hereby present the Annual Report - Scandi...

AR & CA Jan. 2013 - June 2013

The Board of Directors and Managing Director of

Kronfågel Holding AB

Corporate Identity Number 556529-6372

hereby present the

Annual Report and Consolidated Accounts

for the financial year 1 January - 30 June 2013

Contents: Page

Administration Report 2-3

Consolidated income statement 4

Consolidated balance sheet 5-6

Pledged assets and contingent liabilities – Group 6

Statement of changes in equity - Group 7

Cash flow statement – Group 8

Income Statement - Parent Company 9

Balance Sheet - Parent Company 10-11

Pledged assets and contingent liabilities - Parent Company 11

Statement of changes in equity - Parent Company 12

Accounting Principles and Notes to the financial statements 13-28

Signatures 29-32

3 (33) Kronfågel Holding AB Corporate Identity Number 556529-6372 AR & CA

Jan 2013 - June 2013

Administration Report Ownership structure Kronfågel Holding AB (the Company), Corporate Identity Number 556529-6372, is the Parent

Company of Kronfågel Holding Group, the wholly owned subsidiaries Kronfågel AB and the

Danish company, Danpo A/S, are included.

The Company is based in Stockholm and the address of its registered office is Box 30174,

104 25 Stockholm. During the fiscal year the Company's name was changed from

Lantmännen Kronfågel Holding AB to Kronfågel Holding AB during the fiscal year.

The Parent Company of the Company is Scandi Standard AB, Corporate Identity Number

556921-0619, with its registered office in Stockholm. Scandi Standard is part of the

Scandinavian Standard Group, which was established on 3 June 2013. This took place since the

former owner of the Company, Lantmännen ek för, sold their shares, and together with the

English company, CapVest Associates LLP, created the new group, which in turn acquired the

majority shareholding in Kronfågel Holding AB. The new Scandinavian Standard Group is owned

by CapVest Associates LLP (52%) and Lantmännen ek för (48%).

In conjunction with the aforementioned process, the Company also changed its financial year from the calendar year to a split financial year 1 July – 30 June with the first bookclosing on 30 June, 2013.

General information about the operations

The Company's main mission is to sell intra-Group services and manage various

comprehensive issues.

The Company is one of Scandinavia's leading chicken product groups with operations

consisting of the slaughtering, cutting, processing, packing and selling chicken products. The

products are sold under the well-recognized brands, Kronfågel, Danpo, Stina and Ivars.

Kronfågel AB’s operations are subject to licensing and reporting requirements under the

Environmental Code in Sweden. Similar provisions exist for Danpo A/S in Denmark. The

operations affect the external environment through the emission of grease through

wastewater and through odorous substances released into the air.

Development of the Company's operations, earnings and financial position

During the shortened financial year, the Group's earnings increased compared with the

same period in the previous year, primarily due to improvements in production as a result of

increased efficiency. An increase in slaughter volumes took place in Sweden during the

period in order to meet the increased demand for the Company’s products.

Customers include major food retail companies in Sweden and Denmark such as ICA,

COOP, Axfood, and Dansk Supermarket, but also customers in restaurant -and institutional

kitchens. The Group also executes the significant exports of products to parts of Europe and

Asia.

4 (33)


Corporate Identity Number 556529-6372 AR & CA

Jan 2013 -

June 2013

Financial overview 2013 (*) 2012 2011 2010

Net sales 1,761,559 3,405,198 3,230,626 3,172,720

Operating margin, % 5% 4% 4% 5%

Total assets 1,598,045 1,502,522 1,525,579 1,518,413

Equity/assets ratio, % 52% 51% 47% 42%

(*) Refers to the period January to June 2013, i.e. 6 months compared with 12 months for the

other periods

Significant events during the financial year and after the financial year Magnus Lagergren was appointed to serve as the new CEO of Kronfågel after the end of the financial year. He will assume his duties on 1 February 2014. A decision was made to return to having the calendar year as the Company’s financial year, beginning on 1 January 2014. Expected future development and significant/principal risks and uncertainties Competition from imported products and infectious diseases in birds involve risks to the Group's companies and can have effects on both sales and prices. Developments in global market prices may impact the Group's exports and through that its earning power. Significant future risks for the Company consist primarily of rising interest rates on the Company's short-term financing. Proposed appropriation of the Company's profit

The Board proposes that the following unappropriated funds be put at the disposal of the Annual

General Meeting:

Profit/loss brought forward 79,123,803

Net profit/loss for the year 2,962,042

Total 82,085,844

Profit to be carried forward 82,085,844 As regards the Group's and Parent Company's earnings and financial position, please refer to the following financial statements and accompanying Notes.

