EX-99.1 2 a06-16001_1ex99d1.htm EX-99

Exhibit 99.1

For Immediate Release

Media Contact:

Investor Contact:

July 12, 2006

Bo Piela

Sally Curley

 

617-768-6579

617-768-6140

 

Genzyme Reports Second-Quarter Financial Results

Delivers Solid Earnings Growth Based on Strong Top-Line Performance

CAMBRIDGE, Mass.—Genzyme Corp. (Nasdaq: GENZ) today reported a 19 percent increase in second quarter revenue, driven by growth across all major product areas. Revenue rose to $793.4 million from $668.1 million in the second quarter a year ago.

GAAP net income increased to $134.5 million, or $0.49 per diluted share, compared with $123.6 million, or $0.46 per diluted share, in the second quarter last year. GAAP net income includes a $42.0 million net gain in equity securities, principally reflecting the tender of Genzyme’s investment in Cambridge Antibody Technology Group plc, which is being acquired by AstraZeneca plc. GAAP earnings also include stock compensation expenses, which amounted to $55.3 million after taxes, or $0.20 per diluted share, and were higher than in the first quarter because they reflect the impact of Genzyme’s annual broad-based stock option grant in May. GAAP earnings for the second quarter of last year do not include stock compensation expenses.

Non-GAAP net income increased 22 percent to $181.2 million, up from $149.0 million in the same quarter a year ago, and non-GAAP earnings increased 19 percent to $0.68 per diluted share from $0.57 per diluted share. Non-GAAP figures exclude one-



time items, amortization, stock compensation expenses, dilution from contingent convertible debt, and the impact of FIN 46.

 “We had a strong quarter with excellent progress throughout the business, including solid results in the three product areas that were below expectations in the first quarter,” said Henri A. Termeer, Genzyme’s chairman and chief executive officer. “We are on track to meet our financial goals for the year, while also meeting our commitment to the future by continuing to invest in late-stage clinical trials, manufacturing expansion, and product launches.”

Genzyme reiterated its full-year revenue guidance of $3.1 to $3.3 billion, its GAAP earnings guidance of $1.78-$1.88 per diluted share, and its non-GAAP earnings guidance of $2.65-$2.75 per diluted share.

Product Sales

Within the Renal division, revenue for Renagel® (sevelamer hydrochloride), a phosphate binder for patients with end-stage renal disease on hemodialysis, grew 26 percent to $126.6 million, up from $100.8 million in the same period last year. Renagel’s growth is being driven by the communication of strong clinical data, improved access to the product through the Medicare Part D program, development of international markets, and the expanded U.S. commercial organization.  Genzyme looks forward to the publication later this year of clinical results from the DCOR study and the presentation of health economic data from this study at the American Society of Nephrology meeting in November.

The expanded U.S. commercial organization is also helping to drive the growth of Hectorol® (doxercalciferol), which treats secondary hyperparathyroidism in patients on dialysis and those with earlier stages of chronic kidney disease. Hectorol sales in the

2



second quarter were $22.4 million, compared with sales of $18.9 million in the first quarter. Genzyme has begun to implement the global commercialization strategy for Hectorol it envisioned when it acquired the product last July.  During the quarter, it submitted a marketing application for the product in Argentina, and filings in Mexico and Israel are expected to follow later this year.  The company is planning clinical studies to facilitate Hectorol’s registration in Europe and to reinforce its position in the United States.

Within the Therapeutics area, sales of Fabrazyme® (agalsidase beta) enzyme replacement therapy for Fabry disease grew 20 percent in the second quarter to $89.0 million, compared with sales of $74.4 million in the same quarter last year. Fabrazyme’s growth was driven by the number of new patients beginning therapy. Sales increased 11 percent from the first quarter.

Sales of Cerezyme® (imiglucerase for injection) enzyme replacement therapy for Type 1 Gaucher disease were $254.0 million, 8 percent greater than sales of $236.0 million in the second quarter a year ago.

Sales of Aldurazyme® (laronidase) enzyme replacement therapy for patients with MPS I were $23.5 million in the second quarter, a 23 percent increase from sales of $19.2 million in the same quarter last year. Aldurazyme is marketed through an increasingly profitable joint venture with BioMarin Pharmaceutical Inc.

Sales of Myozyme® (alglucosidase alfa) were $6.5 million in the second quarter.  In April, the product was approved in the United States for the treatment of all patients with Pompe disease. Myozyme was launched in the United States in mid-May, and the product is also being introduced in a growing number of European Union countries following European Commission approval at the end of the first quarter. Genzyme is

3



making excellent progress in securing reimbursement approvals both for patients with the infantile and the late-onset forms of Pompe disease. Myozyme sales are expected to increase throughout this year as patients transition from clinical trials or expanded access programs and as new patients are identified.  Genzyme anticipates that sales will begin to have a material impact on the company next year. Marketing applications for Myozyme have been submitted in Japan and Canada, and Genzyme expects to file for approval in several additional countries in the coming months.

Sales of Thyrogen® (thyrotropin alfa for injection) rose to $23.7 million in the second quarter, a 15 percent increase from sales of $20.7 million during the same period a year earlier.

Within the Biosurgery area, sales of Synvisc® (hylan G-F 20) increased 8 percent compared with the second quarter of last year, rising to $63.6 million from $58.8 million, driven by the expanding market for viscosupplementation products. Product sales increased 19 percent from the first quarter of this year, reflecting seasonal trends and the impact of an expanded sales and marketing investment. Synvisc is indicated for the treatment of knee pain caused by osteoarthritis. Data from an independent study were presented last month at the annual congress of the European League Against Rheumatism that provide further evidence to differentiate Synvisc clinically from competing products. The study results showed that patients receiving Synvisc experienced a greater magnitude and duration of pain relief than those receiving Hyalgan® (sodium hyaluronate). Similarly, Synvisc patients experienced significantly better functional outcomes and higher levels of satisfaction than those receiving Hyalgan.

