Jøtul AS
Annual report
and Independent auditor’s report
for the year ended 31 December 2022
Registered Office:
Langøyveien, 1678 Kråkerøy
3004 Fredrikstad
Norway
Jotul AS
Annual report
for the year ended 31 December 2022
TABLE OF CONTENTS
Pages
Consolidated management report of the Board of Directors 3 – 16
Responsibility statement 17
Independent auditor’s report 18 – 22
Consolidated statement of comprehensive income 23
Consolidated statement of financial position 24 – 26
Consolidated statement of changes in equity 27
Consolidated statement of cash flows 28
Notes to the consolidated financial statements 29 – 75
Jøtul AS standalone annual accounts
76 – 93
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
Consolidated Management Report of the Board of Directors
Business
The Jøtul Group (representing Jøtul AS together with its subsidiaries) is one of the three largest
suppliers of fireplaces in Europe and a significant player in North America. The company, with a
history dating back to 1853 through its legacy as one of Norway’s oldest companies, distributes
stand-alone stoves, inserts, frames and accessories for fireplaces. The Group’s main brands are
Jøtul, Scan and Ravelli. The Jøtul fireplaces are manufactured from cast iron and appear timeless
and robust, with Norwegian origins. The Scan fireplaces are manufactured from plated steel and
are characterized by modern Danish design, while the Ravelli pellets stoves are characterized by
Italian design and technology. The head office is based in Norway. Manufacturing takes place
through own production in Norway, Poland, France and the USA, in addition to a range of bought-
in products. The products are sold through one of the most wide-reaching global networks in the
industry, consisting of own sales companies and distributors. The products reach the end
consumers through specialty shops, and in Norway also through building materials retail chains.
On June 1
st
, the Group acquired the Italian pellet stove company AICO S.p.A. (AICO), which owns
and distributes the Ravelli pellet stoves brand. Both the acquirer and the acquired company were
owned by the same ultimate shareholder before this transaction. The financial statements of AICO
are included in the consolidation accounts of the Group starting from June 1
st
, 2021.
The year in brief – Jøtul Group
The revenue in 2022 increased with 27.2%, to MNOK 1,614.5 compared to MNOK 1,269.0 in
2021. All key markets for wood burning stoves continue to show strong demand, particularly the
Nordics, Germany and France. Home improvement spending continues to be a strong driver, and
is even further enhanced by the significant increases in electricity and gas prices experienced
throughout most of 2022 across all markets, which confirms wood burning as an important heating
alternative and contributes to sustained strong revenues. Furthermore, the German market has
seen strong demand following requirements to phase out older stoves to comply with new
standards concerning efficiency and emissions. On the downside, since mid-2022 the Group has
been experiencing a notable slowdown on the pellet stoves markets in Italy and France, driven
primarily by the scarcity and increased cost of pellets as fuel.
Considering the factors mentioned above, the total order intake was up from MNOK 1,377.4 in
2021 to MNOK 1,868.5 in 2022. The total order book at the end of 2022 was MNOK 485.5
compared to MNOK 230.9 at the end of 2021.
Despite the very high demand from the market, it is important to acknowledge that the ability to
deliver to such demand is under pressure due to the fact that some suppliers of components are
struggling to meet such growth. Jøtul is working on establishing new sourcing and on insourcing
some components.
Page 3 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
In 2022, the Jøtul Group reached a consolidated operating income of MNOK 1,625.2 (2021:
MNOK 1,273.0). The operating result of the year totaled MNOK 175.2 in 2022 (2021: MNOK 34.8).
The 2022 total comprehensive income was MNOK 179.2 (2021: MNOK -29.5).
EBITDA (Earnings before interests, taxes, depreciation, and amortizations: Operating Result less
Depreciations) was MNOK 250.7 in 2022 (2021: MNOK 121.4). This includes the effect of non-
recurring items totaling MNOK 26.3 (2021: MNOK 35.4) due mainly to an inventory clean-up
correction in AICO S.p.A., the shareholder’s monitoring fees and costs related to a production
asset breakdown in Norway. Adjusted EBITDA (adjusted Earnings before interests, taxes,
depreciation and amortization: Operating result less Depreciations and non-recurring items) was
MNOK 276.9 in 2022 (2021: MNOK 156.9).
Cash and cash equivalent as per 31 December 2022 was MNOK 131.1. Available RCF (less
ancillary facility of MNOK 22.0) was MNOK 52.0 giving a total available liquidity of MNOK 183.1.
During the year, Jotul Group had an average of 763 full-time employees (2021: 758).
The manufacturing operations in Poland improved further in terms of output in 2022, with an
increase of +13% compared to the previous year. The manufacturing operations are now
considered mature, including the AICO production line ramped-up in Poland during 2021 and
early 2022, and the Group continues working on further efficiency improvements and
optimizations.
Jøtul Group experienced substantial increase of raw material prices in 2021 and in 2022. In
addition, the cost of energy increased significantly, both in Norway and in Poland. These major
and extraordinary inflationary developments are for the most part compensated with selling prices
increases, however there is a partial unfavorable timing effect. Throughout the second half of
2022, the Group observed that the prices of certain materials have started to stabilize.
The year in brief – Jøtul AS standalone
The revenue in 2022 increased with 39.8%, to MNOK 1,144.2 compared to MNOK 818.5 in 2021.
55.5% of all Jøtul AS revenues are with external customers, the remaining 44.5% being sales to
subsidiaries. External revenue grew with 20.6% in 2022 vs 2021.
All direct markets of Jotul AS show strong demand, in particular the Nordics and Germany. Home
improvement spending continues to be a strong driver, driven primarily by the sharp increase in
electricity and gas prices across all markets, which confirms wood burning as an important heating
alternative and contributes to sustained strong revenues.
In 2022, the Jøtul AS reached an operating result of MNOK 152.7 (2021: MNOK 83.9). The
pretax result totaled MNOK 72.0 in 2022 (2021: MNOK 48.8). The company has accumulated
Page 4 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
losses carried forward from the prior years.
In November 2022, the Jøtul Group successfully listed on the Oslo Stock Exchange its senior
secured bond issued in October 2021 with the ISIN number NO0011104069. The bond loan
matures in October 2024.
Cash and cash equivalent as per 31 December 2022 was MNOK 39.8. Available RCF was MNOK
40.0 giving a total available liquidity of MNOK 79.8.
In 2022, Jotul AS had an average of 158 full-time employees (2020: 159).
Jøtul AS experienced substantial increase of raw material prices during 2022. In addition, the
Kråkerøy melting plant also experienced significant increases in the cost of energy. These
increases are for the most part compensated with price increases on our products but have a
negative timing effect. Throughout the second half of 2022, Jøtul AS observed that the prices of
certain materials have started to stabilize.
On May 26
th
, 2022, Jøtul AS sold the Spanish subsidiary Jotul Hispania s.l.u. to Jotul France SAS.
Prior to this transaction, Jotul France was already exercising management oversight over the
Spanish division.
Going Concern
The board of directors have assessed going concern basis by considering financial performance
and forecasts of the Group as well as the following:
- The Group has successfully refinanced the Senior secured bonds in October 2021 for a
period of three years. Simultaneously, the Group has also successfully renewed its
Revolving Credit Facility (RCF) with Nordea bank, with total available credit of 75m NOK,
to be used for working capital purposes as additional resourced to regulate the seasonality
lows.
- FY2022 revenues are 27% higher than last year and 8% higher than budget, driven by
strong market dynamics and improved output performance.
- The order book as of December 2022 is 110% higher than last year, paving the way for
continued favorable revenue development in 2023. The growth and demand are in
particular strong for our wood stoves portfolio, which is the core of our product offering.
Key driver for the strong market is mainly the high price of electricity and natural gas,
which is leading to the increasing use of wood as alternative or complementary heating
resource. These market conditions are expected to remain throughout 2023 and most of
2024.
Page 5 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
- The inflationary development on the cost side, noted throughout the past two years as part
of the post-Covid-confinement recovery, followed by the effects of the energy crisis, is
expected to be less significant in 2023. Nevertheless, the market proved ability to recover
such cost in-creases via selling price increases, allowing the Group to successfully defend
its margins.
- The factory in Poland, which started operations in early 2020, stabilized throughout late
2020 and in 2021, and the Group now sees more mature and efficient manufacturing
operations.
- The revenues in 2023 are estimated to exceed the 2022 level. The order intake is expected
to remain very strong, driven by strong demand in all the Group’s main markets in
particular for wood burning stoves. While considering, on top of this, the matured
operations and continued efficiency improvement projects, the Group estimates strong
financial performance in 2023.
For further information refer to Note 2.1.
With the current Group performance, the favorable business outlook, and the conclusion of the
refinancing exercise, it is the board of directors’ expectation that the Group will have adequate
resources to continue trading for the foreseeable future.
In the Board’s opinion, the consolidated financial statements provide a true and fair view of the
Company’s and Group’s financial position and results. Also, in accordance with the Accounting
Act §3-3a, the Board confirms that the financial statements have been prepared under the
assumption of going concern.
Market
The Group’s largest markets are the Nordic countries, France, Italy and USA. The company
supplies fireplaces for wood, gas and pellets. The market is multi-local, and the competitors are
largely local participants in national markets. This is driven by historical positions and a
fragmented regulatory picture, where manufacturers of wood-burning stoves are required to
comply with differing local rules and regulations. In most markets, the local participant is the
market leader, such as the Jøtul brand is in Norway. In the short term, demand is influenced by
local outside temperatures and the cost development for alternative heating sources – electricity,
oil and gas.
Long term, market growth is driven primarily by climate changes, the willingness of consumers to
invest in homes, as well as an increased focus on reduction of local particle emissions and the
use of renewable energy. Important product characteristics for fireplaces are design, and the
products’ ability to utilize the energy in the wood and to burn the wood in a clean manner to
minimize particle emissions. In Norway, strict combustion regulations were introduced early, and
the Group’s cast iron products are among the global leaders in this area.
Page 6 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
The Group emphasizes positive margin development. As a vehicle for monitoring and following
up the sales-related key performance indicators, Group management conducts business reviews
for all sales regions. Typical KPIs for sales are market contribution margin (includes rebate level
and sold product mix), market share, the number of new customer relations engaged, and overall
sales strategy for the individual geographical markets. Whenever corrective measures are needed
to be performed, these are communicated in the business reviews and reported on routinely.
Group structure
The company structure of the Group as of 31 December 2022 is the following:
On May 26
th
, 2022, Jøtul AS sold the Spanish subsidiary Jotul Hispania s.l.u. to Jotul France SAS.
Prior to this transaction, Jotul France was already exercising management oversight over the
Spanish division, thus this transformation is considered an optimization of the Group’s structure.
Manufacturing principles
Jøtul operates four manufacturing facilities, one cast iron production plant in Fredrikstad, Norway,
one production and assembly plant in Wroclaw, Poland, one gas and wood stoves manufacturing
site in Portland (ME), the United States, and a smaller manufacturing facility in Motz, France. The
Group employs lean manufacturing principles and strict controls of operational expenditures
(“OPEX”). As a vehicle for monitoring and following up the key performance indicators in
manufacturing and logistics, Group management conducts business reviews for all manufacturing
sites. Typical KPIs for factories are efficiency and productivity, operating expenses, inventory
levels, production output related to plan/budget, on-time deliveries and several KPIs for ESG.
Whenever corrective measures are needed to be performed, these are communicated in the
business reviews and reported on routinely.
Page 7 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
Risk exposure
The Group’s activities entail various types of financial risk associated with foreign currency,
interest rates, raw materials prices, credit and liquidity. To reduce its exposure to unfavourable
foreign exchange fluctuations, the Group currently relies mainly on the effectiveness of natural
hedging driven by the fact that it does not have major discrepancies between the inflows and the
outflows of EUR and USD (main foreign currencies), while PLN is closely linked to the
development of the EUR currency rates. Exposures to other currencies are deemed less
significant. The Group is currently evaluating the re-introduction of foreign exchange forward
contracts to cover its exposure to currency rate risk more effectively.
Technical risk is primarily associated with the operation of existing equipment and the installation
of new equipment. This risk is considered low, based on experience and competence developed
while building and maintaining the physical structures of the Group. There have been no major
incidents resulting in a prolonged stoppage in production in the last 10 years at any of the Group’s
manufacturing sites. Related to the establishment of the new factory in Poland in 2019/2020, the
Group has purchased several new machines to replace the oldest ones currently in operation,
which reduces the technical risk further.
In the context of the war in the Ukraine, the Group confirms that it has minimal exposure to the
Russian, Belarusian or Ukrainian markets, both in terms of supply base and in terms of sales.
While some of the Group’s suppliers might be sourcing raw materials from these countries, the
Group assesses the risk of disruption as low. The Group has discontinued any supply of goods
to the Russian and Belarusian markets.
Climate risks
When it comes to the transition to sustainability risks driven by regulatory requirements and
customer behavior, Jøtul is permanently monitoring the latest developments in these areas. The
goal is to always have a product portfolio that meets or exceeds the most stringent rules and
regulations, and to monitor and adapt to the latest expectations from consumers in terms of
product design/functionality, climate footprint, and overall corporate social responsibility. Jøtul
spends around MNOK 40 per year on R&D and product development.
Operational risks driven by the adverse effects of climate change (e.g., more frequent occurrence
of extreme weather conditions, conflicts, pandemics, etc.) are somewhat difficult to evaluate.
Nevertheless, the board considers such risks to be remote, while adequate insurance policies are
in place. The main geographical areas where Jøtul does business are considered more resilient
in recovering from potential natural disasters, and less prone to disruptions caused by conflict.
Moreover, the nature of Jøtul’s business implies less exposure to scarce materials and
components, which in its turn implies higher resilience in case of major global supply chain
disruptions. Jøtul is actively working on building strategic, long-term relationships with its
Page 8 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
suppliers, on monitoring supplier financial health, and on having alternative sourcing solutions
where suitable.
Corporate social responsibility and sustainability
Code of conduct and ethical guidelines
The Jøtul Group Code of Conduct is based on the UN Global Compact’s ten principles which are
in turn based on the UN Declaration of Human Rights, the ILO Declaration on Fundamental
Principles and Rights at work, the Rio Declaration on Environment and Development, and the UN
Convention Against Corruption. It is our view that a professional, active and responsible business
includes compliance not only with local laws and regulations, but also compliance with well-
established and widespread human rights conventions, agreements and ethical standards.
The Code of Conduct serves to address and mitigate the main risks in the area of environmental,
social and employee matters, respect for human rights and anti-corruption matters. These are
among others risk of non-compliance with environmental, sanitary, health, safety and labour law;
risk of discrimination; risk of corruption and risk of reputation damage coming from non-
compliance with the laws and regulations.
The Group does not have a formalized ethics program including an “ethics helpline”. Employees
are instead informed to contact HR and line manager to report any non-compliance matters.
The Group is committed to respecting the privacy of individuals. All Group entities shall
understand and comply with applicable privacy laws, including, but not limited to the General Data
Protection Regulation (EU) 2016/679 (GDPR), and Group internal routines for data protection.
Starting with the edition published in 2021, the Code of Conduct introduced a whistleblowing
reporting channel.
The Group implemented a policy on GDPR treatment of personal information in 2018 as part of
the company Code of Conduct.
Jøtul has extensive focus on health and the workplace environment. The Group’s production is
traditional, and parts of the production are still considered heavy industry. Some work tasks
involve physical challenges, and the distribution of female and male employees in production is
therefore still skewed. The Group’s goal is for full gender equality between men and women to be
prevalent. The female staff constituted 25% of the total workforce.
Absence due to sick leave in the business units with the highest number of employees was as
follows:
•
Jotul Poland 5.96%
Page 9 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
•
Jøtul AS 6.65%
•
Jotul North America 2.50%
The Group’s employee policies entail that race, religion, ethnicity, denomination, national origin,
extraction, gender, age, sexual orientation, war veteran status, political association or invalidating
conditions or other characteristics that are protected by law are not taken into consideration.
Wages, including overtime compensation and benefits, are stipulated in line with the level required
by the applicable laws in respective countries. The Group is an inclusive workplace company,
which also includes a commitment to make arrangements for people with disabilities. Incidents
like bullying, discrimination of any kind and harassment are not accepted, and the company has
a zero tolerance with such cases.
The health and safety of all the people who work for and with Jøtul is a top priority. Incidents are
reported daily to the relevant site management. Performance is disclosed during monthly
business reviews, which includes accidents, near misses and days lost. When an incident occurs,
there is a follow-up process with the quality manager / EH&S, team leaders and staff to evaluate
the situation and remediate the root cause. All incidents and accidents occurring in 2022 were
assessed as minor and all employees resumed their duties.
Jøtul Group has zero tolerance for all forms of corruption and makes active efforts to ensure that
this does not occur.
It is forbidden to offer, promise or give, as well as request, accept a promise of or receive a bribe.
The Group also does not tolerate abusing of a position of trust for own or the Group’s gain, for
example through the use of bribes.
The Jøtul Group works systematically to prevent corruption. The management of the Jøtul Group
and its legal entities take care of regular analysis of the risks of corruption related to their own
operations. The management is also responsible for maintaining an adequate anti-corruption
program and implementing any other measures regarded as necessary in order to prevent the
corruption risks identified in the risk analysis.
The compliance to the Group’s Code of Conduct is paramount and all employees are obliged to
make active efforts to complied with the values defined in the Code, and with all applicable laws
and regulations.
Sustainable development
The ability to offer high-quality and environmentally friendly products is central in Jøtul Group’s
product development and manufacturing processes. The cast iron utilized in manufacturing is
produced from recycled scrap iron using hydroelectric power and has consequently no significant
negative impact on the external environment.
Page 10 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
The Group’s products are among the most energy efficient in the market and have a very clean
combustion technology. Jøtul ensures that all products are energy labeled in accordance with
local energy requirements. The company has R&D departments at the head office and largest
manufacturing facility at Kråkerøy, at the operations in Denmark (SCAN), in Jotul North America,
and at AICO Italy. This is to ensure meeting current and future demands related to emission
regulations and customer preferences.
There are both international and national efficiency and emission-related requirements imposed
on the wood stove manufacturing industry. These include the Conformité Européene (CE)
requirements European Norms (EN)13240 for freestanding stoves, and EN13229 for inserts, with
which Jøtul complies for the entire product portfolio.
The new pan-European standard EN16510 relating to residential solid fuel burning appliances
will be introduced starting from July 2023. With the introduction of this standard, local
demands/regulations, such as the AT regulations in Austria, the NS (dust test) in Norway, etc.,
will be phased-out/replaced. Some countries will continue to have local initiatives connected to
tax incentives for the commercialization of low-polluting products (e.g.: Italy’s existing “Aria Pulita”
regulations). The EN16510 will undergo a period of harmonization and is expected to reach
maturity by July 2025. Jøtul will monitor and adopt the requirements of the standard as they
develop and are enacted. Jøtul stoves are also Eco-labeled and they are listed in the mandatory
European consumer databank EPREL, alongside the listing in several voluntary data banks like
the Belgian, the Swiss, etc.
The United States has its own regulations from the United States Environmental Protection
Agency (US-EPA), while Australia and New Zealand have shared regulations, being AS/NZS
4012:2014. For the United Kingdom there will be a separate UK label based on the EN 16510
standard.
Customer preferences to a large extent concern product design, so Jotul Group R&D efforts have
to be managed according to both strict regulatory requirements and soft consumer preferences.
Full-year R&D spending in 2022 was MNOK 40.2 of which MNOK 23.3 was booked as capital
expenditure (2021: R&D spending of MNOK 41.8 of which MNOK 23.2 was booked as capital
expenditure).
Pollution and climate footprint
Unlike other sources of fuel, wood, which constitutes the core of our product portfolio, is an
environmentally friendly source of fuel because of its carbon neutral status. Over the duration of
its life a tree will absorb CO2 from the atmosphere and then release it if burned or when it
decomposes.
