SHIRE PLC
|
||||
By:
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/s/ A C Russell
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|||
Name: | Angus Russell | |||
Title: | Chief Executive Officer |
EXHIBIT INDEX
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Number
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Description
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99.01
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Press Release dated April 28, 2011
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Exhibit 99.01
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Press Release
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![]() |
www.shire.com
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Financial Highlights
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Q1 2011(1)
|
|
Product sales
|
$889 million
|
+24%
|
Total revenues
|
$972 million
|
+19%
|
|
||
Non GAAP operating income
|
$306 million
|
+15%
|
US GAAP operating income
|
$267 million
|
+22%
|
|
||
Non GAAP diluted earnings per ADS
|
$1.23
|
+22%
|
US GAAP diluted earnings per ADS
|
$1.11
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+25%
|
|
||
Non GAAP cash generation
|
$208 million
|
-25%
|
Non GAAP free cash flow
|
$155 million
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+9%
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US GAAP net cash provided by operating activities
|
$202 million
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+8%
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|
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Q1 2011
|
|
Q1 2010
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||||||||
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US GAAP
|
Adjustments
|
Non GAAP
|
US GAAP
|
Adjustments
|
Non GAAP
|
||||||
|
|
$M
|
|
$M
|
|
$M
|
|
$M
|
|
$M
|
|
$M
|
Total revenues
|
|
972
|
|
-
|
|
972
|
|
816
|
|
-
|
|
816
|
Operating income
|
|
267
|
|
39
|
|
306
|
|
218
|
|
47
|
|
265
|
Diluted earnings per ADS
|
|
$1.11
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|
$0.12
|
|
$1.23
|
|
$0.89
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|
$0.12
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|
$1.01
|
·
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Product sales were up 24% to $889 million (Q1 2010: $718 million), driven by growth from VYVANSE® (up 31% to $202 million), LIALDA®/MEZAVANT® (up 37% to $87 million), REPLAGAL® (up 55% to $105 million) and VPRIV® (up $53 million to $59 million). On a constant exchange rate (“CER”) basis, which is a Non GAAP measure, product sales were up 24%.
|
·
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Total revenues were up 19% (CER: up 19%) to $972 million (Q1 2010: $816 million). Increased product sales were partially offset by lower royalties (down 23% to $74 million), due to lower royalty income from Impax Laboratories Inc’s (“Impax”) authorized generic version of ADDERALL XR® (down 59% to $17 million) as Q1 2010 included royalties on launch shipments not repeated in 2011.
|
·
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Non GAAP operating income was up 15% to $306 million (Q1 2010: $265 million). Higher total revenues were partially offset by higher operating costs in Q1 2011, as we have chosen to increase investment in research and development (“R&D”) to sustain the progression of our pipeline. In the first quarter, we have increased selling, general and administrative (“SG&A”) expenditure to support our ongoing international expansion and anticipated future growth, and we also absorbed a full quarter's operating costs for Movetis and our commercial hub in Switzerland. On a US GAAP basis, operating income was up 22% to $267 million (Q1 2010: $218 million).
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·
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Non GAAP diluted earnings per ADS were up 22% to $1.23 (Q1 2010: $1.01), principally due to higher Non GAAP operating income and a lower quarterly Non GAAP effective tax rate of 22%. On a US GAAP basis, diluted earnings per ADS were up 25% to $1.11 (Q1 2010: $0.89).
|
·
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Cash generation, a Non GAAP measure, decreased by $68 million to $208 million (Q1 2010: $276 million). Cash generation in Q1 2011 was impacted by the timing and quantum of sales deduction payments, particularly for Medicaid, and lower Impax royalty receipts (Q1 2010 included royalty receipts for Impax’s initial Q4 2009 stocking). The effect of these items, together with the increase in operating expenditure, more than offset increased cash receipts from higher product sales in Q1 2011.
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·
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Net debt at March 31, 2011 was $365 million (December 31, 2010: $531 million), a reduction of $166 million over the quarter.
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·
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EQUASYM® for the treatment of ADHD in certain European countries;
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·
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RESOLOR® for the symptomatic treatment of chronic constipation in women for whom laxatives fail to provide adequate relief, in certain European countries;
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·
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VPRIV for the treatment of type 1 Gaucher disease in certain European and Latin American countries; and
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·
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FIRAZYR® for the symptomatic treatment of acute attacks of hereditary angioedema (“HAE”) in the US and certain European and Latin American countries.
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·
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LIALDA® for the maintenance of remission of ulcerative colitis in the US.
