Note 5 Operating segments Fiven identifies its segments according to the organization and reporting structure as decided and followed up by group management. Operating segments are components of a business that are evaluated regularly by the chief operating decision maker, defined as the Chairman, for the purpose of assessing performance and allocating resources. Fiven has three reportable segments: Fiven Norway, Fiven Brazil and Fiven Belgium. Fiven Norway - The two plants in Norway in respectively Lillesand and Arendal are focused on specialty products as well as abrasive applications. Arendal is the oldest still running silicon carbide plant in the world. Fiven Brazil - The largest silicon carbide plant within the Fiven Group is located in Barbacena, Brazil. Mainly supplying the American continent market, the plant provides solutions for refractory and metallurgical applications. Fiven Belgium - The processing plant in Hody, Belgium, delivers mainly products for metallurgical and refractory applications. Fiven Belgium’s source of crude silicon carbide has traditionally been Fiven entities in Venezuela acting as an extension of the Belgian operations with no other customers than the Belgian entity. In August 2021 management decided to restart the production in Venezuela that has been mothballed since the outbreak of the Covid. Other - Fiven ASA has offices in Oslo, Norway. Together with Fiven GmbH in Cologne, Germany, they are performing headquarter and management activities for the Fiven Group. Fiven also has a subsidiary in Pittsburgh (USA) performing sales and marketing services, and a sales representation office in Shanghai (China). Operating segment information Segment performance is evaluated based on Adj. EBITDA (as defined in the APM attachment). Adj. EBITDA shows the Group’s EBITDA before items that require special explanation and is defined as reported EBITDA before “Other income and expenses” (OIE). OIE include one-off and non-recurring operating expenses. The Alternative Performance Measures (APMs) are further explained in the APM attachment to the annual report. In Q2 2021 Fiven changed its internal reporting following the refinancing which amended the reported EBITDA definition under the revised bond agreement. The Adj. EBITDA was adjusted and no longer deducts the positive effect to EBITDA from IFRS 16, and the cap on non-recurring costs is removed. The impact is an increase to Adj. EBITDA, and 2020 has been restated in the table below. Fiven's financing and taxes are managed on a group basis and are not allocated to operating segments. Eliminations comprise mainly of intersegment sales. Transactions between operating segments are conducted on an arm's length basis in a manner similar to transactions with third parties. The accounting policies used for segment reporting reflect those used for the group. SEGMENT REPORTING FOR THE PERIOD 1 JANUARY TO 31 DECEMBER 2021: Amounts in EUR thousand Fiven Norway Fiven Brazil Fiven Belgium Other Total segment reporting Revenue from contracts with customers 56 232 55 269 15 938 - 127 439 Other income 19 - 13 - 32 Total revenue and other income from external customers 56 252 55 269 15 950 - 127 471 Revenue from other group segments 2 976 13 362 - (16 338) - Total revenue and other income 59 228 68 631 15 950 (16 338) 127 471 Operating expenses (excluding depr. & amort.) (49 231) (56 822) (17 678) 17 443 (106 288) EBITDA 9 997 11 809 (1 728) 1 105 21 183 Non-recurring & other non-financial items 115 (168) 2 514 759 3 219 Adj. EBITDA 10 112 11 641 786 1 864 24 403 EBITDA 9 997 11 809 (1 728) 1 105 21 183 Depreciation and amortization (2 444) (1 225) (222) (1 182) (5 072) Operating profit (loss) 16 111 Fiven Annual Report 2021 44 Financial statements
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