Accelerating Positive Change Together
Annual Report
2025
Introduction
3 Who we are
4 Strategies governing our work
5 Letter to stakeholders
7 Hempel Foundation 2025
highlights
8 Key figures
9 Engaged ownership
10 Ownership purpose and values
11 2025 in Hempel A/S Group
12 Financial performance in
Hempel A/S Group
13 Financial investments
14 Hempel Foundation’s
investment strategy
16 Sustainable investment
policy
17 Philanthropy
18 Philanthropic strategy
20 Philanthropic activities in 2025
23 Our grantmaking in numbers
24 Achievements within our focus areas
1. Education
2. International biodiversity
3. Rewilding in Denmark
4. Science, CoAST
5. Social initiatives
34 Foundation governance
35 Governance structure and
composition
36 Board structure
37 Board committees
38 Operational aspects of governance
40 Financial performance
41 Consolidated financial results for
the Hempel Foundation Group
43 Hempel Foundation’s financial
results
44 Sustainability statement
45 Statutory statement on
sustainability
46 Our business model
48 Statements
49 Management’s statement
50 Independent auditor’s report
52 Financial statements
53 Consolidated financial statements
98 Hempel Foundation financial
statements
Contents
← Learners at a Roots to Rise
community camp in Bugiri
District, Eastern Uganda make
words using letter cards.
Photo credit: Emmanuel Kizaale,
Building Tomorrow
Picture at the front page:
Nørholm Wilderness in Denmark
is one of the newest areas now
included in The Wilderness,
where the Hempel Foundation
will carry out nature restoration.
Photo: Lars Hestbæk, Hempel
Foundation
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 2PhilanthropyIntroduction Engaged ownership
The Hempel Foundation Group is the
entire group of companies owned by
the Hempel Foundation.
The Hempel A/S Group consists of
Hempel A/S and its subsidiaries.
Ownership structure
Hempel Foundation
Hempel Ejendomme A/S Hempel Invest A/S
Hempel A/S Group
Hempel Invest II ApS
Hempel Administration ApS
Brænderupvænge ApS
Keldskov ApS
Who we are
The Hempel Foundation is the long-term majority
owner of the Hempel A/S Group, a global coatings
company. The Foundation was established in
1948 by Jørgen Christian Hempel.
According to the Foundation Charter our primary
purpose is to ensure a strong and stable financial
foundation for Hempel A/S Group, securing its
long-term development and value creation.
Our secondary purpose is philanthropic. Guided
by the principles outlined in the Foundation
Charter, we strive to make a lasting and sustaina-
ble impact on some of the world’s most pressing
challenges.
Our philanthropic strategy focuses on ensuring
quality education for all children, sustaining key
biodiversity areas in global hotspots, restoring
nature in Denmark, where we have developed
and are implementing “The Wilderness”,
developing sustainable coating solutions and
strengthening well-being and resilience of
children and youth in Denmark.
We take a strategic approach to philanthropy,
aiming to drive positive change and accelerate
impact. We do so by helping organisations scale
their impact through both our financial and
non-financial resources.
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 3PhilanthropyEngaged ownershipIntroduction
Strategies governing our work
Ownership Strategy
Our long-term strategic ownership of
Hempel A/S Group represents our most
significant and important investment and
is governed and managed in accordance
with our ownership strategy, which defines
our role, values and objectives.
Read more on page 10
Investment Strategy
Our financial investments are governed by our
financial investment strategy. The investment
strategy establishes overall guidelines and
policies for capital allocation and investments
in different types of assets: financial invest-
ments, properties, alternative investments
and impact investments.
Read more on page 14
Philanthropic Strategy
Our philanthropic strategy defines the
role we aim for within our philanthropic
work, the longer term changes we strive
to achieve and the main levers that we
apply to accelerate positive change that we
believe will drive positive impact.
Read more on page 18
The Hempel Foundation Group
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 4PhilanthropyEngaged ownershipIntroduction
Letter to
stakeholders
A year of progress in challenging times
In a year characterised by increased global com-
plexity and shifting external conditions, 2025
was marked by both progress and important
developments for the Hempel Foundation Group.
In this environment, we remained focused on our
long-term mission of creating positive change
for people and nature, while navigating more
demanding conditions across both our business
and our philanthropic work.
Engaged ownership of the Hempel A/S Group
2025 marked the first full year with CVC Funds
as a minority investor in Hempel A/S. Through-
out the year, the Hempel Foundation supported
the company in this new ownership structure.
The collaboration has been constructive, trust-
based and professional, with strong alignment
around governance, strategic priorities and long-
term value creation.
We are confident that this partnership strengthens
Hempel A/S’s platform for sustainable growth
and supports our ability to continue delivering
long-term philanthropic impact.
The Hempel A/S Group landed on a total revenue
of EUR 2,165 million in 2025, in a demanding
market environment especially related to
currency impact, mainly from USD depreciation.
Despite this, the Hempel A/S Group delivered
solid results with an organic sales growth of
3.4%. The adjusted EBITDA of the year landed
at EUR 394 million corresponding to an adjusted
EBITDA margin of 18.2%, which is the best to
date for the Hempel A/S Group. The improved
adjusted EBITDA margin is a consequence of
improved gross margin and good cost control.
Additionally, the Hempel A/S Group delivered
a strong improvement in free cash flow, which
increased by EUR 120 million to EUR 259 million.
At the same time, the Hempel A/S Group
maintained a strong focus on customer value,
innovation and operational discipline. The company
progressed on its strategic priorities and in the
beginning of 2026 it entered a new strategic
phase, “Accelerate to Win”, positioning the
Hempel A/S Group for continued development
and long-term value creation in the years ahead.
↑ Amaliegade 8, Copenhagen. The Hempel Foundation office. Photo: Hempel Foundation
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 5PhilanthropyEngaged ownershipIntroduction
Financial investments
The Hempel Foundation Group has a strong
financial reserve and grew this during 2025.
Our overall financial return from the financial
investments amounted to EUR 23 million in
2025. We find our overall financial return for
the year to be satisfactory.
Philanthropy
In 2025, we spent EUR 28 million on our
philanthropic work.
Through the year we strengthened our efforts
to improve children’s education in low-income
countries and provided more than 600,000
children with access to quality schooling and
opportunities for a brighter future. Another
highlight in education was the announcement
of the Foundational Learning Initiative for
Government- led Transformation (FLIGHT) in
collaboration with other major donors.
At the same time, we advanced our work to
sustain biodiversity, protecting ecosystems that
are essential for life on Earth. Most notably we
launched an initiative to undertake a compre-
hensive 25-year update of the existing map of
the world’s biodiversity hotspots. The results of
this work will be publicly launched in 2027, and
in 2026 we will allocate further resources within
the Hempel Foundation to continue driving the
initiative forward as an initiative anchored within
the Hempel Foundation.
This work will guide nature conservation
authorities, donors and practitioners working
in biodiversity hotspots, as well as the scientific
community, for decades to come.
In Denmark, we started delivering on our
acceleration concept, marking a shift towards
multi-year support with a strong focus on
organisational capacity strengthening to help
organisations grow their long-term impact.
The concept has been well received by our
partners, which now include Ventilen Danmark,
Settlementet Vesterbro, GirlTalk.dk and
Børnehjælpsdagen.
In our nature restoration work in Denmark, a
key milestone was reached with the acquisition
of three more unique nature sites – the Mols
Laboratory, the Asnæs Peninsula and the Nørholm
Estate. Together with Saksfjed Wilderness,
these acquisitions form the foundation of
The Wilderness, an initiative designed to unite
research, education and practical action to
identify the most effective ways to transform
land taken out of production and allow it to return
to biodiversity- rich nature.
The four wilderness areas cover a total of nearly
2,500 hectares (25 square kilometres) and will
truly enable us to accelerate nature restoration
in Denmark over the coming years.
2026 and beyond
Our focus in the coming years is to ensure that
we meet the ambitious goals for growth and
value creation in the Hempel A/S Group, both
financially and in terms of sustainability.
For our philanthropic work, with our strength-
ened platform and capacities, we aim to secure
an even stronger impact within our core focus
areas. We expect to increase our overall level of
philanthropy further in the coming years.
There are still millions of children in the world’s
poorest countries who lack basic literacy skills, a
biodiversity crisis that continues to worsen, and
significant work needed in Denmark to both restore
biodiversity and enable more children to thrive.
Our key focus areas will be creating even more
value for our philanthropic partners and scaling
our rewilding initiatives within Denmark.
Thank you
We would like to extend our sincere gratitude to
all our partners worldwide, who work tirelessly
to create sustainable, positive change for the
children most in need and the important nature
most at risk. We also extend our deepest gratitude
to the management and employees of the
Hempel A/S Group, whose daily work makes all
our philanthropic work possible.
Richard Sand Anders Holm
Chair CEO
↑ Chair of the Board of the Hempel Foundation, Richard Sand, and, to the right,
CEO of the Hempel Foundation, Anders Holm. Photo: Lars Hestbæk, Hempel Foundation
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 6PhilanthropyEngaged ownershipIntroduction
2,500
hectares now under
effort for rewilding
Expanded The Wilderness with three new
sites in Denmark
Launched partnerships to strengthen the
evidence base for rewilding and translating
knowledge into action
Released 30 tauros into the wild at Saksfjed
Wilderness – the first tauros in Denmark!
600
thousand children in 2025 with better
access to quality education
Launched a partnership in Madagascar to fight learning
poverty
Joined forces with philanthropic funders to translate
foundational learning commitments from governments
into actions for children
13,700
children and youth in Denmark reached
with inclusive and meaningful activities
on water through our Søsat programme
First acceleration partner, Girl Talk, introduced
Scaling up our Acceleration partnerships
in Denmark – committing an additional
EUR 1.2 million in funding
25
peer-reviewed journal
publications
Expanded the
CoaST (The Coatings
Science and Technology Centre)
Exposure Facilities which will enable
extensive long-term studies of
anti-corrosive coating systems
Successful automation of a system for
making fouling assessments under
water.
4.4
million hectares of tropical forest
supported to sustain biodiversity
Expanded our biodiversity support to five new
landscapes totaling 550,000 hectares in Indo
-
nesia, Madagascar and Tanzania
Launched an initiative to map the world’s
Biodiversity Hotspots
Social Initiatives
Reaching a significant milestone
Supporting 1.5 million children with access
to quality learning since 2010
2021 2022 2023 2024 2025
1.5 million
180
thousand
Hempel Foundation
2025
highlights
Our focus areas
Coating Tech
Education
Biodiversity
Rewilding
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 7PhilanthropyEngaged ownershipIntroduction
Key figures
(EUR m) 2025 2024 2023
Profit and loss
Revenue 2,169 2,185 2,172
EBITDA 385 391 344
EBITDA, adjusted 392 392 356
Amortisation, depreciation and impairment 105 116 110
Operating profit 280 279 234
Financial items, net - 50 - 32 - 62
Profit before tax 230 247 172
Net profit for continuing operations 183 197 152
Net profit for the year 185 107 80
Financial position
Total assets 3,023 3,326 3,066
Investment in tangible assets 50 56 72
Foundation equity 1,423 1,363 887
Net interest-bearing debt 331 525 1,005
Cash flow
Total cash flow from operating activities 324 239 135
Cash flow from acquisitions / divestments of enterprises 8 4 6
Cash flow from net investments in property, plant and equipment and
intangible assets
- 61 - 93 - 105
Free cash flow 285 - 44 36
Grants/Donations 32 27 23
Working capital
Net working capital (NWC) days 76 82 66
The calculation of NWC days has been restated to reflect a simplified approach.
2023 was the first year the Hempel Foundation Group presented its consolidated financial statement in
accordance with IFRS, therefore two majority years of comparable figures are presented.
(%) 2025 2024 2023
Ratios (%)
Organic growth 3.7 -1.3 14.1
Gross margin 44.2 43.4 41.5
EBITDA margin 17.8 17.9 15.8
EBITDA margin, adjusted 18.1 17.9 16.4
Operating profit margin 12.9 12.8 10.8
Return on invested capital (ROIC)
1
10.3 10.4 10.3
Equity ratio 47.1 42.1 28.9
Cash conversion 0.8 0.6 0.4
Leverage ratio 0.9 1.3 2.9
For definitions of financial ratios, see page 99.
1
Including adjustment for hyperinflation
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 8PhilanthropyEngaged ownershipIntroduction
Engaged
ownership
→ Ownership purpose
and values
→ 2025 in Hempel A/S Group
→ Financial performance
in Hempel A/S Group
Galloways in Saksfjed Wilderness, Denmark.
Photo: Jens Thorving Andersen, Hempel Foundation.
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 9PhilanthropyIntroduction Engaged ownership
Hempel Foundation Annual Report 2025
↑ Photo: Hempel A/S
Ownership
purpose and values
The Hempel Foundation is the majority owner
of the Hempel A/S Group, a global coatings
company. According to the Foundation Charter,
the Foundation’s primary purpose is to:
“(...) secure and reinforce the
financial platform for the
continued existence and
development of the businesses
operated by Hempel A/S and
its affiliates on a commercially
and financially sound basis.”
The Hempel Foundation has been the sole
owner of Hempel A/S since the Foundation
was established in 1948. In 2024, the Hempel
Foundation invited CVC Funds to become a
minority investor in Hempel A/S to help accelerate
Hempel’s ambitious long-term growth strategy.
The role of the Foundation, our values and
objectives
The Foundation aims to be an active and
engaged owner, supporting the fulfilment of
the following objective:
○ To support the development of Hempel A/S
into one of the world’s largest and most sus-
tainable coatings companies, which, through
its operations and results, contributes to a
more sustainable world.
○ The Foundation’s role is to set the overall
structure and principles for the company’s
long-term development and to ensure the
development supports our objectives.
The Foundation promotes the following values in
its ownership:
○ Ambition: The Hempel Foundation is ambitious
and supports Hempel A/S in striving to
achieve its full potential.
○ Responsibility: The Hempel Foundation is
committed to acting responsibly and supports
Hempel A/S in doing the same.
○ Long-term perspective: As the long-term
majority owner of Hempel A/S, the Hempel
Foundation is committed to creating
sustainable value through dedicated support of
the company’s continued focus on innovation,
research and development.
The Foundation prioritises long-term strategic
initiatives and has limited appetite for high-
risk, short-term measures.
○ Sustainability: The Hempel Foundation
strives to benefit society and contribute to
a more sustainable world. This is achieved
through the Foundation’s philanthropic work
and by supporting Hempel A/S in becoming
a global market leader in sustainability within
its industry.
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 10PhilanthropyIntroduction Engaged ownership
2025 in the Hempel A/S Group
Hempel A/S Group’s purpose and strategic
objective
The Hempel A/S Group collaborates and
innovates with customers to deliver paints and
coatings that protect, inspire and improve the
performance of their most valuable assets.
Through global expertise and strong partner-
ships, the Hempel A/S Group helps customers
achieve their ambitions and strengthen their
performance over time.
Sustainability is at the heart of the business and
incorporated into every step of the business model.
The Hempel Foundation is the majority owner of
the Hempel A/S Group.
Partnering for accelerated growth
In 2024, the Hempel Foundation advanced the
strategic ambitions of the Hempel A/S Group,
including welcoming CVC as a minority investor
and strategic partner. 2025 was therefore the
first year with joint ownership of the Hempel A/S
Group with CVC.
Strategy update
In 2025, the Hempel A/S Group concluded
its “Double Impact” strategy period, a five-year
journey that strengthened the group and delivered
tangible financial progress across four strategic
growth levers: segment leadership, sustainability
leader, scalable operations and trusted partner.
The achievements of “Double Impact” have
ensured that the Hempel A/S Group is ready for
the next phase in its growth journey, which will be
guided by the new “Accelerate to win” strategy,
launched in January 2026.
Key achievements of “growth levers”
Digital transformation was a key enabler for
“Double Impact”. In 2025, the Hempel A/S
Group launched the new, unified eBusiness
platform, integrating hempel.com and MyHempel
into one seamless and intuitive digital experience.
In 2025, the Hempel A/S Group maintained
momentum across all segments as it looked
to cement leadership positions. In Marine, the
Hempel A/S Group celebrated the 5,000
th
application of Hempaguard, an advanced silicone
hull coating, marking a decade of proven hull
performance and reinforcing the Hempel A/S
Group’s leadership in fuel-saving and emission-
reducing coatings.
In Energy & Infrastructure, Avantguard 750
Pro set a new standard for corrosion protection,
helping to extend the lifetime of steel structures
and reduce lifecycle CO
2
emissions. In addition,
Hempafire Extreme 550 redefined fire protection
with faster application, lower carbon content and
enhanced design flexibility.
In Decorative, the Hempel A/S Group strength-
ened the market position of Farrow & Ball,
driven by US expansion and the introduction
of a new studio retail format with five Studios
offering immersive retail spaces that elevate the
customer experience. The Hempel A/S Group
can already see that sales are outperforming the
market. In addition it launched an award-winning
e-commerce proposition.
Maximise customer value
Focus on a winning portfolio
Advancing sustainability leadership
Sustainability is central to how the Hempel A/S
Group creates value for customers, owners and
society. In 2025, EcoVadis awarded the Hempel
a Bronze Medal, placing the group among the
top 35% of rated companies globally within
ESG performance. The Hempel A/S Group
also updated its “Scope 3” emissions target,
which is validated by the Science Based Targets
initiative (SBTi) to align with the 1.5°C pathway
while ensuring that profitability and climate
responsibility go hand in hand.
Accelerate to win is our commitment to faster,
focused growth. It directs our energy to where
we can create the greatest impact and pushes
us to raise our game in delivering value for our
customers.
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 11PhilanthropyIntroduction Engaged ownership
Financial performance
in Hempel A/S Group
Revenue and organic growth
Total revenue in 2025 showed a slight decrease
of EUR 20 million and landed at EUR 2,165
million. Revenue was negatively impacted by
the depreciation of US dollar, British pound and
Chinese yuan exchange rates against the euro.
Organic growth for the year was 3.4%, driven by
underlying volume growth.
When viewing performance by segment, the
highlights are as follows.
The Marine segment delivered organic growth of
9.8 %, reporting revenue for the year of EUR 750
million which consolidated the Marine segment
as the second largest in the Hempel A/S Group.
Growth in the Marine segment was fuelled by
sustained customer confidence and continued
demand for the Hempel A/S Group’s premium
solutions. At the same time, however, macro-
economic uncertainty, a declining US dollar and
price pressure from increased competition in the
silicone market negatively impacted growth.
The Energy & Infrastructure segment remained
the largest segment, ending the year with revenue
of EUR 775 million which was stable compared
to 2024. Revenue was secured by successfully
winning more volume across the globe, with
a focus on the Hempel A/S Group’s leading
technologies within strategic areas – such as
passive fire protection (PFP), high-performance
waterproofing (Neogard) and corrosion
protection (Avantguard).
The Decorative segment delivered slight growth
of 0.6% with revenue amounting to EUR 640
million. This growth was supported by increases in
the luxury segment through Farrow & Ball and in
the UK mainstream market through Crown Paints.
Gross profit and margin
Gross profit increased by 0.7 % in 2025, ending
the year at EUR 955 million. The gross profit
margin increased by 0.7 percentage points, end-
ing the year at 44.1 %. The positive development
was driven by reduced raw material costs as well
as operational efficiencies, mainly in China.
This was countered by impacts from unfavourable
currency development of USD denominated
revenue.
Adjusted EBITDA result and margin
Adjusted EBITDA increased in 2025 to
EUR 394 million despite a slightly lower revenue,
leading to an improved adjusted EBITDA margin
of 18.2% supported by strong cost management
as well as reduced raw material costs.
Net profit and tax
Net profit for 2025 amounted to EUR 168 million,
significantly above last year (EUR 80 million),
which was impacted negatively from a loss related
to discontinued operations.
Tax for 2025 amounted to EUR 47 million com-
pared to EUR 50 million in 2024, resulting in an
effective tax rate of 22.1 % in 2025.
Free cash flow, debt leverage and dividends
Free cash flow amounted to EUR 259 million
in 2025, up from EUR 139 million in 2024.
The improvement was primarily driven by
better net working capital management, lower
investments in property, plant and equipment
(PPE) and intangible assets, and reduced
interest expenses.
The leverage ratio improved significantly,
decreasing to 0.9 (relative to EBITDA) in
December 2025, compared to a ratio of 1.4 in
December 2024. Finally, there were no dividend
payments or changes in equity financing for the
Hempel A/S Group in 2025.
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 12PhilanthropyIntroduction Engaged ownership
→ Hempel Foundation’s
investment strategy
→ Sustainable investment
policy
Financial
investments
Photo: Hempel A/S
Sustainability statementFoundation governance Financial performance Statements Financial statements 13PhilanthropyIntroduction Engaged ownership Financial investments
Hempel Foundation Annual Report 2025
Hempel Foundation’s
investment strategy
For our financial investments the Hempel
Foundation’s Board of Directors has set down
overall guidelines and policies for capital
allocation and investments in different types
of assets: financial investments, properties,
alternative investments and impact investments.
The Investment Committee prepares decisions
on the Foundation’s investment activities, which
are finally approved by the Board.
Investment decisions are governed by a financial
investment strategy which is reviewed annually by
the Investment Committee and approved by the
Board. This investment strategy is aligned with the
purpose outlined in the Foundation Charter.
The main objective of the investment strategy is
to secure long-term value creation in accordance
with the risk appetite defined by the Board of
Directors. Return on investments is monitored by
the Investment Committee on an ongoing basis
and reviewed by the Board of Directors.
The Hempel Foundation is invested for the long-
term and the overall return is assessed in the
perspective of a longer time horizon. The target
allocation of the financial investment portfolio is
exemplified to the right.
The Hempel Foundation maintains the majority
of its assets in liquid investments. This is a core
element of the investment strategy governing
the financial investment portfolio. In line with
previous years, the investment strategy maintains
a higher allocation to equities than historically,
accepting greater annual volatility in pursuit of
higher expected returns.
The purpose of the investment strategy is to
build long-term asset value to support and
expand the Foundation’s philanthropic activities.
Target allocation
Shares
50 %
Bonds
15 %
Alternative investments
8 %
Cash equivalent
2 %
Real estate
25 %
Financial investments
Financial investments in shares, bonds, CLOs
etc., are for the major part managed by exter-
nal professional portfolio managers. Portfolio
management is split between several managers
to increase the risk-adjusted net return of the
total portfolio.
The majority of investments are in listed securi-
ties that can be redeemed within a few days.
According to the annual wheel, the Investment
Committee must conduct an annual review of
the performance of the portfolio managers.
This decision reflects our proactive approach
to portfolio management and our unwavering
commitment to achieving the best possible
outcomes for our investments. No changes to
fund managers were implemented in 2025.
Hempel Foundation Annual Report 2025
Sustainability statementFoundation governance Financial performance Statements Financial statements 14PhilanthropyIntroduction Engaged ownership Financial investments
↑ Photo: Hempel A/S
Property and land investments
The Hempel Foundation’s real estate
investments are predominantly placed in the
sub sidiary Hempel Ejendomme A/S. Hempel
Ejendomme A/S owns the property located
in central Copenhagen where the Hempel
Foundation has its office. Hempel Ejendomme
A/S also owns the properties housing the
Hempel A/S’s headquarters and main R&D
department in Kgs. Lyngby, Denmark.
In 2023, the Hempel Foundation acquired its
first nature estate at Saksfjed on Lolland in
order to develop a Danish site for rewilding and
biodiversity. In 2025, the Hempel Foundation
also acquired an additional estate in Jutland
(Mols Laboratory). During 2025, Hempel
Ejendomme A/S acquired two additional estates
in Western Zealand (Asnæs) and Western
Jutland (Nørholm). In addition to land, both
new estates include several residential and
commercial buildings, which are rented out by
Hempel Ejendomme A/S.
All of these three new estates will be managed
and further developed into nature sites
(wilderness) alongside the existing site at
Saksfjed – together organised as “The Wilder-
ness”. Hempel Invest A/S, another 100 %-owned
subsidiary of the Hempel Foundation, holds
ownership of two forests located in Denmark
and shareholdings in a listed real estate property
company.
Alternative and impact investments
Investments in private equity and alternative
investments make up only a smal part of total
investments. These investments are illiquid in
nature and generally have a longer investment
period.
Alternatives include private equity investments,
typically through fund-of-funds structures, or as
impactful investments and impact investments
(mission-related investments). The Hempel
Foundation has made these investments through
its fully owned subsidiaries in Hempel Invest A/S
and Hempel Invest II ApS.
See our policy concerning sustainable invest-
ments on our website↗.
Hempel Foundation Annual Report 2025
Sustainability statementFoundation governance Financial performance Statements Financial statements 15PhilanthropyIntroduction Engaged ownership Financial investments
Sustainable investment policy
The Hempel Foundation’s approach to sustain-
able investments is based on the Foundation’s
core values. The Hempel Foundation and Hempel
Invest A/S aim to act responsibly in everything
we do, and we are dedicated to making a dif-
ference. This focus must be reflected in all our
investments.
The purpose of the guidelines
is to ensure that our financial
investments contribute to
sustainable and responsible
development, as well as
a high degree of social
responsibility.
� Xanthopsar flavus, a threatened bird
species in the Atlantic Forest, Paraguay.
Photo: Guillermo Menendez
Financial investments from a biodiversity
perspective
Biodiversity is one of the Hempel Foundation’s
philanthropic core focus areas. By this, we want
our investment portfolio to reflect biodiversity.
However, biodiversity is a relatively new area of
focus for investments and is therefore not as
mature as, for example, climate-related invest-
ments. Thus, we have developed a separate
policy for this area↗.