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·
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On April 18, 2011 Shire launched VENVANSE for the treatment of ADHD in children in Brazil, the first launch of lisdexsamfetamine dimesylate (marketed as VYVANSE in the US) outside of North America.
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·
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On February 10, 2011 Health Canada granted approval of LIALDA for the maintenance of remission of ulcerative colitis.
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·
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On February 28, 2011 Shire announced that the US Food and Drug Administration (“FDA”) had approved the use of once-daily INTUNIV extended-release tablets as adjunctive therapy to stimulants for the treatment of ADHD in children and adolescents aged 6 to 17 as part of a total treatment program.
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·
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REPLAGAL remains the global market leader for the treatment of Fabry disease. Shire expects to have manufacturing capacity to continue uninterrupted treatment for all patients currently on REPLAGAL and to continue to meet anticipated demand from new and switch patients in 2011.
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·
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In April 2011, Shire filed for approval in Europe of the new manufacturing facility in Lexington, MA for the production of REPLAGAL. Approval will allow greater manufacturing flexibility. Shire has already cleared an important milestone with the successful inspection of the facility by European authorities in support of this submission.
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·
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Shire has seen rapid adoption of VPRIV worldwide, with market share of 34% in the US and 18% globally, and patients continue to initiate treatment. Approval of the new manufacturing facility in Lexington for VPRIV will provide substantial additional capacity; process validation runs are currently ongoing. Shire’s continuing priority is to ensure long-term, uninterrupted treatment for patients on VPRIV.
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·
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On March 3, 2011 Shire announced that the European Commission had approved FIRAZYR for self-administrated subcutaneous injections. FIRAZYR is the first and only treatment for acute Type I and Type II HAE attacks licensed for self-administration in Europe.
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·
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On March 21, 2011 Shire announced that the FDA had assigned a Prescription Drug User Fee Act date of August 25, 2011 for the review of the New Drug Application (“NDA”) for FIRAZYR. This followed Shire’s submission of a complete response to the not approvable letter issued by the FDA regarding the NDA for FIRAZYR submitted by Jerini AG.
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·
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Data from a recently completed Phase 2 proof-of-concept clinical trial indicates a statistically significant improvement in negative symptoms of schizophrenia. In this 14-week, flexible dose, multi-center study with open-label and double-blind components, VYVANSE was administered as adjunctive therapy to clinically stable patients with predominant negative symptom schizophrenia and taking established maintenance doses of atypical antipsychotic medications, using an open-label, rater-blinded design. VYVANSE was well tolerated, and not associated with notable worsening of positive symptoms, or new vital sign, laboratory or ECG findings. No rebound or negative or withdrawal symptoms were found in the subsequent placebo-controlled, double-blind withdrawal portion of the study.
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·
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A Phase 3 clinical program has been initiated to assess the safety and efficacy of RESOLOR in the treatment of opioid-induced constipation in patients with chronic, non-cancer pain.
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·
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In February 2011, Shire was notified by Watson Laboratories, Inc. (“Watson”) that it had submitted an Abbreviated New Drug Application (“ANDA”) under the Hatch-Waxman Act seeking permission to market a generic version of all approved strengths of ADDERALL XR. This new ANDA is not covered under the existing settlement agreements entered into in November 2007 between Shire and Watson (the “Settlement Agreements”). The Settlement Agreements cover a different ANDA and do not provide any license for Watson to sell the products covered in Watson’s new ANDA. On April 5, 2011 Shire filed a lawsuit in the U.S. District Court for the Southern District of New York against Watson and its subsidiaries for infringement of certain of Shire’s ADDERALL XR patents and also for breach of contract in connection with the Settlement Agreements. The filing of the lawsuit triggered a stay of approval of this ANDA for up to 30 months. No trial date has been set.
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Page
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Overview of First Quarter 2011 Financial Results
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7
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Financial Information
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11
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Non GAAP Reconciliations
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17
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Safe Harbor Statement
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19
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Explanation of Non GAAP Measures
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20
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Trademarks
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21
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Investor Relations
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Eric Rojas (erojas@shire.com)
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+1 781 482 0999
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Sarah Elton-Farr (seltonfarr@shire.com)
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+44 1256 894 157
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Media
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Jessica Mann (jmann@shire.com)
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+44 1256 894 280
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Matthew Cabrey (mcabrey@shire.com)
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+1 484 595 8248
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Jessica Cotrone (jcotrone@shire.com)
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+1 781 482 9538
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UK dial in:
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0800 077 8492 or 0844 335 0351
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US dial in:
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1 866 8048688 or 1 718 3541175
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International dial in:
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+44 844 335 0351
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Password/Conf ID:
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172136
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Live Webcast:
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http://www.shire.com/shireplc/en/investors
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1.