4



 

Sales of Sepra™ products grew 28 percent to $22.0 million, up from $17.1 million in the second quarter a year ago. This growth was driven partially by the increasing use of Seprafilm® adhesion barrier in major gynecologic procedures, including oncologic surgery and Cesarean sections.

Within the Transplant area, combined sales of Thymoglobulin® (anti-thymocyte globulin, rabbit) and Lymphoglobuline™ (anti-thymocyte globulin, equine) were $39.8 million, up 19 percent compared with $33.6 million in the second quarter last year. These products are used in conjunction with immunosuppressant drugs to treat acute rejection in renal transplant procedures.

Total revenue for the Diagnostics/Genetics business increased to $87.3 million in the second quarter, 14 percent greater than revenue of $76.5 million in the same period last year. During the quarter, Genzyme Genetics introduced two new molecular tests that may enable physicians to better manage patients with acute myelogenous leukemia.

Other revenue—including oncology revenue, sales of pharmaceutical intermediates, and royalties from sales of WelChol® (colesevelam hydrochloride)—increased 30 percent to $40.1 million from $30.9 million in the second quarter last year.

Oncology revenue was $13.7 million, an increase of 41 percent compared with $9.7 million in the same quarter last year. Oncology revenue includes profits and royalties from Campath® (alemtuzumab), which is marketed by Schering AG and its U.S. affiliate Berlex; sales of Clolar® (clofarabine for intravenous infusion); and R&D revenue.

Expenses

Selling, general and administrative expenses were $220.4 million, excluding the impact of stock compensation expenses and FIN 46. Non-GAAP SG&A spending was

5



approximately 28 percent of revenue, down from 29 percent in the same period a year ago.

Non-GAAP research and development spending in the second quarter was $138.6 million, or 17 percent of revenue, excluding the impact of stock compensation expenses and FIN 46. Non-GAAP R&D spending in the same quarter last year was $115.3 million, or 17 percent of revenue.  The reconciliation from GAAP to non-GAAP R&D and SG&A expenses is included on the accompanying chart.

Genzyme is conducting more late-stage trials now than at any point in its history. New products and new product indications are expected to expand and further diversify the company’s portfolio and contribute to its long-term growth. Clinical development program highlights for the second quarter include the following:

·                  Enrollment is more than two-thirds complete in the phase 3 trial of tolevamer, a novel non-absorbed polymer therapy that could be the first non-antibiotic treatment for Clostridium difficile-associated diarrhea, a widespread and growing global problem affecting patients in hospitals and nursing homes. The trial is scheduled for completion next year. Regulatory submissions are scheduled to begin late next year, and the first commercial approval is anticipated in 2008.

·                  Preparations are underway for the initiation of a phase 3 study of alemtuzumab (Campath) for the treatment of relapsing/remitting multiple sclerosis, which is expected during the second half of this year.  In addition, nearly all participating patients have now completed at least 24 months in the ongoing Phase 2 clinical trial comparing alemtuzumab with Rebif® (interferon beta-1a) for the treatment of multiple sclerosis. Genzyme expects to release data in the second half of this year from a two-year interim analysis of this three-year study.

·                  Progress continues to be made within the sevelamer carbonate development program. A study evaluating the product’s equivalence to Renagel has been completed and results are being analyzed. Genzyme has also begun a study evaluating the potential of sevelamer carbonate to benefit patients with chronic kidney disease who are not on dialysis, and a study comparing a powder form of sevelamer carbonate dosed once a day to Renagel tablets dosed three times a day. Such a formulation could provide an additional option to increase patient compliance.

6



 

·                  The clinical study of Myozyme involving patients with late-onset Pompe disease is fully enrolled and will continue throughout this year. The 90-patient trial is intended to provide further support for Myozyme’s use. Results will be available early next year and will be submitted to regulatory authorities.

·                  Advances continue within the clinical program designed to extend the use of Synvisc to the hip, shoulder and ankle, and to introduce new formulations of the product. Genzyme expects to launch Synvisc for use in the hip in the United States during the first half of 2007. The company is also conducting pivotal trials of Synvisc 2 and hylastan, potential next-generation viscosupplementation products that are designed to increase patient convenience by reducing the number of injections required for treatment. Enrollment has been completed in the trial of Synvisc 2, and Genzyme is planning for product launch next year in Europe and the United States, depending on the outcome of the trial.

·                  Genzyme is working to broaden the indications for its oncology products, Campath and Clolar, to benefit larger patient populations. A phase 3 trial comparing Campath with chlorambucil in previously untreated patients with progressive B-cell chronic lymphocytic leukemia (B-CLL) may demonstrate the product’s efficacy as a first-line agent. Encouraging interim results from this study, focusing on the study’s secondary endpoint, were presented at the Annual Meeting of the American Society of Clinical Oncology in June. They showed that patients who received Campath exhibited significantly higher overall and complete response rates, with a manageable safety profile, compared with chlorambucil patients. The interim results also showed statistically significant higher response rates to Campath in patients with certain cytogenic abnormalites that are typically associated with poor prognosis. Data from the study’s primary endpoint of progression-free survival are expected by the end of the year, when Genzyme and development partner Schering AG expect to submit U.S. and European applications to expand the product’s current label to include first-line treatment of B-CLL patients.

