SBS Automotive

Borg Automotive acquired SBS Automotive (SBS) effective at 1 July 2021, opening the door to a new business segment. Headquartered in Støvring, Denmark, SBS Automotive is a trading company with its main focus on the sale of brake discs, but also an active player in the sale of steering components, wheel bearings and shock absorbers. SBS has distribution centres in Denmark, Germany, France and Poland and a workforce of about 135 employees. In 2020, SBS generated revenue of DKK 455 million and an EBITDA of about DKK 20 million.

The entire purchase price is based on an earn-out model, under which Borg Automotive will pay five times SBS's normalised 2022 EBITDA. Borg Automotive currently estimates that the net cash consideration will amount to DKK 154 million to be settled at the beginning of 2023. As the purchase price is not payable until during the first half of 2023, the amount is amortised until the settlement date. At the end of 2021, accrued interest on the liability was added in the amount of DKK 10 million, so that it amounted to DKK 164 million at 31 December 2021.

In a preliminary purchase price allocation prepared in connection with the acquisition, values in excess of carrying amounts in inventories and in intangible assets in the form of brands have been identified whereas values lower than carrying amounts have been estimated for property, plant and equipment. Goodwill has not been calculated in connection with the acquisition.

During the period of recognition, SBS contributed revenue of DKK 243 million and an EBITDA loss of DKK 8 million. Had the company been acquired effective at 1 January 2021, revenue would have been DKK 262 million higher and profit would have been DKK 9 million higher. The acquisition involved acquisition costs of DKK 7 million, of which half was incurred in 2020. The acquisition costs have been recognised under operating expenses.

2020

In 2020, the Group company Borg Automotive acquired the turbocharger operations of the Spanish company Turbo Motor Inyección (TMI).

flows in a five-year budget and forecast period (2022-2026).

related to Alimentsa (BioMar Ecuador).

The table below shows the amounts for each company:

Main companies/goodwill 1,901

Other companies/goodwill 633 Total 2,536

The estimates for the Schouw & Co. entities vary from 1% to 3% growth.

Goodwill

Impairment test

Management's report

Consolidated statements Consolidated statements

Total goodwill in Schouw & Co. of DKK 2,536 million mainly comprises DKK 795 million related to the original BioMar group, DKK 590 million related to Alimentsa (BioMar Ecuador) and DKK 516 million related to Borg Automotive, in aggregate making up 75% of the Group's total goodwill. The original BioMar group means BioMar excluding the acquisitions of Alimentsa and Viet-Uc.

Alimentsa (BioMar Ecuador) is considered a separate cash-generating unit, and it is still considered possible to test this unit separately, as integration with the other BioMar businesses is limited. This is due to the fact that products and market conditions applying to the shrimp feed produced by Alimentsa are materially different from those applying to feed for the other fish species that BioMar is involved in. Consequently, Alimentsa is tested separately. The original BioMar group suffered losses in 2021, as sales in especially the Chilean market were hit by a combination of biological issues and lower-than-normal biomass. In the Spanish market, BioMar was also affected by a lowerthan-normal biomass due to a severe storm in January 2020. In the impairment test of the original BioMar group, both of these issues are expected to be normalised, resulting in an expected volume improvement of about 4.5% in 2022 followed by annual growth of close to 3% in the remaining years of the test period. Alimentsa continues to operate in a growth industry, and in order to meet market demand, Alimentsa has initiated the construction of two additional production lines, which are expected to be commissioned in 2023. Alimentsa is therefore expected to have sufficient capacity to increase revenue by 8.4% annually during the test period.

The automotive remanufacturing market also continues to grow. This fact combined with Borg Automotive's strong market position, continuous capacity expansions and growing product portfolio due to, among other things, the acquisitions and integration of TMI and SBS, means that Borg Automotive is expected to achieve 6.2% annual growth during the test period.

The impairment tests made at 31 December 2021 did not result in a write-down of carrying amounts.

Sensitivity analyses were performed as part of the tests to determine if reduced cash flows or a higher WACC would produce evidence of impairment. The sensitivity analyses showed that likely changes in basic assumptions would not produce evidence of impairment.

Other intangible assets

At 31 December 2021, Schouw & Co. recognised other intangible assets of DKK 1,035 million, DKK 22 million less than at 31 December 2020. An addition of DKK 36 million was recognised in relation to Borg Automotive's acquisition of SBS Automotive. A further addition of DKK 49 million was mainly related to IT projects. Other intangible assets were reduced by DKK 134 million due to amortisation. The remaining changes under other intangible assets were due to foreign exchange adjustments.

* Viet-Uc, which was acquired on 1 May 2021, was not for impairment at the balance sheet date but will be tested before 30 June 2022.

Carrying amount of goodwill

The management of Schouw & Co. has tested the carrying amounts of all goodwill in the Group. In the tests performed, the senior management of each company estimated the expected free cash

The impairment test estimates the present value of goodwill (value-in-use principle) by discounting expected free cash flows using an estimated discount rate to assess the company's total value and related goodwill, which is subsequently compared with the carrying amount recognised in the Schouw & Co. consolidated financial statements. The rate of growth post the forecast period, the so-called terminal growth, is based on general long-term growth forecasts for the individual markets.

At 31 December 2021, capitalised goodwill in the Schouw & Co. Group amounted to DKK 2,536 million, compared with DKK 2,366 million at 31 December 2020. During the year, goodwill in the amount of DKK 86 million was added in connection with the BioMar group's acquisition of Viet-Uc. The remainder of the change consisted of foreign exchange adjustments of DKK 84 million, largely

The discount rate (WACC) was estimated on the basis of available market data and an assessment of the risk profile of the individual entities. Specifically, a risk-free interest rate based on the current yield of a 10-year government bond in the relevant geography plus an estimated market-risk premium are used to estimate the required rate of return on equity. Estimated risk premiums are then added, depending on industry, business model and geography. The required rate of return on debt is based on an estimated credit assessment of the entities and current interest rate levels. The required rates of return on debt and equity are weighted using a capital structure based on a group of company peers.

Revenue growth

BioMar (excl. Alimentsa) 795 2.7% 2.0% 5.8% 7.3% Alimentsa (BioMar Ecuador) 590 8.4% 3.0% 10.9% 13.4% Borg Automotive 516 6.2% 2.0% 8.3% 10.3%

Viet-Uc 92 * * * * Fibertex Personal Care 99 2.0% 2.0% 6.5% 8.0% Fibertex Nonwovens 119 4.0% 2.0% 7.6% 9.5% GPV International 181 5.3% 2.0% 8.0% 8.3% HydraSpecma 143 6.5% 2.0% 6.5% 7.8%

Assumptions

WACC after tax

WACC before tax

Terminal year growth

Property, plant and equipment

No impairment of property, plant and equipment was recognised in 2021, but GPV reversed impair ment writedowns previously made in the amount of DKK 2 million.

Other non-current assets

There were no indications of impairment of other non-current assets, apart from a DKK 2 million write-down of lease assets. GPV reversed an impairment writedown previously made in the amount of DKK 1 million.

Consolidated statements

This section of the annual report contains notes relating to the Group's capital structure.

The following notes are presented in this section: 17 Financial income 18 Financial expenses 19 Interest-bearing debt 20 Net interest-bearing debt 21 Share capital

Financial income of DKK 85 million in 2021 in-

12 million, up by DKK 7 million compared with

million to DKK 56 million. Other interest income

Financial expenses fell by DKK 60 million from DKK 209 million in 2020 to DKK 149 million in 2021, which was mainly the result of a reduction of foreign exchange losses of DKK 66 million from DKK 105 million in 2020 to DKK 38 million in 2021. In 2021, the Group recognised DKK 15 million in amortisation of earn-out purchase obligations relating to the acquisitions of SBS and Viet-Uc. Dividends paid in 2021 to the minority shareholder of Alimentsa amounted to DKK 13 million compared with DKK 12 million in 2020. The remainder of the financial expenses, covering interest payments on interest-bearing debt, including lease debt and settlement of interest hedging, amounted to DKK 84 million in 2021, compared with DKK 93 million in 2020.

Interest-bearing debt was DKK 3,453 million at 31 December 2021, representing a year-on-year increase of DKK 855 million. The increase was

Comments

Financial income

million in 2021.

Financial expenses

mainly due to the significant increase in working capital during the year and to the increased investment activity. A large part of the Group's debt is in DKK or in EUR, these currencies representing 55% of total debt in 2021 (2020: 56%). NOK, AUD and USD each account for 11% of the debt, while a number of other currencies combine to make up the remaining 12%.

Interest-bearing debt

Net interest-bearing debt

Due to the increased working capital and the increased investment volume, net interestbearing debt grew by DKK 836 million to DKK 2,773 million at 31 December 2021.

Treasury shares

The share capital was unchanged at 25,500,000 shares of DKK 100 each. At 31 December 2020, Schouw & Co. held 1,520,724 treasury shares, corresponding to 5.96% of the share capital. In 2021, the Group purchased 10,378 treasury shares for purposes of its share option programme. Accordingly, Schouw & Co. held 1,531,102 treasury shares at 31 December 2017, corresponding to 6.00% of the share capital.

The portfolio of treasury shares is recognised at DKK 0.

Accounting policies

Financial income and expenses

Financial income and expenses include interest and capital gains and losses on transactions in foreign currency and impairment losses on securities. Also included are amortisation of financial assets and liabilities, lease liabilities, surcharges and refunds under the on-account tax scheme. and changes in fair values of derivative financial instruments that do not qualify as hedge accounting. Financial expenses relating to the construction of non-current assets are recognised as part of the cost of the asset.

Financial liabilities

Debt to credit institutions is recognised at the raising of a loan at fair value less transaction costs. In subsequent periods, financial liabilities are measured at amortised cost, applying the "effective interest rate method", to the effect that the difference between the proceeds and the nominal value is recognised in the income statement under financial expenses over the term of the loan. In addition, the capitalised residual lease liability under finance leases is recognised under financial liabilities.

Accounting estimates

No significant accounting estimates were made in the calculation of financial liabilities.

Liabilities

17

Financial income

	2021	2020

Interest income	18	17
Foreign exchange adjustments	56	54
Fair value adjustment of financial assets	12	5
Total	85	76

18

Financial expenses

	2021	2020

Interest expense	-61	-67
Amortisation of earn-out-purchase obligation	-15	0
Amortisation of lease debt	-21	-24
Fair value adjustment of hedging transactions transferred from equity	-2	-2
Foreign exchange adjustments	-38	-105
Dividend payment to non-controlling shareholder in Alimentsa (BioMar Ecuador)	-13	-12
Total	-149	-209

Borrowing costs of DKK 2 million were capitalised in 2021 (2020: DKK 5 million) based on an average rate of interest of 2.4% p.a. (2020: 1.8%).

