Building
the platform.
Changing
construction.
CVR No 20 75 01 70
The Annual Report
was presented and
adopted at the Annual
General Meeting of
the Company on:
21 March 2024
Chairman of the AGM
Annual Report 2023
Technology is becoming ever
more central to business,
ushering in a new data-led
era that will underpin the
transition to data operating
platforms and change the
face of construction
Together, we
eliminate downtime
to build the most
useful industry
for the world
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 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.
Our Purpose
Management
report
Financial
report
01. The big picture
Our story 5
Connecting construction 6
Building for scale 7
Five-year overview 8
Letter from the CEO 10
02. We are Trackunit
What we do 12
People power 13
Eliminate downtime.
Strengthen construction. 14
Data-driven impact 15
Expanding the ecosystem 16
A framework for impact 18
Opening doors 21
Unleashing value 22
03. ESG
Vision in practice 26
Looking inwards. Going outwards. 27
Ending ‘guestimations’ 28
Building the narrative 29
Diverse. Inclusive. Empowered. 30
Aligned. Compliant. Sustainable. 32
Serious. Ethical. Secure. 33
04. Financial review
Financial review 35
05. Consolidated
financial statements
Financial statements 37
Notes 41
06. Parent company
financial statements
Financial statements 68
Notes 72
07. Statements
Management statements 83
Independent auditors report 84
“We needed a
provider that has
similar ambitions to
us. Trackunit is also
very ambitious, and
that has led to the
creation of valuable
solutions for us, that
we turn into valuable
solutions for our
customers.”
Renta
Joel Särkkä, CIO
/3
Our
story
Trackunit is the global leader in brand-agnostic, SaaS-
based IoT solutions connecting off-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 efficient future.
M-Tec A/S established
Trackunit brand established
Organic entry into the North American
market
Circa DKK 1 billion net revenue
Launches 5G, second-generation Spot
connecting high-value, non-powered
assets to ecosystem
Signs deal for acquisition of German
ConTech startup Flexcavo
Stages first-ever Trackunit NEXT event
Trackunit Kin wins Rental Awards
Editor’s Choice 2022
Trackunit acquires Dreyer+Timm
Trackunit Iris platform launched to
market
Trackunit acquires Satrak
Introduction of mobile applications
(Trackunit On & Trackunit Go)
Eliminate Downtime movement
launched
Trackunit subsidiaries established
across Western Europe
Trackunit acquired by investment
group of Goldman Sachs and
GRO Capital
1998
2003
2015
2016
2019
2022
2023
Boosts on-year net revenue to DKK1.17b
Completes acquisition of Germany's ConTech
startup Flexcavo in January
Completes acquisition of US deployment
specialist OEM Solutions Inc. in September
Launches Emissions Reporting solutions to
establish base line in CO reporting and enable
industry to improve performance in line with
UN 2030 targets
Launches new generation of Access Management
solution to help strengthen position as market
leader in off-highway safety and ease-of-access
innovation on jobsites
Initial launch of Marketplace and Platform
SDK to facilitate ecosystem co-creation and
empower partners
1.2b
Annual Recurring
Revenue (DKK)
Trackunit Kin and bluetooth Mesh
Network introduced to market
Organic entry into APJ market
Trackunit acquired by Hg Capital
Trackunit acquires Industrial IoT
division of ZTR
2021
/5
The big picture
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 120 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.
17 120+ 60+ 26k
Monthly active usersPlatform integrationsCountries in the global ecosystemGlobal hubs
↓
↑ ↑ ↑
/6
The big picture
We are Trackunit
ESG
Financial review
Consolidated financial statements
Parent company financial statements
Statements
We’ve built a platform for long-term growth predicated
on profitable recurring revenue. We are product driven
and believe innovation is the key to unlocking new
opportunities to alleviate long-standing customer pain
points. With net revenue increasing by 32% over the
2019-23 period, we're committed to solving the problems of
today and creating the solutions for tomorrow.
2023
1.51m
1.17b
264m
1.2b
Compound Annual Growth Rate (CAGR) 2019-2023
41%
32%
40%
36%
Annualized 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 net revenue)
23%
92%
Building for
scale
0% 30% 60%
/7
The big picture
We are Trackunit
ESG
Financial review
Consolidated financial statements
Parent company financial statements
Statements
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.
• Annualized recurring revenue is
calculated as the recurring revenue
in the last month of the reporting
period times 12.
The acquisition of the Industrial IOT
division from ZTR Control Systems,
LLC, ZTR Holdings LLC and Trac Rail
Inc. (ZTR IIOT) was completed on 18th
of November 2021 and consolidated
from this date.
Figures for 2019 have not been
adjusted to the IFRS adoption made
from 1 January 2020.
' DKK
Recurring revenue % of net 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 non-recurring items - Non IFRS measure are unaudited. Management considers items totalling DKK45.1m (2022 DKK50.9m) as non-recurring. This includes costs for sharebased
payments of DKK11.3m, longer term growth initiatives of DKK24.7m as well as IoT device replacement of DKK9.2m. However for External Financial Reporting these items have been expensed as ordinary.
Five-year
overview
/8
The big picture
We are Trackunit
ESG
Financial review
Consolidated financial statements
Parent company financial statements
Statements
' 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 (%) ,% .% .% .% .%
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 annual
recurring revenue which is translated at average
exchange rate for the last month of the year.
Subscriptions
2019–2023
3.9x
EBITDA
3.8x
Employee number
2.1x
1 Non IFRS measure are unaudited.
2 Adjusted EBITDA = EBITDA before non-recurring items - Non IFRS measure are unaudited. Management considers items totalling USD6.6m (2022 USD5.2m) as non-recurring. This includes costs for sharebased
payments of USD1.6m, longer term growth initiatives of USD3.6m as well as IoT device replacement of USD1.3m. However for External Financial Reporting these items have been expensed as ordinary.
/9
The big picture
We are Trackunit
ESG
Financial review
Consolidated financial statements
Parent company financial statements
Statements
The pace of learning
Our Annual Report for 2023 may read like a roll call of key
milestones and breakthroughs, but beneath the headlines, it was
also the year when the ‘pace of learning’ began to crystallize
as a dominant theme in business and construction.
The impact of generative AI has already been
well-documented as the business story of 2023, but
an underlying and related theme crystallized through
the year that we believe will dominate for the
foreseeable future.
The ‘pace of learning’ may not be an expression on
everyone’s lips, but it soon will be. At its core, it’s a
change from a ‘know-it-all’ to a ‘learn-it-all’ mentality
that will increasingly center on how we incorporate AI
in an often challenging and unpredictable macro
environment, to ensure we keep pace with the rapid
development of technology.
We’ve already been factoring this in at Trackunit by
ensuring the workforce is as good as it can be, a key
prerequisite for adapting to that new pace. It is after
all, only because of what our teams do that we can be
useful and we are truly grateful they continue to come
to the workplace with fresh ideas, incredible energy
and a great work ethic.
We are therefore thoroughly invested in our diversity
program TIDE (Trackunit, Inclusivity, Diversity, Equity),
and through 2023, made sure we are attracting as wide
a pool of talent as possible to align with those funda-
mental principles.
We also implemented a Mindful Leadership initiative for
management to make sure we are continuously
developing a values-aligned, growth-based, psychologi-
cally safe culture. We are immensely proud that
Trackunit’s industry-standard, employee-engagement
score stands up to comparison and, by putting autono-
my in the hands of the Trackunit teams, we have fostered
a nimble, can-do approach to doing business.
Trackunit’s net revenues subsequently increased 18%
to DKK 1.17 billion, and EBITDA to DKK 264 million from
DKK 178m in 2022, strengthening our position ahead of
the major shifts we expect in construction over the next
few years.
That financial success is a reflection of the products
our teams work so diligently to build. Our Emissions
Reporting software released in October caught the
imagination of customers and the international media
because it signaled a key development in the way
construction companies can take full responsibility for
their own emissions.
Those actions might seem minor set against the cli-
mate-change tightrope highlighted so vividly at the latest
COP meeting at the end of the year. But it is only through
aggregated, ‘on-the-ground’ actions aligned with
overarching regulatory and societal influences at the
macro level that we have any hope of bringing about the
changes that might enable our industry to successfully
play its part in meeting the UN’s 2030 emissions targets.
We are just as proud of the September release of our
Access Management solution which not only has incredibly
important, on-site safety implications, but is a big step
towards the sharing economy as it opens up much bigger
opportunities for equipment pooling and sharing.
Some of our other big product moves in 2023 include
the Iris platform-powered Marketplace where we have
more than 60 new out-of-the-box integrations and apps.
There was also Sites, a data structure that allows
specific insights on projects, depots and at site level,
utilizing our bluetooth networks and complemented by
products like Trackunit Kin. That makes sure we are
creating a data-rich environment that filters through
from heavy equipment right down to non-powered tools.
This should as ever be seen through the lens of a wider
ecosystem that has set the foundations for connectivity
throughout construction with Trackunit hooking up more
than two million visible assets enabling the industry-wide
battle against downtime to gather momentum.
