Schneider Electric Danmark A/S

Transcription

1 Schneider Electric Danmark A/S Lautrupvang 1, 2750 Ballerup CVR No Annual report for the year ended 31 December 2014 Approved at the annual general meeting of shareholders on 19 May 2015 Chairman:... Rune Flengsrud

2 Contents Management's review 1 Financial highlights 1 Operating review 2 Statement by the Board of Directors and the Executive Board 4 Independent auditors' report 5 Financial statements Income statement 6 Balance sheet 7 Statement of changes in equity 9 Notes Accounting policies 10 Revenue 15 Staff costs 15 Financial income 15 Financial expenses 16 Tax for the year 16 Intangible assets 16 Property, plant and equipment 17 Investments and other securities 17 Work in progress for third parties 18 Share capital 18 Deferred tax 19 Provisions 19 Deferred income 19 Other payables 19 Security for loans 19 Contingent liabilities and other financial obligations 20 Related parties 20 Fee to the auditors appointed by the company in general meeting /

3 Management's review Financial highlights 5-year summary (in DKK thousands, except per share data): Key figures (in DKK thousands) Revenue 1,717,382 1,735,292 1,725,723 1,216,350 1,098,471 Operating profit 149, , , , ,338 Net financials , Profit/loss for the year 112, , , , ,567 Balance sheet total 662, , , , ,118 Investments in property, plant and equipment -27,715-18,437-15,103-9,911-22,171 Equity 224, , , , ,054 Average number of employees Financial ratios in % EBIT margin Return on assets Return on equity *The comparative financial ratios for are not restated regarding merger of Schneider Electric Building A/S and Schneider Electric Danmark A/S, with Schneider Electric Danmark A/S as the continuing company. 1

4 continued - Management's review Operating review The Company's business review Schneider Electric is the global specialist in energy management and is focusing on helping people and organisations to make the most of their energy. We develop, produce and market products, services and integrated solutions, which makes energy safe, reliable, efficient, productive and green. Our competitive, innovative product portfolio, recognized expertise, and solid relationships with our customers and partners have brought us market leadership. We want to expand it by continuing to provide the best-in-class offer on all our markets and channels. Our customer base is companies within energy and infrastructure, industry, datacentres, networks, buildings and residential. Schneider Electric Danmark A/S is located in Ballerup in the GreenHouse, our new headquarter, where we have merged all our previous locations of the Copenhagen area into one site to foster collaboration between our sales teams from different businesses and with our development department. The Green House is also a showcase for our latest technologies and solutions notably in terms of Energy efficiency and cost reduction. The company has approximately 800 employees and is among others responsible for the Lauritz Knudsen brand, which is the oldest supplier of electrical materials to the Danish market. The manufacturing of the Lauritz Knudsen products is primarily taking place in Schneider Electric s highly automated and energy efficient factory in Ringsted, which also manufactures products to the European and Asian markets. Schneider Electric Danmark A/S is owned by Schneider Electric Industries S.A. (France), which is the ultimate parent company in the Group. Financial review A commercial focus and dedicated investments in our targeted end-user markets, Energy, Industry and Datacenters has brought a significant growth on these businesses. Yet, this growth has been offset by our performance in the building business in a context of continued weak market in The Company s gross margin decreased by MDKK 14 due lower revenue and mix impact. The Company's operating profit decreased by MDKK 65, due to reorganisation cost and an increase of our sale and administration cost. The profit for the year fell by 30% compared to last year, which is below the level that was expected in the 2013 Annual Report. Non-financial matters Schneider Electric s ambition is to be the global specialist in energy management. In Denmark this implies that we continue to play a central role in the Danish electrical industry and that we are contributing to the development of the industry and the market in general. We are focusing on a high degree of delivery reliability, high quality products and product functionality and a high degree of customer satisfaction. The Company also strives to be an attractive workplace for skilled and committed employees. To achieve these objectives the Company highly emphasises building the right competences within the selected business areas, partly through own staff and partly through a comprehensive educational programme with business partners in the industry. Statutory CSR report According to the Danish Financial Statements Act section 99(a), a description of the company s environmental responsibility in relation to environmental consideration has been prepared. For a further description of environmental responsibility please see the company s international website which refer to the company s international accountability policy. Schneider Electric Danmark A/S is environmentally certified according to ISO standard no The Company continues to prevent environmental impact by for example developing environmental friendly products and processes. Also the Company continues to work on minimising the consumption of raw materials and energy and reducing its industrial waste. 2