The Jøtul Group is actively working on reducing its environmental impact by:
•
Producing Eco-design products with clean-burn technology
Page 11 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
•
Recycling materials (all cast iron production is with recycled iron, and the foundry is run
on hydroelectricity)
•
Standardizing deliveries and reduce transportation related emissions
•
Using recycling materials for packing and requesting suppliers to do the same
•
Using electrical vehicles as much as possible
•
Using electronical media as much as possible to reduce usage of printed paper
•
Continuously informing our dealers and end-customers about correct wood-burning, to
ensure knowledge regarding emissions and means of reducing them
The Group is implementing KPIs to measure performance on reaching short and long-term goals.
Such KPIs are reported from the relevant functions on a quarterly and annual basis.
The Jøtul products trigger the end customer’s mindset in both an emotional and functional way.
Concerns related to climate change and pollution may affect the customer’s decision to acquire
or not a product. With correct information about the company’s actions to improve its climate
footprint, alongside the education about the wood’s carbon neutral status and the circular aspects
of our production process, the management believes Jøtul’s products will continue to be
appreciated as sustainable and effective heating solutions for a long time ahead.
Transparency Act
Jøtul is subject to the rules in the Norwegian Act on the transparency of businesses, and work
with basic human rights and decent working conditions, also called the Transparency Act. This
act aims to ensure companies' respect for basic human rights and decent working conditions and
will give the general public access to the information.
The Act requires the company to make a statement of the due diligence assessments carried out
regarding this act. This must be made public, and Jøtul will publish this at the webpage location
https://intl.jotul.com/investor-relations within the statutory deadline of 30 June 2023.
Debt instrument
In October 2021, Jøtul Group issued a senior secured bond loan in an amount of MNOK 475.
This loan was used to repay the previous bond loan issued at Jøtul Holdings SA (previous parent
and consolidation level of the Group), in addition to providing additional financing to the business.
The bonds carry a floating interest rate of 3M Norwegian InterBank Offered Rate (NIBOR) + 6.95
per cent per annum and matures in October 2024.
Under the terms and conditions of the bond agreement, the Group had the obligation to list the
instrument within 12 months from issuance date (i.e., by October 6
th
, 2022) on a regulated
exchange. The listing was completed, with an approved delay, and the first day of trading was
November 14
th
, 2022.
Page 12 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
Future development
The Group has a strong global market position and brand recognition, and an extensive
distribution network. Nevertheless, the financial performance over the past decade has been poor.
Over the past years, the main strategic focus was the implementation of efficiency measures and
cost optimizations to restore and improve the company’s profitability. Most notably in this respect
was the establishing in 2019/2020 of the manufacturing and assembly plant in Poland, and the
closure of the manufacturing facilities in Denmark and Italy, and of the assembly lines of Jøtul AS.
This improved the cost competitiveness following a lower cost structure, and the production
efficiency is also gradually and constantly improving. Efficiency and cost optimization initiatives
will continue as part of the day-by-day continuous improvement process, however the
manufacturing structure and footprint is considered mature.
The Group has ambitions to continue growing and is focusing on increased distribution to further
strengthen its global market position. In addition to the continuous focus on design, emissions
and efficiency, the Group is also planning to expand and grow its pellet stoves product offering.
Internal controls over financial reporting
Internal controls over financial reporting aim to provide reasonable assurance on the reliability of
external and internal financial reporting, and their conformity with the applicable laws and
regulations. They help to ensure that financial reporting presents a true and fair picture of the
Group’s net assets, financial position and operational results. In line with its Code of Conduct, the
Jøtul Group aims to provide transparent, accurate, continuous and timely financial information of
the highest quality.
The Group’s internal controls over financial reporting include those policies and procedures that
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of Jotul Group. Applied procedures provide reasonable
assurance that transactions are recorded, as necessary, to permit preparation of financial
statements in accordance with IFRS and that unauthorized acquisition, use or disposition of
Group’s assets that could have a material effect on the financial statements would be prevented
or detected on a timely basis.
The Group’s Finance manual describes the legal and operational responsibilities of senior staff,
accounting and financing resources and reporting requirements, budget procedures and tax, cost
sharing and legal structures. The monthly reporting process is also described. Other areas are
internal controls, financial guidelines and consolidation instructions.
All internal and external local and consolidated financial reporting is systematically reviewed by
local finance personnel or by Group’s finance team. Typical analyses include comparisons with
previous years and budget, financial and operational KPIs, flows of key captions on the income
statement, statement of the financial position, changes in equity, and cash flow statement. All
internal and external financial reporting processes are organized through a centrally managed
reporting calendar.
Page 13 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
Quarterly reporting to the financial markets is approved by the Board of Directors and published
withing two months from the quarter-end.
Liquidity forecasts and debt servicing ability are reviewed by Corporate Finance department and
the Group’s CFO and reviewed by the Group’s shareholder.
The monthly reporting process is normally conducted within the first seven business days of the
month. The components spend six days on their local figures before reporting into the Group
consolidation system Frango. On the seventh day, Group’s finance team consolidates the Group
financial statements. Subsequently, a business review with the ultimate shareholder is held for
presentation of the management report, which includes financial and operational KPIs.
The budget process starts in the month of August, where all components are to prepare a forecast
for the current year. This forecast forms the starting point of the coming year’s budget. Each local
budget is prepared based on local assumptions on sales and cost development. Subsequently
this is revised, and amended if necessary, by Group finance, consolidated in Frango, and
presented to the executive management and to the shareholder.
Jøtul Group’s practices on the reporting of significant compliance incidents requires each
subsidiary to immediately report fraud or any other significant compliance incidents to the Group.
Identified control weaknesses that could impact the reliability of financial reporting must be
brought to the attention of management.
Corporate governance
The Jøtul AS Group is subject to the governance requirements from section 3-3b of the
Accounting Act. As a Norwegian limited liability company with bonds listed on the Oslo Stock
Exchange, Jøtul is subject to various regulatory requirements affecting its corporate governance.
The board of directors of Jøtul AS is responsible for the Group’s corporate governance and
management. The following chart provides an overview of the governance structure.
Governance structure
Page 14 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
Shareholder
As of 31 December 2022, the share capital of Jotul AS is set at NOK 139,413,732 and is divided
into one share fully paid up. The Group has a sole shareholder, Jotul Holdings Sàrl.
Resolutions of the shareholder shall be adopted at a General Meeting. The General Meeting has
full powers to adopt and ratify all acts and operations which are consistent with the Company's
corporate object.
The shareholder may be convened to General Meetings by the Board. General Meetings shall be
held at the time and place specified in the notices.
The Annual General Meeting will examine the reports of the Board of Directors and the auditor
and, if thought fit, will approve the annual accounts. The meeting is also entitled to approve any
allocation of profit proposed by the Board and to decide on the discharge of directors or of the
auditor from any duties.
Board of directors
On 31 December 2022, the Board of directors had the following seven members:
Nils Agnar Brunborg – Chair of the Board
Lars Tore Heggem – Director
René Valentin Christensen – Director
Anette Johansen – Director, Employees’ representative
Bjørn Harald Bjørnli – Director, Employees’ representative
Øyvind Arne Sandnes – Director
Sven Østgulen – Director
Sven Østgulen was appointed as Director starting from August 24
th
, 2022.
The Board may only validly deliberate and act if a majority of its members is present or
represented. Board Resolutions shall be validly adopted by a majority of the votes of the
directors present or represented.
The Board of Directors met several times in 2022 with an average attendance rate of 100 per cent
and adopted some decisions by circular resolution. Members of the board also hold regular
meetings with financial directors of Group entities.
The Board of Directors confirms having adequate insurance policies in place to cover their
responsibilities of their roles and members of the board. The directors and offices insurance for
Jøtul AS and all subsidiaries covers an amount of MNOK 50.
Page 15 | Jøtul AS annual report 2022
Jøtul AS
Consolidated Financial Statements
for the year ended 31 December 2022
Audit committee
On August 25
th
, 2022, as part of strengthening the corporate governance, but also driven by
regulatory requirements in preparation for the listing of the debt instrument (bond) on the Oslo
Stock Exchange, the Group established an Audit Committee. The role of the Audit Committee is
to assists the Board of Directors in its responsibility with respect to overseeing the Group’s
financial reporting, the audit of the stand-alone and consolidated accounts, the independence of
the external auditors, the risk management and internal control, and the standards of business
conduct and compliance.
The Audit Committee consists of two members, one being independent and both having finance
and accounting background. The Board elected Sven Østgulen as Chairman, Øyvind Arne
Sandnes being the other member of the Committee.
External auditor
Pricewaterhousecoopers AS is the Group’s external auditor since October 8
th
, 2021. In 2022 the
external auditor has attended one Audit Committee meetings, shared information about the audit
plan and scope and provided the members of the Audit Committee with an opportunity to ask
questions.
CEO
Responsibility for the day-to-day management of the Group rests with the CEO, Nils Agnar
Brunborg, who, on a regular basis and upon request of the Board, informs the Board of Directors
about the status and development of the Group. The CEO is responsible for proposing the annual
budget, to be approved by the ultimate shareholder. He is also responsible for determining the
ordinary course of the business.
Page 16 | Jøtul AS annual report 2022
Page 17 | Jøtul AS annual report 2022
PricewaterhouseCoopers AS, Dronning Eufemias gate 71, Postboks 748 Sentrum, NO-0106 Oslo
T: 02316, org. no.: 987 009 713 MVA, www.pwc.no
Statsautoriserte revisorer, medlemmer av Den norske Revisorforening og autorisert regnskapsførerselskap
To the General Meeting of Jøtul AS
Independent Auditor’s Report
Report on the Audit of the Financial Statements
Opinion
We have audited the financial statements of Jøtul AS, which comprise:
• the financial statements of the parent company Jøtul AS (the Company), which comprise the
balance sheet as at 31 December 2022, the income statement and cash flow statement for the
year then ended, and notes to the financial statements, including a summary of significant
accounting policies, and
• the consolidated financial statements of Jøtul AS and its subsidiaries (the Group), which
comprise the statement of financial position as at 31 December 2022, and the statement of
comprehensive income, statement of changes in equity and statement of cash flows for the
year then ended, and notes to the financial statements, including a summary of significant
accounting policies.
In our opinion
• the financial statements comply with applicable statutory requirements,
• the financial statements give a true and fair view of the financial position of the Company as at
31 December 2022, and its financial performance and its cash flows for the year then ended in
accordance with Norwegian Accounting Act and accounting standards and practices generally
accepted in Norway, and
• the consolidated financial statements give a true and fair view of the financial position of the
Group as at 31 December 2022, and its financial performance and its cash flows for the year
then ended in accordance with International Financial Reporting Standards as adopted by the
EU.
Our opinion is consistent with our additional report to the Audit Committee.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the
Audit of the Financial Statements section of our report. We are independent of the Company and the
Group as required by relevant laws and regulations in Norway and the International Ethics Standards
Board for Accountants’ International Code of Ethics for Professional Accountants (including
International Independence Standards) (IESBA Code), and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit
Regulation (537/2014) Article 5.1 have been provided.
We have been the auditor of the Company for 2 years from the election by the general meeting of the
shareholders on 8 October 2021 for the accounting year 2021.
Page 18 | Jøtul AS annual report 2022
2 / 5
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial statements of the current period. These matters were addressed in the
context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
Key Audit Matters
Valuation of inventories
The book value of the Group’s inventory
amounts to NOK
440,381 thousand, which
represents approximately 3
3% of the Group’s
total asset
s at the balance sheet date.
Inventory
is valued at the lower of cost and
net reali
sable value, and consists of raw
materials, work in progress, finished goods
and spare parts and other inventories
.
We focused on this area due to the
material
amounts involved
, and because
of the level of
management judgement required in allocating
direct and indirect manufacturing costs, and in
estimating the inventory’s net realisable value.
We refer to note
15 for further details on the
inventory’s composition and provision for
obsolescence, as well as
note 2.6 regarding
the applied principles for valuation of
inventory.
We reviewed and evaluated management’s
principles for valuation of inventory, including
determination of estimated provision for
obsolescence.
We gained an understanding of management’s
processes for calculating manufacturing costs
related to work in progress and finished goods,
and for estimating the provision for obsolescence.
To test the recorded acquisition cost of raw
materials, we tested a sample of book values
against supporting invoices.
manufacturing costs of work in progress and
manufactured finished goods, we considered the
method used to calculate the manufacturing costs.
This also entailed
included as direct and indirect costs. Furthermore,
we tested the input data in the calculations against
incoming invoices and hourly rates used, and
performed independent analytical review
procedures over overhead costs.
We reviewed and evaluated management’s
method for identification and calculation of
obsolescence. Management’s method was based
on models where inventory turnover was a key
component. The models reflected previous
experience with turnover and obsolescence levels.
We challenged management by discussing the
total size of the booked obsolescence with them.
Through our presence at the inventory count we
checked whether damaged goods were identified,
assessed, and valued. Furthermore, we tested the
provision for obsolescence by checking booked
value against the specification of identified
obsolete goods including the overviews of goods
with low turnover. We tested the
accuracy of the turnover reports used as basis for
the calculation of obsolescence. We also
provision compared to previous years.
Page 19 | Jøtul AS annual report 2022
3 / 5
our procedures.
We read the relevant notes and found the
information and explanations provided consistent
and sufficient.
Other Information
The Board of Directors and the Managing Director (management) are responsible for the information
in the Board of Directors’ report and the other information accompanying the financial statements. The
other information comprises information in the annual report, but does not include the financial
statements and our auditor’s report thereon. Our opinion on the financial statements does not cover
the information in the Board of Directors’ report nor the other information accompanying the financial
statements.
In connection with our audit of the financial statements, our responsibility is to read the Board of
Directors’ report and the other information accompanying the financial statements. The purpose is to
consider if there is material inconsistency between the Board of Directors’ report and the other
information accompanying the financial statements and the financial statements or our knowledge
obtained in the audit, or whether the Board of Directors’ report and the other information
accompanying the financial statements otherwise appear to be materially misstated. We are required
to report if there is a material misstatement in the Board of Directors’ report or the other information
accompanying the financial statements. We have nothing to report in this regard.
Based on our knowledge obtained in the audit, it is our opinion that the Board of Directors’ report
• is consistent with the financial statements and
• contains the information required by applicable statutory requirements.
Our opinion on the Board of Director’s report applies correspondingly to the statements on Corporate
Governance and Corporate Social Responsibility.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation of financial statements that give a true and fair view in
accordance with the Norwegian Accounting Act and accounting standards and practices generally
accepted in Norway, and for the preparation and true and fair view of the consolidated financial
statements of the Group in accordance with International Financial Reporting Standards as adopted
by the EU, and for such internal control as management determines is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to fraud or
error.
In preparing the financial statements, management is responsible for assessing the Company’s and
the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern. The financial statements of the Company use the going concern basis of accounting insofar
as it is not likely that the enterprise will cease operations. The consolidated financial statements of the
Group use the going concern basis of accounting unless management either intends to liquidate the
Group or to cease operations, or has no realistic alternative but to do so.
Page 20 | Jøtul AS annual report 2022
4 / 5
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of
these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain
professional scepticism throughout the audit. We also:
• identify and assess the risks of material misstatement of the financial statements, whether due
to fraud or error. We design and perform audit procedures responsive to those risks, and
obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The
risk of not detecting a material misstatement resulting from fraud is higher than for one
resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
• obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's and the Group's internal control.
• evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
• conclude on the appropriateness of management’s use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Company's and the
Group's ability to continue as a going concern. If we conclude that a material uncertainty
exists, we are required to draw attention in our auditor’s report to the related disclosures in the
financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report.
However, future events or conditions may cause the Company and the Group to cease to
continue as a going concern.
• evaluate the overall presentation, structure and content of the financial statements, including
the disclosures, and whether the financial statements represent the underlying transactions
and events in a manner that achieves a true and fair view.
• obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the consolidated financial
statements. We are responsible for the direction, supervision and performance of the group
audit. We remain solely responsible for our audit opinion.
We communicate with the Board of Directors regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the Audit Committee with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
Page 21 | Jøtul AS annual report 2022
5 / 5
matters that may reasonably be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with the Board of Directors, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter or when, in extremely rare circumstances, we determine that a
matter should not be communicated in our report because the adverse consequences of doing so
would reasonably be expected to outweigh the public interest benefits of such communication.
Other Matters
The Company’s financial statements have been made public after the deadline for publication of
financial statements in section 5-5 of the Norwegian Securities Trading Act.
Report on Other Legal and Regulatory Requirements
Report on Compliance with Requirement on European Single Electronic Format (ESEF)
Opinion
As part of the audit of the financial statements of Jøtul AS, we have performed an assurance
engagement to obtain reasonable assurance about whether the financial statements included in the
annual report, with the file name Jotul-AS-2022-12-31-en, have been prepared, in all material
respects, in compliance with the requirements of the Commission Delegated Regulation (EU)
2019/815 on the European Single Electronic Format (ESEF Regulation) and regulation pursuant to
Section 5-5 of the Norwegian Securities Trading Act, which includes requirements related to the
preparation of the annual report in XHTML format, and iXBRL tagging of the consolidated financial
statements.
In our opinion, the financial statements, included in the annual report, have been prepared, in all
material respects, in compliance with the ESEF regulation.
Management’s Responsibilities
Management is responsible for the preparation of the annual report in compliance with the ESEF
regulation. This responsibility comprises an adequate process and such internal control as
management determines is necessary.
