Annual report
Page 1
ANNUAL AND SUSTAINABILITY REPORT2024
Page 2
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 CONTENTTHE YEAR IN BREAFSelected key figures, communicated events and historical development per quarter CEO STATEMENTCEO Simon Petrén summarizes the yearABOUT HUMBLEAn overview of our offering, platforms and value creation modelFINANCIAL & SUSTAINABILITY TARGETSUpdated financial targets that reflect our strategy and new sustainability targetsBUSINESS SEGMENTSFuture Snacking Sustainable CareQuality NutritionNordic Distribution 30461214 20222627 39GENERAL INFORMATIONAbout the sustainability reportSustainability governanceStakeholder engagementSustainability strategyBusiness model & value chainDouble materiality assessmentENVIRONMENTALEU Taxonomy reportClimate changeWater resourcesCircular economySOCIALOwn workforceWorkers in the value chainAPPENDIXAUDITOR’S ASSURANCE5570667711773134 2 BUSINESS OVERVIEW CORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT 28 137 CORPORATE GOVERNANCE REPORT BUSINESS OVERVIEW3 ANNUAL REPORTCORPORATE GOVERNANCEBOARD OF DIRECTORS & EXECUTIVE TEAMINTERNAL CONTROL OVER FINANCIAL REPORTINGTHE SHAREAUDITOR’S ASSURANCEMANAGEMENT ADMINISTRATION REPORTCONSOLIDATED FINANCIAL STATEMENTS & NOTESPARENT COMPANY FINANCIAL STATEMENTS & NOTESAUDITOR’S REPORTAPPENDIXDefinitions and calculation of key figuresMulti-year summary SUSTAINABILITY REPORT
Page 3
THE YEAR IN BRIEF KEY OPERATIONAL EVENTS DURING THE YEAR Q1 2024 5 5206 2566 7207 0507 2957 4467 6147 708407461492505531551566578Q12023Q22023Q32023Q42023Q12024Q22024Q32024Q42024 HISTORICAL DEVELOPMENT BY QUARTER Net SalesAdjusted EBITA Net Sales7,708MSEKNet Sales9%GrowthAdjusted EBITA7.5%Margin Gross Profit2,419MSEKGross Profit 31.4%MarginEBIT4.9%Margin Adjusted EBITA578MSEKEBIT376MSEK Humble formed a joint venture with the creators of ”Babblarna” with the intention to launch a series of children products. HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 20243 The sale of “Phase 2” of the property portfolio was completed.Q2 2024Q3 2024Q4 2024Our updated financial targets was presented and Humble held its first Capital Markets Day.IPO at Nasdaq Main Market Stockholm. Privab entered a strategic partnerships with Hemmakväll.Several capacity-related projects were fully implemented at various production sites - including Ewalco, Grahns Konfektyr, Franssons Konfektyr, and Bars Production - to meet high demand.Rolling 12 months The year in briefCEO statement About HumbleFinancial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 4
A STRONGER HUMBLE – VALUE CREATION IN FOCUSHow would you like to summarize 2024 for Humble Group?”We can establish that it has been a year characterized by strategic development with a focus on developing the existing businesses. We have continued the structural work tied to consolidation and integration of our businesses, within those areas where we have seen potential for further cost optimization and sales synergies. Production and distribution have been prioritized areas for us, where we have scaled and completed efficiency measures in production workflows to increase capacity levels, and to ensure we can meet demand. Concerning the general consumer trend, we note that own-branded products has had a continued strong development in the grocery trade, which has contributed to a positive development of our companies that produce and supply ready concepts to the retail chains. Within our hero brands, we have presented a record high number of new products compared to additional markets and retail chains. The significant increase in sales- and marketing efforts compared to last year is capital intensive, but we are already starting to reap positive outcomes of the newly established markets.”All in all, how did Humble Group perform during 2024?”We increased Net Sales with 9% to MSEK 7,708 (7,050), where the organic growth amounted to 8% driven by volume. Adjusted EBITA increased by 15% to MSEK 578 (505) and by 18% taking into account the divestment of the property portfolio. The gross margin strengthened to 31.4% (30%), a development which was foremost driven by a continued optimization of the product mix as well as more efficient purchasing strategies. Freight rates has not been in our favor given that we import large quantities of goods from Asia. This is something that could favor us going forward assuming today’s lower freight rates and a maintained level. Cash flows from operating activities amounted to MSEK 300 (1,088) where net working capital is a challenge given the Group’s high organic growth levels. Our ambition is to improve cash flow management and decrease the net working capital levels in relation to Net Sales, for the purpose of strengthening the balance sheet enable investments in organic growth initiatives as well as potential acquisitions.” 2024 was also incused by high volatility in raw material prices and supply chain disturbances. How are you working to manage these challenges? ”A challenging macro climate requires proactive strategies to meet unforeseen events, which is why we continuously evaluate how we can minimize our risk exposure. Among other initiatives, we have implemented co-coordinated freight agreements for “last-mile deliveries” for several of our Swedish distribution companies and are continuously evaluating new sourcing alternatives and choice of ingredients. We are also progressing well with the communicated initiative to centralize international freights, where the ambition is to be able to offer framework agreements and joint procedures for companies which businesses are dependent on favorable freight terms. Even though we are seeing significant progress in these areas, we remain humble in the face of the task of achieving full operational impact.”HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 20244 “We are no longer just a fast-growing FMCG group, we are a more mature Humble with a clear strategic direction” The year in briefThe year in briefCEO statementAbout Humble Financial & sustainability targetsBusiness SegmentBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 5
How do you view Humble Group's continued development? What are the greatest opportunities and challenges moving forward?”Our greatest opportunity lies in the strong and growing demand for our services and products, both in our existing core markets and in new, emerging markets. Our mix of own brands, production, and distribution gives us broad expertise across several parts of the value chain, which provides better opportunities to innovate and act more swiftly when launching new products. Like other companies in the industry, we are heavily exposed to price volatility and pressured margins in the supply chain. This requires us to continuously adapt and optimize our strategies and processes. Step by step, we are becoming a more mature company, and we still need to continue proving our competitiveness over time.Sustainability and the climate transition are important, especially for companies in the FMCG segment. Can you elaborate on how Humble Group is working with these issues?”Our framework for sustainability reporting and regulatory compliance has taken a significant portion of time and resources during both 2023 and 2024. We are convinced that a sustainability perspective is central to building long-term and resilient operations, which is why our new sustainability goals define some of the areas where we believe we can have the greatest impact."What will be your focus in the coming year?”First and foremost, we aim for effective execution of our strategic initiatives, and in 2025, we intend to achieve a higher conversion of the increased sales into profitability and cash flow, primarily through economies of scale within our current cost structure and more efficient working capital management. Once we reach a satisfactory debt level, we are also open to carrying out one or more smaller add-on acquisitions that strategically complement the group. We do this together and as a team, and I would therefore also like to take the opportunity to thank all our employees and other stakeholders for your continued commitment and support. Together, we have built a stronger Humble and taken one step closer to becoming the leading supplier of healthier consumer products.”Simon PetrénCEO, Humble Group HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 20245 ”2025 is about stepping up - the focus is on executing strategic initiatives, converting growth into profitability, strengthening cash flow, and continuing to build an even stronger Humble”During your Capital Markets Day this past fall, revised medium-term financial targets were presented. What is your strategy to achieve them?”The previous financial targets were adopted during a time when acquisitions and additional capital raises played a major role in the growth strategy. With our renewed strategic direction and the established platform, we have revised the financial targets to better reflect our long-term ambitions for the Group’s financial development.The cornerstone to achieving our growth target remains the underlying growth generated by our subsidiaries. In addition, the growth initiatives we are currently working on will contribute complementary growth. We also aim to strengthen profitability through a sequential recovery in gross margin and through the economies of scale that emerge as we continue to integrate and consolidate the business. Finally, we now have a significantly more favorable debt structure, and we will continue this path to gradually reduce our leverage relative to earnings.” The year in briefCEO statementAbout Humble Financial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 6
Humble specialize in driving value and accelerating growth in small and medium-sized FMCG companies. A MODERN AND ENTREPRENURIAL FMCG GROUP To lead the transformation towards healthier FMCG products in the consumer market. WHAT WE DOOUR OBJECTIVE An ecosystem rooted in a dynamic network of small and medium-sized businesses, led by ambitious entrepreneurs with vast industry experience. Active in the Consumer Packed Goods segment of the FMCG universe.Empowering our companies with strategic support for enhanced success. WHO WE ARE OUR STRATEGYHumble’s strategy is built on a decentralized governance combined with a vertically integrated business model. We optimize the collaboration between subsidiaries and offer central support functions to capitalize on synergies and value creation.HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 20246 The year in briefCEO statementAbout HumbleFinancial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 7
BRANDS AND PRODUCTS ~50%Comprise of products that are “better-for-you” or ”better-for-the-planet”* Humble sells more than40 000SKUs across multiple product categories Humble offers a wide range of brands that appeal to today’s modern consumer. With innovation and quality as guiding principles, we provide products in several growing categories:•Snacks & Confectionery -Candy, bars, and snacks with a focus on products that are sugar-reduced, high in protein, or based on natural ingredients.•Functional Beverages & Foods - Nutrient-rich drinks and consumer goods for a healthier lifestyle.•Health & Well-being - Dietary supplements, vitamins, and sports nutrition products that support energy and recovery.•Beauty & Personal Care- Beauty products including skincare, haircare, and dental.•Household & Home Care - Cleaning and everyday products for use both inside and outside the home. A SELECTION OF OUR BRANDS 7 * Products that, according to our definition, offer benefits for the consumer's health and/or the environment compared to conventional alternatives. The year in briefCEO statementAbout HumbleFinancial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 8
OUR INDUSTRIAL PLATFORM PortoCopenhagenGothenburgLjungSkövdeHöganäsJönköpingEkenäsFredriksforsLublinSheffield Sydney+440Unique producing suppliers in our global network Arena Nutrition- Consists of four companies: Natumin Pharma, Ewalco, Carls-Bergh Pharma, and Bars Production, focusing on contract manufacturing of sports nutrition, bars, dietary supplements, and functional drinks.Arena Confectionery - Consists of four companies: Grahns Konfektyr, Franssons Konfektyr, La Praline Scandinavia, and Grenna Konfektyr, which produce candy, caramels, pralines, and confectionery.Other Production Units - Independent production companies specialized in several categories, including personal care and healthier foods. In addition to these companies, we operate a bar production facility in Australia together with our local subsidiary, Body Science, manufacturing both our own brands and products for external customers. HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 Our industrial platform gives us the flexibility to innovate, adapt, and scale - from concept to market. Combined with a broad supplier network, we have strong capabilities to meet our customers’ needs. 8 Humble’s industrial platform combines innovation, quality, and efficiency to strengthen our position as a leading player in sustainable and healthy products.With 18 production units across seven countries, we manufacture a wide range of products within sports nutrition, dietary supplements, confectionery, healthier foods, and personal care.The Group’s industrial platform is complemented by an extensive network of over 440 external producers, providing a flexible and scalable production capacity to meet our customers’ needs. The year in briefCEO statementAbout HumbleFinancial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 9
Global distribution covering 82 marketsGlobal distribution covering 82 marketsOperating businesses in 17 countriesOperating businesses in 17 countries HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 A BROAD DISTRIBUTION NETWORK WITH GLOBAL REACH A STRONG DISTRIBUTION NETWORK THAT CREATES GROWTH OPPORTUNITIESOne of the biggest challenges for small and medium-sized companies is finding the right distribution partner -someone who not only understands their products but also has insights into how and in which channels they should be positioned and launched. A partner is needed who has both industry knowledge and operational strength to ensure that brands reach their full market potential.Humble has built a comprehensive distribution network through our strong wholesale and distribution companies, providing our brands and partners with an efficient route to market. With our own in-house teams, we create tailored strategies to optimize launches and maximize reach. Today, Humble has approximately 150,000 unique points of sales globally, covering 82 markets. In Sweden, we also have exposure in around 2,500 grocery stores, offering a strong position to help brands establish themselves in the retail sector.This presence allows us to rapidly test and evaluate new products, analyze consumer response, and adapt our strategy to changing market behaviors - a crucial factor in ensuring an agile and competitive business model.Our 13 distribution companies span a wide range of market-adapted product categories. This creates synergies and opportunities for effective and long-term growth within the Group. Through our strong market presence, deep industry expertise, and operational capabilities, we ensure that both our own and external brands have the best possible conditions for success.9 The year in briefCEO statementAbout HumbleFinancial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 10
VALUE CREATION MODEL7 AREAS WHERE WE CREATE VALUE FOR OUR SUBSIDIARIESSTRATEGIC FRAMEWORKDevelop and tailor long-term business plans for each subsidiary or platform.TREND TRANSFORMATIONSupporting our subsidiaries in adapting their product portfolios to meet the needs of future consumers.SUPPLIERSLeveraging Humble’s in-house production capabilities and external supplier network to optimize the value chain.PRODUCT DEVELOPMENTProviding the resources needed to launch new innovations, from concept to finished product.DISTRIBUTIONUtilizing Humble’s own channels and external distribution network to maximize market penetration.INVESTMENT RESOURCESProviding competitive financing solutions to support investment in value-creating growth opportunities.ADMINISTRATIVE SUPPORTOffering central support functions that reduce administrative burden and deliver ongoing services essential to the development of our subsidiaries.HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 202410 The year in briefCEO statementAbout HumbleFinancial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 11
TAILORED SYNERGIES BASED ON EACH COMPANY’S CAPABILITIES AND POTENTIAL LEVEL 1Shared resources, joint procurement, purchases and centralized function between subsidiaries. LEVEL 3Strategic, local synergies within platforms. LEVEL 2Vertical integration over the value chain, product development collaboration and cross selling. Humble’s work with synergies is structured across three levels to maximize value creation within the Group. This methodology ensures that synergies are identified and implemented based on the prerequisite and potential within each company and business unit.LEVEL 1: GROUP-WIDEStrategic efforts to identify and drive synergies that strengthen Humble as a whole. This includes coordination of long-term initiatives in innovation, sustainability, digitalization, and expansion. By pooling expertise from our companies, we accelerate growth, optimize resources, and enhance our market position. In addition, we ensure that structures, processes, and investments are designed to enable efficient scalability across the GroupLEVEL 2: VALUE CHAIN Operational and commercial synergies within product categories. By coordinating raw material sourcing, product development, and production, we create economies of scale and increase efficiency. We also identify opportunities for joint launches, cross-selling, and expansion within existing distribution channels. Thanks to our industrial platform and extensive distribution network, we can quickly adapt to market needs and optimize how we produce and deliver our products.LEVEL 3: PLATFORMSynergies are realized by consolidating and integrating companies into more streamlined business units, focusing on improving internal processes, sharing resources, and leveraging the subsidiaries’ competences to generate operational and financial advantages. Collaborations between companies can take place through shared production, logistics and distribution channels, or optimized sales strategies. HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 202411 The year in briefCEO statementAbout HumbleFinancial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 12
UPDATED FINANCIAL TARGETS HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 Average sales growth >15% per yearexcluding currency effectsActual 20249% GROWTH Driven by organic growth. Accelerated through execution of strategic growth initiatives.Complemented by acquired growth. PROFITABILITYTARGETEBIT margin10% medium-term Actual 20245%Continued positive development in the gross margin as a result ofstrategic Group initiatives. Strengthened EBIT margin from economies of scale in the operational cost base. Natural margin expansion from reduced amortization of customer relationships and capitalized development costs. TARGET CAPITAL STRUCTURE Net Debt / EBITDA>2.5x Actual 20242.8xPlanned amortization of bank loans. Growth investments with a return on invested capital exceeding 30%.Maintained Net debt / EBITDA in acquisitions.TARGET 12 The year in briefCEO statement About HumbleFinancial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 13
NEW SUSTAINABILITY TARGETS HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 Environmentally adapted production facilities that work systematically to reduce their environmental impact.Target 2030: 100% ISO 14001 certified production sitesBaseline 2024: 6% (1 out of 17 facilities)RESPONSIBLE PRODUCTIONIn 2024, five sustainability targets were established as a central part of our ambition to systematically advance toward a more sustainable business. We recognize our responsibility to uphold the highest standards of governance, transparency, and accountability. Clear sustainability targets enhance our long-term competitiveness, mitigate financial risks, and create opportunities to develop the business in line with both market demands and societal expectations.By setting concrete targets, we aim not only to drive innovation and resource efficiency but also to ensure meaningful contributions to a more sustainable future—for our customers, investors, and future generations. CLIMATE & ENERGYReduce climate impact through increased use of renewable energy sources.Target 2030: 100% renewable electricity and heating Baseline 2024: 89% CIRCULAR ECONOMYContribute to the transition to a circular economy by increasing the recyclability of our product packaging.Target 2030: 100% recyclable packagingBaseline 2024: 89% HEALTH & SAFETYEnsure safe and healthy workplaces for all employees by eliminating risks that cause workplace accidents.Target 2030: Zero severe workplace accidents*Baseline 2024: 28 EQUALITY & DIVERSITYCreate inclusive workplaces where diversity is seen as a strength and a driving force for innovation and growth.Target 2030: 60:40 Gender quota in Management PositionsBaseline 2024: 64:36* Workplace accidents that have resulted in any of the following: medical treatment beyond first aid, one or more days of absence from work, restricted work or reassignment to another role, diagnosis of a serious injury or illness, loss of consciousness, or death. 13 The year in briefCEO statement About HumbleFinancial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 14
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 BUSINESS SEGMENTS The Group’s operations are divided into four business segments: Future Snacking, Sustainable Care, Quality Nutrition, and Nordic Distribution. These segments comprise companies active across multiple parts of the value chain, including production, branding, and distribution. Leading the transformation towards healthier snacks and confectioneryFUTURE SNACKINGNatural brands and a trusted partner in personal and home careSUSTAINABLE CARE Contract manufacturing and strong brands in sports nutrition and dietary supplementsQUALITY NUTRITIONWholesale and distribution partners that accelerate growth for our companiesNORDIC DISTRIBUTION Net Sales975MSEKGross Profit442MSEKAdj. EBITA92MSEK Net Sales+4%GrowthGross Profit45%MarginAdj. EBITA9%Margin Net Sales2,409MSEKGross Profit887MSEKAdj. EBITA278MSEK Net Sales+10%GrowthGross Profit37%MarginAdj. EBITA12%Margin Net Sales1 536MSEKGross Profit483MSEKAdj. EBITA106MSEK Net Sales+5%GrowthGross Profit31%MarginAdj. EBITA7%Margin Net Sales2 787MSEKGross Profit606MSEKAdj. EBITA98MSEK Net Sales+14%GrowthGross Profit22%MarginAdj. EBITA4%Margin14 The year in briefThe year in briefCEO statementAbout Humble Financial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 15
FUTURE SNACKINGLeading the transformation towards healthier snacks and confectionery HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 •Grahns Konfektyr*•Franssons Konfektyr*•Grenna Konfektyr*•La Praline*•True Co.•Pändy•Wellibites•Soya Oy•Kryddhuset•LEV Group•First Class Brands•True Co. launched True Dates - a success that quickly captured significant market share. True Co. also changed its name from True Gum, in line with the strategy of building multiple product categories under the company.•Pändy continued its exponential growth and strengthened its presence in several international markets. In Norway, Pändy has captured a substantial share of the packed candy category.•The companies within Arena Confectionary developed steadily, both in terms of growth and profitability.* Demand at our production units remains high, and Humble is therefore continuously working to optimize capacity and invest in future growth.•First Class Brands underwent a restructuring to minimize the operational cost base and create the right conditions for a sustainable business model.20232024Key ratios, MSEK936975Net Sales404442Gross Profit6492Adjusted EBITA2951Adjusted EBIT 13%Share of Net Sales16%Share of Adjusted EBITA20%1%79%ContractManufacturingDistributionBrandsNet Sales split Future Snacking offers healthier options in candy, snacks, and food products. By combining innovation, quality, and taste, Humble aims to remain a leading provider of better alternatives within the confectionery and snack segments. 15 Summary of the yearReporting subsidiaries Arena ConfectionaryProduction unit BrandsLeading brands * Part of the Arena Confectionary platform The year in briefCEO statement About Humble Financial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 16
SUSTAINABLE CARENatural brands and a trusted partner in personal and home careNatural brandsRetail partner HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 31%Share of Net Sales48%Share of Adjusted EBITA44%15%41%ContractManufacturingDistributionBrandsNet Sales split Sustainable Care offers innovative products in the personal care and household categories. The segment includes companies operating across the entire value chain - from production and branding to distribution. •Solent Group•Amber House•The Humble Co.•Eco by Naty•Fancystage•Delsbo Candle•Marabu•Solent Group, the largest subsidiary in the segment, continued to show strong growth with a stable operating margin. During the year, Go Superfoods was integrated, where the Group sees great potential in leveraging Solent Group’s infrastructure to accelerate growth and reduce the operational cost base.•Amber House continued its strong growth, driven by the launch of licensed products and exclusive distribution agreements for innovative products.•Naty underwent a leadership transition, with Johanna Sjöborg taking over as CEO. In connection with the succession, organizational restructurings were implemented. The company has simultaneously shown a positive trend shift, with strong prerequisites for long-term business growth and increased profitability margins.•Marabu initiated a reorganization, and Group management has taken a more active role in implementing significant strategic changes within the company.20232024Key ratios, MSEK2,1972,409Net Sales784887Gross Profit255278Adjusted EBITA114177Adjusted EBIT16 Eco by Naty and The Humble Co.Solent as private label partner leading retail chains. Summary of the yearReporting subsidiaries The year in briefCEO statement About Humble Financial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 17
QUALITY NUTRITIONContract manufacturing and strong brands in sports nutrition and dietary supplementsArena NutritionNordic producer and supplier of nutrition productsBody ScienceAustralia’s leading brands within sport nutritionOther brandsStrand brands across various nutrition categories HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 20%Share of Net Sales48%Share of Adjusted EBITA51%3%46%ContractManufacturingDistributionBrandsNet Sales split •Bars Production •Bars Production Australia•Ewalco•Natumin Pharma•Carls-Bergh Pharma•Body Science•Go Superfoods•Vitargo•Golden Athlete•Performance R Us•Viterna•BSc Europe•The drinks facility in Habo was completed during the fourth quarter for full-scale production, strengthening production capacity and enabling contract manufacturing of functional drinks for both external and internal customers.•The production of dry goods was separated from Ewalco and relocated to new premises. The carve out now operates under the name Amazing Foods.•The relocation of dry goods production from Ewalcoenabled renovation and the implementation of a second shift in powder production.•Bars Production in Sweden installed a fifth production line to increase manufacturing capacity.•BSc Europe was launched in Sweden, offering products in sports nutrition, bars, and functional drinks. •The Vitargo brand was relaunched, offering performance-enhancing nutrition products.20232024Key ratios, MSEK1,4621,536Net Sales432483Gross Profit114106Adjusted EBITA8578Adjusted EBIT17 Quality Nutrition combines contract manufacturing and strong brands within the categories of sports nutrition, bars, dietary supplements, and functional beverages. Humble offers a wide range of products tailored to a growing and increasingly health-conscious consumer base. Summary of the yearReporting subsidiaries The year in briefCEO statement About Humble Financial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 18
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 NORDIC DISTRIBUTIONWholesale and distribution partners that accelerate growth for our companiesSwedenWholesaleNordicsLocal distribution in niche categories Nordic Distribution comprises wholesale and distribution operations across the Nordic region, with a strong presence primarily in Sweden. The segment serves as a growth platform for both the Group’s own brands and external customers. In addition to the Swedish operations, it includes local distributors in other Nordic countries -particularly in Norway - focused on sports nutrition, dietary supplements, and functional foods.36%Share of Net Sales17%Share of Adjusted EBITA 32%24%22%13%4%4%1%DiscountWholesaleGroceryService tradeFitnessConveniencePharmacyNet Sales by channel •Privab•Green Sales Distribution•Be:Son Gross •Vitalkost•Fitnessgrossisten•Privab signed a long-term strategic partnership agreement with Hemmakväll to supply candy and snacks to their 69 stores across Sweden, starting January 1, 2025. •A leadership transition took place at Privab, where the former CEO of Privab Trollhättan, Niklas Andersson, assumed the role of group CEO.•Green Sales Distribution launched Hell Ice Coffee and Hell Energy, both of which received a strong market response.•The ongoing integration of Privab units led to synergies in the supply chain. Humble also expanded investments in digital offerings and warehouse optimization to improve efficiency.•Vitalkost continued to deliver strong growth. Driving factors of growth included the licensed partnership with Kolonihagen and the launch of True Dates in Norway in collaboration with True Co.20232024Key ratios, MSEK2,4552,787Net Sales509606Gross Profit7998Adjusted EBITA5874Adjusted EBIT18 Summary of the yearReporting subsidiaries The year in briefCEO statement About Humble Financial & sustainability targetsBusiness segmentsBUSINESS OVERVIEWCORPORATE GOVERNANCE SUSTAINABILITY ANNUAL REPORT
Page 19
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 CORPORATE GOVERNANCE 19
Page 20
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 INTRODUCTIONHumble Group AB (“Humble”) is a Swedish public limited company, registered under corporate identification number 556794-4797, with its headquarters in Stockholm. As of September 27, 2024, Humble is listed on Nasdaq Stockholm Mid Cap. Prior to this, the company was listed on the Nasdaq First North Growth Market since 2014. The corporate governance report aims to provide key information on how Humble complies with the Swedish Corporate Governance Code and how the Group’s ownership governance is structured. The report offers insights into how Humble organizes its operations, from decision-making at the General Meeting to how decisions are enforced and implemented within the organization. This Corporate Governance report has been reviewed by the Group’s auditors, BDO, and the results of the statement is presented on page 28 of this Annual and Sustainability report.CORPORATE GOVERNANCE FRAMEWORKCorporate governance at Humble is based on principles derived from various external and internal regulatory frameworks. External frameworks include Swedish legislation and regulations (such as the Annual Accounts Act, the Companies Act, and the Market Abuse Regulation), as well as the Nasdaq Nordic Main Market Rulebook for Issuers. Humble also complies with the Swedish Corporate Governance Code (the “Code”) and applies the “comply or explain” principle. During 2024, no deviations from the Code were recorded.Internal frameworks include the Articles of Association, adopted by the general meeting, as well as internally established governance documents such as the Board’s Rules of Procedure, the CEO’s Instructions, the Humble Code of Ethics, and various guidelines, policies, and other internal instructions. The Board reviews these internal documents annually to ensure their relevance and updates them as required. In 2024, the Board continued to develop Humble’s sustainability efforts, including the adoption of strategic sustainability targets through 2030. More detailed information on Humble’s sustainability work can be found in the Sustainability Report on pages 29–69.ANNUAL GENERAL MEETING The annual general meeting (AGM) is the Group’s highest decision-making body and provides all shareholders the opportunity to exercise influence over, for example, the composition of the Board of Directors, election of auditors, and remuneration for the Board and auditors. The AGM also decides on changes to the Articles of Association and authorizations for the board. CORPORATE GOVERNANCE 20 The AGM also decides on the approval of the income statement and balance sheet, the appropriation of the Group’s profit or loss in accordance with the approved balance sheet, and the discharge of the Board of Directors and the CEO from liability. The Articles of Association do not impose any restrictions on how many votes each shareholder may cast at the annual general meeting, nor are there any special provisions concerning decisions on amendments to the Articles of Association. Decisions at the AGM are generally made by simple majority. At the AGM, shareholders have the opportunity to ask questions about the Group and its financial performance over the past year. Representatives from the Board and Group management are typically present at the AGM to answer such questions. The most recent AGM was held in Stockholm on May 22, 2024, with a total of 156,594,916 shares represented, corresponding to 35.3% of the total number of shares. The AGM resolved, in accordance with the Nomination Committee’s proposals, the following:•Adoption of the income statement and balance sheet for the 2023 financial year•Appropriation of the company’s results•Discharge from liability for the Board members and the CEO for their management during 2023•Determination that the Board shall consist of six members without deputies•Resolution on fees to the Chair of the Board, Board members, and for work in the Audit and Remuneration Committees•Resolution on fees to the company’s auditor in accordance with approved invoices•Election of Noel Abdayem as a new Board member and re-election of Dajana Mirborn, Pål Bruu, Ola Cronholm, Sara Berger, and Henrik Patek as Board members•Dajana Mirborn was elected Chair of the Board•Re-election of BDO Mälardalen AB as the company’s auditor until the end of the next AGM•Resolution on guidelines for the appointment of the Nomination Committee•Resolution on remuneration guidelines for senior executives•Resolution on amendments to the Articles of Association•Authorization for the Board to decide on new issues of shares, warrants, and convertibles•Resolution on the implementation of an incentive program, issuance of warrants series 2024/2027, and approval of the transfer of warrantsThe minutes with all adopted resolutions are available at www.humblegroup.se.The next AGM will be held in Stockholm on May 21, 2025. BUSINESS OVERVIEWCORPORATE GOVERNANCESUSTAINABILITY ANNUAL REPORTInternal Control The ShareAuditor’s ReportBoard of Directors & Executive Team Corporate Governance
Page 21
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 HUMBLE’S GOVERNANCE MODELNOMINATION COMMITTEERENUMERATION COMMITTEEANNUAL GENERAL MEETINGBOARD OF DIRECTORSCEO AND GROUP MANAGEMENTSUBSIDIARIESEXTERNAL AUDITORAUDIT COMITTEENOMINATION COMMITEEThe Nomination Committee prepares and submits proposals to the annual general meeting regarding the election of the Chair of the meeting, members of the Board of Directors, the Chair of the Board, and the Group’s auditors. It also proposes the remuneration for each Board member and the Chair, potential compensation for committee work, and the auditor’s fee. In accordance with the principles for the Nomination Committee adopted by the AGM, Humble shall have a Nomination Committee consisting of four members, including the Chair of the Board. These members shall include the Chair of the Board and one representative appointed by each of the three largest shareholders in terms of voting power as of the end of the third quarter of the year preceding the AGM. COMPOSITION OF NOMINATION COMMITEE 2024Share of votes as per2024-09-30Independence1RepresentingMember10.40%Yes / NoNeudi & C:o ABKristina Brandt10.33%Yes / NoRoosgruppen ABHenrik Patek6.27%Yes / NoNCPA Capital ABRasmus Widell0%YesChairman of the BoardDajana Mirborn¹ Independent in relation to the Group / Independent in relation to the Group’s major shareholders BOARD OF DIRECTORSBoard members are elected at the AGM for the period until the end of the next AGM. The Articles of Association contain no restrictions regarding the eligibility, appointment, or dismissal of Board members. According to the Articles, the Board shall consist of no fewer than three and no more than seven members elected by the AGM, with a maximum of three deputy members. When appointing new Board members, efforts are made to achieve gender balance, alongside an evaluation of the members' competencies. The Board is responsible for ensuring that the Group’s organization is appropriate and that operations are conducted in accordance with the Articles of Association, the Swedish Companies Act, and other applicable laws, guidelines, and regulations. The Chairman of the Board is elected by the AGM and holds specific responsibility for leading the work of the Board in an efficient, well-organized manner to ensure the Board fulfills its duties. The Chairman is also responsible for evaluating the work of the Board. The independence of Board members in relation to the Group and its management is outlined on the following page. Noel Abdayem is part of the Group’s operational management team. None of the other Board members are employed within the Group. 21 BUSINESS OVERVIEWCORPORATE GOVERNANCESUSTAINABILITY ANNUAL REPORTBoard of Directors & Executive Team Internal Control The ShareAuditor’s ReportCorporate Governance
Page 22
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 BOARD OF DIRECTORS & EXECUTIVE TEAMBOARD OF DIRECTORSAt the 2024 AGM, Dajana Mirborn, Henrik Patek, Ola Cronholm, Pål Bruu, and Sara Berger were re-elected as members of the Board of Directors. Noel Abdayem was elected as a new Board member in accordance with the Nomination Committee’s proposal. Furthermore, the AGM elected Dajana Mirborn as Chair of the Board.DAJANA MIRBORNCHAIRMAN OF THE BOARDShares: 83,021Year of birth: 1980Board member since 2021Independent in relation to the Group, the Executive Team and major shareholders of the Group.Education: Master’s degree from the University of Gothenburg, Executive Education from INSEAD, studies in Mechanical Engineering from Chalmers University of Technology.Other assignments: Investment Manager at Creades, Board Member at Karnell Group (publ), Försäkringsaktiebolaget Avanza Pension, Röhnisch, and Mentimeter.HENRIK PATEKBOARD MEMBERShares: 207,500Year of birth: 1969Board member since 2021Independent in relation to the Group and Executive Management. Not independent in relation to major shareholders of the Group.Education: University studies in Computer Science and Economics.Other assignments: Investment Manager at RoosGruppen AB.OLA CRONHOLMBOARD MEMBERShares: 100,000Year of birth: 1973Board member since 2022Independent in relation to the Group and Executive Management. Not independent in relation to major shareholders of the Group.Education: Master’s degree in Financial Economics from the School of Business, Economics and Law at the University of Gothenburg.Other assignments: Investment Manager at Neudi & Co, Board Member of, among others, Cellmark AB, Wint Group AB, and SWG AB. PÅL BRUUBOARD MEMBERShares: 350,952Year of birth: 1969Board member since 2023Independent in relation to the Group, the Executive Team and major shareholders of the Group.Education: MSc from BI Norwegian Business School.Other assignments: Chairman of the Board at Safira.com and Norsk Bildelsenter, in addition to running independent consulting and advisory activities.SARA BERGERBOARD MEMBERShares: 17,000Year of birth: 1978Board member since 2023Independent in relation to the Group, the Executive Team and major shareholders of the Group.Education: MBA från Ekonomihögskolan vid Lunds Universitet.Other assignments: CEO of Sproud, Board involvement in Matilda Food Tech, Svenska Retursystem AB and the trade organization for the grocery industry DLF.NOEL ABDAYEMBOARD MEMBERShares: 28,103,255 Year of birth: 1991Board member since 2024Not independent in relation to the Group and Executive Management. Not independent in relation to major shareholders of the Group.Education: Licensed Dentist from Riga StradinsUniversity, MBA from Stockholm School of EconomicsOther assignments: Deputy CEO of Humble Group AB, Chairman of the Board at Five Guys Scandinavia, Aurezzi, and Dentme. 22 BUSINESS OVERVIEWCORPORATE GOVERNANCESUSTAINABILITY ANNUAL REPORTInternal Control The ShareAuditor’s ReportBoard of Directors & Executive Team Corporate Governance
Page 23
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 CHIEF EXECUTIVE OFFICER AND EXECUTIVE MANAGEMENTThe Group’s Chief Executive Officer, Simon Petrén, is responsible for the day-to-day management of the Group, as well as for preparing and presenting matters to the Board of Directors that fall outside of day-to-day operations. As of the end of 2024, Humble’s Executive Management team consisted of Chief Executive Officer Simon Petrén, Deputy CEO Noel Abdayem, Chief Financial Officer Johan Lennartsson, Chief Operating Officer Marcus Stenkil, and Chief Analytics Officer Kristoffer Zinn.SIMON PETRÉNCHIEF EXECUTIVE OFFICERShares: 6,660,000Year of birth: 1989Simon holds a Master’s degree in Mechanical Engineering with a specialization in Product Innovation Management from KTH Royal Institute of Technology and has also studied Business Administration at Stockholm University. He is the co-founder of the subsidiary PÄNDY and served as its CEO until the company became part of Humble. Simon has previously worked as a Business Intelligence Analyst at Nordea and has ten years of experience in capital markets, investments, strategic development, and growth in startups, as well as small and medium-sized enterprises. Simon is also a Board Member of Refine Group.NOEL ABDAYEMDEPUTY CEOShares: 28,103,255Noel is a licensed dentist and the founder of the subsidiary The Humble Co. As an entrepreneur, he has been recognized with several awards, including Swedish Newcomer of the Year by H.M. King Carl XVI Gustaf, Young Entrepreneur of the Year, EY Entrepreneur of the Year, and Prince Daniel’s Entrepreneurial Award. Through his company NCPA Capital, he is the fourth largest shareholder in Humble. 23 JOHAN LENNARTSSONCHIEF FINANCIAL OFFICERShares: 208,968Johan holds a Bachelor’s degree in Business Administration from the School of Business, Economics and Statistics at Umeå University and the University of New Brunswick in Canada. He previously worked as an authorized public accountant at PwC, focusing on auditing large publicly listed companies.MARCUS STENKILCHIEF OPERATING OFFICERShares: 153,090Marcus holds a Bachelor’s degree in Economics from the School of Business, Economics and Law at the University of Gothenburg. Before joining Humble, Marcus served as CFO at The Humble Co., and prior to that, worked as an auditor at EY in both Sweden and the United States, focusing on large publicly listed companies and capital market transactions.KRISTOFFER ZINNCHIEF ANALYTICS OFFICERShares: 135,172Kristoffer has extensive experience in analytics and business intelligence from previous roles at Nordea Wealth Management and Pierce Group. He holds a Master’s degree in Industrial Engineering and Management from KTH Royal Institute of Technology. BUSINESS OVERVIEWCORPORATE GOVERNANCESUSTAINABILITY ANNUAL REPORTInternal Control The ShareAuditor’s ReportBoard of Directors & Executive Team Corporate Governance
Page 24
