Ion Beam Applications, SA

Annual / Quarterly Financial Statement • Aug 31, 2011

IBA - International Financial Reporting Standards (IFRS) − Interim Condensed Consolidated Financial Statements for the six months ended June 30, 2011

Ion Beam Applications ("IBA")

IFRS Interim Condensed Consolidated Financial Statements for the six months ended June 30, 2011

IFRS Interim Condensed Consolidated Financial Statements

In accordance with IAS 34, IBA S.A. has elected to publish its interim consolidated financial statements at June 30, 2011 in a condensed format.

Table of Contents

	General Information 3
	Interim Consolidated Statement of Financial Position as at June 30, 2011 5
	Interim Consolidated Income Statement for the 6 months ended June 30, 2011 6
	Interim Consolidated Statement of Comprehensive Income for the six months ended June 30, 2011 7
	Interim Consolidated Statement of Changes in Shareholders' Equity 8
	Interim Consolidated Statement of Cash Flow for the six months ended June 30, 2011 9
	Notes to the Interim Condensed Consolidated Financial Statements 10
1.	Financial Statements – Basis of preparation 10
2.	Consolidation scope and effects of changes in the composition of the group 12
3.	Critical accounting estimates and judgments 14
4.	Segment information 17
5.	Earnings per share 18
6.	Other selected disclosures 20
7.	Interim Management Report 26
	Auditor's report on the IFRS interim condensed consolidated financial statements at June 30, 2011…… 33

General Information

Ion Beam Applications SA (the "Company" or the "parent"), founded in 1986, and its subsidiaries (together, the "Group" or "IBA") are committed to technological progress in the field of cancer diagnosis and therapy and deliver efficient, dependable solutions providing unequaled precision. IBA also offers innovative solutions for everyday hygiene and safety.

IBA has organized its businesses into two operating segments in order to manage its activities and monitor their financial performance.

• Pharmaceuticals composed of production, development and distribution services for radiopharmaceuticals and bio-assays.
• Equipments forming the technology foundation of the Company's many businesses, including the development, manufacture, and service of medical and industrial particle accelerators, proton therapy systems, and a wide range of dosimetry products and solutions in radiation therapy.

The Company is a limited liability company incorporated and domiciled in Belgium. The address of its registered office is Chemin du Cyclotron, 3, 1348 Louvain-la-Neuve, Belgium.

The Company is listed on the pan-European stock exchange Euronext and is included in the Bel-Small Index.

Consequently, IBA has agreed to follow certain rules to enhance the quality of financial information provided to the market. These include:

• Publication of its annual report, including its audited annual consolidated financial statements, within four months from the end of the financial year;
• Publication of a half-year report covering the first six months of the financial year within two months from the end of the second quarter;
• Publication of half-year and annual consolidated financial statements prepared in accordance with IFRS;
• Audit of its annual consolidated financial statements by its auditors in accordance with the auditing standards set forth by the International Federation of Accountants ("IFAC").

These interim condensed consolidated financial statements have been approved for issue by the Board of Directors on August 26, 2011. The Board of Directors of IBA is composed as follows :

Internal directors: Mr. Pierre Mottet, Mr. Yves Jongen and Bayrime S.A. represented by its Managing Director, Mr. Eric de Lamotte. Mr. Pierre Mottet is the Managing Director and Chief Executive Officer. His mandate was renewed at the Ordinary General Meeting of Shareholders held on May 11, 2011 and will expire at the Ordinary General Meeting of 2015 which will decide on the 2014 financial statements. Mr. Yves Jongen is Managing Director and Chief Research Officer. His mandate was renewed at the Ordinary General Meeting of Shareholders held on May 12, 2010 and will expire at the Ordinary General Meeting of 2013 deciding on the 2012 financial statements. The mandate of Bayrime S.A. represented by Mr. Eric de Lamotte was renewed at the Ordinary General Meeting of Shareholders held on May 11, 2011 and will expire at the Ordinary General Meeting of 2013, deciding on the 2012 financial statements

Independent Directors: PSL Management Consulting S.C.S. represented by Mr. Pierre Scalliet, its Managing Director, and Windi S.P.R.L. represented by Mr. Yves Windelincx, its Managing Director and Consultance Marcel Miller S.C.S. represented by Mr. Marcel Miller, were nominated as Independent Directors. The mandate of S.C.S. PSL Management Consulting represented by Mr. Pierre Scalliet, its General Manager was renewed at the Ordinary General Meeting of Shareholders of May 13, 2009 and will expire at the Ordinary General Meeting of 2012 deciding on the 2011 financial statements. The mandate of Windi SPRL represented by Mr. Yves Windelincx was approved at the Ordinary General Meeting of Shareholders on May 11, 2011 and will expire at the Ordinary General Meeting of 2015 deciding on the 2014 financial statements. The mandate of S.C.S. Consultance Marcel Miller started on May 11, 2011 and will expire at the Ordinary General Meeting of Shareholders of 2012 deciding on the 2011 financial statements.

Other directors: Innosté S.A. represented by Mr. Jean Stéphenne, the Institut National des Radioéléments represented by Ms. Nicole Destexhe its Chief Financial Officer and Olivier Ralet BDM S.P.R.L. represented by its Managing Director, Mr. Olivier Ralet. The mandate of Mr. Peter Vermeeren ended at the Ordinary General Meeting of Shareholders of 2011, deciding on the 2010 financial statements. The mandate of Innosté S.A. was renewed at the Ordinary General Meeting of Shareholders held on May 11, 2011, and will expire at the Ordinary General Meeting of Shareholders of 2013, deciding on the 2012 financial statements. The mandate of the IRE was renewed at the Ordinary General Meeting of Shareholders of May 12, 2010 and will expire at the Ordinary General Meeting of Shareholders of 2013, deciding on the 2012 financial statements. The mandate of Olivier Ralet BDM S.P.R.L. represented by Mr. Olivier Ralet was renewed at the Ordinary General Meeting of Shareholders of May 13, 2009 and will expire at the Ordinary General Meeting of Shareholders of 2012 deciding on the 2011 financial statements.

The Board of Directors of IBA operates within the guidelines defined in its Charter of Corporate Governance as approved by the Board session of April 1st, 2010. A copy of it can be found on the IBA website (www.iba-worldwide.com).

Interim Consolidated Statement of Financial Position as at June 30, 2011

The Group has chosen to present its statement of financial position on a current/ non-current basis. The notes on pages 11 to 25 are part of those interim condensed consolidated financial statements.

