Getinge ABAnnual Report 2002

2

Annual General Meeting and reports for 2003

The Annual General Meeting will be held on Wednesday 23 April 2003

at 4 p.m. in Getingehallen

NotificationShareholders wishing to participate at the Annual General Meeting

should be registered in the shareholders' register kept by Värde-

papperscentralen VPC AB, (the Swedish Central Securities Depository),

no later than 11 April 2003, 2003, (the record date is 13 April 2003, but

due to the intervening weekend the entry must have been made by

11 April 2003) and notify Getinge's head office at Getinge AB,

Information Dept, Box 69 S-310 44 Getinge Tel: +46 35 15 55 00 of their

intention to participate, no later than 16 April 2003. Shareholders whose

shares are registered in the name of a nominee must have temporarily reg-

istered their shares in their own name with VPC , to be able to participate

at the Annual General Meeting, well in advance of 11 April 2003.

Shareholders wishing to be represented must send a relevant power of

attorney to the company before the meeting. Those representatives repre-

senting legal entities must have a copy of the registration certificate or a

corresponding authorization document that shows the proper authorized

signatory.

DividendThe Board of Directors and President propose that a dividend of SEK

4.25 (3.75 ) per share be paid, totalling SEK 214.5 million. The Board’s

proposed record date is 28 April 2003. VPC anticipates being able to for-

ward the dividend to shareholders on 2 May 2003.

Reports for 2003Getinge AB will be publishing the following reports in Swedish and

English during the year:

• The report for Q1 2003 will be issued in conjunction with the

Annual General Meeting on 23 April 2003 in Getinge.

• Interim report for the first six months of 2003: 14 July 2003

• The report for Q3 2003: 16 October 2003

• Release of the financial statements for 2003: January 2004

• Annual Report for 2003: April 2004

The reports can be ordered from: Getinge AB, Information Dept. Box 69,

S-310 44 Getinge. Tel: +46 35 15 55 00

Information about this Annual ReportThe Getinge Group is referred to in this Annual Report as Getinge.

Figures in brackets refer, unless otherwise specified, to 2001’s activities.

Swedish krona is abbreviated (SEK) throughout this document. Millions

of kronor are written as SEK xx million. All amounts are given in SEK

million, unless otherwise specified.

Information given in the Annual Report concerning markets, compe-

tition and future growth constitutes Getinge's assessment based mainly on

material compiled within the Group.

This document is essentially a translation of the Swedish language

version. In the event of any discrepancies between this translation and the

original Swedish document, the latter shall be deemed correct.

3

Contents

FOCUS AND STRATEGY

The year in brief . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Five-year summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Group overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Comments by the CEO . . . . . . . . . . . . . . . . . . . . . . . . 8

Aims and strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Getinge's shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

BUSINESS ACTIVITIES

Business area - Extended Care . . . . . . . . . . . . . . . . . . . 14

Business area - Surgical Systems . . . . . . . . . . . . . . . . . . 24

Business area - Infection Control . . . . . . . . . . . . . . . . . 34

Getinge in society . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44

Business processes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

FINANCIAL INFORMATION

Directors’ report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50

Financial risk management . . . . . . . . . . . . . . . . . . . . . . 52

Proposed allocation of profits. . . . . . . . . . . . . . . . . . . . 53

Consolidated income statement . . . . . . . . . . . . . . . . . 54

Consolidated balance sheet . . . . . . . . . . . . . . . . . . . . . 55

Consolidated cash flow statement . . . . . . . . . . . . . . . . 56

Accounting principles . . . . . . . . . . . . . . . . . . . . . . . . . . 57

Notes to the consolidated accounts. . . . . . . . . . . . . . . 59

Income statement, parent company . . . . . . . . . . . . . . . 69

Balance sheet, parent company . . . . . . . . . . . . . . . . . . . 70

Cash flow statement, parent company . . . . . . . . . . . . . 71

Notes to the parent company’s accounts . . . . . . . . . . . 72

Auditors’ report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77

The Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78

Group management and auditors . . . . . . . . . . . . . . . . . 80

Addresses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82

4

The year in brief

Orders received – rose by 5% to SEK 8,773 million (8,376 m)

Net sales – rose by 6% to SEK 8,640 million (8,148 m)

Profit before tax – climbed by 17% to SEK 876 million (750 m)

Extended Care – improved operating profit and operating margin– continued focus on organic growth

Infection Control – greater competitiveness through more efficient manufacturing structure

– repositioning for better profitability

Surgical Systems – good growth in profitability– stable platform for continued expansion– acquisition of Heraeus Med Tec underpins

Getinge’s position in Surgical Systems

Cash flow – strong improvement during the year

Dividend – proposal to raise dividend to SEK 4.25 per share (3.75)

5

Five-year summary

The Group 1998 1999 2000 2001 2002

Net sales SEK m 4,345.0 4,884.7 5,253.5 8,148.2 8,640.1

of which overseas sales, % 94.5% 94.5% 95.0% 96.9% 96.9%

Operating profit SEK m 652.9 692.2 697.03) 974.0 1,049.5

Operating margin, % 15.0% 14.2% 13.3%3) 12.0% 12.1%

EBITDA margin, % 18.5% 18.0% 17.0% 16.5% 16.6%

Profit before tax, SEK m 602.6 636.2 623.7 750.4 875.6

Net profit for the year, SEK m 476.7 477.7 467.8 525.3 621.7

Operating capital, SEK m 2,610.6 2,988.2 3,356.8 6,592.8 6,528.7

Shareholders' equity, 31 December, SEK m 1,221.0 1,560.8 1,931.0 2,952.9 3,158.2

Return on operating capital, % 25.0% 23.2% 20.8%3) 14.8% 15.9%

Return on equity, % 39.1% 35.1% 27.6% 20.4% 21.1%

Net debt/equity ratio, multiple 1.41 0.97 1.92 1.36 1.07

Equity/assets ratio, % 27.6% 35.7% 24.2% 30.8% 33.5%

Interest cover, multiple 8.0 9.2 6.8 4.2 5.9

Net investments in fixed assets, SEK m 1) 131.8 167.4 110.3 180.9 149.6

No. of employees, 31 December 3,724 3,812 5,298 5,330 5,556

EPS, SEK 4) 10.20 10.22 10.01 10.60 12.32

Cash flow per share, SEK per share -0.29 9.35 1.91 -1.84 21.04

Shareholders' equity, SEK per share 26.12 33.39 41.31 58.51 62.58

Dividend, SEK per share 2) 3.25 3.50 3.50 3.75 4.252)

Market price, 31 December, SEK per share 122.00 96.00 112.50 172.00 178.00

Dividend yield, % 2.7% 3.6% 3.1% 2.2% 2.4%

No. of shares, 31 December 45,421,632 45,421,632 45,421,632 50,468,480 50,468,480

1) Excluding equipment hired out.

2) As per the proposal by the Board and President.

3) Excluding the refund from SPP of SEK 23.2 million

4) A new share issue was carried out at the beginning of April 2001. For information per share for the time prior to this, the bonus issue

element in the new share issue was calculated by converting it using a factor of 0.9717 (corresponding to 46 745 243 shares instead of

45 421 632), where 2001’s average no. of shares was 49 537 676

DEFINITIONS

Operating capital Total assets, less liquid funds and non-interest-bearing provisions and liabilities, based on the average,

for the year

Return on operating capital Operating profit in relation to average operating capital.

Return on equity Net profit for the year in relation to average shareholders' equity.

EBITDA margin Operating profit before depreciations and amortisation in relation to net sales.

Dividend yield Dividend in relation to the market share price on 31 December.

Cash flow per share Operating cash flow after investments in tangible assets divided by the average number of shares.

Net debt/equity ratio Net debt in relation to shareholders’ equity, plus minority interests

Interest cover Profit after net financial items plus interest costs in relation to interest expenses

Operating margin Operating profit in relation to net sales

Equity/assets ratio Equity plus minority interests in relation to balance sheet total

EPS Net profit for the year divided by the average number of shares

6

Hygiene Systems covers ergonomicbathing and showering solutions.The products are adapted to differ-ent levels of mobility and forms ofresidential care. Research and devel-opment, as well as most of produc-tion, is located in Eslöv, Sweden.

Patient Handling systems covermobile and fixed solutions for liftingand transferring patients. Systemsare adapted for various levels ofmobility. Research and development,as well as most of production, islocated in Gloucester, UK.

Getinge’s Wound Care systemsencompass mattresses for preven-tion and treatment of pressuresores, specially adapted beds, as wellas products for heat treatment.Research and development, as wellas most of production, is located inWaterlooville, UK.

Hygiene Systems Patient Handling Wound Care

BUSINESS AREA EXTENDED CARE

• Systems for hygiene routines and the transfer of the elderly and disabled, as wellas products that prevent and treat pressure sores and bedsores.

• The product range covers bath, shower and hydrotherapy products, supportequipment for patient handling, and clinically-tested mattresses for the treatmentand prevention of pressure sores among people with diminished mobility.

BUSINESS SCOPE

• PRODUCT LEADERSHIP. To continuously develop and expand the marketthrough product development.

• INTEGRATED SOLUTIONS. The business area’s broad product range and a welldeveloped marketing organization with a consultative focus, will enable a widerrange of responsibility to be taken for the working environment and quality ofcare.

• DOCUMENTED CUSTOMER BENEFITS. The documented positive effects forcaregivers and care recipients will be the basis for what Getinge offers itscustomers and enable new financing and payment solutions, in which Getinge andcustomers share the risk.

STRATEGY

• Greater market penetration via an expanded sales organization and customertraining.

• Geographical expansion – Japan and developing markets.

• Greater investment in marketing and training schemes.

• Product development – showering solutions and lighter patient lifters

• Distribution synergies – wound care.

• MARKETING ORGANIZATION: the business area has a central marketingorganization that coordinates global sales and marketing. 97% of sales are madevia the business area’s own sales companies. The business area has 330 salesrepresentatives and 370 service technicians.

• BRANDS: the business area works under one strategic brand – ARJO.Other brands in the business area exist locally or with more limited ranges thanARJO.

PRIORITISED ACTIVITIES

MARKETING ORGANIZATIONAND BRANDS

CUSTOMER SEGMENTS ANDGEOGRAPHICAL MARKETS

Group overview Getinge is a world-leading supplier of medical equip-

ment used in infection control and prevention, surgical

workstations and care of the elderly and disabled. The

Group has 5,600 employees, working at some 70 com-

panies in 25 countries. In 2002, Getinge had sales

worth SEK 8.6 billion, of which 97% was generated

outside Sweden.

Over the past eight years, Getinge has made a num-

ber of important acquisitions and the Group now con-

sists of a broad enterprise with three business areas.

NET SALES PER CUSTOMER SEGMENTAcute health care: 10%

Long-term care: 80%

Specialized care & home care 10%

NET SALES PER GEOGRAPHICAL MARKETWestern Europe: 60%

USA & Canada: 36%

Asia & Australia: 3%

Rest of the world: 1%

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Sterilization covers sterilizers forthe dental sector, health care,research and the pharmaceuticalindustry, as well as system accessories and computerized documentation systems. Researchand development, as well as most ofproduction, is located in Getinge,Sweden.

Disinfection covers flusher disinfec-tors for health care and long-termcare, and washer disinfectors forhealth care, research and thepharmaceutical industry. Researchand development, as well as most ofproduction, is located in Växjö,Sweden, and Toulouse, France.

Disinfection Sterilization

BUSINESS AREA INFECTION CONTROL

• Complete systems to prevent the onset and spreadof infection for health care, long-term care and thepharmaceutical and medical technical industries.

• The product range covers disinfectors, sterilizers,documentation systems and ancillary equipment, aswell as service and consulting.

• World-leading position with own representation inall its important markets.

• COST LEADERSHIP. To utilize the business area’sworld-leading position to maintain the sector’slowest manufacturing costs through efficientproduction and effective distribution.

• INTEGRATED SOLUTIONS. To position theGetinge brand as the sector’s best solution provider,where Getinge’s broad product range and expertisewill benefit customers.

• SERVICE. To utilize Getinge’s well developedservice network as a competitive advantage,through actively bundling and marketing innovativeservices.

• Strengthen and position Getinge as a systemsupplier.

• Improve the manufacturing structure.

• Develop the organization.

• Increase investments in developing products formaterial handling, ergonomics, low-temperaturesterilization and disinfection.

• Expand the service organization.

• MARKETING ORGANIZATION: the business areahas a central marketing organization based inGetinge. 90% of sales are made via the businessarea’s own sales companies. The business area has200 sales representatives and 600 servicetechnicians.

• BRANDS: the business area works primarily underone strategic brand – Getinge.

NET SALES PER CUSTOMER SEGMENTAcute heath care: 60%

Long-term care: 10%

Industry: 30%

NET SALES PER GEOGRAPHICAL MARKETWestern Europe: 46%

USA & Canada: 38%

Asia & Australia: 10%

Rest of the world: 6%

The surgical table range coversboth fixed tables with integratedpatient transport solutions andmobile tables. Research and devel-opment, as well as production, areconcentrated at Rastatt, Germany.

The surgical light range is amongthe very best available.We were thefirst to use gas as a light source,which offers many benefits. Most ofproduction is carried out in Ardon,France.

Getinge’s ceiling service units areused for various types of medicalapparatus needed in the proximityof a surgical workstation, e.g. equip-ment for anaesthesia and screensfor image guided surgery.

Surgical Tables Surgical Lights Ceiling Service Units

BUSINESS AREA SURGICAL SYSTEMS

• Complete systems for surgical workstations, operating rooms and specializedclinics.

• Products for intensive care.

• The product range covers surgical tables, surgical lights and ceiling service unitsfor various types of medical equipment.

• PRODUCT LEADERSHIP. The business area will be a leader in quickly meetingnew customer demands with adapted products, in a sector characterised by rapidchange.

• INTEGRATED SOLUTIONS. To provide integrated solutions in which theindividual products combine to create the best in ergonomics, efficiency andsafety.

• SERVICE. The industry’s best and fastest service coupled with top-qualityproducts, will guarantee maximum availability of operating rooms.

• Complete integration and restructuring of Heræus Med Tec.

• Evaluate new attractive expansion areas in Surgical Systems.

• Develop distribution synergies (cross selling).

• Product leadership in image guided surgery, endoscopy and integrated workplacesfor surgery and radiology.

• Increase market shares in the US and Japan.

• MARKETING ORGANIZATION: the business area has a central marketingorganization based in Rastatt, Germany. 70% of sales are via the business area’sown sales companies. The business area has 200 sales representatives and 250service technicians.

• BRANDS: the business area works under three strategic brands – Maquet, ALMand Hanau.

NET SALES PER CUSTOMER SEGMENTAcute health care: 100%

NET SALES PER GEOGRAPHICAL MARKETWestern Europe: 58%

USA & Canada: 20%

Asia & Australia: 16%

Rest of the World: 6%

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Comments by the CEO

The Getinge Group is the leading supplier of equipment in the areas

of surgical workstations, infection control and ergonomic solutions

for long-term care. Our sales of products and services span more than

100 markets, and we have production at 20 plants in nine countries.

Our overall ambition is to provide, through partnership with our cus-

tomers, products and services that contribute to reduced care costs

and improved quality of care.

2002 – a further year of steady growth

2002 was yet another successful year for Getinge. The acquisition of

Heraeus Med Tec was completed in Q2, and an extensive rationali-

zation programme has begun. The Heraeus acquisition means that we

are now very well positioned for continued growth in Surgical

Systems with a market share that is around three times larger than our

closest competitors. In the Infection Control business area, efficien-

cy-improvement measures for production and marketing continued

during the year, and there was an improvement in terms of prof-

itability in the second half of 2002. Although the sales growth in

Extended Care was weaker than the very strong performance in

2001, the trend has been good on the profit side. The Group’s sales

rose by 6% to SEK 8.6 billion. Profit before tax was SEK 876 mil-

lion, a climb of 17%. The positive profit trend means that we can pro-

pose to the AGM an increase in the dividend to SEK 4.25 per share

(3.75).

Deep involvement in care sector challenges

Trends in the care sector are shaped by a number of factors:

• Technical and methodological advances mean that surgeons can

carry out increasingly complex surgical procedures. This, of

course, heightens requirements for more efficient equipment.

Important steps forward are being made continuously, for instance

in image guided surgery. These developments mean that today’s

surgical procedures can be done faster, cheaper and with more

precision, and the procedures are less stressful for the patients.

• The ability to disinfect and sterilize surgical instruments and

utensils has long been a prerequisite for safe and reliable health

care. Today, the challenge lies in doing this in a rational way.

Great emphasis is placed on being able to control routines

effectively and thereby achieve an optimal utilization of the

hospital’s total resources.

• The long-term care sector faces a growing challenge: the number

of elderly people is growing, while fewer young people are

seeking to work in the care sector. Therefore, the major task is to

make this care cost-effective while ensuring it can offer not only

a good working environment without injurious workloads for

staff, but also dignified living conditions for care recipients.

The Getinge Group is actively involved in these processes. We are

driving the development of products and technologies for surgical

workstations. We offer the market’s most comprehensive and sophis-

ticated range of products and services for handling sterile and disin-

fected goods. We are one of the pioneers of equipment that prevents

work-related injuries in long-term care and continuously develop

new solutions and services to meet the considerable demands and

challenges that characterise this part of the care sector.

Continued organic growth and strategic acquisitions

In general, the demand for medical equipment and products is grow-

ing steadily due to demographic trends and because more and more

people are getting access to health care. Therefore, we continue to

have high ambitions for our organic growth. This means, among

other things, an intensified focus on product development and a deep-

er approach to marketing. The market for surgical products is still

partly fragmented, and we will make further strategic acquisitions to

strengthen and broaden the position of Surgical Systems. In the past

nine years, Getinge has completed over 25 acquisitions. We have the

necessary competence to carry through attractive purchases and suc-

cessfully integrate the acquired companies into our business struc-

ture and thereby realize potential synergy effects.

Surgical Systems – continued strong expansion

Surgical Systems, established in 2001, is our youngest business area.

The growth trend during the year has continued to be good, and work

on developing the business area has proceeded according to plan.

With the acquisition of Heraeus Med Tec, all the foundation stones

are now in place. In 2003, the production structure of the business

area will be refined: by year-end all surgical tables will be manufac-

tured at the plant in Rastatt, Germany, and all surgical lights in

Ardon, France.

Orders received, sales and profit have developed satisfactorily

during the year, even though performance in Germany has been weak

compared with a very strong 2001.

Surgical Systems is well positioned for growth. The outlook is

considered especially good in the US and Japan, where market shares

are relatively low. The image guided surgery side is expanding, and

the business area is on the leading edge of technological development

with the AWIGS and VIWAS systems.

The global market for equipment and products for operating

rooms is estimated at USD 70 billion, and is still very fragmented to

a large extent. Through acquisitions, the business area will focus on

developing leading positions in closely related niches.

Infection Control – repositioning for increased profitability

The Infection Control business area has been considerably reshaped

in recent years. Following a period of many acquisitions in the 1990s,

we have focused on building a coherent and competitive business

the market, with a strong product range and a good marketing organ-

ization. Despite a weaker sales trend, profitability has developed sat-

isfactorily, above all because of enhanced cost-effectiveness in pro-

duction and logistics. A radical programme to improve profitability

in the wound care product line was initiated during the year. This

work will have a positive effect on profit in 2003.

Product development continued at the same pace in 2002, even

though there were few product launches. In 2003, we will introduce

a number of strategically important new products. Product develop-

ment will be concentrated on those product segments where we are

currently underrepresented, such as ceiling hoists, and light, easy-to-

use products for lifting and showering.

Market conditions, which are mainly affected by demographic

and economic factors, continue to be favourable for the business

area. The percentage of the elderly in the population continues to rise.

This is driving demand for long-term care that is both cost-effective

and sensitive to patients’ needs, with good conditions for the elderly

and nursing staff.

In 2002, a number of key people were recruited to build up an

effective organization for sales to developing countries. Today, these

sales account for a very small proportion of total turnover, but good

conditions exist for positive developments in the next few years.

Investments will also be made to improve an already robust market-

ing organization, whose main focus will continue to be on our pres-

ent market segments, where our position is particularly strong.

Outlook for 2003

2003 will be another good year for the Getinge Group, with growth

in line with our organic expansion targets. Market conditions will be

largely the same as those of 2002, i.e. good demand in the US, Far

East and Central Europe, and moderate growth in the rest of Europe.

On the plus side for 2003 is the improved competitiveness of

Infection Control, the ongoing production rationalizations in

Surgical Systems, the acquisition of Heraeus Med Tec, and the new

products that Extended Care will introduce. Cash flow, which was

strong in 2002, will be further improved by establishing a more effec-

tive distribution structure and an even sharper focus from the top

management.

On the minus side for 2003, we see an unfavourable exchange rate

situation. However, all in all our assessment is positive, and we

expect faster profit growth than in 2002.

Johan Malmquist

9

area, both in terms of our manufacturing structure and sales and mar-

keting. During the year, production of sterilization equipment has

been concentrated to the main plant in Getinge, while the remaining

plants have been transformed into units for assembly.

Due to these radical changes, the business area, which previously

suffered from a poor structure and high cost levels, saw a clear

reverse in the operating margin trend during the second half of the

year.

A refined global marketing organization was also established in

2002 with responsibility for marketing and sales of all the business

area’s products in all markets. With the previous acquisitions, we have

had a situation where a large number of brands led to splintered and

cost-intensive communications with our customers. We have therefore

driven a brand project that has refined this variety of brands, so we can

be sharper and more cost-effective in our marketing.

In 2003, long-term work will begin on repositioning the business

area. In the future, the focus will be on sales of integrated systems,

services and various forms of knowledge provision. Product devel-

opment, which in recent years has focused on standardization in the

World Sterilizer Project, will change direction. Prioritised areas in

future will be point-of-use applications, i.e. disinfectors and steriliz-

ers that are close to the user, and efficient solutions for temperature-

sensitive instruments, as well as solutions that optimise goods hand-

ling with a focus on flow, logistics and ergonomics.

Joint organization for Surgical Systems

and Infection Control in the US

The Group has an integrated organization for Infection Control and

Surgical Systems in the US . This structure provides an effective way

to obtain distribution synergies and be an attractive partner to the

major hospital chains and GPOs (Group Purchasing Organizations).

When Getinge acquired MDT/Castle Inc. in 1996, there was a rapid

initial improvement in profitability through cost rationalizations, but

after that, progress has been too slow. In early 2002, we therefore

strengthened management in the US with a clear focus on profitabil-

ity, and also started working towards a long-term positioning of the

company as an innovative and nimble service company in the

American market. In the wake of this change, a large number of

activities have been carried out for improved profitability in 2003.

Production facilities in the US have been given a clear focus on

assembly for core business. Other production operations have been

moved to our plants in Europe or outsourced to American subcon-

tractors. This change will result in considerable improvements in

competitiveness and profitability.

Extended Care – positioned for organic growth

Extended Care continued to be the Group’s most profitable business

area. The business area has a good structure and is well positioned in

10

Aims and strategies

Getinge's solutions are an important element in addressing the chal-

lenges that face the care sector. A population that is getting older and

heavier requires more care. This will mean a rise in care costs and a

greater workload for care institutions worldwide. As the world-lead-

ing supplier, Getinge can help to meet these challenges by develop-

ing new systems and solutions that improve both the quality of care

for patients and the working environment for nursing staff, while

promoting better utilization of resources in the care sector.

Strategy – leading positions in selected markets

The Getinge Group strives to achieve and retain market-leading posi-

tions in the niche markets in which we have chosen to be active.

Organic growth forms the basis of the Group's expansion and means:

• Sales via our own sales companies of complete systems in which

the breadth and depth of our competence benefits customers.

