Kvadrat A/S

Ledelsesberetning

Financial highlights 2025 2024 2023 2022 2021 Key figures DKK'000 DKK'000 DKK'000 DKK'000 DKK'000 Revenue 1,783,168 1,644,726 1,757,765 1,868,163 1,596,057 Gross profit/loss 783,119 697,335 679,158 661,063 604,923 Operating profit/loss 112,796 72,648 (11,521) 35,417 44,415 Net financials (57,619) (58,707) (56,356) (11,464) (16,868) Profit/loss for the year 20,961 10,913 (74,801) 16,576 27,190 Profit for the year excl. minority interests 13,231 4,280 (74,173) 20,285 18,909 Balance sheet total 1,321,097 1,287,368 1,329,699 1,549,524 1,527,213 Investments in property, plant and equipment 18,232 6,977 39,246 43,494 152,026 Equity 335,935 333,942 327,076 411,644 433,386 Equity excl. minority interests 306,242 311,450 306,480 378,604 396,927 Average number of employees 927 967 1,022 1,057 986 Ratios Gross margin (%) 43,92 42.40 38.64 35.39 37.90 Return on equity (%) 4,28 1.39 (21.65) 5.23 4.97 Equity ratio (%) 23,18 24,19 23,05 24.43 25.99 Financial highlights are defined and calculated in accordance with the current version of "Recommendations & Ratios" issued by the CFA Society Denmark. ???????????????????? ????????????????????????(????????????????) ???? ????????????Gross margin (%): ????????????????????????????????????????????????????(????????????????)???????????? ???????????? ???????????????? ????????????????.???????????????????????????????? ???????????????????????????????????? ???? ????????????Return on equity (%): ???????????????????????????? ???????????????????????? ????????????????. ???????????????????????????????? ???????????????????????????????????????????????????????????? ????????????????.???????????????????????????????? ???????????????????????????????????? ???? ????????????Equity ratio (%): ???????????????????????????? ???????????????????? ????????????????????Development in activities and finances The revenue for the Group for 2025 amounted to DKK 1.783m compared to DKK 1.645m in 2024. Operating profit/loss amounted to DKK 113m compared to DKK 73m in 2024 and profit before tax amounted to DKK 32m compared to DKK 14m in 2024. The revenue for the Parent company for 2025 amounted to DKK 740m compared to DKK 721m in 2024. Operating profit/loss amounted to DKK 5m compared to DKK -1m in 2024 and profit before tax amounted to DKK -11m compared to DKK -9m in 2024. The result for both the Group and the Parent company has in FY 2025 been significantly affected primarily by the following circumstances: Market Places The marketplaces in which we operate continue to be challenged in both activity levels and short-term outlooks; however, we managed to adapt and keep a solid growth in a competitive market resulting in an increase in consolidated revenue of DKK 138m or 8% growth compared to 2024. Growth in North America The last years Kvadrat has been building, developing, and improving the direct sale of Kvadrat products to the North American markets. This has required a significant number of resources and investments to make profitable. However, end of 2025 this strategic project finally ended above our expectations, and we expect growth to continue and profitability to improve even more next year. Supporting the sustainability agenda A challenge in 2025 has been to make our upcycles end-of-life textile business more profitable. It is a high priority of Kvadrat Group to support the sustainable agenda. A restructuring and several different initiatives have therefore been taken to support and protect the future of our production setup, which required extraordinary costs of DKK 23m in 2025. Optimizing our organisation and internal processes In 2025 we continued to optimize and adjust our organization and processes towards increased competitiveness. Improving our competitiveness has resulted in an increase in operating profit margin with DKK 40m compared to 2024. Cost of capital The net financial costs in 2025 amounted to 58m DKK resulting in a small decrease from 2024 to 2025 of 1m DKK. The cost of capital to serve the net interest-bearing debts of the Group consisting primarily of short-term credit facilities, long-term credit facilities, liabilities as well as mortgage debts has decreased significantly. However, exchange rate costs have increased in 2025 caused of especially a dollar weakness. The total net financial costs therefore end stabile in 2025 compared to 2024. Profit/loss for the year in relation to expected developments The development in Group and Parent company revenue and profits must be compared to the primarily positive expectations for 2025 in the annual report for Kvadrat A/S for 2024. The Executive Board and Board of Directors consider the results for 2025 to be satisfactory with an 8% growth in revenue and DKK 40m increase in operating profit or 55% compared to 2024. The higher-than-expected operating profit is driven by better realized margins and cost savings. Risici Neither the Group nor the Parent Company are exposed to any major risks apart from those generally occurring in our line of business. Credit risks The Group is not exposed to major risk from a single customer or business partner. Credit risks are considered immaterial because in accordance with the Group’s credit process, all customers and other business partners are subject to our ongoing credit assessments, and the majority of the costumers is coved by credit insurance. Financial risks As a result of its operations, investments and financing activities, the Group is exposed to financial risks, including interest rate and foreign exchange risks. These risks are subject to ongoing monitoring. Currency risk The Group’s activities involve transactions in multiple currencies and are therefore exposed to fluctuations in exchange rates. The primary exposure relates to USD, which is subject to volatility. Currency exposure is monitored on an ongoing basis. Due to Denmark’s fixed exchange rate policy against the EUR, the foreign exchange risk related to EUR is considered limited. Interest rate risk The Group’s net interest-bearing debt is primarily denominated in DKK. A significant portion of mortgage and bank debt carries variable interest rates. The Group follows agreed