·                  Genzyme is seeking to expand Clolar’s indication to include adult patients.  Enrollment is expected to begin shortly in a phase 3 study evaluating Clolar’s use in combination with existing therapies for adult patients with acute myelogenous leukemia. Additional late-stage studies are also planned to support Clolar’s use in older patients. The product is currently indicated for the treatment of pediatric patients with relapsed or refractory acute lymphoblastic leukemia after at least two prior regimens.

·                  In the lysosomal storage disease area, enrollment is expected to begin in the coming weeks in an international, multi-center phase 2 clinical trial evaluating the safety and efficacy of the small molecule GENZ-112638 for the treatment of Gaucher disease. The trial will help determine the potential of this compound as an alternative or adjunct to enzyme replacement therapy. GENZ-112638 also may be applicable to several other lysosomal storage disorders in addition to

7



Gaucher disease. Initiation of the phase 2 program follows completion of an extensive pre-clinical research effort and a phase 1 program that involved more than 120 subjects in three separate studies.

About Genzyme

One of the world’s leading biotechnology companies, Genzyme is dedicated to making a major positive impact on the lives of people with serious diseases. This year marks the 25th anniversary of Genzyme’s founding. Since 1981, the company has grown from a small start-up to a diversified enterprise with more than 8,000 employees in locations spanning the globe and 2005 revenues of $2.7 billion. Genzyme has been selected by FORTUNE as one of the “100 Best Companies to Work for” in the United States.

With many established products and services helping patients in more than 80 countries, Genzyme is a leader in the effort to develop and apply the most advanced technologies in the life sciences. The company’s products and services are focused on rare inherited disorders, kidney disease, orthopaedics, cancer, transplant and immune diseases, and diagnostic testing. Genzyme’s commitment to innovation continues today with a substantial development program focused on these fields, as well as heart disease and other areas of unmet medical need.

This press release contains forward-looking statements, including statements regarding 2006 earnings, revenues, EPS, and product sales estimates; expected drivers of Genzyme’s future growth, as well as the growth drivers for certain products, including Renagel, Hectorol, and Myozyme; the ability of our molecular tests to help physicians better manage treatment for patients with AML; the development of new markets and seeking additional approved indications and uses for Genzyme’s products, including Hectorol, Myozyme, Synvisc, Campath and Clolar; anticipated progress of clinical trials, including those for tolevamer, alemtuzumab MS, sevelamer carbonate, Myozyme, hylastan, Synvisc 2, Clolar and GENZ-112638; publication of results from the DCOR trial; the anticipating timing of Synvisc 2 launch; and other statements regarding Genzyme’s future performance and strategy. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those forecast in these forward-looking statements. These risks and uncertainties include, among others, Genzyme’s ability to successfully complete preclinical and clinical development of its products and services; Genzyme’s ability to expand the use of current products in existing and new indications; Genzyme’s ability to maintain and obtain regulatory approvals for products and services, and the timing of receipt of such approvals; Genzyme’s ability to successfully identify and market to new patients; the scope of third-party reimbursement coverage for Genzyme’s products and services; Genzyme’s ability to successfully expand its sales and marketing teams in existing and new markets; Genzyme’s ability to manufacture products and product candidates in a timely and cost effective manner; the ability to manage patient safety and the continued administration of alemtuzumab to MS patients following clinical hold release; Genzyme’s ability to develop and obtain approval of a patient safety plan for alemtuzumab MS; failure of Genzyme’s molecular tests to produce diagnostic results as anticipated; and the risks and uncertainties described in Genzyme’s SEC reports filed under the Securities

8



Exchange Act of 1934, including the factors discussed under the caption “Factors Affecting Future Operating Results” in Genzyme’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2006. Genzyme cautions investors not to place substantial reliance on the forward-looking statements contained in this press release. These statements speak only as of July 12, 2006 and Genzyme undertakes no obligation to update or revise the statements.

This press release includes certain non-GAAP financial measures that involve adjustments to GAAP figures. Genzyme believes that these non-GAAP financial measures, when considered together with the GAAP figures, can enhance an overall understanding of Genzyme’s past financial performance and its prospects for the future. The non-GAAP financial measures are included with the intent of providing both management and investors with a more complete understanding of underlying operational results and trends. In addition, these non-GAAP financial measures are among the primary indicators Genzyme management uses for planning and forecasting purposes. These non-GAAP financial measures are not intended to be considered in isolation or as a substitute for GAAP figures. In addition, gross margin figures exclude amortization of product-related intangible assets.

Genzyme®, Renagel®, Hectorol®, Fabrazyme®, Cerezyme®, Thyrogen®, Synvisc®, Myozyme®, Thymoglobulin®, Clolar® and Campath® are registered trademarks and Sepra™ and Lymphoglobuline™ are trademarks of Genzyme Corporation or its subsidiaries. WelChol® is a registered trademark of Sankyo Pharma Inc. Aldurazyme® is a registered trademark of BioMarin/Genzyme LLC. Hyalgan® is a registered trademark of Sanofi Aventis. Rebif® is a registered trademark of Serono, Inc.

Conference Call Information

There will be a conference call today at 11:00 a.m. Eastern to discuss Genzyme Corporation’s financial results for the second quarter of 2006. If you would like to participate in the call, please dial (706) 679-8722. This call will also be Webcast on the investor events section of www.genzyme.com. A replay of the Webcast call will be available from 2:15 p.m. Eastern today through midnight on July 19. For the call, please dial (706) 645-9291 and refer to reservation number 7981370.

