Scandlines Gedser-Rostock ApS

Development in activities and finances The financial year 2018 shows a profit for the year of DKK 129.580 thousands, which is an increase of DKK 73.21...

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Scandlines Gedser-Rostock ApS Havneholmen 25, 8. 1561 Copenhagen Business Registration No 33260024

Annual report 2018

The Annual General Meeting adopted the annual report on 29.04 2019

Chairman of the General Meeting

______________________________________________ Name: Søren Poulsgaard Jensen

 

^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^ 

Contents

Entity detail͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘ϯ Statement by Management on the annual report͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘ϰ Independent auditor's report͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘ϱ Management Commentary͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘ϴ Income statement for 2018͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘ϭϭ Balance sheet at 31.12.2018͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘ϭϮ Statement of changes in equity for 2018͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘ϭϰ Notes͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘ϭϱ Accounting policies͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘͘ϮϬ

 

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Entity detail Entity Scandlines Gedser-Rostock ApS Havneholmen 25, 8. 1561 Copenhagen

Central Business Registration No (CVR): 33260024 Registered in: Copenhagen Financial year: 01.01.2018 - 31.12.2018

Phone: +4533151515 Fax: +4535290201 Website: www.scandlines.dk E-mail: [email protected] Supervisory Board Frans Blach Rossen, Chairman of the Board Stig Dambmann Claus Peter Vitting Nikolajsen Henrik Birk Larsen Jan Raymond Saksaa

Executive Board Søren Poulsgaard Jensen, CEO Per Johannesen Madsen, CFO

Auditors Deloitte Statsautoriseret Revisionspartnerselskab Weidekampsgade 6 P.O. Box 1600 0900 Copenhagen C

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Statement by Management on the annual report The Supervisory Board and the Executive Board have today considered and approved the annual report of Scandlines Gedser-Rostock ApS for the financial year 01.01.2018 - 31.12.2018 The annual report is presented in accordance with the Danish Financial Statements Act. In our opinion, the financial statements give a true and fair view of the Entity's financial position at 31.12.2018 and of the results of its operations for the financial year 01.01.2018 31.12.2018. We believe that the management commentary contains a fair review of the affairs and conditions referred to therein. We recommend the annual report for adoption at the Annual General Meeting. Copenhagen, 29.04 2019

Executive Board

Søren Poulsgaard Jensen CEO

Per Johannesen Madsen CFO

Supervisory Board



Frans Blanch Rossen Chariman of the Board

Stig Dambmann

Henrik Birk Larsen

Jan Raymond Saksaa

Claus Peter Vitting Nikolajsen



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Independent auditor's report To the shareholder of Scandlines Gedser-Rostock ApS Opinion We have audited the financial statements of Scandlines Gedser-Rostock ApS for the financial year 01.01.2018 - 31.12.2018, which comprise the income statement, balance sheet, statement of changes in equity and notes, including a summary of significant accounting policies. The financial statements are prepared in accordance with the Danish Financial Statements Act. In our opinion, the financial statements give a true and fair view of the Entity's financial position at 31.12.2018 and of the results of its operations for the financial year 01.01.2018 31.12.2018 in accordance with the Danish Financial Statements Act. Basis for opinion We conducted our audit in accordance with International Standards on Auditing (ISAs) and additional requirements applicable in Denmark. Our responsibilities under those standards and requirements are further described in the Auditor's responsibilities for the audit of the financial statements section of this auditor's report. We are independent of the Entity in accordance with the International Ethics Standards Board of Accountants' Code of Ethics for Professional Accountants (IESBA Code) and the additional requirements applicable in Denmark, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Management's responsibilities for the financial statements Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the Danish Financial Statements Act, and for such internal control as Management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, Management is responsible for assessing the Entity's ability to continue as a going concern, for disclosing, as applicable, matters related to going concern, and for using the going concern basis of accounting in preparing the financial statements unless Management either intends to liquidate the Entity or to cease operations, or has no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they ϱ 

^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^  could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. As part of an audit conducted in accordance with ISAs and the additional requirements applicable in Denmark, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: Ͳ

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

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Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Entity's internal control.

