Recipharm Annual Report 2006

ANNUAL REPORT
AND
CONSOLIDATED ACCOUNTS
FOR
Recip Pharma AB
Corporate Identity Number 556498-8425
Contents Page
- Administration Report 1
- Consolidated Income Statement 7
- Consolidated Balance Sheet 8
- Consolidated Cash Flow Statement 10
- Parent Company Income Statement 11
- Parent Company Balance Sheet 12
- Parent Company Cash Flow Statement 14
- Supplementary Disclosures, Group and Parent Company 15
- Signatures 29

Recip AB 2006
Administration Report
The Board of Directors and Managing Director hereby submit the annual report and
consolidated accounts for the financial year 1 January 2006 – 31 December 2006.
Group structure
The Recip Group, with Recip Pharma AB as the Parent Company (formerly Recip AB), is a
wholly-owned sub-group of Backsell-Eldered AB, Corporate Identity Number 556510-1879,
with its registered offices in Stockholm. The consolidated accounts have been prepared partly
by Recip Pharma AB with subsidiary, and partly by Backsell-Eldered AB for the entire
Group.
Market and sales
The Group’s consolidated sales increased by 10% to MSEK 918.7 (MSEK 835.2). Sales in
Sweden increased by 11% to MSEK 803.7 (MSEK 723.5) and comprised 87% (87%) of sales.
The Group’s own products comprised 47% (44%) of sales and contract transactions accounted
for the remaining portion.
Own products
Sales of the Group’s own products increased during the year by 20% and amounted to MSEK
428.4 (MSEK 355.9). During 2006, several products were acquired from Pfizer. Through
these acquisitions, Recip gained the rights to trademarks, pharmaceutical registrations and
other product rights, primarily related to the Swedish and Norwegian markets. The acquisition
contributed to an increase in sales for the Group’s own products. Towards the end of the year,
agreements were entered into for additional purchases of product rights from two different
Danish companies. These acquisitions have only had a marginal impact on the Group’s results
for 2006.
The Group’s five largest own products in 2006 included Kalcipos, Laktulos, Mitt Val, Triobe
and Visiblin. Sales for the five largest own products comprised 53% (65%) of the total sales
of own products.
Contract transactions
Sales related to contract transactions increased by 2% to MSEK 489.9 (MSEK 479.3). These
sales do not include internal sales of own products. During the year, several products
previously included in contract transactions were acquired and, thereby, are now own
products. The increase in sales, excluding such acquisitions, was slightly more than 2%.
During the year, work has been expended on a number of projects which are expected to lead
to considerable sales. Several of these projects have involved not insignificant revenue from
services in connection with preparations for ongoing production.
Production
The Group’s production operations are organised into four separate companies which each
run pharmaceutical production with a focus on different forms of preparations. Recip
Stockholm AB, with facilities in Stockholm and Haninge is focused on solid preparation
forms, primarily pills. Recip Höganäs AB is also focused on solid preparations, primarily in

the form of powders and granulates, including pharmaceutical products with dietary fibres as
the main ingredient. Recip Strängnäs AB is entirely focused on penicillin products. Semisolid
preparations, including creams, ointments and gels are produced by Recip Karlskrona
AB. All of the facilities are modern and easily meet the requirements of government
authorities and customers. During the year, investments have primarily been related to
replacements and some minor expansions, primarily in Recip Stockholm AB.
International organisation
A complete marketing unit, including a local manager, product manager and product
specialists, is run in Norway. This operation is run as a branch of Recip AB and has six
employees. During the year, a sales unit with one employee was opened in the United
Kingdom. This unit is also operated as a branch of Recip AB. The operations in the UK are
primarily focused on business development and sales of contract transactions. In the United
States, there is a subsidiary which sells ThyroSafe on the American market. This company has
not had any employees during 2006. In other countries, the Group’s products are sold through
agents and distributors and, in certain cases, directly by Recip AB. During the year, measures
were undertaken to open own marketing and sales companies in Denmark and Finland during
2007.
Net sales and results
During the financial year, the Group’s net sales amounted to MSEK 918.7 (835.2), an
increase of MSEK 83.5, or approximately 10%. This increase thereby corresponds with the
Group’s aim of a growth rate of 10%.
The operating margin in the Group during the financial year amounted to 9.7% (8.4), which is
somewhat lower than the long-term goal for the Group of 10%.
Profit/loss after financial items for the Group amounted to MSEK 84.7 (65.7), an
improvement of MSEK 19.0, or approximately 29%.
Profitability, calculated as the return on capital employed, amounted to 24% (29) for the
Group, which exceeds the long-term goal of a return of 20% on capital employed.
Operating profit/loss for the Group was distributed over the various units as follows:
2006 2005 2004 2003
Recip Pharma AB, Sweden -110.0 -22.9 68.2 44.6
Recip Läkemedel AB 116.9 63.9
Recip Karlskrona AB 22.2 12.1 -4.6
Recip Stockholm AB 44.1 22.9
Recip Strängnäs AB 2.8 3.8
Recip Höganäs AB 2.1 -2.6
Recip NUF, Norway 3.4 -3.9 -4.3 -4.5
Recip Inc., USA 0.5 0.1 0.6 -0.6
Other subsidiaries and eliminations 7.5 -3.6 0.4 -0.5
Consolidated operating profit/loss 89.5 69.8 60.3 39.0

Liquidity and cash flow
The Group’s unappropriated cash and cash equivalents, including the unutilised portion of the
granted bank overdraft facilities, amounted to MSEK 152.9 (91.9) as per 31 December 2006.
Apart from equity of MSEK 227.1 (174.9), the Group’s operations are partly financed by
long-term borrowings of MSEK 149.6 (63.6), and partly by a granted bank overdraft facility
of MSEK 75.0 (75.0).
Cash flow for the Group has been impaired and amounted to MSEK 19.4 (67.5) for the
financial year. This amount includes MSEK 42.2 (167.9) from operating activities, MSEK -
63.6 (-99.0) from investing activities and MSEK 40.7 (-1.4) from financing activities.
At the end of the financial year, the Group’s equity/assets ratio amounted to 28% (30), which
is lower than the Group’s long-term goal of 40%. The debt/equity ratio for the group
amounted to 0.5 (0.3), which is less than the long-term goal of 0.6.
Investments
The Group’s gross investments in tangible fixed assets amounted to MSEK 14.2 (19.8) for the
financial year. Of these investments, MSEK 10.9 (17.1) referred to investments in machinery
and equipment, MSEK 2.8 (2.4) to constructions in progress and MSEK 0.5 (0.4) to costs of
improvements in property not owned by the Group. The Group’s gross investments in product
rights amounted to MSEK 183.9 (76.7) for the financial year.
Summary covering several years
2006 2005 2004
Net sales, MSEK 918.7 835.2 602.9
Operating profit/loss, MSEK 89.5 69.8 60.3
Profit/loss after financial items, MSEK 84.7 65.7 58.6
Profit for the year, MSEK 71.2 49.2 43.4
Fixed assets, MSEK 302.9 173.5 105.2
Current assets, MSEK 495.3 404.9 285.2
Equity, MSEK 227.1 174.9 142.5
Provisions 30.3 20.1 14.5
Long-term liabilities, MSEK 169.8 71.7 52.2
Short-term liabilities, MSEK 371.0 311.7 181.3
Balance sheet total, MSEK 798.2 578.4 390.4
Operating margin, % 9.7 8.4 10.0
Return on capital employed, % 24 29 33
Equity/assets ratio, % 28 30 36
Debt/equity ratio 0.5 0.3 0.4
Number of employees 570 572 435
Refer to the section on accounting principles and the notes below for definitions of terms.

