2009-10-26 11:01:14 CET
2009-10-26 11:02:29 CET
REGULATED INFORMATION
Orion - Interim report (Q1 and Q3)
Orion Group Interim Report January-September 2009
ORION CORPORATION INTERIM REPORT JANUARY-SEPTEMBER 2009 26 OCTOBER
at 12:00 EET
Orion's net sales for January-September 2009 totalled EUR 578.2
million (EUR 530.9 million for January-September 2008), up by 8.9% on
the comparative period.
* Operating profit was EUR 163.1 (152.2) million.
* Profit before taxes was EUR 160.6 (152.0) million.
* Equity ratio was 57.6% (65.5%).
* ROCE before taxes was 39.6% (44.8%).
* ROE after taxes was 38.4% (35.9%).
* Earnings per share were EUR 0.84 (0.79).
* Cash flow per share before financial items was EUR 0.69 (0.43).
ORION'S KEY FIGURES FOR THE REVIEW PERIOD
Change Change
Q3/09 Q3/08 % Q1-Q3/09 Q1-Q3/08 % 2008
Net sales, EUR
million 191.8 170.1 +12.8% 578.2 530.9 +8.9% 710.7
International
operations, EUR
million 136.2 117.3 +16.1% 414.1 368.9 +12.3% 493.6
% of net sales 71.0% 69.0% 71.6% 69.5% 69.4%
Operating profit,
EUR million 55.7 43.6 +27.9% 163.1 152.2 +7.1% 185.0
% of net sales 29.0% 25.6% 28.2% 28.7% 26.0%
Profit before taxes,
EUR million 54.9 43.1 +27.6% 160.6 152.0 +5.6% 184.2
% of net sales 28.6% 25.3% 27.8% 28.6% 25.9%
Income tax expense,
EUR million 14.6 11.3 +29.0% 42.2 40.4 +4.5% 47.8
R&D expenses, EUR
million 20.5 20.3 +0.8% 69.6 64.5 +7.9% 90.0
% of net sales 10.7% 11.9% 12.0% 12.1% 12.7%
Capital expenditure,
EUR million 11.2 12.7 -11.9% 51.2 44.0 +16.3% 56.8
% of net sales 5.8% 7.5% 8.9% 8.3% 8.0%
Assets total, EUR
million 701.6 606.5 +15.7% 695.5
Equity ratio,% 57.6% 65.5% 60.2%
Gearing,% 1.6% 0.2% -7.1%
Interest-bearing
liabilities, EUR
million 158.2 95.9 +64.9% 146.3
Non-interest-bearing
liabilities, EUR
million 139.1 113.5 +22.5% 130.6
Cash and cash
equivalents, EUR
million 151.5 95.1 +59.3% 176.1
ROCE (before
taxes),% 39.6% 44.8% 38.5%
ROE (after taxes),% 38.4% 35.9% 32.1%
Earnings per share,
EUR 0.29 0.23 +27.0% 0.84 0.79 +6.1% 0.97
Cash flow per share
before financial
items, EUR 0.33 0.18 +89.4% 0.69 0.43 +61.6% 0.66
Equity per share,
EUR 2.87 2.82 +1.8% 2.97
Personnel at the end
of the period 3 125 3 300 -5.3% 3 309
Average personnel
during the period 3 210 3 255 -1.4% 3 270
Personnel expenses,
EUR million 123.9 120.1 +3.2% 170.9
The Orion Group changed its accounting policy regarding product
development costs as of 1 January 2009. Costs relating to the support
of products already on the market (mainly generic products) are now
recognised in cost of goods sold instead of R&D expenses in the
Statement of Comprehensive Income. This change has no effect on
reported key figures, operating profit and Statement of Financial
Position, but it reduces the R&D expenses previously reported for
2008 by EUR 13.4 million and correspondingly increases the cost of
goods sold.
On 1 January 2009, the Easyhaler® business was transferred from the
Specialty Products to the Proprietary Products division. At the same
time, hormone replacement products, such as the Divina® range, and
toremifene products, such as Fareston®, were transferred to Specialty
Products.
The key figures for comparative periods have been adjusted in
accordance with these reporting changes. In addition, the adjusted
key figures for previous periods are presented in the table "Adjusted
Key Figures" at the end of this report.
CEO Timo Lappalainen's review"Strong growth in business""Orion's net sales for the first nine months grew well to about nine
per cent higher than in the comparative period last year. Orion's
products based on in-house R&D were most successful. Deliveries of
the Parkinson's disease drugs Stalevo and Comtan to Novartis and
sales of Simdax heart failure drug, Easyhaler pulmonary drugs and
Precedex sedative for patients in intensive care were considerably
higher than in the comparative period."We are also pleased to report good progress for us in the crucial
domestic market in Finland, where we have succeeded in increasing our
sales and market share in very challenging market conditions. A new
reference price system was implemented in Finland this year that has
further intensified price competition, so the domestic pharmaceutical
market has not grown during the period under review."Thanks to the strong sales, our operating profit was higher than in
the comparative period despite slightly lower margins and higher
fixed costs. Costs were higher mainly due to the launching of sales
and marketing operations for Simdax in a number of new countries,
outsourced research projects and the ongoing patent litigation in the
United States."The transfer from Abbott to Orion of the Simdax marketing rights
repurchased in May has progressed according to plan. In the summer
and early autumn, Orion launched its own sales operations in Spain,
Italy, Austria, Greece and Portugal."After the period under review, Orion and Pfizer agreed that the
distribution rights for animal sedatives in Europe would revert to
Orion. Relating to this arrangement, Pfizer is to pay Orion four
million euros this year. Approval from the European Commission is
still required for this agreement to be implemented."Our current forecast for the Group's outlook for the full year 2009
excluding non-recurring items remains unchanged from that published
earlier in the Financial Statements and the previous Interim Reports,
in other words we are expecting our net sales and operating profit to
be slightly higher than in 2008. However, the four million euros to
be received from Pfizer later this year would lift the operating
profit above this estimate. The outlook forecast and basis for it can
be found on pages 5-6 of this report."
Events during the period
In September, Orion and Hospira, Inc. sued Sandoz companies in the
United States to enforce their US patents covering the proprietary
drug Precedex®.
Events after the review period
In October, Orion withdrew the application in the United States to
extend the indication of its drug Stalevo® for the treatment of
early-stage Parkinson's disease. This was due to Orion's assessment
of the results from clinical studies with the drug that did not show
a consistent risk/benefit profile in patients with early Parkinson's
disease at the dose used in the studies.
In October, Orion and Pfizer Animal Health agreed that the rights in
Europe to an animal sedative product family that Orion had developed
shall revert to Orion. Pfizer had been marketing Orion's drugs
Dexdomitor®, Domitor®, Domosedan® and Antisedan® almost worldwide.
Following the merger between Pfizer and Wyeth, the European
Commission has required Pfizer to relinquish some animal health
products in Europe, so it returned the rights to distribute the
product family in Europe to Orion. Pfizer will continue to market the
products in the rest of the world. Relating to this arrangement,
Pfizer is to pay Orion four million euros this year. Approval from
the European Commission is still required for this agreement to come
into force.
News conference and teleconference
A news conference and teleconference on the January-September 2009
results will be held today, Monday 26 October 2009, at 14:30 EET at
Hotel Kämp, address: Pohjoisesplanadi 29, Helsinki. CEO Timo
Lappalainen will give a brief presentation in English on the Group's
results.
