Ygeia TopHolding AB
Corp. Reg No. 556706-3580
presents its
Annual Report
for the financial year
1 January 2009 - 31 December 2009
Contents
Page
Board of Directors’ Report
Consolidated statement of Comprehensive income
Consolidated statement of Financial position
Consolidated statement of Cash flow
Consolidated statement of Changes in Equity
Accounting principles
Notes
Parent Company income statement
Parent Company balance sheet
Parent Company cash flow statement
Parent Company changes in shareholders' equity
Accounting principles
Notes
Signatures
1
5
6
7
8
9
20
50
51
52
53
54
55
56
Board of Directors’ report for Ygeia TopHolding AB
The Board hereby presents the Annual Report and consolidated financial statements for Ygeia TopHolding AB
for the financial year 1 January to 31 December 2009.
Ygeia TopHolding AB, 556706-3580 with its registered office in Stockholm, conducts operations in healthcare
and diagnostics services through its subsidiaries in the Capio Group and the Unilabs Group respectively. The
operations are conducted on commissions from and in cooperation with public healthcare authorities, insurance
companies, other organisations and individuals. To streamline operations between Capio and Unilabs, the
parent company Ygeia TopHolding AB in December 2009 distributed all shares in Unilabs Holding AB to the
parent company in Luxembourg at an Extraordinary General Meeting. As a result of this, net loss from the
diagnostics services is reported as loss for the period from discontinuing operations. The Ygeia TopHolding
Group, referred to below as "the Group," has after distribution of the Unilabs Group units in Sweden, Norway,
United Kingdom, Germany, France, Spain, Portugal and Switzerland.
Ownership structure
The ultimate parent company of Ygeia TopHolding AB is Capio Lux TopHolding S.Á.R.L, with its registered
office in Luxembourg. This company is jointly owned by funds advised by Apax Partners Worldwide LLP, by
funds advised by Nordic Capital and by funds advised or managed by Apax Partners SA.
The Group's objective
The Group's operations aim to provide high quality efficient healthcare for private and public customers in
Europe.
Organisation
The Group conducts healthcare operations through its business areas Capio Healthcare Spain, Capio Healthcare
France, Capio Healthcare Nordic (including Norway, Sweden – Hospitals, Sweden – Proximity care and
Sweden – Specialist clinics) and Capio Healthcare Germany. Smaller operations are also conducted within
Psychiatry in the UK.
Significant events during the financial year
Distribution of the Unilabs operations
In December 2009 the distribution of the Unilabs Group to the parent company in Luxembourg was effected at
an Extraordinary General Meeting. As a result of this, net loss from the Unilabs operations is reported as loss
for the period from discontinuing operations in the consolidated income statement 2009. As at December 31,
2008 Unilabs was recognised in the balance sheet at the consolidated carrying amount and as net loss and cash
flow from discontinued operations for the period January to December 2008. Consolidated equity was
negatively affected by 134 MSEK from the divestment of Unilabs to the parent company in Luxembourg.
Acquisition of group companies
A number of small acquisitions were also completed by Group companies in Sweden, Spain and Norway during
the financial year.
Early termination of financial lease
During the financial year a financial lease agreement regarding a building in London was early terminated. In
the annual accounts as of December 2008 37 MSEK was provided for this termination. The final cost was 42
MSEK, why the income statement was charged with additional 5 MSEK in 2009.
Change from a cost based to a functional income statement report
During the year the Group has changed from reporting a cost based income statement to a functional income
statement in the internal operational reporting. This has implied some changes e.g. regarding reporting of Other
operating income and Other operating expenses. For a further description of implications of the change in
income statement reporting for the Group, see Note 35.
Ygeia TopHolding AB
1 / 56
Sales
Sales amounted to 15,728 MSEK (12,849). The increase between the periods is primarily attributable to
additional operations in the form of acquisitions and start-ups as well as changes in the EUR/SEK exchange
rate.
Financial position and equity/assets ratio
At the end of the financial year, cash and cash equivalents amounted to 518 MSEK (444). Net financial items
amounted to an expense of 1,007 MSEK (expense: 1,216) for the period.
Shareholders’ equity at year-end amounted to 2,545 MSEK (3,478), giving an equity/assets ratio of 11.5 per
cent (11.2).
Consolidated cash flow from operating activities amounted to 1,049 MSEK (467). Investments for the period
amounted to 724 MSEK (705). The Group’s pledged assets and contingent liabilities amounted to 13,645
MSEK (14,293).
The combined operating profit from continuing operations amounted to 1,068 MSEK (546). This corresponds
to an operating margin of 6.8 per cent (4.2) for the period from January to December 2009. Operating profit for
the corresponding period 2008 was charged with an impairment loss of 33 MSEK regarding a building in the
UK, and 37 MSEK pertaining to a provision for the termination of a long-term lease in the UK.
Personnel
The number of employees of the Group at year-end was 15,264 (13,750), while the average number of
employees for the year was 16,288 (14,641), of whom 3,204 (2,605) were in Sweden at continuing operations.
Research and development
Investments in research and development are focused on patient-related clinical research and healthcare
research as well as scientific training and clinical development of new research results. Within a number of
specialties, cooperation involving medicinal trials and joint research projects with other healthcare providers
takes place. Research and development costs account for a small portion of operating costs.
Environment
The Group has an environmental policy entailing that every unit shall work actively to improve the environment
through conservation of resources and strive to recycle. Environmental measures should be adapted to the needs
of operations and their environmental impact. The Group focuses especially on purchasing, transportation,
energy consumption and chemical products.
The Group pursues operations requiring permits pursuant to the Swedish Environmental Code through some of
its Swedish subsidiaries. Impact upon the external environment primarily involves environmentally hazardous
chemicals used in the production of services. Examples of these include film and chemicals used to develop
film as part of radiological operations.
Risks and key uncertainties
The Group is exposed, through its international operations, to a variety of risks that may give rise to fluctuation
in income, other comprehensive income and cash flow.
Key areas of risk encompass political, operative and financial risks. Various policies and instruments govern
the management of key risks. The following is an overall description of areas of risk, and refers to relevant
notes of the financial statements.
Political risks
The single greatest risk for the Group involves political decisions that change market conditions. This risk for
the Group as a whole is limited by the fact that each Group business area operates in a variety of countries.
Ygeia TopHolding AB
2 / 56
Operational risks
The Group is active in areas involving extensive regulation and the treatment of patients entailing the risk of
complications. By standardising materials, equipment and processes, the Group improves efficiency, increases
quality and enhances patient safety in order to manage the operational requirements imposed on healthcare
companies.
Financial risks
The main task of each business area's finance function is to support operating activities and to identify and
optimally limit the Group’s financial risks in accordance with the financial policy established by the Board.
Financial activities are centralised to capitalise on economies of scale, improve internal control and facilitate
risk reviews.
Financial operations at the various business areas aim at improving cash flow through focusing on profitability
and minimising operating capital employed. For countries with a number of subsidiaries, surpluses and deficits
are matched via a Group account (Cashpool).
Credit risks/counterparty risks
Credit risks can arise through a counterparty’s failure to fulfil its commitments in accordance with signed agreements.
The risk that a counterparty fails to fulfil its obligations in accordance with financial contracts is limited by
choosing creditworthy counterparties and by limiting the level of involvement with each counterparty.
Exchange rate risks
Exchange-rate fluctuations impact the Group’s earnings and shareholders’ equity in different ways. Transaction
risk involves commercial flows in foreign currencies that expose earnings to the risk of being impacted in the
event of exchange-rate fluctuations. Transaction risks are deemed less significant. Translation of foreign
subsidiaries’ income statements and net assets into SEK involves the risk that exchange-rate fluctuations may
impact the Group’s profit and other comprehensive income. The Group aims to hedge net assets in foreign
currencies through the corresponding weighting of borrowing and thus match the cash flows of each currency.
Interest-rate risks
Changes in market interest rates affect the Group’s net interest income. The speed of the impact of any change
in interest rates on net interest income depends on the fixed-interest terms of the loan portfolio. Financial
instruments, primarily swap agreements, are employed to reduce interest-rate risk and to attain the desired
balance of fixed-interest periods in the loan portfolio.
Liquidity risks
The Group ensures a favourable level of financial preparedness by always keeping a certain portion of sales in
cash and cash equivalents.
An appropriate balance between short and long-term borrowing and contingency borrowing arrangements in the
form of credit facilities are used to ensure long-term financing needs.
Additional details regarding financial risk management may be found in Note 16.
Current legal disputes
The Group’s operations are involved in a number of minor disputes, which are considered a customary element of the
operations.
Future development
The Group’s basic underlying strategies remain in place. Continued growth and profitability will be focused on
in all business areas in forthcoming periods. Growth is expected to be driven organically and through
acquisitions.
Ygeia TopHolding AB
3 / 56
Events after the balance-sheet date
Divestments
Divestment of the business in Switzerland (part of Capio Healthcare Germany) was concluded in January 2010.
New contracts
Capio Spain is part of a consortium that have been nominated preferred bidder status for a new 30 year care
concession agreement with the Madrid authorities. Capio Spain has the main responsibility for running the care
operations of the hospital which is located in the Mostoles area and has a responsibility to provide healthcare to
an approximate population of 170,000 inhabitants. The new hospital is expected to be fully operational in 2012.
Parent Company
The Parent Company comprises a holding company in the Group and did not conduct any operations in 2009.
Appropriation of profits
Proposed disposition of unappropriated profits
The following profits are at the disposal of the Annual General Meeting:
Profit brought forward
Share premium reserve
Net profit for the year
Total
0
3,173
0
3,173
MSEK
MSEK
MSEK
MSEK
The Board proposes that the earnings at the disposal of the meeting be appropriated at follows:
To be carried forward: 3,173 MSEK
Ygeia TopHolding AB
4 / 56
Consolidated statement of Comprehensive income
MSEK
Notes
Jan.-Dec.
2009
Jan.-Dec.
2008
Net sales
1, 35
15 728
12 849
35
-2 912
-2 550
22, 23, 34, 35
-2 087
-1 702
4, 5, 35
-8 764
-7 281
Direct materials and services cost
Other external costs
Personnel costs
Depreciation of tangible and amortisation of intangible assets
9, 10, 11, 12, 23, 35
-861
-772
Other operating income
2, 35
25
2
Other operating expenses
3, 35
-61
0
Operating profit
1 068
546
Interest income and other financial items
6, 16, 28
70
178
Interest expense and other financial items
6, 16, 28
-1 077
-1 394
61
-670
7
-32
23
29
-647
-549
-966
-520
-1 613
23
-109
Profit/Loss after financial items
Tax
Profit/Loss for the period from continuing operations
Loss for the period from discontinued operations
25
Loss for the period
Other comprehensive income
Hedge effect in foreign investment
Exchange differences on translation of foreign operations
-180
830
-57
-235
17
71
Other comprehensive income for the period, net of tax
-197
557
Total comprehensive income for the period, net of tax
-717
-1 056
-578
-1 626
58
13
-520
-1 613
-772
-1 075
55
19
-717
-1 056
Revaluation reserve, cash flow hedging
Tax related to other comprehensive income
7
Profit attributable to:
Parent Company shareholders
Minority interests
8
Total comprehensive income attributable to:
Parent Company shareholders
Minority interests
Ygeia TopHolding AB
8
5 / 56
Consolidated statement of Financial position
Notes
2009-12-31
2008-12-31
9
10
6 249
3 709
9 958
6 474
3 975
10 449
Land and buildings
Equipment, tools, fixtures and fittings
Tangible fixed assets
12, 23
11, 23
6 143
1 561
7 704
6 443
1 602
8 045
Financial fixed assets, interest-bearing
Financial fixed assets, non-interest-bearing
Deferred income tax assets
Financial fixed assets
Total fixed assets
13, 16
13, 16
7
5
147
571
723
18 385
5
79
570
654
19 148
Inventories
Accounts receivable - trade
Other receivables
Current income tax assets
Prepaid expenses and accrued income
Short-term investments and interest-bearing receivables
Cash and cash equivalents
Assets attributable to discontinued operations
Total current assets
33
14
14
7
14, 17
16
16
25
249
2 244
468
0
203
34
518
3 716
227
1 825
214
30
186
11
444
8 850
11 787
22 101
30 935
26
8
2 262
283
2 545
3 210
268
3 478
Provisions for employee benefits, interest-bearing
Provisions, non-interest-bearing
Deferred income tax liabilities
Long-term liabilities, interest-bearing
Shareholder loans
Long-term liabilities, non-interest-bearing
Long-term liabilities, non-interest-bearing to group companies
Total long-term liabilities and provisions
5, 15
17, 18
7, 17
15, 16
15, 16
17
265
277
1 994
9 026
3 790
283
75
15 710
298
356
2 052
9 366
3 615
182
0
15 869
Interest-bearing current liabilities
Advance payments from customers
Accounts payable - trade
Other current liabilities
Current income tax liabilities
Accrued expenses and deferred income
Liabilities attributable to discontinued operations
Total current liabilities
15, 16
134
241
1 516
863
105
987
3 846
233
173
1 318
540
156
1 068
8 100
11 588
22 101
30 935
13 455
190
14 076
217
MSEK
Goodwill
Other intangible assets
Intangible assets
Total assets
Equity attributable to parent company shareholders
Equity attributable to minority
Total equity
7
17
25
Total liabilities, provisions and shareholders’ equity
Pledged assets
Contingent liabilities
Ygeia TopHolding AB
19
20
6 / 56
Consolidated statement of Cash flow
MSEK
Notes
Operating profit
Reversal of depreciations/amortisations and impairments
Items not affecting cash flow
Interest received
Interest paid
Taxes paid
Cash flow from operating activities before changes in working capital
Jan.-Dec. 2009 Jan.-Dec. 2008
1 068
858
31
33
-629
-33
1 328
546
760
19
107
-854
-1
577
Change in accounts receivable - trade
Change in other current receivables
Change in accounts payable - trade
Change in other current liabilities
Change in net working capital
-575
-286
157
425
-279
-202
-16
202
-94
-110
Cash flow from operating activities
1 049
467
Sale of fixed assets
Sale of companies being discontinued
Sale of companies
Aquisition of companies
Payment from minorities
Investments in fixed assets
Cash flow from investment activities
0
0
-77
14
-724
-787
1
-91
-162
-36
-705
-993
-27
123
-265
0
-169
25
427
-271
9
3
193
93
-333
Cash flow from operations being discontinued
Cash flow from operating activities
Cash flow from investment operations
Cash flow from financing operations
Cash flow from operations being discontinued
653
-354
-178
121
207
-830
831
208
Currency differences in cash and cash equivalents
Change in cash and cash equivalents
-38
176
122
-3
975
1 151
978
975
Of which closing balance, cash and cash equivalents in operations being discontinued
633
531
Closing balance, cash and cash equivalents in continuing operations
518
444
Increase in financial investments
Increase in external loans
Amortisation of external loans
Payment from minorities
New share issues and capital contributions
Cash flow from financing operations
Cash flow from continuing operations
Opening balance, cash and cash equivalents
Closing balance, cash and cash equivalents
Ygeia TopHolding AB
24
24
24
7 / 56
Consolidated statement of Change in equity
MSEK
Opening balance at 1 January 2008
Adjustment of the opening balance *)
Adjusted Opening balance at 1 January 2008
Profit for the period
Other comprehensive income
Total comprehensive income
Sale to minority
Acquired minority interest
Total transactions with shareholders
Closing balance at 31 Decemeber 2008
Other
Fair
value
Share contributed
capital
capital reserve
Retained
earnings
-1 173
-23
-1 196
179
179
4 492
-23
4 469
-1 626
13
6
19
-1 613
557
-1 056
56
9
65
3 478
54
5 326
73
33
54
5 326
73
33
0
-164
-164
715
715
0
ShareMinority holders'
interest equity
Translation
reserve
-1 626
-5
0
0
0
0
-5
61
9
70
54
5 326
-91
748
-2 827
268
*) This refers to an adjustment of incorrect book value (Building) of a finance lease in the local accounts of a subsidiary at the time of the Capio acquisition in 2006. Should this finance lease have been
correctly accounted for at the time of the Capio acquisition in 2006 the surplus value related to this asset would have been adjusted with the same amount. However, as the 12 month period past
acquisition elapsed this adjustment is accounted for as an error according to IAS 8.
