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Notes to the consolidated financial statements of the Galenica Group

1. Group organisation

1. Group organisation

General information

Galenica is a fully-integrated healthcare service provider in Switzerland. Galenica operates a network of pharmacies, develops and offers own brands and products, exclusive brands and products from business partners as well as a variety of on-site health services and tests for customers. Galenica is also a provider of pre-wholesale and wholesale distribution and database ­services in the Swiss healthcare market.

The parent company is Galenica Ltd., a Swiss public limited company with its headquarters in Bern. The registered office is at Untermattweg 8, 3027 Bern, Switzerland. Shares in Galenica Ltd. are traded on the SIX Swiss Exchange under ­securities no. 36067446 (ISIN CH0360674466).

The Board of Directors released the consolidated financial statements 2023 for publication on 7 March 2024. The 2023 consolidated financial statements will be submitted for approval to the Annual General Meeting on 10 April 2024.


2. Accounting principles

2. Accounting principles

Basis of preparation

The consolidated financial statements of Galenica have been prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standard Board (IASB), as well as the interpretations of the IFRS Interpretations Committee (IFRIC) and the provisions of Swiss law.

The consolidated financial statements are based on the financial statements of the individual companies of Galenica, ­prepared in accordance with uniform accounting principles. The reporting period comprises twelve months to 31 December.

Galenica's consolidated financial statements are prepared in Swiss francs (CHF) and, unless otherwise indicated, figures are rounded to the nearest CHF 1,000.

Due to rounding, numbers presented throughout this report may not add up precisely to the totals provided. Totals are calculated using the underlying amount rather than the presented rounded number.

Foreign currencies are not material for the consolidated financial statements.

Estimation uncertainty, assumptions and judgments

The preparation of the Group's consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, income and expense, and the disclosure of contingent liabilities as at the reporting date. Although these estimates and assumptions are made on the basis of all available information and with the greatest of care, the actual results may differ. This applies primarily to estimates and assumptions made with regard to the items set out below.

Leases (note 16)

IFRS 16 defines the lease term as the non-cancellable period of a lease together with the options to extend or terminate a lease, if the lessee is reasonably certain to exercise that option. Where a lease includes the option for the Group to extend the lease term, Galenica applies judgment in assessing whether it is reasonably certain that the option will be exercised. This will take into account the length of the time remaining before the option is exercisable, current trading, future trading forecasts as to the ongoing profitability of the point of sale and the level and type of planned future capital investment. A reassessment of the remaining life of the lease could result in a recalculation of the lease liability and a material adjustment to the associated balances.

Goodwill and intangible assets (note 17)

Goodwill and other intangible assets with an indefinite useful life are tested for impairment at least once a year. This involves estimating the value in use of the cash-generating unit (CGU) or group of CGUs to which the goodwill is allocated. It also requires a forecast of expected future cash flows as well as the application of an appropriate discount rate to calculate the present value of these cash flows.

Employee benefit plans and other non-current employee benefits (note 24)

The costs of the employee benefit plans and other long-term employee benefits are determined using actuarial valuations. These valuations involve making assumptions about the discount rate, future salary and pension developments, mortality and the employee turnover rate. Galenica considers the discount rate, the selection of mortality tables and the development of salaries to be key assumptions.

Fair value of contingent consideration liabilities from business combinations (note 26)

Contingent consideration, resulting from business combinations, is valued at fair value at the acquisition date as part of the business combination. When the contingent consideration meets the definition of a financial liability, it is subsequently remeasured to fair value at each reporting date. The determination of the fair value is based on discounted cash flows. The key assumptions take into consideration the probability of meeting each performance target and the discount rate.

Amendments to IFRS Accounting Standards

As at 1 January 2023 Galenica adopted the following amended IFRS Accounting Standards:

  • Amendments to IAS 1 and IFRS Practice Statement 2 - Disclosure of accounting policies
  • Amendments to IAS 8 - Definition of accounting estimates
  • Amendments to IAS 12 - Deferred tax related to assets and liabilities arising from a single transaction
  • Amendments to IAS 12 - International tax reform - Pillar Two rules

These changes have no or no material impact on the financial position, financial performance and cash flows of Galenica. The amendments to IAS 1 and IFRS Practice Statement 2 affected the disclosures of the accounting principles in these consolidated financial statements. Galenica has not early adopted any other standard or interpretation that has been issued but is not yet effective.

Future amendments to IFRS Accounting Standards

The IASB has issued various new and amended standards and interpretations with effective dates in the financial year 2024 or later. Galenica has not early adopted any of the following amendments to standards or interpretations that are potentially relevant for Galenica. Galenica intends to apply the new or amended standards for the first time in the financial year beginning on the date shown below:

  • Amendments to IAS 1 – Classification of liabilities as current or non-current (1 January 2024)
  • Amendments to IAS 7 and IFRS 7 - Supplier finance arrangements (1 January 2024)
  • Amendments to IFRS 16 - Lease liability in a sale and leaseback (1 January 2024)

Galenica is currently assessing the impact of these amendments. Based on a preliminary analysis, Galenica does not expect a material impact on the consolidated financial statements.


3. Operating segment information

3. Operating segment information

Galenica operates mainly in Switzerland within two operating segments Products & Care and Logistics & IT. The CEO of Galenica acting as chief operating decision maker (CODM) allocates resources and monitors performance of the Group's operating segments Products & Care and Logistics & IT on the basis of information prepared in accordance with IFRS Accounting Standards with exception of defined benefit plans and long-service awards, which are recognised at Group level.

In the operating segment Products & Care with its large network of pharmacies the accounting for leases is of particular importance. The Group continues to prepare information as if its leases were accounted for as operating leases (e.g. in line with Galenica's accounting policies prior to the adoption of IFRS 16). Those figures are relevant for management incentive and remuneration plans. However, Galenica has determined that the figures including the effects of IFRS 16 are used by the CODM for monitoring and resource allocation decisions and therefore presents its segment reporting as below.

The operating result (EBIT) comprises all operating income generated and expenses incurred in the corresponding segments. Financial income and expenses as well as income taxes are reported at Group level only and not allocated to the segments. The assets and liabilities include all items of the statement of financial position that can be directly or reasonably allocated to a segment.

With the creation of the strategic partnership with Redcare Pharmacy N.V., the business unit Mediservice Ltd. (including Curarex swiss AG) which was part of the Products & Care segment, is presented as discontinued operations. Operating segment information for the previous period has been restated to conform to the new presentation and is in line with the internal reporting. As a result, net sales to third parties has decreased by CHF 425.9 million and EBIT by CHF 10.3 million in 2022. Further information of the discontinued operation can be found in note 4, Discontinued operations.

Products & Care

The Products & Care segment comprises the «Retail» business area with offerings for patients and end customers (B2C) and the «Professionals» business area with offerings for business customers and partners in the healthcare sector (B2B).

The «Retail» business area comprises the two sectors «Local Pharmacies» (point-of-sale) and «Pharmacies at Home» (mail-order and home care). Retail operates at 538 locations Galenica's pharmacy network, the largest in Switzerland. With 369 pharmacies of its own and 169 partner pharmacies, Retail has outlets throughout the country. Galenica's own pharmacies comprise the Amavita brand with 188 branches and the Sun Store brand with 85 branches. Galenica also operates a chain of 89 pharmacies in partnership with Coop under the Coop Vitality brand. Galenica's pharmacy network also covers the speciality pharmacy Mediservice in partnership with Redcare Pharmacy N.V., which is focused on medication for treatment of patients at home, 6 majority interests in pharmacies and 169 Winconcept partner pharmacies.

The «Professionals» business area comprises the «Products & Brands» and «Services for Professionals» sectors. These activities focus on the development and marketing of healthcare services and products via the various sales channels: in-store at pharmacies (point-of-sale), shipments via mail-order pharmacies and e-shops or at home (home care), as well as business customers. Professionals launches and distributes a complete portfolio of consumer health products which is sold to Swiss pharmacies and drugstores. The companies of Professionals launches and distributes pharmaceutical and parapharmaceutical products and offer marketing and sales services to all partners in the healthcare market.

Logistics & IT

The Logistics & IT segment comprises the two sectors «Wholesale» and «Logistics & IT Services». These provide services for all those involved in the healthcare sector – pharmacies, drugstores, doctors, hospitals and care homes, partners and suppliers. Their activities focus on optimising and further developing the logistics services and service offering as well as providing innovative solutions that promote digitalisation in the healthcare market.

Wholesale plays an important role in the pharmaceutical supply chain. As a pharmaceutical wholesaler, Wholesale ensures on-schedule delivery within short deadlines to pharmacies, drugstores, doctors, hospitals and care homes throughout Switzerland.

Logistics & IT Services offers pharmaceutical and healthcare companies a broad range of specialised pre-wholesale services, from storage and distribution of products in Switzerland to debt collection. The companies of the Logistics & IT Services also offer solutions for the healthcare market. They operate comprehensive databases that provide additional knowledge for all service providers in the Swiss healthcare market and develop management solutions tailored specifically to the needs of the healthcare market. Logistics & IT Services is the leading provider of master data systems for Switzerland's entire healthcare market and publishes printed and electronic technical information on pharmaceutical products as well as complete management solutions for pharmacies. Furthermore, Logistics & IT Services provides Group internal IT services.

Group Services

The activities included within Group Services mainly comprise Galenica's central operations, which include Group Management and centralised Corporate functions such as Accounting, Controlling, Tax, Treasury, Corporate Finance, Investor Relations, Insurance, Indirect procurement, Human Resources, Legal & Board Services, Communications and Transformation.

Corporate charges management fees to the group companies for the organisational and financial management services that it provides.

Eliminations

Operating activities involve the sale of goods and services between the operating segments. 

Sale of goods and services between the operating segments and resulting unrealised gains are eliminated in the Eliminations column. In addition, Eliminations include adjustments recorded on Group level which mainly consist of costs for IAS 19 from defined benefit plans and long-service awards.

Segment assets and liabilities include loans and current accounts held with respect to other segments. These positions are eliminated in the Eliminations column.

Operating segment information 2023

Operating segment information 2023

in thousand CHF

Products & Care

Logistics & IT

Group Services

Eliminations

Galenica Group

Net sales

1,635,633

3,076,988

50,051

–1,016,661

3,746,011

Intersegmental net sales

–106,467

–863,775

–46,418

1,016,661

Net sales to third parties

1,529,166

2,213,213

3,633

3,746,011

Other income

7,869

7,896

3,736

–2,460

17,040

Share of profit from associates and joint ventures

6,554

17

268

6,838

Earnings before interest, taxes, depreciation and amortisation (EBITDA)

222,200

74,313

3,236

2,386 1)

302,135

Depreciation, amortisation and impairment

–68,429

–31,750

–3,058

237

–103,000

Earnings before interest and taxes (EBIT)

153,772

42,563

178

2,623 1)

199,135

Interest income

 

 

 

 

1,878

Interest expense

 

 

 

 

–9,466

Other net financial result

 

 

 

 

3,402

Earnings before taxes (EBT)

 

 

 

 

194,949

Income taxes

 

 

 

 

–29,245

Profit from continuing operations

 

 

 

 

165,704

 

 

 

 

 

 

Assets

1,832,129

1,029,042

600,327

-470,546 2)

2,990,952

Investments in associates and joint ventures

146,718

99

–2,832

143,985

Liabilities

591,285

630,139

747,648

-453,317 3)

1,515,755

 

 

 

 

 

 

Investments in property, plant and equipment

27,800

15,070

3,249

46,119 4)

Investments in intangible assets

1,483

31,337

–121

32,699 5)

 

 

 

 

 

 

Employees as at 31 December (FTE)

4,167

1,498

242

5,907

1) Including the effects of IAS 19 from defined benefit plans and long-service awards of CHF 5.8 million

2) Of which elimination of intercompany positions of CHF -472.3 million and other unallocated amounts of CHF 1.7 million

3) Of which elimination of intercompany positions of CHF -472.3 million and other unallocated amounts of CHF 19.0 million

4) Of which non-cash investments of CHF 2.5 million

5) Of which non-cash investments of CHF 2.6 million

Geographic information 2023

in thousand CHF

Switzerland

Other countries

Galenica Group

Net sales to third parties

3,705,756

40,255

3,746,011

Non-current assets 1)

1,711,285

488

1,711,773

1) Without employee benefit assets, financial assets and deferred tax assets

Operating segment information 2022

Operating segment information 2022 (restated)

in thousand CHF

Products & Care

Logistics & IT

Group Services

Eliminations

Galenica Group

Net sales

1,583,959

2,933,318

49,138

–977,960

3,588,456

Intersegmental net sales

–96,579

–834,935

–46,445

977,960

Net sales to third parties

1,487,380

2,098,383

2,693

3,588,456

Other income

7,112

6,265

3,123

–3,503

12,996

Share of profit from associates and joint ventures

4,255

17

–70

4,202

Earnings before interest, taxes, depreciation and amortisation (EBITDA)