The event can be followed live as a webcast accessible via the Orion
website at www.orion.fi/en/. After the presentation, questions can be
asked also by telephone in Finnish and English.
To participate in the teleconference, please call:
from the USA: +1 334 323 6203
from other countries: +44 (0)20 7162 0125
News conference recordings
A recording of the webcast of the event will be available later the
same day via a link on the Orion website.
A recording of the CEO's presentation in Finnish will be available on
the Orion website on the following day.
Financial report material
Orion's financial reports and related presentation material are
available on the Group's website at www.orion.fi/en/ promptly after
publication. The website also has a form for subscribing to Orion's
publications and releases.
Dates in Orion Calendar 2009 and 2010
Orion Capital Markets Day (CMD) 2009
Tuesday 1 December 2009 in Helsinki
Financial Statements Review for 2009
Tuesday 9 February 2010
Annual Report 2009 will be published In week
beginning 1 March 2010
Annual General Meeting
Wednesday 24 March 2010 in Helsinki
Interim Report January-March 2010
Tuesday 27 April 2010
Interim Report January-June 2010
Tuesday 10 August 2010
Interim Report January-September 2010
Tuesday 26 October 2010
Additional information:
Jari Karlson, CFO, tel. +358 10 426 2883
www.orion.fi/en/
www.orion.fi/en/investors/
Financial review Q1-Q3/2009
Net sales
The Orion Group's net sales for January-September 2009 totalled EUR
578.2 million (EUR 530.9 million in Q1-Q3/2008), up by 8.9% on the
comparative period. The net effect of currency exchange rates was
plus EUR 3.2 million.
The Pharmaceuticals business's net sales were up by 9.8% at EUR 546.6
(498.0) million. The products based on in-house R&D accounted for EUR
263.2 (230.0) million, or 48% (46%) of the operating segment's net
sales. Net sales of Orion's Parkinson's drugs Stalevo® (carbidopa,
levodopa and entacapone) and Comtess®/Comtan® (entacapone) totalled
EUR 182.2 (155.7) million, or about 33% (31%) of the segment's sales.
The Diagnostics business's net sales were EUR 33.2 (34.3) million,
down by 3.2% on the comparative period. Sales of QuikRead® infection
tests grew, but sales of the older product portfolio were lower than
in the comparative period.
Operating profit
The Orion Group's operating profit for January-September 2009 was up
by 7.1% at EUR 163.1 (152.2) million.
The Pharmaceuticals business's operating profit was EUR 165.1 (153.1)
million. Although fixed costs increased, operating profit grew by
7.8% due to good sales.
The Diagnostics business's operating profit was down by 27.1% at EUR
4.3 (5.9) million due to the slight decline in sales and clearly
increased investment in product development.
Operating expenses
The Group's sales and marketing expenses were up by 8.5% at EUR 113.5
(104.6) million. The increase was mainly due to the repurchase of the
Simdax business and related launching of sales operations in Southern
Europe.
R&D expenses were up by 7.9% at EUR 69.6 (64.5) million and accounted
for 12.0% (12.1%) of the Group's net sales. Pharmaceutical R&D
expenses amounted to EUR 65.4 (61.3) million. Ongoing research
projects are reported in more detail under Pharmaceuticals in the
Business Reviews.
Administrative expenses were EUR 38.2 (32.7) million, which is higher
than in the previous year mainly because of the EUR 7.6 (4.4) million
costs resulting from the ongoing patent litigation in the United
States. There is more information on the ongoing legal proceedings in
the section "Legal proceedings".
Other operating income and expenses increased profit by EUR 2.2 (0.9)
million, mainly due to exchange rate hedging.
Profit before taxes
Group profit before taxes totalled EUR 160.6 (152.0) million.
Earnings per share were EUR 0.84 (0.79) and equity per share EUR 2.87
(2.82). The return on capital employed before taxes (ROCE) was 39.6%
(44.8%) and the return on equity after taxes (ROE) 38.4% (35.9%).
Financial position
The Group's gearing was 1.6% (0.2%) and the equity ratio 57.6%
(65.5%).
Total liabilities at 30 September 2009 were EUR 297.2 (209.4)
million. At the end of the period, interest-bearing liabilities
amounted to EUR 158.2 (95.9) million, including EUR 117.2 (41.5)
million of long-term loans. The rise in the loans increased the
Group's cash and cash equivalents, which were EUR 151.5 (95.1)
million at the end of the period, but the Group's equity ratio and
ROCE decreased slightly at the same time.
The Group's cash and cash equivalents are invested in short-term
interest-bearing instruments issued by financially solid financial
institutions and corporations.
Cash flow
Operating cash flow increased to EUR 147.9 (101.8) million. Operating
profit was slightly higher than in the comparative period, and the
amount tied up in working capital was EUR 38.3 million less than for
the comparative period.
Cash flow from investing activities was EUR -51.1 (-41.9) million.
Cash flow from financing activities was EUR -122.2 (- 54.9) million,
as the Group took out markedly less in loans in the current year than
the comparative period. This was because most of the Group's
financing requirement was covered by the long-term loans taken out at
the end of 2008.
Capital expenditure
The Group's capital expenditure totalled EUR 51.2 (44.0) million.
This comprised EUR 17.9 (25.4) million on property, plant and
equipment and EUR 33.3 (18.6) million on intangible assets. The
largest individual investment was the repurchase of the Simdax
marketing rights from Abbott in May for EUR 26 million, including
signature and milestone payments as per the agreement.
Outlook for 2009
Net sales will increase slightly compared with 2008. Sales of
pharmaceuticals through Orion's own sales network will continue to
increase in Finland and other European countries. Global in-market
sales of Comtess/Comtan and Stalevo drugs will show further growth,
but at a slower rate than before. Deliveries of Parkinson's drugs to
Novartis are expected to increase.
Marketing expenditure will increase due to the launching of sales and
marketing activities in several countries for Simdax, which was
repurchased from Abbott, as well as the launching of other products.
Research expenditure will be slightly higher than in 2008. The costs
of ongoing patent litigation in the United States are estimated to be
higher than in 2008.
Operating profit excluding non-recurring items is forecast to be
slightly higher than in 2008. In addition, a non-recurring payment of
EUR 4 million to be received from Pfizer later this year would
increase the operating profit. A prerequisite for the payment is that
the European Commission approves the agreement between Orion and
Pfizer concerning reversion of animal sedative marketing rights in
Europe to Orion.
R&D expenses will be about EUR 95 million. In addition, about EUR 10
million will be used to support products already on the market. The
latter item is now included in costs of goods sold in the Statement
of Comprehensive Income, while previously both items were included in
R&D expenses.
The Group's capital expenditure will be about EUR 65 million,
including the repurchase of Simdax but excluding other new
substantial company or product acquisitions.
Basis for outlook
The reference price system that was implemented in Finland in April
2009 has as expected increased price competition in the category of
substitutable products. However, it has also provided new business
opportunities for Orion. Following the change, general market growth
in Finland has been slower than in 2008. Launches of new products
will support Orion's growth in Finland. On the other hand, growth
will be slowed by intense price competition especially affecting
substitutable prescription drugs, which are important products for
Orion.
As anticipated, in-market sales of the Parkinson's drugs Stalevo and
Comtess/Comtan grew by just over 10% in 2008, which was slower than
in previous years. Further slight slowing in growth is expected
during 2009. Orion's own sales are expected to grow in line with the
overall market for Parkinson's drugs. Deliveries to Novartis will
depend on Novartis's sales and any change in its stock levels.
