Lundbecks cash flows in foreign currencies in 1996 were concentrated around SEK, FRF, FIM and DEM block currencies and are also expected to be so in 1997. In addition to this, the cash flow in GBP is expected to be on the increase. Of the Groups total cash flows in foreign currencies in 1996, 36% of the cash flow was in the - as at 1 January 1999 - so-called safe EURO currencies. This share is increasing to 47% in the budgeted foreign currency cash flows for 1997. 110.00 105.00 100.00 95.00 90.00 85.00 Lundbecks exchange rate index (1996 weights) (1988 = index 100) H. Lundbeck A/S and its Danish subsidiaries incoming cash flow in foreign currencies: Realised 1996 80.00 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 The classification of safe EURO currencies from 1999 includes the following currencies: ATS, BEF, DEM, FIM, FRF and NLG, which are expected to proceed to stage 3 of the EMU cooperation, entailing the establishment of a common currency, the EURO, from 1999. With the exception of 1993, there was a slight improvement of the Lundbeck Groups exchange rate index for the first time since 1989. This is an indication of Lundbecks competitiveness in the long term. Lundbecks exchange rate index (the reciprocal krone rate index weighted with the shares of Lundbecks trading partners) was thus improved by approx. 0.4% in 1996. This is mainly due to the strengthening of the Swedish krone in 1996. Lundbecks considerable growth in turnover in the period 1988-1996 was achieved despite an unfavourable exchange rate development for the Group in this period. CASH MANAGEMENT When proceeding to stage 3 of the EMU in 1999, a well-planned cash management structure will provide significant advantages. In this field, a number of measures have been adopted in 1996 with the purpose of strengthening the Groups cash management as well as creating a platform for cash pooling/ interest netting across borders. From 1996, the Treasury & Tax department of H. Lundbeck A/S functions as an internal bank for the Groups companies within the fields of deposits, lending and of management of currency exposure. Furthermore, in 1996 an analysis of specific matters concerning the cash management in the Groups companies was carried out. The results of this analysis form the basis of a new bank policy for the Groups companies as well as a revision of existing procedures in this area. Moreover, there will be a greater focus on the individual Group companies abilities to generate cash flows from self-financing, cf. the statement of sources and application of funds. The establishment of a common external banking structure is expected to be commenced in 1997. This new, international banking structure is to fulfill the Groups future requirements and wishes. Safe EURO currencies Other European currencies USD and other non-European currencies 36% 51% 13% H. Lundbeck A/S and its Danish subsidiaries incoming cash flow in foreign currencies: Budget 1997 Safe EURO currencies Other European currencies USD and other non-European currencies 47% 42% 11% 37 CONTENTS Supervisory Board and Board of Management . . . . . . . . . . . . . . . . . . . . 4 The Sup SPECIALISTS IN PSYCHIATRY PIONEERS IN NEUROLOGY As a specialist, one must constantly seek knowledge SUPERVISORY BOARD Arne V. Jensen (Chairman) Jørgen Fakstorp (Vice-Chairman) Lars Bruhn Henrik He BOARD OF MANAGEMENT Erik Sprunk-Jansen President Eva Steiness Executive Vice President Research and 2,400 2,200 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 Net turnover (DKKm) 1,853 2,326 THE SUPERVISORY BOARDS REPORT DEVELOPMENT OF STRATEGY The rules of play for pharmaceutical companies 2,400 2,200 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 Average number of employees Outs THE SUPERVISORY BOARDS REPORT The development of Serdolect®/Serlect® for the American market has tak ART OR THERAPY In 1988 a group of Dutch psychiatrists formed the Art & Psychiatry Foundation arr Art & Psychiatry Foundation is therefore to question the concept art and serve as a mediator bet THE VALUE OF CREATIVE THERAPY In spite of the lack of scientific studies of creative therapy, both p and the methods we employ. For me it is important to keep wondering, says Dr. de Groot. In this way, A STEP IN THE RIGHT DIRECTION Professor Norman Sartorius, President of the World Psychiatric Associa opment of a part of the national mental health