Annual Report 2022
DK-2800 Kongens Lyngby
CVR 28315694
Rethinking
water
01 03 05
060402
2022 commentary
Letter from the Chair
Letter from the CEO
Financial highlights
Key figures
Key events
Sustainability
Sustainability approach
Environment & climate
Social & employees
Governance
Diversity
ESG matrix
Sustainability targets
Glossary
Consolidated financial statements
Statements
Notes
Parent company financial statements
Statements
Notes
Management’s statement
Independent auditor’s report
Governance
Corporate governance
Risk management
Shareholder information
Executive Management
Board of Directors
Our business
Our strategy coming to life
Our values
Business model
Core technology
Business areas
Research & development
Open innovation
Outlook
Content
Aquaporin
Annual Report 2022
01 Commentary 2
Aquaporin at a glance
Our solutions are anchored in nature; based and
inspired from the aquaporin protein – nature’s own
water filter. Listed on Nasdaq Copenhagen (ticker:
AQP), Aquaporin has operations in Denmark (HQ),
China, Singapore, Turkey, and the US.
Headquarter
Lyngby, Denmark
Istanbul,
Turkey
Shanghai,
China
Singapore
Los Angeles,
United States
Rethinking
water filtration
86 employees
Aquaporin Inside
®
We are global
Removes PFAS
revenue growth
243%
We are in space
Our purpose
One core technology
With customers and partners
on all continents
and other forever chemicals
for the full year 2022
compared to 2021
Our Aquaporin Inside®
technology is used in the
international space station
merging biotechnological
techniques and classical
engineering.
Aquaporin
Annual Report 2022
01 Commentary 3
It has been a busy and pivotal 12 months in
Aquaporin’s development. Our focus in the
Board of Directors was to ensure that the
Company built robust processes and
organizational structures appropriate to our
new status as a listed company. Having the
right framework in place gives us the best
opportunity to deliver on our ambition to
create a sustainable water technology
company with a global presence, building
revenue growth in the coming years. Two
important building blocks to position us for
the next stage of company growth was to
further strengthen the leadership team with
vital competencies, and to secure a financial
foundation for the company – both of which
we achieved with the appointment of key
managerial roles and the successful capital
raise carried out in February 2023.
Building a business with sustainability
at its core
Protecting the environment and people’s
health by creating sustainable solutions are
the main drivers for the work we do at
Aquaporin. During 2022, we sharpened our
strategic focus on Drinking Water, further
enabling us to provide solutions for clean
water globally. We were then able to leverage
our understanding and know-how from that
segment, to provide relevant and sustainable
solutions in our other business areas of
interest, Industrial Water and Food &
Beverage.
Change starts with people
The team at Aquaporin is crucial to ensure
that we can succeed in creating a better and
healthier environment for the future. Our
strong purpose and corporate culture,
centered on innovation and responsibility, is
key to making us an attractive employer and
an interesting and enjoyable place to work. I
was therefore very pleased that we were able
to add vital competencies to both the
Executive Management team and in areas of
commercial and R&D. Our commitment to
fighting the water crisis and our support of
the UN’s sustainability goals are integral to
our company culture, leading to a high level
of engagement of our employees. We have
had a fantastic journey to date at Aquaporin
and I would like to take this opportunity to
thank the employees for their hard work and
dedication in building the company to where
it is today. The future is exciting, and we look
forward to new achievements as the
company continues to grow.
Challenging macro environment
As we emerged from the global pandemic,
the macro environment has presented new
challenges during 2022. Aquaporin, like
other businesses, had to carefully navigate
unpredictable financial markets, rises in the
cost of living and in particular energy price
hikes, as well as the broader effects of an
unstable geopolitical situation. Our company
is on an important development trajectory
and in the Board of Directors we are highly
focused on the need to ensure the company
has the resources it needs to be able to
deliver on our longer-term purpose. It was
therefore an important milestone that we
were able to inject new capital into the
business and have the support of existing
and new investors as we continue to build
the company.
As we look towards the next year for
Aquaporin, I am both proud of what we have
achieved so far – often against challenging
global events beyond our control – and of
what is to come. We can only achieve
success with the support of our stakeholders,
and I am grateful to all our customers,
partners, and not least our shareholders, for
joining us on our journey to create a better,
healthier environment for our global society
in the future.
Niels Heering
Chair of the Board of Directors,
Aquaporin A/S
“ Having the right framework in place gives us the
best opportunity to deliver on our ambition to
create a sustainable water technology company
with a global presence, building revenue growth
in the coming years.”
Aquaporin
Annual Report 2022
01 Commentary 6
A year of growth,
commercial traction,
and making an impact
At the core of Aquaporin is our strong purpose of rethinking water
filtration with biotechnology to benefit both the environment and
health. During 2022, we sharpened our strategic focus, as we
pursued our ambition to become a sustainable business
delivering unique products and better quality water globally.
We grew our revenue more than three-fold.
Letter from the CEO
Aquaporin
Annual Report 2022
01 Commentary 7
We have achieved a great deal in our first full
year since our Initial Public Offering in
mid-2021. Despite the challenging macro-
economic backdrop of a global financial
downturn, the knock-on effects of the
pandemic and rising energy costs, we have
sharpened our strategic focus and increased
our revenue more than three-fold, as we
pursued our ambition to become a sustainable
business and recognized brand for delivering
better quality water through innovative
products – globally.
During 2022, we took the strategic decision
to streamline our efforts by having a primary
focus on the Drinking Water (DW) segment,
while continuing to invest and innovate in
select areas of Industrial Water, Food &
Beverage, and core technology development.
We believe this decision will continue to
support our revenue growth and provide a
solid and continued validation of our core
technology in the clean water revolution
landscape.
Repeat customers are key to our growth
strategy and in the Drinking Water segment
our aim is to leverage collaborations with
established industry players to provide us with
an expanded product reach. This in turn helps
us build a strong brand within the sector as a
provider of innovative products that deliver
clean water solutions. It also further gives us
the ability to invest in product innovation and
in other areas where we believe there is
potential for strong market development –
Industrial Water and Food & Beverage. The
Philips Water Solutions partnership is a good
example of how we can leverage our
collaborations. We were able to expand our
collaboration with Philips, gaining access to
China, one of the largest markets for water
purification. In 2022, Aquaporin Inside® was
introduced to more than 150,000 households
and schools combined, allowing an even
greater number of people to have access to
clean and healthy drinking water.
We have also made significant inroads with
multiple important players in Industrial Water
and Food & Beverage where our Forward
Osmosis technology is used to create
innovative processes and products. In 2022,
we piloted and sold products and systems to
some of the world’s largest brands while also
working on adventurous endeavors like
reusing water in space. Amongst other things,
we sold a pilot unit to E. & J. Gallo, which
eventually led us to sign a multi-year joint
development agreement with them in Q1
2023. This of significant importance as it
solidifies our presence in the Food &
Beverage segment, paving the way into the
United States.
Ensuring we have a commercial angle when
working with innovation is also key to our
future success. During 2022 we invested in
building an organization where key functions
from our R&D organization were integrated
“ I am confident we have laid much of the
groundwork and created an organizational
structure at Aquaporin to deliver on our ambition
to be a leader in the revolution to provide clean,
natural drinking water for all.”
into product and commercial teams. Creating
holistic teams allows us to create innovative
products that answer a clear market need.
This approach was supported throughout the
year with Open Innovation projects in areas
like hemodialysis and brine management – all
of which have a commercial alignment with
clear deliverables.
At the core of Aquaporin is our strong
purpose of rethinking water filtration with
biotechnology to benefit both the environment
and health. I am proud that we are part of the
solution to one of the key needs for providing
clean water – the filtration of PFAS from
drinking water supplies.
PFAS have been used in industrial production
for over 70 years, but recent research has
pointed to the harmful effects of these forever
chemicals on both the environment and our
health. Our Aquaporin Inside® technology,
used in all our products to purify and clean
water, effectively removes PFAS in excess of
99%. During 2022, we released data from the
University of Aarhus based on our water
purifier, illustrating the effectiveness of our
technology. We will continue through our
collaborations with universities and other
stakeholders to work on solutions to remove
PFAS and eventually destroy it.
We are at the beginning of an exciting journey
to become a leading player in the clean water
revolution. The global economic outlook for
the next 12-24 months is uncertain, but with
our latest fund-raising and sharpened
business focus, I believe Aquaporin is
well-equipped to meet our growth objectives.
Our employees work tirelessly to deliver on
the promise of our technology and capabilities
to benefit the planet both environmentally and
in health. Our customers support and validate
our market approach by purchasing products,
and our shareholders support our efforts to
bring cleaner water and process solutions to
benefit and safeguard the future of our planet.
I would like to take this opportunity to thank
you all for your trust, efforts, and
contributions.
Looking ahead, I am confident we have laid
much of the groundwork and created an
organizational structure at Aquaporin to
deliver on our ambition to solve global water
challenges by rethinking water filtration with
biotechnology. I hope you will continue to join
me and the Aquaporin team on that journey
and look forward to the challenges and
rewards ahead.
Matt Boczkowski
Chief Executive Officer,
Aquaporin A/S
Aquaporin
Annual Report 2022
01 Commentary 8
Financial highlights
2022 was another successful year for Aquaporin, with an
increasing revenue stream and continued growth across
our product portfolio.
Revenue
DKKm
EBITbefore special items
DKKm
EBITDA before special items
DKKm
Cash and cash equivalents
DKKm
242.5% growth vs. 2021
30.6
(108.4)
(89.9)
29.4
8.9
(93.7)
(74.8)
143.3
5.5
(85.8)
(67.5)
1.5
In line with communicated guidance for the
year, Aquaporin’s full-year 2022 revenue
amounted to DKK 30.6 million. Revenue was
driven by repeat sales and a growing
customer base in all business areas, with
Drinking Water taking the lead with an
256.9% revenue increase to DKK 23.0
million. Both Industrial Water and Food &
Beverage showed positive traction with
revenue increases of respectively 123.8%
and 636.8% compared to the same period
last year.
2022 EBITDA impacted by provisions for
product replacements, write-down on
slow-moving inventory, the full-year cost
impact from 2021 new hires, and the full-year
cost of being listed on Nasdaq Copenhagen.
In February 2023, the Company raised gross
proceeds of DKK 74 million, which will serve
to fund the Company’s growth strategy in
2023 and beyond.
30.6 (89.9)
(108.4)29.4
Industrial Water
DKKm 4.7
Food & Beverage
DKKm 2.9
Revenue split on business areas
Drinking Water
DKKm 23.0
75%
15%
10%
Aquaporin
Annual Report 2022
01 Commentary 9
DKK 1,000 2022 2021 2020 2019 2018
Income statement
Product sales 30,554 8,922 2,709 2,314 1,605
Strategic Commercial Partnerships - - 2,790 3,764 6,289
Total net revenue 30,554 8,922 5,499 6,078 7,894
Distribution costs 16,376 6,394 - - -
Sales and marketing costs 26,220 27,553 20,811 19,948 16,784
Research and development costs 49,862 45,331 56,072 57,198 51,614
Administrative costs 21,461 17,823 13,059 17,660 16,471
EBITDA before special items (89,918) (74,842) (67,515) (72,427) (62,163)
EBITDA before special items
normalized
1
(85,186) (74,842) (67,515) (72,427) (62,163)
EBIT before special items (108,384) (93,728) (85,869) (89,419) (77,160)
Special items (5,007) (37,319) - - -
Operating profit (EBIT) (113,391) (131,047) (85,869) (89,419) (77,160)
Net financial items (4,087) (4,550) (3,467) (3,664) (3,006)
Earnings for the period (112,119) (131,774) (123,356) (70,629) (71,573)
Balance sheet
Total non-current assets 203,263 204,542 214,017 256,558 233,889
Total current assets 67,283 180,804 32,799 32,898 33,335
Total assets 270,546 385,346 246,816 289,456 267,224
Equity 159,135 270,475 107,322 164,062 110,819
Total liabilities 111,411 114,871 139,494 125,394 156,405
1) EBITDA normalized: EBITDA being adjusted for special items and other unusual or non-recurring items.
DKK 1,000 2022 2021 2020 2019 2018
Cash flow
Cash flow from operating activities (94,942) (115,189) (59,027) (64,064) (78,062)
Cash flow from investment activities (11,404) (9,769) (16,723) (22,357) (14,091)
- Investments in intangible assets (9,728) (9,149) (12,162) (13,814) (7,641)
- Investments in tangible assets (1,403) (557) (4,557) (8,674) (3,062)
- Investments in associates and joint
arrangements - - - - (3,326)
Cash flow from financing activities (7,562) 266,660 75,790 86,684 46,870
Key ratios*
Equity share 59% 70% 43% 57% 41%
Earnings per share (11) (14) (15) (10) (10)
Diluted earnings per share (11) (14) (15) (10) (10)
Average number of FTE’s 86 78 83 83 73
*Key figures and ratios are defined and calculated in accordance with applied accounting policies.
