Annual Report 2022
Trackunit has navigated a stormy
macro-environment in 2022 to set
the platform for significant growth
CVR No 20 75 01 70
The Annual Report was presented
and adopted at the Annual General
Meeting of the Company on:
2 May 2023
Chairman of the AGM
Connecting
Construction.
Building the
Ecosystem.
Together, we
eliminate downtime
to build
the most
useful
industry for
the world
Our approach is human,
collaborative and based on openness
and co-creation. We are driven by
a design thinking approach, being
empathetic, iterative and always
striving for an ecosystem-wide impact.
Downtime is the core of all
problems in the construction industry.
We address it through five key areas,
looking at downtime through the lens
of machines, humans, companies,
our industry as a whole and society
at large. Eliminating Downtime is the
contribution made to create an impact
beyond the industry because it exists
in the world, for the world.
We are builders and doers by
heart and committed to turn every
relevant idea into a catalyst for
change.
Being useful is the core DNA of our
company. We always strive to walk on
two legs, driving a highly commercial
and impact-focused agenda at the
same time.
Construction is a very big player
in the world, and we have at least
the same aspirations so that the
industry can consciously create an
impact for the world. By doing so, we
deliberately balance an inwards focus
with an outwards outlook because
long-term relevance for any ambitious
company will also be measured in the
contribution outside of the industry.
Our Purpose
Management Report
4 The Big Picture
5 Our Story
6 Connecting Construction
7 Building for Scale
8 Five-year Overview
10 Letter from the CEO
11 We are Trackunit
12 What we do
13 It’s the People
14 Eliminate Downtime.
Strengthen Construction.
15 Precise Data.
Actionable Insights.
16 The Strategy
18 Building a Secure Ecosystem
20 Harnessing IoT
22 ESG
23 The Executive Summary
24 Cutting Emissions. Driving Change.
25 Catalyzing the Agenda
26 Finding a Standard Metric
27 Turning the Tide
29 Aligned. Ready. Committed.
30 Serious. Ethical. Secure.
31 Financial Review
Consolidated
Financial Statements
35 Financial Statements
39 Notes
Parent Company
Financial Statements
67 Financial Statements
71 Notes
Statements
84 Management Statement
85 Independent Auditors Report
Contents
Approximately 50% of the
urban environment needed
by 2050 is not yet built.
IoT has the power to
transform the construction
industry as we scale to
meet future demands.
The Big Picture
World Economic Forum.
Our Story
Trackunit is the global leader in brand-agnostic, SaaS-based
IoT solutions connecting o-highway vehicles and equipment
in construction with a data-driven approach predicated on
delivering actionable insights across a connected and secure
ecosystem. Adaptable and scalable, Trackunit is the cornerstone
of a connected industry seeking to eliminate downtime and
propel construction towards a better, more ecient future.
• M-Tec A/S
established
–
• Trackunit subsidiaries established across
Western Europe
• Trackunit acquired
by investment group
of Goldman Sachs
and GRO Capital
• Trackunit
brand
established
• Soeren Brogaard
appointed as CEO
• Trackunit Kin and
Blue-tooth Mesh
Network introduced
to market
• Eliminate Downtime
movement launched
• Trackunit acquires
Satrak
• Introduction of
mobile applications
(Trackunit On &
Trackunit Go)
• Trackunit Iris
platform launched
to market
• Organic entry into
the North American
market
• Trackunit acquires
Dreyer+Timm
• Organic entry into
APJ market
• Trackunit acquired
by Hg Capital
• Trackunit acquires
Industrial IoT division
of ZTR
• Circa 1 billion DKK
net revenue
• Signs deal for
acquisition of
German ConTech
startup Flexcavo
subscriptions
1.25m+
2022
employees
375+
• Launches 5G,
second-generation
Spot connecting
high-value, non-
powered assets
to ecosystem
• Stages first-ever
Trackunit NEXT event
• Trackunit Kin wins
Rental Awards
Editor’s Choice 2022
The Big Picture 5
We Are Trackunit ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
Connecting Construction
We connect our customers. With a presence in more than 100
countries, our customer success teams are there whenever they need
our support in local time. That’s underpinned by our secure global
platform which delivers insights that are actionable around the world
in real-time. It means that, as the home of global connectivity, we
cover all bases in our constant and relentless focus on the industry-
wide battle to eliminate downtime.
19,000
Monthly
active users
120+
Countries in the
global ecosystem
789
OEMs present
in Iris
15
Global
hubs
The Big Picture 6
We Are Trackunit ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
Building for Scale
We’ve built a platform for long-term
growth predicated on profitable
recurring revenue. We are R&D driven
and believe innovation is the key
to unlocking new opportunities to
alleviate long-standing customer pain
points. With net revenue near doubling
in 2022, we’re committed to solving the
problems of today and creating the
solutions for tomorrow.
2022
1.244m
991m
178m
988m
Compound Annual Growth Rate (CAGR) 2018–2022
48%
37%
37%
37%Annual recurring revenue (ARR) in DKK
Number of subscriptions
Net revenue in DKK
EBITDA in DKK
EBITDA as %
of revenue
Share of
recurring revenue
(as % of total revenue)
18%
91%
The Big Picture 7
We Are Trackunit ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
Five-year Overview DKK
Notes
The key figures and financial ratios have been prepared
on a consolidated basis. The financial ratios have been
calculated in accordance with the recommendations of
the Association of Danish Financial Analysts.
• Equity ratio is calculated as the equity divided by total
assets.
• Return on equity is calculated as the profit or loss
for the year before tax divided by the average equity.
The additional key figures (non IFRS measures) have been
prepared on a consolidated basis. The additional key
figures are calculated in accordance with customs within
the industry.
• Recurring revenue % of total revenue is calculated as the
revenue recognized over time in percentage of the total
revenue. Recurring revenue % of total revenue is impacted
by "Other revenue" which comprise of IoT accessories and
installation services which tend to fluctuate between
years. Therefore "Recurring revenue % of total revenue" is
increasing or decreasing slightly year over year."
• Annualized recurring revenue is calculated as the
recurring revenue in the last month of the reporting
period times 12.
Trackunit Telematics Ltd (Satrak UK Ltd) was acquired
4 June 2018 and consolidated from this date.
The acquisition of the Industrial IOT division from within
ZTR Control Systems, LLC, ZTR Holdings LLC and Trac Rail
Inc. (ZTR IIOT) was completed on 18 November 2021 and
consolidated from this date.
Figures for 2018-2019 have not been adjusted to the
IFRS adoption made from 1 January 2020.
' DKK
Recurring revenue % of total revenue (non IFRS measure)
.% .% .% .% .%
Annualized recurring revenue (non IFRS measure)
, , , , ,
No of subscriptions - End of year (non IFRS measure)
,, ,, , , ,
Net revenue , , , , ,
Adjusted Earnings before special items, depreciation,
amortisation and impairment (Adj. EBITDA)
, , , , ,
Earnings before special items, depreciation, amortisation
and impairment (EBITDA) , , , , ,
Earnings from financial items, net (,) (,) (,) (,) (,)
Profit for the period (,) (,) , (,) (,)
Investments in PPE , , , , ,
Total assets ,, ,, , , ,
Equity ,, ,, , , ,
Average number of employees
Ratios
Return on equity (%) (.) (.) . (.) (.)
Equity ratio (%) .% .% .% .% .%
1 Non IFRS measure are unaudited.
2 Adjusted EBITDA = EBITDA before share based payment (note 4) and impact from global
supply shortage of computer chips and other electronic components (note 6) - Unaudited.
In addition to special items excluded from the calculation of adjusted EBITDA further
adjustments exist and should be taken into consideration for calculating a normalized,
forward-looking EBITDA excluding non-recurring items.
The Big Picture 8
We Are Trackunit ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
Subscriptions
2018–2022
~4.8
EBITDA
2018–2022
~3.5
Employee number
2018–2022
~2.7
' USD
Recurring revenue % of total revenue (non IFRS measure)
.% .% .% .% .%
Annualized recurring revenue (non IFRS measure)
, , , , ,
No of subscriptions - End of year (non IFRS measure)
,, ,, , , ,
Net revenue , , , , ,
Adjusted Earnings before special items, depreciation,
amortisation and impairment (Adj. EBITDA)
, , , , ,
Earnings before special items, depreciation, amortisation
and impairment (EBITDA) , , , , ,
Earnings from financial items, net (,) (,) (,) (,) (,)
Profit for the period (,) (,) , (,) (,)
Investments in PPE ,
Total assets , , , , ,
Equity , , , , ,
Average number of employees
Ratios
Return on equity (%) (.) (.) . (.) (.)
Equity ratio (%) .% .% .% .% .%
1 Non IFRS measure are unaudited.
2 Adjusted EBITDA = EBITDA before share based payment (note 4) and impact from global
supply shortage of computer chips and other electronic components (note 6) - Unaudited.
In addition to special items excluded from the calculation of adjusted EBITDA further
adjustments exist and should be taken into consideration for calculating a normalized,
forward-looking EBITDA excluding non-recurring items.
Five-year Overview USD
The key figures are translated from DKK to USD as follows:
• Assets, liabilities, and equity are translated at the
closing rate at the date of the balance sheet.
• Income and expenses are translated at average
exchange rate for the year; except for annualized
recurring revenue which is translated at average
exchange rate for the last month of the year.
The Big Picture 9
We Are Trackunit ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
Despite a tough macro environment,
we not only kept the ship steady through
2022, we nearly doubled revenues and
took significant steps for future growth.
We’ve had quite the year. While at first glance 2022
might not have delivered the drama that marked out
its predecessor, there is every chance that as we look
back on the last 12 months, we will come to see it as
every bit as pivotal as 2021.
Indeed, as we welcome you to the Trackunit Annual
Report 2022, we’ve successfully repositioned the
business for the next stage in the Trackunit story,
signing o the year by almost doubling overall revenue
through a combination of organic and inorganic
growth. That’s put us on the brink of breaking past DKK
1 billion against, let’s not forget, a challenging global
environment backdropped by war, crises in energy and
inflation, and the last dregs of the COVID-19 pandemic.
Despite that weak macro-environment, we signed
on the acquisition of German ConTech startup
Flexcavo just before the year ended successfully
addressing a key strategic area that expands even
further our oering to the contractor and mixed
fleet sector.
It wasn’t our only successful strategic venture. At the
Downtime Festival in Italy in June, we invited the
industry in as we unveiled our product portal in line
with our relentless focus on transparency and
innovation giving our customers instant access to
our portfolio, what’s in the pipeline and where the
roadmap is heading.
And it’s a pipeline that we can be proud of. We
introduced the second-generation Spot to the market at
the end of August propelling the Trackunit name through
the international media in response to an innovation
that has dramatically changed the landscape for the
tracking and usage of non-powered equipment.
It was also a year when we put sustainability firmly
in the spotlight. That included a dedicated event in
Florida in November, and regular content and briefings
highlighting why we believe now is the time to act,
neatly dovetailing with the industry-wide drive to
eliminate downtime and restore construction’s
reputation as a force for good. To that end, we’ve also
made various improvements in our CO
2
emissions
reporting functionality that is tangible and potentially
game-changing.
This excites us because we very much see ourselves
as one of the cogs in construction working towards
big-picture solutions for the big issues facing
construction, society and business. We’re aiming to
eliminate downtime as an industry, and construction is
getting better and better at developing high-quality
infrastructure and doing it in a way that works well
with regulatory demands on emissions and a societal
push for cleaner solutions.
As part of that, Trackunit continues to see data sharing
in a secure environment as an essential part of the
equation and we are thoroughly invested in creating a
connected ecosystem through our extendable platform
as this is fundamental to establishing the mutual data
flows that enable stronger insights and better learnings.
We also joined important organizations like the
Committee for European Construction and Equipment,
developed yet more partnerships with OEMs through our
Works With Trackunit program, with trust firmly at the
center of those relationships, while reinforcing Trackunit’s
presence in our Asia-Pacific-Japan hub where we see
business growing significantly over the coming years.
And we also added well over 100 new team members
to the roster in 2022 ensuring we have the right people
to make things happen at all levels. While words are
great, action speaks louder and nothing gives me
greater pleasure than to see our people drive change
as this will most likely have an impact on the success of
the company as we take on board more rounded,
better perspectives. As just one example, a bottom-up
initiative has helped establish the Trackunit Inclusivity
Diversity Equity (TIDE) program which will help support
our ESG eorts.
It’s why we’re moving forward with confidence. And
that’s why we believe 2022 will go down as one where
we successfully steered the ship and our customers to
calmer waters ready for the next big take o.
Stormy Waters.
Spectacular
Growth.
Soeren Brogaard, CEO
Statements
The Big Picture 10
We Are Trackunit ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements
The world will need to
invest $9.2 trillion each
year until 2050 to achieve
net-zero emissions in the
built environment.
New
technologies in construction
will completely revolutionize
how we enable and
implement this change.
World Bank.
We are Trackunit
Trackunit enables fleet owners and OEMs in the
o-highway sector to make intelligent, relevant
decisions that boost eciency, raise the
bottom line and deliver sustainability benefits
to the construction industry as a whole.
Trackunit converts machine and equipment data in
real-time to proactively deliver actionable insights
across our ecosystem. It empowers customers with
data-driven intelligence to improve critical business
drivers such as fleet and machine health & utilization,
operator safety and fuel management.
Our industry leading IoT solutions and asset manage-
ment platform benefit the everyday operations of our
customers, supported worldwide from our oces in
What we do
We’ve built a platform for growth
enabling us to serve our customers
through the delivery of powerful,
actionable insights tailored to
their needs.
Denmark, Canada, USA, Singapore, Sweden, Norway,
France, Netherlands, Germany, UK, Australia, and Japan.
Our core Iris platform consolidates data from our
proprietary IoT devices as well as third-party systems,
making it easy to access, analyze and act on data
insights. Access to our Cloud and IoT platform is
provided via tiered customer subscriptions and
add-on applications, regulating the scope, depth,
and access to game-changing insights.
We are a purpose-driven organization with highly-
engaged employees and are on a mission to tackle
long-standing challenges with digital innovation to help
eliminate downtime in construction. This mission is not
only to help the industry to recover from budget and
schedule overruns, but also to re-establish the reputa-
tion of the industry for innovation and leadership.
12We Are Trackunit
The Big Picture ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
a strategy-driven, bigger-picture approach with
rapid learning and feedback loops coming together
to ensure eliminating downtime is at the heart of
everything we do.
It means we care about what our people do and
through our impact conversations, we have created a
clear methodology that fosters their development and
engagement, allows them to play to their strengths, and
incubates collaboration towards our strategic goals.
We see this in practice. As one example, the Trackunit
Inclusivity Diversity and Equity initiative created in
2022, is a bottom-up program driven by our people
and endorsed by the executive board to make sure
Trackunit is putting in place the correct methodologies
and policies to truly incubate inclusivity.
Positive action
That’s enabling us to move beyond words and take
real, positive action towards creating a workforce
for all where every contribution is valued and every
opinion counts. In Trackunit, there is no such thing as
a stupid question.
That solid platform also helps us go to the industry and
seek to create engagement, collaboration and inclusivi-
ty with our peers too where our thought leadership is
well established and respected and where we also give a
stage for industry leaders to speak on people issues and
help build the bandwagon towards positive change.
It means we never sit still. And we take our role as
thought leaders and ecosystem stewards seriously.
It keeps us going. And it gets us up every day. It’s the
Trackunit Way.
The Trackunit Way is a clear set of guiding
principles and methodologies that inter-
play through the working day of every
team member centered on trust, autonomy
and responsibility.
We trust our people. We empower them to take
decisions, to set their course and make the smart
decisions that define their success and make the
cutting-edge contribution to the business.
By putting people first, the Trackunit Way creates a
virtuous circle incubating a powerful culture of inclusivity,
autonomy and responsibility. That plays out in our
innovation-led approach to everything we do based on
an incredibly strong engineering resource that makes up
circa 40% of the workforce which complements our other
talent to create great customer solutions.
Triple focus
Our triple-focus model eectively places the individual
within the wider needs of the organizational ecosystem
and drives impact by person, by team and by the
company as a whole. It brings everyone together on
It’s the
People
13We Are Trackunit
The Big Picture ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
Eliminate Downtime.