Research and development
Recip’s development activities are focused on the pharmaceutical and clinical development of
new products, as well as the further development of existing products and processes for
greater customer benefit and efficiency. Product development and the development of
production processes are expensed on an ongoing basis. R&D costs amounted to MSEK 23.9
(MSEK 25.1).
Environment
Our vision is for Recip to set an example from an environmental perspective. Environmental
work is important for Recip and forms an integrated part of daily work.
To support this work with environmental improvement, Recip has an environmental
management system covering both the working environment and the external environment.
This system is certified in accordance with ISO14001, OHSAS18001 and the Swedish Work
Environment Authority’s Statute Book (AFS) 2001:1.
The impact of the Recip Group on the external environment is assessed as primarily
attributable to carbon dioxide emissions from transport, the consumption of natural gas and
the production of steam; the discharge of waste from production and laboratory operations;
the discharge of solvents into the air, as well as the indirect environmental impact of hired
suppliers.
Recip’s production facilities, except for the one in Haninge, are subject to regulation in
accordance with the Environmental Code. The facilities in Strängnäs, Årsta and Karlskronga
conduct activities requiring a permit in accordance with the Swedish Ordinance Concerning
Environmentally Hazardous Activities and the Protection of Public Health (SFS 1998:899),
24.42-1, “factory for manufacture of pharmaceuticals with mechanical processes only”, under
Level of Authority B.
The facility in Höganäs conducts activities requiring a permit in accordance with the Swedish
Ordinance Concerning Environmentally Hazardous Activities and the Protection of Public
Health (SFS 1998:899), 24.41-4, “factory for manufacture of pharmaceuticals or natural
medicines by extraction from biological materials”, under Level of Authority B.
The facility in Haninge only conducts the packaging of pharmaceuticals and, consequently, is
not subject to authorisation under the Swedish Environmental Code.
No injunctions of an environmental nature or similar had been received from any authority by
year-end. During the year, the Company has complied with the conditions of all granted
authorisations.
The Company deems that no environmental liabilities requiring future decontamination have
arisen.
Recip’s Sustainability Report is available to interested parties. This document reviews the
Company’s work and performance as regards the working environment and social issues, the
environment and finances.

Personnel
The average number of employees in 2006 amounted to 570 (572), a decrease of 0.3%.
Women comprised 60% (62%) of the personnel.
Recip has been certified for many years in accordance with AFS 2000:1 and OHSAS 18001
regarding the work environment.
For additional personnel-related information, please refer to Note 4.
Work of the Board of Directors
At the Annual General Meeting for 2006, all five members of the Board were re-elected. All
members of the Board of Directors are men. The Board of Directors has held five regular
meetings during the year.
Significant events during the financial year or after the end of the financial year
After the end of the accounting period, Recip Pharma AB changed its name from Recip AB.
In conjunction with this, all marketing and sales operations were transferred to a new
subsidiary in the Group. This company, hereafter, changed its name to Recip AB. The new
Recip AB has overall responsibility for all marketing and sales activities in all countries and is
also the Parent Company of the marketing companies in the Nordic region.
Prospects for 2007 and risk analysis
In addition to organic growth in the existing business, a number of ongoing projects regarding
contract transactions, the full-year effect of implemented acquisitions of product rights and
the establishment of Company-owned sales organisations in Denmark and Finland, taken as a
whole, are expected to entail continued solid increases in sales during the financial year 2007.
The Group is not deemed to be exposed to any particular risks that may impact operations in a
decisive manner, apart from purely cyclical or business-related risks. However, it can be
stated that the impact of changed regulations regarding such matters as the pricing of
pharmaceuticals may be of decisive significance. As the Swedish portion of sales is dominant,
the impact of amended regulations in Sweden is particularly large. However, such changes
may entail both risks and opportunities for the Group. Sales to the most significant customers
constitute a highly significant portion of contract transactions. However, sales are divided into
a number of separate agreements with various commitment periods.
Parent Company
Operations
The Company pursues the environmentally-aware development, manufacture and sales of
pharmaceuticals, naturopathic preparations, dietary supplements, medical aids and associated
operations.
Ownership
The Company is a wholly-owned subsidiary of Backsell-Eldered AB, Corporate Identity
Number 556510-1879, with its registered offices in Stockholm, which prepares the
consolidated accounts for the largest group.

Investments
Gross investments for the year amounted to MSEK 163.2 (96.9). Of these, an amount of
MSEK 159.3 (76.7) refers to investments in product rights and MSEK 3.9 (9.3) refers to
investments in machinery and equipment.
Significant events during the financial year or after its end
During the financial year, product rights of a book value of MSEK 127.6 have been
transferred to one of the Group's subsidiaries.
Following year-end, the name of the Parent Company, Recip AB, was changed to Recip Pharma
AB. In conjunction with this, the entire marketing and sales operation was transferred to a newlystarted
subsidiary of the Group. This company subsequently changed its name to Recip AB. The new
Recip AB bears overall responsibility for all marketing and sales activities in all countries and is also
Parent Company of the marketing company in the Nordic region.
Net sales and financial result
Net sales for the financial year amounted to MSEK 135.5 (254.4), a decrease of MSEK 118.9 or
approximately 46.7%. Profit/loss after financial items amounted to MSEK -146.6 (545.7) for the year.
The figures for the comparative year should be considered in the light of the fact that major portions
of Recip AB’s operations were transferred to several different Group subsidiaries during the period
January – May 2005. Furthermore, profit/loss after financial items for the comparative year included
a capital gain from the inter-company sale of subsidiaries in an amount of MSEK 574.9.
Liquidity and financing
The Company's cash and cash equivalents amounted to MSEK 48.3 (16.5) per 31 December 2006.
The possibility of utilisation of the Group's approved bank overdraft facility, of an amount of MSEK
75.0 (75.0), can be added to this.
Cash flow
Total cash flow amounted to MSEK 32.8 (5.3). Cash flow from operating activities amounted to
MSEK -59.5 (85.2) for the financial year. Of this amount, MSEK -29.4 (90.6) referred to investing
activities and MSEK 121.7 (10.6) to financing activities.
Appropriation of profits
The following profits in the Parent Company are at the disposal of the Annual General Meeting.
Profit brought forward 740,372,716
Loss for the year - 118,029,797
Total 622,342,919
The Board of Directors proposes that the profits brought
forward be distributed as follows:
as a dividend to the shareholders, SEK 3 per share 30,000, 000
to be carried forward 592,342,919
Total 622,342,919
Group
According to the consolidated balance sheet, non-restricted equity amounts to SEK 137,148,185.
Regarding the Group's result of operations, no provisions to restricted reserves are proposed.