Getinge provides broad solutions that cover products, services,

consulting, training and maintenance in specific areas such as

infection control, surgery or care-related ergonomics.

• Active marketing to further deepen penetration of existing

markets.

• Significant investments to develop maintenance and services. By

focusing on customer benefits in terms of qualitative and

quantitative enhancements, the price of the services diminishes in

importance.

• Active product development and active product acquisitions as a

complement to internal product development.

• Geographical expansion.

• Acquisitions aimed at establishing and broadening new business

areas that are attractive from a growth or overall sector perspective.

Synergies with existing business areas are therefore decisive.

Organization

The Getinge Group is built around three business areas. A business

area consists of a sales and marketing organization and a number of

business units. All sales companies belonging to a business area

report to a sales and marketing manager, who is responsible for dis-

tribution, sales and marketing of the business area's products. For

North America, the Group has a joint marketing, sales and mainte-

nance organization for Infection Control and Surgical Systems.

Health care is the most important customer for both areas. Business

unit managers have a global responsibility for a product area with an

emphasis on manufacturing and product development. Getinge's

organization is flat, and decision-making is highly decentralized.

Considerable emphasis is placed on local management and its com-

petence to react rapidly and independently. The Group currently has

around 70 operative units.

Getinge's business areas

Since it became a listed company in 1993, Getinge has on average

grown in profit terms by 24 percent annually. From being a company

with a very narrow product area, the Group has developed into a

world-leading supplier in three areas – Infection Control, Surgical

Systems and Extended Care – through a consistent focus on product

and concept development, strategic acquisitions and active marketing.

Infection Control

The business area supplies customers in industry and the health care

and long-term care sectors with complete solutions to prevent the

onset and spread of infections. Using internally developed IT soft-

ware, customers can benefit from a quality-assured process for hand-

ling sterile goods. Customers within industry, primarily pharmaceu-

Business concept – a competent solution provider

Getinge is a medical technical Group that through its products and services shall be a com-

petent solution provider for customers within health care, long-term care and industry. The

Group's products, services and competence shall contribute in a quantifiable way to quality

enhancement and the reduction of customers' total costs.

Strategy

• To achieve and retain market-leading positions in the niche markets in which we have cho-

sen to be active, by offering complete systems and knowledge-based solutions.

Financial objectives

• Profit growth measured as profit before tax shall amount to 15% per year on average and

shall be achieved by a combination of organic growth and acquisitions.

• Growth through acquisitions averaging 10% per year shall largely be financed by the

Group’s own cash flow.

tical companies, are offered customer-specific washer disinfectors

and sterilizers for production and research. Products are marketed

under the Getinge and Lancer brands.

Surgical Systems

The business area offers complete systems for surgical workstations

consisting of surgical tables, surgical lights and ceiling service units

for medical equipment. These systems create rationalized, efficient

and ergonomically sound working environments for different types

of surgical procedure. The range covers products for open surgery as

well as the growing market for minimally-invasive procedures (key-

hole surgery). The products are marketed mainly under the Maquet,

ALM and Hanau brands, and are represented in some 100 markets.

Extended Care

The business area offers systems, products and various types of serv-

ices that aim to improve the working environment by dramatically

reducing the occurrence of stress injuries among staff and thereby

also reducing costs. At the same time, use of the business area’s trans-

fer and hygiene solutions leads to improved quality of life for resi-

dents in long-term care. The business area also supplies products to

prevent and treat pressure sores, which are one of the consequences

of patients' restricted mobility. Long-term care is the most important

customer category, but acute health care has good growth potential,

especially in the areas of patient handling and wound care.

Production

The Getinge Group's production is currently carried out at 20 manu-

facturing facilities in nine countries. The business units’ manufactur-

ing is directed towards value-creating production, and non-critical

components are outsourced to subcontractors. This allows internal

resources to be focused on development, design, assembly and qual-

ity assurance. The supplier base for the Infection Control and

Surgical Systems business areas is mainly in North and Central

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

Getinge’s growth is the result of aclear and consistently implementedniche strategy, with a focus on product development and activemarketing, complemented by acquisitions.

The Getinge Group’s sales performance since it became a listed company in 1993, SEK m

12

Net sales per business area

Infection Control: 40 %

Extended Care: 31 %

Surgical Systems: 29 %

Operating profit per business area

Infection Control: 29 %

Extended Care: 47 %

Surgical Systems: 24 %

Europe, whereas the Extended Care business area already has a sig-

nificant and growing proportion of its suppliers in the Far East and

Eastern Europe.

Distribution

About 95% of the Group's sales are made through its own sales com-

panies. This is a conscious choice that is decisive for system sales. It

also ensures that knowledge and competence is maintained at a high

level, and that marketing takes on a more long-term character. The

direct servicing of the customer base means that the profitable after-

market can also be kept within the Group.

Product development

Product development is a cornerstone in the Group's organic growth.

Getinge complements its own product development by cooperating

with competent, external partners. Acquisition is an additional way to

gain access to new technology and new products. A number of com-

plementary product acquisitions have been made in recent years.

Competitors

Among the competitors in Infection Control, there is only the US

company, Steris, that can measure up to Getinge in terms of size and

width of range. Steris is particularly strong in the US in products for

health care. In addition, there is MMM in Germany, Johnson &

Johnson in the US, and Sakura in Japan. The Italian company,

Fedegari, is the biggest competitor on the industry side.

The market for hygiene systems is fragmented with small local

competitors. Our biggest competitor in patient handling is Liko of

Sweden, and in wound care there are two global competitors, KCI

and HillRom, USA.

In the Surgical Systems area, the main competitors are Steris,

Mizuho of Japan and Berchtold of Germany.

Risk management in the Getinge Group

The biggest single risk for Getinge is political. Changes in different

benefit systems in the health care sector can have major effects on

individual markets. As Getinge is active in a large number of geo-

graphical markets, this risk is small for the Group as a whole.

The risk of other companies copying our products is limited,

either due to patents or because manufacture of the products requires

such a heavy investment in tools and such large sales volumes that

our competitors have no viable means of copying them.

New EU norms can mean that customers may perceive little dif-

ference in product quality between the various manufacturers.

Knowledge, service and partnership will therefore become decisive

competitive parameters in the future. Getinge is already well posi-

tioned in these areas, and further investments are being made contin-

ually.

Future expansion

The acquisitions that have characterised much of Getinge's expan-

sion in recent years are an important complement to internally-gen-

erated growth, primarily in Surgical Systems. However, the basis of

the Group's growth will be organic. This means a continued focus on

sales of complete systems, active product development and innova-

tive marketing programmes. The Getinge Group has rapidly taken a

world-leading position in the expansive Surgical Systems area. The

Group sees good opportunities to broaden this business area’s scope

with products in closely related areas, such as surgical instruments or

life support equipment.

The Group’s sales per

geographical market:

2002 2001

Sweden. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3% . . . . . . . . . . . . . 3%

Rest of the Nordic countries . . . . . . . . . . . . . . . . . . . . . . 3% . . . . . . . . . . . . . 2%

Rest of Western Europe . . . . . . . . . . . . . . . . . . . . . . . . 48% . . . . . . . . . . . . 48%

Eastern Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3% . . . . . . . . . . . . . 2%

North America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32% . . . . . . . . . . . . 33%

Asia & Australia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9% . . . . . . . . . . . . . 9%

Rest of the world . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2% . . . . . . . . . . . . . 3%

Total 100% 100

Infection Control Surgical SystemsExtended Care

SALES & MARKETING

PRODUCT DEVELOPMENT & PRODUCTIONHygiene Systems Patient Handling Wound Care

SALES & MARKETING

PRODUCT DEVELOPMENT & PRODUCTIONDisinfection Sterilization

SALES & MARKETING

PRODUCT DEVELOPMENT & PRODUCTIONSurgical Tables Surgical Lights Ceiling Service Units

The Getinge Group’s business areas

500

1000

1500

2000

80

100

120

140

160

180

200

220

JAN02

FEB MAR APR MAJ JUN JUL AUG SEP OCT NOV DEC

Shares

Afv General index

No. of shares tradedin 000s(incl. after-market)

(c) SIX

13

Getinge's shares

Getinge's Class B shares have been listed on Stockholmbörsen’s A list

since 1993. A round lot consists of 200 shares. In 2002, Getinge's

share price reached a high of SEK 207.0 (7 February 2002) and a low

of SEK 138.0 (24 July 2002). The final price paid for 2002 was SEK

178. The number of shares traded during 2002 was 27,150,112

(37,482,155 ). There are approximately 17,000 shareholders. The per-

centage of foreign-owned shares amounts to 33.2% (32.7%) . The

percentage of institutional ownership is 41.5% (42%) of which equi-

ty funds constitute 14.8% (15%).

Share capital and ownership structure

The share capital in Getinge at year-end 2002 was SEK 100,936,960

divided between 50,468,480 shares. Each share has a nominal value

of SEK 2. All shares carry an equal right to dividends. Every class A

share carries 10 votes, and every class B share carries one vote.

Dividend policy

Future dividends will be adjusted in keeping with Getinge's profit

level, financial position and future development potential. The aim of

the Board is that dividends will comprise in the long-term, approxi-

mately one-third of the profit after financial items at a standard rate

of 28% tax.

Getinge is analysed by:

ABG Sundal Collier, Alfred Berg, Carnegie, Cheuvreux Nordic,

Danske Bank, Enskilda, Erik Penser, Handelsbanken, JP Nordiska,

Nordea, Swedbank and UBS Warburg.

SHAREHOLDER STRUCTURE OF GETINGE AB ON 28 DECEMBER 2002 1

Holding Ownership % Share holding%1-500 79.7 4.2501-1.000 10.5 2.61.001-10.000 8.3 6.810.001-100.000 1.0 10.1100.001-10.000.000 0.5 76.3

DEVELOPMENT OF SHARE CAPITAL Number of shares Share capitalYear Transaction after transaction after transaction1990 Formation 500 50,0001992 Split 50:1, nom SEK 100 to SEK 2 25,000 50,0001992 Directed new issue 5,088,400 10,176,8001993 Directed new issue 6,928,400 13,856,8001995 Non-cash issue 15,140,544 30,281,0881996 Bonus issue 2:1 45,421,632 90,843,2642001 New issue 1:9 at SEK 100 50,468,480 100,936,960

LARGEST SHAREHOLDERS AS OF FEBRUARY 2003, including known changes1

No. of class No. of class % of % of Company A shares B shares capital voting rightsCarl Bennet companies 3 375 540 3 755 031 14.1 46.4Robur’s equity funds 4 294 473 8.5 5.3Latour 3 565 000 7.1 4.4Alecta 1 324 133 2.6 1.6AFA Insurance 1 060 200 2.1 1.3SHB 1 004 800 2.0 1.2SHB funds/life 947 834 1.9 1.2Skandia 883 776 1.8 1.2Govt of Singapore 737 170 1.5 0.9Industritjänstemannaförb 652 050 1.3 0.8Other 28 868 473 57.1 35.7Total 3 375 540 47 092 940 100.0 100.0

SHARE CAPITAL BREAKS DOWN AS FOLLOWS:Number Number % of % of

Type of share of shares of votes capital voting rightsA 3,375,540 33,755,400 6.7% 41.8%B 47,092,940 47,092,940 93.3% 58.2%Total 50,468,480 80,848,340 100.0% 100.0%

1. Source.VPC and SIS owner service

14

Extended Care 1998 1999 2000 2001 2002

Orders received, SEK m 1,714.1 1,981.6 2,137.7 2,643.9 2,703.1

Net sales 1,663.0 2,007.7 2,110.9 2,655.5 2,720.0

Share of Group’s net sales 38.3% 41.1% 40.2% 32.6% 31.5%

Gross profit 888.7 1,051.6 1,042.3 1,307.1 1,387.9

Gross margin, % 53.4% 52.4% 49.4% 49.2% 51.0%

Operating costs, SEK m -605.8 -731.2 -719.3 -885.8 -900.3

Operating profit 282.9 320.4 323.0 421.3 487.6

Share of Group’s operating profit 43.3% 46.3% 46.3% 43.3% 46.5%

Operating margin, % 17.0% 16.0% 15.3% 15.9% 17.9%

No. of employees 1,306 1,383 1,559 1,594 1,647

FIVE-YEAR SUMMARY

Business Area Extended Care

15

Review of 2002

2002 was a year of positive development in terms of profit for

Extended Care, whereas a slackening off in the rate of increase was

noted on the sales volume side after a very strong 2001. Profit

increased by 15.7% to SEK 487.6 million (421.3). The operating

margin also improved in 2002 and for the full year was 17.9% (15.9).

Orders received increased by 2.2%, which is equivalent to organic

growth of 5%. The US and UK reported weak growth during the

year, whereas a very strong positive sales trend could be seen in

Australia (25%), Belgium (15%), Holland (18%), Canada (12%),

Spain (33%) and the Czech Republic (28%).

Although 2002 was a year of few product launches, we developed

a number of new products that will be introduced on the market in

2003 including a completely new range of ceiling hoists. The busi-

ness area’s training programme, which covers ergonomics and work-

ing techniques for the care sector, was launched in the UK and

attracted a healthy order intake. In the US the Diligent programme,

which is a combination of training and equipment, generated sales

worth USD 2.4 million during the financial year.

The business area’s logistics project for more cost-effective logis-

tics and reduced tied-up capital continued according to plan in 2002

and is expected to be completed in 2003.

The Extended Care business area is a world-leading suppli-er of hygiene systems and lifting and transfer aids for long-term care, and also offers specialised mattresses for woundcare. The roots of the business area stem from the early1960s, when the first hygiene systems and lifters were pro-duced. Nowadays we offer our customers the widest andmost sophisticated range of products and services on themarket.

Our market share is around 20% of the global market,which is estimated at SEK 12 billion, with a 60% marketshare for hygiene systems, 40% for patient handling and 6%for wound care.We have a global marketing organization of24 sales companies and sales in a further 40 countries viaour network of distributors.

ManagementThe Extended Care business area consists of three business units; hygienesystems, patient handling and wound care, with manufacturing in Sweden,the UK, Germany, Belgium and Canada.The head of the business area is Albrecht Knauf.

Albrecht Knauf

The business area’s customer base isin the institutional care sector andconsists mainly of nursing homes, var-ious types of residential elderly carefacilities and hospitals.

The market

The global market for the business area is valued at approximately

SEK 11.7 billion, with 1.7 billion for hygiene systems, 2.0 billion for

patient lifters and 8.0 billion for wound care products. Annual market

growth is estimated at 6-8%. Growth in patient lifters is higher than

for hygiene systems. Getinge’s market shares are as follows: hygiene

systems 60%, patient lifters 40% and wound care products 6%.

Growth is occurring mainly in patient handling, where the ceiling

hoist product category, (fixed installations of ceiling-mounted lifters)

has grown very dramatically in recent years. Good growth is also

apparent in technical service, the aftermarket and consulting services.

Marketing organization

Having a strong foothold in local markets and long-term relations

with our customers is a fundamental part of the business area’s strat-

egy. At present, Extended Care has 24 sales companies, which

account for 98% of total sales. Other sales are made via a network of

distributors, above all in Asia and Central Europe. With 330 sales

representatives and 370 service technicians, we have both broad and

deep contacts with our customers, and therefore get first hand knowl-

edge of trends in the market.

In late 2001 we established a new sales division in the US called

Diligent Services, which offers ergonomic intervention programmes

to hospitals and nursing homes. The programme consists of intro-

ducing both ergonomic products in care routines and continuous

training of staff in working techniques. A Diligent programme runs

for three years and guarantees a considerable reduction in the num-

ber of work-related injuries. In 2002, its first full financial year,

Diligent secured agreements with 27 new institutions and now has a

total of 35 ongoing programmes. Diligent has been approved by the

American Hospital Association as a supplier of ergonomic patient

handling solutions. Diligent’s sales, divided between equipment and

services, amounted to USD 2.4 million in 2002.

In Holland the business area has for many years run commercial

ergonomics programmes aimed at the care sector. In 2002 sales

amounted to EUR 1 million, which is an increase of over 30%. The

same programme was launched in the UK market in 2002. In addi-

tion to this activity being profitable in itself, an increased knowledge

of ergonomic matters in the market contributes to increased demand

for the business area’s products and other services.

Trends

The most important external factor affecting Extended Care is the

demographic trend that is leading to a higher percentage of the pop-

ulation being in need of care and professional nursing. The underly-

ing need for the business area’s products and services will therefore

increase considerably in the coming decades. Another trend that also

seems favourable for the business area is the increased focus on

working environment issues and the importance of being able to

17

Our customers

The Extended Care business area’s customer base is solely in the care

sector and consists of nursing homes, various types of residential eld-

erly care facilities and hospitals. The biggest customer segment is

made up of publicly financed institutions, which account for around

50% of sales. Charitable organizations such as Caritas and the Red

Cross account for 30% and privately financed institutions for 20%.

The greater part of sales, 80%, relates to various types of long-term

care. Other sales are divided between acute health care, rehabilitation

and home care.

The care sector, and long-term care in particular, is currently hav-

ing to confront major issues due to demographic trends and the

increased number of overweight people. The rising number of elder-

ly people has meant that only those who require the highest level of

care get placed in nursing homes. This has led to a heavier workload

for staff, with different types of stress and attritional injuries as a

result. In addition to the human suffering that this causes, it also

means considerable costs for the care sector, for instance from

increased insurance costs and, in many markets, large compensation

claims. This situation also means that it is difficult to recruit person-

nel, and the consequences are staff shortages, an even heavier work-

load and high wage inflation.

Extended Care’s overall offer means that the working environ-

ment is improved through the use of ergonomically designed equip-

ment for daily activities such as patient transfers from bed to wheel-

chair or toilet, etc, and solutions for bathing and showering. One per-

son can now perform many of the working routines that previously

required two nurses. This increases efficiency while significantly

reducing the risk of injuries.

The introduction of ergonomic aids also improves the situation

for residents and patients. They now have more opportunities to get

out of bed, get to the toilet in time, and in comfortable and dignified

ways carry out their daily hygiene routines such as bathing or show-

ering. In short, their quality of life is improved. We also offer our cus-

tomers a range of rehabilitation products that are particularly suitable

for people with reduced mobility.

The diminished mobility of many of the residents means that

there is a clear risk of pressure sores. People who cannot turn them-

selves in bed or alter their centre of gravity when sitting risk the onset

of pressure sores within a few hours. Pressure sores are very painful

for those affected and require long and cost-intensive treatment.

Therefore, the business area has developed a range of specialized

mattresses, which can be used for both preventive purposes and in the

treatment of pressure sores.

In addition to our broad programme of systems and products, we

also offer our customers a number of services, e.g. assessments of a

specific care unit’s equipment requirements, training of staff in cor-

rect working techniques and advice to architects who design nursing

homes and hospitals.

attract, recruit and retain staff. Clearly, a prerequisite for this is access

to ergonomic aids in daily care routines. The greater obesity problem

in industrialized countries will amplify and change the requirements

of daily care.

Product positioning

The business area’s products and services are at the forefront regard-

ing quality, functionality and design. However, the decisive factor for

the customer is not individual product’s performance. On the con-

trary, it is becoming increasingly important to present complete solu-

tions. Here the decisive factor is not individual products, but what

results the combined measures such as assessments, products, train-

ing and technical service can give the customer in the form of

improved working environment, enhanced quality of care and greater

cost-effectiveness.

Competitors

Getinge is the only truly global supplier of systems for institutional

long-term care. Competitors are generally local manufacturers active

in one or a few geographical markets. Price is generally their main

competitive weapon. No other supplier can match Getinge’s broad

product portfolio. Competitors often specialize in either hygiene or

lifting solutions. Their sales are usually made via external distribu-

tors, which means there is no direct contact with the customer.

Getinge’s strength comes primarily from a well structured sales

organization, strong marketing support, innovative solutions, high

product quality and active product development. It is also becoming

increasingly important to offer solutions that are a mix of consulting,

technical service and products. Getinge is one of the few suppliers

that can offer this combination.

In hygiene systems the business area has a very good position

with healthy market shares and a very strong product portfolio. Sakai

has an estimated 8% of the world market, but concentrates on Japan.

The English company, Chiltern, has 4%. On the lifter side, Liko is the

biggest and fastest growing competitor with a market share of around

10%. Liko has good quality products, including a strong range of

ceiling hoists. Their product range is narrower than Getinge's and

limited solely to lifting equipment.

Product development

Development of new products, systems and solutions with unique

functionality is of central importance to the business area’s organic

growth. Development work is organized according to the business

area’s three business units: hygiene systems are developed in Eslöv,

Sweden; patient handling products in Gloucester, UK and in

Hamont-Achel, Belgium; and wound care products in Waterlooville,

UK. All product development is done in close cooperation with the

business area’s customers and marketing companies, and develop-

ment projects are coordinated between the three business units, above

all between hygiene systems and patient handling, where there are

considerable synergies. At present, development resources are being

concentrated on the product segments in which we are currently

Innovative, proactive product development is one of the cornerstones of the business area’s long-term strategy.

19

underrepresented, primarily ceiling hoists and simple, easy-to-use

showering solutions. A new ceiling hoist range will be introduced in

the first half of 2003 and further product launches will happen in the

next 12 months.

One of the most important factors in all development work is

patients’ different mobility levels. If good and efficient care is to be

provided, it is vitally important that patients do not get more help than

they actually need. On the contrary, it is important that patients are

stimulated to retain their level of mobility for as long as possible.

Another crucial parameter is the working space that is available for dif-

ferent activities. One of the trends in long-term care is towards private

bathrooms for individual use instead of large central facilities. This cre-

ates entirely new priorities in the design of functional products.

Production

The business area’s production is concentrated at our manufacturing

plants in the UK and Sweden, which account for 80% of the value of

production. The remaining 20% stems from our facilities in Belgium,

Germany and Canada. After the radical reorganization in 2001,

which centralized a number of key functions, we have achieved con-

siderable synergies in production, purchasing and design – a fact

clearly reflected in our profit for 2002. Constantly improving com-

petitiveness is a prerequisite if the business area is to continue to per-

form well in terms of both sales volumes and profit. During the year

as part of this drive, we moved elements of production that had pre-

viously been based in the US to Eslöv. In 2002 we also established

delivery times that are based on market requirements and raised aver-

age delivery reliability to over 96%. All production units achieved

significant productivity increases during the year. The business area

also reviewed its supplier structure, reduced the total number of sup-

pliers, and increased purchasing from Asia and Eastern Europe.

Logistics

The business area’s production facilities are in several cases far from

the main markets. This is why it is of utmost importance to find logis-

tics solutions that satisfy our customers’ needs for exact deliveries in

a cost-effective way. Consequently, a logistics project was initiated in

2001 that has run throughout 2002 and is expected to be completed

in 2003. In the final structure all deliveries in Europe will go direct

from the factory to the customer, while all invoicing will be handled

centrally with a minimum of administrative costs.

Production in the business area is focused on a number of core

areas such as surface finishing and assembly.

Quality

The business area’s products are designed to handle elderly and dis-

abled people. That is why the utmost emphasis is placed on our prod-

uct quality being of the highest standard in terms of functionality and

safety. Concern for quality and safety is therefore something that per-

meates the entire chain from development and design to production.

All of the business area’s main plants have ISO certified quality sys-

tems that set requirements for staff responsibility, premises and

equipment, safety tests, documentation, trackability, and so on.

As an important part of our overall quality-related work, we carry

out attitude surveys among our customers to ensure that we are pur-

suing continuous improvement according to their perspective.

In 2002 we also introduced structured benchmarking to help us

achieve our aim to create a business of the highest quality. Electrolux,

Tetra Pak and Atlas Copco are some of the companies we have coop-

erated with.