MSEK
Opening balance at 1 January 2009
Profit for the year
Other comprehensive income
Total comprehensive income
Dividend
Distribution of operations being discontinued
Sales to minority interests
Transfer to minority interests
Total transactions with shareholders
Closing balance at 31 December 2009
Ygeia TopHolding AB
Other
Fair
value
Share contributed
capital
capital reserve
54
0
5 326
0
-91
-40
-40
ShareMinority holders'
interest equity
Translation
reserve
Retained
earnings
748
-2 827
268
3 478
-578
-578
58
-3
55
-520
-197
-717
-98
77
-19
-40
-1
-232
17
0
-216
283
2 545
-154
-154
0
0
0
0
-1
-134
-60
19
-176
54
5 326
-131
594
-3 581
8 / 56
Accounting principles
General information
Ygeia TopHolding AB, the Parent Company of the Group, is a limited liability company with its registered office
in Stockholm, Sweden. The company’s address is provided in Note 30. The company’s operations are described
in the Board of Directors’ Report on page 1.
The consolidated accounts for January to December 2009 were prepared in accordance with International
Financial Reporting Standards (IFRS) and the statements issued by the International Financial Reporting
Interpretations Committee (IFRIC) as adopted by the European Union. The Group also applies the Swedish
Financial Reporting Board’s Recommendation (RFR 1.2) "Supplementary Accounting Rules for Groups", which
specifies the disclosure requirements attributable to the Swedish Annual Accounts Act.
The consolidated accounts have been prepared in accordance with the cost method, except with regard to the
revaluation of financial instruments, which are continuously valued at fair value. Unless otherwise specified, all
amounts in the consolidated accounts are stated in millions of Swedish kronor (MSEK) and pertain to the period
from January to December 2009, in regard to income-statement items (the period from January to December
2008 for comparative periods), and to the amount on 31 December 2009 regarding balance-sheet items (on 31
December 2008 for comparative periods).
The preparation of financial statements in accordance with IFRS as adopted by the EU necessitates the use of a
number of accounting estimates. In addition, it requires management to make certain estimates when applying
the company’s accounting policies. Those areas that contain a high degree of accounting estimates, that are
complex or that are areas including assumptions and estimates are of key importance to the consolidated
accounts are described in Notes 5, 7 and 9.
Consolidated financial statements
The consolidated accounts include, in addition to the Parent Company Ygeia TopHolding AB, all companies in
which the Parent Company directly or indirectly held a controlling influence at year-end. A controlling influence
means that the Group owns participations corresponding to more than 50 per cent of the voting rights, or is
considered to control the company is some other way. The consolidated accounts are prepared in accordance
with the purchase method. As a result, only that portion of the shareholders’ equity of subsidiaries that has been
added after the acquisition is included in consolidated shareholders’ equity. Subsidiaries are included in the
consolidated accounts as of the date when the controlling influence is transferred to the Group, which normally
corresponds to the date of acquisition. Subsidiaries divested during the year are included in the consolidated
accounts until the date when the controlling influence ceases.
Historical cost is used for the reporting of the Group’s acquisition of subsidiaries. Acquisition cost for an
acquisition consists of the fair value of the assets provided as payment, equity instruments issued and liabilities
arising or assumed on the transfer date, plus any costs that are directly attributable to the acquisition. Identifiable
acquired assets and assumed liabilities and any contingent liabilities in a company acquisition are initially valued
at fair value on the date of acquisition, irrespective of the extent of any minority interests. The surplus that
consists of the difference between the acquisition cost and the fair value of the Group’s portion of identifiable
acquired net assets is reported as goodwill. If the cost is lower than the fair value of the acquired subsidiary’s net
assets, the difference is reported directly in the income statement.
All transactions with related parties are conducted at market value. Inter-company transactions, balance-sheet
items and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also
eliminated, unless the transaction constitutes proof that an impairment requirement exists for the transferred
asset. Where appropriate, the accounting policies for subsidiaries have been changed in order to guarantee the
consistent application of the Group’s accounting policies.
Associated companies are companies in which the Group has a significant but not controlling interest, which as a
rule corresponds to a holding of between 20 and 50 per cent of the voting rights. Holdings in associated
companies are reported in accordance with the equity method and are initially valued at acquisition cost. The
Group’s carrying amount of holdings in associated companies includes goodwill (net after any accumulated
impairment losses) identified at the time of acquisition.
The Group’s share in the results of an associated company after acquisition is reported in the income statement.
Accumulated changes following the acquisition are reported as changes in the carrying amount of the holding.
When the Group’s share in the losses of an associated company amount to, or exceed, the Group’s holding in the
associated company, including any unsecured receivables, the Group does not report further losses unless it has
undertaken commitments or made payments on behalf of the associated company.
Ygeia TopHolding AB
9 / 56
Translation of foreign currency
Items included in the financial reporting of the different Group companies are valued in the currency used in the
financial environment in which the individual companies are primarily active (functional currency). In the
consolidated accounts, Swedish kronor (SEK) is used, which is the Parent Company’s functional and reporting
currency. Transactions in foreign currencies are translated into the functional currency in accordance with the
exchange rates applying on the transaction date. Exchange rate gains and losses occurring from the payment of
such transactions and in the translation of monetary assets and liabilities in foreign currencies at the closing rate
are reported in the income statement. Exceptions are when transactions take the form of hedges that meet the
conditions for hedge accounting of cash flows or of net investments, whereby the gains/losses are reported in
other comprehensive income.
Group companies
The income and financial position of all Group companies (none of which have a high-inflation currency) with a
functional currency that is different to the reporting currency, are translated to the Group’s reporting currency in
accordance with the following:
i) assets and liabilities for each of the balance sheets are translated at the closing day rate;
ii) income and expenses for each of the income statements are translated at the average exchange rate, and;
iii) all exchange-rate differences that arise are reported as a separate component of other comprehensive income.
At the time of consolidation, exchange-rate differences arising as a result of the translation of net investments in
foreign operations, borrowing and other currency instruments, identified as hedges for such investments, are
carried to shareholders' equity through other comprehensive income. Upon divestment of a foreign operation,
such exchange rate differences are reported in the income statement as a part of capital gains/losses.
Goodwill and the adjustments of fair value arising in connection with the acquisition of foreign operations are
treated as assets and liabilities in the acquired operation and are translated at the closing day rate.
Tangible fixed assets
Tangible fixed assets are reported at historic acquisition cost, less accumulated depreciation according to plan
and accumulated impairments. Acquisition cost includes expenses directly attributable to the acquisition of the
asset. Depreciation is based on the original acquisition cost and is allocated straight line over the useful life of
the asset with consideration to estimated residual value. Additional expenses are added to the carrying amount of
the asset, or are reported as a separate asset, depending on which is appropriate, but only when it is probable that
the future financial advantages associated with the asset will accrue to the Group and the cost of the asset can be
assessed in a reliable manner. All other forms of repairs and maintenance are reported as costs in the income
statement during the period in which they arise.
The Group applies component depreciation of tangible fixed assets. This means that tangible fixed assets
consisting of different components, the cost of which is significant in relation to the total acquisition cost of the
assets, are depreciated separately. Depreciation according to plan is applied straight line over the useful life of
each asset, which is assessed on an annual basis. Generally, the following depreciation periods are applied in the
Group:
i) Buildings, 30-50 years
ii) Machinery and equipment, 3-10 years
iii) Computers and other hardware, 3-5 years
iv) Land is not depreciated
Machinery and equipment comprises predominantly hospital equipment such as beds, scanners, theatre
equipment and similar items.
If the asset’s reported value exceeds its estimated recoverable amount, the reported value of an asset is
immediately written down to the recoverable amount. Gains and losses on divestments are established by
comparing the proceeds from the sales with carrying amount and the result is then reported in the income
statement.
Intangible fixed assets
Intangible fixed assets are reported at cost, less accumulated amortisation according to plan. Intangible fixed
assets acquired as a result of acquisitions are reported at market value at the date of acquisition. Apart from
certain development expenses, the costs of internally generated intangible fixed assets are not capitalised but are
instead reported in the income statement as they arise. Following acquisition, intangible fixed assets are reported
in accordance with a limited useful life at original acquisition cost, less accumulated amortisation according to
plan and accumulated impairments. Amortisation is based on the original acquisition cost and is applied straightline over the useful life of the asset, which is assessed on an annual basis. Intangible fixed assets with an
unlimited useful life are subject to at least an annual impairment test, and as a result these assets are reported at
their original acquisition cost, less accumulated impairments.
Ygeia TopHolding AB
10 / 56
Goodwill consists of the amount by which the acquisition cost exceeds the fair value of the Group’s share of
identifiable net assets in the acquired subsidiary/associated company at the time of acquisition. Goodwill on the
acquisition of subsidiaries is reported as an intangible asset. Goodwill on the acquisition of associated companies
is included in the value of the holding in the associated company. Goodwill is assessed annually to identify
potential impairment needs and is recorded at acquisition cost less accumulated impairments. Gains or losses
arising on the disposal of a unit include the remaining carrying amount of the goodwill attributable to the
divested unit.
In the testing of potential impairment, goodwill is distributed between cash generating units. Each of these cash
generating units comprises the Group’s investments in each of the business areas in which operations are
conducted.
Intangible fixed assets in the form of key major trademarks, healthcare contracts, concessions and rights to use
premises below the prevailing market price have been valued at the market value established in conjunction with
company acquisitions. During subsequent periods, these assets are reported at original acquisition cost, less
accumulated amortisation according to plan and accumulated impairments. Such assets are amortised over an
estimated useful life of between 5 and 28 years. The majority of trademarks are assessed annually to identify
potential impairment and are reported at acquisition cost less accumulated impairments.
Acquired software licenses are capitalised on the basis of the costs arising when the software in question was
acquired and put into operation. These costs are amortised over the estimated useful life, which is normally three
to five years. Costs for the development or maintenance of software are expensed as they occur. Costs closely
related to the production of identifiable and unique software controlled by the Group, which will have probable
economic benefits for more than one year and which exceed the original cost, are reported as intangible assets.
Costs closely related to the production of software include personnel costs for the development of software and a
reasonable portion of attributable indirect expenses. Software development costs reported as assets are amortised
over their assessed useful life, which is normally three to ten years.
Impairment
Assets with an indefinite useful life, predominantly goodwill and trademark, are not amortised but tested
annually for potential impairments. Depreciated assets are assessed with regard to depletion in value whenever
events or altered conditions indicate that the carrying amount is perhaps not recoverable. An impairment is
recognised in the amount by which the carrying amount of the asset exceeds its recoverable value. The
recoverable value is the higher of an asset’s fair value, reduced by the sales costs, and value in use. When
conducting an impairment test, the assets are grouped at the lowest levels where separate identifiable cash flows
(cash generating units) exist. Future amortisation is adjusted to the written-down value.
Previously reported impairment losses are assessed on a continuous basis to establish if the events that served as
a basis for such impairment still exist, or if they have changed. In the event of significant changes, the
recoverable amount is estimated. A reversal is made to an earlier reported impairment only if there is a change in
the assumption upon which the original impairment was based. Possible reversals are reported in the income
statement with an amount corresponding to the estimated recoverable amount adjusted for amortisation as if the
original impairment had not been reported, except for goodwill, for which impairments are not reversed.
Assets held for sale and operations being discontinued
The Group classifies a fixed asset or disposal group as assets held for sale if their reported value will largely be
recovered through a sale. To be classified as an asset held for sale, the asset or disposal group must be available
for immediate sale in its current condition. It must also be highly probable that a sale will occur.
The classification of operations as discontinuing operations is made at the time of sale or at an earlier juncture
when the operations fulfil the criteria for classification as an asset held for sale, such as the sale of a business
area or having the clear intention of distributing a business area. A disposal group planned to be discontinued
also fulfils the criteria.
Immediately prior to classification as an asset held for sale, the reported value of the assets, and all assets and
liabilities in a disposal group, are determined in accordance with applicable IFRS standards. At the time of initial
classification as an asset held for sale, fixed assets and disposal groups are reported at the lowest carrying
amount less selling expenses. Depreciation/amortisation is not applied in cases of assets held for sale.
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Financial instruments
Financial assets and liabilities are according to IAS 39 categorised as either:
Financial assets
i) Financial assets at fair value through the income statement
ii) Loans and receivables
iii) Held to maturity investments
iv) Available for sale financial investments
Financial liabilities
i) Financial liabilities at fair value through the income statement
ii) Financial liabilities valued at amortised cost.
Within each category there are different classes of financial instruments. Used classification is evaluated at the
end of each financial year, and is modified if necessary.
All financial instruments are initially valued at their fair value and accounted for at their trade date. Potential
transaction costs are included except when the assets and liabilities are categorised as fair value through income
statement. Transaction costs that arise in conjunction with the assumption of financial liabilities are amortised
throughout the duration of the loan as a financial expense. Fair values of assets are market values if those exist.
If there is no market for an asset different valuation techniques are used. A financial asset is derecognised when
essentially all risks and rewards connected to the asset has been transferred to an external party.
Embedded derivatives are separated from their host contracts. These contracts are valued at fair value through
income statement if their inherent risks are closely related to the embedded derivative.
Financial assets at fair value through the income statement
A financial asset at fair value through the income statement is either one (1) traded with or (2) it has initially
been classified at fair value through the income statement according to the fair value option. For an asset to be
classified as (1), it has to be bought with an intention of selling it within the near future. It also has to be a part
of a portfolio that is managed as one and finally there has to be a pattern of short term realisations.
Derivatives, including embedded derivatives separated from their host contracts, are classified as held for
trading. Changes in their fair values are accounted for in the income statement.