And it’s in that spirit that closing deals to acquire
German contractor-focused Flexcavo in January 2023
and North American deployment specialists OEMSI in
September should be viewed as part of an effort to close
the circle, make construction more efficient and be
ready for the new pace of learning.
That’s what we’re geared up for. And that’s where we
want to be headed in 2024. Welcome to the Annual
Report for 2023.
Soeren Brogaard, CEO
/10
The big picture
We are Trackunit
ESG
Financial review
Consolidated financial statements
Parent company financial statements
Statements
We are
Trackunit
02
“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 Contractors, we empower
our customers to create and consume ecosystem value to drive
a broader impact.”
Evan Barnes, Chief Operating Officer at Trackunit
We’ve built a platform that
enables our customers to
grow through the delivery of
powerful, actionable insights
that are tailored to their needs
and creates the framework
for the ecosystem to grow
organically.
Trackunit collects machine and
equipment data in real-time to
proactively deliver actionable
insights across the ecosystem. It
empowers customers with data-
driven intelligence across all of their
visible assets to improve critical
business drivers such as fleet and
machine health & utilization, operator
safety and fuel management.
Our industry-leading IoT solutions
and operating data platform benefit
the everyday operations of our
customers, supported worldwide from
our offices in the USA, UK, Germany,
France, Japan, Australia, Denmark,
Canada, Singapore, Sweden,
Norway, and The Netherlands.
Our core Iris platform harmonizes
data from our proprietary IoT
devices as well as third-party
devices, making it easy to access,
analyze and act on data insights.
Access to our Cloud and operating
data platform is provided via tiered
customer subscriptions and add-on
applications, regulating the scope,
depth, and access to game-chang-
ing insights.
We are a purpose-driven organiza-
tion 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 reputation of the
industry for innovation and
leadership.
What we do
The big picture
We are Trackunit
ESG
Financial review
Consolidated financial statements
Parent company financial statements
Statements
People
power
We continued to empower the Trackunit team to be
autonomous, responsible and flexible through 2023
while putting in place important parameters to
safeguard mental health, strengthen compassion
and create as healthy a diverse work environment
as possible.
“One of the things
that made Trackunit
stand out has been
the level of customer
service along every
step of the process.”
Great Plains Rental
Equipment
We take our responsibilities to the workforce at Trackunit
seriously because, in the end, our success is dependent
on our collective efforts. Without that, we simply can’t do
what we want to do.
We are immensely proud then to see Trackunit is
consistently in the top ten among our tech peers in
employee engagement. It shines a light on the organiza-
tion’s efforts to strengthen a whole host of initiatives
including gender ratios (30% of the current workforce is
made up of women) and the diversity strategy embodied
by TIDE (Trackunit, Inclusivity, Diversity, Equity) which
we put in place in Q4 of 2022. See ‘Diverse. Inclusive.
Empowered.’, page 30 for more.
We have a set of clear guiding principles embodied by
The Trackunit Way where the triple-focus model also
effectively 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 a strategy-driven, big-
ger-picture approach with rapid learning and feedback
loops coming together to ensure eliminating downtime
is at the heart of everything we do.
We are also passionate about embedding compassion
in the organization and both the Mindful Leadership
program and partnership with the Lighthouse Construc-
tion Industry Charity for handling mental health issues
are integral to making it a cornerstone of everything we
do. See ‘Diverse. Inclusive. Empowered.’, page 30 for
more.
That translates into a workforce that is empowered to
be useful, adaptable and open to new ways of learning.
Designed to fit with their life, it creates an environment
where they can give their best within the parameters we
set as an organization.
We will continue to make the triple focus a pillar of all
people-focused initiatives going forward and will in 2024
look to strengthen what we believe works and make sure
we’re giving the staff all the tools it needs to strengthen
The Trackunit Way and strengthen Trackunit.
Leslie Mendoza
The big picture
We are Trackunit
ESG
Financial review
Consolidated financial statements
Parent company financial statements
Statements
Eliminate downtime.
Strengthen construction.
Life is rarely black and white but we truly believe that if we can
eliminate downtime, construction will strengthen automatically.
It’s zero sum and it’s the overarching task that faces us all.
We’ve never wavered one step from our aim of eliminat-
ing downtime and, with our industry colleagues, believe
we’re getting closer to that goal.
We’re proud to be part of an industry-wide movement
that has done the groundwork to eliminate downtime in
construction and is ready to make big strides going
forward. We and our like-minded peers are firmly united
in the belief it is the fundamental issue facing the
industry and only its successful resolution will re-estab-
lish 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 earning praise 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 shows in many ways. Construction contributes 38%
of all global CO emissions, according to the World
Business Council for Sustainable Development.
Digitalization remains an ambition for many rather
than an actual fact. The sector’s safety record is good,
but it 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. Indeed, it’s
happening already.
Emissions reporting breakthroughs now enable fleet
owners to control and reduce their CO emissions
without resorting to guesswork. Digitalization is already
creating significant bottom-line efficiencies. New
access management developments have greatly
strengthened safety on-site through limiting risk-taking
behavior and restricting access to certified operators.
And automated processes are replacing 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
inefficiency 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
The big picture
We are Trackunit
ESG
Financial review
Consolidated financial statements
Parent company financial statements
Statements
Data-driven impact
Data drives the modern business world. But without
insight, it means nothing. That’s why we’ve worked hard to
make sure we have the filters in place so users can make
impactful business decisions.
We like to deliver impact at Trackunit and we have the
data to do that. But data alone does not cut it. Without
the analytics in place to turn that data into actionable
insight that helps our customers make their business
better, those numbers will simply be overwhelming.
That’s why we’ve built a secure ecosystem predicated on
taking every individual number and, bit by bit, synthesiz-
ing them so our customers can access the insights they
need. It means that as our connectivity grows, our ability
to harmonize data and provide solutions to very human
problems grows, opening opportunities for new business
and new ways of thinking.
At the micro level, that enables better operation control
over assets and sites, smarter decisions and safer choices
through our new Access Management system, strengthen-
ing the bottom line and helping the battle against
downtime. We take fuel data in over 120 different formats
and break it down into clear numbers so fleet owners can,
in tandem with our new Emissions Reporting solution,
make responsible machine usage decisions across their
fleet and establish more accurate CO numbers.
At the macro level, it’s a game changer. Those thousands
of decisions on the ground driven by those insights add
up to a potential tidal wave of collaborative, positive
developments that can collectively help to 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-effective solutions that can change the
culture and ultimately help the industry eliminate
downtime and help it get into line with 2050 carbon
targets.
We recognize it’s ambitious, but without ambition we
simply won’t get to where we want to get to. 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.
The big picture
We are Trackunit
ESG
Financial review
Consolidated financial statements
Parent company financial statements
Statements
Expanding
the ecosystem
Drive business impact through:
• Informed aftermarket visibility on equipment
usage for commercial efforts
• Improve R&D efforts by providing real-time
machine performance data
• Over-the-air connection for aftermarket services
e.g. tech applications
• Improved profitability on lower-priced machines
Boost bottom-line performances by:
• Up to a 20% improvement in aftermarket sales
• Up to a 5% reduction in equipment R&D costs
• Up to a 10% increase in sales and marketing
performance
We’re at the core of an ecosystem that becomes wider
day-by-day as the business case for connectivity and
data-driven insights, based on core principles of
transparency and data sharing, becomes overwhelming.
That matters to us as, without the ecosystem, we cannot
optimize our efforts to eliminate downtime. A strong
ecosystem is predicated on a consistent and relentless
drive to connect equipment, people, processes and
stakeholders, and we’re confident that we have the vehicle
for tackling downtime head on.
It's validation for a business model that has built-in
resilience based on the strength of our insight-focused
product development that enables it to withstand harsh
macro environments.
Contractors, OEMs, dealers, and rentals trust us because
we deliver efficiency gains and protect customer margins
in a secure environment despite spiraling energy and
logistics costs. That’s why they continue to not only work
with us, but deepen their ties to us.
That has, for example, seen the likes of Hilti deepen their
links with Trackunit to put 500,000 On!Track tags on the
platform and led to more than 60 customer integrations
and apps taking a presence on Marketplace.
Improve operations and efficiencies through:
• Depot optimization driving higher fleet
availability and revenue
• Digital workflows connecting teams across
locations
• Theft/loss prevention and improved recovery
rates
• Limiting downtime with predictive
maintenance efforts
Reduce downtime and project costs by:
• Up to 5% through identifying under-utilized
equipment Predictive maintenance initiatives
• Improving core sales by up to 20%
• Up to 15% through improving aftermarket
services
• Improving safety through digital access
control and operator integration
OEMs and Dealers
Fleet owners – Rental and Contractors
The big picture
We are Trackunit
ESG
Financial review
Consolidated financial statements
Parent company financial statements
Statements
Operating
Data Platform
Contractor
Rental
Dealer
OEM
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Core-customer value is delivered via tailored subscription
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 92,1% in 2023 with deep integrations
in customer enterprise IT solutions via APIs.