212,141

80,518

1,759

-1,794 1)

292,624

Depreciation, amortisation and impairment

–66,114

–31,212

–2,541

294

–99,572

Earnings before interest and taxes (EBIT)

146,027

49,306

–782

-1,500 1)

193,052

Interest income

 

 

 

 

1,160

Interest expense

 

 

 

 

–5,239

Other net financial result

 

 

 

 

641

Earnings before taxes (EBT)

 

 

 

 

189,614

Income taxes

 

 

 

 

–32,267

Profit from continuing operations

 

 

 

 

157,347

 

 

 

 

 

 

Assets

1,784,254

921,458

320,811

-413,699 2)

2,612,825

Investments in associates and joint ventures

33,975

82

–1,375

32,682

Liabilities

604,571

524,903

619,655

-385,765 3)

1,363,364

 

 

 

 

 

 

Investments in property, plant and equipment

14,183

24,354

2,507

41,044 4)

Investments in intangible assets

1,276

28,469

–69

29,676 5)

 

 

 

 

 

 

Employees as at 31 December (FTE)

4,007

1,399

225

5,631

1) Including the effects of IAS 19 from defined benefit plans and long-service awards of CHF -0.7 million

2) Of which elimination of intercompany positions of CHF -395.6 million and other unallocated amounts of CHF -18.1 million

3) Of which elimination of intercompany positions of CHF -395.6 million and other unallocated amounts of CHF 9.8 million

4) Of which non-cash investments of CHF 0.9 million

5) Of which non-cash investments of CHF 1.7 million

Geographic information 2022 (restated)

in thousand CHF

Switzerland

Other countries

Galenica Group

Net sales to third parties

3,553,565

34,890

3,588,456

Non-current assets 1)

1,608,886

88

1,608,974

1) Without employee benefit assets, financial assets and deferred tax assets


4. Discontinued operations

4. Discontinued operations 

On 30 March 2023 Galenica announced the combination of the business activities of the specialty pharmacy Mediservice Ltd. (including Curarex swiss AG) and the online pharmacy shop-apotheke.ch in a strategic partnership with Redcare Pharmacy N.V. The closing of the transaction occurred on 16 May 2023.

Through the transaction, Galenica sold 51% of the shares of Mediservice Ltd. to Redcare Pharmacy N.V. The total purchase consideration amounted to CHF 215.5 million, consisting of a 6.1% investment in the listed company Redcare Pharmacy N.V., Netherlands with a fair value of CHF 109.5 million and the retained 49% participation in Mediservice Ltd. (including the online pharmacy shop-apotheke.ch) with a fair value of CHF 106.0 million. The remaining 49% participation in Mediservice Ltd. is accounted for as an investment in an associate.

At the date of disposal, the purchase consideration was reduced by an estimated amount of CHF 10.6 million which is contingent on net working capital developments as well as certain market developments and will become due between 2024 and 2026. At year end the remeasurement of the contingent consideration liability resulted in a change in fair value of CHF 7.7 million which was allocated to the net profit from discontinued operations. The transaction resulted in a gain on sale of CHF 119.4 million. As the purchase consideration received are non-cash items, the net cash flow from the disposal amounted to minus CHF 2.1 million which includes CHF 1.3 million cash disposed and CHF 0.8 million transaction costs and is shown as net cash flow from sale of subsidiaries in the consolidated statement of cash flows.

With the transaction Galenica lost control over Mediservice Ltd. (including Curarex swiss AG) and therefore derecognised the assets and liabilities of the business unit. The business of Mediservice Ltd. (including Curarex swiss AG) represented a separate major line of business for Galenica and was therefore classified as discontinued operations and the prior period was restated accordingly.

Gain on sale of discontinued operations

in thousand CHF

2023

Fair value of received equity instruments

109,456

Fair value of retained at equity investment in former subsidiary

106,011

Contingent considerations

–10,594

Total considerations received / interest retained

204,873

 

 

Carrying amount of net assets disposed

–86,776

Transaction costs

–813

Income taxes related to the sale of the discontinued operations

–5,515

 

 

Gain on sale of discontinued operations as per date of disposal

111,769

 

 

Net remeasurement of change in fair value of contingent consideration liabilities related to sale of discontinued operations

7,663

Gain on sale of discontinued operations

119,432

The table below shows the financial performance of the discontinued operations.

Statement of income of discontinued operations

in thousand CHF

1.1.– 16.5.2023

1.1.– 31.12.2022

Net sales

164,487

445,907

Other income

18

44

Expenses

–163,238

–435,939

Earnings before tax (EBT) from discontinued operations

1,266

10,012

 

 

 

Income taxes

–251

–1,500

 

 

 

Net profit from discontinued operations

1,015

8,512

The table below shows the financial position of the discontinued operations at the date of disposal.

Financial position of the discontinued operations at the time of disposal

in thousand CHF

16.5.2023

Cash and cash equivalents

1,330

Trade and other receivables

49,444

Inventories

18,168

Other current assets

2,583

Current Assets

71,525

 

 

Property, plant and equipment

681

Right-of-use assets

4,025

Intangible assets

67,517

Other non-current assets

93

Non-current assets

72,316

 

 

Total disposed assets

143,841

 

 

Financial liabilities

24,143

Lease liabilities

647

Trade and other payables

24,817

Other liabilities

1,999

Current liabilities

51,607

 

 

Lease liabilities

3,581

Deferred tax liabilities

1,637

Employee benefit liabilities

240

Non-current liabilities

5,458

 

 

Total disposed liabilities

57,065

 

 

Disposed net assets

86,776

Accounting principles discontinued operations

A disposal group is classified as a discontinued operation if it represents a separate major line of business or geographical business unit. Discontinued operations are not included in the result from continuing operations and are reported separately in the consolidated statement of income as profit from discontinued operations. The prior period amounts in the income statement and in the consolidated statement of cash flows are adjusted for comparison purposes. The elimination of intercompany transactions between continuing and discontinued operations is adjusted in order to reflect the impact of these transactions in continuing operations going forward. Therefore, intercompany transactions with the discontinued operations are treated as third parties transaction in the continuing operation.


5. Business combinations and disposals

5. Business combinations and disposals

Business combinations 2023

Acquisition of Padma AG. On 30 January 2023, Galenica acquired 100% of the shares in the Swiss company Padma AG. Padma AG is the parent company of the Padma Group with its two operating companies Padma Europe GmbH (Austria based) and Padma Deutschland GmbH (Germany based). Padma specialises in the manufacture and distribution of herbal formulations derived from Tibetan medicine.

The total purchase considerations amounted to CHF 23.3 million, of which CHF 20.9 million was settled in cash. A contingent consideration in the amount of CHF 2.4 million was recognised, which is due in 2026 if certain financial and operational targets are achieved. The fair value of the net identifiable asset amounted to CHF 14.2 million at the acquisition date. The goodwill of CHF 9.1 million was allocated to the operating segment Products & Care and corresponds to added value based on the acquirer-specific synergies expected to arise from the acquisition in expanding its complementary medicine portfolio and expanding its range of reimbursable medicines and the know-how of the employees gained. Transaction costs were not material.

Acquisition of pharmacies. Galenica acquired 100% of the interests in pharmacies in various locations in Switzerland. Upon acquisition, the pharmacies were merged with Galenicare Ltd.

The total purchase consideration amounted to CHF 11.4 million, of which CHF 11.3 million was settled in cash and CHF 0.1 million were recognised as deferred consideration. The fair value of the net identifiable assets amounts to CHF 0.8 million at the acquisition date. The goodwill of CHF 10.6 million was allocated to the operating segment Products & Care and corresponds to the added value of the pharmacies based on their locations and the know-how of the employees gained. Transaction costs were not material.

Business combinations

in thousand CHF

Padma

Pharmacies

2023 Total

2022 Total

Cash and cash equivalents

3,170

791

3,961

6,657

Trade receivables

1,156

251

1,407

4,857

Inventories

3,362

799

4,161

1,116

Property, plant and equipment

177

210

387

238

Right-of-use assets

3,815

1,942

5,756

4,002

Intangible assets

9,333

9,333

4,910

Other current and non-current assets

275

92

367

1,353

Trade payables

–418

–19

–437

–1,318

Lease liabilities

–3,815

–1,942

–5,756

–4,002

Net deferred tax liabilities

–1,871

12

–1,859

–1,043

Employee benefit liabilities

–378

–378

–396

Other current and non-current liabilities

–596

–1,318

–1,914

–2,218

Fair value of net assets

14,211

818

15,029

14,158

Goodwill

9,074

10,576

19,650

58,600

Non-controlling interests

–1,382

Purchase consideration

23,285

11,394

34,679

71,375

Cash acquired

–3,170

–791

–3,961

–6,657

Deferred consideration

–64

–64

Contingent consideration

–2,385

–2,385

–26,256

Net cash flow from current business combinations

17,730

10,538

28,268

38,462

Pro forma figures for acquisitions made in 2023 for the full 2023 financial year

Since their inclusion in Galenica's scope of consolidation, the businesses acquired contributed net sales of CHF 15.3 million and an operating result (EBIT) of CHF 1.4 million to the Group's results. If these acquisitions had occurred on 1 January 2023, they would have contributed additional net sales of CHF 4.1 million and increased EBIT by CHF 0.1 million.

Business combinations and disposals 2022

Acquisition of Medinform AG. On 5 July 2022, Galenica acquired 50% of the shares in the Swiss company Medinform AG and has a casting vote in the event of a disagreement, hence, Galenica has control over Medinform. Medinform is specialised in offering education and training programmes for pharmacies. The remaining 50% of the shares were retained by the previous owner. Non-controlling interests have been measured at the proportionate share of net identifiable assets. The remaining shareholders have a put option to sell their shares to Galenica which gave rise to a financial liability in the amount of CHF 3.9 million at acquisition date.

The purchase consideration amounted to CHF 4.4 million and was fully settled in cash. The fair value of the net identifiable assets amounted to CHF 2.8 million at the acquisition date of which CHF 1.4 million were recognised as non-controlling interests. The goodwill of CHF 3.0 million was allocated to the operating segment Products & Care and corresponds to the added value based on the synergies expected to arise from the acquisition due to offering various training and education programmes for employees internally in the future and the know-how of the employees gained. Transaction costs were not material.

Acquisition of Aquantic AG. On 11 July 2022, Galenica acquired 100% of the shares in the Swiss company Aquantic AG. The main activity of Aquantic is offering services for pharmaceutical companies and health insurance providers to simplify the reimbursement of the costs for specific medicines.

The total purchase consideration amounted to CHF 8.6 million, of which CHF 5.2 million was settled in cash. The contingent consideration in the amount of CHF 3.3 million was recognised which is due in 2027 if certain financial and operational targets are achieved. The fair value of the net identifiable assets amounted to CHF 1.0 million at the acquisition date. The goodwill of CHF 7.6 million was allocated to the operating segment Products & Care and corresponds to the added value based on the acquirer-specific synergies expected to arise from the acquisition in strengthening its position for business customers and the know-how of the employees gained. Transaction costs were not material.

Acquisition of Bahnhof Apotheke Langnau AG. On 15 November 2022, Galenica acquired 100% of the shares in the Swiss company Bahnhof Apotheke Langnau AG. Apart from operating a pharmacy located in Langnau the company is a leading provider of formulations for medicinal cannabis products.

The total purchase consideration amounted to CHF 48.0 million, of which CHF 25.1 million was settled in cash. The contingent consideration in the amount of CHF 22.9 million was recognised which is due in 2025 respectively in 2028 if certain financial and operational targets are achieved. The fair value of the net identifiable assets amounted to CHF 7.9 million at the acquisition date. The goodwill of CHF 40.1 million was allocated to the operating segment Products & Care and corresponds to the added value based on the acquirer-specific synergies expected to arise from the acquisition in strengthening its position as a leading fully integrated healthcare provider and the know-how of the employees gained. Transaction costs were not material.

Acquisition of pharmacies. Galenica acquired 100% of the interests in pharmacies in various locations in Switzerland. Upon acquisition, the pharmacies were merged with Galenicare Ltd.

The total purchase consideration amounted to CHF 10.4 million and was fully settled in cash. The fair value of the net identifiable assets amounts to CHF 2.5 million at the acquisition date. The goodwill of CHF 7.9 million was allocated to the operating segment Products & Care and corresponds to the added value of the pharmacies based on their locations. Transaction costs were not material.

