CVR no. 60 69 88 13
ANNUAL REPORT 2024
SAFETY &
SUPPORT
AT SEA
OUR BUSINESS 4
MANAGEMENT REVIEW
CEO statement 6
Business performance 8
Key figures for the consolidated group 12
SIGNATURES
Management’s statement 14
Independent auditor’s report 15
CONTENTS
FINANCIAL STATEMENTS
Statement of profit and loss 18
Statement of comprehensive income 18
Statement of financial position 19
Statement of changes in equity – Group 20
Statement of changes in equity – Parent 21
Cash flow statement 22
Notes 23
COMPANY INFORMATION 51
ESVAGT ANNUAL REPORT 2024
3
OUR BUSINESS
ESVAGT was established in 1981 and today is a
leading provider of safety and support at sea for
the offshore wind and oil & gas industries.
ESVAGT’s fleet comprises of 42 modern offshore support vessels built to the best
standards and operated by more than ~1,200 professional crew members all
trained for safe and efficient operations in harsh weather conditions.
The services ESVAGT offers comprise of Service Operation Vessels (SOVs) supporting
offshore wind farm operators, and Emergency Response and Rescue Vessels (ERRVs)
working as stand by and service vessels for offshore oil & gas companies.
Revenue growth
last 5 years
Revenue 2024
Vessels on order Customer SatisfactionTotal Vessels
Safety transfers of
Personnel by SOV’s
more than
Rescued peopleTotal employees
Uptime
50%
1,470
mDKK
4 5.6 out of 6
42
˷650,000
149
~1,30 0
99.6%
ESVAGT ANNUAL REPORT 2024
4
Kristian Jakobsen and Søren Karas
CO-CEOS, ESVAGT A/S
CEO statement
ESVAGT’s 2024 revenue grew to an all-time high
of 1,470 million DKK, driven by high uptime and
performance in the Wind segment, as well as robust
trading for ERRVs notably in the 1st half of 2024. The
revenue growth combined with disciplined cost control
in the face of continued inflationary pressures also
secured an all-time high EBITDA of 509 million DKK.
ESVAGT’s revenue
increased by 50%
the last 5 years.
50%
STRONG RESULTS
AND GROWTH, BUT
SOME SHORTTERM
HEADWINDS
During 2024 we continued to cement our growth within the
renewables segment and signed a long-term charter with
Vestas, for a new build Service Operation Vessel (SOV) to be
delivered in 2026 for the Hollandse Kust West Windfarm.
This brings our newbuilding program to a total of 4 SOVs, all
being built to long-term contracts. Furthermore, to prepare
for additional future growth, a new Capex funding facility was
raised on attractive terms. The process was oversubscribed,
ESVAGT ANNUAL REPORT 2024
6
is fortunately back to work in ESVAGT, and precautions have
been taken to ensure no recurrence.
ESVAGT is focused on creating an attractive work envi-
ronment, and again in 2024 we were grateful to see this
recognized in our annual Employee Engagement Survey,
which reached 4.5 out of 5. Similarly, our continued emphasis
on operational excellence and customer focus was again
recognized in our annual Customer Satisfaction Survey, this
year with a score of 5.6 out of 6.
In addition to being an enabler of the green transition,
ESVAGT is focused on reducing our customers and own
environmental footprint. We continue to explore new fuel
alternatives and during 2024 we progressed development of
our two pioneering E-Methanol SOVs under construction for
long-term contracts with Orsted.
Looking ahead we see robust growth in the Wind segments.
Recent years have been more challenging for offshore
wind farm developers due to a combination of e.g. infla-
tion, higher interest rates and slow government processes,
but this abated somewhat in 2024, and we are seeing an
increase in the pipeline of projects while at the same time
most key countries have increased their 2030 GW targets,
which requires a significant expansion of capacity. Whereas
some targets look increasingly likely to only be achieved
after 2030, the efforts to close the gap will drive a significant
growth in SOV demand in the coming years.
In the US, the outlook is uncertain in the short/medium-term.
For ESVAGT there is no immediate impact, as our one SOV
under construction for our Joint Venture with Crowley, is
Supported by superior operational execution, high
customer satisfaction, engaged employees, and a strong
financial foundation, ESVAGT is strategically well
positioned to pursue continued profitable growth
”
already committed to a long-term contract with Siemens on
the Dominion Wind Farm that is moving ahead as planned.
For the ERRV markets the outlook for 2025 is somewhat
mixed, with healthy outlook for our long-term contracts in
Norway and Denmark, whereas the UK market saw a decline
in 2024, notably in the second half, owing to challenging
industry dynamics because of unfavorable fiscal policies.
We expect a sluggish 2025 and while UK is the smallest of
ESVAGT’s markets, there will be some effects to our results.
Longer term we are encouraged by the UK Government’s
recent announcement that it recognizes solutions must be
found to ensure the oil and gas industry can thrive during
the renewable transition.
ESVAGT’s good results for 2024 were facilitated by a
balanced focus on growth and strict cost management, and
this will remain key for 2025. This will be required to continue
delivering acceptable performances, but more importantly
also for ESVAGT to stay competitive and help its customers
enable the renewable transition.
Kristian Ole Jakobsen & Søren Karas
CO-CEO's, ESVAGT A/S
which confirms the strong market confidence in ESVAGT as
the leading contract-backed SOV operator.
Our Emergency Response and Rescue Vessel (ERRV) business
performed very satisfactorily during 2024, as core markets
saw robust activity due to continued focus on energy secu-
rity, enabling ESVAGT to renew long-term agreements at
improved terms and trade remaining vessels at high utiliza-
tion notably during 1st half of the year.
Significant efforts were directed towards managing costs in
an inflationary environment, both for our ongoing operations
and for investments as we continued to invest in the business
with a Capex spend of more than 400 million DKK in 2024.
Safety remains our top priority and while overall case
frequency in 2024 continued to be low, we regrettably
incurred an LTI (Lost Time Incident) due to a severe accident
involving one of our gangway operators. The injured person
“
ESVAGT ANNUAL REPORT 2024
7
BUSINESS PERFORMANCE
ESVAGT has more than 40 years of experience as a high-quality provider
of safety and support at sea and making the sea a safe place to work.
ESVAGT conduct our operations using our efficient Service Operation
Vessels (SOVs), serving the Offshore Wind industry, and our Emergency
Response and Rescue Vessels (ERRVs), which is servicing the drilling rigs
and production platforms in the Oil and Gas sector.
EXPECTATIONS FOR 2025
ESVAGT will continue to grow long-term, supported by its
existing contract backlog including new SOVs under construc-
tion, but expect for 2025 a broadly stable or potentially
slightly declining revenue and EBITDA performance due to
softness in the UK ERRV market and specific one-off events
before returning to growth again in 2026 and onwards
Wind
ESVAGT’s existing SOV fleet is primarily on long-term contracts
providing essential services to customers for the operations and
maintenance of windfarms. Two SOVs will be available for short/
medium-term employment in 2025, in a market that is expe-
riencing significant demand and high day-rates as there is a
shortage of quality tonnage for required walk-to-work services.
While the windfarm developers have experienced specific
project challenges in recent years leading to some delays and
cancellations, there is strong political resolve to progress on
the much-needed energy transition and the European pipe-
line of projects remains strong – and is slated to accelerate
substantially towards the 2030 targets regardless of whether
one expects these to be fully met or not.
The US is likely to go through a period of uncertainty, but
the long-term potential remains interesting. Meanwhile,
South Korea where ESVAGT is ready to participate via its Joint
Venture KESTO, is continuing to put in place the foundation
for a thriving offshore wind business.
ESVAGT ANNUAL REPORT 2024
8
ACTIVITY FOR 2024
Financial Results for the Year
The fiscal year 2024 resulted in a revenue of 1,470 million DKK,
an EBITDA of 509 million DKK, and a net profit of 39 million
DKK. The year finished with a total equity of 2,295 million DKK.
The revenue increased by 31.5 million DKK to 1,470 million
DKK in 2024 as both the Offshore Wind segment and the Oil
& Gas Segment saw revenue growth. The revenue improve-
ment in the Offshore Wind segment was driven by the high
performance of SOV’s on long-term contracts and the high
utilization of the short-term SOV operating at high market
rates, as there was a shortage of sufficient quality tonnage for
the required walk-to-work services. The revenue increase in
the Oil & Gas segment was driven by the high utilizations in
the core markets in Norway and Denmark, which continued to
focus on energy security.
Despite the ongoing macroeconomic pressures and geopo-
litical tensions in 2024, ESVAGT’s continued focus on rigorous
cost management and lower fuel prices, resulting in a 6.2 %
reduction in operating expenses in 2024.
In 2024, ESVAGT hired additional employees as required to
operate the first newly built vessel for Ørsted, and therefore
increased the staff expenses.
The strong revenue performance combined with diligent cost
focus ensured 2024 ended with an increased EBITDA of 11.7
million DKK.
The net financial items increased by 9.3 million, driven by the
volatile exchange rates and higher interest expenses for the
Oil and Gas
The broader Oil and Gas industry has fundamentally changed,
with an uptake in activity as Europe’s focus changed towards
energy security, as well as a growing realization that fossil
fuels will be required throughout the renewable transition.
As a result, we deem the outlook for ERRV services to be solid
(beyond the current UK market uncertainties) and ESVAGT will
play our role in helping societies and our customers through
the energy transitioning, by ensuring that fossil energy as long
as needed can be extracted as safely and environmentally
friendly as possible.
Strong operational
performance
0.40% Unplanned
breakdown – against KPI
of 0.85%
0.40%
ESVAGT ANNUAL REPORT 2024
9
future growth of newbuild SOV’s. As a result the net profit of
2024 of 39.2 million DKK, was below expectations for 2024
Overall ESVAGT achieved satisfactory results for the fiscal
year 2024, demonstrating resilience and effective strategic
execution.
Market and activities
In 2024 ESVAGT continued to maintain a high utilization of
both the ERRV and SOV fleet, supported by robust market
activity and excellent operational execution.
Wind
The wind activities continued their positive trend as several
offshore wind projects were underway, with additional devel-
opments announced for the coming years. In 2024, most of
the existing SOV fleet was engaged in long-term contracts,
demonstrating steady high performance. Meanwhile, for the
one SOV available for shorter-term operations, ESVAGT experi-
enced high demand to fill the market gap.
Oil and Gas
The North Sea ERRV market continued with good activity in
2024 in parts driven by the focus on energy security. ESVAGT
secured a high fleet utilization and was in addition able to
renew and extend existing contracts at higher rates.
Fleet development
The construction of three new SOVs for the European
market continued in 2024. Although the delivery of the first
of its kind methanol-powered SOV for Ørsted was initially
planned for late 2024, it has faced some delays and will
Saved lives since
early 1980s
149
ESVAGT ANNUAL REPORT 2024
10
now be delivered in 2025. The sister vessel for Ørsted and
the newbuild for Vestas are also progressing with planned
delivery in 2026.
Development activities
In 2024, ESVAGT incurred expenses of 2.3 million DKK (2023:
2.3 million DKK) primarily for IT and digitalization projects.
Financial risks
A consolidated overview of the ESVAGT Groups financial risks
is included in note 24.
Sustainability
Besides being an enabler of the Green Transition, ESVAGT’s
constantly endeavor to improve the sustainability of its oper-
ations. The delivery of the first SOV able to sail on e-methanol
in 2025 followed by a second in 2026 will be very significant
steps this regard.