5 continued - Management's review All employees of Schneider Electric Denmark have committed with signatures to abide by the group s global framework for responsible behaviour: Principles of Responsibility. Those rules affect the legal and ethical principles to guide staff in their behaviour across the firm, with business partners and customers, shareholders and society in general. The same framework commits Schneider Electric to act in accordance with the principles of sustainable development and to show respect for community development, taking into account environmental protection and global climate challenges and participate in local community activities. Schneider Electric undertakes simultaneously to market safe products that improve the environment and optimize energy and natural resources. Account of the gender composition of management According to the Danish Financial Statements Act section 99(b) section 3, the company is not underrepresented by one gender of the gender in the board of directors. The company has adopted a policy with the aim to increase the share of the underrepresented gender on the company s other management levels. We hire the best candidates, but at the same time we try to attract qualified women to management position. We offer female employees with manager potential to participate in relevant networks just as we internally offer coaching arrangements. Finally we aim to have at least one of each gender amongst the last three candidates for a management position. The ongoing activities have not yet implied major changes on the management levels. Thomas Traeger, Management director for Schneider Electric Denmark, has signed the WEP (Woman Empowerment Principles) while the United Nations Women and Global Compact has conferred Jean Pascal Tricoire, the Group CEO, the 2015 CEO Leadership Award in recognition of his demonstrated commitment to and implementation of policies that advance and empower women in the workplace, marketplace and community Post balance sheet events No events have occurred after the financial year-end, which could significantly affect the Company's financial position. Outlook We have had a good start to the year and expect an above GDP increase in business volumes for the year. Additional lines of products have been transferred to the Ringsted plant as part of the strategy of our Global supply chain. This should improve the profitability in

6 Statement by the Board of Directors and the Executive Board The Board of Directors and the Executive Board have today discussed and approved the annual report of Schneider Electric Danmark A/S for the financial year 1 January - 31 December The annual report is prepared in accordance with the Danish Financial Statements Act. In our opinion, the financial statements give a true and fair view of the Company's financial position at 31 December 2014 and of the results of the Company's operations for the financial year 1 January - 31 December Further, in our opinion, the Management's review gives a fair review of the matters discussed in the Management's review. We recommend the adoption of the annual report at the annual general meeting. Ballerup, 19 May 2015 Executive Board: Thomas Träger Board of Directors: Rune Flengsrud Chairman Omar Akrout Hanne Taarup Jensen Anita Jensen Otzen Uffe Egelund Jensen 4

7 Independent auditors' report To the shareholders of Schneider Electric Danmark A/S Independent auditors' report on the financial statements We have audited the financial statements of Schneider Electric Danmark A/S for the financial year 1 January - 31 December 2014, which comprise an income statement, balance sheet, statement of changes in equity and notes, including accounting policies. The financial statements are prepared in accordance with the Danish Financial Statements Act. Management's responsibility 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. Further, Management is responsible for such internal control as it determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors' responsibility Our responsibility is to express an opinion on the financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing and additional requirements according to Danish audit regulations. This requires that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' judgement, including an assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation of financial statements that give a true and fair view. The purpose is to design audit procedures that are appropriate in the circumstances, but not to express an opinion on the effectiveness of the Company's internal control. An audit also includes evaluating the appropriateness of accounting policies used, the reasonableness of accounting estimates made by Management as well as the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Our audit has not resulted in any qualification. Opinion In our opinion, the financial statements give a true and fair view of the Company's financial position at 31 December 2014 and of the results of its operations for the financial year 1 January - 31 December 2014 in accordance with the Danish Financial Statements Act. Statement on the Management's review Pursuant to the Danish Financial Statements Act, we have read the Management's review. We have not performed any other procedures in addition to the audit of the financial statements. On this basis, it is our opinion that the information provided in the Management's review is consistent with the financial statements. Copenhagen, 19 May 2015 ERNST & YOUNG Godkendt Revisionspartnerselskab Jan C. Olsen state authorised public accountant Bo Leinum state authorised public accountant 5

8 Income statement for the year ended 31 December Notes Revenue 1,717,382 1,735,292 3 Production costs -1,140,238-1,144,851 Other operating income Gross profit 577, ,241 3 Distribution costs -215, ,135 3 Administrative expenses -204, ,129 Development costs -7,302-9,555 Other operating expenses Operating profit 149, ,519 4 Financial income 1,646 1,450 5 Financial expenses -2,046-2,166 Profit before tax 148, ,803 6 Tax for the year -35,986-52,737 Profit/loss for the year 112, ,066 Recommended appropriation of the profit/loss for the year Proposed dividend recognised under equity 112, ,362 Retained earnings 0-43, , ,066 6

