Annual Report • Mar 24, 2016
Annual Report
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| Biohit in brief | 1 |
|---|---|
| Year 2015 | 2 |
| CEO's review | 4 |
| Strategy | 6 |
| Quality | 8 |
| Board of Directors and | |
| Management team 10 | |
| Information for shareholders | 12 |
| Summary of stock | |
| exchange releases | 13 |
| History | 14 |
| Corporate Governance 2015 | 17 |
| Financial Statements 2015 . | 23 |
Biohit Oyj is a Finnish biotechnology company operating on global markets. Our mission, "Innovating for Health", describes our innovative products and services, which aim to promote medical research and early diagnostics. Biohit was established in 1988.
Our goal is to improve people's quality of life by preventing diseases, human suffering and financial loss. As a responsible company, we aim to increase people's awareness of their exposure to group I carcinogen, acetaldehyde, and to reduce the harmful effects of such exposure. Biohit is headquartered in Helsinki and it has subsidiaries located in Italy and the United Kingdom. Biohit's Series B shares (BIOBV) are listed in NASDAQ OMX Helsinki Oy's Small Cap group and in the healthcare sub-sector.
Gastrointestinal diseases are a growing worldwide phenomenon, with related medical, ethical and financial problems. Worldwide, gastrointestinal diseases are the most common cause of gastric symptoms. As the population ages, the need for healthcare will increase further, leading to an urgent requirement for new, costeffective solutions.
Biohit continuously develops its products and services to address growing needs. Our products and services are safe, ethical and cost-effective innovations for diagnosing and preventing gastrointestinal diseases and associated risks.
We began using new operating models that will make our work more efficient and grow our business. We updated our product range to address customers' needs.
We expanded our distributor network all over the world by signing several new distributor- and partnership agreements. We increased our sales and improved our result. We also expanded our service sales across Finland and we began using an electronic appointmentbooking service. In accordance with our strategy, we took customer feedback into consideration and developed our products and operations on this basis. We expanded our product range by adding a vitamin D test and a quick test reader, we unified the GastroPanel test and developed new forms of collaboration with our customer groups. A good example of this is our pharmacy campaigns, which regularly operate all over Finland offering testing of the gastrointestinal tract.
In addition to developing new products, we improved the usability and customer-friendliness of our products. In production, we automated processes and increased capacity. We are continuously improving our operations to guarantee high-quality products for our customers.
During the reporting period, the average number of personnel employed by the Group was 52 (50 in 2014), of whom 44 (41) were employed by the parent company and 8 (9) by subsidiaries. At the end of 2015, the Group employed 49 (51) personnel, of whom 40 (42) were employed by the parent company and 9 (9) by subsidiaries.
Our financial position remained good. We are able to make investments in building an international network of distributors, as well as in developing and commercialising new products. At the end of the financial year, the company's financial assets amounted to EUR 7.2 million.
Profit/loss in continuing operations 2011–2015, 1,000 EUR
Average number of personnel in continuing operations 2011–2015
Equity ratio
to enable early diagnosis and prevention of diseases of the gastrointestinal tract
commercialisation of new products and support to international distribution channels
enabling of appropriate and adequate treatment, early prevention of serious diseases, impact on public health
6.1MEUR Net sales
Year-on-year net sales growth
38.7%
| BIOHIT GROUP KEY FIGURES | 2015 | 2014 |
|---|---|---|
| Net sales, MEUR | 6,1 | 4.4 |
| Operating profit/loss, MEUR | –2.9 | –4.5 |
| Profit/loss before taxes, MEUR | –2.9 | –4.3 |
| Profit/loss for the period, continuing operations, MEUR | –2.9 | –4.4 |
| Profit/loss for the period, discontinued operations, MEUR | 3.3 | |
| Profit/loss for the period, MEUR | –2.9 | –1.2 |
| Average number of personnel | 52 | 50 |
| Number of personnel at the end of the period | 49 | 51 |
| Equity ratio % | 87.9 | 87.5 |
| Earnings per share, continuing operations EUR | –0.20 | –0.32 |
| Earnings per share, discontinued operations, undiluted EUR | 0.23 | |
| Shareholders' equity per share, EUR | 0.72 | 0.9 |
| Average number of shares during the period | 14,276,519 | 13,941,286 |
| Number of shares at the period end | 14,348,533 | 14,135,593 |
Our products are based on highquality scientific research.
2015 was a year of progress. We signed new distributor and partnership agreements, improved our service sales and expanded our product range. We increased sales and improved our result. We also made progress in terms of product development and clinical studies.
We made new agreements to expand the distribution of Acetium® to Spain (Biomed S.A.), Portugal (Queenslabs Lda), and Vietnam, Laos, Cambodia and Myanmar (Daiichi-Sankyo Thailand Ltd) and Baltia (Oriola Oy). We also improved the availability of products in Italy (LS Pharma) and Sudan (El-Alawia Medical Agencies). We made an agreement with Oriola Oy to enable it to become the exclusive distributor of Acetium products in Finland. Additionally, we made an agreement concerning the distribution of Acetium lozenges in the United Arab Emirates (Birtely Pharma). We expanded the distribution of Acetium lozenge to dental care in Finland by beginning a cooperation with Hammasväline Oy.
We improved the availability of our diagnostic tests in Kazakhstan (Melon OOO), Portugal (ARIUM Sistemas de Diagnòstico Lda), Finland (Mekalasi), Kuwait (Health Life) and Serbia, Bosnia and Hertzegovina, Montenegro (Biohemed doo). In the United Arab Emirates, Gulf Drug LLC received exclusive rights to distribute diagnostic tests. Additionally, we made an agreement concerning diagnostic distribution in Indonesia (PT InoDia) and Korea (Humasis). We also made an agreement concerning distribution of the ColonView test in China with Zhejiang Co. Ltd.
One of our achievements was registering the Acetium capsule in China, where our partner, GrandPharma, will begin selling the capsule under the Shubang brand name.
We continued our work to promote care procedures by commencing the first tangible activities in screening for gastric and colorectal cancer. Usage of the GastroPanel kit began in screening projects in China, where one project will involve screening 500,000 asymptomatic people, while another will involve screening 20,000 asymptomatic people. These are the first population-based screening projects to identify the risks of gastric and colorectal cancer, and the projects represent a significant step forward for the use of GastroPanel tests in the screening of asymptomatic people. In Russia, ColonView test is included in a pilot project for screening of colorectal cancer.
The first, nearly two-year smoking intervention study was completed at the end of 2015. According to preliminary observations, the Acetium lozenge containing slowly releasing L-cysteine is a promising novel method to assist in smoking cessation. This is a new significant indication of the possible benefit of the product in addition to that it has no side effects such as with medication and nicotine products, and it binds carcinogenic acetaldehyde dissolved into saliva from cigarette smoke into a harmless compound promoting oral health.
The effectiveness of Acetium lozenges was evaluated by a study presented during a convention held by the European Society for Biomedical Research on Alcoholism. The studies confirmed previous scientific evidence that Acetium efficiently binds carcinogenic acetaldehyde to form a harmless compound.
An international study showed that ColonView is superior to the conventional tests in colorectal cancer screening due to its sensitivity and specificity. During 2015 some twenty clinical trials were ongoing in
Finland and abroad with Biohit's diagnostic tests and Acetium products. Our products are based on scientific research, and the scientific advisory board, which convenes regularly, constitutes a valuable part of our operations.
We concluded the GastroPanel unification project, in which the reaction conditions and solutions of four biomarkers (pepsinogen I and II, gastrin-17, Helicobacter pylori antibodies) were unified. Unification substantially increases the speed of the test as part of basic health care and screening.
We added a vitamin D test to our product range and service laboratory to complement diagnostics intended to prevent osteoporosis and bone fractures. The reliable Biohit 25-0H vitamin D Total ELISA test can be used to identify a need for vitamin D supplements. We also expanded our range with the addition of a quick test reader for the ColonView and celiac tests.
On the basis of a consumer study, we expanded the Acetium product family with the addition of a new salty liquorice flavoured lozenge.
We continued to increase awareness of acetaldehyde by means of studies and communicating with decision makers. The European Parliament's Environment, Public Health and Food Safety Committee has proposed that the Commission immediately request the European Food Safety Authority (EFSA) to evaluate the use of acetaldehyde as a flavouring ingredient in alcoholic and non-alcoholic drinks. The approval of the proposal in May 2015 was a tangible step in increasing awareness. We will continue to advance this matter actively.
I would like to thank the personnel and partners of Biohit, as well as our active investors. We are extremely excited to continue realising Biohit's unique opportunities.
Semi Korpela
We will make our operations simpler and more efficient. We take customer benefits into consideration in all of our decisions.
Our mission is "Innovating for Health". Our vision is to be the world's leading biotechnology company in selected markets promoting gastrointestinal well-being:
a) Advanced and innovative in vitro diagnostic tests of the gastrointestinal tract and use of tests for screening b) Products that bind carcinogenic acetaldehyde into a harmless compound in the gastrointestinal tract
We aim to increase net sales primarily in the following areas:
Our competitive advantage is a quick, flexible and cost-efficient distribution chain where customers play a key role. We are creating increasingly efficient processes. In addition, we are continuously digitising and automating our operations and services.
Whenever we make a decision, we consider how the decision will benefit customers and how it will enable innovation for customers.
Our target is to constantly improve quality. We monitor our operations and make all required improvements at a rapid pace. We take more preventive measures than corrective measures.
The joint venture, Biohit Biotech (Hefei) Co., Ltd, continued its efficient work to enable sales of locally-produced GastroPanel tests to begin in China. The production plants were completed at the end of 2015 and China's food and drug administration has approved them.
The joint venture is advancing the local registration of the three GastroPanel tests (Pepsinogen I, Pepsinogen II and Gastrin-17) manufactured in China with the food and drug administration. The tests are subject to clinical trials before they can be registered.
The CEO of the joint venture, Liu Feng, describes the progress of the registration process:
"Ethical approval has been granted for clinical trials of the product. We expect to obtain registration, ISO 13485 certification, product licensing and marketing authorisation for test kits by the end of 2016."
In 2015, price approval decision was issued in four provinces for GastroPanel test kits that are manufactured in Finland and sold in China. Price approval decision has already been received in 11 provinces. Price approval is a pre-requisite for reimbursability of GastroPanel and start of sales.
High-quality products and services are created through interaction with customers. Customer feedback provides a direction for continuous improvement.
Biohit's products and services are innovative, ethical and cost-effective. The development, production and marketing of our products is subject to strict quality requirements. We are committed to continuous improvement based around increasing the benefit to customers. We are developing our processes in accordance with Lean thinking models and we are continuously monitoring our performance using qualityrelated and environmental indicators.
Our products bear the CE mark and our diagnostic products are designed and researched in accordance with European IVD Directive 98/79/EC. Our Acetium products fulfil the requirements applying to medical devices in Directive 93/42/EC and they bear the key flag symbol. High-level documentation is a requirement for international product registration.
Biohit's products have been designed to minimise environmental load throughout their entire life cycles. During the product development phase, we reduce the amounts of hazardous substances used and we choose recycled materials for our packaging. The company is a member of the waste recycling systems Finnish Packaging Recycling RINKI Ltd and Der Grüne Punkt.
In 2015, Biohit's quality and environmental systems were recertified in accordance with the ISO 9001, ISO 13485 and ISO 14001 standards. Foreign air freight deliveries of our products run smoothly thanks to our status as an "Identified sender", which was granted by the Finnish Transport Safety Agency (Trafi).
The project to unify the GastroPanel test kit was completed in 2015. This project is a good example of users' needs leading to product improvements. In addition to our annual customer satisfaction survey, everyday contact with customers is important to us. We are able to rapidly implement product improvements requested by customers.
One indicator of the development of our operations is the annual customer satisfaction survey, which is sent to our partners. We received particular praise for our professionalism. Our marketing materials also corresponded well to customers' requirements. Our partners provided us with development ideas on matters such as package sizes and our product range.
We always strive to deliver our products quickly and precisely. The survey showed that Biohit operates very well in this regard. The achievements that received particular recognition from our partners were our unique products and ability to provide professional information about matters such as registration.
Biohit's Quality Director, Annika Astola, summarises the advantages of the customer survey: "The customer satisfaction survey helps us to improve our operations. We take into account all feedback that we receive – this enables us to develop our product selection so that it serves the diverse requirements of our customers even better."
10
JANINA ANDERSSON, b. 1971
SEMI KORPELA, b. 1970
MSc (Econ.)
LEA PALOHEIMO, b. 1951
KARI SYRJÄNEN, b. 1948
Biohit Oyj's Annual General Meeting is planned to be held at 3 pm on Monday 25 April 2016 in Helsinki, Finland. The Board of Directors will call the General Meeting at a later date.
The parent company's distributable funds (unrestricted equity) on 31 December 2015 are 6,079,716.06, of which the period net loss is 3,526,862.99. The Board of Directors proposes to the Annual General Meeting that no dividend be paid for the financial year.
Total number of shares: 14,348,533 Series A shares (20 votes per share): 2,975,500 Series B shares (1 vote per share):11,373,033 Biohit Oyj: The Series B shares are listed in the NASDAQ OMX Helsinki Oy Small Cap group. The shares are traded under the symbol BIOBV. More detailed information about Biohit Oyj's shares is provided in the notes to the consolidated financial statements and on the company's website at www.biohithealthcare.com/ investors.
The financial reviews and other stock exchange releases published by Biohit are available on the company's website at www.biohithealthcare.com/investors. You can also subscribe to receive financial communications by email using the subscription form on the website.
Thursday 18 August 2016 Half-yearly report, January–June 2016 (Q2)
Biohit observes a silent period of three weeks before results are published. During this period, Biohit's management and other personnel will not provide information about the company's financial position or market-related comments, nor will they meet with representatives from equity markets or the financial media.
However, if an event that requires immediate publication takes place during the silent period, Biohit will publish information without delay in accordance with disclosure regulations. In such cases, the company is able to comment on the event.
| 26th Feb 2015 | Biohit group Financial Statement Release 2014 |
7th Aug 2015 | Biohit Oyj B-shares Subscribed with Stock Options I 2013 B |
|---|---|---|---|
| 10th Mar 2015 | Biohit and Oriola to distribution agreement |
20th Aug 2015 | Biohit Group Interim Report Q2/2015 |
| 17th Mar 2015 | Notice of Biohit Oyj's Annual General Meeting |
22nd Oct 2015 | Biohit Group Interim Report Q3/2015 |
| 30th Mar 2015 | Publication of Biohit Oyj Annual Report 2014 |
4th Nov 2015 | Acetium lozenge – a promising novel method to assist smoking cessation |
| 31st Mar 2015 | Biohit Oyj B-shares Subscribed with Stock Options II 2013 |
4th Dec 2015 | Biohit's Financial Reporting and Annual General Meeting in 2016 |
| 20th Apr 2015 | Decisions of the Annual General Meeting of Biohit Oyj |
16th Dec 2015 | Biohit Oyj's Management Team Option Arrangement |
| 21st Apr 2015 | Constitutive meeting of Biohit Oyj's Board of Directors |
17th Dec 2015 | Biohit Oyj will change its financial reporting – in the future, the |
| 7th May 2015 | Biohit Group Interim Report Q1/2015 |
company will publish financial reviews twice a year |
|
| 18th Jun 2015 | Biohit Oyj B-shares Subscribed with Stock Options II 2013 |
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| 28th Jul 2015 | Population-based screening study of asymptomatic persons to start in China using GastroPanel biomarkers disclosing gastric cancer risk |
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The success of Biohit is mostly based on an aggressive innovation and patenting strategy developed by Professor Osmo Suovaniemi, MD, PhD. He can be considered a pioneer of this strategy, showing successful model for small and large companies in Finland. This strategy dates back to the early 1970s when Suovaniemi established the predecessors to Biohit Oyj, Labsystems Oyj (1972) and the joint venture, Eflab Oy (1978). The rational for the "Aggressive Innovation and Patenting strategy" resides in its major beneficial effects both for small and large companies. In contrast, giving up on this strategy frequently precedes the development of an economic depression in Finland and abroad. Read more:
Analysis and liquid handling devices based on innovations created by Labsystems, Eflab and Biohit have been adopted into global use, enabling the massive development of immunoassays using non-radioactive markers based on Suovaniemi's vertical measurement innovation. These immunoassays have been used for research and diagnosis of infections and cancer. Immunoassays and vertical measurements have become global industrial standards, revolutionising laboratory routines worldwide since the 1970's and 1980's. They have also made possible the development of the GastroPanel test and Biohit's other immunoassays.
In 2011 Biohit Oyj sold its liquid handling business to Sartorius Lab Holding GmbH for EUR 68 million.
Over 20 years of research and development culminated in the unified GastroPanel innovation.
