-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JoMijz6TO9SDMKpDbEPUZAObToB/eeJ3FRRvz0GhLNrUi7riD4fzdK7GjC8UpbXq iWRxJeoBae7fzBqAH2NeBA== 0001208646-07-000251.txt : 20070504 0001208646-07-000251.hdr.sgml : 20070504 20070504065133 ACCESSION NUMBER: 0001208646-07-000251 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20070504 FILED AS OF DATE: 20070504 DATE AS OF CHANGE: 20070504 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NOVO NORDISK A S CENTRAL INDEX KEY: 0000353278 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 000000000 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 333-82318 FILM NUMBER: 07817766 BUSINESS ADDRESS: STREET 1: NOVO ALLE DK 2880 CITY: BAGSVAERD DENMARK STATE: G7 ZIP: 00000 BUSINESS PHONE: 4544448888 MAIL ADDRESS: STREET 1: NOVO ALLE DK 2880 CITY: BAGSVAERD DENMARK STATE: G7 ZIP: 00000 FORMER COMPANY: FORMER CONFORMED NAME: NOVO NORDISK A/S DATE OF NAME CHANGE: 19900807 FORMER COMPANY: FORMER CONFORMED NAME: NOVO INDUSTRI A S /DENMARK/ DATE OF NAME CHANGE: 19890811 6-K 1 c96371_novo.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------ FORM 6-K ------------ REPORT OF FOREIGN ISSUER Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934 MAY 04 2007 ------------ NOVO NORDISK A/S (Exact name of Registrant as specified in its charter) NOVO ALLE DK-2880, BAGSVAERD DENMARK (Address of principal executive offices) ------------ Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F Form 20-F [X] Form 40-F [ ] Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes [ ] No [X] If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g-32(b):82-_____________________ 1ST QUARTER RESULTS FINANCIAL STATEMENT FOR THE PERIOD 1 JANUARY 2007 TO 31 MARCH 2007 NOVO NORDISK INCREASED FIRST QUARTER OPERATING PROFIT BY 24% DRIVEN BY DOUBLE-DIGIT SALES GROWTH AND GROSS MARGIN IMPROVEMENTS o Despite a significant negative currency development, Novo Nordisk reported 10% sales growth (16% in local currencies) o Sales of modern insulins increased by 32% (39% in local currencies). o Sales of NovoSeven(R) increased by 12%(18% in local currencies). o Sales of Norditropin(R) increased by 11% (16% in local currencies). o Sales in North America increased by 16% (27% in local currencies). o Operating profit increased by 24% to DKK 2,327 million. Adjusted for the impact from currencies underlying operating profit increased by more than 35%. o Net profit increased by 41% to DKK 1,709 million. Earnings per share (diluted) increased by 44% to DKK 5.35. o As a result of the significant depreciation of key invoicing currencies versus Danish kroner, reported operating profit is now expected to grow by 6-8%. Measured in local currencies the expectation for growth in operating profit is increased to more than 15%, reflecting a sustainable improvement in gross margin. o The Danish Government has recently proposed a change in the corporation tax regime. If adopted in its current form, Novo Nordisk's future income tax rate is expected, on a recurring basis, to be reduced by close to 2 percentage points. Lars Rebien Sorensen, president and CEO, said: "We are pleased with the solid sales growth that we have seen in the first quarter of 2007 despite the depreciation of key invoicing currencies. The US modern insulin market is a significant growth driver and we expect the US growth to continue supported by the expanded US sales force which will be in the field by the end of the second quarter." FINANCIAL STATEMENT FOR THE FIRST THREE MONTHS OF 2007 This interim report has been prepared in accordance with International Financial Reporting Standards (IFRS). The accounting policies used in the interim report are consistent with those used in the Annual Report 2006. The interim report has not been audited. Amounts in DKK million, except average number of shares outstanding, earnings per share and full-time employees.
Q1 Q1 % CHANGE Q1 2006 TO INCOME STATEMENT 2007 2006 Q1 2007 SALES 9,818 8,946 10% GROSS PROFIT 7,498 6,531 15% Gross margin 76.4% 73.0% Sales and distribution costs 3,048 2,728 12% Percent of sales 31.0% 30.5% Research and development costs 1,647 1,419 16% Percent of sales 16.8% 15.9% Administrative expenses 614 580 6% Percent of sales 6.3% 6.5% Licence fees and other operating income 138 76 82% OPERATING PROFIT 2,327 1,880 24% Operating margin 23.7% 21.0% Net financials 47 (151) - PROFIT BEFORE TAX 2,374 1,729 37% NET PROFIT 1,709 1,211 41% Net profit margin 17.4% 13.5% OTHER KEY NUMBERS Depreciation, amortisation and impairment 509 460 11% losses Capital expenditure 444 595 (25%) Cash flow from operating activities 2,551 2,091 22% Free cash flow 2,100 1,466 43% Total assets 44,742 41,299 8% Equity 29,676 27,042 10% Equity ratio 66.3% 65.5% Average number of shares outstanding (million) - diluted 319.7 325.2 (2%) DILUTED EARNINGS PER SHARE (IN DKK) 5.35 3.72 44% Full-time employees at the end of the period 24,045 22,556 7%
SALES DEVELOPMENT BY SEGMENTS Sales increased by 16% in local currencies and by 10% measured in Danish kroner. Growth was realised both within diabetes care and biopharmaceuticals - primarily driven by modern insulins (insulin analogues), NovoSeven(R) and Norditropin(R).
