BABCOCK & WILCOX A/S — Financial report

BABCOCK & WILCOX A/S (CVR 25053664). Reporting period: 2025-01-01 – 2025-12-31. Revenue 23.1M DKK, profit after tax 23.6M DKK, equity -368.2M DKK.

CVR 25053664

Latest financial period

2025 • 2025-01-01 • 2025-12-31 • entity • DKK • 23146000 • -64608000 • -21276000 • 23577000 • 61524000 • -368249000 • 26

Financial history

2024 • 2024-01-01 • 2024-12-31 • entity • DKK • 259936000 • 22195000 • -84541000 • -130332000 • 206101000 • -391759000 • 82
2023 • 2023-01-01 • 2023-12-31 • entity • DKK • 464339000 • -55008000 • -139354000 • -142074000 • 425228000 • -259286000 • 136
2022 • 2022-01-01 • 2022-12-31 • entity • DKK • 580733000 • 37661000 • -42923000 • -95117000 • 437158000 • -116767000 • 156
2021 • 2021-01-01 • 2021-12-31 • entity • DKK • 388262000 • 82249000 • -42476000 • -48057000 • 414896000 • -20972000 • 222
2020 • 2020-01-01 • 2020-12-31 • entity • DKK • 436632000 • 192349000 • 37114000 • -166026000 • 392475000 • 26810000 • 271
2019 • 2019-01-01 • 2019-12-31 • entity • DKK • 660562000 • 27777000 • -169575000 • -443452000 • 310001000 • -4178843000
2018 • 2018-01-01 • 2018-12-31 • entity • DKK • 646906000 • -1497194000 • -1665898000 • -1797212000 • 461534000 • -3726134000 • 382
2017 • 2017-01-01 • 2017-12-31 • entity • DKK • 1604025000 • -1135830000 • -1294685000 • -1321270000 • 589122000 • -1927269000 • 552