Disposal of Careproduct AG. On 20 September 2022, Galenica disposed 100% of the shares in the Swiss company Careproduct AG to SAB Management Holding AG. The consideration amounted to CHF 2.2 million and was settled in cash. The carrying amount of the disposed net assets amounted to CHF 1.2 million including cash and cash equivalents of CHF 0.1 million. The net profit from this transaction of CHF 0.9 million has been recognised in other income including transaction costs of CHF 0.1 million.

Accounting principles business combinations

Subsidiaries, associates and joint ventures acquired during the reporting period are included in the financial statements as at the date when control, significant influence or joint control was obtained. Companies sold during the reporting period are included up to the date when control, significant influence or joint control was lost. The profit or loss on deconsolidation is recognised in operating income or other operating costs.

Contingent consideration is measured at fair value at the acquisition date and qualifies as a financial instrument. It is remeasured to fair value and any difference is recognised in other financial income or other financial expenses.

The difference arise from the acquisition of additional non-controlling interests in fully consolidated companies (purchase consideration less proportionate carrying amount of non-controlling interests) is considered to be an equity transaction and is thus taken directly to retained earnings in shareholders' equity.


6. Net sales

6. Net sales

Based on the classification of the business unit Mediservice Ltd. (including Curarex swiss AG) as discontinued operation, the disaggregation of net sales has been adjusted accordingly. Net sales information for the previous period has been restated to conform to the new presentation. Further information of the discontinued operation can be found in note 4, Discontinued operations.

Net sales 2023

Net sales 2023

in thousand CHF

Sale of goods

Sale of services

Total net sales

Intersegmental net sales

Total net sales to third parties

of which sale of goods to third parties

of which sale of services to third parties

Local Pharmacies

1,223,601

83,330

1,306,931

672

1,307,603

1,224,273

83,330

Pharmacies at Home

74,410

4,509

78,918

–283

78,635

74,126

4,509

Retail (B2C) 1)

1,297,725

87,838

1,385,564

674

1,386,237

1,298,399

87,838

Products & Brands

175,674

1,458

177,132

–87,205

89,927

88,522

1,405

Services for Professionals

63,116

15,819

78,934

–25,950

52,984

49,781

3,203

Professionals (B2B) 1)

238,815

17,248

256,064

–113,153

142,911

138,303

4,607

Products & Care 1)

1,534,129

101,504

1,635,633

–106,467

1,529,166

1,436,719

92,446

Wholesale

2,942,635

10,097

2,952,732

–812,965

2,139,767

2,132,506

7,260

Logistics & IT Services

390

143,575

143,965

–70,519

73,446

390

73,056

Logistics & IT 1)

2,943,019

133,968

3,076,988

–863,775

2,213,213

2,132,896

80,316

Group Services

50,051

50,051

–46,418

3,633

3,633

Eliminations 2)

–907,536

–109,124

–1,016,661

1,016,661

Galenica Group

3,569,612

176,399

3,746,011

3,746,011

3,569,612

176,399

1) Including eliminations of intercompany net sales

2) Eliminations of intersegmental net sales

Net sales 2022 (restated)

Net sales 2022 (restated)

in thousand CHF

Sale of goods

Sale of services

Total net sales

Intersegmental net sales

Total net sales to third parties

of which sale of goods to third parties

of which sale of services to third parties

Local Pharmacies

1,210,214

76,641

1,286,856

–9

1,286,846

1,210,208

76,638

Pharmacies at Home

69,471

4,562

74,032

–370

73,663

69,101

4,561

Retail (B2C) 1)

1,279,516

81,203

1,360,718

–209

1,360,509

1,279,309

81,200

Products & Brands

155,906

1,782

157,687

–80,460

77,227

75,446

1,781

Services for Professionals

55,857

15,236

71,093

–21,695

49,398

44,775

4,623

Professionals (B2B) 1)

211,802

16,979

228,780

–102,156

126,625

120,221

6,404

Products & Care 1)

1,488,181

95,778

1,583,959

–96,579

1,487,380

1,399,575

87,805

Wholesale

2,810,514

9,845

2,820,359

–791,079

2,029,280

2,022,691

6,588

Logistics & IT Services

359

130,353

130,712

–61,609

69,103

348

68,755

Logistics & IT 1)

2,810,862

122,457

2,933,318

–834,935

2,098,383

2,023,040

75,344

Group Services

49,138

49,138

–46,445

2,693

2,693

Eliminations 2)

–876,428

–101,531

–977,960

977,960

Galenica Group

3,422,614

165,841

3,588,456

3,588,456

3,422,614

165,841

1) Including eliminations of intercompany net sales

2) Eliminations of intersegmental net sales

Accounting principles net sales

Net sales represent revenue from contracts with customers from the sale of goods or services. Revenue is recognised in the amount that reflects the consideration to which Galenica expects to be entitled when the promised goods or services are transferred to customers.

Where invoices are issued, payment terms in Switzerland usually range between 10 and 30 days, for both goods and services.

Sale of goods

For retail pharmacy sales, revenue is recognised at the point in time when the customer takes possession of the products at the point-of-sale and for wholesale transactions upon shipment of the products to the customer.

Galenica has determined that its customer loyalty programs represent separate performance obligations to which revenue is allocated based on relative stand-alone selling prices, which considers historical redemption patterns. Revenue is deferred and recognised when the award credits are redeemed, which is typically 2 to 4 months after the sale of the initial products. At the end of each period, unredeemed credits are reflected as contract liabilities and included in trade and other payables in the consolidated statement of financial position.

Refund liabilities from contracts with customers are estimated based on actual sales volumes for the financial year and refund percentages as agreed with customers. These liabilities are usually settled in the subsequent financial year. ­Revenue from gift cards purchased by customers is deferred as contract liabilities until goods or services are transferred, which is typically within 12 months after the sale of the gift card. Any amounts not expected to be redeemed are recognised based on historical redemption patterns.

Customer returns are not material.

Sale of services

Revenue from services includes logistics services, healthcare and consultation services, the processing and sale of information and IT services as well as other contractually agreed services.

In the business area “Retail (B2C)“ sale of services mainly includes healthcare services and consultations sales. Most of sale of service in the business area “Professionals (B2B)” are in connection with marketing, purchase and other services for independent pharmacies or associates and joint ventures as well as providing education services for staff in pharmacies and drugstores. Depending on the service the performance obligations are either satisfied over time or at a point in time (i.e. when consultation took place).

In the business area “Logistics & IT Services” sale of services mainly includes pre-wholesale services and group external as well as group internal IT services and in the business area “Wholesale” sale of service mainly includes various logistic services. Depending on the service the performance obligations are either satisfied over time or at a point in time (i.e. when volumes are handled).


7. Other income

7. Other income

Other income

in thousand CHF

2023

2022 (Restated) 1)

Income from own work capitalised

10,011

6,757

Rental income from operating leases

1,690

1,762

Gain on disposal of property, plant and equipment

703

212

Gain on disposal of subsidiaries

853

Other operating income

4,636

3,413

Other income

17,040

12,996

1) Figures restated (refer to note 4, Discontinued operations)


8. Personnel costs

8. Personnel costs

Personnel costs

in thousand CHF

2023

2022 (Restated) 1)

Salaries and wages

449,756

425,305

Social security costs and pension expenses

60,040

61,495

Other personnel costs

41,188

38,882

Personnel costs

550,984

525,682

 

 

 

Average number of employees (FTE)

5,770

5,485

1) Figures restated (refer to note 4, Discontinued operations)

Social security costs and pension expenses contain expenses for defined benefit plans of CHF 26.6 million (previous year: expenses of CHF 32.0 million) (refer to note 24). Salaries and wages includes expenses for share-based payments of CHF 4.3 million (previous year: CHF 7.1 million) (refer to note 29).


9. Other operating costs

9. Other operating costs

Other operating costs

in thousand CHF

2023

2022 (Restated) 1)

Maintenance and repairs

29,380

23,315

Transport and shipping costs

42,158

40,846

Other operating and production costs

19,119

18,542

Rental and other lease expenses 2)

10,997

10,998

Administration costs

57,514

47,330

Marketing and sales costs

42,038

34,819

Non-income taxes

1,088

1,575

Loss on disposal of property, plant and equipment

34

6

Other operating costs

202,328

177,432

1) Figures restated (refer to note 4, Discontinued operations)

2) Of which other lease expenses (incidental expenses) of CHF 5.6 million (previous year: CHF 5.8 million)

Research and development

During the reporting period, expenses for research and development totalling CHF 12.7 million were recognised directly in other operating costs (previous year: CHF 13.5 million).


10. Financial result

10. Financial result

Financial result

in thousand CHF

2023

2022 (Restated) 1)

Interest income

1,749

940

Net interest income from employee benefit plans

129

220

Net remeasurement of change in fair value of contingent consideration liabilities

10,057

1,077

Other financial income

76

36

Financial income

12,012

2,274

 

 

 

Interest expense

6,515

2,839

Interest expense on lease liabilities

2,951

2,400

Other financial costs

6,343

235

Net loss on foreign exchange

388

237

Financial expenses

16,198

5,711

 

 

 

Net financial expenses

4,186

3,438

1) Figures restated (refer to note 4, Discontinued operations)


11. Earnings per share

11. Earnings per share

Number of outstanding shares

 

2023

2022

Total number of shares

50,000,000

50,000,000

Average number of treasury shares

–151,779

–265,164

Average number of outstanding shares

49,848,221

49,734,836

Effect from share-based payments

46,724

68,730

Theoretical average number of outstanding shares (diluted)

49,894,945

49,803,566

Earnings per share

 

2023

2022

Earnings per share

 

 

Net profit – attributable to shareholders of Galenica Ltd. (in thousand CHF)

285,367

165,132

Earnings per share (in CHF)

5.72

3.32

Diluted earnings per share (in CHF)

5.72

3.32

Earnings per share from continuing operations

 

 

Profit from continuing operations - attributable to shareholders of Galenica Ltd. (in thousand CHF)

164,919

156,620

Earnings per share from continuing operations (in CHF)

3.31

3.15

Diluted earnings per share from continuing operations (in CHF)

3.31

3.14

Earnings per share from discontinued operations

 

 

Profit from discontinued operations - attributable to shareholders of Galenica Ltd. (in thousand CHF)

120,448

8,512

Earnings per share from discontinued operations (in CHF)

2.42

0.17

Diluted earnings per share from discontinued operations (in CHF)

2.41

0.17


12. Income taxes

12. Income taxes

Income taxes

in thousand CHF

2023

2022 (Restated) 1)

Current income taxes

29,634

34,023

Income taxes of prior periods

114

–383

Deferred income taxes

–503

–1,373

Income taxes from continuing operations

29,245

32,267

Income taxes related to discontinued operations

5,766

1,500

Total income taxes

35,012

33,767

1) Figures restated (refer to note 4, Discontinued operations)

Tax reconciliation

in thousand CHF

2023

2022

Earnings before taxes from continuing operations

194,949

189,614

Earnings before taxes from discontinued operations

126,214

10,012

Earnings before income taxes

321,163

199,626

Weighted income tax rate in % of accounting profit

17.7%

18.3%

Expected income taxes

56,971

36,579

Effects due to the sale of participation of discontinued operations (not taxable)

–14,116

Effects of changes in tax rates

–290

–101

Effects of unrecognised losses in the current year

50

271

Realisation of unrecognised tax losses of prior periods

–668

–536

Recognition of tax losses of prior periods

–1,570

Remeasurement contingent consideration liabilities from business combinations (not taxable)

–2,112

–226

Other items and items from prior periods

–3,253

–2,220

Effective income taxes

35,012

33,767

Effective income tax rate in % of accounting profit

10.9%

16.9%

– of which income taxes attributable to continuing operations (reported in the statement of income)

29,245

32,267

– effective income tax rate attributable to continuing operations in % of EBT

15.0%

17.0%

– of which income taxes attributable to discontinued operations

5,766

1,500

Deferred taxes

 

 

 

2023

 

2022

in thousand CHF

Deferred tax assets

Deferred tax liabilities

Net carrying amount

Deferred tax assets

Deferred tax liabilities

Net carrying amount

Current assets

3,914

–27,000

–23,086

3,123

–24,716

–21,593

Property, plant and equipment

29

–2,518

–2,489

44

–2,944

–2,900

Right-of-use assets

–38,944

–38,944

–38,450

–38,450

Intangible assets

6,331

–24,917

–18,587

7,248

–22,223

–14,975

Investments

–685

–685

–4,823

–4,823

Financial assets

–20,211

–20,211

–4,020

–4,020

Lease liabilities

40,044

40,044

39,568

39,568

Provisions

–953

–953

46

–1,270

–1,224

Employee benefit plans

3,460

–3,677

–217

3,026

–33

2,993

Other temporary differences

295

–1,856

–1,561

110

–760

–650

Shareholders' equity

734

734

779

779

Deferred taxes due to temporary differences

54,806

–120,761

–65,956

53,944

–99,238

–45,294

Tax loss carryforwards

1,440

1,440

168

168

Gross deferred taxes

56,246

–120,761

–64,515

54,112

–99,238

–45,126

Netting of assets and liabilities

–51,300

51,300

 

