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Biotage

Earnings Release Feb 12, 2013

2894_10-k_2013-02-12_44af01e6-c2ca-41ee-87df-50d5c845e47f.pdf

Earnings Release

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Year-end report January – December 2012

February 12, 2013

Year-end report for 2012

Fourth quarter October - December 2012

  • Group net sales in the fourth quarter 2012 amounted to 113.9 MSEK (116.0), a 1.8 percent decrease. At comparable exchange rates the sales increased by 1.5 percent compared to the corresponding quarter 2011.
  • Operating profit for the quarter amounted to 13.5 MSEK (9.8).
  • The result after tax amounted to 13.6 MSEK (17.2).
  • Earnings per share amounted to 0.19 SEK (0.22).
  • The cash flow from operating activities amounted to 29.9 MSEK (33.2).
  • Net cash at December 31 amounted to 165.4 MSEK, compared to 157.0 MSEK at September 30.
  • During the quarter 1,371,175 own shares were acquired within the framework of the share repurchasing program resolved at the Annual General Meeting 2012. At the balance sheet date December 31, 2012 Biotage held a total of 1,782,906 own shares, acquired for 14,738 KSEK at an average acquisition value of 8.27 SEK per share.
  • After the end of the reported period an additional 1,523,369 own shares have been acquired where after Biotage holds a total of 3,306,275 own shares.

Full year January – December 2012

  • Group net sales in 2012 increased by 8 percent to 462.9 MSEK (428.4). At comparable exchange rates sales increased by 6 percent.
  • Operating profit amounted to 43.8 MSEK (25.1).
  • The result after tax amounted to 38.3 MSEK (32.5).
  • Earnings per share amounted to 0.52 SEK (0.42).
  • The cash flow from operating activities amounted to 67.5 MSEK (94.8).
  • Net cash at December 31 amounted to 165.4 MSEK, compared to 198.4 MSEK at December 31, 2011.
  • In 2012 dividends to the shareholders were paid to the amount of 29.3 MSEK (19.9).
  • A raise of the dividends to shareholders to 0.50 SEK (0.40) per share is proposed.
  • The Board of Directors has established a dividend policy according to which Biotage shall distribute at least 50 percent of the net profit as dividend

Consolidated financial development in brief

Amounts in SEK millions 4 th quarter 4 th quarter Full year Full year
2012 2011 2012 2011
Net sales 113.9 116.0 462.9 428.4
Cost of sales -45.8 -52.2 -191.5 -182.1
Gross profit 68.1 63.9 271.4 246.3
Operating expenses -54.6 -54.1 -227.6 -221.2
Operating profit/loss 13.5 9.8 43.8 25.1
Financial items -3.1 0.9 -5.5 2.9
Profit/loss before tax 10.4 10.7 38.3 28.0
Tax expenses 3.2 -0.9 0.3 -2.0
Profit/loss after tax for
continuing operations 13.6 9.9 38.6 25.9
Profit/loss after tax for
discontinued operations - 7.3 -0.3 6.5
Total profit/loss for the period 13.6 17.2 38.3 32.5
Gross profit margin 59.8% 55.0% 58.6% 57.5%
Operating profit margin 11.9% 8.5% 9.5% 5.9%

Net sales development

Comments by CEO Torben Jörgensen

2012 has been a good year for Biotage with strong sales growth and a considerably improved result. We increased our sales by 8 percent to 463 MSEK and our operating result by 75 percent to 44 MSEK. The great improvement of the result during the year is among other things due to the fact that we have increased the gross margin with more than one percentage at the same time as the sales costs ratio has decreased by more than two percentages. The administrative costs in relation to sales have also decreased.

During the year we achieved a number of important targets in our operations. Among other things we increased the sales of aftermarket products, which accounted for 59 percent of Biotage's total sales in 2012. This is close to our strategic goal of 60 percent. We have also achieved a better balance between the areas of organic and analytical chemistry, which makes us less dependent on the development of the pharma industry. The long-term goal is that these two areas should contribute approximately equally to sales. In 2012 analytical chemistry reached a 43 percent share of our total sales.

During the year we invested in our market organization and strengthened our sales force in the US, Europe and China. China, together with Japan, was the strongest developing market in 2012. Even though China still remains a relatively small market for us it has great future potential. Europe was the best region in terms of sales in the fourth quarter.

