Annual Report 2010
Governance
Finance Financial reporting aligned with new organizational structure The new structure of the AO Organization— with its three pillars of the Specialties, Service Units and Support Units—was fully reflected during the whole 2010 financial year. Financial Overview Overall, the operating result amounted to -26 million CHF in 2010 compared to -22 million CHF in the previous year. With a financial result of 5 million CHF, the net result amounted to -21 million CHF. Consequently, the Foundation’s equity decreased 2% to 962 million CHF by the end of 2010. AO Financial Overview 2009 abs.
2010 abs.
Variance 10/09 abs.
Operating Income Operating Expenses Operating Result Financial Result Net Result
66 88 -22 58 36
70 96 -26 5 -21
5 9 -4 -53 -57
Equity per 31.12.
982
962
-21
in million CHF
Operating expenses grew by 10% versus the previous year to 96 million CHF. Taking into account the 10% decrease in spending in 2009 versus 2008, the compounded annual growth rate from 2007 to 2010 is 1%. 6%
3% 2% 18%
7%
AO Foundation Contribution Cooperation & Support Agreement Contribution Asset Management Change in Reserves Third-party Income Total Income R&D Reference Centers and Fellowships Technical Commissions Education Community Development General and Administrative Global and Regional Boards Others
Total Expenses
50
82 56 5 21 14 96 27 5 3 32 6 14 6 3
96
237 FTE
96 million CHF
14%
53%
27% 28%
Expenses by main activity Education R&D General and Administrative Community Development Global and Regional Boards Reference Centers and Fellowships Technical Commissions Others Edu RD
Gen
Gen
2010 Actual in million CHF
Full-time Equivalents
33%
CommDev
Profit & Loss Statement 2010 AO Total
2%
7%
Edu
Operating income increased by 7% versus 2009. It includes the income from the Cooperation Agreement with Synthes of 56 million CHF (+8% versus previous year) and other third party income amounting to 14 million CHF (+5% versus previous year).
Employees The number of employees increased by ten full-time equivalents (FTEs) versus 2009 and reached a level of 237. Overall 26 employees were fully dedicated to regional activities.
Global
33% 28% 14% 7% 7% 6% 3% 2%
2010 in %
International * Asia Pacific Europe * Latin America Middle East * North America
211 8 4 9 1 4
89% 3% 2% 4% 1% 1%
Total
237
100%
*
Employee Overview (Full-Time Equivalents by year-end) Service Units Specialties Support Units Others incl. Exploratory Research
year end
International, Middle East and Europe are based in Switzerland
126 63 43 5
service
Total
Others
237
Spec Support Units Others
The spending for educational activities had the biggest stake with 33% of total expenses. Overall 618 AO courses took place in 2010 with almost 35,000 course participants globally. AO Course Activities 2010
Trauma Spine
263
Operating Room Personnel
107
Asset Management With an actual return of 0.4% on the underlying financial assets, the financial result was 5.4 million CHF below the benchmark of 3.4%. The total asset value amounted to 898 million CHF by the end of 2010. The underperformance was driven by the negative performance of the Synthes stake, with a 32% share in the portfolio. Excluding the Synthes position, the portfolio achieved a return of 4% well in line with the benchmark. Looking at the Foundation’s portfolio performance since January 2007, the total actual return amounted to -4.2% versus the benchmark of -9.6% for the same period.
115 9%
Craniomaxillofacial
73
Socio Economic Committee
34
Veterinary
26
12%
898 million CHF 20%
Total Courses Total Course Participants Total Participant Days
618 34,852 99,709
59%
Financial Assets Portfolio Structure in million CHF Shares Bonds Liquidity Alternative assets Total
531 177 108 82 898
51