–50,854

50,854

 

Net deferred taxes

4,946

–69,461

 

3,258

–48,384

 

Analysis of net deferred taxes

in thousand CHF

2023

2022 (Restated) 1)

1 January

–45,126

–55,324

Recognised as income taxes in profit or loss

 

 

– Change in temporary differences

–1,112

1,170

– Fiscal realisation of recognised tax loss carryforwards

–342

– Tax loss carryforwards taken into account for the first time

1,666

168

– Effects of changes in tax rates

290

36

Recognised in other comprehensive income

–13,940

10,025

Recognised in shareholders' equity (related to share-based payments)

146

146

Addition to scope of consolidation

–1,859

–1,043

Disposal from scope of consolidation

1,593

30

Discontinued operations

–5,766

–331

Translation differences

–66

–3

31 December

–64,515

–45,126

1) Figures restated (refer to note 4, Discontinued operations)

Temporary differences on which no deferred taxes have been recognised

in thousand CHF

2023

2022

Investments in subsidiaries

399,402

175,950

Tax loss carryforwards and tax credits

 

 

2023

 

2022

in thousand CHF

Tax loss carryforwards / tax credits

Tax effect

Tax loss carryforwards / tax credits

Tax effect

Tax loss carryforwards and tax credits

6,728

1,491

9,056

2,035

– of which capitalised as deferred tax assets

–6,336

–1,427

–844

–168

– of which netted with deferred tax liabilities

–95

–13

Unrecognised tax loss carryforwards and tax credits

297

51

8,212

1,868

Of which expire:

 

 

 

 

– within 1 year

– in 2 to 5 years

289

49

2,324

458

– in more than 5 years

9

1

5,888

1,410

OECD Pillar Two model rules

Galenica is within the scope of the OECD Pillar Two model rules. Since the Pillar Two model legislation has been enacted but was not into force in the financial year 2023 in the jurisdiction relevant to Galenica, Galenica has no related current tax exposure. Galenica applies the mandatory exception to recognising and disclosing information about deferred tax assets and liabilities related to Pillar Two income taxes, as provided in the amendments to IAS 12 issued in May 2023. Furthermore, Galenica has reviewed its corporate structure considering the introduction of Pillar Two Model Rules in various jurisdictions. Since the effective tax rate is above 15% in all jurisdictions in which Galenica operates, Galenica does not expect that the Group is subject to Pillar Two "top up" taxes. 


13. Trade and other receivables

13. Trade and other receivables

Trade and other receivables

in thousand CHF

2023

2022

Trade receivables

502,036

514,868

Bad debt allowances

–16,044

–9,752

Other receivables

32,301

24,364

Trade and other receivables

518,293

529,479

Change in bad debt allowances for trade receivables

in thousand CHF

2023

2022

1 January

–9,752

–8,609

Addition

–8,053

–2,147

Use

526

521

Reversal

775

450

Disposal from scope of consolidation

454

23

Translation differences

6

10

31 December

–16,044

–9,752

Maturity profile of trade receivables

 

 

 

2023

 

 

2022

in thousand CHF

Gross trade receivables

Bad debt allowances

Net trade receivables

Gross trade receivables

Bad debt allowances

Net trade receivables

Not past due

407,341

–4,752

402,589

440,662

–4,927

435,735

Past due:

 

 

 

 

 

 

– 1 to 30 days

69,219

–994

68,226

48,873

–735

48,138

– 31 to 60 days

7,920

–176

7,744

9,792

–493

9,299

– 61 to 90 days

1,936

–230

1,706

5,149

–462

4,687

– more than 90 days

15,620

–9,892

5,728

10,392

–3,135

7,256

Total

502,036

–16,044

485,992

514,868

–9,752

505,116

Accounting principles trade and other receivables

Trade receivables are initially measured at the transaction price determined in accordance with IFRS 15. Other receivables are carried at original invoice value. Allowances for uncollectable amounts are estimated based on expected credit losses, using life-time expected credit losses for trade receivables (simplified approach).

Any impairment losses are recognised in profit or loss in other operating costs.


14. Inventories

14. Inventories

Inventories

 

 

 

2023

 

 

2022

in thousand CHF

Raw material and merchandise 1)

Semi-finished and finished goods 2)

Total inventories

Raw material and merchandise 1)

Semi-finished and finished goods 2)

Total inventories

Gross carrying amount as at 1 January

331,281

4,162

335,443

313,957

4,358

318,315

Change in inventories

50,603

3,725

54,328

16,808

–196

16,611

Addition to scope of consolidation

2,431

1,730

4,161

1,116

1,116

Disposal from scope of consolidation

–18,174

–18,174

–549

–549

Translation differences

–77

–67

–145

–51

–51

Gross carrying amount as at 31 December

366,064

9,550

375,614

331,281

4,162

335,443

 

 

 

 

 

 

 

Allowance as at 1 January

–19,744

–540

–20,283

–22,745

–499

–23,245

Addition

–2,309

–1,085

–3,395

–527

–103

–630

Reversal / use

5,026

109

5,135

3,487

63

3,550

Disposal from scope of consolidation

6

6

30

30

Translation differences

15

4

19

12

12

Allowance as at 31 December

–17,006

–1,512

–18,518

–19,744

–540

–20,283

 

 

 

 

 

 

 

Net carrying amount as at 31 December

349,058

8,038

357,096

311,538

3,622

315,160

1) Including prepayments to suppliers

2) Including consumables / auxiliary material

Accounting principles inventories

The weighted average method is primarily used to determine cost for raw materials and merchandise. Semi-finished and finished goods are carried at the lower of cost of direct materials and labour and net realisable value. 

Inventory allowances are recognised on inventories for slow moving items and excess stock.

Cost of goods mainly include costs of goods and merchandise from the operating segments Products & Care and Logistics & IT. Price discounts, rebates or supplier discounts and other payments received from suppliers that are not payment for distinct goods or services provided by Galenica and thus on the purchase of goods are directly deducted from cost of goods.


15. Property, plant and equipment

15. Property, plant and equipment

Property, plant and equipment

in thousand CHF

Real estate

Assets under construction

Warehouse equipment

Furniture, fittings

Other property, plant and equipment

Total property, plant and equipment

Net carrying amount as at 31.12.2021

142,194

21,464

31,481

23,644

25,767

244,549

Addition

14,682

1,517

12,656

3,434

8,754

41,044

Disposal

–13

–99

–167

–280

Reclassification

16,681

–21,023

3,637

–30

736

Depreciation

–14,108

–6,241

–5,124

–10,509

–35,983

Addition to scope of consolidation

96

59

84

238

Disposal from scope of consolidation

–54

–6

–14

–74

Net carrying amount as at 31.12.2022

159,544

1,958

41,465

21,877

24,650

249,495

Addition

23,016

1,993

4,949

8,202

7,959

46,119

Disposal

–283

–112

–394

Reclassification

167

–822

206

73

376

Depreciation

–14,108

–6,354

–5,190

–9,572

–35,224

Addition to scope of consolidation

64

223

100

387

Disposal from scope of consolidation

–318

–333

–31

–681

Net carrying amount as at 31.12.2023

168,019

3,129

39,996

25,156

23,402

259,702

 

 

 

 

 

 

 

Overview as at 31.12.2022

 

 

 

 

 

 

Cost

327,442

1,958

115,959

113,542

67,192

626,094

Accumulated depreciation and impairment

–167,897

–74,495

–91,665

–42,542

–376,599

Net carrying amount as at 31.12.2022

159,544

1,958

41,465

21,877

24,650

249,495

 

 

 

 

 

 

 

Overview as at 31.12.2023

 

 

 

 

 

 

Cost

344,854

3,129

116,950

119,677

71,152

655,763

Accumulated depreciation and impairment

–176,835

–76,954

–94,522

–47,750

–396,060

Net carrying amount as at 31.12.2023

168,019

3,129

39,996

25,156

23,402

259,702

Accounting principles property, plant and equipment

Property, plant and equipment are measured at cost less accumulated depreciation and impairment. Depreciation is charged on a straight-line basis over the assets' useful lives as follows:

 

Years

Land

unlimited

Buildings

10 – 50

Warehouse equipment

5 – 15

Manufacturing equipment

5 – 15

Furniture, fittings

5 – 10

IT equipment

3 – 10

Vehicles

3 – 10

Other property, plant and equipment consists of manufacturing equipment, IT equipment and vehicles.

When items of property, plant and equipment are sold or derecognised, gains are recognised in other income and losses in other operating costs.


16. Leases

16. Leases

Right-of-use assets

in thousand CHF

Real estate

Other right of-use assets

Total right-of-use assets

Net carrying amount as at 31.12.2021

215,239

257

215,496

Addition

23,456

76

23,533

Reassessment of existing lease contracts

35,497

12

35,509

Depreciation

–51,059

–197

–51,255

Impairment

–1,644

–1,644

Reversal of impairment

1,492

1,492

Addition to scope of consolidation

3,951

52

4,002

Disposal from scope of consolidation

–444

–444

Translation differences

–4

–4

Net carrying amount as at 31.12.2022

226,489

196

226,685

Addition

22,104

139

22,243

Reassessment of existing lease contracts

31,297

5

31,302

Depreciation

–52,726

–118

–52,844

Impairment

–37

–37

Reversal of impairment

508

508

Addition to scope of consolidation

5,756

5,756

Disposal from scope of consolidation

–4,025

–4,025

Translation differences

–6

–6

Net carrying amount as at 31.12.2023

229,366

217

229,583

Lease liabilities

in thousand CHF

2023

2022

Net carrying amount as at 1 January

233,178

223,051

Addition

22,243

23,533

Reassessment of existing lease contracts

31,299

35,509

Interest expense on lease liabilities

2,972

2,455

Repayment of lease liabilities (including interest)

–55,173

–54,914

Addition to scope of consolidation

5,756

4,002

Disposal from scope of consolidation

–4,228

–455

Translation differences

–6

–4

Net carrying amount as at 31 December

236,041

233,178

– of which current lease liabilities

50,484

50,173

– of which non-current lease liabilities

185,557

183,005

Leases recognised in profit or loss (restated)

in thousand CHF

2023

2022 (Restated) 1)

Rental income from operating leases (included in other income)

1,690

1,762

Short-term lease expense (included in other operating costs)

–1,282

–1,154

Low-value lease expense (included in other operating costs)

–51

–17

Variable lease expense (included in other operating costs)

–4,045

–4,002

Depreciation of right-of-use assets

–52,580

–50,620

Impairment of right-of-use assets

–37

–1,644

Reversal of impairment of right-of-use assets

508

1,492

Interest expense on lease liabilities

–2,951

–2,400

1) Figures restated (refer to note 4, Discontinued operations)

The total cash outflow for leases including short-term leases, leases of low-value-assets and variable lease expenses was CHF 60.3 million (previous year: CHF 59.4 million).

Maturity profile of undiscounted lease liabilities

in thousand CHF

2023

2022

Up to 3 months

13,477

13,371

In 3 to 12 months

39,648

39,339

In 2 years

47,719

45,869

In 3 years

39,588

37,945

In 4 to 5 years

57,021

54,879

In 6 to 10 years

43,829

45,534

In more than 10 years

5,003

5,303

Total future cash flows from undiscounted lease liabilities

246,284

242,240

Possible future cash outflows related to extension options in an amount of CHF 192.6 million (previous year: CHF 183.1 million) are not included in lease liabilities because it is not reasonably certain that these options will be exercised.

The cash outflows for variable lease expenses in 2024 is expected to be similar to the amount recognised in 2023.

Galenica has entered into various lease contracts that have not yet commenced as at 31 December 2023. The future lease payments for these non-cancellable lease contracts amount to CHF 40.3 million (previous year: CHF 38.9 million). 

Accounting principles leases

Galenica has lease contracts for furniture, vehicles and a large number of contracts for real estate, mainly store locations, which include fixed rental payments and variable sales-based components. The significant majority of these lease contracts concerns locations of the pharmacies in the operating segment Products & Care.

Galenica determines the lease term as the non-cancellable term of the lease, together with any periods covered by an option to extend the lease if it is reasonably certain at inception of the contract to be exercised. Galenica has the option, under some of its leases, to lease the assets for additional terms of several (three, five or more) years. Galenica applies judgement in evaluating whether it is reasonably certain to exercise the option to renew. In doing so, Galenica considers all relevant factors including economic incentives. Galenica reassesses the lease term if there is a significant event or change in circumstances that is within its control and affects its ability to exercise, or not to exercise, the option to renew (e.g. a change in business strategy of the underlying asset).