In 2023, 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 engage and facilitate
ecosystem collaboration. Spanning a broad range of
partnership archetypes, the Works With program provides
access to both create and consume ecosystem 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.
Ecosystem
Trackunit Data
Origination
Trackunit Apps
& Services
Trackunit Operating
Data Platform
Connected ecosystem
empowered to drive value
across stakeholders via
the single platform.
Flexible service able to
address broad range of
customer needs.
Single extendable platform
powering the entire
ecosystem.
Industry leading data lake
and platform.
+b data points cleaned
and harmonized on a daily
basis to fuel value creation.
Third-party players
OEM
System integrators
Rental
Industry associations
Contractor
Tool & Component OEMs
Single extendable platform
Al driven rules / analytics engine
Clean, structured, decision-grade data-lake
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
Applications & Services Suite Mobile Applications
Data cleaning and harmonization
Trackunit On
Trackunit Go
Trackunit Iris
Dealer
Business impact from the edge to cloud
The big picture
We are Trackunit
ESG
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Statements
Trackunit ManagerIntegrationsAPIs
01
Expansion of
asset class
connectivity
02
Geographic
expansion
03
Create
value-adding
services
04
Unlock
ecosystem
value
A framework
for impact
We don’t just want to drive impact ourselves, we
want to be a cornerstone for others to create
value as part of the ongoing industry battle to
eliminate downtime. That enables us to help
build industry momentum to solve long-standing
challenges that will change the face of
construction and incubate the progress that
works for society.
Strategy
We focus our resources within the
framework of delivering value and
growth across four key areas.
The big picture
We are Trackunit
ESG
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Our core is grounded in the deep understanding of off-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:
01
Expansion of asset class
connectivity
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.
We’ve previously launched Kin and strengthened our
focus on deeper integrations and the capability of our
on-site mesh network. But in 2023, our new Sites and
Access Management software took those layers of
connectivity to the next level, catalyzing the development
of a single connected ecosystem across all assets classes
in different terrains.
On site, that means all machines, including light
equipment and non-powered tools, are integrated into
an ecosystem that makes them trackable in real-time.
See ‘Unleashing value’, p 21 for more.
Our platform continues to serve as the cornerstone of a
safe, connected ecosystem, enabling 100% connectivity
via our own network, IoT devices, partner devices, and
industry data feeds.
02
Geographic
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, our presence in Asia-Pacific-Japan
continues to build the foundation for the next wave of
connectivity 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.
03
Create value-adding
services
Construction may be relatively immature in digital terms,
but there is an evolution in place and once we hit a
tipping point, it will accelerate quickly. With a common
understanding of the importance of data-driven insights,
enabling customers to securely convert insights into
impact is becoming paramount.
While our ability to expand the breadth and depth of
domain-specific insights and services generated via our
ecosystem platform continues to accelerate, we place
customer impact front and center to guide our innovation
efforts. Supporting customers on their digital journey
allows them to unlock new opportunities to drive impact
across their business, the industry and society.
04
Unlock ecosystem
value
The challenges confronting our industry are vast. We
are determined to play our part in overcoming them,
but recognize it requires collaboration and transparen-
cy to take on the full scope of the tasks that lie ahead.
Investment in the extendability 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
Contractors, we empower our customers to create and
consume ecosystem value to drive a broader impact.
The big picture
We are Trackunit
ESG
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When Herc Rentals was weighing its options some
years ago for an IoT-solutions partner, it wasn’t long
before Trackunit came into view leading to a
five-year agreement signed in August 2021. It’s
proved fruitful.
The $2.7 billion Florida-headquartered rentals
service provider then spent the best part of two
years working on its ProControl NextGen solution
before rolling it out to the market in 2023.
“We have been going through a two-year digital
transformation, with internal IT experts and
external software consultants,” COO Aaron
Birnbaum told the Trackunit NEXT conference in
January 2023. “Trackunit was there to develop our
telematics programme, and we are really excited
about taking this solution to market. It will allow
customers to take care of their fleet’s needs and
ensure we are a more effective supplier.”
That’s evident in the results. Herc has used
ProControl NextGen while also leveraging Digital
Key and the Trackunit Iris platform to deliver a
data-driven, insight-strong, market-facing solution.
On a practical level, that has helped Herc in
partnership with its customers to reduce the
incidence of theft and also control who has access
to machines at any given site and at any given
moment, helping to make businesses processes
smoother and battle downtime by ironing out
unnecessary inefficiencies.
And it hasn’t stopped there. Herc, which has an
approximate 4% share of the North American
market, collaborates closely with Trackunit to take
advantage of its API suite. Additionally, the
well-documented labor shortage in North America’s
Florida-headquartered Herc Rentals has
diligently built its position in the North America
market with a mission to help customers
achieve optimal performance safely, efficiently
and effectively. It’s just one of the reasons it
partners with Trackunit
Herc bolsters customer
trust with Trackunit
Customer case story: Herc Rentals
North America
2023
deployment industry has in one swift move been
solved by Trackunit’s acquisition to buy Chica-
go-based deployment leaders OEMSI in October
bringing benefits to Herc on the installation side
and which will over time bring even stronger levels
of professionalism to that key service segment to
the off-highway sector.
All this has enabled Herc to offer its customers a
level of service on both the physical and digital
side that helps them stand out from their competi-
tion. With Emissions Reporting and Access
Management insights now also available, that will
enable them to continue to keep users locked in
and create further value for both Herc and its
customers down the line.
Herc is at the cutting edge of technology and, as
its customers increasingly demand insights across
a wide variety of areas and applications that are
reliant on innovation-led IoT platforms like
Trackunit, it’s become something of a self-fulfilling
prophecy. And while Trackunit will never rest on its
laurels, the strength of the partnership between the
two is such that it is very hopeful this relationship
will be extended when it comes to its contractual
end in 2026.
Opening doors
Products
We set a marker in 2023 for innovation that not only opens new
frontiers for our customers, but can also enable construction to
make significant steps forward to assuming its rightful position
as a force for progress and good.
We don’t set limits on what we can achieve at Trackunit.
Instead, we ask the team to be inquisitive, to have a ‘what
if…’ mentality, and to aim for the improbable.
In many ways, 2023 has embodied that spirit more than
any other year as we made significant innovation
breakthroughs that will help define off-highway
construction over the coming decade.
Our pivotal Emissions Reporting software release in
October delivered for the first time a truly viable
technological complement to the regulatory and societal
pressures needed to bring emissions in line with the UN’s
2030 targets. The industry previously relied on estimates
to piece together their emissions data but this software
is based on hard numbers and real insight meaning an
end to that practice through delivering a bottom-line
benchmark for all machines going forward. See page 23
for more.
We’ve also raised the standard on access management
that has not just made the typical construction job site a
safer place to be, but has also energized the battle
against downtime by creating better equipment usage
such as the pooling of tools, and the standardization of
training and education on all machine operators in
high-risk categories.
That feeds into the overall effort to make construction
more connected via the Sites release in early 2023 that
has in conjunction with Beam helped create an ecosystem
where efficiencies are fostered, and utilization is the name
of the game. See page 23 for more. It means our users can
track everything on site and between sites enabling
benchmarking and site-performance assessments, a
development enhanced by our acquisition of contrac-
tor-focused Flexcavo as the vehicle for enabling contrac-
tors to schedule and plan on site and better serve client
demands.
An underlying principle here is the harmonization and
purification of data from our data lake to make all those
numbers useful, insightful and accessible. The extendabili-
ty of the Iris operating data platform is at the heart of this
revolution offering a suite of APIs on Marketplace that can
deliver various and extensive solutions integrated into the
Trackunit ecosystem.
What that means is total overview, something we’ve
also endeavoured to deliver on the physical side of the
equation with the acquisition of deployment specialists
OEMSI in the fall of 2023. It has helped engineer an
integrated ecosystem that via Bluetooth, has proved
attractive to our OEM partners to deepen their links with
Trackunit and leverage the network opportunities to
deliver better solutions for its customers.
Add these to previous product breakthroughs and the
clear strategy to piece together the jigsaw and build the
links becomes evident. We like to join the dots and believe
we’re getting there. And that only happens when we
harmonize people, products and processes in the interests
of making construction more transparent and better.
It was a breakthrough
year for innovation as
our Access
Management and
Emissions Reporting
solutions led the way
in driving market
impact.
The big picture
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Unleashing
value
Trackunit Iris is our operating data
platform that is at the heart of everything
we do and will do for years to come.
Designed to be safe, secure, and scalable,
Iris is also ISO 27001 certified and delivers
impactful insights via our customer-facing
Marketplace and its extensive API suite.
With circa 2 million connected assets and
more than 2.0bn data points added daily,
Iris's ability to aggregate mixed-fleet data
on a single platform, provides a single
source of data to foster new businesses
and accelerate connectivity.
Trackunit Manager is the purpose-built
fleet manager solution for construction,
connecting, collecting, and presenting
real-time mixed-fleet and site-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 and
site performance.
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,
management-of-fleet capabilities. For
users, it is a complete tool for fleet
management at their disposal.