5 (33)



Jan 2013 -

June 2013

Consolidated income statement Note 1 Jan 2013 -- 1 Jan 2012 --

Amounts in TSEK 30 June 2013 31 Dec 2012

Net sales 2 1,761,559 3,405,198

Participations in associated companies' income 14 155 1,395

Other operating income 3 8,596 5,768

1,770,310 3,412,361

Operating expenses

Raw materials and consumables -1,042,674 -2,063,831

Other external expenses -261,772 -504,092

Personnel costs 4 -323,356 -611,868

Depreciation and write-down of tangible and

of intangible fixed assets -54,713 -100,689

Operating income 87,795 131,881

Result from financial items

Interest income and similar profit/loss items 5 2,927 -2,995

Interest expenses and similar profit/loss items 6 -9,929 -23,458

Profit/loss after financial items 80,793 105,428

Appropriations

Group contributions, paid – -20,055

Profit/loss before tax 80,793 85,373

Tax on profit for the year 8 -17,744 -19,980

Net profit/loss for the year 63,049 65,393

6 (33)



Jan 2013 -

June 2013

Balance sheet - Group Amounts in TSEK Note 30 June 2013 31 Dec 2012

ASSETS

Fixed assets

Tangible fixed assets Land and buildings 9 141,101 141,851

Plant and machinery 10 363,014 400,060

Equipment, tools, fixtures and fittings 11 40,480 43,760

Constructions in progress and advance payments

regarding tangible fixed assets 12 110,533 73,752

655,128 659,423

Financial assets Receivables from Group companies 83,527 –

Participations in associated companies 14 19,869 19,788

Receivables from associated companies 2,280 2,288

Deferred tax assets 94,933 103,303

200,609 125,379

Total fixed assets 855,737 784,802

Current assets

Inventories, etc. Raw materials and consumables 57,449 62,593

Products in progress 297 1,223

Finished products and goods for resale 314,139 305,607

Advance payments to suppliers 8,429 6,882

380,314 376,305

Current receivables Accounts receivable - trade 281,960 214,672

Receivables from Group companies – 68,516

Other receivables 22,772 50,349

Prepaid expenses and accrued income 16 55,803 6,523

360,535 340,060

Current investments 1,306 1,211

Cash and bank balances Cash and bank balances 1,459 144

Total current assets 743,614 717,720

TOTAL ASSETS 1,599,351 1,502,522

7 (33)



Jan 2013 - June 2013

Balance sheet - Group Amounts in TSEK Note 30 June 2013 31 Dec 2012 EQUITY AND LIABILITIES Equity

Share capital 150,000 150,000

Reserves -89,022 -87,494

Profit/loss brought forward incl. net profit/loss for the year 770,385 707,336

Equity attributable to: shareholders in the Parent Company 831,363 7

69,842

Total equity 831,363 769,842

Provisions Provisions for pensions and similar commitments 17 2,110 2,265

Deferred tax liabilities 8,873 1,232

Other provisions 19 654 1,945

11,637 5,442

Long-term liabilities 20 Other liabilities to credit institutions 16,836 19,820

Liabilities to Parent Company 268,268 –

285,104 19,820

Current liabilities Liabilities to credit institutions 31,075 –

Accounts payable - trade 262,734 157,935

Liabilities to Parent Company – 338,466

Liabilities to Group companies 168 18,084

Current tax liabilities 2,210 8

Other liabilities 89,591 114,861

Accrued expenses and deferred income 21 85,469 78,064

471,247 707,418

TOTAL EQUITY AND LIABILITIES 1,599,351 1,502,522

Pledged assets and contingent liabilities - Group Amounts in TSEK 30 June 2013 31 Dec 2012

Pledged assets

For own liabilities and allocations Property mortgages 20,849 21,383

Contingent liabilities

Guarantee commitments, FPG/PRI 2,572 2,580

Guarantees, breeders 6,885 5,956

Other contingent liabilities (Leasing) 34,361 –

43,818 8,536


Jan 2013 – June 2013

Statement of changes in equity - Group Share Share

equity equity Reserves

Group Opening balance 1 Jan 2012 150,000 – -69,571

Translation differences -17,923

Equity 31 Dec 2012 150,000 – -87,494

Opening balance 1 Jan 2013 150,000 – -87,494


Equity 30 June 2013 150,000 – -89,022

Profit/loss brought

forward Total

incl. net profit/loss for

the year Equity

Group Opening balance 1 Jan 2012 641,943 722,372


Changes in reported values also reported directly against equity


Equity 31 Dec 2012 707,336 769,842

Opening balance 1 Jan 2013 707,336 769,842


Changes in reported values also reported directly against equity


Equity 30 June 2013 770,385 831,363

9 (33)



