Salfarm Danmark A/S

Ledelsesberetning

Management's reviewFinancial reviewThe income statement for 2025 shows net profit of DKK 37.1 million against DKK 31.2 million last year,and the balance sheetper 31 December 2025 shows equity of DKK 41.3 million.In 2024 financial statement management expected an EBITDA at or slightly above DKK 40m in 2025.In 2025, EBITDA has increased by 19,4% compared to 2024 to DKK 48.7 million, which is above the management expectations.The increase above expectations was driven by a higher increase on our turnover than expected mainly due to both newproducts arriving earlier than forecasted and existing products performing above forecast.Impact on the external environmentThe Company requires accountability from suppliers and wants to make sure that suppliers are working within the same ethicalguidelines and good business practices as the company. To ensure these terms are kept, the Company aims to integrate itscode of conduct in trade agreements with suppliers.Number of employeesAt year-end 2025, Salfarm Danmark A/S had 27 employees. We entered the year with 25 employees in Salfarm Danmark A/S.The 2025 average for Salfarm Danmark A/S ended at 25 employees.Unusual matters having affected the financial statementsThere have been no unusual circumstances which should be referred to in relation to the accounts.Foreign currency risksForeign activities mean that profit, cash flow and equity are affected by the exchange rate development between DKK, SEK,NOK and EUR. Management considers the company's risk of fluctuations in foreign currency to be moderate.Credit RisksSalfarm Danmark’s credit risks related to trade receivables are included in the balance sheet. Management has at year-endassessed the risks related to trade receivables and has made relevant provisions for losses. Historically the company has notexperienced any significant losses on trade receivables.Employee RisksHaving the right competencies with adequate experience is vital. Therefore, it is important that Salfarm Danmark A/S continuesto attract, retain and develop skilled employees. Failure to do so has the potential to negatively impact the expecteddevelopment of Salfarm Danmark A/S.Supplier RisksThe company has a large number of suppliers and keeps a focus on minimizing risks and dependency on single suppliers. Lossof key suppliers could have a negative effect on Salfarm Danmark A/S.IT RisksSalfarm Danmark A/S depends on Information Technology to manage critical business processes, ranging from sales,production, to administrative and financial functions. Salfarm Danmark A/S uses IT systems for internal purposes and externallyfor its customers. Extensive disruption of IT systems could have a negative effect on Salfarm Danmark A/S.Development activitiesDevelopment activities primarily include veterinary pharmaceutical development.In the financial year, product development corresponding to DKK 2.1 million is capitalized. Salfarm Danmark A/S continuouslyinvests in the development of veterinary pharmaceuticals, which is a key lever in the continued successful development ofSalfarm Danmark A/S.GovernanceThe Board of Directors and the Executive Board work constantly to ensure that appropriate and sufficient control systems are inplace, managed by a robust management team structure. The Board of Directors and the Executive Board have a number ofduties that are defined by the Companies Act, the Danish Financial Statements Act and the Articles of Association and Rules ofProcedure for the Board of Directors, among other regulations and policies. On this basis, the necessary internal procedures arecontinually being developed, refined, and maintained to ensure active, reliable and profitable management of Salfarm DanmarkA/S.The Board of Directors ensures that the Executive Board complies with the approved objectives, strategies, businessprocedures and rules of procedure for the Executive Board. The information presented to the Board of Directors is providedsystematically before and during meetings, as well as in written and verbal reports.The topics of these reports include market development and Salfarm Danmark A/S’s development and profitability. The Board ofDirectors and the Executive Management have overall responsibility for risk management and internal controls related tofinancial reporting.The Board of Directors of Salfarm Danmark A/S meet at least four times a year. Furthermore, information about SalfarmDanmark A/S, results and financial position is shared with the Board of Directors on a regular basis (monthly). If relevant,extraordinary meetings are held.Furthermore, the company’s main activities are regulated by EU legislation and requirements by the medicines agencies of eachcountry in which the company operates. To ensure compliance with rules and regulations, the company has a Regulatory andQuality Department with competent staff maintaining the company’s quality system and ensuring required training of thecompanies staff.Audit and risk committeeThe board and management have discussed the need for an audit and risk committee and have assessed that it is not relevantat this time given the size of the company.Events after the balance sheet dateNo events materially affecting the Company's financial position have occurred subsequent to the financial year-end.OutlookThe veterinary pharmaceutical market in the Nordic countries is expected to have a stable growth of approx. 4-5% over thecoming years. Salfarm is a well-established player and has developed a robust business model base, which forms a solidfoundation for further growth.Due to the growth in the market and the expectations of the coming activities, the company expects an EBITDA between DKK45m and 55m in 2026.

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Business reviewSalfarm Danmark A/S is an independent Nordic veterinary pharmaceutical company.