Another very difficult year I
n the last few years, our financial performance has been affected by a number of cases which have obviously taken a toll on our reputation, our business and our employees. Unfortunately, 2020 was no exception, which – combined with the fact that our operations faced difficulties in some parts of the business, in part because of COVID-19 – makes 2020 a year we will remember as very challenging. Values overstated We recorded a net loss for the year of DKK 408 million, which is primarily due to impairment of non-current assets of DKK 307 million in Verdo Varme A/S and Verdo Produktion A/S. The plant values recognised in the regulatory accounts of the two companies turned out to be too high, and the Danish Utility Regulator has estimated that the values of our plant assets
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Annual report 2020
in Verdo Varme A/S and Verdo Produktion A/S were overstated more than 10 years ago. Technically, this means that the value of our regulatory plants must be impaired by DKK 307 million. The adjustment impacts the financial statements by DKK 217 million as we made a provision of DKK 90 million in 2019, reducing the results by a similar amount. Even after the impairment, there are positive depreciation bases in both Verdo Varme A/S and Verdo Produktion A/S, and, consequently, there will be no repayments as we have seen in other cases in previous years. The case’s negative impact on our financial statements is of course very regrettable – not least because it dates back decades – but we believe our handling of the case is a step towards a better dialogue and increased transparency in relation to the authorities, our customers and society in general. We are on the right
track and are continuously taking steps to address issues that could damage our business and our reputation. Unexpected turns on our path Every year, we face unexpected challenges and turns on our path. In 2020, however, these challenges were bigger and more volatile than our forecasts and budgets were able to predict – in part because of COVID-19 and the weather. Throughout 2020, operations were challenged by high temperatures and large fluctuations in commodity and electricity prices, which had a negative impact on our bottom line. COVID-19 affected us financially in several ways. Our sales in several business areas were hurt by the pandemic as decision-making processes became longer and customers put their purchasing decisions on hold. These factors had