Statutory statement regarding environment,
social issues and governance in accordance
with section 99a of the Danish Financial
Statements Act
For our statutory statement regarding the environment, social
issues and governance, we refer to our Sustainability Report
for 2024.
Statutory statement regarding policy on data
ethics in accordance with section 99d of the
Danish Financial Statements Act
For our statutory statement regarding the policy on data
ethics policy can be found here.
ESVAGT SUSTAINABILITY REPORT 2024
ESVAGT SUSTAINABILITY REPORT 2024
DECARBONISING
OFFSHORE
SUPPORT
CVR no. 60 69 88 13
Read our report here
ESVAGT ANNUAL REPORT 2024
11
KEY FIGURES FOR THE
CONSOLIDATED GROUP
5 YEARS KEY FIGURES
TDKK 2024 2023 2022 2021 2020
Profit and loss accounts
Net revenue 1,469,695 1,438,176 1,364,473 1,080,683 976,788
Profit before depreciation, amortization and
financial items 508,811 497,109 473,475 364,776 328,026
Net financials -171,054 -162,025 -205,993 -87,669 -84,112
Profit for the year 39,488 38,470 -16,159 150,709 -246,140
Balance sheet
Total assets 5,914,693 5,692,386 5,514,795 5,009,039 4,199,245
Total equity 2,295,196 2,261,371 2,277,111 2,150,584 1,752,137
Investment in property, plant and equipment 418,160 500,452 502,402 670,122 405,926
Key ratios
Profit margin % 14% 14% 14% 22% -17%
Return on equity % 2% 2% -1% 8% -14%
Equity ratio % 39% 40% 41% 43% 42%
The key figures and financial ratios have been prepared on a consolidated basis. The financial ratios have been calculated in accordance with the
recommendations of the Association of Danish Financial Analysts.
New build (US) Hull-793
New build (EU) Hull-1094 New build (EU) Hull-1097
New build (EU) Hull-1102
NEW BUILD VESSELS UNDER CONSTRUCTION
↑ Images for illustrative purposes only.
ESVAGT ANNUAL REPORT 2024
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Executive Management
Board of Directors
ESVAGT ANNUAL REPORT 2024
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ESVAGT ANNUAL REPORT 2024
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mne30141 mne32115
CVR No 33 77 12 31
ESVAGT ANNUAL REPORT 2024
16
GROUP PARENT
TDKK Note 2024 2023 2024 2023
Net revenue 3 1,469,695 1,438,176 1,466,659 1,434,458
Other income 3,031 1,973 3,031 1,973
Other operating expenses -403,142 -435,006 -404,950 -431,873
Gross profit 1,069,584 1,005,143 1,064,740 1,004,558
Staff expenses 4 -560,691 -507,950 -558,844 -505,996
Share of profit/loss in subsidiaries 0 0 -9,362 -8,235
Share of profit/loss in joint ventures 21 -82 -84 0 0
Profit before depreciation,
amortization and financial items etc. 508,811 497,109 496,534 490,327
Amortisation, depreciation and impairment
losses 5 -297,627 -296,935 -297,627 -296,935
Profit/loss before financial items 211,184 200,174 198,907 193,393
Financial income 6 3,499 4,976 15,089 11,831
Financial expenses 7 -174,553 -167,001 -174,673 -166,716
Profit/loss before income tax 40,130 38,149 39,323 38,507
Tax 8 -642 321 171 -31
Profit/loss for the year 39,488 38,470 39,494 38,476
Profit is attributable to:
Non-controlling interests -6 -6 0 0
Owners of ESVAGT A/S 39,494 38,476 39,494 38,476
GROUP PARENT
TDKK Note 2024 2023 2024 2023
Profit for the year 39,488 38,470 39,494 38,476
Other comprehensive income
Items that may be subsequently
reclassified to profit or loss
Exchange diff. on translation of subsidiaries -339 287 -339 287
Cash flow hedges:
Interest rate swaps -16,997 -50,826 -16,997 -50,826
Value adjustment of hedges for the year -3,365 -3,289 -3,365 -3,289
Reclassified to income statement
- revenue 1,468 -1,756 1,468 -1,756
- financial expenses 2,440 -3,264 2,440 -3,264
Other comprehensive income for the year,
net of tax -16,793 -58,848 -16,793 -58,848
Total comprehensive income for the year 22,695 -20,378 22,701 -20,372
Profit is attributable to:
Non-controlling interests -6 -6 0 0
Owners of ESVAGT A/S 22,701 -20,372 22,701 -20,372
STATEMENT OF COMPREHENSIVE INCOME
Consolidated and parent company financial statements
STATEMENT OF PROFIT AND LOSS
ESVAGT ANNUAL REPORT 2024
18
Assets
GROUP PARENT
TDKK Note 2024 2023 2024 2023
Development projects 4,199 3,287 4,199 3,287
Intangible assets 9 4,199 3,287 4,199 3,287
Vessels 10 4,026,677 4,138,722 4,026,677 4,138,722
Other operating equipment and fixtures 10 6,080 5,387 6,080 5,387
Buildings on leased land 10 31,152 32,748 31,152 32,748
Prepayments for tangible assets 10 867,798 609,495 867,798 609,495
Right-of-use assets 17 226,349 243,801 226,349 243,801
Tangible assets 5,158,056 5,030,153 5,158,056 5,030,153
Investment in subsidiaries 0 0 16,344 13,718
Investment in joint ventures 21 106,735 64,215 0 0
Receivables from joint ventures 212,529 127,825 0 0
Investments in other entities 319,264 192,040 16,344 13,718
Total non-current assets 5,481,519 5,225,480 5,178,599 5,047,158
Bunker oil and other consumables 12 13,757 18,260 13,757 18,260
Inventories 13,757 18,260 13,757 18,260
Trade receivables 13 193,408 218,654 160,997 159,490
Receivables from parent company 9,125 7,032 9,125 7,032
Receivables from Group companies 0 0 344,538 261,326
Derivatives and interest rate swaps 56,485 72,940 56,485 72,940
Other receivables 9,402 11,287 9,396 11,195
Prepayments 12,117 12,972 12,085 12,943
Deferred tax 15 0 349 0 0
Receivables 280,537 323,234 592,626 524,926
Cash and cash equivalents 138,880 125,412 130,135 103,114
Total current assets 433,174 466,906 736,518 646,300
Total assets 5,914,693 5,692,386 5,915,117 5,693,458
Liabilities
GROUP PARENT
TDKK Note 2024 2023 2024 2023
Share capital 14 2,200 2,200 2,200 2,200
Other reserves 55,082 71,876 59,281 75,164
Retained earnings 2,237,666 2,187,041 2,233,467 2,183,753
Equity attributable to owners of ESVAGT 2,294,948 2,261,117 2,295,948 2,261,117
Non-controlling interests 248 254 0 0
Total equity 2,295,196 2,261,371 2,295,948 2,261,117
Bank and credit institutions, non current 16 3,293,633 3,059,428 3,293,633 3,059,428
Lease liabilities, non current 17 88,083 136,139 88,083 136,139
Other non current liabilities 2,140 1,660 2,140 1,660
Total non-current liabilities 3,383,856 3,197,227 3,383,856 3,197,227
Bank and credit institutions, current 16 0 0 0 0
Lease liabilities, current 17 51,067 54,255 51,067 54,255
Received prepayments 5,998 8,587 5,998 8,587
Trade payables 77,600 77,370 77,225 77,248
Payables to Group companies 0 0 1,221 1,259
Income tax liabilities 638 454 553 724
Other payables 100,338 93,122 100,249 93,041
Total current liabilities 235,641 233,788 236,313 235,114
Total liabilities 3,619,497 3,431,015 3,620,169 3,432,341
Total equity and liabilities 5,914,693 5,692,386 5,915,117 5,693,458
Consolidated and parent company financial statements
STATEMENT OF FINANCIAL POSITION
ESVAGT ANNUAL REPORT 2024
19
GROUP
TDKK Share Capital
Reserve for Foreign
Currency Translation
Cash Flow
Hedges
Retained
Earnings Total
Non-Controlling
Interests Total Equity
Equity at 01.01.2023 2,200 -1,350 132,074 2,143,928 2,276,852 260 2,277,112
Profit for the year 0 0 0 38,476 38,476 -6 38,470
Exchange diff. on translation of subsidiaries 0 287 0 0 287 0 287
Interest rate swaps 0 0 -50,826 0 -50,826 0 -50,826
Value adjustment of hedges for the year 0 0 -3,289 0 -3,289 0 -3,289
Reclassified to income statement
- revenue 0 0 -1,756 0 -1,756 0 -1,756
- financial expenses 0 0 -3,264 0 -3,264 0 -3,264
Total comprehensive income for the year 0 287 -59,135 38,476 -20,372 -6 -20,378
Transactions with owners in their capacity as owners
Long term incentive schemes 0 0 0 4,637 4,637 0 4,637
Equity at 31.12.2023 2,200 -1,063 72,939 2,187,041 2,261,117 254 2,261,371
Profit for the year 0 0 0 39,494 39,494 -6 39,488
Exchange diff. on translation of subsidiaries 0 -339 0 0 -339 0 -339
Interest rate swaps 0 0 -16,997 0 -16,997 0 -16,997
Value adjustment of hedges for the year 0 0 -3,365 0 -3,365 0 -3,365
Reclassified to income statement
- revenue 0 0 1,468 0 1,468 0 1,468
- financial expenses 0 0 2,440 0 2,440 0 2,440
Total comprehensive income for the year 0 -339 -16,454 39,494 22,701 -6 22,695
Transactions with owners in their capacity as owners
Calculated value of LTIP at time of severance 0 0 0 6,647 6,647 0 6,647
Long term incentive schemes 0 0 0 4,483 4,483 0 4,483
Equity at 31.12.2024 2,200 -1,402 56,485 2,237,665 2,294,948 248 2,295,196
Consolidated and parent company financial statements
STATEMENT OF CHANGES IN EQUITY
ESVAGT ANNUAL REPORT 2024
20
PARENT
TDKK Share Capital
Reserve for Foreign
Currency Translation
Cash Flow
Hedges
Development
Cost Reserve
Retained
Earnings Total Equity
Equity at 01.01.2023 2,200 -1,350 132,074 5,754 2,138,174 2,276,852
Profit for the year 0 0 0 -2,466 40,942 38,476
Exchange diff. on translation of subsidiaries 0 287 0 0 0 287
Interest rate swaps 0 0 -50,826 0 0 -50,826
Value adjustment of hedges for the year 0 0 -3,289 0 0 -3,289
Reclassified to income statement
- revenue 0 0 -1,756 0 0 -1,756
- financial expenses 0 0 -3,264 0 0 -3,264
Total comprehensive income for the year 0 287 -59,135 -2,466 40,942 -20,372
Transactions with owners in their capacity as owners
Long term incentive schemes 0 0 0 0 4,637 4,637
Equity at 31.12.2023 2,200 -1,063 72,939 3,287 2,183,753 2,261,117
Profit for the year 0 0 0 911 38,583 39,494
Exchange diff. on translation of subsidiaries 0 -339 0 0 0 -339
Interest rate swaps 0 0 -16,997 0 0 -16,997
Value adjustment of hedges for the year 0 0 -3,365 0 0 -3,365
Reclassified to income statement
- revenue 0 0 1,468 0 0 1,468
- financial expenses 0 0 2,440 0 0 2,440
Total comprehensive income for the year 0 -339 -16,454 911 38,583 22,701
Transactions with owners in their capacity as owners
Calculated value of LTIP at time of severance 0 0 0 0 6,647 6,647
Long term incentive schemes 0 0 0 0 4,483 4,483
Equity at 31.12.2024 2,200 -1,402 56,485 4,199 2,233,466 2,294,948
Consolidated and parent company financial statements
STATEMENT OF CHANGES IN EQUITY
ESVAGT ANNUAL REPORT 2024
21
GROUP PARENT
TDKK Note 2024 2023 2024 2023
Profit before depreciation, amortisation
and financial items etc. 508,811 497,109 496,534 490,327
Other expenses -1,522 2,380 -1,522 5,503
Longterm incentive schemes 4,483 4,637 4,483 4,637
Calculated value of LTIP at time of severance 6,647 0 6,647 0
Change in working capital 23 34,921 -14,662 7,824 -24,361
Share of profit/loss in subsidiaries 0 0 9,362 8,235
Share of profit/loss in joint ventures 82 84 0 0
Cash flows from operating activities before
financial income and expenses 553,422 489,548 523,328 484,341
Financial income received 3,499 4,969 15,089 11,825
Financial expenses paid -191,798 -143,140 -191,943 -143,446
Income taxes paid -76 -345 0 0
Net cash flow from operating activities 365,047 351,032 346,474 352,720
GROUP PARENT
TDKK Note 2024 2023 2024 2023
Payments for intangible assets and property,
plant and equipment -397,595 -493,343 -397,595 -493,343
Sale of intangible assets and property, plant
and equipment 1,522 0 1,522 0
Share capital in joint ventures -42,520 -64,215 0 -26
Loan to subsidiaries 0 0 -83,212 -143,369
Loan to joint ventures -84,704 -127,825 0 0
Net cash flow from investing activities -523,297 -685,383 -479,285 -636,738
Proceeds from loans from credit institutions 210,016 200,038 210,016 200,038
Principle element of lease payments -54,777 -51,169 -54,777 -51,169
Cash flow from financing activities 155,239 148,869 155,239 148,869
Net cash flow for the year -3,011 -185,482 22,428 -135,149
Effects of exchange rate changes on cash and
cash equivalents 16,479 -7,052 4,593 -6,328
Cash and cash equivalents, beginning of the year 125,412 317,946 103,114 231,935
Cash and cash equivalents, end of the year 138,880 125,412 130,135 103,114
Consolidated and parent company financial statements
CASH FLOW STATEMENT
ESVAGT ANNUAL REPORT 2024
22
1. Accounting policies
2. Critical accounting estimates and judgements
3. Revenue
4. Staff expenses
5. Amortization, depreciation and impairment losses
6. Financial income
7. Financial expenses
8. Tax
9. Intangible assets
10. Property, plant and equipment
11. Financial assets and liabilities
12. Inventories
