EX-99.2 3 a09-12952_1ex99d2.htm EX-99.2

Exhibit 99.2

 

GENZYME CORPORATION

RECONCILIATION OF GAAP TO NON-GAAP EARNINGS

For the Three Months Ended March 31, 2009

(Amounts in thousands, except percentage and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

Items Formerly Excluded From Non-GAAP [(Income)/Expense]

 

 

 

GAAP

 

FAS 123R

 

NON-GAAP

 

Inventory

 

Technology

 

 

 

 

 

As Reported

 

Expense

 

As Adjusted (1)

 

Write-offs

 

Purchase

 

Amortization

 

Income Statement Classification:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

 

 

$

1,148,871

 

 

 

 

 

$

1,148,871

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of products and services sold

 

 

 

$

(295,812

)

$

7,234

 

 

 

$

(288,578

)

$

9,154

 

 

 

 

 

Gross margin

 

74

%

$

853,059

 

$

7,234

 

75

%

$

860,293

 

$

9,154

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

 

$

(317,961

)

$

23,836

 

 

 

$

(294,125

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

 

$

(206,925

)

$

13,536

 

 

 

$

(193,389

)

 

 

$

18,180

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of intangibles

 

 

 

$

(57,598

)

 

 

 

 

$

(57,598

)

 

 

 

 

$

57,598

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gains (losses) on investments in equity securities

 

 

 

$

(576

)

 

 

 

 

$

(576

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

$

(979

)

 

 

 

 

$

(979

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment income

 

 

 

$

5,350

 

 

 

 

 

$

5,350

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

 

 

$

274,370

 

$

44,606

 

 

 

$

318,976

 

$

9,154

 

$

18,180

 

$

57,598

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Provision for) benefit from income taxes

 

29

%

$

(78,884

)

$

(12,589

)

29

%

$

(91,473

)

$

(1,923

)

$

(6,544

)

$

(15,891

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

 

 

$

195,486

 

$

32,017

 

 

 

$

227,503

 

$

7,231

 

$

11,636

 

$

41,707

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 

$

0.72

 

$

0.12

 

 

 

$

0.84

 

$

0.03

 

$

0.04

 

$

0.15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted

 

 

 

$

0.70

 

$

0.12

 

 

 

$

0.82

 

$

0.03

 

$

0.04

 

$

0.15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 

270,854

 

 

 

 

 

270,854

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted

 

 

 

277,628

 

 

 

 

 

277,628

 

 

 

 

 

 

 

 

Notes:

 

(1) Represents the adjusted Non-GAAP results of operations and financial position for Genzyme Corporation for the three months ended March 31, 2009.  All other amounts presented herein represent previously reported amounts.  We believe that certain Non-GAAP financial measures, when considered together with the GAAP figures, can enhance the overall understanding of the company’s past financial performance and its prospects for the future.  The Non-GAAP financial measures are included with the intent of providing investors with a more complete understanding of the trends underlying our operating results and financial position and are among the primary indicators management uses for planning and forecasting purposes and measuring the company’s performance.  Such Non-GAAP financial measures should not be considered in isolation or used as a substitute for GAAP.

 


 

GENZYME CORPORATION

RECONCILIATION OF GAAP TO NON-GAAP EARNINGS

For the Year Ended December 31, 2008

(Amounts in thousands, except percentage and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

Items Formerly Excluded from Non-GAAP [(Income)/Expense]

 

 

 

 

 

 

 

 

 

 

 

 

 

Dilution

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Due to

 

Validation/

 

 

 

 

 

 

 

 

 

GAAP

 

FAS 123R

 

NON-GAAP

 

Common Stock

 

Inventory

 

(Gain) Loss on

 

License

 

 

 

 

 

As Reported

 

Expense

 

As Adjusted (1)

 

Equivalents

 

Write-offs

 

Investments

 

Fees

 

Amortization

 

Income Statement Classification:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

 

 

$

4,605,039

 

 

 

 

 

$

4,605,039

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of products and services sold

 

 

 

$

(1,148,562

)

$

27,555

 

 

 

$

(1,121,007

)

 

 

$

12,614

 

 

 

 

 

 

 

Gross margin

 

75

%

$

3,456,477

 

$

27,555

 

76

%

$

3,484,032

 

 

 

$

12,614

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

 

$

(1,338,190

)

$

102,745

 

 

 

$

(1,235,445

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

 

$

(1,308,330

)

$

56,673

 

 

 

$

(1,251,657

)

 

 

$

11,039

 

 

 

$

490,900

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of intangibles

 

 

 

$

(226,442

)

