Leo Holding A/S

Development in activities and financesThe LEO Foundation holds financial assets worth approximately DKK 16 billion. Funds are invested to generate the best possible returns while retaining a sensible, well-balanced risk profile, which enables the Foundation to be a stable and supportive owner of LEO Pharma and to enhance its philanthropic support for scientific purposes.

2022 followed the path laid out in previous years and in the investment strategy for 2022, with a steady build-up of a diversified portfolio of illiquid alternatives. In 2022, this meant four new commitments – totalling more than DKK 1.7 billion – to a real estate fund and five private equity funds. Return and capital calls during 2022 meant that the allocation to illiquid alternatives increased by more than DKK 900 million. On the listed side, an emerging markets debt hard currency index mandate was terminated and, importantly, all listed mandates, including index mandates, are now subject to ESG screening.

Major transactions on existing mandates in 2022 included adjustments of the equity weighting using equity index futures and ETFs as well as a reduction in fixed-income exposure to cover investments in alternatives as well as grant payouts and operating costs.

LEO Holding’s financial portfolio generated a negative return of DKK 1,626 million or -9.2%, with equities, credit, and government and mortgage bonds being detractors, while alternatives and overlay strategies contributed positively.

At the end of 2022, LEO Holding’s financial portfolio consisted of equities 47% (2021: 47%), government and mortgage bonds 8% (2021: 15%), credit bonds 17% (2021: 18%) and alternatives 29% (2021: 20%).

Income from investments in affiliates after tax was a loss of DKK 3,234 million (2021: loss of DKK 4,131 million). For more information on LEO Pharma Group, please refer to LEO Pharma A/S’ Annual Report.