	Note	June 30, 2011	December 31, 2010
		(EUR '000)	(EUR '000)
ASSETS
Goodwill	6.3	29 631	31 492
Other intangible assets	6.3	40 985	40 916
Property, plant and equipment	6.3	84 972	86 429
Investments accounted for using the equity method		11 533	8 255
Other investments		2 965	1 943
Deferred tax assets		30 923	31 877
Derivative financial instruments		589	0
Other long-term receivables Non-current assets		96 238 297 836	90 429 291 341
Inventories and contracts in progress	6.5	110 671	102 694
Accounts receivable		82 748	89 249
Other receivables		34 172	25 286
Derivative financial instruments Assets		2 197	1 535
Cash and cash equivalents	6.2	40 137	18 102
Current assets		269 925	236 866
TOTAL ASSETS		567 761	528 207
EQUITY AND LIABILITIES
Share capital	6.8	38 005	37 888
Share premium	6.8	125 799	125 421
Treasury shares	6.8	-8 655	-8 655
Hedging and other reserves		13 873	9 878
Cumulative translation differences		-17 153	-9 948
Retained earnings		-5 337	-3 269
Capital and reserves attributable to Company's equity holders		146 532	151 315
Non-controlling interests		1 061	1 087
TOTAL EQUITY		147 593	152 402
Borrowings	6.4	39 455	39 943
Derivative financial instruments Liabilities		369	344
Deferred tax liabilities		923	948
Long-term provisions		85 023	87 191
Other long-term liabilities		39 869	43 861
Non-current liabilities		165 639	172 287
Short-term provisions		11 544	11 812
Borrowings	6.4	3 561	5 115
Other short-term financial liabilities		751	751
Accounts payable		61 145	63 412
Current income tax liabilities		1 542	2 384
Other payables and accruals	6.6	175 986	120 044
Current liabilities		254 529	203 518
TOTAL LIABILITIES		420 168	375 805
TOTAL EQUITY & LIABILITIES		567 761	528 207

Interim Consolidated Income Statement for the 6 months ended June 30, 2011

The Group has chosen to present its income statement by function of expenses. The notes on pages 11 to 25 are an integral part of these IFRS interim condensed financial statements.

	Note	June 30, 2011	June 30, 2010
		(EUR '000)	(EUR '000)
Sales and contract revenue		199 172	181 306
Cost of sales and contract costs		126 016	108 702
Gross profit		73 156	72 604
Selling and marketing expenses		20 894	20 000
General and administrative expenses		32 690	31 042
Research and development expenses		15 277	12 926
Other operating expenses	6.7	2 829	6 798
Other operating (income)	6.7	-6 231	-1 681
Finance expenses		19 975	9 504
Finance (income)		-16 544	-9 645
Share of (profit)/loss of companies consolidated using equity method		- 799	- 849
Profit before tax		5 065	4 509
Tax (income)/ expense	6.10	1 795	1 959
Profit for the period from continuing operations		3 270	2 550
Profit/ (loss) for the period from discontinued operations		0	0
Profit for the year		3 270	2 550
Attributable to :
Equity holders of the parent		3 083	2 308
Minority interest		187	242
Earnings per share from continuing and discontinued operations (€ per share)
- basic		0.12	0.09
- diluted		0.12	0.09
Earnings per share from continuing operations (€ per share)
- basic		0.12	0.09
- diluted		0.12	0.09

Interim Consolidated Statement of Comprehensive Income for the six months ended June 30, 2011

	June 30, 2011	June 30, 2010
	(EUR '000)	(EUR '000)
Income/(expenses) for the period	3 270	2 550
Changes in available-for-sale financial asset reserves	- 359	131
Changes in strategic hedge reserves	2 516	-6 202
Changes in currency translation difference	-7 205	13 579
Net income/(expenses) recognized directly in equity	-5 048	7 508
Comprehensive income	-1 778	10 058
Attributable to :
Equity holders of the parent	-1 965	9 816
Non-controlling interests	187	242

As the Group has substantial available tax losses, no deferred tax impact has been calculated on the elements debited or credited directly to comprehensive income.

Interim Consolidated Statement of Changes in Shareholders' Equity

Cumulative Share Treasury Hedging Other Retained Share premium translation Interests capital shares reserve reserves earnings differences Balance at 1 January 2010 37 505 124 788 -9 515 1 755 14 322 -16 377 -9 117 781 144 142 Profit/(loss) for the period 0 0 0 -6 202 131 13 579 0 0 7 508 Comprehensive income for the period 0 0 0 0 0 0 2 308 242 2 550 Employee share option scheme : 0 0 0 -6 202 131 13 579 2 308 242 10 058 Dividends 0 0 0 0 0 0 0 0 0 Employee stock options & share based payment 0 0 0 0 - 274 0 0 0 - 274 Purchase & sale of treasury shares 0 0 858 0 0 0 - 491 0 367 Other changes in non-controlling interests 0 0 0 0 0 0 0 0 0 Other movements 0 0 0 0 0 0 0 0 0 Increase/(reduction) of capital stock/capital surplus 216 355 0 0 0 0 0 0 571 Balance at 30 June 2010 37 721 125 143 -8 657 -4 447 14 179 -2 798 -7 300 1 023 154 864 Balance at 1 January 2011 37 888 125 421 -8 655 -1 177 11 055 -9 948 -3 269 1 087 152 402 Profit/(loss) for the period 0 0 0 2 516 - 359 -7 205 0 0 -5 048 Comprehensive income for the period 0 0 0 0 0 0 3 083 187 3 270 Employee share option scheme : 0 0 0 2 516 - 359 -7 205 3 083 187 -1 778 Dividends 0 0 0 0 0 0 -4 020 0 -4 020 Employee stock options & share based payment 0 0 0 0 707 0 0 0 707 Purchase & sale of treasury shares 0 0 0 0 0 0 0 0 0 Other changes in non-controlling interests 0 0 0 0 0 0 - 213 - 213 0 Other movements 0 0 0 0 1 131 0 -1 131 0 0 Increase/(reduction) of capital stock/capital surplus 117 378 0 0 0 0 0 0 495					Attribuable to equity holders of the parent				Non controlling	Equity
	Balance at 30 June 2011	38 005	125 799	-8 655	1 339	12 534	-17 153	-5 337	1 061	147 593

Interim Consolidated Statement of Cash Flow for the six months ended June 30, 2011

The Group has chosen to present the cash flow statement using the indirect method. The notes on pages 11 to 25 are part of those interim condensed consolidated financial statements.