13. Trade receivables
14. Share capital
15. Deferred tax
16. Bank and credit institutions
INDEX OF NOTES
17. Leasing
18. Fee to the statutory auditors
19. Derivative financial instruments
20. Related parties
21. Investment in joint ventures
22. Contingent liabilities
23. Cash flow statement
24. Financial risk management
25. Events after the balance sheet date
26. Composition of the group
ESVAGT ANNUAL REPORT 2024
23
The Annual Report for the period 1 January - 31 December 2024 comprise the consolidated financial statement of the
parent company ESVAGT A/S and subsidiaries controlled by the parent company (the group) and the separate finan-
cial statements of the parent company and have been prepared in accordance with the IFRS Accounting Standards
as adopted by the EU and further requirements in the Danish Financial Statements Act. The annual report has been
approved by the Board of Directors at its meeting on 24 April 2025.
The annual report will be presented to the shareholders of ESVAGT A/S for approval at the annual General Meeting.
Measurement basis
The consolidated and separate financial statements have been prepared on the historical cost basis except for deriva-
tive financial instruments which are measured at fair value.
New and amended standards adopted by the group
The group has applied the following standards and amendments for the first time for their annual reporting period
commencing 1 January 2024:
• Classification of Liabilities as Current or Non-Current - Amendments to IAS 1
• Lease Liability in a Sale and Leaseback – Amendments to IFRS 16
• Non-current Liabilities with Covenants - Amendments to IAS 1
The amendments listed above did not have any material impact on the amounts recognized in prior periods and are
not expected to significantly affect the current or future periods.
New standards and interpretations not yet adopted
Certain new accounting standard and interpretations have been published that are not mandatory for 31 December
2024 reporting periods and have not been early adopted by the group. These standards are not expected to have a
material impact on the group in the current or future periods and on foreseeable transactions.
Basis of consolidation
Subsidiaries are all entities over which the group has control. The group controls an entity when the group is exposed
to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns
through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which
control is transferred to the group. They are deconsolidated from the date that control ceases.
Consolidation is performed by summarizing the financial statements of the parent company and its subsidiaries which
have been prepared in accordance with ESVAGT A/S accounting policies. On consolidation, elimination is made of
intra-group income and costs, shareholdings, intra-group balances and dividend and realized and unrealized profits or
losses on transactions between the consolidated companies.
Non-controlling interests’ share of profit/loss for the year and of equity in subsidiaries are included as part of ESVAGT
A/S profit and equity respectively but shown as separate items.
Foreign currency translation
Functional and presentation currency
Items in the financial statements of each of the reporting companies of the Group are measured in the currency of the
primary economic environment in which the company operates (the functional currency).
The functional currency of the Parent company, ESVAGT A/S is DKK.
The financial statements are presented in Danish Kroner (DKK). The financial statements have been rounded to the
nearest thousand.
Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the trans-
lation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are generally
recognized in profit or loss.
Foreign exchange gains and losses that relate to borrowings are presented in the statement of profit or loss, within
finance costs. All other foreign exchange gains and losses are presented in the statement of profit or loss on a net basis
within other income or other expenses.
Group companies
The results and financial position of all the group entities that have a functional currency different from the presenta-
tion currency are translated into the presentation currency as follows:
a. Assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance
sheet.
Note 1
ACCOUNTING POLICIES
ESVAGT ANNUAL REPORT 2024
24
b. Income and expenses for each income statement are translated at average exchange rates; and
c. All resulting exchange differences are recognized in other comprehensive income.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of
the foreign entity and translated at the closing rate. Exchange differences arising are recognized in other comprehen-
sive income.
Derivatives
Derivatives are initially recognized at fair value on the date a derivative contract is entered and are subsequently
re-measured at their fair value. The method of recognizing the resulting gain or loss depends on whether the derivative
is designated as a hedging instrument, and if so, the nature of the item being hedged. Foreign exchange forwards are
used to hedge the currency risk related to recognized and unrecognized transactions.
The effective portion of changes in the value of derivative financial instruments designated to hedge future transac-
tions is recognized under equity until the hedged transactions are realized. At that time, the cumulated gains/losses
are transferred to the items under which the hedged transactions are recognized. The effective portion of changes in
the value of derivative financial instruments used to hedge the value of the recognized financial assets and liabilities is
recognized in the income statement together with changes in the fair value of the hedged assets or liabilities which can
be attributed to the hedging relationship. The ineffective portion of hedge transaction are recognized in the income
statement as financial income or expenses for interest and currency-based instruments.
Revenue recognition
ESVAGT provides support and services (ERRV and SOV) to the offshore industry comprising standby and emergency
response and rescue, oil spill contingency, tanker assist, rig move and supply duties. Revenue from providing services
is recognized in the accounting period in which the services are rendered. Revenue is recognized based on the actual
service provided to the end of the reporting period as a proportion of the total services to be provided because the
customer receives and uses the benefits simultaneously. This is determined based on the days spent relative to the
total number of days the contract covers. Furthermore, the group recognizes revenue for it’s long-term contracts in a
amount to which the group has a right to invoice.
Support and service contracts include multiple deliverables, such as charter, crew, fuel and services. Except for fuel,
the deliverables are integrated in the services and cannot be provided separately. The services in a charter excluding
fuel are therefore accounted for as one performance obligation. A part of the contract price is allocated to a separate
performance obligation for fuel based on its stand-alone selling price, which is directly observable.
The contracts do not contain any variable elements.
Other income
Other income comprises of other activities, e.g. property rent and gains/losses of sales of fixed assets. Other income is
recognized when the agreed service or asset is delivered, and the control has been transferred to the purchaser.
External expenses
External expenses comprise repair and maintenance, stores, vessel fuel, training and travel costs, expenses related to
marketing, administration, office expenses, bad debt etc.
Staff expenses including pensions and similar liabilities
Staff expenses comprise wages and salaries, pensions, social security costs and other staff costs to the company’s
employees.
ESVAGT A/S has entered into pension and similar agreements with most employees. Obligations relating to defined
contribution plans are recognized in the income statement in the period in which they are earned.
Long-term incentive schemes granted to the Executive Management and other senior employees are recognised as
staff expenses and offset directly against equity as they are assessed to be share based programs for the company.
Amortization, depreciation and impairment
Amortization, depreciation and impairment comprise amortization, depreciation and impairment of intangible assets,
property, plant and equipment and right-of-use assets.
Financial income and expenses
Financial income and expenses comprise interest income and expenses based on the effective interest rate method,
realized and non-realized capital gains/losses on transactions in foreign currency, amortization of financial assets and
liabilities etc.
Note 1 – continued
ACCOUNTING POLICIES
ESVAGT ANNUAL REPORT 2024
25
Income tax and deferred tax
The income tax expense or credit for the period is the tax payable on the current period’s taxable income adjusted by
changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.
The current income tax charge is calculated based on the tax laws enacted or substantively enacted at the balance
sheet date in the countries where the Company and its subsidiaries operate and generate taxable income.
Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax
regulation is subject to interpretation. It establishes provisions, where appropriate, based on amounts expected to be
paid to the tax authorities.
ESVAGT’s vessels activities are subject to the tonnage taxation scheme under which the computation of taxable income
includes an amount, calculated based on the fleet’s tonnage.
Deferred income tax is recognized on temporary differences arising between the tax bases of assets and liabilities and
their carrying amounts in the Consolidated Financial Statements. However, deferred tax liabilities are not recognized if
they arise from the initial recognition of goodwill; deferred income tax is not accounted for if it arises from the initial
recognition of an asset or liability in a transaction other than a business combination that, at the time of the transac-
tion, affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws)
that have been enacted or substantively enacted by the balance sheet date and are expected to apply when the related
deferred income tax asset is realized, or the deferred income tax liability is settled.
Deferred income tax assets are recognized only to the extent that it is probable that future taxable profit will be avail-
able, against which the temporary differences can be utilized.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets
against current tax liabilities and when the deferred income tax assets and liabilities relate to income taxes levied by
the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to
settle the balances on a net basis.
Intangible assets
Development projects
Development projects comprise costs related to specific development projects. Development projects are capitalized
when development projects imply a technical and/or operational advantage for ESVAGT and where the financial net
present value of these projects exceeds the development expenses.
Intangible assets are measured at cost less of accumulated amortization and impairment losses.
Amortization is recognized in the income statement on a straight-line basis over the useful life, which is:
• Development projects: 3 years
Tangible assets
Premises on leased land, vessels, docking costs and other operating equipment and fixtures are measured at cost less
accumulated depreciation and accumulated impairment losses.
Cost comprise the cost of acquisition and expenses directly related to the acquisition up until the time when the
asset is ready for use. Borrowing costs from specific as well as general borrowing directly related to assets with a long
production period are attributed to costs during the period of construction.
