2007-08-06 09:56:47 CEST
2007-08-06 09:56:47 CEST
REGULATED INFORMATION
Orion - Half Year financial report
Orion Group Interim Report 1-6/2007
Operating profit at the same level as in the comparative period
Orion's net sales from the first two quarters of 2007 were EUR 345.8
(329.8) million, up by 4.9% compared to the same period last year.
* Operating profit was EUR 105.3 (105.8) million.
* Profit before taxes was EUR 106.1 (105.9) million.
* Equity ratio was 72.2% (72.8%).
* Return on capital employed (ROCE) was 50.3% (54.2%).
* Earnings per share were EUR 0.55 (0.56).
Orion's key figures for the review period*
Q2/07 Q2/06 Change Q1-Q2/07 Q1-Q2/06 Change 2006
EUR million Proforma % Proforma % Proforma
Net sales 166.6 156.3 +6.6% 345.8 329.8 +4.9% 641.1
Operating profit 44.3 42.9 +3.1% 105.3 105.8 -0.5% 196.7
(EBIT)
% of net sales 26.6% 27.5% 30.5% 32.1% 30.7%
Profit before taxes 44.3 42.6 +4.0% 106.1 105.9 +0.2% 197.3
% of net sales 26.6% 27.2% 30.7% 32.1% 30.8%
R&D expenses 25.5 20.0 +27.1% 47.1 41.1 +14.6% 84.1
% of net sales 15.3% 12.8% 13.6% 12.5% 13.1%
Capital expenditure 8.6 8.0 +7.1% 14.7 12.2 +20.6% 25.5
% of net sales 5.2% 5.1% 4.2% 3.7% 4.0%
Balance sheet total 526.3 517.9 +1.6% 588.1
Equity ratio, % 72.2% 72.8% 75.4%
Gearing, % -5.4% -5.1% -22.6%
Interest-bearing 20.3 10.5 +93.5% 9.8
liabilities
Non-interest-bearing 126.1 130.6 -3.5% 134.8
liabilities
Cash and 40.6 29.8 +36.2% 110.0
cash equivalents
ROCE (before taxes), 50.3% 54.2% 46.5%
%
ROE (after taxes), % 37.8% 40.6% 34.5%
Earnings per share, 0.23 0.23 +1.1% 0.55 0.56 -1.8% 1.03
EUR
Equity per share, 2.69 2.67 +0.8% 3.14
EUR
Personnel 3 254 3 178 +2.4% 3 061
at the end of the
period
* The proforma figures for periods before 1 July 2006 are based on
the comparable ones carved out from the financial statements of the
demerged Orion.
CEO Jukka Viinanen's review"Orion's net sales during the first half of the year increased by
about 5% compared to the same period last year. The sales of
entacapone products in Orion's own sales network grew by 11%, but
also the sales of generic prescription medicines, self-care products
and veterinary medicines developed positively. However, the Group's
operating profit did not improve due to planned investments in R&D as
well as sales and marketing. The increase of the R&D costs was due to
the entry of dexmedetomidine into Phase 3 and the new COMT inhibitor
candidate into Phase 1 in spring. Moreover, new product launches and
preparations for up-coming further launches during the latter half of
the year have increased the sales and marketing expenses. These
operations support Orion's strategy, which in the near-term focuses
on broadening our own sales network and increasing our presence in
Europe. In the long-term, Orion aims to develop and sell new
medicines that are based on in-house R&D.""Market sales of Orion's most important product, entacapone,
continued to develop favourably. Deliveries of Stalevo and Comtan to
the marketing partner Novartis grew less than the partner's own sales
and Orion's deliveries to Novartis in previous years. This is mainly
due to the timing of the partner's purchases.""Networking in the R&D operations continued in June when Orion signed
a partnership agreement with Medeia Therapeutics Ltd, a Finnish based
research company. In the beginning of the year, Orion established a
partnership with Aurigene Discovery Technologies, an Indian-based
company. These partnerships strongly support Orion's strategy and our
aims to strengthen our research portfolio through networking."
For further information, kindly contact:
Jukka Viinanen, CEO, tel. +358 10 426 3710
Jari Karlson, CFO, tel. +358 10 426 2883 or mobile +358 50 966 2883
www.orion.fi
www.orion.fi/investors
Press conference in Finnish, on-line webcasting
A press conference on the Q2/2007 results will be held today on
Monday, 6 August 2007, starting at 14.30 pm, at the Diana Auditorium
in Helsinki, address Erottajankatu 5. The language of the conference
is Finnish. The event can be followed on line through the Group's
Finnish homepage at www.orion.fi, as well as via the Kauppalehti Live
web service at www.kauppalehti.fi/live.
The on-demand video webcast of the Q2 presentations will be available
at www.orion.fi/investors (in English) and at
www.orion.fi/sijoittajille (in Finnish) later in the evening of 6
August 2007. The English webcast can also be accessed via
www.earnings.com or Thomson/CCBN's password-protected event
management site, StreetEvents at www.streetevents.com.
Conference call in English
A teleconference for questions and answers in English will be
arranged today on Monday, 6 August 2007, starting at 17.00 pm Finnish
time (15.00 pm GMT). Advice to participate the conference will be
provided on the front page of www.orion.fi/investors.
Orion's events during the end of the year
Interim Report 1-9/2007 Wednesday, 24
October 2007
Capital Markets Day in London Wednesday, 21
November 2007
Orion's financial reports and related presentation material are
available on the Group's home pages at www.orion.fi/investors
promptly after the publishing. The homepages also provide a
possibility to register on Orion's mailing lists for publications and
releases.
Financial performance in 1-6/2007
Net sales
The net sales of the Orion Group for the first two quarters in 2007
were EUR 345.8 (329.8) million, up by 4.9% from the comparative
period last year. The net impact of the currency exchange rates,
mainly the US dollar, was a negative EUR 4.4 million.
