Pharmaceuticals Sector - Solvay

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52 Solvay Global Annual Report 2005 Management Report and Financial Statements Management Report page 53 Financial Statements page 57 - Consolidated income statement page 57 - Consolidated cash fl ow statement page 58 - Consolidated balance sheet page 59 - Statement of changes in equity page 60 - IFRS valuation rules page 61 - Notes to the fi nancial statements page 65 - Changes in the consolidation scope page 92 - List of companies included in the consolidation page 95 - Summary fi nancial statements of Solvay S.A. page 103 Auditor’s Report on the Consolidated Financial Statements page 105 Information for shareholders page 106
Management Report New records for SOLVAY in 2005, after excellent results in 2004 · Group net income up 51%, with cash fl ow of EUR 1.28 billion · Sales (+ 18%) and operating profi t (+ 23%) up strongly in all three Sectors · Proposed net dividend of EUR 2.00, up 5.3% Business progress Net sales reached EUR 8 562 million in 2005, up 18% compared to 2004 (+25% in the 4 th quarter). Sales increased in all three sectors: Pharmaceuticals +30%, Chemicals +14% and Plastics +13%. REBIT (EUR 912 million) increased 23% compared to 2004 (+20% in the 4 th quarter), giving an operating margin (REBIT on sales) of nearly 11%. Increases were recorded in all three Sectors: Pharmaceuticals +28%, Chemicals +58% and Plastics +4%. Group net income reached EUR 816 million in 2005, surpassing by 51% the 2004 result (EUR 541 million). Beyond the increase in operating profi t (REBIT +23% in 2005), Group net income included a net capital gain on the sale of interests in the polyethylene activities to BP (EUR 472 million) and a negative balance of nonrecurring items of EUR 357 million, consisting primarily of gains on the sales of buildings (EUR +135 million) and the recognition of provisions (EUR -432 million). Net income of the Group (EUR million) 1000 800 600 400 200 0 494 2002 430 2003 541 2004 816 2005 Progress by Sector 1. Net sales by Sector (EUR million) Total 2005 net sales = EUR 8 562 million 2004 2005 2005/2004 Pharmaceuticals 1 745 2 270 +30% Chemicals 2 433 2 785 +14% Plastics 3 093 3 507 +13% Total 7 271 8 562 +18% 2. REBIT by Sector (EUR million) Total 2005 REBIT = EUR 912 million 2004 2005 2005/2004 Pharmaceuticals 236 302 +28% Chemicals 180 285 +58% Plastics 374 389 +4% Total * 741 912 +23% * including non-allocated items: EUR -49 million in 2004 and EUR -64 million in 2005 Earnings in the Chemicals Sector (REBIT = EUR 285 million) were up 58% compared to 2004. Favorable markets throughout 2005 allowed the confi rmation of price increases. This, together with strict cost control and buoyant sales volumes, enabled the Sector to restore its operating margin to 10% for the whole of 2005. Plastics Sector earnings (REBIT = EUR 389 million) were up 4% compared to 2004, giving an operating margin of 11%. After declining gradually in the second quarter of 2005, vinyls margins improved from September onwards. Specialty Polymers, another major contributor to Group earnings, recorded 7% sales growth despite weak automotive and semiconductor markets. Start-up costs for new units and higher raw material prices prevented this increase in sales from translating into higher earnings. The earnings fi gures for the Pharmaceuticals Sector include since August 1, 2005 the results of Fournier Pharma, amounting for the 5 months to sales of EUR 265 million and an operating profi t (REBIT) of EUR 64 million. The performance of fenofi brate, Fournier Pharma’s “blockbuster”, was remarkable and more than met expectations. The Sector’s 2005 sales increased 30% from 2004. Sales were up in all therapeutic areas and developed well in North Solvay Global Annual Report 2005 53
Page 1 and 2:
Driven by the future Growth, Compet
Page 3 and 4:
Highlights January 2005 Solvay fi n
Page 5 and 6: Activities Group sales 2005 = EUR 8
Page 7 and 8: Our Vision - Independent industrial
Page 9 and 10: here to stay, in our view irreversi
Page 11 and 12: Board of Directors and Corporate Go
Page 13 and 14: 4 Executive Committee and General M
Page 15 and 16: Such a strategy is possible only wi
Page 17 and 18: Specialities Solvay Specialties fro
Page 19 and 20: Key fi gures [EUR million] Pharmace
Page 21 and 22: Cardiometabolic Cardiovascular dise
Page 23 and 24: Cardiometabolics Fenofi brate, TRIC
Page 25 and 26: “ DUODOPA® entered Solvay’s pr
Page 27 and 28: Pharmaceuticals Sector Therapeutic
Page 29 and 30: Key fi gures [EUR million] Chemical
Page 31 and 32: Growth To speed up its growth, the
Page 33 and 34: Initiatives have also been launched
Page 35 and 36: “ The ‘Soil Remediation Reagent
Page 37 and 38: Key fi gures [EUR million] Plastics
Page 39 and 40: Innovation “Twin-Sheet Blow Mould
Page 41 and 42: Plastics 37 Solvay Global Annual Re
Page 43 and 44: which it was able to take advantage
Page 45 and 46: New Business Development Priority t
Page 47 and 48: Meeting The Science Days organized
Page 49 and 50: Human Resources The Group’s fi ve
Page 51 and 52: “ At the end of this seminar, all
Page 53 and 54: Sustainable Development 2005 saw th
Page 55: Accident frequency rate Persons wor
Page 59 and 60: Expenditure on the future by Sector
Page 61 and 62: Financial Statements The following
Page 63 and 64: Consolidated balance sheet EUR mill
Page 65 and 66: IFRS valuation rules The main accou
Page 67 and 68: 9. Impairment Every year the Group
Page 69 and 70: Notes to the fi nancial statements
Page 71 and 72: (2) Financial data by region These
Page 73 and 74: and the estimated fi nancial conseq
Page 75 and 76: The deferred taxes recorded in the
Page 77 and 78: 2005 Millions EUR Acquisitions Disp
Page 79 and 80: Neopharma On January 19, 2005 the S
Page 81 and 82: (around 300 persons) with a view to
Page 83 and 84: In 2005 the impairment tests on goo
Page 85 and 86: Solvay Group purchased 100% of the
Page 87 and 88: Post-employment benefi t plans are
Page 89 and 90: Actuarial assumptions used in deter
Page 91 and 92: Analysis of total fi nancial debt b
Page 93 and 94: In this way, at the end of 2005, th
Page 95 and 96: The following amounts relating to J
Page 97 and 98: PORTUGAL Fournier Farmaceutica Port
Page 99 and 100: List of fully consolidated Group co
Page 101 and 102: Solvay Salz Holding GmbH, Hannover
Page 103 and 104: CANADA Fournier Pharma, Inc., Montr
Page 105 and 106: GREAT BRITAIN Inergy Automotive Sys
Page 107 and 108:
Summary fi nancial statements of So
Page 109 and 110:
Statutory auditor’s report to the
Page 111 and 112:
The Solvay share compared with the
Page 113 and 114:
Contacts: The Investor Relations Te
Page 115 and 116:
Shareholders’ Diary - May 9, 2006
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Pharmaceuticals Sector - Solvay

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