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Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management.

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Conclude on the appropriateness of Management's use of the going concern basis of accounting in preparing the financial statements, and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Entity's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Entity to cease to continue as a going concern.

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Evaluate the overall presentation, structure and content of the financial statements, including the dis- closures in the notes, and whether the financial statements represent the underlying transactions and events in a manner that gives a true and fair view.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

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^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^  Statement on the management commentary Management is responsible for the management commentary. Our opinion on the financial statements does not cover the management commentary, and we do not express any form of assurance conclusion thereon. In connection with our audit of the financial statements, our responsibility is to read the management commentary and, in doing so, consider whether the management commentary is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. Moreover, it is our responsibility to consider whether the management commentary provides the information required under the Danish Financial Statements Act. Based on the work we have performed, we conclude that the management commentary is in accordance with the financial statements and has been prepared in accordance with the requirements of the Danish Financial Statements Act. We did not identify any material misstatement of the management commentary. Copenhagen, 29.04 2019

Deloitte Statsautoriseret Revisionspartnerselskab Central Business Registration No (CVR) 33963556

Kirsten Aaskov Mikkelsen State Authorised Public Accountant Identification No (MNE) mne21358

Bjarne Iver Jørgensen State Authorised Public Accountant Identification No (MNE) mne35659

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Management Commentary 

Financial highlights Key figures Revenue Gross profit/loss Operating profit/loss Net financials Profit/loss for the year Total assets Investements in property, plant and equipment Equity Average numbers of employees

Ratios Gross margin (%) Net margin (%) Return on equity (%) Equity ratio (%) Revenue per employee

2018 DKK'000

2017 DKK'000

2016 DKK'000

2015 DKK'000

2014 DKK'000

560.173 258.366

521.156 119.728

451.585 101.685

407.014 74.294

383.470 108.377

174.899 -44.962 129.580 1.518.697

54.193 -4.930 56.370 1.340.311

48.397 13.871 58.722 325.644

18.152 25.152 41.551 400.438

42.607 23.778 64.843 331.702

4.109

1.487.307

0

6.172

0

219.352

347.597

285.623

267.950

271.001

87

87

98

103

104

46,1 23,1 45,7 14,4 6.439

23,0 10,8 17,8 25,9 5.990

22,5 13,0 21,2 87,7 4.608

18,3 10,2 15,4 66,9 3.952

28,3 16,9 23,3 81,7 3.687

  

Financial highlights are defined and calculated in accordance with "Recommendations & Ratios" issued by the Danish Society of Financial Analysts.   

Ratios

Calculation formula

Calculation formula reflects

Gross margin (%)

Gross profit/loss x 100 Revenue

The entity’s operating gearing.

Net margin (%)

Profit/loss for the year x 100 Revenue

The entity’s operating profitability

Return on equity (%)

Profit/loss for the year x 100 Average equity

The entity's return on capital invested in the entity by the owners.

Equity ratio (%)

Revenue per employee

Equity x 100 Total assets Revenue Average number of employees

The financial strength of the entity.

The entity's productivity

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Management Commentary Primary activities The Company's primary activities are to operate ferries in the route Gedser-Rostock. Development in activities and finances The financial year 2018 shows a profit for the year of DKK 129.580 thousands, which is an increase of DKK 73.210 thousands compared to 2017. In 2017 Scandlines Gedser Havn ApS has been merged into Scandlines Gedser-Rostock ApS. The merger has been accounted for by the book-value-method, hence the comparative figures in the financial statement for Scandlines Gedser-Rostock ApS has not been changed. For a more detailed description, we refer to the Group financial statements of Scandferries ApS. Outlook We expect the result for 2019 to be at the same level as 2018.

Particular risks The most material financial risks are currency, oil, interest and credit risks, which only occur in relation to the operating activities. The risk factors are hedged at Group level and we refer to the "Management commentary" in the Group financial statements of Scandferries ApS for a detailed description.

Intellectual capital resources For a detailed description of intellectual capital resources, we refer to the Group Financial statements of Scandferries ApS.