9 Balance sheet at 31 December Notes Assets Fixed assets Completed development projects Acquired intangible assets 753 1,530 7 Intangible assets 853 1,632 Land and buildings 43,977 46,271 Plant and machinery 46,738 57,936 Other fixtures and fittings, tools and equipment 4,511 5,339 Property, plant and equipment in progress 35,886 14,075 8 Property, plant and equipment 131, ,621 9 Investments in group entities at cost Other securities and investments 3,383 3,383 Investments 3,383 3,383 Total fixed assets 135, ,636 Current assets Raw materials and consumables 13,550 24,254 Work in progress 7,005 11,618 Manufactured goods and goods for resale 49,840 57,875 Inventories 70,395 93,747 Trade receivables 260, , Work in progress for third parties 17,016 24,502 Receivables from group entities 117, ,438 Income taxes receivable 128 2,711 Other receivables 46,328 23,945 Prepayments 246 1,288 Receivables 441, ,859 Cash 15,519 33,722 Total current assets 527, ,328 Total assets 662, ,964 7

10 Balance sheet at 31 December Notes Equity and liabilities Equity 11 Share capital 112, ,000 Retained earnings/accumulated loss 0 0 Dividend proposed for the year 112, ,362 Total equity 224, ,362 Provisions 12 Provisions for deferred tax 11,282 26,502 Other provisions 17,234 14, Total provisions 28,516 40,829 Liabilities Trade payables 66,075 72,663 Payables to group entities 83, , Work in progress for third parties 35,540 53, Deferred income 30,536 24, Other payables 193, ,719 Short-term liabilities 409, ,773 Total liabilities 409, ,773 Total equity and liabilities 662, ,964 8

11 Statement of changes in equity () Share capital Retained earnings Dividend proposed for the year Total Balance at 1/ ,000 43, , ,449 Dividend distributed -202, ,153 Profit/loss for the year, cf. appropriation of profit/loss -43, , ,066 Equity at 1/ , , ,362 Dividend distributed -204, ,362 Profit/loss for the year, cf. appropriation of profit/loss 0 112, ,899 Equity at 31/ , , ,899 9

12 Notes 1. Accounting policies The annual report of Schneider Electric Danmark A/S has been presented in accordance with the provisions of the Danish Financial Statements Act as regards large reporting class C enterprises. The accounting policies applied by the company are consistent with those of last year. Omission to present a cash flow statement With reference to section 86(4) of the Danish Financial Statements Act, no cash flow statement has been prepared. The entity's cash flows are part of the consolidated cash flow statement for the parent company, Schneider Electric Industries S.A. Reporting currency The financial statements are presented in Danish kroner. Currency translation Transactions denominated in foreign currencies are translated into Danish kroner at the exchange rate at the date of the transaction. Receivables, payables and other monetary items denominated in foreign currencies are translated into Danish kroner at the exchange rate at the balance sheet date. Realised and unrealised exchange gains and losses are recognised in the income statement as financial income/expenses. Income statement Revenue Income from the sale of goods and finished goods is recognised in revenue at the time of delivery and when the risk passes to the buyer, provided that the income can be made up reliably and is expected to be received. Income from the rendering of services, is recognised as revenue as the services are rendered, implying that revenue corresponds to the market value of the services rendered in the year (production method). Income from construction contracts where the purchaser has significantly influenced the construction of the asset is recognised as revenue as the production activities are carried on, implying that revenue corresponds to the market value of the contract work performed (production method). This method is used where the total income and expenses and the degree of completion of the contract can be made up reliably. Where the income from a construction contract cannot be estimated reliably, contract revenue corresponding to the expenses incurred is recognised only in so far as it is probable that such expenses will be recoverable from the counterparty. Revenue is measured net of all types of discounts/rebates granted. Also, revenue is measured net of VAT and other indirect taxes charged on behalf of third parties. Other operating income and operating expenses Other operating income and operating expenses comprise items of a secondary nature relative to the entity's core activities, including gains or losses on the sale of fixed assets and sales/write down of shares in group enterprises. Production costs Production costs include expenses incurred to generate the year's revenue. The item includes direct and indirect expenses relating to raw materials, consumables, labour, rent and leasing as well as depreciation of productive equipment. Research costs, development costs not satisfying the criteria for capitalisaion and amortisation/depreciation of capitalised development costs are also recognised under production costs. Furthermore, provisions for losses on construction contracts are recognised. 10