19

Interest-bearing debt

Debt recognised in the balance sheet:

	2021	2020

Credit institutions (non-current)	1,805	1,090
Mortgage debt (non-current)	63	98
Lease debt (non-current)	516	555
Recognised as non-current interest-bearing debt	2,384	1,742
Current portion of mortgage debt	42	41
Current portion of lease debt	215	188
Credit institutions (current)	812	628
Recognised as current interest-bearing debt	1,070	856
Total interest-bearing debt	3,453	2,599

The fair value of interest-bearing debt corresponds in all material respects to the carrying amount.

Percentage breakdown of interest-bearing debt by currency

19

Interest-bearing debt (continued)

Maturity profile of interest-bearing debt, including lease debt:

	2021		2020
	Interest bearing debt	Of which lease debt	Interest bearing debt	Of which lease debt
Instalments
Overdraft facilities without planned repayment	756		601
Less than 1 year	346	233	286	207
1-5 years	2,197	456	1,530	511
More than 5 years	280	91	300	82
Total	3,579	780	2,717	800
Interest
Overdraft facilities without planned repayment	0		0
Less than 1 year	32	17	30	19
1-5 years	80	20	80	31
More than 5 years	14	11	8	7
Total	126	49	118	57
Carrying amount
Overdraft facilities without planned repayment	756		601
Less than 1 year	313	215	256	188
1-5 years	2,117	436	1,450	480
More than 5 years	267	80	292	74
Total	3,453	731	2,599	743

Spot rate used for floating rate loans in the table above.

The fair value of liabilities relating to lease assets corresponds in all material respects to the carrying amount. The lease liability was calculated using mainly an alternative discount rate based on the lease term, the base rate of the country in question and a risk premium, among other factors. The average discount rate applied was 2.7% per annum (2020: 2.8%).

Total lease payments made in 2021 amounted to DKK 241 million (2020: DKK 220 million), consisting of a repayment of DKK 220 million (2020: 196 million) and interest of DKK 21 million (2020: DKK 24 million).

The weighted average effective rate of interest for the year was 2.8% (2020: 2.8%). The weighted average effective rate of interest at the balance sheet date was 1.7% (2020: 2.1%).

For further information about lease assets, see note 12.

Interest profile of interest-bearing debt

Fixed-rate debt includes loans for which the rate of interest will not be reset within the next year. Interest on lease debt is treated as fixed-rate debt.

	2021	2020
Interest hedging expires in:
Less than 1 year	54	0
1-5 years	18	77
More than 5 years	0	18
Total	72	95

An increase in interest rates of 1 percentage point would cause the annual interest expense to increase by about DKK 17 million after tax (2020: DKK 11 million). This would expectedly reduce shareholders' equity by about DKK 16 million after tax (2020: DKK 9 million).

A decrease in interest rates of 1 percentage point would cause the annual interest expense to decrease by about DKK 17 million after tax (2020: DKK 11 million). This would expectedly increase shareholders' equity by about DKK 16 million after tax (2020: DKK 9 million).

Interest-bearing debt (continued)

Capital resources

It is group policy when raising loans to maximise flexibility by diversifying borrowing in respect of maturity/renegotiation dates and counterparties, with due consideration to costs. The Group's capital resources consist of cash and undrawn credit facilities. The Group's objective is to have sufficient capital resources to make company acquisitions and to allow it to continue in an adequate manner to operate the business and to react to unforeseen fluctuations in its cash holdings.

	Loans and lines	Of which	utilised Unutilised	Commitment	Avg. term to maturity
Revolving credit facility	3,275	479	2,796	Committed	3 years
Other credit facilities	735	653		83 Uncommitted
Schuldschein	1,011	1,011	0		Committed 2 yrs 8 mths
Mortgages	105	105	0		Committed 3 yrs 4 mths
Other long-term debt (NIB)	400	400	0	Committed	7 years
Other long-term debt	74	74		0 Uncommitted 4 yrs 8 mths
Leases	731	731	0	Committed
Cash and cash equivalents			490
Facility before deduction of guarantee commitments	6,331	3,453	3,369
Guarantee commitments deducted from the facility			-124
Total capital resources at 31 December 2021			3,245

The Group's companies get a significant proportion of their financing from resources and credit facilities of the parent company Schouw & Co. The parent company Schouw & Co.'s financing consists mainly of a syndicated bank facility, which in December 2020 was refinanced with a total facility line of DKK 3,275 million. The facility has a three-year term with an option for a one-year extension after the first and second year. In connection with refinancing the bank facility, the international bank Hongkong & Shanghai Banking Corporation (HSBC) joined the existing bank consortium consisting of Danske Bank, DNB and Nordea. The first extension option was utilised in December 2021.

In April 2019, Schouw & Co. issued Schuldscheins for a total of EUR 136 million (DKK 1,011 million) maturing in 2024 (80%) and 2026 (20%). In December 2021, Schouw & Co. set up a DKK 400 million seven-year loan with Nordic Investment Bank related to specific Danish capacity-expanding investments and development costs.

Capital management

Schouw & Co. gives priority to having a high equity ratio in order to ensure financial versatility as well as to having adequate capital resources. The Group believes that its total capital resources of DKK 3,245 million represent appropriate cash resources. The Group aims to have a financial gearing in

the range of 1.0x to 2.5x. During periods immediately following a (major) acquisition, however, gearing may exceed 2.5x. At 31 December 2021, the financial gearing was 1.2x.

20

Net interest-bearing debt

			Non-cash items
2021	Begin- ning of year	Cash flows	Acquisitions / divest- ments	Foreign exchange adjust- ments	Leases	Other	End of year
Interest-bearing liabilities:
Non-current debt	1,742	536	26	6	-87	161	2,384
Current debt	856	52	47	43	232	-161	1,070
Total interest-bearing liabilities	2,599	588	73	49	145	0	3,453
Interest-bearing assets:
Non-current receivables	2	167	1	0	0	0	170
Current receivables	26	-7	0	2	0	0	21
Cash and cash equivalents	635	-170	2	24	0	0	490
Total interest-bearing assets	662	-11	3	26	0	0	681
Net interest-bearing debt	1,936	598	69	24	145	0	2,773

	Non-cash items
2020	Begin ning of year	Cash flows	Acquisitions	Foreign exchange adjust ments	Leases	Other	End of year
Interest-bearing liabilities:
Non-current debt	2,976	-1,001	5	-89	-66	-84	1,742
Current debt	909	-304	1	-32	198	84	856
Total interest-bearing liabilities	3,885	-1,305	6	-120	132	0	2,599
Interest-bearing assets:
Non-current receivables	2	0	0	0	0	0	2
Current receivables	47	-20	0	-2	0	0	26
Cash and cash equivalents	538	133	0	-37	0	0	635
Total interest-bearing assets	587	114	0	-39	0	0	662
Net interest-bearing debt	3,298	-1,419	6	-81	132	0	1,936

Management's report

21 Share capital

The share capital consists of 25,500,000 shares with a nominal value of DKK 10 each. All shares rank equally. The share capital is fully paid up.

31 December 2021	1,531,102	15,311,020	471	6.00%
Purchase of treasury shares	10,378	103,780	6	0.04%
31 December 2020	1,520,724	15,207,240	466	5.96%
Share option programme	-23,556	-235,560	-3	-0.09%
1 January 2020	1,544,280	15,442,800	469	6.06%
Treasury shares	Number of shares	Nominal value (DKK)	Cost	Percentage of share capital

In 2021, Schouw & Co. acquired shares for DKK 6 million to be held in treasury. The purchase was part of a programme under which Schouw & Co. intends to buy back shares held in treasury for a total amount of DKK 350 million in the period from 27 December 2021 to 30 December 2022.

Schouw & Co. has been authorised by the shareholders in general meeting to acquire up to 5,100,000 treasury shares, equal to 20.0% of the share capital. The authorisation is valid until 1 April 2025.

The company acquires treasury shares among other things for allocation to the Group's share-based incentive programmes and for adjustment of the company's capital structure in in connection with capital reductions. At 31 December 2021, the company's treasury shares had a market value of DKK 871 million (2020: DKK 937 million). The portfolio of treasury shares is recognised at DKK 0.

The share capital has not changed in the past five years.

Dividend

A dividend of DKK 15 per share is proposed in respect of the 2021 financial year for a total dividend amount of DKK 383 million and a dividend payout of 37% of the profit for the year. On 20 April 2021, the Group paid dividend in respect of 2020 of DKK 14 per share for a total dividend amount of DKK 357 million.

The dividend payout ratio expresses the total dividend paid relative to the consolidated profit for the year.

Dividend per share (DKK):

Amounts in DKK million

This section of the annual report contains notes relating to the Group's taxation.

The following notes are presented in this section: 22 Tax on profit/loss for the year 23 Deferred tax 24 Income tax

Comments

The Group's tax policy is available to the public and is described in further detail in the Group's 2021 ESG Report. Both of these documents are available on the company's website.

Income tax

Schouw & Co. recorded a profit for the year before tax of DKK 1,332 million (2020: DKK 1,209 million), resulting in total tax for the year of DKK 293 million (2020: DKK 300 million). Profit before tax includes a share of profit after tax in associates and joint ventures of DKK 46 million (2020: share of loss of DKK 36 million). The tax on the share of profit or loss is not included in the tax for the year, for which reason the profit before tax has been adjusted for the share of profit in the explanation of the effective tax rate. The effective tax rate for the year amounts to 22.8% of the adjusted profit before tax (2020: 24.1%). The Group's weighted tax rate fell to 22.7% (2020: 23.7%), due in part to lowered corporate tax rates, primarily in Sweden and France. The effective tax rate has declined partly due to an increase in tax-exempt income, including in connection with investment grant schemes.

The effective tax rate was reduced despite an additional tax payment amounting to DKK 16 million in connection with a now resolved tax case in France and recognition of withholding tax amounting to DKK 7 million that could not be offset against other corporate income tax.

Accounting policies

Taxation

Schouw & Co. is taxed jointly with all its Danish subsidiaries. The current Danish income tax liability is allocated among the companies of the tax pool in proportion to their taxable income. Companies that use tax losses in other companies pay a joint tax contribution to the parent company at an amount corresponding to the tax value of the tax losses used. Companies whose tax losses are used by other companies receive joint tax contributions from the parent company corresponding to the tax value of the losses used (full absorption). The jointly taxed companies pay tax under the Danish on-account tax scheme.

Tax for the year comprises current tax and changes in deferred tax for the year. In addition, the tax for the year comprises changes to prior-year tax and changes in assessed provisions for uncertain tax positions. Tax for the year is recognised in the income statement as regards the amount attributable to the profit for the year and in equity as regards the amount attributable to equity entries.

In certain countries, the distribution of dividends is liable to taxation. Tax on dividends is provided only to the extent a resolution to distribute dividends has been made or to the extent the company has a dividend distribution policy.

