DUBLIN, Ireland–(BUSINESS WIRE)–May 13, 2004–Elan Corporation, plc today announced its first quarter 2004 results and provided an update on the progress of its product development activities.Commenting on the results Kelly Martin, Elan’s President and Chief Executive Officer, said ” In the first quarter of 2004, we continued our execution momentum across our core therapeutic areas of neurodegenerative diseases, autoimmune diseases and severe pain. Our key second-quarter filings are on track - Antegren for multiple sclerosis in the United States and Europe, and Prialt for severe pain in the United States - and we continue discussions with the United States and European regulators regarding potential filings for Antegren as a treatment in Crohn’s disease. Operationally, we are preparing for the anticipated launches of Antegren and Prialt, with specific targeted investments in the specialised infrastructure and personnel required for successful product launches.”The financial highlights of Elan’s performance from continuing operations are set out below. The results of the group’s discontinued operations under U.S. GAAP are presented as a separate component of net loss for the current and prior periods. Details of the group’s discontinued operations are discussed on page 8.
First Quarter 2004 Financial Highlights - Continuing Operations
— Total revenue decreased 29% to $159.0 million compared to
$224.7 million in the first quarter of 2003 due principally to
the divestment of a number of products as part of the
completed recovery plan.
— Revenue from retained products increased 7% to $75.4 million
from $70.5 million in the first quarter of 2003.
— Net loss from continuing operations was reduced by 52% to
$67.1 million ($0.17 loss per share) from $140.2 million
($0.40 loss per share) in the first quarter of 2003.
— Total operating expenses were reduced by 29% to $212.6 million
from $298.9 million in the first quarter of 2003.
— Negative EBITDA was reduced by 57% to $32.4 million from $75.4
million in the first quarter of 2003. (See “Non-GAAP Financial
Information” on page 5).
— Net investment related gains of $10.7 million compared to net
investment losses of $39.4 million in the first quarter of
2003.
— Cash and cash equivalents at March 31, 2004 of $910.9 million
compared to $807.5 million at December 31, 2003.
— The sale of Elan’s interests in Zonegran(TM) to Eisai Co.,
Ltd. and Eisai Inc. was completed realising approximately $130
million in April 2004. Additional future deferred purchase
payments of up to $110.0 million could be received.
— Agreed to terminate the development and license agreements
regarding Frova(TM) and to sell Elan’s commercialisation
rights for Frova to Vernalis plc for up to $55.0 million.
R&D Highlights
— Elan, in collaboration with Biogen Idec is on target to submit
a Biologics License Application (”BLA”) to the U.S. Food and
Drug Administration (”FDA”) and a Marketing Authorisation
Application (”MAA”) to the European Agency for the Evaluation
of Medicinal Products (”EMEA”) for Antegren(TM) (natalizumab)
as a potential treatment for multiple sclerosis (”MS”) in the
second quarter of 2004.
— Elan, in collaboration with Biogen Idec, continues its
discussions with the regulatory agencies in the United States
and Europe regarding the timing of filings for Antegren as a
potential treatment in Crohn’s disease. Data from the Phase
III induction trial (ENACT-1) and the maintenance trial
(ENACT-2) for Crohn’s disease will be presented at the
Digestive Disease Week meeting in New Orleans next week.
— During the first quarter of 2004, two new trials with Antegren
were initiated: A Phase III induction study to evaluate
Antegren in patients with Crohn’s disease and a Phase II trial
to evaluate Antegren in patients suffering from rheumatoid
arthritis.
— In January 2004, Elan announced that it had met the primary
endpoint in its Phase III trial evaluating Prialt(TM)
(ziconotide) in patients with severe chronic pain. Based on
the positive results, the company is on target to file a
supplement to its New Drug Application (”sNDA”) with the FDA
in the second quarter of 2004.
