INTERIM REPORT OF BIOHIT GROUP 1 JANUARY TO 30 JUNE 2006
BIOHIT OYJ STOCK EXCHANGE RELEASE 4 AUGUST 2006 10:00 AM
INTERIM REPORT OF BIOHIT GROUP 1 JANUARY TO 30 JUNE 2006
The Biohit Group had total net sales of EUR 15.2 million during
the reporting period (EUR 13.6 million in 1Q-2Q/2005). The
operating loss for the reporting period was EUR 0.3 million
(operating loss EUR 0.6 million). The loss for the reporting
period was EUR 0.6 million (loss EUR 0.6 million). The result was
weakened by increased fixed costs and finance costs.
Net sales
The Biohit Group net sales increased 12 % compared with the
corresponding period in 2005 and totalled EUR 15.2 million (EUR
13.6 million). Of the Groups net sales 94.7 % were generated
primarily from the sale of liquid handling products and
maintenance services for liquid dispensers. The liquid handling
business net sales were EUR 14.4 million (EUR 13.0 million), the
net sales for the diagnostics business being EUR 0.8 million (EUR
0.6 million).
Result
The operating loss was EUR 0.3 million (operating loss EUR 0.6
million). The loss for the reporting period was EUR 0.6 million
(loss EUR 0.6 million).
The operating profit of the liquid handling business was EUR 1.0
million (operating profit EUR 0.7 million), the operating loss of
the diagnostics business being EUR 1.3 million (operating loss EUR
1.3 million).
The Groups result is burdened by increased fixed costs and
finance costs. The increase in fixed costs stems from, for
example, outlays associated with operations in China and increased
personnel, sales and marketing expenses.
Balance sheet
The balance sheet total was EUR 28.0 million (EUR 23.3 million)
and the equity ratio was 48.6 % (59.0 %) on 30 June 2006. The
balance sheet total was increased and the equity ratio decreased
by the issuance of a EUR 4.05 million convertible bond in November
2005. In accordance with a decision made at the Annual General
Meeting on 20 April 2006, the share premium fund has been used to
cover the parent company's EUR 0.6 million losses for 2005.
Liquidity
During the reporting period, the operating activities had a net
cash flow of EUR -0.3 million (EUR 0.4 million). At the end of the
reporting period, the liquid assets of the Group totalled EUR 0.9
million (EUR 1.2 million).
Investments
Gross investments in the reporting period totalled EUR 1.1 million
(EUR 0.8 million). The costs mainly consist of equipment for the
automation of liquid handling product manufacture at the Kajaani
and Helsinki production facilities, as well as investments made in
the production facility in China.
Personnel
The average number of personnel in the reporting period was 293
(296), with 158 (161) persons being employed by the parent company
and 135 (135) by the subsidiaries.
Main events of the reporting period
Liquid handling business area
Biohits liquid handling business includes mechanical and
electronic liquid dispensers as well as disposable tips. In
addition, the company offers services related to the maintenance
and calibration of liquid handling products as well as training
services on these products. The companys liquid handling products
are combined with diagnostic products, instruments and related
software, forming comprehensive analysis systems for research and
clinical diagnostics.
During the review period, Biohit has reached agreements on the
launch of its pipettor maintenance concept in several countries in
the companys main market areas. Biohit has begun determined
efforts towards developing a consistent, global maintenance
concept whose aim is end-to-end management of the pipettor life
cycle and increased customer satisfaction. This concept has
already been introduced in Finland and at subsidiaries, and will
gradually be extended to all main market areas through the
distributor network.
During the reporting period, Biohits liquid handling business was
granted the international ISO 13485 certificate issued by Det
Norske Veritas. (ISO 13485:2003: Medical devices. Quality
management systems. Requirements for regulatory purposes) ISO
13485 quality standards are especially important for Biohits OEM
business, in which the majority of its customer base uses Biohits
liquid handling products in diagnostic test and analysis systems.
During the reporting period, Biohit began co-operation with a
North-American company concerning the delivery of robotic
pipettors used in instrumentation.
Additionally, the company has brought to market a new mechanical
single-channel mLINE pipettor for small volumes (0.1-3 µl) during
the reporting period.