Staff The company employed an average of 87 people in the financial year 2018, which is the same as 2017. We continuously work to optimize the psychical and mental work environment. All work related to security is coordinated by the security group. Additionally, we have a constructive dialogue on the development

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^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^  Environmental performance Safety for our passengers, crew and vessels is paramount to any other parameter in our business. Weekly and monthly exercises for our crewmembers and testing of our equipment follow mandatory education. All the vessels are inspected several times during a year, and we are satisfied to hold a high quality in 2018. For more detailed description, please see the "Management commentary" in the Group financial statements of Scandferries ApS.

Statutory report on corporate social responsibility Scandlines Gedser-Rostock ApS considers such matters as human rights, social aspects, environment and anticorruption as important elements of the Group's business strategy and activities. Corporate Social Responsibility is about living the values and principles that govern out behavior as a responsible business in respect of customers, staff, suppliers and investors. It is our clear policy to comply with the words and spirit of the laws, rules and regulations that apply in the countries within our companies operate.

Statutory report on the underrepresented gender The Supervisory Board of the Scandlines Gedser-Rostock ApS, currently do not have any female members elected by the general assembly. The objective of the Group is within a period of four years to have one female Board member, elected on a general assembly. For further detailed description, please see the "Management commentary" in the Group financial statements of Scandferries ApS.

Events after the balance sheet date No events have occurred after the balance sheet date to this date, which would influence the evaluation of this annual report.

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^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^ _______________________________________________________________________________

Income statement 2018 Note Revenue Other operating income Cost of raw materials and consumables Other external expenses

1 2

Gross profi / loss

Staff costs Depreciation and amortization

3 4

Operating profit / loss Other financial income Other financial expenses

5 6

Profit / loss before tax

2018 DKK'000

2017 DKK'000

560.173 40.041 -146.705 -195.143

521.156 46.136 -243.048 -204.517

258.366

119.727

-37.209 -46.258

-36.262 -29.273

174.899

54.192

17.218 -62.180

17.299 -22.229

129.937

49.262

Tax on profit for the year

7

-357

7.107

Profit / loss for the year

8

129.580

56.370

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^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^ _______________________________________________________________________________

Balance sheet at 31-12-2018 31-12-2018 DKK'000

31-12-2017 DKK'000

46

93

46

93

63.213 224.070 956.419 0 7.536

65.362 233.654 990.421 0 3.903

1.251.238

1.293.340

1.251.284

1.293.433

Manufactured goods and goods for resale

4.778

3.902

Inventories

4.778

3.902

Trade receivables Receivable from affiliated companies Other receivables Prepayments

30.169 231.107 1.135 0

24.453 14.301 3.617 403

Receivables

262.412

42.774

223

202

267.413

46.878

1.518.697

1.340.311

Note Software Intangible assets

9

Land and buildings Plant and machinery Vessels Other fixtures and fittings, tools and equipment Asset under construction Property, plant and equipment

Fixed assets

Cash

Current assets

Assets

10

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^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^ _______________________________________________________________________________

Balance sheet at 31-12-2018 31-12-2018 DKK'000

31-12-2017 DKK'000

Share capital Other reserves Retained earnings Dividend

30.000 -2.922 42.274 150.000

30.000 1.519 316.078 0

Equity

219.351

347.597

16.409 1.270.824 11.880 100 133

24.773 960.167 7.575 66 133

Short term liabilities

1.299.346

992.714

Liabilities

1.299.346

992.714

Equity and liabilities

1.518.697

1.340.311

Note

Trade payable Payable to affiliated companies Other payables Prepayments / deferred income Company Tax

Contingent liabilities Assets charged and collateral Transactions with related parties Group relations

12

13 14 15 16

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^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌZŽƐƚŽĐŬƉ^ _______________________________________________________________________________

Statement of changes in equity for 2018 Share capital

Equity at 1 January 2018

Other Reserve

Proposed dividend

Total

DKK'000

DKK'000

DKK'000

DKK'000

DKK'000

30.000

1.519

316.078

0

347.597

Profit / loss for the year Ordinary dividend Extra ordinary dividend Value adjustment

Equity at 31 December 2018

Retained earnings

129.580 -150.000 -253.385

150.000

42.274

150.000

-4.441 30.000

-2.922

129.580 0 -253.385 -4.441 219.352

The share capital consists of 30.000 share at DKK 1.000 nominal. There have not been any changes in the share capital in the past five years.