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Product sales
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Year on year growth
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US Exit
Market
Share(1)
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||||||
Product
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Sales $M
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Sales
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CER
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US Rx(1)
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VYVANSE
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202.3
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+31%
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1
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+31%
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+24%
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15%
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ADDERALL XR
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111.2
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+21%
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1
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+21%
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+12%
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8%
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REPLAGAL
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105.4
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|
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+55%
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1
|
|
+56%
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n/a(3)
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n/a(3)
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ELAPRASE®
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|
103.5
|
|
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+3%
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1
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+2%
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n/a(2)
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n/a(2)
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LIALDA / MEZAVANT
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87.1
|
|
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+37%
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1
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+37%
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+13%
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20%
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PENTASA®
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|
64.5
|
|
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+11%
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|
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+11%
|
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0%
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15%
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VPRIV
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59.0
|
|
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+917%
|
1
|
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+921%
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|
n/a(2)
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n/a(2)
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INTUNIV
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|
41.9
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|
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+21%
|
1
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+21%
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+152%
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3%
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FOSRENOL®
|
|
41.2
|
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-13%
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1
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-13%
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-14%
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6%
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FIRAZYR
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|
5.3
|
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+141%
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1
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+141%
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n/a(3)
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n/a(3)
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RESOLOR
|
|
0.9
|
|
|
n/a
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1
|
|
n/a
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|
n/a(3)
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n/a(3)
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OTHER
|
|
67.0
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|
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-27%
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1
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-28%
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|
n/a
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n/a
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Total product sales
|
|
889.3
|
|
|
+24%
|
1
|
|
+24%
|
|
||
|
|
|
|
|
|
|
(1)
|
Data provided by IMS Health National Prescription Audit (“IMS NPA”). Exit market share represents the average monthly US market share in the month ended March 31, 2011.
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(2)
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IMS NPA Data not available.
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(3)
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Not sold in the US in Q1 2011.
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2.
|
Royalties
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|
|
|
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Year on year growth
|
|||||
Product
|
|
Royalties to
Shire $M
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|
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Royalties
|
|
|
CER
|
|
|
|
|
|
|
|
|
|
||
3TC® and Zeffix®
|
1.00
|
35.5
|
|
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-3%
|
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-3%
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ADDERALL XR
|
1.00
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16.8
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-59%
|
|
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-59%
|
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Other
|
1.00
|
21.3
|
|
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19%
|
|
|
18%
|
|
Total
|
1.00
|
73.6
|
|
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-23%
|
|
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-23%
|
|
|
|
|
|
|
|
|
|
3.
|
Financial details
|
|
Q1 2011
|
|
% of
product
sales
|
|
Q1 2010
|
|
% of
product
sales
|
|
$M
|
|
|
$M
|
|
||
Cost of product sales (US GAAP)
|
124.5
|
|
14%
|
|
101.9
|
|
14%
|
Transfer of manufacturing from Owings Mills
|
(2.8)
|
|
|
|
(7.2)
|
|
|
Depreciation
|
(5.5)
|
|
|
|
(2.5)
|
|
|
Cost of product sales (Non GAAP)
|
116.2
|
|
13%
|
|
92.2
|
|
13%
|
|
|
|
|
|
|
|
|
|
Q1 2011
|
|
% of
product
sales
|
|
Q1 2010
|
|
% of
product
sales
|
|
$M
|
|
|
$M
|
|
||
R&D (US GAAP)
|
177.9
|
|
20%
|
|
131.0
|
|
18%
|
Depreciation
|
(4.7)
|
|
|
|
(3.7)
|
|
|
R&D (Non GAAP)
|
173.2
|
|
19%
|
|
127.3
|
|
18%
|
|
|
|
|
|
|
|
|
|
Q1 2011
|
|
% of
product
sales
|
|
Q1 2010
|
|
% of
product
sales
|
|
$M
|
|
|
$M
|
|
||
SG&A (US GAAP)
|
402.9
|
|
45%
|
|
359.9
|
|
50%
|
Intangible asset amortization
|
(36.1)
|
|
|
|
(34.6)
|
|
|
Depreciation
|
(14.6)
|
|
|
|
(16.3)
|
|
|
SG&A (Non GAAP)
|
352.2
|
|
40%
|
|
309.0
|
|
43%
|
|
|
|
|
|
|
|
|
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Page
|
|
|
Unaudited US GAAP Consolidated Balance Sheets
|
12
|
|
|
Unaudited US GAAP Consolidated Statements of Income
|
13
|
|
|
Unaudited US GAAP Consolidated Statements of Cash Flows
|
14
|
|
|
Selected Notes to the Unaudited US GAAP Financial Statements
|
|
(1) Earnings per share
|
15
|
(2) Analysis of revenues
|
16
|
|
|
Non GAAP reconciliation