Auditor’s Responsibilities
For a description of the auditor’s responsibilities when performing an assurance engagement of the
ESEF reporting, see: https://revisorforeningen.no/revisjonsberetninger
Oslo, 4 May 2023
PricewaterhouseCoopers AS
Hallvard Helgetun
State Authorised Public Accountant
Page 22 | Jøtul AS annual report 2022
Jotul AS
Consolidated Financial Statements
for the year ended 31 December 2022
Consolidated statement of comprehensive income
(in NOK '000s)
Notes
2022
2021
Revenue
5
1,614,471
1,269,000
Other operating income
6
10,720
3,972
Total operating income
1,625,191
1,272,972
Raw materials and consumables
(714,280)
(559,852)
Changes in inventories of finished goods
and work in progress
30,483
13,225
Employee benefits expense
7
(361,927)
(307,829)
Depreciation, amortization and write-off
12,13,25
(75,448)
(86,685)
Other operating expense
8
(328,791)
(297,069)
Total operating expenses
(1,449,963)
(1,238,210)
Operating result
175,228
34,762
Finance income
9
5,152
8,412
Finance expense
10
(81,256)
(72,365)
Net finance cost
(76,104)
(63,953)
Profit / (loss) before income tax
99,124
(29,191)
Income tax
11
76,917
(5,563)
Net profit / (loss) for the year
176,041
(34,754)
Other comprehensive income/(loss)
Re-measurement of post-employment
benefit obligations
1,150
-
Foreign exchange differences on
translation of foreign operations
2,013
5,286
Other comprehensive income/(loss)
for the year net of tax
3,163
5,286
Total comprehensive income / (loss)
for the year
179,204
(29,468)
Page 23 | Jøtul AS annual report 2022
Jotul AS
Consolidated Financial Statements
for the year ended 31 December 2022
Consolidated statement of financial position
(in NOK '000s)
Notes
31 December
2022
31 December
2021
ASSETS
Non-current assets
Property, plant and equipment
12
107,740
118,043
Intangible assets
13
129,393
113,877
Right-of-use assets
25
225,008
239,733
Other receivables
14
7,725
9,585
Deferred tax asset
11
85,847
1,269
Total non-current assets
555,713
482,507
Current assets
Inventories
15
440,381
352,567
Trade and other receivables
16
200,722
203,294
Other receivables
14
2,934
2,962
Current income tax receivable
398
4,433
Cash and cash equivalents
17
131,096
108,257
Total current assets
775,531
671,513
Total assets
1,331,244
1,154,020
Page 24 | Jøtul AS annual report 2022
Jotul AS
Consolidated Financial Statements
for the year ended 31 December 2022
Consolidated statement of financial position (continued)
(in NOK '000s)
Notes
31 December
2022
31 December
2021
EQUITY AND LIABILITIES
Equity
Share capital
18
139,414
139,414
Share premium
1,026,612
1,026,612
Foreign currency translation reserve
17,165
15,152
Re-measurement of post-employment
benefit obligations
1,150
-
Retained earnings
(1,104,641)
(1,280,682)
Total equity
79,700
(99,504)
Non-current liabilities
Senior secured bonds
19
466,057
461,861
Lease liabilities
25
267,317
285,088
Borrowings
20
29,847
27,476
Government grant
20
1,809
2,547
Deferred tax liability
11
186
1,967
Long-term provisions
23
8,739
10,395
Total non-current liabilities
773,955
789,334
Current liabilities
Lease liabilities
25
53,994
48,721
Loan from shareholder
21
33,568
30,551
Bank borrowing
17
-
17,198
Government grant
20
1,583
1,441
Trade and other payables
22
370,065
348,290
Short-term provisions
23
2,176
4,154
Accrued interest on bonds
19
11,626
8,713
Current income tax payable
4,577
5,122
Total current liabilities
477,589
464,190
Total equity and liabilities
1,331,244
1,154,020
18
Page 25 | Jøtul AS annual report 2022
Page 26 | Jøtul AS annual report 2022
Jotul AS
Consolidated Financial Statements
for the year ended 31 December 2022
Consolidated statement of changes in equity
(in NOK '000s)
Share
capital
Share
premium
Foreign currency
translation
reserve
Re-measurement of
post-employment
benefit obligations
Retained
earnings
Total
Balance as at 1 January 2021
139,414
1,026,612
9,866
-
(1,245,928)
(70,036)
Loss for the year
-
-
-
-
(34,754)
(34,754)
Other comprehensive income for
the year
-
-
5,286
-
-
5,286
Total comprehensive loss
-
-
5,286
-
(34,754)
(29,468)
Balance as at 31 December 2021
139,414
1,026,612
15,152
-
(1,280,682)
(99,504)
(in NOK '000s)
Share
capital
Share
premium
Foreign currency
translation
reserve
Re-measurement of
post-employment
benefit obligations
Retained
earnings
Total
Balance as at 1 January 2022
139,414
1,026,612
15,152
-
(1,280,682)
(99,504)
Profit for the year
-
-
-
-
176,041
176,041
Other comprehensive income for
the year
-
-
2,013
-
-
2,013
Re-measurement of post-
employment benefit obligations
-
-
-
1,150
-
1,150
Other comprehensive income for
the year
-
-
2,013
1,150
-
3,163
Total comprehensive profit
-
-
2,013
1,150
176,041
179,204
Balance as at 31 December 2022
139,414
1,026,612
17,165
1,150
(1,104,641)
79,700
Page 27 | Jøtul AS annual report 2022
Jotul AS
Consolidated Financial Statements
for the year ended 31 December 2022
Consolidated statement of cash flows
(in NOK '000s)
Notes
31
December
2022
31
December
2021
Cash flows from operating activities
Net profit/(loss) for the year
176,041
(34,754)
Adjustments for:
Income tax recognized in profit or loss
11
(76,917)
5,563
Depreciation and impairment
12,13,25
75,448
86,685
Net finance costs
9,10
76,104
63,953
Changes in operating working capital
(50,516)
(102,756)
Cash generated from operating activities
200,160
18,691
Interest paid on senior secured bonds
19
(40,151)
(76,937)
Interest paid on shareholder loan
21
-
(18,100)
Interest paid on leasing
25
(13,792)
(14,825)
Other interest paid
(14,208)
(15,746)
Interest received
797
80
Income tax paid
(8,043)
(5,576)
Income tax received
-
-
Net cash flows from operating activities
124,763
(112,413)
Cash flows from investing activities
Purchase of property, plant and equipment
12
(13,729)
(8,835)
Purchase of intangible assets
13
(32,142)
(26,501)
Acquisition of subsidiaries, net of cash acquired
-
(3,620)
Proceeds from disposal of property, plant and equipment
-
-
Proceeds from disposal of intangible assets
-
-
Net cash flows used in investing activities
(45,871)
(38,956)
Cash flows from financing activities
Proceeds from issuance of bonds
-
382,299
Repayment of borrowings
-
(247,635)
Proceeds from borrowings
-
76,370
Proceeds from Bank borrowing
(17,198)
(1,442)
Payment of principal portion of lease liability
25
(38,855)
(36,982)
Net cash flows from financing activities
(56,053)
172,610
Net increase/(decrease) in cash and cash equivalents
22,839
21,241
Cash and cash equivalents at the beginning of the year
108,257
88,465
Exchange gains on cash and cash equivalents
-
(1,449)
Cash and cash equivalents at the end of the year
17
131,096
108,257
Page 28 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
Notes to the consolidated financial statements
1. GENERAL INFORMATION
Jotul AS (hereinafter the “Company”) was incorporated in 2006. The Company is registered with
the organization number 989 519 247.
The Company and the subsidiaries are referred to in these consolidated financial statements as
the “Group”.
The Group manufactures, distributes and sells wood-burning stoves, wood-burning fireplaces,
gas-burning stoves, gas-burning fireplaces and auxiliary equipment for these via distributors,
importers and subsidiaries. The Group has manufacturing facilities in Norway, Poland, the United
States of America and France, and it sells its products in approximately 45 countries.
The Group’s financial year starts on 1 January and ends on 31 December of each year.
2. SIGNIFICANT ACCOUNTING POLICIES
The consolidated financial statements have been prepared in accordance with International
Financial Reporting Standards (“IFRS”) as adopted in the European Union.
2.1 Basis of preparation
The consolidated financial statements are prepared under the historical cost basis, except for
certain financial instruments which are measured at fair value.
These consolidated financial statements present the consolidated statement of cash flows using
the indirect method.
The consolidated financial statements are presented in Norwegian Krone (“NOK”).
Going concern
The board of directors have assessed going concern basis by considering financial performance
and forecasts of the Group as well as the following:
- The Group has successfully refinanced the Senior secured bonds in October 2021 for a
period of three years. Simultaneously, the Group has also successfully renewed its
Revolving Credit Facility (RCF) with Nordea bank, with total available credit of 75m NOK,
to be used for working capital purposes as additional resourced to regulate the seasonality
lows.
- FY2022 revenues are 27% higher than last year and 8% higher than budget, driven by
strong market dynamics and improved output performance.
Page 29 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
- The order book as of December 2022 is 110% higher than last year, paving the way for
continued favorable revenue development in 2023. The growth and demand are in
particular strong for our wood stoves portfolio, which is the core of our product offering.
Key driver for the strong market is mainly the high price of electricity and natural gas,
which is leading to the increasing use of wood as alternative or complementary heating
resource. These market conditions are expected to remain throughout 2023 and most of
2024.
- The inflationary development on the cost side, noted throughout the past two years as part
of the post-Covid-confinement recovery, followed by the effects of the energy crisis, is
expected to be less significant in 2023. Nevertheless, the market proved ability to recover
such cost in-creases via selling price increases, allowing the Group to successfully defend
its margins.
- The factory in Poland, which started operations in early 2020, stabilized throughout late
2020 and in 2021, and the Group now sees more mature and efficient manufacturing
operations.
- The revenues in 2023 are estimated to exceed the 2022 level. The order intake is expected
to remain very strong, driven by strong demand in all the Group’s main markets in
particular for wood burning stoves. While considering, on top of this, the matured
operations and continued efficiency improvement projects, the Group estimates strong
financial performance in 2023.
With the current Group performance, the favorable business outlook, and the conclusion of the
refinancing exercise, it is the board of directors’ expectation that the Group will have adequate
resources to continue trading for the foreseeable future.
In the Board’s opinion, the consolidated financial statements provide a true and fair view of the
Company’s and Group’s financial position and results.
2.2 Foreign currency translation
(a) Foreign currency transactions and balances
Transactions in foreign currencies are translated at the foreign exchange rate ruling at the date
of the transaction. Monetary assets and liabilities denominated in foreign currencies at the
statement of financial position date are translated at the foreign exchange rate ruling at that date.
Foreign exchange differences are recognized in the Finance expense or Finance income. Non-
monetary assets and liabilities that are measured in terms of historical cost in a foreign currency
are translated using the exchange rate at the date of the transaction. Non-monetary assets and
liabilities denominated in foreign currencies that are stated at fair value are translated at foreign
exchange rates ruling at the dates the fair value was determined.
Page 30 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
(b) Group companies
The income statement and balance sheet for Group entities with a functional currency that differs
from the presentation currency are translated as follows:
i. the balance sheet is translated at the end-rate at the statement of financial position date
ii. the income statement is translated at the average monthly rates (if the average exchange
rate does not give a reasonable estimate of the accumulated effect of using the transaction
date exchange rate, then the transaction date exchange rate is used)
iii. currency translation differences are recognized in other comprehensive income and as a
separate reserve within equity.
During the year ended 31 December 2021 and 2022, the following exchange rates were used:
2022
2021
Currency*
Closing
Average
Closing
Average
EUR/NOK
10.5522
10.1128
9.9888
10.1735
USD/NOK
9.9066
9.6198
8.8363
8.5979
GBP/NOK
11.9556
11.8613
11.9358
11.8269
SEK/NOK
0.9474
0.9514
0.9738
1.003
PLN/NOK
2.2462
2.1568
2.1729
2.2273
DKK/NOK
1.4190
1.3591
1.3435
1.3679
*United States Dollar (USD), Euro (EUR), Pound Sterling (GBP), Swedish Krona (SEK), Polish
złoty (PLN) and Danish Krone (DKK).
2.3 Consolidation principles
The consolidated financial statements as at 31 December 2022 include the accounts of the
Company and those of all directly or indirectly controlled subsidiaries.
2.3.1 Subsidiaries
Subsidiaries are all entities over which the Group exercises control. Control exists when the
company has power, directly or indirectly, over an entity, is exposed, or has rights, to variable
returns from its involvement with the entity and has the ability to affect those returns through its
power over the entity.
Subsidiaries are fully consolidated from the date on which control is transferred. They are no
longer consolidated from the date that control ceases. When the Group loses control over a
subsidiary, it derecognizes the assets and liabilities of the subsidiary, and any related components
of net assets. Any resulting gain or loss is recognized in profit and loss.
Page 31 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
According to IFRS 3, business combination is accounted for using the acquisition method as at
the acquisition date which is the date on which control is transferred to the Group. The Group
measures the identifiable assets acquired and the liabilities assumed at fair values. Expenses
related to the business combination are expensed as incurred. The consideration transferred is
measured at the fair value, which is the sum of the assets transferred, obligations assumed, and
equity instruments issued. Contingent consideration is recognized at fair value as part of the
consideration transferred.
If the total of the consideration transferred and the fair value of previously held ownership interest
exceeds the fair value of identifiable net assets in the acquired company, the difference is
recognized as goodwill. If the total is less than the net assets of the company, the difference is
recognized as bargain purchase in the income statement.
Intra-group transactions, balances, income and expenses are eliminated as well as elements of
gains and losses related to an asset that has been recognized as a result of a group transaction.
The financial statements of the subsidiaries are, if necessary, re-stated to conform with the
Group’s accounting policies.
Accounting for business combinations under IFRS 3 does not apply to business combinations
between entities under common control. A business combination involving entities under common
control is a business combination in which all of the combining entities or businesses are
ultimately controlled by the same party or parties both before and after the business combination,
and that control is not transitory.
In this case, the Group applies acquisition method in accordance with IFRS 3 that is described
above.
2.3.2 Scope of consolidation
Entities included in the scope of consolidation that are fully consolidated are listed below:
Subsidiary
Registered office
% ownership
Functional
currency
2022
2021
Jotul AS
Kråkerøy, Norway
100%
100%
NOK
Jotul North America Inc.
Portland, United States
100%
100%
USD
Jotul France SAS
Dardilly, France
100%
100%
EUR
Jotul UK Ltd.
Worcestershire, England
100%
100%
GBP
Jotul Hispania
Zaragosa, Spain
100%
100%
EUR
Scan AS
Vissenbjerg, Denmark
100%
100%
DKK
Jotul Italia S.R.L.
Milano, Italy
100%
100%
EUR
Jotul Poland Sp. z o.o.
Katy Wroclawskie, Poland
100%
100%
PLN
Aico France SAS
Bron, France
100%
100%
EUR
Aico S.p.A.*
Milano, Italy
100%
100%
EUR
*The company has been acquired on 1 June 2021.
Page 32 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
2.4 Property, plant and equipment
Property, plant and equipment are recognized at cost less accumulated depreciation and
impairment. Cost includes all costs necessary to bring the asset to working condition for its
intended use. Assets are capitalized if it has a cost price of more than NOK 15,000.
Subsequent expenditure is added to the carrying value of the fixed asset, or recognized
separately, when it is probable that the future economic benefits related to the addition will flow
to the Group, and the cost can be measured reliably. The carrying value of replaced parts is
expensed. Other repair and maintenance costs are expensed as incurred.
Depreciation is recognized on a straight-line basis over the expected useful lives of the asset as
follows:
Land: nil
Buildings 25-40 years
Machinery 10-15 years
Vehicles 3-5 years
Equipment and fittings 3-8 years
Depreciation is not provided on assets during their construction.
Depreciation methods and useful lives, as well as residual values, are reassessed annually.
Carrying values are reviewed for impairment when events or changes in circumstances indicate
that the carrying value may not be recoverable. When the carrying value of a fixed asset is higher
than its estimated recoverable amount, the asset value is written down to the recoverable amount.
An item of property, plant and equipment is derecognized on disposal or when no future economic
benefits are expected from its use. Any gain or loss on disposals are included in profit or loss
when incurred.
2.5 Intangible assets
Intangible assets include trademarks, customer relationships, software, development costs and
production rights. Those intangible assets acquired in a business combination are recorded
initially at fair value and are amortized on a straight-line basis.
Expenditure on research and development activities, undertaken with the prospect of gaining new
scientific or technical knowledge and understanding, and expenditure on internally generated
goodwill and brands are expensed as incurred. Expenditure on development activities, whereby
research findings are applied to a plan or design for the production of new or substantially
improved products and processes, is capitalized if the product or process is technically feasible,
costs can be reliably measured, future economic benefits are feasible, and the Group intends to
and has sufficient resources to complete development and made the decision to use or sell the
asset. The expenditure capitalized includes the cost of materials, direct labour and an appropriate
proportion of overheads.
Page 33 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
Other development expenditure is expensed as incurred. Capitalized development expenditure is
measured at cost less accumulated amortization and impairment losses.
Intangible assets with definite useful lives are amortized on a straight-line basis over the estimated
useful economic life and assessed for impairment whenever there is an indication that the
intangible asset may be impaired. Intangible assets with indefinite useful lives are tested annually
for impairment. If the carrying amount exceeds the recoverable amount, an impairment loss will
be recognized. If an intangible asset with an indefinite life has changed to a definite life the change
is made on a prospective basis. The expected useful lives are as follows:
Trade names Indefinite useful life
Customer relationships 8 years
Software 3-5 years
Research and development costs 3-10 years
2.6 Inventory
Inventories are carried at the lower of cost and net realizable value. The cost of inventories
comprises all costs of purchase, costs of conversion and other costs incurred in bringing the
inventories to their present location and condition. The cost of inventories is assigned using the
first-in, first-out (FIFO) method. For finished goods and work in progress, acquisition cost consists
of expenditure for product design, materials used, direct payroll costs, other direct costs and
indirect manufacturing costs (based on normal capacity). Net realizable value is the estimated
sales price less estimated costs to complete and selling costs.
2.7 Impairment of non-financial assets
The carrying amounts of the Group’s non-financial assets, other than inventories and deferred tax
assets, are annually reviewed for impairment. If any such indication exists, then the asset’s
recoverable amount is estimated. The recoverable amount of an asset or cash-generating unit is
the greater of its value-in-use and its fair value less costs to sell. In assessing value-in-use, the
estimated future cash flows are discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of money and the risks specific to the
asset.
An impairment loss is recognized if the asset’s carrying amount exceeds its estimated recoverable
amount. An impairment loss is reversed if there has been a change in the estimates used to
determine the recoverable amount. An impairment loss is reversed only to the extent that the
asset’s carrying amount does not exceed the carrying amount that would have been determined,
net of depreciation or amortization, if no impairment loss had been recognized. Goodwill
impairment is not reversed.
Page 34 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
2.8 Financial assets
The Group classifies its financial assets in the following categories: at fair value through profit or
loss (“FVTPL”) and measured at amortized cost.
A financial asset is measured at amortized cost if it meets both of the following conditions and is
not designated as at FVTPL:
● it is held within a business model whose objective is to hold assets to collect contractual cash
flows; and
● its contractual terms give rise on specified dates to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
This category includes the Group’s trade and other receivables not subject to the factoring
agreement.
All financial assets not classified as measured at amortized cost as described above are
measured at FVTPL. This includes all derivative financial assets. The Group uses foreign
currency forwards to hedge its risks associated with foreign exchange rates. Financial assets
classified as at FVTPL are subsequent to initial recognition, measured at fair value with changes
in fair value recognized in profit or loss.
Financial assets are not reclassified subsequent to their initial recognition unless the Group
changes its business model for managing financial assets, in which case all affected financial
assets are reclassified on the first day of the first reporting period following the change in the
business model.
2.9 Cash and cash equivalents
For the purpose of the statement of cash flows, cash and cash equivalents comprise cash on
hand, deposits held on call with banks all of which are available for use by the Group unless
otherwise stated.
2.10 Impairment of financial assets
Financial assets not carried at FVTPL (e.g. trade receivables) are annually assessed to determine
whether there is any objective evidence that it is impaired using the forward-looking expected
credit loss (“ECL”) approach. A financial asset is considered to be impaired if objective evidence
indicates that one or more events have had a negative effect on the estimated future cash flows
of the assets that can be estimated reliably. An impairment loss in respect of a financial asset
measured at amortized cost is calculated as the difference between the carrying amount, and the
present value of the estimated future cash flows discounted at the asset’s original effective
interest rate. The Group applies the simplified approach calculate ECLs based on lifetime
expected credit losses. An impairment loss is reversed if the reversal can be related objectively
to an event occurring after the impairment loss was recognized. All impairment losses and
impairment loss reversals are recognized in profit or loss.
Page 35 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
2.11 Financial liabilities
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that
are directly attributable to the acquisition or issue of financial assets and financial liabilities (other
than financial assets and financial liabilities at fair value through profit or loss) are added to or
deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial
recognition. Transaction costs directly attributable to the acquisition of financial assets or financial
liabilities at fair value through profit or loss are immediately recognized in profit or loss.
Financial liabilities are classified at FVTPL when the financial liability is held for trading and when
it is designated as at FVTPL because it forms part of a contract containing one or more embedded
derivatives and IFRS 9 permits the entire combined contract to be designated at FVTPL and also
when the financial liability forms part of a group of financial assets and financial liabilities which is
managed, and its performance is evaluated on a fair value basis. All transaction cost related to
financial liabilities at FVTPL are expensed as incurred.
Derivatives are only used for economic hedging purposes and not as speculative investments.
However, where derivatives do not meet the hedge accounting criteria, they are classified as ‘held
for trading’ for accounting purposes and are accounted for at fair value through profit or loss. They
are presented as current assets or liabilities to the extent they are expected to be settled within
12 months after the end of the reporting period.
Changes in the fair value of the financial liabilities designated at FVTPL are presented in profit or
loss except when the amount of changes in the fair value is attributable to change in credit risk of
that liability, for which it is recognized in other comprehensive income, unless the recognition of
the effects of changes in the liability’s credit risk in other comprehensive income would create or
enlarge an accounting mismatch in profit or loss. Changes in fair value attributable to financial
liability’s credit risk are not subsequently reclassified to profit or loss but are transferred to retained
earnings when the financial liability is derecognized.
All other borrowings are subsequently stated at amortized cost. Any difference between the
proceeds (net of transaction costs) and the redemption value is recognized as finance cost over
the period of the borrowings using the effective interest method.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer
settlement of the liability for at least 12 months after the statement of financial position date.
2.12 Trade and other payables
Trade payables are obligations to pay for goods or services that have been acquired in the
ordinary course of business from suppliers. Trade and other payables are classified as current
liabilities if payment is due within one year or less (or in the normal operating cycle of the business
if longer). If not, they are presented as non-current liabilities.