The net sales of the Pharmaceuticals business were EUR 324.7 (309.2)
million, up by 5.0%. The products based on in-house R&D accounted for
EUR 147.0 (143.9) million, or 45% (47%) of the business segment's
total. The medicines for Parkinson's Disease, i.e. Stalevo® and
Comtess®/Comtan®, contributed EUR 102.0 (94.9) million, or about 31%
(31%) of the total net sales of the business segment.
The net sales of the Diagnostics business were EUR 22.1 (21.6)
million, up by 2.1%. QuikRead® infection tests continued to show the
best growth. However, the decline in the sales of the older product
portfolio slowed down the total growth.
Operating profit
The Pharmaceuticals business generated an EBIT of EUR 106.3 (105.3)
million, up by 0.9%. The improvement in the gross margin was somewhat
lower than the net sales, because the products that are based on
in-house R&D, characterised by above-average margins, contributed
less to the total net sales than in the comparative period. The
expenses of selling and marketing as well as R&D were increased as
planned.
The Diagnostics business generated an EBIT of EUR 5.1 (4.5) million,
up by 13.0%. The improvement was a result of increased net sales, but
operating expenses remained at the same level as in the comparative
period.
Operating expenses
The consolidated operating expenses were EUR 134.8 (126.3) million,
up by 6.7% from the comparative period. Expenses of selling and
marketing increased by 5.1% to EUR 69.0 (65.7) million. The Group's
R&D expenses were EUR 47.1 (41.1) million, up by 14.6% and
representing 13.6% (12.5%) of the Group net sales. Pharmaceutical R&D
expenses were EUR 45.2 million, or about 96% of the total. The R&D
function is reported in the segment review of the Pharmaceuticals
business.
Profit before taxes
Group profit before taxes was EUR 106.1 (105.9) million. Earnings per
share were EUR 0.55 (0.56). Equity per share was EUR 2.69 (2.67).
Group ROCE before taxes was 50.3% (54.2%) and ROE after taxes was
37.8% (40.6%).
Balance Sheet and financial position
Gearing was -5.4% (-5.1%) and equity ratio was 72.2% (72.8%). Total
liabilities in the Balance Sheet of 30 June 2007 came to EUR 146.4
(141.1) million, of which interest-bearing liabilities accounted for
EUR 20.3 (10.5) million.
The Group's cash and cash equivalents were EUR 40.6 (29.8) million.
The cash reserves are invested in short-term interest instruments
issues by solid financial institutions and corporations.
Cash flows
The cash flow from operations was EUR 75.6 (59.8) million. Operating
profit was at the same level as in the comparative period, whereas
working capital was EUR 26.4 million less than in the comparative
period last year.
Cash flow from investments was EUR -13.5 (-11.0) million.
Cash flow from financing activities was EUR -131.8 (-143.5) million.
The cash flow improved slightly despite higher dividends than last
year. In addition to the dividend distribution, two significant
non-recurring items affected the cash flow of the comparative period.
These were the repayment of short-term loans to the companies which
in the demerger became members of Oriola-KD Corporation. On the other
hand, the share capital increase and share issue based on the
executed stock options in the comparative period had a positive
effect on the cash flow.
Capital expenditure
The capital expenditure of the Group was EUR 14.7 (12.2) million, of
which machinery and equipment accounted for EUR 9.7 (7.4) million.
Outlook
Outlook for 2007
Net sales will grow slightly from those of 2006. Sales of
pharmaceuticals via Orion's own sales network will grow moderately in
Finland and the markets outside Finland will continue showing growth.
In-market sales of the entacapone product franchise will continue
showing steady, although slower growth than in the previous years.
Deliveries to Novartis are anticipated to be at the same level as in
2006, in which they increased considerably, partly because of higher
reserve stockpile levels of Novartis.
Operating profit, excluding one-off earnings, is estimated to grow
slightly from 2006, despite increasing investments in marketing and
pharmaceutical research. Marketing expenses will grow especially due
to product launches by Orion's own European marketing units outside
Finland.
Research and development expenditure will be about EUR 95 million, of
which pharmaceutical R&D will account for about EUR 90 million. The
higher expenditure is mainly caused by the new clinical studies that
have been started in 2007.
Capital expenditure will be about EUR 35 million.
Preamble
The Finnish pharmaceutical market showed no growth in 2006 due to
Finnish authorities' actions to restrain the growth. On this account,
Orion's sales in Finland decreased last year. During the first half
of 2007, the Finnish market has started to show slight growth. In
addition, Orion's growth is boosted by new product launches. On the
other hand, heavy price competition especially in substitutable
prescription medicines is slowing down the total growth.
Novartis clearly piled up its stocks of entacapone products in 2006,
when Orion's deliveries to Novartis increased by over 40%, almost
twice as fast as the partner's own sales. This year Novartis has not
indicated to increase the stocks. Consequently, Orion's deliveries to
Novartis will remain at the level of 2006 despite the fact that
in-market sales of entacapone products will continue to grow well.
The highest expenses in pharmaceutical research are caused by the
clinical research phases. They are typically performed in clinics
that are located in several countries, and the costs are mainly
caused by the use of outsourced research services. R&D expenses also
vary considerably depending on the phase in which the research
programme is in. In the first half of 2007, Orion has started two
significant clinical studies, which are estimated to increase the R&D
expenses by about EUR 10 million from the previous year.
Short-term risks and uncertainties
Orion is not aware of any significant risks related to the near-term
outlook of the Group's financial performance.
Product and market specific sales revenues may vary a bit depending
on how the constantly tightened price and other competition in the
pharmaceutical markets affects especially Orion's products.
Deliveries of entacapone products to Novartis are based on schedules
agreed beforehand. Based on the schedules the sales for the rest of
the year can be predicted fairly accurately.
The development of the US dollar rate has only a minor effect on
Orion's results, as the great majority of the Group's total sales is
invoiced in euros.