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 BOARD OF DIRECTORS WORKThe Board of Directors at Humble is responsible, among other duties, for appointing, evaluating, and, if necessary, dismissing the Group’s Chief Executive Officer; setting the Group’s overall goals and strategy; identifying how sustainability issues impact the Group’s risks and business opportunities; ensuring compliance with laws and regulations; and overseeing the monitoring and control of risks within the Group’s operations. Key matters addressed by Humble’s Board during 2024 included the Group’s overall strategy, objectives, preparatory work for the stock exchange listing transfer, refinancing of the capital structure, and significant investments and divestments. In 2024, the Board held 22 meetings (including the statutory inaugural meeting).In accordance with Section 9.1 of the Swedish Corporate Governance Code, the Board conducted an evaluation of its work during the year. The evaluation was carried out via a questionnaire provided by an external third party, and the results were presented to the Nomination Committee. The Board also evaluated the performance of the CEO. The Chair of the Board maintains an ongoing dialogue with the CEO regarding the status of operational matters, and the Board conducts an annual review of the CEO’s performance when assessing the outcome of the CEO’s variable compensation.AUDIT COMMITTEEThe Audit Committee consists of Ola Cronholm (Chair of the Committee), Pål Bruu, and Sara Berger. All members of the Committee are independent of the Group and its Executive Management. Remuneration CommitteeAudit CommitteeBoard MeetingsPeriodPositionMember/Advisor3/3-22/222024ChairmanDajana Mirborn3/3-21/222024MemberHenrik Patek1/3*10/1021/222024MemberOla Cronholm*-10/1022/222024MemberPål Bruu-5/6*20/222024MemberSara Berger*--13/2222 May 2024MemberNoel Abdayem31022Number of meetings during the year*Ola Cronholm participate in the Remuneration Committee and Sara Berger in the Audit Committee from the AGM 22 May2024. 24 The responsibilities of the Audit Committee are set out in Chapter 8, Section 49b of the Swedish Companies Act and Rule 7.2 of the Swedish Corporate Governance Code. These responsibilities include overseeing the Group’s financial reporting, management estimates and judgments, the effectiveness of internal controls, and maintaining ongoing communication with the Group’s external auditors. Additionally, the Committee evaluates the auditors’ work, qualifications, and independence. The Audit Committee monitors developments in accounting principles and reporting requirements, discusses other material matters related to the Group’s financial reporting, and reports its findings to the Board. The Committee is required to meet at least five times per year. In 2024, it held ten meetings. The meetings are minuted and the minutes are reported to the Board at the next scheduled Board meeting.AUDITORAccording to the Articles of Association, Humble shall have a minimum of one and a maximum of two auditors, or a registered audit firm. The auditor’s mandate extends until the end of the next AGM. At the 2024 AGM, the audit firm BDO Mälardalen AB was elected to serve until the 2025 AGM. The lead authorized public accountant representing BDO Mälardalen AB is Carl-Johan Kjellman, born in 1974.The auditor’s independence is ensured through legislation, professional ethical standards, and the audit firm’s internal guidelines, as well as the Audit Committee’s policies on which assignments the audit firm may undertake in addition to the statutory audit. For more information, see Note 7 Auditor’s Fees for the Group and Note 40 Auditor’s Feesfor the Parent Company. BUSINESS OVERVIEWCORPORATE GOVERNANCESUSTAINABILITY ANNUAL REPORTInternal Control The ShareAuditor’s ReportBoard of Directors & Executive Team Corporate Governance
Page 25
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 REMUNERATION COMMITTEEThe Remuneration Committee consists of Dajana Mirborn (Chair of the Committee), Henrik Patek, and Ola Cronholm. The duties of the Remuneration Committee are primarily outlined in Rule 7.3 of the Swedish Corporate Governance Code and include preparing matters related to remuneration policies, compensation (such as salaries, pension terms, and incentive programs), and other terms of employment for senior executives. The Committee aims to meet twice per year and more frequently if necessary. In 2024, the Committee held three meetings. All meetings are minuted and reported to the Board at the next scheduled Board meeting. The Remuneration Committee is also responsible for ensuring compliance with the guidelines for remuneration to senior executives as resolved by the AGM. This follow-up is documented in a separate Remuneration Report, which is available at www.humblegroup.se. GUIDELINES FOR REMUNERATION TO SENIOR EXECUTIVESThe guidelines for remuneration to senior executives at Humble were adopted by the 2024 AGM based on a proposal from the Board of Directors and will remain in effect until the 2028 AGM at the latest. The guidelines apply to the CEO and members of the Executive Management team who report directly to the CEO. They do not cover remuneration resolved by the AGM, such as fees to Board members or share-based incentive programs. The guidelines govern the overall remuneration framework prepared by the Board’s Remuneration Committee and decided upon by the full Board in matters concerning the CEO and Executive Management. These guidelines shall apply both to new agreements and to any changes in already agreed remuneration. 25 To safeguard Humble’s long-term interests and sustainability, the Group must be an attractive employer. A key condition for achieving this is offering a competitive compensation package in order to attract and retain skilled senior executives. Consequently, total remuneration must be competitive, aligned with market practices, and linked to the relevant individual’s responsibilities and performance. All remuneration covered by these guidelines shall aim to promote the Group’s business strategy, long-term interests, and sustainability. Compensation should be market-based and may, as outlined above, consist of fixed cash salary, variable cash compensation, as well as pensions and similar benefits. In addition, the AGM may, independently of these guidelines, decide on share-based and share price-related remuneration. All AGMs since 2021 have resolved to implement long-term incentive programs involving long-term variable remuneration for senior executives and key personnel within the Group. Short-term variable compensation is expensed during the financial year and paid out after year-end when a reliable outcome can be determined. The guidelines adopted by the 2024 AGM have been followed. BUSINESS OVERVIEWCORPORATE GOVERNANCESUSTAINABILITY ANNUAL REPORTInternal Control The ShareAuditor’s ReportBoard of Directors & Executive Team Corporate Governance
Page 26
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 THE BOARD’S REPORT REGARDING INTERNAL CONTROLThe Board of Directors is, in accordance with the Swedish Companies Act and the Corporate Governance Code, responsible for ensuring that the Group has effective internal control and structured processes in place to ensure compliance with established principles for financial reporting. This description has been prepared in accordance with Sections 7.3 and 7.4 of the Code and Chapter 6, Section 6 and Chapter 7, Section 31 of the Annual Accounts Act, and is therefore limited to internal control related to financial reporting.CONTROL ENVIRONMENTThe Board’s rules of procedure and the instructions for the CEO and the Board’s committees are intended to ensure a clear division of roles and responsibilities, contributing to the effective management of the Group’s operational and financial risks. The Board shall ensure that the Group has formalized procedures in place to secure compliance with established principles for financial and sustainability reporting, as well as internal control. Furthermore, the Board shall ensure that the Group’s financial reporting is prepared in accordance with applicable laws, accounting standards, and other requirements for listed companies. The Group’s management is responsible for maintaining the internal control framework required to address risks in ongoing operations and regularly reports to the Audit Committee and the Board in accordance with established procedures. The internal control framework is subject to an annual review and is based on a comprehensive analysis of changes in the Group’s risk profile and risk environment. RISK ASSESSMENT AND CONTROL ACTIVITESThe Board of Directors at Humble is responsible for ensuring that a comprehensive risk assessment is conducted and that appropriate control activities are implemented to address such risks. The Group’s management is responsible for the implementation and evaluation of these control activities. Humble follows a documented approach and continuously evaluates the effectiveness of controls to cover material risks of errors in accounting and financial reporting. The most significant items and processes where the risk of material misstatement typically exists include income statement and balance sheet items such as intangible assets, goodwill, and the accounting of contingent consideration. INTERNAL CONTROL REGARDING FINANCIAL REPORTING 26 INTERNAL AUDIT AND THIRD-PARTY REVIEWSThe Board evaluates the need for a separate internal audit function on an annual basis. Humble currently does not have a dedicated internal audit function. Internal reviews are carried out on an ongoing basis, taking into account the size of the Group’s operations, inherent risks, and complexity. The results of such internal reviews are reported in writing to the Audit Committee. In addition, the company’s external auditors also review parts of the internal control framework implemented, as part of the overall external audit. The results of such reviews are reported annually to the Audit Committee, with a focus on deviation-based reporting. During the 2024 financial year, the Board held a separate meeting with the company’s auditor without the presence of the CEO or any other member of Executive Management. INFORMATION AND COMMUNICATIONHumble’s Finance Policy, Risk Management & Internal Control Procedure, and other guidelines relevant to financial reporting are updated at least once per year. Both formal and informal communication channels exist to ensure that material information from employees reaches company management and the Board. Humble has established guidelines for external communication through an internal information policy to ensure effective and accurate communication. For external communication, the Group has compiled guidelines in an information policy to ensure that the company meets high standards for accurate disclosure to the market and other stakeholders, such as shareholders, board members, employees, and suppliers.MONITORINGThe Board continuously evaluates the information provided by Group Executive Management and the Audit Committee. The Board places particular focus on monitoring the effectiveness of internal control and management’s efforts in this area. This work includes ensuring that appropriate actions are taken in response to deficiencies and recommendations identified during internal and external audits. BUSINESS OVERVIEWCORPORATE GOVERNANCESUSTAINABILITY ANNUAL REPORTInternal ControlThe ShareAuditor’s ReportBoard of Directors & Executive Team Corporate Governance
Page 27
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 At the end of the financial year, a total of 446,575,533 (443,544,543) shares were listed for trading. The Group does not hold any treasury shares and has not acquired any of its own shares during 2024.During the financial year, the number of shares increased by 3,030,990 (10,685,963) through non-cash issues, 0 (131,585,000) through directed cash issues, and 0 (0) through the exercise of warrants.For more information about the share and its quota value, see Note 53 Share Capital. There is only one class of shares, and all shares carry equal voting rights. THE SHARE VotesSharesOwner10.40%46,435,778Neudi & C:o AB10.33%46,134,786Håkan Roos (RoosGruppen)6.72%30,000,000Capital Group6.29%28,103,255Noel Abdayem (NCPA Capital AB)5.83%26,021,235Alta Fox Capital5.55%24,772,112Avanza Pension3.25%14,523,852Nordnet Pensionsförsäkring2.91%13,000,000Jofam AB2.67%11,908,382Swedbank Försäkring2.17%9,676,171DNB Asset Management SA56.1%250,575,571Total top 1043.9%195,999,962Other shareholders100%446,575,533Total number of sharesNo. of votesNo. of sharesNo. of shareholdersShareholding0.35%1,550,58410,9261 - 5004.44%19,838,5526,362501 - 20 0003.35%14,956,58236720 001 - 100 0003.82%17,076,86581100 001 - 500 0001.78%7,959,59112500 001 - 1 000 0001.12%5,019,86941 000 001 - 2 000 00066.86%298,584,689212 000 001 -18.27%81,588,801Anonymous ownership100%446,575,53317,773Total 27 Humble Group AB has been listed under the ticker HUMBLE on Nasdaq Stockholm since September 27, 2024. Prior to that, Humble was listed on Nasdaq First North since November 2014.TOP 10 LARGEST SHAREHOLDERSThe ultimate governance of the Group is exercised by the shareholders, who influence the overall direction through their participation at the AGM. Below is a summary of Humble’s 10 largest shareholders, along with a breakdown of share ownership based on the number of shares held as of the record date February 28, 2024. BUSINESS OVERVIEWCORPORATE GOVERNANCESUSTAINABILITY ANNUAL REPORTInternal ControlThe ShareAuditor’s ReportBoard of Directors & Executive Team Corporate Governance
Page 28
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 AUDITOR’S REPORT ON THE CORPORATE GOVERNANCE STATEMENTENGAGEMENT AND RESPONSIBILITYIt is the Board of Directors who is responsible for the corporate governance statement for the year 2024 on pages 19-27 and that it has been prepared in accordance with the Annual Accounts Act.THE SCOPE OF THE AUDITOur examination has been conducted in accordance with FAR’s standard RevR 16. The auditor’s examination of the corporate governance statement. This means that our examination of the corporate governance statement is different and substantially less in scope than an audit conducted in accordance with International Standards on Auditing and generally accepted auditing standards in Sweden. We believe that the examination has provided us with sufficient basis for our opinions.OPINIONSA corporate governance statement has been prepared. Disclosures in accordance with chapter 6 section 6 the second paragraph points 2-6 the Annual Accounts Act and chapter 7 section 31 the second paragraph the same law are consistent with the annual accounts and the consolidated accounts and are in accordance with the Annual Accounts Act.Date and signature on the Swedish originalBDO Mälardalen ABCarl-Johan KjellmanAuthorized Public Accountant AUDITOR’S REPORT 28 BUSINESS OVERVIEWCORPORATE GOVERNANCESUSTAINABILITY ANNUAL REPORTInternal Control The ShareAuditor’s ReportBoard of Directors & Executive Team Corporate Governance
Page 29
SUSTAINABILITY REPORT 2024 29HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024
Page 30
BASIS F0R PREPARATIONREPORTING PRINCIPLES & FRAMEWORKSHumble’s Sustainability Report for 2024 follows the Group’s financial year and covers the period from January 1, 2024, to December 31, 2024. The reporting is consolidated and includes subsidiaries with physical facilities and at least one employee, in contrast to the financial reporting which includes all legal entities, even those without operational activities. See the appendix on page 66 for the subsidiaries included in the report. The Sustainability Report is published annually and is prepared in accordance with the Swedish Annual Accounts Act (ÅRL), applicable until June 30, 2024. It is guided by the European Sustainability Reporting Standards (ESRS) to progressively align the reporting with the EU’s CSRD directive.The information disclosed is based on the results of the double materiality assessment (see pages 35–37) and has been linked to the GRI disclosure requirements, see the GRI Index in the appendix on page 67. Reporting under the EU Taxonomy Regulation (EU 2020/852) is found on page 39. Greenhouse gas emissions have been calculated and is reported in accordance with the Greenhouse Gas (GHG) Protocol (see page 46). HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 DATA & COMPARABILITYSustainability data is collected quarterly from the Group’s subsidiaries. To ensure reliability, reported data points have been compared across subsidiaries and time periods to identify any discrepancies. Estimates may be used to a limited extent for less material data points. Where estimates have been applied more extensively, this is disclosed in the notes to the relevant tables.Certain historical data has been adjusted to improve comparability between financial years and enhance the overall reliability of the reporting. These adjustments are noted under the respective tables. EXTERNAL ASSURANCEThe report is subject to limited assurance by the external audit firm BDO. The purpose of the review is to ensure that the reporting meets high standards of quality and reliability. See the auditor’s statement on the sustainability report on page 70. The Board of Directors reviews and provides input on the sustainability report and its contents prior to final approval and signing. ABOUT THE SUSTAINABILITY REPORTGeneral informationEnvironmental Social Appendix 30 Auditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 31
SUSTAINABILITY GOVERNANCEPOLICIES, TARGETS & STANDARDSPOLICY COMMITMENTSHumble’s policies and internal guidelines constitute a central part of our corporate governance. Read more about our governance in the Corporate Governance Report on pages 19–27. Sustainability-related policies•The Humble Way (Our Code of Ethics)•Speak Up (Whistleblowing Policy)•Human Resource Policy•Anti-Bribery & Corruption Prevention Policy•Human Rights Policy•Supplier Code of Conduct•Environmental Policy•Information Security and Data Protection Policy•Double Materiality Assessment ProcedureSUSTAINABILITY TARGETSIn 2024, the Board adopted Group-wide sustainability targets. Read more in the Business Overview on page 13.GUIDING PRINCIPLESHumble is a member of the UN Global Compact (UNGC) and adheres to its Ten Principles for responsible business conduct. Our sustainability policies are based on internationally accepted standards for human rights, labor conditions, environment, and anti-corruption, such as the OECD Guidelines for Multinational Enterprises, the UN Guiding Principles on Business and Human Rights, and the ILO Core Conventions.PRODUCTION STANDARDS & CERTIFICATIONSOut of our 17 production facilities, 16 hold quality certifications, ensuring safe and healthy products of high quality. The one facility that lacked a certification in 2024 was newly established during the year and is expected to be certified in the first half of 2025. One of our production sites, Kryddhuset, is also ISO 14001 certified and serves as a leading example for other production companies within the Group in achieving the goal of 100% ISO 14001-certified facilities by 2030. Additionally, two subsidiaries, True Co. and Jalofoods, are B Corp certified. Jalofoods received its B Corp certification in April 2024. GOVERNANCE MODELHumble’s Board of Directors holds overall responsibility for the Group’s sustainability strategy, targets, and performance follow-up. The Board annually reviews and approves sustainability-related policies and oversees the implementation and outcomes of the strategy. Group Management is responsible for the operational execution of the Board’s directives and for continuously reporting on the progress of sustainability efforts.The composition and responsibilities of the Board and Management are described in the Corporate Governance Report on pages 22–23.. Humble’s sustainability team and operations team play a central role in embedding the sustainability strategy across the Group. The sustainability team leads the coordination and development of Group-wide policies, processes, and initiatives, including sustainability reporting. The operations team supports and monitors implementation within the daily activities of the subsidiaries. Each subsidiary CEO is responsible for ensuring that the Group’s sustainability policies and targets are implemented in their respective operations. They are also responsible for ensuring that all employees are aware of and trained in the Group’s policies and that they contribute to achieving the Group-wide sustainability targets. Each CEO may appoint a sustainability champion to support the implementation of sustainability initiatives and to oversee reporting to the parent company. Board of Directors of Humble Group ABExecutive Management TeamSustainability TeamOperations TeamSubsidiary CEOsSustainability ChampionsSustainability policies and targets %NUMBER%NUMBERProduction standards 2023-12-312024-12-3188%1494%16Quality certified1production sites6%16%1ISO14001-certifierade production sites¹ Includes GFSI standards, ISO9001, ISO22000, ISO13485 and ISO22716.HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 202431 General informationEnvironmental Social AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 32
Humble continuously adapts and advances its sustainability work to better meet stakeholder expectations and requirements. In 2024, we strengthened our strategy by introducing several measurable targets and enhancing transparency through the public disclosure of additional data points in this sustainability report. These efforts support the development of long-term stakeholder relationships and help foster trust.The Board of Directors is informed monthly of relevant matters arising from stakeholder dialogues, ensuring that stakeholder perspectives are considered in strategic decision-making.. STAKEHOLDER ENGAGEMENT HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 32 STAKEHOLDERS & THEIR VIEWSEngaging our stakeholders is a central part of how we develop and implement our sustainability strategy. Through ongoing dialogue with employees, customers, consumers, suppliers, investors and shareholders, and other key stakeholders, we ensure that our sustainability efforts remain relevant and aligned with their needs and expectations.The purpose of these stakeholder dialogues is to identify material sustainability issues, ensure appropriate strategic focus, and strengthen our ability to manage risks, foster trust, create value, and drive innovation. Stakeholder perspectives have played a key role in informing our double materiality assessment process (see page 35). General informationEnvironmental Social AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT HOW WE ENGAGEHOW WE CREATE VALUESTAKEHOLDER GROUPPersonal meetings, open feedback, development reviews, employee surveys, trainings, intranet and other communication channels, whistleblowing channel, trade union organizationsA safe and inclusive work environment, health and well-being, opportunities for development, fair wages, employee benefitsEmployeesPersonal meetings, customer conferences, trade fairs, industry initiatives, questionnaires and audits, and the customer’s own code of conductThrough products and initiatives that align with their sustainability strategyCustomersWebsites, social media, consumer surveys, marketing campaigns, product packagingHealthy and sustainable products, accurate product informationConsumersStrategic planning and follow-up meetings, formal audits, questionnaires, Supplier Code of ConductClear expectations regarding sustainability requirementsSuppliersAnnual General Meeting, annual report, financial statements, quarterly earnings presentations, capital markets day, individual investor meetings, surveys, and rankingsThrough credible and value-creating sustainability efforts that align with their investment strategiesInvestors and shareholdersOngoing dialogues, application and permitting processes, regulatory audits, charitable initiatives (financial and product donations, volunteer days)Through responsible business practices that comply with applicable laws and regulations and consider the impact on people and the environmentAuthorities, NGOs, trade unions, local communities
Page 33
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 Healthy people on a healthy planetLead cross-sectoral collaborationsSafe & fair value chainsHealthy products made accessible to all•Embrace cross-sector collaborations•Be a trusted partner with high ethical standards•Reinvest in our communities to drive positive societal impact•Advocate for necessary policy and legislative changes•Ensure attractive and rewarding workplaces with high competence and diversity •Respect and protect human rights•Support the transition to renewable energy and fossil-free transportation•Minimize greenhouse gas emissions in production and supply chains•Implement sourcing practices that protect biodiversity and ecosystems•Ensure transparent and traceable product origins•Promote zero-waste and circular solutions •Offer holistic product solutions that support physical and mental well-being•Provide safe and healthy products for people and the planet•Increase access to better choices for consumers of all ages•Collaborate with third-party certifications•Committing to honest & transparent marketing practices INNOVATION FOR POSITIVE IMPACTCOLLABORATION FOR BUSINESS EXCELLENCESECURING RESPONSIBLE VALUE CHAINSEMPOWERING BETTER CHOICES•Drive change within the FMCG sector•Promote innovation to accelerate transformation•Foster an entrepreneurial mindset•Apply science-based approaches•Build an innovation hub for healthy lifestyles•Add acquisitions aligned with the sustainability strategy Healthy people on a healthy planet – this is our vision for the future.Our strategic framework outlines what it means to operate as a sustainable FMCG company. It defines four key areas where Humble can make the greatest impact and serves as the foundation setting priorities and drive change. These priorities guide both the decisions we make today and the strategic direction we pursue going forward.Our strategy has been shaped through internal dialogue and engagement with stakeholders to define what we aim to achieve. We remain humble in recognizing that driving meaningful change across all areas takes time -and that the journey toward realizing our vision has only just begun. ACTIVATIONS AMBITIONIMPACTAREA SUSTAINABILITY STRATEGYHEALTHY PEOPLE ON A HEALTHY PLANET 33 General informationEnvironmental Social AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 34
34 OWN OPERATIONSProduction Product development & R&D Warehousing & distribution Marketing & sales Support services & administration UPSTREAM (SUPPLIERS)Procurement of raw material and packaging material Procurement of finished goods Procurement of supporting goods & services Incoming transports DOWNSTREAM (CUSTOMERS)Outgoing transports Distribution Consumption & product use End-of-life handling / waste BUSINESS MODEL & VALUE CHAINOUR BUSINESS MODELHumble operates in the FMCG sector (fast-moving consumer goods) and comprises a group of rapidly growing, entrepreneur-driven companies focused on innovative, healthier, and more sustainable consumer products.Learn more about our business model, product segments, and geographic presence in the Business Overview on pages 3–18. Employee distribution by country is presented on page 57.The subsidiaries are categorized into three main groups: producers, who operate manufacturing facilities and develop products; brands, who design, develop, and market products; and distributors, who manage warehousing, sales, and distribution to end customers.OUR VALUE CHAINUPSTREAM ACTIVITIESDepending on the specific profile of each subsidiary, various procurement activities are conducted at the early stages of the value chain. Producers source raw materials and packaging to enable product manufacturing and packing, while brands and distributors purchase finished goods from both internal and external producers. Several subsidiaries also act as internal suppliers within the Group, fostering synergies and improving operational efficiency. In addition, they procure goods and services that support their operations, such as machinery, office supplies, logistics, and administrative services.OWN OPERATIONSIn addition to the activities of individual subsidiaries, Group-level activities are carried out. This includes shared support services and administrative functions such as finance and accounting, business development, sustainability, IT and analytics.DOWNSTREAM ACTIVITIESThese activities primarily consist of outbound transportation and distribution to customers. Deliveries are typically made to central warehouses or directly to retail stores. However, our responsibility extends beyond delivery: we also consider the product’s impact on consumers further downstream and how it is managed at the end of its life cycle.HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 202434 General informationEnvironmental Social AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 35
DOUBLE MATERIALITY ASSESSMENTPROCESS FOR DETERMINING MATERIAL TOPICSAs part of our preparations for the EU Corporate Sustainability Reporting Directive (CSRD), Humble has established a formal process for identifying and assessing material sustainability topics using a double materiality perspective. This process, formalized in 2024, outlines the Group’s approach to determining the most relevant sustainability topics.To ensure the process remains relevant and responsive to changing circumstances, all steps are carried out and documented on an annual basis. The overall methodology is reviewed with the same frequency and updated in line with emerging best practices.The double materiality perspective involves evaluating sustainability topics based both on their impact on people and the environment, and on the financial risks and opportunities they may pose for the Group. The assessment is based on our value chain, where impacts, risks, and opportunities are identified and analyzed from two directions: an inside-out perspective, which focuses on the Humble’s impact on people and the environment, and an outside-in perspective, which considers how external sustainability factors may give rise to financial risks or opportunities for the Group.The assessment applies three different time horizons, aligned with internal decision-making, business planning, and risk management processes:1. Short term: <1 year2. Medium term: 1–3 years3. Long term: >3 years The outcome of the process establishes Humble’s material topics, which form the foundation of our sustainability strategy and guide the data points disclosed in the annual sustainability report.STEP 1: UNDERSTANDING In the first step, activities across each stage of the Group’s value chain are mapped:•Upstream: Purchased goods, services, and transportation•Own operations: Production, distribution, sales, and support functions•Downstream: Waste, transportation, consumption, and product useFor each activity, key stakeholders are also identified, divided into the categories of affected stakeholders and users of the sustainability report.STEP 2: IDENTIFICATION In the second step, the impacts, risks, and opportunities (IROs) associated with the value chain activities are identified and described. The time horizon for each IRO is also defined.•Impacts are described and classified as either positive or negative, as well as whether they are actual and already realized, or potential. They are also assessed based on whether they involve negative impacts on human rights.•Risks and opportunities are described and categorized as either risks, in the form of negative financial effects, or opportunities, in the form of positive financial effects. These are further classified according to the type of financial impact, including financial position, financial performance, cash flow, and access to finance or cost of capital. HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 1. UNDERSTANDING•Market, industry, business model, strategy•Value chain analysis•Stakeholder analysis2. IDENTIFICATION•Impacts on people and the environment•Financial risks & opportunities3. ASSESSMENT•Application of quantitative method•Impact analysis•Financial analysis4. DETERMINATION•Materiality threshold•Approval of material topicsDMA PROCESSRESULT•Identification of data points & disclosures•Gap analysis against existing reportingIMPLEMENTATION•Implementation in strategy & targets•Data collection & KPI follow-upDISCLOSURE•Publication of annual sustainability report in accordance with disclosure requirementsREPORTING35 General informationEnvironmental Social AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 36
STEP 3: ASSESSMENT OF IMPACTS, RISKS & OPPORTUNITIESOnce the IROs have been identified, they are assessed using a quantitative methodology that applies two distinct approaches:Impact assessment•For actual negative impact: assessment is based on severity, where severity is determined by scale, scope, and irremediability.•For potential negative impact: severity and likelihood are weighted equally - except in cases involving negative impacts on human rights, where severity takes precedence over likelihood.•For actual positive impact: scale and scope are weighted equally.•For potential positive impact: scale, scope, and likelihood are weighted equally.Financial assessmentThe materiality of risks and opportunities is assessed based on the potential size and likelihood of the financial effects, which are weighted equally in the quantitative methodology. HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 The results from each methodology are quantified on a scoring scale from 1 to 5, where 5 indicates the highest level of materiality. Once the assessment is completed, validation is conducted with relevant external stakeholders through, for example, questionnaires or interviews.STEP 4: DETERMINATION OF MATERIAL TOPICSIn the final step, a materiality threshold is defined to determine which sustainability topics qualify as material. This threshold is based on the assessment results, and topics scoring above the threshold are considered material.The outcome of this process is presented as a list of material sustainability topics for the upcoming financial year. The result must be approved by Humble’s Group Management and Audit Committee before being formally adopted by the Board of Directors.Double Materiality Assessment: Quantitative MethodologySCORINGDESCRIPTIONFACTORAREA1 - Minimum impact2 - Low impact3 - Medium impact4 - Medium-high impact5 - High impactHow grave or beneficial the negative or positive impact is for people and the environmentScaleSeverityImpact analysis1 - Minimum reach2 - Limited reach3 - Medium reach4 - Widespread reach5 - Global reachHow widespread the negative or positive impacts are, such as the scale of environmental damage, the size of the geographic area affected, or the number of people impactedScope1 - Easily remediable2 - Remediable3 - Difficult to remediate4 - Very difficult to remediate5 - Non-remediableFor negative impacts, whether and to what extent the effects can be remediatedIrremediability(if negative)1 - Unlikely: <5%2 - Not very likely: 6-20%3 - Rather likely: 21-50%4 - Likely: 51-90%5 - Almost certain: >90%For potential impacts (both positive and negative), likelihood is assessed on a scale from 0–100% over the defined time horizonLikelihood(if potential)1 - Limited: <5% reduction2 - Low: 5-10% reduction3 - Moderate: 10-15% reduction4 - High: 5-20% reduction5 - Significant: >20% reductionThe potential size of the financial effect on operating profitSizeFinancial analysis1 - Unlikely: <5%2 - Not very likely: 6-20%3 - Rather likely: 21-50%4 - Likely: 51-90%5 - Almost certain: >90%The likelihood of the financial effect occurring, expressed as a percentage between 0–100% over the defined time horizonLikelihood36 General informationEnvironmental Social AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 37
RESULT OF THE MATERIALITY ASSESSMENTThe results of the materiality assessment are presented for the first time for the 2024 financial year and are the outcome of a process initiated in 2023 and concluded in 2024. The following sustainability topics have been determined as material to the Group:•Climate change•Water resources•Circular economy•Own workforce•Workers in the value chain HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 Double Materiality Assessment: Result 2024FINANCIAL RISKS & OPPORTUNITIESIMPACTS ON PEOPLE & ENVIRONMENTMATERIAL TOPICClimate change entails financial risks due to physical risks to facilities and the supply chain, as well as rising costs related to energy use and regulatory compliance.Humble has an actual negative impact on climate change through greenhouse gas emissions and energy use across the value chain.Climate changePage 42Increased competition for water resources entails financial risks through higher costs for water, raw materials, and regulatory compliance.Humble has an actual negative impact on water resources through the water usage associated with its products, primarily in the early stages of the value chain.Water resourcesPage 47A circular economy presents both financial risks and opportunities. Risks include increased costs for waste management and regulatory compliance, as well as market risks. Opportunities lie in cost savings from improved resource efficiency and new revenue streams from circular products.Humble has both actual and potential negative impacts on the circular economy. Actual impacts arise from waste generated throughout the value chain, while potential impacts stem from the use of virgin, non-renewable materials and packaging designs that do not support recycling processes.Circular economyPage 49The own workforce presents both financial risks and opportunities. Potential risks include costs resulting from high employee turnover, absenteeism, and reputational damage. Opportunities include the ability to attract and retain talent, cost savings from low turnover, a stronger market position, and enhanced reputation.Humble has a potential positive impact on its own workforce by upholding labor rights and market-level wages, promoting gender equality and diversity, and supporting human rights in line with international principles.Own workforcePage 55Working conditions in the value chain pose both financial risks and opportunities for Humble. Risks include potential reputational damage, legal disputes, and increased costs in the event of labor-related controversies, while improved human rights and labor standards can enhance reputation and reduce the cost of capital.Humble has a potential negative impact on workers in the value chain due to the presence of low-wage labor in the supply chain, which may pose risks related to inadequate labor rights and elevated risks of child labor in certain international supplier tiers and regions. Workers in the value chainPage 63 In the table below, Humble’s material sustainability topics are presented based on their overall impact on people and the environment, as well as financial risks and opportunities. A more detailed description of the impacts, risks and opportunities, along with the strategy for managing each material topic, is provided later in this report - see the page references in the table.MATERIAL TOPICS 37 General informationEnvironmental Social AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 38
AFFÄRSÖVERSIKT BOLAGSSTYRNING HÅLLBARHET ÅRSREDOVISNING HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 ENVIRONMENTAL INFORMATION 38 BUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 39
EU TAXONOMY REPORT HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 BACKGROUND TO THE EU TAXONOMYThe EU Taxonomy Regulation is part of the EU’s strategy for sustainable growth and serves as a unified classification system for identifying and promoting environmentally sustainable economic activities.The EU taxonomy covers six environmental objectives:1. Climate change mitigation2. Climate change adaptation 3. Sustainable use and protection of water and marine resources 4. Transition to a circular economy5. Pollution prevention and control6. Protection and restoration of biodiversity and ecosystemsREPORTING PRINCIPLESHumble’s Annual Report for 2024 has been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) and adopted by the EU. The basis of preparation is described in Note 2 Group accounting principles in the financial statements. Revenue, capital expenditures, and operating expenditures are defined in accordance with Article 8 of the Taxonomy Regulation, as described below:•Turnover: Total turnover corresponds to the net revenue reported in the Group’s consolidated income statement.•CapEx: Total CapEx correspond to purchases and acquisitions of subsidiaries related to balance sheet items for property, plant and equipment, intangible assets, and newly added or renegotiated right-of-use assets, as presented in the financial statements included in the annual report.•OpEx: Total OpEx correspond to non-capitalized costs for research and development, building renovations, short-term leases, maintenance and repair costs, as well as other indirect costs related to the day-to-day operation of tangible assets. CHANGES IN REPORTING COMPARED TO THE PREVIOUS REPORTING PERIODIn the 2023 sustainability report, the activity Data-driven solutions for the reduction of greenhouse gas emissions was reported as taxonomy-eligible. This activity has been re-evaluated in the 2024 assessment and is no longer considered taxonomy-eligible. Historical data has been adjusted accordingly. ASSESSMENT OF TAXONOMY ELIGIBILITYHumble’s assessment of taxonomy-eligible economic activities encompasses all activities conducted across the Group. The assessment is based on a Group-level internal analysis in which all potentially relevant activities listed in the Delegated Acts are reviewed, and non-relevant activities are excluded. The relevant activities were then verified in collaboration with the operations and financial teams, followed by data collection from the subsidiaries.The assessment resulted in the identification of the following taxonomy-eligible activities for 2024:•Transport by motorcycles, passenger cars and light commercial vehicles (CCM 6.5): Includes leasing costs for passenger cars used within the Group.•Freight transport services by road (CCM 6.6): Includes freight costs related to the transport of goods using owned or leased trucks.•Installation, maintenance and repair of energy efficient equipment (CCM 7.3): Includes costs associated with the installation of heat pumps and LED lighting in 2024.•Acquisition and ownership of buildings (CCM 7.7): Includes costs related to building renovations and the leasing of new facilities.ASSESSMENT OF TAXONOMY ALIGNMENTFor an economic activity to be considered taxonomy-aligned, it must meet three criteria: it must (1) substantially contribute to one or more of the EU’s environmental objectives, (2) do no significant harm (DNSH) to any of the remaining objectives, and (3) comply with the minimum social safeguards, which cover human rights, tax compliance, fair competition, and anti-corruption.Due to existing uncertainties regarding the interpretation of the minimum safeguards and the conditions under which compliance can be considered fulfilled, Humble has chosen not to report any activities as taxonomy-aligned for the 2024 reporting year. Efforts to centralize due diligence processes across the supply chain and to further strengthen the Group’s work within the four minimum safeguard areas will continue in 2025. Humble has not been involved in any incidents in 2024 related to human rights, tax compliance, anti-competitive behavior, or corruption.39 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 40