Strengthen Construction.
We’ve been steadfast in our aim to
eliminate downtime and, with the industry
on board, believe we’re getting closer to
that goal.
We’re proud to be part of an industry-wide movement
that is increasingly ready and getting ever-better
tooled to eliminate downtime in construction. That’s
because we, with our like-minded peers, believe it is
the fundamental issue facing the industry and only its
successful resolution will re-establish construction as
a force for global progress.
That’s a reputation the industry enjoyed for a long
time but which has been gradually eroded over the
last few decades. Instead of being lauded for the
schools, the roads, the hospitals and other vital
infrastructure that underpin modern life, budget
overruns, pollution-heavy processes and the pressures
of building for an ever-rising global population have
allowed downtime to grip the sector resulting in low
productivity growth and creating the need for a
technological spark.
It manifests in many ways. Construction contributes
38% of all global CO
2
emissions. It’s sometimes been
resistant to digitalization. The sector’s safety record,
while improving, could be better. And a stark gender
imbalance continues to permeate the workforce.
That’s why we’re convinced that by tackling downtime,
the industry can begin to immediately enjoy benefits
that will address these fault lines and reposition
construction in the eyes of the world. In fact, it’s
happening already.
Data insights enable fleet owners to control and
reduce their CO
2
emissions. Digitalization creates obvi-
ous bottom-line eciencies. IoT devices enable safety
precautions limiting risk-taking behavior and providing
secure-access machines. And automated processes
replace burdensome manual tasks.
That pushes us to think not just in terms of being
successful but in being useful. To becoming a positive
catalyst for change. And using the ecosystem to filter
those positive benefits throughout the industry. It’s the
bigger picture. It’s one the industry is actively engaged
in. And it’s one we can all win together.
The Eliminate Downtime model is the essential
DNA of Trackunit enabling an ecosystem that is
intent on addressing ineciency in construction,
connecting stakeholders and addressing society's
challenges together.
Machine Human
Company
Industry
Society
Connectivity
Safety
Sharing
economy
Technology
Resilience
Eliminate
Downtime
Digital twin
Electrification
Autonomous
Stress
Digital adaptation
Training
Business model
Innovation
Data
Sustainability
Recycling
Data ethics
Diversity
Partnerships
Talent
14
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Precise Data.
Actionable
Insights.
Having the data is one thing. Making
it work for the customer in a secure
environment is another. It’s why we
believe our ability to create real
insights enables us to stand out
from the crowd.
see the bigger picture. It means as our connectivity
grows, we are able to provide solutions to very human
problems as well as open up opportunities for new
business and new ways of thinking.
At the micro level, that enables better fleet manage-
ment and smarter decisions that aect the bottom line.
As an example, we collect fuel data in over 120 dierent
data formats across machines brands. Instead of
passing on the problem for the ecosystem to solve, we
harmonize all forms of input into a single, standardized
insight and metric for use by the ecosystem. This
provides a systematic approach to fuel management
and can directly impact CO
2
emissions.
At the macro level, it’s a game changer. Those
thousands of decisions on the ground driven by
harmonized insights add up to a potential tidal wave
of collaborative, positive developments that can direct-
ly impact costs, safety, and the environment in a way
that can also help restore the industry’s reputation as
a force for good.
That’s a value-chain proposition that, through our
secure and extendible platform Iris, creates a virtuous
circle of strong, cost-driven and collaborative-based
solutions that can ultimately help the industry
eliminate downtime and help it get into line with 2050
carbon targets.
It’s ambitious because we’re ambitious. And ambition is
worth investment. Everything we do is predicated on the
need to be useful. And that’s why we’re relentless in our
drive for better, richer and more impactful insights that
makes business better and makes construction better.
Damages
Location
Pre-check
We live in a world of data that is awe inspiring. It can
also be overwhelming.
Without a filter, those numbers mean little. And without
meaning, it’s just noise. That’s why we take that data,
process those numbers and make insights that are
actionable, relevant and drive impact.
At Trackunit, we’re building a secure ecosystem
predicated on taking every individual number and, bit
by bit, putting them together so our customers can
Service
Error
Sensors
15
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The Big Picture ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
Four strategic focus areas
We focus our eorts as part of a broader
purpose to deliver value and growth
across 4 key areas.
On our journey to eliminate downtime, we aspire
to not only drive impact ourselves, but serve as a key
cornerstone for others to drive value creation.
Providing the fuel for broader ecosystem impact,
we are building industry momentum to solve
long-standing challenges and bring the future
closer to today.
01
Accelerating
asset-class
connectivity
02
Geographic
focus and
expansion
03
Customer-
centric value
creation
04
Unlocking
ecosystem
value
The
Strategy
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The Big Picture ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
04
Unlocking ecosystem
value
We humbly admit that the challenges our industry
faces are too large to be solved by one player alone.
It requires collaboration and openness to take on the
full scope of the tasks that lie ahead.
Investment in the extendibility and ability to build
value on top of a common ecosystem platform via our
Software Development Kit continues to unlock new
vectors for growth and impact.
Serving as the stewards of our ecosystem, we seek to
accelerate the full power of the ecosystem by enabling
others to collaborate, engage and create value via our
industry-leading platform. Combined with our deep
connection into OEMs, Rental companies, and Contrac-
tors, we empower our customers to create and consume
ecosystem value to drive a broader impact.
03
Customer-centric value
creation
The industry is quickly approaching the next stage
of evolution in regards to digital maturity. With a
common understanding of the importance of data-
driven insights, enabling customers to securely
convert insights into impact is becoming more and
more paramount.
While our ability to expand the breadth and depth
of insights generated via our ecosystem platform
continues to accelerate, we place customer impact
front and center to guide our innovation eorts.
Supporting customers on their digital journey allows
them to unlock new opportunities to drive impact
across their business, the industry and society.
02
Geographic focus and
expansion
Significant runway remains to drive growth and
impact within our core European and North American
markets. As we continue to connect the disconnected
and welcome new customers into the ecosystem,
our ability to drive impact and enable others will
only grow.
Furthermore, presence in Asia-Pacific-Japan continues
to build the foundation for the next wave of connectivi-
ty growth. Representing a huge market with enormous
future potential, our APJ commitment has served to
solidify our contribution to the industry-wide mission
to Eliminate Downtime.
01
Enabling connectivity
across all assets
Connected assets are actionable assets. Customer
value creation is enabled by the upstream origination
of clean structured data and ensuring integrated
connectivity across all assets to unlock new insights
and value.
In 2021, we launched Kin to unlock new layers of
connectivity. In 2022, we took our ambitions to the
next level with increased focus on deeper integrations
and the capability of our on-site mesh network.
Continuing to expand and facilitate a single connect-
ed ecosystem across all assets classes represents the
next step in connectivity evolution.
Our platform continues to serves as the cornerstone
of a safe, connected ecosystem, enabling 100%
connectivity via our own network, IoT Devices, partner
devices, and OEM ISO feeds.
Our core is grounded in the deep understanding of
o-highway vehicles and other industrial assets, both
enabling and leveraging data-driven insights to fuel
change and impact for our ecosystem. From data
origination to value creation and delivery, our
strategy is centered on four core focus areas:
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The Big Picture ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
Building
a Secure
Ecosystem
The ecosystem is at the heart of all
our eorts to eliminate downtime.
The stronger we build that ecosystem,
the more fit for purpose it will be.
We’re at the core of an ecosystem that connects
equipment, people, processes and stakeholders with a
SaaS-based IoT solution delivering data-rich machine,
fleet and market insights to the network.
Our business model has an in-built resilience based
on the strength of our insight-focused product
development that enables it to withstand harsh macro
environments. Contractors, OEMs and Rentals trust
us because we deliver eciency gains and protect
customer margins in a secure environment despite
spiralling energy and logistics costs.
OEM
Drive business impact through:
Informed aftermarket visibility on
equipment usage for commercial
eorts
Improved profitability on lower
priced machines
OTA connection for aftermarket
services e.g. tech applications
Improve R&D eorts by providing
real-time machine performance data
Rental
Improve operations and
efficiencies by:
Depot optimization driving higher
fleet availability and revenue
Digital workflows connecting teams
across locations
Theft/loss prevention and improved
recovery rates
Limit downtime with predictive
maintenance eorts
Contractor
Reduce downtime and project
costs by:
Identifying under-utilized equipment
Predictive maintenance initiatives
Limiting excessive machine idling
driving higher fuel consumption
Preventing theft and equipment loss
Improve safety through digital access
control and operator integration
E
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a
y
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r
s
Rental
Contractor
OEM
Core customers
Broader ecosystem
Future partnerships
I
n
d
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y
a
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o
c
i
a
t
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o
n
s
18We Are Trackunit
The Big Picture ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
Core customer value is delivered via tailored subscrip-
tion tiers regulating the access to data and insights
with add-on solutions enabling a bespoke approach to
suit every customer need.
Our subscription-only model drives a high share of
recurring revenue at 91.3% in 2022 with deep integra-
tions in customer enterprise IT solutions via APIs.
In 2022, our direct sales channel accounted for the
majority of revenue development, while we continue
to expand and develop our indirect channels and
partner ecosystem.
Our Works With ambition seeks to stoke and facilitate
ecosystem collaboration. Spanning a broad range
of partnership archetypes, the Works With program
provides access to both create and consume eco-
system services and value.
We play a supporting role in facilitating this exchange
to amplify the broader impact of others by providing
common access to a single, secure, platform-based
ecosystem engaged across all players. In particular,
our focus remains on our OEM partners who factory-fit
Trackunit’s IoT solutions to deliver connectivity and
value to our joint customers straight from the factory.
The ‘Works with Trackunit’ partnership facilitates both
a common connectivity platform, and a channel for
partners to accelerate their own digital services.
Premised on the conviction that partnerships make the
most successful digital ecosystems, we believe this can
become a critical dynamic in eliminating downtime.
EcosystemData Origination ServicesCore / Engine
Industry leading
data-lake & platform
Connected ecosystem
empowered to drive
value across
stakeholders via the
single platform.
Flexible service
oering able to address
broad range of
customer needs.
Single extendable
platform powering the
entire ecosystem.
Industry leading data
lake and platform.
.bn data points
cleaned and harmonized
on a daily basis to fuel
value creation.
OEM Rental Contractor
Third-party players System integrators Industry associations Equipment dealers
Single extendable platform
Al driven rules / analytics engine
Clean, structured, decision-grade data-lake
Data cleaning and harmonization
Software applications
IntegrationsAPIs
Fit-for-purpose loT
solutions with global
coverage, enabling
deep data origination
and local on-site
mesh-network
connectivity.
Machines People Documentation Third-party
data
Tools
Parts &
attachments
19We Are Trackunit
The Big Picture ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
Harnessing
IoT
Having a purpose is one thing. Making
that purpose work is another. That’s why
we’re so committed to innovation and
creating a product line that is truly useful
to the industry.
We are committed to innovation. Our R&D investment
is a significant part of our annual budget and we’re
only just beginning to explore the enormous potential
of IoT as we deliver product with the express purpose
of driving impact in our market.
Our core solutions help customers manage their fleets
to ensure the correct and ecient use of machinery
and non-powered equipment, reduce CO
2
emissions
and oer timely, actionable insights on health &
safety. With a tailored and flexible approach,
customers can adapt solutions to their requirements
leveraging the Trackunit platform as part of their
digital journey.
Continuous advancement in ecosystem digitalization
enables Trackunit to become a key partner on the
customer journey building the relationship with the
introduction of ever-more sophisticated products at
their pace. For OEMs, contractors, and rental customers,
it means a flexible suite of solutions that can allow their
business to develop in new and exciting ways and help
them play their role in eliminating downtime.
Trackunit Iris
The cornerstone of our value creation, Trackunit Iris
is built for the future. Designed to be safe, secure,
and scalable, Iris allows connectivity to occur
anywhere. With over 1 million connected assets and
more than 1 billion data points added daily, Iris'
ability to aggregate mixed-fleet data on a single
platform, provides a single source of truth to foster
new businesses and accelerate connectivity.
Here’s a taste of
some of the things
we do.
Trackunit Manager
Trackunit Manager is the purpose-built fleet manager
solution for construction, connecting, collecting, and
presenting real-time mixed fleet data to customers
on a single interface. It is total overview. Total control.
And complete focus.
Trackunit manager allows customers to solve daily
pain points by (1) monitoring machines at all times
and preventing unauthorized access, (2) Receiving
intelligent notifications about location, maintenance,
and damages, (3) Remotely diagnosing machines by
using live data, and (4) pinpointing and addressing
irregularities in fleet-wide performance.
20We Are Trackunit
The Big Picture ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
Trackunit Kin
Trackunit Kin is a Bluetooth 5.2 IoT
device that leverages our Bluetooth
mesh network across all asset
classes. It is simple yet powerful,
with activation requiring less than
a minute with a vastly extended
ecosystem reach.
Connecting to either the Trackunit
Go app or a Trackunit Raw
gateway, Kin-enabled equipment
can be located up to a 400-meter
range enabling operators to guard
against theft and eliminate downtime
through the real time localization
of smaller tools and equipment.
Trackunit Go
Trackunit Go allows seamless communication
between the operator, service technician and
site administrator, delivered via a mobile
interface regardless of location. Because the
data is at their fingertips, Go enables on-the-
spot reporting, remote diagnostics, and on-site,
fleet-management capabilities.
Trackunit Raw
Market bestseller Trackunit Raw is a compact
cellular IoT device, which delivers stable,
secure, and reliable connectivity. Coverage is
global and as an industry-trusted performer, it
is the ideal piece of IoT kit for future-proofing
fleets and growing businesses.
Robust, versatile, and secure, Raw is fit for
all kinds of weather and made to seamlessly
connect all types of equipment to the Iris
platform. Built-in Bluetooth technology also
creates a local mesh network, serving as a
gateway for non-cellular IoT devices such as
Kin and third-party Bluetooth tags.
Trackunit On
Trackunit On is the mobile application that
connects people to machines, creating an
on-site interface allowing operators to conduct
checklists and inspections, report, and log
machine issues, and improve job-site safety.
All that via a smartphone. For users, it is a
complete fleet management tool at their disposal.
Spot
Introduced in Q3, 2022, the second-generation
Trackunit Spot is a 5G-ready solution that has
transformed the non-powered construction
equipment sector. Oering fast setup and instant
connectivity, it bridges a gap between Trackunit
Raw and Trackunit Kin and has helped complete
the circle on the connectivity loop.
21We Are Trackunit
The Big Picture ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
To decarbonize, all
stakeholders need to take
greater responsibility.
Doing so requires getting
the right data to the
right stakeholders at
consequential stages of
decision making.
UN – 2022 Global Status Report for Buildings and Construction.
ESG
Trackunit has several ESG initiatives in place
and will aim to constantly review, consolidate
and improve its policies, year-by-year.
Customers, employees, investors and society at
large rely on Trackunit to balance the interests
of all stakeholders. We give equal weight to all
aspects of ESG and aim to be rigorous in our
implementation of all our ESG-related policies.
Environmental: Trackunit is a SaaS company that
delivers IoT solutions to customers. It enables them to
record and monitor utilization and carbon emissions
with a view to cutting back on greenhouse gases and
instilling an industry-wide dynamic that will help
construction meet global carbon emissions goals and
help restore its reputation as a force for progress.
(see page 24 for more).
ESG: The Executive
Summary
Societal: Trackunit has a rigorous employee-led
program in place called TIDE that encourages diversity
and inclusion, rejects all forms of discrimination and
is profoundly aimed at addressing any imbalances
within the organization. We also seek through various
platforms to build a consensus in the industry towards
inclusion enabling construction to become a more
attractive workplace for everyone. (see page 27
for more).
Governance: Trackunit seeks to be a trustworthy
business that follows all relevant privacy restrictions
in respect of national and international law to enable
safe and secure data sharing with customers. While
we are actively invested in creating an ecosystem that
enables business, we constantly guard and crosscheck
our security to ensure we are in compliance with
regulation and are taking all eective measures
against criminal activity. (see page 30 for more).
23ESG
The Big Picture We Are Trackunit Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
Cutting Emissions.
Driving Change.