Key figures
Aquaporin
Annual Report 2022
01 Commentary 10
April
May
May
June
July
November
August
Key events 2022
Company announcement Press release
Secured strategic Industrial Water
partnership for North America with
Forward Water Technologies
Reinforced Aquaporin’s
Executive Management
team with the appointment
of Klaus Juhl Wulff as
Chief Financial Officer
Initiated partnership with
Flavourtech to deliver
high-quality natural aromas
in the aroma and coffee
extraction segments
Announced joint venture with Danish
Aerospace Company: Danish Astronaut,
Andreas Mogensen, will be going into
space in 2023, to, amongst other, test
the Aquaporin Inside® technology in FO
and membrane distillation at the
International Space Station
Data from Aarhus
University show that
Aquaporin’s core
technology, Aquaporin
Inside®, removes
>99.9% of the forever
chemical, PFAS, from
drinking water
Sold first Forward Osmosis
system to E. & J. Gallo
Winery, one of the most
prominent global players in
the alcoholic beverage
industry
Launched water purifier with
Turkish home appliance
manufacturer, Vestel, scaling
up Aquaporin’s commercial
footprint in Turkey
Announced collaboration on
novel desalination and
wastewater project with
University of Las Palmas de
Gran Canaria to develop an
innovative Forward Osmosis
pilot
Aquaporin
Annual Report 2022
01 Commentary 11
Executive Management team
From left to right
Peter Holme Jensen
Founder & Chief Innovation Officer
Klaus Juhl Wulff
Chief Financial Officer
Matt Boczkowski
Chief Executive Officer
Joerg Hess
Chief Operating Officer
Without Aquaporin, there
would be no life on earth
Rethinking water filtration with biotechnology
Aquaporin
Annual Report 2022
01 Commentary 12
Our strategy coming to life
Promote
sustainability
in everything
we do
Advance game-
changing protein
technology
Commercialize
products &
solutions
Grow and scale
with partners
Continue to
innovate
Focus on sustainability as a
core part of our value to
customers
Commitment to drive change
and solve water scarcity
Drive energy efficiency and
water preservation
Ensure full transparency
with external stakeholders
Grow brand value of Aquaporin
Inside® through co-branding
with key accounts in Drinking
Water
Focus on key applications with a
unique selling proposition in
Industrial Water
Focus on delivering solutions to
specialty applications and
blue-chip brands in Food &
Beverage
Anchor all our activities in a
focused customer-first mentality
and approach
Invest in commercial resources
and branding to generate strong
market demand for our solutions
Develop commercial engineering
to support our expansion into
solutions and services
Use contract manufacturing to
scale fast with low capex
investment
Focus on our core
competences and benefit from
best-in-class partners
Increase local presence in key
geographies
Prioritize exclusivity in most
significant win-win partnerships
Continue to develop and
refine our core technology
– Aquaporin Inside®
Focus on technology
scouting to complement our
current portfolio
Drive Open Innovation
development partnerships
Leverage existing
technological foundation to
develop next generation
biotech solutions
Aquaporin
Annual Report 2022
02 Our business 14
Our values
We commit to our
costumers who
determine our
success
We focus
on key
applications
to drive
growth
We dare
to look for
new ways
to break the
status-quo
We collaborate with
our stakeholaders to
make a difference
We empower
each other
to act with
passion and
responsibility
Aquaporin
Annual Report 2022
02 Our business 15
Business model
In each of our business areas, we apply a customer
first strategy and we drive execution by leveraging
our unique core Aquaporin Inside® technology.
We focus on collaborations with customers
and strategic partners to develop products
and solutions for targeted applications. This
approach ensures that value creation begins
at the end-user within each business area
and works its way back to our R&D efforts.
We operate an asset-light production to
enhance agility and focus on core
capabilities, keeping only the most value-
adding production steps in-house. Our main
in-house production priority is the Aquaporin
Inside® technology. One part is the
formulation for which we have successfully
established large scale production.
Membrane coating with Aquaporin Inside®
technology is either applied at Contract
Manufacturing Organizations (“CMO”) or at
our production facility in Lyngby, Denmark.
Our CMO relationships are founded on close
co-development of membranes to support
the Aquaporin Inside® technology and
optimize performance. Our selection process
for CMOs is based on comprehensive
technical, financial, geographic, and
common values criteria. This approach allows
us to scale without the need for large-scale
investments.
Strong
R&D focus
Asset-light
operations
Targeted
value creation
Idea generation
Our early stage ideation
relies on idea intake and
innovation, working closely with
stakeholders to develop
solutions to global challenges.
Research
We invest time and capital in
our research to develop more
sustainable products.
Prototyping
We work closely with our
partners to optimize solutions
for a better environmental
footprint.
Our business areas are aligned with the
UN SDGs and seek to solve some of the
most critical challenges pertaining to
water quality and scarcity.
Sourcing
We work closely with our suppliers to
ensure responsible sourcing of our
product components.
System
integration
Contract
Manufacturing
Organizations
Production
Inhouse
Drinking Water
Industrial Water
Food & Beverage
Ongoing feedback
Forward osmosis
& reverse osmosis
Reverse osmosis
Aquaporin
Annual Report 2022
02 Our business 16
Core technology
Aquaporin Inside® is the technology that drives all our
products. Put simply, it’s a biomimetic membrane that
incorporates aquaporin proteins to filter water faster and
more energy-efficiently.
Gene from e.g. plant,
yeast or other organism
Production organism Production organism
making the protein
Waste (spent medium,
production organism, DNA)
Purified protein
Purified protein incorporated into Aquaporin Inside®
Forward Osmosis and
Reverse Osmosis products
Flat sheet, hollow fiber, reverse osmosis,
and forward osmosis. All our membranes use
Aquaporin Inside® to purify and clean water,
and they are revolutionizing water treatment
– in industries, homes, and even in space.
The Aquaporin Inside® technology
incorporates aquaporin proteins to replicate
nature’s own water filtration process.
Specialist water channels, aquaporin proteins
exist in the membrane of all living cells. They
can be found in every living organism, from
plants and animals to human beings, and are
essential to all life on Earth.
Placed within the cell membrane, aquaporin
proteins transport water – and only water
– in and out of the cell. Billions of years of
evolution have made them extremely efficient
and highly selective, like a superhighway for
water. They are far better than any manmade
water filter. One square meter of synthetic
manmade membrane can filter around 50
liters of water per hour. One gram of
aquaporins can filter 700 liters per second,
enabling fast, energy-efficient, and natural
water filtration.
Purified protein production
Aquaporin
Annual Report 2022
02 Our business 17
Technology
Sustainable
Development Goals
Reverse osmosis Forward osmosis
Drinking Water
Point of Use filtration
systems and flat sheets
Industrial Water
Resource recovery and
energy optimization
Food & Beverage
Quality assurance and
reduction of chemicals
Business areas
The Aquaporin Inside® technology has a broad
range of potential applications across industries.
During 2022, we have gained insight that
enables us to conduct a more focused
approach on customer-centric applications
with a unique value proposition to grow our
brand. We provide sustainable, energy-
efficient solutions that help reduce the global
environmental footprint, reducing negative
environmental exposure in the value chain.
Our business is split into three areas with
unique opportunities to create value for
stakeholders. Each business area represents
a differentiated value proposition for our
customers by leveraging our unique core
technology.
Drinking Water is our most mature business
area in which we deliver clean drinking water
to end users through our flat sheet,
membranes, and purifiers. For Aquaporin,
Drinking Water comprises the broadest
portfolio of products and continues to be the
main growth driver near-term. Our go-to-
market strategy is focused on co-branding
and partnerships, utilizing collaborations to
build our customer base.
Within our Industrial Water business area, we
have products launched in the market, but
application maturation requires longer
testing and piloting stages. This is
particularly true in forward osmosis which is
a separation method that is gaining traction
in specific niche applications where
alternative concentration technologies are
too expensive or not able to achieve the
same level of separation.
In Food & Beverage, our Forward Osmosis
solutions allows a concentration of liquids
without loss of quality or flavor, enabling
unique and natural products to be introduced
to consumers. The introduction of new
production processes requires extensive
testing but is expected to grow fast once the
value is demonstrated and accepted by large
brands in niche applications.
Business areas focus
Aquaporin
Annual Report 2022
02 Our business 18
We want Aquaporin Inside® to be at the top of customers’ minds
when they think of a drinking water solution, delivering high quality,
affordable drinking water in a well-designed product.
Strategy
Our Drinking Water solutions enable people to take
water purification into their own hands, avoid pollution
and reduce dependency on bottled water for hydration.
Impact
Key wins in 2022
Near-term focus
Launched water purifier with Turkish home
appliance manufacturer, Vestel, scaling up
Aquaporin’s commercial activities in Turkey,
generating repeat business and emphasizing the
commercial footprint
Grew sales orders significantly with Philips Water
Solutions in China with multiple repeat orders
Advanced dialogues with potential partners and
customers in India, a key market for water treatment
Continue successful launch of A2O Series, including
A2O Pure under-the-sink purifier (launched in
February 2023) and the A2O Bar kitchen unit,
equipped with IoT technology
Support and expand relationships with strategic
partners and key accounts
Grow through a key account strategy
Growing brand awareness is a hallmark of
our Drinking Water strategy, defined through
Danish design, Scandinavian water quality,
and our branding slogans “filtered by nature”
and “water made by nature”. We seek to (co-)
brand “Aquaporin Inside®” in all our products
to increase awareness of our technology. We
believe our brand contributes great value to
our partners, representing high quality
products and innovative technology.
Products are commercialized through our
own range of Point-of-Use (“PoU”) water
purifiers, sale of membranes to major
distributors and original equipment
manufacturers, and co-branding with major
players through the sale of our membrane
flat sheet. We aim to develop relationships
with key strategic partners to drive recurring
revenue channels and ensure alignment in
quality.
Performance
257%
23DKKm
Revenue
Growth vs. 2021
of total revenue
75%
Drinking Water
Strategy and performance
Aquaporin
Annual Report 2022
02 Our business 19
Markets and products
Fresh water scarcity, pollution of ground
water, and resource consumption related to
bottled water is a growing global challenge
that is accelerated by several megatrends.
Global population growth and rising living
standards, coupled with global warming, and
increased focus on water quality increases
the need for water purification systems.
Apart from excellent water filtration, the
Aquaporin Inside® technology has proven to
remove the forever chemical, PFAS, or Poly
and perfluoralkyl manmade substances, from
drinking water. The University of Aarhus has
conducted tests with our water purifier,
containing the Aquaporin Inside® technology
present in all products, confirming that our
technology removes more than 99% of PFAS
via water filtration.
In February 2023, Aquaporin launched the
A2O Pure water purifier, which is an under-
the-sink filtration system serving to remove
toxins such as PFAS from your drinking
water.
We are committed to improving
global access to clean drinking
water and the related
environmental footprint by
bringing water filtration to the
end-user.
Drinking Water
Aquaporin
Annual Report 2022
02 Our business 20
Flat sheet Membranes Purification systems Consumers
Our offerings
We have a full product offering for purification
systems – in addition to own system sales, we
provide Aquaporin Inside® membranes and flat
sheet to third parties.
The filtration technology
offered by Aquaporin
effectively removes
PFAS from drinking
water
The drinking water market consists of
residential, institutional, and municipal
systems, all of which can be addressed with
different technologies. The total addressable
market exceeds DKK 250 billion. Aquaporin’s
addressable segment consists of Reverse
Osmosis-based solutions in the residential
Point-of-Use (“PoU”) segment as well as
Point-of-Entry (POE) and municipal
segments.On a global scale, our addressable
market is estimated at more than DKK 60
billion – including systems and membranes.
The largest geographical markets are in the
Asia-Pacific region, driven by China as the
largest single-country market, representing
approximately 50% of the total global POU
purifier market. North America and Europe
are combined estimated to hold
approximately 40% of the PoU Drinking
Water market.
Drinking Water
Aquaporin
Annual Report 2022
02 Our business 21
Taking on the
PFAS challenge
PFAS is a group of more than 4,700
compounds developed and used since the
1940s. The PFAS chemicals are in a vast array
of products – for instance, cooking
equipment, raincoats, and fire extinguishing
foam, to name a few. Now, the problem is that
PFAS is showing up in drinking water all over
the globe, and people are drinking
contaminated water without having adequate
treatment.
