1.6 Balance sheet and capital expenditure

1.6.1 Capital expenditure

In 2018, the tangible capital expenditure resulting from UCB biopharmaceutical activities amounted to € 94 million (2017: € 100 million). The 2018 capital expenditures related mainly to other plant & equipment.

Acquisition of intangible assets reached € 247 million in 2018 (2017: € 109 million) and is related to in-licensing deals, software and capitalized eligible development costs. In 2018, the main acquisitions are related to € 132 million for the acquisition of midazolam acquired from Proximagen and the final € 33 million milestone related to Dermira for the clinical program designed to evaluate the efficacy and safety of Cimzia® in adult patients with moderate-to-severe chronic plaque psoriasis.

In addition, as foreseen in the agreement between UCB and Lonza for the manufacturing by Lonza of PEGylated antibody fragment-based bulk active compounds, UCB has participated in the pre-financing of the related capital expenditure. Depreciation charges on this investment are recognized in the cost of goods sold and are added back for recurring EBITDA calculation purposes.

1.6.2 Balance sheet

The intangible assets increased by € 53 million from € 817 million at 31 December 2017 to € 870 million at 31 December 2018. This includes the ongoing amortization of the intangible assets (€ 170 million), partially offset by additions from the Proximagen acquisition, Dermira milestone, software and capitalized eligible development costs.

Goodwill at € 4 970 million, up € 132 million, stemming from the acquisition of Element Genomics (€ 22 million) and a stronger U.S. dollar compared to December 2017.

Other non-current assets increased by € 139 million, driven by property, plant and equipment following right of use asset recognition following the implementation of IFRS 16.

The current assets increase from € 2 677 million as of 31 December 2017 to € 2 950 million as of 31 December 2018 and relates to higher commercial and development inventory and increased cash positions.

UCB’s shareholders’ equity, at € 6 255 million, showed an increase of € 519 million between 31 December 2017 and 31 December 2018. The important changes stem from the net profit after non-controlling interests (€ 800 million), the cash-flow hedges (€ -141 million), the U.S. dollar and British pound currency translation (€ 66 million), the dividend payments (€ -222 million) and the acquisition of own shares (€ -38 million).

The non-current liabilities amounted to € 2 021 million, a decrease of € 211 million mainly due to early repayment of long-term loan and transfer of Bonds to current liabilities.

The current liabilities amounted to € 2 238 million, up € 289 million, impacted by changes in financial instruments and higher trade payables.

The net debt decreased by € 288 million from € 525 million as of end December 2017 to € 237 million as per end December 2018, and mainly relates to the underlying net profitability, offset by the acquisition of assets, the dividend payment on the 2017 results and the acquisition of own shares. The net debt to recurring EBITDA ratio for 2018 reached 0.17 after 0.38 for 2017.