Annual report highlights

primary activities • Business reviewBabcock & Wilcox A/ S is a fully owned subsidiary of Babcock & Wilcox Enterprises, Inc. (B&W), a U.S.- based public company listed on the New York Stock Exchange (Ticker: BW). We are a leading international supplier of technologies for renewable energy plants that use various types of waste and biomass as fuel. We design, engineer, manufacture, install and service components of various dimensions and configurations primarily based on our own stoker/ grate firing technology. We also provide operating and maintenances services and aftermarket equipment for renewable energy plants. Uncertainties about recognition or measurement We refer to descriptions in note 2 in the financial statements. Going concern The ultimate parent company Babcock & Wilcox Enterprises, Inc. has issued a letter of comfort inter alia stating that it is in the interest of the parent company to ensure that the company meets its financial obligations at all times and that it is the policy of the parent company to provide the company with such support and assistance as may be required to ensure that it maintains capital and liquidity levels to enable it at all times to meet its obligations in conformity with standards of prudence generally accepted for its field of business. This letter of comfort is valid through at minimum June 2027. Based on this, it is the Management's assessment that the Company can continue as going concern. Financial review We continue to see strong demand for our renewable technologies. We have handed over well-performing plants to our customers, and these plants function as showcases for future customers. A more detailed project status summary is contained in our parent company's 10-K to be found at lnvestors.babcock.com. The shareholders’ support letter provided in 2017, in which B&W committed to fund our company with the cash required to meet our obligations and allow the business to continue as a going concern, was last year extended through at minimum December 2026 (see note 1). • entity
development in activities and financial affairs • Development in activities and financial mattersThe revenue for the year totals DKK 23.146.000 against DKK 259.936.000 last year. Profit or loss from ordinary activities after tax totals DKK 23.577.000 against DKK -130.332.000 last year. The development must be seen in light of the fact that, according to the annual report 2025, the company expected revenues for 2025 in the region of DKK and income or loss from ordinary activities after tax of DKK . Management considers the net profit or loss for the year satisfactory. In 2025, the company’s cash and cash equivalents decreased by DKK 10.633.227, i.e. from DKK 15.368.110 to DKK 4.734.883. The company divested all of its technology, a large number of its active projects and the majority of its employees on April 29th, 2025. Following this divestment the company has reduced its staff and lease contracts for offices and storage facilities to meet the needs of the coming years. The company has continued executing the remaining projects and has successfully reached Taking-Over on all of those in 2025 (For one project “Dombasle (FR)” the client’s approval of this was received in 1H2026). Today the obligations to the company’s clients are those related to warranties and guaranties following Taking Over typical for contracts for the market segment that the company has operated in. • entity
expected development • Development for the year relative to the expectationsOur full-year 2025 net revenues were DKK 23 million, which is a decrease of DKK 237 million compared to the prior year due to a decreasing activity level in large project activities. The year-end results reflected a profit of DKK 23 million. We generally recognize revenues and related costs from long-term contracts on a percentage- of completion basis. Accordingly, we review contract price and cost estimates regularly as work progresses and reflect adjustments in profit proportionate to the percentage of completion in the periods in which we revise estimates to complete the contract. To the extent that these adjustments result in a reduction of previously reported profits from a contract, we recognize a charge against current earnings. If a contract is estimated to result in a loss, such loss is recognized in the current period as a charge to earnings and the full loss is accrued on our balance sheet, which results in no expected gross profit from the loss contract in the future unless there are revisions to our estimated revenues or costs of completion in periods following the accrual of the contract loss. Changes in the estimated results of our percentage-of-completion contracts are necessarily based on information available at the time of the estimates and are based on judgments that are inherently uncertain, as they are predictive in nature. As with all estimates to complete used to measure contract revenue and costs, actual results can and do differ from our estimates made over time. The financial position on 31 December 2025 of the Company and the results of the activities of the Company for the financial year for 2025 have resulted in loss of the share capital. Insurance recoveries and sub-contractor claimsManagement expects that for the financial year 2026, revenue will be in the range of DKK 0 and DKK 0, and ordinary profit after tax will be in the range of DKK 0 and DKK 0. Outlook We expect the results of the year for 2026 to be at, or just below, DKK 0 thousand. • entity
going concern uncertainty • 1.Liquidity and Going ConcernThe financial position at 31 December 2025 of the Company still shows a significantly negative equity. The ultimate parent company Babcock & Wilcox Enterprises, Inc. has issued a letter of comfort inter alia stating that it is in the interest of the parent company to ensure that the company meets its financial obligations at all times and that it is the policy of the parent company to provide the company with such support and assistance as may be required to ensure that it maintains capital and liquidity levels to enable it at all times to meet its obligations in conformity with standards of prudence generally accepted for its field of business. This letter of comfort is valid through at minimum June 2027. Based on this, it is the Management's assessment that the Company can continue as going concern. With reference to note 1 in the financial statements of Babcock & Wilcox Enterprises, Inc. for 2024: As disclosed in our 2024 Form 10 K, for the financial period ending and as of December 31, 2024, conditions and events were present and management’s plan for mitigation were assessed as insufficient, such that we concluded there was substantial doubt about the Company’s ability to continue as a going concern. Due to the various actions completed by management during 2025 such as debt restructuring activities, repayment of outstanding debt balances, significant equity raises, and divestitures of non-core business, the Company’s liquidity, financial condition and capital structure improved substantially as of December 31, 2025. As a result, we have concluded that conditions and events no longer raise substantial doubt about the Company’s ability to continue as a going concern • entity