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 NUCLEAR & FOSSIL GAS RELATED ACTIVITIES KEY FIGURESTURNOVER, CAPEX & OPEXDo No Significant Harm (DNSH)Substantial Contribution Criteria2024TURNOVER Category transitional activityCategory enabling activityProportion of taxonomy-aligned (A.1) or eligible (A.2) turnover2023Minimum safeguardsBiodiversityCircular economyPollutionWaterClimate change adaptationClimate change mitigationBiodiversityCircular economyPollutionWaterClimate change adaptationClimate change mitigationProportion of turnover TurnoverCode 1)Economic activitiesTE%Yes / NoYes (Y) / No (N)/ Non-eligible (N/EL)%MSEKA. TAXONOMY-ELIGIBLE ACTIVITIESA.1 Environmentally sustainable activities (Taxonomy-aligned)0%-------0%0%0%0%0%0%0%0.0Turnover of environmentally sustainable activities (Taxonomy- aligned) (A.1)E0%-------0%0%0%0%0%0%0%0.0Of which EnablingT0%-------0%0%0.0Of which TransitionalObjectives for which activity is eligibleA.2 Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned)0%N/ELN/ELN/ELN/ELELEL0%0.0CCM 6.5Transport by motorcycles, passenger cars and light commercial vehicles0%N/ELN/ELN/ELN/ELELEL0%0.0CCM 6.6Freight transport services by road0%N/ELN/ELN/ELN/ELELEL0%0.0CCM 7.3Installation, maintenance and repair of energy efficient equipment 0%N/ELN/ELN/ELN/ELELEL0%0.0CCM 7.7Acquisition and ownership of buildings 0%0%0.0Turnover of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) 0%0%0.0A. Turnover of Taxonomy-eligible activities (A.1 + A.2)B. TAXONOMY-NON-ELIGIBLE ACTIVITIES1)CCM: Climate change mitigation2)The total turnover corresponds to the net sales in the Consolidated statement of comprehensive income in the Annual report100%7,708Turnover of Taxonomy-non-eligible activities100%7,708TOTAL2) YES/NONuclear energy related activitiesNOThe undertaking carries out, funds or has exposures to research, development, demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the fuel cycle.NOThe undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations toproduce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogenproduction, as well as their safety upgrades, using best available technologies.NOThe undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce electricityor process heat, including for the purposes of district heating or industrial processes such as hydrogen production from nuclear energy, as well as their safety upgradesYES/NOFossil gas related activitiesNOThe undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities that produce electricity using fossil gaseous fuels.NOThe undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/cool and power generation facilities using fossil gaseous fuels.NOThe undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation facilities that produce heat/cool using fossil gaseous fuels. 40 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 41
Do No Significant Harm (DNSH)Substantial Contribution Criteria2024OPEX Category transitional activityCategory enabling activityProportion of taxonomy-aligned (A.1) or eligible (A.2) OpEx2023Minimum safeguardsBiodiversityCircular economyPollutionWaterClimate change adaptationClimate change mitigationBiodiversityCircular economyPollutionWaterClimate change adaptationClimate change mitigationProportion of OpExOpExCode 1)Economic activitiesTE%Yes / NoYes (Y) / No (N)/ Non-eligible (N/EL)%MSEKA. TAXONOMY-ELIGIBLE ACTIVITIESA.1 Environmentally sustainable activities (Taxonomy-aligned)0%-------0%0%0%0%0%0%0%0.0OpEx of environmentally sustainable activities (Taxonomy-aligned) (A.1)E0%-------0%0%0%0%0%0%0%0.0Of which EnablingT0%-------0%0%0.0Of which TransitionalObjectives for which activity is eligibleA.2 Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned)16%N/ELN/ELN/ELN/ELELEL9%3.0CCM 6.5Transport by motorbikes, passenger cars and light commercial vehicles0%N/ELN/ELN/ELN/ELELEL0%0.0CCM 6.6Freight transport services by road0%N/ELN/ELN/ELN/ELELEL0%0.0CCM 7.3Installation, maintenance and repair of energy efficient equipment 19%N/ELN/ELN/ELN/ELELEL22%7.2CCM 7.7Acquisition and ownership of buildings 35%32%10.1OpEx of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) 35%32%10.1A. OpEx of Taxonomy-eligible activities (A.1 + A.2)B. TAXONOMY-NON-ELIGIBLE ACTIVITIES1)CCM: Climate change mitigation68%21.9OpEx of Taxonomy-non-eligible activities100%32.0TOTAL Do No Significant Harm (DNSH)Substantial Contribution Criteria2024CAPEX Category transitional activityCategory enabling activityProportion of taxonomy-aligned (A.1) or eligible (A.2) CapEx2023Minimum safeguardsBiodiversityCircular economyPollutionWaterClimate change adaptationClimate change mitigationBiodiversityCircular economyPollutionWaterClimate change adaptationClimate change mitigationProportion of CapExCapExCode 1)Economic activitiesTE%Yes / NoYes (Y) / No (N)/ Non-eligible (N/EL)%MSEKA. TAXONOMY-ELIGIBLE ACTIVITIESA.1 Environmentally sustainable activities (Taxonomy-aligned)0%-------0%0%0%0%0%0%0%0.0CapEx of environmentally sustainable activities (Taxonomy-aligned) (A.1)E0%-------0%0%0%0%0%0%0%0.0Of which EnablingT0%-------0%0%0.0Of which TransitionalObjectives for which activity is eligibleA.2 Taxonomy-Eligible but not environmentally sustainable activities (not Taxonomy-aligned)3%N/ELN/ELN/ELN/ELELEL3%12.0CCM 6.5Transport by motorcycles, passenger cars and light commercial vehicles0%N/ELN/ELN/ELN/ELELEL0%0.5CCM 6.6Freight transport services by road0%N/ELN/ELN/ELN/ELELEL0%0.7CCM 7.3Installation, maintenance and repair of energy efficient equipment 34%N/ELN/ELN/ELN/ELELEL37%136.0CCM 7.7Acquisition and ownership of buildings 37%40%149.2CapEx of Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities) (A.2) 37%40%149.2A. CapEx of Taxonomy-eligible activities (A.1 + A.2)B. TAXONOMY-NON-ELIGIBLE ACTIVITIES1)CCM: Climate change mitigation2)See Note 14 Intangible assets, 15 Tangible fixed assetsand 16 Lease agreements in the Annualreport for total CapEx60%220.8CapEx of Taxonomy-non-eligible activities100%370.0TOTAL2) HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 202441 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 42
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 CLIMATE-RELATED IMPACTClimate change is one of the most pressing global challenges of our time, with far-reaching consequences for both people and the environment. It affects ecosystems, societal structures, and economies across the world. For Humble, addressing climate change is not only a moral obligation but also a strategic business imperative. Our operations contribute to greenhouse gas emissions, and we recognize our responsibility to reduce our climate footprint. Climate change presents significant financial risks to our business, but it also brings opportunities for innovation, market expansion, and business development.By proactively addressing climate-related issues, we aim to minimize negative impacts on people and the planet, while strengthening our competitiveness and long-term profitability. IMPACT ON PEOPLE & THE ENVIRONMENTHumble’s operations result in actual negative climate impact through greenhouse gas emissions and energy use across the value chain. This includes:•Greenhouse gas emissions and energy use upstream the value chain, from suppliers of input goods, transportation, and services, including upstream transport of goods and raw material extraction.•Greenhouse gas emissions and energy use in our own operations, in production and distribution processes linked to core operations, including heating, cooling, electricity supply to facilities, and transport with company-owned vehicles.•Greenhouse gas emissions and energy use downstream in the value chain, including waste treatment through incineration and recycling, transport of sold goods, and end-of-life disposal of products. Solar panels on Natumin Pharma’s factory in Habo, Västergötland. CLIMATE CHANGE 42 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 43
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 CLIMATE-RELATED RISKS & OPPORTUNITIESHumble’s climate scenario analysis is based on the recommendations of the TCFD (Task Force on Climate-related Financial Disclosures) and aims to assess climate-related risks and opportunities for the business in the short (0–5 years), medium (5–10 years), and long term (10–30 years). By analyzing two key scenarios – one in which global warming is limited to 1.5°C and another with warming of 3–4°C – we gain a better understanding of how climate change may impact our operations and supply chain.SCENARIO 2: GLOBAL WARMING OF 3-4°CIf the world fails to limit global warming to 1.5°C, physical risks will dominate, with significant consequences for our operations:•Extreme weather events and water stress.Our production facilities in Portugal and Australia are particularly vulnerable to drought and wildfires, which could lead to production disruptions and increased costs to ensure operational continuity. Transportation and logistics flows may also be impacted by extreme weather conditions.•Disruptions in raw material supply and price increases,Agricultural commodities such as cocoa, palm oil, and nuts are highly sensitive to climate change. Disruptions in the production of these raw materials - especially from high-risk countries like Indonesia and Peru - could result in shortages and price increases, negatively affecting our operations.•Financial effect.Rising costs for raw materials and transportation may place pressure on the Group’s margins. This will require careful planning and operational measures to secure raw material supply and maintain profitability.Asset exposure and sensitivity: Our supply chain - particularly for raw materials sourced from high-risk countries - is susceptible to climate-related disruptions. Securing access to these critical inputs is essential for long-term stability and profitability. SCENARIO 1: GLOBAL WARMING OF 1.5°CIn this scenario, the goals of the Paris Agreement are achieved, leading to transition risks resulting from stricter regulations and technological shifts:•Stricter regulations.In the short term, carbon pricing and energy requirements may result in increased production and transportation costs, particularly at our facilities within the EU. Investments in energy efficiency and renewable energy - such as solar panels and energy-efficient machinery - are essential to manage these costs. •Technological transition and innovation.In the medium to long term, technological advancements and adaptations to our production processes will be required to meet both market and regulatory demands. Our business model, which is built on flexibility and innovation, enables us to develop climate-friendly products and enhance our competitiveness in a market with growing sustainability expectations.•Changing customer preferences. Demand for sustainable products is increasing, offering us an opportunity to adjust and expand our product portfolio. By aligning with consumer expectations, we can strengthen our market position.Asset exposure and sensitivity: The Group’s facilities in Portugal and Australia are located in regions with high water stress, which may affect operations through drought and water scarcity. Addressing these risks through water efficiency measures will be critical to ensuring the stability of these sites.Production av gums at True Co. in Glostrup, Denmark 43 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 44
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 POLICIES, ACTIONS & TARGETSCLIMATE-RELATED POLICIESHumble’s Environmental Policy outlines our commitment to reducing negative impacts on climate change. The policy states that we will:•Aim to achieve carbon-positive production and supply chains.•Support the transition to renewable energy and fossil-free transportation.•Promote a circular economy and reduce greenhouse gas emissions by eliminating waste and increasing the use of recycled and recyclable materials.Humble’s Supplier Code of Conduct establishes similar expectations for our suppliers: •Actively work to reduce greenhouse gas emissions through energy-efficient processes and renewable energy.•Promote sustainable production methods that conserve natural resources and minimize environmental impact.•Select materials with low environmental impact that contribute to a circular economy.CLIMATE-RELATED TARGETSIn 2024, Humble’s Board of Directors established the following targets to mitigate climate change:•100% renewable electricity and heating by 2030.At the same time, we will continue to measure and monitor emissions across Scope 1, 2, and 3, with the ambition to set science-based climate targets in alignment with the Science Based Targets initiative (SBTi).Read more about the Group’s sustainability goals in the Business Overview on page 13. CLIMATE-RELATED ACTIONSIn 2024, Humble implemented several measures to reduce climate impact, improve energy efficiency, and transition to renewable energy sources:•Solar panels were installed at Kryddhuset’s production facility in Ljung to secure the use of renewable energy. A decision has also been made to install solar panels at Lev Group’s factory in Aveiro, Portugal, with installation expected in 2025.•Continued production of biogas from food waste at Jalofoods’ own biogas facility.•Privab introduced a new logistics solution through the engagement of a new freight forwarder, whereby goods are delivered to terminals for consolidation with shipments from other companies. This improves truck load efficiency and contributes to more climate-efficient transportation.•Jalofoods climate compensated 800 metric tons of CO₂-equivalents through verified carbon credits.•LED lighting was installed in several warehouse and production facilities, including Grahns Konfektyr and Privab Trollhättan, covering a combined area of nearly 15,000 square meters.•Energy-efficient heating systems (heat pumps) were installed at Privab, Privab Trollhättan, and Vitalkost.•Additional measures include the switch to certified renewable electricity, installation of EV charging stations, transition to electric and hybrid company vehicles, and energy-saving initiatives such as motion-activated lighting and timers for computers and air conditioning systems. 44 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 45
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 ¹ Historical data has been adjusted to include all of Humble’s subsidiaries and operations. In 2023, energy consumption was reported only for companies covered by the Group’s framework agreement with Fortum.2 Operations in sectors with high climate impact are defined as producing subsidiaries under NACE C (Manufacturing). 2022¹2023¹ 2024Energy consumption and mix (MWh)22,05626,14425,302Total energy consumption7,7098,4885,887Total fossil fuel energy consumption000Fuel consumption from coal and coal products2,6733,5954,160Fuel consumption from crude oil and petroleum products89200322Fuel consumption from natural gas0090Fuel consumption from other fossil sources4,9474,6931,316Consumption of electricity, heat, and cooling from fossil sources35%32%23%Share of fossil sources in total energy consumption (%)--444Total energy consumption from nuclear sources--2%Share of consumption from nuclear sources in total energy consumption (%)14,34717,65618,970Total energy consumption from renewable sources6491,5921,597Fuel consumption from renewable sources13,69816,06416,712Consumption of electricity, heat, and cooling from renewable sources--661Consumption of self-generated non-fuel renewable energy65%68%75%Share of renewable sources in total energy consumption (%)--790Total energy production--90Non-renewable energy production--700Renewable energy production--161Energy intensity per net revenue from activities in high climate impact sectors2(MWh/MEUR) ENERGY CONSUMPTION & MIXSince 2022, Humble has been working to transition to renewable energy sources across the Group, with the goal of reducing greenhouse gas emissions and strengthening the energy resilience of our operations. Several subsidiaries have taken concrete steps toward renewable energy. Vitalkost, Natumin Pharma, Jalofoods, and Kryddhuset produce renewable energy at their facilities, contributing to increased use of renewables while helping to stabilize operational costs. A framework agreement for renewable energy has also been established, which all Swedish entities within the Group are invited to join. In pursuit of our goal to achieve 100% renewable electricity and heating by 2030, we are committed to driving additional Group-wide initiatives to enable a full transition to renewable energy. In 2024, the Group’s total energy consumption amounted to 25,302 megawatt-hours (MWh). The producing subsidiaries accounted for over 90% of total energy use. The share of energy from renewable sources reached 75%, representing a 7% increase compared to 2023. 45 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT 75%23%2%ENERGY MIX Förnybara källor Fossila källor KärnenergikällorRenewablesFossil fuelNuclear energy
Page 46
EMISSIONS IN SCOPE 3Scope 3 includes indirect emissions that occur throughout the value chain outside of Humble’s own operations. Humble reports upstream Scope 3 emissions, covering emissions from the supply chain related to raw material extraction, production, and transportation of input goods. This also includes waste generated by our operations and business travel. The calculations do not include downstream value chain activities.Scope 3 emissions increased by 23% between 2023 and 2024, primarily in the category of purchased goods and services, where expenditures have also risen. Increased spending, combined with higher inflation estimates, has resulted in elevated emissions calculations.Most of Scope 3 emissions (99.6%) are estimated based on spend data, in contrast to Scope 1 and 2, which are primarily calculated using activity data (98.3%). The calculations include conservative estimates for food products, which likely leads to an overestimation of emissions. As of 2024, the categories of fuel- and energy-related activities and operational waste are calculated using activity-based data. In 2025, Humble will explore opportunities to collect activity data for additional Scope 3 emission categories. GREENHOUSE GAS EMISSIONSHumble follows the GHG Protocol methodology for calculating and reporting greenhouse gas emissions across Scope 1, 2, and 3. For emission factors and data sources used, see the appendix on page 69. Results for 2022–2024 are presented in the table below.EMISSIONS IN SCOPE 1 & 2Scope 1 and 2 include direct and indirect emissions from energy use. Scope 1 covers emissions from fuel combustion within our own operations, including stationary combustion in boilers, ovens, and machinery, as well as mobile combustion from vehicles owned or leased by Humble. Scope 2 accounts for indirect emissions from purchased electricity, heating, and cooling, where emissions occur at the point of energy generation.Total market-based emissions in Scope 1 and 2 increased by 7.7% between 2023 and 2024. Scope 1 emissions increased by 17%, while Scope 2 emissions increased by less than 0.5%. The rise in Scope 1 emissions is primarily attributed to higher production volumes at our facilities, resulting in increased fuel consumption. HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 2022¹2023¹ 2024GHG emissions (ton CO2e)7931,0281,201Scope 1 GHG emissions178286310Mobile combustion614743892Stationary combustion1,3171,1911,196Scope 2 GHG emissions (market-based)5717651,042Scope 2 GHG emissions (location-based)2,1102,2192,397Total Scope 1 & 2 GHG emissions (market-based)1,3641,7932,244Total Scope 1 & 2 GHG emissions (location-based)168,122203,494250,789Significant Scope 3 GHG emissions (upstream)158,495194,737238,583Purchased goods & services704939847Fuel & energy-related activities8,6237,55910,234Upstream transportation & distribution--105Waste generated in operations3002591,019Business travel170,232205,712252,584Total Scope 1, 2 & 3 GHG emissions (market-based)169,486205,287252,430Total Scope 1, 2 & 3 GHG emissions (location-based)¹ Historical data has been adjusted to improve calculations and include additional operational subsidiaries. 46 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 47
WATER RESOURCES HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 POLICIES, ACTIONS & TARGETS WATER-RELATED POLICIES & TARGETSHumble’s Environmental Policy states our commitment to reducing environmental impact and preserving natural resources, including water. We aim to implement technologies that improve water efficiency, such as systems for water recycling and reuse. We also seek to reduce water use at our facilities. Our Supplier Code of Conduct sets similar expectations for our suppliers.Humble has not yet adopted specific water-related targets; however, the Group’s water consumption is continuously monitored. The Board of Directors has set a target for all production facilities to achieve ISO 14001 certification by 2030, a step expected to enhance water efficiency. One contributing factor to the absence of a specific reduction target is the planned establishment of a new beverage production facility at Natumin Pharma in Habo, Västergötland, during 2024. This facility is expected to significantly increase the Group’s total water consumption in 2025. The site is located in a region with low water stress, according to WRI’s Aqueduct Water Risk Atlas. WATER-RELATED ACTIONSSeveral of Humble’s subsidiaries implemented water reduction measures in 2024, including:•Kryddhuset, which has set a target to reduce water consumption by 10% over five years as part of its ISO 14001 certification. Measures include the installation of new water-efficient nozzles.•Grenna Konfektyr, which has begun weekly monitoring of water use and evaluated the potential for cooling water recovery.•Grahns Konfektyrer, which has installed equipment to reduce water usage in cleaning and dishwashing processes.Our Finnish subsidiary Jalofoods, a producer of plant-based protein products, has also taken action to reduce water pollution:•In 2024, a project was conducted to assess the potential for treating wastewater from solid particles, phosphate, and nitrogen - byproducts from the production of tofu and tempeh. The project resulted in a decision to invest in water treatment technology in 2025, which is expected to reduce water discharge by up to 80%. IMPACT, RISKS & OPPORTUNITIESWater is a critical resource for Humble, both within our own operations and throughout our supply chain. Several raw materials used in our products -such as cocoa, dairy, cotton, nuts, and palm oil -require significant water use, increasing the need for stable water resources across the entire value chain. At the same time, access to and the quality of water resources are increasingly threatened by climate change and growing competition for water in several regions. By identifying risks and impacts related to water use, we take responsibility for minimizing negative effects on local communities and ensuring access to water for our operations.IMPACT ON PEOPLE & THE ENVIRONMENTHumble has an actual negative impact on water resources through:•Water consumption in water-stressed areas.Our production facilities in Australia and Portugal are located in regions with high water stress, where increased water use may contribute to local water shortages. This can affect both communities and ecosystems that depend on the same water sources.•Water use in the supply chain. Raw materials such as cocoa, palm oil, and nuts are often cultivated in water-stressed regions, where water use may reduce availability for local communities and threaten biodiversity.•Risk of water pollution in the supply chain. The production of agricultural commodities can lead to water pollution by pesticides and fertilizers, with potential negative effects on ecosystems and human health.FINANCIAL RISKSGrowing competition for water resources presents financial risks for Humble:•Increased water costs. Higher levels of water stress may drive up water prices, increasing operational costs.•Regulatory risks. Stricter regulations on water use may require investments in new technologies and result in compliance costs that affect profitability.•Supplier risks and raw material prices. Water scarcity can impact the production and pricing of water-intensive raw materials, potentially affecting supply security and cost structures.47 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 48
WATER CONSUMPTIONAcross the Group, water is primarily used at production facilities - both as an ingredient in certain products and in machinery for cooling and heating processes - as well as for cleaning production areas and other facility spaces. Our offices and warehouses also consume water as part of daily operations.In 2024, Humble’s total water consumption amounted to 77,872 cubic meters (m³), with a water intensity of 115.5 m³ per million euros in revenue. No water is currently recycled or stored at any of our sites. HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 2024Water consumption (m3) 77,872Total water consumption16,739Water consumption in areas at water risk, including areas of high-water stress21%Share of total water consumption in areas of high-water stress (%)0Total water recycled and reused0Total water stored0Changes in water storage115.5Water intensity (m3/MEUR net revenue)Operations in areas of water risk, 2024Water stress3Total water risk2LocationSite Extremely high (>80%)High (3-4)Aveiro, PortugalLabóratorio FrancedietHigh (40-80%)Medium-high (2-3)Prestons, NSW, AustraliaBars Production AustraliaHigh (40-80%)Medium-high (2-3)Trofa, PortugalFancyStage Unipessoal Lda1Total water consumption includes estimates, which accounted for 21% of the total.2 Overall water risk is defined as “Overall Water Risk” in the World Resources Institutes (WRI) Aqueduct Water Risk Atlas. 3Areas with high water stress are defined as regions where the percentage of total water withdrawn is high (40–80%) or extremely high (more than 80%), according to WRI’s Aqueduct Water Risk Atlas. WATER RISKThree of our production facilities are exposed to water-related risk due to their location in areas with high water stress. These facilities consumed a total of 16,739 cubic meters of water in 2024, representing 21% of the Group’s total water consumption. Humble continuously monitors and assesses water-related risks. We are also committed to explore opportunities to implement technologies that reduce water consumption, particularly at sites identified as higher risk. 48 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 49
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 IMPACT, RISKS & OPPORTUNITIESThe transition to a circular economy is essential for building a resource-efficient society and for achieving global climate goals. As an actor in the FMCG sector, Humble depends on both raw materials to produce our products and packaging materials to ensure their quality and durability. The large volumes of single-use packaging and non-renewable materials consumed by the industry create a responsibility to manage these resources efficiently and responsibly. By contributing to a circular economy, we can strengthen our own resource efficiency while also unlocking new business opportunities and supporting the transformation of the industry.IMPACT ON PEOPLE & THE ENVIRONMENTHumble has both actual and potential negative impacts on the circular economy. Actual impacts include:•Waste generated throughout the value chain. Waste is generated at all stages, from raw material sourcing and production to internal operations and the consumer phase. Overproduction, food waste, and packaging waste contribute to resource loss.Potential negative impacts include:•Resource-intensive material use. Packaging materials and ingredients in the value chain are partly dependent on non-renewable resources, increasing the need for virgin materials.•Limited recyclability. The design of our packaging affects its recyclability. Limited recycling means certain materials are not effectively recirculated, thereby hindering the transition to a circular economy. FINANCIAL RISKSThe transition to a circular economy may involve the following financial risks:•Raw material costs and material scarcity. Limited availability of renewable and recyclable materials may increase raw material costs, particularly in the context of rising demand and tightening regulations.•Compliance costs. Stricter requirements for waste management and recycling may necessitate investments in new technologies, processes, and materials, leading to higher operational costs.•Market risks. Failure to align with circular principles may negatively affect our competitiveness in a market that increasingly prioritizes sustainable products.FINANCIAL OPPORTUNITIES•Cost savings through resource efficiency. Reducing waste and increasing material reuse can lower raw material and production costs, enhancing both resource efficiency and profitability. •New market opportunities. A product portfolio focused on circular solutions opens access to a growing market of environmentally conscious customers and consumers, creating new sales opportunities and improving customer loyalty. CIRCULAR ECONOMY 49 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 50
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 POLICIES, ACTIONS & TARGETSPOLICIES FOR A CIRCULAR ECONOMYHumble’s Environmental Policy includes several commitments to improving resource efficiency and advancing a circular economy:•Promote resource efficiency to ensure the responsible use of natural resources.•Implement processes and technologies that reduce waste generation and support the recycling and reuse of materials.•Reduce the use of packaging materials by optimizing the weight, volume, and material composition of our packaging.The Supplier Code of Conduct sets similar expectations for suppliers, with a focus on optimized resource use, waste management, and circular packaging solutions.TARGETS FOR A CIRCULAR ECONOMYDuring the year, Humble’s Board of Directors adopted the following target related to resource use and circular economy:•100% recyclable packaging by 2030This target aligns with what’s proposed in the EU Packaging and Packaging Waste Regulation (EU PPWR) and applies to packaging that is under the Group’s control.Read more about the Group’s sustainability targets in the Business Overview on page 13. ACTIONS FOR A CIRCULAR ECONOMYIn 2024, 25 of the reporting subsidiaries implemented measures to improve resource efficiency and support the transition to a circular economy. This area has been a major focus for the Group during the year. Actions taken include:•Reduced material use through elimination and reuse of packaging materials and optimization of raw material sourcing.•Initiatives to prevent waste generation in production processes.•Efforts to improve the recyclability of packaging through design and material changes, such as the removal of black plastics.•Subsidiaries collectively paid over SEK 8 million in packaging fees to Näringslivets Producentansvar(NPA), which funds recycling infrastructure in Sweden.•Initiatives to encourage consumer recycling, including clearer instructions on packaging.•Donation of goods nearing their best-before date - otherwise subject to disposal - to charitable organizations.In 2025, Group-wide measures are planned to further strengthen contributions to a circular economy, with a particular focus on achieving the target of 100% recyclable packaging through design for recycling. 50 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 51
RESOURCE INFLOWSHumble’s resource inflows enable the production, distribution, and refinement of products across our four segments: Future Snacking, Sustainable Care, Quality Nutrition, and Nordic Distribution. The primary resource inflows consist of raw materials for our manufacturing facilities, finished products for our brands and distributors, and packaging materials.RAW MATERIALS & FINISHED PRODUCTSOur procurement includes both raw materials for further processing at production units and externally manufactured finished goods purchased for distribution:•Raw materials and ingredients for production. Our production units procure raw materials used to manufacture finished products in categories such as confectionery, hygiene and household goods, and dietary supplements. This includes sugar, glucose, gelatin, dairy products, cocoa, soy, palm oil, stearin, and other ingredients. Several of the raw materials we source are certified, such as RSPO-certified palm oil, Rainforest Alliance-certified cocoa, and soybeans certified under the EU Organic scheme.•Finished products for distribution. Brands and distribution units purchase ready-made products for resale under both in-house and external brands. The assortment includes snacks and confectionery, beverages, hygiene and household goods, and dietary supplements sold under various brand portfolios. PACKAGING MATERIALSPackaging materials - primarily paper and plastic -constitute an important part of our resource inflows and are used throughout the production and distribution chain. The packaging materials we purchase serve two main purposes:•Consumer packaging. Used by production units to fill and package products intended for end consumers. •Secondary packaging.Used to handle and protect products during transportation and storage. Distributors also use operational packaging when breaking down pallets and repacking into smaller units to meet customer needs.In 2024, the Group’s total packaging material purchases amounted to 101,477 tons, of which 56% was paper and cardboard, 41% plastic, and 3% other materials (primarily glass, metal, and wood). Some of the packaging materials we procure are certified for sustainability, including FSC/PEFC-certified paper and cardboard as well as recycled plastic certified according to mass balance principles.OTHER RESOURCE INFLOWSIn addition to raw materials and packaging, our resource inflows also include machinery, office and factory supplies, and fuels used in production and transportation. We also procure a wide range of services that support our business processes.2024Resource inflows: Packaging materials (ton)44,978Plastics2%Percentage of recycled or bio-based plastics (%)54,315Paper/cardboard11%Percentage of recycled or certified2paper/cardboard (%)600Glass 134Metal 1,438Wood3 12Other packaging materials101,477Total amount of purchased packaging materials55%Percentage of renewable1packaging material (%)6%Percentage of recycled packaging material (%) HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 1 Renewable packaging materials include paper/cardboard, bio-based plastic, and wood.2 Paper/cardboard certified under FSC (Forest Stewardship Council) or PEFC (Programme for the Endorsement of Forest Certification)3 Includes both wood packaging and pallets.51 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 52
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 2024Resource outflows: Product packaging & recyclability (ton)3,684Plastic packaging55%Share of recyclable plastic packaging (%)4,260Paper packaging96%Share of recyclable paper packaging (%)585Metal packaging100%Share of recyclable metal packaging (%)8,529Total weight of product packaging79%Share of recyclable packaging (%) RESOURCE OUTFLOWSCIRCULARITY IN PRODUCTS & PACKAGINGAs an FMCG company, a large share of Humble’s products are designed for consumption. This means they cannot, by nature, be reused, repaired, or remanufactured within a circular economy framework. Therefore, our primary focus is on product packaging and actively ensuring it supports circularity.Our strategy for circular packaging prioritizes design and material choices that enable recyclability, reduce resource consumption, and increasingly incorporate recycled or bio-based materials. We continuously work to optimize weight, volume, and material mix to reduce environmental impact - without compromising product quality or safety .Ensuring that our packaging can be recycled or reused in a resource-efficient manner is a is a key focus area in our sustainability work. We collaborate with suppliers and recycling partners to drive innovation and improve recyclability.PACKAGING RECYCLABILITYThe packaging that our subsidiaries place on the market consists primarily of paper and plastic packaging, with smaller portions made of metal -such as aluminum cans- as well as glass and wood.In 2024, 79% of our packaging was recyclable, compared to our target of 100% recyclable packaging by 2030. Recyclability rates are high for paper and metal, while just over half of plastic packaging is currently recyclable. Plastic is generally more difficult to recycle than paper and metal, due to its varied and complex composition as well as limitations in existing recycling systems.To increase the recyclability rate, we are actively working to optimize our plastic packaging while also contributing to advancements in recycling technology through the packaging fees we pay as part of our extended producer responsibility.55%96%100% Plast Papper Metall 52 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT PlasticPaperMetal
Page 53
58%42% HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 Collection of by-products at Grahns Konfektyr in Skövde for redistribution and reuse as animal feed.2024Waste (ton)895Non-hazardous waste sent to recovery432Reuse437Recycling25Other recovery operations646Non-hazardous waste sent to disposal412Incineration165Landfill70Other disposal operations1,541Total non-hazardous waste22Hazardous waste sent to recovery1Reuse4Recycling17Other recovery operations5Hazardous waste sent to disposal5Incineration0Landfill0Other disposal operations27Total hazardous waste1,568Total waste generated652Non-recycled waste42%Percentage of non-recycled waste (%)58%Percentage of recycled waste (%) Farligt avfall: 2%Ofarligt avfall: 98% WASTEIn 2024, Humble’s operations generated a total of 1,568 tons of waste. The majority of this waste originates from our factories and warehouse operations. Waste volumes by treatment method for 2024 are presented in the table below.NON-HAZARDOUS & HAZARDOUS WASTEHumble’s operations primarily generate non-hazardous waste, which accounts for over 98% of total waste. This includes materials such as paper, cardboard, plastic, glass, metal, and organic waste, including food residues. Only a small portion - less than 2% - is classified as hazardous waste, amounting to 27 tons in 2024. Hazardous waste mainly consists of electronics, batteries, chemicals, lamps, paint, and oil.NON-RECYCLED WASTEOver half of the waste generated within the Group -58% -is recycled through preparation for reuse, material recycling, or other recovery processes. Most of our factories that generate food waste have implemented reuse systems, where waste is collected and sold for use as animal feed or for biogas production. In 2024, 28% of total waste was reused.WASTEComposition & recycling 53 General informationEnvironmentalSocial AppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT Non-hazardous wasteHazardous waste Non-recycled wasteRecycled waste
Page 54
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 SOCIALINFORMATION 54 BUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 55
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 IMPACT, RISKS & OPPORTUNITIESHumble’s workforce is a vital asset and forms the foundation of the Group’s success and continued growth. A safe and fair working environment is essential to maintaining high employee engagement and ensuring long-term access to talent. By upholding robust labor standards and fostering inclusive workplaces, we strengthen both our employees and the organization as a whole.Our operations encompass manufacturing and distribution, where roles may involve physical risks and high workloads. By identifying and addressing risks and opportunities related to working conditions, we actively work to minimize negative impacts and ensure safe, rewarding workplaces.IMPACT ON PEOPLE & THE ENVIRONMENTHumble has a potential positive impact on its workforce by:•Upholding labor rights and fair wages. By complying with the EU Minimum Wage Directive and applying collective agreements across many production and distribution sites, Humble ensures fair wages and working conditions. The Group’s HR Policy outlines the benefits and rights applicable to all employees.•Promoting gender equality, diversity, and inclusion. Our policies reflect a clear commitment to promoting equal opportunities and upholding zero tolerance for discrimination. The company maintains a balanced gender distribution among employees and has set targets to ensure diversity within leadership teams. OWN WORKFORCE•Supporting human rights. As a signatory to the UN Global Compact and through our Human Rights Policy, Humble is committed to supporting decent working conditions and the right to collective bargaining. This commitment ensures that we maintain an ethical and safe working environment across the Group.FINANCIAL RISKS•High employee turnover. Poor working conditions can result in higher staff turnover, leading to increased costs related to reduced productivity, recruitment, and training.•Health and safety risks. Manufacturing and distribution activities carry physical risks for employees, potentially leading to higher rates of absenteeism and associated costs.•Reputational risks.Inadequate attention to equality and inclusion -such as wage discrimination or harassment - can damage the company’s reputation, reduce investor confidence, and impact access to capital by increasing financing costs.FINANCIAL OPPORTUNITIES•Stronger market position and resource optimization. By promoting good working conditions and human rights, Humble can strengthen employee loyalty, attract new talent, and reduce turnover. This lowers recruitment and training costs, improves cash flow, and contributes to long-term stability. 55 General informationEnvironmentalSocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 56
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 •Whistleblower Policy & Speak Up ChannelThe Whistleblower Policy and the Speak Up platform provide employees and external parties with a secure, anonymous channel to report suspected policy violations, including discrimination, harassment, and safety risks. No individual risks retaliation for reporting concerns in good faith. TARGETS FOR THE OWN WORKFORCEIn 2024, Humble adopted two key targets related to our workforce:•Diversity: 60:40 gender quota in management teams•Health & safety: Zero severe workplace accidentsRead more about our sustainability targets in the Business Overview on page 13.ACTIONS FOR THE OWN WORKFORCEHumble has implemented several workforce-related initiatives:•In 2024, 25 subsidiaries reported offering employees various health and wellness benefits, including wellness stipends, private health insurance, and access to gyms, yoga classes, and massage chairs.•As of 2024, employee surveys are conducted at Group level to assess and strengthen employee satisfaction and engagement across the organization.•Humble runs a voluntary mentoring program in which employees are matched with experienced leaders based on their roles and desired areas of development. The program fosters engagement, knowledge sharing, and a sense of community within the organization. POLICIES, ACTIONS & TARGETSPOLICIES FOR THE OWN WORKFORCETo effectively manage identified impacts, risks, and opportunities related to working conditions and labor rights, Humble has implemented a set of core policies that support our commitment to a safe, inclusive, and fair workplace:•The Humble Way (Code of Ethics)Our Code of Ethics guides our values and expectations for integrity and respect in all professional relationships. It sets clear standards for compliance with applicable laws and policies and promotes a safe working environment that fosters engagement and a positive organizational culture.•Human Rights PolicyHumble’s Human Rights Policy is based on the UN Guiding Principles on Business and Human Rights. It promotes equal opportunity and enforces zero tolerance for discrimination and harassment based on age, gender, sexual orientation, disability, ethnicity, religion, or political opinion. We prohibit all forms of forced labor, child labor, and human trafficking. By offering fair wages and benefits in line with market standards and local legislation, and by ensuring a safe working environment, we aim to create inclusive and engaging workplaces.•Human Resource (HR) policyOur HR policy supports a safe working environment through preventive risk management and regular safety training. We actively promote diversity and inclusion, and we offer competitive compensation and benefits that contribute to long-term talent retention and organizational stability. 56 General informationEnvironmentalSocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 57