Software Software SoftwareEnabling Devices Enabling Devices Enabling Devices
Trackunit
Iris
Trackunit
Manager
Trackunit
Go
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. It is
the perfect conduit for our access-man-
agement software release allowing users
to know exactly what is happening on
their job site via a smartphone.
Software Enabling Devices
Trackunit
On
We’re committed to innovation, but not for
innovation’s sake. If it doesn’t make things better or
easier for our partners then it’s no longer serving its
purpose. This fundamental principle underpins
everything we do on the product-building front.
That’s why we deliberately invest significant
resource in products because we believe in the
enormous potential of IoT and are committed to
maintaining our position as the leader in providing
software and IoT devices to the off-highway
construction sector.
Our core solutions help our partners manage their
fleets to ensure the correct and efficient use of
machinery and non-powered equipment, reduce
CO emissions and offer 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 digitaliza-
tion 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. Here’s a taste of some
of what we do.
We build our products for one purpose and for one purpose only.
If it delivers value to the customer, then we’re serving the industry.
And if it doesn’t, we think again, reassemble, and move on.
The big picture
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Emissions Reporting is the game-chang-
ing software that puts ownership of
emissions firmly in the hand of every
machine operator and which will eventual-
ly end the practice of ‘guesstimating’.
With a ‘no-machine-left-behind’ mantra, it
makes data instantly accessible delivering
far more accurate CO numbers and puts
the off-highway sector into a position to
meet UN 2030 emissions targets. See
‘Ending guestimations’, page 28 for more.
Our second-generation, access-
management solution enhances
fleet-owner control by opening up the
road to standardized digital access
control by negating the need for ‘no
permission’ keys while simultaneously
making construction sites safer. It will
also digitalize workflows and give site
operators full overview of everything
related to access that happens under
their watch.
Market bestseller Trackunit Raw is a
compact cellular IoT device, which
delivers stable, secure, and reliable
connectivity. Coverage serves all major
markets 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.
The second-generation Trackunit Spot is
a 5G-ready solution that is easy to install
and has transformed the non-powered
construction equipment sector. A
‘slap-and-track’ device, it bridges the gap
between Trackunit Raw and Trackunit Kin
and has helped complete the circle on the
connectivity loop.
Trackunit Kin is a Bluetooth 5.2 IoT device
that leverages our Bluetooth mesh
network across all asset classes. It is
simple yet powerful, enabling 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 Beam solutions help you grow
and build new digital processes to bridge
the connections between equipment,
fleets, and sites for every project phase. It
is designed to withstand the rigors of
harsh site environments and is
industry-certified and ratified.
Software Software Software Software Software SoftwareEnabling Devices Enabling Devices Enabling Devices Enabling Devices Enabling Devices Enabling Devices
Emissions
Reporting
Access
Management
Trackunit
Raw
Trackunit
Spot
Trackunit
Kin
Trackunit
Beam
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Statements
More significantly, Botany was able to build a
picture of how it could ensure it was using its fleet
more efficiently, understand why machines were
sometimes idle and take steps to utilize the fleet
better to get more rent.
“We could see almost straightaway the unrealized
rental values as well as the impact on manual
processes,” said John Medland, Director at Botany.
“What it has enabled us to do is to make sure that
equipment is ready to be rented, depending on
whether it might need some service or maintenance.
“In essence, it’s given us much greater insight into
the life cycle of our machines and take action
accordingly.”
That in turn has enabled Botany to service its
customers in New South Wales, Victoria and
Queensland armed with data and insights that
directly benefit their businesses and strengthen the
relationship between Botany and its partners.
“We can give customers actionable data that means
they can always keep their project running like
letting them know if fuel levels are low or if their
battery needs charging,” said Medland.
Botany is also excited by the other insights Trackunit
offers. As a safety-obsessed organization, Trackunit’s
new generation Access Management could in time
become a very significant source of insight for
Botany and the Emissions Reporting software could
also become an integral part of its business when it
bids for big government- or state-mandated projects
with rigorous sustainability criteria.
When Australia’s Botany Access wanted to have
a rethink on its IoT partner with a view to raising
the bottom line, a scour of the market quickly
put Trackunit at the top of its wanted list
Australian rental Botany
gets bottom-line boost
from Trackunit
Customer case story: Botany Access
Australia
2022
But for now, Botany remains fixated on the bottom-
line improvements as it works with the Trackunit
ecosystem and builds its knowledge slowly but
surely of how to get the best out of the partnership.
With circa 65% of the fleet connected, the next step
will be to hook up the rest of its machines and adapt
accordingly.
“It’s been nearly a year and we’re really seeing the
benefits of working with Trackunit,” said Medland.
“We work in lots of different terrains including tunnels
and we’ve started using Trackunit there too to pinpoint
more accurately where our machines are.”
When you’re in the business of renting out elevated
work platforms, safety is by definition a non-negotia-
ble and for Australia’s Botany Access, it’s no different.
It’s why it offers all users EWP training in Sydney and
as an organization, it is at pains to make sure it gives
its clients clear guidance to get the most out of its
machines.
While the safety element is integral to that, there
is also a bottom-line consideration as the better
trained Botany’s customers are, the more likely
they are to use its equipment in a cost-effective,
risk-reducing way.
That line of thought was very much present when
Botany wanted to make its Enterprise Resource
Planning system work better for the business.
Sydney-headquartered Botany approached
Trackunit in early 2023 because, although it was
already using IoT solutions to analyze data, it wasn’t
delivering the results it had hoped for.
Trackunit demonstrated how it could hook up all of
Botany’s fleet to the ERP so that it could immediately
begin to see how that automation would significantly
cut back on time-consuming, manual checks and
make an immediate impact on cost considerations.
ESG
03
“Our Emissions Reporting software sets a baseline-metric
on reporting and ensures companies will be able to bid for big
contracts with clear, verifiable numbers that validate their
credibility and enhance their chances of winning major
government-and state-led projects.”
Lærke Ullerup, Chief Product & Marketing Officer at Trackunit
Trackunit has taken big steps through 2023
to strengthen its ESG targets and initiatives
across the board with clear direction on
diversity and inclusion, emissions and
energy, and compliance and security.
It’s part of an ongoing, rigorous
reinforcement of the company vision and
strategy allied to practice, bolstering
Trackunit’s reputation as a responsible
and progressive, ESG-compliant partner.
Vision in practice
Environmental: Trackunit delivers
IoT solutions to customers including
its flagship Emissions Reporting
software release in October, enabling
users to record and monitor carbon
emissions to a far greater degree
than ever before. That means
Trackunit can enable our customers to
address their scope 1 and 2 emissions
of the Greenhouse Gas Protocol
framework while taking important
steps on its scope 1 and 2 outputs to
mitigate emissions. See ‘Ending
guestimations’, page 28 for more.
Societal: Trackunit has in 2023
implemented its Mindful Leadership
program encouraging more
compassionate leaders and better
mental-health awareness. We
continue to push hard on addressing
gender imbalances at mid- and
senior-management level, our
well-established diversity and
inclusion program TIDE (Trackunit
Inclusivity, Diversity and Equity),
and employee engagement. We want
to play our part in making construc-
tion a more attractive, more diverse
industry open to all.
See ‘Diverse. Inclusive. Empowered.’,
page 30 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. We have
significantly strengthened our
compliance training to instil a high
level of risk understanding and
mitigation among employees and on
cyber security, we are ISO/IEC 27001
certified. See ‘Aligned. Compliant.
Sustainable’, page 32 for more.
/26
We are Trackunit
ESG
The big picture
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Commitment
Set up a travel
policy that is
efficient, smart
and measurable
Looking inwards.
Going outwards.
This was the year we formalized our commitment as
a company to making our contribution to reducing
carbon emissions as part of the Greenhouse Gas
Protocol framework.
to manage our scope 2 target with a 100% renewable
energy target in place for 2025 from a current 43%,
a commitment to using recycled IT equipment, and a
travel policy that is efficient, smart and measurable.
It’s the breakthrough we’ve worked incredibly hard to
get to and the one that we believe will be transformative
in construction. It’s the game changer.
See ‘Ending guestimations’, page 28 for more.
Commitment
Using
recycled IT
equipment
Commitment
100%
renewable
energy for
scope 2
by 2025
2023: 43%
We’ve been steadily building our environmental
credentials ever since we joined the UN Global Compact
initiative and switched the Trackunit headquarters in
Aalborg to green energy in 2019.
But we really initiated a gear change in 2023 by
committing to the Greenhouse Gas Protocol framework.
We are now working with Normative, a standard setter
for sustainable practice in technology companies, and
will this year commit to the stipulations of the UN’s
Science Based Targets Initiative which helps set goals as
part of the vision to create a net-zero world by 2050.
That means we are fully dedicated to reducing scope
1, 2 and 3 emissions measuring these in a variety of
metrics including per revenue, per employee and per
customer. On a practical level, we’ve taken quick action
Environment
/27
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Ending ‘guestimations’
Establishing a methodology that enables the off-highway
sector to accurately measure its carbon emissions has
proved an immensely difficult task. But the introduction of
Trackunit’s Emissions Reporting software has changed that
and will eventually spell the end of ‘guestimations’.