1301 – 1306

Cash flow statement for the Group

Amounts in TSEK Note 1 Jan 2013 - 1 Jan 2012 -

30 June 2013 31 Dec 2012

Operating activities

Profit/loss after financial items 22 78,490 99,895

Adjustment for items not included in cash flow, etc. 24 55,625 100,681

134,115 200,576

Income tax paid -1 -12

Cash flow from operating activities before

changes in working capital 134,114 200,564

Cash flow from changes in working capital

Increase(-)/decrease in inventories -4,639 -5,397

Increase(-)/decrease in operating receivables -101,564 -40,411

Increase(+)/decrease in operating liabilities 92,469 -9,750

Cash flow from operating activities 120,380 145,006

Investing activities

Acquisition of tangible fixed assets -52,181 -104,768

Disposals of tangible fixed assets 78 565

Acquisition of subsidiaries/operating, net liquidity effects 24 – -2,226

Acquisition of financial assets -16,052 -16,938

Cash flow from investing activities -68,155 -123,367

Financing activities

Repayment of borrowings -43,287 -20,659

Group contributions received 12,434 32,050

Group contributions paid -20,057 -32,986

Cash flow from financing activities -50,910 -21,595

Cash flow for the year 1,315 44

Cash and cash equivalents at beginning of year 144 103

Effect of exchange rate differences in cash and cash equivalents 0 -3

Cash and cash equivalents at end of year 23 1,459 144

10 (33)



Jan 2013 – Dec 2013

Income Statement - Parent Company

Amounts in TSEK Note 1 Jan 2013 - 1 Jan 2012 -

30 June 2013 31 Dec 2012

Operating expenses

Other external expenses -146 -198

Operating profit/loss -146 -198

Result from financial items

Interest income and similar profit/loss items 5 7,306 6,403

Interest expenses and similar profit/loss items 6 -2,097 -6,165

Profit/loss after financial items 5,063 40

Appropriations

Group contributions, paid – -35

Appropriations, and 7 -1,266 –

Profit/loss before tax 3,797 5

Tax on profit for the year 8 -835 -1

Net profit/loss for the year 2,962 4

11 (33)



Jan 2013 - June 2013

Balance Sheet - Parent Company Amounts in TSEK Note 30 June 2013 31 Dec 2012

ASSETS

Fixed assets

Financial assets Participations in Group companies 13 121,352 121,352

Receivables from Group companies 453,004 236,621

Total fixed assets 574,356 357,973

Current assets

Current receivables Receivables from Parent Company – 8,577

Receivables from Group companies 912 342

Other receivables 15 4

927 8,923

Cash and bank balances Cash and bank balances 0 0

Total current assets 927 8,923

TOTAL ASSETS 575,283 366,896

12 (33)



Jan 2013 – June 2013

Balance Sheet - Parent Company Amounts in TSEK Note 30 June 2013 31 Dec 2012 EQUITY AND LIABILITIES Equity Restricted equity

Share capital (15,000,000 shares) 150,000 150,000

Non-restricted equity Profit/loss brought forward 79,123 79,119

Net profit/loss for the year 2,962 4

82,085 79,123

232,085 229,123

Untaxed reserves Other untaxed reserves 7 1,266 –

1,266 –

Long-term liabilities 20 Liabilities to Parent Company 268,268 –

Liabilities to Group companies 72,400 –

340,668 –

Current liabilities Liabilities to credit institutions 95 –

Liabilities to Parent Company – 137,427

Current tax liabilities 837 3

Other liabilities – 35

Accrued expenses and deferred income 21 332 308

1,264 137,773

TOTAL EQUITY AND LIABILITIES 575,283 366,896

Pledged assets and contingent liabilities - Parent Company Amounts in TSEK 30 June 2013 31 Dec 2012

Pledged assets None None

Contingent liabilities None None


Jan 2013 – June 2013

Statement of changes in equity - Parent Company

Share

New share issue Revaluation

Restricted equity equity during Registration of share reserve

Opening balance 1 Jan 2012 150,000 – –

Equity 31 Dec 2012 150,000 – –

Opening balance 1 Jan 2013 150,000 – –

Equity 30 June 2013 150,000 – –

Share premium

Retained Total Equity

Non-restricted equity

earnings incl.

reserve profit/loss for the year

Opening balance 1 Jan 2012 436,819 -357,700 229,119

Net profit/loss for the year 4 4

Equity 31 Dec 2012 436,819 -357,696 229,123

Opening balance 1 Jan 2013 436,819 -357,696 229,123


Equity 30 June 2013 436,819 -354,734 232,085


Jan 2013 – June 2013

Notes Amounts are in TSEK, unless otherwise stated

Note 1 Accounting principles The Annual Report has been prepared in accordance with the Swedish Annual Accounts Act and

the general advice and guidelines of the Swedish Accounting Standards Board, and regarding

reporting of inventories, the Swedish Financial Accounting Standards Council's recommendations

RR 2:02. Regarding revaluation of foreign currencies, the Swedish Financial Accounting Standards

Council’s recommendations RR 8 have been applied. Defined benefit plans are reported in

accordance with FAR RedR 4, Reporting of pension liabilities and pension costs.