Upcoming Events

Genzyme will announce its financial results for the third quarter of 2006 on October 12, 2006.  There will be a conference call to discuss these results at 11:00 a.m. Eastern. If you would like to participate in the call, please dial (706) 679-8722. The call will also be Webcast live on the investor events section of www.genzyme.com.  A replay of the Webcast call will be available from 2:15 p.m. Eastern through midnight on October 19, 2006.  For the call replay, please dial (706) 645-9291 and refer to reservation number 1650276.

# # #

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Genzyme’s press releases and other company information are available at www.genzyme.com and by calling Genzyme’s investor information line at 1-800-905-4369 within the United States or 1-703-797-1866 outside the United States.

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GENZYME CORPORATION (GENZ)

Consolidated Statements of Operations

 

Three Months Ended

 

Six Months Ended

 

(Unaudited, amounts in thousands, except per share amounts)

 

June 30,

 

June 30,

 

 

 

2006

 

2005

 

2006

 

2005

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

$

793,356

 

$

668,139

 

$

1,524,198

 

$

1,298,088

 

 

 

 

 

 

 

 

 

 

 

Operating costs and expenses:

 

 

 

 

 

 

 

 

 

Cost of products and services sold(1)

 

185,333

 

145,250

 

352,283

 

291,343

 

Selling, general and administrative(1)

 

273,480

 

196,385

 

504,149

 

378,224

 

Research and development(1)

 

168,941

 

121,726

 

321,264

 

236,471

 

Amortization of intangibles

 

52,883

 

40,105

 

105,575

 

81,291

 

Purchase of in-process research and development(2)

 

—

 

—

 

—

 

9,500

 

Total operating costs and expenses

 

680,637

 

503,466

 

1,283,271

 

996,829

 

Operating income

 

112,719

 

164,673

 

240,927

 

301,259

 

 

 

 

 

 

 

 

 

 

 

Other income (expenses):

 

 

 

 

 

 

 

 

 

Equity in income (loss) of equity method investments

 

3,854

 

(417

)

6,100

 

(2,135

)

Minority interest

 

2,750

 

3,357

 

5,196

 

5,551

 

Gain on investments in equity securities(3)

 

66,967

 

4,817

 

74,909

 

4,958

 

Other

 

(319

)

253

 

(458

)

193

 

Investment income

 

12,563

 

7,544

 

22,641

 

14,162

 

Interest expense

 

(4,035

)

(4,466

)

(8,473

)

(8,274

)

Total other income (expenses)

 

81,780

 

11,088

 

99,915

 

14,455

 

Income before income taxes(1)

 

194,499

 

175,761

 

340,842

 

315,714

 

Provision for income taxes(1)

 

(60,002

)

(52,130

)

(105,371

)

(96,525

)

Net income(1)

 

$

134,497

 

$

123,631

 

$

235,471

 

$

219,189

 

 

 

 

 

 

 

 

 

 

 

Net income per share of Genzyme Stock:

 

 

 

 

 

 

 

 

 

Basic

 

$

0.52

 

$

0.49

 

$

0.91

 

$

0.87

 

 

 

 

 

 

 

 

 

 

 

Diluted(1,4)

 

$

0.49

 

$

0.46

 

$

0.86

 

$

0.83

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

Basic

 

260,444

 

253,086

 

260,076

 

252,003

 

 

 

 

 

 

 

 

 

 

 

Diluted(1,4)

 

276,312

 

270,084

 

276,560

 

268,988

 

 

 

 

 

 

 

 

 

 

 

(1)             Reflects the adoption of Financial Accounting Standards Board, or FASB, Statement of Financial Accounting Standards No., or FAS, 123R, “Share Based Payment, an amendment of FASB Statement Nos. 123 and 95,” using the modified prospective basis effective January 1, 2006. For the three months ended June 30, 2006, in accordance with the provisions of FAS 123R, we recorded pre-tax charges for stock compensation expense totaling $(82,888)K, of which $(4,927)K were charged to cost of products and services sold, $(52,692)K were charged to selling, general and administrative expense and $(25,269)K were charged to research and development expense. In addition, we recorded $27,577K of related tax benefits. For the six months ended June 30, 2006, in accordance with the provisions of FAS 123R, we recorded pre-tax charges for stock compensation expense totaling $(115,495)K, of which $(7,230)K were charged to cost of products and services sold, $(72,139)K were charged to selling, general and administrative expense and $(36,126)K were charged to research and development expense. In addition, we recorded $37,925K of related tax benefits. Diluted earnings per share and diluted weighted average shares outstanding for the three and six months ended June 30, 2006 were computed in accordance with the provisions of FAS 123R.

(2)             Includes charges for the purchase of in-process research and development of $(9,500)K related to our acquisition of Verigen AG in February 2005.

(3)             Includes pre-tax gains of $69,359K related to the liquidation of our investment in the common stock of Cambridge Antibody Technology Group plc during May and June 2006.

(4)             Reflects the adoption of Emerging Issues Task Force Issue No. 04-8, “The Effect of Contingently Convertible Debt on Diluted Earnings Per Share,” or EITF 04-8. As a result of the adoption of EITF 04-8, the 9,686K shares issuable upon conversion of our $690.0 million in principal of 1.25% convertible senior notes, which were issued in December 2003, are now included in diluted weighted average shares for purposes of computing diluted earnings per share, unless the effect would be anti-dilutive. In accordance with EITF 04-8, interest and debt fees related to the notes of $1.9 million, net of tax, for the three months ended June 30, 2006 and 2005 and $3.7 million, net of tax, for the six months ended June 30, 2006 and 2005 have been added back to net income and approximately 9.7 million shares have been added to diluted weighted average shares outstanding for each of those periods for purposes of computing diluted earnings per share.