Hempel Foundation Annual Report 2025
Sustainability statementFoundation governance Financial performance Statements Financial statements 16PhilanthropyIntroduction Engaged ownership Financial investments
→ Philanthropic strategy
→ Philanthropic activities
in 2025
→ Our grantmaking
in numbers
→ Achievements within
our focus areas
Philanthropy
Students at a primary school in Tanzania participating in the
KiuFunza programme, which provides incentives to teachers to
improve foundational reading and numeracy skills in early grades.
Photo: Twaweza, Tanzania
Financial performance Statements Financial statements 17
Hempel Foundation Annual Report 2025
Foundation governance Sustainability statementPhilanthropyFinancial investmentsEngaged ownershipIntroduction
Philanthropic
strategy
We are privileged to be able to spend most of the
potential dividends from our strategic ownership
of the Hempel A/S Group, as well as from our
financial investments, on our philanthropic activ-
ities within children’s education, biodiversity and
rewilding – both internationally and in Denmark.
But this privilege comes with great responsibility.
A responsibility we are committed to honouring
through hard work and dedication to achieve the
greatest impact possible.
Internationally, we focus on improving children’s
foundational learning in least-developed
countries, sustaining biodiversity in key tropical
ecosystems, and development of sustainable
coating solutions. In Denmark, we work to accel-
erate rewilding efforts to restore biodiversity and
strengthen natural ecosystems. Additionally, we
support initiatives in Denmark and Greenland
that help children and young people in vulnerable
situations build resilience and actively engage in
their communities.
Our grantmaking is guided by an overarching
philanthropic strategy that defines the role we
aim for within our philanthropic work, the longer
term changes we strive to achieve and the
main levers that we apply to accelerate positive
change that we believe will drive positive impact.
Role
We understand our role as being a potential
catalyst for positive change, but never in isolation
from broader collective efforts, always seeking
collaborations and partnerships to achieve the
highest possible impact against pre-defined
targets within our thematic areas.
Our privileged position and responsibility come
with an obligation to constantly push ourselves
to do things better, smarter and with greater
impact to address the main challenges within
our focus areas.
Main levers of positive change
We apply three main levers of positive change
to drive impact and accelerate progress in our
thematic focus areas.
Through grants, capacity strengthening support
and bold initiatives, we aim to empower organi-
sations, inspire innovation, and amplify meaningful
actions for a better future.
By making greater use of all our capabilities we
aim to enable organisations to accelerate their
development and scaling of programmes and
approaches, creating positive changes for people
and the planet.
“Our privileged position and
responsibility come with an
obligation to constantly push
ourselves to do things better.”
← Nile River in Boma and Badingilo National Parks,
South Sudan. Photo: Marcus Westberg
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 18Introduction Engaged ownership Philanthropy
Activities
Grants
Flexible, multi-year and
risk-willing funding
Capacity strengthening
Access to network support in project
management, fundraising, communica-
tions and knowledge exchange
Bold initiatives
Demonstrate and inspire action through
initiatives of our own
How we create impact
Impact framework
To structure the tracking of
progress and reporting on
our philanthropic strategy, we
have established an impact
framework that illustrates the
main activities and outputs
that we deliver to strengthen
the organisational and financial
capacity of our partners as well
as improving the enabling con-
ditions for positive change.
We believe this will ultimately
support the longer term
positve changes we strive to
achieve.
What we aim
to achieve
The medium- and long-
term positive change we
aim to achieve through our
financial and non-financial
grantmaking support
What we do
The support we provide
to enable organisations
to accelerate their impact
Impact
Increasing children’s
foundational skills
in least-developed
countries
Sustaining tropical
forests in key
biodiversity areas
Increased use of
sustainable coating
technologies
Accelerating rewilding
to increase biodiversity
Increasing resilience
and well-being of
children and youth
Outcome
Capacity
Strengthening organisational
capacity of our partners
Finance
Increasing financial capacity
of our partners
Enabling conditions
Improving contextual conditions
supportive of positive change within
our thematic areas
International National
Education Biodiversity Social Initiatives
Coating Tech
Rewilding
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 19Introduction Engaged ownership Philanthropy
Philanthropic activities in 2025
Grants
Through the year we approved 153 grants with
a total sum of EUR 28 million, of which 60%
were granted to organisations working either in
Indonesia or countries in Africa.
We managed 250 grants supporting 166 organi-
sations across our thematic priority areas of which
a majority (120) are based in Denmark.
Three major trends characterised our grant-
making in 2025.
To further roll out our “Acceleration concept”
in Denmark, we committed multi-year grants
to Danish organisations with a strong focus on
capacity strengthening to help organisations
grow their long-term impact.
Within our international priority areas, we
strengthened our partnerships with philanthropic
collaborations and organisations working as
intermediaries in the sense that they enable us
to support local organisations through smaller
grants that we would otherwise not have the
bandwidth to manage.
The pooling of resources in philanthropic collab-
orations as well as working with intermediaries
also enables more effective allocation of funding
and a very concrete framework for closer collabo-
ration amongst foundations.
“The dramatic drop in official
development assistance that we have
seen in 2025 is expected to continue
in the coming years and, while
philanthropy cannot fill that gap,
we must do our best to maximise our
impact and I truly believe we do that
through collaboration with other
funders.” says Anders Holm,
CEO at the Hempel Foundation.
Both internationally and in Denmark we increased
our funding for knowledge and research
partners that we believe can deliver evidence
and data to support decisions by governments
and other funders in regard to prioritisation of
resources towards the most important problems
and solutions.
↑ Young biodiversity enthusiasts gathered in Saksfjed Wilderness, Denmark for an intensive bioblitz — recording
an impressive number of species in just a short time. Photo: Jens Thorving Andersen, Hempel Foundation
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 20Introduction Engaged ownership Philanthropy
Capacity strengthening
Through the year we took significant steps
on multiple fronts to deliver on our intent to
strengthen the capacity of the organisations we
work with to enable them to grow and achieve an
even greater impact. We believe this approach to
be increasingly important as it supports longer
term engagement and impact, as well as much
more resilient organisations that can withstand
local crises and turmoil.
We facilitated knowledge sharing and strength-
ening of networks among our partners, e.g. during
the SKOLL World Forum in Oxford England where
we organised an event with our education and
biodiversity partners, as well as during the IUCN
World Conservation Conference where we facili-
tated the convening of our biodiversity partners.
We enabled the provision of training to early
career conservationists and provided funding
and capacity support for community groups in
Indonesia, Madagascar and Tanzania through our
partnerships, including Maliasili and the Conser-
vation Leadership Programme.
With our partner Global Schools Forum, we
launched the Impact Accelerator Programme
which is designed to strengthen organisational
capabilities in fundraising, government engage-
ment, impact measurement, and financing.
To test the programme, a first cohort of two
Hempel Foundation Partners – Twaweza and
Teach for Bangladesh – enrolled in a 9-month
capacity building programme tailored to the
needs of the individual organisations.
92,000
hectares under increased protection
Through our partnership with WWF from 2020-2025
the Llanganates-Sangay Connectivity Corridor achieved
formal recognition as a “Special Form for Biodiversity
Conservation”.
What is an intermediary?
There is no common definition, but these
are broadly considered as “mission-driven
organisations that aim to more effectively
link donors (individuals, foundations, and
corporations) with organisations and
individuals delivering charitable services.”
(2017 Peak Grantmaking).
Examples of organisations supported in
2025 are the Critical Ecosystem Partnership
Fund (CEPF) and the Madagascar Protected
Areas and Biodiversity Fund (FAPBM).
← Local farmer in the Llanganates–Sangay Ecological
Corridor in Ecuador, where the Hempel Foundation
partnered with WWF (2020–2025) to strengthen
connectivity between two national parks protecting unique
and irreplaceable biodiversity. Photo: Esteban Barrera
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Bold initiatives
To demonstrate and inspire actions for positive
change, we initiate, co-develop and implement
new initiatives across our thematic focus areas.
While the shape and form of such initiatives
can be different, they are all characterised by a
dedicated investment of our time and resources
to help shape the initiative.
Bringing back “The Wilderness” in Denmark
In 2025, we significantly ramped up our efforts
to expand and accelerate rewilding through
the acquisition of three unique nature sites: the
Mols Laboratory, the Asnæs Peninsula, and the
Nørholm Estate.
Together with Saksfjed Wilderness, these
acquisitions form the foundation of The Wilder-
ness – an initiative designed to unite research,
education, and practical action to identify the
most effective ways to take agricultural land and
forests out of production and restore and rewild
it to allow it to return to biodiversity-rich nature.
The Wilderness signals our long-term commit-
ment to restoring nature at scale – grounded in
science, collaboration, and practical action.
Guiding nature conservation for decades to come
Together with the International Union for
Conservation of Nature (IUCN) and other
partners, we launched an initiative to undertake
a comprehensive update of the world’s Biodiver-
sity Hotspots map. This work aims to generate
detailed and up-to-date scientific data to help
prioritise funding to – and conservation action
in – the world’s most biologically unique and
threatened regions.
This work will guide nature conservation efforts
and funding for decades to come, including our
own. It will increase focus on the world’s most
threatened biodiversity. Furthermore, the Hotspots
update – and subsequent annual revisions – will
provide a framework to identify global priorities
and track impact. The Hempel Foundation will
allocate further resources to continue to drive
this initiative forward as an initiative anchored
within the Hempel Foundation.
Strengthening education for lasting impact
In response to significant reductions in global
education funding, the Hempel Foundation
committed in 2025 to a bold and innovative
philanthropic initiative: FLIGHT (Foundational
Learning Initiative for Government-led Trans-
formation). The initiative is designed to support
Sub-Saharan African countries that prioritise
foundational learning with knowledge and
resources, while strengthening national owner-
ship and leadership.
On behalf of the funder’s consortium,
Anders Holm, CEO of the Hempel Foundation,
announced FLIGHT at the ADEA Triennale
Conference in Accra, Ghana in October 2025.
↑ At the ADEA Triennale Conference in Accra, Ghana in October 2025, philanthropic funders including the
Hempel Foundation announced FLIGHT, a new initiative to strengthen government-led foundational learning
reforms in Sub-Saharan Africa. Photo: Association for the Development of Education in Africa (ADEA)
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Biodiversity
Education
Rewilding
Social Initiatives
Coating solutions
Our grantmaking in numbers
Funding by thematic areas Total
Funding by region
EURm
Total funding in EURm
Africa
Denmark
New grants approved
Asia
Global
2024 28,0
2023 23,0
2022 21,4
2021 19,6
2020 15,4
28
11,0
11,1
153
2,4
3,5
organisations supported
in 2025 across thematic
priority areas
166
8.4
EURm
8
Grants
8.5
EURm
10
Grants
4.8
EURm
12
Grants
4.3
EURm
122
Grants
2
EURm
1
Grants
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 23Introduction Engaged ownership Philanthropy
↑ Rahayu Oktaviani, 2025 Whitley Award winner, recognised for her work protecting
the endangered Javan gibbon on Java. Photo: Whitley Fund for Nature
Achievements within
our focus areas
In 2025, we worked with partners to advance
foundational learning, strengthen education sys-
tems, support governments in delivering quality
education and provided more than 600,000
children with access to quality schooling and
opportunities for a brighter future.
We also took significant strides to protect high
biodiversity landscapes, enhance financial
sustainability for conservation, and foster global
collaboration – as well as to restore wild nature
in Denmark – by combining conservation efforts
with research, engagement and knowledge sharing.
In our commitment to enhancing the well-being
of children and youth in Denmark and Green-
land, we supported more than 150 organisations
during the year. Additionally, we expanded our
acceleration programme. It now consists of three
organisations which we began supporting to
increase their impact.
Finally, CoaST continued to grow and strengthen
its network according to its strategy, expanded
its exposure facilities and took great strides
in other areas, including the advancement of
marine coating evaluation through the use of
underwater cameras and the development
of a fast-screening tool that helps identifying
promising coating formulations.
Education Biodiversity Social Initiatives
Our focus areas
Coating Technologies
The Coatings Science and Technology Centre
(CoaST) was established in 2017. The centre
supports development, production and use of
coatings with improved sustainability profiles over
the lifetime of the coating. It covers coating
technologies along the entire value chain from raw
materials, formulation, testing and characterisation
to production and application. 102 people are
involved in CoaST.
59
employees in CoaST throughout 2025;
of this number 42 are PhDs/Postdocs
Rewilding
Hempel Foundation Annual Report 2025
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Education
Spotlight
↑ During the 2025 iWitness Tour, a group of Hempel A/S colleagues travelled to
Uganda to see the Hempel Foundation’s work first-hand. Photo: Building Tomorrow
Increasing children’s
foundational skills
The challenge
Future generations in the least- developed
countries are at risk of growing up without
the ability to read or write. This undermines
social and economic growth and threat-
ens to accelerate instability in countries
challenged by multiple threats, including
climate change and loss of biodiversity.
What we do
The Hempel Foundation therefore
supports delivery of learning approaches
at country level and initiatives at
regional/global level that strengthen the
knowledge and capacity of governments
to advance policy and effectively invest in
foundational learning.
This year
2025 marked a pivotal year for global education
as international investment declined and pres-
sure on low-resource systems intensified. During
the current global learning crisis, with 70% of
children in low- and middle-income countries
unable to read or do basic mathematics, this
poses a real risk for profound loss of human
potential and future productivity.
Throughout 2025, the Foundation focused on
investing in partnerships and convenings that
enable governments in low- and lower-middle
income countries to access robust evidence and
translate it into action on foundational learning.
A core focus was strengthening government
leadership and capacity across Africa, a conti-
nent home to more than one third of the world’s
children living in learning poverty. To support this
agenda, we established new partnerships with
the Association for Development of Education
in Africa (ADEA) and Human Capital Africa
– strong, emerging actors placing data, policy
dialogue, and action for foundational learning at
the centre of their work. Equally important, we
joined the Foundational Learning Initiative for
Government-led Action (FLIGHT).
The initiative stands out for two reasons.
First, FLIGHT is government-led and Africa- driven.
It is designed to support Ministries of Education
in translating foundational learning commitments
into implementation, by providing coordinated,
flexible and evidence-based support aligned with
national priorities.
Second, FLIGHT is supported by a philanthropic
funders’ consortium, including the Gates
Foundation, Echidna Giving and the Roger
Federer Foundation amongst others. Together,
the consortium has mobilised USD 35 million
to support the initiative.
2025 also marked important milestones in existing
collaborations, such as PAL Network launching
groundbreaking multi-country data on foundational
literacy and numeracy and Global Schools Forum,
with which we launched an Impact Accelerator
programme designed to strengthen organisational
capabilities of our partners.
Hempel Foundation Annual Report 2025
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Tracking progress
on foundational
learning
In 2025, the Foundational Learning Action Tracker
(FLAT) launched its third global report in Accra,
Ghana together with the country’s Ministry of
Education.
FLAT is a partnership between the Hempel Foundation
and UNICEF, initiated in 2023 to support government
efforts to improve children’s foundational learning.
The tool provides a consistent and comparable over-
view of country progress, while offering country- level
data to inform decision-making, strengthen policy
dialogue, and help prioritise reforms where needs
are greatest.
The 2025 data shows that there is still a consider-
able need for stronger government investment in
foundational learning. Only 1 in 10 countries substan-
tially increased their overall FLAT ratings compared to
2024. Nevertheless, the data also shows encouraging
signs of improvements in areas such as a growing use
of data to inform classroom practice as well as the
increased use of evidence-based teaching strategies,
including structured pedagogy.
FIANTSO:
Roots for Learning
in Madagascar
In 2025, the Hempel Foundation initiated a new
partnership with FHI 360 in Madagascar to roll out
the FIANTSO (Fianarana Tsara Orina) project, Roots
for Learning, with the Ministry of Education and local
partners Education Network and MonEPT. FIANTSO
responds to persistently low learning outcomes by
providing intensive subject-matter training and on-
going professional development for community- hired
primary school teachers, while strengthening school
management committees to enable schools to lead
and sustain their own improvement.
↑ School visit in Accra, Ghana, during the launch of
the Foundational Learning Action Tracker 2025.
Photo: UNICEF
↑ Classroom in Atsimo Atsinanana, Madagascar, where FIANTSO,
implemented by FHI 360, strengthens teaching and school
leadership to improve foundational skills. Photo: FHI 360
↑ Launch of the Foundational Learning Action Tracker
2025 in Accra, with Hempel Foundation CEO Anders Holm
addressing the importance of accelerating progress in
foundational learning.
Photo: UNICEF
Cases
Education
Foundation governance Financial performance Statements Financial statements 26Sustainability statementPhilanthropy
Hempel Foundation Annual Report 2025
Introduction Engaged ownership Financial investments
Sustaining tropical forests
in key biodiversity areas
↑ Navigating a forest creek in Maluku, part of Indonesia’s biodiverse Wallacea region.
Photo: Rifky/Rekam Nusantara Foundation
This year
In 2025 we supported over 200 national NGOs
and community groups, and provided training
to over 300 local conservationists, through our
partnerships with organisations, such as the
Critical Ecosystem Partnership Fund (CEPF),
Maliasili, the Whitely Fund for Nature, and the
Conservation Leadership Programme, all of
which specialise in supporting local organisations
and conservationists in our priority landscapes.
We provided our time, expertise and connec-
tions to other conservation partners to exchange
knowledge. Our support to partners also cata-
lysed significant co-funding from other funders,
helping our partners to achieve even greater scale.
In 2025 we also launched a 25-year re- evaluation
of the world’s Biodiversity Hotspots – the most
recognisable concept in the history of conser-
vation. We are updating the Hotspots to include
new global datasets, to use new analytical
methodologies and technologies, and to reflect
the global biodiversity loss that has occurred over
the past 25 years. This work will be completed in
2027 and launched the same year. By combining
science and collaboration, this initiative will
provide a roadmap to guide and prioritise future
conservation efforts around the world. We will
continue to drive this initiative forward as an
initiative anchored within the Hempel Foundation.
The challenge
Biodiversity loss is occurring at an alarming
rate. We are experiencing a human-driven
mass extinction event, with an estimated
one million species threatened, yet global
funding to address the biodiversity crisis is
increasingly being cut and politicised.
What we do
To mitigate continued tropical deforestation,
we champion a landscape-scale approach
to nature conservation. We support
coalitions of partners and donors who
work with a shared strategic vision in
the Atlantic Forest Hotspot, the Eastern
Afromontane Hotspot, Madagascar and
Indonesia. We help to diversify the flow
of financing to sustain tropical forests,
and we strengthen the organisational
capacities of local partners and promote
grassroots conservation.
Biodiversity
Spotlight
Hempel Foundation Annual Report 2025
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84%
drop in deforestation since
we began supporting this
landscape
↑ Towering giants along the Avenue of the Baobabs in
Madagascar’s Dry Tropical Forest landscape.
Photo: David Emmet, Hempel Foundation.
↑ Verreaux’s sifaka, Kirindy Forest, Madagascar. Critically endangered and listed
among the World’s 25 Most Threatened Primates in 2025; the forest is managed
by CNFEREF. Photo: David Emmett, Hempel Foundation.
Reducing deforest a-
tion in threatened
ecosystems
We are working with others to reduce deforestation in
the Baobab Forests of western Madagascar – one of
the world’s most threatened ecosystems.
The tropical dry forests of western Madagascar are
one of the most threatened ecosystems on earth.
They support unique species, almost 100 of which are
globally threatened with extinction. They are home
to iconic baobab trees, a vast diversity of bird and
mammal species, and the world’s most endangered
primates such as the Madame Berthe’s mouse lemur.
Since 2023 we have been partnering with FAPBM,
which is Malagasy trust fund serving as an inno-
vative financing mechanism for protected areas of
Madagascar. Through our partnership with FAPBM,
we are supporting a coalition of organisations working
together around a shared strategy of forest manage-
ment, fire prevention and community livelihood support.
Due to the combined efforts of this partner coalition,
and with coordinated donor support, there was a record
drop in fire incidents and deforestation in 2025. In total,
deforestation has reduced by 84% since we began
supporting this landscape in 2023.
Biodiversity
Case
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 28Introduction Engaged ownership Philanthropy
Accelerating rewilding
to increase biodiversity
The Wilderness strengthens both the evidence
base for rewilding and the capacity to translate
knowledge into action. The initiative reflects
the Foundation’s ambition to accelerate impact
by building platforms that can drive long-term
positive change at scale.
Initiatives launched
○ Research: New research collaborations with
the University of Copenhagen and Aarhus
University to ensure that The Wilderness
develops based on new knowledge and
contributes to research and best practice in
nature restoration.
○ Education: Strengthened field-based biology
teaching, providing future biologists and
nature managers with hands-on experience
in wilderness areas.
○ School partnerships: Nationwide access
for Danish schools to visit wilderness areas,
supported by free teaching materials and
learning programmes focused on nature and
rewilding.
○ Rewilding Festival: Hosting the first
European Rewilding Festival in Denmark in
2026, in partnership with Rewilding Europe,
bringing together rewilding initiatives from
across Europe.
○ Youth engagement: Support for the National
Youth Green Summit at the Mols Laboratory
in 2026.
○ Networking: Establishment of a Danish
rewilding network, with a physical base at the
Mols Laboratory, to facilitate collaboration and
accelerate nature restoration efforts.
○ International conference: Hosting the 3
rd
International Rewilding Conference in Denmark
in 2027, in partnership with Citizen Zoo.
○ Communication: Launch of thewilderness.dk
as a national knowledge platform on rewilding
and biodiversity, alongside an international
communication partnership to highlight
rewilding results across Europe.
○ Evidence: Convening leading researchers to
assess existing evidence on effective nature
restoration and identify priorities for further
research and practical experimentation.
This year
In 2025, the Hempel Foundation significantly
expanded our efforts to accelerate nature
restoration in Denmark with the scaling of
The Wilderness – with a vision to become a hub
for rewilding. Building on our work in Saksfjed
Wilderness, the Foundation acquired three new
nature areas: the Mols Laboratory, the Asnæs
Peninsula and the Nørholm Estate. Together,
the four wilderness areas now cover nearly
2,500 hectares.
The Wilderness is designed as a platform
where research, education and practical action
are brought together to identify, test and scale
effective approaches to restoring biodiversity on
land taken out of production. Through collab-
oration with Danish and international partners,
the initiative aims to generate new knowledge,
develop best practice and contribute to more
effective nature restoration efforts in Denmark
and potentially across Europe.
By linking large, contiguous nature areas with
science, learning and public engagement,
The challenge
Denmark has the lowest proportion of land
under conservation in Europe and there is
an urgent need for more wild nature in the
form of very large contiguous natural areas.
What we do
The Hempel Foundation demonstrates
how rewilding can be carried out in
Denmark by investment and develop-
ment of land in close collaboration with
scientists, researchers, youth and other
change makers to increase awareness and
action to promote rewilding.
Biodiversity Spotlight
Rewilding
Hempel Foundation Annual Report 2025
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←
Tauros arrived in
Denmark to help
restore nature and
boost biodiversity
The arrival of Tauros in 2025 marked a milestone for
our rewilding efforts in Denmark – and underlined our
long-term commitment to nature restoration.
For the first time in Northern Europe, 30 tauros –
modern-day descendants of the extinct aurochs
– were released into the wild at Saksfjed Wilderness,
owned and managed by the Hempel Foundation.
As a keystone species, tauros help shape dynamic
landscapes through grazing, trampling, and natural
disturbance, creating open habitats that many plants,
insects, birds, and fungi depend on.
↑ Tauros foraging in Saksfjed Wilderness, helping restore
natural processes and strengthen biodiversity.
Photo: Frederik Josefsen
↑ Resembling the extinct auroch, 30 Tauros have been introduced to Denmark
for the first time, helping restore the natural role once played by large herbivores.
Photo: Mads Hagen
The release is part of the Tauros Programme
and was coordinated by Grazelands
Rewilding in partnership with Rewilding
Europe’s Natural Grazing Facility, which
carefully combines breeds to recreate
a functional, wild-living bovine. In the
years ahead, monitoring, learning, and
research will continue, in collaboration with
Aarhus University.
CaseBiodiversity
Rewilding
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 30Introduction Engaged ownership Philanthropy
This year
Main achievements during 2025 include the
expansion of The Hempel Foundation Coat-
ings Science and Technology Centre (CoaST)
Exposure Facilities with a new house and steel
racks for panels that enable extensive long-term
studies of anti-corrosive coating systems under
authentic maritime exposure conditions. The
expansion will also handle an expected increase
in the number of experimental formulations as
well as a broad spectrum of reference systems
defined in associated PhD projects.
Another highlight was the successful automa-
tion of the existing methodology and system
for making fouling assessments under water.
Results achieved mean that fouling assessments
have been expanded to estimate barnacle heights
from 2D images, which significantly advances
the quality of marine coating evaluation.
Finally, use of a new screening method through
2025 confirmed its reliability in correlating
results from different types of lab-scale test
furnaces and, for some coating types, even
Sustainable coating technologies
The challenge
Coatings are key for the protection and
effectiveness of large infrastructure and
critical for economic growth. Given their
wide usage, more sustainable and carbon
neutral coatings can help mitigate climate
change on a significant scale.
What we do
Through its commitment to sustainable
practices and minimising environmental
impact, CoaST at DTU, The Technical
University of Denmark, actively contributes
to mitigating climate change, addressing
resource scarcity, and combating environ-
mental degradation.
43 25
17 5
individual student
projects
peer reviewed journal
publications
conference
publications
inventions submitted
for patent
predicting the full-scale test performance with a
satisfactory certainty. The test method provides
a fast-screening tool supporting identification of
promising coating formulations.