Diagnostics
In the diagnostics business, Biohit focuses on the research,
development, production, and marketing of products for the
screening, prevention, and diagnosis of diseases of the
gastrointestinal tract. The companys diagnostic products include
the GastroPanel examination performed on a blood sample
(biomarkers: Pepsinogen-I, Pepsinogen-II, Gastrin-17, and
Helicobacter pylori antibodies), for the diagnosis of upper
abdominal complaints (dyspepsia), H. pylori infection, atrophic
gastritis and associated risks (gastric cancer, vitamin B12
deficiency and peptic ulcer disease). In addition, GastroPanel
reveals the risk of gastroesophageal reflux disease. The company
also provides biopsy specimen quick tests for the diagnosis of
lactose intolerance and H. pylori infection. The companys
diagnostic products are combined with pipettors, globally used
analysis instruments featuring vertical photometry technology and
related software to offer comprehensive analysis systems for
research and clinical diagnostics.
During the reporting period, the company revealed its plans to
bring to market new products and procedures for preventing the
risks of gastrointestinal cancers. Medical research has proved
that products containing L-cysteine can eliminate the acetaldehyde
that is locally produced by microbes and which places people at
risk from cancers of the mouth, esophagus and stomach.
As a result of co-operation carried out with researchers, Biohit
is bringing XyliCyst chewing gum to market this year. This chewing
gum eliminates the acetaldehyde that builds up in saliva during
smoking and therefore helps prevent oral cancers. The company aims
to develop other products (BioCyst capsules, for example) that
will also enable the effective elimination of acetaldehyde in the
gastrointestinal tract.
The need to use stomach-related acetaldehyde-inactivating products
with meals may be determined safely and economically using the
GastroPanel examination developed by Biohit. The company has
submitted a patent application on, among others, the use of
cysteine or similar compounds to inactivate the acetaldehyde
present in numerous foodstuffs. Biohit plans to make use of this
invention by licensing it for use in the food industry.
During the reporting period Biohit has made several agreements
regarding sales and marketing of diagnostics products with
distributors in various countries: InGen in France; BioDiagnostics
in Greece; Cetus in Iceland; and Peramedical in Turkey.
GastroPanel was cleared for marketing and distribution in Ukraine
during the reporting period.
Operations in China
Until spring this year, Biohits operations in China have been
managed through local representatives. During the spring, however,
Biohit has expanded its operations in China so that the company
has a unit focused on sales and marketing in Shanghai and a
production facility in Suzhou. The majority of steps for starting
up the Suzhou production unit have been completed, and production
will begin during the third quarter of this year.
A Change in Biohit Oyjs shareholding
On 21 June 2006, Pentti Sipponen gave notification that he had
acquired 900,000 Biohit Oyj Series A shares from Erja-Yhtymä Oy.
After the flagging notification, the holding in Biohit Oyjs share
capital and voting rights of the shareholder (Pentti Sipponen),
and the holder of shares falling under his shareholding (Patolab
Oy), was as follows:
No of shares Votes % Share capital %
Series A shares 900,000 20.79 6.95
Series B shares 26,600 0.03 0.21
Distribution of holdings:
Pentti Sipponen: 900,000 Series A shares and 14,300 Series B
shares.
Patolab Oy: 12,300 Series B shares.
The date of change in holdings was 21 June 2006.
Equity Turnover and Price Development
During the reporting period, the total turnover of Biohits B-
shares on the Helsinki Exchange NM list amounted to EUR 2,140,734
and the number of shares traded was 910,202. The highest share
price was EUR 2.61 and the lowest EUR 2.12, the average price
being EUR 2.35. The closing price at the end of the reporting
period was EUR 2.38. On 30 June 2006, the market capitalisation
value for the B shares totalled EUR 21,183,453.
Outlook for 2006
According to the companys estimates, net sales of both liquid
handling and diagnostics products will continue to grow during the
rest of the year. Net sales for the whole year are therefore
expected to be up on the previous year.
The Groups result for the first part of the year has been
burdened by an increase in fixed costs. Because these costs are
partly non-recurring expenses, the result for the whole year is
still expected to be up on the previous year.