CONSOLIDATED
INCOME STATEMENTS
Note
1 Jan 2006
31 Dec 2006
1 Jan 2005
31 Dec 2005
Operating income, etc.
Net sales 918,686,689 835,234,323
Other operating income 7,137,124, 3,930,183
925,823,813 839,164,506
Operating expenses
Raw materials and consumables -285,892,766 -254,673,736
Other external expenses 2, 3 -199,275,853 -189,375,973
Personnel costs 4 -299,748,784 -291,940,840
Depreciation of tangible and amortisation of
Intangible non-current assets 7,8,9,10,11 -44,909,787 -30,391,178
Loss on disposal of tangible and intangible
fixed assets -563,758 -
Other operating expenses 5 -5,919,619 -3,025,299
-836,310,567 -769,407,026
Operating profit/loss 89,513,246 69,757,480
Result from financial items
Other interest income and similar profit/loss items 1,206,933 465,039
Interest expenses and similar profit/loss items -5,986,890 -4,530,600
-4,779,957 -4,065,561
Profit/loss after financial items 84,733,289 65,691,919
Tax on profit for the year 6 -13,491,248 -16,517,343
Net profit/loss for the year 71,242,041 49,174,576

CONSOLIDATED
BALANCE SHEETS
ASSETS Note 31 Dec 2006 31 Dec 2005
Fixed assets
Intangible fixed assets
Product rights 7 232,014,452 83,713,758
Other intangible fixed assets 8 5,593,633 7,872,950
237,608,085 91,586,708
Intangible fixed assets
Land and buildings 9 1,379,605 1,435,200
Improvement expenses for other parties’ property 10 3,146,944 4,325,261
Machinery and equipment 11 56,923,146 65,311,608
Constructions in progress 12 2,791,254 2,403,136
64,240,949 73,475,205
Financial fixed assets
Other investments held as fixed assets 154,710 92,980
Other long-term receivables 15 0 6,321,115
Deferred tax assets 16 893,696 2,065,002
1,048,406 8,479,097
Total fixed assets 302,897,440 173,541,010
Current assets
Inventories
Raw materials and consumables 69,854,144 64,269,289
Products in process 24,878,802 26,056,904
Finished products and goods for resale 74,087,756 67,475,079
168,820,702 157,801,272
Current receivables
Accounts receivable - trade 137,883,843 98,996,957
Income taxes recoverable 66,732,950 24,527,345
Other receivables 6,424,656 29,361,753
Prepaid expenses and accrued income 17 16,212,027 13,308,522
227,253,476 166,194,577
Cash and bank balances 18 99,180,124 80,869,580
Total current assets 495,254,302 404,865,429
TOTAL ASSETS 798,151 742 578,406,439

CONSOLIDATED
BALANCE SHEETS
EQUITY AND LIABILITIES
Equity
Note 31 Dec 2006 31 Dec 2005
19
Restricted equity
Share capital (10,000,000 shares) 10,000,000 10,000,000
Restricted reserves 79,903,072 53,645,786
89,903,072 63,645,786
Non-restricted equity
Non-restricted reserves 65,906,144 62,047,040
Net profit/loss for the year 71,242,041 49,174,576
137,148,185 111,221,616
Total equity 227,051,257 174,867,402
Provisions
Deferred income tax liabilities
30,287,862 20,076,695
Total provisions 30,287,862 20,076,695
Long-term liabilities
21
Liabilities to credit institutions 149,552,234 63,566,666
Other long-term liabilities 20,227,304 8,157,796
Total long-term liabilities 169,779,538 71,724,462
Current liabilities
Overdraft facility (credit limit 75 MSEK (75
MSEK))
18 21,227,759 62,958,329
Accounts payable - trade 184,269,597 119,901,412
Liabilities with Parent Company 0 23,333,332
Income tax liabilities 134,177 0
Other current liabilities 118,677,715 23,503,194
Accrued expenses and deferred income 22 46,723,837 82,041,613
Total current liabilities 371,033,085 311,737,880
TOTAL EQUITY AND LIABILITIES 798,151,742 578,406,439
Pledged assets 24 117,400,000 117,400,000
Contingent liabilities None None

CONSOLIDATED
CASH FLOW STATEMENTS 1 Jan 2006 1 Jan 2005
Note 31 Dec 2006 31 Dec 2005
Operating activities
Profit/loss after financial items 84,733,289 65,691,919
Adjustment for items not included in the cash flow 23 50,069,689 29,060,847
Income tax paid -46,634,102 -28,071,449
Net cash from operating activities
before changes in working capital
88,168,876 66,681,317
Changes in working capital
Decrease(+)/increase(-) in inventories -14,319,990 -27,134,821
Decrease(+)/increase(-) in receivables -13,565,638 -931,213
Decrease(-)/increase(+) in current liabilities -18,033,443 129,289,180
Cash flow from operating activities 42,249 805 167,904,463
Investing activities
Acquisition of tangible fixed assets 10,11,12 -16,967,377 -19,779,422
Acquisition of intangible fixed assets 7 -66,501,404 -79,440,100
Acquisition of financial fixed assets -4,568 -1,761,708
Disposals of fixed assets 7.11 19,909,318 1,970,759
Cash flow from investing activities
-63,564,031 -99 010,471
Financing activities
Long-term borrowings 75,597,369 19,561,289
Dividends paid -16,000,000 -6,000,000
Group contribution paid -18,888,889 -14,965,000
Cash flow from financing activities 40,708,480 -1,403,711
Change in cash and cash equivalents 19,394,254 67,490,281
Cash and cash equivalents at beginning of year 80,869,580 12,813,593
Exchange rate differences in cash and cash
equivalents -1,083,710 565,706
Cash and cash equivalents at end of year 99 180,124 80,869,580