CoaST highlights
Coating Technologies
Spotlight
Hempel Foundation Annual Report 2025
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Increasing resilience
and well-being of children
and youth
↑ Community day in Knuthenborg Safaripark with the organisation Børnehjælpsdagen,
one of Denmark’s oldest humanitarian organisations. Photo: Børnehjælpsdagen
This year
In 2025, our support focused on strengthening
the well-being and rights of children, young
people and adults in vulnerable situations,
and their ability to take part in society, across
Denmark, Greenland and beyond.
This work is guided by a clear premise: well-
being and rights depend on access – to safe
communities, supportive relationships and
meaningful opportunities to take part in society.
○ 27 grants supporting counselling services,
camps, community activities, networks
and safe meeting places for children and
young people.
○ 91 grants awarded through the Søsat open
call, supporting local water sports clubs in
providing fun, inclusive and meaningful activi-
ties for children and young people nationwide.
○ 3 acceleration partnerships, where we work
more closely with selected organisations to
strengthen organisational capacity, leadership
and long-term sustainability.
The challenge
The well-being and mental health among
children and youth in Denmark and Green-
land is close to our hearts, especially with
rising cases of anxiety, depression, and
emotional distress significantly impacting
overall development and quality of life of
children.
What we do
To address this the Hempel Foundation
supports organisations dedicated to
enhancing the resilience and well-being
of children and youth in Denmark and
Greenland.
Social Initiatives
Spotlight
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements Financial statements 32Introduction Engaged ownership Philanthropy
In 2025, the partnership with Headspace
Denmark in Lolland and Guldborgsund was
concluded. It began with a start-up grant and
three years of operational funding to establish
two local, low-threshold and anonymous centres
for young people – a type of support that is
otherwise scarce in the area.
Many young people need someone to talk
to before problems grow bigger. Headspace
offers a place where young people can drop in
without referrals and speak openly about what
is on their mind, whether big or small, in a safe
and anonymous setting. The conversations take
place on the young person’s terms and without
requirements.
For some, it is the first time they talk to someone
about what they are struggling with. For others,
it becomes a first step towards further help.
In this way, Headspace plays a clear bridging
role, helping young people find their way to other
services when additional support is needed.
Today, both Headspace Denmark centres are
well established locally, supported by a growing
group of trained volunteer counsellors. The
municipalities have taken over responsibility for
operations, ensuring continued mental health
support for young people in the area.
Given its proven effectiveness, the model will be
continued. In 2025, additional funds were com-
mitted to support the establishment and initial
operation of a new Headspace centre in an area
with documented need. The support follows
a time-limited, three-year co-funding model,
designed to pave the way for local ownership
from the outset.
Headspace a scalable model ensuring
access to mental health support for young
people
↑ Photo: Headspace, Guldborgsund
Case
Social Initiatives
Many young people need someone
to talk to. Headspace offers a place
where young people can drop in.
Hempel Foundation Annual Report 2025
33Financial investments Statements Financial statementsIntroduction Engaged ownership Sustainability statementFoundation governance Financial performanceIntroduction Engaged ownership Financial investments Philanthropy
→ Governance structure
and composition
→ Board structure
→ Board committees
→ Operational aspects
of governance
Foundation
governance
Stunning landscape in South Sudan.
Photo: African Parks
Financial investments Sustainability statementFinancial performance Statements Financial statements 34PhilanthropyIntroduction Engaged ownership Foundation governance
Hempel Foundation Annual Report 2025
Governance structure
and composition
← The Asnæs Peninsula in Denmark – one of the
new areas now incorporated into The Wilderness.
Photo: Lars Hestbæk
The Foundation Charter defines the overall
principles for the Hempel Foundation’s activities.
In addition, the Foundation is governed by a
set of Rules of Procedure for Board work and
an Annual Wheel to plan and prioritise our work
during the year.
Based on these governance frameworks,
the Board of Directors considers the Hempel
Foundation to be in full compliance with the
legislation and to comply with all recommen-
dations from the Danish Committee for Good
Governance in commercial foundations.
The Board of Directors and the secretariat
keep a close watch on the continued effort to
ensure a high degree of transparency in results
and procedures covering all aspects of the
Foundation’s scope that are not sensitive to the
business activities of the Hempel A/S Group.
Regarding the recommendations from the
Danish Committee for Good Governance in
commercial foundations, the Board of Directors
has made a full report, which is available at
our website ↗
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFinancial performance Statements Financial statements 35PhilanthropyIntroduction Engaged ownership Foundation governance
Board structure
Board of Directors
The Hempel Foundation is governed by a Board
of Directors comprising nine members, of whom
six members are elected by the Foundation and
three members elected internally by employees
of the Hempel A/S Group.
The Foundation Charter states that the Board of
Directors is a self-electing entity. Elections take
place annually. Board members appointed by the
Foundation are elected for a three-year term and
may be re-elected.
The term of office is stipulated in the Foundation
Charter, with a view to maintaining satisfactory
continuity in the Board’s activities. The Chair and
Deputy Chair are elected from among the Board
members.
Board members must be no more than 65
years of age when elected for the first time.
The age limit for Board members elected by the
Foundation is 75 years. The members appointed
by employees are elected under Danish legisla-
tive provisions for employee representation on
boards of directors and, accordingly, are elected
for a term of four years.
Under the Foundation Charter, the following
requirements apply to members of the Board
of Directors appointed by the Foundation:
○ A majority cannot at the same time be mem-
bers of the Hempel A/S Board of Directors.
○ A majority should preferably be current or
former Hempel employees or somehow be
or have been involved with Hempel A/S over
many years.
○ At least two of the members must have
international business experience.
The Board of Directors has additionally set a
target for gender split among members elected
by the Foundation. The declared target is that a
minimum of two of the Board members appointed
by the Foundation must be the underrepresented
gender.
This target was achieved in 2018 and maintained
in 2025.
The Board of Directors has also decided that
competencies within charitable donations, com-
mercial business, active ownership, sustainability,
financial investments and other important areas
should be present among members of the Board.
Competence requirements are reviewed every
year and were fully adhered to in 2025.
The Chair and the Deputy Chair of the Board
monitor and assess the composition of the Board
and its performance on an ongoing basis, in
consultation with individual Board members and
the Board as a whole.
Once a year, the Board performs a formalised
internal Board evaluation and gap analysis in
accordance with the detailed recommendations
from the Danish Committee for Good Governance
in commercial foundations. This evaluation aims
to ensure that the required commercial, investment
and personal skills, as well as competencies
regarding charitable donations, are available
among the Board members appointed by the
Foundation. Also, once a year the Board performs
a formalised Board Evaluation of the Chair’s
performance.
Detailed information on the Board of Directors
can be found at our website ↗
All new Board members appointed by the
Foundation are selected through a structured
process based on the above evaluation, as well
as any specific needs for additional competencies
on the Board.
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFinancial performance Statements Financial statements 36PhilanthropyIntroduction Engaged ownership Foundation governance
↑ Aerial view of Lungholm Lake and surrounding autumn landscape at Saksfjed, Denmark.
Photo: Jens Thorving Andersen, Hempel Foundation
Board committees
The Hempel Foundation Board of Directors has
established permanent Board committees to
support its work. These include an Investment
Committee and a Donations Committee, and in
2025 an Audit Committee was established to
further strengthen the financial governance of
the Hempel Foundation Group. For preparation of
specific purposes, the Board of Directors can
decide to establish ad hoc committees, which
are dissolved when the specific tasks are
completed.
Investment Committee
The Foundation has elected an Investment
Committee made up of Board members to prepare
the Board’s higher-level decisions regarding
the Foundation’s financial investments and to
evaluate professional external portfolio managers
used by the Foundation.
The final decision on investments is made by
all Board members. The Board continuously
oversees and ensures that the Foundation’s
financial investments and asset management are
in alignment with the Foundation’s purpose and
its investment strategy.
Audit Committee
During 2025 the Foundation established and
elected an Audit Committee made up of Board
members to prepare the Board’s higher-level
decisions regarding accounting, reporting and
financial matters as well as interaction with the
auditors. The final decision on accounting
matters is made by all Board members.
The Board continuously oversees and ensures
that the Foundation’s accounting and reporting
are in alignment with the Foundation’s purpose
and its investment strategy.
Donations Committee
The Foundation has elected a Donations
Committee, which examines and evaluates the
applications the Foundation receives, many of
which are for significant and complex projects.
The final decisions on donations are, in
accordance with an agreement made within the
Board, made by all Board members and not only
by the members of the Donations Committee
(ref. Commercial Foundations Act section 64).
The final decision on the total annual donations
is also taken by all Board members.
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFinancial performance Statements Financial statements 37PhilanthropyIntroduction Engaged ownership Foundation governance
Operational aspects of governance
Spokespersons
The Chair of the Board speaks on behalf of the
Hempel Foundation, unless the Chair, after a
concrete assessment, appoints the Foundation’s
CEO to do so.
Meetings and remuneration
Members of the Board of Directors receive a
fixed annual base fee, which is on a market level
and considered reasonable in relation to the
workload, nature of the job and competencies
required.
As is customary, the Chair receives 3 times the
base fee and Deputy Chair 1.5 times the base fee.
Besides the Chair, members of the Investment
Committee, Donations Committee and the
Audit Committee receive a separate fixed annual
fee for committee work. Remuneration is bench-
marked in an external, independent analysis that
is conducted regularly.
The Hempel Foundation is fully transparent
about remuneration across the Board and executive
management as reflected on our website ↗.
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFinancial performance Statements Financial statements 38PhilanthropyIntroduction Engaged ownership Foundation governance
Meeting activity 2025
Attended meeting Absent from meeting
Name Title Board of Directors Investment Committee Donations Committee Audit Committee
Richard Sand Chair
Leif Jensen Deputy Chair
Lars Aaen Board member
Kim Dam-Johansen Board member
Birgitte Hagemann-Snabe Board member
Sisse Fjelsted Rasmussen Board member
Tine Gundersen Elected by the employees
Lone Borre Elected by the employees
Claus Juul-Petersen Elected by the employees
Sara Bennicke Vollmond Elected by the employees
Board of Directors Investment Committee Donations Committee Audit Committee
3 March 26 February 25 February 23 June
21 May 1 May 1 May 19 November
24 June 18 June 23 June
3 October 25 September 17 September
9 December 2 December 19 November
Conflicts of interest
The Foundation is committed to ensuring
that all persons involved in its investment and
donation processes possess the requisite skills.
The Foundation is committed to avoiding
any potential conflict of interest to ensure the
integrity of decisions made regarding investment
proposals and donation applications.
All decisions are made in accordance with
common conflict of interest principles. In practice
this means that no Board member or Foundation
employee can take part in any decisions in which
they may be deemed to have a material personal
interest.
↑ Voluntary Service Overseas (VSO) harnesses the power of volunteers to improve education
systems in low-income countries, as in here in Nepal. Photo: VSO
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFinancial performance Statements Financial statements 39PhilanthropyIntroduction Engaged ownership Foundation governance
→ Consolidated financial
results for the Hempel
Foundation Group
→ Hempel Foundation’s
financial results
Financial
performance
Common Crane in Saksfjed Wilderness.
Photo: Jens Thorvinge Andersen, Hempel Foundation
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Statements Financial statements 40PhilanthropyIntroduction Engaged ownership Financial performance
Consolidated financial results
for the Hempel Foundation Group
Revenue, organic growth and earnings
Total revenue in 2025 reached EUR 2,169
million, which constitutes a decrease of EUR 16
million compared to 2024. The revenue was
impacted but unfavourble currency development,
mainly in the USD. The organic growth for the
year landed at 3.4 %. Organic growth fell slightly
short of the expectation for the year, due to softer
market conditions.
Revenue was mainly driven by the Marine
segment. The Energy & Infrastructure segment
remained the largest segment and showed stable
revenue compared to 2024. The Decorative
segment delivered revenue growth of 0.6%,
with commercial tailwinds for some brands in
certain markets countered by headwinds in other
regions.
The Marine segment delivered strong growth of
9.8 %, reporting revenue for the year of EUR 750
million. This represents the strongest year ever
for Marine sales, achieving double-digit volume
growth in both the drydock and newbuild seg-
ments, surpassing previous records set in 2023.
The Energy & Infrastructure segment delivered
slight growth of 0.1 %, ending the year with rev-
enue of EUR 775 million. Revenue was secured
by successfully winning more volume across the
globe, with a focus on Hempel A/S’s leading
technologies.
The Decorative segment achieved 0.6 % organic
growth, with revenue amounting to EUR 640 million.
This growth was delivered both by increases in
the luxury segment through Farrow & Ball and in
the UK mid-market through Crown Paints.
Gross profit and margin
Gross profit increased in 2025 by EUR 11 million,
up from EUR 948 million in 2024 to EUR 959
million in 2025.
The positive development was driven by reduced
raw material costs as well as operational efficien-
cies, mainly in China. This was countered by im-
pacts from unfavourable currency development
of the USD denominated revenue.
Sales, distribution and administrative costs
Sales, distribution and administrative costs
amounted to EUR 690 million in 2025, EUR 18
million higher than 2024. The increase reflects
general price inflation and investments in digital
solutions aimed at driving scalable operations.
The result includes one-off restructuring costs of
EUR 7 million. These initiatives are aligned with
the Hempel A/S Group’s strategic ambition to
improve competitiveness.
EBITDA and EBITDA margin
Adjusted EBITDA of EUR 392 million was
delivered in 2025, on par with 2024. With a
slightly contracting revenue, this had a positive
impact on the adjusted EBITDA margin, which
continued the improvements YoY and now
reached 18.1% (2024: 17.9%). This was the
result of flowthrough from the improvement in
gross profit and disciplined cost control across
sales, distribution and administrative costs. The
reported EBITDA margin exceeded the full-year
expectation.
Financial items and foreign exchange
Financial items (net) amounted to negative
EUR 50 million, which comprise a negative
increase of EUR 18 million compared to 2024
(EUR -32 million). This decrease was mainly
driven by higher foreign exchange losses.
Tax and net profit
Tax for 2025 amounted to EUR 47 million,
compared to EUR 50 million in 2024, resulting in
an effective tax rate of 22.1%, up by 1.8%-points
from 20.3% in 2024. Net profit for the year
amounted to EUR 185 million compared to
EUR 107 million in 2024. Where the latter
was significantly impacted by a loss related
to discontinued operations.
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Statements Financial statements 41PhilanthropyIntroduction Engaged ownership Financial performance
Financial position and cash flow
Total assets
Total assets ended the year at EUR 3,023 million,
which is a decrease of EUR 213 million from
EUR 3,236 million on 31 December 2024.
Non-current assets amounted to EUR 2,008
million in 2025, a decrease of EUR 105 million
from 2024.
Current assets amounted to EUR 1,015 million in
2025, a decrease of EUR 108 million from 2024.
The decrease was driven by lower inventories
and cash.
Cash flows from operating activities
Cash flows from operating activities amounted
to EUR 324 million in 2025, up from EUR 239
million in 2024. The higher cash flow from
operating activities was mainly driven by lower
inventory levels and less interest paid.
Subsequent events
After the balance sheet date, Hempel
Ejendomme A/S acquired two nature
sites to further expand our work within
nature restoration in Denmark: Nørholm
Gods and the Mols Laboratory. These
acquisitions are not expected to materially
impact the financial result of the Hempel
Foundation Group.
No other events occurred after the balance
sheet date that could have a material
impact on the company’s financial results,
assets, liabilities or equity.
Cash flows from investing activities
Cash outflows from investing activities amounted
to negative EUR 39 million in 2025, compared
to negative EUR 283 million in 2024.
When evaluating tangible investments (property,
plant and equipment) there was no noticeable
shift from 2024.
Free cash flow
Free cash flow was significantly improved in
2025 and landed on EUR 285 million compared
to a negative free cash flow in 2024 of EUR 44
million.
Cash flows from financing activities
Cash flows from financing activities totalled
negative EUR 316 million, which was a decrease
of EUR 368 million (positive EUR 52 million in
2024). The shift was mainly related to issues
around equity in 2024 as well as changes in
borrowing.
← European green toad (Bufotes viridis), a rare and
critically endangered species in Denmark, photographed
in Saksfjed Wilderness, where the Hempel Foundation is
working to restore nature. Photo: Hempel Foundation
2026 outlook
In 2026, the Hempel Foundation Group will
continue our journey to grow the Hempel A/S
Group and consolidate the financial solidity of
the Hempel Foundation Group in general.
The Hempel A/S Group expects to see low
single- digit organic revenue growth and an
EBITDA margin around 18 %.
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Statements Financial statements 42PhilanthropyIntroduction Engaged ownership Financial performance
Hempel Foundation’s
financial results
Financial result of Hempel Foundation
Net financial income amounted to EUR 19 million
in 2025 compared to EUR 21 million in 2024.
The development can be explained by a slightly
lower return from financial investments including
currency impacts.
The Hempel Foundation’s net profit before tax
was EUR 88 million in 2025 compared to EUR
15 million in 2024.
Investments
Investments in subsidiaries decreased during
the year and amounted to EUR 984 million as
of 31 December 2025 compared to EUR 999
million as of 31 December 2024. The decrease
is primarily due to dividend distribution and FX
impact in subsidiaries, partly offset by a positive
2025 result from investments in subsidiaries.
Other investments increased from EUR 199
million in 2024 to EUR 255 million as of 31
December 2025, primarily due to increased
investments during the year as well as positive
revaluations of investments.
Total assets
Total assets for the Hempel Foundation also
remained stable and amounted to EUR 1,268
million as of 31 December 2025 compared to
EUR 1,222 million as of 31 December 2024.
Outlook
TheHempel Foundation (parent and associated
activities) expects a result, when excluding
financial investments, at the same level as in 2025.
↑ Photo: Hempel A/S
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Statements Financial statements 43PhilanthropyIntroduction Engaged ownership Financial performance
Sustainability
statement
* In accordance with section 99a of the Danish Financial
Statements Act
The varied Ice Age landscape at Mols Laboratory.
Photo: Jens Thorving Andersen, Hempel Foundation.
→ Statutory statement
on sustainability*
→ Our business model
Financial investments Foundation governance Financial performance Statements Financial statements 44PhilanthropyIntroduction Engaged ownership Sustainability statement
Hempel Foundation Annual Report 2025
As the majority owner of the Hempel A/S Group
and a philanthropic foundation committed to
achieving the highest possible social and environ-
mental impact – sustainability is a fundamental
strategic priority guiding all our decision making.
Through our grantmaking in education, social
well-being and biodiversity, we are striving to
improve the social and economic situation for
children and adults through access to better
learning, sustainable income opportunities and
ecosystem services provided by key biodiversity
areas.
As the majority owner of the Hempel A/S Group,
our main sustainability priority is to support the
company’s actions to reduce its environmental
footprint. The Hempel A/S Group has in 2025
prepared an integrated annual report with
elements from the Corporate Sustainability
Reporting Directive (CSRD) framework.
While the EU has approved a two-year deferral,
the Hempel A/S Group is committed to advancing
its ESG disclosures in line with the CSRD and
stakeholder expectations.
In this statement the Hempel Foundation provides
a resume of the sustainability work within the
Foundation and the Hempel A/S Group for
2025. For further elaboration and detail regarding
the Hempel A/S Group, reference is made to the
2025 Hempel A/S Annual Report.
The Hempel Foundation’s operational activities
represent a minor part of the consolidated
sustainability impacts and efforts of the Hempel
Foundation Group, however, a common policy for
sustainable behaviour in the Foundation’s daily
practice was developed in 2022. The Sustainability
Policy is available on our website ↗
In addition, the boards of the Hempel Foundation
and Hempel Invest A/S have adopted a policy for
sustainable investments.
Statutory statement on sustainability*
* In accordance with section 99a of
the Danish Financial Statements Act
Hempel Foundation Annual Report 2025
Financial investments Foundation governance Financial performance Statements Financial statements 45PhilanthropyIntroduction Engaged ownership Sustainability statement
↑ Photo: Hempel A/S
Within the Hempel Foundation, our grantmaking
is guided by a philanthropic strategy outlining
our priorities and approach (see the Philanthropy
chapter). The Hempel A/S Group’s continued
growth and development is driven forward based
on a business model with sustainability at its core.
By fostering safety, fair labour practices, diversity
and inclusion, the Hempel A/S Group aspires
to drive positive change and raise industry
standards. The Group has a strong focus on
achieving diversity, including gender balance in
its workforce, and reducing hazardous materials
that are harmful to people and the environment.
Our business model
The Hempel A/S Group is committed to
developing a diverse and inclusive culture
where employees feel safe and respected, and
are treated fairly. We believe that ensuring equal
rights and promoting diversity will benefit all
employees around the world, fostering
collaboration, innovation and better business
performance. See more about these commitments
in the Hempel A/S’s Annual Report in
the Sustainability statements↗.
Hempel Foundation Annual Report 2025
Financial investments Foundation governance Financial performance Statements Financial statements 46PhilanthropyIntroduction Engaged ownership Sustainability statement
Across the world, Hempel A/S’ products and solutions help customers protect, inspire and improve
performance of their most valuable assets. Sustainability is at the heart of the business and incorporated
into every step of the company’s business model. For further detail and specific impacts of Hempel A/S’s
business model, please refer to the Sustainability Statement in the 2025 Hempel A/S Annual Report.
Hempel A/S business model
Input Value
Customers
Hempel A/S continuously engages
with customers to understand and
meet their evolving business.
Stakeholders
Hempel A/S builds trusted
relationships with consumers,
suppliers, peers, and other
stakeholders across the value chain.
Hempel A/S gains insights to
continue to cater to consumer
lifestyles and needs.
Employees
Hempel A/S’ organisation of +7,200
colleagues is driven by a purpose and
ambition to make a positive difference
for customers and society. Hempel
A/S relies on their input and
expertise to reach its goals.
Procurement of resources
Hempel A/S depends on raw
materials, such as epoxy, titanium
dioxide and metallic pigments, to
produce its solutions.
Customers & consumers
Hempel A/S delivers solutions and
services that build value propositions
for customers, while helping them
reduce their environmental impact.
Hempel A/S also delivers inspiring
products to consumers that beautify
their living spaces.
Employees
Hempel A/S nurtures a diverse and
inclusive workplace with a shared
culture, where employees can
succeed and develop.
The world around Hempel A/S
Hempel A/S’ solutions extend the
lifetime of customers’ assets and
enable them to operate with higher
efficiency. Hempel A/S also
continuously works to reduce the
impact of its own operations.
Company & owners
Hempel A/S is owned by the
Hempel Foundation and CVC Funds.
As majority owner, the Hempel
Foundation supports philanthropic
projects around the world.
Research & develop
Hempel A/S continuously develops
expertise across segments to deliver
best-in-class solutions from chemistry
to application engineering. Hempel
A/S actively partners with its
customers and partners in the field.
Innovate
Hempel A/S is committed to
innovating with its customers to
enable them to meet their goals,
using state-of-the-art processes
across its 13 R&D centres.
Produce & scale
Hempel A/S strives for greater
excellence, efficiency and scalability
in production while reducing the
environmental footprint of its
operations.
Collaborate
Hempel A/S collaborates with
suppliers to shorten lead times and
drive joint decarbonisation efforts.
Research & development Production
Brand & sell
Hempel A/S works with customers to
communicate the value and benefits of its
brands and solutions, ensuring the best
possible experience, regardless of how or
where customers engage.
Distribute
Hempel A/S’ globally integrated supply
chain and store network enable delivery of
solutions to customers across the world
every day.
Advise & support
Hempel A/S’ global coating advisors
ensure efficient, high-quality application
and process optimisation to maintain
customers’ assets in the agreed condition.
This helps reduce costs and waste and
improve performance. In paint stores,
Hempel A/S provides advice and inspiration
to both private and professional consumers.
Delivery, sale and support
Hempel A/S’ business
Hempel Foundation Annual Report 2025
Financial investments Foundation governance Financial performance Statements Financial statements 47PhilanthropyIntroduction Engaged ownership Sustainability statement
→ Management’s statement
→ Independent auditor’s report
Statements
Wild nature is evolving in Saksfjed Wilderness.