	June 30, 2011	June 30, 2010
	(EUR '000)	(EUR '000)
CASH FLOW OPERATING ACTIVITIES
Net profit/(loss) for the period	3 083	2 308
Adjustments for:
Depreciation and impairment of perty, plant, and equipment	6 900	8 275
Amortization and impairment of intangible assets	1 960	2 787
Write-off on receivables	190	215
Changes in fair values of financial assets (gains)/losses	1 289	- 732
Change in provisions	- 400	3 101
Taxes	308	225
Share of results of associates and joint ventures accounted for using the equity method	- 799	- 849
Other non-cash items	849	866
Net profit/(loss) before changes in working capital	13 380	16 196
Trade receivables, other receivables, and deferrals	-3 505	-14 951
Inventories and contract in progress	41 632	2 513
Trade payables, other payables, abd accruals	759	-4 782
Changes in working capital	38 886	-17 220
Income tax paid / received, net	0	0
Interest expenses	684	715
Interest income	-1 043	-1 180
Net cash (used in)/generated from operations	51 907	-1 489
CASH FLOW FROM INVESTING ACTIVITIES
Acquisitions of property, plan and equipment	-7 768	-9 670
Acquisitions of intangibles assets	-2 599	-1 000
Disposals of assets	30	112
Acquisitions of subsidiaries, net of acquired cash	0	0
Acquisitions of third party and equity-accounted compagnies	-3 651	- 206
Acquisitions of non-current financial assets and loan granted	0	-7 951
Other investing cash-flows	-8 112	-3 116
Net cash (used in)/generated from investing activities	-22 100	-21 831
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from borrowings	178	36 643
Repayments of borrowings	-2 879	-3 153
Interest paid/received net	- 431	- 672
Capital increase (or proceeds from issuance of ordinary shares)	477	547
Purchase of treasury shares	0	- 595
Dividends paid	-4 019	- 4
Other financing cash flows	- 57	211
Net cash (used in)/generated from financing activities	-6 731	32 977
Net cash and cash equivalents at the beginning of the period	18 102	17 586
Change in the net cash and cash equivalents	23 076	9 657
Exchange gains/(losses) on cash and cash equivalents	-1 041	- 621
Net cash and cash equivalents at the end of the period	40 137	26 622

Notes to the Interim Condensed Consolidated Financial Statements

1. Financial Statements – Basis of preparation

1.1 Basis of preparation

These interim condensed consolidated financial statements of IBA are for the six months period ended June 30, 2011. They have been prepared in accordance with IAS 34 "Interim Financial Reporting".

The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual financial statements as at 31 December 2010.

1.2 Changes to accounting policies

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the Group's annual financial statements for the year ended 31 December 2010, except for the adoption of new Standards and Interpretations as of 1 January 2011, noted below.

a) Recently issued IFRS

To the extent that new IFRS requirements are expected to be applicable in the future, they have been summarized hereafter. For the six-month period ended 30 June 2011, they have not been applied in preparing these unaudited condensed consolidated interim financial statements.

Standards related to the consolidation of the financial statements:

• IFRS 10 Consolidated Financial Statements , which replaces IAS 27 and SIC-12;
• IFRS 11 Joint Arrangements;
• IFRS 12 Disclosure of Interests in Other Entities;
• IAS 27 (Revised 2011), which has been amended for the issuance of IFRS 10 but retains the current guidance on separate financial statements;
• IAS 28 (Revised 2011), which has been amended for conforming changes on the basis of the issuance of IFRS 10 and IFRS 11.

Other Standards:

• IFRS 9 Financial Instruments;
• IFRS 13 Fair Value Measurement;
• IAS 19 Revised: Employee Benefits.

These standards become mandatory for IBA's 2013 consolidated financial statements. IBA is in the process of evaluating the impact of these new standards. It is anticipated that their application will not have a material impact on IBA consolidated financial statements in the period of initial application.

A number of other new standards, amendment to standards and new interpretations became mandatory for the first time for the financial year beginning 1 January 2011, and have not been listed in these unaudited condensed consolidated interim financial statements because of either their non-applicability to or their immateriality to IBA's consolidated financial statements.

1.3 Translation of financial statements of foreign operations

All assets (including goodwill) and liabilities, both monetary and non-monetary, are translated at the closing rate. Income and expenses are translated at the rate of the date of the transaction (historical exchange rate) or at an average rate for the month.

The principal exchange rates that have been used are as follows:

	2011		2010
	Closing rate at end June	Average rate for the 6 months period	Closing rate at end December	Average rate for the year
USD	1.4390	1.4028	1.3252	1.3280
SEK	9.2152	8.9374	8.9929	9.5586
GBP	0.8982	0.8677	0.8566	0.8585
CNY	9.3108	9.1690	8.7351	8.9893
INR	65.2350	63.5782	60.0564	60.9806
JPY	116.5270	115.5955	108.1930	116.6139

	2011		2010
	Closing rate at end June	Average rate for the 6 months period	Closing rate at end December	Average rate for the year
USD	1.4390	1.4028	1.3252	1.3280
SEK	9.2152	8.9374	8.9929	9.5586
GBP	0.8982	0.8677	0.8566	0.8585
CNY	9.3108	9.1690	8.7351	8.9893
INR	65.2350	63.5782	60.0564	60.9806
JPY	116.5270	115.5955	108.1930	116.6139

2. Consolidation scope and effects of changes in the composition of the group

IBA Group consists of IBA S.A. and a total of 44 companies and associated companies in 15 countries. Of these, 35 are fully consolidated and 9 are accounted for using the equity method. The group has elected not to use the proportional method for any subsidiaries.