However, these chemicals are hard to break
down in your body and the environment;
rather than disappearing, they accumulate.
As a result, PFAS can migrate into soil, water,
and even air. PFAS is hard to break down in
the environment, and its persistence means
that PFAS can appear in the blood of animals
and humans. Recent research has also
suggested long-lasting exposure could lead to
multiple health concerns.
We face the consequences of the widespread
use of industrial chemicals contaminating our
groundwater. Unfortunately, PFAS
contamination is here to stay, so it is time to
actively seek a way to avoid these “forever
chemicals” infiltrating the body and the
environment.
Taking a stand
PFAS chemicals are believed to be present
in 98-99 percent of all human bodies, and
getting rid of these chemicals is impossible
once you have them in your body. You can,
however, take precautions by using a water
filter that removes PFAS from your drinking
water.
At Aquaporin, we take the challenge of PFAS
and other bacteria, viruses, and heavy metals
very seriously as we strive to ensure we have
the best possible drinking water available.
Recent research suggests that continuous exposure to the
forever chemical PFAS, which can be found in our drinking
water, can lead to various health effects. Our purifiers
equipped with our Aquaporin Inside ® technology remove
more than 99.9% of PFAS from residential drinking water.
Therefore, we have developed two solutions
– the A2O Pure, which launched in February
2023, and the A2O Bar, which is expected to
launch in H1 2023.
The A2O Pure is our under-the-sink solution
that removes PFAS from your drinking water.
A study by Aarhus University highlights how
efficient our proprietary unique Aquaporin
Inside® membrane biotechnology is at removing
PFAS from your drinking water.
The A2O Bar carries the same attributes as the
A2O Pure but is a do-it-all solution that combines
all the modern kitchen units in one innovative
machine. With these two purifiers, Aquaporin is
taking on the PFAS challenge by removing the
damaging forever chemical from your water.
Read more about Aquaporin’s unique technology
and PFAS removal here.
The Aquaporin solution
Aquaporin’s unique proprietary
membrane technology is used
by many companies worldwide.
The list includes:
Philips Water Solutions,
Andersen & Nielsen,
Diamond Drops, and Vestel.
Drinking Water
Aquaporin
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Strategy
Our technology prevents pollution and contamination
of water streams and enables companies to obtain
energy-efficiency in their production processes.
Impact
Key wins in 2022
Announced strategic partnership for North America
with Forward Water Technologies to sell Aquaporin’s
unique Aquaporin Inside® biomimetic Forward
Osmosis membranes for applications associated
with lithium mining and extraction as well as water
management in the oil and gas industry
Expanded potential customer base in Brackish
Water Reverse Osmosis by providing ultra-low
energy membranes for water treatment in the
semiconductor industry
Sold first FO system for the treatment of waste
collection leachate in China
Entered into a collaboration project with the
University of Las Palmas de Gran Canaria to develop
a Forward Osmosis pilot that neutralizes two waste
streams by combining them as part of the same
process
Successful commissioning of first bLEAF
(biomimetic Leachate & Effluent Automatic
Filtration) Forward Osmosis container for leachate
treatment with major Chinese customer
Our Forward Osmosis (“FO”) technology is an
energy-efficient alternative to existing
separation and purification methods, which
can be more capital intensive and require
large upfront investments. Our focus is on
pollution prevention, energy conservation,
and resource recovery. We see a particularly
significant opportunity in applying our FO
technology in extracting valuable fractions
from waste streams to produce sellable
products while simultaneously purifying
water for a safe return to the environment.
Our Reverse osmosis (“RO”) technology
offers high water flow by leveraging
Aquaporin Inside® for increased energy
efficiency. Our products are designed as a
direct replacement for existing membranes
since the reverse osmosis market is well
established and commoditized.
Our commercial strategy is to grow our
installed base via direct sales or through
distributers/OEMs. Over time, we optimize
our sales cycles across applications by
leveraging reference cases and data insights
from prior projects. Through early pilot
projects and technology evaluation
partnerships, we aim to provide membranes
to larger greenfield installations in the future.
Performance
124%
4.7DKKm
Revenue
Growth vs. 2021
of total revenue
15%
Industrial Water
We help customers save water and energy by with our Forward
Osmosis and Reverse Osmosis products and solutions.
Strategy and performance
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Markets and products
Industrial Water
Water is used in most production processes
across all industries. Regardless of the type
of process used, the result is a significant
amount of wastewater generated. Advanced
water filtration technology is required to
either re-use the water in the production
processes or to ensure that these wastewater
streams are cleaned properly before being
released into the environment. The largest
markets for industrial wastewater are in Asia
due to the high proportion of global
production located there, but demand for
solutions is global.
The market is driven by an increasing focus
on sustainability, both from companies’ own
perspectives and from significant tightening
of ESG regulation. An example of this is the
Indian textile industry, where Zero Liquid
Discharge programs have been introduced to
avoid liquid emissions of chemicals into
natural water streams. Going beyond seeing
Waste stream
Filtered water
Draw solution
(Lower concentration)
Draw solution
Concentrated wastewater stream
Forward Osmosis system Reverse Osmosis system
Our products Water handling across industries
wastewater as waste, there is a shift in
certain industries to see it as a resource. In
some cases, we see customers looking at
recovering sellable and high-value items from
wastewater streams. This is the case in the
mining industry, sugar mills, and digestate to
name a few. Opportunities for resource
recovery, a focus on energy efficiency and
government-led sustainability programs
create a strong demand for our filtration
solutions.
Our focus is on select applications within the
broader market, for example, the leachate,
digestate, and textile wastewater, which are
major sources of pollution and have
experienced stricter regulation over a short
period of time, fueling the opportunity for
technology providers to introduce frontier
technologies such as forward osmosis.
Ideal for residential and
commercial drinking
water solutions
Ideal for both commercial
and industrial water
treatment systems
DWRO™ elements
Aquaporin Inside®
CLEAR membranes
Reverse Osmosis (RO)Forward Osmosis (FO)
HFFO®14
Suitable for industrial
installations
Suitable for application
development and pilot trials
Suitable for academia and
application development
HFFO®2
HFFO®6
RO
Aquaporin
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Strategy
Our solutions provide brands with novel and superior
concentration processes and potentially new products.
Membrane concentration also offers a more energy efficient
process and enables less capital-intensive production methods.
Impact
Key wins in 2022
Initiated partnership with Flavourtech to deliver
high-quality natural aromas in the aroma and coffee
extraction segments, utilizing Aquaporin’s unique
technology to push the boundaries of aroma and
flavor retention
Entered into a strategic alliance with Wafilin
Systems and Berghof Membranes, strengthening
Aquaporin’s ability to deliver tailored solutions to the
Food & Beverage industry
Continued application testing and piloting of
Forward Osmosis in niche markets with promising
results in beverage concentration, digestate, and
leachate treatment
We aim to increase product value for our
customers by making superior concentrates.
Our aim is to position our Forward Osmosis
technology as an alternative to evaporation, and
to co-develop new product categories, enabled
by natural concentration. The Food & Beverage
industry is highly innovative with new products
developed or positioned for customers at a high
pace. At the same time, there is a high level of
regulatory barriers to entry given food safety
concerns. It follows that introducing new products
and methods requires us to go through both a
rigorous regulatory process and also a marketing
and branding exercise with our customers.
Whilst developing and selling systems is new,
we have always had a strong know-how and
established capabilities within process and
engineering design. By partnering with
experienced equipment suppliers from the
industry, we can now offer a complete solution
to customers that are adopting the new
technology, making it an easier and safer choice.
The versatility of the Aquaporin Inside® Natural
Concentration technology makes it possible for
customers to create a fully customized process
design from a standard system with few add-on
options.
Performance
637%
2.9DKKm
Revenue
Growth vs. 2021
of total revenue
10%
Food & Beverage
Our goal is to provide customers with complete Forward Osmosis
solutions, along with our unique Aquaporin Inside® membranes and
process know-how, allowing customers to produce more efficiently
and to launch exciting new and natural products to consumers.
Strategy and performance
Aquaporin
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Food & Beverage
Markets and products
The global Food & Beverage (“F&B”) market
for filtration systems is well established and
growing, supported by megatrends that are
increasing the demand for high-quality,
natural products. Our focus is to
commercialize FO solutions for concentration
of liquid foods, starting with flavors,
ingredients, and coffee.
Concentration is a widely used process
technology to preserve and distribute food
products from where it is cultivated, to the
hands of the consumer. This often means
costly and energy-demanding supply chains
or compromises in taste or quality due to
limitations in currently available technology.
Today’s prevalent concentration technology
Natural concentration allows for improving the quality of existing
products, but also enables new product development through
higher flavor and aroma retention, with our Aquaporin Inside
technology®.
is evaporation, using heat to remove water
from other compounds. These processes are
energy-intensive, remove the natural aromas,
and irreversibly change the taste of the
product. With the use of the Aquaporin
Inside® FO membranes and processing
know-how, it is now possible to have an
easy-to-use, membrane-based cold-
concentration process that protects natural
aromas and quality during processing. We
call it Aquaporin Inside® Natural
Concentration.
Our goal in F&B is to enable food producers
and brands to create high-quality products as
close to the original natural product as
possible.
Coffee concentration process
Beans are harvested,
roasted and brewed into
fresh coffee ...
… but next steps determine how
much quality is retained in the
coffee concentration.
Instant & professional
cold brew
Ready to drink
coffee products
Instant
coffee
Low quality
High quality
Aquaporin Inside®
Natural Concentration
Aroma retention
New product
categories
Existing product
categories
Concentration through
evaporation
The Aquaporin value-add
in coffee concentration
Using cold concentration as
an alternative to traditional
evaporation in coffee
concentration processes
greatly improves the quality
by increasing the retention
of natural tastes and aromas
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Research &
development
Comprehensive research & development is
essential to fully utilizing the unique properties
of our Aquaporin Inside® technology.
Research & development continues to be the
foundation of our company and is essential in
fully utilizing the unique properties of our
Aquaporin Inside® technology.
We continue to invest in our research and in
developing better products for continued
commercial growth in the future. These
efforts are split between our development
team, who works in close collaboration with
our commercial business areas to tailor
solutions, and our research team, who
focuses on improving our core technologies
and early-stage research into potential new
application areas. In addition, our research
department is responsible for the
development of alternative and more
sustainable ways in our membrane
manufacturing to continuously decrease the
footprint of our products.
Our Deep Tech team focuses its efforts on
developing the next generation of our
Aquaporin Inside® formulation. This
biomimicry technology is central in our value
proposition of using biotechnology to drive
innovation in the water treatment industry
and we are extremely proud of the
milestones and technological convergence
this has unlocked to date. We see the
potential of the technology being even
greater and seek to improve our formulation
to create higher energy efficiency, water flux,
and rejection rates of unwanted pollutants in
our drinking water, such as PFAS, which
today has become a global challenge.
Our close interaction with end users through
pilot testing and commercial partnerships
creates valuable insights for our research
and guides our development focus. It
reinforces our company culture through
close internal collaboration across
departments and ensures high levels of
efficiency in application development.
Key developments in 2022
Development of next level state-of-
the-art Point of Use water purifiers
for Drinking Water, securing launch of
the A2O Pure and the A2O Bar
products in 2023
BBC World Water Series episode
launched, focusing on PFAS removal
from drinking water
Superior PFAS data on our drinking
water products, produced together
with Aarhus University
6 new public-private partnerships
secured, with valuable collaboration
partners in all parts of the value chain
2 successful patent filings
Secured European Space Agency
flight tests on Aquaporin Inside®
technology to come in 2023
Utilization of Aquaporin Inside®
membranes in space for Water
Recovery Unit (WRU) in collaboration
with the European Space Agency
Incorporated machine learning to
optimize product development from
lab to production scale
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Open Innovation
Aquaporin was founded on scientific
collaborations and open innovation is a tool in our
technology development. We engage with the
surrounding society to innovate, to develop our
organization, to secure funding, and to play our
part in creating a circular research ecosystem.
Our focus areas within Open Innovation:
Public-private partnerships
We work with academic and private research institutions to solve
challenges through co-creation and co-funding.
In-house open innovation
We share our office space and laboratories with students and
start-ups to unlock their potential and allow them to take part in our
innovative water technology research. As a bonus, it provides us with
a pipeline of young talent. Approximately 15% of the 135 students
who have participated have transitioned into full-time positions at
Aquaporin.
DeepTech
In public-private partnerships and other Open Innovation activities we
engage in, the competences and capabilities of our DeepTech
department is an essential enabler for Aquaporin in being a valued
and desired collaboration partner on a global scale.