13 Notes 1. Accounting policies - continued Distribution expenses Distribution expenses include expenses relating to sale and distribution in the year, including expenses relating to sales staff, advertising, exhibitions and amortisation/depreciation of assets that are related to sale and distribution of the company's products. Administrative expenses Administrative expenses include expenses incurred in the year for purposes of managing and administering the company, including expenses relating to administrative staff, management, office premises/expenses as well as amortisation/depreciation of assets used for administrative purposes. Financial income and expenses Financial income and expenses are recognised in the income statements at the amounts that concern the financial year. Net financials include interest income and expenses as well as allowances and surcharges under the advancepayment-of-tax scheme, etc. Dividends for investments in group enterprises are recognised as income in the financial year when the dividend is declared. Tax Tax for the year includes current tax on the year's expected taxable income and the year's deferred tax adjustments. The portion of the tax for the year that relates to the profit/loss for the year is recognised in the income statement, whereas the portion that relates to transactions taken to equity is recognised in equity. The parent and all Danish group entities are jointly taxed. The Danish income tax charge is allocated between profitmaking and loss-making Danish entities in proportion to their taxable income (full allocation method). The parent acts as a management company for all the entities encompassed by the joint taxation arrangement and is thus responsible for ensuring that tax charges, etc. are paid to the Danish tax authorities. Jointly taxed companies entitled to a tax refund are, as a minimum, reimbursed by the management company according to the current rates applicable to interest allowances, and jointly taxed companies having paid too little tax pay, as a maximum, a surcharge according to the current rates applicable to interest surcharges to the management company. 11

14 Notes 1. Accounting policies - continued Balance sheet Intangible assets Other intangible assets include development projects and other acquired intangible rights, including software licences, distribution rights and development projects. Other intangible assets are measured at cost less accumulated amortisation and impairment losses. An initial recognition, intangible assets are measured at cost. Development projects are capitalised if they are clearly defined and identifiable and the following recognition criteria can be satisfied: the technical feasibility of completing the project can be demonstrated, plans are to produce and market the product or to use the product or the process, sufficient technical and financial resources to complete and use or sell the project are available, it is probable that the project will generate future economic benefits and that a potential, future market or possibility of internal use in the entity exists, the cost can be made up reliably. Development costs not satisfying the above criteria are expensed in the income statement as incurred. The cost of development projects is measured at direct costs incurred as well as a portion of costs indirectly attributable to the individual development projects. Software are measured at cost less accumulated amortization and impairment losses. Software are amortized over 5 years. Gains or losses on the sale of intangible assets are recognised in the income statement under 'Other operating income' or Other operating expenses', respectively. Gains and losses are calculated by reference to the difference between the selling price less selling expenses and the carrying amount at the time of sale. Property, plant and equipment Items of property, plant and equipment are measured at cost less accumulated depreciation and impairment losses. Land is not depreciated. Cost includes the acquisition price and costs directly related to the acquisition until the time at which the asset is ready for use. Buildings - 25 years Buildings installations - 10 years Plant and machinery - 8 years Tools - 4 years Fixtures and fittings, tools and equipment years Gains or losses arising from the sale of items of property, plant and equipment are recognised in the income statement under 'Other operating income' or 'Other operating expenses', respectively. Gains and losses are calculated by reference to the difference between the selling price less selling expenses and the carrying amount at the time of sale. Investments in group entities Investments in subsidiaries are measured at cost. Dividends received which exceed the accumulated earnings in the subsidiary in the period of ownership are treated as a cost reduction. 12