%Head count%Head count%Head countEmployees by gender 2022-12-312023-12-312024-12-3148%54047%58048%611Female52%58652%64852%651Male 0%01%150%0Other/not disclosed100%1,126100%1,243100%1,262Total employees (head count)%Head countEmployees by country 2024-12-3157%723Sweden14%171UK 5%68Portugal4%50Poland4%50Australia3%43Denmark2%30Norway2%30Germany2%28Finland5%69Other countries¹ 100%1,262Total employees (head count)¹ Primarily Hong Kong, China, France, South Africa and South Korea.HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 57%14%5%4%4%3%2%2%2%5%SwedenUKPortugalPolandAustraliaDenmarkNorwayGermanyFinlandOther countries EMPLOYEES BY COUNTRY EMPLOYEESCHARACTERISTICS OF EMPLOYEESAt the end of 2024, Humble employed 1,262 people across a wide range of roles, from production and logistics to administrative and strategic functions. Every individual plays a vital role in driving the company’s success and continued development. Our employment terms are market-aligned and adhere to applicable collective agreements, with clear guidelines on workplace safety, equal treatment, and opportunities for development, as outlined in our HR Policy and Human Rights Policy.EMPLOYEES BY GENDER & COUNTRYWe have a balanced gender distribution among our employees, with 48% women and 52% men. Geographically, the largest share of employees is based in Sweden, followed by the United Kingdom, Portugal, Poland, Australia, Denmark, Norway, Germany, and Finland. This international presence contributes to a diversity of perspectives and skills across the Group and strengthens our global operations. Male52%Female48%EMPLOYEES BY GENDER 57 General informationEnvironmentalSocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 58
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 %Head count%Head countEmployees by employment type 2023-12-312024-12-31100%1,243100%1,262Total employees (head count)47%58048%611Female52%64852%651Male 1%150%0Other/not disclosed85%1,05584%1,066Full-time employees47%49147%503Female53%56453%563Male 0%00%0Other/not disclosed15%18816%196Part-time employees47%8953%104Female45%8447%92Male 8%150%0Other/not disclosed93%1,179Permanent employees47%557Female53%622Male0%0Other/not disclosed5%65Temporary employees60%39Female40%26Male0%0Other/not disclosed1%18Non-guaranteed hours employees44%8Female56%10Male0%0Other/not disclosed EMPLOYEE TURNOVERIn total, 249 individuals ended their employment during the year, corresponding to an employee turnover rate of 20%. This figure includes seasonal employees who were both hired and concluded their employment within the year, such as summer staff.EMPLOYEESEMPLOYEES BY TYPE OF EMPLOYMENT & GENDEROf all employees within the Group, 93% are permanently employed. The gender distribution is balanced across contract types, with a slightly higher proportion of women represented among part-time and temporary employees. 2024Employee turnover249Number of employees who left20%Employee turnover 58 General informationEnvironmentalSocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 59
NON-EMPLOYEESNON-EMPLOYEES IN OWN WORKFORCETo meet specific operational needs, temporary staff are engaged in production and warehousing, while consultants are contracted in areas such as finance, legal, and other specialist fields. These external resources are subject to our policy requirements on fair and safe working conditions, ensuring a safe and inclusive workplace for everyone operating within Humble. HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 %Head countCollective bargaining coverage 2024-12-3147%591Employees covered by collective bargaining agreements COLLECTIVE BARGAINING & FAIR WAGEHumble is committed to ensuring that all employees are offered fair, market-aligned, and adequate employment conditions by complying with relevant collective agreements where applicable, and by providing wages that meet or exceed local living costs. This includes rights related to wages, working hours, and occupational health and safety, in accordance with our Personnel Policy. By respecting collective agreements and ensuring adequate pay, we foster a secure and transparent workplace that promotes long-term stability and employee engagement. COLLECTIVE BARGAINING COVERAGEFifteen of our subsidiaries apply collective bargaining agreements, covering nearly half of our workforce (47%). The majority of employees under collective bargaining agreements work at our production subsidiaries, which are typically unionized.ADEQUATE WAGESAll Humble employees are paid an adequate wage aligned with applicable wage benchmarks and national legislation. 2024-12-31Non-employees38Self-employed19Contractors57Total non-employees 59 General informationEnvironmentalSocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 60
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 2023¹ 2024Employees by age (head count)-352Number of employees under 30 years old-28%Percentage of employees under 30 years old-652Number of employees between 30 and 50 years old-52%Percentage of employees between 30 and 50 years old-258Number of employees over 50 years old-20%Percentage of employees over 50 years old1,2431,262Total number of employees¹ In previous sustainability reports, the age distribution of employees was reported based on generational groupings, which means that data from previous years is not comparable with the data for 2024. Please refer to the 2023 annual report for historical data on age distribution. 2022-12-312023-12-312024-12-31Diversity of top management606555Female employees in top management38%37%36%Percentage of female employees in top management10011398Male employees in top management63%63%64%Percentage of male employees in top management000Other/gender not disclosed in top management0%0%0%Percentage of other/gender not disclosed in top management160178153Total employees in top management 15%14%12%Percentage of total employees in top management DIVERSITY METRICSAt the end of 2024, 36% of the Group’s employees in management positions were women, which is 4 percentage points below the target gender ratio of 60:40 in leadership roles. The share of women compared to men has decreased slightly (by 2%) since 2022, as has the total number of employees in management positions. The reduction in the number of leadership roles is partly due to the integration of several smaller subsidiaries into larger entities over recent years, resulting in fewer management teams. 36% 37% 38%64%63%63%2024 2023 2022KvinnorMänFemaleMale<3028%30-5052%>5020% DIVERSITYHumble is committed to creating an inclusive workplace where diversity is recognized as a strength and a prerequisite for innovation and growth. We work to promote a culture that values differences and provides equal opportunities regardless of gender, age, ethnicity, or background. By continuously monitoring and developing our diversity initiatives in line with our policies and Code of Conduct, we ensure that all employees have a fair opportunity to contribute and grow within the company.DIVERSITY OF TOP MANAGEMENTEMPLOYEES BY AGE 60 General informationEnvironmentalSocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 61
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 Non-employeesEmployeesHealth and safety metrics 202488%65%Percentage of own workers who are covered by health and safety management system1 00Number of fatalities as result of work-related injuries and ill-health127Number of recordable¹ work-related accidents47.517.9Rate of recordable¹ work-related accidents-2Number of cases of recordable work-related ill health-457Number of days lost to work-related accidents and ill-health HEALTH AND SAFETY METRICSHumble’s target is to ensure that zero serious workplace accidents occur at any of our sites. In 2024, a total of 28 accidents were recorded that resulted in medical treatment beyond first aid or time away from work. The injury rate, defined as the number of recordable workplace accidents per one million working hours, was 17.9 for employees. Two cases of work-related ill health were reported during the year. 1 Based on legal requirements and (or) recognized standards or guidelines.2 Workplace accidents that have resulted in any of the following: medical treatment beyond first aid, one or more days of absence from work, restricted work or reassignment to another position, diagnosis of a serious injury or illness, loss of consciousness, or death. HEALTH & SAFETYHumble is committed to ensuring a safe and healthy work environment where all employees feel secure and are well-equipped to carry out their duties without risk of injury or illness. Our HR Policy outlines our commitment to complying with applicable health and safety legislation, identifying and minimizing workplace risks, and providing appropriate training and resources to support employee well-being.In our production and warehouse operations, specific preventive measures and procedures are implemented to actively reduce the risk of workplace accidents. 61 General informationEnvironmentalSocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 62
2024Incidents, complaints and severe human rights impacts1Number of incidents of discrimination, including harassment1Number of complaints filed through channels for own workers to raise concerns0Amount of material fines, penalties, and compensation for damages as result of violations regarding social and human rights factors0Number of severe human rights issues and incidents connected to own workforce 2024Remuneration metrics11%Gender pay gap1 26.7Annual total remuneration ratio2 2024Work-life balance metrics100%Percentage of employees entitled to take family-related leaves12%Percentage of entitled employees that took family-related leaves16%Percentage of female employees9%Percentage of male employees INCIDENTS & COMPLAINTSDuring the year, one case of discrimination was reported at one of Humble’s subsidiaries. The incident was submitted through Humble’s whistleblowing channel (Speak Up) and investigated in accordance with our Whistleblower Policy.The case has been resolved, and the subsidiary has implemented appropriate measures to prevent similar incidents in the future.1 The gender pay gap is calculated as the average difference between the median base salaries for men and women across the Group’s subsidiaries.2Calculated as the ratio between the total compensation of the company’s highest-paid employee, the CEO of Humble Group AB, and the average median compensation of all other employees across all reporting entities. See Note 8 Remuneration to personnel etc. for further information on remuneration. HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 WORK-LIFE BALANCE METRICSPARENTAL LEAVEAll employees within the Group are entitled to parental leave in accordance with applicable national legislation. In 2024, 12% of employees, corresponding to 156 individuals, took parental leave - 95 women and 61 men.REMUNERATION METRICSGENDER PAY GAPThe gender pay gap, defined as the difference in average salary levels between female and male employees, was 11%.ANNUAL TOTAL REMUNERATION RATIOThe total remuneration ratio, which reflects the ratio between the annual compensation of the highest-paid employee and the median of all other employees, was 26.7 times. 62 General informationEnvironmentalSocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 63
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 IMPACT, RISKS & OPPORTUNITIESThe well-being of workers in our global supply chain is a key sustainability issue for Humble. We recognize that our operations can have both negative and positive effects on workers throughout the value chain, which means we must manage impacts, risks, and opportunities in a responsible manner. By promoting fair working conditions and upholding human rights, we strive to create a positive impact on workers and communities.IMPACT ON PEOPLE & THE ENVIRONMENTHumble may have a potential negative impact on workers in the value chain:•Occupational risks. Workers in agriculture, transportation, and waste management may be exposed to hazardous working conditions, including exposure to harmful substances, long working hours, and inadequate compensation, all of which can negatively affect their health and safety.•Lack of labor rights. In certain countries where the Group sources raw materials and finished products - including China, Vietnam, and Turkey - workers may lack adequate protection of their labor rights, such as freedom of association and the ability to engage in collective bargaining. This may lead to exploitative working conditions.•Child and forced labor. There are risks of child and forced labor among workers in the value chain, particularly in countries where ingredients such as soy, cocoa, nuts, and palm oil are produced. •Discrimination and exclusion. Risks of discrimination, gender inequality, and harassment exist in some of the sectors and geographies from which we source materials. WORKERS IN THE VALUE CHAINFINANCIAL RISKSThe potential negative impact may lead to significant business risks:•Reputational damage. Associations with violations of labor and human rights can harm brand credibility and erode customer trust, which in turn may negatively affect sales.•Legal penalties. Non-compliance with international labor standards may result in legal action, sanctions, or fines, leading to increased operational costs.•Supply disruptions. Poor working conditions among suppliers can result in strikes, employee dissatisfaction, or high staff turnover, disrupting the supply chain and affecting our ability to meet customer demand.•Limited access to funding. Companies exposed to labor-related risks may face investor hesitation, potentially leading to elevated capital costs and reduced access to financing.FINANCIAL OPPORTUNITIESBy actively addressing these issues, there are several financial opportunities for Humble: •Strengthened market position. Leading in ethical sourcing and maintaining high standards for workers' rights can help differentiate Humble from competitors and attract customer segments that value sustainability.•Increased access to capital. A strong commitment to workers’ rights can improve investor confidence and contribute to more favorable financing conditions.•More efficient supply chain. Improving working conditions and strengthening supplier relationships can reduce the risk of disruptions and contribute to cost savings and operational stability. 63 General informationEnvironmentalSocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 64
ACTIONS & TARGETS FOR WORKERS IN THE VALUE CHAINHumble has not yet adopted specific targets related to workers in the value chain. The implementation of Group-wide supplier due diligence processes will continue across the organization throughout 2025 and beyond. Several actions were taken in 2024 concerning workers in the value chain:•The Group’s Supplier Code of Conduct was distributed to over 200 suppliers via the digital platform Worldfavor for approval. By year-end, more than 130 suppliers had formally accepted the code through the platform. In addition, some subsidiaries have integrated the code directly into supplier contracts.•Risk assessments related to human rights were carried out for our key suppliers. A summary of the overall findings is presented on the following page.•The Group was approved as a member of the RSPO (Roundtable on Sustainable Palm Oil) in line with our commitment to human rights throughout the value chain. POLICIES, ACTIONS & TARGETSPOLICIES FOR WORKERS IN THE VALUE CHAINTo manage the identified impacts, risks, and opportunities, Humble has implemented strategies and policies that guide the Group’s work related to workers in the value chain.Guiding PrinciplesHumble is a signatory of the UN Global Compact and have committed to its ten principles, which include respect for human rights and labor rights. Our Human Rights Policy is aligned with the UN Guiding Principles on Business and Human Rights, the ILO Declaration on Fundamental Principles and Rights at Work, and the OECD Guidelines for Multinational Enterprises. Accordingly, we are committed to combating child labor, forced labor, and human trafficking.Supplier Code of ConductHumble has established a Supplier Code of Conduct that all significant suppliers are required to adhere to. This Code includes requirements to respect human rights, including the prohibition of child labor, forced labor, and discrimination. It emphasizes the importance of ensuring safe and healthy working conditions, fair wages, and reasonable working hours. The Code also requires suppliers to respect freedom of association and the right of workers to organize and engage in collective bargaining. The Supplier Code is publicly available at humblegroup.se.Implementation & MonitoringImplementation of the Supplier Code of Conduct is the responsibility of each subsidiary within the Group. The CEO of each subsidiary is accountable for ensuring that the Code and our policies are integrated into and complied with throughout their operations.We expect our suppliers to meet our standards and encourage them to communicate any challenges or requests for support in this regard. If deviations or negative impacts on human rights are identified through our subsidiaries’ activities, we have mechanisms in place to address them - including corrective actions and the reassessment of business relationships when necessary.To enable the reporting of misconduct, we have a Whistleblowing Policy and a publicly available whistleblowing channel. This allows employees, suppliers, and other stakeholders to anonymously report suspected violations of our policies or laws, which forms an important part of our monitoring and response process.HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 202464 General informationEnvironmentalSocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 65
HUMAN RIGHTS RISKSUNDERSTANDING SPECIFIC RISKS During the year, we developed processes to identify and assess which of our suppliers present an elevated risk of non-compliance with human rights and labor standards. Through ongoing risk assessments and analyses of working conditions across geographies and sectors, we are better able to focus our efforts on protecting vulnerable groups and minimizing negative impacts.As part of our supplier risk assessment, we apply the amfori BSCI Country Risk Classification, a country-level risk index based on the World Bank’s Worldwide Governance Indicators.Among the 519 key direct suppliers in 2024 -defined as those collectively accounting for 90% of the Group’s total purchasing volume - 86% were located in countries classified as low risk for human rights violations, with 80% based within the EEA and the UK. The remaining 14% of purchases originated from higher-risk countries, including China, Vietnam, Turkey, Indonesia, Peru, Bulgaria, and South Africa.In 2025, Humble will take a wider approach to risk assessment through an expanded analysis of the supply chain, with increased focus on raw material suppliers and subcontractors further downstream. The objective is to identify and address potential risks of human rights violations beyond direct supplier relationships. By consolidating efforts across subsidiaries and implementing shared guidelines, we aim to strengthen our responsible sourcing practices and ensure that human rights are respected and promoted throughout the entire supply chain.HUMAN RIGHTS INCIDENTSIn 2024, no confirmed human rights violations involving workers in the value chain were identified in connection with Humble or its subsidiaries. HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 Percentage of spend, 2024Human rights risks: Direct suppliers14%Risk countries86%Low-risk countries 65 General informationEnvironmentalSocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 66
APPENDIXOperations1Head office locationCompany nameHead officeStockholm, SwedenHumble Group ABProductionVellinge, SwedenAmazing Food & Ingredients Sweden ABDistributionLewes, UKAmber House Ltd.ProductionLublin, PolandAmerpharma SP.z o.o.ProductionGråbo, SwedenBars Production i Gråbo ABProductionPrestons, AustraliaBars Production Australia Pty LtdOfficeStockholm, SwedenBayn Solutions ABDistributionVarberg, SwedenBeson Gross ABOfficeGold Coast, AustraliaBody Science LtdProductionGöteborg, SwedenCarls-Bergh Pharma ABProductionDelsbo, SwedenDelsbo Candles ABOfficeMölndal, SwedenEwalco ABProductionHöganäs, SwedenEwalco Production ABProductionTrofa, PortugalFancystage Unipessoal LdaDistributionStaffanstorp, SwedenFirst Class Brands of Sweden ABDistributionKristiansand, NorwayFitnessgrossisten ASProductionGränna, SwedenFranssons Konfektyrer ABOfficeStockholm, SwedenGolden Athlete ABDistributionSheffield, UKGoSuperfoods Ltd.ProductionSkövde, SwedenGrahns Konfektyr ABOfficeHallsberg, SwedenGreen Sales Distribution ABProductionJönköping, SwedenGrenna Konfektyr ABProductionEkenäs, FinlandJalofoods / Oy Soya AbProductionLjung, SwedenKryddhuset ABProductionBorås, SwedenLa Praline Scandinavia ABProductionAveiro, PortugalLaboratório Francediet Lda (LEV Group)DistributionLangenfeld, GermanyMarabu Markenvertireb GmbhProductionHabo, SwedenNatumin Pharma ABOfficeStockholm, SwedenNaty ABDistributionÖrebro, SwedenNordic Sports Nutrition ABOfficeStockholm, SwedenPANDY Monday 2 Sunday ABStoresStockholm, SwedenPerformance R.Us AB DistributionNässjö, SwedenPrivab ABDistributionTrollhättan, SwedenPrivab Trollhättan ABDistributionChristchurch, UKSolent Global LtdOfficeStockholm, SwedenThe Humble Co. ProductionGlostrup, DenmarkTrue. ApSDistributionBarkåker, NorwayVitalkost ASOfficeMölndal, SwedenVitargo ABOfficeStockholm, SwedenWellibites ABHUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 REPORTING ENTITIESThe table below presents the entities included in Humble’s 2024 Sustainability Report. The Sustainability Report covers Humble’s headquarters and subsidiaries with operational activities, in contrast to the financial reporting which includes all legal entities, even those without employees or physical facilities. 661 Production includes manufacturing sites along with associated warehouses and office spaces. Distribution includes offices with warehousing operations. General informationEnvironmental SocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 67
CommentPage referenceDescriptionGRI standardGRI 2: General Disclosures 2021The organization and its reporting practices8-9, 20, 82, 91Organizational details2-1 66Entities included in the organization’s sustainability reporting2-2 Contact point is published on www.humblegroup.se30 Reporting period, frequency and contact point2-3 30 Restatements of information2-4 30, 70-71 External assurance2-5Activities and workers6-9, 15-18, 34Activities, value chain and other business relationships2-6 57-58Employees2-7 59Workers who are not employees2-8Governance20-26 Governance structure and composition2-9 20-21Nomination and selection of the highest governance body2-10 22Chair of the highest governance body2-11 24, 31Role of the highest governance body in overseeing the management of impacts2-12 31Delegation of responsibility for managing impacts2-13 31, 36, 70Role of the highest governance body in sustainability reporting2-14 20-22Conflicts of interest2-15 26, 32, 62Communication of critical concerns2-16 22Collective knowledge of the highest governance body2-17 24Evaluation of the performance of the highest governance body2-18 25Remuneration policies2-19 25Process to determine remuneration2-2062Annual total compensation ratio2-21Strategy, policies and practices5Statement on sustainable development strategy2-22 Sustainability policies are published on www.humblegroup.se31, 56, 64Policy commitments2-23 31Embedding policy commitments2-2431, 56, 64Processes to remediate negative impacts2-2556, 62, 64Mechanisms for seeking advice and raising concerns2-2639, 62, 65Compliance with laws and regulations2-27 33, 64Membership associations2-28Stakeholder engagement32Approach to stakeholder engagement2-29 59Collective bargaining agreements2-30GRI 3: Material Topics 2021Disclosures on material topics35-36Process to determine material topics3-1 37List of material topics3-2 Reported for each material topic42-44, 47, 49-50, 55-56, 63-64Management of material topics3-3 GRI INDEX HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 202467 General informationEnvironmental SocialAppendixAuditor's assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 68
CommentPage referenceDescriptionGRI standardGRI 300: Environmental DisclosuresGRI 301: Materials 201649-51Management of material topic3-3 Only reported for packaging materials51Materials used by weight or volume301-151Recycled input materials used301-2GRI 302: Energy 201642-45Management of material topic3-3 45Energy consumption within the organization302-145Energy intensity302-345Reduction of energy consumption302-4GRI 303: Water and Effluents 201847Management of material topic3-3 48Interactions with water as a shared resource 303-148Water consumption303-5GRI 305: Emissions 201642-45Management of material topic3-3 46Direct (Scope 1) GHG emissions305-146Energy indirect (Scope 2) GHG emissions305-246Other indirect (Scope 3) GHG emissions305-346GHG emissions intensity305-446Reduction of GHG emissions305-5GRI 306: Waste 202049-50, 52-53Management of material topic3-3 49, 52-53 Waste generation and significant waste-related impacts306-150, 52-53 Management of significant waste-related impacts306-253Waste generated306-353Waste diverted from disposal306-453Waste directed to disposal306-5GRI 400: Social DisclosuresGRI 401: Employment 201655-56Management of material topic3-3 Only employee turnover is reported58New employee hires and employee turnover401-162Parental leave401-3GRI 403: Occupational Health and Safety 201861Workers covered by an occupational health and safety management system403-861Work-related injuries403-961Work-related ill health403-10GRI 405: Diversity and Equal Opportunity 201622-23, 57, 60 Diversity of governance bodies and employees405-162Ratio of basic salary and remuneration of women to men405-2GRI 406: Non-discrimination 201662Incidents of discrimination and corrective actions taken406-1 HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 202468 General informationEnvironmental SocialAppendixAuditor's assuranceGRI INDEX (CONT.)BUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 69
CALCULATION FACTORSThe table below presents the data sources for the calculation factors used to calculate greenhouse gas emissions, water stress, and human rights risks. HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 202469 General informationEnvironmental SocialAppendixAuditor's assuranceCalculation factorsSourceFactorData pointReferenceUK Department for Energy Security and Net Zero (DESNZ), Conversion factors 2024FuelsScope 1 emissionsGHG emissions(page 46)Association of Issuing Bodies (AIB), Residual Mixes and European Attribute Mix 2023; Australian Government, National Greenhouse Accounts Factors 2023Electricity (market based)Scope 2 emissionsCarbon Footprint, International Electricity Factors 2024Electricity (location based)Energiföretagen, Fjärrvärmens lokala miljövärden 2024District heating (Sweden)European Environment Agency (EEA), Exiobase 3.8.2Scope 3 emissionsWorld Resources Institute (WRI), Aqueduct Water Risk Atlas v4.0Risk indexHigh water stressWater consumption(page 48)amfori BSCI, Countries' Risk Classification (As of January 2024)Risk index (World Governance Indicators)Country riskHuman rights risks (page 65) BUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 70
INDEPENDENT AUDITOR’S ASSURANCE REPORT ON THE SUSTAINABILITY REPORT OF HUMBLE GROUP ABTo the Board of Directors of Humble Group AB,corporate identity no. 556794-4797.INTRODUCTIONWe have been engaged by the Board of Directors of Humble Group AB to provide limited assurance on the sustainability report of the Humble Group AB for the financial year 2024.THE RESPONSIBILITY OF BOARD OF DIRECTORS AND MANAGEMENTThe Board of Directors is responsible to present the sustainability report in accordance with relevant criteria. The sustainability report is prepared in accordance with the criteria in the Swedish Annual Accounts Act chap 6 in accordance with the older wording that applied before 1 July 2024, as well as the company’s own developed accounting and calculation principles. The Board of Director’s responsibility also includes the internal control deemed necessary to prepare a sustainability report that is free from material misstatement, whether due to fraud or error. THE RESPONSIBILITY OF THE AUDITOROur responsibility is to express a conclusion on the sustainability report based on our limited review.We have conducted our limited review in accordance with ISAE 3000 Assurance engagements other than audits and reviews of historical financial information. A limited review consists of making inquiries, primarily to persons responsible for preparing the sustainability statement, performing analytical reviews and performing other review procedures. A limited review has a different focus and a significantly smaller scope compared to the focus and scope of an audit in accordance with International Standards on Auditing and generally accepted auditing standards in general.The audit firm applies ISQM 1 (International Standard on Quality Management) and thus has a comprehensive quality control system, which includes documented policies and procedures regarding compliance with professional ethics, standards for professional practice and applicable requirements in laws and regulations. We are independent in relation to Humble Group AB and their subsidiaries in accordance with generally accepted auditing standards in Sweden and have otherwise fulfilled our professional ethical responsibilities in accordance with these requirements.HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 AUDITOR’S ASSURANCE 70 General informationEnvironmental Social AppendixAuditor's assuranceThe audit procedures taken in a limited review do not allow us to obtain sufficient assurance to be aware of all the important facts that could have been identified if an audit had been carried out. Therefore, the stated conclusion based on a limited review does not have the certainty of an explicit conclusion based on an audit.Our limited review of the sustainability report is based on the criteria selected by the Board of Directors, as defined above. We believe that these criteria are appropriate for the preparation of the sustainability report.We believe that the evidence obtained during our limited review is sufficient and appropriate to support our opinions below.STATEMENTSBased on our limited review, no circumstances have emerged that give us reason to believe that the sustainability report has not, in all material respects, been prepared in accordance with the criteria set out above by the Board of Directors.BDO Mälardalen ABDate and signature on the Swedish originalMaria LoghmaniAuthorized Public Accountant BUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 71
AUDITOR’S REPORT ON THE STATUTORY SUSTAINABILITY REPORTTo the general meeting of the shareholders in Humble Group AB, corporate identity no. 556794-4797.ENGAGEMENT AND RESPONSIBILITYIt is the board of directors who is responsible for the statutory sustainability report for the year 2024 on pages 29-69 and that it has been prepared in accordance with the Annual Accounts Act according to the prior wording that was in effect before 1 July 2024.THE SCOPE OF THE AUDITOur examination has been conducted in accordance with FAR’s standard RevR 12 The auditor´s opinion regarding the statutory sustainability report. This means that our examination of the statutory sustainability report is different and substantially less in scope than an audit conducted in accordance with International Standards on Auditing and generally accepted auditing standards in Sweden. We believe that the examination has provided us with sufficient basis for our opinion.OPINIONSA statutory sustainability report has been prepared. BDO Mälardalen ABDate and signature on the Swedish originalCarl-Johan KjellmanAuthorized Public AccountantThis is a translation of the Swedish language original. In the event of any differences between this translation and the Swedish language original, the latter shall prevail. HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 202471 General informationEnvironmental Social AppendixAuditor’s assuranceBUSINESS OVERVIEW CORPORATE GOVERNANCESUSTAINABILITYANNUAL REPORT
Page 72
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 ANNUAL REPORT 72
Page 73
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 73 Auditor’s report Consolidated financial statements and notes Parent company financial statements and notes Management administration report SUSTAINABILITY CORPORATE GOVERNANCE ANNUAL REPORT BUSINESS OVERVIEW MANAGEMENT ADMINSTRATION REPORT ABOUT THE GROUP The Board of Directors and the President of Humble Group AB, with corporate registration number 556794–4797 and registered office in Stockholm, hereby present the annual report for the financial year 2024. Humble is a young, dynamic, and innovative FMCG group that delivers products that are better for both people and the planet. Humble Group AB is the parent company in the consolidated financial statements presented. For a detailed description of the group structure, see Note 48 Shares in subsidiaries. ANNUAL OVERVIEW SIGNIFICANT EVENTS DURING 2024 The Group’s net revenue amounted to MSEK 7,708 (7,050), corresponding to an increase of 9%. EBIT totaled MSEK 376 (318), and profit after financial items amounted to MSEK 124 (-61). On January 2, Humble divested all shares in Bayn Production AB as part of its long-term strategy to streamline the Swedish manufacturing business. On April 17, phase 2 of the property sale transaction was completed. As part of the transaction, seven properties were sold through a sale and leaseback arrangement. On May 22, the Annual General Meeting resolved to re-elect board members Dajana Mirborn, Henrik Patek, Ola Cronholm, Sara Berger, and Pål Bruu for the period until the end of the next AGM. Noel Abdayem was elected as a new board member. Dajana Mirborn was elected Chair of the Board. The AGM also resolved to issue warrants of series 2024/2027 and to implement an incentive program for key personnel and senior executives within the company. On June 19, Humble announced an expansion of its existing credit facility agreement by a total of MSEK 300, of which MSEK 150 is a short-term loan and MSEK 150 is an extension of the existing revolving credit facility. On August 23, the Board of Humble Group AB presented new financial targets. The decision was based on the structural development the Group has undergone since the previous targets were announced on December 1, 2021. The new targets aim to reflect Humble’s ambitions for growth and profitability, as well as the company’s medium- term business plan. On September 19, Humble held its first Capital Markets Day. On September 27, trading in Humble Group AB’s shares commenced on the Nasdaq Stockholm main market. MSEK 2024 2023 2022 2021Net sales 7,708 7,050 4,800 1,486EBITDA 688 659 504 -41EBIT 376 318 257 -118Earnings before tax 161 -61 1 -215Return on Equity 3.1 neg neg negSolvency (%) 55.9 54.6 45.6 45.2 MSEK 2024 2023 2022 2021Net sales 59 44 21 2EBIT -19 -28 -38 0Earnings before tax 40 -243 -204 -108Return on Equity 0.8 neg neg negSolvency (%) 65.4 65.1 54.6 57.6See from page 1 40 for definition and calculation of key ratios and Alternative Performance M easures (APM ) ConsolidatedParent company
Page 74
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 74 Auditor’s report Consolidated financial statements and notes Parent company financial statements and notes Management administration report SUSTAINABILITY CORPORATE GOVERNANCE ANNUAL REPORT BUSINESS OVERVIEW On December 23, Humble announced an expansion of its existing credit facility agreement by MSEK 300, of which MSEK 150 is intended to refinance the MSEK 150 bridge loan from Nordea and SEB. The remaining MSEK 150 is subject to certain restrictions and is intended to be invested in Humble’s ongoing growth projects. CORPORATE GOVERNANCE Humble has chosen to publish the corporate governance report as a separate document from the annual report, in accordance with Chapter 6, Section 8 of the Swedish Annual Accounts Act. The report is available on pages 19–27. INFORMATION ON GUIDELINES FOR DETERMINING SALARIES AND REMUNERATION TO EXECUTIVES AND THE BOARD To attract, develop, and retain senior executives with relevant experience and competence, it is important for the company to offer a competitive remuneration package aligned with market standards for executives across various industries. Remuneration to senior executives consists of fixed salaries, short- and long-term variable compensation, pensions, and other customary benefits. Total remuneration should be market- based and competitive, reflecting individual performance and responsibilities. See Note 8 Remuneration to Employees, etc. for further information. THE SHARE At the end of the financial year, 446,575,533 shares (443,544,543) were listed for trading. The company does not hold any treasury shares and did not repurchase any of its own shares during 2024. During the year, the number of shares increased by 3,030,990 (10,684,963) through non-cash issues. For more information about the share and its quota value, see Note 53 Share Capital. There is only one class of shares, and all shares carry equal voting rights. Humble Group AB is listed under the ticker symbol HUMBLE on Nasdaq Stockholm’s main market. SIGNIFICANT RISKS AND UNCERTAINTIES Humble continuously works to identify, evaluate, and manage the various risks and exposures faced by Group companies. The Group’s financial position and performance are affected by a range of risk factors that should be considered when assessing the company and its future performance. The primary risks are considered to be: FINANCING Access to working capital for the company’s operations and funding to meet the Group’s investment needs is essential for building a profitable and long-term sustainable business. Humble currently maintains a constructive dialogue with investors to address this risk. CURRENCY EXPOSURE The Group’s currency exposure primarily arises from the translation of foreign subsidiaries reporting in GBP, EUR, or USD into SEK, as well as major raw material purchases in EUR and GBP. Humble actively works to minimize currency exposure in larger purchases through currency exchange and, when necessary, short-term hedging. As of the end of the reporting period, the Group had no significant active currency hedges in place. DISTRIBUTION CHANNELS AND ACCESS TO RAW MATERIALS The global availability of raw materials is a critical component of Humble’s value chain. Ongoing market uncertainty caused by the Ukraine crisis and continued instability in global shipping and logistics patterns pose risks to the Group’s access to raw materials, export/import prices, freight routes, and other vital distribution channels. This has a direct impact on the Group’s margins. The Group maintains close and continuous dialogue with suppliers to monitor the market development of key ingredients used in the production of the Group’s products. This proactive approach helps Humble mitigate the risk of price increases or delivery delays in raw material procurement. PERSONNEL A large part of Humble’s operations is driven by entrepreneurs with unique and specialized expertise in their respective areas. The Group relies on maintaining a strong motivation among its employees to retain key talent and attract future high-quality competencies. Humble continuously works to develop its organization and to engage and motivate employees to manage risks associated with potential personnel changes. CLIMATE RISK Climate change presents several financial risks for Humble. Extreme weather events may damage
Page 75
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 75 Auditor’s report Consolidated financial statements and notes Parent company financial statements and notes Management administration report SUSTAINABILITY CORPORATE GOVERNANCE ANNUAL REPORT BUSINESS OVERVIEW production facilities, disrupt supply chains, and impact the availability of raw materials, leading to operational disturbances and increased costs. Stricter climate regulations and market shifts may raise operating expenses and necessitate investments in sustainable solutions to meet growing customer demand for environmentally friendly products. Insufficient climate action may harm brand reputation and reduce competitiveness, while climate-related disruptions among suppliers risk driving up raw material prices and affecting production capacity. For more information on climate-related risks and Humble’s climate efforts, see the Sustainability Report. HEDGE ACCOUNTING AND OTHER OFF- BALANCE SHEET ARRANGEMENTS At the end of the financial year, there were no material ongoing hedge relationships recognized in the company’s accounts. Furthermore, there are no other off-balance sheet arrangements apart from pledged assets. For more information, see Note 30 Pledged Assets and Contingent Liabilities. DEVELOPMENT POLICY Humble continuously engages in developing new, innovative products with the aim of delivering offerings that are better for people and the planet. Within the Group's subsidiaries, several individuals work on a project basis with product development. For those projects or products where, future economic benefits are expected upon completion, and where the criteria according to the Swedish Annual Accounts Act are otherwise met, direct costs of product development are capitalized as an asset in the company’s balance sheet. The asset is amortized over the estimated period of economic benefit per product, typically estimated at five years. For more information about the Group’s product development policy, see Note 14 Intangible Assets. EXPECTED FUTURE DEVELOPMENT Over the past year, Humble has continued to refine its business model and established strong conditions for continued high growth in the years ahead. The foundation has been laid to build the FMCG powerhouse of the future. Humble is expected to focus on strengthening underlying profitability, converting earnings into stable cash flows, and reducing the net debt ratio. This is expected to continue to improve the Group’s financial position. The Board and management collectively assess the Group’s outlook as positive. Humble is not currently subject to Pillar 2 but monitors and follows developments regarding potential future applicability. IMPACT OF THE UKRAINE CRISIS AND THE WAR IN ISRAEL AND GAZA The ongoing war between Russia and Ukraine, along with recent developments in the Middle East that have led to a renewed escalation of the long- standing conflict in Israel and Gaza, continues to contribute to geopolitical volatility, impacting many industries including food and beverages. Humble’s direct exposure to these countries is very limited, and the direct impact has therefore been minimal. An indirect consequence of these events has been sharply rising raw material and energy prices, though signs of price stabilization are now beginning to emerge. Humble’s growth targets and strategy of growing both organically and through acquisitions remain unchanged despite the global situation, and the impact on Humble’s existing subsidiaries due to rising prices is currently limited. RISING FREIGHT AND CUSTOMS COSTS IN A VOLATILE MARKET Given the continued global instability, the transportation sector has continued to raise prices, affecting many industries to varying degrees. For Humble, this has resulted in pricing changes related to delivery and logistics. While this may have a short-term impact, Humble’s subsidiaries have historically been effective in adapting costs relative to pricing, creating a structure that enables price adjustments to the market in response to increased raw material and fuel costs. The United States has signaled the introduction of new tariffs on many countries. Humble currently has limited export exposure to the U.S. and therefore assesses the potential impact of higher tariffs as low. RISING ELECTRICITY AND PURCHASE PRICES AND MARKET INTEREST RATES Humble’s subsidiaries can be categorized into manufacturing and production, distributors, and brands. The production companies, due to their facilities, naturally face exposure to the energy market and fluctuating energy prices. Humble actively monitors market developments and works to ensure pricing that is as market-aligned as possible.
