Management's review
Beskrivelse af virksomhedens væsentligste aktiviteter:Primary activities
The company’s activities are the development and sale of branded fishing tackle and related products.
The company’s products are sold through an extensive network of retailers throughout Europe. The company also sells products in the UK and North America, primarily via related companies within the Pure Fishing Inc. group of companies.
The company develops products inhouse but also benefits from product development activities lead by Pure Fishing Inc. Sourcing, sales and marketing similarly benefit from the resources of the Pure Fishing group of companies within Europe.
Products are manufactured by third party suppliers, mainly from the Far East.
In terms of corporate social responsibilities, there are limited risks. The most material risk relates to the long transportation distances and the corresponding CO2 impact.
Development in activities and finances
During 2022, the demand for the company’s product has stabilized after a significant increase in 2021. However, the commercial strength of the brand and products continues to underpin strong retail demand across key markets.
The acquisition of the company by Pure Fishing in 2022 has provided extra support for product development, sourcing, and sales. This has allowed the company to be more resilient to changes in the market.
Development in the number of employees The Company had 175 employees at the beginning of the year and during the year had a net outflow of 10 employees. The Pure Fishing Group, including Svendsen Sport A/S, has on-going recruitment activities to partly restore employee numbers to sustain the commercial strength of the business and support the route to market through sales activities.
Profit/loss for the year in relation to expected development
The income statement of the Company for 2022 shows a profit of TDKK 46,709, and on 31 December 2022 the balance sheet of the Company shows an equity of TDKK 193,390.
The Company's revenue for the year amounted to DKK 512. 0 million, compared to last year when revenue amounted to DKK 641. 1 million.
Economic conditions in the key markets have been challenging and the business sector has seen a decline in retail sales in line with general market conditions. This largely explains a reduction in turnover compared to last year.
Proot before tax amounted to DKK 56. 2 million.
The net result reflects the reduction in sales but also a strategy to maintain marketing and product development expenditure to ensure the company remains well placed to address future competitive challenges.
Uncertainty relating to recognition and measurement.
Recognition and measurement in the Annual Report have not been subject to any uncertainty. However, some measurements are based on judgements or assumptions as certain items in financial statements by their nature cannot be measured with precision.
Unusual circumstances affecting recognition and measurement
The financial position on 31 December 2022 of the Company and the results of the activities and cash flows for the fnancial year for 2022 have not been affected by any unusual events. Following the Russian invasion of Ukraine in March 2022, the Company has ceased its business with Russia. The open sales orders to Russian customers have been cancelled. At the same time the Company has accrued for potential bad debt from customers in Russia, customers in countries where the currency is linked to the Russian Rubel, and Ukraine. This event has not materially changed the sales for 2022.
Outlook
The Company and Pure Fishing Group aim to develop its sales and market share through continual product innovation and development. The management team are confident that adequate resources will be available to support business development into the future years.
Use of financial instruments
Foreign exchange risks The Company has a high international activity and is therefore exposed and vulnerable to exchange rate fluctuations primarily in US dollars vs. DKK. Following the change in ownership, the company has decided not to hedge any currency exposures from February 2022. As the products are sold on different European markets, the Company is also to a minor extent exposed to fluctuations in other European currencies vs. DKK. The main part of the transactions in foreign currencies is denominated in EUR, which is not hedged due to Denmark's fixed exchange rate policy vis-a-vis the Euro. Transactions in other currencies are in accordance with the Company’s policies as per the above.
Interest rate risks In relation to its credit facility, the Company is subject to an interest rate risk. The interest rate exposure is related to fluctuations in the CIBOR rate. The Company is not hedging its interest exposure.
Credit risks The Company's customers comprise a wide range of retailers in Europe and the US. The maximum credit risk that may occur for trade receivables and other receivables corresponds to the value at which they are recognized in the balance sheet. No single receivable constitutes a significant part.
Risks connected to capital structure. The Company has a solid balance sheet with an equity ratio above 32. 8 % and a liquidity ratio above 1. The Company is only to a minor extend dependent on support from the mother company. Therefore, the Management døs not see any special risks connected to the capital structure.
Knowledge resources
The Company possesses extensive knowledge of product development. Retention and development of competencies in the development department is of major importance for continued growth and earnings.
Research and development activities
The Company’s development activities include functional development and design of fishing tackle, including lures, rods, reels as well as clothing and other accessories.
Statutory report on corporate social responsibility
Statement of corporate social responsibility is in accordance with the Danish Financial Statement Act §99 a. For a description of the business model, please refer to the separate section above.