As the company embarked on a commercial
journey, it was important to create a structure
where Open Innovation could continue to
thrive at Aquaporin. Many of the company
successes stem from successful innovation
partnerships and co-development projects,
which we want to continue growing in the
future as we take on new challenges that
require a long-term research and
development focus.
Through future initiatives that will be
anchored in Open Innovation, we aim to
ensure that we develop our talent, secure
funding for our development and play our
part in creating a circular research
ecosystem. We believe that giving Open
Innovation a clearly defined focus will
reaffirm, formalize, and structure our work to
ensure sustained progress in many areas of
Open Innovation.
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“ Our collaboration with Danish Aerospace
Company within the Aquaporin Space
Alliance is truly inspiring, and projects
such as these are driving innovation, not
only for applications in space, but also
within Aquaporin for our membrane and
application development.”
Jörg Vogel
VP of Open Innovation
Aquaporin x NASA
Transporting water is expensive. Taking it to
space, even more so. With the Aquaporin
Inside® technology, NASA will be able to
recycle condensation from within the space
shuttle, sweat from space suits, and the
astronauts’ urine, filtering it through the
Aquaporin Inside® membrane, creating
drinking water. Danish astronaut Andreas
Mogensen first tested Aquaporin Inside® in
orbit at the International Space Station, ISS,
in 2015. In 2023, Aquaporin will once again
join Andreas Mogensen on his journey into
space.
In 2010, the space organization,
NASA, became Aquaporin’s first
paying customer, with the aim to
test the Aquaporin technology
by recycling water in space.
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Outlook for 2023
For 2023, we expect to see continued revenue
growth across all segments, including Drinking
Water, Industrial Water, and Food & Beverage.
For the full year 2023, we estimate revenue
to be in the range of DKK 50-70 million, and
gross profit to be at least 30%. Revenue is
expected to primarily be driven by Drinking
Water (70-80%), where we continue to
expand the Aquaporin Inside® brand through
our (co-)branding strategy and partnerships
with large global customers and key
accounts, capitalizing on a strong yearly
global market growth of ~10% in the purifier
segment. During 2022, PFAS, or Per- and
polyfluoroalkyl substances, became an
often-covered topic in media worldwide, with
an increasing demand for solutions to
remove the forever chemical from drinking
water. A study conducted by Aarhus
University in 2022 demonstrated that water
purifiers containing the Aquaporin Inside®
membrane remove 99.9% of PFAS. In
February 2023, the Company launched the
A2O Pure, an under-the-sink drinking water
purifier, and plans to launch the A2O Kitchen
Bar, a built-in purifier, in H1 2023. Along with
the existing Aquaporin product line, both
A2O purifiers remove PFAS, bacteria,
pesticides, and viruses. The collaboration
with Phillips Water Solutions and the A2O
Series launch are expected to drive solid
revenue growth in 2023 and beyond.
We expect Industrial Water and Food &
Beverage to contribute 20-30% of the
full-year revenue in 2023. In 2022, we sold
and delivered two small-scale Forward
Osmosis pilot systems in Industrial Water and
Food & Beverage, respectively, which could
generate further revenue opportunities in the
coming years. In addition, we anticipate
growing our partnerships and continue to
investigate new growth opportunities.
Ensuring that we deliver on our strategy in
2023 requires clear and deliberate capital
allocation choices and investments.
Therefore, we expect to increase our
marketing and commercial resources in
Drinking Water where growing brand
awareness is essential to position Aquaporin
Inside® with resellers and end-consumers.
We will continue to develop products for
other categories based on specific projects
with partners, mainly focusing on our
Forward Osmosis technology. We plan to
continue investing in R&D with a clear
short-term objective of developing the
next-generation Reverse Osmosis and
Forward Osmosis membranes, based on our
Aquaporin Inside® technology.
Through Open Innovation, we are identifying
new collaborations and partnerships that
have the potential to provide ground-
breaking solutions to the water industry.
These endeavors are a part of our long-term
strategy and are in line with our ambition to
leverage our core technology to tackle health
and environmental challenges with our
unique technology.
To reinforce Aquaporin as we grow, we will
continue to invest in training, people
development, commercial staff, IT systems,
and business tools. In 2023, we plan to keep
the overall headcount in line with the 2022
headcount. For 2023, we expect EBITDA of
negative DKK 105-95 million before special
items, which is 7.6% (mid-range) lower than
the same period in 2022. As of the time of
publication of this report, we do not expect
any special items in 2023. Investments
(CAPEX) for the year is expected to be DKK
10-15 million in 2023.
Our financial financial guidance takes into
account the uncertainty characterizing the
global economy, mainly driven directly or
indirectly by the war in Ukraine, and rising
inflation, especially in Western Europe and
the United State. A worsening of the
economic climate will likely also impact our
business in 2023.
In February 2023, Aquaporin raised gross
proceeds of DKK 74 million, which will serve
to fund the journey in 2023 and beyond.
In addition, the Company is continuously in
active discussions with potential investors
and third parties regarding raising additional
equity or debt financing in the short term to
finance growing the business and further
commercializing operations until such
operations are cash positive, which is
currently expected within the next few years.
2023 financial guidance
Unit 2023 guidance
Revenue DKKm
50-70
Gross profit %
>30
EBIT* DKKm (105)-(95)
CAPEX DKKm
10-15
*before special items.
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ESG matrix, page 46
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Social & employees, page 39
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Towards a more
circular approach
We want to take
responsibility for
our entire product
cycle.
With innovation and R&D, we continue to
improve the performance of our membranes
and extend the operational lifetime. However,
membranes are complex and resource-heavy
to produce and, unfortunately, most used
membranes end up being incinerated or in
landfills.
Currently, Aquaporin has no experience with
upcycling, remanufacturing, or reselling
pre-owned products. We know that solving
the post-life issue would make an immense
difference for the environment, and therefore
we continue to do our best to tackle this
challenge.
Integrating circular thinking in the way we
work is a key company objective and, since
2021, we have been working with the
EU-funded Green Circular Transition
program. The result was a take-back model
mapping a system, where membranes could
potentially be recycled.
We continue to use this model to compare
environmental costs and economic benefits
of taking back products and potentially
remanufacturing or reusing parts in the
future. We are aware that solving the
problem of waste is a challenging task,
however we insist that data and innovation
will drive this agenda and hopefully we can
contribute to addressing this challenge in the
future.
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Health & safety, page 40
Sustainability targets, page 47
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Our responsibility
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03 Sustainability 41
We see access to clean
water and sanitation as
a basic human right.
We are working to
secure access to and
promote rights to clean
water.
Our drinking water solutions ensure that households, schools, and
workplaces can have clean drinking water, cleared for Perfluoroalkyl
and Polyfluoroalkyl Substances (PFAS), bacteria, pesticides, and
viruses.
Through partnership with e.g. Phillips Water Systems in China our
drinking water solutions will be securing clean and healthy drinking
water in more than 140,000 homes. At the end of 2023 the number
of homes getting clean drinking water from Aquaporin’s solutions is
expected to be more than 500,000.
In addition, we work with a partner in India to secure clean and healthy
drinking water in schools and local sports hostels by installing our water
purifiers. By the end of 2022 there will be installed 300 systems in
India, and this number will increase to above 1,000 during 2023.
We are working together with the University of Las Palmas de Gran
Canaria, and Canary Islands Institute of Technology to combine
desalination and wastewater treatment to ensure sufficient clean water
supplies.
Desalination brine is a significant challenge to marine life, and a shared
project is focused on removing the concentrated desalination brine from
the ocean and using it to filtrate wastewater.
Our goal to secure clean and healthy drinking water also brings a strong
focus on health.
Our Aquaporin Inside® membranes are documented by Aarhus
University to remove all Perfluoroalkyl and Polyfluoroalkyl Substances
(PFAS). PFAS are a forever chemical that accumulate in human bodies
and are believed to cause cancer, liver damage, decreased fertility, and
increased risk of asthma and thyroid disease. With more than 140,000
households Worldwide with a water filtration system with Aquaporin
Inside® by the end of 2022, and an anticipated 500,000 by the end of
2023, means that Aquaporin is ensuring that PFAS, bacteria, pesticides,
and viruses are removed from drinking water, hence contributing to
good health and wellbeing.
Further, we are working closely together with two of the world-leading
hemodialysis solution producers to improve the hemodialysis process
with a more energy-efficient, portable solition that patients can operate
at home. This will add significantly to the life quality of hemodialysis
patients. These solutions are still in the early stage, but something
Aquaporin is focusing on and hope to succeed with.
Securing clean, healthy water Potential health benefits associated
with clean water
Our impact
Social & employees
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Governance
Diligent governance is key to
ensure a sustainable business in
compliance with relevant
regulations.
There are several key aspects to governance at
Aquaporin – our general governance practices,
which relate to how we operate the business,
including anti-corruption & bribery.
Read more about Corporate Governance,
including Executive Management and Board of
Directors, governance structure, and ownership
in Section 04, page 49.
At Aquaporin, we promote an ethical business
environment. Subsequently, we have a zero-tolerance
policy on anti-corruption and bribery, and aim to
ensure our business practices comply with all relevant
laws and regulations.
Given our extensive global supply chain, there are
potential risks of corruption and bribery within our
business. These are described in more detail under
Risk management on page 53.
Anti-corruption & bribery
Corporate governance, pages 49-52 Mitigating actions and 2022 results, page 44
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Our responsibility
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ESG matrix
Unit 2022 2021 2020 2019
Environment
Direct GhG emissions (Scope 1) Tons CO
2
e 285 331 396 437
Indirect GhG emissions (Scope 2 - electricity) - location-based* Tons CO
2
e 76 111
Indirect GhG emissions (Scope 2 - electricity) - market-based Tons CO
2
e 178 202 239 311
Electricity consumption Megawatt hours 443 545 647 849
Natural gas (heating) m
3
124,570 145,868 173,234 187,060
Renewable energy share (scope 2)** % 68% 58% 66% 59%
Water consumption m
3
3,439 5,471 5,319 6,653
Social data
Full time workforce FTE 86 78 83 83
Gender diversity (percentage female) % 38% 39% 37% 41%
Gender diversity in management (percentage female)*** % 13% 17% 18% 19%
National diversity (number of nationalities) Absolute number 24 24 23 21
Employee turnover ratio % 25% 18% 30% 16%
Sickness absence Days per FTE annually 4.5 3.76 3.7 5.72
Total incidents (stop-work orders) Absolute number 0 2 3 1
Lost time incident rate (LTIR) % 0% 0% 0% 0%
Governance
Gender diversity, Board of Directors % 14% 13% 22% 22%
Nationality diversity, Board of Directors % 29% 25% 22% 22%
CEO pay ratio Ratio 7.30 7.79 3.65 4.74
Notes
Emissions. Scope 1 emissions are direct emissions from owned or controlled sources. Scope 2 emissions are indirect emissions from electricity displayed using both location-based method and market-based method. Our location-based method reports on the actual energy
grid mix at the time of consumption and is sourced from Reel, who has calculated our real-time energy emissions based on hourly data in Denmark from 2019 - 2022. For emissions using the market-based method, we used the emissions equivalent from Energinet’s energy
standard factors updated yearly. For Singapore, we used emission factors from the International Energy Agency (IEA). Renewable energy share: Singapore data is not included in this number. Water usage: Excludes US office. For more details on how we calculate our ESG
data, please refer to Glossary on page 48.
* Data from Singapore is based on market-based methodology
** Data from the Singapore office is not included in this number
*** Management is here defined as Executive Management and Managers reporting to Executive Management
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Environment
Emissions 20% reduction in scope 1 (direct greenhouse gas) emissions by 2030
Energy consumption 5% yearly reduction in MWh/FTE
Employee turnover Reduce volunteer leavers to <15% by 2024
Accidents
Class 1 (accidents causing death or serious deterioration) maintain at 0%
Class 2 (all other accidents reported to WEA) to below 0.1%
Class 3 (all other accidents) of below 1%
Incidents Below 5 total stop-work orders in the relevant year
Absence Maintain absence due to sickness at <5%
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Glossary
Environment & Climate
Scope 1 emissions
are direct emissions from owned or
controlled sources.
Scope 2 emissions
are indirect emissions from electricity
displayed using both location-based method
and market-based method. Our location-
based method reports on the actual energy
grid mix at the time of consumption and is
sourced from Reel, who have calculated our
real time energy emissions based on hourly
data in Denmark from 2019 - 2022. For
emissions using the market-based method,
we used the emissions equivalent from
Energinet’s energy standard factors updated
yearly. For Singapore, we used emission
factors from the International Energy Agency
(IEA).
