enabling your business - royal reesink

Enabling your businessA n n u a l R e p o r t 2 0 1 3 K o n i n k l i j k e R e e s i n k N .V .

A n n u a l R e p o r t 2 0 1 3

Kon ink l i j ke Rees ink N .V.

Kon ink l i j ke Rees ink N .V. Annua l Repor t 20132

Haarlem, 9 a.m. Royal Reesink is there for you – anywhere, anytime

Enabling your business

05:00 06:00 07:00 08:00 09:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00

Annua l Repor t 2013 Kon ink l i j ke Rees ink N .V. 3

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S1 | GENERAL DETAILS

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Key Points in 2013

BUSINESS/OPERATIONAL

- Royal Reesink’s pro forma1 annual revenue for 2013 reaches € 402.4 million.

- Higher revenue and profit, driven mainly by growth in the Reesink Equipment segment.

- Strong investor interest in arable farming thanks to high crop prices. Dairy farming industry

remained cautious in year under review, but outlook is optimistic thanks to higher milk

prices and other factors.

- Strong sales of earth-moving machines in Belgium; Dutch market remains very cautious,

although rental income grew sharply.

- Strong start for Material Handling at Royal Reesink.

- Consistently low market liquidity discourages customers from investing and causes delay in

customer deliveries.

- Strong growth in profit for Reesink Industries segment, although still at an operating loss.

- Hans van Driel (acquired in January 2013) is now part of the Reesink Construction Equipment

division, along with the Kemp Group.

- December 2013: signing of the contract for the supply of Kobelco earth-moving machines in the

Netherlands by the Kemp Group.

- October 2013: acquisition of Pon Material Handling Europe (PMH-E), currently operating under

the name Reesink Material Handling Equipment (RMHE). Motrac Hydraulics has been integrated

into Reesink Industries.

- Forward integration of Kamps de Wild through acquisition of part of the operations of a dealer

company by Landtech Zuid, a new subsidiary of Kamps de Wild Participaties.

- Established structure for the acquisition of the operations of CT Agro GmbH (including the shares

in CT Agro TOO, a service organisation) in Kazakhstan. The acquisition was completed on

15 January 2014. CT Agro already contributed to profit in 2013 through a commission scheme.

- New legal and functional structure was implemented. Integration of activities in the following

segments: Reesink Equipment (including the divisions Reesink Green Equipment, Reesink

Construction Equipment and Reesink Material Handling Equipment) and Reesink Industries.

Property assets used for business operations now part of the segments or divisions.

1) Note: pro forma information has not been audited.


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FINANCE

- Revenue reached € 236.6 million (2012: € 185.2 million), representing an increase of nearly 28%.

Organic revenue was down by € 15.8 million (-8%), caused mainly by € 12 million lower

revenue from the steel business as a result of the restructuring and closure of the (loss-making)

Nederlandse Staal Unie (NSU) and difficult market conditions.

- Operating result before depreciation and amortisation (EBITDA) increased by more than 65%

to € 14.9 million. Organic EBITDA rose by 6.9%.

- Operating result after depreciation and amortisation (EBIT) increased by more than 55% to

€ 10.4 million. Organic EBIT increased by 8.1%.

- Pro forma 2013 revenue: € 402.4 million; EBITDA: € 26.7 million; EBIT: € 16.2 million.

- Expenses relating to financing activities: € 2.1 million, including withdrawal fee for acquisition

facility (including € 0.6 million commitment fee).

- € 1.8 million write-down on real estate.

- € 4.5 million net profit (2012: € 4.3 million net loss).

- Share capital increased by 471,888 depositary receipts for ordinary shares with total earnings

of € 29.9 million.

- € 10.3 million subordinated convertible loan agreed with Pon Holdings B.V.

- Following the CT Agro acquisition, Commerzbank became part of the group of financing banks;

financing increased from the original amount of € 90 million to € 110 million. Completed in

January 2014.

- € 17.0 million earn-out fee payable to Pon Holdings B.V. (excluding € 1.2 million in interest).

- Profit per ordinary share/depositary receipt for an ordinary share: € 4.85 (2012: -/- € 6.22).

- Dividend proposal: € 2.50 per ordinary share/depositary receipt for an ordinary share (2012: nil).



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Evaluation of main points for 2013

●● The acquisition of Hans van Driel in January 2013 and the merger with the Kemp Group into Reesink

Construction Equipment enabled the company to significantly strengthen the market position of its

earth-moving activities in both the Netherlands and Belgium. The addition of the Kobelco brand at

the end of 2013 boosted this position even further.

●● The acquisition of Motrac Intern Transport in the Netherlands, Motrac Handling & Cleaning in

Belgium, Pelzer Fördertechnik in North Rhine-Westphalia (Germany) and Motrac Hydraulics (which

maintains sites in the Netherlands and Germany) ensures further geographic spread in addition to

expanding our range of equipment and industrial products.

●● The company also worked on developing cross-selling and cross-rental opportunities in 2013

between Reesink Green Equipment, Reesink Construction Equipment and Reesink Material Handling

Equipment. The end-of-year show held in De Meern clearly demonstrated how the ranges of the

various divisions complement each other.

●● Following the acquisition of Hans van Driel and PMH-E, Royal Reesink increased its annual revenue

to € 402.4 million, and currently employs approximately 1,100 people (pro forma figure for 2013).

The acquisition of CT Agro, which was completed in January 2014, opened up the Kazakh market

for Royal Reesink.

●● Landtech Zuid, a subsidiary of Kamps de Wild Participaties, launched its operations as a dealer

company for the Claas, Amazone and Kaweco brands for the Central Brabant region.

●● Reesink Financial Services (RFS) underwent a number of changes as a result of the PMH-E takeover

and other factors. RFS is an internal expertise centre specialising in leasing solutions and stock

finance. In addition, RFS also negotiates with leasing companies on behalf of our companies on how

various programmes might be adapted in order to ensure a more efficient flow of equipment in the

sales channel.



Further implementation of growth strategy in 2013 – a quick overview

In all markets in which we operate, we took a number of key steps to strengthen the foundation.

We also added several markets through Reesink Material Handling Equipment and Motrac Hydraulics.

In early 2013, the acquisition of Hans van Driel saw the creation of a strong new player in earth-

moving equipment in the Benelux market, offering strong brands such as Atlas, Terex and IHI.

Hans van Driel and the Kemp Group have joined forces in Reesink Construction Equipment (RCE).

The hi-tech brand Kobelco, which was added to the product range at the end of 2013, has been off to

a very successful start and will improve our access to the major construction companies.

Preface

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Gerrit van der Scheer

Dear readers,

Given the current economic climate, we are certainly not dissatisfied

with the performance of our companies in 2013. The past year was an

unusual year in many ways, in which we took a number of important

steps and, in so doing, laid a strong foundation for our future, with an

even stronger emphasis on expanding our international business.

Following these changes, we will from now on operate under the name:

Royal Reesink

We managed to implement our strategy at an accelerated pace, resulting

in an expansion of the two segments Reesink Equipment and

Reesink Industries and a further extension in the various divisions.

Through more effective risk diversification, expansion into the Kazakh

growth market and the one-stop-shop model we offer, we have become

more appealing to a number of key stakeholders, including suppliers,

customers and investors. Our new position also allows us to provide our

employees – our most important stakeholders – with better career

development opportunities. However, the year did present us with some

challenges as well. We continued to be affected in several areas by low

investor interest and the still-tentative economic recovery. Nevertheless,

we are encouraged by the fact that our companies mostly outperformed

the markets. As stated, we are and will remain a no-nonsense company

which has proved time and again that it is able to pursue the strategies it

sets even when market conditions are challenging.

Kon ink l i j ke Rees ink N .V. Annua l Repor t 20131 0


The establishment of Landtech Zuid, which operates as a dealer of the Claas, Amazone and Kaweco

brands for the Central Brabant region, is in line with Kamps de Wild’s strategy of creating large

expertise centres and strengthens the market position. Expanding into a growth market such as

Kazakhstan has strengthened our partnership with Claas, and has also attracted significant interest

from several other suppliers with which we already do business. This includes suppliers from Reesink

Green Equipment and other parties.

In October 2013, we completed the largest acquisition in Royal Reesink’s history with the acquisition

of the material handling equipment activities of Pon Holdings B.V. in Europe. This instantly established

us as a major European player specialising in equipment and helped us increase our international

presence. This acquisition aligns closely with Royal Reesink’s business model, which revolves around

equipment sales, high quality levels, and service. The activities form part of the new Reesink Material

Handling Equipment division.

The restructuring of the Reesink Industries steel business has enabled us to cut costs, and we will

be ready to benefit from this as soon as the market picks up. We also strengthened the Reesink

Industries segment by integrating Motrac Hydrauliek B.V. and Motrac Hydraulik GmbH, which focus on

developing and providing hydraulic components and solutions.

The various acquisitions have enabled us to increase our pro forma annual revenue to € 402.4 million

(2013) and our staff to approximately 1,100 employees. It is up to us to further expand our strong

foundation, with a heavy focus on cross-selling, cross-rental, total cost of ownership for our customers

and offering a variety of financing concepts. We are currently in a better position to establish vendor

leasing programmes and stock finance programmes in association with external leasing companies, in

an effort to, for example, to reverse the market trend of investor caution.

The substantial growth we have been experiencing naturally also calls for a number of changes to

the business structure. In this area, too, we took a number of measures in 2013, including increasing

the number of Management Board members, the new segmentation and the establishment of the

divisions with their own management.

Financing

As in last year’s annual report, we are pleased to report that, despite the market challenges, our

shareholders and banks have faith in the strategy we have set. Private placement with qualified

investors, private placement of depositary receipts for ordinary shares at Pon Holdings B.V., the public

rights issue for the purpose of retail and the full exploitation of the equity facility facilitated the

acquisitions (particularly PMH-E) and boosted our capital. Our first public rights issue was significantly

oversubscribed and successfully completed. We should note, however, that the drafting of the

prospectus required for the public rights issue turned out to be a very expensive and time-consuming

process. Nevertheless, we do not rule out once again raising funds in the capital market as a means

for financing further growth.

In early 2014 Commerzbank entered the group of financing banks ABN AMRO and Rabobank),

following the acquisition of the CT Agro GmbH operations in Germany. Our financing facility has been

increased by € 20 million, from the original amount of € 90 million to a total of € 110 million, a total of

€ 10 million of which constitutes an acquisition facility.

Annua l Repor t 2013 Kon ink l i j ke Rees ink N .V. 1 1

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Alternext

The company’s share price took a temporary hit – at very small volumes – following the passing of

the dividend. Fortunately, however, confidence in the share price soon returned and the share price

received a boost.

We genuinely used our stock exchange listing in the past year to implement our growth strategy, and

this was been a positive experience for the company despite the reservation made above about the

prospectus. We came on the radar of investors who were previously unfamiliar with Royal Reesink,

which has raised our profile even further.

Nevertheless, we have yet to determine whether Alternext will be the appropriate platform for us

going forward.

2013

We used the year under review mainly to establish our position as a full-line equipment provider in the

market, which we managed to do successfully thanks to the admirable dedication of our employees.

Even at the companies that continue to struggle in their respective markets – including Reesink Staal

and Safety Centre International – people maintain a positive attitude and have faith in the future. We

are pleased to say that they have adapted to the demands of our times. We would also like to take this

opportunity to thank, above all, our business associates, including customers, suppliers, shareholders

and financiers, for placing their trust in Royal Reesink.

2014

We will continue to give it 100% in 2014. In the process of integrating the new companies into the

existing structures, we will focus on using economies of scale and streamlining the logistics processes.

The company currently has a large number of opportunities, and we will continue to anticipate market

conditions. If we do not proceed to sale (through leasing if possible), we will mostly offer rental. We

put our customers first in everything we do and are aimed to keep total cost of ownership as low as

possible for them. Our company’s motto continues to be:

ENABLING YOUR BUSINESSWithin the company, we will continue to work on the ‘R factor’ (Reesink factor), which represents

no-nonsense, customer focus and standards and values.


Gilze-Rijen, 3 p.m. Royal Reesink is there for you – anywhere, anytime

11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00



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ContentsGENERAL DETAILS

PROFILE 15

REESINK SHARES 16

KEY FIGURES 19

REPORT OF THE MANAGEMENT BOARD 23

REESINK EQUIPMENT 51

● Reesink Green Equipment 51

● Reesink Construction Equipment 57

● Reesink Material Handling Equipment 61

REESINK INDUSTRIES 67

RISK MANAGEMENT AND MONITORING SYSTEM 73

CORPORATE GOVERNANCE 77

REPORT OF THE SUPERVISORY BOARD 85

FINANCIAL STATEMENTS 88

Consolidated balance sheet 90

Consolidated profit and loss account 91

Consolidated cash-flow statement 92

Consolidated statement of comprehensive income 93

Notes to the consolidated financial statements 94

Company balance sheet 125

Company profit and loss account 126

Notes to the company financial statements 126

OTHER INFORMATION 137

Audit opinion provided by the independent auditor 137

Events after the balance sheet date 139

Proposal for profit appropriation 140

Statutory provision regarding profit appropriation 140

INFORMATION ON THE MANAGEMENT BOARD MEMBERS 142

INFORMATION ON THE SUPERVISORY BOARD MEMBERS 144

10 YEARS OF ROYAL REESINK 148

MANAGEMENT BOARD OF ROYAL REESINK AND ITS OPERATING COMPANIES 150

REPORT OF THE TRUST OFFICE STICHTING ADMINISTRATIEKANTOOR

VAN AANDELEN ROYAL REESINK 152


08:30 AM, Terwolde Harvesting the crops after a hard day of labour



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Royal Reesink

Royal Reesink focuses on two segments: Reesink Equipment and Reesink Industries.

In Reesink Equipment, our businesses are involved in the distribution of various leading brands

and/or the delivery of strong concepts for agriculture and horticulture, landscape maintenance,

material handling and civil engineering. The products are supplied either directly or through dealers

to farmers, contractors, landscaping companies, golf courses, municipalities, government bodies,

water boards, foresters and logistics customers operating in the food & agri, non-food, industrial,

transhipment (ports) and civil engineering sectors.

In Reesink Industries, our businesses are involved as a distributor of steel, personal protection items

and hydraulic components and systems. In this segment, we supply mainly steel manufacturers,

building sites, installation production companies, technical wholesalers, the offshore and shipping

industry, machinery manufacturers and the agricultural industry.

Royal Reesink’s key assets are:

●● Solution-oriented

●● Knowledge of products, systems and markets

●● Substantial capacity for innovation

As well as enabling us to translate market feedback into innovative solutions for manufacturers, these

assets are essential in order to facilitate our dealers and end users where necessary.

ENABLING YOUR BUSINESSOur companies within the segments and divisions are largely responsible for developing their strategies.

The holding company supports them in this process and encourages, as much as possible, cross-selling

and cross-rental between companies of products which are not distributed on an exclusive basis.

The depositary receipts for ordinary shares in Royal Reesink are quoted on the NYSE Alternext

Amsterdam stock exchange. For 2013, Royal Reesink posted € 236.6 million in revenue, with an

average number of 467 employees.

For more information about our companies and their products, please visit royalreesink.com.

Profile



Reesink sharesRoyal Reesink’s shareholder structure

A large portion of shares held by third parties represent depositary receipts for ordinary shares,

with the shares being held by to the trust office Stichting Administratiekantoor van Aandelen Royal

Reesink. The trust office issues depositary receipts for ordinary shares in exchange for these shares.

The number of shares outstanding at year-end 2013 was 1,057,559, a total of 1,247,559 of which

were ordinary shares (1,189,151 certified and 58,408 registered) and 260,000 cumulative preference

shares at Recopart B.V. The net asset value is € 4.00 per share. In October, the private placement of

203,603 and 150,756 depositary receipts for ordinary shares, respectively, held by qualified investors

and Pon Holdings B.V. was completed at an issue price of € 63.85. Furthermore, in January and

October a total of 70,523 depositary receipts for ordinary shares were issued under the equity facility

with Project Holland Deelnemingen B.V. at an issue price of € 74.00. The public rights issue of 46,986

depositary receipts for ordinary shares at an issue price of € 63.85 took place at the end of November.

Report on control interest and capital interest

Under the statutory provisions regarding control and capital interest, the following statement was

published of the interests reported at year-end 2013 in Koninklijke Reesink N.V. (see also page 131):

Bibiana Beheer B.V. 5.00%

Delta Lloyd Deelnemingen Fonds N.V. 11.61%

Decico B.V. 5.45%

Pon Holdings B.V. 10.00%

Project Holland Deelnemingen B.V. 13.90%

Recopart B.V. 19.55%

Todlin N.V. 8.03%

AMSTERDAM STOCK EXCHANGE 2013

Price (x € 1.00) Sales

100 2000

95 1800 90 1600

85 1400

80 1200

75 1000

70 800

65 600

60 400

55 200

50 01 2 3 4 5 6 7 8 9 10 11 12

Month

Price (x € 1.00)

Sales (x 1,000)

120 3

100 2.5

80 2

60 1.5

40 1

20 0.5

0 02009 2010 2011 2012 2013

Highest price/Lowest price Price

Average daily Sales Sales


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Potential interest

Stichting Continuïteit Royal Reesink has been granted the right to acquire all cumulative preference

shares B included in our authorised share capital. It has been agreed with Stichting Continuïteit Royal

Reesink that the number of votes cast on cumulative preference shares B will not exceed the number

of ordinary shares outstanding at that time and the cumulative preference shares A combined.

Liquidity provider

SNS Securities NV (SNS) is the liquidity provider appointed by Royal Reesink.

Investor Relations policy

We aim to provide financial stakeholders and other interested parties as effectively and in as timely

a manner as possible with relevant (financial) information, in order to provide a clear insight into the

company’s position in constantly changing markets. We do this through a variety of publications and

on our website.

Dividend policy

In compliance with Royal Reesink’s growth objectives and the financial resources this requires, the

company’s dividend policy involves paying between 40 and 55% of the profit at the disposal of

the shareholders. This is based on a capital base of at least 40%. We are willing to pay a higher

percentage if circumstances so allow. We have always paid a cash dividend to date. We do not rule

out offering shareholders to choose a stock dividend in the future.

Employee Participation Plan

Our Employee Participation Plan, which is administered by Recopart B.V., proceeded to payment to

the participants in 2011 in accordance with the plan’s terms and conditions. A total of 15 percent of

the Recopart depositary receipts for shares has not yet been registered. Royal Reesink aims to adjust

the shareholding structure in 2014 by withdrawing the 260,000 cumulative preference shares A held

by Recopart.

Prevention of the misuse of inside information

As a company listed on the NYSE Alternext stock exchange in Amsterdam, we are required to have

provisions in place to prevent the use of inside information by our managers and employees, as

well as to prevent other insiders from gaining access to such information. The statutory provisions

regarding inside information and market manipulation applicable in the Netherlands are included in

the Financial Supervision Act (Wet op het financieel toezicht). We have drafted a series of regulations

in accordance with this Act. The group of individuals who are subject to these regulations on account

of the information available to them have agreed in writing to comply with these regulations.

Mr G.T.M. Linnenbank, CFO, acts as a compliance officer and ensures compliance with laws and

regulations relating to inside information.

Financial calendar

23 april 2014 Trading update

27 mei 2014 General meeting of shareholders

27 augustus 2014 Interim figures for 2014

28 oktober 2014 Trading update


Wierden, 11 a.m. Royal Reesink is there for you – anywhere, anytime

07:00 08:00 09:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00



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ROYAL REESINK – KEY FIGURES

(in thousands of €)Dutch GAAP

2013%

revenueDutch GAAP

2012%

revenue

Net revenue 236,558 185,222

Gross operating income 33,516 14.2% 22,627 12.2%

Operating income before depreciation and amortisation (EBITDA)

14,902 6.3% 8,980 4.8%

Operating income (EBIT) 10,421 4.4% 6,704 3.6%

Net result 4,509 1.9% -4,331 -2.3%

As % of average shareholders’ equity 5.7% -5.7%

Cash flow from operating activities 12,600 8,554

Investments in fixed assets -7,429 -3,189

Investment in acquisition of group companies -37,844 -14,864

Trading working capital 116,022 68,687

Average number of employees 467 293

Group capital 85,083 74,055

Shareholders’ equity 85,109 74,105

Capital base 95,383 74,055

Total capital 252,026 163,096

Capital base as % of total capital (solvency) 37.8% 45.4%

Average number of ordinary shares with a net asset value of € 4.00 per share

909,756 704,022

Number of ordinary shares at year end 1,247,559 775,691

Retained net profit 1,296 -

4.5% dividend on cumulative preference shares A 94 -

Dividend on ordinary shares 3,119 -

Payout ratio 70.6% -

Per ordinary share with a net asset value of € 4.00 per share

Net profit (loss) 4.85 -6.22

Dividend 2.50 -

Shareholders’ equity1) 92.55 103.93

Share price: - year end 70.60 76.00

- highest 84.25 85.50

- lowest 62.00 73.00

1) Calculated for shareholders’ equity, divided by the average number of ordinary shares of the ordinary shares/depositary receipts

purchased, plus the acquisition price (not included in the balance sheet under the statutory provisions) of the own shares/depositary

receipts purchased. For 2013, this increases shareholders’ equity per ordinary share by € 0.17 (versus € 0.22 in 2012).



REVENUE/OPERATING RESULT

PER EMPLOYEE

(index 2010 = 100)

Operating result per employee

Revenue per employee

OPERATING RESULT

(in millions of euros)

Operating result, excluding exceptional

items

Operating result

12

10

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6

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2

0’11

’12’13

225

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175

150

125

100

75

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25

0’11

’12’13


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TAXES/NET RESULT

(in millions of euros)

Net result

Taxes

DIVIDEND/NET RESULT

PER SHARE

(in euros)

Net result

Dividend

12

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9

8

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1

0

-1

-2

-3

-4

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-7 ’11’12

’13

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3

2

1

0

-1

-2

-3

-4

-5’11

’12’13


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S2 | REPORT OF THE MANAGEMENT BOARD

S2

Report of the ManagementBoardKEY TRENDS AND DEVELOPMENTS

Royal Reesink expanded and strengthened its existing operations in the past year. The material

handling equipment business – which represents a new activity in an adjacent market – is part of the

Reesink Material Handling Equipment division (see the organisational chart on page 24).

The acquisition of this business and its integration into Royal Reesink will result in a number of

synergy effects at Royal Reesink in both the short and medium term. We see quick wins (with a

working group having been established for each activity) in the following areas:

1. Supply chain

Optimal organisation of Royal Reesink’s supply chain, including stock management, storage and

logistics of parts, accessories and machines.

2. Cross-selling/cross-rental

Using each other’s distribution network and providing leads to sister companies.

3. Purchasing

The current economies of scale create purchasing discounts.

The one factor all Reesink Equipment companies have in common is the serial number of the machine

sold – this includes purchase/sale, services, rental/lease or fleet management.

Chan

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Comm

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managem

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Service

Rental

Fleet

managem

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ServicePurchase

Finance& lease

Supply chain

Inst

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dba

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Par

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Serial-number

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Additional short-term benefits are also created by using each other’s strengths and integrating the HR,

Finance, IT and Communications departments wherever possible.

Apart from the synergy benefits described above, Royal Reesink has become more appealing to certain

stakeholders on account of its current size and the strong synergy between the existing activities.

Investors and suppliers have more faith in a financially strong company with adequate economies

of scale. This will also help generate more interest for our company among potential employees, in

particular high potentials. These aspects will also contribute to our further growth.

Vision, mission, objectives and strategy

We took a significant step in 2013 in further advancing our goal of eventually becoming an equipment

supplier in the broadest sense of the term, operating in interrelated markets. Landscape maintenance

has a natural link to agriculture. Earth-moving machines are used in agriculture and by logistics

transhipment companies. Material handling equipment is used in agriculture, landscape maintenance,

earth moving and infrastructure.

ROYAL REESINK

REESINK INDUSTRIESREESINK EQUIPMENT

REESINK GREEN EQUIPMENT

REESINK CONSTRUCTION EQUIPMENT

REESINK MATERIAL HANDLING EQUIPMENT

The three divisions included in Reesink Equipment are a complete and coherent whole. The company

will grow by expanding its product range within one of the divisions and by increasing our presence

in Europe and potentially further developing our Kazakhstan portfolio.

2013-2016: strategy to become a major full-line equipment distributor

We are aware that the strategic plan does not appear to be relevant to Reesink Industries, and while it

is true that these companies do not supply machines, they do fit in with our company profile, in which

‘Enabling your business’ is a key focus. The companies Reesink Staal, Safety Centre International and

Motrac Hydraulics all meet these requirements. Motrac Hydraulics even supplies hydraulic components

and engineering solutions to several of our equipment manufacturers, and therefore also plays a

significant role in aftersales for these machines. Reesink Staal also provides to our customers in the

agriculture and civil engineering industries.


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Several Reesink Industries entities will be prioritising the further optimisation of their companies’

profitability in the immediate future. Below we describe our mission, vision, objectives and strategy

for the 2013-2016 period.

Vision statement

With more than nine billion mouths to feed by 2050, production per hectare will need to be increased

in areas where land is scarce. This requires highly effective production methods and machines. Areas

with lower levels of development than Western Europe will show a delayed demand for high-quality

machines and equipment.

The global population growth will see both a rise in the demand for (more efficient) equipment and

machinery in the agricultural segment and a growing demand for logistics solutions (a demand met by

material handling), along with a growing need for high-quality infrastructure (in the civil engineering

industry).

An absolute condition if we are to still have a viable planet Earth by 2050 where all these people can

live and work is to improve the sustainability of resources and processes.

Mission statement

Through its knowledge of products and markets, Royal Reesink aims to be an indispensable player in

the distribution chain by a) translating market feedback into innovative solutions for our customers

and b) being a solid and reliable partner to our suppliers.

Goals (quantitative objectives) for 2013-2016

●● Structuring the companies such that they can provide customers with the best possible services at

a low price. This involves:

●● Adopting a customer-focused attitude.

●● Creating a ‘lean and mean’ business environment.

●● Maintaining a high level of knowledge.

●● A small holding company which stimulates the divisions’ management teams and encourages them

in implementing the strategy and achieving the objectives. The holding company ensures optimum

financing in order to facilitate the required growth within the various segments and divisions.

●● Structuring of the support services HR, Finance, Finance, ICT and Communications in line with the

new functional structure of segments and divisions where centralisation, organisation at the division

level, or a combination of the two is chosen based on the risk and efficiency of individual services.

●● Expanding risk management and Corporate Social Responsibility.

●● Offering a total package:

●● Product

●● Service

●● Rental

●● Engineering

●● Processing

●● System integrator

●● Strong dealer management.

●● Further developing our portfolio in growth markets, including Kazakhstan.

●● Being an appealing employer for employees looking to use their talent.

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00:00 01:00 02:00 03:00 04:00 05:00 06:00 07:00 08:00 09:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00

Harsen, noon Royal Reesink is there for you – anywhere, anytime

00:00 01:00 02:00 03:00 04:00 05:00 06:00 07:00 08:00 09:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00




SWOT analysis

Strengths:

●● Customer satisfaction is in our DNA; the appropriate advice and a solution-oriented offer.