To the extent the Schouw & Co. Group benefits from a deduction in the determination of its taxable income in Denmark due to share-based incentive programmes, the tax effect of such programmes is included in income tax. Any tax deduction exceeding the accounting cost is recognised directly in equity.

Current tax liabilities and current tax receivables are recognised in the balance sheet as calculated tax on the taxable income for the year, adjusted

for tax on prior years' taxable income and for tax paid under the on-account tax scheme.

Deferred tax is measured in accordance with the balance sheet liability method on all timing differences between the carrying amount and tax base of assets and liabilities. However, no deferred tax is recognised on timing differences regarding non-deductible goodwill and other items for which timing differences have arisen at the acquisition date without affecting the financial results or taxable income.

Deferred tax assets, including the tax base of tax loss carry-forwards, are recognised under other non-current assets at the expected value of their utilisation, either as a set-off against tax on future income or as a set-off against deferred tax liabilities within the same legal tax entity and jurisdiction. Deferred tax adjustments are made regarding eliminations of unrealised intercompany gains and losses. Deferred tax is measured based on the tax rules and rates in the respective countries that will apply under the legislation in force on the balance sheet date when the deferred tax asset is expected to crystallise as current tax. Changes in deferred tax resulting from changes in tax rates are recognised in the income statement.

Deferred tax assets are reviewed annually and recognised only to the extent that it is probable that they will be utilised. Depending on type, uncertain tax position are measured either as a probability-weighted average of possible outcomes or as the most likely outcome. Uncertain tax positions are recognised in the tax positions they relate to, i.e. as current tax or deferred tax as the case may be, unless it is deemed highly probable that the tax authorities will accept the company's tax treatment of the matter in question.

Accounting estimates

Deferred tax assets

The calculation of deferred tax assets is based on estimates of the extent to which prior-year losses can be utilised against future earnings. For Danish companies, tax assets have been capitalised at a tax rate of from 22%. The Group has operations and is liable for tax in many different countries. The calculation of tax payable for the year and the computation of taxable income involves making significant estimates regarding tax assets/liabilities and provisions for uncertain tax positions. However, in some instances the tax treatment in the relevant tax jurisdictions has not been finally resolved This may result in discrepancies between calculated tax and actual tax payments.

Deferred tax, including prior-year tax losses, is recognised at the tax rate expected to apply taking into account current local tax rules. Tax losses are capitalised to the extent management believes they can be used within a few years. Such estimates are made at least once a year on the basis of budgets and business plans for the following years. Accordingly, those estimates are inherently subject to a degree of uncertainty. Another factor considered is the distribution of taxable income on the basis of the companies' transfer pricing policies. At 31 December 2021, the Group had capitalised tax losses at a value for tax purposes of DKK 55 million, which are expected to be utilised within the next few years. Non-capitalised tax losses at an aggregate total value for tax purposes of DKK 112 million are not expected to be utilised within the next few years. More than one third of the non-recognised losses relate to Fibertex Nonwovens in South Africa, while the remaining losses primarily relate to GPV Slovakia, GPV Germany and Borg Automotive UK.

A pending case involving the Malaysian tax authorities is discussed in the note "Deferred tax".

22 Tax on profit/loss for the year

	2021	2020

Tax on the profit for the year is specified as follows:
Tax on profit/loss for the year	-293	-300
Tax on other comprehensive income	-7	3
Total tax	-301	-297
Tax on the profit for the year has been calculated as follows:
Current tax	-285	-323
Deferred tax	9	25
Change in deferred tax due to change in corporate tax rates	-1	0
Adjustment of prior-year tax charge	-16	-3
Total tax recognised in the income statement	-293	-300
Specification of the tax on the profit for the year:
Profit before tax	1,332	1,209
Profit/loss after tax in associates and joint ventures	-46	36
Profit before tax excl. profit/loss after tax in associates and joint ventures	1,286	1,245
Corporate tax rate in Denmark	22.0%	22.0%
Tax in foreign subsidiaries adjusted relative to 22%	0.7%	1.7%
Weighted consolidated corporate tax rate	22.7%	23.7%
Tax effect of:
Non-taxable income	-3.7%	-2.4%
Non-deductible costs	2.9%	2.7%
Investment grants	-0.2%	0.0%
Adjustment of prior-year tax charge	1.4%	0.2%
Withholding tax	0.6%	0.0%
Non-recognised losses for the year	0.5%	0.0%
Revised valuation of tax asset	-0.3%	0.2%
Tax assets recognised during the year	-1.1%	-0.4%
Effective tax rate	22.8%	24.1%

Tax on items recognised in other comprehensive income	Before tax	Taxation	After tax
Foreign exchange adjustments of foreign units, etc.	316	0	316
Hedging instruments for the year	-12	3	-9
Hedging instruments transferred to cost of sales	5	0	5
Hedging instruments transferred to financials	2	0	1
Other comprehensive income from associates and JVs	1	0	1
Adjustment of defined benefit pension plan	51	-9	42
Other adjustments recognised directly in equity	-1	0	-1
Total tax on items recognised in
other comprehensive income	363	-7	356

2020

2021

Tax on items recognised in other comprehensive income	Before tax	Taxation	After tax
Foreign exchange adjustments of foreign units, etc.	-493	0	-493
Hedging instruments for the year	-8	1	-8
Hedging instruments transferred to cost of sales	-2	0	-2
Hedging instruments transferred to financials	2	0	2
Other comprehensive income from associates and JVs	-11	0	-11
Adjustment of defined benefit pension plan	-17	3	-15
Other adjustments recognised directly in equity	-2	0	-2
Total tax on items recognised in
other comprehensive income	-531	3	-528

Management's report Management's report

Consolidated statements Consolidated statements

23

Deferred tax

	2021
Change in deferred tax	Balance at 1 January	Foreign exchange adjustments	Additions on acquisitions	Disposals on divestments	Recognised in the profit for the year	Recognised in equity	Balance at 31 December
Intangible assets	205	7	-8	0	-23	0	180
Property, plant and equipment	244	15	-2	-1	3	0	259
Receivables	-37	-1	0	0	10	0	-27
Inventories	-3	1	-1	0	7	0	4
Other current assets	11	0	0	0	-9	0	3
Shareholders' equity	5	0	0	0	0	9	14
Provisions	-35	31	0	0	-2	0	-6
Other liabilities	-76	-33	-1	0	3	-3	-110
Expected utilisation of investment grant	-14	-1	0	0	4	0	-11
Tax losses	-47	-2	-5	0	-1	0	-55
Total change in deferred tax	253	17	-17	-1	-9	7	250

Change in deferred tax	Balance at 1 January	Foreign exchange adjustments	Recognised in the profit for the year	Recognised in equity	Balance at 31 December
Intangible assets	239	-9	-25	0	205
Property, plant and equipment	241	-15	18	0	244
Receivables	-32	1	-6	0	-37
Inventories	2	-1	-4	0	-3
Other current assets	13	0	-2	0	11
Shareholders' equity	9	1	-2	-4	5
Provisions	-37	0	2	0	-35
Other liabilities	-79	3	1	-1	-76
Expected utilisation of investment grant	-19	1	5	0	-14
Tax losses	-51	3	1	0	-47
Total change in deferred tax	286	-16	-13	-5	253

2020

23 Deferred tax (continued)

	2021	2020

Deferred tax at 1 January	253	286
Foreign exchange adjustments	17	-16
Deferred tax adjustment at 1 January	0	12
Deferred tax for the year recognised in profit/loss for the year	-9	-25
Reduction of Danish corporate tax rate	1	0
Deferred tax for the year recognised in equity	7	-5
Additions on acquisitions	-17	0
Disposals on divestment	-1	0
Deferred tax at 31 December, net	250	253

Deferred tax is recognised as follows in the statement of financial position:

Deferred tax at 31 December, net	250	253
Deferred tax (liability)	372	357
Deferred tax (asset)	-122	-104

Schouw & Co. has capitalised tax assets of DKK 122 million (2020: DKK 104 million), of which the value of recognised tax losses account for DKK 55 million. It is expected that the capitalised tax asset will be absorbed by taxable income within the next few years. A tax asset of DKK 17 million was recognised in connection with the acquisition of SBS Automotive. All deferred tax liabilities are recognised in the balance sheet.

The tax value of unrecognised tax losses amounted to DKK 112 million (2020: DKK 116 million). It is considered unlikely that the deferred tax assets will be realised within a period of a few years. Close to 25% of the value of these tax losses will expire within the next five years.

In a transfer pricing review performed in 2013, the Danish tax authorities made an assessment to increase the taxable income of Fibertex Personal Care A/S by DKK 122 million for the years 2007- 2011. An administrative agreement was entered into with the Danish tax authorities in 2018 to raise the taxable income of Fibertex Personal Care A/S concerning estimated regular royalty income by DKK 87 million for the years 2007-2013, corresponding to a tax payment of DKK 22 million. The Group has subsequently opened mutual agreement procedures with the Malaysian tax authorities with a view to achieving a corresponding reduction of the taxable income of the subsidiary in Malaysia. As a corresponding reduction is believed to be highly likely, a prior-year tax asset relating to Malaysia of DKK 22 million has been recognised in the consolidated financial statements at 31 December 2021. This matter is unchanged from last year.

24

Income tax

	2021	2020

Income tax payable at 1 January	67	78
Foreign exchange adjustments	2	-7
Current tax for the year	285	323
Adjustment related to prior years	16	-17
Transferred from deferred tax	2	0
Additions on company acquisitions	3	0
Income tax paid during the year	-381	-309
Income tax at 31 December	-5	67
which is specified as follows:
Income tax (asset)	-77	-88
Income tax (liability)	72	155
Income tax at 31 December	-5	67

Income tax paid by country, 2021

12 11 10	Scotland Spain Sweden	4 4 4	England Japan	1 0.3



16	Belgium	4	India	1
29	China	5	Mexico	1
33	Costa Rica	5	Czech Republic	1
35	Germany	7	Austria	1
39	Poland	7	Finland	2
46	Sri Lanka	7	Turkey	3
82	Thailand	8	Brazil	3

The above is an exhaustive presentation of corporate income taxes paid by country in 2021. In addition to these countries, the Group has activities in Australia, Portugal, Slovakia, South Africa and Vietnam, in which countries the Group paid no income tax in 2021 in accordance with local tax legislation.

This section of the annual report contains other mandatory notes that do not fall within the scope of the other sections of the report.

The following notes are presented in this section:

25 Adjustment for non-cash transactions 26 Securities 27 Other payables 28 Liabilities regarding put option 29 Contingent liabilities 30 Guarantees 31 Financial risk 32 Categories of financial assets and liabilities 33 Fees to auditors appointed by the general meeting 34 Earnings per share (DKK) 35 Related party transactions 36 Events after the balance sheet date 37 New financial reporting regulations

Comments

Securities

The carrying amount of the Group's securities at 31 December 2021 consisted mainly of a 15.8% shareholding in Incuba A/S.