The Group is using interest rate swaps, floors and caps. When they are a part of a documented, efficient swap
hedge accounting is used. Changes in the hedging instruments values are accounted for within other
comprehensive income (other reserves) and the income statement, see below. Besides these assets there are no
financial assets accounted for at fair value through the income statement.
Financial assets held to maturity
Financial assets held to maturity are non derivative financial assets with fixed or determinable payments and
fixed maturities.
The Group do not possess any financial assets held to maturity.
Loans and receivables
Loans and receivables are non derivatives financial assets with fixed or determinable payments. These assets are
not quoted in an active market and the company do not trade them. Loans and receivables are initially accounted
for at their fair value, which is the value the company can expect to receive. If the credit time exceeds one year
the receivable will be accounted for at its present value. Allowances are made for uncertain receivables every
year when there are evidence concluding the fact that the company will not receive any payments. After initial
valuation, loans and receivables are carried at amortised using the effective interest method less any allowance
for impairment. Gains and losses are recognised in the income statement when the loans and receivables are
derecognised or impaired, as well as through the amortisation process.
Information regarding loans and receivables is presented in the notes 15 and 16. Information regarding loans and
receivables inherent credit risk is described according to IFRS 7. There is no concentration of credit risk.
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Available for sale financial investments
This category includes assets that are not categorised as any of the other three categories. These assets are
initially valued at their fair value with changes accounted for in other comprehensive income. When the assets
are sold, any cumulative valuation effects accounted for within equity are recycled through the income statement
when the asset is sold or disposed of in another way. Earned and paid interests on these assets are accounted for
through the income statement as a financial transaction according to the effective interest method. Dividends
received on these assets are accounted for in the income statement.
Short-term investments are classified as available for sale financial investments and changes in their fair values
are accounted for in the statement of other comprehensive income. Short-term investments mainly consist of
interest bearing instruments and are presented in note 16.
Financial liabilities at fair value through the income statement
The category includes financial liabilities held for trading, which is the case if they are acquired for the purpose
of selling in the near future. Derivatives, including separated embedded derivatives, are also classified as held
for trading unless they are part of an effective hedge. Gains or losses on liabilities held for trading are recognised
in the income statement, if they do not form a part of an efficient hedge.
Interest bearing loans and borrowings
All loans and borrowings are initially recognised at fair value less directly attributable transaction costs, and
have not been designated at fair value through income statement. After initial recognition, interest bearing loans
and borrowings are subsequently measured at amortised cost using the effective interest method.
The Group possess interest bearing loans and borrowings. These liabilities are accounted for in note 15 and 16.
Impairment of financial assets
Impairment testing is performed for individual assets. If this is not possible assets are grouped into cash
generating units and the risk for impairment is then assessed collectively. Individually impaired assets or assets
impaired during earlier periods are not included in the collective testing.
Assets valued at amortised cost
When there is evidence that assets valued at amortised cost, such as loans and receivables, have declined in
value, an impairment loss is recognised in the income statement. The impairment loss comprises the difference
between the carrying amount and the present value of the estimated future payment flow attributable to the
individual asset. The discounting of future cash flows is conducted based on the effective interest rate initially
used.
If the prerequisites for an impairment loss performed no longer appear exist, and this can be related to an event
that occurred after the impairment was conducted, the impairment loss is reversed in the income statement on
the condition that the carrying amount does not exceed the amortised cost at the time of reversal.
Available for sale financial investments
If an asset available for sale is impaired the difference between its cost and its current fair value, less any
impairment loss previously recognised in income statement, is transferred from equity to income statement.
Reversals in respect of equity instruments classified as available for sale are not recognised in income statement.
Reversals of impairment losses on debt instrument are reversed through income statement.
Hedge accounting
Hedges are either classified as a fair value hedge, a cash flow hedge or a hedge of a net investment of a foreign
operation.
i) Fair value hedges are used to hedge exposures to changes in assets' and liabilities' fair value or against a not
recognised financial commitment.
ii) Cash flow hedges are used to hedge an exposure to variability in future cash flows that is either attributable to
a particular risk associated with a recognised asset or liability (for instance a loan with variable interest) or a
highly probable forecast transaction or the foreign currency risk in an unrecognised firm commitment. In terms
of cash flow hedging the effective part is accounted for directly in the statement of other comprehensive income
and the ineffective part is accounted for in the income statement.
iii) Hedges of a net investment in a foreign operation.
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In order to use hedge accounting the company has to fulfill certain requirements described in IAS 39 regarding
documentation of the hedge relationship. The hedged position has to be identified and described, the purpose of
the hedge has to be described and the company has to confirm the effectiveness of the hedge. Financial
instruments used for the purpose of securing future cash flows denominated in foreign currency are considered a
hedge if the future cash flows are highly probable. When a hedging instrument expires, is sold or when the
hedging requirements are no longer met accumulated gains and losses are recycled to the income statement. If
the future transaction no longer is expected to be realised accumulated gains and losses are recycled in the same
way. The Group uses financial derivatives such as forwards and swaps to hedge interest rate risks.
Inventories
Inventories are valued at the lower of acquisition cost and net realisable value. The necessary obsolescence
provisions have been made. Cost is calculated according to the first in/ first out (FIFO) principle. The net
realisable value is the estimated value in the operational activities.
Accounts receivables - trade
Accounts receivable are valued at fair value less possible provisions for reductions in value. A provision for
reduction in the value of an account receivable is made when there is objective evidence that the Group will not
be able to secure all amounts maturing in accordance with the original conditions of the receivable. The sise of
the provision comprises the difference between the carrying amount of the asset and the current value of
estimated future cash flows, discounted by the effective interest rate. The reserved amount is reported in the
income statement.
Cash and cash equivalents
Cash and cash equivalents consist of cash, bank balances and other short-term investments with a maturity of
less than three months, and bank overdraft facilities. The bank overdraft facility is reported in the balance sheet
as borrowing among interest-bearing current liabilities.
Share capital
Common and preferential shares are classified as shareholders’ equity. Transaction costs directly attributable to
the issue of new shares or options are reported net, after tax, in shareholders’ equity as a deduction from the
issue proceeds.
Borrowing
Borrowing is initially reported at fair value, net after transaction costs and subsequently at accrued acquisition
cost. Any difference between the amount received (net after transaction costs) and the amount to be repaid is
reported in the income statement, distributed across the loan period by applying the effective interest method.
Borrowings are classified as current liabilities, unless the Group has an unconditional right to defer payment of
the debt for at least 12 months following the reporting date.
Account payables - trade
Accounts payable are initially reported at nominal values, which are assumed to correspond with fair values.
Provisions
Provisions for restructuring expenses and legal requirements are reported when the Group has a legal or informal
obligation resulting from past events and it is highly probable that an outflow of resources will be required to
meet the obligation and that the amount has been calculated in a reliable manner. The provision for restructuring
mainly covers one-time costs relating to severance pay. No provisions are made for future operating losses.
If a number of similar obligations exist, an assessment is made of the probability that these could result in an
outflow of resources to meet the entire group of obligations. A provision is reported even if the probability of an
outflow related to a specific item in this group of obligations is negligible.
Employee benefits
Pension obligations
The Group companies have a number of different pension plans. The plans are normally financed through
payments to insurance companies or externally managed funds in accordance with periodic actuarial
computations. The Group has both defined benefit pension plans and defined contribution pension plans. A
defined benefit plan is a pension plan that stipulates the amount of the pension benefit an employee will receive
after retirement based on such factors as age, period of service and salary. A defined contribution pension plan is
one according to which the Group pays fixed fees to a separate legal entity. The Group has no legal or informal
obligation to pay additional fees if the fund does not have sufficient assets to pay all benefits due to employees in
connection with their periods of service during the current period or earlier periods.
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Provisions, with regard to any plan assets for obligations related to post employment benefits, arise when the
obligations are defined benefit obligations. In regard to employment during the current period, these liabilities
and costs are computed on an actuarial basis using the Projected Unit Credit Method. The computations are
made on an annual basis for the Group’s largest plans and regularly, but less frequently, for other plans. The
computations are based on external actuarial assumptions. The assumptions used to compute the pension
obligation and costs vary in accordance with the economic factors reflecting the situation in those countries
where the defined benefit plans are located.
The Group’s defined benefit plans are either non-funded or funded. In the case of non-funded plans, the benefits
are paid out of the assets from the companies included in the plan. The provision in the balance sheet is made up
of the present value of the defined benefit obligation adjusted for unrecognised actuarial gains and losses plus
unrecognised costs for service during earlier periods. In the case of funded pension plans, the assets belonging to
the plan are held separately from the Group’s assets in externally managed funds. Liabilities or assets shown in
the balance sheet with regard to funded pension plans represent the amount by which the market value of the
plan assets exceeds or falls below the present value of the defined benefit obligation, adjusted for unrecognised
actuarial gains/losses and cost of employment service during earlier periods. However, a net asset is reported
only to the extent that it represents a possible future financial benefit for the Group, for example in the form of
reduced future fees, or the repayment of funds accumulated in the plan. When such surpluses are impossible to
utilise, they are not reported but are instead explained in a note to the financial statements.
Actuarial gains/losses arise principally when changes occur in the actuarial assumptions and when differences
occur between actuarial assumptions and actual outcome. That portion of the accumulated amount that exceeds
10 per cent of the larger of the pension obligations’ present value and the market value of the plan assets at the
end of the preceding year is reported among earnings over the average remaining period of service of employees
participating in the plan, that is, in accordance with the corridor principle. For all defined benefit plans, the
actuarial costs, which is charged against earnings, consist of the cost of employment service during the current
period, interest expense, the anticipated return on the plan assets (funded plans only), the costs related to earlier
periods of employment service and any amortisation of actuarial gains or losses. The costs of employment
service during earlier periods and which relate to changed pension conditions are realised when these
improvements have become vested benefits or have been amortised during the period up until this occurs.
The accounting principles described above for defined benefit pension plans are applied only in the consolidated
accounts. The Parent Company and subsidiaries continue to apply local computations in regard to pension
provisions and pension costs in their annual accounts.
Certain Group companies have defined contribution pension plans, which refer to benefits paid to employees
after the completion of service, and for which the Group has no obligation to pay benefits after premiums have
been paid to the third party responsible for the plan. Such plans are reported as a cost as premiums are paid.
Some of the ITP plans in Sweden are financed through insurance premiums paid to Alecta, which is a multiemployer plan. At the present time, Alecta is unable to provide the information required to report the plans as
defined-benefit plans. As a result, the ITP plans insured via Alecta are reported as defined contribution pension
plans.
Compensation is paid if employment is terminated prior to normal pension age, or when an employee accepts
voluntary termination in exchange for compensation. The Group reports severance pay when it is demonstrably
obligated to either terminate employees in accordance with a detailed formal plan, without any possibility of
recall, or to pay compensation upon termination as a result of an offer made to encourage voluntary termination.
Benefits that mature after more than 12 months from the reporting date are discounted to present value.
Revenue recognition
Although the Group applies various compensation models in the markets in which it is active, they all have a
common denominator, namely that revenues are recognised at the time the services are performed in all markets.
The Group applies the percentage-of-completion method, which means that revenues from assignments are
reported in accordance with the degree of completion on the reporting date. Revenues from the sale of services
are recognised in the reporting period when the work is performed. Only revenues that provide the Group with
economic benefits are recognised. In the consolidated accounts, inter-company sales are eliminated.
Borrowing costs
Financial items are recognised in the income statement in the period in which they arise. Exceptions include the
interest arising during the installation period, or similar items, which are capitalised, plus costs arising in
connection with the raising of loans, which are distributed over the duration of the loan. Capitalised loan
expenses are reported in the balance sheet as a reduction of the underlying loan obligation.
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Leasing
A lease contract in which the financial risks and rewards associated with the ownership of an asset are essentially
transferred to the Group is defined as a financial lease contract. Financial lease contracts are reported as fixed
assets initially entered at the discounted present value of future leasing fees during the lease period or the market
value, whichever is the lower. Assets that are utilised through financial lease contracts are reported in the
balance sheet as tangible fixed assets and are depreciated in accordance with the principles for owned tangible
fixed assets. Related commitments are reported as interest-bearing liabilities. Lease fees are distributed between
interest and amortisation of debt. Interest is distributed over the lease period so that each accounting period is
charged with an amount corresponding to a fixed interest rate on the reported liability in each period. Financial
lease contracts are depreciated in accordance with the principles applied for owned tangible fixed assets. For
other lease contracts, the annual leasing cost is reported as an operating expense in the income statement.
Taxes
Taxes consist of current income tax based on taxable earnings, deferred income tax and other taxes, such as tax
on returns, and adjustments to current income tax in regard to earlier years for the Group’s subsidiaries and
associated companies. All Group companies calculate their income taxes in accordance with the applicable tax
laws in the countries in which they are active. Unless attributed to an underlying transaction that has been
reported in the statement of other comprehensive income, income tax is reported directly in the income
statement.
The Group applies the balance sheet method to recognise deferred income tax liabilities and assets. The balance
sheet method means that calculations are based on the tax rate applying on the reporting date, which is applied to
differences between the booked and income tax values of assets and liabilities and to loss-carry-forwards. Losscarry-forwards can be utilised to reduce future taxable income. Deferred income tax assets are reported to the
extent that it is probable that future taxable revenue will be available to enable the utilisation of such benefits.
Other taxes relate to taxes that do not have the nature of income taxes and these are reported elsewhere in the
income statement.
Government grants
Government grants related to investments reduces the acquisition cost of the asset in question. Government
grants related to current expenses, such as training and similar items, is reported as a reduction in the cost of
implementing the activity in question.
Divestment of minority
The effect from divesting a minority can either be accounted for in the income statement or directly as a change
in equity. The Group applies the principle to account for such divestments as a change in equity.
Key estimates and assessments
In preparing the report, certain accounting methods and accounting principles must be used, the application of
which may be based on difficult, complex and subjective judgements on the part of company management, or on
previous experience or assumptions judged in the light of circumstances to be reasonable and realistic. The use
of such estimates and assumptions influences the reported amounts for assets and liabilities as well as
disclosures regarding contingent assets and liabilities at the reporting date and reported net sales and expenses
for the period. Actual outcomes based on other assumptions and under other circumstances may differ from
these assessments. The following is a summary of the accounting principles whose application requires extensive
subjective judgements on the part of company management with regard to estimates and assumptions that by
their nature are difficult to assess.
Impairment of assets
The values of goodwill and brands are subject to impairment tests annually, or whenever events or changes occur
that indicate that the carrying amount of an asset may not be recoverable. For other fixed assets, the value is
tested when events or changes occur that indicate that the carrying amount of an asset may not be reclaimable.
Impairment losses are taken with respect to assets that have declined in value, down to their market value based
on the best available information. Various bases for assessment have been used depending on access to
information. Where market values can be established, they have been used and the impairment amount has been
reported where there is an indication that the carrying amount for an asset cannot be recovered. In certain cases,
it has been impossible to establish the market value and an estimate of fair value has been made by computing
the present value of cash flow based on expected future outcomes. Differences in estimates of expected future
outcomes and discount interest rates used may result in discrepancies in the valuation of assets.