Research projects always involve some uncertainties, which may
increase or decrease the estimated costs. Projects may proceed ahead
of schedule or lag behind it, or they might have to be discontinued.
Changes in the studies are reflected in the costs so slowly that they
do not have a significant effect on the estimated costs for the
ongoing financial year.
Strategy
In June, Orion's Board of Directors confirmed the Group's strategy
according to the same notions as last year. Orion's main aim is to
grow profitably and to increase shareholder value, but at the same
time manage the business risks. Operating in five business divisions
is seen to balance these risks. Orion continues to identify new
synergies and to strengthen the existing ones between the Proprietary
Products and The Specialty Products business divisions.
In the short-term, Orion strives to strengthen its current sales
network in Europe and to establish partnerships in countries where
the Group does not yet have own operations. Orion aims to broaden its
product portfolio through in-licensing and acquisitions of products,
product portfolios and companies. Orion also attempts to secure its
sales in Finland.
In the long-term, the best growth opportunity is in the Proprietary
Products business. The Group's R&D focus continues to be on the early
development. Partnerships are explored in clinical Phase 3 research,
especially when the aim is to receive marketing approvals in
countries outside Europe. Orion strives to broaden the R&D pipeline
through networking. Additionally, the life cycle management of
medicines that are based on in-house R&D is essential.
Financial objectives
The moderate organic growth of the net sales within the next few
years is accelerated via product, product portfolio and company
acquisitions. Operating profit will be increased and equity ratio is
maintained at the level of at least 50%.
Personnel
The average number of personnel in the Group in the first half of
2007 was 3,141 (3,058). In the end of June 2007, Orion had altogether
3,254 (3,178) employees, of which 2,918 persons were employed in
Finland and 336 persons were working in other countries.
The number of employees in the Pharmaceuticals business increased by
80 persons from June 2006, mainly in R&D, production and quality
control. The number of employees in the Diagnostics business remained
the same as in June 2006.
Shares, ownership base and dividends
The share capital of Orion Corporation is EUR 92.2 million. The total
number of shares is 141,257,828, of which 53,388,035 shares are in
Class A and 87,869,793 shares are in Class B at the time of
publishing this review. The counter book value of each share is EUR
0.65. Each Class A share provides 20 (twenty) votes and each Class B
share provides 1 (one) vote at the General Meetings of the
Shareholders. Both shares provide equal rights to the company's
assets and dividends.
Based on the Articles of Association, a shareholder can demand
conversion of his/her Class A shares into Class B shares. During the
second quarter of 2007, a total of 1,873,205 Class A shares were
converted into Class B shares. In addition 100,000 Class A shares
were converted during July 2007.
Orion's Board of Directors has been authorised by the Shareholders'
Meeting on 2 April 2007 to acquire and convey the company's own
shares, although so far the Board has not exercised this right.
Orion's Board of Directors has decided at its meeting on 6 August
2007 to exercise its right to acquire company shares for a total
amount of 350,000 Class B shares. A separate release regarding the
matter will be issued after publishing this review. The Board does
not have an existing authorisation to raise the share capital or to
issue a bond loan, convertible loan or stock options.
Ownership base
At the end of July 2007, Orion had altogether 36 293 shareholders, of
which 94.5% were private shareholders. Their holdings accounted for
about 46.1% of the total number of shares and 57.7% of the total
amount of votes. The number of nominee-registered shares was 37.6
million, representing 26.4% of the total number of shares and 5.8% of
the total number of votes. No treasury shares are in the possession
of the company.
No transactions exceeding the flagging limits set in the Finnish
Securities Market Act have been brought to the attention of the
company.
Dividend policy
In the dividend distribution Orion takes into account the
distributable funds as well as the medium-long and long-term needs of
capital expenditure and other financial needs required for the
achievement of the financial objectives.
Releases during the review period
In June, Orion entered a research collaboration agreement with Medeia
Therapeutics Ltd, Kuopio, Finland, with an aim to develop novel
medicinal approaches for the treatment of neurodegenerative
diseases.
In June, a marketing authorisation was received in the USA for
Divigel® (estradiol gel) for the treatment of moderate to severe hot
flashes associated with menopause.
In early June, an anti-obesity treatment for dogs was launched by
Orion in Finland. The product, Yarvitan®
(mitratapide), is originated by Janssen Animal Health.
Events after the review period
In July, the markets for Divigel® (estradiol gel) for were further
broadened as it received a marketing authorisation in Japan.
In early August, the US FDA approved a new, 200 mg dose strength of
Stalevo. The new higher dose provides greater dosing flexibility in
the treatment of Parkinson's Disease patients with Stalevo as an
additional option complementing the already available 50, 100 and 150
mg tablet strengths.
Review of the segments
Pharmaceuticals business
Market review
The most important single market for Orion is Finland. According to
the statistics collected by Finnish Pharmaceutical Data Ltd, the
Finnish wholesales of pharmaceuticals in the first half of 2007 rose
by 4.7% to EUR 895.7 (855.0) million. Self-care product sales grew by
about 15% from those of the comparative period.
Orion is strongly positioned as the leading marketer of
pharmaceuticals in Finland. In 1-6/2007, the wholesales of Orion's
products totalled EUR 81.0 (75.7) million. Orion's market share was
9.0% (8.9%), with which Orion was 1.5 percentage points ahead of the
second-largest marketer.
In the 12-month period up to March 2007, the US wholesales of
medicines for Parkinson's Disease, a core therapy area in Orion's
business, were USD 1,080 (880) million, about 23% more than in the
comparative 12-month period. In Europe, the five largest markets for
Parkinsons' Disease medicines include the UK, Germany, France, Italy
and Spain. In these markets, the combined total sales of Parkinson's
Disease medicines in the respective 12-month periods were EUR 760
(700) million, the average growth being about 8%.