We set a goal of giving the off-highway sector in
construction a methodology that would enable it to
measure carbon emissions with accuracy and in virtual
real time long ago, and have been relentless in driving
that mission.
And after many years of trials, testing, retesting and
adapting, we’ve finally got there. Our Emissions Reporting
software release in October harnesses synthesized
machine metadata and individual equipment to unlock
comprehensive total fleet emissions for every machine.
It’s not for nothing that we say ‘no machine left behind’
and fleet owners and the individual machine operators
now have in their hands the data and insight to read
exactly what is happening with any given machine on
emissions and take action accordingly.
As well as delivering a far greater degree of accuracy
than ever before, it sets a baseline-metric on emissions
reporting and ensures companies will be able to bid for
big contracts with clear, verifiable numbers that validate
their credibility and enhance their chances of winning
major government-and state-led projects with strict
environmental criteria.
It means that as the technology gains traction, the
practice of ‘guestimating’ emissions should gradually
diminish until it becomes obsolete. For customers, that
matters as they strengthen their credentials when bidding
for those big state-mandated projects with strict
emissions-reporting criteria.
It also helps put the off-highway sector on the right side of
the debate as construction looks to make its contribution to
meeting the UN’s 2030 reduction in emissions targets and
helps incubate a culture of ownership and responsibility
throughout the industry on individual emissions output.
It’s measurement of greenhouse gases to scale and it puts
the scope 1 and 2 elements of the Greenhouse Gas
Protocol within reach of the logistics chain, breaking
down one of the most difficult barriers to measuring
emissions for our customers. And now that we’ve got to
here, we’ll be working consistently and relentlessly to test,
refine and improve the model so we can continue to raise
that bar higher and higher. It’s what this industry
deserves.
The fusion of regulatory pressure, societal drives,
technology and the cultural shift towards accountability
is driving this change. With the Emissions Reporting
software release, we have now given our customers a
critical piece of the jigsaw.
Our Emissions
Reporting software
release in October
harnesses synthesized
machine metadata
and individual
equipment to unlock
comprehensive total
fleet emissions for
every machine.
Environment
/28
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“Trackunit is able
to manage the
relationship with our
customers very well
meaning that they
often resolve their
issues directly and
without us having to
support too much.
Our customers
really see Trackunit
as a plus.”
Magni
Building the
narrative
Building an industry consensus that
puts construction on the right side of
the narrative is a central pillar of our
strategy. We believe collective action is
essential to delivering outcomes that
put the environment at the top of
everyone’s agenda.
That is embodied in our flagship Trackunit NEXT confer-
ence which helps to kickstart every year in January and
sets the focus for the year ahead, downtime events
including the Tokyo Downtime Talks in November, and our
continued membership of industry bodies like the Commit-
tee for European Construction Equipment.
These events are not about Trackunit. They are about the
industry and we pull in key influencers to make sure we’re
fueling the debate in a way that is constructive and
potentially decisive using every channel at our disposal
such as podcasts, keynote speaking slots and interviews
with industry players to spark the conversation.
We have also rigorously pursued our thought-leadership
position across a wide variety of topics including
sustainability, working hard with international media to
ensure we’re flavoring the conversation and reaching an
audience that vastly expands our scope beyond our own
channels.
That has meant numerous article pickups in key media
titles through North America, Europe and Asia because
they trust what we say and, having carefully cultivated
those editorial relationships, we have established a
gravitas that means we can infuse the narrative and
galvanize colleagues into action. It’s a consistent and
constant element in what we do and something we will
strengthen through 2024.
Environment
Voices matter. And every voice helps. But put those voices
together as one collective and then we suddenly create a
volume and clarity that can make a real difference at the
macro level.
That’s something we have worked very hard to achieve in
2023. We’ve been active in driving the agenda forward
with like-minded industry colleagues to strengthen the
battle on downtime and as one very significant element
of that, put the environment at the head of everyone’s
to-do list.
Alessandro Pastorelli,
Global Service Manager
/29
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408
Employees
40+
Nationalities
/30
We are Trackunit
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Trackunit have an ambitious ESG Strategy in place for the entire Trackunit Group (including all companies including and below the ultimate Parent Company GALAXY UK Topco Ltd.). Above actuals and
targets are for the entire Trackunit Group. Due to Danish accounting requirements, certain targets are to be set and measured differently from above. Female representation at Trackunit C-level with a
2025 target of 20% and actual 2023 of 11%, Female representation at Trackunit Management roles with a 2025 target of 31% and actual 2023 of 23%.
/31
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The big picture
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We are fully aligned and committed to UN Sustainable Development Goals
and have made significant progress through 2023 on various initiatives.
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Financial
review
04
“Breaking through the DKK 1 billion revenue barrier is
a significant milestone in Trackunit’s history and we’ve been
able to consolidate our position through 2023 as a company
with a strong track record of financial growth, responsibility
and stability.”
Peter Vekslund, Chief Finance Officer at Trackunit
Developments in
activities and financial
affairs 2023
Trackunit began 2023 with the acquisition of the German
Con-Tech company Flexcavo GmbH. Flexcavo offers a
unique software solution to the contractor segment within
machine connectivity which therefore provides a perfect
fit for the Trackunit product suite.
In September, Trackunit acquired North American field
services expert OEM Solutions LLC which strengthens
Trackunit’s global IoT enablement and deployment
capabilities. After the acquisition, Trackunit can offer the
customers a complete service throughout the lifecycle of
connected equipment.
In 2023, Trackunit reached the milestone of exceeding
DKK 1 billion in revenue through a continuous focus on
profitable growth. Further, Trackunit added net 29
employees and the group now employs more than 400
people globally.
Work on the simplification of the legal structure began in
2022 and in 2023, the consolidation of the UK entities was
completed, resulting in one operating company.
The income statement shows a positive EBITDA of DKK264
million and a positive net profit of DKK34m. The profit is
materially influenced by costs related to the acquisitions
above and by high inflation during 2022 and 2023, that
have affected cost prices. Also management considers items
totalling DKK45.2m as non-recurring. This includes costs
for sharebased payments of DKK11.3m, longer term
growth initiatives of DKK24,7m as well as IoT device
replacement of DKK9.2m. However, for external reporting,
the items have been expensed as ordinary.
Profit for the period are further impacted by significant
amortization of intangible assets primarily related to the
acquisition of the IIOT division of ZTR.
The financial result for 2023 is in line with expectations.
In the financial statement for 2022, Trackunit expected
revenue to be in the range of DKK1.1-1.3bn and EBITDA in
the range of DKK250-350m. The financial result for 2023
is considered satisfactory.
Significant changes in operations and financial
matters
There are no other significant changes in operations and
financial matters that have affected recognition and
measurement of the Groups results and financial status.
Unusual conditions that affect recognition and
measurement
There are no unusual factors that have affected
recognition and measurement of the Groups results
and financial status.
Outlook
Management is positive going into 2024 and by delivering
on the corporate strategy, revenue for 2024 is expected in
the range of DKK1.2-1.4bn and EBITDA in the range
DKK300-400m.
Significant assumptions and uncertainties
There are no material conditions and uncertainties that
affect the Group’s results and balance sheet.
Risk factors
Activities in foreign countries and hereby earnings,
exchange rates and interest rates of various currencies
affect cash flows and equity. Adjustment of investments in
subsidiaries and associates that are independent entities,
are recognized directly in equity. Currency risks related to
sales in transactional currencies different from DKK are
not hedged while overall cashflow in different currencies
are to some degree aligned (natural hedge).
Development activities
The development activities primarily include development
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 of Machines Over The Air – all described in the
Product Roadmap.
Significant events after the balance sheet date
There are no significant events after the balance
sheet date.