programme in which Lundbeck and Grenlandsaksjonen wil NATURAL CONSIDERATIONS We have a major responsibility for the internal and external environment in c changes without taking the necessary precautions, and the knowledge that a defective filter or an ov FOCUS ON PARKINSONS DISEASE Lundbeck works in two main areas. For this reason we describe ourselves refers to various theories about heredity, environmental impacts, head trauma, side-effects of drugs A PRODUCT WITH POTENTIAL There is broad agreement that the development of specific serotonin-reuptak and on their family and social relations. In fact, the quality of life of patients with phobias is j ITS ALL ABOUT PREVENTION In 1993, Lundbeck, working in close cooperation with some of the worlds lea Preclinical tests show that preparations like Serdolect®/Serlect® do not affect the part of the brai LUNDBECKS PRODUCTS Lundbeck specialises in the development of new and better drugs for the treatment In April 1997, we sold the rights to Ketogan® and Ketodur® to Searle Scandinavia (a division of Mons LUNDBECK WORLDWIDE Lundbecks head office is situated in Valby, near the centre of Copenhagen. It hou Norway H. Lundbeck A/S P.O. Box 361 Lysaker torg 10, N-1324 Lysaker Tel: +47 6753 5372 Fax: +47 6753 THE LUNDBECK FOUNDATION AWARD FOR OUTSTANDING RESEARCH H. Lundbeck A/S is fully owned by the Lundbec ACCOUNTS SUMMARY FOR THE GROUP 1987-1996 Profit and loss account (DKKm) Net turnover Profit before R&D co Key figures Average number of employees Net profit ratio before R&D costs (%) Net profit ratio ( COMMENTS ON THE ACCOUNTS CHANGES IN ACCOUNTING POLICIES With effect from the annual accounts for 199 3,000 2,750 2,500 2,250 2,000 1,750 1,500 1,250 1,000 750 500 250 0 Turnover (DKKm) Cipramil®/Sero COMMENTS ON THE ACCOUNTS 100% 90% 80% 70% 60% 18 26 20 22 23 36 35 34 33 Cost structure (%) 28 Pro 450 400 350 300 250 200 150 100 50 0 -50 -100 -150 Cash flow (DKKm) 281 282 231 191 203 164 145 98 FINANCIAL COMMENTS GENERAL The Lundbeck Groups financial income and expenses in 1996 were influenced Lundbecks cash flows in foreign currencies in 1996 were concentrated around SEK, FRF, FIM and DEM bl ACCOUNTING POLICIES GENERAL The annual accounts and the consolidated accounts have been prepared in THE BALANCE SHEET INTANGIBLE FIXED ASSETS Intangible fixed assets are stated at cost less accumulate Win Van Niel, Daoux Rex, bronze, 35 x 25 x 8 cm. 40 PROFIT AND LOSS ACCOUNT PARENT COMPANY 1995 DKKm 1,042.8 469.1 157.3 160.8 255.6 221.2 12.7 5.9 41.2 BALANCE SHEET AT 31 DECEMBER ASSETS PARENT COMPANY 1995 DKKm 21.0 11.0 32.0 312.3 97.2 112.2 114.0 6 BALANCE SHEET AT 31 DECEMBER LIABILITIES PARENT COMPANY 1995 DKKm 110.0 14.7 25.5 785.1 935.3 1996 D STATEMENT OF SOURCES AND APPLICATION OF FUNDS GROUP 1996 DKKm 310.8 5.0 84.3 400.1 -47.2 -78.4 78.0 SIGNATURES Copenhagen, 24 April 1997 THE Erik Sprunk-Jansen President BOARD OF MANAGEMENT Ib D. NOTES 1 NET TURNOVER PARENT COMPANY 1995 DKKm 282.2 760.6 1,042.8 1996 DKKm 263.0 1,150.7 1,413.7 De Production, distribution, administration, and research and development costs include depreciation et NOTES 4 FINANCIAL ITEMS, NET PARENT COMPANY 1995 DKKm 44.4 1.4 30.4 2.8 79.0 43.4 5.5 8.8 57.7 21.3 6 FOREIGN CURRENCY TRANSLATION OF SUBSIDIARIES PROFIT AND LOSS ACCOUNTS AT THE EXCHANGE RATE RULING NOTES 7 INTANGIBLE AND TANGIBLE FIXED ASSETS GROUP: Research and Leasehold INTANGIBLE development im 7 INTANGIBLE AND TANGIBLE FIXED ASSETS - CONTINUED PARENT COMPANY: Research and Leasehold INTANGIBLE NOTES 8 SHARES IN SUBSIDIARIES Total Purchase price 84.8 4.1 -115.5 145.8 88.9 56.1 -3.2 39.5 -18.7 8 SHARES IN SUBSIDIARIES - CONTINUED Specified as follows: Equity value at 31.12.1996 DKKm 1.6 57.0 NOTES 9 OTHER SHAREHOLDINGS AND OTHER RECEIVABLES PARENT COMPANY Other shareholdings 4.5 1.6 -0.7 5. 11 PROVISIONS FOR DEFERRED TAX Timing differences between amounts as stated in the accounts and as c NOTES 13 DEBT PARENT COMPANY 1995 DKKm 378.2 27.7 141.7 547.6 10.3 11.7 22.0 569.6 18.2 84.5 0.0 50. 14 CHANGE IN INTEREST-BEARING DEBT GROUP 1996 DKKm Proceeds in connection with the raising of intere Marjanne Voolstra, Eerste berg, acrylic paint on paper, 100 x 70 cm. 58 INTEGRATED THERAPY When disease strikes, it is not just a case of a fault in the works that has to b The story of Lundbecks logo is rather unusual. It goes back to the 1930s and Paris, where Grete Lund