The Parent Company applies the same accounting principles as the Group, unless otherwise stated below.

Tangible fixed assets Tangible fixed assets are reported at cost less accumulated amortisation/depreciation, and any accumulated write-downs. The acquisition cost includes, in addition to purchase price, expenditures directly attributable to the acquisition.

Additional expenses Additional expenses that meet the asset criteria are included in the asset's carrying value. Expenditures for maintenance and repairs are expensed as incurred.

Depreciation/amortization Depreciation/amortization takes place linearly over the asset's estimated useful life, as it reflects the expected pattern of consumption of the asset's future economic benefits. The depreciation/amortisation is reported as an expense in the income statement.

When applicable, estimated residual value, determined at the time of acquisition, is taken into account

Useful life

Plant and machinery 5-15 years

Equipment, tools, fixtures and fittings 3-10 years

Write-downs of fixed assets

At each balance sheet date it is determined whether there is any indication that an asset value is

less than its carrying value. If such indication exists, the asset's recoverable amount is determined.

The recoverable amount is the higher of fair value less costs to sell and value in use. In calculating

the fair value, the present value of the future cash flows that the asset is expected to generate in

the current business and when it is sold or scrapped. The discount rate used is before tax and

reflects market assessments of the time value of money and the risks relating to the asset. A

previous impairment loss is reversed only if the reasons underlying the calculation of the

recoverable amount at the previous impairment loss have changed.

Leasing There are operating lease agreements within the Group. The leasing fees including enhanced initial lease payments, are reported as expenses linearly over the lease term. The Group companies are only lessees.

Inventories Inventories are valued at the lower of acquisition cost and net realizable value. Additionally, risk of obsolescence has been taken into account. Acquisition cost is calculated using the first-in first-out principle. The cost includes, besides the cost of the purchase, expenses incurred in bringing the inventories to their present location and condition. For semi-finished and finished goods of own production, cost comprises direct production costs and an allocation of manufacturing overheads. The valuation takes into consideration normal capacity utilization.


Jan 2013 – June 2013

Financial assets and liabilities Financial assets and liabilities are reported in accordance with the Swedish Annual Accounts Act

5:2

Financial instruments reported in the balance sheet include securities, other financial assets, trade

receivables, trade payables and borrowings. Fair values of financial instruments are based on

current market rates as at the reporting date. Market rates and an estimate of the company's risk

premium is the basis for calculations of the fair values of long-term loans. For other financial

instruments, mainly short-term loans and investments where the market value is not listed, the

market value is equivalent to book value.

Accounts receivable - trade. Accounts receivable are reported as current assets to the amount

expected to be paid after deduction of individually estimated bad debts.

Borrowings. Borrowings are initially reported at the amount received net of transaction costs. If the

reported amount differs from the amount to be repaid on the due date, the difference, and the interest

expense or interest income, is allocated over the life of the loan. This will result in that, on maturity, the

carrying amount and the amount to be refunded will be equal. Reporting of the financial liabilities does

not end until the debts have been settled through repayment or the debt has been waived.

Transaction exposure. Accounts receivable and accounts payable in foreign currencies are valued at

the closing rate of exchange. Hedging transactions regarding future flows in foreign currencies affect

results in line with the reporting of the hedged receivables and liabilities in the balance sheet. Hedging

transactions are valued at the closing rate of exchange and revaluations are reported in Operating

profit/loss.

Hedging of financial assets and liabilities in foreign currencies. Currency forward contracts are entered with

the intention to protect the Group from movements in exchange rates by contract determining the rate at which an asset or liability in foreign currency will be realized. An increase or decrease of the amount required to settle the asset / liability is offset by a corresponding change in the value of the futures contract.

Hedging of the Group's interest rate. Agreement on a so-called interest rate swap protects parts of the Group from interest rate changes. Any interest that is received or paid due to interest rate swaps, are reported under interest expenses and similar items, and allocated over the contract period. Remuneration to employees Pensions Plans for post-employment benefits are classified as either defined contribution plans or defined benefit plans. For the defined contribution plans, fixed fees are paid to an insurance company and the Group has no further obligation to the employee once the fee has been paid. In defined benefit plans, the Company has an obligation to provide the agreed benefits to current and former employees. The Group thus bears the risks associated with the future payment.

Defined benefit plans are reported in accordance with FAR Red 4, Accounting for pension liabilities and pension. The company has defined benefit pensions for employees and the Company's obligations to future pay pensions thus has a current value determined for each employee with reference to pension level, age, and the extent to which full pension has been earned. This value is calculated on an actuarial basis, and based on the salary and pension levels prevailing at the balance sheet date. Pension obligations are reported as a provision in the balance sheet.

There are both defined contribution and defined benefit pension plans within the Group.