• Biohit launches the Acetium capsule, which binds acetaldehyde into a harmless compound. Acetaldehyde is a carcinogen that occurs in anacidic stomachs due to atrophic gastritis (to be detected by GastroPanel) or as a result of proton-pump inhibitors (PPIs).
www.biohithealthcare.com/laboratory-services: Determination of Acetaldehyde
• Biohit Oyj sells its liquid handling business to Sartorius Lab Holding GmbH for EUR 68 million.
• The company re-organises and decides to focus on and invest in rapidly growing and larger markets of diagnostic tests as well as its products that bind carcinogenic acetaldehyde into a harmless compound, thereby promoting the prevention of diseases, improving people's quality of life and contributing to savings in health care costs.
Biohit Oyj has prepared this Corporate Governance Statement on the basis of Section 54 of the Finnish Corporate Governance Code for listed companies issued by the Securities Market Association.
The Corporate Governance Statement has been issued separately from the Report of Biohit Oyj's Board of Directors. The Board of Directors reviewed the Statement in its meeting on 25 February 2016.
The Report of the Board of Directors, the Auditor's Report and the full Corporate Governance Statement are available at www.biohithealthcare.com/investors.
Biohit Oyj is a Finnish public limited company whose series B shares are listed on Nasdaq OMX Helsinki in the Small cap/Healthcare group. Biohit Group (hereinafter referred to as "Biohit") comprises the parent company, Biohit Oyj, and its foreign subsidiaries, which primarily focus on sales and marketing for Biohit Oyj's products. Biohit is headquartered in Helsinki.
Biohit's governance complies with applicable legislation, standards and recommendations concerning public listed companies, the regulations of Nasdaq OMX Helsinki Ltd, and Biohit Oyj's Articles of Association. Biohit Oyj complies with the Finnish Corporate Governance Code ("corporate governance code") for listed companies, which was approved by the Securities Market Association in June 2010 and entered into force on 1 October 2010. Since the beginning of 2016, the company has complied with the new governance code, which was approved by the Securities Market Association in October 2015 and entered into force on 1 January 2016. The Corporate Governance Code is available at www.cgfinland.fi.
On the date of its Annual General Meeting, 20 April 2015, the company complied with recommendation 8 of the corporate governance code, which states that a diverse Board of Directors should include male and female members. Out of the six member Board of Directors half of the members were independent of the company. Therefore the company does not fulfil recommendation 10 on this part whereby a majority of the Board of Directors should be independent of the company. The company strives to comply with high international standards of corporate governance and the key principles of corporate governance among Finnish listed companies.
The highest decision-making power at Biohit is exercised by the company's shareholders at the Annual General Meeting. The company's Board of Directors supervises the administration and organisation of the company and the Group's earnings trends. The President & CEO is responsible for operative management and he is assisted by the Management Team.
In 2015, Biohit Oyj held its Annual General Meeting in Helsinki on 20 April 2015. 2,793,510 series A shares and 4,625,605 series B shares were represented at the meeting, corresponding to 52.17163% of all of the shares in the company and 85.50028% of the votes. The meeting was attended by two of the five members of the Board of Directors, the President & CEO and the principal auditor.
The Board of Directors, which comprises 5–7 members elected by the Annual General Meeting, is responsible for the administration and appropriate organisation of Biohit's business operations. Proposals concerning membership of the Board of Directors are prepared by the Board of Directors. The Board of Directors elects a chairman from amongst its members.
Board members' terms of office run from the date of their election by the AGM until the end of the next AGM.
The Board's areas of responsibility are stated in the written rules of procedure approved by the Board. They are as follows:
The Board's decision-making is based on reports prepared by the company's operative management on the operational development of the Group and its business units.
The Chairman is responsible for convening Board meetings and arranging the work of the Board. The Board convenes 10–12 times per year, usually meeting once per month, and the meeting schedule for the entire term is confirmed in advance. When necessary, Board meetings are held more frequently or by teleconference. Biohit Oyj's Board of Directors convened 10 times in 2015 (11 times in 2014). The average attendance was 100% (92%).
The following persons belonged to Biohit Oyj's Board of Directors in 2015:
Specialist physician in internal medicine, gastroenterologist and Professor of Alcohol Diseases at the University of Helsinki
Attended 10 Board meetings in 2015
Osmo Suovaniemi was Chairman of Biohit Oyj's Board of Directors during the review period.
The scope of Biohit's business operations does not require the appointment of an Audit Committee, and no other committees have been appointed to assist the Board.
The President & CEO is responsible for the day-to-day management of the company in accordance with the instructions and regulations issued by the Board of Directors. The President & CEO of the parent company is elected by the Board and also acts as Group President. He also ensures the appropriate organisation and legality of the company's accounting and asset management.
The terms of employment of the President & CEO are based on a written contract that is approved by the Board of Directors. The President & CEO cannot be elected Chairman of the Board. Semi Korpela, MSc (Econ.) was the President & CEO of Biohit during the financial year.
The composition and areas of responsibility of the Group's Management Team were as follows: Semi Korpela (President & CEO), Niklas Nordström (CFO), Lea Paloheimo (Business Development Director), Anu Mickels (Sales and Marketing Director), Panu Hendolin (R&D Director), Kari Syrjänen (Chief Medical Director) and Annika Astola (Quality Director). The Management Team convened 40 times in 2015.
The Managing Directors of the subsidiaries are responsible for the management of subsidiary operations and report to the President & CEO of the parent company. The subsidiaries are responsible for the sales and marketing of Biohit's products in their market areas. The managers of subsidiaries operate under the management and supervision of Biohit's President & CEO. In 2015, the Managing Directors of Biohit's subsidiaries were: Graham Johnson (United Kingdom) and Franco Aiolfi (Italy).
The personal details and shareholdings of Biohit's Board of Directors and operative management are available at www.biohithealthcare.com/investors.
The Annual General Meeting approves the fees of Biohit Oyj's Board of Directors. A decision was made by the AGM on 20 April 2015 to pay a monthly fee of EUR 1,600 to the Chairman Of the Board and a monthly fee of EUR 1,500 to the other members of the Board of Directors.
An employment contract was signed on 10 June 2010 with Professor Osmo Suovaniemi, a member of the Board, under which Suovaniemi is paid a monthly salary approved by the Board of Directors for his services as scientific advisor to the Board. In 2015, this salary was EUR 14,065.34 per month plus car and phone benefits.
The Board approves the President & CEO's salary and terms of employment. The salary paid to the company's President & CEO, Semi Korpela, in 2015 was EUR 15,091 per month plus phone and car benefit.
The President approves the salaries and terms of employment of members of the Management Team. Biohit's Board of Directors approves the principles of the incentive schemes for Management Team members and the President & CEO. Bonuses are determined on the basis of the net sales and earnings trends in each person's area of responsibility. The maximum bonus that can be received depends on each person's monthly salary and can total no more than two months' salary. No bonus was paid to the President & CEO and Management Team members in 2015.
The President & CEO approves the salaries and profit-based incentives of subsidiaries' Managing Directors in accordance with the instructions provided by Biohit's Board of Directors Profit-based incentives are dependent on sales and profitability trends for each unit's product segments.
In 2013, Biohit introduced an incentive system offering stock options to company directors and employees. In 2015, the President & CEO subscribed for 32,940 of these stock options. The rest of the management or employees did not subscribe for options.
No other pension arrangements, beyond those mandated by law, have been made with the Managing Directors of Group companies.
During the financial year that ended on 31 December 2015, the remuneration paid to members of the parent company's Board totalled EUR 88,000 (EUR 91,000 in 2014). The remuneration paid to the President & CEO, Semi Korpela, amounted to EUR 191,000 (EUR 176,000 in 2014). Osmo Suovaniemi was paid EUR 221,000 (EUR 220,000 in 2014) for his services as a member of the scientific advisory board. The salaries and fees paid to the managing directors of the Group's subsidiaries totalled EUR 126,000 (EUR 101,000 in 2014). Salaries paid to other Management Team members totalled EUR 492,000 (EUR 533,000 in 2014).
Biohit's internal control is responsible for ensuring that the Group carries out its business operations within the framework of current regulations and legislation and in accordance with the instructions of the Board of Directors. Internal control seeks to ensure that the Group operates with maximum efficiency and that efforts are made at various levels of the organisation to achieve the objectives set in the strategy approved by the Board of Directors. Risk management is geared towards supporting the achievement of these objectives by anticipating and managing business-related risks.
Biohit's business operations and administration aim to realise the company's values, of which the most important is to promote health and wellbeing through innovation. Biohit will continue to focus on its diagnostics business, in which the company conducts global operations in manufacturing, sales and marketing.
Biohit's control environment is defined by the Board of Directors, which, as the highest administrative body, is responsible for organising internal control. The President & CEO is responsible for maintaining the efficiency of the control environment and the functionality of internal control. Biohit's financial department is responsible for the functionality of financial reporting as well as the interpretation and application of financial statement standards in line with the separately approved instructions.
In the assessment of risks related to financial reporting, Biohit's objective is to identify the major risks associated with the Group's business operations and environment. The cost-effective management and monitoring of these risks will then ensure that the company's strategic and operational targets can be reached as intended.
The Board of Directors carries the main responsibility for risk assessment and monitoring the implementation of risk management. The President & CEO works with the parent company's operative management and subsidiaries' managers to ensure that the Group's risk management is duly arranged. The parent company's operative management is responsible for identifying and managing the risks involved within each business area, while subsidiaries' Management Teams are responsible for those in their own market areas.
Risk management is one of the areas covered by Biohit's internal control processes, which regularly monitor the risks associated with the company's business operations, identify any changes and, if necessary, take appropriate action to hedge against them. Risk management focuses on ensuring the continuity of business operations and preventing financial misconduct.
Internal control measures are integrated into the Group's general business management and reporting process. The subsidiaries report on business and earnings trends and the most significant deviations to Group Management on a monthly and quarterly basis. The Group's Management Team reports to the Board of Directors on the overall development of business; these two bodies, together with the President & CEO, decide on overall corporate strategies and procedures guiding the operations of the Group.
The subsidiaries' Boards follow business developments and ensure that the parent company's approved instructions and guidelines are followed. As a rule, the Boards of Directors of the subsidiaries meet monthly. Board work in the subsidiaries is based on financial reports and the written monthly and annual reports drawn up by subsidiary management.
Biohit's business control is carried out in accordance with the management system described above. The company provides the reporting systems necessary for business and financial management. The financial
department of the parent company provides instructions for drawing up annual and interim financial statements and prepares the consolidated financial statements.
The parent company's financial department retains central control of funding and administrative matters within the framework of the instructions provided by the Board of Directors and the President & CEO, and is also responsible for the management of interest and exchange rate risks. The Managing Directors of the subsidiaries ensure that the subsidiaries' reporting is carried out in accordance with the instructions given by the Group's Management Team.
The parent company's administration department controls and provides instructions on Group-level personnel policies and any agreements made within the Group.
Biohit aims to provide all of its stakeholders with information about the company's operations in a proactive, consistent and timely manner. The company seeks to take the special requirements and interests of all its stakeholders into account in its communications in order to increase confidence in the company and thereby promote its business operations. Biohit's Board of Directors has approved an information release policy with a view to ensuring the accuracy and reliability of any information released. The policy also specifies who is responsible for communications in different situations.
Biohit's financial department regularly provides information on processes related to financial administration reporting. This ensures the real-time availability of data, which is a prerequisite for efficient internal control. Financial administration guidelines and the company's information release policy aim to ensure the promptness and comprehensiveness of communications and the release of information required for internal control purposes.
The efficiency of internal controls on financial reporting is overseen by the Board of Directors, the President & CEO, Management Team members, and the Managing Directors of subsidiaries. Control focuses on following weekly and monthly financial reports and forecasts, and analysing any deviations from business plans. Monitoring is performed at all Board and Management Team meetings where reports are reviewed. It is supported by regular contact between Group Management and the company's auditor, and analysis of any deviations, which occurs at least once per quarter.
The audit frameworks for the Group's subsidiaries and key audit areas are jointly defined by the Group's financial management and the chief auditor. Biohit has not appointed a separately organised function for internal auditing purposes. The Group's financial management holds primary responsibility for the practical implementation of the internal audit.
The Group has all the internal control reporting systems required for financial management and monitoring business development. The reporting systems produce monthly financial data, so that financial management can ensure compliance with the parent company's approved instructions on matters such as authorisation.
The Group's auditor and the auditors of each subsidiary evaluate the effectiveness of the internal control system both in connection with the external audit and through spot checks throughout the financial year.
The auditor elected by the AGM is responsible for Biohit's statutory audit. According to the Articles of Association, the company must have one auditing body approved by the Central Chamber of Commerce. Biohit's auditor in 2015 was authorised public accountants PricewaterhouseCoopers Oy, with Pasi Karppinen, Authorised Public Accountant, as chief auditor.
The Group's invoiced auditors' fees for the 2015 financial year totalled EUR 52,000 (EUR 67,000 in 2014). The auditors' fees of subsidiaries totalled EUR 13,000 in the financial period (EUR 9,000 in 2014). In addition to this, PricewaterhouseCoopers Oy was paid a total of EUR 6,000 for other services (EUR 32,000 in 2014).
Biohit applies the Guidelines for Insiders approved by Nasdaq OMX Helsinki Ltd, as well as any relevant amendments.
Biohit's President & CEO is responsible for insider control. He ensures that people who handle insider information are aware of insider regulations and adhere to trading restrictions. Insiders are not allowed to trade Biohit Oyj securities for 21 days before the publication of the company's financial statement bulletin and interim reports. Insiders participating in projects are not allowed to sell or buy shares in Biohit before an announcement has been made of the continuation or discontinuation of a project.
Information on the shareholdings of Biohit's insiders and their trading activity is available on Biohit's website at www.biohithealthcare.com/investors.
The focus of Biohit's operational development is to acquire new distributors and customers, particularly via international partnerships. Our key objective is to create a strong and motivated global distributor network.
We will continue to invest in sales and marketing, building distribution channels and developing distributor collaboration. Our most important products are Acetium, GastroPanel and diagnostic quick tests. Our main market areas are Europe and Asia.
In 2015, Biohit's net sales increased by 38.7% over the previous year. Biohit's balance sheet provides a good foundation for building the business and exploiting the great potential of the products. Our company's equity ratio at the end of 2015 was 87.9% (87.5%) and the company had EUR 7.2 million in current assets (EUR 10.4 million).
| 1–12/2015 | 1–12/2014 | |
|---|---|---|
| Net sales, EUR million | 6.1 | 4.4 |
| Operating profit/loss, continuing operations, EUR million | –2.9 | –4.5 |
| Profit/loss before taxes, EUR million | –2.9 | –4.3 |
| Profit/loss for the period, continuing operations, EUR million | –2.9 | –4.4 |
| Profit/loss for the period, discontinued operations, EUR million | 3.3 | |
| Profit/loss for the period, EUR million | –2.9 | –1.2 |
| Average number of personnel | 52 | 50 |
| Number of personnel at the end of the period | 49 | 51 |
| Equity ratio, % | 87.9% | 87.5% |
| Earnings per share, continuing operations, EUR | –0.20 | –0.32 |
| Earnings per share, discontinued operations, undiluted, EUR | 0.23 | |
| Earnings per share, discontinued operations, diluted, EUR | 0.22 | |
| Shareholders' equity per share, EUR | 0.72 | 0.90 |
| Average number of shares during the period | 14,276,519 | 13,941,286 |
| Number of shares at the end of the period | 14,348,533 | 14,135,593 |
Biohit's product portfolio consists of diagnostic tests, analysis systems, products that bind carcinogenic acetaldehyde into harmless compound, monoclonal antibodies and service laboratory operations. The company classifies its entire product and service portfolio into one segment.
Net sales increased by 38.7% year-on-year. International operations continued to account for a large proportion of net sales: 88.3% (91.5%). Operating income was EUR –2.9 million (EUR –4.5 million).
In connection with the sale of the liquid handling business in late 2011, EUR 3.5 million of profit from the sale was not recognised in accordance with the contractual terms of the transaction and other unresolved matters related to the transaction. This sum was recognised on 31 March 2014 when the transaction was concluded.
| EUR million | 2015 | 2014 |
|---|---|---|
| Net sales | 6.1 | 4.4 |
| Total | 6.1 | 4.4 |
| EUR million | 2015 | 2014 |
|---|---|---|
| Group operating | ||
| income | –2.9 | –4.5 |
| Total | –2.9 | –4.5 |
The balance sheet sum on 31 December 2015 was EUR 11.7 million (EUR 14.5 million). Biohit's balance sheet provides a good foundation for building the business and exploiting the great potential of the products. Our company's equity ratio at the end of 2015 was 87.9% (87.5%).
The company's financial position is good and it allows for investment in building an international distributor network, as well as in developing and commercialising new products. The company's liquidity is good. At the end of the financial period, the company's financial assets amounted to EUR 7.2 million (EUR 10.4 million).
The company's research and development activities focus on innovation, developing products and improving usability. The company also uses external experts and subcontractors in its research and development operations. Development expenditure has not been capitalised. Research and development expenditure in 2015 amounted to EUR 2.0 million (EUR 2.1 million).
