Condensed Notes to the Consolidated Interim Financial Statements
1. Principles of Preparation
These condensed Consolidated Interim Financial Statements of NORMA Group as of June 30, 2022, have been prepared in accordance with IAS 34 “Interim Financial Reporting” as adopted by the European Union.
It is recommended that these financial Statements be read in connection with the Consolidated Interim Financial Statements in the 2021 Annual Report. These are available on the Internet at www.normagroup.com. All IFRS effective since January 1, 2022, as adopted by the EU, have been applied.
These Interim Financial Statements were approved for publication by resolution of the Management Board of NORMA Group on August 10, 2022.
2. Accounting Principles and Valuation Methods
The same accounting methods and consolidation principles have been applied in preparing these condensed Consolidated Interim Financial Statements as in the Consolidated Interim Financial Statements as of December 31, 2021. A detailed description of these methods is published in the Notes to the Consolidated Interim Financial Statements in the 2021 Annual Report. Note 3 “Summary of Significant Accounting PRINCIPLES”
No new or amended standards came into force in the current reporting period that had an impact on the Group’s accounting principles.
VALUATION METHODS |
|
|---|---|
Balance sheet item |
Valuation method |
Assets |
|
Goodwill |
Acquisition cost less potential impairment losses |
Other intangible assets (excluding goodwill) - finite useful lives |
Amortized acquisition or production cost |
Other intangible assets (excluding goodwill) - indefinite useful lives |
Acquisition cost less potential impairment losses |
Property, plant and equipment |
Amortized cost |
Derivative financial assets: |
|
Classification as a hedge of a forecast transaction (cash flow hedge) |
At fair value through other comprehensive income |
Classification as a hedge of a change in fair value (fair value hedge) |
At fair value through profit or loss |
Without hedge accounting |
At fair value through profit or loss |
Inventories |
Lower of acquisition or production cost and net realizable value |
Other non-financial assets |
Amortized cost |
Other financial assets |
Amortized cost |
Trade and other receivables |
Amortized cost |
Trade receivables, available for sale |
At fair value through profit or loss |
Contract assets |
Percentage-of-completion method less potential impairment |
Cash and cash equivalents |
Nominal value |
Non-current assets held for sale |
Lower of carrying amount and fair value less costs to sell |
Liabilities |
|
Pension obligations |
Projected unit credit method |
Other accrued liabilities |
Present value of future settlement amount |
Loans |
Amortized cost |
Other non-financial liabilities |
Amortized cost |
Lease liabilities |
Valuation based on IFRS 16.36 |
Other financial liabilities: |
|
Financial liabilities at cost (FLAC) |
Amortized cost |
Derivative financial liabilities: |
|
Classification as a hedge of a forecast transaction (cash flow hedge) |
At fair value through other comprehensive income |
Classification as a hedge of a change in fair value (fair value hedge) |
At fair value through profit or loss |
Without hedge accounting |
At fair value through profit or loss |
Contingent consideration (contingent purchase price liabilities) |
At fair value through profit or loss |
Trade and other payables |
Amortized cost |
The Consolidated Statement of Comprehensive Income is prepared using the nature of expense method.
The Consolidated Interim Financial Statements are presented in euros (EUR).
Income tax expense is recognized in each interim period based on the best estimate of the weighted average annual income tax rate expected for the full fiscal year.
3. Scope of Consolidation
As of June 30, 2022, the Consolidated Interim Financial Statements comprise six domestic and 44 foreign companies, unchanged from the end of 2021.
4. Adjustments
Management adjusts certain expenses for the operational management of NORMA Group. The adjusted results presented below therefore reflect the management perspective.
No net expenses were adjusted within EBITDA in the first six months of 2022. As in the previous year, depreciation of property, plant and equipment from purchase price allocations of EUR 603 thousand (H1 2021: EUR 714 thousand) was presented within EBITA (earnings before interest, taxes and amortization of intangible assets) in the first six months of the fiscal year and in addition amortization of intangible assets of EUR 10,440 thousand (H1 2021: EUR 9,990 thousand) within adjusted EBIT.
