Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - Shire plc | dp43275_8k.htm |
| EX-2.1 - EX-2.1 - Shire plc | dp43275_ex0201.htm |
| EX-99.1 - EXHIBIT 99.1 - Shire plc | dp43275_ex9901.htm |
Exhibit 99.2
SHIRE PLC
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
The following unaudited pro forma consolidated financial information of Shire plc (“the Company”) as of and for the nine months ended September 30, 2013 and for the years ended December 31, 2012 and 2011 give effect to the Company’s divestment of the DERMAGRAFT business to Organogenesis Inc (“Organogenesis”), which was completed on January 16, 2014 and announced on January 17, 2014.
The unaudited pro forma consolidated statements of income have been prepared to present the Company’s results of operations as if the transaction pursuant to the Asset Purchase Agreement had occurred on January 1, 2011, the earliest period in which DERMAGRAFT was included in the consolidated results of the Company. The Company acquired the DERMAGRAFT business through the acquisition of Advanced BioHealing Inc. (“ABH”) on June 28, 2011. Accordingly no pro forma adjustments are required to be made to the Company’s historical reported consolidated statement of income for the year ended December 31, 2010 as a result of this divestment and this period has not been presented.
The unaudited pro forma consolidated balance sheet has been prepared to present the Company’s financial position as if the transaction pursuant to the Asset Purchase Agreement had occurred on September 30, 2013.
The pro forma adjustments are based on currently available information and certain preliminary estimates and assumptions and, therefore, the actual effects of the divestment may differ from the effects reflected in the unaudited pro forma consolidated financial information.
The unaudited pro forma consolidated financial information is not intended to be indicative of the financial position or results of operations of the Company as of such dates or for such periods, nor are they indicative of future results. The unaudited pro forma financial information is prepared using different assumptions and principles to those that will be used by the Company in preparing financial information in accordance with US GAAP. As such they are not indicative of the financial information that will be presented in the Company’s future Annual Reports on Form 10-K or Quarterly Reports on Form 10-Q.
The unaudited pro forma consolidated financial information and the accompanying notes should be read together with the Company’s consolidated financial statements and the accompanying notes and the related “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012 and Quarterly Report on Form 10-Q for the nine months ended September 30, 2013.
SHIRE PLC
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
AS AT SEPTEMBER 30, 2013
|
As Reported
|
Pro Forma Adjustments
|
Pro Forma
|
|||||||||||
| $’M | $’M | $’M | |||||||||||
|
ASSETS
|
|||||||||||||
|
Current assets:
|
|||||||||||||
|
Cash and cash equivalents
|
1,686.1 | - | 1,686.1 | ||||||||||
|
Restricted cash
|
16.6 | - | 16.6 | ||||||||||
|
Accounts receivable, net
|
1,037.8 | (11.9 | ) |