This year, we’ve made real, measurable
improvements on emissions reporting.
That’s enabling customers to make
their own contribution in the battle
against downtime.
We’ve talked a good game on sustainability, but 2022
was the year where we backed it up with significant
developments in our ability to help customers report
on, and act on, their CO
2
emissions.
Trackunit delivers market-leading emissions reporting
across entire fleets. Our intuitive dashboard is
tailored to customer needs with seamless integration
and data filters enabling reporting at the touch of
a button.
That means fleet-wide and machine-level fuel
usage and emissions tracking to unlock cost savings,
meet the reporting requirements of government-led
projects that have stringent, non-negotiable
sustainability criteria and help in the process towards
establishing benchmarking on emissions targets.
Our plug-and-play setup is easy to use and the ability
to showcase data that matters is also enabling fleet
owners to win contracts where the environmental
premium is set high.
We also continue to invest resources into our R&D
for a common metric that will help create an industry
benchmark that works across the board and
standardizes reporting.
We recognize that we are in a battle against time and
we’re not even half way down this road. But the more
we can help our customers, the more we can impact
on society, and the more construction can accelerate
the process towards restoring its reputation as a force
for good.
It’s how we as an industry will put ourselves on a
course to meet our 2050 CO
2
emissions targets
through collaboration and data-driven action. It’s why
we’ll keep pushing. And it’s why we’ll seek to build
partnerships across the industry to keep targets in
focus and build the solutions that work tomorrow.
We invest resources into
our R&D for a common
metric that will help
create an industry
benchmark that works
across the board and
standardizes reporting.
Our intuitive dashboard
is tailored to customer
needs with seamless
integration and data
filters enabling reporting
at the touch of a button.
24ESG
The Big Picture We Are Trackunit Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
In 2022 Trackunit became a member
of the Committee for European
Construction Equipment.
Trackunit took to the stage
at the IPAF forum in Rome
in September 2022.
First-ever Trackunit
NEXT forum.
Trackunit held regular
downtime-focused events in Italy
in June and Florida in November.
In November, we implemented our
Trackunit Inclusivity, Diversity &
Equity (TIDE) program.
Catalyzing the Agenda
We additionally held the first-ever Trackunit NEXT
forum in 2022 where we examined where the industry
could be headed in the future as the ecosystem
develops, inviting our colleagues in construction to
participate and make their contribution to the debate.
With regular downtime-focused events in Italy in June
and Florida in November, it was also a year where our
eorts on our overriding purpose gained yet more
traction and yet more buy-in from the global industry.
Tackling this blot on construction’s landscape continues
to be a real industry driver and we won’t be relenting
in our commitment to keep this top of the agenda.
And finally, we’re fully invested in the push for ever
greater inclusivity embodied by the TIDE program.
We will learn, measure and check in systematically
as part of the program to make sure we’re on target.
By making sure we have our own house primed for
inclusivity, we believe we can influence the narrative
and consolidate the drive for a more diverse construc-
tion sector over the coming generations.
To that end, we were very proud to become a member
of the Committee for European Construction
Equipment in 2022 adding our perspective on a host
of issues like regulation, inclusivity, sustainability,
cybersecurity and data sharing.
Trackunit also took to the stage at the IPAF forum in
Rome in September 2022 to push the critical role
telemetry and IoT can play down the line on safety,
highlighting how we can do even better through
access control to foster on-site security.
Everything we do is underpinned by the
eliminate-downtime agenda, but we also
fully understand that only industry-wide
action can truly deliver real change.
We have a voice and we know our voice is heard
through our thought leadership and strong press
coverage, but if we want real, eective change in
construction, we know we can’t go it alone. Only
through collaboration and industry-wide initiatives
can we make a dierence and make positive change.
25ESG
The Big Picture We Are Trackunit Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
A common, standardized metric on
emissions reporting throughout
construction would change the game.
We’re working on it.
We’ve been working on creating an industry standard
metric for construction for some time now and it’s an
eort that we continue to allocate resource to.
That eort has crystallized into the search for the
equivalent of a Power Usage Eectiveness metric
— eectively a measure of the energy eciency of
data centers — as a way to standardize all sustain-
ability reporting through the construction industry.
IoT solutions are by their very nature data driven and
we want to pull together all those disparate dots and
shift the industry towards a standard measurement
metric that can be used across the board. Such a
metric will help change the idle/productivity ratio
and significantly boost the ecient use of energy
on a day-to-day basis.
Let’s be clear here. This is dicult. We should know
as we’ve been on this path for some time. But we
believe this is a challenge we should be looking
to overcome because it will be the game changer.
In the meantime, we will continue to make the micro
changes on emissions reporting that we have already
outlined while simultaneously driving towards this
bigger-picture creation of a PUE-type metric.
That means researching. It means testing. Experi-
menting. Analyzing. And learning. With eliminating
downtime at the core of everything we do, it makes
absolutely perfect sense to pursue this. We’ll keep
you updated.
Finding a Standard
Metric
26ESG
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27ESG
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28ESG
The Big Picture We Are Trackunit Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
29ESG
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The Big Picture We Are Trackunit Financial Review Consolidated Financial Statements Parent Company Financial Statements Statements
The market size for IoT in
construction was valued
at $8.99 billion in 2021.
It is expected to reach
$29.72 billion by 2030,
growing at a CAGR of
14.2% from 2022.
Straits Research.
Financial Review
Financial Review
Developments in activities and financial
aairs 2022
2022 has been a year of integration. On November 18,
2021, Trackunit acquired the Industrial IoT division of
ZTR to better serve the growing demands of the
construction industry. Trackunit added 125 employees,
more than 450,000 connected assets and throughout
all of 2022 there has been a high focus on integrating
the two businesses.
To eliminate downtime in the industry and to better
serve our customers we believe in transparency and a
high degree of communication. Therefore, we have
launched our Trackunit Product Portal in the summer
2022. The portal is an open scalable forum where
Trackunit can collaborate with customers, partners and
the construction industry on product updates and
future products – a direct access to Trackunit's
innovative engine room with a transparent view of
product roadmaps.
In 2022 we have increased FTE with 32 new employees
in total all over the world and the group now employs
more than 375 people globally.
Further, we have taken steps to simplify our legal
structure. In Denmark there was a merger of Trackunit
ApS with the companies M-tec Holding Danmark ApS
and M-tec Danmark ApS with retrospective eect for
accounting purposes at 1 January 2022 and with
Trackunit ApS as the continuing company. In the UK
we have taken steps towards consolidating our UK
business with Trackunit Ltd and striking o Trackunit
Telematics Ltd and Fern Capital Ltd. As a result, the
comparative figures are restated in accordance with
the adjusted pooling-of-interests method.
The income statement shows a positive EBITDA of
DKK 178m but a negative net profit of DKK 14m. The
profit is materially influenced by costs related to the
acquisitions above and by the high inflation during
2022, that have aected cost prices.
The results for the year are further impacted by
amortization of intangible assets and financial
expenses related to the above acquisitions.
The financial result for 2022 is in line with the
expected. In the financial statement for 2021 Trackunit
expected revenue to be in the range of DKK 800-
1,000m and EBITDA in the range of DKK 125-200m. The
financial result for 2022 is considered satisfactory.
Trackunit ApS
M-tec Danmark ApS
M-tec Holding
Danmark ApS
To get a more simplified legal
structure we have merged
companies in Denmark
and taken steps towards
consolidating our UK
business. As a result, the
comparative figures are
restated in accordance
with the adjusted pooling-
of-interests method.
32Financial Review
The Big Picture We Are Trackunit Consolidated Financial Statements Parent Company Financial Statements Statements ESG
Significant changes in operations
and financial matters
There are no other significant changes in operations and
financial matters that have aected recognition and
measurement of the Groups results and financial status.
Unusual conditions that aect
recognition and measurement
There are no unusual factors that have aected
recognition and measurement of the Groups results
and financial status.
Outlook
Management is positive going into 2023 and by
delivering on the corporate strategy revenue for 2023
is expected in the range of DKK 1,100-1,300m and
EBITDA in the range DKK 250-350m.
Significant assumptions
and uncertainties
There are no material conditions and uncertainties
that aect the Group’s results and balance sheet.
Risk factors
Activities in foreign countries and hereby earnings,
exchange rates and interest rates of various currencies
aect cash flows and equity. Adjustment of invest-
ments in subsidiaries and associates that are
independent entities, are recognized directly in equity.
Throughout 2022 the interest rates have been
increasing. To secure against even further increase
we have entered into an interest cap agreement.
Currency risks related to sales in transactional
currencies dierent from DKK are not hedged while
overall cashflow in dierent currencies are to some
degree aligned.
Development activities
The development activities primarily include develop-
ment of next generation Trackunit services, which
includes continued development of features to the
software platform, incorporating reporting, streaming
API (real time data) and an improved administration
module. Also in development is Next generation access
control and Update Machines Over The Air (OTA) – all
described in the Roadmap.
Significant events after the balance
sheet date
On January 1 2023 Trackunit acquired the German
Con-Tech company Flexcavo GmbH. Flexcavo oers
a unique software solution to the contractor segment
which therefore provides a perfect fit for the Trackunit
product suite. The acquisition has no eect on the
2022 financials.
The Group does not have customers or aliates in
either Ukraine or Russia and therefore, we are not
directly aected by the war in Ukraine.
Outlook Net revenue (000' DKK)
Outlook EBITDA (000' DKK)
1,100 – 1,300
250 – 350
991
178
506
105
383
102
2020
2020
2021
2021
2022
2022
Outlook 2023
Outlook 2023
33Financial Review
The Big Picture We Are Trackunit Consolidated Financial Statements Parent Company Financial Statements Statements ESG
000' DKK Notes 2021
Revenue from contracts with customers 2 990,963 506,016
Cost of providing services (405,211 ) (168,223 )
Gross Profit 585,752 337,793
External costs 5 (108,871 ) (49,992 )
Other operating expenses (57 ) 2
Employee costs 3 (299,086 ) (182,620 )
Earnings before depreciation, amortization and
impairment (EBITDA), and before special items 177,739 105,182
Special non-recurring items 6 (31,245 ) (52,242 )
Depreciation, amortization costs and impairment loss of
property, plant and equipment and intangible assets 10, 11, 12 (160,254 ) (65,185 )
Earnings before interest and tax (EBIT) (13,761 ) (12,245 )
Finance income 7 9,018 787
Finance costs 7, 12 (19,314 ) (9,689 )
Earnings before tax (EBT) (24,058 ) (21,147 )
Income tax expense 8 10,521 (8,258 )
Profit/(Loss) for the period (13,537 ) (29,404 )
000' DKK Notes 2021
Profit/(loss) for the period (13,537 ) (29,404 )
Other comprehensive income
Items that may be reclassified to profit or loss
Exchange dierences regarding subsidiaries in another currency 20,130 4,313
Change in value of cash flow hedges
– Gains/loss on cash flow hedges 0 859
Income tax relating to these items 0 (189 )
Other comprehensive income for the period, net of tax 20,130 4,983
Total comprehensive income for the period 6,593 (24,421 )
Consolidated Statement of Profit and Loss
1 January – 31 December
Consolidated Statement of Comprehensive Income
1 January – 31 December
35Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
Consolidated Balance Sheet – 31 December
Assets
Consolidated Balance Sheet – 31 December
Equity and Liabilities
' DKK Notes
Non-current assets
Intangible assets 1,997,074 2,094,607
Property, plant and equipment 9,520 7,593
Right-of-use assets 38,539 24,760
Deferred tax assets 42,781 20,643
Connected devices 217,605 210,701
Deposits 2,226 1,757
Total non-current assets 2,307,745 2,360,062
Current assets
Inventories 40,449 37,789
Trade receivables , 181,957 141,418
Receivables from group enterprises 171,468 33,539
Connected devices 153,614 107,842
Other financial assets at amortised cost 13,650 2,572
Other current assets 47,402 14,617
Cash and cash equivalents 37,418 94,964
Total current assets 645,958 432,741
Total assets 2,953,703 2,792,802
' DKK Notes
Share capital 500 500
Share premium 1,140,938 1,140,938
Other reserves 20,765 635
Retained earnings 217,225 224,945
Total equity 1,379,428 1,367,018
Lease liabilities , 28,343 18,264
Deferred tax liabilities 189,083 195,802
Deferred revenue 454,022 272,454
Total non-current liabilities 671,448 486,520
Lease liabilities , 10,591 6,803
Trade and other payables 116,908 108,476
Payables to group enterprises 310,988 374,617
Current income tax liabilities 17,912 17,723
Deferred revenue 446,428 431,645
Total current liabilities 902,827 939,264
Total liabilities 1,574,275 1,425,784
Total equity and liabilities
36Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
Notes
Critical accounting estimates and judgements 1
Share-based payment 4
Related parties 17
Commitments and contingent liabilities 18
Business combinations 19
Financial risk management 20
Events after the balance sheet date 21
Group companies 23
Basis of preparation 24
000' DKK
Share
capital
Share
premium
Other reserves –
Foreign currency
translation
Other reserves –
Reserve for
hedges
Retained
earnings
Total
equity
Balance at January 500 1,140,938 635 0 224,945 1,367,018
Profit for the period 0 0 0 0 (13,537 ) (13,537 )
Other comprehensive income 0 0 20,130 0 0 20,130
Total comprehensive income for the period 0 0 20,130 0 (13,537 ) 6,593
Transactions with owners in their capacity as owners
Share-based payment 0 0 0 0 5,817 5,817
Balance at December 500 1,140,938 20,765 0 217,225 1,379,428
000' DKK
Share
capital
Share
premium
Other reserves –
Foreign currency
translation
Other reserves –
Reserve for
hedges
Retained
earnings
Total
equity
Balance at January 500 102,800 (852 ) (670 ) (56,585 ) 45,193
Profit for the period 0 0 0 0 (29,404 ) (29,404 )
Other comprehensive income 0 0 4,313 670 0 4,983
Total comprehensive income for the period 0 0 4,313 670 (29,404 ) (24,421 )
Transactions with owners in their capacity as owners
Net eect from merger and acquisition under
the pooling-of-interests method 0 0 (2,826 ) 0 310,935 308,109
Increase in share capital 0 1,038,138 0 0 0 1,038,138
Balance at December 500 1,140,938 635 0 224,945 1,367,018
Consolidated Statement of Changes in Equity
January 1 – December 31
37Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
Consolidated Cash Flow Statement
1 January – 31 December
000' DKK Notes 2021
Earnings before interest and tax (EBIT) (13,761 ) (12,245 )
Depreciations and amortizations 160,254 65,185
Non-cash items 5,874 (2 )
Change in net working capital 22 56,379 414,137
Cash flows from primary operating activities 208,745 467,074
Received interests 7,176 460
Paid interests (26,433 ) (5,225 )
Paid income taxes (17,315 ) (11,182 )
Cash flow from operating activities 172,173 451,127
Purchase of property, plant and equipment (7,023 ) (1,481 )
Sale of property, plant and equipment 75 2
Purchase of intangible assets (22,762 ) (16,735 )
Change in deposits (467 ) 21
Business acquisitions (net of cash acquired) 0 (1,297,405 )
Cash flow from investing activities (30,177 ) (1,315,597 )
000' DKK Notes 2021
Cash flow from investing activities (,) (,,)
Repayments to credit institutions 0 (168,569 )
Capital increase 0 1,038,140
Other financing to/from Group enterprises 201,809 0
Lease principal payments (9,626 ) (6,392 )
Cash flow from financing activities (211,435 ) 863,180
Net cash flow for the year (69,439 ) (1,290 )
Cash and cash equivalents, beginning of the period 94,964 97,600
Unrealized exchange rate gains and losses 11,894 (1,347 )
Cash and cash equivalents, end of the year 37,418 94,964
The cash flow statement cannot be derived from
the published financial information only.
