2
Directors’ report
for 2023
Operating performance
Vistin Pharma is a one of the leading suppliers
of metformin, the gold standard treatment for
type II diabetes.
Diabetes is one of the most serious diseases of
this century. The number of diabetes II patients
are by WHO expected to grow from
approximately 500 million today to > 750 million
in 20 years. About 10% of the world’s
population in the age group between 25 – 70
years are suffering from diabetes. Vistin
Pharma is proud to play a major role in the
world in treating this disease. We treat about 40
million diabetes patients annually with our
metformin product. The global demand for
metformin is expected to grow by approximately
23.000 MT to 85.000MT by 2028.
Vistin Pharma´s ambition is to strengthen its
position as one of the leading global suppliers in
the metformin market and take advantage of the
expected growing market demand in the coming
years.
Vistin Pharma believes that the quality of its
metformin products, its advanced fully
automated production facility, continuous focus
and investment in sustainable operations,
its service and delivery performance, strategic
position in Europe and close proximity to its key
premium customers are competitive advantages
and drivers for increased sales and future
growth.
Metformin capacity expansion
project (MEP)
Vistin announced in April 2020 that the Board of
Directors had approved a Metformin Capacity
Expansion Project (MEP). The objective was to
build a 2nd parallel production line and
establish a total capacity of approximately
7000MT metformin HCl annually to take
advantage of the growing need for metformin, to
treat diabetes II patients and to supply existing
and future customers increasing product
demands. The new line was installed in 1H
2022 but was not fully operational before in
2023. The ramp-up program to achieve
approximately 7000MT installed capacity has
been a primary focus throughout the year. The
manufacturing capacity by end 2023 is
approximately 6000MT of metformin
hydrochloride.
3044
3460
3630
3639
5280
0
1000
2000
3000
4000
5000
6000
2019 2020 2021 2022 2023
Production volume in metric tons
3
Strategy
Vistin is positioned as a premium supplier in the
metformin market. To strengthen the position,
Vistin is committed to invest in process and
product quality development and take
advantage of Best Available Techniques (BAT)
in its production environment. Vistin has a
separate department consisting of four highly
competent engineers dedicated to work with
process, productivity-, and quality
improvements.
Vistin Pharma’s long-term ESG vision is to have
no negative impact on environment, people and
local community by the Company’s presence.
Vistin Pharma are proud of the sustainability
achievements, the track record of deliverables
and ongoing ESG focus and investments to
further reduce the Company’s carbon footprint.
During the last years Vistin has invested more
than 25 million NOK in different ESG projects to
further reduce discharges from our
manufacturing plant in Kragerø and continuous
surveillance programs to measure any impact
on the environment from our manufacturing
activities. We are proud to say that we have
found no traces of pollution or negative impact
on the surroundings and local Kilfjord (ocean).
In 2024 we will finish our water recirculation
project which will reduce the water consumption
in the plant with approximately 80%. In addition,
we have in 2023 implemented a cooling system
to condense hydrocarbons. This is expected to
reduce the emission of greenhouse gases with
more than 95% compared to historical levels.
In December 2022 Vistin Pharma entered into a
long-term renewable hydropower energy supply
agreement with Statkraft (the largest European
supplier of re-useable energy) on competitive
terms lasting from January 2023 until 2032. We
have experienced positive effect from this
agreement in 2023 both with respect to energy
cost, stability and long-term predictability.
High demand
The demand in the market for metformin is still
high. The raw material prices have decreased
during 2023 following the Covid-19 pandemic.
The delivery situation of raw materials has been
stable during 2023, however Vistin has chosen
to keep certain elevated levels of safety stock of
key raw materials to reduce the risk of
temporary raw material shortages.
Vistin has during 2023 both renewed long term
supply agreements with existing customers and
signed supply agreements with new customers.
The company is therefor well on track to fill the
additional manufacturing volume from our
expansion project going forward.
The company also has a strategic intent to
become a European multiproduct Contract
Development and Manufacturing Organization
(CDMO) as part of its growth strategy.
Presentation of financial results
for the group
Total revenue and other income for Vistin
Pharma in 2023 amounted to MNOK 438.3
(MNOK 304.9). The revenue for both 2023 and
2022 relate exclusively to sales of metformin.
The operating profit for 2023 was MNOK 68.6
million (MNOK negative 6.1). Vistin had a net
profit of MNOK 45.6 million (net loss MNOK 4.7
million). The net profit in 2023 is driven by a
significant increase in sales volume, with
production from two lines. The loss for 2022
was driven by a planned production stop in Q1
due to installation of a new production line and
record high electricity prices.
Revenue & other income in MNOK
228
254
279
305
438
50
100
150
200
250
300
350
400
450
500
2019 2020 2021 2022 2023
4
Liquidity, financial position and
investments
2023 net cash flow from operating activities was
positive with MNOK 90.6. Net cash flow from
operating activities in same period of 2022 was
negative with MNOK 10.5
Net cash flow from investing activities in 2023
was negative with MNOK 17.7, which
represents capital expenditure and leasing
repayments. Net cash flow from investing
activities in the same period last year was
negative with MNOK 64.3 (mainly MEP 2’nd
manufacturing line investment).
Net cash flow from financing activities in 2023
was negative with MNOK 48.1, which mainly
are related to down payment of the bank
overdraft. Net cash flow from financing activities
in the same period last year was positive with
MNOK 40.5 (call on bank facility for MEP
project).
Change in cash and cash equivalents YTD
2023 was positive with MNOK 24.8. In the same
period last year, there was a net decrease in
cash and cash equivalents of MNOK 34.3.
Vistin Pharma had total assets of MNOK 403.4
as of 31 December 2023 (MNOK 407.2). The
company has a deferred tax asset of MNOK
14.6 (MNOK 28.6). Based on the financial
forecasts for the company, the deferred tax
asset is expected to be fully utilized, and thus
the full amount has been included as carrying
value in the balance sheet.
Equity by the end of December was MNOK
322.8. This equals an equity ratio of 81%.
The Financial Statements of Vistin Pharma ASA
have been prepared in accordance with the
International Financial Accounting Standards
(IFRS®) as adopted by the EU and are valid on
or after 1 January 2018.
In accordance with the Norwegian accounting
act § 3-3a, the Board of Directors confirm that
the Financial Statements have been prepared
under the assumption of going concern and that
this assumption is valid based on the Group’s
budgets and financial projections.
Events after the balance sheet date
There have not been events subsequent to the
closing date of 31 December 2023, that affects
the financials or the Company’s operational
activities.
Additional dividend of NOK 0.75 per share
approved and paid in January 2024.
The Board of Directors will propose for the AGM
an ordinary dividend of total NOK 1 per share,
to be paid partly with NOK 0.5 in June and NOK
0.5 in November
Vistin Pharma announced on the 4th of March
2024 an acquisition of a 15% share in CF
Pharma Kft. CF Pharma is an API CDMO
located in Budapest, Hungary. The transaction
price consists of a base price and an earn-out-
element, with an agreed cap of MEUR 1.6.
Organizational matters
Organization
At the end of 2023, the Group had 77
employees.
Board of Directors
At year end the board consisted of Øyvin A.
Brøymer (chairman), Bettina Banoun, Kari
Krogstad, Espen Marcussen, Øystein Stray
Spetalen, Espen Lia Gregoriussen (employee
representative) and Åse Musum (employee
representative).
5
Long and successful
growth track record
88
101
111
142
150
176
171
177
201
228
254
279
305
438
0
50
100
150
200
250
300
350
400
450
500
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Revenues Vistin Metformin (MNOK)
6
7
Sustainability
report
Corporate social responsibility
(CSR), the environment and
employees
Vistin Pharma aspires to achieve sustainable
development by having a good balance
between serving customer needs, financial
results, value creation, sustainability, and CSR.
The Board of Directors have the overall
responsibility for aligning Vistin’s strategy and
sustainability considerations, while the day-to-
day responsibility lies with the CEO, supported
by the Leadership Team. The statement of
corporate social responsibility required under
Section 3-3c of the Norwegian Accounting Act
follows below.
Corporate social responsibility
Vistin Pharma is committed to conduct its
business in a manner that adheres to the
highest industry standards within the
pharmaceutical industry, and strictly in
accordance with international and local laws
and regulations. Vistin Pharma is a socially
responsible company dedicated to promoting
decent working and environmental conditions in
the supply chains. Vistin Pharma has adopted
the general principles of UN Global Compact
with universally accepted principles for human
rights, working conditions, environment, and
anti-corruption. In pursuit of this the Group has
developed a ‘NO HARM VISION’ consisting of:
A vision to have no negative
impact on environment, people,
and local community by the
Company’s presence
A «green» and environmentally
friendly pharmaceutical company
with a “no harm” vision and “front
runner” ambition
A goal to increase manufacturing
capacity without increased
environmental impact on water,
air, and soil
8
ESG achievements and initiatives
Vistin Pharma has during the last years
invested in, completed, and implemented
several projects that significantly reduce the
environmental footprint. Building on this
success, Vistin Pharma has several ESG
initiatives ongoing:
•
Vistin continues to use only 100% hydro
powered energy to minimize carbon
footprint.
•
Vistin is completing a project in 2024 with
aim to reduce the water consumption in
the plant by >80% through recycling, incl.
reusing the hot water for heating.
•
Vistin is working on a technology project
where distillation will be fractionated into
components that can be used as raw
materials for other companies.
•
Vistin has, since 2017, been part of a
national program for surveillance of
industrial impact on fjords and effluents.
Surveillance program and ecotoxicology
test confirm that Vistin do not impact the
effluent negatively.
•
Vistin has invested MNOK 10 in a cooling
system to condense hydrocarbons. This
has reduced the total emission to air with
more than 95 % compared to historical
levels.
The Company’s manufacturing plant is located
in Kragerø, Stuttlidalen 4, Sannidal, Norway,
and its head office is located at Østensjøveien
27, Oslo, Norway.
Vistin Pharma has dedicated
considerable resources to identify, analyze,
control and reduce the emission levels at its
manufacturing plant. Vistin Pharma has
established a
system in which all process water
is being collected and analyzed, and only
discharged if the water quality is within
approved levels. The system has been fully
operational during 2023.
Vistin has a strict surveillance regime when it
comes to emission from the plant and is on a
quarterly basis reporting status to the
environmental department
(‘Miljødepartementet’).
Vistin only use well know international freight
providers for both inbound and outbound
transportation. The freight suppliers also need
to be an approved supplier according to the
Company’s internal guidelines which is based
on Good Distribution Practice (GDP) and
Supplier Code of Conduct. Vistin Pharma
expects its suppliers and business partners to
make efforts to ensure compliance to the above
principles and national laws and regulations,
and to ensure similar compliance by their sub-
suppliers.
Vistin Pharma does not accept violation of laws
against corruption, bribery, and fraud. Suppliers
and business partners shall under no
circumstance be involved in business practice
which hinders free competition. Suppliers and
business partners shall not offer Vistin Pharma
employee’s gifts or favorable conditions. Vistin
Pharma seeks to form long term relationship
with business partners, who share the values
and focus on promoting decent working and
environmental conditions in the supply chain.
Vistin Pharma’s Code of Conduct is built on
Vistin Pharma’s values and provides a
framework for what the Group considers
responsible conduct. The document has been
approved by the Board of Directors, and applies
to all employees, as well as to board members
of Vistin Pharma, and can be found at
www.vistin.com.
9
10
11
12
ESG targets and expected financial impact
Concrete actions to meet emission target and vision:
2024:
• Fine tuning and optimization of already installed process equipment in production that create emission
• Feasibility study to reduce waste and re-use waste as energy source (heating)
• Continued optimalization of VOC equipment to further reduce emissions to air
• Installation and start-up of water recycling facility
2025-30:
• Installation of equipment to reduce waste and use as energy. Both for internal use and selling Vistin’s
waste fractions as raw materials to potential customers. Take a leading position on waste handling
and circular economy.
• Stoichiometry – optimize addition of raw materials when producing Metformin
• Reduce butanol consumption in production by upgrading and optimizing process equipment
Expected costs / investments to meet target and vision:
2024: Machines & Equipment MNOK 10. Internal resources (MNOK 3)
2025: Machines & Equipment MNOK 10 Internal resources (MNOK 3)
2026-30: Machines & Equipment MNOK 25. Internal resources (MNOK 15)
13
14
People
Equal opportunities
Vistin is committed to being a responsible
employer and promotes an open and strong
corporate culture. The Company has
established practices to ensure equal
opportunities between female and male
employees, as well as between different races.
The Group had 77 employees at year-end
2023, of which 20 are females. Four employees
were part-time workers according to their own
decision. All employees are offered equal
opportunities with regards to hiring,
compensation, training and promotion
regardless of gender, age, ethnic and national
origin, religion, sexual orientation, social
background or other distinguishing
characteristics. Vistin offers full pay during
parental leave for both men and women, and in
2023 none of Vistin’s female and two of the
male employees took parental leave. On
average, the length of the parental leave was
15 weeks.
The Executive Management group in 2023
consists of four members, of which one member
is female. The Board of Directors currently has
three female members out of seven. The Board
does not consider it necessary to take further
measures to ensure equal opportunities.
Salary comparison*
*Vistin completed in 2023 a salary survey to
benchmark female’s salary compared to their
male colleagues. Adjusted for age, number of
years’ experience and formal competence the
female’s salary is on a similar level as their
males.
Vistin has not registered any involuntarily
overtime or part-time work during 2023.
Approximately 35% of the leadership roles in
the middle level is held by females.
Environment, Health and Safety (EHS)
Vistin Pharma has established a formal code of
conduct, as well a set of policies and
procedures for handling quality, health, safety
and environment. The Company is committed to
a work environment where all employees feel
safe and are valued for the diversity they bring
to the business. Vistin Pharma honors domestic
and internationally accepted labor standards
and support the protection of human rights. The
Company does not tolerate any harassment or
any act of violence or threatening behavior in
the workplace, including any sexual, age-
related, or racial harassment.
The people employed at Vistin Pharma are the
most important resource for success, and the
Company strives to create a healthy and safe
environment for all employees and contractors.
All employees are entitled to an annual review
with its immediate supervisor. For new
employees individual training programs are set
up when onboarding or after individual
evaluations. The training is tailored to each role,
tasks and duties and can include both internal
and external courses, seminars, and other
relevant arrangements.
For Vistin Pharma, QHSE (quality, health,
safety, and environment) is an integrated
element of its business, and an electronic
system is in place to monitor and follow-up any
accident incidents. Key safety indicators, such
as TRI’s (total recordable incidents), are
continuously monitored, reported and reviewed
on a continuously basis. One work-related
incident was registered in 2023.This was the
first reported TRI in Vistin, for the preceding six
years.
Category 1 1 4 78 %
Category 2 4 6 100 %
Category 4 3 36 83 %
Category 5 4 4 98 %
Category 6 4 2 96 %
Males
Category
Females
Females share
of males salary
15
The statistics of only one TRI and LTI (lost time
injury) for several consecutive years show that
the company’s focus on creating an EHS
culture and establishing barriers to minimize the
risk of accidents has been successful. Sick
leave for the year totaled 4.7% compared to
3,8%, which is well below industry average. In
order to improve the working environment,
actions are taken to reduce static load for the
operators in production and reduce exposure
towards dust, gases and chemicals.