Galenica uses the recognition exemptions for lease contracts that have a lease term of 12 months or less and do not contain a purchase option (short-term leases), and lease contracts for which the underlying asset is of low value (low-value assets).


17. Intangible assets

17. Intangible assets

Intangible assets

in thousand CHF

Intangible assets with finite useful lives 1)

Trademarks with indefinite useful lives

Software

Goodwill

Total intangible assets

Net carrying amount as at 31.12.2021

7,668

82,720

73,616

856,662

1,020,666

Addition

29,676

29,676

Disposal

–41

–41

Amortisation

–2,087

–10,997

–13,084

Addition to scope of consolidation

4,910

58,600

63,510

Disposal from scope of consolidation

–28

–28

–558

–614

Net carrying amount as at 31.12.2022

10,422

82,720

92,267

914,703

1,100,112

Addition

508

32,191

32,699

Amortisation

–2,974

–12,783

–15,757

Addition to scope of consolidation

392

8,940

19,650

28,983

Disposal from scope of consolidation

–4,471

–63,046

–67,517

Translation differences

–16

–1

–17

Net carrying amount as at 31.12.2023

8,332

91,660

107,204

871,307

1,078,503

 

 

 

 

 

 

Overview as at 31.12.2022

 

 

 

 

 

Cost

21,982

82,720

147,680

914,703

1,167,085

Accumulated amortisation and impairment

–11,561

–55,413

–66,973

Net carrying amount as at 31.12.2022

10,422

82,720

92,267

914,703

1,100,112

 

 

 

 

 

 

Overview as at 31.12.2023

 

 

 

 

 

Cost

22,863

91,660

168,294

871,307

1,154,124

Accumulated amortisation and impairment

–14,530

–61,090

–75,620

Net carrying amount as at 31.12.2023

8,332

91,660

107,204

871,307

1,078,503

1) Including trademarks, patents, licences and customer relationships

Trademarks with indefinite useful lives

This position includes trademarks that are well known nationally and internationally and actively advertised. These acquired trademarks are regarded as having indefinite useful lives for the following reasons: they were created many years ago, they do not expire, and the products sold under the trademarks have a history of strong revenue and cash flow performance. Galenica intends and has the ability to support the trademarks to maintain their values for the foreseeable future.

For impairment testing purposes the trademarks have been allocated to the cash-generating units Verfora, Padma and Spagyros in the operating segment Products & Care. The recoverable amount is determined on the basis of future discounted cash flows. Cash flows beyond the three-year planning period are based on the growth rates and discount rates before tax set out below, as approved in medium-term planning by management:

Trademarks with indefinite useful lives

in thousand CHF

2023

2022

Carrying amount

91,660

82,720

Growth rate

1.0%

1.0%

Pre-tax discount rate

7.0%

6.8%

According to the results of impairment testing for 2023 and 2022 using value in use calculations, no impairment was necessary. Galenica performed a sensitivity analysis taking into account reasonable changes in the assumptions used to calculate the discounted cash flows, such as higher discount rates, lower EBIT margins or lower perpetual growth rates. The sensitivity analysis for 2023 and 2022 did not reveal that a reasonable possible change in assumption would lead to an impairment.

Goodwill

Goodwill

 

 

2023

 

2022

in thousand CHF

Carrying amount

Growth rate

Pre-tax discount rate

Carrying amount

Growth rate

Pre-tax discount rate

Products & Care

785,760

1.0%

7.1%

829,156

1.0%

7.0%

Logistics & IT

85,547

1.0%

7.1%

85,547

1.0%

7.0%

Total

871,307

 

 

914,703

 

 

According to the results of impairment testing for 2023 and 2022 using value in use calculations, no impairment was necessary. Galenica performed a sensitivity analysis taking into account reasonable changes in the assumptions used to calculate the discounted cash flows, such as higher discount rates, lower EBIT margins or lower perpetual growth rates. The sensitivity analysis for 2023 and 2022 did not reveal that a reasonable possible change in assumption would lead to an impairment.

Accounting principles intangible assets

Intangible assets include acquired trademarks, patents, licences, customer relationships, purchased or internally developed software and other assets without physical substance. These items are measured at cost less accumulated amortisation and impairment.

Expenditure on internally developed software is capitalised when the capitalisation criteria are met and future economic benefits from use or sale of the software are expected. Software that is not yet available for use is tested for impairment annually or more frequently if there are indications of impairment.

Amortisation is charged on a straight-line basis over the estimated economic or legal useful life, whichever is shorter as follows:

 

Years

Trademarks, patents, licences, customer relationships

5 – 20

Software

2 – 15

The amortisation period and the amortisation method are reviewed at least at each financial year-end.

With the exception of trademarks in the business area Products & Brands, all intangible assets are assessed as having a finite useful life. Intangible assets with indefinite useful lives are not amortised but tested for impairment annually in the fourth quarter of the year, or more frequently if there are indications of impairment.

Goodwill is allocated to the cash-generating unit (CGU) or group of CGUs that are expected to benefit from a business combination. Management monitors goodwill at operating segment level.

Goodwill is tested for impairment annually in the fourth quarter of the year, or more frequently if there are indications of impairment. The impairment test is based on the discounted cash flow method. The WACC is used to determine the applicable pre-tax discount rate. The recoverable amount (higher of fair value less costs of disposal and value in use) of each CGU is determined on the basis of the medium-term plans for the next three years approved by management. Cash flows beyond the three-year planning period are extrapolated using a perpetual growth rate. If the recoverable amount is lower than the carrying amount, the carrying amount is reduced to the recoverable amount by recording an impairment charge.


18. Investments in associates and joint ventures

18. Investments in associates and joint ventures

Investments in associates

Investments in associates

in thousand CHF

2023

2022

Net carrying amount as at 1 January

3,108

Share of profit from associates

1,576

–358

Remeasurement of net defined benefit plans from associates

–1,226

Investments

109,511 1)

3,466 2)

Net carrying amount as at 31 December

112,969

3,108

1) Including contribution of fair value of retained at equity investment in former subsidiary of CHF 106.0 million (refer to note 4, Discontinued operations)

2) Including contribution of previously held securities with a fair value of CHF 1.7 million

Mediservice is the only significant associate of Galenica. Mediservice as specialty pharmacy offers a range of services for chronic and rare disease. Furthermore, Mediservice operates the pure online pharmacy Redcare-apotheke.ch and is registered in Zuchwil, Switzerland. Galenica owns 49% of the share capital and voting rights, Redcare Pharmacy N.V., Netherlands owns 51% of the share capital and voting rights.

Condensed financial information of Mediservice

in thousand CHF

2023

Current assets

91,182

Non-current assets

202,811

Current liabilities

66,702

Non-current liabilities

9,432

Equity before appropriation of earnings

217,859

Operating income 1)

295,665

EBIT 1)

4,526

Net profit 1)

4,011

Remeasurement of net defined benefit plans recognised in other comprehensive income 1)

–2,502

1) Figures as from 16 May to 31 December 2023

The net carrying amount of the investment in Mediservice is CHF 106.8 million as at 31 December 2023 (previous year: none). Unrealised profits on inventory are not considered in these amounts.

Investments in joint ventures

Investments in joint ventures

in thousand CHF

2023

2022

Net carrying amount as at 1 January

29,574

30,696

Share of profit from joint ventures

5,263

4,559

Remeasurement of net defined benefit plans from joint ventures

–403

–921

Investments

991

2,100

Dividends received

–4,410

–6,860

Net carrying amount as at 31 December

31,016

29,574

Coop Vitality is the only significant joint venture of Galenica. Coop Vitality is registered in Bern, Switzerland. Galenica owns 49% of the share capital and voting rights, Coop Cooperative owns 51% of the share capital and voting rights.

In case Coop Vitality was overindebted, Galenica has an unlimited obligation, in proportion to its equity interest, to ­restructure the company. At the reporting date, this joint venture is not overindebted.

Condensed financial information of Coop Vitality

in thousand CHF

2023

2022

Current assets

50,922

45,257

Non-current assets

101,604

112,697

– of which right-of-use assets

39,581

52,891

Current liabilities

53,720

49,313

– of which current lease liabilities

10,159

10,103

Non-current liabilities

37,128

50,328

– of which non-current lease liabilities

30,786

44,381

Equity before appropriation of earnings

61,678

58,312

Operating income

277,816

266,542

EBIT

14,625

13,058

Net profit

11,165

10,114

Remeasurement of net defined benefit plans recognised in other comprehensive income

–822

–1,879

The net carrying amount of the investment in Coop Vitality is CHF 30.2 million as at 31 December 2023 (previous year: CHF 28.6 million). Unrealised profits on inventory are not considered in these amounts.


19. Financial assets

19. Financial assets

Financial assets

in thousand CHF

2023

2022

Loans

11,767

9,120

Rental deposits

4,954

4,780

Other financial assets

926

732

Loans and other financial assets

17,647

14,632

Equity instruments at fair value through profit or loss

2,536

4,500

Equity instruments at fair value through other comprehensive income 1)

200,030

4,561

Financial assets

220,214

23,692

1) Including an investment in the listed company Redcare Pharmacy N.V., Netherlands, with a fair value of CHF 196.1 million (previous year: none)

Accounting principles financial assets

Non-current financial assets comprise loans, time deposits with a term to maturity of more than twelve months, rental deposits, equity instruments and derivative financial instruments with a positive fair value and a residual term to maturity of more than twelve months. Other than the derivatives measured at fair value through profit or loss, the financial assets are held to collect contractual cash flows comprising solely principal and interest payments and are therefore measured at amortised cost subsequent to initial recognition. Any credit losses on financial assets recognised represent 12 month expected losses and are estimated based on the credit risk of the counterparty. Any impairment is recognised in financial expenses.


20. Financial liabilities

20. Financial liabilities

Financial liabilities

in thousand CHF

2023

2022

Bank loans

30,000

Loans

28,053

6,320

Mortgages

1,229

1,241

Liabilities to pension funds

10,708

12,099

Bonds

419,871

380,194

Contingent consideration liabilities from business combinations

41,507

49,180

Other financial liabilities

7,431

4,279

Financial liabilities

538,799

453,312

– of which current financial liabilities

70,231

218,464

– of which non-current financial liabilities

468,569

234,848

Galenica issued two fixed-interest rate bonds for a nominal amount totalling CHF 420.0 million for the purpose of long-term financing. One bond of CHF 180.0 million was issued in 2017 with an annual coupon of 1.00% and a term of 9½ years, falling due on 15 December 2026 and the other bond of CHF 240.0 million was issued in 2023 with an annual coupon of 2.35 % and a term of 6½ years, falling due on 8 November 2029. The bonds are traded on the SIX Swiss Exchange under securities no. 36720670 (ISIN CH0367206700) and 125592445 (ISIN CH1255924453) respectively. The bonds closed at 98.65% (previous year: 95.55%) and 103.95% (issued in 2023 at 101.3%) respectively as at 31 December 2023. 

On 15 June 2023, Galenica redeemed a matured fixed-rate bond for a nominal amount of CHF 200.0 million with an annual coupon of 0.5%, initially issued in 2017. The bond was traded on the SIX Swiss Exchange under securities no. 36720669 (ISIN CH036706692).

Cash flow from financial liabilities and lease liabilities 2023

in thousand CHF

01.01.2023

Proceeds from financial liabilities

Repayment of financial liabilities

Addition to scope of consolidation

Disposal from scope of consolidation

Other changes

31.12.2023

Bank loans

60,000

–30,000

30,000

Loans

6,320

22,320

–653

66

28,053

Mortgages

1,241

–12

1,229

Liabilities to pension funds

12,099

5

–1,900

504

10,708

Private placement (notes)

55,000

–55,000

Bonds

380,194

239,726

–200,000

–48

419,871

Contingent consideration liabilities from business combinations

49,180

–7,672

41,507

Other financial liabilities

4,279

3,152

7,431

Financial liabilities

453,312

377,051

–287,565

–3,998

538,799

Lease liabilities

233,178

–52,201

5,756

–4,228

53,536

236,041

Financial liabilities and lease liabilities

686,490

377,051

–339,766

5,756

–4,228

49,538

774,841

Cash flow from financial liabilities and lease liabilities 2022

in thousand CHF

01.01.2022

Proceeds from financial liabilities

Repayment of financial liabilities

Addition to scope of consolidation

Disposal from scope of consolidation

Other changes

31.12.2022

Loans

5,654

1,607

–986

45

6,320

Mortgages

1,253

–12

1,241

Liabilities to pension funds

37,503

–24,895

–510

12,099

Bonds

380,306

–112

380,194

Contingent consideration liabilities from business combinations

24,000

25,180

49,180

Other financial liabilities

880

3,399

4,279

Financial liabilities

449,596

1,607

–25,893

28,002

453,312

Lease liabilities

223,051

–52,459

4,002

–455

59,038

233,178

Financial liabilities and lease liabilities

672,647

1,607

–78,351

4,002

–455

87,040

686,490


21. Trade and other payables

21. Trade and other payables 

Trade and other payables

in thousand CHF

2023

2022

Trade payables

384,774

323,345

Contract liabilities

9,500

9,137

Other payables

23,168

22,738

Trade and other payables

417,442

355,220

Contract liabilities are generally recognised in revenue within 12 months.


