23rd Feb 2006 12:00
12 noon GMT 7am EST Strong 2005 performance supports positive outlook Basingstoke, UK - February 23, 2006 - Shire plc (LSE: SHP, NASDAQ: SHPGY, TSX:SHQ) announces results for the twelve months to December 31, 2005 - a year inwhich significant milestones were met, providing clear future developmentopportunities.2005 Financial Highlights * Product sales up 19% to $1,327.7 million; * Royalties up 5% to $242.9 million; * Total revenues up 17% to $1,599.3 million; * Dividend up 10%. Matthew Emmens, Chief Executive Officer, said:"This has been another successful year for Shire. We met all of our strategicobjectives and continued to grow with product sales up 19%. During the year wemade excellent progress in setting the stage for our future growth. Theacquisition of TKT and the collaboration with New River Pharmaceuticals forNRP104 greatly enhances our product portfolio and we continue to file andlaunch several new products in the US and Europe."Our lead product, ADDERALL XR, achieved an all time high market share of 26%.In January we announced that we settled all pending legal proceedings withImpax Laboratories. This was an excellent outcome for both parties. Patentlitigation continues and settlement discussions with Barr Laboratories areprogressing."Over the past few years, we have transformed Shire by broadening our productrange, expanding our geographic reach, enhancing our business processes andcapitalizing on opportunities within the specialty pharmaceutical markets.Shire's success in meeting key milestones in 2005 reflects our continuedcommitment to achieving our goal of becoming the leading specialtypharmaceutical company."2005 Product Highlights * MESAVANCE (SPD476) for Ulcerative Colitis, filed with the Food and Drug Administration (FDA); * DAYTRANA for Attention Deficit Hyperactivity Disorder (ADHD) received an approvable letter from the FDA; * NRP104 for ADHD filed with the FDA by New River Pharmaceuticals Inc. (New River); * ELAPRASE filed with the FDA and the European Medicines Agency (EMEA); * XAGRID for Thrombocythemia, roll-out commenced in Europe; * FOSRENOL for Hyperphosphatemia, launched in the US and launch in Europe commenced; * FOSRENOL higher strengths (750mg and 1000mg) launched in the US. 2005 Business Development * Collaboration agreement signed with New River for its ADHD compound, NRP104; * Acquisition of Transkaryotic Therapies Inc., (TKT) completed - providing entry to the human genetic therapy market and extending Shire's portfolio for the specialist physician; * Sale of drug formulation business (Shire Laboratories) to Supernus Pharmaceuticals, Inc. Recent Developments in 2006 * ADDERALL XR for ADHD. All litigation with Impax Laboratories Inc., (Impax) regarding Shire's patents settled in January. Patent litigation continues and settlement discussions with Barr Laboratories Inc., (Barr) are progressing; * CARBATROL for Epilepsy. A promotional services agreement for the US market with Impax was signed in January. The agreement will take effect from July 2006; * MESAVANCE. Marketing Authorization Application submitted to Canadian and European Regulatory Agencies; * ELAPRASE. In January 2006 the filing was accepted for Priority Review by the FDA. The expected PDUFA date is May 25, 2006; * On February 10, 2006 the Company received notice from ID Biomedical Corporation (IDB) that it intended to repay in full all of its loan drawings for injectable flu development of $70.6 million, together with accrued and capitalized interest of $8.1 million. The Company received the $78.7 million outstanding on February 14, 2006. The amounts outstanding in respect of IDB's drawings for pipeline development (principal drawings of $29.4 million), are unaffected by this repayment. Full Year 2005 Unaudited Results 2005 2004 US GAAP Adjustments Non GAAP US GAAP Adjustments Non GAAP (1) (1) $M $M $M $M $M $M _______ _______ _______ _______ _______ _______ Revenues 1,599.3 - 1,599.3 1,363.2 - 1,363.2 (Loss)/income (320.9) 784.9 464.0 459.9 33.7 493.6from ongoing operations before income taxes(2) Net (loss)/i (410.8) 750.4 339.6 269.0 88.5 357.5ncome Diluted (losses) / earnings per: Ordinary share (82.1c) 149.2c 67.1c 53.3c 17.3c 70.6c ADS (246.4c) 447.8c 201.4c 159.9c 51.9c 211.8c Note: Average exchange rates for 2005 and 2004 were $1.82: ‚£1.00 and $1.83: ‚£ 1.00, respectively. (1) Non GAAPThese are non GAAP financial measures.For 2005, this measure for net (loss)/income excludes a net negative amount of $750.4m as follows: * The write-off of in-process research and development (R&D) following the acquisition of TKT: $673.0m; * Cost of product sales fair value adjustment following the acquisition of TKT: $41.9m; * New River upfront payment: $50.0m; * New listed holding company costs: $4.5m; * Reorganization costs resulting from Shire's North American site consolidation: $9.4m; * TKT integration costs: $9.7m; * Gain on disposal of drug formulation business: $(3.6)m; * Taxes on above adjustments: $(31.4)m; * Income from discontinued operations: $(3.1)m. For 2004, this measure for net income excludes a net negative amount of $88.5mas follows: * Reorganization costs resulting from Shire's North American site consolidation: $48.5m; * Gain on sale of investment: $(14.8)m; * Taxes on above adjustments: $(9.5)m; * Loss from discontinued operations: $64.3m. On a pre-tax basis, excluding discontinued operations, the above non GAAPadjustments relating to continuing operations total $784.9m for 2005 and $33.7mfor 2004.Management believes that the presentation of these non GAAP financial measuresprovides useful information to investors regarding Shire's performance, as theexcluded items are not indicative of the ongoing business in 2005. Areconciliation of these non GAAP financial measures to the most directlycomparable US GAAP financial measure can be found on pages 27 and 28.(2) (Loss)/income from continuing operations before income taxes and equitymethod investees.Q4 2005 Unaudited Results 2005 2004 US GAAP Adjustments Non GAAP US GAAP Adjustments Non GAAP (1) (1) $M $M $M $M $M $M _______ _______ _______ _______ _______ _______ Revenues 465.0 - 465.0 373.7 - 373.7 Income from 109.3 27.3 136.6 116.2 16.4 132.6ongoing operations before income taxes (2) Net Income 76.7 20.7 97.4 83.4 11.8 95.2 Diluted earnings per: Ordinary share 15.1c 4.0c 19.1c 16.7c 2.3c 19.0c ADS 45.2c 12.2c 57.4c 49.8c 7.2c 57.0c Note: Average exchange rates for Q4 2005 and Q4 2004 were $1.75: ‚£1.00 and $1.87: ‚£1.00, respectively. (1) Non GAAPThese are non GAAP financial measures.For 2005, this measure for net income excludes a net negative amount of $20.7mas follows: * Cost of product sales fair value adjustment following the acquisition of TKT: $24.7m; * TKT integration costs: $6.2m; * Gain on disposal of drug formulation business: $(3.6)m; * Taxes on above adjustments: $(7.6)m * Impact of discontinued operations: $1.0m. For 2004, this measure for net income excludes a net negative amount of $11.8mas follows: * Reorganization costs resulting from Shire's North American site consolidation: $16.4m; * Taxes on above adjustment: $(4.6)m. On a pre-tax basis, excluding discontinued items, the above non GAAPadjustments relating to continuing operations total $27.3m for 2005 and $16.4mfor 2004.Management believes that the presentation of these non GAAP financial measuresprovides useful information to investors regarding Shire's performance, as theexcluded items are not indicative of the ongoing business in 2005. Areconciliation of these non GAAP financial measures to the most directlycomparable US GAAP financial measures can be found on pages 27 and 28.(2) Income from continuing operations before income taxes and equity methodinvestees.2006 OutlookR&D pipeline and new product launchesShire has a strong product pipeline to support the medium and long-term futuregrowth of the Company. In 2006 and H1 2007 Shire anticipates: * Launching DAYTRANA for ADHD in the US; * Launching ELAPRASE in the US and Europe; * Launching MESAVANCE in the US; * Launching NRP104 in the US; * Filing SPD503 for ADHD with the FDA; * Filing SPD465 for ADHD with the FDA; * Undertaking additional pre-launch preparations and activities during Q4 2006 in order to maximize commercial opportunities for DYNEPO, a treatment for anemia in chronic renal failure. Full European launch of this product is now expected H1 2007; * Continuing the roll-out of FOSRENOL in Europe; * Continuing the launch of FOSRENOL higher strengths in the US. The above launch and filing dates are indicative and subject to the regulatory/government approvals process.Financial outlookThe following statements are based on the assumption that there will be nogeneric launch of ADDERALL XR during 2006 and prescription growth in the USADHD market will be 5%.Shire's business continues to perform strongly. We expect 2006 revenue growthto be in the low double-digit range.As previously announced, earnings for 2006 will be impacted by the costsassociated with the continued development and launch of five new products in2006 and H1 2007 in addition to the roll-out of FOSRENOL across Europe and thenew higher strengths of FOSRENOL in the US. * These launches will require additional advertising and promotional spend and, in some cases, additional sales representatives. In addition, Shire will be seeking to maximize ADDERALL XR's market share. Consequently, SG&A costs are expected to rise during the year to between $770 - 800 million; * The planned regulatory filings, Phase 3(b) and Phase 4 studies to support new product launches, the transfer