1.40 Provisions

The provision for personnel-related benefits mainly relates to the liability for anniversary bonuses.

1.40.1 Anniversary provision

The anniversary provision is determined according to the ‘Projected Unit Credit Method’. This provision is calculated on the basis of actuarial principles, taking account of expected likelihood to stay, salary increases and a discount rate of 1.04% on average (2024: 0.84%). For the most part, the term of the provision is longer than one year.

1.40.2 Restructuring

In 2023, a restructuring provision was made for the closure of Helvoet Hellevoetsluis. An agreement was reached with the trade unions, and the plan was published and communicated publicly through a press release. At the end of 2025, the provision was entirely short-term.

1.40.3 Warranty obligations

The provision for warranty obligations is based on historical warranty costs for products still within their warranty period. Given its limited term, this provision is not discounted.

1.40.4 SAR scheme

The group’s Management Board and a number of operating company board members have a SAR scheme under which they receive remuneration based on the company’s increase in value over a period of four or five years. Unless Hydratec is sold to third parties, this increase in value is based on a rate of 1%-5% of 5 times the average EBIT over 3 or 4 financial years. The expected final value is based on the expected EBIT from Hydratec’s Long-Term Plans rather than the expected value on sale to third parties. The SAR provision without exit was determined under IAS 19 using the “Projected Unit Credit Method”. The liability is discounted at an interest rate of 4%. The estimated likelihood of remaining ranges from 60% to 100% during the period until the first right of exercise. The SAR is exercised if more than 50% of the shares in the group entity or group are transferred to a third party. The exit value in that case is the higher of 5 times the average EBIT over the last 3 or 4 financial years and the value based on the sale price. The probability of this happening is low and has therefore not been measured in accordance with IFRS 2. If the employment relationship between Hydratec and a board member ends before this scheme takes effect, the SAR will lapse, unless the employment was terminated by death or pursuant to Book 7, Article 669(3)(a) and (b) of the Dutch Civil Code. In that case, the board member is entitled to 33.3% of the amount. The SAR can only be exercised once within a period of one month after Hydratec’s consolidated annual figures have been approved by the auditor, and no sooner than the term of the scheme.

For the Group’s Management Board, a maximum of 0.5% of the value is granted annually by the Supervisory Board, up to a maximum of 2.5% over the five years. The annual allocation to the Group’s Management Board is made at the discretion of the Supervisory Board. Hydratec estimates that an average of 80% of this will be granted in the next 3 years. For 2025, 100% has been allocated.

1.40.5 Other

The other provisions mainly relate to the earn-out scheme. Estimates have been made to determine the provisions. There may therefore be variances between the carrying amount of the provisions on the balance sheet date and the actual outflow of funds. For the most part, these are non-current provisions.

1.40.6 Deferred tax liabilities

Deferred tax liabilities can be broken down as follows:

For the most part, this is a non-current provision.