Rhenus Warehousing Solutions Denmark A/S

Ledelsesberetning

Key activities Rhenus Warehousing Solutions Denmark A/S (‘Rhenus WS Denmark’) is a warehousing and logistics company who aims to be leading within the industry, providing innovative automated and data-driven warehousing solutions to our customers. Development in the year The Company’s income statement for 2024 shows a loss of DKK 109,074k, which is considered very unsatisfactory, and below what was expected for 2024. The Company’s balance sheet as of 31 December 2024 shows a positive equity of DKK 32,378k.The result is heavily affected by the continuous gap between supply and demand – for Rhenus WS Denmark and the 3PL market in Denmark in general. Hence, the main challenge is still empty capacity, resulting in high fixed costs compared to revenue. Throughout 2024 Rhenus WS Denmark has onboarded several new customers, but at the same time, a few of Rhenus WS Denmark’s major customers has moved into own facilities and thereby resulting in additional empty square meters and led to greater misalignment between revenue and fixed costs. During 2024 the integration into the German parent company (‘Rhenus Logistics’) continued. The Company officially changes its name to Rhenus Warehousing Solutions Denmark A/S, new positions were created, and a lot of processes and procedures were improved. In addition, the relationship and cooperation with Rhenus Logistics have been strengthened - bringing synergies, support and new competencies to The Company and helping Rhenus WS Denmark evolve to a higher level. This transition, however, also comes with additional costs of both a one-off and permanent nature. *Subsequent events* The Company’s financial position as of 31 December 2024 and the results of the Company’s operations and its cash flow for 2024 are not affected by any unusual circumstances. *Outlook* Even-though Rhenus WS Denmark experienced positive trends in the second half of 2024, continuing into 2025, there is still a long journey towards achieving a positive monthly result. Rhenus WS Denmark managed to break the downward trend in the middle of 2024, and is now on the right track, but the mismatch between supply and demand will still have a huge impact on the 2025 results.In 2025, the integration of Rhenus WS Denmark into Rhenus Logistics will continue, meaning still additional costs on short term, but beneficial in the long term.For 2025 Rhenus WS Denmark expects a result which is better than 2024, with a loss before tax at a level between DKK 70,000k and DKK 90,000k. *Financial risks* Price risk: The Company is exposed to risks related to energy and certain raw materials such as packaging. The Company’s policy is to use market-related prices and, to the greatest extent possible, reflect these in the selling prices to its customers.Currency risk: As the Company’s transactions are exclusively made in either Danish kroner or Euro, the Company is not subject to any currency risk.Interest rate risk: The Company has significant variable rate assets and liabilities and is therefore exposed to interest rate risks.Credit risk: The Company’s primary credit risks are related to trade receivables. The single largest private-sector customer accounts for less than 10% of revenue and the single largest public sector customer accounts for less than 15% of revenue.Liquidity risk: The Company is exposed to liquidity risk due to considerable investments and fluctuating results. As a result, Rhenus WS Denmark is supported both in terms of liquidity and financial security by the parent company and the wider group. *Social and staff matters* The Company’s operations are located in Denmark where social and staff matters are, to a great extent, governed by legislation and established norms. In addition, the above-mentioned CoC applies to Rhenus WS Denmark, as does an employee handbook containing the policies and rules applicable in areas such as employee conditions, employee well-being and health and safety. It sets out Rhenus WS Denmark's values, the employees’ responsibilities and working conditions, as well as specific policies on how employees at Rhenus WS Denmark are expected to act with regard to well-being and safety. The employee handbook is updated regularly and shared with all employees.One of the most substantial risks faced by Rhenus WS Denmark in its day-to-day operations is the work-related injuries that employees may sustain in connection with their physical work.Actions taken during 2024 to comply with the Company's policies include: -The creation of a separate HR unit including hiring an HR-Business partner responsible for the day-to-day HR operations-Implementation of an annual HR cycle -Systematic, supplementary training of managers in management, staff care, etc. -Continuous follow-up on sickness absence-Regular stand-up meetings focused on topics such as safety, the ‘state of the union’, well-being, etc.