Gross investments in 2015 totalled EUR 0.2 million (EUR 0.5 million). The most significant investments in the financial period were related to purchasing equipment to automate production.
During the reporting period, the average number of personnel employed by the Group was 52 (50 in 2014), of whom 44 (41) were employed by the parent company and 8 (9) by subsidiaries. At the end of 2015, the Group employed 49 (51) personnel, of whom 40 (42) were employed by the parent company and 9 (9) by subsidiaries.
The company's key risk factors are related to investments required to enable business growth, as well as the sufficiency of financial resources to execute these investments over the medium term. These risk factors include success in clinical trials, selecting and developing new market areas and distribution channels, recruitment, registration procedures and product pricing, as well as risks related to political decision-making that may affect the progress of screening programmes. The key short-term risk factors are success in selecting new market areas and timing of the expansion into these areas, as well as the reception obtained by the products. Uncertainty factors have increased in recent times in international politics and these may have an unfavourable impact on the business.
The duration of product registration procedures varies from one market area to the next and affects the favourable development of the business. It is not possible to accurately estimate the amount of processing time needed for authorities to complete registrations in these areas.
The aim of the investment activities related to the company's liquid assets is to achieve profit at very
low risk of capital loss. The investment portfolio consists of deposits, money market investments and corporate loans. Sufficient distribution of investments between asset categories, investment instruments and counterparties is essential. The company uses at least two partners in its investment activities.
The portfolio of customers is diverse. The company is not dependent on individual customers or project deliveries to a significant extent. One exception to this is sales of GastroPanel in China, which are currently highly significant for Biohit. The majority of the company's business is denominated in euro and exchange rate fluctuations are not considered to have a material impact.
In collaboration with its distributors and licensing partners, Biohit has product registrations pending in several different market areas, which will affect trends in net sales. Several registration processes are expected to be concluded in 2016. Additionally, negotiations are ongoing with new partners – including negotiations to initiate significant screening projects – but there are several types of political risk affecting the progress of these.
A material factor in Biohit's cost structure is a major investment in studies, which will enable further evidence of the functionality of Biohit's diagnostic tests to be obtained in various clinical settings and in population-based screening. Acetium double-blind study was completed in 2015 to assess the effectiveness of the product in new usage indications. These studies will also continue in 2016. A project to unify the GastroPanel test kit was completed in 2015, along with investments in production in Finland. These strategically significant new projects will require major additional investments in 2016.
Biohit Biotech (Hefei) Co Ltd is expected to commence production in 2016. The factory is currently producing validation batches in accordance with the requirement of authorities and after approval the factory can start producing GastroPanel kits for the Chinese market. The company has also started recruitment of sales personnel.
We aim to grow profitable and are strongly committed to taking necessary actions in order to build a profitable future for the company. Net sales growth is expected in 2016. The company does not assess when the result of its continuing operations will turn to positive.
In 2015, Biohit's net sales increased by 38.7% over the previous year. The focal areas of Biohit Oyj's business development were expanding the international distributor network and supporting partners in processes such as product registration. A further focus was developing and increasing service sales in Finland and commercialising new products. We continued to work on increasing the awareness of carcinogenic acetaldehyde among decision-makers, doctors and the general public.
We continued to expand our distributor network by making new agreements and rearranging existing agreements. In the fourth quarter of 2015, we made an agreement concerning the distribution of Acetium lozenges with Birtely Pharma (United Arab Emirates), agreements on distributing Acetium with Queenslabs Lda (Portugal) and Biomed S.A. (Spain), as well as an agreement on distributing the ColonView test with Zhejiang Co. Ltd (China).
Additionally, we made the following agreements in 2015 concerning the distribution of diagnostics: Melon OOO (Kazakhstan), Biohemed doo (Serbia, Bosnia and Herzegovina, and Montenegro), Arium Sistemas de Diagnòstico Lda (Portugal), Gulf Drug LLC (United Arab Emirates), PT. InoDia (Indonesia), Mekalasi (Finland), Humasis (Korea), HealthLife (Kuwait). We made the following agreements concerning the distribution of Acetium: Oriola Oy (Finland), Oriola Oy (Baltic states), LS Pharma (Italy), Daiichi Sankyo Thailand Ltd (Vietnam, Laos, Cambodia and Myanmar), El-Alawia Medical Agencies (Sudan). Additionally, we expanded the distribution of Acetium lozenges in Finland to the dental care sector by entering into collaboration with Hammasväline Oy.
During 2015 the registration of Acetium capsule was completed in China, where our partner, GrandPharma, will begin selling capsules under the Shubang brand.
The capsule that binds acetaldehyde to form a harmless compound was registered as a food supplement in Mexico. In the fourth quarter of 2015, registration of the Acetium capsule was completed in Nigeria and Kuwait, and registration of quick tests was also completed in Kuwait. By and large, the duration of product registration processes varies depending on the market area. For this reason, it is not possible to accurately estimate the amount of processing time needed for authorities to complete registrations in different countries and for product sales to begin.
In 2015, the three GastroPanel tests (pepsinogen I and II, gastrin-17) received price approval decisions in four Chinese provinces: Jilin, Liaoning, Jiangsu and Inner Mongolia. Price approval decisions have now been made in 11 provinces. Price approval decisions are a prerequisite for compensation to be paid for GastroPanel and for sales to begin.
We reached a major milestone in our research and development activities by completing work to unify the GastroPanel test. GastroPanel can now be made more easily and cost-efficiently as a part of basic health care and screening.
We expanded our product range by adding vitamin D tests carried out using blood samples, as well as quick test readers that enable Biohit ColonView quick tests and Biohit's quick tests for coeliac disease to be used effectively at the point of care. The Acetium product family was expanded with the addition of a new salty liquorice flavoured lozenge. We also refreshed the packaging of Acetium products.
Biohit expanded its pharmacy campaigns across Finland. The pharmacy campaigns offer diagnostic testing of the gastrointestinal tract to enable diseases to be diagnosed and prevented at an early stage. In Helsinki, the Ympyrätalo pharmacy offers a corresponding service to its customers as part of its permanent service offering. We also began using an electronic appointment-booking system in Finland.
The Association for Finnish Work granted the right for its key flag symbol to be used for Acetium capsules and lozenges. The key symbol indicates that the products are of Finnish origin.
We continued our work to advance treatment practices, particularly cancer screening. In China, two gastric cancer screening studies began, using Biohit Oyj's GastroPanel test. The first screening study is a project run by the National Clinical Research Center for Digestive Diseases (Changai hospital) and funded by China's Ministry of Science and Technology. The Ministry is organising a multi-centre study to screen for the risk of early gastric cancer. At least 20,000 people will be screened at approximately 50 hospitals. Screening is set to end in December 2016.
A second study is being organised by the China Health Promotion Foundation in public health care facilities in China. The Foundation is a public organisation that is managed by China's Ministry of Health. The study involves screening about half a million asymptomatic people aged between 40 and 80. Collection of samples began in summer 2015.
Russia began a pilot project to screen for colorectal cancer among asymptomatic people aged between 48 and 75. About 20,000 people will be screened as part of the project. The results of the study will be used to select a screening test for the project. One of the options is Biohit Oyj's ColonView test. The screening project is being arranged in local public health care centres. The Russian federal government is responsible for organising and financing the project.
Biohit Oyj concluded its first study of almost two years in duration on smoking intervention in November 2015. Preliminary observations indicate that Acetium lozenges, which contain slow-release L-cysteine, are a promising novel method for helping people to quit smoking. This is a significant new indication of the product's potential benefits in addition to the fact that it does not have side-effects of the type present in pharmaceuticals and nicotine-based products and it binds acetaldehyde dissolved into saliva from cigarette smoke to form a harmless compound promoting oral health.
The results of studies related to carcinogenic acetaldehyde and cancer screening highlight the fact that our offering plays an important role in the prevention and early diagnosis of societally significant diseases, particularly those suffered by ageing populations. Prevention and early diagnosis can lead to cost savings.
An international study comparing colorectal cancer screening tests was completed. The results indicated that Biohit Oyj's ColonView, specific for human blood, is superior to the conventional tests in colorectal cancer screening due to its sensitivity and specificity. The scientific report was published in an international cancer journal Anticancer Research.
A new study was presented at a convention organised by the European Society for Biomedical Research on Alcoholism (ESBRA). The study evaluated the effect of Acetium lozenges on the concentration of acetaldehyde in saliva following consumption of alcoholic drinks containing small and large amounts of acetaldehyde. Acetium lozenges provided promising results in terms of eliminating carcinogenic acetaldehyde from saliva.
The PLOS ONE series of publications released the results of a Japanese-Finnish study showing that acetaldehyde is a significant pathophysiological factor in the onset of gastric cancer. According to Professor Helmut K. Seitz, professor of internal medicine, gastroenterology and alcohol research at the University of Heidelberg, the study demonstrates for the first time the significance of acetaldehyde in the onset of gastric cancer.
Acetium is being used in a Japanese cancer study. According to Professor Katsunori Iijima, senior physician at the Akita University Hospital, the product may represent a significant way of preventing cancer. His new studies will evaluate the effect of Acetium on concentrations of acetaldehyde within mucous membranes in the oesophagus and stomach, and the potential effect of this on the prevention of cancer recurrence among high-risk patients. Professor Iijima's working group is also using the GastroPanel test developed by Biohit Oyj to evaluate the risk of cancer among these patients.
A proposal by the European Parliament's Environment, Public Health and Food Safety (ENVI) committee was approved in May 2015. The proposal includes key factors related to acetaldehyde. As part of the proposal, the European Parliament called upon the Commission to immediately request that the European Food Safety Authority (EFSA) re-evaluate the use of acetaldehyde as a flavouring agent in alcoholic and non-alcoholic drinks.
An unofficial group of members of the European Parliament, MEPs Against Cancer, arranged a hearing of experts on alcohol and cancer. The hearing was attended by experts from the European umbrella organisation representing cancer organisations (the European Cancer League) and from the European Alcohol Policy Alliance Eurocare, which coordinates alcohol policy in member states. The expert hearing was arranged due to the resolution related to the European Parliament's alcohol strategy, which involved acetaldehyde.
In the light of present knowledge, the packaging of alcoholic drinks should include labelling stating that the product may contain acetaldehyde, which is classified by the World Health Organisation as a cancer risk to humans. As there is no scientific evidence to indicate that the acetaldehyde and ethanol contained in other foodstuffs represents less of a cancer risk than the acetaldehyde in alcoholic drinks, the same requirements should also apply to these products. Several foodstuffs have an acetaldehyde content in excess of 5mg/l. (www.biohithealthcare.com/ Laboratory-Services: Determination of Acetaldehyde - Measure Acetaldehyde content in food)
In 2012, a scientific committee set up by the EU proposed that the acetaldehyde content of cosmetic products should be less than 5mg/l and that mouthwashes should not contain any acetaldehyde.
In 2015, Biohit Oyj issued a total of 60,000 options belonging to option class I 2013C to members of the company's Management Team under the I 2013 option scheme.
In its final meeting of the year, the Board of Directors decided that the company will change its financial
communications schedule as of the beginning of 2016. In the future, Biohit Oyj will publish financial reviews twice per year.
| 1–12/2015 | 1–12/2014 | |
|---|---|---|
| Net sales, EUR million | 6.1 | 4.4 |
| Year-on-year change, % | 38.7% | 26.4% |
| Operating income, continuing operations, EUR million |
–2.9 | –4.5 |
| Year-on-year change, % | 35.6% | –23.1% |
| Operating income, % of net sales |
–48% | –103% |
Biohit Oyj and Genetic Analysis AS signed an agreement on a share transfer between the companies by which Biohit Oyj took ownership of 18% of the company's share capital. The parties also signed a distribution agreement by which Biohit Oyj received the right to sell Genetic Analysis AS' Dysbiosis assay globally under the Biohit brand, with exclusive rights in Finland and China. Genetic Analysis will operate as a distributor of Biohit Oyj's products and services in Norway.
In consideration for the agreement, Biohit Oyj transferred 350,000 new series B shares in Biohit Oyj to Genetic Analysis AS. The new series B shares were registered with the trade register on 12 February 2016. As of the date of registration, they entitle their holders to the same rights as the company's previous series B shares. The new shares became tradable on the Nasdaq OMX Helsinki stock exchange together with old series B shares on 15 February 2016. The arrangements related to the share transfer have been concluded and new shares in Genetic Analysis AS have been registered in Biohit Oyj's name.
Biohit Oyj initiated a confirmatory smoking intervention trial in collaboration with the Kuulas Helsinki research
agency. The aim of the study is to confirm the promising results obtained in the previous study related to smoking cessation. If successful, the trial will provide sufficient statistical power to confirm that the Acetium lozenge is a breakthrough in the development of smoking intervention methods. At least 1,800 smokers will be invited to voluntarily participate in the trial. The trial has begun and it is expected to be completed in 2016.
The Annual General Meeting (AGM) held on 20 April 2015 decided in accordance with the proposal by the Board of Directors that no dividend would be paid for the financial period that ended on 31 December 2014.
The AGM decided that the Board of Directors would have six (6) members and selected the following Board members to serve until the end of the next AGM: current members: Professor (h.c.) Osmo Suovaniemi, MD, PhD; Professor Mikko Salaspuro, MD, PhD; Eero Lehti, MSc (Soc. Sci.), Commercial Counsellor, Dr.h.c. (Econ.); Seppo Luode, MSc (Tech.), MBA; Franco Aiolfi, holder of a degree in pharmacy, managing director; and Janina Andersson, MSc (Soc. Sci.) as a new member.
The AGM selected PricewaterhouseCoopers Oy, a firm of Authorised Public Accountants, to act as the company's auditor.
Biohit's Management Team consists of the following people: Semi Korpela, President & CEO; Niklas Nordström, CFO; Lea Paloheimo, Business Development Director; Annika Astola, Quality Director; Panu Hendolin, R&D Director; Anu Mickels, Sales and Marketing Director; and Kari Syrjänen, Chief Medical Director.
The number of shares in Biohit Oyj is 14,348,533 (14,135,593), of which 2,975,500 (2,975,500) belong to series A and 11,373,033 (11,160,093) belong to series B. Biohit Oyj's series B shares are listed on Nasdaq OMX Helsinki in the Small cap/Health care segment under the symbol BIOBV.
Assuming that the market capitalisation value for series A shares is the same as for series B shares, the total market capitalisation at the end of the review period was EUR 80.5 million (EUR 66.2 million on 31 December 2014). Share turnover during the period amounted to EUR 22.6 million.
| 1–12/2015 | 1–12/2014 | |
|---|---|---|
| High, EUR | 7.14 | 8.17 |
| Low, EUR | 4.22 | 4.57 |
| Average, EUR | 5.45 | 6.35 |
| Latest, EUR | 5.61 | 4.68 |
| Turnover, EUR | 22,618,230 | 25,927,811 |
| Turnover, volume | 4,014,402 | 4,028,617 |
At the end of the review period on 31 December 2015, the company had 6,594 shareholders (6,841 shareholders on 31 December 2014). Private households held 78.0% (77.9%), companies 20.1% (20.1%) and publicsector organisations 0.0% (0.0%) of the shares. Foreign ownership or nominee registrations accounted for 1.7% (1.8%) of all shares.
Further information on the shares, major shareholders and management's shareholdings is available in the notes to the financial statements and on the company's website at
www.biohithealthcare.com/investors.
On 31 December 2015, the parent company's distributable assets (unrestricted equity) amounted to EUR 6,079,716.06 (EUR 9,132,650.85), including the loss for the financial period of EUR 3,526,862.99 (loss of EUR 550,514.94). The Board of Directors proposes
to the Annual General Meeting that no dividend be distributed by the company for the financial period.
Biohit Oyj's Annual General Meeting is intended to be held in Helsinki on Monday 25 April 2016 at 3pm. The Annual General Meeting will be convened by the company's Board of Directors at a later date.
All figures have been rounded up or down, so the sums of individual figures may deviate from the totals shown.
