FINANCIAL STATEMENT BULLETIN OF BIOHIT 1
BIOHIT OYJ STOCK EXCHANGE RELEASE 14.2.2003 AT 10:00
FINANCIAL STATEMENT BULLETIN OF BIOHIT 1.1. - 31.12.2002
The net sales of the Biohit Group totalled MEUR 25.4 (MEUR 25.5) and
the loss was MEUR 1.8 (MEUR -0.2). The decrease in net sales resulted
primarily from the weakening of the U.S. economy and the decrease of
sales on the German and Russian markets. In order to improve the
development of its profitability Biohit took into use at the end of
2002 an adaptation program for its activities.
Net Sales
The net sales of the Biohit Group decreased by 0,7% compared with the
previous year and totalled MEUR 25.4 (MEUR 25.5). The Group net sales
decreased especially on the U.S., German and Russian markets. However,
the decrease was compensated by the increase in sales in France, the
U.K. and Asia. In 2002 the Group net sales was generated primarily
from the sales of liquid handling products. However, towards the end
of 2002 there were indications of the anticipated growth in the sales
of diagnostics. The launch of diagnostics continued to be hindered by
the numerous on-going evaluations. The majority of the evaluations
were completed in 2002.
The share of exports of Group net sales was 97%. The primary market
area continued to be Europe which constituted approx. 59% of the Group
net sales. Biohit considers North America and Asia to be important
growth markets; especially in China the sales of liquid handling
products demonstrated a growth.
Result
The loss for 2002 totalled MEUR 1.8 (MEUR 0.2 in 2001). The operating
loss totalled MEUR 1.2 (MEUR 0.2 profit). The operating loss before
goodwill amortization was MEUR 0.6 (MEUR 1.2 profit).
The board of Biohit decided on 27.8.2002 to prolong the goodwill
amortization period related to Locus genex Oy from seven to 20 years.
The decision of this change is based on the information on the market
and, e.g., on the feedback of GastroPanel evaluations, according to
which the company estimates that the accumulated income effect is
longer than it was estimated at first, and at least 20 years.
According to the board decision there will be no amortizations from
the Locus genex goodwill during the last half of the year 2002,
because the amortization according to plan (MEUR 0.4) made for the
first half year was based on the original 7 years´ amortization
period.
The Group result was weakened by the development of net sales, which
did not reach the anticipated level, and by the increase of fixed
costs. The increase in fixed costs resulted primarily from investments
made in international sales and marketing which, on their part,
increased personnel costs. The dismissals and personnel reductions
made at the parent company during the last quarter of 2002 did not yet
have an improving effect on the overall cost structure of the Group.
The net financial expenses totalled MEUR 0.3 (MEUR 0.2).
The income taxes (MEUR 0.3) have been accounted for on the basis of
the result for the financial year. However, deferred tax assets
relating to the taxable losses have not been accounted for. MEUR 0.2
of the income taxes charged to the income statement result from the
decrease in the deferred tax assets relating to the dissolution loss
on Locus genex Oy.
Earnings per share were EUR -0.14 (EUR -0.02).
Liquidity
The net cash flow provided by operating activities was MEUR 0.5
negative (MEUR 1.9 positive). The cash flow from operating activities
was weakened considerably due to the payment of 2001 taxes (MEUR 1.1)
related to the voluntary dissolution of Locus genex Oy. The Groups
liquid assets totalled MEUR 1.4 (MEUR 2.5) at the end of the fiscal
year.
The gearing ratio was 66.9% on December 31, 2002 (65.7%).
Investments
The gross investments totalled MEUR 1.6 (MEUR 2.1). The major part of
the investments consisted of machinery, equipment acquired to the
Kajaani plant for the automation of liquid handling products, as well
as of injection moulding tools used in the production of liquid
handling devices.
The Group research and development expenditure totalled MEUR 1.8 (MEUR
2.1), i.e., 7.1% (8.3%) of net sales.
Personnel
The average number of personnel totalled 303 (289), of which 181 (176)
were employed by the parent company and 122 (113) by the subsidiaries
(113). The increases in personnel resulted from the investments made
in 2002 in the subsidiaries to strengthen internation sales.
Main Events of the Reporting Period
Liquid Handling
In the area of liquid handling Biohit continued to develop new
pipettor generations. This development work is based on Biohits
liquid handling product strategy in which new market segments have
been identified and created. These segments differ from each other in
terms of the area of application, performance and price.
In its development of liquid handling products Biohit has paid special
attention to the safety and ergonomic aspects of pipettors, which
contribute, e.g., to reducing the risk of work-related upper limb
disorders.
In the area of liquid handling Biohit continued to broaden its eLINE-
range. During the reporting period Biohit launched the single-channel
model for the volume range of 100 - 5,000 ul. As a result, the entire
single-channel eLINE -product range has been completed. The said
single-channel family covers the volume range of 0.2 - 5,000 ul.
