IBA Annual Report 2008

IBA

An

nu

Al

re

po

rt

20

08

e

IBAContactPaul-Emmanuel GoethalsDirector, Corporate Business Development & Investor RelationsTel. : +32 10 47 58 16E-mail : [email protected]

Version française disponible sur demande.

Ion Beam Applications, S.A.Chemin du Cyclotron, 3 1348 Louvain-la-Neuve, BelgiumTel. : +32 10 47 58 11 – Fax : +32 10 47 58 10RPM Nivelles – VAT BE 428.750.985E-mail : [email protected] Website : www.iba-worldwide.com

Published by IBA S.A., Chemin du Cyclotron, 3 1348 Louvain-la-Neuve, Belgium.

www.iba-worldwide.com

Design & Production : www.thecrewcommunication.com

This report is printed on ECF wood-free coated paper.

It was produced in plants that comply with ISO 14001,

the environmental management standard.

Moving ahead confidently Annual report 2008

Introduction

Founded in 1986 in Louvain-la-Neuve, Belgium, IBA is primarily active in the medical industry. It develops state-of-the-art equipment and radiopharmaceuticals for cancer diagnosis and treatment. In addition, it uses the scientific expertise thus gained to provide electron beam accelerators for industrial sterilization and ionization. Listed on the pan-European stock exchange Euronext, IBA is included in the Bel Mid Index (IBA: Reuters IBAB.BR and Bloomberg IBAB.BB).

Key facts and figures for 2008Sales growth of 55.5 percent to EUR 332.6 million and recurring earnings of EUR 10.8 million across the Group’s four business areas:• PharmaceuticalsIntegration of CISBIO and extension of the global FDG production and distribution network.• Proton therapyFinancing closed for a proton therapy center in Chicago. Proton therapy center selected by ProCure.• DosimetryCommercial launch of Compass®, a state-of-the-art solution for quality assurance in radiotherapy. First 12 orders received.• AcceleratorsVery good year for PET and SPECT cyclotrons. Nine Rhodotron® and Dynamitron® electron accelerators sold for industrial applications.

Key figuresHighlights of 2008Message from the Chairman and the CEO– Objective met and moving

ahead confidently!Human resourcesResearch and developmentGeographic presenceManagement reportIFRS consolidated financial statements for the year ended December 31, 2008– Consolidated balance sheet– Consolidated income statement– Consolidated statement of

recognized income and expense– Consolidated statement of changes

in the shareholders’ equity– Consolidated cash flow statement– Notes to the consolidated

financial statements– Auditor’s report on the consolidated

financial statementsIBA S.A. annual financial statements after appropriationCorporate governance, management, and controlGeneral informationThe stock market and the shareholders

245

810121427

282930

31

3233

86

91

95

105110

Table of Contents

IBA ANNUAL REPORT 2008 | 1

2008 2007 2006 2005 CAGR (EUR ‘000) (EUR ‘000) (EUR ‘000) (EUR ‘000) (%)

Sales and services 332 607 213 849 170 257 136 099 34.7%

Gross margin 112 335 69 845 53 345 43 855 36.8%

REBITDA (1) 31 798 18 269 17 963 11 118 41.9%

REBIT (2) 10 751 11 788 9 769 3 095 51.4%

REBIT/Sales and services 3.2% 5.5% 5.7% 2.3%

Net profit 5 329 13 846 29 989 3 048 20.5%

Investment spending 33 701 23 772 13 585 6 788 70.6%

Research and development expenses 27 001 17 167 10 028 9 689 40.7%

Equity 152 366 141 481 136 329 103 877 13.6%

Net cash position 17 806 32 028 43 996 18 297 -0.9%

Current liabilities 200 914 118 658 78 767 58 623 50.8%

Total assets 509 521 324 438 266 868 202 755 36.0%

Return on equity 3.5% 9.8% 22.0% 2.9%

Return on capital employed (ROCE) 3.5% 5.7% 5.2% 2.1%

Share price at December 31 (euro) 7.75 19.00 18.36 7.65 0.4%

Number of shares 26 563 097 25 800 252 25 465 066 24 842 453 2.3%

Net earnings per share (euro per share) 0.20 0.54 1.18 0.12 17.8%

Price/Earnings 38.63 35.40 15.59 62.35

Market capitalization 205 864 490 205 467 539 190 045 2.7%

Book value per share (euro per share) 5.74 5.48 5.35 4.18 11.1%

Dividend per share 0.08 0.17 0.00 0.00

Enterprise value 188 058 458 177 423 543 171 748 3.1%

EV/REBITDA 5.9 25.1 23.6 15.4

EmPloyEEs At DECEmBER 31 2 067 1 360 1 076 900 31.9%

2008 2007 2006 2005 CAGR (EUR ‘000) (EUR ‘000) (EUR ‘000) (EUR ‘000) (%)

sales

Pharmaceuticals 149 971 78 265 66 087 45 713 48.6%

Proton therapy 86 191 59 343 32 539 27 190 46.9%

Dosimetry 37 557 35 240 31 570 28 031 10.2%

Other accelerators 58 888 41 001 40 061 35 165 18.8%

Recurring operational profit/(loss)

Pharmaceuticals 2 918 3 205 247 -4 545

Equipments 7 833 8 583 9 522 7 640 0.8%

Key figures

sales trends by business unit

(1) REBITDA: Recurring earnings before interest, taxes, depreciation, and amortization.(2) REBIT: Recurring earnings before interest and taxes.

2 | IBA ANNUAL REPORT 2008

sales trends by geographic sector

sales trends R&D 2008

Change in number of employees and employee distribution worldwide

0

300

600

900

1200

1500

1800

2100

0

60000

120000

180000

240000

300000

R.O.W.45%

R.O.W.60%

R.O.W.45%

2 100

300 000

EUR ‘000

■ Other accelerators■ Dosimetry■ Proton therapy■ Pharmaceuticals

1 800

240 000

1 500

1 200

180 000

900

120 000

600

300

60 000

0

2005

2005

2006

2006

2007 2008

2007 2008

R.O.W.51%

Germany7%

Rest of Europe7%

Asia 7%

USA40%

USA55%

USA55%

USA49%

USA28%

Belgium22%

France29%

2007 2006 20052008

Change in number of employees Employee distribution worldwide

Pharmaceuticals25%

Equipments75%


Highlights of 2008January 7, 2008 IBA announces the sale of several Rhodotron® to be used in the medical device

sterilization market. January 14, 2008 IBA invests in Petrobeam, Inc., a technology development

company in the oil extraction business. February 7, 2008 Archade-IBA partnership formed to

develop hadron therapy. March 13, 2008 IBA opens a new radiopharmaceutical production center

in Guildford, UK. April 1, 2008 IBA and LEONI to build the world’s first X-ray sterilization facility.

May 29, 2008 IBA buys out IRE’s interest in CIS bio International, finalizing its acquisition of the

company. June 6, 2008 Wilex and IBA enter into a worldwide marketing, distribution, and sales

agreement on Redectane® (CA9-SCAN). June 16, 2008 IBA and TAEK close financing of a cyclotron

facility in Turkey. July 30, 2008 IBA signs an agreement with Lantheus Medical Imaging for distribution

of two radiopharmaceuticals in Europe. August 13, 2008 IBA and Aposense sign a collaboration

agreement under which IBA will radiolabel and distribute Aposense® [18F]-ML-10, a novel agent for

molecular imaging of apoptosis, for multicenter clinical trials. September 22, 2008 IBA to supply the

proton therapy system for the Proton Therapy Center of Central DuPage Hospital, Chicago. September

24, 2008 ProCure selects IBA for its third U.S. proton therapy center. September 25, 2008 IBA and

Hae Dong join forces to develop the PET radiopharmaceutical market in South Korea. November 4,

2008 IBA ships its Cyclone® 30 to the Variable Energy Cyclotron Center and sees future potential for

its accelerators in India in the fields of diagnosis and therapy in India. December 1, 2008 IBA

expands its network through an agreement with Biotech Cyclotron of Texas. December 2, 2008

IBA opens a new radiopharmaceutical production facility in Dallas, Texas. December 18, 2008 IBA

receives FDA clearance on the first commercial cyclotron-based integrated proton therapy system with

Pencil Beam Scanning.


What was the most significant event of 2008?Unquestionably, it was our finalization of the takeover of CISBIO and its seamless integration into the Group. In 2008, our business volume grew by some 55 percent. Of course, we owe the strength of this surge to our acquisition of CISBIO, which accounts for 32 percent of our growth. Nevertheless, organic growth accounted for 23 percent. This is the biggest revenue level the Group has ever achieved.

In 2002, not all observers were optimistic about IBA’s future.True, we had some iffy moments back then. But the strategic choices made in 2003 paid off and have put us in a position to confront the current crisis without undue concern. Our Group is bigger now than before we restructured, and we have significantly increased our profitability in a long term prospects.

Objective met and moving ahead confidently!

In 2008, the main event of the year was unquestionably the acquisition of CISBIO, a French company specializing in a number of biomedical technologies, mostly in the radiopharmaceutical industry. This investment is in line with the Group’s new strategy of renewing its focus on cancer diagnosis and treatment. Looking at the 2008 achievements, the Company can be proud of the shift in direction it accomplished five years ago. Despite the current crisis, the Company’s future remains promising.

Peter Vermeeren Chairman of the Board of directors (right) Pierre Mottet Chief Executive Officer (left)

Messages from the Chairman and the CEO


Aren’t you concerned about the crisis?No one is really safe. But healthcare affects us all intrinsically. Day-by-day progress in the fight against cancer is vital for humankind. Investments should be maintained. At worst, decisions may take a bit longer in the context of the current crisis. In proton therapy, for instance, predictions for 2009 remain positive, and the level of investment is substantial—around EUR 50 million per system. Furthermore, some 70 percent of our revenues are from recurring earnings in our other areas, such as pharmaceuticals. The picture is the same for electron accelerators, which had a very good year. We sold nine systems, including our first X-ray sterilization system, which will replace the cobalt systems and make these operations more environmentally friendly.

Acquisition of CIsBIo refocuses the business on Europe. Is IBA returning to its old World roots?We have always had a strong presence in Europe, where we got our start, after all. It is true that acquiring CISBIO shifts our center of gravity towards Europe—which has the definite advantage of reducing our exposure to the dollar. That said, we are continuing to consolidate our geographic expansion. China is now well established as our headquarters for Asia. The market for dosimetry and industrial applications there shows good growth. In addition, two new proton therapy sites are scheduled to open in the United States. In Korea and Turkey, we have signed agreements that will allow us to distribute our radiopharmaceutical products without having to build expensive new production facilities.

last year, you placed particular emphasis on the importance of research and development, for which much larger amounts were budgeted. Have these investments paid off?In proton therapy, our R&D program was already well established, and it produces its share of innovations regularly. We have just completed development of a new pencil-beam scanning treatment method. This leading-edge technology makes it possible to shape the radiation dose to tumor cells with unequalled precision. The

first patients have already been treated. In radiopharmaceuticals, two new products are currently in clinical trial, and the first should be available in 2010 or 2011. This product is designed to help doctors diagnose renal cancers. I should also point to another innovation, Compass®, which makes radiation therapy safer by providing on-line analysis of patient dose delivery. Compass® went on the market in 2008 with excellent initial results. Our R&D investments are still considerable—some 8 percent of our revenues.

Was the 2008 objective met?Yes, we were targeting operating profits for 2008 as good or better than for 2007 at constant dollars. We achieved this objective, despite a substantial, instantaneous increase in overhead due to the acquisition of CISBIO. We are currently implementing an optimization program to reduce these costs. We are still in a transition period that should end in 2010. And our before-tax profits are up by more than 70 percent.

What is the outlook for IBA in the next few years?We are cautiously optimistic. For 2009, we are projecting growth despite the difficult environment, which makes predictions more complex. We remain confident in our potential to achieve an overall profit level at least equal to 2008’s. And, in the medium term, we are confident that we can achieve an operating profit objective of 10 percent, although admittedly our attainment of this objective may be slightly postponed in the current economic climate. So our outlook remains optimistic, which is why we will be paying shareholder dividends for the second year in a row.


these financial results must be a strong motivating force within the Group.Clearly, anybody would rather work for a strong company with a promising future. But in our case, we draw our motivation first and foremost from our contribution to medical progress. Nothing is more inspiring for our researchers, our engineers, and our employees as a whole than knowing that their work has a direct impact on people’s health. We are fortunate to be able to say that our business has a very concrete mission whose usefulness no one can question. It is this motivation and all of the people who are driven by it that make IBA what it is.

Messages from the Chairman and the CEO


IBA: a company of women and men with a mission to serve

more than 230 new recruits in 2008In 2008, IBA experienced a 52 percent growth in personnel. The number of fulltime equivalents (FTEs) rose from 1 360 to 2 067. While this growth is due in large measure to the absorption of CISBIO in June 2008, it also includes 232 new hires, or more than one new hire per working day. This represents a total of more than 700 new employees who have joined IBA in its fight against cancer.

HR: Building human capital from a solid foundationIBA has set ambitious objectives for financial growth and technological development. For the company to achieve them, human resources management must do more than manage personnel; it must develop human capital. Human resources must have both a long and a short-term vision that is grounded equally in company and employee concerns. The four pillars of IBA’s human resources strategy are:

Team buildingOperational excellenceRecruiting high-level talentFostering IBA culture

1. team building In 2008, IBA’s human resources team reorganized to be able to deal with growth from a solid foundation. Three HR subgroups were created:Corporate. This group handles projects affecting the entire IBA organization.Shared Services. Organized by geographic region, this group is responsible for the bulk of human resource operations and transactions.HR Business Partners. An HR business partner is assigned to each business unit and is charged with

translating the unit’s strategy into a long-term HR plan and developing the annual plans implemented by Shared Services. Each HR business partner is a full-fledged member of the business unit’s management team.

At the close of 2008, the HR team had 30 fulltime equivalents for a total of 2 067 employees, or a ratio of one HR member to every 69 employees. The IBA Group has purposely structured the human resources organization so that it will be able to accommodate expected future growth in medicine, particularly in the fight against cancer.

2. operational excellence Efforts in 2008 also focused on developing procedures and tools that can apply to all parts of the company, no matter where they are located. Specifically, these include:

Writing and implementing a general policy on foreign reassignments (more than 15 new foreign reassignments) to facilitate major projects to install proton therapy centers across the globe—in the United States (Oklahoma City, Philadelphia, Hampton, Chicago), Germany (Essen), and France (Orsay)—and to guarantee the availability of IBA’s expert support to its customers and subsidiaries.Deploying software or web-based tools in the following areas: personal performance analysis, cascading objective-setting, management of personal development requirements, and e-recruiting.

All of these tools lay a solid foundation for a major project scheduled for completion in 2009: implementation of a Human Resources Information System (HRIS). The goal of this system is to automate and accelerate certain low valued-

Human resources


added tasks, enhance data reliability, and allow our HR staff to provide better value to their internal customers.

3. Recruiting high-level talent IBA owes its leadership in its fields of operation to its employees’ ability to create constant innovation in the technologies of the future. IBA implements a number of strategies to attract and retain the best talent, including:

Using salary benchmarks to ensure pay market competitivenessDifferentiating recruitment channels (e-recruitment, specialized symposia, radio, on-campus recruitment of identified targets and in emerging markets)Establishing two career paths: a management path and a technical path, both of which provide opportunities for advancement within the Group.

With an average employee turnover of 8.4 percent across the Group (at constant scope) and the hiring of 232 new employees, including many very high-level technical specialists and scientists, IBA’s recruitment teams can be said to have achieved their mission.

4. Fostering IBA culture With about 130 percent growth in three years, IBA needs to strengthen one of its competitive advantages in the job market: its company culture and values. IBA is recognized by its customers for its capacity to innovate and support technical development to meet their requirements. Its employees are perceived as enthusiastic and service-oriented experts. IBA’s employees appreciate its human scale, its family atmosphere, its cosmopolitan environment, and its many career opportunities.

Here are some of the ‘culture’ achievements for 2008:Deployment of a new IBA image that strengthens the feeling of belonging to a single groupRedefinition of our new-employee orientation programsA special program for recently absorbed CISBIO employees to inform them of and instill in them the

values of the IBA GroupOrganization of interactive workshops for the entire Group management to collaborate in devising action plans to integrate IBA culture into workaday lifeImplementation of programs providing rigorous training in certain key skills areas and assuring our customers of the quality of IBA services and products

In 2008, IBA will increase its use of personnel development tools. It will also implement a talent management strategy and employee retention and replacement plans. IBA is convinced of the importance of its human capital and devotes nearly 2 percent of its revenues to implementing its human resources policy, so that the men and women in it can work together to ensure the future success of the Company.


One of IBA’s basic principles is to market products and services that are clearly state of the art. This is particularly true in the field of cancer diagnosis and treatment.

R&D-based technological innovation is an essential component of IBA’s products. From the beginning, IBA has devoted a significant portion of its resources to improving its products and developing novel, innovative solutions. In 2008, it invested EUR 27 million, or slightly more than 8 percent of revenues, in research and development.

Distribution of R&D spending between IBA’s two main business areas in 2008

Absorption of CISBIO in 2008 brought a significant increase in R&D staff levels, from 192 employees at end-2007 to 265 at end-2008.

But alongside its internal development efforts, IBA’s research policy increasingly looks to promote collaboration with external research partners. These research partners are either universities and other research institutions or companies with expertise useful for the development of IBA products and services.

This partnership approach is especially evident in the area of radiopharmaceuticals. Today IBA boasts the world’s largest network of radiopharmacies specializing in the production of diagnostic molecules labeled with positron-emitting radioisotopes. IBA also possesses unique know-how in the production of radioisotopes, as well as in the labeling of radiophamaceuticals under GMP conditions. These factors make IBA the partner of choice for pharmaceutical or biotech companies that have developed new biotracers. The principal research milestones for 2008 are described below by business area.

RadiopharmaceuticalsIn the area of radiopharmaceuticals, there were three major developments:Short-term enrichment of the SPECT product portfolio with European approval for STAMICIS® (99mTc-sestamibi radiolabeling kit for myocardial infusions)Application for European approval of the SCINTIMUN® product (99mTc-radiolabeling kit for the diagnosis of infection/inflammation)Expansion of the PET product portfolio: application submitted for DOPACIS® (18F-fluorodopa for the diagnosis of Parkinson’s disease and neuroendocrine tumors) and development begun on 18F-choline products for the diagnosis of prostate cancers and 18F-Na for the diagnosis of bone metastases.With respect to innovation, two agreements were signed with biotech companies:An agreement with Wilex AG for distribution rights to Redectane®, a positron-emitter-based diagnostic imaging agent in phase III trial that is designed to help doctors diagnose clear cell renal cancers prior to surgeryAn agreement with Aposense (formerly NST Ltd.) for the labeling and distribution of Aposense®

Research and development

Pharmaceuticals25%

Equipments75%


[18F]-ML-10, its novel agent for the molecular imaging of apoptosis

BioassaysThe year 2008 was especially rewarding for our R&D in the fields of in vitro diagnostics (IVD) and drug discovery. Many projects reached completion, which means new products and technologies went to market. They include:The Transcreener® ADP assay, a product resulting from the agreements with Bellbrook Labs and designed for use in the screening of kinase activity (launched in early 2008)New kits developed for G protein-coupled receptor (GPCR) screening using the new terbium cryptates resulting from our agreement with California’s Lumiphore (launched in mid-2008)The new Chromoa chromogranin A ELISA kit, which complements the existing CGA-RIACT product and can be used by any laboratory to detect and monitor neuroendocrine cancers

Proton therapyThe principal research milestone for the year in our proton therapy business was the obtention of approval from the U.S. Food and Drug Administration (FDA) for the new pencil-beam scanning (PBS) treatment method. Pencil-beam scanning was developed by IBA in close collaboration with the team of the Francis H. Burr Proton Therapy Center at Massachusetts General Hospital (MGH), Boston, where the first patient was treated using this modality in December 2008. With pencil-beam scanning, the radiation dose to tumor cells can be shaped with unequalled precision. This is a world first for a cyclotron-based therapy system.

Cyclotrons and electron beam acceleratorsIn the area of particle accelerators (PET and SPECT cyclotrons), 2008 saw delivery of the new C70 cyclotron for the Arronax project in Nantes, France. This new cyclotron, designed for research and production of new radioisotopes for medical applications, has unique capabilities that place it at the leading edge of accelerator technology. It can accelerate proton beams to an energy of up to 70 MeV, or a beam power of 50 kW. In addition, it

can accelerate alpha particles, which are needed to produce new therapeutic radioisotopes like Astatin 211.

With respect to industrial applications of particle accelerators (Rhodotron® and Dynamitron®), a Rhodotron® prototype has been shipped to be incorporated in a system for the remote detection of explosives in sea cargo containers in 2008. This project is subsidized by the U.S. Department of Homeland Security.

DosimetryThere were a number of developments in dosimetry in 2008. They include shipment of new versions of OmniPro software and of the Compass® and a number of product launches: the MLIC, a new dosimetry device for proton therapy, and innovative solutions for dosimetry of rotational radiotherapy (Thomotherapy™, RapidArc™, and VMAT®) using the MATRIXX Evolution system. In radiodiagnostic dosimetry, the PC-based, USB-powered MagicMax system is an automatic, precision instrument for simultaneously measuring dose, dose rate, dose per pulse, exposure time, noninvasively practical peak voltage, and total filtration.


FDG production sites (52) Albany USA Haverhill USA Cleveland USA Gilroy USA Morgantown USA Orlando USA Richmond USA Romeoville USA Somerset USA Sterling USA Kansas City USA Los Angeles USA Dallas USA Montreal Canada Brussels Belgium Ghent Belgium Fleurus Belgium Lyon France Paris France Sarcelles France Orsay France Rennes France Nîmes France Nancy France Bordeaux France Milan Italy Rome Italy Udine Italy Dinnington UK Guildford UK Bad Oeynhausen Germany Madrid Spain Barcelona Spain Seville Spain Malaga Spain Delhi India Kuala Lumpur Malaysia

Monrol sites Istanbul-1 Turkey Istanbul-2 Turkey Ankara Turkey Adana Turkey Izmir Turkey HaeDong sites Seoul - 1 South KoreaSeoul - 2 South Korea Pyeongchon South Korea Daejun South Korea Pusan South Korea Suncheon South Korea Daegu South Korea BioTech sites Albuquerque USA Las Vegas USA Lubbock USA

Geographical presence


Headquarters IBA Group Louvain-la-Neuve Belgium

other offices (7) IBA Particle Therapy Louvain-la-Neuve Belgium IBA Industrial Louvain-la-Neuve Belgium IBA Molecular Dulles USA IBA China Beijing China IBA Dosimetry Schwarzenbruck Germany IBA Molecular Saclay France CISBIO Bioassays Marcoule France

main sales or other offices (4) IBA Particle Therapy Jacksonville USA IBA Industrial Edgewood USA IBA Dosimetry Bartlett USA IBA Dosimetry Uppsala Sweden


Management report

Highlights of 2008

The major event of the 2008 was beyond question the June 1st acquisition of CISBIO, a French medical diagnosis company with more than 600 employees and revenues of EUR 100 million plus, in which IBA already held a 19.9 percent interest.

In 2008, revenue growth was spread across IBA’s four business areas:Growth of more than 90 percent in pharmaceuticals, partially as a result of the absorption of CISBIORevenue growth of 45 percent in proton therapy,

due primarily to progress on projects for contracts signed in 2006 and 2007Eighteen PET and SPECT cyclotrons and nine electron accelerators sold—an increase of 44 percentGrowth of slightly under 7 percent in dosimetry, generated to a large extent by its success in Asia and the U.S. and by the introduction of its new Compass® dosimetry solution

overview of IBA business segments

For financial reporting purposes, IBA is divided into two business segments:

The Pharmaceuticals segment encompasses radiopharmaceutical agents (production and distribution) and bioassay operations.Radiopharmaceuticals• PET1: primarily fluorodeoxyglucose (FDG), a

chemical compound used in molecular imaging for the diagnosis of many diseases (principally cancer).

• SPECT2: used in nuclear medicine for therapy and imaging.

Bioassays• A line of biomarkers used for in vitro medical

diagnoses (e.g. radioimmunoassays).• The Group’s new HTRF®3 technology also gives it

a presence in the in vitro screening of new drugs for the pharmaceutical industry and biotech companies.

• More than half of these products are used in the diagnosis and treatment of cancer.

The Equipments segment, which encompasses the following:Proton therapyParticle accelerators (cyclotrons, Rhodotron®, and Dynamitron®)DosimetryCustomer service operations

Approved by the Board of Directors at its meeting of April 2nd, 2009

(1) Positron emission tomography(2) Single photon emission computed tomography(3) Homogeneous Time-Resolved Fluorescence


Dosimetry11% Dosimetry

16%

Accelerators18%

Accelerators19%Pharmaceuticals

45%Pharmaceuticals

37%

Proton therapy26%

Proton therapy28%

total sales and services for 2008: EUR 332.6 million

total sales and services for 2007: EUR 213.8 million

IBA’s two business segments – Pharmaceuticals and Equipments – are made up of four business areas, whose revenues and key events for 2008 are described in this management report.

PharmaceuticalsProton therapyCyclotrons et other acceleratorsDosimetry

Pharmaceuticals

As a result of the late May 2008 acquisition of CISBIO, which has been consolidated with the Group’s accounts since June 1, 2008, the main components of this business area are as follows:Production and distribution of PET radiopharmaceutical agents—especially FDG (fluorodeoxyglucose)—used in molecular imaging to diagnose many diseases (principally cancer)

SPECT radiopharmaceuticals, used in nuclear medicine for therapy and imagingBioassay operations

The following table presents the summary income statement for Pharmaceuticals:

BUsInEss sEGmEnt 2008 2007 CHAnGE (EUR ‘000) (EUR ‘000) (%)

Pharmaceuticals 149 971 78 265 91.6%

Equipments 182 636 135 584 34.7%

ConsolIDAtED REvEnUEs 332 607 213 849 55.5%

Above pro forma results presented after allocation of corporate overhead.REBITDA: Recurring earnings before interest, taxes, depreciation, and amortization.REBIT: Recurring earnings before interest and taxes.

2008 2007 CHAnGE CHAnGE (EUR ‘000) (EUR ‘000) (EUR ‘000) (%)

Sales and services 149 971 78 265 71 706 91.6%

REBITDA 20 379 8 650 11 729 135.6%

% of sales 13.6% 11.1%

REBIT 2 918 3 205 -287 -9.0%

% of sales 1.9% 4.1%


PEt and sPECt radiopharmaceuticalsIBA is active in the production and distribution of PET and SPECT radiopharmaceutical agents. In 2008, IBA was mainly active in the production and distribution of FDG (fluorodeoxyglucose, a radioactive sugar), which is used in molecular imaging. This imaging technology is utilized to analyze cell metabolism for the diagnosis and monitoring of diseases (primarily cancer). PET is the most advanced technology in nuclear medicine.

PET radiopharmaceuticals (primarily FDG) are produced in numerous cyclotron-equipped production plants. Owing to the nature of the product—PET radiopharmaceuticals have a short half-life—production location must be within a short radius of where the radiopharmaceuticals will be used, i.e. the hospital or medical imaging facility. In 2008, IBA continued to expand its global FDG production and distribution network. At the close of the year, it had 47 FDG production facilities—17 in North America, 21 in Europe, and 9 in Asia—or 12 more production facilities than at the end of 2007. Of these, IBA has no financial interest in 10, which are part of the global radiopharmaceutical distribution network under various cooperation agreements. The agreement signed in September 2008 with Hae Dong Co. Ltd. for distribution in Korea and the agreement signed in December 2008 with Biotech Cyclotron of Texas for the western United States reflect this strategy of cooperation.