Plans for which pension premiums paid are reported as defined meaning that expenses are reported in the income statement. Most of the group's defined benefit pension obligations are funded through the transfer of funds to a pension fund and a provision is thus only applicable in the cases when the fund's assets, valued at market value, are less than the obligation. In cases where the fund's assets exceed its obligations no asset is reported. Pension liabilities in the Group's foreign subsidiaries are reported in the same way as in the foreign subsidiary. Tax

Income tax expense in the income statement comprises current tax and deferred tax. Current tax

includes income tax on the taxable income and possibly adjustment of tax relating to previous

years’ income. Deferred tax relates to income tax on taxable income in the future as a result of

transactions or events that are already included in the report.

Deferred tax liabilities are reported for all taxable temporary differences, except for temporary

differences arising from the initial recognition of goodwill. Deferred tax assets are reported for

deductible temporary differences and the possibility of future use of tax loss carry forwards. This

rating is based on how the carrying value of the corresponding asset or liability is expected to be

recovered or settled. Amounts are based on tax rates and laws that have been enacted before the

balance sheet date and are has not been discounted to present value.

Deferred tax assets have been valued at more than the amount likely to be recovered based on the current and future taxable income. Estimates are reviewed each reporting date. In the consolidated balance sheet, untaxed reserves are divided into deferred tax liabilities and equity. Provisions A provision is reported in the balance sheet when the Company has a legal or constructive obligation as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made. Provisions are measured at the best estimate of the amount that will be required to settle the obligation at the balance sheet date. Provisions are reviewed at each balance sheet date.

Revenues Revenues are reported excluding VAT and have, when applicable, been reduced by the value of discounts. Upon the sale of goods, revenue is reported upon delivery of the product to the customer and in accordance with the current conditions, i.e., when all significant risks and rewards of ownership have been transferred to the customer. Interest is reported as income using the effective interest method. Dividends are reported when the right to receive a dividend has been established.

Consolidated accounts Subsidiaries Subsidiaries are entities in which Kronfågel Holding directly or indirectly holds more than 50 % of the voting rights or otherwise has a controlling influence. Control is the power to govern the financial and operating policies to obtain economic benefits. The consolidated financial statements are prepared using the purchase method. Acquisition cost of the shares in the subsidiary represents the amount of cash and the fair value of other forms of consideration paid, payable on the shares, and includes any additional consideration. The purchase price allocation, the fair value at the acquisition date of the identifiable assets acquired and liabilities assumed.

As of the acquisition date, the acquirer’s income and expenses, identifiable assets and liabilities and any goodwill or negative goodwill arising on consolidation.

If ownership in a subsidiary is divested or control ceases otherwise, the decrease in ownership is

considered as divested in the consolidated accounts and the gain or loss on disposal is reported in

the consolidated income statement. If shares remain after control has ceased, these are reported

by the fair value at the acquisition date as cost.

Associated companies Shares in associated companies in which the Group has between 20% and 50% of the voting rights or otherwise has significant influence over operating and financial policies, are reported using the equity method. The equity method implies that the carrying value of shares in associated companies corresponds to the Group's share of associated companies' equity, adjusted by any consolidated surplus or deficit. The Group's share of the associated company’s profit after tax, adjusted for any earnings impact from consolidated surplus and deficits, is reported as "Share of results of associates" in the consolidated income statement. Dividends received from associates reduce the carrying amount. ÅRL. I undantagsfall får även anskaffningsvärdemetoden tillämpas.

Elimination of transactions between group companies and associates Intra-Group balances and transactions, income and expenses and unrealized gains or losses arising on transactions between Group companies are eliminated in full. Unrealized gains arising from transactions with associates are eliminated to the extent of the Group's holding in the company. Unrealized losses are eliminated in the same way as unrealized gains, but only to the extent that there is no indication of impairment.

19 (33)



Jan 2013 -

June 2013

Note 2 Net sales per business segment and geographic market

1 Jan 2013-- 1 Jan 2012-- 30 June 2013 31 Dec 2012

Group Net sales per geographic market

Sweden 821,353 1,487,539

Denmark 940,206 1,917,659

1,761,559 3,405,198

Note 3 Other operating income

1 Jan 2013-- 1 Jan 2012-- 30 June 2013 31 Dec 2012

Group Exchange rate gains on receivables 1,604 –

Claims incurred 3,858 –

Other 3,134 5,768

8,596 5,768

Note 4 Employees, personnel costs and fees to the Board of Directors and Auditors

Average number of employees of

whom of

whom

1 Jan 2013 - Women 1 Jan 2012 - Women

30 June 2013 31 Dec 2012

Parent Company

Parent Company has non employees.