Competence development for the staff is also an important

instrument in quality-related work. During the year we intensified

our focus in terms of needs-driven and target-oriented competence

development. The objective is that all employees shall have an indi-

vidual competence development plan. The number of training days at

the production units increased by 30%.

2003 – activities for increased growth

2002 was a somewhat weaker year in terms of volume growth for the

business area. In 2003 a number of initiatives will be carried out for

the long-term development of the business area. New concepts and

products are of the highest strategic importance if the business area

is to continue to grow with maintained profitability. During

2003/2004 we will launch a number of products that will further

strengthen our position.

Geographical expansion is another priority. The business area’s

sales to the developing markets are presently marginal, but our

assessment is that we have very good opportunities for growth, par-

ticularly in Asia and Central Europe.

The aftermarket, which is by its nature very profitable, also holds

good possibilities for growth in the next few years, and our focus on

it will be further intensified.

Marketing in the form of innovative programmes and activities

will be stepped up during the year, as will direct sales-supporting

activities such as education, training and customer support.

All things considered, we expect a further year of steady growth

in our most important markets with particularly positive sales trends

in Holland, France, Italy, Spain and among the developing markets in

Asia.

WORLD MARKET Product segment Hygiene Systems Patient Handling Wound CareValue SEK 1,700 m SEK 2,000 m SEK 8,000 mGrowth, % approx. 5 8-10 approx. 5Getinge’s market share, % 60 40 6

MARKET TRENDSOrders received per market 2002 2001 ChangeUSA & Canada 934.0 962.8 -3.0%UK 724.7 737.2 -1.7%Germany 284.3 271.5 4.7%Rest of Western Europe 652.5 579.0 12.7%Rest of the world 107.6 93.4 15.2%Business area total 2,703.1 2,643.9 2.2%Changes adjusted for acquisitions and currency-related effects 4.7%

NET SALES PER MARKETWestern Europe: 60%USA & Canada: 36%Asia & Australia: 3%Rest of the world: 1%

NET SALES PER CUSTOMER SEGMENT Acute health care: 10%Long-term care: 80%Specialized care & home care 10%

DISTRIBUTIONOwn sales companies: 98%Distributors: 2%

21

EXTENDED CARE: SUMMARY

22

Rhapsody is the bath with the

highest functionality and safety

standards on the market.The bath

has been developed for people with

heavily diminished mobility.The

bathtub is height-adjustable and key

hole-shaped, providing good

ergonomics for the caregiver.

The Parker Bath has been part of

the Getinge Group since 2000, when

the Parker Bath company was

acquired.With the Parker sit bath,

Getinge has a comprehensive bath

range. Like the Rhapsody, it is height-

adjustable for good ergonomics.

Freedom Bath was developed in,

and for, the American market.The

tub is primarily intended for various

types of residential facilities for the

elderly, where residents can perform

hygiene routines unaided.The unique

roller door enables an elderly person

to get in and out of the tub without

assistance.

Rhapsody Parker Bath Freedom Bath

BATHING SYSTEMS

Carendo is the first product in a

new generation of solutions for

showering. Carendo offers

exceptionally good ergonomics for

caregivers and good comfort and

dignity for the care recipient.

Carendo has a number of

characteristics that make it unique

on the market, including a function

for simple diaper changing.

Concerto is a shower trolley that

via simple transfers offers the

possibility to take recumbent patients

directly from bed to shower.

Prelude is a shower cabinet with

good functionality. Among other

benefits, it is possible to use a mobile

lift chair to take the care recipient

from bed to shower and back

without manual lifting.

Carendo Concerto Prelude

SHOWERING SYSTEMS

Axona is a pool designed for

hydrotherapy.The glass walls enable

the therapist to monitor and correct

the patients’ movements.

Entroy is a pool lift that helps peo-

ple with diminished mobility get in

and out of pools.

Sidekick is a mobile unit for

localized hydromassage.The product

is simply rolled in to the patient, who

can be given treatment on arms and

lower legs.

Axona Entroy Sidekick

THERAPY SYSTEMS

PRODUCT OVERVIEWEXTENDED CARE

Leaders in quality and design

Our team of specialists in research and

development work in close cooperation

with caregivers, therapists and nursing

staff worldwide. These contacts mean

that we can rapidly identify and address

new trends and needs. The business area

retains its leading position by being first

to market with innovative products that

meet altered needs in the care sector. Our

products offer added value such as effi-

ciency, hygiene, safety, sound ergonomics

and user-friendliness in a simple and

functional design.

Our lifters and bathing systems are

used by thousands of people every day.

Product quality is critical to their safety.

The ISO quality assurance systems

9001:2000 and EN 46001 are used at our

manufacturing plants in Eslöv, Sweden,

and Gloucester, UK. All our products

must undergo extensive function testing.

The internal tests that are carried out are

more comprehensive than those required

to fulfil national and international regula-

tions and directives.

In 2003 all production plants in

Extended Care will be certified for envi-

ronmental management in accordance

with ISO 14001.

23

Opera fitted with a stretcher is

principally designed for acute health

care, where there is often a need to

move completely immobile patients.

Opera is a manual lifter with a

lightweight design that makes it easy

to manoeuvre. All functions are

controlled rapidly and simply via a

handset.The chassis can be easily

opened and closed, which makes it

possible to use the lifter for raising a

patient from a wheelchair.

Tempo has many similarities with

Opera, but with a simpler design and

somewhat lower functionality.

Trixie Lift is a small and easy-to-

use lift intended for small institutions.

Trixie Lift can be simply folded up

and therefore requires very little

storage space.

Bianca is a ceiling hoist that fulfils all

the requirements for simple handling.

The lift eliminates all manual lifting

and can be installed in all types of

rooms. It is always available when

required for use, but never gets in

the way.

Opera with stretcher Opera Tempo Trixie Lift Bianca

PASSIVE LIFTERS

Encore is the latest active lifter

from the Getinge Group.With its

modern design and high functionality,

Encore can be used for more patient

categories than any other active lifter.

Encore is also well suited for various

types of rehabilitation.

Chorus is based on the same

design as Encore, but has somewhat

lower functionality.

Sarita is an active lifter especially

adapted for small institutions.

Stedy is a unique compact product

that can be used simply, quickly and

efficiently for short transfers.

Exelsior is a simple and efficient

active lifter with good functionality.

Encore Chorus Sarita Stedy Exelsior

ACTIVE LIFTERS

Trinova offers 24-hour protection

against pressure sores.Trinova’s

mattress and seating system is an

ideal solution when there is a high

risk of pressure sores.

Bi-Wave Carer offers a cost-

effective alternative, which is suitable

for use both in acute health care and

long-term care.

Paragon 5000 is a specialized bed

developed for particularly acute

situations such as deep burn injuries.

Pegasus Inditherm System is a

product system designed to keep

patients warm during and after

operations – a factor that has very

positive effects on clinical results.

Kombat K2 is a prophylactic

mattress that considerably reduces

bodyweight and thus lowers the risk

of pressure sores appearing.

Trinova Bi-Wave Carer Paragon 5000 Pegasus Inditherm System Kombat K2

WOUND CARE PRODUCTS

24

Surgical Systems 2000 2001 2002

Orders received, SEK m 157.8 2,262.8 2,589.6

Net sales, SEK m 146.6 2,223.4 2,520.8

Share of Group’s net sales 2.8% 27.3% 29.2%

Gross profit 44.4 1,106.2 1,200.5

Gross margin, % 30.3% 49.8% 47.6%

Operating costs, SEK m -45.4 -877.8 -945.6

Operating profit -1.0 228.4 254.9

Share of Group’s operating profit -0.1% 23.4% 24.3%

Operating margin, % -0.7% 10.3% 10.1%

No. of employees 76 1,372 1,499

THREE-YEAR SUMMARY

Business Area Surgical Systems

25

Review of 2002

2002 was a good year for Surgical Systems. Orders received climbed

by a total of 14.4%, equivalent to organic growth of 4.0%. The

upward trend was particularly strong in North America and the UK,

where orders received soared by 28.2% and 33.7% respectively.

Performance in Germany was weak for the year as a whole. The rest

of Western Europe, as well as Japan and a number of developing mar-

kets, reported strong volume growth. Operating profit also developed

satisfactorily and increased by 11.6%. The slight decline in the oper-

ating margin can be attributed to the acquisition of Heræus Med.

The acquisition of Heræus Med, completed during Q2 of 2002,

gives Getinge a solid foundation on which to continue to strengthen

the business area’s position. A comprehensive restructuring pro-

gramme has begun. Once completed, it will mean that production

currently run in Hanau, Germany will be moved to the business

area’s existing production sites in Germany and France. Heræus Med

will contribute around SEK 50 million to the operating profit in

2003. ALM’s surgical tables business was sold in Q4 to Fournitures

Hospitalières, providing a small capital gain.

Medica, the world’s largest health care exhibition, held in

Germany, was the platform for a number of new product launches by

the business area. These included a surgical table for ophthalmic sur-

gery, and the Axcel and G8 surgical lights.

The Surgical Systems business area is the world-leading sup-plier of surgical workstations.The product range consists ofsurgical tables, surgical lights and ceiling service units formedi-tech equipment. Our first surgical table was sold morethan 160 years ago.

Our market share is around 40% for surgical tables andsurgical lights, and about 15% for ceiling service units. Theglobal market for these types of products is estimated atSEK 7.4 billion.We have a global marketing organization withsales in more than 100 countries.

ManagementThe Surgical Systems business area consists of three business units; surgicaltables, surgical lights and ceiling service units for medi-tech equipment.Thehead of the business area is Heribert Ballhaus. Sales and marketing iscoordinated by a global marketing organization, which is headed byMichael Rieder.

Heribert Ballhaus Michael Rieder

The business area’s customers aresurgeons and other medical staff atacute care hospitals around the world.

27

Our customers

Technological advances and the demographic trend towards an age-

ing population have resulted in an increasing number of surgical pro-

cedures being performed around the world. In the US alone, 24 mil-

lion operations were performed in 2002 according to the FDA, and

that figure is expected to rise by 5% annually. Operations are hospi-

tals’ most important source of income and surgeons generally act to

a great extent as both stipulators of equipment and decision-makers.

With this in mind, it is not surprising that many hospitals allocate

resources in order to create solutions that offer very high perform-

ance and efficiency.

One such example of the technical advances in recent years is

image guided surgery, which has considerably extended the scope of

minimally-invasive surgery (keyhole surgery). This type of surgery

has many benefits. Procedures can, for example, be performed faster

and with more precision, plus the convalescent period for the patient

is considerably reduced.

The Surgical Systems business area’s customers are surgeons and

other medical staff at acute care hospitals around the world.

Financing of hospital activities is by public and private funding, or

from funds raised by charities such as Caritas in Germany.

The core of the business area’s product range is ergonomically

designed surgical workstations adapted for the different surgical spe-

cializations with a maximum overview of the patient, plus integrated

transport solutions for moving patients to and from operating rooms.

To fulfil these criteria, three product lines are offered: surgical tables,

surgical lights and ceiling service units for different types of moni-

toring equipment and delivery of medical gases.

The surgical tables, which are available as mobile or fixed sys-

tems, have been developed for both general and specialized surgery

and therefore contribute to increased efficiency in operating rooms

by allowing a high flow of patients, and thereby efficient utilization

of staff and other resources. Image guided surgery places exacting

requirements on today’s surgical tables, and the business area is at the

forefront in development of x-ray-transparent (screenable) tables

with the AWIGS (Advanced Workplace for Image Guided Surgery)

and VIWAS (Vascular Interventional Workplace for Advanced

Surgery) product systems.

Surgical lights are an integrated part of all operating rooms. The

business area has a wide range of market-leading solutions, includ-

ing a completely new technology that uses gas. This innovation

delivers superior lighting, but with considerably lower energy con-

sumption and heat emission than conventional lights.

Ceiling service units are used to optimise ergonomics and the

overview of the operating room. The service units support the medi-

tech equipment required in the proximity of a surgical workstation,

and deliver medical gases, such as those used in anaesthesia. The busi-

ness area’s products in this product line are also among the absolute

best in the sector. In addition to our wide range of world-leading

products for all lines, the business area provides an extensive techni-

cal service to quickly remedy any problems and faults that may arise,

and thereby help hospital activities run with minimal disruptions.

The market

The global market for surgical tables, surgical lights, and ceilings

service units is valued at SEK 7.4 billion, while the total market for

all surgery-related products and services is many times greater. The

market conditions remain healthy in the US , Japan and Western

Europe and there is currently rapid development in Asia.

The total market value for surgical tables is estimated at SEK 4.2

billion, surgical lights SEK 2.1 billion and ceiling service units SEK

1.1 billion. Market growth is around 5% for surgical tables and lights,

whereas growth for ceiling service units is considerably higher at 10-

15%. The business area’s market share for the three business units is

42% for surgical tables, 39% for surgical lights and 17% for ceiling

service units.

Marketing organization

As our customers have considerable expertise, professional compe-

tence and know-how is paramount for our business area’s marketing

organization. Our sales teams are made up of highly qualified per-

sonnel, whose detailed knowledge of health care, surgery and tech-

nology is combined with a sound businesslike approach.

The business area has its own sales and marketing companies in

Germany, Belgium, the UK, Italy, France, Japan, China, Singapore

and Brazil. Surgical Systems works successfully with the Infection

Control business area to benefit from joint distribution in the US ,

Canada and Australia. For the rest of the world we have a network of

more than 100 distributors and agents.

Representatives of the business area often act in a purely consul-

tative role. In Rastatt, Germany, we have established a Surgical

Academy with a fully equipped operating room and sterilization unit,

which together with the other facilities, such as a large exhibition hall

and a large number of meeting rooms, acts as an international meet-

ing place for surgeons from all over the world.

The technical service we offer is of crucial importance and its aim

is to always be able to offer our customer functional equipment in

order to avoid disruption of their activities.

Activities in 2002

A substantial number of new or improved products were launched

during the year. AWIGS, the advanced system for image guided sur-

gery, can now be combined with tomography scanners from GE and

Siemens. An agreement was signed with Siemens in October that

means the business area can now offer AWIGS to its customers with

tomography scanners from Siemens and General Electric.

A new surgical table for ophthalmic surgery, featuring a fully

motorized cranial support, was launched at Medica held in Germany.

The increasingly clear trend towards obesity among the population in

certain markets has obvious consequences for surgical procedures. In

2002 the business area launched a surgical table – upper weight limit

360 kg – especially designed for overweight patients.

Two new products were launched in 2002 for the surgical lights

product line. Axcel is a new surgical light for the expanding polyclin-

ic surgery market. The world’s first surgical light to use gas, called G8,

was also launched. This world innovation is currently the most

advanced lighting product available for use in surgical procedures.

The ceiling service units product line also gained a new addition

in 2002. The launch of Modulis has given the business area a world-

class service unit.

Trends

The demographic trend towards a growing percentage of elderly peo-

ple in the population is driving demand for cost-effective health care.

Today’s health care is therefore characterised by requirements for

efficiency-enhancing measures. This need is driving development

forwards in terms of technology and organization. A clear example is

the rise of image guided surgery, which has enabled cost-effective,

minimally-invasive surgical procedures. Due to this development,

more operations can be carried out polyclinically, with rapid rehabil-

itation resulting in considerable cost savings. Image guided surgery

also means that diagnostics becomes an integrated part of the surgi-

cal procedure.

Increasingly, hospitals are choosing to purchase from suppliers

that can provide complete product systems, which can be tailored to

specific needs and rapidly adapted for various types of surgical pro-

cedures. Competition between different clinics and hospitals is get-

ting tougher, and investments are being concentrated on profitable

medi-tech equipment that ensures optimal results from operations.

Product positioning

The business area’s products and services are among the best on the

market and are strategically positioned as innovative, process-

enhancing solutions for complete systems of surgical workstations.

Prices are determined by the possibilities of the products, and the

benefits our products and systems give the customer.

Competitors

The business area’s competitors include Mizuho (Japan), Trumpf

(Germany) and Steris (USA) for surgical tables, Berchtold

(Germany) and Steris for surgical lights, and Dräger (Germany) and

Kreuzer (Germany) for ceiling service units.

Several of our competitors have strong international distribution

networks and good, innovative products, but lack Getinge’s broad and

integrated product range.

Prioritised areas for thebusiness area’s product

development are solutions forendoscopy and image guided

surgery, where demand isgreatest.

29

Product development

The development of new products and systems is central for Surgical

Systems, just as it is for the Group’s other business areas. Surgical

Systems is the business area in the Getinge Group with the highest

technical content. Product development for surgical tables is concen-

trated at Rastatt, Germany, and at Ardon, France, for surgical lights

and ceiling service units.

All development takes place in close collaboration with our cus-

tomers and marketing companies, which leads to reality-adapted

product development that is in line with the changes occurring in the

market. Prioritised areas include products adapted for endoscopy and

image guided surgery, where demand is greatest. The most important

aspects of newly developed products are that they promote sound

ergonomics for all the operating room staff, give a good overview of

patients, provide satisfactory patient comfort and actively support the

optimal utilization of the surgical workstation. By meeting these cri-

teria, products positively contribute to the overall economy of the

hospital.

Production

Heræus Med, acquired in Q2 2002, is currently undergoing an exten-

sive rationalization programme. The factory in Hanau, Germany, will

be closed and production of surgical lights and ceiling service units

transferred to Ardon, France. All other production will be concen-

trated at our plant in Rastatt, Germany. This restructuring process is

expected to be fully implemented in 2003. Once completed, it will

lead to considerable improvements in the business area’s competi-

tiveness. In 2002 Getinge signed an agreement for the sale of the sur-

gical table business that was included in the acquisition of ALM. The

buyer of the business is the French company, Fournitures

Hospitalières. After all measures have been carried out, the business

area will have a clear and refined manufacturing structure with table

production concentrated at Rastatt and production of surgical lights

and ceiling service units at Ardon.

Logistics

With around 60% of sales in Western Europe, the business area’s pro-

duction facilities are strategically placed for several of its key mar-

kets. Deliveries to all customers are planned by the business area, but

actual shipment is handled by external transport companies. The aim

is to always provide rapid and correct deliveries, regardless of the

customer’s location.

Surgical System’s production will beconcentrated at Rastatt, Germany and

Ardon, France, during 2003.

Quality

The critical nature of the business area’s products, means there is a

clear focus on quality. The quality system covers functions such as

development, production, delivery and service, and complies with

the requirements for medi-tech products (EN46001:1996, DIN EN

ISO 13485:2001 and DIN EN ISO 9001:1994).

2003 – activities for continued expansion

Sales and marketing

In 2003 the synergies from a joint, global sales organization for all

the business area’s products will become apparent, and the potential

for selling complete installations will be considerably greater. The

developing countries of Asia and the Japanese market have great

prospects for expansion, and will be focused on in 2003. The

American market also offers good prospects for growth in 2003,

above all through the launch of products that are new to this market.

Technology

Work on developing new solutions for operating rooms will be vig-

orously continued in 2003. Polyclinical operations will become more

common, especially in Europe, and differentiation between major

and minor procedures will lead to a corresponding differentiation in

product demand. In 2003 the product range will be adapted to

address this trend.

Continued expansion

During the year, the business area will assess a number of acquisition

possibilities in closely related product areas in order to further broad-

en and strengthen the business area’s position.

WORLD MARKET Product segment Surgical Tables Surgical Lights CSU*Value SEK 4,200 m SEK 2,100 m SEK 1,100 mGrowth, % 5 5 10-15Getinge’s market share, % 42 39 17

MARKET TRENDSOrders received per market 2002 2001 ChangeUSA & Canada 548.7 427.9 28.2%UK 155.5 116.3 33.7%Germany 580.5 590.8 -1.7%Rest of Western Europe 733.6 620.6 18.2%Rest of the world 571.3 507.2 12.6%Business area total 2,589.6 2,262.8 14.4%Changes adjusted for acquisitions and currency-related effects 4.0%

*Ceiling Service Units

SALES PER MARKETWestern Europe: 58%USA & Canada: 20%Asia & Australia: 16%Rest of the World: 6%

SALES PER CUSTOMER SEGMENTAcute health care: 100%

DISTRIBUTIONOwn sales companies: 70%Distributors: 30%

31

SURGICAL SYSTEMS: SUMMARY

32

AWIGS and VIWAS unify diagnosis, operations and result monitoring – for the first time ever

During operations a matter of seconds can

be crucial. Procedures can now be carried

out faster, safer and with less stress, due to

the new, integrated surgical workstations

from Getinge Surgical Systems. AWIGS is a

unique product that enables diagnosis, ope-

rations and monitoring without the risks

associated with the transfer of patients.

AWIGS stands for Advanced Workplace for

Image Guided Surgery.

The AWIGS system comprises of a sur-

gical table and a tomography scanner and

thus combines the two disciplines of surge-

ry and radiology. There are many applica-

tions: AWIGS can be used for neurosurgery

and orthopaedics and for general surgery

and traumatology, as well as face and jaw

surgery. AWIGS is an innovation for opera-

ting rooms as well as emergency depart-

ments.

AWIGS consists of a movable surgical

table with two support pillars and offers the

possibility to manoeuvre the entire screen-

able table into the integrated tomography

scanner.

Studies show that patients are moved as

many as nine times from arrival at the hos-

pital to the completion of the operation.

This not only means considerable physical

strain for the staff, but can also worsen the

patient’s condition. Diagnostic equipment,

emergency rooms and operating rooms are

often so far from each other that valuable

time is lost.

The patient transport system from

AWIGS guarantees more effective logistics

in and around operating rooms: the speciall-

ly developed carrier can take heavy weight

patients and is motorized.

The patient is carefully moved from the

carrier, which can also function as a surgi-

cal table for immediate use, into the tomo-

graphy scanner. If an operation is necessary

right away, it can start without delay on the

integrated surgical table.

AWIGS has not only been designed

with acute care in mind, but also scheduled

surgery. The aim is to enhance efficiency

and improve the quality of care.

Its sister product, VIWAS, (Vascular

Interventional Workplace for Advanced

Surgery) is compatible with AWIGS and has

been developed for surgery, primarily within

the heart and vascular area. The imaging

system can be moved to the table and used.

Operations using VIWAS can be carried out

with continuous imaging in real-time.

VIWAS is sold as a separate system,

but in combination with the AWIGS system,

it is particularly suitable as a complete con-

cept for image guided surgery that offers all

available imaging processes.

AWIGS and VIWAS are already being

used successfully at clinics in Germany,

Switzerland, Austria, Belgium and Japan.

AWIGS & VIWAS – LEADING-EDGE SURGICAL TECHNOLOGY

PRODUCT OVERVIEW SURGICAL SYSTEMS

33

Getinge’s surgical tables are established worldwide via a broad product rangeand unique functionality for general surgery. One of the biggest success fac-tors is the possibility to customize solutions for different types of specializedsurgery, from opthamology to orthopaedics. Surgical tables are always height-adjustable for good ergonomics.There are also extensive options for adapta-tion to various types of surgery in order to create an environment in theoperating room that is as efficient and ergonomic as possible. Getinge’s sys-tems for surgical tables have been developed to provide maximised efficiency

in terms of utilization of the operating room and flexibility for various typesof specialized surgery. The surgical tables consist of a support pillar, which isfixed to the floor of the operating room, and a movable top section. Whileone patient undergoes an operation, the next patient can be prepared for sur-gery.When an operation is completed, the next patient can be taken in as soonas the operating room has been cleaned. In this way, the hospital’s resourcesas utilized to the maximum.

There are two main types of surgical light: one of the solutions is to illuminatethe entire surgical working area with a single light source. This form of surgi-cal light is preferred in the Asian and North American markets, as well as inseveral European countries. The latest lights of this type are equipped withcameras for documentation and detailed imaging. The other type of lighting

solution consists of several lights, which produce an optimal lighting situationin the operating room.This technology is preferred above all in a large num-ber of European countries and is also becoming more popular in the Japanesemarket.This type of light can also be fitted with cameras for documentationand detailed imaging.