GENZYME CORPORATION (GENZ)

Condensed Consolidated Balance Sheets

 

June 30,

 

December 31,

 

(Unaudited, amounts in thousands)

 

2006

 

2005

 

 

 

 

 

 

 

Cash and all marketable securities

 

$

1,358,240

 

$

1,089,102

 

Other current assets(1)

 

1,392,290

 

1,179,093

 

Property, plant and equipment, net

 

1,458,222

 

1,320,813

 

Intangibles, net

 

3,028,777

 

3,078,461

 

Other assets

 

135,342

 

211,396

 

Total assets

 

$

7,372,871

 

$

6,878,865

 

 

 

 

 

 

 

Current liabilities

 

$

616,632

 

$

550,023

 

Noncurrent liabilities

 

1,111,591

 

1,178,975

 

Stockholders’ equity

 

5,644,648

 

5,149,867

 

Total liabilities and stockholders’ equity

 

$

7,372,871

 

$

6,878,865

 

(1)             As of June 30, 2006, includes net proceeds receivable of $99.0 million related to the portion of our investment in the common stock of Cambridge Antibody Technology Group plc that was liquidated in June 2006.



Genzyme Corporation (GENZ)
Analyst Schedule
(Unaudited, amounts in thousands, except percentage amounts)

 

 

 

 

 

 

 

 

 

 

 

 

Q2-06

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

vs.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q2-05

 

 

 

 

 

YTD

 

 

 

Q2-05

 

Q3-05

 

Q4-05

 

Q1-06

 

Q2-06

 

% B/(W)

 

FY 2004

 

FY 2005

 

6/30/06

 

Total revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Renal

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Renagel phosphate binder (including Sevelamer)

 

$

100,847

 

$

106,869

 

$

110,366

 

$

118,655

 

$

126,599

 

26

%

$

363,720

 

$

417,485

 

$

245,254

 

Hectorol

 

—

 

14,138

 

20,377

 

18,904

 

22,412

 

 

 

—

 

34,515

 

41,316

 

Other Renal

 

—

 

—

 

—

 

31

 

(31

)

 

 

—

 

—

 

—

 

Total Renal product and service revenue

 

100,847

 

121,007

 

130,743

 

137,590

 

148,980

 

48

%

363,720

 

452,000

 

286,570

 

Renal R&D revenue

 

—

 

—

 

—

 

—

 

—

 

 

 

—

 

—

 

—

 

Total Renal

 

100,847

 

121,007

 

130,743

 

137,590

 

148,980

 

48

%

363,720

 

452,000

 

286,570

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Therapeutics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cerezyme enzyme

 

235,953

 

238,329

 

232,089

 

239,009

 

253,989

 

8

%

839,366

 

932,322

 

492,998

 

Fabrazyme enzyme

 

74,424

 

79,076

 

81,538

 

80,503

 

89,041

 

20

%

209,637

 

305,064

 

169,544

 

Thyrogen hormone

 

20,699

 

18,503

 

20,823

 

22,993

 

23,723

 

15

%

63,454

 

77,740

 

46,716

 

Other Therapeutics

 

1,281

 

1,903

 

2,128

 

2,128

 

6,609

 

416

%

2,462

 

6,119

 

8,737

 

Total Therapeutics product and service revenue

 

332,357

 

337,811

 

336,578

 

344,633

 

373,362

 

12

%

1,114,919

 

1,321,245

 

717,995

 

Therapeutics R&D revenue

 

235

 

—

 

—

 

1,000

 

—

 

(100

)%

—

 

789

 

1,000

 

Total Therapeutics

 

332,592

 

337,811

 

336,578

 

345,633

 

373,362

 

12

%

1,114,919

 

1,322,034

 

718,995

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Transplant

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Thymoglobulin/Lymphoglobuline

 

33,576

 

32,434

 

34,508

 

32,860

 

39,812

 

19

%

108,928

 

127,739

 

72,672

 

Other Transplant

 

1,465

 

1,677

 

11,084

 

1,406

 

1,400

 

(4

)%

42,125

 

18,143

 

2,806

 

Total Transplant product and service revenue

 

35,041

 

34,111

 

45,592

 

34,266

 

41,212

 

18

%

151,053

 

145,882

 

75,478

 

Transplant R&D revenue

 

—

 

13

 

—

 

—

 

—

 

 

 

310

 

30

 

—

 

Total Transplant

 

35,041

 

34,124

 

45,592

 

34,266

 

41,212

 

18

%

151,363

 

145,912

 

75,478

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Biosurgery

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Synvisc viscosupplementation product and services

 

58,778

 

57,748

 

58,366

 

53,263

 

63,590

 

8

%

88,296

 

218,908

 

116,853

 

Sepra products

 

17,099

 

17,025

 

17,395

 

19,415

 

21,961

 

28

%

61,647

 

68,171

 

41,376

 

Other Biosurgery

 

16,395

 

18,028

 

17,280

 

17,854

 

16,849

 

3

%

55,332

 

65,953

 

34,703

 

Total Biosurgery product and service revenue

 

92,272

 

92,801

 

93,041

 

90,532

 

102,400

 

11

%

205,275

 

353,032

 

192,932

 

Biosurgery R&D revenue

 

9

 

1

 

—

 

4

 

1

 

(89

)%

4,241

 

144

 

5

 

Total Biosurgery

 

92,281

 

92,802

 

93,041

 

90,536

 

102,401

 

11

%

209,516

 

353,176

 

192,937

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diagnostics/Genetics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diagnostic Products

 

22,121

 

25,302

 

29,913

 

29,211

 