Three Months
Ended March 31
Unaudited Consolidated US GAAP Income Statement Data 2003 2004
US$m US$m
———————————————————————-
Revenue (see page 
Product revenue 181.9 133.5
Contract revenue 42.8 25.5
—————
Total revenue 224.7 159.0
—————
Operating Expenses (see page 12)
Research & development 82.6 67.5
Cost of goods sold 74.4 50.3
Selling, general & administrative 119.8 85.7
Loss on disposal of businesses (net) 5.6 3.7
Recovery plan and other significant charges 16.5 5.4
—————
Total operating expenses 298.9 212.6
—————
Operating loss (74.2) (53.6)
—————
Net Interest and Investment Gains and Losses (see page
13)
Net interest expense (23.2) (23.3)
Investment gains - 44.8
Investment losses and other (39.4) (34.1)
—————
Net interest and investment gains and losses (62.6) (12.6)
—————
Net loss from continuing operations before tax (136.8) (66.2)
Taxation (3.4) (0.9)
—————
Net loss before discontinued operations (140.2) (67.1)
Net income from discontinued operations (see page 17) 12.7 4.9
—————
Net loss (127.5) (62.2)
===============
Basic and diluted loss per ordinary share - continuing
operations ($0.40)($0.17)
Basic and diluted income per ordinary share -
discontinued operations $0.04 $0.01
Basic and diluted loss per ordinary share - net loss ($0.36)($0.16)
Weighted average number of ordinary shares outstanding
(millions) 349.9 385.9
Three Months
Non-GAAP Financial Information Reconciliation Schedule Ended March 31
2003 2004
US$m US$m
EBITDA
Operating loss (74.2)(53.6)
Depreciation and amortisation included in operating loss 39.5 32.8
Amortised revenue included in total revenue (40.7)(11.6)
————
EBITDA (see page 13) (75.4)(32.4)
============
To supplement our consolidated financial statements presented on a U.S. GAAP basis, Elan provides readers with EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation), a non-GAAP measure of operating results. Elan has also provided EBITDA guidance for 2004, which has been calculated on a consistent basis. EBITDA is defined as operating income/(loss) plus/minus depreciation and amortisation of costs and revenues. EBITDA is not presented as an alternative measure of operating results or cash flow from operations, as determined in accordance with U.S. GAAP. Elan’s management uses EBITDA to evaluate the operating performance of Elan and its business and is among the factors considered as a basis for Elan’s planning and forecasting for future periods. Elan believes EBITDA is a measure of performance used by some investors, equity analysts and others to make informed investment decisions. EBITDA is used as an analytical indicator of income generated to service debt and to fund capital expenditures. EBITDA does not give effect to cash used for interest payments related to debt service requirements and does not reflect funds available for investment in the business of Elan or for other discretionary purposes. EBITDA, as presented in this press release, may not be comparable to similarly titled measures reported by other companies. A reconciliation of EBITDA to operating loss is set out in the table above titled “Non-GAAP Financial Information Reconciliation Schedule”.
Unaudited Balance Sheet Data December 31 March 31
2003 2004
Assets US$m US$m
———————————————————————-
Current Assets
Cash and cash equivalents 807.5 910.9
Marketable investment securities 349.4 331.8
Held for sale assets (1) 211.1 77.2
Other current assets 200.6 192.1
——————
1,568.6 1,512.0
Intangible assets 880.4 884.0
Property, plant and equipment 369.1 324.5
Investments and marketable investment securities 192.9 160.0
—————-
Total Assets 3,011.0 2,880.5
——————
Liabilities and Shareholders’ Equity
Shareholders’ equity 599.1 536.4
Accounts payable and accrued liabilities 365.3 333.8
Held for sale liabilities 27.9 7.2
Deferred income 154.8 142.9
Guarantee provision - EPIL II due June 2004 344.5 358.3
Product acquisition payments 19.4 1.9
6.5% convertible guaranteed notes due 2008 460.0 460.0
EPIL III Notes due 2005 390.0 390.0
7.25% senior notes due 2008 650.0 650.0
—————-
Total Liabilities and Shareholders’ Equity 3,011.0 2,880.5
——————-
Reconciliation of Movement in Shareholders’ Equity US$m
At December 31, 2003 599.1
Net loss for the three months ended March 31, 2004 (62.2)
Movement on unrealised gains on securities (7.3)
Other 6.8
——–
At March 31, 2004 536.4
——–
(1) In accordance with SFAS No. 144, Elan has recorded as held for
sale the assets and liabilities related to the Zonegran product, the
divestiture of which was closed during the second quarter of 2004. As
at December 31, 2003, Elan also recorded as held for sale the assets
and liabilities related to its former European sales and marketing
business and Elan Pharma S.A., a manufacturing and research and
development business based in Mezzovia, Switzerland. Each of these
divestments closed during the first quarter of 2004.