Employee skills and job engagement
The ability to attract and retain a skilled
workforce is important for Vistin to succeed in
the long-term. Vistin’s organization and culture
are key drivers for the stakeholder value
creation. The culture is built on three core
values, which guide the daily activities:
Agile -
Means being engaged, ambitious,
flexible and attentive towards the market to
make sure customers and partners succeed
Responsive -
Means responding quickly, act
jointly to develop the best possible products and
solutions and deliver as agreed
Genuine -
Means to be open and inquisitive,
perform with integrity and responsibility and
share our knowledge, skills and experience with
customers and alliances
The company has developed a competence
matrix which clarifies required competence and
resources needed to ensure the right quality of
the products and services provided and to meet
customers’ needs. Individual training programs
are set up for each employee, either when
onboarding new workers or after individual
evaluations. The training is tailored to each role,
tasks and duties and includes tutoring and
participation at internal and external courses,
seminars, and other relevant arrangements.
2023
2022
Number of employees
77
79
Number of part-time
workers
3
2
Turnover (number of
employee's)
2
2
Sick leave
4,7 %
3,8 %
LTI (Injury w/absence)
1
0
MTC (injury w/medical
treatment)
1
0
Number of hours
worked since last LTI
122 959
174 185
% Females
26 %
28 %
% Females in
management positions
34 %
40 %
% Male parental leave
4 %
4 %
% Female parental
leave
0%
0 %
Reported
whistleblower incidents
0
0
Reported incidents of
other concerns
0
0
Number of employee's
GMP trained
77
79
16
17
Vistin impacts on UN's 17
goals to sustainability
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
0
1
2
3
4
5
6
7
8
9
10
0 1 2 3 4 5 6 7 8 9 10
IMPORTANCE TO VISTINS' STAKEHOLDERS
VISTIN'S INFLUENCE ON UN SUSTAINABILITY GOALS
18
19
20
21
Product governance
Product quality and safety
Vistin produce Metformin Active
Pharmaceutical Ingredient (API) that improve
Diabetes 2 patients’ quality of life. Metformin
API is supporting effective health care with
high efficacy and very good safety profile, and
at an affordable price to patients and health
authorities. Vistin’s mission has been to
provide safe and efficacious medicine to
patients all over the world. Today Vistin
contributes to deliver diabetes type 2 medicine
to millions of patients every day. The products
from Vistin are subject to high quality and
safety requirements and require high
competence and excellent quality systems.
Vistin’s quality management system (EQMS)
ensures that its products and services are
delivered in accordance with relevant acts,
regulations, and requirements. The company’s
QMS is based on the cGMP regulations, and
complies with national and international
standards, rules and regulations for
manufacturers and suppliers of medicinal
products. The QMS consists of a set of
policies, standard operation procedures, forms,
and work instructions to ensure that the
products meet required quality and safety
standards.
Product life cycle and
environmental footprint
Vistin operates in a highly regulated market
with regards to product quality and compliance
with requirements. The product and the
production plant are annually audited by
different national health organizations like,
NOMA, EMA, FDA, PDMA, etc. The company
has a history of delivering high quality API to
customers and a very good track record from
government audits. This is all key and an
important contributing factor to the long-term
growth and value creation for stakeholders.
Vistin has prepared a sustainability report, last
updated in 2023, to increase
environmental focus, ensure sustainable
operations and reduce its environmental
footprint. The company’s direct environmental
impact relates primarily to the production
facilities at Fikkjebakke in Kragerø. Norway,
the distribution to European countries and Asia
as well as some travelling in connection with
sales and quality/HMS audit activities.
Employees are encouraged to take
environmentally friendly options into
considerations, like minimize number of flights.
Employees are further encouraged to reduce
consumption and waste generated from their
daily business activities. Vistin has established
routines for management of chemicals and
waste.
The company’s indirect environmental impact
is mainly through the purchase of needed key
starting materials from Europe, India, and
China to be able to produce Metformin API.
Some key starting materials are produced in far
east and are transported to Europe and
Norway by long-sea. Vistin has a very low
environmental footprint compared to peers due
to use of 100% hydropower in manufacturing
22
and very low levels of emission to air, soil, and
water.
Transportation of containers of raw materials
inbound and product to customers outbound
also influence the company’s indirect
environmental footprint. Metformin API is a
high-volume product and approximately 250-
300 forty feet freight containers enter and leave
the factory on annual basis.
Vistin has a long-term relationship with the raw
material suppliers, and work with them to
continuously improve. Vistin has clear
expectations towards the suppliers in relation
to EHS matters, through supply agreements
and supplier code of conduct. Vistin aims to
increase its collaboration with freight
forwarders and raw material suppliers who
shows dedicated focus on reducing their
environmental footprint, contributing to Vistin’s
long-term goals.
Ethical business
Vistin complies with the new Norwegian
Transparency Act (‘Åpenhetsloven’) introduced
by the Norwegian Government in 2022. The
Company has published a detailed due
diligence assessment of its raw-material and
service suppliers according to the principles in
the Transparency Act. The report is available
on the company’s homepage: www.vistin.com.
23
24
25
Whistle blowing
Vistin has established routines for reporting
concerns related to illegal or unethical conduct,
including a whistle blowing channel for discrete
and confidential handling of any potential
reports. There were no reported concerns
during 2023.
Responsible selling practices
The company's products are sold either directly
to customers (B2B) or through distributors in all
continents. A standardized sales process has
been established to ensure truthful and
responsible selling practices as well as
qualification of all customers. All customer
communication is done by trained and
authorized personnel.
Data security and customer privacy
As a healthcare company, Vistin may gather
and store personal data as part of its
operations. Vistin recognizes its responsibility
of managing the data collected in a responsible
manner and keeping the data safe. The
company is subject to laws and regulations that
stipulate how personal data can be collected
and managed, such as General Data
Protection Regulation (GDPR). Strict guidelines
and procedures have been implemented to
ensure compliance. This involves regularly
reviews and development of the company’s
internal control systems and risk management
processes to continuously improve and
address existing and emerging data security
and privacy threats. To ensure a modern,
secure, and well-functioning IT platform, the
company has outsourced its IT management to
a professional service provider. Any breaches
to data security and consumer privacy will be
reported and followed up immediately. Vistin
registered no data and GDPR breaches and no
wrongful sharing of personal customer data
incidents in 2023.
Climate changes and financial
impact on Vistin’s financials
Vistin consider the short to medium term
climate impact on the company’s financials to
be rather limited. The production plant at
Fikkjebakke is highly automated and following
local strict policies in relation of emissions and
local environmental impact. The company also
have several project’s ongoing that will reduce
the climate footprint in the future. Vistin signed
a 10-year renewable power supply agreement
with Statkraft in December 2022, which
includes a Guarantee of Origin (GOG) for
renewable power. Statkraft is Europe’s largest
provider of clean renewable energy.
For the long-term the risk is more uncertain.
However, Vistin believe it is well prepared for
adopting to a future with lower emissions,
reduced climate footprint and other
environmental changes. Metformin is expected
to maintain its position as the Gold Standard
treatment for Diabetes 2 in the foreseeable
future. Today, approx. 12% of global health
expenditure is spent on diabetes and the
disease is by WHO look at as one of the most
severe epidemics in the world today, with 500-
600 million people living with the disease.
Most of these patients are dependent on a daily
intake of Metformin to have a good quality of
life.
The risk of more unpredictable weather
phenomena is currently not expected to have
any significant impact on Vistin’s supply chain
and production facility. It is likely that cost of
transportation and usage of fossil transportation
sources will increase going forward, however
such cost increases and/or cost of
transformation to new sustainable substitutions
is expected to be compensated by increased
sales prices to customers.
26
Risk exposure and risk management
Vistin Pharma’s regular business activities
entail exposure to various types of risk.
The Group proactively manages such risks,
and the Board regularly analyses its operations
and potential risk factors and takes measures to
reduce risk exposure. Vistin Pharma places a
strong emphasis on Quality Assurance and has
quality systems implemented, in line with the
requirements for the pharmaceutical industry.
Operational risk
As a pharmaceutical manufacturing company,
Vistin Pharma is exposed to several types of
risk. Fluctuations in the price and availability of
raw materials and the development in foreign
exchange (USD and EUR) are among the most
prominent. In addition, risk related to potential
regulatory changes, new medications for the
treatment of diabetes II, and environmental
issues connected to emission permits at the
Company’s plant, represent central risk factors
to the Company.
Financial risk
The financial risk of the company is principally
related to liquidity risk, credit, and risk foreign
currency risk.
Company’s main strategy to manage liquidity
risk is to maintain a strong balance sheet. Vistin
has an equity ratio of 81%. Vistin has no
interest-bearing debt of as of end December
2023.
Net cash was MNOK 26.2. Vistin has a
revolving credit facility to handle the planned
liquidity effects from ongoing growth and
investments. The Company’s liquidity is
considered solid.
Vistin has no major financial assets other than
cash and cash equivalents and trade
receivables. The trade receivables relate to
customers, the Company is tightly managing
these receivables. The Company’s overall credit
risk is considered moderate to low.
The Company's exposure to the risk of changes
in foreign exchange rates relates primarily to
Vistin Pharma’s operating activities.
Vistin Pharma offers metformin to the global
market and the Company is exposed to
currency exchange fluctuations, as most sales
are in EUR, while raw-material purchases are
mainly denominated in USD. The Group also
have foreign currency denominated cash
deposits. The Company may enter currency
hedging contracts to reduce the foreign
exchange risk.
Further details on financial risk, including the
sensitivity analysis required by IFRS, can be
found in Note 14 to the Consolidated Financial
Statements
Shareholder relations
and corporate governance
Corporate governance
The Board of Directors and Executive
Management are committed to complying with
rules and regulations that apply to Vistin
Pharma’s business. Vistin Pharma’s corporate
governance guidelines, (the “CCGP”), have
been prepared to comply with the current
Norwegian Code of Practice for Corporate
Governance (the “Code”). The CCGPs has
been prepared in accordance with Section 3-3b
of the Norwegian Accounting Act and are
available on Vistin Pharma’s website. A report
on Vistin Pharma’s corporate governance is
provided in a separate section of the annual
report for 2023.
Dividend policy
The company has an ambition to pay out 50
percent of net annual profit as dividend.
However, the size of the dividend will be
dependent on the company’s’ financial
capability and capital requirements for future
growth.
27
Investor relations
The Board of Directors and the Executive
Management of Vistin Pharma place
considerable importance on providing the
shareholders and the financial market in
general with timely, relevant, and current
information regarding the Company and its
activities, in accordance with the laws and
regulations imposed by the Norwegian
Securities Trading Act and the Oslo Stock
Exchange.
The share price has moved from NOK 15.80
per share at year end 2022, and to NOK 23.20
as of 31 December 2023, a 47% increase.
General Market Outlook
Diabetes is one of the largest global health
crises of the 21st century, and the demand for
Metformin medication is expected to continue
to grow by 5-6% annually, as it remains the
gold-standard treatment for type 2 diabetes.
Global metformin HCl demand is forecasted to
grow by approx. 23.000MT to 85.000MT by
2028. Most of Vistin Pharma’s key customers
are international pharmaceutical companies
that sell innovative and plain Metformin drug
products to the end market. The demand for
the Company’s Metformin will be dependent on
the market performance of these companies.
The demand for Metformin was not affected by
the corona epidemic or has been affected by
the current situation in Ukraine. The
vulnerability for drug supplies during both the
corona epidemic and the Ukraine situation has
been an ‘eye opener’ for the authorities, and
the need for ‘short, travelled medicines’ will be
high on the agenda going forward. Vistin is
strategically well positioned to benefit from the
expected stronger demand for local supplies
from Europe going forward.
VIstin Pharma ASA (parent company)
The parent company, Vistin Pharma ASA (the
“Company”), is a holding company, with
financial activities, but no operating activities.
The Company had a net negative profit of
MNOK 3 (negative MNOK 1.9) in 2023. Total
assets as of 31 December 2023 were MNOK
266.2 (MNOK 269.1), and the long-term
intercompany interest-bearing receivables were
MNOK 62.2 (MNOK 58) at year end 2023. The
Company’s cash balance at year end 2023 was
MNOK 1.8 (MNOK 1.4). Total shareholders’
equity at 31 December 2023 was MNOK 265.1
million (MNOK 268.1), and the equity ratio at 31
December 2023 was 99.6% (99.6%).
The Board of Directors will propose for the AGM
an ordinary dividend of total NOK 1 per share,
to be paid partly with NOK 0.5 in June and NOK
0.5 in November.
Oslo, 23 April 2024
Øyvin A. Brøymer
Chairman
Espen Marcussen
Board member
Åse Musum
Board member
Bettina Banoun
Board member
Øystein Stray Spetalen
Board member
Kari Krogstad
Board member
Espen Lia Gregoriussen
Board member
Magnus Tolleshaug
CEO
Annual report is signed electronically.
28
Responsibility Statement
We confirm that, to the best of our knowledge, the Financial Statements of 2023, which have been
prepared in accordance with IFRS Accounting Standards as adopted by EU, gives a true and fair view of
the Company’s assets, liabilities, financial position, and results of operations, and that the management
report includes a fair review of the information required under the Norwegian Securities Trading Act
section 5-5.
Oslo, 23 April 2024
Øyvin A. Brøymer
Chairman
Espen Marcussen
Board member
Åse Musum
Board member
Bettina Banoun
Board member
Øystein Stray Spetalen
Board member
Kari Krogstad
Board member
Espen Lia Gregoriussen
Board member
Magnus Tolleshaug
CEO
Annual report is signed electronically.
29
Corporate
governance policy
and annual review
1. Implementation and reporting
of Corporate Governance
In accordance with the Norwegian Code of
Practice for Corporate Governance (the “Code of
Practice), cf. the latest version dated 17 October
2018, the Board of Directors of Vistin Pharma
ASA (“Vistin Pharma” or the “Company”) has
prepared a Corporate Governance policy
document. Vistin Pharma aspires to follow the
Code of Practice as closely as possible and in
situations where the Company’s practice might
diverge from the code, an explanation or
comment will be provided.
The Board reviews the overall position of the
Company in relation to the latest version of the
Code of Practice annually and reports thereon in
the Company’s annual report in accordance with
the requirements of the continuing obligations of
stock exchange listed companies and the Code
of Practice.
The Company’s compliance with the Code of
Practice is detailed in this section of the Annual
Report and section numbers refer to the Code of
Practice’s articles. Vistin Pharma’ Corporate
Governance guidelines are published in full at
the Company’s website (www.vistin.com).
2. Business
Vistin Pharma ASA is a holding company for
Vistin Pharma AS. Vistin Pharma AS is a
pharmaceutical company producing Active
Pharmaceutical Ingredients (APIs).