PARENT COMPANY
INCOME STATEMENTS
Note
1 Jan 2006
31 Dec 2006
1 Jan 2005
31 Dec 2005
Operating income, etc.
Net sales 1 135,506,635 254,422,035
Other operating income 6,000,270 3,724,343
141,506,905 258,146,378
Operating expenses 1
Raw materials and consumables -66,614,327 -72,932,611
Other external expenses 2, 3 -73,989,849 -92,640,276
Personnel costs 4 -78,733,178 -106,173,966
Depreciation of tangible and amortisation of
Intangible non-current assets 7,8,9,10,11 -23,192,909 -11,610,278
Loss on disposal of tangible
fixed assets -456,316 0
Other operating expenses 5 -5,130,194 -1,636,867
-248,116,773 -284,993,998
Operating profit/loss -106,609,868 -26,847,620
Result from financial items
Result from participations in Group companies -38,000,000 574,900,000
Other interest income and similar profit/loss items 758,535 195,087
Other interest income from Group companies 2,034,956 826,432
Interest expenses and similar profit/loss items -4,817,410 -2,752,915
Interest expenses to Group companies 0 -612,669
-40,023,919 572,555,935
Profit/loss after financial items -146,633,787 545,708,315
Appropriations
Transfer to tax allocation reserve 0 -7,900,000
Reversal from tax allocation reserve 2,804,299 4,651,946
Change of accelerated depreciation -4,051 , 647. -5,256,596
-1,247,348 -8,504,650
Profit/loss before taxes -147,881,135 537,203,665
Tax on profit for the year 6 29,851,338 9,554,257
Net profit/loss for the year -118,029,797 546,757,922

PARENT COMPANY
BALANCE SHEETS
ASSETS
Fixed assets
Note 31 Dec 2006 31 Dec 2005
Intangible fixed assets
Product rights 7 71,722,884 71,713,758
Other intangible fixed assets 8 5,593,633 7,872,950
77,316,517 79,586,708
Tangible fixed assets
Land and buildings 9 914,507 954,046
Improvement expenses for other parties’ property 10 334,998 370,844
Machinery and equipment 11 8,426,277 9,306,273
9,675,782 10,631,163
Financial fixed assets
Participations in Group companies 13 579,755,545 579,632,620
Receivables from Group companies 14 223,000,000 0
Other investments held as fixed assets 154,710 92,980
Other long-term receivables 15 0 6,321,115
802,910,255 586,046,715
Total fixed assets 889,902,554 676,264,586
Current assets
Inventories
Finished products and goods for resale 6,834,201 3,254,687
6,834,201 3,254,687
Current receivables
Accounts receivable - trade 15,807,566 13,229,441
Receivables from Group companies 157,530,476 246,671,319
Income taxes recoverable 39,246,746 3,538,411
Other receivables 5,654,944 20,208,076
Prepaid expenses and accrued income 17 5,068,364 3,871,586
223,308,096 287,518,833
Cash and bank balances 18 48,289,841 16,483,250
Total current assets 278,432,138 307,256,770
TOTAL ASSETS 168,334,692 983,521,356

PARENT COMPANY
BALANCE SHEETS
EQUITY AND LIABILITIES
Equity
Note 31 Dec 2006 31 Dec 2005
19
Restricted equity
Share capital (10,000,000 shares) 10,000,000 10,000,000
Statutory reserve 2,000,000 2,000,000
12,000,000 12,000,000
Non-restricted equity 740,372,716 131,658,065
Profit brought forward -118,029,797 546,757,922
Net profit/loss for the year 622,342,919 678,415,987
Total equity
634,342,919 690,415,987
Untaxed reserves 20
Tax allocation reserve 38,222,218 41,026,517
Accumulated depreciation in excess of plan 22,893,405 18,841,758
Total untaxed reserves 61,115,623 59,868,275
Long-term liabilities 21
Liabilities with credit institutions 114,991,329 48,566,666
Liabilities with Group companies 85,650,000 0
Other long-term liabilities 18,477,500 1,306,453
Total long-term liabilities 219,118,829 49,873,119
Current liabilities
Overdraft facility (credit limit MSEK 75
(MSEK 75))
18 0 40,712,799
Accounts payable - trade 130,076,296 56,989,526
Liabilities with Group companies 11,030,007 7,060,142
Liabilities with Parent Company 0 23,333,332
Other current liabilities 94,086,591 3,952,698
Accrued expenses and deferred income 22 18,564,427 51,315,478
Total current liabilities 253,757,321 183,363,975
TOTAL EQUITY AND LIABILITIES 1 168,334,692
983,521,356
Pledged assets 24 102,400,000 102,400,000
Contingent liabilities
Guarantee, Recip Karlskoga Fastighets AB, Corporate Identity Number 556657-8315.

PARENT COMPANY
CASH FLOW ANALYSES
Operating activities
Note 1 Jan 2006
31 Dec 2006
1 Jan 2005
31 Dec 2005
Profit/loss after financial items -146,633,787 545,708,315
Adjustment for items not included in the cash flow 23 56,676,589 -567,852,586
Income tax paid -173,870 -6,419,270
Cash flow from operating activities
before changes in working capital -90,131,068 -28,563,541
Changes in operating capital
Decrease(+)/increase(-) in inventories -3,579,514 96,977,168
Decrease(+)/increase(-) in receivables 25 33,031,816 -112,723,099
decrease(-)/increase(+) in current liabilities 25 1,192,587 129,531,598
Cash flow from operating activities
-59,486,179 85,222,126
Investing activities
Acquisition of subsidiaries 13 -122,925 -575,344,070
Disposals of subsidiaries 0 575,091,000
Acquisition of tangible fixed assets 10.11 -6,647,061 -9,611,484
Acquisition of intangible fixed assets 7 -41,928,029 -79,440,100
Acquisition of financial fixed assets 0 -1,761,708
Disposals of intangible and tangible
fixed assets 7,11,25 19,265,838 481,254
Cash flow from investing activities
Financing activities
-29,432,177 -90,585,108
Long-term borrowings 66,424,663 31,597,413
Dividend paid -16,000,000 -6,000,000
Group contributions received/paid 71,251,111 -14,965,000
Cash flow from financing activities
121,675,774 10,632,413
Change in cash and cash equivalents 32,757 418 5,269,431
Cash and cash equivalents at beginning of year 16,483,250 10,745,088
Exchange rate difference in cash and cash
equivalents -950,827 468,731
Cash and cash equivalents at end of year 48 289,841 16,483,250

