Balance Sheet at 31 March 2018 71
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Annual Report 2017/18 1 April 2017 – 31 March 2018 KNI A/S CVR. No. 16 60 73 98 Contents Page Company details 3 Group overview 4 Business units 5 Board of directors and management 9 Management statement 14 Independent auditor’s report 15 Financial highlights and key figures for the Group 16 Facts about the financial year 17 Management report 19 Accounting policies 63 Profit and loss account 1 April 2017 - 31 March 2018 70 Balance sheet at 31 March 2018 71 Equity capital statement 73 Profit and loss account for the Group 1 April 2017 - 31 March 2018 74 Notes to the annual report 75 Segment accounts 85 2 Company information Company name: KNI A/S Subsidiary names: Pilersuisoq A/S (KNI A/S) Polaroil A/S (KNI A/S) Address: J. M. Jensenip Aqq. 2, Postbox 319 3911 Sisimiut Company reg. no. 16 60 73 98 Domicile: Qeqqata Municipality Tel. +299 86 24 44 Fax +299 86 23 96 E-mail [email protected] Website: www.kni.gl Shareholder: Government of Greenland, Postbox 1015, 3900 Nuuk - (ownership share: 100%) Auditors: Deloitte Certified Accountants 3 Group overview Affiliates: As of the balance sheet date, KNI A/S owns 100% of the shares in: Neqi A/S (share capital DKK 0.6 million) KNI Ejendomme A/S (share capital DKK 1.0 million). In addition, as of the balance sheet date, KNI A/S owns 82.5% of the shares in: Akia Sisimiut A/S (share capital DKK 3.0 million). Associated company: Pitsaasut ApS, in which the ownership share is 50% (share capital DKK 80,000). 4 Business units The KNI Group consists of four business units, all of which are managed and run on the basis of modern business principles. We supply all of Greenland with groceries, consumer goods and fuels. Polaroil – Greenland’s largest oil supply company As Greenland is a society undergoing rapid change, it is dependent on companies who are able – often under extreme conditions – to link the entire vast country together with deliveries of vital supplies. One of these companies is Polaroil, for whom the words safety and responsibility are deeply ingrained in both the company’s objects clause and in the minds of all its employees. Polaroil operates a total of 69 plants, divided between 16 oil terminals in the towns, 51 oil terminals and one depot in the villages, and one import plant. All of the towns and villages have storage facilities for lubricating oils and gases. Polaroil purchases, transports, stores, distributes and sells liquid fuels adapted to consumer needs and the environment – all year round, and for the whole of Greenland. The fuels involved are mainly gas oils, aircraft fuel, paraffin and petrol. It is also Polaroil’s task to secure stable prices for the Greenlandic fuel market and the lowest possible level of cost. Local distribution of liquid fuels in the towns is partly handled by Polaroil’s own organisation, and partly through agreements with local oil dealers. In the villages, this is handled by the company unit Pilersuisoq. Another of Polaroil’s business areas is to service the international companies who operate oil exploration and mining in Greenland. 5 Pilersuisoq – Greenland’s largest retail chain Pilersuisoq is a nationwide retail chain with 64 outlets scattered right across Greenland. From the northernmost to the southernmost shop, the distance is more than 2,000 km. The company also operates the duty-free shop chain at the international airport in Kangerlussuaq. Pilersuisoq secures supplies to everyone – even the smallest village. Deliveries are made by sea and air freight. In a country where many towns and villages are almost inaccessible for a large part of the year due to frozen fjords and harbours, this requires more than ordinary good planning. Efficient logistics and the ability to anticipate needs are therefore a high priority for the retail chain. In many places the local shop is the hub of village life, and the population is dependent on being able to obtain goods all year round – a task which is somewhat different to that of retail outlets elsewhere in the world, and a responsibility that Pilersuisoq does its utmost to live up to. In many places, in addition to retail sales, the company unit also provides a number of service functions, such as bank, post office, ship berthing, heliport, etc. In co-operation with customers and local representatives, a basis is secured for development and quality of life in the towns and villages where the Pilersuisoq shops are located. The people in the local community are those who know their own conditions and needs best, and those needs are not the same everywhere in Greenland. It is therefore important that there is local influence, taking account of both the wishes of the customers and local demographic, geographical and business conditions. Pilersuisoq aims to make its shops a positive focal point in the local community. All Pilersuisoq shops are equipped with a sales terminal, where you also can shop via www.Pisisa.gl. 6 KNI Engros – Trading with businesses and institutions throughout Greenland KNI Engros covers the whole