Subsidiaries Sweden 530 42% 507 43%

Denmark 659 37% 731 40%

Total, subsidiaries 1,189 40% 1,238 41%

Group total 1,189 40% 1,238 41%

Report on gender distribution in Company management 30 June 2013 31 Dec 2012 Share of women Share of women

Parent Company

Board of Directors 33% 0%

Other senior executives 29% 25%

Group total Board of Directors 18% 8%

Other senior executives 23% 26%

20 (33)



Jan 2013 -

June 2013

Salaries, other remunerations and social security contributions, including pension costs

1 Jan 2013 - 30 June 2013 1 Jan 2012 – 31 Dec 2012

Salaries and Social

security Salaries and Social security

remuneration costs remuneration costs

Subsidiaries 262,025 52,821 493,993 100,516 (of which pension expenses) (17,321) (31,586)

Group total 262,025 52,821 493,993 100,516 (of which pension expenses) 2) (17,321) 2) (31,586)

2) Of the Group's pension costs 169 (previous year 247), refers to corporate management consisting of 33 (39) persons. Salaries and other remuneration distributed between Members of the Board etc. and other employees

1 Jan 2013 – 30 June 2013 1 Jan 2012 – 31 Dec 2012

Board Other Board Other

and Managing

Director employees

and Managing Director employees

Subsidiaries 2,823 252,845 5,480 487,906 (of which bonuses, etc.) (7) (14)

Group total 2,823 252,845 5,480 487,906 (of which bonuses, etc.) (7) (14)

Auditor's fees and remuneration

1 Jan 2013 - 1 Jan 2012 -

30 June 2013 31 Dec 2012

Group PWC

Audit assignment 500 –

Ernst & Young Audit assignment 356 1,228

Tax advisement – 23

Other assignments – 11

Parent Company PWC

Audit assignment 66 –

Ernst & Young Audit assignment – 133

Audit assignments involve examination of the annual report and accounts, review of the Board of

Directors’ and Managing Director’s management, as well as other tasks which the Company’s

auditor(s) perform. Additionally, it includes assistance and advisory services performed as a result

of observations arising in connecting with the execution of the abovementioned examinations and

other tasks.

21 (33)



Jan 2013 -

June 2013

Note 5 Interest income and similar profit/loss items

1 Jan 2013 - 1 Jan 2012 - 30 June 2013 31 Dec 2012

Group Interest income, Group companies – 1,847

Interest income, other 1,121 282

Exchange rate differences on financial items 1,806 -5,124

2,927 -2,995

Parent Company

Interest income, Group companies 5,466 11,205

Interest income, other 59 –

Exchange rate differences on financial items 1,781 -4,802

7,306 6,403

Note 6 Interest expenses and similar profit/loss items

1 Jan 2013 - 1 Jan 2012 - 30 June 2013 31 Dec 2012

Group Interest expenses, Group companies – -12,696

Interest expenses, other -9,929 -10,762

-9,929 -23,458

Parent Company

Interest expenses, Group companies – -6,165

Interest expenses, other -2,097 –

-2,097 -6,165

Note 7 Appropriations, other 1 Jan 2013 - 1 Jan 2012 - 30 June 2013 31 Dec 2012

Tax allocation reserve, provision for 2013 -1,266 –

Note 8 Tax on profit for the year 1 Jan 2013 - 1 Jan 2012 - 30 June 2013 31 Dec 2012

Group Current tax expense /tax revenue -2,191 12,707

Deferred tax -15,553 -32,687

-17,744 -19,980

1 Jan 2013 - 1 Jan 2012 - 30 June 2013 31 Dec 2012 Parent Company

Current tax expense -835 -1

-835 -1

22 (33)



Jan 2013 -

June 2013

Reconciliation of effective tax 1 Jan 2013 - 1 Jan 2012 - 30 June 2013 31 Dec 2012

Group Percent Amount Percent Amount

Profit/loss before tax 80,793 85,373

Tax according to current tax rate for the Parent Company 22.0% -17,774 26.3% -22,453 Effect of other tax rates for foreign subsidiaries -1.5% 1,201 -1.2% 1,042

Non-deductible expenses 0.3% -227 0.3% -243

Income not subject to tax 0.0% – -0.3% 236

Effect of changes in tax rates/and tax regulations/ 0.0% – -0.3% 241

Reversal of earnings in associated companies 0.0% 34 -0.4% 362

Other 1.2% -977 -1.0% 835

Reported effective tax 22.0% -17,744 23.4% -19,980

1 Jan 2013 - 1 Jan 2012 - 30 June 2013 31 Dec 2012

Parent Company Percent Amount Percent Amount

Profit/loss before tax 3,797 5

Tax according to current tax rates for Parent Company 22.0% -835 22.0% -1 Reported effective tax 22.0% -835 22.0% -1