However, the year's last quarter did not end totally as we expected. We saw an increasingly hesitant market in general and the sales increase slowed down, primarily concerning instruments and above all in the US and India. We have not been willing to lower our prices more than extremely selectively. This has to some extent affected our sales, but it has also contributed to a gross margin of no less than 59.8 percent in the last quarter. Despite this slow-down we exit the last quarter with an 11.9 percent operating margin.

The product area purification has the biggest sales overall. It is therefore pleasing that this area showed a positive development, in the full year as well as in the last quarter. We have gained market shares above all in the US. A strengthened product offering through an updated version of our purification instrument Isolera and new consumables are contributing factors to these successes.

The product area synthesis did not develop equally well in 2012. We believe that the sales growth for our synthesis instruments, which are primarily used in the development of pharmaceuticals based on small molecules, will remain limited also in the future. For this reason we are investigating several alternative application areas for our microwave technology. One good such example is our peptide synthesis products, which have healthy growth.

Biotage also continues to show good sales growth in consumables for analytical chemistry. We maintain a high pace in the development of new applications, which is a decisive factor for success.

One area where we are making investments for the future is the one today called Industrial Resins, previously called process chemistry. Briefly described, these operations concern the large scale removal of unwanted substances such as pesticides and genotoxins from foodstuffs and pharmaceuticals. The operations are so far carried out in laboratory or pilot scale. In 2012 we completed our plant in Lund, which gives us increased capacity and flexibility in the production of polymers.

Group result, financial position and cash flow

Fourth quarter October - December 2012

Consolidated net sales amounted to 113.9 MSEK compared to 116.0 MSEK the fourth quarter 2011, a decrease by 1.8 percent. At comparable exchange rates sales increased by 1.5 percent. The EU was the single biggest market with 39 percent of the net sales. The US contributed 37 percent, Japan 15 percent, China 4 percent and the rest of the world 5 percent of the net sales.

The Group's gross margin was 59.8 percent (55.0). The gross margin is influenced by variations in product mix, sales channels and the geographic distribution of the sales.

The operating expenses amounted to 54.6 MSEK (54.1). Reduced sales costs and R&D costs compared to the corresponding quarter the previous year were offset by higher administration costs during the period.

The operating result amounted to 13.5 MSEK (9.8) with an 11.9 percent (8.5) operating margin. Net financial income amounted to -3.1 MSEK (0.9). Net financial income for the fourth quarter includes a net effect of -0.7 MSEK concerning currency effects from inter-company items and other financial items that were previously considered to be related to the operations. As a result of the changed assessment the net financial income for the period, compared to the previous assessment, was negatively affected by currency effects to the amount of -0.7 MSEK, while the operating result was positively influenced to the same amount. The reported result after tax thus remains unaffected by this reclassification. The result after tax amounted to 13.6 MSEK (17.2).

The investments amounted to 10.5 MSEK (12.4) and the amortizations to 6.8 MSEK (8.8). 8.2 MSEK (8.8) of the investments were capitalized development costs and 4.3 MSEK (5.6) of the amortizations were amortizations of capitalized development costs. As the result of changed accounting assessments of product life cycles the period's amortizations of capitalized development costs have been reduced by 3.1 MSEK compared to previously applied assessments. A write-down of capitalized development costs has been done to the amount of 0.7 MSEK.

The cash flow from operating activities was 29.9 MSEK (33.2). The difference is primarily due to cash flow from changes in working capital amounting to 10.0 MSEK (14.1).

Full year January – December 2012

Consolidated net sales increased by 8 percent and amounted to 462.9 MSEK in 2012 (428.4). At comparable exchange rates net sales increased by 6 percent. The US was the biggest single market with 38 percent of the net sales. The EU area contributed 34 percent, Japan 18 percent, China 5 percent and the rest of the world 5 percent of the net sales.

The Group's gross margin was 58.6 percent (57.5). Variations in product mix, sales channels and the geographic distribution of sales influence this profitability figure. A favorable product mix contributed to improved profitability the last six months of 2012.

The operating expenses amounted to 227.6 MSEK (221.2). It is primarily the 1.9 MSEK increase in research and development costs and the increase of other operating items, mainly consisting of currency effects on operations-related debts and receivables, to the amount of 2.2 MSEK, that explains the difference between the years. The operating profit amounted to 43.8 MSEK (25.1) with an operating margin of 9.5 percent (5.9).