Social & Employee
Full-time workforce
is calculated as the average number of FTEs.
In Denmark, average FTEs = annual total
payments to ATP / the standard rate paid to
ATP for each employee. For Singapore and
the USA, average FTEs = all full-time
employees and trainees relative to their
period of employment for the year.
Gender diversity (all employees, Board and
Management)
is calculated as the percentage (%) of
under-represented employees (women) to
total employees employed as of December
31, 2022.
Gender diversity at the management-level is
calculated as the percentage (%)
of under-represented gender amongst
managers (women) to total managers
employed as of December 31, 2022.
Managers are categorized as employees with
leadership responsibilities and a minimum of
one [reporting] employee.
Employee turnover
rate is calculated as the year-over-year
change for FTEs.
Absence due to sickness
is calculated as an annual percentage,
defined as all days absent reported as sick
leave in our system for registering sick leave
to the total number of workdays a year.
Lost time incident rate (LTIR) per 1000
working hours
includes incidents categorized as either class
1 or 2 accidents. Working hours are defined
from average number of FTEs and the
estimated average working hours.
Accident-free time (AFT)
is reported as the total number of days since
the last accident occurrence in class 1 or 2.
Governance
Board diversity on gender
is calculated as percentage of under-
represented gender (women) to total
members in the Board of Directors.
Board diversity on nationality
is calculated as percentage of non-Danish
members to total members in the Board of
Directors.
CEO pay
ratio is calculated as the ratio between the
CEO salary (including cash bonuses and
excluding pension and warrant programs) to
the median FTE compensation as of
December 31, 2022.
Aquaporin
Annual Report 2022
03 Sustainability 48
Aquaporin
Annual Report 2022
04 Governance 50
Corporate governance
Aquaporin
Annual Report 2022
04 Governance 51
Corporate governance
Board of Directors
Aquaporin
Annual Report 2022
04 Governance 52
analyses on a half-year basis. The risk
overview is presented to the Audit
Committee, who discusses the risk situation
and decides on further mitigating actions.
The process of identifying, handling, and
reporting risks is continuously addressed by
the Audit Committee to ensure that the
underlying risk identification methodology is
appropriate and that it reflects the current
risk picture.
Internal control
Risk management and internal controls
related to financial reporting are designed to
limit the risk of material misstatements.
Standard procedures for the month-end
closing process are implemented to ensure
an in-depth analysis of potential deviations
between actual performance, business plans,
budgets, and quarterly estimate updates.
Commercial risk
Aquaporin is highly dependent on delivering
relevant and value-creating solutions to
customers and end users. The Company has
established a global sales organization as it is
important to understand regional preferences
Managing risks rigorously and systematically is key for us to
create and protect value, short, medium, and long term. This
requires a shared understanding of our risk exposure across
the organization. In consequence of working as a sustainable
business, we must anticipate and adapt to our surrounding
environment to create new strategic opportunities.
and to build value creating solutions for all
customers. If the Company fails to deliver on
quality and stability, the potential downside of
losing customers and not growing our
business increases.
Product supply and product safety
The main risk is the dependency on third
parties for manufacturing product
components and the supply of raw materials,
semi-finished and finished goods. If such
third-party manufacturers or suppliers do not
deliver their products or services in time, it
could have adverse effects on the ability to
service customers. To the extent possible,
Aquaporin prioritizes a preventative approach
to secure dual suppliers for critical products
and inventory management, including
build-up of contingency inventories of critical
raw materials. The highest product safety is
ensured through an extensive quality
assurance program covering the entire value
chain. Production and manufacturing
processes are subject to periodic and routine
inspections to ensure that production and
product quality standards are met.
Aquaporin’s product safety program is
certified according to internationally
recognized standards, including ISO
9001:2015 and NSF.
Health, safety, and security
Risks associated with health and safety at
Aquaporin mainly relate to ergonomic and
physical hazards. Aquaporin’s business is a
low intense production with limited manual
interaction, noise, smell, and vibration. The
Company is committed to ensuring a healthy
psychosocial and physical working
environment for its employees and has
implemented several initiatives to underline
the importance of a safe working
environment. Incidents are monitored and
handled both on department and Executive
Management level.
Intellectual property rights
Aquaporin maintains a proactive patent
strategy and protects new knowledge created
to support the business. Aquaporin actively
monitors third party patent positions within
our relevant fields to secure freedom-to-
operate for our products and technologies.
Aquaporin currently has 18 granted patents
within 14 different patent families.
Financial risk
Due to the nature of its operations,
investments, and financing, Aquaporin is
exposed to risks related to currencies,
funding, liquidity, credit, and counterparties.
Aquaporin aims to actively address financial
risks to mitigate potential material impacts on
the Group’s financial position. The financial
risks are managed centrally with an objective
to reduce the impact and sensitivity on
earnings from fluctuations in exchange rates,
interest rates and liquidity.
Risk governance structure
Aquaporin has a strong focus on risk
management to ensure that it remains an
integrated part of our decision-making. The
Board of Directors holds the final
responsibility for risk management in the
Aquaporin Group and determines the overall
framework for identifying and mitigating risks.
The Audit Committee supervises compliance
within the agreed risk management strategy.
The Executive Management is responsible for
the day-to-day implementation of risk-
mitigating actions as well as the continuous
development of risk management activities to
ensure a proactive approach to potential risk
scenarios.
Our risk management process
Each quarter, the Executive Management
performs a risk analysis. While conducting
these analyses, we identify and define
Aquaporin’s gross risks to ensure an updated
risk overview. Each risk is described, and
potential risk mitigating actions are
discussed. In addition, all Group departments
are involved in performing bottom-up risk
Risk management
Aquaporin
Annual Report 2022
04 Governance 53
50
75
100
125
150
Jan
Aquaporin
Feb Mar MayApr Sep NovOctAugJulJun Dec
Shareholder information
Share and ownership structure
Aquaporin was listed on the Nasdaq
Copenhagen stock exchange on June 28,
2021. The total number of shares as of
December 31, 2022 was 10,130,801. The
company does not hold treasury shares. The
company has one share class, with each
share representing one vote in company
matters. On February 21, 2023, Aquaporin
completed a capital increase, resulting in the
total number of shares being 10,946,154.
The shareholders have authorized the Board
of Directors to issue new shares and
warrants, in accordance with the Articles of
Association.
Our share price closed at DKK 72 on the last
day of trading in the financial year 2022,
representing a 35% decrease in share price
compared to the share price on the last day
of trading in the financial year 2021. In the
same period, the OMX Copenhagen C25
index fell by 13%.
In total, Aquaporin had 2,868 name-
registered shareholders* as of December 31,
2022. Aquaporin has received notifications
of holdings of 5% or more of the share
capital or voting rights from the following 4
shareholders as of December 31, 2022:
M. Goldschmidt Capital A/S
Danica Pension, Livsforsikringsaktieselskab
InterChina Water Treatment Hong Kong
Company Ltd
VP Capital N.V.
On March 7, 2023, Topsøe Holding A/S
became a major shareholder.
Shareholder return policy
Distributions to shareholders are subject to
Board of Directors’ proposals. In February
2023, the Company raised DKK 74 million,
which will be used to fund the ongoing
business on its journey towards profitability.
Share capital (end of year) 10,130,801
Outstanding shares (end of year) 10,130,801
Classes of shares One class
Voting and ownership restrictions Each share has 1 vote
Stock exchange ticker/ISIN AQP/DK0061555109
Market capitalization (end of year) DKK 729,417,672
75%
17%
RoWDenmark Europe
8%
Share price development - January 1 to December 31, 2022
Geographical shareholder split
Aquaporin
Annual Report 2022
04 Governance 54
Executive Management
Matt Boczkowski
Chief Executive Officer (CEO)
Klaus Juhl Wulff
Chief Financial Officer (CFO)
Joerg Hess
Chief Operating Officer (COO)
Peter Holme Jensen
Chief Innovation Officer (CIO)
Nationality Canadian, Polish Danish German Danish
Year of birth 1978 1973 1967 1970
Gender Male Male Male Male
Joined 2021 2022 2019 2005
Other positions and
management duties
No other management positions. Wulff Consulting (Owner) No other management positions. Artefakt Holding ApS (Executive Management),
Aquaporin Space Alliance ApS (Board Member),
Aquapoten Co. Ltd (Board Member), Innovation Fund
Denmark (Board Member).
Qualifications Broad experience in global growth initiatives in both
water and waste treatment with global companies in
senior leadership roles – including Suez and GE Water
& Process Technologies – encompassing corporate
account management, business development,
strategic marketing, technology development and
business management. Holds an MBA from HEC
Montreal, a BEng in Chemical Engineering, and a BSc
in Microbiology and Biotechnology from McGill
University, Canada.
Experience with various growth companies with
exposure to M&A and global business strategy. Brings
extensive knowledge from several corporate finance
functions in international companies which include
positions in FLSmidth, Cobham Satcom, Berendsen
Facility Division, and Stena Recycling. Holds an MSc in
Economics and Business Administration from
University of Aarhus.
Experienced engineering and operations executive
from the water industry, including Siemens Water
Technologies, Mann+Hummel, and SMEs in Australia,
the United States, and Europe. Holds an MBA in
International Marketing from European School of
Business in Reutlingen and an MSc in Civil Engineering
from Technical University Stuttgart.
Founder of Aquaporin in 2005. Instrumental in bringing
Aquaporin from a research-based to a commercial
company, serving as Chief Executive Officer until
2021. Various board member positions held, including
Innovation Fund Denmark. Holds a PhD in Structural
Biochemistry from University of Copenhagen and an
MSc in Biochemistry and Chemistry from University of
Southern Denmark.
Aquaporin
Annual Report 2022
04 Governance 55
Board of Directors
Niels Heering
Chair
Nationality Danish
Year of birth 1955
First elected 2015
Søren Bjørn Hansen
Deputy Chair
Nationality Danish
Year of birth 1972
First elected 2007
Anne Broeng
Board Member
Nationality Danish
Year of birth 1967
First elected 2018
Lars Hansen
Board Member
Nationality Danish
Year of birth 1967
First elected 2015
Independency
assessment
Independent Non-independent Independent Independent
Board committee(s)
Remuneration Committee (Chair)
Nomination Committee (Chair)
Audit Committee (Member)
Remuneration Committee (Member)
Nomination Committee (Member)
Audit Committee (Chair)
Remuneration Committee (Member)
Nomination Committee (Member)
Aquaporin shares as
of December 31, 2022
11,233 14,500 7,491 9,001
Primary position Senior General Counsel, Danske Bank CEO, M. Goldschmidt Holding A/S,
M. Goldschmidt Ejendomme A/S and
M. Goldschmidt Capital A/S
Professional Board Member Executive Director/Chief Executive Officer, Villum
Foundation
Other appointments
and board positions
Chair: Aquaporin Space Alliance ApS, Arborethusene
A/S, Civilingeniør N.T. Rasmussens Fond, Danish
Aerospace Company A/S, Danish Aerospace Medical
Company A/S, JEU Holding ApS, Nesdugaard Holding
ApS (and 1 subsidiary), Viga Re Aps, Viga Re
Management ApS, Holdingselskabet AGIV ApS, and
WAMA Consult ApS
Deputy Chair: 15. Juni Fonden
Member: 15. JF Invest A/S, Global Equestrian Group
Holding ApS (and 1 subsidiary), and Lise og Valdemar
Kählers Familiefond
Other: Managing Director of CCKN Holding
ApS (and 1 subsidiary), Executive management in
Heering Invest ApS and 15. JF Invest A/S
Deputy Chair: Aquaporin Space Alliance, and
Aquapoten Co. Ltd., China
Member: Aquaporin Space Alliance and Aquapoten
Co Ltd., China.
Other: Chief Executive Officer of Atlas Ejendomme
A/S, Komplementarselskabet MGE Frederiksbro II
ApS, MGE16 ApS, MGE Frederiksbro II P/S, Kokkedal
Slot ApS, M. Goldschmidt Ejd., Ringsted ApS, MGE
Frederiksbro II Holding A/S, MGE Frederiksbro ApS,
MGE Hornbæk ApS. Executive Management of SILVER
BEAR HOLDINGS ApS, MGE Marienbergvej 108,
Vordingborg ApS, Slotshotellet ApS, MGE
Trekronergården ApS, MGE13 ApS, MGE14 ApS
Chair: Velliv, Pension & Livsforsikring A/S, and Asta &
Jul. P. Justesen Fond
Member: Rambøll Gruppen A/S, NNIT A/S, VKR
Holding A/S, ATPand Sleep Cycle AB
Other: Special Advisor to NASDAQ Group
Other: None
Special qualifications Extensive board experience from listed and private
companies as well as within capital markets, mergers
& acquisitions, and corporate law, including corporate
governance. Expertise within real estate and the
financial sector along with broad international
experience.