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Notes

1

2

3

31-12-2018 DKK'000

31-12-2017 DKK'000

Ferry transport

560.173

521.156

Total

560.173

521.156

Catering and other income Gain/Sale of fixed assets

40.041 0

37.775 8.361

Total other operating income

40.041

46.136

Salaries and wages Pension costs Other social security expenses

-32.063 -4.077 -1.069

-31.081 -4.168 -1.013

Total salary expense

-37.209

-36.262

Average number of employees

87

87

Executive Board / management Supervisory Board

-27.587 -893

-21.605 -120

Total remuneration of management

-28.480

-21.725

Revenue

Other operating income

Salary expense

The Executive Board receives remuneration for handling the whole Scandferries Group. Therefore, only a minor part of the total remuneration is directly related to the work performed in Scandlines Gedser-Rostock ApS.

4 Depreciation and

5

Depreciation of property, plant and equipment Amortisation of intangible assets

-46.211 -47

-29.226 -47

Total depreciation

-46.258

-29.273

Interest from affiliated companies Exchange rate adjustments

14.733 2.485

16.589 710

Total financial income

17.218

17.299

Other financial income

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^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^ _______________________________________________________________________________

6

7

8

31-12-2018 DKK'000

31-12-2017 DKK'000

Interest to affiliated companies Exchange rate adjustments

-57.772 -4.408

-19.697 -2.532

Total financial expenses

-62.180

-22.229

Current tax Current tax previous year

139 -496

183 6.924

Total tax on profit for the year

-357

7.107

150.000 253.385 -273.805

0 0 56.370

129.580

56.370

Other financial expense

Tax on profit for the year

Proposed distribution of profit / loss Ordinary dividend for the financial year Extraordinary dividend for the financial year Retained earnings Total retained earnings

9

Intangible assets Software Cost at 1 January Additions Transfer Disposals Cost at 31 December

220 0 0 0 220

Depreciation and amortization at 1 January Amortization for the year Disposals

-127 -47 0

Depreciation and amortization at 31 December

-174

Carrying amount at 31 December

46

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^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^ _______________________________________________________________________________

Land and buildings

Plant and machinery

Vessels

Cost at 1 January Additions Transfer Disposals

131.500 0 0 0

354.559 0 221 0

1.012.269 255 0 0

Cost at 31 December

131.500

354.780

1.012.523

Depreciation and amortization at 1 January Depreciation for the year Disposals

-66.138 -2.149 0

-120.905 -9.805 0

-21.848 -34.257 0

Depreciation and amortization at 31 December

-68.287

-130.710

-56.105

63.213

224.070

956.419

10 Tangible assets

Carrying amount at 31 December

Other fixtures and fittings, tools and equipment

Asset under construction

Cost at 1 January Additions Transfer Disposals

8.600 0 0 0

3.903 3.854 -221 0

Cost at 31 December

8.600

7.536

Depreciation and amortization at 1 January Depreciation for the year Disposals

-8.600 0 0

0 0 0

Depreciation and amortization at 31 December

-8.600

0

0

7.536

Carrying amount at 31 December

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^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^ _______________________________________________________________________________

11 Prepayments Prepayments consists primarily of prepaid expenses.

12 Deferred income Deferred income consists of received payments for booked crossings.

13 Contingent liabilities Scandlines Gedser-Rostock ApS is jointly taxed with all other Danish Scandlines companies. Under the joint taxation scheme, each company is liable only for its own tax on the taxable income until the tax has been paid to the administration company (Scandlines infrastructure ApS). Scandlines infrastructure ApS, being the administration company, is then solely obliged to pay the tax on the joint taxation income. The company is jointly and severally liable for the subsidiaries intra-group accounts in the Scandlines ApS Group's cash pool arrangement. The Company participates in a Danish joint taxation arrangement in which Scandlines infrastructure ApS serves as the administration company. According to the joint taxation provisions of the Danish Corporation Tax Act, the Company is therefore liable from the financial year 2013 for income taxes etc. for the jointly taxed companies and from 1 July 2012 also for obligations, if any, relating to the withholding of tax on interest, royalties and dividend for the jointly taxed companies.