Net financial income amounted to -5.5 MSEK (2.9). Net financial income includes a net effect of -4.9 MSEK concerning currency effects from inter-company items and other financial items that were previously considered to be related to the operations. As a result of the changed assessment, net financial income for the period was negatively affected by currency effects to the amount of -4.9 MSEK compared to the previous assessment, while the operating result was positively influenced to the same amount. The reported result after tax thus remains unaffected by this reclassification. The result after tax amounted to 38.3 MSEK (32.5).

The investments amounted to 40.3 MSEK (43.8) and the amortizations to 28.6 MSEK (36.0). 27.9 MSEK (27.5) of the investments were capitalized development costs and 16.3 MSEK (21.2) of the amortizations were amortizations of capitalized development costs. As a result of changed accounting assessments of product life cycles this year's amortizations of capitalized development costs have been reduced by 9.6 MSEK compared to previous assessments. Write-downs of capitalized development costs have been made to the amount of 5.4 MSEK.

The cash flow from operating activities amounted to 67.5 MSEK (94.8). During the period decreased other current debts resulted in a cash flow effect of -8.5 MSEK (13.1). Changes in other current receivables affected the cash flow to the amount of -5.7 MSEK (4.0). Reduced accounts receivable and reduced inventories contributed 4.8 MSEK (8.2) and 1.0 MSEK (10.0), respectively.

Balance sheet items

At December 31, 2012 the Group's cash and cash equivalents amounted to 170.9 MSEK, compared to 204.7 MSEK at December 31, 2011. The Group's interest-bearing liabilities amounted to 5.6 MSEK at the end of the reported period, compared to 6.3 MSEK at December 31, 2011. Net cash at December 31, 2012 thus amounted to 165.4 MSEK, compared to 198.4 at December 31, 2011.

The Group reports a total goodwill of 102.1 MSEK at December 31, 2012, compared to 106.1 MSEK at December 31, 2011. The reported goodwill relates to the acquisitions of MIP Technologies AB and two product lines from Caliper Life Sciences Inc. in 2010. This year's change in reported value is due to currency effects.

Other intangible fixed assets amounted to 116.3 MSEK (111.1). Of this sum patents and license rights and other intangible assets from acquisitions totaled 41.0 MSEK (47.4) and capitalized development costs 75.3 MSEK (63.7).

At December 31, 2012 the equity capital amounted to 530.8 MSEK, compared to 563.9 MSEK at December 31, 2011. This year's change in equity capital is attributable to the net result, 38.3 MSEK, dividends to shareholders, -29.3 MSEK, repurchasing of own shares, -35.2 MSEK, and hedging and currency effects at the translation of foreign subsidiaries, -6.9 MSEK.

Divested operations

The result after tax for divested operations amounted to -0.3 MSEK in 2012 (6.5) and refers to currency effects on additional purchase payments from Qiagen for the Biosystems business area divested in 2008. There will be no further items affecting the result relating to this divestment after 2012.

Major events after the reported period

Patent dispute in the US

Biotage has, as previously reported, been sued for patent infringement in the US. These plaints are declared resting by the court awaiting the results of reexamination cases of the validity of the patents by the US Patent and Trademark Office.

The US Patent and Trademark Office's Patent Trial and Appeal Board has declared all patent demands in US patents 7,138,061, 7,381,327 and 7,410,571 invalid. The decision has been appealed by the other party to the US Court of Appeals for the Federal Circuit.

The reexamination cases concerning US patents 8,066,875 and 7,381,327 are in progress at the US Patent and Trademark Office and there is nothing additional to report in relation to these two cases.

Biotage's analysis indicates that the company has a strong position and that the other party lacks good cause for the alleged patent infringement.

Share buy-back program

After the year end closing, an additional 1,523,369 own shares have been acquired where after Biotage holds a total of 3,306,275 shares.

Establishment of dividend policy

Biotage's aim is to provide the shareholders with a healthy return and value growth. It is important that Biotage can grow the business and have the ability to act on business opportunities that arise. Biotage's policy is to distribute as dividend at least 50 percent of the net profit.