The year 2008 also saw the signature of the first agreements aimed at positioning IBA in the arena of patented radiopharmaceutical tracers. An agreement was signed with Wilex AG to acquire the distribution rights for Redectane®, a product designed to help doctors diagnose clear cell renal cancers prior to surgery. A second agreement was signed with Aposense (formerly NST Ltd.) for the labeling and distribution of Aposense® [18F]-ML-10, its novel agent for the molecular imaging of apoptosis. Subject to the finalization of a distribution agreement to be negotiated in

the context of a right of first refusal, these new radiopharmaceutical agents will be distributed through IBA’s network of PET facilities.

With its acquisition of CISBIO, IBA entered the business of SPECT radiopharmaceutical production, which is done mainly at IBA’s plant in Saclay, near Paris, France. In late summer 2008, the shutdown of three European reactors needed for the production of SPECT radioisotopes caused a market shortage. The impact on IBA was real, but smaller than had been feared. IBA managed to keep patients from being affected by the shortage by distributing the reduced quantity of available product among its customers and replacing technetium, which had become scarce, with alternative products.

BioassaysAs a result of its acquisition of CISBIO, IBA operates a bioassays unit, renamed CISBIO Bioassays. Located in Marcoule, in southern France, CISBIO Bioassays markets a line of biomarkers for in vitro medical diagnosis such as radioimmunoassays, as well as a line of products based on its HTRF®1 technology that are used for the in vitro screening of new drugs for the pharmaceutical industry and biotech companies. More than half of these products are used in the diagnosis and treatment of cancer. Many enjoy significant commercial and R&D synergies with IBA operations.

(1) Homogeneous time-resolved fluorescence


Management report

Equipments

This business segment encompasses proton therapy, particle accelerators (cyclotrons, Rhodotron®, and Dynamitron®), dosimetry, and customer service.

In 2008, IBA was selected to equip a proton therapy center in Michigan. It also logged 18 cyclotron orders, as well as 9 orders for

industrial accelerators. Equipments segment earnings for 2008 totaled EUR 182.6 million, compared with EUR 135.6 million in 2007. This increase of 34.7 percent was due to strong growth in proton therapy and accelerators. The following table provides a breakdown of Equipments sales and service figures by business area, as well as the segment’s overall contribution to income:

2008 2007 CHAnGE CHAnGE (EUR ‘000) (EUR ‘000) (EUR ‘000) (%)

Sales and services 182 636 135 584 47 052 34.7%

- Proton therapy 86 191 59 343 26 848 45.2%

- Dosimetry 37 557 35 240 2 317 6.6%

- Other accelerators 58 888 41 001 17 887 43.6%

REBITDA 11 419 9 619 1 800 18.7%

% of sales 6.3% 7.1%

REBIT 7 833 8 583 -750 -8.7%

% of sales 4.3% 6.3%

Above pro forma results presented after allocation of corporate overhead.REBITDA: Recurring earnings before interest, taxes, depreciation, and amortization.REBIT: Recurring earnings before interest and taxes.

Proton therapyProton therapy is increasingly considered the best radiation therapy for cancer because it provides excellent dose distribution. Protons focus their greatest effective energy on a precisely controlled area at the exact center of the tumor and are gentler on the surrounding healthy tissue. Higher doses of radiation can be delivered to the tumor without increasing the risks of side effects or long-term complications, thereby improving both the outcome and the patient’s quality of life. Unfortunately, at the present time, there are few patients in the world for whom this type of treatment is accessible.

In 2008, despite the difficult financial climate, Procure Treatment Center Inc. obtained funding for the Proton Therapy Center of Central DuPage Hospital in Chicago. This same customer also selected IBA to equip the Proton Therapy Center at William Beaumont Hospital in Royal Oak, Michigan. Revenues continue to show strong growth (up 45.2 percent), fueled by progress on current projects under contracts signed in 2006 and 2007.

IBA has continued to invest in research and development in proton therapy, which translated to a sharp increase R&D spending in 2008. These investments have produced results. For example, in mid-December, IBA obtained approval from the U.S. Food and Drug Administration for its pencil-beam scanning (PBS) treatment method. Pencil-beam scanning was developed by IBA in close collaboration with the team of the Francis H. Burr Proton Therapy Center at Massachusetts General Hospital, Boston, where the first patient was treated using this modality in December 2008. With pencil-beam scanning, the radiation dose to tumor cells can be shaped with unequalled precision. This is a world first for a cyclotron-based therapy system.

IBA is also working on a hadron (carbon-ion) therapy system. A first prototype is in development.

Currently, IBA is building and installing seven proton therapy centers simultaneously, five of which are on-site installations (three in the United States and two in Europe)—a world first. All projects are on


schedule. What is more, six IBA-built proton therapy centers are already treating patients in the United States and Asia daily. The proton therapy facility at the University of Florida Proton Therapy Institute, which celebrated its second year of operation in 2008, now treats around 110 patients a day, which is a major success.

IBA sales and services in proton therapy totaled EUR 86.2 million in 2008, compared with EUR 59.3 million in 2007, an increase of 45.2 percent.

Cyclotrons and electron acceleratorsThis area encompasses cyclotrons used in the production of PET or SPECT radioisotopes and electron beam particle accelerators intended primarily for industrial use, like the Rhodotron® and Dynamitron®. It does not include cyclotrons for proton therapy.

In 2008, IBA sold 18 PET and SPECT cyclotrons, compared with 19 cyclotrons in 2007 and 7 in 2006. IBA also began installation of 2 Cyclone® 30, SPECT cyclotrons previously sold to the Turkish Atomic Energy Authority (TAEK) and India’s Department of Atomic Energy. In late 2008, IBA sold a new version of the Cyclone® 30 to the Institute of Neurosciences and Medicine (specifically, INM-5, Nuclear Chemistry), a department of Germany’s Forschungszentrum Jülich research center. This cyclotron will be capable of accelerating protons (to 30 MeV ), deuterons (to 15 MeV), and alpha particles (to 30 MeV).

In the field of electron beam accelerators (Rhodotron® and Dynamitron® e-beam/X-ray industrial accelerators), 2008 was a record year, with the sale of nine electron accelerators for industrial applications, including the first X-ray sterilization system using the Rhodotron® TT-1000, which was sold to the LEONI Group in Switzerland. Another Rhodotron® was sold to PetroBeam, Inc., a U.S. technology development company in the oil extraction industry in which IBA holds a 10 percent stake, together with warrants allowing it to raise its ownership to around 20 percent at a later stage.

Sales and service revenues for the Company’s

cyclotron and electron accelerator business totaled EUR 58.9 million in 2008, compared with EUR 41.0 million in 2007, or an increase of 43.6 percent.

DosimetryDosimetry encompasses services and equipment to control radiation dosage in medical settings. IBA’s specialized dosimetry products are essential tools for quality assurance in radiation therapy (therapeutic dosimetry) and medical imaging (diagnostic dosimetry).

In diagnostic dosimetry, for the fourth year in a row, IBA Dosimetry was named Siemens Supplier of the Year.

In therapeutic dosimetry, the year was marked by the introduction of the new Compass® dosimetry solution developed in cooperation with RaySearch Laboratories, for which IBA logged 12 orders in 2008.

Dosimetry met with great success in Asia and the United States in 2008 as well. IBA also launched sales of the first dosimetry system for use in proton therapy.

The Company’s 2008 figure for dosimetry sales and services was EUR 37.5 million, compared with EUR 35.2 million in 2007, or an increase of 6.6 percent.


Consolidated annual financial statements

Income statementConsolidated sales and services for 2008 were up 55.5 percent, or EUR 118.8, million in comparison with 2007, from EUR 213.8 million to EUR 332.6 million. This increase was the result of growth in all business areas, but particularly the Pharmaceuticals segment, owing to the inclusion of CIS Bio International S.A.S. in the scope of consolidation.

Consolidated gross margin for 2008 totaled EUR 112.3 million compared with EUR 69.8 million for the previous period, or an increase of 60.8 percent. As a percentage of consolidated sales and services, they stood at 33.8 percent versus 32.7 percent in 2007. This increase was essentially due to the improvement of margin in the Pharmaceuticals segment.

Overall, recurring costs rose 75 percent from 2007 to 2008, with a big increase in sales and marketing expenses (43.9 percent), general and administrative expenses (123.5 percent), and research and development expenses (57.3 percent). This growth reflects the Group’s investment strategy in these areas, particularly in proton therapy, as well as a change in the scope of consolidation due to the absorption of CIS Bio International S.A.S.

The Group showed net recurring earnings of EUR 10.8 million in 2008 versus EUR 11.8 million a year earlier, or a decrease of 8.8 percent. At constant EUR/USD exchange rates, this decrease would have been 1.6 percent.

Other operating profits for 2008 stood at EUR 6.4 million. This figure primarily reflects the impact of the acquisition of CIS Bio International S.A.S.: specifically, a contribution of EUR 14 million from France’s CEA (Commissariat à l’Energie

Atomique, Atomic Energy Commission) to help CIS Bio International S.A.S. meet its obligations in connection with the decommissioning of certain Saclay facilities after 2017. It also includes various amortizations of tangible and intangible assets.

IBA posted a financial loss of EUR 2.6 million in 2008 due to the combined effect of treasury investment products, charges for the discounting of long-term provisions, interest expenses for financial liabilities, and the revaluation of financial instruments. In particular, the Company had invested a small portion of its liquidities in investment instruments that, because of the financial crisis, it was forced to revalue to their assumed market value. At year-end, after recording a financial loss of EUR 2.2 million and reducing the value of these investments to EUR 0.7 million, it reclassified them as long-term assets.

Tax figures for 2008 show a tax expense of EUR 6.8 million, compared with a tax income of EUR 7 million in 2007. Recognition of significant deferred tax assets made 2007 an atypical year. Taking these deferred taxes into account, 2008 tax expense basically represents the normal use of assets previously set aside and has only very minimal impact on the Company’s cash balance.

Entities accounted for by the equity method contributed a loss of EUR 2.4 million in 2008. This charge was due primarily to the results of CIS Bio International S.A.S. for the first 5 months of 2008, which were particularly affected by the provision for restructuring which it recorded in February 2008.

Net profit of EUR 5.3 million in 2008 compared with a net profit of EUR 13.9 million in 2007.

Management report


Consolidated balance sheet and financial structure The Group’s consolidated balance sheet and financial structure have been heavily affected by the inclusion of CIS Bio International S.A.S. in its scope of consolidation.

Non-current assets increased significantly in fiscal 2008, from EUR 151.3 million at December 31, 2007 to EUR 250.4 million at December 31, 2008. The total difference of EUR 99.1 million is attributable primarily to the following changes:EUR 18.9 million increase in fixed assets due primarily to absorption of CIS Bio International S.A.S., investments in the Pharmaceuticals segment (in the United States, Italy, France, England, and Belgium), and investments at the Louvain-La-Neuve facility.EUR 33.1 million increase in intangible assets due primarily to the absorption of CIS Bio International S.A.S. (EUR 29.2 million) but also to investments in patents and licenses for the distribution of radiopharmaceutical agents.EUR 46.5 million increase in other long-term assets due primarily to reserved assets set aside for the future decommissioning and restoration of Group facilities (EUR 29.9 million) and to an increase in down payments collected on proton therapy contracts for which the related receivables do not qualify for derecognition under IAS 39 (EUR 13.6 million).EUR 0.6 million for changes in goodwill, deferred tax assets, companies accounted for by the equity method, and other investment ownership.

Non-current liabilities rose from EUR 64.3 million at December 31, 2007 to EUR 156.2 million at December 31, 2008. The total difference of EUR 91.9 million was due primarily to the following changes:EUR 6.0 million decrease in long-term liabilities due primarily to their reclassification to short-term liabilities.EUR 86.1 million increase in provisions due primarily to the inclusion of CIS Bio International S.A.S. in the scope of consolidation.EUR 11.8 increase in other long-term liabilities due primarily to the recording of down payments on proton therapy contracts for which the related

receivables do not qualify for derecognition under IAS 39.

The Group’s net cash position went from EUR 32 million at December 31, 2007 to EUR 17.8 million at December 31, 2008.

IBA s.A.’s statutory accounts and appropriation of net profit/(loss)Ion Beam Applications S.A. posted sales and services of EUR 183.4 million in 2008, compared with EUR 112.1 million in 2007, or an increase of 63.6 percent. This growth is primarily the result of the continuing recognition of income from sales of proton therapy systems in 2006 and 2007 and the booking of an additional sale in 2008. It is also due to good cyclotron sales performance in nuclear medicine, where 18 machines were sold in 2008.

Operating results show a loss of EUR 1.7 million in 2008 compared with a loss of EUR 0.5 million in 2007. These 2008 operating results were affected by work subcontracted to IBA Radioisotopes S.A. in the context of new molecules development.

Net profit stood at EUR 6.8 million in 2008, compared with a net profit of EUR 4.9 million in 2007. The 2008 figure is explained principally by positive financial results, strongly impacted by dividends from IBA’s Swedish subsidiary.

The Board of Directors will ask the shareholders to declare a dividend of EUR 0.08 per share at the Ordinary General Meeting of May 13, 2009.

Research and developmentIn 2008, research and development expenses for the Group totaled EUR 27 million, compared with EUR 17.2 million in 2007. This appreciable investment has allowed IBA to maintain its world leadership in all of the markets in which it is active.

Acquisitions and divestments in 2008On May 19, 2008, IBA exercised its call option for 80.1 percent of Radiopharma Partners S.A. (which had an 80.1 percent ownership interest in CIS Bio International S.A.S.) and 19.9 percent of Sceti Medical Labo KK.The Group’s acquisition of CIS Bio International


S.A.S. has considerably expanded its product offering, particularly in conventional nuclear medicine and in vitro testing and screening. Many of these products enjoy significant commercial and R&D synergies with Group operations.

Capital increase and granting of subscription rightsIn the course of the year, the Board of Directors exercised its right to increase the capital with waiver of the preemptive rights of existing shareholders in the context of the authorized capital.

In its decision of June 23, 2008, the Board of Directors increased the capital by EUR 764 447, from EUR 36 460 651.13 (thirty-six million four hundred sixty thousand six hundred fifty-one euros and thirteen cents) to EUR 37 225 098.13 (thirty seven million two hundred twenty-five thousand ninety-eight euros and thirteen cents) by creating 544 611 (five hundred forty-four thousand six hundred eleven) new shares with VVPR strips. This stock was offered for subscription to the Institut National des Radioéléments (IRE). This subscription, which strengthens the Group’s stable shareholders, was made in the context of agreements related to the purchase of the 80.1 percent interest in Radiopharma Partners held by IRE.

In its decision of September 25, 2008, the Board of Directors decided to grant a maximum of 350 000 (three hundred fifty thousand) subscription rights, hereinafter “warrants,” and as a condition precedent to the exercise of 200 000 (two hundred thousand) free warrants maximum and as a double condition precedent to the subscription of 150 000 (one hundred fifty thousand) saleable warrants maximum and subsequent exercise of 150 000 (one hundred fifty thousand) saleable warrants maximum, to increase the capital up to a maximum amount of EUR 491 295 (four hundred ninety-one thousand two hundred ninety-five euros), in order to create a maximum of 350 000 (three hundred fifty thousand) new shares in the Company with VVPR strips. In an official document of December 18, 2008, it was recorded that, of the 200 000 (two hundred thousand) free warrants, 77 283

(seventy-seven thousand two hundred eighty-three) had been accepted, and that of the 150 000 (one hundred fifty thousand) saleable warrants offered for subscription, 38 187 (thirty-eight thousand one hundred eighty-seven) saleable warrants had been subscribed for the price of EUR 0.60 (sixty cents) per warrant, as a consequence of which it was recorded that 122 717 (one hundred twenty-two thousand seven hundred seventeen) free warrants offered by the Board of Directors on September 25, 2008 had been cancelled. This warrant grant was made in the context of the launching the Group’s 2008 employee stock option plan. The strike price of one option is EUR 14.18.

Corporate structure and governanceThe following is drawn from the “Corporate Governance, Management, and Control” section of this annual report.

At its meeting of March 4, 2008, the Board of Directors was to rule on the report of the Compensation Committee. This situation gave rise to application of the procedure stipulated in article 523 of the Belgian Code of Company Law for cases of director conflict of interest. This conflict involved the managing directors as the heads of management services companies providing services to IBA. After deliberation, the Board unanimously adopted the recommendations made by the Compensation Committee in its report to the Board regarding both the strategic objectives assigned to these management services companies for 2008 and the determination of variable pay for 2007.

Approval of the launch of a stock option plan by the Board of Directors at its August 27, 2008 meeting also gave rise to application of the procedure stipulated in article 523 of the Belgian Code of Company Law for cases of director conflict of interest. This conflict of interest affected all of the directors except Nicole Destexhe, Peter Vermeeren, and Jean-Jacques Verdickt (J.J. Verdickt SPRL). The conflict of interest was recorded as follows: “The members approved the principle of launching this plan, as well as the terms of the special report to the Board. All of the members of the Board were eligible for inclusion in

Management report


share ownership and stock options

number of shares %

Belgian Anchorage 7 773 132 29.26%

IRE (Institut des Radioéléments) 1 423 271 5.36%

Sopartec 529 925 1.99%

UCL (Université Catholique de LLN) 426 885 1.61%

IBA Investments S.C.R.L. (*) 433 692 1.63%

Public 15 976 192 60.14%

total 26 563 097 100.00%

this plan. However, Nicole Destexhe, the Chairman, and Jean-Jacques Verdickt said that they did not wish to be included in the list of beneficiaries. As beneficiaries of the plan, the other directors stated that they had a direct financial interest and that this gave rise to a conflict-of-interest situation under article 523 of the Code of Company Law. They would not participate further in the discussion. After discussion, Nicole Destexhe, the Chairman, and Jean-Jacques Verdickt unanimously approved the launch of a stock option plan involving 350 000 options and, consequently, approved the terms of the Board’s draft special report prepared in compliance with articles 583, 596, and 598 of the Code of Company Law, subject to any changes required by Belgium’s Banking, Finance, and Insurance Commission (CBFA).”

Lastly, at its meeting of December 16 and 17, 2008, the Board of Directors was to rule on bringing the compensation of the Chairman of the Board and the Chairman of the Audit Committee in line with market levels. This situation gave rise to application of the procedure stipulated in article 523 of the Belgian Code of Company Law for cases of director conflict of interest. The

proposed increase was based on a study by Price Waterhouse Coopers indicating that compensation was not in keeping with market levels. This conflict of interest involved the Chairman of the Board and the Chairman of the Audit Committee. This conflict of interest was reported as follows: “Because discussion of the proposal to increase the compensation of the Chairman of the Board of Directors and the Chairman of the Audit Committee placed these directors in a conflict-of-interest situation under article 523 of the Belgian Code of Company Law, they left the room and did not participate in the discussion. After deliberation, the Board unanimously approved doubling the compensation of the Chairman of the Board and increasing by 50 percent that of the Chairman of the Audit Committee, who would no longer receive stock options.” On returning to the boardroom, the Chairman of the Board of Directors and the Chairman of the Audit Committee asked that implementation of this decision be put on hold until the financial climate improved.

(*) At December 31, 2008, IBA held a total of 433 692 of its own shares through the company IBA Investments SCRL, a wholly owned indirect subsidiary.


In addition to the risks to which all industrial companies are exposed, IBA is subject to significant risks specific to its operations. These risk factors are described in the following list, which does not claim to be exhaustive.

Regulatory approval A number of IBA products and items of equipment are subject to regulatory approval as medical equipment or pharmaceutical products. Such approval must be obtained in every country in which IBA wishes to sell these products or equipment. For example, for its proton therapy equipment, IBA had regulatory approval for the United States (Food and Drug Administration), the European Union (European Commission), China (State Drug Administration), and South Korea as of December 31, 2008. And in dosimetry, between late 2007 and early 2008, IBA obtained approval for its Compass® product in the United States and the European Union. There is always a risk that the authorizing authorities may withdraw these approvals. Furthermore, when technological innovations occur, additional approvals are required. Thus, in 2008 IBA obtained FDA approval for its pencil-beam scanning treatment method (a form of proton therapy). Similarly, radioisotope production and distribution is subject to many regulations with which the Company must comply at all times in order to continue to market its products.

technological risksThe Company continues to invest heavily in research and development. One cannot overlook the probability that one of its prototypes may not be commercially viable or may become obsolete in development because of competing technological developments.

Healthcare reimbursement Reimbursement by health care reimbursing institutions of charges for PET scans or SPECT scans or for the treatment of certain diseases involving direct or indirect use of IBA equipment is subject to review. These institutions’ healthcare reimbursement polices impact the number of orders that IBA may potentially obtain. The reimbursement policies of

such institutions differ from country to country and can vary widely.

Product liability insurance Use of the Company’s products may expose it to certain liability lawsuits. The Company maintains what it believes to be sufficient insurance to protect it in the event of damages arising in a product liability lawsuit or from the use of its products. In a country such as the United States, where the slightest incident may result in major lawsuits, there is always a risk that a patient who is dissatisfied with services delivered using the Company’s products may initiate legal action against it. The Company cannot guarantee that its insurance coverage will always be sufficient to protect it from such risks or that it will always be possible to obtain coverage for such risks.

Foreign exchange risks The Company is exposed to foreign exchange risks when it signs certain contracts in foreign currencies or when it invests abroad. Insofar as possible, the Company employs the financial instruments necessary to limit its exposure to these risks. The Company’s financial risk management objectives and policy, as well as its policies on price risk, liquidity risk, and cash flow risk, are described in greater detail in the notes to its consolidated financial statements.

Asset depreciation risksThe Company acquires ownership in companies in complementary business sectors. In most cases, these are recently established companies in innovative sectors. IBA cannot guarantee that all of these investments will be profitable in the future or that some projects will not be halted, pure and simple. In some cases, IBA also uses its surplus cash position to invest in very liquid, highly rated (AAA) financial instruments. However, it cannot foresee sudden changes in the ratings of these products or market changes that may impair liquidity.

Decommissioning risksCISBIO recently obtained INB (Basic Nuclear Facility) designation in France. As an INB-designated facility, it is required to set aside resources for the restoration

Management report

Principal risks and uncertainties


of the operating site where its activities are located at the expiration of a period ending in either 2022 or 2078, as applicable. The required funds have been reserved, based on outside studies and French legal requirements, but the Company cannot be certain that supplemental provisions will not have to be made or additional funds reserved as a result of factors including but not limited to financial market performance or possible changes in the law or restoration technologies.

Dependency on certain employees Since the Company’s foundation, the number of highly qualified individuals on its payroll has increased tremendously. However, it is possible that the defection of certain key employees possessing specific expertise could at some point affect one of the Company’s business areas.

Dependency on a specific customer or a limited number of orders In general, IBA’s customers are diversified and are located on several continents. For its equipment, particularly its proton therapy systems, the Company depends each year on a number of orders that are filled over several accounting periods. In this field of business, progress or lack of progress on an order, or changes in an order that were not anticipated at the beginning of the year, can have a significant impact over several accounting periods. On the other hand, the lead time for filling orders gives the Company good visibility in its field several months before they are filled.

Intellectual property (patents) The Company holds intellectual property rights. Some of these rights are generated by employee or production process know-how and are not protected by patent. The Company holds patents, but it cannot guarantee that these patents are broad enough to protect the Company’s intellectual property rights and to keep its competitors from gaining access to similar technologies. The Company cannot guarantee that the defection of certain employees would not have a negative impact on its intellectual property rights.

Competition and risks of rapid product obsolescence At the current time, IBA has no direct competitor active in all of the markets in which it is present. However, in some of its markets, it is competing against some of the world’s largest corporations. These corporations have highly developed sales and marketing networks and, more importantly, extensive financial resources that cannot compare with those of IBA. Furthermore, there is always the possibility that a new technology (a revolutionary cancer treatment therapy, for example) may be developed that would render a portion of IBA’s current product line obsolete. However, developing and marketing a new technology takes a relatively long time.

Penalties and warranties Some contracts may contain warranties or penalties. While the warranty or penalty is generally a few percent of the amount of the contract in the case of conventional sales contracts, it may be significantly higher in the context of public-private partnerships inasmuch as the penalties must cover the associated financing. Such clauses are applicable to a limited number of contracts and are essentially found only in the context of proton therapy contracts. The possibility that a customer may one day exercise such a warranty or penalty clause cannot be excluded.


Events subsequent to the end of the reporting period

In early February 2009, IBA and Eczacibasi-Monrol Nuclear Products AS joined forces to develop the market for PET and SPECT radiopharmaceuticals in the Balkans, the Middle East, North African, and Central and Eastern Europe. This means that IBA’s PET radiopharmaceuticals production and distribution network now links 52 facilities around the world.

In the dispute between IBA and the Swedish National Tax Board, the Swedish administrative court of appeal handed down its decision on March 23, 2009. The court ruled against the Tax Board and in favor of IBA. With the assistance of its tax advisors, IBA is currently weighing the probability that the Tax Board will file a final appeal. Pending completion of its analysis, IBA still considers the risk of losing on appeal to be high and is maintaining the provision of SEK 12.9 million (EUR 1.2 million) presented at December 31, 2008.

General outlook for 2009In view of the current difficult economic climate, management took steps in mid-2008 to control spending, commitments, and investment. Today, the Company is pleased that a growing portion of its operations are either recurring, in a defensive industry (healthcare), or both. In 2008, recurring operations represented 62 percent of the Group total (67 percent with CISBIO over 12 months). We will be able to take 2009 in stride. However, our growth may be affected by the financial crisis, particularly in the area of proton therapy equipment, where sales are often contingent on the customer’s ability to obtain financing. The Group believes it can maintain its overall profit level in 2009 and remains confident that it will be able to achieve its medium-range objective of increasing operating profits by 10 percent, even if attainment may be slightly postponed.

IBA’s long-term strategy is based on the following:The World Health Organization believes that the number of new cancer cases will continue to climb steeply over the next 20 years.Radiation therapy will continue to be one of the principal means of treatment.

Molecular imaging will gain broader use, resulting in more accurate diagnoses and treatments that are better tailored to the patient.IBA continues to see itself as present on several growing markets in the coming years.IBA is the world leader in these niche markets.

Given the Company’s good performance and good cash position, the Board of Directors has decided to ask the shareholders to approve a dividend of EUR 0.08 per share at the Ordinary General Meeting of May 13, 2009. Despite recurring profits on a par with 2007, it believes that it would be prudent to declare a smaller dividend than the EUR 0.17 per share paid in 2008, in view of the uncertainty of the general economic environment.

Management report



IFRS consolidated financial statements for the year ended December 31, 2008

Introduction

Ion Beam Applications S.A. (the “Company” or the “parent”), founded in 1986, and its subsidiaries (together, the “Group” or “IBA”) are committed to technological progress in the field of cancer diagnosis and therapy and deliver efficient, dependable solutions providing unequaled precision. IBA also offers innovative solutions for everyday hygiene and safety.

The Company is a limited company incorporated and domiciled in Belgium. The address of its registered office is Chemin du Cyclotron, 3; B-1348 Louvain-la-Neuve, Belgium.

The Company is listed on the pan-European stock exchange Euronext and is included in the Bel Mid Index.

Consequently, IBA has agreed to follow certain rules to enhance the quality of financial information provided to the market. These include:

Publication of its annual report, including its audited annual consolidated financial statements, within four months from the end of the financial year

Publication of a half-yearly report covering the first six months of the financial year within two months from the end of the second quarter

Publication of half-yearly and annual consolidated financial statements prepared in accordance with IFRS

Audit of its annual consolidated financial statements by its auditors in accordance with the auditing standards set forth by the International Federation of Accountants (“IFAC”)

These consolidated financial statements were approved for release by the Board of Directors on April 2, 2009.


