Notes to the financial statements

1. ACCOUNTING PRINCIPLES

1.1. VALUATION PRINCIPLES

Fixed assets are stated at historical cost less accumulated straight-line depreciation. Current assets are stated at historical cost or at lower fair value. Foreign currency items are translated using the exchange rate at the balance sheet date. The consolidated financial statements are presented in equal euros (EUR).

Forcit Defence International Ab’s operations include projects whose manufacturing time is long. The company applies the principles of partial revenue recognition in its project operations where the project’s manufacturing time spans several accounting periods and where the project’s amounts are significant with regards to turnover. The income is recognized in the profit and loss account according to the progress of the projects (percentage of completion). The long-term project’s recognition is determined on the basis of manufactured goods in relation to the total quantity of ordered goods for the project. The costs for the projects are based on the project accounting where each project has its own project cost calculation. The costs for the projects include variable expenses for procurement and manufacturing. The partial revenue recognition reflects the significant growth in the project business during the financial year and improves the comparability between financial years.

1.2. DEPRECIATION AND AMORTISATION

Depreciation is calculated from the historical cost, and is calculated on a straight-line basis over the estimated economic life on the asset. The basis of calculation are:

Buildings and constructions20-50
Machinery and equipment5-10
Other tangible assets10-20
Immaterial rights5-10
Other long-term expense items10
Consolidated goodwill5-10

1.3. CONSOLIDATED FINANCIAL STATEMENTS

The consolidated financial statements include the parent company Oy Forcit Ab and the subsidiary companies Forcit Sweden AB, Forcit Norway AS, Forcit International Oy Ab, Forcit Defence International Oy Ab, Forcit Consulting Oy, Forcit Consulting AB, Forcit Consulting AS, O-Piblast S.A. and Forcit Ireland Ltd. The consolidated financial statements also include the associated company Vipnordic AB. Vipnordic AB’s financial statements are prepared per 31.08.2022. The consolidated financial statement is prepared according to the acquisition method. All intercompany transactions, balances, gains and losses are eliminated as part of the consolidation process. Forcit Defence International Oy Ab is part of the group as of 11.5.2023. During the financial year, 45% of the subsidiary O-Pitblast S.A. was sold and the ownership share of Vipnordic AB rose to 50%.

2. PROFIT AND LOSS ACCOUNT
2.1. NET SALES PER BUSINESS SECTOR
Consolidated20232022
Explosives194 037211 010
Consulting15 14817 332
Revenue recognition5 1550
Total214 340228 342
Parent Company20232022
Explosives107 395112 676
Revenue recognition2 4470
Total109 841112 676
2.2. SALARIES FOR THE REPORTING PERIOD AND THE AVERAGE NUMBER OF PERSONNEL
Consolidated20232022
Boards of Directors and CEO´s1 6231 631
Other personnel32 59630 841
Total34 21932 472
Parent Company20232022
Boards of Directors and CEO´s817644
Other personnel17 75115 778
Total18 56816 423
During the financial period the average number of personnel20232022
Consolidated553533
Parent Company288265
2.3. OTHER OPERATING INCOME
Consolidated20232022
Income from rents160166
Return08
Other items2 422527
Total2 583701
Parent Company20232022
Intra-group transactions2 9052 886
Income from rents160166
Return08
Other items1 029164
Total4 0953 223
2.4. AUDIT FEES
Consolidated20232022
Audit fees174154
Total174154
Parent Company20232022
Audit fees7742
Total7742
2.5. APPROPRIATIONS
Parent Company20232022
Group contribution7 1101 394
2.6. DIVIDEND INCOME FROM GROUP
UNDERTAKINGS
Parent Company20232022
Dividend income from group undertakings6 9172 908
2.7. INCOME TAX
Consolidated20232022
Income tax on ordinary items56674 707
Change in deferred tax liability48-13
Total57154 694
Parent Company20232022
Income tax on group contributions1422279
Income tax on ordinary items26322 555
Total40542 834
3. BALANCE SHEET
3.1. INTANGIBLE AND TANGIBLE ASSETS
The notes include the purchase cost for the non-current assets that have not entirely been depreciated by plan. The goodwill in the consolidated Financial Statements is depreciated over a period of 5–10 years from acquisition.