Three Months Ended March 31
2003 2004
Unaudited Cash Flow Data US$m US$m
———————————————————————-
Cashflows from operating activities (66.4) (26.9)
Movement on debt interest and tax (24.0) (25.7)
Working capital movement (1.9) (32.3)
Net (purchase of)/sale of tangible assets (8.6) 30.3
Net proceeds from sale of investments 153.5 56.8
Net purchase of intangible assets (64.6) (35.3)
Proceeds of business disposals 6.2 133.7
Cash flows from financing activities (1.7) 2.8
———————————————————————-
Net Cash Movement (7.5) 103.4
Cash and cash equivalents at beginning of period 1,013.9 807.5
———————————————————————-
Cash and cash equivalents at end of period 1,006.4 910.9
———————————————————————-
In 2003, in accordance with SFAS No. 144 “Accounting for the Impairment or Disposal of Long-Lived Assets”, Elan recorded the results and gains or losses on the divestment of its discontinued operations including Elan Transdermal Technologies, Athena Diagnostics, Elan Diagnostics, a manufacturing business in Italy, the pain portfolio of products, Actiq(TM), the dermatology portfolio of products and Abelcet(TM) U.S./Canada within discontinued operations in the income statement. In the first quarter of 2004, the results and gains on the divestments of two products, which were marketed in the United Kingdom and Ireland, were also included as discontinued operations. Consequently, the revenues and costs of the first quarter in 2003 have been adjusted to reflect this treatment. There is no impact on the net loss in prior quarters. An analysis of the results of the discontinued operations is set out in Appendix 2.During the course of the recovery plan, Elan sold a number of other assets and businesses (principally the primary care franchise and the European sales and marketing business), which in accordance with SFAS No. 144 are not included in discontinued operations. Elan believes that it has a significant continuing involvement in the operations of these businesses, for example through ongoing supply arrangements or formulation activities.The analysis below is based on the revenues and costs from continuing operations presented in accordance with U.S. GAAP.RevenueTotal revenue decreased 29% to $159.0 million in the first quarter of 2004 from $224.7 million in the first quarter of 2003. An analysis of total revenue is set out on Appendix 1.Elan’s product revenue is analysed between revenue generated from currently retained products and revenue arising from products that have been divested or are subject to divestment agreements (including the Zonegran and Frova products).
Total revenue can be further analysed as follows:
Three Months Ended March 31
2003 2004
(a) Product Revenue US$m US$m
Revenue from retained products 70.5 75.4
Revenue from divested products 102.9 49.6
Amortised revenue - Adalat/Avinza 8.5 8.5
————
Total product revenue 181.9 133.5
————
(b) Contract Revenue
Amortisation of fees 32.2 3.1
Research revenue and milestones 10.6 22.4
————
Total contract revenue 42.8 25.5
————
Total Revenue 224.7 159.0
————
(a) Product RevenueTotal product revenue for the first quarter of 2004 was $133.5 million compared to $181.9 million in the first quarter of 2003, a decrease of 27%. The decline in product revenue in 2004 is due principally to the divestment of a number of products as part of the recovery plan.Revenue from retained productsRevenue from retained products was $75.4 million in the first quarter of 2004 compared to $70.5 million in the first quarter of 2003, an increase of 7%. This increase primarily reflects the growth in prescriptions and demand for those retained products offset by a reduction in revenue from contract manufacturing and royalties.Sales of Maxipime(TM) and Azactam(TM) in the first quarter of 2004 were $42.0 million, an increase of 24% over the comparable period in 2003, reflecting stronger demand in 2004 and lower revenues in 2003 due to adjusting wholesaler inventories. Sales in the first quarter of 2004 were in line with the fourth quarter of 2003. Maxipime audited sales volumes for the first quarter of 2004 increased by 5.4% compared to the same period in 2003 while revenues increased from $18.4 million to $28.2 million. Azactam audited sales volumes for the first quarter of 2004 increased by 6% compared to the same period in 2003 while revenues decreased from $15.6 million to $13.8 million.Contract manufacturing and royalties were $24.1 million in the first quarter of 2004 compared to $30.8 million in the first quarter of 2003 and $23.0 million in the fourth quarter of 2003. The decline in contract manufacturing and royalty revenue of 22% when compared to the same quarter of 2003 was primarily due to wholesaler activity in relation to the Verelan(TM) product in 2003.Revenue from divested productsAs previously announced in March 2004, Elan agreed to sell its rights to Zonegran and Frova, including related inventories. The sale of Zonegran closed on April 27, 2004, resulting in total consideration of approximately $130 million before making a $17.0 million payment to Dainippon Pharmaceutical Co., Ltd. related to the assignment of the Zonegran license