Biohits new generation electronic eLINE-range has been developed for
the most demanding liquid handling applications. The microprocessor-
control and novel construction enable maximum liquid handling
performance with very high levels of accuracy and precision. The
ergonomical design of the eLINE-range together with electronic tip
ejection reduce considerably the risk of work-related upper limb
disorders.
In the area of mechanical liquid handling products Biohit launched the
new mLINE -product family which covers the volume range 0.5-5,000 ul.
The launched single-channel pipettor is completely autoclavable, and
in its development work special attention has been paid to its
ergonomical properties.
In the area of liquid handling Biohit was awarded in 2002 the
following patents: Finnish patent FI 109407 for the invention "Suction
Device" (31.7.2002), Finnish patent FI 109882 for the invention
"Pipette" (31.10.2002), US-patent 6,482,361 for the invention "Suction
Device" (19.11.2002) and US-patent 6,499,364 for "Tip for a Suction
Device" (31.12.2002).
In 2002 the accredited calibration laboratory of Biohit was certified
in accordance with the ISO 17025 -quality standard. Moreover, the
capacity of the plastics production at the plant in Kajaani was
increased considerably and the automation of production was continued.
Diagnostics
The evaluations of the test panel for determining Helicobacter pylori
-infection and atrophic gastritis and for screening the risk of
gastric cancer and peptic ulcer from blood samples (GastroPanel)
continued according to plans.
By the end of 2002 seventeen clinical evaluations related with the
GastroPanel had been completed. Thirteen had been made in Europe,
three in Asia and one in North America. The number of patients studied
in the evaluations totalled 3,208. The results of the said evaluations
have been published internationally in numerous scientific articles.
During the reporting period altogether twelve evaluations were in
progress. Eight evaluations were in progress in Europe, two in Africa,
one in Asia and one in the Near East. The number of patients to be
studied in these evaluations totals 4,280. By the end of 2002
preliminary agreements had been made or negotiations begun to commence
eleven new evaluations in Europe, three in North and South America and
three in Asia.
In 2002 Biohit received the first customer orders for the GastroPanel
test. Biohit concluded distribution agreements for the GastroPanel,
not only in Italy but also in numerous South American and Near Eastern
countries, in which the prevalence of Helicobacter pylori infection is
approx. 90%. Especially on these markets and in the developing
countries the GastroPanel serves as the only easy and economically
sound alternative for the diagnosis of atrophic gastritis caused by
Helicobacter pylori infection and for assessing the risk factors for
related diseases, e.g., gastric cancer and peptic ulcer. During the
reporting period the GastroPanel was used at the Jorvi Hospital (HUCH:
The Helsinki University Central Hospital) in Finland and in service
laboratories in Finland, Germany and Italy.
In the area of diagnostics Biohit was awarded in 2002 the following
patents related with the GastroPanel: U.S. patent 6,416,961 for the
Diagnosis of Early Gastric Cancer (9.7.2002) and the European patent
0804737 for the Method for Screening the Risk of Gastric Cancer
(13.2.2002). Moreover, Biohit was awarded the European patent 0812421
(19.6.2002) for a method for diagnosing systemic lupus erythematosus
(SLE). SLE is a connective tissue disease, which resembles rheumatic
diseases.
Subscription of Shares on the Basis of Option Rights
On the basis of Biohits personnel option program 1999 and the option
program 1999/II targeted to Jencons Scientific Ltd. altogether 294,250
B-shares of Biohit were subscribed between 1.1.-30.9.2002.
Increases in Share Capital
As a result of the subscription of shares made on the basis of the
1999 personnel option program and the option program targeted to
Jencons Scientific Ltd., the share capital of Biohit increased during
the financial year by EUR 50,022.50 (294,250 shares) to EUR
2,199,396.59 (12,937,627 shares). The share premium of EUR 518,657.50
has been recorded in the premium fund.
Development of the Price of Biohits B-Share
In 2002 the turnover of Biohits B-share at the Helsinki Exchanges was
EUR 3,017,824.28 and 1,178,003,00 in pieces. The highest price was EUR
4.40, the lowest EUR 1.40 and the average price EUR 2.56. The closing
price at the end of 2002 was EUR 1.41.
Administration
During the financial year the following persons have been members of
the Board of Directors of Biohit Plc. Professor Reijo Luostarinen as
the Chairman, and docent Arto Alanko, professor Hannu Seristö,
professor Osmo Suovaniemi, M.D., Ph.D. and professor Mårten Wikström
as members. Osmo Suovaniemi acted as the Managing Director of Biohit
Oyj.
PricewaterhouseCoopers Oy have acted as Authorized Public Accountants
and Hannele Selesvuo as the Authorized Public Accountant.
Future Prospects
Net sales is expected to develop favorably in 2003. However, the
uncertainties relating with the general economic development of the
major market areas renders the drawing up of forecasts difficult.
The positive expectations relating with liquid handling products
result from the favorable feedback received from the markets for the
new mechanical pipettor range (mLINE), which was launched at the end
of 2002. Moreover, during 2003 Biohit will launch new liquid handling
products. Although it is estimated that the major part of net sales
will be generated by liquid handling devices in 2003 Biohit
anticipates that the sales of diagnostics will demonstrate an increase
in 2003.