Trade payables are initially recognized at fair value and subsequently measured at amortized cost
using the effective interest method.
Page 36 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
2.13 Equity
Ordinary shares are classified as equity. Expenses directly attributable to the issue of new shares
or options, net of tax, are recognized in equity as a reduction of the consideration received.
Currency translation differences are recognized as part of other comprehensive income as a
separate line item in the statement of changes in equity.
2.14 Provisions
Provisions are recognized when the Group has a present legal or constructive obligation, as a
result of past events. The amount recognized represent management’s best estimate of the
expenditures that will be required to settle the obligation as of the reporting date Provisions are
measured by discounting the expected future cash flows at a pre-tax rate that reflects the current
market assessments of the time value of money and the risks specific to the liability.
A provision for restructuring is recognized when the Group has approved a detailed and formal
restructuring plan, and the restructuring has either commenced or has been announced publicly.
Costs relating to the ongoing activities of the Group are not provided for.
Provisions for the expected cost of warranty obligations under local sale of goods legislation are
recognized at the date of sale of the relevant products, at the directors’ best estimate of the
expenditure required to settle the Group’s obligation.
Payments to defined contribution retirement benefit plans are recognized as an expense when
employees have rendered service entitling them to the contributions. Payments made to state
managed retirement benefit plans are accounted for as payments to defined contribution plans
where the Group’s obligations under the plans are equivalent to those arising in a defined
contribution retirement benefit plan.
2.15 Revenue
The Group manufactures, distributes and sells wood-burning stoves, wood-burning fireplaces,
gas-burning stoves, gas-burning fireplaces and auxiliary equipment for these via distributors,
importers and subsidiaries. The Group has manufacturing facilities in Norway, Poland, the USA
and France, and sells its products in approximately 45 countries. The revenue streams consist
solely of the sale of goods to various customers (dealers and/ or distributors) in a range of
markets.
The Group has agreements with dealers who market and sell the products. Based on these
agreements, the dealers place orders for stoves and accessories and each of these orders
represent distinct deliveries which are recognized separately.
The price charged by the Group for sale of the products to the dealers is based on the Group’s
guiding price list in the market, less agreed discounts. The transaction price does not include any
non-cash consideration.
Page 37 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
Variable consideration relates to discounts (performance bonus) on achievement of specified
milestones. There are fixed discounts to dealers which are recognized immediately, and there is
a variable part represented by growth bonuses, as well as yearly or quarterly bonuses. They are
estimated based on actual customer sales volume. The variable part is classified as reduction of
revenues.
The Group has a 5-year warranty for all its stoves, limited to external cast iron parts and sheet
steel parts, according to law. For internal parts there is a 2-year warranty according to law. This
warranty is not treated as a separate performance obligation and is accounted in accordance with
IAS 37 as a provision. The Group does allow good returns unless they fall under warranty.
The consideration payable to a customer is accounted for as a reduction of revenues and is
recognized for expected volume discounts payable to customers in relation to sales made until
the end of the reporting period.
Revenue from contracts with customers is recognized when control of the goods or services are
transferred to the customer at an amount that reflects the consideration to which the Group
expects to be entitled in exchange for those goods or services. The Group has generally
concluded that it is the principal in its revenue arrangements because it typically controls the
goods or services before transferring them to the customer.
Generally, revenue is thus recognized on delivery of the goods. The Group uses either EXW (“Ex
Works”) or DDP (“Delivery Duty Paid”) Incoterms delivery conditions.
For EXW orders the transfer of control of the asset is at shipping point. When shipping EXW
orders the dealers organize pick up of the stoves and accessories, and let the Group know when
their trucks will arrive at the warehouse to pick up the goods. The Group recognizes the revenue
when the truck leaves the warehouse. For DDP control of the goods is transferred upon the
delivery to the dealer.
The normal credit term is 30 to 90 days upon delivery. Using the practical expedient in IFRS 15,
the Group does not adjust the promised amount of consideration for the effects of a significant
financing component if it expects, at contract inception, that the period between the transfer of
the promised good or service to the customer and when the customer pays for that good or service
will be one year or less.
The Group does not have any incremental cost when entering into a new dealer agreement.
2.16 Income tax
Income tax expense comprises current tax and deferred tax. Income tax expense is recognized
in profit or loss, except when it relates to items recognized directly in equity, in which case it is
recognized in other comprehensive income.
Page 38 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted
or substantively enacted in the countries where the Group’s entities operate and generate taxable
income at the reporting date.
Deferred tax is calculated on all temporary differences between the tax bases of assets and
liabilities and the Group carrying amounts of assets and liabilities. Deferred tax is determined
using the tax rates and tax laws enacted or substantively enacted as at the reporting date.
Deferred tax assets are recognized to the extent that it is probable that taxable profits will be
available.
2.17 Leases
For any new contracts entered into on or after 1 January 2019, the Group considers whether a
contract is, or contains a lease. A lease is defined as ‘a contract, or part of a contract, that conveys
the right to use an asset (the underlying asset) for a period of time in exchange for consideration’.
To apply this definition the Group assesses whether the contract meets three key evaluations
which are whether:
- The contract contains an identified asset, which is either explicitly identified in the contract
or implicitly specified by being identified at the time the asset is made available to the
Group;
- The Group has the right to obtain substantially all of the economic benefits from use of the
identified asset throughout the period of use, considering its rights within the defined scope
of the contract;
- The Group has the right to direct the use of the identified asset throughout the period of
use.
Assets and liabilities arising from a lease are initially measured on a present value basis.
Lease payments include fixed payments (including in-substance fixed payments), less any lease
incentives receivable, variable lease payment that depend on an index or a rate, and amounts
expected to be paid by the Group under residual value guarantees. The lease payments also
include the exercise price of a purchase option if the Group is reasonably certain to exercise that
option, and payments of penalties for terminating the lease, if the lease term reflects the Group
exercising that option.
Lease payments to be made under reasonably certain extension options are also included in the
measurement of the liability.
The lease term begins at the commencement date and includes any rent-free periods provided to
the lessee by the lessor.
The lease payments are discounted using the lessee’s incremental borrowing rate (the “IBR”)
being the rate that the individual lessee would have to pay to borrow the funds necessary to obtain
an asset of similar value to the right-of-use asset in a similar economic environment with similar
terms, security and conditions.
Page 39 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
To determine the incremental borrowing rate, the Group uses a build-up approach that starts with
a risk-free interest rate adjusted for credit risk and makes adjustments specific to the lease.
Considering that vast majority of lease payments relate to real estate leases, the lease specific
adjustment is determined for these lease contracts. The same lease specific adjustment is applied
to other lease contracts which share the same characteristics in terms of risk-free interest rate
and credit risk.
Lease payments are allocated between principal and finance cost. The finance cost is charged to
profit or loss over the lease period so as to produce a constant periodic rate of interest on the
remaining balance of the liability for each period.
Right-of-use assets are measured at cost less any accumulated depreciation and impairment
losses and adjusted for any re-measurement of lease liabilities. Right-of-use assets include the
amount of the lease liability recognized, any lease payments made at or before the
commencement date less any lease incentives received, any initial direct costs, and restoration
costs.
Right-of-use assets are depreciated on a straight-line basis over the shorter of the asset’s
estimated useful life and the lease term. Right-of-use assets are subject to impairment, as
described in note 2.7.
Payments associated with short-term leases of equipment and vehicles and all leases of low-
value assets are recognized on a straight-line basis as an expense in profit or loss. Short-term
leases are leases with a lease term of 12 months or less. Low-value assets comprise IT equipment
and small items of office furniture having value when new below USD 5 thousand (equivalent of
NOK 44 thousand).
The Group is exposed to potential future increases in variable lease payments based on an index
or rate, which are not included in the lease liability until they take effect. When adjustments to
lease payments based on an index or rate take effect, the lease liability is reassessed and
adjusted against the right-of-use asset.
Variable lease payments that do not depend on an index or rate are not included in the
measurement the lease liability and the right-of-use asset. The related payments are recognized
as an expense in the period in which the event or condition that triggers those payments occurs
and are included in profit or loss.
For contracts that contain a lease component and one or more additional lease or non-lease
components, the Group allocates the consideration in the contract to each lease component on
the basis of the relative stand-alone price of the lease component and the aggregate stand-alone
price of the non-lease components.
In 2020, the Group has adopted the practical expedient whereby it has not accounted for rent
concessions which are directly consequence of the COVID-19 pandemic as lease modifications.
Page 40 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
2.18 Government grants
Government grants are recognized where there is reasonable assurance that the grant will be
received, and all attached conditions will be complied with. Government grants relating to costs
are deferred and recognized in profit or loss as a reduction of related expenses over the period
necessary to match them with the costs that they are intended to compensate.
Government loan at a below-market rate of interest is treated as government loan and shall be
recognized and measured in accordance with IFRS 9. The benefit of such rate shall be measured
as the difference between the initial carrying value of the loan determined in accordance with
IFRS 9 and the proceed received. The related benefit is recognized as a compensation in the
profit or loss.
2.19 Segment reporting
An operating segment is a component of the Group that engages in business activities from which
it may earn revenues and incur expenses. An operating segment is also a component of the
Group whose operating results are reviewed regularly by the entity’s Chief Operating Decision
Maker (“CODM”) to make decisions about resources to be allocated to the segment and assess
its performance.
Chief Executive Officer and Chief Financial Officer of the Group are identified as its CODM, which
is the individual or body of individuals responsible for the allocation of resources and assessment
of performance of the operating segments.
The operating segments were identified on the basis of the internal reports used by management
to allocate resources to the segments and assess their performance. Operating segments of the
Group represent geographical segments which are engaged in operations in individual countries
or group of countries.
Management of the Group has identified four reportable segments which represent Norway, North
America, Poland and France. Segment “Other” aggregates operations in Great Britain, Spain,
Italy and Denmark.
2.20 Fair value measurement
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an
orderly transaction between market participants at the measurement date. The fair value
measurement is based on the presumption that the transaction to sell the asset or transfer the
liability takes place either:
● In the principal market for the asset or liability, or
● In the absence of a principal market, in the most advantageous market for the asset or liability.
All assets and liabilities for which fair value is measured or disclosed in the financial statements
are categorized within the fair value hierarchy. The different levels have been defined as follows:
● Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities;
● Level 2 - Valuation techniques for which the lowest level input that is significant to the fair
value measurement is directly or indirectly observable; and
Page 41 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
● Level 3 - Valuation techniques for which the lowest level input that is significant to the fair
value measurement is unobservable.
2.21 New and revised standards
2.21.1 Adoption of new and revised standards
A number of new or amended standards became applicable for the current reporting period. The
Group did not have to change its accounting policies or make retrospective adjustments as a
result of adopting these standards.
The amendments which are effective from 1 January 2022 that do not have material impact on
the consolidated financial statements:
● Amendments to IFRS 3 Business combinations – reference to Conceptual Framework;
Effective 1 January 2022;
● Amendments to IAS 16 Property, Plant and Equipment: Proceeds before Intended
Use; Effective 1 January 2022;
● Amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets:
Onerous Contracts – Cost of Fulfilling a Contract; Effective 1 January 2022;
● Annual improvements to the standards: Improvement cycle 2018 – 2020; Effective 1
January 2022.
2.21.2 New standards, amendments and interpretations issued but not yet effective
Amendments which are effective for the financial periods starting from and after 1 January 2023
and which are not expected to have a material impact on the financial statements:
● IFRS 17 Insurance Contracts (including amendments); Effective 1 January 2023;
● Amendments to IAS 1 Presentation of Financial Statements Classification of
Liabilities as Current or Non-current; Effective 1 January 2024;
● Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice
Statement 2: Disclosure of Accounting policies; Effective 1 January 2023;
● Amendments to IAS 8 Accounting policies, Changes in Accounting Estimates and
Errors: Definition of Accounting Estimates; Effective 1 January 2023;
● Amendments to IAS 12 Deferred Tax related to Assets and Liabilities arising from a
Single Transaction; Effective 1 January 2023;
● Amendments to IFRS 16 Leases: Lease Liability in a Sale and Lease back (issued on
22 September 2022); Effective 1 January 2024.
The standards will be adopted at the effective dates.
*Not yet endorsed by European Financial Reporting Advisory Group
Page 42 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
2.22 Use of estimates and judgements
The preparation of financial statements requires Management to make judgements, estimates
and assumptions that affect the application of policies and reported amounts of assets and
liabilities, income and expenses. The estimates and associated assumptions are based on
historical experience and various other factors that are considered to be relevant. Actual results
may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognized in the period in which the estimate is revised if the revision
affects only that period, or in the period of the revision and future periods if the revision affects
both current and future periods.
In particular, information about significant areas of estimation, uncertainty and critical judgements
in applying accounting policies that have the most significant effect on the amounts recognized in
the financial statements is included below:
Deferred tax assets
The Group records deferred tax assets and liabilities based on the differences between the
carrying amount of assets and liabilities in the financial statements and the corresponding tax
bases. Deferred tax assets are also recognized for the estimated future effects of tax losses
carried forward to the extent that it is probable that taxable profit will be available against which
the losses can be utilized.
Significant management judgement is required to determine the amount of deferred tax assets
that can be recognized. The Group reviews the deferred tax assets in the different jurisdictions in
which it operates periodically to assess the possibility of realizing such assets based on projected
taxable profit, the expected timing of the reversals of existing temporary differences, the carry
forward period of temporary differences and tax losses carried forward and the implementation of
tax-planning strategies.
Impairment of trademarks
Trademarks held by the Group represent intangible assets with indefinite useful lives and as such
are subject to annual impairment test. The impairment testing requires application of certain
assumptions and judgements as described in Note 13.
Other areas that involve significant estimates or judgements
- estimation uncertainties and judgements made in relation to lease accounting
- estimated useful life of intangible assets
- impairment of property, plant and equipment, intangible assets with definite useful life
and right-of-use assets
- estimation of provisions, including inventory obsolescence provision when inventory is
not used or sold for a long period of time and is not expected to be sold in the future (
this type of inventory has to be written down and evaluated for write-off), and accounts
receivable provisions related to non-collection risks.
Page 43 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
3. FINANCIAL RISK MANAGEMENT
The Group’s activities expose it to a variety of financial risks such as market risk (interest rate
risk, currency risk) liquidity risk and credit risk.
The Group’s aim is to achieve an appropriate balance between risk and return and minimize
potential adverse effects on the Group’s financial performance. The Group’s risk management
policies are designed to identify and analyze these risks, to set appropriate risk limits and controls,
and to monitor the risks and adherence to limits by means of reliable and up-to-date information
systems. Management regularly reviews its risk management policies and systems to reflect
changes in markets, products and emerging best practices. Financial risk management is carried
out by various operating units under policies approved by the Board of Directors.
3.1 Market Risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest
rates and equity prices which will affect the Group’s income or the value of its holdings of financial
instruments. The objective of market risk management is to manage and control market risk
exposures within acceptable parameters, while optimizing the return.
3.1.1 Interest rate risk
Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate due to
changes in market interest rates. The Group’s main interest rate risk arises from financial
instruments with variable interest rates, which expose the Group to cash flow interest rate risk.
The following financial instruments are exposed to interest rate risk:
Nominal amount
(in NOK '000s)
31 December 2022
31 December 2021
Loan receivable
8,550
10,800
Senior secured bonds
475,000
475,000
The following table demonstrates the sensitivity to a reasonably possible change in 3-month
NIBOR interest rates, with all other variables held constant, on the Group’s profit before tax
(through the impact on floating rate borrowings):
31 December 2022
Effect on profit before tax
(in NOK '000s)
10% increase
10% decrease
Loan receivable
28
(28)
Senior secured bonds
1,558
(1,548)
Page 44 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
31 December 2021
Effect on profit before tax
(in NOK '000s)
10% increase
10% decrease
Loan receivable
10
(10)
Senior secured bonds
461
(451)
3.1.2 Currency risk
Foreign currency risk is the risk that that the fair value of future cash flows of a financial instrument
will fluctuate because of changes in foreign exchanges rates.
The Group has international operations and is exposed to foreign exchange risk in several
currencies. This risk is particularly relevant for United States Dollar (USD), Euro (EUR), Pound
Sterling (GBP), Swedish Krona (SEK), Polish złoty (PLN) and Danish Krone (DKK). Currency risk
arises from trading transactions, recognized assets and liabilities, and net investments in foreign
operations.
The Board has established guidelines that require Group management to manage currency risk
associated with the companies’ functional currencies. The currency risk arises when future
transactions or recognized assets or liabilities are denominated in a currency other than the
functional currency of the entity.
Foreign subsidiaries generate revenues predominantly in the local currency, except for the Polish
operations generating revenue in PLN as well as EUR, and the cost base is also in the local
currency. The parent company have receivables and payables outstanding in foreign currencies,
and these are subject to fluctuations in exchange rates. The net exchange rate exposure related
to the foreign currency balances is minimal.
Senior secured bonds of the Group are denominated in NOK and are not exposed to foreign
currency exchange risk.
3.2 Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations
associated with its financial liabilities that are settled by delivering cash or another financial asset.
The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always
have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions,
without incurring unacceptable losses or risking damage to the Group’s reputation.
The Group manages liquidity risk by maintaining adequate cash balances and banking facilities,
facilities granted by the shareholders, continuously monitoring forecast and actual cash flows and
matching the maturity profiles of financial assets and liabilities. Please refer to Note 19 which
specifies maturity of Senior secured bonds as well as Note 2.1 which provides more details about
their refinancing.
Page 45 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
Cash flow forecasts are prepared in the various operational entities in the Group and aggregated
by the Group’s finance manager. The finance manager together with the Group CFO monitor the
rolling forecasts of the Group’s liquidity requirements to ensure that the Group has sufficient cash
equivalents to cover operational obligations, and simultaneously maintain sufficient flexibility
through access to unused drawing rights available in the Group’s multi-currency cash pool facility
at all times, such that the Group will not exceed its drawing rights/limits or covenants related to
the Group’s borrowings. Such forecasts consider the Group’s planned borrowings and compliance
with terms and covenants. Surplus cash in the Group companies, other than what is considered
necessary working capital, is transferred to the Group’s treasury function. The Group’s treasury
function utilizes surplus cash for the repayment of the multi-currency overdraft liability.
The table below details the Group’s contractual financial obligations classified in accordance with
the maturity structure as at 31 December 2022. The amounts in the table are undiscounted
contractual cash flows and contain also future interest payments that are not included in the
statement of financial position as of 31 December 2022.
(in NOK '000s)
Within
2 years
3 years
4 years
More than
Total
1 year
4 years
Lease liabilities
25,746
44,205
41,086
39,403
170,871
321,311
Loan from
shareholder
33,568
33,568
Senior secured
bonds
49,480
525,465
574,945
Borrowings
8,701
8,701
8,701
8,701
34,804
Trade and other
payables
370,065
370,065
487,560
578,371
49,787
48,104
170,871
1,334,693
The table below details the Group’s contractual financial obligations classified in accordance with
the maturity structure as at 31 December 2021. The amounts in the table are undiscounted
contractual cash flows and contain also future interest payments that are not included in the
statement of financial position as of 31 December 2021.
Page 46 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
(in NOK '000s)
Within
2 years
3 years
4 years
More than
Total
1 year
4 years
Lease liabilities
38,454
40,222
39,132
36,961
207,218
361,987
Loan from
shareholder
32,725
32,725
Senior secured
bonds
36,575
36,575
503,346
576,496
Borrowings
403
8,236
8,236
8,236
8,236
33,347
Trade and other
payables
348,290
348,290
456,447
85,033
550,714
45,197
215,454
1,352,845
3.3 Credit risk
Credit risk is the risk that any counterparty will not meet its obligations under a financial instrument
or customer contract, leading to a financial loss. Credit risk is considered on Group level. Credit
risk arises in transactions involving loans receivable, cash and cash equivalents, deposits in
banks and credit institutions in addition to transactions with wholesalers and consumers, including
trade receivables. Routines have been implemented to ascertain that sales are only made to
distributors and importers that have satisfactory creditworthiness. Counterparties to derivative
contracts and financial investments are limited to credit institutions with high credit rating.