Extensive experience within investments, financing,
and business strategy along with significant
international experience.
Experienced executive with extensive board
knowledge. More than 30 years’ experience in the
financial service industry as Executive Director, CFO,
and Chief Investment Officer. Board experience within
the IT, energy, garment, building material, and retail
sectors and financial services.
Extensive industry experience within biotechnology
along with significant management expertise and
global experience from a large international company.
Aquaporin
Annual Report 2022
04 Governance 56
Board of Directors
Anupam Bhargava
Board Member
Nationality Canadian
Year of birth 1967
First elected 2021
Weiming Jiang
Board Member
Nationality Danish
Year of birth 1956
First elected 2018
Jianlong Zhuang
Board Member
Nationality Chinese
Year of birth 1964
First elected 2021
Independency
assessment
Independent Independent Independent
Board committee(s) - - -
Aquaporin shares as
of December 31, 2022
- 3,167 -
Primary position Executive Vice President, Head of Global Service,
NILFISK
Founder, Shanghai EOS Consulting Company Vice President, Chief Risk Officer and Board Secretary,
Interchina Water Treatment Co. Ltd.
Other appointments
and board positions
None Member: Aptar Group Asia, Huisman B.V.
Other: Operating Partner at GL Capital Group, Advisor
Group (NAG) at Novo Holdings, Advisor to Royal DSM
None
Special qualifications Senior executive with 30 years’ experience
commercializing sustainable technology, deploying
service-based solutions, and introducing new business
models to accelerate market adoption of innovation in
aviation, energy, and water sectors.
Experienced management professional with a global
outlook and experience with the Chinese market.
Extensive experience with biotechnology and the
water sector.
Experienced industry professional and board member.
Extensive experience within water treatment and food
agriculture industries.
Aquaporin
Annual Report 2022
04 Governance 57
Financial
statements
Consolidated
financial statements
05
Financial review
Consolidated income statement
Consolidated statement
of comprehensive income
Consolidated cash flow statement
Consolidated balance sheet
December
Consolidated statement of changes
in equity
Notes to the consolidated
financial statements
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05 Consolidated
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61
Income statement
Revenue
Revenue for the year was DKK 30.6 million
(DKK 8.9 million), an increase of 242.5%. The
increase in revenue was a result of strong
partnerships across all markets. In the Drinking
Water market, the continuous commercial
acceleration and launch of new products
contributes to the increase in revenue. Within
both Industrial Water and Food & Beverage,
there has been an increasing interest in the
Forward Osmosis (FO) technology, which has
materialized in sales of large industrial pilot
systems.
Drinking Water
Revenue in 2022 increased to DKK 23.0 million
(DKK 6.4 million), an increase of 256.9%.
The biggest markets have been Europe and
Asia. The sales in Europe have been off to a
good start with the commercial partnership with
Turkish conglomerate Vestel and was mainly
driven by sales of the point-of-use purifiers.
AquaShield, the global brand partner of Philips
Water Solutions in the water solutions segment,
has been the main driver of the commercial
penetration in the drinking water market
through sales of the Reverse Osmosis (RO)
membrane in Asia.
Industrial Water
Revenue in 2022 was DKK 4.7 million (DKK 2.1
million), an increase of 123.8%.
The revenue was partly generated by large
containerized pilot systems and partly by
product sales from both Hollow Fiber Forward
Osmosis (HFFO) products and Brackish Water
Reverse Osmosis (BWRO) products. The
biggest market was Asia.
Food & Beverage
Revenue in 2022 was DKK 2.9 million (DKK 0.4
million), an increase of 636.7%.
In 2022, the first pilot solution was sold to a
large customer in the US, which has been the
main driver for the revenue generated in 2022.
Additionally, revenue was driven by FO product
sales through pilots and testing services.
Gross profit
Gross profit amounted to DKK 5.5 million (DKK
3.4 million). Mixed margin on product sales for
2022 was 18% (38%).
Gross profit normalized
In 2022 a sale of slow-moving inventory was
made on DKK 1.0 million with 0% gross margin.
Additionally, a provision for the potential
replacement of early modules has been made
on sales totaling DKK 4.7 million impacting cost
of goods sold by negative DKK 2.7 million.
Adjusted for these two factors, the realized
normalized gross margin was 28% (38%).
Operating costs
Operating costs totalled DKK 113.9 million (DKK
97.1 million), an increase of DKK 16.8 million.
The main driver of the cost increase relates to
building the commercial infrastructure,
increasing the distribution and warehousing
function, and the write-down of non-moving
inventory.
Financial review
The financial review is based on the Group’s consolidated
financial information for the year ended December 31,
2022, with comparative 2021 figures for the Group in
brackets.
In 2022, the Group succeeded with the commercial
growth strategy as guided in March 2022 and generated
revenues of DKK 30.6 million compared to a guidance of
DKK 20-30 million. EBITDA before special items was a
loss of DKK 89.9 million compared to a guidance of loss of
DKK 90-100 million, and EBIT before special items was a
loss of DKK 108.4 million compared to a guidance of DKK
105–115 million.
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62
Distribution costs
Distribution costs amounted to DKK 16.4 million
(DKK 6.4 million) The distribution costs
comprise warehousing, procurement, and
logistic functions. It was previously an
integrated part of R&D, supporting the
materials used in development projects. The
function now supports the commercial
activities, which is why the cost is presented
separately. The comparative figures have been
adjusted accordingly to reflect the changed
function of the supply chain infrastructure to
commercial support as of Q4 2021. Additionally,
the increasing costs derives from higher sales
volumes in 2022.
Sales & marketing costs
Sales & marketing costs amounted to DKK 26.2
million (DKK 27.6 million). The decrease is
mainly driven by the reduced costs related to
rotation in the executive management and the
separation of distribution costs. The expansion
of the commercial organization and
infrastructure has been further developed in
2022.
Research and development costs
Research & development (R&D) costs amounted
to DKK 49.9 million (DKK 45.3 million). The
R&D costs are adjusted in relation to the
separation of distribution costs. The increased
costs were driven by increased activities and
resources used for commercial engineering
intended to support sales of pilot solutions.
Administrative costs
Administrative costs amounted to 21.5 million
(DKK 17.8 million). The increased administrative
costs arose partly through strengthening of the
organization to accommodate the requirements
for being a listed company and the cost of being
listed. In addition, the hire of a new Chief
Financial Officer contributed to the increase.
EBITDA before special items
EBITDA before special items amounted to a loss
of DKK 89.9 million (loss of DKK 74.8 million).
Depreciations of tangible assets and
amortization of finished development projects
amounted to DKK 18.5 million (DKK 18.9
million).
EBITDA before special items normalized
EBITDA before special items normalized
amounted to a loss of DKK 85.2 million (loss of
DKK 74.8 million). EBITDA before special items
normalized is a result of one-time costs related
to replacement of first generation point-of-use
systems amounting to DKK 4.7 million.
Special items
Special items were an expense of DKK 5.0
million in 2022 (DKK 37.3 million). In 2022,
inventory intended for the Russian market was
written down. In 2021, special items were
related to the Initial Public Offering (IPO)
completed in June 2021.
Net financial items and shares of associates
Net financial items amounted to DKK -4.1 million
(DKK -4.6 million).
Net financial items comprise interest received
and interest paid, interest component of
payments under finance leases, surcharges and
refunds under Denmark’s on-account tax
scheme, and items denominated in a foreign
currency.
Income tax
Income tax for the year ended December 31,
2022 amounted to an income of DKK 5.4 million
(an income of DKK 5.4 million). An income tax
benefit for both years include a tax credit for
R&D costs at the applicable tax rate under the
Danish Corporate Income Tax Act.
Cash flow
Cash flow from operating activities
Net cash used in operating activities was DKK
94.9 million (DKK 115.2 million). The improved
cash flow from operating activities was primarily
due to the decrease in special items in 2022
compared to 2021 where the costs were driven
by the IPO.
Cash flow from investing activities
Cash flow used for operational investment
activities was DKK 11.4 million (DKK 9.8 million).
The increase was due to both an increase in
development projects and more capital
expenditures used on tangible assets.
Cash flow from financing activities
Net cash provided by financing activities was
negative by DKK 7.6 million (DKK 266.7 million).
The cash from financing activities in 2022 was
mainly driven by repayments of lease liabilities
whereas 2021 was driven by the gross proceeds
from the IPO in June 2021, which amounted to
DKK 250.0 million.
Balance sheet
As of December 31, 2022, the balance sheet
total was DKK 270.5 million (DKK 385.3
million).
Assets
Total non-current assets amounted to DKK
203.3 million (DKK 204.5 million). Intangible
assets amounted to DKK 93.2 million (DKK 89.5
million), an increase of DKK 3.7 million driven by
increased capitalized costs for development
projects. Tangible assets amounted to DKK
107.6 million (DKK 112.9 million), a decrease of
DKK 5.3 million due to depreciations and
reduced capital expenditures. Rights-of-use
assets amounted to DKK 50.2 million (DKK 49.2
million).
Inventory amounted to DKK 10.7 million (DKK
17.6 million), of which finished goods amounted
to DKK 8.3 million, with a majority comprising
Drinking Water products.
Trade receivables amounted to DKK 12.4 million
(DKK 5.2 million), mainly related to Drinking
Water customers.
Aquaporin’s cash and cash equivalents
amounted to DKK 29.4 million (DKK 143.3
million) and are invested in deposit accounts
with highly rated banks.
Equity
Total equity amounted to DKK 159.1 million
(DKK 270.5 million).