|
17
|
|
March 31,
|
December 31,
|
||||||
|
2011
|
2010
|
||||||
|
$M | $M | ||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
712.0 | 550.6 | ||||||
Restricted cash
|
30.8 | 26.8 | ||||||
Accounts receivable, net
|
786.3 | 692.5 | ||||||
Inventories
|
281.9 | 260.0 | ||||||
Deferred tax asset
|
129.7 | 182.0 | ||||||
Prepaid expenses and other current assets
|
170.8 | 168.4 | ||||||
|
||||||||
Total current assets
|
2,111.5 | 1,880.3 | ||||||
|
||||||||
Non-current assets:
|
||||||||
Investments
|
119.5 | 101.6 | ||||||
Property, plant and equipment, net
|
869.8 | 853.4 | ||||||
Goodwill
|
414.9 | 402.5 | ||||||
Other intangible assets, net
|
1,985.8 | 1,978.9 | ||||||
Deferred tax asset
|
116.9 | 110.4 | ||||||
Other non-current assets
|
54.4 | 60.5 | ||||||
|
||||||||
Total assets
|
5,672.8 | 5,387.6 | ||||||
|
||||||||
LIABILITIES AND EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable and accrued expenses
|
1,208.5 | 1,239.3 | ||||||
Deferred tax liability
|
4.4 | 4.4 | ||||||
Other current liabilities
|
35.7 | 49.6 | ||||||
|
||||||||
Total current liabilities
|
1,248.6 | 1,293.3 | ||||||
|
||||||||
Non-current liabilities:
|
||||||||
Convertible bonds
|
1,100.0 | 1,100.0 | ||||||
Deferred tax liability
|
348.4 | 352.1 | ||||||
Other non-current liabilities
|
206.7 | 190.8 | ||||||
|
||||||||
Total liabilities
|
2,903.7 | 2,936.2 | ||||||
|
||||||||
Equity:
|
||||||||
Common stock of 5p par value; 1,000 million shares authorized; and 562.2 million shares issued and outstanding (2010: 1,000 million shares authorized; and 562.2 million shares issued and outstanding)
|
55.7 | 55.7 | ||||||
Additional paid-in capital
|
2,769.6 | 2,746.4 | ||||||
Treasury stock: 10.9 million shares (2010: 14.0 million)
|
(217.3 | ) | (276.1 | ) | ||||
Accumulated other comprehensive income
|
168.8 | 85.7 | ||||||
Accumulated deficit
|
(7.7 | ) | (160.3 | ) | ||||
|
||||||||
Total equity
|
2,769.1 | 2,451.4 | ||||||
|
||||||||
Total liabilities and equity
|
5,672.8 | 5,387.6 |
3 months to March 31,
|
2011
|
2010
|
||||||
$M | $M | |||||||
Revenues:
|
||||||||
Product sales
|
889.3 | 718.2 | ||||||
Royalties
|
73.6 | 95.3 | ||||||
Other revenues
|
9.3 | 2.7 | ||||||
Total revenues
|
972.2 | 816.2 | ||||||
Costs and expenses:
|
||||||||
Cost of product sales(1)
|
124.5 | 101.9 | ||||||
Research and development
|
177.9 | 131.0 | ||||||
Selling, general and administrative(1)
|
402.9 | 359.9 | ||||||
Loss on sale of product rights
|
1.3 | - | ||||||
Reorganization costs
|
5.5 | 5.0 | ||||||
Integration and acquisition costs
|
(6.4 | ) | 0.6 | |||||
Total operating expenses
|
705.7 | 598.4 | ||||||
Operating income
|
266.5 | 217.8 | ||||||
Interest income
|
0.6 | 0.4 | ||||||
Interest expense
|
(9.2 | ) | (9.0 | ) | ||||
Other income, net
|
0.3 | 10.8 | ||||||
Total other (expense)/income, net
|
(8.3 | ) | 2.2 | |||||
Income from continuing operations before income taxes and equity in earnings/(losses) of equity method investees
|
258.2 | 220.0 | ||||||
Income taxes
|
(48.1 | ) | (53.6 | ) | ||||
Equity in earnings/(losses) of equity method investees, net of taxes
|
1.2 | (0.5 | ) | |||||
Net income
|
211.3 | 165.9 |
Earnings per ordinary share – basic
|
38.5 | c | 30.5 | c | ||||
|
||||||||
Earnings per ADS – basic
|
115.5 | c | 91.5 | c | ||||
|
||||||||
Earnings per ordinary share – diluted
|
37.0 | c | 29.7 | c | ||||
|
||||||||
Earnings per ADS – diluted
|
111.0 | c | 89.1 | c | ||||
|
||||||||
Weighted average number of shares:
|
||||||||
|
Millions
|
Millions
|
||||||
|
||||||||
Basic
|
549.5 | 543.9 | ||||||
Diluted
|
593.6 | 586.1 |
3 months to March 31,
|
2011
|
2010
|
||||||
$M | $M | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||
Net income
|
211.3 | 165.9 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
63.5 | 64.3 | ||||||
Share based compensation
|
15.7 | 14.1 | ||||||
Gain on sale of non-current investments
|
- | (11.1 | ) | |||||
Other
|
(5.5 | ) | 5.2 | |||||
Movement in deferred taxes
|
42.2 | 52.2 | ||||||
Equity in (earnings)/losses of equity method investees
|
(1.2 | ) | 0.5 | |||||
Changes in operating assets and liabilities:
|
||||||||
Increase in accounts receivable
|
(74.8 | ) | (10.8 | ) | ||||
Increase in sales deduction accrual
|
31.2 | 64.9 | ||||||
Increase in inventory
|
(12.7 | ) | (24.2 | ) | ||||
Decrease/(increase) in prepayments and other current assets
|
1.1 | (18.1 | ) | |||||
Decrease/(increase) in other assets
|
3.9 | (0.6 | ) | |||||
Decrease in accounts and notes payable and other liabilities
|
(72.8 | ) | (116.1 | ) | ||||
Net cash provided by operating activities(A)
|
201.9 | 186.2 |
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
||||||
Movements in restricted cash
|
(4.1 | ) | 6.3 | |||||
Purchases of non-current investments
|
(2.5 | ) | - | |||||
Purchases of property, plant and equipment
|
(46.5 | ) | (43.6 | ) | ||||
Proceeds from disposal of non-current investments and property, plant and equipment
|
0.1 | 2.1 | ||||||
Returns of equity investments
|
1.1 | - | ||||||
Net cash used in investing activities(B)
|
(51.9 | ) | (35.2 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||
Payment under building financing obligation
|
(0.2 | ) | (0.7 | ) | ||||
Proceeds from exercise of options
|
0.2 | 1.5 | ||||||
Tax benefit of stock based compensation
|
9.0 | 4.8 | ||||||
Net cash provided by financing activities(C)
|
9.0 | 5.6 | ||||||
Effect of foreign exchange rate changes on cash and cash equivalents(D)
|
2.4 | 2.0 | ||||||
Net increase in cash and cash equivalents(A) +(B) +(C) +(D)
|
161.4 | 158.6 | ||||||
Cash and cash equivalents at beginning of period
|
550.6 | 498.9 | ||||||
Cash and cash equivalents at end of period
|
712.0 | 657.5 |
3 months to March 31,
|
2011
|
2010
|
||||||
$M | $M | |||||||
Net Income
|
211.3 | 165.9 | ||||||
Numerator for basic EPS
|
211.3 | 165.9 | ||||||
Interest on convertible bonds, net of tax
|
8.4 | 8.4 | ||||||
Numerator for diluted EPS
|
219.7 | 174.3 | ||||||
Weighted average number of shares:
|
||||||||
Millions
|
Millions
|
|||||||
Basic(1)
|
549.5 | 543.9 | ||||||
Effect of dilutive shares:
|
||||||||
Stock options(2)
|
10.9 | 9.0 | ||||||
Convertible bonds 2.75% due 2014(3)
|
33.2 | 33.2 | ||||||
Diluted
|
593.6 | 586.1 |
3 months to March 31,
|
2011
|
2010
|
||||||
|
No. of
shares
Millions(1)
|
No. of
shares
Millions(1)
|
||||||
|
||||||||
Stock options out of the money
|
7.5 | 16.1 |
3 months to March 31,
|
2011
|
2010
|
2011
|
2011
|
||||||||||||
|
|
%
|
% of total
|
|||||||||||||
$M | $M |
change
|
revenue
|
|||||||||||||
Net product sales:
|
|
|
||||||||||||||
SP
|
|
|
||||||||||||||
ADHD
|
|
|
||||||||||||||
VYVANSE
|
202.3 | 154.4 | 31 | % | 21 | % | ||||||||||
ADDERALL XR
|
111.2 | 91.8 | 21 | % | 11 | % | ||||||||||
INTUNIV
|
41.9 | 34.5 | 21 | % | 4 | % | ||||||||||
EQUASYM
|
4.6 | 2.4 | 92 | % |
<1
|
% | ||||||||||
DAYTRANA
|
- | 18.4 | n/a | n/a | ||||||||||||
360.0 | 301.5 | 19 | % | 37 | % | |||||||||||
GI
|
||||||||||||||||
LIALDA/MEZAVANT
|
87.1 | 63.6 | 37 | % | 9 | % | ||||||||||
PENTASA
|
64.5 | 58.2 | 11 | % | 7 | % | ||||||||||
RESOLOR
|
0.9 | - | n/a |
<1
|
% | |||||||||||
152.5 | 121.8 | 25 | % | 16 | % | |||||||||||
General products
|
||||||||||||||||
FOSRENOL
|
41.2 | 47.1 | -13 | % | 4 | % | ||||||||||
XAGRID
|
22.7 | 23.3 | -3 | % | 2 | % | ||||||||||
CARBATROL
|
16.6 | 20.1 | -17 | % | 2 | % | ||||||||||
80.5 | 90.5 | -11 | % | 8 | % | |||||||||||
Other product sales
|
23.1 | 27.6 | -16 | % | 2 | % | ||||||||||
Total SP product sales
|
616.1 | 541.4 | 14 | % | 63 | % | ||||||||||
HGT
|
||||||||||||||||
REPLAGAL
|
105.4 | 68.0 | 55 | % | 11 | % | ||||||||||
ELAPRASE
|
103.5 | 100.8 | 3 | % | 11 | % | ||||||||||
VPRIV
|
59.0 | 5.8 | 917 | % | 6 | % | ||||||||||
FIRAZYR
|
5.3 | 2.2 | 141 | % |
<1
|
% | ||||||||||
Total HGT product sales
|
273.2 | 176.8 | 55 | % | 28 | % | ||||||||||
Total product sales
|
889.3 | 718.2 | 24 | % | 91 | % | ||||||||||
Royalties:
|
||||||||||||||||
3TC and ZEFFIX
|
35.5 | 36.6 | -3 | % | 4 | % | ||||||||||
ADDERALL XR
|
16.8 | 40.8 | -59 | % | 2 | % | ||||||||||
Other
|
21.3 | 17.9 | 19 | % | 2 | % | ||||||||||
Total royalties
|
73.6 | 95.3 | -23 | % | 8 | % | ||||||||||
Other revenues
|
9.3 | 2.7 | 244 | % | 1 | % | ||||||||||
Total Revenues
|