Fixed assets, with the exception of goodwill and intangible assets with indefinite useful lives, are amortised
straight-line over their estimated useful lives.
Company management performs regular revaluations of the useful lives of all assets of key significance. It is the
understanding of company management that reasonable changes in the factors that constitute the basis for
estimation of the recoverable value of assets should not lead to the reported value exceeding the recoverable
value.
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Deferred income taxes
In preparing the financial reports, the Group calculates the relevant income tax for each tax jurisdiction in which
the Group operates, as well as the deferred income taxes attributable to temporary differences. Deferred income
tax assets that are primarily attributable to tax loss-carry-forwards and temporary differences are reported if the
deferred tax assets can be expected to be recoverable through future taxable income. Changes in assumptions
about forecasted future taxable income, as well as changes in tax rates, may result in significant differences in
the valuation of deferred income taxes.
Accounts receivables - trade
Receivables are reported net, after allowing for doubtful receivables. The net value reflects amounts expected to
be recoverable based on circumstances known on the reporting date. Changed circumstances, for example, an
increase in defaulted payments or change in the financial position of a major customer, may entail significant
discrepancies in valuation.
Compensation following completion of employment
The Group has defined benefit pension plans for a portion of its employees in certain countries. Computation of
pension costs is based on assumptions regarding the expected yield of managed assets, the discount interest rate
and future salary increases. Changed assumptions directly impact costs for work performed during the current
period, interest expenses and expected yield from managed assets. Profit or loss, which arises when the actual
yield from managed assets deviates from the expected and actuarially computed obligations are adjusted on the
basis of empirically induced changes to assumptions, is distributed over the expected average remaining
employment terms in accordance with the so called corridor model.
Legal disputes
The Group is involved in legal disputes in the normal course of business operations. Such disputes can prove to
be costly and time-consuming and can disrupt normal operations. In addition, the outcome of complicated
disputes is difficult to predict. The possibility cannot be excluded that a disadvantageous outcome of a dispute
may prove to have a significant negative impact on the Group’s profits and financial position.
New accounting principles for the Group as of 1 January 2009
IASB has issued some new standards and interpretations, as well as amendments to standards and interpretations
valid from 1 January 2009.
New standards, amendments or interpretations affecting the financial statements or performance of the Group
IAS 1
The revised standard requires a separation between changes in equity due to transactions with owners and nonowners respectively. Only details of transactions with owners are included in the consolidated statement of
changes in equity. The standard introduces a statement of comprehensive income where all items of recognised
income and expense are presented. In the standard there is an option to either present one single statement, or
two linked statements. The Group has elected to present one statement.
During the year the Group has changed from reporting a cost based income statement to a functional income
statement in the internal operational reporting. This has e.g. implied that parts of income and cost previously
reported as Other operating income and Other operating expenses are now reported as Net sales and Other
external cost respectively. Part of costs previously included in Direct materials and services costs are now
reported as Other external cost. Please refer to Note 35 for additional effects of the change to a functional
income statement.
New standards, amendments or interpretations not deemed to have an impact on the financial statements or
performance of the Group in the present situation
IAS 23
Amendment handling capitalisation of borrowing costs that are directly attributable to purchase, construction or
production of an asset that takes considerable time to complete for the intended use or sale. With the
introduction of the revised IAS 23, it is no longer possible to choose whether borrowing costs are capitalised or
not. Instead, capitalisation is mandatory. The recommendation have not had any effect on the Group’s earnings
or financial position as the Group's policy has been to capitalise such borrowing costs.
IAS 27
The amendments to IAS 27 requires all dividends from a subsidiary, jointly controlled entity or associate to be
recognised in the income statement in the separate financial statement.
IAS 32
Amendment that specifies the requirements of disclosures for puttable instruments and obligations arising on
their liquidiation. The amendments have not had any impact on the Group's financial position or performance as
the Group in the present situation does not hold such instruments or obligations.
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IFRS 2
Amendment that clarifies the vesting conditions and cancellations for share based payments. The amendment has
not had an impact on the financial position of the Group as the Group has no share-based payment transactions.
IFRS 7
Additional disclosure requirements regarding financal instruments accounted for at fair value in the balance
sheet.
IFRS 8
IFRS 8 contains additional disclosure requirements with respect to financial and descriptive information
pertaining to operating segments. With the introduction of IFRS 8, IAS 14 Segment Report was replaced. The
recommendation has as of today had limited effects on the Group’s reporting as the Group is not required to
present segment reporting.
IFRIC 13
This interpretation applies to companies that use, for example, loyalty points and similar arrangements and has
no impact on the Group.
IFRIC 16
This standard clarifies the nature of the hedged risk (net investment in a foreign operation), the amount for
which a hedging relation can be designated, which entity in the group that can hold the hedging instrument and
what to do when the foreign operation is divested.
IFRIC 18
This standard clarifies the accounting when assets (cash or otherwise) are received from customers.
New accounting principles for the Group as of 1 January 2010 and onward
IASB has issued a number of new standards and interpretations, as well as amendments to standards and
interpretations that must be applied by the Group as of 1 January 2010 and subsequently.
New standards, amendments or interpretations affecting the financial statements or performance of the Group
IFRS 3
Amendment to the standard with the main changes being handling of acquisition costs, contingent
considerations, measurement of goodwill and measurement of income tax losses. These changes applies from 1
January 2010 and will affect the Group's earnings and financial position to the extent acquistions are completed.
IAS 27
The amended IAS 27 requires that a change in the ownership interest of a subsidiary (without loss of control) is
accounted for as a transaction with owners in the consolidated statement of changes in equity. Such transactions
will no longer give rise to change in goodwill, nor an effect in the income statement. The changes will affect the
Group's accounting for future transactions with non-controlling interest.
IFRIC 12
Service Concession Arrangements. This statement applies to arrangements in which a private company will
create infrastructure for providing public service for a specific period of time. The company may charge for this
service during the contract period. The interpretative statement applies as of 1 January 2008 but was not
approved by EU until March 2009 and will be effective for the Group from 1 January 2010.
The Group has one contract with a public authority that will be evaluated based on IFRIC 12 during 2010. Main
effect from this analysis is expected to be a reclassification from tangible fixed assets to intangible/financial
fixed assets.
New standards, amendments or interpretations not deemed to have an impact on the financial statements or
performance of the Group in the present situation
IFRS 2
The amended standard addesses how to account for a situation where a business receives goods and services for
which another business within the group has a commitment.
IFRS 9
A first step in the amendment of IAS 39. The standard implies a reduction in the number of valuation categories
for financial assets. The main valuation categories will be historical cost and fair value through the income
statement respectively. The standard is not yet approved by the European Union and applies from 1 January
2013. As the standard is not final the Group has not evaluated possible effects of the new standard.
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IAS 24
Definition of related parties has changed. The amendment is not yet approved by the European Union.
IAS 32
Changed definition of debt, which e.g. implies that subscription rights in another currency than the functional
currency will be an equity instrument when issued prop rata to existing owners. The standard is not yet approved
by the European Union.
IAS 39
Amendment that clarifies which part of an option that can be designated as effective as a hedging instrument for
hedge accounting and it also clarifies when inflation can be identified as a hedged risk. Amendment applies from
1 January 2010.
IFRIC 14
IFRIC 14 (IAS 19 The limit on a defined benefit asset, minimum funding requirements and their interaction)
addresses whether refunds or reductions in future contributions should be regarded as available, how a minimum
funding requirement might affect the change in future contributions and when a minimum funding requirement
might give rise to a liability in the accounts. The standard is not yet approved by the European Union.
IFRIC 15
This standard specify principles for revenue recognition for real estate developers.
IFRIC 17
This standard clarifies the accounting when non cash assets are distributed to owners. This standard applies from
1 January 2010.
IFRIC 19
The standard clarifies accounting of when financial liabilities are estinguished with equity instruments through
an agreement with a lender. The standard is not yet approved by the European Union.
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Note 1: Distribution of net sales
Sweden
Spain
France
Germany
Norway
UK
Other
Total
Jan.-Dec.
2009
3 214
5 600
5 095
1 180
521
117
1
15 728
Jan.-Dec.
2008
2 455
4 347
4 463
976
473
131
4
12 849
Jan.-Dec.
2009
15
7
3
0
25
Jan.-Dec.
2008
0
2
0
2
Jan.-Dec.
2009
-43
-13
-5
-61
Jan.-Dec.
2008
0
0
Note 2: Other operating income
Other operating income
Insurance compensation
Sale of companies
Sale of fixed assets
Other
Total
Note 3: Other operating expenses
Other operating expenses
Sale of companies
Insurance related costs
Other
Total
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Note 4: Salaries, other compensation and social costs
Jan.-Dec. 2009
Group
Parent company
Salaries and
other compensation
5 660
-
Salaries and other compensation Jan.-Dec. 2009
Board and President
Sweden
15
Spain
73
France
28
Norway
4
Germany
9
UK
9
Group total
138
Parent company, Sweden
Parent company total
Social security
expenses
1 875
(of which
bonus)
5
0
4
0
2
3
14
-
Pension
costs
156
-
Jan.-Dec. 2008
Other
employees
1 259
1 953
1 525
177
532
76
5 522
-
Salaries and
other compensation
4 383
-
Social security
expenses
1 560
-
Total
1 274
2 026
1 553
181
541
85
5 660
Jan.-Dec. 2008
and President
22
63
22
14
5
0
127
(of which
bonus)
1
2
2
1
0
0
6
Other
employees
895
1 502
1 365
139
292
63
4 256
Total
917
1 565
1 387
153
297
63
4 383
-
-
-
-
-
-
Pension
costs
109
-
Ygeia TopHolding's board consists of eight people, all of them are men. No board fees are paid.
Average number of employees
Per country
Sweden
Spain
France
Norway
Germany
UK
Group total
Parent company, Sweden
Parent company total
Ygeia TopHolding AB
Jan.-Dec. 2009
Jan.-Dec. 2008
Number of
employees
3 204
6 307
5 140
370
1 107
160
16 288
Of whom
women
2 572
4 642
4 520
264
863
106
12 967
Of whom
men
632
1 665
620
106
244
54
3 321
Number of
employees
2 605
5 183
5 093
300
1 307
153
14 641
Of whom
women
2 077
4 073
4 473
224
960
98
11 905
Of whom
men
528
1 110
620
76
347
55
2 736
-
-
-
-
-
-
21 / 56
Note 5: Pensions
Most of the employees within Capio are covered by pension plans. Such plans can be either defined-benefit plans or defined-contribution plans. The pensions are normally
secured through insurance premiums and primarily involve retirement pensions. Pension commitments are calculated on an annual basis, as per the closing date and in
accordance with actuarial principles. Plan assets for the securing of pension commitments are valued at market value. In cases where the accumulated actuarial gain or loss on
pension commitments and plan assets exceeds a corridor corresponding to 10 per cent of the higher of either of the pension commitments or the plan assets, the excess amount
is recognised as income during the employee’s remaining period of employment. In Sweden, most pension commitments are secured through plans that comprise a number of
employers. The largest of these is the ITP plan administered by Alecta. In December 2009 a defined benefit plan in Norway was changed to a defined contribution plan. The
change was accounted for as a settlement in the accounts with a net positive effect in the income statement with 23 MSEK which was reported in personnel cost.
Information about reporting in connection with Alecta
This is a defined-benefit multi-employer plan. The company has not had access to such information as would enable reporting of this plan as a defined-benefit plan. Pension
plans according to ITP that are secured through insurance via Alecta are accordingly reported as defined-contribution plans. Alecta’s surplus can be distributed to the policy
holders and/or to the insured. At the end of 2009, Alecta’s surplus in terms of the collective consolidation rate was 141 % (112). The collective consolidation rate consists of
the market value of Alecta's assets expressed as a percentage of insurance commitments calculated in accordance with Alecta's actuarial assumptions.
31 Dec. 2009
Current value of commitments
Fair value of plan assets
Unrecognised actuarial profits (+) and losses (-)
Net balance sheet liability
Pension commitments
Opening balance
Reclassification to operations being discontinued
Service costs - benefits accrued during the year
Interest expenses
Contributed funds from employer
Paid benefits
Actuarial gains (+)/losses (-)
Liabilities extinguished on settlement
Other
Exchange-rate differences
Closing balance
Plan assets
Opening balance
Reclassification to operations being discontinued
Assets aquired through company aquisitions
Expected return on plan assets
Contributed funds from employer
Paid funds
Assets distributed on settlements
Difference between actual and expected return on plan assets
Exchange-rate differences
Closing balance
Net liability
Funded
pension plans
322
-248
-32
42
31 Dec. 2008
Unfunded
pension plans
174
-2
51
223
Total
496
-250
19
265
350
32
15
-4
20
-107
0
16
322
198
13
10
-2
-24
-11
0
-10
174
31 Dec. 2009
548
45
25
-6
-4
-118
0
6
496
258
13
42
-4
-76
2
13
248
3
-1
2
31 Dec. 2009
261
13
42
-5
-76
2
13
250
74
172
246
Funded
pension plans
350
-258
-22
70
Unfunded
pension plans
198
-3
33
228
Total
548
-261
11
298
768
-448
24
14
0
-3
5
0
0
-10
350
192
-11
4
8
-8
-3
-9
0
-2
26
198
31 Dec. 2008
960
-459
28
22
-8
-6
-4
0
-2
16
548
676
-443
0
12
29
-3
0
-3
-10
258
0
0
4
0
0
-1
0
0
0
3
31 Dec. 2008
676
-443
4
12
29
-4
0
-3
-10
261
92
195
Jan.-Dec. 2009
Total pension expenses for pension plans
Benefits accrued during the year
Expected return on plan assets
Other costs
Pensions costs, defined-benefit plans
Pension premiums for defined-compensation and direct pensions
Pension costs, excluding interest
Interest on pension provisions
Total pension costs
Actuarial assumptions, %
Discount interest rate
Inflation
Expected salary increases
Yield on managed assets
Funded
pension plans
32
-13
0
19
19
14
33
Unfunded
pension plans
13
-1
0
12
121
133
9
142
288
Jan.-Dec. 2008
Total
45
-14
0
31
121
152
23
175
Funded
pension plans
24
-12
1
13
13
14
27
Unfunded
pension plans
4
0
0
4
74
78
16
94
Total
28
-12
1
17
74
91
30
121
2008
5,1%
2,4%
4,0%
5,1%
2009
4,3%
1,9%
3,1%
4,6%
The discount interest rate reflects the interest level at which pension commitments can be redeemed in full. The yield from managed assets reflects expected average yield. This
level varies with the type of placement and market. Expected salary increases are dependent on inflation, seniority and advancement. Assessments are based on historical
information.