-Awareness campaigns focused on safety and the environment-Meetings with lorry drivers on safety and well-being-Various social activitiesThe results of the above policies and actions are reflected in the general feedback from employees at Rhenus WS Denmark and low churn rate in multiple business areas.In addition to safety and well-being of the employees, social responsibility was still an area of focus in 2024, and Rhenus WS Denmark was once again awarded the CSR diploma award for social work with young people under the age of 29 by the Municipality of Horsens.Going forward, social responsibility as well as a focus on safety, development and well-being will continue to be highly prioritised. Additionally, employee branding and positioning as an attractive workplace will receive significant attention in 2025. *Environmental and climate issues* Rhenus WS Denmark is aware of its impact on the environment and the burden ensuing from the services it provides. The impact primarily stems from the energy consumption of Rhenus WS Denmark’s warehouse facilities and the emissions of the associated trucks.In this respect, too, Rhenus WS Denmark must comply with the CoC of its parent company. Among other things, the CoC states that the activities of the Company must pay attention to the careful use of natural resources, the continuous reduction of environmental impact and compliance with all environmental protection laws. In 2024, among others, the following initiatives were carried out with the environment in mind:-Continued focus on energy-conscious driving in the Transport department-Aiming to find initiatives and opportunities for reducing energy consumption and limiting the CO2 impact, the ’Green Team’ continued its work -Awareness campaigns focusing on safety and the environment-Waste separation on every location-Continued focus on energy consumption and how to reduce this; incl. developing a clear understanding of our current consumption -Started phasing out chemical usage in our washing facility used for our automated storage-Focus on more eco-friendly alternative for packaging-Supporting biodiversity by planting wildflowers in multiple areas next to our warehouses-Started process with landlord and potential suppliers, looking into the possibility of converting to heat pumps and installing solar panelsThe result is reflected in increased awareness across the organisation as well as already reduces usage of chemicals, and more eco-friendly packaging materials being used in the operation.The efforts to reduce energy consumption, and make eco-friendly choices, will continue in future. *Human rights* In this respect, too, Rhenus WS Denmark is subject to its parent company's CoC, which clearly states that Rhenus WS Denmark is to treat all employees equally and does not tolerate discrimination on the basis of ethnic origin, gender, religion, disability and age, etc. In addition, Rhenus WS Denmark respects a free choice of trade union and ensures that all rules and laws applicable regarding driving hours/rest periods and working hours, etc., are complied with. These views and policies are continuously communicated to the employees, and Rhenus WS Denmark has not found it necessary to take further action in 2024. Rhenus WS Denmark operates exclusively in Denmark, where fundamental human rights are governed by the law, which is why the risk of human rights violations appears to be minimal. The greatest risk of human rights violations exists in the supply chain, which is outside the control of Rhenus WS Denmark. In 2024, there were no breaches of the Company's CoC in relation to human rights, and, through ongoing communication and clear opinions, Rhenus WS Denmark is not expected to experience it in the future either. *Anti-corruption* In this respect, too, Rhenus WS Denmark must comply with the CoC of its parent company, which sets out its distancing from corruption. These views and policies are continuously communicated to the employees, and Rhenus WS Denmark has not found it necessary to take further action in 2024.Rhenus WS Denmark works exclusively in Denmark, which is why it is assessed that the risk of corruption is minimal.In 2024, no corruption was detected, and Rhenus WS Denmark will continue to work to prevent corruption in future. Uncertainty relating to recognition and measurement There has been no uncertainty regarding recognition and measurement in the Annual Report. Unusual events The financial position as of 31 December 2024 of the Group and the results of the activities and cash flows of the Group for the financial year for 2024 have not been affected by any unusual events.