K/S af 11.1.2024 III

INTRODUCTION — HEARTLAND is a family-owned company focused on creating lasting value and making a positive impact. Guided by a passion for progress and innovation, we act with genuine commitment, fostering long-term relationships as a cornerstone of our strategy. Being family-owned enables us to avoid short-term compromises, al- lowing us to focus on transforming promising ideas into meaningful ven- tures while safeguarding enduring value. While our origins lie in the fashion industry, our portfolio now extend across a wide range of industries.We embrace diversity in our portfolio, prioritising the right ideas, values, and mindset. Our team places the utmost impor- tance on trust, integrity, and mutual respect – and we hold our partners to the same standards.Together, we take responsibility not just for our busi- ness, but also for the environment, our communities, and everyone with whom we collaborate. This report highlights HEART- LAND’s financial performance for the financial year from 1 August 2024 to 31 July 2025. It also showcases our ongoing sustainability initiatives, across our portfolio, along with key milestones from our largest majority- owned companies. “At HEARTLAND, we act with heart and a steadfast belief in people, forging lasting partnerships founded on trust and mutual respect.” Anders Holch Povlsen Founder and Chair of the Board, HEARTLAND nationally. This past year has been marked by new initiatives that rein- force our long-term commitment to protecting and restoring nature. In the coming years, this will remain a key priority, with significant invest- ments. CEO LETTER — Looking ahead, we remain stead- fast in our commitment to creating long-term value – both financially and within the communities and en- vironments we are part of. We will continue to invest with passionate determination, driven by our belief in the people, businesses, and ideas that shape our portfolio. We are pleased with this year’s financial performance, which surpasses expecta- tions both on top and bottom line. While global uncertainty is expected to persist, we view the results as a founda- tion for continued progress. The financial year 2024/25 has been one of progress for HEARTLAND. We increased our revenue to DKK 64.4 billion, up from DKK 57.3 bil- lion the previous year, with a profit before tax of DKK 6.4 billion, up from DKK 4.0 billion the previous year. It is encouraging to see this positive momentum, as it reflects the contin- ued development of the companies we invest in and collaborate with. However, while we have seen im- provements in several markets, some of our partners continue to face chal- lenges, as has been the case in recent years. Many businesses are adjusting to a new reality where competition and market conditions continue to For 2025/26, we anticipate further progress, as both BESTSELLER and NORMAL are expected to continue their positive momentum. Our accounts will also reflect a positive contribution from the partial sale of shares in Klarna connected to the company's IPO. Overall,we expect single-digit growth in revenue and a profit before tax between DKK 7 and 8 billion. Lise Kaae CEO, HEARTLAND evolve. This also affects the compa- nies in our portfolio, each of which is undergoing necessary, and at times demanding, transitions. As a family-owned investor, we have the possibility to act with both pa- tience and agility – making decisions that serve our companies well in the moment and in the long run. Strong performance and continued investment This year, our results were positively influenced by solid earnings from key companies, including BESTSELLER and NORMAL, both of which con- tinued to grow their revenue. We are pleased with these results and the progress they reflect, as we know they are connected to the value our companies help create in the com- munities we are part of. Across our portfolio, our businesses contribute to jobs, local economic activity, and tax revenues, which support societal development. Our results are the foundation that enables us to con- tinue making a positive contribution. Beyond our financial investments, HEARTLAND remains committed to nature conservation and land stew- ardship.We are actively engaged in a number of environmental and preser- vation projects, as well as significant investments in land and agricultural INVESTING FROM THE HEART — At HEARTLAND, we have the opportunities to make a meaningful impact. Through our foundation and investments, we contribute to economic value creation – both directly and indirectly – by generating jobs, paying taxes, fostering business development, and supporting innovative solutions essential for the green transition. Even amid global uncertainty, our dedication to long-term investment remains steadfast and unwavering. Our portfolio is intentionally diverse. While our roots are firmly planted in the fashion industry, and this re- mains a key area of focus, we have strategically expanded into a variety of other sectors, including fintech, renewable energy, and fast-moving consumer goods. In pursue of