If independent credit ratings are available for wholesale customers, these are used in determining
credit limits. If no independent credit rating is available, an assessment is made based on the
customer’s financial position, history and potentially other factors. Individual limits for risk
exposure are set based on internal and external assessments of creditworthiness.
The Group’s routines for use of credit limits, and the compliance with the routines, are reviewed
on a regular basis.
The carrying amount of financial assets represents the maximum credit exposure. The maximum
exposure to credit risk at 31 December is:
(in NOK '000s)
31 December 2022
31 December 2021
Other receivables
10,659
12,547
Trade and other receivables (excluding
prepayments)
190,689
168,812
Cash and cash equivalents
131,096
108,257
Maximum exposure to credit risk
332,444
289,616
There are no significant concentrations of credit risk, whether through exposure to individual
customers and regions.
Page 47 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
Other receivables
Other receivables consist of non-current deposit receivable and loan receivable that are neither
overdue nor impaired. Management considers there is a low risk of non-recoverability due to the
good credit history of the borrower, existence of sufficient funds to settle the outstanding amount,
based on data that is determined to be predictive of the risk of loss and applying experienced
credit judgement.
Trade and other receivables
Exposure to credit risk for trade and other receivables is disclosed in note 16.
The Group uses factoring. Under the factoring arrangements, the Group transfers relevant trade
receivables to a factor including substantially all the risks and rewards attached to those trade
receivables. The transferred trade receivables are fully derecognized when transferred to the
factor. As of 31 December 2022, the Group has factoring facilities of MEUR 16, out of which a
portion of MEUR 6.7 was used, representing 42% of the available facilities.
The factor has a possibility to transfer back the transferred receivables only in these cases:
• the receivable becomes disputed receivable
• the receivable is unpaid and (i) the Group does not file a valid claim under the credit insurance
policy or (ii) any third party takes action with a view to exercising any right or claim in respect
of this receivable.
During 2022, total receivables transferred to factor amount to NOK 1,056,992 thousand (2021:
NOK 786,498 thousand).
Cash and cash equivalents
Credit risk with respect to cash and cash equivalent is limited because the counterparties are
reputable banks with good credit ratings as shown in the following table:
Rating agency: Standard & Poor's
Short term
Long term
Nordea Bank
A-1+
AA-
National Westminster Bank (Natwest)
A-2
BBB
Unicredit Banca
A-2
BBB
Caixa Bank
A-2
A-
Bank Inter
A-2
A-
Bank BNP Paribas
A-1
A+
PKO Bank Polski *
P-1
A2
Banque Rhône-Alpes
A-1
A
Bank of America
A-2
A-
Scotia Bank
A-1
A-
Danske Bank
A-1
A+
* Standard & Poor’s rating not available. Moody’s rating used instead.
Page 48 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
3.4 Capital management risk
The Group’s objectives and guidelines for the management of capital is established through the
Group’s financial policy. The Group’s financial policy is reviewed every year and adopted by the
Board. Management’s objectives when managing the capital of the Group are to safeguard the
Group's ability to continue as a going concern in order to provide returns for the shareholders of
the Group and benefits for other stakeholders and to maintain an optimal capital structure to
reduce the cost of capital for the Group.
The main objectives of the Group’s financial policy is to, at all times, ensure that the Group has
sufficient liquidity to maintain normal operations, carry out capital additions and use of capital in
a manner that reduces risk and costs, and to use all surplus liquidity to repay current bank
borrowings. All decisions related to loan financing in the Group’s subsidiaries are made by Group
management, i.e. no subsidiaries are mandated to enter into borrowing agreements, establish
cash overdraft facilities, provide guarantees or enter into leasing contracts. The Group’s multi-
currency cash pool is a suitable tool for structuring the Group’s bank transactions and to optimize
net finance items, including currency gains and losses. All subsidiaries are included in the multi-
currency cash pool and have no significant bank arrangements in addition to this.
The capital structure of the Group consists of borrowings offset by cash and cash equivalents
balances and equity of the Group.
The Group has covenant requirements related to both the bond agreement and the RCF
agreement. All covenants were met in 2022 and reported in accordance with the relevant
agreements. There are no indications that the covenants will not be met for 2023.
3.5 Operational risk
The Group has operations in Norway, Denmark, Poland, France, England, Spain, Italy and the
USA, consisting of manufacturing and sales in Norway, Poland, France and the USA, and only
sales in the other mentioned countries.
Group management’s assessment is that the operational risk is limited. However, certain raw
materials are critical. The Group has in this area ensured that it has several and alternative
suppliers.
In Norway, the power supply to the foundry is important, and the Group has secured supplies
through a spare high voltage transformer and a separate agreement with power suppliers for
maintenance of the high voltage installation. Casts are a critical factor at the foundry in Norway,
and these are safeguarded in a warehouse that has customary fire protection. The cast designs
are also stored electronically and may be recreated in an automated cutting machine.
The undisturbed continuity of the foundry machinery is critical, and a sufficient inventory of critical
spare parts held both locally and with suppliers secures continuous operations. The Group’s casts
fit standardized foundry machines in Europe so that hire production can be established within a
reasonable time, if need be.
Page 49 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
The production in Poland takes place with machines that are available in the market and which
can be replaced within a reasonable time. Hire production with external suppliers is also possible
for parts for the products, which then can be assembled in the Group’s own factory.
The Group does not own vehicles for transportation of goods; it sources such services. Several
suppliers are used, and the Group does not consider transport availability as a risk in the current
situation. Access to workforce, both trained and untrained is sufficiently available in the countries
in which the Group operates. Technical data, drawings, procedures etc. are stored electronically
with reliable external back-up systems.
The Group has minimal exposure to the Russian, Belarusian or Ukrainian markets, both in terms
of supply base and in terms of sales. No direct sourcing, nor sales to Russia and Belarus are
currently occurring. The Group is currently exporting to Ukraine, however the share of sales to
that market represented only 0.1% of the Group’s revenue in 2022. While some suppliers might
be sourcing raw materials from Russia, Belarus or Ukraine, the Group assesses the risk of
disruption as negligible.
Electricity represents a significant cost for the Group, in particular at the foundry in Kråkerøy. Over
the past years, Norway has experienced very low electricity costs compared to the rest of Europe,
therefore increases observed in the second half of 2021 and throughout 2022 were perceived as
very significant. The Group has increased the selling prices to absorb these extreme electricity
price developments. Similarly, the increase in the cost of natural gas, which is an important cost
element in the Polish factory, has been passed through as increases to selling prices.
4. ACQUISITION OF SUBSIDIARY
There was no acquisitions completed during 2022.
As of 1 June 2021, The Group acquired 100% of the shares in Aico S.p.A. from Stove Investment
Holdings S.à r.l., thereby obtaining control of Aico S.p.A. Aico S.p.A. operates as a sales entity.
According to the share purchase agreement, the price paid for shares was agreed to EUR 1
(equivalent of NOK 10). The purchase accounting did not lead to the recognition of additional
identifiable assets and liabilities. A bargain purchase of NOK 263 thousand has been identified
after a final reassessment leading to an adjustment downwards of the value of the acquired
assets. According to IFRS 3, it has been recognized as a gain in profit or loss. With the acquisition,
Jøtul aims to increase the distribution network and improve the efficiency of the operations in the
Italian and European markets. The transaction-related costs amount to nil.
This transaction represents a business combination under common control for which the Group
applied the acquisition method in accordance with IFRS 3.
Page 50 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
The amounts recognized in respect of the identifiable assets acquired and liabilities assumed are
set out in the table below:
(in NOK '000s)
At cost
Fair value at
date of gain of
control
Property, plant and equipment
8,492
6,572
Intangible assets
9,238
7,852
Inventories
63,502
63,502
Trade and other receivables
106,050
106,050
Other receivables
627
419
Current income tax receivable
322
322
Bank overdrafts
(3,620)
(3,620)
Long-term provisions
(16,472)
(16,472)
Trade and other payables
(164,362)
(164,362)
Net assets acquired
3,777
263
Total consideration transferred for shares
-
Net cash outflow arising on acquisition
-
Consideration for acquisition of shares
-
Net cash paid on acquisition
-
In 2021 Aico S.p.A contributed NOK 88,567 thousand of revenue and NOK 30,138 thousand to
the Group’s net loss for the period between the date of acquisition and the reporting date.
If the acquisition of Aico S.p.A. had been completed on the first day of the financial year 2021,
the Group revenue for that year would have been NOK 1,264,102 thousand and Group loss before
taxes would have been NOK 54,441 thousand.
For the major acquired receivables:
● The fair value of the receivables amount to NOK 40,363 thousand;
● The gross contractual amounts receivable amount to NOK 51,787 thousand;
● The best estimate at the acquisition date of the contractual cash flows not expected to be
collected amount to NOK 10,511.
5. REVENUE
The Group derives revenue from contracts with customers for the sale of wood-burning stoves,
wood-burning fireplaces, gas-burning stoves, gas-burning fireplaces, pellet-burning stoves and
auxiliary equipment for these. The Group sells its products in approximately 45 countries. The
Page 51 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
revenue streams consist solely of the sale of goods to various customers in a range of markets
that are recognized at a point in time.
The increase in revenue in 2022 compared to 2021 is mainly driven by continued high home
improvement spending, further enhanced by the significant increase in electricity and gas prices
across all markets, which confirms wood burning as an important heating alternative and
contributes to sustained strong revenues. Furthermore, certain markets, such as Germany, have
seen strong demand following requirements to phase out older stoves to comply with new
standards concerning efficiency and emissions.
Please refer to note 26 for the presentation of revenues by segment.
6. OTHER OPERATING INCOME
(in NOK '000s)
2022
2021
Gain on disposal of property, plant and
equipment
-
533
Other operating income
10,720
3,439
Total other operating income
10,720
3,972
Other operating income contains mainly the effect of the write-off of old liabilities related to goods
received not invoiced, in addition to R&D and electricity refunds and other smaller elements.
7. EMPLOYEE BENEFITS EXPENSE
(in NOK '000s)
2022
2021
Salaries and wages
(273,408)
(229,167)
Social security contribution
(53,941)
(51,366)
Pension fund contribution
(16,699)
(6,787)
Other employee benefits
(17,879)
(20,509)
Total employee benefits expense
(361,927)
(307,829)
In Norway, the Group is required by law (Act relating to mandatory service pensions) to have a
pension plan. Jøtul AS meets the requirements of the law.
Page 52 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
Included in employment benefits expense is remuneration of key management personnel as listed
below for the year ended 31 December 2022:
(in NOK
'000s)
Salary
(1)
Variable
pay (2)
Additional
remuneration
(3)
Total
Net
pension
expenses
Nils Agnar
Brunborg
CEO
01.01-31.12
3,458
413
204
4,075
321
Adrian
Postolache
CFO
01.01-31.12
1,475
160
120
1,755
-
Total
4,933
573
324
5,830
321
(1) Incl. holiday allowance
(2) Bonus
(3) Other fixed pay such as fixed car allowance
The CEO has a notice period of six months in addition to rights to compensation for six months
and a bonus agreement which is limited to a maximum of 50% of the base salary. The CFO has
a notice period of three months and also has a bonus agreement which is limited to a maximum
of 40% of the base salary.
No loans or credits have been given to leading employees or key management personnel.
Included in employment benefits expense is remuneration of key management personnel as listed
below for the year ended 31 December 2021:
(in NOK
'000s)
Salary
(1)
Variable
pay (2)
Additional
remuneration
(3)
Total
Net
pension
expenses
Nils Agnar
Brunborg
CEO
01.01-31.12
3,487
990
204
4,681
321
Adrian
Postolache
CFO
01.05-31.12
952
-
80
1,032
-
Jonas
Bloom
CFO
01.01-30.04
432
-
40
472
-
Total
4,871
990
324
6,185
321
(1) Incl. holiday allowance
(2) Bonus
(3) Other fixed pay such as fixed car allowance
The fees paid to Board members amount to nil in 2022 (2021: nil).
The average number of employees (full-time equivalent) for undertakings held by the Group is
763 (2021: 758). This includes temporary/seasonal employees.
Page 53 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
8. OTHER OPERATING EXPENSE
(in NOK '000s)
2022
2021
Shipping and distribution cost
(67,281)
(65,819)
Rental of buildings and machinery
(10,438)
(4,526)
Selling and marketing costs
(57,907)
(57,975)
Production and maintenance costs
(43,647)
(33,749)
Cost relating to relocation of manufacturing
-
(18,208)
Management fees
(6,098)
(6,000)
Insurance
(17,461)
(17,468)
Audit fees
(2,469)
(1,986)
Tax advisory and other non-audit fees
(58)
(44)
Other consultancy fees
(31,246)
(22,127)
Other administration and operating expenses
(92,186)
(69,167)
Total other operating expense
(328,791)
(297,069)
Included in other operating expense is NOK 2,469 thousand (2021: NOK 1,986 thousand) for
audit fees and NOK nil (2021: NOK nil) for non-audit fees. During 2022, NOK 58 thousand (2021:
NOK 44 thousand) was charged for tax advisory fees.
9. FINANCE INCOME
(in NOK '000s)
2022
2021
Interest income
797
80
Fair value adjustment on derivatives
-
48
Net foreign currency gain
4,338
8,284
Bank interest and other interest income
17
1
Total finance income
5,152
8,413
10. FINANCE EXPENSE
(in NOK '000s)
2022
2021
IFRS 16 interest
(14,105)
(15,111)
Interest on borrowings
(11,088)
(14,063)
Interest on shareholder loan
(230)
(25,938)
Interest on bond
(43,065)
(8,713)
Amortized costs on Bond
(4,196)
(1,264)
Compensation of interest on borrowing by
government grant
1,459
1,446
Other finance expense
(10,031)
(8,722)
Total finance expense
(81,256)
(72,365)
Page 54 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
In 2022, Interest on bond relates to the interest on the bonds issued in October 2021 by the legal
entity Jøtul AS. Before that date, the prior bonds were structured at Jotul Holdings level and the
financing was provided to Jøtul AS via intercompany loan. This explains the significant variances
year on year in both Interest on bond and Interest on shareholder loan. Other finance expenses
consist of banking fees and other finance costs.
11. INCOME TAX
The components of income tax are as follows:
(in NOK '000s)
2022
2021
Current income tax (expense)/benefit in
respect of the current year
(10,146)
(6,252)
Deferred tax (expense)/benefit
87,063
689
Total income tax expense
76,917
(5,563)
In 2022, the Group recognized a deferred tax asset of MNOK 84.2 coming from the cumulated
losses carried forward by Jøtul AS over the previous periods. The recognition was possible and
justified by the fact that the Norwegian division has turned to profitability in the past couple of
years, and it is foreseen that the tax losses will be utilized in the next few years.
The income tax expense for the year can be reconciled to the accounting profit as follows:
(in NOK '000s)
2022
2021
Loss before tax
99,124
(29,191)
Applicable tax rate
22.00%
22.00%
Calculated income tax benefit/(expense)
(21,807)
6,422
Foreign tax rate different from 22 %
254
(2,255)
Tax effect on non-taxable income
212
(36)
Tax attributable to prior years
210
73
Tax effect on non-deductible expenses
3,346
(302)
Deferred tax assets not recognized
8,655
(9,813)
Deferred tax assets recognized on cumulated losses
84,179
-
Other
1,868
348
Income tax expense
76,917
(5,563)
Page 55 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
Deferred tax is presented net when the Group has a legal right to offset deferred tax assets
against deferred tax liabilities in the statement of financial position and if the deferred tax relates
to the same tax authority.
The origin of deferred tax assets and liabilities is as follows as of 31 December 2022:
(in NOK '000s)
Assets
Liabilities
Net
Tangible and intangible fixed assets
380
(2,279)
(1,899)
Inventory, trade and other receivables, trade
and other payables
3,560
(175)
3,385
Tax losses carried forward
84,179
-
84,179
Other items
-
(4)
(4)
Deferred tax assets/(liabilities)
88,119
(2,458)
85,661
Reflected in the consolidated statement of financial position as follows:
Deferred tax asset
85,847
Deferred tax liability
(186)
The origin of deferred tax assets and liabilities is as follows as of 31 December 2021:
(in NOK '000s)
Assets
Liabilities
Net
Tangible and intangible fixed assets
660
(4,065)
(3,405)
Inventory, trade and other receivables,
trade and other payables
2,721
-
2,721
Tax losses carried forward
-
-
-
Other items
-
(14)
(14)
Deferred tax assets/(liabilities)
3,381
(4,079)
(698)
Reflected in the consolidated statement of financial position as follows:
Deferred tax asset
1,269
Deferred tax liability
(1,967)
Deferred tax assets not recognized by the Group are NOK 108,310 thousand and NOK 211,369
thousand as of 31 December 2022 and 31 December 2021, respectively. Unrecognized tax losses
relate to Norway, Denmark, Poland and Italy. There is no expiry date in Norway, Denmark and
Italy. In Poland, tax losses can be used within 5 years but for an amount which cannot be higher
than 50 percent each loss per year.
Page 56 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
12. PROPERTY, PLANT AND EQUIPMENT
(in NOK '000s)
Land and
buildings
Machinery
Fixtures
Total
Cost
Balance at 1 January 2021
3,733
98,942
38,720
141,395
Additions
82
6,467
2,286
8,835
Disposals
-
(206)
(1,135)
(1,341)
Subsidiaries acquired
-
6,739
732
7,471
Write down
-
-
-
-
Transfers
336
7,730
(18,327)
(10,261)
Effect of foreign currency exchange
differences
224
(6,531)
(1,979)
(8,286)
Balance at 31 December 2021
4,375
113,141
20,297
137,813
Additions
163
12,449
1,117
13,729
Disposals
-
(18,498)
(14,067)
(32,565)
Write down
-
-
-
-
Transfers
218
1,797
(66)
1,949
Effect of foreign currency exchange
differences
832
10,106
3,020
13,958
Balance at 31 December 2022
5,588
118,995
10,301
134,884
Accumulated depreciation
Balance at 1 January 2021
(1,197)
(6,743)
(6,163)
(14,103)
Depreciation expense
(444)
(13,926)
(6,341)
(20,711)
Disposals
-
205
1,135
1,340
Write down
-
-
-
-
Transfers
138
661
9,621
10,420
Effect of foreign currency exchange
differences
(181)
2,727
738
3,284
Balance at 31 December 2021
(1,684)
(17,076)
(1,010)
(19,770)
Depreciation expense
(434)
(14,642)
(2,453)
(17,529)
Disposals
-
18,409
7,242
25,651
Write down
-
-
-
-
Transfers
(137)
(1,625)
(3,214)
(4,976)
Effect of foreign currency exchange
differences
(681)
(7,106)
(2,733)
(10,520)
Balance at 31 December 2022
(2,936)
(22,040)
(2,168)
(27,144)
Carrying value as at 31 December 2022
2,652
96,955
8,133
107,740
Carrying value as at 31 December 2021
2,691
96,065
19,287
118,043
Page 57 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
13. INTANGIBLE ASSETS
(in NOK '000s)
Trademarks
Customer
relationships
Other
intangible
assets
Total
Cost
Balance at 1 January 2021
190,000
1,885
74,887
266,772
Additions
-
-
26,501
26,501
Subsidiaries acquired
-
-
6,175
6,175
Disposals
-
-
(5,841)
(5,841)
Reclassification
-
-
(933)
(933)
Effect of foreign currency
exchange differences
-
(93)
(2,103)
(2,196)
Balance at 31 December 2021
190,000
1,792
98,686
290,478
Additions
-
-
32,142
32,142
Disposals
-
-
(12,658)
(12,658)
Reclassification
-
-
(4,535)
(4,535)
Effect of foreign currency
exchange differences
-
101
2,172
2,273
Balance at 31 December 2022
190,000
1,893
115,807
307,700
Accumulated amortization
Balance at 1 January 2021
(144,000)
(355)
(22,422)
(166,777)
Amortization expense
-
(228)
(15,669)
(15,897)
Disposals
-
-
4,400
4,400
Reclassification
-
-
(310)
(310)
Effect of foreign currency
exchange differences
-
22
1,961
1,983
Balance at 31 December 2021
(144,000)
(561)
(32,040)
(176,601)
Amortization expense
-
(227)
(20,282)
(20,509)
Disposals
-
-
12,420
12,420
Reclassification
-
-
1,832
1,832
Effect of foreign currency
exchange differences
-
(41)
4,592
4,551
Balance at 31 December 2022
(144,000)
(829)
(33,478)
(178,307)
Carrying value as at 31
December 2022
46,000
1,064
82,329
129,393
Carrying value as at 31
December 2021
46,000
1,231
66,646
113,877
Trademarks with indefinite useful lives at 31 December 2022 amounting to NOK 46,000 thousand
are not amortized (2021: NOK 46,000 thousand). The Group tests whether trademarks have
suffered any impairment on an annual basis. For the 2022 and 2021 reporting periods, the
Page 58 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
recoverable amount of the trademarks was determined using the value in use approach. The
calculations use revenue projections where 2023 revenue is based on budgeted figures, adjusted
downwards with a risk factor of 5%, and revenues of the following years are assumed at a rather
prudent constant level every year (i.e., zero growth rate). The discount rate assumption used was
13.5%.