Specification of plan assets per investment category
Equities
Bonds
Other
Total
Ygeia TopHolding AB
31 Dec. 2009
56
162
30
248
22,4%
65,4%
12,2%
100,0%
31 Dec. 2008
42
190
26
258
16,3%
73,6%
10,1%
100,0%
22 / 56
Note 6: Financial items
Dividends
Exchange-rate differences
Interest income
Other financial income
Total financial income
Interest expenses
Interest expenses, shareholder loans
Exchange-rate differences
Other financial expenses
Total financial expenses
Jan.-Dec. Jan.-Dec.
2009
2008
1
2
38
54
29
122
2
0
70
178
-555
-456
0
-66
-1 077
-755
-387
-130
-122
-1 394
Note 7: Income tax
Tax expense for the year divided among current and deferred tax:
Current tax
Deferred tax
Tax expenses
Jan.-Dec. Jan.-Dec.
2009
2008
-3
-75
-29
97
-32
23
Estimated tax on profit for the year in Sweden has been calculated at 26.3 %. Tax for other countries has been calculated
in accordance with the tax rates in use locally.
Jan.-Dec. 2009
Jan.-Dec. 2008
Earnings from continuing operations
29
-647
-966
Earnings from discontinued operations
-549
Total
-520
-1 613
The primary differences between the statutory corporate tax in Sweden and the effective tax for the Group were:
Origin of reported tax costs
Profit/Loss before tax
Tax calculated at Swedish tax rate of 26.3%
Difference between new tax 26.3 % rate in Sweden as from 1 Jan 2009
Difference between tax rate in Sweden and abroad
Adjustment of current tax from earlier periods
Tax related to non-deductible items
Changed valuation of temporary differences*
Tax related to internal transactions with companies held for sale
Other
Reported tax expense
Jan.-Dec.
2009
%
Jan.-Dec.
2008
%
61
-16
0
-15
48
-25
-62
0
38
-32
26%
0%
25%
-79%
41%
102%
0%
-62%
52%
-670
187
10
-3
-2
-9
-189
0
29
23
28%
1%
0%
0%
-1%
-28%
0%
4%
3%
In addition to the tax expense for the year reported in the income statement, deferred income tax of 17 MSEK (60) were recognised
in other comprehensive income for the year. A significant part of the deferred tax recognised in other comprehensive income is
attributable to aquisition related deferred tax. There were no significant changes in income tax rates during the period.
* Of which 62 MSEK relate to income tax losses not recognised in 2009.
Ygeia TopHolding AB
23 / 56
Note 7 (cont): Income tax
Deferred tax assets attributable to the following temporary differences and
losses carried forward:
Deferred tax assets attributable to:
Temporary differences, fixed assets
Temporary differences, long-term financial assets
Temporary differences, current assets
Deductible temporary differences, provisions
Losses carried forward
Other deductible temporary differences
Deferred tax assets, gross
Valuation allowance
Deferred tax assets, net
31 Dec.
2009
31 Dec.
2008
296
103
13
53
429
75
969
-398
571
290
84
2
48
587
49
1 060
-490
570
Deferred tax liabilities attributable to the following temporary differences
and losses carried forward:
Deferred tax liabilities attributable to:
Temporary differences, fixed assets
Deductible temporary differences, provisions
Deferred tax on untaxed reserves
Other deductible temporary differences
Other taxable temporary differences
Deferred tax liabilities
31 Dec.
2009
31 Dec.
2008
1 854
13
32
50
45
1 994
1 920
13
28
39
52
2 052
Maturity structure for deferred tax assets related to losses carried forward
Matures within one - five years
Matures in more than five years
No maturity date
Closing balance
31 Dec.
2009
1
424
425
31 Dec.
2008
1
392
393
Unreported tax assets
Losses carried forward
Other temporary differences
Total
31 Dec.
2009
384
14
398
31 Dec.
2008
487
4
491
Jan.-Dec. Jan.-Dec.
2009
2008
6
19
11
5
-158
26
-91
92
1
56
28
-1
-7
164
-11
229
-152
77
Jan.-Dec. Jan.-Dec.
2009
2008
-66
0
4
11
-7
-58
0
3
-6
-15
52
34
It has been deemed that unreported tax assets will not be utilised within the foreseeable future.
As a result of a merger carried out within the Spanish operations during 2006, potential deferred tax assets may arise. These tax
assets have not been finally established and are deemed to be uncertain by nature, for which reason they will be reported in line
with their realisation in future periods.
Taxable temporary differences exist with regard to shares of subsidiaries. Because there is no plan in the foreseeable future to sell
the companies, deferred tax has not been reported for these differences.
Deferred tax directly attributable to assets held for sale amounts to:
Deferred tax assets
Deferred tax liabilities
Total
Ygeia TopHolding AB
31 Dec.
2009
-
31 Dec.
2008
30
186
216
24 / 56
Note 8: Minority share of net loss for the year
Minority share of net profit after tax amounted to 58 MSEK (13) and of total comprehensive income 55 MSEK (19). At year-end, the minority
share of shareholders’ equity amounted to 283 MSEK (268).
Note 9: Goodwill
The Group tests goodwill for impairment on at least an annual basis, and otherwise when changes in events or situations indicate that the carrying
amount cannot be recovered. If such a test indicates that the carrying amount is too high, a recoverable amount is established for the asset, which is
the higher of net realisable value and value in use, or the cash flow attributable to the relevant cash-generating units within Capio. An impairment
loss is calculated based on the difference between the carrying amount and the estimated recoverable amount. When calculating the value in use, a
number of key assumptions and assessments must be made to estimate future cash flows.
Key assumptions and assessments consist primarily of future revenues, expenses, market growth, investments and discount rate. The time period
for which future cash flows are forecast is the current 3 year plan from 2010 to 2012, after which a growth rate of 2.5 % is applied. Management
establishes the discount rate in accordance with a principle, whereby consideration is given to time values and specific risks related to each cashgenerating unit but overall rate pre tax was 8.6 %. Future revenues, expenses and investments are based on approved budget and business plans in
the future periods.
The Group’s goodwill is mainly attributable to the Capio AB acquisition made in 2006. There was no need to recognise an impairment loss on the
closing date. Reasonable changes to assumptions applied in the impairment test, does not impact the impairment assessment. Goodwill attributable
to the acquisition of Unilabs in 2007 were reclassified as assets held for sale at 31 December 2008.
Opening acquisition value
Reclassification to operations being discontinued
Acquisitions during the year
Divestments/reclassification
Translation differences
Closing accumulated acquisition value
2009-12-31
6 474
100
-50
-275
6 249
2008-12-31
10 810
-5 095
62
0
697
6 474
6 249
6 474
2009-12-31
1 705
2 735
1 285
524
6 249
2008-12-31
1 801
2 889
1 231
553
6 474
Opening impairment losses
Divestments/reclassification
Translation differences
Closing accumulated impairment
Closing residual value, according to plan
Goodwill has been distributed among the various business areas, which constitute the lowest cash-generating units.
Consolidated goodwill items
Capio Healthcare Spain
Capio Healthcare France
Capio Healthcare Nordic
Capio Healthcare Germany
Total
Ygeia TopHolding AB
25 / 56
Note 10: Other intangible assets
Rental
1)
contracts
887
-47
840
Other
intangible
assets 1)
274
6
112
5
-15
382
Total
4 525
6
112
5
-196
4 452
2009-12-31
Opening acquisition value
Reclassification to operations being discontinued
Assets in acquired units
Purchases during the year
Divestments/reclassifications
Translation differences
Closing accumulated acquisition values
Brand
2 016
-85
1 931
Healthcare
contracts
1 348
-49
1 299
Opening amortisation
Reclassification to operations being discontinued
Assets in acquired units
Amortisation for the year
Divestments/reclassifications
Translation differences
Closing accumulated amortisation
0
0
0
-330
-146
10
-466
-74
-32
5
-101
-146
0
-39
1
8
-176
-550
0
-217
1
23
-743
1 931
833
739
206
3 709
Closing carrying amount
1) Rights to the use of premises on non-commercial terms. Other intangible rights primarily consist of capitalised software costs.
Of the net book value a total amount of 3,502 MSEK relate to intangible assets recognised as part of business combinations.
Rental
1)
contracts
768
119
887
Other
intangible
assets 1)
361
-158
3
33
0
33
274
Total
4 690
-690
3
33
0
488
4 525
2008-12-31
Opening acquisition value
Reclassification to operations being discontinued
Assets in acquired units
Purchases during the year
Divestments/reclassifications
Translation differences
Closing accumulated acquisition values
Brand
2 091
-289
213
2 016
Healthcare
contracts
1 469
-244
123
1 348
Opening amortisation
Reclassification to operations being discontinued
Assets in acquired units
Amortisation for the year
Divestments/reclassifications
Translation differences
Closing accumulated amortisation
-10
10
0
0
-211
45
-144
-20
-330
-34
-30
-10
-74
-236
136
0
-29
1
-18
-146
-491
191
0
-203
1
-48
-550
2 016
1 018
813
128
3 975
Closing carrying amount
1) Rights to the use of premises on non-commercial terms. Other intangible rights primarily consist of capitalised software costs.
Of the net book value a total amount of 3,846 MSEK relate to intangible assets recognised as part of business combinations.
Note 11: Equipment, tools, fixtures and fittings
Opening acquisition value
Reclassification to operations being discontinued
Assets in acquired/divested units
Purchases during the year
Sales/disposals for the year
Reclassifications
Translation differences
Closing accumulated acquisition value
2009-12-31
4 320
-5
423
-111
-37
-190
4 400
2008-12-31
4 500
-1 037
98
438
-34
-102
457
4 320
Opening depreciation
Reclassification to operations being discontinued
Assets in acquired/divested units
Depreciation for the year
Sales/disposals for the year
Reclassifications
Translation differences
Closing accumulated depreciation
-2 718
11
-367
98
21
116
-2 839
-2 779
702
-66
-299
29
-32
-273
-2 718
1 561
1 602
Closing carrying amount
Ygeia TopHolding AB
26 / 56
Note 12: Buildings and land
Buildings
Opening acquisition value
Reclassification to operations being discontinued
Assets in acquired/divested units
Purchases during the year
Sales for the year
Reclassifications
Translation differences
Closing accumulated acquisition value
2009-12-31
6 393
0
130
336
-199
-7
-284
6 369
2008-12-31
5 527
-366
111
294
-29
147
709
6 393
Opening depreciation
Reclassification to operations being discontinued
Assets in acquired/divested units
Depreciation for the year
Sales for the year
Reclassifications
Translation differences
Closing accumulated depreciation
-1 363
0
0
-261
18
-15
65
-1 556
-1 168
189
-3
-227
3
-14
-143
-1 363
Opening impairment
Adjustment of opening balance*
Reclassification to operations being discontinued
Impairment in acquired/divested units
Impairment for the year
Sales for the year
Reclassifications
Translation differences
Closing accumulated impairment
-62
0
0
0
-5
3
0
1
-63
0
-23
0
0
-33
0
-6
0
-62
4 750
4 968
2009-12-31
-
2008-12-31
-
Closing carrying amount
There were no tax assessment values on any properties.
Taxation values
- Buildings
- Land
Of the closing residual value according to plan, 611 MSEK (607) is attributable to financial leasing contracts.
*) This refers to an adjustment of incorrect book value (Building) of a finance lease in the local accounts of a subsidiary at the time
of the Capio acquisition in 2006. Should this finance lease have been correctly accounted for at the time of the Capio acquisition in
2006 the surplus value related to this asset would have been adjusted with the same amount. However, as the 12 month period past
acquisition elapsed this adjustment is accounted for as an error according to IAS 8.
2009-12-31
1 477
0
0
0
3
-77
2008-12-31
1 289
-8
4
0
-6
3
195
1 403
1 477
-2
0
0
-1
-7
0
0
0
-10
-1
0
0
-1
0
0
0
0
-2
Closing carrying amount
1 393
1 475
Sum Building and land
6 143
6 443
Land and land improvements
Opening acquisition value
Reclassification to operations being discontinued
Assets in acquired/divested units
Purchases during the year
Sales for the year
Reclassifications
Translation differences
Closing accumulated acquisition value
Opening depreciation
Reclassification to operations being discontinued
Depreciation in acquired/divested units
Depreciation for the year
Impairment for the year
Sales for the year
Reclassifications
Translation differences
Closing accumulated depreciation
Ygeia TopHolding AB
27 / 56
Note 13: Financial fixed assets
2009-12-31
2008-12-31
Proportion of equity in associated companies
Opening acquisition value
Reclassifications to operations being discontinued
Assets in acquired units
Purchases during the year
Sales for the year
Reclassifications
Cancelled impairment
Closing proportion of equity
5
0
0
0
0
5
0
10
6
-3
0
2
0
0
0
5
Other long-term holdings in securities
Opening acquisition value
Reclassifications to operations being discontinued
Assets in acquired units
Purchases during the year
Sales for the year
Impairment losses
Reclassifications
Translation differences
Closing acquisition value
25
0
0
0
-1
-2
0
-1
21
73
-56
0
6
-1
0
0
3
25
Derivative instruments
Opening acquisition value
Assets in acquired units
Purchases during the year
Sales for the year
Revaluations during the year
Reclassifications
Translation differences
Closing acquisition value
2
0
0
0
0
-2
0
0
103
0
2
0
-103
0
0
2
Other long-term receivables
Opening acquisition value
Reclassifications to operations being discontinued
Assets in acquired units
Lending during the year
Amortisation during the year
Reclassifications
Translation differences
Closing acquisition value
52
0
0
21
-4
54
-2
121
57
-2
0
6
-17
0
7
52
Total financial fixed assets
Whereof interest-bearing
Whereof non-interest-bearing
152
5
147
84
5
79
Ygeia TopHolding AB
28 / 56
Note 14: Accounts receivable and other receivables
Accounts receivable
Prepaid expenses and accrued income
Other receivables
Total
2009-12-31
2 244
203
468
2 915
2008-12-31
1 825
186
214
2 225
Provisions for doubtful receivables relating to accounts receivable amounted to 178 MSEK (187). Reported
impairment losses are based on historical experience and individual assessments and were charged against
earnings in the respective period. Management deems that the carrying amount of accounts receivable, prepaid
expenses and accrued income, as well as other receivables, corresponds to the fair value. Management deems
that there is no specific credit risk related to outstanding accounts receivable. Management bases this assessment
on the fact that no individual customer accounts for a dominant share of outstanding accounts receivable. The
average credit period normally amounts to 30-90 days.
Provisions on the opening date
Reclassifications to operations being discontinued
Provisions in acquired units
Provisions for anticipated losses
Actual losses
Recovered claims
Other
Translation difference
Provisions on the closing date
2009-12-31
187
5
26
-14
-17
-9
178
2008-12-31
213
-44
3
9
-6
-9
21
187
The year's costs for doubtful receivables amounted to 31 MSEK (24). Reserves for doubtful accounts receivable
amounted to 8 per cent (10) of total accounts receivable on the closing date.