Ceiling service units are used both in intensive care and operating rooms. Inintensive care they are used to hold technical equipment that must be inclose proximity to the patient. Medical gases and power supply can be inte-

grated in the ceiling service units. Ceiling service units bring these aids with-in constant reach when needed, but allow them to be simply moved out ofthe way when not in use.

SURGICAL TABLES

SURGICAL LIGHTS

CEILING SERVICE UNITS

34

Infection Control 1998 1999 2000 2001 2002

Orders received, SEK m 2,524.1 2,884.5 2,887.0 3,404.1 3,440.3

Net sales 2,615.7 2,811.1 2,934.6 3,204.3 3,359.3

Share of Group’s net sales, % 60.2% 57.5% 55.9% 39.3% 38.9%

Gross profit 1,028.8 1,084.6 1,142.7 1,142.7 1,215.8

Gross margin, % 39.3% 38.6% 35.7% 35.7% 36.2

Operating costs, SEK m -665.8 -719.3 -821.9 -821.9 -909.9

Operating profit 363.0 365.4 368.5 320.8 305.9

Share of Group’s operating profit 55.6% 52.8% 52.9% 32.9% 29.1%

Operating margin, % 13.9% 13.0% 12.6% 10.0% 9.1%

No. of employees 2,358 2,371 2,327 2,312 2,364

FIVE-YEAR SUMMARY

Business Area Infection Control

35

Review of 2002

2002 was a year which saw growth in line with our aims – 4.8% –

for the business area as a whole. In the US unprofitable product

ranges have been phased out, which has had a short-term negative

effect on orders received, but will have long-term positive effects on

profitability. Despite the lower order intake, underlying demand is

healthy in the American market. There has been a steady upward

trend in the Western European markets during the year with good

growth in Southern Europe, Scandinavia and the UK. However, in

Germany and the Benelux countries, the trend was weaker.

The organization in the US went through major changes in 2002.

A completely new management group was established midway

through the year, and a broad programme of activities was initiated

that includes the phasing out of unprofitable product segments, more

efficient logistics, cost adaptations and a radical restructuring of pro-

duction. Taken together, these measures will lead to considerably

improved profit from the American market in 2003.

The World Sterilizer Project – the business area’s structural pro-

gramme for more cost-effective production – was in all important

respects completed in 2002 and will have a considerable positive

effect on profit in 2003. Work aimed at making production in the US

more efficient will proceed in 2003 and is expected to have a posi-

tive impact on profit in both 2003 and 2004.

The Infection Control business area is the world’s leadingsupplier of sterilizers and disinfectors for the hospitalmarket and the pharmaceutical industry.We sold our firststerilizer in 1932, and today we offer our customers thewidest and most sophisticated range of products andservices on the market.

Our market share is around 25% of the global market,which is estimated at SEK 10 billion.We have a globalmarketing organization with sales in more than 80countries.

ManagementThe Infection Control business area consists of two business units:sterilization and disinfection.The head of product development andproduction is Mats Ottosson. Sales and marketing is coordinated by aglobal marketing organization, which is headed by ChristopheHammer.

Mats Ottosson Christophe Hammer

The business area’s customers are involved in healthcare, industry and the research sector.The commonelement among these different customers is a need tosterilize and disinfect critical goods.

37

Our customers

The Infection Control business area has two main customer cate-

gories: the care sector and industry.

Acute health care and long-term care

Every year, hospital-acquired infections cause a large number of

deaths and untold human suffering. These infections also mean huge

costs, because of consequences such as prolonged care periods and

increases in treatment using antibiotics. An infection that would be a

minor matter for someone who is healthy can cause serious compli-

cations for a sick or elderly person. More patients, resistant bacteria

types and fewer resources within the care sector mean that the prob-

lem is growing. Getinge’s systems aim to prevent contact infections,

i.e. that bacteria or viruses are transferred to patients and staff via

objects such as surgical and dental instruments, bedpans and hand

basins. We thus contribute in an active way to breaking the infection-

route. Our products and services also enable our customers to

become more efficient in their own activities and increase the degree

of control over the flow of sterile and disinfected goods.

The two processes used for critical goods are sterilization and

disinfection. Sterilization kills both active and spore-creating

microorganisms using steam under pressure or gas. Instruments that

require sterilization include surgical and dental instruments as well as

instruments for various types of care. Disinfection kills active

microorganisms, but not spore-creating types. Goods that need to be

disinfected include bedpans, urine bottles and kidney-dishes.

The business area’s systems consist of flusher and washer disin-

fectors for cleaning and disinfection, autoclaves for sterilization, and

tracking and transport solutions for good and safe logistics, as well

as technical service and support. Flusher disinfectors are used for

bedpans and urine bottles on nursing wards. Washer disinfectors are

intended for the cleaning and disinfection of surgical instruments.

Instruments and utensils that are to be sterile are sterilized in auto-

claves.

Today there is an increasing need to be able to plan, control and

document the handling of circulating goods. We have therefore devel-

oped software (T-DOC) that enables the hospital to control its sterile

goods at all times, and therefore achieve effective planning of its activ-

ities. There are other areas that are of utmost importance to our cus-

tomers; the technical service that we provide (a sterilization supply

department must be in continual use) and the consulting services we

can offer, for example in the planning of new sterile supply deparments.

Industry

There is also a need for disinfectors and sterilizers in research and

production, in areas such as the pharmaceutical industry, private and

public research facilities, universities and laboratories. Needs regard-

ing capacity and security levels vary considerably from customer to

customer, and therefore each system is tailored to meet specific cus-

tomer’s unique requirements.

The market

The global market for the business area is valued at SEK 10 billion,

with 6.5 billion for sterilization equipment and 3.5 for disinfection

products. Annual market growth is estimated at 4-5%. Growth in the

disinfection business unit is somewhat higher than in sterilization.

Getinge’s total market share is slightly more than 25%.

Growth is occurring principally in technical service and the after-

market. Among our customer segments, the industry side has higher

growth than health care and long-term care. However, acute health care

remains our biggest customer segment, accounting for 60% of total

sales. The industry side accounts for 30% and long-term care for 10%.

A global marketing organization

Our basic strategy includes a strong ambition to be close to our cus-

tomers. Merely by being in continuous contact, we can understand

their real needs and can thereby adapt and develop our own activities.

As a consequence of this strategic decision, the vast majority of our

sales are made through wholly-owned sales companies, which can

bring back important knowledge to our development and production

facilities. Getinge is represented by its own sales companies in 18

markets, which account for 90% of our sales. Two export offices and

65 distributors cover the rest of the world. Our 200 sales representa-

tives and 600 service technicians give us an important and direct

interface with our customers. In 2002 the work to concentrate mar-

keting on a few brands was completed, as was the establishment of a

homogeneous and global marketing organization. Over 90% of the

business area’s invoiced sales are now made under the Getinge brand,

and marketing resources are being focused to make this brand even

stronger. In the US Infection Control and Surgical Systems have a

joint marketing and sales organization.

Trends

There are some clear trends in the infection control market. We see a

definite trend towards centralization. The number of installations will

be fewer, while the size and complexity or each installation will

increase. The new EU standards for sterilizers and disinfectors will

drive the market forwards, as obsolete equipment must be replaced.

Gradually, as more and more manufacturers meet the new standards,

it is possible that customers will perceive little difference between the

various products on the market. This, together with the fact that hos-

pitals are joining together in different constellations to make pur-

chasing more efficient, is leading to increased downward pressure on

prices. In order to address these trends in an emphatic way, we have

increased our focus on system sales, so that we can clearly differen-

tiate ourselves from our competitors.

The measures that have been taken to heighten the efficiency of our

manufacturing structure have already led to greater competitiveness.

In future we will have a clearer focus on services and knowledge in

order to meet our customers’ total needs regarding infection control.

Product positioning

Products from Getinge are among the absolute best on the market in

terms of function, quality and safety. However, it is being a complete

system supplier with a strong focus on technical service and other

services that is the decisive factor in selecting Getinge as a supplier.

Our products are therefore positioned in the upper price segment,

although adaptations to local conditions must always be made.

Competitors

There is really only one company, Steris of the US , that can measure

up to Getinge in terms of size, broad product range and distribution

network. The company is market-leading in North America regarding

customers in health care, with a market share in the industry segment

comparable to Getinge’s. Of Steris’ total sales, around 85% are to

customers in North America. Other competitors in sterilization are

Belimed in Switzerland and MMM in Germany, Johnson & Johnson

in the US , and Sakura in Japan. Fedegari of Italy is the biggest com-

petitor in the industry segment. In the disinfection product line,

Miele and Meiko of Germany are the main competitors, along with

Steris.

Research and development

The development resources of the Infection Control business area are

organized around the two overall product lines: sterilization products

and disinfection products. Both organizations develop products for

the global market.

Sterilization

Development of the business area’s sterilization products is mainly

carried out in Sweden. The principal resources for development work

are located in Getinge, from where all development work is coordi-

nated. The products are aimed at health care and the pharmaceutical

industry. In recent years, work has focused on the development of

products that are cost-effective to produce and thereby strengthen the

business area’s competitiveness. The clearest example of this work is

the World Sterilizer Project, in which standardization and modulari-

sation of incorporated components unifies cost-effectiveness with

high flexibility for our customers. To add further support to efforts in

this area we carried out a reorganization of our development

resources during the year, and now have a faster throughput rate for

individual development projects. This means we will get our new

products onto the market faster.

Our world sterilizer was successfully launched in 2002, and in

2003 we will introduce a new product range of autoclaves for the

dental market. The autoclaves have been developed according to the

same principles of cost-effectiveness and flexibility. We have also

completed development of a new range of loading equipment – a

clear example of our striving to develop systems in future that not

only provide primary sterilization, but also improve logistics and the

working environment through intelligent ergonomic solutions.

Disinfection

Development of disinfection products – primarily flusher and wash-

Product development will be focused on areas such as effective low-temperature sterilization, point-of-use applications, and solutions that improve logistics and ergonomics.

39

er disinfectors plus systems for loading and unloading goods in large

washer disinfectors – is carried out at the business area’s facilities in

Växjö. Products are aimed at health care, long-term care and the

pharmaceutical industry. During the year development work on a

totally new generation of flusher disinfectors for long-term care insti-

tutions was completed. These will be launched in Q1 of 2003. This

new generation combines cost-effective production and highly effi-

cient disinfection with completely new design possibilities. Our

assessment is that this new product line will strengthen our position

in terms of both market shares and margins. A project was also start-

ed in 2002 that aims to streamline production of our biggest washer

disinfectors.

Production

Production of sterilization products in 2002 was characterised by

major changes in the global manufacturing structure with an overall

aim to make the structure more efficient and thereby improve our

competitiveness. With the launch of the world sterilizer, we have got

a product range of autoclaves for hospitals that is based on a common

platform. This has made it possible to concentrate all essential pro-

duction at our facilities in Getinge. During the year we wound up

production in France and considerably reduced it in the US . This

reshaping of the business area’s manufacturing structure has pro-

ceeded completely according to plan and has required relatively

small investments in machine capacity to meet the increased work-

load at the main plant in Getinge. Viewed over the year, production

in Getinge increased by 45%.

The overall production strategy means that all manufacturing is

done at the main plant in Getinge, which generates cost benefits from

centralization. At the same time, other units are being transformed

into assembly plants for parts supplied from Getinge. This arrange-

ment improves our cost structure, while also enabling us to make

close-to-the-customer market adaptations at the assembly plants and

ensure that our shipments are cost-effective. Assembly plants are cur-

rently located in Australia, UK, Germany, South Africa and the US .

Two other plants produce sterilization equipment: the strongly

niche-oriented facilities in Skärhamn and Denmark. The former

makes autoclaves for the dental market, and the latter units that gen-

erate extremely pure water and extremely pure steam for customers

in industry.

During the year we also analysed and defined our core activities

in production. This review has led to the outsourcing of certain ele-

ments of our manufacturing to various subcontractors.

Production of the range of disinfection products is carried out in

Växjö, as well as Germany and France. The focus is on strong adap-

tation of thin sheet metal, welding and final assembly. External sup-

pliers are used for sub-assembly and surface finishing. The propor-

tion of external manufacturing will grow in future as production vol-

umes increase, in order to optimise our resources and develop our

Production of sterilization products in 2002 wascharacterised by major changes in the global

manufacturing structure with an overall aim tomake the structure more efficient and thereby

improve our competitiveness.

competence within our core areas. Over the next few years, the

degree of automation will gradually increase in sheet metal-work

and welding, which will further strengthen the business area’s com-

petitiveness.

Logistics

The business area has just started a project that aims to make further

improvements in competitiveness by bringing down costs for distri-

bution and administration and reducing tied up capital. The results of

this work will also improve our delivery precision to customers and

enable better control of complex joint deliveries that contain products

from several of the business area’s manufacturing plants. The project

is expected to run throughout 2003 and into 2004.

Quality – working for continuous improvement

Our products are a central and critical part of our customers’ activi-

ties. Great efforts are therefore made to ensure that all phases, from

development work to delivery, are done in a way that is controlled

and repeatable. Design, choice of material and production methods

shall ensure that our products work optimally. The selection of sub-

contractors is also made with great care. However, product quality is

just one of the quality parameters that we use. By being close to our

customers we can continuously develop the service we offer as well

as our knowledge exchange at the Getinge Academy, and learn some-

thing more every day about our customer’s needs and wishes. Their

situations are also constantly changing and this creates new require-

ments that lead to new opportunities for us as a supplier. The busi-

ness area’s manufacturing plants are currently certified in accordance

with ISO 9001, EN 460001 and Annex 2 of the Medical Device

Directive (93/42 EEC). A number of internal measurements are done

in order to follow – and if required, correct – the development of our

customer-supplier relations.

2003 – Activities for increasing competitiveness

A number of measures will be taken in 2003 to further strengthen the

business area’s competitiveness and improve our range of products

and services for customers.

• A critical review of our subcontractors with a clear aim to reduce

their number.

• Implement a feasibility study on the possibility of opening an

assembly plant in China.

• Strengthen our range of products for low-temperature sterilization.

• Continue the efficiency-enhancement of our global manufacturing

structure.

• Continue work to modularise assembly processes.

• Focus on the customer benefits of complete system solutions for

various customer segments.

WORLD MARKET Product segment Sterilization DisinfectionValue SEK 6,500 m SEK 3,500 mGrowth, % 4 5Getinge’s market share, % 24 27

MARKET TRENDSOrders received per market 2002 2001 ChangeWestern Europe 1,546.1 1,465.1 5.5%USA & Canada 1,346.3 1,451.1 -7.2%Asia & Australia 368.4 325.7 13.1%Rest of the world 179.5 162.2 10.7%Business area total 3,440.3 3,404.1 1.1%Changes adjusted for acquisitions and currency-related effects 3.9%

NET SALES PER MARKETWestern Europe:: 46%USA & Canada: 38%Asia & Australia: 10%Rest of the world: 6%

NET SALES PER CUSTOMER SEGMENTAcute health care: 60 %Long-term care: 10 %Industry 30 %

DISTRIBUTIONOwn sales companies: 90 %Distributors: 10 %

41

INFECTION CONTROL: SUMMARY

A well-thought-out flow system is required

if goods handling at a hospital is to achieve

maximum safety and efficiency. Getinge

has an internal team of design and planning

experts, who devise solutions for steriliza-

tion centres and their flow systems. These

systems, which have been tested over

decades with good results worldwide, pro-

vide the greatest economic utilization of the

hospital’s resources, as well as good infec-

tion control.

Getinge has developed special

computerized guidelines relating to the

design and calculation of capacity for vari-

ous types of sterilization units. The detailed

calculations are based on the number of

operations, polyclinical patients, hospital

beds, etc. In this way, it is possible to adjust

the number and size of autoclaves, washer

disinfectors and other equipment to the

needs of each individual hospital. Plans are

created using a CAD system, which can

generate 3-D visualizations that make the

layout of the plan clearer for the end user.

Corresponding systems have been devel-

oped for the laboratory and pharmaceutical

industry customer segments.

With equipment installed in over 100

countries on six continents, Getinge is the

world’s leading supplier of sterilizers and

washer disinfectors to hospitals, the

pharmaceutical industry and laboratories.

The Infection Control business area is

represented in over 80 countries. Due to this

coverage we can offer rapid support to all

our customers around the world.

The basis of all the business area’s

activities is sound knowledge of infection

control and health care. Using this

knowledge we develop our disinfectors and

sterilizers, our documentation systems, and

also our services such as training and

technical service.

Our global success depends to a large

extent on our constant striving to supply

well-thought-out, high-quality systems that

are competitive to the highest degree

regarding aspects such as function,

operational reliability, cost-effectiveness,

ergonomics, environmental considerations

and customer satisfaction.

42

A WELL-THOUGHT-OUT CONCEPT

PRODUCT OVERVIEW INFECTION CONTROL

COMPLETE SYSTEMS

43

GE 606 is a flusher disinfector for

bedpans and urine bottles used in

long-term care.The unique top-

loading version has an ergonomic

design and many applications.

1345 is a table-top machine for

surgical instruments intended for use

at small clinics and dental surgeries.

GE 4656 is a medium-size washer

disinfector with manual loading for

surgical instruments, laboratory

glassware, etc. It offers large capacity

in a compact format and can be

used just about anywhere.

GE 8666 is a large washer

disinfector with manual or automatic

loading. Mainly used for surgical

instruments, laboratory and

pharmaceutical industry goods in

applications where automatic loading

and unloading are desirable for

maximum efficiency.

Lancer PCM – a range of

customized washer disinfectors for

laboratories and industry – customer

segments that demand exceptionally

high standards for cleanness and

quality control.

GE 606 1345 GE 4656 GE 8666 Lancer PCM

FLUSHER AND WASHER DISINFECTORS

HS 11/HS 22 is a table-top

autoclave for small clinics and dental

surgeries. A unique autoclave with

fast processing and safe function

suitable for all types of sterile goods.

HS 33 is a small autoclave for clinics,

surgical departments and

laboratories. A flexible autoclave with

fast processing and many

applications.

HS 66 is a medium-size autoclave

for health care. A highly flexible

machine with large capacity and

many variants to cover all types of

needs, installation variables and

loading procedures (manual or

automatic).

HS 69 Lab is intended for

laboratories and research institutes. A

very competitive standard machine

with many standard options that

cover most of the needs of

laboratories and universities.

Specially adapted production

autoclaves for the pharmaceutical

industry and high-risk laboratories.

Every machine is designed according

to the customer’s specific situation

and needs.

HS 11 / HS 22 HS 33 HS 66 HS 69 Lab Industrial autoclaves

STERILIZERS

T-DOC documentation and tracking

system for increased efficiency and

quality assurance in health care.

Billy is an ergonomic, height-

adjustable utensil trolley for Getinge’s

washer disinfectors and autoclaves.

SL 60 is a new automatic

loader/unloader version for Getinge’s

HS 66 autoclaves.

AGS is a unique automatic utensil

system for Getinge’s GE 8666

washer disinfector.

With good technical service

coverage, Getinge ensures customers

are satisfied.

T-DOC Billy SL 60 AGS Technical service

ACCESSORIES

44

A company that is growing and changing rapidly

Getinge’s development has been very positive since it became a list-

ed company in 1993. The number of employees has grown from

1,000 to 5,600. In 1993 some 20 companies were part of the group,

but by the end of 2002 that number had risen to about 70. A consid-

erable part of this growth is due to the large number of strategic

acquisitions made by the Group. These include Lancer (1994), the

Arjo merger (1995), Castle (1996), Maquet and ALM (2000) and

Heraeus (2002). The Getinge Group currently has production at 20

factories in nine countries, runs active sales operations in over 100

countries, and is represented in all parts of the world.

Opportunities and challenges

The dynamic situation of a global and expansive business offers not

only considerable business opportunities, but also considerable

responsibilities and challenges. We started several initiatives in 2002

aimed at creating an even clearer common corporate culture. A new

group-wide magazine will be published during 2003 in order to give

Group management the means to communicate directly with all

employees. The Group is also working long-term to strengthen

Getinge’s corporate identity.

Ethical principles of the Getinge Group

Working on ethical issues is a continuous task. We established a num-

ber of principles in 2002 to guide this work in the future:

• We work on the basis that all people have equal rights and equal worth.

• With a focus on customers, we will constantly develop through

everyone’s commitment, involvement and cooperation.

• Our attitude shall be based on openness, honesty and a serious

approach.

• We follow the relevant codes of conduct for social responsibility in

order to regulate the company’s and staff’s conduct, both internally

and externally. This conduct complies with regulations, rules and

legislation concerning human rights, equality, diversity, working

environment, business ethics, etc.

Our customers

Obviously, one of our most important interested parties is our cus-

tomers. Getinge’s products and services contribute to considerable

improvements in the working environment – above all in care of the

elderly and disabled – provide efficient and safe handling of sterile

and disinfected goods, and create an ergonomic and efficient work-

ing environment in operating rooms. The continuous development

and improvement of our products and services for our customers is

one of the most important ways that Getinge can contribute to an eas-

ier situation for both patients and employees in the care sector.

Customer contacts and customer surveys create new knowledge

Our customers are one of our most important sources of knowledge.

Every day there is a large number of contacts between Getinge’s staff

and our customers. These meetings often highlight new needs and

new knowledge, which can be utilized to improve our products and

services. It is only through an understanding of our customers’ every-

day work that we can make it easier for them and create more effi-

cient solutions.

The Group initiated a programme of customer surveys in 2002 to

provide a structured way of gathering information on what our cus-

tomers think about our products and services, and what they would

like to see us improve even more.

Getinge in society

As a globally active company, Getinge has considerable responsibilities regarding several

different groups and issues:

• Our customers, who need our products and services in order to run their own activities

• Our employees, who have a right to good working conditions and opportunities to develop

• Our suppliers and their employees

• The environment, in which we all live and on which we all depend

• Our shareholders, who want to see a sound and growing company

• Society in general

We started long-term work during the year that aims to increase awareness and knowledge

of these issues within the company. The clear objectives are to be an attractive company for

our shareholders, attract skilled and dynamic staff, and ensure that our environmental

impact is as small as possible

Product development

The knowledge we obtain from our customers through daily contacts

and customer surveys is used in our product development.

Furthermore, selected customers act as reference individuals in all

highly significant development projects and contribute in a decisive

way to ensure the products that reach the market really are equal to

their tasks.

Environmental work at Getinge – environmental policy

Our ambition is to be the leading company in the sectors in which we

are active. This aim to be the leading company is also very clear in

our strategic long-term environmental work and daily working rou-

tines. The overall environmental objective is to minimize products'

impact on the environment throughout their life cycles, by utilizing

resources efficiently in product development, manufacturing

processes and in operation. In practice this means:

• Environmental considerations are instilled right from the start in

our development activities.

• The use of lifecycle analyses to understand our products' effects

on the environment and optimise the balance between

environmental impact and product performance.

• Continual improvement of our processes and their efficiency.

• Reduced use of raw materials in all processes and promotion of

recycling and the use of recycled materials where it can be

justified for environmental, technical and financial reasons.

• Increased efficiency regarding energy consumption, as well as

sound handling of natural resources within the entire business.

• A good working environment that promotes safety for all our

employees and protects their health.

• Compliance with, and where suitable, exceeding of, requirements

in all applicable environmental legislation, regulations and

guidelines. Local legal requirements will be regarded as a

minimum level.

Environmental management systems

The Group’s overall objective is that all production plants shall be

certified in accordance with ISO 14001 and/or EMAS at the latest in

2004. This work will proceed in 2003, when several more production

facilities will be certified.