(a)
|
1,025.9 | ||||||||
|
Inventories
|
480.5 | (20.5 | ) |
(a)
|
460.0 | ||||||||
|
Deferred tax asset
|
210.6 | (6.8 | ) |
(a)
|
203.8 | ||||||||
|
Prepaid expenses and other current assets
|
282.3 | - |
|
282.3 | |||||||||
|
Total current assets
|
3,713.9 | (39.2 | ) | 3,674.7 | |||||||||
|
Non-current assets:
|
|||||||||||||
|
Investments
|
36.7 | - | 36.7 | ||||||||||
|
Property, plant and equipment, net
|
965.1 | (29.0 | ) |
(a)
|
936.1 | ||||||||
|
Goodwill
|
621.3 | - | 621.3 | ||||||||||
|
Other intangible assets, net
|
2,976.0 | (621.3 | ) |
(a)
|
2,354.7 | ||||||||
|
Deferred tax asset
|
40.4 | (7.4 | ) |
(a)
|
33.0 | ||||||||
|
Other non-current assets
|
34.5 | 33.6 |
(b)
|
68.1 | |||||||||
|
Total assets
|
8,387.9 | (663.3 | ) | 7,724.6 | |||||||||
|
LIABILITIES AND EQUITY
|
|||||||||||||
|
Current liabilities:
|
|||||||||||||
|
Accounts payable and accrued expenses
|
1,581.6 | 2.0 |
(c)
|
1,583.6 | |||||||||
|
Convertible bonds
|
1,100.0 | - | 1,100.0 | ||||||||||
|
Other current liabilities
|
163.2 | - | 163.2 | ||||||||||
|
Total current liabilities
|
2,844.8 | 2.0 | 2,846.8 | ||||||||||
|
Non-current liabilities:
|
|||||||||||||
|
Deferred tax liability
|
722.0 | (228.0 | ) |
(a)
|
494.0 | ||||||||
|
Other non-current liabilities
|
652.3 | - | 652.3 | ||||||||||
|
Total liabilities
|
4,219.1 | (226.0 | ) | 3,993.1 | |||||||||
|
Equity:
|
|||||||||||||
|
Common stock of 5p par value; 1,000 million shares authorized; and 562.9 million shares issued and outstanding
|
55.8 | - | 55.8 | ||||||||||
|
Additional paid-in capital
|
3,045.6 | - | 3,045.6 | ||||||||||
|
Treasury stock: 13.4 million shares
|
(466.6 | ) | - | (466.6 | ) | ||||||||
|
Accumulated other comprehensive income
|
101.3 | - | 101.3 | ||||||||||
|
Retained earnings
|
1,432.7 | (437.3 | ) |
(d)
|
995.4 | ||||||||
|
Total equity
|
4,168.8 | (437.3 | ) | 3,731.5 | |||||||||
|
Total liabilities and equity
|
8,387.9 | (663.3 | ) | 7,724.6 | |||||||||
SHIRE PLC
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE NINE MONTHS TO SEPTEMBER 30, 2013
|
As Reported
|
Pro Forma Adjustments
|
Pro Forma results from continuing operations
|
|||||||||||
| $’M | $’M | $’M | |||||||||||
|
Revenues:
|
|||||||||||||
|
Product sales
|
3,541.8 | (64.7 | ) |
(e)
|
3,477.1 | ||||||||
|
Royalties
|
112.4 | - | 112.4 | ||||||||||
|
Other revenues
|
18.8 | - | 18.8 | ||||||||||
|
Total revenues
|
3,673.0 | (64.7 | ) | 3,608.3 | |||||||||
|
Costs and expenses:
|
|||||||||||||
|
Cost of product sales
|
528.7 | (36.4 | ) |
(e)
|
492.3 | ||||||||
|
Research and development
|
713.4 | (10.2 | ) |
(e)
|
703.2 | ||||||||
|
Selling, general and administrative
|
1,337.4 | (139.5 | ) |
(e)
|
1,197.9 | ||||||||
|
Goodwill impairment charge
|
198.9 | (191.8 | ) |
(f)
|
7.1 | ||||||||
|
Gain on sale of product rights
|
(14.6 | ) | - | (14.6 | ) | ||||||||
|
Reorganization costs
|
57.6 | (10.4 | ) |
(e)
|
47.2 | ||||||||
|
Integration and acquisition costs
|
39.9 | - | 39.9 | ||||||||||
|
Total operating expenses
|
2,861.3 | (388.3 | ) | 2,473.0 | |||||||||
|
Operating income
|
811.7 | 323.6 |
(e)
|
1,135.3 | |||||||||
|
Interest income
|
1.6 | - | 1.6 | ||||||||||
|
Interest expense