Net sales and profit of the Pharmaceuticals business
The net sales of the Pharmaceuticals business in the first half of
2007 were EUR 324.7 (309.2) million, up by 5.0% from the comparative
period. Operating profit was at the level of the comparative period,
EUR 106.3 (105.3) million, and the EBIT margin was 32.7% (34.1%).
Orion's sales in the domestic pharmaceuticals market turned to
growth, and the net sales of the company's own marketing organisation
outside Finland continued to show growth. Germany and the UK, as well
as eastern Europe and Russia, the markets emphasised by the strategy
as primary geographic growth areas, continued to show especially
positive development. The net sales from partner sales developed at a
lower pace.
Proprietary Products
The combined net sales of Orion's proprietary products for
Parkinson's Disease, Stalevo® (levodopa, entacapone, carbidopa) and
Comtess®/Comtan® (entacapone) were EUR 102.0 (94.9) million, slightly
up from the comparative period and accounting for one-third of the
total net sales of the Pharmaceuticals business, as in the
comparative period too. The net sales from shipments of Stalevo and
Comtan to the marketing partner Novartis were EUR 61.3 (58.1)
million, 5.4% more than in the comparative period. The net sales
generated by Orion's own sales organisation from Stalevo and Comtess
were EUR 40.7 (36.8) million, up by 10.8%. The UK and Germany have
continued as the markets showing the strongest sales growth.
In early August, the US FDA approved a new, 200 mg dose strength of
Stalevo. The new higher dose provides greater dosing flexibility in
the treatment of Parkinson's Disease patients with Stalevo as an
additional option complementing the already available 50, 100 and 150
mg tablet strengths.
A marketing authorisation for Divigel® (estradiol gel) was received
in June for the USA and in July for Japan. The product is used for
the treatment of moderate to severe hot flashes associated with
menopause. The marketer of the product in the US is Upsher-Smith
Laboratories, Inc. and in Japan Pola Chemical Industries Inc.
Specialty Products
The Specialty Products business generated EUR 120.6 (110.8) million
in net sales for 1-6/2007, almost 9% up from the comparative period.
The domestic sales developed favourably, and new products were
launched.
The net sales from the Easyhaler franchise of asthma medicines
declined by 13.2% from the comparative period, which included
shipments to the stocks of marketing partners for launch purposes,
especially in the UK. The sales of Calcimagon®, marketed in Germany
for osteoporosis, showed strong growth in the first half of the year.
Animal Health
The net sales of the Animal Health business was EUR 36.2 (32.1)
million and it grew by 12.6% from the comparative period, thanks to
the continued favourable development of the sales by both Orion's own
Scandinavian marketing organisation and the partners. The unit
accounted for about 11% (10%) of the total net sales of the
Pharmaceuticals business. The animal sedatives Domitor®, Domosedan®
and Antisedan® went on showing growth, and their net sales increased
by 16.4%. These products accounted for about 44% (43%) of the total
net sales of the Animal Health business.
In early June, an antiobesity treatment for dogs was launched by
Orion in Finland. The product, Yarvitan®
(mitratapide), originated by Janssen Animal Health, is the first of
its kind in Finland.
The sales network is being expanded into the eastern European
markets, in line with Orion's strategy. In the second quarter,
operations were started up in the Czech Republic, Hungary and Poland.
Fermion
Fermion, which manufactures active pharmaceutical ingredients,
generated EUR 20.8 (22.1) million in net sales from Group-external
operations, down by 6.1% from the comparative period. The impact of
intra-Group transactions, i.e. supply to Orion's own use, has been
eliminated from the figures.
10 best-selling pharma brands
The net sales from the ten best-selling pharmaceutical brands of
Orion increased by 7.0% and they accounted for about 51% (50%) of the
total net sales of the Pharmaceuticals business. The purchases by
pharmacies of Burana® (ibuprofen) have returned to the long-term
average levels since the downswing experienced in the previous year
due to a change in the Finnish pharmaceuticals act.
Marevan® (varfarine), which rose into the group of the ten
best-sellers for the review period, is an anticoagulant whose sales
growth is coming from the eastern European territories especially.
Also other old products are generating increased sales along with the
expanding coverage of Orion's sales organisation.
Proprietary products franchise
The net sales from the proprietary products franchise were EUR 147.0
(143.9) million, up by 2.2% from the comparative period and
accounting for 45% (47%) of the total net sales of the
Pharmaceuticals business. Stalevo and the animal sedatives were the
products showing growth.
Pharmaceutical research and development
Pharmaceutical research and development expenses were EUR 45.2 (39.1)
million, representing 13.9% (12.7%) of the net sales of the
Pharmaceuticals business. In accordance with its strategy, Orion aims
to allocate its R&D resources in such a way that the best possible
support is given to both the proprietary and generic prescription
drugs businesses.
The largest on-going study is STRIDE-PD, a major Phase 3 study on
Parkinson's Disease, seeking to investigate if Stalevo medication can
delay the onset of motor complications, i.e. dyskinesias, compared
with conventional levodopa/carbidopa medication. The study has been
under way since late 2004, and it is being carried out in
collaboration with Novartis in 14 countries. It involves 747
patients, each being treated for almost three years. The timeline for
the collection of patient treatment data has been extended to ensure
the adequate statistical coverage. The results from the research
program are expected at the turn of 2008-2009.
The clinical Phase 3 studies have started in May with dexmedetomidine
(Precedex®) in patients in intensive care as an infusion administered
for over 24 hours. The objective of the program is to have the
product registered in the EU. The product is already available in the
USA and Japan as a sedative for patients in intensive care,
administrable for up to 24 hours. The current Phase 3 program
consists of two studies, in which dexmedetomidine is compared with
midazolam and propofol. Both arms are planned to involve 500 patients
and they are estimated to be completed in about two years.
A research programme is under way in clinical Phase 1 for the
development of a new, more efficient COMT inhibitor than entacapone.