Photo: Jens Thorving Andersen, Hempel Foundation
Financial investments Sustainability statementFoundation governance Financial performance Financial statements 48PhilanthropyIntroduction Engaged ownership Statements
Hempel Foundation Annual Report 2025
Board of DirectorsManagement
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Financial statements 49PhilanthropyIntroduction Engaged ownership Statements
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Financial statements 50PhilanthropyIntroduction Engaged ownership Statements
CVR No 33 77 12 31
mne34354
mne35412
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Financial statements 51PhilanthropyIntroduction Engaged ownership Statements
Consolidated financial statements
Notes
1. Basis of preparation
1.1 General accounting policies
. . . . . . . . . . . . . . . . . . . . . . . . . . 58
1.2 Significant accounting estimates and judgements
. . . . . . 61
2. Results for the year
2.1 Revenue
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
2.2 Employee costs
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
2.3 Other operating income and expenses
. . . . . . . . . . . . . . . . 66
2.4 Special items
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
2.5 Income tax, tax assets and liabilities
. . . . . . . . . . . . . . . . . . . 67
3. Operating assets and liabilities
3.1 Intangible assets
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
3.2 Property, plant and equipment
. . . . . . . . . . . . . . . . . . . . . . . 74
3.3 Leases
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
3.4 Inventories
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
3.5 Trade receivables
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
3.6 Pensions and other post-employment
benefit obligations
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
3.7 Provisions
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
3.8 Other liabilities
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
4. Capital structure and financing items
4.1 Base capital and grants
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
4.2 Borrowings
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
4.3 Financial risks
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
4.4 Financial instruments
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
4.5 Financial income and expenses
. . . . . . . . . . . . . . . . . . . . . . . 91
4.6 Discontinued operations
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
5. Other disclosures
5.1 Fee to the auditors appointed at the General Meeting
. . . 93
5.2 Adjustment for non-cash items
. . . . . . . . . . . . . . . . . . . . . . . 93
5.3 Contingent liabilities and other commitments
. . . . . . . . . . 93
5.4 Events after the reporting period
. . . . . . . . . . . . . . . . . . . . . . 94
5.5 Related parties
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
5.6 The Hempel Foundation Group
. . . . . . . . . . . . . . . . . . . . . . . 95
5.7 Financial definitions
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
Primary statements
Consolidated statement of profit and loss . . . . . . . . . . . . . . . 54
Consolidated statement of comprehensive income
. . . . . . . 54
Consolidated statement of financial position
. . . . . . . . . . . . . 55
Consolidated statement of changes in equity
. . . . . . . . . . . . 56
Consolidated cash flow statement
. . . . . . . . . . . . . . . . . . . . . . 57
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Financial investments Sustainability statementFoundation governance Financial performance Statements 53PhilanthropyIntroduction Engaged ownership Financial statements
Consolidated
financial statements
Consolidated statement of profit and loss Consolidated statement of comprehensive income
Note (EUR m) 2025 2024
2.1 Revenue 2,169 2,185
Production costs - 1,210 - 1,237
Gross profit 959 948
Sales and distribution costs - 521 - 502
Administrative costs - 169 - 170
2.3 Other operating income 12 3
2.3 Other operating expenses -1 -
Operating profit 280 279
4.5 Financial income 63 74
4.5 Financial expenses - 113 - 106
Profit before tax 230 247
2.5 Income tax - 47 - 50
Net profit for the year from continuing operations 183 197
4.6 Net profit for the year from discontinued operations 2 - 90
Net profit for the year 185 107
Attributable to:
Equity holders of the Hempel Foundation 135 78
Non-controlling interests 50 29
Net profit for the year 185 107
Note (EUR m) 2025 2024
Net profit for the year 185 107
Other comprehensive income:
Items that may be reclassified to profit or loss
Exchange rate differences on translation of foreign operations and hyperinflation - 78 57
Value adjustment of hedges 2 3
2.5 Tax on other comprehensive income 6 - 6
Items that will not be reclassified to profit or loss
3.6 Remeasurements of defined benefit pension obligations 1 2
2.5 Tax on other comprehensive income - -
Other comprehensive income of the year, net of tax - 69 56
Total comprehensive income for the year 116 163
Attributable to:
The Hempel Foundation 88 131
Non-controlling interests 28 32
Total comprehensive income for the year 116 163
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements 54PhilanthropyIntroduction Engaged ownership Financial statements
Consolidated
financial statements
Consolidated statement of financial position
Note (EUR m) 2025 2024
3.1 Intangible assets 743 793
3.2 Property, plant and equipment 557 594
3.3 Right-of-use assets 81 92
4.4 Other financial assets 495 507
3.6 Defined benetfit pension plan surpluses 5 4
2.5 Deferred tax assets 127 123
Total non-current assets 2,008 2,113
3.4 Inventories 277 336
3.5 Trade receivables 442 450
Income tax receivables 31 23
Prepayments 23 20
Other receivables 62 65
Cash 180 229
Total current assets 1,015 1,123
Total assets 3,023 3,236
Note (EUR m) 2025 2024
4.1 Share capital / Capital base 5 5
Translation reserve - 36 28
Cash flow hedge - - 2
Warrants 6 -
Reserve for future grants 40 40
Retained earnings 1,408 1,292
Equity belonging to the Hempel Foundation 1,423 1,363
Non-controlling interests 311 303
Total equity 1,734 1,666
4.2 Borrowings 384 582
3.3 Lease liabilities 60 67
3.7 Provisions 47 55
3.6 Pension and similar obligations 20 22
2.5 Deferred tax liabilities 62 70
Total non-current liabilities 573 796
4.2 Borrowings 43 76
3.3 Lease liabilities 24 29
Trade payables 305 316
Deferred income 6 7
3.7 Provisions 23 16
Income tax payables 34 44
3.8 Other liabilities 281 286
Total current liabilities 716 774
Total liabilities 1,289 1,570
Total equity and liabilities 3,023 3,236
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Consolidated
financial statements
Consolidated statement of changes in equity
Note (EUR m) Capital
base
Retained
earnings
Warrants Reserve for
future grants
Translation
reserve
Cash flow
hedges
Total other
comprehensive
income
Minority
interests
Total equity
2025
Balance at beginning of the year 5 1,292 - 40 28 - 2 26 303 1,666
Net profit - 107 - 28 - - - 50 185
Other comprehensive income - 15 - - - 64 2 - 62 - 22 - 69
Total comprehensive income - 122 - 28 - 64 2 - 62 28 116
Capital contribution - - - - - - - - -
Transaction with minority interests
1
Dividends - - - - - - - - 20 - 20
Grants, net - - - - 28 - - - - - 28
Other adjustments - - 6 6 - - - - - -
4.1 Balance at the end of the year 5 1,408 6 40 - 36 - - 36 311 1,734
2024
Balance at beginning of the year 5 881 - 30 - 24 - 4 - 28 57 945
Net profit - 41 - 37 - - - 29 107
Other comprehensive income - -1 - - 52 2 54 3 56
Total comprehensive income - 40 - 37 52 2 54 32 163
Capital contribution - - - - - - - 600 600
Transaction with minority interests
1
Dividends - - - - - - - - 13 - 13
Grants, net - - - - 27 - - - - - 27
Other adjustments - - 2 - - - - - - - 2
4.1 Balance at the end of the year 5 1,292 - 40 28 -2 26 303 1,666
1
Difference between proceeds and carrying amount of the non-controlling interests’ proportion of the net asset for interests sold.
Hempel Foundation Annual Report 2025
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Consolidated
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Consolidated cash flow statement
Note (EUR m) 2025 2024
Cash flows from financing and grantmaking activities
4.4 Repayment of lease liabilities - 33 - 32
Proceeds from borrowings 575 317
Repayment of borrowings - 806 - 788
Transactions with shareholders:
Proceeds of issue of equity - 600
Paid out grants - 32 - 27
4.1 Dividend distributed and other transactions with non-controlling interests - 20 - 18
Total cash flows from financing and grantmaking activities - 316 52
Net cash flow - 31 8
Cash beginning of year 229 223
Exchange adjustment - 18 - 2
Cash end of year 180 229
Note (EUR m) 2025 2024
Cash flows from operating activities
Operating profit 280 279
4.6 Operating profit from discontinued operations 2 - 81
5.2 Adjustment for non-cash items 98 209
Total cash flows from operating activities before financial items,
tax and changes in working capital 380 407
Changes in working capital
Change in receivables - 38 16
Change in inventories 31 - 26
Change in trade payables, other payables etc. 24 - 36
Total change in working capital 17 - 46
Total cash flows from operating activities before financial items and tax 397 361
Income tax paid - 76 - 75
Interest received 32 22
Interest paid - 29 - 69
Total cash flows from operating activities 324 239
Cash flows from investing activities
Divestment of enterprises 8 4
Purchase of property, plant and equipment - 50 - 64
Purchase of other financial investments - 143 - 194
Purchase of intangible assets - 19 - 32
Sale of property, plant and equipment 8 3
Sale of other financial investments 157 -
Total cash flows from investing activities - 39 - 283
Free cash flow 285 - 44
Hempel Foundation Annual Report 2025
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Consolidated
financial statements
1 Basis of preparation
Introduction
The consolidated financial statements of
the Hempel Foundation Group for the period
1 January – 31 December 2025 comprise
the Hempel Foundation and its subsidiaries
(the Hempel Foundation Group).
The Board of Directors considered and approved
the 2025 Annual Report of the Hempel
Foundation on 20 March 2026. The Annual
Report will be submitted for approval at the
Annual General Meeting on 20 March 2026.
Accounting policies
The consolidated financial statements of
the Hempel Foundation Group have been
prepared in accordance with the IFRS
accounting standards as endorsed by the EU
and additional Danish disclosure requirements
applying to entities of reporting class C for large
companies. The notes are grouped in sections
and include the relevant accounting policies.
The Hempel Foundation Group’s significant
accounting estimates and judgements are
described in note 1.2 Significant accounting
estimates and judgements.
Basis of measurement
The consolidated financial statements have been
prepared under the historical cost basis, except
for derivative financial instruments and assets
held for sale that are measured at fair value.
The accounting policies have been applied
consistently in the preparation of the
consolidated financial statements and for the
comparative figures.
Discontinued operations
Discontinued operations are excluded from the
results of continuing operations and presented
as a single amount in profit and loss after tax
from discontinued operations in the statement
of profit and loss. For discontinued operations,
comparatives are restated in the statement
of profit and loss. Refer also to note 4.6
Discontinued operations.
Applying materiality
The consolidated financial statements are
a result of processing large numbers of
transactions and aggregating those transactions
into classes according to their nature or function.
The transactions are presented in classes
of similar items in the consolidated financial
statements. If a line item is not individually
material, it is aggregated with other items of
a similar nature in the consolidated financial
statements or in the notes. Management
provides specific disclosures required by IFRS
unless the information is not applicable or is
considered immaterial to the decision making of
the primary users of these financial statements.
New standards, interpretations and
amendments adopted
The Hempel Foundation Group applied
Amendments to IAS 21 ‘The Effects of
Changes in Foreign Exchange Rates – Lack
of Exchangeability’ from 1 January 2025.
Thisamendment did not have any impact on
the amounts recognised in current or prior
periods and is not expected to significantly
affect future periods.
New standards and interpretations not
yet adopted
New accounting standards and interpretations
that have been issued, but are not mandatory
for the 31 December 2025 reporting period,
have not been early adopted by the Hempel
Foundation Group. These standards are
not expected to have a material impact on
recognition or measurement for the Hempel
Foundation Group in future reporting periods,
or on foreseeable future transactions.
IFRS 18 ‘Presentation and Disclosure in Financial
Statements’ replaces IAS 1 ‘Presentation of
Financial Statements’ and is effective for reporting
periods beginning on or after 1 January 2027.
The Hempel Foundation Group is working to
identify the impact of IFRS 18 on the primary
financial statements and the note disclosures.
Basis of consolidation
The consolidated financial statements comprise
the parent company, Hempel A/S Group, and
entities controlled by the Hempel Foundation
(subsidiaries). Control is achieved when the
Hempel Foundation Group is exposed to, or has
a right to variable returns from, its involvement
with the investee. Subsidiaries are consolidated
from the date on which control commences until
the date on which control ceases.
Control is usually achieved by directly or
indirectly owning, or in other ways controlling,
more than 50% of the votes or other rights
through agreements of management control.
De facto control and other potential voting rights
at the balance sheet date are also considered
when determining whether control is achieved.
Consolidation is performed by summarising
the financial statements of the parent company
and its subsidiaries. On consolidation, items of
a uniform nature are combined. Elimination is
made of intercompany income and expenses,
shareholdings, dividends and intra-group
balance accounts as well as of realised and
1.1 General accounting policies
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Consolidated
financial statements
unrealised gains and losses on transactions
between the consolidated enterprises.
When the Hempel Foundation Group loses
control of a subsidiary, it derecognises assets
(including goodwill), liabilities, the carrying
amount of any non-controlling interests and
components of other comprehensive income
attributable to the non-controlling interests.
Any gain or loss is recognised within other
operating income and expenses.
The acquisition method of accounting is used
to account for business combinations by
the Hempel Foundation Group.
Rounding
In general, rounding may cause variances in
sums and percentages in the Annual Report.
Non-controlling interests
Non-controlling interests’ share in the results
and equity of subsidiaries is shown separately
in the consolidated statement of profit and loss,
statement of comprehensive income, statement
of financial position and statement of changes in
equity, respectively.
The Hempel Foundation Group treats trans-
actions with non-controlling interests that do
not result in a loss of control as transactions with
equity owners of the Hempel Foundation Group.
A change in ownership interest results in an
adjustment between the carrying amounts of
the controlling and non-controlling interests to
reflect their relative interests in the subsidiary.
Any difference between the amount of the
adjustment to non-controlling interests and any
consideration paid or received is recognised in
retained earnings within equity.
Presentation currency
The functional currency of the parent company
is DKK, however the consolidated financial
statements are presented in EUR as the Hempel
Foundation Group operates in a global
environment with international stakeholders.
Translation of transactions and balances in
foreign currencies
Items included in the financial statements of
each of the Hempel Foundation Group entities
are measured using the currency of the primary
economic environment in which the entity
operates (functional currency). Transactions
denominated in other currencies than the
functional currency are considered transactions
denominated in foreign currencies.
Transactions in foreign currencies are translated
into the functional currency defined for each
company using the exchange rates prevailing at
the date of transaction.
Receivables, payables and other monetary
items in foreign currencies are translated at
the exchange rates on the balance sheet date.
Foreign exchange differences arising between
the exchange rates at the transaction date
and at the date of payment are recognised
as foreign exchange gains and losses in the
statement of profit and loss as financial income
or financial expenses.
Non-monetary items recognised in foreign
currencies are measured at the transaction date
rates and are not retranslated subsequently.
Translation of Group companies
The results and financial position of foreign
operations with a functional currency other
than EUR (and which is not the currency of a
hyperinflationary economy) are translated into
the presentation currency EUR as follows:
– assets and liabilities are translated at the
exchange rate on the balance sheet date
– income and expenses in profit and loss
and in the statement of comprehensive
income are translated at monthly average
exchange rates (unless this is not a
reasonable approximation of the rates
prevailing on the transaction dates, in which
case income and expenses are translated
at the dates of the transactions)
– share capital denominated in a currency
that differs from the presentation currency
of the consolidated financial statements is
translated at historical cost
– all resulting exchange differences are
recognised in other comprehensive income
and attributed to a separate translation
reserve in equity. However, where the foreign
entity is not wholly-owned, a proportion of
the translation difference is allocated to the
non-controlling interests.
Foreign currency translation adjustments
of a loan to or borrowings from subsidiaries
which are neither planned nor likely to be
settled in the foreseeable future, and which are
therefore considered to form part of the net
investment in the subsidiary, are recognised
directly in other comprehensive income under
the separate translation reserve within equity.
When a foreign operation is derecognised,
the associated cumulative exchange rate
differences are reclassified to profit or loss, as
part of the gain or loss on sale. Repayment of
loans considered a part of the net investment
in a subsidiary is not considered a disposal
when the Hempel Foundation Group retains
its proportionate ownership interests, thus
the cumulative exchange difference is not
reclassified to profit and loss.
Goodwill and fair value adjustments arising on
the acquisition of a foreign operation are treated
as assets and liabilities of the foreign operation.
1.1 General accounting policies — continued
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Financial investments Sustainability statementFoundation governance Financial performance Statements 59PhilanthropyIntroduction Engaged ownership Financial statements
Consolidated
financial statements
Hyperinflation
In foreign subsidiaries that operate in hyper-
inflationary economies, income and expenses
are translated into the presentational currency
(EUR) at the exchange rate at the balance sheet
date. Prior to translating the financial statements
of foreign operations in hyperinflationary
economies, the income statement and non-
monetary balance sheet items are restated
taking into account changes in the general
purchasing power of the functional currency
based on the inflation up to the balance sheet
date (‘inflation adjustment’). The effect of the
inflation adjustment is recognised in Other
comprehensive income within the translation
reserve. In the income statement, gain/loss on
the net monetary position in the foreign entities
is recognised as financial income or expense.
The assessment as to when an economy is
hyperinflationary is based on qualitative as well
as quantitative factors, including whether the
accumulated inflation over a three-year period
exceeds 100%. Currently, Turkey and Argentina
are considered hyperinflationary economies and
thus the Hempel Foundation Group’s operations
in Argentina and Turkey have been remeasured
in accordance with the principles described,
applying the national Consumer Price Index
(CPI) of Argentina and Turkey, respectively, for
the inflation adjustment.
Classification of operating expenses in
the statement of profit and loss
Production costs
Production costs comprise costs incurred to
generate revenue for the year. Costs comprise
raw materials, consumables, direct labour
costs and indirect production costs, such as
maintenance, amortisation and depreciation,
as well as costs for operation, administration
and management of factories.
Production costs also include research
and development costs that do not qualify
for capitalisation as well as amortisation of
capitalised development costs (except for
amortisation of business application software).
Write-downs of inventory are also included.
Sales and distribution costs
Sales and distribution costs comprise
costs incurred to distribute products and
for sales campaigns, including costs for
sales and distribution staff, advertising
costs, depreciation of sales equipment and
amortisation of customer relationships.
Administrative costs
Administrative costs comprise costs incurred
for management and administration of the
Hempel Foundation Group, including costs
for administrative staff and management as
well as office costs, depreciation and write-
downs for bad debt. Amortisation of brands
and software business applications are also
recognised in administrative costs.
Cash flow statement
The statement of cash flows is presented using
the indirect method. The statement of cash
flows for the Hempel Foundation Group shows
the cash flows for the year, broken down into
operating, investing and financing activities and
changes in the Hempel Foundation Group’s cash
and cash equivalents from the beginning of the
year to the end of the year. The statement of
cash flows cannot be immediately derived from
the published financial records.
Cash flow from operating activities
Cash flow from operating activities is calculated
as the operating profit or loss for the year
adjusted for changes in working capital, non-
cash items such as depreciation, amortisation
and impairment losses and provisions, as well
as interest and tax paid.
Cash flow from investing activities
Cash flow from investing activities comprises
cash flows from purchases and disposals of
intangible assets, property, plant and equipment
and acquisitions/divestments of enterprises.
Cash flow from financing activities
Cash flow from financing activities comprises
cash flows from the raising and repayment
of principal long-term and short-term debt,
including repayment of lease liabilities as well
as payments to and from shareholders.
Cash flow in currencies other than the
functional currency
Cash flow in currencies other than the functional
currency are translated at the average exchange
rates for the month, unless these differ significantly
from the rates at the transaction date, in which case
the exchange rate at the transaction date is applied.
Cash
Cash comprises cash at hand and bank deposits.
1.1 General accounting policies — continued
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1.2 Significant accounting estimates and judgements
In preparation of the consolidated financial
statements, management is required to make
various accounting judgements and estimates
that affect the reported amounts of assets,
liabilities, income and expenses, including the
related disclosures. A degree of uncertainty is
involved in carrying out these judgements and
estimates which could result in adjustments to
the carrying amount of assets and liabilities in
future periods.
The judgements, estimates and the related
assumptions made are based on historical
experience and other factors that management
considers to be reasonable under the given
circumstances. Estimates and judgements are
reviewed on an ongoing basis.
The Hempel Foundation Group’s significant
accounting estimates and judgements are
described below.
Significant accounting estimates and
judgements
The significant accounting estimates are those
that have a significant risk of resulting in a material
adjustment to the carrying amounts of assets
and liabilities in the following reporting period.
Warranties
The Hempel Foundation Group generally offers
warranties for its products and receives claims
under these warranties. Management makes
estimates regarding the related provisions, both
for claims that have already been received and
for claims that may be received in the future
related to products already sold that are still
under warranty at the reporting date. For claims
already received estimates take into account
technical assessments of the validity of the claim,
the costs of remediation and input from internal
and external counsel regarding the probability
of pending legal disputes and future litigation
outcomes. For claims not yet received related
to products sold before the reporting date,
historical warranty claim information is used
as the basis of the estimate of the provision, as
well as recent trends that might suggest that
historical claim levels do not accurately represent
an approximation of the costs of future claims.
Factors that could impact the estimated amounts
include whether the claims are deemed valid,
to what extent the claims are covered by the
product warranty and estimates of the costs
of coating and other associated costs for
remediating any product failure. Reference is
made to note 3.7 Provisions for information
about the Hempel Foundation Group’s
warranty provision.
The Hempel Foundation Group has taken out
insurance against product failures. The product
failure insurance is, to a certain extent, linked
to the size and nature of claims. This reduces
the overall exposure to warranty claims and the
potential net impact on profit and loss from claims.
Uncertain tax positions
The Hempel Foundation Group has activities
and subsidiaries in many different countries,
and therefore is subject to income taxes in
tax jurisdictions around the world. Uncertain
tax positions relate to uncertainty in the
interpretation of tax legislation in the countries
the Hempel Foundation Group operates in.
Significant estimates and judgements are
required when determining the worldwide
accrual for income taxes, deferred income tax
assets and liabilities, and provision for uncertain
tax positions.
In the course of conducting business globally,
transfer pricing disputes with tax authorities may
occur, and management’s judgement is applied
to assess the possible outcome of such disputes.
The Hempel Foundation Group believes that
the provision made for uncertain tax positions is
adequate. However, due to the uncertainty, there
is a possibility that, on conclusion of open tax
matters at a future date, the final outcome may
differ significantly. Reference is made to note 2.5
Income tax, tax assets and liabilities.
Valuation of deferred tax assets
The deferred tax assets comprise carry-forward
tax losses expected to be utilised and temporary
differences.
The Hempel Foundation Group recognises
deferred tax assets, including the expected
value of carry-forward tax losses, based on an
assessment of the recoverability of the deferred
tax assets.
The assessment of the recoverability of
the deferred tax assets involves estimates
by management as to the likelihood of the
utilisation of the deferred tax assets within a
foreseeable future.
This depends on a number of factors, including
whether there will be sufficient taxable profits
available in future periods, against which the
carry-forward tax losses can be utilised. In the
event that actual future taxable profits generated
are less than expected, and depending on the
tax strategies that the Hempel Foundation
Group may be able to implement, impairment
of the deferred tax assets may be required.
Reference is made to note 2.5 Income tax, tax
assets and liabilities.
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Impairment test of goodwill
In performing the annual impairment test,
management assesses whether the groups
of Cash Generating Units (CGUs) to which
the goodwill relates will be able to generate
sufficient positive net cash flows to support
their carrying amount together with other
net assets of the respective groups of CGUs.
This assessment is based on estimates of
expected future cash flows. The cash flows
are derived from the forecast for the next five
years and do not include restructuring activities
that the Hempel Foundation Group is not yet
committed to or significant future investments
that will enhance the performance of the assets
of the groups of CGUs being tested. The
recoverable amount is sensitive to the discount
rate used, as well as the expected future cash
inflows and the terminal growth rate used for
extrapolation purposes. The key assumptions
used to determine the recoverable amount for
the different groups of CGUs are disclosed and
further explained in note 3.1 Intangible assets.
Impairment test of brand
In performing the annual impairment test of the
Farrow & Ball brand, management assesses
whether the brand will be able to generate
sufficient positive net cash flows to support the
carrying amount of the brand. The assessment
is performed using a relief-from-royalty method
based on expected future cash flows generated
from the royalty savings attributable to owning
the brand. The expected cash flows are based
on assumptions about the royalty rate, expected
future revenue and the discount rate. The key
assumptions used to determine the recoverable
amount of the brand are disclosed and further
explained in note 3.1 Intangible assets.
Significant accounting judgements
The significant judgements, apart from those
that involve estimations, are the judgements that
management made in the process of applying
the Hempel Foundation Group’s accounting
policies and that have the most significant effect
on the amounts recognised in the consolidated
financial statements.
Useful life of brands
Management has assessed that certain brands,
mainly the Farrow & Ball brand, have indefinite
useful life as there is no foreseeable limit to
the period over which the brand is expected
to generate net cash inflows, based on the
brand being well-established in its markets,
having existed for decades and having no legal,
regulatory, contractual, competitive, economic or
other factors limiting the useful life of the brand.
1.2 Significant accounting estimates and judgements — continued
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2 Results for the year
Accounting policies
The Hempel Foundation Group mainly
generates revenue from the sale of paints and
coatings (goods for resale and finished goods)
based on prices and conditions stated in the
contracts with customers. The primary revenue-
generating activity comprises sale of finished
goods. In addition, the Hempel Foundation
Group generates a minor part of its revenue from
provision of technical services.
Revenue from sale of paints and coatings is
recognised when the related performance
obligation is satisfied by transferring control of
the promised goods to a customer. The Hempel
Foundation Group’s customer contracts usually
include only a single performance obligation.
Control of the paints and coatings is obtained
when the goods are transferred to the customer.
Where the Hempel Foundation Group provides
technical services, including advice, training,
project oversight and surface management
services, etc., revenue is recognised over time as
the services are rendered.
Revenue from contracts with customers
is measured at an amount that reflects the
consideration to which the Hempel A/S Group
expects to be entitled in exchange for those
goods and services (transaction price), which
normally comprises the price specified in
the contract, net of discounts and customer
bonuses.
The Hempel Foundation Group offers various
discounts, including rebates, bonuses, volume
discounts and payments to customers
depending on the nature of the customer and
business. These discounts are considered
variable consideration. Bonuses and discounts
payable to a customer are accrued for as the
related performance obligations are satisfied
and revenue is recognised. Historical experience
is used to estimate and provide for the
discounts, using the expected value method.
Variable consideration related to discounts is
only recognised as revenue to the extent that
it is highly probable that a significant reversal
will not occur in a later period. In the case of
expected returns, a refund liability and a right to
the returned goods (included in other current
assets) are recognised for the products expected
to be returned.
Revenue
The vast majority of the Hempel Foundation
Group’s performance obligations are satisfied
within one year or less. Amounts for remaining
performance obligations (order backlog) are
therefore not disclosed in accordance with the
practical expedient in IFRS 15.121.
Payments from customers are due depending
on the type of customer and local business
practices, though typically within 30-90 days.
Longer credit terms are provided in certain
countries, though normally not exceeding
180 days. Retail payments are normally due
immediately after control of the goods has
transferred to the customer. Accordingly, no
significant element of financing is present.