sus- tainable, long-term value, we priori- tise founder-led partnerships and are prepared to make bold decisions to aid the innovations and the founders we work with. At HEARTLAND, we see ourselves as stewards of both our natural and cultural heritage, with a deep com- mitment to preservation and safe- guarding. Environmental protection and an understanding of needed changes is fundamental to our ap- proach, and we encourage our port- folio companies to actively minimise their environmental footprint. Our subsidiary, Wildland, leads our efforts to restore and conserve natural habitats across Europe and Africa, fostering biodiversity and safeguarding ecosystems for future generations. Similarly, through our property development arm, AAA United, we combine a passion for cultural heritage, architecture, and shared landmarks, dedicating our- selves to preserving and restoring his- toric architectural treasures, ensuring they are protected and celebrated alongside the natural world. When engaging in new construction, we strive to build buildings that meet the highest standards in design, opera- tion, sustainability, and aesthetics. (Learn more on page 22.) INVESTMENT HIGHLIGHTS — Investing in Nature and Land Throughout the year, we acquired several nature reserves, forests, and plots of land with the aim of preserving and restoring fauna and wildlife.These initiatives have notably taken place in Jutland, Denmark, complementing our ongoing efforts in Denmark, Scotland, Africa, and Romania. Read more on page 22. Zalando and ABOUT YOU In 2024/25, Zalando announced a public tender offer to acquire all outstanding shares in ABOUTYOU.The offer was ac- cepted by the shareholders. Upon approval and completion of this process, HEART- LAND disposed its position in ABOUT YOU. The successful exit from ABOUTYOU contributed positively to HEARTLAND’s financial result for the year. Preserving heritage with a focus on architecture AAA United, a property and design-fo- cused company, works with passion to revitalise historical buildings and create remarkable architectural landmarks. Throughout 2024/25, the company has invested in several restoration and de- velopment projects, combining respect for heritage with a commitment to quality and design excellence. Retail Expansions NORMAL and BESTSELLER have invested considerably and continued their retail expansion, a strategic priority for both companies. In 2024/25 NORMAL opened 145 new stores bringing them to 921 stores end of the financial year, while BESTSELLER opened 358 stores - they now have 3.100 stores globally. Partnering with ASOS on Topshop and Topman Joining forces in a joint venture, ASOS and HEARTLAND have partnered on the high-street legacy brands Topshop and Topman.The brands are now owned and operated under this partnership, with HEARTLAND holding a 75 percent stake. 2006 E-commerce goes live A new chapter in our digital journey begins with the launch of our own e-commerce. Eight years later, we open the first e-com- merce office in Amsterdam. 1975 First store Our founders, Troels Holch Povlsen and Merete Bech Povlsen, open their first fashion store, Pigalle, in the Danish town of Ringkøbing. 1987 International expansion Norway becomes the first BESTSELLER market outside Denmark, paving the way for JACK & JONES and VERO MODA. 1988 First sourcing office Our global sourcing setup begins to take shape as we start importing clothes from India and China and open our first sourc- ing office, located in Hong Kong. 1988 Headquarters in Brande Inspired by Italian architecture, construc- tion of our headquarters in Denmark now begins, with Building 0 as the first complet- ed project. 1990 Digitising our business From phone calls to hand-written orders, the first steps towards digitalisation start with BestInfo – our first digital tool. 2000 25-year anniversary As BESTSELLER turns 25, the cele- brations culminate with a big party in Copenhagen for colleagues, partners, and suppliers. 2015 BESTSELLER FOUNDATION Continuing years of charitable work, we now establish BESTSELLER FOUNDA- TION to drive further social and environ- mental impact. 2001 Generational handover Anders Holch Povlsen follows in his father’s footsteps and becomes CEO and Own- er, ensuring our legacy as a familyowned company. 2018 Fashion FWD Building on the early work of our Code of Conduct, a sustainability strategy launches with science-based targets on climate impact, alongside goals for materials and supply chain practices. 2017 HEARTLAND HEARTLAND was founded as the fami- ly-owned company in which BESTSELLER resides. 2022 Brands reach first billion JACK & JONES and ONLY BRAND HOUSE both achieve a record-breaking turnover of EUR 1 billion. 2021 Powered by the sun A 207-megawatt solar park established by HEARTLAND now connects to the European energy grid, covering the energy consumption with renewable energy. 