972.2 | 816.2 | 19 | % | 100 | % |
US GAAP
|
Adjustments
|
|
Non GAAP
|
|||||||||||||||||||||
3 months to,
|
March 31,
2011
|
Amortization
& asset
impairments
|
Acquisitions
& integration
activities
|
Divestments,
reorganizations
& discontinued
operations
|
Reclassify
depreciation
|
March 31,
2011
|
||||||||||||||||||
|
(a)
|
(b)
|
(c)
|
(d)
|
|
|||||||||||||||||||
$M | $M | $M | $M | $M | $M | |||||||||||||||||||
Total revenues
|
972.2 | - | - | - | - | 972.2 | ||||||||||||||||||
Costs and expenses:
|
||||||||||||||||||||||||
Cost of product sales
|
124.5 | - | - | (2.8 | ) | (5.5 | ) | 116.2 | ||||||||||||||||
Research and development
|
177.9 | - | - | - | (4.7 | ) | 173.2 | |||||||||||||||||
Selling, general and administrative
|
402.9 | (36.1 | ) | - | - | (14.6 | ) | 352.2 | ||||||||||||||||
Loss on sale of product rights
|
1.3 | - | - | (1.3 | ) | - | - | |||||||||||||||||
Reorganization costs
|
5.5 | - | - | (5.5 | ) | - | - | |||||||||||||||||
Integration and acquisition costs
|
(6.4 | ) | - | 6.4 | - | - | - | |||||||||||||||||
Depreciation
|
- | - | - | - | 24.8 | 24.8 | ||||||||||||||||||
Total operating expenses
|
705.7 | (36.1 | ) | 6.4 | (9.6 | ) | - | 666.4 | ||||||||||||||||
Operating income
|
266.5 | 36.1 | (6.4 | ) | 9.6 | - | 305.8 | |||||||||||||||||
Interest income
|
0.6 | - | - | - | - | 0.6 | ||||||||||||||||||
Interest expense
|
(9.2 | ) | - | - | - | - | (9.2 | ) | ||||||||||||||||
Other income/(expense), net
|
0.3 | 2.4 | - | - | - | 2.7 | ||||||||||||||||||
Total other expense, net
|
(8.3 | ) | 2.4 | - | - | - | (5.9 | ) | ||||||||||||||||
Income from continuing operations before income taxes and equity in earnings of equity method investees
|
258.2 | 38.5 | (6.4 | ) | 9.6 | - | 299.9 | |||||||||||||||||
Income taxes
|
(48.1 | ) | (11.9 | ) | (3.8 | ) | (1.9 | ) | (65.7 | ) | ||||||||||||||
Equity in earnings of equity method investees, net of tax
|
1.2 | - | - | - | - | 1.2 | ||||||||||||||||||
Net income attributable to Shire plc
|
211.3 | 26.6 | (10.2 | ) | 7.7 | - | 235.4 | |||||||||||||||||
Impact of convertible debt, net of tax
|
8.4 | - | - | - | - | 8.4 | ||||||||||||||||||
Numerator for diluted EPS
|
219.7 | 26.6 | (10.2 | ) | 7.7 | - | 243.8 | |||||||||||||||||
Weighted average number of shares (millions) – diluted
|
593.6 | - | - | - | - | 593.6 | ||||||||||||||||||
Diluted earnings per ADS
|
111.0 | c | 13.4 | c | (5.1c | ) | 3.9 | c | 123.2 | c |
(a)
|
Amortization and asset impairments: Amortization of intangible assets relating to intellectual property rights acquired ($36.1 million), impairment of available for sale securities ($2.4 million), and tax effect of adjustments;
|
(b)
|
Acquisition and Integration activities: Costs associated with the acquisition of Movetis ($1.8 million), adjustment to contingent consideration payable for EQUASYM ($8.2 million); and tax effect of adjustments;
|
(c)
|
Divestments, reorganizations and discontinued operations: Accelerated depreciation ($2.2 million) and dual running costs ($0.6 million) on the transfer of manufacturing from Owings Mills to a third party, re-measurement of DAYTRANA contingent consideration to fair value ($1.3 million), reorganization costs ($5.5 million) on the transfer of manufacturing from Owings Mills to a third party and establishment of an international commercial hub in Switzerland; and tax effect of adjustments; and
|
(d)
|
Depreciation: Depreciation of $24.8 million included in Cost of product sales, R&D costs and SG&A costs for US GAAP separately disclosed for the presentation of Non GAAP earnings.
|
US GAAP
|
Adjustments
|
|
Non GAAP
|
|||||||||||||||||||||
3 months to,
|
March 31,
2010
|
Amortization
& asset
impairments
|
Acquisitions
& integration
activities
|
Divestments,
reorganizations
& discontinued
operations
|
Reclassify
depreciation
|
March 31,
2010
|
||||||||||||||||||
|
(a)
|
(b)
|
(c)
|
(d)
|
|
|||||||||||||||||||
$M | $M | $M | $M | $M | $M | |||||||||||||||||||
Total revenues
|
816.2 | - | - | - | - | 816.2 | ||||||||||||||||||
Costs and expenses:
|
||||||||||||||||||||||||
Cost of product sales
|
101.9 | - | - | (7.2 | ) | (2.5 | ) | 92.2 | ||||||||||||||||