Contingent consideration

In connection with the acquisitions of Viet-Uc and SBS during the year, there was a considerable increase in the Group's contingent consideration (earn-out), which previously solely consisted of a minor liability regarding the acquisition of TMI in 2020. At 31 December 2021, the liability was calculated at DKK 247 million, of which DKK 8 million was recognised under current liabilities.

Accounting policies

Securities

Security holdings which do not enable the company to exercise control or a significant influence are measured at fair value. Value adjustments of securities for which changes in fair value are regularly monitored, are recognised under financial items in the income statement when they occur.

Liability regarding put option

Debt relating to a put option for the purchase of non-controlling interests is initially measured at fair value. Fair value is determined as the present value of the exercise price of the option. The option is subsequently measured at amortised cost corresponding to the discounted value of the expected future cash flows. Value adjustments are recognised directly in equity. Dividend payments agreed in relation to the put option are considered a financial expense and recognised in the income statement.

Pension liabilities

The Group has set up pension plans and similar arrangements with the majority of the Group's employees.

Liabilities relating to defined contribution plans are recognised in the income statement in the period in which the benefits vest, and payments due are recognised in the balance sheet under other payables.

For defined benefit plans, annual actuarial calculations are made of the net present value of future benefits to be paid under the plan. The net present value is calculated based on assumptions of the future developments of salary, interest, inflation and mortality rates, among other things. The net present value is calculated only for those benefits earned by the employees through their past employment with the Group. The actuarial

calculation of the net present value less the fair value of any plan assets is recognised in the balance sheet as pension liabilities. See below.

Current service cost is recognised in the income statement based on actuarial estimates and financial forecasts at the beginning of the year. Differences between the expected development of pension assets, liabilities and the realised values are termed actuarial gains and losses and are recognised in other comprehensive income.

If changes occur in benefits payable regarding the employees' past service with the company, a change in the actuarial net present value arises. This is termed past service cost. Past service cost is recognised immediately if the employees' right to the changed benefit has already vested. If not, it is recognised in the income statement over the period during which the employees' right to the changed benefits vests.

Provisions

Provisions are recognised when, as a consequence of an event occurring before or at the balance sheet date, the Group has a legal or constructive obligation, the settlement of which is likely to result in an outflow from the Group of economic benefits.

In the measurement of provisions, the expenditure required to settle the obligation is discounted. Changes in present values during the year are recognised as financial expenses.

Warranty commitments are recognised as the sale of goods and services is effected, based on incurred warranty costs from prior financial years.

Restructuring costs are recognised as liabilities when a detailed, formal restructuring plan has been announced to the parties affected by such plan on or before the balance sheet date. On acquisition of enterprises, restructuring provisions relating to the acquired enterprise are included in the calculation of goodwill only if the acquired enterprise has a liability at the date of acquisition.

A provision for onerous contracts is recognised when the unavoidable costs under a contract exceed the expected benefits to the Group from the contract.

Other liabilities

Other liabilities are measured at net realisable value.

Accounting estimates

Liability regarding put option

The put option pertains to the acquisition of the outstanding shareholding interest in Alimentsa (BioMar Ecuador) using a pre-determined pricing model. The non-controlling shareholders may exercise the option during the period from 2020 to 2022, and its value will be based on, among other things, the company's financial results during the period until the date of exercise.

Consolidated statements

25 Adjustment for non-cash transactions

	2021	2020

Purchase of intangible assets	-49	-48
of which was not paid at the balance sheet date/date of adjustment for the year	1	0
Paid relating to purchase of intangible assets	-48	-48
Purchase of property, plant and equipment	-763	-477
of which was not paid at the balance sheet date/date of adjustment for the year	12	22
Paid relating to purchase property plant and equipment	-751	-454
Financial liabilities incurred	683	67
of which lease debt	-147	-67
Proceeds from incurring financial liabilities	536	0

26 Securities

	2021	2020
Securities measured at fair value
Cost at 1 January	45	57
Additions	0	0
Disposals	0	-11
Cost at 31 December	46	45
Adjustments at 1 January	35	22
Dividends paid	-1	-1
Disposals relating to divestment	0	9
Adjustments recognised in the income statement	12	5
Adjustments at 31 December	45	35
Carrying amount at 31 December	91	80

27 Other payables

	2021	2020
Pension liabilities	88	130
Provisions	31	33
Core liabilities	70	59
Contingent consideration	239	8
Other non-current payables	35	51
Prepayments	59	63
Total other payables	522	344

It is group policy to insure all pension liabilities and predominantly to avoid defined benefit plans. Provisions for defined benefit pension liabilities exist mainly as a result of GPV's acquisition of CCS in 2018. Total pension liabilities amounted to DKK 88 million at 31 December 2021 compared with DKK 130 million at 31 December 2019. GPV has pension plans in several units, but mainly relating to Switzerland where the liability was DKK 47 million at 31 December 2021 (2020: DKK 92 million). Like last year, provisions were actuarially calculated, and the DKK 51 million adjustment for the year was recognised as other comprehensive income. Gross liabilities amounted to a total of DKK 378 million at 31 December 2021 (2020: DKK 381 million), and the corresponding gross assets in Switzerland amounted to DKK 330 million (2020: DKK 290 million). The calculation of the present value in Switzerland is based on a discount rate of 0.30% (2020: 0.15%).

Provisions made comprise warranty commitments, etc. For certain products, the Group has a contractual commitment to provide warranties of from 12 to 24 months. Under these warranties, the Group undertakes to replace or repair goods that do not function satisfactorily. The statement of expected expiry dates is based on previous experience of when claims for repair are typically received or goods are returned.

Deferred income mainly consists of investment grants.

28 Liability regarding put option

	2021	2020
Put option at 1 January	360	369
Foreign exchange adjustments	30	-37
Change in liability during the year	-16	28
Put option at 31 December	374	360

The put option pertains to BioMar's obligation to buy the outstanding 30% of the shares in Alimentsa (BioMar Ecuador). The seller is able to exercise the put option until September 2022.

29 Contingent liabilities

The Schouw & Co. Group is currently a party to a small number of legal disputes. Management believes that the results of these legal disputes will not impact the Group's financial position other than the receivables and liabilities that have been recognised in the balance sheet at 31 December 2021.

The Chilean competition authority, Fiscalia Nacional Económica ("FNE"), initiated an investigation of the Chilean fish feed industry in October 2016. As part of the investigation, BioMar Chile SA and other companies were subject to unannounced inspections. Naturally, BioMar SA has been cooperative, responding to questions and providing documentation to the extent possible. Further to the industry investigation, the FNE indicted four Chilean fish feed producers, including BioMar Chile SA, on 19 December 2019 on charges of concerted practice, claiming that BioMar Chile SA be fined up to 30,000 annual tax units, which at 31 December 2021 corresponded to approximately DKK 150 million. The charges are based on isolated circumstances related to the Chilean fish feed industry during the 2003-2015 period.

BioMar Chile does not acknowledge the charges and intends to rebut the charges that it has participated in concerted practices so as to restrict competition in the industry. Based on the Chilean lawyers' opinion in the matter and the information currently available, management believes it is not likely that BioMar will be convicted of participating in concerted practices. Accordingly, no provisions have been recognised concerning claim submitted.

BioMar Chile submitted the company's response to the Chilean competition authorities' claim on 19 May 2020. The entire process has been delayed by the coronavirus pandemic. Initial proceedings are expected to commence in 2022, but the case is expected to continue for up to two more years.

30

Guarantees

The following assets have been provided as security to credit institutions (carrying amount):

	2021	2020

Land and buildings	483	507
Plant and machinery	134	150
Total	617	656

The collateral set out above represents the Group's debt to credit and mortgage-credit institutions of DKK 169 million (2020: DKK 142 million).

31
Financial risk

The Group's risk management policy

Due to the nature of their operations, investments and financing, each of the Group's portfolio companies are exposed to changes in exchange rates, commodity prices and interest rates.

Finance and interest rate risks are managed at group level through the parent company Schouw & Co. Currency and commodity risks are managed by the portfolio companies, but subject to the Group's risk management policy. All financial instrument transactions are intended to contribute to mitigating fluctuations in profit/loss and to secure the value of cash flows. Financial instruments are not used for speculative purposes.

Interest rate risk

Decisions to hedge interest rate risk are made at group level on the basis of an ongoing assessment of the Group's gearing and the ratio of the floating rate debt and equity. The Group's exposure relates to floating rate loans, which amounted to DKK 2,178 million. An analysis of sensitivity to changes in interest rate levels is set out in note 19.

Credit risk

The Group's credit risk is primarily related to trade receivables and cash deposits. The Group seeks to avoid significant exposure to individual customers or business partners. The Group's policy for undertaking credit risks involves an ongoing credit assessment of all major customers. At 31 December 2021, the maximum credit risk considering the collateral provided was DKK 4,973 million (trade receivables less collateral + cash).

Currency risk

Most of the Group's portfolio companies cover their currency risk naturally through same-currency procurement and manufacturing in local selling markets. In addition, it is group policy for the portfolio companies to hedge all significant transaction risks relating to future cash flows. The purpose of hedging is to stabilise the value of the Group's cash flows and mitigate profit/loss volatility.

As a general rule, currency risks are hedged by way of forward contracts with a duration of up to 12 months. Individually, the portfolio companies hedge their exposure by way of currency clauses built into customer and supplier contracts. Based on the foreign exchange exposure at the balance sheet date, the table below shows the anticipated effect on the profit of likely changes in exchange rate crosses:

Foreign currencies	Likely change in exchange rate*	Effect on profit**	Effect on equity**
USD/DKK	7.0%	-26	-18
USD/NOK	11.0%	-7	9
RUB/DKK	14.0%	6	6
ZAR/DKK	14.0%	5	5
USD/MYR	4.0%	-4	-4
CZK/DKK	5.0%	-3	-3
THB/DKK	6.0%	-3	-3
CNY/DKK	6.0%	3	3
EUR/DKK	0.3%	-3	-3
SEK/DKK	6.0%	-3	-3

* Percentage increase in exchange rate.

**) A decrease in the exchange rate would reverse the sign.

Likely change in exchange rate' is divided into different categories and based on the historical volatility of the past five years.

It is group policy not to hedge net investments or translation risk relating to the recognition of profit/ loss and equity in foreign subsidiaries from average exchange rates in local currencies to the Group's functional currency.

	2021	2020
Market value of hedges
Currency hedges	-15	-8
Interest hedges	-2	-4
Recognised before tax	-17	-12
Tax on recognised hedge transactions	4	2
Hedging agreements after tax	-13	-10

Currency hedging agreements expire in maximum (number of months)	12	12
Interest hedging agreements expires in maximum (number of months)	60	72

Risk relating to raw materials

Risk on raw materials prices is not hedged by way of financial instruments.