22. Provisions

22. Provisions

Provisions

in thousand CHF

2023

2022

1 January

4,684

3,808

Addition

4,136

3,479

Use

–2,304

–1,619

Reversal

–1,702

–984

Addition to scope of consolidation

745

31 December

5,558

4,684

– of which current provisions

4,880

4,487

– of which non-current provisions

678

197

Provisions are recognised for the estimated cost on damage, contractual liabilities, customer complaints, litigation risk and ongoing legal proceedings.


23. Contingent liabilities and commitments

23. Contingent liabilities and commitments

Galenica is subject to a variety of risks. These risks include, but are not limited to, risks regarding product liability, patent law, tax law, competition laws and anti-trust laws. A number of Group companies are currently involved in administrative proceedings, legal disputes and investigations relating to their business activities. The results of ongoing proceedings ­cannot be predicted with certainty. Management has established appropriate provisions for any expenses likely to be incurred. These projections, however, are also subject to uncertainty. Galenica does not expect the results of these proceedings to have a significant impact on the financial statements.

In March 2017, the Swiss Competition Commission (COMCO) issued a ruling, which imposed a fine of up to CHF 4.5 million on Galenica. The ruling relates to an investigation from 2012. Galenica regards the ruling issued by COMCO as incorrect in fact and in law. Galenica has taken the ruling to the Federal Administrative Court. With a decision delivered in February 2022, the Federal Administrative Court reduced the fine to around CHF 3.8 million. Galenica has taken this case to the Swiss Federal Supreme Court. Although the case is still pending before the Federal Supreme Court, COMCO obliged Galenica to pay the CHF 3.8 million penalty in June 2023 and therefore Galenica expensed the amount. Galenica remains confident of winning the case before the Federal Supreme Court.

In September 2020, the Swiss Competition Commission (COMCO) opened an investigation against Markant Handels- und Industriewaren-Vermittlungs AG and its customers, inter alia Galexis Ltd. The COMCO secretariat presented its preliminary findings at the end of June 2023. On this basis, Galenica estimates the amount of a possible sanction, including legal costs, to be around CHF 3.0 million and has recognised a provision.

Galenica entered into various obligations regarding the purchase of services, goods, and equipment as part of its ordinary business operations.

Galenica signed purchase agreements to acquire property, plant and equipment and intangible assets totalling CHF 17.3 million (previous year: CHF 15.9 million). The payments under these purchase commitments become due in 2024.

Furthermore, there are guarantees of CHF 6.8 million (previous year: CHF 8.6 million) and subordinated loans of CHF 0.9 million (previous year: CHF 1.4 million) to third parties.

There are no unusual pending transactions or risks to be disclosed.


24. Employee benefit plans

24. Employee benefit plans

The vast majority of the Galenica employees work in Switzerland and participate in the Galenica Pension Fund, which is financed by the employers and the employees. This plan is legally separate from Galenica and qualifies as a defined benefit plan. The pension plan covers the risks of the economic consequences of old age, disability and death in accordance with the Swiss Federal Occupational Retirement, Survivors and Disability Pension Plans Act (BVG/LPP). The pension plan is structured in the legal form of a foundation. All actuarial risks are borne by the foundation and regularly assessed by the Board of Trustees based on an annual actuarial appraisal prepared in accordance with BVG/LPP. The company's liabilities are limited to contributions that are based on a percentage of the insured salary under the Swiss law. Only in cases of a funded status that is significantly below a funded status of 100% as per the BVG/LPP law can Galenica be required to pay additional contri­butions. The calculations made in these appraisals do not apply the projected unit credit method required by IFRS Accounting Standards. If the calculations made in accordance with the provisions of BVG/LPP reveal a funded status of less than 100%, suitable restructuring measures need to be introduced. The Board of Trustees consists of employee and employer representatives.

The defined benefit plan is funded. Plan assets are managed separately from Galenica's assets by the independent pension fund.

The most recent actuarial valuation was prepared as at 31 December 2023. The pension fund assets are invested in accordance with local investment guidelines. Galenica pays its contributions to the pension fund in accordance with the regulations defined by the fund.

The final funded status pursuant to BVG/LPP is not available until the first quarter of the subsequent year. The projected funded status as at 31 December 2023 for Galenica Pension Fund is 110.8% (unaudited) and as at 31 December 2022 108.3% (final).

Defined benefit plans and long-service awards

 

 

 

2023

 

 

2022

in thousand CHF

Defined benefit plans

Long-service awards 1)

Total

Defined benefit plans

Long-service awards 1)

Total

Plan assets measured at fair value

1,101,802

1,101,802

1,044,124

1,044,124

Present value of defined benefit obligation

–1,079,958

–14,290

–1,094,248

–975,824

–14,988

–990,812

Surplus / (deficit)

21,844

–14,290

7,554

68,299

–14,988

53,311

Effect of asset ceiling

–6,346

–6,346

–69,941

–69,941

Net carrying amount recognised in employee benefit assets / liabilities

15,498

–14,290

1,208

–1,642

–14,988

–16,630

of which recognised in assets

20,429

20,429

183

183

of which recognised in liabilities

–4,931

–14,290

–19,221

–1,825

–14,988

–16,813

1) Long-service awards relate to provisions for jubilee payments

Change in present value of defined benefit obligation

 

 

 

2023

 

 

2022

in thousand CHF

Defined benefit plans

Long-service awards

Total

Defined benefit plans

Long-service awards

Total

1 January

–975,824

–14,988

–990,812

–1,085,962

–16,229

–1,102,191

Current service cost

–25,896

–1,633

–27,529

–31,804

–1,725

–33,529

Past service cost

–112

–112

–85

–85

Interest on defined benefit obligation

–19,768

–297

–20,066

–3,709

–59

–3,768

Actuarial gain/(loss)

–68,933

889

–68,044

169,856

1,512

171,368

Employee contributions

–20,962

–20,962

–19,662

–19,662

Benefits/awards paid

8,740

1,500

10,240

–310

1,587

1,277

Change in scope of consolidation

22,797

240

23,037

–4,148

–74

–4,222

31 December

–1,079,958

–14,290

–1,094,248

–975,824

–14,988

–990,812

Change in fair value of plan assets

in thousand CHF

2023

2022

1 January

1,044,124

1,143,224

Interest on plan assets

21,712

3,992

Remeasurement gain/(loss)

17,104

–155,683

Employee contributions

20,962

19,662

Employer contributions

31,634

29,791

Net benefits paid

–8,740

310

Administration cost

–1,051

–999

Change in scope of consolidation

–23,943

3,826

31 December

1,101,802

1,044,124

Net defined benefit cost

in thousand CHF

2023

2022

Current service cost

25,896

31,804

Past service cost

112

85

Net interest on net defined benefit liability

–430

–283

Administration cost

1,051

999

Net defined benefit cost 1)

26,628

32,605

1) Of which continuing operations of CHF 26.3 million (previous year: CHF 31.8 million)

Remeasurement of net defined benefit assets / liabilities

in thousand CHF

2023

2022

Actuarial gain/(loss) due to:

 

 

– Changes in financial assumptions

–91,366

190,663

– Experience adjustments

22,433

–20,807

Remeasurement of plan assets

17,104

–155,683

Effect in the change of asset ceiling

64,341

–69,941

Remeasurement of net defined benefit assets / liabilities recognised in other comprehensive income 1)

12,512

–55,768

1) Of which continuing operations of CHF 12.6 million (previous year: CHF -54.8 million)

Change in assumption and in estimate

The experience adjustments of CHF 22.4 million (previous year: CHF -20.8 million) were the result of various elements not expected in the prior year mainly the overall development of the population and other items as calculated by the external actuary.

The decrease of the discount rate from 2.10% to 1.40% (previous year: increase from 0.35% to 2.10%) resulted in a increase of the defined benefit obligation of CHF 91.4 million (previous year: decrease of CHF 190.7 million). 

Asset ceiling

in thousand CHF

2023

2022

1 January

–69,941

Interest income

–1,514

Change in the asset ceiling (recognised in other comprehensive income)

64,341

–69,941

Change in scope of consolidation

768

31 December

–6,346

–69,941

Investment structure of plan assets

in thousand CHF

 

2023

 

2022

Cash and cash equivalents

4,726

0.4%

5,312

0.5%

Debt instruments

246,256

22.4%

204,473

19.6%

Equity instruments

453,405

41.2%

424,749

40.7%

Real estate

258,636

23.5%

264,509

25.3%

Other investments

138,779

12.6%

145,081

13.9%

Fair value of plan assets

1,101,802

100.0%

1,044,124

100.0%

Current return on plan assets

 

3.8%

 

–13.2%

The Board of Trustees is responsible for investing the plan assets. It defines the investment strategy and determines the long-term target asset structure (investment policy), taking into account the legal requirements, objectives set, the benefit obligations and the foundations' risk capacity. The Board of Trustees delegates implementation of the investment policy in accordance with the investment strategy to an investment committee, which also comprises trustees from the Board of Trustees and a general manager. Plan assets are managed by external asset managers in line with the investment strategy.

Cash and cash equivalents are deposited with financial institutions with a credit rating of A or above.

Debt instruments (e.g. bonds) have a credit rating of at least BBB and quoted prices in active markets (level 1 of the fair value hierarchy). They can be investments in funds and direct investments.

Equity instruments are investments in equity funds. These generally have quoted prices in active markets (level 1 of the fair value hierarchy).

Real estate relates to both residential property and offices. These can be investments in quoted real estate funds (level 1 of the fair value hierarchy) or direct investments (level 3 of the fair value hierarchy). If real estate is held directly, it is valued by an independent expert.

Other investments consist of hedge funds, insurance linked securities (ILS), infrastructures, senior loans, private equity and receivables. There are receivables from Group companies amounted to CHF 9.7 million (previous year: CHF 11.2 million). Investments in hedge funds are classified as alternative investments. They are primarily used for risk management purposes. In most cases, quoted prices in an active market are not available for hedge funds investments (level 2 or level 3 of the fair value hierarchy).

The use of derivative financial instruments is only permitted if sufficient liquidity or underlying investments are available. Leverage and short selling are not permitted.

The pension funds manage the assets of 5,829 active members (previous year: 5,629) and 993 pensioners (previous year: 950).

Galenica does not use any pension fund assets.

Basis for measurement

 

2023

2022

Discount rate

1.40%

2.10%

Salary development

2.25%

2.25%

Pension development

0.00%

0.00%

Mortality (mortality tables)

BVG 2020 GT (CMI), 1.5%

BVG 2020 GT (CMI), 1.5%

Turnover

BVG 2020 (60% –100%)

BVG 2020 (60% –100%)

Sensitivity analysis

The discount rate, future salary development and mortality were identified as key actuarial assumptions. Changes in these assumptions would affect the defined benefit obligation (DBO) as follows:

Sensitivity analysis

 

 

2023

 

2022

in thousand CHF

Variations in assumptions

Impact on DBO

Variations in assumptions

Impact on DBO

Discount rate

+0.25%

–35,639

+0.25%

–28,301

 

-0.25%

37,808

-0.25%

30,258

Salary development

+0.25%

3,221

+0.25%

2,914

 

-0.25%

–3,221

-0.25%

–2,913

Mortality

+1 year

27,849

+1 year

21,281

 

-1 year

–27,868

-1 year

–21,921

The sensitivity analysis assumes potential changes in the above parameters as at year end. Every change in a key actuarial assumption is analysed separately. Interdependencies were not taken into account.

The pension obligations have an average duration of 15.7 years (previous year: 14.4 years).

Cash outflows for pension payments and other obligations can be budgeted reliably. The benefit plans collect regular contribution payments. Furthermore, the investment strategies safeguard liquidity at all times.

The employer contributions to the pension fund are estimated at CHF 32.3 million for 2024.


25. Shareholders' equity

25. Shareholders' equity

25.1 Share capital and number of shares

Galenica has fully paid-up share capital of CHF 5,000,000, divided into 50,000,000 publicly listed shares with a par value of CHF 0.10 each, as at the reporting date. All shares have the same capital rights with the exception of the treasury shares which do not generate any dividends. Voting rights and restrictions on voting rights are described in detail in Galenica's Annual report 2023 in the chapter Corporate Governance (unaudited).

Number of shares

 

Total shares Galenica Ltd.