Biohit Oyj publishes a separate Corporate Governance Statement on its website at the following address: www.biohithealthcare.com/investors: Corporate Governance - Biohit's Corporate Governance Statements
Helsinki, 25 February 2016 Biohit Oyj Board of Directors
| 1 Jan–31 Dec | 1 Jan–31 Dec | ||
|---|---|---|---|
| 1,000 € | Note | 2015 | 2014 |
| Net sales | 3 | 6,051 | 4,363 |
| Acquisition and production expenses | 6 | –2,855 | –1,924 |
| Gross margin | 3,196 | 2,440 | |
| Other operating income | 5 | 757 | 245 |
| Sales and marketing expenses | 7 | –2,341 | –2,058 |
| Administrative expenses | 8 | –2,405 | –3,063 |
| Production and development expenses | 9 | –2,038 | –2,067 |
| Share of the profit/loss of joint venture | 10 | –70 | – |
| Operating profit/loss | –2,900 | –4,504 | |
| Financial income | 14 | 238 | 250 |
| Financial expenses | 14 | –241 | –58 |
| Financial income and expenses | –3 | 192 | |
| Profit/loss before taxes | –2,903 | –4,312 | |
| Income taxes | 15 | –14 | –105 |
| Profit/loss for the period | –2,917 | –4,417 | |
| Income for the period, discontinued operations | 3,257 | ||
| Available-for-sale financial assets | –158 | 81 | |
| Translation differences | 7 | 0 | |
| Comprehensive income to be recognised through profit or loss | –151 | 81 | |
| Total comprehensive income for the period | –3,068 | –1,080 | |
| Distribution of profit/loss for the period | |||
| to equity holders of the parent company | –2,917 | –1,161 | |
| Total | –2,917 | –1,161 | |
| Distribution of comprehensive income | |||
| to equity holders of the parent company | –3,068 | –1,080 | |
| Total | –3,068 | –1,080 | |
| Earnings per share, diluted and undiluted, EUR | 16 | –0.20 | –0.32 |
| Undiluted earnings per share, discontinued operations, EUR | 16 | – | 0.23 |
| Diluted earnings per share, discontinued operations, EUR | 16 | – | 0.22 |
| 1,000 € | Note | 31 Dec 2015 | 31 Dec 2014 |
|---|---|---|---|
| ASSETS | |||
| Non-current assets | |||
| Intangible assets | 17 | 1,396 | 1,607 |
| Tangible assets | 18 | 782 | 857 |
| Ownership stake in joint ventures | 19 | 596 | – |
| Other financial long-term assets | 20 | 2 | 4 |
| Deferred tax assets | 21 | 77 | 30 |
| Total non-current assets | 2,853 | 2,497 | |
| Current assets | |||
| Inventories | 22 | 637 | 816 |
| Trade and other receivables | 20, 23 | 997 | 775 |
| Other financial short-term assets | 20, 24 | 6,518 | 9,811 |
| Cash and cash equivalents | 20, 24 | 723 | 608 |
| Total current assets | 8,875 | 12,011 | |
| Total assets | 11,728 | 14,508 |
| Shareholders' equity | Note | 31 Dec 2015 | 31 Dec 2014 |
|---|---|---|---|
| Share capital | 25 | 2,350 | 2,350 |
| Invested unrestricted equity fund | 25 | 2,367 | 1,882 |
| Translation differences | 25 | 12 | 5 |
| Retained earnings | 5,581 | 8,439 | |
| Shareholders' equity attributable to parent company shareholders | 10,310 | 12,677 | |
| Total equity | 10,310 | 12,677 | |
| Non-current liabilities | |||
| Deferred tax liabilities | 21, 28 | 176 | 200 |
| Other liabilities | 20, 28 | 4 | 3 |
| Total non-current liabilities | 180 | 203 | |
| Current liabilities | |||
| Trade payables | 20, 28 | 326 | 529 |
| Current interest-bearing liabilities | 20, 27 | 128 | 256 |
| Tax liabilities | 20, 28 | – | 54 |
| Other liabilities | 20, 28 | 785 | 789 |
| Total current liabilities | 1,239 | 1,628 | |
| Total equity and liabilities | 11,728 | 14,508 |
| 1,000 € | Shareholders' equity attributable to parent company shareholders | |||||
|---|---|---|---|---|---|---|
| Share capital |
Invested unrestricted equity fund |
Translation differences |
Fair value reserve |
Retained earnings |
Total equity |
|
| Shareholders' equity 1 Jan 2015 | 2,350 | 1,882 | 5 | 194 | 8,245 | 12,677 |
| Management incentive system | – | – | – | – | 216 | 216 |
| Exercise of share options | – | 485 | – | – | – | 485 |
| Total comprehensive income for the period |
– | – | 7 | –158 | –2,917 | –3,068 |
| Shareholders' equity on 31 Dec 2015 | 2,350 | 2,367 | 12 | 36 | 5,544 | 10,310 |
| 1,000 € | Shareholders' equity attributable to parent company shareholders | |||||
|---|---|---|---|---|---|---|
| Share capital |
Invested unrestricted equity fund |
Translation differences |
Fair value reserve |
Retained earnings |
Total equity |
|
| Shareholders' equity 1 Jan 2014 | 2,348 | 2,750 | 5 | 113 | 17,234 | 22,450 |
| Distribution of dividend | – | – | – | – | –9,988 | –9,988 |
| Management incentive system | – | –1,610 | – | – | 2,159 | 549 |
| Exercise of share options | 3 | 742 | – | – | – | 745 |
| Total comprehensive income for the period |
– | – | 0 | 81 | –1,161 | –1,079 |
| Shareholders' equity 31 Dec 2014 | 2,350 | 1,882 | 5 | 194 | 8,245 | 12,677 |
| 1,000 € Note |
2015 | 2014 |
|---|---|---|
| Cash flow from operating activities | ||
| Profit/loss for the period | –2,917 | –1,161 |
| Adjustments to profit for the period Non-cash transactions |
–326 | –2,661 |
| Depreciation | 319 | 231 |
| Unrealised exchange rate gains and losses | 3 | –2 |
| Financial income and expenses | 0 | –190 |
| Income taxes | 14 | 105 |
| Total adjustments to profit for the period | 9 | –2,517 |
| Change in working capital | ||
| Increase (–) or decrease (+) in current non-interest-bearing trade | ||
| receivables | –213 | 151 |
| Increase (–) or decrease (+) in inventories | 178 | –148 |
| Increase (+) or decrease (–) in current non-interest-bearing liabilities | –137 | 204 |
| Total change in working capital | –172 | 207 |
| Interest paid | –212 | –44 |
| Interest received | 223 | 210 |
| Realised exchange rate gains and losses | –21 | –14 |
| Income taxes paid | –59 | –117 |
| Net cash flow from operating activities | –3,147 | –3,435 |
| Cash flow from investing activities | ||
| Investments in tangible and intangible assets | –223 | –401 |
| Revenue from disposal of tangible and intangible assets | 80 | 12 |
| Capital gains from investments in funds and deposits | 3,034 | 6,516 |
| Capital gain from the sale of liquid handling business | – | 6,814 |
| Net cash flow from investments | 2,891 | 12,941 |
| Cash flow from financing activities | ||
| Rights issue | 485 | 751 |
| Dividend paid and other profit distribution | 0 | –9,991 |
| Repayment of loans | –128 | –128 |
| Net cash flow from financing activities | 357 | –9,369 |
| Change in cash and cash equivalents | 101 | 137 |
| Cash and cash equivalents at the beginning of the period | 608 | 467 |
| Effect of exchange rates | 14 | 4 |
| Cash and cash equivalents at the end of the financial period 24 |
723 | 608 |
Biohit Oyj is a Finnish public limited company that manufactures products that bind acetaldehyde, diagnostic products and systems for diagnostic analysis for the use of research institutions, health care and industry. The parent company's domicile is Helsinki, Finland.
A copy of the consolidated financial statements is available on the website, www.biohit.fi and at the headquarters of the Group's parent company at Laippatie 1, Helsinki, Finland.
Biohit Oyj's Board of Directors approved the financial statements for publication on 25 February 2016. In accordance with the Finnish Limited Liability Companies Act, shareholders have the opportunity to approve or reject the financial statements at the Annual General Meeting, which is to be held after the financial statements have been published. At the Annual General Meeting, it is also possible for a decision to be made to alter the financial statements.
These financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) endorsed by the European Union. The IAS and IFRS standards that were valid on 31 December 2015 have been followed, as well as SIC and IFRIC interpretations. The IFRS refer to standards and interpretations thereof approved for application in the EU in compliance with the proceedings stipulated in Regulation (EC) 1606/2002, as referred to in the Finnish Accounting Act and subsequent regulations. The notes to the consolidated financial statements also comply with Finnish accounting and corporate legislation.
The consolidated financial statements have been prepared on the basis of acquisition cost with the exception of available-for-sale investments and
financial assets and liabilities measured at fair value through profit or loss. The financial statements are presented in thousands of euros. The figures presented in the financial statements are rounded from precise figures, so the combined total of individual figures may differ from the total sum presented. Indicators have been calculated using precise values.
The preparation of IFRS-compliant financial statements requires the Group management to make certain estimations and judgments when applying the Group's accounting policies. Information on judgements that the management has made when applying the Group's accounting principles and that have the most significant effect on the figures presented in the financial statements are presented under "Accounting policies calling for judgements by the management and key sources of estimation uncertainty".
The Group's income statement is presented as a single calculation in which the share of the income accounted for by the Group's ongoing operations is presented first and income due to discontinued operations is then presented on a single line.
The consolidated financial statements include the parent company, Biohit Oyj, and all of its subsidiaries. Subsidiaries are companies over which the Group has control. The Group has a controlling interest in a company if, by being involved in the company, it is exposed to fluctuating returns or is entitled to such fluctuating returns and it is able to influence these returns by exercising its control over the company.
Mutual shareholdings of Group companies have been eliminated using the acquisition cost model. Acquisition costs include transferred assets at fair value, generated or assumed liabilities and equity-based instruments
that are issued. Acquired subsidiaries are consolidated from the moment that the Group gains control over them and divested subsidiaries are consolidated until this control ends. All internal Group business transactions, receivables, liabilities, unrealised profits and internal profit distribution are eliminated when preparing the consolidated financial statements. Unrealised losses are not eliminated if the loss results from impairment. The distribution of profits for the financial period to the parent company's owners and minority interest-holders is presented in the income statement, and the minority interest-holders' share of equity is presented as a separate item in the balance sheet under equity. The minority interest-holders' share of accumulated losses is recognised in the consolidated financial statements up to the amount of the investment. The Group has no associated companies.
Subsidiaries are consolidated into the financial statements from the moment that the Group gains control over them until this control ends. The consolidated financial statements have been prepared using the acquisition-cost method. The Group's share of assets, liabilities and contingent liabilities on the date of acquisition is recognised at fair value and the amount in excess of the fair-value acquisition cost is recognised as goodwill. If the acquisition cost of a subsidiary is less than the value of the net assets on the date of acquisition, the difference is recognised in the income statement. Internal Group business transactions, receivables, liabilities and unrealised profits from internal sales are eliminated in the consolidated financial statements. Unrealised losses are also eliminated unless an internal business transaction demonstrates that an asset has become impaired. The share of a subsidiary owned by minority interestholders is presented in the consolidated balance sheet under equity, separately from shareholders' equity. The accounting principles applied by subsidiaries have been adapted to correspond to the Group's principles.
The Group has applied IFRS 11 to all of its joint arrangements. Under IFRS 11, joint arrangements are classified as joint operations or joint ventures in accordance with the investors' contractual rights and obligations. The Group has assessed the nature of its joint arrangements and determined that they are
either joint ventures or joint operations. Joint ventures are consolidated using the equity method. When the equity method is used, shares in joint ventures are initially recognised at acquisition cost and this amount is increased or decreased by entering the Group's share of the subsequent profits or losses and other items of comprehensive income. If the Group's share of a loss made by a joint venture is as great as or greater than its interest in the joint venture (including any non-current receivables that actually constitute part of the Group's net investment in the joint venture), the Group will not recognise additional losses unless it has a legal or factual obligation to do so and it has not made payments on behalf of the joint venture. Business transactions between the Group and its joint arrangements give rise to unrealised profits, which are eliminated in accordance with the Group's ownership stake. Unrealised losses are also eliminated unless a business transaction indicates that the value of a transferred asset has become impaired.
The profit and financial position of the Group's units are measured in the currency of the main operating region of the unit in question. The consolidated financial statements are presented in euro, which is the functional and presentation currency of the Group's parent company.
Foreign currency business transactions are recorded in the functional currency at the exchange rate on the date of transaction. Monetary receivables and liabilities are translated at the exchange rate on the closing date of the financial period. Non-monetary foreign currency items have been translated into the functional currency at the exchange rates on the transaction date. Any exchange differences arising from translation are recognised in the income statement. Any exchange differences arising from the translation of accounts receivable and accounts payable within the Group are recognised as financial items, while corresponding external items are treated as sales or purchase adjustment items. The income statements of foreign subsidiaries have been translated into euro at the average exchange rate for the financial period and the balance sheets have been translated at the exchange rate on the closing date of the financial period. The exchange difference resulting from translating income statement items using the average exchange rate and
balance sheet items at the exchange rate on the closing date of the financial period has been recognised as a separate item under translation differences in equity. Exchange differences from monetary items calculated as net investments made in foreign subsidiaries are recognised as translation differences.
The company's product portfolio consists of diagnostic tests, analysis systems, products binding carcinogenic acetaldehyde into a harmless compound, monoclonal antibodies and service laboratory operations. The entire product and service portfolio is reported under a single segment.
Segment information is provided to the most senior operative decision-making body as part of internal reporting in a consistent manner. The Group's Management Team is the most senior operative decision-making body. It is responsible for allocating resources to business segments.
Revenue from sales of goods and services is recognised when the related material risks and benefits have been transferred to the purchasers and there is no significant uncertainty regarding payments or costs of goods and services, or any return of goods. The amount of booked income consists of the compensation from sold goods or services based on fair value, less value-added tax and volume or other discounts, as well as exchange rate profits and losses related to the sale. Interest income is recognised in accordance with the effective interest rate method. Dividend income is recognised when the right to the dividend is established.
Property, plant and equipment are recognised at original acquisition cost, less accumulated depreciation and impairments. Acquisition cost includes the direct costs arising from acquisition. Costs that arise subsequently are included in the book value of the asset or recognised as separate assets only if it is likely that the future financial benefit associated with the asset will benefit the Group and the acquisition cost of the asset can be reliably determined. Other repair and maintenance costs are recognised through profit or loss in the period during which they have materialised.
Straight-line depreciation is applied to assets according to the estimated useful life. No depreciation is made on land. The estimated useful lives are as follows:
| Buildings: | 20–30 years |
|---|---|
| Machinery and equipment: | 3–10 years |
The residual value and the useful life of assets are checked in every financial statement and, if necessary, adjusted to represent changes that have occurred in the expectations of financial benefit. Sales gains and losses accumulated from the disposal or transfer of tangible fixed assets are included in other operating income or expenses.
Research expenditure is recognised as an expense in the balance sheet. Development expenditure related to designing new and more advanced products is capitalised in the balance sheet as an intangible asset when the product can be technically realised and commercially exploited, and the product is expected to generate a future financial benefit. Development expenditure that has previously been recognised as an expense cannot be capitalised at a later date. Depreciation is booked for an asset from the time it is ready for use.
Intangible assets are only entered in the balance sheet if the acquisition cost of the asset can be reliably determined and if it is likely that the expected financial benefit from the asset will benefit the company. Other intangible assets with a limited useful life are entered in the balance sheet at original acquisition cost, and costs are booked in the income statement based on straight-line depreciation over the course of the known or estimated useful life of the asset. The Group has no intangible assets with indefinite useful lives.
The depreciation periods are as follows: Patents: 10 years Development expenditure: 5 years Computer software: 3 years Other intangible assets: 5–10 years
On the closing day of each financial period, the Group assesses whether there are indications of impairment in the value of a particular asset. If there are such indications, the recoverable amount from the said asset is estimated. Additionally, the recoverable amount is estimated annually for goodwill, regardless of whether there is any indication of impairment. The need for impairment is reviewed at the level of cash-generating units, that is, the lowest unit level that is largely independent of other units, and whose cash flow can be separated from other cash flows. The discount rate used is the interest rate that is determined before taxes and that describes the market's view of the time value of money and the risks incorporated in the tested asset.
The recoverable amount is the asset's fair value, less costs arising from transfer or a higher utility value. Value in use is the estimated future net cash flow from the asset or cash-generating unit, which is discounted to its present value. Impairment loss is recognised if the book value of the asset is higher than the recoverable amount. Impairment loss is recognised immediately in the income statement. If the impairment loss is allocated to a cash-generating unit, it is first allocated to reduce the goodwill of the cash-generating unit and then to reduce the other assets of the unit pro rata. The impairment loss is cancelled if there is a change in the conditions and the recoverable amount from the asset has changed since the impairment loss was booked. However, the impairment loss may not be reversed in excess of what the asset's book value would be without the recognition of the impairment loss. Impairment losses recognised for goodwill are never reversed.
Inventories are measured at acquisition cost or net realisable value, whichever is lower. The acquisition cost is determined using the FIFO method. The acquisition cost for finished and unfinished products consists of raw materials, direct labour costs, other direct costs, and the appropriate share of manufacturing-related variable overheads and fixed overheads at a normal level of operations. The net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs for completing the product and costs related to sales.
In Group companies, pension cover is arranged in accordance with the pension legislation and practices of the country in question. The pension arrangements are defined-contribution plans. The payments related to defined-contribution pension plans are recognised as costs in the financial period in which they arise.