GROWTH GROWTH SHARE OF SALES 3M 2007 AS REPORTED IN LOCAL GROWTH DKK MILLION CURRENCIES IN LOCAL CURRENCIES THE DIABETES CARE SEGMENT Modern insulins 3,065 32% 39% 65% Human insulin and insulin-related sales 3,555 (4%) 1% 2% Oral antidiabetic products 523 10% 16% 5% DIABETES CARE - TOTAL 7,143 10% 16% 72% THE BIOPHARMACEUTICALS SEGMENT NovoSeven(R) 1,411 12% 18% 17% Growth hormone therapy 784 11% 16% 8% Other products 480 3% 10% 3% BIOPHARMACEUTICALS - TOTAL 2,675 10% 16% 28% TOTAL SALES 9,818 10% 16% 100%
SALES DEVELOPMENT BY REGIONS In the first quarter of 2007, sales growth measured in local currencies was realised in all regions. The main contributors to growth were North America and Europe providing 53% and 27%, respectively, of the total sales growth during the first quarter of 2007. International Operations contributed 16% and Japan & Oceania 4% of the sales growth in the first quarter of 2007. Sales in North America in the first quarter of 2007 were positively impacted by the implementation of the Medicare Part D scheme, a public scheme which offers improved medical treatment for elderly patients. As previously communicated, the greater part of the full-year 2006 positive impact was booked in the fourth quarter of 2006 as data became available, whereas in 2007 the positive benefit is expected to have a more even quarterly distribution. DIABETES CARE Sales of diabetes care products increased by 16% in local currencies and by 10% in Danish kroner to DKK 7,143 million compared to the first three months of 2006. MODERN INSULINS, HUMAN INSULIN AND INSULIN-RELATED PRODUCTS Sales of modern insulins, human insulin and insulin-related products increased by 16% measured in local currencies and by 10% to DKK 6,620 million in Danish kroner. All regions contributed to growth measured in local currencies, with North America and Europe having the highest growth rates. Novo Nordisk is the global leader within the insulin segment, with 52% of the total insulin market and 40% of the modern insulin market, both measured by volume. Sales of modern insulins increased by 39% in local currencies in the first three months of 2007 and by 32% in Danish kroner to DKK 3,065 million. All regions realised solid growth rates, with North America and Europe as the primary contributors to growth. Sales of modern insulins contributed 65% of the overall growth in local currencies and now constitute around 46% of Novo Nordisk's sales of insulin and insulin-related products. North America Sales in North America increased by 27% in local currencies in the first three months of 2007 and by 17% in Danish kroner, reflecting a solid penetration of the modern insulins NovoLog(R) and NovoLog(R) Mix 70/30 as well as the launch of Levemir(R) at the end of the first quarter of 2006. Novo Nordisk continues to consolidate its leadership position in the US insulin market with more than 41% of the total insulin market and 28% of the modern insulin market, both measured by volume. The expansion of the US sales force from 1,200 to 1,900 people is on track for completion by the end of June in order to further support the continued market penetration of Levemir(R). Furthermore, sales of human insulin products also increased as a consequence of increased volume as well as higher average selling prices. Europe Sales in Europe increased by 10% in local currencies and 10% measured in Danish kroner, reflecting continued progress for the portfolio of modern insulins. Novo Nordisk holds 57% of the total insulin market and 48% of the modern insulin market, both measured by volume. The solid growth in modern insulin sales in Europe will be further supported by the significantly improved label for Levemir(R) which was approved during the first quarter of 2007. International Operations Sales within International Operations increased by 17% in local currencies and by 8% in Danish kroner. The main growth driver in the first three months of 2007 was sales of modern insulins, primarily in Turkey, Russia and China. Furthermore, human insulin continues to add to overall growth in the region driven by China. Sales growth in the first quarter of 2007 was negatively impacted by the loss of a federal tender in Brazil. Japan & Oceania Sales in Japan & Oceania increased by 6% in local currencies and decreased by 4% measured in Danish kroner. The sales development reflects sales growth of modern insulins, NovoRapid(R) and NovoRapid(R) Mix 30, both of which are increasingly being sold in the leading prefilled delivery device, FlexPen(R). ORAL ANTIDIABETIC PRODUCTS (NOVONORM(R)/PRANDIN(R)) Sales of oral antidiabetic products increased by 16% in local currencies and by 10% in Danish kroner to DKK 523 million compared to the same period in 2006. This reflects increased sales in North America, Europe and International Operations compared to the same period last year, primarily related to a higher average sales price in the US market as well as an improved reimbursement situation in China. BIOPHARMACEUTICALS Sales of biopharmaceutical products increased by 16% in local currencies and by 10% measured in Danish kroner to DKK 2,675 million compared to the first three months of 2006. NOVOSEVEN(R) Sales of NovoSeven(R) increased by 18% in local currencies and by 12% in Danish kroner to DKK 1,411 million compared to the same period last year. Sales growth for NovoSeven(R) was primarily realised in North America and Europe. NovoSeven(R) sales in North America in the first three months of 2007 were robust, whereas the sales development in North America in the same period in 2006 was subdued. The sales growth of NovoSeven(R) during the first three months of 2007 reflected increased sales within the congenital and acquired haemophilia segments as well as a