Vistin Pharma’s business purpose is included in
the Company’s Articles of Association.
The Board evaluates the Company’s strategy
annually. The strategy process is followed by the
approval of the budgets and key operating
indicators for the following year, which is used as
an important tool in evaluating the continuous
performance of the Company. Vistin Pharma’s
strategy, objectives and risk management is
further described in the Directors’ Report.
3. Equity and dividends
Equity
The Company’s consolidated equity at 31
December 2023 was NOK 322.8 million,
representing an equity ratio of 81%. The Board
aims to maintain an equity ratio that remains
satisfactory in light of the Company's goals,
strategy and risk profile.
Increases in share capital
The Board will only propose increases in the
share capital when this is beneficial over the
long term for the shareholders of the Company.
At the Annual General Meeting held in May
2023, the Company received a general authority
to increase the share capital by up to NOK
8,868,918 (representing up to 20% of the
existing share capital) through the issue of new
shares for general corporate purposes, including
financing of investments, mergers and
acquisitions and employee incentive plans.
The Company’s strategy is to grow its business
organically, and potentially through acquisitions,
and the Board believes that a general authority,
without a specific purpose, is necessary to give
the Company the required flexibility to secure the
necessary financing, at the lowest possible
30
costs, and that this is in the best interest of the
Company’s shareholders. The authority is limited
in time to 15 months from the date of the general
meeting or up to the Annual General Meeting in
2024.
Vistin Pharma has also been given an
authorization to purchase its own shares, for a
number of shares limited to 10% of the total
issued shares of the Company. The authority
was given at the Annual General Meeting held in
May 2023 and is limited in time to the Annual
General Meeting in 2024.
Dividend policy
It is the Company’s objective to generate
growing predictable annual returns to the
shareholders in the form of dividends and share
appreciation. This translates to an ambition to
pay out 50 percent of net annual profit as
dividend. However, the size of the dividend will
be dependent on the company’s’ financial
capability and capital requirements for future
growth. The Board of Directors will propose for
the AGM an ordinary dividend of total NOK 1 per
share, to be paid partly with NOK 0.5 in June
and NOK 0.5 in November.
4. Equal treatment of shareholders
and transactions with close
associates
The Company has only one class of shares.
Each share entitles the holder to one vote and
there are no voting restrictions. Each share has
a nominal value of NOK 1.00. Any potential
purchase of own shares shall be carried out via
a stock exchange at market prices.
Where the Board resolves to carry out an
increase in share capital based on an authority
given to the Board, and waive the pre-emption
rights of existing shareholders, the justification
will be publicly disclosed in connection with the
increase in share capital.
Transactions with related parties shall be at
arm’s length and at fair value which, in the
absence of any other pertinent factors, shall be
at market value. All not immaterial transactions
with related parties shall be valued by an
independent third party, unless assessed and
resolved upon by the General Meeting.
Transactions with related parties are described
in Note 24 to the Consolidated Financial
Statements.
5. Freely negotiable shares
There are no limitations on trading of shares and
voting rights in the Company, and each share
gives the right to one vote at the Company's
General Meeting.
6. General Meeting
Annual General Meeting
The General Meeting is the Company’s supreme
body and elects the members of the Board.
The call for the General Meeting
The Company observes the minimum notice
period set out in the Norwegian Public Limited
Companies Act, i.e., providing 21 days
minimum notice period. The call for the General
Meeting is issued in writing via mail, or
electronically through VPS, to all shareholders
with registered addresses. Transmitted with the
summons are documents, which have sufficient
detail for the shareholders to take a position on
all the cases to be considered. Documents
relating to matters which shall be considered at
a General Meeting need not be sent to the
shareholders if the documents have been made
available to the shareholders on the Company’s
website. This also includes documents that
according to law shall be incorporated into or be
attached to the notice of the General Meeting. A
shareholder may require that documents, which
shall be considered at a General Meeting, are
sent to the shareholder.
The summons also addresses the shareholder’s
right to propose resolutions to the matters to be
resolved upon at the General Meeting and gives
31
information regarding the required steps
necessary to exercise the shareholder’s rights.
The summons and the said documents are
made available on the Company’s website at
least 21 days prior to the relevant General
Meeting.
To register for the General Meeting, a
shareholder is requested to submit a
confirmation in writing via mail or fax, or by
electronic registration directly through VPS.
The 2024 Annual General Meeting is scheduled
for 23 May in Oslo, Norway.
Voting at the General Meeting
Any shareholder is entitled to vote at the
General Meeting, and to cast a vote, a
shareholder must attend, or give a proxy, to
someone who is attending. The proxy form will
be distributed with the summons to the General
Meeting. A proxy will only be accepted if
submitted by mail, fax, or e-mail (provided the
proxy is a scanned document with signature) or
registered directly through VPS. It is not
possible to vote via the Internet, or in any other
way. For shareholders who cannot attend the
General Meeting, the Board will nominate the
Chairman or the CEO to vote on behalf of
shareholders as their proxy. To the extent
possible, the Company uses a form for the
appointment of a proxy, which allows separate
voting instructions to be given for each matter to
be considered by the meeting and for each of
the candidates nominated for election.
The attendance at the General Meeting
The Board and the management of the
Company seek to facilitate the largest possible
attendance at the General Meeting. The
chairman of the Board and the CEO will always
attend the Annual General Meeting. In addition,
the chairman of the Election Committee may
also attend the Annual General Meeting, and
other members of the Board and the Election
Committee will attend whenever practical.
The Code of Practice recommends that all
Board members and the chairman of the
Election Committee are present at the annual
general meeting.
Chairman of the meeting and minutes
The chairman of the Board, or another person
nominated by the Board, will declare the
General Meeting for open. The Code of Practice
recommends that an independent person is
appointed to chair the General Meeting.
Considering the Company’s organization and
shareholder structure the Company considers it
unnecessary to appoint an independent
chairman for the General Meeting, and this task
will for practical purposes normally be
performed by the chairman of the Board.
However, the need for an independent
chairman is evaluated in advance of each
General Meeting based on the items to be
considered at the General Meeting.
The minutes from the General Meeting are
made available at the Company’s website on
the day of the General Meeting.
7. Election Committee
The Company’s Election Committee is regulated
by article 11 if the articles of association.
The Election Committee is elected by the
General Meeting, which also appoints the
chairman of the Election Committee. The
members of the Election Committee should be
selected to ensure there is a broad
representation of shareholders’ interests.
The work
The Election Committee’s task is to propose
candidates for election to the Board of Directors
and to suggest remuneration for the Board.
The election Committee usually have direct
contact with the largest shareholders, existing
Board members and the CEO of the Company
as part of their proposal for Board members at
the annual general meeting. Shareholders may
propose board members through the chairman
32
of the Election Committee. Any proposals to the
Election Committee should be submitted in
writing to the chairman of the Election
Committee no later than 15 April. The
recommendations by the Election Committee
shall be justified.
The Election Committee currently consists of two
members, who shall be shareholders or
representatives of the shareholders, and no
more than one member of the Election
Committee shall be a member of the Board. The
members of the Election Committee are elected
for a period of two years at a time. Further
information on the duties of the Election
Committee can be found in the Instructions to
the Election Committee, which has been
approved by the General Meeting and made
available on the Company’s website.
The Election Committee’s composition is
designed to maintain its independence from the
Company’s administration.
The Election Committee currently consists of the
following members:
Eivind Devold, Chairman (member since 2021
up for election in 2025)
Nils Erling Ødegaard, (member since 2017;
up for election in 2025)
Further information on the membership is
available on the Company’s webpage.
8. The Board of Directors –
composition and independence
The chairman and the other members of the
Board are elected for a period of two years at a
time, and the Board currently consists of five
shareholder elected members. In addition, two
members are elected by the employees of the
Group. All members of the Board may be re-
elected for a period of up to two years at a time.
The Company’s Executive Management is not
represented on the Board of Directors. All the
current members of the Board are independent
of the Company’s Executive Management.
The Chairman Øyvin A. Brøymer controls
directly approx. 28% of the shares in the
Company. In electing members to the Board, it is
emphasized that the Board has the required
competence to independently evaluate the cases
presented by the Executive Management as well
as the Company's operations. It is also
considered important that the Board functions
well as a body of colleagues.
The current composition of the Board, including
Board members’ shareholding in Vistin Pharma
per the date of this annual report, is detailed on
the next page.
33
Name
Position in
the Board
Member
since
(year)
Up for
election
(year)
Committee
membership
Shareholding
in Vistin
Pharma*
Øyvin A. Brøymer
Chairman
2020
2024
Rem. Comm.
12 575 000 (1)
Bettina Banoun
Member
2018
2024
Rem. Comm.
-
Kari Krogstad
Member
2020
2024
-
Espen Marcussen
Member
2020
2024
3 519 733 (2)
Øystein Stray Spetalen
Member
2015
2025
1,557,930 (3)
Espen Lia
Gregoriussen
Member
2017
2025
-
Åse Musum
Member
2015
2025
2,201
* At 31 December 2023
1. Shares owned by Intertrade Shipping AS,
which is controlled by Chairman Øyvin A.
Brøymer
2. Shares owned by Pactum Vekst AS where
Espen Marcussen is the CEO.
3. Shares owned by Øystein Stray Spetalen, or
companies controlled by, or associated with
him.
Brief biographies on the Board members can be
found on the Company’s web page.
9. The work of the Board
The Board’s work follows an annual plan for its
work. The annual plan is generally revised in
December each year and includes the number of
meetings to be held and specific tasks to be
handled at the meetings. Typical tasks that are
handled by the Board during the year includes an
annual strategic review, review and approval of
the following year’s budget, evaluation of
management and competence required, and
continuous financial, operational and risk reviews
based on budget or prognosis. The Board has
held five meetings since the Annual General
Meeting in 2023, and to the date of this report.
The Board members attended all the Board
meetings, either in person or through digital
presence.
The instructions to the Board of Directors are
available on the Company’s website.
Remuneration Committee
The Remuneration Committee, appointed by the
Board, makes proposals to the Board on the
employment terms and conditions and total
remuneration of the CEO, and other members of
Executive Management, as well as the details of
any bonus plan for the employees. These
proposals are also relevant for other
management entitled to variable salary
payments. The Board’s instructions to the
Remuneration Committee are available on the
Company’s website. The Remuneration
Committee currently consists of Øyvin Brøymer
(Chairman) and Bettina Banoun.
Audit Committee
The Company must have an Audit Committee
appointed by the Board, for practical purposes the
full Board constitutes the Audit Committee.
34
10. Risk management and
internal control
The Board and the Executive Management shall
at all times see to that the Company has
adequate systems and internal control routines
to handle any risks relevant to the Company and
its business, hereunder that the Company’s
ethical guidelines, corporate values and
guidelines for corporate social responsibility are
maintained and safeguarded.
The Board carries out regular reviews of the
Company’s most important areas of exposure to
risk and its internal control systems. The risk
areas, changes in risk levels and how the risk is
being managed, are regularly reviewed at Board
meetings.
The company has director and officer's liability
insurance. The insurance covers the board of
directors' and management officers' legal
personal liability for pure property damage
related to the duties performed as directors and
officers.
Vistin Pharma manufactures and sells
pharmaceutical products through its subsidiary
Vistin Pharma AS. These products are produced
and sold in compliance with relevant
international and local laws and regulations
governing the pharmaceutical industry.
Accordingly, the Company has implemented risk
management systems in accordance with e.g.
GMP and EHS guidelines.
11. Remuneration of the Board
of Directors
Remuneration of Board members shall be
reasonable and based on the Board's
responsibilities, work, time invested and the
complexity of the business. The remuneration
needs to be sufficient to attract both Norwegian
and foreign Board members with the right
expertise and competence. The compensation
shall be a fixed annual amount and shall be
determined by the Annual General Meeting
based on a proposal from the Election
Committee. At the Annual General Meeting in
2023 a resolution was passed approving the
following fees until the next Annual General
Meeting in 2024: Chairman NOK 420,000,
shareholder elected Board members and
employee elected board members NOK
210,000.
For more information on remuneration of the
Board see note 23 to the Consolidated Financial
Statements.
12. Remuneration of the
Executive Management
The Board sets out the guidelines for
remuneration of Executive Management and
determines the salary and other compensation of
the CEO, pursuant to relevant laws and
regulations.
The statement regarding the determination of
salary and other remuneration to Executive
Management are presented as a separate
agenda item at the Annual General Meeting, and
any proposals for shared-based compensation
(i.e., share option, share purchase plan or
similar) would usually be included as a separate
agenda item. The statement regarding the
determination of salary and other remuneration
to Executive Management has been included in
Note 12 to the Financial Statements for Vistin
Pharma ASA.
For more information on remuneration of the
CEO and other members of Executive
Management see Note 23 to the Consolidated
Financial Statements.
35
13. Information and communication
The Board of Directors and the Executive
Management of the Company assign
considerable importance to giving the
shareholders and the financial market in general
timely, relevant, and current information about
the Company and its activities, while maintaining
sound commercial judgement in respect of any
information which, if revealed to competitors,
could adversely influence the value of the
Company.
Regular information is published in the form of
Annual Reports and interim reports and
presentations. It is the Company’s aim to publish
these reports within four weeks of the end of the
relevant period in at least three of the four
financial quarters. Vistin Pharma distributes all
information relevant to the share price to the
Oslo Stock Exchange in accordance with
applicable laws and regulations.
The Company publishes all information
concerning the Annual General Meeting, interim
reports and presentations and other
presentations on the Company website, as soon
as they are made publicly available.
The CEO and CFO hold a presentation each
quarter in connection with the release of the
interim reports, which is open to all interested
parties. The Executive Management also holds
regular meetings with shareholders and other
interested investors.
14. Take-overs
The Board shall not without specific reasons
attempt to hinder or exacerbate any attempt to
submit a takeover bid for the Company's
activities or shares, hereunder make use of any
proxy for the issue of new shares in the
Company. In situations of takeover or
restructuring, it is the Board's particular
responsibility to ascertain that all shareholders'
values and interests are protected. If a take-over
offer is made, the Board will issue a statement
making a recommendation as to whether
shareholders should or should not accept the
offer. The Board will arrange a valuation from an
independent expert that shall be made public no
later than the disclosure of the Board’s
recommendation.
15. Auditor
The Company’s external Auditor is EY.
The Auditor participates in the Board meeting
that approves the annual financial statements,
and otherwise when required. The Auditor meets
with the Board, without the Company’s Executive
Management being present, at least once a
year.
The Auditor each year presents a plan for the
implementation of the audit work, and following
the annual statutory audit presents a review of
the Company’s internal control procedures,
including identified weaknesses and proposals
for improvement.
The full Corporate Governance Policy is
published on Vistin Pharma’ home page:
www.vistin.com.