31

Financial risk - continued

The Group's debt maturity profile:

				Cash flows including interest
2021	Carrying amount	Overdraft facilities without planned repayment	Less than 1 year	After one year through five years	More than 5 years	Total
Non-derivative financial instruments
Banks and other credit institutions	2,722	756	113	1,741	190	2,800
Lease debt	731	0	233	456	91	780
Trade payables	4,661	0	4,388	0	0	4,388
Other payables	1,737	0	1,516	386	0	1,902
Derivative financial instruments:
Forward currency contracts used as hedging instruments	21	0	18	2	0	21
Interest rate swaps used as hedging instruments	2	0	1	1	0	2
Recognised in balance sheet total	9,873	756	6,269	2,586	281	9,892
Contractual obligations to acquire non-current assets			382	14	0	396
Total liabilities		756	6,652	2,600	281	10,288

				Cash flows including interest
2020	Carrying amount	Overdraft facilities without planned repayment	Less than 1 year	After one year through five years	More than 5 years	Total
Non-derivative financial instruments
Banks and other credit institutions	1,856	601	79	1,019	219	1,917
Lease debt	743	0	207	511	82	800
Trade payables	3,479	0	3,479	0	0	3,479
Other payables	1,412	0	1,294	118	0	1,412
Derivative financial instruments:
Forward currency contracts used as hedging instruments	49	0	49	0	0	49
Interest rate swaps used as hedging instruments	4	0	2	2	0	4
Recognised in balance sheet total	7,542	601	5,110	1,650	301	7,661
Contractual obligations to acquire non-current assets			276	56	10	342
Total liabilities		601	5,386	1,706	311	8,003

32

Categories of financial assets and liabilities

Financial assets	2021	2020
Non-current assets
Other securities and investments (level 2)	90	79
Other securities and investments (level 3)	1	1
Financial assets at fair value through profit or loss	91	80
Other receivables	241	41
Receivables are measured at amortised cost.	241	41
Current assets
Trade receivables	4,726	3,781
Other receivables	291	221
Cash and cash equivalents	490	635
Receivables are measured at amortised cost.	5,507	4,638
Derivative financial instruments (level 2)	5	12
Hedging instruments measured at fair value	5	12
Financial liabilities
Non-current liabilities
Debt to mortgage-credit institutions	63	98
Other credit institutions	2,321	1,645
Other payables Financial liabilities at amortised cost	105 2,489	110 1,853

Contingent consideration (level 3) Financial liabilities at fair value through profit or loss	239 239	8 8

Current liabilities
Debt to mortgage-credit institutions	42	41
Other credit institutions Trade payables and other payables	1,027 6,293	816 4,772
Financial liabilities measured at amortised cost	7,362	5,629
Derivative financial instruments (level 2)	22	53
Hedging instruments measured at fair value	22	53

Level 1) Listed shares, stated at market value of shareholding

Level 2) Financial instruments valued by external credit institutions using generally accepted valuation techniques on the basis of observable data

Level 3) Unlisted shares and contingent consideration, stated at estimated value.

The fair value of financial assets and liabilities measured at amortised cost corresponds in all material respects to the carrying amount.

Securities measured at fair value through other comprehensive income (level 3) amounted to DKK 1 million at the beginning of the year and was unchanged at DKK 1 million at the end of the year.

The Group uses interest rate swaps and forward currency contracts to hedge fluctuations in the level of interest rates and foreign exchange rates. Forward exchange contracts and interest rate swaps are valued using generally accepted valuation techniques based on relevant observable swap curves and exchange rates (level 2). Other securities and investments forming part of a trading portfolio (level 2) includes the shareholding in Incuba A/S.

The fair value of derivative financial instruments is calculated by way of valuation models such as discounted cash flow models. Anticipated cash flows for individual contracts are based on observable market data such as interest rates and exchange rates. In addition, fair values are based on nonobservable market data, including exchange rate volatilities, or correlations between yield curves and credit risks. Non-observable market data account for an insignificant part of the fair value of the derivative financial instruments at the end of the reporting period.

Contingent consideration (earn-out) is measured at fair value on the basis of the income approach.

33

Fees to auditors appointed by the general meeting

	2021	2020

Statutory audit fees, PwC / (2020: EY)	11	10
Fees for other assurance engagements, PwC / (2020: EY)	0	1
Fees for tax and VAT-related services, PwC / (2020: EY)	0	1
Non-audit services, PwC / (2020: EY)	1	2
Total fees, PwC / (2020: EY)	12	14

Fees for non-audit services provided to Schouw & Co. by PwC mainly consisted of advisory services in relation to purchase price allocation in connection with acquisitions as well as other financial reporting and tax advisory services.

34 Earnings per share (DKK)

	2021	2020
Share of the profit for the year attributable to shareholders of Schouw & Co	1,038	912
Average number of shares	25,500,000	25,500,000
Weighted average number of treasury shares	-1,520,781	-1,526,501
Average number of outstanding shares	23,979,219	23,973,499

Average dilutive effect of outstanding share options *	99,393	25,349
Diluted average number of outstanding shares	24,078,612	23,998,848

Earnings per share of DKK 10	43.30	38.04
Diluted earnings per share of DKK 10	43.12	38.00

* See note 3 for information on options that may cause dilution.

35 Related party transactions

Under Danish legislation, Givesco A/S, Lysholt Allé 3, DK-7100 Vejle, members of the Board of Directors, key members of management as well as their family members are considered to be related parties. Related parties also comprise companies in which the individuals mentioned above have material interests. Related parties also comprise subsidiaries, joint arrangements and associates, see note 13 to the consolidated financial statements and note 10 to the parent company financial statements, in which Schouw & Co. has control, significant influence or joint control of as well as members of the boards of directors, management boards and senior management of those companies. For information about remuneration and option programmes for key members of management, see note 3.

	2021	2020
Joint ventures:
During the financial year, the Group sold goods in the amount of	3	11
During the financial year, the Group had interest income in the amount of	0	1
At 31 December, the Group had a receivable of	15	16
At 31 December, the Group had debt in the amount of	0	1
Associates:
During the financial year, the Group sold goods in the amount of	452	362
During the financial year, the Group bought goods in the amount of	96	84
At 31 December, the Group had a receivable of	184	158
At 31 December, the Group had debt in the amount of	23	11

During 2021, the Group traded with BioMar-Sagun, BioMar-Tongwei, LetSea and ATC Patagonia, Salmones Austral, LCL Shipping, Young Tech Co., Micron Specma India and NGIN. Other than as set out above, there were no transactions with related parties.

Schouw & Co. has registered the following shareholders as holding 5% or more of the share capital: Givesco A/S (28.09%), Direktør Svend Hornsylds Legat (14.82%) and Aktieselskabet Schouw & Co. (6.00%).

36

Events after the balance sheet date

After the end of the financial year, the critical development in the situation involving Ukraine have led to generally increased risks.

Other than as set out above, Schouw & Co. is not aware of events occurring after 31 December 2021 which are expected to have a material impact on the Group's financial position or outlook.

37

New financial reporting regulations

As of the date of publication of this annual report, the ISAB had issued a number of new and amended financial reporting standards and interpretations which are not mandatory for Schouw & Co. in 2021.

None of these new standards and interpretations are expected to have a material impact of recognition and measurement for Schouw & Co.

Adopted standards and improvements that have not yet come into force are implemented as and when they become mandatory for Schouw & Co. as per the EU effective dates.

In April 2021, IFRIC issued a clarification regarding configuration or customisation costs in a cloud computing arrangement. The clarification concerns the recognition of costs related to such arrangements, including whether cloud computing costs may be recognised as intangible assets under IAS 38.

Schouw & Co. has historically capitalised configuration and customisation costs related to such cloud computing arrangements. The implementation of the clarified guidelines may result in the reclassification of intangible assets so that they are either stated under prepayments or expensed in the income statement. Such reclassification may affect the presentation of intangible assets for both the year under review and previous years.

Schouw & Co. is currently assessing the effect of this IFRIC clarification and has not yet implemented the new guidelines. Schouw & Co. will implement the new guidelines in 2022 and, based on preliminary examinations, assesses that the change will reduce intangible assets by a maximum amount of DKK 15 million.

Parent company financial statements

91 Statements of income and comprehensive income
92 Balance sheet · Assets and liabilities
93 Cash flow statement
94 Statement of changes in equity
95 Notes · Basis of preparation of the parent company financial statements
96 Notes to the parent company financial statements
105 Statement by the Management Board and the Board of Directors
106 Independent auditors' report

Statements of income and comprehensive income

1 January – 31 December

Note	Income statement	2021	2020

1	Revenue	11.0	10.7
2, 24	Operating expenses	-50.5	-40.8
	EBITDA	-39.5	-30.1
3	Amortisation and depreciation	-0.7	-0.8
	EBIT	-40.2	-30.9

10	Recognition of share of profit in subsidiaries	1,002.0	878.7
	Gains from the sale of equity investments	3.2	2.0
13	Financial income	95.2	92.4
14	Financial expenses	-29.9	-34.1
	Profit before tax	1,030.2	908.0
20	Tax on profit/loss for the year	-4.5	-5.4
	Profit for the year	1,025.8	902.6

	Proposed distribution of profit
	Proposed dividend of DKK 15 per share (2020: DKK 14 per share)	382.5	357.0

Retained earnings 643.2 545.6 Profit for the year 1,025.8 902.6

Statement of comprehensive income	2021	2020
Items that can be reclassified to the income statement:
Value adjustment of subsidiaries	354.8	-528.4
Other comprehensive income after tax	354.8	-528.4

Profit for the year	1,025.8	902.6
Total recognised comprehensive income	1,380.6	374.2

Group information Group information

Our businesses

Management's report

Balance sheet · Assets and liabilities

at 31 December

Note	Assets	2021	2020

7	Intangible assets	1.4	0.8
8	Property, plant and equipment	18.6	18.6
9	Lease assets	0.4	0.4
10	Investments in subsidiaries	8,200.6	7,477.7
11	Securities	90.0	79.1
21	Deferred tax	7.6	7.3
12	Receivables from subsidiaries	649.5	949.7
	Other non-current receivables	0.8	0.0
	Total non-current assets	8,969.0	8,533.6
12	Receivables from subsidiaries	4,052.3	2,686.5
4	Receivables	13.5	14.9
	Cash and cash equivalents	1.0	106.1
	Total current assets	4,066.8	2,807.4

	Total assets	13,035.8	11,341.1

Note	Liabilities and equity	2021	2020

16	Share capital	255.0	255.0
	Reserve for net revaluation according to the equity method	4,181.0	3,447.0
	Retained earnings	5,843.0	5,565.0
	Proposed dividend	382.5	357.0
	Total equity	10,661.5	9,624.0

17	Other payables	16.5	17.0
15	Interest-bearing debt	1,678.4	1,061.0
	Non-current liabilities	1,694.8	1,078.0
15	Interest-bearing debt	656.0	618.9
6	Trade payables and other payables	20.1	16.9
22	Joint taxation contributions	3.1	1.9
23	Income tax	0.2	1.3
	Current liabilities	679.4	639.0
	Total liabilities	2,374.2	1,717.0

	Total equity and liabilities	13,035.8	11,341.1

Notes without reference 18, 19 and 25.