of two Human Genetic Therapies (HGT) projects into pre-clinical development and the commencement of Phase 3 trials on GA-GCB, are expected to result in R&D spend in the range of $310 - 330 million; * The depreciation and amortization charge for the year will increase by approximately 50% compared to 2005 reflecting the acquisition of TKT and the amortization of anticipated capitalized business development milestone payments; * The tax rate to be maintained at a rate of approximately 28%. The financial outlook for the full year stated above excludes the accountingimpact under US GAAP of the following items: * The milestone payment of $50 million paid to New River in February 2006 following the FDA's acceptance of the filing of NRP104. This will increase R&D expense in Q1 2006; * A US GAAP adjustment of approximately $50m to reflect the difference between the accounting fair value and book value of acquired REPLAGAL inventory. This will increase cost of product sales; * Shire HGT integration costs estimated at $10 million in 2006. This will increase SG&A costs; * The adoption from January 1, 2006 of US GAAP accounting standard FAS123R for share based compensation. This is expected to give rise to additional charges estimated at approximately $45m, which will be split between costs of product sales, R&D and SG&A in the approximate ratios of 5%, 25% and 70%, respectively. Including these items would result, under US GAAP, in estimated increases incost of product sales of $50 million, R&D spend in the range of $370 - 390million and SG&A costs between $810 - 840 million.Any launch of a generic version of ADDERALL XR during 2006 would have amaterial impact on the company's performance and would materially impact therevenue growth guidance given above.DividendIn respect of the six months to December 31, 2005 the Board resolved to pay asecond interim dividend of 4.419 US cents per ordinary share (2004: 3.85 UScents per share). Together with the first interim payment of 1.8246 US centsper ordinary share (2004: 1.82 US cents per share), this represents totaldividends for 2005 of 6.2436 US cents per share (2004: 5.67 US cents pershare), an increase of 10% in US Dollar terms over 2004.Dividend payments will be made in Pounds Sterling to Ordinary Shareholders, USDollars to ADS holders and Canadian Dollars to Exchangeable Shareholders. Adividend of 2.5356 pence per ordinary share, 13.257 US cents per ADS and15.2217 Canadian cents per Exchangeable Share respectively will be paid. TheBoard resolved to pay the dividend on April 6, 2006 to persons whose namesappear on the register of members of the Company (or to persons registered asholders of Exchangeable Shares in Shire Acquisition Inc.) at the close ofbusiness on March 17, 2006.Shire intends to pursue a progressive dividend policy. Any growth willtypically come through increasing the second interim payment for each financialyear.New Accounting Standard - SFAS 123RShire's primary basis of financial reporting is US GAAP. From January 1, 2006,in conjunction with many other US GAAP reporting companies, Shire is requiredto adopt SFAS 123R in accounting for share-based compensation. This accountingstandard applies a fair value methodology in quantifying the accounting chargeassociated with the grant of share-based compensation to employees.Shire has previously disclosed in its Annual Report on Form 10-K for 2004 filedwith the SEC the charge that would have resulted from the full adoption of afair value methodology under SFAS 123R. The application of this methodologywould have resulted in a pre-tax, non-cash charge of $27 million for 2005, $33million for 2004 and $32 million for 2003. The higher relative charges for 2003and 2004 arise due to an all employee grant in 2001 for which the FAS123 chargewas spread over the 3-year vesting period.It is anticipated that the 2006 annual SFAS 123R charge will be approximately$45m. The increase over the comparable figure for 2005 is due partly to theacquisition of TKT and the resulting expansion of the work force, and partly tothe share price growth seen over the last three years. The share price onFebruary 21, 2006 of ‚£8.73 was higher than the share prices at December 31,2002, 2003 and 2004 by 120%, 61% and 60% respectively.The valuation of stock based compensation under SFAS 123R is based on a numberof market related assumptions (including share price and share price volatilityat the time of grant) and internal assumptions (including numbers of newemployees and employee attrition rates), which can only be estimated at thisstage. Accordingly the actual valuation above is subject to variation.The Company has decided to adopt SFAS 123R according to the modifiedretrospective method. As a result, comparatives including the accounting periodfor the year to December 31, 2005 will be restated during Q1 2006. - Ends - 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 8252 Media Jessica Mann (Rest of the World) +44 1256 894 280 Matthew Cabrey (North America) +1 484 595 8248Notes 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 DAYTRANA (MTS/METHYPATCH) (ADHD), SPD503 (ADHD), SPD465(ADHD), MESAVANCE (SPD476) (ulcerative colitis), ELAPRASE (I2S) (Huntersyndrome), and NRP104 (ADHD), including its scheduling classification by theDrug Enforcement Administration in the United States; Shire's ability tobenefit from its acquisition of Transkaryotic Therapies, Inc.; Shire's abilityto secure new products for commercialization and/or development; and otherrisks and uncertainties detailed from time to time in Shire's filings and itspredecessor registrant Shire Pharmaceuticals Group plc's filings with theSecurities and Exchange Commission, including its Annual Report on Form 10-Kfor the year to December 31, 2004.The following are trademarks of Shire or companies within the Shire Group,which are the subject of trademark registrations in certain territories:ADDERALL XR‚® (mixed salts of a single-entity amphetamine)ADDERALL‚® (mixed salts of a single-entity amphetamine)AGRYLIN‚® (anagrelide hydrochloride)CALCICHEW‚® range (calcium carbonate with or without vitamin D3)CARBATROL‚® (carbamazepine extended-release capsules)COLAZIDE‚® (balsalazide)DAYTRANA¢â€ž¢ (methylphenidate transdermal system)ELAPRASE¢â€ž¢ (I2S) (idursulfase)EQUETRO¢â€ž¢ (carbamazepine extended-release capsules)FOSRENOL‚® (lanthanum carbonate)GA-GCB‚® (gene-activated)LODINE ‚® (etodolac)MESAVANCE¢â€ž¢ (mesalamine)REMINYL‚® (galantamine hydrobromide) (UK and Republic of Ireland)REMINYL XL¢â€ž¢ (galantamine hydrobromide) (UK and Republic of Ireland)REPLAGAL‚® (agalsidase alfa)SOLARAZE‚® (3%, gel diclofenac sodium (3%w/w))XAGRID‚® (anagrelide hydrochloride)The following are trademarks of third parties referred to in this pressrelease:3TC (trademark of GlaxoSmithKline (GSK))AMARYL (trademark of Sanofi-Aventis)DYNEPO (trademark of Aventis Pharma Holdings GmbH)PENTASA (trademark of Ferring AS)RAZADYNE (trademark of Johnson & Johnson)RAZADYNE ER (trademark of Johnson & Johnson)REMINYL (trademark of Johnson & Johnson, excluding UK and Republic of Ireland)REMINYL XL (galantamine hydrobromide) (trademark of Johnson & Johnson,excluding UK and Republic of Ireland)ZEFFIX (trademark of GSK)OVERVIEW OF US GAAP FINANCIAL RESULTS1. IntroductionSummary of 2005Revenues from continuing operations for the year to December 31, 2005 increasedby 17% to $1,599.3 million (2004: $1,363.2 million), of which $41.3 million wasderived from sales of REPLAGAL in the five months following the acquisition ofTKT. Excluding REPLAGAL sales, revenues increased by 14%.Losses from continuing operations for the year to December 31, 2005 were $414.0million (2004 income of $333.3 million). A loss has arisen due to a $673.0million write-off of in-process R&D acquired with TKT and a $50 millionup-front milestone payment to New River. The in-process R&D adjustment isrequired under US GAAP and represents the value of acquired intangible assetsunder development and not filed for regulatory approval at the time of the TKTacquisition, including ELAPRASE and GA-GCB.Cash inflow from operating activities for the year to December 31, 2005 reducedby 22% to $381.1 million (2004: $488.7 million). Cash inflow was affected bythe $50 million payment to New River, the operating losses of the acquired TKTbusiness and the timing of working capital payments.Cash and cash equivalents, restricted cash and short-term investments atDecember 31, 2005 totaled $694.0 million (December 31, 2004: $1,457.5 million).The movement during 2005 was primarily due to $1.2 billion paid to date topurchase TKT partially offset by positive cash flows from Shire's operations,$111.8 million of cash and cash equivalents, restricted cash and short-terminvestments acquired with TKT and the receipt during 2005 of $92.2 million fromthe sale of Shire's vaccines business to IDB in 2004.The total cash consideration for the acquisition of TKT is expected to beapproximately $1.6 billion. At December 31, 2005, $1.2 billion had been paid.The remaining $0.4 billion is due to ex-TKT shareholders who have requested anappraisal of the $37 per share acquisition consideration pursuant to a courtappraisal process and is shown as a liability, along with a provision forinterest that may be payable. These dissenting shareholders previously owned31% of TKT's ordinary share capital, (11.3 million shares).Summary of Q4 2005Revenues from continuing operations for the three months to December 31, 2005increased by 24% to $465.0 million (2004: $373.7 million), of which $25.4million was derived from sales of REPLAGAL (which was acquired with TKT).Excluding REPLAGAL sales, revenues increased by 18%.Income from continuing operations for the three months to December 31, 2005decreased by 7% to $77.7 million (2004: $83.4 million). The decrease was due tooperating losses of the acquired TKT business of $17.4 million during the threemonths to December 31, 2005.Cash inflow from operating activities for the three months to December 31, 2005reduced by 23% to $154.5 million (2004: $201.1 million). The reduction was dueto losses of the acquired TKT business, ($17.4 million) and the timing ofworking capital payments.2. Product salesFor the year to December 31, 2005 product sales increased by 19% to $1,327.7million (2004: $1,112.5 million) and represented 83% of total revenues (2004:82%). Excluding post acquisition sales of REPLAGAL ($41.3 million), productsales for 2005 increased by 16%.Product Highlights Sales Sales US Rx US Market Product $M Growth (2) Growth (1) Share (1) (2) ADDERALL XR 730.8 +20% +12% 26% CARBATROL 72.1 +33% -8% 42% PENTASA 136.1 +18% +6% 18% AGRYLIN and XAGRID North America (3) 46.0 -61% -48% 4% Rest of World 46.8 +40% N/A N/A FOSRENOL 53.5 N/A N/A 8% REPLAGAL (4) 41.3 N/A N/A N/A (1) IMS Prescription Data - Product specific (December 2005).