Note 9 Land and buildings

30 June 2013 31 Dec 2012

Group Accumulated acquisition costs

Opening balance 340,187 359,655

Sales and disposals – -729

Reclassifications 4,836 -4,407

Net profit/loss exchange rate differences -1,261 -14,332

Closing balance 343,762 340,187

Accumulated depreciation Opening balance -139,076 -157,913

Reversed depreciation/amortisation of sales and disposals – 729

Reclassifications – 21,728 Depreciation for the year -5,041 -9,784

Net profit/loss exchange rate differences 489 6,164

Closing balance -143,628 -139,076

Accumulated write-downs Opening balance -59,260 -61,731


Closing balance -59,033 -59,260

Closing book value 141,101 141,851

of which land 30 June 2013 31 Dec 2012 Group

Accumulated acquisition costs 4,036 4,051

Accumulated write-downs -2,896 -2,908

23 (33)



Jan 2013 -

June 2013

Note 10 Plant and machinery

30 June 2013 31 Dec 2012 Group

Accumulated acquisition costs

Opening balance 1,101,702 1,056,495

Sales and disposals -103 -16,095

Reclassifications 7,327 84,036

Net profit/loss exchange rate differences -2,103 -22,734

1,106,823 1,101,702


Reversed depreciation/amortisation on sales and disposals 25 15,652

Reclassifications – 60,983 Depreciation for the year -43,352 -81,854


-616,181 -573,794

Accumulated write-downs At beginning of year -127,848 -130,253


-127,628 -127,848


Note 11 Equipment, tools, fixtures and fittings

30 June 2013 31 Dec 2012



New acquisitions – 696

Sales and disposals – -13,735

Reclassifications 3,128 23,399

Net profit/loss exchange rate differences -151 -1,660

88,438 85,461


Reversed depreciation/amortisation on sales and disposals – 13,613

Reclassifications – 774 Depreciation for the year -6,320 -9,051

Net profit/loss on exchange rate differences 60 1,263

-47,072 -40,812

Accumulated write-downs At the beginning of the year -889 -927

Net profit/loss on exchange rate differences 3 38

-886 -889


24 (33)



Jan 2013 - June 2013

Note 12 Constructions in progress and advance payments

regarding tangible fixed assets

30 June 2013 31 Dec 2012

Group Opening balance 73,752 159,475

Reclassifications -15,291 -186,512

Investments 52,118 104,072

Net profit/loss exchange rate differences -46 -3,283


Note 13 Participations in Group companies

30 June 2013 31 Dec 2012

Accumulated acquisition costs Opening balance 121,352 121,352


Specification of the Parent Company’s and Group's holdings of participations in Group companies

30 June 2013 31 Dec 2012

Particip

ation Carrying Carrying

Subsidiaries / Corporate Identity Number / Registered offices % (i) amount amount

Kronfågel AB, 556145-4223, Stockholm 100.0 121,352 121,352

Danpo A/S, 31,241,316, Farre Denmark 100.0 0 0

Creo Dofmas HB, 916625-2875, Stockholm – 0

(i) Percentage of equity ownership, which also corresponds to the percentage of votes of the total number of shares. Note 14 Participations in associated companies

30 June 2013 31 Dec 2012



Share of profits in associated companies for the year 155 1,395

Net profit/loss exchange rate differences -74 -94

19,869 19,788



Jan 2013 – June 2013

(i) Percentage of equity ownership, which also corresponds to the percentage of votes of the total number of shares.

Specification of Parent Company and the Group's participations in associates

30 June 2013

Participations Share of equity,

Associated companies Adjusted Equity / number

of in

/ Corporate Identity Number, registered offices / Net profit/loss for the year % (i) the Group

Indirectly owned Farmfood AS, Denmark – 33 19,869

Specification of the Parent Company’s and the Group's holdings of participations in associate companies

31 Dec 2012

Participations Share of equity

Associated companies Adjusted Equity

/ numbers

in in

/ Corporate Identity Number, registered offices / Net profit/loss for the year % (i) the Group

Indirectly owned Farmfood AS, Denmark – 33 19,788

(i) Percentage of equity ownership, which also corresponds to the percentage of votes

of the total number of shares.

26 (33)



Jan 2013 - June 2013

Note 15 Financial instruments and risk management

Derivatives and financial risk management

Group 30 June 2013 31 Dec 2012

Carrying Fair Carrying Fair

Assets amount value amount value

Derivatives for which hedge accounting is not applied Forward exchange agreements – 644 – 75

Interest rate swaps – 3,349 – 3,675

– 3,993 – 3,750

30 June 2013 31 Dec 2012

Carrying Fair Carrying Fair

Liabilities amount value amount value

Derivatives for which hedge accounting is not applied Forward exchange agreements – – – 281

– – – 281

Foreign exchange contracts are valued at fair value based on quoted prices in active markets for identical assets or liabilities, or if quoted prices does not exist other observables date, i.e. price quotations or data derived from prices quotations. The fair value of interest rate swaps is based on intermediary credit institutes’ valuations. Kronfågel AB buys chicken from Danpo A/S, for which payments are made in Danish kroner. To hedge the risk in this payment flow Kronfågel AB has purchased currency futures. These expired in December 2013 without being replaced by new contracts. Danpo A/S has a loan with Nykredit amounting to TEUR 2,350 (TEUR 2,540) with maturity in 2022. This loan carries variable interest. In order to hedge the interest rate risk, interest rate swaps has been purchased from Nordea, resulting in a fixed interest rate. The difference between the variable and fixed rate, is reported in the item "Interest and similar income". The effects of this swap are recognized as the interest payments are paid to Nykredit and are allocated over the contract period.