Notional income taxes resulting from the adjustments are calculated using the tax rates of the local companies concerned and included in adjusted earnings after taxes.
The following table shows earnings net of these effects:
PROFIT AND LOSS NET OF ADJUSTMENTS | |||||
|---|---|---|---|---|---|
in EUR thousand |
Note |
H1 2022unadjusted |
Step-up effects from purchase price allocations |
Total adjustments |
H1 2022 adjusted |
Revenue |
(5) |
622,289 |
0 |
622,289 | |
Changes in inventories of finished goods and work in progress |
|
2,843 |
0 |
2,843 | |
Other own work capitalized |
|
1,205 |
0 |
1,205 | |
Cost of materials |
|
–296,097 |
0 |
–296,097 | |
Gross profit |
|
330,240 |
0 |
0 |
330,240 |
Other operating income and expenses |
(6) |
–91,640 |
0 |
–91,640 | |
Employee benefits expenses |
(7) |
–157,531 |
0 |
–157,531 | |
EBITDA |
|
81,069 |
0 |
0 |
81,069 |
Depreciation of property, plant and equipment |
|
–25,004 |
603 |
603 |
–24,401 |
EBITA |
|
56,065 |
603 |
603 |
56,668 |
Amortization of intangible assets |
|
–14,450 |
10,440 |
10,440 |
–4,010 |
Operating profit (EBIT) |
|
41,615 |
11,043 |
11,043 |
52,658 |
Financial result |
(8) |
–4,532 |
0 |
–4,532 | |
Profit before income taxes |
|
37,083 |
11,043 |
11,043 |
48,126 |
Income taxes |
|
–10,384 |
–2,771 |
–2,771 |
–13,155 |
Result for the period |
|
26,699 |
8,272 |
8,272 |
34,971 |
Non-controlling interests |
|
54 |
0 |
54 | |
Profit for the period attributable to shareholders of the parent company |
|
26,645 |
8,272 |
8,272 |
34,917 |
Earnings per share (in EUR) |
|
0.84 |
1.10 | ||
PROFIT AND LOSS NET OF ADJUSTMENTS | |||||
|---|---|---|---|---|---|
in EUR thousand |
Note |
H1 2021unadjusted |
Step-up effects from purchase price allocations |
Total adjustments |
H1 2021 adjusted |
Revenue |
(5) |
568,067 |
|
0 |
568,067 |
Changes in inventories of finished goods and work in progress |
|
5,969 |
|
0 |
5,969 |
Other own work capitalized |
|
1,326 |
|
0 |
1,326 |
Cost of materials |
|
–249,477 |
|
0 |
–249,477 |
Gross profit |
|
325,885 |
0 |
0 |
325,885 |
Other operating income and expenses |
(6) |
-80,039 |
|
0 |
-80,039 |
Employee benefits expenses |
(7) |
–146,396 |
|
0 |
–146,396 |
EBITDA |
|
99,450 |
0 |
0 |
99,450 |
Depreciation of property, plant and equipment |
|
–22,460 |
714 |
714 |
–21,746 |
EBITA |
|
76,990 |
714 |
714 |
77,704 |
Amortization of intangible assets |
|
–14,699 |
9,990 |
9,990 |
–4,709 |
Operating profit (EBIT) |
|
62,291 |
10,704 |
10,704 |
72,995 |
Financial result |
(8) |
–6,159 |
|
0 |
–6,159 |
Earnings before income taxes |
|
56,132 |
10,704 |
10,704 |
66,836 |
Income taxes |
|
–15,036 |
–2,693 |
–2,693 |
–17,729 |
Result for the period |
|
41,096 |
8,011 |
8,011 |
49,107 |
Non-controlling interests |
|
70 |
|
0 |
70 |
Profit for the period attributable to shareholders of the parent company |
|
41,026 |
8,011 |
8,011 |
49,037 |
Earnings per share (in EUR) |
|
1.29 |
|
|
1.54 |
Legend
These contents are part of the Non-financial Group Report and were subject to a separate limited assurance examination.