36
Vistin Pharma Group financial
statements and notes
Consolidated Statement of Comprehensive Income
For the year ended 31 December
(NOK 000's)
Note
2023
2022
Revenue
4
435 391
287 675
Other income
5
2 937
17 177
Total revenue and other income
438 329
304 853
Cost of materials
176 644
138 064
Payroll expenses
6
93 135
78 972
Depreciation, amortization and impairment
12
17 347
12 280
Other operating expenses
8
82 605
81 632
Operating profit (EBIT)
68 598
-6 095
Finance income
9
20 841
9 554
Finance costs
9
30 920
9 466
Profit/(loss) before tax
58 518
-6 008
Income tax expense
10
12 923
1 293
Profit/(loss) for the period
45 596
-4 716
Other comprehensive income
Items not to be reclassified to profit or loss in subsequent periods:
Actuarial losses on defined benefit plan
7
4 731
2 933
Income tax effect
-1 041
-722
Total comprehensive income for the period
49 285
-2 505
Comprehensive income attributable to:
Equity holders of the parent company
49 285
-2 505
Earnings per share (NOK):
Basic, profit attributable to equity holders of the parent
11
1,03 -0,11
37
Consolidated Statement of Financial Position
As at 31 December
(NOK 000's)
Note
2023
2022
ASSETS
Non-current assets
Property, plant & equipment
12
219 984
219 430
Deferred tax assets
10
14 638
28 601
Total non-current assets
234 622
248 031
Current assets
Inventories
15
80 171
83 446
Trade receivables
16
47 023
66 155
Other receivables
16
15 376
8 146
Cash and cash equivalents
17
26 204
1 435
Total current assets
168 774
159 182
Total assets
403 396
407 213
EQUITY AND LIABILITIES
Equity
Share capital
18
44 345
44 345
Share premium
206 885
206 885
Retained earnings
71 540
22 256
Total equity
322 770
273 486
Non-current liabilities
Other non-current liabilities
22
2 287
2 956
Pension liabilities
7
8 864
13 199
Total non-current liabilities
11 151
16 155
Current liabilities
Trade payables
14
18 916
25 906
Short term debt
45 141
Other current liabilities
20/22
50 558
46 526
Total current liabilities
69 473
117 573
Total liabilities
80 624
133 728
Total equity and liabilities
403 396
407 213
-
38
Oslo, 23 April 2024
Øyvin A. Brøymer
Chairman
Espen Marcussen
Board member
Åse Musum
Board member
Bettina Banoun
Board member
Øystein Stray Spetalen
Board member
Kari Krogstad
Board member
Espen Lia Gregoriussen
Board member
Magnus Tolleshaug
CEO
Annual report is signed electronically.
39
Consolidated Statement of Changes in Equity
For the year ended 31 December
Attributable to equity holders of the parent
(NOK 000's)
Note
Share capital
Share
premium
Retained
earnings
Total
Equity as at 01.01.2022
44 345
206 885
24 538
275 768
Correction
221
221
Profit (loss) for the period
-4 716
-4 716
Other comprehensive income
2 211
2 211
Total comprehensive income
-2 505
-2 505
Equity as at 31.12.2022
18
44 345
206 885
22 254
273 486
Equity as at 01.01.2023
44 345
206 885
22 254
273 486
Profit (loss) for the period
45 596
45 596
Other comprehensive income
3 690
3 690
Total comprehensive income
49 285
49 285
Equity as at 31.12.2023
18
44 345
206 885
71 540
322 770
40
Consolidated Statement of Cash flows
For the year ended 31 December
(NOK 000's)
Note
2023
2022
Cash flow from operating activities
Net profit/(loss) before income tax from operations
58 518
-6 008
Net profit/(loss) before income tax
58 518
-6 008
Adjustments to reconcile profit before tax to net cash flow:
Income tax paid
-
-
Non-cash adjustment to reconcile profit before tax to cash flow:
Depreciation, amortization, and impairment
12
17 347
12 280
Changes in working capital:
Changes in trade receivables and trade payables
13/16
12 141
-20 811
Changes in inventories
15
3 275
-40 540
Changes in other accruals and prepayments
-689
44 569
Net cash flow from operating activities
90 592
-10 510
Cash flow from investing activities
Purchase of equipment and intangibles
12
-17 901
-64 290
Interest received
220
28
Net cash flow from investing activities
-17 681
-64 262
Cash flow from financing activities
Repayment of lease liabilities
22
-904
-2 589
Dividend paid
-
-
Short term debt
21
-45 141
45 141
Interest paid
-2 098
-2 092
Cash flow from financing activities
-48 143
40 460
Net change in cash and cash equivalents
24 768
-34 312
Cash and cash equivalents beginning period
1 435
35 746
Cash and cash equivalents end period
17
26 204
1 435
41
Notes to the Financial Statement
Note 1. Corporate information
Vistin Pharma ASA ("Vistin Pharma" or the "Company") is a limited liability company, with its
registered office at Østensjøveien 27, Oslo, Norway. Vistin Pharma's shares are listed on Oslo Børs in
Norway under the ticker VISTN. The Company was incorporated on 6 March 2015.
The consolidated financial statements of Vistin Pharma for the year ended 31 December 2023 were
approved for release by the Board of Directors on 23 April 2024.
Vistin Pharma is principally engaged in the production and sale of metformin active pharmaceutical
ingredient (API) and direct compressive granulate (DC) for the international pharmaceutical industry.
42
Note 2. Summary of accounting policies
The principal accounting policies applied in the preparation of these financial statements are set out
below. These policies have been consistently applied to all the years presented, unless otherwise
stated.
The consolidated financial statements and directors’ report are prepared in English only.
2.1 Basis of preparation
The consolidated financial statements have been prepared in accordance with IFRS® Accounting
Standards as approved by the European Union and are mandatory for fiscal years beginning on or
after 1 January 2020, their interpretations adopted by the International Accounting Standards Board
(IASB) and Norwegian disclosure requirements listed in the Norwegian Accounting Act. Furthermore,
the consolidated financial statements have been prepared on a historical cost basis, except for
derivative financial instruments that have been measured at fair value. Any change in the fair value of
these instruments is recognized in the statement of profit or loss as a finance income or cost.
The functional currency of Vistin Pharma ASA is the Norwegian krone (NOK), and the Group's
presentation currency is NOK. All values are rounded to the nearest thousand (NOK 000), except
when otherwise indicated.
2.2 Basis for consolidation
The Group's consolidated financial statements comprise Vistin Pharma ASA, and entities in which
Vistin Pharma ASA has a controlling interest. The Group controls an entity when it is exposed to, or
has rights to, variable returns from its involvement with the entity and has the ability to affect those
returns through its power over the entity.
2.3 Revenue recognition
In general revenue is measured at the fair value of the consideration received, and represents the
amount received for goods supplied, and if applicable stated net of discounts, returns and value added
taxes. The Group recognizes revenue when the amount of revenue can be reliably measured; when it
is probable that future economic benefits will flow to the entity; and when specific criteria have been
met, as described below.
Revenue from contract with customers
The Group apply IFRS 15 in its accounting for contracts with customers.
The Company produce and sell metformin API, the principal ingredient in Diabetes drugs. The product
is sold in bulk for further processing into consumer grade products. The Company produce to inventory
and the product is then subsequently sold to the customer based on individual orders for the product.
Metformin API is a commodity which can be readily sourced world-wide from different producers,
however, with different quality and the reliability in supply.
Vistin has several customers, but the material part of its production is sold to a limited number of
customers (note 4). These customers indicate their needed volume on a rolling forecast basis and
Vistin allocate its planned production accordingly. However, a binding performance obligation only
arise when an actual purchase order (PO) is placed and accepted. The typical purchasing pattern is
43
Note 2. Summary of accounting policies (continued)
several smaller orders throughout the year and normally the binding order length is supply over the
next 3-6 months.
Metformin API is a commodity widely produced and sold around the world and the price is determined
based on overall worldwide supply and demand, product quality and security of supply. The Company
typically negotiate price annually with each of its main customers, and order by order with smaller
customers. The supply agreements do open for price adjustments throughout the year if specific
threshold is met (i.e., significant increased raw materials, freight, FX, etc). The selling price is mainly in
EUR and reflects the current market price. Volume discounts, bonus incentives or other variable price
elements are not applied. The purchase conditions are normally net 30-60 days, and the Company
does not consider any financing elements to the transaction.
The Company consider each individual delivery based on individual purchasing orders as delivered
when the order is shipped from its warehouse. The Company used widely accepted incoterms for its
delivery and recognize the sale in accordance with the individual sales term, normally when the
metformin has been shipped from the warehouse, or when the metformin is loaded on-board in
departing ships at port.
The Company does not consider having any contract assets or liabilities in relation to its customer
contracts. Metformin API is produced for inventory, delivered from inventory to the customer, and
invoiced when shipped. All balance sheet items are related to normal short-term sales cycles.
Government grants
Government grants, including SkatteFunn, are recognized when it is reasonably certain that the grant
will be received, and all conditions have been complied with. When the grant relates to actual
expenses incurred, it is normally recognized as income over the period necessary to match the grant
on a systematic basis to the cost that is intended to compensate. Grants are generally recognized in
Other Income in the consolidated statement for profit and loss.
2.4 Foreign currency translation
Transactions in foreign currencies are initially recorded in the functional currency (NOK) of the entity
by applying the rate of exchange as of the date of the transaction. Monetary assets and liabilities
denominated in foreign currencies are translated into the functional currency at the rate of exchange at
the balance sheet date. Foreign exchange gain or losses resulting from the settlement of such
transactions, as well as unrealized gain or losses on monetary assets and liabilities, are recognized as
financial income/cost in the consolidated statement of profit and loss.
2.5 Balance sheet classification
Vistin presents assets and liabilities in consolidated statement of financial position on current/non-
current classification. An asset is current when it is expected to be realized or intended to be sold or
consumed in normal operating cycle, held primarily for the purpose of trading, expected to be realized
within twelve months after the reporting period, or cash or cash equivalent unless restricted from being
exchanged or used to settle a liability for at least twelve months after the reporting period. All other
assets are classified as non-current. A liability is current when it is expected to settle in normal
operating cycle, it is held for primarily for the purpose of trading, it is due to be settled within twelve
months after the reporting period, or there is no unconditional right to defer the settlement of the
liability for at least twelve months after the reporting period.
44
Note 2. Summary of accounting policies (continued)
2.6 Property, plant, and equipment
Land, buildings, and fixtures comprise mainly of the metformin production facility in Kragerø.
The production facility is used in production of pharmaceutical products sold by Vistin Pharma AS.
Other equipment is mainly made up of machines used in production, as well as office related
equipment and vehicles.
Property, plant, and equipment is stated at historical cost, less depreciation and/or impairment losses,
if any. Such cost includes expenditures that are directly attributable to the acquisition of the items.
Costs accrued for major replacements and upgrades to equipment are added to cost if it is probable
that the costs will generate future economic benefits and if the costs can be reliably measured, and
assets replaced are retired.
Expenditures for maintenance, repairs and periodic maintenance applicable to production facilities and
production equipment are capitalized in accordance with IAS 16. Expenditures that regularly occur at
shorter intervals are expensed as incurred.
Land is not depreciated. Depreciation on other assets is calculated on a straight-line method to
allocate their cost to their residual values over their estimated useful lives as follows:
Buildings and fixtures: 20 - 25 years
Other equipment: 3 - 10 years
The residual values, useful lives, and methods of depreciation of production and lab equipment and
other equipment are reviewed at each financial year end and adjusted, if appropriate.
2.7 Inventories
Inventories are stated at the lower of cost and net realizable value. Cost is determined using the first-
in-first-out (FIFO) method. The cost of finished goods comprises materials, direct labor, other direct.
Costs and related production overheads (based on normal operating capacity). Net realizable value is
the estimated selling price in the ordinary course of business, less variable selling expenses.
Inventories include finished goods and work-in-progress produced by the Group. The cost of finished
goods comprises materials, direct labor, other direct costs and related production overheads. The
allocation of labor costs and other direct and indirect production costs are estimated based on a
standard cost model assuming normal operating capacity and production volumes, and any changes in
these assumptions could result in adjustments to the carrying amount of inventories. The Group has in
2023 done quarterly unit cost updates to best reflect the value of inventory at hand.
2.8 Financial assets
IFRS 9 contains three principal classification categories for financial assets; measured at amortized
cost, fair value through Other Comprehensive Income and fair value through profit or loss.
The classification of financial assets of the Group at initial recognition depends on the financial asset’s
contractual cash flow characteristics and the Group’s business model for managing them. With the
exception of trade receivables that do not contain a significant financing component, the Group initially
measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through
profit or loss, transaction costs.
45
Note 2. Summary of accounting policies (continued)
Financial assets at amortized cost
The Group measures financial assets at amortized cost if both of the following conditions are met:
o the financial asset is held within a business model with the objective to hold financial assets in
order to collect contractual cash flows, and
o the contractual terms of the financial asset give rise on specified dates to cash flows that are
solely payments of principal and interest on the principal amount outstanding
Financial assets at amortized cost are subsequently measured using the effective interest (EIR)
method and are subject to impairment. Gains and losses are recognized in profit or loss when the
asset is derecognized, modified or impaired.
Financial assets at fair value through OCI
The Group measures debt instruments at fair value through OCI if both of the following conditions are
met:
o the financial asset is held within a business model with the objective of both holding to collect
contractual cash flows and selling, and
o the contractual terms of the financial asset give rise on specified dates to cash flows that are
solely payments of principal and interest on the principal amount outstanding
For debt instruments at fair value through OCI, interest income, foreign exchange revaluation and
impairment losses or reversals are recognized in the statement of profit or loss and computed in the
same manner as for financial assets measured at amortized cost. The remaining fair value changes
are recognized in OCI. Upon derecognition, the cumulative fair value change recognized in OCI is
recycled to profit or loss.
Financial assets at fair value through profit
Financial assets at fair value through profit or loss include financial assets held for trading, financial
assets designated upon initial recognition at fair value through profit or loss, or financial assets
mandatorily required to be measured at fair value. Financial assets are classified as held for trading if
they are acquired for the purpose of selling or repurchasing in the near term.
Cash and cash equivalents
Cash and cash equivalents include cash at banks and on hand and other short-term highly liquid
investments with original maturities of three months or less. In the consolidated balance sheet, any
bank overdrafts are shown within short-term debt in current liabilities.
Trade receivables and other receivables
Trade and other receivables are classified at amortized cost and recognized at the original invoiced
amount less an allowance for doubtful receivables. The group applies a simplified approach to provide
for lifetime Expected Credit Losses (ECL) in accordance with IFRS 9.
46
Note 2. Summary of accounting policies (continued)
2.9 Financial liabilities
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit
or loss, loans and borrowings, or payables, as appropriate. All financial liabilities are recognized
initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable
transaction costs. The Group’s financial liabilities principally include trade and other payables, loans
and borrowings including bank overdrafts.
Trade and other payables
Trade payables are recognized at the original invoiced amount. Other payables are recognized initially
at fair value.
Interest bearing liabilities
Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are
subsequently carried at amortized cost using the effective interest rate (EIR) method.