ESG
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Consolidated
financial
statements
05
41 Note 1 Critical Accounting Estimates and Judgements
42 Note 2 Revenue from Contracts with Customers
44 Note 3 Sta Costs
45 Note 4 Share-based Payment
46 Note 5 Audit Fees
46 Note 6 Special Non-Recurring Items
47 Note 7 Financial Income and Expenses
48 Note 8 Income Tax
50 Note 9 Distribution of Profit/Loss
51 Note 10 Intangible Assets
55 Note 11 Property, Plant and Equipment
56 Note 12 Leases as Lessee
57 Note 13 Inventories
58 Note 14 Trade Receivables
59 Note 15 Financial Assets and Liabilities
60 Note 16 Share Capital
60 Note 17 Related Parties
60 Note 18 Commitments and Contingent Liabilities
61 Note 19 Business Combinations
62 Note 20 Financial Risk Management
64 Note 21 Events After the Balance Sheet Date
64 Note 22 Changes in Net Working Capital
64 Note 23 Group Companies
65 Note 24 Basis of Preparation
' DKK Notes
Revenue from contracts with customers 1,168,020 990,963
Cost of providing services (435,971 ) (405,211 )
Gross Profit 732,049 585,752
External costs (108,751 ) (108,871 )
Other operating expenses (28 ) (57 )
Employee costs (359,200 ) (299,086 )
Earnings before depreciation, amortization and
impairment (EBITDA), and before special items 264,070 177,739
Special non-recurring items (53,491 ) (31,245 )
Depreciation, amortization costs and impairment loss of
property, plant and equipment and intangible assets , , (159,118 ) (160,254 )
Earnings before interest and tax (EBIT) 51,462 (13,761 )
Finance income 12,490 9,018
Finance costs , (12,472 ) (19,314 )
Earnings before tax (EBT) 51,480 (24,058 )
Income tax expense (17,819 ) 10,521
Profit/(Loss) for the period 33,661 (13,537 )
' DKK Notes
Profit/(loss) for the period 33,661 (13,537 )
Other comprehensive income
Items that may be reclassified to profit or loss
Exchange differences regarding subsidiaries in another currency (19,318 ) 20,130
Other comprehensive income for the period, net of tax (19,318 ) 20,130
Total comprehensive income for the period 14,343 6,593
Consolidated statement of profit and loss
1 January – 31 December
Consolidated statement of comprehensive income
1 January – 31 December
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Consolidated balance sheet – 31 December
Assets
Consolidated balance sheet – 31 December
Equity and liabilities
' DKK Notes
Non-current assets
Intangible assets 1,889,279 1,997,074
Property, plant and equipment 9,867 9,520
Right-of-use assets 30,339 38,539
Deferred tax assets 46,525 42,781
Connected devices 177,655 217,605
Deposits 2,344 2,226
Total non-current assets 2,156,009 2,307,745
Current assets
Inventories 37,469 40,449
Trade receivables , 176,587 181,957
Receivables from group enterprises 389,210 171,468
Connected devices 208,460 153,614
Other financial assets at amortised cost 21,892 13,650
Other current assets 26,072 47,402
Cash and cash equivalents 158,596 37,418
Total current assets 1,018,286 645,958
Total assets 3,174,295 2,953,703
' DKK Notes
Share capital 500 500
Share premium 1,140,938 1,140,938
Other reserves 1,447 20,765
Retained earnings 262,212 217,225
Total equity 1,405,097 1,379,428
Lease liabilities , 20,561 28,343
Deferred tax liabilities 169,462 189,083
Deferred revenue 553,459 454,022
Total non-current liabilities 743,482 671,448
Lease liabilities , 10,597 10,591
Trade and other payables 125,841 116,908
Payables to group enterprises 329,674 310,988
Current income tax liabilities 41,855 17,912
Deferred revenue 517,750 446,428
Total current liabilities 1,025,717 902,827
Total liabilities 1,769,199 1,574,275
Total equity and liabilities 3,174,295 2,953,703
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Notes
Critical accounting estimates and judgements
Share-based payment
Related parties
Commitments and contingent liabilities
Business combinations
Financial risk management
Events after the balance sheet date
Group companies
Basis of preparation
' DKK
Share
capital
Share
premium
Other reserves –
Foreign currency
translation
Retained
earnings
Total
equity
Balance at January 500 1,140,938 20,765 217,225 1,379,428
Profit for the period 0 0 0 33,661 33,661
Other comprehensive income 0 0 (19,318 ) 0 (19,318 )
Total comprehensive income for the period 0 0 (19,318 ) 33,661 14,343
Transactions with owners in their capacity as owners
Share-based payment 0 0 0 11,326 11,326
Balance at December 500 1,140,938 1,447 262,212 1,405,097
' DKK
Share
capital
Share
premium
Other reserves –
Foreign currency
translation
Retained
earnings
Total
equity
Balance at January 500 1,140,938 635 224,945 1,367,018
Profit for the period 0 0 0 (13,537 ) (13,537 )
Other comprehensive income 0 0 20,130 0 20,130
Total comprehensive income for the period 0 0 20,130 (13,537 ) 6,593
Transactions with owners in their capacity as owners
Share-based payment 0 0 0 5,817 5,817
Balance at December 500 1,140,938 20,765 217,225 1,379,428
Consolidated statement of changes in equity
January 1 – December 31
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Consolidated cash flow statement
1 January – 31 December
' DKK Notes
Earnings before interest and tax (EBIT) 51,462 (13,761 )
Depreciations and amortizations 159,118 160,254
Non-cash items 11,354 5,874
Change in net working capital 172,945 56,379
Cash flows from primary operating activities 394,878 208,745
Received interests 11,896 7,176
Paid interests (21,113 ) (26,433 )
Paid income taxes (20,460 ) (17,315 )
Cash flow from operating activities 365,201 172,173
Purchase of property, plant and equipment (6,486 ) (7,023 )
Sale of property, plant and equipment 22,188 75
Purchase of intangible assets (17,843 ) (22,762 )
Change in deposits 936 (467 )
Business acquisitions (net of cash acquired) (19,038 ) 0
Cash flow from investing activities (20,243 ) (30,177 )
' DKK Notes
Cash flow from investing activities (,) (,)
Repayments to credit institutions (22,327 ) 0
Other financing to/from Group enterprises (200,901 ) (201,809 )
Lease principal payments (10,754 ) (9,626 )
Cash flow from financing activities (233,982 ) (211,435 )
Net cash flow for the year 110,977 (69,439 )
Cash and cash equivalents, beginning of the period 37,418 94,964
Unrealized exchange rate gains and losses 10,202 11,894
Cash and cash equivalents, end of the year 158,596 37,418
The cash flow statement cannot be derived from
the published financial information only.
Cash and cash equivalents 158,596 37,418
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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 affect 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 assumptions and
estimates could result in outcomes that require a material
adjustment to the carrying amount of assets or liabilities
affected 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.
The Group 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.
The Group offer 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
The Group capitalize connected devices associated with
subscription contracts. These contract fulfillment cost are
directly related to customers, and the costs are amortized
over a period of benefit of three years. The Group
determined 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 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-generating 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.
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.
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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 interdepen-
dent 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 per-
formance obligation. Contracts that contain multiple
performance obligations require an allocation of the
transaction price to each performance 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 performance
obligations.
Recognition of revenue when or as Trackunit satisfies
a performance obligation
Trackunit satisfies substantially all of its performance
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 customers, 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 installation services.
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' 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 , ,
Acquired deferred
revenue
Deferred revenue
beginning of period,
herof recognized in
the period (,) (,)
Deferred revenue
invoiced in the period ,, ,,
Revenue recognized
and billed 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. Additionally, 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 subscrip-
tion 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 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 Trackunit’s relationships 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.
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3. Staff costs
' DKK
Wages and salaries , ,
Termination benefits
Social security costs , ,
Pension costs, defined contribution plans , ,
Other employee costs , ,
Total staff cost , ,
Average number of full time employees 408 379
' DKK
Salaries and other short-term employee benefits , ,
Post-employment benefits ,
Total staff 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 management in key
affiliates. 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
staff related costs. Staff costs are recognized in the
financial year during which the employees
performed the related work.
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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 non-executive employees in
2022. The purpose is to share the value creation eventual-
ly 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 2,087,160 warrants at 31 December
2023 (2022: 1,520,000). 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 2023 was
684,660 (2022 1,520,000). The total fair value of the
progamme is DKK 17.1m, (2022 DKK5.8m).
The valuation is based on the following assumptions:
• Vesting period: 4 years
• Expected volatility: 44%
– based on peer group analysis
• Risk free interest rate: 2,5%
Total expenses arising from the incentive programme
is DKK 11.3m (2022 DKK5.8m) and is recognized as
staff cost.
§ Accounting policy
The group operates an 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.
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5. Audit Fees
' DKK
Statutory audit , ,
Audit-related services
Tax advisory services
Other services
Total 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-off nature in relation to the Group's
primary activities. Special items relate to M&A
activities, restructuring costs, consultancy cost for
systems implementations, costs regarding integra-
tion and significant non-recurring items including
cost related to change of members to the board and
executive management.
M&A – includes external cost for lawyers, advisors and
auditors related to M&A activities, as well as cost
regarding integration (end of life products and termina-
tion of office lease etc.)
Consultancy – includes cost for implementation of a new
ERP system and a new HR-IS system. The ERP implementa-
tion has been completed in 2023 while the HR-IS imple-
mentation has been ongoing during 2023.
Restructuring – includes costs (Servance payments and
recruitment cost) related to change of members of the
Board of Directors and the Executive Management.
Also management considers items totalling DKK45.1m as
non-recurring. This includes costs for sharebased
payments of DKK11.3m, longer term growth initiatives of
DKK24.7m as well as IoT device replacement of DKK9.2m.
However for External Financial Reporting these items
have been expensed as ordinary.
Group elected auditor – PwC
Non-group elected auditor
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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 recog-
nized at the amounts relating to the financial year.