SUPPLEMENTARY DISCLOSURES
GENERAL DISCLOSURES
Accounting principles
The accounting principles applied are in accordance with the Swedish Annual Accounts Act and the general
advice and guidelines of the Swedish Accounting Standards Board. Any deviations are specified in the notes
below. The accounting principles remain unchanged compared with the previous year.
Valuation principles, etc
Assets, provisions and liabilities are valued at acquisition cost, unless otherwise stated below.
Receivables
Receivables are reported in the amounts that they are estimated to be received. Foreign receivables and
liabilities have been recorded at the closing rate of exchange.
Inventories
Inventories are valued at the average acquisition or manufacturing cost for the year, although not at a rate
higher than the market value.
Revenue recognition
Revenue recognition takes place when the material risks and benefits associated with the company’s
goods are transferred to the purchaser.
Tax
The Company applies the Swedish Financial Accounting Standards Council's recommendation RR9, Income Tax. Total
tax consists of current tax and deferred tax. Taxes are reported in the income statement except when the underlying
transaction is reported directly against equity, in which case accompanying tax effects are reported in equity. Current
tax (previously Income Tax Paid) is tax to be paid or received for the current year, including adjustments of current
taxes attributable to previous periods. Deferred tax is calculated in accordance with the balance sheet method, taking,
as its basis, temporary differences between the carrying amounts and fiscal values of assets and liabilities. These
amounts are calculated on the basis of the manner in which the temporary differences are expected to be settled and by
using tax rates and tax rules adopted or announced on balance sheet date. Deferred tax assets attributable to deductible
temporary differences and loss carry-forwards are recognised only to the extent it is likely that they will result in
lower tax payments in the future.
Group contributions
Group contributions are reported in accordance with the statements of the Financial Accounting Standards
Council’s Emerging Issues Task Force (URA 7). Group contributions are reported according to their economic
significance, namely by minimising the Group's total tax. As Group contributions do not, therefore, constitute
compensation for performance, these are reported directly against profit brought forward after deduction of
their tax effects.
Leasing
Financial lease agreements, which substantially transfer to the Company all the risks and benefits of the leased asset
associated with ownership, are reported as assets in the consolidated balance sheet statement from the date on which
the agreement is entered. The assets are then valued at the fair value of the leased object or at the present value of the
minimum leasing fees for the period of the lease, if this is lower. The payment of leasing fees is divided into financial
expenses and reduction (repayment of borrowings) of the financial liability, so that a constant interest rate is achieved
on the accounted liability. These financial expenses are charged to profit/loss.
Assets under financial leasing agreements are depreciated over the shorter period of estimated useful life or the
duration of the leasing agreement.
Leasing agreements substantially transferring all risks and benefits associated with ownership to the lessor are classified
as operational leasing agreements. Leasing fees from operational leasing agreements are reported as expenses in the
income statement and are allocated on a straight-line basis over the duration of the agreement.
In the Parent Company, all leasing agreements are classified as operational leasing agreements.

Depreciation/amortisation principles for fixed assets
Fixed assets are reported at acquisition value, less accumulated depreciation/amortisation.
Depreciation/amortisation is performed systematically over the asset's expected useful life, according to the
schedule below:
Fixed assets Useful life
Product rights 9 - 10 years
Other intangible fixed assets 5 years
Machinery and equipment 3- 8 years
Buildings 25 years
Improvement expense for other parties’ property 8 - 1 0 years
Consolidated accounts
The consolidated accounts have been prepared according to the Swedish Financial Accounting Standards Council's
recommendation RR 1:00, using the purchase method. The Group's equity comprises the Parent Company's equity
and that portion of the subsidiaries’ equity arising after these companies have been acquired. In addition to the
Parent Company, the consolidated accounts include all companies in which the Parent Company, directly or
indirectly, owns more than 50 percent of the votes or, in any other manner, has control in accordance with Swedish
Annual Accounts Act, 1:4.
Translation of foreign subsidiaries
The annual accounts of foreign subsidiaries are translated into SEK in accordance with the current method. The current
method implies that all assets, provisions and other liabilities are translated to the exchange rate prevailing at balance
sheet date and that all items in the income statement are translated at the average exchange rate for the year. Accrued
translation differences are reported directly against equity.
Definitions
Operating margin Operating profit/loss in relation to net sales
Capital employed Total balance sheet total less non-interest-bearing liabilities and provisions
Return on capital employed Operating income plus interest income in relation to average capital employed
Equity/assets ratio Equity in relation to balance sheet total.
Debt/equity ratio Interest-bearing liabilities less cash and cash equivalents in relation to equity

DISCLOSURES FOR INDIVIDUAL ITEMS
Note 1 Purchases and sales within the Group and related party transactions
PARENT COMPANY 2006 2005
Sales to Group companies 26,656,663 32,673,078
Purchases from Group
companies
91,262,325 36,523,341
The Group rents factory and office premises in Haninge from KB Titania, which is an associated company.
The annual fee for 2006 amounts to MSEK 11.
Note 2 Operating leases
GROUP 2006 2005
Leasing charges for the
financial year
956,181 0
Estimated fees, 2007 346,00 0
Estimated fees, 2008 0 0
Estimated fees, 2009 0 0
Estimated fees, 2010 0 0
Estimated fees, 2011 0 0
Operating leases
PARENT COMPANY
2006 2005
Leasing charges for the
financial year
6,320,834 0
Estimated fees, 2007 5,316,660 5,286,660
Estimated fees, 2008 0 1,762,220
Estimated fees, 2009 0 0
Estimated fees, 2010 0 0
Estimated fees, 2011 0 0
Financial leases
GROUP 2006 2005
Leasing charges for the
financial year
2,242,601 0
Estimated fees, 2007 2,017,994 1,842,887
Estimated fees, 2008 1,842,887 1,831,668
Estimated fees, 2009 1,831,668 1,831,668
Estimated fees, 2010 1,831,668 1,831,668
Estimated fees, 2011 1,831,668 0

Note 3 Fees and remuneration for audit
GROUP 2006 2005
Ernst & Young AB
1,420,092 562,460
Audit assignment 90,000 118,000
Other assignments 1,510,092 680,460
PARENT COMPANY 2006 2005
Ersnt & Young AB
1,430,092 300,000
Audit assignment 90,000 118,000
Other assignments 1,520,092 418,000
Note 4 Personnel
Average number of employees
The average number of employees is based on attendance hours, paid by the Company, in relation to standard
working hours.
GROUP 2006 2005
Average number of employees 570 572
of whom women 342 354
PARENT COMPANY 2006 2005
Average number of employees 85 82
of whom women 52 49
Absence due to illness
Absence due to illness as a percentage of standard working hours
GROUP
Number of employees Absence due to illness, % Of which >60 days, %
Year, Age Men Women Men Women Men Women
2006, < 29 30 17 4.8 10.9 14.1 50.1
2005, < 29 29 30 5.7 15.5 17.5 77.4
2006, 30-49 128 205 3.7 7.2 35.2 48.1
2005, 30-49 121 190 3.7 21.6 42.2
2006, > 50 70 120 4.8 8.4 55.5 68.3
2005, > 50 68 134 5.4 92.5 82.2
Total, 2006 228 342 4.2 7.8 39.2 55.7
Total, 2005 218 354 4.5 8.6 46.7 64.0