Page 76
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 76 Auditor’s report Consolidated financial statements and notes Parent company financial statements and notes Management administration report SUSTAINABILITY CORPORATE GOVERNANCE ANNUAL REPORT BUSINESS OVERVIEW During 2024, the Riksbank chose to lower the policy rate, resulting in a decline in borrowing costs. Humble’s primary interest rate exposure is linked to the underlying development of STIBOR 3M. In 2024, STIBOR 3M decreased from 4.08% to 2.54% by the end of the year. For more information, see Note 4 Financial Risk Management. APPROPRIATION OF PROFITS The Board of Directors of Humble Group AB proposes that no dividend be paid for the financial year 2024 and that the profit for the year be allocated as follows (SEK): Accumulated profit or loss-291,813,362Share premium reserve4,958,909,125Net loss for the year154,334,436Total4,821,430,199Proposed appropriation of profits4,821,430,199
Page 77
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 77 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME MSEK Note 2024 2023Net sales57,708 7,050Capitalised work on own account 7 83Other operating income 6 140 262Raw materials and consumables -5,289 -4,921Other external expenses 7 -990 -851Personnel expenses 8 -834 -790Other operating expenses9-54 -174Depreciation, amortization and impairment14, 15, 16-312 -341EBIT 376 318Profit from shares in associated companies and joint ventures 180 1Financial income 11 13 13Financial expenses 11 -228 -393 PROFIT AND LOSS AFTER FINANCIAL ITEMS 161 -61Income tax 12-37 -45PROFIT AND LOSS AFTER TAX 124 -106Profit and loss is attributable to:Owners of the Parent Company 124 -106Non-controlling interest 180 0Total 124 -106Other comprehensive incomeItems that may be reclassified to profit or loss:Exchange differences in translation of foreign operations197 6COMPREHENSIVE INCOME FOR PERIOD 321 -100The comprehensive income for the period is attributable to:Owners of the Parent Company 321 -100Non-controlling interest 180 0Total 321 -100Earnings per share before dilution (SEK)130.28 -0.28Earnings per share after dilution (SEK)130.28 -0.28
Page 78
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 78 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT CONSOLIDATED BALANCE SHEET – ASSETS MSEK Note 2024-12-31 2023-12-31ASSETSFixed assetsIntangible assetsCapitalised product develoment costs201221Customer relationships279413Trademarks and brands1,7321,676Software, Licensens & Domains160Goodwill3,8073,702Total intangible assets146,035 6,012Tangible assetsBuildings and land6048Machines and other technical equipment9683Equipment, tools and installations4954Ongoing new facilities and advances567Total tangible assets15261 192Right-of-use assets16419299Deferred tax assets173729Financial assetsEquity in associated companies and joint ventures185351Other long-term securities holdings19833Other long-term receivables192915Total financial assets 90 99Total fixed assets 6,842 6,631Current assetsInventoryRaw materials and consumables99102Finished goods and goods for sales1,061838Total inventory201,160 940Short-term receivablesAccounts receivables21599561Other short-term receivables2216097Prepaid expenses and accrued income23152157Cash and cash equivalents24432401Total short-term receivables 1,343 1,216Assets classified as held for sale350131Total current assets 2,503 2,287TOTAL ASSETS 9,345 8,918
Page 79
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 79 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT CONSOLIDATES BALANCE SHEET – EQUITY & LIABILITIES MSEK Note 2024-12-31 2023-12-31EQUITY AND LIABILITIESEquityShare capital9898Other equity contributed5,0585,027Translation reserve380183Retained earnings-315-439Attributable to Parent Company's shareholder535,221 4,869Non-controlling interest0 0Total shareholders equity5,221 4,869Long-term liabilitiesInterest-bearing liabilities261,4061,197Contingent considerations2824165Long-term lease liabilities16357258Deferred tax liabilities17439474Provisions27017Other long-term liabilities2819318Total long-term liabilities2,419 2,129Short-term liabilitiesInterest-bearing liabilities26360253Contingent considerations28115336Current lease liabilities169567Tax liabilities175392Accounts payable4679652Other current liabilities28205324Accrued expenses and prepaid income29198152Total 1,705 1,876Liabilities directly associated with assets classified as held for sale35044Total short-term liabilities1,705 1,920TOTAL EQUITY AND LIABILITIES9,345 8,918
Page 80
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 80 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT CONSOLIDATED STATEMENT OF CHANGES IN EQUITY MSEKShare capitalOther equity contributedTranslation reserveRetained EarningsTotalNon-controlling interestTotal shareholders equityOpening balance January 1, 2023 66 4,131 177 -338 4,036 0 4,036Net income for period -106 -106 -106Other comprehensive income 6 6 6Total comprehensive income0 0 6 -106 -100 0 -100Transaction with owners in their capacity as owners:Share issue 31 927 958 958Transaction costs -28 -28 -28Share buyback -1 -1 -1Warrants program -1 -1 -1Adjustment to prior year 4 4 4Total transaction with owners in their capacity as owners31 897 0 4 932 0 932Ending balance December 31, 2023 98 5,027 183 -439 4,869 0 4,869Opening balance January 1, 2024 98 5,027 183 -439 4,869 0 4,869Net income for period 124 124 0 124Other comprehensive income 197 197 197Total comprehensive income0 0 197 124 321 0 321Transaction with owners in their capacity as owners:Share issue 1 29 29 29Transaction costs 0 0Share buyback 0 0Warrants program 2 2 2Adjustment to prior year 0 0Total transaction with owners in their capacity as owners1 31 0 0 31 0 31Ending balance December 31, 2024 98 5,058 380 -315 5,221 0 5,221 Attributable to equity holders of the Parent Company
Page 81
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 81 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT CONSOLIDATED STATEMENT OF CASH FLOW MSEK Note 2024 2023 OPERATING ACTIVITIES Profit and loss after financial items 161 -61 Adjustement for non-cash items Depreciation and Amortisation 14, 15, 16 312 341 Other items 33 136 304 Paid tax -77 -54 Cash flow from operating activities before change in net working capital 532 530 CHANGE IN WORKING CAPITAL Change in inventories (increase - / decrease + ) -210 27 Change in short term receivables (increase - / decrease + ) -77 190 Change in short term liabilities (increase - / decrease + ) 55 341 Sum of change in working capital -232 558 Cash flow from operating activities 300 1,088 INVESTING ACTIVITIES Acquisition of intangible assets 14 -34 -112 Acquisition of tangible assets 15 -120 -49 Disposal of financial assets 53 0 Disposal of subsidaries 112 107 Acquisition of subsidiaries, acquired business + paid earn-outs 31 -310 -369 Cash flow from investing activities -299 -423 FINANCING ACTIVITIES 34 Share issue funds 0 875 Costs related to share and bond issues, and refinancing -6 -111 Bond financing 0 -1,800 Received interest on financing activities 8 0 Paid interest due to financing activities -144 -216 New loans 799 1,546 Repayment of loans -529 -823 Loan to joint venture -14 0 Amortization of lease liability -96 -72 Cash flow from financing activities 18 -601 Decrease/Increase in cash and cash equivalents 19 64 Cash and cash equivalents at beginning of period 401 338 Exchange rate differences 12 -1 Cash and cash equivalents at end of period 432 401
Page 82
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 82 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT GROUP NOTES NOTE 1 – GENERAL INFORMATION This consolidated financial statement includes the parent company Humble Group AB, corporate registration number 556794–4797, and its subsidiaries. Humble Group AB is a parent company registered in Sweden, with its registered office in Stockholm at Ingmar Bergmans gata 2, SE- 114 34 Stockholm. Humble is a young, dynamic, and innovative FMCG group that delivers products that are better for both people and the planet. The Group consists of several operating companies active in fast-growing segments such as sugar reduction, functional foods, and sustainable beauty and health. The Board of Directors approved the consolidated financial statement for publication on April 9, 2025. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES Humble describes the most significant accounting policies in connection with each note in order to enhance understanding of the respective accounting area. The Group focuses on explaining the accounting choices it has made within the framework of applicable IFRS® Accounting Standards and avoids repeating paragraph text from the standards unless the Group considers it particularly important for understanding the content of the note. These policies have been applied consistently to all years presented, unless otherwise stated. BASIS OF PREPARATION The consolidated financial statements have been prepared in accordance with the Swedish Annual Accounts Act, RFR 1 Supplementary Accounting Rules for Groups, and International Financial Reporting Standards (IFRS) and interpretations issued by the IFRS Interpretations Committee (IFRS IC) as adopted by the EU. Preparing financial statements in accordance with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise judgment in applying the Group’s accounting policies. Areas involving a high degree of judgment, complexity, or areas where assumptions and estimates are significant to the consolidated financial statements are disclosed in Note 3 Significant Accounting Estimates and Judgments. The consolidated financial statements include the legal parent company (Humble Group AB) and its subsidiaries over which the parent company has control. The financial statements have been prepared using the historical cost method, except for certain financial assets and liabilities measured at fair value. Subsidiaries Subsidiaries are all entities over which the Group has control. All subsidiaries are 100% owned and fully controlled through ownership interests. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are included in the consolidated financial statements from the date control is transferred to the Group. They are excluded from the consolidated financial statements from the date that control ceases. Associated companies and joint ventures Associates are entities over which Humble has significant influence. A strong indicator of such influence is when the Group holds more than 20% but less than 50% of the voting rights. The investment in Snacksmack AB is classified as an associate. Joint ventures are entities over which Humble has joint control together with one or more external parties. Joint control exists only when decisions about relevant activities require the unanimous consent of the parties sharing control. The investment in Amerpharma is classified as a joint venture. Investments in associates and joint ventures are accounted for using the equity method.
Page 83
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 83 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT Non-controlling Interests Owners with a non-controlling interest hold a limited ownership of shares and voting rights in a subsidiary and consequently have a limited entitlement to the subsidiary’s equity. Non- controlling interests are reported separately in the Group’s income statement, statement of comprehensive income, statement of changes in equity, and balance sheet. Humble Hatten AB is Humble’s only non-wholly owned subsidiary, and holders of non-controlling interests own 22.4% of the company. CONSOLIDATED FINANCIAL STATEMENTS TRANSLATION OF FOREIGN CURRENCY Unless otherwise stated, all amounts are reported in millions of Swedish kronor (MSEK). Figures in parentheses refer to the previous year. Functional Currency and Presentation Currency Items included in the financial reports of the various entities within the Group are measured using the currency of the primary economic environment in which the respective entity operates (functional currency). In the consolidated financial statements, Swedish kronor (SEK) are used, which is the functional currency of the parent company and the Group’s presentation currency. Foreign exchange gains and losses relating to loans and cash and cash equivalents are recognized in the statement of comprehensive income as financial income or financial expenses. All other foreign exchange gains and losses are recognized under Other Operating Expenses or Other Operating Income in the statement of comprehensive income. ADOPTION AND EFFECTS OF NEW AND REVISED IFRS ACCOUNTING STANDARDS EFFECTIVE IN 2024 IAS 1: Classification of Liabilities as Current or Non- current and Non-current Liabilities with Covenants. The amendments require that a company’s right to defer settlement of a liability for at least twelve months after the reporting period must be substantive and must exist at the reporting date. The classification should not be influenced by management’s intention to extend the loan; rather, if the right to extension exists as of the balance sheet date, the liability may be classified as non- current. If an agreement with the bank is reached after the reporting date but before the financial statements are issued, the liability should not be classified as non-current. If the extension of a liability is conditional upon covenants being met on or before the balance sheet date, then those covenants must be fulfilled by the balance sheet date in order for the liability to be classified as non-current. Covenants that must be met after the balance sheet date do not affect the assessment of whether the company has the right to extend the liability at the reporting date. None of the accounting standard changes that came into effect during the 2024 financial year had a material impact on the financial statements. NEW AND AMENDED STANDARDS NOT YET ADOPTED BY THE GROUP A number of standard amendments are effective for financial years beginning on or after January 1, 2025, and have not been applied in the preparation of these financial statements. With the exception of IFRS 18, the Group does not expect these changes to have any material effect on the financial statements. IFRS 18 – Presentation and Disclosure in Financial Statements replaces IAS 1 Presentation of Financial Statements. IFRS 18 introduces new requirements for how financial reports are presented, with a particular focus on: Income Statement: Mandatory subtotals such as Operating Profit will be introduced. Revenue and expenses will be categorized into five groups: Operating, Financing, Investing, Income Taxes, and Discontinued Operations. Aggregation and Disaggregation of information, including overarching principles for how information should be grouped and broken down in the financial statements. Disclosures on Management Defined Performance Measures (MPMs), which must be presented in a single note, including reconciliations to the nearest IFRS-compliant subtotal. IFRS 18 becomes effective for reporting periods beginning on or after January 1, 2027, with early application permitted. Companies will be required to restate comparative periods. The Group has not yet evaluated the impact of IFRS 18 on its financial reporting. IFRS 18 will not affect the accounting or measurement of the Group’s transactions but will impact the format and presentation of the Group’s financial statements, including the financial reports and notes. IFRS 18 may also affect the key performance indicators presented and how they are calculated.
Page 84
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 84 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 3 – SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGMENTS The Group makes estimates and judgments about the future. The accounting estimates resulting from these, by definition, will rarely equal the actual outcomes. The estimates and judgments that involve a significant risk of material adjustments to the carrying amounts of assets and liabilities during the next financial year are addressed under the section “Significant Judgments” below. Other estimates and judgments made by the Group in applying its accounting policies during the preparation of the financial statements are disclosed under the section “Other Judgments.” SIGNIFICANT JUDGMENTS Key assumptions for impairment testing of goodwill, trademarks, and other intangible assets The Group annually assesses whether there is any indication of impairment for goodwill, trademarks, and other intangible assets, in accordance with the accounting policies described in Note 14 Intangible Assets. The recoverable amount for cash- generating units (CGUs) is determined by calculating the value in use, which requires the use of certain assumptions. Humble performs its impairment tests at the segment level, as these are considered the lowest CGUs at which management monitors financial performance. The calculations are based on cash flow projections derived from budgets approved by management and the Board of Directors for the next five years. The projected cash flows are discounted using a weighted average cost of capital (WACC) of 9.16% for 2024 (11.02%). Cash flows beyond the five-year period are extrapolated using a long-term growth rate of 2%. The applied growth rate is consistent with industry forecasts for each CGU’s respective sector. For more information, see Note 14 Intangible Assets. OTHER JUDGMENTS Contingent Consideration Under the terms of contingent consideration agreements related to acquisitions, the Group is required to pay additional consideration and employment-related compensation provided that certain key financial targets are met. These targets are typically linked to the future EBITDA or EBIT of the acquired subsidiaries. The fair value of the contingent consideration agreement is based on management’s assessment of the most likely amount to be paid, based on the conditions outlined in the share purchase agreement. Liabilities for contingent consideration are remeasured in each reporting period based on actual performance, and changes in estimates are recognized in profit or loss. Humble performs an initial estimate of the expected future outcome of the contingent consideration, which at initial recognition has historically ranged between 70–80% of the maximum agreed amount. As of the balance sheet date, the nominal value of the short-term portion of the contingent consideration amounts to MSEK 119 and is considered highly likely to be the actual outcome in the upcoming financial year. The nominal value of the long-term portion is MSEK 29. A change in the estimate of+/- 10% could result in a profit or loss impact of+/- MSEK 3, and the Group has assessed that this does not represent a material risk of significant impact on the next financial year. For more information, see Note 4 Financial Risk Management. Purchase Price Allocation In connection with business combinations, a purchase price allocation is performed in which the fair value at the acquisition date of identifiable assets, liabilities, and contingent liabilities is recognized. The valuation of identified assets and liabilities includes both items recognized in the acquiree’s balance sheet and those not previously recognized, such as intangible assets. Initially, intangible assets that may have value, such as customer relationships, trademarks, etc., are identified. These assets generally have no observable market price and are therefore measured using various valuation techniques. These methods are based on assumptions regarding future cash flows, revenue growth, EBIT margins, tax rates, and discount rates across different jurisdictions. Such calculations require a high degree of estimation, which must be carefully evaluated, measured, and analyzed. It should also be noted that preliminary calculations may be adjusted due to incomplete information at the time of initial recognition. Consequently, adjustments to reported values may occur within the so-called measurement period of up to 12 months after the acquisition.
Page 85
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 85 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT Useful Lives of Intangible Assets Humble has several intangible assets recognized in the balance sheet with indefinite useful lives. These include goodwill and trademarks. Humble’s rights to the Group’s trademarks and intellectual property are unlimited and not restricted by time. The Group continuously evaluates the carrying value of each asset, as well as whether there is a need to determine a finite remaining useful life for its trademarks and intellectual property rights. Capitalized Development Costs As the Group has evolved from a technology- focused business to a broader FMCG group—and in light of the industry's shift toward faster product life cycles—the Group has updated its estimate and assessment criteria for the application of accounting policies related to capitalized development costs. To enable a relevant comparison with the previous financial year and to reflect this updated accounting assessment, capitalized development costs have been adjusted under items affecting comparability for the comparative period. See Note 10 Items Affecting Comparability. Provision for Expected Credit Losses Trade receivables amount to MSEK 599. Humble has historically experienced a very low level of customer credit losses over a prolonged period. Based on this, the Group has assessed the provision for credit losses to be MSEK -5 (-5). For more information, see Note 21 Accounts Receivables, which includes an aging analysis and details of changes in the provision during the year. Assessment of Lease Contracts with Extension Options Humble is a lessee in contracts for office premises, machinery, vehicles, and office equipment. The office premises are typical offices located in major cities, where access to similar properties is deemed good. The Group has not incurred any material leasehold improvements related to these properties. The contracts for office premises typically include a formal option for Humble to extend the lease, often structured such that the lease is automatically extended for 12 months unless terminated by the Group 3–6 months prior to the contract’s expiration. In assessing whether it is reasonably certain that the Group will exercise an extension option, management primarily considers the difficulty of replacing the space and the remaining time until the automatic renewal takes effect. Overall, the lease term for the Group's office premises ranges between 1 and 15 years, with an average lease term of four years. No extension options have been included in leases for machinery, vehicles, or office equipment. Deferred Tax Deferred tax assets amount to MSEK 37 (29), mainly attributable to tax loss carryforwards for Humble Group AB. The tax loss carryforwards were generated between 2014 and 2023. The Group has assessed that these carryforwards will be utilized against future taxable profits. This assessment is based on the approved business plan and budget for the subsidiary, with all subsidiaries in the Group expected to generate taxable profits from 2025 onward. The tax loss carryforwards can be carried forward indefinitely and have no expiration date. NOTE 4 – FINANCIAL RISK MANAGEMENT FINANCIAL RISK FACTORS Through its operations, the Group is exposed to a variety of financial risks, including macroeconomic and market risks, foreign exchange risk, fair value interest rate risk, cash flow interest rate risk, credit risk, liquidity risk, and refinancing risk. The Group seeks to minimize any potential adverse effects on its financial performance. The objectives of the Group’s financial management are to: ensure the Group can meet its payment obligations manage financial risks secure access to necessary financing optimize the Group’s net financial income/expense Risk management within the Group is predominantly carried out at the subsidiary level, in accordance with policies approved by Humble’s executive management. The Board of Directors provides written principles for overall risk management, as well as policies covering specific areas such as foreign exchange risk, interest rate risk, credit risk, the use of financial derivative
Page 86
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 86 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT instruments and non-derivative financial instruments, and the investment of surplus liquidity. The Group’s financial position and performance are affected by various risk factors that must be considered when assessing the company and its future performance. The primary risks deemed relevant to the Group are described below. a) Market risk Foreign exchange risk The Group operates internationally and is exposed to currency risks arising from various currency exposures, primarily concerning the currencies EUR, GBP, and USD. Currency risk primarily arises from the translation of foreign subsidiaries' income statements and balance sheets into the Group’s reporting currency, which is SEK (translation balance sheet exposure). The Group's policy is not to hedge the translation exposure related to foreign net assets in order to reduce the translation risk in the financial statements. Sensitivity Analysis – Translation Exposure The following tables present an analysis of how the Group’s net revenue and earnings for 2024 and 2023 would have been affected by changes in the exchange rates of the currencies that impact the Group’s revenue, EBIT, and Other Comprehensive Income (OCI)/Equity. Currency risk also arises from purchases and sales in a currency that does not correspond to the functional currency of the company (transaction exposure). At the end of the reporting period, Humbles transaction exposure in foreign currency, expressed in Swedish kronor, was as follows: Sensitivity Analysis - Transaction Exposure The following table presents an analysis of the impact on operating results if the Swedish krona had weakened/strengthened by 10% relative to EUR, GBP, and USD, with all other variables held constant, as a result of gains/losses in currency translation. The accumulated foreign exchange gains and losses recorded in the income statement were: Humble continuously works to minimize currency exposure for major purchases through currency exchange and, when necessary, short-term currency hedging. At the end of the year, the hedges in the Group amounted to non-material amounts. Interest rate risk The Group’s main interest rate risk arises from long-term borrowings. The Group’s main interest rate risk arises through long-term borrowing with variable interest, which exposes the Group to interest rate risk regarding cash flows. The Group does not hedge its interest rate risk regarding future cash flows. 2024%TurnoverEBITOCI/EquityStonger EUR vs SEK 10 1% 1% 0%Weaker EUR vs SEK -10 -1% -1% 0%Stronger GBP vs SEK 10 2% 6% 2%Weaker GBP vs SEK -10 -2% -6% -2%Stronger USD vs SEK 10 0% 0% 0%Weaker USD vs SEK -10 0% 0% 0%Estimated effect on: 2023%TurnoverEBITOCI/EquityStonger EUR vs SEK 10 1% 0% 0%Weaker EUR vs SEK -10 -1% 0% 0%Stronger GBP vs SEK 10 2% 5% 2%Weaker GBP vs SEK-10-2% -5% -2%Stronger USD vs SEK 10 0% 0% 0%Weaker USD vs SEK -10 0% 0% 0%Estimated effect on: Accounts receivables2024-12-312023-12-31EUR 64 70GBP 14 13USD 105 106Total foreign currencies 183 189Accounts payable2024-12-312023-12-31EUR 123 136GBP 5 14USD 134 95Total foreign currencies 262 245 %2024202320242023Stonger EUR vs SEK102%2%-3%-4%Weaker EUR vs SEK-10-2%-2%3%4%Stronger GBP vs SEK100%0%0%0%Weaker GBP vs SEK-100%0%0%0%Stronger USD vs SEK103%3%-4%-3%Weaker USD vs SEK-10-3%-3%4%3%Accounts receivableAccounts payable MSEK2024 2023Exchange rate gains and losses included in other income and expenses1 2Exchange rate losses on borrowing in foreign currency that are included in financial costs-5 -6Total exchange rate gains and losses included in profit before tax - net -4 -3
Page 87
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 87 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT The Group has two term loans totaling MSEK 1,395: MSEK 245, carries a floating interest rate (STIBOR 3m + 3.30%) MSEK 1,150, carries a floating interest rate (STIBOR 3m + 3.50%) Sensitivity Analysis – Interest Rate Risk If the interest rates on borrowings as of December 31, 2024, had been 1 percentage point higher/lower with all other variables held constant, profit before tax for the financial year would have been +/- MSEK 14 (15) lower/higher, mainly as a result of higher/lower interest expenses on borrowings with floating interest rates. b) Credit risk Credit risk primarily arises from cash and cash equivalents. Customer credit risk is mitigated through credit risk assessments, the establishment of credit limits in cases of delayed payments, and through the terms and conditions agreed upon with customers. There is no significant concentration of credit risk related to exposure to individual customers, specific industries, or geographic regions. During 2024, no individual customer accounted for more than 10% of total revenues. Of the Group’s financial assets, trade receivables fall under the expected credit loss impairment model. Trade Receivables The Group has previously financed a portion of its trade receivables through a factoring arrangement (pledged trade receivables) and received cash in return. The credit risk for the pledged receivables remains with Humble. For information regarding these receivables, see section d) Liquidity Risk below. The Group applies the simplified approach for calculating expected credit losses for all trade receivables, whereby the loss allowance is measured based on the credit risk over the entire lifetime of the receivable. To measure expected credit losses, trade receivables have been grouped based on the number of days past due. Expected credit losses are based on a twelve-month period prior to December 31, 2024, and reflect the corresponding historical credit loss experience over the same period. Historical losses are then adjusted to reflect current and forward-looking information on macroeconomic factors that may affect the ability of customers to settle receivables. In cases where the Group has more specific information about individual customers than what is reflected in the statistical model, management makes additional assessments for those customers. Historically, the Group has experienced insignificant credit losses. Based on this historical data, along with a forward-looking assessment, the expected credit losses are not considered material for any customers. An aging analysis of the Group’s trade receivables is presented in Note 21 Accounts Receivables. Trade and other receivables are written off when there is no reasonable expectation of recovery. These assessments are made on a case-by-case basis, considering indicators that there is no reasonable expectation of repayment. Such indicators include, among others, a debtor failing to comply with an agreed repayment plan. Impairments of trade receivables are recognized under other external expenses in operating profit. Subsequent recoveries of amounts previously written off are credited to the same line item. c) Refinancing Risk Refinancing risk is defined as the risk that the Group may experience difficulties in refinancing, be unable to obtain financing, or only be able to do so at increased costs. The risk is mitigated through continuous evaluation of alternative financing solutions by the Group. d) Liquidity Risk Liquidity risk refers to the Group’s risk of being unable to meet its short-term payment obligations due to insufficient cash resources. At the end of the reporting period, the Group held MSEK 432 (401) in cash and cash equivalents. Due to the nature of the Group’s operations, it requires flexible financing with access to committed credit facilities. Group management monitors rolling forecasts of the Group’s liquidity reserve (including unused credit facilities) and cash balances based on expected cash flows, which are monitored at Group level. These analyses are normally carried out by the operating entities, in accordance with the guidelines and limitations established by Group management.
Page 88
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 88 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT In addition, the Group’s liquidity management policy includes forecasting cash flows in major currencies, determining the level of cash required to meet those forecasts, monitoring cash flow trends monitoring cash flow trends against internal and external regulatory requirements and maintaining debt financing plans. At the end of the reporting period, the Group had access to unutilized overdraft facilities amounting to MSEK 31 (58). The overdraft facility is available for use at any time and is contracted until July 2026. The overdraft facilities can be drawn at any time in SEK and, as of the end of the financial year, had an average maturity of 1 year (1). Access to working capital for the Group’s operational activities, as well as financing to meet its investment needs, is a key factor in building a profitable and long-term sustainable business. Humble currently maintains a strong dialogue with investors and banks to manage this risk. Pledged Trade Receivables Some of the Group’s subsidiaries have historically pledged trade receivables as a means of financing operating activities. In connection with invoicing, the receivable is pledged to an external party, which typically advances 70–90% of the invoice amount and disburses the funds immediately upon pledging. The loan accrues interest until the customer has settled the invoice and is recognized on a gross basis as both a trade receivable and a short-term liability to the financing institution in the balance sheet. At the end of the reporting period, there were no pledged trade receivables recognized in the balance sheet (0). Term Loan Humble has two term loans totaling MSEK 1,395 and a revolving credit facility amounting to MSEK 170. The loans carry a floating interest rate based on STIBOR 3M plus a margin that depends on the Group’s leverage ratio. As of the end of the reporting period, the interest margins were 3.30% and 3.50%, respectively. Interest payments are generally made quarterly or at the end of the interest period selected by management for the current term. Repayments on Term Loan A are made quarterly in the amount of MSEK 41 until July 2026. The maturity date for the repayment of Term Loan B of MSEK 1,150, as well as the maturity of the revolving credit facility of MSEK 170, is July 2026. The table above analyses the Group’s financial liabilities based on the time remaining from the balance sheet date to the contractual maturity date. The amounts disclosed in the table represent the contractual, undiscounted cash flows, including interest. Future cash flows denominated in foreign currencies have been calculated based on the exchange rates prevailing at the balance sheet date. MEASUREMENT AND DISCLOSURE OF FAIR VALUE The different levels in the fair value hierarchy are defined as follows: Financial instruments – Level 1 Quoted market prices (unadjusted) in active markets for identical assets or liabilities. Financial instruments – Level 2 Observable data for the asset or liability other than quoted prices included in level 1, either directly (i.e. as price quotations) or indirectly (i.e. derived from price quotations). Financial instruments – Level 3 Where one or more significant inputs are not based on observable market data. The Group’s financial assets measured at fair value through profit or loss comprise Other long-term investments in securities, which are classified as Level 1 in the fair value hierarchy. The Group’s financial liabilities measured at fair value through profit or loss comprise Contingent consideration liabilities, which are classified as Level 3 in the fair value hierarchy. There were no transfers between levels during the year. 202420232024202320242023202420232024202320242023Interest-bearing liabilities3603411,409255141,067001,7831,6621,7661,450Contingent considerations11934917175121700148542139501Other liabilities2053241124821311400342398342Lease liabilities111778860185118197169581425452325Accounts payable679652000000679652679652Total 1,474 1,743 1,626 494 293 1,216 198 170 3,591 3,622 3,434 3,270< 12 months1-2 years2-5 years> 5 yearsFinancial liabilities, MSEKTotalBook value
Page 89
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 89 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT Disclosure of Fair Value – Term Loans As described above in section a) Interest Rate Risk, the Group holds financial instruments in the form of term loans. These are measured at amortized cost, which in all material respects approximates their fair value in the balance sheet. Disclosure of Fair Value – Contingent Consideration The total contingent consideration to be paid is generally conditional upon significant financial performance improvements, typically measured against predetermined EBITDA targets to be achieved by the acquired subsidiary. The payment structure is generally at Humble’s discretion, with the majority expected to be settled in cash, but a portion may also be paid in newly issued shares. This partial settlement in shares reduces the Group’s future cash outflows and may have a positive impact on the Group’s cash flow and long- term net debt. The mechanisms behind the contingent considerations vary across acquisitions, and the Group's obligations extend over a longer time horizon. The provision recognized in the Group’s balance sheet reflects management’s best estimate of the expected future cash outflows. This assessment is made at the subsidiary level and is reviewed regularly. The contingent considerations are measured at fair value and have been discounted using a discount rate of 9.16% (11.02). The parent company holds the majority of the Group’s recognized contingent consideration liabilities. Humble has assessed that there are no material differences in the calculation methods of the various contingent considerations that would justify the use of different discount rates for different subsidiaries. This assessment forms the basis for applying the same discount rate across all contingent considerations per year. Level 3 Fair Value Inputs and Valuation Process The contingent considerations have been calculated based on the nominal value of management’s best estimate of the expected outcome as of the acquisition date. The estimate is based on management’s assessment of the amount likely to be paid, given the terms of the share purchase agreement. The fair value of the contingent considerations is then calculated using a discount rate corresponding to the remaining maturity at each reporting date. During 2024, MSEK -30 (-60) in interest expenses were recognized in financial expenses, related to the cost of contingent considerations. The remaining maturity is presented below. Estimated payments per year, MSEKNominal valueFair value2025 119 1152026 17 152027 6 52028 6 4Total contingent 148 139Contingent consideration, MSEK2024 2023Opening balance January 1 501 780 Acquisition032Payments -323 -320Fair value changes that are reported through profit and loss via operating income -90 -199Fair value changes that are reported through profit and loss via operating expense 25 147Interest expense 30 60Exchange differences -4 -2Ending balance December 31 139 501
Page 90
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 90 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT CAPITAL MANAGEMENT The Group’s objective regarding its capital structure is to safeguard its ability to continue as a going concern, thereby enabling it to continue generating returns for shareholders and benefits for other stakeholders, while maintaining an optimal capital structure to keep the cost of capital low. To maintain or adjust the capital structure, the Group may alter the dividend paid to shareholders, return capital to shareholders, issue new shares, or sell assets to reduce debt. The Group assesses its capital based on the ratio of LTM Adjusted EBITDA pro forma in relation to NIBD (Net Interest-Bearing Debt). Net debt The Group has a strategy of maintaining a balanced capital structure, which includes continuous monitoring of its leverage ratio. The decrease in the net debt ration during 2024 is attributable to refinancing activities. NOTE 5 – SEGMENT INFORMATION AND DISCLOSURE OF REVENUE The Group's chief executive decision-maker is the CEO, who primarily uses Adjusted EBITDA (adjusted operating result before interest, taxes, depreciation, and amortization) to evaluate the performance of the operating segments. The CEO does not track segment assets and liabilities for resource allocation or performance assessment. SEGMENT DESCRIPTION Humble operates in four segments: Future Snacking, Sustainable Care, Quality Nutrition and Nordic Distribution. Future Snacking consists of several food and snack brands with high innovation and the vision to provide cutting-edge, healthier and more sustainable candy products, food and snacks for the everyday consumer. Future Snacking also includes various candy, confectionery and snack producers who manufacture high-quality products for the Group’s various brands. Sustainable Care consists of a wide range of brands, distributors and producers of sustainable personal care and household products. Their categories include skin care, oral care, hair care and hygiene products. The companies in the segment are committed to meeting the growing demand for sustainable and environmentally friendly products and by doing so contribute to a more environmentally friendly planet. Quality Nutrition includes both brands and manufacturers of sports nutrition and ingredients. These subsidiaries are dedicated to providing the highest quality nutritional products and supplements designed to help both athletes and general consumers increase performance and health in their daily lives. Nordic Distribution comprises a network of wholesalers and distributors in the Nordic region. The companies within Nordic Distribution have a deep understanding of local markets and consumer preferences. By leveraging the strengths of these local partners, Humble can offer a comprehensive range of FMCG products that cater to the different preferences in the Nordics. OTHER INFORMATION Humbles subsidiaries are divided into segments based on their primary revenue-generating product portfolio or line of business. There have been no MSEK2024-12-312023-12-31Liability to credit institutions* 1,766 1,494Cash and cash equivalents -432 -401Tax deferral 252 260Short-term investment 0 -27Financial asset -20 -6Net Interest Bearing Debt 1,566 1,320Contingent consideration, net 129 501Net Interest Bearing Debt incl contingent consideration 1,695 1,821LTM Adjusted EBITDA Proforma, excluding leasing604559Leverage to NIBD2.6x 2.4xLeverage to NIBD incl contingent consideration2.8x 3.3x*December 2023 includes the M SEK 43 liabilities directly associated with assets classified as held for sale.
Page 91
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 91 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT mergers of different sub-segments for the accounting periods. Others include the Parent Company’s operations as well as a few administrative subsidiaries that do not have a direct connection to other operating activities. Humble has a result-oriented focus on its operations and does not continuously monitor the segments of assets and liabilities, which is the reason why only the income statement is presented in the table below. SEGMENT ASSETS Non-current assets excluding financial instruments and deferred tax assets, allocated based on the physical location of the asset. There are no individual non-current assets that exceed 10% of total assets for the reporting periods. NET SALES Humble has a global sales network, with the primary net sales occurring within Europe and the United Kingdom. The table presents the distribution of net sales per operating country. None of the other countries contributes more than one percent of the total net sales. There are no individual customers within the Humble whose net sales exceed 10% of the Group’s net sales, nor any individual fixed assets that exceed 10% of total assets for the accounting periods. MSEK20242023Australia 391 386Sweden 3,510 3,467United Kingdom 1,582 1,485Portugal 665 624Denmark 373 351Other countries 194 190Total countries 6,715 6,503Fixed assets not specified by country127 128Total fixed assets 6,842 6,631 MSEK20242023Australia 492 423China 191 193Denmark 101 80Finland 135 108Germany 254 272Norway 327 264Portugal 200 167Sweden 3,665 3,496United Kingdom 1,413 1,166USA 143 126Other countries 785 755Total net sales 7,708 7,050MSEK2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023Gross sales 1,082 1021 2,430 2,219 1,594 1,506 2,821 2,497 59 447,987 7,287Intra-group sales -107 -85 -21 -22 -58 -44 -34 -42 -59 -44-279 -237Net sales 975 936 2,409 2,197 1,536 1,462 2,787 2,455 0 0 7,708 7,050Raw material and consumables -533 -532 -1,522 -1,413 -1,053 -1,030 -2,181 -1,946-5,289 -4,921Gross profit 442 404 887 784 483 432 606 509 2,419 2,129Gross margin, % 45% 43% 37% 36% 31% 30% 22% 21% 31% 30%EBITDA 147 83 308 326 137 166 115 101 -20 -18 688 659Items affecting comparability** -20 16 -7 -44 -3 -29 12 3 26 118 -42Adjusted EBITDA 127 100 302 283 134 137 126 104 6 -7 696 617Adjusted EBITDA in relation to net sales 13% 11% 13% 13% 9% 9% 5% 4% 9% 9%EBITA 112 47 285 298 109 144 87 76 -22 -19 570 547Adjusted EBITA 92 64 278 255 106 114 98 79 4 -7 578 505Adjusted EBITA in relation to net sales 9% 7% 12% 12% 7% 8% 4% 3% 8% 7%EBIT 70 13 183 158 82 115 62 55 -21 -23 376 318Adjusted EBIT 51 29 177 114 78 85 74 58 5 -11 384 276Adjusted EBIT in relation to net sales 5% 3% 7% 5% 5% 6% 3% 2% 5% 4%*Other refers to Parent company and minor administrative entities, **See Note 1 0 Items Affecting Comparability for reconciliation to Profit before tax Other*TotalFuture SnackingSustainable CareQuality NutritionNordic Distribution
Page 92
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 92 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT § Accounting Policies SEGMENT REPORTING The Group’s operations are divided into the following operating segments: Future Snacking Sustainable Care Quality Nutrition Nordic Distribution Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The Group’s chief operating decision-maker is the CEO, who is responsible for the allocation of resources and the assessment of performance in the operating segments. REVENUE RECOGNITION The Group’s revenue streams primarily consist of sales of fast-moving consumer goods (FMCG), including finished products such as healthier food items (e.g., confectionery, snacks, bars, beverages), high-quality sports nutrition products, personal care items, and sustainable home and household products. The Group also generates revenue from the sale of ingredients and other raw materials. Sales are conducted globally through multiple channels, including grocery retailers, distributors, and online platforms. Product Sales to Corporate Customers Revenue from product sales is recognized at the point in time when control of the goods is transferred, which generally occurs upon delivery to the customer (retailer/distributor). Humble’s customers have full discretion over the sales channel, and Humble does not control the end- consumer pricing, which is determined by the customer. There are no outstanding obligations that would affect the customer's acceptance of the products. A receivable is recognized when the goods have been delivered, as this is the point at which the consideration becomes unconditional and the terms of the sale are deemed to be fulfilled (i.e., only the passage of time is required for payment to occur). Revenue from contracts with customers is measured at the transaction price agreed in the contract, which reflects the amount the Group expects to receive for the transfer of goods, net of value-added tax (VAT) and other sales taxes. In determining the transaction price, the Group considers any separate performance obligations and the effects of variable consideration. Generally, the Group’s contracts include only one performance obligation—the delivery of goods. Shipping is not considered a separate performance obligation and is therefore not accounted for separately, but as part of the ordinary sale of goods. The performance obligation is considered fulfilled when the products have been transported to the agreed location or collected by the customer, and the risk of obsolescence or loss has been transferred to the customer. Revenue is recognized when the customer has either accepted the products in accordance with the agreement, the period for objections has lapsed, or the Group has objective evidence that all acceptance criteria have been met. Variable consideration includes discounts and product returns and is recognized as a reduction in revenue based on the amounts the Group expects to receive. Neither discounts nor product returns represent a material portion of total consideration. No significant financing component is deemed to exist at the time of sale, as payment terms range from 30 to 90 days, which is consistent with market practice. While extended payment terms may occasionally occur, they never exceed 12 months, and the transaction price is therefore not adjusted for the effects of a significant financing component.