Consolidated20232022
Acquisition cost 1.1.153 987142 543
Increases28 09511 606
Decreases-2 187-162
Acquisition cost 31.12.179 894153 987
Accumulated depreciation 1.1.-95 979-87 230
Depreciation for the reporting period-8 863-8 811
Accumulated depreciation on reductions43961
Accumulated depreciation 31.12.-104 403-95 979
Increases437437
Book value on 31.12.75 92958 445
Balance value of intangible and tangible assets in production18 24013 586
Parent Company20232022
Acquisition cost 1.1.82 62376 770
Increases19 3475 877
Decreases-76-25
Acquisition cost 31.12.101 89482 623
Accumulated depreciation 1.1.-51 668-48 324
Depreciation for the reporting period-3 400-3 344
Accumulated depreciation 31.12.-55 068-51 668
Increases437437
Book value on 31.12.47 26331 392
Balance value of intangible and tangible assets in production6 3916 359
3.2. INVESTMENTS, PARENT COMPANY
SharesGroup companiesOthersTotal
Acquisition cost 1.1.24 94028725 227
Increases2 23602 236
Decreases-2 3960-2 396
Acquisition cost 31.12.24 78028725 067
3.3. STOCKS
Consolidated20232022
Raw materials and consumables18 27811 829
Finished products2 0544 705
Purchased products9 9579 701
Advances paid12 542171
Total42 83126 407
Parent Company20232022
Raw materials and consumables16 97310 197
Finished products4213 149
Purchased products3 7954 005
Advances paid12 541171
Total33 73117 523
3.4. CONSOLIDATED COMPANIES
Participation-%ConsolidatedParent Company
Forcit International Oy Ab100100
Forcit Defence International Oy Ab *)100100
Forcit Sweden AB100100
Forcit Norway AS100100
Forcit Consulting Oy100100
Forcit Consulting AB100100
Forcit Consulting AS100100
Forcit Ireland Ltd100100
O-Pitblast S.A. **)5555
Vipnordic AB ***)5050
*) The company is part of the group as of 11.5.2023.
**) 45% of the company is sold in January 2023.
***) Ownership of the company rose to 50% from 33.33%.
3.5. CONSOLIDATED RECEIVABLES AND PAYABLES
Parent Company20232022
Long-term loan receivables243243
Trade receivables7 8786 082
Loan receivables75126
Other receivables*14 5028 773
Total receivables22 69815 223
Trade payables19538
Other debts*31 75212 325
Total payables31 94712 363
*Refers mainly to cash pool arrangements
3.6. CHANGES IN EQUITY
Consolidated20232022
Share Capital 1.13 1493 149
Share Capital 31.12.3 1493 149
Reserve for invested unrestricted equity 1.11 5011 501
Reserve for invested unrestricted equity 31.121 5011 501
Disposition fund 1.134 06033 183
Profit last year21 5296 069
Dividend for last year-5 034-3 423
Change in disposition fund-319-1 768
Disposition fund 31.12.50 23634 060
Net profit for the period20 53421 529
Total equity75 41960 238
Parent Company20232022
Share Capital 1.13 1493 149
Share Capital 31.12.3 1493 149
Reserve for invested unrestricted equity 1.11 5011 501
Reserve for invested unrestricted equity 31.121 5011 501
Disposition fund 1.128 57624 510
Profit last year14 0467 489
Dividend for last year-5 034-3 423
Disposition fund 31.12.37 58828 576
Net profit for the period23 06914 046
Total equity65 30747 271
Distributable free funds in total 31.12.62 15844 123
3.7. APPROPRIATIONS AND DEFERRED TAX LIABILITIES
Accumulated depreciation in excess on plan
Parent Company20232022
Intangible assets
Intangible rights751751
Tangible assets
Buildings and constructions4 3634 284
Machinery and equipment3 3163 313
Other tangible assets12
Total8 4328 349
Deferred tax liability
The deferred tax liability from the depreciation in excess on plan and accrual reserve have been separated in the consolidated financial statements
20232022
Consolidated3 3383 289
The remaining depreciation difference and accrual reserve have been booked as unrestricted shareholders’ equity.
20232022
Consolidated12 09312 143
3.8. CURRENT LIABILITIES
The balance sheet item “Loans from financial institutions” also includes use of current account with overdraft facility.
20232022
Consolidated2 1062 667
Parent Company2 1062 667
3.9. ACCRUED EXPENCES AND ADVANCES RECEIVED
Assets
Consolidated20232022
Periodic invoices838541
Tax refund160
Accrued income according to revenue recognition principles5 1550
Other06
Total6 009547
Parent Company20232022
Periodic invoices28588
Total28588
Equity and liabilities
Consolidated20232022
Accrued personnel costs6 1755 462
Other accruals3 2933 289
Reservation for long-term projects1430
Interests3336
Taxes3 0723 072
Total12 71611 859
Parent Company20232022
Accrued personnel costs3 0162 432
Other accruals2 0481 793
Interests3336
Taxes1 2431 747
Total6 3396 008
3.10. CONTINGENCIES AND COMMITMENTS
3.10.1. Leasing liabilities
Consolidated20232022
Due during the next reporting period3 6053 781
Due later6 7177 234
Parent Company20232022
Due during the next reporting period1 7131 761
Due later2 6913 281
3.10.2. Rental responsibility (for business premises)
Consolidated
Parent Company
Due for payment during the following accounting period1 171234
Due for payment later1 850352
Total3 021586
3.10.3 Contingent liability on behalf of group companies
20232022
Consolidated267298
Parent Company267298
3.10.4. Other contingent liabilities
Consolidated20232022
Contingencies on own behalf3 7363 460
Parent Company20212022
Contingencies on own behalf3 5843 327