2.1 List of companies consolidated in IBA Group

Name	Country of incorporation	Share of equity held (%)	Variation in % held compared to 31 December 2010
IBA Molecular Holding (BE 0880.070.706)	Belgique	100%	-
IBA Pharma S.A. (BE 0860.215.596)	Belgique	100%	+0,1%
IBA Pharma Invest S.A. (BE 0874.830.726)	Belgique	68,75%	+0,07%
IBA Participations S.P.R.L. (BE 0465.843.290)	Belgique	100%	-
IBA Investments S.C.R.L. (BE 0471.701.397)	Belgique	100%	-
IBA Corporate Services S.A. (BE 0471.889.261)	Belgique	100%	-
Molecular Imaging S.A. (BE 0819.674.051)	Belgique	100%	+0,1%
Ion Beam Beijing Medical Appliance Technology Service Co. Ltd.	Chine	100%	-
Ion Beam Applications Co. Ltd.	Chine	100%	-
IBA RadioIsotopes France S.A.S.	France	100%	+0,1%
IBA Dosimetry Gmbh	Allemagne	100%	-
IBA Molecular Imaging (India) Pvt. Ltd.	Inde	68,75%	+0,07%
IBA RadioIsotopi Italia S.r.L.	Italie	100%	+0,1%
IBA Molecular Spain S.A.	Espagne	100%	+0,1%
MediFlash Holding A.B.	Suède	100%	-
IBA Molecular UK limited	Royaume-Uni	100%	+0,1%
IBA Dosimetry North America Inc.	Etats-Unis	100%	-
IBA Proton Therapy Inc.	Etats-Unis	100%	-
IBA Industrial Inc.	Etats-Unis	100%	-
IBA Molecular North America Inc.	Etats-Unis	100%	+0,1%
RadioMed Corporation	Etats-Unis	100%	-
IBA USA Inc.	Etats-Unis	100%	-
IBA Molecular Montreal Holding Corp.	Etats-Unis	100%	-
BetaPlus Pharma S.A. (BE 0479.037.569)	Belgique	75%	+0,07%
IBA Particle Therapy Gmbh	Allemagne	100%	-
Radiopharma Partners S.A. (BE 0879.656.475)	Belgique	100%	+0,1%
CIS Bio International S.A.S.	France	100%	+0,1%
Cis Bio Spa	Italie	100%	+0,1%
Cis Bio Gmbh	Allemagne	100%	+0,1%
Cis Bio US Inc.	Etats-Unis	100%	+0,1%
IBA Bio Assays S.A.S.	France	100%	+0,1%
IBA Molypharma S.L.	Espagne	100%	+0,1%
PetLinq L.L.C.	Etats-Unis	100%	-
IBA Hadronthérapie S.A.S.	France	100%	-
Cyclhad S.A.S.	France	60%	-

IBA - International Financial Reporting Standards (IFRS) − Interim Condensed Consolidated Financial Statements for the six months ended June 30, 2011

Name	Country of incorporation	Share of equity held in (%)	Variation in % held compared to 31 December 2010
Striba Gmbh	Allemagne	50%	-
Pharmalogic Pet Services of Montreal Cie	Canada	48%	-
Radio Isotope Méditerranée	Maroc	25%	-
Molypharma	Espagne	24,5%	-
Swan Isotopen AG	Suisse	20,2%	-
Sceti Medical Labo KK	Japon	39,8%	-
Bio Molecular Industries SDN	Malaisie	36,83%	-
Petnet GmbH	Allemagne	25.20%	25.20%
Petnet Solutions AG	Allemagne	25.20%	25.20%

2.2 Equity-accounted investments

2.3 Changes in the composition of IBA Group

In April 2011, IBA acquired an investment of 25.2% in the German companies PETNET GmbH and PETNET Solutions AG for an amount between € 2.5 and 3 million. Since then, these two entities are accounted for using the equity method. IBA is currently in the process of the purchase price allocation.

3. Critical accounting estimates and judgments

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

3.1 Income taxes

The Group has accumulated net operating losses useable to offset future taxable profits essentially in Belgium, France, Italy, Spain, United Kingdom and the United States for € 185 million and for temporary differences amounting to € 90 million at June 30, 2011. The company has recognized deferred tax assets amounting to € 30.9 million on net operating losses at June 30, 2011. The valuation of these assets depends on a number of judgmental assumptions regarding the future probable taxable profits of different group subsidiaries in different jurisdictions. These estimates are made prudently in the limit of the best current knowledge. Where circumstances should change and the final tax outcome would be different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax assets in the period in which such determination is made.

The Group recognizes deferred tax assets on unused tax losses carried forward to the extent that taxable profit will be available against which these assets can be utilized. Estimates of the amount recognizable on the balance sheet are established prudently based on the most recent financial information available from Management and depend on certain judgmental assumptions regarding the future taxable profits of the Group's subsidiaries. The Group's Pharmaceutical business is currently in a phase of heavy investment in research and development of new molecules, with future profits only being generated over a longer period of time. In order to take into account this change in the profile of IBA's business, the Board had decided to extend the period over which estimated taxable profits are considered for recognition of deferred tax assets, from 4 years to 5 years for the pharmaceutical business only - the rule remained unchanged for the equipment business. At June 30, 2011, the estimate of future taxable profits has been considered for a period of 3.5 years for the Equipment business and 4.5 years for the pharmaceutical business.

3.2 Provision for decommissioning costs

The production of Radiopharmaceuticals tracers (Pharmaceutical business segment) generates radiation and results in the contamination of the production site facilities. This situation may require the Group to pay restoration costs to comply with the regulations in these various jurisdictions, as well as with any legal or constructive obligations.

Analysis and estimates are performed by the Group, together with its legal advisers, in order to determine the probability, timing and amount involved with probable required outflow of resources.

Provision has been made for unavoidable costs in connection with decommissioning the sites where radiopharmaceutical agents are produced. These provisions are measured at the net present value of the best estimate of the necessary costs.

At June 30, 2011 the amount of such provisions amounts to € 40.2 million compared to € 39.1 million at December 31, 2010.

The French subsidiary CIS Bio International SAS has held nuclear operator status since December 2008 and as such is required to set aside restricted assets for the future decommissioning and restoration of the nuclear medicine facilities at the site in Saclay, France. At June 30, 2011, these restricted assets amounted to € 33.9 million, compared with € 33.6 million at December 31, 2010.

3.3 Provisions for obligation to take over radioactive equipment and sources

In the context of the gradual disengagement from radioactive source production (production of cobalt and cesium) at the Saclay site in France, a provision has been made to meet obligations for the takeover and disposal of used radioactive sources and certain equipment (irradiators) in France. This provision is valued at the net present value of the most probable estimates of unavoidable costs for the treatment and disposal of these used sources. This provision is discounted based on the estimated plan for source recovery.

At June 30, 2011 the amount of such provisions amounts to € 14.6 million compared to € 16.4 million at December 31, 2010.

3.4 Revenue recognition

Contracts in progress are valued at their cost of production, increased by income accrued as determinate by the stage of completion of the contract activity at the balance sheet date, to the extent that it is probable that the economic benefits associated with the contract will flow to the Group. This probability is based on judgment. If certain judgmental criteria differ from those used for previously recognized revenues, the Group's income statement is impacted.

When appropriate, the company revises its estimated margin at completion to take into account the assessment of any residual risk arising from this contract over several years. When the final outcome of these uncertainties differs from initial estimations, the Group's income statement is impacted.

3.5 Defined benefit plans

Under defined benefit plans, an employer's obligation is to provide the agreed benefits to current and former employees. The benefits are typically based on such factors as age, length of service and compensation. The actuarial risks and investment risks are retained by the employer. If actuarial or investment experience is different than expected, an employer's obligation may be increased or decreased. Such engagements should be valued and recognized on the balance sheet under IFRS.