This interim report has been prepared in accordance with IFRS
(International Financial Reporting Standards), using IFRS
recognition and measurement principles. This interim report does
not comply with all of the requirements of IAS 34 (Interim
Financial Reporting).
All the figures in the interim report have been rounded up or
down, due to which the sums of figures may deviate from the sum
total presented.
Consolidated income statement
1-6 1-6 1-12
2006 2005 Change Change 2005
MEUR MEUR MEUR % MEUR
Net sales 15.2 13.6 1.6 12 28.7
Other operating income 0.0 0.1 0.0 -75 0.1
Change in inventories of
finished goods and work in
progress 0.6 0.1 0.4 378 0.4
Raw materials and consumables -2.8 -2.3 0.5 22 -5.1
External services -0.7 -0.5 0.2 46 -1.0
Employee benefit expenses -6.5 -6.0 0.5 8 -11.6
Depreciation -0.9 -0.8 0.1 8 -1.7
Other operating expenses -5.3 -4.8 0.5 10 -9.8
Operating profit / loss -0.3 -0.6 0.3 43 0.0
Financial expenses (net) -0.2 -0.0 0.2 -3229 -0.2
Profit / loss before tax -0.6 -0.6 0.0 3 -0.2
Income taxes -0.1 -0.0 0.1 178 0.0
Profit / loss for the period -0.6 -0.6 0.0 -7 -0.2
4-6 4-6
2006 2005 Change Change
MEUR MEUR MEUR %
Net sales 7.6 7.3 0.3 5
Other operating income 0.0 0.1 -0.1 -87
Change in inventories of
finished goods and work in
progress 0.3 -0.2 0.5 -273
Raw materials and consumables -1.4 -1.0 0.4 42
External services -0.4 -0.3 0.1 49
Employee benefit expenses -3.3 -3.1 0.2 6
Depreciation -0.4 -0.4 0.0 9
Other operating expenses -2.7 -2.3 0.4 18
Operating profit / loss -0.3 0.1 -0.4 -513
Financial expenses (net) -0.1 -0.1 0.0 1872
Profit / loss before tax -0.4 0.0 -0.4 -714
Direct taxes -0.0 -0.0 0.0 71
Profit / loss for the period -0.4 0.0 -0.4 -1576
Group net sales by business segment
1-6 1-6
2006 2005 Change Change
MEUR MEUR MEUR %
Liquid handling 14.4 13.0 1.5 11
Diagnostics 0.8 0.6 0.2 28
Group operating result by business segment
1-6 1-6
2006 2005 Change Change
MEUR MEUR MEUR %
Liquid handling 1.0 0.7 0.3 43
Diagnostics -1.3 -1.3 -0.0 1
Consolidated balance sheet
30.6.2006 30.6.2005 31.12.2005
MEUR % MEUR % MEUR %
Assets
Non-current assets
Tangible assets 7.0 25 6.6 28 6.7 24
Goodwill 2.6 9 2.6 11 2.6 9
Other intangible
assets 1.5 5 1.4 6 1.6 6
Deferred tax assets 2.0 7 1,9 8 2.1 8
Total non-current
assets 13.1 47 12.5 53 13.0 47
Current assets
Inventories 5.4 19 4.1 18 4.6 16
Trade and other
receivables 8.5 31 5.5 24 8.5 31
Cash and cash
equivalents 0.9 3 1.2 5 1.8 6
Total current
assets 14.9 53 10.8 47 14.9 53
Total assets 28.0 100 23.3 100 27.9 100
Equity and
liabilities
Share capital 2.2 8 2.2 10 2.2 8
Share premium fund 12.4 44 12.8 55 13.0 47
Retained earnings -1.1 -4 -1.4 -6 -0.9 -4
Total equity 13.5 48 13.6 59 14.3 51
Non-current
liabilities
Interest-bearing
liabilities 7.6 27 4.2 18 7.7 28
Deferred tax
liabilities 0.1 0 0.1 0 0.1 0
Pension obligations 0.1 0 0.1 0 0.1 0
Other liabilities 0.7 3 0.6 3 0.6 3
Total non-current
liabilities 8.5 30 5.0 21 8.5 31
Current liabilities
Trade and other
payables 5.4 19 3.9 16 4.2 15