Day-to-day environmental work

The Group's products are in many respects complex and contain

many different materials and components. In all development proj-

ects currently in progress, the product is carefully analysed in order

to maximise its recyclability. Recycling stations for manufacturing-

related waste products are now installed at all production companies.

Discharges from the Group's various finishing facilities are far below

permitted levels. Wastewater is purified to a better standard than

The Getinge Group shall activelycontribute towards a better environmentand increased welfare as well as promote

development of a sustainable society.

before it was used. Getinge applies recommended routines for the

handling of new chemicals in production. Old and environmentally-

hazardous chemicals are gradually replaced in order to meet new

environmental regulations. To sum up, Getinge works from the stand-

point of creating the greatest possible benefit at the lowest possible

cost from the financial perspectives of both the company and socie-

ty. Getinge continues to work for a sound holistic view of products

and environmental effectiveness.

Getinge's personnel

Creativity, system solutions, closeness to the customer and good

profitability are key terms within Getinge. To go from intent to action

demands committed and competent staff, which in turn presupposes

continual further education and learning in working life that develops

each employee individually and the Getinge Group as a whole.

Recruitment

The customers we meet include not only representatives for hospi-

tal's, care institution's and industry's purchasing and management

functions, but also patients and residents, and hospital staff and care-

givers of all types. It is in these meetings, face to face, that business

is lost or won. A natural consequence is that matters affecting recruit-

ing, further training and staff development must mainly be run local-

ly on the basis of local conditions, but within the framework of over-

all policies and ground rules.

Competence development and communication

The Getinge Group is decentralized to a large extent, and decisions

are made close to the daily work. Short decision-making paths and a

flat organization lead to a dynamic working environment with great

opportunities for individual employees to realize their ambitions and

ideas. The valuation principle within Getinge is based on respect for,

and trust in, each individual. The underlying view is that taking

responsibility leads to participation and commitment.

As a medi-tech company, Getinge is to a large degree dependent

on capital that stems from confidence in the company. Professional

communication is a prerequisite for building up, maintaining and

improving this capital. Information is therefore an important control

instrument and a manager’s responsibility at all levels of the Group.

Management and staff have a collective responsibility for contin-

uously developing competence as well as deepening and supporting

team spirit in the organization. Employees are offered regular oppor-

tunities for personal development. The Getinge and Maquet

Academies are run within the Group and between 2,000-3,000 cus-

tomers, agents and employees participated in various types of cours-

es in 2002.

The Getinge Group also has contacts with universities and col-

leges in order to bring about an exchange of knowledge and expe-

rience that is beneficial for both parties. This work takes a number of

different forms including a large number of academic papers written

within the framework of the Getinge Group’s activities.

47

V E R K S A M H E T S B E R Ä T T E L S E

2002 2001

Total number of employees on 31 December 5,556 5,330

Number of employees in Sweden on 31 December 877 820

Added value per employee in the financial year, SEK 720,000 690,000

Number of men employed, % 79 80

Number of women employed, % 21 20

Number of employees aged 20-30, % 16 16

Number of employees aged 31-40, % 35 36

Number of employees aged 41-50, % 28 28

Number of employees aged 51-60, % 18 17

Number of employees aged 61-70, % 2 3

Number of employees per business area, %: Infection Control 39 44

Extended Care 30 30

Surgical Systems 31 26

Geographical distribution of employees, %: Sweden 16 16

Rest of Nordic countries 1 1

Rest of Western Europe 52 55

North America 27 24

Eastern Europe 1 1

Asia & Australia 2 2

Africa 1 1

PERSONNEL – AN OVERVIEW

48

Business processes

The Getinge Group’s improved cash flow is the result of long-term,

target-oriented work that encompasses all the Group’s business

processes.

Strategic selection of suppliers and rational production

Internal production has been refined to critical and often knowledge-

intensive core areas, whereas the rest of production has been out-

sourced to subcontractors. At the same time, the number of subcon-

tractors has been reduced and the Group has established central pur-

chasing functions at the business area level. Production has also been

rationalized through concentration at fewer and specialized units, and

significant economies of scale have thereby been achieved.

More efficient administrative processes between

factories and marketing companies

The overall ambition for communication between factories and mar-

keting companies is to create a common, standardized and integrat-

ed platform to make this work as cost-effective and rationalized as

possible. Consequently, 2002 saw the establishing of a group-wide IT

function, which in cooperation with the business areas started on the

task of streamlining the administrative processes between factories

and marketing companies with an aim to makes routines such as pro-

duction planning, order confirmation and invoicing as efficient as

possible. This project is proceeding according to plan and the first

sub-project will be completed in 2003.

Improved logistics function

Logistics projects are under way in all business areas with the objec-

tive to eliminate all intermediate storage at the marketing companies

by establishing direct deliveries from factory to end customer. This

work is proceeding according to plan and in its final form will also

mean centralized and cost-optimised administration.

Deepened customer relations

The Group has also worked very actively to improve contacts with

our customers, so that our deliveries can be managed in a way that is

ideal from the customer’s point of view. This work has involved fre-

quent adjustments and the result has been a considerable improve-

ment in our delivery precision, which has meant a reduction in the

number of days for outstanding receivables.

The combined effect of these measures led to a considerable

improvement in the Group’s cash flow in 2002. There will be an

intensified focus in 2003 on improving cash flow through continued

work on optimising our business processes.

Supplier Factory Marketing company Customer

Strategic supplier work.

Standardized, global IT support.Centralization of administration.

Deeper and more frequent administrative contacts.

Efficient logistics with direct deliveries to customers.

Financial information

Directors’ report ................................................... 50

Financial risk management ................................... 52

Proposed allocation of profits ............................ 53

Consolidated income statement ........................ 54

Consolidated balance sheet ............................... 55

Consolidated cash flow statement ................... 56

Accounting principles............................................ 57

Notes to the consolidated accounts................. 58

Income statement, Parent company .................. 69

Balance sheet, Parent company ......................... 70

Cash flow statement, Parent company ............. 71

Notes to the Parent company accounts .......... 72

Auditors’ report..................................................... 77

The Board................................................................ 78

Group management and auditors ...................... 80

Addresses................................................................. 82

50

Directors’ report

The Getinge Group is active in three business areas. Infection

Control sells disinfection and sterlization equipment that prevent the

emergence and spread of diseases in the health care and long-term

care sectors and in the pharmaceutical and food industries. Extended

Care sells systems for hygiene and lifting for the elderly and dis-

abled and products to prevent and treat pressure sores. Surgical

Systems sells complete systems for surgical workstations, operating

theatres and specialist clinics.

Orders receivedOrders received by the Getinge Group climbed by 4.7% and reached

SEK 8,772.9 million (8,375.7 m). Adjusted for acquisitions and

exchange rate fluctuations, orders received were up by 4.2%.

Sales and profits Net sales climbed by 6.0% to SEK 8,640.1 million (8,148.2 m).

Adjusted for acquisitions and exchange rate fluctuations, net sales

rose by 5.8%. The Getinge Group’s operating profit rose by 7.8% to

SEK 1,049.5 million (974.0 m), which is equivalent to 12.1%

(12.0%) of net sales. Net financial items totalled SEK –173.9 mil-

lion (–223.6 m), of which net interest items made up SEK –169.9

million (–212.0 m). The Group’s profit before tax rose 16.7% to

SEK 875.6 million (750.4 m) corresponding to 10.1% (9.2%) of net

sales.

Tied-up capital The total value of stocks corresponded to 19.0% (21.1) of net sales .

Accounts receivable corresponded to 28.8% (31.9) of net sales.

Capital employed within the Group was SEK 6,528.7 million

(6,592.8 m). The return on capital employed was 15.9% (14.8%).

Goodwill totalled SEK 2,803.6 million (2,768.3 m) at the end of the

financial year.

InvestmentsNet investments in machinery, equipment and buildings, but exclud-

ing equipment for renting out, amounted to SEK 149.6 million

(180.9 m). Investments mainly refer to investments in production

facilities, tools and IT.

AcquisitionsOn 12 June 2002, 100% of the voting rights and capital share of

Heraeus Med Tec situated in Hanau, Germany, were acquired. The

company was included in the Group with effect from 1 July 2002.

Heraeus Med Tec has sales of around SEK 500 million and means a

considerable boost to the business area’s position on the markets for

surgical lights and ceiling service units. In addition to these two

areas of products the company is active in therapy accessories and

gas distribution for operating theatres.

It was announced in August that the business area was consider-

ing closing the facilities in Hanau and moving existing production

for surgical lights and ceiling service units to Ardon, France, while

other production was to be moved to Rastatt, Germany. Structural

costs for moving these production facilities amounts to SEK 257

million (of which SEK 245 million affects cash flow). Heraeus Med

Tec has increased the goodwill by SEK 355 million. Of the net debt

increase as a result of the acquisition amounting to around SEK 300

million, SEK 165 million is for acquisition costs of shares and SEK

130 million is for pension liabilities held by Heraeus upon acquisi-

tion. There is no conditional purchase sum.

Structural reservesAt the end of 2002, the restructuring reserves stood at SEK 253.5

million (148.8 m). The remaining amount is for the largest part for

the continued restructuring of Haraeus Med Tec, which is expected

to be completed during 2003.

Product development Product development is one of the cornerstones of the Group’s

organic growth. Getinge does not intend to perform all development

in-house, and is happy to co-operate with competent external part-

ners. In this way the Group has access to new and commercially

viable technology. Global development is continuously monitored

and a large number of potential projects are evaluated annually.

Acquisition of suitable companies is also a complement to internal

product development.

Environmental issues Four of the Group’s Swedish subsidiaries run production and per-

mit-required activities according to the Swedish Environmental

Code. Permits are valid for the products that each company is

responsible for. Besides a general permit for the engineering indus-

try, permits have also been acquired for spray-painting, transporting

waste and storing bottled gas. The external environmental impact

consists of emissions and discharges into the air and water, as well

as noise from the plants. Production in the US and France moved

during the year to Sweden. Despite this, all of the production facili-

ties’ external environmental impact lies well below the relevant

authority’s and permit requirements. All of the facilities in Sweden

have started to work on obtaining ISO 14001 certification.

TaxesThe Group’s total taxes amounted to SEK 253.9 million (225.1 m),

corresponding to 29.0% (30.0%) of the pre-tax profit. The fact that

the Group’s profit has, in part, been generated by foreign sub-

sidiaries with a higher tax burden explains why the tax burden is

higher than the Swedish corporate tax rate of 28% (see note 8).

Financial position and equity/assets ratioThe Group’s net debt was SEK 3,376.1 million (4,030.0 m) and the

cash flow after investments in tangible fixed assets was SEK 1,061.8

million (-91.0 m).

Shareholders’ equity at year-end was SEK 3,158.2 million

(2,952.9 m) giving an equity/assets ratio of 33.5% (30.8%)

51

PersonnelThere were 5,556 (5,330 ) employees on 31 December 2002, of

whom 877 (820) were employed in Sweden.

The work of the Board and ownership issuesThe Getinge Board consists of seven members, without deputies,

elected by the AGM and two members with deputies chosen by the

employees.

As a complement to the Companies Act regulations and the arti-

cles of association the Board establishes a programme each year for

its work including instructions concerning the division of work

within the Board, division of responsibility between the Board and

the CEO and financial reporting to the Board. The fixed procedures

for the Board were not changed during the year.

During 2002, Getinge’s Board held 7 minuted meetings. The

Board also held a meeting in January 2003 at which the results for

2002 were addressed and thereafter published. The Board addressed

the stated points that were taken up at each Board meeting in accor-

dance with Board procedures such as state of the business, budgets,

annual accounts and interim reports. Furthermore, comprehensive

issues were addressed concerning company acquisitions and other

investments, long-term strategies, structural and organisational

changes. Individual Board members also assisted Group manage-

ment in various strategic issues.

The Board has chosen a remuneration committee from among its

own members for the consideration of terms of employment for cer-

tain executive managers.

The entire Board meets the company’s auditors twice a year. This

takes place at the Board meeting in October, where the scope and

orientation of the audit is determined, and at the Board meeting in

January, where the auditor’s observations from scrutiny of the

Group’s internal controls and accounts are considered. Due to this

procedure, it is considered that there is currently no need for an

auditing committee.

Getinge AB’s nomination procedure is carried out by the chair-

man of the Board annually gathering together the major sharehold-

ers in good time before the general meeting in order to establish the

Board’ composition and working procedures. Due to this procedure,

it is considered that there is currently no need for a nomination com-

mittee.

Effect of exchange rate changes on profitsThe table below indicates the changes, in SEK m, in the income

statement if the exchange rates for 2001 are used instead of the

exchange rates for 2002:

Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . +155.3

Gross profit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . +3.5

Operating profit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -58.9

Sensitivity analysisGetinge’s results are affected by a series of external factors. The

table below shows how changes to some of the important factors

would have affected the Group’s profit before tax in 2002. No con-

sideration is given to the effect of possible compensatory risk man-

agement measures that Getinge applies in accordance with its

established policy.

Change in profit before

tax, SEK m

Price change +/- 1% +/- 86.4

Cost of sold goods +/- 1% +/- 48.2

Salary costs +/- 1% +/- 27.6

Interest rates +/- 1%-point -/+ 25.8

The effect on the Group’s profits before tax of a change in interest

rates of +/- 1 percentage point was calculated based on the Group’s

bank loans at the end of 2002.

Exchange rate fluctuations

The table below indicates the Group’s sensitivity to changes in

exchange rates for SEK against USD, EUR and GBP in 2003. The

effects on profit are expressed in SEK million and shown with the

hedging measures taken by the Group as of January 31, 2003.

(+/-) 2% 5% 10%

USD 2.6 6.6 13.2

EUR 2.9 7.2 14.3

GBP 6.1 15.2 30.4

A change in the currency above against SEK affects profits in the

same direction as the percentage change indicated.

OutlookThe order book had reached a very good level at the end of 2002.

Market conditions for all the business areas are judged to be healthy.

The earnings trend for the Group’s business areas looks good. A sub-

stantial hike in profits is expected for Infection Control.

52

Most of the Getinge Group’s operations are located outside Sweden.

This situation entails exposure to different types of financial risks

that may cause fluctuations in results, cash flow and shareholders’

equity due to changes in exchange rates and interest rates. In addi-

tion, the Group is exposed to refinancing and counter-party risks.

The primary role of the parent company’s treasury unit is to support

business activities and identify the best way of limiting the Group’s

financial risks in line with the Board’s established policy. Getinge’s

financial activities are centralised to benefit from economies of

scale, improve internal control and to facilitate follow-up of risks.

Currency risksExchange rate fluctuations affect the Group’s profits and sharehold-

ers’ equity in different ways:

Transaction exposureSales income and production costs in foreign currencies entail a

transaction risk that affects Group profits. The Group’s flow of for-

eign currencies consists mainly of the income generated by export

sales. The most important currencies are USD, EUR and GBP.

Expected net flow in foreign currency for the coming 6-12

months shall be hedged in its entirety according to the Group’s poli-

cy. Hedging of currency always aims to secure the value of expected

net commercial flows in foreign currencies and occurs mainly with

the help of forward contracts. The diagram shows the Group’s com-

mercial net flow (USD, EUR and GBP) exposed to a transaction

risk, during 2002.

SEK m

1000

900

800

700

600

500

400

300

200

100

0

Conversion risk – income statementWhen converting foreign subsidiaries’ results into SEK currency

exposure occurs, which can, when exchange rates fluctuate, affect

the Group’s profits. In accordance with the Group’s currency policy

exposure arising when consolidating the foreign subsidiaries’ oper-

ating profit is limited by the budgeted operating profit after amorti-

sation of goodwill in USD, EUR and GBP being hedged up to 90%

with the help of forward contracts.

Conversion risk – balance sheetsWhen converting foreign subsidiaries’ net assets into SEK currency

exposure occurs, which can affect the Group’s shareholders’ equity.

To minimise the effects of this conversion the exposure arising shall,

in accordance with the Group’s currency policy, be hedged with

loans or forward contracts in the relevant currency.

Interest rate risksChanges in market interest rates affects the Group’s net interest. How

quickly interest rate changes have an effect on net interest depends on

the fixed interest term of the loans. The financial policy of the Group

states that the fixed interest term in borrowings should be no more

than 2 years. On 31 December 2002 the average fixed interest term for

Group borrowings was around 11.5 months. In order to reduce interest

rate risks and reach the desired fixed interest term for borrowings,

financial instruments, preferably swap agreements, are used.

The Group’s liquid assets are placed on short term deposits with

the aim of excess funds being used to amortize existing loans.

If the average interest rate for currencies represented in the Group’s

borrowings at the end of the year changed momentarily by 1 per-

centage point this would affect profits by SEK +/- 25.8 million on an

annual basis.

Refinancing risks Medium-term committed credit facilities are used to secure future

raising of capital and refinancing of loans falling due. At the start of

2002 the Group had a committed loan facility of USD 200 million

with a group of banks. The agreement matures in the spring of 2004.

During Q1 2002 a further EUR 150 million was secured through the

company signing an agreement for a medium-term loan facility with

a group of banks. This agreement matures in the spring of 2007. In

addition to these credit facilities the Group uses short-term uncom-

mitted credit lines.

Counter-party risks The risk of a counter-party not complying with commitments

according to financial contracts is limited by the choice of credit-

worthy counter parties and limiting involvement to the said party.

The Group’s liquidity is placed on bank accounts and thus has negli-

gible credit risks and the Group’s total counter-party risks in this

case should be considered to be limited.

Debt portfolio per currency 31 December 2002 (countervalue in SEK m)USD .......................................................................................1,031.2

EUR .......................................................................................1,178.3

GBP ............................................................................................60.7

SEK .................................................................................................283.0

Other ...........................................................................................24.7

Total........................................................................................2,577.9

Financial risk management

USD EUR GBP

Fredrik Arp Carl Bennet Bo Damberg

Anders Frick Kerstin Paulsson Mats Wahlström

Bent Carlsen Johan Malmquist Karl-Göran OlofssonChief Executive Officer

Our Auditors’ Report was submitted on 14 March 2003

Mats Fredricson Jan NilssonAuthorized Public Accountant Authorized Public Accountant

Deloitte & Touche AB

53

The following Parent Company earnings are at the disposal of the

Annual General Meeting:

Net profit for the year 214.6

Profit carried forward 300.1

Total 514.7

The Board and the Chief Executive Officer propose that a dividend

of SEK 4.25 should be distributed to shareholders 214.5

that the following sum should be carried forward 300.2

Total 514.7

Proposed allocation of profits

With regard to the Group’s and the Parent Company’s profits and position in general, reference is made to the following Account documents.

Getinge, 14 March 2003

The Group’s unrestricted shareholders’ equity, as per the Consolidated Balance Sheet, totals SEK 1,120.5 million.

54

Consolidated Income Statement

SEK m Note 2002 2001

Net sales 1, 2 8,640.1 8,148.2

Cost of goods sold 3 -4,825.0 -4,574.3

Gross profit 3,815.1 3,573.9

Selling expenses 3 -1,731.5 -1,581.3

Administrative expenses 3 -774.3 -804.2

Research and Development costs 3 -248.2 -217.4

Other operating income 34.3 19.2

Other operating expenses -45.9 -16.2

Operating profit/loss 1, 4, 19, 23,24 1,049.5 974.0

Interest income and similar profit items 5 23.5 19.2

Interest expenses and similar loss items 6 -197.4 -242.8

Profit after financial items 875.6 750.4

Tax on profit for the year 8 -253.9 -225.1

Net profit for the year 621.7 525.3

Earnings per share 7 12.32 10.60

55

Consolidated Balance sheet

SEK m Note 2002 2001

ASSETS

Fixed assets

Intangible fixed assets 4 2,803.6 2,768.3

Tangible fixed assets 4, 19 1,252.5 1,341.0

Shares in associated companies 9 – 2.2

Long-term receivables 43.4 55.3

Deferred tax asset 8 464.4 404.9

Total fixed assets 4,563.9 4,571.7

Current assets

Stock-in-trade 10 1,638.6 1,718.6

Advances to suppliers 5.0 8.3

Accounts receivable 2,489.6 2,597.5

Other receivables 182.9 172.6

Prepaid expenses and accrued income 11 123.2 156.3

Liquid funds 12, 14 412.8 364.4

Total current assets 4,852.1 5,017.7

TOTAL ASSETS 9,416.0 9,589.4

SHAREHOLDERS’ EQUITY, PROVISIONS AND LIABILITIES

Shareholders’ equity 13

Share capital 100.9 100.9

Restricted reserves 1,936.8 1,861.4

Total restricted shareholders’ equity 2,037.7 1,962.3

Unrestricted reserves 498.8 465.3

Net profit for the year 621.7 525.3

Total unrestricted shareholders’ equity 1,120.5 990.6

Total shareholders’ equity 3,158.2 2,952.9

Provisions

Provisions for pensions, interest-bearing 14, 20 1,211.0 1,089.8

Provisions for pensions, non interest-bearing 20 130.7 133.1

Restructuring reserves 15 253.5 148.8

Other provisions 21 347.5 406.6

Total provisions 1,942.7 1,778.3

Long-term liabilities

Interest-bearing long-term loans 14, 19 2,415.3 2,133.5

Other long-term liabilities 26.2 45.9

Total long-term liabilities 2,441.5 2,179.4

Current liabilities

Interest bearing short-term loans 14, 16, 19 162.6 1,171.1

Advance payments from customers 188.9 158.9

Accounts payable 513.9 532.8

Tax liabilities 8 159.1 113.5

Other liabilities 229.5 230.7

Accrued expenses and deferred income 17 619.6 471.8

Total current liabilities 1,873.6 2,678.8

TOTAL SHAREHOLDERS’ EQUITY, PROVISIONS AND LIABILITIES 9,416.0 9,589.4

Pledged assets 18 76.0 70.0

Contingent liabilities 18 167.5 195.9

56

Consolidated Cash flow statement

SEK m Note 2002 2001

Current activities

Operating profit 1,049.5 974.0

Adjustment for items not included in cash flow -2.3 1.0

Depreciation 388.1 367.3

1,435.3 1,342.3

Interest received and similar income 21.3 19.3

Interest paid and similar costs -201.5 -233.1

Taxes paid -232.2 -149.2

Cash flow from current activities before changes to working capital 1,022.9 979.3

Changes in working capital

Stock-in-trade 164.4 -292.2

Rental equipment -32.6 -24.7

Current receivables 328.3 -275.2

Current liabilities -113.5 226.4

Restructuring reserves utilised 15 -158.1 -523.7

Cash flow from current activities 1,211.4 89.9

Investment activities

Acquisitions of subsidiaries 25 -313.3 -450.6

Acquisitions of tangible assets -149.6 -180.9

Cash flow from investment activities -462.9 -631.5

Financing activities

New share issue – 490.1

Change in interest-bearing loans -748.8 324.2

Interest-bearing loans in acquired subsidiaries 25 143.2 133.8

Change in long-term receivables 65.7 -46.3

Dividend paid -189.3 -159.0

Translation differences 29.1 -72.2

Cash flow from financing activities -700.1 670.6

Cash flow for the period 48.4 129.0

Liquid funds at period’s start 364.4 235.4

Liquid funds at period’s end 412.8 364.4

57

Accounting Principles

The accounts have been drawn up in accordance with the Swedish

Annual Accounts Act and the Swedish Financial Accounting

Standards Council’s recommendations and statements.

Amended Accounting PrinciplesOn 1 January 2002, a number of new recommendations came into

force from the Swedish Financial Accounting Standards Council.