In order to improve the profitability Biohit took into use in 2002 an
adaptation program of its activities. In accordance with the program
the company aims, e.g., to intensify marketing efforts and cut costs.
Biohit will continue the adaptation program also during 2003. It is
expected that the measures will improve significantly the
profitability of the Group.
Group Income Statement
1-12 2002 Change 1-12 2001
MEUR % MEUR
Net sales 25.4 -1 25.5
Operating expenses -24.4 6 -23.0
Depreciation without
goodwill amortization -1.5 -20 -1.3
Operating profit before
goodwill amortization -0.6 149 1.2
% Net Sales 2.4% 4.9%
Goodwill amortization -0.6 -38 -1.0
Operating profit/Loss -1.2 -618 0.2
% Net Sales -4.8% 0.9%
Financial expenses, net -0.3 74 -0.2
Profit/loss before
extraordinary items -1.5 -2902 -0.1
Extraordinary income 0.0 0 0.0
Profit/Loss before taxes -1.5 -2902 0.1
Loss for the period -1.8 -673 -0.2
Group Balance Sheet
31.12.2002 31.12.2001
MEUR % MEUR %
Assets
Non-current assets
Intangible assets 4.2 19 4.8 19
Tangible assets 6.4 29 6.4 26
Financial assets 0.2 0 0.2 1
Current assets
Inventories 3.6 16 4.3 17
Receivables 5.3 24 5.3 21
Deferred tax assets 1.3 6 1.5 6
Cash and cash
equivalents 1.4 6 2.5 10
Total assets 22.4 100 25.0 100
Liabilities and
shareholders equity
Shareholders equity
Share capital 2.2 10 2.2 9
Share premium fund 15.4 69 14.9 60
Accumulated
losses -2.8 -13 -0.8 -3
Capital loans 1.2 6 1.2 5
Minority interest 0.1 0 0.1 0
Long-term liabilities 2.5 11 2.1 8
Short-term
liabilities 3.8 17 5.3 21
Total liabilities
and shareholders
equity 22.4 100 25.0 100
Cash Flow
1-12/2002 1-12/2001
MEUR MEUR
Cash flow from operating
activities
Profit/loss before -1.5 0.1
extraordinary items
Adjustments 2.4 2.4
Change in net working capital -0.1 -0.1
Interest and other financial -0.2 -0.4
items paid
Interests received 0.1 0.1
Income taxes paid -1.2 -0.2
Net cash flow from operating -0.5 1.9
activities
Net cash flow from investing
activities:
Investments in tangible and -1.7 -2.1
intangible assets
Grants received 0.1 0.4
Net cash flow from investing -1.6 -1.7
activities
Net cash flow from financing
activities
Proceeds from share issue 0.6 0.0
Increase in long-term loans 0.9 0.1
Repayments of long-term loans -0.5 -0.9
Increase in capital loans 0.0 0.1
Net cash flow from financing 1.0 -0.7
activities
Net increase (+)/decrease (-) -1.1 -0.5
in cash and cash equivalents
Cash and cash equivalents 1.1. 2.5 3.0
Cash and cash equivalents at
the end of the year 1.4 2.5
1-12/02 Change Change-% 1-12/01
Investments, gross
Fixed assets MEUR 1.6 -0.5 -25 2.1
Employees, average 303 14 5 289
Employees at the end
of financial year 283 -22 -7 305
31.12.2002 31.12.2001
MEUR MEUR
Mortgages and shares pledged
for liabilities
Loans from financial
institutions 2.1 1.9
Corporate mortgages 3.4 3.4
Pledges on leaseholds 1.5 0.0
Other long-term liabilities 0.8 0.8
Mortgages 0.8 0.8
Leasing commitments 4.1 4.0
Derivative Contracts
The Group does not have any off balance sheet financial instruments.
Interest on Capital Loans
The unrecorded interest accrued on capital loans totalled to MEUR 0.5
on Dec. 31, 2002 and to MEUR 0.4 on Dec. 31, 2001.
31.12.2002 31.12.2001
Ratios
Equity ratio, % 66.9 65.7
Earnings per share, EUR -0.14 -0.02
Shareholders equity
per share, EUR 1.15 1.28
Average number of shares 12,827,781 12,643,377
Number of shares at the
end of the period 12,937,627 12,643,377
Proposal for the Distribution of Profit
The Group does not have distributable earnings. The Board of Directors
proposes that no dividends be paid.
The figures of the Financial Statement Bulletin are unaudited.
Helsinki, February 14, 2003
Board of Directors of Biohit Oyj
Helena Hentola
Corporate Communications
Additional information: Osmo Suovaniemi, Professor, President & CEO,
tel: +358-9-773 861, direct: +358-9-773 86
250, mobile: +358-40 745 5605, fax: +358-9-
773 86 205, osmo.suovaniemi@biohit.com.
http://www.biohit.com
Distribution: Helsinki Exchanges
The Financial Supervisory Authority
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