2025 Biggest logistics investment We move one step closer to finalising our biggest investment yet by breaking ground on the upcoming Logistics Centre West, located in the Netherlands. STEWARDSHIP OF NATURE AND CULTURAL HERITAGE At HEARTLAND, we aim to be stewards of both the natural world and the cultural heritage that enriches our lives. We believe that true sustainability is rooted in careful preservation and respect for the environment, alongside a commitment to protecting historical landmarks that represent a shared history and are important part of cities and to their inhabitants. One of the key ways in which we contribute to this commitment is through our subsidiary,Wildland, which leads our efforts to restore and protect natural hab- itats across Europe and Africa. Our focus is on fostering biodiversity and rewil- ding efforts, ensuring that ecosystems are protected and that wildlife thrives for generations to come. Wildland’s work is vital in restoring the balance of nature, creating environments where both wildlife and communities can flourish. In Denmark, we have in recent years also added to our engagement through our subsidiary, Constantinsborg, which has acquired several nature reserves, forests, and plots of land with the aim of restoring nature. Nature initiatives HEARTLAND is engaged in several nature initiatives – including one here in the western part of Aarhus, Denmark, focused on restoring and strengthening biodiversity. Domkirkepladsen 1 A careful restoration of the historic former National Bank building in Aarhus is set to begin. Once complet- ed, it is expected to become the new headquarters for HEARTLAND. In addition to our environmental initiatives, we also understand the importance of preserving our cultural heritage.Through AAA United, we focus on the pres- ervation and restoration of historic buildings, ensuring that they remain part of our shared legacy.These landmarks hold cultural and historical significance, and we are committed to protecting and maintaining them for future generations to appreciate and enjoy. At the same time, AAA United is focused on building the future. When devel- oping new properties, we strive to meet the highest standards of sustainability, design, and functionality. Our buildings are constructed with a focus on long-term environmental impact, ensuring they are energy-efficient and well-designed to support the needs of communities. By combining modern construction methods with a respect for heritage, we aim to create spaces that stand the test of time. By integrating environmental and cultural stewardship into our work, we believe we are making a meaningful contribution to both the natural world and the com- munities we feel a natural obligation to serve.These efforts are not separate but interconnected, forming the foundation of our commitment to create positive impact through our work and ambitions. BRINGING OUR PORTFOLIO TOGETHER — Several times a year, we bring together our portfo- lio companies to exchange insights on timely and relevant topics.These gatherings create a space to learn from the best in their fields – and from one another – strengthening collaboration and spark- ing new ideas across our portfolio. This year’s Sustainability Seminar took place in the historic former Danish Na- tional Bank in Aarhus – now being carefully restored by AAA UNITED. Sustainability has long been a central theme in our seminars. Bringing our portfolio companies together to engage in these topics is essential for continu- ous progress. At HEARTLAND, we are committed to shaping future business practices and supporting our companies as they navigate environmental, social, and governance challenges. The 2025 seminar, titled “A World in Transition – from a Sustainability Per- spective,” explored how global uncertainty – across environmental, political, and economic dimensions – is influencing the sustainability agenda. The event gathered portfolio companies and external experts for an open exchange of in- sights, opportunities, and inspiration. Despite the challenges of a shifting world, the discussions reflected momentum, action – and optimism. As part of the seminar, we presented the HEARTLAND Sustainability Award, celebrating exceptional sustainability initiatives within our portfolio. This year, the award went to AAA UNITED and BESTSELLER for their logistics centre in the Netherlands – a project that sets new, ambitious standards for industrial construction. The HEARTLAND MarTech Summit 2025 brought together portfolio companies, invited guests, and external experts to explore the rapidly evolving landscape of marketing technology. The speaker line-up featured experts from HEARTLAND portfolio companies alongside leading industry voices, sharing perspectives on how organisations adapt to accelerating change in marketing and technology. Breakout sessions focused on topics such as Activating AI in Marketing Analytics and Customer Service and Conversion Rate Optimisation, encouraging open dialogue and practical learning. At HEARTLAND, we believe that sharing expertise leads to smarter and more effective outcomes. By facilitating collaboration and discussion, the summit helps our portfolio companies discover new ways of working – and strengthens the peer-to-peer relationships that drive growth across our community.