The Group has incentive plans where payments are made in the form of equity instruments. The benefits granted under the plans are recognised at fair value on the date on which they were granted and entered as costs evenly throughout the period during which they were earned. The effect of the plans on profit or loss is presented under costs of employee benefits.
The cost determined on the date on which the options were granted is based on the Group's estimate of the number of options for which rights are presumed to arise at the end of the incentive-earning period. The Group updates the presumption of the final number of options on the final day of every reporting period. Changes in estimates are treated through profit or loss. The fair value of option plans is defined on the basis of the Black-Scholes option pricing model. Terms that are not market-based, such as profitability and specific growth targets, are not taken into consideration when determining the fair value of options. Instead, they affect the estimate of the final number of options.
When option rights are exercised, the assets obtained from share subscriptions are entered into the invested unrestricted equity fund in accordance with the terms of the plan.
A provision is entered when the Group has, due to a past event, a legal or factual obligation, and the obligation is likely to materialise and the sum of the obligation can be reliably estimated. The amount to be recognised as a provision corresponds to the best estimate of the costs required to meet existing obligations on the closing date of the financial period. If the time value of money has a material impact, the amount of the provision is recognised as the present value of anticipated expenses.
The tax expense in the income statement consists of the current tax expense and deferred tax. The amount of tax based on the taxable profit for the period is calculated from the taxable profit based on the applicable tax rate in each country. The tax is adjusted by possible taxes related to previous periods.
Deferred taxes are calculated from all temporary differences between the book value and tax base. The biggest temporary differences arise from the depreciation of property, plant and equipment, deferred tax assets and internal margins on inventory.
No deferred tax is recognised for non-deductible goodwill impairment or for the undistributed profits of subsidiaries if the temporary difference is not likely to dissolve in the foreseeable future.
Deferred tax is calculated using the tax rates enacted by the balance sheet date. Deferred tax assets are recognised to the amount for which it is likely that taxable profit will be generated in the future against which the temporary difference can be utilised.
The Group's financial assets are classified at fair value through profit or loss under financial assets, loans, financial assets held to maturity and other receivables, as well as under financial assets held for sale. The classification is made on the basis of the purpose of the acquisition and the assets are classified in connection with the original acquisition. All purchases and sales of financial assets are booked on the day of the transaction. Financial assets are derecognised when the Group has lost its agreement-based right to the cash flow or it has transferred a significant share of the risks and income outside the Group.
Financial assets booked at fair value through profit or loss include financial asset items that were acquired to be held for trading purposes or that are initially classified to be booked at fair value through profit or loss (applying the fair value alternative). Financial assets held for trading purposes consist of investments in fixed-term deposits and corporate loans and they are included in current and non-current assets. The items in this group are measured at fair value and the fair value of all of the investments in this group is determined based on price quotations on active markets, i.e., the buy quotation on the closing date of the financial period. Profits and losses due to changes in fair value and both unrealised and realised profits and losses are booked under financial items in the income statement for the period in which they arise.
Loans and other receivables are non-derivative assets with related costs that are fixed or can be determined, which are not noted on active markets and which the company does not hold for trading purposes. They are measured at amortised cost using the effective interest rate method. They are included in the balance sheet in current or non-current assets depending on
their nature: the latter if they fall due more than 12 months in the future. This group mainly consists of trade receivables.
Financial assets available for sale are non-derivative assets such as money market investments that have been specifically assigned to this category or that have not been assigned to any other category. Typically, investments are categorised as available for sale if there is no active market for them but the company can sell them if necessary. Investments classified in this group are measured at fair value and changes in value are entered into equity under items of comprehensive income. The profit or loss of an investment classified as available for sale is entered into income when the investment is sold or falls due. Any interest or dividend income is booked as income under financial items.
Cash and cash equivalents include cash in hand and at bank as well as other liquid investments with a maturity of less than three months.
Financial liabilities are booked at fair value based on the original consideration received in accounting. Transaction costs are included in the original book values of financial liabilities. All financial liabilities are later measured at amortised cost using the effective interest rate method. Financial liabilities are included in current and non-current liabilities and they can be interest-bearing or interest-free. Interest-bearing liabilities consist of financial liabilities for which the company must pay interest or other fees on the basis of a contract throughout the duration of the loan. Non interest-bearing liabilities consist of liabilities for which the company need not regularly pay interest or other fees on the basis of a contract. The principles for determining the fair values of financial liabilities are presented in note 20.
On each balance sheet date, the Group estimates whether there is objective proof of impairment of an individual financial asset or group of financial assets. If there is evidence of impairment, the impairment is recognised through profit or loss. If the impairment loss decreases in a later accounting period, the recognised loss is reversed through profit or loss unless it applies to an equity investment classified as an investment available for sale, in which case the impairment is not reversed through profit or loss.
The Group books impairment losses for trade receivables when there is reliable evidence to demonstrate that receivables cannot be collected in accordance with their original terms. The magnitude of the impairment loss to be recognised in the income statement is determined as the difference between the book value of the receivable and the present value of the estimated future cash flows discounted using the effective interest rate. If the impairment loss decreases in a subsequent financial period and the reduction can be objectively linked to a transaction that has taken place after the recognition of the impairment loss, the recognised loss is reversed through profit or loss.
40
IAS 1 Presentation of Financial Statements does not define the concept of operating profit. The Group has defined it as follows: operating profit or loss is a net total that can be calculated by adding other operating income to net sales, subtracting purchase expenses adjusted by the change in the stock of finished and unfinished products as well as expenses caused by production for own use, subtracting expenses from employee benefits, depreciation and potential impairment losses, as well as other operating expenses. All other items, including discontinued operations, are presented beneath operating profit or loss. Exchange differences and changes in the fair value of derivatives are included in operating profit or loss providing they arise from business-related items. Otherwise, they are recognised as financial items. Exchange differences related to the Group's internal receivables and liabilities are recognised as financial items.
When preparing the financial statements, the management must make assessments and assumptions concerning the future, and the outcome may deviate considerably from the original assessments and assumptions. In addition, discretion must be used in applying the accounting policies. Although the estimates are based on the most recent information available, the realised values may differ from these estimates. The most important areas in which estimates and discretion are used are described below.
The Group conducts impairment tests as required on unfinished intangible assets. It also assesses any indication of impairment in accordance with the aforementioned accounting policies. The recoverable amounts of cash-generating units are measured on the basis of value-in-use calculations. Preparing these calculations requires the use of estimates.
Deferred tax assets for unused tax losses and temporary differences in regard to recognised deferred tax assets are estimated by the Group at least once per year to determined the likelihood of the company in question generating sufficient taxable income before the unused tax losses expire.
Joint control of Biohit Biotech (Hefei) Co Ltd in accordance with the IFRS 10 standard took effect on 30 September 2015 (at the end of the review period) in the manner referred to in the standard and the shareholders' agreement. As such, the investment is recognised in accordance with the new standards as a consolidated entity in the balance sheet of Biohit's consolidated financial statements. It is recognised via the equity method. The consolidation gave rise to a non-recurring item in other business income in the amount of EUR 0.7 million. In the future, Biohit Oyj's share of the profit/loss of the joint venture will be recognised above operating profit.
Biohit will begin applying new or amended IFRS standards and interpretations as of the date on which they enter into force or when they are approved for adoption in the EU. The consolidated financial statements have been prepared in compliance with the same accounting principles as in 2014. The standards or interpretations that entered into force in 2015 have not given rise to material changes in the accounting principles.
Biohit has not yet applied the following new and amended standards and interpretations, which have already been published but have not been approved by the European Union. The Group intends to apply these on the date on which they enter into force or from the beginning of the following financial period if this date is not the first day of the financial period.
The amendments to IAS 1 are part of the IASB's "Disclosure Initiative" project. The amendments apply to the definition of materiality, combinations of items, the presentation of interim sums, the structure of financial statements and the presentation of accounting principles. The amendments will be applied to financial periods beginning on or after 1 January 2016.
IFRS 9 Financial Instruments handles the classification, valuation and recognition of financial assets and liabilities. It replaces the sections of IAS 39 applying to the calculation and valuation of financial instruments. In accordance with IFRS 9, financial assets must be classified into three valuation groups: assets recognised at amortised cost, assets recognised at fair value through other comprehensive income and assets recognised at fair value through the income statement. The group depends on the original method of recognition. The classification depends on the business model by which financial assets are managed, as well as the instrument's cash flow characteristics. As regards financial liabilities, the standard corresponds to several requirements in accordance with IAS 39. The most important amendment applies to situations in which financial liabilities have fair-value options. In these cases, the change in fair value due to the company's own credit risk is recognised under items of other comprehensive income rather than in the income statement unless this would lead to an accounting asymmetry. The standard will be applied to financial periods beginning on or after 1 January 2018. Earlier application is permitted. If the company opts for early adoption, it must apply all of the requirements at the same time. The standard has not yet been approved by the EU.
IFRS 15 Revenue from contracts with customers determines how and when companies complying with IFRS standards recognise revenue. The standard also requires companies to provide users of financial statements with more informative and substantive information. The standard offers a common, principleoriented, five-phase model to be applied to all customer contracts. IFRS 15 was published in May 2014 and it will be applied to financial periods beginning on or after 1 January 2017. The standard has not yet been approved by the EU.
In accordance with IFRS 16 Leases, lessees must enter lease agreement liabilities to cover future lease payments and asset items related to the right to use the object into their balance sheets under almost all lease agreements.
Biohit is currently assessing the impact of applying the new standards. Other IFRS standards or IFRIC interpretations that have already been published but have not entered into force are not expected to have a material impact on the Group.
The company's product portfolio consists of diagnostic tests, analysis systems, products binding carcinogenic acetaldehyde into a harmless compound, monoclonal antibodies and service laboratory operations. The entire product and service portfolio is reported under a single segment.
No businesses were acquired in the 2014 and 2015 financial periods.
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Continuing operations | ||
| Biohit Biotech (Hefei) Co., Ltd. *) | 660 | – |
| Grants | 14 | 239 |
| Profit from sales of property, plant and equipment | 76 | – |
| Loss from sales of property, plant and equipment | –6 | – |
| Other | 12 | 5 |
| Total | 757 | 245 |
*) Joint control of Biohit Biotech (Hefei) Co Ltd in accordance with the IFRS 10 standard took effect on 30 September 2015 in the manner referred to in the standard and the shareholders' agreement. As such, the investment is recognised in accordance with the new standards as a consolidated entity in the balance sheet of Biohit's consolidated financial statements. It is recognised via the equity method. The consolidation gave rise to a nonrecurring item in other business income in the amount of EUR 0.7 million. Biohit Oyj's share of the profit/loss of the joint venture is recognised above operating profit.
| Profit for the period, discontinued operations | – | 3,257 |
|---|---|---|
| Total | – | 3,257 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Materials, supplies and other direct expenses | 2,733 | 1,924 |
| Rents | 89 | – |
| Depreciation | 32 | – |
| Total | 2,855 | 1,924 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Employee benefit expenses | 1,107 | 987 |
| Travel and other personnel-related expenses | 158 | 148 |
| Rent and maintenance expenses | 74 | 59 |
| Marketing and sales expenses | 612 | 643 |
| Other external services | 356 | 142 |
| Other operating expenses | 20 | 30 |
| Depreciation | 14 | 49 |
| Total | 2,341 | 2,058 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Employee benefit expenses *) | 1,575 | 1,766 |
| Travel and other personnel-related expenses | 124 | 162 |
| Rent and maintenance expenses | 196 | 305 |
| Other external services | 144 | 463 |
| Other operating expenses | 204 | 292 |
| Depreciation | 161 | 75 |
| Total | 2,405 | 3,063 |
*) Includes EUR 216,000 in option-related expenses recorded for 2015 and EUR 549,000 recorded for 2014.
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Employee benefit expenses | 874 | 838 |
| Travel and other personnel-related expenses | 30 | 46 |
| Rent and maintenance expenses | 11 | 22 |
| Other external services | 530 | 562 |
| Other operating expenses | 481 | 492 |
| Depreciation | 112 | 107 |
| Total | 2,038 | 2,067 |
Information about management's employee benefits is presented in Note 30 Related party transactions
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Biohit Biotech (Hefei) Co., Ltd. *) | –70 | – |
| *) See note 5 |
| 2015 | 2014 | |
|---|---|---|
| Average number of personnel | 52 | 50 |
| Number of personnel at the end of the period | 49 | 51 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Intangible assets | 186 | 113 |
| Buildings | 11 | 11 |
| Machinery and equipment | 122 | 107 |
| Total | 319 | 231 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Auditors' fees | 52 | 67 |
| Other services * | 6 | 61 |
| Total auditors' fees | 58 | 127 |
*) Other services for 2014 includes EUR 29,000 total auditor fees paid to Authorised Public Accounting company EY
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Currency exchange gains from financial assets and liabilities | 1 | 1 |
| Net profit/loss on investments recognised at fair value through profit or loss | 112 | 42 |
| Other financial income | 125 | 207 |
| Total | 238 | 250 |
| Interest expenses on financial liabilities | –3 | –3 |
| Currency exchange losses from financial assets and liabilities | –24 | –12 |
| Fees and other remuneration | –19 | –24 |
| Other financial expenses | –195 | –20 |
| Total | –241 | –58 |
| Total financial income and expenses | –3 | 192 |
| Direct taxes | ||
|---|---|---|
| 1,000 € | 2015 | 2014 |
| Taxes on taxable income for the period | –61 | –67 |
| Taxes from previous period | 0 | –54 |
| Deferred taxes | 47 | 16 |
| Total direct taxes | –14 | –105 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Profit before taxes | –2,903 | –4,312 |
| Taxes calculated at domestic rates 20% | 581 | 862 |
| Effect of different tax rates of foreign subsidiaries | –14 | –51 |
| Tax-free income and Non-deductible expenses | –8 | 643 |
| Unrecognised deferred tax assets from tax losses | –572 | –1,558 |
| Taxes in previous financial years | – | –54 |
| Other items | – | 53 |
| Taxes in the income statement | –14 | –105 |
Undiluted earnings per share are calculated by dividing the profit for the period attributable to equity-holders of the parent company by the weighted average number of shares outstanding during the period.
| 2015 | 2014 | |
|---|---|---|
| Earnings for the period attributable to equity-holders of the parent company, EUR 1,000 | –2,917 | –4,417 |
| Result for the period for the calculation of earnings per share adjusted with the dilution | ||
| effect. | –2,917 | –4,417 |
| Average number of shares, undiluted | 14,276,519 | 13,941,286 |
| Impact of stock options | 427,060 | 580,000 |
| Average number of shares, diluted | 14,703,579 | 14,521,286 |
| Earnings per share, undiluted, EUR | –0.20 | –0.32 |
| Earnings per share discontinued operations, undiluted, EUR | – | 0.23 |
| Earnings per share discontinued operations, diluted, EUR | – | 0.22 |
The dilutive effect on continuing operations is ignored because the Group's result for the financial period is negative, and the dilutive effect would improve EPS.
| 2015 | Intellectual property |
Other intan gible |
|
|---|---|---|---|
| 1,000 € | rights | assets | Total |
| Acquisition cost 1 Jan 2015 | 2,133 | 707 | 2,841 |
| Increases | – | 0 | 0 |
| Decreases | –26 | – | –26 |
| Acquisition cost 31 Dec 2015 | 2,108 | 707 | 2,815 |
| Accumulated depreciation and impairment 1 Jan 2015 | –535 | –699 | –1,233 |
| Depreciation | –179 | –7 | –186 |
| Accumulated depreciation and impairment 31 Dec 2015 | –714 | –705 | –1,419 |
| Carrying amount 1 Jan 2015 | 1,599 | 9 | 1,607 |
| Carrying amount 31 Dec 2015 | 1,394 | 2 | 1,396 |
| 2014 | Intellectual property |
Other intan gible |
|
|---|---|---|---|
| 1,000 € | rights | assets | Total |
| Acquisition cost 1 Jan 2014 | 2,140 | 712 | 2,852 |
| Decreases | –7 | –5 | –12 |
| Acquisition cost 31 Dec 2014 | 2,133 | 707 | 2,841 |
| Accumulated depreciation and impairment 1 Jan 2014 | –433 | –687 | –1,120 |
| Depreciation | –101 | –11 | –113 |
| Accumulated depreciation and impairment 31 Dec 2014 | –535 | –699 | –1,233 |
| Carrying amount 1 Jan 2014 | 1,707 | 25 | 1,732 |
| Carrying amount 31 Dec 2014 | 1,599 | 9 | 1,607 |
Intellectual property rights consist of patents.