2.10 Financial derivatives
The Group may use forward currency contracts to hedge its foreign currency risks. Such derivative
financial instruments are initially recognized at fair value on the date on which a derivative contract is
entered into and are subsequently remeasured at fair value. Derivatives are carried as financial assets
when the fair value is positive and as financial liabilities when the fair value is negative. Any change in
the fair value of these instruments is recognized in the statement of profit or loss as a finance income
or cost.
2.11 Equity
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new
shares or options are shown in equity as a deduction, net of tax, from the proceeds.
2.12 Current and deferred income tax
Current income tax
Current income tax assets and liabilities for the current and prior periods are measured at the amount
expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to
compute the amount are those that are enacted or substantively enacted by the balance sheet date.
Deferred income tax
Deferred income tax is provided using the liability method on temporary differences at the balance
sheet date between the tax bases of assets and liabilities and their carrying amounts for financial
reporting purposes.
Deferred income tax liabilities are recognized for all taxable temporary differences except where the
deferred income tax liability arises from the initial recognition of goodwill or of an asset or liability in a
transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss.
47
Note 2. Summary of accounting policies (continued)
A deferred tax asset is recognized to the extent that is probable that future taxable profit will be
available against for which unused tax losses and unused tax credits can be utilized. A deferred tax
assets arising from unused tax losses or tax credit are only recognized to the extent that the entity has
sufficient taxable temporary differences or there is convincing other evidence supporting the utilization
of the tax losses and tax credits. The carrying amount of deferred tax asset is reviewed at the end of
each reporting period. Unrecognized deferred tax assets are reassessed at each balance sheet date
and are recognized to the extent that it has become probable that future taxable profit will allow the
deferred tax asset to be recovered.
Deferred income tax assets and deferred income tax liabilities are offset, if a legally enforceable right
exists to set off current tax assets against current income tax liabilities and the deferred income taxes
relate to the same taxable entity or taxation authority.
2.13 Employee benefits
The Group has a mandatory defined contribution plan for all employees. In addition, the Company has
an unfunded defined benefit plan for the CEO.
A defined contribution plan is a pension plan under which the Company pays fixed contributions to
pension insurance plans. The Company has no legal or constructive obligations to pay further
contributions if the fund does not hold sufficient assets to pay all employees the benefit relating to
employee service in the current and prior periods.
The contributions are recognized as employee benefit expense when they are due. Prepaid
contributions are recognized as an asset to the extent that a cash refund or reduction in future
payments is available. The pension obligation is funded through the Company's operations and
changes is incorporated into the P&L.
The defined benefit obligation is calculated annually by an independent actuary using the projected
unit credit method. Actuarial gains and losses arising from experience adjustments and changes in
actuarial assumptions are charged or credited to other comprehensive income in the period in which
they arise.
2.14 Share-based compensation
The Group has a long-term incentive plan (LTIP) where the executive management, in total, can
purchase shares for up to MNOK 6, at a 25% discount, with three years of binding time. The 25%
discount is earned progressively with 1/36 per month. The cost of the discount is taken through the
P&L quarterly and booked to other salary cost. The annual cost of the incentive program is not
considered material.
The General meeting in May 2023 also approved a loan facility of MNOK 6 for purchase of shares.
The loan facility has a duration of three years and can only be used as financing for purchasing of
shares in the company. If the finance option is used to purchase shares, the standard interest rate for
employee loans determined by the Norwegian Tax Administration, will be used. The potential interest
income of the financing element is taken through the P&L and booked as other interest income
quarterly. Additional information about compensation for the executive management in 2023 can be
found in the Remuneration Report.
48
Note 2. Summary of accounting policies (continued)
2.15 Provisions
General
Provisions are recognized when the Company has a present legal or constructive obligation as a result
of past events, it is more likely than not that an outflow of resources will be required to settle the
obligation and the amount can be reliably estimated. Provisions are measured at the present value of
the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects
current market assessments of the time value of the money and the risks specific to the obligation.
If the effect of the time value of money is material, provisions are discounted using a current pre-tax
rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the
increase in the provision due to the passage of time is recognized as a finance cost.
2.16 Leases
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease
liabilities include the net present value of the following lease payments:
• fixed payments (including in-substance fixed payments), less any lease incentives receivable
• variable lease payment that are based on an index or a rate
• amounts expected to be payable by the lessee under any residual value guarantees
• the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and
• payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that
option.
The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be
determined, the Company’s incremental borrowing rate is used, being the rate that the Company
would have to pay to borrow the funds necessary to obtain an asset of similar value in a similar
economic environment with similar terms and conditions.
In the cash flow statement, the part of lease payments that relates to repayment of the lease liability is
reclassified from cash flows from operations to cash flows from financing.
2.17 Events after the balance sheet date
New information on the Group’s positions at the balance sheet date is considered in the annual
financial statements. Events after the balance sheet date that do not affect the Group's position at the
balance sheet date, but which will affect the Group's position in the future, are stated if significant.
Please refer to the note: Events after the report.
2.18 New standards, interpretations, and disclosures
The IASB has amended IAS 1 and PS 2 to add guidance on applying materiality judgment to
accounting policy disclosures. Changes are adopted accordingly to this financial report, however, is
not considered to have material effect on the reporting for the Group.
Except the amendments to IAS 1 and PS 2 mentioned above, there are no new standards not yet
taken into use that is expected to materially impact the financial statements for the Group.
49
Note 3. Critical accounting estimates and judgements in terms
of accounting policies
The preparation of the Group's consolidated financial statements in conformity with IFRS requires the
use of certain critical accounting estimates and assumptions that affect the reported amounts of
revenue, expenses, assets and liabilities, and the accompanying disclosures, and the disclosures of
contingent liabilities. It also requires management to exercise its judgement in the process of applying
the Group's accounting policies. Uncertainty about these assumptions and estimates could result in
outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in
future periods. Estimates and judgements are continually evaluated and are based on historical
experience and other factors, including expectations of future events that are believed to be
reasonable under the circumstances.
In the process of applying the Group's accounting policies, management has made the following
judgements, which have the most significant effect on the amounts recognized in the financial
statements:
Inventories
Inventories include finished goods and work-in-progress produced by the Group. The cost of finished
goods comprises materials, direct labor, other direct costs and related production overheads. The
allocation of labor costs and other direct and indirect production costs are estimated based on a
standard cost model assuming normal operating capacity and production volumes, and any changes in
these assumptions could result in adjustments to the carrying amount of inventories. The Group has in
2023 done quarterly unit cost updates to best reflect the value of inventory at hand. This is driven by
volatile raw material prices and a strong increase in production volume which drives economies of
scale.
Deferred tax asset
The group is experiencing a strong demand for its Metformin product and is doubling its production
capacity to meet demand from both existing and potential new customers. Driven by the expected
market growth and the financial forecasts for the Group, the deferred tax asset at 31 December 2023
is expected to be fully utilized, and thus the full amount has been included as carrying value in the
balance sheet at year-end.
Long-term renewable energy supply agreement with Statkraft
In December 2022 Vistin entered into a long-term renewable energy supply agreement with Statkraft.
The agreement will secure a significant part of Vistin’s electricity demand on competitive terms from
1st of January 2023 and until 2032. There has been conducted a thorough consideration on how to
handle the accounting of the agreement. The agreement can either be treated as a Power Purchase
Agreement («PPA») or a Virtual PPA («VPPA»). The agreement with Statkraft is physical delivery of
electricity, based on a fixed baseload every hour, every day, throughout the year. Vistin operates its
manufacturing plant continuously throughout day and night (24/7) and is expected to utilize mainly all
of the physical baseload of electricity delivered by Statkraft, with limited ability to settle in cash. Based
on interpretation of IFRS 9 and other considerations it has been concluded that the energy supply
agreement with Statkraft is entered; with the goal of purchase electricity, only for own use. This means
that the agreement should be treated as a PPA, meaning a sales and purchase agreement were Vistin
book the electricity cost and any potential sales of the electricity, monthly and on a running base.
50
Note 4. Revenue Information
Geographic information
2023 2022 (NOK 000's) Revenue from contracts with customers: Africa 65 697 37 478 Europe 338 867 195 984 Asia 29 323 19 798 North and South America 1 505 34 415 Total revenue from contracts with customers 435 391 287 675
The information above is based on the location of the receiving Site of the customer.
Vistin has four customers with sales that amount to 10% or more of the Group's revenue, the
customers are typically large global pharmaceutical corporations:
(NOK 000's) 2023 2022 Customer A 179 174 125 001 Customer B 65 697 50 276 Customer C 61 978 37 478 Customer D 47 461 35 435
See also note 2.3 for general revenue accounting principles.
Note 5. Other income
(NOK 000's) 2023 2022 Other income 2 937 17 177 Total 2 937 17 177
Other income for 2023 mainly relates to sundry services rendered to customers. Other income in 2022
is mainly a liquidated damage compensation of MNOK ~13, in relation to delayed ramp-up of MEP
volume. The amount was part of the final settlement agreement with Afry agreed in December ‘22.
51
Note 6. Payroll expenses
(NOK 000's) 2023 2022 Salaries 67 459 60 948 Payroll tax 11 294 9 246 Pension costs - defined contribution plans 4 981 4 669 Pension costs - defined benefit plan 396 301 Other payroll costs incl. bonuses 9 006 3 809 Total payroll and payroll related costs 93 135 78 972 Average number of FTE's 75 75 *FTE: Full-time equivalent
Vistin Pharma are required to have an occupational pension plan ("tjenestepensjon"), and the
Company has a plan that meets the Norwegian requirements for mandatory occupational pension
("obligatorisk tjenestepensjon"). The Company also has a defined benefit plan for the CEO of Vistin
Pharma. Further information on the pension costs related to the defined benefit plan can be found in
Note 7.
Note 7. Post-employment benefits
The Group operates an unfunded defined benefit early retirement plan for the CEO. The plan is a
pension plan, which provides benefits in the form of a certain level of pension payable from the age of
62. The pension plan is funded through the Group's operations, which means that the Group meets
the benefit payment obligation as it falls due. Additional disclosure is provided in Note 23.
The amounts recognized in the balance sheet are determined as follows:
2023 2022 (NOK 000's) Fair value of plan assets - - Present value of unfunded obligations 8 864 13 199 Liability in the balance sheet (including local tax) 8 864 13 199
The change in the accrual for the benefit plan for the CEO of Vistin Pharma, who retired 31.12.2023, is
based on changes in assumptions for the estimated liability.
52
Note 7. Post-employment benefits (continued)
The movement in the defined benefit liability over the year is as follows:
(NOK 000's) 2023 2022 At 1 January* 13 199 15 831 Current service cost - - Local tax 49 37 Interest expense/(income) 347 264 13 595 16 132 Remeasurements: (Gain)/Loss from changes -4 731 -2 933 -4 731 -2 933 At 31 December 8 864 13 199 Net expense recognized in the Income Statement 396 301
The significant actuarial assumptions were as follows:
31.12.2023 31.12.2022 Discount rate 3,10 % 3,00 % Inflation 2,25 % 1,75 % Salary growth rate 3,50 % 3,50 % Pension growth rate 0.00 % 3,25 %
Nordea has issued a guarantee of NOK 14.2 million to cover future pension payments under the
defined befit plan for the CEO. The guarantee is covered by a pledge over the fixed assets of the
Company.
53
Note 8. Other operating expenses
2023 2022 (NOK 000's) Production costs 56 506 61 812 Sales & marketing costs 7 014 6 291 General & admin. expenses 19 085 13 529 Other operating expenses 82 605 81 632
Remuneration to the Auditors
(NOK 000's) 2023 2022 Statutory audit 635 505 Other attestation services 200 27 Tax advisory services 174 104 Total remuneration to auditors 1 099 636
Note 9. Financial items
(NOK 000's) 2023 2022 Interest income from bank deposits 220 28 Other financial income 105 44 Profit on derivative financial instruments Net foreign exchange gain 20 516 9 482 Total finance income 20 841 9 554 Interest expenses 2 098 2 092 Interest expenses leasing 168 48 Other financial expenses 216 356 Net foreign exchange loss 28 437 6 971 Total finance costs 30 920 9 466 Net finance -10 079 88
54
Note 10. Tax
Income tax calculation:
(NOK 000's) 2023 2022 Profit/(loss) before tax from operations 58 518 -6 008 Profit/(loss) before taxes 58 518 -6 008 Permanent differences 221 130 Permanent differences recognized to equity - - Changes in temporary differences 141 -48 Basis for income tax 58 880 -5 926 Income tax payable - - Tax effect of change in net deferred income tax liability/asset -13 963 743 Income tax expense -13 963 743 Income tax expense reported in the statement of comprehensive income 12 923 -1 293
Reconciliation of income tax
(NOK 000's) 2023 2022 Profit before tax 58 518 -6 008 Tax assessed at the expected tax rate (22%) 12 874 -1 322 Tax effect permanent differences, profit & loss 49 29 Income tax 12 923 -1 293
Recognized deferred tax assets & liabilities
(NOK 000's) 2023 2022 Fixed assets 56 306 43 419 Current assets 6 411 4 064 Pension liabilities -8 862 -13 197 Derivatives 3 552 -358 Tax losses carried forward (1) -123 942 -163 973 Other (2) - 40 Net income tax reduction/increase -66 536 -130 005 Net deferred tax asset/-liability 14 638 28 601 Tax rate applied 22 % 22 %
55
Note 10. Tax (continued)
The Group is experiencing a strong demand for its Metformin product and is doubling its production
capacity to meet demand from both existing and potential new customers. Driven by the expected
market growth and the financial forecasts for the Group, the deferred tax asset at 31 December 2023
is expected to be fully utilized, and thus the full amount has been included as carrying value in the
balance sheet at year-end.
(1) Mainly related to realized loss for closing the oil derivative contracts in Vistin Trading in 2020.
(2) Other items mainly relate to pension costs recognized directly through equity.
Note 11. Earnings per share
Basic earnings per share (EPS) are calculated by dividing the profit attributable to equity holders of the
Group by the weighted average number of ordinary shares in issue during the year.
The following reflects the income and share data used in the basic EPS computations:
2023 2022 Profit attributable to owners of the company 45 596 -4 716 Total 45 596 -4 716 Weighted average number of ordinary shares (in thousands) 44 345 44 345 Basic earnings per share (NOK) 1,03 -0,11
56
Note 12. Property, plant and equipment and right-of-use assets
Property Constructions Machines Right of Total & plants in progress & equip-use ment etc. assets (NOK 000's) Cost At 1 January 2022 28 700 83 020 91 545 5 346 208 614 Additions 14 040 8 349 37 953 3 948 64 290 Reclassified - -81 133 81 133 - - At 31 December 2022 42 741 10 236 210 631 9 294 272 904 Additions 2 357 - 15 543 - 17 900 Reclassified -366 7 678 -7 376 - -64 At 31 December 2023 44 732 17 914 218 798 9 294 290 740 Depreciation and impairment At 1 January 2022 -8 155 - -29 307 -3 731 -41 194 Depreciation charge for the year -1 681 - -9 746 -853 -12 280 Reclassified depreciations - - - - - At 31 December 2022 -9 836 - -39 053 -4 584 -53 474 Depreciation charge for the year -2 284 - -14 013 -1 051 -17 348 Reclassified depreciations - - 64 - 64 At 31 December 2023 -12 118 - -53 002 -5 635 -70 756 Net book value At 31 December 2023 32 615 17 914 165 796 3 659 219 984 At 31 December 2022 32 905 10 236 171 578 4 710 219 430 Useful life 20-25 years 3-10 years 3 years
Note 13. Financial assets and liabilities
Set out below is a comparison by class of carrying amounts and fair values of all financial instruments
that are carried in the financial statements.