recognition measurement uncertainty • 2.Uncertainties concerning recognition and measurementWe are engaged in a highly competitive industry, and we have priced several our contracts on a fixedprice basis. Our actual costs could exceed our projections, as was the case in recent years with several large contracts in Denmark and the United Kingdom. We attempt to cover the increased costs of anticipated changes in labor, material, and service costs of long-term contracts, either through estimates of cost increases, which are reflected in the original contract price, or through price escalation clauses. Despite these attempts, however, the cost and gross profit we realize on a fixedprice contract could vary materially from the estimated amounts because of supplier, contractor and subcontractor performance, changes in job conditions, variations in labor and equipment productivity and increases in the cost of labor and raw materials, particularly steel, over the term of the contract. These variations and the risks generally inherent in our industry may result in actual revenues or costs being different from those we originally estimated and may result in reduced profitability or losses on contracts. Some of these risks include: difficulties encountered on our large-scale contracts related to the procurement of materials or due to schedule disruptions, equipment performance failures, engineering and design complexity, unforeseen site conditions, rejection clauses in customer contracts or other factors that may result in additional costs to us, reductions in revenue, claims or disputes; our inability to obtain compensation for additional work we perform or expenses we incur because of our customers or subcontractors providing deficient design or engineering information or equipment or materials; requirements to pay liquidated damages upon our failure to meet schedule or performance requirements of our contracts; and difficulties in engaging third-party subcontractors, equipment manufacturers or materials suppliers or failures by third-party subcontractors, equipment manufacturers or materials suppliers to perform could result in contract delays and cause us to incur additional costs. We conduct significant portions of our business by engaging in long-term contracts related to highly complex, customized equipment or facilities for electrical generation, industrial processes, and/or environmental compliance. The complexity of these contracts generally necessitates the participation of others, including subcontractors, equipment or part manufacturers, partner companies, other companies with whom we do not have contractual relationships, customers, financing organizations, regulators, and others. While we endeavor to limit our liability to matters within our control, not all scenarios can be foreseen, and we may become subject to the risk of others’ performance that may or may not be within our control or influence. Delays, changes, or failures of others, including subcontractors, could subject us to additional costs, delays, technical specification changes, contractual penalties, or other matters for which we may be unable to obtain compensation, or compensation may not be sufficient. In extreme cases, the direct or indirect effects of such matters may cause us to be unable to fulfill our contractual requirements. We conduct our business by obtaining orders that generate cash flows in the form of advances, contract progress payments and final balances in accordance with the underlying contractual terms. We are thus exposed to potential losses resulting from contractual counterparties' failure to meet their obligations. As a result, the failure by customers to meet their payment obligations, or a mere delay in making those payments, could reduce our liquidity and increase the need to resort to other sources of financing, with possible adverse effects on our business, financial condition, results of operations and cash flows. In some cases, we have joint and several liability with consortium partners in our projects, as with our previous EPC projects in the United Kingdom, and we may be subject to additional losses if our partners are unable to meet their contractual obligations. In addition, the deterioration of economic conditions or negative trends in the credit markets could have a negative impact on relationships with customers and our ability to collect on trade receivables, with possible adverse effects on our business, financial condition, results of operations and cash flows. We generally recognize revenues and profits under our long-term contracts on a percentage of completion basis. Accordingly, we review contract price and cost estimates regularly as the work progresses and reflect adjustments proportionate to the percentage of completion in income in the period when we revise those estimates. To the extent these adjustments result in a reduction or an elimination of previously reported profits with respect to a contract, we would recognize a charge against current earnings, which could be material. Our current estimates of our contract costs and the profitability of our long-term contracts, although reasonably reliable when made, could change because of the uncertainties associated with these types of contracts, and if adjustments to overall contract costs are significant, the reductions or reversals of previously recorded revenue and profits could be material in future periods. We can perform contracts jointly with third parties. For example, we enter contracting consortia and other contractual arrangements to bid for and perform jointly on large contracts. Success on these joint contracts depends in part on whether our co-venturers fulfill their contractual obligations satisfactorily. If any one or more of these third parties fail to perform their contractual obligations satisfactorily, we may be required to make additional investments and provide added services to compensate for the failure. If we are unable to adequately adress any such performance issues, then our customer may exercise its right to terminate a joint contract, exposing us to legal liability, loss of reputation and reduced profit. Our collaborative arrangements also involve risks that participating parties may disagree on business decisions and strategies. These disagreements could result in delays, additional costs, and risks of litigation. Our inability to successfully maintain existing collaborative relationships or enter new collaborative arrangements could have a material adverse effect on our results of operations. • entity