Current information indicates that Novartis will not continue to
reduce its stock levels in 2009.
Repurchasing of the marketing rights to Simdax from Abbott will
increase sales in the latter part of the year. However, because of
the costs of launching the sales and marketing operations for the
product and the transfer from Abbott to Orion, the purchase will have
no material effect on Orion's operating profit in 2009 compared with
when Abbott was responsible for sales of the product.
Because the registrations and launches of new products are projects
that take more than a year, the increase in resources and other
inputs required for them in 2009 were planned mainly in the previous
year.
Research and development costs can be estimated quite accurately in
advance. They are partly the Company's internal fixed cost items,
such as salaries and maintenance of the operating infrastructure, and
partly the costs of long-term clinical trials, which are typically
performed in clinics located in several countries. The most important
clinical trials scheduled for 2009 are either ongoing from the
previous year or at an advanced stage of planning, so their cost
level can be estimated rather accurately.
The estimated costs of the ongoing patent litigation in the United
States are based on the planned timetables and work estimates. The
costs due to the litigation will depend on a number of factors, which
at present are difficult to estimate accurately.
Near-term risks and uncertainties relating to the outlook
The Company is not aware of any significant risk factors relating to
the earnings outlook for 2009.
The global economic recession is not expected to have a material
effect on the short-term development of the pharmaceuticals market,
but it increases uncertainty and makes forecasting more difficult.
For example, risks of payment defaults and credit losses relating to
individual countries and customers may increase slightly, and
forecasting exchange rate trends will be more challenging,
particularly in Eastern Europe.
The sales of individual products and also Orion's sales in individual
markets may vary slightly depending on the extent to which the
ever-tougher price and other competition prevailing in the
pharmaceutical markets in recent years will specifically affect
Orion's products. Deliveries to Novartis are based on timetables that
are jointly agreed in advance. Nevertheless, they can change, for
example as a consequence of decisions by Novartis concerning
adjustments of stock levels during the year. It is assumed that the
ongoing litigation will not affect the sales of Comtan or Stalevo in
the United States in 2009.
Most of the exchange rate risk relates to the US dollar. Typically,
only less than 15% of Orion's net sales come from the United States.
As regards the other most important currencies, such as the British
pound and the Swedish krona, the overall effect will be abated by the
fact that Orion has organisations of its own in the United Kingdom
and Sweden, which means that in addition to sales income, there are
also costs in these currencies. As regards the currencies of East
European countries, the situation is similar.
Research projects always entail uncertainty factors that may either
increase or decrease estimated costs. The projects may progress more
slowly or faster than assumed, or they may be discontinued.
Nonetheless, changes that may occur in ongoing clinical studies are
reflected in costs relatively slowly, and they are not expected to
have a material impact on earnings in the current year. Owing to the
nature of the research process, the timetables and costs of new
studies that are being started are known well in advance. They
therefore typically do not lead to unexpected changes in the
estimated cost structure.
Financial objectives
Orion's financial objectives are ensuring the Group's financial
stability and creating a foundation for long-term profitable growth.
The principal means of achieving these objectives are:
* improving the organic development of net sales and
operating profit through product, product portfolio and company
acquisitions
* increasing the efficiency of operations and cost control
* maintaining a stable financial position, with the equity
ratio at least 50%
Sales of the Parkinson's disease drugs Stalevo and Comtess/Comtan
currently account for approximately one-third of Orion's net sales.
The key patents for these drugs in Orion's main markets will expire
in 2012-13, which is why their sales are expected to decline over the
next few years. Orion will also bring new products to the market to
replace this drop in net sales.
The development of Orion's net sales and profitability in the next
few years will depend on how fast the sales of Parkinson's drugs will
decline and, on the other hand, how the sales of other products will
increase in the future. This creates a point of discontinuity in the
Group's operations.
Dividend policy
Orion's dividend distribution takes into account the distributable
funds and the capital expenditure and other financial requirements in
the medium and long term to achieve the financial objectives.
Shares and shareholders
On 30 September 2009, Orion had a total of 141,257,828 shares, of
which 51,440,668 were A shares and 89,817,160 B shares. The Group's
share capital is EUR 92,238,541.46. At the end of September 2009,
Orion held 280,030 B shares as treasury shares. On 30 September 2009,
the aggregate number of votes conferred by both share classes was
1,118,350,490, excluding treasury shares.
Voting rights conferred by shares
Each A share entitles its holder to twenty (20) votes at General
Meetings of Shareholders and each B share one (1) vote. However, a
shareholder cannot vote more than 1/20 of the aggregate number of
votes from the different share classes represented at the General
Meetings of Shareholders. In addition, Orion and Orion Pension Fund
do not have the right to vote at Orion Corporation's General Meetings
of Shareholders.
Both share classes, A and B, confer equal rights to the Company's
assets and dividends.
The Articles of Association entitle shareholders to demand the
conversion of their A shares to B shares. No shares were converted
during January-September 2009.
Trading in Orion's shares
Orion's A shares and B shares are quoted on NASDAQ OMX Helsinki in
the Large Cap group under the Healthcare sector heading under the
trading codes ORNAV and ORNBV. Trading in both of the Company's share
classes commenced on 3 July 2006. Information on trading in the
Company's shares has been available since this date. On 30 September
2009, the market capitalisation of the Company's shares excluding
treasury shares was EUR 1 781.5 million.
Authorisation of the Board of Directors to dispose of shares
Orion's Board of Directors was authorised by the Annual General
Meeting on 23 March 2009 to dispose of shares held by the Company
(treasury shares). This authorisation is valid until the close of the
2010 Annual General Meeting. The Board of Directors is not authorised
to increase the share capital or to issue bonds with warrants or
convertible bonds or stock options.
Altogether 44,806 B shares held by the Company were transferred in
March as a share bonus for 2008 to persons employed by the Company
and belonging to the Share-based Incentive Plan of the Orion Group.
This was based on the authorisation granted by the Annual General
Meeting on 25 March 2008. The transfer price of the shares
transferred was EUR 11.97 per share, which was the weighted average
price of the B shares on 5 March 2009. The total transfer price of
the shares transferred was EUR 536,417.43.
Following the transfer, Orion holds 280,030 B shares as treasury
shares.
Share ownership
At the end of September 2009, Orion had a total of 50,870 registered
shareholders, of whom 94.0% were private individuals holding 51.1% of
the entire share stock and 60.0% of the total votes. There were
altogether 29.45 million nominee-registered shares (20.8% of all
shares) with entitlement to 4.5% of the votes.
At the end of September 2009, Orion held 280,030 B shares as treasury
shares, which represent 0.2% of the Company's total share stock and
0.03% of the total votes.
No new transactions exceeding the notification threshold set in the
Finnish Securities Markets Act were brought to the attention of the
Company during the period under review.
Personnel
The average number of employees in the Group in January-September
2009 was 3,210 (3,255). At the end of September, the Group had a
total of 3,125 (3,300) employees, of whom 2,532 (2,716) worked in
Finland and 593 (584) outside Finland.
Salaries and other personnel expenses in January-September totalled
EUR 123.9 (120.1) million.
Legal proceedings
Legal proceedings against the Sun companies
On 13 November 2007, 7 February 2008 and 12 November 2008, Orion
Corporation filed patent infringement lawsuits in the United States
to enforce US Patents No. 6,500,867 and 5,446,194 against companies
belonging to the Sun Group.