26,299

 

19

%

90,955

 

104,202

 

55,510

 

Genetic Testing

 

54,396

 

59,368

 

56,057

 

57,452

 

61,041

 

12

%

188,166

 

222,328

 

118,493

 

Total Diagnostics/Genetics product and service revenue

 

76,517

 

84,670

 

85,970

 

86,663

 

87,340

 

14

%

279,121

 

326,530

 

174,003

 

Diagnostics/Genetics R&D revenue

 

—

 

—

 

—

 

—

 

—

 

 

 

—

 

—

 

—

 

Total Diagnostics/Genetics

 

76,517

 

84,670

 

85,970

 

86,663

 

87,340

 

14

%

279,121

 

326,530

 

174,003

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other product and service revenue

 

26,348

 

33,050

 

32,099

 

32,473

 

36,453

 

38

%

74,495

 

115,993

 

68,926

 

Other R&D revenue

 

4,513

 

4,599

 

4,668

 

3,681

 

3,608

 

(20

)%

8,011

 

19,197

 

7,289

 

Total Other

 

30,861

 

37,649

 

36,767

 

36,154

 

40,061

 

30

%

82,506

 

135,190

 

76,215

 

Total revenues

 

$

668,139

 

$

708,063

 

$

728,691

 

$

730,842

 

$

793,356

 

19

%

$

2,201,145

 

$

2,734,842

 

$

1,524,198

 

 



 

Genzyme Corporation (GENZ)
Analyst Schedule
(Unaudited, amounts in thousands, except percentage and per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

Q2-06

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

vs.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q2-05

 

 

 

 

 

YTD

 

 

 

Q2-05

 

Q3-05

 

Q4-05

 

Q1-06

 

Q2-06

 

% B/(W)

 

FY 2004

 

FY 2005

 

6/30/06

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total product and service revenue

 

$

663,382

 

$

703,450

 

$

724,023

 

$

726,157

 

$

789,747

 

19

%

$

2,188,583

 

$

2,714,682

 

$

1,515,904

 

Total R&D revenue

 

4,757

 

4,613

 

4,668

 

4,685

 

3,609

 

(24

)%

12,562

 

20,160

 

8,294

 

Total revenues

 

668,139

 

708,063

 

728,691

 

730,842

 

793,356

 

19

%

2,201,145

 

2,734,842

 

1,524,198

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total product and service gross profit(1)

 

518,132

 

550,742

 

535,422

 

559,207

 

604,414

 

17

%

1,599,997

 

2,082,030

 

1,163,621

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SG&A expense(1)

 

196,385

 

202,002

 

207,613

 

230,669

 

273,480

 

(39

)%

599,388

 

787,839

 

504,149

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

R&D expense(1)

 

121,726

 

128,000

 

138,186

 

152,323

 

168,941

 

(39

)%

391,802

 

502,657

 

321,264

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of intangibles

 

40,105

 

50,847

 

49,494

 

52,692

 

52,883

 

(32

)%

109,473

 

181,632

 

105,575

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchase of in-process research and development(2)

 

—

 

12,700

 

7,000

 

—

 

—

 

 

 

254,520

 

29,200

 

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Charges for impaired assets(3)

 

—

 

—

 

—

 

—

 

—

 

 

 

4,463

 

—

 

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

164,673

 

161,806

 

137,797

 

128,208

 

112,719

 

(32

)%

252,913

 

600,862

 

240,927

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expenses):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity in income (loss) of equity method investments

 

(417

)

940

 

1,346

 

2,246

 

3,854

 

>100

%

(15,624

)

151

 

6,100

 

Minority interest

 

3,357

 

3,670

 

2,731

 

2,446

 

2,750

 

(18

)%

5,999

 

11,952

 

5,196

 

Gain (loss) on investments in equity securities(4)

 

4,817

 

214

 

526

 

7,942

 

66,967

 

>100

%

(1,252

)

5,698

 

74,909

 

Other

 

253

 

(1,021

)

(707

)

(139

)

(319

)

(226

)%

(357

)

(1,535

)

(458

)

Investment income

 

7,544

 

8,073

 

9,194

 

10,078

 

12,563

 

67

%

24,244

 

31,429

 

22,641

 

Interest expense(5)

 

(4,466

)

(6,749

)

(4,615

)

(4,438

)

(4,035

)

(10

)%

(38,227

)

(19,638

)

(8,473

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

175,761

 

166,933

 

146,272

 

146,343

 

194,499

 

11

%

227,696

 

628,919

 

340,842

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for income taxes(1)

 

(52,130

)

(51,279

)

(39,626

)

(45,369

)

(60,002

)

(15

)%

(141,169

)

(187,430

)

(105,371

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

123,631

 

$

115,654

 

$

106,646

 

$

100,974

 

$

134,497

 

9

%

$

86,527

 

$

441,489

 

$

235,471

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per share of Genzyme Stock-diluted(6,7)

 

$

0.46

 

$

0.43

 

$

0.39

 

$

0.37

 

$

0.49

 

7

%

$

0.37

 

$

1.65

 

$

0.86

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding-diluted(6,7)

 

270,084

 

274,492

 

276,428

 

276,809

 

276,312

 

2

%

234,318

 

272,224

 

276,560

 

 



 

Genzyme Corporation (GENZ)
Analyst Schedule
(Unaudited, amounts in thousands, except percentage amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

YTD

 

 

 

Q2-05

 

Q3-05

 

Q4-05

 

Q1-06

 

Q2-06

 

FY 2004

 

FY 2005

 

6/30/06

 

Total product and service revenue

 

$

663,382

 

$

703,450

 