The below table shows effect of reasonably possible changes in assumption on recoverable
amount.
(in NOK '000s)
Recoverable
amount
Change
Current assumptions
109,106
0
Decrease in discount rate by 2%
128,081
18,975
Increase in discount rate by 2%
95,027
(14,078)
Decrease in 2023 budgeted revenues by 10%
97,106
(11,485)
Increase in 2023 budgeted revenues by 10%
120,590
11,485
Decrease in perpetual revenue growth rate by 2%
95,027
(14,078)
Increase in perpetual revenue growth rate by 2%
128,081
18,975
The carrying value of trademarks held by the Group as of 31 December 2022 refers entirely to
the Jøtul brand.
As Jøtul has a history of 170 years and the management has no plans to abandon the trademarks
in the near future, the useful lives for the trademarks are assumed to be indefinite.
The Group’s total research and development costs capitalized during the year amounts to NOK
23,311 thousand. The main component of the Other intangible assts category is represented by
capitalized product development costs. This includes wages and salaries, bought-in services,
materials and a share of the Group’s fixed overhead costs. The expected total earnings from
development projects in progress correspond to the total costs incurred. Development of
intangible assets includes internal projects managed by internal resources.
Page 59 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
14. OTHER RECEIVABLES
(in NOK '000s)
31 December 2022
31 December 2021
Loan receivable
8,550
10,800
Deposits for property leases
1,906
1,291
Other
203
456
Total other receivables
10,659
12,547
Current
2,934
2,962
Non-current
7,725
9,585
Total other receivables
10,659
12,547
Loan receivables consist of an interest bearing loan between Jotul AS and Festningsveien 2 AS
for a nominal amount of NOK 13,500,000. Festningsveien 2 AS is a lessor of the Group. The loan
is unsecured and was provided on 1 July 2017 to provide Festningsveien 2 AS with funding to
build a new warehouse and manufacturing facility for the Group’s plant in Kråkerøy. The loan
bears interest rate at an average of 3 months NIBOR (Norwegian Inter Bank Offered Rate) plus
a margin of 2%, payable quarterly in arrears. The loan is repayable in installments of NOK 225,000
per quarter starting from 1 July 2017 and expected to be fully repaid on 1 July 2032.
As at 31 December 2022, the principal outstanding is NOK 8,550 thousand (2021: NOK 10,800
thousand) and accrued interest is NOK nil (2021: NOK Nil). Interest income on the loan amounts
to NOK 797 thousand (2021: NOK 80 thousand) and is included in finance income (see Note 9).
The Group has an enforceable right to offset the loan with lease payables due to Festningsveien
2 AS.
15. INVENTORIES
(in NOK '000)
31 December 2022
31 December 2021
Raw materials
128,574
143,810
Work in progress
36,038
39,328
Finished goods
180,138
113,717
Spare parts and other inventories
95,625
55,712
Total inventories
440,375
352,567
The carrying amount of inventories recorded at the net realizable value is NOK 23,145 thousand
(2021: NOK 4,652 thousand). The Group’s policy is to hold spare parts for all products that have
Page 60 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
been manufactured in the last 10 years in inventory, therefore certain articles become aged. The
Group’s criteria for calculating obsolescence, for all categories of inventory, is the following:
Category 1 No sale/usage last 36 months, allowance of 100% of manufacturing cost
Category 2 No sale/usage last 24 months, allowance of 50% of manufacturing cost
Category 3 Sale/usage last 12 months and inventory representing more than one year of
usage is reduced by an allowance of 25% of manufacturing cost.
Total inventory write-off amounts to NOK 11,684 thousand (2021: NOK 11,366 thousand). The
write-off of inventories is included in operating expenses and is mainly due to scrapping of
obsolete and damaged parts.
16. TRADE AND OTHER RECEIVABLES
(in NOK '000s)
31 December 2022
31 December 2021
Trade receivables
180,409
141,885
Allowance for doubtful debts
(5,805)
(4,306)
174,604
137,579
Prepayments
10,033
34,484
VAT receivables
16,085
31,231
Total trade and other receivables
200,722
203,294
The Group’s credit terms vary from market to market. For the Nordic market, credit terms are
normally 30 days, whilst terms in Latin Europe are normally 45-90 days. For customers in the
USA and Italy participating in “early purchase” campaigns, credit terms may be significantly
longer. Impairment loss recognized on trade receivables is NOK nil (2021 NOK 8,282 thousand).
The Group considers a financial asset to be in default when internal or external information
indicates that the Group is unlikely to receive the outstanding contractual amounts in full before
taking into account any credit enhancements held by the Group. When a receivable amount is
considered lost, the balance written off is also recognized as a reduction to the allowance account.
Any subsequent receipts related to balances previously written off are recognized as reversal of
impairment losses on financial assets in the profit and loss.
The VAT receivable of NOK 16,085 thousand (2021: NOK 31,231 thousand) represents mainly
the excess of VAT deductible versus the VAT collected. The Polish manufacturing division in
particular incurs more purchases that carry VAT (i.e., domestic), while the largest portion of the
sales are exports and thus exempt from VAT. This generates an ongoing claim/reimbursement
process.
Page 61 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
The aging of the trade receivables is as follows:
(in NOK '000s)
Gross amount
Allowance
Carrying value
Not due
144,572
-
144,572
0-60 days overdue
23,734
(1,357)
22,377
61-180 days overdue
3,594
(366)
3,228
181-365 days overdue
742
(230)
512
More than 1 year overdue
7,767
(3,852)
3,915
Total
180,409
(5,805)
174,604
The aging of the trade receivable is as follows as of 31 December 2021:
(in NOK '000s)
Gross amount
Allowance
Carrying value
Not due
109,425
-
109,425
0-60 days overdue
20,815
(907)
19,908
61-180 days overdue
2,830
(466)
2,364
181-365 days overdue
2,293
(421)
1,872
More than 1 year overdue
6,522
(2,512)
4,010
Total
141,885
(4,306)
137,579
The development in more than one year overdue is due to Aico Italy acquired in June 2021 (Gross
amount: NOK 5,541, Allowance: NOK (1,998)).
17. CASH AND CASH EQUIVALENTS
For the purpose of the cash flow statement, cash and cash equivalents comprise of cash at bank
and cash in hand amounting to NOK 131,095 thousand (2021: NOK 108,257 thousand) of which
NOK 4,729 thousand (2021: NOK 4,348) is restricted as it relates to tax withheld from employees
according to Norwegian law.
Certain companies within the Group, including Jotul AS, Jotul Poland, Scan AS, Jotul France,
Jotul North America Inc. and AICO S.p.A have entered into a working capital facility agreement
as borrowers, with Nordea Bank AB (publ), filial I Norge as lender, dated 28 February 2018 (“the
revolving credit facility”).
The commitment under the revolving credit facility amounts to NOK 75 million (including ancillary
facility). The revolving credit facility has been provided for general corporate purposes (and any
refinancing, amendments or replacements thereof). The revolving credit facility was renewed in
October 2021 with validity until 1 June 2024.
Page 62 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
As at the statement of financial position date, the Group has a liquidity reserve of NOK 52.0 million
in unused bank overdraft facilities (excluding ancillary facility). Facility used as at year end was
zero (2021: NOK 17.2 million).
18. EQUITY
As of 31 December 2022, capital contributed from the sole shareholder in a form of equity
consisted of share capital of NOK 139,414 thousand (31 December 2021: NOK 139,414
thousand) and share premium of NOK 1,026,612 thousand (31 December 2021: 1,026,612).
As at 31 December 2022, the authorized and issued share capital consist of 1 share fully paid at
a par value of NOK 139,414 thousand.
19. SENIOR SECURED BONDS
On October 2021, Jøtul AS issued senior secured floating rate bonds up to NOK 750 million. The
bonds bear an interest rate of 6.95% + 3-month NIBOR and have a maturity of three years. The
initial aggregate principal amount is NOK 475 million with a possibility to issue subsequent bonds
in an aggregate amount of NOK 275 million. The new bonds are accounted for at amortized cost.
The transaction led to a payment of banker’s fees for an amount of NOK 11.9 million.
Proceeds from the bonds were used as follows:
● Jotul AS used part of the funds received to repay the bonds issued by Jotul Holdings
S.à r.l. for an amount of NOK 300 million.
● In exchange of this repayment, Jotul Holdings S.à.r.l. offset the loan receivable towards
Jotul AS amounting to NOK 380 million including interest. NOK 81 million have been
converted from the bonds in Jotul Holdings S.à.r.l. to the bonds in Jotul AS (please refer
to note 24).
● The difference between the amortized cost of the loan offset and the value of the bonds
redeemed amounting to NOK 22 million led to a net balance for the loan position with Jotul
Holdings of NOK 31 million (please refer to the note 21).
The movement during the year is as follows:
(in NOK '000s)
Opening balance at 1 January 2022
470,574
PIK bonds issued during the year
-
Interest accrued on bonds during the year
43,065
Interest paid during the year
(40,151)
Remeasurement at amortized cost
(4,196)
Closing balance at 31 December 2022
477,684
Page 63 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
Current
11,627
Non-current
466,057
Total
477,684
Covenants
The following key covenants apply:
● Maintenance test performed semi-annually, on 31 December and on 30 June. Net interest-
bearing debt to EBITDA ratio must be ≤ 5.50x with annual step-down of 0.50x. For 2022
the ratio should therefore be ≤ 5.00x.
● Incurrence test performed when and if applicable. Net interest-bearing debt to EBITDA
should be ≤ 4.00x with annual step-down of 0.25x. For 2022 the ratio should therefore be
≤ 3.75x.
● Distribution test, as applicable. Net interest-bearing debt to EBITDA should be ≤ 3.00x.
Restrictions on distribution were implemented to permit only the distribution of the
shareholder loan, subject to meeting the distribution covenant, and the annual monitoring
fees.
20. BORROWINGS AND GOVERNMENT GRANT
In April 2020, Jotul France and Aico France withdrew new borrowings with state guarantee
provided by Banque Rhône-Alpes. Loans with state guarantee were implemented by French
government to support businesses during the COVID-19 pandemic. The loans bear an interest of
0.5% p.a. and are repayable after 12 months with a delay option of up to 5 years. The Group
plans to repay the loan in installments up to 2026, the first installment being in April 2023.
The loan was provided at a reduced interest rate. The difference between the market rate of
interest for an equivalent loan at the inception date and the rate provided at favorable conditions
has been recognized as a government grant in accordance with IAS 20. At the inception date, the
grant was valued at NOK 7,021 thousand and it is being amortized on the same basis as the
interest expense. As of 31 December 2022, the carrying amount of the government grant is NOK
3,393 thousand (2021: NOK 3,989 thousand) of which NOK 1,583 thousand (2021: NOK 1,441
thousand) shall be amortized within next 12 months.
The borrowing is measured at amortized cost with carrying amount of NOK 29,847 thousand as
of 31 December 2022 (2021: NOK 27,476 thousand). The effective interest rate was estimated at
6.67%.
There are no underlying conditions that the Group has to fulfill in connection with the borrowings.
There is no pledge or security provided by the Group.
Page 64 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
21. LOAN
The loan agreement was entered into on 27 April 2018 in connection with the debt transfer
agreement dated 28 February 2018 entered into between Jotul Holdings Sarl and Jotul AS. The
loan initial amount was NOK 612 million. The discounted values at which the debt was acquired
amounted to NOK 333 million. The loan normally bears an interest rate of NIBOR plus a spread
in accordance with the arm’s length principle. However, the rate was not defined in the agreement
and a fixed rate of 9% has been used.
As at 31 December 2021, the loan has been redeemed (please refer to note 19). During the year,
Jotul Holdings Sarl also granted a loan of Euro 2.5 million to Jotul AS that has been repaid at the
same time. Another loan of Euro 5 million was granted. As at 31 December 2021, this loan
amounted to a net balance of NOK 30 million due to the excess on the Bond redemption of NOK
22 million (please refer to note 19) in the accounts of Jotul AS.
As at 31 December 2022, the remaining balance of shareholder loans is as follows:
(in NOK '000s)
31 December
2022
31 December
2021
Principal amount
26,119
26,119
Accrued interest
4,662
4,432
Effect of foreign currency exchange differences
2,787
-
Closing balance
33,568
30,551
Current
33,568
30,551
Non-current
-
-
Total
33,568
30,551
22. TRADE AND OTHER PAYABLES
(in NOK '000s)
31 December
2022
31 December
2021
Trade payables
246,397
221,632
Employee related payables
32,278
30,614
Social security, VAT payable
39,930
46,868
Accrued expenses
49,956
35,668
Other payables
1,504
13,508
Total trade and other payables
370,065
348,290
Page 65 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
23. PROVISIONS
(in NOK '000s)
31 December
2022
31 December
2021
Provision relating to relocation of manufacturing
-
2,713
Provision for defined benefit pension plans
5,255
8,504
Warranty provision
2,809
1,926
Other provisions
2,851
1,406
Total provisions
10,915
14,549
Short-term provisions
2,176
4,154
Long-term provisions
8,739
10,395
Total provisions
10,915
14,549
The movement during the year is as follows:
in NOK '000s)
31 December
2021
Additions
Provision
used during
the year
Others
Conversion
difference
31 December
2022
Provision for relocation
of manufacturing
2,714
-
(2,747)
-
33
-
Provision for defined
benefit pension plans
8,504
1,575
(3,184)
(1,954)
314
5,255
Warranty provision
1,925
565
-
253
65
2,808
Other provisions
1,406
595
(398)
1,093
156
2,852
Total
14,549
2,735
(6,330)
(608)
567
10,915
The Group operates or participates in a number of defined benefit and defined contribution plans
throughout Europe. The main defined benefit pension plans relate to accruals of pension bonus
payable to employees upon retirement in France and in Italy following the acquisition of Aico Italy
(see note 7).
These plans have been set up and operated in accordance with national laws and regulations.
Page 66 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
24. RECONCILIATION OF LIABILITIES ARISING FROM FINANCING ACTIVITIES
(in NOK '000s)
Senior
secured
bonds
Loan from
shareholder
Borrowings
Bank
borrowing
Leases
Balance at 1 January 2021
-
353,084
27,644
18,640
364,726
Cash flows
382,299
(268,131)
-
(1,442)
(36,982)
Unpaid accrued interest
8,553
26,583
-
-
-
Bond conversion
80,986
(80,986)
-
-
-
Remeasurement at
amortized cost
(1,264)
-
1,081
-
-
New leases/effect of variable
leases
-
-
-
-
16,003
Adjustments
-
-
-
-
(2,679)
Currency translation
adjustment
-
1
(1,249)
-
(7,259)
Balance at 31 December
2021
470,574
30,551
27,476
17,198
333,809
Current
8,713
30,551
-
17,198
48,721
Non-current
461,861
-
27,476
-
285,088
Total
470,574
30,551
27,476
17,198
333,809
(in NOK '000s)
Senior
secured
bonds
Loan from
shareholder
Borrowings
Bank
borrowing
Leases
Balance at 1 January 2022
470,574
30,551
27,476
17,198
333,809
Cash flows
-
-
-
(17,198)
(33,855)
Unpaid accrued interest
11,626
230
-
-
Remeasurement at
amortized cost
(4,517)
-
281
-
-
New leases
-
-
-
-
11,206
Effect of variable leases
9,279
Currency translation
adjustment
-
2,787
2,090
-
872
Balance at 31 December
2022
477,683
33,568
29,847
-
321,311
Current
11,626
33,568
-
-
53,994
Non-current
466,057
-
29,847
-
267,317
Total
477,683
33,568
29,847
-
321,311
Page 67 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
25. LEASES
(in NOK '000s)
31 December
2022
31 December
2021
Right-of-use assets
Land and buildings
202,436
226,659
Plant and machinery
21,646
11,939
Furniture and fittings
926
1,135
Total right-of-use assets
225,008
239,733
Lease liabilities
Current
53,994
48,721
Non-current
267,317
285,088
Total lease liabilities
321,311
333,809
Additions to the right-of-use assets for the year ended 31 December 2022 amounted to NOK
10,842 thousand (2021: NOK 19,952 thousand). The majority of the additions in 2022 are driven
by the renewal of the leased vehicles fleet and forklifts.
The maturity analysis of lease liabilities is presented in note 3.2.
In order to mitigate negative impacts of the COVID-19 pandemic, the Group was granted with rent
deferral for some of its house lease contracts for an amount of NOK 11,386 thousand which was
full settled in 2021 in accordance with the term of the agreement.
(in NOK '000s)
31 December
2022
31 December
2021
Depreciation charge of right-of-use assets
Land and buildings
(30,054)
(38,029)
Plant and machinery
(6,573)
(8,551)
Furniture and fittings
(442)
(719)
Total depreciation charge of right-of-use assets
(37,069)
(47,299)
Average remaining duration of lease contracts as of 31 December 2022:
Land and buildings
8 years
Plant and machinery
2 years
Furniture and fittings
2.5 years
Total interest expense relating to leases amounts to NOK 13,792 thousand (2021: NOK 15,111
thousand) and is presented in Finance expense. Please refer to Note 10.
Total cash outflow relating to leasing during 2022 amounted to NOK 38,855 thousand (2021: NOK
36,982 thousand).
Page 68 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
26. SEGMENT REPORTING
Norway, Poland, France and North America are deemed to be the most important geographical
markets for the Group. Segmental reporting is based on the Group’s divisional geographical
operations and mirrors internal reporting organization. Corporate assets, liabilities and expenses
relate to corporate headquarters and include management of financial resources, investing and
other activities not assignable to separately listed divisions.
The Group’s reportable segments are as follows for the year ended 31 December 2022:
(in NOK '000s)
Norway
Poland
France
Italy
North
America
Other
Eliminations
Total
External sales
631,481
73,019
405,350
229,908
274,684
29
-
1,614,471
Intersegment sales
458,417
665,609
1,157
229,975
196
-
(1,355,354)
-
Total revenue
1,089,898
738,628
406,507
459,883
274,880
29
(1,355,354)
1,614,471
Segment results
156,177
31,753
12,527
(43,082)
14,459
3,394
-
175,228
Unallocated
corporate expenses
included:
Operating result
175,228
Finance income
5,152
Finance expense
(81,256)
Loss before income
tax
99,124
Income tax
76,917
Net loss for the year
176,041
(in NOK '000s)
Norway
Poland
France
Italy
North
America
Other
Total
Other information:
Additions to non-current assets*
30,814
2,129
1,032
6,255
5,618
23
45,871
Depreciation and amortization expense
(36,457)
(15,865)
(5,263)
(9,457)
(6,911)
(1,495)
(75,448)
*other than financial assets and deferred tax
Page 69 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
Segment assets
Segment assets are measured in the same way as in the financial statements.
(in NOK '000s)
31 December
2022
Norway
431,155
Poland
336,669
Italy
242,605
North America
125,770
France
102,832
Other
6,365
Total segment assets
1,245,397
Unallocated:
Corporate assets
Deferred tax assets
85,847
Total assets as of 31/12/2022
1,331,244
Segment liabilities
Segment liabilities are measured in the same way as in the financial statements.