Page 93
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 93 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 6 – OTHER OPERATING INCOME On April 17, Humble completed the second and final part of the sale of properties structured as sale and leaseback transactions. The right-of-use assets resulting from the sale amounted to MSEK 72, and the lease liabilities to MSEK 73. The new right-of- use assets are intended to be used over periods of 5 and 10 years, respectively. The gain of MSEK 4 (9) relates to the rights transferred to the buyer. NOTE 7 – RENUMERATION TO AUDITORS NOTE 8 – RENUMERATION TO PERSONNEL ETC. MSEK 2024 2023Fx-gains from revaluation of operational items 17 19Received grants from public authorities 6 11Fair value changes on contingent consideration that are reported at fair value through profit and loss 90 199Gain on sale of real eastate 4 9Contingent consideration 11 0Other revenues 12 23Total other operating income 140 262KSEK 2024 2023Audit fees 11,261 12,021 of which BDO9,431 8,976 of which Westlake Clark Ltd - 829 of which Other audit firms 1,830 2,215 Audit related services 2,589 368 of which BDO 2,355 22 of which Westlake Clark Ltd - 196 of which Other audit firms 234 151 Total audit fees 13,850 12,389Average number of employees by countryWomenMenTotalWomenMenTotalAustralia 24 254913 1831Denmark 16 213711 1829Finland 6 17235 1924France 1 230 11Hong Kong 18 153318 1634China 3 8113 912Norway 13 152814 1327Portugal 32 225470 2292Sweden 298 456754252 431683Spain 8 31111 112South Africa 3 142 13South Korea 1 121 12Germany 16 122811 1324United Kingdom 101 6716883 66149USA 2 352 46Total5426681,2104966331,129 20242023 Women Men Total Women Men TotalBoard members 2 4 6 2 3 5CEO and other senior executives055055Total29112810Gender distribution in the group for board members and other senior executives2024-12-312023-12-31
Page 94
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 94 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT GUIDELINES FOR RENUMERATION TO SENIOR MANAGEMENT In order for the company to be able to attract, develop and retain senior executives with relevant experience and competence, it is important that the company has a competitive remuneration package in line with what is attractive for senior executives in various industries. The compensation for the senior executives consists of fixed salaries, short and long-term variable compensation, pensions, and other customary benefits. The total compensation must be market-based and competitive and reflect the employee's performance and responsibilities. The Annual General Meeting resolved to adopt guidelines for remuneration to senior executives. PENSION The Group only has defined pension plans. Pension cost refers to the cost that affected the year's profit. SEVERANCE PAY A mutual notice period of 6 months applies between the company and the CEO. In the event of termination by the company, a severance payment of 6 months' wages is received. The severance pay is not offset against other income. In the event of Salaries, remunerations and social chargesSalaries and other remunerationsSocial chargesPensionsSalaries and other remunerationsSocial chargesPensionsBoard of directors, CEO and other executive management23731962Other employees 588 135 3453812631Total 611 142 37 557 131 3320242023Employee benefits 2024 2023Salaries and other remunerations 611 557Social charges 142 131Pension costs - defined contribution plan3733Total employee benefits 790 7212024, KSEKFixed remunerationVariable remunerationBenefits*PensionsTotalBoard of directors and CEODajana Mirborn, chairman of the board of directors538000538Henrik Patek, director261000261Ola Cronholm, director307000307Pål Bruu, director286000286Sara Berger, director271000271Noel Abdayem, director since 2024-05-22**00000Simon Petrén, Chief Executive Officer5,3202,5105781,4509,858Other executive mangement***9,4802,4151,0321,15114,078Total16,4624,9251,6102,60125,598*Refers to company car and one-time compensation for option premium in accordance with decision of the Annual General M eeting on 22 M ay 2024 ** Not eligible for board renumeration ***Comprises Johan Lennartsson, Noel Abdayem, M arcus Stenkil and Kristoffer Zinn. Out of total renumeration, invoiced fee amount to 5 M SEK.2023, KSEKFixed remunerationVariable remunerationBenefits*PensionsTotalBoard of directors and CEODajana Mirborn, chairman of the board since 2023-05-19 380 0 0 0380Peter Werme, chairman of the board until 2023-05-19 182 0 0 0182Henrik Patek, director 253 0 0 0253Ola Cronholm, director 230 0 0 0230Pål Bruu, director since 2023-05-19 163 0 0 0163Sara Berger, director since 2023-05-19 133 0 0 0133Björn Widegren, director until 2023-05-19 82 0 0 082Hans Skruvfors, director until 2023-05-19 67 0 0 067Simon Petrén, Chief Executive Officer 4,560 4,103 420 1,22610,309Other executive mangement* 8,040 1,491 647 1,06211,240Total14,0905,5941,0682,28823,040*Comprises Johan Lennartsson, Noel Abdayem, M arcus Stenkil and Kristoffer Zinn. Out of total renumeration, invoiced fee amount to 4 M SEK. **Refers to company car and one-time compensation for option premium in accordance with decision of the Annual General M eeting on 1 9 M ay 2023
Page 95
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 95 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT termination by the CEO, no severance pay is payable. A mutual notice period of 6 months applies between the company and other senior executives. There are no agreements on severance pay for other senior executives. VARIABLE RENUMERATION For the CEO, the bonus for the 2024 financial year was partly based on the Group’s profitability measured by EBITA, and partly on individual targets set by the Board of Directors. The bonus amount for 2024 corresponded to 47% (90) of the base salary. INCENTIVE PROGRAM Below is a summary of the warrant programs found in the Group during any of the periods covered by the Annual Report 2024. Warrant Programs At the end of the financial year, the Group had three active incentive programs: Series 2022/2025, Series 2023/2026, and Series 2024/2027. Series 2021/2024 expired during the financial year. Serie 2021/2024 This program was comprised by 1,000,000 warrants, of which 920,000 were allocated and 80,000 were cancelled during 2022. The allocated warrants expired in 2024. Serie 2022/2025 This program comprises a total of 2,400,000 warrants, all of which have been allocated. The program includes 36 employees within the Group, and vesting occurs gradually over the duration of the program. The subscription premium paid for the warrants amounted to SEK 0.49 per warrant and is recognized directly in equity. The option premium has been measured at fair value using the Black & Scholes valuation model. Serie 2023/2026 This program comprises a total of 4,100,000 warrants, all of which have been allocated. The program includes 39 employees within the Group, and vesting occurs gradually over the duration of the program. The subscription premium paid for the warrants amounted to SEK 0.25 per warrant and is recognized directly in equity. The option premium has been measured at fair value using the Black & Scholes valuation model. Serie 2024/2027 This program comprises a total of 6,000,000 warrants, all of which have been allocated. The program includes 36 employees within the Group, and vesting occurs gradually over the duration of the program. The subscription premium paid for the warrants amounted to SEK 0.27 per warrant and is recognized directly in equity. The option premium has been measured at fair value using the Black & Scholes valuation model. During 2024, the Group recognized an expense of MSEK 2 related to this series, as the company has chosen to compensate the employees. Fair Value of Allocated Warrants Warrants have been acquired at market value during 2022, 2023, and 2024. Granted warrants, warranty program serie 2021/20242024 2023As per Januari 1920,000 920,000Granted 0 0Forfeited 0 0Redeemed 0 0Expired -920,000 0Outstanding as of December 31 0 920,000Redeemed as of December 31 0 0 Granted warrants, warranty program serie 2022/20252024 2023As per Januari 12,400,000 2,400,000Granted 0 0Forfeited 0 0Redeemed 0 0Expired 0 0Outstanding as of December 31 2,400,000 2,400,000Redeemed as of December 31 0 0 Granted warrants, warranty program serie 2023/20262024 2023As per Januari 14,100,000 0Granted 0 4,100,000Forfeited 0 0Redeemed 0 0Expired 0 0Outstanding as of December 31 4,100,000 4,100,000Redeemed as of December 31 0 0 Granted warrants, warranty program serie 2024/20272024 2023As per Januari 10 0Granted6,000,0000Forfeited 0 0Redeemed 0 0Expired 0 0Outstanding as of December 31 6,000,000 0Redeemed as of December 31 0 0
Page 96
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 96 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT The market value of the warrants in the 2022/2025, 2023/2026, and 2024/2027 warrant programs has been calculated using the Black & Scholes valuation model. These warrant programs have not resulted in any expense for the Group, as a market-based premium has been paid by the participants. Based on an analysis of historical volatility in the company’s share price and that of comparable companies, the expected volatility over the term of the options has been estimated at 28% (30%). The expected volatility in the share price is based on historical volatility (measured over the remaining term of the option), adjusted for anticipated changes in future volatility based on publicly available information. The inputs used in the model for the allocated options are presented in the table below. §Accounting polices PENSION OBLIGATIONS The Group only has defined contribution pension plans. Contributions are recognized as personnel expenses in the statement of comprehensive income when they become due for payment. WARRANT PROGRAMS The Group has warrant programs. Employees participating in the programs pay a premium corresponding to the fair value of the warrants, calculated using the Black & Scholes valuation model on the grant date. The right to exercise the warrants is conditional upon continued employment throughout the duration of the program. The warrant programs currently in place within the Group are recognized as an increase in both equity and cash and cash equivalents upon subscription and payment of the warrant premium by the participant. NOTE 9 – OTHER OPERATING EXPENSES Serie 2024/2027Serie 2023/2026Serie 2022/2025Serie 2021/2024Redemtion price 14.26 11.38 23.90 35.72Grant date 2024-06-20 2023-06-05 2022-05-25 2021-06-17Expiration date 2027-09-30 2026-09-15 2025-09-15 2024-06-29Share price at grant date 9.51 6.76 15.94 23.82Expected volatility in the company´s share price 28% 30% 30% 45%Expected dividend yield 0% 0% 0% 0%Risk-free interest rate 2.60% 3.04% 1.54% -0.20%Number of outstanding warrants per maturity dateRedemtion priceExpiration date2024-12-312023-12-31Time of allocationWarranties serie 2022/20252021-06-17 35.722024-06-29 0 920,000Warranties serie 2022/20252022-05-25 23.902025-09-15 2,400,000 2,400,000Warranties serie 2023/20262023-06-05 11.382026-09-15 4,100,000 4,100,000Warranties serie 2024/20272024-06-20 14.262027-09-306,000,000 0Total 12,500,000 7,420,000Remaining weighted average contract term of outstanding warrants at the end of the period2.0 years 2.1 yearsMSEK20242023Exchange rate losses from revaluation of items of an operating nature -16 -17Fair value changes on contingent consideration that are reported at fair value through profit and loss-25-147Other operating expenses -14 -11Total other operating expenses -54 -174
Page 97
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 97 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 10 – ITEMS AFFECTING COMPARABILITY Humble presents items affecting comparability with EBITDA to visualize adjusted, comparable figures that exclude items occurring in historical periods for various reasons. Items affecting comparability mainly include the following: Acquisition related cost comprises external expenses due to legal and financial advisors, external consultancy firms and different expertise within detailed questions in the due diligence process. The acquisition related cost is recognized as a loss to the Other external expenses in the Income statement. Revaluation of contingent considerations is recognized as an Other operating income or Other operating expense once the updated assessment is made. Contingent considerations are frequently reassessed based on management’s best estimate of expected future cash- or share payments. Employment-related compensation refers to considerations in the share purchase agreements that the sellers are entitled to a cash bonus if they remain in service after the transaction is completed. These items have a negative cash effect when they are paid, and the effect is reported as a personnel cost in the income statement over the time that the compensation is earned. Employment-related compensation refers to considerations in the share purchase agreements that the sellers are entitled to a cash bonus if they remain in service after the transaction is completed. These items have a negative cash effect when they are paid, and the effect is reported as a personnel cost in the income statement over the time that the compensation is earned. The penalty refers to the part of the share purchase agreements between Humble and the seller that the seller must repay of the purchase price paid to Humble if they leave their services after the transaction. Such risk is reduced by penalties of the fine. If the seller remains in service for the agreed contract term, this item has no cash flow effect. The part of the purchase price that must be repaid if the seller leaves his position constitutes a separate transaction in accordance with IFRS and must therefore not be included as part of the purchase price for the acquired business. Instead, this part is reported as a personnel cost and reported over time as the services are delivered. Restructuring costs primarily relate to completed integrations within the Group and cost-saving initiatives amounting to MSEK 16. Personnel costs during ongoing restructuring processes amounted to MSEK 12. This item also includes gains from sale and leaseback transactions. Capitalized development costs reflect the updated assessment of accounting principles for internally capitalized work. Other costs mainly relate to listing change expenses of MSEK 15. The primary adjustment items for the year were related to the revaluation of contingent considerations amounting to MSEK 65 (51), restructuring costs of MSEK -25 (-23), and employment-related compensation and penalties of MSEK -25 (-45).
Page 98
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 98 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 11 – FINANCIAL INCOME AND FINANCIAL EXPENSES 2024, MSEKFuture SnackingSustainable CareQuality NutritionNordic DistributionOtherTotalAdjusted EBITDA 127 302 134 126 6 696Acqusition related cost 0 -3 0 0 -3 -6Revaluation of contingent considerations accounting* 28 26 13 -3 0 65Lock-in penalty from acquisition SPA* -8 -9 -5 -3 0 -25Restructuring -5 -5 -7 -4 -4 -25Other 4 -3 1 -2 -18 -17EBITDA 147 308 136 115 -19 688Depreciation -35 -24 -28 -28 -2 -117EBITA 112 284 108 87 -21 570Amortization -41 -101 -28 -24 0 -194EBIT 71 183 80 63 -21 376Finance net -22 2 -45 -14 -136 -215 PROFIT AND LOSS AFTER FINANCIAL ITEMS 49 185 35 49 -157 161*These items have no cash flow impact 2023, MSEKFuture SnackingSustainable CareQuality NutritionNordic DistributionOtherTotalAdjusted EBITDA 100 283 137 104 -7 617 Acqusition related cost -3 -3 -1 0 -1 -8Revaluation of contingent considerations accounting* -18 45 26 -1 0 51Lock-in penalty from acquisition SPA* -11 -23 -7 -4 0 -45Restructuring -8 -7 -1 -1 -5 -23Capitalized development costs* 26 34 18 6 -5 79Other -1 -1 -4 -4 0 -12EBITDA 84 326 166 101 -18 659Depreciation -36 -28 -22 -25 -1 -112EBITA 48 299 144 76 -19 547Amortization -34 -141 -29 -21 -4 -229EBIT 14 158 115 55 -23 318Finance net -13 -11 -25 -10 -320 -379 PROFIT AND LOSS AFTER FINANCIAL ITEMS 1 147 90 45 -343 -61*These items have no cash flow impact MSEK 2024 2023EBITDA688659Items affecting comparability 8 -42Adjusted EBITDA 696 617EBITA 570 547Items affecting comparability 8 -42Adjusted EBITA 578 505EBIT 376318Items affecting comparability8-42Adjusted EBIT 384 276MSEK 2024 2023Interest income 8 6Exchange rate differences 3 5Other financial income 2 2Total financial income 13 13Interest expenses related to interest-bearing liabilities -167 -211Interest expenses related to unwinding of discounting effect -30 -60Exchange rate differences -11 -13Other financial expenses -20 -108Total financial expenses -228 -393Net of financial items -215 -380
Page 99
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 99 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 12 – INCOME TAX The Group’s current tax rate is 20.6% (20.6%), and the Group’s effective tax rate amounted to 23% (74%). Of the non-deductible expenses, MSEK -65 (-49) relates to the tax effect of non-deductible interest expenses. Transaction costs recognized in equity resulted in a tax effect of MSEK 0 (6). NOTE 13 – EARNING PER SHARE There was no dilution effect for 2024 due to the average share price being lower than the exercise price of outstanding warrants. For 2023, no dilution effect occurred as the reported result was negative and the average share price was also below the exercise price of outstanding warrants. The number of potential ordinary shares that may result in dilution in the future amounted to 12,500,000 (7,420,000) at the end of the year. § Accounting Polices Earnings per share are calculated by dividing the net profit for the year attributable to the parent company's shareholders by the weighted average number of ordinary shares outstanding during the period. The weighted average number of ordinary shares and potential ordinary shares has been used as the denominator in the calculation of diluted earnings per share in periods where the result is positive. Dilution occurs only when the exercise price is lower than the market price, and the dilution effect increases with the size of the difference. Classification of Securities Warrants allocated to employees under Humble’s warrant programs have been assessed as potential ordinary shares. They are included in the calculation of diluted earnings per share if the performance conditions tied to the warrants—such as total shareholder return—would have been met based on the company’s performance up to the balance sheet date, and to the extent that they have a dilutive effect. The warrants are not included in the calculation of basic earnings per share. Further information about the warrants is provided in Note 8 – Renumeration to personnel, etc. MSEK 2024 2023Current tax -92 -89Deferred tax 55 45Total income tax -37 -45Reconciliation between Swedish income tax rate and effective income taxProfit before tax 161 -61Tax according current tax rate 20,6% (20,6%) -33 13Tax effect from: Effect from other tax rates in foreign subsidiaries 1 -4Non-deductible expenses -36 -51Non-taxable income 26 1Tax attributable to previous year 5 -4Income tax -37 -45Earnings per share before dilution, SEK 2024 2023Earnings attributible to the shareholders of the parent company124,169,070-105,504,496Earnings per share before dilution0.28-0.28Earnings per share after dilution, SEKEarnings attributible to the shareholders of the parent company124,169,070-105,504,496Earnings per share after dilution*0.28-0.28Weighted average number of ordinary sharesWeighted average number of ordinary shares when calculating earnings per share before dilution445,113,429377,360,692Adjustments to calculate earnings per share after dilution: Average number of warrants00Weighted average number of ordinary shares after dilution445,113,429377,360,692
Page 100
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 100 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 14 – INTANGIBLE ASSETS ASSESSMENT OF IMPAIRMENT NEED FOR GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill, trademarks, and other intangible assets represent a significant portion of Humble’s balance sheet. The company performs an annual impairment test of these assets based on discounted future cash flow projections for the cash-generating units (CGUs) in which goodwill, trademarks, and other intangible assets are recognized. The impairment test involves a high degree of judgment and assumptions regarding future cash flows. Forecasts beyond 2025 have been determined by management. The section below outlines how the company has conducted its assessment, including key assumptions and sensitivity analyses. The assumptions considered to have the greatest impact on the impairment test are the terminal growth rate and the discount rate (cost of capital). Other significant assumptions include assessments of future developments in terms of revenue growth, gross margins, overhead cost levels, working capital requirements, and capital expenditure needs. Based on the assumptions made, no impairment requirement has been identified. MSEK 2024 2023 2024 2023 2024 2023Opening balance acquisitions3372097467341,6801,649Purchases291080034Through acquisition of subsidiaries016011021Sales and scrapped assets0-300-3-1Reclassification-3470014Translation differences110211554Accumulated acquisition value 343 337 767 746 1,736 1,680Opening balance depreciations-116-42-332-187-40Sales and scrapped assets030030Depreciations-42-48-147-147-2-2Impairment0-290000Reclassification17000-1-2Translation differences-10-10200Accumulated depreciation -142 -116 -488 -332 -4 -4Closing balance 201 221 279 413 1,732 1,676MSEK 2024 2023 2024 2023 2024 2023Opening balance acquisitions003,7033,6316,4666,223Purchases200034112Through acquisition of subsidiaries000610109Sales and scrapped assets0000-3-4Reclassification33017131724Translation differences0088-21753Accumulated acquisition value 35 0 3,809 3,703 6,690 6,466Opening balance amortization and impairment00-20-453-229Sales and scrapped assets000033Amortization-3000-194-197Impairment000-40-33Reclassification-1600200Translation differences0000-112Accumulated amortization -19 0 -2 -2 -655 -453Closing balance 16 0 3,807 3,702 6,035 6,012 Goodwill Capitalised product development costs Customer relationships Trademarks and brands Software, Licensens & Domains Total
Page 101
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 101 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT Goodwill, trademarks, and other intangible assets with indefinite useful lives are allocated to the Group’s cash-generating units (CGUs), which are identified by operating segment. For these trademarks, there is no foreseeable limit to the period over which they are expected to generate net cash inflows for Humble. The recoverable amount for the CGUs has been determined based on value in use calculations. These calculations are based on estimated future post-tax cash flows derived from the financial budgets for 2025, approved by Group management. Cash flows beyond 2025 are projected based on expected growth rates, gross margins, cost structure, working capital needs, and investment requirements. Cash flows beyond the five-year forecast period are extrapolated using an estimated terminal growth rate, which has been assumed to equal the growth rate in the fifth forecast year and is set at 2% for all operating segments. The applied discount rate for the current and comparative years is presented in the tables below. The same discount rate has been applied to all segments, as the risk exposure is assessed to be consistent across CGUs. The impairment test conducted as of December 31, 2024, shows that the value in use exceeds the carrying amounts for all CGUs. Therefore, Group management has concluded that no impairment is required. The assumptions used in the cash flow projections have been established by Group management and are based on historical experience, the financial history of the segments, and management’s accumulated industry knowledge. For the financial year 2024, actual sales growth and gross margins were in line with management's forecasts. The EBITA margin was slightly lower than forecasted, mainly due to higher selling and marketing expenses and increased personnel costs relative to sales. Despite this deviation, management considers the forecast model to remain a fair representation of expected business performance. Key Assumptions Growth rate Based on product development, sales synergies, and market potential, the company believes that the operating segments have solid potential to stabilize and strengthen their market shares. The expected average annual growth rate varies between segments, with management making individual assessments based on each entity's conditions and market outlook. Sales growth is expected to be positive across all segments during the forecast period, with average growth rates of 14,8% for 2025, 14,4% for 2026, 12,9% for 2027, 10,4% for 2028 and 2,0% for 2029. Gross margins Gross margins are expected to remain stable during the forecast period as planned efficiency improvements and synergies are realized. It is further assumed that gross margins will improve in line with the implementation of cost synergies. The average gross margin is estimated at: 31,4% during 2025, 32,3% during 2026, 32,7% during 2027, 33,2% during 2028 and 33,2% during 2029. The terminal year gross margin is assumed to be the same as in the fifth forecast year, to maintain a conservative approach in the impairment assessment. Operating costs External expenses and personnel costs are expected to remain stable or decline relative to sales across all operating segments. The assumptions regarding operating expenses in relation to net revenue are based on the specific conditions of each company within the segments and are aligned with the strategic initiatives and efficiency targets set by the Group. Sensitivity Analysis A sensitivity analysis has been performed for each cash-generating unit. The results of this analysis are summarized in the table below. The analysis shows that the carrying value of goodwill for all CGUs would still be supported under the assumptions stated in the table. These calculations are hypothetical and should not be interpreted as an indication of the likelihood of changes in these variables. Management assesses that if negative deviations occur across multiple parameters simultaneously, an impairment requirement may arise, as the expected cash flows for the operating segments would be negatively affected to the extent that the value in use would fall below the carrying amounts for all segments. These calculations do not take into account potential actions or management responses that might be implemented should actual cash flows
Page 102
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 102 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT deviate negatively from the forecasted figures. The sensitivity analysis should therefore be interpreted with caution. Group management considers the discount rate, terminal growth rate, and EBITA margin to be the most critical assumptions in the impairment assessment. Accordingly, no separate sensitivity analysis has been performed for other individual assumptions such as revenue growth, gross margins, or operating expenses. However, management assesses that if negative deviations occur across multiple parameters simultaneously, it is likely that there would be an indication of impairment, as the expected cash flows for the operating segments would be negatively affected to the extent that the value in use would fall below the carrying amounts for all segments. CGUEnterprise ValueOperating CapitalHeadroomSustainable Care5,9713,8942,076Future Snacking3,0191,5371,483Quality Nutrition2,3066491,657Nordic Distribution2,0152441,770Total13,3116,3246,986Sustainable CareFuture SnackingQuality NutritionNordic DistributionPotential need of write-down in the event of an increase in the discount rate after tax by 1 percentage pointNo No No NoPotential need of write-down in the event of an decrease in the EBITA margin by 2 percentage point during the forecast period and the period beyond the forecast periodNo No No NoPotential need of write-down in the event of a contemporaneous reduction in the growth rate to extrapolate cash flow beyong the forecast period by 1 percentage point and an increase in the discount rate after tax by one percentage pointNo No No No2024 2023 2024 2023 2024 2023Sustainable Care9.16%10.26%5 år5 år2.00%2.00%Future Snacking9.16%9.93%5 år5 år2.00%2.00%Quality Nutrition9.16%9.76%5 år5 år2.00%2.00%Nordic Distribution9.16%9.69%5 år5 år2.00%2.00%Discount rate after taxNumber of years for cash flow forecastGrowth rate for extrapolation of cash flowMSEK 2024 2023 2024 2023 2024 2023Sustainable Care2,4972,4071,0671,027147224Future Snacking6716613893864363Quality Nutrition4394332342216989Nordic Distribution20020140422037Outgoing balance 3,807 3,702 1,732 1,676 279 413Goodwill Trademarks and brands Customer relationships
Page 103
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 103 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT § Accounting policies GOODWILL Goodwill arises on the acquisition of subsidiaries and refers to the amount by which the consideration transferred exceeds the fair value of the net identifiable assets acquired. For the purpose of impairment testing, goodwill acquired in a business combination is allocated to the cash-generating units (CGUs) or groups of CGUs that are expected to benefit from the synergies of the acquisition. Each unit or group of units to which goodwill has been allocated represents the lowest level within the Group at which the goodwill is monitored for internal management purposes. Goodwill is monitored at the operating segment level. TRADEMARKS Trademarks acquired in connection with business combinations are classified as intangible non- current assets and are recognized at cost less accumulated impairment losses. The initial valuation of trademarks is performed using the "Relief from Royalty" method to determine the asset’s value in use. Trademarks acquired through a business combination are recognized at fair value on the acquisition date and are considered to have an indefinite useful life. As such, they are subject to annual impairment testing to ensure that the carrying amount does not exceed the recoverable amount. SOFTWARE, LICENSES & DOMAINS Software, licenses, and domains have a definite useful life and are recognized at cost less accumulated amortization and impairment losses. The estimated useful life is 5–10 years, which corresponds to the period during which these assets are expected to generate cash flows. CUSTOMER RELATIONS Customer relationships acquired through business combinations are classified as intangible non- current assets and are recognized at cost less accumulated amortization and impairment losses. The initial valuation is determined using a Multi- Period Excess Earnings Method (MEEM), which estimates the expected economic surplus from the acquired customer base, adjusted for natural attrition over time based on customer loyalty and other customer-specific behaviors. Customer relationships acquired in a business combination are recognized at fair value on the acquisition date. These assets are considered to have a definite useful life of between 2 and 8 years, primarily influenced by estimated customer loyalty and purchasing frequency. CAPITALIZED DEVELOPMENT EXPENDITURES Capitalized development expenditures and similar items mainly consist of expenditures related to the development of products sold by the Group. The Group continuously assesses whether internally generated intangible assets, such as capitalized development costs, meet the criteria for capitalization. The following criteria must be fulfilled for internally generated intangible assets to be capitalized: It is technically feasible to complete the asset so that it can be used The Group intends to complete the asset and use or sell it The asset can be used or sold It can be demonstrated how the asset will generate probable future economic benefits Adequate technical, financial, and other resources are available to complete the development and to use or sell the asset; and The expenditure attributable to the asset during its development can be reliably measured. Directly attributable expenses that are capitalized as part of development projects include costs for direct salaries including social security contributions, raw materials and supplies, and other external expenses that can be directly linked to the development of new ingredients or consumer products. Capitalized development expenditures recognized as intangible assets are amortized on a straight-line basis over the estimated useful life, starting from the date the asset is ready for use. The estimated useful life is 3 to 5 years. OTHER INTANGIBLE ASSETS Other intangible assets consist of concessions and advance payments related to intangible rights. These assets have a definite useful life and are recognized at cost less accumulated amortization and impairment losses. The estimated useful life is 5 years, which corresponds to the period during which the assets are expected to generate cash flows.
Page 104
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 104 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT IMPAIRMENT OF NON-FINANCIAL ASSETS Goodwill with an indefinite useful life, trademarks, and intangible assets not yet ready for use are not amortized on a regular basis. Instead, they are tested annually for impairment, or more frequently if there is an indication that the asset may be impaired. Assets that are subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. If such an indication exists, the asset's recoverable amount is calculated. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of fair value less costs of disposal and value in use. Value in use is calculated as the present value of estimated future cash flows expected to arise from the asset’s continued use in operations and from its disposal at the end of its useful life. The discount rate applied is pre-tax and reflects current market assessments of the time value of money and the risks specific to the asset. For assets (excluding goodwill) that have previously been impaired, an assessment is made at each reporting date to determine whether a reversal of the impairment loss is necessary. When testing for impairment, assets are grouped into the smallest possible cash-generating units. A cash-generating unit is a group of assets with substantially independent cash flows. As a result, some assets are tested for impairment individually and some are tested at the cash-generating unit level. Goodwill is allocated to the Group's operating segments, which are the lowest cash-generating units expected to benefit from synergies from business combinations. The operating segments also represent the lowest level in the Group where the CEO and management monitor goodwill.