Depreciation based on cost reduced by any residual value is calculated on a straight-line basis over the expected useful
lives of the assets, which are:
• Premises on leased land: 20-30 years
• Vessels: Up to 35 years
• Docking costs: 2.5-5 years
• Other fixtures and fittings: 3-5 years
New build vessels are depreciated over 25-35 years. Used vessels are depreciated over a shorter period based on the
vessel age upon time of purchase. Charter contracts related upgrades and other improvements are depreciated over
expected useful life of 3-5 years.
Expenses for docking of vessels are recognized when incurred in the carrying amount of vessels and depreciated over
the period until next docking.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting
period.
Note 1 – continued
ACCOUNTING POLICIES
ESVAGT ANNUAL REPORT 2024
26
Gains and losses arising from disposal of tangible assets are calculated as the difference between the sales price less
sales costs and the carrying amount at the time of sale. Gains and losses are recognized in the profit and loss account
as other operating income or other operating costs.
Impairment of non-financial assets
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is
greater than its estimated recoverable amount. An impairment loss is recognized in the income statement when the
impairment is identified.
Intangible assets that have an indefinite useful life and intangible assets not yet available for use are not subject to
amortization and are tested annually for impairment. Tangible and intangible assets that are subject to amortization are
reviewed whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An
impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount.
The recoverable amount is the higher of an asset’s fair value less cost of disposal and value in use. For the purposes
of assessing impairment, assets are grouped at the lowest levels for which there are largely independent cash inflows
(cash-generating units). Prior impairment of non-financial assets (other than goodwill) are reviewed for possible
reversal at each reporting date.
Leases
Leases are recognized as a right-of-use asset and a corresponding liability at the date which the leased asset is avail-
able for use by the group.
Assets and liabilities arising from a lease are initially measured at present value of the lease payments. The lease
payments include among other fixed payments and variable lease payments that are based on an index or a rate. Lease
payments to be made under reasonably certain extension options are also included in the measurement of the liability.
Contracts may contain both lease and non-lease components. For all leases, the group has elected not to separate the
lease and non-lease components and instead accounts for these as a single component.
The lease payments are discounted using the interest rate implicit in the lease. If that rate is not readily determinable,
the incremental borrowing rate is used.
Lease payments are allocated between principal and finance cost. The finance cost is charged to the income statement
over the lease period 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 comprising the amount of the initial measurement of the lease liability, any
lease payments made at or before the commencement date, any initial direct costs and restoration costs.
Right-of-use assets are depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis.
Variable lease payments that do not depend on an index or a rate and payments associated with leases with a lease
term of 12 months or less and low-value assets are recognized as an expense in the income statement, included in
other operating expenses.
As a practical expedient, a lessee may elect not to assess whether a Covid-19 pandemic-related rent concession from
a lessor is a lease modification. ESVAGT applies the IASB amendments to IFRS 16 in regard to rent concessions that
simplify how lessee accounts for rent concessions that are direct consequence of Covid-19 and where all conditions of
the practical expedient are met.
Investment in subsidiaries and joint ventures
Investments in subsidiaries
Investments in subsidiaries are in the separate financial statements of the parent company recognized according to the
equity method (see below) after initially being measured at cost.
Investment in joint ventures
IFRS requires investments in joint arrangements to be classified as either joint operations or joint ventures. The classi-
fication depends on the contractual rights and obligations of each investor, rather than the legal structure of the joint
arrangement. All investments over which the group has joint control are classified as joint ventures.
Interests in joint ventures are accounted for using the equity method (see below), after initially being recognized at
cost.
Note 1 – continued
ACCOUNTING POLICIES
ESVAGT ANNUAL REPORT 2024
27
Applying the equity method
Under the equity method, the investments are initially recognized at cost and adjusted thereafter to recognize the
group’s share of the post-acquisition profits or losses of the investee in profit or loss, and the group’s share of move-
ments in other comprehensive income of the investee. Dividends received or receivable from subsidiaries (separate
financial statements of ESVAGT A/S only) and joint ventures are recognized as a reduction in the carrying amount of
the investment.
Where the group’s share of losses in an equity-accounted investment equals or exceeds its interest in the entity,
including any other unsecured long-term receivables, the group does not recognize further losses, unless it has
incurred obligations or made payments on behalf of the other entity.
Unrealized gains on transactions with joint ventures are eliminated to the extent of the group’s interest in these enti-
ties. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset trans-
ferred. Accounting policies of equity-accounted investees have been changed where necessary to ensure consistency
with the policies adopted by the group.
The carrying amount of equity-accounted investments is tested for impairment in accordance with the policy described
above.
Inventories
Inventories comprise of bunkers and other consumables. Inventories are measured at cost according to the FIFO-
method. Write-down is made to a possibly lower net realizable value.
Receivables
Receivables are initially recognized at fair value adjusted for any transaction costs. Subsequently, receivables are
measured at amortized cost, which usually corresponds to the nominal value.
The group applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected
loss allowance for all trade receivables and contract assets.
To measure the expected credit losses, trade receivables and contract assets have been grouped based on shared
credit risk characteristics and the days past due. The contract assets relate to unbilled work in progress and have
substantially the same risk characteristics as the trade receivables for the same types of contracts. The group has
therefore concluded that the expected loss rates for trade receivables are a reasonable approximation of the loss rates
for the contract assets.
The expected loss rates are based on the payment profiles of historic sales and the corresponding historical credit
losses. The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic
factors affecting the ability of the customers to settle the receivables. The group has identified the GBP and the oil
and energy prices to be the most relevant factors, and accordingly adjusts the historical loss rates based on expected
changes in these factors.
Prepayments
Prepayments comprise various prepaid expenses such as prepaid insurance, subscriptions etc. Prepayments are
measured at cost.
Cash and cash equivalents
Cash and cash equivalents comprise “Cash at bank and in hand”.
Equity
Reserve for foreign currency translation
The reserve for exchange adjustments consists of exchange rate differences that occur when translating the foreign
subsidiaries financial statements from their functional currency into the Group’s presentation currency. On disposal of
the net investment, the reserve for exchange adjustments of that foreign subsidiary is recognized in the income state-
ment. Reduction of a net investment in a foreign operation which does not result in loss of control is not treated as a
disposal.
Cash flow hedges
The effective portion of changes in the value of derivative financial instruments designated to hedge future transac-
tions is recognized under equity until the hedged transactions are realized.
Dividend distribution
Dividends are recognized as a liability in the period in which they are adopted at the Annual General Meeting.
Note 1 – continued
ACCOUNTING POLICIES
ESVAGT ANNUAL REPORT 2024
28
Note 1 – continued
ACCOUNTING POLICIES
Development cost reserve
An amount equal to the total capitalized development costs after tax is recognized in equity in the Development cost
reserve.
Bank and Credit institutions
Borrowings from credit institutions are initially recognized at fair value, net of transaction expenses incurred.
Borrowings from credit institutions are subsequently measured at amortized cost. Any differences between the
proceeds and the redemption value are recognized in the income statement over the period of the borrowings using
the effective interest method.
Prepayments received from customers
Prepayments received from customers comprise amounts received from customers prior to delivery of the goods
agreed or completion of the service agreed.
Other liabilities
Other debt or liabilities covering trade payables and other debt are recognized at amortized cost, which is usually
equivalent to the nominal value.
Statement of cash flow
The cash flow statement shows the Group’s cash flows during the year distributed on operating, investing and
financing activities, changes in cash and cash equivalents at the beginning and at the end of the year.
Cash flows from operating activities are calculated by the indirect method using the profit before depreciation adjusted
for changes in working capital and non-cash operating items such as depreciation, amortization and impairment losses,
and provisions. Working capital comprises current assets less short-term debt excluding items included in cash and
cash equivalents.
Cash flows from investing activities comprise cash flows from acquisitions and disposals of intangible assets, property,
plant and equipment as well as fixed asset investments and loans to joint ventures and subsidiaries.
Cash flows from financing activities comprise cash flows from the raising and repayment of long-term debt, payment of
principal element of leases as well as payments to and from shareholders.
Consolidated Key Figures
The key figures and financial ratios have been prepared on a consolidated basis. The financial ratios have been calcu-
lated in accordance with the recommendations of the Association of Danish Financial Analysts (2015).
Parent company’s policy to account for mergers
Mergers between the parent company and its subsidiaries are accounted for by applying predecessor accounting.
Hereby the parent company recognizes the assets and liabilities received at their values as included in the consolidated
financial statements of the Group. Comparative figures are restated accordingly. The full-year results and cash flows of
the merged subsidiaries (including comparative figures) are included in the parent company’s income statement and
cash flow statement.
ESVAGT ANNUAL REPORT 2024
29
The group performs certain judgements and estimates concerning the future.
The estimates are performed based on historical experience and other factors that Management considers to be reli-
able, but which by their very nature are associated with uncertainty and unpredictability. These assumptions may prove
incomplete or incorrect, and unexpected events or circumstances may arise. The Group is also subject to risks and
uncertainties that may lead to actual results differing from these estimates, both positively and negatively.
The judgement and estimates that have a significant risk of causing a material adjustment to the carrying amounts of
assets and liabilities within the next financial year are addressed below.
Judgements
Determination of cash generating units
Judgement is applied in determining the cash generating units (CGU’s). Management has based on the specific capa-
bilities of the vessels, split these into three CGU’s;
• Group 1: multi-role ERRV vessels are flexible and support the offshore oil & gas industry with a number of highly
specialized services as a supplement to the ERRV functions: Anchor handling; Rig moves; Emergency towing; Cargo
runs; ROV inspections and surveys; Barge work; Oil spill response and Fire-Fighting.
• Group 2/3: high-end fleet of ERRV vessels in Group 2 are all designed to operate worldwide and in harsh environments.
They comply with all stand-by regulations in DK, UK, NL and NO. The vessels are optimized on fuel consumption,
capacity and size. Group 3 vessels are the pioneers of the ESVAGT fleet. They are particularly seaworthy and completely
solid. Some of the vessels have already been upgraded with a number of welfare and technical improvements. They are
approved to stand-by / ERRV duties in the Danish sector.
• Wind: Service Operation Vessels (SOV) are the cost-efficient choice for windfarms far from shore. The SOV offers
onboard workshop, spare parts storage, crane and office facilities. Advanced transfer of technicians and spare parts to
WTGs by ESVAGT Safe Transfer Boat or W2W gangway solutions.
This also reflect how Management monitors the operations.
Management furthermore applies its judgement in allocating assets that do not generate independent cash flows to
appropriate CGU’s.
Estimates
Useful life and residual values
The vessels are estimated to operate up to 35 years before they are taken out of the fleet. Some vessels operate longer
than that, and the depreciations are calculated individually when the useful lives and residual values are reviewed and
adjusted if appropriate, at the end of each year.
Impairment testing
Impairment testing is performed for each cash-generating unit as defined by our operational structure as described
under judgement, if indicators of impairment exists.
For the impairment testing, a number of estimates are made regarding the expected development in day rates, utiliza-
tion of vessels, future capital expenditures, discount rates, which are all included in the projected cash flows applied for
the impairment testing.
These estimates are based on an assessment of current and future developments in the three cash-generating units
and on historical data and future assumptions. Various market insights used by each stakeholder to estimate the devel-
opment in revenue and cost drivers for each segment and responsibility area.
