07.1 Statutory provisions on profit appropriation
Pursuant to article 27 of the articles of association of Royal HZPC Group B.V., a percentage of the company's profit to be determined by the Executive Board with the approval of the Supervisory Board can be added to the reserves while the undischarged losses of previous years are deducted along with the taxes which are, or will be, charged on the basis of the profit, which may be established by means of an estimate if necessary. The remaining profit is available for disposal at the discretion of the General Meeting of Shareholders. The company can only make payouts of profit available for paying out to the shareholders and any other parties that may be thus entitled to the extent that the shareholders' equity is greater than the paid and called-up part of the capital augmented with the reserves that must be maintained by law or under the articles of association.
07.2 Independent auditor's report
To: the shareholders and the supervisory board of Royal HZPC Group B.V.
Report on the audit of the financial statements 2025-2026 included in the annual report
Our opinion
We have audited the accompanying financial statements for the financial year ended 30 June 2026 of Royal HZPC Group B.V. based in Joure.
In our opinion, the financial statements give a true and fair view of the financial position of Royal HZPC Group B.V. as at 30 June 2026 and of its result for the year then ended in accordance with Part 9 of Book 2 of the Dutch Civil Code.
The financial statements comprise:
- The consolidated and company balance sheet as at 30 June 2026
- The consolidated and company profit and loss account for the year then ended
- The notes comprising a summary of the accounting policies and other explanatory information
Basis for our opinion
We conducted our audit in accordance with Dutch law, including the Dutch Standards on Auditing.
Our responsibilities under those standards are further described in the 'Our responsibilities for the audit of the financial statements' section of our report.
We are independent of Royal HZPC Group B.V.(the company) in accordance with the Wet toezicht accountantsorganisaties (Wta, Audit firms supervision act), the Verordening inzake de onafhankelijkheid van accountants bij assurance-opdrachten (ViO, Code of Ethics for Professional Accountants, a regulation with respect to independence) and other relevant independence regulations in the Netherlands.
Furthermore we have complied with the Verordening gedrags- en beroepsregels accountants (VGBA, Dutch Code of Ethics for Professional Accountants).
We believe the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Information in support of our opinion
We designed our audit procedures in the context of our audit of the financial statements as a whole and in forming our opinion thereon. The following information in support of our opinion and any findings were addressed in this context, and we do not provide a separate opinion or conclusion on these matters.
Our focus on fraud and non-compliance with laws and regulations
Our responsibility
Although we are not responsible for preventing fraud or non-compliance and we cannot be expected to detect non-compliance with all laws and regulations, it is our responsibility to obtain reasonable assurance that the financial statements, taken as a whole, are free from material misstatement, whether caused by fraud or error.
Our audit response related to fraud risks
We identified and assessed the risks of material misstatements of the financial statements due to fraud. During our audit we obtained an understanding of the company and its environment and the components of the system of internal control, including the risk assessment process and management’s process for responding to the risks of fraud and monitoring the system of internal control and how the supervisory board exercises oversight, as well as the outcomes. We refer to the section Risk paragraph of the management report for management’s (fraud) risk assessment.
We evaluated the design and relevant aspects of the system of internal control and in particular the fraud risk assessment, as well as the code of conduct, whistle blower procedures and the register of reports received by the Integrity Council. We evaluated the design and the implementation of internal controls designed to mitigate fraud risks.
As part of our process of identifying fraud risks, we evaluated fraud risk factors with respect to financial reporting fraud, misappropriation of assets and bribery and corruption. We evaluated whether these factors indicate that a risk of material misstatement due to fraud is present.
We incorporated elements of unpredictability in our audit. We also considered the outcome of our other audit procedures and evaluated whether any findings were indicative of fraud or non-compliance.
We addressed the risks related to management override of controls, as this risk is present in all organizations. For these risks we have, among other things, performed procedures to evaluate whether the selection and application of accounting policies by the company, particularly those relating to subjective measurements and complex transactions, as disclosed in the Notes “Use of estimates”, “Intangible fixed assets”, “Goodwill” and “Receivables and securities” to the financial statements may be indicative to fraudulent financial reporting. We have also used data analysis to identify and address high-risk journal entries and other adjustments made in the financial reporting process. We evaluated the business rationale (or the lack thereof) of significant extraordinary transactions, including those with related parties.
When identifying and assessing fraud risks we presumed that there are risks of fraud in revenue recognition. We designed and performed our audit procedures regarding cut off of revenue responsive to this presumed fraud risk, among others testing the relationship between purchased and sold quantities of seed potatoes and detailed testing of sales transactions recognized around year-end in the 2025-2026 financial year and credit notes recognized around year-end in the 2026-2027 financial year.