The LEVET programme, which is studying the efficacy of levosimendan
in the treatment of heart diseases in dogs, is progressing to the
last research phase with an aim to receive marketing authorisations.
Recruitment is being started in the European arm of the programme.
In early research phases, Orion is investigating molecules affecting
alpha 2 receptors in the central nervous system, and selective
androgen receptor modulators (SARM), among others.
In June, Orion entered into a research and option agreement with
Medeia Therapeutics Ltd. with an aim to develop new types of
medicinal substances for neurodegenerative diseases. In the research
collaboration, Medeia engages in the discovery and early non-clinical
development. Orion will take charge of the non-clinical and
pharmaceutical development of the chosen drug candidate starting from
the first clinical research phase.
Diagnostics business
Orion Diagnostica continued to show positive performance. The net
sales were EUR 22.1 (21.6) million, up by 2.1% from the comparative
period. QuikRead® tests, which are used for the detection of
infections on the basis of the CRP content in a blood sample,
remained as the main driver for the sales. The sales of Uricult®, a
test for the detection of urinary tract infections, developed
favourably during the period as well.
Steady growth continued in the sales of the own sales organisation
covering the Nordic countries. In the export markets, the best growth
percentages were achieved in China, Germany, Czech and Spain.
Operating profit was EUR 5.1 (4.5) million, up by 13.0% from the
comparative period. EBIT was 23%. The good performance is mainly
consequence of the strong focus of the sales efforts on the most
profitable products.
Espoo, 6 August 2007
Board of Directors of Orion Corporation
Orion Corporation
Jukka Viinanen Jari Karlson
President and CEO CFO
Tables
Group Income statement
Financial
Q2/07 Q2/06 Change Q1- Q1-Q2/06 Change 2006 period
EUR million Proforma % Q2/07 Proforma % Proforma Q3-Q4/06
Net sales 166.6 156.3 +6.6% 345.8 329.8 +4.9% 641.1 311.2
Cost of goods
sold -53.1 -50.2 +5.7% -107.1 -99.9 +7.2% -205.2 -105.2
Gross profit 113.5 106.0 +7.1% 238.7 229.9 +3.9% 435.8 205.9
Other
operating
income 0.6 0.7 -8.9% 1.3 2.2 -39.7% 13.8 11.6
Selling and
marketing
expenses -35.4 -33.3 +6.3% -69.0 -65.7 +5.1% -128.9 -63.2
R&D expenses -25.5 -20.0 +27.1% -47.1 -41.1 +14.6% -84.1 -43.1
Administrative
expenses -9.1 -10.5 -13.4% -18.7 -19.5 -4.3% -39.9 -20.4
Operating
profit 44.3 42.9 +3.1% 105.3 105.8 -0.5% 196.7 90.9
Financial
income 0.6 0.5 +20.1% 1.9 1.8 +8.5% 3.5 1.8
Financial
expenses -0.6 -0.9 -30.4% -1.1 -1.7 -34.1% -3.0 -1.2
Profit before
taxes 44.3 42.6 +4.0% 106.1 105.9 +0.2% 197.3 91.4
Income tax
expense -11.9 -10.7 +11.2% -28.2 -27.4 +3.2% -52.2 -24.8
Profit
for the period 32.3 31.8 +1.6% 77.9 78.5 -0.8% 145.1 66.6
of which attributable to:
Parent company
shareholders 32.3 31.8 +1.6% 77.9 78.5 -0.8% 145.1 66.6
Minority
interest 0.0 0.0 0.0 0.0 0.0 0.0
Earnings
per share,
EUR* 0.23 0.23 +1.1% 0.55 0.56 -1.8% 1.03 0.47
Depreciation
and
amortisation 7.7 8.7 -12.2% 16.2 17.5 -7.6% 34.7 17.2
Personnel
expenses 40.0 37.7 +6.0% 76.1 72.4 +5.0% 145.8 73.3
* The figure has been calculated from the profit attributable to the
parent companies shareholders.
Balance sheet
Assets:
6/07 6/06 Change 12/06
EUR million Proforma %
Non-current assets:
Property, plant and equipment 185.3 191.2 -3.1% 187.1
Goodwill 13.5 13.5 - 13.5
Other intangible assets 21.7 23.7 -8.2% 21.9
Investments in associates 0.1 0.1 - 0.1
Available-for-sale investments 1.0 1.0 -3.5% 1.0
Pension asset 55.2 49.2 +12.3% 52.7
Deferred tax assets 1.3 1.7 -23.9% 1.4
Other non-current assets 2.3 4.3 -46.1% 3.8
Non-current assets total 280.4 284.6 -1.5% 281.4
Current assets:
Inventories 107.4 110.4 -2.7% 107.2
Trade receivables 84.6 75.4 +12.2% 75.0
Other receivables 13.3 17.7 -25.1% 14.4
Cash and cash equivalents 40.6 29.8 +36.2% 110.0
Current assets total 245.9 233.3 +5.4% 306.6
Assets total 526.3 517.9 +1.6% 588.1
Equity and liabilities:
6/07 6/06 Change 12/06
EUR million Proforma %
Equity:
Share capital 92.2 92.2 - 92.2
Share issue 17.8 17.8 - 17.8
Share premium 23.0 23.0 - 23.0
Expendable fund 0.4 0.5 -4.2% 0.5
Retained earnings 246.4 243.2 +1.3% 309.9
Equity of the parent company
shareholders 379.9 376.8 +0.8% 443.5
Minority interest 0.0 0.0 - 0.0
Equity total 379.9 376.8 +0.8% 443.5
Non-current liabilities:
Deferred tax liabilities 49.9 53.2 -6.2% 51.5
Pension liability 1.0 0.8 +18.5% 0.9
Provisions 0.2 1.4 -83.4% 0.6