UN Global compact In its policy for “Business Principles and Corporate Social Responsibility”, the Company subscribes to UN Global Compact. From this starting point, the Company has selected four key and relevant UN Sustainable Development Goals (hereafter referred to as “Goal(s)”), where it tracks performance: • Goal no. 7: Affordable and clean energy • Goal no. 8: Decent work and Economic Growth • Goal no. 9: Industry innovation and infrastructure • Goal no. 12: Responsible consumption and production
The performance is described in the relevant sections below. Supplier Code of Conduct The UN Global Compact principles are also the guidance for the Supplier Code of Conduct that the Company developed during 2020. The Supplier Code of Conduct describes how the suppliers should deal with:
• Human Rights and Labor standards o Employment is freely chosen, o There is no discrimination in employment, o No exploitation of child labor, o Freedom of association and the right to collective bargaining, o Payment of a living wage, o Working hours, o Decent working conditions, o Legally binding employment relationship, o Fire safety,
• Environmental Standards o Conditions outside the workplace, o Emissions to air, water, and ground, o Waste management, o Chemicals management in the factory, o Records and provision of information, o Procedure for chemical management, o Employee information and training, o Labelling of chemicals, o Storage and handling of chemicals, o Disposal of chemicals,
• Anti-Corruption
The purpose of the Supplier Code of Conduct is to mitigate the risk of Human Rights and Anti-Corruption violation with the external suppliers. In addition, the purpose is to reduce the environmental impact from external suppliers. The company considers the mentioned risks to be the most material in the entire supply chain due to the geographical location of the suppliers and is consequently developing the supplier management accordingly.
Environment and Climate Apart from the possible impact from the Suppliers that is mitigated through the Supplier Code of Conduct program, there is a major environmental impact coming from the transportation of products from primarily Chinese suppliers to the markets in Europe. The company strives to transport as much as possible using ships to reduce the carbon footprint. Moving the supply closer to the European markets is a very difficult process, as there is a very limited supplier base in Europe.
In addition to inbound transportation, there is a major emission impact from outbound transportation. The company considers that the location of the central warehouse is the most optimal both from a financial and from an environmental perspective.
The company will continuously improve processes to minimize the environmental impact of its own operation. For its own operation, most of the energy is consumed in the central warehouse. According to Goal no. 7, the Company measures kWh spent in the warehouse per 1,000 DKK of Cost of Goods Sold (hereafter COGS) during the warehouse.
Due to the Company’s diverse product portfolio, it is impossible to find a uniform measurement for the volume except for the COGS. The reader must understand that the KPI can be misleading to the extent that the COGS is inflated by price increases and is impacted by the development of exchange rates vs. DKK.
The company has together with the landlord invested in more energy efficient lightning during the last couple of years.
To track the development of Goal no. 9 and Goal no. 12, the Company tracks the amount of waste in central warehouse in relation to COGS. All waste fragments are recycled. The recycling company of cardboard waste has not been able to provide data.
The company will continue the work to reduce the relative energy consumption and relative waste production in the warehouse.
The company is aware of it’s environmental obligations and aims to reduce the environmental impact of it’s operations and products. Energy consumption and waste products are actively recorded to monitor and aim to minimize environmental impact.
Human rights and social & employee conditions Respect for human rights is fundamental. This gøs for the company’s employees as well as the communities the company lives and operates in. The CSR policy is described in the employee handbook, which is given to new employees upon employment.
• The company supports and respects the protection of internationally proclaimed human rights, • The company will ensure that we are not complicit in human rights abuse in any of our operations, • The company will uphold the freedom of association and the effective recognition of the rights to collective bargaining, • The company will not use any form of forced or compulsory labor, • The company will support the elimination of direct and indirect discrimination in respect of employment and occupation, including race, color, sex, religion, political opinion and nationality or social origin, • The company will continuously develop employees' competencies and flexibility and will provide safe and healthy working conditions.
The key risk in terms of human rights, social and employee conditions lies with the subcontractors. Consequently, the Company works with its Code of Conduct as described above.
The company offers their employees an opportunity for further training by offering courses to help develop their competencies. In addition, the company is rolling out an employee assessment to strengthen the career development and possibilities of all employees.
The company’s main risk for social and employee conditions lies in maintaining that employees have the proper skills to maintain their job and create value for the Company. The Company døs not see any other specific, material risks to violating human rights, apart from what is described under the Supplier Code of Conduct.
The company has made enquiries of its suppliers and customers in the normal course of business. The company has not discovered any breach of human rights during 2022 as a result of these enquiries.
The Pure Fishing group of companies conducts regular surveys with all of it’s employees, including those of Svendsen Sport A/S. The most recent survey was conducted in June 2023. The results of the survey were largely supportive of the company. The company has recently invested in new business premises. One objective was to provide an up to date and comfortable working environment for its employees
In the coming financial year FY23 we will continue to further the current initiatives and reassess our actions within the area of human rights.