Actuarial gains and losses are presented under other comprehensive income.

At June 30, 2011 the amount of provisions for defined benefit plans amounts to € 24.7 million.

The valuation of this provision, based on estimates and judgments made by the Group, is subject to the recurring revision by an external actuarial consultant.

3.6 Estimating the value in use of intangible and tangible fixed assets

The recoverable amounts of tangible and intangible fixed assets are determined on a "value in use" basis. Value in use is determined on the basis of IBA's most recent business plans, as approved by the Board of Directors. These plans incorporate various assumptions made by management and approved by the Board as to how the business, profit margins, and investments will evolve.

3.7 Valuation of private equity instruments

IBA revalues its private equity holdings using either the discounted cash flow method or the share value assigned to them during the most recent rounds of financing.

3.8 Development costs for new molecules

Expenses incurred to prepare the Group's facilities for the future commercialization of new molecules in phase 2 or phase 3 of development are recognized as tangible and intangible assets when management considers it likely that such molecules can be brought to market and that future revenues will offset the development costs incurred. At June 30, 2011, these capitalized expenses stood at EUR 8 million.

4. Segment information

For management purposes, the Group is organized on a worldwide basis into two main operating segments: (1) Equipment and (2) Pharmaceuticals (i.e. businesses related to the radiopharmaceuticals and bio-assays).

The table below provides details of the income statement for each segment. All inter-segment sales are contracted at arms' length.

Six months ended June, 30 2011	EQUIPMENT	PHARMACEUTICALS	GROUP
	(EUR '000)	(EUR '000)	(EUR '000)
Net s ales	91 334	109 410	200 744
Inter-segment sales	- 753	- 819	-1 572
External sales	90 581	108 591	199 172
Segment results	6 584	2 616	9 200
Unal located expenses			-1 504
Fi ananci al income/(expenses )			-3 430
Share of profit/(loss ) of compa nies consol idated usi ng equity method			799
Profit before tax			5 065
Tax (expense)/income			-1 795
Profit for the period from dis continued operations			0
PROFIT FOR THE PERIOD			3 270

Six months ended June, 30 2010	EQUIPMENT	PHARMACEUTICALS	GROUP
	(EUR '000)	(EUR '000)	(EUR '000)
Net s ales	72 187	109 544	181 731
Inter-segment sales	- 109	- 316	- 425
External sales	72 078	109 228	181 306
Segment results	6 289	-2 076	4 231
Unal located expenses			- 694
Fi ananci al income/(expenses )			141
Share of profit/(loss ) of compa nies consol idated usi ng equity method			849
Profit before tax			4 527
Tax (expense)/income			-1 959
Profit for the period from dis continued operations			0
RESULTAT DE LA PERIODE			2 550

5. Earnings per share

5.1 Basic

Basic earnings per share are calculated by dividing the net profit attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the period. The weighted average number of ordinary shares excludes shares purchased by the Company and held as treasury shares.

BASIC EPS	June 30, 2011 (EUR '000)	June 30, 2010 (EUR '000)
Weighted average number of ordinary shares	26,327,937	26 167 788
Earnings attribuable to equity holders of the parent (€' 000)	3,083	2 308
Basic earnings per share from continuing and discontinued operations (€ per share)	0.12	0.09
Earnings from continuing operations attribuable to equity holders of the parent (€' 000)	3,083	2 308
Weighted average number of ordinary shares in issue	26,327,937	26 167 788
Basic earnings per share from continuing operations (€ per share)	0.12	0.09
Earnings from discontinued operations attribuable to equity holders of the parent (€' 000)	-	0
Weighted average number of ordinary shares in issue	26,327,937	26 167 788
Basic earnings per share from discontinued operations (€ per share)	0.00	0.00

5.2 Diluted

Diluted earnings per share are calculated adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. The Company has only one category of dilutive potential ordinary shares: share options.

The calculation is performed for the share options to determine the number of shares that could have been acquired at fair value (determined as the average annual market share price of the Company's shares) based on the monetary value of the subscription rights attached to outstanding share options. The number of shares calculated as above is compared with the number of shares that would have been issued assuming the exercise of the share options.

IBA - International Financial Reporting Standards (IFRS) − Interim Condensed Consolidated Financial Statements for the six months ended June 30, 2011

DILUTED EPS	30 juin 2011	30 juin 2010
	(EUR '000)	(EUR '000)
Weighted average number of ordinary shares	26,327,937	26 167 788
Weighted average number of sotck options	842,117	907 637
Average share price over period	8.15	8.04
Dilution effect from weighted number of stock options	461,676	475 597
Weighted average number of ordinary shares for diluted earnings per share	26,789,612	26 643 385
Earnings attributable to equity holders of the parent (€ '000)	3,083	2 308
Diluted earnings per share from continuing and discontinued operations (€ per share)	0.12	0.09
Earnings from continuing operations attributable to equity holders of the parent (€ '000)	3,083	2 308
Diluted earnings per share from continuing operations (€ per share)	0.12	0.09
Earnings from discontinued operations attributable to equity holders of the parent (€ '000)	0	0
Basic earnings per share from discontinued operations (€ per share)	0.00	0.00

6. Other selected disclosures

6.1 Seasonality or cyclicality of interim operations

IBA's business is not affected by seasonality or cyclical effects.

6.2 Cash and cash equivalent

For the purpose of interim consolidated cash flow statement, cash and cash equivalents are comprised of the following:

	June 30, 2011 (EUR '000)	December 31, 2010 (EUR '000)
Cas h at bank and in hand	30 779	23 587
Res tricted cas h	80	151
Short-term bank depos its and commercial paper	9 278	2 884
	40 137	26 622

6.3 Capital expenditure and commitments

Six months ended 30 June 2011	Property, plant and equipment	Intangible	Goodwill
	(EUR '000)	(EUR '000)	(EUR '000)
Opening net book amount	86 429	40 916	31 492
Addi ti ons	7 768	2 599	0
Di sposals	- 19	- 11	0
Transfer	195	- 195	0
CTA	-2 501	- 364	-1 861
change i n consoli dation scope	0	0	0
Depreciati on/amortisation and impairment	-6 900	-1 960	0
Closing net book amount	84 972	40 985	29 631

6.4 Movements in borrowings

	June 30, 2011	December 31, 2010
	(EUR '000)	(EUR '000)
Current	3 561	5 115
Non-current	39 455	39 943
Total	43 016	45 058
Opening amount	45 058	34 647
New borrowing	848	38 224
Repayments of borrowings	-1 894	-5 999
Transfer	0	2
Entry in consolidation scope	0	34
Exit of consolidation scope	0	0
Increase/(decrease) bank short-term loans	- 985	-22 013
Currency translation difference	- 11	163
Closing amount	43 016	45 058

(1) The amount of new borrowings includes € 0.7 million of non-cash interest charges

The Group has credit lines totaling EUR 100 million including a long-term credit facility of € 50 million from the EIB (European Investment Bank) to provide financing for research and development projects. Under the terms of the facility, the Group agreed to comply with specific covenants regarding the Group's debt. To date, 15% of these credit lines have been utilized.