 

 

 

 

$

(226,442

)

 

 

 

 

 

 

 

 

$

226,442

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Charge for impaired assets

 

 

 

$

(2,036

)

 

 

 

 

$

(2,036

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity in income (loss) of equity method investments

 

 

 

$

201

 

 

 

 

 

$

201

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Minority interest

 

 

 

$

2,217

 

 

 

 

 

$

2,217

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gains (losses) on investments in equity securities

 

 

 

$

(3,340

)

 

 

 

 

$

(3,340

)

 

 

 

 

$

5,253

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

$

(1,861

)

 

 

 

 

$

(1,861

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment income

 

 

 

$

51,260

 

 

 

 

 

$

51,260

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Expense

 

 

 

$

(4,418

)

 

 

 

 

$

(4,418

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

 

 

$

625,538

 

$

186,973

 

 

 

$

812,511

 

$

—

 

$

23,653

 

$

5,253

 

$

490,900

 

$

226,442

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Provision for) benefit from income taxes

 

33

%

$

(204,457

)

$

(56,740

)

32

%

$

(261,197

)

$

—

 

$

(5,724

)

$

(390

)

$

(108,328

)

$

(75,399

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

 

 

$

421,081

 

$

130,233

 

 

 

$

551,314

 

$

—

 

$

17,929

 

$

4,863

 

$

382,572

 

$

151,043

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 

$

1.57

 

$

0.50

 

 

 

$

2.07

 

$

—

 

$

0.07

 

$

0.02

 

$

1.42

 

$

0.56

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted (2)

 

 

 

$

1.50

 

$

0.45

 

 

 

$

1.95

 

$

0.11

 

$

0.06

 

$

0.01

 

$

1.34

 

$

0.53

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 

268,490

 

 

 

 

 

268,490

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted (2)

 

 

 

285,595

 

 

 

 

 

285,595

 

 

 

 

 

 

 

 

 

 

 

 

Notes:

 

(1) Represents the adjusted Non-GAAP results of operations and financial position for Genzyme Corporation for the year ended December 31, 2008.  All other amounts presented herein represent previously reported amounts.  We believe that certain Non-GAAP financial measures, when considered together with the GAAP figures, can enhance the overall understanding of the company’s past financial performance and its prospects for the future.  The Non-GAAP financial measures are included with the intent of providing investors with a more complete understanding of the trends underlying our operating results and financial position and are among the primary indicators management uses for planning and forecasting purposes and measuring the company’s performance.  Such Non-GAAP financial measures should not be considered in isolation or used as a substitute for GAAP.

 

(2) 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 $6,915K, net of tax, have been added back to net income and approximately 8,851K shares have been added to diluted weighted average shares outstanding for purposes of computing GAAP and Non-GAAP diluted earnings per share.

 


 

GENZYME CORPORATION

RECONCILIATION OF GAAP TO NON-GAAP EARNINGS

For the Year Ended December 31, 2007

(Amounts in thousands, except percentage and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Items Formerly Excluded From Non-GAAP [(Income)/Expense]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dilution

 

(Gain) on

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Due to

 

Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP

 

FAS 123R

 

Acquisition

 

NON-GAAP

 

Common Stock

 

in Equity

 

Litigation

 

Milestone

 

Manufacturing

 

 

 

Effect of

 

 

 

As Reported

 

Expense

 

Related

 

As Adjusted (1)

 

Equivalents

 

Securities

 

Settlement

 

Payment

 

Related

 

Amortization

 

FIN 46

 

Income Statement Classification:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

 

 

$

3,813,519

 

 

 

 

 

 

 

$

3,813,519

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of products and services sold

 

 

 

$

(927,330

)

$

25,677

 

 

 

 

 

$

(901,653

)

 

 

 

 

 

 

 

 

$

20,916

 

 

 

 

 

Gross margin

 

76

%

$

2,886,189

 

$

25,677

 

 

 

76

%

$

2,911,866

 

 

 

 

 

 

 

 

 

$

20,916

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

 

$

(1,186,438

)

$

106,172

 

 

 

 

 

$

(1,080,266

)

 

 

 

 

$

64,000

 

 

 

 

 

 

 

$

200

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

 

$

(731,950

)

$

58,101

 

 

 

 

 

$

(673,849

)

 

 

 

 

 

 

$

25,000

 

 

 

 

 

$

7,461

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of intangibles

 

 

 

$

(201,105

)

 

 

 

 

 

 

$

(201,105

)

 

 

 

 

 

 

 

 

 

 

$

201,105

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchase of in-process research and development

 

 

 