The following fraud risks identified required significant attention during our audit.
| Fraud risk relating to management bias in accounting estimates and capitalization decisions as a result of incentives or pressure to influence reported results, including compliance with bank covenants and the ability to make dividend distributions. This risk particularly relates to the valuation of the allowance for doubtful debts, the capitalization and valuation of intangible assets (Aurora) and the valuation of goodwill (IPM). |
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| Risk | Royal HZPC Group B.V. is subject to bank covenants and has dividend distribution objectives, which may create incentives or pressure for management to influence reported results and the financial position of the company. In this context, we identified a fraud risk relating to management bias in accounting estimates and capitalization decisions. This risk particularly relates to the completeness and valuation of the allowance for doubtful debts, the existence and valuation of intangible assets relating to Aurora and the valuation of goodwill relating to IPM, where inappropriate judgments or assumptions could result in an overstatement of assets and/or results. The risks and developments during the 2025-2026 financial year are described on page 30 for covenants, page 49 for going concern, page 50 for estimates and page 56 intangible fixed assets of the annual report. |
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| Audit procedures | We performed, among others, the following audit procedures specifically designed to address this risk: - We obtained an understanding of management’s processes for the relevant accounting estimates and capitalization decisions, including the design and implementation of relevant controls. - For the completeness of the allowance for doubtful debts, we evaluated management’s estimation process and the reasonableness of the resulting allowance, taking into account relevant supporting evidence and developments after year-end. We also performed a retrospective review of management’s prior-year estimate. - For the existence and valuation of intangible assets relating to Aurora, we evaluated the nature and development of project expenditures and assessed whether the recognized expenditures met the applicable capitalization criteria. We also performed substantive procedures on the capitalized project costs. - For the valuation of goodwill relating to IPM, we evaluated management’s valuation methodology, significant assumptions and underlying data, and considered relevant audit evidence available up to the date of our auditor’s report. - We evaluated whether the related presentation and disclosures in the financial statements were appropriate. |
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| Fraud risk arising from corruption and bribery via commission payments to agents, transactions with governmental authorities or violation of sanction legislation through third-party collection of receivables | ||||
| Risk | Royal HZPC Group B.V. generates part of its revenue in countries that are subject to sanctions. Customers in these countries may experience difficulties in transferring funds directly to Royal HZPC Group B.V., which may result in payments being facilitated through third parties. In this context, we identified the fraud risk of non-compliance with applicable sanctions and anti-corruption laws and regulations in high-risk countries as a relevant risk in our audit. The risk includes the use of intermediaries and the potential for the company to inadvertently become involved in terrorist financing or money laundering through the receipt of funds from unknown third parties. The risks relating to compliance with laws and regulations, including developments during the 2025–2026 financial year, are described on page 28 and 77 of the annual report. |
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| Audit procedures | We performed, among others, the following audit procedures specifically designed to address this risk, involving our forensic specialists in both the planning and execution of these procedures: - Obtained an understanding of the design and implementation of internal controls related to commission payments, transactions with governmental authorities, third party payments and sanctions legislations. - Reviewing (the process for) Know Your Customer (KYC) into identified third-party payments in the 2025-2026 financial year and the follow up given. - Detailed testing of cash receipts from third parties in 2025-2026. - Analytical procedures and substantive testing of commission payments in 2025-2026. - Analytical procedures on transactions and price with governmental authorities. - Inspection of lawyers’ letters. - Inspection of Know Your Customer (KYC) and Know Your Agent (KYA) procedures and documentation. - Inquiry of various management levels within Royal HZPC Group B.V. and those charged with governance (the audit committee and supervisory board) about possible or suspected non-compliance with laws and regulations relating to third-party payments and sanctions legislation. - Obtained an understanding of action and improvement plans from management, compliance department and those charged with governance. - We evaluate the related disclosures in the management report and financial statements for 2025-2026. |
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We considered available information and made enquiries of relevant executives, management and the supervisory board. The fraud risks we identified, enquiries and other available information did not lead to specific indications for fraud or suspected fraud potentially materially impacting the view of the financial statements.
There are (remaining) risks inherent to conducting business with customers in countries where sanctions and restrictions on payment transactions applies (including third party payments), as disclosed on page 28 of the annual report and page 77 of the financial statements.
Our audit response related to risks of non-compliance with laws and regulations
We performed appropriate audit procedures regarding compliance with the provisions of those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. Furthermore, we assessed factors related to the risks of non-compliance with laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general industry experience, through discussions with the management, reading minutes and performing substantive tests of details of classes of transactions, account balances or disclosures.
We have been informed by the management that there was no correspondence with regulatory authorities and remained alert to any indication of (suspected) non-compliance throughout the audit. Finally we obtained written representations that all known instances of non-compliance with laws and regulations have been disclosed to us.