(2) Compared to 2004.(3) Includes US and Canada.(4) This represents REPLAGAL sales for the five-month period since acquisition.The total sales for the full year, including TKT pre-acquisition sales, were$94.6 million (2004: $77.4 million).ADDERALL XR for the treatment of ADHDUS prescriptions for ADDERALL XR for the year to December 31, 2005 were up 12%.ADDERALL XR, further strengthened its position as the leading brand in the USADHD market with a 1% increase in market share to an all time high of 26% inDecember 2005 (December 2004: 25%). In addition, the US ADHD market grew 5%overall compared to the same period in 2004.Product sales growth was higher than prescription growth for the year duemainly to the impact of price increases in December 2004 and August 2005,partially offset by a decrease in pipeline inventory and higher salesdeductions.During 2005, Shire negotiated `fee for service' agreements with two of itsthree major US wholesalers. These industry-wide agreements change the waysignificant wholesale distributors are compensated by pharmaceuticalmanufacturers and should allow for more efficient management of inventorylevels held by wholesale distributors.FDA approval of the adolescent indication for ADDERALL XR was received on July22, 2005.On February 12, 2005, Shire announced that it had suspended sales of ADDERALLXR in Canada at the request of Health Canada. On August 24, 2005, Shireannounced that Health Canada would reinstate the marketing authorization ofADDERALL XR in Canada effective August 26, 2005. This reinstatement follows theacceptance by Health Canada of the recommendations from the New Drug Committee,which was appointed by Health Canada at Shire's request to review thesuspension of ADDERALL XR in Canada.During October 2005 Shire filed a Citizen Petition with the FDA requesting thatthe FDA require more rigorous bioequivalence testing or additional clinicaltesting for generic or follow-on drug products that reference ADDERALL XRbefore they can be approved. Shire believes that these requested criteria willensure that generic formulations of ADDERALL XR or follow-on drug products willbe clinically effective and safe. In January 2006, Shire chose to file asupplemental amendment to its original Citizen Petition, which includedadditional clinical data in support of the original filing. The FDA has sixmonths to respond to Shire's petition and while this petition is under reviewit will not grant final approval of generic or follow-on drug productsreferencing ADDERALL XR.On February 9, 2006, an FDA Advisory Committee recommended to the FDA that riskinformation about cardiovascular events be included in a "black box warning"for all stimulant medicines used to treat ADHD. In making its recommendation,the Advisory Committee recognized that the reported incidence rates of the rareserious cardiovascular adverse events that were discussed by the Committee aregenerally within the rates that would be expected from the untreated generalpopulation. ADDERALL XR and ADDERALL already include a "black box warning" intheir labels for safety concerns related to amphetamine abuse or misuse andalso warn of the risk of sudden death in patients with structural cardiacabnormalities. Shire stands behind the current labeling and believes thatfurther action is unwarranted.In January 2006, Shire settled its ADDERALL XR patent infringement lawsuitswith Impax. The litigations involved Shire US patents, Nos. 6,322,819 ("the`819 Patent"), 6,605,300 ("the `300 Patent") and 6,913,768 ("the `768 Patent").As part of the settlement, Impax has confirmed that its proposed genericADDERALL XR product infringes Shire's `819, `300 and `768 Patents and that thethree patents are valid and enforceable. Under the terms of the settlement,Impax will be permitted to market generic versions of ADDERALL XR in the US nolater than January 1, 2010 and will pay Shire a royalty from those sales. Incertain situations, such as the launch of another generic version of ADDERALLXR, Impax may be permitted to enter the market as Shire's authorized generic.Shire's ADDERALL XR patent infringement lawsuits with Barr continue. Shire isseeking a ruling that Barr's Abbreviated New Drug Application (ANDA) seekingpermission to market its generic versions of ADDERALL XR infringes the `819,`300 and `768 Patents. Barr's 30-month stay under the Hatch-Waxman Act expiredon February 18, 2006. Following the expiry of the 30 month stay, the FDA mayapprove Barr's ANDA. A final pre-trial conference in the `819 and `300 patentcases is set for March 10, 2006. No trial date has been set. Shire iscontinuing its discussions with Barr in connection with these lawsuits and thediscussions are progressing. Further information can be found in our filingswith the US Securities and Exchange Commission, including our Annual Report onForm 10-K for the year to December 31, 2004 and our most recent quarterlyreport on Form 10-Q for the period ended September 30, 2005.CARBATROL for the treatment of EpilepsyUS prescriptions for the year to December 31, 2005 were down 8% compared to theprevious year. This was due primarily to supply constraints, a 4% decrease inShire's market share of the total US extended release carbamazepineprescription market to 42% in December 2005 (December 2004: 46%) and a 5%decrease in that market as a whole. The supply constraints have now beenresolved.Product sales for the year to December 31, 2005 were up 33% compared to theprevious year. The difference between sales growth and the lower level ofprescriptions is due to price increases in August 2004 and October 2005 and tolower sales deductions than in 2004.Patent litigation proceedings with Nostrum Pharmaceuticals, Inc. (Nostrum)relating to CARBATROL are ongoing. No trial date has been set. Nostrum's30-month stay under the Hatch-Waxman Act expired on February 6, 2006.Accordingly, the FDA may approve Nostrum's ANDA. Further information can befound in our filings with the US Securities and Exchange Commission, includingour Annual Report on Form 10-K for the year to December 31, 2004 and our mostrecent quarterly report on Form 10-Q for the period ended September 30, 2005.PENTASA for the treatment of Ulcerative ColitisUS prescriptions for the year to December 31, 2005 were up 6% compared to theprevious year. The increase was due to the success of the co-promotionalagreement with Solvay Pharmaceuticals Inc., the impact of the 500mg dosage formlaunched in the third quarter of 2004 and a 2% increase in the total US oralmesalamine prescription market.Product sales for the year to December 31, 2005 were up 18%, compared to theprevious year. The difference between sales growth and prescription growth isdue to the impact of the September 2004 price increase and a normalization ofpipeline inventories compared to lower levels in 2004.PENTASA had an 18% share of the total US oral mesalamine prescription market inDecember 2005 (December 2004: 18%).AGRYLIN/XAGRID for the treatment of ThrombocythemiaAGRYLIN/XAGRID sales worldwide for the year to December 31, 2005 were $92.8million, down 39% compared to the previous year (2004: $152.5 million).North American sales were $46.0 million, down 61% compared to the previous year(2004: $119.1 million). This reduction was expected following the approval ofgeneric versions of AGRYLIN in the US market in April 2005.Rest of the World sales (all sales outside North America) were $46.8 million,up 40%, compared to the previous year (2004: $33.4 million). This was primarilydue to the successful launch of XAGRID in the UK, Germany and France in thefirst quarter of 2005 and Spain in the third quarter of 2005. In accordancewith current orphan drug legislation in the EU, XAGRID will have up to 10 yearsof marketing exclusivity in the EU.FOSRENOL for the treatment of HyperphosphatemiaFOSRENOL was launched in the US in January 2005. Product sales for the year toDecember 31, 2005 were $53.5 million, with US prescriptions for the yeartotaling 137,000.FOSRENOL had an 8% share of the total US phosphate binding market in December2005.On November 28, 2005 the FDA approved new, higher dose formulations ofFOSRENOL. New, higher dose strengths of 750 milligrams and 1000 milligrams wereshipped to wholesalers in the US in December 2005. Higher dose strengths shouldhelp to reduce the number of pills that end-stage renal disease