●● Knowledge organisation and knowledge of markets.

●● Trendsetter in the market (dealer participation, shift in the chain for steel, flexible fleet management

and capacity contracts).

●● Focus on total cost of ownership (TCO).

●● Knowledge of the supply chain.

●● Open, enterprising, no-nonsense culture.

●● Good relationships with principals.

●● Efficient parts distribution and aftersales system.

●● Better geographic distribution and risk diversification following developments in 2013.

●● Providing financing opportunities in association with external leasing companies.

●● Good relationships with financial institutions and shareholders.

●● Ratio between loan capital and capital base.

Weaknesses:

●● Position in industrial segment remains too dependent on construction industry.

●● Marketability of shares needs to be further improved.

●● Organisation not yet at the required level.

Opportunities:

●● Expanding our international operations, particularly in emerging markets.

●● Growing demand from agricultural markets.

●● Changing distribution through the emergence of e-commerce calls for new solutions in the supply

chain.

●● Becoming more appealing to qualified employees due to increased size.

Threats:

●● Market volatility.

●● Lack of financing opportunities.

●● Differences in the corporate cultures of the various companies.

Challenges

Challenges directly translate the SWOT to our business operations. They indicate how:

●● The company will be using a particular strength to take advantage of an opportunity.

●● The company will be using a particular strength to ward off a particular threat.

●● The company intends to turn a weakness into a strength in order to seize an opportunity.

●● The company intends to ward off a weakness in order to ward off a threat.

Strength to seize opportunities:

●● By being a knowledge organisation and thanks to its good relationships with principals, Royal

Reesink can develop its international operations and benefit from the growing demand for our

products and services in the global market.


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●● Knowledge of logistics within our organisation can help customers reorganise their logistics role. The

increased size combined with our status as a knowledge organisation will make it easier to attract

and retain qualified employees.

●● Offering financing options (in association with leasing companies) will reduce the likelihood of a

financing deficit.

●● Adopting a solution-oriented attitude reduces the total cost of ownership for our customers.

Strength to ward off threats:

●● Trendsetters in the market tend to be more successful than followers at controlling the market,

making them less dependent on the whims of the market. This makes them less vulnerable to

volatility.

●● The improved geographic spread and risk distribution make Royal Reesink less sensitive to market

volatility.

●● A good relationship with financial institutions and major shareholders increases the likelihood of

securing financing to fund the company’s growth.

●● The prevailing open, enterprising, no-nonsense culture must be able to help bridge any cultural

differences.

Turning weaknesses into strengths and seizing opportunities:

●● Further adjusting the organisation to the desired growth path more effectively prepares the

organisation for international expansion and allows it to benefit from the growing demand for our

products and services.

Turning around weaknesses in order to ward off threats:

●● If we make the industrial division less dependent on the construction industry, it will, by consequence,

become less dependent on a volatile market.

Strategy

The strategy is aimed at achieving the objectives described through organic growth and growth

through acquisition – in other words, the road from A to B.

●● Optimising the organisational structure (see the organisational chart) by using each other’s strengths,

integrating them and enhancing them, focusing in particular on reinforcing HR, IT, Finance and

Communications.

●● Taking maximum advantage of synergy opportunities by prioritising, through Reesink Equipment,

supply chain management, cross-selling and cross-rental, and purchasing, managed by working

groups created for this purpose.

●● Our management development programme is aimed at assisting and supporting employees in their

careers and at attracting and retaining talented employees.

●● Royal Reesink puts the customer-focused attitude into practice in a variety of ways, including by

organising dealer days, opening training centres and – above all – by reducing customers’ total cost

of ownership. The company sets performance indicators in order to measure customer satisfaction.

●● The Reesink Finance Services internal expertise centre has partnered with leasing companies to

organise financing options designed to eliminate problems in the market associated with traditional

financing methods.

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●● The leasing concept offered by Reesink Construction Equipment and Reesink Material Handling

Equipment provides customers with a variety of benefits: they are not required to make capital-

intensive investments, the rental periods are flexible, and customers have access to high-end

equipment. For Royal Reesink, rental means customer retention (with a likelihood that they will

proceed to purchase new equipment at a later stage). Another benefit is the higher return on the

rental activities compared with other activities. The (shared) rental concept will be further developed

in the coming years.

●● Reesink Material Handling Equipment will make an effort to provide its services as a system

integrator even more so than is currently the case.

●● Royal Reesink intends to achieve organic growth in a number of ways, including by:

●● Using financing forms (vendor leasing for end users and stock finance programmes for dealers).

●● Expanding into new regions.

●● Dealer investments in full-line dealers.

These and other initiatives will enable Royal Reesink to retain or strengthen its market position, both

in existing and new markets.

●● Growth through acquisition will be aimed mainly at emerging and adjacent markets and by expanding

our product ranges in existing divisions.

●● In order to generate strong profits from our activities in the industrial segment, our priority in the

steel business will be to further shift from construction-focused to industry-focused. Shifting the focus

to special steel and semi-finished products will increase efficiency. Another possibility is expanding

the product range to include non-ferrous metal products.

●● Safety Centre International will be focusing on reducing dependency on a single supplier. The PBM

programme, including the E-learning feature, will be further expanded.

●● Motrac Hydraulics – which became part of Reesink Industries last year – aims to achieve growth

in adjacent activities, including marine and offshore. The Equipment divisions, with their high-

intensity use of hydraulic systems and steel – also provide opportunities for revenue growth.

FINANCIAL POSITION

The financial statements, which were prepared in accordance with Dutch GAAP (and in compliance

with the Fair Value Resolution for the appraisal of investment property) served as the basis for this

paragraph.

Change in Group composition

Acquisition of Hans van Driel B.V.

The acquisition of the full issued share capital of Hans van Driel B.V., established in Tiel, the Netherlands,

was completed on 28 January 2013. The purchase price of the shares was € 1.6 million. A € 2.6 million

interest-bearing loan was acquired in addition to the company. On account of the transaction costs

and the changes made to the management structure, the amount in goodwill was € 0.3 million. As at

1 January 2013, Hans van Driel’s balance sheet total was € 6.7 million, with shareholders’ equity of

€ 2.1 million. The acquisition was financed through the issue of 59,300 depositary receipts for ordinary

shares, at an issue price of € 74 (yielding nearly € 4.4 million) under the equity facility with Project

Holland Deelnemingen B.V.


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Acquisition of Pon Material Handling Europe B.V., Pelzer Fördertechnik GmbH and Motrac Hydraulik GmbH

On 16 October 2013, Royal Reesink completed the acquisition of the issued share capital of Pon Material

Handling Europe B.V. (PMH-E, 100%) with its subsidiaries Motrac Intern Transport B.V. (MotracLinde),

Motrac Handling & Cleaning NV/SA and Motrac Hydrauliek B.V. In addition, it also acquired the shares

in Pelzer Fördertechnik GmbH (75.04%) and Motrac Hydraulik GmbH (100%). The fixed purchase

price (including interest-bearing debts) was € 62.5 million. The variable purchase price depended

on the 2013 EBITA for the acquired companies and reached € 17.0 million (excluding interest). The

total purchase price was € 79.5 million. As at 1 January 2013, the balance sheet totals reached

€ 79.1 million, with shareholders’ equity of € 46.6 million. Total goodwill (including acquisition costs,

earn-out fee and interest payments) amounted to € 22.9 million and was taken to equity. The fixed

purchase price of the shares, including the acquisition costs and interest payments, are financed

through the following means:

●● A private placement of 203,603 depositary receipts for ordinary shares at an issue price of € 63.85

with qualified investors and with proceeds of € 13.0 million.

●● A private placement of 150,756 depositary receipts for ordinary shares at an issue price of € 63.85

at Pon Holdings B.V., with proceeds of € 9.6 million.

●● A public rights issue of 46,986 depositary receipts for ordinary shares at an issue price of € 63.85

for retail, with proceeds of € 3.0 million.

●● A € 10.3 million convertible subordinated loan provided by Pon Holdings B.V..

●● A € 26.6 million withdrawal under the (acquisition) facility agreed with ABN AMRO and Rabobank.

The variable purchase price of the shares, including interest, is € 18.2 million. After settlement of

the € 0.7 million in fees payable under the contractual provisions, as agreed with Pon Holdings B.V.,

an amount of € 17.5 million will be financed in early April. This will be done by increasing the

subordinated convertible loan with Pon Holdings B.V. by € 7.5 million, a € 4.8 million subordinated

loan with Pon Holdings B.V., and € 5.2 million from the available bank facility.

Acquisition of dealer company activities by Landtech Zuid B.V.

Landtech Zuid, a new subsidiary of Kamps de Wild Participaties, acquired part of the business of

Jans-VanGemeren Mechanisatie B.V., an equipment wholesaler based in the Veghel (Netherlands), on

18 October 2013. Landtech Zuid started out as a company dealing in Claas, Amazone and Kaweco

as well as other brands for the Central Brabant region. The total value of the assets and liabilities

acquired was nil; the goodwill on the acquisition was € 0.3 million. The acquisition was financed by

the issue of the 11,223 depositary receipts for ordinary shares remaining under the equity facility, at

a price of € 74.

The acquired companies will be included in the scope of consolidation from the time the control is

effectively acquired (that is, the profits earned by Hans van Driel from 28 January 2013 onwards and

the profits of PMH-E from 16 October 2013 onwards. However, both at Hans van Driel and at PMH-E,

any returns after 1 January 2013 were for the account of Royal Reesink. Profit until the time of the

delivery of the shares was adjusted for goodwill. The acquisition of PMH-E caused Royal Reesink to

more than double in size on an annual basis. In order to increase the amount of information available,

pro forma information relating to revenue and annual operating income will be provided in addition

to discussion of the company’s financial situation in accordance with the financial statements. The pro

forma information has not been audited.

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In order to determine organic revenue, Reesink Material Handling Equipment, Motrac Hydraulics and

Hans van Driel were eliminated for 2013, and a like-for-like comparison with 2012 was made for the

Kemp Group.

Revenue

Revenue 2013 (amounts in € million)

2013 2012

RHME (€ 40)

Equipment (€ 198)

RGE (€ 115)

Other (€ 1)

Industries (€ 38)

RCE (€ 43)RHME (€ 0)

Equipment (€ 137)

RGE (€ 118)

RCE (€ 19)

Other (€ 0)

Industries (€ 48)

Pro forma revenue 2013 (amounts in € million)

2013 2012

RHME (€ 191)

Equipment (€ 349)

RGE (€ 115)

Other (€ 0)

Industries (€ 53)

RCE (€ 43)

RHME (€ 0)

Equipment (€ 137)

RGE (€ 118)

Other (€ 0)

Industries (€ 48)

RCE (€ 19)

Geographic revenue 2013 (amounts in € million)

2013 2012

Belgium (€ 51)

Other/non-EU (€ 3)

Germany (€ 19)

The Netherlands (€ 164)

Belgium (€ 36)

Other/non-EU (€ 1)

German (€ 8)

The Netherlands (€ 140)


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Revenue for 2013 totalled € 236.6 million (versus € 185.2 million in 2012), representing an increase

of almost 28%. The acquired companies had revenue of € 56.6 million. Organic revenue fell by

€ 15.8 million (-8%), due mainly to a € 12 million decline in revenue from the steel business and

the restructuring and closure of the (loss-making) Nederlandse Staal Unie (NSU) and difficult market

conditions. Pro forma revenue for 2013 was € 402.4 million. The dependence on the Dutch market has

been reduced in terms of geography: a total of 58% of revenue was still generated in the Netherlands

(2012: 76%), while revenue in Belgium increased to 24% (2012: 20%) and in Germany to 17% (2012: 4%).

Reesink Equipment’s revenue increased by € 60.8 million to € 198 million, a total of € 53.2 million of which

was generated by RMHE and Hans van Driel. Reesink Equipment’s organic revenue fell slightly, by 2.5%.

Reesink Equipment posted pro forma revenue for 2013 of € 349.1 million. The acquisition of

Huur&Stuur (a Kemp Group business) in May 2012 increased the portion of rentals in revenue. The

integration of RMHE further enhances this effect. Of the pro forma revenue for 2013, a total of 7%

was generated by rentals (2012: 3%). Another significant change in the composition of the revenue

is the growing interest of service (including parts). Service accounted for 24% of pro forma revenue,

versus 14% in 2012

Reesink Green Equipment (RGE) posted revenue of € 115.5 million in 2013 (2012: € 118.4 million).

The effects of the long winter and bad spring were noticeable at the start of the year under review.

Trends varied depending on the sector and country; arable farming, for example, saw strong

investment thanks to the high prices. The dairy farming sector was faced with more cautiousness.

After weak revenues in 2012 – in which feed prices rose sharply – and the discontinuation of red

diesel in early 2013, the industry adjusted accordingly. Additionally, in anticipation of the release

of the dairy produce quota, banks are encouraging dairy farmers to increase their loan repayments.

Sales in Belgium were lower as well as a result of the ‘Agribex’ effect. Agribex is a biannual agricultural

fair held in Belgium (in December during uneven years), which typically generates substantial sales

the following spring. There was an upward trend again in the agricultural sector in the second half of

2013, supported by rising milk prices and higher crop prices. This trend was somewhat levelled off in

Belgium due to the lower liquidity in the market. Government cuts also continued to have an impact

on trends relating to landscape maintenance as well as forest, park and garden management; however,

this was offset by a stronger position in the other markets, particularly golf course maintenance.

Reesink Construction Equipment (RCE) was expanded in January 2013 with the addition of Hans van

Driel, and posted revenue of € 42.7 million (2012: € 18.8 million). Organic revenue was marginally

higher. There were some differences in the geographic markets. The Belgian market for the sale

of earth-moving equipment – as in 2012 – was significantly better than its Dutch counterpart.

Contractors, which were already faced with a lack of work due to an absence of new projects, were

also burdened with additional expenses following the discontinuation of red diesel. However, this

caused the revenues of Huur&Stuur in the Netherlands to increase by more than 17%.

Reesink Material Handling Equipment (RMHE) became part of Royal Reesink on 16 October 2013

and generated revenue of € 39.8 million during the last two and a half months of the year. RMHE’s

pro forma revenue was € 190.8 million in 2013. The equipment companies all use the same serial

numbers, but RMHE’s revenue model is aimed primarily at generating income from service and parts

(accounting for nearly 32% of pro forma revenue for 2013) and rental (10% of RMHE’s pro forma

revenue for 2013). Service and parts accounted for a slightly greater share of the revenue in Germany


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(North Rhine-Westphalia) than in the Netherlands and Belgium, while rental made up a more significant

portion of the revenue in the Netherlands.

Revenue of the Reesink Industries segment during the year under review totalled € 37.8 million (2012:

47.5 million), of which a total of € 3.4 million in revenue from hydraulic systems and components

supplied to customers by Motrac Hydrauliek B.V. and Motrac Hydraulik GmbH after 16 October 2013.

Of the sharp fall in organic revenue, € 12.0 million was attributed to lower revenue from the steel

business following the restructuring and closure of the (loss-making) Nederlandse Staal Unie (NSU) and

the difficult market conditions. Demand for steel continued to decline further in 2013, causing market

overcapacity to increase accordingly.

Gross operating income, expenses, other operating income

Gross operating result increased to € 33.5 million (2012: € 22.6 million). The 8% decline in organic

revenue resulted in 3% lower organic gross operating income. The restructuring of the steel business

clearly had a positive effect on gross operating income. The higher share of service (including parts)

and rentals in revenue also translates into higher gross operating income in percentages of revenue,

at 14.2% (2012: 12.2%).

The total amount in selling expenses and administrative expenses increased following the merger of

the operations to € 26.3 million (2012: € 18.0 million). Total organic expenses decreased by € 0.4

million.

The € 3.3 million in other operating income was boosted by a € 1.5 million provision received. In 2013,

Royal Reesink assisted the former owner of CT Agro GmbH with the sale of machines in Kazakhstan.

As part of these efforts, Royal Reesink added the Claas country manager for Kazakhstan (among

others) to its team, also in anticipation of his role as the director of CT Agro GmbH (expenses relating

to administrative expenses). External rental income and management fees in relation to THR B.V. fell

by € 0.5 million.

Operating income

Operating income before depreciation and amortisation (EBITDA) increased by more than 65% to

€ 14.9 million (2012: € 9.0 million, including € 0.2 million in exceptional items). Organic EBITDA rose by

6.9%. Royal Reesink did not show any substantial differences between EBITDA and operating income

(EBIT), but the depreciation on RMHE’s rental fleet and Huur&Stuur (Kemp Group) are significant.

Another important change is the amortisation of intangible fixed assets related to the acquisition of

RMHE and the software. The total amount in depreciation and amortisation came to € 4.5 million.

Operating income increased by more than 55% to € 10.4 million (2012: € 6.7 million, including

€ 0.2 million in exceptional items). Organic operating income increased by 8.1%. The restructuring of

the steel business during the second half of 2012 (including the closure of NSU) resulted in a strong

bump in operating result, but even though the organisational changes implemented in response to the

difficult market conditions, the company did not generate enough profit to extricate itself fully from

the loss-making situation.

Pro forma EBITDA for 2013 was € 26.7 million, while operating income was € 16.2 million.



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Expenses relating to financing activities; value adjustments, securities

An average of € 2.1 million in income received from financing activities and expenses relating to

financing activities and equivalent income and expenses was taken to the profit and loss account

(2012: € 0.6 million). A total of € 0.5 million of this increase was related to (one-off) fees paid to the

banks in relation to withdrawals made under the acquisition facility (including a commitment fee).

An additional € 0.1 million in expenses were related to the drafting of bank documents during the

year under review. These expenses were amortised for the period until the expiry of the financing

agreement, i.e. 31 October 2015. The expansion of Royal Reesink resulted in a greater need for credit,

which was met to some extent with a subordinated convertible loan provided by Pon Holdings B.V. (at

an interest rate of 5.25%).

The balance of movements for 2013 in claims included in fixed assets was nil, while in 2012 this was

€ 3.0 million negative. Claims against THR B.V. relating to loans or guarantees totalled € 3.4 million as

at 31 December 2012 and will be fully written down on account of uncertainty regarding future free

cash flows. A total of € 1.3 million in loans was provided in 2013 as part of efforts to find a long-term

solution for THR B.V., which are expected to be repaid by THR B.V. in the future. The VIBA N.V. shares

held by us did not generate any dividend payments (2012: € 0.2 million).

The appraisals of the real estate resulted in a write-down of € 1.8 million (2012: write-down of

€ 2.9 million) (‘non-realised fair value adjustments of investment property’). The impact of general

negative market trends in real estate and the economic and technical obsolescence was most significant

for the distribution centre at Ecofactorij in Apeldoorn (which is leased to THR B.V.): a write-down of

€ 1.3 million. The property assets used for business operations were written down at an amount

of € 0.2 million through the profit and loss account.

Taxes

The tax burden for 2013 was 30.7% – 5.7% higher than the nominal burden applicable to the

Netherlands. The impact of the foreign companies on the tax burden was 5.3%.

Income from participations

The share in the profit of companies in which we participated was nil during the year under review

(2012: loss of € 3.9 million). The loss from participations in 2012 was due almost entirely to the share

in the loss for 2012 of THR B.V. and the impairment of the participation value of THR B.V. to nil.

Net profit (loss)

Net profit for 2013 was € 4.5 million (2012: net loss of € 4.3 million). Profit per ordinary share with

a net asset value of € 4 was € 4.85 (2012: € -6.22).

Profit distribution

A proposal will be made to the General Meeting of Shareholders to pay a dividend per ordinary share

for 2013 of € 2.50. The dividend policy is aimed at paying between 40 and 55% of the profit at the

disposal of the shareholders, taking into account Royal Reesink’s growth objectives and the financial

resources required to achieve these. Royal Reesink believes a higher payment for 2013 (70.6%) is

justified, also because no dividend was paid for 2012.

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Cash flows

Cash flow from operating activities increased by € 4.0 million to € 12.6 million in 2013. The € 5.9

million increase in EBITDA resulted in a € 6.2 million increase in cash flow from business operations.

Expenses relating to financing activities and income tax paid were € 2.1 million higher. Cash flow from

investing activities totalled € -45.3 million (2012: € -18.1 million), of which € 37.8 million related

to the acquisitions (2012: € 14.9 million). Net investment in fixed assets was € 4.2 million higher,

particularly due to investments in rental fleets. Cash flow from financing facilities totalled € 34.5

million (2012: € 13.8 million) and was related to the financing of the acquisitions through an increase

in the share capital, entering into a subordinated convertible loan and using bank facilities.

Fixed assets

The intangible fixed assets item comprises the service contracts acquired by Royal Reesink on

the acquisition of RMHE with customers and software with a total book value of € 4.8 million.

A total of € 0.4 million was invested in software during the year under review, and amortisation came

to € 0.4 million.

The acquisitions resulted in € 23.7 million in new consolidations in tangible fixed assets. For land

and buildings, the property assets of the RMHE companies in Kerpen (Germany) and Köln (Germany)

and Antwerpen (Belgium) were included for an amount of € 7.7 million. Of the total write-down of

€ 0.8 million on land and buildings, a total of € 0.2 million was taken to the profit and loss account. The

remaining € 0.6 million was taken directly to equity following deduction of deferred taxes.

The rental of material handling equipment constitutes a significant part of RMHE’s revenue model.

At the time of the acquisition, the book value of the rental fleets was € 13.7 million. The significance

of Huur&Stuur further increased at the Kemp Group, and the company invested in an expansion into

several different sites during the year under review. Net investment in the various rental fleets was

€ 3.4 million. Depreciation came to a total of € 4.0 million (2012: € 2.3 million). Total write-downs of

the investment property at the end of the financial year were € 1.6 million. These write-downs related

mostly to the building at Ecofactorij in Apeldoorn.

The balance of financial fixed assets increased from € 1.7 million to € 3.8 million. A total of nearly

€ 1.3 million was provided to THR B.V. in loans during the year under review. At year-end 2013, a total

of € 0.8 million remained of the deferred tax assets included in the RMHE acquisition.

Working capital

Trading working capital at year-end 2013 totalled € 116.0 million (2012: € 68.7 million). Of this

increase, a total of € 3.8 million is the result of the integration of RMHE, Motrac Hydraulics and Hans

van Driel.

Total inventory increased by € 26.9 million in the year under review; of this amount, € 30.6 was for

the account of the ‘new’ companies. Reesink Equipment’s inventory totalled € 77.3 million, versus

€ 55.8 million at year-end 2012.Reesink Equipment’s organic inventory fell by € 1.5 million. The

balance of prepayments on inventories was € 0.3 million higher. Contrary to the other divisions,

the new machines at Reesink Material Handling Equipment are largely purchased following receipt of

the customer order. Reesink Industries’ inventory value at year-end 2013 was € 13.0 million. Of the

€ 5.4 million increase over year-end 2012, a total of € 7.6 million was the result of the integration of

Motrac Hydraulics. Inventory at the steel companies was € 2.4 million lower, as the inventory at these



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businesses was further adjusted to market conditions. The fair value adjustment of the inventory of

rolled steel products was € -0.3 million gross for 2013, which was taken to equity as a reserve for

price differences. The provisions for unmarketable inventories as a percentage of inventory value

totalled 13.0% (2012: 11.2%).

The balance of accounts receivable increased by € 26.7 million; the organic increase was € 0.7 million.

Reesink Equipment’s balance of accounts receivable totalled € 42.8 million (2012: € 19.9 million). The

integration of RMHE and Hans van Driel resulted in a € 22.8 million increase.

The balance of accounts receivable at Reesink Industries rose by € 1.7 million to € 6.2 million. Motrac

Hydraulics had a balance of accounts receivable of € 3.2 million. At other companies operating in this

segment, the balance fell by € 1.5 million.

Changes in shareholders’ equity

Shareholders’ equity increased by € 11.0 million during the year under review. Net profit reached

€ 4.5 million. A total of 471,868 ordinary shares were issued during the year under review, resulting

in a € 1.9 million increase in the issued share capital and a € 28.0 million increase in the premium

reserve. The proceeds from the rights issues were used to pay a portion of the purchase prices for

the acquisitions of PMH-E, Hans van Driel and Landtech Zuid. Part of these proceeds were used in

early 2014 to cover a portion of the purchase price of the operations of CT Agro GmbH. Total goodwill

for the 2013 acquisitions which were taken to equity amounted to € 23.4 million; almost 98% of this

amount related to the acquisition of PMH-E. The goodwill includes a € 17.0 million earn-out fee. The

revaluation of land and buildings used for business operations caused the revaluation reserve to fall

by € 0.5 million. The other changes in shareholders’ equity averaged € 0.6 million, accounted for

mainly by a € 0.8 million adjustment of corporation tax and several items which were taken to equity.

Balance sheet ratios and other ratios

Total equity reached € 85.1 million (2012: € 74.1 million), representing 33.8% of the balance sheet

total (2012: 45.4%). The purchase price of PMH-E was paid in the total amount of € 10.3 million

through a subordinated convertible loan with Pon Holdings B.V. Including this loan, the solvency rate

was 37.8%. A portion of the earn-out fee will be financed through an increase in the subordinated

convertible loan and the provision of an additional subordinated loan by Pon Holdings B.V. Taking into

account the above, this brings the capital base to 42.7% of the balance sheet total.

The calculation method in the covenant with the banks resulted in a solvency rate of 39.9%. The Net

Senior Debt/EBITDA ratio came to 2.6 (permitted rate: 3.6). The Debt Service Coverage Ratio likewise

comfortably exceeded the requirements set by the banks.

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Financing

The total amount in interest-bearing loans was € 82.9 million (2012: € 45.3 million), including a € 10.3

million subordinated convertible loan arranged with Pon Holdings B.V. Of the remaining € 72.6 million,

a total of € 30.9 million consisted of a long-term loan; € 17.2 million comprised the acquisition facility

drawn down in 2013; € 13.4 million in mortgage loans and € 0.3 million in other (financial lease)

liabilities. The short-term portion of these liabilities comprised € 7.6 million, while at year-end 2013

a total amount of € 34.1 million was payable to banks in overdraft debt. Cash and cash equivalents

totalled € 6.5 million as at 31 December 2013, a total of € 3.4 million of which was reserved to finance

a portion of the acquisition price of the operations of CT Agro GmbH.

Other matters

Financing agreement

The financing documents were amended following the acquisition of PMH-E in 2013, with the acquired

companies entering into the financing agreement Royal Reesink signed with ABN AMRO and Rabobank.

The financing facility did not change; however, a framework was agreed for the allocation of the

drawdown under the acquisition facility to the current and non-current liabilities. In addition, several

sections were amended to reflect the new situation. In early 2014, due in part to the completion of

the acquisition of the CT Agro GmbH operations, Commerzbank entered the group of financing banks

for a total amount of € 20 million. This increased the financing facility to € 110 million: a mortgage

loan with an original amount of € 15 million, a long-term loan of € 20 million (to be repaid over a

seven-year period), a € 65 million credit facility and a € 10 million acquisition facility. The term of

the committed financing facility remained unchanged at three years (maturity date: 31 October 2015).