| 2015 | Machinery and |
||
|---|---|---|---|
| 1,000 € | Buildings | equipment | Total |
| Acquisition cost 1 Jan 2015 | 147 | 1,592 | 1,739 |
| Increases | – | 172 | 172 |
| Decreases | – | –266 | –266 |
| Acquisition cost 31 Dec 2015 | 147 | 1,498 | 1,645 |
| Accumulated depreciation and impairment 1 Jan 2015 | –121 | –761 | –882 |
| Depreciation | –11 | –122 | –133 |
| Depreciation of decreases | – | 152 | 152 |
| Accumulated depreciation and impairment 31 Dec 2015 | –132 | –731 | –863 |
| Carrying amount 1 Jan 2015 | 26 | 831 | 857 |
| Carrying amount 31 Dec 2015 | 15 | 767 | 782 |
| 2014 | Machinery | |||||
|---|---|---|---|---|---|---|
| 1,000 € | Buildings | and equipment |
Total | |||
| Acquisition cost 1 Jan 2014 | 147 | 1,123 | 1,268 | |||
| Increases | – | 469 | 469 | |||
| Acquisition cost 31 Dec 2014 | 147 | 1,592 | 1,739 | |||
| Accumulated depreciation and impairment 1 Jan 2014 | –110 | –654 | –763 | |||
| Depreciation | –11 | –107 | –118 | |||
| Accumulated depreciation and impairment 31 Dec 2014 | –121 | –761 | –882 | |||
| Carrying amount 1 Jan 2014 | 37 | 469 | 506 | |||
| Carrying amount 31 Dec 2014 | 26 | 831 | 857 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Carrying amount 1 Jan | – | – |
| Acquisition of joint venture 30 September 2015 | 660 | – |
| Share of the profit/loss of joint venture | –70 | |
| Translation difference | 6 | – |
| Carrying amount 31 Dec | 596 | – |
Information about the Group's associated companies and joint ventures, including their combined assets, liabilities, net sales and profit/loss:
| 1,000 € | Domicile | Assets | Liabilities | Net sales |
Profit (+) and loss (–) for the financial period |
Ownership stake (%) |
|---|---|---|---|---|---|---|
| 2015 | ||||||
| Biohit Biotech (Hefei) Co., Ltd |
China, Anhui, Hefei |
3,571 | 192 | 248 | –1,141 | 40% |
| 1,000 € | Loans and other receivables |
Available for-sale financial assets |
Held-to maturity investments |
Total carrying amount |
Fair value | Fair value hierarchy |
|---|---|---|---|---|---|---|
| Non-current financial assets | ||||||
| Other financial long-term assets | 2 | 2 | 2 | 2 | ||
| Total | 2 | – | – | 2 | 2 | |
| Current financial assets Trade and other receivables |
997 | 997 | 997 | |||
| Other current financial assets Cash and cash equivalents |
723 | 6,518*) | 6,518 723 |
6,518 723 |
2 | |
| Total | 1,720 | 6,518 | – | 8,238 | 8,238 | |
| Total financial assets | 1,722 | 6,518 | – | 8,240 | 8,240 |
| Available | ||||||
|---|---|---|---|---|---|---|
| Loans and | for-sale | Held-to | Total | |||
| other | financial | maturity | carrying | Fair value | ||
| 1,000 € | receivables | assets | investments | amount | Fair value | hierarchy |
| Non-current financial assets | ||||||
| Other financial long-term assets | 4 | – | – | 4 | 4 | 2 |
| Total | 4 | – | – | 4 | 4 | |
| Current financial assets | ||||||
| Trade and other receivables | 775 | – | – | 775 | 775 | |
| Other current financial assets | – | 9,811*) | – | 9,811 | 9,811 | 2 |
| Cash and cash equivalents | 608 | – | – | 608 | 608 | |
| Total | 1,383 | 9,811 | – | 11,194 | 11,194 | |
| Total financial assets | 1,387 | 9,811 | – | 11,198 | 11,198 |
*) Available-for-sale financial assets totalling EUR 6,518 thousand (EUR 9,811 thousand) include unquoted investments totalling EUR 2 thousand (EUR 7 thousand), which have been presented at acquisition cost because their fair value is not reliably available.
Fair value hierarchy. Classification in accordance with IFRS 7, which came into force on 1 January 2009.
The carrying value of other receivables is equivalent to their fair value, because the discount effect is minimal when the maturity of liabilities is taken into account.
| 1,000 € | Carrying amount 2015 |
Fair value 2015 |
Carrying amount 2014 |
Fair value 2014 |
|---|---|---|---|---|
| Other liabilities | 4 | 4 | 3 | 3 |
| Total | 4 | 4 | 3 | 3 |
| Current financial liabilities measured at amortised cost | ||||
| Other interest-bearing liabilities | 128 | 128 | 256 | 256 |
| Trade payables | 326 | 326 | 529 | 529 |
| Tax liabilities | – | – | 54 | 54 |
| Other liabilities | 785 | 785 | 789 | 789 |
| Total | 1,239 | 1,239 | 1,628 | 1,628 |
| Total financial liabilities | 1,243 | 1,243 | 1,631 | 1,631 |
The original carrying amount of trade payables and other non-interest-bearing liabilities is equivalent to their fair value, because the discount effect is minimal when the maturity of liabilities is taken into account.
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Deferred tax assets | ||
| Deferred tax assets | 70 | 26 |
| Internal margin on inventories | 6 | 4 |
| Total | 77 | 30 |
| Deferred tax liabilities | ||
| Acquisitions, customer relationships | 175 | 199 |
| Tangible assets | 1 | 2 |
| Total | 176 | 200 |
The Group has tax-deductible losses of EUR 15.5 million for 2012, 2013, 2014 and 2015 for which no deferred tax assets have been recognised.
Of the total losses, EUR 15.1 million were generated in Finland (2015: EUR 3.2 million, 2014: EUR 4.1 million, 2013: 4.4. million, 2012: 3.4 million) and EUR 0.4 million in the Italy. In Finland the losses will become void in 10 years.
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Materials and supplies | 333 | 411 |
| Work in progress | 35 | 223 |
| Completed products/goods | 269 | 182 |
| Total inventories | 637 | 816 |
| Non-current receivables | |||||
|---|---|---|---|---|---|
| 1,000 € | 2015 | 2014 | |||
| Long-term interest-bearing receivables | 79 | 34 | |||
| Total | 79 | 34 | |||
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Trade receivables | 756 | 481 |
| Prepayments and accrued income | 186 | 252 |
| Other receivables | 56 | 41 |
| Total | 997 | 775 |
A breakdown of trade receivables by age is presented in Note 29.
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Cash and cash equivalents | 723 | 608 |
| Available-for-sale financial assets | 6,518 | 9,811 |
| Total | 7,241 | 10,419 |
| Cash and cash equivalents in the cash flow statement | 723 | 608 |
Biohit Oyj's share capital is EUR 2,350,350.81 (EUR 2 350 350,81 ) and the number of shares is 14,348,533 (14,135,593), of which 2,975,500 (2,975,500) are Series A shares and 11,373,033 (11,160,093) Series B shares. The Series B shares are quoted on the stock.
The shares have no nominal value. Series A and Series B shares differ to the extent that each Series A share confers on its subscriber the right to twenty (20) votes at General Meetings and each Series B share confers the right to one (1) vote. In terms of dividends, B series shares receive dividends that are 2 (two) percentage points higher than A series shares in relation to the nominal values. In applying this provision, the share par value is considered EUR 0.17, which was the par value of the company share at the time when the company decided to abolish par value of shares.
The share capital is fully paid-in.
The translation differences fund includes translation differences resulting from the translation of foreign subsidiaries' financial statements into euros.
Invested unrestricted equity fund includes other equity investments and payments for share subscriptions insofar as it is decided not to enter said amounts in the share capital.
50
Biohit Oyj has launched a share-based incentive system, which offers stock options to company management and employees. In addition, the company offered options to two private persons as one-off compensation for the alteration of old contractual terms. In accordance with the option scheme, the options are granted without any monetary compensation, but a subscription price has been determined for the shares. The key terms and conditions of the incentive scheme, such as vesting conditions, are shown in the table below.
| Option Scheme | I 2013 Classes A, B, C, D, E |
II 2013 |
|---|---|---|
| Nature of the scheme | Stock options | Stock options |
| Grant date | 19/06/2013 | 19/06/2013 |
| Number of instruments granted | 500,000 | 420,000 |
| Subscription price | EUR 3.00 | EUR 3.00 |
| Share price on grant date | EUR 5.36–7.35 | EUR 5.36 |
| Validity (in years | 6 | 2 |
| Implementation | In shares | In shares |
The stock options will lapse if they are not exercised in the specified time frame. In Option Scheme I 2013, the employee entitled to the incentive will lose the entitlement if the employee leaves the company prior to vesting. In Option Scheme II 2013, the incentives have been earned in full prior to 31 December 2013
| Number of options | 2015 | 2014 |
|---|---|---|
| At the beginning of period | 580,000 | 905,000 |
| New options granted | 60,000 | – |
| Lost options | – | – |
| Exercised options | 212,940 | 325,000 |
| Lapsed options | – | – |
| At the end of period | 427,060 | 580,000 |
| Exercisable options at the end of the period | 207,060 | 360,000 |
| Exercise price as a weighted average per share, EUR | 2.28 | 2.28 |
Dividends paid in accordance with the terms of the option scheme affect the exercise price. No dividend was paid for the financial period that ended on 31 December 2014, so the exercise price did not change.
The weighted average closing price of the parent company share in 2015 was EUR 5.49 (EUR 6.35 in 2014). Options were exercised in the first, second and third quarter. The proceeds from share subscriptions were recognised in share capital and in invested non-restricted equity fund.
The exercise price range for options outstanding at the end of the period and the weighted average of the remaining validity are shown below.
| Exercise price range change (EUR) |
Weighted average of the validity period (years) |
Number of stock options |
|
|---|---|---|---|
| 2015 | 0.0 | 4.4 | 207,060 |
| 2014 | 0.0 | 2.4 | 580,000 |
The Group uses the Black-Scholes model to determine fair value for the option scheme. The expected volatility is determined on the basis of the historical price performance of the parent company share, taking into account the remaining validity of the options. The fair value of shares in the option schemes is based on the quoted share price.
| Option Scheme | I 2013 | II 2013 |
|---|---|---|
| Expected volatility | 45%–88% | 70% |
| Expected average of option validity on grant date (years) | 6 | 2 |
| Risk-free interest % | 0.40%–1.12% | 0.39% |
| deducted from subscription |
deducted from subscription |
|
| Expected dividends (dividend income) | value | value |
| Fair value of the instrument on grant date (EUR) | 5.36–7.35 | 5.36 |
The amount recognised as expenses is included in note 8 ("Administrative expenses").
| Interest-bearing liabilities, balance sheet values | ||
|---|---|---|
| 1,000 € | 2015 | 2014 |
| Long-term interest-bearing liabilities | ||
| The company has no long-term interest-bearing liabilities | ||
| Current interest-bearing debt | ||
| Loans from financial institutions, current portion | 128 | 256 |
| Total | 128 | 256 |
| Total interest-bearing liabilities | 128 | 256 |
Fair values for financial liabilities are presented in Note 20.
The company has no non-current loans.
The company has no subordinated loans.
The company has no finance lease liabilities.
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Deferred tax liabilities | 176 | 200 |
| Other non-current liabilities | 4 | 3 |
| Total | 180 | 203 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Trade payables | 326 | 529 |
| Tax liabilities | – | 54 |
| Accrued liabilities and prepaid income | 785 | 789 |
| Total | 1,111 | 1,372 |
| Total non-interest-bearing liabilities | 1,290 | 1,575 |
The main item in accrued liabilities and prepaid income is amortised employee benefit.
Biohit's financial risk management has focused on analysing and minimising the following major risks:
International business operations involve exchange rate risks. In comparable currencies, the net sales of Biohit do not significantly differ from the reported values. The overall impact of the exchange rates on the company's profitability during the financial year was not significant. The company primarily conducts its sales in euros, and it has made no currency hedging arrangements.
| 2015 | ||
|---|---|---|
| 1,000 € | USD | GBP |
| Non-current liabilities | – | – |
| Open position | – | – |
| Current assets | ||
| Trade and other receivables | – | 321 |
| Current liabilities | ||
| Non-interest-bearing liabilities | –4 | –96 |
| Open position | –4 | 225 |
| Net position | –4 | 225 |
| 1,000 € | USD | GBP |
|---|---|---|
| Non-current liabilities | – | – |
| Open position | – | – |
| Current assets | ||
| Trade and other receivables | 11 | 39 |
| Current liabilities | ||
| Non-interest-bearing liabilities | –73 | – |
| Open position | –62 | 39 |
| Net position | –62 | 39 |
The net position includes cash and cash equivalents in foreign currencies, as well as receivables and payables to both Group and non-Group companies, converted into euros at the exchange rate for the closing date.
Changes in interest rates have only a slight effect on Biohit's earnings, for which reason the Group has not implemented separate hedging measures during the financial period.
The objective of the liquidity risk management is to ensure group financing in all circumstances. The Group's liquid assets on the closing day were EUR 7.2 million (EUR 10.4 million). When investing liquid assets, the objective is to gain a return on investment with a minimum risk of equity loss. The investment portfolio consists of yield investments, money market investments and corporate loans. Sufficient diversification between different asset classes, investment instruments and counterparties is essential. Biohit conducts its investment activities with at least two partners.
The Group's equity ratio was 87.9% (87.5%)
| 1,000 € | ‹ 1 year | 1–5 years | › 5 years | Total |
|---|---|---|---|---|
| Trade payables and other non-interest-bearing liabilities | 326 | – | – | 326 |
| Repayments on loans from financial institutions | 128 | – | – | 128 |
| Interest expenses on loans from financial institutions | 2 | – | – | 2 |
| Total | 456 | – | – | 456 |
| Financial liability maturity analysis 2014 1,000 € |
‹ 1 year | 1–5 years | › 5 years | Total |
| Trade payables and other non-interest-bearing liabilities | 529 | – | – | 529 |
| Repayments on loans from financial institutions | 256 | – | – | 256 |
| Interest expenses on loans from financial institutions | 2 | – | – | 2 |
| Total | 787 | – | – | 787 |
The company does not use derivatives to protect the commodity risk, because due the nature of its business, the company is not vulnerable to commodity risks.
Business units are responsible for any credit loss risks associated with their trade receivables, and have conducted separate evaluations of the credit risk associated with each customer. Biohit's customer base consists mainly of financially sound companies, and consequently Biohit does not consider credit loss risks significant. The Group has not taken out any credit insurance. Biohit mainly enters into long-term, active relationships with its customers, so that any changes in customers' credit ratings will quickly come to the company's attention.
On 31 December 2015, trade receivables totalled EUR 0.8 million (EUR 0.5 million). The receivables do not contain any large outstanding balancespayable by individual customers. The maximum credit risk exposure is the carrying value of accounts receivable.
| Impairment | Net | Impairment | Net | |||
|---|---|---|---|---|---|---|
| 1,000 € | 2015 | loss | 2015 | 2014 | loss | 2014 |
| Not yet falling due | 426 | 426 | 315 | 315 | ||
| Under 60 days due | 222 | 222 | 118 | 118 | ||
| 61–120 days due | 81 | 81 | 23 | 23 | ||
| 121–360 days due | 28 | –1 | 27 | 31 | –5 | 26 |
| Over 360 days due | 4 | –4 | 0 | – | – | – |
| Total | 761 | –5 | 756 | 486 | –5 | 481 |
In 2015, EUR 3,000 worth of credit losses were recorded. In 2014, EUR 3,000 worth of credit losses were recorded, but at the same time previously recorded credit losses in the amount of EUR 16,000 were reversed.
The equity ratio – an indicator of the company's capital structure – is calculated by dividing the Group's equity by the balance sheet total less advances received. The result of this calculation is then multiplied by one hundred.
Equity ratio
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Total shareholders' equity | 10,310 | 12,677 |
| Balance sheet total | 11,728 | 14,508 |
| Advances received | 0 | –4 |
| Equity ratio | 87.9% | 87.5% |
Parties are considered to be related parties if one party is able to exercise control over the other or has substantial influence in decision-making related to the other's finances and business operations. The Group's related parties include members of the Board of Directors, the Group Management Team, and the President & CEO.
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Parent company | ||
| Management Teams | 492 | 533 |
| President & CEO | 191 | 176 |
| Members of the Scientific Advisory Board | 221 | 220 |
Based on a decision by the Board of Directors, Osmo Suovaniemi has been employed by the company as a member of the Scientific Advisory Board. He has received a total of EUR 221 thousand (EUR 220 thousand). In addition, Franco Aiolfi has received other compensation of EUR 36 thousand (EUR 18 thousand)
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Subsidiaries | ||
| Managing directors | 126 | 101 |
| Fees paid to Board members | ||
| 1,000 € | 2015 | 2014 |
| Parent company | ||
| Osmo Suovaniemi | 16 | 16 |
| Franco Aiolfi | 15 | 15 |
| Eero Lehti | 15 | 12 |
| Seppo Luode | 15 | 15 |
| Mikko Salaspuro | 15 | 15 |
| Janina Andersson | 12 | – |
| Parent company, total | 88 | 73 |
| Share-based payments | ||
| 1,000 € | 2015 | 2014 |
| Parent company | ||
| Management Teams | 20 | 216 |
| President & CEO | 155 | 268 |
| Key sales persons | 41 | 64 |
On 31 December 2015, Board members and the President and CEO owned a total of 2,376,950 Series A shares and 3,520,906 Series B shares. These shares represent 41.1% of all company shares and 72.0% of all the votes to which the shares entitle. Osmo Suovaniemi, Chairman of the Board, is a majority shareholder in Interlab Oy, which owns 2,164,497 Series B shares. Board member Franco Aiolfi is a majority shareholder in Euroclone S.p.A. through Arsfin Consult S.r.l. Euroclone S.p.A. owns 172,807 Series B shares.