Human resources

At December 31, 2012 the Group had 290 employees, compared to 270 at the start of the year and 282 at September 30, 2012.

Parent company

The Group's parent company Biotage AB has wholly owned subsidiaries in Sweden, the United States, United Kingdom, Germany, France, Italy, Japan and China. The parent company is responsible for group management, strategic business development and administrative functions at Group level and towards subsidiaries.

In the fourth quarter 2012 the parent company's net income amounted to 0.5 MSEK (0.5). In the full year 2012 net income amounted to 2.1 MSEK (2.1). The result after financial items in the fourth quarter was 21.2 MSEK (13.6). In the full year 2012 the result after financial items was 12.8 MSEK (6.9).

The parent company's investments in intangible fixed assets amounted to 0.4 MSEK (0.9) in the fourth quarter and to 1.4 MSEK (1.7) in the full year.

Of the parent company's long-term receivables from group companies at December 31, 2012 receivables to a gross amount of 163 MSEK (183 MSEK at December 31, 2011) are receivables classified as part of the investments in the foreign operations, which means that changes in the value of the items due to changed currency exchange rates are reported as other total result.

The parent company's cash and cash equivalents amounted to 52.3 MSEK at December 31, 2012, compared to 104.7 MSEK at December 31, 2011. The decrease of the parent company's cash and securities is mainly attributable to the payment of dividends to shareholders to the amount of 29.3 MSEK and repurchasing of own shares to the amount of 35.2 MSEK.

Risks and uncertainties

As an international Group, Biotage is exposed to various risks that affect the possibilities to achieve the established targets. There are operational risks, such as the risk that competitive situations affect price levels and sales volumes, and the risk that the economic development in the markets and segments where the Group operates is not stable. There are also financial risks, such as currency risks, interest risks and credit risks.

No major changes in significant risks or uncertainty factors have occurred during the period. A detailed account of Biotage's risks, uncertainty factors and the handling of these can be found in the company's Annual Report for 2011. Readers wishing to study the risks and uncertainties reported in the 2011 Annual Report can download this from Biotage AB's website www.biotage.com or order it from Biotage AB, Box 8, SE-753 18 Uppsala or [email protected].

Reports relating to 2012 and 2013

The Annual Report for 2012 is planned to be made public in week 14 2013. The Annual General Meeting will be held on April 25, 2013.

The interim report for the first quarter 2013 will be issued on April 25, 2013. The interim report for the second quarter 2013 will be issued on August 15, 2013. The interim report for the third quarter 2013 will be issued on October 25, 2013. The year-end report for 2013 will be issued on February 13, 2014.

This report has not been reviewed by the company's auditor.

Uppsala February 12, 2013

Torben Jörgensen President and CEO

For further information, please contact:

Torben Jörgensen, President and CEO, phone:+46 707 49 05 84 Erika Söderberg Johnson, CFO, phone: +46 730 50 80 56

The information in this press release is of the kind that Biotage AB (publ) is required to make public according to the Financial Instruments Trading Act. The information was released for publication at 08.00 on February 12, 2013.

About Biotage

Biotage offers solutions, knowledge and experience in the areas of analytical chemistry, medicinal chemistry, separation and purification. The customers include pharmaceutical and biotech companies, companies within the food industry and leading academic institutes. The company is headquartered in Uppsala and has offices in the US, UK, China and Japan. Biotage has approx. 290 employees and had sales of 463 MSEK in 2012. Biotage is listed on the NASDAQ OMX Nordic Stockholm stock exchange. Website: www.biotage.com

Biotage AB (publ) Interim report 2012-01-01 -- 2012-12-31 CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