Current interest-
bearing liabilities 0.6 2 0.8 4 0.9 3
Total current
liabilities 6.0 21 4.7 20 5.1 18
Total liabilities 14.5 52 9.7 41 13.6 49
Total equity and
liabilities 28.0 100 23.3 100 27.9 100
Consolidated cash flow statement
1-6/2006 1-6/2005 1-12/2005
MEUR MEUR MEUR
Cash flow from operating
activities:
Profit / loss before tax -0.6 -0.6 -0.2
Adjustments 1.0 1.1 1.9
Change in working capital -0.7 0.0 -0.8
Interest and other
financial items paid -0.1 -0.2 -0.3
Interest received 0.1 0.1 0.1
Income taxes paid 0.0 0.0 -0.1
Net cash flow from
operating activities -0.3 0.4 0.6
Cash flow from investment
activities:
Investments in tangible
and intangible assets -0.9 -0.7 -1.7
Investments in funds and
deposits 0.0 -3.4
Capital gain from
investments in funds and
deposits 1.6
Net cash flow from
investment activities 0.8 -0.7 -5.1
Cash flow from financing
activities:
Proceeds from loans 0.1 0.8 4.8
Repayment of loans -0.4 -0.6 -1.0
Net cash flow from
financing activities -0.3 0.2 3.8
Increase (+) / decrease (-
) in cash and cash
equivalents 0.2 -0.1 -0.6
Cash and cash equivalents
at beginning of period 0.7 1.3 1.3
Cash and cash equivalents
at end of period 0.9 1.2 0.7
Consolidated statement of changes in equity on 30 June 2006
MEUR Share Share Trans- Earnings Equity
capital premium lation
fund diff.
Equity 1 Jan 2006 2.2 13.0 0.2 -1.1 14.3
Transfer from Share
Premium Fund -0.6 0.6
Translation differences -0.1 -0.1
Profit/loss for the period -0.6 -0.6
Equity 30 June 2006 2.2 12.4 0.1 -1.2 13.5
Consolidated statement of changes in equity on 30 June 2005
MEUR Share Share Trans- Earnings Equity
capital premium lation
fund diff.
Equity 1 Jan 2005 2.2 13.1 0.0 -1.2 14.1
Transfer from Share
Premium Fund -0.3 0.3
Translation differences 0.1 0.1
Profit/loss for the period -0.6 -0.6
Equity 30 June 2005 2.2 12.8 0.1 -1.5 13.6
1-6/06 1-6/05 Change Change % 1-12/05
Investments, gross, MEUR 1.1 0.8 0.2 30 2.0
% of net sales 7.0 6.0 7.0
Average number of
employees 293 296 -3 -1 295
Collateral, contingent liabilities and other commitments
30.6.2006 30.6.2005 31.12.2005
MEUR MEUR MEUR
Mortgages and pledged assets
Loans from financial
institutions 1.9 2.5 2.3
Corporate mortgages 1.8 1.6 1.6
Mortgages on real estate 1.4 1.4 1.4
Other long-term liabilities 0.5 0.6 0.5
Mortgages on real estate 0.8 0.8 0.8
Leasing commitments 4.7 3.9 3.8
Key ratios 30.6.2006 30.6.2005 31.12.2005
Equity ratio % 48.6 59.0 51.5
Earnings per share, EUR -0.05 -0.05 -0.02
Shareholders equity per
share 1.04 1.06 1.10
Average number of shares 12,937,627 12,937,627 12,937,627
Number of shares at the end
of period 12,937,627 12,937,627 12,937,627
The figures in the Interim Report are not audited.
Helsinki on 4 August 2006
Board of Directors of Biohit Oyj
Additional information:
Osmo Suovaniemi, M.D., Ph.D., Professor
President & CEO
Tel: +358-9-773 861
GSM: +358-40-745 5605
Email: osmo.suovaniemi@biohit.com
Distribution:
Helsinki Exchanges
Financial Supervisory Authority
Press
http://www.biohit.com
