19th Apr 2006 12:00
Basingstoke, UK - April 19, 2006 - Shire plc (LSE: SHP, NASDAQ: SHPGY; TSX:SHQ) today releases historical financial results for 2005, retrospectivelyadjusted to show the impact of SFAS 123R.From January 1, 2006, Shire is required to adopt SFAS 123R in accounting forshare-based compensation. This accounting standard applies a fair valuemethodology in quantifying the accounting charge associated with the grant ofshare-based compensation to employees which will then be allocated across costof product sales, research and development, and selling, general andadministration costs. The Company has decided to adopt SFAS 123R according tothe modified retrospective method. As a result, comparatives in Shire'sstatements of operations - including the accounting period for the year toDecember 31, 2005, will be retrospectively adjusted to include the adoption ofSFAS 123R.This statement is being published to provide investors with a complete historicquarterly analysis of the 2005 statement of operations, retrospectivelyadjusted to reflect the adoption of SFAS 123R.For further information please contact:Investor Relations Clƒ©a Rosenfeld (Rest of the World) +44 1256 894 160 Brian Piper (North America) +1 484 595 8252Notes to editorsShire plcShire's strategic goal is to become the leading specialty pharmaceuticalcompany that focuses on meeting the needs of the specialist physician. Shire'stherapeutic focus is on central nervous system (CNS), gastrointestinal (GI),human genetic therapies (HGT) and general products (GP). The structure issufficiently flexible to allow Shire to target new therapeutic areas to theextent that opportunities arise through acquisitions. Shire believes that acarefully selected portfolio of products with a strategically aligned andrelatively small-scale sales force will deliver strong results.Shire's focused strategy is to develop and market products for specialtyphysicians. Shire's in-licensing, merger and acquisition efforts are focused onproducts in niche markets with strong intellectual property protection eitherin the US or Europe.For further information on Shire, please visit the Company's website: www.shire.comTHE "SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACTOF 1995Statements included herein that are not historical facts are forward-lookingstatements. Such forward-looking statements involve a number of risks anduncertainties and are subject to change at any time. In the event such risks oruncertainties materialize, Shire's results could be materially affected. Therisks and uncertainties include, but are not limited to, risks associated with:the inherent uncertainty of pharmaceutical research, product development,manufacturing and commercialization; the impact of competitive products,including, but not limited to, the impact of those on Shire's Attention Deficitand Hyperactivity Disorder (ADHD) franchise; patents, including, but notlimited to, legal challenges relating to Shire's ADHD franchise; governmentregulation and approval, including, but not limited to, the expected productapproval dates of SPD503 (ADHD), SPD465 (ADHD), MESAVANCE¢â€ž¢ (SPD476) (ulcerativecolitis), ELAPRASE¢â€ž¢ (I2S) (Hunter syndrome), and NRP104 (ADHD), including itsscheduling classification by the Drug Enforcement Administration in the UnitedStates; Shire's ability to benefit from its acquisition of TranskaryoticTherapies, Inc.; Shire's ability to secure new products for commercializationand/or development; and other risks and uncertainties detailed from time totime in Shire's filings and its predecessor registrant Shire PharmaceuticalsGroup plc's filings with the US Securities and Exchange Commission, includingShire's Annual Report on Form 10-K for the year to December 31, 2005.Unaudited results for 2005 by Quarter Adjusted Adjusted Adjusted Adjusted Adjusted Q1 2005 Q2 2005 Q3 2005 Q4 2005 YR 2005 $M $M $M $M $M Revenues: Product sales 269.4 351.6 309.2 397.5 1,327.7 Royalties 58.3 62.6 60.2 61.8 242.9 Other revenues 6.0 10.4 6.7 5.6 28.7 ______ ______ Total revenues 333.7 424.6 376.1 464.9 1,599.3 Costs and expenses: Cost of product sales 33.6 42.3 60.5 79.1 215.5 Research and 112.1 66.0 75.1 85.9 339.1 development Selling, general and 163.2 159.1 161.3 171.9 655.5 administrative Depreciation and 13.6 20.1 16.4 24.3 74.4 amortization Intangible asset - 3.0 - 2.6 5.6 impairment Reorganization costs 2.9 - 6.5 - 9.4 Integration costs - - 3.5 6.2 9.7 In-process R&D - - 673.0 - 673.0 write-off Total operating 325.4 290.5 996.3 370.0 1,982.2 expenses Operating income/ 8.3 134.1 (620.2) 94.9 (382.9) (loss) Interest income 9.7 11.3 6.9 7.4 35.3 Interest expense - (1.2) (3.5) (7.3) (12.0) Other (expense)/ (0.1) 0.8 3.2 6.0 9.9 income, net Total other income, 9.6 10.9 6.6 6.1 33.2 net Income/(loss) from 17.9 145.0 (613.6) 101.0 (349.7) continuing operations before income taxes and equity in (losses) /earnings of equity method investees Income taxes (5.4) (36.0) (17.5) (29.9) (88.8) Equity in (losses)/ (0.2) 0.9 (0.6) (1.1) (1.0) earnings of equity method investees Income/(loss) from 12.3 109.9 (631.7) 70.0 (439.5) continuing operations Income/(loss) from 3.1 - 1.0 (1.0) 3.1 discontinued operations Net income/(loss) 15.4 109.9 (630.7) 69.0 (436.4) Earnings per ordinary share US GAAP Net income - basic 3.1c 22.0c (126.0c) 13.8c (1) (87.2c) Net income - diluted 3.1c 22.0c (126.0c) 13.7c (87.2c) Non GAAP Net income - diluted 10.1c 22.0c 12.8c 17.8c (1) 62.6c Earnings per ADS US GAAP Net income - basic 9.3c 65.9c (378.0c) 41.3c (1) (261.7c) Net income - diluted 9.2c 65.9c (378.0c) 41.1c (1) (261.7c) Non GAAP Net income - diluted 30.2c 65.9c 38.3c 53.4c 187.8c (1) These results do not cross cast due to a difference in the denominator usedin the calculation.1. The table below shows the SFAS 123R costs per category Adjusted Adjusted Adjusted Adjusted Adjusted Q1 2005 Q2 2005 Q3 2005 Q4 2005 YR 2005 $M $M $M $M $M Cost of product sales 0.3 0.3 0.4 0.5 1.5 Research and 0.6 0.6 0.8 0.9 2.9 development Selling, general and 5.6 5.6 6.4 6.8 24.4 administrative Total operating 6.5 6.5 7.6 8.2 28.8 expenses Income tax credit 1.4 0.2 1.1 0.5 3.2 Total charge to net (5.1) (6.3) (6.5) (7.7) (25.6) income Diluted earnings (1.0c) (1.0c) (1.3c) (1.4c) (1) (5.1c) adjustment per ordinary share - US GAAP Diluted earnings (3.0c) (3.2c) (3.9c) (4.1c) (1) adjustment per ADS - US (15.3c) GAAP Diluted earnings (0.9c) (1.0c) (1.1c) (1.3c) (1) (4.5c) adjustment per ordinary share -- Non US GAAP Diluted earnings (2.8c) (3.2c) (3.5c) (4.0c) (1) adjustment per ADS -- (13.6c) Non US GAAP (1) These results do not cross cast due to a difference in the denominator usedin the calculation.2. Non GAAPFor each quarter of 2005, Shire also reported a non GAAP measure whichmanagement believe provided useful information to investors regarding Shire'sunderlying performance.The retrospectively adjusted non GAAP numerators for diluted EPS, non GAAPEarnings per ordinary share and non GAAP Earnings per ADS for each quarter of2005 and for the full year 2005 are less than that originally disclosed by theamounts shown in note 1 above.2a. Non GAAP reconciliation of numerator for diluted EPS Adjusted Adjusted Adjusted Adjusted Adjusted Q1 2005 Q2 2005 Q3 2005 Q4 2005 YR 2005 $M $'M $M $M $M Net income/(loss) for 15.4 109.9 (630.7) 69.0 (436.4) basic EPS Add back: Loss/(gain) from (3.1) - (1.0) 1.0 (3.1) discontinued operations, net of tax 12.3 109.9 (631.7) 70.0 (439.5) Add back: TKT in-process R&D - - 673.0 - 673.0 write-off TKT cost of product - - 17.2 24.7 41.9 sales fair value adjustment New River upfront 50.0 - - - 50.0 payments New listed holding - - 4.5 - 4.5 company costs Reorganization costs 2.9 - 6.5 - 9.4 TKT integration costs - - 3.5 6.2 9.7 Gain on sale of drug - - - (3.6) (3.6) formulation business Taxes on above (14.8) - (8.9) (7.7) (31.4) adjustments Numerator for non GAAP 50.4 109.9 64.1 89.6 314.0 - diluted EPS 2b. Non GAAP reconciliation of reported EPS Adjusted Adjusted Adjusted Adjusted Adjusted Q1 2005 Q2 2005 Q3 2005 Q4 2005 YR 2005 Diluted EPS per ordinary 3.1c 22.0c (126.0c) 13.7c (87.2c) share Add back: Loss/(gain) from (0.6c) - (0.2c) 0.2c (0.6c) discontinued operations, net of tax - Diluted EPS from 2.5c 22.0c (126.2c) 13.9c (87.8c) continuing operations Change in denominator due - - 1.6c - 1.6c to effect on dilution of non GAAP adjustments (2) 2.5c 22.0c (124.6c) 13.9c (86.2c) Add back: TKT in-process R&D - - 132.7c - (1) write-off 133.0c TKT cost of product sales - - 3.4c 4.9c 8.3c fair value adjustment New River upfront 9.9c - - - 9.9c payments New listed holding - - 0.9c - 0.9c company costs Reorganization costs 0.5c - 1.3c - 1.8c TKT integration costs - - 0.7c 1.2c 1.9c Gain on sale of drug - - - (0.7c) (0.7c) formulation business Taxes on above (2.8c) - (1.6c) (1.5c) (1) adjustments (6.3c) Non GAAP - diluted EPS 10.1c 22.0c 12.8c 17.8c (1) 62.6c per ordinary share Non GAAP - diluted EPS 30.2c 65.9c 38.3c 53.4c 187.8c per ADS Memo: previously reported 33.0c 69.1c 41.8c 57.4c 201.4c non GAAP EPS per ADS (prior to adoption of FAS123R) (1) These results do not cross cast due to a difference in the denominator usedin the calculation.(2) Since the items added back result in positive non GAAP net income for Q32005 and the year to December 31, 2005, the options, warrants and convertibledebt become dilutive under this measure and are therefore included in thecalculation of the denominator for the non GAAP EPS.(3) The difference between these is reconciled in note 1 above. ENDS Hampshire International Business Park Chineham Basingstoke Hampshire RG24 8EP United Kingdom Tel +44 (0)1256 894000 Fax +44 (0)1256 894708 www.shire.com Press Release ENDSHIRE PLCRelated Shares:
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