Interest-bearing non-current liabilities 7.5 7.9 -6.1% 7.5
Other non-current liabilities 0.2 1.4 -87.2% 1.8
Non-current liabilities total 58.8 64.8 -9.3% 62.3
Current liabilities:
Trade payables 26.5 21.9 +21.0% 29.2
Other current liabilities 48.1 51.5 -6.7% 49.9
Provisions 0.2 0.3 -46.3% 0.9
Interest-bearing current liabilities 12.8 2.5 +403.7% 2.3
Current liabilities total 87.6 76.3 +14.8% 82.3
Equity and liabilities total 526.3 517.9 +1.6% 588.1
Consolidated statement of changes in equity
Change Equity
in of the
trans- parent
Share Expend- Other lation Retained company Minor-
Share pre- able reser- differ- earn- share- ity In
EUR million capital mium funds ves ences ings holders interest total
Equity on
1 Jul 06 92.2 17.8 23.0 0.5 -3.5 246.8 376.8 0.0 376.8
Change in
translation
differences 0.1 0.1 0.1
Profit
for the
period 66.6 66.6 -0.0 66.6
Recognised
income
and
expenses
in total 0.1 66.6 66.7 -0.0 66.7
Other
changes -0.0 -0.0 -0.0
Equity on
1 Jan 07 92.2 17.8 23.0 0.5 -3.4 313.3 443.5 0.0 443.5
Change in
translation
differences -0.1 -0.1 -0.1
Profit
for the
period 77.9 77.9 0.0 77.9
Recognised
income
and
expenses
in total -0.1 77.9 77.7 0.0 77.7
Dividend -141.3 -141.3 -141.3
Other
changes -0.0 -0.0 -0.0 -0.0 -0.0
Equity on
30 Jun 07 92.2 17.8 23.0 0.4 -3.5 249.9 379.9 0.0 379.9
Cash flow statement
Financial
Q1-Q2/07 Q1-Q2/06 2006 period
EUR million Proforma Proforma Q3-Q4/06
Cash flow from operating activities:
Operating profit 105.3 105.8 196.7 90.9
Adjustments
Depreciation and
amortisation 16.2 17.5 34.7 17.2
Sales gains and losses and
disposals of property,
plant and equipment 0.0 0.1 -9.8 -9.8
Unrealised foreign exchange
gains and losses -0.4 -1.1 -0.4 0.7
Change in pension asset and
pension obligation -2.4 -2.8 -6.3 -3.5
Change in provisions -1.1 -0.9 -1.2 -0.2
Other adjustments 0.0 -1.1 -1.1 0.0
12.2 11.7 16.0 4.3
Change in working capital:
Change in
non-interest-bearing current
receivables -9.1 -6.8 -2.4 4.4
Change in inventories -0.2 -10.6 -7.5 3.2
Change in
non-interest-bearing current
liabilities -5.6 -23.7 -8.7 14.9
-14.8 -41.2 -18.6 22.5
Interest paid -0.9 -2.2 -3.8 -1.5
Interest received 2.0 1.8 3.5 1.7
Income taxes paid -28.2 -16.2 -52.5 -36.3
Net cash from operating
activities 75.6 59.8 141.4 81.6
Cash flow from investing activities:
Purchases of property, plant,
equipment
and intangible assets -13.9 -10.5 -22.8 -12.3
Acquisition of subsidiary, net
of cash - -1.2 -1.2 -
Proceeds from sale of property,
plant, equipment,
intangible assets and
available-for-sale investments 0.5 0.7 13.0 12.3
Net cash used in investing
activities -13.5 -11.0 -10.9 0.0
Cash flow from financing activities:
Share issue and share capital
increase
based on the use of stock
options - 21.4 21.4 -
Change in short-term loans 10.0 -46.5 -47.5 -1.0
Repayments of long-term loans -0.4 -0.2 -0.6 -0.4
Dividends paid -141.4 -118.2 -118.2 0.0
Net cash used in financing
activities -131.8 -143.5 -144.9 -1.4
Net change in cash and cash
equivalents -69.6 -94.6 -14.4 80.2
Cash and cash equivalents
at the beginning of the period 110.0 124.5 124.5 29.8
Foreign exchange adjustments 0.2 0.0 -0.1 0.0
Net change in cash and cash
equivalents -69.6 -94.6 -14.4 80.2
Cash and cash equivalents at the
end of the period 40.6 29.8 110.0 110.0
Changes in property, plant and equipment
Financial
Q1-Q2/07 Q1-Q2/06 2006 period
EUR million Proforma Proforma Q3-Q4/06
Carrying amount at the beginning 187.1 196.4 196.4 191.2
of the period
Additions 11.3 8.4 19.0 10.5
Disposals -0.6 -0.7 -2.7 -1.9
Depreciation -12.5 -12.9 -25.6 -12.7
Carrying amount at the end of 185.3 191.2 187.1 187.1
the period
Commitments and contingencies
6/07 6/06 12/06
EUR million Proforma
Contingent for own liabilities:
Mortgages on land and buildings 25.5 27.9 25.5
of which those to the Orion 11.4 9.0
Pension Fund 9.0
Guarantees 1.5 1.9 1.8
Contingent for liabilities of other parties:
Mortgages on land and buildings - 9.5 -
Guarantees - 7.1 -
Other liabilities:
Leasing liabilities (excl. finance leasing
contracts) 4.7 3.8 5.2
Other liabilities 0.3 0.3 0.3
Derivates
6/07 6/06 12/06
EUR million Proforma
Currency forward contracts:
- fair value 0.5 0.7 0.3
- nominal value 74.4 75.6 58.5
Related party transactions
Financial
Q1-Q2/07 Q1-Q2/06 2006 period
EUR million Proforma Proforma Q3-Q4/06
Management benefits 1.8 1.2 2.1 1.0
Non-current liabilities to the 6.0 6.0 6.0 6.0
pension fund
at the end of the period
Performance by segment
Net sales by business segment
Financial
Q2/07 Q2/06 Change Q1-Q2/06 Change 2006 period