Consolidated balance sheet at December 31, 2008

The Group has chosen to present its balance sheet on a current/non-current basis.The notes on pages 34 to 85 are an integral part of these consolidated financial statements.

notes December 31, 2008 December 31, 2007

(EUR ‘000) (EUR ‘000)

AssEts

Goodwill 7 28 762 26 538

Other intangible assets 7 37 768 4 619

Property, plant, and equipment 8 78 693 59 792

Investments accounted for using the equity method 10 3 643 6 038

Other investments 10 2 420 2 343

Deferred tax assets 11 33 986 33 312

Other long-term assets 12 65 111 18 641

non-current assets 250 383 151 283

Inventories and contracts in progress 13 85 759 40 899

Trade receivables 14 74 820 44 243

Other receivables 14 42 341 27 943

Short-term financial assets 21 2 275 1 860

Cash and cash equivalents 15 53 943 58 210

Current assets 259 138 173 155

totAl AssEts 509 521 324 438

EQUIty AnD lIABIlItIEs

Capital stock 16 37 285 36 215

Capital surplus 16 124 358 115 199

Treasury shares 16 -7 563 -6 746

Reserves 17 9 220 8 397

Currency translation difference 17 -17 064 -12 309

Retained earnings 17 5 446 70

Capital and reserves 151 682 140 826

minority interests 684 655

EQUIty 152 366 141 481

Long-term borrowings 18 11 885 17 854

Deferred tax liabilities 11 470 369

Provisions 19 98 371 12 313

Other long-term liabilities 20 45 515 33 763

non-current liabilities 156 241 64 299

Short-term liabilities 18 24 252 8 328

Other short-term liabilities 21 2 498 0

Trade payables 22 71 518 51 191

Current income tax liabilities 1 942 1 115

Other payables 23 100 704 58 024

Current liabilities 200 914 118 658

totAl lIABIlItIEs 357 155 182 957

totAl EQUIty AnD lIABIlItIEs 509 521 324 438



Consolidated income statement for the year ended December 31, 2008The Group has chosen to present its income statement using the “function of expenses” method.


(EUR ‘000) (EUR ‘000)

Sales and services 332 607 213 849

Cost of sales and services 220 272 144 004

Gross profit 112 335 69 845

Selling and marketing expenses 30 368 21 105

General and administrative expenses 44 215 19 785

Research and development expenses 27 001 17 167

Other operating expenses 24 18 871 8 714

Other operating (income) 24 -25 230 -3 966

Financial expenses 25 13 584 4 353

Financial (income) 25 -10 947 -3 897

Share of (profit)/loss of companies consolidated using the equity method 10 2 363 -278

Profit/(loss) before taxes 12 110 6 862

Tax (income)/expenses 26 6 781 -6 983

Profit for the period from continuing operations 5 329 13 845

Profit/(loss) for the period from discontinued operations 6 0 1

Profit for the year 5 329 13 846

Attributable to:

Equity holders of the parent 5 300 13 930

Minority interests 29 -84

5 329 13 846

Earnings per share from continuing and discontinued operations (EUR per share)

- Basic 35 0.20 0.54

- Diluted 35 0.20 0.52

Earnings per share from continuing operations (EUR per share)

- Basic 35 0.20 0.54

- Diluted 35 0.20 0.52

Earnings per share from discontinued operations (EUR per share)

- Basic 35 0.00 -0.06

- Diluted 35 0.00 -0.06


Consolidated statement of recognized income and expense for the year ended December 31, 2008

December 31, 2008 December 31, 2007

(EUR ‘000) (EUR ‘000)

Changes in available-for-sale financial asset reserves 65 -194

Changes in cash flow hedge reserves -1 113 1 580

Changes in post-employment benefit reserves -323 0

Changes in share-based payment reserves 2 052 2 266

Other changes in reserves 142 0

Changes in currency translation difference -3 942 -7 913

Permanent financing-related changes -1 914 -474

Income tax-related changes 1 101 0

net result from continuing operations recognized directly in reserves -3 955 -4 735

Net income/(expense) from discontinued operations recognized directly in reserves 0 0

Profit/(loss) for the period 5 300 13 930

total recognized income /(expense) 1 345 9 195

Attributable to: Group 1 316 9 279

Minority interests 29 -84


Consolidated statement of changes in shareholders’ equity

(EUR ‘000) Attributable to equity holders of the Company minority

interests

total

equityCapital stock

Capital surplus

treasury shares

Hedging reserves

other reserves

Currency translation difference

Retained earnings

Balance at January 1, 2007

35 747 200 899 -256 222 4 523 -3 922 -101 384 500 136 329

Cash flow hedges, net of tax

1 580 1 580

Other movements 89 239 328


-194 -8 387 -8 581

net income/(expenses) recognized directly in equity

1 580 -194 -8 387 89 239 -6 673

Profit/(loss) for the period

13 930 -84 13 846

total result for the period

1 580 -194 -8 387 14 019 155 7 173

Purchase of treasury shares

-6 490 -6 490

Employee stock options 2 266 2 266

Increase/(reduction) of capital stock/capital surplus

468 1 735 2 203

Other movements -87 435 87 435 0

Balance at December 31, 2007

36 215 115 199 -6 746 1 802 6 595 -12 309 70 655 141 481

Balance at January 01, 2008

36 215 115 199 -6 746 1 802 6 595 -12 309 70 655 141 481

Cash flow hedges, net of tax

-1 113 -1 113

Changes in post-employment reserves

-323 -323

Other movements 207 4 488 - 4 695


-4 755 -4 755

net income/(expenses) recognized directly in equity

-1 113 -116 -4 755 4 488 -1 496

Profit/(loss) for the period

5 300 29 5 329

total result for the period

-1 113 -116 -4 755 9 788 29 3 833

Purchase of treasury shares

-817 -817

Dividends -4 412 -4 412

Employee stock options 2 052 2 052

Increase/(reduction) of capital stock/capital surplus

1 070 9 159 10 229

Other movements 0

Balance at December 31, 2008

37 285 124 358 -7 563 689 8 531 -17 064 5 446 684 152 366



Consolidated cash flow statement

The Group has chosen to present the cash flow statement using the indirect method.


(EUR ‘000) (EUR ‘000)

CAsH FloW FRom oPERAtInG ACtIvItIEs

net profit/(loss) for the period 5 300 13 930

Adjustments for:

Depreciation and impairment of property, plant, and equipment 8 12 586 5 755

Amortization and impairment of intangible assets 7 3 404 1 554

Write-off on receivables 14 1 122 -1 489

Changes in fair value of financial assets (gains)/losses 3 897 6

Change in provisions 19 2 148 2 546

Taxes 26 6 781 -6 983

Share of result of associates and joint ventures accounted

for using the equity method 10 2 363 -280

Other non-cash items 28 2 927 540

net profit/(loss) before changes in working capital 40 528 15 579

Trade receivables, other receivables, and deferrals -6 394 -25 218

Inventories and contracts in progress -28 414 1 177

Trade payables, other payables, and accruals 8 515 28 771

Changes in working capital -26 293 4 730

Income tax paid/received, net -1 647 -1 701

Interest paid 1 944 1 747

Interest received -2 616 -2 321

net cash (used in)/generated from operations 11 916 18 034

CAsH FloW FRom InvEstInG ACtIvItIEs

Acquisitions of property, plant, and equipment -18 672 -21 668

Acquisitions of intangible assets -6 043 -2 104

Disposals of fixed assets 2 866 324

Acquisitions of subsidiaries, net of acquired cash 6 47 195 51

Acquisitions of third party and equity-accounted companies -4 375 0

Disposals of subsidiaries and equity-accounted companies, net of assigned cash 0 1

Acquisitions of non-current financial assets and loans granted -34 076 0

Other investing cash flows 28 -8 986 1 050

net cash (used in)/generated from investing activities -22 091 -22 346

CAsH FloW FRom FInAnCInG ACtIvItIEs

Proceeds from borrowings 11 162 9 400

Repayments of borrowings -10 810 -8 173

Interest paid -1 944 -1 747

Interest received 2 616 2 321

Capital increase (or proceeds from issuance of ordinary shares) 10 050 1 905

Purchase of treasury shares -818 -6 490

Dividends paid -4 018 0

Other financing cash flows 28 -934 287

net cash (used in)/generated from financing activities 5 304 -2 497

net cash and cash equivalents at beginning of the year 58 210 67 600

Change in net cash and cash equivalents -4 871 -6 809

Exchange gains/(losses) on cash and cash equivalents 604 -2 581

net cash and cash equivalents at end of the year 53 943 58 210


Note

1. Summary of significant Group accounting policies under IFRS2. Description of financial risk management policies3. Critical accounting estimates and judgments4. Segment information5. List of subsidiaries and equity-accounted investments6. Business combinations and other changes in the composition of the Group7. Goodwill and other intangible assets8. Property, plant, and equipment9. Lease arrangements10. Investments accounted for using the equity method and other investments11. Deferred taxes12. Other long-term assets13. Inventories and contracts in progress14. Trade and other receivables15. Cash and cash equivalents16. Capital stock and stock options17. Reserves18. Borrowings19. Provisions20. Other long-term liabilities21. Other short-term financial assets and liabilities22. Trade payables23. Other payables24. Other operating expenses and income25. Financial expenses and income26. Income taxes27. Employee benefits28. Cash flow statement29. Contingent liabilities30. Commitments31. Related party transactions32. Fees for services rendered by the statutory auditors33. IFRS standards and IFRIC interpretations not yet effective or applied by the Group34. Events after the balance sheet date35. Earnings per share

Notes to the consolidated financial statements

Page

3444505254555860616163646465666668697172727373737475767777787981828484



1.1 IntroductionThe significant IFRS accounting policies applied by the Group in preparing the IFRS consolidated financial statements are described below.

1.2 Basis of preparationIBA’s consolidated financial statements for the year ended December 31, 2008 have been drawn up in compliance with IFRS (“International Financial Reporting Standards”) and IFRIC interpretations (“International Financial Reporting Interpretations Committee”) adopted by the European Union, issued and effective or issued and early adopted at December 31, 2008.

These consolidated financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial instruments at fair value.

These financial statements have been prepared on an accrual basis and on the assumption that the entity is a going concern and will continue in operation in the foreseeable future.

The preparation of financial statements in accordance with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise judgment in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements, are disclosed in Note 3.

New standards, amendments, and interpretations to existing standards have been published that are mandatory for accounting periods beginning on or after January 1, 2009. The Group has not early adopted these standards and is currently assessing the impact of such standards and IFRIC interpretations.

1.3 ConsolidationThe parent and all of its controlled subsidiaries are included in the consolidation.

1.3.1 subsidiariesAssets and liabilities, rights and commitments, and income and expenses of the parent and its controlled subsidiaries are consolidated in full. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. It is presumed to exist when the IBA Group holds more than 50 percent of the entity’s voting rights. This presumption may be rebutted if there is clear evidence to the contrary. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls an entity.

Consolidation of a subsidiary takes place from the date of acquisition, which is the date on which control of the net assets and operations of the acquiree are effectively transferred to the acquirer. From the date of acquisition, the parent (the acquirer) incorporates into the consolidated income statement the financial performance of the acquiree and recognizes in the consolidated balance sheet the acquired assets and liabilities (at fair value), including any goodwill arising on the acquisition. Subsidiaries are deconsolidated from the date on which control ceases. The following treatments are applied on consolidation:The carrying amount of the parent’s investment in each subsidiary and the parent’s portion of equity of each subsidiary is eliminated.Minority interests in the net assets of consolidated subsidiaries are identified and presented in the consolidated balance sheet separately in the equity caption “Minority interests.”The portion of the result of the fully consolidated subsidiaries attributable to shares held by entities outside the Group is presented in the consolidated income statement in the caption “Result attributable to minority interests.”

1. summary of significant Group accounting policies under IFRs


Intra-group balances and transactions and unrealized gains and losses on transactions between Group companies are eliminated in full.Consolidated financial statements are prepared applying uniform accounting policies to like transactions and other events in similar circumstances.

1.3.2 AssociatesAn associate is an entity in which the investor has significant influence, but which is neither a subsidiary nor a joint venture (see next subsection) of the investor. Significant influence is the power to participate in the financial and operating policy decisions of the investee but not to control those policies. It is presumed to exist when the investor holds at least 20 percent of the investee’s voting power but not to exist when less than 20 percent is held. This presumption may be rebutted if there is clear evidence to the contrary.

All associates are accounted for using the equity method. The participating interests are separately included in the consolidated balance sheet (in the caption “Investments accounted for using the equity method”) at the closing date at an amount corresponding to the proportion of the associate’s equity (as restated under IFRS), including the result for the year. Dividends received from an investee reduce the carrying amount of the investment.

The portion of the result of associates attributable to the Group is included separately in the consolidated income statement in the caption “Share of profit/loss of companies consolidated using the equity method.”

Unrealized profits and losses resulting from transactions between an investor (or its consolidated subsidiaries) and associates are eliminated to the extent of the investor’s interest in the associate.

1.3.3 Jointly controlled entitiesSimilarly as for associates, the equity method is used for entities over which the Group exercises joint control (i.e. joint ventures).

1.3.4 treatment of goodwill or negative goodwillBusiness combinations are the bringing together of separate entities or businesses into one reporting entity. A business is a set of activities and assets applied and managed together in order to provide a return or any other economic benefit to its investors. In all business combinations, one entity (the acquirer) obtains control that is not transitory of one or more other entities or businesses (the acquiree).

All business combinations (acquisitions of businesses) arising after January 1, 2004 are accounted for using the purchase method. The acquirer measures the cost of the business combination at the acquisition date (the date on which the acquirer obtains control over the net assets of the acquiree) and compares it with the fair value of the acquiree’s identifiable net assets, liabilities, and contingent liabilities. The difference between the two represents goodwill (if this difference is positive) or negative goodwill (if this difference is negative).

For all business combinations arising before January 1, 2004, no retrospective restatement to fair value has been made.

Similar rules have been applied to investments accounted for under the equity method, except that any goodwill arising on such investment is included in the carrying amount of the investment.

Negative goodwill arising on such investments is included in the determination of the entity’s share of the investee’s profit or losses in the period in which the investment is acquired.

Goodwill is not amortized under IFRS but instead is tested for impairment annually (or more frequently if circumstances so require).

Negative goodwill is recognized as profit under IFRS.

1.3.5 Acquisition of minority interestsThe excess of the acquisition cost of minority interests over the balance for these minority interests on the balance sheet is deducted from equity (“economic unit model”).



1.3.6 translation of financial statements of foreign operationsAll monetary and non-monetary assets (including goodwill) as well as liabilities are translated at the closing rate. Income and expenses are translated

at the rate of the date of the transaction (historical exchange rate) or at an average rate for the month. The principal exchange rates used for conversion to EUR are as follows:

Closing rate at Average annual Closing rate at Average annual December 31, 2008 rate 2008 December 31, 2007 rate 2007

USD 1.4040 1.4712 1.4719 1.3701

SEK 10.8988 9.6254 9.4156 9.2523

GBP 0.9682 0.7962 0.7369 0.6846

CNY 9.5655 10.2481 10.7358 10.4317

INR 68.9817 64.1041 58.0314 56.6065

JPY 126.9440 152.5253 158.1280 161.2972

1.4 Intangible fixed assetsRecognition as an intangible fixed asset is required when (1) this asset is identifiable, i.e. separable (it can be sold, transferred, or licensed) or where it arises from contractual or other legal rights; (2) it is probable that future economic benefits attributable to the asset will flow to IBA; (3) IBA can control the resource, and (4) the cost of the asset can be measured reliably.

Intangible assets are carried at acquisition cost less any accumulated amortization and any accumulated impairment loss.

Cost includes the fair value of the consideration given to acquire the asset and any costs directly attributable to the transaction, such as relevant professional fees or non-refundable taxes.

Indirect costs as well as general overheads are not included. Expenditure previously recognized as expense is not included in the cost of the asset.

Costs arising from the research phase of an internal project are expensed as incurred. Costs arising from the development phase of an internal project (product development project

or IT project) are recognized as an asset when IBA can demonstrate the following: technical feasibility, intention to complete development, how the intangible asset will generate probable future economic benefits (e.g. the existence of a market for the output of the intangible asset or for the intangible asset itself), availability of resources to complete development, and ability to measure the attributable expenditure reliably. Maintenance costs, as well as costs for minor upgrades intended to maintain (rather than increase) the level of performance of the asset, are expensed as incurred.

The above recognition criteria are fairly stringent and are applied prudently.

No borrowing cost is included in the acquisition cost of intangible assets.

The cost of the intangible assets is allocated on a systematic basis over the useful life of the asset using the straightline method.

The applicable useful lives are as follows:

Intangible assets Useful life

Product development costs 3 years, except if a longer useful life is justified

(however not exceeding 5 years)

IT development costs for the primary softwares (e.g. ERP) 5 years

Other software 3 years

Concessions, patents, licenses, know-how, 3 years, except if a longer useful life is justified

trademarks, and other similar rights

Goodwill Not amortized but tested for impairment at least annually


Amortization commences only when the asset is available for use in order to achieve proper matching of cost and revenue.

1.5 tangible fixed assets (property, plant, and equipment)Tangible fixed assets are carried at acquisition cost less any accumulated depreciation and any accumulated impairment loss.

Cost includes the fair value of the consideration given to acquire the asset (net of discounts and rebates) and any directly attributable cost of bringing the asset to working condition for its intended use (inclusive of import duties and taxes). Directly attributable costs are the cost of site preparation, delivery costs, installation costs, relevant professional fees, and the estimated cost of dismantling and removing the asset and restoring the site (to the extent that such a cost is recognized as a provision).

No borrowing cost is included in the acquisition cost of tangible fixed assets.

Each part of an item of property, plant, and equipment with a cost that is significant in relation to the total cost of the item is separately depreciated over its useful life using the straightline method. The depreciable amount is the acquisition cost, except for vehicles. For vehicles, it is the acquisition cost less the residual value of the asset at the end of its useful life.

Maintenance or repair costs whose objective is to maintain rather than increase the level of performance of the asset are expensed as incurred.

The applicable useful lives are as follows:


tangible fixed assets Useful life

Land Not depreciated

Office buildings 33 years

Industrial buildings 33 years

Cyclotrons and vaults 15 years except in specific rare circumstances where a

different useful life is justified

Laboratory equipment 5 years

Other technical equipment 5 to 10 years

Hardware 3 to 5 years (5 years for mainframes)

Furniture and fittings 5 to 10 years

Vehicles 2 to 5 years

1.5.1 lease transactions involving IBA as a lesseeA finance lease, which transfers substantially all the risks and rewards incident to ownership, is recognized as an asset and a liability at amounts equal to the fair value of the leased assets or, if lower, the present value of the minimum lease payments (= sum of capital and interest portions included in the lease payments).

Lease payments are apportioned between the finance charge and the reduction of the outstanding liability. The depreciation policy for leased assets is consistent with that for similar assets owned.

1.5.2 Investment propertiesInvestment properties for the Group’s own use are carried at acquisition cost less any accumulated depreciation and any impairment loss.

1.6 Impairment of intangible and tangible fixed assetsAn impairment loss is recognized when the carrying amount of an asset exceeds its recoverable amount, which is the higher of the following two amounts: fair value less costs to sell (the money that IBA can recover through sale) or value in use (the money that IBA can recover if it continues to use the asset).

When possible, impairment tests have been performed on individual assets. When, however,


it is determined that assets do not generate independent cash flows, the test is performed at the level of the cash-generating unit (CGU) to which the asset belongs (CGU = the smallest identifiable group of assets generating inflows that are largely independent from the cash flows from other CGUs).

Goodwill arising on a business combination is allocated among the Group’s CGUs that are expected to benefit from synergies as a result of the business combination. This allocation is based on management’s assessment of the synergies gained and is not dependent on the location of the acquired assets.

Since it is not amortized, goodwill is tested for impairment annually, along with the related CGU (or more frequently depending on circumstances), even if no indication of impairment exists. Other intangible and tangible fixed assets/CGUs are tested only if there is an indication that the asset is impaired.

Any impairment loss is first charged against goodwill. Any impairment loss exceeding the book value of goodwill is then charged against the other CGUs’ fixed assets only if the recoverable amount is below their net book value. Reversals of impairment losses (other than on goodwill) are recorded if justified.

1.7 InventoriesInventories are measured at the lower of cost and net realizable value at the balance sheet date.

The cost of inventories comprises all costs incurred in bringing inventories to their present location and condition, including indirect production costs but excluding borrowing costs. Administrative overheads that do not contribute to bringing inventories to their present location and condition, selling costs, storage costs, and abnormal amounts of wasted materials are not included in the cost of inventories.

The standard cost method is used. When the standard cost of an item of inventory at period-end does not approximate its actual cost, it is adjusted to its actual cost. The allocation of fixed production

overheads to the production cost of inventories is based on the normal capacity of the production facilities.

The cost of inventories that are ordinarily interchangeable is allocated by using the weighted average cost formula. The same cost formula is used for all inventories that have a similar nature and use to the entity.

Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale (e.g. sales commissions).

IBA books a write-down when the net realizable value at the balance sheet date is lower than the cost.

IBA applies the following policy for write-down on slow-moving items:If no movement after 1 year: write-off over 3 years;If movement occurs after write-off: reversal of write-off.

However, inventory is valued individually at year-end. Exceptions to the above general rule are made when justified.

1.8 Revenue recognition (excluding contracts in progress, which are covered in the following section)Revenue arising from the sale of goods is recognized when an entity transfers the significant risks and rewards of ownership, and recovery of the related receivables are reasonably assured.

The transaction is not a sale and revenue is not recognized where (1) IBA retains an obligation for unsatisfactory performance not covered by normal warranty provisions; (2) the receipt of revenue from a particular sale is contingent on the derivation of revenue by the buyer from its sale of the goods; (3) the buyer has the power to rescind the purchase for a reason specified in the sales contract; and (4) IBA is uncertain about the probability of return.

Revenue is normally recognized when the buyer



accepts delivery, and installation and inspection are complete. However, revenue is recognized immediately upon the buyer’s acceptance of delivery when installation is simple in nature.

Revenue from the rendering of services is recognized by reference to the stage of completion of the transaction at the balance sheet date using rules similar to those for construction contracts (see next section); in other words, revenue is recognized as the related costs are incurred. Unless it is clear that costs are not incurred on a straightline basis, revenues are spread evenly over the period of the services.

The recognition criteria are applied to the separately identifiable components of a single transaction when it is necessary to reflect the substance of the transaction.

Interest income is recognized using the effective yield method. Royalties are recognized on an accrual basis in accordance with the substance of the relevant agreement. Dividends relating to year N are recognized when the shareholder’s right to receive payment is established (i.e. in year N+1).

1.9 Contracts in progressContract costs comprise: Direct and indirect production costs (same as for inventories, see above)Such other costs as are specifically chargeable to the customer under the terms of the contractCosts incurred in securing the contract if they can be separately identified and measured reliably and if it is probable that the contract will be obtained

When the outcome of a construction contract (i.e. estimation of the final margin) can be estimated reliably, contracts in progress are measured as production cost increased, according to the stage of completion of the contract, by the difference between the contract price and production cost (“percentage of completion” method). The stage of completion is determined by comparing actual costs incurred to date with estimated costs to completion. (Costs that do not reflect work performed, such as commissions and royalties are excluded for this calculation.) The percentage of

completion is applied on a cumulative basis.

When the outcome of the contract cannot be estimated reliably, revenue is recognized only to the extent of costs incurred that it is probable will be recovered; contract costs are recognized as an expense as incurred. When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognized as an expense immediately in the income statement.

The Group presents as an asset the net amount due from customers on contract work for all contracts in progress for which costs incurred plus recognized profits (less recognized losses) exceed progress billings. Progress billings not yet paid by customers and retention are included in trade receivables.

The IBA Group presents as a liability the net amount due to customers on contract work for all contracts in progress for which progress billings exceed costs incurred plus recognized profits (less recognized losses).

When financial guarantees must be given to third parties in connection with a contract and these guarantees involve a financial risk for IBA, a financial liability is recognized.

1.10 ReceivablesReceivables are recognized initially at fair value and subsequently measured at amortized cost, i.e. at the net present value of the receivable amount. Unless the impact of discounting is material, the nominal value is taken. Receivables are written down when receipt of all or part is uncertain or doubtful.

In general, IBA applies the following rule to write-downs of bad or doubtful debts:25% after 90 days overdue50% after 180 days overdue75% after 270 days overdue100% after 360 days overdue

However, the recoverability of receivables is assessed on a case-by-case basis, and exceptions to the above general rule are made when justified.


1.11 Financial assets The Group classifies its financial assets in the following categories: loans and receivables, available-for-sale financial assets, and financial assets at fair value through profit or loss.

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not listed on an active market and are not held for trading. Gains and losses on loans and receivables are recorded when the loans and receivables are derecognized or impaired.

Term deposits are classified as loans and receivables under IAS 39.

Investments in interest bearing securities, as well as investments in shares (other than shares in subsidiaries, joint ventures, and associates) are accounted for as available-for-sale financial assets. They are recorded at fair value, with gains and losses reported in equity, until they are impaired or sold, at which time the gains or losses accumulated in equity are recycled into the income statement. For financial assets that are classified as available for sale, a significant or prolonged decline in the fair value of the investment below its cost is objective evidence of impairment. Impairment losses on these instruments are charged to income. Increases in their fair value after impairment are recognized directly in equity.

Revaluation of certain financial assets used to manage the Group’s cash position, that includes derivative products, is recorded at fair value through profit or loss if the derivative instrument cannot be valued separately.

When there are indicators of impairment, all financial assets are subject to an impairment test. The indicators should provide objective evidence of impairment as a result of a past event that occurred subsequent to the initial recognition of the asset. Expected losses as a result of future events are not recognized, no matter how likely.

1.12 Cash and cash equivalentsCash balances are recorded at their nominal value. Cash equivalents are short-term, highly liquid

investments that can be used for any purpose and have a maturity date not exceeding three months from acquisition date. Cash and cash equivalents include bank overdrafts.

Amounts dedicated to specific events and invested in liquid instruments that are renewed automatically until the occurrence of that event, are qualified as “restricted” are and reclassified as other long term receivables.

1.13 Capital stockOrdinary shares are classified in the caption “Capital stock.” Treasury shares are deducted from equity. Movements on treasury shares do not affect the income statement.

1.14 Deferred charges and accrued incomeDeferred charges are the prorated amount of charges incurred in the current or prior financial periods but which are related to one or more subsequent periods. Accrued income is the prorated amount of income earned in the current or prior periods which will be received only in subsequent periods.

1.15 Capital grants Capital grants are recorded as deferred income. Grants are recognized as income at the same rate as the rate of depreciation of the related fixed assets.

1.16 ProvisionsA provision is recognized only when: IBA has a present obligation to transfer economic benefits as a result of past eventsIt is probable (more likely than not) that such a transfer will be required to settle the obligationA reliable estimate of the amount of the obligation can be made

When the impact is likely to be material (for long-term provisions), the amount recognized as a provision is estimated on a net present value basis (discount factor). The increase in provision due to the passage of time is recognized as an interest expense.


A present obligation arises from an obligating event and may take the form of either a legal obligation or a constructive obligation. (A constructive obligation exists when IBA has an established pattern of past practice that indicates to other parties that it will accept certain responsibilities and as a result has created a valid expectation on the part of those other parties that it will discharge those responsibilities.) An obligating event leaves IBA no realistic alternative to settling the obligation, independently of its future actions.

Provisions for site repair, restoration, and decommissioning costs are recorded as appropriate in application of the above.

If IBA has an onerous contract (that is, if the unavoidable costs of meeting the obligations under the contract exceed the economic benefits expected to be received under it), the present obligation under the contract is recognized as a provision.

A provision for restructuring is recorded only if IBA can demonstrate that the Company is under an obligation to restructure at the balance sheet date. Such obligation must be demonstrated by (a) preparing a detailed formal plan identifying the main features of the restructuring and (b) raising a valid expectation to those affected that it will carry out the restructuring by starting to implement the plan or by announcing its main features to those affected.

1.17 Pensions and other employee benefits1.17.1 PensionsPremiums paid in relation to a defined contribution plan are expensed as incurred. Defined contribution plans are post-employment benefit plans under which IBA pays fixed contributions into a separate entity (a fund) and will have no legal or constructive obligation to pay further contributions if the fund does not hold sufficient assets to pay all employee benefits relating to employee service in the current and prior periods.