Maturity periods for receivables
Receivables overdue but not impaired
Less than 30 days overdue
30 - 90 days overdue
91 - 120 days overdue
More than 120 days overdue
Total
2009-12-31
328
80
36
88
532
2008-12-31
397
261
61
104
823
There were no other overdue receivables on the closing date.
Ygeia TopHolding AB
29 / 56
Note 15: Interest-bearing liabilities and provisions
Long-term external borrowing
Maturity periods
1-2 years
2-3 years
3-4 years
4-5 years
Longer than 5 years
Shareholder loans
Maturity periods
1-2 years
2-3 years
3-4 years
4-5 years
Longer than 5 years
Total long-term liabilities
Other interest-bearing items, external
Interest-bearing pension provisions
Current external liabilities
Total interest-bearing liabilities and provisions
Less pension provisions
Total interest-bearing liabilities
Ygeia TopHolding AB
2009-12-31
2008-12-31
142
121
1 189
3 030
4 544
9 026
83
81
83
658
8 461
9 366
3 790
3 790
3 615
3 615
12 816
12 981
265
134
399
298
233
531
13 215
-265
12 950
13 512
-298
13 214
30 / 56
Note 15 (cont): Interest-bearing liabilities and provisions
The Group's external borrowing is in the following currencies:
31 December 2009
Commitments in financial leasing
Overdraft facilities 1)
Bank loans
Other loans
Shareholder loans
SEK
1 299
1
1 300
EUR
513
56
6 941
230
3 789
11 529
GBP
0
NOK
121
121
In the local currency:
1 300
1 114
0
97
31 December 2008
Commitments in financial leasing
Overdraft facilities 1)
Bank loans
Other loans
Shareholder loans
SEK
1 205
1 205
EUR
426
66
7 284
361
3 615
11 752
GBP
128
128
NOK
129
129
In the local currency:
1 205
1 075
11
117
Total
634
56
8 240
231
3 789
12 950
Total
684
66
8 489
361
3 615
13 214
1)
Overdraft facilities are reported net insofar as they are included in the Group account structure for the
various currencies. Unutilised overdraft facilities amounted to 299 MSEK (298).
Average interest (%) was paid as shown below:
31 December 2009
Commitments in financial leasing
Overdraft facilities
Bank loans
Other loans
Shareholder loans
SEK
0,87
4,30
15,00
-
EUR
5,55
1,92
5,35
4,54
13,00
GBP
-
NOK
5,24
-
31 December 2008
Commitments in financial leasing
Overdraft facilities
Bank loans
Other loans
Shareholder loans
SEK
4,80
6,82
-
EUR
5,68
5,07
6,33
3,50
13,00
GBP
7,36
-
NOK
5,09
-
Ygeia TopHolding AB
31 / 56
Note 16: Financial instruments
Financing and financial risk management
Financing of the Group primarily takes place via bank loans, but also through financial and operational leasing. The Capio Group's main financing source is a
syndicated Facilities Agreement (SFA) with a group of international lenders. That was entered in conjunction with the aquisition of the Capio Group in November
2006. The original total commitment was 8,945 MSEK and an additional 875 MSEK was committed in 2008. 8,487 (8,758) were utilized in total and 1,275 (1,439)
unutilised as of 31 December. During the year, the utilised amount has been affected by changes in the EUR/SEK rate and scheduled amortisations. Capio has as
part of the credit agreement undertaken to maintain certain financial covenants. The most important covenants are consolidated operating earnings before
depreciation in relation to consolidated net debt and cash flow excluding financial payments in relation to financial payments.
Exchange-rate risks
Exchange-rate movements affect the Capio Group’s earnings and equity in various ways. Transaction risks consist of commercial flows in foreign currency.
Business operations normally only involve revenues and costs in local currency, since Capio provides services in local markets. This means that commercial
currency flows are very limited in the Group. Currency effects on operating income of subsidiaries therefore amount to small sums. During the financial year
currency effects amounted to net income of 38 MSEK (net cost 76) (revenues of 38 MSEK and costs of 0 MSEK) for the Group.
In translating the earnings and net assets of foreign subsidiaries into SEK, a currency exposure arises that may affect consolidated earnings and equity. To limit
currency exposure, the currency mix in the Group’s cash flow is matched with the interest-bearing gross debt, meaning that financing is raised in the same currency
in which the asset is valued. On the other hand, this type of risk is not normally hedged actively.
Consolidated results are also affected by exchange-rate fluctuations in the translation of the results of subsidiaries to SEK. This effect is not hedged.
Interest-rate risks
The Group’s income derives primarily from contracts with prices that are normally adjusted annually and usually track each country’s inflation and economic
trends. Ongoing operations are normally financed using variable or short interest periods (up to 3 months). Use of longer interest periods are determined case by
case based on prevailing conditions in order to minimise interest risks.
Financing of special assets must take place with interest rate periods that reflect the underlying asset. In order to reduce interest risk and achieve the desired interest
rate periods in the debt portfolio, financial instruments are used, primarily in the form of swap agreements. Interest derivatives, primarily interest-rate swaps, are
used in conjunction with the SFA, as well as for a financial lease in Norway with interest-rate-linked rent.
Derivates contracts with a nominal value of 11,909 (7,287) had an average fixed interest rate of 3.52 % (3.82) and an average variable interest rate of 1.56 %
(4.74). The estimated fair value of current interest-rate derivatives amounted to -190 (-132) on the closing date. This amount was based on current market listings.
Some of these interest-rate derivates satisfy the requirements for hedge accounting, meaning that changes in fair value are recognised in other comprehensive
income. For interest-rate derivates that are not deemed to satisfy the requirements for hedge accounting, changes in fair value are recognised in the income
statement.
Financing and liquidity risk
Financing risk is the risk that costs become higher and that financing options may be limited when loans are renewed and that payment obligations cannot be
fulfilled due to insufficient liquidity or difficulty in raising financing. The Group’s cash and cash equivalents are placed in bank accounts or deposited with
reputable banks or in marketable securities issued or secured by governments or reputable banks.
Apart from the credit facilities described above, the Group has no short-term credit undertakings.
Credit and counterparty risk
Credit risks may arise if a counterparty does not fulfil its obligations according to signed agreements. The risk that a counterparty will not fulfill its obligations
according to financial contracts is limited through the selection of credit-worthy counterparties and by limiting the commitment per counterparty.
Ygeia TopHolding AB
32 / 56
Note 16 (cont.): Financial instruments
Fair value
The fair values of Capio's interest-bearing financial assets and liabilities are summarised in the table below:
31 December 2009
Financial assets
Cash and cash equivalents
Other financial fixed assets
Interest-rate derivatives
Financial liabilities
Interest-bearing provisions
Commitments in financial leasing
Overdraft facilities
Bank loans
Other loans
Subordinated internal loans, Parent Company (CPEC)
Interest-rate derivatives
31 December 2008
Book
value
Fair value
Book
value Fair value
518
5
0
518
5
0
444
5
0
444
5
0
265
634
56
8 240
231
3 789
-190
265
634
56
8 240
231
3 789
-190
298
684
66
8 489
361
3 615
-132
298
684
66
8 489
361
3 615
-132
Bank loans has variable interest rates and thus expose the Group to cash-flow risks in interest payments. The Group's portfolio of interest-rate derivatives had a
nominal value of 11,909 MSEK (7,287) at 31 December 2009.
In connection with the downstream merger between Capio AB and Opica AB during 2007, Capio AB assumed Convertible Preferred Equity
Certificates, CPEC, that were used by Opica AB to finance the acquisition of Capio AB. According to the agreement these instruments are
subordinated to all other present and future obligations apart from the shares in Capio AB and conversion can be requested by both the issuer
and holder of the CPEC. If Capio AB requests conversion all holders must give their consent to the transaction. As a consequence there is a
restriction on how and when the issuer can request conversion. CPEC cannot be converted to a predetermined number of shares giving that
the CPEC in its entirety is classified as interest-bearing debt in the accounts.
The fair values of Group's portfolio interest-rate derivatives, which consist of interest-rate swaps and interest caps as of 31 December 2009,
are summarised below.
31 December 2009
Interest swap
Derivative
Interest cap
Total
Currency
MEUR
MSEK
MNOK
MSEK
Whereof recognised under hedge accounting in other comprehensive income
Whereof recognised at fair value in the income statement
31 December 2008
Interest swap
Interest cap
Total
Derivative
Currency
MEUR
MSEK
MNOK
MSEK
Whereof recognised under hedge accounting in other comprehensive income
Whereof recognised at fair value in the income statement
Ygeia TopHolding AB
Hedged value Hedged value in MSEK Fair value
903
9 349
-173
1 900
1 900
-14
49
60
-3
600
600
0
-190
-190
0
Hedged value Hedged value in MSEK Fair value
560
6 127
-120
500
500
-9
51
60
-3
600
600
0
-132
-132
0
33 / 56
Note 16 (cont.): Financial instruments
31 December 2009
Derivative maturity periods
Interest-rate swaps
Interest caps
Interest floors
Maturity period
Within 1 year 1-2 years
2-3 years
5 609
5 609
600
-
3-4 years
60
-
4-5 years
-
>5 years
31
-
Total
5 700
5 609
600
31 December 2008
Derivative maturity periods
Interest-rate swaps
Interest caps
Interest floors
Maturity period
Within 1 year 1-2 years
2-3 years
2
2 419
4 213
600
-
3-4 years
3
-
4-5 years
50
-
>5 years
-
Total
6 687
600
0
Sensitivity analysis of interest-rate risks
Changes in market interest rates affect the Group’s interest income and expenses. The summary below shows the effect of a change in market interest rates on
Capio's income statement.
Jan. - Dec.
2009
29
Per cent
(+/-) 1%
Market interest rate
Jan. - Dec.
2008
26
Sensitivity analysis for exchange-rate risk
Changes in exchange rates impact the Group’s finances and financial position. The summary below shows the effect that exchange-rate fluctuations have on the
Group's income statement.
The most important currency is EUR for which a change of +10% has the following effect:
Jan. - Dec.
2009
Income statement – net profit
38
Shareholders' equity
400
Jan. - Dec.
2008
0
325
Interest income and interest expense from financial instruments
The table below shows interest income and interest expense related to all financial assets and financial liabilities.
Jan. - Dec.
2009
17
Jan. - Dec.
2008
110
Interest expense for financial liabilities
-987
-733
Total
-970
-623
Interest income from financial assets
The reason why expenses differ from the reported net interest in net financial items is mainly because interest income and expenses attributable to pensions are
excluded.
Ygeia TopHolding AB
34 / 56
Note 16 (cont.): Financial instruments
Net gains/losses for financial instruments reported in the income statement.
The table below shows the following items reported in the income statement:
Gains and losses attributable to exchange-rate differences, including gains and losses attributable to hedge accounting
Gains and losses attributable to financial instruments for which hedge accounting is applied
Gains and losses attributable to derivatives for which hedge accounting is not applied
Net gains/losses
Loans and accounts receivable
Total
Jan. - Dec.
2009
38
38
Jan. - Dec.
2008
-76
-76
Inefficiency in hedge accounting
The table below shows the net gains and losses for the loans and interest swaps reported at fair value.
Hedge accounting at fair value
Financial liabilities (hedged item)
Interest-related derivatives (hedging instruments)
Total (ineffectiveness)
Net gain/ loss
Jan. - Dec.
2009
Net gain/ loss
Jan. - Dec.
2008
58
235
-58
0
-235
0
31 Dec.
2009
31 Dec.
2008
0
19
115
134
0
0
233
233
142
121
1 189
3 030
8 334
12 816
83
81
83
658
12 077
12 981
Maturity structure of financial liabilities
Maturity structure of financial liabilities
<1 month
1 - 3 months
3 - 12 months
Total 0 - 12 months
1-2 years
2-3 years
3-4 years
4-5 years
Longer than 5 years
Total > 1 year
The summary above only includes interest-bearing liabilities. Other financial liabilities,
such as accounts payable and advances to suppliers, have contracted payment dates within 1-60 days.