Sun Pharmaceutical Industries Limited seeks to market generic
versions of Orion's Stalevo drug (25/100/200 and 37.5/150/200 mg
strengths of carbidopa, levodopa and entacapone) in the United
States. Sun Pharma Global, Inc. seeks to market a generic version of
Orion's proprietary drug Comtan in the United States.
Legal proceedings against the Sandoz companies
On 4 September 2009, Orion Corporation and Hospira, Inc. filed
together a patent infringement lawsuit in the United States against
Sandoz International Gmbh and Sandoz Inc. to enforce their patents
valid in the United States. The legal proceedings concern Orion's US
Patent No. 4,910,214 and Orion's and Hospira's commonly owned US
Patent No. 6,716,867.
Sandoz Inc. has sought authorisation to produce and market in the
United States a generic version of Orion's proprietary drug Precedex®
(dexmedetomidine hydrochloride 100 microgram base/ml), which is
marketed in the United States by Orion's licensee Hospira.
Orion expects the costs of the legal proceedings against the Sandoz
companies to be substantially less than the costs of the ongoing
entacapone patent litigation in the United States.
Business Reviews
Pharmaceuticals
Review of human pharmaceuticals market
Finland is the most important market for Orion, generating just under
one-third of Orion's net sales. According to statistics collected by
Finnish Pharmaceutical Data Ltd, Finnish wholesale of human
pharmaceuticals in January-September 2009 totalled EUR 1 433.9
million, down by 0.2% on the comparative period. In terms of the
number of packages, overall sales were down by 2.5%. Total pharmacy
sales were similar to the comparative period, while hospital sales
were up by 0.8%. The wholesale of prescription drugs in the whole
market was down by 0.1% and wholesale of self-care products up by
2.7%.
Orion continued to strengthen its position as leader in marketing
pharmaceuticals in Finland. According to statistics collected by
Finnish Pharmaceutical Data Ltd, Orion's wholesale of pharmaceuticals
in Finland in January-September 2009 amounted to EUR 137.2 million,
up by 4.0% on the comparative period. Orion's sales clearly grew,
even though the overall market remained almost unchanged on the
comparative period. Orion's market share was 9.6% (9.4%), which was
2.6 percentage points higher than the second-largest company's market
share.
Globally, the most important individual therapy area for Orion is the
treatment of Parkinson's disease. Orion's Parkinson's drugs account
for approximately one-third of the Group's net sales. According to
IMS Health pharmaceutical sales statistics, in the 12-month period
ending in June 2009 the total sales of Parkinson's drugs to retail
distributors in the United States came to USD 945 million (USD 1,096
million in the previous 12-month period), which is 14% less than in
the comparative period. The rapid change in the market trend was
caused by the expiry of the patent for the leading product, a
dopamine agonist, and the resulting competition created by the launch
of generic products. The five largest European markets for
Parkinson's drugs were Germany, the United Kingdom, France, Spain and
Italy. In these countries, the combined sales of Parkinson's drugs to
retail distributors in the 12-month period ending in June totalled
EUR 885 (834) million, and the average market growth was 6%.
Sales of Orion's Parkinson's drugs continued to grow clearly faster
than the market as a whole. According to IMS Health pharmaceutical
sales statistics, in the 12-month period ending in June 2009, sales
of Orion's Parkinson's drugs to retail distributors were up by 13% at
EUR 415 million (EUR 367 million in the previous 12-month period). In
addition, hospital sales of Orion's Parkinson's drugs amounted to EUR
59 million. In the United States, sales of Orion's Parkinson's drugs
to retail distributors in the 12-month period ending in June were USD
166 (149) million, up by 11% on the comparative period. The market
share of Orion's Parkinson's drugs in the United States was about
17%. In the five largest Parkinson's drugs markets in Europe, sales
of Orion's Parkinson's drugs to retail distributors in the 12-month
period ending in June totalled EUR 145 (135) million, up by 7% on the
comparative period. Orion's Parkinson's drugs have an average market
share of about 16% in these five markets.
Net sales and operating profit of the Pharmaceuticals business
Net sales of the Pharmaceuticals business in January-September 2009
were EUR 546.6 (498.0) million, up by 9.8% on the comparative period.
The Pharmaceuticals business operating profit was up by 7.8% at EUR
165.1 (153.1) million. The EBIT margin of the Pharmaceuticals
business was 30.2% (30.8%) of the segment's net sales.
Proprietary Products
The product portfolio of Proprietary Products consists of patented
prescription products. Net sales of the division in January-September
2009 were up by 18.3% at EUR 246.8 (208.7) million.
Net sales of Orion's Parkinson's drugs in January-September 2009
totalled EUR 182.2 (155.7) million. The net sales were up by 17.0%
and accounted for 33% (31%) of the total net sales of the
Pharmaceuticals business. Net sales from deliveries of Stalevo and
Comtan to Novartis totalled EUR 111.4 (88.3) million, up by 26.1% on
the comparative period. Deliveries of Stalevo to Novartis increased
by 26.5%, and deliveries of Comtan by 25.4%. Total net sales
generated by Stalevo and Comtess in Orion's own sales organisation
were up by 5.0% at EUR 70.8 (67.4) million. Net sales of Stalevo
through Orion's own sales organisation were up by 13.4% at EUR 55.3
(48.8) million. The weak British pound and Scandinavian currencies
have slowed euro-denominated sales.
Orion has ongoing patent litigation in the United States against the
Sun companies and Sandoz companies. The Sun companies aim to launch
generic versions of Orion's Comtan and Stalevo, and the Sandoz
companies a generic version of Orion's Precedex in the United States.
Sales of Simdax, a drug for acute decompensated heart failure,
developed well and the transfer of the rights to the product from
Abbott to Orion has progressed according to plan.
Net sales of the Easyhaler® product family for the treatment of
asthma and chronic obstructive pulmonary disease in January-September
2009 were up by 13.6% at EUR 18.5 (16.3) million. Sales grew
especially well in Germany. The rights to Easyhaler products in
Hungary were transferred back to Orion in July.
Specialty Products
Net sales of the Specialty Products business division's off-patent,
i.e. generic, prescription drugs and self-care products were up by
4.9% in January-September 2009 at EUR 201.8 (192.4) million.
Net sales of Orion's human pharmaceuticals in Finland in
January-September 2009 were up by 4% at EUR 150.4 (143.9) million.
Specialty Products accounted for the majority of sales in Finland.
Although market conditions deteriorated, Orion managed to improve its
market position owing to continuous updating of its broad product
portfolio, particularly in substitutable prescription drugs. The
reference price system, which was introduced in April, has further
intensified price competition, but also expanded the range of
substitutable products. For example, the anti-psychotic drug
Ketipinor® (quetiapine) and the cholesterol-lowering drug
Atorvastatin Orion® (atorvastatin) have been particularly successful.
Net sales of Orion's human pharmaceuticals in Eastern Europe in
January-September 2009 were down by 3% at EUR 28.1 (28.9) million.
Specialty Products accounted for the majority of sales in the region.
The growth of euro-denominated net sales in Eastern Europe has been
slowed by the severe depreciation of currencies in the region and the
economic recession.