The interest rate depends on the facility based on 1-month or 3-month EURIBOR plus an average spread

of 241 basis points. For information on the covenants, please see page 115 of the financial statements.

The following securities have been set: mortgage registration on land and buildings used for business

operations, along with a pledge on inventories, machinery and equipment, claims and bank assets.

The acquisition allows for the option to finance acquisitions (subject to terms and conditions) at up to

60 percent of the enterprise value. The remaining 40 percent must be financed through equity.

Employees

The average number of employees increased to 467 in 2013, up from 236 in 2012. This increase

was due mainly to the acquisition of Hans van Driel and PMH-E. At the end of the financial year,

the company employed more than 1,000 people, a number which has increased to roughly 1,100

following the acquisition of CT Agro.

Our HR policy is aimed at ensuring the long-term employability of our staff, based on the following

elements:

●● Vitality and quality

●● Training and education

●● Safety

●● Absence management

Vitality and quality

Besides the continuation of vitality programmes, a key focus in the year under review was improving

the quality of our employees’ workstations, which obviously included ergonomics.


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Training and education

As part of our objective of ‘Enabling your business’, we feel it is very important for our employees

to be able to add value for both suppliers/manufacturers and dealers/customers. We therefore make

a point of encouraging our employees to pursue the appropriate training and education to help them

further develop their skills as part of an ongoing process within our company.

Safety

We aim to prevent any form of personal injury and/or damage to the health of our employees and

continue to develop initiatives to this effect. See also the section of Corporate Social Responsibility.

Absence management

Based on both cost considerations and our commitment as an employer, we maintain a strong

absenteeism, sickness absence and reintegration policy in order to ensure that employees can return to

the workplace as soon as possible. We refer to this process as ‘reintegration from day one’. Employees

who are absent for extended periods of time can count on individual support. If no satisfactory

solution can be reached for the employee at our company, reintegration into a new position at another

company may be a possibility. We draw on our network to assist employees in these effort.

Corporate Social Responsibility

Introduction

We continued to focus on Corporate Social Responsibility (CSR) in 2013. We began making a list of all

activities relating to CSR within the various companies, as summarised below. This summary features

the ‘three Ps’ – People, Planet and Profit. The ‘P’ for Profit has already been discussed in the financial

overview above. Our general CSR objective is to establish a financially solid company whose profits

are substantial enough to invest in sustainable innovations and social responsibility.

While making our list, we discovered that a large number of our activities already comply with

key aspects of corporate social responsibility, but that they were not explicitly specified as such

previously. Once our list was in place, we began drafting our CSR policy. The next step will be to

develop a policy plan this year and translate this into specific plans.

Vision

With more than nine billion mouths to feed by 2050, production per hectare will need to be increased

in areas where land is scarce. This requires highly effective production methods and machines. Areas

with lower levels of development than Western Europe will show a delayed demand for high-quality

machines and equipment.

The global population growth will see both a rise in the demand for (more efficient) equipment and

machinery in the agricultural segment and a growing demand for logistics solutions (a demand met by

material handling), along with a growing need for high-quality infrastructure (in the civil engineering

industry).

An absolute condition if we are to still have a viable planet Earth by 2050 where all these people can

live and work is to improve the sustainability of resources and processes.

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Mission

Royal Reesink uses its innovative capacity to provide the most efficient and sustainable solutions for

customers, aimed at ease of use, low total cost of ownership, and building long-term relationships.

ENABLING YOUR BUSINESSObjectives

Increasing the sustainability of our own organisation and – even more importantly – supporting our

suppliers and buyers in making the value chain as a whole safer and more sustainable.

Royal Reesink is customer-oriented, offers a one-stop-shop where possible, is an accredited training

company which puts safety and security first, and aims to become a thought leader in the long term

when it comes to sustainability across the supply chain as a whole. Our employees are proud to work

for a sustainable company and feel a strong commitment to Royal Reesink. Our customers are partners

who know they can count on Royal Reesink, while principals are pleased to be represented by our

company.

Status

Our organisation represents transparency, ethical behaviour and compliance with laws and international

behavioural standards. We conduct our business with honesty and integrity and with respect for the

interests of all stakeholders.

We aim to, and will, closely monitor compliance with international standards in all our business

dealings. A code of conduct is currently being drafted for the organisation as a whole in order to

identify our priorities

Reesink Equipment

General details

Reesink Equipment focuses on many different aspects of sustainability, in some cases with a very

deliberate objective in mind and in other cases from a practical and business perspective.

Those operating in the agricultural industry are aware that, in view of the expected population growth

and shrinking amount of agricultural land, innovations relating to sustainability will be (and in some

cases, already are) a licence to operate.

In the civil engineering sector, contractors are rewarded for sustainability in procurement processes.

In order to play a leading role in these processes, it is essential that the materials we supply comply

with the sustainability requirements set.

In material handling, the increase in the number of online orders will see a significant change in the

network of collection points, and the structure of this network will improve. Examples of these changes

include the emergence of mega-hubs and local hubs. This requires efficient logistics solutions, in which

forklift trucks combined with IT resources will play a significant role. Using resources as sustainably

as possible – with a major emphasis on emission reduction – will be the new standard in this sector.


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People

Several of our businesses are certified training companies and provide practical internships where

young people are challenged and inspired. This entails a partnership with secondary schools, regional

training centres and higher vocational institutions.

The organisation works with a system of personal development plans. Irrespective of position or age,

all employees of the organisation can, and are given the opportunity to, further develop their skills

and talents. Individual employees are assessed in order to determine the most effective development

plan.

The majority of our businesses are certified by the VCA (Vehicle Certification Agency). The certification

process has improved the safety culture at Royal Reesink and has allowed us to create a new, more

vital safety environment. Safety inspections are scheduled on a regular basis, while we also discuss

safety issues with clients and provide solutions where required and where possible.

Various innovations have made it easier to further improve the working conditions of the members

of our staff operating equipment and machines, including the installation of air-conditioned cabins

and effective ergonomic layouts. We have also made significant progress in terms of safety, including

both the protection of machine operators and road safety. We have reduced risk for other road users

by improving drivers’ sight (sometimes through the use of cameras), protective covers on sharp

protrusions and safer wheel wells.

Planet

Not all our companies are currently at the same level in terms of sustainability. One of our companies

is ISO 14001-certified; another recently received an ISO 14001 pre-audit. The objective is to learn

from each other’s best practices and raise the level of Royal Reesink as a whole in the process.

At one of the companies, the existing lighting system was recently replaced with LED lighting fixtures.

This will result in energy savings of 33%, and there will be an option to further implement this system

across the company. The same applies to a track-and-trace system which was implemented, aimed

at green driving, with which all delivery vans and passenger vehicles are equipped at some of our

companies.

Increasing the sustainability of our equipment and machinery is a trend across the board. Reduced

emissions thanks to state-of-the-art engines are only part of the story: other driver components

of tractors and machines must also work in perfect unison. This helps reduce internal losses and

increase the efficiency of the machines as a whole. Another significant focus is providing training to

our drivers, to ensure they can get the maximum performance from the machine while consuming as

little fuel as possible. Other examples include the use of automated GPS systems and telemetry. The

GPS systems are roughly 5% more accurate than the most skilled drivers when it comes to overlap

in soil-tilling, fertilising, sowing and harvesting activities. This gain is reflected in the reduced use of

fertiliser, sowing seeds, and the reduced time used by people and equipment and materials. Telemetry

has made logistics coordination more efficient, as well as reducing waiting times during supply and

removal, thereby increasing the capacity utilisation of people, equipment and materials

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Rotterdam, 11.30 a.m. Royal Reesink is there for you – anywhere, anytime

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Reesink Industries

General details

The scope of the list was initially limited to Reesink Staal – this company can clearly make a difference.

The CSR policy plan naturally also incorporates Safety Centre International and Motrac Hydraulics.

Reesink Staal and its partners – including steel producers, steel traders and distributors, architects

and construction companies, steel builders, steel processors and end users – are actively engaged in

increasing the sustainability of the supply chain. The partners are currently working on establishing

the CE certification, which will provide industry players with complete traceability of the products and

allow them to guarantee the quality standards to their customers.

People

Royal Reesink regularly uses the services of interns in both the warehouse and the office, as well as

participating in a municipal project for young people from disadvantaged backgrounds, who are given

the opportunity to acquire work experience within the company.

Planet

Building with steel reduces construction time, which in turn – particularly in city-centre

construction projects – reduces noise nuisance and environmental damage, as well as producing no

construction waste. All materials have been prepared at the production facility to facilitate fast

installation at the construction site. As an added benefit, this type of indoor activity also tends to be

more appealing to construction workers.

Virtually all steel construction products are produced using scrap metal as the basic ingredient. Other

parts are upcycled, since old scrap metal (produced 30 to 50 years ago) can be used to produce

significantly more high-quality steel. There are no other construction products made from stone,

cement, plastic or wood which are upcycled.

Studies have demonstrated that steel hasrelatively little impact on the environment, which means it

scores high as a material based on sustainability considerations. The NIBE materials manual therefore

lists steel products in the first category.

This knowledge of sustainability is highly significant for stakeholders in the construction and steel-

processing industries.

The steel supply chain commissions its own steel building expert institute, Bouwen met Staal, to

conduct studies relating to weight efficiency resulting from the use of higher-quality steel types and

flexible construction, which increases buildings’ adaptive capacity. This means that systems can, in the

long term, be adjusted in order to comply with new requirements, resulting in an increased lifespan

and reducing carbon emissions in steel processers’ production processes.

Reesink Staal uses green, environmentally friendly production processes, including by using

environmentally friendly primers. It also uses a cleaning system for its painting operations which

reduces both water consumption and the amount of residuals. The company prefers to source from

businesses with environmental certificates.

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Main points and outlook for 2014

●● Balanced growth of the various Reesink Equipment divisions, with a focus on opportunities to expand

our product range, particularly with current suppliers such as Claas, Kuhn, Amazone and Linde.

Our own in-house brand, Kaweco, provides opportunities for further growth, both horizontally and

geographically, as well as by partnering with new suppliers for other market segments such as the

mechanisation of the potato production.

●● Integrating acquired companies into Royal Reesink.

●● Achieving short-term synergy benefits in relation to supply chain management, procurement, cross-

selling and cross-rental.

●● Further expansion of partnerships with dealers, including participations and other types of

cooperation.

●● Focus on expanding the Claas activities in Kazakhstan.

●● Reesink Industries has made manufacturing partnerships a key focus by giving priority to engineering,

offering processed products and semi-finished products.

Based on the company’s current status and structure, we see many opportunities to further strengthen

our position. We expect Reesink Equipment to achieve strong growth in revenue and profit. We aim

to balance the three equipment divisions with each other in terms of growth. On the ‘green’ side, in

particular, we are always on the lookout for valuable new ways to help us improve our position in a

number of market segments.

The steel business in the industrial segment has been sufficiently restructured in order to allow

us to benefit from the improving market. The year 2013 was a challenging one for Safety Centre

International, although here, too, the company gets to profit from an improved market. We also see

growth opportunities for Motrac Hydraulics, although in terms of operations – particularly in Germany –

we will need to implement a number of performance-improving measures.

Final note:

We managed to improve our economies of scale to such an extent within just one year that we have

built an even more solid foundation for the future, which has created a type of flywheel effect. These

greater economies of scale have increased our appeal among various stakeholders.

Developments in early 2014

CT Agro

The acquisition of the CT Agro GmbH business was completed in early January, including the

acquisition of 100% of the shares in the Kazakhstan-based company CT Agro TOO. This has provided

Royal Reesink access to Kazakhstan, a country with immense growth potential which is an interesting,

major potential sales market for Royal Reesink.

Kazakhstan is the size of all of Western Europe, and, with an area of 2,724,900 square kilometres,

it is the eighth-largest country in the world (by way of comparison, the Netherlands has an area

of 41,528 square kilometres). With a population of less than 17 million, it is also one of the most

sparsely populated countries in the world. The east, north and south of the country have an enormous

amount of agricultural land, and a total of 20 million hectares are used for arable farming. Farm size

ranges from 500 to 200,000 hectares, with some farms exceeding even this size. The country has


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undergone a large number of advances in recent years, and the agricultural industry, in particular, aims

to strongly increase its efficiency.

CT Agro serves the market from its head office in Germany. The company uses export loans and

partners with major leasing companies. In addition to Claas, CT Agro also offers several other

high-quality brands, which the company will continue to represent in the future. The company’s

wholly-owned subsidiary CT Agro TOO maintains 10 sites in Kazakhstan, where its qualified employees

support end users by providing services and parts. CT Agro employs a total of around 100 people,

including a multilingual management staff. The company posted profitable revenue of around

€ 40 million in 2013.

We expect to be able to increase the number of service points in the future, and will also be

introducing other Reesink Equipment products groups in this market. We also see opportunities for

Motrac Hydraulics.

Increase in credit facility

In early January, Royal Reesink also reached agreement with ABN AMRO, Rabobank and Commerzbank

regarding the joining of Commerzbank of the group of financing banks and the increase in the credit

facility from the original amount of € 90 million to € 110 million.

Earn-out fee

The variable purchase price of the shares in PMH-E, including interest, is € 18.2 million. Once the € 0.7

million in fees agreed with Pon Holdings B.V. for contractual provisions have been deducted, an amount

of € 17.5 million will be financed in early April 2014. This will occur by increasing the subordinated

convertible loan contracted with Pon Holdings B.V. by € 7.5 million; a € 4.8 million subordinated loan

contracted with Pon Holdings B.V.; and through € 5.2 million from the available bank facility.

Improving the organisational structure and achieving synergy effects

The management devoted much of its efforts during the first few months of 2014 to exchanging

knowledge and best practices. In terms of operations, the organisation will focus on strengthening HR,

IT, Finance and Communications. We developed a campaign – set to be launched in the second half

of the year – at both the corporate and business levels to position Royal Reesink as a strong brand.

From a sales perspective, a number of interesting leads have already been exchanged between the

divisions, and cross-selling and cross-rental are actually resulting in additional revenue.

The current size of our company and our cooperation have also given us a stronger negotiation

position, including terms and conditions of purchase and agreements relating to financing and leasing.


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Ootmarsum, 10 a.m. Royal Reesink is there for you – anywhere, anytime

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Reesink Equipment

2013 revenue – Reesink Green Equipment 2013 revenue – Reesink Green Equipment

Geographic

Service/parts

Rental

Sale

Other EU/non-EU

Belgium

Germany

The Netherlands

REESINK GREEN EQUIPMENT

Our companies operate within Reesink Green Equipment (RGE) as distributors of leading brands for

agriculture, horticulture and landscape maintenance. The products are supplied – mainly through

dealers – to farmers, contractors, landscaping companies, golf courses, municipalities, governments,

water boards and foresters. This division is subdivided into two departments: Green Equipment

and Kamps de Wild Holding (using Chinese Walls, in order to be able to compete with rival brands).

General trends and developments

Agricultural industry

According to data provided by the Landbouw Economisch Instituut (Agricultural Economics Institute at

Wageningen University/LEI), the income of the average farmer fell by 2.5% in 2013. The income of dairy

farmers rose sharply, mainly due to the higher milk prices. The dairy cattle population is expected to

grow by approximately 15 to 20% between 2010 and 2020, driven by high demand from China, Russia

and other emerging economies. As long as these countries cannot produce sufficient high-quality dairy

products themselves, Dutch farmers stand to benefit. In view of the elimination of the dairy produce

quota in 2015, cattle farmers are investing mainly in expanding their stables. The income earned per

farm operating in the arable farming industry was less than the record year 2012, but nevertheless

significantly higher than in the years prior to 2010. There are a number of substantial differences

between the various farms. The lower-income farms tend to be smaller and are unable to benefit from

economies of scale. Farmers sowed and planted later than usual on account of the long winter, and

crops took a longer time to grow. The revenues per hectare of wheat and barley exceeded those for

2012. However, per-hectare production for other arable crops was lower. The production of consumer

potatoes was roughly equal to that for 2012 on account of the larger agricultural land area. Due to the

drought at the end of the season, per-hectare sugar production (for sugar beets) remained somewhat

lower. Onion production fell by an estimated 15%. Investor interest in arable farming was strong this

year. Investment in hay-making machines was 20% lower while investment in tractors was 5% lower,

especially as sales did not gain momentum until later in the year. Sales are expected to catch up in 2014.


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As in 2012, contractors were affected by a lack of liquidity and investor reluctance. The financing

programmes – including vendor leasing and stock finance – which we provide in conjunction with

major leasing companies can potentially provide a solution in this situation.

The year 2013 was an exceptionally good year for the principals. This applies to virtually all brands,

including Claas, Amazone, Kuhn, Toro and Rauch. These brands also invested a large amount of money

in development and innovation.

Landscape maintenance and forestry, park and garden management

The situation has not changed significantly since 2012, with governments remaining cautious and

golf courses continuing to struggle. The latest trends and developments were revealed at the National

Golf Conference, which was held in Maarssen in the province of Utrecht on 11 February 2014. The

number of rounds played continues to decline across the board; the total number of rounds fell

by 8% in 2013. On the upside, the number of golfers in the Netherlands has grown again somewhat:

by several percentage points to 390,000 registered members. The golf sector is attempting to turn

the tide and has implemented a number of measures. For one, the controversial golf diploma was

cancelled, and the threshold for new members joining continues to be lowered. In addition, member

fees are also becoming more flexible.

2014

The mood for 2014 is optimistic as far as agriculture is concerned. Prices in arable farming remain

high, as do milk prices. The (cautious) estimate is therefore that financing levels will improve. However,

demand in the Netherlands for larger harvesting machines will remain low.

Trends and developments

GREEN EQUIPMENT

Green Equipment serves companies which operate as distributors of leading brands such as Kuhn,

Rauch, Toro, LM-trac, TYM, Club Car and Ditch Witch for agriculture, horticulture and landscape

maintenance. The products are supplied – mainly through dealers – to farmers, contractors,

landscaping companies, golf courses, municipalities, governments, water boards and foresters.

Several Green Equipment companies suffered as a result of low investor appetite. The year 2013 was

a reasonable year on the whole. However, landscape maintenance (as a result of government cuts) and

dairy farming remained somewhat behind, but arable farming made substantial investments.

A key priority for all companies was the organisation of the future distribution model.

Kuhn focused, in particular, on how a specialist operating in a market – in which full-liners are

providing an increasingly comprehensive package of services – can add value. Our companies

are currently in the middle of this process. The conclusion will most likely be that there will be

more direct contact with end users in the future, albeit through a dealer organisation. Due to the

more complex and specialised machines combined with increased automation, the related issues

have become more complex and result in a greater need for customised solutions. More often than

not, distributors are better equipped to provide such solutions than dealers, which do not possess

the same specific knowledge. Looking back on the past few years, the company has undergone a


Roden, 2 p.m. Royal Reesink is there for you – anywhere, anytime

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major transformation from a sales organisation to an organisation focusing on knowledge transfer

in the broad sense of the term. The Kuhn Centre, located in Apeldoorn, has significantly boosted this

development.

We are also seeing a greater need for specific knowledge in the market in which Jean Heybroek

operates. Jean Heybroek is directly responsible for marketing in a number of product segments. This

is certainly relevant to golf courses, as this market still has only a number of large, specialised players.

Toro has launched a large number of new machines in the past year, thereby further increasing its

already substantial market share.

KAMPS DE WILD HOLDING

Kamps de Wild Holding serves farms with four brands. Claas, which focuses exclusively

on the agricultural industry, is one of the leading manufacturers of self-propelled forage

harvesters In addition, the product range also includes tractors, system tractors, hay-making

machines, loader wagons, presses, integrated baler wrappers and telehandlers. Amazone supplies

products for the entire process from soil tillage to harvest preparation (including soil tillage

machines, fertiliser spreaders, sprayers and seed drills). Kaweco, Kamps de Wild’s home brand,

provides a comprehensive range of fertilisers for grass land and arable land, tank transporters,

forage wagons/silage systems (RADIUM) and dual-purpose forage wagons (THORIUM).

Weed-it is a device that controls weeds on hard and semi-hard surfaces in an environmentally

friendly and selective manner.

Kamps de Wild Holding experienced strong sales in large harvesting machines. Nevertheless, the

company was affected by investor caution among dairy farmers.

Kamps de Wild Holding has likewise chosen to concentrate technical knowledge and experience, making

it possible to generate volume and provide support in the maintenance of large, technically complex

machines. The company has therefore partnered with six major full-line dealers which represent the

product range as a whole, including the provision of service and supply of parts. These large full-line

dealers serve as expertise centres for the region as a whole. The approximately 70 long-line dealers

can use these services for the large harvesting machines if necessary.

In order to further implement this strategy, Landtech Zuid – a new subsidiary of Kamps de Wild

Participaties – has acquired a portion of the business of Jans-VanGemeren Mechanisatie B.V. Having

started out as a dealer distributing the Claas, Amazone and Kaweco brands for the Central Brabant

region, Landtech Zuid currently serves as a regional expertise centre. The product range also includes

other brands, in order to be able to offer a comprehensive package.

Kon ink l i j ke Rees ink N .V. Annua l Repor t 20135 65 6 Kon ink l i j ke Rees ink N .V. Annua l Repor t 2013

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Reesink Construction Equipment2013 revenue – Reesink Construction Equipment 2013 revenue – Reesink Construction Equipment

Geographic

Rental

Service/parts

Sale Other EU/non-EU

Belgium

The Netherlands

Reesink Construction Equipment (RCE) provides a comprehensive range of earth-moving equipment

and related products for the civil engineering industry, operating from its five sites across the

Benelux region. RCE’s competitive advantage is based on the high level of the services provided.

The range includes premium brands such as Kobelco, Atlas, Terex, IHI, KATO and Canycom. In

addition, RCE also manages a fast-growing rental division, Huur&Stuur: a company operating in the

Netherlands and specialised in leasing self-propelled earth-moving equipment. The company also

specialises in various types of equipment.

2013


Following substantial growth of 23% in 2011, the European construction equipment market shrank

by 4% in 2012, with the number of machines sold continuing to decline in 2013. The Netherlands has

not fared any better; performance in Belgium, however, has been above average. Despite these self-

evident facts, 2013 was another good year for RCE.

Reesink Construction Equipment

The integration of Hans van Driel (which was acquired in early 2013) and the merger with the Kemp

Group under RCE were two of the main developments last year. Hans van Driel saw a number of

personnel changes, improved its brand identity both onsite and in the market, and began focusing on

marketing to end customers directly. These measures have enabled RCE to present itself to the outside

world as a lean organisation strongly focused on aftersales, with many opportunities for synergy on

the sales side. Dealers and end customers receive first-rate service from the three main sites (Tiel and

De Meern in the Netherlands and Hamme in Belgium) and two additional branch offices (in Ommen

and Bergschenhoek, both located in the Netherlands).

The global brand Kobelco was added to the existing, strong range of brands, including Atlas, Terex and

IHI at the end of 2013.


Haarlo, 10 a.m. Royal Reesink is there for you – anywhere, anytime

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Marketing efforts have increased for the crawler excavator of the latter brand. Kobelco is the leading

brand in technology, design and fuel efficiency, and therefore has lower carbon emissions than

similar machines. This means that RCE has become an interesting supplier to leading major

contractors which have made carbon emissions and environmental issues a priority. The relocation

of Ditch Witch to De Meern, as reported last year, has already resulted in a number of different

benefits. The De Meern site offers Saturday opening hours and a high-quality facility in terms of logistics

handling. Ditch Witch customers also tend to be customers or potential customers of Huur&Stuur, and

vice versa. Many customers who visit the Ditch Witch site also end up picking up a mini excavator

offered by Huur&Stuur.

Investor appetite remained low in the Netherlands in 2013. We did, however, see cautious signs of

recovery in the civil engineering industry, a sector in which RCE has a large number of customers.

Based on the substantial growth of the Huur&Stuur business, there was no shortage of contracts in

this area. Notwithstanding the long and harsh winter, revenue increased substantially in this segment.

There were no signs of a crisis in Belgium, where the company experienced a very strong year with a

highly unexpected peak in revenue. The year was satisfactory all around.

End-of-year show

RCE welcomed more than 5,000 visitors to its end-of-year show, held on 27 and 28 December, where

it exhibited the Claas, Ditch Witch, Toro and Linde brands in addition to its own brands. All of these

brands are solid, leading brands with decades-long histories. This also presented the company with

the ultimate opportunity to demonstrate the extensive Royal Reesink product range. The strategy of

offering a variety of product groups and brands has boosted our industry immensely. The partnership

has also received great positive feedback within the company.

2014

A number of projects have been green-lighted for 2014, not only for Huur&Stuur and aftersales, but

certainly also in terms of sustainable investment. A potential recovery in the civil engineering sector

will allow the company’s sales to pick up again and eliminate any previous losses. An additional

factor is that the market has been decimated as a result of a large number of bankruptcies, and many

machines have been sold to foreign countries at auctions. This means that even a modest recovery will

have a significant effect on the sales of earth-moving machines. Thanks to its strong brands, RCE is

well positioned to benefit from this situation in full. It is expected that sales in the Belgian market will

remain at the 2013 level. Sales were so strong last year that the company is unlikely to top this record.

Kon ink l i j ke Rees ink N .V. Annua l Repor t 20136 0 Kon ink l i j ke Rees ink N .V. Annua l Repor t 20136 0

Apeldoorn, 1 p.m. Royal Reesink is there for you – anywhere, anytime

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Reesink Material Handling Equipment2013 revenue – Pro Forma Reesink Material 2013 revenue – Pro Forma Reesink Material

Handling Equipment Handling Equipment Geographic

Rental

Service/parts

Sale

Germany

The Netherlands

Other EU/non-EU

Belgium

Reesink Material Handling Equipment (RMHE) has been a leading company for more than 60 years

as a comprehensive provider of internal logistics and cleaning solutions. The company provides

its customers with the best possible services from its sites in Almere, Zwijndrecht, Antwerpen

(Belgium), Flémalle (Belgium), Kerpen (Germany) and Köln (Germany). In the Netherlands, Motrac

Intern Transport B.V. is the distributor of the premium brand Linde forklift and warehouse trucks;

in Germany, the distributor is Pelzer Fördertechnik GmbH. In Belgium, Motrac Handling & Cleaning

NV/SA is the distributor for both the Linde brand and the Tennant cleaning equipment brand.

2013


The forklift market is a highly competitive market, and the year 2013 was no different.

Material handling

The year 2013 was a good year from a financial perspective, despite the continuing low investor

appetite among customers. The strategic reorientation, as defined in 2011, clearly began to pay off.

The companies have since begun to make service a priority, with a greater focus on total revenues

during a product’s complete lifecycle. The rental division experienced a strong year as well. The

contracts signed in this division are highly flexible, with terms ranging from one day to 60 months.

The RMHE companies are particularly progressive in this area, collectively managing one of Europe’s

largest rental fleets. If investors are more cautious but contracts are nevertheless being signed, rental

activity tends to increase.