Cash flow statement

1 January – 31 December

Note	2021	2020
EBITDA	-39.5	-30.1
Adjustments for non-cash operating items etc.:
5 Changes in working capital	6.4	-5.0
Provisions	-0.8	-0.9
Other operating items, net	2.3	1.4
Cash flows from operations before interest and tax	-31.6	-34.6
Net interest received	54.3	56.2
22, Joint taxation contribution received and net tax paid 23	-4.9	-8.2
Cash flows from operating activities	17.8	13.4
Purchase of intangible assets	-0.8	0.0
Purchase of property, plant and equipment	-0.2	-0.1
Divestments	0.5	0.0
Dividend from subsidiaries	607.2	510.0
Additions/disposals of other financial assets	1.9	1.0
Cash flows from investing activities	608.6	510.9

	2021	2020

Loan financing:
Repayment of lease debt	-0.3	-0.3
Repayment of other non-current liabilities	-0.6	-0.5
Non-current debt raised	400.0	0.0
Change in bank overdrafts	237.9	-997.1
Change in intra-group balances	-1,048.8	873.8
Shareholders:
Dividends paid	-335.7	-335.7
Purchase of treasury shares	-5.9	0.0
Sale of treasury shares	0.0	10.7
Share-based payment	22.0	15.2
Cash flows from financing activities	-731.4	-433.8
Cash flows for the year	-105.1	90.6
Cash and cash equivalents, beginning of period	106.1	15.5
Value adjustment of cash and cash equivalents	0.0	0.0
Cash and cash equivalents, end of period	1.0	106.1

Statement of changes in equity

	Share capital	Reserve for net revaluation according to the equity method	Retained earnings	Proposed dividend	Shareholders' equity
Equity at 1 January 2020	255.0	3,571.6	5,336.2	357.0	9,519.8
Other comprehensive income in 2020
Value adjustment of subsidiaries		-528.4	0.0	0.0	-528.4
Profit for the year		878.7	-333.1	357.0	902.6
Total recognised comprehensive income	0.0	350.3	-333.1	357.0	374.2
Transactions with the owners
Share-based payment		0.0	19.6	0.0	19.6
Tax re. share-based payment		0.0	0.3	0.0	0.3
Value adjustment of put option in subsidiary		35.1	0.0	0.0	35.1
Distributed dividends		-510.0	531.3	-357.0	-335.7
Sale of treasury shares		0.0	10.7	0.0	10.7
Total transactions with owners during the year	0.0	-474.9	561.9	-357.0	-270.0
Equity at 31 December 2020	255.0	3,447.0	5,565.0	357.0	9,624.0
Other comprehensive income in 2021
Value adjustment of subsidiaries		354.8	0.0	0.0	354.8
Profit for the year		1,002.0	-358.8	382.5	1,025.8
Total recognised comprehensive income	0.0	1,356.8	-358.8	382.5	1,380.6
Transactions with the owners
Share-based payment		0.0	27.1	0.0	27.1
Tax re. share-based payment		0.0	-0.1	0.0	-0.1
Value adjustment of put option in subsidiary		-28.3	0.0	0.0	-28.3
Disposal of reserve for net revaluation due to sale of company		12.8	-12.8	0.0	0.0
Distributed dividends		-607.2	628.5	-357.0	-335.7
Purchase of treasury shares		0.0	-5.9	0.0	-5.9
Total transactions with owners during the year	0.0	-622.8	636.7	-357.0	-343.1
Equity at 31 December 2021	255.0	4,181.0	5,843.0	382.5	10,661.5

Notes · Basis of preparation of the parent company financial statements

In 2021, the income statement format has been changed from one classifying costs by function to one in which parent company's primary earnings measure, EBITDA, is presented directly in the income statement. Under this presentation method, depreciation and amortisation is shown in a single line item rather than being presented under three different functions. The previous three cost items classified by function, production costs, distribution costs and administrative expenses, have been combined in the item operating expenses. In the notes, operating expenses are presented in the most significant items by type.

With the exception of the mentioned changed income statement and cash flow statement presentation, Schouw & Co.'s parent company financial statements are consistent with those of last year.

Accounting policies

General reference is made to the description of accounting policies provided in the consolidated financial statements. Matters particular to the parent company are described in the following.

Changes in accounting policies

The parent company's accounting policies are consistent with those of last year.

Profit/loss from investments in subsidiaries

The proportionate share of the profit or loss of subsidiaries after tax is recognised in the income statement after full elimination of intra-group gains/losses.

Investments in subsidiaries

Investments in subsidiaries are measured at cost on initial recognition and subsequently at the proportionate share of the companies' net asset value calculated in accordance with the parent company's accounting policies with the deduction or addition of unrealised intra-group gains and losses and with the addition or deduction of goodwill calculated according to the purchase method.

Companies with a negative net asset value are recognised at DKK nil, and any receivable amount from these companies is written down, to the extent it is deemed to be irrecoverable, by the parent company's share of the negative net asset value. If the negative net asset value exceeds the amount receivable, the residual amount is recognised under provisions to the extent that the parent company has a legal or constructive obligation to cover the subsidiary's negative balance.

The net revaluation of investments is taken to the reserve for net revaluation according to the equity method to the extent the carrying amount exceeds cost.

Newly acquired or newly established companies are recognised in the financial statements from the date of acquisition.

Enterprises disposed of or wound up are recognised until the date of disposal.

Securities

Security holdings which do not enable the company to exercise control or a significant influence are measured at fair value. Securities for which changes in fair value are regularly monitored, are recognised under financial items in the income statement when they occur.

Shareholders' equity

Reserve for net revaluation according to the equity method contains the accumulated change of investments in subsidiaries, joint ventures and associates from the date of acquisition until the balance sheet date and expresses the accumulated change in value of the investment while in the Group's ownership. The purchase and sale sums of treasury shares and dividends thereon are taken directly to retained earnings under equity.

Treasury shares

Proceeds from the sale of treasury shares in Schouw & Co. in connection with the exercise of share options or employee shares are taken directly to equity.

Dividend

2 Operating expenses

	2021	2020

Staff costs	-38.6	-31.9
Other operating expenses	-11.9	-9.0
Total operating expenses	-50.5	-40.8
Staff costs
Remuneration to the Board of Directors of Schouw & Co.	-3.4	-3.4
Wages and salaries	-28.0	-22.2
Defined contribution pension plans	-2.0	-1.8
Other social security costs	-0.1	-0.1
Share-based payment	-5.0	-4.4
Total staff costs	-38.6	-31.9

Average no. of employees	15	14

For more information on salaries, pensions and share-based payment to the Executive Management of Schouw & Co., see note 3 to the consolidated financial statements. Staff costs including sharebased payment are recognised under administrative expenses.

3

Amortisation and depreciation

	2021	2020
Amortisation and depreciation
Amortisation of intangible assets	-0.2	-0.2
Depreciation of property, plant and equipment	-0.2	-0.4
Depreciation of lease assets	-0.3	-0.3
Total amortisation/depreciation	-0.7	-0.8

4

Receivables

	2021	2020

Other current receivables	0.8	1.9
Prepayments	12.7	13.0
Total receivables	13.5	14.9

No impairment losses were recognised on receivables during the year.

5

Changes in working capital

	2021	2020

Change in receivables	1.4	-8.3
Change in trade payables and other payables	5.0	3.4
Total changes in working capital	6.4	-5.0

Our businesses

Trade payables and other payables
-----------------------------------	--	--

	2021	2020

Trade payables	1.0	0.5
Other payables	19.1	16.4
Total trade payables and other payables	20.1	16.9

7 Intangible assets

2021	IT projects	Total
Cost at 1 January 2021	1.0	1.0
Additions	0.8	0.8
Disposals	0.0	0.0
Cost at 31 December 2021	1.8	1.8
Amortisation and impairment at 1 January 2021	-0.2	-0.2
Amortisation	-0.2	-0.2
Amortisation and impairment at 31 December 2021	-0.4	-0.4

Carrying amount at 31 December 2021	1.4
2020	IT projects
Cost at 1 January 2020	1.0
Additions	0.0
Disposals	0.0
Cost at 31 December 2020	1.0	1.4 Total 1.0 0.0 0.0 1.0

Amortisation and impairment at 1 January 2020	0.0	0.0
Amortisation Amortisation and impairment at 31 December 2020	-0.2 -0.2	-0.2 -0.2

The parent company has entered into an agreement to purchase intangible assets for an amount of DKK 1.3 million to be delivered in 2022.

8

Property, plant and equipment

	Land and	Other fixtures and fittings, tools and
2021	buildings	equipment	Total
Cost at 1 January 2021	19.0	6.8	25.8
Additions	0.1	0.1	0.2
Disposals	0.0	-0.2	-0.2
Cost at 31 December 2021	19.1	6.7	25.8
Depreciation and impairment at 1 January 2021	-2.9	-4.2	-7.2
Depreciation and impairment of assets disposed of	0.0	0.2	0.2
Depreciation	0.0	-0.2	-0.2
Depreciation and impairment at 31 December 2021	-3.0	-4.2	-7.2
Carrying amount at 31 December 2021	16.2	2.4	18.6
2020	Land and buildings	Other fixtures and fittings, tools and equipment	Total
Cost at 1 January 2020	19.0	6.8	25.8
Additions	0.0	0.1	0.1
Disposals	0.0	-0.1	-0.1
Cost at 31 December 2020	19.0	6.8	25.8
Depreciation and impairment at 1 January 2020	-2.9	-4.0	-7.0
Depreciation and impairment of assets disposed of	0.0	0.1	0.1
Depreciation	0.0	-0.3	-0.4
Depreciation and impairment at 31 December 2020	-2.9	-4.2	-7.2
Carrying amount at 31 December 2020	16.0	2.6	18.6

The parent company has entered into an agreement to purchase property plant and equipment for an amount of DKK 1.4 million to be delivered in 2022.

At 31 December 2021, Schouw & Co. owned the property at Chr. Filtenborgs Plads 1, Aarhus, which is the Group's head office, and an undeveloped site at Lystrup, Denmark.

The Board of Directors and the Executive Management have considered and approved the annual report for the 2021 financial year.