repayment schedules with the Group's banks. Interest rate developments are monitored in ongoing dialogue with the Group’s banks. Outlook We continue expecting a general uncertainty in the markets, we operate. We will keep focus on our optimisation work and expect to see 5-8% revenue growth and 15% operating profit growth in 2026 compared to 2025. Knowledge resources We continue to work systematically in developing all employees in the organization to be able to best execute our Group strategy. Through our two annual Performance & Learning Conversations between all employees and their direct manager, we ensure that we are aligned on what learnings need to be applied on an individual-, team- and company-level. We have more than 150 managers across our production-, sales-, and development companies as well as our headquarters in Ebeltoft. We have continued our work with our senior management team as well as a larger group of managers with our people partner set up, where we internally support managers in people and performance-related topics. Instead of delegating leadership development to external consultants, we train and support our managers from our People Development team and utilize their knowledge of context and more direct availability. In 2025, we continue insourcing most training activities of our managers facilitated by our People Development department in collaboration with relevant external experts. This creates strong social and professional ties across the organization when leaders from different parts of the company are trained and educated together. We continue to work on the quality of our leadership and work more proactively and formalized with our people and organizational reviews. We have our own New Manager Academy and a High Potential Academy for our employees that we believe could assume more responsibility in a specialist or manager role going forward. 66 high potentials have participated, and this has generated 20 new managers, and 24 specialists taking on bigger roles. Finally, we are proceeding to build the necessary competencies through our Kvadrat Academy which serves as a training forum for all our employees. In our employee surveys, the employees are interviewed about their general satisfaction and specific matters related to their everyday working life. In 2025, we improved our overall employee satisfaction across key areas, including satisfaction and motivation, loyalty, learning and development, and perceptions of diversity and inclusion. Notably, the overall satisfaction went up to 74 in 2025 from 69 in 2024. Our strategic direction in Kvadrat The aspiration at Kvadrat is to “push the boundaries of high-quality textiles through design and innovation.” This is rooted in the identity of Kvadrat as a dynamic, forward-looking design company that continuously seeks to expand the boundaries of aesthetics and sustainable textile design globally. Kvadrat collaborates with architects to shape spaces, with designers and furniture manufacturers to craft furniture, and encourages consumers to bring personality and identity into their homes through tactility and colour. Success at Kvadrat is defined by four KPIs: employee temperature, customer pulse, brand reputation, and financial health. These KPIs represent the ultimate objectives for both short- and long-term success; therefore, all activities must strive to maximize value across these dimensions. The four KPIs are included in the global incentive program of Kvadrat. The Group strategy covers a two-year period (2025–2026), with the ambition of further strengthening our competitiveness and improving profitability. This will be delivered through three strategic priorities: Extreme focus We will drive growth within our core categories through a structured focus on segments. Transformation We will strengthen our organization and overall business performance through end-to-end collaboration, a global supply chain, further digitalization, and continued investment in learning and development. We are Kvadrat We will continue to strengthen our company culture and values. At Kvadrat, we remain committed to pushing the boundaries of high-quality textiles through design and innovation, reinforcing a shared identity across the organization. Environmental performance Kvadrat is a member of the Science Based Target initiative and aims to reach net zero greenhouse gas emissions by 2040. On this journey we build upon our long-term commitment to quality design, work with our production units and partners to reduce our impact on resources and the environment and continuously aim to innovate materials, our products and business models to rethink the way we operate in this world. Communicating our impact transparently to our clients through quality data is key. Therefore, we launched our first Environmental Product Declarations (EPD) in 2023 and in 2025 we offered our clients 11 Environmental Product Declarations (EPDs) for 128 of our textile products. More detailed information regarding our overall sustainability performance and targets can be found in our sustainability report (see link below). Research and development activities The development of our products happens in close collaboration between external affiliated designers and our internal product development teams. The costs related to research activities are expensed in the income statement. The costs related to development activities are either expensed in the income statement or capitalized in the balance sheet depending on the viability and economic return of the specific development project and whether the criteria for recognition in the balance sheet have been fulfilled. Events after the balance sheet date No events have occurred after the balance sheet date to this date, which would influence the evaluation of this annual report.

Beskrivelse af virksomhedens væsentligste aktiviteter

Primary activities Kvadrat is a global leader in textile innovation and design. We develop, produce and sell contemporary high-quality textiles and textile-related products for architects, designers and private consumers to specify in public spaces and domestic interiors.