This was also a good year for the used-machine market. RMHE conducts extensive business with

companies that sell used machines in both Europe and Asia, which makes it possible for the company

to generate strong profits despite the lower economic activity in Europe. As in previous years, RMHE

was able to attract a large number of major new logistics customers this year. The company managed

to maintain its traditionally high market share in trucks with combustion engines. RMHE increased its

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market share in electric trucks in both the Dutch and Belgian markets. The situation in Germany has

remained stable.

Particularly as a result of the improved service-contract end and the strong business in rentals, the

financial results were not only better than in 2012, they were actually also better than projected.

RMHE is therefore on schedule with its strategic reorientation.

Since the company ultimately generates its income from operations, any strategic reorientation must

be paired with a focus on improving operations; this has been an ongoing effort in recent years. One

area of focus in this respect has been increasing the percentage of trucks leaving the workshop on a

‘first-time right’ basis. Trucks require 30 to 40 hours of work before they leave the workshop. There

was clearly some room for improvement here in the past: a poor performance in this area costs money,

and, what’s worse, causes customer dissatisfaction. The first-time-right percentage was approximately

95%. Another example is the safety and security policy. By proactively mapping high-risk areas and

taking action where necessary, we can reduce the number of accidents as well as rates of long-term

absenteeism.

Added value

Creating added value in our customers’ supply chain is essential and enables RMHE to perform

well even in tough economic times. The company has two core competencies: a) knowledge and

understanding of the revenue models of our customers, and the consequences this has for the supply

chain; and b) knowledge of internal transport systems and products, and an understanding of how

these can provide a solution for customers’ questions relating to logistics and/or the supply chain.

We therefore do not always necessarily aim for the largest number of trucks, but rather for the best

solution, even if this means less revenue for RMHE. Our field force of 300 highly qualified mechanics

and approximately 50 schedulers manage everything on behalf of their customers, so that the latter

can focus on their core business. This enables us to build long-term relationships with our customers.

Cleaning

RMHE is the distributor for Tennant cleaning machines in Belgium. The activities are divided into two

areas: industrial cleaning (IC) and business cleaning (BSC). Industrial cleaning grew substantially in the

past year. Business cleaning lagged somewhat behind, mainly due to delayed demand. The number

of customers served in this market actually increased further in 2013. However, this growth was

insufficient to be able to compensate the average decline in revenue per BSC customer.

Acquisition by Royal Reesink

The acquisition by Royal Reesink provides significant opportunities. On account of RMHE’s relatively

large stake in Royal Reesink, the focus is on these activities more so than in the past. The two cultures

are also well matched: both companies have no-nonsense cultures and have their feet firmly on

the ground. There are various opportunities at Royal Reesink for cross-selling. Although the three

equipment divisions each have their own specific focus, the marketing efforts focus on adjacent

markets where there is a clear overlap. For example, farmers and contractors tend to use forklift trucks

alongside tractors and excavators. MotracLinde’s representation at the Kemp Group’s end-of-year

show with Linde forklift trucks presented the perfect opportunity for the Kemp Group to demonstrate

Royal Reesink’s comprehensive product range, as well as enable RMHE to discover new markets.


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2014

Handling

The continuing competitiveness of the market means that profit margins for new-machine sales will

continue to fall. Since the foundations of the companies have grown stronger in recent years, a further

growth in market share is anticipated. In 2014, the focus will remain on services provided during

products’ entire lifecycles. Operations will be further improved and developed in 2014, because only

continuous improvement provides a sustainable basis for creating growing value for customers. In

particular, the company expects to grow its service activities and the related sale of parts. Rental

activities are expected to remain at the 2013 level.

Cleaning

The market is generally expected to improve slightly over 2013, driven mainly by a stronger BSC

market. There will be opportunities for the BSC segment to grow further in the coming years.

Additionally, Tennant will also further develop its ‘green cleaning’ activities. Based on the above, the

company will have sufficient resources to achieve the expected growth.



Zutphen, 10 a.m. Royal Reesink is there for you – anywhere, anytime

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Reesink Industries2013 revenue – Pro Forma Reesink Industries Geographic

The Netherlands

Other EU/non-EU

Germany

Belgium


As in 2012, there was no improvement in the construction industry. Although some improvement

is expected for 2014, the sector is not likely to truly pick up before 2015, when housing production is

expected to increase by 17%. During the period from 2016 to 2019, construction output is expected to

grow by an average of 10.5% per year, according to the Economic Institute for the Construction Industry

[Economisch Instituut voor de Bouw] in its report Verwachtingen bouwproductie en werkgelegenheid

(‘Projections for construction output and employment’), which was published on 29 January 2014. The

aftermath of the crisis is still evident this year, and housing construction output will fall by another

7%. According to the Economic Institute for the Construction Industry, the number of homes to be

completed this year will reach 45,000, compared with the pre-crisis level of 80,000. Housing output

is expected to rise to 75,000 again by 2019. The long-term demand for homes is 70,000 per year. We

are also seeing a growing demand for distribution centres.

These positive figures provided by the Economic Institute for the Construction Industry do not factor

in any delayed demand to compensate for the lack of demand in recent years. This was due in part to

the crisis and in part to the current government policy of debt reduction, the reduction in the mortgage

interest relief, more stringent credit requirements and – especially – the long-term uncertainty

regarding a number of measures. However, there appears to be a turning point: the number of home

sales is increasing, prices are stabilising, and there has been a slight improvement in contractors’ order

books. We are witnessing recovery across the board.

REESINK STAAL

Reesink Staal markets rolled steel and offers a wide range of girders, pipes, bars, profiles and

sheet in a large variety of sizes. We are responsible for creating the product range, de-bulking,

maintaining stocks and distribution, and based on customer specifications this is supplemented with

steel processing. Activities involve forming, sawing and jig-sawing, drilling, cutting, sandblasting

and coating. Reesink Staal increasingly focuses on manufacturing partnerships.

2013

The company is starting to reap the benefits of the radical reorganisation completed in 2012 and of

the concentration of operations at the Zutphen site. However, the dramatically lower profits in the

market due to overcapacity are proving a barrier to further recovery.

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Reesink Staal has made processing one of its core activities. The company performed well in the past

year as a partner for a number of companies, which has reduced costs in the supply chain. In addition,

there are also opportunities for cross-selling at Royal Reesink, for example steel for the frames of

power packs manufactured by Motrac Hydraulics.

A new ERP package was implemented in early 2014. In addition to sales, purchasing and logistics,

the warehouse as a whole will be automated as well. This means the organisation will soon be ready

for the mandatory CE certification to be introduced in the course of 2014. In the future, suppliers

must be able to provide CE certifications for all products they supply. This certification ensures full

traceability of the materials and equipment used. This may be useful in preventing disasters and in the

investigation of the causes of these disasters. Reesink Staal is currently a pioneer in this area. There

are a total of four certification categories. The first two categories represent non-complex applications

and bulk materials. Class 3 involves applications for high-rise construction, government buildings and

other buildings involving more than one type of pressure on the material used. The fourth category

is reserved for applications in the offshore industry. The company’s aim is to reach category 3, which

will give Reesink Staal an edge over many peer companies and allow it to become a niche player in

an interesting market.

2014

We expect that the steel market has bottomed out and will start slowly improving from 2014 onwards.

SAFETY CENTRE INTERNATIONAL

Distributor/wholesaler Safety Centre International (SCI) specialises in the sale of work shoes,

work clothing, other personal protective equipment (PPE) and health and safety products. These

items are used in the construction industry, industrial work environments, and other areas. The

comprehensive range includes premium brands such as Bata Industrials, CRAFT Functional Wear,

MAMMOET Workwear, PROJOB Workwear, Wock Shoes and Mapa safety gloves. SCI aims to be the

exclusive provider in the segments in which the company operates. It also provides online VCA

courses (Safety Certificate for Contractors). SCI sells its products exclusively through an extensive

business-to-business dealer network.

2013

SCI, which is celebrating its 20th anniversary this year, relies on strong premium brands (‘the best

brands for business’), which guarantee continuity. The activities are also strongly linked to the

construction industry, which has been struggling. This inevitably affected revenues, particularly during

the first half of 2013. At the same time, SCI has noted that customers continue to opt for the security

and sustainability of leading brands such as Bata Industrial and CRAFT. Bata Industrial recently

launched an all-new concept based on application-based concepts. Its shoe range has been adapted to

specific segments, including heavy industry, the chemical industry and the agricultural and automotive

industries. This is also based on the conditions in which the shoes are worn. This represents an entirely

new approach, which has been well received in the market. CRAFT increased its product range this

year with layers 2 and 3, the layers worn over underwear. The feedback has been positive.


Kampen, 3 p.m. Royal Reesink is there for you – anywhere, anytime

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2014

The market will continue to struggle for a while, but the foundation is solid, and as soon as the market

improves, the company will be able to benefit. The construction industry will likely remain lacklustre

in the coming year, but, based on current projections, the outlook is a great deal more optimistic for

2015 and beyond.

MOTRAC HYDRAULICS

Motrac Hydraulics and its expert staff have been providing hydraulic solutions for 60 years,

including engines and complete power packs or integrated hydraulic, mechanical and/or electronic

systems for the agricultural, manufacturing and automotive industries. The company also has a

growing number of clients in the maritime, offshore and mining industries. Motrac Hydraulics

always works on a partnership basis, and if required the company’s engineers are temporarily

assigned to the client’s design department, or in a specially composed project team. This makes it

possible to identify customers’ needs and requirements in as detailed a way as possible in order

to provide maximum quality. This quality guarantees customers business security and reduces

total operational costs. Professional expertise, flexibility and direct lines of communication with

engineers result in strategic end results.

Motrac Hydraulics uses pumps, engines and parts of the highest quality, and always has these in

stock. This means our customers are always secure in the knowledge that they will receive high-

quality products and that these products will be delivered very fast. If necessary, the supply of the

components and systems will be fully adapted to the customer’s supply chain.

2013

Motrac Hydraulics serves three types of customers, each based on separate dynamics. These customers

are described below.

● Traditional customers, which we refer to as our ‘trading activity’. Since we are the distributor of

Linde Hydraulics in the Netherlands, Belgium and Germany, we supply components directly from

customer stock. These customers typically phone in their orders, after which the products are

shipped without any further processing taking place. The year 2013 was particularly challenging for

this activity, on account of the weak economy.

● OEM customers, including manufacturers of street-cleaning machines, which involve a great deal

of hydraulic technology. By providing input (engineering) and solutions to customers aimed at

improving machine efficiency, we can often provide comprehensive hydraulic systems. This activity

– which is all about adding value – continues to grow, and this was certainly the case in 2013.

A portion of our clientele consists of manufacturers of agricultural machines, and they value the

type of solution-oriented thinking which results in more efficient engine technologies.

● Major, long-term (engineering) projects, including hydraulic systems for dredgers. We saw substantial

growth in this sector.

2014

The year 2014 will remain somewhat challenging for our trading activity. Nevertheless, we were able

to build an interesting pipeline of projects in 2013, as a result of which we look towards 2014 with

confidence. There is strong potential for growth, particularly in international projects.


Eindhoven, 2 p.m. Royal Reesink is there for you – anywhere, anytime


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S3 | RISK MANAGEMENT AND MONITORING SYSTEM

The company changed its management structure in 2013 in order to further implement our growth

strategy. Royal Reesink is currently divided into two segments: Reesink Equipment and Reesink

Industries. The Reesink Equipment companies operating in the same markets have been integrated

into the divisions Reesink Green Equipment, Reesink Construction Equipment and Reesink Material

Handling Equipment. Reesink Green Equipment – on account of Chinese Walls, and because this is

necessary in order to be able to compete with rival brands – has been further divided in Green

Equipment and Kamps de Wild Holding. Each division currently has its own director and controller.

The CEO and CFO hold formal meetings every month with the management of the divisions and the

Reesink Industries segment to discuss the implementation of the strategy and objectives and the

performance of the internal risk management and monitoring system within their own companies.

In order to achieve synergies and resolve other strategic issues (among other things), two new

members have joined the Management Board; Mr B. Kemp (RCE) and Mr M. de Bos (RMHE and Motrac

Hydraulics).

The current risk management and monitoring system can roughly be described as follows: the

performance indicators for the trading activities are reported in detail on a day-to-day basis for each

of our companies. The newly acquired companies (RMHE and Motrac Hydraulics) are currently being

connected to this system. A Corporate Performance Management system and a treasury tool to support

management (consolidation and planning) were implemented in early 2014. Each month, the results

achieved (compared against the budget) are reported and analysed, and each quarter projections for

the full year are adjusted if necessary. The periodic management meetings at the division and trading-

company levels are used to discuss in detail current market conditions, financial results, projections,

working capital, investments, the organisation, and risks.

The Management Board of Koninklijke Reesink submits the key performance indicators to the

Supervisory Board on a monthly basis. Each quarter, the Management Board reports to the Supervisory

Our risk management and monitoring system is designed to keep track of the

degree to which strategic and operational targets are being achieved and to

ensure that financial reports are reliable and that the relevant laws and

regulations are complied with. While we are aware that risk is inherent to

business, our policy is aimed at preventing or mitigating such risk, always in

relation to the likelihood that risks may occur, and the resulting impact.

S3

Risk management and monitoring system

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Board on financial reports, notes, and the forecast for the year, and at least once a year it outlines the

company’s strategy and budget.

The Supervisory Board convenes at least five times a year to discuss these reports and other subjects.

The external auditor annually assesses the correct operation of the internal risk management and

monitoring system (if relevant to the audit of the financial statements), and reports its findings to the

Management Board and the Supervisory Board of Royal Reesink. The report for 2013 contains findings

that, while not indicating any major shortcomings, did include recommendations for improvement.

These recommendations have been implemented where possible.

In order to achieve the objectives, the HR, ICT and F&A organisations were strengthened at the strategic

level. At the operational level, the activities relating to HR, ICT and F&A were further defined for each

entity. For the smaller entities, in particular, we believe that a concentration of these activities will

support adequate risk management. The strategic, financial reporting, operational and compliance risks

aimed at the business objectives are identified and analysed on an ongoing basis, and, if necessary,

management measures are implemented in order to control the risks.

The basis of the ICT plan is to align the (ERP) environments. This is a priority in particular for the

equipment companies (with the serial number being central across all divisions). In early 2014, Reesink

Staal will implement an industry-specific ERP system, along with Motrac Hydrauliek, which paved the

way in 2013. The financial accounts will be managed in the ERP systems of the trading companies.

The financial instruments are associated with the risks listed below.

Credit risk

Credit risk represents the risk of financial loss for Royal Reesink if a customer fails to comply with the

contractual obligations entered into. Royal Reesink’s exposure to credit risk is determined primarily by

customers’ individual characteristics. The close contact we maintain with our customers, either as part

of the dealer organisation or otherwise, is important in reducing credit risk. This risk is further reduced

through our own credit checks of (new) customers based on factors such as external reports, annual

reports and payment history, or by insuring credit risk. Internal credit limits, which are determined

based on the company’s own research, are reviewed at least once per year. Customers for whom no

credit limit was issued (either within the company or by the insurer) can only conduct business with

Royal Reesink based on guaranteed payment. Credit insurance was taken out on behalf of Kamps de

Wild and Reesink Staal.

Goods are delivered under retention of title, which ensures that, in the event of default, Royal Reesink

usually has a preferred debt.

At Reesink Green Equipment, there is some concentration of credit risk with debtors, which is mitigated

in part by credit insurance.

Liquidity risk

Liquidity risk represents the risk that Royal Reesink is (temporarily) unable to meet its financial

obligations. The company maintains a number of credit facilities with several banks in order to make


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investments, as well as for the day-to-day management of working capital and liabilities (i.e. letters of

credit). These represent short-term financing facilities. Royal Reesink reduces this risk by assuming a

capital base of 40%, in order to be able to raise additional capital if necessary (on a temporary basis).

Market risk

Market risk represents the risk that Royal Reesink’s income or the value of the financial instruments

held by the company is adversely affected by shifts in market prices, such as interest rates and

exchange rates.

Interest-rate risk

The interest-bearing debts consist mainly of debts to credit institutions, which have a floating interest

rate consisting of (mostly) 1-month Euribor plus a fixed interest premium. In consultation with the

Supervisory Board, the risk of an interest rate increase is not hedged.

The remaining interest-rate risk is limited to any changes in the market value of loans issued. The

majority of these loans have floating interest rates plus a fixed interest premium. Since the loans

are held until maturity, it is the company’s policy not to use any derivative financial instruments to

manage (interim) interest rate fluctuations.

Currency risk

Currency risks are relatively limited, and the policy is to hedge this risk for each separate order.

Capital management

The policy is aimed at maintaining a strong capital position. The financial norm is to achieve a return

of 15% on shareholders’ equity. Factoring in the company’s growth targets, between 40 and 55%

of the profit at the disposal of the shareholders will generally be distributed. This ensures that the

trust of investors, creditors and the market is preserved and that there will continue to be room for

acquisition. ‘Capital’ is here defined as the portion of shareholders’ equity allocated to the company’s

shareholders.

Royal Reesink has hired SNS Securities as a liquidity provider in order to increase trade in its shares,

which have a continuous listing.

The Royal Reesink companies are not subject to any capital requirements imposed by external parties,

other than specified in the financial statements.

The Management Board believes that Royal Reesink’s internal risk management and monitoring

system is adequate and effective, and that the financial reports are free of material misstatement.

Despite our day-to-day involvement in risk management, there is no absolute certainty that material

misstatement, errors, fraud, losses or unlawful acts can be prevented.


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S4 | CORPORATE GOVERNANCE

Royal Reesink believes it is important to include the main features of its corporate governance structure

on its website, in compliance with the amendments to the Code adopted by the Corporate Governance

Monitoring Committee in December 2008. This is based on the Code’s system; the numbers used match

the numbers of the Code.

The following documents are available from the website www.royalreesink.com:

●● Corporate Governance (Royal Reesink’s Corporate Governance policy)

●● Regulations and profile of the Supervisory Board

●● Whistleblowing policy (Share schemeEffectenregeling)

●● Articles of Association

●● Remuneration policy

I. COMPLIANCE WITH AND ENFORCEMENT OF THE CODE

We will include the main features of Royal Reesink’s corporate governance structure in each annual

report. Any substantial changes to the corporate governance structure will be submitted to the

general meeting of shareholders under a separate agenda item.

II.1 MANAGEMENT BOARD

II.1.1 to II.1.11: Duty and procedures

We entered into an open-ended contract with our director in May 2009, which means he was not

appointed for a maximum period of four years. The director and the general meeting of shareholders

have agreed that the former will resign if the latter so requests based on his performance, in a

situation where there is no dominant shareholder but a wish that is widely supported. If the director

were to resign in this manner, this will be deemed to be a dismissal by the company.

As per the recommendation of the Corporate Governance Committee (the

‘Committee’), Royal Reesink has been following the Corporate Governance

Code (the ‘Code’) adopted by the Committee since the 2004 financial year. A

consensus was reached at that time regarding the ‘comply or explain’ meeting

held with the general meeting of shareholders. At the time when the listing

of depositary receipts for ordinary shares on the Euronext index was

replaced with a listing on the Alternext index, it was agreed with the

shareholders that Royal Reesink would continue to comply with the Code in

the manner applicable on 10 May 2006.

S4

Corporate Governance

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At Royal Reesink, it has long since been the tradition for the Supervisory Board and the Management

Board to adopt the company’s operational and financial objectives by mutual agreement. The same

applies to the strategy to be followed and the preconditions to be applied, which also includes a focus

on the social aspects of business that are relevant to the company. We will continue to include the

main issues in our annual report.

Royal Reesink maintains an internal risk management and monitoring system geared to its operations.

The annual report demonstrates that, and how, the internal risk management and monitoring system

is adequate and effective, as well as containing information on the performance of this system in

the past financial year. The risk management policy is a permanent part of the periodic planning and

monitoring policy.

Royal Reesink maintains a whistleblowing policy, under which employees can report on alleged

irregularities of a general, operational or financial nature within the company and its subsidiaries

without compromising their legal position. If and to the extent that the report relates to the actions

or omissions by members of Royal Reesink’s management under the articles of association, the report

must be made to the company’s director. However, if the report concerns the actions or omissions of a

member of the company’s management under the articles of association, the report must be submitted

to the chairman of the Supervisory Board. Before an employee can claim that his or her legal position

has been jeopardised as a result of a report as described above, the chairman of the Management

Board must provide a written assessment (previously a report not directed against a member of Royal

Reesink’s Management Board under the articles of association) or the chairman of the Supervisory

Board must provide a written assessment (previously a report directed against a member of the

above-mentioned management under the articles of association). The written assessment must be

submitted within six weeks following the request concerned.

Royal Reesink’s director under the articles of association is not a member of any supervisory boards

of listed companies. The director’s contract provides that the consent of the Supervisory Board is

required in order to accept any other positions in the private sector.

II.2.1 to II.2.15: Remuneration

Options – whether conditional or otherwise – and shares do not constitute pay components at Royal

Reesink for the time being. The Supervisory Board has drafted a remuneration policy in accordance

with the relevant best practice provisions, and the remuneration of the director was adopted in

compliance with this policy and these provisions. The contract entered into with the director includes

a provision regarding his compensation in the event of dismissal; this compensation will be fixed

based on all relevant circumstances at that time, and will be at least equal to twice his annual salary.

Under the contract, the notice period must be at least six months. The Supervisory Board intends

to continue to report on this remuneration in future annual reports. For details on the director’s

remuneration we refer to the annual reports, in which the section ‘Remuneration of Management

Board members and Supervisory Board members’ [note 23] in the notes to the consolidated financial

statements specifies directors’ fixed and variable remuneration for the most recent financial year,

including any contributions to a pension scheme. In addition, the Supervisory Board also reports on

the director’s remuneration in the annual statement included in the annual report, which is also posted

on the company’s website.


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II.3.1 to II.3.4: Conflicts of interest

Royal Reesink has long since complied with all provisions of the Code relating to the director’s

noncompete clause and the ban on accepting or claiming gifts by the director or his immediate family;

the failure to provide unjustified benefits to the company; the failure to take advantage of business

opportunities for the company by a director or his immediate family;, the reporting of conflicts

of interests and potential conflicts of interest to the Supervisory Board; and the refraining from

participation in the deliberations and decision-making process by a director in the event of a conflict

of interest.

III. SUPERVISORY BOARD

III.1.1 to III.1.9: Duty and procedures

The Supervisory Board has a series of regulations that are available for inspection by shareholders

and holders of depositary receipts at the company’s offices as well as on the company’s website.

The statement of the Supervisory Board, which must be included in Royal Reesink’s annual report

and financial statements, contains the specific information regarding the Supervisory Board members

required under the Code. The other relevant provisions of the Code are complied with as well. At least

once per year, the members of the Supervisory Board discuss the director’s individual performance

and that of each member of the Supervisory Board in the director’s absence.

III.2.1 to III.2.3: Independence

Three of the four members of the Royal Reesink Supervisory Board do not comply with all the criteria

for independence under the Code. In strictly official terms, this is not in accordance with the best

practice provisions.

III.3.1 to III.3.6: Expertise and composition

The current profiles have been updated where necessary and posted on the company’s website, along

with the regulations for the Supervisory Board. Newly appointed members of the Supervisory Board

will enrol in an induction programme. Royal Reesink’s articles of association provide that a member

of the Supervisory Board must retire no later than the date on which the annual general meeting of

shareholders is held in the financial year in which he held that position for twelve years, unless the

general meeting of shareholders resolves otherwise. The other relevant provisions of the Code are

complied with as well. For example, the section of the website entitled ‘Supervisory Board’ (heading:

‘Corporate Governance’) lists the moment of retirement for each member of the Supervisory Board.

III.4.1 to III.4.4: The roles of the Chairman of the Supervisory Board and the company secretary

These provisions of the Code are complied with as well. Royal Reesink has appointed a secretary.

III.5.1 to III.5.14: Composition and role of the three core committees of the Supervisory Board

The Supervisory Board consists of four members. If the Supervisory Board were to be expanded in

the future, the committees specified herein (i.e. an audit, remuneration, and selection and appointment

committee) will be established. The provisions of the Code relevant here will then be complied with. If

this is not the case, the best practice provisions will apply to the entire Supervisory Board.



III.6.1 to III.6.7: Conflicts of interest

The company has long complied with the best practice provisions contained in the Code, as specified

in 6.1, 6.2 and 6.3. If appropriate, the provision specified in 6.4 regarding transactions between the

company and natural persons or legal entities that hold at least 10 percent of Royal Reesink shares,

will likewise be complied with. The regulations of the Supervisory Board have been updated with rules

on handling conflicts of interest or potential conflicts of interest among directors, members of the

Supervisory Board, and the external auditor. Royal Reesink shares the Committee’s opinion regarding

the duty and authority of a delegated Supervisory Board member.

III.7.1 to III.7.4: Remuneration

The general meeting of shareholders sets the remuneration of the Supervisory Board (see also Article

11, paragraph 3 of the Royal Reesink articles of association). For the compensation of the Supervisory

Board, as above, remuneration in shares and/or rights on shares does not apply. The code provisions

specified are included in the regulations for the Supervisory Board published on the company’s

website.

IV. SHAREHOLDERS/GENERAL MEETING OF SHAREHOLDERS

IV.1.1 to IV.1.8: Authorities

The provision included in best practice provision IV.1.1 applies to non-dual board companies, and

therefore not to Royal Reesink. If a serious private offer is made on any of the company’s business

units, the Management Board will publicly disclose this, including reasons. The reservation and dividend

policies, along with the proposal to pay dividend and discharge the members of the Management

Board and Supervisory Board of their liability, are treated as separate agenda items and are accounted

for in the general meeting of shareholders. The determination of a registration date for the exercise

of voting and meeting rights is complied with and is included in the articles of association where

necessary.

IV.2.1 to IV.2.8: Depositary receipts for shares (plus statements regarding protective measures)

Royal Reesink is a company with a relatively low market value. In order to protect our relatively small

company and its shareholders against hostile takeovers, it will continue to be necessary to implement

protective measures. Depositary receipts for shares may serve as such a protective measure. In its

explanation under 58, the Committee also states that these protective measures may be useful if they

are implemented in the interest of the company.

Royal Reesink maintains both Stichting Administratiekantoor van Aandelen Royal Reesink (the ‘trust

office’) and Stichting Continuïteit Royal Reesink. As has been well documented over the years, the

latter foundation has been granted the right to acquire all cumulative preference shares B included in

the company’s issued capital, where it has been agreed that the number of votes cast on cumulative

preference shares B will not exceed the total number of shares outstanding at that time.

Other than in the specific situations described below, the voting right accrues to the holders of

depositary receipts. At their request, the trust office must grant holders of depositary receipts a proxy

to vote on the shares for which they hold the depositary receipts. This proxy is unrestricted and not

bound by any limitation on convertibility.


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However, the trust office is not required to grant the proxy requested, and may restrict or revoke a

proxy granted if (in accordance with Article 118a, Book 2 of the Dutch Civil Code):

a) a hostile public offer has been announced or made or such an offer is expected to be made;

b) one or more individuals hold at least 25% of the depositary receipts and/or shares;

c) if the trust office believes that the exercise of voting rights by a holder of depositary receipts

fundamentally conflicts with the interest of the company and its affiliate.