agreements. Further deferred consideration of up to $110.0 million (including a $25.0 million milestone on the receipt of European regulatory approval for Zonegran) may be received in 2004 and 2005 provided no generic competitor product enters the market prior to December 31, 2005. The sale of Frova is expected to close in the second quarter of 2004 and will result in payments to Elan estimated at a total of $55.0 million in the period to December 31, 2005. On closing Elan will pay about $10.0 million to terminate arrangements with UCB.Product revenue from these businesses and products was $36.7 million in the first quarter of 2004 compared to $21.2 million in the first quarter of 2003. The book value of intangible assets associated with Zonegran and Frova were $47.6 million and $22.4 million, respectively, at March 31, 2004. Inventories held at March 31, 2004, were approximately $30 million for Zonegran and approximately $5 million for Frova.In February 2003, Elan announced the completion of the sale of its European sales and marketing business to Medeus Pharma Limited, a new U.K. pharmaceutical company backed by Apax Partners Funds. The total consideration amounted to approximately $120 million (subject to adjustment for certain movements in indebtedness and working capital in the period to completion) and approximately 180 employees of Elan’s European sales and marketing business transferred their employment to Medeus Pharma Limited. Product revenue from this business was $10.6 million in the first quarter of 2004 compared to $25.6 million in the first quarter of 2003.During 2002 and 2003 Elan sold a number of other products and businesses, which contributed $56.1 million to product revenue in the first quarter of 2003 compared to $2.3 million in the first quarter of 2004.Amortised Product RevenueThe first quarter of 2004 and 2003 includes $8.5 million of amortised revenue related to the licensing of rights to Elan’s generic form of Adalat CC and the restructuring of Elan’s Avinza(TM) license agreement with Ligand Pharmaceuticals, Inc. The remaining unamortised revenue on these products of $94.7 million will be recognised as revenue over the next three years reflecting Elan’s ongoing involvement in the manufacture of these products.(b) Contract RevenueContract revenue in the first quarter of 2004 was $25.5 million compared to $42.8 million in the same period of 2003, a decrease of 40%. The amortisation of fees amounted to $3.1 million in the first quarter of 2004 compared to $32.2 million in the first quarter of 2003. Of the $32.2 million in amortised fees in the first quarter of 2003, $25.6 million (2004: $nil), related to business ventures.As part of the recovery plan outlined on July 31, 2002, Elan completed a review of its business venture programme and, as a result, all of the business ventures have been terminated, restructured or are now inactive. The reduction in amortised fees during the first quarter of 2004 arose primarily from the restructuring and termination of business ventures, which started in 2002. There are no remaining unamortised fees from the business ventures at March 31, 2004.Research revenue and milestones amounted to $22.4 million in the first quarter of 2004 compared to $10.6 million in the first quarter of 2003 reflecting an increase in milestones earned by Elan’s drug delivery business. This increase results primarily from the receipt of a milestone payment from King Pharmaceuticals Inc. (”King”) of $11.0 million in respect of Sonata(TM).Gross ProfitThe gross profit margin on product revenue was 62% in the first quarter of 2004 compared to 59% in the first quarter of 2003. The increase in the gross margin in 2004 principally reflects the payment of royalties to Pharma Marketing Ltd. (”Pharma Marketing”) in the first quarter of 2003 of $11.9 million, which is included in cost of sales. No royalties were paid to Pharma Marketing in the first quarter of 2004, following the termination of all remaining agreements with Pharma Marketing in the fourth quarter of 2003.Operating ExpensesResearch and development expenses were $67.5 million in the first quarter of 2004 compared to $82.6 million in the first quarter of 2003. This reduction reflects the refocusing of research and development efforts on key programmes: Antegren, Prialt and the Alzheimer’s programmes. Selling, general and administrative expenses decreased by 28% to $85.7 million in the first quarter of 2004 from $119.8 million in the first quarter of 2003. This year over year decline is expected to continue in 2004 but at a slower pace reflecting the successful implementation of the recovery plan and related cost reduction initiatives.Operating expenses in the first quarter of 2004 in respect of the European sales and marketing business which was divested during the quarter, and the Zonegran and Frova products for which agreements to divest were executed during the first quarter of 2004 amounted to $38.5 million. Included in the $38.5 million is $15.0 million in respect of cost of goods sold, and $23.5 million in respect of selling general and administration expenses.