$

724,023

 

$

726,157

 

$

789,747

 

$

2,188,583

 

$

2,714,682

 

$

1,515,904

 

As a% of total product and service revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Renagel phosphate binder (including Sevelamer)

 

15

%

15

%

15

%

16

%

16

%

17

%

15

%

16

%

Hectorol

 

0

%

2

%

3

%

3

%

3

%

0

%

1

%

3

%

Cerezyme enzyme

 

36

%

34

%

32

%

33

%

32

%

38

%

34

%

32

%

Fabrazyme enzyme

 

11

%

11

%

11

%

11

%

11

%

9

%

11

%

11

%

Thyrogen hormone

 

3

%

3

%

3

%

3

%

3

%

3

%

3

%

3

%

Thymoglobulin/Lymphoglobuline

 

5

%

5

%

5

%

5

%

5

%

5

%

5

%

5

%

Synvisc viscosupplementation product and services

 

9

%

8

%

8

%

7

%

8

%

4

%

8

%

8

%

Sepra products

 

3

%

2

%

2

%

3

%

3

%

3

%

3

%

3

%

Diagnostics/Genetics

 

11

%

12

%

12

%

12

%

11

%

13

%

12

%

11

%

Other

 

7

%

8

%

9

%

7

%

8

%

8

%

8

%

8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total product and service gross margin

 

78

%

78

%

74

%

77

%

77

%

73

%

77

%

77

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

$

668,139

 

$

708,063

 

$

728,691

 

$

730,842

 

$

793,356

 

$

2,201,145

 

$

2,734,842

 

$

1,524,198

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SG&A expense as a % of total revenue

 

29

%

29

%

28

%

32

%

34

%

27

%

29

%

33

%

R&D expense as a % of total revenue

 

18

%

18

%

19

%

21

%

21

%

18

%

18

%

21

%

Operating income as a % of total revenue

 

25

%

23

%

19

%

18

%

14

%

11

%

22

%

16

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for income taxes as a % of profit before tax

 

30

%

31

%

27

%

31

%

31

%

62

%

30

%

31

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Condensed Balance Sheet Information:

 

06/30/05

 

09/30/05

 

12/31/05

 

3/31/06

 

06/30/06

 

12/31/04

 

12/31/05

 

06/30/06

 

Cash and all marketable securities

 

$

1,638,481

 

$

950,342

 

$

1,089,102

 

$

1,201,083

 

$

1,358,240

 

$

1,079,454

 

$

1,089,102

 

$

1,358,240

 

Other current assets (8)

 

1,084,917

 

1,198,359

 

1,179,093

 

1,212,392

 

1,392,290

 

1,082,437

 

1,179,093

 

1,392,290

 

Property, plant and equipment, net

 

1,275,087

 

1,294,990

 

1,320,813

 

1,370,274

 

1,458,222

 

1,310,256

 

1,320,813

 

1,458,222

 

Intangibles, net

 

2,447,344

 

3,124,176

 

3,078,461

 

3,045,680

 

3,028,777

 

2,360,315

 

3,078,461

 

3,028,777

 

Other assets

 

207,430

 

214,098

 

211,396

 

198,497

 

135,342

 

236,959

 

211,396

 

135,342

 

Total assets

 

$

6,653,259

 

$

6,781,965

 

$

6,878,865

 

$

7,027,926

 

$

7,372,871

 

$

6,069,421

 

$

6,878,865

 

$

7,372,871

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

$

913,099

 

$

616,983

 

$

550,023

 

$

515,895

 

$

616,632

 

$

624,398

 

$

550,023

 

$

616,632

 

Noncurrent liabilities

 

1,041,186

 

1,184,766

 

1,178,975

 

1,159,522

 

1,111,591

 

1,064,867

 

1,178,975

 

1,111,591

 

Stockholders’ equity

 

4,698,974

 

4,980,216

 

5,149,867

 

5,352,509

 

5,644,648

 

4,380,156

 

5,149,867

 

5,644,648

 

Total liabilities and stockholders’ equity

 

$

6,653,259

 

$

6,781,965

 

$

6,878,865

 

$

7,027,926

 

$

7,372,871

 

$

6,069,421

 

$

6,878,865

 

$

7,372,871

 

 



 

Notes:

(1)             Reflects the adoption of Financial Accounting Standards Board, or FASB, Statement of Financial Accounting Standards No., or FAS, 123R, “Share-Based Payment, an amendment to FASB Statement Nos. 123 and 95,” using the modified prospective basis effective January 1, 2006. For the three months ended June 30, 2006, in accordance with the provisions of FAS 123R, we recorded pre-tax charges for stock compensation expense totaling $(82,888)K, of which $(4,927)K were charged to cost of products and services sold, $(52,692)K were charged to selling, general and administrative expense and $(25,269)K were charged to research and development expense. In addition, we recorded $27,577K of related tax benefits. For the six months ended June 30, 2006, in accordance with the provisions of FAS 123R, we recorded pre-tax charges for stock compensation expense totaling $(115,495)K, of which $(7,230)K were charged to cost of products and services sold, $(72,139)K were charged to selling, general and administrative expense and $(36,126)K were charged to research and development expense. In addition, we recorded $37,925K of related tax benefits. Diluted earnings per share and diluted weighted average shares outstanding for the three and six months ended June 30, 2006 were computed according to the provisions of FAS 123R.

(2)             Includes charges for the purchase of in-process research and development of $(7,000)K related to our acquisition of gene therapy assets from Avigen, Inc. in December 2005, $(12,700)K related to our acquisition of Bone Care International, Inc. in July 2005, $(9,500)K related to our acquisition of Verigen AG in February 2005 and $(254,520)K related to our acquisition of ILEX Oncology, Inc. in December 2004.