2012-10-01 2011-10-01 2012-01-01 2011-01-01
Amounts in SEK thousands 2012-12-31 2011-12-31 2012-12-31 2011-12-31
Net sales 113,941 116,031 462,942 428,408
Cost of sales -45,825 -52,168 -191,508 -182,127
Gross profit 68,117 63,863 271,434 246,281
Distribution costs -34,294 -35,473 -141,865 -140,824
Administrative expenses -12,422 -10,629 -47,416 -46,198
Research and development costs -7,729 -8,056 -36,848 -34,900
Other operating income -154 101 -1,457 718
Total operating expenses -54,599 -54,057 -227,586 -221,205
Operating profit/loss 13,518 9,806 43,847 25,076
Financial net income -3,108 911 -5,531 2,911
Profit/loss before income tax 10,410 10,717 38,316 27,987
Tax expenses 3,207 -854 308 -2,046
Profit/loss after tax for continuing operations 13,618 9,863 38,624 25,941
Profit/loss after tax for discontinued operations - 7,300 -288 6,533
Total profit/loss for the period 13,618 17,163 38,336 32,475
Other comprehensive income
Translation differences related to
non Swedish subsidiaries 460 913 -7,485 4,099
Cash flow hedges -650 1,170 632 -404
Total other comprehensive income -189 2,082 -6,852 3,695
Total comprehensive income for the period 13,428 19,245 31,483 36,169

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (Continuing)

2012-10-01
2012-12-31
2011-10-01
2011-12-31
2012-01-01
2012-12-31
2011-01-01
2011-12-31
Attributable to parent company´s shareholders:
Total profit/loss for the period 13,618 17,163 38,336 32,475
Attributable to parent company´s shareholders:
Total comprehensive income for the period 13,428 19,245 31,483 36,169
Average shares outstanding (*) 72,227,916 76,702,836 73,258,156 78,094,450
Average shares outstanding after
dilution (*) 72,227,916 76,702,836 73,258,156 78,094,450
Shares outstanding at end of reporting period (*) 73,255,705 79,637,688 73,255,705 79,637,688
Total profit/loss for the period per share SEK 0.19 0.22 0.52 0.42
Total profit/loss for the period per share SEK after dilution 0.19 0.22 0.52 0.42
Earnings per share relates to:
Continuing operations 0.19 0.13 0.52 0.33
Discontinued operations 0.00 0.09 0.00 0.09
Total comprehensive income for the period
per share SEK 0.19 0.25 0.43 0.46
Total comprehensive income for the period
per share after dilution SEK 0.19 0.25 0.43 0.46
(*) Of the numbers of shares outstanding are
repurchased as per end of reporting period 1,782,906 3,266,956 1,782,906 3,266,956
Average numbers of shares outstanding are reported
excluding numbers shares repurchased.
Quarterly summary 2012 and 2011 2012 2012 2012 2012 2011 2011 2011 2011
Amounts in KSEK Q 4 Q 3 Q 2 Q 1 Q 4 Q 3 Q 2 Q 1
Net Sales 113,941 107,134 122,287 119,579 116,031 106,551 98,628 107,198
Cost of sales -45,825 -42,532 -51,889 -51,262 -52,168 -44,999 -40,735 -44,226
Gross profit 68,117 64,602 70,398 68,317 63,863 61,552 57,893 62,972
Gross margin 59.8% 60.3% 57.6% 57.1% 55.0% 57.8% 58.7% 58.7%
Operating expenses -54,599 -55,727 -57,532 -59,729 -54,057 -50,638 -56,138 -60,372
Operating profit/loss 13,518 8,875 12,866 8,588 9,806 10,915 1,755 2,600
Finansnetto -3,108 -3,862 625 813 911 813 803 385
Profit/loss before income tax 10,410 5,013 13,491 9,401 10,717 11,727 2,558 2,985
Tax expenses 3,207 -1,345 -304 -1,250 -854 -284 -178 -729
Profit/loss after tax for continuing operations 13,618 3,669 13,187 8,151 9,863 11,443 2,380 2,256
Profit/loss after tax for discontinued operations - - - -288 7,300 - - -767
Total profit/loss for the period 13,618 3,669 13,187 7,863 17,163 11,443 2,380 1,489

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Amounts in SEK thousands 2012-12-31 2011-12-31
ASSETS
Non-Current assets
Property, plant and equipment 40,695 39,468
Goodwill 102,054 106,108
Other intangible assets 116,260 111,100
Financial assets 1,205 2,286
Deferred tax asset 41,733 39,436
Total non-current assets 301,946 298,399
Current assets
Inventories 84,119 89,694
Trade and other receivables 97,092 106,251
Cash and cash equivalents 170,916 204,711
Total current assets 352,128 400,656
TOTAL ASSETS 654,074 699,054
EQUITY AND LIABILITIES
Capital and reserves attributable to equity holders of the
parent company
Share capital 89,372 89,194
Other paied-in capital 4,993 4,993
Reserves -107,801 -100,949
Retained earnings 544,266 570,659
Total equity 530,829 563,897
Non-current liabilities
Liabilities to credit institutions 5,124 5,850
Deferred tax liability 1,752 1,949
Non-current provisions 24,179 25,184
Total non-current liabilities 31,054 32,983
Current liabilities
Trade and others liabilities 88,268 96,037
Tax liabilities 1,354 774
Liabilities to credit institutions 434 442
Current provisions 2,134 4,921
Total current liabilities 92,190 102,173
TOTAL EQUITY AND LIABILITIES 654,074 699,054