Disaggregation of revenue
The following table displays revenue
disaggregated into sale of goods per
geographical region:
2.1 Revenue
Revenue disaggregated into sale of goods per
customer category:
(EUR m) 2025 2024
EMEA 1,213 1,225
Asia-Pacific 721 700
Americas 235 260
Total revenue 2,169 2,185
(EUR m) 2025 2024
Decorative 640 653
Marine 750 709
Energy &
Infrastructure
775 823
Other 4 -
Total revenue 2,169 2,185
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2.2 Employee costs
Accounting policies
Employee costs include wages and salaries,
pensions, social security contributions, annual
leave and sick leave, bonuses and non-monetary
benefits. Employee costs are recognised in the
financial year in which the associated services
are rendered by employees of the Hempel
Foundation Group.
Costs for long-term employee benefits provided
by the Hempel Foundation Group are recognised
in the period in which they are earned.
(EUR m) 2025 2024
Employee costs:
Wages and salaries 382 379
Pensions – defined contribution plans 23 22
Pensions – defined benefit plans 1 2
Other social security contributions 25 24
Other employee costs 23 23
Total employee costs for the year 454 450
Average number of full-time employees 6,941 6,951
Staff costs have been recognised in the profit and loss statement as follows:
Production costs 137 140
Sales and distribution costs 236 229
Administrative costs 81 81
Total employee costs in the profit and loss statement 454 450
For further information about the Hempel
Foundation Group’s pension plans, reference
is made to note 3.6 Pensions and other post-
employment benefit obligations. Equity-settled
share-based payment transactions are measured
at fair value determined at the date of grant
and recognised as an expense over the vesting
period with a corresponding increase in equity.
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2.2 Employee costs — continued
Key management compensation
Together with the Board of Directors, key
management personnel comprise individuals in
the Executive Board and the Executive Group
Management (EGM). Registered Executive
Management is a part of the EGM and the EGM
consists of 12 individuals (2024: 11 individuals).
Remuneration of the Executive Group
Management includes a fixed salary, company
car and other standard fringe benefits, as well as
bonus payments in the form of an annual cash
bonus and a long-term cash-based incentive
scheme with specific financial targets for organic
growth, EBITDA and working capital. The annual
cash bonus cannot exceed 70-100% of the
individual’s fixed salary.
The annual cash bonus payment is contingent
upon the fulfilment of ESG targets, inluding
climate targets, and the realisation of specific
financial targets.
During 2024, a management incentive plan
was implemented whereby members of the
EGM and certain other senior managers were
offered the opportunity to purchase, at fair value,
shares and warrants of the Hempel A/S Group.
New members of the EGM in 2025 were offered
the same opportunity.
The arrangement is classified as an equity-
settled arrangement. As the participants in
the plan paid fair value for the shares and
warrants purchased, no share-based payment
expense was incurred by the Company as a
result of these equity-settled transactions. If
a participant ceases to be an employee of the
Hempel A/S Group, the provisions of the plan
may permit or require the Hempel A/S Group
to repurchase the leaver’s shareholdings for
either the original cost or fair value at the time of
repurchase, depending upon the circumstances.
See note 4.1 for further information.
A long-term cash-based incentive scheme
comprised of rolling three-year cash-based
bonus programmes was discontinued for the
EGM and certain other senior managers in 2024.
All programmes were subject to vesting criteria
based on a number of factors, including the
realisation of minimum financial targets for the
nominal EBITDA accumulated over the three-
year period. The outcome was calculated at the
end of the three-year programme period. The
long-term cash incentive programme payment
cannot exceed 110-220% of the individual’s fixed
annual salary. Final payments for the relevant
participants under this scheme were made in
2024 and are included in the table on this page.
The board of Directors in Hempel A/S Group
determines annually whether to instigate new
programmes and, if so, the scope and objectives
of said programmes.
The compensation paid or payable to the key
management personnel for employee services is
shown in the table to the left. Total remuneration
for Registered Executive Management and the
Boards of Directors amounted to EUR 10 million
in 2025 (2024: EUR 16 million).
Salaries and remuneration for the Hempel Foundation Group
Executive Team and Board of Directors (EUR t)
Board & directors in
the Hempel Foundation
1
Other key management
2
Total
2025 2024 2025 2024 2025 2024
Remunerations, salaries and other costs 1,324 1,304 7,200 8,000 8,524 9,304
Commitees and other costs 275 206 - - 275 206
Pensions – defined contribution plans - 400 600 400 600
Severance pay - 800 2,000 800 2,000
Other long-term benefits - - 3,900 - 3,900
Total 1,599 1,510 8,400 14,500 9,999 16,010
1
With reference to section 98b subsection 2 of the Danish Financial Statement Act, the remuneration for the Executive Management and the Board of Directors are disclosed together,
as the Executive Management consists of one member.
2
Other key management consists of key management and the Board of Directors of the Hempel A/S Group.
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2.3 Other operating income and expenses 2.4 Special items
Accounting policies
Other operating income and expenses comprise
items of a secondary nature to the core activities
of the Hempel Foundation, including gains
and losses on the sale of intangible assets and
property, plant and equipment and certain
government grants.
Government grants are recognised in other
operating income at fair value where there is
a reasonable assurance that the grant will be
received and the Hempel Foundation will comply
with all attached conditions. Government grants
relating to costs are deferred and recognised in
the statement of profit and loss and presented in
the same line item as the relating costs, over the
period necessary to match them with the costs
that they are intended to compensate.
Grants received for the acquisition of property,
plant and equipment are recognised as deferred
income, which is recognised in the statement of
profit and loss under other operating income on a
systematic basis over the useful life of the asset.
Special items include significant income
and expenses of a special nature relative to
the Hempel Foundation Group’s earnings-
generating activities, such as costs related to
M&A activities (including gains and losses on
disposals of businesses), integration of acquired
businesses and significant restructuring costs.
Other significant amounts of a non-recurring
nature are also included in special items.
Due to the significant impact on the statement
of profit or loss, these non-recurring items
of special nature are disclosed separately in
this note. The special items are presented in the
statement of profit or loss within the functions
shown in the table below.
In 2025, restructuring costs mainly comprised
severance pay; the restructuring initiatives are
aligned with the Hempel Foundation Group’s
strategic ambition to improve competitiveness.
Special items (EUR m) 2025 2024
Restructuring costs 7 -
M&A and integration related costs - 4 -
Total special items 3 -
(EUR m) 2025 2024
Production costs 2 -
Sales and distribution costs 3 -
Administrative costs 2 -
Other operating income - 4 -
Total special items 3 -
Other operating income (EUR m) 2025 2024
Gain on sale of property, plant and equipment 9 -
Other operating income 3 3
Total other operating income 12 3
Other operating expenses (EUR m) 2025 2024
Loss on sale of property, plant and equipment - 1 -
Total other operating expenses - 1 -
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2.5 Income tax, tax assets and liabilities
Income tax
Accounting policies
The income tax expense for the year is the tax
payable on the current year’s taxable income
based on the applicable income tax rate for each
jurisdiction, adjusted for changes in deferred tax
assets and liabilities attributable to temporary
differences and to unused tax losses, changes
due to changes in tax rates, adjustments to tax
from previous years and changes in provision for
uncertain tax positions.
Current tax payable and receivable are
recognised in the consolidated statement of
financial position as tax computed on the taxable
income for the year, adjusted for tax on taxable
income for prior years and for prepaid tax.
Current tax and changes in deferred tax are
recognised in profit and loss, except to the extent
that they relate to items recognised in other
comprehensive income or directly in equity. In
these cases, the tax is also recognised in other
comprehensive income or directly in equity,
respectively.
The current income tax charge is calculated on
the basis of the tax laws enacted or substantively
enacted at the balance sheet date in the
countries where the parent 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.
In the case of uncertain tax positions, if it
is considered probable that the Hempel
Foundation Group’s proposed tax treatment
will be accepted by the taxation authority, such
position is recognised in the financial statements.
If acceptance by the taxation authority is
not considered probable, the uncertainty is
reflected in the amounts of tax assets and
liabilities recognised. Uncertain tax positions are
assessed individually, and the possible outcome
is measureed based on either the most likely
amount or a probability-weighted expected
value, depending on which method is considered
to better predict the resolution of the uncertainty.
Uncertain tax positions relate to various tax
disputes, including transfer pricing cases.
The Hempel Foundation has the option to
use section 3(4) of the Danish Corporation
Tax Act. Under these rules, the taxable income
of Hempel Invest A/S is considered to have
been earned by the Hempel Foundation if the
taxable income is distributed as a dividend to
the Hempel Foundation. Since the Hempel
Foundation’s taxable income is regularly offset
against grants for the year and tax provisions for
future grants, no deferred tax asset or liability is
recognised owned by the Hempel Foundation.
Tax for the year (EUR m) 2025 2024
Tax for the year is specified as follows:
Tax on profit for the year - 47 - 50
Tax on other comprehensive income 6 - 6
Total tax for the year - 41 - 56
Tax on profit for the year is calculated as follows:
Current tax for the year - 44 - 72
Deferred tax for the year 6 23
Adjustment in respect of previous years, Current tax - 2 4
Adjustment in respect of previous years, Deferred tax - 7 - 5
Total tax on profit for the year - 47 - 50
Effective tax rate of the Hempel Foundation Group
Danish tax rate 22.0% 22.0%
Higher/(lower) tax rates of foreign subsidiaries - 3.9% - 1.6%
Permanent differences 0.2% 0.5%
Unrecognised deferred tax assets 5.5% 5.3%
Recognised deferred tax assets related to prior years - 1.0% - 6.6%
Adjustments in respect of previous years - 3.6% - 0.3%
Other adjustments 0.0% 0.1%
Withholding taxes etc. 2.6% 1.9%
Deduction for grants 0.0% - 2.3%
Effective tax rate of the Hempel Foundation Group excluding hyperinflation 21.8% 19.0%
Hyperinflation 0.3% 1.3%
Effective tax rate of the Hempel Foundation Group 22.1% 20.3%
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2.5 Income tax, tax assets and liabilities — continued
Deferred tax
Accounting policies
Deferred income tax is provided in full, using
the liability method, on temporary differences
arising between the tax bases of assets and
liabilities and their carrying amounts in the
consolidated financial statements. However,
deferred tax liabilities are not recognised if they
arise from the initial recognition of goodwill.
Deferred income tax is also not accounted for
if it arises from initial recognition of an asset or
liability in a transaction other than a business
combination that, at the time of the transaction,
affects neither accounting profit nor taxable
profit or loss. Deferred income tax is calculated
using tax rates (and laws) that have been
enacted or substantially enacted by the end of
the reporting period and are expected to apply
when the related deferred income tax asset is
realised or the deferred income tax liability is
settled. Deferred tax is adjusted for elimination
of unrealised intra-group gains and losses.
Deferred tax recognised in the balance sheet (EUR m) 2025 2024
Deferred tax, beginning of year 52 36
Recognised in profit & loss 6 23
Adjustments in respect of previous year 3 - 6
Recognised in other comprehensive income 4 -
Deferred tax assets and liabilities at 31 December, net 65 53
Specification of deferred tax assets (EUR m) 2025 2024
Intangible assets 10 16
Property, plant and equipment 2 7
Inventories 7 2
Trade receivables 6 2
Provisions and defined benefit obligations 23 30
Lease liabilities 2 2
Tax loss carryforwards 73 64
Tax on other comprehensive income 4 -
Deferred tax assets at 31 December 127 123
Specification of deferred tax liabilities (EUR m) 2025 2024
Intangible assets 38 40
Property, plant and equipment 6 2
Provisions and defined benefit obligations 18 28
Deferred tax liabilities at 31 December 62 70
Deferred tax assets are recognised if it is probable
that future taxable amounts will be available to
utilise those temporary differences and losses.
Deferred tax liabilities and assets are not
recognised for temporary differences
between the carrying amount and tax bases of
investments in foreign operations where the
Hempel Foundation Group is able to control
the timing of the reversal of the temporary
differences and it is probable that the differences
will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset
when there is a legally enforceable right to offset
current tax assets and liabilities and when the
deferred tax balances relate to the same taxation
authority. Current tax assets and tax liabilities are
offset where the entity has a legally enforceable
right to offset and intends either to settle on a
net basis, or to realise the asset and settle the
liability simultaneously.
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The Hempel Foundation Group recognises
deferred tax assets, including the expected value
of tax loss carryforwards, to the extent that it
is probable that taxable profit will be available
against which the deductible differences
and unused tax losses can be utilised.
At 31 December 2025, the Hempel Foundation
Group recognised a deferred tax asset related
to tax loss carryforwards of EUR 60 million
(2024: EUR 64 million).
Management has considered future taxable
income and applied judgement in assessing
whether deferred income tax assets should be
recognised. The assessment of the recoverability
of the deferred tax assets depends on a number
of factors, including whether there will be
sufficient taxable profits available in future
periods in tax jurisdictions for which the tax loss
carryforwards can be utilised.
Assessment of the recoverability of the
deferred tax assets is based on taxable income
projections that contain estimates of, and tax
strategies for, the future taxable income, taking
into account the general market conditions,
recent financial performance of the individual
entities and the Hempel Foundation Group’s
approved business plan. The projections are
based on the Hempel Foundation Group’s five-
year forecast, though in certain cases a longer
forecast period is applied, and are inherently
subject to uncertainty, as the realisation of the
projections is dependent on the outcome of
future events. It is management’s assessment
that the forecast is achievable and supports
the capitalised deferred tax assets. In making
this assessment, business initiatives to improve
organic growth and taxable income are
considered together with expected allocation
of future taxable income based on the transfer
pricing policy in place.
The international tax reform
– Pillar Two model rules
The Pillar Two model rules apply for the
Hempel Foundation Group as of 1 January 2024.
The current tax expense related to Pillar Two
income taxes amounts to EUR 2.8 million for
2025 (2024: EUR 1.7).
The Hempel Foundation Group has applied the
exception of not recognising deferred tax assets
and liabilities arising from the implementation of
the Pillar Two model rules.
2.5 Income tax, tax assets and liabilities — continued
Deferred tax not recognised in the balance sheet (EUR m) 2025 2024
Temporary differences 4 1
Tax loss carryforwards 58 44
Total tax asset not recognised 62 45
2025 2024
Temporary differences, gross 14 3
Tax loss carryforwards, gross
1
222 149
Total tax asset not recognised 236 152
1
Out of tax loss carryforwards: 0% (2024: 0%) expire within 1 year, 1% (2024: 0%) within 5 years and 3% (2024: 15-20%)
after 5 years from the balance sheet date.
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3 Operating assets and liabilities
3.1 Intangible assets
Amortisations and impairment losses included in profit and loss (EUR m) 2025 2024
Production costs 4 6
Sales and distribution costs 4 6
Administrative costs 16 17
Total amortisation and impairment 24 29
Accounting policies
Goodwill
Goodwill is initially recognised in the statement
of financial position at cost and allocated to
groups of CGUs at which goodwill is monitored.
Subsequently, goodwill is measured at cost less
accumulated impairment losses. Goodwill is not
amortised.
Brands with an indefinite useful life
Brands acquired in a business combination are
initially recognised in the statement of financial
position at fair value and subsequently measured
at cost less accumulated impairment losses.
Brands which are considered to have an
indefinite useful life are not amortised, since
there is no foreseeable limit to the period over
which the brands are expected to generate
net cash inflows.
Software and software under development
Acquired software and developed software are
initially measured at cost and subsequently at
cost less amortisation and impairment losses.
Acquired software and developed software
are amortised on a straight-line basis over
the estimated useful life, which is 3-10 years,
though typically 5 years for ERP systems.
For software as a service (SaaS) arrangements,
implementation costs are capitalised only
where customisation and configuration of the
SaaS arrangement results in an intangible asset
controlled by the Hempel Foundation Group.
Where customisation and configuration costs do
not result in an intangible asset, costs are either
expensed as incurred or alternatively over the
contract term when the received services are
not distinct from the SaaS solution.
Software under development is recognised at
cost less impairment losses. Software under
development is not amortised.
Customer relationships
Customer relationships acquired in a business
combination are initially recognised at fair
value and subsequently measured at cost less
accumulated amortisation and impairment
losses. Amortisation is calculated on a straight-
line basis over the estimated useful life, which
is 5-12 years.
Other intangible assets
Other intangible assets comprise development
projects such as development of products or
processes, formulas and smaller brands.
Development projects are recognised as
intangible assets where they relate to products
or processes (other than software 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 manufacture, market or use the product or
process in question. Development projects are
initially measured at cost, which comprises
expenses, including salaries, amortisation and
external costs, directly attributable to these
development projects. Development projects are
subsequently measured at cost less amortisation
and impairment losses.
Development projects are amortised on a
straight-line basis over the estimated useful life,
which is 3-10 years.
Formulas and smaller brands are measured
at cost less accumulated amortisation and
impairment losses. The assets are amortised on
a straight-line basis over their estimated useful
lives. The amortisation period is 2-10 years.
Amortisation and impairment are included as
follows in the statement of profit and loss.
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3.1 Intangible assets — continued
Research and development costs expensed
Research and development costs not eligible for
capitalisation are expensed in the period incurred
and included in the statement of profit and loss
within production costs. In 2025, this amounted
to EUR 34 million (2024: EUR 36 million).
Impairment of non-current assets
Goodwill, intangible assets with an indefinite
useful life and software under development that
is not subject to amortisation are tested annually
for impairment, or more frequently if events or
changes in circumstances indicate that they
might be impaired. Other assets are tested for
impairment whenever events or changes in
circumstances indicate that the carrying amount
may not be recoverable. An impairment loss is
recognised 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 costs of disposal and value
in use. For the purposes of assessing impairment,
assets are grouped at the lowest levels for which
there are separately identifiable cash inflows that
are largely independent of the cash inflows from
other assets or groups of assets defined as Cash
Generating Units (CGUs). Non-financial assets
other than goodwill that suffered an impairment
are reviewed for possible reversal of the impair-
ment at the end of each reporting period.
Impairment test
The Hempel Foundation Group has tested the
carrying amount of software under development,
brands with indefinite useful life and goodwill for
impairment.
Goodwill is monitored based on three commercial
business units (Marine, Energy & Infrastructure
and Decorative). Goodwill is allocated to the
groups of CGUs as follows:
(EUR m) 2025 2024
Marine 171 180
Energy & Infrastructure 116 123
Decorative 241 254
Total goodwill 528 557
The three key commercial business units
manage sales and are responsible for daily
contact with customers.
Marine customers comprise newbuilding
shipyards, ship owners requiring maintenance in
dry dock or at sea, and maintenance contractors.
Maintenance work relates to every area of a
vessel, most notably hull coating systems to
protect the metal structure of the vessels.
Energy customers are owners of energy assets,
which are often subject to harsh weather
conditions, such as windmills and other
energy solution assets. Infrastructure mainly
relates to bridges, transportation assets and
infrastructure buildings. Customers are e.g.
governments responsible for maintenance
of critical infrastructure, companies that
own infrastructure assets and maintenance
contractors.
Decorative sells indoor and outdoor coating
products. Decorative customers are both private
and commercial customers, e.g. retailers.
Impairment test goodwill
In determining the carrying amount of net assets
of each group of CGUs, certain allocation keys
are applied.
The recoverable amounts of each group of
CGUs are based on value-in-use calculations
and based on cash flow projections for the
years 2026-2030. The forecast represents
management’s best estimate of the future cash
flows and is assumed to be both reasonable
and achievable. The assumptions applied by
management in forecasting the future cash flows
reflect management’s expectations considering
all relevant factors, including the Hempel
Foundation Group’s strategic initiatives, local
initiatives, past experience and external sources
of information, where possible and relevant.
The key assumptions used in the cash flow
projections are revenue growth, EBITDA margin,
long-term growth rate and pre-tax discount
rate (refer to the table on the next page). Cash
flows beyond the five-year forecast period are
extrapolated using the estimated growth rates
stated in the table on the next page.
Sensitivity analysis
Management considered and assessed
reasonably possible changes for the key
assumptions and did not identify any instances
that could cause the carrying amount of
goodwill to exceed its recoverable amount.
Impairment test of the Farrow & Ball brand
The carrying amount of the Farrow & Ball brand
with an indefinite useful life of EUR 134 million
(2024: 141 million) was tested separately
for impairment as the brand relates to the
Farrow & Ball CGU. The recoverable amount is
calculated based on a relief-from-royalty method,
assuming a steady revenue growth of average
8.2 % (2024: 5.6%) in the forecasting period
based on expected market development within
the luxury paint business.
The royalty rate applied in the relief-from-royalty
calculation is based on a benchmark study for
high-end brands with similar market position
to Farrow & Ball. A royalty rate of 6.15% (2024:
6.15%) and a weighted average cost of capital
(WACC) of 8.8% (2024: 8.16%) were applied.
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3.1 Intangible assets — continued
Key assumption Description
Revenue growth and EBITDA margin Revenue for all commercial business units is assumed to increase over the forecasting period on average by mid to high single-digit growth rates,
assuming a slight increase in market share. This is based on past performance and assumptions about stable raw material prices in the forecast period,
the general market development in the different commercial business areas, taking into consideration the maturity of the markets in which the Hempel
Foundation Group operates. Further, Group and local strategic initiatives are considered when estimating the revenue growth rates for the individual
commercial businesses, including initiatives focusing on increasing sales prices and volumes. A stable EBITDA margin is assumed in all the commercial
business units in the forecasting period, based on the business units’ ability to generally increase selling prices in line with long-term inflation.
The estimated revenue growth in Decorative is, in particular, to be achieved through its strong market position, increasing brand awareness and
companies and stores acquired that increase Decorative’s accessibility in selected markets. In addition, Decorative has increased its e-commerce
presence in key markets and opened new stores in strategic geographical locations which is expected to help drive an increase in volumes.
For Marine, the estimated revenue growth is to be achieved through its highly competitive products, e.g. hull coatings, and higher sales prices through
a more value-based price setting model, as well as increased sales volumes based on the assumed continuation of the trend of increasing demand for
products in the marine industry that reduce both fuel consumption and CO
2
emissions.
For Energy & Infrastructure, the estimated revenue growth is based on the continued global demand for high-performance sustainable coating
solutions across the energy and infrastructure sectors. This includes the continued launch of improved solutions for both new constructions and
maintenance work on global energy and infrastructure assets, thereby continuing the segment’s offer of high value to its customers through its value-
based commercial model.
Long-term growth The terminal growth rates do not exceed expected long-term inflation.
Pre-tax discount rate The pre-tax discount rate reflects the specific risks to the CGUs.
(EUR m) Long-term growth rate 2025 Long-term growth rate 2024 Pre-tax discount rate 2025 Pre-tax discount rate 2024
Marine 2.00% 2.00% 8.96% 9.18%
Energy & Infrastructure 2.00% 2.00% 9.60% 9.67%
Decorative 2.00% 2.00% 9.45% 9.18%
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3.1 Intangible assets — continued
Intangible assets (EUR m) Goodwill Brands
(indefinite life)
Software Intangible
assets under
construction
Customer
relationships
Other
intangible
assets
Total
Costs at 1 January 2025 557 145 119 17 131 108 1,077
Effect of exchange rate adjustment - 29 - 6 - 5 - 1 - 12 - 5 - 58
Additions for the year - - 6 13 - - 19
Transfer and reclassifications - - 10 - 14 - 4 -
Disposals for the year - - - 13 - - 1 - 1 - 15
Reclassification assets held for sale - - - - - - -
Costs at 31 December 2025 528 139 117 15 118 106 1,023
Accumulated amortisation at 1 January 2025 - - 86 - 119 79 284
Effect of exchange rate adjustment - - - 3 - - 11 - 3 - 17
Amortisation for the year - - 14 - 4 6 24
Impairment for the year - - - - - - -
Reversal of amortisation of assets disposed - - - 10 - - 1 - - 11
Accumulated amortisation at 31 December 2025 - - 87 - 111 82 280
Carrying amount at 31 December 2025 528 139 30 15 7 24 743
Costs at 1 January 2024 535 139 82 35 141 99 1,031
Effect of exchange rate adjustment 22 6 2 - 7 2 39
Additions for the year - - 1 31 - - 32
Transfer and reclassifications - - 39 - 49 - 10 -
Disposals for the year - - - 5 - - 17 - 3 - 25
Costs at 31 December 2024 557 145 119 17 131 108 1,077
Accumulated amortisation at 1 January 2024
1
- - 74 - 124 72 270
Effect of exchange rate adjustment - - 1 - 7 2 10
Amortisation for the year - - 15 - 6 8 29
Impairment for the year - - - - - - -
Reversal of amortisation of assets disposed - - - 5 - - 17 - 3 - 25
Accumulated amortisation at 31 December 2024 - - 85 - 120 79 284
Carrying amount at 31 December 2024 557 145 34 17 11 29 793
1
Brought forward balances at 1 January 2024 include minor reclassifications between asset categories, and between cost and accumulated depreciation,
arising on a group consolidation system implementation during the year, with no impact on the total carrying amount.
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Property, plant and equipment are measured
at cost less accumulated depreciation and
impairment losses.
Costs comprise the purchase price, including
import duties, non-refundable taxes andA
expenses directly related to the acquisition
up until the time when the asset is ready for
intended use. In the case of assets of own
construction, costs comprise direct expenses for
labour, materials, components and suppliers.
Material general and specific borrowing costs
that are directly attributable to the construction
or production of a qualifying asset are capitalised
during the period of time that is required to
complete and prepare the asset for its intended
use. Qualifying assets are assets that necessarily
take a substantial period of time to get ready for
their intended use or sale.
Subsequent costs, such as partial replacement
of property, plant and equipment, are included
in the carrying amount of the asset in question
when it is probable that such costs will result
in future economic benefits. The carrying
amount of the replaced parts is derecognised
from the balance sheet and recognised in the
statement of profit and loss. All other repairs and
maintenance are charged to profit or loss during
the reporting period in which they are incurred.