The assumptions included in the value-in-use calculation are based on financial budgets and business plans approved
by management.
ESVAGTs business model proven to be resistant to the volatile macroeconomic effects and market conditions, with high
inflation, interest rates and falling NOK FX rates, Despite volatile spot market rates, in especially Oil and Gas sector, it’s
shown over time to keep up with inflation. Our long-term contracts also incorporated with escalation principles linked
to relevant indexes, to cover years with higher inflation. Thereby no impairment seen in the different CGU’s and the
result of the impairment testing is further disclosed in note 11 about Property, Plant and Equipment.
Note 2
CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
ESVAGT ANNUAL REPORT 2024
30
GROUP PARENT
TDKK 2024 2023 2024 2023
Support and safety activities, offshore oil & gas (over time) 833,869 824,045 830,834 820,335
Support and safety activities, offshore wind (over time) 560,054 538,618 560,054 538,618
Sale of fuel, offshore oil & gas (point in time) 41,705 46,024 41,704 46,017
Sale of fuel, offshore wind (point in time) 34,067 29,489 34,067 29,488
1,469,695 1,438,176 1,466,659 1,434,458
The group has recognized the following assets and liabilities related to contracts with customers:
TDKK
31 Dec
2024
31 Dec
2023
1 Jan
2023
Group
Current contract assets relating to charters 464 329 280
Current contract liabilities relating to charters -5,998 -8,587 -11,164
Parent
Current contract assets relating to charters 464 329 280
Current contract liabilities relating to charters -5,998 -8,587 -11,164
GROUP PARENT
TDKK 2024 2023 2024 2023
Revenue recognised that was included in the contract liability
at the beginning of the period 2,589 2,577 2,589 2,577
The group has taken the practical expedient in IFRS 15 not to disclose information about the aggregate amount of the
transaction price allocated to its remaining performance obligations, as the group’s contracts either has an original
expected duration of one year or less; or as the group for its long-term contracts recognizes revenue in an amount to
which the group has a right to invoice.
The invoicing is done on a monthly basis reflecting the contracted day rate and the actuals days per month. Normal
payment terms are running month +30 days or 45 days.
Note 3
REVENUE
ESVAGT ANNUAL REPORT 2024
31
GROUP PARENT
TDKK 2024 2023 2024 2023
Wages and salaries 510,403 469,268 508,602 467,411
Pensions, defined contribution plans 27,898 24,582 27,871 24,500
Other staff costs 11,260 9,463 11,241 9,448
Calculated value of LTIP at time of severance 6,647 0 6,647 0
Long term incentive schemes 4,483 4,637 4,483 4,637
Staff Expenses 560,691 507,950 558,844 505,996
Average number of full-time employees 1,064 995 1,062 993
Management Compensation
The Executive Management compensation for 2024 has been significantly impacted by the exit of the former CEO.
Management includes Board of Directors and Executive Management in ESVAGT A/S, in total 6 persons by end 2024 (6
in 2023). Compensation 2024 includes wages, pensions, one-offs, calculated value of LTIP at time of severance and long
term incentive schemes.
Long term incentive schemes
The Executive Management and other senior employees of ESVAGT have been granted 2 Long Term Incentive Schemes
(the LTIP programs), which are structured according to the same principles, but depend on different triggering events.
The participants will therefore only get payment from one of the LTIP programs when vested.
Both programs depend on the fair value development of ESVAGT A/S and an exit of the current owners. The maximum
value of the programs amounts to DKK 112 million (EUR 15 million), however the value recognized is based on a value
of DKK 42 million corresponding to the estimated value at grant date.
The program vests over the period until an exit of the current owners. In 2024 DKK 4,5 million has been recognized as
an expense in the P&L.
The exercise price of the awards is 0.
The compensation paid or payables to key management for employee services is shown below:
TDKK
Executive
Management
Board of
Directors Total
2024 Group
Wages and salaries (incl. one-offs) 18,621 2,127 20,748
Pensions, defined contribution plans 312 0 312
Calculated value of LTIP at time of severance
6,647 0 6,647
Long term incentive schemes 1,693 0 1,693
Compensation to the Board of Directors and Executive Management 27,273 2,127 29,400
2024 Parent
Wages and salaries (incl. one-offs) 18,621 2,127 20,748
Pensions, defined contribution plans 312 0 312
Calculated value of LTIP at time of severance 6,647 0 6,647
Long term incentive schemes 1,693 0 1,693
Compensation to the Board of Directors and Executive Management 27,273 2,127 29,400
TDKK
Executive
Management
Board of
Directors Total
2023 Group
Wages and salaries 10,606 2,070 12,676
Pensions, defined contribution plans 251 0 251
Long term incentive schemes 1,716 0 1,716
Compensation to the Board of Directors and Executive Management 12,573 2,070 14,643
2023 Parent
Wages and salaries 10,606 2,070 12,676
Pensions, defined contribution plans 251 0 251
Long term incentive schemes 1,716 0 1,716
Compensation to the Board of Directors and Executive Management 12,573 2,070 14,643
Note 4
STAFF EXPENSES
ESVAGT ANNUAL REPORT 2024
32
Note 7
FINANCIAL EXPENSES
GROUP PARENT
TDKK 2024 2023 2024 2023
Interest expenses to subsidaires 0 0 122 105
Interest expenses, credit institutions 165,810 137,909 165,855 137,909
Interest expenses, leases 14,537 18,205 14,537 18,205
Exchange rate adjustments 20,167 23,576 20,141 23,318
Other financial expenses, including bank fees 215 491 194 359
Capitalized interests -26,176 -13,180 -26,176 -13,180
174,553 167,001 174,673 166,716
Total interest expenses on financial liabilities not measured at fair value through profit or loss for the year was TDKK
180,347 (2023: TDKK 156,114) for the group and TDKK 180,392 (2023: TDKK 156,219) for the parent company.
Note 5
AMORTIZATION AND DEPRECIATION
GROUP PARENT
TDKK 2024 2023 2024 2023
Amortisation of intangible assets 3,111 3,304 3,111 3,304
Depreciation of tangible assets 270,699 271,898 270,699 271,898
Depreciation of right-of-use assets 23,817 21,733 23,817 21,733
297,627 296,935 297,627 296,935
Note 6
FINANCIAL INCOME
GROUP PARENT
TDKK 2024 2023 2024 2023
Interest income from parent 359 348 359 348
Interest income from subsidiaries 0 0 11,590 7,765
Interest income, bank 3,140 4,621 3,140 3,712
Exchange rate adjustments 0 0 0 0
Other financial Income 0 7 0 6
3,499 4,976 15,089 11,831
Total interest income on financial assets that are measured at amortized cost for the year was TDKK 3,499 (2023: TDKK
4,975) for the Group and TDKK 15,089 (2023: TDKK 11,831) for the parent company.
ESVAGT ANNUAL REPORT 2024
33
GROUP PARENT
TDKK 2024 2023 2024 2023
Income tax:
Tax on profit/loss for the year 89 -1,045 -724 -693
Total income tax 89 -1,045 -724 -693
Tonnage tax 553 724 553 724
Total tax for the year 642 -321 -171 31
Tax on profit/loss for the year can be broken down as follows:
Current tax 446 0 0 0
Deferred tax 367 -352 0 0
Adjustments for current tax of prior periods -724 -693 -724 -693
Tax on profit/loss for the year 89 -1,045 -724 -693
Income tax is specified as follows:
Calculated 22% tax on "Profit for the year
before income tax" -8,829 -9,519 -8,651 -9,492
Tax effects of:
Income tax under tonnage taxation 9,382 9,167 9,204 9,492
Adjustments in respect of prior years -724 -693 -724 -693
89 -1,045 -724 -693
Effective tax rate -0.2% 2.4% 1.8% 1.6%
The majority of the Group’s taxable income is located in Denmark, and therefore the majority of the tax base is subject
to Danish tax legislation. As such, the ESVAGT Group has elected to participate in the Danish Tonnage Tax scheme; the
participation is binding until 31 December 2031.
Deferred tax relates to tangible fixed assets not covered by tonnage taxation activities.
GROUP PARENT
TDKK
Development
Projects
Development
Projects
Cost:
At 01.01.2023 21,195 21,195
Additions during the year 2,334 2,334
Disposals 0 0
Reclassifications -1,497 -1,497
At 31.12.2023 22,032 22,032
Amortisation and impairment:
At 01.01.2023 15,441 15,441
Amortisation charge 3,304 3,304
Disposals 0 0
At 31.12.2023 18,745 18,745
Carrying amount 31.12.2023 3,287 3,287
Cost:
At 01.01.2024 22,032 22,032
Additions during the year 2,257 2,257
Disposals -864 -864
Reclassifications 1,766 1,766
At 31.12.2024 25,191 25,191
Amortisation and impairment:
At 01.01.2024 18,745 18,745
Amortisation charge 3,111 3,111
Disposals -864 -864
At 31.12.2024 20,992 20,992
Carrying amount 31.12.2024 4,199 4,199
During 2024 ESVAGT held expenses of MDKK 0 (2023: MDKK 0) mainly relating to IT projects.
Note 8
TAX
Note 9
INTANGIBLE ASSETS
ESVAGT ANNUAL REPORT 2024
34
GROUP
TDKK Vessels
Operating
Equipment
& Fixtures Buildings
Prepay-
ments Total
Cost:
At 01.01.2023 6,765,423 45,215 62,679 199,396 7,072,713
Adjustment to prior year 0 0 0 0 0
Additions during the year 77,140 5,380 0 417,931 500,451
Disposals 0 0 0 0 0
Reclasssifications 6,035 -10,490 50 -7,831 -12,236
At 31.12.2023 6,848,598 40,105 62,729 609,496 7,560,928
Depreciation and impairment:
At 01.01.2023 2,453,445 33,231 27,565 0 2,514,241
Adjustment to prior year 0 0 0 0 0
Disposals 0 0 0 0 0
Depreciation 268,028 1,454 2,416 0 271,898
Reclassifications -11,597 33 0 1 -11,563
At 31.12.2023 2,709,876 34,718 29,981 1 2,774,576
Carrying amount 31.12.2023 4,138,722 5,387 32,748 609,495 4,786,352
The amount of borrowing costs capitalized during 2023 was TDKK 13,180. The rate used to determine the amount of
borrowing cost eligible for capitalization was 3.84%
GROUP
TDKK Vessels
Operating
Equipment
& Fixtures Buildings
Prepay-
ments Total
Cost:
At 01.01.2024 6,848,598 40,105 62,729 609,496 7,560,928
Adjustment to prior year 830 0 0 0 830
Additions during the year 132,049 1,859 187 284,065 418,160
Disposals -35.391 -10,115 0 0 -45,506
Reclasssifications 24,304 1458 0 -25,762 0
At 31.12.2024 6,970,390 33,307 62,916 867,799 7,934,412
Depreciation and impairment:
At 01.01.2024 2,709,876 34,718 29,981 1 2,774,576
Adjustment to prior year 830 0 0 0 830
Disposals -33,284 -10,115 0 0 -43,399
Depreciation 266,291 2,625 1,783 0 270,699
Reclassifications 0 -1 0 0 -1
At 31.12.2024 2,943,713 27,227 31,764 1 3,002,705
Carrying amount 31.12.2024 4,026,677 6,080 31,152 867,798 4,931,707
The amount of borrowing costs capitalized during 2024 was TDKK 26,176. The rate used to determine the amount of
borrowing cost eligible for capitalization was 4%
Commitments for tangible assets
ESVAGT has one vessel under construction for delivery in 2025 and two vessels for delivery in 2026.