perceived higher level of investigational use. Treatment of spontaneous bleeds for congenital inhibitor patients remains the largest area of use. GROWTH HORMONE THERAPY (NORDITROPIN(R)) Sales of Norditropin(R) (ie growth hormone in a liquid, ready-to-use formulation) increased by 16% measured in local currencies and by 11% measured in Danish kroner to DKK 784 million. All regions contributed to growth measured in local currencies supported by the continued success of the prefilled delivery device NordiFlex(R). OTHER PRODUCTS Sales of other products within biopharmaceuticals, which predominantly consist of hormone replacement therapy (HRT) related products, increased by 10% in local currencies and by 3% in Danish kroner to DKK 480 million. This development primarily reflects continued sales progress in the US market for Vagifem(R), Novo Nordisk's topical oestrogen product. In April Novo Nordisk launched a low-dose version of Activella(R), a continuous-combined hormone therapy, in the US market. COSTS, LICENCE FEES AND OTHER OPERATING INCOME The cost of goods sold decreased by 4% to DKK 2,320 million, representing a gross margin of 76.4% compared to 73.0% in the first three months of 2006 when the gross margin was lower than the average for the full year of 2006. This improvement reflects improved production efficiency, an improved product mix and higher average prices in the US, but also a negative currency impact of around 0.4% primarily due to the lower value of US dollars versus Danish kroner compared to the same period last year. Total non-production-related costs increased by 12% to DKK 5,309 million. The increase reflects costs related to sales and distribution as well as research and development. Sales and distribution costs increased more than sales, primarily reflecting the increase in the US diabetes care sales force currently being implemented, expansions of sales forces in other markets such as Germany, France, the United Kingdom and China, as well as a provision relating to an antidumping court case in Brazil. Research and development costs also increased more than sales, reflecting the high number of late-stage clinical development projects currently being conducted. Licence fees and other operating income in the first three months of 2007 were DKK 138 million, positively impacted by a non-recurring income related to the out-licensing of an oral antidiabetic compound. NET FINANCIALS Net financials showed a net income of DKK 47 million in the first three months of 2007 compared to a net expense of DKK 151 million in the same period in 2006. Included in net financials is the result from associated companies with an expense of DKK 60 million, primarily related to Novo Nordisk's share of losses in ZymoGenetics Inc, compared to an expense of DKK 60 million in the same period in 2006. The foreign exchange result was an income of DKK 197 million compared to a loss of DKK 140 million in the same period last year. This development reflects gains on foreign exchange hedging activities due to the lower value of especially US dollars versus Danish kroner in the first three months of 2007 compared to the exchange rate level prevailing in 2006. OUTLOOK 2007 Novo Nordisk still expects more than 10% growth in SALES measured in local currencies for 2007. This is based on expectations of continued market penetration of Novo Nordisk's key strategic products within diabetes care and biopharmaceuticals, as well as expectations of increased competition in the diabetes care area during 2007 due to competitors' product launches. The growth in the US market is expected to show a more even quarterly distribution in 2007 compared to 2006 when the greater part of the positive impact from the implementation of the Medicare Part D scheme was booked in the fourth quarter. Given the current level of exchange rates versus Danish kroner, the reported sales growth rate for 2007 is expected to be negatively impacted by around 4 percentage points. As a consequence, reported sales growth is now expected to be less than 10%. For 2007, OPERATING PROFIT as reported is now expected to grow by 6-8%, due to the significant depreciation of key invoicing currencies versus Danish kroner compared to the exchange rate levels prevailing at the time of the full-year 2006 results released on 31 January 2007. Measured in local currencies the expectation for growth in operating profit is increased to more than 15%, reflecting a sustainable improvement in gross margin. The expectation for operating profit growth still includes an expected higher level of spending on the portfolio of research and development projects as well as a continued high level of spending on sales and marketing. For 2007, Novo Nordisk now expects a NET FINANCIAL INCOME of around DKK 1,800 million, including a positive impact from Novo Nordisk's divestment of the ownership of Dako's business activities, which was announced on 28 February 2007. The tax-exempt income of around DKK 1,500 million from the divestment is expected to be booked in the second half of 2007. The divestment is subject to a number of conditions including the approval of the transaction by applicable competition authorities, which is still pending, and the approval of the transaction at a shareholders' meeting of Dako A/S, which has been obtained. Given the prevailing Danish corporation tax regime, the effective tax rate for 2007 is now expected to be around 25% due to a positive non-recurring effect of around 3 percentage points from Novo Nordisk's divestment of the ownership of Dako's business activities. Furthermore, if the proposed change in the Danish corporation tax regime is adopted in its current wording, a positive recurring effect of close to 2 percentage points