Depreciation is based on the costs of an asset
less its residual value. Depreciation is calculated
on a straight-line basis over the expected useful
lives of the assets, which are:
Buildings (max.) 50 years
Laboratory equipment 10 years
Plant and machinery 10 years
Other fixtures and fittings,
tools and equipment 3-10 years
If the individual material components of an asset
have different useful lives, each component is
depreciated separately. Gains and losses on
disposals are determined by comparing proceeds
with the carrying amount. These gains and
losses are included in other operating income
and expenses (refer to note 2.3 Other operating
income and expenses). The assets’ residual
values and useful lives are reviewed, and adjusted
if necessary, at the end of each reporting period.
Information about commitments for acquisition
of property, plant and equipment is provided
in note 5.3 Contingent liabilities and other
commitments.
3.2 Property, plant and equipment
Depreciation and impairment losses included in profit and loss (EUR m) 2025 2024
Production costs 32 34
Sales and distribution costs 6 6
Administrative costs 10 10
Discontinued operations - 1
Total depreciation and impairment losses 48 51
Property, plant and equipment are reviewed on
an annual basis to determine whether there is
any indication of impairment and, if so, a review
of the carrying amount exceeds its recoverable
amount, an impairment loss is recognised in the
statement of profit and loss.
Depreciation and impairment losses are included
in the statement of profit and loss as follows:
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3.2 Property, plant and equipment — continued
Property, plant and equipment (EUR m) Land and
buildings
Plant and
machinery
Other fixtures
and fittings, tools
and equipment
Assets under
construction
Total
Costs at 1 January 2025 496 355 163 49 1,063
Hyperinflation
Effect of exchange rate adjustment - 25 - 23 - 9 - 2 - 59
Additions for the year
1
1 4 5 40 50
Transfer and reclassifications 5 21 6 - 32 -
Disposals for the year - 22 - 6 - 10 - - 38
Costs at 31 December 2025 455 351 155 55 1,016
Accumulated depreciations at 1 January 2025 136 229 104 - 469
Effect of exchange rate adjustment - 10 - 15 - 7 - - 32
Depreciation for the year 12 22 14 - 48
Disposals for the year - 7 - 5 - 6 - - 18
Reversal of depreciations of assets disposed - 5 - 3 - - 8
Accumulated depreciation at 31 December 2025 126 231 102 - 459
Carrying amount at 31 December 2025 329 120 53 55 557
Costs at 1 January 2024
2
513 349 147 48 1,057
Effect of exchange rate adjustment 12 12 5 1 30
Additions for the year
1
8 5 7 36 56
Transfer and reclassifications - 15 16 - 31 -
Disposals for the year - 37 - 26 - 12 - 5 - 80
Costs at 31 December 2024 496 355 163 49 1,063
Accumulated depreciations at 1 January 2024
2
143 212 97 - 452
Effect of exchange rate adjustment 5 8 4 - 17
Depreciation for the year 14 23 14 - 51
Reversal of depreciations of assets disposed - 26 - 14 - 11 - - 51
Accumulated depreciation at 31 December 2024 136 229 104 - 469
Carrying amount at 31 December 2024 360 126 59 49 594
1
There are no capitalised borrowing costs for the year 2025 and 2024.
2
Brought forward balances at 1 January 2024 include minor reclassifications between asset categories, and between cost and accumulated depreciation, arising on a group consolidation system
implementation during the year, with no impact on the total carrying amount.
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Accounting policies
Lease liabilities
At the commencement date of leases, the
Hempel Foundation Group recognises lease
liabilities, measured at the present value, of the
lease payments to be made over the lease term.
The lease payments include fixed payments
less any lease incentive receivables, variable
lease payments that depend on an index or
rate, e.g. when a minimum indexation is applied,
and amounts expected to be paid under
residual value guarantees. The lease payments
also include the exercise price of a purchase
option reasonably certain to be exercised by
the Hempel Foundation Group and payment
of penalties for terminating a lease, if the lease
term reflects the Hempel Foundation Group
exercising the option to terminate. The present
value is calculated using the interest rate implicit
in the lease or the Hempel Foundation Group’s
incremental borrowing rate if the interest rate
implicit in the lease is not readily determinable.
Contracts may contain both lease and non-
lease components. The Hempel Foundation
Group has elected to separate lease and
non-lease components. For these contracts,
the consideration promised in the contract is
allocated based on the relative stand-alone
prices between the lease and non-lease
component. Non-lease components are
accounted for in accordance with the accounting
policy applicable to such items.
Some lease contracts include extension and
termination options. Management exercises
judgement in determining whether these
options are reasonably certain to be exercised.
Management considers all relevant facts and
circumstances that create an economic incentive
to exercise the extension option.
After initial recognition, the lease liability is
measured at amortised cost using the effective
interest method. The lease liability is increased
to reflect the accretion of interest and reduced
for lease payments made. The lease liability is
remeasured when there is a change in the lease
term or a change in the assessment to purchase
the underlying asset. In addition, the lease liability
is remeasured if there is a change in future lease
payments arising from a change in an index
or rate, including revised lease payments that
reflect a change in market rental rates, or if there
is a change in the Hempel Foundation Group’s
estimate of the amount expected to be payable
under a residual value guarantee.
3.3 Leases
When lease liabilities are remeasured, a
corresponding adjustment is made to the
carrying amount of the right-of-use asset. If
the carrying amount of the right-of-use asset
is reduced to zero, any further reduction is
recognised in the statement of profit and loss.
Right-of-use assets
The Hempel Foundation Group recognises
right-of-use assets at the commencement date
of the lease. Right-of-use assets are initially
measured at cost comprising the amount of the
initial measurement of the lease liability, adjusted
for any lease payments made at or before the
commencement date and any initial direct costs
incurred. Dismantling and restoration costs are
not included in the calculation of the right-of-use
assets value, but are booked separately.
After initial recognition, right-of-use assets are
measured at cost less accumulated depreciation
and impairment losses and adjusted for any
remeasurement of the lease liability. Depreciation
is calculated on a straight-line basis over the
shorter of the useful life of the asset and the
lease term.
Right-of-use assets mainly comprise office and
warehouse buildings, stores, warehouses and
vehicles, such as cars, trucks and vans. Lease
terms of buildings are usually 5-10 years whereas
vehicles typically have a lease term of 3-5 years.
Short-term and low-value leases
Short-term and low-value leases are expensed
directly as operating costs in the statement of
profit and loss, usually on a straight-line basis
over the lease term.
The Hempel Foundation Group has recognised
the following amounts relating to leases, as
shown on the next page.
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3.3 Leases — continued
Depreciation charge of right-of-use assets (EUR m) 2025 2024
Land and buildings 30 26
Vehicles 9 8
Other fixed assets 3 -
Total depreciation and impairment losses 42 34
The statement of profit and loss shows the
following expenses relating to leases:
Amounts relating to leases (EUR m) 2025 2024
Right-of-use assets, additions 21 21
Right-of-use assets, carrying amount
Land and buildings 64 75
Vehicles 17 16
Other fixed assets - 1
Total 81 92
Lease liabilities
Short-term lease liabilities 24 29
Long-term lease liabilities 60 67
Total 84 96
Total cash outflow from leases amounts to EUR 33 million, including cash outflow from short-term and low-value leases (2024: EUR
32 million). The maturity analysis of undiscounted cash flows in lease liabilities is disclosed in note 4.3 Financial risks. The following
lease expenses are recognised in the statement of profit or loss:
Expenses relating to leases (EUR m) 2025 2024
Depreciation included in profit or loss
Production costs 11 12
Sales and distribution costs 21 19
Administrative costs 2 2
Discontinued costs - 1
Total depreciation 34 34
Interest expense on leases 4 4
Expenses related to short-term leases 1 1
Total amount recognised in profit or loss 39 39
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3.4 Inventories
Accounting policies
Inventories are measured at cost, determined
using the FIFO-method, or net realisable
value if the net realisable value is lower. Costs
of inventories comprise purchase costs of
raw materials, including import duties and
transportation costs directly attributable to the
acquisition of raw materials, costs of conversion
and other costs incurred in bringing the
inventories to the present location and condition.
The costs of finished goods and work in
progress also include indirect production
costs, which 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 and costs of factory administration and
management.
The net realisable value is calculated as the
selling price less costs of completion and costs
necessary to make the sale and is determined
based on the most reliable evidence available
at the time the estimates are made, taking into
account obsolescence and development in
expected selling prices.
(EUR m) 2025 2024
Raw materials and consumables 88 108
Work in progress 8 9
Finished goods 181 219
Total inventories 277 336
Cost of inventories, included under production costs
1
1,132 1,193
Hereof write-downs to net realisable value during the year 15 11
1
2024 restated to exclude cost of inventories included within discontinued operations – see Note 4.6 for further information.
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3.5 Trade receivables
Accounting policies
Trade receivables are recognised initially at
their transaction price. The Hempel Foundation
Group holds trade receivables with the objective
of collecting the contractual cash flows and
therefore measures them subsequently at
amortised cost using the effective interest
method, less loss allowance.
Due to the short-term nature of trade receivables,
amortised cost will equal the invoiced amount
less loss allowance for expected credit losses.
Credit risk
The Hempel Foundation Group is exposed to
financial and commercial counterparties but
has no particular concentration of customers.
To minimise the credit risk related to trade
receivables, financial vetting is undertaken for all
major customers and credit limits are assigned
for major customers based on the Hempel
Foundation Group’s credit risk assessment.
The Hempel Foundation Group applies the
simplified approach to providing the expected
credit losses, which permits the use of the
lifetime expected loss provision for all trade
receivables. To measure the expected credit
losses, trade receivables are grouped based on
shared credit risk characteristics and the days
past due. Trade receivables not due are also
included when assessing the expected lifetime
loss provision.
Trade receivables are written off when there is no
reasonable expectation of recovery, i.e. typically
when customers are undergoing restructuring or
bankruptcy proceedings have commenced.
The Hempel Foundation Group’s maximum
exposure to credit risk at the end of the reporting
period related to trade receivables is the carrying
amount of trade receivables mentioned above.
The Hempel Foundation Group does not hold
collateral as security.
Expected credit loss 2025 (EUR m) Carrying
amount, gross
Expected
loss rate (%)
Loss
allowance
Carrying
amount, net
Current 334 0.4% 1.4 333
Overdue 1-30 days 53 0.4% 0.2 52
Overdue 31-60 days 22 0.4% 0.1 22
Overdue 61-120 days 19 0.8% 0.1 18
Overdue 121-240 days 14 9.6% 1.3 12
Overdue 241-360 days 4 33.9% 1.3 3
Overdue > 360 days 25 92.0% 23.4 2
Total 471 27.8 442
Expected credit loss 2024 (EUR m) Carrying
amount, gross
Expected
loss rate (%)
Loss
allowance
Carrying
amount, net
Current 338 0.8% 2.7 335
Overdue 1-30 days 54 1.0% 0.5 55
Overdue 31-60 days 24 3.0% 0.7 23
Overdue 61-120 days 18 3.6% 0.6 17
Overdue 121-240 days 17 12.6% 2.1 15
Overdue 241-360 days 6 21.7% 1.3 5
Overdue > 360 days 40 99.0% 39.6 -
Total 497 47.5 450
Loss allowance provision (EUR m) 2025 2024
Provision at 1 January 48 38
Sale of enterprises - - 1
Additions for the year - 5 14
Losses recognised - 11 - 5
Reversal of provisions from previous years - -
Currency translation - 4 2
Total 28 48
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3.6 Pensions and other post-employment benefit obligations
Accounting policies
The Hempel Foundation Group operates various
post-employment schemes, including defined
benefit and defined contribution pension plans.
Defined contribution plans
The Hempel Foundation Group operates a
number of defined contribution plans which
provide post-employment benefits determined
by the value of funds contributed in respect of
each employee. The Hempel Foundation Group’s
contributions to the defined contribution plans
are recognised in profit and loss in the year
in which they become payable. The Hempel
Foundation Group’s obligation is limited to
the amount that it agrees to contribute to the
plans; it has no further obligation once the
contributions have been paid. Contributions
payable are recognised in the statement of
financial position within other current liabilities.
Defined benefit plans
For defined post-employment benefit plans, the
surplus or deficit recognised in the statement of
financial position for each plan is determined as
the fair value of the plan
assets less the present value of the defined
benefit obligation at the end of the reporting
period. The defined benefit obligation and cost
of providing benefits is calculated annually by
independent actuaries using the projected unit
credit method. This is done separately for each
major plan by estimating the amount of future
benefits that employees have earned in return for
their service in the current and prior periods. The
present value of the defined benefit obligation
is determined by discounting the estimated
future cash outflows using interest rates of high-
quality corporate bonds denominated in the
currency in which the benefits will be paid, and
that have terms approximating the terms of the
related obligations. In countries where there is no
deep market in such bonds, the market rates for
government bonds are used.
Defined benefit plan surpluses are recognised
only to the extent that they are recoverable by
way of either reduced future contributions to the
plan or a refund from the plan.
Service costs comprise current service costs
and past service costs. Current service cost is
the increase in the present value of the defined
benefit obligation resulting from employee
services in the current period. Changes in the
present value of the defined benefit obligation
resulting from plan amendments or curtailments
are recognised immediately in profit and loss as
past service costs.
The net interest expense is calculated by
applying the discount rate to the defined benefit
obligation and the fair value of plan assets.
This cost is included in financial expenses in
the consolidated statement of profit and loss.
Remeasurement gains and losses arising
from experience adjustments and changes in
actuarial assumptions are recognised in the
period in which they occur, directly in other
comprehensive income.
Pension and other post-employment
benefit plan costs
In 2025, net costs of EUR 25 million relating
to the Hempel Foundation Group’s pension
and other post-employment benefit plans
were recognised in the statement of profit and
loss (2024: EUR 25 million) as shown in the
table below.
Pension costs (EUR m) 2025 2024
Costs for defined contribution plans:
Employee costs 23 22
Costs for defined benefit plans:
Employee costs 1 2
Interest expense 1 1
Total costs recognised in the profit and loss 25 25
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(EUR m) 2025 2024
Present value of obligation at 1 January 52 50
Current service cost 1 2
Interest expense 2 2
Actuarial (gains) losses arising from changes in financial assumptions - 1 - 1
Actuarial (gains) losses arising from experience adjustments - 2
Exchange differences - 3 -
Benefit payments from employer - 2 - 2
Payments from the plans - 3 - 1
Present value of obligation at 31 December 46 52
Fair value of plan assets at 1 January 35 32
Calculated interest on plan assets 1 1
Return on plan assets excluding calculated interest - 2
Exchange differences - 1 -
Employer contributions - 1
Payments from the plans - 3 - 1
Fair value of plan assets at 31 December 32 35
Surplus (deficit) at 31 December - 14 - 17
Effect of asset ceiling - 1 - 1
Net benefit asset (liability) at 31 December - 15 - 18
Represented by amounts recognised in the statement of financial position:
Asset recognised 5 4
Liability recognised - 20 - 22
Net benefit asset (liability) - 15 - 18
The defined benefit obligation may be analysed as follows:
Funded plans - 26 - 30
Unfunded plans - 20 - 22
Defined benefit obligation - 46 - 52
The defined benefit obligation may be analysed as follows:
Pension plans - 28 - 32
Other post-employment benefit plans - 18 - 20
Defined benefit obligation - 46 - 52
3.6 Pensions and other post-employment benefit obligations — continued
Hempel Foundation defined benefit plans
The Hempel Foundation Group operates defined
benefit plans in several countries with the major
plans being pensions in Ireland and the UK.
None of the plans are individually significant to
the Hempel Foundation Group .
The pension plans are generally final salary
plans, which provide benefits in the form of a
guaranteed level of pension payable for life.
The level of benefits provided typically depends
on the employees’ length of service and their
salary in the final years leading up to retirement.
The majority of the defined benefit obligation
relates to plans that are funded. However, there
are also a number of unfunded plans in which
the Hempel Foundation Group meets the benefit
payment obligation as it falls due. Recognition of
plan assets for the UK defined benefit pension
plan is restricted, as the surplus in the plan may
not ultimately be recoverable by the Hempel
Foundation Group.
Plan assets held in trusts are governed by local
regulations and practice in the relevant country,
as is the nature of the relationship between
the Hempel Foundation Group and the trustee
boards and their composition.
The Hempel Foundation Group also operates
a number of other post-employment benefit
plans which are primarily unfunded and typically
provide a lump sum payment on leaving
employment.
Movements in the present value of the defined
benefit obligations and the fair value of the plan
assets during the year are shown in the table to
the right.
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3.6 Pensions and other post-employment benefit obligations — continued
Of the total defined benefit obligation, 51%
(2024: 50%) relates collectively to pension
plans in Ireland and the UK.
The expected average duration of the defined
benefit obligations is 10 years (2024: 10 years)
and the expected employer contributions
for the year ending 31 December 2026 are
EUR 2 million.
The composition of plan assets is shown in
the table below.
Mortality rates are also a key assumption; in
each country the most common demographic
assumptions, including mortality rates,
are applied.
Sensitivity analysis
The following table illustrates the change
in the defined benefit obligation related to
defined benefit plans due to a change in the key
actuarial assumptions. The analysis is based on
reasonably possible changes, provided that the
other parameters remain unchanged.
The following table summarises the key
assumptions of the defined benefit plans.
Recognised defined benefit pension obligation (EUR m) 2025 2024
Discount rate:
Increase of 0.5 percentage points - 2 - 2
Decrease of 0.5 percentage points 2 3
Future wage / salary increase
Increase of 0.5 percentage points 1 1
Decrease of 0.5 percentage points - 1 - 1
Mortality
Increase of 1 year - -
Decrease of 1 year - -
Defined benefit plan assets by category (%) 2025 unquoted 2025 quoted 2025 2024
Cash and cash equivalents - 9% 9% 1%
Equity instruments 6% 10% 16% 21%
Debt instruments 3% 54% 57% 57%
Real estate 1% - 1% 1%
Investment funds - 6% 6% 9%
Assets held by insurance company 10% - 10% 9%
Other 1% - 1% 2%
Total 21% 79% 100% 100%
% 2025 2024
Weighted discount rate 4.73% 4.55%
Future wage / salary increase 3.53% 3.60%
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3.7 Provisions
Accounting policies
Provisions are recognised when the Hempel
Foundation Group has a present legal or
constructive obligation as a result of past events,
it is probable that an outflow of resources will be
required to settle the obligation, and the amount
can be reliably estimated.
Provisions for environmental, warranty and
restructuring obligations, as well as other
obligations, are measured at the present value of
management’s best estimate of the expenditure
required to settle the present obligation at the
end of the reporting period. The costs required
to settle the liability are discounted if the effect
is material to the measurement of the provision.
The discount rate used to determine the present
value is a pre-tax rate that reflects current market
assessments of the time value of money and the
risks specific to the liability. The increase in the
provision due to the passage of time is recognised
as interest expense.
Decommission and restoration obligations are
measured at the present value of the future liability
in respect of decommissioning as expected
at the balance sheet date. The present value
of the provision and changes in estimate are
recognised as part of the cost of property, plant
and equipment and depreciated together with
the associated asset.
Interest on provisions is recognised in the statement
of profit and loss under financial expenses.
Environmental provisions
Environmental obligations relate to restoration
of various sites and to remedying established
environmental damages that occurred in
connection with the production of coatings
and disposal or release of certain wastes.
Management anticipates that the resolution of
the Hempel Foundation Group’s environmental
obligations will occur over an extended period, in
some cases over a period of more than 5 years.
Warranties
Provision is made for estimated warranty claims
in respect of products sold that are still under
warranty at the end of the reporting period.
Warranty cases are normally resolved within 0-5
years, though some complex cases are resolved
over an extended period of more than 5 years.
In line with accounting policies, potential product
warranties are recognised as warranty provisions
when revenue from the related sale is recognised.
Other provisions
Restructuring provisions are recognised when
a detailed formal plan exists which identifies
the affected part of the business, the number of
affected employees and approximate timeline,
and the employees affected have been notified
of the main features of the plan. The Hempel
Foundation Group is involved in a number of legal
cases, tax cases and other disputes. Some of
these involve significant amounts and are subject
to some uncertainty. Management continuously
assesses the risks associated with the cases and
disputes, and their likely outcome. It is the opinion
of management that, apart from items recognised
in the financial statements, the outcomes of
these cases and disputes are not probable or
cannot be reliably estimated in terms of amount
or timing. The Hempel Foundation Group does
not expect these to have a material impact on the
consolidated financial statements.
(EUR m) Environmental
obligations
Warranties Other
provisions
Total
Total provisions, beginning of year 20 36 20 76
Exchange adjustment at year-end rate - 1 - 2 - - 3
Additions for the year - 12 14 26
Reversed for the year - 1 - 8 - 9 - 18
Consumed for the year - 1 - 7 - 4 - 12
Unwinding of provision 1 - - 1
Total provisions, end of year 18 31 21 70
Current liabilities 1 12 10 23
Non-current liabilities 17 19 11 47
Total provisions, end of year 18 31 21 70
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3.8 Other liabilities
Accounting policies
Other liabilities mainly comprise accrued
employee costs, fund contributions, including
bonuses, withholding tax and VAT, customer
bonuses, commission payables, accrued
interests and prepaid rent.
Not yet settled donations total EUR 57 million.
(2024: EUR 62 million).
Other financial liabilities are measured at initial
recognition at fair value. Subsequently, other
financial liabilities are measured at amortised
cost using the effective interest method, which
usually corresponds to the nominal value.
Other non-financial liabilities arising from, e.g.
taxation or employer benefits, are measured in
accordance with the appropriate standards.
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4 Capital structure and financing items
Accounting policies
Dividends proposed by management for the year
are presented separately within equity.
The translation reserve comprises foreign
exchange differences arising from the
translation to EUR of financial statements of
the parent Foundation and its subsidiaries.
Also, the effect of the inflation adjustment from
hyperinflationary economies is recognised
within the translation reserve.
The cash flow hedge reserve covers cash flow
hedging of interest rates associated with loans
and borrowings.
Base capital
The base capital of the Hempel Foundation
Group amounts to DKK 35 million.
Grants
Grants are recognised in equity when the
Hempel Foundation Group is obligated towards
the recipient of the grants. From that point in
time and until the grants have been paid out, the
donation is classified as other liabilities.
Capital structure
The capital structure of the Hempel Foundation
Group is intended to ensure sufficient financial
flexibility and stability for the Hempel Foundation
Group to reach its strategic goals. The Hempel
Foundation Group aims to maintain an optimal
capital structure, and to use the free operating
cash flow after financial items and tax for debt
servicing, business development and grants.
The Hempel Foundation Group strives to ensure
adequate credit resources at all times, which
includes securing access to committed bank
financing and refinancing maturing debt in a
timely manner.
Capital resources and covenants
The Hempel Foundation Group strives to ensure
adequate credit resources at all times, which
includes securing access to committed bank
financing and refinancing maturing debt in a
timely manner.
The Hempel Foundation Group aims to have
minimum EUR 250 million of free committed
credit resources available for the next 12 months.
In order to achieve this overall objective,
the Hempel Foundation Group’s capital
management aims to ensure that it meets
its financial covenants attached to the
interest-bearing loans and borrowings that
define capital structure requirements. The
covenants, which the Hempel Foundation
Group is required to comply with quarterly,
state that the Hempel Foundation Group’s
leverage must not exceed 4.0x. The Hempel
Foundation Group’s leverage is defined in note
5.7 Financial definitions.
At the end of 2025, the leverage ratio was 0.8x
(2024: 1.3x). The Hempel Foundation Group
aims to maintain a leverage ratio below 2.5x in
the long term while a higher leverage ratio is
accepted when acquiring strategic businesses.
Breaches in meeting the financial covenants
would permit the bank to immediately call loans
and borrowings. There have been no breaches,
nor close to defaults, of the financial covenants of
any interest-bearing loans or borrowings in the
current period or in the previous period.
No changes were made in the objectives,
policies or processes for managing capital during
2025 or 2024.
4.1 Base capital and grants
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4.2 Borrowings
Accounting policies
Long-term loans, such as loans from credit
institutions, are recognised initially at fair
value net of directly attributable transaction
costs. Subsequently, the loans are measured
at amortised cost using the effective interest
method. The difference between the proceeds
initially received and the nominal value is
recognised as financial expenses in the
statement of profit and loss over the loan term.
The bank loans are floating interest loans based
mainly on EURIBOR. Further, the interest rate
is linked to the Hempel Foundation Group’s
leverage ratio.
A negative pledge clause is attached tothe
Hempel Foundation Group’s long-term loan
arrangements that prevents the Hempel
Foundation Group from pledging certain assets
as security.
Secured loans
Lease liabilities are effectively secured as the
rights to the leased assets recognised in the
financial statements revert back to the lessor in
the event of default.
The Hempel Foundation Group’s borrowings
consist of the following:
2025 (EUR m) Average
interest rate
Maturity Carrying
amount
Bank loans 2.92% 2027-2030 384
Overdraft facilities 2.80% 2026 43
Lease liabilities 0.4%-16.1% 2026-2047 84
Total borrowings 511
Current 67
Non-current 444
Total borrowings 511
2024 (EUR m) Average
interest rate
Maturity Carrying
amount
Bank loans 0.0352 2026-2027 582
Overdraft facilities 0.0346 2025 76
Lease liabilities 0.2%-13.1% 2025-2047 96
Total borrowings 754
Current 105
Non-current 649
Total borrowings 754
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4.3 Financial risks
This note describes the exposure to financial
risks and how these risks could affect the Hempel
Foundation Group’s future financial performance.