14 Assets charged and collateral Debt of the ultimate parent company is secured by way of a charge on the ultimate parent Company’s ”trademarks”, such as Scandlines Gedser-Rostock ApS' Vessels, Land and Buildings, Inventories and receivables.

At 31 December, the carrying amounts of assets provided as security are as follows:

Vessels Land and buildings as well as harbor facilities and harbor installations Inventories Receivables

31-12-2018 DKK'000

31-12-2017 DKK'000

956.419 294.819 4.778 262.412

990.421 302.918 3.902 42.774

15 Transactions with related parties There have not been transactions between the company and its related parties which are not carried out under normal market conditions.

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16 Group relations Name and registered office of the Parent preparing consolidated financial statements for the smallest group: Scandferries ApS, Copenhagen Name and registered office of the Parent preparing consolidated financial statements for the largest group: Scandlines Infrastructure ApS, Copenhagen

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Accounting policies Reporting class This annual report has been presented in accordance with the provisions of the Danish Financial Statements Act governing reporting class C enterprises (large). The accounting policies applied for these financial statements are consistent with those applied last year. Recognition and measurement Assets are recognised in the balance sheet when it is probable because of a prior event that future economic benefits will flow to the Entity, and the value of the asset can be measured reliably. Liabilities are recognised in the balance sheet when the Entity has a legal or constructive obligation because of a prior event, and it is probable that future economic benefits will flow out of the Entity, and the value of the liability can be measured reliably. On initial recognition, assets and liabilities are measured at cost. Measurement subsequent to initial recog- nition is effected as described below for each financial statement item. Anticipated risks and losses that arise before the time of presentation of the annual report and that confirm or invalidate affairs and conditions existing at the balance sheet date are considered at recognition and measurement. Income is recognised in the income statement when earned, whereas costs are recognised by the amounts attributable to this financial year. Business combinations Business combinations with companies under control of the parent company of Scandlines Gedser-Rosstock Aps (common control) is completed at the date of the combinations without adjusting comparative figures in accordance with book value method. Foreign currency translation On initial recognition, foreign currency transactions are translated applying the exchange rate at the transaction date. Receivables, payables and other monetary items denominated in foreign currencies that have not been settled at the balance sheet date are translated using the exchange rate at the balance sheet date. Exchange differences that arise between the rate at the transaction date and the one in effect at the payment date, or the rate at the balance sheet date are recognised in the income statement as financial income or financial expenses. Fixed assets purchased in foreign currencies are translated using historical rates. Derivative financial instruments On initial recognition, derivative financial instruments are recognised in the balance sheet at cost and subsequently at fair value. Derivative financial instruments are recognised under other receivables or other payables. Changes in the fair value of derivative financial instruments classified as and complying with the requirements for hedging future transactions are recognised directly in equity. ϮϬ 