Going forward we will continue to invest in developing and upskilling the competencies of our workforce.
The two tables above show how the mentioned KPI’s were demonstrated in the last report. Similar output (with this year’s financial data) would be sufficient for this point.
Anticorruption All the company’s employees are informed, when employed, that conduct of unethical, dishonest behavior and bribery is not tolerated.
• The company will conduct its business with high ethical standards, honesty, and respect for other, • The company will be compliant with the laws and regulations in the countries where we are present, • Neither the company nor its employees will offer, promise, give and/or accept a bribe for business purposes, • Neither the company nor the employees will be involved in non-competition activities i. e., illegal price fixing, sharing of customers and markets.
The company’s risks related to anti-corruption and bribery are mainly present within our own operation and with our collaboration partners. The anticorruption topic within suppliers is handled in the Supplier Code of Conduct program.
The company has not discovered any breach of anti-corruption or bribery in 2022. In 2023, the company will establish a whistleblower scheme according to legislation.
Statutory report on the underrepresented gender
The Company strives to maintain and fulfill the goals set for gender quotation at all management levels but will always employ the best qualified candidate. The Company believes that diversity among employees contributes positively to the working environment and strengthens the Company's performance and competitiveness. The Company’s policy is to always provide equal job opportunities regardless of gender. The Company’s target figure for the proportion of underrepresented gender among members of the Management is 10 % in 2023. The reader should be aware that that only 10-12 % of the anglers are women according to information from Danmarks Sportsfiskerforbund. This will impact the gender composition of the recruiting base for the positions that require knowledge about angling.
The proportion of underrepresented gender among the Management was 0%, end of 2022. During 2022 managerial positions were replaced, but consequently there is no development in the figure. However, the company is rolling out an employee assessment to strengthen the career development and possibilities of all employees. By applying the assessment process and by focusing on diversity during recruitment, the company expects to reach the target above.
According to legislation on the gender quotation on the board of directors in Danish enterprises, the Company has selected a target for the underrepresented gender among member of the Board of 20%. The proportion of the underrepresented gender among the board was 0 %, end of 2022. The Company will work focused towards identifying the possibility of fulfilling the policy and target before the general assembly in 2025.
Statutory report on data ethics policy
The company takes its responsibility as data controller seriously, as the company wants to be perceived as a respected, competent and proper business partner, who complies with applicable legislation and follows developments in good data ethics.
Therefore, we have a dedicated team to handle GDPR requirements as well as a strong IT department to operate and improve data security. Those teams work closely together with management to secure full transparency and to have the proper authority over the rest of the organization. The daily work with data ethics also takes place in the company's relevant business departments.
Besides securing the basic rights for data subjects, awareness and education campaigns are held, all of which are tailored to the work of the employees. These initiatives apply to both new and existing employees so that understanding and competencies are maintained.
Moreover, stringent deletion procedures are in place so that data is deleted when it is no longer necessary for the company to store.
The company’s employees and customers have the right to request access and to obtain certain insights into their personal data. To ensure data subject’s self-determination over the data the company stores, the company works continuously to ensure that data is processed as structured as possible to always have an overview of what data we store and process about the individuals.
In addition to the relationships with customers, the company has a wide range of contacts worldwide. Therefore, the company is aware that it also has a broader responsibility when it comes to ethically correct data processing.
If there is a need to share or transfer data to other entities or countries, data processing agreements with those relevant third parties are in place to ensure that data is properly safeguarded.
It is essential for the company that its customers and other stakeholders can have confidence in the company’s ethical stance in terms of processing data. Consequently, the company will continue to work with data ethics and improving the approach to data management and security even more, in the coming year.
Statutory report on corporate governance
Ownership On 1st February 2022, the company was sold to Pure Fishing Inc, where Sycamore Partners is the ultimately owners.
Presentation of the Board of Directors Pure Fishing Inc is represented on the board by Kevin Michal Jayson, Gareth Lindsay Moore, and Kjell Harry Clefjord. Board positions and other managerial positions are set out below.