PARENT COMPANY 2006 2005
Absence due to illness for all employees 2.32% 4.37%
Proportion of absence due to illness referring to longterm
absences
27.59% 58.40%
Absence due to illness for women 3.34% 5.25%
Absence due to illness for men 0.73% 3.32%
Absence due to illness for personnel 29 years and
younger
0.00%
8.17%
Absence due to illness for personnel 30-49 years 3.45% 2.94%
Absence due to illness for personnel 50 years and older 0.89% 5.40%
Salaries, other remuneration and social security contributions
Salaries, remuneration, social security contributions and pension
costs have been paid in the following amounts:
GROUP 2006 2005
Board of Directors, Managing
Director and Vice Managing
Director
Other employees:
Salaries and remuneration 5,981,305 6,140,649
Pension costs 1,545,863 1,072,554
7,527,168 7,213,203
Salaries and remuneration 190,633,736 187,578,757
Pension costs 15,515,101 14,349,733
206,145,837 201,928,490
Social security contributions 68,024,327 66,961,516
- -
Total, Board and others 281,697,332 276,103,209
PARENT COMPANY 2006 2005
Board of directors, Managing
Director and Vice Managing
Director 2,798,321 3,601,180
Salaries and remuneration 627,240 634,462
Pension costs 3,425,561 4,235,642
Other employees: 44,042,627 59,107,421
Salaries and remuneration 5,765,731 8,011,697 ,
Pension costs 49,808,358 67,119,118
Social security contributions 16,420,310 22,726,374
- -
Total, Board and others 69,654,229 94,081,134

The Norwegian branch stands for SEK 2,926,511 (5,225,614) of total salaries and other
remuneration.
Pension commitments to the Board of Directors,
Managing Director and vice Managing Director 0 0
Senior management
GROUP 2006 2005
Number of Board Members, incl. Managing
Director
46 43
of whom women 10 10
Number of other members of senior management 27 30
of whom women 10 10
PARENT COMPANY 2006 2005
Number of Board Members, incl. Managing
Director
7 7
of whom women 0 0
Number of other members of senior management 5 6
of whom women 1 1
Note 5 Other operating expenses
GROUP
Exchange losses on receivables/liabilities
2006 2005
relating to operations -5,919,619 -3,025,299
PARENT COMPANY 2006 2005
Exchange losses on receivables/liabilities
relating to operations -5,130,194 -1,636,867
Note 6 Tax on profit for the year
GROUP
2006 2005
Current tax -708,775 -7,528,269
Deferred tax referring to temporary differences -1,171,306 501,735
Deferred tax, untaxed reserves -10,211,167 -5,601,920
Tax on Group contributions -1,400,000 -3,888,889
-13,491 248 -16,517,343
Difference between tax according to current tax rates and actual tax

Tax according to Parent Company's current tax
rate, 28%
Reported profit before taxes
84,733,290 65,691,919
Tax revenue/ tax expense -23,725,321 -18,393,745
Tax effect of non-deductible expenses -1,008,967 -2,067,601
Tax effect of non-taxable income 10,904,093 4,591,915
Tax revenue -418,727 0
Corrections from previous assessment period -94,662 0
Change in temporary differences 852,336 -647,922
Current tax expense (28%) -13,491,248 -16,517,353
PARENT COMPANY 2006 2005
Current tax -94,662 -6,659,987
Deferred tax referring to temporary differences 0 -1,563,267
Tax on Group contributions 29,946,000 17,777,511
29,851,338 9,554 257
Difference between tax according to current tax rates and actual tax
Reported profit/loss before taxes
Tax according to Parent Company's current tax
rate, 28%
Tax revenue / Tax expense
-147,881,135
537,203,665
41,406,718 -150,417,026
Tax effect of non-deductible expenses -11,301,861 -1,115,242
Tax effect of non-taxable income 65,142 162,649,793
Tax revenue -223,999 0
Corrections from previous assessment period -94,662 0
Change in temporary differences 0 -1,563,268
Current tax expense (28%) 29,851,338 9,554,257
Note 7 Product rights
GROUP
31 Dec 2006
31 Dec 2005
Opening acquisition cost 113,022,100 36,282,000
Purchases 183,854,125 76,740,100
Sales/disposals -14,583,126 0
Closing accumulated acquisition cost 282,293,099 13,022,100
Opening amortisation -29,308,342 -22,782,000
Sales/disposals 0 0
Amortisation for the year -20,970,305 , 6,526,342
Closing accumulated amortisation -50,278,647 -29,308,342
Book value 232,014,452 83,713,758
Amortisation according to plan is estimated according to a useful lifetime of 9 - 10 years.

PARENT COMPANY
31 Dec 2006
31 Dec 2005
Opening acquisition cost 98,022,100 36,282,000
Purchases 159,280,750 76,740,100
Sales/disposals -157,594,818 0
Acquisition value via transfer of assets and
liabilities
0 -15,000,000
Closing accumulated acquisition cost 99,708,032 98,022,100
Opening amortisation -26,308,342 -22,782,000
Sales/disposals 15,409,969 0
Accumulated amortisation via transfer of assets and
liabilities 0 1,500,000
Amortisation for the year -17,086,775 , -5,026,342
Closing accumulated amortisation -27,985,148 -26,308,342
Book value 71,722,884 71,713,758
Amortisation according to plan is estimated according to a useful lifetime of 9-10 years.
Note 8 Other intangible fixed assets
GROUP AND PARENT COMPANY
31 Dec 2006 31 Dec 2005
Opening acquisition cost 11,396,585 8,696,585
Purchases 0 2,700,000
Closing accumulated acquisition values 11,396,585 11,396,585
Opening amortisation -3,523,635 -1,739,317
Amortisation for the year -2 27.9,317 -1,784,318
Closing accumulated amortisation -5,802,952 -3,523,635
Book value 5,593,633 7 872,950
Amortisation according to plan is estimated according to a useful lifetime of 5 years.
Note 9 Land and buildings
GROUP
31 Dec 2006 31 Dec 2005
Opening acquisition cost 1,637,193 , 1,637,193
Closing accumulated acquisition cost 1,637,193 1,637,193
Opening depreciation -201,993 -147,426
Depreciation for the year -55,595 -54,567
Closing accumulated depreciation -257,588 -201,993
Book value 1,379,605 1,435,200
Book value, buildings 1,132,232 1,187,827
Book value, land 247,373 247,373
1,379,605 1 435,200