Ygeia TopHolding AB
35 / 56
Note 16 (cont.): Financial instruments
Categorisation 2009
ASSETS
(MSEK)
Valued at
fair value in
the income
statement
Derivative
identified as
hedging
instrument
Investments
held until
maturity
Loans and
receivables
Financial
assets
available for
sale
Other
financial
assets
Nonfinancial
assets
TOTAL
Goodwill
Other intangible assets
Intangible assets
6 249
3 709
6 249
3 709
9 958
Land and buildings
Equipment, tools, fixtures and fittings
Tangible assets
6 143
1 561
6 143
1 561
7 704
Financial fixed assets, interest-bearing
Financial fixed assets, non-interest bearing
Deferred tax assets
Financial fixed assets
Total fixed assets
Inventory
Accounts receivable
Other receivables
Current tax assets
Prepaid expenses and accrued income
Short-term investments and interest-bearing receivables
Cash and cash equivalents
Total current assets
Total assets
LIABILITIES
(MSEK)
5
Ygeia TopHolding AB
468
0
203
34
518
-
-
-
2 801
-
Valued at
Derivative
Financial
fair value in identified as
liabilities
the income
hedging
available for
statement
instrument
sale
147
Other
financial
liabilities
9 026
3 790
93
75
190
134
241
1 516
-
190
571
249
2 244
Provisions for compensation to employees, interest-bearing
Provisions, non-interest bearing
Deferred tax liabilities
Long-term liabilities, interest-bearing
Shareholder loans, interest bearing
Long-term liabilities, non-interest bearing
Long-term liabilities, non-interest bearing to group companies
Total long-term liabilities and provisions
Interest-bearing current liabilities
Advances from customers
Accounts payable, trade
Other current liabilities
Current tax liabilities
Accrued expenses and prepaid income
Total current liabilities
Total liabilities and provisions
147
-
14 875
19 153
Nonfinancial
liabilities
265
277
1 994
863
105
987
4 491
5
147
571
723
18 385
249
2 244
468
0
203
34
499
3 769
22 101
TOTAL
265
277
1 994
9 026
3 790
283
75
15 710
134
241
1 516
863
105
987
3 846
19 556
36 / 56
Note 16 (cont.): Financial instruments
Categorisation 2008
ASSETS
(MSEK)
Valued at
fair value in
the income
statement
Derivative
identified as
hedging
instrument
Investments
held until
maturity
Loans and
receivables
Financial
assets
available for
sale
Other
financial
assets
Nonfinancial
assets
TOTAL
Goodwill
Other intangible assets
Intangible assets
6 474
3 975
6 474
3 975
10 449
Land and buildings
Equipment, tools, fixtures and fittings
Tangible assets
6 443
1 602
6 443
1 602
8 045
Financial fixed assets, interest-bearing
Financial fixed assets, non-interest bearing
Deferred tax assets
Financial fixed assets
Total fixed assets
Inventory
Accounts receivable
Other receivables
Current tax assets
Prepaid expenses and accrued income
Short-term investments and interest-bearing receivables
Cash and cash equivalents
Assets attributable to discontinuing operations
Total current assets
Total assets
LIABILITIES
(MSEK)
5
2
Ygeia TopHolding AB
570
227
1 825
214
30
186
11
444
8 850
-
2
-
2 285
-
Valued at
Derivative
Financial
fair value in identified as
liabilities
the income
hedging
available for
statement
instrument
sale
Provisions for compensation to employees, interest-bearing
Provisions, non-interest bearing
Deferred tax liabilities
Long-term liabilities, interest-bearing
Shareholder loans, interest bearing
Long-term liabilities, non-interest bearing
Total long-term liabilities and provisions
Interest-bearing current liabilities
Advances from customers
Accounts payable, trade
Other current liabilities
Current tax liabilities
Accrued expenses and prepaid income
Liabilities attributable to discontinuing operations
Total current liabilities
Total liabilities and provisions
77
77
Other
financial
liabilities
9 366
3 615
49
132
233
173
1 318
-
132
-
14 755
28 571
Nonfinancial
liabilities
298
356
2 052
540
156
1 068
8 100
12 570
5
79
570
654
19 148
227
1 825
214
30
186
11
444
8 850
11 787
30 935
TOTAL
298
356
2 052
9 366
3 615
182
15 869
233
173
1 318
540
156
1 068
8 100
11 588
27 457
37 / 56
Note 17: Other non-interest bearing items
Prepaid expenses and accrued income
Prepaid rent
Accrued income
Other prepaid expenses
Total
Non-interest bearing provisions:
Deferred tax liability
Provision for supplementary purchase payments
Other
Total
Long-term interest-free liabilities, external:
Maturity periods:
1-2 years
2-3 years
3-4 years
4-5 years
More than 5 years
Total
31 Dec. 2009
31 Dec. 2008
41
117
45
203
38
89
59
186
1 994
25
252
2 271
2 052
24
332
2 408
32
7
7
7
40
22
2
4
3
19
93
50
Fair value of financial instruments
190
132
Total
283
182
Accrued expenses and prepaid income
Holiday pay liabilities
Other personnel-related costs
Interest and financial expenses
Prepaid revenues
Other accrued expenses
Total
216
307
45
140
279
987
205
306
120
179
257
1 068
Note 18: Provisions
December 31 2009
Opening acquisition value
Reclassified to assets held for sale
Purchase of acquired units
Utilised funds
Provisions for the year
Translation differences
Provisions at year-end
Non-interest
bearing
provisions
356
-121
57
-15
277
December 31 2008
Opening acquisition value
Reclassified to assets held for sale
Purchase of acquired units
Utilised funds
Provisions for the year
Translation differences
Provisions at year-end
Non-interest
bearing
provisions
339
-103
-34
117
37
356
Ygeia TopHolding AB
38 / 56
Note 19: Pledged assets
For own debts and provisions
31 Dec. 2009
31 Dec. 2008
11 415
5
646
1 386
3
13 455
12 174
4
663
1 229
6
14 076
For long-term liabilities to credit institutions
1)
Shares in subsidiaries
Cash and cash equivalents
Chattel mortgages
Property mortgages
Machinery and equipment
1) Refers to consolidated residual values, including brand totalling 1,931 MSEK (2,016).
Note 20: Contingent liabilities
Guarantee commitments
Total contingent liabilities
31 Dec. 2009
190
190
31 Dec. 2008
217
217
Note 21: Shares in subsidiaries
For information regarding subsidiaries, see Note 6 in the Parent Company notes.
Ygeia TopHolding AB
39 / 56
Note 22: Audit fees
The following fees were paid to auditing firms for conducting audits and other review
measures in accordance with prevailing legislation and for advisory services and other assistance
related to observations from the auditing measures conducted. Fees were also paid for independent
advisory services conducted by elected auditors and other auditing firms within the areas of taxation, financial
services and other consulting services.
Auditors are elected by the Annual General Meeting for a period of four years.
Jan.-Dec. 2009 Jan.-Dec. 2008
Fees for audit conducted by elected auditors Ernst &
Young
Fees for tax-related services performed by elected
auditors Ernst & Young
Fees for audit conducted by elected auditors, other
auditing firms
Fees for consulting services performed by Ernst &
Young
Total fees to elected auditors
15
14
2
0
1
2
4
1
22
17
Audit
Auditing services primarily relate to auditing of the Group companies' accounts, review of interim reports,
IT systems and other review measures in accordance with prevailing regulations performed by
elected auditors to provide an auditor’s report for the Group’s annual report. The annual audit is
subject to approval by the Audit Committee. The Audit Committee monitors the auditor’s work continuously
during the financial year and has the authority to approve any changes in the terms of the annual audit.
Audit-related services
Audit-related services refer to services that are performed in close connection to the review of the
consolidated accounts and include due diligence assignments, assistance in interpretation and application
of new accounting policies and assistance in reporting requirements relating to internal controls.
Tax-related services
Tax services refer to services related to compliance with rules for tax reporting and other advisory
services related to taxation.
Other services
Other services that can be performed by the elected auditors require approval by the Audit Committee.
Ygeia TopHolding AB
40 / 56
Note 23: Rents and leasing fees
Operational leasing
The Group’s operational leasing contracts primarily comprise rented premises in which business is conducted, technical medical equipment, computers
and other equipment. Leasing contracts are reported until such time as they can be terminated. Sub-leasing primarily occurs for premises for Group
companies.
Jan.-Dec. 2009
339
73
Jan.-Dec. 2008
274
29
Total leasing fees
412
304
Of which variable fees
110
44
Leasing fees attributable to
Properties
Other fixed assets
Future minimum operational leasing fees at 31 December 2009 that cannot be prematurely terminated and which have terms longer than one year
due for payment in:
2010
2011
2012
2013
Year 2014 and later
Total
268
271
223
102
827
1 691
Financial leasing
The Group’s financial leasing contracts relate to premises in which business is conducted, as well as technical medical equipment. None of these
contracts are sub-leased.
Jan.-Dec. 2009
Jan.-Dec. 2008
Property
67
63
Equipment, tools, fixtures and fittings
20
16
Total leasing fees
87
79
Of which variable fees
77
57
2009
909
-227
682
2008
774
-237
537
Leasing fees attributable to:
Carrying amounts for financial leasing at the closing date amounted to:
Accumulated acquisition value
Accumulated depreciation/impairment
Closing book value
Depreciation and impairment for the year amounted to 40 MSEK(36).
Future minimum financial leasing fees at 31 December 2009 that cannot be prematurely terminated and which have terms longer than one year due
for payment in:
2010
2011
2012
2013
Year 2014 and later
Totalt
Actual payment
99
101
99
95
420
814
Estimated present
value of payments
94
91
86
78
261
610
The actual interest rate is determined on the contract date for all leasing periods. The average interest terms in the contracts varies
between 2.7 and 6.0 %.
Total minimum future leasing fees
Interest expense
Present value of minimum future leasing fees
2009
2008
814
1 742
-204
-1 085
610
657
All leasing contracts are based on commercial terms. Certain contracts contain extension options with varying time periods.
Ygeia TopHolding AB
41 / 56
Note 24: Company acquisitions and divestments
2009
During the period from January to December 2009, a number of acquisitions took place of which none was significant.
Acquisitions during 2009
Acquisitions
Purchase price
155
Share of voting
rights, %
100
Share of equity,
%
100
All acquired companies are reported in the consolidated accounts in accordance with the purchase method, meaning that the purchase price
is allocated to acquired assets and liabilities based on each item’s fair value. Fair values are established based on valuation by an
independent external party with consideration taken to management’s assessment of the special character of each asset and liability.
Acquisitions during 2009
Kvalita Group (Sweden)
Coreysa (Spain)
Läkarmottagningen i Gårda AB (Sweden)
Klinikk Bunaes AS (Norway)
Besides the above mentioned acquisitions Capio Group acquired the net assets of two businesses in Vegeholm and Båstad (Sweden), from
which goodwill has arisen.
Financial effect
The contribution made by the acquired operations to the Group’s revenues and profit before tax was as follows:
Acquisitions
Net sales
253
Result after tax
-13
253
-13
No proforma figures prior to acquisition have been readily available.
Purchase price, goodwill and effect on cash flow
Purchase price
Cash amount
Transaction costs
Additional acquisition price
Total purchase price
Less market value of acquired net assets
Goodwill
Acquisitions
126
4
25
155
-55
100
Cash flow effect related to implemented acquisitions amounted to:
Purchase price
Outstanding purchase price - paid
Less outstanding purchase price
Adjustment for purchase price paid in 2008
Less acquired cash and cash equivalents
Cash-flow effect of acquisitions
Translation differences
Total
Ygeia TopHolding AB
Acquisitions
155
8
-69
-1
-16
77
0
77
42 / 56
Note 24 (cont.): Company acquisitions and divestments
Acquired assets and assumed liabilities
Acquired net assets and goodwill related to implemented acquisitions amounted to:
Trademarks, healthcare contracts, leases and other
intangible fixed assets
Buildings, land and land installations
Machinery and equipment
Deferred tax assets
Other financial fixed assets
Inventories
Accounts receivable and other current assets
Cash and cash equivalents
Total acquired assets
Minority interest
Provisions
Long-term liabilities
Current liabilities
Total assumed liabilities
Acquired net assets
Goodwill
Total purchase price
Less acquired cash and cash equivalents
Outstanding purchase price - paid
Less outstanding purchase price
Adjustment for purchase price paid in 2008
Translation differences
Cash-flow effect
Carrying
amount in
7
4
5
1
0
4
47
16
84
0
0
10
56
66
18
Fair value
adjustments
Fair value
37
128
0
0
0
0
0
0
165
0
0
128
0
128
37
155
44
132
5
1
0
4
47
16
249
0
0
138
56
194
55
100
155
-16
8
-69
-1
0
77
Acquired goodwill is attributable to the underlying profitability of the acquired operations. All significant fair values were based on
independent external valuations with consideration taken to the special character of each asset.
Pledged assets and contingent liabilities in acquired operations:
Acquisitions
Pledged assets
Contingent liabilities and guarantees
-
Divestments Jan. - Dec. 2009
Behandlingssenteret Små Enheter AS
Capio Deutsche Klinik Lübeck GmbH
Shares in Capio Holding AB to minority
Divested assets and liabilities
Net assets related to divested operations within remaining operations amounted to the following:
Divestments
Intangible fixed assets
Other fixed assets
Current assets
Long-term liabilities and provisions
Current liabilities
Divested net assets
Capital gain/loss from divested units
Less cash and cash equivalents in divested companies
Outstanding purchase payments at closing date
Received purchase payments from previous periods
Cash flow effect
BSE
Lübeck
MSEK
MSEK
Minority
Total
50
1
19
0
-7
63
0
1
3
-1
-1
2
77 *
50
2
23
-1
-8
142
-43
-10
-15
0
-5
3
0
0
0
5
-60
-3
14
-100
-10
-18
0
14
*) Minority share of net assets in Capio Holding AB
Ygeia TopHolding AB
43 / 56
Note 24 (cont.): Company acquisitions and divestments
2008
A number of acquisitions took place between January and December 2008, one of which was significant.
Acquisitions during 2008
Büdingen
Other acquistions
Purchase
price
122
68
Share of voting
rights, %
100
100
Share of equity,
%
100
100
All acquired companies are reported in the consolidated accounts in accordance with the purchase method, meaning that the
purchase price is allocated to acquired assets and liabilities based on each item’s fair value. Fair values are established based on
valuation by an independent external party with consideration taken to management’s assessment of the special character of each
asset and liability. Büdingen was consolidated as of March 2008.
Büdingen Group
In March 2008, 100 % of the shares in Mathilden-Hospital zu Büdingen GmbH, Mathilden-Hospital zu Büdingen Service GmbH,
Mathilden-Hospital zu Büdingen Wohnen GmbH and MVZ am Mathilden-Hospital zu Büdingen GmbH were acquired for 124
MSEK. Acquisition costs in conjunction with the purchase amounted to 5 MSEK. The Capio Group obtained a controlling interest
over the Büdingen Group as of March 2008, and the companies were consolidated as of that month.
Financial effect
The contribution made by the acquired operations to the Group’s revenues and profit before tax was as follows:
Büdingen
Other acquistions
Net sales
134
50
Result after tax
-5
1
184
-4
No proforma figures prior to acquisition have been readily available.
Purchase price, goodwill and effect on cash flow
Purchase price
Cash amount
Transaction costs
Additional acquisition price
Total purchase price
Less market value of acquired net assets
Goodwill
Büdingen Other acquisitions
120
65
2
3
122
68
-122
-6
0
62
Total
185
5
0
190
-128
62
Cash flow effect related to implemented acquisitions amounted to:
Purchase price
Outstanding purchase price - paid
Less outstanding purchase price
Less acquired cash and cash equivalents
Cash-flow effect of acquisitions
Translation differences
Total
Ygeia TopHolding AB
Büdingen Other acquisitions
122
68
36
-20
-7
102
96
2
-3
104
93
Total
190
36
0
-27
199
-1
198
44 / 56
Note 24 (cont.): Company acquisitions and divestments
Acquired assets and assumed liabilities
Acquired net assets and goodwill related to implemented acquisitions amounted to:
Trademarks, healthcare contracts, leases and other
intangible fixed assets
Buildings, land and land installations
Machinery and equipment
Deferred tax assets
Other financial fixed assets
Inventories
Accounts receivable and other current assets
Cash and cash equivalents
Total acquired assets
Minority interest
Provisions
Long-term liabilities
Current liabilities
Total assumed liabilities
Acquired net assets
Goodwill
Total purchase price
Less acquired cash and cash equivalents
Outstanding purchase price
Translation differences
Cash-flow effect
Carrying amount in acquired
companies
Other
Büdingen
acquisitions
3
96
28
1
0
2
40
20
190
0
18
10
47
75
115
0
0
1
0
4
0
5
7
17
2
1
0
9
11
6
Fair value adjustments
Other
Büdingen
acquisitions
0
7
0
0
0
0
0
0
7
0
0
0
0
0
7
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Fair value
Büdingen
Other
acquisitions
3
103
28
1
0
2
40
20
197
0
18
10
47
75
122
0
122
-20
2
104
Total fair
value
0
0
1
0
4
0
5
7
17
2
1
0
9
11
6
62
68
-7
36
-3
93
3
103
29
1
4
2
45
27
214
2
18
10
56
86
128
62
190
-27
36
-1
198
Acquired goodwill is attributable to the underlying profitability of the acquired operations. All significant fair values were based on independent external
valuations with consideration taken to the special character of each asset.
Pledged assets and contingent liabilities in acquired operations:
Pledged assets
Contingent liabilities and guarantees
Büdingen
165
-
Other
acquisitions
-
Total
165
-
Divestments Jan. - Dec. 2008
During 2008 Capio divested 20 % of the Spanish Operation. Cash consideration received amounted to 16 MSEK. In
addition, transaction costs related to the divestment of the UK business in 2007 was paid with 107 MSEK. In total the group
reports then 91 MSEK as negative cash flow from divested units.