Lease assets

2021	Cars	Total
Cost at 1 January 2021	0.9	0.9
Additions	0.3	0.3
Disposals	0.0	0.0
Cost at 31 December 2021	1.2	1.2

Depreciation and impairment at 1 January 2021	-0.5	-0.5
Depreciation	-0.3	-0.3
Depreciation and impairment at 31 December 2021	-0.8	-0.8

Carrying amount at 31 December 2021	0.4	0.4

2020	Cars	Total
Cost at 1 January 2020	0.9	0.9
Additions	0.0	0.0
Disposals	0.0	0.0
Cost at 31 December 2020	0.9	0.9

Depreciation and impairment at 1 January 2020	-0.2	-0.2
Depreciation	-0.3	-0.3
Depreciation and impairment at 31 December 2020	-0.5	-0.5

Carrying amount at 31 December 2020	0.4	0.4

The parent company has entered into an agreement to lease assets for an amount of DKK 0.4 million to be delivered in 2022.

10

Investments in subsidiaries

The parent company has the following subsidiaries:

Name	Registered office	Ownership interest 2021	Ownership interest 2020
BioMar Group A/S	Aarhus, Denmark	100%	100%
Fibertex Personal Care A/S	Aalborg, Denmark	100%	100%
Fibertex Nonwovens A/S	Aalborg, Denmark	100%	100%
GPV International A/S	Vejle, Denmark	100%	100%
HydraSpecma A/S	Skjern, Denmark	100%	100%
Borg Automotive A/S	Silkeborg, Denmark	100%	100%
Alba Ejendomme A/S	Aarhus, Denmark	0%	100%

	2021	2020

Cost at 1 January	4,030.7	4,030.7
Disposals for the year	-11.1	0.0
Cost at 31 December	4,019.6	4,030.7
Adjustments at 1 January	3,447.0	3,571.6
Disposals for the year	12.8	0.0
Share of profit for the year	1,002.0	878.6
Dividends paid	-607.2	-510.0
Other capital entries	326.5	-493.3
Adjustments at 31 December	4,181.1	3,447.0
Carrying amount at 31 December	8,200.6	7,477.7

Of which carrying amount of goodwill	1,026.0	1,026.0

Schouw & Co. has tested investments, including goodwill in subsidiaries, for impairment. The impairment tests did not result in investments being written down.

The company Alba Ejendomme A/S was sold in 2021.

11

Securities

	2021	2020

Cost at 1 January	43.0	43.1
Disposals	0.0	0.0
Cost at 31 December	43.0	43.0

Adjustments at 1 January	36.1	33.0
Dividends received	-0.7	-0.7
Disposals	0.0	-1.0
Adjustments recognised in the income statement	11.6	4.8
Adjustments at 31 December	46.9	36.1

Carrying amount at 31 December 90.0 79.1

Securities consist mainly of a 15.8% shareholding in Incuba A/S.

12

Receivables from subsidiaries

	2021	2020

Receivables from subsidiaries – non-current	649.5	949.7
Receivables from subsidiaries – current	4,052.3	2,686.5
Total receivables from subsidiaries	4,701.8	3,636.2
Breakdown of receivables from subsidiaries:
Interest-bearing receivables	4,701.8	3,636.2
Non-interest-bearing receivables	0.0	0.0
Total receivables from subsidiaries	4,701.8	3,636.2

Most of the financing of subsidiaries is made through the parent company Schouw & Co. by way of a structure of intra-group loans through cash pools. For receivables which mature within 12 months after the end of the financial year, the nominal value is estimated to correspond to the fair value. The parent company has not made provisions for losses on receivables from subsidiaries in the cash pool agreement. As the subsidiaries generate good earnings and are solid financially, provisions for losses are not considered necessary. Historically, the company has had no losses on loans to subsidiaries.

13

Financial income

	2021	2020

Interest income from subsidiaries	81.9	86.4
Foreign exchange adjustments	0.3	1.0
Fair value adjustment of financial assets	11.6	4.8
Other interest income	1.3	0.2
Total financial income	95.2	92.4

14

Financial expenses

	2021	2020

Interest payable to subsidiaries	-0.1	-0.3
Interest expense on financial liabilities	-29.1	-33.6
Foreign exchange adjustments	-0.7	-0.2
Total financial expenses	-29.9	-34.1

15

Interest-bearing debt

	2021	2020
Credit institutions (non-current)	1,675.1	1,057.2
Mortgage debt (non-current)	3.0	3.6
Lease debt (non-current)	0.2	0.2
Total recognised as non-current interest-bearing debt	1,678.4	1,061.0
Current portion of non-current liabilities	0.8	0.8
Amounts owed to subsidiaries	655.2	618.1
Total recognised as current interest-bearing debt	656.0	618.9
Total interest-bearing debt	2,334.4	1,679.9

The fair value of interest-bearing debt corresponds in all material respects to the carrying amount.

Interest-bearing debt (continued)

Maturity profile of interest-bearing debt, including lease debt:

	2021		2020
	Interest-bear	of which lease	Interest-bear	of which lease
	ing debt	debt	ing debt	debt
Principal repayment
Overdraft facilities and debt to subsidiaries	655.2		618.1
Less than 1 year	19.7	0.2	14.0	0.3
1-5 years	1,542.6	0.2	894.0	0.2
More than 5 years	181.0	0.0	203.1	0.0
Total	2,398.6	0.5	1,729.2	0.4

Interest
Overdraft facilities and debt to subsidiaries	0.0		0.0
Less than 1 year	18.9	0.0	13.2	0.0
1-5 years	42.9	0.0	35.3	0.0
More than 5 years	2.4	0.0	0.8	0.0
Total	64.2	0.0	49.3	0.0
Carrying amount
Overdraft facilities and debt to subsidiaries	655.2		618.1
Less than 1 year	0.8	0.2	0.8	0.3
1-5 years	1,499.8	0.2	858.7	0.2
More than 5 years	178.6	0.0	202.3	0.0
Total	2,334.4	0.4	1,679.9	0.4

Spot rate used for floating rate loans.

The weighted average effective rate of interest for the year was 1.5% (2020: 1.5%).

The weighted average effective rate of interest at the balance sheet date was 0.8% (2020: 0.7%).

Percentage breakdown of interest-bearing debt by currency

Interest rate risk

The parent company hedges parts of the interest rate risk on its debt subject to a case-by-case assessment. Such assessments include, in addition to expectations for interest rate developments, the amount of the total floating rate debt relative to equity. Hedging consists of interest rate swaps.

Interest profile of interest-bearing debt

An increase in interest rates of 1 percentage point would cause the annual interest expense to increase by DKK 15.3 million after tax (2020: DKK 10.2 million). A decrease in interest rates of 1 percentage point would cause the annual interest expense to decrease by DKK 15.3 million after tax (2020: DKK 10.2 million). The effect on equity would be identical to the effect on profit/loss. Fixed rate debt consists only of items, for which the rate of interest will not be reset within the next 12 months.

To ensure that the company always has the necessary capital resources to capitalise on opportunities for investment that may arise and to be able to settle obligations agreed, the company has entered into a number of agreements with financial institutions, under which they provide credit lines to Schouw & Co. It is company policy to diversify borrowings on short term drawing facilities and long-term loans from an assessment of its current leverage. The company's capital resources consist

Credit lines 3,275.0 4,275.0 Operating credits drawn -263.7 -45.2 Guarantee commitments deducted from the credit line -124.3 0.0 Amount drawn in subsidiaries which is deducted from the credit line -214.8 0.0 Cash and cash equivalents 1.0 106.1 Current loans to subsidiaries 4,052.3 2,686.5 Current debt to subsidiaries -655.2 -618.1 Parent company's net position including credit facilities 6,070.3 6,404.3

Credit facilities currently utilised by subsidiaries, net -3,397.1 -2,068.4 Parent company's cash resources 2,673.2 4,335.9

The parent company Schouw & Co.'s financing consists mainly of a syndicated bank facility, which in December 2020 was refinanced with a total facility line of DKK 3,275 million. The facility has a three-year term with an option for a one-year extension after the first and second year. In connection with refinancing the bank facility, the international bank Hongkong & Shanghai Banking Corporation (HSBC) joined the existing bank consortium consisting of Danske Bank, DNB and Nordea. The first

of cash, short-term receivables from subsidiaries and undrawn credit facilities.

Capital resources

Interest-bearing debt (continued)

extension option was utilised in December 2021.

ments and development costs.

16

2021 2020

Share capital

The share capital consists of 25,500,000 shares with a nominal value of DKK 10 each. All shares rank equally.

The share capital is fully paid up. Each share carries one vote, for a total of 25,500,000 voting rights.

Treasury shares	Number of shares	Nominal value	Cost	Percentage of share capital
1 January 2020	1,544,280	15,442,800	468.9	6.06%
Share option programme	-23,556	-235,560	-3.4	-0.09%
31 December 2020	1,520,724	15,207,240	465.5	5.96%

Purchase of treasury shares	10,378	103,780	5.9	0.04%
31 December 2021	1,531,102	15,311,020	471.5	6.00%

In 2021, Schouw & Co. acquired shares for DKK 5.9 million to be held in treasury. The purchase was part of a programme under which Schouw & Co. intends to buy back shares held in treasury for a total amount of DKK 350 million in the period from 27 December 2021 to 30 December 2022.

Schouw & Co. has been authorised by the shareholders in general meeting to acquire up to 5,100,000 treasury shares, equal to 20.0% of the share capital. The authorisation is valid until 01 April 2025.

The share capital has not changed in the past five years.

Management's report

17 Other payables

	2021	2020

Pension liabilities Frozen holiday funds payable	15.1 0.0	16.0 1.1
Loan to cover employee income taxes	1.3	0.0
Total other payables	16.5	17.0
Pension liabilities
Net liability at 1 January	16.0	16.9
Paid out	-0.8	-0.9
Net liability at 31 December	15.1	16.0

It is company policy to fund all pension liabilities, so as predominantly to avoid defined benefit plans. However, as part of the merger with BioMar Holding, Schouw & Co. assumed a defined benefit obligation.

The pension obligation was calculated at DKK 15.1 million at 31 December 2021. The entire amount relates to the liability to ensure the entitlements to receive supplementary pensions in accordance with the previous practise of the KFK pension funds. The entire obligation is related to people who were on the labour market at 30 September 2002 and who transferred to employment with the consortium that took over the divested grain and feed operations (the former KFK). Some uncertainty applies as to the amount of the pension obligation. Accordingly, final coverage of this liability may impact future financial results in a positive or a negative direction.

18

Contingent liabilities and guarantees

Contingent liabilities

The company is taxed jointly with the other Danish group companies. As a management company, the company is joint and severally liable with the other Danish group companies for Danish corporate income tax and withholding tax on dividends, interest and royalties within the joint taxation pool.

Guarantees

The following assets have been provided as security to credit institutions:

Land and buildings with a carrying amount of DKK 16.2 million (2020: DKK 16.0 million).