The Hempel Foundation Group’s activities
expose the Hempel Foundation Group to a
variety of risks related to the Hempel Foundation
Group’s financial assets and liabilities. The
Hempel Foundation Group’s financial liabilities
comprise primarily borrowings, trade and
other payables and lease liabilities, whereas
the financial assets primarily comprise trade
receivables and cash deposits.
Management has assessed the following key
financial risks and their significance to the
Hempel Foundation Group:
The above financial risks are inherent to the way
the Hempel Foundation Group operates as a
global group with a large number of operating
units across the world. The Hempel Foundation
Group’s overall risk management programme
seeks to identify, assess, and mitigate these
financial risks in order to reduce the effects on the
Hempel Foundation Group’s financial performance.
The risks are managed in accordance with the
policies and guidelines laid out by the Board of
Directors. The Hempel Foundation Group has
centralised handling of these risks, except for
commercial credit risk, which is managed locally.
There are no changes in the Hempel Foundation
Group’s financial risk management policies
compared to the previous year.
It is the Hempel Foundation Group’s policy not to
speculate actively on financial risks.
To some extent, the Hempel Foundation Group’s
income and expenses in foreign currencies net
out and create a natural hedge of the Hempel
Foundation Group’s profitability margin. The
Hempel Foundation Group hedges intercompany
loans in the major currencies using financial
instruments. Foreign exchange hedges are
entered into in order to mitigate foreign exchange
risks related to internal balances between Group
entities. See further description under market risk.
Market risk
The Hempel Foundation Group’s exposure
to market risks is related to foreign exchange
risks and interest rate risk. All market risks
are managed in accordance with the Hempel
Foundation Group’s Treasury Policy.
Foreign exchange risk
Foreign exchange risk is the risk that the fair
value or future cash flows of a balance sheet
exposure will fluctuate because of changes in
foreign exchange rates.
The Hempel Foundation Group’s exposure to
the risk of changes in foreign exchange rates
relates primarily to the Hempel Foundation
Group’s trade receivables and trade payables,
arising respectively from revenue and purchase
transactions denominated in a foreign currency
and intercompany loans and deposits. The
currency exposure in these balances may affect
the Hempel Foundation Group’s result.
The overall objective of foreign exchange risk
management is to reduce the short-term negative
impact of exchange rate fluctuations on net
financials and cash flows, thereby contributing to
the predictability of the financial results.
To manage exposure to foreign exchange risk, it
is the Hempel Foundation Group’s policy to pool
funding activities centrally through intercompany
loans and deposits. In each subsidiary, foreign
exchange risk derived from trade receivables or
payables is mitigated by the Hempel A/S Group
establishing an intercompany loan/receivable
towards the local entity in the same foreign
currency, thereby creating a natural hedge.
Currency risk is, as a main policy, hedged against
DKK or EUR when exposure exceeds EUR 0.5
million (higher thresholds are applied for US,
SGD, HKD and PLN). Some currencies cannot
be hedged within a reasonable price range, in
which case correlation to a proxy currency is
considered and, if deemed appropriate, proxy
hedging is applied.
Foreign exchange forward contracts are used to
hedge the exposure to currency risk. As the vast
majority of intercompany loans are hedged, and
because changes in the fair value of both the
hedged item and the foreign exchange forward
is recognised in profit and loss under financial
items, the net exposure to foreign currency risk is
deemed low, though a higher foreign exchange
risk persists in countries with high inflation.
Foreign currency sensitivity
The sensitivity analysis is based on financial assets
and liabilities recognised as of 31 December.
The table on the next page demonstrates the
sensitivity to a reasonably possible change in
USD and GBP exchange rates against EUR, with
all other variables held constant. The Hempel
Foundation Group’s exposure to foreign currency
changes for all other currencies is not material.
The impact on the Hempel Foundation Group’s
profit before tax is due to changes in the fair value
of monetary assets and liabilities denominated
in foreign currencies and non-designated foreign
exchange derivatives. Although the derivatives
have not been designated in a hedge relationship,
they act as an economic hedge and will offset the
underlying transactions when they occur.
The movement in pre-tax equity equals the
effect on profit before tax adjusted for fair value
movements of interest rate swaps designated as
hedging instruments.
Financial risk type 2025 2024
Foreign exchange risk Low Low
Interest rate risk Low Low
Credit risk Low Low
Liquidity risk Low Low
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Interest rate risk
The Hempel Foundation Group’s exposure
to changes in interest rates primarily relates
to long-term loans and borrowings with
floating interest rates. The Hempel Foundation
Group’s policy is to hedge its interest rate risk
depending on the Hempel Foundation Group’s
interest coverage level (EBITDA/interest).
When the Hempel Foundation Group’s interest
coverage level falls below 10, the Hempel
Foundation Group assesses whether it is
necessary to mitigate the interest rate risk by
entering into hedging instruments.
The Hempel Foundation Group has fixed the
interest rate on EUR 200 million of debt by
entering variable-to-fixed interest rate swaps
maturing in December 2026, which reduces the
exposure to changes in interest rates in 2026.
The interest related to the EUR 200 million
debt is fixed at an interest rate of 2.31% until
December 2026.
There is an economic relationship between the
loans and the hedging instruments as both the
nominal amount and terms of the interest rate
swaps mirror the hedged exposure, creating
an equal opposite interest receipt and a fixed
interest payment. The Hempel Foundation
Group has established a hedge ratio of 1:1 for
the hedging relationships as the underlying risk
of the interest rate swaps are identical to the
hedged risk.
The table above demonstrates sensitivity to
reasonable possible changes in interest rates,
with all other variables held constant.
The sensitivity analysis is based on financial
assets and liabilities recognised as of
31 December and assumes that the interest
rate hedges are 100% effective. The sensitivity
analysis is based on a change of 100 bps which
is considered a reasonable possible change at
31 December 2025.
Credit risk
Credit risk arises from the possibility that
trading partners or customers may default on
their obligations, causing financial losses for
the Hempel Foundation Group. The Hempel
Foundation Group is exposed to credit risk on
cash, trade and other receivables. Please refer
to note 3.5 for a description of the Hempel
Foundation Group’s credit risk in relation to
trade receivables.
4.3 Financial risks — continued
(EUR m) Increase/
decrease in bps
Effect on profit
before tax
Effect on equity
2025
Euro +100 bps - 0.2 - 0.1
Euro - 100 bps 0.2 0.1
2024
Euro +100 bps 0.8 0.6
Euro - 100 bps - 0.8 - 0.6
(EUR m) Change in rate Nominal value Effect on profit
before tax
Effect on equity
2025
USD/EUR 5% 15.3 0.8 0.6
USD/EUR - 5% 15.3 - 0.8 - 0.6
2025
GBP/EUR 5% 10.2 0.5 0.5
GBP/EUR - 5% 10.2 - 0.5 - 0.5
2024
USD/EUR 5% - 47.7 - 2.4 - 1.9
USD/EUR - 5% - 47.7 2.4 1.9
2024
GBP/EUR 5% 14.1 0.7 0.6
GBP/EUR - 5% 14.1 - 0.7 - 0.6
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4.3 Financial risks — continued
The carrying amount of EUR 224 million (2024:
EUR 273 million) represents the maximum credit
exposure related to cash and other receivables.
The Hempel Foundation Group main banks are
all financial institutions with a high credit rating
and, therefore, financial assets such as cash are
considered to be of low risk.
Other financial assets measured at amortised
cost comprise other receivables. These financial
assets are considered to have a low credit risk,
and thus the impairment provision calculated
based on 12 months of expected losses is
considered immaterial. The financial assets
are considered to be low risk when they have a
low risk of default, and the issuer has a strong
capacity to meet its contractual cash flow
obligations in the near term.
The Hempel Foundation Group has no material
risks relating to a single customer or business
partner. It is the Hempel Foundation Group’s
credit policy to rate major customers and other
business partners on a current basis.
Bank Acceptance Bills are used as a financial
instrument to further limit the risk of credit losses.
The Hempel Foundation Group considers a
financial asset in default when Hempel A/S Group
is unlikely to recover the outstanding contractual
amount in full. A financial asset is written off when
there is no reasonable expectation of recovering
the contractual cash flows.
Liquidity risk
The liquidity risk is assessed to be low.
The Hempel Foundation Group ensures the
availability of the required liquidity through a
combination of cash management and both
uncommitted and committed credit facilities.
The Hempel Foundation Group applies cash
pool arrangements for optimisation and
centralisation of cash management.
The Hempel Foundation Group has an undrawn
credit facility of EUR 528 million (2024: EUR
454 million).
Maturities of financial liabilities
The table to the right provides an analysis of
the Hempel Foundation Group financial liabilities
divided into relevant maturity groupings based
on their contractual maturities for non-derivative
financial liabilities.
The amounts disclosed in the table are the
contractual undiscounted cash flows.
Maturity debt
Contractual undiscounted cash flows (EUR m)
Less than
1 year
Between
1 and 5 years
More than
5 years
2025
Non-derivatives:
Borrowings, current and non-current 54 382 31
Trade payables 304 - -
Lease liabilities 28 49 8
Derivatives:
Derivatives financial instruments 1 - -
Total contractual undiscounted cash flows at the end of the year 387 431 39
Non current liabilities 470
Current liabilities 387
2024
Non-derivatives:
Borrowings, current and non-current 94 561 -
Trade payables 317 - -
Lease liabilities 32 53 15
-
Derivatives: -
Derivatives financial instruments 1 - -
Total contractual undiscounted cash flows at the end of the year 444 614 15
Non current liabilities 629
Current liabilities 444
For borrowings, the contractual payments are based on the variable interest rates at December 2023, except for a total of EUR 700
million in loans for which the fixed interest swap rates are applied until the swap rates mature in December 2025, thus reflecting the
Hempel Foundation Group’s expected net cash outflow until maturity of the loan and the interest rate swaps.
Hempel Foundation Annual Report 2025
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4.4 Financial instruments
Accounting policies
Derivative financial instruments, foreign
exchange forwards, currency swaps and interest
rate swaps are initially recognised in the balance
sheet at fair value and subsequently remeasured
at their fair value.
Derivatives are used for economic hedging
purposes and not as speculative investments.
Where the derivatives do not meet the hedge
accounting criteria, they are measured at fair
value through profit and loss.
Hedging instruments not qualifying for hedge
accounting
For foreing exchange forwards and currency
swaps, positive and negative fair values of these
derivative financial instruments are recognised
as Other receivables and Other payables,
respectively. Changes in the fair values of foreign
exchange forwards and currency swaps are
recognised in the statement of profit and loss
under financial income and expenses.
Cash flow hedge accounting
For interest rate swaps, cash flow hedge
accounting is applied. Positive and negative
fair values are recognised as Other receivables
and Other payables, respectively. Changes in
the fair values are recognised directly within
Other comprehensive income. The amount
accumulated in equity is reclassified to profit and
loss as a reclassification adjustment in the same
periods during which the hedged cash flows
affect profit and loss. Fair value of the interest
rate swaps was negative EUR 0.5 million as of
31 December 2025 (2024: EUR 2.0 million).
Financial instruments, fair value disclosures
The carrying amount of financial instruments
is a reasonable approximation of the fair value,
except for loans measured at amortised cost.
The carrying amount of loans measured at
amortised cost amounted to EUR 427 million
(2024: 658 million) compared to a fair value of
EUR 426 million (2024: 623 million). The fair
value is determined based on the present value
of expected future cash flows.
The carrying amount of lease liabilities amounted
to EUR 84 millions (2024: 96 million) compared
to a fair value EUR 84 million (2024: 96 million).
Financial instruments measured at fair value
Fair value measurement of financial intruments is
categorised into a hierarchy based on the inputs
used in the valuation process. The hierarchy
consists of three levels:
Level 1 — Quoted prices (unadjusted) in active
markets for identical assets or liabilities.
Level 2 — Inputs other than quoted prices
included within level 1 that are observable for the
asset or liability, either directly (i.e. as prices) or
indirectly (i.e. derived from prices).
Level 3 — Inputs for the asset or liability that are
not based on observable market data.
Foreign exchange contracts, currency swaps
and interest rate swaps are within level 2 of the
fair value hierarchy and are calculated based
on observable market data, such as foreign
exchange rates and yield curves at the end of
the reporting period, and generally accepted
valuation methods. Loans are with level 3 of the
fair value hierarchy.
Fair value of investments in private
equity funds
The consolidated Hempel Foundation Group has
committed a total investment of EUR 70 million
in other securities (2024: EUR 75 million). As of
31 December 2025, the remaining commitment
was EUR 28 million (2024: EUR 35 million).
Reconciliation of liabilities arising from
non-cash movements
Financing activities (EUR m)
Beginning of
the year
Cash flows Additions Disposals Acquisitions Exchange rates
etc.
End of
the year
2025
Lease liabilities 96 - 33 30 - 2 - - 7 84
Borrowings, current and non-current 658 - 231 - - - - 427
Liabilities arising from financing activities 754 - 264 30 - 2 - - 7 511
2024
Lease liabilities 101 - 32 31 - 7 - 3 96
Borrowings, current and non-current 1,126 - 470 - - 2 658
Liabilities arising from financing activities 1,227 - 502 31 - 7 - 5 754
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4.5 Financial income and expenses4.4 Financial instruments — continued
Accounting policies
Financial income and expenses comprise
interest income and expenses, gains and losses
on receivables, payables, realised and unrealised
exchange gains and losses on transactions
denominated in foreign currencies.
Other securities and equity interests consist of
investments in private equity funds (fair value
hierarchy level 3). For this type of investment, fair
value is not measured based on observations in an
active market but based on information about fair
value provided by the private equity funds. When
entering into new investments in private equity
funds, the Hempel Foundation Group receives
information about the funds’ general valuation
principles, which are accepted simultaneously
with the Hempel Foundation Group’s decision
to invest in a private equity fund. The fair value
of the Hempel Foundation Group’s investments
in private equity funds is based on the latest
received quarterly and annual statements,
adjusted for cash calls and distributions in the
period between the date of the latest received
report and the balance sheet date.
The valuation of all investments is based on
unobservable inputs. Recognition is based
on the formalised valuation reporting process
implemented at the private equity fund. Detailed
information about the valuation model’s data
and underlying assumptions is not received.
Financial income (EUR m) 2025 2024
Interest income 7 21
Gain on derivative financial instruments at fair value through profit and loss - 16
Fair value adjustment transferred from equity hedge reserve - 3
Net monetary gain - 2
Income from investments in other financial assets 13 6
Realised and unrealised gain on securities 22 25
Other financial gains 21 1
Total financial income 63 74
Financial expenses (EUR m) 2025 2024
Interest expense on borrowings - 20 - 55
Interest expense on lease liabilities - 4 - 4
Interest expenses on financial liabilities measured at amortised cost - 24 - 59
Realised and unrealised losses on securities - - 11
Foreign exchange loss (net) - 49 - 20
Net monetary loss - -
Loss on derivative financial instruments at fair value through profit and loss - 1 -
Fair value adjustment transferred from equity hedge reserve - 2 -
Other financial expenses - 37 - 16
Total financial expenses - 113 - 106
Gains and losses on foreign exchange derivative financial instruments measured at fair value through profit and loss have been
presented separately.
Other financial assets
Investment category (EUR m)
Fair value
hierarchy level
Fair value as of
31 December
Net revaluation
recognised through
profit and loss
2025
Bonds (listed) 1 52 -
Shares (listed) 1 382 4
Other investments (listed) 1 6 -
Shares non-listed 2 - -
Other investments (non-listed) 3 55 -
Total 495 4
2024
Bonds (listed) 1 56 1
Shares (listed) 1 387 4
Other investments (listed) 1 3 -
Shares non-listed 2 4 1
Other investments (non-listed) 3 57 4
Total 507 10
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4.6 Discontinued operations
Divestment of the Decorative business in
France and Germany
The divestment of the Hempel Foundation
Group’s Decorative business in France and
Germany to Fidelium Partners was completed
on 1 August 2024. The business was reported
as a discontinued operation up to the date of
disposal. Certain adjustments relating to this
divestment are included in the 2025 data in
these tables.
Divestment of Hempel Russia
The divestment of Hempel Russia was
completed on 13 July 2023. The associated
operations were presented as discontinued
operations up to the date of disposal.
The carrying amounts of assets and liabilities as of the date of sale were:
Net loss from discontinued operations (EUR m) 2025 2024
Revenue - 94
Production costs - - 76
Sales and distribution costs - - 21
Administrative costs - - 7
Financial income and expenses - - 9
Net loss before tax from operating activities - - 19
Income tax - -
Net loss after tax from operating activities - - 19
Loss on sale of Decorative business in France and Germany 2 - 75
Loss on sale of Hempel Russia - 4
Net loss from discontinued operations (attributable to the shareholders of Hempel A/S) 2 - 90
Cash flow from discontinued operations (EUR m) 2025 2024
Cash flow from operating activities - 1 - 12
Cash flow from investing activities - 2 4
Total - 3 - 8
Loss on sale of Decorative business in France and Germany and
Hempel Russia (EUR m)
2025 2024
Net cash received - 2 4
Net proceeds receivables/payables 5 - 5
Total consideration received or receivable 3 - 1
Carrying amount of net assets sold - - 58
Reclassification of foreign currency translation reserve - -
Carrying amount of buildings sold - - 8
Transaction costs - 1 - 3
Total loss on sales of Decorative business in France and Germany and Hempel Russia 2 - 70
(EUR m) 2024
Non-current assets 33
Inventory 30
Trade recievables 49
Cash 1
Other current assets 6
Total assets 119
Non-current liabilities - 8
Trade payables - 29
Other current liabilities - 24
Total liabilities - 61
Net assets 58
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5 Other disclosures
Fees for services other than statutory audit
of the financial statements provided by
PricewaterhouseCoopers Statsautoriseret
Revisionspartnerselskab to the Hempel
Foundation Group mainly consist of financial due
diligence and transaction advice, accounting
advisory services, and other advisory and
tax services.
Contingent liabilities
The Hempel Foundation Group has an
unrecognised latent tax liability amounting to
EUR 11.7 million (2024: EUR 0 million). The tax
liability relates to tax provisions for future grants.
The Hempel Foundation Group expects to
neutralise this tax liability through future grants,
which is why the latent liability is not recognised.
Other commitments
The Hempel Foundation Group has committed
a total of EUR 70 million investment in other
securities. As of 31 December 2025 the
remaining commitment is EUR 28 million.
For the purpose of presenting the statement of
cash flows, non-cash items with effect on the
statement of profit and loss must be reversed
to identify the actual cash flow effect from the
statement of profit and loss. The adjustments are
specified as follows:
5.1 Fee to the auditors appointed at the General Meeting 5.3 Contingent liabilities and other commitments
5.2 Adjustment for non-cash items
(EUR m) 2025 2024
Audit fee 2 2
Tax advice 1 1
Other fees - -
Total 3 3
(EUR m) 2025 2024
Amortisation, depreciation and impairment 105 116
Other non-cash adjustments - 1
Provisions - 21
Gains and losses on the sale of fixed assets - 11 71
Hyperinflation adjustments 4 -
Total 98 209
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5.5 Related parties
Related parties Basis
Hempel’s Employee Foundation, Amaliegade 8, 1256 Copenhagen K, Denmark Related party
Fonden J.C. Hempel Glasmuseum, Amaliegade 8, 1256 Copenhagen K, Denmark Related party
Hempel’s Employee Foundation of 2017, Amaliegade 8, 1256 Copenhagen K, Denmark Related party
Subsequent events
After the balance sheet date, Hempel
Ejendomme A/S acquired two nature sites to
further expand our work within nature restoration
in Denmark: Nørholm Gods and the Mols
Laboratory. These acquisitions are not expected
to materially impact the financial result of the
Hempel Foundation Group.
No other events occurred after the balance
sheet date that could have a material impact on
the company’s financial results, assets, liabilities
or equity.
5.4 Events after the reporting period
Transactions (EUR t) 2025 2024
The Hempel Foundation Group had the following transactions with related parties,
(income)/expense:
Hempel’s Employee Foundation,
Amaliegade 8, 1256 Copenhagen K, Denmark
Administrative services provided by the Hempel Foundation Group 14 14
Fonden J.C. Hempel Glasmuseum,
Amaliegade 8, 1256 Copenhagen K, Denmark
Administrative services provided by the Hempel Foundation Group 20 20
Hempel’s Employee Foundation of 2017,
Amaliegade 8, 1256 Copenhagen K, Denmark
Administrative services provided by the Hempel Foundation Group 14 14
All related-party transactions were carried out at arm’s length.
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5.6 The Hempel Foundation Group
Location Name Currency Ownership
Denmark Hempel Ejendomme A/S DKK 100%
Denmark Hempel Invest A/S DKK 100%
Hempel Invest A/S
Denmark Hempel Invest II ApS DKK 100%
Denmark Hempel Administration ApS DKK 100%
Denmark Keldskov ApS DKK 100%
Denmark Brænderupvænge ApS DKK 100%
Denmark Hempel A/S DKK 78%
Hempel A/S
Argentina Hempel Argentina S.R.L. ARS 100%
Australia Hempel (Australia) Pty. Ltd. AUD 100%
Australia Hempel NewCo (Australia) Pty. Ltd. AUD 100%
Australia Hempel (Wattyl) Australia Pty. Ltd. AUD 100%
Bahrain Dahna Paint Middle East Holding B.S.C. BHD 51%
Bahrain Hempel Paints (Bahrain) S.P.C. BHD 51%
Brazil Hempel Tintas do Brasil Ltda BRL 100%
Canada Farrow & Ball Canada Limited CAD 100%
Canada Hempel (Canada) Inc. CAD 100%
Chile Pinturas Hempel Chile SpA CLP 100%
China Hempel North Asia Holding Co., Ltd CNY 100%
China Hempel (Hong Kong) Limited HKD 100%
China Hempel (China) Limited HKD 100%
China Hempel (Kunshan) Coatings Ltd. CNY 100%
China Hempel (Yantai) Coatings Ltd. CNY 100%
China Hempel (Guangzhou) Coatings Ltd. CNY 100%
China Hempel (Zhangjiagang) Coatings Ltd. CNY 100%
Croatia Hempel Coatings (Croatia) Ltd. EUR 100%
Cyprus Hempel Coatings (Cyprus) Limited EUR 100%
Czech Republic Hempel (Czech Republic) s.r.o. CZK 100%
Denmark HSA (Danmark) A/S DKK 100%
Denmark Hempel Decorative Paints A/S DKK 100%
Denmark HF (Denmark) A/S DKK 100%
Location Name Currency Ownership
Hempel A/S — continued
Ecuador Hempel Ecuador S.A. USD 100%
Egypt Hempel Coatings (Egypt) LLC EGP 100%
Egypt Hempel Egypt L.L.C. EGP 100%
Egypt Hempel Paints Egypt LLC EGP 99%
Finland OY Hempel (Finland) AB EUR 100%
France Hempel (France) SAS EUR 100%
Germany Farrow & Ball DE GmbH EUR 100%
Germany Hempel (Germany) GmbH EUR 100%
Germany Hempel Beteiligungsgesellschaft GmbH EUR 100%
Germany Rottkamp Immobilien Verwaltung GmbH EUR 100%
Greece Hempel Coatings (Hellas) Single Member S.A. EUR 100%
India Hempel Paints (India) Private Limited INR 100%
Indonesia P.T. Hempel Indonesia IDR 100%
Ireland Crown Paints Ireland Limited EUR 100%
Italy Hempel (Italy) S.r.l. EUR 100%
Korea Hempel Korea Co. Ltd. KRW 100%
Kuwait Hempel Paints (Kuwait) K.S.C.C. KWD 51%
Malaysia Hempel (Malaysia) Sdn. Bhd MYR 100%
Malaysia Hempel Manufacturing (Malaysia) Sdn. Bhd. MYR 100%
Mexico Pinturas Hempel de Mexico S.A. de C.V. MXN 100%
Morocco Hempel Maroc SARL MAD 100%
New Zealand Hempel (Wattyl) New Zealand Ltd. NZD 100%
Norway Hempel Norway AS NOK 100%
Oman Hempel (Oman) L.L.C OMR 25%
Oman Hempel Manufacturing LLC OMR 25%
Peru Hempel Pinturas Del Perú S.A.C. PEN 100%
Poland Hempel Paints (Poland) S.p. z o.o. PLN 100%
Portugal Hempel (Portugal) Lda EUR 100%
Qatar Hempel Paints (Qatar) W.L.L. QAR 28%
Saudi Arabia Hempel Paints (Saudi Arabia) W.L.L. SAR 51%
Singapore Hempel (Singapore) Pte. Ltd. SGD 100%
South Africa Hempel Paints South Africa (Pty) Ltd. ZAR 100%
Spain Pinturas Hempel SAU EUR 100%
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5.6 The Hempel Foundation Group — continued
Location Name Currency Ownership
Hempel A/S — continued
Sweden Hempel (Sweden) AB SEK 100%
Switzerland Hempel Schweiz AG CHF 100%
Syria Hempel Paints (Syria) W.L.L. SYP 43%
Taiwan Hempel (Taiwan) Co., Ltd. TWD 100%
Thailand Hempel (Thailand) Ltd. THB 100%
The Netherlands Hempel (The Netherlands) B.V. EUR 100%
Turkey Hempel Coatings San. ve Tic. Ltd. Sti. TRY 100%
UK Crown Brands Limited GBP 100%
UK Crown Paints Limited GBP 100%
UK Crown Paints Group Limited GBP 100%
UK Crown Paints Holdings Limited GBP 100%
UK FB Ammonite Limited GBP 100%
UK FB Brassica Limited GBP 100%
UK FB Brinjal Limited GBP 100%
UK FB Calluna Limited GBP 100%
UK Farrow & Ball Holding Limited GBP 100%
UK Farrow & Ball Limited GBP 100%
UK Hempel Decorative Paints Limited GBP 100%
UK Hempel UK Ltd. GBP 100%
UK Reebor Limited GBP 1%
United Arab Emirates Hempel Paints Company Abu Dhabi L.L.C. AED 24%
United Arab Emirates Hempel Paints Emirates L.L.C. AED 49%
USA Farrow & Ball Inc. USD 100%
USA Hempel (USA), Inc. USD 100%
USA Jones-Blair Company, LLC USD 100%
Vietnam Hempel Vietnam Company Limited VND 100%
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5.7 Financial definitions
Financial ratios have been calculated as follows:
Organic growth =
Organic revenue
Revenue in comparative period
Organic growth is defined as growth from one year to the next, based on values in fixed
currencies for both years excluding mergers, acquisitions and divestments, etc.