GROUP PARENT
TDKK 2024 2023 2024 2023
Remaining Commitments, new building program 929,000 1,100,000 929,000 1,100,000
929,000 1,100,000 929,000 1,100,000
Note 10
PROPERTY, PLANT AND EQUIPMENT
ESVAGT ANNUAL REPORT 2024
35
PARENT
TDKK Vessels
Operating
Equipment
& Fixtures Buildings
Prepay-
ments Total
Cost:
At 01.01.2023 6,765,423 45,215 62,679 199,396 7,072,713
Adjustment to prior year 0 0 0 0 0
Additions during the year 77,140 5,380 0 417,931 500,451
Disposals 0 0 0 0 0
Reclasssifications 6,035 -10,490 50 -7,831 -12,236
At 31.12.2023 6,848,598 40,105 62,729 609,496 7,560,928
Depreciation and impairment:
At 01.01.2023 2,453,445 33,231 27,565 0 2,514,241
Adjustment to prior year 0 0 0 0 0
Disposals 0 0 0 0 0
Depreciation 268,028 1,454 2,416 0 271,898
Reclassifications -11,597 33 0 1 -11,563
At 31.12.2023 2,709,876 34,718 29,981 1 2,774,576
Carrying amount 31.12.2023 4,138,722 5,387 32,748 609,496 4,786,352
The amount of borrowing costs capitalized during 2023 was TDKK 13,180. The rate used to determine the amount of
borrowing cost eligible for capitalization was 3.84%
PARENT
TDKK Vessels
Operating
Equipment
& Fixtures Buildings
Prepay-
ments Total
Cost:
At 01.01.2024 6,848,598 40,105 62,729 609,496 7,560,928
Adjustment to prior year 830 0 0 0 830
Additions during the year 132,049 1,859 187 284,065 418,160
Disposals -35,391 -10,115 0 0 -45,506
Reclasssifications 24,304 1,458 0 -25,762 0
At 31.12.2024 6,970,390 33,307 62,916 867,799 7,934,412
Depreciation and impairment:
At 01.01.2024 2,709,876 34,718 29,981 1 2,774,576
Adjustment to prior year 830 0 0 0 830
Disposals -33,284 -10,115 0 0 -43,399
Depreciation 266,291 2,625 1,783 0 270,699
Reclassifications 0 -1 0 0 -1
At 31.12.2024 2,943,713 27,227 31,764 1 3,002,705
Carrying amount 31.12.2024 4,026,677 6,080 31,152 867,798 4,931,707
The amount of borrowing costs capitalized during 2024 was TDKK 26,176. The rate used to determine the amount of
borrowing cost eligible for capitalization was 4%
Commitments for tangible assets
ESVAGT has one vessel under construction for delivery in 2025 and two vessels for delivery in 2026.
GROUP PARENT
TDKK 2024 2023 2024 2023
Remaining Commitments, new building program 929,000 1,100,000 929,000 1,100,000
929,000 1,100,000 929,000 1,100,000
Note 10 – continued
PROPERTY, PLANT AND EQUIPMENT
ESVAGT ANNUAL REPORT 2024
36
Impairment analysis
ESVAGT has over the last years, as many other industries, been affected by high inflation and interest rates, but at the
same time been in an industry with increasing demand and dayrates. This uplift derived from the geopolitical focus on
securing alternative energy sources and the increasing ambitions for green energy transition.
ESVAGT’s business model build to handle volatile macroeconomic effects and market conditions by always utilizing the
fleet efficient and optimal, while keeping cost in control and at its minimum. ESVAGT thereby consistently been able to
show results within expectations, by delivering high service and performance from its existing ERRV and SOV fleet. This
is still done along with continuation of the overall growth plan within the fast-growing offshore wind segment.
Outcome of the impairment test
The drivers behind ESVAGT’s short- and long-term budget are affecting the Impairment both negatively and posi-
tively. The GBP still increasing while NOK yet again decreased. The WACC reduced by ~0,1% in both segments as the
risk-free rate marginally decreased over the year, which reduced the cost of equity and cost of debt. The headroom
nearly halved for our most challenged CGU, G2/3, which is the main reason for the decrease in ESVAGTs headroom. The
impairment test still shows a positive headroom and no impairment loss to be recognized in 2024.
Basis for impairment test
ESVAGT considers vessels with similar functionality as cash generating units (CGU) due to largely interdependent cash
flows. The recoverable amount for each CGU is determined as the present value of future net cash flow from each or
fair value less cost to sell if higher. ESVAGT applies value-in-use calculations in the Impairment Analysis.
The value-in-use is calculated based on cash flow projections in financial forecasted budgets, based on management
long term key assumptions and market expectations. Thereby an expected inflation rate of 2.5% (2023: 2.5%) p.a. is
applied after 2026 and onwards together with individual day-rate and utilization assumptions post-contract for each
vessel. These cash flow projections are subject to judgement and estimates that are uncertain, though based on expe-
rience and external sources where available. Below different sensitivity analysis for certain key assumptions applied in
the expected future cash flows.
The discount rate applied in the value-in-use calculation is 6.40% (2023: 6.50%) for ERRV segment and 5.90% (2023:
6.00%) for WIND segment p.a. after tax. The discount rate applied reflect the specific risks relating to the relevant
CGU’s.
The FX rates applied is based on the FX rate level on 31 December 2024:
• GBP: 899.34 (2023: 857.59)
• NOK: 62.98 (2023: 66.30)
• EUR: 746.00 (2023: 745.29)
• USD: 714.29 (2023: 674.47)
Sensitivity analysis
The value-in-use calculations for the individual CGU’s are particularly sensitive to the day rates expected post-contract
and to utilization on ERRV spot activities. In addition, discount rate, inflation rate and changes in FX rates are critical
assumptions. Especially the headroom in CGU ERRV G2/G3 being challenged last couple of years and the result of
sensitivity tests listed below for the CGU.
The headroom between the recoverable amount and the carrying amount for the CGU ERRV G2/G3 is DKK 64 million in
2024 (2023: DKK 111 million) and the sensitivity analysis for the unit shows that the headroom would have been:
• A +/- 0.5 percentage point change in the WACC, keeping all other assumptions unchanged, results in a DKK 37
million and DKK 93 million spread
• A -/+ 5 percentage point change in the Market spot rate, keeping all other assumptions unchanged, results in a DKK
-129 million and DKK 211 million spread.
• A -/+ 0.5 percentage point change in the long-term inflation rate, keeping all other assumptions unchanged, results
in DKK 49 million and DKK 79 million spread.
• A -/+ 1 percentage point change in the GBP and NOK FX rate, keeping all other assumptions unchanged, results in a
DKK 28 million and DKK 100 million spread..
The above sensitivity test only shows a potential risk for negative headroom in a -5 percentage point change in the
market spot rates. The probability hereof however doesn’t seem likely as we expect it only would be short-term
decrease as several Oil & Gas projects expected to be extended or renewed in the near future.
Note 10 – continued
PROPERTY, PLANT AND EQUIPMENT
ESVAGT ANNUAL REPORT 2024
37
GROUP PARENT
TDKK 2024 2023 2024 2023
Carrying Amount
Financial assets:
Financial assets at fair value
Interest rate swap 59,995 76,992 59,995 76,992
Total financial assets at fair value 59,995 76,992 59,995 76,992
Financial assets at amortised cost:
Trade receivables 193,408 218,654 160,997 159,490
Receivables from parent company 9,125 7,032 9,125 7,032
Receivables from Group companies 0 0 344,538 261,326
Receivables from joint ventures 212,529 127,825 0 0
Other Receivables 9,402 11,287 9,396 11,195
Cash and cash equivalents 138,880 125,412 130,135 103,114
Total Financial assets at amortised cost 563,344 490,210 654,191 542,157
Total Financial assets 623,339 567,202 714,186 619,149
Financial liabilities:
Financial liabilities at fair value
Foreign currency forwards (used for hedging) 3,510 4,052 3,510 4,052
Total financial liabilities at fair value 3,510 4,052 3,510 4,052
Financial liabilities at amortised cost:
Borrowings 3,293,633 3,059,428 3,293,633 3,059,428
Trade payables 77,600 77,370 77,225 77,248
Payables to Group companies 0 0 1,221 1,259
Lease liabilities 139,150 190,394 139,150 190,394
Other Payables 100,337 93,123 100,249 93,041
Total Financial liabilities at amortised cost 3,610,720 3,420,315 3,611,478 3,421,370
Total Financial liabilities 3,614,230 3,424,367 3,614,988 3,425,422
Fair value is approximately the same as the carrying amounts.
GROUP PARENT
TDKK 2024 2023 2024 2023
Bunker oil 13,757 18,260 13,757 18,260
13,757 18,260 13,757 18,260
During 2024 TDKK 101,276 (2023: TDKK 106,964) was recognized as an expense for the group, and TDKK 101,276
(2023: TDKK 106,964) for the parent company.
Note 13
TRADE RECEIVABLES
GROUP PARENT
TDKK 2024 2023 2024 2023
Trade receivables at 31 December 196,253 221,367 163,842 159,590
Expected credit loss -2,845 -2,713 -2,845 -100
Trade receivables net 193,408 218,654 160,997 159,490
The maturity of the trade receivables is specified as follows:
Not overdue 129,492 141,965 109,045 107,877
Up to 30 days 52,197 73,653 46,943 51,086
Between 31 and 90 days 8,979 3,005 5,009 514
Between 91 and 365 days 2,740 31 0 12
Total 193,408 218,654 160,997 159,490
Note 11
FINANCIAL ASSETS AND LIABILITIES
Note 12
INVENTORIES
ESVAGT ANNUAL REPORT 2024
38
The group applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected
loss allowance for all trade receivables and contract assets.
To measure the expected credit losses, trade receivables and contract assets have been grouped based on shared
credit risk characteristics and the days past due. The contract assets relate to unbilled work in progress and have
substantially the same risk characteristics as the trade receivables for the same types of contracts. The group has there-
fore concluded that the expected loss rates for trade receivables are a reasonable approximation of the loss rates for
the contract assets.
The expected loss rates are based on the payment profiles of sales over a period of 36 month before 31 December
2024 or 31 December 2023 respectively and the corresponding historical credit losses experienced within this period.
The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors
affecting the ability of the customers to settle the receivables. The group has identified the GBP and the oil and energy
prices to be the most relevant factors, and accordingly adjusts the historical loss rates based on expected changes in
these factors. The expected credit losses for all trade receivables and contract assets, 94.0% less than 30 days overdue,
6.0% 30-90 days overdue and 0.0% over 90 days overdue, are immaterial and therefore not recognized.
As further described in note 21, the receivables from Group companies are primarily arising from ordinary sales trans-
actions and are in general repaid in full on a monthly basis. Consequently, the 12-month expected credit losses related
to those receivables are immaterial.
The share capital comprise of:
No. shares
Nominal value
per share 2024 TDKK 2023 TDKK
2,200,000 1 2,200 2,200
2,200,000 1 2,200 2,200
No shares carry any special rights. There are no restrictions connected to the transferability or voting rights of the
shares. All shares have been fully paid in.
All shares in ESVAGT A/S are owned by ERRV ApS.
Capital management
The group’s objectives when managing capital are to safeguard the group’s ability to continue as a going concern in
order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital struc-
ture to reduce cost of capital. Normal covenant demands applies such as “Leverage Ratio”, “ICR Ratio” etc. which we
have been compliant with during the year.