' DKK
Interest income, banks ,
Exchange rate adjustments , ,
Other interest income
Total financial income , ,
Interest expenses, mortgage debt and borrowings
Interest and finance charges for lease liabilities , ,
Interest paid from Group enterprises , ,
Other financial expenses, including bank fees , ,
Total financial cost , ,
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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 differences (,) (,)
Total deferred tax (,) (,)
Income tax expenses for the period , (,)
Profit before tax , (,)
Computed % (,) ,
Tax effects of:
Effect of income/expenses that is exempt from taxation (,) (,)
Effect of not recognized tax assets
Effect of different tax rates of subsidiaries operating in other jurisdictions (,)
Effect of opening balance adjustment to deferred tax , ,
Effect of tax on profit for prior years () ()
Other ,
Tax charge (,) ,
Income tax expenses for the period (,) ,
§ 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.
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§ Accounting policy
Deferred income tax is recognized on temporary
differences arising between the tax bases of assets and
liabilities and their carrying amounts in the Consolidat-
ed 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 transac-
tion, affects 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 differences
can be utilized.
Deferred income tax liabilities are provided on taxable
temporary differences arising from investments in
subsidiaries, except for deferred income tax liability
where the timing of the reversal of the temporary
difference is controlled by the Group and it is probable
that the temporary difference will not reverse in the
foreseeable future.
Deferred income tax assets are recognized on
deductible temporary differences arising from
investments in subsidiaries, only to the extent that it is
probable that the temporary difference will reverse in
the future and that there is sufficient taxable profit
available, against which the temporary difference can
be utilized.
Deferred income tax assets and liabilities are offset
when there is a legally enforceable right to offset
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 different
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 recognized 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 realized in a foreseeable future, the
deferred tax assets has been recognized.
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' 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 (,) ,
Tax loss carry forward (,)
Other liabilities , (,)
, ,
Of the deferred tax liability DKK 115.8m is expected to
be recovered after more than 12 months.
9. Distribution of profit/loss
' DKK
Proposed dividend for the year
Retained earnings , (,)
, (,)
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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 accumu-
lated 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 met:
• 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. Develop-
ment costs previously recognized as an expense are not
recognized as an asset in a subsequent 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 amortiza-
tion 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.
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' DKK Goodwill Trademarks
Customer
relations Software
Software
order book
Technology
platform
Completed
development
projects
Development
projects
in progress Total
Cost:
At January ,, , , , , , , , ,,
Exchange differences (,) () (,) () () (,)
Addition acquisition of subsidiary , , , ,
Additions during the year , , ,
Disposals (,) (,) () (,)
Reclassifications , (,)
As at December ,, , , , , , , , ,,
Amortization and impairment:
At January , , , , , , ,
Exchange differences () () ()
Amortization charge , , , , , ,
Disposals (,) (,) (,)
As at December , , , , , , ,
Carrying amount December ,, , , , , , , ,,
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' DKK Goodwill Trademarks
Customer
relations Software
Software
order book
Technology
platform
Completed
development
projects
Development
projects
in progress Total
Cost:
At January ,, , , , , , , , ,,
Exchange differences , () (,) () (,) ,
Additions during the year , , ,
Disposals (,) (,)
Reclassifications ()
As at December ,, , , , , , , , ,,
Amortization and impairment:
At January , , , , , , ,
Exchange differences () (,) () (,) (,)
Amortization charge , , , , , , ,
Disposals (,) (,)
As at December , , , , , , ,
Carrying amount December ,, , , , , , , ,,
Research and development cost included in the income statement amounts to DKK34.8m (2022: DKK45.5m).
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Impairment test for goodwill
Impairment test was performed at the end of 2023. The
impairment test was based on the cash-generating-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-generat-
ing 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 2024 and business plans for 2025-2026. 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 10%-19% during the budget and strategy period.
The growth rate beyond the budget and forecast periods
(the terminal period) is considered to be 2%. All growth
rates is based on management 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 12,0%.
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 simultaneous 1 percent-
age point increase in WACC and 1 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 in 2021. 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
calculation are still present. Further the majority of the
booked value of customer relations can be allocated to
the acquisition made in 2021. As there have been no signif-
icant changes to the customer base since the acquisition
impairment will not be required.
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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 impair-
ment 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 differences () () ()
Addition on acquisition of subsidiary , ,
Additions during the year , , ,
Disposals during the year (,) (,) (,)
As at December , , ,
Amortization and impairment:
At January , , ,
Exchange differences () ()
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 differences () () ()
Additions during the year , , ,
Disposals during the year (,) () (,)
As at December , , ,
Amortization and impairment:
At January , , ,
Exchange differences () () ()
Depreciation for the year , , ,
Depreciation of disposed assets (,) () (,)
As at December , , ,
Carrying amount December , , ,
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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, offices, and other
equipment. From 1 January 2019, leases are recognized
as a right-of-use asset and a corresponding 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 (<
DKK35.000).
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 compo-
nents 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 (4,5%).
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.
Offices
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 offices is set the
same date as the headquarter in Aalborg office expires
even though different terms of condition may occur. The
groups incremental borrowing rate to obtain an asset of
similar value of 4,5% 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 (4,5%).
' 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.
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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 deprecia-
tion 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’ , ,
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14. Trade Receivables
§ Accounting policy
Receivables are measured at amortized cost. Receiv-
ables 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
difference between carrying amount and present value
of expected cash flows, including the expected
realizable value of any collateral provided. The
discount rate is the effective 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-offs 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 2022
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.
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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. Invest-
ments 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 substan-
tially 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 difference
between cost and nominal value. Losses and gains on
loans are thus allocated over the term so that the
effective 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 , ,
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.
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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 2023 were DKK0 (2022: DKK0).
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 2023, the group’s strategy was to maintain the
gearing ratio below 10%. The gearing ratio at 31
December 2023 was -10.0% (2022: 0.1%).
The group is owned by Galaxy Bidco ApS, who owns
100% of the shares.
Galaxy UK Topco Limited is the ultimate parent of the
Trackunit in the Group. Majority shareholder of Galaxy
UK Topco Limited is 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 25% 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 share capital comprises 500,000 shares of a
nominal value of DKK1 each.
All shares are fully issues and paid. One share
holds one vote.
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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 combination 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 difference 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 indepen-
dent 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 2023
On January 1 2023 Trackunit acquired the German
Con-Tech company Flexcavo GmbH. Flexcavo offers a
unique software solution to the contractor segment
within Machine connectivity which therefore provides
a perfect fit for the Trackunit product suite.
On September 29 2023 Trackunit acquired the North
American field service expert OEM Solutions LLC. OEM
Solutions LLC is a deployment specialist operating
across North America with a network of certified
technicians. The acquisition enables Trackunit to
respond to the increasing customer demands for scaled
installation services and give the opportunity to offer
customers a complete service throughout the life cycle
of connected equipment.
Acquisition of Flexcavo GmbH
The acquisition of Flexcavo GmbH was completed with
an acquisition date on January 1 2023. The total
consideration paid amounts to a cash consideration of
DKK9.7m. No equity instruments have been issued and
there is no contingent consideration in the business
combination.
Fair value of the assets and liabilities acquired is
summarized in the following table, which discloses
recognized amounts of identifiable assets acquired and
liabilities assumed. Goodwill covers the acquisition of
know-how and employees, which do not qualify for
recognition as a separate asset.
' DKK
Net assets acquired
Intangible assets ,
Tangible assets ,
Other non-current assets ,
Cash ,
Current assets
Other non-current liabilities (,)
Deferred tax liabilities (,)
Other current liabilities (,)
Net assets ,
Consideration paid ,
Goodwill ,
Acquisition-related costs of DKK0.5m have been charged
to special items in the consolidated income statement for
the year ended 31 December 2023 (2022 DKK1.5m).
The revenue included in the consolidated statement of
comprehensive income since 1 January 2023 contributed
by Flexcavo GmbH was DKK1.9m.
Of the total profit in the consolidated statement of profit
and loss amounting to DKK32.2m Flexcavo GmbH
contributed with a loss of DKK-17m.
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' DKK
Net assets acquired
Intangible assets
Cash ,
Current assets ,
Deferred tax liabilities ()
Other current liabilities (,)
Net assets ,
Consideration paid ,
Goodwill ,
Acquisition of OEM Solutions LLC
The acquisition of OEM Solutions LLC was completed
with an acquisition date on September 29 2023. The
total consideration paid amounts to a cash consider-
ation of DKK21.1m. No equity instruments have been
issued and there is no contingent consideration in the
business combination. On December 29 2023 OEM
Solutions LLC was merged with Trackunit Inc. with
Trackunit Inc. as the continuing company.
Fair value of the assets and liabilities acquired is
summarized in the following table, which discloses
recognized amounts of identifiable assets acquired and
liabilities assumed. Goodwill covers the acquisition of
know-how and employees, which do not qualify for
recognition as a separate asset.
Acquisition-related costs of DKK3.2m have been
charged to special items in the consolidated income
statement for the year ended 31 December 2023.
The revenue included in the consolidated statement of
comprehensive income since 29 September 2023
contributed by OEM Solutions LLC was DKK7.6m.
Had OEM Solutions LLC been consolidated from 1
January 2023, the consolidated statement of income
would include proforma revenue of DKK30.4m and
profit of DKK12.2m.
Of the total profit in the consolidated statement of
profit and loss amounting to DKK32.2m OEM Solutions
LLC contributed with a profit of DKK3.3m.