^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^  When the hedged transactions are realised, the accumulated changes are recognised as part of cost of the relevant financial statement items. For derivative financial instruments that do not comply with the requirements for being treated as hedging instruments, changes in fair value are recognised currently in the income statement as financial income or financial expenses. Income statement Revenue Revenue relating to passenger and cargo ferrying is recognised in the income statement at the departure time of the vessel. Other operating income Other operating income and other operating expenses comprises income and cost of a secondary nature to the Entity's primary activities. Costs of raw materials and consumables The operating expenses for vessels comprise consumables applied for current operations of vessels, expenses of unplanned shipyard and expenses of current maintenance of safety level on the vessels. Furthermore expenses for changes to the hulls of the vessels or for accommodation construction which did not increase the value in use are included. Other external expenses Other external expenses include expenses relating to the Entity's ordinary activities, including expenses for premises, stationery and office supplies, marketing cost, etc. This item also includes writedowns of receivables recognized in current assets. Staff costs Staff costs comprise salaries and wages as well as social security contributions, pension contributions, etc. for entity staff. Depreciation, amortisation and impairment losses Intangible assets and property, plant and equipment are amortized or depreciated straightline on the basis of the individual estimate of their useful lives. Other financial income Other financial income comprises interest income, realised and unrealised capital gains on securities, liabili-ties other than provisions and foreign currency transactions etc. as well as tax relief under the Danish Tax Prepayment Scheme etc. Other financial expenses Other financial expenses comprise interest expenses, realised and unrealised capital losses on securities, other than provisions and foreign currency transactions etc. as well as tax surcharge under the Danish Tax Prepayment Scheme etc. Tax on profit/loss for the year Tax for the year, which consists of current tax for the year and changes in deferred tax, is recognised in the income statement by the portion attributable to the profit for the year and recognised directly in equity by the portion attributable to entries directly in equity. Ϯϭ 

^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^  The Entity is jointly taxed with all Danish in the Scandlines Group. Current Danish income tax is allocated among the jointly taxed entities proportionally to their taxable income (full allocation with a refund concerning tax losses). The Company jointed the tonnage tax scheme with effect from 1 January 2002. Accordingly, the taxable income related to passenger and cargo ferrying has been calculated based on the tonnage for the year. Income related to other activities is taxed under the ordinary rules of tax law. Balance sheet Intellectual property rights etc Intellectual Assets include software and other intangible assets. The basis of amortization is coast less estimated residual value after the end of useful life. The remaining intangible assets are amortized on a straight-line basis using the estimated useful life of three to five years. Property, plant and equipment Leasehold improvements, vessels, land and buildings, harbour plant and harbour installations as well as other fixtures and fittings, tools and equipment are measured at cost less accumulated depreciation and impair- ment losses. Land is not depreciated. Cost comprises the acquisition price, costs directly attributable to the acquisition and preparation costs of the asset until the time when it is ready to be put into operation. The basis of depreciation is cost less estimated residual value after the end of useful life. Straight-line de- preciation is made on the basis of the following estimated useful lives of the assets:

Vessels

30-40 years

Docking assets

2-5 years

Land and buildings

40 years

Harbor facilities and harbor installations

40 years

Other fixtures and fittings, tools and equipment

3-5 years

Property, plant and equipment are written down to the lower of recoverable amount and carrying amount. Recoverable amount is the higher of value in use (present value of the future net payments) and selling price (broker assessment) less expected selling costs. Value in use is calculated by ferry line. Profits and losses from the sales of property, plants and equipment are calculated as the difference between selling price less selling costs and carrying amount at the time of sale. Profits and losses are recognised in the income statement under other operating income/other operating expenses.

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^ĐĂŶĚůŝŶĞƐ'ĞĚƐĞƌͲZŽƐƚŽĐŬƉ^  Costs related to planned periodical repairs and maintenance work (docking costs) are capitalized and depre- ciated straight-line over the period until the next anticipated docking, typically twofive years. Inventories Inventories are measured at the lower of cost using the FIFO method and net realisable value. Cost of goods for resale, raw materials and consumables consist of acquisition price plus delivery costs. Receivables Receivables are measured at amortised cost, usually equaling nominal value less write-downs for bad debts. Prepayments Prepayments comprise incurred costs relating to subsequent financial years. Prepayments are measured at amortized cost, which usually corresponds to the nominal amount. Cash Cash comprises cash in hand and bank deposits. Operating leases Lease payments on operating leases are recognised on a straight-line basis in the income statement over the term of the lease. Other financial liabilities Other financial liabilities are measured at amortised cost, which usually corresponds to nominal value. Income tax receivable or payable Current tax payable or receivable is recognised in the balance sheet, stated as tax calculated on this year's taxable income, adjusted for prepaid tax. Deferred income Deferred income comprises received income for recognition in subsequent financial years. Deferred income is measured at cost. Cash flow statement The company has according to the Danish Financial Statements Act §86, paragraph 4 omitted to produce a cash flow statement.

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