Financial review

Financial review for the period 
1 January – 31 December 2013

(Comparative figures for the same period last year are shown in brackets)

Income statement

The net result for the year 2013 was a loss of DKK -183.7 million (36.4) in line with expectations. The major reason for the decreased result compared to 2012 was that no milestones payments were received in 2013. 


Revenue amounted to DKK 6.6 million (223.6), consisting of royalty payments based on sales of Lyxumia® under the agreement with Sanofi. During 2013 no milestone payments were received. Milestone payments 2012 were related to the license agreements with the company’s partners Sanofi, Boehringer Ingelheim, Helsinn Healthcare and former partner Action Pharma.

Royalty expenses

Royalty expenses for the year were DKK 0.9 million (15.9) and relates to royalty paid to third parties on recieved Lyxumia® sales royalties from Sanofi. 

Research and development expenses

Research and development expenses amounted to DKK 164.5 million (182.8). The decrease relates to an increase in salaries and headcount with DKK 6.0 million, a decrease in incentive programs of DKK -1.8 million and decrease by DKK -24.6 million in other R&D costs mainly due to lower costs related to ZP2929 and the collaboration agreement with Boehringer Ingelheim . These costs have been refunded with DKK 6.6 million (34.2) and recorded as other operating income, see below.

Administrative expenses

Administrative expenses amounted to DKK 34.2 million (27.6). This is mainly a result of increased salaries and headcount of DKK 5.8 million and an increase of DKK 2.8 million in consultancy costs. 

Other operating income

Other operating income amounted to DKK 7.3 million (35.1) mainly associated with income under the license and collaboration agreement with Boehringer Ingelheim, relating to funding of incurred development costs of ZP2929 and costs related to the research collaboration.

Operating result

Operating result for the period was a loss of DKK -185.6million (32.4). 

Net financial items

Net financial items amounted to DKK 1.9 million (4.0). Net financial items consist of interest income, banking fees and changes in exchange rates.

Result from ordinary activities before tax

Result from ordinary activities before tax came to a loss of DKK -183.7 million (36.4).


Tax on ordinary activities

With a negative result from ordinary activities, no tax has been recorded for the period. No deferred tax asset has been recognized in the statement of financial position due to uncertainty as to when tax losses can be utilized.

Net result and  comprehensive income

Net result and comprehensive income both amounted to DKK -183.7 million (36.4) in each case due to the factors described above.


Allocation of result

No dividend has been proposed and the year’s net loss of DKK -183.7 million (36.4) has been transferred to retained earnings.


Equity amounts to DKK 316.1 million (491.0) at the end of the year, corresponding to an equity ratio of 91 % (94). The decrease in equity is a result of the net loss for the year. 

Capital expenditure

Investments in plant and equipment for the period amounted to DKK 4.6 million (8.8) mainly related to new laboratory equipment.

Cash flow

Cash flow from operating activities amounted to DKK -169.6 million (68.5), and cash flow from investing activities to DKK 96.8 million (13.4) of which DKK 148.8 million (119.8) relates to disposal of securities. Cash flow from financing activities amounted to DKK 0.0 million (0.0). The total cash flow for the full year of 2013 amounted to DKK -72.8 million (82.0).

Cash and cash equivalents

As of 31 December 2013, cash and cash equivalents including securities amounted to DKK 310.6 million (485.9). 

Events after the balance sheet date

In January 2014 Sanofi confirmed plans to start Phase III development of LixiLan in the 1st quarter of 2014. DKK 82 (EUR 11) million milestone payment to Zealand was triggered relating to the approval of the first Phase III study protocol for LixiLan by a Health Authority.

Financial outlook for 2014

In 2014, Zealand will have revenue from milestone payments and royalties on Lyxumia® sales. Guidance on milestone payments amount to DKK 97 (EUR 13) million, including DKK 82 (EUR 11) million received from Sanofi in January 2014 and a time based milestone payment from Helsinn of DKK 15 (EUR 2) million to be received in Q4 2014. The timing of other potential milestone based payments is largely outside Zealand’s control and therefore not included in our guidance at this point. 

Guidance on royalties cannot be provided, since Sanofi has given no guidance on expected Lyxumia® sales in 2014. 

Net operating expenses for 2014 are expected at a range of DKK 200-210 (EUR 27-28) million.