If the trust offices takes advantage of one of these options, it will notify the holders of depositary

receipts and shareholders accordingly, stating the reasons for its decision.

In its report for 2006, the board of the trust office reports on the desirability of compliance with

the notification requirement in the event that the threshold values for the company’s assets are

exceeded, which also applies to companies listed on the Euronext exchange. The Management Board

believes that compliance with this rule promotes transparency and is of significant value, not least for

investors holding smaller stakes in the company. Failure to comply with the notification requirement

referred to above will prompt the trust office to decide not to grant a proxy or restrict or revoke a

proxy previously granted. If a holder of depositary receipts who fails to comply with the notification

requirement or fails to do so in time is restricted in the option to cast his or her own vote using a

proxy, a shareholder must likewise be subject to the requirement to provide information regarding his

or her own shareholdings in order to be able to cast a vote.

Under another protective measure implemented by Royal Reesink, natural persons or legal entities

may not hold, or be allocated, more than one percent (1%) of the issued ordinary shares in his or

her name. If this does occur, the shareholder in question is required to dispose of its excess shares,

either by selling them or by exchanging them for depositary receipts (see Article 6, paragraphs 1 and

2 of the Royal Reesink articles of association). Due to the new legislation, based on which holders of

depositary receipts can be granted an unrestricted proxy at their request (subject to the exceptions

specified above) to vote on all shares for which they hold the depositary receipts, there is no reason

not to enforce this ‘1% rule’.

Another departure from the Code is that the board of the trust office is in favour of a policy where

board members with a background of the kind mentioned in the final sentence of best practice

provision IV.2.2. are not automatically excluded. This provision relates primarily to directors and

former directors, Supervisory Board members and former Supervisory Board members, employees, or

retained consultants to the company. If the expertise of the person concerned meets the criteria and

provided that holders of depositary receipts do not object, no more than one such person should be

eligible for admission to the board.

As demonstrated by best practice provision IV.2.5 of the Code, the Committee believes that the trust

office focuses primarily on the interests of the holders of depositary receipts and takes into account

the interests of the company and its affiliate(s). However, the management of the trust office believes

it is more advisable to maintain the current objects clause of the articles of association. This objects

clause provides that the voting rights on the shares must be exercised such that ‘the interests of the

company and the companies maintained by the company and its affiliates are being represented in

order to ensure that the independence and/or individual identities of the company and the above-

mentioned companies are continued to maximum capacity, provided that this does not conflict with

the interests of any other parties involved.’



IV.3.1 to IV.3.13: Disclosure/logistics of the general meeting of shareholders

The best practice provisions referred to here are in accordance with Royal Reesink’s policy of

informing all shareholders and other parties in the financial market equally and simultaneously

of any events that could potentially affect the share price. Analyst meetings and presentations to

analysts or private and institutional investors are announced in the ‘Investor Relations’ section on the

company’s website. Royal Reesink will continue to provide the general meeting of shareholders with

all relevant information that it requires for the performance of its authorisations. In accordance with

the provisions of the Code referred to here, Royal Reesink will post presentations for analysts on the

website following the meeting. If necessary, the company will request that the trade in depositary

receipts be suspended during these types of presentations; this also applies to the information Royal

Reesink is required to publish or file in accordance with company law and securities law.

The agenda of the general meeting of shareholders specifies which items will be discussed and which

items will be put to the vote. Additional details are provided in writing if necessary. Upon request, the

company will subsequently make the minutes of the general meetings of shareholders available to

shareholders no later than three months following the meeting in question, after which shareholders

will have the opportunity, for a period of three months, to respond to the minutes. The minutes will

subsequently be confirmed by the chairman of the meeting and the secretary in accordance with

Article 19, paragraph 2 of the Royal Reesink articles of association. The Management Board will

provide an overview in the annual report of all outstanding or potentially implementable protective

measures to prevent any changes of control.

V. AUDIT OF THE FINANCIAL REPORTS AND POSITION OF THE INTERNAL AUDIT FUNCTION AND THE

EXTERNAL AUDITOR

V.1.1 to V.1.3: Financial reporting

The practices in place at Royal Reesink comply with these provisions of the Code..

V.2.1 to V.2.3: Role, appointment, remuneration and assessment of the performance of the external

auditor

The company complies with these provisions of the Code. The external auditor attends the general

meeting of shareholders in order to be questioned about the accuracy of the financial statements. The

Royal Reesink Management Board reports to the Supervisory Board on changes in the relationship

with the external auditor and in accordance with the Royal Reesink articles of association (Article 16,

paragraph 1c), the external auditor is appointed by the general meeting of shareholders, unless the

general meeting delegates this appointment.

V.3.1 to V.3.3: Internal audit function

Royal Reesink does not employ an internal auditor.

V. 4.1 to V. 4.3: Relationship and communications between the external auditor and company bodies

The external auditor attends the meeting of the Supervisory Board in which the external auditor’s

report and the financial statements are discussed.


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The external auditor subsequently receives all the financial information it requires in order to perform

its duties. Each year, the external auditor submits an audit report to the Management Board and

Supervisory Board, which is then discussed in the joint meeting of the two boards.

Apeldoorn, the Netherlands, 7 April 2014

The Management Board:

G. van der Scheer


Zutphen, 1 p.m. Royal Reesink is there for you – anywhere, anytime

09:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00



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S5 | REPORT OF THE SUPERVISORY BOARD

Financial statements, dividend and discharge

The annual report, prepared by the Management Board and including the 2013 financial statements,

has been audited by Deloitte Accounts B.V. The auditor’s unqualified audit opinion relating to the

financial statements is included on page 137 of this report. We discussed the annual report with

the Management Board in the auditor’s presence. Based on this meeting, we are convinced that the

annual report forms a solid basis for the Supervisory Board’s accountability for its supervisory duties.

We propose that the general meeting of shareholders:

●● adopt the financial statements;

●● approve the dividend proposal of € 2.50 per ordinary share/depositary receipt for an ordinary

share;

●● discharge the Management Board from liability for their management in 2013;

●● discharge the Supervisory Board for their supervision in 2013.

In just one year, Royal Reesink has made great strides in its strategy, launched

in 2013, of becoming a major full-line equipment distributor. The merger of

Hans van Driel (acquired in early 2013) and the Kemp Group into Reesink

Construction Equipment has created an even stronger player in the Benelux

market. The acquisition of Pon’s material handling business – integrated into

Reesink Material Handling Equipment (RMHE) – has given Royal Reesink a

strong market position in the Benelux region and Germany’s North Rhine-

Westphalia. This has resulted in an even greater spread of activities and an

expansion of the company’s geographic presence, as well as further reducing

its risk profile.

In addition, the company once again managed to increase shareholders’

equity through a series of rights issues. Royal Reesink launched the first-

ever public rights issue in its history, which was completed successfully and

attracted investors who had not previously been familiar with the company.

This has enabled the company to put itself firmly on the radar – both among

investors and among other market players. These significant steps have

brought Royal Reesink’s pro forma annual revenue for 2013 to € 402.4

million. This size has also made Royal Reesink more interesting to employees,

prospective employees, suppliers and customers.

We would like to take this opportunity to thank the Management Board and

all employees for their continued hard work in the past year.

S5

Report of the Supervisory Board

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Supervision

We met with the Management Board on ten occasions during the year under review, plus once in the

absence of the Management Board. Nine of these meetings were attended with the full Supervisory

Board, while on one occasion a member of the Board attended a meeting of the Central Works Council.

In addition, we also consulted with each other by telephone on several occasions.

The agenda for these meetings included the company strategy as presented by the Management Board

and operational and financial targets and objectives, along with financial reports, budgets and current

business in both segments, in addition to economic trends and their impact on the organisation.

We discussed the acquisition of the material handling business of Pon Holdings B.V., including the

hydraulic components and systems, in detail. In addition, we also carefully analysed the quick wins and

medium-term synergy effects. The financing of the acquisition – as detailed elsewhere in this report –

was also the subject of heated debate. We eventually decided unanimously that this significant step

dovetails with the strategy defined. Reesink Equipment currently has three strong divisions with

sufficient overlap to achieve synergy effects as well having as sufficient growth potential. We are also

very satisfied with the acquisition of CT Agro GmbH, which was completed early this year.

We see opportunities in the Kazakh market for the group as a whole – including both the Reesink

Equipment companies and Motrac Hydraulics, which forms part of Reesink Industries.

Unfortunately, the steel business continues to be affected by the weak economy. However, Reesink

Staal has been restructured such that the company will be able to benefit immediately from any

economic recovery.

The external auditor has assessed the correct operation of the internal risk management and monitoring

system (if relevant to the audit of the financial statements). The report for 2013 contains findings that,

while not indicating any major shortcomings, did include recommendations for improvement. The

Board has therefore assessed the system to be adequate. The Board receives the main key performance

indicators on a monthly basis, including detailed notes from the Management Board.

Composition of the Supervisory Board

In the meeting not attended by the Management Board, we discussed the composition and performance

of our Board and that of the individual members of the Supervisory Board, including the profiles. In

view of the company’s increased size and the expanded activities, we set extra-stringent requirements

which members of the Royal Reesink Supervisory Board must satisfy.

We validated these requirements against the experience, knowledge and expertise of the members of

the Supervisory Board, including an analysis of the strength of individual members. After this thorough

evaluation, we concluded that the current Supervisory Board is competent to fulfil its supervisory

duties and able to provide critical input and advice to the company. One of the members holds a 5%

stake in Koninklijke Reesink N.V. through an affiliated legal entity.

Pursuant to an amendment of Book 2 of the Dutch Civil Code, large companies such as Royal Reesink

are required to provide an explanation if the seats on the Management Board or Supervisory Board

are not evenly distributed among men and women, as specified in Section 166, Book 2 of the Dutch

Civil Code. A balanced distribution of the seats of the Management Board and Supervisory Board is

defined as a minimum of 30% of these seats being held by women and a minimum of 30% by men, if

the seats are distributed among individuals rather than legal entities.


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The composition of the Supervisory Board is currently 100 percent male. In selecting candidates for

the position of Supervisory Board members, we aim for an adequate combination of knowledge of,

and experience with, the company’s activities. We make no distinction in this selection process based

on gender, and do not intend to change this policy in the future. We will, however, strive to more

actively recruit female candidates. In our final selection we will adopt a gender-neutral approach, with

the candidate’s knowledge and experience being the decisive factor at all times.

Due to the relatively small size of our Board, we do not think it advisable to establish separate

committees with special mandates. Instead, any and all issues are discussed by all members of the

Board.

Remuneration

The compensation of the CEO is shown in ‘Remuneration of directors and Supervisory Board members’

(Note on page 123). In response to comments made in the general meeting of shareholders, the Board

decided to include the fixed portion of the bonus in the basic salary.

The CEO is entitled to an annual bonus, to be determined at the discretion of the Supervisory Board,

which will be based on factors such as the achievement of the annual budget targets as approved

by the Supervisory Board, and the CEO’s individual performance. The bonus comprises a maximum

of 30% of the current basic salary on an annual basis. The Supervisory Board is entitled to use its

discretionary powers to depart from the 30% in the event of exceptional performance.

Corporate governance

The Management Board’s opinions regarding the Corporate Governance Code are included on page 77

of this report. If there are any changes, this item will be placed on the agenda of the general meeting

of shareholders. The Supervisory Board and the Management Board have not changed their opinions

regarding the Code in the past year.


Supervisory Board:

C.P. Veerman

F.L.H. van Delft

L. Lievens

B. Vos

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Vaals, 2 p.m. Royal Reesink is there for you – anywhere, anytime

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Financial statements

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CONSOLIDATED BALANCE SHEET (before profit appropriation)

(in thousands of euros) Notes 31 December 2013 31 December 2012

Fixed assets

Intangible fixed assets 1 5,460 -

Tangible fixed assets 2 66,109 41,475

Investment property 3 22,950 24,570

Financial fixed assets 4 3,798 1,692

98,317 67,737

Current assets

Inventories 5 90,318 63,397

Receivables 6 56,948 27,331

Cash and cash equivalents 7 6,479 4,631

153,745 95,359

Total assets 252,062 163,096

Group equity 8

Shareholders’ equity 28 85,109 74,105

Minority interest 8 -26 -50

85,083 *) 74 055 *)

Subordinated convertible loans 9 10,300 *) - *)

Provisions 10 15,148 11,786

Non-current liabilities 11 30,907 14,544

Current liabilities 12 110,624 62,711

Total equity and liabilities 252,062 163,096

*) Capital base

The group capital and the subordinated loans together comprise the capital base, which totalled € 95,383 at the end of December 2013

(2012: € 74,055).



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CONSOLIDATED PROFIT AND LOSS ACCOUNT

(in thousands of euros) Notes 2013 2012

Net revenue 13 236,558 185,222

Cost of sales 14, 15 -203,042 -162,595

Gross operating income 33,516 22,627

Selling expenses 14, 15 13,424 9,292

Administrative expenses 14, 15 12,923 8,717

Exceptional items 16 - 229

Total expenses 26,347 18,238

Net operating income 7,169 4,389

Other operating income 17 3,252 2,315

Operating income 10,421 6,704

Revenues from receivables included in fixed assets, and from securities

- 182

Income from financing activities and similar income

130 343

Changes in the value of receivables included in fixed assets, and of securities

- -3,215

Expenses relating to financing activities and similar charges

-2,235 -905

Non-realised fair value adjustments of investment property

-1,804 -2,878

-3,909 -6,473

Result from ordinary activities before taxation 6,512 231

Taxation of result from ordinary activities 18 -1,998 -626

Share in result from participating interests 19 19 -3,922

1,979 -4,548

Result after taxation 4,533 -4,317

Minority interest in profit -24 -14

Net result 4,509 -4,331

To be allocated to shareholders:

- Net result per ordinary share (in €) 20 4.85 -6.22

- Diluted net result per ordinary share (in €) 4.79 -6.12



CONSOLIDATED CASH-FLOW STATEMENT


Operating result 10,421 6,704

Adjustments for:

- Depreciation and amortisation 4,481 2,276

- Changes in provisions -338 -805

- Changes in working capital

Changes in inventories 2,644 980

Changes in receivables 2,412 5,046

Changes in current liabilities -3,659 -4,369

1,397 1,657

Cash flow from business operations 15,961 9,832

- Income received from financing activities 130 155

- Dividend received - 182

- Expenses relating to financing activities -2,084 -978

- Income tax paid -1,407 -637

-3,361 -1,278

Cash flow from operating activities 12,600 8,554

Acquisition/disposal of group companies 25 -37,844 -14,864

Investments in:

- Intangible fixed assets -367 -

- Tangible fixed assets -6,915 -2,820

- Financial fixed assets -1,307 -920

Disposals:

- Tangible fixed assets 1,009 146

- Financial fixed assets 151 405

Cash flow from financing activities -45,273 -18,053

Changes in debts to credit institutions -8,650 -1,566

Income from non-current liabilities 23,716 14,936

Repayment of non-current liabilities -755 -308

Revenues from the issue of shares/depositary receipts 20,210 4,936

Dividend paid - -4,243

Cash flow from financing activities 34,521 13,755

Changes in cash and cash equivalents 1,848 4,256


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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(in thousands of euros) 2013 2012

Consolidated net result after taxation attributable to the legal entity

4,509 -4,331

Goodwill paid on acquisitions -23,446 -2,868

Fair value adjustment of tangible fixed assets -486 -763

Changes in reserve of price differences -210 -185

Corporation tax recognised in shareholders’ equity 811 -

Other -40 -118

Total direct changes in the company’s shareholders’ equity as a portion of group equity

-23,371 -3,934

Legal entity’s comprehensive income -18,862 -8,265



Notes to the consolidated financial statements

GENERAL DETAILS

General information on Koninklijke Reesink N.V.

Having been in operation since 1786, Koninklijke Reesink N.V. (Royal Reesink) is one of the oldest

trading companies in the Netherlands. Depositary receipts for ordinary shares in Royal Reesink have

been traded at Amsterdam’s NYSE Alternext stock exchange since 2006, while the company has been

listed since 1959. Royal Reesink has its registered office in Apeldoorn, the Netherlands, where it is

headquartered as well. Royal Reesink’s consolidated financial statements for the year ending

31 December 2013 include the financial statements of Royal Reesink and its subsidiaries and the

company’s stake in other participations (non-consolidated). The financial statements were prepared by

the Management Board and were approved by the Supervisory Board on 7 April 2014. They will be

submitted for adoption to the general meeting of shareholders to be held on 27 May 2014.

Group relations

Royal Reesink is at the head of a group of legal entities – the table below provides details on the

company structure, as required under Sections 379 and 414 of Book 2 of the Dutch Civil Code. Royal

Reesink maintains the following (indirect) capital interests:

Name Location

Share in issued capital %

Liability disclosure under Section 403 of Book 2 of the Dutch Civil Code

Consolidated participations

Reesink Equipment B.V. (formerly Recobel B.V.) Apeldoorn (Netherlands) 100 Yes

Kamps de Wild Holding B.V. Apeldoorn (Netherlands) 100 Yes

Kamps de Wild B.V. Zevenaar (Netherlands) 100 Yes

CT Agro GmbH (formerly Reesink Agricultural Equipment GmbH)

Herzfeld-Lippetal (Germany) 100 -

Kamps de Wild Participaties B.V. Zevenaar (Netherlands) 100 No

Landtech Zuid B.V. Veghel (Netherlands) 100 No

Bruggeman Mechanisatie B.V. Broekland (Netherlands) 75 -

Reesink Green Equipment B.V. (formerly Dutec Beheer B.V.)

Apeldoorn (Netherlands) 100 Yes

Reesink Technische Handel B.V. Apeldoorn (Netherlands) 100 Yes

Stierman B.V. Apeldoorn (Netherlands) 100 Yes

Packo Agri N.V. Zedelgem (Belgium) 100 -

Packo & Heybroek N.V. Zedelgem (Belgium) 100 -

Jean Heybroek B.V. Houten (Netherlands) 100 Yes

Reesink Construction Equipment B.V. Apeldoorn (Netherlands) 100 Yes

Ben Kemp Holding B.V. De Meern 100 Yes

Barend Kemp B.V. De Meern (Netherlands) 100 Yes

Huur&Stuur B.V. De Meern (Netherlands) 100 Yes

Kemp BVBA Hamme (Belgium) 100 -


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Name Location

Share in issued capital %

Liability disclosure under Section 403 of Book 2 of the Dutch Civil Code

Vacu-Rent B.V. De Meern (Netherlands) 100 Yes

Kemp Hoogwerkers B.V. De Meern (Netherlands) 100 Yes

Hans van Driel B.V. Tiel (Netherlands) 100 Yes

Reesink Material Handling Equipment B.V. (formerly Pon Material Handling Europe B.V.)

Almere (Netherlands) 100 Yes

Motrac Intern Transport B.V. Almere (Netherlands) 100 Yes

Pelzer Fördertechnik GmbH Kerpen-Sindorf (Germany) 75.04 -

Motrac Handling & Cleaning N.V. Antwerp (Belgium) 100 -

Q-Lion B.V. Almere (Netherlands) 100 Yes

Reesink Industries B.V. Apeldoorn (Netherlands) 100 Yes

Reesink Staal B.V. Zutphen (Netherlands) 100 Yes

Motrac Hydrauliek B.V. Baak (Netherlands) 100 Yes

Motrac Hydraulik GmbH Langenfeld (Germany) 100 -

Safety Centre International B.V. Rosmalen (Netherlands) 100 Yes

Nederlandse Staal Unie B.V. Stampersgat (Netherlands) 100

Reesink Support B.V. Apeldoorn (Netherlands) 100 Yes

Reesink Duitsland B.V. Apeldoorn (Netherlands) 100 No

Reesink Germany GmbH Herzfeld-Lippetal (Germany) 100 -

Reesink GmbH Herzfeld-Lippetal (Germany) 100 -

Bureau voor Dienstverlening The Pentagon B.V. Apeldoorn (Netherlands) 100 Yes

Other participations

THR B.V. Apeldoorn (Netherlands) 36 -

De Kruyf Holding B.V. Nijkerk (Netherlands) 25 -

Mechanisatie Beheer B.V. Beilen (Netherlands) 25 -

Fixet Valkenswaard B.V. (name changed in 2014 to Outlet-DHZ-Valkenswaard B.V.)

Valkenswaard (Netherlands) 100 No

Acquisitions and disposals of participations

The results of newly acquired group companies are consolidated from the acquisition date: on that

date the assets, provisions and debts are valued at fair value. The goodwill paid is deducted from

shareholders’ equity.

On 28 January 2013, Royal Reesink received the shares from Hans van Driel, which has its registered

office in Tiel, the Netherlands. The equity facility arranged with Project Holland Deelnemingen B.V.

was used for the financing. A total of 59,300 ordinary shares were issued in a private placement

(total facility: 70,523). These shares are certified at € 74 per depositary receipt for one ordinary share

and have been transferred to Project Holland Deelnemingen B.V. The purchase price was € 1.6 million

Goodwill paid on the acquisition was € 0.3 million.



Royal Reesink acquired Pon Material Handling Europe (PMH-E) on 16 October 2013. Besides PMH-E

(following the acquisition: Reesink Material Handling Equipment, RMHE) the companies involved in

this acquisition include Motrac Intern Transport, Motrac Hydrauliek, Motrac Handling & Cleaning,

Motrac Hydraulik and Pelzer Fördertechnik. The purchase price was paid by means of a private

placement of depositary receipts for ordinary shares with qualified investors. Additionally, a private

placement took place in November 2013 of 46,986 depositary receipts for ordinary shares. Finally,

the selling party acquired depositary receipts for ordinary shares in Royal Reesink and provided a

convertible subordinated loan. The total purchase price including earn-out fee, interest and acquisition

costs was € 74.0 million. The residual goodwill paid upon acquisition was € 22.9 million and was

deducted from shareholders’ equity.

Landtech Zuid, a new subsidiary of Kamps de Wild Participaties, acquired part of the business of Jans-

VanGemeren Mechanisatie B.V. in Veghel, the Netherlands on 18 October 2013. Landtech Zuid started

out as a dealer company for brands including Claas, Amazone and Kaweco for the Central Brabant

region. The total value of the assets and liabilities acquired was nil. The goodwill on the acquisition

was € 0.3 million. The acquisition was funded with the issue of the 11,223 depositary receipts for

ordinary shares remaining under the equity facility at a price of € 74.

Consolidation principles

The consolidated financial statements include the financial data of Royal Reesink and its group

companies, along with other legal entities over which the company can exercise material control or

which is subject to central management. Group companies are participations in which the company

has a majority stake or over which it can otherwise exercise policy-making control. Determining

whether the company is able to exercise such control involves the use of financial instruments

containing potential voting rights which can be exercised directly. Participations held for sale, along

with participations whose significance is negligible, are not consolidated. The consolidated financial

statements are prepared in compliance with the accounting principles of Royal Reesink.

Newly acquired participations are included in the consolidation as from the date policy-making control

can be exercised. On this date, the assets, provisions and liabilities are valued at fair value. Divested

participations are included in the consolidation until the time this control is terminated.

In the consolidated financial statements any liabilities, receivables and transactions between the

group companies have been eliminated, along with the unrealised profits earned by Royal Reesink. The

group companies have been consolidated as a whole, with third-party minority interests stated

separately.

Application of Section 402 of Book 2 of the Dutch Civil Code

The financial data of Royal Reesink are included in the consolidated financial statements. In accordance

with Section 402 of Book 2 of the Dutch Civil Code, the Royal Reesink company profit and loss account

therefore only states the after-tax profit from participations and the remaining after-tax profit.


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GENERAL PRINCIPLES FOR PREPARING THE CONSOLIDATED FINANCIAL STATEMENTS

The listing of the depositary receipts for ordinary shares in Royal Reesink on the NYSE Alternext stock

exchange in Amsterdam allows the financial statements to be prepared in accordance with the

provisions of Part 9 of Book 2 of the Dutch Civil Code and the applicable Accounting Principles for

Annual Reporting, subject to the fact that Royal Reesink opts to make use of the facilities provided

under Section 384, Book 2 of the Dutch Civil Code to value the land and buildings and investment

property listed under tangible fixed assets at fair value.

ACCOUNTING PRINCIPLES

General details

Unless otherwise specified, assets and liabilities are recognised at nominal value.

Assets are included in the balance sheet if it is probable that future profits will accrue to the company

and the value of the assets can be reliably ascertained. Liabilities are included in the balance sheet if

it is probable that the settlement will be combined with an outflow of assets with intrinsic profits and

if the amount of the assets can be reliably ascertained.

Income is recognised in the profit and loss account if an increase in the economic potential, relating to

an increase in an asset or a decrease in a liability, has occurred of which the amount can be reliably

ascertained. Expenses are recognised if a decrease in economic potential, related to a decrease in an

asset or an increase in a liability, has occurred of which the amount can be reliably ascertained. If, as

a result of a transaction, virtually all or all future profits and all or virtually all risks relating to an asset

or liability have been transferred to a third party, the asset or liability is no longer included in the

balance sheet. Assets and liabilities are also no longer recognised in the balance sheet from such time

as the conditions of probability of future profit and the reliability of the determination of the value

are no longer satisfied.

The income and costs are allocated to the period to which they relate. Revenues from goods are

recognised if all key risks relating to the goods have been transferred to the buyer. Revenues from

services are recognised based on actual services provided.

The financial statements are presented in euros, the company’s functional currency. All financial data

stated in euros are rounded to the nearest thousandth, unless stated otherwise.

The preparation of the financial statements requires that the management form opinions and make

assumptions that affect the application of principles and the reported value of assets and liabilities,

and of income and expenses. The actual outcome may vary from these estimates. The estimates and

underlying assumptions are evaluated on a continuous basis. Revised estimates are recognised for the

period for which the estimate is being revised and during future periods affected by the revision.

Principles for the conversion of foreign currencies

Transactions stated in foreign currencies are converted to the company’s functional currency at the

exchange rate applicable on the transaction date. Monetary assets and liabilities stated in foreign

currencies are converted at the balance sheet date to the functional currency at the exchange rate



applicable on that date. Non-monetary assets and liabilities in foreign currencies recognised at

historical cost are converted to euros at the exchange rates applicable on the transaction date. The

exchange-rate differences resulting from the conversion are recognised in the profit and loss account.

Financial instruments

Financial instruments include investments in equity, trade receivables and other receivables, cash,

(convertible) loans, other finance liabilities, accounts payable and other payable items. The notes to

the separate balance sheet items explain the fair value of the instrument in question if this differs

from the book value. For the principles of the financial instruments, please refer to the notes per

balance sheet item.

Intangible fixed assets

The intangible fixed assets acquired by the group include service contracts and software. The fair

value of service contracts, acquired upon the RMHE acquisition in 2013, is determined based on the

‘multi-period excess earnings’ method, which involves recognising the underlying asset after deducting

a reasonable return from the other assets contributing to the associated cash flow.

The software is recognised at the amount of the expenses incurred, less the cumulative amortisation,

and – if applicable – less impairment adjustments. The annual amortisation comprises a fixed

percentage (20%) of the expenses incurred. The economic lifecycle and the amortisation method are

reassessed at the end of each financial year.