(in NOK '000s)
31 December
2022
Norway
782,894
Italy
146,668
Poland
148,156
North America
60,946
France
104,506
Other
8,560
Total segment liabilities
1,251,730
Unallocated:
Corporate liabilities
-
Deferred tax liabilities
(186)
Total liabilities as of 31/12/2022
1,251,544
Page 70 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
The Group’s reportable segments are as follows for the year ended 31 December 2021:
(in NOK '000s)
Norway
Poland
France
Italy
North
America
Other
Elim.
Total
External sales
526,354
86,798
333,350
86,837
200,755
34,906
-
1,269,000
Intersegment sales
260,153
388,239
428
142,914
68
-
(791,802)
-
Total revenue
786,507
475,037
333,778
229,751
200,823
34,906
(791,802)
1,269,000
Segment results
44,762
(52,094)
6,972
(27,635)
14,094
48,663
-
34,762
Operating result
34,762
Finance income
8,412
Finance expense
(72,365)
Loss before income tax
(29,191)
Income tax
(5,563)
Net loss for the year
(34,754)
(in NOK '000s)
Norway
Poland
France
Italy
North
America
Other
Total
Other information:
Additions to non-current assets*
16,809
19,173
1,409
-
2,752
139
40,282
Depreciation and amortization expense
(47,534)
(16,657)
(5,301)
(5,885)
(9,174)
(2,134)
(86,685)
*other than financial assets and deferred tax
Segment assets
Segment assets are measured in the same way as in the financial statements.
(in NOK '000s)
31 December 2021
Norway
373,622
Poland
329,134
North America
132,604
France
117,359
Other
200,032
Total segment assets
1,152,751
Unallocated:
Deferred tax assets
1,269
Total assets as of 31/12/2021
1,154,020
Page 71 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
Segment liabilities
Segment liabilities are measured in the same way as in the financial statements.
(in NOK '000s)
31 December 2021
Norway
791,255
Poland
130,399
North America
68,433
France
87,708
Other
173,762
Total segment liabilities
1,251,557
Unallocated:
Deferred tax liabilities
1,967
Total liabilities as of 31/12/2021
1,253,524
Geographical information
The Group’s revenue from external customers by the country of destination and information about
its segment assets (non-current assets excluding financial instruments, deferred tax assets and
other financial assets) by geographical location are detailed below as at 31 December 2022:
(in NOK '000s)
Revenue
Property, plant
and equipment
Intangible
assets
Right-of-use
assets
France
373,750
1,317
2,432
16,989
Norway
320,283
33,612
109,089
127,682
United States
243,079
10,598
5,967
13,598
Italy
172,659
6,472
10,814
9,756
Germany
106,410
-
-
-
Sweden
63,668
-
-
-
Czech Republic
52,147
-
-
-
Canada
44,200
-
-
-
Poland
38,016
54,900
1,075
54,469
Great Britain (UK)
35,314
104
-
439
Spain
29,136
37
16
1,201
Other countries
135,809
700
-
874
Total
1,614,471
107,740
129,393
225,008
The Group’s revenue from external customers by the country of destination and information about
its segment assets (non-current assets excluding financial instruments, deferred tax assets and
other financial assets) by geographical location are detailed below as at 31 December 2021:
Page 72 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
(in NOK '000s)
Revenue
Property, plant
and equipment
Intangible
assets
Right-of-use
assets
France
309,486
1,134
2,749
19,078
Norway
307,014
44,188
87,976
100,448
United States
172,625
3,679
9,200
48,319
Italy
154,214
5,843
9,828
8,753
Germany
51,180
-
-
-
Sweden
41,697
-
-
-
Canada
33,285
-
-
-
Great Britain (UK)
30,658
84
-
681
Czech Republic
26,545
-
-
-
Spain
22,492
29
20
1,360
Other countries
119,804
63,086
4,104
61,094
Total
1,269,000
118,043
113,877
239,733
Nordic countries include Norway, Denmark, Finland and Sweden.
Latin Europe countries include Spain, France, Italy, Portugal and Luxembourg.
Central Europe countries include Austria, Belgium, Switzerland, Germany and the Netherlands.
Eastern Europe countries include Poland, Ukraine, Lithuania and Belarus.
Major customers
The Group does not have any single customer whose revenue streams exceed 10% of the
Group’s revenue in 2022 and 2021.
27. RELATED PARTY BALANCES AND TRANSACTIONS
The Group is ultimately held by (i) OpenGate Capital Partners I, LP, an exempted limited
partnership registered in the Cayman Islands, (ii) OpenGate Capital Partners I-A, LP I, an
exempted limited partnership registered in the Cayman Islands, and (iii) OGCP I Employee Co-
Invest, LP, an exempted limited partnership registered in the Cayman Islands (collectively, the
“Funds”). OpenGate Capital Management, LLC, a limited liability company formed under the laws
of the State of Delaware, is an investment adviser to private equity funds, including but not limited
to the Funds, which is registered with the United States Securities and Exchange Commission
and is based in Los Angeles, California and Paris, France.
Compensation to key management personnel is included in Note 7.
Page 73 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
(in NOK '000s)
Purchases for
the period from
1 January to 31
December 2022
Sales for the
period from 1
January to 31
December
2022
Balance
payable
outstanding as
at 31 December
2022
Balance
receivable
outstanding as
at 31
December
2022
OpenGate Capital
Management, LLC
(6,000)
-
-
-
Jotul Holdings SA
(2,830)
-
(33,568)
-
(in NOK '000s)
Purchases for
the period from
1 January to 31
December 2021
Sales for the
period from 1
January to 31
December
2021
Balance
payable
outstanding as
at 31 December
2021
Balance
receivable
outstanding as
at 31
December
2021
OpenGate Capital
Management, LLC
(6,000)
-
(6,000)
-
Transactions relating to OpenGate Capital Management, LLC include certain corporate
infrastructure monitoring services and certain transaction advisory services, including with respect
to the acquisition of the subsidiary.
The above-mentioned transactions were conducted on an arm’s length basis.
28. COMMITMENTS
Non-cancellable leases
From 1 January 2019, the Group has recognized right-of-use assets and lease liability for these
leases (Note 25). Future lease payments as of 31 December 2021 and 31 December 2022 are
disclosed in Note 3.2.
Guarantees, pledges and other collateral
All of the assets of the Group have been pledged to jointly secure senior secured bonds pursuant
to the super senior RCF provided by Nordea Bank AB, filial in Norge (“Nordea”), the hedging
arrangements with Nordea and the bonds, pursuant to the terms of an intercreditor agreement.
Nordic Trustee AS is acting as security agent and holds all security on behalf of Nordea in its
capacity as lender and hedge counterparty and on behalf of the bondholders. The super senior
RCF was entered into on 20 October 2021 and the terms and conditions for the bonds were
entered into on 1 October 2021.
Page 74 | Jøtul AS annual report 2022
Jotul AS
Notes to the Consolidated Financial Statements
for the year ended 31 December 2022
The Group provided a bank guarantee of NOK 13,850 thousand to the property
lessor Festningsveien 2 AS and EUR 808 thousand, equivalent of NOK 8,075 (2021: EUR
804 thousand, equivalent of NOK 8,033 thousand) to the property lessor Prologis Poland
LXXXIII Sp.z.o.o.
29. SUBSEQUENT EVENTS
As of the date of this report, the directors are not aware of any subsequent events that
may materially impact these financial statements and accompanying notes.
30. APPROVAL BY THE BOARD OF DIRECTORS
The consolidated financial statements were approved and authorized for issue by the Board
of Directors on 4 May 2023.
31. JØTUL AS STANDALONE ANNUAL ACCOUNTS
Page 75 | Jøtul AS annual report 2022
JØTUL AS | ANNUAL REPORT 2022
Page 76 | Jøtul AS annual report 2022
Content
JØTUL AS
3 Financial Statements
8 Notes
19 Auditors Report
Page 77 | Jøtul AS annual report 2022
All amounts in 1000 NOK
Note
2022
2021
Revenue 1 634,552 526,354
Revenue from group companies 1 509,599 292,169
Other operating income 1,2 4,705 4,744
Total operating income
1,148,856
823,268
Cost of Goods Sold 3 697,829 450,708
Change in inventory 3 -1,660 -7,559
Payroll expenses 4,5 115,259 105,485
Depreciation 2 18,957 19,518
Other operating expenses 2,4,6 165,774 171,180
Total operating expenses
996,158
739,332
Operating profit
152,698
83,936
Income from subsidiaries 6,877 0
Interest received from group companies 11,955 12,154
Other financial income 7 18,636 6,058
Total financial income
37,468
18,212
Write-Down financial fixed assets 8 56,207 0
Interest paid to group companies 9 194 25,938
Other financial expenses 10 61,808 27,443
Total financial expenses
118,209
53,381
Net financial items
-80,742
-35,169
Result before tax
71,956
48,766
Income tax expense 11 -83,883 109
Result after taxes
155,839
48,657
Net profit for the year
155,839
48,657
Allocated to other equity 12 155,839 48,657
Total amount allocated
155,839
48,657
Jøtul AS Org.nr. 989 519 247
Jøtul AS
Income Statement
Page 78 | Jøtul AS annual report 2022
All amounts in 1000 NOK
Note
2022
2021
Assets
Fixed assets
Intangible fixed assets
Research and development 2 47,469 40,744
Other intangible assets 2 15,620 11,076
Trademarks 2 46,000 46,000
Deferred tax asset 11 84,179 0
Total intangible fixed assets
193,268
97,820
Tangible fixed assets
Land, buildings and other property 2 1,247 1,412
Machinery and plant 2 29,678 29,449
Fixtures and fittings, tools etc 2 2,687 2,251
Total tangible fixed assets
33,612
33,112
Financial fixed assets
Investments in subsidiaries 8 337,580 124,332
Investments in shares 0 3
Other receivables financial assets 13 8,550 10,800
Total financial fixed assets
346,130
135,135
Total fixed assets
573,010
266,067
Current assets
Inventory
3
58,586
61,045
Receivables
Accounts receivable 53,770 50,175
Accounts receivable with group companies 14 101,959 46,205
Other receivables with group companies 14 178,834 332,845
Other receivables 6,043 5,015
Total receivables
340,605
434,240
Cash and cash equivalents
15
39,812
13,972
Total current assets
439,003
509,257
Total assets
1,012,013
775,323
Jøtul AS
Balance Sheet
Jøtul AS Org.nr. 989 519 247
Page 79 | Jøtul AS annual report 2022
All amounts in 1000 NOK
Note
2022
2021
Equity and liabilities
Equity
Contributed equity
Share capital 12,16 139,414 139,414
Share premium reserve 1,026,612 1,026,612
Total contributed equity
1,166,026
1,166,026
Retained earnings
Uncovered loss 12 -902,833 -1,058,672
Total retained earnings
-902,833
-1,058,672
Total equity
263,193
107,354
Liabilities
Allowances for liabilities
Other provisions 2 14,115 18,820
Total provisions
14,115
18,820
Non-current liabilities
Subordinated debt 9 33,568 30,551
Bonds 18 466,639 461,861
Total non-current liabilities
500,207
492,412
Current liabilities
Liabilities to financial institutions 17 0 19,658
Accounts payable 52,368 37,910
Accounts payable with group companies 93,510 46,105
Public duties payable 15 18,503 19,587
Other short term liabilities 18 70,117 33,477
Total current liabilities
234,498
156,737
Total liabilities
734,705
667,969
Total equity and liabilities
1,012,013
775,323
Balance Sheet
Jøtul AS
Jøtul AS Org.nr. 989 519 247
Page 80 | Jøtul AS annual report 2022
Page 81 | Jøtul AS annual report 2022
All amounts in 1000 NOK
Note
2022
2021
Cash flows from operating activities
Result before tax 71,956 48,766
Income taxes paid 11 -296 -109
Loss/gain on sale of assets 2 -8,192 2,506
Depreciation/amortisation 2 18,957 19,518
Impairment of shares in subsidiaries 8 56,207 0
Change in inventories 3 2,459 311
Change in trade receivables -59,349 -33,976
Change in trade payables 61,863 -19,628
Change in other accruals/prepayments 29,824 8,525
Net cash flows from operating activities
173,429
25,913
Cash flows from investing activities
Payments to acquire fixed assets 2 -5,612 -13,066
Payment for purchase of intangible assets 2 -25,202 -6,516
Receipt from other loan receivables (short-/long-term) 13 2,250 0
Receipt from sales of shares 8 8,383 0
Payments for capital increase group subsidiaries 8 -45,946 -10,028
Net cash flows from investing activities
-66,127
-29,609
Cash flows from financing activities
Change Bank overdraft used 17 0 11,456
Change Net payout overdraft 17 -19,658 0
Receipt/Payment of loan group (short-/long-term) 9,14 -66,582 -477,912
Receipt from issue of other liabilities (short-/long-term) 18 4,778 461,861
Cash flows from financing activities
-81,462
-4,595
Net cash flow for the period
25,840
-8,291
Cash and cash equivalents at the beginning of the period 15 13,972 22,263
Cash and cash equivalents at the end of the period
39,812
13,972
Consisting of:
Bank deposits etc.
39,812
13,972
Unutilised RCF 15
40,000
20,342
Jøtul AS Org.nr. 989 519 247
Jøtul AS
Cash Flow Statement
Page 82 | Jøtul AS annual report 2022
All figures are in NOK’000 unless stated otherwise.
Jøtul AS - Notes to the Financial Statements
Organisation nr. 989 519 247
Fixed assets are capitalised and depreciated on a straight-line basis over the expected useful life of the assets, provided they have a
useful life exceeding three years and a cost price exceeding NOK 15,000. Maintenance of fixed assets is expensed as incurred and
classified as an operating expense. Additions or improvements are added to the cost of the asset and depreciated in line with the
fixed asset. The differentiation between what constitutes maintenance and addition/improvement is based on the condition of the
fixed asset on acquisition of the fixed asset.
Leased fixed assets are recognised as fixed assets if the lease agreement is considered a finance lease.
Subsidiaries are measured according to the cost method in the company financial statements. The investment is measured at the
cost of the shares unless impairment has been necessary.
Dividends and group contribution are recognised as income in the same year that the amounts are provided for in the subsidiary. To
the extent that dividends and/or group contributions exceed the share of post-acquisition retained earnings, the excess amount is
considered a repayment of invested capital, and reduces the carrying value of the investment recognised in the balance sheet.
Receivables, cash and liabilities in foreign currencies are translated at the balance sheet date rate of exchange. Foreign exchange
gains and losses related to sale and purchase of goods in foreign currencies are recognised as foreign exchange gains/foreign
exchange losses. Exchange rates at the time of transaction are used for transactions in foreign currency.
Subsidiaries
Foreign currency
Intangible assets
Fixed assets
Current assets are measured at the lower of cost and fair value. Current liabilities are recognised at their nominal amount.
Non-current assets are recognised at cost of acquisition. Fixed assets that depreciate in value, are depreciated on a straight-line
basis over their expected economic life. Fixed assets are written down to fair value on impairment if required by accounting
standards. Non-current liabilities in Norwegian kroner, with the exception of other provisions, are measured at their nominal
amount on initial recognition. Provisions are discounted if the interest element is material.
Revenue recognition from the sale of goods occurs at the time of delivery. Revenue in foreign currency is recognised at the
prevalent monthly exchange rates during the year. Services are recognised as they are performed.
Assets that are held for permanent ownership or use are classified as non-current assets. Assets that relate to the flow of goods are
classified as current assets. Receivables are classified as current asset if they are due to be repaid within one year of the time of
payment. Liabilities are based on analogous criteria.
Expenditure related to intangible assets is capitalised to the extent that the criteria for recognition of an asset are met. This entails
that such expenditure is capitalised when it is considered probable that the future economic benefits associated with the asset will
flow to the company, and the cost of the asset can be reliably measured. Capitalised intangible assets are amortised on a straight-
line basis over their expected useful life. Exempt are Trademarks, which follow an impairment test performed annually.
Jøtul AS
Notes to the Financial Statements 2022
Summary of accounting policies
Revenue
Classification and assessment of balance sheet items
The annual financial statements have been prepared in accordance with the Accounting Act and generally accepted accounting
principles in Norway (NGAAP).
Page 83 | Jøtul AS annual report 2022
Jøtul AS - Notes to the Financial Statements
Organisation nr. 989 519 247
Jøtul AS
Notes to the Financial Statements 2022
Summary of accounting policies
Taxation
Events after the balance sheet date
The income tax expense in the income statement includes both the tax payable for the period and changes in deferred tax.
Deferred tax is calculated using the actual tax rate based on the temporary differences existing between the carrying amounts and
tax values, as well as any tax losses carried forward at the end of the financial year. Tax increasing and tax reducing temporary
differences that reverse or could reverse in the same period are offset. The company has not recognised deferred tax assets on net
tax reducing differences that are not offset and losses carried forward.
Expected costs for future warranties related to sales are expensed and recognised as a provision in the balance sheet. The provision
is based on historical experience for warranties.
Inventories
Inventories of purchased goods are measured at the lower of cost according to the FIFO principle and fair value. Own manufactured
finished goods and work in progress are measured at full manufacturing cost. An impairment is charged if the fair value (sales price
reduced by selling costs) is lower than the cost price. Selling costs include all remaining sales-, administration- and storage costs.
Receivables
Trade receivables and other receivables are recognised in the balance sheet at the nominal amount reduced by provisions for
expected losses. Provisions for losses are made based on an individual assessment of the individual receivables. For smaller trade
receivables, an unspecified provision is made to cover expected losses.
Warranty obligations
Impairment of non-current assets
An impairment test is performed when there is an indication that the carrying value of a non-current asset is higher than its fair
value. The test is conducted at the lowest level of non-current assets that has independent cash flows. If the carrying value is higher
than both the sales value and the recoverable amount (present value of continued use/ownership), an impairment charge to the
higher of sales value and recoverable amount is made. Previous impairment losses are reversed if the conditions for the impairment
are no longer present (with the exception of e.g. impairment of goodwill).
The statement of cash flows is prepared using the indirect method. Cash and cash equivalents include cash, bank deposits and other
short-term, liquid deposits that may immediately and with insignificant currency risk be converted to known cash amounts and with
a due date of less than three months from the date of acquisition.
Loans are recognised at fair value at the time of inception. In subsequent periods, loans are measured at amortised cost using the
effective interest method. Loans are classified as current liabilities unless there is an unconditional right to defer payment of the
liability for more than 12 months from the balance sheet date.
Loans
Statement of cash flows
New information after the balance sheet date about the financial position of the company as at the balance sheet date is
recognised in the annual financial statements. Events after the balance sheet date that do not have an impact on the company’s
financial position as at the balance sheet date, but which will affect the company’s financial position in the future, are disclosed if
this is material, see note 19.
Page 84 | Jøtul AS annual report 2022
Note 1
Revenue by Country / Region of Destination
The Company’s revenue specified by main markets:
2022
2021
Norway
322,443
287,860
Nordics other
76,492
50,565
Europe exc. Nordics
657,370
391,669
North America
62,325
37,091
Other
30,226
56,083
Total
1,148,857
823,268
Note 2
Fixed assets and leasing costs
Trademarks
R&D
Software
Property
Machinery
and plant
Fixtures
Total
Acquisition cost at 1 Jan.
190,000
224,455
27,664
1,626
268,380
21,744
733,869
+ Additions
16,690
8,423
4,823
878
30,814
- Disposals
9,724
-
2,679
-
18,450
-
5,594
-
36,447
-
Acquisition cost at 31 Dec.
190,000
231,422
33,408
1,626
254,752
17,028
728,236
Acc. Depr/Amort/Imp. 1 Jan.
144,000
-
183,711
-
16,588
-
214
-
238,930
-
19,492
-
602,937
-
+ Depreciation/Amortisation
9,965
-
3,879
-
165
-
4,505
-
443
-
18,957
-
- Disposals Acc Depreciation
9,724
2,679
18,361
5,594
36,358
Acc. Depr/Amort/Imp. 31 Dec.
144,000
-
183,953
-
17,788
-
379
-
225,074
-
14,341
-
585,535
-
Balance as per 31 Dec.