|
(27.0 | ) | (0.5 | ) |
(e)
|
(27.5 | ) | ||||||
|
Other income/(expense), net
|
(1.9 | ) | 0.3 |
(e)
|
(1.6 | ) | |||||||
|
Total other expense, net
|
(27.3 | ) | (0.2 | ) | (27.5 | ) | |||||||
|
Income / (loss) before income taxes and equity in (losses) / earnings of equity method investees
|
784.4 | 323.4 | 1,107.8 | ||||||||||
|
Income taxes
|
(183.9 | ) | (48.0 | ) |
(g)
|
(231.9 | ) | ||||||
|
Equity in (losses)/earnings of equity method investees, net of taxes
|
0.6 | - | 0.6 | ||||||||||
|
Net Income / (loss)
|
601.1 | 275.4 | 876.5 | ||||||||||
|
Earnings per ordinary share from continuing operations - basic
|
109.3 | c | 159.4 | c | |||||||||
|
Earnings per ordinary share from continuing operations - diluted
|
106.2 | c | 153.1 | c | |||||||||
|
Weighted average number of shares (millions):
|
|||||||||||||
|
Basic
|
549.8 | 549.8 | |||||||||||
|
Diluted
|
587.5 | 587.5 | |||||||||||
SHIRE PLC
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE YEAR TO DECEMBER 31, 2012
|
As Reported
|
Pro Forma Adjustments
|
Pro Forma results from continuing operations
|
|||||||||||
| $’M | $’M | $’M | |||||||||||
|
Revenues:
|
|||||||||||||
|
Product sales
|
4,406.7 | (153.8 | ) |
(e)
|
4,252.9 | ||||||||
|
Royalties
|
241.6 | - | 241.6 | ||||||||||
|
Other revenues
|
32.9 | - | 32.9 | ||||||||||
|
Total revenues
|
4,681.2 | (153.8 | ) | 4,527.4 | |||||||||
|
Costs and expenses:
|
|||||||||||||
|
Cost of product sales
|
645.4 | (59.6 | ) |
(e)
|
585.8 | ||||||||
|
Research and development
|
965.5 | (11.7 | ) |
(e)
|
953.8 | ||||||||
|
Selling, general and administrative
|
2,114.0 | (167.4 | ) |
(e)
|
1,946.6 | ||||||||
|
Gain on sale of product rights
|
(18.1 | ) | - | (18.1 | ) | ||||||||
|
Integration and acquisition costs
|
25.2 | (10.4 | ) |
(e)
|
14.8 | ||||||||
|
Total operating expenses
|
3,732.0 | (249.1 | ) | 3,482.9 | |||||||||
|
Operating income
|
949.2 | 95.3 |
(e)
|
1,044.5 | |||||||||
|
Interest income
|
3.1 | (0.1 | ) |
(e)
|
3.0 | ||||||||
|
Interest expense
|
(38.2 | ) | - | (38.2 | ) | ||||||||
|
Other income/(expense), net
|
(2.7 | ) | 0.5 |
(e)
|
(2.2 | ) | |||||||
|
Total other expense, net
|
(37.8 | ) | 0.4 | (37.4 | ) | ||||||||
|
Income / (loss) before income taxes and equity in (losses) / earnings of equity method investees
|
911.4 | 95.7 | 1,007.1 | ||||||||||
|
Income taxes
|
(167.0 | ) | (34.9 | ) |
(g)
|
(201.9 | ) | ||||||
|
Equity in (losses)/earnings of equity method investees, net of taxes
|
1.0 | - | 1.0 | ||||||||||
|
Net Income / (loss)
|
745.4 | 60.8 | 806.2 | ||||||||||
|
Earnings per ordinary share from continuing operations - basic
|
134.2 | c | 145.2 | c | |||||||||
|
Earnings per ordinary share from continuing operations - diluted
|
130.9 | c | 141.1 | c | |||||||||
|
Weighted average number of shares (millions):
|
|||||||||||||
|
Basic
|
555.4 | 555.4 | |||||||||||
|
Diluted
|
593.5 | 593.5 | |||||||||||
SHIRE PLC
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
FOR THE YEAR TO DECEMBER 31, 2011
|
As Reported
|
Pro Forma Adjustments
|
Pro Forma results from continuing operations
|
|||||||||||
| $’M | $’M | $’M | |||||||||||
|
Revenues:
|
|||||||||||||
|
Product sales
|