Gross margin =
Gross profit
Revenue
EBITDA margin =
EBITDA
Revenue
EBITDA margin, adjusted =
EBITDA, adjusted
Revenue
EBITDA = Operating profit (and loss) before impairment, amortisation and depreciation
EBITDA, adjusted = EBITDA before special items and before adjustment for hyperinflation according to IAS 29
Operating profit margin =
Operating profit (loss)
Revenue
Return on invested capital (ROIC) =
12 month operating profit less effective tax rate + special items
(∑
i=T
Invested capital) / 12
i=T–12
Invested capital =
Intangibles + property, plant and equipment + inventories + receivables
– provisions – trade payables – other payables
Equity ratio =
Shareholders’ equity
Total assets
Leverage ratio =
Net interest-bearing debt
EBITDA before special items (incl. full-year figures from acquisitions)
Net interest-bearing debt =
Overdraft facilities + bank loans, etc. + interest-bearing payables to Group enterprises
+ lease liabilities - cash at bank and in hand
Free cash flow = Total net cash generated from operating activities less net cash used in investing activities
Cash conversion =
Total net cash flows from operating activities before financial items and tax
Total EBITDA
Financial ratios have been calculated as follows:
Accounts receivable days =
Accounts receivable x 90
Revenue (last 3 months)
Accounts payable days =
Accounts payable x 90
Cost of goods sold + change in inventory (last 3 months)
Inventory days =
Inventory x 90
Cost of goods sold (last 3 months)
Average net working capital days = Accounts receivable days + inventory days – accounts payable days (12 months average)
The following key figures are calculated as follows (EUR m) 2025 2024
Operating profit 280 279
Amortisation, depreciation and impairment 105 112
EBITDA = 385 391
Special items, c.f. note 2.4 3 -
Adjustment for hyperinflation according to IAS 29 4 1
EBITDA, adjusted = 392 392
The following key figures are calculated as follows:
Borrowings 427 658
Lease liabilities 84 96
Cash - 180 - 229
Net interest-bearing debt = 331 525
EBITDA, adjusted 392 392
Adjustment for hyperinflation according to IAS 29 - 4 - 1
EBITDA before special items = 388 391
Leverage ratio = 0.9 1.3
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements 97PhilanthropyIntroduction Engaged ownership Financial statements
Consolidated
financial statements
Hempel Foundation financial statements
Primary statements
Key figures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
Income statement
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
Balance sheet
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
Statement of changes in equity
. . . . . . . . . . . . . . . . . . . . . . . . . . 102
Notes
1. Basis of preparation
1.1 General accounting policies
. . . . . . . . . . . . . . . . . . . . . . . . . 103
2. Results for the year
2.1 Revenue
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
2.2 Employee costs
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
2.3 Income from investments in subsidiaries
. . . . . . . . . . . . . . 106
2.4 Income tax
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106
3. Operating assets and liabilities
3.1 Property, plant and equipment
. . . . . . . . . . . . . . . . . . . . . . 107
3.2 Other securities and investments
. . . . . . . . . . . . . . . . . . . . 108
3.3 Prepayments
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
3.4 Receivables
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109
4. Capital structure and financing items
4.1 Base capital
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
4.2 Financial risks
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
4.3 Net financials
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
4.4 Cash and cash equivalents, net
. . . . . . . . . . . . . . . . . . . . . . 110
4.5 Bank loans, etc.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111
4.6 Other payables
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111
5. Other disclosures
5.1 Related parties and ownership
. . . . . . . . . . . . . . . . . . . . . . 112
5.2 Investments in subsidiaries
. . . . . . . . . . . . . . . . . . . . . . . . . . 113
5.3 Contingent liabilities and other financial obligations
. . . . 113
5.4 Events after the reporting period
. . . . . . . . . . . . . . . . . . . . . 113
5.5 Financial definitions
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113
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Financial statements
Key figures
(EUR m) 2025 2024 2023 2022 2021
Income statement
Revenue 3 3 5 3 3
EBITDA - 3 - 3 1 1 1
Depreciation and amortisation - - 2 2 2
Operating profit - 3 - 3 - 1 - 1 -
Income from investments in subsidiaries 69 - 3 - 14 - 21 55
Net financials 19 21 27 - 24 23
Profit before tax 85 15 12 - 46 78
Net profit for the year 85 15 12 - 46 78
Financial positions
Balance sheet total 1,238 1,222 778 848 945
Equity 1,180 1,159 713 763 867
Investment in tangible assets - - - 16 -
Cash flows
Operating activities * * * * 3
Investing activities * * * * 5
Financing activities * * * * - 8
Change in cash and cash equivalents * * * * -
Employees
Average number of employees 21 19 13 12 9
Donations
Donations for the year 28 28 23 21 20
Ratios
Solvency ratio 95,3 94,8 91,6 90,0 91,8
Return on equity 7,3 1,6 1,6 - 5,6 9,5
* With reference to section 86 of the Danish Financial Statements Act, the Hempel Foundation Group
does not prepare cash flow statements for the years 2022-2025, as the Foundation is included
in the consolidated cash flow statement on page 57.
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Income statement
Note (EUR m) 2025 2024
2.1 Revenue 3 3
Gross profit 3 3
Distribution expenses - -
Administrative expenses - 6 - 6
2.3 Income from investments in subsidiaries 69 - 3
4.3 Financial income 37 24
4.3 Financial expenses - 18 - 3
Profit/loss before tax 85 15
2.4 Tax on profit/loss for the year - -
Net profit/loss for the year 85 15
(EUR m) 2025 2024
Proposed distribution of profit
Proposed distribution framework 28 39
Reserve for net revaluation under the equity method 69 - 3
Retained earnings - 12 - 20
Proposed distribution of profit 85 15
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Financial statements
Balance sheet
31 December
Note (EUR m) 2025 2024
Assets
Land and buildings 14 18
Other fixtures and fittings, tools and equipment - -
Property, plant and equipment in progress - -
Prepayments for property, plant and equipment - -
3.1 Property, plant and equipment 14 18
5.2 Investments in subsidiaries 954 999
3.2 Other investments 255 199
Fixed asset investments 1,210 1,198
Fixed assets 1,224 1,216
3.4 Trade receivables - -
3.4 Receivables from group enterprises 3 -
3.4 Other receivables - 1
Foundation tax 3 1
3.3 Prepayments - -
Receivables 6 2
Cash at bank and in hand 8 4
Current assets 14 6
Assets 1,238 1,222
Note (EUR m) 2025 2024
Liabilities and equity
4.1 Capital base 5 5
Reserve for net revaluation under the equity method 895 940
Distribution framework 40 40
Retained earnings 240 174
Equity 1,180 1,159
Provisions for pensions and similar obligations - -
Provisions - -
Credit institutions - -
4.5 Long-term debt - -
Credit institutions - -
Trade payables - -
Payables to group enterprises - -
4.6 Other payables 58 63
Short-term debt 58 63
Debt 58 63
Liabilities and equity 1,238 1,222
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Financial statements
Statement of changes in equity
31 December
Note (EUR m) Capital base Reserve for net revaluation
under the equity method
Distribution framework Retained earnings Total
Equity at 1 January 2025 5 940 40 174 1,159
Exchange adjustments - - 43 - - -43
Grants for the year - - - 28 - -28
Other adjustments - 7 - - 7
Dividend from group enterprises - - 78 - 78 0
Cancelled grants for the year - - - - 0
Net profit/loss for the year - 69 28 - 12 85
4.1 Equity at 31 December 2025 5 895 40 240 1,180
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Financial statements
General
This section gives a summary of the significant
accounting policies. Further accounting policies
are presented in the specific notes.
The Annual Report of the Hempel Foundation
for 2025 has been prepared in accordance with
the provisions of the Danish Financial Statements
Act (Årsregnskabsloven) applying to large
enterprises of reporting class C. The Annual
Report for 2025 is presented in EUR millions.
The accounting policies applied remain
unchanged from previous years.
Recognition and measurement
Revenues are recognised in the income
statement as earned. Furthermore, value
adjustments of financial assets and liabilities
measured at fair value or amortised costs are
recognised.
Moreover, all expenses incurred to achieve
the earnings for the year are recognised in the
income statement, including depreciation,
amortisation, impairment losses and provisions
as well as reversals due to changed accounting
estimates of amounts that have previously been
recognised in the income statement.
Assets are recognised in the balance sheet
when it is probable that future economic
benefits attributable to the asset will flow to
the Hempel Foundation, and the value of the
asset can be measured reliably.
Liabilities are recognised in the balance sheet
when it is probable that future economic benefits
will flow out of the Hempel Foundation, 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.
Recognition and measurement take into account
predictable losses and risks occurring before the
presentation of the Annual Report that confirm
or invalidate affairs and conditions existing at
the balance sheet date. Euro is used as the
presentation currency. All other currencies are
regarded as foreign currencies.
Foreign currency translation
Functional and presentation currency
Items included in the financial statements of
each of the Hempel Foundation’s entities are
measured using the currency of the primary
economic environment in which the entity
operates (functional currency).
Translation of transactions and balances
Transactions in foreign currencies are translated
at the exchange rates on the transaction dates.
Gains and losses arising from differences
between the transaction date rates and the
rates on the payment dates are recognised in
financial income and expenses in the income
statement. Where foreign exchange transactions
are considered hedging of future cash flows,
the value adjustments are recognised directly
in equity.
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 recognised in financial income and
expenses in the income statement.
Fixed assets acquired in foreign currencies are
measured at the transaction date rates.
Translation of Group companies
For foreign subsidiaries with a functional
currency other than EUR, the income statements
are translated into EUR at the exchange rates
prevailing at the end of the reporting period for
balance sheet items and at average monthly
exchange rates for income statement items in
so far these do not deviate materially from the
actual exchange rates at the transaction date.
All exchange differences are recognised in
the income statement for the year, except for
exchange rate adjustment of investments in
subsidiaries arising from:
– foreign exchange adjustments arising from
the translation of the opening balance of
equity of foreign subsidiaries at the exchange
rates on the balance sheet date
– the translation of foreign subsidiaries’ income
statements from monthly average exchange
rates to exchange rates at the end of the
reporting period
These specific exchange rate adjustments
are recognised directly in equity. If the foreign
entity is a non-wholly owned subsidiary, the
relevant proportion of the translation difference
is allocated to the minority interest.
Other operating income
Other operating income and operating expenses
comprise items of a secondary nature relative to
the Hempel Foundation’s core activities, including
gains or losses on the sale of fixed assets.
1 Basis of preparation
1.1 General accounting policies
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Other external expenses
Other external expenses include the year’s
expenses relating to the Hempel Foundation’s
core activities, including expenses relating to
administration, premises, etc.
Cash flow statement
With reference to section 86 of the Danish
Financial Statements Act, the Hempel Foundation
does not prepare a cash flow statement.
1.1 General accounting policies — continued
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2 Results for the year
Accounting policies
Revenue from management fees is recognised
in the income statement in the periods the
management fee concerns.
Revenue is recognised exclusive of VAT and net
of discounts relating to sales.
Disaggregation of revenue
The following table displays revenue
disaggregated into sales per geographical region:
(EUR m) 2025 2024
EMEA 3 3
Total revenue 3 3
Revenue disaggregated into sales per
customer category:
(EUR m) 2025 2024
Rent - -
Other 3 3
Total revenue 3 3
2.1 Revenue
Accounting policies
Wages, salaries, social security contributions,
annual leave and sick leave, bonuses and non-
monetary benefits are recognised in the year
in which the associated services are rendered
by employees of the Hempel Foundation.
Where the Hempel Foundation provides long-
term employee benefits, the costs are accrued
to match the rendering of the services by the
employees concerned.
2.2 Employee costs
Staff expenses
(EUR m)
2025 2024
Wages and salaries 3 2
Pensions - -
Other social security expenses - -
Total 3 2
Average number of employees 21 19
Remuneration for Board of Directors
and Management 2025 (EUR t)
Hempel Foundation Hempel Invest A/S Hempel A/S
Remuneration Committees Car Remuneration Committees Remuneration Committees Total
Richard Sand 101 3 52 47 11 221 94 529
Leif Jensen 50 11 - 40 17 74 54 246
Kim Dam-Johansen 34 3 - 34 8 - - 79
Birgitte Hagemann Snabe 34 3 - 34 - - - 71
Lars Aaen 34 3 - 34 8 - - 79
Sisse Fjelsted Rasmussen 34 5 - 34 5 - - 78
Claus Juul Petersen 31 - - 31 - - - 62
Lone Borre 34 - - 34 - - - 68
Tine Gundersen 34 - - 34 - - - 68
Sara Bennicke Vollmond 3 - - 3 - - - 6
Total 389 28 52 325 49 295 148 1,286
Anders Holm 322
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2.4 Income tax
Accounting policies
The items ‘Income from investments in
subsidiaries’ in the income statement include the
proportionate share of the profit for the year less
depreciation of intercompany profits.
2.3 Income from investments
in subsidiaries
Income tax
Accounting policies
Income tax for the year consists of current
tax for the year and deferred tax for the year.
The tax attributable to the profit for the year is
recognised in the income statement, whereas
the tax attributable to equity transactions is
recognised directly in equity.
Deferred tax assets and liabilities
Accounting policies
Deferred income tax is measured using the
balance sheet liability method in respect of
temporary differences 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, including the tax base of tax
loss carryforwards, are measured at the value at
which the asset is expected to be realised, either
by eliminating the tax on future earnings or by
setting 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 crystallise as current
tax. Any changes in deferred tax due to changes
to tax rates are recognised in the income
statement.
Current tax receivables and liabilities
Accounting policies
Current tax liabilities and receivables are
recognised 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.
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3 Operating assets and liabilities
3.1 Property, plant and equipment
Accounting policies
Property, plant and equipment are measured at
a cost less than accumulated depreciation and
less than any accumulated impairment losses.
Costs comprise the cost of acquisition and
expenses directly related to the acquisition up
until the time when the asset is ready for use.
In the case of assets of own construction, costs
comprise direct and indirect expenses for labour,
materials, components and sub-suppliers.
Interest expenses on loans raised directly for
financing the construction of property, plant
and equipment are recognised in costs over the
period of construction. All indirectly attributable
borrowing expenses are recognised in the
income statement.
Depreciation based on costs reduced by any
residual value is calculated on a straight-line
basis over the expected useful lives of the assets,
which are:
– Buildings (max.) 30-50 years
– Other fixtures and fittings, tools and
equipment 3-10 years
Land is not depreciated.
Leasehold improvements are included in other
operating equipment and are recognised at
cost and depreciated over the term of the lease;
however, not exceeding 10 years.
Impairment of fixed assets
The carrying amounts of property, plant and
equipment are reviewed on an annual basis
to determine whether there is any indication
of impairment other than that expressed by
amortisation and depreciation.
If so, the asset is written down to its lower
recoverable amount.
Property, plant and equipment (EUR m) Land and
buildings
Other fixtures
and fittings, tools
and equipment
Cost at 1 January 23 4
Exchange adjustment - -
Additions for the year 1 -
Disposals for the year - 10 - 3
Transfers for the year - -
Cost at 31 December 14 1
Impairment losses and depreciation at 1 January 5 4
Depreciation for the year - -
Reversal of impairment and depreciation of sold assets - 5 - 3
Impairment losses and depreciation at 31 December - 1
Carrying amount at 31 December 14 -
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Financial statements
3.2 Other securities and investments
Accounting policies
Other securities and capital investments,
recognised under fixed assets, consist of listed
and non-listed bonds and shares measured at
fair value on the balance sheet date. The fair
value of listed shares and bonds is calculated on
the latest listed closing quote. The fair value of
investments in other securities and investments
that are not traded often is measured with
reference to the latest publicly announced equity.
Realised and unrealised capital gains and capital
losses are included in net financials in the income
statement.
The investments are classified in accordance
with the fair value hierarchy:
Level 1: Fair value can be measured using
quoted market prices in an active
market for identical assets and
liabilities.
Level 2: Fair value can be measured using
observable inputs other than quoted
market prices.
Level 3: Fair value is measured using
unobservable inputs.
(EUR m) 2025 2024
Costs, beginning of year 194 208
Additions for the year 93 67
Disposals for the year - 51 - 80
Exchange rate at year-end rate - - 1
Cost at 31 December 236 194
Net revaluations, beginning of year 5 - 6
Net revaluations for the year 14 11
Exchange rate at year-end rate - -
Net revaluations end of year 19 5
Carrying amount at 31 December 255 199
Investment category (EUR m) Fair value
hierarchy level
Fair value as of
31 December
2025
Net revaluation
recognised
through profit
and loss
Bonds (listed) 1 51 -
Shares (listed) 1 201 2
Other investments (listed) 1 2 -
Other investments (non-listed) 3 1 -
Total 255 2
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3.3 Prepayments 3.4 Receivables
Accounting policies
Prepayments comprise prepaid expenses
relating to rent, insurance premiums and interest.
Accounting policies
Receivables are measured in the balance sheet
below amortised cost and net realisable value,
which corresponds to a nominal value less than
the provisions for bad debts. Provisions for
bad debts are determined on the basis of an
individual assessment of each receivable and, in
respect of trade receivables, a general provision
is also made based on the Hempel Foundation’s
experience from previous years.
Receivables are recognised in the balance
sheet at amortised cost, which substantially
corresponds to the nominal value. Provisions for
estimated bad debts are made.
(EUR m) 2025 2024
Recievables of which due more than one year from the balance sheet date - 1
Total - 1
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4 Capital structure and financing items
4.1 Base capital
4.2 Financial risks
The base capital of the Hempel Foundation
amounts to DKK 35 million.
The Hempel Foundation has adopted a
conservative investment strategy is hence are
not exposed to financial risks other than what is
considered normal market risk.
4.3 Net financials
Accounting policies
Financial income and expenses are recognised in
the income statement at the amounts relating to
the financial year.
Financial income (EUR m) 2025 2024
Interests from subsidiaries - -
External interest income 1 1
Dividend 13 5
Income from other securities and investments 23 18
Total 37 24
Financial expenses (EUR m) 2025 2024
Other financial expenses - -
Exchange adjustments, expenses 18 3
Total 18 3
4.4 Cash and cash equivalents, net
Accounting policies
Cash and cash equivalents consist of cash at the
bank and in hand.
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4.5 Bank loans, etc. 4.6 Other payables
Accounting policies
Fixed-interest loans, such as mortgage loans
and loans from credit institutions, are recognised
initially at fair value net of incurred transaction
costs and subsequently at amortised cost using
the effective interest method. The difference
between the proceeds initially received and
the nominal value is recognised as a financial
expense in the income statement over the
loan term.
Mortgage loans are measured at amortised
cost, which for cash loans corresponds to the
remaining loan. Amortised 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 terms of the loan at the date of
raising the loan.
Accounting policies
Grants
Grants, which in accordance with the Hempel
Foundation’s purpose are approved and
disbursed on the balance sheet date, are
deducted from equity via distribution of profit
for the year. Grants, which in accordance with
the purpose of the Foundation are approved
on the balance sheet date and announced to
the recipient, but have not yet been paid on
the balance sheet date, are deducted via the
distribution of profit for the year and included
as a liability.
At the Board of Trustees meeting at which the
Annual Report is adopted, the Board decides on
the reserve for future donations expected to be
distributed. The agreed amount is transferred
from the free reserves to the reserve for future
donations. Concurrently with grants being
announced to the recipients, the amounts are
paid or transferred as liabilities or, in exceptional
cases, as provisions regarding distributions.
Other liabilities
Other liabilities are measured at amortised cost,
substantially corresponding to the nominal value.
Other liabilities comprise donations not yet paid,
employee costs payable, VAT and duties payable,
accruals, other payables and fair values of deriva-
tive financial instruments.
Other payables (EUR m) 2025 2024
Grants
Accrued grants 1 Janaury 62 64
Grants during the year 28 28
Paid grants during the year - 32 - 29
Cancelled grants for the year - -1
Accrued grants 31 December 58 62
Other payables - 1
Total 58 63
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5 Other disclosures
The Hempel Foundation had the following transactions
with related parties, (income)/expense:
5.1 Related parties and ownership
Related parties and ownership Basis
Controlling influence:
Hempel Invest A/S, Amaliegade 8, 1256 Copenhagen K, Denmark Related party/subsidiary
Subsidiaries owned by Hempel Invest A/S as specified in note 5.6 in the consolidated financial statements Related party/subsidiary
Hempel Ejendomme A/S, Amaliegade 8, 1256 Copenhagen K, Denmark Related party/subsidiary
Members of the Executive Board and Board of Directors of Hempel A/S and Hempel Invest A/S
as well as the Board of Trustees of the Hempel Foundation are also regarded as related parties.
For remuneration to the Board of Trustees, please refer to note 2.2 Employee costs.
Other related parties:
Hempel’s Employee Foundation, Amaliegade 8, 1256 Copenhagen K, Denmark Related party
Fonden J.C. Hempel Glasmuseum, Amaliegade 8, 1256 Copenhagen K, Denmark Related party
Hempel’s Employee Foundation of 2017, Amaliegade 8, 1256 Copenhagen K, Denmark Related party
The remuneration of the Board of Directors and Executive Management is disclosed in note 2.2.
(EUR m) 2025 2024
Hempel A/S Group:
Rent payments - -
Administrative services provided by the Hempel A/S Group - -
Hempel Invest A/S:
Administrative services provided by the Hempel Foundation - 1 -
Keldskov ApS:
Administrative services provided by the Hempel Foundation - -
Brænderupvænge ApS:
Administrative services provided by the Hempel Foundation - -
Hempel Invest II ApS:
Administrative services provided by the Hempel Foundation - -
Hempel Administration ApS:
Administrative services provided by the Hempel Foundation - -
Transactions with related parties
During the year, the Foundation purchased
advisory services amounting to EUR 72 thousand
(excluding VAT), from a law firm in which a
member of the Foundation Board of Directors is
a partner. In addition, the Foundation purchased
asset management services amounting to
EUR 60 thousand from an investment fund in
which a member of the Foundation Board of
Directors serves on the board.
During the year, the Foundation granted
donations to three organisations totaling EUR
2.6 million. Two members of the Foundation
Board of Directors each serve on the board
of two of these organisations, while a third
board member is employed by one of the
donation recipients.
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5.2 Investments in subsidiaries
Accounting policies
Investments in subsidiaries are recognised
and measured under the equity method. This
implies that the investments are measured in the
balance sheet at the proportionate ownership
share of the net asset value of the enterprises
with deduction or addition of shares of
unrealised intercompany profits and losses.
The total net revaluation of investments in
subsidiaries is transferred upon distribution of
profit to ‘Reserve for net revaluation under the
equity method’ under equity. The reserve is
reduced by dividends distributed to the Hempel
Foundation and adjusted for other equity
movements in subsidiaries.
The consolidation method is applied as a
method of measurement.
(EUR m) 2025 2024
Cost at 1 January 59 59
Additions for the year - -
Cost at 31 December 59 59
Value adjustments at 1 January 940 492
Exchange adjustment - 43 29
Net profit/loss for the year 69 - 3
Dividend to the Parent Company - 78 - 7
Dilution gain - 429
Other adjustments 7 -
Value adjustments at 31 December 895 940
Carrying amount at 31 December 954 999
Investments in subsidiaries are specified as follows: Place of registered office Share capital Ownership
Name
Hempel Invest A/S Copenhagen EUR 15,000,000 100%
Hempel Ejendomme A/S Copenhagen DKK 800,000 100%
5.3 Contingent liabilities and other financial obligations
5.4 Events after the reporting period
The Hempel Foundation has an unrecognised
latent tax liability amounting to EUR 11.7 million
(2024: EUR 0 million). The tax liability relates
to tax provisions for future grants. The foundation
expects to neutralise this tax liability through
future grants, which is why the latent liability is
not recognised.
The Hempel Foundation has committed a total
investment of EUR 1.1 million in other securities.
As of 31 December 2025 the remaining
commitment is EUR 0.5 million
(2024: EUR 0.7 million).
No events have occurred after the balance sheet
date that could significantly affect the financial
position of the Hempel Foundation.
5.5 Financial definitions
Financial ratios have been calculated as follows:
EBITDA = Operating profit (and loss) before impairment, amortisation and depreciation
Solvency ratio =
Equity at year-end x 100
Total assets
Return on equity =
Net profit for the year x 100
Average equity
Hempel Foundation Annual Report 2025
Financial investments Sustainability statementFoundation governance Financial performance Statements 113PhilanthropyIntroduction Engaged ownership
Hempel Foundation
financial statements
Financial statements
Hempel Foundation
Amaliegade 8
1256 Copenhagen K
Denmark
CVR no. 21518018
Tel: +45 4527 3074
hempel.foundation@hempel.com