The financial assets principally consist of trade receivables and cash and cash equivalents obtained
through the operating business. The financial liabilities principally consist of trade and other payables
arising directly from its operations. The fair value of the financial assets and liabilities are included at
the amount at which the instrument could be exchanged in a current transaction between willing
parties.
The Group uses the following hierarchy for determining and disclosing the fair value of financial
instruments by valuation technique:
Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.
57
Note 13. Financial assets and liabilities (continued)
Level 2: other techniques for which all inputs that have a significant effect on the recorded fair value
are observable, either directly or indirectly.
Level 3: techniques that use inputs that have a significant effect on the recorded fair value that are not
based on observable market data.
As of 31 December 2023: Fair value Loans and Other Total book Fair value level receivables financial value at amortized liabilities at cost amortized cost (NOK 000's) Financial assets Trade receivables 3 47 023 - 47 023 47 023 Other receivables 3 15 376 - 15 376 15 376 Cash at bank 3 26 204 - 26 204 26 204 Total 88 603 - 88 603 88 603 Financial liabilities Trade payables 3 - 18 916 18 916 18 916 Other payables 3 - 50 558 50 558 50 558 Total - 69 473 69 473 69 473
31 December 2022: Fair Fair value Loans and Other Total book Fair value value through receivables financial value level profit and at amorti-liabilities at loss zed cost amortized cost (NOK 000's) Financial assets Trade receivables 3 - 66 155 - 66 155 66 155 Other receivables 3 - 8 146 - 8 146 8 146 Cash at bank 3 - 1 435 - 1 435 1 435 Total - 75 736 - 75 736 75 736 Financial liabilities Trade payables 3 - 25 906 25 906 25 906 Short term debt 3 - 45 141 45 141 45 141 Other payables 3 - 46 526 46 526 46 526 Total - 117 573 117 573 117 573
For trade receivables, accounts payable and other short-term items, fair values are equal to carrying
values due to their short-term nature. The short-term debt in 2022 has been paid down in full during
2023 with positive operational cash flow.
58
Note 14. Financial risk management
The Group is exposed to a variety of financial risks, principally credit, currency, price and liquidity risks,
which are summarized below. The Group's senior management oversees the management of these
risks, which is being reviewed by the Board of Directors on a regular basis.
Credit risk
Credit risk is the risk that counterparty will not meet its obligations under related to a customer
contract, leading to a financial loss. The Group is exposed to credit risk from its operating activities
(primarily trade receivables) and from its investing and financing activities, principally deposits with
banks.
Customer credit risk
Customer credit risk is managed by established policy, procedures and control relating to customer
credit risk management. Credit quality of a customer is assessed on an individual basis, and
outstanding trade receivables are regularly monitored. Sales to customers with an unacceptable credit
risk are covered by letter of credits, and all sales are settled in cash. For trade receivables the Group
applies a simplified approach to provide for expected credit losses as prescribed by IFRS 9. There are
no provisions for losses on trade receivables as of 31 December 2023, and there are no historic losses
of significance. The risk of counterparties not meeting their contractual obligations will normally be
related to the quality of the goods supplied.
Year ended 31.12 2023 2022 Trade receivables (NOK 000's) 47 023 66 155 Number of customers 19 16 Top 5 customers as a % of total trade receivables 85 % 83 %
Financial credit risk
Cash deposits are principally with Nordea.
Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will
fluctuate because of changes in foreign currency rates. Vistin’s exposure to the risk of changes in
foreign exchange rates relates primarily the Group's pharmaceutical business (when revenue or
expense is denominated in a different currency from the Group's presentation currency), and the
Group's foreign currency denominated cash deposits.
The Group's sales and raw material purchases are mainly denominated in EUR and USD respectively.
Vistin monitors its foreign currency exposure, both related to outstanding financial assets and liabilities
and to future foreign currency denominated operating cash flow, on an ongoing basis. The Group
utilizes foreign currency denominated bank accounts to match sales and purchases in the same
currency, and thus providing a natural hedge. The Group may enter currency hedging contracts to
reduce the foreign exchange risk.
59
Note 14. Financial risk management (continued)
Year ended 31.12 2023 2022 (Currency 000's) EUR USD EUR USD Trade Receivables 3 429 832 5 513 115 Bank accounts 38 203 -48 39 Trade Payables -132 -406 -156 -709 Net assets in EUR / USD 3 336 629 5 309 -555 Currency rates 31.12 11,24 10,17 10,51 9,86 Net assets/liabilities in NOK 37 493 6 400 55 797 -5 469
Assuming foreign currency to be reduced/increased by 5%
Foreign currency (reduction)/increase -5 % -5 % -5 % -5 % Foreign currency rate 10,68 9,66 9,98 9,37 Net assets in NOK 35 618 6 080 53 007 -5 195 Potential P&L effect (before tax) NOK -1 875 -320 -2 790 273 No potential effect on OCI
Liquidity risk
Liquidity risk is the potential loss arising from the Group's inability to meet its contractual obligations
when due. Vistin monitors its risk to a shortage of funds using rolling monthly cash flow forecasts. The
Group had cash and cash equivalents of MNOK 26.2 at 31 December 2023 (2022: MNOK 1.4) and no
interest-bearing debt. The Group has sufficient credit facilities available if needed, and the Company
assesses the liquidity risk to be low.
Year ended 31.12.2023 Less than 3 - 12 (NOK 000's) 3 months months 1 - 5 years > 5 years Total Trade Payables 18 916 - - - 18 916 Other Payables 50 558 - - 50 558 Total 69 473 - - - 69 473 Year ended 31.12.2022 Less than 3 - 12 (NOK 000's) 3 months months 1 - 5 years > 5 years Total Trade Payables 25 906 - - - 25 906 Short-term debt 45 141 - 45 141 Other Payables 46 526 46 526 Total 72 432 45 141 - - 117 573
Capital Management
For the purpose of the Group’s capital management, capital includes issued capital, share premium
and all other equity reserves attributable to the equity holders of the parent. The primary objective of
the Groups’ capital management is to maximize the shareholder value.
60
Note 14. Financial risk management (continued)
It has been the Boards’ strategy to maintain a strong balance sheet in a period with volatile external
circumstances and a strong growth for the Group. It is expected that the annual CAPEX will be lower
going forward as the final payments for the MEP project was completed in 2023. Working capital
requirements is also expected to stabilize going forward. Vistin has a credit facility available if needed.
The Group manages its capital structure and make adjustments in light of changes in the financial
performance and development of the Group. To maintain or adjust the capital structure, the Group
may adjust the dividend payment to shareholders, return capital to shareholders, sell assets or issue
new shares.
Note 15. Inventories
(NOK 000's) 2023 2022 Raw materials in transit (incl. inventory at 3rd party warehouse) 22 683 25 209 Raw materials 27 159 33 924 Produced finished goods (incl. WIP) 30 329 24 541 Provision for obsolescence - -227 Total inventories 80 171 83 446 Cost of materials 176 644 138 064
Cost of material included in the statement of comprehensive income consists of purchase of raw
materials for production, purchase of finished goods for sale, net movements in inventory, and any
inventory write-offs or adjustments.
Note 16. Trade receivables and other receivables
Trade receivables
2023 2022 (NOK 000's) Trade receivables 47 023 66 155 Trade receivables (net) 47 023 66 155 Trade receivables are non-interest bearing and are generally on terms of 30 to 60 days. As at 31 December, the ageing analysis of trade receivables is, as follows: AGING PAST DUE NOT IMPAIRED (NOK 000's) Total Current < 30 days 30-60 days 60- 90 days > 90 days 2023 47 023 45 300 1 339 384 0 0 2022 66 155 52 053 11 733 2 369 0 0 See Note 14 on credit risk of trade receivables, which explains how the Group manages credit risk.
61
Note 16. Trade receivables and other receivables (continued)
Other receivables
2023 2022 (NOK 000's) Prepayments 2 812 3 135 Other 12 564 5 011 Total other receivables 15 376 8 146
Note 17. Cash and cash equivalents
(NOK 000's) 2023 2022 Cash at banks 26 204 1 435 Cash and cash equivalents 26 204 1 435 Cash at banks earns interest at floating rates based on daily bank deposit rates.
Note 18. Issued shares and share capital
The Company's registered share capital is NOK 44,344,592 divided into 44,344,592 shares. The share
capital is fully paid. All shares have the same rights.
Number of Share capital shares (thousands) (NOK 000's) At 1 January 2022 44 345 44 345 At 31 December 2022 44 345 44 345 At 1 January 2023 44 345 44 345 At 31 December 2023 44 345 44 345 Each share has a par value of NOK 1 per share.
62
28,36 %
7,94 %
1,77 %
0,90 %
20 largest shareholders as registered as of 31 December 2023: Total no Ownership Name Note of shares share 1 12 575 000 INTERTRADE SHIPPING AS* 7,94 % HOLMEN SPESIALFOND 3 842 055 2 3 519 733 PACTUM AS* 3,88 % MP PENSJON PK 1 719 848 3 1 234 280 FERNCLIFF LISTED DAI AS* 1,69 % STORKLEIVEN AS 751 000 1,69 % AUGUST RINGVOLD AGENTUR AS 750 315 1,50 % LUCELLUM AS 720 000 1,45 % HENRIK MIDTTUN HAAVIE 601 516 1,40 % IVAR LØGES STIFTELSE 550 000 1,26 % TOM RAGNAR PRESTEGÅRD STAAVI 526 324 1,16 % CORTEX AS 508 989 1,15 % WEM INVEST AS 500 000 1,14 % DNB BANK ASA 471 881 1,13 % SANDEN EQUITY AS 468 947 1,06 % DELTA AS 410 000 1,03 % GINKO AS 400 000 3 323 650 ØYSTEIN STRAY SPETALEN* 0,78 % NIELS CATO BECKETT AALL 301 658 0,73 % NICOLAI ANDREAS EGER 284 040 Other shareholders 14 166 497 31,95 % Total number of shares 44 344 592 100,0 %
Shares owned by the Board of Directors and management as of 31 December 2023:
Intertrade shipping AS (1)
12 575 000
Pactum Vekst AS (2)
3 519 733
Ferncliff Listed DAI AS (3)
1 234 280
Magnus Tolleshaug (4)
75 000
Heggem Vegard (5)
77 360
Alexander Karlsen (6)
50 000
Hilde Hagen (7)
40 000
Åse Musum (2)
2 201
1. Chairman of the Board of Directors
2. Member of the Board of Directors
3. Controlled by board member Øystein Stray Spetalen
4. Chief Executive Officer from 01.01.2024
5. VP Operations
6. Chief Financial Officer
7. VP Quality
63
Note 19. Share-based payments
The annual general meeting in May 2023 approved a long-term incentive plan (LTIP) where the
executive management, in total, can purchase shares for up to MNOK 6, at a 25% discount, with three
years of binding time. The General meeting also approved a loan facility of MNOK 6 for purchase of
shares. The loan facility has a duration of three years and can only be used as financing for
purchasing of shares in the company. If the finance option is used to purchase shares, the standard
interest rate for employee loans determined by the Norwegian Tax Administration, will be used.
Note 20. Other payables
(NOK 000's) 2023 2022 Withholding tax 3 203 3 013 Social security taxes 2 013 1 734 Allowance for holiday pay 8 925 7 883 Accrued expenses 5 665 5 057 Other liabilities 30 761 28 838 Total other payables 50 558 46 526
Note 21. Borrowings
The Group had no interest-bearing debt as of 31 December 2023 (2022: MNOK 45.1). The Group has
a revolving credit facility in Nordea which is used when needed. The debt from 2022 has been paid
down in full during 2023 with positive operational cash flow.
Nordea has issued a guarantee of MNOK 14.2 to cover future pension payments under the defined
benefit plan for the CEO, as well as a guarantee for income tax deducted salaries of MNOK 6.5. The
guarantees are covered by a pledge of MNOK 15 in the Property (plant) located in Kragerø
municipality.
Note 22. Leasing and commitments
The Group has not applied the two recognition exemptions in the standard, for low value items and
short-term leases. There are only a few leasing agreements in total (<10), and all agreements has
been incorporated into the balance sheet. Detailed lease commitments divided by category:
Detailed Lease commitments at 31 December 2023 (NOK 000's) Property rental 3 115 Cars & trucks 493 Production equipment 53 Other office equipment 256 Future minimum lease payments 3 916
64
Note 22. Leasing and commitments (continued)
Maturity profile of lease commitments (NOK 000's) <12 months 12-24 months 24-36 months >48 months Property rental 930 930 878 376 Cars & trucks 124 83 83 202 Production equipment 53 - - Other office equipment 67 67 67 54 Future minimum lease payments 1 175 1 081 1 029 631 Details for right of use assets and Right of use Leasing leasing liabilities assets liabilities Opening balance at 1 Jan 2022 1 614 1 389 Depreciation -853 Interest expense 48 Additions 3 948 Repayment of lease liabilities 2 589 Value at year end 2022 4 710 4 026 Opening balance at 1 Jan 2023 4 710 4 026 Depreciation -1 051 Interest expense 168 Additions 461 Repayment of lease liabilities -904 Value at year end 2023 4 120 3 290 Of which are: Other current lease liabilities (2023) 1 003 Other non-current lease liabilities (2023) 2 287 3 290
There are no residual guaranties or right of termination that have significant effect on any of the lease
agreements. Incremental borrowing rate to estimate leasing interest expense is approximately 5%.