46,000
47,469
15,620
1,247
29,678
2,687
142,701
Period of ordinary Amort./Depr. 4 4 20 10-15 3-8
Deferred income at 31.12.2022
Deferred income from gain on sale of factory building
11,589
Deferred income from gain on sale of shares
2,527
Total other provisions for obligations
14,115
Rental and leasing
arrangements:
Annual
Cost
Office and factory
17,479
2032, renewable
Lease contract
Warehouse
9,474
2032, renewable
Lease contract
Trucks
1,692
2 years renewable
Lease contract
Company cars
1,931
4 years renewable
Leasing
IT equipment
5
3 years renewable
Leasing
Total 30,581
Jøtul AS - Notes to the Financial Statements
Organisation nr. 989 519 247
Year of
expiry / duration
The Company capitalise research and development cost related to product development; product specifications, design,
drawings etc. as intangible assets. The product development process follows a clearly identified policy, overseen by an internal
body, with a project start, pre-study, concept development, detailed development, industrialisation & launch.
Type
Fixed assets are depreciated on a straight-line basis.
The Company sold the factory building, as well as the shares, of Jøtul Eiendom AS (which owned the company’s leased-back
administration building) at the beginning of 2006. The lease agreement was determined to be an operating lease. The gain on
disposal of the building/shares was in total NOK 93,694,794. Due to severe difficulties in determining the market value of the
company’s properties without a leaseback agreement, the gain is recognised over the rental term. The gain recognised in 2022
is NOK 4,705,104.
Trademarks with indefinite useful lives at 31 December 2022 amounting to NOK 46,000 thousand are not amortised (2021:
NOK 46,000 thousand). As Jøtul has a history of more than 170 years and the management has no plans to abandon the
trademarks in the near future, the useful lives for the trademarks are assumed to be indefinite. The Company tests whether
trademarks have suffered any impairment on an annual basis.
Notes to the Financial Statements 2022
Jøtul AS
Page 85 | Jøtul AS annual report 2022
Note 3
Inventory
By inventory category
2022
2021
Raw materials
4,627
2,271
Work in Progress
-
675
Finished goods
23,491
31,514
Trading goods
30,467
26,584
Total
58,586
61,045
Obsolescence provision recognised
4,444
5,537
Expensed obsolescence provision
1,093
726
-
Category 1
No sale/usage last 36 months, allowance of 100% of manufacturing cost
Category 2
No sale/usage last 24 months, allowance of 50% of manufacturing cost
Category 3
Note 4
Employee benefits expense, number of employees, remuneration to management and representatives
The average number of full time equivalents during the financial year is 153 people.
Specification of employee benefits expense
2022
2021
Salaries
88,520
82,396
Social security
13,979
13,462
Pension cost
3,784
3,574
Other payroll related benefits
8,976
6,052
Total
115,259
105,485
Remuneration to leading employees
CEO 2022 2021
Salary 3,458 3,487
Pension 321 321
Other benefits 617 873
Members of the Board - -
No loans or credits have been given to leading employees or key persons.
The Company has contribution based pension arrangements including 164 people.
The Company’s pension arrangements satisfy the regulations for mandatory occupational pensions.
Fees to auditor, exclusive of VAT:
2022
2021
Audit 1,489 735
Total fees to auditors
1,489
735
Jøtul AS - Notes to the Financial Statements
Organisation nr. 989 519 247
The CEO has a notice period of 6 months in addition to rights to compensation for 6 months. The CEO has a bonus agreement
which is limited to a maximum of 50% of the base salary.
Notes to the Financial Statements 2022
Jøtul AS
Company policy is to hold spare parts for all products that have been manufactured in the last 10 years in inventory, and the
Company’s criteria for calculating obsolescence is:
Inventory larger than sale/usage of the last 12 months on outgoing products are accrued by
25% of manufacturing cost.
Page 86 | Jøtul AS annual report 2022
Note 5 Related parties
Information about and remuneration to leading employees are shown in note 4 Employee benefits expense.
Liabilities to related parties have been described in note 9.
No leading employees have a shareholding exceeding 1 %. Ref. note 16 Share capital.
The Company has purchased management services from Open Gate of approx. MNOK 6 in 2022.
Note 6
Other Operating Expense
2022
2021
Shipping and distribution cost
20,032
26,613
Rental of buildings and machinery
33,670
33,615
Selling and marketing costs
20,083
23,249
Production and maintenance costs
21,334
15,868
Management fees
6,260
6,000
Other administration and operating expenses
64,395
65,836
Total other operating expense
165,774
171,180
Note 7
Other finance income
2022
2021
Interest income bank
531
-
Other interest income
8,519
8
-
Foreign exchange gain
9,586
6,066
Total
18,636
6,058
Note 8
Subsidiaries
Investments in subsidiaries are accounted for in accordance with the cost method.
Company Year of
acquisition
Share Equity
31.12
Result
2022
Carrying
value
31/12
Jotul North America Inc.
1979
100 %
95,308
10,677
25,000
Jotul France S.A.
1983
100 %
31,971
786
16,000
Jotul UK Ltd.
2000
100 %
15,828
737
2,800
Jotul Hispania S.L.
1)
2006
100 %
100
-
Scan A/S
2006
100 %
13,477
1,283
41,439
Jotul Italy s.r.l
2007
100 %
8,526
1,364
3,960
Jotul Poland sp. zo. o.
2019
100 %
103,105
15,223
248,381
Aico Italy s.r.l
2)
2021
100 %
22,823
-
49,903
-
-
Carrying value at 31.12
337,580
1)
Jotul Hispania S.L. was sold to Jotul France S.A. on 25/05/22 (transaction value MNOK 2.28)
2)
The company has in 2022 made an write-down of the shares in Aico Italy s.r.l of MNOK 56
Jøtul AS - Notes to the Financial Statements
Organisation nr. 989 519 247
Milano, Italy
Jøtul AS
Notes to the Financial Statements 2022
In 2006, the Company sold the factory building and office building with a leaseback term of 20 years, with an option for an
additional 20 years, to a consortium that established two limited companies for the purpose of owning and operating the
properties. In 2012, the Company extended the lease agreement to include a new warehouse and manufacturing facility. The
shareholders of Jøtul AS, leading employees, the Board or other key persons do not own any interest in these limited companies.
Business office
Portland, USA
Dardilly, France
Worcestershire, UK
Zaragosa, Spain
Vissenbjerg,Denmark
Milano, Italy
Wroclaw, Poland
Page 87 | Jøtul AS annual report 2022
Note 9
Long-term liabilities group companies
The interest rate set to 9 % and accrued interest in 2022 is MNOK 2.83
Note 10
Other finance expense
2022
2021
Bank charges
2,460
3,582
Interest/fees bank overdraft, amortised estab. costs
9,222
12,441
Interest to suppliers
141
310
Interest factoring
1,871
1,027
Bond Finance Cost
4,870
1,194
Bond interest expense
43,065
8,713
Other interest expense
180
176
Total
61,808
27,443
Jøtul AS - Notes to the Financial Statements
Organisation nr. 989 519 247
* The Company’s fixed interest- and forward contracts are measured at fair value in the balance sheet, and changes in fair value are recognised in the income
statement (as unrealised currency gains/losses). Refer also to note for “Financial market risk, fixed interest- and forward contracts”.
A loan of MNOK 26 has been issued by the principal shareholder, Jotul Holdings S.a.r.l, with calculated interest in accordance to
the loan agreement.
Jøtul AS
Notes to the Financial Statements 2022
Page 88 | Jøtul AS annual report 2022
Note 11
Income tax expense, deferred tax and income tax payable
Temporary differences included in the basis for deferred tax/deferred tax asset
2022
2021
Fixed assets 29,053 26,303
Inventory 2,932- 1,477-
Receivables 985- 457-
Financial instruments 8,361 13,139
Gain and loss account 1,546 1,932
Deferred revenue 11,589- 15,452-
Warranty provision 3,590- 1,590-
Net temporary differences 19,864 22,399
Losses and tax credits carried forward 399,942- 517,895-
Restricted interest deduction carried forward 2,555- 2,555-
Basis for deferred tax/deferred tax assets in the balance sheet 382,633- 498,052-
Deferred tax/deferred tax asset 84,179- 109,571-
Deferred tax assets not recognised - 109,571
Deferred tax/deferred tax asset recognised in the financial statements 84,179- 0-
Basis for income tax expense, change in deferred tax and income tax payable
Result before tax 71,956 48,766
Permanent differences 43,463 11,118
Change in temporary differences incl. in the basis for deferred tax/deferred tax asset 2,535 18,491-
Taxable income before utilising losses carried forward 117,953 41,394
Change in losses and allowances carried forward 117,953- 41,394-
Taxable income (basis for income tax payable in the balance sheet) - -
Specification of permanent differences
Dividends from subsidiaries 6,877- -
Other non-deductible expenses and non-taxable income 50,340 11,118
Total permanent differences 43,463 11,118
Split of the income tax expense
Income tax expense from foreign operations 296 109
Total income tax payable - -
Change in deferred tax/deferred tax asset 84,179- -
Income tax expense 83,883- 109
Note 12
Equity
Share
Capital
Share
Premium
Losses
carried
forward
Total Equity
As of 1 January
139,414
1,026,612
1,058,672
-
107,354
Result of the year
155,839
155,839
As of 31 December
139,414
1,026,612
-902,833
263,193
Jøtul AS - Notes to the Financial Statements
Organisation nr. 989 519 247
Jøtul AS
Notes to the Financial Statements 2022
Page 89 | Jøtul AS annual report 2022
Note 13
Financial market risk, fixed interest- and forward contracts
Note 14
Other receivables from group companies
2022
2021
Trade receivables from group companies
101,959
46,205
2022
2021
Group Cash Pool
1)
178,834
284,856
Other receivables from subsidiaries
0
-
47,988
Total Other receivables from group companies 178,834 332,845
1)
Jøtul AS is the principal account owner in a cash pool arrangement and is therefore in effect bank for its subsidiaries.
Note 15
Bank deposits, cash etc.
The Company has restricted bank deposits to cover employee withholding tax due of:
4,729
Drawn portion of MNOK 40 revolving credit facility as at 31 December 2022:
-
Jøtul AS - Notes to the Financial Statements
Organisation nr. 989 519 247
The company has in 2022 purchased products of MNOK 467 and services of MNOK 30 from subsidiaries. Purchasing of products
are mainly related to finished products from Poland, while services mainly consist of R&D and Sales services.
Jøtul AS
Notes to the Financial Statements 2022
The parent company, Jøtul AS, has entered into a loan engagement with its bank, Nordea, which among other things includes a
multi-currency bank overdraft facility for the entire Group. The subsidiaries are included in the cash pool system and every
company has a bank overdraft tied to its account. Jøtul AS manages the system and distributes the overdraft facility to the
individual companies as required. Every subsidiary has a loan- or deposit relationship with Jøtul AS and not with external financial
institutions. The subsidiaries have a joint responsibility to Nordea for the obligations of Jøtul AS in accordance with Jøtul AS’
agreement with Nordea.
An interest-bearing loan of MNOK 13.5 has been given to Festningsveien 2 AS in connection with their building of a new
warehouse and manufacturing facility for the company’s plant in Kråkerøy. The current balance of the loan on 31.12.2022 was
MNOK 8.6, of which MNOK 2.25 is current receivable.
The Company’s loans, long-term and bank overdrafts, have floating interest rates in NOK, USD, EUR, GBP, SEK, DKK and PLN and
are consequently exposed to fluctuations in general interest levels.
The Company is exposed to foreign currency risk mainly related to sales in foreign currencies. Fluctuations in foreign currencies
are hedged through forward contracts. As per 31.12.2022 the Company has not entered any forward contract to hedge against
foreign currency fluctuations related to sales in foreign currencies.
The Company has no debt that expiry later than 5 years.
Page 90 | Jøtul AS annual report 2022
Note 16
Share capital and shareholders
All amounts in the note are in single NOK.
The Company had 1 shares, with nominal value of NOK 139,413,732. Total share capital is NOK 139,413,732.
The Company’s shares are split into the following share classes:
Share class
Number
shares
Ordinary shares
1
Total
1
The Company has following shareholders:
Name
Country Amount Share Voting Right Dividend
Right
Jotul Holdings S.a.r.l
Luxembourg
1
100 %
100 %
100 %
Note 17
Debt to credit institutions and mortgages
2022
2021
Bank overdraft
-
19,658
Total debt to credit institutions
-
19,658
Carrying value of mortgaged assets:
2022
2021
Fixed Assets
96,701
84,932
Trade receivables
53,770
50,175
Trade receivables group companies
101,959
46,205
Inventory
58,586
61,045
Shares in subsidiaries
337,580
124,332
Total mortgaged assets
648,595
366,688
Jøtul AS - Notes to the Financial Statements
Organisation nr. 989 519 247
All of the assets of the Group have been pledged to jointly secure senior secured bonds pursuant to the super senior RCF provided
by Nordea Bank AB, filial in Norge (“Nordea”), the hedging arrangements with Nordea and the bonds, pursuant to the terms of an
intercreditor agreement. Nordic Trustee AS is acting as security agent and holds all security on behalf of Nordea in its capacity as
lender and hedge counterparty and on behalf of the bondholders. The super senior RCF was entered into on 20 October 2021 and
the terms and conditions for the bonds were entered into on 1 October 2021.
The Group provided a bank guarantee of KNOK 13.850 to the property lessor Festningsveien 2 AS and KEUR 808, equivalent of
KNOK 8.075 (in 2021: KEUR 804, equivalent of KNOK 8.033) to the property lessor Prologis Poland LXXXIII Sp.z.o.o.
Jøtul AS
Notes to the Financial Statements 2022
139,413,732 139,413,732
Total Nominal amount
139,413,732 139,413,732
nominal value per share
Page 91 | Jøtul AS annual report 2022
Note 18
Senior Secured Bond
2022
2021
Opening balance at 01/01
475,000
-
Issue of Bond
-
475,000
Valuation / Amortisation
8,361
-
13,139
-
Closing balance at 31/12 466,639 461,861
Interest accrued on bonds during the year
11,626
8,713
Current
11,626
8,713
Non-current
466,639
461,861
(i)
(ii)
(iii)
(iv)
(v)
Jøtul AS - Notes to the Financial Statements
Organisation nr. 989 519 247
Jøtul AS
Notes to the Financial Statements 2022
On 6 October 2021, the Company issued a 3-year MNOK 475 senior secured bonds with ISBN NO0011104069. The bonds bear a
floating rate coupon of 6,95% plus 3 months NIBOR with coupon payments quarterly. The bond has a maturity date of 6 October
2024.
The Company has a possibility to issue bonds up to a maximum total nominal amount of MNOK 750 (representing sum of initial
bonds, subsequent bonds and PIK bonds) under the terms and conditions of the listed bond.
The Issuer may redeem all, but not only some, of the outstanding Bonds in full:
Redemption in accordance with Clause 9.3(a) shall be made by the Issuer giving not less than 15 Business Days’ notice to the
Bondholders and the Agent. Upon receipt of such notice, the Agent shall inform the Paying Agent. Any such notice is irrevocable but
may, at the Issuer's discretion, contain one or more conditions precedent. The notice shall specify the Call Option Repayment Date.
Upon expiry of such notice and the fulfilment of the conditions precedent (if any), the Issuer is bound to redeem the Bonds in full at
the applicable amounts.
Unless the redemption price is set out in the written notice where the Issuer exercises its right to redemption in accordance with
Clause 9.3(a)(i), the Issuer shall publish the redemption price to the Bondholders as soon as possible and at the latest within three
Business Days from the date of the notice.
For the purpose of calculating the remaining interest payments pursuant to paragraph (a)(i) above it shall be assumed that the
Interest Rate for the period from the relevant Record Date to the First Call Date will be equal to the Interest Rate in effect on the
date on which notice of redemption is given to the Bondholders. The relevant Record Date shall be agreed upon between the
Issuer, the CSD and the Agent in connection with such repayment.
The bonds were listed on Oslo Børs in October 2022.
any time from and including the First Issue Date to, but excluding, the First Call Date at an amount per Bond equal to 103.475
per cent. of the Nominal Amount plus the remaining interest payments to, and including, the First Call Date, together with
accrued but unpaid Interest;
any time from and including the First Call Date, but excluding, the first CSD Business Day falling 24 months after the First Issue
Date at an amount per Bond equal to 103.475 per cent. of the Nominal Amount, together with accrued but unpaid Interest;
any time from and including the first CSD Business Day falling 24 months after the First Issue Date to, but excluding, the first
CSD Business Day falling 30 months after the First Issue Date at an amount per Bond equal to 102.085 per cent. of the
Nominal Amount, together with accrued but unpaid Interest;
any time from and including the first CSD Business Day falling 30 months after the First Issue Date to, but excluding, the first
CSD Business Day falling 33 months after the First Issue Date at an amount per Bond equal to 100.695 per cent. of the
Nominal Amount, together with accrued but unpaid Interest; and
any time from and including the first CSD Business Day falling 33 months after the First Issue Date to, but excluding, the Final
Maturity Date at an amount per Bond equal to 100 per cent. of the Nominal Amount, together with accrued but unpaid
Interest.
Page 92 | Jøtul AS annual report 2022
Note 19
Subsequent Events
Jøtul AS - Notes to the Financial Statements
Organisation nr. 989 519 247
No other significant events have occurred in the period from the balance sheet date to the date of approval of the financial
statements that have affected the financial position of the Company to a material degree and which should have been reflected in
the financial statements presented.
Jøtul AS
Notes to the Financial Statements 2022
Page 93 | Jøtul AS annual report 2022
549300Q04IHV3V82QT542022-01-012022-12-31549300Q04IHV3V82QT542021-01-012021-12-31549300Q04IHV3V82QT542022-12-31549300Q04IHV3V82QT542021-12-31549300Q04IHV3V82QT542020-12-31ifrs-full:IssuedCapitalMember549300Q04IHV3V82QT542021-01-012021-12-31ifrs-full:IssuedCapitalMember549300Q04IHV3V82QT542021-12-31ifrs-full:IssuedCapitalMember549300Q04IHV3V82QT542020-12-31ifrs-full:SharePremiumMember549300Q04IHV3V82QT542021-01-012021-12-31ifrs-full:SharePremiumMember549300Q04IHV3V82QT542021-12-31ifrs-full:SharePremiumMember549300Q04IHV3V82QT542020-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember549300Q04IHV3V82QT542021-01-012021-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember549300Q04IHV3V82QT542021-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember549300Q04IHV3V82QT542021-01-012021-12-31ifrs-full:ReserveOfRemeasurementsOfDefinedBenefitPlansMember549300Q04IHV3V82QT542021-12-31ifrs-full:ReserveOfRemeasurementsOfDefinedBenefitPlansMember549300Q04IHV3V82QT542020-12-31ifrs-full:RetainedEarningsMember549300Q04IHV3V82QT542021-01-012021-12-31ifrs-full:RetainedEarningsMember549300Q04IHV3V82QT542021-12-31ifrs-full:RetainedEarningsMember549300Q04IHV3V82QT542020-12-31549300Q04IHV3V82QT542022-01-012022-12-31ifrs-full:IssuedCapitalMember549300Q04IHV3V82QT542022-12-31ifrs-full:IssuedCapitalMember549300Q04IHV3V82QT542022-01-012022-12-31ifrs-full:SharePremiumMember549300Q04IHV3V82QT542022-12-31ifrs-full:SharePremiumMember549300Q04IHV3V82QT542022-01-012022-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember549300Q04IHV3V82QT542022-12-31ifrs-full:ReserveOfExchangeDifferencesOnTranslationMember549300Q04IHV3V82QT542022-01-012022-12-31ifrs-full:ReserveOfRemeasurementsOfDefinedBenefitPlansMember549300Q04IHV3V82QT542022-12-31ifrs-full:ReserveOfRemeasurementsOfDefinedBenefitPlansMember549300Q04IHV3V82QT542022-01-012022-12-31ifrs-full:RetainedEarningsMember549300Q04IHV3V82QT542022-12-31ifrs-full:RetainedEarningsMemberiso4217:NOK