Animal Health
Net sales of the Animal Health business division were down by 9.2% in
January-September 2009 at EUR 46.0 (50.7) million. Net sales of the
animal sedatives Dexdomitor® (dexmedetomidine), Domitor®
(medetomidine), Domosedan® (detomidine) and Antisedan® (atipamezole)
were down by nearly 30% and accounted for 29% (38%) of the division's
net sales. Sales of animal sedatives decreased due to price
competition in Europe following the expiry of patents.
Orion is the Finnish market leader in veterinary drugs. Comparing
January-September 2009 with the corresponding period in 2008, the
Finnish animal health market grew by 7.2% while Orion's net sales of
veterinary medicines in Finland grew by 8.7%. Orion's share of the
Finnish animal health market was 20.6%. The strong growth in sales
was mainly due to Orion's extensive product portfolio and its
operations in the Finnish animal health market over a long time.
In July, Orion signed a distribution agreement with the US company
SentrX Animal Care, Inc. concerning distribution of wound care and
other animal health products in eight European countries.
Fermion
Net sales of Fermion, a manufacturer of active pharmaceutical
ingredients, were up by 23.2% in January-September 2009 at EUR 32.4
(26.3) million. The effect of intra-Group transactions (deliveries of
active ingredients for Orion's own use) has been eliminated from
Fermion's net sales. Sales to other pharmaceutical companies
increased despite intense price competition, and orders for some key
products are at a high level.
Ten best-selling pharmaceutical products
Net sales of the top ten pharmaceuticals were up by 12.8% in
January-September 2009 at EUR 286.3 (253.8) million. These products
accounted for 52% (51%) of the total net sales of the Pharmaceuticals
business. The heart failure drug Simdax, the Precedex sedative for
patients in intensive care, the Parkinson's drug Stalevo and the
Easyhaler pulmonary drugs had the fastest growth rates among the
best-sellers.
Products from in-house research
Net sales of products from in-house research were up by 14.4% in
January-September 2009 at EUR 263.2 (230.0) million. These products
accounted for about 48% (46%) of the net sales of the Pharmaceuticals
business.
Research and development
Orion's pharmaceutical R&D focuses on the following core therapy
areas: central nervous system drugs, oncology and critical care
drugs, and Easyhaler pulmonary drugs. In addition to in-house
research, Orion invests in early-stage R&D jointly with universities
and other pharmaceutical companies. In late stage clinical studies,
Orion prefers to share the costs with other pharmaceutical companies.
In this way, Orion can ensure an increasing number of new research
projects and reinforce its capability to continue operating as a
company that provides new drugs and engages in pharmaceutical R&D.
The Group's R&D expenses totalled EUR 69.6 (64.5) million, of which
the Pharmaceuticals business accounted for EUR 65.4 (61.3) million.
The Group's R&D expenses accounted for 12.0% (12.1%) of the Group's
net sales.
In October, Orion withdrew the application in the United States to
extend the indication of its drug Stalevo for the treatment of
early-stage Parkinson's disease. This was due to Orion's assessment
of the results from clinical studies with the drug that did not show
a consistent risk/benefit profile in patients with early Parkinson's
disease at the dose used in the studies. Stalevo is currently
approved for treatment of advanced Parkinson's disease.
Phase III clinical studies with the sedative dexmedetomidine are in
progress in patients in intensive care as a prolonged infusion
administered for over 24 hours. The programme aims to have the drug
registered in the EU. The drug is already available in, for example,
the United States and Japan as a sedative for patients in intensive
care, administrable as an infusion for a maximum of 24 hours. The
efficacy and safety of dexmedetomidine is compared with midazolam in
the MIDEX study and with propofol in the PRODEX study. It is planned
to recruit 500 patients for both studies. All 500 patients have
already been recruited for the MIDEX study, the recruitment of
patients for the PRODEX study continues. Results from the whole
research programme are expected at the latest in summer 2010.
To expand the Easyhaler product family, Orion has an ongoing research
programme to develop a new budesonide-formoterol formulation
combining budesonide as an anti-inflammatory agent and formoterol as
a long-acting bronchodilator. Orion's aim is to utilise Easyhaler
technology not just in current products and development projects, but
also to develop new products.
Orion is collaborating with Novartis to develop Stalevo for the
Japanese market.
The LEVET programme is studying the efficacy of orally administered
levosimendan in the treatment of heart diseases in dogs, with the aim
of obtaining marketing authorisations in the United States and
Europe.
An alpha 2c receptor antagonist is being studied in clinical Phase I.
In early research, this compound has been found to be possibly
suitable for the treatment of the symptoms of schizophrenia or
Alzheimer's disease.
Orion has several projects in early research phase investigating
selective androgen receptor modulators (SARM), prostate cancer,
neuropathic pain, Parkinson's disease and other possible indications
within intensive care, among others.
Diagnostics
Net sales of the Diagnostics business in January-September 2009 were
EUR 33.2 (34.3) million, down by 3.2% on the comparative period.
Sales of several older product lines continued to decline further on
the comparative period. In contrast, sales of QuikRead® instruments
and tests continued to grow. Euro-denominated net sales were slowed
by weakening of Nordic currencies, whereas sales to China and the
Czech Republic increased on the comparative period.
Operating profit at EUR 4.3 (5.9) million was 27.1% down on the
comparative period due to a decline in sales and planned increased
investments in product development.
Espoo, 26 October 2009
Board of Directors of Orion Corporation
Orion Corporation
Timo
Lappalainen
Jari Karlson
President and
CEO
CFO
Tables
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Change
EUR million Q3/09 Q3/08 Change % Q1-Q3/09 Q1-Q3/08 % 2008
Net sales 191.8 170.1 +12.8% 578.2 530.9 +8.9% 710.7
Cost of goods
sold -66.3 -61.5 +7.8% -196.1 -177.8 +10.3% -243.4
Gross profit 125.6 108.6 +15.6% 382.1 353.1 +8.2% 467.4
Other income
and expenses 0.0 -1.6 -100.9% 2.2 0.9 +147.1% 3.1
Selling and
marketing
expenses -38.2 -32.3 +18.2% -113.5 -104.6 +8.5% -143.9
R&D expenses -20.5 -20.3 +0.8% -69.6 -64.5 +7.9% -90.0
Administrative
expenses -11.2 -10.8 +3.5% -38.2 -32.7 +16.7% -51.5
Operating
profit 55.7 43.6 +27.9% 163.1 152.2 +7.1% 185.0
Finance income 1.2 1.5 -24.6% 4.3 3.9 +9.6% 7.6
Finance
expenses -1.9 -2.0 -5.2% -6.8 -4.1 +65.9% -8.5
Profit before
taxes 54.9 43.1 +27.6% 160.6 152.0 +5.6% 184.2
Income tax
expense -14.6 -11.3 +29.0% -42.2 -40.4 +4.5% -47.8
PROFIT FOR THE
PERIOD 40.3 31.7 +27.1% 118.4 111.6 +6.0% 136.3
Other
comprehensive
income
Translation
differences -0.2 -0.3 -15.1% 0.9 -0.6 +263.5% -2.8
Cash flow
hedges -0.2 -0.5 -65.6% 0.1 0.3 -75.0% -1.0
Other
comprehensive
income net of
tax -0.4 -0.7 -48.4% 1.0 -0.3 +417.2% -3.9
TOTAL
COMPREHENSIVE
INCOME
FOR THE PERIOD 40.0 31.0 +28.9% 119.4 111.3 +7.2% 132.5
of which
attributable
to:
Parent company
shareholders 40.3 31.7 +27.1% 118.4 111.6 +6.0% 136.3
Minority
interest 0.0 0.0 0.0 0.0 0.0
Total
comprehensive
income
attributable
to:
Parent company
shareholders 40.0 31.0 +28.9% 119.4 111.3 +7.2% 132.5
Minority
interest 0.0 0.0 0.0 0.0 0.0
Earnings per
share, EUR 1)) 0.29 0.23 +27.0% 0.84 0.79 +6.1% 0.97
Depreciation
and
amortisation 8.8 8.0 +10.6% 25.3 23.2 +8.7% 31.6
Personnel
expenses 37.5 36.2 +3.8% 123.9 120.1 +3.2% 170.9
(1)The figure has been calculated from the profit attributable to the
parent company shareholders. The Company has no items that could
dilute the earnings per share.