27 (33)



Jan 2013 - June 2013

Note 16 Prepaid expenses and accrued income

30 June 2013 31 Dec 2012

Group Advance payments breeders 10,862 –

Insurance compensation 6,749 2,665

Other items 38,192 3,858

55,803 6,523

Note 17 Provisions for pensions and similar commitments Within Kronfågel's Swedish operations there are defined benefit pension obligations linked to a pension fund, Lantmännen's joint pension fund Grodden, and insured via PRI Pensionsgaranti. Obligations amounted to TSEK 128,604 as of 30 June (TSEK 128,366 as of 31 December). Kronfågel’s share of the fund's assets exceeds the obligation of about 15 million, which is the reason why no liability exists in respect to these pensions. From 1 June, employees who are still employees will have been transferred to the contributory pension plan with respect to vesting of pensions from that date.

1 Jan 2013 - 1 Jan 2012 -

Pension costs 30 June 2013 31 Dec 2012

The cost is reported in the following items in the income statement: Personnel costs 17,321 31,586

Interest expenses and similar profit/loss items 2,287 6,052

Total cost of post-employment benefits 19,608 37,638 Actuarial assumptions The defined benefit obligation is calculated by PRI Pensionsgaranti in accordance with the actuarial assumptions determined by them. The expected return on the pension fund's assets under management amounted to 3.5% by the end of 2012 and 3.75% by the end of June 2013. Note 18 Bank overdraft facility Granted overdraft credit facilities amounts to TSEK 60,000 for the Group and to TSEK 2 000 for the Parent Company.

Note 19 Other provisions

30 June 2013 31 Dec 2012

Group Restructuring measures 654 1,945

654 1,945

28 (33)



Jan 2013 - June 2013

Note 20 Long-term liabilities

30 June 2013 31 Dec 2012

Group Liabilities due after more than one year from the balance sheet date:

Other liabilities to credit institutions 16,836 19,820

Liabilities to Parent Company 268,268 –

All long-term liabilities with maturity within five years.

Note 21 Accrued expenses and deferred income

30 June 2013 31 Dec 2012

Group Accrued payroll expenses 10,507 11,516

Accrued vacation costs 27,989 21,640

Accrued social security contributions 18,847 16,087

Accrued special employer’s contribution on pension costs 5,667 11,200

Other items 22,459 17,621

85,469 78,064

Parent Company

Audit fees 332 308

332 308

Note 22 Paid interest and dividends received 1 Jan 2013 - 1 Jan 2012 - 30 June 2013 31 Dec 2012

Group

Interest received 1,121 2,129

Interest paid -9,929 -23,458

Note 23 Cash and cash equivalents 30 June 2013 31 Dec 2012

Group

The following sub-components are included in cash and cash equivalents:

Bank balances 1,459 144

Note 24 Other notes to the cash flow statement

Adjustment for items not included in the cash flow, etc 1 Jan 2013 - 1 Jan 2012 - 30 June 2013 31 Dec 2012

Group

Depreciation/amortization 54,179 97,081

Other items not affecting cash flow 1,446 3,600

55,625 100,681


Jan 2013 - June 2013

Note 25 Information regarding the Group The Company is a wholly-owned subsidiary of Scandi Standard AB, Corporate Identity Number 556921-0619, with its registered office in Stockholm. Scandi Standard AB is part of the group in which Scandinavian Standard AB, Corporate Identity Number 556921-0627, with its registered office in Stockholm.

Purchases and sales within the Group Of the Group's total purchases and sales measured in SEK, a total of 6 % of all purchases and 0 % of all sales concerns other companies within the entire corporate group to which the Group belongs. There were no more purchases or sales within the Parent Company.

30 (33) Kronfågel Holding AB AB


Jan 2013 - June 2013

Stockholm - 2013 Kate Penelope Briant Board member



Jan 2013 - June 2013

Stockholm - 2013 Alexander Noel Walsh Board member



Jan 2013 - June 2013

Stockholm - 2013 Leif Stig Hansen Managing Director

33 (33) Kronfågel Holding AB AB Corporate Identity Number 556529-6372 AR & CA

Jan 2013 – June 2013

Our audit report was submitted DD/MM 2013. Öhrlings PricewaterhouseCoopers AB

Bo Lagerström Authorised Public Accountant

hereby present the Annual Report - Scandi...

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Transcript of hereby present the Annual Report - Scandi...