In addition, in the context of its proton therapy contracts, IBA holds a manufacturing credit facility of EUR 60 million of which EUR 20.8 million has been utilized to date.

6.5 Inventory and construction contracts

	June 30, 2011	December 31, 2010
	(EUR '000)	(EUR '000)
Raw material and supplies	46 227	40 366
Finished products	6 385	7 265
Work in progress	12 985	13 511
Contracts in progress (in excess of billing)	52 803	49 268
Wri te-off on i nventories and contracts in progress	-7 729	-7 716
Inventories and contracts in progress	110 671	102 694

IBA - International Financial Reporting Standards (IFRS) − Interim Condensed Consolidated Financial Statements for the six months ended June 30, 2011

Contracts in progress (in excess of billing)	June 30, 2011 (EUR '000)	December 31, 2010 (EUR '000)
Costs to date and recognized profi t	267 341	250 803
Less: progress billings	-214 538	-201 535
Contracts in progress (in excess of billing)	52 803	49 268
Net amounts due to customers for contract in progress	92 618	42 143

6.6 Other payables and accruals

		June 30, 2011 December 31, 2010
	(EUR '000)	(EUR '000)
Non-trade payables	1 841	4 203
Advances Billing (in excess of CIP)	92 618	42 143
Social debt	20 110	18 454
Accrued expenses	28 967	27 364
Accrued interests expenses	18	196
Deferred income	3 911	4 106
Capital grants	1 479	1 349
Other current liabilities	27 042	22 229
Other payables and accruals	175 986	120 044

6.7 Other operating expenses and income

The other operating expenses of € 2.8 million at June 30, 2011 include the valuation of the stock option plans offered to IBA employees for € 0.7 milion, provisions for potential contractual penalties or expected losses on projects for € 0.5 million based on Management's best estimate of the situation at June 30, 2011, as well as consulting fees (€ 0.7 million) incurred as part of the search for an investment partner for the pharmaceutical business and other expenses for € 0.94 million.

The other operating income for 2011 amounts to € 6.2 million and includes the positive effects of the decision in favor of IBA in its legal dispute with Bayer Schering Pharma AG for € 5.7 million and the reversal of a provision for € 0.2 million as well as other income for € 0.3 million.

	Number of ordinary shares	Capital stock (EUR '000)	(EUR '000)	Capital surplus Treasury shares (EUR '000)	Total (EUR '000)
Closing balance at December 31st, 2010	26 992 015	37 888	125 421	-8 655	154 654
Share options exercised	83 933	117	378	0	495
Sale of treasury shares
Opening balance at June 30th, 2011	27 075 948	38 005	125 799	-8 655	155 149

6.8 Ordinary shares, share premium and treasury shares

6.9 Contingencies

The Group is currently involved in certain legal proceedings. The potential risks connected with these proceedings are deemed to be insignificant or unquantifiable or, where potential damages are quantifiable, adequately covered by provisions. Developments in litigation pending at end 2010 mentioned in the 2010 annual report are presented in this Note.

a) Litigation with Bayer Schering Pharma AG

During the first semester, the arbitral proceedings against Bayer Schering AG conducted through the AFA (Association Française d'Arbitrage) ended in favor of IBA. As a reminder, in the context of the acquisition of CIS Bio International S.A.S., the parties had agreed that Bayer Schering Pharma AG would pay an additional EUR 4 million in the event that CISBIO obtained the BNF (Basic Nuclear Facility) designation before December 31, 2008. This amount was intended to help CISBIO to set aside the reserves required by law of all BNF-designated facilities to cover any costs for decommissioning their facilities. A French decree of December 15, 2008 conferred BNF status on CISBIO, and Bayer Schering Pharma AG was asked for the EUR 4 million. Bayer Schering Pharma AG refused to pay on the pretext that the law allows the use of means other than cash to establish the guarantee and that its contractual commitment applied only in the case of a mandatory cash reserve. IBA believed that Bayer Schering Pharma AG had no basis for its position and instituted arbitration proceedings for payment through AFA (Association Française d'Arbitrage, French Arbitration Association). The arbitrating authorities finally agreed with IBA and ordered the payment by Bayer to IBA.

Moreover, as part of the takeover of the Japanese activities of the company, the two parties were involved in a legal dispute as Bayer claimed that IBA and the IRE had not respected their obligation as to « reasonable best efforts » in order to guarantee the transfer of the employees concerned by the takeover. In its counterclaim, as part of the arbitration proceedings mentioned above, Bayer claimed payment of YEN 180 076 111 and € 200 000 as severance pay for the employees involved. On this point too, the arbitrating authorities were of the opinion that IBA had accomplished reasonable best efforts and that if only 20 out of the 38 employees had joined IBA, it was due to elements solely attributable to Bayer. As a result, in the framework of these two demands, Bayer was sentenced to pay € 4 million To IBA.

b) Arbitrage initiated against the Westdeutsches Protonentherapiezentrum Essen GmbH

In November 2009, STRIBA Protonentherapiezentrum GmbH, a 50% affiliate of IBA S.A initiated an arbitration procedure against the Westdeutsches Protonentherapiezentrum Essen GmbH ("WPE") in order to determine the exact scope of Striba's contractual obligations under that Public Private Partnership for the delivery of a turnkey Proton therapy center in Essen, Germany.

WPE is disputing the quality of the software equipment for the Proton Therapy Patient Management System proposed by IBA claiming that this system does not represent the latest technology for the treatment of the mobile tumors. IBA introduced the arbitration to get a confirmation (i) that the proposed system is a state of the art system and satisfies the requirements of the functional description of the specification of services relating to the treatment of movable tumors, both in terms of the treatment quality, as well as in terms of the speed of treatment, (ii) that WPE is not entitled to a reduction in leasing fees and (iii) that it be determined that the costs for the development of the Proton Therapy Patient Management System proposed by IBA, to the extent that said costs exceed the budget provided in the Leasing Agreement, be borne by WPE.