Treasury shares

Outstanding shares

Balance as at 31.12.2021

50,000,000

–361,503

49,638,497

Transactions with treasury shares

177,763

177,763

Balance as at 31.12.2022

50,000,000

–183,740

49,816,260

Transactions with treasury shares

15,920

15,920

Balance as at 31.12.2023

50,000,000

–167,820

49,832,180

The treasury shares are reserved for share-based payments to employees.

25.2 Changes in consolidated shareholder's equity

On 3 May 2023, the Annual General Meeting approved a dividend payment of CHF 109.8 million for the financial year 2022 (previous year: CHF 104.4 million), corresponding to CHF 2.20 per registered share (previous year: CHF 2.10). For this ­purpose, CHF 1.10 was taken from the reserves from capital contributions (previous year: CHF 1.05) and CHF 1.10 from retained earnings (previous year: CHF 1.05) of Galenica Ltd. The dividend was paid out to the shareholders on 9 May 2023.

In the reporting period, 156,148 treasury shares (previous year: 7,704 treasury shares) were bought at an average price of CHF 70.51 (previous year: CHF 69.97) and 172,068 treasury shares (previous year: 185,467 treasury shares) were issued as share-based payments.

The expense for share-based payment transactions, allocated over the vesting period, has been recognised in personnel costs and accrued in consolidated shareholders' equity.

The acquisition of non-controlling interests reduced consolidated shareholders' equity by less than CHF 0.1 million (previous year: CHF 4.1 million). In 2022 as a result of business combinations CHF 1.4 million were recognised as non-controlling interests. Remaining Shareholders have a put option to sell their shares to Galenica which gives rise to a financial liability. The changes in the carrying amount of this financial liability reduced consolidated shareholder’s equity by CHF 0.3 million (previous year: CHF 3.9 million).

The Board of Directors will submit a proposal to the Annual General Meeting on 10 April 2024 to pay a dividend of CHF 2.20 per share entitled to receive dividend for the financial year 2023. For this purpose, CHF 1.10 is to be taken from the reserves from capital contributions and CHF 1.10 from the retained earnings. However, no dividend will be paid on treasury shares. Based on the number of treasury shares as at 31 December 2023, the total dividend would amount to CHF 109.2 million.


26. Financial instruments

26. Financial instruments

26.1 Categories of financial instruments

Carrying amounts of financial instruments 2023

in thousand CHF

Financial assets at amortised costs

Financial assets at fair value through OCI

Financial liabilities at fair value through profit or loss

Financial liabilities at amortised costs

Total

Cash and cash equivalents

116,159

116,159

Trade and other receivables

518,293

518,293

Financial assets

20,183 1)

200,030

220,214

Current financial liabilities

70,231

70,231

Current lease liabilities

50,484

50,484

Trade and other payables

407,943

407,943

Non-current financial liabilities

41,507

427,061 2)

468,569

Non-current lease liabilities

185,557

185,557

Total

654,635

200,030

41,507

1,141,276

 

1) Of which CHF 2.5 million are in connection to equity instruments which are designated as Financial asset at fair value through profit or loss

2) Of which CHF 4.3 million are in connection to put options for non-controlling interests. Changes in the liability amount are recognised in equity

Carrying amounts of financial instruments 2022

in thousand CHF

Financial assets at amortised costs

Financial assets at fair value through OCI

Financial liabilities at fair value through profit or loss

Financial liabilities at amortised costs

Total

Cash and cash equivalents

93,927

93,927

Trade and other receivables

529,479

529,479

Financial assets

19,132 1)

4,561

23,692

Current financial liabilities

218,464

218,464

Current lease liabilities

50,173

50,173

Trade and other payables

346,083

346,083

Non-current financial liabilities

49,180

185,668 2)

234,848

Non-current lease liabilities

183,005

183,005

Total

642,537

4,561

49,180

983,393

 

1) Of which CHF 4.5 million are in connection to equity instruments which are designated as Financial asset at fair value through profit or loss

2) Of which CHF 3.9 million are in connection to put options for non-controlling interests. Changes in the liability amount are recognised in equity

Net gain/(loss) on financial instruments 2023

in thousand CHF

Financial assets at amortised costs

Financial assets at fair value through OCI

Financial liabilities at fair value through profit or loss

Financial liabilities at amortised costs

Total

Change in fair value

-2,900 1)

10,057

7,157

Net gain/(loss) on foreign exchange

137

–526

–388

Other financial result

76

–94

–18

Interest income

1,418

1,418

Interest expense

–6,515

–6,515

Interest expense on lease liabilities

–2,951

–2,951

Interest income on impaired trade receivables

331

331

Expected credit losses

–7,124

–7,124

Impairment on financial assets

–3,349

–3,349

Net gain/(loss) recognised in profit or loss

–11,410

10,057

–10,086

–11,439

Net gain/(loss) recognised in other comprehensive income 2)

55,530

55,530

1) Related to equity instruments which are designated as Financial asset at fair value through profit or loss

2) Other comprehensive income includes changes in value of strategic investments (publicly and non-publicly traded equity instruments)

Net gain/(loss) on financial instruments 2022 (restated)1)

in thousand CHF

Financial assets at amortised costs

Financial liabilities at fair value through profit or loss

Financial liabilities at amortised costs

Total

Change in fair value

1,077

1,077

Net gain/(loss) on foreign exchange

–104

–133

–237

Other financial result

–144

–55

–198

Interest income

639

639

Interest expense

–2,839

–2,839

Interest expense on lease liabilities

–2,400

–2,400

Interest income on impaired trade receivables

301

301

Expected credit losses

–1,779

–1,779

Net gain/(loss) recognised in profit or loss

–1,086

1,077

–5,428

–5,437

1) Figures restated (refer to note 4, Discontinued operations)

Accounting principles financial instruments (measurement and categories)

Galenica distinguishes between the following types of financial assets and financial ­liabilities:

Financial assets at amortised cost

This category includes trade and other receivables as well as loans and other financial assets such as rental deposits. These financial assets are subsequently measured at amortised cost using the effective interest rate method less expected credit losses. Galenica uses the simplified approach to determine its bad debt allowances for trade receivables using lifetime expected credit losses. Expenses for expected credit losses comprise the change in bad debt allowance and receivables directly ­written off.

Uncollectible loans and receivables are only derecognised if a certificate of loss has been issued.

Financial assets at fair value through other comprehensive income

Financial assets measured at fair value through other comprehensive income includes equity instruments which were irrevocably classified to be strategic in nature.

Financial liabilities at fair value through profit or loss

Financial liabilities classified as at fair value through profit or loss correspond to contingent consideration liabilities from business combinations.

Financial liabilities at amortised costs

Financial liabilities mainly comprise trade and other payables as well as financial liabilities and bonds and are ­measured at amortised cost using the effective interest rate method.

Put options granted to non-controlling interests to sell their shares to Galenica as part of a business combination represent a contractual obligation to purchase non-controlling interests and give rise to a financial liability if the option does not provide Galenica with a present ownership interest in the shares concerned. This liability is measured at the redemption amount as if the put option had been exercised at the balance sheet date. Galenica accounts for changes in the carrying amount of this financial liability as an equity transaction.

26.2 Fair value measurement

Fair value

 

 

2023

 

2022

in thousand CHF

Carrying amount

Fair value

Carrying amount

Fair value

Bond (level 1 of the fair value hierarchy)

419,871

427,050

380,194

370,830

With the exception of the bond the carrying amounts of all financial instruments approximate to their fair value or fair value disclosure is not required (lease liabilities).

As at 31 December 2023 Galenica holds equity instruments designated at fair value through other comprehensive income including a 7.9% (previous year: none) investment in the listed (level 1 of the fair value hierarchy) company Redcare Pharmacy N.V., Netherlands, with a fair value of CHF 196.1 million (previous year: none) and other investment in non-listed (level 3 of the fair value hierarchy) companies with a fair value of CHF 3.9 million (previous Year: CHF 4.6 million). These investments were irrevocably designated at fair value through other comprehensive income as Galenica considers these investments to be strategic in nature. Galenica recognised in the consolidated statement of comprehensive income a remeasurement gain of CHF 55.5 million (previous year: none).

Fair value of financial instruments (level 3 of the fair value hierarchy)

Fair value of contingent consideration liabilities from business combinations (level 3 of the fair value hierarchy)

in thousand CHF

2023

2022

1 January

49,180

24,000

Arising from business combinations

2,385

26,256

Change in fair value (recognised in profit or loss)

–10,057

–1,077

31 December

41,507

49,180

Fair value changes of contingent consideration liabilities from business combinations are recognised in profit or loss (financial result) for the relevant reporting period.

Fair value of equity instruments designated at fair value through other comprehensive income (level 3 of the fair value hierarchy)

in thousand CHF

2023

2022

1 January

4,561

Addition

1,950

4,561

Change in fair value (recognised in other comprehensive income)

–2,583

31 December

3,928

4,561

Fair value and sensitivity analysis of contingent consideration liabilities from discontinued operations

Determining the contingent consideration liability in connection with the sale of Mediservice forecasted gross margin and further development of net working capital of the discontinued operation were identified as key assumptions. Galenica has recorded the amount of CHF 2.9 million as other liability based on the expected future gross margin for the years 2024-2026. The future cash outflows range between zero and CHF 3.1 million.

Furthermore, Galenica has not recorded any amount for a payment related to the further development of net working capital of the discontinued operation as per 31 December 2023 as the development of the net working capital was positive in the second half year of 2023. The relevant period under review was extended to the first half of 2024 and a possible but not expected cash out flow would be due in the second half year of 2024. The future cash outflows range between zero and CHF 2.3 million.

Further information of the discontinued operation can be found in note 4, Discontinued operations.

Sensitivity analysis of contingent consideration liabilities from business combinations (level 3 of the fair value hierarchy)

Sensitivity analysis of contingent consideration liabilities from business combinations (level 3 of the fair value hierarchy)

in thousand CHF

Lifestage Solutions

Bahnhof Apotheke Langnau

Aquantic

Padma

Fair value of contingent considerations as at 31.12.2023

17,287

18,408

3,395

2,418

Minimal payout

Maximal payout

24,000

29,000

5,450

4,000

Key assumption

forecasted net sales 1)

forecasted net sales 1)

forecasted EBITDA 1)

forecasted sell out prices 1)

Year of relevance

2024

2026+2027

2025+2026

2025

Sensitivity analysis

 

 

 

 

Impact on fair value by 5% increase of key assumption

1,864

1,663

388

967

Impact on fair value by 5% decrease of key assumption

–1,864

–1,663

–388

–967

1) of the acquired business


27. Financial risk management

27. Financial risk management

Galenica is exposed to various financial risks and liquidity requirements. Galenica's financing and financial risk management activities are centralised in Group Treasury, which manages financial exposures of Galenica on account of changes in interest rates, currency risks, credit risks and liquidity in a manner that is consistent with underlying business risks and in line with the treasury policy approved by the Board of Directors as well as internal guidelines on cash and liability management. In addition, capital management of Galenica is also mainly exercised and monitored at Group level.

It is Galenica's policy not to enter into any speculative financial arrangements and to ensure matching maturities. Together, the risk management and monitoring measures described below are designed to limit negative impact on the financial statements.

27.1 Liquidity risk

Liquidity risk management

The aim of liquidity risk management is to provide sufficient cash to meet Galenica's financial liabilities on time while maintaining the flexibility to take advantage of market opportunities and optimum investment conditions. Group Treasury is responsible for raising current and non-current loans as well as for decisions on investments. Apart from financing operations, Galenica's credit standing enables it to borrow funds at an advantageous rate. To ensure that Galenica can meet its payment obligations in good time, liquidity is monitored centrally. Group Treasury monitors the cash flows using rolling liquidity planning. This takes into account the maturities of the financial instruments as well as the cash flows from operating activities.

Maturity profile of financial liabilities 2023

in thousand CHF

Carrying amount

Total undiscounted cash flows

up to 3 months

3 to 12 months

1 to 5 years

Maturities more than 5 years

Trade and other payables

407,943

407,943

407,943

Current financial liabilities

70,231

70,231

68,090

2,141

Current lease liabilities

50,484

53,125

13,477

39,648

Non-current financial liabilities

48,697

50,336

50,336

Bonds

419,871

459,240

7,440

206,160

245,640

Non-current lease liabilities

185,557

193,159

144,328

48,831

Total

1,182,783

1,234,034

489,510

49,229

400,824

294,471

Maturity profile of financial liabilities 2022

in thousand CHF

Carrying amount

Total undiscounted cash flows

up to 3 months

3 to 12 months

1 to 5 years

Maturities more than 5 years

Trade and other payables

346,083

346,083

345,855

228

Current financial liabilities

18,431

18,431

18,422

9

Current lease liabilities

50,173

52,710

13,371

39,339

Non-current financial liabilities

54,688

57,366

57,366

Bonds

380,194

388,200

202,800

185,400

Non-current lease liabilities

183,005

189,530

138,693

50,837

Total

1,032,573

1,052,320

377,648

242,376

381,459

50,837

27.2 Credit risk

Credit risk management

Credit risk arise when a customer or a third party fails to meet its contractual obligations and causes Galenica a financial loss. Credit risk are minimised and monitored by restricting business relations to known, reliable partners.