STATEMENT OF FINANCIAL POSITION
Assets
EUR million 9/09 9/08 Change % 2008
Property, plant and equipment 190.3 192.4 -1.1% 192.4
Goodwill 13.5 13.5 13.5
Intangible rights 63.8 34.6 +84.4% 37.5
Other intangible assets 3.6 2.3 +57.1% 2.9
Investments in associates 0.1 0.1 -18.6% 0.1
Available-for-sale investments 1.0 0.9 +4.7% 0.9
Pension asset 33.8 25.2 +33.9% 29.3
Deferred tax assets 3.8 3.2 +16.5% 4.2
Other non-current assets 1.6 4.2 -61.1% 1.5
Non-current assets total 311.4 276.4 +12.7% 282.3
Inventories 121.9 134.9 -9.6% 131.7
Trade receivables 101.3 85.1 +19.0% 83.1
Other receivables 15.5 14.9 +3.6% 22.3
Cash and cash equivalents 151.5 95.1 +59.3% 176.1
Current assets total 390.2 330.1 +18.2% 413.1
ASSETS TOTAL 701.6 606.5 +15.7% 695.5
Equity and liabilities
EUR million 9/09 9/08 Change % 2008
Share capital 92.2 92.2 92.2
Share premium 17.8 17.8 17.8
Expendable fund 23.0 23.0 23.0
Other reserves -0.8 0.4 -290.3% -0.9
Retained earnings 272.1 263.6 +3.2% 286.3
Equity of the parent company shareholders 404.4 397.1 +1.8% 418.5
Minority interest 0.0 0.0 -15.4% 0.0
Equity total 404.4 397.1 +1.8% 418.6
Deferred tax liabilities 41.6 41.4 +0.4% 42.0
Pension liability 0.7 0.9 -27.3% 0.8
Provisions 0.5 0.4 +18.8% 0.4
Interest-bearing non-current liabilities 117.2 41.5 +182.7% 109.9
Other non-current liabilities 0.7 2.1 -66.3% 0.9
Non-current liabilities total 160.6 86.3 +86.2% 153.9
Trade payables 35.4 24.2 +46.0% 30.2
Income tax liabilities 2.2 2.6 -17.6% 2.4
Other current liabilities 58.1 41.8 +38.9% 54.0
Provisions 0.0 0.0 -100.0% 0.0
Interest-bearing current liabilities 41.0 54.4 -24.8% 36.4
Current liabilities total 136.6 123.1 +10.9% 123.0
Liabilities total 297.2 209.4 +41.9% 276.9
EQUITY AND LIABILITIES TOTAL 701.6 606.5 +15.7% 695.5
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
a. Share capital
b. Share premium
c. Expendable fund
d. Other reserves
e. Translation differences
f. Retained earnings
g. Total
h. Minority interest
i. Equity total
EUR million a. b. c. d. e. f. g. h. i.
Equity on 31 Dec
2008 92.2 17.8 23.0 -0.9 -6.9 293.3 418.5 0.0 418.6
Dividend -133.9 -133.9 -133.9
Share-based
incentive plan 0.5 0.5 0.5
Comprehensive
income 0.1 0.9 118.4 119.4 0.0 119.4
Equity on 30 Sep
2009 92.2 17.8 23.0 -0.8 -6.0 278.2 404.4 0.0 404.4
Equity on 31 Dec
2007 92.2 17.8 23.0 0.5 -4.1 301.7 431.1 0.0 431.2
Dividend -140.9 -140.9 -140.9
Repurchase of own
shares -4.8 -4.8 -4.8
Share-based
incentive plan 0.5 0.5 0.5
Transfer in equity -0.3 0.3
Comprehensive
income 0.3 -0.6 111.6 111.3 0.0 111.3
Equity on 30 Sep
2008 92.2 17.8 23.0 0.4 -4.7 268.3 397.1 0.0 397.1
CONSOLIDATED CASH FLOW STATEMENT
EUR million Q1-Q3/09 Q1-Q3/08 2008
Operating profit 163.1 152.2 185.0
Adjustments 22.8 26.6 28.7
Change in working capital 1.0 -37.3 -15.0
Interest paid -6.3 -2.3 -7.0
Interest received 4.3 4.0 7.5
Income taxes paid -36.9 -41.3 -54.9
Total net cash from operating activities 147.9 101.8 144.4
Investments in property, plant and equipment -18.1 -24.4 -30.8
Investments in intangible assets -33.6 -18.6 -23.0
Sales of property, plant and equipment
and available-for-sale investments 0.8 1.1 1.5
Sales of intangible assets -0.2 0.0 0.5
Total net cash used in investing activities -51.1 -41.9 -51.8
Withdrawals of short-term loans 0.6 51.2 121.7
Repayments of short-term loans -0.9 0.0 -105.1
Withdrawals of long-term loans 22.8 40.0 125.0
Repayments of long-term loans -10.8 -0.4 -0.5
Repurchase of own shares 0.0 -4.8 -4.8
Dividends paid and other distribution of
profits -133.9 -140.9 -141.1
Total net cash used in financing activities -122.2 -54.9 -4.8
Net change in cash and cash equivalents -25.3 5.1 87.7
Cash and cash equivalents at the beginning
of the period 176.1 90.4 90.4
Foreign exchange differences 0.7 -0.4 -2.1
Net change in cash and cash equivalents -25.3 5.1 87.7
Cash and cash equivalents at the end of the
period 151.5 95.1 176.1
CHANGES IN PROPERTY, PLANT AND EQUIPMENT
EUR million Q1-Q3/09 Q1-Q3/08 2008
Carrying amount at the beginning of the
period 192.4 186.6 186.6
Additions 17.9 25.4 32.8
Disposals -0.8 -1.1 -1.8
Depreciation -19.2 -18.5 -25.1
Carrying amount at the end of the period 190.3 192.4 192.4
CHANGES IN INTANGIBLE ASSETS (EXCL. GOODWILL)
EUR million Q1-Q3/09 Q1-Q3/08 2008
Carrying amount at the beginning of the period 40.4 23.0 23.0
Additions 33.3 18.6 24.0
Disposals -0.3 -0.0 -0.0
Depreciation -6.0 -4.7 -6.6
Carrying amount at the end of the period 67.4 36.9 40.4
In May, Orion repurchased the rights to Simdax from Abbott. The
purchase price, EUR 26.2 million,
was recognised in full under intangible rights in the Statement of
Financial Position.