Recovery Plan and Other Significant Charges / Gains
Three Months Ended March 31
2003 2004
US$m US$m
Net loss on divestment of businesses 5.6 3.7
Severance costs, relocation and exit costs 3.1 1.8
Costs related to shareholder litigation,
SEC investigation 3.0 4.3
Other 10.4 (0.7)
————
22.1 9.1
————
Negative EBITDAEBITDA for the first quarter of 2004 was negative $32.4 million compared to $75.4 million in the first quarter 2003. The reduction in negative EBITDA results primarily from the improvement in gross margin, the receipt of milestones from King and the reduction in operating expenses of 29%.Net Interest and Investment Gains and LossesNet interest and investment gains and losses amounted to a loss of $12.6 million in the first quarter of 2004 compared to a loss of $62.6 million in the first quarter of 2003.In the first quarter of 2004, net interest expense amounted to $23.3 million compared to $23.2 million in the first quarter of 2003, reflecting the interest costs associated with the $460.0 million convertible notes issued in the fourth quarter of 2003, offset by lower interest expense due to Liquid Yield Option Notes (”LYONs”) repurchases. The gain on investments in the first quarter of 2004 of $44.8 million included realised gains on investment disposals of $32.1 million and $12.7 million in relation to the mark-to-market of certain investments including managed funds. This gain was offset by investment and other losses of $34.1 million including investment impairments of $16.0 million and an increase in the EPIL II guarantee provision of $13.8 million.In addition, as a result of the sale of certain publicly quoted investments and the mark-to-market of others, there was a net reduction in unrealised gains recorded as part of shareholders’ equity of $7.3 million.LiquidityAt March 31, 2004, Elan had $910.9 million in cash and cash equivalents compared with $807.5 million at December 31, 2003.At March 31, 2004, the major contracted and potential non-operating cash payments relating to Elan’s business are:
Less 4 years
than 1-3 and Total Dec 2003
One years after US$m US$m
year US$m US$m
US$m
———————————————————————-
7.25% Senior Notes (2008) - - 650.0 650.0 650.0
6.5% Convertible Notes - - 460.0 460.0 460.0
Fixed Product Payments 1.9 - - 1.9 19.4
EPIL II (1) 450.0 - - 450.0 450.0
EPIL III - 390.0 - 390.0 390.0
3.25% LYONs - - 0.9 0.9 0.9
Capital Lease Obligations (2) 10.0 20.3 51.5 81.8 85.4
————————————
461.9 410.3 1,162.4 2,034.6 2,055.7
Operating Lease Obligations (2) 15.3 31.7 96.8 143.8 157.6
————————————
Total 477.2 442.0 1,259.2 2,178.4 2,213.3
———————————————————————-
(1) In order to comply with U.S. GAAP, $358.3 million of this amount (2003: $344.5 million) is provided on the balance sheet.(2) In accordance with SEC Release No.43-47264 “Disclosure in Management’s Discussion and Analysis about Off-Balance Sheet Arrangements and Aggregate Contractual Obligations”, which is effective for financial statements ending on or after December 15, 2003, operating and capital lease obligations have been included in the table of contractual and potential future payments.Qualifying Special Purpose Entity (”QSPE”)Elan has guaranteed loan notes issued by EPIL II (a QSPE, which is not consolidated under U.S. GAAP) to the extent that the investments held by it are insufficient to repay the loan notes and accrued interest when they fall due. The aggregate principal amount outstanding under the loan notes issued by EPIL II was $450.0 million at March 31, 2004, and is repayable on June 28, 2004. The investments held by EPIL II will be sold to meet the maturity of the loan notes. The estimated value of the investment portfolio at March 31, 2004, using established financial valuation methodologies consistent with the requirements of U.S. GAAP and which does not reflect any liquidity discount, was $67.1 million. In addition, EPIL II had cash and receivable balances of $35.8 million.During the first quarter of 2004, Elan increased the provision for its guarantee by $13.8 million to $358.3 million, reflecting the net reduction in the value of the investments held by EPIL II during this period after charging interest of $10.9 million for the quarter. After providing for the estimated investment shortfalls, the carrying values and cash position of EPIL II were as follows:
US$m
Investments in public companies 61.0
Investments in private companies 6.1
Cash and amounts due from investment disposals 35.8
Accrued interest and expenses (11.2)
—————
Total assets 91.7
Provision for guarantees 358.3
—————
Total guaranteed indebtedness 450.0
—————