Cash and cash equivalents 37,418 94,964
38Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
40 Note 1 Critical Accounting Estimates and Judgements
41 Note 2 Revenue from Contracts with Customers
43 Note 3 Sta Costs
44 Note 4 Share-based Payment
45 Note 5 Audit Fees
45 Note 6 Special Non-Recurring Items
46 Note 7 Financial Income and Expenses
47 Note 8 Income Tax
49 Note 9 Distribution of Profit/Loss
50 Note 10 Intangible Assets
54 Note 11 Property, Plant and Equipment
55 Note 12 Leases as Lessee
56 Note 13 Inventories
57 Note 14 Trade Receivables
58 Note 15 Financial Assets and Liabilities
59 Note 16 Share Capital
59 Note 17 Related Parties
59 Note 18 Commitments and Contingent Liabilities
60 Note 19 Business Combinations
61 Note 20 Financial Risk Management
63 Note 21 Events After the Balance Sheet Date
63 Note 22 Changes in Net Working Capital
63 Note 23 Group Companies
64 Note 24 Basis of Preparation
Index of
Consolidated Notes
39Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
1. Critical Accounting Estimates and Judgements
The preparation of the Group’s consolidated financial
statements requires management to make judgements,
estimates and assumptions that aect the reported
amounts of revenues, expenses, assets and liabilities,
the accompanying disclosures, and the disclosure of
contingent liabilities at the date of the consolidated
financial statements. Estimates and assumptions are
continually evaluated and are based on management’s
experience and other factors, including expectations of
future events that are believed to be reasonable under
the circumstances. Uncertainty about these assump-
tions and estimates could result in outcomes that
require a material adjustment to the carrying amount of
assets or liabilities aected in future periods.
In particular, the Group has identified a number of
areas where significant judgements, estimates and
assumptions are required. Further information on each
of these areas and how they impact the various
accounting policies are described and highlighted
separately with the associated accounting policy note
within the related qualitative and quantitative note, as
described below.
Revenue recognition
Revenue is recognized when promised goods or
services are transferred to customers in an amount
that reflects the consideration to which we expect to
be entitled in exchange for those goods or services.
We determine revenue recognition through the
following steps:
1. identification of the contract, or contracts,
with a customer;
2. identification of the performance obligations
in the contract;
3. determination of the transaction price;
4. allocation of the transaction price to the
performance obligations in the contract; and
5. recognition of revenue when, or as, we satisfy
a performance obligation.
We oer subscriptions to access our Cloud and IoT
platforms. Customers subscribe to one or more
Applications which includes data that is primarily
provided by various proprietary connected device access
points, including connectivity sensors. Our Cloud and
IoT platforms and the related connected device access
points are highly interdependent and interrelated and
represent a combined performance obligation.
The combined performance obligation is satisfied over
time, as we continually provide access to and fulfill our
obligation to the customer over the subscription term.
Accordingly, the fixed consideration related to the
combined performance obligation is recognized on a
straight-line basis over the contract term, beginning on
the date that access to the Cloud and IoT platforms or
specified application and connected device is provided.
Connected devices
We capitalize connected devices associated with
subscription contracts. These costs are directly related
to customer. These contract fulfillment costs are
amortized over a period of benefit of three years.
We determined the period of benefit by taking into
consideration the expected life of the connected
device, the connected device’s warranty period, past
experience with customers, the duration of our
relationships with our customers and other available
information.
Acquisition of enterprises and activities
In connection with acquisition of enterprises and
activities the fair value of identifiable assets, liabilities
and contingent liabilities is measured. Estimation of
fair value mainly applies to intangible and tangible
assets, inventories, and deferred tax hereof. The
estimation of fair value is related to Management
estimates which are based on the expected future
earnings of the assets. For a significant portion of the
assets and liabilities there is no active market that can
be used for determining the fair value. This applies
particularly to intangible assets acquired such as
customer relations and trademarks. The estimation of
fair value is based on an estimate and may therefore
be subject to uncertainty and may subsequently be
adjusted up to one year after the end of the year of
the acquisition.
Impairment of goodwill and
customer relations
Determining whether goodwill and customer relations
are impaired requires an estimation of the value in use
of the cash generating units to which goodwill and
customer relations have been allocated. The value in
use calculation requires the directors to estimate the
future cash flows expected to arise from the cash-gen-
erating unit and a suitable discount rate to calculate
present value. Where the actual future cash flows are
less than expected, a material impairment loss may
arise. The key assumptions used in the impairment
tests of goodwill and customer relations are disclosed
in note 10.
Leases
When determining the present value of lease assets
and lease liabilities the Group make estimations
regarding amortization period based on expected
useful lives and internal interest.
Deferred tax
Management’s judgement is required to determine the
amount of deferred tax assets that can be recognized,
based upon the likely timing and the level of future
taxable profits. Judgement is based on factors such as
historical profits and approved budgets.
40Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
2. Revenue from Contracts with Customers
§ Accounting policy
Revenue recognition
The Group generates revenue from subscriptions to
access its cloud-hosted platform whereby the
customer is charged a subscription fee for access for
a specified term. Subscription agreements contain
multiple service elements for one or more of
Trackunit’s cloud-based Applications via mobile
app(s) or website that enable data collection and
provide access to the cellular network, one or more
wireless gateways and other devices (collectively,
“connected devices” or “IoT devices”), support
services delivered over the term of the arrangement
and warranty coverage. The Group’s arrangements
are generally sold as non-cancelable subscriptions
and have contract terms typically for three to five
years in length. The Group determines revenue
recognition through the following steps:
Identification of the contract, or contracts,
with a customer
A contract with a customer exists when
• The Group enters into an enforceable contract
with a customer that defines each party’s rights
regarding the goods or services to be transferred
and identifies the payment terms related to these
goods or services,
• The contract has commercial substance, and
• The Group determines that collection of
substantially all consideration for goods or
services that are transferred is probable based
on the customer’s intent and ability to pay the
promised consideration.
Identification of the performance obligations in
the contract
Performance obligations promised in a contract are
identified based on the goods or services that will
be transferred to the customer that are both capable
of being distinct, whereby the customer can benefit
from the goods or services either on their own or
together with other resources that are readily
available from third parties or from Trackunit, and
are distinct in the context of the contract, whereby
the transfer of the goods or services is separately
identifiable from other promises in the contract.
To the extent a contract includes multiple promised
goods or services, Trackunit applies judgment to
determine whether promised goods or services are
capable of being distinct in the context of the
contract. If these criteria are not met, the promised
goods or services are accounted for as a combined
performance obligation. Trackunit has determined
that its integrated solution represents a combined
performance obligation as the cloud-based
Applications and connected devices, individually,
are not distinct within the context of customer
contracts because they are highly interdependent
and interrelated.
Trackunit has certain accessories sold in connection
with its integrated sensor solution, which have been
determined to be separate performance obligations.
Also, consultancy services and installation of the IoT
devices are considered to be separate performance
obligations.
Determination of the transaction price
The transaction price is determined based on the
consideration to which Trackunit will be entitled in
exchange for transferring goods or services to the
customer. Such amounts are stated within the
customer contracts.
Allocation of the transaction price to the
performance obligations in the contract
If the contract contains a single performance
obligation, the entire transaction price is allocated to
the single performance obligation. Contracts that
contain multiple performance obligations require an
allocation of the transaction price to each perfor-
mance obligation based on a relative standalone
selling price (SSP) basis. The Group determines SSP
based on the price at which the performance
obligation is sold separately. If the SSP is not
observable through past transactions, Trackunit
estimates the SSP taking into consideration available
information, such as market conditions and internally
approved pricing guidelines related to the perfor-
mance obligations.
Recognition of revenue when or as Trackunit
satisfies a performance obligation
Trackunit satisfies substantially all of its perfor-
mance obligations over time. Specifically, the
combined cloud-based application and connected
device performance obligation and related support
services and warranty coverage represent stand-
ready performance obligations provided throughout
the term the customer has access to the platform.
Revenue recognition commences ratably when
control of the services is transferred to the custom-
ers, in an amount that reflects the consideration that
Trackunit expects to receive in exchange for those
services over the contractual term. Other revenue is
earned through the sale of replacement devices, as
well as related shipping and handling fees and
professional services fees for consulting or installa-
tion services.
41Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
' DKK EMEA US APJ Total
Timing of revenue recognition
At a point in time , , ,
Over time , , , ,
Total revenue , , , ,
' DKK EMEA US APJ Total
Timing of revenue recognition
At a point in time , , ,
Over time , , ,
Total revenue , , ,
' DKK
Non-current
contract liabilities –
Deferred revenue , ,
Current contract
liabilities –
Deferred revenue , ,
, ,
' DKK
Deferred revenue
beginning of period , ,
Revenue recognized
that was included in
deferred revenue
at the beginning
of the period (,) (,)
Acquired deferred
revenue ,
Deferred revenue
invoiced in the period , ,
Deferred revenue
end of period , ,
Revenue recognized in relation to deferred revenue
The following table shows how much of the revenue
recognized in the current reporting period relates to
carried-forward contract liabilities and how much
relates to performance obligations that were satisfied
in a prior year.
Liabilities related to contracts with customers
The group has recognised the following assets and
liabilities related to contracts with customers:
§ Accounting policy
Deferred revenue
Deferred revenue represents amounts billed to
customers or payments received from customers for
which revenue has not yet been recognized. Deferred
revenue consists of prepayments made by customers
for future periods. A portion of customer contracts is
paid in advance for the full, multi-year term. Additional-
ly, Trackunit enables its customers to prepay all, or part,
of their contractual obligations monthly, quarterly, or
annually. As a result, the deferred revenue balance does
not represent the total contract value of all multi-year,
non-cancelable subscription agreements. The current
portion of deferred revenue represents the amount that
is expected to be recognized within one year of the
consolidated balance sheet date.
Cost of revenue
Cost of revenue consists primarily of the amortization
of the cost of capitalized connected devices, software
hosting-related costs as well as connectivity cost for
telecom services.
Costs to obtain and fulfill a contract
For typical sales arrangements, Trackunit capitalizes
the cost of connected devices sold to customers upon
shipment and the capitalized cost is recorded as
connected devices on Trackunit’s consolidated
balance sheet. Connected devices are amortized over
a period of benefit of three years. Trackunit deter-
mined the period of benefit by taking into consider-
ation the expected life of the connected device, the
connected device’s warranty period, past experience
with customers, the duration of Trackunit’s relation-
ships with its customers, and other available
information. Amortization of these costs is included in
cost of revenue on the consolidated statements of
operations and comprehensive loss.
42Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
3. Sta Costs
' DKK
Wages and salaries , ,
Termination benefits
Social security costs , ,
Pension costs, defined contribution plans , ,
Other employee costs , ,
Total sta cost , ,
Average number of full time employees
' DKK
Salaries and other short-term employee benefits , ,
Post-employment benefits ,
Total sta cost for Key Management , ,
Compensation to the Board of Directors and Executive Management
Compensation to the Board of Directors
Compensation to the Executive Management , ,
, ,
Key management compensation
Key Management includes Board of Directors,
Executive management as well as executive manage-
ment in key aliates. The compensation paid or
payables to key management for employee services
is shown to the right:
§ Accounting policy
Salary costs comprise of salaries, social security
contributions, pension contributions and other
sta related costs. Sta costs are recognized in
the financial year during which the employees
performed the related work.
43Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
4. Share-based Payment
Outstanding warrants January
Granted during the year ,,
Forefeited during the year
Outstanding warrants December ,,
To attract and retain employees Trackunit has
established an incentive program for all employees in
2022. The purpose is to share the value creation
eventually to be realised at the time of an exit with
employees and support retention until then.
The warrant program is an equity settled programme
established in March 2022. The vesting period is
expected to be 4 years starting from the grant date.
The programme comprises a total of 1,520,000
warrants at 31 December 2022 (2021: 0). Each warrant
gives the holder right to share capital of DKK 0.01
nominal value in the ultimative parent company
Galaxy UK Topco Ltd.
The total number of warrants granted in 2022 was
1,520,000. The total fair value of the progamme is
DKK 5.8m.
The valuation is based on the following assumptions:
• Vesting period: 4 years
• Expected volatility: 44% - based on peer group
analysis
• Risk free interest rate: 2,7%
Total expenses arising from the incentive programme is
DKK 5.8m and is recognized as sta cost.
§ Accounting policy
The group operates a equity-settled, share-based
compensation plan, under which the entity receives
services from employees as consideration for equity
instruments (warrants) of the group.
The fair value of the employee services received in
exchange for the grant of the warrants is recognized
as an expense. The total amount to be expensed is
determined by reference to the fair value of the
warrants granted including any market performance
conditions excluding the impact of any service and
non-market performance vesting conditions and
including the impact of any non-vesting conditions.
The fair value of the warrants is determined using
a Black Scholes valuation model.
The total expense is recognized over the vesting
period, which is the period over which all of the
specified vesting conditions are to be satisfied. At the
end of each reporting period, the group revises its
estimates of the number of warrants that are
expected to vest based on the non-market vesting
conditions and service conditions. It recognizes the
impact of the revision to original estimates, if any,
in the income statement, with a corresponding
adjustment to equity.
44Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
5. Audit Fees
' DKK
Statutory audit , ,
Audit-related services
Tax advisory services
Other services
Total audit fees , ,
6. Special Non-Recurring Items
' DKK
Consultancy ,
Restructuring ,
M&A , ,
Total special non-recurring items , ,
§ Accounting policy
Special non-recurring items consist of costs and
income of a one-o nature in relation to the
Group's primary activities. Special items relate to
M&A activities, restructuring costs, costs regarding
integration and significant non-recurring items
including termination benefits related to retirement
of members of the executive management.
Special non-recurring items include cost for M&A of
Flexcavo GmbH and of the Industrial IOT division of
ZTR Control Systems, LLC, ZTR Holdings LLC and Trac
Rail Inc. M&A cost includes external cost for lawyers,
advisors, and auditors.
Consultancy cost includes cost for implementation of
a new ERP system. The project has been ongoing
during 2022 with a go-live date in November 2022.
Due to the global supply shortage of computer chips
and other electronic components, the company has
incurred increased costs of DKK 31.1m which is
included under the cost of providing services.
The fair value of the incentive program to all of
Trackunits employees amounts to DKK 5.8m and is
recognized as salary cost.
Audit fee for non-group elected auditors amounts to
DKK 0.7m (2021: DKK 0.5m).
45Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
7. Financial Income and Expenses
§ Accounting policy
Financial income and expenses comprise interest
income and expense, realized and unrealized
exchange gains and losses on transactions in
foreign currencies, amortization of financial assets
and liabilities as well as surcharges and refunds
under the on-account tax scheme. Financial income
and expenses are recognized at the amounts
relating to the financial year.
' DKK
Interest income, banks
Exchange rate adjustments ,
Interest received from group enterprises
Other interest income
Total financial income ,
Interest expenses, mortgage debt and borrowings ,
Interest and finance charges for lease liabilities ,
Loan fee amortizations ,
Exchange rate adjustments
Interest paid from Group enterprises , ,
Other financial expenses, including bank fees , ,
Total financial cost , ,
46Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
8. Income Tax
' DKK
Current tax on profits for the year , ,
Current tax on profits for prior years
Total current tax , ,
Origination and reversal of temporary dierences (,) (,)
Total deferred tax (,) (,)
Income tax expenses for the period (,) ,
Profit before tax (,) (,)
Computed % , ,
Tax eects of:
Eect of income/expenses that is exempt from taxation (,) (,)
Eect of not recognized tax assets
Eect of dierent tax rates of subsidiaries operating in other jurisdictions ,
Eect of opening balance adjustment to deferred tax ,
Eect of tax on profit for prior years () ()
Other , ()
Tax charge , (,)
Income tax expenses for the period , (,)
The tax charge relating to components of other comprehensive
income is as follows:
Cash flow hedges ()
Other comprehensive income ()
§ Accounting policy
The tax expense for the period comprises current
and deferred tax. Tax is recognized in profit and
loss, except to the extent that it relates to items
recognized in other comprehensive income or
directly in equity. In this case, the tax is also
recognized in other comprehensive income or
directly in equity, respectively.
The current income tax charge is calculated based
on the tax laws enacted or substantively enacted at
the balance sheet date in the countries where the
Company and its subsidiaries operate and generate
taxable income. Management periodically evaluates
positions taken in tax returns with respect to
situations in which applicable tax regulation is
subject to interpretation. It establishes provisions,
where appropriate, based on amounts expected to
be paid to the tax authorities.
47Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
§ Accounting policy
Deferred income tax is recognized on temporary
dierences arising between the tax bases of assets
and liabilities and their carrying amounts in the
Consolidated Financial Statements. However,
deferred tax liabilities are not recognized if they arise
from the initial recognition of goodwill. Deferred
income tax is not accounted for if it arises from the
initial recognition of an asset or liability in a
transaction other than a business combination that,
at the time of the transaction, aects neither
accounting nor taxable profit or loss. Deferred
income tax is determined using tax rates (and laws)
that have been enacted or substantively enacted by
the balance sheet date and are expected to apply
when the related deferred income tax asset is
realized, or the deferred income tax liability is settled.
Deferred income tax assets are recognized only to
the extent that it is probable that future taxable profit
will be available, against which the temporary
dierences can be utilized.
Deferred income tax liabilities are provided on
taxable temporary dierences arising from invest-
ments in subsidiaries, except for deferred income tax
liability where the timing of the reversal of the
temporary dierence is controlled by the Group and
it is probable that the temporary dierence will not
reverse in the foreseeable future.
Deferred income tax assets are recognized on
deductible temporary dierences arising from
investments in subsidiaries, only to the extent that it
is probable that the temporary dierence will reverse
in the future and that there is sucient taxable profit
available, against which the temporary dierence
can be utilized.
Deferred income tax assets and liabilities are oset
when there is a legally enforceable right to oset
current tax assets against current tax liabilities and
when the deferred income tax assets and liabilities
relate to income taxes levied by the same taxation
authority on either the same taxable entity or
dierent taxable entities where there is an intention
to settle the balances on a net basis.
' DKK
Deferred tax assets
Deferred tax at January , ,
Deferred tax prior period ,
Deferred tax recognized in the income statement (,) ,
Deferred tax recognized in other comprehensive income
Reclassifications ,
Currency exchange ()
Deferred tax at December , ,
Deferred tax relates to:
Intangible assets (,)
Property, plant and equipment () ()
Current assets ,
Provisions , ,
Other liabilities () ()
, ,
Tax loss carry forwards are recognised to the extent
that they are expected to be used in the future. If the
result of expected future earnings gives a reasonable
probability that the losses will be realised in a
foreseeable future, the deferred tax assets has
been recognized.
48Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
' DKK
Deferred tax liabilities
Deferred tax at January , ,
Addition on acquisition of subsidiaries ,
Deferred tax prior period
Deferred tax recognized in the income statement (,) (,)
Deferred tax recognized in other comprehensive income
Reclassifications ,
Currency exchange () ()
Deferred tax at December , ,
Deferred tax relates to:
Intangible assets , ,
Property, plant and equipment , ,
Current assets , ()
Provisions (,)
Tax loss carry forward (,)
Other liabilities (,)
, ,
Of the deferred tax liability DKK 163.4m is expected to
be recovered after more than 12 months.
9. Distribution of Profit/Loss
' DKK
Proposed dividend for the year
Retained earnings (,) (,)
(,) (,)
49Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
10. Intangible Assets
§ Accounting policy
Goodwill
Goodwill arises on the acquisition of subsidiaries and
represents the excess of the consideration transferred
over the group’s interest in net fair value of the net
identifiable assets, liabilities, and contingent
liabilities of the acquiree.
For the purpose of impairment testing, goodwill
acquired in a business combination is allocated to
each of the CGUs, or groups of CGUs, which is
expected to benefit from the synergies of the
combination. Each unit or group of units to which the
goodwill is allocated represents the lowest level
within the entity at which the goodwill is monitored
for internal management purposes.
Goodwill impairment reviews are undertaken
annually or more frequently if events or changes in
circumstances indicate a potential impairment. The
carrying value of goodwill is compared to the
recoverable amount, which is the higher of value in
use and the fair value less costs of disposal. Any
impairment is recognized immediately as an expense
and is not subsequently reversed.
Trademarks, customer relations, technology
platform and order backlog
Separately acquired trademarks, customer relations,
technology platform and order backlog acquired at
the acquisition of subsidiaries are shown at historical
cost and fair value, respectively. Trademarks,
customer relations, technology platform and order
backlog have a finite useful life and are carried at
cost less accumulated amortization. Amortization is
calculated using the straight-line method to allocate
the cost over their estimated useful lives as follows:
• Trademarks 2-15 years
• Customer relations 6-18 years
• Technology platform 3-4 years
• Order backlog 3 years
Software
Externally acquired software is recognized as
intangible assets if the costs are expected to
generate future economic benefits. Externally
acquired software is recorded at historical cost.
Costs associated with maintaining software pro-
grammes are recognized as an expense as incurred.
Amortization is based on the straight-line method
over the expected useful lives of 5 years.
The amortization begins when the software is at a
stage where its commercial potentials can be utilized
in the manner intended by Management.
Development projects
Research expenses are recognized as an expense as they
are incurred. Development costs are recognized as
intangible assets if the costs are expected to generate
future economic benefits and the criteria below are meet.
Development costs that are directly attributable to
the design and testing of identifiable and unique
software controlled by the group are recognized as
intangible assets where the following criteria are
• it is technically feasible to complete the software
so that it will be available for use
• management intends to complete the software
and use or sell it
• there is an ability to use or sell the software
• it can be demonstrated how the software will
generate probable future economic benefits
• adequate technical, financial, and other
resources to complete the development and to use
or sell the software are available, and
• the expenditure attributable to the software
during its development can be reliably measured.
Directly attributable costs that are capitalized as
part of the software include employee costs and an
appropriate portion of relevant overheads.
Capitalized development costs are recorded as
intangible assets and amortized from the point when
the development project is at a stage where its
commercial potentials can be utilized in the manner
intended by Management.
Amortization is based on the straight-line method
over the expected useful lives of 3-5 years.
Research expenditure and development expenditure
that do not meet the criteria above are recognized as
an expense in the income statement as incurred.
Development costs previously recognized as an
expense are not recognized as an asset in a subse-
quent period.
Impairment of non-financial assets
Intangible assets that have an indefinite useful life
(goodwill) are not subject to amortization and are
tested annually for impairment, or more frequently if
events or changes in circumstances indicate that they
might be impaired. Assets that are subject to
amortization are reviewed whenever events or changes
in circumstances indicate that the carrying amount
may not be recoverable. An impairment loss is
recognized for the amount by which the asset’s
carrying amount exceeds its recoverable amount. The
recoverable amount is the higher of an asset’s fair
value less cost of disposal and value in use. For the
purposes of assessing impairment, assets are grouped
at the lowest levels for which there are largely
independent cash inflows from other assets or groups
of assets (cash-generating units). Prior impairment of
non-financial assets (other than goodwill) is reviewed
for possible reversal at each reporting date.
50Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
' DKK Goodwill Trademarks
Customer
relations Software
Software
order book
Technology
platform
Completed
development
projects
Development
projects
in progress Total
Cost:
At January ,, , , , , , , , ,,
Exchange dierences , () (,) () (,) ,
Additions during the year , , ,
Disposals (,) (,)
Reclassifications ()
As at December ,, , , , , , , , ,,
Amortization and impairment:
At January , , , , , , ,
Exchange dierences () (,) () (,) (,)
Amortization charge , , , , , , ,
Disposals (,) (,)
As at December , , , , , , ,
Carrying amount December ,, , , , , , , ,,
51Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
' DKK Goodwill Trademarks
Customer
relations Software
Software
order book
Technology
platform
Completed
development
projects
Development
projects
in progress Total
Cost:
At January , , , , , , ,
Exchange dierences , () () () ,
Addition acquisition of subsidiary , , , , , ,,
Additions during the year , , ,
Reclassifications , (,)
As at December ,, , , , , , , , ,,
Amortization and impairment:
At January , , , , ,
Exchange dierences
Amortization charge , , , , , , ,
As at December , , , , , , ,
Carrying amount December ,, , , , , , , , ,,
Research and development cost included in the income
statement amounts to DKK 45.5m (2021: DKK 14.3m).
52Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
Impairment test for goodwill
Impairment test was performed at the end of 2022.
The impairment test was based on the cash-generat-
ing-units (CGU's) to which goodwill can be allocated.
The basis for determining the recoverable amount is
value-in-use for the CGU's. Acquired companies and/
or activities are integrated into the Trackunit business
as quickly as possible in order to obtain the optimum
synergies. Consequently, soon after an acquisition, it
is no longer possible to allocate goodwill to individual
acquisitions. Trackunit as a group is evaluated to be
one cash-generating unit (Trackunit). This is also
sustained by our business model where all subsidiaries
are sales companies with access to the same software
portfolio. No special software is made for one
subsidiary alone. We act as one company.
The impairment test compares the recoverable
amount, equivalent to the present value of the
expected future cash flows, with the invested capital of
the individual CGU. The expected future cash flow is
based on budget for 2023 and business plans for
2024-2026. Budget and business plans are approved
by group management and the board of directors.
Primary variables are sales, EBIT, and investments.
The construction industry is one of the least digitalized
industries and the market for connectivity will continue
to expand for many years. Therefore expected growth
rates on revenue is high. Trackunit is expecting growth
rates between 13%-19% during the budget and
strategy period. The growth rate beyond the budget
and forecast periods (the terminal period) is consid-
ered to be 4%. All growth rates is based on manage-
ment expectation to the underlying market growth and
further supported by historic performance. Revenue
and EBIT margin is in line with the overall business plan
and forecasted in a detailed model including volume
of new subscriptions, churn, price mix, license mix and
expectations to the development in gross profit
margins. Sales expectations and EBIT margin used in
the impairment test is therefore considered reasonable
taking the initiatives in the business plan and general
market outlook into consideration. Investments are
assumed to be level with depreciations and amortiza-
tions in the terminal period. The pre-tax discount rate
used to calculate the recoverable amount is 10,9%.
Determination of fair value is considered a level 3
measurement due to application of a discount
compared to the observable multiples.
The performed impairment test did not show any need
for impairment. Therefore, impairment will not be
required. In relation to sensitivity analysis, a simulta-
neous 1,5 percentage point increase in WACC and 2
percentage point decrease in the terminal period
growth rate does not lead to an impairment charge.
Further the majority of the booked value of goodwill
can all be allocated to the acquisition made last year.
As there have been no significant changes in the
business model and profit is in line with expectations
the booked value therefore indicated the market value
at the balance date and no impairment is needed.
Impairment test for customer relations
The customer relations are amortized and tested if
there are indications of impairment. Customer
relations are amortized over 6-18 years. Customer
relations valuation is performed on the time of the
acquisition and based on a multi-period excess
earnings method (MEEM), considering the customers
present at that time. Management has analyzed
whether the main prerequisites of the MEEM calcula-
tion are still present. Further the majority of the
booked value of customer relations can be allocated
to the acquisition made last year. As there have been
no significant changes to the customer base since the
acquisition impairment will not be required.
53Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
11. Property, Plant and Equipment
§ Accounting policy
Tangible assets are mainly comprised of plant and
machinery and other equipment, which are measured
at cost less accumulated depreciation, and any
impairment losses. The cost comprises the acquisition
cost and other directly attributable expenses of
preparing the asset for its intended use.
Depreciation is calculated using the straight-line
method to allocate the cost or revalued amounts of
the assets, net of their residual values, over their
estimated useful lives as follows:
• Plant and machinery 3-7 years
• Other equipment 3 years
The assets’ residual values and useful lives are
reviewed, and adjusted if appropriate, at the end of
each reporting period.
Gains and losses on disposals are determined by
comparing the proceeds with the carrying amount.
These are included in profit or loss.
An asset is impaired to its recoverable amount if the
asset’s carrying amount is greater than its estimated
recoverable amount. The impairment loss is recognized
in profit and loss when the impairment is identified.
' DKK
Plant and
machinery
Other
equipment Total
Cost:
At January , , ,
Exchange dierences () () ()
Additions during the year , , ,
Disposals during the year (,) () (,)
As at December , , ,
Amortization and impairment:
At January , , ,
Exchange dierences () () ()
Depreciation for the year , , ,
Depreciation of disposed assets (,) () (,)
As at December , , ,
Carrying amount December , , ,
' DKK
Plant and
machinery
Other
equipment Total
Cost:
At January , , ,
Exchange dierences ()
Addition on acquisition of subsidiaries , ,
Additions during the year , ,
Disposals during the year () ()
As at December , , ,
Amortization and impairment:
At January , , ,
Exchange dierences
Depreciation for the year , ,
Depreciation of disposed assets () ()
As at December , , ,
Carrying amount December , , ,
54Consolidated Financial Statements
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12. Leases as Lessee
§ Accounting policy
The lessee is required to recognize all leases as a
lease liability and a lease asset in the balance sheet
with two exceptions: short-term leases (less than 12
months) and leases relating to low-value assets. It
must furthermore be considered whether the
agreement is a lease or a service arrangement.
The group leases various vehicles, oces, and other
equipment. From 1 January 2019, leases are
recognized as a right-of-use asset and a correspond-
ing liability at the date the leased asset is available
for use by the group. In general, all lease contracts
are recognized as a lease liability and a lease asset
in the balance sheet with two exceptions: short-term
leases (less than 12 months) and leases relating to
low-value assets (< DKK 35.000).
When determining the present value of lease assets
and lease liabilities the Group make estimations
regarding amortization period based on expected
useful lives and internal interest.
Cars
Lease contracts could be separated between a
leasing contract and a service arrangement. The
group has decided not to separate lease and
non-lease components and instead recognize each
car as one contract.
Assets and liabilities arising from a lease are initially
measured on a present value basis. To find the
present value of a lease contract several factors
must be determined. Leasing period and fixed
payments appears in the lease contract which
means only interest rate must be determined. Here
the groups incremental borrowing rate to obtain an
asset of similar value is used (3%).
Variable lease payments as extra miles beyond the
lease contract, damages, bridge tolls etc. is not
measured as a lease liability and a lease asset in the
balance sheet. Instead, these costs are recognized in
the profit and loss when they occur.
Oces
Assets and liabilities arising from a lease are initially
measured on a present value basis. To find the present
value of a lease contract several factors must be
determined. Fixed payments appear in the lease
contract. The leasing period for all oces is set the
same date as the headquarter in Aalborg oce expires
even though dierent terms of condition may occur.
The groups incremental borrowing rate to obtain an
asset of similar value of 3% have been applied.
Other equipment
Assets and liabilities arising from a lease are initially
measured on a present value basis. To find the
present value of a lease contract several factors
must be determined. Leasing period and fixed
payments appears in the lease contract which
means only interest rate must be determined. Here
the groups incremental borrowing rate to obtain an
asset of similar value is used (3%).
' DKK
Right-of-use assets
Premises , ,
Vehicles , ,
Others
, ,
Lease liabilities
Current , ,
Non-current , ,
, ,
This note provides information for leases where the
group is a lessee. The following amounts relating to
leases are recognized in the balance sheet:
Overview of the lease liabilities are included in note 20.
55Consolidated Financial Statements
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Amounts recognized in the statement of profit or loss
The following amounts relating to leases are
recognized in the statement of profit or loss:
1 This is mainly due to a new agreements on premies.
13. Inventories
§ Accounting policy
Inventories are stated at the lower of cost and net
realizable value. Cost is determined using the
first-in, first-out (FIFO) method. The cost of raw
materials and consumables comprises purchase
price and other direct costs. Finished goods are
recognized at manufacturing cost including
materials consumed and labor costs plus allowance
for production overheads including operating costs,
maintenance, and depreciation of production plant.
It excludes borrowing costs. Net realizable value is
the estimated selling price in the ordinary course of
business, less applicable variable selling expenses.
' DKK
Depreciation charge of right-of-use assets
Premises , ,
Vehicles , ,
Others
, ,
Interest expense
(included in finance cost) ,
Expense relating to short-term leases
(included in cost of goods sold and administrative expenses)
Expense relating to leases of low-value assets
that are not shown above as short-term leases
(included in administrative expenses)
Expense relating to variable lease payments
not included in lease liabilities
(included in administrative expenses)
Total cash outflow for leases , ,
Additions to right-of-use assets
,
' DKK
Raw materials and supplies , ,
Finished goods , ,
Total inventories , ,
Less: provision for inventory reserves , ,
Total net inventories , ,
Inventories recognized as an expense and included in
‘Cost of providing services’ , ,
56Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
14. Trade Receivables
§ Accounting policy
Receivables are measured at amortized cost.