These changes are part of an adaptation of Swedish GAAP to the

International Accounting Standards (IAS), now called International

Financial Reporting Standard (IFRS). The recommendations that

came into force in 2002 and which apply to Getinge are

“Consolidated Accounts RR1:00”, “Intangible assets RR 15”,

“Provisions, contingent liabilities, and contingent assets RR 16”,

“Impairment of assets RR 17”, “Borrowing costs RR 21” and

“Related party disclosures RR 23”. When applying the transition

regulations as a result of the above mentioned recommendations

there will be no retroactive effect on Getinge’s accounts for previous

financial years. When applying the new recommendations during the

2002 financial year Intangible assets RR15 and Provisions, contin-

gent liabilities and contingent assets RR16 result in a change to

Getinge’s accounting principles.

Consolidated Accounts Getinge's accounts comprise the Parent Company and all companies

in which Getinge AB owns more than half of the shares’ voting

rights. The accounts have been drawn up in accordance with the

Swedish Financial Accounting Standards Council’s recommenda-

tions.

Companies acquired during the year have been included in the

Consolidated Income Statement from the date of acquisition.

Acquired companies are consolidated in the Consolidated Accounts

in accordance with the acquisition method, which means that the

acquisition value of the shares in subsidiaries is eliminated against

their shareholders’ equity at the date of acquisition. The sharehold-

ers’ equity in the subsidiaries is determined from a market value of

assets, liabilities and provisions at the time of the acquisition. If

required, in accordance with the acquisition analysis, provisions for

restructuring costs are made. Arjo is reported from the 1995 merger

in accordance with the pooling method. An assessment of deferred

tax on acquired untaxed reserves is made in conjunction with the

acquisition. Deferred tax on the difference between the calculated

market values of assets and liabilities and the fiscal residual value is

calculated to the extent that the difference is not included in untaxed

reserves. For cases where the acquisition value of shares exceeds the

acquired shareholders’ equity, calculated as above, the difference is

accounted for as goodwill, which is written off according to plan.

The internal balances and internal profits have been eliminated in

the consolidated accounts. When eliminating internal transactions,

the fiscal effect is also calculated on the basis of rates of taxation

applicable .

Untaxed reserves earned after the acquisition are, in the

Consolidated Balance Sheet, divided into deferred tax liability and

restricted shareholders’ equity, employing the effective rate of taxa-

tion in the respective country.

Foreign currenciesTranslation of foreign activities’ currencyAll foreign subsidiaries are classified as independent. Getinge

employs the current method when converting foreign subsidiary

companies’ Balance Sheets and Income Statements. This means that

all assets and liabilities in subsidiaries are converted at the closing

day rate, while all items in the Income Statements are converted at

the average rate. The translation difference arising in this context is

an effect partly of the difference between the average rates of the

Income Statements and the closing day rates, and partly of the fact

that net assets are converted at a different rate at the end of the year

than at the beginning. Translation differences are not accounted for

in the Income Statement but carried directly to equity.

To reduce the effects that arise when converting foreign sub-

sidiaries it is the company’s policy for the parent company to raise

loans in foreign currencies as a balance against net assets in the for-

eign subsidiaries. The exchange rate differences on these loans, after

deductions for fiscal effects attributable thereto, have been carried

directly to shareholders’ equity in the consolidated accounts.

Receivables and liabilities in foreign currenciesReceivables and liabilities in foreign currencies are valued at the

closing day rates and unrealised exchange rate profits and losses are

included in the results. Exchange rate profits (losses) on operating-

related receivables and liabilities are reported as other operating

income (operating costs). Exchange rate differences regarding finan-

cial assets and liabilities are reported under “Other financial items”.

Future hedged receivables and liabilities have been valued at the

valid forward rate. Advances from customers are booked at the

exchange rates applying when each advance was received, since a

liability to refund is not envisaged.

Hedging of future flowsForward contracts relating to the hedging of future in and out pay-

ments in foreign currency are not market valued at closing day.

Effects arising when prolonging forward currency contracts taken

up to hedge future flows, are booked as assets or debts in the balance

sheet until the currency flows occur and the forward contracts

expire. Due to this principle Getinge reported a debt worth SEK

17.9 million (asset 47.4 m) at the end of the financial year.

Net sales and purchase costs that are hedged are entered in the

income statement at the forward rate.

Revenue recognitionRevenue is included in the accounts principally when all risks and

rights connected with the ownership have been transferred to the

buyer, which usually occurs in connection with delivery, the price

has been set and collection of the receivable is appropriately

secured.

If delivery is postponed at the buyer’s request, but the buyer takes

over the proprietary rights and accepts the invoice, as a “bill and

hold” sale, this will be recognized as revenue at the time when the

proprietary rights are transferred.

Revenue recognition of income normally occurs when the buyer

has accepted delivery and installation and the final inspection has

been carried out. However, revenue is accounted for as soon as

delivery has been carried out if the installation and final inspection

are not of great value. Revenue recognition of services will be at the

rate the services are performed. Revenue from equipment rented out

is allocated to the particular period of the rental agreement.

Tangible fixed assetsTangible fixed assets, mainly consisting of machinery, equipment

and properties, are reported at their acquisition value with deduc-

tions for the accumulated depreciation according to plan.

58

Depreciation according to planDepreciation according to plan is based on the acquisition values of

the assets and their estimated economic lifespan.

DEPRECIATION ACCORDING TO PLAN . . . . . . . . . . . . . . . . . %

Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0

Land improvements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Machines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Production tools . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Equipment for renting out. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

Computer equipment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Consolidated goodwill arising in conjunction with corporate acqui-

sitions is amortised linearly according to the plan drawn up for each

acquisition over their anticipated economic life. For long-term

strategic corporate acquisitions, the amortisation period is 20 years,

for other acquisitions 10 years. Most of the Group’s acquisitions are

strategic.

Intangible fixed assets Research costs burden are expensed as they arise. Development

costs that qualify as intangible fixed assets are activated; other devel-

opment costs are accounted as costs. The criteria for activating

intangible fixed assets during 2002 were not fully fulfilled, which is

why no costs have been activated.

Write-downs When there is indication that an asset has dropped in value its

recyclable value is established. If the recyclable value falls below the

booked value then a write-down of assets is made.

Stock-in tradeStock has been valued at whichever is the lower of the acquisition

value in accordance with the first in/first out (FIFO) principle, and

true value. The stock-in-trade includes a share of indirect costs that

is related to this.

ReceivablesReceivables are reported net after allocation for doubtful debts.

Provisions for uncertain receivables are based on individual assess-

ments of the receivables, taking expected losses into account.

PensionsAll pension commitments not taken over by insurance companies, or

otherwise hedged through funding by an external party, are reported

under liabilities in the balance sheet.

ProvisionsProvisions are defined as liabilities that are uncertain with reference

to amount or timeframe because of an undertaking as a result of an

event that has occurred, it is probable that a flow of resources will be

required in order to regulate the undertaking and that a reliable esti-

mation can be made.

Pensions, deferred tax liabilities, restructuring measures, guaran-

tee commitments and other similar items are recorded as provisions

in the balance sheet.

TaxesAll tax is accounted for in the income statement that is expected to

be paid on the recorded results. This tax has been estimated accord-

ing to each country’s tax regulations and is accounted for under the

item “Taxes”.

Tax legislation in Sweden and certain other countries allows for

allocation to special reserves and funds. Companies can thus, within

certain limits, dispose and retain reported profits without being

immediately taxed. However, the Group shows deferred tax con-

cerning such untaxed reserves.

The consolidated accounts also show deferred tax on the differ-

ence between the booked value and tax value on assets and liabili-

ties. Deferred tax receivables are only accounted for to the extent

that they can probably be utilised within the foreseeable future. To

calculate deferred tax, current tax rates have been used for each

respective country.

LeasingLeasing is classified in the consolidated accounts as financial or

operational leasing. Financial leasing exists where the financial risks

and benefits associated with the ownership in all essential matters

are transferred to the lessee. In other cases it is an operational leas-

ing. For financial leasing the present value of the minimum leasing

charge is accounted, or the actual value if this is lower, as a fixed

asset. The remaining payment liability is reported among liabilities.

Financial agreements for company cars, copying machines and the

like are reported for intangible reasons as operational agreements.

Property rental is included in operational leasing. No significant

leasing agreements have been signed.

Long-term interest-bearing liabilitiesAt the end of 2002 the Group’s long-term interest-bearing liabilities

amount to SEK 2,415.3 million, which in total is within the compa-

ny’s granted mid-term credit facilities of USD 200 million and EUR

150 million, respectively.

59

Notes to the Consolidated Accounts

NOTE 1: NET SALES AND PROFIT PER BUSINESS AREA AND GEOGRAPHIC MARKET, SEK M

Net Sales Operating ProfitGeographic market 2002 2001 2002 2001Nordic region 508.4 448.4 157.3 79.3 Other Western Europe 4,178.5 3,914.9 634.6 590.1 Eastern Europe 217.4 147.0 13.1 6.5 US & Canada 2,761.4 2,709.2 191.0 255.5 Asia, Oceania, Africa, Middle East, Latin America 974.4 928.7 53.5 42.6 Total 8,640.1 8,148.2 1,049.5 974.0

Business AreaInfection Control 3,359.3 3,204.3 305.9 320.8 Surgical Systems 2,520.8 2,223.4 254.9 228.4 Extended Care 2,720.0 2,655.5 487.6 421.3 Other 40.0 65.0 1.1 3.5 Total 8,640.1 8,148.2 1,049.5 974.0

NOTE 2: NET SALES PER INCOME AREA, SEK M

2002 2001

Product sales 7,320.2 6,923.2

Service and installations 1,038.4 938.0

Renting out equipment 281.5 287.0

Total 8,640.1 8,148.2

NOTE 3: DEPRECIATION ACCORDING TO PLAN

Summary 2002 2001

Buildings and land improvements -37.5 -36.2

Machines and other technical plants -56.8 -59.9

Equipment, tools and installations -107.4 -100.2

Rental equipment -21.3 -14.8

Total depreciation, tangible fixed assets -223.0 -211.1

Intangible assets (goodwill) -165.1 -156.2

Total depreciation, fixed assets -388.1 -367.3

Depreciation is recorded as:

Cost of goods sold -116.5 -105.9

Selling expenses -182.8 -177.2

Administrative expenses -79.4 -75.5

Research and development costs -9.4 -8.7

Total -388.1 -367.3

60

NOTE 4: INTANGIBLE AND TANGIBLE FIXED ASSETS

Acquisition value

Value according to 2002 balance sheet

Translation differences

Reclassifications

In new companies on acquisition

Sales/ disposals

Investments

Value according to 2001 balance sheets

IIntangible fixed assets

Goodwill 3,246.0 396.5 -32.4 – – -211.7 3,398.4

Tangible fixed assets

Buildings & land 1,111.8 27.8 -11.5 – – -53.2 1,074.9

Machines & other technical plants 754.9 52.9 -65.5 24.7 -5.3 -38.2 723.5

Equipment, tools and installations 934.4 91.6 -42.0 42.9 -3.5 -60.3 963.1

Rental equipment 249.7 32.6 -48.0 – 10.8 -30.1 215.0

Construction in progress 17.9 0.9 – – -17.4 -0.5 0.9

Advance for tangible fixed assets 4.5 9.3 – – – -0.1 13.7

Total 3,073.2 215.1 -167.0 67.6 -15.4 -182.4 2,991.1

Accumulated depreciation

Value according to 2002 balance sheet

Translation differences

Reclassifications

In new companies on acquisition

Sales/disposals

Depreciation for the year

Value according to 2001 balance sheets

Intangible fixed assets

Goodwill -477.7 -165.1 3.8 -0.5 – 44.7 -594.8

Tangible fixed assets

Buildings & land -405.8 -37.5 16.0 – – 20.7 -406.6

Machines & other technical plants -527.5 -56.8 52.1 -18.0 1.6 30.4 -518.2

Equipment, tools and installations -606.0 -107.4 32.9 -32.1 6.0 35.5 -671.1

Rental equipment -192.9 -21.3 48.0 – – 23.5 -142.7

Construction in progress – – – – – – –

Advance for tangible fixed assets – – – – – – –

Total -1,732.2 -223.0 149.0 -50.1 7.6 110.1 -1,738.6

The total tax assessment value of the Group’s properties in Sweden was SEK 80.9 million (79.3 m) of which 14.3 million (13.7 m)

is for land.

61

NOTE 5: INTEREST INCOME AND SIMILAR PROFIT ITEMS, SEK M

2002 2001

Interest income 10.4 19.2

Currency gain 10.4 –

Other 2.7 –

Total 23.5 19.2

NOTE 6: INTEREST COSTS AND SIMILAR LOSS ITEMS, SEK M

2002 2001

Interest costs -180.3 -231.2

Currency loss – -2.8

Other -17.1 -8.8

Total -197.4 -242.8

Borrowing costs burden profits for the period they are attributable to.

NOTE 7: EARNINGS PER SHARE

The number of shares in the company in 2002 amounted to 50,468,480. A new share issue was carried out at the beginning of

April 2001. For information concerning shares prior to this the bonus issue element in the new share issue is dealt with by a

factor of 0.9717 (corresponding to 46,745,243 shares instead of 45,421,632).The average number of shares in 2001 was

49,537,676.

NOTE 8: TAXES, SEK M

Tax cost: 2002 2001

Actual tax cost -326.4 -226.1

Deferred tax 72.5 1.0

Total tax cost -253.9 -225.1

The relationship between the year’s tax costs and the reported profit before tax

Reported profit before tax 875.6 750.4

Tax according to current tax rate, 28% -245.2 -210.1

Adjustment for tax costs from previous year -29.1 12.6

Tax effect of non tax-deductible costs:

Depreciation of consolidated goodwill -46.5 -43.1

Other non-deductible costs -32.0 -34.8

Non-taxable income 5.4 4.8

Utilized loss carry-forwards 1) 65.9 –

Changed valuation of temporary differences 2) 46.8 75.4

Adjustment for tax rates in foreign subsidiaries -19.2 -29.9

Reported tax cost -253.9 -225.1

1) Not previously activated loss carry-forwards have been utilised during the year due to companies previously recording losses

generated profits during the year and new loss carry-forwards that have arisen 2002, SEK 65.9 m.

2) Structural changes in the Group have meant changed values of temporary differences, SEK 46.8 m.

62

The applicable tax rate has been estimated as the tax rate that applies to the parent company and amounts to 28% for both 2002

and 2001.

Deferred tax receivables relate to the following temporary differences and loss carry-forwards:

Deferred tax receivables relating to: 2002 2001

Deductible temporary differences in provisions 98.2 77.6

Provision for restructuring reserve 32.1 37.4

Loss carry-forward 331.2 314.7

Other deductible temporary differences 198.0 212.3

Deferred tax liabilities relating to:

Taxable temporary differences of fixed assets -8.0 -40.3

Deferred tax on untaxed reserves -97.1 -97.8

Other taxable temporary differences -90.0 -99.0

Deferred tax receivables net 464.4 404.9

The balanced loss carry-forward are judged to be motivated because the companies they relate to are expected to generate

profits in the near future.

Non-reported tax receivables:

Temporary differences 232.4 212.8

Loss carry-forwards 116.8 79.1

Total 349.2 291.9

It has been assessed that the non-reported tax receivables can not be utilised in the foreseeable future.Taxable temporary

differences exist for shares in subsidiaries. Because there are no plans to sell the companies in the foreseeable future the deferred

tax item has not been reported.

NOTE 9: SHARES IN ASSOCIATED COMPANIES, SEK M

Capital shares 2002 2001

Getinge Lunatronic Aps 25% – 2.2

Total – 2.2

A further 50% of the shares in Getinge Lunatronics Aps were acquired in 2002. Because the percentage of voting rights exceeds

50% the company was merged and shares eliminated in the consolidated accounts.

NOTE 10: STOCK-IN-TRADE

2002 2001

Raw materials 773.3 871.8

Work in progress 229.6 231.8

Finished products 635.7 615.0

Total 1,638.6 1,718.6

NOTE 11: PREPAID EXPENSES AND ACCRUED INCOME, SEK M

2002 2001

Accrued income 6.1 28.1

Short-term part of SPP funds 13.5 10.2

Prepaid rental costs 7.1 7.6

Other pre-paid expenses and accrued income 96.5 110.4

Total 123.2 156.3

63

NOTE 12: UNUTILIZED OVERDRAFT FACILITIES AND CREDIT FACILITIES

The granted, unutilized overdraft for the Group was SEK 75.3 million (53.9 m). In addition to this, on 31 December 2002, there

were unutilized short-term credit facilities of SEK 1,034.2 million (996.0 m) and committed, unused facilities which can be utilised

without qualification, of USD 36.9 million and EUR 150, corresponding to SEK 1,704.5 million (590.1 m) at the closing rate of

exchange. A fee is payable for committed credit facilities, usually not in excess of 0.315 % of the unutilised amount.

NOTE 13: THE GROUP’S SHAREHOLDERS’ EQUITY, SEK M

Restricted UnrestrictedShare capital reserves reserves Total

Opening balance 100.9 1,861.4 990.6 2,952.9Dividend – – -189.3 -189.3Net profit for the year – – 621.7 621.7Adjustments – 338.8 -338.8 0.0Translation difference – -263.4 36.3 -227.1Closing balance 100.9 1,936.8 1,120.5 3,158.2

Total translation difference, opening balance 303.2 -64.4 238.8Total translation difference, closing balance 39.8 -28.1 11.7

The main cause for the reduction in the translation difference is the stronger Swedish krona against the USD, EUR and GBP.

Exchange rate differences of hedging instruments in foreign assets have boosted the translation difference by 143.4.

NOTE 14: THE GROUP’S INTEREST-BEARING NET DEBT, SEK M

2002 Change 2001 Change 2000

Current liabilities to credit institutions 162.6 -1,008.5 1,171.1 159.1 1,012.0

Long-term liabilities to credit institutions 2,415.3 281.8 2,133.5 212.0 1,921.5

Allocated to pensions, interest-bearing 1,211.0 121.2 1,089.8 86.7 1,003.1

Less liquid funds -412.8 -48.4 -364.4 -129.0 -235.4

Total 3,376.1 -653.9 4,030.0 328.8 3,701.2

Of the long-term liabilities, SEK 4.1 million (2.7 m) is due for payment in five years or later.

NOTE 15: RESTRUCTURING RESERVES, SEK M

2002 2001

Opening balance, 148.8 558.1

Allocated at acquisition of companies 259.5 85.3

Utilised reserves from corporate acquisitions -158.0 -523.7

Other – 0.5

Exchange rate difference 3.2 28.6

Closing balance 253.5 148.8

Around SEK 60 million (170 m) of 2002’s utilised restructuring reserves does not affect the cash balance. Getinge has chosen to

account for the whole change in the cash flow statement to give an overall picture of the restructuring costs.

The majority of the restructuring reserve will be utilized in 2003.

64

NOTE 16: CURRENT INTEREST-BEARING LOANS, SEK M

2002 2001

Liabilities to credit institutions 162.6 1,171.1

Total 162.6 1,171.1

NOTE 17: ACCRUED EXPENSES AND DEFERRED INCOME, SEK M

2002 2001

Salaries 222.9 128.0

Social security costs 71.1 72.2

Commission 41.9 26.5

Interest expenses 23.8 27.8

Other accrued expenses and deferred income 259.9 217.3

Total 619.6 471.8

NOTE 18: PLEDGED ASSETS AND CONTINGENT LIABILITIES, SEK M

Pledged assets 2002 2001

Property mortgages 9.4 9.6

Floating charges 20.0 –

Assets burdened with retention of title 46.6 60.4

Total 76.0 70.0

Contingent liabilities

Guarantees 161.8 195.9

Other contingent liabilities 5.7 –

Total 167.5 195.9

The assets burdened with retention of title are security for interest-bearing liabilities to credit institutions. Property mortgages and

floating charges have been placed as security for credit not utilized as of 31 December 2002.The guarantees mainly consist of

fulfilling guarantees.The likelihood of outflow is judged to be small.

NOTE 19: LEASING, SEK M

Leasing costs for assets held via operational leasing such as leased premises, machines and mainframe computers and office

equipment are recorded among operating costs and for the Group amount to SEK 83.9 million (the variable cost included is SEK

0.6 million). Future minimal leasing agreements for non-annullable leasing contracts are as follows:

Leasing agreement Financial (present value) Operational

2003 3.8 69.7

2004 - 2007 12.1 119.8

2008 and later 3.9 20.7

Fixed assets held through

financial leasing Buildings & land Machinery & plant Equipment & tools

Acquisition value 50.4 0.9 6.8

Accumulated depreciation -6.5 -0.8 -4.2

Book value 43.9 0.1 2.6

NOTE 20: PROVISIONS FOR PENSIONS

Value according to 2002 balance sheet

Translation differences

Reclassification

Unutilized funds, restored

In new companies upon acquisition

Utilized funds

Provisions

Value according to 2001 balance sheet

Provisions for pensions,

interest-bearing 1,089.8 83.6 -58.2 130.3 – -6.3 -28.2 1,211.0

Provisions for pensions,

non interest-bearing 133.1 0.2 -0.4 – -1.9 2.0 -2.3 130.7

NOTE 21: OTHER PROVISIONS

Warranty provision 69.7 72.8 -43.7 14.9 -6.3 12.7 -4.7 115.4

Other provisions 336.9 188.7 -188.3 24.0 -18.6 -102.5 -8.1 232.1

Total 406.6 261.5 -232.0 38.9 -24.9 -89.8 -12.8 347.5

Other provisions partly consist of a reserve for a kind of part-time pension in the German companies.The sum is determined on

an actuarial basis, 47.6.The remainder consists of many, different, smaller, types of liability whose amount and timeframe are hard to

define.

NOTE 22: AVERAGE NUMBER OF EMPLOYEES

2002 2001

The Group Male Female Total Male Female Total

Australia 65 12 77 62 12 74

Austria 14 2 16 14 2 16

Belgium 36 5 41 22 1 23

Canada 57 15 72 55 14 69

China 13 4 17 7 1 8

Czech Republic 7 2 9 7 2 9

Denmark 65 8 73 55 7 62

Finland 8 2 10 7 3 10

France 458 114 572 508 110 618

Germany 1,121 276 1,397 990 221 1,211

Greece – – – 2 1 3

Holland 106 62 168 109 44 153

Hongkong 7 4 11 7 4 11

Ireland 30 18 48 29 18 47

Italy 68 26 94 66 21 87

Japan 36 11 47 35 8 43

Luxemburg 7 4 11 4 6 10

Norway 12 3 15 12 3 15

Poland 12 5 17 15 4 19

South Africa 22 7 29 22 7 29

Spain 11 7 18 11 13 24

Sweden 730 130 860 731 123 854

Switzerland 13 5 18 13 4 17

UK 579 166 745 579 174 753

USA 885 239 1,124 941 272 1,213

Total 4,362 1,127 5,489 4,303 1,075 5,37865

66

NOTE 23: STAFF COSTS, SEK M

2002 2001

Board Board

and President Other Total and President Other Total

Salaries and remuneration 103.9 2,170.8 2,274.7 80.5 2.076.9 2,157.4

Social security costs 21.1 495.7 516.8 14.1 457.6 471.7

Pension costs 9.2 90.4 99.6 7.2 77.6 84.8

Total 134.2 2,756.9 2,891.1 101.8 2,612.1 2,713.9

Salaries and remuneration per country

2002 2001

Board of which Board of which,

and President bonus Other Total and President bonus Other Total

Australia 1.1 0.3 17.4 18.5 1.0 0.2 15.5 16.5

Austria 0.9 0.2 5.4 6.3 0.7 - 5.8 6.5

Belgium 1.0 – 16.4 17.4 1.0 - 7.5 8.5

Canada 2.1 0.6 21.2 23.3 2.3 0.5 18.4 20.7

China – – 2.5 2.5 - - 1.9 1.9

Czech Republic 0.6 0.2 1.0 1.6 0.5 0.1 0.7 1.2

Denmark 1.9 0.2 32.2 34.1 1.9 0.2 25.7 27.6

Finland 0.8 0.2 2.9 3.7 0.7 0.2 2.7 3.4

France 18.2 3.7 174.8 193.0 8.9 1.7 184.0 192.9

Germany 17.5 5.4 510.5 528.0 11.8 3.7 478.9 490.7

Greece – – – – 0.4 - 0.9 1.3

Holland 6.8 1.7 53.9 60.7 4.0 0.6 47.1 51.1

Hongkong 2.4 0.4 3.7 6.1 2.3 0.4 4.1 6.4

Ireland 1.4 0.5 14.4 15.8 1.3 0.4 13.2 14.5

Italy 2.2 0.7 31.2 33.4 2.3 0.7 25.7 28.0

Japan 3.6 – 23.0 26.6 3.3 0.2 23.3 26.6

Luxemburg 0.8 – 6.7 7.5 3.1 1.4 7.0 10.1

Norway 1.1 0.2 8.2 9.3 0.8 0.1 5.2 6.0

Poland 0.7 0.1 3.7 4.4 0.7 0.1 4.0 4.7

South Africa 0.4 – 2.1 2.5 0.5 - 3.0 3.5

Spain 1.1 – 4.5 5.6 1.8 0.4 4.7 6.5

Sweden 16.8 2.9 249.7 266.5 13.0 1.9 228.5 241.5

Switzerland – – 12.0 12.0 - - 10.9 10.9

UK 12.1 3.2 298.6 310.7 10.9 1.8 294.4 305.3

USA 10.4 2.0 674.8 685.2 7.3 1.4 663.8 671.1

Total 103.9 22.5 2,170.8 2,274.7 80.5 16.0 2,076.9 2,157.4

Remuneration to Senior Management

Principles

The Annual General Meeting decides on remuneration to the Chairman of the Board and its members.There is no specific

remuneration for committee work. Employee representatives do not receive Board remuneration. Remuneration to the CEO and

other senior management is made up in the form of basic pay, variable remuneration, other benefits and pensions. Other senior

management are the 7 people, who together with the CEO, make up the Group management. For management structure see page

80-81.