Kevin Michæl Jayson
Kevin Michal Jayson joined as board member on 1st February 2022. He holds the following other directorships: •Director of: o Plano Synergy Holding Inc. , o Frabill, Inc. , o Abu Garcia Pty Ltd. , o Shakespeare (Australia) Pty Ltd. , o Outdoor Technologies (Canada) Co. , o Jia Dun Sports Equipment Co. , Ltd. , o Mao Ming Passion Sports Company Limited, o Pure Fishing (Guangzhou) Business Services Co. Ltd. , o OTG-Cani Denmark A/S, o MIE4 Datter ApS, o Svendsen Sport A/S, o Pure Fishing Finland OY, o Pure Fishing Spirit HK Limited, o Pure Fishing (Hong Kong) Co. Limited, o Pure Fishing Japan Co. , Ltd. , o Pure Fishing Korea Co. , Ltd. , o Pure Fishing Malaysia Sdn. Bhd. , o Pure Fishing (NZ) Limited, o Pure Fishing Norway AS, o Pure Fishing Poland Sp. z o. o. o Outdoor Technologies Group Sweden AB, o Abu Garcia AB, o Abu AB, o Pure Fishing Spirit UK Limited, o Shakespeare International Limited, o Pure Fishing (UK) Limited, o Hardy & Greys Limited, o Hardy Advanced Composites Limited, o Outdoor Technologies Corporation, o Pure Fishing Inc. , o Sea Striker, LLC, o Penn Fishing Tackle Mfg. Co. , and o Shakespeare All Star Acquisition LLC
• Officer of: o Plano Synergy Holding Inc. , o Plano Holding LLC, o Plano Molding Company, LLC, o HHS IP, LLC, o Frabill, Inc. , o PSV II, LLC, o PJJL, LLC, o 431 East South LLC, o Abu Garcia Pty Ltd. , o Shakespeare (Australia) Pty Ltd. , o Outdoor Technologies (Canada) Co. , o SP PF Parent Corporation, o SP PF Intermediate Corporation, o SP PF Buyer LLC, o Outdoor Technologies Corporation, o Pure Fishing Inc. , o Sea Striker, LLC, o Penn Fishing Tackle Mfg. Co. , and o Shakespeare All Star Acquisition LLC,
Gareth Lindsay Moore
Gareth Lindsay Moore joined as board member 1st February 2022. He holds the following other directorships:. •Director of: o Plano Synergy Holding Inc. , o Frabill, Inc. , o Abu Garcia Pty Ltd. , o Shakespeare (Australia) Pty Ltd. , o Outdoor Technologies (Canada) Co. , o Jia Dun Sports Equipment Co. , Ltd. , o Mao Ming Passion Sports Company Limited, o Pure Fishing (Guangzhou) Business Services Co. Ltd. , o OTG-Cani Denmark A/S, o MIE4 Datter ApS, o Svendsen Sport A/S, o Pure Fishing Finland OY, o Pure Fishing Deutschland GmbH, o Pure Fishing Spirit HK Limited, o Pure Fishing (Hong Kong) Co. Limited, o Pure Fishing Japan Co. , Ltd. , o Pure Fishing Korea Co. , Ltd. , o Pure Fishing Malaysia Sdn. Bhd. , o Pure Fishing Netherlands B. V., o Pure Fishing Spirit B. V., o Pure Fishing (NZ) Limited, o Pure Fishing Norway AS, o Pure Fishing Poland Sp. z o. o., o Outdoor Technologies Group Sweden AB, o Abu Garcia AB, o Abu AB, o Pure Fishing Spirit UK Limited, o Shakespeare International Limited, o Pure Fishing (UK) Limited, o Hardy & Greys Limited, o Hardy Advanced Composites Limited, o Outdoor Technologies Corporation, o Pure Fishing Inc. , o Sea Striker, LLC, o Penn Fishing Tackle Mfg. Co. , and o Shakespeare All Star Acquisition LLC
• Officer of: o Plano Synergy Holding Inc. , o Plano Holding LLC, o Plano Molding Company, LLC, o HHS IP, LLC, o Frabill, Inc. , o PSV II, LLC, o PJJL, LLC, o 431 East South LLC, o Abu Garcia Pty Ltd. , o Shakespeare (Australia) Pty Ltd. , o Outdoor Technologies (Canada) Co. , o SP PF Parent Corporation, o SP PF Intermediate Corporation, o SP PF Buyer LLC, o Outdoor Technologies Corporation, o Pure Fishing Inc. , o Sea Striker, LLC, o Penn Fishing Tackle Mfg. Co. , and o Shakespeare All Star Acquisition LLC
Kjell Harry Clefjord
Kjell Harry Clefjord joined the board 1st February 2022. He holds the following other directorships: • Managing director of: o Pure Fishing Finland OY o Pure Fishing Deutschland GmbH
• Chairman of: o Pure Fishing Norway AS o Outdoor Technologies Group Sweden AB o Abu Garcia AB o Abu AB
• Director of: o Pure Fishing Finland OY o SP Pure Fishing UK Limited o SP Pure Fishing UK Buyer Limited o Pure Fishing Spirit UK Limited o Shakespeare International Limited o Pure Fishing (UK) Limited o Hardy & Greys Limited o Hardy Advanced Composites Limited
Events after the balance sheet date
No events that will have a material impact on the assessment of the Annual Report have occurred after the balance sheet date.
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