Note

Reported deferred tax liability of 1,949 KSEK for 2011 has in previous financial reports been included in the item Current provisions

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Amounts in SEK thousands Share
capital
Other
payed-in
capital
Accumulated
translation
reserve
Hedging
reserve
Retained
earnings
Total
equity
Opening balance January 1, 2011 88,486 4,993 -104,643 0 579,112 567,948
Changes in equity in the
period of January 1 - September 30, 2011
Total comprehensive income - - 3,186 -1,574 15,311 16,924
Total non-owners changes - - 3,186 -1,574 15,311 16,924
Transacitions with equity holders of the company
Cancellation of treasury shares (*) -8,849 - - - 8,849 0
Increase of share capital without the issue
of new shares, bonus issue (*) 9,557 - - - -9,557 0
Dividend to shareholders of the parent company - - - - -19,909 -19,909
Share buy-back by parent company (*) - - - - -16,926 -16,926
Closing balance September 30, 2011 89,194 4,993 -101,457 -1,574 556,881 548,037
Changes in equity in the
period of October 1, - December 31, 2011
Total comprehensive income - - 913 1,170 17,164 19,246
Total non-owners changes - - 913 1,170 17,164 19,246
Transacitions with equity holders of the company
Share buy-back by parent company (*)
Closing balance December 31, 2011
-
89,194
-
4,993
-
-100,544
-
-404
-3,386
570,659
-3,386
563,897
Changes in equity in the
period of January 1 - September 30, 2012
Total comprehensive income - - -7,945 1,282 24,718 18,055
Total non-owners changes 0 0 -7,945 1,282 24,718 18,055
Transacitions with equity holders of the company
Cancellation of treasury shares (*) -7,148 - - - 7,148 0
Increase of share capital without the issue
of new shares, bonus issue (*) 7,326 - - - -7,326 0
Dividend to shareholders of the parent company - - - -29,302 -29,302
Share buy-back by parent company (*) - - - - -23,946 -23,946
Closing balance September 30, 2012 89,372 4,993 -108,490 878 541,952 528,705
Changes in equity in the
period of October 1, - December 31, 2012
Total comprehensive income - - 460 -650 13,618 13,428
Total non-owners changes - - 460 -650 13,618 13,428
Transacitions with equity holders of the company
Share buy-back by parent company (*) - - - - -11,303 -11,303
Closing balance December 31, 2012 89,372 4,993 -108,029 228 544,266 530,829

(*) Repurchased shares, cancellation of repurchased shares and bonus issue

Repurchased shares, cancellasion of repurchased shares and bonus issue.

At the Annual General Meeting 2009 and 2010 respectively, the Board was authorized to repurchase the company's shares to the extent that the holding of own shares amounted to a maximum of 10 percent of the total number of shares issued. From September 2009 to December 2010 the company repurchased a total of 8,848,632 shares, corresponding to 10.0 percent of the company's total issued shares. At the Annual General Meeting 2011 it was decided that the repurchased shares should be cancelled. As a result of the cancellation, the company's share capital decreased by 8,849 KSEK to 79,638 KSEK. The number of shares was reduced from 88,486,320 to 79,673,688. At the Annual General Meeting 2011 it was also decided that the company should carry out a bonus issue and thereby increase the company's share capital by 9,557 KSEK to 89,194 without issuing any new shares.

After the cancellation of repurchased shares and the bonus issue the number of shares was 79,637,688 with a quota value of 1.12 SEK. The Annual General Meeting 2011 further resolved to authorize the Board to carry out a new repurchasing program comprising a maximum of 10 percent of the company's outstanding shares, i.e. a total of 7,963,769 shares. At the time of the Annual General Meeting of April 26, 2012 the company had in accordance with the authorization repurchased 6,381,983 shares at an average share price of 6.40 SEK.