The division between basic pay and variable remuneration should be in proportion to the manager’s level of responsibility and

authority.The CEO’s variable remuneration is a maximum of 50% of the basic pay. Other managers’ variable remuneration is a

maximum of 25-50% of the total remuneration.The variable part is based on the result in relation to the individually set goals.

There are no benefits or remuneration in the form of financial instruments.

67

Remuneration and other Basic pay/ Variable Other Pension Other Total

benefits during the year, tSEK Board fees remuneration benefits costs remuneration

Chairman of the Board 450 – – – – 450

Board members 1 125 – – – – 1 125

Chief Executive Officer 4 200 1 400 450 1 400 191 7 641

Other senior management* 11 738 7 614 602 2 578 120 22 652

Total 17 513 9 014 1 052 3 978 311 31 868

* 7 people

Comments

• Variable remuneration refers to 2002 financial year’s cost-accounted bonus, paid out in 2003.

For information about bonuses, see below.

• Other benefits refer to company car, house supplied, etc.

• The Chairman of the Board has not received any remuneration other than his Board fee.

The CEO has sickness insurance totalling 24.5% of the pension-based pay between 20-30 basic amounts and 32.5% of the pension-

based pay that exceeds 30 basic amounts.The agreement is independent in relationship to other pension benefits.

Bonuses: The CEO’s bonus for 2002 was based on the individual goals set by the Board.The bonus sum for 2002 was equivalent

to 34% of basic pay. Other senior managers’ bonuses for 2002 were based on a combination of the result of the individual business

area and individual goals.

Pensions: Pension benefits for the CEO, except the applicable ITP pension are as follows:The CEO’s pensionable age is 60. The

pension will be 70% of the pension-based pay between 60 and 65 years. At 65 and thereafter the pension will be 32.5% of the

pension-based pay in excess of 20 basic amounts that the CEO had at age 60 from the company. Pension-based pay is considered

to be the basic pay. Survivor annuity is 16.25% of the pension-based pay in excess of 20 basic amounts.

The pensionable age for other senior management varies between 60 and 65. Pension agreements have been signed in accordance

with the local regulations for the countries in which senior managers are resident. This explains why the pension level varies from

20% to 70% of pension-based pay.

All pension benefits are transferable, i.e. non-conditional of future employment.

Severance pay: If the CEO gives notice, a six-month period of notice applies. If termination of employment is on the part of the

company, the CEO has the right to severance pay during a period of notice corresponding to 12 months. Severance pay is not off-

set against any other income. If termination is on the part of the CEO, there will be no severance pay. Upon termination of

employment of any other executive managers, they have the right to severance pay during a period of notice that is a minimum of

six months and a maximum of 12 months.

Drafting and decision making: During the year the remuneration committee has given the Board its recommendations

concerning remuneration principles for the remuneration of the executive management.The recommendations have included the

proportion between fixed and variable remuneration and the size of possible pay increases.The remuneration committee has also

proposed criteria for deciding bonuses, allocation and the size of the pension conditions and severance pay.The Board has discussed

the remuneration committee’s proposals and decided in line with the remuneration committee’s recommendations. Remuneration

to the CEO for the 2002 financial year has been decided by the Board on the basis of the remuneration committee’s

recommendations. Remuneration to other executive management has been decided by the CEO in consultation with the Chairman

of the Board. During 2002, the remuneration committee met three times.The committee’s work has been carried out with the

support of external experts in issues concerning remuneration levels and structures.

Options scheme for executive management in the US: In January 2000, the US subsidiary introduced a synthetic options

scheme for its executive management.The scheme covers around 20 executives and totals 310,000 options.The scheme runs from

25 January 2000 until 25 January 2005.The options’ exercise price will be calculated as the difference between the initial value of

SEK 94.62 and the Getinge share price in force on the day of the redemption.The guaranteed value has been adjusted from SEK

97.55 to SEK 94.62 due to the bonus share element of the new share issue in 2001.The option holder has the right after each full

year of employment over a five year period to redeem a proportion of the options.The Getinge Group has signed an insurance

contract that fully covers any possible price surge (but not a fall below 94.62) during the options’ duration. Allocation has been

made for payroll overheads.The holders of these options on 31 December 2002 were as follows:

Country Number of options

Executive management of American subsidiary US 80,070

Total 80,070

68

NOTE 23: STAFF COSTS, CONT.

Difference against

Number Exercise date Exercise price guaranteed value, SEK m

66,060 22/2/2002 195.06 6.6

27,696 30/4/2002 187.47 2.6

800 9/7/2002 180.00 0.1

90,213 4/9/2002 171.40 6.9

184,769 16.2

All options available for redemption in 2002 have been utilised.

NOTE 24: AUDITING: FEES AND COMPENSATIONS, SEK M

Fees to Deloitte & Touche AB 2002 2001

Auditing assignments 5.1 –

Other assignments 4.4 –

Fees to Arthur Andersen AB 2002 2001

Auditing assignments – 7.0

Other assignments – 4.9

Fees to Ernst & Young AB 2002 2001

Auditing assignments 2.4 –

Other assignments 1.2 –

Deloitte & Touche is the Company’s auditor. Auditing assignments refer to the auditing of the annual report and accounts, as well as

the Board’s and the CEO’s administration, other assignments that the company’s auditors are required to perform and advice or

other support brought about by observations from auditing or carrying out similar tasks. Other assignments refer mainly to advice

given about auditing and taxation issues plus assistance in connection with corporate acquisitions.

NOTE 25: ADDITIONAL INFORMATION TO THE CASH FLOW STATEMENT, SEK M

Acquisition of subsidiaries 2002 2001

Goodwill 387.6 258.2

Other fixed assets 52.9 99.2

Stock-in-trade 84.4 157.7

Receivables 193.4 204.9

Liquid assets 3.5 41.7

Minority interests – 8.8

Provisions for pension, interest-bearing -170.3 -3.2

Interest-bearing loans -12.9 -130.6

Non interest-bearing liabilities -405.0 -278.2

Paid purchase price 173.6 358.5

Net debt in acquired companies 139.7 92.1

Effect on the Group’s net debt 313.3 450.6

NOTE 26: TRANSACTIONS WITH RELATED PARTIES

Group companies

When supplying products and services between Group companies market conditions and pricing are applied. Inter-Group sales

amounted to SEK 3,545 million for 2002 and SEK 2,774 million for 2001.

69

Income statement, Parent company

SEK m Note 2002 2001

Administrative expenses 1 -45.4 -36.0

Other operating income 0.1 –

Operating loss 1, 16, 17 -45.3 -36.0

Income from participations in Group companies 3 242.1 203.0

Interest income and similar profit items 4 187.7 165.5

Interest costs and similar loss items 5 -186.5 -202.6

Profit after financial items 198.0 129.9

Appropriations 6 3.8 -4.9

Profit before tax 201.8 125.0

Tax on profit for the year 7 12.8 65.0

Profit for the year 214.6 190.0

70

SEK m Note 2002 2001

ASSETS

Fixed assets

Tangible fixed assets 2 23.6 16.7

Shares in Group companies 8 2,902.5 2,879.0

Shares in associated companies 9 – 2.2

Long-term financial receivables 1.1 20.3

Total fixed assets 2,927.2 2,918.2

Current assets

Receivables from Group companies 5,220.8 5,464.5

Other receivables 0.0 0.1

Prepaid expenses and accrued income 10 6.5 6.5

Liquid funds 147.6 105.7

Total current assets 5,374.9 5,576.8

TOTAL ASSETS 8,302.1 8,495.0

SHAREHOLDERS’ EQUITY AND LIABILITIES

Shareholders’ equity 11

Share capital 100.9 100.9

Restricted reserves 2,524.7 2,524.7

Total restricted shareholders’ equity 2,625.6 2,625.6

Profit brought forward 300.1 270.9

Net profit for the year 214.6 190.0

Total unrestricted shareholders’ equity 514.7 460.9

Total shareholders’ equity 3,140.3 3,086.5

Untaxed reserves 1.1 5.0

Long-term liabilities

Interest-bearing long-term loans 2,405.4 2,133.5

Total long-term liabilities 2,405.4 2,133.5

Current liabilities

Interest bearing short-term loans 12 2,707.6 3,221.2

Accounts payable 4.9 4.5

Tax liabilities 7 0.4 5.2

Other liabilities – 0.6

Accrued expenses and deferred income 13 42.4 38.5

Total current liabilities 2,755.3 3,270.0

TOTAL SHAREHOLDERS’ EQUITY AND LIABILITIES 8,302.1 8,495.0

Pledged assets – –

Contingent liabilities 14 34.2 60.2

Balance sheet, Parent company

71

Cash flow statement, Parent company

SEK m Note 2002 2001

Current activities

Operating profit -45.3 -36.0

Depreciation 1 1.9 0.3

-43.4 -35.7

Interest received and similar income 187.7 165.5

Interest paid and similar costs -186.5 -195.5

Payments from participations in Group companies 182.1 51.0

Taxes paid -3.1 -0.8

Cash flow from current activities before changes to working capital 136.8 -15.5

Changes in working capital

Current receivables 0.1 24.0

Current liabilities 3.7 -21.3

Cash flow from current activities 140.6 -12.8

Investment activities

Acquisitions of subsidiaries -31.5 -1.2

Acquisitions of tangible assets 2 -8.8 -12.4

Cash flow from investment activities -40.3 -13.6

Financing activities

New share issue – 490.1

Change in interest-bearing loans -241.8 -232.4

Change in long-term receivables 281.8 -6.2

Dividend paid -189.3 -159.0

Group contributions received from subsidiaries 90.9 38.0

Cash flow from financing activities -58.4 130.5

Cash flow for the period 41.9 104.1

Liquid funds at period’s start 105.7 1.6

Liquid funds at period’s end 147.6 105.7

72

Accounting principles

A statement of Getinge’s accounting principles is found on pages 57-58. Reporting the Group contribution has been in accordance with the

Swedish Financial Accounting Standards Council’s statement. Group contributions are accounted according to the financial consequence.

NOTE 1: DEPRECIATION ACCORDING TO PLAN

Summary 2002 2001

Buildings and land improvements -0.1 –

Equipment, tools & installations -1.8 -0.3

Total depreciation, fixed assets -1.9 -0.3

Depreciation is included as

Administrative costs -1.9 -0.3

NOTE 2: TANGIBLE FIXED ASSETS

Acquisition value

Value according to 2002 Balance sheet

Investments

Value according to 2001 Balance sheet

Tangible fixed assets

Buildings and land 4.3 – 4.3

Equipment, tools & installations 13.7 8.8 22.5

Total 18.0 8.8 26.8

Accumulated depreciation

Value according to 2002 Balance sheet

Depreciation for the year

Value according to 2001 Balance sheet

Tangible fixed assets

Buildings and land -0.4 -0.1 -0.5

Equipment, tools & installations -0.9 -1.8 -2.7

Total -1.3 -1.9 -3.2

NOTE 3: INCOME FROM PARTICIPATION IN GROUP COMPANIES, SEK M

2002 2001

Dividend from Group companies 250.0 203.0

Write-offs of shares in Group companies -7.9 -

Total 242.1 203.0

NOTE 4: INTEREST INCOME AND SIMILAR PROFIT ITEMS, SEK M

2002 2001

Interest income from Group companies 151.8 161.1

Other interest income 6.1 4.4

Currency gains 29.8 –

Total 187.7 165.5

Notes to Parent company accounts

73

NOTE 5: INTEREST COSTS AND SIMILAR LOSS ITEMS, SEK M

2002 2001

Interest costs, Group companies -26.2 -9.6

Other Interest costs -108.5 -150.6

Currency losses -40.4 -37.9

Other -11.4 -4.5

Total -186.5 -202.6

NOTE 6: APPROPRIATIONS AND UNTAXED RESERVES, SEK M

Appropriations 2002 2001

Change to tax allocation reserve 3.9 -4.9

Difference between booked depreciation and depreciation according to plan -0.1 –

Total 3.8 -4.9

Untaxed reserves

Accelerated depreciation 0.2 0.1

Tax allocation reserve 0.9 4.9

Total 1.1 5.0

NOTE 7: TAXES, SEK M

Tax cost: 2002 2001

Actual tax cost 12.8 19.9

Deferred tax – 45.1

Total tax cost 12.8 65.0

The following current tax items relate to items that have been accounted for

directly against shareholders’ equity:

Group contribution 11.1 25.5

The relationship between the year’s tax costs and the reported profit before tax:

Reported profit before tax 201.8 125.0

Tax according to current tax rate, 28% -56.5 -35.0

Adjustment for tax costs from previous year 3.3 –

Tax effect of non tax-deductible costs

Other non-deductible costs -4.0 -1.8

Non-taxable income 70.0 56.7

Changed valuation of temporary differences – 45.1

Reported tax costs 12.8 65.0

Deferred tax receivables relate to the following temporary differences and loss-carry forwards:

Non-reported tax receivables:

Temporary differences -45.1 -45.1

Total -45.1 -45.1

Taxable temporary differences exist for shares in subsidiaries. Because there are no plans to sell the companies in future the

deferred tax item has not been reported.

74

NOTE 8: SHARES IN SUBSIDIARIES

Registered Swedish Number of Book value Book value

Parent company’s holding office company reg. no. shares SEK m 2002 SEK m 2001

Arjo AB Eslöv 556473-1700 23,062,334 2,008.6 2,008.6

Axima Instrument AB Solna 556058-7809 – – 0.3

Getinge Sterilization AB Halmstad 556031-2687 50,000 452.2 452.2

Getinge Aeroplane AB Halmstad 556535-6317 100 0.1 0.1

Getinge Airship AB Halmstad 556535-6309 100 0.1 0.1

Getinge Disinfection AB Växjö 556042-3393 25,000 117.7 117.7

Getinge Letting AB Göteborg 556495-6976 1,000 0.1 0.1

Getinge Skärhamn AB Tjörn 556412-3569 1,000 5.7 5.7

LIC Audio AB Solna 556058-7460 1,000 5.6 5.6

Getinge Australia Pty Ltd Australia 39,500 8.6 8.6

Getinge-Arjo Holding GmbH Austria – – 0.4

Arjo GmbH Austria 1,273 0.4 –

Getinge D.S.E. NV Belgium 600 1.5 1.5

Getinge Sterilizing Equipment Inc Canada 1,230,100 1.3 1.3

Getinge Industries Zhuhai (Ltd) China 1,000 1.1 1.1

Getinge/Arjo A/S Denmark 525 3.3 3.3

Getinge Lunatronic ApS Denmark 399,000 14.6 –

OY Getinge AB Finland 15 – –

Getinge/Arjo France SA France 150,250 216.3 216.3

Getinge & Castle International Ltd Greece 100 1.6 1.6

Getinge Scientific KK Japan 10,000 0.6 0.6

Getinge/Arjo A/S Norway 4,500 5.0 5.0

Getinge Poland Sp Zoo Poland 500 12.7 12.7

NeuroMédica SA Spain 40,000 15.6 15.6

Getinge South Africa (Pty) Ltd South Africa 500 17.1 7.9

Getinge Reinsurance AG Switzerland 2,000 12.7 12.7

Total book value 2,902.5 2,879.0

The parent company’s holding of shares in the subsidiaries constitutes the entire capital and voting rights of the respective

company.

Subsidiaries of sub-Groups:

The Getinge Group, with its business in many countries, is organised into sub-Groups in several categories, and the legal structure

cannot therefore be reflected in a tabular presentation. The following is a list of the companies, which were a part of Getinge’s

sub-Groups as of 31 December 2002. The ownership interest is 100% except in certain cases.The Group’s voting rights and share

of the capital is 76% in Lequeux Algérie. A further 50% of the shares were acquired in Getinge Lunatronic ApS in 2002. After the

acquisition the Group owns 75% of the shares. Due to the basis of the existing agreement for the acquisition of the remaining

25%, these have been taken up as Group interest by entering the expected future redemption price as a liability.

SWEDEN Arjo Ltd Med AB,556473-1718 EslövArjo Holding AB,556402-6663 EslövArjo Hospital Equipment AB,556090-4095 EslövArjo International AB,556528-1440 EslövArjo Scandinavia AB,556528-4600 EslövFjärrbilar Lastbils AB,556496-6728 GöteborgGetinge International AB,556547-8780 HalmstadGetinge Scientific AB,556547-8798 HalmstadGetinge Sverige AB,556509-9511 HalmstadALGERIA Lequeux AlgérieAUSTRALIA Arjo Hosp Equipm Pty Ltd Australia

BELGIUM Arjo Hospital Equipment NV SAMaquet & ALM Belgium N.V.Medibo NVMedibol Holding NVBRAZIL Getinge Brasil LtdaCANADA Arjo Canada IncGestion Techno-Médic IncGetinge/Castle Canada LtdCZECH REPUBLICArjo Hospital Equipment sroDENMARK Getinge-Kemiterm A/SFRANCE ALM SAArjo Equipm Hosp SAFilance SAGetinge Production France SASLancer SNCGetinge France SASPeristel SA

Stérilisation Médical International SAGERMANY Arjo Holding Deutschland GmbHArjo Systeme GmbHGetinge Maquet Germany Holding GmbhGetinge Maquet Verwaltungs GmbHGetinge Produktions GmbHGetinge Van Dijk Medizintechnik GmbHHeræus Med GmbHLancer Industrie GmbHMaquet KGMediKomp GmbHMeditechnik GmbHHONG KONGArjo Ltd Hong KongGetinge/Castle Asia LtdIRELAND Arjo Ireland LtdITALY Arjo Italia SpaGetinge Surgical Systems Italia spaGetinge S.p.A.THE Getinge Service S.p.A.

JAPANArjo Japan KKMaquet-Getinge KKLUXEMBURGArjo International SàrlGetinge Finance SàrlGetinge Luxembourg SàrlNETHERLANDS Arjo Nederland BVGetinge/Arjo Holding Netherlands BVLancer Holland B.V.Medibol Beheer BVMedibol Medical Products BVGetinge B.V.POLAND Arjo Poland Sp.z.o.o.SWITZERLAND Arjo AG SwitzerlandArjo International AGSPAIN Arjo Spain S.A.Getinge Iberica SLUK

Arjo Ltd UKArjo Ltd BranchBuchanan Leasing LtdGetinge Disinfection LtdGetinge Industrier Holding UK LtdGetinge Surgical Systems LtdJames Industries Ltd UKParker Bath LtdPegasus LtdRowan Leasing LtdGetinge UK LtdUS Arjo Inc USAArjo Manufacturing CoArjo USA Inc.Getinge Disinfection IncGetinge/Castle, IncGrand Traverse Technologies IncHeræus Medical IncLancer USA IncPegasus Airwave Inc

75

NOTE 9: SHARES IN ASSOCIATED COMPANIES, SEK M

Capital shares 2002 2001

Getinge Lunatronic Aps 25% – 2.2

Total – 2.2

50% of shares in Lunatronic Aps were acquired in March 2002. After the acquisition the company is no longer considered as an

associated company.

NOTE 10: PREPAID EXPENSES AND ACCRUED INCOME, SEK M

2002 2001

Other prepaid expenses and accrued income 6.5 6.5

Total 6.5 6.5

NOTE 11: PARENT COMPANY’S SHAREHOLDERS’ EQUITY, SEK M

Restricted UnrestrictedShare capital reserves reserves Total

Opening balance 100.9 2,524.7 460.9 3,086.5Dividend – – -189.3 -189.3Group contribution, after deduction for tax effect – – 28.5 28.5Net profit for the year – – 214.6 214.6Closing balance 100.9 2,524.7 514.7 3,140.3

The nominal value of each share is SEK 2.00.The share capital breaks down into 3,375,540 class A shares with 10 voting rights

each, and 47,092,940 class B shares with one voting right each, to make a total of 50,468,480 shares.

Restricted funds consists of a reserve fund of SEK 1,825.1 m and a share premium reserve of SEK 699.6 m.

NOTE 12: INTEREST-BEARING SHORT-TERM LOANS, SEK M

2002 2001

Liabilities to credit institutions – 1,133.0

Liabilities to Group companies 2,707.6 2,088.2

Total 2,707.6 3,221.2

NOTE 13: ACCRUED EXPENSES AND DEFERRED INCOME, SEK M

2002 2001

Salaries 5.1 2.6

Social security costs 2.1 1.6

Interest expenses 23.7 23.7

Other accrued costs and prepaid income 11.5 10.6

Total 42.4 38.5

76

NOTE 14: CONTINGENT LIABILITIES AND PLEDGED ASSETS, SEK M

Contingent liabilities 2002 2001

Guarantees 34.2 60.2

Total 34.2 60.2

The company has left security in the form of general guarantee commitments of a total of SEK 98.4 million (90.1 m) to the

benefit of Group companies, of which SEK 34.2 million (60.2 m) has been utilised.

NOTE 15: AVERAGE NUMBER OF EMPLOYEES

2002 2001

Male Female Total Male Female Total

Sweden 7 3 10 7 3 10

NOTE 16: STAFF COSTS, SEK M

2002 2001

Board Board

and CEO Other Total and CEO Other Total

Salaries and remuneration 7.1 6.7 13.8 5.7 5.9 11.6

Social security costs 2.8 2.7 5.5 2.0 2.6 4.6

Pension costs 1.4 1.7 3.1 0.4 2.0 2.4

Total 11.3 11.1 22.4 8.1 10.5 18.6

See note 23 in Notes to the Group accounts for information concerning remuneration to executive management.

NOTE 17: AUDITING: FEES AND COMPENSATION, SEK M

Fees to Deloitte & Touche AB 2002 2001

Auditing assignments 0.8 –

Other assignments 0.4 –

Fees to Arthur Andersson AB 2002 2001

Auditing assignments – 0.5

Other assignments – 0.4

Deloitte & Touche is the Company’s auditor. Auditing assignments refer to the auditing of the annual report and accounts, as well as

the Board’s and the CEO’s administration, other assignments that the company’s auditors are required to perform and giving advice

or other support brought about by observations from auditing or carrying out similar tasks. Other assignments refer mainly to

advice given about auditing and taxation issues plus assistance in connection with company acquisitions.