Further to this, WPE introduced several other claims against STRIBA, in particular (i) the payment of contractual penalties for delay, (ii) a demand to carry out acceptance tests in addition to those stipulated in the contract, (iii), that the clinical commissioning of the centre be finalized before the start of the rental period (and the payment of the rent) and (iv) several other detailed technical demands with respect to both the equipment delivered by IBA as well as the building. The centre is now complete and has been presented for acceptance by STRIBA to WPE on June 30, 2011. However it appears that WPE may not have the financial means to pay the rent during the clinical commissioning and start-up phase of the centre. The arbitrage proceedings, which had been suspended in order for the parties to find a global agreement on the disputed items, were resumed during the first semester. The next proceedings are expected in September 2011.

6.10 Income tax

	June 30, 2011 (EUR '000)	December 31, 2010 (EUR '000)
Current taxes	1 487	1 729
Deferred taxes	308	230
Total	1 795	1 959

6.11 Dividends paid and proposed

The distribution of a dividend of € 4 million was proposed and accepted by the Ordinary General Meeting of Shareholders held on May 11, 2011. The dividend payment was initiated during the first semester of 2011.

7. Interim Management Report

7.1 Figures and significant events:

	H1 2011	H1 2010	Variance	Variance
	(EUR 000)	(EUR 000)	(EUR 000)	%
Sales and Services	199,172	181,306	17,866	9.9%
REBITDA	13,671	18,340	-4,669	-25.5%
% of Sales	6.9%	10.1%
REBIT	4,294	8,636	-4,342	-50.3%
% of Sales	2.2%	4.8%
Net profit before tax	5,065	4,509	556	12.3%
% of Sales	2.5%	2.5%
Net result	3,270	2,550	720	28.2%
% of Sales	1.6%	1.4%

• • The 1st half of 2011 was marked by significant growth in Sales and Services driven by the existing order book from year-end 2010 which was further embellished by additional orders made in the 1st first quarter of 2011 in the Equipment segment.
• • As stated in the 2010 year-end guidance, recurring operating income is down significantly compared to the first half of 2010. A large part of this drop can be explained by the investments made as part of the process to change the profile of the Pharmaceutical segment and those aimed at maintaining the leadership of IBA in Proton therapy.
• • The pre-tax profit of EUR 5.1 million is significantly up compared to the first half of 2010.
• In the first half of 2011, pre-tax profit was influenced by EUR 5.7 million by the positive outcome of a legal dispute that had been going on between IBA and Bayer since 2008 following the acquisition of the radiopharmaceutical activity of the latter.
• It is important to remember however, that during the 1st half of 2010, the company recorded exceptional costs primarily due to the accelerated depreciation of fixed assets and provisions for potential contractual penalties.
• • The EUR 3.3 million net result posted is therefore an increase of 28.2% compared to the same period in 2010.
• • At June 30, 2011, the company's backlog stood at more than EUR 256 million showing a steady growth over five consecutive semesters.

IBA - International Financial Reporting Standards (IFRS) − Interim Condensed Consolidated Financial Statements for the six months ended June 30, 2011

• Operating cash flow improved significantly reaching 51.9 million over the first half of 2011. - Net debt amounted to only EUR 2.9 million at June 30, 2011. This represents an improvement of 39 million compared to H1 2010 and 24 million compared to year-end 2010.

7.2 Update on strategic action

At the time of the publication of the 2010 half-yearly and annual reports, the company indicated its desire to pursue initiatives to:

• Bring value to non-strategic activities through sales or mergers:
• Extend the network and speed up the search for synergy with global or local partners to meet the needs of the PET and SPECT markets and increase profitability for IBA.
• Invest in radiopharmaceutical activity using own funds in order to speed up the pace of development of new molecules.

These objectives remain a high priority for the company and various actions have been taken in this regard:

• 1. Valuation of non-strategic activities:
• I. Legal carve-out of of the Bioassay activity from the radiopharmaceutical sector.
• II. Appointment of a new Chairman with a mandate to consolidate the subsidiary's strategy and operational structure and explore options for opening the capital to industrial or financial investors.
• 1. Extension of the network:
• III. Acquisition of a minority equity stake in the Malaysian company BioMolecular in the first half of 2010 in order to produce and distribute FDG
• IV. Acquisition of a minority equity stake (25.2%) in PET Net GmbH and PET Net Solutions AG ("PET Net"), which operates two PET production centres in Erlangen and Regensburg in Germany.
• V. Development of an additional project in the Mumbai region of India.
• 1. Search for specific investors in IBA Pharma S.A.:
• VI. Legal carve-out of the radiopharmaceutical activity from the group activities.
• VII. Signature of an exclusive agreement with UBS bank for the search and evaluation of potential partnerships
• VIII. Preparation of audited IFRS pro-forma financial statements
• IX. Circulation of an information memorandum to a wide selection of potential industrial and financial investors. Discussions are ongoing with a number of investors to date, but may not be concluded until the fourth quarter of 2011.

7.3 Results by activity segment

BREAKDOWN OF CONSOLIDATED TURNOVER BY ACTIVITY

PHARMACEUTICALS

	H1 2011 (EUR 000)	H1 2010 (EUR 000)	Variance (EUR 000)	Variance %
Sales and services	108,591	109,228	-637	-0.6%
- Radiopharmaceuticals	91,363	89,228	2,135	2.4%
- Bioassays	17,228	20,000	-2,772	-13.9%
REBITDA % of Sales	4,718 4.3%	7,542 6.9%	-2,824	-37.4%
REBIT % of Sales	-2,946 -2.7%	212 0.2%	-3,158	-1489.5%
JVs & Investments	799	849	-50	-5.9%
REBIT + JV	-2,147	1,061	-3,208	N/A
% of Sales	-2.0%	1.0%

REBITDA: Recurring earnings before interest, taxes, depreciation and amortization on assets and goodwill. REBIT: Recurring earnings before interest and taxes.

• Overall, the segment does not show any growth in sales and services compared to the same period in the previous year. The main factors to be noted are:

Impact of changes in exchange rates: At constant rate, (principally dollar to euro), growth would have been 1%.

Growth in the sales of radiopharmaceutical products at constant exchange rates:

• US down by 7% mainly due to FDG price erosion.
• Europe and Asia up mainly thanks to the SPECT business.

• Bioassays Sales and Services are down 13.9%

• 5% is accounted for by non-recurring license income received in the first half of 2010.