Research and development
|
131.0 | - | - | - | (3.7 | ) | 127.3 | |||||||||||||||||
Selling, general and administrative
|
359.9 | (34.6 | ) | - | - | (16.3 | ) | 309.0 | ||||||||||||||||
Reorganization costs
|
5.0 | - | - | (5.0 | ) | - | - | |||||||||||||||||
Integration and acquisition costs
|
0.6 | - | (0.6 | ) | - | - | - | |||||||||||||||||
Depreciation
|
- | - | - | - | 22.5 | 22.5 | ||||||||||||||||||
Total operating expenses
|
598.4 | (34.6 | ) | (0.6 | ) | (12.2 | ) | - | 551.0 | |||||||||||||||
Operating income
|
217.8 | 34.6 | 0.6 | 12.2 | - | 265.2 | ||||||||||||||||||
Interest income
|
0.4 | - | - | - | - | 0.4 | ||||||||||||||||||
Interest expense
|
(9.0 | ) | - | - | - | - | (9.0 | ) | ||||||||||||||||
Other income/(expense), net
|
10.8 | - | - | (11.1 | ) | - | (0.3 | ) | ||||||||||||||||
Total other expense, net
|
2.2 | - | - | (11.1 | ) | - | (8.9 | ) | ||||||||||||||||
Income from continuing operations before income taxes and equity in losses of equity method investees
|
220.0 | 34.6 | 0.6 | 1.1 | - | 256.3 | ||||||||||||||||||
Income taxes
|
(53.6 | ) | (9.7 | ) | (0.1 | ) | (3.1 | ) | - | (66.5 | ) | |||||||||||||
Equity in losses of equity method investees, net of tax
|
(0.5 | ) | - | - | - | - | (0.5 | ) | ||||||||||||||||
Net income attributable to Shire plc
|
165.9 | 24.9 | 0.5 | (2.0 | ) | - | 189.3 | |||||||||||||||||
Impact of convertible debt, net of tax
|
8.4 | - | - | - | - | 8.4 | ||||||||||||||||||
Numerator for diluted EPS
|
174.3 | 24.9 | 0.5 | (2.0 | ) | - | 197.7 | |||||||||||||||||
Weighted average number of shares (millions) – diluted
|
586.1 | - | - | - | - | 586.1 | ||||||||||||||||||
Diluted earnings per ADS
|
89.1 | c | 12.8 | c | 0.3 | c | (1.0c | ) | - | 101.2 | c |
(a)
|
Amortization and asset impairments: Amortization of intangible assets relating to intellectual property rights acquired ($34.6 million); and tax effect of adjustment;
|
(b)
|
Acquisitions & integration activities: Costs associated with acquisition of EQUASYM ($0.6 million); and tax effect of adjustments;
|
(c)
|
Divestments, reorganizations and discontinued operations: Accelerated depreciation ($6.1 million), dual running costs ($1.1 million) and reorganization costs ($5.0 million) primarily for the transition of manufacturing from Owings Mills to a third party; gain on disposal of investment in Virochem Pharma Inc. ($11.1 million); and tax effect of adjustments; and
|
(d)
|
Depreciation: Depreciation of $22.5 million included in Cost of product sales, R&D costs and SG&A costs for US GAAP separately disclosed for the presentation of Non GAAP earnings.
|
|
3 months to March 31,
|
|||||||
|
2011
|
2010
|
||||||
|
$M | $M | ||||||
Net cash provided by operating activities
|
201.9 | 186.2 | ||||||
Tax and interest payments, net
|
6.4 | 90.1 | ||||||
Non GAAP cash generation
|
208.3 | 276.3 |
|
3 months to March 31,
|
|||||||
|
2011
|
2010
|
||||||
|
$M | $M | ||||||
Net cash provided by operating activities
|
201.9 | 186.2 | ||||||
Capital expenditure
|
(46.5 | ) | (43.6 | ) | ||||
Non GAAP free cash flow
|
155.4 | 142.6 |
|
March 31,
|
December 31,
|
||||||
|
2011
|
2010
|
||||||
|
$M | $M | ||||||
Cash and cash equivalents
|
712.0 | 550.6 | ||||||
Restricted cash
|
30.8 | 26.8 | ||||||
|
||||||||
Convertible bonds
|
(1,100.0 | ) | (1,100.0 | ) | ||||
Building finance obligation
|
(8.3 | ) | (8.4 | ) | ||||
Net Debt
|
(365.5 | ) | (531.0 | ) |
·
|
Intangible asset amortization and impairment charges; and
|
·
|
Other than temporary impairment of investments.
|
·
|
Upfront payments and milestones in respect of in-licensed and acquired products;
|
·
|
Costs associated with acquisitions, including transaction costs, fair value adjustments on contingent consideration and acquired inventory;
|
·
|
Costs associated with the integration of companies; and
|
·
|
Noncontrolling interest in consolidated variable interest entities.
|
·
|
Gains and losses on the sale of non-core assets;
|
·
|
Costs associated with restructuring and re-organization activities;
|
·
|
Termination costs; and
|
·
|
Income / (losses) from discontinued operations.
|