EUR million Proforma % Q1-Q2/07 Proforma % Proforma Q3-Q4/06
Pharmaceuticals 156.8 146.4 +7.1% 324.7 309.2 +5.0% 601.4 292.0
Diagnostics 10.3 10.4 -1.0% 22.1 21.6 +2.1% 41.5 19.9
Group items -0.5 -0.5 -11.9% -1.0 -1.1 -8.0% -1.8 -0.7
Group total 166.6 156.3 +6.6% 345.8 329.8 +4.9% 641.1 311.2
Operating profit by business segment
Financial
Q2/07 Q2/06 Change Q1-Q2/06 Change 2006 period
EUR million Proforma % Q1-Q2/07 Proforma % Proforma Q3-Q4/06
Pharmaceuticals 45.6 43.3 +5.2% 106.3 105.3 +0.9% 189.9 84.6
Diagnostics 1.8 1.7 +10.1% 5.1 4.5 +13.0% 6.6 2.1
Group items -3.2 -2.1 +54.3% -6.0 -4.0 +50.6% 0.2 4.2
Group total 44.3 42.9 +3.1% 105.3 105.8 -0.5% 196.7 90.9
Net sales by annual quarters
Q2/07 Q1/07 Q4/06 Q3/06 Q2/06 Q1/06
EUR million Proforma Proforma
Pharmaceuticals 156.8 167.9 152.1 139.9 146.4 162.9
Diagnostics 10.3 11.8 10.4 9.5 10.4 11.2
Group items -0.5 -0.5 -0.4 -0.4 -0.5 -0.5
Group total 166.6 179.2 162.2 149.0 156.3 173.5
Operating profit by annual quarters
Q2/07 Q1/07 Q4/06 Q3/06 Q2/06 Q1/06
EUR million Proforma Proforma
Pharmaceuticals 45.6 60.7 39.5 45.1 43.3 62.0
Diagnostics 1.8 3.2 0.6 1.5 1.7 2.8
Group items -3.2 -2.9 -3.5 7.7 -2.1 -1.9
Group total 44.3 61.1 36.6 54.3 42.9 62.9
Geographical breakdown of net sales by annual quarters
Q2/07 Q1/07 Q4/06 Q3/06 Q2/06 Q1/06
EUR million Proforma Proforma
Finland 48.6 50.1 49.0 45.2 45.4 44.8
Scandinavia 25.3 24.1 23.4 21.2 24.2 22.5
Other Europe 57.5 63.7 58.4 52.8 52.7 69.6
North America 20.1 24.1 22.0 20.1 20.5 20.4
Other markets 15.1 17.1 9.4 9.7 13.4 16.2
Group total 166.6 179.2 162.2 149.0 156.3 173.5
Review of the segments
Pharmaceuticals
Key figures
Financial
Q2/07 Q2/06 Change Q1-Q2/06 Change 2006 period
EUR million Proforma % Q1-Q2/07 Proforma % Proforma Q3-Q4/06
Net sales 156.8 146.4 +7.1% 324.7 309.2 +5.0% 601.4 292.0
Operating
profit 45.6 43.3 +5.2% 106.3 105.3 +0.9% 189.9 84.6
% of net
sales 29.1% 29.6% 32.7% 34.1% 31.6% 29.0%
Capital
expenditure 7.9 7.5 +4.7% 13.5 11.3 +20.0% 23.1 11.8
Net sales
from
own
proprietary
products 70.1 63.4 +10.6% 147.0 143.9 +2.2% 274.9 131.0
R&D
expenses 24.5 19.0 +29.2% 45.2 39.1 +15.6% 79.7 40.6
Personnel
at the
end of the
period 2 926 2 846 +2.8% 2 742 2 742
Breakdown of pharmaceuticals net sales by business areas
Q2/07 Q2/06 Change Q1-Q2/06 Change 2006
EUR million Proforma % Q1-Q2/07 Proforma % Proforma
Proprietary 256.6
Products 63.7 55.7 +14.3% 135.0 132.7 +1.7%
Specialty 218.7
Products 58.9 55.6 +5.9% 120.6 110.8 +8.9%
Animal Health 18.6 16.7 +11.6% 36.2 32.1 +12.6% 63.3
Fermion 9.7 9.9 -1.9% 20.8 22.1 -6.1% 38.5
Other
pharmaceutical
business 5.9 8.4 -30.4% 12.1 11.5 +5.9% 24.2
Group total 156.8 146.4 +7.1% 324.7 309.2 +5.0% 601.4
Net sales of Orion's 10 Best-selling medicinals
Q2/07 Q2/06 Change Q1-Q2/06 Change 2006
EUR million Proforma % Q1-Q2/07 Proforma % Proforma
Stalevo
(Parkinson's
disease) 28.6 23.1 +23.8% 61.7 55.2 +11.7% 111.3
Comtess/Comtan
(Parkinson's
disease) 18.8 17.6 +6.8% 40.3 39.7 +1.6% 74.7
Domitor,
Domosedan and
Antisedan
(animal
sedatives) 8.1 6.8 +19.0% 16.0 13.7 +16.4% 26.0
Calcimagon
(osteoporosis) 4.6 2.5 +79.4% 7.9 6.1 +29.5% 11.7
Burana
(inflammatory
pain) 3.6 3.0 +22.8% 7.7 5.2 +47.7% 12.0
Easyhaler
(asthma) 3.9 4.0 -3.4% 7.6 8.8 -13.2% 15.9
Divina-series
(menopausal
symptoms) 3.7 4.1 -11.0% 7.3 8.1 -9.6% 16.2
Simdax (heart
failure) 3.1 3.4 -6.2% 6.6 7.6 -12.8% 13.2
Enanton
(prostate
cancer) 3.2 3.3 -2.7% 6.5 6.8 -3.3% 13.3
Marevan
(anticoagulant) 2.3 2.0 +18.5% 4.2 3.9 +9.0% 7.0
In total 79.9 69.8 +14.6% 165.9 155.1 +7.0% 301.2
Share of total
pharmaceutical
net sales 51% 48% 51% 50% 50%
Diagnostics business
Key figures
Financial
Q2/07 Q2/06 Change Q1-Q2/07 Q1-Q2/06 Change 2006 period
EUR million Proforma % Proforma % Proforma Q3-Q4/06
Net sales 10.3 10.4 -1.0% 22.1 21.6 +2.1% 41.5 19.9
Operating
profit 1.8 1.7 +10.1% 5.1 4.5 +13.0% 6.6 2.1
% of net
sales 17.7% 15.9% 23.0% 20.8% 15.9% 10.6%
Capital
expenditure 0.3 0.4 -35.9% 0.4 0.7 -40.2% 1.4 0.8
Personnel
at the end
of the
period 294 294 +0.2% 289 289
Information on Orion Corporation's shares on 30 June2007
Class A Class B A and B in
total
Share EUR EUR EUR
capital 36.1 million 56.1 million 92.2 million
Total
number of
shares 53 488 035 pcs 87 769 793 pcs 141 257 828 pcs
Minimum
share EUR
capital - - 50 million
Maximum
share EUR
capital - - 2 000 million
Share of
total share
stock 38 % 62 % 100 %
Counter
book value
of share 0.65 EUR 0.65 EUR -
Votes per
share 20 votes 1 vote
Trading
code on the
Helsinki
Stock
Exchange ORNAV ORNBV
Both share classes provide equal rights to the company assets and
dividends.