and a positive non-recurring effect from the re-evaluation of the company's deferred tax liabilities of around 1 percentage point are expected. CAPITAL EXPENDITURE is still expected to be around DKK 3 billion in 2007. Expectations for DEPRECIATIONS, AMORTISATION AND IMPAIRMENT LOSSES are still around DKK 2.3 billion, and FREE CASH FLOW is now expected to be close to DKK 7 billion, reflecting a positive impact from the divestment of the ownership of Dako's business activities. All of the above expectations are provided that currency exchange rates, especially the US dollar and related currencies, remain at the current level versus the Danish krone for the rest of 2007. Novo Nordisk has hedged expected net cash flows in relation to US dollars, Japanese yen and British pounds for 17, 14 and 11 months, respectively. The financial impact from foreign exchange hedging is included in 'Net financials'. RESEARCH AND DEVELOPMENT UPDATE DIABETES CARE Novo Nordisk has received marketing authorisation from the European Commission for the use of Levemir(R) once daily in combination treatment with oral antidiabetics (OADs) for people with type 2 diabetes. The updated label contains weight comparison data with relevant competitors to Levemir(R) emphasising the superior weight profile of Levemir(R). In addition, and as previously communicated, Novo Nordisk has published results from the observational PREDICTIVE(TM) study in the International Journal of Clinical Practice confirming that Levemir(R) for the majority of people effectively controls blood glucose levels and also limits weight gain compared to other basal insulins. In Japan, Novo Nordisk has completed recruitment in two phase 3 studies for the use of liraglutide, the once-daily human GLP-1 analogue, in type 2 diabetes. The two studies include in total around 600 patients with type 2 diabetes and results are expected to be available during the first half of 2008. Recruitment in the 20-week phase 2 dose-ranging study on the potential use of liraglutide as an antiobesity agent for treatment of obese, non-diabetic people has been finalised. The results are still expected to be available during the first half of 2008. BIOPHARMACEUTICALS As communicated on 26 February 2007, Novo Nordisk has decided not to pursue regulatory approval for the use of NovoSeven(R) in ICH. The global phase 3 trial showed that treatment with NovoSeven(R) significantly reduced intracerebral bleeding compared to placebo treatment. Even though improvement in clinical outcomes in terms of functional independence and neurological impairment was observed on day 15 after the bleeding, mortality and severe disability was not improved at the end of the study period at day 90. As mortality and severe disability at day 90 was the primary endpoint of the study, Novo Nordisk has decided not to seek regulatory approval for NovoSeven(R) in ICH. With regard to safety, study results were in line with the established safety profile of NovoSeven(R). In Europe, Novo Nordisk has received marketing authorisation from the European Commission for the use of NovoSeven(R) as a single high dose of 270 mcg per kg bodyweight in the treatment of mild and moderate bleeding events in inhibitor patients. The single dose will help the patients avoid the disruption that multiple intravenous infusions cause to their lives. It is also beneficial in terms of protecting the patient from the effects of repeated venous puncture. The phase 2 study for the use of NovoSeven(R) in cardiac surgery is now expected to be finalised during the first quarter of 2008. As previously communicated, an increase in the number of trial sites has been warranted to reach an acceptable recruitment rate; however, the opening of these additional sites has been more time-consuming than anticipated. Finally, as part of the IL-21 programme within oncology, Novo Nordisk has initiated a phase 1 dose-escalation study with IL-21 in combination with cetuximab for the treatment of colorectal cancer. In addition, Novo Nordisk is in the process of initiating a phase 1/2 study with IL-21 in combination with sunitinib for the use in renal cell carcinoma with up to 80 patients. EQUITY Total equity was DKK 29,676 million at the end of the first three months of 2007, equal to 66.3% of total assets, compared to 67.4% at the end of 2006. Please refer to appendix 5 for further elaboration of changes in equity during 2007. REDUCTION OF SHARE CAPITAL The Annual General Meeting, which was held on 7 March, approved a 4% reduction in the total share capital by cancellation of nominally DKK 26.96 million (13,480,000 shares of DKK 2) of the current treasury B shares. TREASURY SHARES AND SHARE REPURCHASE PROGRAMME As per 1 May 2007, Novo Nordisk A/S and its wholly-owned affiliates owned 19,163,309 of its own B shares, corresponding to 5.69% of the total share capital. During the period from 1 February to 1 May 2007, Novo Nordisk did not repurchase any shares. In 2006, Novo Nordisk repurchased shares equal to a cash value of DKK 3 billion out of the total DKK 10 billion share repurchase programme for 2006-2008. In 2007, Novo Nordisk now expects to repurchase B shares equal to a cash value of DKK 5 billion following the divestment of the ownership of Dako's business activities. SUSTAINABILITY ISSUES UPDATE NOVO NORDISK HOSTS GLOBAL CHANGING DIABETES LEADERSHIP FORUM With the aim of changing diabetes Novo Nordisk hosted a Global Changing Diabetes Leadership Forum on 12-14 March 2007 in New York. The Forum was supported by the International Diabetes Federation (IDF) and is the most recent initiative taken by Novo Nordisk to call for a worldwide change in diabetes care. Former US President Bill Clinton was the keynote speaker. The Forum included dialogues