recognition measurement uncertainty • 2.Uncertainties concerning recognition and measurementWe are engaged in a highly competitive industry, and we have priced several our contracts on a fixedprice basis. Our actual costs could exceed our projections, as was the case in recent years with several large contracts in Denmark and the United Kingdom. We attempt to cover the increased costs of anticipated changes in labor, material, and service costs of long-term contracts, either through estimates of cost increases, which are reflected in the original contract price, or through price escalation clauses. Despite these attempts, however, the cost and gross profit we realize on a fixedprice contract could vary materially from the estimated amounts because of supplier, contractor and subcontractor performance, changes in job conditions, variations in labor and equipment productivity and increases in the cost of labor and raw materials, particularly steel, over the term of the contract. These variations and the risks generally inherent in our industry may result in actual revenues or costs being different from those we originally estimated and may result in reduced profitability or losses on contracts. Some of these risks include: difficulties encountered on our large-scale contracts related to the procurement of materials or due to schedule disruptions, equipment performance failures, engineering and design complexity, unforeseen site conditions, rejection clauses in customer contracts or other factors that may result in additional costs to us, reductions in revenue, claims or disputes; our inability to obtain compensation for additional work we perform or expenses we incur because of our customers or subcontractors providing deficient design or engineering information or equipment or materials; requirements to pay liquidated damages upon our failure to meet schedule or performance requirements of our contracts; and difficulties in engaging third-party subcontractors, equipment manufacturers or materials suppliers or failures by third-party subcontractors, equipment manufacturers or materials suppliers to perform could result in contract delays and cause us to incur additional costs. We conduct significant portions of our business by engaging in long-term contracts related to highly complex, customized equipment or facilities for electrical generation, industrial processes, and/or environmental compliance. The complexity of these contracts generally necessitates the participation of others, including subcontractors, equipment or part manufacturers, partner companies, other companies with whom we do not have contractual relationships, customers, financing organizations, regulators, and others. While we endeavor to limit our liability to matters within our control, not all scenarios can be foreseen, and we may become subject to the risk of others’ performance that may or may not be within our control or influence. Delays, changes, or failures of others, including subcontractors, could subject us to additional costs, delays, technical specification changes, contractual penalties, or other matters for which we may be unable to obtain compensation, or compensation may not be sufficient. In extreme cases, the direct or indirect effects of such matters may cause us to be unable to fulfill our contractual requirements. We conduct our business by obtaining orders that generate cash flows in the form of advances, contract progress payments and final balances in accordance with the underlying contractual terms. We are thus exposed to potential losses resulting from contractual counterparties' failure to meet their obligations. As a result, the failure by customers to meet their payment obligations, or a mere delay in making those payments, could reduce our liquidity and increase the need to resort to other sources of financing, with possible adverse effects on our business, financial condition, results of operations and cash flows. In some cases, we have joint and several liability with consortium partners in our projects, as with our previous EPC projects in the United Kingdom, and we may be subject to additional losses if our partners are unable to meet their contractual obligations. In addition, the deterioration of economic conditions or negative trends in the credit markets could have a negative impact on relationships with customers and our ability to collect on trade receivables, with possible adverse effects on our business, financial condition, results of operations and cash flows. We generally recognize revenues and profits under our long-term contracts on a percentage of completion basis. Accordingly, we review contract price and cost estimates regularly as the work progresses and reflect adjustments proportionate to the percentage of completion in income in the period when we revise those estimates. To the extent these adjustments result in a reduction or an elimination of previously reported profits with respect to a contract, we would recognize a charge against current earnings, which could be material. Our current estimates of our contract costs and the profitability of our long-term contracts, although reasonably reliable when made, could change because of the uncertainties associated with these types of contracts, and if adjustments to overall contract costs are significant, the reductions or reversals of previously recorded revenue and profits could be material in future periods. We can perform contracts jointly with third parties. For example, we enter contracting consortia and other contractual arrangements to bid for and perform jointly on large contracts. Success on these joint contracts depends in part on whether our co-venturers fulfill their contractual obligations satisfactorily. If any one or more of these third parties fail to perform their contractual obligations satisfactorily, we may be required to make additional investments and provide added services to compensate for the failure. If we are unable to adequately adress any such performance issues, then our customer may exercise its right to terminate a joint contract, exposing us to legal liability, loss of reputation and reduced profit. Our collaborative arrangements also involve risks that participating parties may disagree on business decisions and strategies. These disagreements could result in delays, additional costs, and risks of litigation. Our inability to successfully maintain existing collaborative relationships or enter new collaborative arrangements could have a material adverse effect on our results of operations. • entity
contingent liabilities • 20.Contractual obligations and contingencies, etc.Contingent assetsBased on the loss in previous years, management has evaluated that it is not possible to produce convincing evidence for utilizing the deferred tax within the next 3-5 years. Management expects to execute the remaining backlog in a profitable manner and to be able to secure new project opportunities in the market to restore positive income for the Company. However, this evidence does not substantiate the position required to maintain the deferred tax asset from an accounting perspective. Consequently, management has made a valuation allowance for deferred tax assets at year-end 2025. Contractual obligations and contingent liabilities DKK in thousands Lease liabilities7.686 Total contractual obligations7.686 Total contractual obligations and contingent liabilities7.686 Rent and lease liabilities:The company has entered into operational leases regarding cars and serviceagreements of tDKK 7.686 with a remaining contract terms of 6-51 month from the balance date. Warranty commitments and other contingent liabilities:The company has received a warranty claim of DKK 93.850 in June 2026. Management is still assessing the claim, which is believed to have been made after the expiry of the warranty period. • entity