15 Notes 1. Accounting policies - continued Other securities and investments Other securities and investments are measured at cost. Impairment of fixed assets Every year, intangible assets and property, plant and equipment as well as investments in subsidiaries are reviewed for impairment. Where there is indication of impairment, an impairment test is made for each individual asset or group of assets, respectively, generating independent cash flows. The assets are written down to the higher of the value in use and the net selling price of the asset or group of assets (recoverable amount) if it is lower than the carrying amount. Inventories Inventories are measured at the lower of cost, measured by reference to the FIFO method, and net realisable value. The cost of raw materials and consumables comprises the cost of acquisition plus delivery costs as well as other costs directly attributable to the acquisition. Work in progress and finished goods are measured at manufacturing cost, which includes the cost of raw materials, consumables and direct payroll costs plus production overheads. Production overheads comprise the indirect cost of material and labour as well as maintenance and amortisation/depreciation of intangible assets and property, plant and equipment used in the production process. Goods for resale are measured at cost, which comprises the cost of acquisition plus delivery costs as well as other costs directly attributable to the acquisition. Receivables Receivables are measured at amortised cost, which usually corresponds to the nominal value. Provisions are made for bad debts on the basis of objective evidence that a receivable or a group of receivables are impaired. Provisions are made to the lower of the net realisable value and the carrying amount. Work in progress for third parties Ongoing service supplies and work in progress for third parties are measured at the market value of the work performed less advances received. The market value is calculated on the basis of the percentage of completion at the balance sheet date and the total expected income from the relevant contract. The percentage of completion is made up based on costs incurred relative to the expected, total expenses on each individual work in progress. Where the outcome of contract work in progress cannot be made up reliably, the market value is measured at the costs incurred in so far as they are expected to be paid by the purchaser. Where the total expenses relating to the work in progress are expected to exceed the total market value, the expected loss is recognised as a loss-making agreement under 'Provisions' and is expensed in the income statement. The value of each contract in progress less prepayments is classified as assets when the market value exceeds prepayments and as liabilities when prepayments exceeds the market value. Prepayments Prepayments recognised under Assets' comprise prepaid expenses regarding subsequent financial reporting years. Cash and cash equivalents Cash comprises cash balances and bank balances. Equity Proposed dividends Dividends proposed for the financial year are presented as a separate item under Equity'. 13

16 Notes 1. Accounting policies - continued Provisions Provisions comprise expected expenses relating to guarantee commitments, losses on work in progress, restructurings, etc. Provisions are recognised when the company has a legal or constructive obligation as a result of a past event at the balance sheet date and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation. Guarantee commitments comprise expected cost of repairs within the guarantee period and are recognised based on previous experience with work performed under guarantees. Provisions are measured at net realisable value. Corporation tax Current tax payable and receivable is recognised in the balance sheet as the estimated tax charge in respect of the taxable income for the year, adjusted for tax on prior years' taxable income and tax paid on account. Provisions for deferred tax are calculated, based on the liability method, of all temporary differences between carrying amounts and tax values, with the exception of temporary differences occurring at the time of acquisition of assets and liabilities neither affecting the results of operations nor the taxable income. Deferred tax is measured according to the taxation rules and taxation rate applicable at the balance sheet date when the deferred tax is expected to crystallise as current tax. Deferred tax assets are recognised at the value at which they are expected to be utilised, either through elimination against tax on future earnings or through a set-off against deferred tax liabilities within the same jurisdiction. Other payables Other payables are measured at net realisable value. Deferred income Deferred income recognised as a liability comprises payments received concerning income in subsequent financial reporting years. Segment information As the company only has operations within a single segment, segment information is not disclosed in the annual report. Financial ratios Financial ratios are calculated in accordance with the Danish Society of Financial Analysts' guidelines on the calculation of financial ratios 'Recommendations and Financial Ratios 2010', cf. below: Definition of financial ratios: EBIT margin: Profit/loss from ordinary operating activites / Revenue * 100 Return on assets: Profit/loss from ordinary operating activites / Average assets * 100 Return on equity: Profit/loss for the year / Average equity *

17 Notes Revenue Business segmentation of revenue: Sale of goods 1,322,242 1,280,553 Sale of projects 395, ,739 1,717,382 1,735,292 Geographical segmentation of revenue: Denmark 1,545,216 1,570,265 International markets 172, ,027 1,717,382 1,735, Staff costs Analysis of staff costs: Wages/salaries 456, ,628 Pensions 18,501 17,676 Other social security costs 4,723 3, , ,423 Number Number Average number of employees By reference to section 98b(3), (ii), of the Danish Financial Statements Act, remuneration to management is not disclosed Financial income Interest receivable, group entities 0 23 Exchange gain 1,542 1,234 Other financial income ,646 1,450 15

18 Notes Financial expenses Interest expenses, group entities Exchange losses 1,942 1,769 Other financial expenses ,046 2, Tax for the year Estimated tax charge for the year 53,737 42,579 Deferred tax adjustments in the year -15,220 12,021 Tax adjustments, prior years -2,531-1,863 35,986 52, Intangible assets () Completed development projects Software Total Cost Balance at 1/ ,805 17,308 25,113 Cost at 31/ ,805 17,308 25,113 Amortisation and impairment losses Balance at 1/ ,705 15,777 23,482 Amortisation in the year Amortisation and impairment losses at 31/ ,705 16,555 24,260 Carrying amount at 31/