At the end of 2015, the Group's President & CEO held 127,060 options (160,000). Members of the Group Management Team held 60,000 options (0) at the end of 2015. Each option entitles its holder to subscribe to one series B share, which accounts for 1.3% of all shares and 0.26% of all votes. The options held by the Group's President & CEO and members of the Group Management Team are subject to the same terms and conditions as the options held by others. Option bonuses granted to the company's managers are measured at fair value at the time of issue and recognised evenly as cost items throughout the period during which they were earned, which runs from 19 June 2013 to 31 May 2019.
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Consulting, administrative and logistics fees | ||
| Companies controlled by Board members | 244 | 223 |
| Total | 244 | 223 |
| Parent company Biohit Oyj, Finland | Group's holding |
|---|---|
| Biohit Healthcare Ltd, UK | 100% |
| Biohit Healthcare S.r.l., Italy | 100% |
| Oy Finio Ab, Finland | 100% |
| Vantaan Hienomekano Oy, Finland | 100% |
Oy Finio Ab and Vantaan Hienomekano Oy did not conduct any business operations in 2014 or 2015.
| Biohit Healthcare (Hefei) Co. Ltd *) | 40% |
|---|---|
*) See note 5.
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Collateral granted on behalf of the parent company | ||
| Guarantees | 3 | 3 |
| Other liabilities | ||
| Leasing commitments: | ||
| Due for payment in one year | 50 | 83 |
| Due for payment in more than one year but less than five years | 36 | 108 |
| Total | 85 | 191 |
| Other rental commitments: | ||
| Due for payment in one year | 208 | 183 |
| Due for payment in more than one year but less than five years | 647 | 684 |
| Due for payment in more than 5 years | – | 84 |
| Total | 855 | 951 |
| Total other liabilities | 941 | 1,142 |
| Total collaterals and contingent liabilities | 944 | 1,145 |
Biohit Oyj and Genetic Analysis AS signed a share exchange agreement through which Biohit Oyj acquired ownership of 18% of shares in the company. In addition to this the companies signed a distribution agreement giving Biohit Oyj a right to sell Genetic Analysis AS's Dysbiosis Test globally under the Biohit brand and exclusively in Finland and in China. In the future, Genetic Analysis will also operate as a distributor to Biohit Oyj's products and services in Norway.
In consideration, Biohit Oyj issued 350.000 pcs of new Biohit Oyj's series B shares to Genetic Analysis AS. The new class B shares were registered with the Trade Register on February 12, 2016, and the shares carry with them the same shareholder rights as the outstanding class B shares as of the date of the registration. The trading in the new shares commenced as of February 15, 2016 on NASDAQ OMX Helsinki together with the outstanding B shares. The arrangements related to the share exchange have been completed and the new Genetic Analysis AS shares have been registered in Biohit Oyj's name.
| IFRS | IFRS | IFRS | IFRS | IFRS | |
|---|---|---|---|---|---|
| 1,000 € | 2011 | 2012 | 2013 | 2014 | 2015 |
| Net sales | 39,922 | 2,048 | 3,452 | 4,363 | 6,051 |
| Change in net sales, % | –0.3% | –94.9% | 68.6% | 26.4% | 38.7% |
| Operating profit/loss | 44,262 | –4,586 | –5,860 | –4,504 | –2,900 |
| % of net sales | 110.9% | –223.9% | –169.8% | –103.2% | –47.9% |
| Profit/loss before extraordinary items and taxes | 43,789 | –3,659 | –5,921 | –4,312 | –2,903 |
| % of net sales | 109.7% | –178.7% | –171.5% | –98.8% | –48.0% |
| Profit/loss before taxes | 43,789 | –3,659 | –5,921 | –4,312 | –2,903 |
| % of net sales | 109.7% | –178.7% | –171.5% | –98.8% | –48.0% |
| Return on equity, % | 114.5% | –8.3% | –20.4% | –24.5% | –25.3% |
| Return on investment, ROI, % | 69.8% | –7.1% | –19.4% | –23.8% | –22.8% |
| Equity ratio | 74.0% | 88.7% | 82.2% | 87.5% | 87.9% |
| Investments in fixed assets | 4,069 | 281 | 1,827 | 447 | 832 |
| % of net sales | 10.2% | 13.7% | 52.9% | 10.2% | 13.8% |
| R&D expenditure | 2,213 | 970 | 1,063 | 2,067 | 2,038 |
| % of net sales | 5.5% | 47.4% | 30.8% | 47.4% | 33.7% |
| Balance sheet total | 71,472 | 40,007 | 27,306 | 14,508 | 11,728 |
| Personnel, continuing operations | 36 | 35 | 44 | 50 | 52 |
| Average number of personnel | 422 | 35 | 44 | 50 | 52 |
| IFRS | IFRS | IFRS | IFRS | IFRS | |
|---|---|---|---|---|---|
| 2011 | 2012 | 2013 | 2014 | 2015 | |
| Earnings per share, undiluted, EUR | 2.86 | –0.27 | –0.43 | –0.32 | –0.20 |
| Equity per share attributable to the equity holders of the parent company, EUR |
3.88 | 2.61 | 1.63 | 0.90 | 0.72 |
| Price/earnings ratio, (P/E) | 1.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| Dividend per share | 0.20 | 0.50 | 0.72 | ||
| Capital repayment per share | 0.80 | 0.24 | 0.00 | ||
| Dividend per earnings, % | 34.97 | n/a | n/a | ||
| Effective dividend yield, % | 34.13 | 18.42 | 9.57 | 0.00 | 0.00 |
| B share price development, EUR | |||||
| – average price | 2.30 | 2.70 | 6.59 | 6.35 | 5.45 |
| – lowest price | 1.74 | 2.00 | 4.00 | 4.57 | 4.22 |
| – highest price | 3.96 | 4.13 | 9.10 | 8.17 | 7.14 |
| –price at 31 December | 2.93 | 4.00 | 7.56 | 4.68 | 5.61 |
| Market capitalisation, EUR 1,000 (assuming the market capitalisation value for series A shares is the |
|||||
| same as for series B shares | 39,894 | 54,462 | 104,408 | 66,155 | 80,495 |
| Turnover of Series B shares, 1,000 shares | 3,003 | 5,376 | 8,593 | 4,029 | 4,014 |
| –% of total number of shares | 30.1% | 50.5% | 79.3% | 37.2% | 37.0% |
| Average number of shares, adjusted for share issues | 13,615,593 | 13,727,251 | 13,941,286 | 13,941,286 | 14,276,519 |
| –accounting for the dilutive effect of options and bonds |
13,615,593 | 13,915,143 | 14,521,286 | 14,521,286 | 14,703,579 |
| Total number of shares at the closing date, adjusted for share issues |
13,615,593 | 13,810,593 | 14,135,593 | 14,135,593 | 14,348,533 |
| –accounting for the dilutive effect of options and bonds |
13,615,593 | 14,223,768 | 14,715,593 | 14,715,593 | 14,775,593 |
The company has options with a dilutive effect. Since the company recorded a loss, the dilutive effect is not presented.
| Number of shareholders |
Number of shares |
|||
|---|---|---|---|---|
| Series A shares | pcs | % | pcs | % |
| 1. Companies | 1 | 10.0 | 24,990 | 0.8 |
| 2. Households | 9 | 90.0 | 2,950,510 | 99.2 |
| Shares on waiting list | 0 | 0.0 | ||
| Total Series A shares | 10 | 100.0 | 2,975,500 | 100.0 |
| Number of shareholders |
Number of shares |
|||
|---|---|---|---|---|
| Series B shares | pcs | % | pcs | % |
| 1. Households | 6,360 | 96.6 | 8,238,874 | 72.4 |
| 2. Financial and insurance institutions | 10 | 0.2 | 10,170 | 0.1 |
| 3.Companies and housing corporations | 187 | 2.8 | 2,854,110 | 25.1 |
| 4.Non-profit organisations | 7 | 0.1 | 3,681 | 0.0 |
| 5. Public sector organisations | 1 | 0.0 | 3,000 | 0.0 |
| 6.Nominee-registered and foreign holders | 19 | 0.3 | 257,606 | 2.3 |
| In joint account | 0 | 0.0 | 5,592 | 0.0 |
| Total Series B shares | 6,584 | 100.0 | 11,373,033 | 100.0 |
| Total Series A and B shares | 6,594 | 14,348,533 |
| Number of shareholders |
Number of shares |
||||
|---|---|---|---|---|---|
| Series A shares | pcs | % | pcs | % | |
| 1–1,000 | 0 | 0,0 | 0 | 0,0 | |
| 1,001–10,000 | 3 | 30,0 | 25 000 | 0,8 | |
| 10,001–100,000 | 3 | 30,0 | 156 990 | 5,3 | |
| Over 100,001 | 4 | 40,0 | 2 793 510 | 93,9 | |
| Total Series A shares | 10 | 100,0 | 2 975 500 | 100,0 |
| Number of shareholders |
Number of shares |
|||
|---|---|---|---|---|
| Series B shares | pcs | % | pcs | % |
| 1–1,000 | 5,630 | 85.5 | 1,646,983 | 14.5 |
| 1,001–10,000 | 861 | 13.1 | 2,497,662 | 22.0 |
| 10,001–100,000 | 88 | 1.3 | 2,102,819 | 18.5 |
| Over 100,001 | 5 | 0.1 | 5,119,977 | 45.0 |
| Shares on joint book-entry account | 0 | – | 5,592 | 0.0 |
| Total Series B shares | 6,584 | 100.0 | 11,373,033 | 100.0 |
| Total Series A and B shares | 6,594 | 14,348,533 |
| The 10 largest shareholders | ||||
|---|---|---|---|---|
| by number of shares | Series A shares | Series B shares | Total votes | % |
| Suovaniemi Osmo Antero | 2,265,350 | 965,217 | 3,230,567 | 22.5 |
| Interlab Oy | 0 | 2,164,497 | 2,164,497 | 15.1 |
| Suovaniemi Ville Roi | 208,280 | 371,300 | 579,580 | 4.0 |
| Joel Suovaniemi | 208,280 | 334,500 | 542,780 | 3.8 |
| Suovaniemi Oili | 111,600 | 288,935 | 400,535 | 2.8 |
| Härkönen Matti | 57,200 | 267,965 | 325,165 | 2.3 |
| Suovaniemi Vesa Jukka Markku | 74,800 | 187,819 | 262,619 | 1.8 |
| Oy Etra Invest Ab | 0 | 200,000 | 200,000 | 1.4 |
| Oy Tech Know Ltd | 24,990 | 70,000 | 94,990 | 0.7 |
| Luostarinen Reijo | 10,000 | 70,000 | 80,000 | 0.6 |
| The 10 largest shareholders | ||||
|---|---|---|---|---|
| -- | -- | -- | -- | ----------------------------- |
| by number of votes | Series A shares | Series B shares | Total votes | % |
|---|---|---|---|---|
| Suovaniemi Osmo Antero | 2,265,350 | 965,217 | 46,272,217 | 65.3 |
| Suovaniemi Ville Roi | 208,280 | 371,300 | 4,536,900 | 6.4 |
| Joel Suovaniemi | 208,280 | 334,500 | 4,500,100 | 6.4 |
| Suovaniemi Oili | 111,600 | 288,935 | 2,520,935 | 3.6 |
| Interlab Oy | 0 | 2,164,497 | 2,164,497 | 3.1 |
| Suovaniemi Vesa Jukka Markku | 74,800 | 187,819 | 1,683,819 | 2.4 |
| Härkönen Matti | 57,200 | 267,965 | 1,411,965 | 2.0 |
| Oy Tech Know Ltd | 24,990 | 70,000 | 569,800 | 0.8 |
| Luostarinen Reijo | 10,000 | 70,000 | 270,000 | 0.4 |
| Oy Etra Invest Ab | 0 | 200,000 | 200,000 | 0.3 |
On 31 December 2015 Board members and the President and CEO owned a total of 2,376,950 Series A shares and 3,520,906 Series B shares. These shares represent 41.1% of all company shares and 72.0% of all the votes to which the shares entitle. Osmo Suovaniemi, Chairman of the Board, is a majority shareholder in Interlab Oy, which owns 2,164,497 Series B shares. Board member Franco Aiolfi is a majority shareholder in Euroclone S.p.A. through Arsfin Consult S.r.l. Euroclone S.p.A. owns 172,807 Series B shares.
| Return on equity, % | result for the period shareholders' equity (average over the year) |
X100 |
|---|---|---|
| Return on investment, % | profit before extraordinary items + interest and other financial expenses Total assets – non-interest-bearing liabilities (average over the year) |
X100 |
| Equity ratio, % | shareholders' equity in the balance sheet balance sheet total – advance payments received |
X100 |
| Earnings per share, EUR | result for the period average number of shares, adjusted for share issues |
|
| Shareholders' equity per share, EUR | shareholders' equity in the balance sheet number of shares on the closing date |
|
| Dividends per share, EUR | Dividends for the period number of shares on the closing date |
|
| Dividend per earnings, % | dividend per share Earnings per share |
X100 |
| Effective dividend yield, % | dividend per share closing share price |
X100 |
| Price/earnings ratio, (P/E) | closing share price earnings per share |
| 1,000 € | Note | 1 Jan–31 Dec 2015 | 1 Jan–31 Dec 2014 |
|---|---|---|---|
| Net sales | 2 | 4,047 | 2,670 |
| Increase/decrease in inventories of finished goods and in work in progress |
–124 | 54 | |
| Other operating income | 3 | 422 | 3,580 |
| Materials and services | 4 | –1,347 | –1,226 |
| Personnel expenses | 5 | –3,106 | –2,855 |
| Depreciation, amortisation and impairment | 6 | –184 | –172 |
| Other operating expenses | 7 | –2,957 | –2,839 |
| Operating profit/loss | –3,249 | –788 | |
| Financial income and expenses | 9 | –278 | 238 |
| Profit/loss before appropriations and taxes | –3,527 | –551 | |
| Income taxes | 0 | 0 | |
| Profit/loss for the period | –3,527 | –551 |
| 1,000 € | Note | 31 Dec 2015 | 31 Dec 2014 |
|---|---|---|---|
| ASSETS | |||
| Non-current assets | |||
| Intangible assets | 10 | 360 | 438 |
| Tangible assets | 11 | 724 | 779 |
| Investments | |||
| Investments Participations in Group companies | 12 | 232 | 234 |
| Other investments | 12 | 1 | 7 |
| Total non-current assets | 1,317 | 1,458 | |
| Current assets | |||
| Inventories | 13 | 562 | 759 |
| Non-current receivables | 14 | – | 330 |
| Current receivables | 14 | 1,151 | 860 |
| Marketable securities | 15 | 6,507 | 9,791 |
| Cash at bank and in hand | 16 | 186 | 183 |
| Total current assets | 8,406 | 11,923 | |
| TOTAL ASSETS | 9,723 | 13,380 | |
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||
| Shareholders' equity | |||
| Share capital | 17 | 2,350 | 2,350 |
| Fair value hierarchy | 17 | 36 | 194 |
| Fund for the investment of non-restricted equity | 17 | 1,271 | 786 |
| Accumulated profit/loss from previous years | 17 | 8,336 | 8,886 |
| Profit/loss for the period | 17 | –3,527 | –551 |
| Total shareholders' equity | 8,466 | 11,666 | |
| Liabilities | |||
| Non-current liabilities | 19 | 301 | 301 |
| Current liabilities | 20 | 956 | 1,413 |
| Total liabilities | 1,256 | 1,714 | |
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 9,723 | 13,380 |
| 1,000 € Note |
2015 | 2014 |
|---|---|---|
| Cash flow from operating activities: | ||
| Profit/loss before extraordinary items | –3,527 | –551 |
| Adjustments: | ||
| Depreciation according to plan | 184 | 172 |
| Unrealised exchange rate gains and losses | 3 | –2 |
| Other income and expenses not involving payment | 357 | –3,272 |
| Financial income and expenses | –34 | –238 |
| Change in working capital: | ||
| Increase (–) or decrease (+) in current non-interest-bearing trade receivables |
–227 | 120 |
| Increase (–) or decrease (+) in inventories | 196 | –174 |
| Increase (+) or decrease (–) in current non-interest-bearing liabilities | –272 | 319 |
| Realised exchange rate gains and losses | –16 | –13 |
| Interest and other financial items paid on other operating financial | ||
| expenses | –212 | –37 |
| Interest received from operating activities | 250 | 224 |
| Cash flow from operating activities | –3,298 | –3,451 |
| Cash flow from investing activities: | ||
| Investments in tangible and intangible assets | –237 | –397 |
| Revenue from disposal of tangible and intangible assets | 80 | – |
| Investments in other investments | 3,126 | 6,504 |
| Capital gain from the sale of liquid handling business | – | 6,814 |
| Subsidiary shares acquired | – | – |
| Loans granted | –25 | –90 |
| Repayments of loan receivables | – | – |
| Cash flow from investing activities | 2,944 | 12,831 |
| Cash flow from financing activities: | ||
| Rights issue | 485 | 751 |
| Repayments of long-term loans | –128 | –128 |
| Dividend paid and capital repayment | – | –9,991 |
| Cash flow from financing activities | 357 | –9,369 |
| Increase (+) or decrease (–) in cash and cash equivalents | 3 | 11 |
| Cash and cash equivalents at the beginning of the period | 183 | 172 |
| Cash and cash equivalents at the end of the financial period 16 |
186 | 183 |
When preparing financial statements in accordance with generally accepted accounting principles, the company's management must make estimates and assumptions. Actual results may differ from these estimates.