The collateral set out above represents the parent company's debt to mortgage-credit institutions of DKK 3.6 million (2020: DKK 4.1 million).

19

Financial risk

The parent company's risk management policy

Due to the nature of its operations, investments and financing, the parent company is exposed primarily to changes in the level of interest rates. Interest rate risks are described in greater detail in the note on interest-bearing debt. The parent company's financial management exclusively involves the management of financial risk relating to operations and investment.

Currency risk

The parent company's currency risks mainly relate to its subsidiaries' foreign business operations. The parent company does not hedge these investments.

The parent company's currency risk exposure at 31 December 2020 was limited to EUR-denominated net debt of DKK 545 million and as such not subject to any material currency risk.

Credit risk

The parent company credit risk relates primarily to receivables from subsidiaries and secondarily to cash deposits.

20

Tax on profit/loss for the year

	2021	2020

Tax on the profit for the year is specified as follows:
Tax on profit/loss for the year	-4.5	-5.4
Tax on other comprehensive income	0.0	0.0
Total tax	-4.5	-5.4
Tax on the profit for the year has been calculated as follows:
Current tax	-4.9	-6.2
Deferred tax	0.5	0.8
Total tax recognised in the income statement	-4.5	-5.4
Specification of the tax on the profit for the year:
Calculated 22% tax of profit/loss before tax	-226.7	-199.8
Tax effect of non-deductible costs	-1.5	-1.0
Tax effect of non-taxable income	223.7	195.4
Total tax recognised in the income statement	-4.5	-5.4
Effective tax rate	0.4%	0.6%

Non-taxable income relate primarily to non-deductible income from investments in subsidiaries.

Tax on items recognised in other comprehensive income – 2021	Before tax	Taxation	After tax
Value adjustment of subsidiaries	354.8	0.0	354.8
Total tax on items recognised in other comprehensive income	354.8	0.0	354.8

Tax on items recognised in other comprehensive income – 2020 Before tax Taxation After tax Value adjustment of subsidiaries 528.4 0.0 528.4 Total tax on items recognised in other comprehensive income 528.4 0.0 528.4

21

Deferred tax

	2021	2020

Deferred tax at 1 January	-7.3	-6.2
Deferred tax for the year recognised in profit/loss for the year	-0.5	-0.8
Deferred tax for the year recognised in equity	0.1	-0.3
Deferred tax at 31 December, net	-7.6	-7.3

Deferred tax pertains to:
Intangible assets	-0.2	0.1
Property, plant and equipment	-0.3	-0.5
Shareholders' equity	-0.1	-0.3
Other liabilities	-7.0	-6.6
Deferred tax at 31 December, net	-7.6	-7.3

All deferred tax assets and tax liabilities are recognised in the balance sheet.

	Balance at	Recognised in the	Recognised	Balance at
Change in deferred tax	1 January	profit for the year	in equity	31 December
Intangible assets	0.1	-0.4	0.0	-0.2
Property, plant and equipment	-0.5	0.2	0.0	-0.3
Shareholders' equity	-0.3	0.0	0.1	-0.1
Other liabilities	-6.6	-0.3	0.0	-7.0
Total change in deferred tax	-7.3	-0.5	0.1	-7.6

2020

2021

Change in deferred tax	Balance at 1 January	Recognised in the profit for the year	Recognised in equity	Balance at 31 December
Intangible assets	0.2	-0.1	0.0	0.1
Property, plant and equipment	-0.7	0.2	0.0	-0.5
Shareholders' equity	0.0	0.0	-0.3	-0.3
Other liabilities	-5.7	-0.9	0.0	-6.6
Total change in deferred tax	-6.2	-0.8	-0.3	-7.3

22

Joint taxation contributions

	2021	2020

Joint taxation contributions at 1 January	1.9	5.2
Adjustment related to prior years	-1.1	1.1
Current tax for the year	-73.8	-55.2
Joint taxation contributions received/paid	76.1	50.8
Total joint taxation contributions	3.1	1.9
which is specified as follows:
Joint taxation contribution receivable	0.0	0.0
Joint taxation contributions payable	3.1	1.9
Total joint taxation contributions	3.1	1.9

24

Fees to auditors appointed by the shareholders

	2021	2020

Statutory audit fees, PwC / (2020: EY)	0.4	0.3
Fees for tax and VAT-related services, PwC / (2020: EY)	0.1	0.1
Non-audit services, PwC / (2020: EY)	0.0	0.4
Total fees, PwC / (2020: EY)	0.5	0.8

25

Related party transactions

23 Income tax

	2021	2020

Income tax payable at 1 January	1.3	0.0
Current tax for the year	4.9	6.2
Adjustment related to prior years	1.1	-1.1
Current tax for the year from jointly taxed companies	73.8	55.2
Income tax paid during the year	-81.0	-59.0
Total income tax	0.2	1.3
which is specified as follows:
Income tax receivable	0.0	0.0
Income tax payable	0.2	1.3
Total income tax	0.2	1.3

Related parties are described in the note "Related party transactions" to the consolidated financial statements.

Management's remuneration and share option programmes are set out in the note "Costs" to the consolidated financial statements.

	2021	2020

Subsidiaries:
During the year, the parent company received a management fee of	11.0	10.7
During the year, the parent company received interest income of	81.9	86.4
During the year, the parent company paid interest expenses amounting to	0.1	0.3
At 31 December the parent company had a receivable of	4,701.8	3,636.2
At 31 December ,the parent company had debt amounting to	655.2	618.1
During the year, the parent company received dividends of	607.2	510.0

Other than as set out above, there were no transactions with related parties.

Management Statement

To the shareholders of Aktieselskabet Schouw & Co.

The annual report has been prepared in accord ance with the International Financial Reporting Standards as adopted by the EU and additional Danish disclosure requirements for annual reports.

In our opinion, the consolidated and parent company financial statements give a true and fair view of the Group's and the parent com pany's assets, liabilities and financial position at 31 December 2021 and of the results of the Group's and the parent company's operations and cash flows for the financial year ended 31 December 2021.

In our opinion, the management's report in cludes a fair review of the development and per formance of the Group and the parent company, the financial results and cash flows for the year and of the financial position, together with a de scription of the principal risks and uncertainties that the Group and the parent company face.

In our opinion, the consolidated financial state ments of Aktieselskabet Schouw & Co. for the financial year ended 31 December 2021 with the file name "Schouw-2021-12-31-da.zip" has been prepared, in all material respects, in compliance with the ESEF Regulation.

We recommend that the annual report be adopted by the shareholders at the annual general meeting.

Aarhus, 4 March 2022 Executive Management Jens Bjerg Sørensen Peter Kjær President and CEO Board of Directors Jørn Ankær Thomsen Jørgen Wisborg Kjeld Johannesen Chairman Deputy Chairman

Agnete Raaschou-Nielsen Hans Martin Smith Kenneth Skov Eskildsen

Parent company statements Parent company statements

Independent Auditor's Reports

To the shareholders of Aktieselskabet Schouw & Co.

Report on the audit of the Financial Statements

Our opinion

In our opinion, the Consolidated Financial State ments and the Parent Company Financial State ments give a true and fair view of the Group's and the Parent Company's financial position at 31 December 2021 and of the results of the Group's and the Parent Company's operations and cash flows for the financial year 1 January to 31 December 2021 in accordance with Interna tional Financial Reporting Standards as adopted by the EU and further requirements in the Danish Financial Statements Act.

Our opinion is consistent with our Auditor's Long-form Report to the Audit Committee and the Board of Directors.

What we have audited

The Consolidated Financial Statements and Parent Company Financial Statements of Aktieselskabet Schouw & Co. for the financial year 1 January to 31 December 2021 comprise income statement and statement of comprehensive income, balance sheet, statement of changes in equity, cash flow statement and notes, including summary of significant accounting policies for the Group as well as for the Parent Company. Collectively referred to as the "Financial Statements".

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs) and the additional requirements applicable in Denmark. Our responsibilities under those standards and requirements are further d escribed in the Auditor's responsibilities for the audit of the Financial Statements section 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 the Group in accordance with the International Ethics Standards Board for Accountants' International Code of Ethics for Professional Accountants (IESBA Code) and the additional ethical requirements applicable in Denmark. We have also fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code.

To the best of our knowledge and belief, prohibited non-audit services referred to in Article 5(1) of Regulation (EU) No 537/2014 were not provided.

Appointment

We were first appointed auditors of Aktieselska-

bet Schouw & Co. on 15 April 2021 for the financial year 2021.

Key audit matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the Financial Statements for 2021. These matters were addressed in the context of our audit of the Financial Statements as a whole, and in forming our opinion thereon,

Key audit matter	How our audit addressed the key audit matter
Trade receivables	We reviewed and tested the statement of provisions for losses on trade receivables in
Trade receivables in BioMar face a particular risk of loss, as BioMar's industry and	BioMar prepared by Management. As part of this work, we tested, on a sample basis,
geographical segments are subject to an increased risk of loss on trade receivables.	the ageing of receivables and payments received after the balance sheet date.
Assessing the need for impairment of trade receivables in BioMar involves	On a sample basis, we tested the assumptions underlying Management's estimates
significant estimates in terms of determining the customers' ability to pay, the	by reviewing, for example, correspondence with customers and lawyers as well as
expected payment date and the value of any security provided.	payment history.
We focused on this area due to the accounting estimates being inherently	On a sample basis we tested security provided and reviewed Management's assessment
subjective, which implies a significant degree of estimation uncertainty.	of the measurement of such security.
We refer to note 7 of the Consolidated Financial Statements.	Moreover, we assessed the historical accuracy of Management's estimates by comparing the estimated provision for bad debt in the previous year to subsequent actual losses recognised.
	We reviewed and assessed the presentation and disclosure of impairment losses on trade receivables in the notes.
Goodwill	We reviewed and tested the impairment tests carried out by Management. As part of
Goodwill may be impaired by, for example, increased competition in local markets,	this, we assessed whether the estimates and judgements made by Management in
changes in the global economy and strategy changes in the Group.	carrying out these tests were reasonable.
Impairment of goodwill involves significant estimates and judgements by Manage	Our audit procedures included an assessment of the impairment model used. We
ment, including the determination of significant assumptions relating to revenue	focused particularly on the significant assumptions relating to the determination of future
growth, earnings development and investments during the budget and forecast	cash flows, including revenue growth, earnings development and investments during the

We focused on impairment testing of goodwill, as the accounting estimates are complex and the determination of significant assumptions is inherently subjective.

We refer to note 16 of the Consolidated Financial Statements.

period, as well as long-term growth rates and discount rates.

budget and forecast period, as well as long-term growth rates and discount rates.

We reviewed sensitivity analyses of changes in earnings and discount rates.

Furthermore, we assessed the historical accuracy of Management's estimates by comparing the 2021 budget with the results realised.

We reviewed and assessed the presentation and disclosure of impairment tests in the notes.