65
Note 23. Board of Directors and Executive Management compensation
Board of Directors remuneration 2023 2022 (NOK 000's) Board fees Other* Board fees Other* Øyvin A. Brøymer Chairman** 420 21 400 20 Bettina Banoun 210 21 200 20 Øystein Stray Spetalen 210 - 200 - Espen Marcussen** 210 - 200 - Kari Krogstad** 210 - 200 - Espen Lia Gregoriussen 210 - 200 - Åse Musum 210 - 200 - Total 1 680 42 1 600 40 *Both Bettina Banoun and Øyvin Brøymer received NOK 21 000 in 2023 and 20 000 in 2022 as members of the Remuneration Committee. Executive Management remuneration 2023 Proportion of fixed and Base Bonus (NOK 000's) salary paid* Pension Other** Total variable Kjell Erik Nordby, CEO 2 790 - 509 266 3 565 100% / 0% Alexander Karlsen, CFO 1 877 60 164 240 2 341 97% / 3% Hilde Merethe Hagen, VP Quality 1 538 49 165 169 1 921 97% / 3% Magnus Tolleshaug, CCO 1 812 58 162 206 2 238 97% / 3% Vegard Heggem, VP Operations 1 789 58 168 162 2 176 97% / 3% Total Executive Management 9 805 225 1 168 1 043 12 241 - *Bonus paid is related to bonus earned for 2022 and paid out in 2023 **Mainly fixed monthly car allowance 2022 Proportion of fixed and Base Bonus (NOK 000's) salary paid* Pension Other**(*) Total variable Kjell Erik Nordby, CEO 2 667 864 415 192 4 138 79% / 21% Alexander Karlsen, CFO 1 765 425 151 172 2 513 83% / 17% Hilde Merethe Hagen, VP Quality 1 462 237 152 145 1 996 88% / 12% Magnus Tolleshaug, CCO 1 638 234 154 477* 2 503 91% / 9% Vegard Heggem, VP Operations 1 707 276 153 148 2 284 88% / 12% Total Executive Management 9 239 2 036 1 025 1 134 13 434 - *Bonus paid is related to bonus earned for 2021 and paid out in 2022 **Mainly fixed monthly car allowance ***Magnus Tolleshaug received a one-time compensation of NOK 300' as interim CEO in 1H of 2022
66
Note 23. Board of Directors and Executive Management compensation
(continued)
The CEO, Kjell-Erik Nordby is tied up to the Company's defined contribution plan. In addition, he has
the right to retire at the age of 62 and is entitled to a salary equal to 60% of his salary at date of
retirement and until he reaches the age of 67, less any public pension entitlements. In addition, he has
the right to a certain level of pension from the age of 67. Refer to Note 7 for further details. Mr. Nordby
has a 24-month termination benefit in the case of involuntary termination of his employment. Kjell-Erik
Nordby retired 31.12.2023.
According to the Norwegian Public Limited Companies Act section 6-16a, the Board of Directors have
prepared a statement on the establishment of wages and other remuneration for the CEO and other
senior employees.
Note 24. Transactions with related parties
Related party relationships are those involving control, joint control or significant influence. Related
parties are in a position to enter into transactions with the Group that would not be undertaken
between unrelated parties. All transactions within the Group have been based on arm's length
principle.
The Group's ultimate parent is Vistin Pharma ASA. The shares of Vistin Pharma ASA are listed on
Oslo Børs. The subsidiary is listed in note 25. Any transactions between the parent company and the
subsidiary are shown line by line in the separate statements of the parent company and are eliminated
in the group financial statements.
See note 23 for more information on remuneration to executive management and the board.
Note 25. Subsidiary
The following subsidiaries are included in the consolidated financial statements:
Ownership Voting Ownership Voting Country of Main interest power interest power Company incorporation operations 2023 2023 2022 2022 Pharmaceutical Vistin Pharma AS Norway 100 % 100 % 100 % 100 % products
The financial figures of Vistin Pharma AS has been included in the consolidated financial statements of
the Group.
67
Note 26. Events after the reporting date
There have not been events subsequent to the closing date of 31 December 2023, that currently
affects the financials or the Group’s operational activities.
Additional dividend of NOK 0.75 per share approved and paid in January 2024.
The Board of Directors will propose for the Annual General Meeting an ordinary dividend of total NOK
1 per share, to be paid partly with NOK 0.5 in June and NOK 0.5 in November 2024.
Vistin Pharma announced on the 4
th
of March 2024 an acquisition of a 15% share in CF Pharma Kft.
CF Pharma is an API CDMO located in Budapest, Hungary with a broad customer base of recognized
international pharmaceutical companies. CF Pharma has a proven track record in developing and
commercializing Active Pharmaceutical Ingredients (APIs). The group/company currently has five
commercial APIs on the market, with another eight APIs under development. The transaction price
consists of a base price and an earn-out- element, with an agreed cap of MEUR 1.6.
68
Vistin Pharma ASA -
financial statements
and notes
Statement of Comprehensive Income
For the year ended 31 December
(NOK 000's)
Note
2023
2022
Other income
-
-
Total operating income
-
-
Payroll and payroll related costs
3
2 147
1 962
Other operating costs
4
4 831
2 232
Operating profit/(loss)
-6 978
-4 193
Finance income
5
3 247
1 835
Finance costs
5
95
15
Profit/(loss) before tax
-3 826
-2 373
Income tax expense
6
-842
-522
Profit/(loss) for the year
-2 984
-1 851
Total comprehensive income
-2 984
-1 851
69
Statement of Financial Position
As at 31 December
(NOK 000's)
Note
2023
2022
ASSETS
Non-current assets
Investment in subsidiaries
7
48 825
48 825
Group interest-bearing receivables
7
62 183
58 024
Deferred tax assets
6
2 105
1 263
Total non-current assets
113 113
108 112
Current assets
Intercompany receivables
7
151 155
159 537
Other receivables
127
47
Cash and cash equivalents
9
1 849
1 388
Total current assets
153 131
160 972
Total assets
266 244
269 084
EQUITY AND LIABILITIES
Equity
Share capital
10
44 345
44 345
Share premium
206 885
206 885
Retained earnings
13 918
16 902
Total equity
265 147
268 131
Non-current liabilities
Total non-current liabilities
-
-
Current liabilities
Accounts payables
8
2
42
Other current liabilities
8
1 094
911
Total current liabilities
1 096
953
Total liabilities
1 096
953
Total equity and liabilities
266 244
269 084
70
Oslo, 23 April 2024
Øyvin A. Brøymer
Chairman
Espen Marcussen
Board member
Åse Musum
Board member
Bettina Banoun
Board member
Øystein Stray Spetalen
Board member
Kari Krogstad
Board member
Espen Lia Gregoriussen
Board member
Magnus Tolleshaug
CEO
Annual report is signed electronically.
71
Statement of Changes in Equity
For the year ended 31 December
Attributable to equity holders of the parent
(NOK 000's)
Share capital
Share
premium
Retained
earnings
Total
Equity as at 01.01.2022
44 345
206 885
18 753
269 982
Profit (loss) for the year
-1 851
Total comprehensive income
-1 851
-1 851
Dividend
Equity as at 31.12.2022
44 345
206 885
16 902
268 131
Profit (loss) for the year
-2 984
Total comprehensive income
-2 984
-2 984
Equity as at 31.12.2023
44 345
206 885
13 918
265 147
72
Statement of Cash flows
For the year ended 31 December
(NOK 000's)
Note
2023
2022
Cash flow from operating activities
Profit before income tax
-3 826
-2 373
Adjustments to reconcile profit before tax to net cash flow:
Net interest (income)/expense
5
3 158
1 807
Income tax paid
-
-
Changes in working capital:
Changes in trade receivables and trade payables
-39
41
Changes in other payables, receivables, accruals
5 327
-20 608
Net cash flow from operating activities
4 620
-21 133
Cash flow from investing activities
Loan subsidiary
-4 159
Net cash flow from investing activities
-4 159
Cash flow from financing activities
Dividend paid
-
Net cash flow from financing activities
-
Net change in cash and cash equivalents
461
-21 133
Cash and cash equivalents beginning period
1 388
22 521
Cash and cash equivalents end period
9
1 849
1 388
73
Notes to the Financial Statement
Note 1. Corporate information
Vistin Pharma ASA is a limited liability company and its registered office is Østensjøveien 27, Oslo,
Norway. The Company's shares are listed on Oslo Børs in Norway under the ticker VISTN.
The financial statements were approved for release by the Board of Directors on 23 April 2024.
Reference is made to note 1 in the consolidated statement of Vistin Pharma ASA.
Note 2. Summary of significant accounting policies
Vistin Pharma ASA's ("Vistin Pharma" or "the Company") financial statements and directors’ report are
prepared in English only.
Basis of preparation
The financial statement has been prepared in accordance with the Norwegian Accounting Act § 3-9
and regulations regarding simplified application of IFRS® Accounting Standards issued by the Ministry
of Finance in 2014.
The functional currency of Vistin Pharma is the Norwegian krone (NOK). All values are rounded to the
nearest thousand (NOK: 000), except when otherwise indicated.
Vistin Pharma's principles are consistent to the accounting principles for the Company, as described in
Note 2 of the consolidated financial statements. Where the note for the parent company is
substantially different from the note for the Company, these are shown separately. Otherwise refer to
the note in the consolidated financial statement.
Investments in subsidiaries
Investments in subsidiaries and associates are accounted for using the cost method in the parent
company accounts. The investments are valued at cost less impairment losses. Write-down to fair
value is recognized under impairment in the income statement.
Recognition for group contributions
Company contributions from wholly owned subsidiaries are recorded as financial income as long as
the contributions do not exceed the accumulated results from the date of acquiring the subsidiary. The
income is recorded net of tax. Company contributions relating to the result prior the date of acquisition
is recorded as a reduction against the investment (net of tax). If company contributions exceed
accumulated profits in the subsidiary after the acquisition, the payment is treated as a reduction of the
carrying value of the investment.
74
Note 3. Payroll and payroll related expenses
(NOK 000's)
2023
2022
Other payroll costs
2 147
1 962
Total payroll and payroll related costs
2 147
1 962
Average number of man-years:
-
-
The Company had no employees as of 31 December 2023 (2022: 0). Other payroll costs relate to
board fees.
Note 4. Other operating expenses
(NOK 000's)
2023
2022
External fees
728
1 505
Other operating expenses
4 103
726
Other operating expenses
4 831
2 232
Remuneration to the Auditors
(NOK 000's)
2023
2022
Statutory audit
315
320
Other assurance services
348
163
All fees are exclusive of VAT.
Note 5. Financial items
(NOK 000's)
2023
2022
Interest income from bank deposits
89
28
Interest income from Group companies
3 158
1 807
Total finance income
3 247
1 835
Other interest expenses
95
15
Total finance costs
95
15
Net finance
3 152
1 820
75
Note 6. Tax
(NOK 000's)
2023
2022
Profit before taxes
-3 826
-2 373
Permanent differences
-
-
Changes in temporary differences
-
-
Permanent differences recognized to equity
-
-
Basis for income tax
-3 826
-2 373
Income tax payable
-
-
Tax effect of change in net deferred income tax liability/asset
-842
522
Tax effect permanent differences recognized to equity
-
-
Tax effect tax rate reduction
-
-
Income tax expense
-842
522
Reconciliation of income tax
(NOK 000's)
2023
2022
Tax assessed at the expected tax rate
842
522
Tax effect permanent differences, profit & loss
-
-
Income tax
842
522
Temporary differences
(NOK 000's)
2023
2022
Losses carried forward
-9 567
-5 741
Net income tax reduction temporary differences
-9 567
-5 741
Net deferred tax asset
2 105
1 263
76
Note 7. Investments in group companies
2023
(NOK 000's)
Registered
office
Share
capital
Ownership
interest
2023
Voting
rights 2023
Carrying
amount
Result
2023
Equity 2023
Vistin Pharma
AS
Oslo,
Norway
NOK
100 %
100 %
48 825
48 579
106 448
Total
48 825
48 579
106 448
2022
(NOK 000's)
Registered
office
Share
capital
Ownership
interest
2022
Voting
rights 2022
Carrying
amount
Result
2022
Equity 2022
Vistin Pharma
AS
Oslo,
Norway
NOK
100 %
100 %
48 825
-2 864
54 178
Total
48 825
-2 864
54 178
Transactions between related parties
2023
(NOK
000's)
Long term
receivables to
subsidiaries
Short term
receivables
to subsi-
diaries
Interest
income from
subsidiaries
Short term
payables to
subsidiaries
Group
contribution
receivable
Group
contribution
payable
Vistin Pharma AS
62 183
151 155
3 158
-
-
-
Total
62 183
151 155
3 158
-
-
-
2022
(NOK
000's)
Long term
receivables to
subsidiaries
Short term
receivables
to
subsidiaries
Interest
income from
subsidiaries
Short term
payables to
subsidiaries
Group
contribution
receivable
Group
contribution
payable
Vistin Pharma AS
58 024
159 537
1 807
-
-
Total
58 024
159 537
1 807
-
-
The loan to Vistin Pharma AS carries an annual interest rate of 3 months NIBOR + 1.25%, to be paid
quarterly in arrears.
77
Note 8. Financial assets and liabilities
The Company uses the following hierarchy for determining and disclosing the fair value of financial
instruments by valuation technique:
Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.
Level 2: other techniques for which all inputs that have a significant effect on the recorded fair value
are observable, either directly or indirectly.
Level 3: techniques that use inputs that have a significant effect on the recorded fair value that are not
based on observable market data.
As of 31 December 2023
(NOK 000's)
Fair
value
level
Fair
value
through
profit
and loss
Loans and
receivables
at
amortized
cost
Other
financial
liabilities at
amortized
cost
Total
book
value
Fair
value
Financial assets
Group interest-bearing receivables
3
-
62 183
-
62 183
62 183
Intercompany receivables
3
-
151 155
-
151 155
151 155
Other receivables
3
-
127
-
127
127
Cash and cash deposits
3
-
1 849
-
1 849
1 849
Total
-
215 315
-
215 315
215 315
Financial liabilities
Intercompany payables
3
-
-
-
-
-
Trade payables
3
-
-
2
2
2
Other payables
3
-
-
1 094
1 094
1 094
Total
-
-
1 096
1 096
1 096
As of 31 December 2022
(NOK 000's)
Fair
value
level
Fair
value
through
profit
and loss
Loans
and recei-
vables at
amortized
cost
Other
financial
liabilities at
amortized
cost
Total
book
value
Fair
value
Financial assets
Group interest-bearing receivables
3
58 024
-
58 024
58 024
Intercompany receivables
3
-
159 537
-
159 537
159 537
Other receivables
3
-
47
-
47
47
Cash and cash deposits
3
-
1 388
-
1 388
1 388
Total
218 996
-
218 996
218 996
Financial liabilities
Intercompany payables
3
-
-
-
-
-
Trade payables
3
-
-
-
-
-
Other payables
3
-
-
911
911
911
Total
-
-
911
911
911
78
Note 8. Financial assets and liabilities (continued)
Set out above is a comparison by class of carrying amounts and fair values of all of the Company’s
financial instruments that are carried in the financial statements. For trade receivables, accounts
payable and other short-term items, fair values are considered to be equal to carrying values due to
their short-term nature.
Note 9. Cash and cash equivalents
(NOK 000's)
2023
2022
Cash at banks
1 849
1 388
Total
1 849
1 388
Cash at banks earns interest at floating rates based on daily bank deposit rates. All bank accounts
are nominated in NOK.
Note 10. Issued shares and share capital
The Company's registered share capital is NOK 44,344,592 divided into 44,344,592 shares. The share
capital is fully paid. All shares have the same rights.
Number of
shares
Share capital
(thousands)
(NOK 000's)
At 1 January 2022
44 345
44 345
At 31 December 2022
44 345
44 345
At 1 January 2023
44 345
44 345
At 31 December 2023
44 345
44 345
Each share has a par value of NOK 1 per share.