on how to redefine healthcare and focus on the needs of people with diabetes, and involved 185 leaders in diabetes, healthcare, politics and media from more than 20 countries. NOVO NORDISK ENTERS INTO PARTNERSHIP ON GREENER ENERGY SUPPLIES IN DENMARK On 1 May Novo Nordisk signed an agreement with DONG Energy to enter into a partnership on 'Less Energy and Greener Energy'. This agreement will be a significant contribution to the company's target to reduce CO2 emissions by 2014. Under the partnership, Novo Nordisk commits to converting all future energy savings in Denmark towards purchasing of green electricity for Danish production sites from DONG Energy, to be supplied from wind turbines. In return, DONG Energy will help identify energy savings options at Novo Nordisk's Danish production sites, which represent 90% of the company's total CO2 emissions. With the agreement, the aim is for all of the company's Danish production sites to operate on renewable energy by 2014. The partnership is expected to serve as an engine for a higher degree of conversion to renewable energy supplies among Danish industries. LEGAL ISSUES UPDATE US HORMONE THERAPY LITIGATION As of 1 May 2007, Novo Nordisk Inc., as well as the majority of hormone therapy product manufacturers in the US, is a defendant in product liability lawsuits related to hormone therapy products. These lawsuits currently involve a total of 44 individuals who allege use of a Novo Nordisk hormone therapy product. These products (Activella(R) and Vagifem(R)) have been sold and marketed in the US since 2000. Until July 2003, the products were sold and marketed exclusively in the US by Pharmacia & Upjohn Company (now Pfizer Inc.). Further, an additional 27 individuals currently allege, in relation to similar lawsuits against Pfizer Inc., that they also have used a Novo Nordisk hormone therapy product. Novo Nordisk does not have any court trials scheduled for 2007 and does not presently expect to have a trial scheduled before 2008. Novo Nordisk does not expect the pending claims to impact Novo Nordisk's financial outlook. ANTIDUMPING CASE IN BRAZIL In March 2007, Novo Nordisk was informed that the Superior Court in Brazil reversed a decision from a lower court in an antidumping case against Novo Nordisk initiated by the Brazilian authorities. According to the decision Novo Nordisk will have to pay antidumping duties and interest related to the period 2001-2005. Novo Nordisk disputes the antidumping claim and expects to appeal the decision to the Supreme Court in Brazil. A provision for the antidumping duties and related interest has been included in the financial result for the first quarter of 2007. CONFERENCE CALL DETAILS At 13.00 CET today, corresponding to 7.00 am New York time, a conference call will be held. Investors will be able to listen in via a link on novonordisk.com, which can be found under 'Investors - Download centre'. Presentation material for the conference call will be made available approximately one hour before on the same page. FORWARD-LOOKING STATEMENT The above contains forward-looking statements as the term is defined in the US Private Securities Litigation Reform Act of 1995. This in particular relates to information included under the headings 'Outlook 2007', 'Research and development update' and 'Legal issues update' with reference to plans, forecasts, expectations, strategies, projections and assessment of risks. Words such as 'believe', 'expect', 'may', 'will', 'plan', 'strategy', 'prospect', 'foresee', 'estimate', 'project', 'anticipate', 'can', 'intend' and similar words identify forward-looking statements. Examples of such forward-looking statements include, but are not limited to: (i) statements of plans, objectives or goals for future operations including those related to Novo Nordisk's products, product research, product introductions and product approvals as well as co-operations in relation thereto, (ii) statements containing projections of revenues, income (or loss), earnings per share, capital expenditures, dividends, capital structure or other net financials, (iii) statements of future economic performance and (iv) statements of the assumptions underlying or relating to such statements. These statements are based on current plans, estimates and projections, and therefore undue reliance should not be placed on them. Moreover, such statements are not guarantees of future results. By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that the predictions, forecasts, projections and other forward-looking statements will not be achieved. Novo Nordisk cautions that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements. Factors that may affect future results include, but are not limited to, interest rate and currency exchange rate fluctuations, delay or failure of development projects, interruptions of supplies and production, product recall, pressure on insulin prices, unexpected contract breaches or terminations, government-mandated or market-driven price decreases for Novo Nordisk's products, introduction of competing products, Novo Nordisk's ability to successfully market current and new products, exposure to product liability and other legal proceedings and investigations, changes in reimbursement rules and governmental laws and related interpretation thereof, perceived or actual failure to adhere to ethical marketing practices, developments in international activities, which also involve certain political risks, investments in and divestitures of domestic and foreign companies and unexpected growth in costs and expenses. Risks and uncertainties are further described in reports filed by Novo Nordisk with the US Securities and Exchange Commission (SEC), including the company's Form 20-F