As from the date of acquisition of CIS Bio International S.A.S. and its subsidiaries, the Group

has defined benefit plans. These entitlements arising from commitments to employees of CIS Bio International S.A.S. are recorded in contingency provisions and are as follows: Entitlements of employees active at year-end in the form of benefits, supplements, and other retirement compensation not covered by the pension or insurance funds; andEntitlements conferred as a result of the lowering of the retirement age for employees working or having worked in hazard areas.

Obligations arising from the application of these defined benefit plans are valued according to the projected unit credit method and are discounted because they may be discharged many years after the related services were performed. Actuarial calculations are required to obtain a reliable estimate of the value of accumulated employee benefits for services rendered. Actuarial differences may result from an increase or decrease in the present value of a defined benefit obligation. These actuarial differences include adjustments based on experience (the impact of disparities between previous actuarial assumptions and what actually happened) and the effect of different actuarial assumptions (such as an adjustment of the employee turnover rate or a change in the discount rate). For the valuation of defined benefit liabilities, the Group has chosen to recognize the entire actuarial differences immediately in equity in a statement of changes in equity called the “Statement of recognized the income and expense.”

The cost of past services is the increase in the present value of the defined benefit obligation arising from employee services in prior years. The cost of past services is recognized (in operating results) on a straightline basis over the average remaining service period before the associated benefits vest. The other elements are included in financial results as other financial (income)/expense.



1.17.2 stock option plans (share-based pay-ments)Share-based payments are transactions to be paid with shares, stock options, or other equity instruments (granted to employees or other parties) and transactions paid in cash or other assets when the amount payable is based on the price of the entity’s shares.

All transactions involving share-based payments are recognized as assets or expenses, as appropriate.

Equity-settled share-based payment transactions are measured at the fair value of the goods or services received at the date on which the entity recognizes the goods and services. If the fair value of goods or services cannot be estimated reliably (as in the case of employee services), the entity should use the fair value of the equity instruments granted. Equity-settled share-based payments are not remeasured.

Cash-settled share-based payments are measured at the fair value of the liability. IBA does not have plans of this type.

1.18 Deferred taxesThe comprehensive method and the liability method are used. Deferred taxes are recorded on the temporary differences arising between the carrying amount of the balance sheet items and their tax base, using the rate of tax expected to apply when the asset is recovered or the liability is settled.

There are three exceptions to the general principle that deferred taxes are recognized on all temporary differences. Deferred taxes are not recognized for: Goodwill that is not amortized for tax purposes.Initial recognition of an asset or liability in a transaction that is not a business combination and that affects neither accounting profit nor taxable profit.Investments in subsidiaries, branches, associates, and joint ventures. Deferred taxes may be recognized only when IBA has control over the distribution and it is likely that dividends will be distributed in the foreseeable future.

A deferred tax asset is recognized for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilized. The same principle applies to recognition of deferred tax assets for unused tax losses carried forward. This assessment is subject to the principle of prudence.

Deferred taxes are calculated for each fiscal entity in the Group. IBA is able to offset deferred tax assets and liabilities only if the deferred balances relate to income taxes levied by the same taxation authority.

1.19 Payables after and within one yearPayables after and within one year are measured at amortized cost, i.e. at the net present value of the payable amount. Unless the impact of discounting is material, the nominal value is taken.

1.20 Accrued charges and deferred incomeAccrued charges are the prorated amount of expenses which will be paid in a subsequent financial period but relate to a prior period. Deferred income is the prorated amount of income received in the current or prior periods but related to a subsequent period.

1.21 Foreign currency transactionsForeign currency transactions are converted into the functional currency of the Group entity party to the transaction using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the conversion at the period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in the income statement.

Exchange differences arising from the consolidation of currency items that constitute part of the reporting entity’s net investment in a foreign entity (i.e. when settlement is neither planned nor likely to occur in the foreseeable future) are recorded in equity if the following two conditions are met: (1) the loan is made in either the functional currency of the reporting entity or the foreign


operation and (2) the loan is made between the reporting entity and a foreign operation.

1.22 Derivatives and hedging activitiesDerivative instruments are accounted for at fair value as from the date the contracts are entered into. Changes in the fair value of derivative instruments are accounted for in the income statement unless they qualify as cash flow hedges under IAS 39. The Group designates certain derivative transactions as hedges of the variability of the fair value of recognized assets or liabilities (fair value hedges); as unrecognized firm commitments; or as hedges of the cash flow variability arising from a specific risk associated with a recognized asset or liability or with a highly probable forecast transaction (cash flow hedges) or from net investments in foreign operations.

The Group documents, at the inception of the transaction, the relationship between the hedging instruments and the hedged item, as well as its risk management objective and strategy for undertaking various hedge transactions. The Group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in fair values or cash flows of hedged items.

a) Fair value hedgesChanges in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the income statement, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

b) Cash flow hedgesThe effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognized in equity. The gain or loss relating to the ineffective portion of the hedge is recognized immediately in the income statement.

Amounts accumulated in equity are recycled in the income statement in the periods when the hedged item affects profit or loss (e.g. when the forecast sale that is hedged takes place).

When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognized when the forecast transaction is ultimately recognized in the income statement. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to the income statement.

c) Derivatives that do not qualify for hedge accountingCertain derivative instruments do not qualify for hedge accounting. Such derivatives are recognized at fair value on the balance sheet, with changes in fair value recognized in the income statement. These instruments are designated as economic hedges to the extent that they are not used to speculate on positions.

1.23 segment informationA business segment is a distinguishable component engaged in providing products or services subject to risks and returns that are different from those of other business segments. A geographical segment is engaged in providing products or services within a specific economic environment subject to risks and returns that are different from those of segments operating in other economic environments.



2. Description of financial risk management policies

2.1 Financial risk factorsThe Group’s activities expose it to a variety of financial risks: mainly market risk (including currency risk), credit risk, liquidity risk, and interest rate risk. The Group’s overall financial risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Group’s financial performance. The Group uses derivative financial instruments to hedge certain risk exposures.Financial risk management is carried out by a central treasury department (Group Treasury) under policies approved by the Audit Committee of the Board of Directors. These policies provide written principles for overall financial risk management, as well as written policies covering specific areas, such as foreign exchange risk, use of derivative financial instruments and non-derivative financial instruments, and investing excess liquidity. Group Treasury identifies, evaluates, and hedges financial risks in close cooperation with the Group’s operating units.

2.1.1 market riska) Foreign exchange riskThe Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with respect to the U.S. dollar, the Chinese yuan, the British pound, and the Swedish krona. Foreign exchange risk arises from future and committed commercial transactions, recognized financial assets and liabilities, and net investments in foreign operations.

To manage foreign exchange risk arising from future and committed commercial transactions and from recognized assets and liabilities denominated in a currency different from the entity’s functional currency, entities in the Group use foreign exchange contracts, transacted with Group Treasury. Group Treasury is responsible for hedging the net position in each foreign currency by using foreign exchange contracts entered into with banks when possible and appropriate.

For segment reporting purposes, each subsidiary

designates contracts with Group Treasury as fair value hedges or cash flow hedges, as appropriate. External foreign exchange contracts are designated at Group level as hedges of foreign exchange risk on specific assets, liabilities, or committed or future transactions on a gross basis.

The Group’s general hedging policy is to hedge any confirmed sales contracts denominated in a foreign currency as well as expected net operational cash flows when they can be reasonably predicted. Appropriate documentation is prepared in accordance with IAS 39. The CFO approves and the CEO is informed of significant hedging transactions, with reporting to the Audit Committee twice a year.

Inter-company loans denominated in foreign currencies are entered into to finance certain subsidiaries and expose the Group to fluctuations in exchange rate.

The Group has certain investments in foreign operations, whose net assets are exposed to foreign currency translation risk. Currency exposure arising from the net assets of the Group’s foreign operations is managed primarily through borrowings denominated in the relevant foreign currencies.

Currency transactional risk:The Group has some transactional currency exposure that arises from sales or purchases by an operating unit in currencies other than the unit’s functional currency. The transactional foreign currency risk mainly arises from open positions in the Belgian entities against the U.S. dollar.

Approximately 18 percent of the Group’s sales are denominated in currencies other than the functional currency of the operating unit making the sale, while almost 95 percent of costs are denominated in the unit’s functional currency. Where the Group considers that there are no natural hedging opportunities, forward exchange contracts and foreign currency options (vanilla and exotic) are used to cover currency exposure.


b) other market risksThe Group is exposed to securities risk because of commercial paper and shares held by the Group in the context of its excess cash management. Risk is mitigated by a conservative selection of highly rated, highly liquid investment products. However, the Company cannot foresee sudden changes in the ratings of these products or market changes that may impair liquidity.

2.1.2 Credit riskThe Group has no significant exposure to credit risk. The Company policy for large contracts is to have appropriate letters of credit issued prior to delivery of the equipment. The Company has also a general agreement with the Belgian national export credit insurance institution (OND) that provides systematic coverage of all large equipment transactions.

With respect to its Pharmaceuticals business segment, the Company has instituted a trade credit insurance policy in the United States. For the rest of the world, owing to the generally public nature

of the customers, risk can be held at acceptable levels by closely monitoring customer payments.

The table in section 2.2 presents the financial assets of the Group by valuation method. The carrying amount of these financial assets represents the maximum credit exposure of the Group. The fair value of a financial instrument is the price at which a party would accept the rights and/or obligations of this financial instrument from another independent party.

2.1.3 liquidity riskPrudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of outstanding credit facilities. Due to the dynamic nature of the underlying businesses, Group Treasury aims to maintain flexibility in funding by keeping credit lines available.

The table below summarizes the maturity profile of the Group’s financial liabilities.

December 31, 2007 Due less than 1-2 years 2-5 years Beyond total (EUR ‘000) 1 year 5 years

Financial liabilities

Bank borrowings 0 2 830 2 537 5 492 94 10 953

Financial leases 0 3 559 2 610 2 061 944 9 174

Other interest-bearing liabilities 0 517 4 079 0 0 4 596

Trade payables 13 500 37 693 0 0 0 51 193

Other ST & LT payables 5 974 37 548 13 629 6 612 30 597 94 360

December 31, 2008 Due less than 1-2 years 2-5 years Beyond total (EUR ‘000) 1 year 5 years


Bank borrowings 0 3 562 2 996 3 298 0 9 856

Financial leases 0 3 390 4 431 1 081 0 8 902

Other interest-bearing liabilities 645 5 296 517 0 0 6 458

Trade payables 11 875 59 643 0 0 0 71 518

Other ST & LT payables 5 143 100 635 7 788 16 419 29 097 159 082



2.1.4 Interest rate riskThe Group exposure to the risk of changes in market interest rates relates primarily to the Group’s long-term debt obligations with floating interest rates. The Group entered into interest rate swaps in order to limit the impact of interest rate fluctuation on its financial results. IBA does not apply the hedge accounting to these transactions, and this coverage is therefore revalued through profit and loss.

IBA analyzed the impact of a 1 percent fluctuation in interest rates on its consolidated income statement. The effect would have been insignificant.

2.1.5 Commodity riskThe Group’s large automotive fleet for its U.S. radiopharmaceutical distribution business exposes it to fluctuations in the price of gasoline. To cover this risk, the Group entered into a forward oil contract.

Per IAS 39, this coverage does not qualify for hedge accounting or fair value accounting and is therefore measured through profit and loss.

12.31.2007(EUR ‘000)

IAS 39 category

Carrying amount

Amorti-zed cost

Cost Fair value recognized

in equity

Fair value recognized

in profit and loss(impair-ments)/

reversals


in profit and loss –

other(expenses)/

income

Financial income/

(expenses)

Recogni-zed in BS according to IAS 39

Fair value

Financial assets

Trade receivables Loans and receivables

44 243 46 871 0 0 1 731 0 0 0 44 243

Other LT & ST receivables

Loans and receivables

44 931 44 931 0 0 0 0 0 0 44 931

Investment in third parties

Available for sale

2 343 0 1 855 -202 0 0 0 0 2 343

Cash and cash equivalents


58 210 58 210 0 0 0 0 2 321 0 58 210

Derivatives with a hedging rela-tionship

Cash Flow hedge

1 860 0 0 1 579 0 171 0 0 1 860

Derivatives-other FVPL1 1 462 0 0 0 0 451 0 0 1 462


Bank borrowings FLAC 2 799 2 799 0 0 0 0 -670 0 2 799

Financial leases FLAC 9 174 0 0 0 0 0 -912 9 174 9 174

Other interest-bearing liabilities

FLAC 4 596 0 4 596 0 0 0 -165 0 4 596

Trade payables FLAC 51 193 0 51 193 0 0 0 0 0 51 193

Other LT & ST payables

FLAC 94 360 0 94 360 0 0 0 0 0 94 360

FLAC: Financial liabilities measured at amortized cost.FVPL1: Fair value through profit and loss, held for trading.

2.2 Financial assets and liabilities, additional informationThe assets and liabilities of the Group are valued as follows:

46 | IBA AnnUAL RePORT 2008

The caption “Investments, FVPL2,” totaling EUR 0.743 million, covers the fair value of synthetic collateralized debt obligations at December 31, 2008. These synthetic collateralized debt obligations were purchased for EUR 3.0 million in the context of the contract for the sale of the proton therapy system to the University of Pennsylvania. In lieu of requiring an advance payment guarantee, this contract protected the buyer’s down payment by placing it in an escrow account. Seeking a low risk (AAA rated), highly liquid investment, the financial institution working with IBA on this project recommended investing in the most senior tranche of these financial products. The fair value of these synthetic Collateralized Debt Obligations was determined by a financial institution. Group management considers that the proposed fair value should be corrected at December 31, 2008 by 10 percent illiquidity

discount to better reflect the market value of this product. In all, revaluation to market resulted in a financial charge of EUR 2.2 million in 2008.

The captions “Derivatives with a hedging relationship” in assets and liabilities include the fair value of forward exchange contracts.

Under financial assets for 2007, “Derivative products–other” primarily reflects the fair value of an option to increase ownership interest in an associate (EUR 1.4 million).

Under financial assets for 2008, “Derivative products–other” primarily reflects the fair value of forward exchange contracts and forward currency options.Under financial liabilities for 2008, “Derivative products-other” primarily reflects the fair value of a forward oil contract for EUR 1.1 million and the fair

31.12.2008(EUR ‘000)

IAs 39 category

Carrying amount

Amorti-zed cost

Cost Fair value recognized

in equity


in profit and loss(impair-ments)/

reversals


in profit and loss –

other(expenses)/

income

Financial income/

(expenses)

Recogni-zed in Bs according to IAs 39

Fair value

Financial assets

Trade receivables Loans and receivables

74 820 83 701 0 0 -1 535 0 0 0 74 820

Other LT & ST receivables


106 709 106 709 0 0 2 415 0 0 0 106 709


Available for sale

2 420 0 1 867 66 -3 641 0 0 0 2 420


FVPL2 743 0 0 0 -2 257 0 0 0 743

Cash and cash equivalents


53 943 53 943 0 0 0 0 2 977 0 53 943


Cash Flow hedge

2 011 0 0 689 0 1 234 0 0 2 011

Derivatives-other FVPL1 264 0 0 0 0 -308 0 0 264


Bank borrowings FLAC 9 856 9 856 0 0 0 0 -1 002 0 9 856

Financial leases FLAC 8 902 0 0 0 0 0 -635 8 902 8 902

Other interest-bearing liabilities

FLAC 6 458 0 6 458 0 0 0 -308 0 6 458

Trade payables FLAC 71 518 0 71 518 0 0 0 0 0 71 518


Cash Flow hedge

891 0 0 0 0 0 0 0 891

Derivatives-other FVPL1 1 607 0 0 0 0 - 1 724 0 0 1 607

Other LT & ST payables

FLAC 159 082 0 159 082 0 0 0 0 0 159 082

FLAC: Financial liabilities measured at amortized cost.FVPL1: Fair value through profit and loss, held for trading.FVPL2: Fair value through profit and loss, derivative-based asset whose value could not be separated from the underlying notional value.



The fair value of these derivatives is determined by commonly used valuation techniques. These are based on market inputs from reliable financial information providers. Fair values are based on the trade dates of the underlying transactions.

2.3.1 Cash flow hedgeAt December 31, 2008, the Group held 20 forward exchange contracts and 12 currency options contracts designated as hedges of

expected future USD payments from customers. In comparison, at December 31, 2007, it held 16 forward exchange contracts and no currency options contracts for this purpose.

These hedges were assessed to be highly effective per IAS 39. They generated a loss of EUR 1.1 million in 2008, compared to a loss of EUR 1.6 million in 2007. This loss is charged directly to equity.

(‘000) December 31, 2008 December 31, 2007

less than 1 year

Between 1 and 2 years

more than 2 years

less than 1 year

Between 1 and 2 years

more than 2 years

Foreign currency hedges

Forward exchange contracts (USD/EUR)

$39 987 $35 328 $12 807 $30 875 $42 689 $4 007

Forward exchange contracts (GBP/USD)

£314 £0 £0 £0 £0 £0

Foreign currency options $7 560 $0 $0 $15 931 $0 $0

Interest rate hedges

Interest rate swaps $7 935 $565 $0 $1 935 $7 935 $399

other

Oil futures 624 000 gallons

58 000 gallons

Hedge-accounted forward exchange contracts and options

(EUR ‘000) Hedge-instrument maturity

Equity < 1 year 1-2 years > 2 years

At December 31, 2007

Cash flow hedge (USD) 1 801 881 920 0

At December 31, 2008

Cash flow hedge (USD) 689 509 -486 665

value of interest rate swaps for EUR 0.4 million.

At December 31, 2007, “Other LT & ST receivables” and “Other LT & ST payables” included down payments of EUR 15.5 million on proton therapy contracts for which the corresponding receivable amounts did not qualify for derecognition under IAS 39.At December 31, 2008, these down payments stood at EUR 29.1 million.

The Group may acquire and sell (non-controlling) minority interests in outside companies, as dictated by its business strategy. These investments are considered “Available for sale.”

2.3 Hedging activitiesThe following table provides an overview of the derivative financial instruments outstanding at December 31, 2008 and December 31, 2007, by maturity bucket.


The amount included in equity at December 31, 2007 and transferred to the income statement in 2008 is EUR 1.2 million.

2.3.2. Fair value through income statement—Held for tradingAt December 31, 2008, the Group held two interest rate swap agreements with notional amounts of USD 6 million and USD 2.5 million, respectively. Under the first swap, the Company received a variable interest rate of 2.04 percent at December 31, 2008 and paid a rate of 5.75 percent. Under the second swap, the Group received an average variable interest rate of 2.90 percent at December 31, 2008 and paid an estimated average rate of 5.52 percent.

Through its U.S. radiopharmaceutical distribution business, the Group has some exposure to fluctuations in the price of gasoline. To manage this risk, the Group entered into a number of futures contracts involving a notional of 624 000 gallons at December 31, 2008.

At December 31, 2008, the Group also held U.S. dollar and British pound currency forward exchange contracts, as well as options on a notional USD 9.3 million, GBP 0.3 million, and USD 4.8 million to cover cash flows in these currencies.

As they do not qualify for hedge accounting under IAS 39, the various hedge instruments in this section are measured at fair value through profit and loss. The loss generated on these hedging instruments totaled EUR 2.1 million at December 31, 2008, compared with a gain of EUR 0.5 million at December 31, 2007.

2 .4 Capital management The Group is continuously optimizing its capital structure to maximize shareholder value while keeping the financial flexibility desirable to execute strategic projects. In 2008, IBA Investments SCRL, a second-tier subsidiary of IBA S.A., initiated an IBA S.A. stock purchase program of EUR 0.8 million (EUR 6.5 million in 2007).

The Board of Directors has decided to ask the shareholders to approve payment of a dividend

of EUR 0.08 per share at the Ordinary General Meeting of May 13, 2009.

The Ordinary General Meeting of May 14, 2008 approved payment of a dividend of EUR 0.17 per share.



3. Critical accounting estimates and judgments

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

(a) Income taxesThe Group had accumulated net operating losses usable to offset future taxable profits, essentially in Belgium, France, Italy, Spain, the United Kingdom, and the United States, amounting to EUR 149.6 million at December 31, 2008. It recognized deferred tax assets of EUR 31,8 million for permanent differences and EUR 2.2 million for temporary differences.

The valuation of these assets depends on a number of judgmental assumptions regarding the future probable taxable profits of different Group subsidiaries in different jurisdictions. These estimates are established prudently on the basis of the most recent information available to the Company. If circumstances change and the final tax outcome is different from that amounts initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.

In order to mitigate this risk, and given the rapid evolution of the technological environment in which the Group operates, estimated taxable profits beyond a horizon of four years are not considered.

(b) Provisions for decommissioning costsThe production of FDG (Pharmaceutical business segment) generates radiation and results in the contamination of production site facilities. This situation may require the Group to pay restoration costs to comply with regulations in these various jurisdictions, as well as with any legal or constructive obligations.

Analysis and estimates are performed by the

Group, together with its legal advisers, in order to determine the probability, timing, and amount involved in a probable required outflow of resources.

Provisions have been made, when required by local regulations, to cover costs in connection with decommissioning the sites where radiopharmaceutical agents are produced. These provisions are measured at the net present value of the best estimate of the necessary costs.

At December 31, 2007, provisions for the cost of decommissioning sites in Belgium and the United States amounted to EUR 2.8 million. At December 31, 2008, these provisions totaled EUR 34.7 million and were primarily for obligations in connection with a radiopharmaceutical production facility belonging to the Group’s French subsidiary, CIS Bio International S.A.S.

Note that in December 2008 the French subsidiary CIS Bio International S.A.S. obtained nuclear operator status, which makes it mandatory to set aside restricted assets for the future decommissioning and restoration of the nuclear medicine facilities at the site in Saclay, France. At December 31, 2008, these restricted assets stood at EUR 28.5 million. In the U.S., approximately EUR 1.4 million has been deposited in blocked accounts in order to meet legal obligations in certain States (Illinois and California).

(c) Provisions for obligation to take over radioactive equipment and sourcesIn the context of the gradual disengagement from radioactive source production (production of cobalt and cesium) at the site in Saclay, France, a provision has been made to meet obligations for the takeover and disposal of used radioactive sources and certain equipment (irradiators) on French territory. This provision is valued at the net present value of the most probable estimates of unavoidable costs for the treatment and disposal of these used sources. This provision is discounted



based on the estimated plan for source recovery.

At December 31, 2008, this provision stood at EUR 18.9 million.

(d) Revenue recognitionContracts in progress are valued at their cost of production, increased by income accrued as determined by the stage of completion of the contract activity at the balance sheet date, to the extent that it is probable that the economic benefits associated with the contract will flow to the Group. This probability is based on judgment. If certain judgmental criteria differ from those used for previously recognized revenues, the Group’s income statement is affected.

When appropriate, the Company revises its estimated margin at completion to take into account the assessment of any residual risk arising from this contract over several years. When the final outcome of these uncertainties differs from initial estimations, the Group’s income statement is affected.

(e) Provisions for defined benefit plansIBA records provisions for the defined benefit plans of its subsidiary CIS Bio International S.A.S. These benefits are valued in accordance with IAS 19. The following assumptions were made in calculating these provisions at December 31, 2008:Discount rate: 5.2%Mortality table: TH-TF 00-02Inflation rate: 2%Salary adjustment rate: 2.5% per annumPension adjustment rate: 1%, excluding inflationRetirement age: 63 for management, 60 for non-management In accordance with IAS 19, additional information is provided in Note 27.2.

(f) Estimating the value in use of intangible and tangible fixed assetsThe recoverable amounts of tangible and intangible fixed assets are determined on a “value in use” basis. Value in use is determined on the basis of IBA’s most recent business plans, as approved by the Board of Directors. These

plans incorporate various assumptions made by management and approved by the Board as to how the business, profit margins, and investments will evolve. In accordance with IAS 36, additional information is provided in Note 7.1.

(g) valuation of private equity instrumentsIBA revalues its private equity holdings using either the discounted cash flow method or the share value assigned to them during the most recent rounds of financing. Note that, at December 31, 2008, IBA had recorded a decline in value of EUR 3.6 million for one private equity investment due to a downward revision of estimated gains from the use of an innovative technology.


4. segment information

On the basis of its internal financial reports to the Board of Directors and given the Group’s primary source of risk and profitability, IBA has identified two reporting segments.Business segments are used for its primary segment reporting format.Geographical segments are used for its secondary segment reporting format.

4.1 Business segmentsAt December 31, 2008, the Group had two primary business segments for reporting purposes: (1) Equipments and (2) Pharmaceuticals.Equipments. This segment constitutes the technological basis of the Group’s many businesses and encompasses development, fabrication, and services associated with medical and industrial particle accelerators, proton therapy systems, and a wide range of dosimetry products and radiation therapy solutions.Pharmaceuticals. This segment encompasses

radiopharmaceuticals (production and distribution) and bioassays:• Radiopharmaceuticals. IBA is active in the

area of positron emission tomography (PET), where it produces and distributes primarily fluorodeoxyglucose (FDG), a chemical compound used in molecular imaging for the diagnosis of many diseases (principally cancer). IBA also has a presence in the field of single photon emission computed tomography (SPECT).

• Bioassays. IBA produces and distributions a line of biomarkers used for in vitro medical diagnosis. The Group’s HTRF® technology also gives it a presence in the in vitro screening of new drugs for the pharmaceutical industry and biotech companies.

The table below provides details of the income statement for each segment. Any inter-segment sales are contracted at arm’s length.

year ended December 31, 2008(EUR ‘000)

Equipments Pharmaceuticals Group

Sales and services 184 276 150 900 335 176

Inter-segment sales -1 640 -929 -2 569

External sales 182 636 149 971 332 607

segment result 7 965 14 963 22 928

Unallocated expenses -5 818

Financial (expenses)/income -2 637

Share of profit/(loss) of companies consolidated using the equity method 0 -2 363 -2 363

Result before tax 12 110

Tax expense -6 781

REsUlt FoR tHE PERIoD 5 329

Segment assets 199 979 273 567 473 546

Equity-accounted investments allocated to a segment 3 643 3 643

Unallocated assets 32 332

totAl AssEts 199 979 277 210 509 521

Segment liabilities 161 100 195 846 356 946

Unallocated liabilities 209

totAl lIABIlItIEs 161 100 195 846 357 155

otHER sEGmEnt InFoRmAtIon

Capital expenditure (incl. fixed assets in companies acquired in 2008) 4 453 18 512

Depreciation and impairment of property, plant, and equipment 1 816 10 770

Amortization of intangible assets 809 2 595

Non-cash expenses/(income) 291 -940

Headcount at year-end 973 1 159


4.2 Geographical segmentsThe Group’s business segments operate in two main geographical areas, the United States and the rest of the world (R.O.W.).

These geographical segments have been determined on the basis of economic and political context, the degree of proximity of the business activities, and the specific risks associated with the business activities in a given geographical area.

The sales figures presented below are based on customer location, whereas segment balance sheet items are based on asset location.

Sales between segments are made on the same terms and conditions as sales to outside companies.



Equipments Pharmaceuticals Group

Sales and services 136 581 78 265 214 846

Inter-segment sales -997 -997

External sales 136 581 77 268 213 849

segment result 11 091 -578 10 513

Unallocated expenses -3 472

Financial (expenses)/income -456

Share of profit/(loss) of companies consolidated using the equity method 278 278

Result before tax 6 863

Tax income 6 983

REsUlt FoR tHE PERIoD 13 846

Segment assets 160 721 124 084 284 805

Equity-accounted investments allocated to a segment 13 6 025 6 038


totAl AssEts 160 734 130 109 324 438

Segment liabilities 130 909 51 986 182 895

Unallocated liabilities 62


otHER sEGmEnt InFoRmAtIon

Capital expenditure (incl. fixed assets in companies acquired in 2007) 4 993 21 678

Depreciation and impairment of tangible fixed assets 1 334 4 421

Amortization of intangible assets 718 836

Other non-cash expenses -2 593 3 298

Headcount at year-end 724 655


UsA R.o.W. Group

sales 133 369 199 238 332 607

Segment assets 92 310 381 493 473 803



totAl AssEts 509 521

Capital expenditure (incl. fixed assets from acquisitions in 2008) 8 516 14 449


5. lists of subsidiaries and equity-accounted investments

At December 31, 2008, the IBA Group consisted of IBA S.A. and a total of 37 companies and associates in 13 countries. Of these, 32 are fully consolidated and 6 are accounted for using the equity method. The Group has elected not to use the proportional method for any of the joint companies.