79
Note 10. Issued shares and share capital (continued)
20 largest shareholders as registered as of 31 December 2023:
Name
Note
Total no
of shares
Ownership
share
INTERTRADE SHIPPING AS*
1
12 575 000
28,36 %
HOLMEN SPESIALFOND
3 842 055
7,94 %
PACTUM AS*
2
3 519 733
7,94 %
MP PENSJON PK
1 719 848
3,88 %
FERNCLIFF LISTED DAI AS*
3
1 234 280
1,77 %
STORKLEIVEN AS
751 000
1,69 %
AUGUST RINGVOLD AGENTUR AS
750 315
1,69 %
LUCELLUM AS
720 000
1,50 %
HENRIK MIDTTUN HAAVIE
601 516
1,45 %
IVAR LØGES STIFTELSE
550 000
1,40 %
TOM RAGNAR PRESTEGÅRD STAAVI
526 324
1,26 %
CORTEX AS
508 989
1,16 %
WEM INVEST AS
500 000
1,15 %
DNB BANK ASA
471 881
1,14 %
SANDEN EQUITY AS
468 947
1,13 %
DELTA AS
410 000
1,06 %
GINKO AS
400 000
1,03 %
ØYSTEIN STRAY SPETALEN*
3
323 650
0,90 %
NIELS CATO BECKETT AALL
301 658
0,78 %
NICOLAI ANDREAS EGER
284 040
0,73 %
Other shareholders
14 166 497
31,95 %
Total number of shares
44 344 592
100,0 %
Shares owned by the Board of Directors and management as of 31 December 2023:
Intertrade shipping AS (1)
12 575 000
Pactum Vekst AS (2)
3 519 733
Ferncliff Listed DAI AS (3)
1 234 280
Magnus Tolleshaug (4)
75 000
Heggem Vegard (5)
77 360
Alexander Karlsen (6)
50 000
Hilde Hagen (7)
40 000
Åse Musum (2)
2 201
1. Chairman of the Board of Directors
2. Member of the Board of Directors
3. Controlled by board member Øystein Stray Spetalen
4. Chief Executive Officer from 01.01.2024
5. VP Operations
6. Chief Financial Officer
7. VP Quality
80
Note 11. Events after the reporting period
There have not been events subsequent to the closing date of 31 December 2023, that affects the
financials or the company’s operational activities.
The Board of Directors will propose for the Annual General Meeting an ordinary dividend of total NOK
1 per share, to be paid partly with NOK 0.5 in June and NOK 0.5 in November 2024.
Note 12. Statement regarding the determination of salary and other
remuneration to Executive Management
According to the Norwegian Public Limited Companies Act (section 6-16a), the Board of Directors shall
prepare a statement regarding the establishment of wages and other remuneration for the Chief
Executive Officer and other senior management.
The Company’s salary policy for the executive management – main principles
The purpose of the Company's remuneration policy is to attract and retain personnel with the
competence that the Group requires with a view to achieve Vistin Pharma's goal of becoming a
leading and a profitable producer of selected API's for the international pharmaceutical market. The
general policy is to pay fixed salaries and pensions, while at the same time offering bonuses, or other
types of remuneration, which aligns the interest of senior management and the shareholders of the
Company.
The Company has a separate remuneration committee appointed by the Board of Directors. The
present remuneration committee consists of Øyvin A. Brøymer (Chairman) and Bettina Banoun. The
CEO, and other representatives of the senior management, regularly participates in the remuneration
committee's meetings.
The remuneration committee functions as an advisory body for the Board of Directors and its main
duties and responsibilities are to:
i. Review and approve corporate goals and objectives relevant to the compensation of the CEO,
evaluate the performance of the CEO in light of those goals and objectives and set the
compensation level for the CEO based on this evaluation. In determining the long-term
incentive component of the CEO compensation, if any, the Committee may consider the
Company’s performance and relative shareholder return, the value of similar incentive awards
given to CEOs at comparable companies and the awards given to the CEO in past years.
ii. Make recommendations to the Board with respect to incentive-compensation plans and equity-
based plans.
iii. Assist the Board in developing and evaluating potential candidates for executive positions,
including the CEO, and oversee the development of executive succession plans.
iv. Review and approve Senior Executive employment agreements, severance arrangements and
change in control agreements and provisions when, and if, appropriate, as well as any special
supplemental benefits.
81
Note 12. Statement regarding the determination of salary and other
remuneration to Executive Management (continued)
v. Review major organizational and staffing matters.
Further information on the function of the remuneration committee can be found in the instructions to
the remuneration committee, included on the Company's website: www.vistin.com.
Salaries and other remuneration
Fixed salary
It is the Company’s policy that salaries to the CEO and senior management primarily shall take the
form of a fixed monthly salary, reflecting the level of the position and experience of the person
concerned and the results achieved.
Bonuses
The Group has a system of annual performance-based bonuses for all employees. The maximum
bonus payable to the CEO is 40% of the annual salary. The maximum bonus payable to other
members of the Executive Management team is 30% of the annual salary, depending on individual
employment contracts. The Board of Directors evaluates and determines annually the bonus system
for Vistin Pharma, based on recommendations from the Remuneration Committee. The bonuses are
linked to the achievement of certain targets for financial results, as well other performance targets
which are defined at the beginning of the financial year. The bonus targets shall reflect both short-term
financial parameters, and operational and strategic performance targets that are expected to give a
positive long-term financial effect.
Pension plan
Principally, pension plan shall be the same for senior management as what is generally agreed for
other employees. The Group has a defined contribution plan for all employees. Under this plan the
Group contributes 5.5% of the salary between 1G and 7.1G, and 15%, for the salary between 7.1G
and 12G. The CEO per 31.12.2023 (Kjell-Erik Nordby) has an additional "top-hat" to cover salary
above 12G, as well as an early retirement plan from the age of 62.
Notice period
The CEO has a six-month termination period, and the remaining executive management team has a
three-month termination period.
Share based incentive plans
The annual general meeting in May 2023 approved a long-term incentive plan (LTIP) where the
executive management, in total, can purchase shares for up to MNOK 6, at a 25% discount, with three
years of binding time. The General meeting also approved a loan facility of MNOK 6 for purchase of
shares. The loan facility has a duration of three years and can only be used as financing for
purchasing of shares in the company. If the finance option is used to purchase shares, the standard
interest rate for employee loans determined by the Norwegian Tax Administration, will be used.
Remuneration policy in the preceding financial year (2023)
The management remuneration policy in the preceding financial year has been conducted in
accordance with the prevailing principles for 2023.
82
Vistin Pharma ASA
Østensjøveien 27
NO-0661 Oslo
Norway
Tel: +47 35 98 42 00
E-mail: vistin@vistin.com
www.vistin.com
Statsautoriserte revisorer
Ernst & Young AS
Stortorvet 7, 0155 Oslo
Postboks 1156 Sentrum, 0107 Oslo
Foretaksregisteret: NO 976 389 387 MVA
Tlf: +47 24 00 24 00
www.ey.no
Medlemmer av Den norske Revisorforening
A member firm of Ernst & Young Global Limited
INDEPENDENT AUDITOR'S REPORT
To the Annual Shareholders' Meeting of Vistin Pharma ASA
Report on the audit of the financial statements
Opinion
We have audited the financial statements of Vistin Pharma ASA (the Company) which comprise the
financial statements of the Company and the consolidated financial statements of the Company and its
subsidiaries (the Group). The financial statements of the Company comprise the financial position as at
31 December 2023 and the statement of comprehensive income, statement of cash flows and statement
of changes in equity for the year then ended and notes to the financial statements, including a summary
of significant accounting policies. The consolidated financial statements of the Group comprise the
financial position as at 31 December 2023 statement of comprehensive income, statement of cash flows
and statement of changes in equity for the year then ended and notes to the financial statements,
including material accounting policy information.
In our opinion
• the financial statements comply with applicable legal requirements,
• the financial statements give a true and fair view of the financial position of the Company as at 31
December 2023 and its financial performance and cash flows for the year then ended in
accordance with simplified application of international accounting standards according to section
3-9 of the Norwegian Accounting Act,
• the consolidated financial statements give a true and fair view of the financial position of the
Group as at 31 December 2023 and its financial performance and cash flows for the year then
ended in accordance with IFRS Accounting Standards as adopted by the EU.
Our opinion is consistent with our additional report to the audit committee.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our
responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of
the financial statements section of our report. We are independent of the Company and the Group in
accordance with the requirements of the relevant laws and regulations in Norway and the International
Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants
(including International Independence Standards) (IESBA Code), and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit
Regulation (537/2014) Article 5.1 have been provided.
We have been the auditor of the Company for 9 years from the election by the general meeting of the
shareholders in 2015 for the accounting year 2015.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the financial statements for 2023. These matters were addressed in the context of our audit of the
financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
Penneo Dokumentnøkkel: N565J-K5BE3-57ZIU-65SQ3-QS0GU-HDFEE
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Independent auditor's report - Vistin Pharma ASA 2023
A member firm of Ernst & Young Global Limited
opinion on these matters. For each matter below, our description of how our audit addressed the matter is
provided in that context.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial
statements section of our report, including in relation to these matters. Accordingly, our audit included the
performance of procedures designed to respond to our assessment of the risks of material misstatement
of the financial statements. The results of our audit procedures, including the procedures performed to
address the matters below, provide the basis for our audit opinion on the financial statements.
Recognition and measurement of inventories
Basis for the key audit matter
As at 31 December 2023 inventories amounted
to NOK 80 171 million, 19.9% of total assets.
These inventories consist of raw materials, work
in progress and finished goods. Inventories are
stated at the lower of cost and net realizable
value. The cost of finished goods comprises
materials, direct labor, other direct costs and
allocation of related production overheads. The
allocation of direct and indirect costs and the
assessment of the net realizable value are
significantly impacted by management's
assumptions. Due to management's estimates
and its significance, recognition and
measurement of inventories is a key audit matter.
Our audit response
We assessed the cost of inventories including
comparing the costs of raw materials to a sample
of invoices, evaluated the allocation of labor cost
and indirect cost, and recalculated the cost prices
for a sample of units. We assessed the allocation
keys used for the allocation of production
overheads. For evaluation of net realizable value,
we performed margin analysis subsequent of
year-end, analyzed the inventory turnover and
compared that to management's estimates on
obsolete inventories and tested the accuracy of
management's prior year assumptions. We refer
to note 15 in the consolidated financial
statements related to inventories.
Other information
Other information consists of the information included in the annual report other than the financial
statements and our auditor’s report thereon. Management (the board of directors and the general
manager) is responsible for the other information. Our opinion on the financial statements does not cover
the other information, and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information,
and, in doing so, consider whether the board of directors’ report, the statement on corporate governance
and the statement on corporate social responsibility contain the information required by applicable legal
requirements and whether the other information is materially inconsistent with the financial statements or
our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the
work we have performed, we conclude that the other information is materially inconsistent with the
financial statements, there is a material misstatement in this other information or that the information
required by applicable legal requirements is not included in the board of directors’ report, the statement
on corporate governance or the statement on corporate social responsibility, we are required to report
that fact.
We have nothing to report in this regard, and in our opinion, the board of directors’ report, the statement
on corporate governance and the statement on corporate social responsibility are consistent with the
financial statements and contain the information required by applicable legal requirements.
Responsibilities of management for the financial statements
Management is responsible for the preparation of the financial statements of the Company that give a
true and fair view in accordance with simplified application of international accounting standards
according to section 3-9 of the Norwegian Accounting Act, and for the preparation of the consolidated
Penneo Dokumentnøkkel: N565J-K5BE3-57ZIU-65SQ3-QS0GU-HDFEE
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Independent auditor's report - Vistin Pharma ASA 2023
A member firm of Ernst & Young Global Limited
financial statements of the Group that give a true and fair view in accordance with IFRS Accounting
Standards as adopted by the EU. Management is responsible for such internal control as management
determines is necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s and the
Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless management either intends to liquidate the
Company or the Group, or to cease operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with ISAs will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional
scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company’s and the Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
• Conclude on the appropriateness of management’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Company’s and the Group’s ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are required to
draw attention in our auditor’s report to the related disclosures in the financial statements or, if
such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Company and the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the consolidated financial
statements. We are responsible for the direction, supervision and performance of the group audit.
We remain solely responsible for our audit opinion.
We communicate with the board of directors regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
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Independent auditor's report - Vistin Pharma ASA 2023
A member firm of Ernst & Young Global Limited
We also provide the audit committee with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters
that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the board of directors, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the key
audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
Report on other legal and regulatory requirement
Report on compliance with regulation on European Single Electronic Format (ESEF)
Opinion
As part of the audit of the financial statements of Vistin Pharma ASA we have performed an assurance
engagement to obtain reasonable assurance about whether the financial statements included in the
annual report, with the file name Vistinpharmaasa-2023-12-31-en, have been prepared, in all material
respects, in compliance with the requirements of the Commission Delegated Regulation (EU) 2019/815
on the European Single Electronic Format (ESEF Regulation) and regulation pursuant to Section 5-5 of
the Norwegian Securities Trading Act, which includes requirements related to the preparation of the
annual report in XHTML format and iXBRL tagging of the consolidated financial statements.
In our opinion, the financial statements, included in the annual report, have been prepared, in all material
respects, in compliance with the ESEF Regulation.
Management’s responsibilities
Management is responsible for the preparation of the annual report in compliance with the ESEF
Regulation. This responsibility comprises an adequate process and such internal control as management
determines is necessary.
Auditor’s responsibilities
Our responsibility, based on audit evidence obtained, is to express an opinion on whether, in all material
respects, the financial statements included in the annual report have been prepared in accordance with
the ESEF Regulation. We conduct our work in accordance with the International Standard for Assurance
Engagements (ISAE) 3000 – “Assurance engagements other than audits or reviews of historical financial
information”. The standard requires us to plan and perform procedures to obtain reasonable assurance
about whether the financial statements included in the annual report have been prepared in accordance
with the ESEF Regulation.
As part of our work, we perform procedures to obtain an understanding of the company’s processes for
preparing the financial statements in accordance with the ESEF Regulation. We test whether the financial
statements are presented in XHTML-format. We evaluate the completeness and accuracy of the iXBRL
tagging of the consolidated financial statements and assess management’s use of judgement. Our
procedures include reconciliation of the iXBRL tagged data with the audited financial statements in
human-readable format. We believe that the evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Penneo Dokumentnøkkel: N565J-K5BE3-57ZIU-65SQ3-QS0GU-HDFEE
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Independent auditor's report - Vistin Pharma ASA 2023
A member firm of Ernst & Young Global Limited
Oslo, 24 April 2024
ERNST & YOUNG AS
The auditor's report is signed electronically
Erik Søreng
State Authorised Public Accountant (Norway)
Penneo Dokumentnøkkel: N565J-K5BE3-57ZIU-65SQ3-QS0GU-HDFEE
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2024-04-24 18:17:37 UTC
Penneo document key: N565J-K5BE3-57ZIU-65SQ3-QS0GU-HDFEE
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