for 2006 filed with the US SEC in February 2007, and to the section 'Risk management' of the Annual Report 2006 available on our website (novonordisk.com). Forward-looking statements speak only as of the date they were made, and unless required by law Novo Nordisk is under no duty and undertakes no obligation to update or revise any of them, after the distribution of this Stock Exchange Announcement, whether as a result of new information, future events or otherwise. MANAGEMENT STATEMENT Today, the Board of Directors and Executive Management reviewed and approved the interim report and accounts of Novo Nordisk A/S for the first three months of 2007. The interim report and accounts have been prepared in accordance with International Financial Reporting Standards and the additional Danish disclosure requirements applying to listed companies' interim reports and accounts. In our opinion the accounting policies used are appropriate and the overall presentation of the interim report and accounts is adequate. Furthermore, in our opinion the interim report and accounts give a true and fair view of the Group's assets, liabilities, financial position and of the results of the operations and consolidated cash flows for the period under review. Bagsvaerd 2 May 2007 EXECUTIVE MANAGEMENT: Lars Rebien Sorensen Jesper Brandgaard President and CEO CFO Lise Kingo Kare Schultz Mads Krogsgaard Thomsen BOARD OF DIRECTORS: Sten Scheibye Goran A Ando Chairman Vice chairman Kurt Briner Henrik Gurtler Johnny Henriksen Niels Jacobsen Anne Marie Kverneland Kurt Anker Nielsen Soren Thuesen Pedersen Stig Strobaek Jorgen Wedel Contacts for further information MEDIA: INVESTORS: Outside North America: Outside North America: Mike Rulis Mads Veggerby Lausten Tel (direct): (+45) 4442 3573 Tel (direct): (+45) 4443 7919 E-mail: mike@novonordisk.com E-mail: mlau@novonordisk.com Hans Rommer Tel (direct): (+45) 4442 4765 E-mail: hrmm@novonordisk.com In North America: In North America: Lori Moore Christian Qvist Frandsen Tel (direct): (+1) 609 919 7991 Tel (direct): (+1) 609 919 7937 E-mail: lrmo@novonordisk.com E-mail: cqfr@novonordisk.com Further information on Novo Nordisk is available on the company's internet homepage at the address: novonordisk.com APPENDIX 1 - QUARTERLY NUMBERS IN DKK (Amounts in DKK million, except number of employees, earnings per share and number of shares outstanding.)
% change 2007 2006 Q1 2006 - Q1 Q4 Q3 Q2 Q1 Q1 2007 SALES 9,818 10,487 9,583 9,727 8,946 10% Gross profit 7,498 7,906 7,246 7,475 6,531 15% Gross margin 76.4% 75.4% 75.6% 76.8% 73.0% Sales and distribution costs 3,048 3,331 2,699 2,850 2,728 12% Percent of sales 31.0% 31.8% 28.2% 29.3% 30.5% Research and development costs 1,647 1,910 1,489 1,498 1,419 16% Percent of sales 16.8% 18.2% 15.5% 15.4% 15.9% Administrative expenses 614 645 605 557 580 6% Percent of sales 6.3% 6.2% 6.3% 5.7% 6.5% Licence fees and other operating income (net) 138 88 49 59 76 82% OPERATING PROFIT 2,327 2,108 2,502 2,629 1,880 24% Operating margin 23.7% 20.1% 26.1% 27.0% 21.0% Share of profit/(loss) in associated companies (60) (112) (30) (58) (60) 0% Financial income 309 579 139 102 111 178% Financial expenses 202 165 77 182 202 0% Profit before income taxes 2,374 2,410 2,534 2,491 1,729 37% NET PROFIT 1,709 1,724 1,774 1,743 1,211 41% Depreciation, amortisation and impairment losses 509 574 600 508 460 11% Capital expenditure 444 899 671 622 595 -25% Cash flow from operating activities 2,551 359 3,520 1,768 2,091 22% Free cash flow 2,100 (439) 2,684 996 1,466 43% Equity 29,676 30,122 28,288 28,908 27,042 10% Total assets 44,742 44,692 43,744 43,145 41,299 8% Equity ratio 66.3% 67.4% 64.7% 67.0% 65.5% Full-time employees at the end of the period 24,045 23,172 23,071 22,792 22,556 7% Basic earnings per share (in DKK) 5.38 5.44 5.54 5.40 3.74 44% Diluted earnings per share (in DKK) 5.35 5.40 5.51 5.37 3.72 44% Average number of shares outstanding (million)* 317.5 317.1 320.1 322.9 323.6 -2% Average number of shares outstanding incl dilutive effect of options 'in the money' (million)* 319.7 319.2 321.8 324.5 325.2 -2% Sales by business segments: Modern insulins (insulin analogues) 3,065 3,122 2,701 2,678 2,324 32% Human insulin and insulin-related sales 3,555 3,950 3,697 3,707 3,703 -4% Oral antidiabetic products (OAD) 523 508 516 483 477 10% DIABETES CARE TOTAL 7,143 7,580 6,914 6,868 6,504 10% NovoSeven(R) 1,411 1,470 1,393 1,507 1,265 12% Growth hormone therapy 784 897 821 882 709 11% Hormone replacement therapy 406 455 383 396 373 9% Other products 74 85 72 74 95 -22% BIOPHARMACEUTICALS TOTAL 2,675 2,907 2,669 2,859 2,442 10% Sales by geographic segments: Europe ** 3,931 4,013 3,843 3,903 3,541 11% North America 3,214 3,486 3,062 2,968 2,764 16% International Operations ** 1,696 1,690 1,539 1,648 1,617 5% Japan & Oceania 977 1,298 1,139 1,208 1,024 -5% Segment operating profit: Diabetes care 1,247 1,198 1,296 1,490 998 25% Biopharmaceuticals 1,080 910 1,206 1,139 882 22%
*) For Q1 2007 the exact numbers of 'Average number of shares outstanding' and 'Average number of shares outstanding incl dilutive effect of options 'in the money" are 317,520,216 and 319,668,756 respectively. **) Comparative figures from 2006 have been adjusted in order to reflect a changed organisational structure from 1 January 2007 which transfers 8 countries, incl. Bulgaria and Romania, from International Operations to Europe. APPENDIX 2 - QUARTERLY NUMBERS IN EUR Amounts in EUR million, except number of employees, earnings per share and number of shares outstanding.) Key figures are translated into EUR as supplementary information - the translation is based on average exchange rate for income statement and exchange rate at the balance sheet date for balance sheet items.