Receivables are written down for expected credit
losses based on the simplified approach to
providing for expected credit losses, which requires
expected lifetime losses to be recognized from initial
recognition of receivables. Impairment losses are
calculated as the dierence between carrying
amount and present value of expected cash flows,
including the expected realizable value of any
collateral provided. The discount rate is the eective
interest rate used at the time of initial recognition of
the receivable.
' DKK Current
-
days
past due
-
days
past due
-
days
past due
More than
days
past due Total
December
Gross carrying amount , , , , , ,
Loss allowance () () () () (,) (,)
Trade receivables , , , , , ,
Expected loss rate % % % % % %
December
Gross carrying amount , , , , , ,
Loss allowance () () () () (,) (,)
Trade receivables , , , , , ,
Expected loss rate % % % % % %
' DKK
Movement on the Group provision for impairment of trade
receivables are as follows:
Opening balances , ,
Change in provision ,
Write-os during the year () ()
At December , ,
According to IFRS 9 a provision matrix for the group is
applied. The provision matrix is based on historical loss
rate and management’s expectations to future losses.
The historical loss rate is calculated based on the 2021
data. The matrix provision is applied after adjusting for
any specific provisions and is based on the Groups
expectations to the industry in which it operates.
57Consolidated Financial Statements
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15. Financial Assets and Liabilities
§ Accounting policy
Financial assets
Classification
The group classifies its financial assets in the following
measurement category; those to be measured at
amortized cost. The classification depends on the
purpose for which the financial assets were acquired.
Management determines the classification of its
financial assets at initial recognition.
Amortized cost
The group classifies its financial assets as at
amortized cost only if both of the following criteria
are met:
• the assets are held within a business model
whose objective is to collect the contractual cash
flows, and
• the contractual terms give rise to cash flows that
are solely payments of principal and interest.
Recognition and Measurement
Regular purchases and sales of financial assets are
recognized on the trade date - the date on which the
Group commits to purchase or sell the asset.
Investments are initially recognized at fair value,
plus transaction costs for all financial assets not
carried at fair value through profit or loss. Financial
assets are derecognized when the rights to receive
cash flows from the investments have expired
or have been transferred and the Group has
transferred substantially all risks and rewards
of ownership.
Financial liabilities and equity instruments
Classification
Debt and equity instruments issued by a group
entity are classified as either financial liabilities or
as equity in accordance with the substance of the
contractual arrangements and the definitions of a
financial liability and an equity instrument.
Financial liabilities
Financial liabilities are initially measured at fair
value less transaction costs incurred. Subsequently,
the loans are measured at amortized cost. Amortized
cost is calculated as original cost less installments
plus/less the accumulated amortization of the
dierence between cost and nominal value. Losses
and gains on loans are thus allocated over the term
so that the eective interest rate is recognized in the
income statement over the loan period. Financial
liabilities are derecognized when settled.
Deferred revenue
Deferred revenue are prepayments received from
customers, comprising of payments received
regarding income in subsequent years.
' DKK
Financial assets at amortised cost:
Trade receivables , ,
Receivables from group enterprises , ,
Connected devices , ,
Other financial assets at amortised costs , ,
Cash and cash equivalents , ,
Other current assets , ,
Total , ,
Financial liabilities at amortised cost:
Lease liabilities , ,
Trade and other payables , ,
Payables to group enterprises , ,
Financial liabilities at fair value:
Derivative financial instruments:
Fair value through other comprehensive income
Total , ,
Fair values are approximately the same as the carrying amounts.
58Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
16. Share Capital 17. Related Parties 18. Commitments and
Contingent Liabilities
§ Accounting policy
Equity instruments
An equity instrument is any contract that
evidences a residual interest in the assets of an
entity after deducting all its liabilities. Equity
instruments issued by a group entity are
recognized at the proceeds received, net of direct
issue costs.
Other reserves include:
• Foreign currency translation – movements in
other comprehensive income from retranslation
of foreign operations.
• Other undistributable reserve – movement in
share warrants
• Reserve for hedging – movements in other
comprehensive income from fair value
adjustments of cash flow hedging
Subject to customary legal provisions, the Group and
subsidiaries act as guarantors of loans for the Group
entity Galaxy Bidco ApS.
The Danish companies are jointly and severally liable
for tax on the Group's jointly taxed income. The jointly
taxed amount is stated in the financial statement of the
management company for the joint taxation, Galaxy
Holdco ApS. The Group's Danish companies are also
jointly and severally liable for withholding taxes, royalty
taxes and interest taxes. Any subsequent adjustments
to corporation and withholding taxes may result in the
company's liability amounting to a larger amount.
Dividends
The dividends paid in 2022 were DKK 0 (2021: DKK 0).
Capital management
Capital management
The group’s objectives when managing capital are to
safeguard the group’s ability to continue as a going
concern in order to provide returns for shareholders
and benefits for other stakeholders and to maintain an
optimal capital structure to reduce cost of capital.
The management and the owners monitor the share
and capital structure to ensure that Trackunit ApS’
capital resources support the strategic goals.
Consistent with others in the industry, the group
monitors capital based on the gearing ratio. This ratio is
calculated as net debt divided by total capital. Net debt
is calculated as total borrowings (including ‘current
and non-current borrowings’ as shown in the consoli-
dated balance sheet) less cash and cash equivalents.
Total capital is calculated as ‘equity’ as shown in the
consolidated balance sheet plus net debt.
During 2022, the Group's strategy was to maintain the
gearing ratio below 10%. The gearing ratio at 31
December 2022 was 0.1% (2021: -5.4%).
The group is owned by Galaxy Bidco ApS, who owns
100% of the shares.
Galaxy UK Topco Limited is the ultimate owner in the
Group. Galaxy UK Topco Limited is mainly owned by
Hg Genesis 9 Nominess Limited. The directors of Hg
Genesis 9 Nominess Limited deem there not to be an
ultimate controlling party as none of the limited
partners in the limited partnerships managed by Hg
Pooled Management Limited has an ownership of more
than 20% of the issued share capital of the company.
Trackunit ApS Group is included in the consolidated
annual report for Galaxy Holdco ApS and the consoli-
dated annual report for Galaxy UK Topco Limited.
Transactions with parent companies have been
management fee, financing, and interest.
Trackunit’s interests in subsidiaries are shown in note
23, Group companies. No transactions were carried
out during the year with subsidiaries with the
exception of intra-group transactions eliminated in
the consolidated financial statements.
The disclosure of “Key management compensation”
is presented in note 3. No other transactions where
carried out during the year with Key management.
The disclosure of shares issued during the period is
presented in note 16.
Transactions with related parties have all been on
arm's length.
The Group has no hedging instruments at
31 December 2022.
The share capital comprises 500,000 shares
of a nominal value of DKK 1 each.
All shares are fully issued and paid. One share
holds one vote.
59Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
19. Business Combinations
§ Accounting policy
The acquisition method of accounting is used to
account for all business combinations, regardless of
whether equity instruments or other assets are
acquired. The consideration transferred for the
acquisition of a subsidiary comprises the:
• fair values of the assets transferred
• liabilities incurred to the former owners
of the acquired business
• equity interests issued by the group
• fair value of any asset or liability resulting from
a contingent consideration arrangement, and
• fair value of any pre-existing equity interest
in the subsidiary.
Identifiable assets acquired and liabilities and
contingent liabilities assumed in a business combina-
tion are, with limited exceptions, measured initially at
their fair values at the acquisition date. The group
recognizes any non-controlling interest in the
acquired entity on an acquisition-by-acquisition
basis either at fair value or at the non-controlling
interest’s proportionate share of the acquired entity’s
net identifiable assets.
Acquisition-related costs are expensed as incurred.
The excess of the
• consideration transferred,
• amount of any non-controlling interest in the
acquired entity, and
• acquisition-date fair value of any previous equity
interest in the acquired entity
over the fair value of the net identifiable assets
acquired is recorded as goodwill. If those amounts are
less than the fair value of the net identifiable assets of
the business acquired, the dierence is recognized
directly in profit or loss as a bargain purchase.
Where settlement of any part of cash consideration
is deferred, the amounts payable in the future are
discounted to their present value as at the date of
exchange. The discount rate used is the entity’s
incremental borrowing rate, being the rate at which
a similar borrowing could be obtained from an
independent financier under comparable terms and
conditions.
Contingent consideration is classified either as
equity or a financial liability. Amounts classified as a
financial liability are subsequently remeasured to
fair value with changes in fair value recognized in
profit or loss.
If the business combination is achieved in stages, the
acquisition date carrying value of the acquirer’s
previously held equity interest in the acquiree is
remeasured to fair value at the acquisition date. Any
gains or losses arising from such remeasurement are
recognized in profit or loss.
Acquisition in 2022
There have been no acquisitions in 2022.
Acquisition in 2021
In November 2021, the group acquired the Industrial
IOT division from within ZTR Control Systems, LLC, ZTR
Holdings LLC and Trac Rail Inc. As a result of the
acquisition, the group has increased its presence in
the marketplace regarding machine connectivity.
Overview of the fair value of the assets and liabilities
acquired is shown in the Financial Statement for 2021.
60Consolidated Financial Statements
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Financial risk factors
The group’s activities expose it to a variety of financial
risks: market risk (currency and interest risk), credit risk
and liquidity risk. The group’s overall risk management
program focuses on the unpredictability of financial
markets and seeks to minimize potential adverse eects
on the group’s financial performance.
The Financial risks of the group are managed centrally.
The overall risk management guidelines and policies
have been approved by the board of directors. The
board provides principles for overall risk management,
as well as policies covering specific areas, such as
foreign exchange risk, interest rate risk, credit risk, use of
derivative financial instruments and non-derivative
financial instruments, and investment of excess liquidity.
Market risk
Foreign exchange risk
The group operates internationally and is exposed to
foreign exchange risk arising from various currency
exposures. Foreign exchange risk arises from future
commercial transactions, recognized assets and
liabilities and net investments in foreign operations.
Increases or decreases in the exchange rate of such
foreign currencies against the functional currency, the
DKK, can aect the group’s results and cash position
negatively or positively.
Management has set up a policy to require group
companies to manage their foreign exchange risk
20. Financial Risk Management
against their functional currency. Foreign exchange risk
arises when future commercial transactions or
recognized assets or liabilities are denominated in a
currency that is not the entity’s functional currency.
The Groups sales, cost of goods sold, and expenses are
mainly incurred in DKK, EUR, USD, CAD, or GBP. The
Group has transactions in other currencies, but the
foreign exchange risks related to this are not considered
material. The group's debt is denominated in EUR, GBP,
and USD. All loan facilities is placed on a higher level in
the Group.
The group is primarily exposed to changes in DKK/GBP,
DKK/USD and DKK/CAD exchange rate.
Sensitivity analysis – foreign exchange risk
The following table details the group's sensitivity to a
10% decrease in USD, GBP and CAD exchange rates.
The analysis includes impact to the profit and loss and
total equity by translating the profit and loss accounts
and balance sheet with USD, GBP and CAD exchange
rates 10% lower than actual balance sheet ending
rates. All other variables are held constant.
' DKK
Net Profit
Equity
Net Profit
Equity
USD (,) (,) () (,)
GBP , ()
CAD (,) (,) , (,)
Interest rate risk
The Groups interest rate risk arises from long-term
borrowings related to acquisition facilities. Borrowings
issued at variable rates expose the group to cash flow
interest rate risk. A group hedging policy, to mitigate
the interest risk, is being developed.
Sensitivity analysis – interest rate risk
Based on the termination dates, repayments, and
interest rates of the individual loan agreements the
impact of a 1% increase in the interest rates is calculat-
ed. The following table details the group's sensitivity to
a 1 percentage point increase in interest rate level.
The analysis includes impact to the profit and loss and
total equity. All other variables are held constant. Tax
consequences are not included in the analysis.
The stated sensitivities are based on the recognized
financial assets and liabilities throughout each quarter
of the year. Adjustments are made for installments,
borrowings, etc.
All Senior Loan facilities were settled in connection with
the acquisition by Hg, and the new loan facilities have
been placed at a higher level in the Group. Therefore,
the sensitivity analysis in 2022 and 2021 is zero.
61Consolidated Financial Statements
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Credit risks
Credit risk is managed on group basis. Standard terms
and conditions apply for the Group and changes are
subject to central approval.
Credit risk arises from cash and cash equivalents and
deposits with banks and financial institutions, as well as
credit exposures to customers, including outstanding
receivables. For banks and financial institutions, only
independently rated parties with a minimum rating of ‘A’
are accepted. For customers individual risk limits are set
based on internal or external ratings.
The maximum exposure corresponds to the carrying
amount.
Liquidity risk
Cash flow forecasting is performed by group finance.
Group finance monitors rolling forecasts of the group’s
liquidity requirements to ensure it has sucient cash to
meet operational needs while always maintaining
sucient headroom on its undrawn committed
borrowing facilities so that the group does not breach
borrowing limits or covenants (where applicable) or any
of its borrowing facilities. Such forecasting takes into
consideration the group’s debt financing plans,
covenant compliance and compliance with internal
balance sheet ratio targets.
The group has unutilized borrowing facilities of DKK
100m that may be available for future operating
activities, as well as other incremental loan facilities.
Further the long-term debt to credit institutions and
other long-term debt is all a without repayment until exit
(changes in ownership). It is expected that the future
profit will generate the needed cash for repayment of
loans and other cash flow requirements.
Financial covenants
The company is measured on a quarterly basis on a
Leverage covenant against the Facility agreement with
the Group’s bank. The company has complied with
those covenants during 2022.
The table below analyses the group’s non-derivative
and derivative financial liabilities into relevant maturity
groupings based on the remaining period at the
balance sheet date to the contractual maturity date.
The amounts disclosed in the table are the contractual
undiscounted cash flows.
' DKK
Less than
year
to
years
More than
years Total
December
Lease liabilities , , ,
Trade and other payables , ,
, , ,
December
Lease liabilities , , ,
Trade and other payables , ,
, , ,
62Consolidated Financial Statements
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On January 1 2023 Trackunit acquired the German
Con-Tech company Flexcavo GmbH. Flexcavo oers a
unique software solution to the contractor segment
which therefore provides a perfect fit for the Trackunit
product suite. The acquisition has no eect on the
2022 financials.
21. Events After the Balance Sheet Date
22. Changes in Net Working Capital
' DKK
Changes in inventories (,) (,)
Changes in trade receivables and other receivables (,) (,)
Changes in trade and other payables , ,
, ,
23. Group Companies
Name and registered oce Country Direct Group holding (pct.)
Trackunit Pty Ltd Australia %
Trackunit KK Japan %
Trackunit Asia Pacific Pte Ltd Singapore %
Trackunit AB Sweden %
Trackunit AS Norway %
Trackunit America ApS Denmark %
– Trackunit Inc USA %
– Trackunit Canada Inc Canada %
Trackunit SAS France %
Trackunit Ltd United Kingdom %
– Fern Capital Ltd United Kingdom %
· Trackunit Telematics Ltd United Kingdom %
Trackunit GmbH Germany %
Trackunit BV Netherlands %
No other subsequent events have occurred after the
balance sheet date that required adjustment to or
disclosure in the consolidated financial statements.
63Consolidated Financial Statements
The Big Picture We Are Trackunit ESG Financial Review Parent Company Financial Statements Statements
This note provides a list of the significant accounting
policies adopted in the preparation of these consolidat-
ed financial statements to the extent they have not
already been disclosed in the other notes. These
policies have been consistently applied throughout the
financial year presented, unless otherwise stated.
During the financial year Trackunit ApS merged with the
companies M-tec Danmark ApS and M-tec Holding
Danmark ApS with retrospective eect for accounting
purposes at 1 January 2022 and as the continuing
company. As a result, the comparative figures are
restated in accordance with the adjusted pooling-of-in-
terests method. The eect of the merger for the parent
company in 2021 is a change in profit for the year of
DKK -22.3m, the equity of DKK 306.8m and total assets
of DKK 373.5m.
General
The Consolidated Financial Statements for Trackunit
ApS have been prepared in accordance with Interna-
tional Financial Reporting Standards (IFRS) as issued
by the International Accounting Standards Board (IASB)
and as adopted by the European Union as well as
additional Danish disclosure requirements applying to
entities of reporting class C.