(3)             Includes impairment charges of $(4,463)K recorded in December 2004 to write down the assets of a manufacturing facility in Oklahoma.

(4)             Includes pre-tax gains of $69,359K related to the liquidation of our investment in the common stock of Cambridge Antibody Technology Group plc in May and June 2006.

(5)             In June 2004, we completed the redemption of our 3% convertible subordinated debentures for cash, including $575.0 million in principal, accrued interest of approximately $0.8 million and $4.3 million in premium. Interest expense for the year ended December 31, 2004 includes charges of $(4,313)K for the premium paid upon redemption and $(5,329)K to write off the unamortized debt fees associated with these debentures.

(6)             Reflects the adoption of Emerging Issues Task Force Issue No. 04-8, “The Effect of Contingently Convertible Debt on Diluted Earnings Per Share,” or EITF 04-8. As a result of the adoption of EITF 04-8, interest and debt fees, net of tax, related to our $690.0 million in principal of 1.25% convertible senior notes, which were issued in December 2003, have been added back to net income and the 9,686K shares issuable upon conversion of these notes are now included in diluted weighted average shares for purposes of computing diluted earnings per share, unless the effect would be anti-dilutive.

(7)             For all periods except the year ended December 31, 2004, includes the dilutive effect of options, stock purchase rights and warrants to purchase shares of Genzyme Stock, and the potentially dilutive effect of the assumed conversion of our 1.25% convertible senior notes.

For the year ended December 31, 2004, excludes the potentially dilutive effect of the assumed conversion of our convertible senior notes because the effect would be anti-dilutive.

(8)             As of June 30, 2006, includes net proceeds receivable of $99.0 million related to the portion of our investment in the common stock of Cambridge Antibody Technology Group plc that was liquidated in June 2006.



GENZYME CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP EARNINGS
Quarter Ended June 30, 2006
(Amounts in thousands, except per share data)

 

 

NON-GAAP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Before

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FIN 46,

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FAS 123R,

 

Dilution

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization,

 

Due to

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Gain

 

Contingently

 

Gain/(Loss) on

 

 

 

 

 

 

 

 

 

 

 

 

 

on Equity

 

Convertible

 

Investments

 

 

 

 

 

NON-GAAP

 

 

 

 

 

 

 

Securities &

 

Debt

 

in Equity

 

 

 

FAS 123R

 

Before Effect

 

Effect of

 

GAAP

 

 

 

EITF 04-8

 

(EITF 04-8)

 

Securities

 

Amortization

 

Expense

 

of FIN 46

 

FIN 46

 

As Reported

 

Income Statement Classification:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

$

793,356

 

 

 

 

 

 

 

 

 

$

793,356

 

 

 

$

793,356

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of products and services sold

 

$

(180,406

)

 

 

 

 

 

 

$

(4,927

)

$

(185,333

)

 

 

$

(185,333

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

$

(220,395

)

 

 

 

 

 

 

$

(52,692

)

$

(273,087

)

$

(393

)

$

(273,480

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

$

(138,565

)

 

 

 

 

 

 

$

(25,269

)

$

(163,834

)

$

(5,107

)

$

(168,941

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of intangibles

 

$

—

 

 

 

 

 

$

(52,883

)

 

 

$

(52,883

)

 

 

$

(52,883

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity in income (loss) of equity method investments

 

$

1,105

 

 

 

 

 

 

 

 

 

$

1,105

 

$

2,749

 

$

3,854

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Minority interest

 

$

—

 

 

 

 

 

 

 

 

 

$

—

 

$

2,750

 

$

2,750

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on investments in equity securities

 

$

501

 

 

 

$

66,466

 

 

 

 

 

$

66,967

 

 

 

$

66,967

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

$

(319

)

 

 

 

 

 

 

 

 

$

(319

)

 

 

$

(319

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment income

 

$

12,562

 

 

 

 

 

 

 

 

 

$

12,562

 

$

1

 

$

12,563

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

$

(4,035

)

 

 

 

 

 

 

 

 

$

(4,035

)

 

 

$

(4,035

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

$

263,804

 

$

—

 

$

66,466

 

$

(52,883

)

$

(82,888

)

$

194,499

 

$

(0

)

$

194,499

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Provision for) benefit from income taxes

 

(82,581

)

—

 

(24,459

)

19,461

 

27,577

 

(60,002

)

—

 

(60,002

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

181,223

 

$

—

 

$

42,007

 

$

(33,422

)

$

(55,311

)

$

134,497

 

$

(0

)

$

134,497

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share of Genzyme Stock:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.70

 

$

—

 

$

0.161

 

$

(0.128

)

$

(0.212

)

$

0.52

 

$

—

 

$

0.52

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted(1)

 

$

0.68

 

$

(0.017

)

$

0.152

 

$

(0.121

)

$

(0.200

)

$

0.49

 

$

—

 

$

0.49

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Basic

 

260,444

 

 

 

 

 

 

 

 

 

260,444

 

—

 

260,444

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted(1)

 

266,626

 

 

 

 

 

 

 

 

 

276,312

 

—

 

276,312

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)             GAAP As-Reported diluted earnings per share and diluted weighted average shares outstanding reflect the adoption of EITF 04-8. In accordance with the provisions of EITF 04-8, interest and debt fees related to our 1.25% convertible senior notes of $1.9 million, net of tax, have been added back to net income and approximately 9.7 million shares have been added to diluted weighted average shares for purposes of computing GAAP As-Reported diluted earnings per share.