5.1 list of subsidiariesname Country of

incorporationshare of equity

held (%)Change in % held compared

to December 31, 2007

IBA RadioIsotopes S.A. (BE 0466.749.548) Belgium 99.73% 4.73%

IBA Molecular Holding (BE 0880.070.706) Belgium 100% -

IBA Pharma S.A. (BE 0860.215.596) Belgium 100% -

IBA Pharma Invest S.A. (BE 0874.830.726) Belgium 61.9% -

IBA Participations S.P.R.L. (BE 0465.843.290) Belgium 100% -

IBA Investments S.C.R.L. (BE 0471.701.397) Belgium 100% -

IBA Corporate Services S.A. (BE 0471.889.261) Belgium 100% -

Ion Beam Beijing Medical Appliance Technology Service Co. Ltd. China 100% -

Ion Beam Applications Co. Ltd. China 100% -

IBA RadioIsotopes France S.A.S. France 100% -

IBA Dosimetry Gmbh Germany 100% -

IBA Molecular Imaging (India) Pvt. Ltd. India 61.9% -

IBA RadioIsotopi Italia S.r.L. Italy 100% -

IBA Molecular Spain S.A. Spain 100% -

MediFlash Holding A.B. Sweden 100% -

IBA Dosimetry A.B. Sweden 100% -

IBA Advanced Radiotherapy A.B. (previously Gyrab International A.B.)

Sweden 100% -

IBA Molecular UK limited United Kingdom 100% -

IBA Dosimetry North America Inc. USA 100% -

IBA Proton Therapy Inc. USA 100% -

IBA Industrial Inc. USA 100% -

IBA Molecular North America Inc. USA 100% -

RadioMed Corporation USA 100% -

IBA USA Inc. USA 100% -

IBA Molecular Montreal Holding Corp. USA 100% -

BetaPlus Pharma S.A. (BE 0479.037.569) Belgium 75% -

IBA Particle Therapy Gmbh Germany 100% 100%

Radiopharma Partners S.A. (BE 0879.656.475) Belgium 100% 80.1%

CIS Bio International S.A.S.1 France 100% 80.1%

Cis Bio Spa Italy 100% 80.1%

Cis Bio Gmbh Germany 100% 80.1%

Cis Bio US Inc. USA 100% 80.1%

(1) On August 31, 2008 CIS Bio International France S.A.S. absorbed its subsidiary Positron Paris Nord S.A.S.


UsA R.o.W. Group

sales 117 905 95 945 213 849

Segment assets 81 502 206 049 287 551



totAl AssEts 324 438

Capital expenditure (incl. fixed assets from acquisitions in 2007) 4 595 22 076


6. Business combinations and other changes in the composi-tion of the Group

5.2 list of equity-accounted investments

6.1 Acquisition of companiesOn May 5, 2006, IBA and IRE (Institut National des Radioéléments, a related party holding 5.36 percent of IBA shares at December 31, 2008) announced that they had signed a sales agreement with Schering AG giving them 100 percent ownership of the French company CIS Bio International S.A.S. and its subsidiaries. This purchase was carried out by Radiopharma Partners S.A., in which IBA and IRE held ownership interests of 19.9 percent and 80.1 percent, respectively.In 2006, IBA had also obtained a call option from IRE on 15 percent of Radiopharma Partners S.A.In 2007, IBA and IRE signed an agreement giving IBA a call option on all shares of Radiopharma Partners S.A. not already in its possession (i.e. 80.1 percent), as well as on an additional participation of 19.9 percent of the Japanese firm Sceti Medical Labo KK. This agreement was valid until June 30, 2008.

On May 19, 2008, IBA exercised its call option on 80.1 percent of Radiopharma Partners S.A. and 19.9 percent of Sceti Medical Labo KK.The sale took place on May 31, 2008. CIS Bio International S.A.S. and its subsidiaries were brought into the scope of consolidation of the IBA Group as of that date. This means that seven months of results from CIS Bio International S.A.S. and its subsidiaries are shown on a full consolidation basis in the Group’s 2008 financial statements. The first five months of these entities’

operations are shown on an equity-accounted basis in the consolidated statements. As a result of the above transaction of May 31, 2008, IBA holds a 39.8 percent stake in Sceti Medical Labo KK and accounts for its investment in this entity on an equity basis.

IBA has recorded the identifiable assets, liabilities, and contingent liabilities of CIS Bio International S.A.S. and its subsidiaries at fair value at the date of acquisition.


name Country of incorporation

share of equity held (%)

Change in % held compared to De-cember 31, 2007

Striba Gmbh Germany 50% -

Pharmalogic Pet Services of Montreal Cie Canada 48% -

PetLinq L.L.C. USA 40% -

Radio Isotope Méditerranée Morocco 25% 25%

Molypharma Spain 24.5% -

Sceti Medical Labo KK Japan 39.8% 19.9%


(EUR ‘000) Fair value Carrying value of net acquired assets

Cash and cash equivalents 66 617 66 617

Trade and other short-term receivables 45 221 45 221

Inventories 23 643 16 528

Property, plant, and equipment 18 098 16 615

Intangible assets 28 859 23 398

Investments accounted for using the equity method 133 133

Other long-term receivables 10 362 3 194

Trade and other short-term payables -69 549 -69 549

Provisions -87 749 -87 749

Borrowings -9 626 -9 626

Other long-term payables -83 -83

net acquired assets 25 926 4 699

(yEn ‘000) Fair value Carrying value of net acquired assets

Cash and cash equivalents 16 211 16 211

Trade receivables 23 374 23 374

Inventories 5 895 5 895


Other non-current assets 64 64

Trade payables -30 558 -30 558

Borrowings -72 000 -72 000

Net acquired assets (JPY ‘000) 8 414 8 414

Net acquired assets (EUR ‘000) 51 51

Price paid (EUR ‘000) 723

- Cash 0

- Cancellation of payables to seller 723

Fair value of net acquired assets (EUR ‘000) 51

Goodwill (EUR ‘000) 672

(EUR ‘000)

Price paid (EUR ‘000) 22 178

- Cash 18 736

- Value of call option for 15% of shares 2 784

- Direct acquisition-related expenses 658

Fair value of net acquired assets (80.1%) 20 767

Goodwill (EUR ‘000) 1 412

The following assets and liabilities of CIS Bio International S.A.S. and its subsidiaries were included in the consolidated accounts:

Goodwill arising from the inclusion of CIS Bio International S.A.S. and its subsidiaries in the scope of consolidation of the IBA Group is presented as follows:

At December 31, 2008, the contribution of CIS Bio International S.A.S. to Group REBIT was EUR 1.2 million. Its contribution to net profit or loss from continuing operations was EUR 10.4 million. If CIS Bio International S.A.S. had been acquired on January 1, 2008, at year-end the Group’s net result would have been minus EUR 6.3 million, and sales and services would have been EUR 381.7 million.

Goodwill and net acquired assets from the purchase of IRE (Institut National des Radioéléments) and 19.9 percent of Sceti Medical Labo KK are presented as follows:


(EUR ‘000) Fair value Carrying value of net acquired assets

Cash and cash equivalents 150 150

Trade receivables 672 672


Intangible assets 528 528

Investments accounted for using the equity method 0 0

Other net assets/(liabilities) 303 303

Trade payables -753 -753

Provisions -43 -43

Borrowings -5 027 -5 027

net acquired assets 550 550

6.2 Disposal of companiesNo companies were sold in fiscal years 2007 and 2008.


(million EUR)

Price paid 1.5

- Cash 0.1

- Deferred payment

- Net contribution in kind 1.4

- Direct acquisition-related expenses

Fair value of net acquired assets 0.5

Goodwill 1.0

On December 20, 2007, IBA transferred its FDG production facility at University Hospital Ghent, Belgium, to BetaPlus Pharma S.A. for EUR 2.4 million as a contribution-in-kind. In return for this contribution, IBA received 1 000 new shares in BetaPlus Pharma S.A. and receivables of EUR 1 million. As a result of this transaction, IBA’s stake in BetaPlus Pharma S.A. increased from 40 percent to 65 percent, automatically bringing this entity within the Group’s scope of consolidation. IBA also paid EUR 0.1 million in cash to acquire 10 percent of BetaPlus Pharma S.A.

BetaPlus Pharma S.A. was included in the Group’s consolidated financial statements at December 31, 2007. No gain or losses from BetaPlus Pharma S.A. were integrated on a full consolidation basis into the group results.

Goodwill arising from inclusion of BetaPlus Pharma S.A. in the scope of consolidation of the IBA Group was presented as follows:

The following assets and liabilities of BetaPlus Pharma S.A. were included in the consolidated statements at December 31, 2007:


(EUR ‘000) Equipments Pharmaceuticals Group

December 31, 2008 3 548 25 214 28 762

December 31, 2007 3 741 22 797 26 538

Post-tax discount rate applied, 2008 9.00 % 9.20 %

Long-term growth rate, 2008 2.60 % 2.60 %

Post-tax discount rate applied, 2007 9.50% 10.882%

Long-term growth rate, 2007 2.60% 2.60%

Goodwill that arose in connection with an acquisition is allocated to the cash-generating units (CGUs) concerned, and an impairment test is carried out annually on the CGUs’ fixed assets (including goodwill).

Inclusion of BetaPlus Pharma S.A. in the Group’s scope of consolidation at December 31, 2007 gave rise to goodwill in the amount of EUR 1.0 million.In 2008, inclusion of CIS Bio International S.A.S. and its subsidiaries resulted in the recognition of goodwill of EUR 1.4 millionGoodwill from the acquisition of 19.9 percent

of Sceti Medical Labo KK on May 31, 2008 is included in the value of the equity-accounted investment.

Additions to goodwill in 2007 and 2008 were allocated to the Pharmaceuticals business segment.

The following table summarizes allocation of the carrying amount of goodwill by business segment:

The recoverable amounts of subsidiaries’ fixed assets have been determined on a “value in use” basis. Value in use has been determined on the basis of IBA’s latest business plans, as approved by the Board of Directors in the context of the five-year strategic plan. The cash flows beyond the four-year period have been extrapolated using the growth rates shown in the table above. Impairment

testing uses gross budgeted operational margins estimated by management on the basis of past performance and future development prospects. Discount rates used reflect the specific risks related to the segments in question.

No impairment was identified in 2007 and 2008.

7. Goodwill and other intangible assets

7.1 GoodwillMovements of goodwill are detailed as follows:

(EUR ‘000)

At January 1, 2007 28 100

Final adjustments to previously acquired goodwill 0

Additions through business combinations 1 006

Goodwill impairment 0

Currency translation difference -2 568

At December 31, 2007 26 538

At January 1, 2008 26 538

Final adjustments to previously acquired goodwill 0

Additions through business combinations 1 412

Goodwill impairment 0

Currency translation difference 812

At December 31, 2008 28 762


7.2 other intangible assets

The majority of the intangible assets involve software, licenses for the production and distribution of radiopharmaceutical agents, exclusive distribution rights, and customer lists, accounted for by applying the “purchase method” to acquisitions made by the Group.The remaining intangible assets have to do primarily with the value of customer relationships, which are amortized over the anticipated life of these relationships.

Amortization expense for intangible assets was recognized in the income statement in the line items “Cost of sales and services,” “Sales and marketing expenses,» General and administrative expenses,” and “Research and development expenses.”

For details on impairment testing, see Note 7.1.

No impairment of intangible assets (as described in this Note) was identified at December 31, 2007 or December 31, 2008.


(EUR ‘000) software Patents and trademarks

Development costs

other total

Gross carrying amount at January 1, 2007 3 564 1 395 965 4 509 10 433

Additions 897 380 99 728 2 104

Disposals -229 0 0 0 -229

Transfers 93 0 0 46 139

Changes in consolidation scope 7 42 0 8 57

Currency translation difference -60 -10 -49 -245 -364

Gross carrying amount at December 31, 2007 4 272 1 807 1 015 5 046 12 140

Accumulated amortization at January 1, 2007 2 491 942 363 2 522 6 318

Additions 535 332 258 429 1 554

Disposals -223 0 0 -6 -229

Transfers 70 10 0 -79 1


Currency translation difference -31 -11 -17 -74 -133

Accumulated amortization at December 31, 2007 2 842 1 275 604 2 800 7 521

net carrying amount at January 1, 2007 1 073 453 603 1 987 4 115

net carrying amount at December 31, 2007 1 430 532 411 2 246 4 619

Gross carrying amount at January 1, 2008 4 272 1 807 1 015 5 046 12 140

Additions 1 101 4 306 257 378 6 042

Disposals -66 -64 -41 -57 -228

Transfers 32 -124 238 1 143 1 289

Changes in consolidation scope 3 147 15 435 0 38 584 57 166

Currency translation difference 128 7 -11 154 278


Accumulated amortization at January 1, 2008 2 842 1 275 604 2 800 7 521

Additions 906 307 198 1 993 3 404

Disposals -4 -64 -41 -57 -166

Transfers -58 0 0 52 -6

Changes in consolidation scope 2 887 10 232 0 14 861 27 980

Currency translation difference 42 3 11 130 186

Accumulated amortization at December 31, 2008 6 615 11 753 772 19 779 38 919

net carrying amount at January 1, 2008 1 430 532 411 2 246 4 619

net carrying amount at December 31, 2008 1 999 9 614 686 25 469 37 768


8. Property, plant, and equipment

(EUR ‘000) land and buildings

Plant, ma-chinery, and

equipment

Furniture, fixtures, and

vehicles

other proper-ty, plant, and

equipment

total


Additions 2 916 3 734 2 859 12 159 21 668

Disposals -27 -1 443 -1 564 -255 -3 289

Disposals through business combinations 0 13 -2 0 11

Transfers 45 1 524 -1 476 -1 133 -1 040

Changes in consolidation scope 0 2 563 49 136 2 748

Currency translation difference -1 149 -3 688 -594 -1 498 -6 929


Accumulated depreciation at January 1, 2007 10 716 30 438 9 157 -5 50 306

Additions 1 113 2 999 1 643 0 5 755

Disposals -15 -1 409 -1 543 0 - 2 967

Disposals through business combinations 1 9 0 0 10

Transfers 0 -241 241 0 0


Currency translation difference -649 -2 143 -461 5 -3 248

Accumulated depreciation at December 31, 2007 11 166 29 874 9 059 0 50 099

net carrying amount at January 1, 2007 8 964 19 722 4 051 13 677 46 414

net carrying amount at December 31, 2007 10 299 22 989 3 422 23 082 59 792


Additions 1 153 4 346 2 121 11 052 18 672

Disposals -69 -5 597 -1 257 -29 -6 952

Transfers 9 072 13 090 2 123 -25 579 - 1 294

Changes in consolidation scope 55 347 62 215 3 556 56 764 177 882

Currency translation difference -1 794 1 443 -440 -8 -799


Accumulated depreciation at January 1, 2008 11 166 29 874 9 059 0 50 099

Additions 1 420 9 888 2 218 -940 12 586

Disposals -48 -3 780 -1 195 0 -5 023

Transfers 17 -9 -1 0 7

Changes in consolidation scope 48 589 52 660 3 255 55 278 159 782

Currency translation difference 232 863 161 0 1 256

Accumulated depreciation at December 31, 2008 61 376 89 496 13 497 54 338 218 707

net carrying amount at January 1, 2008 10 299 22 989 3 422 23 082 59 792

net carrying amount at December 31, 2008 23 798 38 864 5 087 10 944 78 693

Other tangible fixed assets mainly include assets under construction. There are no tangible fixed assets subject to title restrictions. Depreciation expense for intangible assets was recognized in profit and loss in the line items “Cost of sales and services”, “Sales and marketing expenses”, “General and administrative expenses”, “Research and development expenses”, and “Other operating expenses.”

As indicated in Note 7.1, an impairment test was carried out in respect of the non-current assets at December 31, 2007 and December 31, 2008 to verify that the carrying amounts of tangible fixed assets, intangible assets, and goodwill were justified by the recoverable amounts. The key assumptions used to calculate value in use are indicated in Note 7.1. No impairment was recognized in 2007 and 2008.


9. lease arrangements

10. Investments accounted for using the equity method and other investments

IBA holds the following assets under financial lease contracts:

Details of lease payments on finance liabilities relating to leased assets are set out in Note 18.2.

“Other investments” consist of shares in unlisted companies (private equity investments). These shares are revalued using either the discounted cash flow method or on the basis of the share value assigned to them during the most recent rounds of financing.


(EUR ‘000) land and buildings Plant, machinery, and equipment

Furniture, fixtures, and vehicles

12/31/2008 12/31/2007 12/31/2008 12/31/2007 12/31/2008 12/31/2007

Gross carrying value 7 325 5 614 26 236 20 248 41 12

Accumulated depreciation 3 628 1 747 14 037 10 443 10 0

net carrying value 3 697 3 867 12 199 9 805 31 12

(EUR ‘000) December 31, 2008 December 31, 2007

Investments accounted for using the equity method 3 643 6 038

Other investments 2 420 2 343

totAl 6 063 8 381

10.1 movements in equity-accounted investments Equity-accounted companies are listed in Note 5.2.

On May 31, 2008, IBA purchased from IRE (Institut National des Radioéléments, a related party holding a 5.36 percent interest ownership in IBA at December 31, 2008), an additional interest ownership of 19.9 percent in the Japanese firm Sceti Medical Labo KK, bringing its total ownership of that company to 39.8 percent.As a result of the Group’s May 31, 2008 acquisition of the 80.1 percent of Radiopharma Partners S.A. that it did not already owned, CIS Bio International S.A.S. and its subsidiaries have been fully consolidated with the IBA Group since that time. The impact of these two transactions is included in “Other movements.”

In December 2007, IBA transferred its FDG production facility at University Hospital Ghent, Belgium, to BetaPlus Pharma S.A. for EUR 2.4 million as a contribution-in-kind. In return for this contribution, IBA received 1 000 new shares in BetaPlus Pharma S.A. and receivables of EUR 1 million. Following this transaction, IBA’s stake in BetaPlus Pharma S.A. increased from 40 percent to 65 percent, automatically bringing this entity within the IBA Group’s scope of consolidation. IBA also paid EUR 0.1 million in cash for 10 percent of BetaPlus Pharma S.A.


At January 1 6 038 5 744

Share in (loss)/profit of equity-account companies -2 363 278

Additions 0 0

Other movements -32 16

At December 31 3 643 6 038


(EUR ‘000) Country of incorporation

Assets liabilities Revenue Profit/(loss) % Interest

(EUR ‘000) (EUR ‘000) (EUR ‘000) (EUR ‘000)

2007

molyPharma Spain 9 195 5 463 9 138 -443 24.5%

CIs Bio International (indirectly via Radiopharma Partners)

France 172 972 158 813 119 200 1 277 19.9%

Radiopharma Partners Belgium 46 3 0 -2 19.9%

Pharmalogic Pet services of montreal Cie.

Canada 3 355 3 027 3 391 184 48.0%

Petlinq llC USA 335 227 754 -14 40.0%

striba Gmbh Germany 48 794 48 775 24 -3 50.0%

2008

molyPharma Spain 10 174 5 952 10 686 574 24.5%

Pharmalogic Pet services of montreal Cie.

Canada 2 956 2 626 4 111 100 48.0%

Petlinq l.l.C. USA 306 680 1 276 -355 40.0%

Radio Isotope méditerra-née

Morocco 5 374 4 342 0 -145 25.0%

striba Gmbh Germany 80 368 80 348 849 1 50.0%

sceti medilabo KK1 Japan 4 571 4 330 1 332 -79 39.8%

(1) Fiscal year ends September 30. Figures are at December 31, 2008 (three months of operations).

10.2 Jointly controlled companiesIn 2006, IBA formed a joint venture named Striba GmbH with Strabag Projektenwicklung GmbH (Germany). This joint-venture will provide a proton therapy system and related medical technology to the Universitätsklinikum Essen (North-Rhine, Westphalia, Germany).The assets and liabilities of these joint ventures (consolidated using the equity method) are detailed below.


Assets

Non-current assets 0 0

Current assets 80 368 48 794

totAl 80 368 48 794

liabilities

Non-current liabilities 0 0

Current liabilities 80 348 48 775

totAl 80 348 48 775

net assets 20 19

Revenue 849 24

Expense/(income) 848 27

Result after tax 1 -3

Details of the Group’s interest in its principal associates, all of which are unlisted, are presented as follows:


11. Deferred taxes



Deferred tax assets

- Deferred tax asset to be recovered after more than 12 months 28 682 26 160

- Deferred tax asset to be recovered within 12 months 5 304 7 152

totAl 33 986 33 312

Deferred tax liabilities

- Deferred tax liabilities to be paid after more than 12 months 286 259

- Deferred tax liabilities to be paid within 12 months 184 110

totAl 470 369

net deferred tax assets 33 516 32 942

Deferred tax assets(EUR ‘000)

tax losses other totAl

(EUR '000) (EUR '000) (EUR '000)

At January 1, 2007 26 935 -1 957 24 978

(Credited)/charged to the income statement 9 428 9 428

Currency translation difference -1 094 -1 094

At December 31, 2007 35 269 -1 957 33 312

(Credited)/charged to the income statement -6 552 - 6 552

Acquisition of companies 7 063 7 063

Currency translation difference 163 163

At December 31, 2008 35 943 -1 957 33 986

Deferred income tax assets are recognized to the extent that it is likely they can be recovered through future earnings. Note 3 explains the estimates and judgments used by IBA in making this assessment.

At December 31, 2008, deferred taxes totaling EUR 19.7 million (EUR 33.8 million in 2007) were not recognized as assets on the balance sheet. The related tax losses do not have an expiration date.

Deferred tax liabilities(EUR ‘000)

other total

At January 1, 2007 225 225

Credited/(charged) to the income statement 144 144


At December 31, 2007 369 369

Credited/(charged) to the income statement 17 17

Acquisition of companies 84 84


At December 31, 2008 470 470


Following the sale of two machines in inventory, in 2007 the Group reversed write-downs of EUR 3.2 million previously recorded for these equipments.

Work in progress relates to production of inventory for which a customer has not yet been secured, while contracts in progress relate to production for specific customers in performance of a signed contract.

In December 2008, the French subsidiary CIS Bio International S.A.S. obtained nuclear operator status, which made it mandatory to set aside restricted assets for the future decommissioning and restoration of the nuclear medicine facilities at the site in Saclay, France. At December 31, 2008, these assets, included in “Long-term receivables for decommissioning of sites,” totaled EUR 28.5 million. This caption also includes deposits of EUR 1.4 million held in blocked accounts in the U.S. in order to meet legal obligations in certain States (Illinois and California).

Long-term liabilities arising from contracts in progress include down payments of

EUR 29.1 million (EUR 15.5 million in December 2007) on proton therapy contracts for which the corresponding receivable amounts do not qualify for derecognition under IAS 39.

At December 31, 2007, “Other assets” included EUR 1.4 million for the fair value of an option to increase percentage ownership in CIS Bio International S.A.S. At December 31, 2008, “Other assets” consisted primarily of receivables of EUR 3.0 million with associates and of investments in structured products with repayment horizons of more than 12 months.

12. other long-term assets

13. Inventories and contracts in progress


Long-term receivables on contracts in progress 29 097 15 545

Receivables on disposal of subsidiaries 81 143

Long-term receivables for decommissioning of sites 29 943 0

Other assets 5 990 2 953

totAl 65 111 18 641


Raw materials and supplies 27 278 11 955

Finished products 8 568 2 265

Work in progress 24 032 5 895

Contracts in progress 31 882 22 267

Write-off on inventories and contracts in progress -6 001 -1 483

Inventories and contracts in progress 85 759 40 899

Contracts in progress(EUR ‘000)


Costs to date and recognized profit 160 490 94 481

Less: progress billings -128 608 -72 214

Contracts in progress 31 882 22 267

Net amounts due to customers for contracts in progress (Note 23) 26 759 31 984


At December 31, 2008, receivables of EUR 4.4 million were given as collateral (EUR 5.7 million in 2007).

At December 31, the repayment schedule for trade receivables (excluding impairments) was as follows:

14.1 trade receivablesTrade accounts receivable can be broken down as follows:

14. trade and other receivables



Amounts invoiced to customers on contracts in progress but for which payment has not yet been received at balance sheet date

1 580 11 438

Other trade receivables 82 121 35 433

Impairment of doubtful receivables (-) -8 881 -2 628

totAl 74 820 44 243

(EUR ‘000) totAl not due <30 days 30-59 60-89 90-179 180-269 270-360 > 1 year

2008 83 701 38 931 19 475 6 721 5 136 4 027 2 939 1 090 5 382

2007 46 871 15 566 9 677 8 654 3 291 3 873 2 407 1 330 2 073

14.2 other receivablesOther receivables on the balance sheet primarily involve advance payments on orders, deferred charges, and accrued income.

Other receivables can be broken down as follows:


Non-trade receivables and advance payments 31 877 21 297

Deferred charges 4 225 5 051

Accrued income–interest 770 83

Other current receivables 5 469 1 512

totAl 42 341 27 943

At December 31, 2008, trade receivable impairments totaled EUR 8.9 million. Changes in the provision for doubtful debts for the past two years are as follows:

(EUR ‘000)

At January 1, 2007 4 359

Charge for the year 1 207

Utilizations -603

Write-backs -2 335

At December 31, 2007 2 628

Entry in consolidation scope 5 456

Charge for the year 1 535

Utilizations 0

Write-backs -812

Currency translation difference 74

At December 31, 2008 8 881


At December 31, 2008, the effective interest rate on the cash position was 4.2 percent (3.76 percent in 2007).Short-term deposits and commercial paper have an average maturity of less than 30 days.

16.1 Capital stock

The Board of Directors approved a capital increase of EUR 9.4 million at its meeting of June 23, 2008. The articles of incorporation of the Group’s parent company were amended to reflect this decision on the same day.Because this capital increase was carried out in the context of purchasing IRE’s 80.1 percent interest in Radiopharma Partners S.A., the Director representing IRE (Institut National des Radioéléments) did not participate in the Board of Director’s decision of approving the increase.

At the Extraordinary General Meeting of May 9, 2007, the Group’s shareholders agreed to defray its loss through a reduction of capital surplus of EUR 87.4 million.

At December 31, 2008, free float represented 60.14 percent of IBA’s shares on Euronext. Full details of the Group’s shareholders are set out in the section “Shareholders and the Stock Exchange” on page 110 of this annual report.

On April 2, 2009, a dividend of EUR 2.2 million, equivalent to EUR 0.08 per share, was proposed by the Board of Directors. In accordance with IAS 10 Events After the Balance Sheet Date, the dividend was not recognized in the 2008 financial statements.

16.2 stock optionsDuring the period ended December 31, 2008, IBA had eight stock option plans, including a new plan instituted in 2008.

The stock option plans set up in 2000 and 2001 have the following vesting scheme: 25 percent vesting at grant date + 1 year, 50 percent at grant date + 2 years, 75 percent at grant date + 3 years, 100 percent at grant date + 4 years.

Stock option plans instituted from 2002 onwards have the following vesting scheme: 20 percent vesting at grant date + 1 year, 40 percent at grant date + 2 years, 60 percent at grant date + 3 years,

15. Cash and cash equivalents

16. Capital stock and stock options


Cash 24 290 44 488

Restricted cash 64 1 210

Short-term bank deposits and commercial paper 29 589 12 512

totAl 53 943 58 210

number of shares

ordinary shares

(EUR ‘000)

Capital surplus

(EUR ‘000)

treasury shares

(EUR ‘000)

total(EUR ‘000)

Balance at January 1, 2007 25 464 066 35 747 200 898 -256 236 389

Stock options exercised 335 186 468 1 736 2 204

Defrayment of loss by reduction of capital surplus

-87 435 -87 435

Purchase of treasury shares -6 490 -6 490

Balance at December 31, 2007 25 800 252 36 215 115 199 -6 746 144 668

Stock options exercised 218 234 306 523 829

Capital increase 544 611 764 8 636 9 400

Purchase of treasury shares -817 -817

Balance at December 31, 2008 26 563 097 37 285 124 358 -7 563 154 080



80 percent at grant date + 4 years, 100 percent at grant date + 5 years.