24. Basis of Preparation
The annual report is prepared according to standards
and interpretations eective for financial years
beginning on 1 January 2022. No standards or
interpretations other than those mentioned below have
been adopted early.
General information on recognition
and measurement
The Financial Statements have been prepared under
the historical cost method, except for the measurement
of certain financial instruments at fair value.
Implementation of new standards, amendments,
and interpretations
The group has applied the following amendments
for the first time for their annual reporting period
commencing 1 January 2022:
• Property, Plant and Equipment: Proceeds before
Intended Use – Amendments to IAS 16
• Onerous Contracts – Cost of Fulfilling a Contract –
Amendments to IAS 37
• Annual Improvements to IFRS Standards 2018-2020,
and
• Reference to the Conceptual Framework
– Amendments to IFRS 3
The group also elected to adopt the following
amendments early:
• Deferred Tax related to Assets and Liabilities arising
from a Single Transaction – amendments to IAS 12 13,
and
• Disclosure of Accounting Policies – Amendments to
IAS 1 and IFRS Practice Statement 2.
The amendments listed above did not have any impact
on the amounts recognized in prior periods and are
not expected to significantly aect the current or
future periods.
New standards, amendments and interpretations
adopted but not yet eective
Certain new accounting standards and interpretations
have been published that are not mandatory for 31
December 2022 reporting periods and have not been
early adopted by the group. These standards are not
expected to have a material impact on the entity in the
current or future reporting periods and on foreseeable
future transactions.
Basis of consolidation
Subsidiaries
Subsidiaries are all entities over which the group has
control. The group controls an entity when the group is
exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to aect
those returns through its power over the entity.
Subsidiaries are fully consolidated from the date on
which control is transferred to the group. They are
deconsolidated from the date that control ceases.
Inter-company transactions, balances, and unrealized
gains on transactions between group companies are
eliminated. Unrealized losses are also eliminated unless
the transaction provides evidence of an impairment of
the transferred asset. Accounting policies of subsidiar-
ies have been changed where necessary to ensure
consistency with the policies adopted by the group.
Foreign currency translation
Functional and presentation currency
Items in the financial statements of each of the
reporting companies of the Group are measured in the
currency of the primary economic environment in which
the company operates (the functional currency).
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The financial statements are presented in Danish Kroner
(DKK), which is Trackunit ApS’ functional and presenta-
tion currency. The financial statements have been
rounded to the nearest thousand.
Transactions and balances
Foreign currency transactions are translated into the
functional currency using the exchange rates at the
dates of the transactions or valuation where items are
re-measured. Foreign exchange gains and losses
resulting from the settlement of such transactions and
from the translation at year-end exchange rates of
monetary assets and liabilities denominated in foreign
currencies are recognized in profit and loss, except
when deferred in other comprehensive income as
qualifying cash flow hedges and qualifying net
investment hedges. Foreign exchange gains and losses
are presented in the income statement within “finance
income or costs”.
Group companies
The results and financial position of all the group
entities that have a functional currency dierent from
the presentation currency are translated into the
presentation currency as follows:
• Assets and liabilities for each balance sheet
presented are translated at the closing rate at the
date of that balance sheet.
• Income and expenses for each statement of profit
and loss are translated at average exchange rates;
and
• All resulting exchange dierences are recognized in
other comprehensive income.
Goodwill and fair value adjustments arising on the
acquisition of a foreign entity are treated as assets and
liabilities of the foreign entity and translated at the clos-
ing rate. Exchange dierences arising are recognized in
other comprehensive income.
Statement of cash flow
The Statement of Cash Flows is presented using the
indirect method. The Statement of Cash Flows shows
cash flows used in operating activities, cash flows used
in investing activities, cash flows from financing
activities, and the group's cash and cash equivalents at
the beginning and end of the year.
Cash flows used in operating activities is comprised of
net profit or loss for the year adjusted for non-cash
items, such as share based payment expense, fair value
revaluations of shareholder warrants, depreciations,
paid financial items, corporate tax paid, and change in
working capital. Cash flows used in investing activities
is comprised of payments relating to property, plant,
and equipment.
Cash flows from financing activities is comprised of
proceeds from borrowings, such as interest-bearing
convertible loans, and proceeds from share issuances
and related transaction costs.
Cash and cash equivalents
In the consolidated statement of cash flows, cash
and cash equivalents includes cash in hand and other
short-term highly liquid investments with original
maturities of three months or less.
65Consolidated Financial Statements
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Parent Statement of Profit and Loss
1 January – 31 December
' DKK Notes
Gross profit/(loss) , ,
Sta expenses (,) (,)
Profit/loss before depreciations , ,
Depreciation, amortization and impairment of intangible assets
and property, plant and equipment (,) (,)
Other operating expenses (,) (,)
Profit/loss before depreciations , ,
Income from investments in subsidiaries (,) (,)
Finance income , ,
Finance costs (,) (,)
Profit/loss before tax , (,)
Income tax expense (,) (,)
Profit/(loss) for the year , (,)
67Parent Company Financial Statements
The Big Picture We Are Trackunit Consolidated Financial Statements Statements ESG Financial Review
' DKK Notes
Completed development projects , ,
Acquired licenses ,
Goodwill , ,
Trademarks , ,
Customer relations , ,
Development projects in progress , ,
Intangible assets , ,
Land and buildings , ,
Other fixtures and fittings, tools and equipment , ,
Leasehold improvements ,
Property, plant and equipment , ,
Investments in subsidaries ,, ,,
Deposits , ,
Fixed assets investments ,, ,,
Total non-current assets ,, ,,
' DKK Notes
Inventories , ,
Trade receivables , ,
Receivables from group enterprises , ,
Connected device costs , ,
Other receivables , ,
Prepayments , ,
Receivables , ,
Cash and cash equivalents , ,
Total current assets , ,
Total assets ,, ,,
Parent Balance Sheet – 31 December
Assets
68Parent Company Financial Statements
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Parent Balance Sheet – 31 December
Equity and Liabilities
' DKK Notes
Share capital
Reserve for net revaluation under the equity method (,) (,)
Reserve for development costs , ,
Reserve for hedging transactions
Retained earnings ,, ,,
Proposed dividend for the year
Total equity ,, ,,
Provision for deferred tax , ,
Provision relating to investments in group enterprises
Provision , ,
Lease obligations , ,
Deferred income , , ,
Total non-current liabilities , ,
' DKK Notes
Lease obligations , ,
Trade payables , ,
Payables to group enterprises , ,
Corporation tax payables to group enterprises , ,
Other payables , ,
Deferred income , , ,
Total current liabilities , ,
Total liabilities , ,
Total equity and liabilities ,, ,,
Share-based payment
Contingent assets, liabilities and financial obligations
Events after the balance sheet date
Related parties
Significant accounting policies
69Parent Company Financial Statements
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' DKK
Share
capital
Reserve for net
revaluation under
the equity method
Reserve for
development
costs
Reserve for
hedging
transactions
Retained
earnings
Proposed
dividend for
the year
Total
equity
Balance at January (,) , ,, ,,
Exchange adjustment relating to foreign entities (,) (,)
Development costs for the year , (,)
Amortization for the year (,) ,
Net profit/loss for the year (,) , ,
Other equity movements
Balance at December (,) , ,, ,,
Balance at January , , () , , ,
Net eect from merger and acquisition under
the pooling-of-interests method , (,) ,
Increase in share capital ,, ,,
Exchange adjustment relating to foreign entities , ,
Development cost for the year , (,)
Amortization for the year (,) ,
Net profit/loss for the year (,) , (,)
Other equity movements
Balance at December (,) , ,, ,,
Parent Statement of Changes in Equity
January 1 – December 31
70Parent Company Financial Statements
The Big Picture We Are Trackunit Consolidated Financial Statements Statements ESG Financial Review
72 Note 1 Sta Costs
72
Note 2
Share-based payment
73 Note 3 Depreciation, Amortization and Impairment of Intangible
Assets and Property, Plant and Equipment
73 Note 4 Other Operating Expenses
73 Note 5 Financial Income and Expenses
74 Note 6 Tax on Profit/Loss for the Year
74 Note 7 Intangible Assets
75 Note 8 Property, Plant and Equipment
75 Note 9 Investments in Subsidiaries
76 Note 10 Other Fixed Investments
76 Note 11 Inventories
77 Note 12 Prepayments
77 Note 13 Share Capital
77 Note 14 Distribution of Profit/Loss
77 Note 15 Provision for Deferred Tax
78 Note 16 Long-Term Debt
78 Note 17 Deferred Revenue
78 Note 18 Contingent Assets, Liabilities, and Financial Obligations
78 Note 19 Events After the Balance Sheet Date
78 Note 20 Related Parties
79 Note 21 Significant Accounting Policies
Index of
Parent Notes
71Parent Company Financial Statements
The Big Picture We Are Trackunit Consolidated Financial Statements Statements ESG Financial Review
1. Sta Costs
' DKK
Wages and salaries , ,
Pensions , ,
Other social security costs ,
Other employee costs , ,
Total sta cost , ,
Including remuneration to the Executive Management and Board of Directors of:
Executive Management , ,
Board of Directors
, ,
Average number of full time employees
2. Share-based payment
Outstanding warrants January
Granted during the year ,
Forefeited during the year
Outstanding warrants December ,
To attract and retain employees Trackunit has
established an incentive program for all employees
in 2022. The purpose is to share the value creation
eventually to be realized at the time of an exit with
employees and support retention until then.
The warrant program is an equity settled programme
established in March 2022. The vesting period is
expected to be 4 years starting from the grant date.
The programme comprises a total of 777,000 warrants
at 31 December 2022 (2021: 0). Each warrant gives the
holder right to share capital of DKK 0.01 nominal value
in the ultimative parent company Galaxy UK Topco Ltd.
The total number of warrants granted in 2022
was 777,000. The total fair value of the progamme
is DKK 3.0m.
The valuation is based on the following assumptions:
• Vesting period: 4 years
• Expected volatility: 44% - based on
peer group analysis
• Risk free interest rate: 2,7%
Total expenses arising from the incentive programme
is DKK 3.0m and is recognized as sta cost.
72Parent Company Financial Statements
The Big Picture We Are Trackunit Consolidated Financial Statements Statements ESG Financial Review
4. Other Operating Expenses
' DKK
M&A activities , ,
Restructuring ,
Consultancy ,
Other expenses
, ,
5. Financial Income and Expenses
' DKK
Financial income
Exchange rate adjustments , ,
Interest received from Group enterprises , ,
Other financial income
, ,
Financial cost
Interest expenses, bank debt ,
Interest and finance charges for lease liabilities
Loan fee amortizations ,
Interest paid from Group enterprises , ,
Other financial expenses, including bank fees
, ,
3. Depreciation, Amortization and Impairment of Intangible
Assets and Property, Plant and Equipment
' DKK
Amortization of intangible assets , ,
Depreciation of property, plant and equipment , ,
, ,
73Parent Company Financial Statements
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6. Tax on Profit/Loss
for the Year
' DKK
Current tax for the year , ,
Current tax on profits
for prior years
Deferred tax for the year (,) (,)
, ,
' DKK Goodwill Trademarks
Customer
relations Software
Completed
development
projects
Development
projects in
progress Total
Cost:
At January , , , , , , ,
Addition during the year , , ,
Disposals (,) (,)
Reclassifications ()
As at December , , , , , , ,
Amortization and impairment:
At January , , , , , ,
Disposals (,) (,)
Amortisation charge , , , , , ,
As at December , , , , , ,
Carrying amount December , , , , , ,
7. Intangible Assets
Completed development projects relate to develop-
ment of products and services that are ready for sale.
74Parent Company Financial Statements
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' DKK
Land and
buildings
Other fixtures
and fittings, tools
and equipment
Leasehold
improvements
Cost:
At January , , ,
Additions during the year , , ,
Disposals during the year (,) ()
As at December , , ,
Amortization and impairment:
At January , , ,
Depreciation for the year , ,
Depreciation of disposed assets (,) ()
As at December , , ,
Carrying amount December , , ,
Including assets under finance
leases amounting to , ,
8. Property, Plant and Equipment 9. Investments in Subsidiaries
' DKK
Cost at January ,, ,
Exchange adjustment ,
Additions for the year ,,
Cost af December ,, ,,
Value adjustments at January (,) ,
Exchange adjustments (,)
Dividend received (,)
Net profit/loss for the year (,) (,)
Value adjustments at December (,) (,)
Equity investments with negative net asset value amortized over receivables , ,
Equity investments with negative net asset vaule transferred to provision
Carrying amount at December ,, ,,
75Parent Company Financial Statements
The Big Picture We Are Trackunit Consolidated Financial Statements Statements ESG Financial Review
Name and registered
oce Country
Direct Group
holding (pct.)
Trackunit Pty Ltd Australia %
Trackunit KK Japan %
Trackunit Asia Pacific Pte Ltd Singapore %
Trackunit AB Sweden %
Trackunit AS Norway %
Trackunit America ApS Denmark %
– Trackunit Inc USA %
– Trackunit Canada Inc Canada %
Trackunit SAS France %
Trackunit Ltd United Kingdom %
– Fern Capital Ltd United Kingdom %
· Trackunit Telematics Ltd United Kingdom %
Trackunit GmbH Germany %
Trackunit BV Netherlands %
Investment in subsidiaries are specified as follows:
' DKK
Cost at January , ,
Additions for the year
Disposals for the year ()
Cost af December , ,
Carrying amount at December , ,
' DKK
Raw materials and consumables , ,
Finished goods and goods for resale , ,
, ,
10. Other Fixed Investments
11. Inventories
76Parent Company Financial Statements
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' DKK
Transfer to/from reserves in accordance with the Articles of Association (,) (,)
Retained earnings , ,
, (,)
' DKK
Provision for deered tax at January , ,
Amounts recognized in the income statement for the year (,) (,)
Amounts recognized prior year
Provision for deferred tax at December , ,
14. Distribution of Profit/Loss
15. Provision for Deferred Tax13. Share Capital
The share capital consists of 500,000 shares
of a nominal value of DKK 1. No shares carry
any special rights.
12. Prepayments
Prepayments amounts to DKK 44.4m for 2022
(2021: DKK 10.6m) and consist of prepaid
expenses concerning rent, insurance premiums
and subscriptions.
77Parent Company Financial Statements
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17. Deferred Revenue
18. Contingent Assets,
Liabilities, and Financial
Obligations
20. Related Parties
19. Events After
the Balance Sheet Date
Deferred revenue consists of payments received in respect
of income subsequent years. The total deferred revenue
amounts to DKK 189.3m in 2022 (2021: DKK 157.0m).
The Danish group companies are jointly and severally
liable for tax on the Danish jointly taxed incomes etc. of
the Danish Group. The total amount of corporation tax
payable is disclosed in the Annual Report of Galaxy
Holdco ApS, which is the administration company of the
jointly taxation purpose. Moreover, the Danish group
companies are jointly and severally liable for Danish
withholding taxes by way of dividend tax, tax on royalty
payments and tax on unearned income. Any subse-
quent adjustments of corporation taxes and withhold-
ing taxes may increase the Company’s liability.
Transactions with related parties have been on
arm's-length.
Refer to the consolidated financial statement
regarding the company's ownership structure.
On January 1 2023 Trackunit acquired the German
Con-Tech company Flexcavo GmbH. Flexcavo
oers a unique software solution to the contractor
segment which therefore provides a perfect fit for
the Trackunit product suite. The acquisition has no
eect on the 2022 financials.
No other subsequent events have occurred after
the balance sheet date that required adjustment to
or disclosure in the financial statements.
16. Long-term Debt
' DKK
Less than
year
to
years
More than
years Total
December
Lease obligations , , ,
Other payables , ,
Deferred income , , ,
, , ,
December
Lease obligations , , ,
Other payables , ,
Deferred income , , ,
, , ,
Payments due within 1 year are recognized in short-term
debt. Other debt is recognized in long-term debt.
The debt falls due for payment as specified below:
78Parent Company Financial Statements
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The Annual Report of Trackunit ApS for 2022 has
been prepared in accordance with the provisions
of the Danish Financial Statements Act applying to
reporting class C.