Ygeia TopHolding AB
45 / 56
Note 25: Fixed assets held for sale/ divested operations
2009
During december 2009 the Unilabs Group was distributed to the Parent Company in Luxembourg at an Extraordinary General
Meeting. As a result of this, Unilabs' operations losses for the period, will be reported as discontinuing operations in the
consolidated accounts for 2009.
2009-01-01-2009-12-31
Net sales*
Direct costs
Other external costs
Personnel costs
Depreciation of tangible and amortisation of intangible assets
Other operating income
Other operating expenses
Operating loss
Financial net
Loss after financial items
Tax
Losses for the period from discontinued operations
4 257
-594
-1 972
-760
36
-979
-12
-434
-446
-104
-549
* Include 198 MSEK in net sales to the continuing business
2008
To streamline operations between Capio and Unilabs, the Parent Company intends to distribute the Unilabs Group to the Parent
Company in Luxembourg at an Extraordinary General Meeting during the second half of 2009. As a result of this, Unilabs'
operations will be reported as discontinuing operations in the consolidated accounts. The comparative figures for the income
statement and cash flow have been adjusted to reflect this change. Presented below is the 2008 income statement for the Unilabs
business area. A goodwill impairment of SEK 568 M and a trademark impairment of SEK 70 M were charged to the 2008 income
statement. Each impairment is recognised in the depreciation and impairments line in the income statement below, while deferred
tax attributable to trademark was recognised in the tax line.
Net sales*
Direct costs
Other external costs
Personnel costs
Depreciation of tangible and amortisation of intangible assets
Other operating income**
Other operating expenses
Operating loss
Financial net
Loss after financial items
Tax
Losses for the period from discontinued operations
2008-01-01-2008-12-31
3 578
-699
-827
-1 618
-858
9
-10
-425
-479
-904
-62
-966
* Include 169 MSEK in net sales to the continuing business
In the second quarter of 2008, Capio AB sold 20 per cent of Global Asuan, the holding company that owns Capio Healthcare
Spain, to the company management. A loss of SEK 5 M from the divestment was recognised directly in shareholders' equity as a
transfer from the Parent Company's shareholders' equity to minority interests.
Ygeia TopHolding AB
46 / 56
Note 26: Share capital
31 Dec 2009
31 Dec 2008
539,028 (539,028) common shares/preferential shares
54
54
Issued and paid:
At 1 January
New issue
New issue in progress
At 31 December
54
54
54
Share capital
There are 140,731 (140,731) common shares and 398,297 (398,297) preferential shares, making a total of 539,028 (539,028) shares.
Each preference share entails annual preference rights to dividends. In the event of the company's dissolution or liquidation, holders of
preference shares have preferential rights to an amount corresponding the average amount paid for all preference share and accrued nonpaid dividends.
Neither the Parent Company nor any Group company has holdings of own shares.
Dividends are proposed by the Board of Directors in accordance with the rules in the Swedish Companies Act and approved by the
Annual General Meeting. The Board of Directors proposal to the Annual General Meeting is that no dividend be paid for the financial
year from 1 January 2009 to 31 December 2009.
Note 27: Earnings per share
Earnings
Earnings attributable to Parent Company shareholders
Earnings attributable to Parent Company shareholders
Jan.-Dec. 2009
-29
-29
Jan.-Dec. 2008
-1 626
-1 626
Number of shares
Average number of shares during the reporting period
for calculation of earnings per share
Average number of shares during the reporting period for
calculation of earnings per share after dilution
Jan.-Dec. 2009
539 028
Jan.-Dec. 2008
539 028
539 028
539 028
Earnings per share (SEK)
Earnings per share
Dilution effect
Earnings per share after dilution
Jan.-Dec. 2009
-55
-55
Jan.-Dec. 2008
-1 224
-1 224
Earnings per share are calculated by dividing the earnings attributable to equity in the Parent Company by the average number of
outstanding shares during the period. There was no dilution effect with respect to earnings per share.
Note 28: Currency effects
The Group’s sales and purchases are almost exclusively denominated in local currency. This means that currency effects on operating
income of subsidiaries amount to small sums. During the financial year, currency effects amounted to net expense of 38 MSEK
(expense: 76) (income of 38 MSEK and costs of 0 MSEK) for the Group.
Accumulated translation differences on the opening date that were recognised in consolidated equity amounted to 748 MSEK (33). At
year-end, these differences amounted to 594 MSEK (748). The Group strives to hedge net assets in foreign currency through the
corresponding weighting of borrowing and thus match the cash flows in each currency.
Changes in exchange rates between EUR and SEK are the primary reason for translation differences in consolidated equity.
The consolidated income statement is also affected by translation of earnings in subsidiaries. This effect is not hedged.
Note 29: Investment commitments
Commitments for future investments
in fixed assets
Total
31 Dec 2009
31 Dec 2008
95
95
97
97
The Group’s investment commitments are primarily related to a number of major projects in progress. These significant projects
include investments related to Fonvert in France.
Ygeia TopHolding AB
47 / 56
Note 30: Parent Company
Ygeia TopHolding AB is a limited liability company according to Swedish law. The company provides
healthcare services through its subsidiaries. The company has its registered offices in Stockholm Sweden, the
address to the headquarter is:
Ygeia TopHolding AB
C/O Capio AB
Box 1064
SE-405 22 Gothenburg, Sweden
(Visiting address: Lilla Bommen 5)
Note 31: Information on related parties
Group companies
Transactions between Group companies and business areas are based on market terms. All internal
transactions are eliminated in the consolidated accounts. Related parties includes Group subsidiaries,
associated companies, Board members and senior executives. Subsidiaries and associated companies are
reported in Note 6 for the Parent Company. Deliveries of products and services between Group companies
take place on commercial terms at market prices.
In December 2009 Capio Spain entered into a finance lease agreement with an external company for certain
real estate used in the daily operations. The external company is controlled by certain members of
management in Capio Spain. The real estate lease is for 20 years with a capital value of 128 MSEK. During
the year a minority share in Capio Holding AB (owner of Capio AB group), indirectly owned by Ygeia
TopHolding AB, was divested to parts of senior executives of which some are also representatives as board
members in the parent company. In total 4.5% of the shares in Capio Holding AB is owned by senior
executives within the Group. All transactions are based on market terms.
Apart from salaries and other compensation and the transactions described above, no other transactions took
place between members of the Board of Directors and Group companies during the period from January to
December 2009. No Board member or senior executive had any direct or indirect participation in any
business transactions with the company that was unusual in its nature or with respect to its terms.
The management team of the Spanish operations have a direct ownership of 20% in the Spanish business.
Board members have received board fees of 0.2 MSEK in Group companies during 2009. Remuneration to
senior executives amounted to 55 MSEK (11) in salaries and 4 MSEK (2) in pensions. Number of senior
executives was 12 (6) for 2009.
Note 32: Events after the closing date
Acquisitions/Divestments
Divestment of the business in Switzerland (part of BA Germany) was completed in early January 2010. The
divestment did not signtificantly impact the Group's profit or equity.
New contracts
Capio Spain is part of a consortium that have been nominated preferred bidder status for a new 30 year care
concession agreement with the Madrid authorities. Capio Spain has the main responsibility for running the
care operations of the hospital which is located in the Mostoles area and has a responsibility to provide
healthcare to an approximate population of approximately 170,000 inhabitants. The new hospital is expected
to be fully operational in 2012.
Note 33: Inventories
Raw materials
Finished goods
Other
Total
31 Dec 2009
214
16
19
249
31 Dec 2008
203
15
9
227
Obsolescence is assessed based on age and the turnover rate for each item. Changes in reserves for
obsolescence during the period as a whole had an effect of 2 MSEK (0) on earnings. Deductions for
obsolescence amounted to 2 MSEK (0). Previous impairment losses were reversed in an amount of 0 MSEK
(0). Inventories corresponding to 0 MSEK (0) are expected to be sold after 12 months.
Note 34: Government grants
During the period, government grants primarily relating to completed training courses were received in an
amount of 2 MSEK (2). Received grants were recognised in earnings in the periods in which they were
received. Government grants for investments in assets amounted to 24 MSEK (21).
Ygeia TopHolding AB
48 / 56
Note 35: Restatement of Income statement reported in 2008
Income statement
Ygeia
TopHolding
Restated Jan Dec 2008
MSEK
Ygeia TopHolding as
of Jan.- Dec 2008
Reclass.*
Net sales
12 721
128
Direct materials and services cost
-2 858
0
308
Other external costs
-1 451
57
-308
Personnel costs
-7 282
1
-7 281
-772
Depreciation of tangible and amortisation of intangible assets
Reclass.**
12 849
-2 550
-1 702
-760
-12
Other operating income
218
-216
2
Other operating expenses
-42
42
0
Operating profit
546
-
-
546
*During the year the Group has changed from reporting a cost based income statement to a functional income statement in the internal operational reporting. This has e.g.
implied that part of income previously reported as Other operating income is now reported as Net sales and part of costs previously reported as Other operating expenses is now
included in Other external cost.
** The change from a cost based income statement to a functional income statement also implied that costs for support services and technical maintenance, previously reported
as costs of consumables, materials, services and equipment (included in Direct materials and services cost in the consolidated financial statements 2008) are now reported as
Other external costs.
Ygeia TopHolding AB
49 / 56
Parent Company income statement
MSEK
Notes
Net sales
Other external cost
1,5
Operating profit
Profit from financial fixed assets
2
Jan. - Dec. Jan. - Dec.
2009
2008
-
-
-
-
-
-
Interest income and other financial items
-
Interest expenses and other financial items
-
Profit after financial items
-
Tax
-
-
Profit for the period
-
-
Ygeia TopHolding AB
50 / 56
Parent Company balance sheet
MSEK
Notes
2009-12-31
2008-12-31
3 227
3 227
5 375
5 375
3 227
5 375
Assets
Fixed assets
Financial fixed assets
Shares in Group companies
Total fixed assets
3,6
Total assets
Shareholders' equity and liabilities
Shareholders' equity
Restricted equity
Share capital
Unrestricted equity
Share premium fund
Profit for the year
Total shareholders' equity
54
54
3 173
3 227
5 321
5 375
Total shareholders' equity and liabilities
3 227
5 375
-
-
Memorandum items
Pledges assets
Contingent liabilities
Ygeia TopHolding AB
4
51 / 56
Parent Company cash flow statement
MSEK
Notes
Jan.-Dec. 2009 Jan.-Dec. 2008
Current operations
Operating profit
Interest income
Interest expenses
Cash flow from current operations before changes in working capital
-
-
Changes in working capital
Changes in working capital
Cash flow from current operations
-
-
-
-
Financing activities
New share issue
Cash flow from financing activities
-
-
Changes in cash and cash equivalents
-
-
Cash and cash equivalents on the opening date
Cash and cash equivalents on the balance sheet date
-
-
Investment activities
Acquisitions of subsidiaries
Cash flow from investment activities
Ygeia TopHolding AB
3
52 / 56
Parent Company change in shareholders' equity
Share Share premium
capital
reserve
MSEK
Retained Profit/loss
earnings for the year
Shareholders'
equity
Opening balance 2007-12-31
Profit for the year
54
-
5 321
-
-
-
5 375
-
Closing balance 2008-12-31
54
5 321
0
0
5 375
The Parent Company's shareholders' equity comprises:
Share capital (539,028 shares)
Statutory reserve
Share premium reserve
Profit for the year
54
5 321
-
Total shareholders' equity
5 375
Share Share premium
capital
reserve
MSEK
Opening balance 2008-12-31
Dividend
Profit for the year
Closing balance 2009-12-31
Retained Profit/loss
earnings for the year
Shareholders'
equity
54
5 321
-
-
5 375
-
-2 148
-
-
-
-2 148
-
54
3 173
0
0
3 227
The Parent Company's shareholders' equity comprises:
Share capital (539,028 shares)
Statutory reserve
Share premium reserve
Profit for the year
54
3 173
0
Total shareholders' equity
3 227
Shareholders' equity
Share capital
Common shares
Preferential shares
Ygeia TopHolding AB
539,028 shares, of which
140,731
398,297
Par value: SEK 100
Par value: SEK 100
53 / 56
Accounting principles
The Parent Company prepared its annual report in accordance with the Swedish Annual Accounts Act
and the Swedish Financial Reporting Board’s recommendation RFR 2 Accounting for
Legal Entities and the statements of the Swedish Financial Accounting Standards Council's
Emerging Issues Task Force. The rules in RFR 2 mean that the Parent Company in the annual
report for the legal entity must apply all IFRS/IAS rules and statements adopted by the EU as
far as possible within the framework of the Annual Accounts Act and with consideration taken
to the relationship between accounting and taxation. There are recommendations regarding the
exceptions to IFRS/IAS that may be made. These regulations are described in the accounting
policies for the consolidated accounts.
The Parent Company applies the accounting principles specified for the Group with the
exceptions noted below.
Shares in Group companies are valued at acquisition value including external costs directly
attributable to the acquisition. The shares are valued at the lower of cost and fair value.
Amounts are in MSEK unless otherwise specified.
Ygeia TopHolding AB
54 / 56
Note 1: Salaries, other compensation and social costs
For information regarding salaries, other compensation and social costs, please refer to Note 4 for the Group.
Note 2: Financial items
Dividend from subsidiries
Impairment of shares i Group companies
Total profit from financial fixed assets
2009-12-31
2008-12-31
2 148
-2 148
0
-
2009-12-31
5 375
-2 148
2008-12-31
5 375
-
3 227
5 375
2009-12-31
-
2008-12-31
-
-
-
Note 3: Financial fixed assets
Shares in Group companies
Opening balance
Purchases during the year
Sales for the year
Impairment losses during the year
Closing balance
For further information, please refer to Note 13 for the Group.
Note 4: Contingent liabilities
Guarantee commitments
Other contingent liabilities
Total
Ygeia TopHolding AB
55 / 56
Note 5 Audit fees
Audit fees to Ernst & Young AB were paid by another Group company.
Note 6 Shares in subsidiaries
Shares in Subsidiaries
Ygeia Equity AB
Share of
equity
100%
Share of
voting rights
100%
Number of
shares
539 028
Carrying
amount
5 375
Impairment
-2 148
Closing
balance
3 227
Corp.
Reg. No.
556722-5130
Reg. Office
Stockholm
Impairment of the carrying amount of shares in the subsidiary Ygeia Equity AB was a result of that the company distributed all shares in Unilbas Holding AB
to the parent company.
Gothenburg, 23 March 2010
Thomas Berglund
Chairman
Robert Andreen
Hervé Descazeaux
Khawar Mann
Victor Madera
Fredrik Näslund
Nicolas Bonilla
Håkan Winberg
Our auditor's reprt was submitted on 23 March 2010
Ernst & Young AB
Staffan Landén
Authorised Public Accountant
Ygeia TopHolding AB
56 / 56