In 2005, the Group refunded a capital surplus of EUR 3.1 per share to its shareholders. Following this action, on March 13, 2006, IBA’s Board of Directors approved a reduction in the exercise price for IBA employee stock option plans instituted in 2000, 2001, 2002, and 2004. Under IFRS 2, this repricing qualifies as a modification of the terms

of the grants of the instruments in the 2000, 2001, 2002, and 2004 plans. A charge of EUR 2.4 million was recognized in the 2006 income statement to reflect this modification. This change had an impact EUR 0.6 million on the 2007 financial statements and EUR 0.2 million on the 2008 financial statements.

Details of the plans instituted in the course of 2008 and 2007 are given below.


Type of plan Stock option Stock option

Date of grant 30/11/2008 30/11/2007

Number of options granted 111 903 338 246

Exercise price 14.18 19.94

Share price at date of grant 8.74 19.94

Contractual life (years) 6 6

Settlement Shares Shares

Expected volatility 36.66% 39.02%

Expected option life at grant date (years) 4.75 4.75

Risk-free interest rate 3.27% 4.18%

Expected dividend (stated as % of share price at grant date) 1% 1%

Expected departures at grant date 3.5% 7.21%

Fair value per granted option at grant date 1.60 7.91

Valuation model Black & Scholes Black & Scholes

The Company uses the Black & Scholes model to price options, with no vesting conditions other than time. Expected volatility for the stock option plans is based on historical volatility determined by statistical analysis of daily share price movements.

The fair value of shares for the stock options plans was based on the average share price for the 30 days preceding the grant date.

At December 31, 2008, a charge of EUR 2.05 million was recognized in the pre-tax financial statements for employee stock options.

The stock options outstanding at December 31, 2008 have the following expiration dates and exercise prices.Stock option movements can be summarized as follows:


Expiration date Exercise price (EUR) number of stock options

Exercise price (EUR) number of stock options

February 28, 2009 24.90 167 148 24.90 167 148

September 30, 2010 3.72 689 300 3.72 886 000

December 31, 2010 12.60 123 625 12.60 126 325

September 30, 2011 6.37 90 000 6.37 90 000

August 31, 2012 3.34 316 457 3.34 335 291

September 30, 2012 13.64 437 250 13.64 437 250

September 30, 2013 19.94 338 246 19.94 338 246

September 30, 2014 14.18 111 903

totAl outstanding stock options 2 273 929 2 380 260


At the Extraordinary General Meeting of May 9, 2007, the Group’s shareholders agreed to defray its loss through a reduction in the surplus capital of EUR 87.4 million.According to the Belgian Code of Company Law, the legal reserve must equal at least 10 percent of the Company’s capital stock. Until this level is attained, a top slice of at least one-twentieth of the net profit for the year (determined according to Belgian accounting law) must be allocated to building this reserve fund.

The hedging reserve includes changes in the fair value of financial instruments used to hedge cash flows of future transactions.

Other reserves involve the fair value adjustment of available-for-sale investments, the valuation of employee stock option plans, and actuarial gains and losses on defined benefit plans.

Cumulative translation difference includes differences related to the translation of financial statements of consolidated entities whose functional currency is not the euro. It also includes foreign exchange differences arising on long-term loans that are part of the Group’s net investment in its foreign operations with related parties as defined in IAS 21.

17. Reserves(EUR ‘000) December 31, 2008 December 31, 2007

Hedging reserves 689 1 802

Other reserves 8 531 6 595

Currency translation difference -17 064 -12 309

Retained earnings 5 446 70


Average exercise price in EUR per share

number of stock options

Average exercise price in EUR per share

number of stock options

outstanding at January 1 9.85 2 380 260 7.95 2 377 200

Granted 14.18 111 903 19.94 338 246

Forfeited (-)

Exercised (-) 3.80 -218 234 6.56 -335 186

Lapsed (-)

outstanding at December 31 10.65 2 273 929 9.85 2 380 260

Exercisable at December 31 1 259 444 1 071 764


18. Borrowings



non-current

Bank borrowings (Note18.1) 6 295 8 154

Other borrowings (Note 18.3) 2 4 079

Financial lease liabilities (Note 18.2) 5 588 5 621

totAl 11 885 17 854

Current

Short-term bank loans 10 921 1 458

Bank borrowings (Note 18.1) 3 561 2 799

Other borrowings (Note 18.3) 6 455 517

Financial lease liabilities (Note 18.2) 3 314 3 554

totAl 24 252 8 328

18.1 Bank borrowings

Movements on bank borrowings can be detailed as follows:

The maturities of bank borrowings are detailed as follows:

The effective interest rates for bank borrowings at the balance sheet date were as follows:


Non-current 6 295 8 154

Current 3 561 2 799

totAl 9 856 10 953


opening amount 10 953 6 378

New borrowings 503 7 138

Repayment of borrowings -3 397 -3 384

Entry in consolidation scope 1 714 920

Currency translation difference 83 -98

Closing amount 9 856 10 953


One year or less 3 562 2 799

Between 1 and 2 years 2 996 2 568

Between 2 and 5 years 3 298 5 492

Over 5 years 0 94

totAl 9 856 10 953


EUR UsD EUR UsD

Bank borrowings 5.97 % 7.07 % 5.97% 6.81%


Unutilized credit facilities are as follows:

The present value of finance lease liabilities is as follows:

The carrying amounts of finance lease liabilities are denominated in the following currencies:

The average interest rate paid on finance lease liabilities at December 31, 2008 was 6.91 percent (7.93 percent in 2007).

The facilities expiring within one year are annual facilities subject to review at various dates during the 12 months following the end of the fiscal year. The other facilities have been arranged to help to finance the proposed expansion of the Group’s activities.

18.2 Financial lease liabilitiesMinimum lease payments on finance lease liabilities are as follows:


Floating rate

- Expiring within one year 0 259

- Expiring beyond one year 40 918 12 716

Fixed rate

- Expiring within one year 0 0

totAl 40 918 12 975



Later than one year and not later than five years 4 431 4 675

Later than five years 1 081 945

totAl 8 902 9 174


EUR 4 634 2 391

RMB 77 0

USD 4 191 6 784

totAl 8 902 9 174



Later than one year and not later than five years 5 009 5 253

Later than five years 1 202 1 111

10 064 10 426

Future finance charges on financial leases (-) -1 162 -1 252

Present value of finance lease liabilities 8 902 9 174

The carrying amounts of the Group’s borrowings are denominated in the following currencies:


EUR 8 030 8 530

USD 1 826 2 423

RMB 0 0

9 856 10 953


18.3 other borrowingsOther borrowings primarily involve an Industrial Development Revenue Bond issued by the Town of Islip, New York, on behalf of one of the U.S. entities belonging to the IBA Group. This bond matures in January 2009.


19. ProvisionsEnvironment Guarantees litigation Employee

benefits recognized

under IAs 19

other employee

benefits

other total

At January 1, 2008 2 835 1 453 3 501 0 750 3 774 12 313

Additions (+) 10 344 413 367 1 416 150 388 13 078

Write-backs (-) -3 878 -164 -1 484 -4 795 -102 -774 -11 197

Utilizations (-) -1 310 -737 0 -209 -164 - 1 409 -3 829

Actuarial (gains) and losses for the period

0 0 0 323 0 0 323

Reclassifications 0 0 0 0 -99 3 -96

Changes in consolidation scope

45 510 0 21 23 234 1 114 17 871 87 750


40 -17 -24 0 0 30 29

total movement 50 706 -505 -1 120 19 969 899 16 109 86 058

At December 31, 2008 53 541 948 2 381 19 969 1 649 19 883 98 371

19.1 EnvironmentProvisions for decommissioning costs related to the Group sites where radiopharmaceutical agents are produced have been recognized where an obligation exists to incur these costs. This caption also includes provisions for obligations in connection with disposing of used radioactive sources and equipment. These provisions are measured at the net present value of the best estimate of the costs that will need to be incurred. More information on these provisions is included in Note 3 of this report.

19.2 GuaranteesProvisions for guarantees cover guarantees for machines sold to customers.

19.3 litigationProvisions for litigation at December 31, 2008 are primarily for the following:Potential tax litigation in Sweden, for which a provision of EUR 1.2 million is presented at December 31, 2008.Litigation in the United States, for which a provision of USD 3 million was presented at December 31, 2007. This provision was reduced to USD 1 million

at December 31, 2008 (see Note 29). Labor-related litigation in France for which a provision of EUR 0.4 million is presented at December 31, 2008.

19.4 Provisions for employee benefitsProvisions for employee benefits at December 31, 2008 are primarily for the following:Obligations of EUR 7.8 million incurred by CIS Bio International S.A.S. for entitlements of employees active at year-end, in the form of benefits, supplements, and other retirement compensation not covered by the pension or insurance funds ( lump-sum retirement payments, known as IDRs).Obligations of EUR 12.3 million incurred by CIS Bio International S.A.S. for entitlements arising from the lowering of the retirement age for employees working or having worked in hazard areas.

Note that in 2008 these provisions were decreased by EUR 4.9 million due to the partial termination of a labor agreement with CIS Bio International S.A.S. that governs various entitlements and benefits previously granted to employees and retired employees (see Note 27).


20. other long-term liabilities

In 2008, the Group received advances of EUR 1.2 million in cash from the Walloon Region of Belgium, free of interest.

The Group repaid EUR 76.4 million to its shareholders in January 2005. Of this amount, EUR 0.4 million remained unclaimed at December 31, 2007. In 2008, these liabilities to shareholders were reclassified as other short-term liabilities

in view of their due dates (EUR 0.2 million at December 31, 2008).

Other long-term liabilities include down payments of EUR 29.1 million (EUR 15.5 million in December 2007) received on proton therapy contracts for which the corresponding receivable amounts do not qualify for derecognition under IAS 39.


Advances received from local government 16 305 15 097

Liabilities to shareholders 0 403

Other 29 210 18 263

totAl 45 515 33 763

21. other short-term financial assets and liabilities

The Group’s policy on use of financial instruments is detailed in Note 1.22 on Group accounting policies and Note 2 on financial risk management.

At December 31, 2007, the amount of EUR 1.8 million recognized as a short-term financial asset represented the fair value of forward exchange contracts used to hedge future commercial cash flows that were mainly expressed in USD. At December 31, 2008, this amount stood at EUR 2.3 million and included both cash flow hedge instruments (EUR 2.0 million) and hedging instruments accounted for at fair value through profit and loss (EUR 0.3 million).

At December 31, 2008, an amount of EUR 2.5 million was designated as a short-term financial liability and represented the value of cash flow hedge instruments (EUR 0.9 million), as well as that of hedging instruments accounted for at fair

value through profit and loss (EUR 1.6 million).

Some of these financial instruments are designated as hedging instruments inasmuch as they hedge specific exchange rate risks to which the Group is exposed. Hedge accounting has been applied to these contracts because they are deemed to be effective hedges as defined in IAS 39. For these cash flow hedges, movements are recognized directly in equity and released to the income statement to offset the income statement impact of the underlying transactions. Cumulative gains of EUR 0.7 million were recognized directly in equity (in the “Hedging reserves” caption) at December 31, 2008. At December 31, 2007, these cumulative gains stood at EUR 1.8 million.

19.5 otherOther provisions at December 31, 2008 consisted primarily of the following:EUR 12.0 million for obligations incurred by CIS Bio International S.A.S. upon formalization of a restructuring plan (prior to joining the IBA Group).

EUR 4.6 million for obligations related to the treatment of production wastes and disposal of equipment.EUR 1.3 million for commitments made on acquisition of Schering AG’s FDG business in 2006.



22. trade payables

23. other payables

At December 31, the payment schedule for trade payables was as follows:


Amounts due to customers on contracts in progress (or advances received on contracts in progress)

26 759 31 984

Social security liabilities 18 818 8 530

Accrued charges 42 417 5 893

Deferred income 2 157 4 471

Capital grants 1 019 750

Other 9 534 6 396

other payables 100 704 58 024

total (‘000) Due < 3 months 4-12 months

1-5 years > 5 years

2008 71 518 11 875 55 857 3 786 0 0

2007 51 191 13 498 36 949 743 0 0

In 2008, accrued charges increased by EUR 38.8 million as a consequence of the integration of CIS Bio International S.A.S. Most of this (EUR 20 million) was for work required to bring the site at Saclay, France, into compliance with

safety and pharmaceutical standards.In 2008, social security liabilities increased by EUR 9.8 million as a result of the integration of CIS Bio International S.A.S.

24. other operating expenses and income

24.1 other operating expensesOther operating expenses are as follows:


Legal costs 0 4 329

Stock option plan expenses 2 052 2 266

Depreciation and impairment 9 480 1 692

Amortization of revaluation to fair value of assets on the balance sheet of CIS Bio International S.A.S.

5 851 0

Other 1 488 427

totAl 18 871 8 714

Legal costs at December 31, 2007 included costs associated with settling the lawsuit with Optivus Proton Therapy Inc (EUR 1.9 million) and provision for a suit affecting the U.S. subsidiary IBA Molecular North America Inc (EUR 2.1 million) (see Notes 24.2 and 29).

At December 31, 2007, the caption “depreciation and

impairment” included a EUR 1.5 million impairment of trade receivables for a customer in the United States.

At December 31, 2008, the caption “depreciation and impairment” includes an impairment of a third-party investment (EUR 3.7 million) and depreciation on decommissioning assets related to the Radiopharmaceuticals activity (EUR 5.4 million).


Following the sale of two machines in inventory, in 2007 the Group reversed write-downs of EUR 3.2 million previously recorded for these equipments.

In 2008, the caption “Reversal of depreciation and impairment” primarily reflects the reversal of a write-down posted during the previous period on a receivable of EUR 2.2 million with an associate.

In December 2008, the French subsidiary CIS Bio International S.A.S. obtained nuclear operator status, which makes it mandatory to set aside restricted assets over time to cover the future restoration and decommissioning of the nuclear facilities at the site in Saclay, France.

In this context, CIS Bio International S.A.S. has signed a memorandum of agreement with the CEA (Commissariat à l’Energie Atomique), a public organism organized under French law, previous owner of the nuclear facilities of CIS Bio International S.A.S. The CEA agreed to pay monetary compensation of EUR 14.05 million to definitively extinguish its obligation to contribute to the future costs of restoring and decommissioning the nuclear facilities of CIS Bio International S.A.S.

In 2008, the Group also sold the assets at two radiopharmaceutical production facilities in the United States, which generated gains of EUR 1.7 million.


Recovery of provisions for legal costs (see Note 29) -1 484 0

Recovery of provisions for post-employment benefits (see Note 27.2) -4 795 0

Recovery of provisions for other employee benefits -103 0

Reversal of depreciation and impairment -2 226 -3 966

CEA contribution to restricted assets -14 050 0

Gains on sale of fixed assets -1 679 0

Other -893 0

totAl -25 230 -3 966

24.2 other operating incomeThe following is a breakdown of other operating income:

25. Financial expenses and income

25.1 Financial expenses

At December 31, 2008, the caption “Other” mainly reflected the impact of the revaluation of financial assets to fair value through profit and loss (EUR 2.26 million) (see Note 2.2), the cost of discounting defined benefit retirement plans (EUR 0.7 million), and expenses related to the discounting of provisions for decommissioning (EUR 1.97 million).


Interest paid on debts 1 945 1 747

Foreign exchange differences 3 444 1 477

Changes in fair value of derivatives 2 266 171

Other 5 929 958

totAl 13 584 4 353



26. Income taxesThe tax charge for the year can be broken down as follows:

25.2 Financial income

At December 31, 2008, the caption “Other” mainly reflected the impact of revaluation to fair value of an option allowing the Group to increase its percentage ownership in CIS Bio International S.A.S. and subsidiaries (EUR 1.35 million).

The tax charge on IBA’s result before taxes differs from the theoretical amount that would have resulted from application of the average applicable tax rates to the profits of the consolidated companies. The analysis is as follows:


Current taxes 212 2 301

Deferred taxes 6 569 -9 284

totAl 6 781 -6 983


Interest received on receivables and cash position -2 616 -2 321

Foreign exchange differences -5 728 -1 222

Changes in fair value of derivatives -611 0

Other - 1 992 -354

totAl -10 947 -3 897

Given the extent of available tax losses, IBA did not calculate deferred taxes on items credited or charged directly to equity.


Profit/(loss) before taxes 12 110 6 862

taxes calculated on the basis of national tax rates 4 251 2 130

Unrecognized deferred taxes 5 053 691

Tax-exempt transactions 2 482 3 880

Prior year adjustments on deferred taxes 0 -2 157

Write-down of previously recognized deferred tax assets 2 177 0

Loss available for offset against future taxable income 0 -5 931

Utilization of previously unrecognized tax losses -5 240 -5 669

Local tax expense eliminated in consolidation -1 101 0

Other tax (income)/expenses -841 73

Reported tax charge 6 781 -6 983

theoretical tax rate 35.1% 31.0%

Effective tax rate 56.0% -101.8%


The impact of plan termination was recorded in “Other operating income” (see Note 24.2).

Defined benefit plan expenses recognized through profit and loss can be broken down as follows:

(EUR ‘000) December 31, 2008

Cost of services rendered for the period 694

Cost of discounting 722

Expenses/(income) for the period 1 416

(EUR ‘000) December 31, 2008

Defined benefit obligations at may 31, 2008 23 234

Cost of services rendered for the period 694

Cost of discounting 722

Plan termination - 4 795

Benefits paid -209

Actuarial (gains) and losses for the period 323

Defined benefit obligations at December 31, 2008 19 969

27.1 Defined contribution plansAt December 31, 2008, the Group recognized expenses of EUR 0.6 million for defined contribution plans (EUR 1.1 million at December 31, 2007). 27.2 Defined benefit plansIBA records provisions for the defined benefit plans of its subsidiary CIS Bio International S.A.S. At December 31, 2007, IBA did not have any defined benefit plans.

Changes in the present value of defined benefit obligations are presented as follows:

27. Employee benefits

Defined benefit plan expenses accounted for through profit and loss are included in the following income statement captions:

The principal actuarial assumptions at the date of closing are summarized in the note 3(e) above.

(EUR ‘000) December 31, 2008

General and administrative expenses 694

Financial expenses, other 722

Expenses/(income) for the period 1 416



At December 31, 2008, the caption “Other non-cash items” included expenses in connection with employee stock option plans (EUR 2.1 million); inventory losses and write-downs, including the results of reversing asset revaluations during fair value revaluation of the balance sheet of CIS Bio International S.A.S. (EUR 5.4 million); actuarial gains and losses on employee benefits (EUR -0.3 million); the impact of revaluations and gains on the sale of fixed assets (EUR -2.4 million); and the impact of including unrealized foreign exchange differences on the revaluation of the intercompany balance sheet positions of the Group (EUR -1.8 million).At December 31, 2008, “Other cash flows from investing activities” reflected investments made to bring the site at Saclay, France, into compliance with safety and pharmaceutical standards.

At December 31, 2008, “Other cash flows from financing activities” included grants and interest-free cash advances from the Walloon Region of Belgium (EUR 1.6 million), repayment of a loan to a

company of the Group, Schering (EUR -1.5 million), and changes in liabilities to Group employees in connection with the exercise of stock option plans (EUR -0.9 million).

At December 31, 2007, the caption “Other non-cash items” included expenses for employee stock option plans as well as inventory losses and write-downs.

At December 31, 2007, “Other cash flows from investing activities” mainly include repayment of a loan made to a customer in the context of the sale of a system.

At December 31, 2007, “Other cash flows from financing activities” included interest-free cash advances from the Walloon Region of Belgium (EUR 1 million), a cash credit (EUR 1.3 million), payment of the final tranche of a 2005 company acquisition (EUR 1.4 million), and changes in liabilities to Group employees in connection with the exercise of stock option plan (EUR -0.6 million).

28. Cash flow statement

29. Contingent liabilities

The Group is currently involved in certain legal proceedings. The potential risks connected with these proceedings are deemed to be insignificant or unquantifiable or, where potential damages are quantifiable, adequately covered by provisions. Developments in litigation pending at the end of 2007 as well as the principal cases pending at December 31, 2008 are presented in this Note.

Developments in litigation pending at December 31, 2008 mentioned in the 2007 annual report

tax litigation in swedenThe Company is involved in a tax dispute with the Swedish National Tax Board. The case involves interest paid by the IBA Group from Belgium to an IBA Group company in Sweden from 1999 to 2001. Tax was withheld in Belgium, and the income was released to the taxable income of the Swedish

subsidiary. IBA claimed that it was eligible for a tax credit on the amount withheld in Belgium. The Swedish tax board disputed this claim. IBA won its case in the court of first instance. However, the tax board has appealed the decision. The appeals court should issue a decision on the case in the course of 2009. A provision of SEK 12.9 million (EUR 1.2 million) was set aside during a prior period.

litigation with Bayer schering Pharma AGIBA and Schering AG (now Bayer Schering Pharma AG) disagreed on the amount of the net cash flow position when the sale of CIS Bio International was made. Bayer Schering Pharma AG demanded a payment of EUR 0.3 million. The dispute was submitted for arbitration to KPMG France, which sided with IBA. Despite this decision, Bayer Schering Pharma AG is still demanding payment of this amount. However, there are no proceedings pending.


Additionally, in connection with the takeover of the Japanese operations, the parties are involved in a dispute in which Bayer Schering Pharma AG maintains that IBA and IRE have not complied with their best “effort” obligation. No formal litigation has been instigated to date.

Action for damages against IBA molecular north America Inc In 2005, IBA Molecular North America Inc took over three FDG production facilities from the Pharmalogic company. One of its facilities was involved in a suit for damages. A Pharmalogic driver had used his vehicle without authorization outside working hours. He committed a theft and, while fleeing, caused an accident involving a police vehicle and injured a police officer. The case went to jury trial. On February 19, 2008, the court found Pharmalogic negligent in hiring the driver and entrusting him with a vehicle. Rather surprisingly, this negligence was deemed a substantial cause of the injury to the police offer, and damages of USD 3 million were awarded for which Pharmalogic is responsible. Pharmalogic was ordered to pay this amount.

In 2008, acting on a post trial motion, the Court reduced the damage amount to USD 2.3 million. IBA was able to obtain compensation from Pharmalogic’s previous insurers for any amount in excess of USD 1 million. IBA is continuing its

efforts to contest the Court’s decision and to obtain fuller compensation from Pharmalogic’s previous insurers. This litigation is pending.

The provision of USD 3 million set aside in 2007 has been reduced to USD 1 million.

litigation in 2008In the context of the acquisition of CIS Bio International S.A.S., the parties agreed that Bayer Schering Pharma AG would pay an additional EUR 4 million in the event that CISBIO obtained the INB (Basic Nuclear Facility) designation before December 31, 2008. This amount was intended to help CISBIO set aside the reserves required by law of all INB-designated facilities to cover any costs for decommissioning their facilities. A French decree of December 15, 2008 conferred INB status on CISBIO, and Bayer Schering Pharma AG was asked for the EUR 4 million. Bayer Schering Pharma AG refused to pay on the pretext that the law allows the use of means other than cash to establish the guarantee and that its contractual commitment applied only in the case of a mandatory cash reserve. IBA believes that Bayer Schering Pharma AG has no basis for its position and will institute arbitration proceedings for payment through AFA (Association Française d’Arbitrage, French Arbitration Association) in the near future.

30.1 operating leasesThe Group has a number of non-cancelable operating leases relating to vehicle and office space rental. Total future minimum lease payments under non-cancelable operating leases are as follows:

Total operating lease payments included in the income statement in 2008 amounted to EUR 5.1 million (EUR 3.9 million in 2007), of which EUR 1.4 million were for CIS Bio International S.A.S.

30. Commitments



From one to five years 11 402 9 884

Over five years 6 820 6 903

totAl 24 251 20 723



30.2 Financial guaranteesAt December 31, 2008, IBA held financial guarantees for EUR 90 million given by Group entities as security for debts or commitments. Of

this amount, EUR 10.4 million cover guarantees given by the parent company to cover its subsidiaries’ financial lease liabilities and bank borrowings.

31.1 Consolidated companiesA list of subsidiaries and equity-accounted companies is provided in Note 5.

31.2 shareholder relationshipsThe following table shows IBA shareholders at December 31, 2008:

31. Related party transactions

number of shares %

Belgian Anchorage 7 773 132 29.26%

IRE (Institut des Radioéléments) 1 423 271 5.36%

Sopartec 529 925 1.99%

UCL 426 885 1.61%

IBA Investments SCRL * 433 692 1.63%

Public 15 976 192 60.14%

total 26 563 097

* At December 31, 2008, IBA held a total of 433 692 of its own shares through the company IBA Investments SCRL, a wholly owned indirect subsidiary.

IBA’s dominant shareholders—Belgian Anchorage, Belgian Leverage, UCL, Sopartec, and IRE—have declared that they are acting jointly and have entered into an agreement which expires in 2013. In late December 2007, Belgian Leverage transferred all of its stock in IBA to its parent, Belgian Anchorage. The above shareholders’ agreement governs, inter alia, the sharing of information and preferential rights to purchase IBA stock. The parties to this agreement held 10 153 213 shares of ordinary stock at December 31, 2008, representing 38.22 percent of Company’s voting rights.

Under the terms of this agreement, in the event of a new IBA stock offering, if one of the dominant shareholders does not exercise its preferential subscription right, this right will pass to the other dominant shareholders, with Belgian Anchorage S.A. having first right of purchase. If a party to the shareholders’ agreement wishes to sell its shares of IBA stock, the other parties to the agreement will have a preemptive right to acquire this stock, with Belgian Anchorage S.A. having first right of purchase.

This preemptive right is subject to certain exceptions. In particular, it does not apply in the case of a transfer of stock to Belgian Anchorage S.A.

In an agreement signed February 19, 2008, IRE granted IBA a call option on its entire interest in Radiopharma Partners (80.1 percent) and Sceti Medical Labo KK (19.9 percent). This call option was conditional on receipt of notice from IBA of compliance with French regulations applicable to CISBIO regarding the notification to employees. Should it exercise this option, IBA would pay the agreed price in a combination of cash and IBA shares. Without prejudice to the rights and obligations arising under other shareholder agreements, IRE agreed to hold these shares for five years, to grant IBA a preemptive right to purchase these share, and to continue to strive to maintain the “Belgian mooring” of IBA’s shareholders.

On May 29, 2008, IBA exercised this call option to purchase IRE’s 80.1 percent interest in Radiopharma Partners and 19.9 percent interest


in Sceti Medical Labo KK. The approximately EUR 20 million price of the transaction was paid half in cash and half in IBA S.A. stock in order to further strengthen the historic relationship between IBA and IRE, one of its founding shareholders. The cash payment will provide venture capital to fund projects useful for the joint development of IRE, CIS Bio International S.A.S., and IBA. IBA and IRE have also agreed to develop different collaborative projects in which synergies can be optimized by pooling expertise and scientific, technical, and commercial resources.

31.3 Directors and managementAs indicated in the corporate charter (the “Charter”), the Company does not wish to provide specific information on individual compensation. It believes that information of this kind does not offer added value to the shareholders and is potentially harmful to the Company. However, communication of information on compensation policy is important for shareholders and is detailed in the Charter. Actual compensation in 2008 is described below.

31.3.1 DirectorsFixed compensation paid to members of the Board of Directors for services rendered in 2008 totaled EUR 0.13 million. Managing directors were not compensated for attending meetings of the Board of Directors. Non-managing directors did not receive any compensation or other direct or indirect benefit from the Company or any other entity belonging to the Group for their services. However, with the exception of Nicole Destexhe, Peter Vermeeren, and Jean-Jacques Verdickt (J.J. Verdickt SPRL), all of the directors were included as beneficiaries of the 2008 stock option plan. Because the number of options involved is quite small, the Company believes that granting these options does not interfere with the judgment of the recipient directors.