Corporate policy ensures that credit checks are performed for customers who are supplied on credit. Trade receivables are subject to active risk management procedures. They are continually monitored and credit risk is reviewed in the process of reporting to management. Allowances for expected credit losses are made in accordance with uniform guidelines on the measurement of outstanding receivables.

In addition, credit risk arise in relation to financial assets, comprising cash and cash equivalents, securities and loans. The creditworthiness of the counterparties is regularly monitored and reported to management.

Financial assets subject to credit risk

in thousand CHF

2023

2022

Cash and cash equivalents (without cash on hand)

114,566

92,377

Trade and other receivables

518,293

529,479

Loans and other financial assets

17,647

14,632

Financial assets subject to credit risk

650,506

636,488

The financial assets subject to credit risk are primarily receivables.

Galenica applies internal risk management guidelines to identify concentrations of credit risk.

Galenica's financial assets are not exposed to a concentration of credit risk.

Trade receivables past due are analysed on an ongoing basis. These receivables are accounted for using individual bad debt allowances, adjusted for forward-looking factors specific to the debtors and the economic environment. Based on past experience, Galenica considers the creditworthiness of non-past due trade receivables to be good.


28. Capital management

28. Capital management

The capital of Galenica is managed and monitored at Group level. The objective of capital management at Galenica is to ensure the continuity of operations, increase enterprise value on a sustainable basis, provide an adequate return to investors, provide the financial resources to enable investments in areas that deliver future benefits for patients and customers and further returns to investors.

Galenica defines the capital that it manages as invested interest-bearing liabilities and equity. Galenica uses a system of financial control based on various key performance indicators. Capital is monitored based on the gearing, for example, which expresses net debt as a percentage of shareholders' equity including non-controlling interests and is communicated regularly to management as part of internal reporting.

Net debt, shareholders' equity and gearing are shown in the table below.

Net debt, shareholder's equity and gearing

in thousand CHF

2023

2022

Current financial liabilities 1)

69,990

218,464

Current lease liabilities

50,484

50,173

Non-current financial liabilities 1)

419,871

181,389

Non-current lease liabilities

185,557

183,005

Cash and cash equivalents

–116,159

–93,927

Interest-bearing receivables

–11,607

–11,347

Net debt

598,137

527,758

 

 

 

Equity attributable to shareholders of Galenica Ltd.

1,471,419

1,245,580

Non-controlling interests

3,777

3,881

Shareholders' equity

1,475,196

1,249,461

 

 

 

Gearing

40.5%

42.2%

1) Excluding non-interest-bearing financial liabilities

Galenica has no covenants requiring a minimum level of equity, nor is Galenica subject to any externally regulated capital requirements as seen in the financial services sector.


29. Share-based payments

29. Share-based payments

Remuneration for members of the Board of Directors

The members of the Board of Directors receive fixed annual remuneration and can choose whether to receive it in full or in part (50%) in shares of Galenica Ltd. The amount settled in shares is paid out with a discount of 25%. The shares may not be traded for the first five years.

The fair value of the shares granted is equivalent to the amount to be paid out in shares plus the discount of 25%.

Share plan for members of senior management

According to the participation plan, members of senior management receive their performance-related bonus partly in cash and partly in shares of Galenica Ltd. The proportion of cash to shares is set out in the regulations and is based on the salary grade of the recipient. In addition, all members of senior management are obliged to hold a number of shares of Galenica. The amount to be settled in shares is paid out in the form of shares of Galenica Ltd. with a discount of 25%. The shares may not be traded for the first five years.

The fair value of the shares granted is equivalent to the amount to be paid out in shares plus the discount of 25%.

Long-term incentive plan (LTI)

Members of the Corporate Executive Committee of Galenica and certain members of senior management participate in a LTI plan for the allocation of performance share units. The number of these performance share units is based on the extent to which defined long-term performance targets such as the Galenica Economic Profit and the relative total shareholders return (TSR) are attained. TSR is measured as a percentile ranking against a peer group of relevant companies. A LTI plan always runs for a vesting period of three years. At the beginning of each financial year a new LTI plan with a new vesting period of three years is issued. At the start of the vesting period a defined number of performance share units are individually allocated. The number of performance share units allocated is dependent on the defined percentage of the annual salary incorporated into the LTI plan as well as the effective share price at the time of the allocation. At the end of the vesting period performance share units are paid out to eligible beneficiaries in the form of shares of Galenica Ltd.

17,607 performance share units (previous year: 19,613 performance share units) were granted to beneficiaries at a fair value of CHF 65.95 (previous year: CHF 58.20) at the beginning of the reporting period for the 2023 LTI plan.

Employee share plan

Employees of Galenica are entitled to buy a fixed number of shares of Galenica Ltd. at a preferential price. All employees who, at the time of the purchase offer, are not under notice and have an employment contract of unlimited duration are entitled to acquire shares.

The purchase price for the shares is calculated at the time of the purchase offer based on the average price for the previous month less a 30% discount. The price discount is borne by the employer. The shares may not be traded for the first three years.

In the reporting period, employees purchased 80,252 shares of Galenica Ltd. (previous year: 75,607 shares) at a price of CHF 49.65 (previous year: CHF 53.50). This includes a discount of CHF 21.29 (previous year: CHF 22.90) per share.

Share-based payment expense

in thousand CHF

2023

2022

Remuneration for members of the Board of Directors

1,013

907

Share plan for members of senior management

904

3,087

Long-term incentive plan (LTI)

692

1,383

Employee share plan

1,709

1,731

Total

4,318

7,109


30. Related party transactions

30. Related party transactions

Related parties include all joint ventures, associates, pension funds, members of the Board of Directors and members of the Corporate Executive Committee.

Related party transactions

The transactions shown in the table below under joint ventures largely concern transactions with Coop Vitality and those under associates mainly concern transactions with Mediservice. In the previous year, the transactions with associates and joint ventures largely concerned transactions with Coop Vitality. All transactions are realised at market-based prices. The invoice payment for the sale of goods and services are due within 30 days and is payable in CHF.

Related party transactions

 

 

2023

2022

in thousand CHF

Joint ventures

Associates

Associates and joint ventures

Sale of goods

169,947

11,787

162,134

Income from services

8,087

1,712

7,900

Other income

17

17

Purchase of goods

216

13

346

Other operating costs

26

Financial income

247

34

106

Financial expenses

26

108

203

 

 

 

 

Receivables and loans

22,835

20,607

21,288

Trade payables and loans

7,320

21,280

5,633

The financial liabilities to pension funds amounted to CHF 10.7 million (previous year: CHF 12.1 million).

Remuneration of the Board of Directors and the Corporate Executive Committee

Remuneration of the Board of Directors and the Corporate Executive Committee

in thousand CHF

2023

2022

Remuneration

3,343

4,224

Social security costs and pension expenses

970

1,054

Share-based payments

1,686

2,537

Total

5,999

7,815


31. Subsequent events

31. Subsequent events

The following transactions occurred between 31 December 2023 and 7 March 2024, the date on which the consolidated financial statements 2023 were released for publication.

Acquisition of pharmacies. Galenica acquired 100 % of the interests in pharmacies at various locations in Switzerland. 

The purchase consideration was CHF 33.9 million, the fair value of the provisional net assets resulting from these additions was estimated at CHF 8.4 million at the acquisition date. Since the transactions were concluded shortly before the consolidated financial statements were issued, no further information was available to disclose the additional information required by IFRS Accounting Standards.

There were no further significant events after the reporting date.


32. Group companies

32. Group companies 

Group companies Products & Care

 

 

 

 

 

2023

2022

Group companies

Registered office

Method of consolidation

Currency

Share capital in thousand

Equity interest

Equity interest

Products & Care

 

 

 

 

 

 

Amavita Health Care Ltd.

CH-Niederbipp

full

CHF

100

100%

100%

Bahnhof Apotheke Langnau AG

CH-Langnau im Emmental

full

CHF

100

100%

100%

Bahnhof Apotheken Thun AG

CH-Thun

full

CHF

200

50%

50%

Bichsel AG

CH-Bern

full

CHF

1,000

100%

100%

Bichsel Interlaken Holding AG 1)

CH-Interlaken

full

CHF

100

100%

100%

Coop Vitality AG

CH-Bern

at equity

CHF

5,000

49%

49%

Coop Vitality Health Care GmbH 1)

CH-Niederbipp

at equity

CHF

20

49%

49%

Coop Vitality Management AG

CH-Bern

at equity

CHF

100

49%

49%

curarex swiss AG 1)2)

CH-Zuchwil

at equity

CHF

100

49%

100%

Dr. A.&L. Schmidgall GmbH & Co KG 1)

AT-Vienna

full

EUR

145

100%

100%

Emeda Ltd.

CH-Wangen-Brüttisellen

at equity

CHF

200

50%

50%

GaleniCare Ltd.

CH-Bern

full

CHF

700

100%

100%

GaleniCare Management Ltd.

CH-Bern

full

CHF

500

100%

100%

G-Pharma AG

CH-Niederbipp

full

CHF

100

100%

100%

Grosse Apotheke Dr. G. Bichsel AG 1)

CH-Interlaken

full

CHF

200

100%

100%

Hedoga AG

CH-Villars-sur-Glâne

full

CHF

100

100%

100%

Laboratorium Dr. G. Bichsel AG 1)

CH-Unterseen

full

CHF

200

100%

100%

Lifestage Solutions Ltd.

CH-Otelfingen

full

CHF

152

100%

100%

Medifilm Ltd. 1)

CH-Oensingen

full

CHF

1,300

100%

100%

medinform AG

CH-Zürich

full

CHF

100

50%

50%

MediService Ltd. 2)

CH-Zuchwil

at equity

CHF

363

49%

100%

PADMA Inc.

CH-Wetzikon

full

CHF

160

100%

-

Padma Aktiengesellschaft für tibetische Heilmittel 1)

CH-Freienbach

full

CHF

100

100%

-

PADMA EUROPE GmbH 1)

AT-Vienna

full

EUR

25

100%

-

PADMA Deutschland GmbH 1)

DE-Gräfelfing

full

EUR

35

100%

-

puravita AG

CH-Speicher

at equity

CHF

130

34.34%

23.08%

Schmidgall GmbH 1)

AT-Vienna

full

EUR

36

100%

100%

Spagyros Ltd.

CH-Worb

full

CHF

860

100%

100%

Sun Store Health Care Ltd.

CH-Niederbipp

full

CHF

100

100%

100%

SWISS PHARMA GmbH

DE-Rülzheim

full

EUR

51

100%

100%

Verfora Ltd.

CH-Villars-sur-Glâne

full

CHF

100

100%

100%

Winconcept Ltd.

CH-Bern

full

CHF

100

100%

100%

Zentral Apotheke Heerbrugg AG

CH-Au

full

CHF

100

100%

100%

1) Not directly held by Galenica Ltd.

2) Galenica sold 51% of the company shares as at 16 May 2023 (refer to note 4, Discontinued operations)

Group companies Logistics & IT and Group Services

 

 

 

 

 

2023

2022

Group companies

Registered office

Method of consolidation

Currency

Share capital in thousand

Equity interest

Equity interest

Logistics & IT

 

 

 

 

 

 

1L Logistics Ltd.

CH-Burgdorf

full

CHF

100

100%

100%

Alloga Ltd.

CH-Burgdorf

full

CHF

8,332

100%

100%

Aquantic AG

CH-Zeiningen

full

CHF

100

100%

100%

Dauf SA 1)

CH-Lugano

full

CHF

100

92.92%

92.88%

Galexis Ltd.

CH-Niederbipp

full

CHF

25,000

100%

100%

HCI Solutions Ltd.

CH-Bern

full

CHF

100

100%

100%

Pharma-Info AG 1)

CH-Biel

at equity

CHF

100

49%

49%

PharmaBlist Ltd. 1)

CH-Widnau

full

CHF

100

100%

100%

Pharmapool Ltd. 1)

CH-Widnau

full

CHF

962

100%

100%

Unione Farmaceutica Distribuzione SA

CH-Lugano

full

CHF

2,000

92.92%

92.88%

Group Services

 

 

 

 

 

 

Galenica Finanz Ltd.

CH-Bern

full

CHF

100

100%

100%

1) Not directly held by Galenica Ltd.


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