Financial review
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05 Consolidated
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63
Consolidated income
statement
DKK 1,000 Note 2022 2021
Net revenue 2.2 30,554 8,922
Cost of goods sold 2.3 (25,019 ) (5,549 )
Gross profit 5,535 3,373
Distribution costs 2.4, 2.5, 5.1, 5.2 (16,376 ) (6,394 )
Sales and marketing costs 2.4, 2.5, 5.1, 5.2 (26,220 ) (27,553 )
Research and development costs 2.4, 2.5, 5.1, 5.2 (49,862 ) (45,331 )
Administrative costs 2.4, 2.5, 5.1, 5.2 (21,461 ) (17,823 )
Operating profit/loss before special items (108,384 ) (93,728 )
Special items 2.6 (5,007 ) (37,319 )
Operating profit/loss (EBIT) (113,391 ) (131,047 )
Share of net earnings of associates 3.4 (23 ) (1,602 )
Finance income 2.7 105 -
Finance costs 2.7 (4,192 ) (4,550 )
Earnings before income tax (117,501 ) (137,199 )
Income tax 2.8 5,382 5,425
Earnings for the period (112,119 ) (131,774 )
Earnings per share in DKK
Earnings per share (11 ) (14 )
Diluted earnings per share (11 ) (14 )
Consolidated statement
of comprehensive income
DKK 1,000 Note 2022 2021
Earnings for the period (112,119 ) (131,774 )
Other comprehensive income
Items that can be reclassified to income statement:
Translation adjustments regarding foreign operations 1,521 366
Other comprehensive income, net of tax 1,521 366
Total comprehensive income (loss) (110,598 ) (131,408 )
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64
Consolidated cash flow statement
DKK 1,000 Note 2022 2021
Operating profit (EBIT) (113,391 ) (131,047 )
Non-cash items 4.2 23,951 26,488
Change in net working capital 4.3 (6,905 ) (6,004 )
Cash flow from primary operating activities (96,345 ) (110,563 )
Received interests and other financial income 105 243
Paid interests and other financial expenses (4,192 ) (4,793 )
Received tax 5,490 (76 )
Cash flow from operating activities (94,942 ) (115,189 )
Investments in intangibles assets (9,728 ) (9,149 )
Investments in tangibles assets (1,403 ) (557 )
Deposits (273 ) (63 )
Cash flow from investing activities (11,404 ) (9,769 )
Credit facility - (28,635 )
Non-current liabilities (1,688 ) 1,801
Repayment of lease liabilities (5,874 ) (3,160 )
Proceeds from sale of tax receivables - 5,367
Proceeds from warrant programs exercised - 45,325
Proceeds from capital increase - 250,000
Cost related to issue of new shares - (4,038 )
Cash flow from financing activities (7,562 ) 266,660
Net cash flow (113,908 ) 141,702
Cash and cash equivalents, beginning of year 143,257 1,504
Currency adjustment of cash and cash equivalents 68 51
Cash and cash equivalents, end of year 29,417 143,257
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05 Consolidated
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65
Consolidated balance sheet December 31
DKK 1,000 Note 2022 2021
Goodwill 3.1 2,899 2,899
Development projects 3.1 89,846 86,255
Other intangibles 3.1 452 313
Total intangible assets 93,197 89,467
Plant and machinery 3.2 38,547 42,547
Right-of-use assets 3.2, 3.3 50,233 49,209
Other equipment 3.2 2,026 2,772
Leasehold improvements 3.2 16,799 18,336
Total tangible assets 107,605 112,864
Investments in associates 3.4 24 47
Deposits 2,437 2,164
Financial assets 2,461 2,211
Total non-current assets 203,263 204,542
Inventories 3.5 10,738 17,593
Trade receivables 3.6 12,430 5,152
Other receivables 4,132 6,396
Income tax receivables 5,500 5,505
Prepayments 5,066 2,901
Cash and cash equivalents 3.7 29,417 143,257
Total current assets 67,283 180,804
Total assets 270,546 385,346
DKK 1,000 Note 2022 2021
Share capital 3.9 10,131 10,131
Retained earnings 3.9 146,693 259,554
Reserve for translation adjustments 3.9 2,311 790
Total equity 159,135 270,475
Lease liability 3.3 52,774 51,739
Other payables 3,596 5,284
Total non-current liabilities 56,370 57,023
Provision 3.10 3,735 111
Lease liability 3.3 4,032 3,077
Prepayments from customers 469 -
Trade payables 3,167 7,214
Other payables 11,003 12,319
Deferred government grants 3.11 32,635 35,127
Total current liabilities 55,041 57,848
Total liabilities 111,411 114,871
Total equity and liabilities 270,546 385,346
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66
Consolidated statement of changes in equity
DKK 1,000 Share capital
Retained
earnings
Reserve for
translation
adjustments Total equity
Balance at December 31, 2020 8,174 98,724 424 107,322
Profit/loss for the period - (131,774 ) - (131,774 )
Other comprehensive income - - 366 366
Total comprehensive income for the period - (131,774 ) 366 (131,408 )
Transactions with owners in their capacity as owners
Increase in share capital 1,957 293,368 - 295,325
IPO costs - (4,038 ) - (4,038 )
Share-based payment - 3,274 - 3,274
Balance at December 31, 2021
Profit/loss for the period - (112,119 ) - (112,119 )
Other comprehensive income - - 1,521 1,521
Total comprehensive income for the period - (112,119 ) 1,521 (110,598 )
Transactions with owners in their capacity as owners
Share-based payment - (742 ) - (742 )
Balance at December 31, 2022 10,131 146,693 2,311 159,135
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05 Consolidated
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67
Section 1
Basis of preparation of
consolidated financial statements
1.1 Significant accounting policies
1.2 Significant accounting estimates and assessments
Section 3
Assets and liabilities
3.1 Intangible assets
3.2 Property, plant, and equipment
3.3 Leases
3.4 Investments in associates
3.5 Inventories
3.6 Trade receivables
3.7 Cash
3.8 Deferred tax
3.9 Equity
3.10 Provision
3.11 Deferred government grants
Section 2
Operating activities
2.1 Segment information
2.2 Net revenue
2.3 Cost of goods sold
2.4 Amortizations and depreciations
2.5 Staff costs
2.6 Special items
2.7 Financial income and expenses
2.8 Income taxes
2.9 Earnings per share
Section 4
Cash, capital structure, & financing
4.1 Financial risks
4.2 Non-cash items
4.3 Changes in net working capital
4.4 Change in financial liabilities
Section 5
Other notes
5.1 Remuneration of the Executive Management
and the Board of Directors
5.2 Shared-based payments
5.3 Fees to auditors
5.4 Commitments and contingent liabilities
5.5 Related parties
5.6 Events after the balance sheet date
5.7 List of Group companies at December 31
Notes to the consolidated
financial statements
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Basis of preparation
of consolidated financial statements
Section 1
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05 Consolidated
financial statements
69
Basis of preparation
of consolidated financial statements
– continued
Section 1
1.1 Significant accounting policies
– continued
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financial statements
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Operating activities
Section 2
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Operating activities – continued
Section 2
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Operating activities – continued
Section 2
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financial statements
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Operating activities – continued
Section 2
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financial statements
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Assets and liabilities
Section 3
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financial statements
75
3.1 Intangible assets – continued
Assets and liabilities – continued
Section 3
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Section 3
Assets and liabilities – continued
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financial statements
77
Section 3
Assets and liabilities – continued
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financial statements
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3.3 Leases – continued
Section 3
Assets and liabilities – continued
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79
3.4 Investments in associates – continued
Section 3
Assets and liabilities – continued
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financial statements
80
3.4 Investments in associates – continued
Section 3
Assets and liabilities – continued
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financial statements
81
Section 3
Assets and liabilities – continued
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financial statements
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Section 3
Assets and liabilities – continued
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Section 3
Assets and liabilities – continued
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Section 4
Cash, capital structure, and financing
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financial statements
85
4.1. Financial risks – continued
Section 4
Cash, capital structure, and financing – continued
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financial statements
86
Section 4
Cash, capital structure and financing – continued
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financial statements
87
Section 4
Cash, capital structure, and financing – continued
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financial statements
88
Section 5
Other notes
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financial statements
89
Section 5
Other notes – continued
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financial statements
90
Section 5
Other notes – continued
5.2 Shared-based payments – continued
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financial statements
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5.2 Shared-based payments – continued
Section 5
Other notes – continued
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Section 5
Other notes – continued
5.2 Shared-based payments – continued
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financial statements
93
Section 5
Other notes – continued
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94
Section 5
Other notes – continued
Income statement
DKK 1,000 Note 2022 2021
Net revenue 28,709 9,090
Cost of goods sold (23,435) (5,549)
Gross profit 5,274 3,541
Distribution costs 2.1 (16,366) (6,394)
Sales and marketing costs 2.1 (27,093) (26,600)
Research and development costs 2.1 (52,211) (52,430)
Administrative costs 2.1 (21,462) (15,222)
Costs related to IPO, administrative costs 2.2 - (37,319)
Other operating income 2.3 1,969 1,975
Other operating expenses 2.3 (5,007) -
Operating Profit (EBIT) (114,896) (132,449)
Share of net profit of associates (23) (1,602)
Share of net profit of subsidaries (24) -
Finance income 2.4 2,047 2,252
Finance costs 2.4 (2,690) (4,756)
Earnings before income tax (115,586) (136,555)
Income tax expenses 5,391 5,430
Earnings for the period (110,195) (131,125)
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96
Balance sheet December 31, 2022
DKK 1,000 Note 2022 2021
Finished development projects 3.1 34,614 39,979
Development projects in progress 3.1 55,232 46,276
Other intangibles 3.1 452 313
Total intangible assets 90,298 86,568
Plant and machinery 3.2 35,872 39,942
Right-of-use assets 3.2 49,105 48,802
Other equipment 3.2 2,027 2,773
Leasehold improvements 3.2 16,766 18,291
Total tangible assets 103,770 109,808
Investments in subsidiaries 3.3 3,012 3,147
Investments in associates 3.4 24 47
Deposits 2,230 2,005
Financial assets 5,266 5,199
Total non-current assets 199,334 201,575
Inventories 10,738 17,593
Trade receivables 12,430 5,152
Receivables from group enterprises 13,358 15,684
Other receivables 2,209 2,166
Income tax receivable 5,500 5,500
Prepayments 3.6 5,066 2,155
Cash and cash equivalents 28,491 142,470
Total current assets 77,792 190,720
Total assets 277,126 392,295
DKK 1,000 Note 2022 2021
Share capital 10,131 10,131
Retained earnings 109,553 230,251
Reserve for exchange rate translation (2,089) (2,089)
Reserve for development projects 53,488 43,727
Total equity 171,083 282,020
Lease liability 52,541 51,735
Other payables 3,596 5,284
Total non-current liabilities 56,137 57,019
Provisions 3,735 111
Lease liability 3,110 2,659
Prepayments 469 -
Trade payables 2,870 7,1 0 7
Other payables 9,798 11,128
Deferred government grants 3.7 29,924 32,251
Total current liabilities 49,906 53,256
Total liabilities 106,043 110,275
Total equity and liabilities 277,126 392,295
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97
Statement of changes in equity
DKK 1,000 Share capital Retained earnings
Reserve for
exchange rate
Reserve for
development
projects Total equity
Balance at December 31, 2020 8,174 73,390 (2,089) 39,109 118,584
Profit for the period - (131,125) - - (131,125)
Capitalized development costs - (4,618) - 4,618 -
Increase in share capital 1,957 293,368 - - 295,325
IPO expenses - (4,038) - - (4,038)
Share-based payment - 3,274 - - 3,274
Balance at December 31, 2021 10,131 230,251 (2,089) 43,727 282,020
Profit for the period - (110,195) - - (110,195)
Capitalized development costs - (9,761) - 9,761 -
Share-based payment - (742) - - (742)
Balance at December 31, 2022 10,131 109,553 (2,089) 53,488 171,083
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Section 1
Basis of preparation of financial
statements of parent company
1.1 Accounting policies
Section 3
Assets and liabilities
3.1 Intangible assets
3.2 Property, plant, and equipment
3.3 Investments in subsidiaries
3.4 Investments in associates
3.5 Deferred tax
3.6 Prepayments
3.7 Deferred government grants
Section 2
Operating activities
2.1 Staff costs
2.2 Costs related to IPO, administrative costs
2.3 Other operating income and expenses
2.4 Financial income and expenses
Section 4
Other notes
4.1 Fees to auditors
4.2 Commitments and contingent liabilities
at December 31
4.3 Related parties
4.4 Events after the balance sheet date
4.5 List of Group companies at December 31
Notes to the parent company
financial statements
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financial statements
99
1.1 Accounting policies
The Financial Statements of Aquaporin A/S as
parent company have been prepared in
accordance with the provisions of the Danish
Financial Statements Act (accounting class D).
The Financial Statements are presented in DKK.
Adjustments to comparative figures
Distribution cost has become a significant
amount in 2022 and therefore presented
separately in the income statement. In 2021 the
costs were included as part of Research and
development costs, but have for 2022 been
corrected and included in the comparative
figures for 2021. The adjustment does not have
any net impact on the income statement, balance
sheet, cash flow or equity.
In the equity statement for the parent company
for 2021, a correction has been made between
retained earnings and development projects. The
adjustment does not have any net impact on the
income statement, balance sheet, cash flow or
total equity, but only on presentation in the
equity.
Description of accounting policies
In relation to the accounting policies described
for the financial statements of the Aquaporin
Group (see Note 1.1 in the consolidated financial
statement), the accounting policies of the
parent company differ in the following:
Basis of preparation of financial statements
of parent company
Section 1
Dividends
Dividends from the Group companies are
recognized as income in the income statement
of the Parent Company in the financial year in
which the dividend is declared. If the carrying
amount of an investment in a subsidiary
exceeds the carrying amount of the net assets
in the subsidiary’s financial statements or the
dividend exceeds the total comprehensive
income of the subsidiary in the period the
dividend is declared, the carrying amount of the
subsidiary is tested for impairment.
Tax
Aquaporin A/S and its Danish subsidiary are
subject to mandatory joint taxation. As the
ultimate parent company in the Aquaporin
Group, Aquaporin A/S acts as the
administration company of the joint taxation
scheme and consequently settles all payments
of tax with the tax authorities. Joint taxation
contributions to/from subsidiary are recognized
under income tax related to net profit. Tax
payable and tax receivable are stated under
current assets/ liabilities. Companies that use
tax losses in other companies pay joint taxation
contributions to the parent company equivalent
to the tax base of the tax losses utilized.
Companies whose tax losses are used by other
companies receive joint taxation contributions
from the parent company equivalent to the tax
base of the tax losses utilized (full absorption).
Management review
With reference to Danish Financial Statements
Act § 78 (6) Management review of the Parent
company is not prepared.
Cash Flow Statement
With reference to Danish Financial Statements
Act § 86 (4) cash flow statement is not
prepared.