3,950.2 | (105.3 | ) |
(e)
|
3,844.9 | ||||||||
|
Royalties
|
283.5 | - | 283.5 | ||||||||||
|
Other revenues
|
29.7 | - | 29.7 | ||||||||||
|
Total revenues
|
4,263.4 | (105.3 | ) | 4,158.1 | |||||||||
|
Costs and expenses:
|
|||||||||||||
|
Cost of product sales
|
588.1 | (36.4 | ) |
(e)
|
551.7 | ||||||||
|
Research and development
|
770.7 | (6.2 | ) |
(e)
|
764.5 | ||||||||
|
Selling, general and administrative
|
1,751.4 | (75.7 | ) |
(e)
|
1,675.7 | ||||||||
|
Gain on sale of product rights
|
6.0 | - | 6.0 | ||||||||||
|
Reorganization costs
|
24.3 | - | 24.3 | ||||||||||
|
Integration and acquisition costs
|
13.7 | (13.7 | ) |
(e)
|
- | ||||||||
|
Total operating expenses
|
3,154.2 | (132.0 | ) | 3,022.2 | |||||||||
|
Operating income
|
1,109.2 | 26.7 |
(e)
|
1,135.9 | |||||||||
|
Interest income
|
1.9 | - | 1.9 | ||||||||||
|
Interest expense
|
(39.1 | ) | - | (39.1 | ) | ||||||||
|
Other income/(expense), net
|
18.1 | 0.4 |
(e)
|
18.5 | |||||||||
|
Total other expense, net
|
(19.1 | ) | 0.4 | (18.7 | ) | ||||||||
|
Income / (loss) before income taxes and equity in (losses) / earnings of equity method investees
|
1,090.1 | 27.1 | 1,117.2 | ||||||||||
|
Income taxes
|
(227.6 | ) | (9.9 | ) |
(g)
|
(237.5 | ) | ||||||
|
Equity in (losses)/earnings of equity method investees, net of taxes
|
2.5 | - | 2.5 | ||||||||||
|
Net Income / (loss)
|
865.0 | 17.2 | 882.2 | ||||||||||
|
Earnings per ordinary share from continuing operations - basic
|
156.9 | c | 160.1 | c | |||||||||
|
Earnings per ordinary share from continuing operations - diluted
|
150.9 | c | 153.8 | c | |||||||||
|
Weighted average number of shares (millions):
|
|||||||||||||
|
Basic
|
551.1 | 551.1 | |||||||||||
|
Diluted
|
595.4 | 595.4 | |||||||||||
SHIRE PLC
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
(a) Adjustments to eliminate the assets and liabilities that were transferred to Organogenesis as part of the divestment, including estimated related deferred tax adjustments.
(b) Adjustment to reflect the estimated fair value of contingent consideration receivable of $33.6 million recognized as a result of the divestment of the DERMAGRAFT business.
(c) Adjustment to record estimated direct transaction costs of $2.0 million. The unaudited pro forma consolidated statements of income do not reflect nonrecurring direct transaction costs of $2.0 million.
(d) Adjustment to reflect the $437.3 million loss on disposal and associated impairment charges arising on the divestment of the DERMAGRAFT business, net of related deferred tax adjustments.
(e) Adjustments to reflect the removal of the historical results of the DERMAGRAFT business as if the transaction had occurred on January 1, 2011, including the costs of acquiring and integrating ABH.
(f) Adjustment to reflect the removal of the historical goodwill impairment charge of $191.8 million related to the DERMAGRAFT business.
(g) Related tax impact of pro forma adjustments, at the estimated statutory tax rate in effect (36.5%). The goodwill impairment charge recorded in the unaudited pro forma consolidated statement of income for the nine months ended September 30, 2013 is not tax deductible and has not been tax effected.