The Company considers that the amount of compensation or other benefits given directly or indirectly to individual directors by the Company or any other entity in the Group is not relevant to this report and should not be included in it.

31.3.2 the Chief Executive officer, the managing directors, and the management team The Board is careful to ensure that the managing directors and the management team are compensated for direct and indirect services to the Company in a manner consistent with market practices based on level of responsibility, services rendered, and nature of duties.

As indicated in the Charter, fixed and variable compensation of the managing directors is determined by the Compensation Committee in accordance with principles approved by the Board. Fixed and variable compensation of the management team is reviewed and determined by the Chief Executive Officer. It has been reported to the Compensation Committee and the Board of Directors and discussed by both. The principle of launching a stock option plan in 2008 and the total number of options issued was approved by the Board of Directors. The Compensation Committee identified the beneficiaries of the stock options and determined the number of stock options granted to each of them.

The total amount paid by the Company and all other entities in the Group in compensation for duties exercised and services rendered directly or indirectly by the two managing directors and the nine members of the management team came to approximately EUR 3.5 million in 2008: around EUR 2.5 million for fixed compensation and around EUR 1 million for variable compensation, given the performance realized in 2007. These amounts are always stated as cost to the company. Note that fixed compensation includes a Group contribution of EUR 0.2 million to a defined contribution plan.

The Company considers that the amount of compensation or other benefits given directly or indirectly to the Chief Executive Officer or to the members of the management team by the Company or any other entity in the Group is not relevant to this report and should not be included in it.

At December 31, 2008, all of the directors together held 1 431 171 shares of IBA stock directly (including 1 423 271 shares held by IRE).


32. Fees for services rendered by the statutory auditors

Ernst & Young Reviseurs d’Entreprises SCRL, auditors of the statutory accounts of IBA S.A. and auditors of the consolidated accounts of IBA, provided the following services during the year:

(EUR ‘000) December 31, 2008

Remuneration for statutory audits and audit of consolidated accounts 643

Tax-related services 7

Other services 26

totAl 676


At the same date, the non-managing directors still held: 600 IBA stock options granted under the 2000 stock option plans600 IBA stock options granted under the 2001 stock option plans600 IBA stock options granted under the 2002 stock option plans15 000 IBA stock options granted under the 2006 stock option plans6 000 IBA stock options granted under the 2007 stock option plans1 000 IBA stock options granted under the 2008 stock option plans

At December 31, 2008, members of the management team, including the managing directors, held a total of 785 436 stock options distributed as follows:6 500 options granted under the 2000 stock option plan at the strike price of EUR 24.9050 000 options granted under the 2001 stock option plan at the strike price of EUR 12.60

255 500 options granted under the 2002 stock option plan at the strike price of EUR 3.34176 500 options granted under the 2004 stock option plan at the strike price of EUR 3.7210 000 options granted under the 2005 stock option plan at the strike price of EUR 6.37124 000 options granted under the 2006 stock option plan at the strike price of EUR 13.64107 261 options granted under the 2007 stock option plan at the strike price of EUR 19.9455 675 options granted under the 2008 stock option plan at the strike price of EUR 14.18

The Company believes that (i) the number of shares, stock options, or any other option purchase rights granted to the Chief Executive Officer or any other members of executive management during the course of the year and (ii) the principal contract provisions regarding the departure of executive managers are not relevant to this report and should not be included in it.


The IFRS standards and IFRIC interpretations below will be mandatory after 2008 but have not yet been applied by the Group.

IAs 23 – Borrowing costsA revised IAS 23 Borrowing Costs was issued in March 2007 and becomes effective for financial years beginning on or after January 1, 2009. The standard was revised to require capitalization of borrowing costs when such costs relate to a qualifying asset. A qualifying asset is an asset that necessarily takes a substantial amount of time to get ready for its intended use or sale. In accordance with the transitional requirements in the standard, the Group will adopt this as a prospective change. Accordingly, borrowing costs will be capitalized on qualifying assets with a commencement date after January 1, 2009. No changes will be made for borrowing costs incurred to this date that have been expensed.

IFRIC 12 – service concession arrangements IFRIC Interpretation 12 was issued in November 2006 and becomes effective for annual periods beginning on or after January 1, 2008. This interpretation applies to service concession operators and explains how to account for the obligations undertaken and rights received in service concession agreements. Because this standard had not been endorsed by the European Union at December 31, 2008, the Group has not implemented it. Also, no member of the Group is a concession operator, and hence this interpretation will have no impact on the Group.

IFRIC 13 – Customer loyalty programsIFRIC Interpretation 13 was issued in June 2007 and becomes effective for annual periods after December 31, 2008. This interpretation requires customer loyalty award credits to be accounted for as a separate component of the sales transaction in which they are granted, and therefore part of the fair value of the consideration received is allocated to the award credits and deferred over the period that the award credits are fulfilled. The Group

expects that this interpretation will have no impact on the Group’s financial statements as no such schemes currently exist.

IFRIC 14 IAs 19 – the limit on a defined benefit asset, minimum funding requirements and their interaction IFRIC Interpretation 14 was issued in July 2007 and becomes effective for annual periods beginning on or after January 1, 2009. This interpretation provides guidance on how to assess the limit on the amount of surplus in a defined benefit scheme that can be recognized as an asset under IAS 19 Employee Benefits. Implementation of this interpretation will have no impact on the Group’s financial statements.

IFRIC 15 – Agreements for the construction of real estateIFRIC Interpretation 15 was issued in July 2008 and becomes effective for annual periods beginning on or after January 1, 2009. It is to be applied retrospectively. It clarifies when and how revenue and related expenses from the sale of a real estate unit should be recognized if an agreement between a developer and a buyer is reached before the construction of the real estate is completed. Furthermore, the interpretation provides guidance on how to determine whether an agreement is within the scope of IAS 11 or IAS 18. IFRIC Interpretation 15 will have no impact on the Group’s consolidate financial statements as it is not involved in activities of this kind.

IFRIC 16 – Hedges of a net investment in a fo-reign operation IFRIC Interpretation 16 was issued in July 2008 and becomes effective for annual periods beginning on or after October 1, 2008. It is to be applied prospectively. The interpretation provides guidance on accounting for the hedge of a net investment in a foreign operation. It clarifies which foreign exchange risks qualify for hedge accounting and where within the group the hedging instrument can be held. It also clarifies what amounts should

33. IFRs standards and IFRIC interpretations not yet effective or applied by the Group


be reclassified to profit or loss on disposal of a hedged foreign operation with respect to exchange differences from translation of the foreign operation and gains and losses arising from the hedging instrument. An analysis is underway within the Group to determine which accounting treatments apply when a foreign operation is disposed of.

IFRs 2 – share-based payments: vesting condi-tions and cancellationsThis amendment to IFRS 2 Share-based Payments was published in January 2008 and becomes effective for annual periods beginning on or after January 1, 2009. The standard restricts the definition of “vesting condition” to a condition that includes an explicit or implicit requirement to provide services. Any other conditions are non-vesting conditions, which have to be taken into account to determine the fair value of the equity instruments granted. In the case that the award does not vest as the result of a failure to meet a non-vesting condition that is within the control of either the entity or the counterparty, this must be accounted for as a cancellation. The Group has not entered into share-based payment schemes with non-vesting conditions attached and, therefore, does not expect any significant impact on its accounting for share-based payments.

Amendments to IFRs 1 – First-time adoption of IFRs and IAs 27 – Consolidated and separate financial statements The amendment to IFRS 1 allows first-time adopters to determine the cost of investments in subsidiaries, jointly controlled entities, or associates either in accordance with IAS 27 or using a deemed cost. The amendment to IAS 27 requires all dividends from a subsidiary, jointly controlled entity, or associate to be recognized in profit and loss in the separate financial statements of the parent company. These two amendments become effective for annual periods beginning on or after January 1, 2009. The amendment of IAS 27 is to be applied prospectively. These new obligations will have an impact on the separate financial statements of the parent company but will not affect the consolidated financial statements.

IFRs 3R – Business Combinations and IAs 27R Consolidated and separate financial statements These revised standards were issued in January 2008 and become effective for annual periods beginning on or after July 1, 2009. IFRS 3R introduces a number of changes in accounting for business combinations after this date that will impact the amount of goodwill recognized, the results in the period that an acquisition occurs, and future reported results. IAS 27R clarifies the treatment of a change in the ownership interest in a subsidiary that does not result in loss of control and requires that this change be accounted for as an equity transaction. Therefore, such transactions will have no impact on goodwill, nor will they give rise to a gain or loss. Accounting treatment has also changed for losses incurred by a subsidiary, as well as for loss of control of a subsidiary. Changes have been made in consequence to IAS 7 Statement of Cash Flows; IAS 12 Income Taxes; IAS 21 The Effects of Changes in Foreign Exchange Rates; IAS 28 Investments in Associates; and IAS 31 Interests in Joint Ventures. IFRS 3R and IAS 27R must be applied prospectively to future acquisitions or disposals and to transactions with minority interests. Early adoption is permitted. However, the Group did not elect this option.

IAs 1 – (Revised) Presentation of financial sta-tements The revised standard was issued in September 2007 and becomes effective for annual periods beginning on or before January 1, 2009. The standard distinguishes between changes in equity arising from owner transactions and changes in equity arising from non-owner transactions. The Statement of Changes in Equity may show only the details of transactions with owners. Non-owner changes in equity must be presented separately. Furthermore, the standard introduces a new presentation option: the statement of comprehensive income, which includes all items of income and expense a single statement rather than two related statements. The Group has not yet decided whether to publish one statement or two.



34. Events after the balance sheet date

35. Earnings per share

In early February 2009, IBA and Eczacibasi-Monrol Nuclear Products AS joined forces to develop the market for PET (positron emission tomography) and SPECT (single photon computed tomography) radiopharmaceuticals in the Balkans, the Middle East, North African, and Central and Eastern Europe. This means that IBA’s PET radiopharmaceuticals production and distribution network now links 52 facilities around the world.In the dispute between IBA and the Swedish

National Tax Board, the Swedish administrative court of appeal handed down its decision on March 23, 2009. The court ruled against the Tax Board and in favor of IBA. With the assistance of its tax advisors, IBA is currently weighing the probability that the Tax Board will file a final appeal. Pending completion of its analysis, IBA still considers the risk to be high and is maintaining the provision of SEK 12.9 million (EUR 1.2 million) presented at December 31, 2008.

35.1 Basic earningsBasic earnings per share are calculated by dividing the net profit attributable to Company shareholders by the weighted average number of ordinary shares outstanding during the period. The weighted

average number of ordinary shares excludes shares purchased by the Company and held as treasury shares.

IAs 32 – Financial instruments: Presentation and IAs 1 Presentation of financial statements – Puttable financial instruments and obligations arising on liquidation These amendments to IAS 32 and IAS 1 were issued in February 2008 and become effective for annual periods beginning on or before January 1, 2009. They allow the classification of puttable financial instruments as equity, provided that they meet certain specific, restrictive criteria. These amendments will have no impact on the Group’s financial position or performance as it has never issued instruments of this type.

IAs 39 – Financial instruments: Recognition and measurement – Eligible hedged itemsThis amendment to IFRS 39 was issued in August 2008 and becomes effective for accounting periods beginning on or after July 1, 2009. This amendment addresses one-sided risks on hedged items and the designation of inflation as a hedged risk or portion of cash flow in particular situations. It clarifies that an entity is permitted to designate a portion of the fair value changes or cash flow

variability of a financial instrument as a hedged item. This amendment will have no impact on the Group’s financial position or performance as it has not engaged in transactions of this type.

IFRs 8 – operating segments IFRS 8 was issued in November 2006 and becomes effective for annual periods on or after January 1, 2009. This standard adopts the same approach to the presentation of operating segments in the notes to financial statements as used by management for its own internal reporting requirements. The Group has not applied this standard and does not expect these changes to have an impact on the Group’s financial statements.

other changes in IFRsIn May 2008, the IASB announced a series of changes in various standards and interpretations designed to eliminate inconsistencies and clarify certain terms. These changes have not been applied in the Group’s financial statements.



Basic earnings per share December 31, 2008 December 31, 2007

Weighted average number of ordinary shares 26 264 308 25 682 274

Profit attributable to equity holders of the Group (EUR ‘000) 5 300 13 930

Basic earnings per share from continuing and discontinued operations (EUR per share) 0.20 0.54

Earnings from continuing operations attributable to equity holders of the Group (EUR ‘000) 5 300 13 929


Basic earnings per share from continuing operations (EUR per share) 0.20 0.54

Earnings from discontinued operations attributable to equity holders of the Group (EUR ‘000) 0 1


Basic earnings per share from discontinued operations (EUR ‘000) - -

35.2 Diluted earningsDiluted earnings per share are calculated by adjusting the weighted average number of ordinary shares outstanding for the effects of conversion of all dilutive potential ordinary shares. The Company has only one category of potentially dilutive ordinary shares: stock options.

The calculation is performed for the stock options to determine the number of shares that could

have been acquired at fair value (determined as the average annual market share price of the Company’s shares) based on the monetary value of the subscription rights attached to outstanding stock options. The number of shares calculated as above is compared with the number of shares that would have been issued assuming the exercise of the stock options.

Diluted earnings per share December 31, 2008 December 31, 2007


Weighted average number of stock options 1 656 632 1 789 081

Average share price over period 14.03 21.64

Dilution effect from weighted number of stock options 821 762 1 334 946

Weighted average number of ordinary shares for diluted earnings per share 27 086 070 27 017 220

Profit attributable to equity holders of the Group (EUR ‘000) 5 300 13 930

Diluted earnings per share from continuing and discontinued operations (EUR per share) 0.20 0.52

Earnings/loss from continuing operations attributable to equity holders of the Group (EUR ‘000) 5 300 13 929

Diluted earnings per share from continuing operations (EUR per share) 0.20 0.52

Earnings/loss from discontinued operations attributable to equity holders of the Group (EUR ‘000) 0 1

Diluted earnings per share from discontinued operations (EUR ‘000) - -


Auditor’s report on the consolidated financial statements




Pursuant to the Royal Decree of November 14, 2007, IBA declares that this annual statement was prepared by Pierre Mottet, Chief Executive Officer (CEO), and Jean-Marc Bothy, Chief Financial Officer (CFO), who declare that, to their knowledge:The consolidated statements for 2008 have been prepared in accordance with applicable accounting standards and accurately reflect the assets, financial position, and earnings of IBA and the undertakings included in the consolidation;The management report gives a true and fair view of the business situation, the earnings, and the position of IBA and the undertakings included in the consolidation, as well as a description of the principal risks and uncertainties facing them.




IBA S.A. annual financial statements

AssEts (EUR ‘000) 2008 2007 2006

FIXED AssEts 242 820 193 876 179 478

Formation expenses 4 0 0

Intangible fixed assets 1 201 801 884

tangible fixed assets 7 287 6 368 3 457

Land and buildings 1 070 879 635

Plant, machinery and equipment 367 107 45

Furniture and vehicles 1 088 1 251 862

Leases and similar rights 3 714 3 889 1 812

Assets under construction and advance payments 1 048 242 103

Financial assets 234 328 186 707 175 137

Affiliated companies 232 556 185 614 172 393

Other companies 0 0 0

Other financial assets 1 771 1 093 2 744

CURREnt AssEts 444 522 276 022 182 807

Accounts receivable after one year 297 344 1 342

Inventories and contracts in progress 339 775 190 898 121 610

Inventories 24 810 10 980 11 385

Contracts in progress 314 966 179 918 110 225

Amounts receivable within one year 71 359 50 787 24 748

Trade debtors 61 709 46 705 22 740

Other amounts receivable 9 650 4 082 2 008

Investments 25 654 3 000 33 261

Cash at bank and in hand 6 855 29 817 669

Deferred charges and accrued income 583 1 176 1 177

totAl AssEts 687 342 469 898 362 285

In accordance with article 105 of the Belgian Code of Company Law, the following statements represent a condensed version of the annual financial statements. The full text is available on request from the headquarters of the Company and will be filed with the National Bank of Belgium. This condensed version does not contain all of the appendices or the report of the auditor, who expressed an unqualified opinion.


InComE stAtEmEnt (EUR ‘000) 2008 2007 2006

operating income 183 445 112 102 67 798

operating expenses (-) -185 127 -112 649 -66 151

Raw materials, consumables, and goods for resale -95 724 -54 104 -21 191

Services and other goods -45 826 -28 686 -22 653

Salaries, social security, and pensions -25 476 -20 309 -15 658

Depreciation and write-offs on fixed assets -16 203 -8 954 -4 822

Increase/(decrease) in write-downs on inventories, work in progress and trade debtors - 808 973 - 341

Provisions for liabilities and charges 569 1 840 - 163

Other operating expenses -1 658 -3 409 -1 323

operating Profit/(loss) -1 682 - 547 1 647

Financial income 25 724 4 998 10 634

Income from financial assets 11 500 0 7 608

Income from current assets 4 574 2 353 1 224

Other financial income 9 651 2 645 1 802

Financial expenses (-) -13 578 -5 313 -9 846

Interest expense -4 375 -1 490 -3 510

Amounts written off on current assets other than inventories, work in progress and trade debtors - increase (decrease)

-2 271 0 0

Other financial charges -6 933 -3 823 -6 336

Profit/(loss) on ordinary activities before taxes 10 464 - 862 2 435

Extraordinary income (+) 17 5 735 0

Gain on sale of fixed assets 0 5 735 0

Other extraordinary income 17 0 0

Extraordinary expenses (-) -3 675 - 1 -3 207

Extraordinary depreciation and write-offs on fixed assets

Amounts written off financial fixed assets -3 653 0 - 199

other extraordinary expenses - 21 - 1 -3 008

Profit/(Loss) for the period before taxes 6 807 4 872 - 772

Income taxes (-) (+) 0 0 0

Profit for the period (+) 6 807 4 872 - 772

transfer to tax free reserves (-)

Profit/(loss) for the period available for appropriation 6 807 4 872 - 772

lIABIlItIEs AnD EQUIty (EUR ‘000) 2008 2007 2006

sHAREHolDERs’ EQUIty 167 961 152 780 150 124

Capital 37 285 36 215 35 747

Additional paid-in capital 124 358 115 198 200 898

Reserves 1 329 989 745

Legal reserve 1 126 786 542

Untaxed reserves 203 203 203

Retained earnings 4 558 217 -87 435

Capital grants 430 161 169

PRovIsIons AnD DEFERRED tAXEs 1 371 1 940 3 781

CREDItoRs 518 009 315 178 208 380

Amounts payable after one year 190 183 142 937 71 789

Financial debts 1 757 2 126 870

Advances received on contracts in progress 78 981 88 375 19 546

Other amounts payable 109 445 52 436 51 373

Amounts payable within one year 324 859 171 074 135 402

Current portion of amounts payable after one year 3 710 4 337 4 562

Financial debts 10 000 0 0

Trade debts 62 026 44 933 16 238

Advances received on contracts in progress 230 601 102 229 102 674

Current tax and payroll liabilities 4 203 4 092 2 334

Other amounts payable 14 319 15 483 9 594

Accrued charges and deferred income 2 968 1 167 1 189



STATEMENT OF CAPITAL Amount(EUR ‘000)

number of shares

Capital

1. Issued capital

At the end of the previous financial year 36 215

Changes during the financial year 1 070 762 845

At the end of the financial year 37 285

2. Structure of the capital

2.1. Categories of shares

• Ordinary shares without designation of face value 20 507 14 734 590

• Ordinary shares without designation of face value with VVPR strip 16 778 11 828 507

2.2. Registered or bearer shares

• Registered shares 9 500 537

• Bearer shares 17 062 560

own shares held by

• The Company itself

• Its subsidiaries 608 433 692

share issue commitments

Following exercise of share options

• Number of outstanding share options 2 273 929

• Amount of capital to be issued 3 183

Maximum number of shares to be issued 2 273 929

Amount of non-issued authorized capital 23 744

IBA S.A. annual financial statements

APPRoPRIAtIon oF REsUlts (EUR ‘000) 2008 2007 2006

Profit/(loss) to be appropriated 7 024 -82 564 -87 436

Profit for the period available for appropriation 6 807 4 872 - 772

Loss carried forward (-) 217 -87 436 -86 664

transfers to capital and reserves 0 87 436

Transfer from capital and share premium account 0 87 436

Transfer from reserves

Appropriations to capital and reserves 341 244

Appropriation to capital and share premium account

Appropriation to legal reserve 341 244

Appropriation to other reserves

Profit/(loss) to be carried forward 4 558 217 -87 436

Profit to distribute 2 125 4 412

Dividends 2 125 4 412



The Board of Directors is composed of nine members. The articles of incorporation and Corporate Governance Charter require a balance on the Board of Directors among outside directors, inside directors, and directors representing the shareholders. The Board of Directors must always be made up of at least one third outside directors and one third directors nominated by the managing directors (“inside directors”). The two managing directors, who are responsible for the Company’s day-to-day management, are also considered inside directors.

The Board of Directors meets whenever necessary, but a minimum of four times a year. The major topics of discussion include market situation, strategy (particularly as concerns acquisitions during the period), technological developments, financial developments, and human resources management. Reports of minutes of the meetings are sent to the directors first so that they may exercise their duties with full knowledge of the facts.

The Board of Directors met eight times in 2008, each time under the chairmanship of Peter Vermeeren. Attendance at meetings of the Board was high. A large majority of the directors attended all meetings. Only seven absences were recorded for all of the meetings, which represents an absentee rate of approximately 9.7 percent. The Company considers that the attendance record of individual directors is not relevant to this report and should not be included in it.

At the proposal of the Nominating Committee, the Ordinary General Meeting of May 14, 2008 elected Jean Stephenne to another term as outside director representing Innosté S.A., and Peter Vermeeren to another term as outside director and Chairman of the Board of Directors. It also reelected Pierre Mottet and Eric de Lamotte, the latter representing Bayrime S.A., as inside directors. All of these terms will expire at the 2011 Ordinary General Meeting to approve the financial statements for 2010.

The philosophy, structure, and general principles of IBA corporate governance are presented in the Company’s Corporate Charter (“Charter”), available on its website www.iba-worldwide.com.

Corporate governance, management and control

1. Board of Directors


2. Compensation Committee

The Compensation Committee met three times in 2008. A report on each of its meetings was submitted to the Board. Topics of discussion included issues relating to the 2007 bonuses, determination of the beneficiaries of the 2008 stock option plan, directors’ compensation, and compensation schemes in general. All of the members attended each meeting.

The Compensation Committee is comprised of Peter Vermeeren, Jean Stephenne (representing Innosté S.A.), and Eric de Lamotte (representing Bayrime S.A.). It is chaired by Peter Vermeeren. Pierre Mottet is invited to attend unless the Committee is deciding on compensation policy or other subjects affecting the managing directors.

The Board of Directors was comprised of the following nine members at December 31, 2008:

CC: Compensation Committee – NC: Nominating Committee – AC: Audit Committee(1) As defined in the Charter. (2) These directors were presented to the shareholders as outside candidates at the time of their election. However, other directors may also meet the same independence criteria.

No director ceased to meet the independence criteria defined in the Charter during the period.

name Age start of term

End of term

Duties at IBA major duties outside IBA

Pierre mottet (1) 47 1998 2011 OGSM

Chief Executive OfficerInside directorManaging directorNC

Member of the Executive Committee of FEB (Federation of Enterprises in Belgium) and Agoria Wallonie, board member of AWEX (Walloon Business Association) and several startup companies.

yves Jongen (1) 61 1991 2010 OGSM

Chief Research OfficerInside directorManaging directorNC

Before the establishment of IBA in 1986, Director of the Cyclotron Research Center of the Université Catholique de Louvain (UCL)

Eric de lamotte (1)

representing Bayrime s.A.52 2000 2011

OGSMInside director CC, NC, AC

Corporate directorFormerly Financial Director of IBA (1991-2000)

Peter vermeeren (2) 68 2000 2011 OGSM

Chairman of the Board of DirectorsOutside directorCC, NC

Formerly Executive Vice President of Mallinckrodt and Executive Vice President of ADAC

Pierre scalliet (2)

representing s.C.s. Psl management Consulting

56 2005 2009 OGSM

Outside director Chief of Service, Oncological Radiotherapy. Professor of Clinical Oncology, Université Catholique de Louvain (UCL)

Jean stéphenne (2)

representing Innosté s.A.58 2000 2011

OGSMOutside directorCC, NC

Since 1998, President and General Manager of Glaxo-SmithKline Biologicals, BelgiumOther offices: Member of the Boards of Directors of Société Belge des Bétons, Fortis, and Nanocyl

Jean-Jacques verdickt (2)

representing sRPl J.J. verdickt

64 2006 2010 OGSM

Outside directorAC

Chairman of Techspace Aero, Vice Chairman of the Euroclear group, member of the Boards of Directors of Alcatel Bell, the Magotteaux group, Euroclear Bank, Logiver, and AWEX (Walloon Business Association)

olivier Ralet representing olivier Ralet BDm sPRl

51 2000 2009 OGSM

Other directorAC

Licentiate of LawMember of the Executive Committee of Atenor Group S.A., Belgium

nicole Destexhe representing Institut national des Radioéléments

56 1991 2010 OGSM

Other director Financial Director of IRE


3. nominating Committee

The Nominating Committee met once in 2008 for the purpose of analyzing the areas of expertise needed by the Board of Directors to fill expiring directorship positions and of making proposals in this regard to the Board of Directors. Based on its report, in May 2008 the Board of Directors proposed the reappointment to the Board of Jean Stephenne (representative and managing director of Innosté S.A.), as an outside director, and Peter Vermeeren, as an outside director and Chairman of the Board. All of the members were present at all meetings.

The Nominating Committee consists of five members, including the Chairman of the Board of Directors and a minimum of two outside directors. The Nominating Committee is currently comprised of Peter Vermeeren, Jean Stephenne (representative of Innosté S.A.), Eric de Lamotte (representative of Bayrime S.A.), Pierre Mottet, and Yves Jongen. It is chaired by Peter Vermeeren.


4. Audit Committee

The Audit Committee met four times in 2008, including three times in the presence of the auditors. A report on each of its meetings was submitted to the Board of Directors. The main topics were the annual results for 2007 and analysis of the auditors’ management letter, analysis of the midyear results, oversight of implementation of IFRS accounting principles, examination of the 2009 budget, and oversight of establishment of an internal audit function. In all of the meetings, there was only one absence.

The Committee is currently comprised of three members: Jean-Jacques Verdickt (representative and manager of J.J. Verdickt SPRL), Oliver Ralet (representative and manager of Olivier Ralet BMD SPRL), and Eric de Lamotte (representative and managing director of Bayrime S.A.). It is chaired by Jean-Jacques Verdickt.

5. Day-to-day and strategic management

Day-to-day management and corporate responsibility in such matters is delegated to two managing directors, currently Pierre Mottet, Chief Executive Officer, and Yves Jongen, Chief Research Officer.

The Chief Executive Officer is specifically responsible for implementing strategy and for day-to-day management and is assisted by a management team consisting of certain members of the corporate team and the presidents of the business units. Together, they constitute the Group’s management team.

The Chief Executive Officer, accompanied by the Chief Financial Officer, makes regular reports to the Board of Directors. The Board of Directors also

asks the management team or division heads to report to the Board on two occasions: adoption of the strategic plan and adoption of the 2009 budget.

The management team was comprised of the following members at December 31, 2008:


6. Conflicts of interest

At its meeting of March 4, 2008, the Board of Directors was to rule on the report of the Compensation Committee. This situation gave rise to application of the procedure stipulated in article 523 of the Belgian Code of Company Law for cases of director conflict of interest. After deliberation, the Board unanimously adopted the recommendations made by the Compensation Committee in its report to the Board regarding both the strategic objectives assigned to the managing directors for 2008 and the determination of variable pay for 2007. The managing directors were then informed of the Board’s decision.