COMMITMENTS AND CONTINGENCIES
EUR million 9/09 9/08 2008
Contingent for own liabilities
Mortgages on land and buildings 45.0 19.0 19.0
of which those to Orion Pension Fund 9.0 9.0 9.0
Guarantees 1.0 1.2 1.0
Other liabilities
Leasing liabilities (excl. finance lease contracts) 4.0 3.9 4.0
Other liabilities 0.3 0.3 0.3
DERIVATIVES
EUR million 9/09 9/08 2008
Fair value of currency forward contracts -0.0 -1.2 2.0
Nominal values of derivatives 67.7 63.9 64.6
Fair value of electricity forward contracts -1.3 0.3 -1.4
Nominal values of derivatives 7.0 4.9 5.7
RELATED PARTY TRANSACTIONS
EUR million Q1-Q3/09 Q1-Q3/08 2008
Management's employment benefits 2.9 2.5 3.1
Performance by operating segment
NET SALES BY BUSINESS AREA
Change Change
EUR million Q3/09 Q3/08 % Q1-Q3/09 Q1-Q3/08 % 2008
Pharmaceuticals 181.8 161.0 +12.9% 546.6 498.0 +9.8% 667.6
Proprietary
Products 81.1 68.1 +19.1% 246.8 208.7 +18.3% 278.1
Specialty
Products 67.9 62.8 +8.2% 201.8 192.4 +4.9% 260.5
Animal
Health 15.6 16.3 -4.2% 46.0 50.7 -9.2% 67.2
Fermion 10.4 6.8 +53.0% 32.4 26.3 +23.2% 36.1
Other 6.6 6.9 -4.2% 19.6 19.9 -1.5% 25.7
Diagnostics 10.5 9.5 +10.4% 33.2 34.3 -3.2% 45.0
Group items -0.5 -0.4 +22.7% -1.5 -1.4 +11.1% -1.9
Group total 191.8 170.1 +12.8% 578.2 530.9 +8.9% 710.7
OPERATING PROFIT BY BUSINESS AREA
EUR million Q3/09 Q3/08 Change % Q1-Q3/09 Q1-Q3/08 Change % 2008
Pharmaceuticals 56.6 44.3 +27.9% 165.1 153.1 +7.8% 188.5
Diagnostics 1.0 1.0 -4.5% 4.3 5.9 -27.1% 6.1
Group items -1.9 -1.8 +9.0% -6.4 -6.9 -7.2% -9.6
Group total 55.7 43.6 +27.9% 163.1 152.2 +7.1% 185.0
NET SALES BY ANNUAL QUARTERS
2009 2008 2007
EUR million Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4
Pharmaceuticals 181.8 185.9 178.9 169.6 161.0 168.5 168.5 162.7
Diagnostics 10.5 11.0 11.7 10.7 9.5 12.6 12.2 10.5
Group items -0.5 -0.5 -0.5 -0.5 -0.4 -0.5 -0.5 -0.4
Group total 191.8 196.4 190.1 179.9 170.1 180.5 180.2 172.8
OPERATING PROFIT BY ANNUAL QUARTERS
2009 2008 2007
EUR million Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4
Pharmaceuticals 56.6 51.6 56.9 35.3 44.3 45.7 63.1 41.7
Diagnostics 1.0 1.1 2.2 0.2 1.0 2.5 2.3 0.1
Group items -1.9 -2.3 -2.2 -2.7 -1.8 -3.1 -2.1 -3.1
Group total 55.7 50.4 56.9 32.8 43.6 45.2 63.4 38.6
GEOGRAPHICAL BREAKDOWN OF NET SALES BY ANNUAL QUARTERS
2009 2008 2007
EUR million Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4
Finland 55.6 55.0 53.5 55.2 52.8 53.5 55.7 53.7
Scandinavia 24.5 25.8 25.4 23.7 23.3 26.1 28.1 24.3
Other Europe 68.9 71.8 61.2 62.0 56.2 61.4 64.4 57.5
North America 18.1 18.2 22.6 19.2 21.7 18.5 14.4 15.4
Other markets 24.7 25.6 27.4 19.8 16.1 21.1 17.6 21.9
Group total 191.8 196.4 190.1 179.9 170.1 180.5 180.2 172.8
Business reviews
KEY FIGURES FOR PHARMACEUTICALS BUSINESS
Change
EUR million Q3/09 Q3/08 Change % Q1-Q3/09 Q1-Q3/08 % 2008
Net sales 181.8 161.0 +12.9% 546.6 498.0 +9.8% 667.6
Operating profit 56.6 44.3 +27.9% 165.1 153.1 +7.8% 188.5
% of net
sales 31.2% 27.5% 30.2% 30.8% 28.2%
R&D expenses 19.3 19.3 -0.1% 65.4 61.3 +6.7% 85.4
% of net
sales 10.6% 12.0% 12.0% 12.3% 12.8%
Capital
expenditure 10.2 12.0 -14.9% 49.2 41.5 +18.5% 53.3
% of net
sales 5.6% 7.5% 9.0% 8.3% 8.0%
Sales revenue
from in-house
developed
products 87.5 73.6 +18.9% 263.2 230.0 +14.4% 307.5
Personnel at the
end of the period 2 806 2 985 -6.0% 2 995
NET SALES OF ORION'S TOP 10 PHARMACEUTICAL PRODUCTS
Change
EUR million Q3/09 Q3/08 Change % Q1-Q3/09 Q1-Q3/08 % 2008
Stalevo®
(Parkinson's
disease) 43.0 33.4 +28.6% 127.7 106.0 +20.5% 141.0
Comtess® /
Comtan®
(Parkinson's
disease) 15.9 17.1 -7.1% 54.5 49.7 +9.6% 67.4
Simdax® (heart
failure) 8.9 3.5 +154.7% 20.3 13.0 +56.6% 17.3
Easyhaler®
product family
(asthma, COPD) 5.9 5.6 +5.9% 18.5 16.3 +13.6% 22.2
Burana®
(inflammatory
pain) 5.0 4.8 +4.8% 14.2 14.1 +0.5% 19.4
Domitor®,
Dexdomitor®,
Domosedan® and
Antisedan®
(animal
sedatives) 5.0 5.2 -2.3% 13.5 19.2 -29.6% 24.6
Precedex®
(sedative for
patients in
intensive care) 3.4 2.8 +18.2% 10.1 7.1 +42.2% 9.6
Divina® range
(menopausal
symptoms) 3.0 3.7 -19.1% 10.1 11.2 -10.1% 14.7
Enanton®
(prostate cancer) 2.8 3.2 -10.7% 8.9 9.7 -8.1% 12.7
Fareston® (breast
cancer) 2.3 2.2 +6.0% 8.5 7.5 +12.7% 10.5
Total 95.3 81.5 +16.9% 286.3 253.8 +12.8% 339.7
Share of
pharmaceutical
net sales 52% 51% 52% 51% 51%
KEY FIGURES FOR DIAGNOSTICS BUSINESS
EUR million Q3/09 Q3/08 Change % Q1-Q3/09 Q1-Q3/08 Change % 2008
Net sales 10.5 9.5 +10.4% 33.2 34.3 -3.2% 45.0
Operating
profit 1.0 1.0 -4.5% 4.3 5.9 -27.1% 6.1
% of net
sales 9.4% 10.8% 13.0% 17.3% 13.6%
Capital
expenditure 1.0 0.3 +187.9% 1.9 1.8 +6.6% 2.8
% of net
sales 9.3% 3.6% 5.7% 5.1% 6.2%
Personnel at
the end of the
period 292 288 +1.0% 287
Information on Orion's shares
Basic SHARE information 30 September 2009
A shares B shares Total
ISIN code FI0009014369 FI0009014377
Trading code on NASDAQ OMX
Helsinki ORNAV ORNBV
Reuters code ORNAV.HE ORNBV.HE
Bloomberg code ORNAV.FH ORNBV.FH
Share capital, EUR million 33.6 58.6 92.2
Counter book value of the
share, EUR 0.65 0.65
Total number of shares 51 440 668 89 817 160 141 257 828
% of total share stock 36% 64% 100%
Number of treasury shares 280 030 280 030
Total number of shares
excluding treasury shares 51 440 668 89 537 130 140 977 798
Minimum number of shares 1
Maximum number of shares 500 000 000 1 000 000 000 1 000 000 000
Votes per share 20 1
Number of votes excluding
treasury shares 1 028 813 360 89 537 130 1 118 350 490
% of total votes 92% 8% 100%
Total number of
shareholders 16 268 34 602 50 870
A shares and B shares confer equal rights to the Company assets and
dividends.