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06 Parent company
financial statements
100
2.1 Staff costs 2.3 Other operating income and expenses
2.2 Costs related to IPO, administrative costs
DKK 1,000 2022 2021
Salaries 56,483 58,000
Pension costs, defined contribution plans 1,475 988
Other expenses to social security 654 589
Share-based payments (742) 3,274
Total 57,870 62,851
Staff costs capitalized as part of development projects 4,224 4,480
Average number of full-time employees 69 65
Operating activities
Section 2
2.4 Financial income and expenses
DKK 1,000 2022 2021
Financial income
Interest income, banks 109 -
Interest income, intercompanies 999 637
Exchange rate adjustments, net 939 1,166
Total 2,047 1,803
Financial expenses
Interest expenses, banks 213 1,507
Interest expenses, lease liabilities 1,712 1,773
Interest expenses, group entities - 3
Other financial expenses, including bank fees 765 1,024
Total 2,690 4,307
Please refer to Note 5.1 in the consolidated
financial statements for information related to
remuneration of Board of Directors and
Executive Management.
§ Accounting policy
Other operating income and expenses include
items of a secondary nature in relation to the
companies’ main activity.
Other operating income consist of deferred
governments grants recognized in the income
statement with DKK 2.0 million in 2022 (2021:
DKK 2.0 million). It is recognized in the income
In 2021, IPO costs comprised various
consultancy fees as part of the IPO preparation,
insurances, bank engagement, and bonuses for
a number of employees for a successful
transaction.
statement as the related development projects
are recognized in the income statement
(depreciation/written down).
Other operating expenses consist of write-down
on inventory of products that were intended for
the Russion market. It has been decided to
cease the activities in the region due to the
current conflict in Ukraine.
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101
3.1 Intangible assets
§ Accounting policy
Acquired goodwill is measured at cost less
accumulated depreciation. Goodwill is
amortized linearly over the estimated useful life
estimated at 5 years.
DKK 1,000 Goodwill
Finished
development
projects
Development
projects in
progress Other intangibles Total
Cost price at January 1, 2022 2,899 57,279 46,276 406 106,860
Additions during the year - - 9,439 289 9,728
Transfer - 483 (483) - -
Purchase price at December 31, 2022 2,899 57,762 55,232 695 116,588
Amortizations at January 1, 2022 2,899 17,300 - 93 20,292
Amortizations - 5,848 - 150 5,998
Amortizations at December 31, 2022 2,899 23,148 - 243 26,290
Carrying amount December 31, 2022 - 34,614 55,232 452 90,298
Cost price at January 1, 2021 2,899 57,090 37,722 - 97,711
Additions during the year - - 8,743 406 9,149
Transfer - 189 (189) - -
Purchase price at December 31, 2021 2,899 57,279 46,276 406 106,860
Amortizations at January 1, 2021 2,319 11,475 - - 13,794
Amortizations 580 5,825 - 93 6,498
Amortizations at December 31, 2021 2,899 17,300 - 93 20,292
Carrying amount December 31, 2021
- 39,979 46,276 313 86,568
Assets and liabilities
Section 3
Material intangible assets:
See Note 3.1 in the consolidated financial statement.
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102
3.2 Property, plant, and equipment
DKK 1,000
Plant and
machinery
Right-of-use
assets
Other
equipment
Leasehold
improvements Total
Purchase price at January 1, 2022 61,411 64,461 11,830 27,268 164,970
Remeasurement - 4,456 - - 4,456
Additions during the year 221 419 246 - 886
Disposal during the year - (3,052) - - (3,052)
Purchase price at December 31, 2022 61,632 66,284 12,076 27,268 167,260
Depreciations at January 1, 2022 21,469 15,659 9,058 8,977 55,163
Depreciations 4,291 3,767 991 1,525 10,574
Depreciations disposal - (2,247) - - (2,247)
Depreciations at December 31, 2022 25,760 17,179 10,049 10,502 63,490
Carrying amount December 31, 2022 35,872 49,105 2,027 16,766 103,770
Purchase price at January 1, 2021 61,284 63,426 11,759 27,268 163,737
Additions during the year 127 1,035 71 - 1,233
Purchase price at December 31, 2021 61,411 64,461 11,830 27,268 164,970
Depreciations at January 1, 2021 16,331 11,962 7,982 7,452 43,727
Depreciations 5,138 3,697 1,075 1,525 11,436
Depreciations at December 31, 2021 21,469 15,659 9,058 8,977 55,163
Carrying amount December 31, 2021
39,942 48,802 2,772 18,291 109,807
Assets and liabilities – continued
Section 3
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103
3.3 Investments in subsidiaries
§ Accounting policy
Investments in subsidiaries are measured at
cost. Where cost exceeds the recoverable
amount, a write-down is made to this lower
value.
DKK 1,000 2022 2021
Purchase price at January 1 3,148 3,148
Disposals during the year (136) -
Purchase price at December 31 3,012 3,148
Investments in subsidaries are specified as followed:
Aquaporin’s holding
Aquaporin Asia Pte. Ltd. 100%
Aquaporin Membrane Protein ApS* 100%
Aquaporin US Inc. 100%
* Liquidated on October 26, 2022
3.4 Investments in associatesIn connection with acquisition of further equity
investments in a subsidiary, Management
assesses the equity method as a method of
consolidation, where recognition in the Parent
company reflects the accounting treatment in
the consolidated financial statements.
DKK 1,000 2022 2021
Purchase price at January 1 26,679 26,679
Purchase price at December 31 26,679 26,679
Accumulated write-ups and write-downs at January 1 (26,632) (25,030)
Unrealized gain on sale of assets from Aquaporin - 407
Share of result after tax (23) (211)
Write-down - (1,798)
Accumulated write-ups and write-downs at December 31 (26,655) (26,632)
Carrying amount December 31 24 47
Investments in associates are specified as followed:
Aquaporin’s holding
Aquapoten Company Limited 45%
Aquaporin Space Alliance ApS 50%
Assets and liabilities – continued
Section 3
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06 Parent company
financial statements
104
3.5 Deferred tax
DKK 1,000 2022 2021
Intangible assets (10,477) (3,698)
Property, plant, and equipment (743) (3,215)
Current assets 2,601 2,601
Lease liability 11,263 11,966
Current liabilities 1,162 310
Deferred government grants 6,259 -
Tax loss carryforwards 84,586 65,585
Total 94,651 73,549
Not recognized (94,651) (73,549)
Total - -
3.6 Prepayments
Consist mainly of prepaid expenses related to
production, service agreement, rental fee etc.
3.7 Deferred government grants
Government grants comprises of grants for
investments, research and development
projects, etc. Grants are recognized when there
is a reasonable certainty that they will be
received.
Grants are recognized as deferred government
grants under current liabilities and will be
recognized in the income statement as the
related development projects are recognized in
the income statement (depreciation/written
down).
Deferred tax assets arising from temporary
deductible differences and tax losses carried
forward are recognized to the extent they are
expected to be offset against taxable income in
a foreseeable future.
Due to the risk that the deferred tax assets are
not utilized within a foreseeable future no
deferred tax asset has been recognized.
As per December 31, 2022, the unrecognized
deferred tax assets in Denmark amounted to
DKK 94.7 million (2021: DKK 73.5 million). The
tax losses can be carried forward infinitely
subject to the general rules on limited
deductibility due to ownership changes.
Assets and liabilities – continued
Section 3
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06 Parent company
financial statements
105
4.3 Related parties
The following shareholders are recorded in the
Company’s register of shareholders as holding
at least 5% of the votes or at least 5% of the
share capital:
M. Goldschmidt Capital A/S, Grønningen 25,
DK-1270 København K
Danica Pension, Livsforsikringsaktieselskab,
Parallelvej 17, DK-2800 Kongens Lyngby
4.5 List of Group companies at December 31
VP Capital N.V., Parklaan 46 / 201, 2300
Turnhout, Belgium
InterChina Water Treatment Hong Kong
Company Ltd, 15/F, CBB Tower, 3 Connaught
Road, Central Hong Kong
Other matters of interest in relation to related
parties are disclosed in the notes to the
consolidated financial statements.
Company Type Country Currency
Nominal
capital
Aquaporin’s
holding
Aquaporin Asia Pte. Ltd. Subsidiary Singapore SGD 103 100%
Aquaporin US Inc. Subsidiary USA USD 1 100%
Aquapoten Company Limited Associate China CNY 49,349 45%
Aquaporin Space Alliance ApS Associate Denmark DKK 80,000 50%
Aquaporin A/S
Türkiye (İstanbul) İrtinat Bürosu*
Branch of
Aquaporin
A/S Turkey DKK
*Aquaporin A/S Türkiye (Istanbul) Irtinat Bürosu ia a branch of Aquaporin A/S and registered in Türkey in June 2022.
The fully owned Danish subsidiary Aquaporin Membrane Protein ApS was liquidated on October 26, 2022.
Other notes
Section 4
There are no pending court and arbitration
cases or other contingent liabilities.
DKK 1,000 2022 2021
The total future minimum lease payments:
Within one year from the balance sheet date - 9
Total - 9
4.4 Events after the balance sheet date
Please see subsequent events after the balance
sheet date in Note 5.6 in the consolidated
financial statement.
4.2 Commitments and contingent liabilities at December 31
4.1 Fees to auditors
DKK 1,000 2022 2021
Statutory audit 400 356
Other assurance services 179 150
Tax advisory services 25 87
Other services* 104 2,405
Total 708 2,998
In 2022, EY Godkendt Revisionspartnerselskab
was chosen at the general meeting as new
group auditor. In 2022 PricewaterhouseCoopers
Statsautoriseret Revisionspartnerselskab
provided services that amounted to DKK 122
thousand in Other assurance services and Other
services.
* In 2021, PricewaterhouseCoopers Statsautoriseret Revision-
spartnerselskab provided other services in the amount of DKK
2.6 million of which DKK 2.3 million relates to the IPO. The
remaining fee relate to tax compliance, transfer pricing and
other assurance assessments and opinions.
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06 Parent company
financial statements
106
Executive Management
Board of Directors
Niels Heering
Chair
Søren Bjørn Hansen
Deputy Chair
Anne Broeng
Board member
Lars Hansen
Board member
Weiming Jiang
Board member
Anupam Bhargava
Board member
Jianlong Zhuang
Board member
Aquaporin
Annual Report 2022
Management’s
statement
107
Independent auditor’s report
Report on the audit of the Financial Statements
Aquaporin
Annual Report 2022
Independent
Auditor’s Report
108
Aquaporin
Annual Report 2022
Independent
Auditor’s Report
109
CVR No 30 7 0 0228
Aquaporin
Annual Report 2022
Independent
Auditor’s Report
110
aquaporin.com
Aquaporin A/S
Nymøllevej 78
Aquaporin Asia Pte. Ltd.
1 Cleantech One, #02-14
Cleantech One
Singapore 637141
Aquaporin A/S Turkiye (Istanbul) Irtibat Burosu
Seba Office Boulevard, D Blok. No. 21D/45
Sariyer, Istanbul
Turkey
Aquaporin China Co., Ltd.
Room 901-2961, Building No. 4, Shenkun Road
Minhang District, Shanghai, China
Aquapoten Co Ltd.
12A/F, Shougang Intl. Trade Tower No.60
Xizhimen North Street, Beijing, China
Phone: +45 82 30 30 82
CVR No 28 31 56 94
Municipality of reg. office
Auditors
EY Godkendt Revisionspartnerselskab
CVR No 73 31 74 28
Forward looking statements
Matters discussed in this report may constitute for-
ward-looking statements. Forward-looking statements are
statements that are not historical facts and that can be
identified by words such as “believe”, “expect”, “anticipate”,
“intends”, “estimate”, “will”, “may”, “continue”, “should”, and
similar expressions, as well as other statements regarding
future events or prospects. Specifically, this report includes
information with respect to projections, estimates, and
targets that also constitute forward-looking statements.
The forward-looking statements in this report are based
upon various assumptions, many of which are based, in
turn, upon further assumptions. Although Aquaporin A/S
(the “Company”) believes that these assumptions were
reasonable when made, these assumptions are inherently
subject to significant known and unknown risks, uncertain-
ties, contingencies, and other important factors which are
difficult or impossible to predict and are beyond its control.
Such risks, uncertainties and other important factors
include, among others: limited experience in commerciali-
zation of the Company’s products, failure to successfully
implement strategies, dependence on third parties for
manufacturing certain product components and the supply
of certain raw materials, the COVID-19 pandemic, effect of
economic sanctions and trade controls restrictions on
supply and customer demand, manufacturing disruptions,
strategic collaboration, protection of the Company’s
intellectual property rights and other risks disclosed in
Aquaporin’s annual reports and company announcements.
Such risks, uncertainties, contingencies, and other
important factors could cause actual events to differ
materially from the expectations, projections, estimates,
and targets expressed or implied in this report by such
forward-looking statements. The information, opinions and
forward-looking statements contained in this report speak
only as at its date, and are subject to change without
notice. Aquaporin expressly disclaims any obligation to
update or revise any forward-looking statements, except as
required by law.