The Group has not adopted a specific key ratio, but Management and Board of Directors monitor the share and capital
structure to ensure that the group’s capital resources support the strategic goals. The overall target is to have secured
long term financing with fixed interest rates at competitive rates.
The Company’s policy for managing capital is unchanged from last year.
Note 13 – continued
TRADE RECEIVABLES
Note 14
SHARE CAPITAL
ESVAGT ANNUAL REPORT 2024
39
GROUP PARENT
TDKK 2024 2023 2024 2023
At 1 January 349 0 0 0
Deferred tax recognized in the income statement -366 349 0 0
Exchange Rate Adjustment 17 0 0 0
At 31 December 0 349 0 0
Deferred tax relates to:
Loss carried forward 0 349 0 0
0 349 0 0
The borrowings comprise of vessel financing related loans as well as revolving facilities to fund the ongoing operations.
There are covenants attached to the loan facilities.
Currency Maturity 2024 TDKK 2023 TDKK
Group
Floating rate loans DKK 2029 410,000 200,000
Fixed-rate loans EUR 2029 1,803,126 1,801,409
Fixed-rate loans DKK 2029 413,000 413,000
Fixed-rate loans GBP 2029 741,490 707,068
Parent
Floating rate loans DKK 2029 410,000 200,000
Fixed-rate loans EUR 2029 1,803,126 1,801,409
Fixed-rate loans DKK 2029 413,000 413,000
Fixed-rate loans GBP 2029 741,490 707,068
The above fixed-rate loans are considered as fixed-rate until 2027 due to rate swaps. Hereafter TDKK 1,727,160 will be
floating until 2029.
Note 15
DEFERRED TAX
Note 16
BANK AND CREDIT INSTITUTIONS
ESVAGT ANNUAL REPORT 2024
40
The statement of profit or loss show the following amounts relating to leases:
GROUP PARENT
TDKK 2024 2023 2024 2023
Depreciation charge of right-of-use assets
Land 337 337 337 337
Cars 718 573 718 573
Equipment 14,405 12,466 14,405 12,466
Vessels 8,357 8,357 8,357 8,357
23,817 21,733 23,817 21,733
The total cash outflow for leases in 2024 was TDKK 53,983 (2023: TDKK 51,169) for the Group and TDKK 53,983 (2023:
TDKK 51,169) for the parent company.
GROUP PARENT
TDKK 2024 2023 2024 2023
Interest expense (included in finance expenses) 14,537 18,205 14,537 18,205
Expense relating to short-term leases (included in other oper-
ating expenses) 998 1,365 998 1,365
15,535 19,571 15,535 19,571
The group has entered leases on land, properties, cars, equipment and two Multipurpose ERRV’s. The remaining lease
period for land is 19 years + 5 months. ESVAGT can terminate the contract of the leased land with a 6 months’ notice.
The non-cancellable lease period for cars is typically 36 months. In general car leases do not include any extension
options. The two Multipurpose ERRV’s are leased on a bareboat charter for 6 years. Lease terms are negotiated on an
individual basis and contain a wide range of different terms and conditions. The lease agreements in general do not
impose any covenants but leased assets may not be used as security for borrowing purposes. Exception for main rule is
the two Multipurpose ERRV’s as they comply with the covenant requirements in force at any time towards the external
lenders.
The Group recognized the following amounts relating to leases:
GROUP PARENT
TDKK 2024 2023 2024 2023
Lease liabilities
Current 51,067 54,255 51,067 54,255
Non-current 88,083 136,139 88,083 136,139
139,150 190,394 139,150 190,394
Right-of-use assets
Land 6,215 6,553 6,215 6,553
Cars 1,153 2,013 1,153 2,013
Equipment 3,825 11,723 3,825 11,723
Vessels 215,156 223,512 215,156 223,512
226,349 243,801 226,349 243,801
Additions to the right-of-use assets during the 2024 financial year were TDKK 6,579 (2023: TDKK 17,731) for the Group
and TDKK 6,579 (2023: TDKK 17,731) for the parent company, respectively.
Note 17
LEASING
ESVAGT ANNUAL REPORT 2024
41
Note 18
FEE TO THE STATUTORY AUDITORS
As part of its asset and liability management, the Group uses derivatives for hedging purposes in order to reduce its
exposure to market risks.
The group has entered foreign exchange contracts to hedge currency risk on contracted long-term revenue and fuel
consumption.
Further Interest Rate Swap is used to exchange the floating rate interest payments to fixed-rate interest payments.
Information about the group’s exposure to financial risk is provided in note 25.
GROUP PARENT
TDKK 2024 2023 2024 2023
Reclassified from other comprehensive income
Gains/losses arising on currency forward contracts (cash flow
hedges) reclassified to revenue/other operating expenses
during the year -6,527 2,148 -6,527 2,148
Interest rate swaps -16,997 -50,826 -16,997 -50,826
-23,524 -48,678 -23,524 -48,678
Note 19
DERIVATIVE FINANCIAL INSTRUMENTS
GROUP PARENT
TDKK 2024 2023 2024 2023
Statutory audit 873 790 873 790
Tax and VAT advisory services 163 337 163 337
Other services 962 424 962 424
Total fees to PwC 1,998 1,551 1,998 1,551
ESVAGT ANNUAL REPORT 2024
42
Note 20
RELATED PARTIES
The Company and its parent company ERRV ApS are included in the consolidated financial statements for ERRV
Holdings ApS, Dokvej 4, 6700 Esbjerg, Denmark.
Interest in subsidiaries and joint ventures are set out in note 22.
The ultimate controlling party is 3i Infrastructure plc, United Kingdom.
The following transactions were carried through with related parties:
GROUP PARENT
TDKK 2024 2023 2024 2023
Transactions with subsidiaries
Sales of services 0 0 238,341 276,611
Transactions with joint ventures
Sales of services 1,782 1,741 1,782 1,741
1,782 1,741 240,123 278,352
The following balances arising from sales/purchases of goods and services are outstanding at the end of the period in
relation to transactions with related parties:
GROUP PARENT
TDKK 2024 2023 2024 2023
Receivables from subsidiaries 0 0 28,170 71,062
Receivables from joint ventures 0 1,741 1,782 1,741
Loans to related parties
Loans to ERRV ApS and ERRV Holding ApS (parent company)
Beginning of the period 7,032 5,875 7,032 5,875
Loans advanced 1,734 809 1,734 809
Loans repayments received 0 0 0 0
Interest charged 359 348 359 348
End of year 9,125 7,032 9,125 7,032
Loans to subsidiaries
Beginning of the period 0 0 200,039 280
Adjustment to previous period 0 0 0 -280
Loans advanced 0 0 127,561 192,274
Loans repayments received 0 0 0 0
Interest charged 0 0 11,590 7,765
End of year 0 0 339,190 200,039
ESVAGT ANNUAL REPORT 2024
43
Note 20 – continued
RELATED PARTIES
GROUP PARENT
TDKK 2024 2023 2024 2023
Loans to joint ventures
Beginning of the period 127,825 0 0 0
Loans advanced 84,704 127,825 0 0
Loans repayments received 0 0 0 0
Interest charged 0 0 0 0
End of year 212,529 127,825 0 0
Loans from subsidiaries
Beginning of the period 0 0 2,265 1,675
Adjustment to previous period 0 0 0 280
Loans advanced 0 0 1,828 692
Loans repayments 0 0 277 488
Interest charged 0 0 122 105
End of year 0 0 3,937 2,265
Terms and conditions
Receivables from the Group companies primarily arises from ordinary operations and are in general repaid in full on a
monthly basis. The receivables do not thus carry any interest. Loans to the parent company and to and from subsid-
iaries carry an interest of 4.60% (2023: 5.60%) and the loans are expected to be settled in cash.
The group has interest in a number of individually immaterial joint ventures that are accounted for using the equity
method.
GROUP PARENT
TDKK 2024 2023 2024 2023
Summarised balance sheet
Aggregated carrying amount of individually
immaterial joint ventures 106,735 64,215 0 0
Aggregate amounts of the group's share of
Loss from continuing operations 82 84 0 0
Total comprehensive income 82 84 0 0
ESVAGT has, through Esvagt Holdings, Inc. (USA) invested in a joint venture, Crowley SOV 1, LLC with an ownership of
25%. The activity of the joint venture is to build and operate an SOV vessel for Siemens Gamesa Renewable Energy
under a long-term contract. The construction proces of the SOV vessel has started in second half of 2023 and the
vessel is expected to be in operation during 2026.
Note 21
INVESTMENTS IN JOINT VENTURES
ESVAGT ANNUAL REPORT 2024
44
Note 23
CASH FLOW STATEMENT
Note 22
CONTINGENT LIABILITIES
GROUP PARENT
TDKK 2024 2023 2024 2023
Change in working capital
Change in inventories 4,503 6,197 4,503 6,197
Change in trade receivables and receiv. from parent 23,153 -20,363 -3,600 -27,300
Change in other receivables and prepayments 2,741 2,518 2,657 -223
Change in trade payables, excl. payables related to fixed assets 230 5,868 -23 5,868
Change in other payables 7,214 -6,100 7,207 -6,175
Change in received prepayments -2,589 -2,577 -2,589 -2,577
Exchange gains and losses on working capital -331 -205 -331 -151
34,921 -14,662 7,824 -24,361
Changes in liabilities arising from financing activities
Bank and credit institutions at 1 January 3,059,428 2,829,283 3,059,428 2,829,283
Proceeds from loans from credit institutions 210,016 200,038 210,016 200,038
Amortized loan cost -11,933 10,400 -11,933 10,400
Foreign currency 36,122 19,707 36,122 19,707
Bank and credit institutions at 31 December 3,293,633 3,059,428 3,293,633 3,059,428
Lease liabilities at 1 January 190,394 223,832 190,394 223,832
Repayment of leases -54,777 -51,169 -54,777 -51,169
New leases 3,533 17,731 3,533 17,731
Lease liabilities at 31 December 139,150 190,394 139,150 190,394
Financing liabilities at 31 December 3,432,783 3,249,822 3,432,783 3,249,822
Litigation
None
GROUP PARENT
TDKK 2024 2023 2024 2023
Bank loans secured in vessels
Bank and other credit institutions - amount secured 3,367,616 3,121,478 3,367,616 3,121,478
Carrying amount of vessels provided as security 4,026,677 4,138,722 4,026,677 4,138,722
Other contingent liabilities
Since 17 September 2015 ESVAGT A/S is part of national joint taxation in Denmark with ERRV Holding ApS and is
jointly liable with other Danish companies owned by ERRV Holding ApS.
ESVAGT ANNUAL REPORT 2024
45
Note 24
FINANCIAL RISK MANAGEMENT
Financial risk factors
The Financial risks of the group are managed centrally. The overall risk management guidelines and policies have been
approved by the Board of Directors. Group Finance/Treasury department identifies and evaluates exposures in close
co-operation with the group’s operating units. The board provides written principles for overall risk management.
Market Risk
Foreign exchange risk
The revenue is denominated in other currencies than DKK, mainly EUR, GBP and NOK. Part of these transactions is
hedged according to the Group policy. Increases or decreases in the exchange rate of GBP and NOK against the func-
tional currency, can affect the group’s results and cash position negatively or positively.