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 effects
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 affect 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 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.
20. Financial risk management
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.
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' DKK
Net Profit
Equity
Net Profit
Equity
USD (,) (,) (,) (,)
GBP , ,
CAD (,) (,) (,) (,)
Interest rate risk
The Groups interest rate risk arises from long-term borrow-
ings 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.
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, no
sensitivity analysis is needed for 2023 and 2022.
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 sufficient cash to
meet operational needs while always maintaining
sufficient 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 consider-
ation the group’s debt financing plans, covenant
compliance and compliance with internal balance sheet
ratio targets.
Financial covenants
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 , ,
, , ,
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Statements
No subsequent events have occurred after the balance
sheet date that required adjustment to or disclosure in
the consolidated financial statements.
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 office 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 %
Trackunit GmbH Germany %
– Flexcavo GmbH Germany %
Trackunit BV Netherlands %
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Statements
This note provides a list of the significant accounting
policies adopted in the preparation of these consolidated
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.
General
The Consolidated Financial Statements for Trackunit ApS
have been prepared in accordance with IFRS Accounting
Standards as issued by the International Accounting
Standards Board (IASB) and as adopted by the European
Union as well as additional Danish disclosure require-
ments applying to entities of reporting class C.
The annual report is prepared according to standards and
interpretations effective for financial years beginning on 1
January 2023. 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 standards and
amendments for the first time for its annual reporting
period commencing 1 January 2023:
• IFRS 17 Insurance Contracts
• Definition of Accounting Estimates
– amendments to IAS 8
24. Basis of preparation
• International Tax Reform
– Pillar Two Model Rules – amendments to IAS 12.
The group also elected to adopt the following amend-
ments early:
• Amendments to IAS 1 – Classification of Liabilities as
Current or Non-current and Amendments to IAS 1 –
Non-current Liabilities with Covenants.
The amendments listed above did not have any impact on
the amounts recognized in prior periods and are not
expected to significantly affect the current or future periods.
New standards, amendments and interpretations
adopted but not yet effective
Certain new accounting standards and interpretations
have been published that are not mandatory for 31
December 2023 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 affect
those returns through its power over the entity. Subsidiar-
ies are fully consolidated from the date on which control is
transferred to the group. They are deconsolidated from
the date that control ceases.
Intercompany 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 subsidiaries 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).
The financial statements are presented in Danish Kroner
(DKK), which is Trackunit ApS’ functional and presentation
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-mea-
sured. 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 different 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 differences 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
closing rate. Exchange differences 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
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Statements
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.
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Statements
72 Note 1 Sta costs
72 Note 2 Share-based payment
73 Note 3 Sepreciation, 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
76 Note 12 Prepayments
76 Note 13 Share capital
76 Note 14 Distribution of profit/loss
76 Note 15 Provision for deferred tax
77 Note 16 Long-term debt
77 Note 17 Deferred revenue
77 Note 18 Contingent assets, liabilities,
and financial obligations
77 Note 19 Events after the balance sheet date
77 Note 20 Related parties
78 Note 21 Accounting policies
Parent
company
financial
statements
06
Parent statement of profit and loss
1 January – 31 December
' DKK Notes
Net revenue , ,
Cost of goods sold (,) (,)
Gross Profit/ (Loss) , ,
External costs (,) (,)
Staff expenses (,) (,)
Profit/ loss before depreciations , ,
Depreciation, amortization costs and impairment of
intangible assets and property, plant and equipment (,) (,)
Other operating expenses (,) (,)
Profit before depreciations , ,
Finance income , ,
Finance costs (,) (,)
Earnings before tax , ,
Income tax expense (,) (,)
Profit/(Loss) for the period , ,
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' 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
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Parent balance sheet – 31 December
Equity and liabilities
' DKK Notes
Share capital
Reserve for development cost , ,
Retained earnings ,, ,,
Total equity ,, ,,
Provision for deferred tax , ,
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
Accounting policies
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' DKK
Share
capital
Reserve for net
revaluation under
the equity method
Reserve for
development
costs
Retained
earnings
Total
equity
Balance at January , ,, ,,
Development costs for the year , (,)
Amortization for the year (,) ,
Net profit/loss for the year , ,
Balance at December , ,, ,,
Balance at January (,) , ,, ,,
Accumulated effect of change in accounting policy , ,
Balance at January , , ,, ,,
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
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1. Staff costs
' DKK
Wages and salaries , ,
Pensions , ,
Other social security costs ,
Other employee costs , ,
Total staff 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 non-executive 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 940,120 warrants at 31 December 2023
(2022: 777,000). Each warrant gives the holder right to
share capital of DKK 0.01 nominal value in the ultimate
parent company Galaxy UK Topco Ltd.
The total number of warrants granted in 2023 was 217,720.
The total fair value of the progamme is DKK8.0m.
The valuation is based on the following assumptions:
• Vesting period: 4 years
• Expected volatility: 44% – based on peer group
analysis
• Risk free interest rate: 2,5%
Total expenses arising from the incentive programme in
2023 is DKK5.0m (2022 DKK 3.0m).
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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
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 , ,
, ,
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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 development of products and services that are ready for sale.
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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 ,, ,,
Additions for the year
Cost af December ,, ,,
Investment in subsidiaries are specified as follows:
Name and registered office 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 %
Trackunit GmbH Germany %
– Flexcavo GmbH Germany %
Trackunit BV Netherlands %
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' 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 13. 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 DKK27.4m for 2023 (2022: DKK44.4m) and
consist of prepaid expenses concerning rent, insurance premiums and
subscriptions.
' DKK
Retained earnings , ,
, ,
Provision for deffered 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 tax
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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 DKK271.3m in 2023 (2022: DKK189.3m)
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.
No 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:
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Statements
The Annual Report of Trackunit ApS for 2023 has been
prepared in accordance with the provisions of the
Danish Financial Statements Act applying to reporting
class C (large).
Recognition and measurement of financial instruments
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 International
Financial Reporting Standards (IFRS 16).
The Financial Statements for 2023 are presented in
000’ DKK.
Change in accounting policy
Recognition and measurement of investments in
subsidiaries has been changed.
Before the change investment in subsidiaries were
recognized and measured under the equity method. To
align with Group policy Investments in subsidiaries are
now recognized and measured at cost in the balance
sheet and dividend from subsidiaries are recognized as
income in the financial year in which the dividend is
declared.
The change in recognition and measurement of
investment in subsidiaries has affected last year result
with DKK19.5m. The change in accounting policy have
had no effect on the calculated tax. Comparative
figures in the balance sheet have been restated in
accordance with the new accounting policy.
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 previously 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, offices, and other
equipment. From 1 January 2019, leases are recognized
as a right-of-use asset and a corresponding 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 compo-
nents 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 4.5%.
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.
Offices
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 offices is set the
same date as the HQ office expires even though
different 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 4.5% for Offices
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 4.5%.
21. Accounting policies
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Translation policies
Transactions in foreign currencies are translated at the
exchange rates at the dates of transaction. Gains and
losses arising due to differences between the transac-
tion 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 differences 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 adjustments
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 recognized
in the balance sheet at cost and are subsequently
remeasured at their fair values. Positive and negative fair
values of derivative financial instruments 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 designated
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 recog-
nized 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 recognized in
retained earnings under equity as regards the effective
portion of the hedge. The ineffective 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 recog-
nized in the cost of the asset or the liability, respective-
ly. 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 invest-
ments in independent foreign subsidiaries or associates
are recognized directly in equity as regards the effective
portion of the hedge, whereas the ineffective 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 offer 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.
Deferred revenue
Deferred revenue represents amounts billed to custom-
ers 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 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.
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 office
expenses, etc.
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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, expenses
for raw materials and consumables and other external
expenses.
Staff expenses
Staff 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.
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 attributable to equity
transactions is recognized directly in equity.
The Company is jointly taxed with wholly owned Danish
and foreign subsidiaries. The tax effect 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,
sufficient resources and a potential future market or
development opportunity in the enterprise can be
demonstrated, and where it is the intention to manufac-
ture, market or use the project, are recognized as
intangible assets. This applies if sufficient 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 correspond-
ing 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 impair-
ment losses on the development projects on a continu-
ing basis.
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 accumulat-
ed 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 reassessed
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 at cost. If the cost exceeds the recoverable
amount, it is written down.
Dividend from subsidiaries are recognized as income in
the financial year in which the dividend is declared.
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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, obsolescence,
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.
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 differenc-
es 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-off
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 effective 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 recognized 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-account 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 difference 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, substan-
tially corresponding to nominal value.
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Statements
07
“In our supercharged, switched-on, modern-day working environ-
ment, it’s important to make sure we’re taking every step to look
after one another. This is not about ticking the boxes. It’s about
making sure we are a lean and healthy organization where people
are able to give their best.”
Flemming Karsten’s Søeberg, Chief People Officer at Trackunit
Executive Board
Management
statement
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report
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CVR No 33 77 12 31
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Trackunit ApS
CVR No 20 75 01 70
Gasværksvej 24, 4.
9000 Aalborg