$

(106,350

)

 

 

$

106,350

 

 

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity in income (loss) of equity method investments

 

 

 

$

7,398

 

 

 

$

19,150

 

 

 

$

26,548

 

 

 

 

 

 

 

 

 

 

 

$

830

 

$

(3,830

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Minority interest

 

 

 

$

3,932

 

 

 

 

 

 

 

$

3,932

 

 

 

 

 

 

 

 

 

 

 

 

 

$

(3,831

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gains (losses) on investments in equity securities

 

 

 

$

13,067

 

 

 

 

 

 

 

$

13,067

 

 

 

$

(10,848

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

$

(7,118

)

 

 

 

 

 

 

$

(7,118

)

 

 

 

 

 

 

 

 

$

5,735

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment income

 

 

 

$

70,196

 

 

 

 

 

 

 

$

70,196

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Expense

 

 

 

$

(12,147

)

 

 

 

 

 

 

$

(12,147

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

 

 

$

735,674

 

$

189,950

 

$

125,500

 

 

 

$

1,051,124

 

$

—

 

$

(10,848

)

$

64,000

 

$

25,000

 

$

26,651

 

$

201,935

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Provision for) benefit from income taxes

 

35

%

$

(255,481

)

$

(58,148

)

(15,781

)

31

%

$

(329,410

)

$

—

 

$

2,698

 

$

—

 

$

(9,069

)

$

(9,702

)

$

(72,449

)

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

 

 

$

480,193

 

$

131,802

 

$

109,719

 

 

 

$

721,714

 

$

—

 

$

(8,150

)

$

64,000

 

$

15,931

 

$

16,949

 

$

129,486

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 

$

1.82

 

$

0.50

 

$

0.41

 

 

 

$

2.73

 

$

—

 

$

(0.03

)

$

0.24

 

$

0.06

 

$

0.06

 

$

0.49

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted (2)

 

 

 

$

1.74

 

$

0.47

 

$

0.39

 

 

 

$

2.60

 

$

0.09

 

$

(0.03

)

$

0.23

 

$

0.06

 

$

0.06

 

$

0.46

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 

263,895

 

 

 

 

 

 

 

263,895

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted (2)

 

 

 

280,767

 

 

 

 

 

 

 

280,767

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Notes:

 

(1) Represents the adjusted Non-GAAP results of operations and financial position for Genzyme Corporation for the year ended December 31, 2007.  All other amounts presented herein represent previously reported amounts. We believe that certain Non-GAAP financial measures, when considered together with the GAAP figures, can enhance the overall understanding of the company’s past financial performance and its prospects for the future.  The Non-GAAP financial measures are included with the intent of providing investors with a more complete understanding of the trends underlying our operating results and financial position and are among the primary indicators management uses for planning and forecasting purposes and measuring the company’s performance.  Such Non-GAAP financial measures should not be considered in isolation or used as a substitute for GAAP.

 

(2) 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 $7,543K, net of tax, have been added back to net income and approximately 9,686K shares have been added to diluted weighted average shares outstanding for purposes of computing GAAP and Non-GAAP diluted earnings per share.

 

 


 

GENZYME CORPORATION

RECONCILIATION OF GAAP TO NON-GAAP EARNINGS

For the Year Ended December 31, 2006

(Amounts in thousands, except percentage and per share data)

 

 

 

 

 

 

 

 

 

 

 

Dilution

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Due to

 

 

 

 

 

Items Formerly Excluded From Non-GAAP [(Income)/Expense]

 

 

 

 

 

 

 

 

 

 

 

Transition

 

 

 

 

 

 

 

(Gain)/Loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

from

 

 

 

 

 

 

 

on Investments

 

 

 

 

 

 

 

 

 

 

 

GAAP

 

FAS 123R

 

 

 

(Net Loss) to

 

NON-GAAP

 

OFT

 

in Equity

 

Settlement of

 

Impairment of

 

 

 

Effect of

 

 

 

As Reported

 

Expense

 

IPR&D

 

Net Income

 

As Adjusted (1)

 

Settlement

 

Securities

 

Tax Audits

 

Goodwill

 

Amortization

 

FIN 46

 

Income Statement Classification:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

 

 

$

3,187,013

 

 

 

 

 

 

 

 

 

$

3,187,013

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of products and services sold

 

 

 

$

(735,671

)

$

21,430

 

 

 

 

 

 

 

$

(714,241

)

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin

 

77

%

$

2,451,342

 

$

21,430

 

 

 

 

 

78

%

$

2,472,772

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative

 

 

 

$

(1,010,400

)