% change 2007 2006 Q1 2006 - Q1 Q4 Q3 Q2 Q1 Q1 2007 SALES 1,317 1,406 1,285 1,304 1,199 10% Gross profit 1,006 1,060 972 1,002 875 15% Gross margin 76.4% 75.4% 75.6% 76.8% 73.0% Sales and distribution costs 409 447 361 382 366 12% Percent of sales 31.0% 31.8% 28.2% 29.3% 30.5% Research and development costs 221 256 200 201 190 16% Percent of sales 16.8% 18.2% 15.5% 15.4% 15.9% Administrative expenses 82 86 82 74 78 6% Percent of sales 6.3% 6.2% 6.3% 5.7% 6.5% Licence fees and other operating income (net) 19 11 7 8 10 82% OPERATING PROFIT 312 283 336 352 252 24% Operating margin 23.7% 20.1% 26.1% 27.0% 21.0% Share of profit/(loss) in associated companies (8) (15) (4) (8) (8) 0% Financial income 41 78 18 14 15 178% Financial expenses 27 22 11 24 27 0% Profit before income taxes 319 324 339 334 232 37% NET PROFIT 229 231 238 234 162 41% Depreciation, amortisation and impairment losses 68 77 80 68 62 11% Capital expenditure 60 121 90 83 80 -25% Cash flow from operating activities 342 48 472 237 280 22% Free cash flow 282 (59) 360 134 196 43% Equity 3,983 4,040 3,793 3,875 3,624 10% Total assets 6,005 5,994 5,866 5,784 5,534 8% Equity ratio 66.3% 67.4% 64.7% 67.0% 65.5% Full-time employees at the end of the period 24,045 23,172 23,071 22,792 22,556 7% Basic earnings per share (in EUR) 0.72 0.72 0.75 0.72 0.50 44% Diluted earnings per share (in EUR) 0.72 0.72 0.74 0.72 0.50 44% Average number of shares outstanding (million)* 317.5 317.1 320.1 322.9 323.6 -2% Average number of shares outstanding incl dilutive effect of options 'in the money' (million)* 319.7 319.2 321.8 324.5 325.2 -2% Sales by business segments: Modern insulins (insulin analogues) 411 418 363 359 311 32% Human insulin and insulin-related sales 477 530 496 497 496 -4% Oral antidiabetic products (OAD) 70 68 69 65 64 10% DIABETES CARE TOTAL 958 1,016 928 921 871 10% NovoSeven(R) 189 197 186 202 170 12% Growth hormone therapy 105 121 110 118 95 11% Hormone replacement therapy 54 61 51 53 50 9% Other products 10 12 9 10 13 -22% BIOPHARMACEUTICALS TOTAL 358 391 356 383 328 10% Sales by geographic segments: Europe ** 527 538 515 523 475 11% North America 431 467 411 398 370 16% International Operations ** 228 227 206 221 217 5% Japan & Oceania 131 174 153 162 137 -5% Segment operating profit: Diabetes care 167 161 173 200 134 25% Biopharmaceuticals 145 122 162 153 118 22%
*) For Q1 2007 the exact numbers of 'Average number of shares outstanding' and 'Average number of shares outstanding incl dilutive effect of options 'in the money" are 317,520,216 and 319,668,756 respectively. **) Comparative figures from 2006 have been adjusted in order to reflect a changed organisational structure from 1 January 2007 which transfers 8 countries, incl. Bulgaria and Romania, from International Operations to Europe. APPENDIX 3 - INCOME STATEMENT
Q1 Q1 DKK million 2007 2006 Sales 9,818 8,946 Cost of goods sold 2,320 2,415 GROSS PROFIT 7,498 6,531 Sales and distribution costs 3,048 2,728 Research and development costs 1,647 1,419 Administrative expenses 614 580 Licence fees and other operating income (net) 138 76 OPERATING PROFIT 2,327 1,880 Share of profit/(loss) in associated companies (60) (60) Financial income 309 111 Financial expenses 202 202 PROFIT BEFORE INCOME TAXES 2,374 1,729 Income taxes 665 518 NET PROFIT 1,709 1,211 BASIC EARNINGS PER SHARE (DKK) 5.38 3.74 DILUTED EARNINGS PER SHARE (DKK) 5.35 3.72 SEGMENT SALES: Diabetes care 7,143 6,504 Biopharmaceuticals 2,675 2,442 SEGMENT OPERATING PROFIT: Diabetes care 1,247 998 Operating margin 17.5% 15.3% Biopharmaceuticals 1,080 882 Operating margin 40.4% 36.1%
APPENDIX 4 - BALANCE SHEET