of Greenland, as the company operates in both towns, villages and settlements, as well as in the area of ships’ supplies and ad hoc-established mineral exploration sites. By making use of extensive supplier networks and the purchasing volume of the KNI Group, supplies can be provided in virtually all types of product, tailored to the needs of the individual customer – and at competitive prices. KNI Engros sells and distributes all types of products to businesses and institutions throughout the country, and the company unit holds the contract for nationwide distribution of beer and carbonated drinks. In close dialogue with its customers, KNI Engros aims to be the preferred wholesale supplier in Greenland, with easy access to our ordering system and smooth and efficient deliveries directly to the customer. 7 Neqi A/S – Slaughterhouse in South Greenland Every year, the KNI A/S subsidiary Neqi A/S receives sheep and lambs from more than 38 sheep farms scattered throughout South Greenland. In 2017, Neqi A/S slaughtered 20,569 lambs and sheep. In 2013 Neqi A/S underwent refurbishment for DKK 60 million kroner, and today it is a modern, EU-approved slaughterhouse. The modernised production equipment has enabled the slaughterhouse to increase its degree of processing, and in dialogue with the retail chains Pilersuisoq, Brugsen and Pisiffik A/S, further development is continually being pursued. Neqi A/S wishes to be a valuable partner in the development of the agricultural industry. The company sees great potential in developing a stronger agricultural sector, involving not only sheep, but also cattle and the cultivation of root crops. Neqi A/S is also known for its great efforts to ensure the high quality and fine taste of Neqi lamb. Production in Neqi A/S takes place under extra-hygienic conditions. Quality, fat content and tenderness are continuously monitored, and veterinary inspectors supervise and approve all processes. Neqi A/S currently employs around 80 people during the slaughtering period, which lasts approximately eleven weeks, starting in mid-September. Outside the season, Neqi A/S has approximately 25 employees. The employees from Narsaq and the surrounding towns are highly motivated in their work, and thereby contribute to creating a seed-bed for long-term development of the slaughtering process. 8 Board of directors and management Board of directors: Høgni Hansen (b. 1961) Chairman of the board of directors (appointed by the Government of Greenland) since 2018. In the period 2014 to 2018, he was Deputy Chairman of the board of directors. Educational background: Commercial training. Current career: Managing director/CEO, P/F Poul Hansen. Also holds other directorships in companies in the Faroe Islands. Competencies: Experienced in operations, organisation and business development, strategy formation and implementation. Possesses a good knowledge of the retail and meat industries. Najaaraq Christiansen (b. 1982). Vice-Chairman of the board of directors (appointed by the other members of the board) since 2018. Board member from 2016 to 2018. Educational background: Graduate Diploma in Business Administration – accounting and financial management. Current career: Chief consultant with national accounts. Competencies: Experienced in work with finance and statistics. 9 Bodil Nyboe Andersen (b. 1940) Member of the board of directors (appointed by the Government of Greenland) since 2014. Educational background: MA (Political Science) and former director of the National Bank. Current career: Holds other directorships in Denmark. Competencies: International top management in the financial sector, and board positions. Also possesses extensive experience in strategy and organisation. Annette K. Sadolin (b. 1947) Member of the board of directors (appointed by the Government of Greenland) since 2014. Educational background: LLM Current career: Holds other directorships in large companies in Denmark. Competencies: International top management, and board positions in large companies. Also possesses extensive experience in strategy, organisation and personnel matters, legal matters, risk management, and sales and marketing. 10 Søren Jakobsen (b. 1963) Member of the board of directors (appointed by the Government of Greenland) since 2016. Educational background: MSc (Economics and Business Administration) and MBA. Current career: Board work and consulting. Competencies: Extensive experience in senior management, strategy, business development and sales. Mikol Poulsen (b. 1975) Member of the board of directors (staff representative) since 2015. Educational background: College degree in Leadership and Management, and Arctic Top Governance diploma in board work. Current career: HRD Manager in KNI A/S Competencies: Experienced in work with organisation and training. 11 Dorthea Isaksen (b. 1971) Board member (staff representative) since 2015. Educational background: Qualified therapist, JTI testing certificate and Master Class in HRM. Current career: HRD Manager in KNI A/S Competencies: Experienced in work with organisation and training.