In accordance with the proposal of the Board, the Annual General Meeting 2012 resolved that the 6,381,983 repurchase shares should be cancelled. The company's share capital therefore decreased by7,148 KSEK. At the same time it was decided that the company's share capital should be increased by 7,326 KSEK through a bonus issue where the issue sum was transferred from the parent company's non-restricted reserves. After realization of the AGM's decisions the registered share capital is 89,371,960 SEK and the number of outstanding shares 73,255,705 with a quota value of 1.22 SEK.

The Annual General Meeting also resolved to authorize the Board to continue to repurchase shares up until the Annual General Meeting 2013, so that the company's holding of own shares amounts to a maximum of 10 percent of the number of registered shares. At the balance sheet date December 31, 2012 the company has, in accordance with this authorization, repurchased 1,782,906 shares at an average price of 8:27 SEK.

Biotage AB (publ) Interim report 2012-01-01 -- 2012-12-31 CONSOLIDATED STATEMENT OF CASH FLOWS

Amounts in SEK thousands
2012-12-31
2011-12-31
2012-12-31
2011-12-31
Operating activities
Profit/loss before income tax
10,410
10,717
38,316
27,987
Adjustments for non-cash items
6,589
9,487
36,546
35,560
16,999
20,204
74,862
63,547
Income tax paid
2,940
-1,052
978
-3,979
Cash flow from operating activities
before changes in working capital
19,940
19,152
75,840
59,568
Cash flow from changes in working capital:
Increase (-)/ decrease (+) in inventories
1,546
-1,164
982
9,992
Increase (-)/ decrease (+) in trade receivables
6,182
6,526
4,806
8,191
Increase (-)/ decrease (+) in other current receivables
1,269
-1,590
-5,659
3,951
Increase (+)/ decrease (-) in other liabilities
997
10,298
-8,508
13,104
Cash flow from operating activities - continuing operations
29,934
33,222
67,461
94,806
Cash flow from operating activities - discontinued operations
-
-
7,012
14,243
Cash flow from operating activities
29,934
33,222
74,472
109,050
Investing activities
Acquisition of intangible assets
-8,519
-9,665
-29,586
-30,347
Acquisition of property, plant and equipment
-1,897
-2,791
-10,373
-11,910
Acquisition of financial assets
-39
-252
-300
-269
Acquisitions of companies and product lines
-
-
-
-2,027
Sale of property, plant and equipment
-
-
-
-
Sale of financial assets
66
330
261
753
Cash flow from investing activities - continuing operations
-10,389
-12,379
-39,998
-43,801
Cash flow from financing activities - discontinued operations
-
-
-
-
Cash flow from investing activities
-10,389
-12,379
-39,998
-43,801
Financing activities
Dividend to shareholders
-
-
-29,302
-19,909
Buy-back of shares
-11,303
-3,385
-35,249
-20,311
Repayment of loans
-152
-158
-625
-629
Cash flow from financing activities - continuing operations
-11,456
-3,543
-65,176
-40,849
Cash flow from financing activities - discontinued operations
-
-
-
-
Cash flow from financial activities
-11,456
-3,543
-65,176
-40,849
Cash flow for the period
8,089
17,300
-30,702
24,399
Cash and cash equivalents opening balance
162,817
188,074
204,711
179,573
Exchange differences in liquid assets
10
-664
-3,093
739
Cash and equivalents closing balance
170,916
204,711
170,916
204,711
Additional information:
Adjustments for non-cash items
Depreciations and impairments
6,757
8,836
28,612
35,983
Other items
-168
650
7,934
-423
2012-10-01 2011-10-01 2012-01-01 2011-01-01
Total 6,589 9,487 36,546 35,560
Interest received
392
963
2,447
3,111
Interest paid
-41
-52
-206
-200