Depreciation according plan to is estimated according to a useful lifetime of 5 years.
Tax assessment value
31 Dec 2006
31 Dec 2005
Tax assessment value of the Group's properties:
31,702,000
31,702,000
attributable to buildings: 26,448,000 26,448,000
PARENT COMPANY
31 Dec 2006
31 Dec 2005
Opening acquisition cost 1,135,998 1,135,998
Closing accumulated acquisition cost 1,135,998 1,135,998
Opening depreciation
-181,952
-142,414
Depreciation for the year -39,539 -39,538
Closing accumulated depreciation -221,491 -181,952
Book value 914,507 954,046
Book value, buildings 766,958 806,497
Book value, land 147,549 147,549
914,507
954,046
Depreciation according to plan is estimated according to a useful lifetime of 25 years.
Tax assessment value
31 Dec 2006 31 Dec 2005
Tax assessment value of the Company's
properties:
15,023,000
15,023,000
attributable to buildings: 13,091,000 13,091,000
Note 10 Improvement costs for other parties’ property
GROUP
31 Dec 2006
31 Dec 2005
Opening acquisition cost 21,910,102 21,555,273
Purchases 489,686 354,829
Closing accumulated acquisition cost 22,399 788 21,910,102
Opening amortisation -17,584,841 -15,945,735
Amortisation for the year -1,668,003 -1,639,106
Closing accumulated amortisation -19,252,844 -17,584,841
Book value 3,146,944 4,325,261
PARENT COMPANY 31 Dec 2006 31 Dec 2005
Opening acquisition cost 9,081,963 21,555,273
Purchases 0 354,829

Acquisition value via transfer of assets and
liabilities
0 -12,828,139
Closing accumulated acquisition cost 9,081,963 9,081,963
Opening amortisation -8,711,119 -15,945,735
Accumulated amortisation via transfer of assets
and liabilities
0 7,269,008
Amortisation for the year -35,846 -34,392
Closing accumulated amortisation -8,746,965 -8,711,119
Book value 334,998 370,844
Amortisation according to plan is calculated for a useful lifetime of 8-10 years.
Note 11 Machinery and equipment
GROUP
31 Dec 2006 31 Dec 2005
Opening acquisition cost 206,061,807 176,310,257
Purchases 10,933,148 I7,068,959
Sales/disposals -2,812,155 -1,970,759
Reclassifications 2,403,136 14,653,350
Closing accumulated acquisition cost 216,585,936 206,061,807
Opening depreciation -140,750,199 -121,693,683
Sales/disposals 1,473,755 1,330,330
Depreciation for the year -20,386,346 -20,386,846
Closing accumulated depreciation -159,662,790 -140,750,199
Book value 56,923,146 65,311,608
Depreciation according plan to is estimated according to a useful lifetime of 3-8 years.
PARENT COMPANY
31 Dec 2006 31 Dec 2005
Opening acquisition cost 91,988,231 176,118,902
Purchases 3,893,708 9,302,407
Sales/disposals -1,324,407 -842,587
Acquisition value via transfer of assets and
liabilities
0 -92,590,491
Closing accumulated acquisition cost 94,557,532 91,988,231
Opening depreciation -82,681,958 -121,684,115
Accumulated depreciation via transfer of assets
and liabilities
0
43,026,217
Sales/disposals 751,848 701,629
Depreciation for the year -4,201,145 -4,725,689
Closing accumulated depreciation -86,131,255 -82,681,958
Book value 8,426,277 9,306,273
Depreciation according to plan is estimated according to a useful lifetime of 3-8 years.
Note 12 Constructions in progress and advance payments for tangible fixed assets

GROUP
31 Dec 2006 31 Dec 2005
Opening acquisition cost 2,403,136 16,848,698
Constructions in progress for the year 2,791,254 2,403,136
Reclassifications -2,403,136 16,848,698
-16,848,698
Closing accumulated acquisition cost 2,791,254
2,403,136
Note 13 Participations in Group
companies
PARENT COMPANY
Company, Corporate Identity
Number
Registered
offices
Number of
participations/
31 Dec 2006 31 Dec 2005
participation % Book value Book value
Recip ApS Köpenhamn 1,000 575,296,620 575,296,620
Corporate Identity Number
28305443
100%
Recip Stockholm AB Stockholm 1,000 100,000 100,000
Corporate Identity Number
556666-8249
100%
Recip Strängnäs AB Strängnäs 1,000 100,000 100,000
Corporate Identity Number
556666-8231
100%
Recip US Inc. Delaware 1,000 927,000 927,000
Corporate Identity Number
74-3061963
100%
Recip Holding AB Stockholm 100,000 9,000 9,000
Corporate Identity Number
556666-2697
9%
Recip Karlskoga AB Karlskoga 100,000 100,000 100,000
Corporate Identity Number
556662-4366
100%
Recip Karlskoga Fastigheter
AB Stockholm 100,000 100,000 100,000
Corporate Identity Number
556657-8315
100%
Recip AB Stockholm 100,000 100,000 0
Corporate Identity Number
556694-8849
100%
Recip Höganäs AB Höganäs 100,000 3,000,000 3,000,000
Corporate Identity Number
556666-2606
100%
Oy Aplifin Ab, name being
changed to Recip Finland Oy Helsingfors
Ab
1,000 22,925 0
Corporate Identity Number
2073382-6
100%
579,755,545 579,632,620
Opening acquisition cost 579,632,620 1,579,550
Purchase, new shares
122,925 575,344,070
Sales/disposals .
0 -191,000

Closing accumulated acquisition cost 579,755,545 576,732,620
Shareholders' contribution 38,000,000 2,900,000
Write-downs for the year -38,000,000 0
Closing accumulated revaluations, net 0 2,900,000
Book value 579,755,545 579,632,620
Note 14 Receivables from Group companies
PARENT COMPANY 31 Dec 2006 31 Dec 2005
Promissory note receivables to subsidiary 223,000,000 0
Book value 223,000,000 0
Note 15 Other long-term receivables
GROUP AND PARENT COMPANY
31 Dec
2006
31 Dec
2005
Endowment insurance 0 6,254,789
Deposits 0 66,326
Book value 0 6,321.115
Endowment insurance policies are classified as current receivables as per 31 December
2006, as these are estimated to be paid during 2007.
Note 16 Deferred tax assets
GROUP
31 Dec
2006
31 Dec
2005
Inter-company profit in inventory 344,510 1,627,103
Difference between permissible book and tax related
Value, machines and equipment 549,186 437,899 ,
Book value 893,696 2,065,002
All changes for the year of the above balance sheet items have been reported in the
income statement. The deferred income tax recoverable (temporary differences) are
attributable to the items mentioned above.
Note 17 Prepaid expenses and accrued income
GROUP 31 Dec
2006
31 Dec
2005
Prepaid rent 5,973,755 2,559,290
Prepaid leasing fees 536,356 631,821
Prepaid annual fees 3,915,403 1,309,975
Prepaid insurance premiums 1,543,945 2,018,412
Accrued interest income 0 352,613
Accrued income 2,838,350 1,707,853
Other items 1,404,218 4,728,558
16,212,027 13,308,522
PARENT COMPANY 31 Dec
2006
31 Dec
2005
Prepaid rent 570,897 16,274
Prepaid annual fees 2,165,060 613,230
Accrued interest income 0 352,613
Prepaid insurance premiums 1,095,315 1,529,832
Prepaid leasing fees 536,356 196,615
Other items 700,736 1,163,022