About ElanElan is a neuroscience-based biotechnology company that is focused on discovering, developing, manufacturing and marketing of advanced therapies in neurology, autoimmune diseases and severe pain. Elan (NYSE: ELN) shares trade on the New York, London and Dublin Stock Exchanges.This document contains forward-looking statements about Elan’s financial condition, results of operations and business prospects that involve substantial risks and uncertainties. You can identify these statements by the fact that they use words such as “anticipate”, “estimate”, “project”, “envisage”, “guidance” “intend”, “plan”, “believe” and other words and terms of similar meaning in connection with any discussion of future operating or financial performance or events. Among the factors that could cause actual results to differ materially from those described or projected herein are the following: Elan’s intent to file with the FDA and the EMEA for approval for Antegren for MS; a delay in filing the Antegren BLA or MAA for MS; the potential of Antegren as a treatment for MS and Crohn’s disease; Elan’s intent to file the sNDA with the FDA for Prialt; a delay in filing the sNDA for Prialt; the potential of Prialt as an intrathecal treatment for severe pain; Elan’s ability to maintain sufficient cash, liquid resources, and investments and other assets capable of being monetised to meet its liquidity requirements; the outcome of the ongoing SEC investigation and the shareholder and other pending litigation; the success of research and development activities and the speed with which regulatory authorisations and product launches may be achieved; competitive developments affecting Elan’s current products; the ability to successfully market both new and existing products; difficulties or delays in manufacturing; the ability to meet generic and branded competition after the expiration of Elan’s patents; the trend towards managed care and health care cost containment; possible legislation affecting pharmaceutical pricing; exposure to product liability and other types of lawsuits; Elan’s ability to protect its intellectual property; interest rate and foreign currency exchange rate fluctuations; governmental laws and regulations affecting domestic and foreign operations, including tax obligations; general changes in U.S. and Irish generally accepted accounting principles; growth in costs and expenses; changes in product mix; the impact of acquisitions, divestitures, restructurings, product withdrawals and other unusual items. A further list and description of these risks, uncertainties and other matters can be found in Elan’s Annual Report on Form 20-F for the fiscal year ended December 31, 2003, and in its Reports of Foreign Issuer on Form 6-K. Elan assumes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.
Appendix 1
Revenue Analysis - (Unaudited) Three
Months Ended March, 31
2003 2004
US$m US$m
Revenue from Retained Products
U.S. Promoted Products
Maxipime 18.4 28.2
Azactam 15.6 13.8
Myobloc 3.5 3.6
————-
37.5 45.6
U.S. Non-promoted Products
Zanaflex 0.8 0.4
Other 1.4 5.3
————-
2.2 5.7
Contract Manufacturing and Royalties 30.8 24.1
Total Revenue from Retained Products 70.5 75.4
Revenue from Divested Products (1)
Skelaxin 27.2 -
Sonata 21.3 -
European business 25.6 10.6
Zonegran 12.4 30.0
Frova 8.8 6.7
Other 4.2 0.2
Rationalisation programme 3.4 2.1
————-
102.9 49.6
Amortised Revenue - Adalat/Avinza 8.5 8.5
Total Product Revenue 181.9 133.5
Contract Revenue
Amortisation of fees 32.2 3.1
Research revenue and milestones 10.6 22.4
————-
Total Contract Revenue 42.8 25.5
————-
Total Revenue 224.7 159.0
————-
(1) Products that have been divested or are subject to
divestment agreements
Appendix 2
Discontinued Operations (unaudited)
Three Months Ended March, 31
2003 2004
US$m US$m
———————————————————————-
Revenue
Product revenue (1) 45.8 5.1
Contract revenue - -
————-
Total revenue 45.8 5.1
————-
Operating Expenses
Research & development 4.2 -
Cost of goods sold 18.4 0.3
Selling, general & administrative 7.9 -
Loss on disposal of businesses (net) 0.8 -
Recovery plan and other significant charges 0.7 -
————-
Total operating expenses 32.0 0.3
————-
Operating profit 13.8 4.8
————-
Net Interest and Investment Losses
Net interest expense - -
Investment gains - -
Investment losses and other (1.0) 0.1
————-
Net interest and investment losses (1.0) 0.1
————-
Net income from discontinued operations before tax 12.8 4.9
Taxation (0.1) -
————-
Net income from discontinued operations 12.7 4.9
————-
Non-GAAP Financial Information
EBITDA
Operating profit 13.8 4.8
Depreciation and amortisation included in operating
profit 5.1 -
Amortised revenue included in total revenue (10.5) -
————-
EBITDA 8.4 4.8
Loss on divestment of businesses (net) 0.8 -
Recovery plan and other significant charges 0.7 -
————-
EBITDA before net losses on disposal of businesses and
recovery plan related charges 9.9 4.8
————-
(1) Includes net proceeds from the sale of product rights of $4.3
million in the first quarter of 2004 (2003: $10.5 million).