1. Principles of Combined Group Accounting

The BLG Group (BLG LOGISTICS) is headed by BREMER LAGERHAUS-GESELLSCHAFT -Aktiengesellschaft von 1877-, Bremen (BLG AG), and BLG LOGISTICS GROUP AG & Co. KG, Bremen (BLG KG), two companies that are legally, commercially and organizationally closely affiliated due to their identical governing bodies and special ownership structure. As BLG AG does not consider control over BLG KG to exist within the meaning of IFRS 10, it prepares combined financial statements for the Group together with BLG KG under the name BLG LOGISTICS with BLG AG and BLG KG as joint parent.

The combined financial statements for BLG LOGISTICS for the 2023 financial year were prepared in accordance with the International Financial Reporting Standards (IFRSs) adopted and published by the International Accounting Standards Board (IASB) mandatory as of December 31, 2023 and their interpretations by the IFRS Interpretations Committee (IFRIC). All IFRSs and IFRICs were observed that have been published and adopted in the endorsement process of the European Union and whose application is mandatory.

The accounting policies were applied consistently by all Group companies for all periods specified in the combined financial statements.

The financial year of BLG AG and BLG KG and of their consolidated subsidiaries is the calendar year. The reporting date of the combined financial statements is the closing date of the preparing entities.

The companies BLG AG (HRB 4413) and BLG KG (HRA 21448), which are entered in the Commercial Register of the District Court of Bremen, have their registered office at Präsident-Kennedy-Platz 1, Bremen, Germany.

The combined financial statements were prepared in euros. All amounts are in EUR thousand unless otherwise indicated.

The combined financial statements were prepared on the basis of historical cost accounting; exceptions arise only for derivative financial instruments and financial instruments classified as “measured at fair value through profit or loss or through other comprehensive income”.

The Board of Management of BLG AG released the combined financial statements for publishing and forwarding to the Supervisory Board on March 28, 2024. The Supervisory Board has the task of reviewing the combined financial statements and stating whether it approves them.

Judgments and estimates

The preparation of the financial statements in compliance with IFRSs requires estimates and the exercise of discretion in individual matters by management that may have an impact on the amounts reported in the combined financial statements.

Judgments

Information on judgments in applying the accounting policies that have the greatest material effect on the amounts reported in the combined financial statements is included in the following notes:

• Determining whether control exists (notes 38 and 39)
• Classification of joint arrangements (notes 15 and 39)
• Presentation of factoring (note 32)

Assumptions and estimation uncertainties

The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year relate in particular to the following notes:

• Calculation of useful lives of property, plant and equipment and intangible assets and costs of demolition obligations for property, plant and equipment (notes 12 and 13)
• Impairment testing of assets and measurement of goodwill (note 12)
• Estimations to determine the duration and expected payments for residual value guarantees as well as lease interest rates (note 14)
• Recognition of deferred tax assets (note 33)
• Estimation of parameters for impairment of property, plant and equipment, intangible assets, right-of-use assets and financial assets (notes 4, 12, 14, 16 and 18)
• Material actuarial assumptions (note 26)
• Discretion in measuring provisions and contingent liabilities (notes 24 and 29)

The estimates made were largely based on historical data and other relevant factors, including the going concern principle. Actual results may differ from these estimates.

Determination of fair values

The financial instruments of the Group accounted for at fair value are allocated to different levels of the fair value hierarchy based on the measurement method used; these levels are defined as follows:

• Level 1: Listed (unadjusted) prices in active markets for identical assets and liabilities
• Level 2: Techniques for which all inputs which have a material effect on the recognized fair value are either directly or indirectly observable
• Level 3: Techniques using inputs that have a material effect on the recognized fair value and are not based on observable market data

More information on the assumptions made in determining the fair values can be found in note 32.

Changes in accounting policies

The accounting policies applied were essentially unchanged compared with the policies applied in the previous year. In addition, the Group applied the following new/revised standards and interpretations that are relevant to BLG LOGISTICS and whose application was mandatory for the first time in the 2023 financial year:

Effects of changes in accounting policies

The new/revised standards had no material impact. For this reason, the amounts from the previous year have not been restated.

Non-mandatory application of new or amended standards and interpretations

Application of the standards and interpretations in the table which were previously adopted, revised or recently issued by the IASB was not yet mandatory in the 2023 financial year.

BLG LOGISTICS plans to observe the new standards and interpretations in the combined financial statements from the date on which their initial application becomes mandatory. The new standards and interpretations that are relevant to the Group’s operations will have an impact on the way in which the Group’s financial information is published; however, they will not have any material effects on the recognition and the measurement of assets and liabilities or the presentation of the financial performance in the combined financial statements.