Recognition and measurement of financial instru-
ments are made in accordance with International
Financial Reporting Standards (IFRS), cf. the Danish
Financial Statements Act, §37 section 5.
Additionally revenue is measured in accordance with
International Financial Reporting Standards (IFRS
15), and leasing is measured in accordance Interna-
tional Financial Reporting Standards (IFRS 16).
The accounting policies are unchanged compared
with last year.
The Financial Statements for 2022 are presented
in thousand DKK.
During the financial year Trackunit ApS merged with
the companies M-tec Danmark ApS and M-tec
Holding Danmark ApS with retrospective eect for
accounting purposes at 1 January 2022 and as the
continuing company. As a result, the comparative
figures are restated in accordance with the adjusted
pooling-of-interests method. The eect of the merger
for the parent company in 2021 is a change in profit
for the year of DKK -22.3m, the equity of DKK 306.8m
and total assets of DKK 373.5m.
Cash flow statement
With reference to section 86(4) of the Danish
Financial Statements Act and to the cash flow
statement included in the consolidated financial
statements of Trackunit ApS, the Company has not
prepared a cash flow statement.
Recognition and measurement
Revenues are recognized in the income statement as
earned. Furthermore, value adjustments of financial
assets and liabilities measured at fair value or
amortized cost are recognized. Moreover, all expenses
incurred to achieve the earnings for the year are
recognized in the income statement, including
depreciation, amortization, impairment losses and
provisions as well as reversals due to changed
accounting estimates of amounts that have previous-
ly been recognized in the income statement.
Assets are recognized in the balance sheet when it is
probable that future economic benefits attributable
to the asset will flow to the Company, and the value
of the asset can be measured reliably.
Liabilities are recognized in the balance sheet when it
is probable that future economic benefits will flow
out of the Company, and the value of the liability can
be measured reliably.
Assets and liabilities are initially measured at cost.
Subsequently, assets and liabilities are measured as
described for each item below.
Leases as lessor
The lessee is required to recognize all leases as a
lease liability and a lease asset in the balance sheet
with two exceptions: short-term leases (less than 12
months) and leases relating to low-value assets. It
must furthermore be considered whether the
agreement is a lease or a service arrangement.
The company leases various vehicles, oces, and
other equipment. From 1 January 2019, leases are
recognized as a right-of-use asset and a correspond-
ing liability at the date the leased asset is available
for use by the group. In general, all lease contracts
are recognized as a lease liability and a lease asset
in the balance sheet with two exceptions: short-term
leases (less than 12 months) and leases relating to
low-value assets (< USD 5.000).
Cars
Lease contracts could be separated between a
leasing contract and a service arrangement. The
group has decided not to separate lease and
non-lease components and instead recognize each
car as one contract according to IFRS 16.15.
Assets and liabilities arising from a lease are initially
measured on a present value basis. To find the
present value of a lease contract several factors must
be determined. Leasing period and fixed payments
appears in the lease contract which means only
interest rate has to be determined. Here the groups
incremental borrowing rate to obtain an asset of
similar value is used. In accordance with the Senior
facilities agreement the interest rate for cars is 3%.
Variable lease payments as extra miles beyond the
lease contract, damages, bridge tolls etc. is not
measures as a lease liability and a lease asset in the
balance sheet. Instead, these costs are recognized in
the profit and loss when they occur.
Oces
Assets and liabilities arising from a lease are initially
measured on a present value basis. To find the
present value of a lease contract several factors must
be determined. Fixed payments appear in the lease
contract. The leasing period for all oces is set the
same date as the HQ oce expires even though
dierent terms of condition may occur. To find the
groups incremental borrowing rate to obtain an asset
of similar value, the interest rate is set to 3% for
21. Significant Accounting Policies
79Parent Company Financial Statements
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Oces in accordance with the Senior facilities
agreement.
Other equipment
Assets and liabilities arising from a lease are initially
measured on a present value basis. To find the
present value of a lease contract several factors must
be determined. Leasing period and fixed payments
appears in the lease contract which means only
interest rate has to be determined. Here the groups
incremental borrowing rate to obtain an asset of
similar value is used. In accordance with the Senior
facilities agreement the interest rate for other
equipment is 3%.
Translation policies
Transactions in foreign currencies are translated at
the exchange rates at the dates of transaction. Gains
and losses arising due to dierences between the
transaction date rates and the rates at the dates of
payment are recognized in financial income and
expenses in the income statement.
Receivables, payables, and other monetary items in
foreign currencies that have not been settled at the
balance sheet date are translated at the exchange
rates at the balance sheet date. Any dierences
between the exchange rates at the balance sheet
date and the transaction date rates are recognized in
financial income and expenses in the income
statement; however, see the section on hedge
accounting.
Income statements of foreign subsidiaries that are
separate legal entities are translated at transaction
date rates or approximated average exchange rates.
Balance sheet items are translated at the exchange
rates at the balance sheet date. Exchange adjust-
ments arising on the translation of the opening
equity and exchange adjustments arising from the
translation of the income statements at the exchange
rates at the balance sheet date are recognized
directly in equity.
Derivative financial instruments
Derivative financial instruments are initially recog-
nized in the balance sheet at cost and are subse-
quently remeasured at their fair values. Positive and
negative fair values of derivative financial instru-
ments are classified as “Other receivables” and
“Other payables”, respectively.
Changes in the fair values of derivative financial
instruments are recognized in the income statement
unless the derivative financial instrument is designat-
ed and qualify as hedge accounting (See below).
Hedge accounting
Changes in the fair values of financial instruments
that are designated and qualify as fair value hedges
of a recognized asset, or a recognized liability are
recognized in the income statement as are any
changes in the fair value of the hedged asset or the
hedged liability related to the hedged risk.
Changes in the fair values of derivative financial
instruments that are designated and qualify as
hedges of expected future transactions are recog-
nized in retained earnings under equity as regards
the eective portion of the hedge. The ineective
portion is recognized in the income statement. If the
hedged transaction results in an asset or a liability,
the amount deferred in equity is transferred from
equity and recognized in the cost of the asset or the
liability, respectively. If the hedged transaction
results in an income or an expense, the amount
deferred in equity is transferred from equity to the
income statement in the period in which the hedged
transaction is recognized. The amount is recognized
in the same item as the hedged transaction.
Changes in the fair values of financial instruments
that are designated and qualify as hedges of net
investments in independent foreign subsidiaries or
associates are recognized directly in equity as
regards the eective portion of the hedge, whereas
the ineective portion is recognized in the income
statement.
Revenue
Revenue recognition
Revenue is recognized when promised goods or
services are transferred to customers in an amount
that reflects the consideration to which we expect to
be entitled in exchange for those goods or services.
We determine revenue recognition through the
following steps:
1. identification of the contract, or contracts,
with a customer;
2. identification of the performance obligations
in the contract;
3. determination of the transaction price;
4. allocation of the transaction price to the
performance obligations in the contract; and
5. recognition of revenue when, or as, we satisfy
a performance obligation.
We oer subscriptions to access our Cloud and IoT
platforms. Customers subscribe to one or more
Applications which includes data that is primarily
provided by various proprietary connected device
access points, including connectivity sensors. Our
Cloud and IoT platforms and the related connected
device access points are highly interdependent and
80Parent Company Financial Statements
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interrelated and represent a combined performance
obligation.
Deferred revenue
Deferred revenue represents amounts billed to
customers or payments received from customers for
which revenue has not yet been recognized. Deferred
revenue consists of prepayments made by customers
for future periods. A portion of customer contracts is
paid in advance for the full, multi-year term.
Additionally, the Group enables its customers to
prepay all, or part, of their contractual obligations
monthly, quarterly, or annually. As a result, the
deferred revenue balance does not represent the
total contract value of all multi-year, non-cancelable
subscription agreements. The current portion of
deferred revenue represents the amount that is
expected to be recognized within one year of the
consolidated balance sheet date.
Connected devices
Trackunit capitalizes connected devices associated
with subscription contracts. These costs are directly
related to customer. These contract fulfillment costs
are amortized over a period of benefit of three years.
Trackunit determined the period of benefit by taking
into consideration the expected life of the connected
device, the connected device’s warranty period, past
experience with customers, the duration of our
relationships with our customers and other available
information.
Other external expenses
Other external expenses comprise expenses for
premises, sales, and distribution as well as oce
expenses, etc.
Gross profit/loss
With reference to section 32 of the Danish Financial
Statements Act, gross profit/loss is calculated as a
summary of revenue, other operating income, expens-
es for raw materials and consumables and other
external expenses.
Sta expenses
Sta expenses comprise wages and salaries as well
as payroll expenses.
Amortization, depreciation, and
impairment losses
Amortization, depreciation, and impairment losses
comprise amortization, depreciation and impairment
of intangible assets and property, plant, and
equipment.
Other operating income and expenses
Other operating income and other operating
expenses comprise items of a secondary nature to
the main activities of the Company, including gains
and losses on the sale of intangible assets and
property, plant, and equipment.
Income from investments in subsidiaries
The item “Income from investments in subsidiaries”
in the income statement includes the proportionate
share of the profit for the year.
Financial income and expenses
Financial income and expenses are recognized in
the income statement at the amounts relating to
the financial year.
Tax on profit/loss for the year
Tax for the year consists of current tax for the year
and changes in deferred tax for the year. The tax
attributable to the profit for the year is recognized
in the income statement, whereas the tax attribut-
able to equity transactions is recognized directly
in equity.
The Company is jointly taxed with wholly owned
Danish and foreign subsidiaries. The tax eect of the
joint taxation is allocated to enterprises in proportion
to their taxable incomes.
Intangible assets
Development projects, patents, and licenses
Costs of development projects comprise salaries,
amortization, and other expenses directly or indirectly
attributable to the Company’s development activities.
Development projects that are clearly defined and
identifiable and in respect of which technical
feasibility, sucient resources and a potential future
market or development opportunity in the enterprise
can be demonstrated, and where it is the intention to
manufacture, market or use the project, are recog-
nized as intangible assets. This applies if sucient
certainty exists that the value in use of future earnings
can cover cost of sales, distribution and administrative
expenses involved as well as the development costs.
Development projects that do not meet the criteria for
recognition in the balance sheet are recognized as
expenses in the income statement as incurred.
Capitalized development costs are measured at cost
less accumulated amortization and impairment
losses or at a lower recoverable amount. An amount
corresponding to the recognized development costs is
allocated to the equity item “Reserve for development
costs”. The reserve comprises only development costs
recognized in financial years beginning on or after 1
January 2016. The reserve is reduced by amortization
of and impairment losses on the development
projects on a continuing basis.
81Parent Company Financial Statements
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As of the date of completion, capitalized development
costs are amortized on a straight-line basis over
the period of the expected economic benefit from
the development work. The amortization period is
3-5 years.
Licenses are measured at cost less accumulated
amortization and less any accumulated impairment
losses or at a lower value in use.
Software licenses are amortized over the period
of the agreement, which is 3-5 years.
Goodwill
Goodwill is amortized on a straight-line basis over the
estimated useful life of 10 years determined on the
basis of Management’s experience with the individual
business areas.
Property, plant and equipment
Property, plant and equipment are measured at cost
less accumulated depreciation and less any
accumulated impairment losses.
Cost comprises the cost of acquisition and expenses
directly related to the acquisition up until the time
when the asset is ready for use.
Depreciation based on cost reduced by any residual
value is calculated on a straight-line basis over the
expected useful lives of the assets, which are:
Other buildings 4 years
Plant and machinery 3-7 years
Other fixtures and fittings,
tools and equipment 3-5 years
Depreciation period and residual value are reas-
sessed annually.
Assets with a useful life less than 1 year are
expensed in the year of acquisition.
Impairment of fixed assets
The carrying amounts of intangible assets and
property, plant and equipment are reviewed on an
annual basis to determine whether there is any
indication of impairment other than that expressed
by amortization and depreciation.
If so, the asset is written down to its lower
recoverable amount.
Investments in subsidiaries
Investments in subsidiaries are recognized and
measured under the equity method.
The item “Investments in subsidiaries” in the balance
sheet include the proportionate ownership share of
the net asset value of the enterprises calculated on
the basis of the fair values of identifiable net assets
at the time of acquisition with deduction or addition
of unrealized intercompany profits or losses and with
addition of the remaining value of any increases in
value and goodwill calculated at the time of
acquisition of the enterprises.
The total net revaluation of investments in subsidiar-
ies is transferred upon distribution of profit to
“Reserve for net revaluation under the equity
method“ under equity. The reserve is reduced by
dividend distributed to the Parent Company and
adjusted for other equity movements in the
subsidiaries.
Subsidiaries with a negative net asset value are
recognized at DKK 0. Any legal or constructive
obligation of the Parent Company to cover the negative
balance of the enterprise is recognized in provisions.
Other fixed asset investments
Other fixed asset investments consist of deposit.
Inventories
Inventories are measured at the lower of cost under
the FIFO method and net realizable value.
The net realizable value of inventories is calculated at
the amount expected to be generated by sale of the
inventories in the process of normal operations with
deduction of selling expenses. The net realizable value
is determined allowing for marketability, obsoles-
cence, and development in expected selling price.
The cost of goods for resale, raw materials and
consumables equals landed cost.
The cost of finished goods and work in progress
comprises the cost of raw materials, consumables, and
direct labour with addition of indirect production costs.
Indirect production costs comprise the cost of indirect
materials and labour as well as maintenance and
depreciation of the machinery, factory buildings and
equipment used in the manufacturing process as well
as costs of factory administration and management.
Receivables
Receivables are recognized in the balance sheet at
amortized cost, which substantially corresponds to
nominal value. Provisions for estimated bad debts
are made.
Prepayments
Prepayments comprise prepaid expenses concerning
rent, insurance premiums and subscriptions.
82Parent Company Financial Statements
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Equity – Dividend
Dividend distribution proposed by Management for
the year is disclosed as a separate equity item.
Deferred tax assets and liabilities
Deferred income tax is measured using the balance
sheet liability method in respect of temporary
dierences arising between the tax bases of assets
and liabilities and their carrying amounts for
financial reporting purposes on the basis of the
intended use of the asset and settlement of the
liability, respectively.
Deferred tax assets are measured at the value at
which the asset is expected to be realized, either by
elimination in tax on future earnings or by set-o
against deferred tax liabilities within the same legal
tax entity.
Deferred tax is measured on the basis of the tax
rules and tax rates that will be eective under the
legislation at the balance sheet date when the
deferred tax is expected to crystallize as current tax.
Any changes in deferred tax due to changes to tax
rates are recognized in the income statement or in
equity if the deferred tax relates to items recognized
in equity.
Current tax receivables and liabilities
Current tax liabilities and receivables are recog-
nized in the balance sheet as the expected taxable
income for the year adjusted for tax on taxable
incomes for prior years and tax paid on account.
Extra payments and repayment under the on-ac-
count taxation scheme are recognized in the income
statement in financial income and expenses.
Financial debts
Loans, such as loans from credit institutions, are
recognized initially at the proceeds received net of
transaction expenses incurred. Subsequently, the
loans are measured at amortized cost; the dier-
ence between the proceeds and the nominal value is
recognized as an interest expense in the income
statement over the loan period.
Mortgage loans are measured at amortized cost,
which for cash loans corresponds to the remaining
loan. Amortized cost of debenture loans corresponds
to the remaining loan calculated as the underlying
cash value of the loan at the date of raising the loan
adjusted for depreciation of the price adjustment of
the loan made over the term of the loan at the date
of raising the loan.
Other debts are measured at amortized cost,
substantially corresponding to nominal value.
83Parent Company Financial Statements
The Big Picture We Are Trackunit Consolidated Financial Statements Statements ESG Financial Review
Management Statement
Executive Board
84Statements
ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements The Big Picture We Are Trackunit
Independent Auditor’s Report
85Statements
ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements The Big Picture We Are Trackunit
• Obtain an understanding of internal control relevant
• Evaluate the appropriateness of accounting policies
• Conclude on the appropriateness of Management’s
CVR No 33 77 12 31
86Statements
ESG Financial Review Consolidated Financial Statements Parent Company Financial Statements The Big Picture We Are Trackunit