patients needto take to achieve target phosphorus levels.Product sales in Q4 2005 were $29.0 million compared with $9.7 million in Q32005. The variance relates primarily to increased pipeline inventory sales towholesalers of the new higher dose formulation during December.FOSRENOL was launched in Austria in December 2005. Shire continues itsdiscussions relating to FOSRENOL with regulatory authorities and reimbursementagencies across Europe and other regions and further launches are expected inEuropean markets over the next few months, subject to obtaining nationalapprovals and concluding pricing and reimbursement negotiations.REPLAGAL for the treatment of Fabry DiseaseREPLAGAL was acquired by Shire as part of the TKT acquisition, which completedon July 27, 2005. Product sales for the period since acquisition were $41.3million. The majority of REPLAGAL sales are in Europe. Total sales for the fullyear, including pre-acquisition sales, were $94.6 million (2004: $77.4million). The increase in sales (including pre-acquisition sales) is primarilydue to greater European coverage by an increased number of salesrepresentatives.3. RoyaltiesRoyalty revenue increased 5% to $242.9 million for the year to December 31,2005 (2004: $230.4 million) as a result of growth in sales.Royalty HighlightsProduct Royalties to Royalty (4) Worldwide in-market Shire Growth sales by licensee (3) in $M % 2005 $M 3TC 159.8 +3%(1) 1,211 ZEFFIX 30.5 +11%(2) 266 Other 52.6 +11% n/a(1) The impact of foreign exchange movements has contributed +1% to thereported growth.(2) The impact of foreign exchange movements has contributed +2% to thereported growth.(3) GSK.(4) Compared with 2004.3TCRoyalties from sales of 3TC for the year to December 31, 2005 were $159.8million, an increase of 3% compared to 2004 ($155.8 million). This was due tothe continued growth in the nucleoside analog market for HIV and the positiveimpact of foreign exchange movements.Shire receives royalties from GSK on worldwide 3TC sales. GSK's worldwide salesof 3TC for the year to December 31, 2005 were $1,211 million, an increase of 2%compared to prior year (2004: $1,184 million).ZEFFIXRoyalties from sales of ZEFFIX for the year to December 31, 2005 were $30.5million, an increase of 11% compared to 2004 ($27.4 million), due to stronggrowth in the Japanese market and the positive impact of foreign exchangemovements.Shire receives royalties from GSK on worldwide ZEFFIX sales. GSK's worldwidesales of ZEFFIX for the year to December 31, 2005 were $266 million, anincrease of 11% compared to prior year (2004: $240 million).OTHEROther royalties are primarily in respect of REMINYL and REMINYL XL (nowmarketed as RAZADYNE and RAZADYNE ER in the US), a product marketed worldwideby Janssen Pharmaceutica N.V. (Janssen), an affiliate of Johnson and Johnson,with the exception of the United Kingdom and the Republic of Ireland whereShire acquired the exclusive marketing rights from May 2004.Sales of the REMINYL/RAZADYNE range, for the symptomatic treatment of mild tomoderately severe dementia of the Alzheimer's type, are growing well in theAlzheimer's market.On March 1, 2005, the National Institute for Health and Clinical Excellence(NICE) in England and Wales issued an Appraisal Consultation Document (ACD).This document included a recommendation that all existing approved products forthe symptomatic treatment of mild to moderate Alzheimer's disease in Englandand Wales should no longer be reimbursed by the National Health Service (NHS)when used in the treatment of new patients. The recommendation potentiallyaffected sales of REMINYL and of REMINYL XL in England and Wales. An amendedACD was issued by NICE on January 23, 2006. The new ACD recommends that REMINYLand REMINYL XL, together with other drugs in the same class, be reimbursed onthe NHS when used for the treatment of either (i) patients with existingAlzheimer's disease already being treated with one of these drugs; or (ii)newly diagnosed patients once their disease has progressed to a moderate stage.Therefore the current recommendation excludes the reimbursement of treatmentfor patients presenting with mild symptoms of Alzheimer's disease for whichREMINYL and REMINYL XL are approved. A final appraisal document is expectedfrom NICE in July 2006.On April 11, 2005, Ortho-McNeil Neurologics Inc. (Janssen's US affiliatecompany) announced that REMINYL would be marketed in the US under the newproduct name of RAZADYNE. Subsequently, in the US, REMINYL XL was launched asRAZADYNE ER. Ortho-McNeil Neurologics Inc. worked closely with the FDA on aname change following dispensing errors in the US, between REMINYL and the Type2 diabetes mellitus drug known as AMARYL. Shire is only aware of one similardispensing error outside the US.4. Financial detailsCost of product salesFor the year to December 31, 2005 the cost of product sales amounted to 16% ofproduct sales (2004: 13%). The decrease in gross margin is primarily due to theaddition of REPLAGAL to Shire's product portfolio following the acquisition ofTKT. REPLAGAL's cost of product sales relates entirely to the acquiredinventories, which in accordance with US GAAP, have been accounted for at fairvalue, estimated to be 97% of the expected sales price of REPLAGAL.Accordingly, little or no margin will be reflected for REPLAGAL sales until allacquired finished goods have been sold (anticipated Q3 2006). For the year toDecember 31, 2005 the cost of product sales for REPLAGAL includes a $41.9million adjustment in respect of the acquired inventory, of which $39.8 millionrelated to sales of acquired finished goods and $2.1 million was a write-off ofdamaged work-in-progress. In 2005, this fair value adjustment increased Shire'scost of product sales by 3%.Research and development (R&D)R&D expenditure increased from $196.3 million in the year to December 31, 2004to $336.2 million in 2005. Expressed as a percentage of total revenues, R&Dexpenditure was 21% for the year to December 31, 2005 (2004: 14%). The increasewas primarily due to: * The initial payment to New River of $50 million for in-licensing NRP104, which has been expensed in accordance with the Company's accounting policy; and * The addition of two significant R&D projects following the acquisition of TKT (ELAPRASE and GA-GCB). The New River payment and the R&D expenditure on ELAPRASE and GA-GCBrepresented 5% of total revenues.Shire's pipeline is now well advanced with seven projects in late stagedevelopment or registration.Selling, general and administrative (SG&A)SG&A expenses increased from $458.1 million in the year to December 31, 2004 to$631.1 million in 2005, an increase of 38%. As a percentage of product sales,these expenses were 48% (2004: 41%).This increase was expected, with additional costs attributable to four productlaunches during 2005, together with incremental costs in 2005 associated withthe new FOSRENOL and EQUETRO sales forces, patent litigation andinfrastructure, $24.5 million of SG&A costs related to the acquired TKTbusiness and $4.5 million related to the set up of the new listed holdingcompany for the Shire group.Depreciation and amortizationThe depreciation charge for the year to December 31, 2005 was $29.2 million(2004: $19.8 million), which in 2005 included property, plant and equipmentwrite-downs of $6.5 million (2004: $nil). Amortization charges, including theamortization on acquired products, were $45.2 million for the year to December31, 2005 (2004: $38.7 million).Intangible asset impairmentThe charge for intangible asset impairments for the year to December 31, 2005was $5.6 million (2004: $13.5 million).The approval of generic versions of AGRYLIN in April 2005 and the decision notto support and promote certain non-core products going forward resulted inchanges to the estimate of Shire's future cash flows and, as a result,impairments were required in both 2005 and 2004.Reorganization costsDuring the year to December 31, 2005 Shire incurred reorganization costs of$9.3 million (2004: $48.5 million). These costs related to Shire's NorthAmerican site consolidation, which commenced in 2004. The site consolidation isnow complete and no further reorganization costs are expected.During the year to December 31, 2005 the reorganization costs were for employeeseverance ($1.6 million), operating duplicate facilities ($7.2 million) andother costs ($0.5 million).During the year to December 31, 2004 the reorganization costs were for employeeseverance ($20.0 million), relocation ($13.8 million) and other costs ($14.7million).Integration costsFor the year to December 31, 2005, the Company incurred $9.7 million of costsassociated with the integration of the TKT business into the Shire group (2004:$nil). This included retention payments for key staff of $7.0 million, IT costsof $1.0 million and other costs of $1.7 million.In-process R&D write-offDuring the year to December 31, 2005, as required under US GAAP, Shire wroteoff the portion of the TKT purchase price allocated to in-process R&D of $673.0million. This amount represents the value of those intangible assets acquiredas part of the TKT acquisition, which at the time of acquisition had not beenapproved by the FDA or other regulatory authorities, including ELAPRASE andGA-GCB.Interest incomeFor the year to December 31, 2005 the Company received interest income of $35.3million (2004: $21.9 million). The increase compared to 2004 is due to higherinterest rates on Shire's US cash deposits, which were partially offset by theinterest foregone by Shire on the net payments of $1.1 billion made to date inrespect of the