NOTE 18: NOTE 18:TRANSACTIONS WITH RELATED PARTIES

See Note 26 in Notes to the Consolidated Account.s

77

Auditors' Report

To the general meeting of the shareholders of Getinge AB (publ)Corporate identity number 556408-5032

We have audited the annual accounts, the consolidated accounts, the

accounting records and the administration of the board of directors

and the managing director of Getinge AB for the year 2002. These

accounts and the administration of the company are the responsibility

of the board of directors and the managing director. Our responsibili-

ty is to express an opinion on the annual accounts, the consolidated

accounts and the administration based on our audit.

We conducted our audit in accordance with generally accepted

auditing standards in Sweden. Those standards require that we plan

and perform the audit to obtain reasonable assurance that the annual

accounts and the consolidated accounts are free of material misstate-

ment. An audit includes examining, on a test basis, evidence support-

ing the amounts and disclosures in the accounts. An audit also

includes assessing the accounting principles used and their applica-

tion by the board of directors and the managing director, as well as

evaluating the overall presentation of information in the annual

accounts and the consolidated accounts. As a basis for our opinion

concerning discharge from liability, we examined significant deci-

sions, actions taken and circumstances of the company in order to be

able to determine the liability if any, to the company of any board

member or the managing director. We also examined whether any

board member or the managing director has, in any other way, acted

in contravention of the Companies Act, the Annual Accounts Act or

the Articles of Association. We believe that our audit provides a rea-

sonable basis for our opinion set out below.

The annual accounts and the consolidated accounts have been pre-

pared in accordance with the Annual Accounts Act, and, thereby, give

a true and fair view of the company’s and the group’s financial posi-

tion and results of operations in accordance with generally accepted

accounting principles in Sweden.

We recommend to the general meeting of shareholders that the

income statements and balance sheets of the parent company and the

group be adopted, that the profit of the parent company be dealt with

in accordance with the proposal in the administration report and that

the members of the board of directors and the managing director be

discharged from liability for the financial year.

Getinge, 14 March 2003.

Mats Fredricson Jan NilssonAuthorised Public Accountant Authorised Public Accountant

Deloitte & Touche AB

78

The Board

Carl Bennet

Fredrik Arp

Bent Carlsen

Bo Damberg

Anders Frick

Leif Holmgren

BOARD MEMBERS

Carl Bennet, born 1951.Chairman of the Board since 1997.Chairman of Boliden, Elanders, HåellsModul-System, Halmstad University, Lifco,Scanrec and Sorb Industri. Member of theBoard of the National Labour Market Board(AMS), SNS (The Swedish Center forBusiness and Policy Studies) and Telia.Other positions: Member of The SwedishGovernment’s Research Advisory Board.Holds 3,375,540 class A and 3,755,031 classB shares via a privately-owned company.

Fredrik Arp, born 1953Member of the Board since 1998.Vice Chairman since 2002.President and CEO of Trelleborg AB.Member of the Board of SSK AB andTrelleborg AB.Holds 1,666 class B shares

Bent Carlsen, born 1948.Representative Member of the Board onbehalf of the Swedish Metalworkers’Union since 2000. Employed by GetingeSterilization AB.Holds 111 class B shares.

Bo Damberg, born 1937Member of the Board since 1999.Director of Handelsbanken Bank.Chairman of Sandrew Metronome ABand the Åhlén Foundation.Member of the Board of the SwedishSecurities Council, Isaberg Rapid AB, theSandrew Foundation and Jan Wallander’sand Tom Hedelius’ foundation.Holds 3,000 class B shares

Anders Frick, born 1945.Member of the Board since 1997.Former President and CEO of Arjo AB.Chairman of the Board of ProstaLund AB.Member of the Board of AB Fagerhult,Nordea Southern Region, Securitas ABand Sweco AB.Holds 9,000 class B shares.

Leif Holmgren, born 1947.Deputy Representative Member on behalfof the Swedish Metalworkers’ Union since1989. Employed by GetingeDisinfection AB.

79

Johan Malmquist Christer Mårdh

Karl-Göran Olofsson

Kerstin Paulsson

Mats Wahlström

Johan Malmquist, born 1961.President and CEO.Employed since 1990.Holds 8,000 class B shares

Christer Mårdh, born 1952.Deputy Representative Member on behalfof the Swedish Union of Clerical andTechnical Employees in Industry, SIF, since2001. Employed by Getinge DisinfectionAB

Karl-Göran Olofsson, born 1957.Representative Member on behalf of theSwedish Union of Clerical and TechnicalEmployees in Industry, SIF, since 2001.Employed by Getinge Sterilization AB.Holds 200 class B shares.

Kerstin Paulsson, born 1963.Member of the Board since 2000.President and partner of Netsoft LundAB. Member of the Board of theFoundation for Knowledge and compe-tency development.

Mats Wahlström, born 1954.Member of the Board since 2000.President of Fresenius Medical Services.Member of the Board of Healthgrade, Inc.and ProstaLund AB.Holds 6,000 class B shares.

80

Group Management and Auditors

Johan Malmquist Ulf Grunander

Heribert Ballhaus

Micael Hedlund

Christophe Hammer

GROUP MANAGEMENT

Johan Malmquist, born 1961.President and CEO.Employed since 1990.Holds 8,000 class B shares

Heribert Ballhaus, born 1952.Vice President business area SurgicalSystems and President of Maquet AG.Employed since 2001.Holds 3,923 class B shares.

Ulf Grunander, born 1954.Chief Financial Officer.Employed since 1993.Holds 5,000 class B shares

Christophe Hammer, born 1958.Vice President business area InfectionControl and President of Lancer S.A.Employed since 1992.

Micael Hedlund, born 1956.Vice President, group logistics andpurchasing. Employed since 2000.

81

Albrecht Knauf Michael Rieder Mats Fredricson

Jan Nilsson

Albrecht Knauf, born 1951.Vice president business area Extended Careand President of Arjo International Employed since 1980.Holds 3,333 class B shares

Mats Ottosson, born 1962.Vice President business area InfectionControl and President of GetingeSterilization AB.Employed since 2001.

Micael Rieder, born 1952.Vice President business area SurgicalSystems. Employed since 2001.

AUDITORS

Mats Fredricson, born 1944.Authorized Public Accountant.Company’s auditor since 1989.

Jan Nilsson, born 1962.Authorized Public Accountant.Deloitte & Touche AB.Company’s auditor since 2000.

Mats Ottosson

AUSTRALIAARJO HOSPITAL EQUIPMENT PTY LTD154 Lytton Road, Bulimba Qld, 4171,E-Mail: info@getinge.com.auPhone: +61 733 956 311 Fax: +61 733 956 712President: Philip McLaughlin

GETINGE AUSTRALIA PTY LTD154 Lytton Road, Bulima Qld, 4171E-Mail: info@getinge.com.auPhone: + 61 733 993 311Fax: + 61 733 956 712President: Philip McLaughlin

AUSTRIAARJO GmbHFöhrenweg 5,Thaur, AT-6065E-Mail: arjo.thaur@arjo.atPhone: +43 522 349 3350Fax: +43 522 349 3350 75President: Robert Deschler

BELGIUMARJO HOSPITAL EQUIPMENT NV/SATernesselei 248,Wommelgem, BE-2160E-Mail: info@arjo.bePhone: + 32 3 353 91 00Fax: + 32 3 353 91 01President: Frank Robeers

GETINGE NVNijverheidsstraat 2,Wommelgem,BE-2160E-Mail: Info@getinge.bePhone: +32 335 428 65Fax: +32 335 428 64President: Dirk De Decker

MAQUET & ALM BELGIQUE N.V.Brusselstraat 182 - 184,Groot - Bijgaarden, BE- 1702E-Mail: maquet@maquet.bePhone: + 32 2 467 85 85Fax: + 32 2 46 33 288President: Luc de Groote

MEDIBO NVHeikant 5, Hamont-Achel, BE-3930E-Mail: info@medibo.comPhone: +32 118 020 40Fax: +32 118 016 26President: Jos Bollen

CANADAARJO CANADA INC1575 South Gateway Road, Unit C,Mississauga Ontario, L4W 5J1E-Mail: info@arjo.caPhone: +1 905 238 7880Fax: +1 905 238 7881President: John Thiessen

GESTION TECHNO-MÉDIC6900 Av. Choquette,St. Hyacinthe/Quebec, G2S8L1E-Mail: administration@techno-medic.comPhone: +1 450 774 7948Fax: +1 450 774 2335President: Pierre Turner

GETINGE/CASTLE CANADA LTD1575 South Gateway Road, Unit C,Mississauga Ontario, L4W 531E-Mail: info@getingecastle.caPhone: +1 905 629 8777Fax: +1 905 629 8875President: Robert Bothwell

CHINAALM/MAQUET CHINAShanghai Representative Office, Room1607,Westgate Tower, No. 1038 WestNanjing Road, Shanghai, 200041E-Mail: t.schlueter@maquet.dePhone: +86 21 6272 3742Fax: +86 21 6272 4279President: H.Ballhaus

GETINGE INTERNATIONAL ABGUANGZHOU OFFICERoom 1808, 18/F, Guanzhou ExchangeSquare, No. 268, Dong Feng Zhong Road510030 GuangzhouE-Mail: info@getinge.com.cnPhone: +86 20 8351 10 65Fax: +86 20 8351 10 66 President: Schilling Luo

CZECH REPUBLICARJO HOSPITAL EQUIPMENT SROStrma 35, Brno, CZ-616 00E-Mail: arjo@arjo.czPhone: +420 5 49 25 42 52Fax: +420 541 213 550President: Milan Sovadina

DENMARKGETINGE-KEMITERM A/SIndustrivej 6-8, Lynge, DK-3540E-Mail: info@kemiterm.comPhone: +45 4816 3333Fax: +45 4818 9104President: Claus Bengtsson

GETINGE DANMARK A/SFirskovvej 23, Lyngby, DK-2800E-Mail: getinge.arjo@get2net.dkPhone: +45 459 327 27Fax: +45 459 341 20President: Ole Mortensen

GETINGE LUNATRONIC APSTordenskjoldsgate 27, Copenhagen K,DK-1055E-Mail: info@T-DOC.comPhone: + 45 33 33 88 55Fax: + 45 33 33 88 70President: Michael Lunau

FINLANDGETINGE FINLAND AbBåtbyggarvägen 18, Helsinki, FI-00210E-Mail: getinge@getinge.fiPhone: +358 968 241 20Fax: +358 968 241 222President: Peter Axberg

FRANCEALMParc de Limère, Avenue de la Pomme dePin Ardon, Orléans, Cedex 2, FR-45074E-Mail: info@alm-sa.frPhone: + 33 2 38 25 88 88Fax: + 33 2 38 25 88 00President: Dominique Lagouge

ARJO EQUIPEMENTS HOSPITALIERS S.A.45, Avenue de l´Europe, Eurocit B.P.133,Roncq Cedex, FR-59346E-Mail: info@arjo.frPhone: + 33 320 281 313Fax: + 33 320 281 314President: Frank Robeers

GETINGE FRANCE SASBP 49, avenue du Canada, ZA deCourtaboeuf, Les Ulis, FR-91942E-Mail: getinge.france@getinge.frPhone: + 33 164 868 900Fax: + 33 164 868 989President: Alain Sayag

LANCER SNC30 Bd de l'Industrie,Tournefeuille,FR-31170E-Mail: lancersite@lancer.frPhone: +33 561 151 111Fax: +33 561 151 616President: Christophe Hammer

PERISTEL SA7, avenue du Canada - BP 49,Courtaboeuf, Cedex, FR-91942E-Mail: getinge.france@getinge.frPhone: +33 1 64 86 89 70Fax: +33 1 64 86 89 75President: Alain Sayag

GERMANYARJO SYSTEME FÜR REHABILITATION GmbHChristof-Ruthhof-Weg 6, Mainz-Kastel,DE-552 52E-Mail: info@arjo.dePhone: +49 6134 186-0Fax: +49 6134 186 209President: Robert Deschler

GETINGE PRODUKTIONS GmbHZechenstrasse 12, Peiting, DE-86971E-Mail: info@getinge-produktion.dePhone: +49 8861 689-0Fax: +49 8861 689-99President: Alfred Heider

GETINGE VAN DIJK MEDIZINTECHNIK GmbHPostfach 1125, Straelen, DE-47628E-Mail: info@getingevandijk.dePhone: +49 283 491 330 Fax: +49 283 491 33 66 President: Harrie Van Dijk

HERAEUS MED GmbHHeraeusstrasse 12-14, Hanau, DE-63450,E-Mail: mailbox@hanau-med.dePhone: + 49 7222 932-0Fax: + 49 7222 932 855President: Heribert Ballhaus

MAQUET GmbH & CO.KGKehler Strasse 31, Rastatt, DE-76437 E-Mail: info.zentrale@maquet.dePhone: +49 7222 932-0Fax: +49 7222 932 855President: Heribert Ballhaus

MEDITECHNIK GmbH - BADE-UNDHILFSSYSTEMEErnst-Befort-Str.4,Wetzlar, DE-355 78E-Mail: info@meditechnik.dePhone: +49 64 41 97 81-0Fax: +49 64 41 9781 50President: Dietmar Klas

HONG KONGARJO FAR EAST LTD1001-03 APEC Plaza, 49 Hoi Yuen Road,Kwun Tong, Kowloon, Hong KongE-Mail: samuelw@arjo.com.hkPhone: +852 2508 9553Fax: +852 2389 5797President: Samuel Wong

GETINGE/CASTLE ASIA LTDRm.1104, 11/F, China AerospaceTechnology Centre 143 Hoi Bun Rd,Kwun Tong Kowloon, Hong KongE-Mail:nancy.see.molina@cnhon.getinge.comPhone: +852 2572 8032Fax: +852 2838 4003President: Dag Leff-Hallstein

IRELANDNorthern IrelandARJO19 Heron Road, Sydenham Business Park,Belfast, BT3 9LEE-Mail: info@arjo.co.ukPhone: +44 - 2890 502000Fax: +44 - 2890 502001President:Trevor Kennedy

Southern Ireland ARJO (IRELAND) LIMITEDB6 Calmount Park, Ballymount, Dublin 12E-Mail: info@arjo.iePhone: +353 1 4565565Fax: +353 1 4565575President:Trevor Kennedy

ITALYARJO ITALIA SPAVia Poggio Verde, 34, Roma, IT-00148E-Mail: promo@arjo.itPhone: +39 066 5 663 56Fax: +39 066 5 663 212President: Silvio Dinale

GETINGE SpAVia Poggio Verde, 34, Roma, IT-00148E-Mail: info@getinge.itPhone: + 39 0665 6631Fax: + 39 0665 663 203President: Silvio Dinale

THE GETINGE SERVICE SpAVia Poggio Verde, 34, Roma, IT-00148E-Mail: info@getinge.itPhone: + 39 0665 6631Fax: + 39 0665 663 203President: Silvio Dinale

MAQUET ITALIA S.P.A.Via Volte n. 54, Cardano al Campo,IT-210 10E-Mail: alm-maquet@gssispa.itPhone: + 39 0331 26 20 66Fax: + 39 0331 26 21 51President: Andreas Kunze

82

Addresses

83

JAPANMAQUET-GETINGE K.K.TFT Building East Wing 8th Floor, 3-1Ariake, Koto-ku,Tokyo, 135-8071E-Mail: info.ig@maquet.co.jpPhone: +81 3 3599 8366Fax: +81 3 3599 8365President:Yuji Maeno

LUXEMBOURGARJO INTERNATIONAL S.À.R.L.11, Route des 3 Cantons,Windhof,LU-8399E-Mail: info@arjo.luPhone: +352 263 070 01Fax: +352 263 07060President: Albrecht Knauf

NETHERLANDSARJO NEDERLAND BVDe Blomboogerd 8, 4003 BX TIELPostbus 6116, HCTiel, NL-4000E-Mail: info@arjo.nlPhone: +31 344 640 800Fax: +31 344 640 885President: Robert Burgers

GETINGE B.V.Fruiteniersstraat 27, P.O. Box 1004 CA Zwijndrecht , NL-3330E-Mail: info@getinge.nlPhone: + 31 78 6102 433Fax: + 31 78 6101 582President: Ronald J.A. van Franck

LANCER HOLLAND B.V.Postbus (P O Box)33, ZG Wamel,NL-6659E-Mail: sales@lancer.nlPhone: +31 4875 18088Fax: +31 4875 17978President: Karel N Rietveld

MEDIBOL MEDICAL PRODUCTS BVPeperstraat 3-5,Valkenswaard,NL-5554 EGE-Mail: info@medibol.comPhone: + 31 4020 44 296Fax: +31 4020 19183President: Jos Bollen

NORWAYGETINGE NORGE ASEnebakk vn. 117, Oslo, NO-0680E-Mail: info@getinge.noPhone: +47 23 05 11 80 /+ 47 982 811 50Fax: +47 23 05 11 99President: Arne Corneliussen

POLANDGETINGE POLANDUl. Lirowa 27,Warsaw, PL-02-387E-Mail: office@getinge.plPhone: +48 22 88 20 626Fax: +48 22 882 06 28President: Jerzy Bartos

SINGAPOREMAQUET S.E.A.No. 20 Bendermeer Road, Unit 06-01/02,Singapore, 339914E-mail: sales@maquet-sg.comPhone: +65 6 296 1992Fax: +65 6 296 1937President: Heribert Ballhaus

SPAINARJO SPAIN S.A.Calle San Rafael n 6, Alcobendas, Madrid,ES-28108E-Mail: arjo.spain@eresmas.netPhone: +34 91 49 00 636Fax: +34 91 49 00 637President: Frank Robeers

GETINGE IBERICA SLC/ San Rafael, 6. Nave 8, Pol. Ind. deAlcobendas, Alcobendas , Madrid,ES-28108E-Mail: getinge.france@getinge.frPhone: +34 91 661 10 15Fax: +34 91 661 10 42President: Alain Sayag

SOUTH AFRICAGETINGE SOUTH AFRICA (PTY) LTDP O Box 48492, Hercules,Pretoria, SA, 0002E-Mail: getinge@mweb.co.zaPhone: +27 12 372 1370Fax: +27 12 372 1282President: Des Collins

SWEDENARJO HOSPITAL EQUIPMENT ABP O Box 61, Eslöv, SE-241 21E-Mail: info@arjo.sePhone: +46 413 645 00Fax: +46 413 64 583President: Albrecht Knauf/Johan Kåreby

ARJO SCANDINAVIA ABP O Box 61, Eslöv, SE-241 21E-Mail: info@arjo.sePhone: +46 413 645 00Fax: +46 413 64 583President: Jan Löfving

GETINGE ABP O Box 69, Getinge, SE-310 44E-Mail: info@getinge.comPhone: +46 35 15 55 00Fax: +46 35 15 56 40President: Johan Malmquist

GETINGE DISINFECTION ABP O Box 1505,Växjö, SE-351 15E-Mail: info.disinfection@getinge.comPhone: +46 470 77 98 00Fax: +46 470 208 32President: Roland Karlsson

GETINGE INTERNATIONAL ABP O Box 69, Getinge, SE-310 44E-Mail: info@getinge.comPhone: + 46 35 15 55 00Fax: + 46 35 16 63 92President: Harald Castler

GETINGE SKÄRHAMN ABIndustrivägen 5, Skärhamn, SE-471 31E-Mail: info@seska.getinge.comPhone: +46 304 60 02 00Fax: +46 304 60 02 29President: Gert Linder

GETINGE STERILIZATION ABP O Box 69, Getinge, SE-310 44E-Mail: info@getinge.comPhone: + 46 35 15 55 00Fax: + 46 35 549 52President: Mats Ottosson

GETINGE SVERIGE ABP O Box 69, Getinge, SE-310 44 E-Mail: info@getinge.comPhone: + 46 35 15 55 00Fax: + 46 35 549 52President: Peter Olsson

LIC AUDIO ABP O Box 603, Upplands Väsby, SE-194 26E-Mail: info@licaudio.sePhone: +46 8 590 00 450Fax: +46 8 590 00 490President: Claes Lund

SWITZERLANDARJO AGFlorenzstrasse 1D, Postfach,Basel, CH-4023E-Mail: arjo.sic@arjo.chPhone: +41 61 337 97 77Fax: +41 61 373 11 00President: Robert Deschler

ARJO INTERNATIONAL AGFlorenzstrasse 1D, PostfachBasel, CH-4023E-Mail: info2@arjo.chPhone: +41 61 317 97 97Fax: +41 61 373 11 00President: Albrecht Knauf

UNITED KINGDOMARJO LTDSt. Catherine Street, Gloucester, GL1 2SL,E-Mail: jan.mercer@arjo.co.ukPhone: + 44 1452 428 200Fax: + 44 1452 428 337President: Andy Gould/Mark Harwood

GETINGE SURGICAL SYSTEMS UKColima Avenue, Hylton Riverside,Sunderland,Tyne & Wear, SR5 3XEE-Mail: info@getingesurgical.co.ukPhone: + 44 191 516 9669Fax: + 44 191 516 9662President: Andrew Cserey

GETINGE UK LTDOrchard Way, Calladine Park,Sutton-In-Ashfield , Notts, NG 17 1JU E-Mail: sales@getinge.co.ukPhone: +44 1623 510 033Fax: +44 1623 440 456 President: Stephen Parrish

PARKER BATH LTDQueensway, Steam Lane Industrial Estate,New Milton, Hampshire, BH25 5 NNcustomer.services@parkerbath.co.ukPhone: + 44 1425 624031Fax: + 44 1425 624019President: Neil Carden

PEGASUS LTDPegasus House,Waterberyy Drive,Waterlooville, Hampshire, PO7 7XXE-Mail: custserv@pegasus-uk.comPhone: + 44 23 92 784200Fax: + 44 23 92 78442President: Nicholas Bracey

USAARJO INC.50 N. Gary Avenue, Roselle, IL 60172E-Mail: administrator@arjousa.comPhone: +1 630 3076123Fax: +1 630 307 6195President: Ross Scavuzzo

GETINGE INTERNATIONAL AB – LATINAMERICA OPERATIONS8280 NW 27th Street, # 511, MiamiFL 33122Phone: + 1 305 447 9144Fax: + 1 305 447 9979President: Harald Castler

GETINGE SOURCING LLC1777 East Henrietta Road, Rochester,NY 14623-3133E-Mail: info@getingeusa.comPhone: + 1 585 475 1400Fax: + 1 585 272 5033President: John Aymong

GETINGE USA, INC.1777 East Henrietta Road, Rochester,New Work, 14623-3133E-Mail: info@getingeusa.comPhone: + 1 585 475 1400Fax: + 1 585 272 5033President: Charles E. Carrier

HERAEUS MEDICAL USA6764-A Preston Avenue, Livermore,CA-94550Phone: +1 925 371 4155Fax: +1 925 371 5929President: Charles E. Carrier

LANCER SALES USA INC3543 State Road 419,Winter Springs,FL 32708E-Mail: sales@lancer.comPhone: +1 407 327 8488Fax: +1 407 327 1229President: James Fry

PEGASUS AIRWAVE INC791 Park of Commerce Blvd,Boca Raton, FL-33431 E-Mail: administrator@arjousa.comPhone: +1 561 989 9898Fax: +1 561 989 9640President: Ross Scavuzzo

Getinge AB (publ.)P.O. Box 69, SE-310 44 Getinge, Sweden

Phone: +46 35 15 55 00Telefax: +46 35 549 52

info@getinge.comwww.getinge.com