19 Notes 8. Property, plant and equipment () Cost Land and buildings Plant and machinery Other fixtures and fittings, tools and equipment Property, plant and equipment in progress Balance at 1/ , ,835 61,084 14, ,707 Additions in the year ,586 27,715 Disposals in the year -2,356-7,217-9, ,297 Transfer from other accounts 1,992 2,175 1,608-5,775 0 Cost at 31/ , ,793 53,041 35, ,125 Depreciation and impairment losses Balance at 1/ , ,899 55, ,087 Depreciation in the year 4,343 13,373 2,431 20,147 Reversal of depreciation and impairment losses, disposals -2,356-7,217-9,648-19,221 Depreciation and impairment losses at 31/ , ,055 48, ,013 Carrying amount at 31/ ,977 46,738 4,511 35, ,112 Total 9. Investments and other securities () Cost Group entities in total Other securities and investments Balance at 1/ ,165 8,796 Disposals in the year -7,165 0 Cost at 31/ ,796 Impairment losses Balance at 1/ ,165 5,413 Reversal of impairment losses, sold investments -7,165 0 Impairment losses at 31/ ,413 Carrying amount at 31/ ,383 17

20 Notes 9. Investments and other securities - continued Other investments Legal form Domicile Schneider India Limited India Nordfyns Erhvervsselskab A/S Denmark 31/ / Work in progress for third parties On-account invoicing, work in progress -18,524-28,608-18,524-28,608 Work in progress is classified in the balance sheet at DKK 17,016 thousand as net receivables and DKK 35,540 thousand as net liabilities. Selling price of contract work in progress totals DKK thousand (2013 DKK ) and invoicing on account totals DKK (2013 DKK thousand). 31/ / Share capital Analysis of the company's share capital, DKK 112,000 thousand: 5 share(s) of DKK 22,400, each 112, , , , Analysis of changes in the share capital over the past 5 years: Opening balance 112, , , , ,230 Capital increase 0 2,000 1, Closing balance 112, , , , ,230 18

21 Notes 12. Deferred tax 31/ / Analyses of the deferred tax Deferred tax asset [+] 0 0 Deferred tax liabililty [-] -11,282-26,502-11,282-26, Provisions The provision for deferred tax primarily relates to timing differences in respect of intangible assets, liabilities and property, plant and equipment. Other provisions comprise provisions for warranty commitments, totalling DKK thousand and restructuring provisions of DKK thousand. Warranty provisions relate to expected warranty expenses in accordance with usual guarantee commitments applicable to the sale of goods. The obligation is expected to be settled over the warranty period, which is seven years. The restructuring provision will be paid out in the coming financial year. 14. Deferred income Deferred income comprises payments relating to the sale of services, which will not be recognised as income until in the subsequent financial year once the recognition criteria are satisfied. 31/ / Other payables VAT and other indirect taxes 24,409 23,142 Wages/salaries, salary taxes, social security contributions, etc. 85,628 75,920 Other accrued expenses 83,408 44, , , Security for loans The Company has not placed any assets or other as security for loans at 31/

22 Notes 17. Contingent liabilities and other financial obligations The Company is jointly taxed with its parent, Schneider Nordic Baltic A/S, which acts as management company, and is jointly and severally with other jointly taxed group entities for payment of income taxes for the income year 2013 onwards as well as withholding taxes on interest, royalties and dividends falling due for payment on or after 1 July Other financial obligations 31/ / Other rent and lease liabilities: Rent and lease liabilities 180, ,600 The Company have issued performance bonds for DKK 73 million (2013 DKK 78 million). 18. Related parties Information about related parties with a controlling interest: Related party Domicile Basis for control Schneider Nordic Baltic A/S Sundkrogsgade 5, Copenhagen E Share capital Information about consolidated financial statements: Parent Domicile Requisitioning of the parent's consolidated financial statements Schneider Electric Industries S.A. France inance/presentations/annual-rep orts.page The following shareholders are registered in the Company's register of shareholders as holding minimum 5% of the votes or minimum 5% of the share capital: Name Schneider Nordic Baltic A/S Domicile Sundkrogsgade 5, 2100 Copenhagen E 19. Fee to the auditors appointed by the company in general meeting Audit fees are not disclosed with reference to section 96(3) of the Danish Financial Statements Act. The fee is specified in the consolidated financial statements for Schneider Electric Industries S.A. 20