acquisition of TKT.Interest expenseFor the year to December 31, 2005 the Company incurred interest expense of$12.0 million (2004: $12.3 million).In 2005, this expense included a $7.7 million provision for interest, which maybe awarded by the court in respect of amounts due to those ex-TKT shareholderswho have requested appraisal of the acquisition consideration payable for theirTKT shares. In addition, interest expense includes $1.2 million, relating tothe costs of a bridging loan to finance the TKT acquisition and other interestrelated expenses of $3.1 million.In 2004, interest expense included the write-off of $8.0 million of deferreddebt acquisition costs arising on the issue of convertible loan notes in August2001. The write-off was required as a significant portion of the convertibleloan notes were redeemed. The $8.0 million represented the balance of thesefees at the date of redemption in August 2004. In addition, interest expenseincluded a $4.2 million interest charge incurred prior to the redemption and$0.1 million of other interest related expenses.Other income/(expense), netFor the year to December 31, 2005 other income totaled $9.9 million (2004: $3.8million).Other income for 2005 included a $3.9 million realized gain on the sale of aportfolio investment, $4.3 million in respect of other investment income, a$3.6 million gain on the sale of Shire's drug formulation business and othernet income of $ 0.1 million, offset by a write-down of certain portfolioinvestments ($2.0 million).Other income for 2004 consisted of a $14.8 million realized gain on the sale ofa portfolio investment, $4.1 million of other investment income and other netincome of $0.4 million. This income was offset by the write-down of certainportfolio investments ($15.5 million).TaxationThe effective tax rate for 2005 on US GAAP losses was negative 29% (a taxcharge of $92.1 million on US GAAP losses from continuing operations beforeincome taxes and equity method investees of $320.9 million). The significantdifference from the prior year effective tax rate of 28% is due to thein-process R&D write-off of $673 million which is not tax deductible. Excludingthe impact of this in-process R&D charge, the effective tax rate for 2005 was26%.At December 31, 2005 net deferred tax assets of $116.2 million were recognized(December 31, 2004: $78.1 million).Equity in (losses)/earnings of equity method investeesNet losses of $1.0 million were recorded for the year to December 31, 2005:(2004: net earnings of $2.5 million). This comprised earnings of $5.3 millionfrom the 50% share of the antiviral commercialization partnership with GSK inCanada (2004: $4.4 million), offset by the Company's share of losses in theGeneChem and EGS Healthcare Funds of $6.3 million (2004: $1.9 million).Discontinued operationsDuring the year to December 31, 2005 gains on disposition of the discontinuedoperations totaled $3.1 million. This resulted from the finalization of theworking capital agreement with IDB, which was part of the sale of Shire'svaccines business to IDB in 2004. As a result, a disputed amount, which hadpreviously been provided for, was received and the corresponding provision wasreleased.Financial InformationTable of Contents Page Unaudited US GAAP Consolidated Balance Sheets 16 Unaudited US GAAP Consolidated Statements of Operations 18 Unaudited US GAAP Consolidated Statements of Cash Flows 20 Selected Notes to the Unaudited US GAAP Financial Statements (1) Earnings per share 23 (2) Analysis of revenues 25 Non GAAP reconciliation of numerator for diluted EPS 27 Non GAAP reconciliation of reported EPS 28 US GAAP and Non GAAP Unaudited Consolidated Statements of Operations 29 Unaudited IFRS Consolidated Balance Sheets 31 Unaudited IFRS Consolidated Income Statements 33 Unaudited IFRS Consolidated Cash Flow Statements 34 Selected Notes to the Unaudited IFRS Financial Statements (1) Earnings per share 35 (2) Condensed statement of changes in shareholders' equity 36 (3) Basis of preparation 36Unaudited US GAAP results for the year to December 31, 2005Consolidated Balance Sheets December 31, December 31, 2005 2004 $'000 $'000 __________ __________ ASSETS Current assets: Cash and cash equivalents 656,456 1,111,477 Restricted cash 30,568 21,627 Short-term investments 6,947 324,411 Accounts receivable, net 329,924 222,546 Inventories 136,057 41,230 Deferred tax asset 54,186 70,387 Prepaid expenses and other current assets 98,084 137,271 __________ __________ Total current assets 1,312,222 1,928,949 Investments 50,162 63,267 Property, plant and equipment, net 233,999 131,351 Goodwill 367,652 235,396 Other intangible assets, net 729,304 309,297 Deferred tax asset 61,994 7,724 Other non-current assets 42,907 38,895 __________ __________ Total assets 2,798,240 2,714,879 __________ _________ LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Loan facility to IDB - 43,162 Accounts payable and accrued expenses 431,819 311,231 Liability to dissenting shareholders 427,609 - Other current liabilities 105,993 77,558 __________ _________ Total current liabilities 965,421 431,951 Long-term debt, excluding current 116 116installments Other non-current liabilities 43,437 32,159 __________ _________ Total liabilities 1,008,974 464,226 __________ _________Unaudited US GAAP results for the year to December 31, 2005Consolidated Balance Sheets (continued) December 31, December 31, 2005 2004 $'000 $'000 ________ ________ Shareholders' equity: Common stock of 5p par value; 600,000,000 42,728 41,796shares authorized; and 495,733,782 shares issued and outstanding (2004: 800,000,000 shares authorized; and 484,916,034 shares issued and outstanding) Exchangeable shares: 2,187,793 shares issued 101,248 195,830and outstanding (2004: 4,226,476) Treasury stock (2,813) (264) Additional paid-in capital 1,205,257 1,070,675 Accumulated other comprehensive income 71,472 131,939 Retained earnings 371,374 810,677 _________ _________ Total shareholders' equity 1,789,266 2,250,653 _________ _________ Total liabilities and shareholders' equity 2,798,240 2,714,879 _________ _________Unaudited US GAAP results for the 3 months and year to December 31, 2005Consolidated Statements of Operations 3 months to 3 months to 12 months to 12 months December 31, December 31, December 31, to December 2005 2004 2005 31, 2004 $'000 $'000 $'000 $'000 ___________ ___________ ___________ ___________ Revenues: Product sales 397,511 308,860 1,327,660 1,112,457 Royalties 61,837 60,363 242,910 230,364 Licensing and development 3,833 3,262 15,002 13,479 Other revenues 1,769 1,253 13,744 6,907 _________ _________ __________ ________ Total revenues 464,950 373,738 1,599,316 1,363,207 _________ _________ _________ ________ Costs and expenses: Cost of product sales 78,605 41,899 213,964 141,909 Research and development 84,917 52,505 336,217 196,265 Selling, general and 165,164 127,902 631,124 458,132administrative Depreciation and 24,300 18,039 74,435 58,513amortization Intangible asset 2,632 8,021 5,632 13,477impairment Reorganization costs - 16,428 9,335 48,469 Integration costs 6,196 - 9,716 - In-process R&D write-off - - 673,000 - ________ ________ _________ ________ Total operating expenses 361,814 264,794 1,953,423 916,765 ________ ________ _________ ________ Operating income/(loss) 103,136 108,944 (354,107) 446,442 Interest income 7,432 7,800 35,300 21,901 Interest expense (7,305) (35) (12,023) (12,294) Other income/(expense), 6,007 (558) 9,945 3,845net ________ ________ ________ ________ Total other income, net 6,134 7,207 33,222 13,452 ________ ________ ________ ________ Income/(loss) from 109,270 116,151 (320,885) 459,894continuing operations before income taxes and equity in (losses)/ earnings of equity method investees Income taxes (30,376) (31,915) (92,083) (129,103) Equity in (losses)/ (1,150) (850) (1,000) 2,508earnings of equity method investees ________ ________ ________ ________ Income/(loss) from 77,744 83,386 (413,968) 333,299continuing operations Loss from discontinued - - - (20,135)operations (Loss)/gain on disposition (1,049) - 3,125 (44,157)of discontinued operations ________ ________ ________ _________ Net income/(loss) 76,695 83,386 (410,843) 269,007 ________ ________ ________ _________Unaudited US GAAP results for the 3 months and year to December 31, 2005Consolidated Statements of Operations (continued) 3 months to 3 months to 12 months to 12 months to December 31, December 31, December 31, December 31, 2005 2004 2005 2004 ___________ ___________ ___________ ___________ Earnings per share - basic Income/(loss) from 15.5c 16.8c (82.7c) 67.2ccontinuing operations Loss from discontinued - - - (4.1c)operations (Loss)/gain on disposition (0.2c) - 0.6c (8.9c)of discontinued operations ___________ ___________ ___________ ___________ Earning per ordinary share 15.3c 16.8c (82.1c) 54.2c- basic ___________ ___________ ___________ __________ Earnings per share - diluted Income/(loss) from 15.3c 16.7c (82.7c) 65.9ccontinuing operations Loss from discontinued - - - (4.0c)operations (Loss)/gain on disposition (0.2c) - 0.6c (8.6c)of discontinued operations ___________ ___________ ___________ __________ Earning per ordinary share 15.1c 16.7c (82.1c) 53.3c- diluted ___________ ___________ ___________ __________ Earnings per ADS - diluted 45.2c 49.8c (246.4c) 159.9c ___________ ___________ ___________ __________ Weighted average number of shares: Basic 501,675,141 497,063,870 500,243,137 496,306,604 Diluted 508,702,513 500,227,937 500,243,137 511,267,432 ___________ ___________ ___________ __________Unaudited US GAAP results for the 3 months and year