Approval of the launch of a stock option plan by the Board of Directors at its August 27, 2008 meeting also gave rise to application of the procedure stipulated in article 523 of the Belgian Code of Company Law for cases of director conflict of interest.

This conflict of interest affected all of the directors except the Nicole Destexhe, Peter Vermeeren, and Jean-Jacques Verdickt (J.J. Verdickt SPRL).

From the minutes of the meeting: The members approved the principle of launching this plan, as well as the terms of the special report to the Board.

All of the members of the Board were eligible for inclusion in this plan. However, Nicole Destexhe, the Chairman, and Jean-Jacques Verdickt said that they

did not wish to be included in the list of beneficiaries. As beneficiaries of the plan, the other directors stated that they had a direct financial interest and that this gave rise to a conflict-of-interest situation under article 523 of the Code of Company Law. They would not participate further in the discussion.

After discussion, Nicole Destexhe, the Chairman, and Jean-Jacques Verdickt unanimously approved the launch of a stock option plan involving 350 000 options and, consequently, approved the terms of the Board’s special report prepared in compliance with articles 583, 596, and 598 of the Code of Company Law, subject to any changes required by Belgium’s Banking, Finance, and Insurance Commission (CBFA).

Lastly, at its meeting of December 16 and 17, 2008, the Board of Directors was to rule on bringing the compensation of the Chairman of the Board and the Chairman of the Audit Committee in line with market levels. This situation gave rise to application of the procedure stipulated in article 523 of the Belgian Code of Company Law for cases of director conflict of interest.

From the minutes of the meeting:Because discussion of the proposal to increase the compensation of the Chairman of the Board of Directors and the Chairman of the Audit Committee placed these directors in a conflict-of-interest situation under article 523 of the Belgian Code

name title Age locationPierre mottet Chief Executive Officer 47 Louvain-la-Neuve, Belgium

yves Jongen Chief Research Officer 61 Louvain-la-Neuve, Belgium

Jean-marc Bothy Chief Financial Officer 44 Louvain-la-Neuve, Belgium

Jean-marie Ginion President Technology Group 59 Louvain-la-Neuve, Belgium

Frank Uytterhaegen President IBA China 55 Beijing, China

Rob Plompen President IBA Dosimetry 45 Schwarzenbruck, Germany

olivier legrain President IBA Molecular 40 Saclay, France

Jean-marc Andral President IBA Particle Therapy 59 Louvain-la-Neuve, Belgium

Bernard Reculeau President CISBIO Bioassays 58 Saclay, France

serge lamisse President IBA Industrial 45 Louvain-la-Neuve, Belgium

Didier Cloquet Chief of Staff 44 Louvain-la-Neuve, Belgium



of Company Law, they left the room and did not participate in the discussion.

After deliberation, the Board unanimously approved doubling the compensation of the Chairman of the Board and increasing by 50 percent that of the Chairman of the Audit Committee, who would no longer receive stock options.

On returning to the boardroom, the Chairman of the Board of Directors and the Chairman of the Audit Committee asked that implementation of this decision be put on hold until the financial climate improved.

7. Codes of conduct

7.1 Code of conduct to combat insider trading and market abuseThe Company has implemented a code of conduct to combat insider trading and market abuse. This code has been disseminated to all employees. Furthermore, each of the directors and each member of the management team have signed in acceptance of the code in his or her management capacity.

These individuals made the following transactions in their management capacities in 2008:Exercise of a total of 500 stock options issued under the 2002 stock option planExercise of a total of 22 000 stock options issued under the 2004 stock option plan

To the best of the Company’s knowledge, there were no violations of the code of conduct in 2008.

7.2 Code of conduct on contractual relationships between the Company or its related companies and parties related to themThe Company has implemented a code of conduct governing transactions and other contractual relationships between IBA or its related companies and parties related to them. A transaction with a related party is an operation between the Company or one of its subsidiaries and (a) a member of the Board of Directors of IBA S.A., (b) a member of the Group’s management team, (c) a person living under the same roof as these persons, or (d) an undertaking in which a party referred to in (a), (b), or (c) holds significant voting power, whether directly or indirectly. Such transactions must be conducted in accordance with the normal rules of the market. This code was disseminated to all of the aforementioned parties and signed by them.

8. Compensation policy - stock and stock options

As indicated in the Charter, the Company does not wish to provide specific information on individual compensation. It believes that information of this kind does not offer added value to the shareholders and is potentially harmful to the Company. However, communication of information on compensation policy is important for shareholders and is detailed in the Charter. Actual compensation in 2008 is described below.

8.1. DirectorsFixed compensation paid to members of the Board of Directors for services rendered in 2008 totaled EUR 0.13 million. Managing directors were

not compensated for attending meetings of the Board of Directors. Non-managing directors did not receive any compensation or other direct or indirect benefit from the Company or any other entity belonging to the Group for their services. However, with the exception of Nicole Destexhe, Peter Vermeeren, and Jean-Jacques Verdickt (J.J. Verdickt SPRL), all of the directors were included as beneficiaries of the 2008 stock option plan. Because the number of options involved is quite small, the Company believes that granting these options does not interfere with the judgment of the recipient directors.


The Company considers that the amount of compensation or other benefits given directly or indirectly to individual directors by the Company or any other entity in the Group is not relevant to this report and should not be included in it.

8.2. the Chief Executive officer, the managing directors, and the management teamThe Board is careful to ensure that the managing directors and the management team are compensated for direct and indirect services to the Company in a manner consistent with market practices based on level of responsibility, services rendered, and nature of duties.

As indicated in the Charter, fixed and variable compensation of the managing directors is determined by the Compensation Committee in accordance with principles approved by the Board. Fixed and variable compensation of the management team is reviewed and determined by the Chief Executive Officer. It has been reported to the Compensation Committee and the Board of Directors and discussed by both.

The principle of launching a stock option plan in 2008 and the total number of options issued was approved by the Board of Directors. The Compensation Committee identified the beneficiaries of the stock options and determined the number of stock options granted to each of them.

The cost to the Company and all other entities in the Group of compensation for duties exercised and services rendered directly or indirectly by the two managing directors and the nine members of the management team was approximately EUR 3.5 million in 2008: around EUR 2.5 million for fixed compensation and around EUR 1 million for variable compensation. These amounts are always stated as cost to the company. Note that fixed compensation includes a Group contribution of EUR 0.2 million to a defined contribution plan.

The Company believes that the amount of compensation and other benefits given directly or indirectly to the Chief Executive Officer individually by the Company or any other entity in the Group

is not relevant to this report and should not be included in it.

At December 31, 2008, all of the directors together held 1 431 171 shares of IBA stock directly (including 1 423 271 shares held by IRE).

At the same date, the non-managing directors still held:600 IBA stock options granted under the 2000 stock option plans600 IBA stock options granted under the 2001 stock option plans600 IBA stock options granted under the 2002 stock option plans15 000 IBA stock options granted under the 2006 stock option plans6 000 IBA stock options granted under the 2007 stock option plans1 000 IBA stock options granted under the 2008 stock option plans

At December 31, 2008, members of the management team, including the managing directors, held a total of 785 436 stock options distributed as follows:6 500 options granted under the 2000 stock option plan at the strike price of EUR 24.9050 000 options granted under the 2001 stock option plan at the strike price of EUR 12.60255 500 options granted under the 2002 stock option plan at the strike price of EUR 3.34176 500 options granted under the 2004 stock option plan at the strike price of EUR 3.7210 000 options granted under the 2005 stock option plan at the strike price of EUR 6.37124 000 options granted under the 2006 stock option plan at the strike price of EUR 13.64107 261 options granted under the 2007 stock option plan at the strike price of EUR 19.9455 675 options granted under the 2008 stock option plan at the strike price of EUR 14.18

The Company believes that (i) the number of shares, stock options, or any other option purchase rights granted to the CEO or any other members of executive management during the course of the year and (ii) the principal contract provisions regarding the departure of executive managers are not relevant to this report and should not be included in it.


9. Relationship with dominant shareholders

Acting in concert, IBA’s dominant shareholders—Belgian Anchorage SCRL, UCL, and Sopartec S.A., IRE FUP, and IBA Investments SCRL—have entered into an agreement that will expire in 2013. The above shareholders’ agreement governs, inter alia, the sharing of information and preferential rights on the sale of IBA stock. The parties to this agreement held 10 586 905 shares of ordinary stock at December 31, 2008, representing 39.85 percent of Company’s voting rights.

Under the terms of this agreement, in the event of a new IBA stock offering, if one of the dominant shareholders does not exercise its preferential subscription right, this right will pass to the other

dominant shareholders, with Belgian Anchorage S.A. having first right of purchase. If a participant in the shareholders’ agreement wishes to sell its shares of IBA stock, the other parties to the agreement will have a preemptive right to acquire this stock, with Belgian Anchorage S.A. having first right of purchase. This preemptive right is subject to certain exceptions. In particular, it does not apply in the case of a transfer of stock to Belgian Anchorage S.A.

To the best of the Company’s knowledge, there were no other relationships or specific agreements among the shareholders at December 31, 2008.



In application of article 74, para. 7, of the Takeover Bid Act of April 1, 2007 (“Act”), Ion Beam Applications has received the following two takeover declarations pursuant to article 74, para. 6, of the Act:

1. Declaration by related parties, dated october 30, 2007 On October 30, 2007, IBA S.A. acknowledged receipt of a declaration by related parties on behalf of the following companies:Belgian Anchorage S.A. (registered office located at avenue Charles Madoux 13-15, 1160 Brussels), as the owner of 21.22 percent of IBA S.A. capital stock (5 473 132 shares)Belgian Leverage S.A. (registered office located at 3 chemin du Cyclotron, 1348 Louvain-la-Neuve), as a related company of Belgian Anchorage S.A. and the owner of 8.92 percent of IBA S.A. capital stock (2 300 000 shares)IBA Investments SCRL (registered office located at 3 chemin du Cyclotron, 1348 Louvain-la-Neuve), as a related company of Belgian Anchorage S.A. and the owner of 0.11 percent of IBA S.A. capital stock (29 183 shares)

In all, the October 31 declaration involved 7 802 315 shares, or 30.25 percent, of IBA S.A.’s capital stock.

2. Declaration by parties acting in concert, dated February 14, 2008On February 14, 2008, IBA S.A. acknowledged receipt of a declaration by parties acting in concert on behalf of the following companies:Belgian Anchorage S.A. (registered office located at avenue Charles Madoux 13-15, 1160 Brussels), as the owner of 21.22 percent of IBA S.A. capital stock (5 473 132 shares)Belgian Leverage S.A. (registered office located at 3 chemin du Cyclotron, 1348 Louvain-la-Neuve), as a related company of Belgian Anchorage S.A. and the owner of 8.92 percent of IBA S.A. capital stock (2 300 000 shares)IBA Investments SCRL (registered office located at 3 chemin du Cyclotron, 1348 Louvain-la-Neuve), as a related company of Belgian Anchorage S.A. and

the owner of 0.11 percent of IBA S.A. capital stock (29 183 shares)Institut National des Radioéléments (registered office located at Zoning Industriel, Avenue de l’Espérance 1, 6220 Fleurus), acting in concert with the three other declarants (the related parties) and the owner of 3.41 percent of IBA S.A. capital stock (878 660 shares)

In all, the February 14 declaration involved 8 680 975 shares, or 33.66 percent, of IBA S.A.’s capital stock.

3. subsequent eventsAt the end of 2008, IBA S.A. took note of the following events:Belgian Anchorage S.A. had taken over Belgian Leverage S.A., thereby increasing its ownership interest in IBA to a total of 7 773 132 shares, or 29.26 percent, at December 31, 2008.IBA Investments SCRL had increased its ownership interest to a total of 433 692 shares, or 1.63 percent, at December 31, 2008.Institut National des Radioéléments had increased its ownership interest to a total of 1 423 271 shares, or 5.36 percent, at December 31, 2008.

As a result, at December 31, 2008, the declaration by related parties in 1 above involved 8 206 824 shares, or 30.89 percent of IBA S.A.’s capital stock.

As a result, at December 31, 2008, the declaration by parties acting in concert in 2 above involved 9 630 095 shares, or 36.25 percent of IBA S.A.’s capital stock.

10. takeover declarations



104 | IBA RAPPORT ANNUEL 2008104 | IBA ANNUAL REPORT 2008

General InformationCorporate nameIon Beam Applications S.A., abbreviated IBA S.A.

Registered officeChemin du Cyclotron, 3B-1348 Louvain-la-Neuve; BelgiumV.A.T. BE 428 750 985, Nivelles Trade Register

Date, form, and period of incorporationIBA was incorporated for an indefinite period on March 28, 1986 as a société anonyme under Belgian law. It is a listed corporation pursuant to article 4 of the Belgian Code of Company Law and a company that has issued equity to the public pursuant to article 438 of the Belgian Code of Company Law.

Corporate purpose (article 3 of the articles of incorporation)The purpose of the Company is to engage in research and development and to acquire intellectual property rights with a view to the exploitation, fabrication, and marketing of applications and equipment in the field of applied physics. It may engage in any and all securities, real-estate, financial, commercial, and industrial operations that are directly or indirectly related to its corporate purpose. It may acquire an interest, by contribution, merger, purchase of shares, or any other means, in companies, partnerships, or corporations whose purpose is similar, analogous, related, or useful to the achievement of its corporate purpose in whole or in part.

Consultation of corporate documentsThe Company’s statutory and consolidated statements are on file with the National Bank of Belgium. Copies of the Company’s consolidated articles of incorporation, its annual and semi-annual reports, and all other shareholder documentation may be obtained at the Company’s website (www.iba-worldwide.com) or by

shareholder request to the Company’s registered office.

Capital stockAt December 31, 2008, IBA’s capital stock was valued at EUR 37 285 426.37 and consisted of 26 563 097 fully paid shares with no par value, including 11 828 507 shares with VVPR strips.

In June 2000, the Company issued 427 000 stock options for Group employees (“2000 Plan”). Of these options, 185 778 were canceled by notarial act on July 9, 2002, and 74 074 were canceled by notarial act on July 13, 2004. Most of these stock options allowed the beneficiary to purchase a new share at EUR 24.90 following certain procedures during specific periods between June 1, 2001 and February 28, 2009. At December 31, 2008, 167 148 of the 2000 Plan stock options remained outstanding.

In October 2001, the Company issued 500 000 stock options for Group employees (“2001 Plan”). Of these options, 121 100 were canceled by notarial act on July 9, 2002, and 118 375 were canceled by notarial act on July 13, 2004. Most of these stock options allow the beneficiary to purchase a new share at EUR 12.60 following certain procedures during specific periods between December 1, 2002 and December 31, 2010. The following options were exercised in 2008: 1 500 by notarial act of January 16, 2008; 600 by notarial act of July 16, 2008; and 600 by notarial act of October 17, 2008. At December 31, 2008, 123 625 of the 2001 Plan stock options remained outstanding.

In September 2002, the Company issued 3 000 000 stock options for Group employees (“2002 Plan”). Of these options, 167 650 were canceled by notarial act on June 17, 2003; 991 750 were canceled by notarial act on July 13, 2004, and


474 220 were canceled by notarial act on July 11, 2005. Most of these stock options allow the beneficiary to purchase a new share at EUR 3.34 following certain procedures during specific periods between December 1, 2003 and August 31, 2012. The following options were exercised in 2008: 7 270 by notarial act of January 16, 2008; 7 500 by notarial act of April 15, 2008; 3 434 by notarial act of July 16, 2008, and 630 by notarial act of October 17, 2008. At December 31, 2008, 316 457 of the 2002 Plan stock options remained outstanding.

In October 2004, the Company issued 1 000 000 stock options for Group employees (“2004 Plan”). Of these options, 500 000 were given free of charge to employees of IBA and its Belgian subsidiaries and Specific Persons subject to the Belgian Employment Action Plan Act of March 26, 1999 (“free stock options”). Another 500 000 of these options were offered at 4 percent of the strike price to employees and Specific Persons not subject to the Belgian Employment Action Plan Act of March 26, 1999 (“purchasable stock options”). This segment was intended essentially for employees and Specific Persons associated with subsidiaries of IBA S.A. in countries outside Belgium, where stock options are taxed when they are exercised rather than when they are granted. In order to distribute the impact of the tax burden on beneficiaries subject the Belgian Employment Action Plan Act, instead of giving these stock options away, the Company issued them at a price approximately equal to the marginal tax rate burden for beneficiaries subject to the Act. Of the total offering, 496 000 free stock options were accepted, and 390 000 purchasable options were purchased. Consequently, 4 000 options were canceled by notarial act on December 22, 2004. These stock options allow the beneficiary to purchase a new share at EUR 3.72 following certain procedures during specific periods between December 1, 2007 and September 30, 2010. The following options were exercised in 2008: 143 450 by notarial act on January 16, 2008, 15 500 by notarial act on April 15, 2008, 26 900 by notarial act on July 16, 2008, and 10 850 by notarial act on October 17, 2008. At December 31, 2008, a total of 689 300 of the 2004 Plan stock

options remained outstanding.

In October 2005, the Company issued 90 000 stock options for Group employees (“2005 Plan”). All of the stock options were accepted. They allow the beneficiary to purchase a new share at EUR 6.37 following certain procedures during specific periods between December 1, 2008 and September 30, 2011. At December 31, 2008, a total of 90 000 of the 2005 Plan stock options remained outstanding.

In October 2006, the Board of Directors of IBA S.A. decided to issue 575 000 stock options for Group employees (“2006 Plan”). The offering was distributed in much the same way as for the 2004 Plan. As recorded by notarial act on December 22, 2006, of the 332 000 free stock options, 287 500 had been accepted, and of the 243 000 purchasable stock options, 149 750 had been purchased. Consequently, the Board of Directors canceled 44 500 free stock options that had not been accepted by notarial act. At December 31, 2008, there were 437 250 options from this plan. None of these options was exercisable.

In October 2007, the Board of Directors of IBA S.A. decided to issue 450 000 stock options for Group employees (“2007 Plan”). The offering was distributed in much the same way as for the 2004 Plan. As recorded by notarial act on December 20, 2007, of the 259 000 free stock options, 219 788 had been accepted, and of the 191 000 purchasable stock options, 118 458 had been purchased. Consequently, 39 212 free stock options were cancelled. At December 31, 2008, there were 338 246 stock options from this plan. None of these options was exercisable at that date.

In October 2008, the Board of Directors of IBA S.A. decided to issue 350 000 stock options for Group employees (“2008 Plan”). The offered was distributed in much the same way as for the 2004 Plan. As recorded by notarial act on December 18, 2008, of the 200 000 free stock options, 77 283 had been accepted, and of the 150 000 purchasable stock options, 38 187 had been purchased. Consequently, 122 717 free stock options were cancelled. At December 31, 2008,


General Information

there were 115 470 options from this plan. None of these options was exercisable at that date.

Thus, at December 31, 2008, 2 277 496 stock options were issued and outstanding.

All stock options may also be exercised in the event of a takeover bid for IBA or of a capital increase with preferential rights.

Authorized capitalThe Extraordinary General Meeting of May 14, 2008 authorized the Board of Directors to increase the Company’s capital through one or more stock offerings up to a maximum of EUR 25 000 000. This authorization is valid for five years from the date of publication in the Moniteur Belge of the decision of the Extraordinary General Meeting of May 14, 2008; that is, until June 10, 2013. At December 31, 2008, following the launching of the 2008 stock option plan, the authorized capital was valued at EUR 23 744 258.

Patents and technologiesIBA is careful to patent all aspects of its technology for which a patent provides a commercial advantage.

In addition, the Company has maintained the secrecy of a significant portion of its know-how that is unpatentable or for which the Company believes secrecy is more effective than publication in a patent application. More fundamentally, the Company believes that the best way to protect itself from its competitors is not by patenting its inventions, but by maintaining its technological lead.

IBA also licenses patents from third parties and pays royalties on them.

Licensing and cooperation agreementsIBA has licensing agreements involving various aspects of its technology. Listing and explaining the nature and terms of these licensing agreements is beyond the scope of this annual report. These agreements involve, for example, certain aspects of its particle accelerator technology and a number of components of its proton therapy equipment.


sHAREs CAPItAl (EUR ) number of number of operation new shares total shares Change (∆) total03/09/04 Exercise of 1998 Stock options plan + 106 120 24 634 963 +455 255 34 594 19207/13/04 Exercise of 2002 Stock options plan + 5 700 24 640 663 + 7 933 34 602 12510/08/04 Exercise of 2002 Stock options plan +1 790 24 642 453 +2 491 34 604 61503/23/05 Exercise of 2002 Stock options plan + 200 000 24 842 453 + 278 340 34 882 95602/17/06 Exercise of 2002 Stock options plan +350 000 25 192 453 + 487 095 35 370 051 04/18/06 Exercise of 2002 Stock options plan +7 930 25 200 383 +11 036 35 381 087 07/14/06 Exercise of 2002 Stock options plan +159 823 25 360 206 +222 426 35 603 513 10/17/06 Exercise of 2002 Stock options plan +87 110 25 447 316 +121 231 35 724 74310/17/06 Exercise of 2001 Stock options plan +17 750 25 465 066 +24 555 35 749 29901/15/07 Exercise of 2001 Stock options plan +82 550 25 547 616 +114 197 35 863 495 01/15/07 Exercise of 2002 Stock options plan +118 180 25 665 796 +164 471 36 027 967 04/17/07 Exercise of 2001 Stock options plan +20 050 25 685 846 +27 737 36 055 703 04/17/07 Exercise of 2002 Stock options plan +43 280 25 729 126 +60 233 36 115 936 07/17/07 Exercise of 2001 Stock options plan +10 500 25 739 626 +14 525 36 130 462 07/17/07 Exercise of 2002 Stock options plan +56 636 25 796 262 +78 820 36 209 282 10/16/07 Exercise of 2001 Stock options plan +3 350 25 799 612 +4 634 36 213 916 10/16/07 Exercise of 2002 Stock options plan +640 25 800 252 +891 36 214 807 01/16/2008 Exercise of 2001 Stock options plan +1 500 25 801 752 +2 075 36 216 88201/16/2008 Exercise of 2002 Stock options plan +7 270 25 809 022 +10 118 36 227 00001/16/2008 Exercise of 2004 Stock options plan +143 450 25 952 472 +201 447 36 428 44704/15/08 Exercise of 2002 Stock options plan +7 500 25 959 972 +10 438 36 438 88404/15/08 Exercise of 2004 Stock options plan +15 500 25 975 472 +21 767 36 460 65106/23/08 Capital increase +544 611 26 520 083 +764 447 37 225 09807/16/08 Exercise of 2001 Stock options plan +600 26 520 683 +830 37 225 92807/16/08 Exercise of 2002 Stock options plan +3 434 26 524 117 +4 779 37 230 70707/16/08 Exercise of 2004 Stock options plan +26 900 26 551 017 +37 776 37 268 48310/17/2008 Exercise of 2001 Stock options plan +600 26 551 617 +830 37 269 31310/17/2008 Exercise of 2002 Stock options plan +630 26 552 247 +877 37 270 19010/17/2008 Exercise of 2004 Stock options plan +10 850 26 563 097 +15 237 37 285 426

Five-year Capital History



020000400006000080000100000120000140000160000180000200000220000

6

8

10

12

14

16

18

-0,65

-0,55

-0,45

-0,35

-0,25

-0,15

-0,05

0,05

e 6.00 0

-45.00%

-55.00%

60 000

20 000

80 000

e 8.00

-35.00%

100 000e 10.00

-25.00%

140 000

120 000e 12.00

160 000e 14.00

-15.00%

180 000e 16.00

-5.00%

200 000

e 18.00

5.00%

220 000

2 ja

n 08

22 ja

n 08

11 fe

b 0

8

39 fe

b 0

8

20 m

ar 0

8

11 a

pr

08

2 m

ay 0

8

22 m

ay 0

8

11 ju

n 08

1 ju

l 08

21 ju

l 08

8 au

g 0

8

28 a

ug 0

8

17 s

ep 0

8

7 oc

t 08

27 o

ct 0

8

14 n

ov 0

8

4 d

ec 0

8

24 d

ec 0

8

2 ja

n 08

23 ja

n 08

13 fe

b 0

8

5 m

ar 0

8

28 m

ar 0

8

18 a

pr

08

12 m

ey 0

8

2 ju

n 08

23 ju

n 08

14 ju

l 08

4 au

g 0

8

25 a

ug 0

8

15 s

ep 0

8

6 oc

t 08

27 o

ct 0

8

17 n

ov 0

8

8 d

ec 0

8

stock market prices

■ Volume■ Market price

■ IBA■ Bel Mid■ BEL 20

IBA stock is continuously traded on Euronext Brussels. It is included in the Bel Mid index of the Brussels exchange. It was first listed on June 22, 1998 at EUR 11.90 per share (price adjusted for the 5 to 1 split in June 1999). At December 31, 2008, there were no conversion bonds or bonds with warrants outstanding. Total employee stock options outstanding at end-2008 numbered 2 277 496.

The stock market and the shareholdersIBA stock


12/31/2008 DIlUtED 12/31/2007 DIlUtED

shareholders number % number % number % number %

of shares of shares of shares of shares

Belgian Anchorage S.A.(1) (2) 7 773 132 29.26% 7 773 132 26.95% 7 773 132 30.1% 7 773 132 27.58%

Institut des Radioéléments (IRE)(1) 1 423 271 5.36% 1 423 271 4.93% 878 660 3.4% 878 660 3.12%

Sopartec (UCL)(1) 529 925 1.99% 529 925 1.84% 529 925 2.1% 529 925 1.88%

Université Catholique de Louvain (UCL)(1) 426 885 1.61% 426 885 1.48% 426 885 1.7% 426 885 1.51%

IBA Investments(3) 433 692 1.63% 433 692 1.50% 358 692 1.4% 358 692 1.27%

Float 15 976 192 60.14% 18 253 688 63.29% 15 832 958 61.4% 18 213 218 64.63%

totAl 26 563 097 100.00% 28 840 593 100.00% 25 800 252 100.0% 28 180 512 100.0%

(1) Transparency statement at October 30, 2008 (most recent published statement). (2) Belgian Anchorage is a company established and wholly owned by IBA management and employees(3) IBA Investments is a second-tier subsidiary of IBA S.A.

Interim statement, first quarter 2009 May 12, 20092009 General Shareholders’ Meeting May 13, 2009, 10:00 AMPublication of results at June 30, 2008 August 31, 2009Interim statement, third quarter 2009 November 18, 2009Publication of results at December 31, 2009 March 15, 2010

Shareholders’ calendar

IBA stock underwent a major share price correction in 2008, closing at EUR 7.75 at December 31, 2008, down 59 percent from 2007. While IBA could not escape the sharp downturn in the stock markets, it did meet guidances. IBA recorded recurring profit on a par with 2007 (at constant exchange rates). Its recurring earnings before depreciation and amortization (REBITDA) rose a very substantial 74 percent over 2007, and its equity increased by close to 8 percent.


notes

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .


IBA

An

nu

Al

re

po

rt

20

08

e

IBAContactPaul-Emmanuel GoethalsDirector, Corporate Business Development & Investor RelationsTel. : +32 10 47 58 16E-mail : [email protected]

Version française disponible sur demande.

Ion Beam Applications, S.A.Chemin du Cyclotron, 3 1348 Louvain-la-Neuve, BelgiumTel. : +32 10 47 58 11 – Fax : +32 10 47 58 10RPM Nivelles – VAT BE 428.750.985E-mail : [email protected] Website : www.iba-worldwide.com

Published by IBA S.A., Chemin du Cyclotron, 3 1348 Louvain-la-Neuve, Belgium.

www.iba-worldwide.com

Design & Production : www.thecrewcommunication.com

This report is printed on ECF wood-free coated paper.

It was produced in plants that comply with ISO 14001,

the environmental management standard.

Moving ahead confidently Annual report 2008

Date post:	17-Mar-2016
Category:	Documents
Upload:	the-crew-communication
View:	224 times
Download:	2 times

IBA Annual Report 2008

Documents