Tangible fixed assets

Land and buildings

Land and buildings are valued in accordance with the Fair Value Resolution (Besluit Actuele Waarde)

at replacement cost or a lower enterprise value or (in the event of a decision to sell) realisable value.

Replacement cost is based on annual appraisals by independent appraisers and is defined as the cost

of replacing an operational asset with another asset of equal economic value to the company’s

operations. Depreciation is determined taking into account a residual value. Any changes in the

valuation are accounted for directly in shareholders’ equity, taking into account deferred taxation,

until the revaluation reserve has been fully utilised for the asset concerned.

Costs related to periodic extensive maintenance are taken to profit/loss at the time when these costs

are incurred.

Plant, equipment and vehicles

Plant, equipment and vehicles are valued at the acquisition price, less cumulative depreciation and, if

applicable, less impairment adjustments. The depreciation is based on estimated economic life and is

calculated based on a fixed percentage of the acquisition price, taking into account any residual value.

Depreciation commences upon use of the asset.

Plant and equipment includes office and warehouse equipment, machines and equipment, and non-

motorised vehicles. Vehicles include trucks, cars and motorised vehicles used for internal transport


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The following depreciation rates apply:

●● Office and warehouse equipment: 20-33

●● Machines and equipment: 7-20

●● Non-motorised vehicles: 20

●● Vehicles: 20-33

Maintenance expenses are capitalised only if they extend the useful life of the object..

Rental equipment

Rental equipment is valued at the acquisition price, less cumulative depreciation and, if applicable,

with the application of impairment adjustment. Depreciation is based on estimated economic life, and

is mainly calculated based on a fixed percentage (16.6% – 20%) of the acquisition price, and taking

into account a residual value if necessary. Depreciation commences as soon as the equipment is taken into

service.

Investment property

Land and buildings not used for business operations but held for the purpose of generating rental

income and/or value increases qualify as investment property. Properties are valued at market value,

in accordance with the Fair Value Resolution (Besluit Actuele Waarde). The market value is the amount

for which an asset may be traded between parties that possess sufficient relevant information

regarding the transaction, which are willing to enter into a transaction and are independent from one

another. The market value of each investment property has been determined through annual appraisals

by independent appraisers. Any adjustments to appraisals are taken directly to the profit and loss

account (‘Non-realised fair value adjustments of investment property’).

Financial fixed assets

Participations where material control can be exercised over the company’s business and financial

policies are valued in accordance with the equity accounting method based on net asset value. In

determining net asset value, the company’s accounting principles are used. Participations with a

negative net asset value are valued at nil. If the company guarantees the debts of the participation in

question, a provision is created. This provision is established primarily at the expense of receivables

from this participation, and for the remainder under the provisions in the amount of the share of

the losses incurred by the participation, or for the payments the company is expected to make for the

benefit of this participation.

Participations over which no material control can be exercised are valued at the acquisition price or

at the long-term lower value in use. Dividends are accounted for in the period in which they are made

payable.

Loans to non-consolidated participations and other receivables are initially recognised at fair value

and subsequently at amortised cost based on the effective-interest method, less impairment losses.

Financial fixed assets include deferred tax assets, if and to the extent that it is likely that the tax claim

will be exercised in due course. These are valued at fair value and are generally of a long-term nature.

Kon ink l i j ke Rees ink N .V. Annua l Repor t 20131 0 0


Securities listed on the stock exchange are valued at fair value, i.e. the market value as at the balance

sheet date, where both unrealised and realised changes in value are taken directly to the profit and

loss account.

Inventories

Goods for sale are valued at the acquisition price (fifo) or the lower market value, with the exception

of the rolled steel products, the value of which is highly sensitive to fluctuations in the prices of basic

materials. These latter products are valued at replacement cost. Changes in replacement cost are

added to or deducted from the reserve for price differences on inventories, taking into account the

necessary addition to or withdrawal from the provision for deferred tax liabilities.

A provision for non-marketability is deducted from the inventory value, which is related to the level

and composition of the inventories.

Receivables

Receivables are initially recognised at fair value and subsequently valued at amortised cost, which

may be equal to the nominal value, less provisions deemed necessary in order to reduce bad-debt risk.

These provisions are determined based on an individual assessment of the receivables. Changes in fair

value are accounted for in the profit and loss account.

Cash and cash equivalents

Cash and cash equivalents are valued at cost.

Revaluation reserve

Value increases in assets that are valued at fair value are included in the revaluation reserve.

The revaluation reserve is created per individual asset and does not exceed the difference between

book value based on historical cost and book value based on fair value. If an asset is sold, any

revaluation reserve in place relating to that asset is then released and added to the remaining reserves.

In determining the revaluation reserve an amount is deducted for deferred tax liabilities, calculated at

the current tax rate.

Reserve for own shares

On acquisition of the share capital, the amount of the compensation paid, including the directly

attributable costs, are recognised as a change in shareholders’ equity. Shares purchased are classified

under the reserve for own shares and presented as a reduction in the total capital.

Minority interests

BThe third-party minority interest is valued on the third-party interest in net asset value and is

determined in accordance with Royal Reesink’s accounting principles. Third-party interest in profit

from the consolidated companies is deducted from the group profit (loss) in the profit and loss account.

Subordinated convertible loan

The fair value of the portion of the subordinated convertible loan classified as a liability

was determined based on the market interest rate for a similar, non-convertible subordinated loan.

The amortised cost is recognised as a liability until the conversion date. The remaining portion of the

Annua l Repor t 2013 Kon ink l i j ke Rees ink N .V. 1 0 1

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revenue is allocated to the conversion option, which is included in shareholders’ equity, with taxes to

be deducted.

Provisions

Provisions are recognised in the balance sheet if there is a legally enforceable or actual liability that

is the result of a past event, and if it is probable that the settlement of this liability requires an outflow

of assets and this amount can be estimated in a reliable manner.

Provision for deferred taxes

A provision is made for deferred taxes for temporary differences between the book value of assets

and liabilities for the purpose of financial reporting and the tax base of these items. The provision is

valued at the nominal value of future tax liabilities.

Pension provision

Some employees are entitled to pension benefits for periods in the past in which fewer pension

entitlements were accrued than permitted. A provision has been included for the non-financed portion.

The provision is recognised at the present value of future expenses, factoring in the likelihood of the

employee remaining in service and the employee’s death.

Provision for commitments

A provision has been created for costs relating to receivables on product guarantee agreements

provided, which is valued at the par value of the future liability.

Provision for jubilee benefits

The liability included for jubilee benefits is the most accurate estimate of the amounts necessary to

settle the relevant liability at the balance sheet date. The provision is valued at the present value of

the future expenses, taking into account the accumulation of rights based on factors such as the

number of years of service and the likelihood of the employee remaining with the company.

Other provisions

Unless otherwise specified, the other provisions are recognised at the nominal value of the issues

which are likely to be necessary in order to settle the liabilities concerned.

Non-current liabilities

Non-current liabilities are initially recognised at fair value less attributable transaction costs. After

initial recognition, interest-bearing loans are valued at amortised cost, where any difference between

cost and the redemption price is recognised as a straight line in the profit and loss account for the term

of the facility, using the effective interest-rate method. Loans are recognised as current liabilities,

unless the group has the intention and an unconditional right to postpone settlement of the liability to

at least twelve months following the balance sheet date.

Employee benefits

Royal Reesink offers a number of pension schemes. The Dutch schemes are financed with payments to

pension providers, i.e. insurance companies and industry pension funds. The foreign pension schemes

are comparable to the structure and operation of the Dutch pension scheme. The pension commitments



from both the Dutch and the foreign schemes are valued in accordance with the ‘obligation to the

pension provider’ approach. Based on this approach, the premium to be paid to the pension provider

is recognised as an expense in the profit and loss account.

Based on the implementation agreement, it is then assessed what commitments (if any) exist at the

balance sheet date besides the payment of the annual premium payable to the pension provider.

The valuation of the liability (provided there is one) is the most accurate estimate of the amounts

necessary to settle this at the balance sheet date.

Revenue recognition

Revenues from the sale of goods and services are included in net revenue at the fair value of the

compensation received or to be received, less revenues and allowances, trade discounts and volume

discounts. Revenues from the sale of goods and services are recognised in the profit and loss account

if the key risks and benefits of ownership have been transferred to the buyer and the collection of the

compensation payable is likely.

Cost of sales

The cost of sales represents the most recently known purchase price or lower market value or the

replacement cost (free warehouse) at the time of sale, along with the costs of storage, processing and

distribution, including the related direct wage costs, adjusted with the discount received by suppliers

for cash payment.

Other operating income

Rental income

Rental income from investment property is recognised in the profit and loss account on a straight-line

basis based on the term of the lease.

Management agreement

Revenues from management agreements are recognised in the profit and loss account on a straight-

line basis based on the term of the management agreement in question.

Share in result from participating interests

The share in the result from participating interests includes the share of Royal Reesink in the profits

of these participating interests, along with any amortisation of these participations. This result is

determined based on the accounting principles applicable at Royal Reesink. Profits from transactions,

in which assets and liabilities are transferred between Royal Reesink and the non-consolidated

participations and among non-consolidated participations, have not been recognised if they can be

regarded as being non-realised.

The profits/losses of participations acquired or divested of during the financial year from the time of

acquisition or the time of disposal, are recognised in Royal Reesink’s profit and loss account.


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Taxes

Taxes include taxes on profit and deferred taxes that are payable and deductible during the reporting

period. Taxes are recognised in the profit and loss account, unless they relate to items that are included

directly in shareholders’ equity, in which case taxes are recognised in shareholders’ equity.

Taxes payable and deductible for the financial year represent the expected taxes to be paid on taxable

profit for the financial year, calculated based on tax rates determined on the reporting date or

regarding which a material decision was made on the reporting date, along with any adjustments

made on taxes payable for previous years.

Net result per ordinary share

Net result per ordinary share is calculated as net result allocated to the holders of ordinary shares

divided by the average number of ordinary shares outstanding for the relevant period. Diluted result

from ordinary shares is calculated as net profit/loss allocated to the holders of ordinary shares divided

by the average number of ordinary shares outstanding for the relevant period, including potential

ordinary shares, if this were to result in dilution.

Cash-flow statement

The cash-flow statement is prepared based on the indirect method. The assets included in the cash-

flow statement consist of cash and cash equivalents. The changes in the ‘securities’ item are included

in the ‘receivables’ change. Income and expenditure in respect of finance income and expenses,

dividends received and tax on profit are included under cash flow from operating activities. Cash flow

from financing activities includes the dividends paid by Royal Reesink and changes in debts to credit

institutions. Transactions that do not involve trading in assets are not included in the cash-flow

statement.

Cash flows in foreign currencies are converted at an estimated average rate.

The acquisition price of the group companies acquired is included under cash flow from investing

activities, provided that payment was made in cash. Cash held by these group companies is deducted

from the acquisition price.



1 INTANGIBLE FIXED ASSETS

The table below shows changes in intangible fixed assets:

Service-contract

Software Total

Balance as at 1 January 2013:

- Purchase price - - -

- Accumulated amortisation and impairments - - -

Book value - - -

Changes during the 2013 financial year:

- Investments - 367 367

- New consolidations 3,998 753 4,751

- Reclassification - 781 781

- Amortisation -119 -320 -439

3,879 1,581 5,460

Balance as at 31 December 2013:

- Purchase value 3,998 8,791 12,789

- Accumulated amortisation and impairments -119 -7,210 -7,329

Book value 3,879 1,581 5,460

The service contracts were acquired along with the RMHE acquisition in 2013 and will be amortised

over a seven-year period (the average contract term for service contracts).


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2 TANGIBLE FIXED ASSETS

The table below shows changes in tangible fixed assets:

Land and buildings

Equipment Rental equipment

Vehicles Total

Balance as at January 2013:

- Purchase price 19,573 12,021 12,873 3,335 47,802

- Accumulated fair value changes 13,711 - - - 13,711

- Accumulated depreciation and impairment

-4,574 -8,081 -5,190 -2,193 -20,038

Book value 28,710 3,940 7,683 1,142 41,475


- Changes in fair value -832 - - - -832

- Investments 778 1,286 4,202 649 6,915

- New consolidations 7,658 1,907 13,541 640 23,746

- Reclassification - -781 634 - -147

- Disposals - - -839 -167 -1,006

- Depreciation - -1,190 -2,400 -452 -4,042

7,604 1,222 15,138 670 24,634


- Purchase price 31,498 25,810 55,199 5,712 118,219

- Accumulated fair value changes 12,879 - - - 12,879


-8,063 -20,648 -32,378 -3,900 -64,989

Book value 36,314 5,162 22,821 1,812 66,109

The € 0.8 million change in fair value (2012: € 1.1 million) is the result of a change in reinstatement

values as well as functional and technical obsolescence.

The new consolidation for land and buildings represents investment property of Pelzer Fördertechnik

in Kerpen (Germany) and Köln (Germany) and Motrac Handling & Cleaning in Antwerpen (Belgium).

Of the € 37.6 million book value of the land and buildings, a total of € 2.8 million relates to assets

which are no longer used for business operations.



As at 31 December 2013, property used for business operations had an acquisition value of

€ 27.3 million. If this property had been valued at the acquisition value, a total of € 8.8 million

(2012: € 4.7 million) would have been depreciated on a cumulative basis.

The sites in this category held in ownership in this category covers a total of 26.0 hectares, of which

8.3 hectares are developed.

The rental equipment recognised in the balance sheet related mainly to Huur&Stuur and the in 2013

acquired companies Motrac Intern Transport and Motrac Handling & Cleaning. Other companies within

the group also lease equipment, albeit to a lesser extent.

3 INVESTMENT PROPERTY


- Purchase price 21,423

- Accumulated fair value changes 3,147

Book value 24,570


- Changes in fair value -1,620

-1,620


- Purchase price 21,423

- Accumulated fair value changes 1,527

Book value 22,950

Changes in fair value relate primarily to the investment property at Ecofactorij in Apeldoorn.

The sites held in ownership as investment properties cover 25.6 hectares, of which 3.1 hectares are

developed.


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4 FINANCIAL FIXED ASSETS

The table below shows changes in financial fixed assets.

Participations Receivables fromParticipations

Other receivables

Deferred tax assets

Other securities

Total

Book value as at 1 January 2013 440 451 143 - 658 1,692


- Investments; loans provided - 1,260 47 - - 1,307

- New consolidation - - - 1,172 - 1,172

- Formation of deferred tax assets - - - 35 - 35

- Disposals; repayment of loans - -29 -122 - - -151

- Share in result from participations 19 - - - - 19

- Impairment - - -50 - - -50

- Realisation of deferred tax assets - - - -416 - -416

- Reclassification - - 190 - - 190

19 1,231 65 791 - 2,106

Balance as at 31 December 2013 459 1,682 208 791 658 3,798

Accumulated impairment as at 31 December 2013

1,698 2,914 251 - - 4,863

The participations item relates to the following capital interests:

Name LocationShare of issued capital%

THR B.V. Apeldoorn (Netherlands) 36.0

De Kruyf Holding B.V. Nijkerk (Netherlands) 25.0

Mechanisatie Beheer B.V. Beilen (Netherlands) 25.0

Outlet-DHZ-Valkenswaard B.V. Valkenswaard (Netherlands) 100.0

The ‘receivables from participations’ item represents the (subordinated) loans provided to the

participations THR B.V., De Kruyf Holding B.V., Mechanisatie Beheer B.V. and Outlet-DHZ-Valkenswaard

B.V. (formerly trading as Fixet Valkenswaard B.V.) with a total principal of € 2.5 million. A total of

€ 1.3 million was provided in loans in 2013, as part of efforts to find a long-term solution for THR B.V.

The latter will repay these loans at some point in the future. The subordinated loan provided to

De Kruyf Holding B.V. has a 20-year term, based on an annual interest rate of 5.5%. The loan will be

repaid in equal quarterly instalments. The subordinated loan provided to Mechanisatie Beheer B.V. has



a 10-year term and is subject to an annual 4.3% interest rate. This loan is to be repaid in equal monthly

instalments. The receivable from Outlet-DHZ-Valkenswaard B.V. is fully provided for.

The ‘other receivables’ item represents the subordinated loan provided to DGN retail B.V., which

acquired the operation of Fixet Retailgroep, along with receivables from Fixet franchisees that were

not acquired by DGN retail B.V. The term and repayment of the loan provided by DGN retail B.V. is

linked to the transition of the franchise contracts from Royal Reesink to DGN retail B.V. The interest

rate is based on the 12-month Euribor rate with a spread of 300 basis points and is set on 1 January

of each year. The liability to Fixet franchisees related to the receivable from DGN retail B.V. has been

deducted from this amount.

The ‘other securities’ item represents exchange-listed shares in Vereenigde Ingenieursbureaux

“VIBA” N.V., which are designed to be held on a long-term basis. The market value of the securities is

€ 0.7 million and has remained unchanged from last year.

5 INVENTORIES

2013 2012

Trading goods 93,605 62,397

Work in progress 832 105

Provision for obsolescence -12,259 -6,985

82,178 55,517

Prepaid on inventories 8,140 7,880

90,318 63,397

At year-end 2013, trading goods were valued at € 89.9 million (2012: € 56.2 million) at the acquisition

price or at a lower market value and at € 3.7 million (2012: € 6.2 million) at replacement cost.

6 RECEIVABLES

2013 2012

Receivables from trade debtors 51,939 25,207

Taxation and social security contributions 195 30

Other receivables 4,814 2,094

56,948 27,331


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Receivables from trade debtors

At year-end 2013, the bad-debt provision was € 2.8 million (2012: € 1.6 million). Trade debtors include

€ 3.1 million in receivables from participating interests (2012: € 1.7 million). Receivables from trade

debtors have a remaining term of less than one year.

Other receivables

Other receivables do not include receivables from participations (2012: € 0.2 million). The other

receivables contain no items with a remaining term of more than one year.

7 CASH AND CASH EQUIVALENTS

The remainder of the capital raised in the rights issue launched in early November 2012 has been

reserved for future acquisitions. Consequently, an amount of € 3.5 million (2012: € 4.3 million) of cash

and cash equivalents has been blocked.

8 GROUP EQUITY

Legal entity’s share in group equity

For notes on the legal entity’s share in group equity, please refer to note 28 on shareholders’ equity

in the company financial statements.

Minority interest

This balance sheet item includes the minority interest that represents the third-party share in the

shareholders’ capital of the group company Bruggeman Mechanisatie. This is shown in the table below.

2013 2012

Balance as at 1 January -50 -64

Changes:

- Result after tax on profit 24 14

Balance as at 31 December -26 -50

9 SUBORDINATED CONVERTIBLE LOANS

The subordinated convertible loans include a € 10.3 million (2012: nil) loan from Pon Onroerend Goed B.V.

(wholly-owned subsidiary of Pon Holdings B.V.). This loan was provided by Pon Onroerend

Goed B.V. as part of the acquisition financing from RMHE. The subordinated convertible loan has a term

of five years (with an option of a one-year extension) and a conversion price of € 81.41 which can be

adjusted in accordance with the provisions of the agreement. The conversion right can be exercised

once this three-year period has passed. The annual interest rate is 5.25%.



10 PROVISIONS

2013 2012

Provision for deferred tax liabilities 12,255 10,723

Pension provision 494 -

Provision for warranty commitments 1,268 792

Provision for jubilee benefits 875 271

Other provisions 256 -

15,148 11,786

Provision for deferred tax liabilities

The provision for deferred tax liabilities includes the tax effect of the differences between commercial

and fiscal profit determination. The table below shows the provision for deferred tax liabilities:

Deferred tax assets2013

Deferred tax liability2013

Deferred tax assets2012

Deferred tax liability2012

Intangible fixed assets 54 1,124 - -

Tangible fixed assets 407 6,307 - 4,557

Investment property - 3,903 - 4,789

Financial fixed assets 78 15 - -

Inventories - 1,371 135 1,448

Provisions 74 148 45 59

Debts 32 32 - 50

Total 645 12,900 180 10,903

On balance -645 -645 -180 -180

Net deferred tax liability - 12,255 - 10,723

Deferred tax liabilities with a remaining term of one year or less are € 2.0 million (versus € 1.4 million

in 2012).

00:00 01:00 02:00 03:00 04:00 05:00 06:00 07:00 08:00 09:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00

Maastricht, 7 a.m. Royal Reesink is there for you – anywhere, anytime


00:00 01:00 02:00 03:00 04:00 05:00 06:00 07:00 08:00 09:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00


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The table below shows changes in the provision for deferred tax liabilities:

2013 2012

Balance as at 1 January 10,723 10,824

Changes:

- Addition charged to the profit and loss account 17 626

- New or discontinued consolidation 2,200 -123

- Adjustment for previous years - -32

- Change relating to adjustment of fair value -231 -254

- To current tax liability -454 -318

Balance as at 31 December 12,255 10,723

The table below shows the changes in other provisions.

Pension provision

Provision for guarantee commitments


Other provisions

Balance as at 1 January 2013 - 792 271 -

Changes:

- Additions charged to the profit and loss account - 601 39 -

- New consolidations 503 548 594 263

- Withdrawals - -598 -29 -7

- Release to be added to the profit and loss account -9 -75 - -

Balance as at 31 December 2013 494 1.268 875 256

Pension provision

Employees of Motrac Intern Transport are subject to early retirement schemes. These schemes are

intended for members born in 1950, 1951 or 1952 (under the SUM scheme) and members born during

the period from 1 January 1953 to 1 January 1973 (under the SUMO scheme).

Subject to various conditions, these members can become eligible for benefits for periods in the past

during which they accrued fewer pension entitlements than permitted. A provision has been included

for the non-financed portion. The provision is financed at the cash value of the future expenses, using

a notional interest rate of 4% and factoring in the likelihood of the employee remaining with the

company and the employee’s death. This provision is of a long-term nature.

Provision for warranty commitments

The provision for warranty commitments is designed for liabilities arising as a result of non-compliance

of delivered products with the agreed quality requirements based on agreed contractual provisions.



The provision is created based on the most accurate estimate of the amounts required for settlement,

usually based on empirical data. This provision is of a short-term nature.


This provision has been discounted using a notional interest rate of 4% (2012: 4%) and an expected

future salary increase of 2% (2012: 2%). This provision is of a long-term nature.

11 NON-CURRENT LIABILITIES

2013 2012

Value of non-current liabilities 38,528 15,567

Current portion of non-current debts (see note 12) -7,621 -1,023

30,907 14,544

The table below shows the repayment scheme for the non-current liabilities.

< 1 year

2-5 years

> 5 years Total

Subordinated loan - - 176 176

Bank loan 7,530 30,430 217 38,177

Financial leasing commitments 91 84 - 175

7,621 30,514 393 38,528

The subordinated loan was provided by the shareholder of the minority interest in Bruggeman

Mechanisatie. Interest on this loan is based on the bank interest for current-account facilities plus a

spread of 150 basis points. Since the solvency ratio at Bruggeman Mechanisatie is currently below

30%, no repayments are currently made on this loan.

On 16 October 2013, a total of € 23.6 million was drawn down from the acquisition facility as part of

the acquisition financing for RMHE. The bank loan also includes the financing expenses to be amortised.

For further details, please see note 12.

The bank loan further includes a mortgage loan relating to the investment property held by Kemp in

Hamme, Belgium. This loan is divided into two loans with principals of € 0.4 million and € 0.8 million,

respectively, where the property in question has been mortgaged. The interest rate payable on these

loans is 4.92% and 5.2%, respectively, and the respective remaining terms are 4.6 years and 9.3 years.

An amount of € 0.1 million is payable on these loans annually.


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The financial leasing commitments relate to the financing of the vehicles at Packo Agri and Packo &

Heybroek in Belgium. Average interest rate on these loans is 2.1%, and the remaining term is two

years.

12 CURRENT LIABILITIES

2013 2012

Debts to credit institutions 34,069 29,782

Current portion of non-current debts 7,621 1,023

Trade creditors 26,235 19,917

Taxation and social insurance contributions 11,418 5,120

Other liabilities and accrued liabilities 31,281 6,869

110,624 62,711

Debts to credit institutions

The financing facility agreed with ABN AMRO and Rabobank on 31 October 2012 was adjusted on

a number of points in 2013 in connection with the RMHE acquisition. The main changes related to an

adjustment of the existing or permitted debts and an increase in the permitted investment level.

The structure of the financing remained unchanged in 2013.

As an extension of the RMHE acquisition and the acquisition of the business of CT Agro GmbH, the

financing facility was increased in early 2014 as a result of the addition of Commerzbank as a third

financier. The mortgage loan did not change as a result (principal of € 15.0 million and repayment of

€ 0.9 million per year). In addition, a portion of the acquisition facility drawn down at year-end 2013

was converted into a long-term loan (€ 20 million, based on repayment of € 2.8 million a year) and the

asset base facility has been raised from € 45.0 million to € 65.0 million. Finally, a new € 10 million

acquisition facility was agreed for future acquisitions. This brings the total financing facility to

€ 110 million. The interest rate depends on the facility, based on 1-month or 3-month Euribor plus an

average spread of 241 basis points (2012: 238 basis points). The main terms (covenants) of the

financing facility have remained unchanged.

The financing facility referred to above is subject to a number of terms and conditions, the main ones

of which are:

●● Debt Service Coverage Ratio of at least 1.3 during the term of the financing

●● Total Net Senior Debt/EBITDA Ratio of a maximum of 3.6 at the end of December 2013, to be

reduced to 3.0 by the end of June 2015.

●● Solvency rate of at least 35%

The stated terms and conditions have been satisfied as at 31 December 2013:

●● Debt Service Coverage Ratio: 5.8

●● Total Net Senior Debt/EBITDA Ratio: 2.6

●● Solvency rate: 40%



The securities provided include the mortgage registration on the land and buildings for the company’s

own use, along with pledges on inventories, business inventory, receivables and bank assets.

Our operations in Belgium (Packo Agri, Packo & Heybroek and Kemp) and Bruggeman Mechanisatie are

financed on a separate (local) basis. The total amount of these credit facilities is € 7.3 million (of which

€ 1.5 million represents seasonal financing). This mainly involves the issue of securities in the form of

(the right of pledge of) inventories, machinery and equipment and receivables. Interest is based mainly

on 1-month Euribor plus an average spread of 110 basis points.

Trade creditors

Trade creditors includes a € 0.7 million debt to participating interests (2012: € 0.4 million).

Other liabilities and accrued liabilities

Other liabilities and accrued liabilities includes a debt to participating interests in the amount of

€ 0.2 million (2012: € 0.2 million).

13 NET REVENUE

The table below shows net revenue specified by segment:

2013 2012

Equipment 197,998 137,173

Industries 38,560 48,049

Net revenue 236,558 185,222

The table below shows net revenue by geographic area:

2013 2012

The Netherlands 164,072 140,667

Belgium 51,062 36,073

Germany 18,803 7,708

Other EU 1,959 564

Non-EU 662 210

Net revenue 236,558 185,222


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14 WAGES AND SALARIES

2013 2012

Gross wages and salaries 22,335 13,424

Social security costs 3,648 2,212

Pension costs 1,537 1,074

Other personnel costs 1,788 1,445

29,308 18,155

Staff

During the 2013 financial year, the average number of employees at Royal Reesink, converted into full

man-years, was 467 (2012: 293).

