Rosendahl Design Group A/S Annual Report 2023 • Management’s Review Financial Risks Rosendahl Design Group’s financial risks include interest and exchange rate risks. Manufacturing and distribution of consumer products through wholesale and retail trade is a liquidity-intensive industry, as most of the raw material and manufactured goods purchases are to be ordered well in advance and paid with short payment terms, while the customer side is characterised by normal and often long payment terms. Rosendahl Design Group forecast to have sufficient credit facilities that can accommodate the fluctuations that occur in day-to-day operations and the seasonal peaks, and that within these facilities Rosendahl Design Group has sufficient reserves to account for unforeseen liquidity needs. Production and procurement takes place primarily outside of Denmark, and a signifi - cant part of the company group’s turnover is export generated and settled in foreign currencies. Thus, the company is exposed to ongoing fluctuations in exchange rates, which impact both profit and cash flows. The currently unstable situation in large parts of the world, causing shipping routes to change and delays in deliveries, may influence the stability of our supply chain. It calls for an agile and robust supply chain suited to counter the fluctuations in logistics. The unstable financial situation in our home markets increase the risk of losses on debtors. The company pursues a strict policy and has appropriate processes in place to mitigate that risk to the best of our abilities. Ongoing hedging is carried out to limit risks on currency fluctuations. Macroeconomic trends in 2024 are still expected to cause significant fluctuations in currencies to which the company is exposed, as has been the case the previous years. The com- pany’s risks and uncertainties are expected to remain on the same level as in 2023 despite ongoing hedging, influencing both profit and cash flow. Events after the balance sheet date No subsequent events have occurred that affect the annual report for 2023. 21
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