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| AMGN > SEC Filings for AMGN > Form 8-K on 26-Jan-2009 | All Recent SEC Filings |
26-Jan-2009
Results of Operations and Financial Condition, Financial Statements and Exhibits
On January 26, 2009, Amgen Inc. (the "Company") issued a press release announcing its unaudited results of operations and financial condition for the three and twelve months ended December 31, 2008. The full text of the press release is set forth in Exhibit 99.1 attached hereto.
In its press release the Company included certain historical non-U.S. Generally Accepted Accounting Principles ("non-GAAP") financial measures as defined in Regulation G promulgated by the Securities and Exchange Commission with respect to its results of operations for the three and twelve months ended December 31, 2008 and 2007. Reconciliations for such historical non-GAAP financial measures are attached to the press release set forth as Exhibit 99.1 attached hereto. The Company believes that its presentation of historical non-GAAP financial measures provides useful supplementary information to and facilitates additional analysis by investors. These historical non-GAAP financial measures are in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with U.S. Generally Accepted Accounting Principles ("GAAP").
Three and twelve months ended December 31, 2008
For the three and twelve months ended December 31, 2008, the Company's
adjustments to GAAP financial measures relate to amounts associated with the
impact of expensing stock options in accordance with Statement of Financial
Accounting Standards No. 123R ("SFAS No. 123R"), charges related to the
Company's restructuring plan announced in August 2007, which, for the three and
twelve months ended December 31, 2008, principally relate to (i) asset
impairment charges principally incurred in connection with the rationalization
of our worldwide manufacturing operations in order to gain cost efficiencies,
(ii) charges primarily related to loss accruals for leases principally related
to certain facilities that will not be used in our business (iii) integration
costs associated with certain restructuring initiatives (iv) severance and other
separation costs and (v) the loss accrual on the disposal of certain less
significant marketed products and related assets (collectively, the "2008
Restructuring Amounts"), charges related to the Company's acquisitions of
Avidia, Inc. in October 2006 (the "Avidia Acquisition"), Abgenix, Inc. in April
2006 (the "Abgenix Acquisition"), and Immunex Corporation in July 2002 (the
"Immunex Acquisition"), and charges related to the loss accruals for settlements
of certain commercial legal proceedings (the "Legal Accruals"), and for the
twelve months ended December 31, 2008, charges related to the write-off of
inventory resulting from a strategic decision to change manufacturing processes
(the "2008 Inventory Charge") and charges related to the Company's acquisition
of Alantos Pharmaceutical Holding, Inc. in July 2007 (the "Alantos Acquisition")
. For the three and twelve months ended December 31, 2008, the Company's
adjustments to GAAP financial measures also include the tax effect of the
adjustments in 2008 discussed below, excluding (i) certain components of the
2008 Inventory Charge, (ii) certain of the 2008 Restructuring Amounts and
(iii) certain of the Legal Accruals (the "2008 Tax Effect").
For the three and twelve months ended December 31, 2008, the Company reported non-GAAP financial results for cost of sales (excluding amortization of acquired intangible assets) ("COS") expense, research and development ("R&D") expense, selling, general and administrative ("SG&A") expense, interest and other income and (expense), net and diluted shares used in the calculation of adjusted earnings per share. For the three and twelve months ended December 31, 2008, COS expense, R&D expense and SG&A expense were adjusted to exclude the effects of expensing stock options in accordance with SFAS No. 123R. Diluted shares used in the calculation of adjusted earnings per share were also adjusted to exclude the effects of adopting SFAS No. 123R. The Company believes that excluding the impact of expensing stock options and the related effects of adopting SFAS No. 123R provides supplemental measures that will facilitate comparisons between periods before and during when such expenses are incurred. For the three and twelve months ended December 31, 2008, COS expense, SG&A expense and interest and other income and (expense), net were adjusted to exclude the 2008 Restructuring Amounts and R&D expense was also adjusted to exclude the ongoing non-cash amortization of the R&D technology intangible assets acquired with the Abgenix Acquisition and the Avidia Acquisition (the "R&D Technology Intangible Assets' Amortization"). For the twelve months ended December 31, 2008,
For the three and twelve months ended December 31, 2008, the Company reported non-GAAP adjusted provisions for income taxes, adjusted net income and adjusted earnings per share excluding, where applicable, the foregoing expense amounts and the effects of adopting SFAS No. 123R on diluted shares used in the calculation of adjusted earnings per share for the reasons discussed above, the non-cash amortization of acquired intangible assets associated with the Immunex Acquisition (primarily EnbrelŪ) (the "Immunex Intangible Assets' Amortization"), the 2008 Restructuring Amounts, the Legal Accruals, and the 2008 Tax Effect. The Company believes that excluding the 2008 Restructuring Amounts provides a supplemental measure that will facilitate comparisons between periods before, during and after such expenses are incurred. The Company believes that excluding the Legal Accruals provides a supplemental measure that will facilitate comparisons between periods in which such items did not occur. The Company believes that excluding the Immunex Intangible Assets' Amortization treats those assets as if the Company had developed them internally in the past, and thus provides a supplemental measure of profitability in which the Company's acquired intellectual property is treated in a comparable manner to its internally developed intellectual property. The Company believes that excluding the 2008 Tax Effect provides a supplemental measure that will facilitate comparisons before, during and after the related adjustments have occurred.