trading in Orion's A and b shares during 1 janury-30 june 2007
Class A Class B A and B in total
Total number 2 137 56 178
of shares traded 925 pcs 149 pcs 58 316 074 pcs
Share of total
share stock 4.0 % 64.5 % 41.3 %
Lowest quotation 15.07 EUR 15.96 EUR
Highest quotation 19.19 EUR 19.19 EUR
Closing quotation
on 2 January 2007 16.50 EUR 16.50 EUR
Closing quotation
on 30 June 2007 18.52 EUR 18.54 EUR
Market
capitalisation EUR EUR EUR
on 30 June 2007 990.6 million 1 627.3 million 2 617.9 million
PErformance per share
Financial
Q2/07 Q2/06 Change Q1-Q2/06 Change 2006 period
Proforma % Q1-Q2/07 Proforma % Proforma Q3-Q4/06
Earnings 0.23 0.23 +1.1% 0.55 0.56 -1.8% 1.03 0.47
per
share,
EUR
Equity 2.69 2.67 +0.8% 3.14 3.14
per
share,
EUR
Average 141 258 140 594 141 258 139 852 140 561 141 258
number
of
shares,
1 000
pcs
Appendices
Orion Group structure
Orion Corporation was established on 1 July 2006 as one of the two
new listed companies that resulted from the demerger of the former
Orion. The parent company of the Orion Group, Orion Corporation
consists of two businesses and five business divisions:
* Pharmaceuticals
o Proprietary Products (patented prescription products)
o Specialty Products (off-patent prescription products and
self-medication products)
o Animal Health
o Fermion (active pharmaceutical ingredients)
* Diagnostics
o Orion Diagnostica.
Accounting principles
This interim report has been prepared in accordance with the
accounting policies set out in International Accounting Standard 34
on Interim Financial Reporting and in the Group's Financial Statement
for 2006, with the exception of the following new IFRS-standards and
IFRIC-interpretations as of 1 January 2007
* IFRS 7 Financial Instruments: Disclosures
* IAS 1 amendment to standard, Presentation of Financial
Statements: Capital Disclosures
* IFRIC 9 Re-assessment of Embedded Derivatives
* IFRIC 10 Interim Financial Reporting and Impairment
These new standards, amendments to standards and interpretations do
not have a substantial effect on the Group's interim report nor
reported figures.
The principles and calculation methods are available on the Group's
homepage at www.orion.fi/english/investors.
The figures have not been audited. Those in the parentheses are for
the comparative period of the previous year. The per-share ratios
have been adjusted.
The figures have been rounded. Therefore, the total sums of
individual figures may differ from the total sums shown.
Calculation of the key figures
Return on capital Profit before taxes + interest and
employed (ROCE), % = other financial expenses x 100
Total assets - non-interest-bearing
liabilities (annual average)
Profit for the period
Return on equity (ROE), = Equity of the parent company x 100
% shareholders + minority interest
(annual average)
Equity ratio, % = Equity of the parent company x 100
shareholders + minority interest
Total assets - advances received
Interest-bearing liabilities - Cash
Gearing, % = and cash equivalent x 100
Equity of the parent company
shareholders + minority interest
Earning per share, EUR Profit available for the parent
= company shareholders
Average number of shares
Equity of the parent company
Equity per share, EUR = shareholders
Number of shares at the end of the
period
Market capitalisation, Number of shares Closing
EUR million = at the end of the x quotation of the
period period
Distribution:
Helsinki Stock Exchange
Respective media
Publisher:
Orion Corporation
Orionintie 1A, 02 200 Espoo, FINLAND
www.orion.fi
Orion is a European pharmaceutical and diagnostics company which
emphasises the development of innovative medical treatments and
diagnostic tests for global markets. Orion develops, manufactures and
markets pharmaceuticals for humans and animals, active pharmaceutical
ingredients as well as diagnostic tests. Orion's clientele consists
mainly of healthcare service providers and professionals. Group's net
sales in 2006 (proforma) were EUR 641.1 million and in the end of
2006 there were 3 061 employees working for the company. Orion's
stocks are listed in Helsinki Stock Exchange. In 2007, Orion
celebrates its 90-year-history.
© 2024 Nasdaq, Inc. All Rights Reserved |