• The rest results from the weak sales of Drug Discovery products during the first 6 months of the year.
• • The company is pleased that its traditional pharmaceutical activity generated a REBITDA of almost EUR 12 million in the first half of 2011 More than half of the amount was reinvested in the support, pre-marketing, validation and adaptation of sites for new molecules to be launched from 2012.
• • Therefore, in line with the results of the second half of 2010 and as announced in the company guidance, the half-year result is negative for this segment.
• • Taking into account the revenue from joint ventures in which IBA has invested over recent years (mainly in Canada, Japan and Spain), the operational loss comes to EUR 2.1 million, a marked decrease when compared against the profit of EUR 1.1 million recorded in 2010.
• • In the strategic area of the development of new marked molecules, the first half was characterized by the following developments:
• In June 2011, during a joint press conference, IBA and its partner WILEX AG commented on the letter from the FDA following the "Pre-BLA meeting" (preparatory meeting for the introduction of the application for marketing authorization of a pharmaceutical product) for REDECTANE®. In summary, to enable WILEX and IBA to strengthen their case for launching the product on the market, the FDA suggested that an "outcome study" be carried out (study involving the use of the product in the doctor's decision making process). WILEX and IBA both agreed that it is quite logical that this outcome study follows the phase III study, finalized to date. However they suggested that this outcome study should be made during a phase IV trial, i.e. after introduction of the product on the market. Discussions are ongoing with the FDA about this. The FDA also discussed manufacturing process issues and requested that the third lot of the antibody Girentuximab being produced on site at Avid Bioservices, Inc., (Tustin, CA) and be made an integral part of the filing (and not submitted in the course of the approval process as hoped) and also requested additional information on the product characterisation and the validation processes by IBA, responsible for the marking of the antibodies. It is important to remember that the phase 3 trial of on the product showed that the PET/CT associated with REDECTANE® leads to a much better diagnosis than with the CT alone. Currently, IBA continues to adapt its installations in order to enable the product to be launched in the United States and then the rest of the world once authorisations for market release have been received. The next meeting with the FDA on this matter is being prepared. It will focus on the proposed new protocol for further clinical trials designed in collaboration with the Medical Advisory Board.
• As for Aposense®, the other proprietary molecule to which IBA has bought exclusive distribution rights and which makes it possible to analyse the patient's response to cancer treatment more quickly, phase 2 tests are being carried out in the United States as planned.
• • Throughout this half-year, IBA has continued to strengthen and expand its network of production of radiopharmaceuticals used in nuclear imaging. On April 18, the company announced the acquisition of a minority equity stake in PET Net GmbH and PET Net Solutions AG ("PET Net"). According to the agreement, IBA acquired 25.2% of PET Net from its owner Medical Imaging Research Holding GmbH for a cash amount of between EUR 2.5 million and 3 million. PET Net operates two PET production centres in Erlangen and Regensburg in Germany and has marketing authorization for FDG. As a result of this transaction, IBA has the only worldwide PET network, with 57 PET production centres and a state-of-the-art SPECT site. The company can thus directly manage distribution to the United States, Europe and India, and deliver its products to over 60 countries.

EQUIPMENT

	H1 2011 (EUR 000)	H1 2010 (EUR 000)	Variance (EUR 000)	Variance %
Sales and services	90,581	72,078	18,503	25.7%
- Protontherapy	50,106	31,530	18,576	58.9%
- Dosimetry	21,641	22,426	-785	-3.5%
- Accelerators and other	18,834	18,122	712	3.9%
REBITDA	8,952	10,798	-1,846	-17.1%
% of Sales	9.9%	15.0%
REBIT	7,240	8,424	-1,184	-14.1%
% of Sales	8.0%	11.7%

REBITDA: Recurring earnings before interest, taxes, depreciation and amortization of tangible and goodwill. REBIT: Recurring earnings before interest and taxes.

• • Sales and Services for the segment were driven by a strong growth in Proton therapy for which the accumulated order book allows the forecasting of a high level of activity in the coming half-year periods.
• • Operating profits are down compared to the first half of 2010. The following explanations should be taken into account:
• A varied mix of products (software/hardware and large/small systems) over the half-year period.
• A very high margin of 11.7% during the first half of 2010 due to project budget adjustments reflecting the productivity gains of the experience curve. The 2011 first half margin of 8.0% remains higher than the performance of the second half of 2010, which stood at 7.3%.
• As announced in the year-end 2010 guidance, for 2011, IBA forecasts a stabilisation of profit for the Equipment segment which will have to support this year's development costs of Proteus ONE(TM). The published results for this half-year period are in line with this trend.

-Proton therapy

• 2011 began under excellent conditions with one new order and the closing of two others:
• On 17 January 2011 IBA announced that the Carl Gustav Carus University Hospital at Dresden Technical University in Germany had selected IBA for the installation of a Proton therapy centre with a treatment room equipped with an isocentric gantry and a research room. The contract also includes a long-term maintenance agreement.
• On 20 January 2011, the funding of the project commissioned by Seattle Procure Management LLC to install a Proton therapy system in Seattle, WA, USA was finalized.
• On 17 March 2011, during the signing ceremony in Stockholm, IBA announced that the Skandionkliniken, the first cancer centre in Scandinavia devoted to treatment with proton beams, has signed a definitive agreement with IBA for the manufacturing, installation and maintenance of a new proton therapy system. The contract between IBA and Skandionkliniken, which involves the installation of the proton therapy system (2 clinical treatment rooms and 1 research room), is estimated at between EUR 50 and 60 million (including a five-year service contract).
• Currently, IBA is also carrying out construction or installation work at nine other sites, two in the USA and seven in Europe.

-Accelerators

The first half-year period saw the sale of four industrial accelerators and six cyclotrons. This excellent performance compared with the11 accelerators ordered during the entire year 2010, only three of which were in the first half, reflects on the strength of the activity within IBA.

-Dosimetry

After years of growth above that of its market and an extraordinary 2010, the Dosimetry sector showed a slowdown in growth in the first half of 2011 which should be temporary and is partly due to the low level of orders from Japan following the Fukushima disaster that occurred during this period, and partly to a probable seasonal slowdown in orders from India and the United Kingdom.

7.4 Subsequent events

None

7.5 Corporate governance

On the occasion of the 2011 General Meeting of Shareholders, Mr. Marcel Miller was appointed independent director to replace Mr. Peter Vermeeren, Vice-Chairman of the Board, who did not wish to seek re-election after 11 years on IBA's Board of Directors.

7.7 Statement of Directors

This set of condensed financial statements has been prepared by Pierre Mottet (CEO) and Jean-Marc Bothy (CFO). To the best of their knowledge it has been written in compliance with actual accounting standards and gives a true picture of the assets, of the consolidated figures. The interim Management report gives a clear overview of major events and main transactions between entities over the first half of 2011 as well as their impact on the set of interim condensed consolidated financial statements and a description of major risks and uncertainties facing the Group.

Auditor's report on the IFRS interim condensed consolidated financial statements at June 30, 2011