Three and twelve months ended December 31, 2007
For the three and twelve months ended December 31, 2007, the Company's
adjustments to GAAP financial measures relate to amounts associated with the
impact of expensing stock options in accordance with SFAS No. 123R, charges
related to the Company's restructuring plan announced in August 2007, which, for
the three and twelve months ended December 31, 2007, principally relate to
(i) severance and other separation costs partially offset by the reversal of
previously accrued expenses for bonuses and stock-based compensation awards,
which were forfeited as a result of the employees' termination, (ii) asset
impairment charges principally incurred in connection with the rationalization
of our worldwide manufacturing operations in order to gain cost efficiencies
and, to a lesser degree, the moderation of the expansion of our R&D facilities,
(iii) accelerated depreciation resulting from our decision to accelerate closure
of one of our ENBREL commercial bulk production operations in connection with
the rationalization of our worldwide network of manufacturing facilities,
(iv) charges primarily related to loss accruals for leases principally related
to certain facilities that will not be used in our business and (v) cost
recoveries for certain restructuring expenses principally with respect to
accelerated depreciation in connection with our co-promotion agreement with
Wyeth (collectively, the "2007 Restructuring Amounts"), charges related to the
Abgenix Acquisition, the Avidia Acquisition, the Immunex Acquisition, the
Alantos Acquisition, the acquisition of Ilypsa, Inc. in July 2007 (the "Ilypsa
Acquisition") and the acquisition of Tularik Inc. in August 2004 (the "Tularik
Acquisition"), the Legal Accruals and amounts associated with severance related
expenses incurred in connection with the Company's acquisition of the remaining
51% ownership interest of Dompe Biotec, S.p.A (the "Dompe Charge"). In addition,
for the twelve months ended December 31, 2007, the Company's adjustments to GAAP
financial measures also relate to amounts associated with the write-off of
inventory principally due to changing regulatory and reimbursement environments
(the "2007 Inventory Charge"), merger related expenses incurred due to the
Abgenix Acquisition primarily related to the incremental costs associated
For the three and twelve months ended December 31, 2007, the Company reported non-GAAP financial results for COS expense, R&D expense, SG&A expense and diluted shares used in the calculation of adjusted earnings per share. COS expense, R&D expense and SG&A expense were adjusted to exclude the effects of expensing stock options in accordance with SFAS No. 123R. Diluted shares used in the calculation of adjusted diluted earnings per share were also adjusted to exclude the effects of adopting SFAS No. 123R. The Company believes that excluding the impact of expensing stock options and the related effects of adopting SFAS No. 123R provides supplemental measures that will facilitate comparisons between periods before and during when such expenses are incurred.
For the three and twelve months ended December 31, 2007, COS expense was also adjusted to exclude the 2007 Restructuring Amounts and for the twelve months ended December 31, 2007, COS expense was also adjusted to exclude the 2007 Inventory Charge, the Abgenix Merger Expense and the Manufacturing Charge. For the three and twelve months ended December 31, 2007, R&D expense was also adjusted to exclude the 2007 Restructuring Amounts, the R&D Technology Intangible Assets' Amortization and the merger related expenses incurred due to the Alantos Acquisition, the Ilypsa Acquisition and the Tularik Acquisition primarily related to incremental costs associated with employee retention (the "2007 Merger Retention Expense"), and for the three and twelve months ended December 31, 2007, SG&A expense was also adjusted to exclude the 2007 Restructuring Amounts and the Dompe Charge. The Company believes that excluding the 2007 Restructuring Amounts, the Abgenix Merger Expense and the 2007 Merger Retention Expense provides supplemental measures that will facilitate comparisons between periods before, during and after such expenses are incurred. The Company believes that excluding the 2007 Inventory Charge, the Manufacturing Charge and the Dompe Charge provides supplemental measures that will facilitate comparisons between periods in which such items did not occur. The Company believes that excluding the R&D Technology Intangible Assets' Amortization treats those assets as if the Company had developed them internally in the past, and thus provides a supplemental measure of profitability in which the Company's acquired intellectual property is treated in a comparable manner to its internally developed intellectual property.
. . .
(c) Exhibits.
99.1 Press Release dated January 26, 2009
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