On July 26, Shire
- Revenue rose 31%, led by improved sales of Adderall XR and Daytrana in a growing attention deficit/hyperactivity disorder (ADHD) market. Adderall XR is the top drug in the U.S. ADHD market, with 26% market share.
- The company posted a loss of $1.8 billion, primarily because of in-process R&D expenses of $1.9 billion associated with the acquisition of New River Pharmaceuticals.
- Shire acquired New River for $2.6 billion to strengthen its ADHD portfolio as it gains control over Vyvanse, New River Pharmaceutical's new ADHD drug. The drug launched in June.
- In May 2007, Shire issued $1.1 billion principal amount of convertible bonds due 2014. This was done to finance the New River acquisition.
- The company has upped its revenue growth guidance to more than 25% for the year.
(Figures in millions, except per-share data.)
Income Statement Highlights
|
Q2 2007 |
Q2 2006 |
Change |
|
|---|---|---|---|
|
Sales |
$574.9 |
$439.1 |
30.9% |
|
Net Profit |
($1,811.3) |
$61.3 |
N/A |
|
EPS* |
($9.93) |
$0.36 |
N/A |
|
Diluted Shares** |
182.4 |
169.8 |
7.4% |
**Number of ADS outstanding.
Get back to basics with the income statement.
Margin Checkup
|
Q2 2007 |
Q2 2006 |
Change* |
|
|---|---|---|---|
|
Gross Margin |
87.8% |
86% |
1.8 |
|
Operating Margin |
(308.8%) |
18.7% |
(327.5) |
|
Net Margin |
(315.1%) |
14% |
(329.0) |
Margins are the earnings engine.
Balance Sheet Highlights
|
Assets |
Q2 2007 |
Q2 2006 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$598.5 |
$886.6 |
(32.5%) |
|
Accounts Rec. |
$413.4 |
$309.2 |
33.7% |
|
Inventory |
$177.6 |
$123.5 |
43.8% |
|
Liabilities |
Q2 2007 |
Q2 2006 |
Change |
|---|---|---|---|
|
Accounts Payable* |
$681.6 |
$448.9 |
51.8% |
|
Long-Term Debt |
$1,100.0 |
$0.0 |
N/A |
The balance sheet reflects the company's health.
Cash Flow Highlights
|
Q2 2007 |
Q2 2006 |
Change |
|
|---|---|---|---|
|
Cash From Ops. |
$183.0 |
$137.4 |
33.2% |
|
Capital Expenditures |
$19.3 |
$74.1 |
(74%) |
|
Free Cash Flow |
$163.7 |
$63.3 |
158.6% |
Free cash flow is a Fool's best friend.
Related Foolishness:
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