Jotul Holdings SA Société anonyme Registered office: 6, Rue Eugène Ruppert R.C.S. Luxembourg: B 203258 (the “Company”) REPORT OF THE BOARD OF DIRECTORS Financial year ended on December 31, 2020 (the “ Financial Year ”) Dear Sirs, We herewith submit to you the annual accounts of the Company for the Financial Year in accordance with the Luxembourg law dated 19 December 2002 on the Luxembourg Trade and Company Register, accounting and annual accounts (“Loi du 19 décembre 2002 concernant le registre du commerce et des sociétés ainsi que la comptabilité et les comptes annuels des entreprises ”) as amended from time to time. Introduction The Company was incorporated on December 22, 2015 and holds participation in Jøtul AS, a Norwegian group specialising in the manufacturing and distribution of fireplaces. The group is one of three largest suppliers of fireplaces in Europe and a significant player in North America. The products are sold through one of the most wide-reaching global networks in the industry, consisting of own sales companies and distributors. The products reach the end consumers through specialty shops, and in Norway also through building materials retail chains. Business performance and results Total assets of the Company amount to MNOK 330 (2019: MNOK 392,7) and the Company has made a loss of MNOK -127,2 (2019: MNOK -112,5). The loss is mainly due to an impairment recorded on the investment value of Jøtul AS for an amount of MNOK -109,1 (2019: MNOK -102,1). In the Board’s opinion, the annual accounts provide a fair view of the C ompany’s financial position and results. The Company has established a strategy for post COVID-19, which will ensure the basis for continued growth. As disclosed by management under Note 2.2.1 of the financial statements, the coronavirus continues to impact the performance and health of the Company and its investments. Management indicates that it is currently not possible for them to properly estimate the impact of the coronavirus on the financial performance of the Company and its investments. The Board confirms that the going concern assumption is valid while a material uncertainty exists associated to the outcome of the refinancing process of the senior secure bond which is dependent among other factors on market condition, intention and ability of the bondholders to refinance, which is by nature, inherently uncertain as of the day of approval of these accounts, because, indicated above, the Company is expecting to initiate the process in the second half of 2021. With the current investment’s performance and the favourable business outlook it is the board of directors’ expectations that the Company will have adequate resources to continue trading for the foreseeable future. Future development The Company intends to continue in its current activity. As disclosed in Note 2.2.1, the senior secured bond issued by the Company is going to maturity in January 2022. The Company’s strategy is to start refinancing process during the second half of 2021. The Company believes the timing for a re-financing is favourable given the liquidity in the bond market and the favourable customer demand for Jotul products in the markets in which the Company’s investment operates.
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