Page 105
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 105 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 15 – TANGIBLE ASSETS § Accounting policies Property, plant and equipment mainly consist of buildings and land as well as machinery. Depreciation is calculated to allocate the cost of assets to their residual values over their estimated useful lives using the straight-line method as follows: Buildings 30–50 yrs Machinery and equipment 5 yrs Equipment, tools and installations 3–5 yrs Constructions in progress 3–5 yrs Assets that meet the criteria to be classified as non-current assets held for sale are presented as current assets in the balance sheet and are measured at the lower of the carrying amount and fair value less costs to sell. Depreciation on these assets ceases upon classification as held for sale. MSEK 2024 2023 2024 2023 2024 2023Opening balance acquisitions45248118926844Purchases15024182625Through acquisition of subsidiaries0250007Sales and scrapped assets-18-107-6-3-15-4Reclassification001213-81Assets held for sale0-121000-4Translation differences103-210Accumulated acquisition value 42 45 151 118 71 68Opening balance depreciations-5-10-35-13-14-8Sales and scrapped assets413197Depreciations-1-4-20-25-14-14Reclassification00-10-1-1Assets held for sale090002Translation differences00-22-10Accumulated depreciation -2 -5 -55 -35 -22 -14Closing balance 40 40 97 83 50 54MSEK 2024 2023 2024 2023 2024 2023Opening balance acquisitions1291013253405Purchases11159513549Through acquisition of subsidiaries 0 0 0 0 0 32Sales and scrapped assets00-33-43-111Reclassification42-9-1105Assets held for sale0-1000-126Translation differences10005-2Accumulated acquisition value 27 12 58 10 349 253Opening balance depreciations-4-3-30-61-33Sales and scrapped assets000-2167Depreciations-3-20-1-38-47Reclassification00100-1Assets held for sale0000011Translation differences0000-42Accumulated depreciation -7 -4 -2 -3 -87 -61Closing balance 19 7 56 7 262 192 Equipment, tools and installationsMachines and other technical equipmentBuildings and land Ongoing new facilities and advancesLeasehold improvementsTotal
Page 106
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 106 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 16 – LEASE AGREEMENT In 2024, the second part of the property sale was completed through a sale and leaseback transaction. The acquisition cost of the newly recognized right-of-use assets from the transaction amounted to MSEK 72. For more information about the property sale, see Note 6 Other Operating Income. Total cash flow related to lease agreements amounted to MSEK -96 (-72). For information regarding the maturity of lease liabilities, see Note 4 Financial Risk Management. § Accounting policies The Group acts as a lessee. The Group’s lease agreements primarily relate to properties, premises, vehicles, machinery, and office equipment. Leases are typically entered into for fixed periods of between 12 months and 5 years, although options to extend or terminate leases exist, particularly for properties and premises. When determining the lease term, management considers all available information that provides an economic incentive to exercise an extension option or a termination option. Extension or termination options are only included in the lease term if it is reasonably certain that the lease will be extended or terminated. MSEK 2024 2023 2024 2023 2024 2023 Opening balance acquisitions 332 169 25 16 36 28 Additional right of use 121 179 12 14 20 10 Amended and restated agreements 23 13 0 1 1 1 Terminated -30 -26 -7 -7 -4 -3 Translation differences 2 -3 0 0 0 0 Accumulated acquisition value 448 332 30 25 54 36 Opening balance depreciations -70 -49 -10 -7 -15 -8 Depreciations -56 -46 -10 -9 -11 -9 Terminated 29 25 6 5 2 2 Translation differences -1 0 0 0 0 0 Accumulated depreciation -97 -70 -14 -10 -23 -15 Closing balance 351 262 16 15 31 21 MSEK 2024 2023 2024 2023 Opening balance acquisitions 2 3 394 215 Additional right of use 22 1 177 204 Amended and restated agreements 0 0 24 16 Terminated -1 -2 -42 -37 Translation differences 0 0 3 -3 Accumulated acquisition value 23 2 556 394 Opening balance depreciations -1 -1 -96 -65 Depreciations -2 -1 -79 -64 Terminated 1 1 38 33 Translation differences 0 0 -1 1 Accumulated depreciation -2 -1 -137 -96 Closing balance 21 1 419 299 Buildings Vehicles Machines Other Total Other leasing costs, MSEK 2024 2023Interest costs (included in Financial costs)-24-10Expenses attributable to short-term leasing agreements (included in Other external costs)-3-1Expenses attributable to leases for which the underlying asset is of low value that are not short-term leases (included in Other external costs)-6 -2Total other leasing costs -32 -12 Lease liabilities, MSEK 2024-12-31 2023-12-31Current 95 67Non-current 357 258Total lease liabilities 452 325
Page 107
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 107 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT The Group’s lease agreements may include both lease and non-lease components. The Group does not separate the consideration in the contract between lease and non-lease components (such as associated repair, maintenance, or administrative costs). This accounting policy is applied consistently across all asset categories within the Group. Lease payments are discounted using the interest rate implicit in the lease. If this rate cannot be readily determined—which is typically the case for the Group, except for vehicles—the Group applies its incremental borrowing rate. The incremental borrowing rate is determined with consideration of the lease term, the economic environment in which the Group operates, the type of asset being leased, and the Group’s credit rating. Lease payments are allocated between the repayment of the lease liability and interest. The interest expense is charged to the income statement over the lease term to produce a constant periodic rate of interest on the remaining balance of the lease liability. The Group applies the exemption under IFRS 16 for short-term leases and leases for which the underlying asset is of low value. Payments for such leases are not recognized as right-of-use assets and lease liabilities but are instead expensed on a straight-line basis over the lease term. The Group has lease agreements arising from sale and leaseback transactions in which an asset is sold to a buyer and then leased back. The right-of- use asset is measured as the portion of the previously recognized carrying amount of the asset that relates to the right-of-use retained by the Group. Any gain or loss is recognized for the rights transferred to the buyer. NOTE 17 – DEFERRED TAX Deferred tax assets are recognized for tax loss carryforwards or other deductions to the extent that it is probable they can be utilized against future taxable profits. Unutilized tax loss carryforwards for which no deferred tax asset has been recognized as of December 31, 2024, amount to MSEK 3 (10). Deferred tax related to unutilized tax loss carryforwards as of December 31, 2024, amounts to MSEK 30 (24). The tax loss carryforwards do not expire. Deferred tax liability attributable to 2024 2023 2024 2023 2024 2023Opening balance349344781061320Additional deferred tax on acquisition of subsidiaries 0 4 0202Sale of real estates 0 0 00-11-8Reported in the incomestatement00-30-3000Translation differences 8 1 3 0 1 0Closing carrying value deferred tax liability 357 349 52 78 3 132024 2023 2024 2023 2024 2023Opening balance33316632540533Additional deferred tax on acquisition of subsidiaries 0 3 0 0 0 12Sale of real estates 0 0 0 0 -11 -8Reported in the incomestatement-6-22534-102Translation differences 0 0 0 0 12 1Closing carrying value deferred tax liability 27 33 92 66 530 540Deferred tax assets attributable to202420232024202320242023Opening balance242572329557Additional deferred tax on acquisition of subsidiaries 0 0 0 0 0 0Reported in the incomestatement6-127393338Translation differences 0 0 0 0 0 0Closing carrying value deferred tax asset 30 24 98 72 129 95 Right of use assetsDeferred tax liability attributable toUntaxed reservesCustomer relationshipsBuildings Tax loss deductionsLeasing liability Trademark TotalTotal
Page 108
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 108 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT The unutilized tax loss carryforwards primarily relate to historical losses incurred by Humble Group AB during the years 2009–2020. § Accounting policies Deferred tax assets are recognized to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilized. This assessment is performed on an ongoing basis. NOTE 18 – EQUITY IN ASSOCIATED COMPANIES AND JOINT VENTURES Within Humble, there is one holding classified as a joint venture—Amerpharma Sp.z.o.o., partly owned by Humble Group AB—and one associate— Snacksmack AB, partly owned by Grahns Konfektyr AB. The share of profit from associates and joint ventures amounted to MSEK 0 (1). Both the associate and the joint venture are considered individually immaterial to the Group. For more information regarding the parent company’s holdings, see Note 49 Shares in Associates and Joint Ventures. NOTE 19 – OTHER LONG-TERM SECURITIES HOLDINGS AND OTHER LONG-TERM RECEIVABLES Of the additions in 2023, MSEK 27 related to listed shares in Tingsvalvet Fastighets AB, which were received as part of the contingent consideration in connection with the property sale. These shares were sold during 2024 and are recognized as MSEK -27 under disposals. NOTE 20 – INVENTORY § Accounting policies Inventories are measured at the lower of cost and net realizable value. Cost includes direct material costs, direct labor, and attributable indirect manufacturing costs (based on normal production capacity). Borrowing costs are not included. The cost of individual inventory items is allocated using the weighted average cost method. The cost of goods for resale is determined after deductions for discounts. Net realizable value is the estimated selling price in the ordinary course of business, less applicable variable selling expenses. Deferred tax - net2024-12-312023-12-31Deferred tax assets12995Amount offset against deferred tax liabilities-92 -66Closing carrying value deferred tax liability37 29Deferred tax liability530541Amount offset against deferred tax assets-92 -66Closing carrying value deferred tax asset439 474 MSEK 2024 2023 2024 2023 2024 2023Opening balance 33 14 15 16 49 30Additional items2270-1226Additional loan to associated companies00140140Deductions -27 -7 0 0 -27 -7Closing balance 8 33 29 15 38 49Other long-term securities holdingsOther long-term receivablesTotal MSEK2024-12-312023-12-31Raw materials and necessities 99 102Finished goods and goods for resale1,061 838Total inventory 1,160 940
Page 109
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 109 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOT 21 – ACCOUNTS RECEIVABLES The Group applies the simplified approach for calculating expected credit losses for all trade receivables, where the provision is based on the credit risk over the entire lifetime of the receivable. Historically, the Group has experienced insignificant credit losses. Based on historical data and a forward-looking assessment, future credit losses are not expected to be material for any individual customer or in aggregate. Therefore, no general provision for future credit losses is recognized at the Group level. Instead, provisions for expected credit losses are assessed and recognized by each subsidiary individually. For further information regarding the provision for expected credit losses, see Note 3 Significant Accounting Estimates and Judgments and Note 4 Financial Risk Management. § Accounting policies The Group has two categories of trade receivables: Pledged trade receivables Other trade receivables Trade receivables represent amounts owed by customers for goods sold or services rendered in the ordinary course of business and are classified as current assets. Trade receivables are initially recognized at fair value (transaction price). Receivables pledged by the Group are recognized in full as an asset on the balance sheet, while a corresponding short-term liability is recognized on the liabilities side for the portion that has been pledged. At the end of the financial year, there were no pledged trade receivables recognized in the balance sheet. NOTE 22 – OTHER SHORT-TERM RECEIVABLES NOT 23 – PREPAID EXPENSES AND ACCRUED INCOME MSEK2024-12-31 2023-12-31Accounts receivables604566Expected credit loss-5-5Total accounts receivables599561Age analysis of accounts receivables2024-12-31 2023-12-31Non-overdue482435Overdue 0 - 30 days8277Overdue 31 - 90 days1922Overdue 91 - 180 days816Overdue 181 - 360 days15Overdue > 360 days77Total accounts receivables599561MSEK2024-12-312023-12-31Current receivables for taxes and fees 97 43Receivables with suppliers 10 15Receivables with suppliers 9 9Other receivables 43 30Total other receivables 160 97MSEK2024-12-312023-12-31Advances to suppliers6657Accrued revenues 7 17Prepaid insurance fees 4 3Prepaid license- and software fees 5 3Prepaid sales provision and consultant provision 15 1Prepaid lock-in penalty from aquisition SPA 14 37Other items 40 38Total prepaid expenses and accrud income 152 157
Page 110
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 110 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOT 24 – LIQUID FUNDS During 2024, the Parent Company increased its overdraft facility to MSEK 225 (150). The revolving credit facility runs over the term of the loan agreement and matures in July 2026. As of the balance sheet date, MSEK 150 of the total facility was subject to restrictions. These restrictions were lifted during the first quarter of 2025. For further details, see Note 26 Interest-Bearing Liabilities. The credit facility is subject to two financial covenants: a) Net interest-bearing debt (after deduction of cash and cash equivalents) in relation to Adjusted EBITDA Pro Forma must not exceed 3.5x through March 31, 2024; 3.25x through March 31, 2025; and 3.0x from June 30, 2025, until the maturity of the loan agreement. b) EBITDA in relation to net financial items must not be less than 4x during the term of the loan. There are no other overdraft facilities in the Group as of the end of the financial year. NOTE 25 – FINANCIAL INSTRUMENT PER CLASSIFICATION § Accounting policies The Group’s financial instruments include the following items: Other non-current receivables, Other non-current investments in securities, Trade receivables, Other receivables, Cash and cash equivalents, Interest-bearing liabilities (both current and non-current), Other liabilities (both current and non-current), Trade payables, and Contingent considerations. The carrying amount of the Group’s non-current financial instruments measured at amortized cost essentially corresponds to their fair value, as the interest rates are in line with current market rates. The carrying amount of the Group’s current financial instruments measured at amortized cost also essentially corresponds to their fair value, as the discounting effect is not material. MSEK2024-12-312023-12-31Cash at bank 432 401Short term placements00Total available cash and cash equivalent 432 401Negotiatied revolving credit facility 225 150whereof used amount at end of the year 194 92whereof available amount at end of the year 31 58 Financial assets at carrying value2024-12-312023-12-31Other long-term receivables 29 15Accounts receivables 599 561Other short-term receivables 160 97Accrued income 7 17Cash and cash equivalents 432 401Total 1,227 1,091Financial assets measured at fair value through profit and lossOther long-term securities holdings 8 33Total 8 33Financial liability at carrying value2024-12-312023-12-31Interest-bearing liabilities (short- and long-term) 1,766 1,450Other liabilities (short- and long-term) 398 342Accounts payable 679 652Accrued expenses* 97 62Total 2,9402,506Financial liabilities measured at fair value through profit and lossContingent considerations (short- and long-term) 139 501Total 139 501
Page 111
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 111 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT Classification and Measurement of Financial Assets The Group classifies and measures all financial assets at amortized cost, except for other non- current investments in securities, which are measured at fair value through profit or loss. Assets that are held for the purpose of collecting contractual cash flows and where those cash flows consist solely of principal and interest are measured at amortized cost. The carrying amount of these assets is adjusted for any expected credit losses that have been recognized (see “Impairment of Financial Assets” below). Interest income from these financial assets is recognized using the effective interest method and is included in financial income. Classification and Measurement of Financial Liabilities Contingent considerations are measured at fair value through profit or loss, and changes in fair value (which are reassessed each period) are recognized in the income statement under “Other operating income” or “Other operating expenses,” respectively. In cases where contingent considerations are due over a period longer than 12 months, they are recognized at their discounted present value. The contingent consideration is based on the nominal amount of management’s best estimate of the expected outcome as of the acquisition date. The estimate is based on what management deems likely to be paid, given the terms of the share purchase agreement. The fair value of contingent consideration is then calculated using a discount rate corresponding to the remaining term until payment at each reporting date. All interest-related charges are recognized in the income statement and are included in “Financial expenses” or “Financial income.” Impairment The Group assesses expected credit losses related to investments in debt instruments measured at amortized cost using forward-looking information. The Group selects the impairment model based on whether there has been a significant increase in credit risk. In accordance with the simplified approach under IFRS 9, the Group applies an impairment model to trade receivables whereby the provision for expected credit losses is measured based on the lifetime expected loss and is recognized at the time the receivable is initially recognized. NOTE 26 – INTEREST-BEARING LIABILITIES LIABILITIES TO CREDIT INSTITUTIONS Humble’s credit facility comprises two term loans of MSEK 245 and MSEK 1,150 (of which MSEK 150 was subject to restrictions that were lifted in the first quarter of 2025), a revolving credit facility of MSEK 170, and an overdraft facility of MSEK 225. The credit facility has a duration of 3 years from the signing of the loan agreement and matures in July 2026. The loans carry interest based on STIBOR 3M plus a margin that depends on the company’s leverage ratio at the end of the previous quarter. The interest base (STIBOR 3M) is fixed two days before the start of each new interest period. For the term loans, the interest period is three months. For the revolving credit facility, Humble has the option to select the length of the interest periods, with a minimum of one month and a maximum of six months. MSEK2024-12-312023-12-31Long-term liabilitiesCredit facility, long-term part 1,222 1,088Revolving credit facility 170 101Liabilities to credit institutions 14 8Total long-term liabilities 1,406 1,197Short-term liabilitiesCredit facility, short-term part 164 161Cash pool 193 92Other liabilities to credit institutions 3 0Total short-term liabilities 360 253Total interest-bearing expenses 1,766 1,450
Page 112
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 112 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT The MSEK 225 overdraft facility is held with SEB and forms the basis of the Group’s cash pool structure. For additional information regarding the overdraft facility, see Note 24 Liquid funds. The Parent Company’s borrowings are denominated in SEK, and the carrying amount essentially corresponds to the fair value of the borrowings, either because the interest rates are in line with current market rates or because the borrowings are short-term in nature. For liabilities to credit institutions, collateral has been provided in the form of shares in subsidiaries with a total value of MSEK 5,317 (5,339). For further information, see Note 30 Pledged Assets and Contingent Liabilities. Property-related loans are presented as liabilities directly associated with assets classified as held for sale. See Note 35 Assets Held for Sale. FINANCIAL COVENANTS The Parent Company’s borrowings are subject to covenants that must be fulfilled, specifically: a) Net interest-bearing debt (after deduction of cash and cash equivalents) in relation to Adjusted EBITDA Pro Forma must not exceed 3.5x through March 31, 2024; 3.25x through March 31, 2025; and 3.0x from June 30, 2025, until the loan agreement matures; and b) EBITDA in relation to net financial expenses must not fall below 4x during the term of the loan. The Parent Company was in compliance with all loan covenants during 2024. NOTE 27 – PROVISIONS The change in provisions for the year relates to the payment of a VAT liability in Fancystage, which pertains to previous years. As of December 31, 2023, the Group had a receivable from the former owner corresponding to the same amount, which is recognized as Other current receivable. During 2024, the provision for other taxes was also settled. NOTE 28 - OTHER LIABILITIES AND CONTINGENT CONSIDERATIONS The Group was granted a 36-month installment plan for the deferred tax payments, with payments beginning in March 2025. As a result, the liability has been classified as both current and non-current. MSEK2024-12-312023-12-31Opening balance 17 8Provision for other taxes -8 0Provision for VAT -9 9Other provisions 0 0Closing carrying value 0 17MSEK2024-12-312023-12-31Long-term liabilitiesDeferred considerations from acquisitions 24 165Non-interest bearing liabilities to previous owner from acquistions 0 11Tax deferrals 168 0Other liabilities 25 6Total other liabilities, long-term 217 182Short-term liabilitiesDeferred considerations from acquisitions 115 336Non-interest bearing liabilities to previous owner from acquistions 13 11Tax deferrals 84 260Other liabilities 108 53Total other liabilities, short-term 320 660Total other liabilities 537 843
Page 113
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 113 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 29 – ACCRUED EXPENSES AND PREPAID INCOME NOTE 30 – PLEDGED ASSETS AND CONTINGENT LIABILITIES There are no contingent liabilities such as ongoing disputes or guarantee commitments in the Parent Company or any of the Group’s subsidiaries at the end of the financial year NOTE 31 – BUSINESS COMBINATIONS No new acquisitions were made during 2024. In the first quarter of 2023, the Parent Company acquired 100% of the shares in four subsidiaries. The acquisitions are presented on an aggregated basis, as the relative amounts of the individual acquisitions are not considered material. The acquired subsidiaries operate within distribution and manufacturing. The identified excess values relate to: Goodwill MSEK 61, Customer Relations MSEK 11, Trademarks MSEK 21, Buildings and land MSEK 9 and deferred tax liabilities MSEK 8. Goodwill Goodwill is attributable to the value of existing know-how and organizational capability to develop and produce future successful assets, as well as synergies expected from integration within Humble. None of the recognized goodwill is expected to be tax-deductible. Significant Estimates: Contingent Consideration Two of the acquisitions made in 2023 include agreements on contingent consideration totaling MSEK 32. These contingent payments are due within 0–2 years. MSEK2024-12-31 2023-12-31Accrued holiday pay, incl social fees 57 60Accrued salaries 10 6Prepaid income 0 0Accrued tantiem & salary bonus, incl social fees 33 23Accrued sales provisions, customer bonuses and consultancy fees 38 27Accrued cost for audit and accounting services 5 5Accrued interst expense 7 5Other accrued items 47 26Total accrued expenses and prepaid income198152MSEK2024-12-312023-12-31Regarding liabilities to credit institutionsShares in subsidiaries in favor to creditfacilities 5,384 5,227Company mortgage 146 222Assets pledged provided for Group Companies 40 0In favor for factoring of accounts receivables 0 9Restricted funds 152 1Property mortgage 4 20Total pledged assets 5,725 5,478Subsidiary Acquisition dateShares and votesSegment Vertical CountryNapame Holding AB2023-03-01 100% Nordic Distribution Manufacturing SwedenAktiebolaget Cool & Candy AB2023-03-15 100% Quality Nutrition Distribution SwedenSkövde Snabbgross AB2023-03-15 100% Future Snacking Distribution SwedenPrivab Grossisterna AB2023-03-15 100% Future Snacking Distribution Sweden
Page 114
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 114 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT SUMMARY OF DISTRIBUTION OF PURCHASE PRICE, PPA – IFRS The maximum nominal amount payable under the agreement amounts to MSEK 39, based on accumulated EBITDA. The fair value of the contingent consideration was MSEK 32 at the acquisition date, calculated by discounting the expected future cash flows. The calculation is based on a discount rate of 11.02%. Employment-Related Compensation No stay-on bonuses or penalty clauses were associated with the acquisitions completed in 2023. Revenue and Profit from Acquired Operations The acquisitions contributed net sales of MSEK 473 to the Group from each respective acquisition date through the end of 2023. The subsidiaries also contributed EBITDA of MSEK 22 during the same period. Had the subsidiaries been consolidated as of January 1, 2023, the Group’s income statement would have included an additional MSEK 83 in net sales and MSEK 4 in EBITDA. Acquisition-Related Costs Acquisition-related costs of MSEK 3 are included in the Group’s statement of comprehensive income and classified as operating activities in the statement of cash flows. § Accounting Polices The acquisition method is applied for accounting of the Group’s business combinations. The purchase consideration for the acquisition of a subsidiary consists of the fair value of assets transferred, liabilities incurred to former owners, shares issued by the Group, and any assets or liabilities arising from contingent consideration arrangements. Identifiable acquired assets, assumed liabilities, and assumed contingent liabilities in a business combination are initially measured at their fair values on the acquisition date. Any portion of the purchase consideration that is conditional upon the continued employment of key personnel is separated from the purchase price and recognized as personnel expenses in the Group’s income statement. In cases where all or part of the consideration is deferred, the future payments are discounted to present value at the acquisition date. The discount rate is the Group’s average cost of capital, representing the rate the Group would pay to finance a similar liability under similar terms and over a comparable period. The interest component is recognized over time as a financial expense in the Group’s net financial items. Contingent consideration is classified either as equity or as a financial liability. Amounts classified as financial liabilities are remeasured at fair value at each reporting date. Any gains or losses arising from remeasurement are recognized in the income statement under “Other operating income” or “Other operating expenses.” See also Note 3 Significant Accounting Estimates and Judgments. Total acquisition2023-12-31Goodwill61Customer relationships and listings11Trademarks and brands21Other fixed assets48Total fixed assets141Inventory39Accounts receivable27Liquid funds20Other current receivables10Total current assets95Total asset236Deferred taxes12Total long term liabilities11Accounts payable41Other current liabilities26Total current liabilities67Total liabilities90Net assets146Cash75Share issue40Contingent consideration32Deferred payment 0Total purchase price146
Page 115
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 115 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 32 – RELATED PARTY DISCLOSURES The ultimate parent company of the Group is Humble Group AB. Related parties include all subsidiaries within the Group as well as key management personnel and their close family members. Transactions with related parties are conducted on an arm’s length basis and at market terms. For disclosures regarding remuneration to the CEO, the Board of Directors, and other senior executives, see Note 8 Remuneration to personnel etc. For information on holdings in subsidiaries, see Note 48 Shares in subsidiaries. No related party transactions were carried out during 2024 that had a material impact. Minor transactions during the year relate to lease agreements for properties owned by former shareholders. These lease agreements are based on the arm’s length principle and reflect market-based terms. For details on the Parent Company’s related party transactions, see Note 60 Related Party Disclosure. NOTE 33 – ADJUSTMENT FOR NON-CASH ITEMS FROM OPERATING ACTIVITES NOTE 34 – CHANGES IN LIABILITIES BELONGING TO FINANCING ACTIVITES Parts of the “Other” line item in 2023 under Liabilities to Credit Institutions relate to property loans that were reclassified to “Liabilities directly associated with assets held for sale.” The same adjustment is reflected under “Cash flows from financing activities” in 2024. The “Other” line item in 2024 pertains to the reclassification of loans in foreign subsidiaries, which had no cash flow impact. The “Other” component related to lease liabilities includes terminated contracts, interest, and foreign exchange translation differences. MSEK2024 2023Interest received (interest allocated to financing activities) 144 206 Interest expense (paid interest allocated to financing activities)-8 0Effect from revaluation of contingent considerations -65 -51Non realised interest on contingent considerations 30 60One-off due to refinancing 0 81Interest expense related to leasing 24 10Other 11 0Effect from exchange rates 0 -3Total adjustment items 136 304MSEK Bond loan Lease liabilityLiabilities to credit institutionsOpening balance January 1, 2023 1,826 150 669Cash flow from financing activities -1,800 -72 723Acquisition 0 22 0New lease agreement 0 222 0Other -26 3 59Closing balance December 31, 202303251,450Cash flow from financing activities 0 -96 305Acquisition 0 0 0New lease agreement 0 201 0Other 0 22 11Closing balance December 31, 202404521,766
Page 116
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 116 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 35 – ASSETS HELD FOR SALE On December 1, 2023, Humble announced its intention to sell ten properties through a sale and leaseback transaction. The first part of the sale was completed on December 15. As a result, a right-of- use asset was recognized, corresponding to the portion of the asset’s previously recognized carrying amount that relates to the right of use retained by the Group. In determining the lease term, management assessed that one of the properties would be used for a ten-year period, and two of the properties for fifteen years. The right-of-use assets amounted to MSEK 87 and the lease liability to MSEK 107. A gain of MSEK 9 was recognized, representing the rights transferred to the buyer. The second phase of the sale was completed on April 17, 2024. The associated assets were presented as assets held for sale in the balance sheet as of December 31, 2023. These assets amounted to MSEK 113 and were included in the 2023 year-end balance sheet under “Assets held for sale.” Related property loans were presented as “Liabilities directly associated with assets held for sale.” The properties were part of the Future Snacking and Quality Nutrition segments. Estimated amounts from the sale were preliminary at the time of publication of the 2023 Annual Report, and final amounts were determined upon settlement of the final purchase price. A gain of MSEK 4 was recognized, representing the rights transferred to the buyer. The right-of-use assets from the second phase of the sale amounted to MSEK 72, and the corresponding lease liability was MSEK 73. DIVESTMENT OF SUBSIDIARY On December 19, 2023, the Group announced its intention to divest Bayn Production AB as part of Humble’s long-term strategy to streamline operations. The assets and liabilities were measured at the lower of their nominal value and fair value, resulting in an impairment loss of MSEK 6 in 2023, of which MSEK 4 related to goodwill. The impairment was recognized in the income statement under depreciation and amortization of acquisition-related intangible assets. The associated assets of MSEK 17 and liabilities of MSEK 9 were presented as assets and liabilities held for sale in the 2023 year-end balance sheet. The subsidiary was part of the Future Snacking segment. The divestment was completed on January 1, 2024. NOTE 36 – SUBSEQUENT EVENTS In the first quarter of 2025, the restrictions on the MSEK 150 term loan were lifted. No other material events affecting the financial reporting have occurred after the end of the reporting period. MSEK 2023-12-31Intangible assets3Tangible fixed assetsBuildings and land113Other3Inventory4Accounts receivables4Other short-term receivables2Total Assets 129Interest-bearing liabilities-34Accounts payable-7Other liabilities -2Total Liabilities -43NET ASSETS 86
Page 117
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 117 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT PARENT COMPANY INCOME STATEMENT MSEK Note20242023Net sales38 5944Other operating income 39 12 1Total revenue 71 46Other external expenses 40 -43 -29Personnel expenses 41 -45 -43Other operating expenses 43 -2 -1 Depreciation and amortisation of fixed tangible and intangible assets 46, 47 0 0OPERATING PROFIT (EBIT) -19 -28Profit from shares in Group companies48, 49, 60194 106Interest income44 35 34Interest expenses44 -170 -355PROFIT AND LOSS AFTER FINANCIAL ITEMS 40 -243Year-end appropriations60 128 96PROFIT AND LOSS BEFORE TAX 168 -147Current taxes45-14 -5PROFIT AND LOSS AFTER TAX 154 -152In the parent company, there are no items that are reported as other comprehensive income, which is why total comprehensive income corresponds to the year's result.
Page 118
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 118 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT PARENT COMPANY BALANCE SHEET – ASSETS MSEK Note2024-12-312023-12-31ASSETSFixed assetsIntangible assetsCapitalised product development costs 2 2Software, Licensens & Domains5 0Total intangible assets467 2Tangible assetsEquipment, tools and installations0 3Total tangible assets470 3Financial assetsShares in subsidiaries48 6,264 6,311Shares in associated companies and joint ventures49 49 49Long-term receivables with group companies60 612 556Long-term receivables with associated companies and joint ventures20 6Other long-term receivables0 27Deferred tax assets54 18 18Total financial assets6,963 6,967Total fixed assets6,970 6,972Current assetsShort-term receivablesAccounts receivables0 2Receivables with group companies60 374 269Other short-term receivables50 21 18Prepaid expenses and accrued income51 2 6Total short-term receivables397 294Cash and bankCash and cash equivalents52 150 4Total cash and bank150 4Total current assets547 298TOTAL ASSETS7,517 7,269
Page 119
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 119 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT PARENT COMPANY BALANCE SHEET – EQUITY AND LIABILITY MSEK Note2024-12-312023-12-31EQUITY AND LIABILITIESEquityRestricted equityShare capital53 98 98Unregistered share capital0 0Fund for capitalised development cost0 0Total restricted equity98 98Unrestricted equityShare premium reserve4,959 4,930Accumulated profit or loss-292 -141Net profit for the year154 -152Total unrestricted equity4,821 4,637Total equity 4,920 4,735Provisions56139 507Long-term liabilitiesInterest-bearing liabilities55 1,393 1,189Liabilities to group companies9 15Other long-term liabilities56 7 11Total long-term liabilities1,409 1,215Short-term liabilitiesInterest-bearing liabilities55 358 253Accounts payable8 12Liabilities to group companies60 629 506Tax liabilities13 5Other liabilities56 35 28Accrued expenses and prepaid income57 7 7Total short-term liabilities1,050 812TOTAL EQUITY AND LIABILITIES7,517 7,269
Page 120
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 120 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT PARENT COMPANY CHANGE IN EQUITY MSEKShare capitalUnregistered share capitalFund for capitalised development costAccumulated profit or lossShare premium fundNet profit for the yearTotal shareholders equityOpening balance January 1, 2023 66 0 0 -32 4,032 -120 3,946Allocation according to decision of the annual general meeting-120 120 0Net profit of the year -152 -152Total 0 0 0 -120 0 -32 -152Transaction with owners in their capacity as owners:Share issue 31 927 958Transaction costs -28 -28Share buyback -1 -1Warrants program -1 -1Ajdustment related to transition to RFR2 13 13Closing balance December 31, 20239800-1414,930-1524,735Opening balance January 1, 2024 98 0 0 -141 4,930 -152 4,735Allocation according to decision of the annual general meeting-152 152 0Net profit of the year 154 154Total 0 0 0 -152 0 306 154Transaction with owners in their capacity as owners:Share issue1 2929Transaction costs0Share buyback0Warrants program2 2Ajdustment related to transition to RFR20Closing balance December 31, 20249800-2924,9591544,920 Restricted equityNon-restricted equity
Page 121
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 121 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT PARENT COMPANY CASH FLOW STATEMENT MSEK Note2024 2023OPERATING ACTIVITIESProfit and loss before tax168-147Adjustment for items not affecting the cash flow presentationDepreciation of tangible and intangible fixed assets00Other items61-204257Paid tax-2-1Cash flow from operating activities before changes in net working capital-38110CHANGE IN NET WORKING CAPITALChange in short-term receivalbes (increase - /decrease + )-5448Change in short-term liabilities (increase + /decrease - )-516Sum change in net working capital-5964Cash flow from operating activities-97173INVESTING ACTIVITIESAcquisition of intangible assets46-50Acquisition of tangible assets4700Acquisition of financial assets-110Disposal of financial assets13472Contingent consideration-296-244Dividends received12940Loans given to subsidiaries-8-16Loans given to joint venture-140Consideration paid, net of acquired cash0-75Change in cashpool receivable-710Cash flow from investing activities-141-223FINANCING ACTIVITIES62Share issue funds0875Direct share issue related costs-7-110Paid premium for share incentive program2-1Bond financing0-1,800Received interest40Paid interest-110-215New loans799 1,500Amortisation of loans-489 -620Amortisation of loans from subsidaries-106 0Loans from subsidiaries113 425Change in cashpool liabilities182 0Cash flow from financing activities388 54Decrease/Increase in cash and cash equivalents150 4Cash and cash equivalents at beginning of period4 1Exchange rate differences-4 -1Cash and cash equivalents at end of the year1504
Page 122
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 122 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT PARENT COMPANY NOTES NOTE 37 – ACCOUNTING PRINCIPLES OF THE PARENT COMPANY The annual report of the Parent Company has been prepared in accordance with RFR 2, Reporting for Legal Entities and the Swedish Annual Accounts Act. RFR 2 states that the Parent Company shall apply International Financial Reporting Standards (IFRS) as adopted by the EU, to the extent this is possible within the framework of the Annual Accounts Act and the Pension Obligations Vesting Act (Tryggandelagen), and with regards to the relationship between accounting and taxation. The recommendation states which exceptions and additions that are to be used in relation to IFRS. The Parent Company applies other accounting principles than the Group as stated below. FORMAT The income statement and balance sheet follow the format of the Annual Accounts Act. The statement of changes in equity follows the Group’s presentation format but must contain the columns specified in the Annual Accounts Act. Furthermore, there are differences regarding names of line items compared with the consolidated accounts, mainly regarding cash and cash equivalents, financial income and expenses, income tax and equity. SHARES IN SUBSIDIARIES Shares in subsidiaries are reported at acquisition cost less any impairment loss. Acquisition-related costs and contingent considerations are included in the acquisition value. The contingent considerations are reported as provisions and recognized at the amount which the management assesses as most likely to be paid. The contingent considerations are continuously revalued and reported at fair value using the Group’s average cost of capital. Dividends received are reported as financial income. When there is an indication that shares and participations in subsidiaries have decreased in value, a calculation of the recoverable amount is made. If this is lower than the carrying amount, an impairment loss is recorded. Impairments are recognized in the items Profit from participations in Group companies or Profit from participations in associated companies. FINANCIAL INSTRUMENT The Parent Company does not apply IFRS 9. The Parent Company instead applies the rules specified in RFR 2 (IFRS 9 Financial instruments). Financial instruments are measured at cost. In subsequent periods, financial assets acquired with the intention of being held in the short term stated at the lower of cost and net realizable value. When calculating the net realizable value of receivables that are reported as current assets, the principles for impairment testing and loss allowance in IFRS 9 shall be applied. For receivables measured at acquisition cost at Group level, the loss allowance reported in the Group in accordance with IFRS 9 must also be recognized in the Parent Company. The Parent Company's intercompany receivables undergo impairment testing according to IFRS 9. SEGMENT REPORTING Information will only be provided for the breakdown of net sales on segments and geographical areas. LEASING The Parent Company does not apply IFRS 16 Leases, instead RFR 2 IFRS 16 Leases p.2-12 is applied. This choice means that no right-of-use asset or lease liability is recognized in the balance sheet, instead the lease fee is reported as an expense on a straight-line basis over the lease term. GROUP CONTRIBUTION Group contributions made from parent companies to subsidiaries and received from subsidiaries to parent companies are reported according to the alternative rule as appropriations in the income statement and as short-term liabilities or receivables until the Group contribution has been settled.