to December 31, 2005Consolidated Statements of Cash Flows 3 months to 3 months to 12 months to 12 months to December 31, December 31, December 31, December 31, 2005 2004 2005 2004 $'000 $'000 $'000 $'000 _____________ ____________ _____________ ____________ CASH FLOWS FROM OPERATING ACTIVITIES: Net income/(loss) from 77,744 83,386 (413,968) 333,299continuing operations Adjustments to reconcile net income/(loss) to net cash provided by operating activities: Depreciation and 801 775 3,483 2,740amortization: 23,892 18,039 67,977 58,513- cost of product sales - SG&A Stock option compensation 205 51 392 216 In-process R&D write-off - - 673,000 - Write-down of long-term 3,059 9,925 14,064 29,317assets Loss/(gain) on sale of 12 (796) (3,854) (15,268)long-term assets Gain on sale of drug (3,561) - (3,561) -formulation business Movement in deferred taxes (12,012) 8,631 22,295 (14,979) Equity in losses/(earnings) 1,150 850 1,000 (2,508)of equity method investees Changes in operating assets and liabilities, net of acquisitions: (Increase)/decrease in (45,992) 21,195 (79,885) (28,066)accounts receivable Increase in sales deduction 4,192 11,195 18,616 50,746accrual Decrease in inventory 9,855 5,049 8,582 2,185 (Increase)/decrease in (15,708) 310 (40,111) 2,509prepayments and other current assets Decrease/(increase) in 48 11,497 (731) 13,520other assets Increase in accounts and 114,814 29,471 122,949 76,793notes payable and other liabilities (Decrease)/increase in (2,989) 6,439 (13,520) 6,151deferred revenue Returns on investments - - 4,710 4,043 Cash flows used in (1,049) (4,912) (362) (30,525)discontinued operations ___________ ___________ ___________ ___________ Net cash provided by 154,461 201,105 381,076 488,686operating activities(A) Unaudited US GAAP results for the 3 months and year to December 31, 2005Consolidated Statements of Cash Flows (continued) 3 months to 3 months to 12 months to 12 months to December 31, December 31, December 31, December 31, 2005 2004 2005 2004 $'000 $'000 $'000 $'000 __________ __________ __________ __________ CASH FLOWS FROM INVESTING ACTIVITIES: Movements in short-term 15,485 (41,321) 366,731 (20,282)investments Movements in restricted (483) 9,274 (768) 24,847cash Purchase of subsidiary (14,398) - (1,114,048) -undertaking, net of cash and cash equivalents Expenses of acquisition (13,379) - (37,491) - Purchase of long-term (22) (404) (7,700) (6,124)investments Purchase of property, plant (28,601) (32,763) (86,239) (57,603)and equipment Purchase of intangible (427) (17,824) (20,491) (30,209)assets Proceeds from sale of - - 10,135 26,733long-term investments Proceeds from sale of 8 3,083 116 3,527property, plant and equipment Proceeds from sale of - 3,701 - 3,701intangible assets Proceeds from sale of - - - 11,289assets held for sale Proceeds from sale of drug 557 - 557 -formulation business Returns of investments - 248 3,774 1,450 Loans made to IDB - (33,018) (43,162) (56,838) Proceeds from sale of the - 4,912 92,236 34,912vaccines business Cash flows used in - - - (12,715)discontinued operations ___________ ___________ ___________ ___________ Net cash used in investing (41,260) (104,112) (836,350) (77,312)activities(B) Unaudited US GAAP results for the 3 months and year to December 31, 2005Consolidated Statements of Cash Flows (continued) 3 months to 3 months to 12 months to 12 months to December 31, December 31, December 31, December 31, 2005 2004 2005 2004 $'000 $'000 $'000 $'000 __________ __________ __________ __________ CASH FLOWS FROM FINANCING ACTIVITIES: Redemption of 2% - - - (370,109)convertible loan notes Repayment of long-term - (5,908) - (6,079)debt, capital leases and notes Proceeds from exercise of 6,666 5,885 37,113 13,416options Proceeds from issue of - 160 - 771common stock, net Tax benefit of stock 949 354 3,427 354option compensation, charged directly to reserves Payments to acquire (2,480) (264) (2,480) (264)treasury stock Payment of dividend (9,403) (8,905) (28,460) (8,905) ___________ ___________ ___________ ___________ Net cash (used in)/ (4,268) (8,678) 9,600 (370,816)provided by financing activities(C) Effect of foreign exchange (2,297) 5,272 (9,347) 7,567rate changes on cash and cash equivalents Effect of foreign exchange - - - (10)rate changes on discontinued operations ___________ ___________ ___________ ___________ Net effect of foreign (2,297) 5,272 (9,347) 7,557exchange rate changes(D) Net increase/(decrease) in 106,636 93,587 (455,021) 48,115cash and cash equivalents (A) +(B) +(C) +(D) Cash and cash equivalents 549,820 1,017,890 1,111,477 1,063,362at beginning of period ___________ _____________ _____________ _____________ Cash and cash equivalents 656,456 1,111,477 656,456 1,111,477at end of period US GAAP results for the 3 months and year to December 31, 2005Selected Notes to the Unaudited US GAAP Financial Statements(1) Earnings per share 3 months to 3 months to 12 months to 12 months to December 31, December 31, December 31, December 31, 2005 2004 2005 2004 $'000 $'000 $'000 $'000 __________ __________ __________ __________ Income/(loss) from 77,744 83,386 (413,968) 333,299continuing operations Loss from discontinued - - - (20,135)operations, net of tax (Loss)/gain on disposition (1,049) - 3,125 (44,157)of discontinued operations __________ __________ __________ __________ Numerator for basic EPS 76,695 83,386 (410,843) 269,007 Interest on convertible - (3) - 3,421debt, net of tax __________ __________ __________ __________ Numerator for diluted EPS 76,695 83,383 (410,843) 272,428 __________ __________ __________ __________ Weighted average number of No. of No. of No. of No. ofshares: shares shares shares shares __________ __________ __________ __________ Basic 501,675,141 497,063,870 500,243,137 496,306,604 Effect of dilutive shares: Stock options 6,615,836 3,059,348 - 3,035,620 Warrants 405,780 98,963 - 66,792 Convertible debt 5,756 5,756 - 11,858,416 __________ __________ __________ __________ Diluted 508,702,513 500,227,937 500,243,137 511,267,432 __________ __________ __________ __________US GAAP results for the 3 months and year to December 31, 2005Selected Notes to the Unaudited US GAAP Financial Statements (continued)The share options, warrants and convertible debt not included in thecalculation of the diluted weighted average number of shares are shown below: (1) 3 months (1) 3 months (2) 12 months (1) 12 months to December to December to December 31, to December 31, 2005 31, 2004 2005 31, 2004 No. of shares No. of No. of shares No. of shares shares __________ __________ __________ __________ Stock options 10,085,752 9,163,492 20,680,407 16,640,724 Warrants - - 1,346,407 - Convertible debt - - 5,756 - __________ __________ __________ __________ 10,085,752 9,163,492 22,032,570 16,640,724 __________ __________ __________ __________ 1. Not included as the exercise price exceeded the Company's average share price during the calculation period. 2. Not included as the Company made a loss during the calculation period. Unaudited US GAAP results for the 3 months to December 31, 2005Selected Notes to the US GAAP Financial Statements (continued)(2) Analysis of revenues 3 months to 3 months to 3 months to 3 months to December 31, December 31, December 31, December 31, 2005 2005 2004 2005 % of total $'000 $'000 % change revenue Net product sales: CNS ADDERALL XR 214,010 183,660 +17% 46% ADDERALL 12,078 12,074 0% 2% CARBATROL 17,275 15,468 +12% 4% __________ __________ __________ __________ 243,363 211,202 +15% 52% __________ __________ __________ __________ GI PENTASA 42,306 28,290 +50% 9% COLAZIDE 2,099 2,268 -7% 1% __________ __________ __________ __________ 44,405 30,558 +45% 10% __________ __________ __________ __________ GP AGRYLIN/XAGRID NORTH AMERICA 4,031 22,259 -82% 1% ROW 10,381 8,276 +25% 2% FOSRENOL 29,032 - N/A 6% CALCICHEW 10,359 10,727 -3% 2% REMINYL/REMINYL XL 4,136 2,865 +44% 1% SOLARAZE 3,754 3,244 +16% 1% LODINE 3,114 2,663 +17% 1% __________ __________ __________ __________ 64,807 50,034 +30% 14% __________ __________ __________ __________ HGT REPLAGAL 25,358 - N/A 5% __________ __________ __________ __________ 25,358 - N/A 5% __________ __________ __________ __________ Other product sales 19,578 17,066 +15% 4% __________ __________ __________ __________ Total product sales 397,511 308,860 +29% 85% __________ __________ __________ __________ Royalty income: 3TC 40,372 40,118 +1% 8% ZEFFIX 8,499 7,219 +18% 2% Others 12,966 13,026 0% 3% __________ __________ __________ __________ 61,837 60,363 +2% 13% __________ __________ __________ __________ Licensing and development 3,833 3,262 +18% 1% Other 1,769 1,253 +41% 1% _________ ___________ __________ __________ Total revenues 464,950 373,738 +24% 100% _________ ___________ __________ __________Unaudited US GAAP results for the year to December 31, 2005Selected Notes to the US GAAP Financial Statements (continued)(2) Analysis of revenues (continued) 12 months to 12 months to 12 months to 12 months to December 31, December 31, December 31, December 31, 2005 2004 2005 2005 $'000 $'000 % change % of total revenue ___________ ____________ ___________ ___________ Net product sales: CNS ADDERALL XR 730,833 606,657 +20% 46% ADDERALL 43,111 34,485 +25% 3% CARBATROL 72,098 54,341 +33% 4% ___________ ___________ ___________ ___________ 846,042 695,483 +22% 53% ___________ ___________ ___________ ___________ GI PENTASA 136,083 114,995 +18% 8% COLAZIDE 8,619 8,212 +5% 1% ___________ ___________ ___________ ___________ 144,702 123,207 +17% 9% ___________ ___________ ___________ ___________ GP AGRYLIN/XAGRID N AMERICA 45,981 119,099 -61% 3% ROW 46,809 33,431 +40% 3% FOSRENOL 53,516 - N/A 3% CALCICHEW 38,712 38,252 +1% 2% REMINYL/REMINYL XL 13,520 10,848 +25% 1% SOLARAZE 12,530 9,458 +32% 1% LODINE 12,589 7,582 +66% 1% ___________ ___________ ___________ ___________ 223,657 218,670 +2% 14% ___________ ___________ ___________ ___________ HGT REPLAGAL 41,314 - N/A 3% ___________ ___________ ___________ ___________ 41,314 - N/A 3% ___________ ___________ ___________ ___________ Other product sales 71,945 75,097 -4% 4% ___________ ___________ ___________ ___________ Total product sales 1,327,660 1,112,457 +19% 83% ___________ ___________ ___________ ___________ Royalty income: 3TC 159,839 155,791 +3% 10% ZEFFIX 30,468 27,393 +11% 2% Others 52,603 47,180 +11% 3% ___________ ___________ ___________ ___________ 242,910 230,364 +5% 15% ___________ ___________ ___________ ___________ Licensing and 15,002 13,479 +11% 1%development Other 13,744 6,907 +99% 1% ___________ ____________ ___________ ___________ Total revenues 1,599,316 1,363,207 +17% 100% ____________ _____________ ____________ ____________Non GAAP reconciliation of numerator for diluted EPS for the 3 months and yearto December 31, 2005 3 months to 3 months to 12 months to 12 months to December 31, December 31, December 31, December 31, 2005 2004 2005 2004 $'000 $'000 $'000 $'000 __________ __________ __________ __________ Net income/(loss) for 76,695 83,386 (410,843) 269,007basic EPS Add back: Loss/(gain) from 1,049 - (3,125) 20,135discontinued operations Loss on disposition of - - - 44,157discontinued operations TKT in-process R&D - - 673,000 -write-off TKT cost of product sales 24,683 - 41,885 -fair value adjustment New River upfront payment - - 50,000 - New listed holding company - - 4,527 -costs Reorganization costs - 16,428 9,335 48,469 TKT integration costs 6,196 - 9,716 - Gain on disposal of drug (3,561) - (3,561) -formulation business Gain on sale of investment - - - (14,805) Taxes on above adjustments (7,649) (4,600) (31,333) (9,426) _________ _________ _________ _________ Total non GAAP adjustment 20,718 11,828 750,444 88,530 _________ _________ _________ _________ Net income for non GAAP 97,413 95,214 339,601 357,537 Interest on convertible - (3) 1 3,421debt _________ _________ _________ _________ Numerator for non GAAP - 97,413 95,211 339,602 360,958Diluted EPS _________ _________ _________ __________(1) An analysis of the results for the three months and year to December 31,2005 between Shire (excluding TKT) and TKT is shown on pages 29 and 30.Non GAAP reconciliation of reported EPS for the 3 months and 12 months toDecember 31, 2005 3 months to 3 months to 12 months to 12 months to December 31, December 31, December 31, December 31, 2005 2004 2005 2004 __________ __________ __________ __________ Diluted EPS per ordinary 15.1c 16.7c (82.1c) 53.3cshare Add back: Loss/(gain) from 0.2c - (0.6c) 4.0cdiscontinued operations, net of tax Loss on disposition of - - - 8.6cdiscontinued operations __________ __________ __________ __________ Diluted EPS from 15.3c 16.7c (82.7c) 65.9ccontinuing operations Change in denominator due - - 0.9c -to effect on dilution of non GAAP adjustments(1) __________ __________ __________ __________ 15.3c 16.7c (81.8c) 65.9c Add back: TKT in-process R&D - - 133.0c -write-off TKT cost of product sales 4.9c - 8.3c -fair value adjustment New River upfront payment - - 9.9c - New listed holding company - - 0.9c -costs Reorganization costs - 3.3c 1.8c 9.5c TKT integration costs 1.2c - 1.9c - Gain on disposal of drug (0.7c) - (0.7c) -formulation business Gain on sale of investment - - - (2.9c) Taxes on above adjustments (1.6c) (1.0c) (6.2c) (1.9c) __________ __________ __________ __________ Non GAAP - diluted EPS per 19.1c 19.0c 67.1c 70.6cordinary share __________ __________ __________ __________ Non GAAP - diluted EPS per 57.4c 57.0c 201.4c 211.8cADS __________ __________ __________ __________ Total non GAAP adjustments 4.0c 2.3c 149.2c 17.3c- diluted EPS per ordinary share __________ __________ __________ __________ 1. Since the items added back result in positive non GAAP net income for the year to December 31, 2005, the options, warrants and convertible debt become dilutive under this measure and are therefore included in the calculation of the denominator for non GAAP EPS. US GAAP and Non GAAP results for the 3 months to December 31, 2005Unaudited Consolidated Statements of Operations Non GAAP (1) Shire (2) TKT Combined Adjustments US GAAP $'000 $'000 $'000 $'000 $'000 __________ __________ __________ __________ __________ Revenues: Product sales 372,153 25,358 397,511 - 397,511 Royalties 61,837 - 61,837 - 61,837 Licensing and 3,833 - 3,833 - 3,833development Other revenues 1,305 464 1,769 - 1,769 __________ __________ __________ __________ __________ Total revenues 439,128 25,822 464,950 - 464,950 __________ __________ __________ __________ __________ Costs and expenses: Cost of product sales 51,844 2,078 53,922 24,683 78,605(3) Research and 61,095 23,822 84,917 - 84,917development Selling, general and 147,618 17,546 165,164 - 165,164administrative Depreciation and 17,053 9,879 26,932 - 26,932amortization Reorganization costs - - - - - Integration costs - - - 6,196 6,196 In-process R&D - - - - -write-off __________ __________ __________ __________ __________ Total operating 277,610 53,325 330,935 30,879 361,814expenses __________ __________ __________ __________ __________ Operating income/ 161,518 (27,503) 134,015 (30,879) 103,136(loss) Interest income 6,907 525 7,432 - 7,432 Interest expense (2,050) (5,255) (7,305) - (7,305) Other income, net (4) 1,896 550 2,446 3,561 6,007 __________ __________ __________ __________ __________ Total other income/ 6,753 (4,180) 2,573 3,561 6,134(expense), net __________ __________ __________ __________ __________ Income/(loss) from 168,271 (31,683) 136,588 (27,318) 109,270continuing operations before income taxes and equity in losses of equity method investees Income taxes (46,790) 8,765 (38,025) 7,649 (30,376) Equity in losses of (1,150) - (1,150) - (1,150)equity method investees __________ __________ __________ __________ __________ Income/(loss) from 120,331 (22,918) 97,413 (19,669) 77,744continuing operations Gain on disposition of - - - (1,049) (1,049)discontinued operations __________ __________ __________ __________ __________ Net income/(loss) 120,331 (22,918) 97,413 (20,718) 76,695 __________ __________ __________ __________ __________ Diluted EPS 23.6c (4.5c) 19.1c (4.0c) 15.1c Ordinary share 70.9c (13.5c) 57.4c (12.2c) 45.2c ADS __________ __________ __________ __________ __________(1) Defined as the ongoing Shire business excluding TKT and other non GAAPadjustments.(2) Defined as the acquired TKT business excluding fair value adjustments andintegration costs.(3) The GAAP adjustment of $24.7m is the difference between fair value and costof REPLAGAL inventory acquired with the TKT business and used during theperiod.(4) The GAAP adjustment of $3.6 million is the gain on sale of the drugformulation business.US GAAP and Non GAAP results for the year to December 31, 2005Unaudited Consolidated Statements of Operations Non GAAP (1) Shire (2) TKT Combined Adjustments US GAAP $'000 $'000 $'000 $'000 $'000 __________ __________ __________ __________ __________ Revenues: Product sales 1,286,346 41,314 1,327,660 - 1,327,660 Royalties 242,910 - 242,910 - 242,910 Licensing and 15,002 - 15,002 - 15,002development Other revenues 13,066 678 13,744 - 13,744 __________ __________ __________ __________ __________ Total revenues 1,557,324 41,992 1,599,316 - 1,599,316 __________ __________ __________ __________ __________ Costs and expenses: Cost of product sales 167,818 4,261 172,079 41,885 213,964(3) Research and 248,197 38,020 286,217 50,000 336,217development Selling, general and 602,088 24,509 626,597 4,527 631,124administrative (4) Depreciation and 63,678 16,389 80,067 - 80,067amortization Reorganization costs - - - 9,335 9,335 Integration costs - - - 9,716 9,716 In-process R&D - - - 673,000 673,000write-off __________ __________ __________ __________ __________ Total operating 1,081,781 83,179 1,164,960 788,463 1,953,423expenses __________ __________ __________ __________ __________ Operating income/ 475,543 (41,187) 434,356 (788,463) (354,107)(loss) Interest income 34,346 954 35,300 - 35,300 Interest expense (4,331) (7,692) (12,023) - (12,023) Other income, net (5) 5,695 689 6,384 3,561 9,945 __________ __________ __________ __________ __________ Total other income/ 35,710 (6,049) 29,661 3,561 33,222(expense), net __________ __________ __________ __________ __________ Income/(loss) from 511,253 (47,236) 464,017 (784,902) (320,885)continuing operations before income taxes and equity in losses of equity method investees Income taxes (136,463) 13,047 (123,416) 31,333 (92,083) Equity in losses of (1,000) - (1,000) - (1,000)equity method investees __________ __________ __________ __________ __________ Income/(loss) from 373,790 (34,189) 339,601 (753,569) (413,968)continuing operations Gain on disposition of - - - 3,125 3,125discontinued operations __________ __________ __________ __________ __________ Net income/(loss) 373,790 (34,189) 339,601 (750,444) (410,843) __________ __________ __________ __________ __________ Diluted EPS 73.9c (6.8c) 67.1c (149.2c) (82.1c) Ordinary share 221.7c (20.3c) 201.4c (447.8c) (246.4c) ADS __________ __________ __________ __________ __________(1) Defined as the ongoing Shire business excluding TKT and other non GAAPadjustments.(2) Defined as the acquired TKT business excluding fair value adjustments andintegration costs.