INCOME STATEMENT, PARENT

2012-10-01 2011-10-01 2012-01-01 2011-01-01
Amounts in SEK thousands 2012-12-31 2011-12-31 2012-12-31 2011-12-31
Net sales 524 532 2,117 2,098
Administrative expenses -5,331 -5,153 -22,295 -23,384
Research and development costs -305 -326 -1,383 -1,283
Other operating items -1,425 7,811 -1,883 6,319
Operating expenses -7,061 2,332 -25,561 -18,348
Operating profit/loss -6,537 2,864 -23,444 -16,251
Profit/loss from financial investments:
Interest income from receivables from group companies 2,825 2,774 9,958 12,276
Interest expense from liabilities to group companies -732 -493 -2,200 -1,882
Result from participations in group companies -13,290 -11,620 -10,568 -9,284
Other interest and similar income 4,429 801 6,067 2,768
Other interest and similar income -1,173 - -2,700 -
Group contribution received 35,649 19,245 35,649 19,245
Financial net income 27,706 10,707 36,205 23,122
Profit/loss before income tax 21,170 13,571 12,761 6,872
Tax expenses 2,297 - 2,372 -
Total profit/loss for the period 23,466 13,571 15,133 6,872
STATEMENT OF COMPREHENSIVE INCOME. PARENT
Total profit/loss for the period 23,466 13,571 15,133 6,872
Other comprehensive income:
Translation differences related to
non Swedish subsidiaries -2,838 516 -13,509 -6,305
Total comprehensive income, parent 20,629 14,087 1,625 567

Biotage AB (publ) Interim report

2012-01-01 -- 2012-12-31 BALANCE SHEET, PARENT Amounts in SEK thousands 2012-12-31 2011-12-31 ASSETS Non-current assets Intangible assets Patents and licenses 7,718 6,909 Financial assets Investments in group companies 481,728 494,181 Receivables from group companies 7,789 60,992 Deferred tax asset 41,733 39,436 531,250 594,609 Total non-current assets 538,968 601,519 Current assets Current receivables Receivables from group companies 11,762 10,441 Other receivables 4,891 1,035 Prepaid expenses and accrued income 1,399 8,089 18,051 19,565 Cash and cash equivalents 52,286 104,684 Total current assets 70,337 124,249 TOTAL ASSETS 609,305 725,767 EQUITY, PROVISIONS AND LIABILITIES Equity Restricted equity Share capital 89,372 89,194 89,372 89,194 Unrestricted equity Fair value reserve -66,742 -53,233 Retained earnings 433,996 491,854 Profit/loss for the year 15,133 6,871 382,388 445,492 Total equity 471,759 534,686 Provisions 24,024 26,391 Current liabilities Trade payables 2,157 1,073 Liabilities to group companies 106,026 158,671 Other current liabilities 1,273 286

Accrued expenses and prepaid income 4,065 4,661
113,522 164,690
TOTAL EQUITY, PROVISIONS AND LIABILITIES 609,305 725,767
Pledged assets 22,500 22,500
Contingent liabilities - -

Accounting principles

Biotage's Group reporting is based on International Financial Reporting Standards as adopted by the EU. The Group's interim report is prepared in accordance with IAS 34 Interim Reporting and the Swedish Accounting Act. The parent company's interim report is prepared in accordance with the Swedish Accounting Act and The Swedish Financial Reporting Board's recommendation RFR 2 Reporting for legal entities.

Revised or new standards, interpretations or statements from standard-setting bodies for IFRS within the EU that have come into effect on January 1, 2012 have not had any effect on the Group's financial reporting, as these have not been relevant to Biotage AB in the current situation.

From April 1, 2012, Biotage has changed the assessment of periods of utilization at the amortization of capitalized development costs. The period of utilization has been assessed to be 7 years for the development of instruments and consumables, which have previously been amortized over periods of 3 and 5 years, respectively. These adaptations of the periods of utilization in the reporting are made in order to better reflect the management's assessment of the economic life of the company's products, based on information gained through analyses and increased experience. The revision of the periods of utilization constitutes a change assessment that is reported future-oriented and does thus not concern previous periods.

Net financial income 2012 includes currency effects on certain inter-company items and other financial items that were previously considered to be related to the operations.

In the preparation of the Group's and the parent company's interim reports, the same accounting principles and calculation methods were in all other respects applied as in the preparation of Biotage's Annual Report for 2011. These are described on pp. 32-41 in the Annual Report.

Readers wishing to study the accounting principles presented in the 2011 Annual Report can download this report from Biotage AB's website www.biotage.com or order it from Biotage AB, Box 8, SE-753 18 Uppsala, Sweden, or [email protected].

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