Page 123
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 123 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 38 – PARENT COMPANY DISCLOSURE OF REVENUE The Parent Company’s net sales for 2024 amounted to MSEK 59 (44). The revenue was primarily intragroup in nature and related to time spent on strategic advisory services and ongoing management provided to the Parent Company’s subsidiaries, as well as the recharging of Group- wide expenses. There was no material external revenue in either 2024 or 2023; therefore, net sales have not been presented by geographical area or by segment . NOTE 39 – OTHER OPERATING INCOME NOTE 40 – RENUMERATION TO AUDITORS NOTE 41 – RENUMERATION TO PERSONNEL ETC. MSEK 2024 2023Fx-gains from revaluation of operational items 1 0Contingent consideration 11 0Other operating income 0 1Total other operating income 12 1KSEK 2024 2023Audit fees2,803 4,260 of which BDO2,803 4,260 of which Other audit firms- - Audit related services2,064 - of which BDO2,064 - of which Other audit firms- - Total fees to audit firms 4,867 4,260Average number of employees by countryWomenMenTotalWomenMenTotalSweden 4 15 19 4 15 18Total 4 15 19 4 15 18Women Men Total Women Men TotalBoard members 2 3 5 2 3 5CEO and other senior executives 0 5 5 0 5 5Total 2 8 10 2 8 1020242023Gender distribution in the parent company for board members and other senior executives2024-12-312023-12-31Salaries, remunerations and social charges, KSEKSalaries and other renumerationSocial chargesPensionsSalaries and other renumerationSocial chargesPensionsBoard of directors, CEO and other executive management 22,997 6,720 2,601 18,841 5,920 2,288Other employees 6,531 3,730 1,416 8,642 3,950 1,77420242023Employee benefits, KSEK 2024 2023Salaries and other renumerations 29,528 27,483Social charges 10,450 9,870Pension costs - defined contribution plan 4,017 4,062Total employee benefits 43,995 41,415
Page 124
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 124 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT For information regarding remuneration to senior executives, see Note 8 Renumeration to personnel etc. in the consolidated financial statements. INCENTIVE PROGRAMS As all of the Group’s option programs are held by the Parent Company, please refer to Note 8 Renumeration to personnel etc. for further details on the option programs. NOTE 42 – OPERATING LEASING EXPENSES The future aggregate minimum lease payments under non-cancellable operating leases are presented in the table below. Lease payments expensed during the financial year for the Parent Company amounted to MSEK 4 (3). NOTE 43 – OTHER OPERATING EXPENSES NOTE 44 – INTEREST INCOME AND SIMILAR ITEMS, AND INTEREST EXPENSE AND SIMILAR ITEMS MSEK20242023Within 1 year 3 3Between 1 and 5 years 2 4Later 0 0Total 5 7MSEK 2024 2023Exchange rate losses from revaluation of items of an operating nature-1-1Other-1-1Total other operating expenses -2 -1MSEK 2024 2023Interest income, intercompany 34 28Exchange rate differences 1 3Other financial income 0 3Total financial income3534Interest expenses -122 -272Interest expenses, intercompany -10 -8Exchange rate differences -6 -6Other financial expenses -33 -69Total financial expenses -170 -355Total net of financial items -135 -321
Page 125
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 125 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 45 – INCOME TAX The Parent Company’s current tax rate is 20.6% (20.6%), and the effective tax rate amounted to 8.2% (-3.6%). NOTE 46 – INTANGIBLE ASSETS NOTE 47 – TANGIBLE ASSETS MSEK 2024 2023Current tax-14-5Deferred tax00Total income tax -14 -5Reconciliation between Swedish income tax rate and effective income taxProfit before tax168-147Tax according current tax rate 20,6% (20,6%)-3530Tax effect from: Non-deductible expenses-21-66Non-taxable income4224Trasaction cost recognised in equity06Income tax -14 -5MSEK 2024 2023 2024 2023Opening balance acquisitions 2 1 0 0Purchases 0 0 5 0Sale to group companies 0 0 0 0Accumulated acquisition value 2 2 5 0Opening balance depreciations 0 0 0 0Sale to group companies 0 0 0 0Depreciations 0 0 0 0Accumulated depreciation 0 0 0 0Closing balance 2 2 5 0 Capitalised product development costsSoftware, Licensens & Domains MSEK 2024 2023 2024 2023Opening balance acquisitions 2 1 0 0Purchases 0 0 5 0Sale to group companies 0 0 0 0Accumulated acquisition value 2 2 5 0Opening balance depreciations 0 0 0 0Sale to group companies 0 0 0 0Depreciations 0 0 0 0Accumulated depreciation 0 0 0 0Closing balance 2 2 5 0 Capitalised product development costsSoftware, Licensens & Domains
Page 126
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 126 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 48 – SHARES IN SUBSIDARIES In 2024, Humble Group AB divested Bayn Production AB and the property companies Fewalco Fastighets AB, Ewalco International Aktiebolag, Napame Holding AB, Gudrun Fastighet AB, and Runes Specialbageri AB as part of a sale and leaseback transaction. Nordfood International AB was merged into Green Sales Distribution AB, and Fitness Empire Nordic AB was merged into Nordic Sports Nutrition AB. Corpus Medicus AS was liquidated during 2024. MSEK 2024 2023Opening balance 6,311 6,271Acquisitions 0 150This years disposals -49 0Shareholders contribution 68 5Revaluation of contingent considerations-65 -115Closing balance 6,264 6,3112024-12-312023-12-31Bayn Europe Financial AB 559131-8331Sweden, Stockholm100%102 102 Bayn Solutions AB 559152-1371Sweden, Stockholm100%4,573 4,573 Monday2Sunday AB 559027-8700Sweden, Stockholm100%61,206 61,206 Tweek AB 559010-9822Sweden, Varberg100%82,414 82,414 Bayn Production AB 559168-2371Sweden, Varberg100%- 6,000 Bayn Nordic AB 559291-6406 Sweden, Stockholm100%50 50 Green Sales Newco AB 559265-6069Sweden, Stockholm100%28,489 28,489 Green Sales Distributions AB 556644-2256Sweden, Kumla100%- - BE:Son Gross AB 556284-2897Sweden, Varberg100%- - Nordfood International AB 556831-8678Sweden, Varberg100%- - Golden Athlete AB 556998-5194Sweden, Stockholm100%22,126 21,182 Performance R Us AB 556629-0630Sweden, Stockholm100%- - Nordic Sports Nutrition AB 556642-8693Sweden, Lindesberg100%- - Fitness Emire Nordic AB 559135-4625Sweden, Lindesberg100%- - Viterna AB 559223-7134Sweden, Stockholm100%- - Fitnessgrossisten AS NO992343230Norway, Kristiansand100%- - The Humble Co. 556936-4341Sweden, Stockholm100%1,200,751 1,200,751 JB Operations AB 559265-6218Sweden, Stockholm100%- - The Eco Gang AB 559277-6818Sweden, Stockholm100%- - The Humble Company North America Inc C4632856USA, California100%- - Humble Incubator AB 559462-8140Sweden, Stockholm100%- - Humble Hatten AB 559465-6828Sweden, Stockholm78%- - Grahns Konfektyr AB556724-8884Sweden, Skövde100%75,773 75,773 Kryddhuset i Ljung AB 556416-9786Sweden, Ljung100%14,233 14,233 Wellibites AB 559160-0175Sweden, Gothenburg100%57,499 56,881 Ewalco Holding AB 556580-5537Sweden, Gothenburg100%195,031 195,286 Ewalco Aktiebolag 556056-0152Sweden, Gothenburg100%- - Ewalco Production AB 556162-1508Sweden, Gothenburg100%- - Ewalco Fastighet AB 559480-3727Sweden, Gothenburg100%- - Amazing Food AB 559480-3719Sweden, Gothenburg100%- - Fewalco Fastighets AB 556667-5335Sweden, Gothenburg100%- - Ewalco International Aktiebolag 556120-7605Sweden, Gothenburg100%- - Arena Nutrition AB 556688-6924Sweden, Gothenburg100%215 - FancyStage Unipessoal Lda 510.250.530Portugal, Trofa100%439,251 407,618 Marabu Markenvertireb Gmbh HRB 67273Germany, Langenfeld100%81,815 77,794 Naty AB 556487-2223Sweden, Stockholm100%750,726 782,726 Naty SARL FR505180679France, Paris100%- - Naty USA Inc. P12000030239USA, Florida100%- - Naty GMBH HRB190128BGermany, Berlin100%- - Naty Korea LLC SK663-86-01143South Korea, Seoul100%- - Naty Ltd GB13611208United Kingdom, London100%- - Company nameCorporate reg. NoDomicileShares & VotesBook value (KSEK)
Page 127
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 127 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT 2024-12-312023-12-31Swedish Food Group AB 559213-3861Sweden, Lund100%264,271 256,071 First Class Brands of Sweden AB 556666-3315Sweden, Lund100%- - BSC Europe AB 556925-8055Sweden, Lund100%1,062 62 HealthyCo AB 559006-3862Sweden, Lund100%- - Solent Global Ltd GB10818497United Kingdom, Hampshire100%1,351,946 1,348,249 Solent Global Holdings Ltd GB08544214United Kingdom, Hampshire100%- - Solent Group (SA) Pty Ltd** SA2015/347642/07South Africa, Cape Town49%- - Solent International Ltd GB04293623United Kingdom, Hampshire100%- - Solent Homecare Ltd GB09398128United Kingdom, Hampshire100%- - Xpel Marketing Ltd GB06557112United Kingdom, Cheshire100%- - Solent Manufacturing Ltd (HK) HK575873Hong Kong, Kowloon100%- - Solent Manufacturing Ltd (PRC)CN9131000058-343458XLChina, Shanghai 100%- - Retail Brands Ltd GB01625974United Kingdom, Hampshire100%- - Solent Brands Ltd GB10152689United Kingdom, Hampshire100%- - Solent Packaging Ltd GB04819079United Kingdom, Hampshire100%- - Solent Group SA (HK) Ltd HK2179777Hong Kong, Kowloon100%- - Solent Home and Garden Ltd GB06344152United Kingdom, Hampshire100%- - Carls-Bergh Pharma AB 556057-6638Sweden, Gothenburg100%17,730 17,730 Assertia Fastigheter AB 559111-9580Sweden, Gothenburg100%- - Vitargo AB 556609-8793Sweden, Kalmar100%44,326 44,326 Soya OY FO0789690-3Finland, Tammisaari100%46,819 45,908 FAB Tallebo FO1480049-8Finland, Tammisaari100%- - Delsbo Candle AB 556655-3714Sweden, Delsbo100%75,333 81,578 Group 472 Aps CVR41551909Denmark, Copenhagen100%- - True Aps CVR38460161Denmark, Copenhagen100%257,527 277,111 True Company GmbH HRB166353Germany, Hamburg100%- - Arne & Björn AB 556729-3815Sweden, Gråbo100%55,404 59,051 Bars Produktion i Gråbo AB 556648-3029Sweden, Gråbo100%- - Gudrun Fastighet AB 559203-2188Sweden, Gråbo100%- - Runes Specialbageri AB 556168-8853Sweden, Gråbo100%- - La Praline Scandinavia AB 556702-5373Sweden, Borås100%21,857 21,857 Grenna Konfektyr AB 556357-5066Sweden, Jönköping100%23,445 23,445 Grenna Polkagriskokeri AB 559221-9439Sweden, Jönköping100%- - CLJ Grenna AB 559223-4362Sweden, Jönköping100%- - Superfoods Group Ltd GB12499852United Kingdom, Sheffield100%201,294 201,294 Go Superfoods Ltd GB08319689United Kingdom, Sheffield100%- - Green Origins Superfoods Ltd GB690744United Kingdom, Sheffield100%- - Nya MedicaNatumin AB 559370-2797Sweden, Jönköping100%119,427 119,427 Ambria Dermatology AB 556617-8751Sweden, Jönköping100%- - DeNovaStella AB 556605-4465Sweden, Jönköping100%- - Medica Clinical Nord Sverige AB 556749-4223Sweden, Jönköping100%- - Natumin Pharma AB 556474-7748Sweden, Jönköping100%- - Nordic Immotech Sweden AB 556729-1363Sweden, Jönköping100%- - Vitalkost AS NO961937434Norway, Tönsberg100%- - Corpus Medicus AS NO856154432Norway, Tönsberg100%- - Tricutan AB 556702-6256Sweden, Jönköping100%- - Franssons Konfektyr AB 556223-9946Sweden, Gränna100%39,752 39,752 Laboratiorio Francediet - Fabrico de Produtos de Dietética LDAPT504 738 003 Portugal, Porto 100% - - Protinortesul - Comercializacao do Produtos Dietéticos LDAPT506 325 695 Portugal, Porto 100% - - Nutrilisboa - Comercializacao do Produtos Dieteticos LDAPT506 626 717 Portugal, Lisbon 100% - - Nutricelebration Unipessoal LDA PT510 650 589Portugal, Lisbon100%- - Protiminho - Design e Publicidade LDA PT507 386 620Portugal, Porto100%- - FDiet Lev CD, S.L. SP B86494556Spain, Madrid100%230,395 238,706 Cebripast - Centro De Fabrico de Pastelaria Nutritiva LDAPT513 278 524 Portugal, Aveiro 100% - - Amber House LtdGB05317536United Kingdom, Lewes100%97,926 97,745 Sam & Son Grossist AB556328-2879Sweden, Nässjö100%171,647 142,357 Go'Berts Konfektyr AB556549-3920Sweden, Nässjö100%- -
Page 128
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 128 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 49 – SHARES IN ASSOCIATED COMPANIES AND JOINT VENTURES The table above presents Amerpharma, which is the joint venture the Parent Company has direct ownership in. Furthermore, the Parent Company has holdings in an associate company, Snacksmack AB, part owned by Grahns Konfektyr AB. The companies are considered individually immaterial. All holdings have been reported according to the Equity Method. During the year, there have been no changes in capital and/or voting shares for any of the Parent Company's associate companies and partnership arrangements. NOTE 50 – OTHER SHORT-TERM RECEIVABLES NOTE 51 – PREPAID EXPENSES AND ACCRUED INCOME 2024-12-31 2023-12-31Humble Pacific Holdings Pty Ltd ACN 660 974 498Australia, Queensland100%121,852 131,569 Body Science International Pty Ltd ACN 101 197 835Australia, Queensland100%- - Bars Produktion Australia Pty Ltd ACN 671 433 195Australia, Prestons100%- - Napame Holding AB 559051-0342Sweden, Hindås100%- 15,491 Aktiebolaget Cool & Candy AB 556330-4137Sweden, Ystad100%- 27,091 Skövde Snabbgross AB 556436-3207Sweden, Trollhättan100%94,600 94,600 Privab Grossisterna AB 556584-9543Sweden, Göteborg100%12,653 12,653 Humble Group USA Inc. 5317180USA, Wilmington100%- - Swedish Candy by Humble AB 559509-4557Sweden, Stockholm100%- - Total booked value6,263,5216,311,153*There have been no changes in the shares or voting rights. **Humble Group consider having controlling influence of entityMSEK 2024 2023Opening balance 49 49Acquisitions 0 0Closing balance 49 49Company nameCorporate reg. NoDomicileShares %Votes %2024-12-312023-12-31Snacksmack AB 559075-5103 Skövde, Sweden 50% 50% - - Amerpharma SP.z o.o. PL9462694214 Lubin, Poland 51% 44% 48,865 48,730Book value, KSEK MSEK 2024-12-31 2023-12-31VAT Receivables11Other tax receivables02Contingent consideration110Other receivables915Total other short-term receivables 21 18MSEK 2024-12-31 2023-12-31Prepaid rents 1 1Other items 1 5Total prepaid expenses and accrued income 2 6
Page 129
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 129 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 52 – LIQUID FUNDS More information about the Parent Company’s revolving credit facility is presented in Note 24 Liquid funds. NOTE 53 – SHARE CAPITAL There is only one class of shares, and all shares carry equal voting rights. All shares issued by the Parent Company are fully paid. During 2024, the number of shares increased by approximately 3 million through a non-cash (contribution in kind) issue. At the Annual General Meeting in May 2024, a new warrant program was approved, resulting in the issuance of 6,000,000 new warrants. The warrants allocated under the 2021/2024 series expired during the year. No other changes occurred during the year in relation to outstanding warrants. Further information on Humble’s warrant programs can be found in Note 8 Renumeration to personnel etc.. NOTE 54 – DEFERRED TAX Deferred tax assets are recognized for tax loss carryforwards or other deductions to the extent that it is probable they can be utilized against future taxable profits. The Parent Company has no unutilized tax loss carryforwards for which a deferred tax asset has not been recognized in any of the periods presented. Deferred tax related to unutilized tax loss carryforwards amounted to MSEK 18 (18) as of December 31, 2024. The deficit deductions do not expire at any time. MSEK 2024-12-31 2023-12-31Cash at bank 150 4Total available cash and cash equivalent 150 4Negotiatied revolving credit facility 225 150whereof used amount at end of the year 194 92whereof available amount at end of the year 31 582024-12-31 2023-12-31Number of shares446,575,533 443,544,543 Quota value0.22 0.22 Share capital98,246,617 97,579,799 Change in number of shares 2024 2023Opening balance443,544,543 301,274,580 Non-cash issue3,030,990 10,684,963 Direct cash issue- 131,585,000 Closing balance number of shares446,575,533 443,544,543 Closing outstanding share warrants12,500,000 7,420,000 Closing balance number of shares after dilution459,075,533 450,964,543 Deferred tax assets attributable to tax loss deductions2024 2023Opening balance 18 18Reversal of temporary differences 0 0Closing carrying value deferred tax asset18 18
Page 130
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 130 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 55 – INTEREST-BEARING LIABILITIES More information about the Parent Company’s interest-bearing liabilities is presented in Note 4 Financial risk management. NOTE 56 – OTHER LIABILITIES AND PROVISIONS NOTE 57 – ACCRUED EXPENSES AND PREPAID INCOME NOTE 58 – PLEDGED ASSETS AND CONTINGENT LIABILITIES There are no contingent liabilities such as ongoing disputes or guarantee commitments in the Parent Company at the end of the financial year. NOTE 59 – BUSINESS COMBINATIONS All the Parent Company’s acquisitions are presented in Note 31 Business combinations. MSEK 2024-12-31 2023-12-31Long-term liabilitiesCredit facility, long-term 1,222 1,088Liabilities to credit institutions, revolving credit facility and factoring 171 101Total long-term liabilities 1,393 1,189Short-term liabilitiesLiabilities to credit institutionsCredit facility, short-term 164 161Cash pool 194 92Total short-term liabilities 358 253Total interest-bearing expenses 1,751 1,442MSEK 2024-12-31 2023-12-31Long-term liabilitiesDeferred considerations from acquisitions25165Other liabilities711Total other liabilities and provisions, long-term31176Short-term liabilitiesDeferred considerations from acquisitions115336Provision for deferred tax liability07Other liabilities3528Total other liabilities and provisions, short-term150371Total other liabilities and provisions181547MSEK 2024-12-31 2023-12-31Accrued vacation salaries33Accrued bonus23Accrued social charges22Total accrued expenses and prepaid income77MSEK 2024-12-31 2023-12-31Regarding liabilities to credit institutionsShares in subsidiaries in favor to credit facilities5,3175,339Internal loans458439Company mortgage44Total pledged assets5,7795,782
Page 131
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 131 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 60 – RELATED PARTY DISCLOSURES The highest parent company in the Group is Humble Group AB. Related parties are all subsidiaries within the Group as well as senior executives in the Group and their close relatives. Transactions take place on market terms. For information on compensation to the CEO, board and senior executives, see Note 8 Renumeration to personnel etc. For information on holdings in subsidiaries, see Note 48 Shares in subsidiaries. The following transactions have taken place with related parties. This year's lending primarily consists of the Parent Company's financing of acquisitions through subsidiaries in the group, as well as working capital needs at subsidiaries. Lending to subsidiaries occurs at arm's length. The Parent Company's credit cost for lending to subsidiaries is determined among other things by considering the subsidiaries' underlying financial performance, the purpose of the loan, and the consideration of any country- specific risk. There are both annuity and interest- only loans to subsidiaries. The average maturity for new loans is usually set at 3 years, after which the terms are renegotiated. As the Parent Company, Humble Group AB follows the respective subsidiaries' financial development as a natural part of the operational management and monitoring of the operations. At the end of the fiscal year, the Group management's assessment is that there is no increased or significant credit risk in the existing lending to subsidiaries, whereupon no provision for possible credit losses has been reported in Humble Group AB. During the year, the Parent Company received a dividend from subsidiaries amounting to MSEK 135 (40). NOTE 61 – ADJUSTMENT FOR NON-CASH ITEMS FROM OPERATING ACTIVITES MSEK 2024 2023Sales during the year to group companies59 4Purchases during the year from group companies-3 -1Interest income from group companies34 28Interest cost to group companies -10 -8Group contributions, given -54 -18Group contributions, received 182 115Long-term loans to subsidiaries2024-12-31 2023-12-31Opening balance 556 576Lending of the year 131 121Amortizations -75 -141Closing balance 612 556MSEK2024 2023Interest expenses partially presented in financing activities-39 259 Results from sale of shares in subsidiaries presented in investing activities-58 0Contingent consideration -11 0Impairment of shares in subsidaries 0 11Non realised interest on contingent considerations 33 69Other provisions -7 0Accrued expense 0 9Group contributions, given 54 18Group contributions, received -182 -115Effect from exchange rates 5 6Total adjustment items -204 257
Page 132
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 132 SUSTAINABILITY BUSINESS OVERVIEW Management administration report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT NOTE 62 – CHANGES IN LIABILITIES BELONGING TO FINANCING ACTIVITES NOTE 63 – PROPOSED APPROPRIATION OF PROFITS The Board of Directors of Humble Group AB proposes that no dividend be paid for the financial year 2024 and that the accumulated loss for the year be appropriated as follows (SEK) NOTE 64 – SUBSEQUENT EVENTS In the first quarter of 2025, the restrictions on the MSEK 150 term loan were lifted. No other significant events have occurred in the Parent Company after the end of the financial year. MSEKBond loanLiabilities to credit institutionsOpening balance January 1, 2023 1,826 571Cash flow from financing activities -1,800 880Other -26 -9 Closing balance December 31, 2023 0 1,442Cash flow from financing activities 0 310Other 0 -1 Closing balance December 31, 2024 0 1,751Accumulated profit or loss-291,813,362Share premium reserve4,958,909,125Net loss for the year154,334,436Total 4,821,430,199Proposed appropriation of profits4,821,430,199
Page 133
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 133 SUSTAINABILITY BUSINESS OVERVIEW Management governance report Parent company financial statement and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT SIGNATURES The undersigned hereby confirm that the consolidated financial statements and the annual report have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU and generally accepted accounting principles, respectively, and provide a true and fair view of the financial position and performance of the Group and the Parent Company. Furthermore, the Board of Directors' Report provides a fair overview of the operations, financial position, and performance of the Group and the Parent Company, and describes the material risks and uncertainties faced by the Parent Company and the companies included in the Group. Stockholm April 9, 2025 Dajana Mirborn Ola Cronholm Chairman of the board Board member Henrik Patek Pål Bruu Board member Board member Sara Berger Noel Abdayem Board member Board member Simon Petrén Chief Executive Officer Our audit report has been released according to digital signatures. BDO Carl-Johan Kjellman Authorized Public Accountant
Page 134
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 134 SUSTAINABILITY BUSINESS OVERVIEW Management governance report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT AUDITOR’S REPORT To the general meeting of the shareholders of Humble Group AB, corporate identity number 556794-4797 REPORT ON THE ANNUAL ACCOUNTS AND CONSOLIDATED ACCOUNTS OPINIONS We have audited the annual accounts and consolidated accounts of Humble Group AB for the financial year 2024. The annual accounts and consolidated accounts of the company are included on pages 72-133 in this document. In our opinion, the annual accounts have been prepared in accordance with the Annual Accounts Act and present fairly, in all material respects, the financial position of parent company as of 31 December 2024 and its financial performance and cash flow for the year then ended in accordance with the Annual Accounts Act. The consolidated accounts have been prepared in accordance with the Annual Accounts Act and present fairly, in all material respects, the financial position of the group as of 31 December 2024 and their financial performance and cash flow for the year then ended in accordance with IFRS Accounting Standards, as adopted by the EU, and the Annual Accounts Act. The statutory administration report is consistent with the other parts of the annual accounts and consolidated accounts. We therefore recommend that the general meeting of shareholders adopts the income statement and balance sheet for the parent company and the group. Our opinions in this report on the annual accounts and consolidated accounts are consistent with the content of the additional report that has been submitted to the parent company's Audit Committee in accordance with the Audit Regulation (537/2014/EU) Article 11. BASIS FOR OPINIONS We conducted our audit in accordance with International Standards on Auditing (ISA) and generally accepted auditing standards in Sweden. Our responsibilities under those standards are further described in the Auditor’s Responsibilities section. We are independent of the parent company and the group in accordance with professional ethics for accountants in Sweden and have otherwise fulfilled our ethical responsibilities in accordance with these requirements. This includes that, based on the best of our knowledge and belief, no prohibited services referred to in the Audit Regulation (537/2014/EU) Article 5.1 have been provided to the audited company or, where applicable, its parent company or its controlled companies within the EU. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinions. KEY AUDIT MATTERS Key audit matters of the audit are those matters that, in our professional judgment, were of most significance in our audit of the annual accounts and consolidated accounts of the current period. These matters were addressed in the context of our audit of, and in forming our opinion thereon, the annual accounts and consolidated accounts as a whole, but we do not provide a separate opinion on these matters. Valuation of goodwill and shares in subsidiaries Goodwill is a significant asset in the balance sheet for the group and shares in subsidiaries is a significant asset in the balance sheet for the parent company. The group reports goodwill of MSEK 3 807 as of 31 December 2024 and the parent company reports shares in subsidiaries of MSEK 6 264 as of 31 December 2024. The Company’s evaluation of goodwill for impairment involves a comparison of the recoverable amount for each cash generating unit to its carrying value. The Company’s evaluation of shares in subsidiaries involves a comparison of the recoverable amount for each subsidiary to its carrying value. The Company’s assessment of the recoverable amount is based on discounted future cash flow models derived from internal business plans covering five years followed by a gradually declining cash flow development in the following period to its terminal value. The assessment requires management to make significant estimates and assumptions regarding forecasts of future sales growth, gross margins, operating expenses, working capital and capital expenditure requirements, as well as assumptions on discount rates. Changes in judgements and estimates made by management may have a material effect on the financial statements and consequently Valuation of
Page 135
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 135 SUSTAINABILITY BUSINESS OVERVIEW Management governance report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT goodwill and Shares in Subsidiaries is considered a key audit matter. Disclosures regarding goodwill are included in note 3 Significant accounting estimates and judgments, note 14 Intangible assets and note 31 Business combinations. Disclosures regarding shares in subsidiaries are included in note 37 Accounting principles of the parent company and note 48 Shares in subsidiaries. Our audit procedures included but were not limited to: We gained an understanding of the impairment assessment process and evaluated the design and implementation of relevant internal controls over impairment evaluation. We evaluated management’s ability to accurately forecast future sales growth and gross margin by comparing actual results to management’s historical forecasts and the Company’s historical results. With the assistance of our valuation specialists, we further evaluated the company’s sensitivity analysis by comparing to our own sensitivity analysis to corroborate the disclosures around assumptions that are most sensitive to a reasonably possible change that could cause the carrying amount to exceed its recoverable amount for a cash generating unit. With the assistance of our valuation specialists, we evaluated the discount rates and the long- term growth rate, including testing the underlying source information and the mathematical accuracy of the calculations, and developing a range of independent estimates and comparing those to the discount rates selected by management. OTHER INFORMATION THAN THE ANNUAL ACCOUNTS AND CONSOLIDATED ACCOUNTS This document also contains other information than the annual accounts and consolidated accounts and is found on pages 2-18, 29-71 and 137-139. The Board of Directors and the Managing Director are responsible for this other information. Our opinion on the annual accounts and consolidated accounts does not cover this other information and we do not express any form of assurance conclusion regarding this other information. In connection with our audit of the annual accounts and consolidated accounts, our responsibility is to read the information identified above and consider whether the information is materially inconsistent with the annual accounts and consolidated accounts. In this procedure we also take into account our knowledge otherwise obtained in the audit and assess whether the information otherwise appears to be materially misstated. If we, based on the work performed concerning this information, conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. RESPONSIBILITIES OF THE BOARD OF DIRECTORS AND THE MANAGING DIRECTOR The Board of Directors and the Managing Director are responsible for the preparation of the annual accounts and consolidated accounts and that they give a fair presentation in accordance with the Annual Accounts Act and, concerning the consolidated accounts, in accordance with IFRS Accounting Standards, as adopted by the EU. The Board of Directors and the Managing Director are also responsible for such internal control as they determine is necessary to enable the preparation of annual accounts and consolidated accounts that are free from material misstatement, whether due to fraud or error. In preparing the annual accounts and consolidated accounts, The Board of Directors and the Managing Director are responsible for the assessment of the company’s and the group’s ability to continue as a going concern. They disclose, as applicable, matters related to going concern and using the going concern basis of accounting. The going concern basis of accounting is however not applied if the Board of Directors and the Managing Director intends to liquidate the company, to cease operations, or has no realistic alternative but to do so. The Audit Committee shall, without prejudice to the Board of Directors’ responsibilities and tasks in general, among other things oversee the company’s financial reporting process. AUDITOR’S RESPONSIBILITY Our objectives are to obtain reasonable assurance about whether the annual accounts and consolidated accounts as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinions. Reasonable assurance is a high level
Page 136
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 136 SUSTAINABILITY BUSINESS OVERVIEW Management governance report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT of assurance but is not a guarantee that an audit conducted in accordance with ISAs and generally accepted auditing standards in Sweden will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these annual accounts and consolidated accounts. As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also: Identify and assess the risks of material misstatement of the annual accounts and consolidated accounts, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinions. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Obtain an understanding of the company’s internal control relevant to our audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control. Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Board of Directors and the Managing Director. Conclude on the appropriateness of the Board of Directors’ and the Managing Director’s use of the going concern basis of accounting in preparing the annual accounts and consolidated accounts. We also draw a conclusion, based on the audit evidence obtained, as to whether any material uncertainty exists related to events or conditions that may cast significant doubt on the company’s and the group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the annual accounts and consolidated accounts or, if such disclosures are inadequate, to modify our opinion about the annual accounts and consolidated accounts. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause a company and a group to cease to continue as a going concern. Evaluate the overall presentation, structure and content of the annual accounts and consolidated accounts, including the disclosures, and whether the annual accounts and consolidated accounts represent the underlying transactions and events in a manner that achieves fair presentation. Plan and perform the group audit to obtain sufficient and appropriate audit evidence regarding the financial information of the entities or business units within the group as a basis for forming an opinion on the consolidated accounts. We are responsible for the direction, supervision and review of the audit work performed for purposes of the group audit. We remain solely responsible for our opinions. We must inform the Board of Directors of, among other matters, the planned scope and timing of the audit. We must also inform of significant audit findings during our audit, including any significant deficiencies in internal control that we identified. We must also provide the Board of Directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. From the matters communicated with the Board of Directors, we determine those matters that were of most significance in the audit of the annual accounts and consolidated accounts, including the most important assessed risks for material misstatement, and are therefore the key audit matters. We describe these matters in the auditor’s report unless law or regulation precludes disclosure about the matter.
Page 137
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 137 SUSTAINABILITY BUSINESS OVERVIEW Management governance report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS THE AUDITOR’S AUDIT OF THE ADMINISTRATION OF THE BOARD OF DIRECTORS AND THE MANAGING DIRECTOR AND THE PROPOSED APPROPRIATIONS OF THE COMPANY’S PROFIT OR LOSS OPINIONS In addition to our audit of the annual accounts and consolidated accounts, we have also audited the administration of the Board of Directors and the Managing Director of Humble Group AB for the financial year 2024 and the proposed appropriations of the company’s profit or loss. We recommend to the general meeting of shareholders that the profit be appropriated in accordance with the proposal in the statutory administration report and that the members of the Board of Directors and the Managing Director be discharged from liability for the financial year. BASIS FOR OPINIONS We conducted the audit in accordance with generally accepted auditing standards in Sweden. Our responsibilities under those standards are further described in the Auditor’s Responsibilities section. We are independent of the parent company and the group in accordance with professional ethics for accountants in Sweden and have otherwise fulfilled our ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinions. RESPONSIBILITIES OF THE BOARD OF DIRECTORS AND THE MANAGING DIRECTOR The Board of Directors is responsible for the proposal for appropriations of the company’s profit or loss. At the proposal of a dividend, this includes an assessment of whether the dividend is justifiable considering the requirements which the company's and the group’s type of operations, size and risks place on the size of the parent company's and the group’s equity, consolidation requirements, liquidity and position in general. The Board of Directors is responsible for the company’s organization and the administration of the company’s affairs. This includes among other things continuous assessment of the company’s and the group’s financial situation and ensuring that the company's organization is designed so that the accounting, management of assets and the company’s financial affairs otherwise are controlled in a reassuring manner. The Managing Director shall manage the ongoing administration according to the Board of Directors’ guidelines and instructions and among other matters take measures that are necessary to fulfill the company’s accounting in accordance with law and handle the management of assets in a reassuring manner. AUDITOR’S RESPONSIBILITY Our objective concerning the audit of the administration, and thereby our opinion about discharge from liability, is to obtain audit evidence to assess with a reasonable degree of assurance whether any member of the Board of Directors or the Managing Director in any material respect: has undertaken any action or been guilty of any omission which can give rise to liability to the company, or in any other way has acted in contravention of the Companies Act, the Annual Accounts Act or the Articles of Association. Our objective concerning the audit of the proposed appropriations of the company’s profit or loss, and thereby our opinion about this, is to assess with reasonable degree of assurance whether the proposal is in accordance with the Companies Act. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with generally accepted auditing standards in Sweden will always detect actions or omissions that can give rise to liability to the company, or that the proposed appropriations of the company’s profit or loss are not in accordance with the Companies Act. As part of an audit in accordance with generally accepted auditing standards in Sweden, we exercise professional judgment and maintain professional skepticism throughout the audit. The examination of the administration and the proposed appropriations of the company’s profit or loss is based primarily on the audit of the accounts. Additional audit procedures performed are based on our professional judgment with starting point in risk and materiality. This means that we focus the examination on such actions, areas and relationships that are material for the operations and where deviations and violations would have particular importance for the company’s situation.
Page 138
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 138 SUSTAINABILITY BUSINESS OVERVIEW Management governance report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT We examine and test decisions undertaken, support for decisions, actions taken and other circumstances that are relevant to our opinion concerning discharge from liability. As a basis for our opinion on the Board of Directors’ proposed appropriations of the company’s profit or loss we examined the Board of Directors’ reasoned statement and a selection of supporting evidence in order to be able to assess whether the proposal is in accordance with the Companies Act. THE AUDITOR’S EXAMINATION OF THE ESEF REPORT OPINION In addition to our audit of the annual accounts and consolidated accounts, we have also examined that the Board of Directors and the Managing Director have prepared the annual accounts and consolidated accounts in a format that enables uniform electronic reporting (the Esef report) pursuant to Chapter 16, Section 4 a of the Swedish Securities Market Act (2007:528) for Humble Group AB for the financial year 2024. Our examination and our opinion relate only to the statutory requirements. In our opinion, the Esef report has been prepared in a format that, in all material respects, enables uniform electronic reporting. BASIS FOR OPINION We have performed the examination in accordance with FAR’s recommendation RevR 18 Examination of the Esef report. Our responsibility under this recommendation is described in more detail in the Auditors’ responsibility section. We are independent of Humble Group AB in accordance with professional ethics for accountants in Sweden and have otherwise fulfilled our ethical responsibilities in accordance with these requirements. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. RESPONSIBILITIES OF THE BOARD OF DIRECTORS AND THE MANAGING DIRECTOR The Board of Directors and the Managing Director are responsible for the preparation of the Esef report in accordance with the Chapter 16, Section 4 a of the Swedish Securities Market Act (2007:528), and for such internal control that the Board of Directors and the Managing Director determine is necessary to prepare the Esef report without material misstatements, whether due to fraud or error. AUDITOR’S RESPONSIBILITY Our responsibility is to obtain reasonable assurance whether the Esef report is in all material respects prepared in a format that meets the requirements of Chapter 16, Section 4(a) of the Swedish Securities Market Act (2007:528), based on the procedures performed. RevR 18 require us to plan and execute procedures to achieve reasonable assurance that the Esef report is prepared in a format that meets these requirements. Reasonable assurance is a high level of assurance, but it is not a guarantee that an engagement carried out according to RevR 18 and generally accepted auditing standards in Sweden will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the Esef report. The audit firm applies International Standards on Quality Management 1, which requires the firm to design, implement and operate a system of quality management, including documented policies and procedures regarding compliance with professional ethical requirements, professional standards, and legal and regulatory requirements. The examination involves obtaining evidence, through various procedures, that the Esef report has been prepared in a format that enables uniform electronic reporting of the annual accounts and consolidated accounts. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement in the report, whether due to fraud or error. In carrying out this risk assessment, and in order to design audit procedures that are appropriate in the circumstances, the auditor considers those elements of internal control that are relevant to the preparation of the Esef report by the Board of Directors and the Managing Director, but not for the purpose of expressing an opinion on the effectiveness of those internal controls.
Page 139
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 139 SUSTAINABILITY BUSINESS OVERVIEW Management governance report Parent company financial statements and notes Consolidated financial statement and notes Auditor’s report CORPORATE GOVERNANCE ANNUAL REPORT The examination also includes an evaluation of the appropriateness and reasonableness of assumptions made by the Board of Directors and the Managing Director. The procedures mainly include a validation that the Esef report has been prepared in a valid XTHML format and a reconciliation of the Esef report with the audited annual accounts and consolidated accounts. Furthermore, the procedures also include an assessment of whether the consolidated statement of financial performance, financial position, changes in equity, cash flow and disclosures in the Esef report has been marked with iXBRL in accordance with what follows from the Esef regulation. BDO Mälardalen AB was appointed auditor of Humble Group AB by the general meeting of the shareholders on 22 May 2024 and has been the company’s auditor since 2020. Humble Group AB has been a public interest entity since 27 September 2024. Stockholm, date and signature on the Swedish original BDO Mälardalen AB Carl-Johan Kjellman Authorized Public Accountant This is a translation of the Swedish language original. In the event of any differences between this translation and the Swedish language original, the latter shall prevail.
Page 140
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 140 SUSTAINABILITY BUSINESS OVERVIEW CORPORATE GOVERNANCE ANNUAL REPORT DEFINITIONS AND CALCULATIONS ON KEY RATIO DEFINITIONS Contingent consideration Deferred purchase price payments that are contingent upon future performance of an acquired subsidiary. The consideration can be paid in both cash and shares and are presented to fair value based on management’s best estimate of the occurrence of future payments. FMCG FMCG is an industry term and is short for Fast- Moving Consumer Goods. NIBD Short for Net interest-bearing debt. LTM Short for Last twelve months. Last twelve months Adjusted EBITDA proforma Adjusted EBITDA proforma present the accumulated EBITDA before intra group eliminations in all entities in the Group where an agreement of acquisition or divestment have been entered at the date of this report, adjusted for items affecting comparability. LTM Adjusted EBITDA proforma is an important key figure for the Group, as it is included in the covenant calculation. CALCULATIONS ON KEY RATIO Use of Key Ratios not defined in IFRS Humble applies ESMA's (European Securities and Markets Authority) guidelines for alternative performance measures (APM). An APM is a financial measure of historical or future financial results, financial position or cash flow that has not been defined in IFRS. To facilitate analysis of the Group’s development by group management and other stakeholders, Humble uses certain APMs. The APMs aim to provide additional information and do not replace key figures according to IFRS. Humbles definitions of APM may differ from those of other companies. See Annual Report 2023 for the previous year's calculations. Gross Profit Net sales less raw materials and consumables. Gross Profit is calculated as 7,708 – 5,289 = MSEK 2,419. Gross Margin Gross Profit in relation to net sales. Gross Margin is calculated as 2,419 / 7,708 = 31%. Organic growth in net sales Change in net sales adjusted for exchange rate effect and net sales from acquired and divested subsidiaries during the period. Organic growth in net sales is calculated as (660 – 20 + 25) / 7,708 = 9%. EBITDA Earnings before interest, tax, depreciation, amortization, write-down and depreciation and amortization on acquisition-related surplus values. EBITDA is calculated 376 + 194 + 117 = MSEK 688. Adjusted EBITDA Earnings before interest, tax, depreciation, amortization, write-down, and amortization on acquisition-related surplus values, adjusted for items affecting comparability. Adjusted EBITDA margin is Adjusted EBITDA in relation to net sales. Adjusted EBITDA per share is Adjusted EBITDA divided by average number of shares before dilution. Adjusted EBITDA is one of the Group’s most important financial figures, internally and externally. The figure is used to identify and analyze the Group’s profitability linked to normal operations and operating activities. Adjusted EBITDA is calculated as 688 + 8 = MSEK 696. Adjusted EBITDA margin is calculated as 696 / 7,708 = 9%. Adjusted EBITDA per share is calculated as MSEK 696 / 445,113,429 = SEK 1.56. EBITA Earnings before interest, tax, amortization, write- down, and amortization on acquisition-related surplus values. EBITA-margin is EBITA in relation to net sales. EBITA is calculated 376 + 194 = MSEK 570. Adjusted EBITA Earnings before interest, tax, amortization, write- down, and amortization on acquisition-related surplus values, adjusted for items affecting comparability. Adjusted EBITA margin is Adjusted EBITA in relation to net sales. Adjusted EBITA per
Page 141
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 141 SUSTAINABILITY BUSINESS OVERVIEW CORPORATE GOVERNANCE ANNUAL REPORT share is Adjusted EBITA divided by average number of shares before dilution. Adjusted EBITA is calculated as 570 + 8 = MSEK 578. Adjusted EBITA margin is calculated as 578 / 7,708 = 8% Adjusted EBITA per share is calculated as MSEK 578 / 445,113,429 = SEK 1.30. Earnings per share after dilution Profit for the period after tax divided by the sum of the number of average outstanding shares plus the weighted average of additional shares that would have been outstanding upon conversion of all potential dilutive shares at the end of the period. No adjustment for dilution is made in the event of a loss reported. Net interest-bearing debt Total interest-bearing liabilities less cash and cash equivalents, plus tax deferral included, less short- term investments to be divested, less financial asset to associated company. Lease liability is not included. Net interest-bearing liabilities are the Group’s primary management parameter for financing and capital allocation and are actively employed as part of the Group’s financial risk management strategy. Net interest-bearing debt is calculated as 1,766 - 432 + 252 – 20 = MSEK 1,566. NIBD including earnout (net) is calculated as 1,566 + 129 =MSEK 1,695 Return on equity Profit after financial items in relation to equity. Return on equity is calculated as 161 / 5,221 = 3.1% Solvency Equity in relation to the balance sheet total. Solidity is calculated as 5,221 / 9,345 = 55.9%
Page 142
HUMBLE GROUP | ANNUAL AND SUSTAINABILITY REPORT 2024 142 SUSTAINABILITY BUSINESS OVERVIEW CORPORATE GOVERNANCE ANNUAL REPORT MULTI-YEAR SUMMARY 2024 2023 2022 2021 2020Net sales 7,708 7,050 4,800 1,486 29Gross profit 2,419 2,129 1,532 441 7Gross margin 31% 30% 32% 30% 24%EBITDA 688 659 504 -41 -30Adjusted EBITDA 696 617 551 233 -14EBITA 570 547 419 -66 -31Adjusted EBITA 578 505 466 208 -15EBIT 376 318 257 -118 -37Adjusted EBIT 384 276 304 156 -21Cash flow from operating activities 300 1,088 255 -152 -19Solvency (%) 55.9% 54.6% 45.6% 45.2% 68.8%ShareLow price (SEK) 8.58 5.94 9.01 12.60 1.05High price (SEK) 13.70 11.69 28.85 33.85 16.30Closing price previous period (SEK) 11.38 9.77 28.00 14.96 1.39Closing price current period (SEK) 12.45 11.38 9.77 28.00 14.96Share price development during period (%) 9% 16% -65% 87% 980%Trading volume in the share (MSEK) 1,656 1,748 4,223 7,226 1,162Number of transactions in the share 144,742 181,662 347,133 468,850 121,331Average volume per trading day (MSEK) 7 7 17 29 5Average volume per transaction (SEK) 11,441 9,621 12,166 15,412 9,580Number of shareholders* 18,121 20,670 24,080 21,615 6,678Number of shares outstanding* 446,575,533 443,544,543 301,274,580 246,977,667 122,233,439Average number of shares before dilution 445,113,429 377,360,692 284,151,901 184,674,887 85,078,415Average number of shares after dilution 445,113,429 383,219,322 286,818,625 186,009,474 86,408,283Net sales per share (SEK)** 17.32 18.68 16.89 8.05 0.35Adjusted EBITDA per share (SEK)** 1.56 1.63 1.94 1.26 -0.16Adjusted EBITA per share (SEK)** 1.30 1.34 1.64 1.13 -0.17Adjusted EBIT per share (SEK)** 0.86 0.73 1.07 0.84 -0.24EBIT per share (SEK)** 0.85 0.84 0.90 -0.64 -0.43Earnings per share before dilution (SEK) 0.28 -0.28 -0.13 -1.14 -0.45Earnings per share after dilution (SEK) 0.28 -0.28 -0.13 -1.14 -0.45* End of period, **Before dilution