Note 18 Bank overdraft facility 31 Dec
2006
5,068,364 3,871,586
31 Dec
2005
The granted bank overdraft facility amounts to:
Group 75,000,000 75,000,000
Parent Company 75,000,000 75,000,000
Note 19 Equity
GROUP
Share capital Restricted
Non-restricted
reserves
equity
Amount at beginning of year 10,000,000 53,645,786 111,221,616
Translation difference 541,814
Adjustments between restricted and
non-restricted equity
26,257,286 -26,257,286
Group contribution paid -5,000,000
Tax effect of Group contribution 1,400,000
Dividends paid -16,000,000
Net profit/loss for the year 71,242,041
Amount at year-end 10,000,000 79,903,072 137,148,185
PARENT COMPANY
Share capital Restricted
Non-restricted
reserves
equity
Amount at beginning of year 10,000,000 2,000,000 678,415,986
Translation difference 952,730
Group contribution received/paid 106,950,000
Tax effect of Group contribution -29,946,000
Dividends paid -16,000,000
Net profit/loss for the year -118,029,797
Amount at year-end 10,000,000 2,000,000 622,342,919
Note 20 Untaxed reserves
PARENT COMPANY 31 Dec 2006 31 Dec 2005
Difference between recorded
depreciation and depreciation
according to plan
22,893,405 18,841,758
Tax allocation reserve, assessment
2001
0 2,804,299
Tax allocation reserve, assessment
2002
6,204,997 6,204,997
Tax allocation reserve ; assessment
2003
7,805,757 7,805,757
Tax allocation reserve, assessment
2004
7,937,464 7,937,464
Tax allocation reserve, assessment
2005
8,374,000 8,374,000
Tax allocation reserve, assessment
2006
7,900,000 7,900,000
61,115,623 59,868,275
Note 21 Long-term liabilities
GROUP 31 Dec 2006 31 Dec 2005
Repayments of borrowings within 1
year
Repayments of borrowings within 5
years
0 7,874,000
169,779,538 40,798,010

Repayments of borrowings within 5
years
0 23,052,452
169,779,538 71,724,462
PARENT COMPANY 31 Dec 2006 31 Dec 2005
Repayments of borrowings within 1
year
Repayments of borrowings within 5
years
Repayments of borrowings within 5
years
0 7,874,000
219,118,829 33,946,667
0 8,052,452
219,118,829 49,873,119
Note 22 Accrued expenses and deferred income
GROUP 31 Dec 2006 31 Dec 2005
Holiday pay liabilities and decreased working hours 17,180,276 18,177,220
Social security contributions 6,708,850 11,272,666
Accrued expense interests 0 431,849
Profit sharing and bonuses 7,811,966 4,594,766
Product rights 0 29,421,600
Other items 15,022,745 18,143,512
46,723,837
82,041,613
PARENT COMPANY 31 Dec 2006 31 Dec 2005
Holiday pay liabilities and decreased working hours 3,684,172 3,665,703
Social security contributions 2,258,264 2,947,574
Profit sharing and bonus 7,165,825 4,594,766
Product rights 0 29,421,600
Accrued expense interest 0 343,487
Other items 5,456,166 10,342,348
18,564,427
51,315,478
Note 23 Adjustments for non-cash items 31 Dec 2006 31 Dec 2005
GROUP
Depreciation/amortisation 44,909,787 30,391,178
Gains from disposal of tangible and
intangible fixed assets -2,036,062 -1,330,331
Unrealised exchange gains -2,671,387 0
Other items 9,867,351 0
50,069,689 29,060,847
PARENT COMPANY 31 Dec 2006 31 Dec 2005
Depreciation/amortisation 23,192,909 11,610,278
Write-down shares in subsidiaries
Gains from disposals of tangible and
38,000,000 -575,240,296
intangible fixed assets
-1,844,933
Other items -2,671,387 -4,222,568
56,676,589 -567,852,586

Note 24 Liabilities for which assets have been pledged
GROUP
31 Dec
2006
31 Dec
2005
Property mortgage, Strängnäs, Kemisten 3 19,400,000 19,400,000
Property mortgage, Karlskoga, Bofors 1:10 15,000,000 15,000,000
Floating charges 83,000,000 83,000,000
117,400,00
0
117,400,00
0
PARENT COMPANY 31 Dec
31 Dec
Property mortgage Strängnäs, Kemisten 3 19,400,000
2006
19,400,000
2005
Floating charges 83,000,000 83,000,000
Note 25 Promissory note receivables with Group companies
102,400,00
0
102,400,00
0
Some of the previous intra-group transactions reported last year as current receivables and liabilities have been
converted into long-term intra-group promissory note receivables. This also includes sales of product rights to
subsidiaries. This change has not resulted in any cash flows.

Stockholm, 22 March 2007
Anders G Carlberg
Chairman of the Board of Directors Lars-Göran Carlsson
Olle Christenson Thomas Eldered
Göran Pettersson Tony Sandell
Lars Backsell
Managing Director
My audit report was presented on 23 March 2007
Michael Forss
Authorised Public Accountant

Audit report
To the annual meeting of the shareholders of Recip Pharma AB
Corporate Identity Number 556498-8425
I have audited the annual accounts, the consolidated accounts, the accounting records and the
administration of the board of directors and the managing director of Recip Pharma AB for
the financial year 2006. The board of directors and managing director are responsible for
these accounts and the administration of the company, as well as for the application of the
Annual Accounts Act when preparing the annual accounts and consolidated accounts. My
responsibility is to express an opinion on the annual accounts, the consolidated accounts and
the administration based on my audit.
I conducted my audit in accordance with generally accepted auditing standards in Sweden.
Those standards require that I plan and perform the audit to obtain reasonable assurance that
the annual accounts and the consolidated accounts are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and disclosures in the
accounts. An audit also includes assessing the accounting principles used and their
application by the board of directors and managing director, as well as evaluating the overall
presentation of information in the annual accounts and the consolidated accounts. As a basis
for my opinion concerning discharge from liability, I examined significant decisions, actions
taken and circumstances of the company in order to be able to determine the liability, if any,
to the company of any board member or the managing director. I also examined whether any
board member or the managing director has, in any other way, acted in contravention of the
Companies Act, the Annual Accounts Act or the Articles of Association. I believe that my
audit provides a reasonable basis for my opinion set out below.
The annual report and consolidated accounts have been prepared in accordance with the
Swedish Annual Accounts Act and give a true and fair view of the company's and the group's
results of operations and financial position in accordance with generally accepted accounting
principles in Sweden. The statutory administration report is consistent with the Swedish
Annual Accounts Act and the other parts of the consolidated accounts.
I recommend to the annual meeting of shareholders that the income statements and the
balance sheets of the parent company and group be adopted, that the profit of the parent
company be dealt with in accordance with the proposal in the administration report and that
the members of the board of directors and the managing director be discharged from liability
for the financial year.
Stockholm, 23 March 2007
Michael Forss
Authorised Public Accountant