Of this number, a total of 127 (2012: 40) were employed outside the Netherlands.

This number (average number of individuals calculated based on full man years) breaks down as

follows based on the various employee categories:

2013 2012

Management Board and management 18 15

Procurement 12 12

Sales 115 76

Service and warranty 170 63

Warehouse and logistics 81 80

Back office 71 47

467 293

Pensions

At year-end 2013 (and 2012), Royal Reesink had no pension receivables and no commitments besides

the payment of premiums owed to the pension provider.

As at 31 December 2013, the funding ratios of the Metaal en Techniek (PMT) occupational pension

fund and Bedrijfspensioenfonds voor de Landbouw (BPL), which administer the pension schemes of

Kamps de Wild, Hans van Driel, Landtech Zuid and Bruggeman Mechanisatie and Ben Kemp Holding,

were 103.8% and 109.7%, respectively (2012: 92.4% and 105.8%, respectively).



15 DEPRECIATION AND AMORTISATION ON FIXED ASSETS

2013 2012

Service contracts 119 -

Software 320 -

Equipment 1,190 1,089

Rental equipment 2,400 811

Vehicles 452 376

4,481 2,276

16 SPECIAL ITEMS

2013 2012

Outcome of legal proceedings - -195

Restructuring costs - 424

- 229

Outcome of legal proceedings

In 2012, this income represented funds received relating to a settlement and a judgment rendered in

two (old) lawsuits.

Restructuring costs

The steel operations of Reesink Staal and Nederlandse Staal Unie were transferred to the Zutphen site

in 2012. Total costs related to the transfer were € 0.4 million.

17 OTHER OPERATING INCOME

2013 2012

Rental income 1,752 2,099

Management fee 1,500 216

3,252 2,315


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Rental income

The direct operating expenses relating to the investment property totalled € 0.1 million (2012: € 0.1 million).

Management fee

Royal Reesink provided management services to CT Agro GmbH in 2013. These services mainly

involved new business development, acting as an agent in the sale of equipment in Kazakhstan, and

assisting the client in securing financing. The fee for 2013 consisted of a fixed fee of € 0.2 million and

a variable fee of € 1.3 million. The variable fee was based on the revenues generated by CT Agro

GmbH in Kazakhstan and direct deliveries by supplier Claas in Kazakhstan (sales commissions).

18 TAXATION OF RESULT FROM ORDINARY ACTIVITIES

All group companies located in the Netherlands, excluding Bruggeman Mechanisatie, constitute a tax

entity for corporation tax along with Royal Reesink. Corporation tax is included in each of the

companies for the portion that the company in question would be liable to pay as an independent

entity liable to pay tax, taking into account the tax facilities applicable to the company.

The nominal tax rate is 25% (2012: 25%). The tax burden in the profit and loss account for 2013 is

€ 2.0 million, i.e. 30.7% of result before taxes (2012: 269.8%). The table below shows the link between

the nominal and effective tax burden.

2013%

2012%

Nominal taxation 25.0 25.0

Effect of tax rate for foreign jurisdictions 5.3 3.3

Tax-free profit/non-deductible costs 0.4 241.5

Effectieve belastingen 30.7 269.8

19 SHARE IN RESULT OF PARTICIPATIONS

This represents Royal Reesink’s share in the profits of its participating interests THR B.V, De Kruyf

Holding B.V., Mechanisatie Beheer B.V. and Outlet-DHZ-Valkenswaard B.V.



20 NET RESULT PER ORDINARY SHARE

2013Quantity

2012Quantity

Ordinary shares issued as at 1 January 775,691 670,948

Changes during the financial year

- Ordinary shares issued 471,868 104,743

Ordinary shares issued as at 31 December 1,247,559 775,691

Maximum number of potential ordinary shares to be issued - 70,523

Number of diluted ordinary shares 1,247,559 846,214

Average number of ordinary shares outstanding 909,756 704,022

Average number of diluted ordinary shares outstanding 922,185 714,842

Net result (in € 000) 4,509 -4,331

Cumulative preference dividend (in € 000) -94 -47

Net profit allocated to holders of ordinary shares (in € 000) 4,415 -4,378

Net result per ordinary share (in €) 4,85 -6,22

Diluted net result per ordinary share (in €) 4,79 -6,12

21 FINANCIAL INSTRUMENTS

General details

For its ordinary business operations, the company uses a variety of financial instruments, which

expose it to market risk and/or credit risk. All these financial instruments are included in the balance

sheet.

Liquidity risk

Liquidity risk represents the risk that Royal Reesink fails to meet its financial commitments, or fails to

do so in time. The company has access to various credit facilities at several banks in order to make

investments, as well as for the day-to-day management of working capital and liabilities (i.e. letters of

credit). These financing facilities are of a short-term nature. Reesink mitigates this risk by assuming a

minimum solvency rate of 40% in order to facilitate raising additional capital if necessary (in some

cases on a temporary basis).

Market risk

Market risk constitutes the risk that income earned by Royal Reesink or the value of the financial

instruments held by the company are adversely affected by changes in market prices, such as interest

rates and exchange rates. The market value of the financial instruments recognised in the balance


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sheet, including liabilities, securities, cash and cash equivalents, non-current liabilities and current

liabilities is close to the book value of these instruments.

Credit risk

Credit risk constitutes the risk of financial loss by Royal Reesink if a buyer fails to satisfy the contractual

obligations entered into. Royal Reesink’s exposure to credit risk is determined primarily by the

individual attributes of individual buyers. The close interaction with our customers, either as part of

the dealer organisation or otherwise, is important in reducing credit risk. In addition, credit risk is also

reduced through the company’s own credit checks of (new) customers based on resources such as

external reports, annual reports and payment history, or by insuring credit risk. The internal credit

limits, which are determined based on the company’s own research, are revised at least once per year.

Customers for whom no credit limit has been set (i.e. by the company or the insurance company) can

only conduct business with Royal Reesink based on guaranteed payment. Kamps de Wild and Reesink

Staal are holders of credit insurance policies.

Goods are delivered subject to retention of title, which means that, in the event of default on payment,

Royal Reesink usually has a preferential debt.

In the equipment segment, credit risk is sometimes concentrated with debtors, mitigated in part by the

credit insurance.

Interest-rate risk

The majority of interest-bearing debts are non-current liabilities and debts to credit institutions. These

debts have a floating interest rate consisting of (mostly) 1-month or 3-month Euribor plus a fixed

interest premium. In consultation with the Supervisory Board, the risk of an interest rate increase is

not hedged.

The remaining interest-rate risk is limited to any changes in the market value of the loans provided.

The majority of these loans have a floating interest rate, plus a fixed interest premium. The loans are

held until maturity. Therefore it is the company’s policy not to use derivative financial instruments to

mitigate (interim) interest rate fluctuations.



Non-current liabilities with a floating interest rate and debts to credit institutions have the following

interest-rate risk profile:

2013 2012

Non-current liabilities, including current portion 37,877 14,952

Debts to credit institutions 34,069 29,782

71,946 44,734

Effect on profit and loss account of floating-interest-rate non-current liabilities and debts to credit institutions in the event of:

Increase in interest rate by 100 basis points -612 -458

Decline in interest rate by 100 basis points 612 458

Currency risk

Currency risk is relatively low. The company’s policy is to hedge this risk each time an order is

placed.

22 OFF-BALANCE SHEET ASSETS AND COMMITMENTS

Tax entity


entity for corporation tax along with Royal Reesink. In addition, there is also a tax entity for VAT for

the majority of the Netherlands-based group companies. On this basis, the companies included in the

tax entities are jointly and severally liable for the tax debt of the tax entity as a whole.

Liability and guarantees

For a list of the companies for which Royal Reesink has filed a declaration in accordance with Section

403, Book 2 of the Dutch Civil Code at the offices of the Commercial Register, please see the section

titled ‘Group relations’ on page 94. On this basis, Royal Reesink is jointly and severally liable for the

debts arising from the legal acts of the companies included in the list.

Conditional commitments

Repurchase commitments were issued up to an amount of € 0.2 million (2012: € 0.2 million) to

customers’ financiers as at 31 December 2013 in connection with trading goods delivered.

In 2010, Royal Reesink acquired all shares in Jean Heybroek, a company located in Houten, the

Netherlands. Up to 2016, the former owner will receive additional payments on the shares provided.

These payments are related to Jean Heybroek’s profit, based on the agreement that Jean Heybroek

must earn enough profit each year to provide Royal Reesink, as a shareholder, with a reasonable basic

return.


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In 2012, Royal Reesink acquired all shares in Ben Kemp Holding in De Meern, the Netherlands. Up to

2016, the former owner will receive additional payments on the shares provided. These payments are

related to Ben Kemp Holding’s profit, based on the agreement that Ben Kemp Holding must earn

enough profit each year to provide Royal Reesink, as a shareholder, with a reasonable basic return.

Claims

Royal Reesink and its consolidated participations are involved in several lawsuits. The outcome of

these lawsuits is not expected to have any material adverse effects on the company’s financial position

as presented in these financial statements.

Multi-year financial commitments

Commitments relating to leases and operational leasing agreements totalled € 74.8 million

(2012: € 9.2 million). Of this amount, € 24.4 million represented current liabilities (2012: € 1.8 million) and

€ 4.3 million represented liabilities with a term exceeding five years (2012: € 3.8 million). The increase

in the multiannual financial commitments is mainly the result of leased equipment and service buses

for RMHE (acquired in 2013) and underlying companies.

Multi-year financial rights

Reesink and THR B.V. signed a 10-year lease in 2011 for the building at Ecofactorij in Apeldoorn.

The annual rent is € 1.8 million. The rent is indexed on 1 January of each year.

The guaranteed cash flow from rental equipment and service contracts entered into totals

€ 96.7 million (2012: nil). Of this amount, € 31.6 million relates to the upcoming financial year.

Bank guarantees

The company’s suppliers provided bank guarantees relating to prepayments in the amount of

€ 0.2 million (2012: € 7.5 million).

23 TRANSACTIONS WITH RELATED PARTIES

Identification of related parties

Parties affiliated with Royal Reesink include its management, Supervisory Board members, subsidiaries

and participating interests (including THR B.V.), along with the directors and management employed by

these parties.

Remuneration of Management Board and Supervisory Board members

During the year under review, our Chief Executive Officer, Mr Van der Scheer, received € 397,500 in

salary and a € 82,300 pension contribution (2012: € 350,000 and € 63,100, respectively). The CEO’s

bonus for 2013 was set at € 100,000 (2012: nil). The Chief Executive Officer owns 747 shares/

depositary receipts for shares in Royal Reesink.

The compensation of the Supervisory Board members does not depend on the company’s performance,

and was € 107,000 in 2013 (2012: € 109,500). During the year under review Mr Veerman received a

total of € 35,000; Mr Van Delft, Mr Lievens and Mr Vos each received € 24,000. The members of the

Supervisory Board did not receive any option rights. Supervisory Board member Van Delft (indirectly)



holds 75,378 shares/depositary receipts for shares in Royal Reesink. The other members own no stock

and hold no depositary receipts in the company.

Pursuant to Section 32bd of the Wage Tax Act 1964 (relating to crisis tax), a total of € 41,500 was

payable on the CEO’s compensation as at 31 December 2013 (2012: € 56,000). This crisis tax is not

included in the CEO’s compensation.

Transactions with subsidiaries and participations

Transactions with subsidiaries and participating interests are conducted on an arm’s-length, objective

basis. For a list of (major) subsidiaries and participating interests, please refer to the notes to the

statement of capital interests on page 94.

24 AUDITOR’S FEES

The following fees were charged by Deloitte Accountants B.V. to the company, its subsidiaries and

other companies it consolidates, as provided in Section 382a, Book 2 (paragraphs 1 and 2) of the Dutch

Civil Code.

2013 2012

Audit of the financial statements 330 155

Other assurance services 75 -

Tax advisory services - -

Other non-audit services - -

405 155

25 NOTES TO CASH FLOWS

Following the acquisition in 2013 of the group company RMHE, shares were issued to the seller and

other parties at a total value of € 9.6 million, and the seller provided a convertible subordinated loan

in the amount of € 10.3 million. This loan is not included in the cash-flow statement; solely cash

payments are displayed. The funds held by the group companies were deducted from the purchase

price.


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COMPANY BALANCE SHEET (before profit appropriation)

(in thousands of euros) Notes 31 December 2013 31 December 2012

Fixed assets

Intangible fixed assets 6 -

Tangible fixed assets 26 91 89

Financial fixed assets 27 126,644 80,283

126,741 80,372

Current assets

Receivables from group companies 34,876 16,865

Other receivables 3,398 1,031

Cash and cash equivalents 3,483 4,285

41,757 22,181

Total assets 168,498 102,553

Shareholders’ equity 28

Issued capital 6,030 4,143

Premium reserve 35,257 7,278

Revaluation reserve 14,013 16,530

Reserve for own shares -153 -153

Other reserves 25,453 50,638

Undistributed profit 4,509 -4,331

85,109 74,105

Subordinated loans 9 10,300 -

Provisions 29 50 50

Non-current liabilities 17,141 -

Current liabilities

Debts to credit institutions 30 28,174 25,656

Current portion of non-current liabilities 6,331 -

Other debts 31 21,393 2,742

55,898 28,398

Total equity and liabilities 168,498 102,553



COMPANY PROFIT AND LOSS ACCOUNT


Share result of participating interests after taxation 32 5,063 -1,052

Other result after taxation -554 -3,279

Net result 4,509 -4,331

Notes to the company financial statements

GENERAL DETAILS

The company financial statements are prepared in accordance with the provisions of Part 9 of Book 2

of the Dutch Civil Code. The company financial statements form part of the company’s 2013 financial

statements. For the company’s profit and loss account, the company took advantage of the exemption

under Section 402, Book 2 of the Dutch Civil Code.

To the extent that items in the company balance sheet and company profit and loss account are not

explained below, we refer to the notes to the consolidated balance sheet and profit and loss account.

ACCOUNTING POLICIES

The accounting policies are identical to those for the consolidated balance sheet and profit and loss

account, with the following exceptions:

Financial fixed assets

Participating interests over which the company can exercise material control on the business and

financial policies are valued in accordance with the capital change method based on net asset value.

The company’s accounting policies are used to determine this value. Participating interests with a

negative net asset value are valued at nil. If the company guarantees the debts of the participation in

question, a provision is created. This provision is charged mostly to receivables from this participation,

and for the remainder under the provisions in the size of the share in the losses incurred by the

participation or for the expected payments by the company for the purpose of this participation.

Participations over which no material control is exercised are valued at the acquisition price or at the

long-term lower value in use. Dividends are accounted for in the period in which they are made

payable.

Loans to non-consolidated participations and other receivables are initially recognised at fair value

and subsequently at amortised cost based on the effective-interest method, less impairment losses.


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Income from participations

The share in the profits of participating interests comprises the company’s share in these participations’

earnings. Profits from transactions involving the transfer of assets and liabilities between the company

and its participations and among participations have not been recognised if they can be regarded as

not having been realised.

26 TANGIBLE FIXED ASSETS

The table below shows changes in tangible fixed assets.

Bedrijfs uit rusting


- Purchase price 216

- Accumulated depreciation -127

Book value 89


- Investments 31

- Depreciation -14

- Reclassification -15

2


- Purchase price 219

- Accumulated depreciation -128

Book value 91



27 FINANCIAL FIXED ASSETS

2013 2012

Participations in group companies 100,678 80,141

Receivables from participations 24,500 -

Other participations - -

Receivables from other participations 1,460 136

Other receivables 6 6

126,644 80,283

The table below shows changes in financial fixed assets:

Particpations in group companies

Receivables from paticipations

Other participa-tions

Receivables from other participa-tions

Other receivables

Total

Balance as at January 2013:

- Acquisition price 80,141 - 1,680 2,491 66 84,378


- - -1,680 -2,355 -60 -4,095

Book value 80,141 - - 136 6 80,283


- Investments; loans provided 17,225 24,500 - 1,307 - 43,032

- Disposals; repayment of loans - - - -120 - -120

- Share in result of participating interests 5,063 - - - - 5,063

- Dividend received from participations -1,751 - - - - -1,751

- Impairment - - - -50 - -50

- Reclassification of debts - - - 187 - 187

20,537 24,500 - 1,324 - 46,361

Balance as at 31 December 2013 100,678 24,500 - 1,460 6 126,644

Accumulated impairment as at 31 December 2013

- - 1,680 2,405 60 4,145


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28 SHAREHOLDERS’ EQUITY

Issued capital

Premium reserve

Revaluation reserve


Other reserves

Undistrib-uted profit

Total share-holders’ equity

Balance as at 1 January 2012 3,724 - 17,297 -153 52,484 5,563 78,915

Changes 2012:

- Profit appropriation - - - - 1,286 -1,286 -

- Dividend distributed - - - - 35 -4,277 -4,242

- Net result for financial year - - - - - -4,331 -4,331

- Issue of ordinary shares/depositary receipts

419 7,278 - - - - 7,697

- Goodwill paid on acquisition - - - - -2,868 - -2,868

- Revaluation of tangible fixed assets

- - -767 - 4 - -763

- Other - - - - -303 - -303

Balance as at 31 December 2012

4,143 7,278 16,530 -153 50,638 -4,331 74,105

Changes 2013:

- Profit appropriation - - - - -4,331 4,331 -

- Net result for financial year - - - - - 4,509 4,509

- Issue of ordinary shares/depositary receipts

1,887 27,979 - - - - 29,866

- Goodwill paid on acquisition - - - - -23,446 - -23,446

- Revaluation of tangible fixed assets

- - -2,517 - 2,031 - -486

- Other - - - - 561 - 561

Balance as at 31 December 2013

6,030 35,257 14,013 -153 25,453 4,509 85,109

Other changes include adjustments that correspond to valuation differences for the portion of the

inventories of Reesink Staal valued at the replacement value, after deduction of the expected

tax liability. At year-end 2013, the amount of the reserve for price differences in inventories was

€ 2.7 million (2012: € 3.0 million). This reserve for price differences does not represent a statutory

reserve within the meaning of Section 373, Book 2 (paragraphs 4) of the Dutch Civil Code.



Issued capital

Ordinary shares

Cumulative preference shares A

Cumulative preference shares B

Total

Authorised share capital 10,160 1,840 12,000 24,000

Less: shares in portfolio -5,170 -800 -12,000 -17,970

Issued share capital 4,990 1,040 - 6,030

The authorised share capital consists of 2,540,000 ordinary shares (2012: 1,840,000); 460,000

cumulative preference shares A (2012: 460,000) and 3,000,000 cumulative preference shares B (2012:

2,300,000). The net asset value of each share/cumulative preference share is € 4.00. Reesink is obliged

to pay a total of € 46,800 in dividend to the holder of the cumulative preference shares A for the years

under review prior to the current year under review.

At year-end 2013, the total number of shares outstanding was 1,507,559, including 1,247,559

ordinary shares (1,189,151 certified and 58,408 registered) and 260,000 cumulative preference

shares at Recopart B.V. The net asset value per share is € 4. In October, the private placement of

203,603 and 150,756 depositary receipts for ordinary shares with qualified investors and Pon

Holdings B.V. was completed at an issue price of € 63.85. Furthermore, in January and October a total

of 70,523 depositary receipts for ordinary shares were issued under the equity facility with Project

Holland Deelnemingen B.V. at an issue price of € 74. The public rights issue of 46,986 depositary

receipts of ordinary shares at an issue price of € 63.85 was completed at the end of November.

The net proceeds from the rights issues totalled € 29.9 million.


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1) Mr F.L.H. van Delft holds this package of shares through the aforementioned company. At the time of Mr Van Delft’s appointment as a member

of the Supervisory Board, the company and he agreed that he, along with the other members of the Board and the management, would refrain,

up to 12 months after his retirement as a member, from selling the package held by his company, Bibiana Beheer B.V. He will continue to hold

this package (albeit indirectly) at his own risk and expense until the aforementioned term of 12 months has expired.

2) Potential stake – see below.

We had registered the following interests exceeding 3% of the issued capital (31 December 2013:

1,507,559 shares) at year-end 2013:

Date of first registration

Date of most recent registration

Based on most recent registration

Issued capital%

Depositary receipts of shares%

Bibiana Beheer B.V. 1) 30-04-2003 31-12-2013 - 5.00

Decico B.V. 05-04-2013 31-12-2013 - 5.45

Recopart B.V. 22-01-1997 31-12-2013 17.25 2.30

Stichting Administratiekantoor van Aandelen Reesink 01-01-1992 31-12-2013 78.88 -

Delta Lloyd Deelnemingen Fonds N.V. 23-05-2006 31-12-2013 - 11.61

Todlin N.V. 21-01-2011 31-12-2013 - 8.03

Pon Holdings B.V. 16-10-2013 31-12-2013 - 10.00

Project Holland Deelnemingen B.V. 18-01-2013 31-12-2013 - 13.90

Stichting Continuïteit Reesink 01-02-1992 - 2) -

Stichting Continuïteit Royal Reesink has been granted the right to acquire all cumulative preference

shares B included in our authorised capital. The company and the foundation agreed that the number

of votes cast on the cumulative preference shares B will not exceed the number of ordinary shares

outstanding at that time and cumulative preference shares A combined.

At year-end 2013, the management of Stichting Continuïteit Royal Reesink was comprised of three

members not affiliated with Royal Reesink: Mr R. van Dam, Mr J. Reesink and Mr H.A.A. Kienhuis.

The exercise of the option right and of the voting right by Stichting Continuïteit Royal Reesink, as

described above, serves as a protective measure. This measure is expected to be used, if the

management of Stichting Continuïteit Royal Reesink deems this desirable with due observance of the

statutory provisions and the foundation’s byelaws. The company has committed itself to Stichting

Continuïteit Royal Reesink to compensate all reasonable expenses to be incurred.

In addition, the issue of depositary receipts for ordinary shares with (up to 1%) limited exchangeability

constitutes an anti-takeover measure. We also refer to the company’s considerations in this regard and

detailed in the statement regarding Corporate Governance, as published by Royal Reesink on its

website.



At year-end 2013, the Board of the trust office Stichting Administratiekantoor van Aandelen Royal

Reesink was comprised of three members who are not affiliated with Royal Reesink: Mr W.G. van Hassel,

Mr H.A.D. van den Boogaard and Mr A.D. Plaggemars. Mr B. Vos represents the company on the Board

of the trust office Stichting Administratiekantoor van Aandelen Royal Reesink.

The Management Board of Royal Reesink hereby confirms that it has satisfied the criterion of

independence, subject to the definition provided in Section 118a of Book 2, paragraph 3 of the Dutch

Civil Code.

Premium reserve

This reserve contains revenues from the issue of shares, to the extent that these exceed the net asset

value of the shares (revenues above the net asset value) less the costs related to the issue of shares,

taking into account the deferred tax liability.

Revaluation reserve

The land and buildings (tangible fixed assets plus investment property) are valued at fair value.

A revaluation reserve is created for changes in the valuations at the start of the application of the

Fair Value Resolution (Besluit Actuele Waarde) as at 1 January 2006 and the changes at the end of the

financial years that are recognised in shareholders’ equity (see notes 2 and 28), taking into account

deferred tax liabilities. Furthermore, the revaluation reserve is changed for the value changes of

investment property taken to the profit and loss account during the previous financial year (see notes

3 and 28). The revaluation reserve qualifies as a statutory reserve, and is therefore not at the disposal

of the shareholders.


The acquisition price of € 153,195 of the 5,840 shares/depositary receipts held by the group as at

31 December 2013 was deducted from shareholders’ equity. The ordinary shares/depositary receipts

purchased have a net asset value of € 4. Based on statutory provisions, the value of these shares

owned has not been capitalised in the balance sheet. The ordinary shares/depositary receipts

purchased currently represent 0.39% (2012: 0.56%) of the share capital issued.

Undistributed profit

It is proposed that the general meeting of shareholders distribute the profit after taxation for 2013 as

follows: an amount of € 1,296,000 to be added to the remaining reserves; and to pay the remaining

amount of € 3,213,000 as dividend, including € 94,000 as dividend on the cumulative preference

shares A.

29 PROVISIONS

Provisions represent a provision for deferred tax liabilities relating to the different valuation of assets

for tax purposes, and are mostly long-term in nature.



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30 DEBTS TO CREDIT INSTITUTIONS

For the composition of, and conditions related to, the financing facility, please see note 12 to the

consolidated balance sheet.

31 OTHER DEBTS

Other debts include a € 18.2 million earn-out fee including interest (2012: nil) relating to the RMHE

acquisition.

32 SHARE IN THE RESULT OF PARTICIPATING INTERESTS

This represents the company’s share in the result of participating interests, along with any impairments

of the participations. Of this amount, a total of € 5.4 million (2012: € 2.8 million) relates to group

companies.

33 OFF-BALANCE SHEET COMMITMENTS

Tax entity


entity for corporation tax along with Royal Reesink. In addition, there is also a tax entity for VAT for

the majority of the Netherlands-based group companies. On this basis, the companies included in the

tax entities are jointly and severally liable for the tax debt of the tax entity as a whole.

Liability and guarantees

For a list of the companies for which Royal Reesink has filed a declaration in accordance with

Section 403 of Book 2 of the Dutch Civil Code at the offices of the Commercial Register, please see

the section titled ‘Group relations’ on page 94.

On this basis, Royal Reesink is jointly and severally liable for the debts arising from the legal acts of

the companies included in the list.

Conditional commitments

In 2010, Royal Reesink acquired all the shares in Jean Heybroek, a company based in Houten, the

Netherlands. Up to 2016, the former owner will receive an additional payment for the shares provided,

which will be related to the profit earned by Jean Heybroek, based on the condition that annual profit

must be sufficient in order to offer shareholder Royal Reesink a reasonable basic return.

In 2012, Royal Reesink acquired all the shares in Ben Kemp Holding in De Meern, the Netherlands.

Up to 2016, the former owner will receive an additional payment for the shares provided, which will

be related to the profit earned by Ben Kemp Holding, based on the condition that annual profit

must be sufficient in order to offer shareholder Royal Reesink a reasonable basic return.



Claims

Royal Reesink and its consolidated participations are involved in several lawsuits. The outcome of

these lawsuits is not expected to result in any material adverse effects on the company’s financial

position as presented in these financial statements..


Management Board: Supervisory Board

G. van der Scheer C.P. Veerman, Chairman

F.L.H. van Delft

L. Lievens

B. Vos

00:00 01:00 02:00 03:00 04:00 05:00 06:00 07:00 08:00 09:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00

Zutphen, 11 a.m. Royal Reesink is there for you – anywhere, anytime


00:00 01:00 02:00 03:00 04:00 05:00 06:00 07:00 08:00 09:00 10:00 11:00 12:00 13:00 14:00 15:00 16:00 17:00 18:00 19:00 20:00 21:00 22:00 23:00 24:00


Other informationAUDIT OPINION PROVIDED BY THE INDEPENDENT AUDITOR

To: the general meeting of shareholders of Koninklijke Reesink N.V. in Apeldoorn

Report on the financial statements

We have audited the accompanying financial statements 2013 of Koninklijke Reesink N.V., Apeldoorn,

which comprise the consolidated and company balance sheet as at 31 December 2013, the consolidated

and company profit and loss account, the consolidated statement of comprehensive income and the

consolidated cash-flow statement for the year then ended and the notes, comprising a summary of

the accounting policies and other explanatory information.