INFORMATION ON TRADING 1 JAN-30 SEP 2009
A shares B shares Total
Shares traded 2 321 005 67 163 442 69 484 447
% of the total number of shares 4.5% 75.0% 49.3%
Trading volume, EUR million 27.8 797.5 825.3
Closing quotation on 2 Jan 2009, EUR 12.55 12.63
Lowest quotation, EUR (A and B, 30
Mar 2009) 10.42 10.35
Average quotation, EUR 11.97 11.87
Highest quotation, EUR (A and B, 30
Jan 2009) 13.95 13.98
Closing quotation on 30 Sep 2009, EUR 12.70 12.60
Market capitalisation on 30 Sep 2009
excluding treasury shares, EUR
million 653.3 1 128.2 1 781.5
PERFORMANCE PER SHARE
Change Change
Q3/09 Q3/08 % Q1-Q3/09 Q1-Q3/08 % 2008
Earnings per
share, EUR 0.29 0.23 +27.0% 0.84 0.79 +6.1% 0.97
Cash flow per
share before
financial
items, EUR 0.33 0.18 +89.4% 0.69 0.43 +61.6% 0.66
Equity per
share, EUR 2.87 2.82 +1.8% 2.97
Average
number of
shares
excluding
treasury
shares, 1,000
shares 140 978 140 933 140 967 141 026 141 003
Appendices
Orion Group structure
Orion Corporation is the parent company of the Orion Group. The Group
consists of two business areas, or operating segments, and five
business divisions:
* Pharmaceuticals business
o Proprietary Products (patented prescription products)
o Specialty Products (off-patent, generic prescription
products and self-care products)
o Animal Health (veterinary products for pets and production
animals)
o Fermion (active pharmaceutical ingredients)
* Diagnostics businesso Orion Diagnostica (diagnostic tests).
Accounting policies
This Interim Report of the Orion Group 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 Statements for 2008. In addition, the following
standard amendments have been applied as of 1 January 2009
* IFRS 8, Operating Segments. The Group's operating segments are
based on the Group's internal organisational structure and
intra-Group financial reporting. The monitoring of business by
the Executive Management Board is based on products and
geographical regions. The amendment to the standard had no effect
on the division into segments. The operating segments are the
Pharmaceuticals business and the Diagnostics business. The
geographical regions for reporting are Finland, Scandinavia,
Other Europe, North America and Other Countries.
* IAS 1, Presentation of Financial Statements. The Group has
adopted Statement of Comprehensive Income, presented as one
statement. The amendment to the standard has also been taken into
account in the way in which the Statement of Changes in Equity is
presented.
The following standards and interpretations that came into force in
2009 were applied in the financial period. The adoption of these
standards and interpretations had no material effect on the
consolidated financial statements:
* IAS 23 (Amendment), Borrowing Costs. Borrowing costs relating to
assets that meet the criteria are capitalised as part of the
acquisition cost of the asset.
* IFRS 2, Share-based Payments.
* IFRIC 11, IFRS 2, Group and Treasury Share Transactions.
The policies and calculation methods applied during the period are
available on the Orion website at www.orion.fi/en/investors/.
The figures in this Interim Report have not been audited.
The figures in parentheses are for the comparative period, i.e. the
corresponding period in the previous year. The per-share ratios have
been adjusted. All the figures have been rounded, which is why the
total sums of individual figures may differ from the total sums
shown.
CALCULATION OF THE KEY FIGURES
Profit before taxes + Interest and
Return on capital other finance expenses
employed (ROCE),% = Total assets - Non-interest-bearing x 100
liabilities (average during the
period)
Profit for the period
Return on equity (ROE),% = Equity total (average during the x 100
period)
Equity ratio,% = Equity x 100
Total assets - Advances received
Interest-bearing liabilities - Cash
Gearing,% = and cash equivalents x 100
Equity
Profit available for the parent
Earnings per share, EUR = company shareholders
Average number of shares during the
period, excluding treasury shares
Cash flow from operating activities
Cash flow per share + Cash flow from investing
before financial items, = activities
EUR Average number of shares during the
period, excluding treasury shares
Equity of the parent company
Equity per share, EUR = shareholders
Number of shares at the end of the
period, excluding treasury shares
Total EUR value of shares traded
Average share price, EUR = Average number of traded shares
during the period
Number of shares Closing
Market capitalisation, = at the end of x quotation of
EUR million the period the period
ADJUSTED KEY FIGURES
Q3/08 Q3/08 Q1-Q3/08 Q1-Q3/08 2008 2008
Earlier Adjusted Earlier Adjusted Earlier Adjusted
reported reported reported
Gross profit,
EUR million 109.1 108.6 361.8 353.1 480.8 467.4
R&D expenses,
EUR million 23.1 20.3 74.0 64.5 103.4 90.0
% of net
sales 13.8% 11.9% 14.0% 12.1% 14.5% 12.7%
Net sales
Proprietary
Products, EUR
million 69.5 68.1 213.8 208.7 284.7 278.1
Net sales
Specialty
Products, EUR
million 61.4 62.8 187.4 192.4 254.0 260.5
Pro forma Pro forma
2008 2008 2007 2007 2006 2006
Earlier Adjusted Earlier Adjusted Earlier Adjusted
reported reported reported
Gross profit,
EUR million 480.8 467.4 460.7 447.2 434.9 422.3
R&D expenses,
EUR million 103.4 90.0 98.5 85.0 85.7 73.1
% of
net sales 14.5% 12.7% 14.5% 12.5% 13.4% 11.4%
Net sales
Proprietary
Products, EUR
million 284.7 278.1 270.8 259.6 256.6 242.0
Net sales
Specialty
Products, EUR
million 254.0 260.5 241.5 252.5 218.7 233.3
Publisher:
Orion Corporation
www.orion.fi/en/
Orion is an innovative European R&D-based pharmaceutical and
diagnostic company with a special emphasis on developing medicinal
treatments and diagnostic tests for global markets. Orion develops,
manufactures and markets human and veterinary pharmaceuticals, active
pharmaceutical ingredients and diagnostic tests. Orion's
pharmaceutical R&D focuses on the following core therapy areas:
central nervous system drugs, cancer and critical care drugs, and
Easyhaler® pulmonary drugs.
The Group's net sales in 2008 amounted to EUR 711 million. The
Company invested EUR 90 million in research and development. At the
end of 2008, the Group had a total of 3,300 employees, of whom 2,700
worked in Finland and 600 in other European countries. Orion's A and
B shares are listed on NASDAQ OMX Helsinki.
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