DKK million 31 MAR 2007 31 DEC 2006 ASSETS Intangible assets 635 639 Property, plant and equipment 20,329 20,350 Investments in associated companies 734 788 Deferred income tax assets 1,960 1,911 Other financial assets 160 169 TOTAL LONG-TERM ASSETS 23,818 23,857 Inventories 8,618 8,400 Trade receivables 5,414 5,163 Tax receivables 321 385 Other receivables 1,743 1,784 Marketable securities and financial derivatives 1,679 1,833 Cash at bank and in hand 3,149 3,270 TOTAL CURRENT ASSETS 20,924 20,835 TOTAL ASSETS 44,742 44,692 EQUITY AND LIABILITIES Share capital 674 674 Treasury shares (38) (39) Retained earnings 28,440 28,810 Other comprehensive income 600 677 TOTAL EQUITY 29,676 30,122 Long-term debt 1,172 1,174 Deferred income tax liabilities 1,992 1,998 Provision for pensions 371 330 Other provisions 880 911 TOTAL LONG-TERM LIABILITIES 4,415 4,413 Short-term debt and financial derivatives 196 338 Trade payables 1,505 1,712 Tax payables 690 788 Other liabilities 5,561 4,863 Other provisions 2,699 2,456 TOTAL CURRENT LIABILITIES 10,651 10,157 TOTAL LIABILITIES 15,066 14,570 TOTAL EQUITY AND LIABILITIES 44,742 44,692
APPENDIX 5 - STATEMENT OF CHANGES IN EQUITY
Other comprehensive income Deferred gain/loss on Share Treasury Retained Exchange rate cash flow Other DKK million capital shares earnings adjustments hedges adjustments TOTAL Q1 2007 Balance at the beginning of the year 674 (39) 28,810 156 420 101 30,122 Exchange rate adjustment of investments in subsidiaries 47 47 Deferred (gain)/loss on cash flow hedges at the beginning of the year recognised in the Income statement for the period (420) (420) Deferred gain/(loss) on cash flow hedges at the end of the period 306 306 Other adjustments (10) (10) Net income recognised directly in equity - - - 47 (114) (10) (77) Net profit for the period 1,709 1,709 Total income for the period - - 1,709 47 (114) (10) 1,632 Share-based payment 25 25 Purchase of treasury shares - Sale of treasury shares 1 117 118 Dividends (2,221) (2,221) BALANCE AT THE END OF THE PERIOD 674 (38) 28,440 203 306 91 29,676 Q1 2006 Balance at the beginning of the year 709 (61) 26,962 142 (345) 227 27,634 Exchange rate adjustment of investments in subsidiaries 118 118 Deferred (gain)/loss on cash flow hedges at the beginning of the year recognised in the Income statement for the period 345 345 Deferred gain/(loss) on cash flow hedges at the end of the period (29) (29) Other adjustments (16) (16) Net income recognised directly in equity - - - 118 316 (16) 418 Net profit for the period 1,211 1,211 Total income for the period - - 1,211 118 316 (16) 1,629 Share-based payment 25 25 Purchase of treasury shares (2) (355) (357) Sale of treasury shares 1 55 56 Dividends (1,945) (1,945) BALANCE AT THE END OF THE PERIOD 709 (62) 25,953 260 (29) 211 27,042
APPENDIX 6 - CONDENSED CASH FLOW STATEMENT
DKK million Q1 2007 Q1 2006 NET PROFIT 1,709 1,211 Adjustment for non-cash items 1,706 1,388 Income taxes paid and net interest received (804) (579) CASH FLOW BEFORE CHANGE IN WORKING CAPITAL 2,611 2,020 Net change in working capital (60) 71 CASH FLOW FROM OPERATING ACTIVITIES 2,551 2,091 Net investments in intangible assets and long-term financial assets (7) (30) Capital expenditure for property, plant and equipment (444) (595) Net change in marketable securities (maturity exceeding three months) 4 510 NET CASH USED IN INVESTING ACTIVITIES (447) (115) CASH FLOW FROM FINANCING ACTIVITIES (2,111) (2,286) NET CASH FLOW (7) (310) Unrealised gain/(loss) on exchange rates and marketable securities included in cash and cash equivalents (5) (4) NET CHANGE IN CASH AND CASH EQUIVALENTS (12) (314) Cash and cash equivalents at the beginning of the year 2,985 2,483 CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 2,973 2,169 Bonds with original term to maturity exceeding three months 997 999 Undrawn committed credit facilities 7,451 7,462 FINANCIAL RESOURCES AT THE END OF THE PERIOD 11,421 10,630 Cash flow from operating activities 2,551 2,091 + Net cash used in investing activities (447) (115) - - Net change in marketable securities (maturity exceeding three months) 4 510 FREE CASH FLOW 2,100 1,466 Stock Exchange Announcement no 9 / 2007
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf of the undersigned, thereunto duly authorized. Date: May 04 2007 NOVO NORDISK A/S --------------------------------------------------- Lars Rebien Sorensen, President and Chief Executive Officer -----END PRIVACY-ENHANCED MESSAGE-----