Management’s responsibility

Management is responsible for the preparation and fair presentation of these financial statements and

for the preparation of the management board report, both in accordance with Part 9 of Book 2 of the

Dutch Civil Code. Furthermore management is responsible for such internal control as it determines is

necessary to enable the preparation of the financial statements that are free from material

misstatement, whether due to fraud or error.

Auditor’s responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We

conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing. This

requires that we comply with ethical requirements and plan and perform the audit to obtain reasonable

assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures

in the financial statements. The procedures selected depend on the auditor’s judgment, including the

assessment of the risks of material misstatement of the financial statements, whether due to fraud or

error. In making those risk assessments, the auditor considers internal control relevant to the entity’s

preparation and fair presentation of the financial statements in order to design audit procedures that

are appropriate in the circumstances, but not for the purpose of expressing an opinion on the

effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of

accounting policies used and the reasonableness of accounting estimates made by management, as

well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis

for our audit opinion.

Opinion with respect to the financial statements

In our opinion, the financial statements provide a true and fair view of the amount and composition

of the capital of Koninklijke Reesink N.V. as at 31 December 2013 and of the profit (loss) and cash

flows for 2013 in accordance with Part 9, Book 2 of the Dutch Civil Code..

OTHER INFORMATION

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Report on other legal and regulatory requirements

Pursuant to Section 393 of Book 2 (paragraphs 5e and 5f) of the Dutch Civil Code, we report that we

have not detected any deficiencies following the audit or the report of the Management Board

(pages 23-84), to the best of our knowledge, that this has been prepared in accordance with Part 9,

Book 2 of the Dutch Civil Code, and that the details required under Section 392 of Book 2 (paragraphs

1b to 1h) of the Dutch Civil Code have been included. We also note that the report of the Management

Report, to the best of our knowledge, is reconcilable with the financial statements as required under

Section 391 of Book 2, paragraph 4 of the Dutch Civil Code.

Zwolle, the Netherlands, 7 April 2014

Deloitte Accountants B.V.

A.J.E. Jansman

OTHER INFORMATION


EVENTS AFTER THE BALANCE SHEET DATE

CT Agro

The acquisition of the business of CT Agro GmbH was completed in early January, including the

purchase of 100% of the shares in the Kazakh-based company CT Agro TOO. This has provided Royal

Reesink access to Kazakhstan, a country with enormous potential for growth and an interesting major

potential sales market for Royal Reesink. CT Agro employs a total of approximately 100 employees

and generated profitable revenue for 2013 of roughly € 40 million. Royal Reesink has agreed with

several of CT Agro’s suppliers that it will act as a guarantor for fulfilment of the obligations relating to

the deliveries.

Increase in bank financing

On completion of the acquisition of the business of CT Agro GmbH in early 2014, Commerzbank joined

the group of financing banks, providing a total of € 20 million. This increased the financing facility to

€ 110 million: a mortgage loan in the original amount of € 15 million; a long-term loan of € 20 million

(to be repaid over a seven-year period); a € 65 million credit facility and a € 10 million acquisition

facility. The term of the committed financing facility remained unchanged at three years (maturity

date: 31 October 2015).

Earn-out fee

The variable purchase price of the shares in PMH-E was € 18.2 million, including interest. Once the

€ 0.7 million in fees agreed with Pon Holdings B.V. relating to contractual provisions have been

deducted, an amount of € 17.5 million will be provided in early April 2014. This will occur by increasing

the subordinated convertible loan contracted with Pon Holdings B.V. by € 7.5 million; a € 4.8 million

subordinated loan contracted with Pon Holdings B.V.; and € 5.2 million from the available banking

facility.

PROFIT APPROPRIATION FOR THE 2012 FINANCIAL YEAR

The 2012 financial statements were adopted at the general meeting of shareholders held on 23 May

2013. The general meeting confirmed the appropriation of the result in accordance with the proposal

submitted to this effect.

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PROPOSAL FOR PROFIT APPROPRIATION FOR THE 2013 FINANCIAL YEAR

Pursuant to Article 13 of the articles of association, result is appropriated as follows:

Net result 4,509

To be added to the other reserves -1,296

Profit in accordance with Article 13, paragraph 2 of the articles of association

3,213

Cumulative preference dividend: 4.5% per (paid-up) preference share A -94

At the disposal of the general meeting of shareholders in accordance with Article 13, paragraph 6 of the articles of association

3,119

Dividend per ordinary share of € 4: € 2.50 on 1,247,559 3,119

If the decision is made to reserve the amount ‘At the disposal of the general meeting of shareholders’

fully for dividend payment, a total of € 2.50 will be paid in dividend per share for the 2013 financial

year to the holders of ordinary shares in the amount of € 4.00, if necessary with a deduction of 15%

dividend tax.

STATUTORY PROVISIONS REGARDING PROFIT DISTRIBUTION

The articles of association contain the following provisions regarding profit distribution:

Profit and loss

Article 13.

1. Subject to the approval of the Supervisory Board, the Management Board is authorised to retain

as much of the profit earned during the most recent financial year as it deems necessary.

2. The amount remaining after application of the foregoing paragraph is used to pay the percentage

specified below of the amount paid on the cumulative preference shares, if possible. If the profit

referred to in the foregoing sentence is not sufficient to distribute the provisions contained therein

and the provisions below will apply first, after the deficit has been settled. The payment on the

cumulative preference shares A is subject to the rate of 4.5% specified above. For the distribution

on the cumulative preference shares B, the percentage specified above is equal to the average

deposit rate of the European Central Bank, plus a mark-up or discount, weighted by the number of

days for which the distribution is paid. The dividend is calculated for the paid-up portion of the

nominal amount.

The mark-up and discount will be 4% maximum and will be adopted by the Management Board

subject to the approval of the Supervisory Board at the time of the first issue of a cumulative

preference share.

3. If, during the financial year for which the distribution on cumulative preference shares referred to

above occurs, the amount paid on these cumulative preference shares has been reduced due

to partial capital reduction or, for the cumulative preference shares B, has been increased in

OTHER INFORMATION


OTHER INFORMATION

respect of a resolution for further payment, the payment will be reduced or, if possible, increased

by an amount equal to the percentage of the amount of the increase or decrease, calculated from

the date of the decrease or the date at which the payment, which has become mandatory, is made.

4. If the profit for a financial year is adopted and one or more cumulative preference shares were

cancelled during that year subject to repayment or have been fully repaid on cumulative preference

shares, those who, as evidenced by the register specified in Article 3 at the time of the cancellation

or repayment referred to above, were the holders of the cumulative preference shares, will have

an inalienable right to distribution of profit as described below. The profit, which may be distributed

to said individuals, is equal to the amount of the payment to which he or she would have been

entitled in accordance with the provisions of paragraph 1, if, at the time the profit was adopted, he

or she would still have been the holder of the cumulative preference shares referred to above, in

proportion to the time elapsed for the period that he or she became the owner of the cumulative

preference shares. For an amendment to the provisions contained in this paragraph, the reservation

referred to in Section 122, Book 2 of the Dutch Civil Code is made.

5. If, in the course of any financial year, cumulative preference shares have been issued, the dividend

on the cumulative preference shares for that financial year, will be reduced on a proportional basis

for that financial year, until the day when the payment on those shares is made..

6. The profit remaining after application of the foregoing paragraph will be at the disposal of the

general meeting of shareholders, either in full or in part for distribution to the holders of ordinary

shares, in proportion to their ownership of ordinary shares, or added to the reserves, provided

that out of this remaining profit an amount equal to 5% of the nominal amount of their shares is at

least distributed to the holders of these ordinary shares, if possible.

7. The company can only distribute profit to the shareholders and other beneficiaries to the extent

that the shareholders’ equity exceeds the amount of the paid-up and called-up portion of the

capital plus the reserves that must be maintained under the law.

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INFORMATION ON THE MANAGEMENT BOARD

In office since:

09/05/2009

Profession/main position:

CEO, Koninklijke Reesink N.V. (statutory)

Significant positions/other positions:

Member, Stichting Administratiekantoor THR

Mr G. van der Scheer (b. 1960), NL

In office since:

12/03/2008


CFO, Koninklijke Reesink N.V. (titular)


Compliance Officer

Board member, De Eendragt Pensioen

Mr G.T.M. Linnenbank (b. 1974), NL


INFORMATION ON THE MANAGEMENT BOARD

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In office since:

16/10/2013


Director, Reesink Construction Equipment

Management Board member, Koninklijke Reesink N.V.


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Mr B. Kemp (b. 1961), NL

In office since:

16/10/2013


Director, Reesink Material Handling Equipment & Motrac

Hydraulics

Management Board member, Koninklijke Reesink N.V.


-

Mr M. de Bos (1971), NL


INFORMATION ON THE SUPERVISORY BOARD

Appointed on/until:

11/05/2004 / Retirement by rotation at 2014 AGM

Profession/former position/main position:

Former CFO / shareholder, Commit Beheer B.V.

Director / shareholder, Bibiana Beheer B.V.

Director / shareholder, Delon Air B.V.


Member of the board of the trust office Stichting

Administratiekantoor Aandelen Recopart

Other supervisory board memberships:

-

Mr F.L.H. van Delft (b. 1946), NL

Appointed on/until:



Former CEO, Bracamonte B.V.

Professor, Tilburg University and Wageningen University

Former Minister of Agriculture and Fisheries


Chairman, Project Authority, Noord/Zuidlijn

Chairman, Vewin

Member, Advisory Board, Prominent

General board member, NWO

Other supervisory board memberships:

Rabobank Nederland

Barenbrug Holland B.V.

USG People (chairman)

KDS

Ikazia Rotterdam hospital (chairman)

Novamedia (chairman)

Mr C.P. Veerman (b. 1949), NL



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Appointed on/until:


Profession/former profession/main position:

Partner-chairman, Lievens&Co. (Accountant/tax consultant,

Tax & Legal Consultancy Firm)


Chairman of the family council of De Speyebeek N.V.

Lecturer, Brugge Business School (K.U.L.)

Lecturer, Foundation of Financial & Estate Planning

Member of the School Authority of Flemish University of Applied

Sciences for Business Studies (VLEKHO)

Regional chairman, Chamber of Commerce (VOKA Bruges area)

Lid Raad van Bestuur:

VOKA (Vlaams Netwerk van Ondernemingen)

International Club of Flanders

Lievens Invest Group NV

Apzi (Association Port of Zeebrugge Interests)

Member of the Boards of Directors of:

VOKA (Vlaams Netwerk van Ondernemingen – Flemish business network)

International Club of Flanders

Lievens Invest Group NV

Apzi (Association Port of Zeebrugge Interests)

Mr L. Lievens (1957), BE

Appointed on/until:



Former Managing Director, TCA

Former member of the Board of Directors, Unigro

Former chairman of the Board, Hema

Former chairman of Landelijke Huisartsen Vereniging

(National Association of General Practitioners)


Board member, trust office Stichting Administratiekantoor

Aandelen Recopart

Chairman of the Supervisory Board, Kempen Capital

Management N.V.

Other supervisory board memberships of listed companies:

PC Emerging Europe Property Fund N.V.

PC Emerging Europe Equity Fund N.V. (chairman)

PC Russian Midcap Fund N.V. (chairman)

Tsjechië en Slowakije Fonds (Czech Republic and Slovakia Fund)

(chairman)

Mr B. Vos (b. 1939), NL



The members of the Supervisory Board have not received any option rights. Supervisory Board

member Van Delft (indirectly) holds 75,378 shares/depositary receipts for shares in Royal Reesink.

The other members own no stock and hold no depositary receipts in our company.

The professions, former professions and main positions and any relevant other positions/additional

positions are listed if they are relevant to the fulfilment of members’ duties as members of the

Koninklijke Reesink N.V. Supervisory Board.


1) After changes in accounting principles effective 1 January 2009. Financial years 2006-2008 have been adjusted accordingly.

2) After changes in accounting principles effective 1 January 2006. Preceding years have not been adjusted.

3) For further information, see note 28.

10 YEARS OF ROYAL REESINK

(in thousands of euros) NoteD-GAAP

2013D-GAAP

2012D-GAAP

2011D-GAAP

2010D-GAAP2009 1)

D-GAAP2008

D-GAAP2007

D-GAAP2006 2)

D-GAAP2005

D-GAAP2004

Net revenue 236,558 185,222 173,364 189,658 163,033 198,643 184,415 169,128 128,880 126,569

Gross operating income 33,516 22,627 20,686 24,429 20,893 24,915 23,777 22,836 16,291 16,566

As a % of net revenue 14.2% 12.2% 11.9% 12.9% 12.8% 12.5% 12.9% 13.5% 12.6% 13.1%

Personnel costs 29,308 18,155 14,719 18,835 16,284 18,046 17,892 17,940 13,677 15,859


Operating income before depreciation and amortisation (EBITDA) 14,902 8,980 10,932 8,810 9,440 11,966 9,842 8,870 6,325 5,856


Operating income (EBIT) 10,421 6,704 9,538 6,996 7,688 10,464 8,214 7,406 4,328 3,659


Net result 4,509 -4,331 5,563 5,856 1,991 7,377 6,524 5,588 3,208 2,890

As a % of net revenue 1.9% -2.3% 3.2% 3.1% 1.2% 3.7% 3.5% 3.3% 2.5% 2.3%

As a % of average shareholders’ equity 3 5.7% -5.7% 7.3% 7.9% 2.5% 8.9% 8.3% 9.5% 7.8% 7.1%

Depreciation 4,481 2,276 1,394 1,814 1,752 1,502 1,628 1,464 1,997 2,197

Cash flow from operating activities 12,600 8,554 2,758 -4,025 7,297 5,942 5,302 2,508 9,065 -2,760

Investments in fixed assets -7,429 -3,189 -2,164 -1,510 10,835 -3,478 -2,553 -1,081 -1,579 -2,575

Acquisition of group companies -37,844 -14,864 -2,288 -5,748 -130 -585 90 -1,263 -97 -

Trading working capital at year end 4 116,022 68,687 66,219 68,939 55,048 55,138 50,985 46,434 32,748 38,790

Retained net profit 1,296 - 1,286 1,113 - 2,634 2,452 2,187 477 159

4.5% Dividend cum. pref. shares A 94 - 47 47 47 47 47 47 47 47

Dividend on ordinary shares 3,119 - 4,230 4,697 2,684 4,696 4,026 3,355 2,684 2,684

Payout ratio 70.6% - 76.7% 80.8% 138.0% 64.1% 62.2% 60.5% 84.9% 94.4%

Average number of employees 467 293 236 364 336 357 361 359 337 368

Fixed assets 98,317 67,737 67,125 59,434 59,033 84,718 79,717 77,793 29,298 29,568

Group equity 85,083 74,055 78,851 72,770 73,522 83,070 77,982 73,839 38,419 38,635

Shareholders’ equity 85,109 74,105 78,915 72,770 73,522 83,068 77,982 73,839 38,419 38,635

Capital base 95,383 74,055 78,851 72,770 73,522 83,070 77,982 73,839 38,419 38,635


909,756 704,022 670,948 670,948 670,948 670,948 670,948 670,948 670,948 670,948

Total assets 252,062 163,096 149,997 142,251 124,976 158,697 144,638 135,433 74,266 78,118

Per ordinary share with a net asset value of € 4,00 per share

Net profit (loss) 4.85 -6.22 8.22 8.66 2.90 10.93 9.65 8.26 4.71 4.24

Dividend 2.50 - 6.00 7.00 4.00 7.00 6.00 5.00 4.00 4.00

Shareholders’ equity 5 92.55 103.93 116.20 108.91 110.03 125.59 118.01 112.09 59.95 60.28

Share price as at year end 70.60 76.00 76.50 71.99 72.60 68.00 105.00 98.95 76.35 55.00



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4) Trading working capital consists of inventories, trade debtors and trade creditors.

5) Calculated for shareholders’ equity, divided by the average number of ordinary shares of the shares/depositary receipts for ordinary shares

purchased, plus the purchase price of the own shares/depositary receipts for own shares purchased (and not included in the balance sheet

under the statutory provisions). For 2013, this increases shareholders’ equity per ordinary share by € 0.17 (versus € 0.22 in 2012).


(in thousands of euros) NoteD-GAAP

2013D-GAAP

2012D-GAAP

2011D-GAAP

2010D-GAAP2009 1)

D-GAAP2008

D-GAAP2007

D-GAAP2006 2)

D-GAAP2005

D-GAAP2004

Net revenue 236,558 185,222 173,364 189,658 163,033 198,643 184,415 169,128 128,880 126,569

Gross operating income 33,516 22,627 20,686 24,429 20,893 24,915 23,777 22,836 16,291 16,566


Personnel costs 29,308 18,155 14,719 18,835 16,284 18,046 17,892 17,940 13,677 15,859


Operating income before depreciation and amortisation (EBITDA) 14,902 8,980 10,932 8,810 9,440 11,966 9,842 8,870 6,325 5,856


Operating income (EBIT) 10,421 6,704 9,538 6,996 7,688 10,464 8,214 7,406 4,328 3,659


Net result 4,509 -4,331 5,563 5,856 1,991 7,377 6,524 5,588 3,208 2,890

As a % of net revenue 1.9% -2.3% 3.2% 3.1% 1.2% 3.7% 3.5% 3.3% 2.5% 2.3%

As a % of average shareholders’ equity 3 5.7% -5.7% 7.3% 7.9% 2.5% 8.9% 8.3% 9.5% 7.8% 7.1%

Depreciation 4,481 2,276 1,394 1,814 1,752 1,502 1,628 1,464 1,997 2,197

Cash flow from operating activities 12,600 8,554 2,758 -4,025 7,297 5,942 5,302 2,508 9,065 -2,760

Investments in fixed assets -7,429 -3,189 -2,164 -1,510 10,835 -3,478 -2,553 -1,081 -1,579 -2,575

Acquisition of group companies -37,844 -14,864 -2,288 -5,748 -130 -585 90 -1,263 -97 -

Trading working capital at year end 4 116,022 68,687 66,219 68,939 55,048 55,138 50,985 46,434 32,748 38,790

Retained net profit 1,296 - 1,286 1,113 - 2,634 2,452 2,187 477 159

4.5% Dividend cum. pref. shares A 94 - 47 47 47 47 47 47 47 47

Dividend on ordinary shares 3,119 - 4,230 4,697 2,684 4,696 4,026 3,355 2,684 2,684

Payout ratio 70.6% - 76.7% 80.8% 138.0% 64.1% 62.2% 60.5% 84.9% 94.4%

Average number of employees 467 293 236 364 336 357 361 359 337 368

Fixed assets 98,317 67,737 67,125 59,434 59,033 84,718 79,717 77,793 29,298 29,568

Group equity 85,083 74,055 78,851 72,770 73,522 83,070 77,982 73,839 38,419 38,635

Shareholders’ equity 85,109 74,105 78,915 72,770 73,522 83,068 77,982 73,839 38,419 38,635

Capital base 95,383 74,055 78,851 72,770 73,522 83,070 77,982 73,839 38,419 38,635


909,756 704,022 670,948 670,948 670,948 670,948 670,948 670,948 670,948 670,948

Total assets 252,062 163,096 149,997 142,251 124,976 158,697 144,638 135,433 74,266 78,118

Per ordinary share with a net asset value of € 4,00 per share

Net profit (loss) 4.85 -6.22 8.22 8.66 2.90 10.93 9.65 8.26 4.71 4.24

Dividend 2.50 - 6.00 7.00 4.00 7.00 6.00 5.00 4.00 4.00

Shareholders’ equity 5 92.55 103.93 116.20 108.91 110.03 125.59 118.01 112.09 59.95 60.28

Share price as at year end 70.60 76.00 76.50 71.99 72.60 68.00 105.00 98.95 76.35 55.00



Koninklijke Reesink N.V. Supervisory Board C.P. Veerman, voorzitterF.L.H. van DelftL. LievensB. Vos

Management Board G. van der Scheer, CEOG.T.M. Linnenbank, CFOB. Kemp, lid directieM. de Bos, lid directie

Reesink Equipment B.V. Management Board Koninklijke Reesink N.V.

Reesink Green Equipment B.V. Management Board H.M. Hylkema Beheer B.V.Koninklijke Reesink N.V.

Reesink Construction Equipment B.V. Management Board B. KempKoninklijke Reesink N.V.

Reesink Material Handling Equipment B.V.

Management Board M. de BosKoninklijke Reesink N.V.

Reesink Industries B.V. Management Board Koninklijke Reesink N.V.

Reesink Support B.V. Management Board Koninklijke Reesink N.V.

Reesink Technische Handel B.V. Management Board G. van der ScheerKoninklijke Reesink N.V.

Stierman B.V. Management Board Reesink Technische Handel B.V.

Kamps de Wild Holding B.V. Management Board E. RosKoninklijke Reesink N.V.

Kamps de Wild B.V. Management Board D.K. MelessenKoninklijke Reesink N.V.

Kamps de Wild Participaties B.V. Management Board E. RosKoninklijke Reesink N.V.

Bruggeman Mechanisatie B.V. Management Board Bruggeman Onroerend Goed en Exploitatiemaatschappij Broekland B.V.Kamps de Wild Participaties B.V.

Landtech Zuid B.V. Management Board Kamps de Wild Participatie B.V.

Reesink GmbH Management Board G. van der ScheerG.T.M. Linnenbank

Reesink Duitsland B.V. Management Board Koninklijke Reesink N.V.

Reesink Germany GmbH Management Board G. van der ScheerG.T.M. Linnenbank

Packo Agri N.V. Management Board J. Packo

Packo & Heybroek N.V. Management Board Packo Agri N.V.Jean Heybroek B.V

Jean Heybroek B.V. Management Board H.M. Hylkema Beheer B.V.Koninklijke Reesink N.V.

CT Agro GmbH (voorheen Reesink Agricultural Equipment GmbH)

Management Board J. Voschepoth

Pelzer Fördertechnik GmbH Management Board E. van Leeuwenstijn

Motrac Hydraulik GmbH Management Board C.A. Huisman

Management Board of Koninklijke Reesink N.V. and its operating companies

MANAGEMENT BOARD


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Ben Kemp Holding B.V. Management Board B. KempKoninklijke Reesink N.V.

Huur&Stuur B.V. Management Board B. KempKoninklijke Reesink N.V.

Barend Kemp B.V. Management Board B. Kemp Koninklijke Reesink N.V.

Kemp BVBA Management Board B. KempKoninklijke Reesink N.V.

Motrac Hydrauliek B.V. Management Board Reesink Material Handling Equipment B.V.

Motrac Intern Transport B.V. Management Board M. de BosKoninklijke Reesink N.V.

Motrac Handling & Cleaning N.V./S.A. Management Board R. DanielsonM. de Bos

Reesink Staal B.V. Management Board A.T.M.B. BuitingKoninklijke Reesink N.V.

Nederlandse Staal Unie B.V. Management Board Koninklijke Reesink N.V.

Safety Centre International B.V. Management Board J. LiemKoninklijke Reesink N.V.

Outlet-DHZ-Valkenswaard B.V. Management Board Koninklijke Reesink N.V.

Deelneming:

THR B.V. Management Board J. van Rossum

De Kruyf Holding B.V. Management Board De Kruyf Beheer B.VKamps de Wild Participaties B.V.

Mechanisatie Beheer B.V. Management Board Vrieja Holding B.V. L.A. de Vries Holding B.V.

MANAGEMENT BOARD


Report of the trust office StichtingAdministratiekantoor van Aandelen Royal Reesink

In compliance with the provisions of Article 11, subsection 2 of the trust charter, we are issuing the

report below to the holders of depositary receipts of ordinary shares in Koninklijke Reesink N.V. (the

‘Company’).

During the 2013 financial year, the duties of the foundation consisted of holding, issuing and

administering ordinary shares in the Company, each with a net asset value of € 4, and against those

shares issuing exchangeable bearer certificates. During the year under review, Hollandsch

Administratiekantoor B.V. carried out the administrative duties related to the issue of depositary

receipts of ordinary shares.

At 31 December 2013, the foundation held 1,189,151 shares in the Company, against which it issued

an equivalent number of exchangeable bearer certificates. The number of shares held by the trust

office increased by 472,064 in 2013. This increase was caused by, among other things, the private

placement to qualified investors, placement with Pon Holdings B.V., the public rights issue and the

drawdown under the equity facility.

The Board of Trustees convened on two occasions during the 2013 financial year. The meeting held on

8 April 2013 was devoted to adopting the trust office’s own financial statements and preparing the

company’s annual general meeting. The meeting held on 29 November 2013 was used to discuss

general business. The articles of association were amended on 22 April 2013, as discussed in the

meeting of 8 November 2012. In addition, the Board of Trustees was also closely involved in the

formal decision-making process relating to the certification of shares and the issue of the depositary

receipts to investors.

The Board of Trustees of the trust office attended the company’s annual general meeting held on 23

May 2013. Its members also attended the extraordinary general meeting of shareholders held on 2

July 2013, which was held in relation to the proposed acquisition of the material handling business

and hydraulic components/systems of Pon Holdings B.V. A total of 67 holders of depositary receipts

for shares (representing 530,427 depositary receipts) took advantage on 23 May 2013 of the

opportunity offered to the depositary receipt holders present to exercise their voting right, as they

saw fit, by proxy on behalf of the trust office. The trust office represented 22.37% of the votes cast

during this meeting. On 2 July 2013, a total of 40 depositary receipt holders (representing 552,752

depositary receipts) exercised their voting right. In this meeting, the trust office represented 20.32%

of the votes cast. The trust office voted on all matters raised during these meetings.

In accordance with the articles of association, the management board was composed in 2013 of three

members not affiliated with the company (board members B) and one member designated by the

company (board member A).

TRUST OFFICE


The Board of the Trust Office currently comprises the following members:

1. W.G. van Hassel, board member B, chairman;

2. H.A.D. van den Boogaard, board member B;

3. A.D. Plaggemars, board member B;

4. B. Vos, board member A.

Mr B. Vos was appointed Board member A effective 30 June 2013, succeeding Mr B. van der Weerden.

The total amount paid in remuneration to Board members in the year under review 2013 was €

6,628.00. The trust office incurred a total of € 28,627.78 in expenses. During the year under review

2013, the trust office sought external advice regarding the amendment of the articles of association.

The address of the trust office Stichting Administratiekantoor van Aandelen Royal Reesink is:

Ecofactorij 20, NL-7325 WC Apeldoorn, the Netherlands.


The Board of Trustees

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TRUST OFFICE

Koninklijke Reesink N.V. Ecofactorij 20 – 7325 WC Apeldoorn – P.O. Box 1411, 7301 BR Apeldoorn - The Netherlands – T +31(0)575 599301

W royalreesink.com – E [email protected] – Registered office Apeldoorn – Commercial Register number 08005560

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