The parent company's financial statements have been prepared in accordance with the Finnish Accounting Act.
The financial statements are presented in thousands of euros and are based on initial transaction values, except for the marketable securities included in current assets, which have been measured at fair value
Fixed assets are recorded in the balance sheet at historical cost, exclusive of grants received and depreciation. Depreciation is calculated on a straight-line basis over the service life of the assets.
| Depreciation periods (years) according to plan are: | |
|---|---|
| Intellectual property rights | 3–10 years |
| Development expenditure | 5 years |
| Other capitalised expenditure | 5–10 years |
| Machinery and equipment | 3–10 years |
Inventories are presented according to the FIFO principle at acquisition cost, or at the lower of the replacement cost and the probable sale price. Acquisition cost of inventories includes an appropriate proportion of production overheads in addition to the direct costs.
Marketable securities included in current assets are measured at fair value in accordance with section 5.2a of the Finnish Accounting Act. The items in this group are measured at fair value. The fair value of all investments in this group is measured on the basis of released price quotations on well-functioning markets, that is, buy quotations on the closing date. Both gains and losses due to changes
in fair value are recorded under fair value fund in the balance sheet and under financial income and expenses in the income statement in the period in which they materialised.
Research and development expenditure are recorded as expenses at the point when they occurred.
Net sales are calculated as gross sales less indirect sales taxes and discounts. Revenues from products and services are recognised upon delivery.
Costs for maintenance and repairs are recorded as expenses when incurred. The renovation costs of leased premises have been capitalised under 'Other capitalised expenditure' and amortised on a straight-line basis over the remaining lease period.
Pension schemes and any additional pension benefits required by Finnish law are arranged through pension insurance companies. Pension costs are charged to the income statement for the period in which they are earned.
Deferred taxes have not been recognised in the balance sheet. In accordance with the general guidelines of the Finnish Accounting Standards Board, issued on 12 September 2006, the notes to the financial statements present the amount of deferred taxes that could be recognised in the balance sheet and assets that are unlikely to materialise and as such should not be recognised in the balance sheet.
Figures for receivables and liabilities in foreign currencies are converted into euros at the exchange rate quoted by the European Central Bank on the balance sheet date. Translation differences are recognised through profit or loss.
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Diagnostics | 4,047 | 2,670 |
| Total | 4,047 | 2,670 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Finland | 709 | 256 |
| Other Europe | 952 | 781 |
| North and South America | 118 | 94 |
| Asia | 1,496 | 1,002 |
| Other countries | 772 | 537 |
| Total | 4,047 | 2,670 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| From Group companies | 329 | 79 |
| Other | 93 | 3,501 |
| Total | 422 | 3,580 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Purchases during the year | 1,274 | 1,347 |
| Change in inventories | 73 | –120 |
| Total materials and supplies | 1,347 | 1,226 |
| Total materials and services | 1,347 | 1,226 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Salaries and wages | 2,625 | 2 429 |
| Pension expenses | 405 | 358 |
| Other personnel expenses | 76 | 68 |
| Total personnel expenses | 3,106 | 2,855 |
| Average number of employees in the parent company during the year | 2015 | 2014 |
|---|---|---|
| Salaried employees | 44 | 41 |
| Average number of personnel | 44 | 41 |
| Number of personnel at the end of the period | 40 | 42 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Intangible assets | 77 | 88 |
| Machinery and equipment | 107 | 84 |
| Total | 184 | 172 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Travel and other personnel-related expenses | 248 | 273 |
| Rent and maintenance expenses | 297 | 311 |
| Marketing and sales expenses | 577 | 475 |
| Other external services | 1,000 | 919 |
| Impairment of trade receivables | 2 | –14 |
| Other operating expenses | 833 | 875 |
| Total | 2,957 | 2,839 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Auditors' fees | 32 | 58 |
| Other fees *) | 6 | 61 |
| Total auditors' fees | 38 | 119 |
*) Other services for 2014 includes EUR 29 thousand total auditor fees paid to Authorised Public Accounting company EY
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Dividend income | ||
| From Group companies | – | 12 |
| Total dividend income | – | 12 |
| Other interest and financial income | ||
| From Group companies | 12 | 22 |
| From others | 238 | 249 |
| Other interest and financial income | 249 | 271 |
| Total financial income | 249 | 283 |
| Interest and other financial expenses | ||
| Merger loss | –312 | – |
| To Group companies | –4 | –5 |
| To others | –212 | –41 |
| Total financial expenses | –528 | –45 |
| Total financial income and expenses | –278 | 238 |
| Financial income and expenses include exchange gains/losses (net) | 1 | 1 |
The items presented as components of operating profit include exchange rate losses/gains (net) of EUR –20 thousand (EUR –12 thousand).
| 2015 | Intellectual | Other | |
|---|---|---|---|
| 1,000 € | property rights |
capitalised expenditure |
Total |
| Acquisition cost at beginning of year | 889 | 849 | 1,739 |
| Acquisition cost at end of year | 889 | 849 | 1,739 |
| Accumulated depreciation and impairment at beginning of year | –483 | –817 | –1,301 |
| Depreciation and impairment during the year | –61 | –17 | –77 |
| Accumulated depreciation at end of year | –544 | –834 | –1,378 |
| Carrying amount at beginning of year | 406 | 32 | 438 |
| Carrying amount at end of year | 345 | 15 | 360 |
| 2014 | Intellectual | Other | |
|---|---|---|---|
| 1,000 € | property rights |
capitalised expenditure |
Total |
| Acquisition cost at beginning of year | 889 | 849 | 1 739 |
| Acquisition cost at end of year | 889 | 849 | 1 739 |
| Accumulated depreciation and impairment at beginning of year | –420 | –792 | –1 213 |
| Depreciation and impairment during the year | –63 | –25 | –88 |
| Accumulated depreciation at end of year | –483 | –817 | –1,301 |
| Carrying amount at beginning of year | 469 | 57 | 526 |
| Carrying amount at end of year | 406 | 32 | 438 |
| 2015 | Machinery and equip |
|
|---|---|---|
| 1,000 € | ment | Total |
| Acquisition cost at beginning of year | 1,459 | 1,459 |
| Increases | 171 | 171 |
| Decreases | –261 | –261 |
| Acquisition cost at end of year | 1,368 | 1,368 |
| Accumulated depreciation and impairment at beginning of year | –680 | –680 |
| Accumulated depreciation of decreases | 142 | 142 |
| Depreciation for the year | –107 | –107 |
| Accumulated depreciation at end of year | –644 | –644 |
| Carrying amount at beginning of year | 779 | 779 |
| Carrying amount at end of year | 724 | 724 |
| 2014 | Machinery | |
|---|---|---|
| 1,000 € | and equp ment |
Total |
| Acquisition cost at beginning of year | 1,014 | 1,014 |
| Increases | 444 | 444 |
| Acquisition cost at end of year | 1,459 | 1,459 |
| Accumulated depreciation and impairment at beginning of year | –596 | –596 |
| Depreciation for the year | –84 | –84 |
| Accumulated depreciation at end of year | –680 | –680 |
| Carrying amount at beginning of year | 419 | 419 |
| Carrying amount at end of year | 779 | 779 |
| Group com | |||
|---|---|---|---|
| 1,000 € | panies | Other | Total |
| Shares 2015 | |||
| Carrying amount at beginning of year | 234 | 7 | 241 |
| Decreases | –3 | –6 | –8 |
| Carrying amount at end of year | 232 | 1 | 232 |
| 1,000 € | Group com panies |
Other | Total |
|---|---|---|---|
| Shares 2014 | |||
| Carrying amount at beginning of year | 234 | 7 | 241 |
| Carrying amount at end of year | 234 | 7 | 241 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Materials and supplies | 333 | 411 |
| Work in progress | 35 | 223 |
| Completed products/goods | 195 | 125 |
| Total inventories | 562 | 759 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Non-current receivables | ||
| Receivables from Group companies | ||
| Loan receivables | – | 330 |
| Total non-current receivables | – | 330 |
| Current receivables | ||
| Receivables from Group companies | ||
| Subordinated loan receivables | – | 320 |
| Trade receivables | 341 | 163 |
| Loan receivables | 355 | – |
| Other receivables | 45 | 40 |
| Prepayments and accrued income | 9 | 23 |
| Receivables from others | ||
| Trade receivables | 204 | 65 |
| Other receivables | 98 | 158 |
| Prepayments and accrued income | 100 | 91 |
| Total current receivables | 1,151 | 860 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Investments in funds | 6,507 | 9,791 |
Marketable securities include yield investments, corporate loans and money market investments.
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Cash at bank and in hand | 186 | 183 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Share capital at 1 Jan | 2,350 | 2,348 |
| Increase in share capital through rights issue | – | 3 |
| Share capital at 31 Dec | 2,350 | 2,350 |
| Invested non-restricted equity fund at 1 Jan | 786 | 44 |
| Increase in share capital | 485 | 748 |
| Capital repayment to shareholders | – | –6 |
| Invested non-restricted equity fund at 31 Dec | 1,271 | 786 |
| Fair value fund at 1 Jan | 194 | 113 |
| Increases | – | 81 |
| Decreases | –158 | – |
| Fair value fund at 31 Dec | 36 | 194 |
| Accumulated profit/loss from previous years 1 Jan | 8,336 | 18,881 |
| Dividend paid to shareholders | –9,995 | |
| Accumulated profit/loss from previous years 31 Dec | 8,336 | 8,886 |
| Reported profit / loss for the year | –3,527 | –551 |
| Total equity | 8,466 | 11,666 |
Biohit's shares are divided into Series A and B shares. The series differ to the extent that each Series A share confers twenty (20) votes at General Meetings and Series B shares confer one (1) vote. However, in the payment of dividends, a dividend two per cent higher than the nominal value is paid for Series B shares than is paid for Series A shares.In applying this provision, the share par value is considered EUR 0.17, which was the par value of the company share at the time when the company decided to abolish par value.
| Distributable unrestricted equity | 2015 | 2014 |
|---|---|---|
| Retained earnings | 8,336 | 8,886 |
| Invested unrestricted equity fund | 1,271 | 797 |
| Profit/loss for the financial period | –3,527 | –551 |
| Distributable assets 31 Dec | 6,080 | 9,133 |
| 2015 | 2014 | |||
|---|---|---|---|---|
| Structure of the parent company's shareholders' equity | No. of shares |
% of shares |
% of votes |
No. of shares |
| Series A shares (20 votes/share) | 2,975,500 | 20.7 | 84.0 | 2,975,500 |
| Series B shares (1 vote/share | 11,373,033 | 79.3 | 16.0 | 11,160,093 |
| Total | 14,348,533 | 100.0 | 100.0 | 14,135,593 |
Biohit's share capital totals EUR 2,350,350.81. The company does not own any treasury shares. Based on a resolution of the AGM held on 14 April 2014, the Board of the company is authorised to decide on the issue of shares and to issue the special rights referred to in Chapter 10 of the Limited Liability Companies Act so that the maximum number of new Series B shares to be issued pursuant to the special rights is 3,000,000, which corresponds to approximately 21% of the company's Series B shares. The company did not exercise the authorisation granted at the AGM to issue shares in 2015.
Deferred taxes have not been recognised in the balance sheet. Significant deferred taxes include a deferred tax asset related to confirmed loss, totalling EUR 15.1 million (2015: EUR 3.2 million, 2014: EUR 4.1 million, 2013: EUR 4.4 million, 2012: EUR 3.4 million).
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Loans from Group companies | 301 | 301 |
| Total | 301 | 301 |
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Loans from financial institutions, current portion | 128 | 256 |
| Advances received | 0 | 4 |
| Trade payables | 193 | 483 |
| Accrued liabilities and prepaid income | 494 | 495 |
| Other liabilities | 88 | 85 |
| Liabilities to Group companies | ||
| Trade payables | – | 39 |
| Accrued liabilities and prepaid income | 52 | 49 |
| Total current liabilities | 956 | 1,413 |
Accrued liabilities and pre-paid income include wage and salary accruals totalling EUR 344 thousand (EUR 339 thousand).
| 1,000 € | 2015 | 2014 |
|---|---|---|
| Liabilities for which mortgages have been pledged as collateral | ||
| Company has not issued securities | ||
| Leasing commitments | ||
| Due for payment in the following financial year | 31 | 34 |
| Due for payment at a later date | 20 | 25 |
| Total | 51 | 59 |
| Other rental commitments | ||
| Due for payment in the following financial year | 169 | 168 |
| Due for payment at a later date | 591 | 756 |
| Total | 759 | 924 |
Leasing commitments and rents mainly consist of fixed-term leasing and rental agreements in effect for more than one year.
The company has no contingent liabilities on behalf of Group companies.
| Other contingent liabilities | 2015 | 2014 |
|---|---|---|
| Guarantees | 3 | 3 |
The parent company's distributable funds (non-restricted equity) on 31 December 2015 amounted to EUR 6,079,716.06 with the loss for the financial year accounting for EUR 3,526,862.99. The Board of Directors will propose to the AGM that no dividend be paid for the financial year and that the parent company's loss for the financial year be transferred to retained earnings/losses.
Helsinki 25th of February 2016
Osmo Suovaniemi Chairman of the Board Mikko Salaspuro Member of the Board
Eero Lehti Member of the Board
Seppo Luode Member of the Board Franco Aiolfi Member of the Board Janina Andersson Member of the Board
Semi Korpela President & CEO
We have today issued an auditor's report on the audit performed. Helsinki 25th of February 2016
PricewaterhouseCoopers Oy Authorised Public Accounting Firm
Pasi Karppinen Authorised Public Accountant
We have audited the accounting records, the financial statements, the report of the Board of Directors and the administration of Biohit Oyj for the year ended 31 December, 2015. The financial statements comprise the statement of comprehensive income, balance sheet, statement of changes in equity and statement of cash flows, and notes to the consolidated financial statements, as well as the parent company's balance sheet, income statement, cash flow statement and notes to the financial statements.
The Board of Directors and the Managing Director are responsible for the preparation of consolidated financial statements that give a true and fair view in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU, as well as for the preparation of financial statements and the report of the Board of Directors that give a true and fair view in accordance with the laws and regulations governing the preparation of the financial statements and the report of the Board of Directors in Finland. The Board of Directors is responsible for the appropriate arrangement of the control of the company's accounts and finances, and the Managing Director shall see to it that the accounts of the company are in compliance with the law and that its financial affairs have been arranged in a reliable manner.
Our responsibility is to express an opinion on the financial statements, on the consolidated financial statements and on the report of the Board of Directors based on our audit. The Auditing Act requires that we comply with the requirements of professional ethics. We conducted our audit in accordance with good auditing practice in Finland. Good auditing practice requires that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and the report of the Board of Directors are free from material misstatement, and whether the members of the Board of Directors of the parent company or the Managing Director are guilty of an act or negligence which may result in liability in damages towards the company or whether they have violated the Limited Liability Companies Act or the articles of association of the company.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements and the report of the Board of Directors. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation of financial statements and report of the Board of Directors that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements and the report of the Board of Directors.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
In our opinion, the consolidated financial statements give a true and fair view of the financial position, financial performance, and cash flows of the group in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU.
In our opinion, the financial statements and the report of the Board of Directors give a true and fair view of both the consolidated and the parent company's financial performance and financial position in accordance with the laws and regulations governing the preparation of the financial statements and the report of the Board of Directors in Finland. The information in the report of the Board of Directors is consistent with the information in the financial statements.
Helsinki, 25 February 2016
PricewaterhouseCoopers Oy Authorised Public Accountants
Pasi Karppinen Authorised Public Accountant
Laippatie 1 00880 Helsinki Tel: +358 9 773 861 [email protected]
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