(3) The GAAP adjustment of $41.9m is the difference between fair value and costof REPLAGAL inventory acquired with the TKT business and used or written offduring the period.(4) The GAAP adjustment of $4.5 million relates to the costs of setting up thenew holding company.(5) The GAAP adjustment of $3.6 million is the gain on sale of the drugformulation business.Unaudited IFRS results for the year to December 31, 2005Consolidated Balance Sheet December 31, December 31, 2005 2004 $'000 $'000 _____________ ____________ ASSETS Non-current assets: Goodwill 2,209,460 2,246,220 Other intangible assets 1,394,677 322,258 Property, plant and equipment 218,199 128,202 Deferred tax assets 67,283 85,041 Investments accounted for using equity method 23,023 30,848 Available for sale investments 27,139 76,550 Other receivables 42,907 38,895 _____________ _____________ 3,982,688 2,928,014 _____________ _____________ Current assets: Inventories 136,057 41,230 Trade and other receivables 415,189 299,817 Trading investments 6,947 324,845 Cash and cash equivalents 656,456 1,111,477 Restricted cash 30,568 21,627 _____________ _____________ 1,245,217 1,798,996 _____________ _____________ Total assets 5,227,905 4,727,010 _____________ _____________ LIABILITIES AND SHAREHOLDERS' EQUITY Non-current liabilities: Borrowings 4,704 4,242 Trade and other payables 18,036 12,963 Deferred tax liabilities 127,691 - Long-term provisions 25,401 26,232 _______ _______ 175,832 43,437 ___________ ____________ Current liabilities: Borrowings 2,667 2,420 Trade and other payables 518,051 344,367 Liability to dissenting shareholders 427,609 - Current tax liabilities 12,090 46,757 Provisions 8,523 45,097 _____________ ____________ 968,940 438,641 _____________ ___________ Total liabilities 1,144,772 482,078 _____________ ___________ Unaudited IFRS results for the year to December 31, 2005Consolidated Balance Sheet (continued) December 31, December 31, 2005 2004 $'000 $'000 _____________ ____________ Shareholders' equity: Share capital 42,728 36,083 Share premium 2,977 4,883,219 Treasury shares (2,813) (264) Exchangeable shares: 2,187,793 shares issued 101,248 195,830and outstanding (2004: 4,226,476) Capital reduction reserve 2,946,490 - Capital reserve - 4,729 Other reserve 2,099,652 36,121 Retained earnings (1,107,149) (910,786) ___________ ___________ Total shareholders' equity 4,083,133 4,244,932 ___________ ___________ Total liabilities and shareholders' equity 5,227,905 4,727,010 ___________ ___________Unaudited IFRS results for the year to December 31, 2005Consolidated Income StatementYear to December 31, 2005 2004 $'000 $'000 _____________ _____________ Continuing operations: Revenue 1,599,316 1,363,207 Cost of sales (215,336) (142,557) _____________ _____________ Gross profit 1,383,980 1,220,650 Research and development (287,146) (210,974) Selling, general and administrative (including (1,255,707) (718,890)$526,956,000 goodwill impairment (2004: $132,576,000)) _____________ _____________ Operating (loss)/profit (158,873) 290,786 Investment revenues 35,300 21,901 Finance costs (17,420) (14,771) Share of post tax profit from associates and (1,000) 4,508joint ventures _____________ _____________ (Loss)/profit before tax (141,993) 302,424 Taxation (38,510) (141,623) _____________ _____________ (Loss)/profit for the year from continuing (180,503) 160,801operations Discontinued operations: Profit/(loss) for the year from discontinued 3,125 (64,292)operations ____________ ____________ (Loss)/profit for the year (177,378) 96,509 ____________ ____________ Earnings per share (expressed in cents per share) - Basic (35.5c) 19.4c - Diluted (35.5c) 19.3c ____________ ____________ Earnings per share from continuing operations (expressed in cents per share) - Basic (36.1c) 34.2c - Diluted (36.1c) 34.2c __________ __________Unaudited IFRS results for the year to December 31, 2005Consolidated Cash Flow StatementYear to December 31, 2005 2004 $'000 $'000 _____________ ____________ Net cash flows from operating activities 401,187 465,762 Cash flow from investing activities Movement in restricted cash (768) 24,847 Purchase of subsidiary undertaking, net of cash (1,114,048) -and cash equivalents Expense of acquisition (37,491) - Loan made to IDB (43,162) (56,838) Purchase of property, plant and equipment (71,946) (49,746) Purchase of intangible assets (92,139) (42,293) Purchases of financial assets (7,700) (6,124) Net decrease/(increase) in current financial 366,731 (20,282)assets Proceeds from sale of property, plant and 1,169 4,360equipment (PP&E) Proceeds from sale of intangible assets - 3,701 Proceeds from sale of financial assets 10,135 26,733 Proceeds from PP&E held for sale - 11,289 Proceeds from sale of drug formulation business 557 - Proceeds from sale of discontinued business 92,236 34,912 Interest received 34,203 21,901 Dividend received from associates 3,774 1,450 Dividend from joint venture 4,710 4,043 Investing activities of discontinued business - (12,715) ___________ ___________ Net cash used in investing activities (853,739) (54,762) ___________ ___________ Cash flow from financing activities Proceeds from issuance of ordinary shares, net - 771 Proceeds from exercise of share options 37,113 13,416 Purchase of treasury shares (2,480) (264) Redemption of 2% guaranteed convertible loan - (370,109)notes 2011 Increase in/(repayment of) finance lease 708 (5,351)obligations Dividends paid (28,460) (8,905) ___________ ________ Net cash from/(used in) financing activities 6,881 (370,442) ___________ ____________ Net (decrease)/increase in cash and cash (445,671) 40,558equivalents Cash and cash equivalents at beginning of year 1,111,477 1,063,362 Effect of foreign currency translation (9,350) 7,557 ___________ _____________ Cash and cash equivalents at end of year 656,456 1,111,477 ___________ _____________Unaudited IFRS results for the year to December 31, 2005Selected Notes to the IFRS Financial Statements(1) Earnings per shareYear to December 31, 2005 Earnings Weighted average Per-share amount no of shares $'000 _________________ _________________ _________________ Basic EPS Loss attributable to ordinary (177,378) 500,243,137 (35.5c)shareholders Effect of dilutive securities Share options - - - Warrants - - - Convertible debt - - - _________________ _________________ _________________ Diluted EPS (177,378) 500,243,137 (35.5c) _________________ _________________ _________________ Earnings per share from Earnings Weighted average Per-share amountcontinuing and discontinued no of shares operations: $'000 _________________ _________________ _________________ Basic and diluted EPS Loss from continuing operations (180,503) 500,243,137 (36.1c) Gain from discontinued operations 3,125 - 0.6c _________________ _________________ _________________Year to December 31, 2004 Earnings Weighted average no Per-share amount of shares $'000 _________________ _________________ _________________ Basic EPS Earnings attributable to 96,509 496,306,604 19.4cordinary shareholders Effect of dilutive securities Share options - 3,035,620 (0.1c) Warrants - 66,792 - ___________ ___________________ ___________ Diluted EPS 96,509 499,409,016 19.3c ___________ __________________ ___________ Earnings per share from Earnings Weighted average Per-share amountcontinuing and discontinued no of shares operations: $'000 _________________ _________________ _________________ Basic EPS Profit from continuing 160,801 496,306,604 32.4coperations Loss from discontinued (64,292) - (13.0c)operations Diluted EPS Profit from continuing 160,801 499,409,016 32.2coperations Loss from discontinued (64,292) - (12.9c)operations ___________ __________________ ___________Unaudited IFRS results for the year to December 31, 2005Selected Notes to the IFRS Financial Statements (continued)(2) Condensed statement of changes in shareholders' equity 2005 2004 $'000 $'000 _________________ _________________ Shareholders' equity at January 1, 4,244,932 4,093,875 Foreign currency translation differences (28,855) 34,066 Employee share option scheme: - value of employee services 27,383 15,464 - proceeds from shares issued 37,113 13,416 Issue of share capital - 771 Purchase of treasury shares (2,549) (264) Dividends (28,460) (8,905) Tax benefit associated with the exercise of 1,721 -stock options Unrealized holding gain on available for 9,226 -sale investments (Loss)/profit for the year (177,378) 96,509 ______________ _____________ Balance at December 31, 4,083,133 4,244,932 ______________ _____________(3) Basis of preparationThe financial information set out in the announcement does not constitute theCompany's statutory accounts for the years ended December 31, 2005 or 2004. Thefinancial information presented above under IFRS for the comparative period hasbeen derived from the statutory accounts for the year ended December 31, 2004.It has been restated from that which was contained in those statutory financialstatements, which were prepared under UK GAAP and have been delivered to theRegistrar of Companies. The auditors reported on those accounts; their reportwas unqualified and did not contain a statement under s. 237(2) or (3)Companies Act 1985. The statutory accounts for the year ended December 31, 2005will be finalized on the basis of the financial information presented by thedirectors in this preliminary announcement and will be delivered to theRegistrar of Companies following the Company's annual general meeting. Thispreliminary announcement was approved by the Board on February 22, 2006. - 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:
Shire