The cost of goods sold, and operating expenses are mainly incurred in DKK. The Group has transactions in other
currencies, mainly EUR, but the foreign exchange risks related to this are not considered material, due to fixed change
rate policy in Denmark against EUR. Fuel expenses are however paid in USD and most fuel expenses are reinvoiced to
customers, and therefore not hedged according to the Group policy. Increases or decreases in the exchange rate of
such foreign currency against the functional currency, can affect the group’s results and cash position negatively or
positively.
Exposure
The group’s exposure to foreign currency risk at the end of the reporting period, in the different currency units
converted to TDKK, was as follows:
GROUP
Currency amounts converted to TDKK EUR GBP NOK USD
2024
Trade receivables 84,155 36,936 28,248 757
Receivables from joint ventures 0 0 0 212,529
Cash and cash equivalents 40,676 37,264 33,613 1,942
Bank loans -1,803,133 -741,490 0 0
Trade payables -20,194 -2,546 -2,245 -15,456
-1,689,496 -669,836 59,616 199,772
2023
Trade receivables 78,805 63,678 23,641 1,710
Receivables from joint ventures 0 0 0 127,859
Cash and cash equivalents 7,496 17,741 39,062 17,631
Bank loans -1,801,409 -707,068 0 0
Trade payables -11,019 -3,774 -1,708 -15,421
-1,726,127 -629,423 60,995 131,779
ESVAGT ANNUAL REPORT 2024
46
Note 24 – continued
FINANCIAL RISK MANAGEMENT
2024 2023
TDKK
Impact on
Post Tax
Profit
Impact on
Other
Components
of Equity
Impact on
Post Tax
Profit
Impact on
Other
Components
of Equity
Group
GBP/DKK exchange rate - increase 10% -66,984 -66,984 -62,942 -62,942
NOK/DKK exchange rate - increase 10% 5,962 5,962 6,100 6,100
USD/DKK exchange rate - increase 10% -1,276 -1,276 13,178 13,178
Parent
GBP/DKK exchange rate - increase 10% -70,159 -70,159 -70,105 -70,105
NOK/DKK exchange rate - increase 10% 5,884 5,884 6,011 6,011
USD/DKK exchange rate - increase 10% -1,435 -1,435 74 74
2024 2023
TDKK
Impact on
Post Tax
Profit
Impact on
Other
Components
of Equity
Impact on
Post Tax
Profit
Impact on
Other
Components
of Equity
Group
Interest rates – increase by 100 basis points -4,100 0 -2,000 0
Interest rates – decrease by 100 basis points -4,100 0 2,000 0
Parent
Interest rates – increase by 100 basis points -4,100 0 -2,000 0
Interest rates – decrease by 100 basis points -4,100 0 2,000 0
The calculation is based on an increase in both short- and long-term interest. All other variables are held constant.
Loans are in floating interest rate duration 4.5 years. Interest rate is swapped to fixed rate for 2.5 years.
PARENT
Currency amounts converted to TDKK EUR GBP NOK USD
2024
Trade receivables 82,480 5,472 28,248 0
Cash and cash equivalents 34,350 36,972 32,836 1,103
Bank loans -1,803,133 -741,490 0 0
Trade payables -20,194 -2,546 -2,245 -15,456
-1,706,497 -701,592 58,839 -14,353
2023
Trade receivables 75,277 5,373 23,641 0
Cash and cash equivalents 1,433 4,418 38,180 16,163
Bank loans -1,801,409 -707,068 0 0
Trade payables -11,019 -3,774 -1,708 -15,421
-1,735,718 -701,051 60,113 742
Interest rate risk
The group’s interest rate risk arises from long-term borrowings. Borrowings issued at variable rates expose the group
to cash flow interest rate risk. Borrowings issued at fixed rates expose the group to fair value interest risk. Group policy
is always to ensure that a minimum of 70 percent of total outstanding debt is fixed rate or effectively bears a fixed rate
pursuant to a hedging agreement. The group is compliant with the policy at 31 December 2024.
Sensitivity analysis
Profit or loss is sensitive to higher/lower interest from borrowings and fair value changes of interest rate derivatives as
a result of changes in interest rates. The sensitivity analysis is based on financial instruments recognized at the balance
sheet date.
ESVAGT ANNUAL REPORT 2024
47
Note 24 – continued
FINANCIAL RISK MANAGEMENT
GROUP
TDKK
Less than
1 year 1-5 years > 5 years Total
Non-derivatives
At 31.12.2023
Credit institutions* 151,341 0 3,121,478 3,272,819
Lease liabilities 54,255 136,139 0 190,394
Trade payables 77,370 0 0 77,370
Other payables 93,123 0 0 93,123
376,089 136,139 3,121,478 3,633,706
At 31.12.2024
Credit institutions* 171,035 3,367,616 0 3,538,651
Lease liabilities 51,067 88,083 0 139,150
Trade payables 77,600 0 0 77,600
Other payables 100,337 0 0 100,337
400,039 3,455,699 0 3,855,738
* Expected interest payment
Derivatives
At 31.12.2023
Foreign exchange options / forwards used to hedge currency
and interest rate risk -4,052 76,992 0 72,940
-4,052 76,992 0 72,940
At 31.12.2024
Foreign exchange options / forwards used to hedge currency
and interest rate risk -3,510 59,995 0 56,485
-3,510 59,995 0 56,485
Credit risk
Credit risk is managed on group basis, except for credit risk relating to account receivable balances. Each local entity
is responsible for managing and analyzing the credit risk for each of their new clients before standard payment and
delivery terms and conditions are offered.
Credit risk arises from cash and cash equivalents and deposits with banks and financial institutions, as well as credit
exposures to customers, including outstanding receivables. For banks and financial institutions, only independently
rated parties with a minimum rating of 'BBB-' are accepted, For customers individual risk limits are set based on
internal or external ratings in accordance with limits set by the board. No significant risk related to intercompany trade
receivables due to monthly settlements as further described in note 20. Intercompany loans carry no significant risk, as
they provide funding during the US vessel's construction period until financing is secured. The utilization of credit limits
is regularly monitored.
The maximum exposure corresponds to the carrying amount of receivables and cash.
Liquidity Risk
Cash flow forecasting is performed by group finance. Group finance monitors rolling forecasts of the group’s liquidity
requirements to ensure it has sufficient cash to meet operational needs. Such forecasting takes into consideration the
group’s debt financing plans and compliance with loan documentation. The group has undrawn borrowing facilities
of TDKK 2,417,000. The borrowing facilities is part of the current bank facilities attached to the same covenants as
mentioned in note 16.
The tables below analyses the group’s derivatives and non-derivative financial liabilities into relevant maturity group-
ings based on the remaining period at the balance sheet date to the contractual maturity date. The amounts disclosed
in the table are the contractual undiscounted cash flows.
ESVAGT ANNUAL REPORT 2024
48
Note 24 – continued
FINANCIAL RISK MANAGEMENT
The group operates internationally and is exposed to foreign exchange risk, primarily the NOK, GBP and USD. Foreign
exchange risk arises from future commercial transactions denominated in currencies that are not DKK or EUR. The
risk is measured through forecasts of highly probable expenditures in NOK, GBP and USD. The risk is hedged with the
objective of minimizing the volatility of currency cost of highly probable revenue and purchases of property, plant and
equipment.
The group treasury’s risk management policy is to hedge up to 80% of forecast income and expenses in currencies
other than DKK and EUR up to two years in advance.
The group uses foreign currency forwards to hedge its exposure to foreign currency risk. Under the group’s policy the
critical terms of the forwards must align with the hedged items.
The group designates the forward rate of foreign currency forwards in hedge relationships. The intrinsic value of
foreign currency is determined with reference to the relevant spot market exchange rate.
Hedge effectiveness is determined at the inception of the hedge relationship, and through periodic prospective effec-
tiveness assessments to ensure that an economic relationship exists between the hedged item and hedging instrument
For hedges of foreign currency purchases, the group enters hedge relationships where the critical terms of the hedging
instrument match exactly with the terms of the hedged item. The group therefore performs a qualitative assessment of
effectiveness.
In hedges of foreign currency purchases, ineffectiveness may arise if the timing of the forecast transaction changes
from what was originally estimated, or if there are changes in the credit risk of ESVAGT or the derivative counterparty
and as differences between the spot rate and the forward rate of a contract.
Fair value
Financial instruments measured at fair value can be divided into three levels:
Level 1 - Quoted prices in active markets for identical assets or liabilities
Level 2 – Inputs other than quoted prices included in level 1 that are observable for the asset or liability
Level 3 – Input for the asset or liability that are not based on observable market data.
The fair value of bank borrowings does not differ significantly from the carrying amount. The fair value of derivatives is
calculated on level 2 in the fair value hierarchy using direct quotes.
Fair value measurements
GROUP PARENT
TDKK 2024 2023 2024 2023
Significant other observable inputs (Level 2)
Forwards used to hedge currency risk -3,510 -4,052 -3,510 -4,052
Forwards used to hedge interest risk 59,995 76,992 59,995 76,992
56,485 72,940 56,485 72,940
Measurement of derivatives
The valuation techniques used to measure derivatives include:
• the fair value of forward foreign exchange contracts is determined using forward exchange rates at the balance
sheet date.
Derivatives are only used for economic hedging purposes and not as speculative investments. However, where deriv-
atives do not meet the hedge accounting criteria, they are classified 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. Interest rate derivates entered with a value of TDKK 59,995.
ESVAGT ANNUAL REPORT 2024
49
Note 25
EVENTS AFTER THE BALANCE SHEET DATE
No events occurred after the balance sheet date.
Note 26
COMPOSITION OF THE GROUP
Name of Entity:
Ownership and
Voting Rights
held by ESVAGT
Place of Business/
Incorporation
Investments in subsidiaries
ESVAGT Holdings Limited 100% Great Britain
ESVAGT UK Limited 100% Great Britain
ESVAGT Norge AS 100% Norway
ESVAGT Holdings Inc 100% United States
P/F ESVAGT-THOR 51% Faroe Islands
Investments in Joint Ventures
Crowley SOV I, LLC 25% United States
Note 24 – continued
FINANCIAL RISK MANAGEMENT
The effects of the foreign currency related hedging instruments on the group’s financial position and performance are
as follows:
GROUP
NOK GBP USD
Foreign currency forwards as at 31 December 2023
Carrying amount in TDKK 0 21,000 18,600
Notional amount 0 176,691 126,484
Maturity date Jan2024 Jan2024
Jun2025 Mar2025
Weighted average hedged rate for the year (incl. forward points) 0.00 841.39 680.02
Foreign currency forwards as at 31 December 2024
Carrying amount in TDKK 96,008 88,144 22,041
Notional amount 150,000 10,200 3,300
Maturity date Jan2025 Jan2025 Jan2025
Jan2026 Dec2025 Mar2025
Weighted average hedged rate for the year (incl. forward points) 64.31 864.71 667.90
ESVAGT ANNUAL REPORT 2024
50
COMPANY
INFORMATION
Company
Company No. / CVR No. 60 69 88 13
Municipality of reg. office Esbjerg
Phone No. +45 78 73 07 30
Internet www.ESVAGT.com
E-mail mail@ESVAGT.com
Board of Directors
Jakob Bo Thomasen, Chairman
Anna Dellis
Lars Oscar Tylegård
Søren Poulsgaard Jensen
Henrik Gorzelak Pedersen
Jess Høeg
Executive Management
Søren Karas
Kristian Ole Jakobsen
Audit
ESVAGT ANNUAL REPORT 2024
51