Our audit response related to going concern
The management made a specific assessment of the company’s ability to continue as a going concern and to continue its operations for the foreseeable future. As disclosed in Note “Going concern” in the annual report on page 49 and the Note “Financing” on page 30, parties in the financing agreement issued a waiver to Royal HZPC Group B.V. in respect of the EBITDA covenant breach. The financial statements have been prepared on a going concern basis.
We discussed and evaluated the specific assessment with the management exercising professional judgment and maintaining professional skepticism. We assessed the terms and conditions of the loan agreements, related correspondence with the lenders and the waiver obtained in respect of the covenant breach. As part of our procedures on the management’s going concern assessment, we evaluated management’s forecast and assessment of future covenant compliance, including the underlying assumptions and planned mitigating actions. We considered whether the management going concern assessment, based on our knowledge and understanding obtained through our audit of the financial statements or otherwise, contains all relevant events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion.
Based on our procedures performed, we did not identify material uncertainties about going concern or management’s use of the going concern basis of accounting. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause a company to cease to continue as a going concern.
Compliance with SBR Regulatory Technical Standard, including XBRL mark-ups, unaudited
We did not examine the compliance with the requirements of the Regulatory Technical Standard of the SBR domain Trade Register (including the applied eXtensible Business Reporting Language (XBRL) mark-ups) and, accordingly, do not express an opinion thereon.
Report on other information included in the annual report
The annual report contains other information in addition to the financial statements and our auditor’s report thereon.
Based on the following procedures performed, we conclude that the other information:
- Is consistent with the financial statements and does not contain material misstatements
- Contains all the information as required by Part 9 of Book 2 of the Dutch Civil Code regarding the management report and the other information as required by Part 9 of Book 2 of the Dutch Civil Code
We have read the other information. Based on our knowledge and understanding obtained through our audit of the financial statements or otherwise, we have considered whether the other information contains material misstatements.
By performing these procedures, we comply with the requirements of Part 9 of Book 2 of the Dutch Civil Code and the Dutch Standard 720. The scope of the procedures performed is substantially less than the scope of those performed in our audit of the financial statements.
The management of is responsible for the preparation of the other information, including the management report in accordance with Part 9 of Book 2 of the Dutch Civil Code and other information as required by Part 9 of Book 2 of the Dutch Civil Code.
Description of responsibilities regarding the financial statements
Responsibilities of the management and the supervisory board for the financial statements
The management is responsible for the preparation and fair presentation of the financial statements in accordance with Part 9 of Book 2 of the Dutch Civil Code. Furthermore, the management is responsible for such internal control as the management determines is necessary to enable the preparation of the financial statements that are free from material misstatement, whether due to fraud or error.
As part of the preparation of the financial statements, the management is responsible for assessing the company’s ability to continue as a going concern. Based on the financial reporting framework mentioned, the management should prepare the financial statements using the going concern basis of accounting unless the management either intends to liquidate the company or to cease operations, or has no realistic alternative but to do so. The management should disclose events and circumstances that may cast significant doubt on the company’s ability to continue as a going concern in the financial statements.
The supervisory board is responsible for overseeing the company’s financial reporting process.
Our responsibilities for the audit of the financial statements
Our objective is to plan and perform the audit engagement in a manner that allows us to obtain sufficient and appropriate audit evidence for our opinion.
Our audit has been performed with a high, but not absolute, level of assurance, which means we may not detect all material misstatements, whether due to fraud or error during our audit.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. The materiality affects the nature, timing and extent of our audit procedures and the evaluation of the effect of identified misstatements on our opinion.
We have exercised professional judgment and have maintained professional skepticism throughout the audit, in accordance with Dutch Standards on Auditing, ethical requirements and independence requirements. The Information in support of our opinion section above includes an informative summary of our responsibilities and the work performed as the basis for our opinion. Our audit included among others:
- Identifying and assessing the risks of material misstatement of the financial statements, whether due to fraud or error, designing and performing audit procedures responsive to those risks, and obtaining audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control
- Obtaining an understanding of internal control relevant to the audit 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 company’s internal control
- Evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management
- Evaluating the overall presentation, structure and content of the financial statements, including the disclosures
- Evaluating whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation
We are responsible for planning and performing the group audit to obtain sufficient appropriate audit evidence regarding the financial information of the entities or business units within the group as a basis for forming an opinion on the financial statements. We are also responsible for the direction, supervision, review and evaluation of the audit work performed for purposes of the group audit. We bear the full responsibility for the auditor’s report.
Communication
We communicate with the supervisory board regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant findings in internal control that we identify during our audit.
Groningen, 2 November 2026
EY Accountants B.V.
signed by J.J. Kooistra