$

121,822

 

 

 

 

 

 

 

$

(888,578

)

$

7,936

 

 

 

 

 

 

 

 

 

$

1,376

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and development

 

 

 

$

(649,951

)

$

65,248

 

 

 

 

 

 

 

$

(584,703

)

 

 

 

 

 

 

 

 

 

 

$

19,328

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amortization of intangibles

 

 

 

$

(209,355

)

 

 

 

 

 

 

 

 

$

(209,355

)

 

 

 

 

 

 

 

 

$

209,355

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Purchase of in-process research and development

 

 

 

$

(552,900

)

 

 

$

552,900

 

 

 

 

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Charge for impaired goodwill

 

 

 

$

(219,245

)

 

 

 

 

 

 

 

 

$

(219,245

)

 

 

 

 

 

 

$

219,245

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity in income (loss) of equity method investments

 

 

 

$

15,705

 

 

 

 

 

 

 

 

 

$

15,705

 

 

 

 

 

 

 

 

 

 

 

$

(10,348

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Minority interest

 

 

 

$

10,418

 

 

 

 

 

 

 

 

 

$

10,418

 

 

 

 

 

 

 

 

 

 

 

$

(10,352

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gains (losses) on investments in equity securities

 

 

 

$

73,230

 

 

 

 

 

 

 

 

 

$

73,230

 

 

 

$

(66,466

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other

 

 

 

$

(2,045

)

 

 

 

 

 

 

 

 

$

(2,045

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment income

 

 

 

$

56,001

 

 

 

 

 

 

 

 

 

$

56,001

 

 

 

 

 

 

 

 

 

 

 

$

(4

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest Expense

 

 

 

$

(15,478

)

 

 

 

 

 

 

 

 

$

(15,478

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Summary:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

 

 

$

(52,678

)

$

208,500

 

$

552,900

 

$

—

 

 

 

$

708,722

 

$

7,936

 

$

(66,466

)

$

—

 

$

219,245

 

$

209,355

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Provision for) benefit from income taxes

 

68

%

$

35,881

 

$

(66,331

)

$

(148,565

)

$

—

 

25

%

$

(179,015

)

$

(2,920

)

$

24,459

 

$

(31,748

)

$

(69,823

)

$

(77,043

)

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

 

 

$

(16,797

)

$

142,169

 

$

404,335

 

$

—

 

 

 

$

529,707

 

$

5,016

 

$

(42,007

)

$

(31,748

)

$

149,422

 

$

132,312

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 

$

(0.06

)

$

0.54

 

$

1.54

 

$

—

 

 

 

$

2.02

 

$

0.02

 

$

(0.16

)

$

(0.12

)

$

0.57

 

$

0.51

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted (2)

 

 

 

$

(0.06

)

$

0.52

 

$

1.54

 

$

—

 

 

 

$

2.00

 

$

0.02

 

$

(0.15

)

$

(0.11

)

$

0.54

 

$

0.48

 

$

—

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 

261,124

 

 

 

 

 

 

 

 

 

261,124

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted (2)

 

 

 

261,124

 

 

 

 

 

6,892

 

 

 

268,016

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Notes:

 

(1) Represents the adjusted Non-GAAP results of operations and financial position for Genzyme Corporation for the year ended December 31, 2006.  All other amounts presented herein represent previously reported amounts.  We believe that certain Non-GAAP financial measures, when considered together with the GAAP figures, can enhance the overall understanding of the company’s past financial performance and its prospects for the future.  The Non-GAAP financial measures are included with the intent of providing investors with a more complete understanding of the trends underlying our operating results and financial position and are among the primary indicators management uses for planning and forecasting purposes and measuring the company’s performance.  Such Non-GAAP financial measures should not be considered in isolation or used as a substitute for GAAP.

 

(2) Common stock equivalents are included in the calculation of diluted earnings per share to the extent they are dilutive.  Due to the significant IPR&D charge for AnorMED of $552,900K, Genzyme had a GAAP net loss for the year ended December 31, 2006 and, therefore, the effect of options, stock purchase rights and warrants to purchase shares of Genzyme Stock, which we refer to collectively as common stock equivalents, and the potentially dilutive effect of our 1.25% convertible notes are excluded from the calculation of GAAP diluted net loss per share because the effect would be anti-dilutive.  Conversely, on a Non-GAAP basis, Genzyme produced a net profit and, therefore, the common stock equivalents are included in the calculation of Non-GAAP diluted net income per share because the effect is dilutive.  Non-GAAP diluted earnings per share excludes the potentially dilutive effect of our 1.25% convertible notes.