Exhibit 99.1
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| News |
| | |
| | Contacts: |
| | Media: |
| | Sheryl Williams |
| | 610.738.6493 |
| | swilliam@cephalon.com |
| | |
| | Investors: |
| | Robert (Chip) Merritt |
| | 610.738.6376 |
| | cmerritt@cephalon.com |
For immediate release
Cephalon Exceeds both Sales and Earnings Guidance
For Second Quarter of 2008
TREANDA and AMRIX Off to Strong Starts
Cephalon Advances NUVIGIL Launch to 2009
Maintains 2008 Earnings Guidance Despite New Spending for Pre-Launch NUVIGIL Activity and Increased AMRIX Investment
Frazer, Pa. – July 29, 2008 – Cephalon, Inc. (Nasdaq: CEPH) today reported second quarter 2008 sales of $485.0 million, compared to sales of $435.2 million for the second quarter 2007 and the company’s sales guidance of $455 - $465 million. Net income for the quarter was $60.1 million and basic income per common share was $0.89. Excluding amortization expense and certain other items, adjusted net income was $84.5 million and basic adjusted income per common share for the quarter was $1.25, compared to $1.14 for the same period in 2007 and the company’s earnings guidance range of $1.10 to $1.20.
Central nervous system (CNS) franchise sales were $251.2 million during the quarter, a new quarterly record and 9 percent increase compared to the same period last year. Pain franchise reported strong sales of $134.6 million, an increase of 3 percent versus 2007. Oncology franchise sales were $44.1 million, an increase of 86 percent versus 2007, due to robust sales of TREANDA® (bendamustine hydrochloride), which was launched in April and strong European sales of Myocet® (doxorubicin hydrochloride).
SOURCE: Cephalon, Inc. · 41 Moores Road · Frazer, PA 19355 · (610) 344-0200 · Fax (610) 344-0065
“With so many companies suffering from a myriad of economic problems, I am proud that Cephalon is reporting another solid quarter of sales and earnings growth,” said Frank Baldino, Jr., Ph.D., Chairman and CEO. “In particular, it is extremely gratifying to know that patients are benefiting from our recent launches of TREANDA and AMRIX and that both of these unique products are off to great starts. An earlier launch of NUVIGIL and higher spending on AMRIX this year should provide a foundation for even stronger growth in the years ahead.”
The company is updating its guidance for 2008. Total sales guidance is increased by $30 million to $1.86 - $1.91 billion. This includes CNS franchise sales of $975 - $1,000 million, pain franchise sales of $500 - $525 million, oncology franchise sales of $155 - $180 million, and other product sales of $200 - $225 million. Full year SG&A and R&D guidance is $770 - $790 million and $340 - $360 million, respectively, and reflects a $30 million increase in SG&A guidance. Adjusted net income guidance for 2008 is $346 - $353 million and basic adjusted income per common share guidance is $5.10 - $5.20.
For the third quarter of 2008, Cephalon is introducing sales guidance of $480 - $490 million, adjusted net income guidance of $85 - $92 million and basic adjusted income per common share guidance of $1.25 - $1.35.
Basic adjusted income per common share guidance for both the third quarter 2008 and full-year 2008 is reconciled below and is subject to the assumptions set forth therein.
Cephalon’s management will discuss the company’s second quarter 2008 performance in a conference call with investors beginning at 5:00 p.m. U.S. EDT today. To participate in the conference call, dial +1-913-312-9303 and refer to conference code number 6640353. Investors can listen to the call live by logging on to the company’s website at www.cephalon.com and clicking on “Investor Information,” then “Webcast.” The conference call will be archived and available to investors for one week after the call.
About Cephalon, Inc.
Founded in 1987, Cephalon, Inc. is an international biopharmaceutical company dedicated to the discovery, development and commercialization of innovative products in four core therapeutic areas: central nervous system, pain, oncology and addiction. A member of the Fortune 1000, Cephalon currently employs approximately 3,000 people in the United States and Europe. U.S. sites include the company’s headquarters in Frazer, Pennsylvania, and offices, laboratories or manufacturing facilities in West Chester, Pennsylvania, Salt Lake City, Utah, and suburban Minneapolis, Minnesota. The company’s European headquarters are located in Maisons-Alfort, France.
The company’s proprietary products in the United States include: AMRIX® (cyclobenzaprine hydrochloride extended-release capsules), TREANDA, FENTORA® (fentanyl buccal tablet) [C-II], PROVIGIL® (modafinil) Tablets [C-IV], TRISENOX® (arsenic trioxide) injection, VIVITROL® (naltrexone for extended-release injectable suspension), GABITRIL® (tiagabine hydrochloride), NUVIGIL™ (armodafinil) Tablets [C-IV] and ACTIQ® (oral transmucosal fentanyl citrate). The company also
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markets numerous products internationally. Full prescribing information on its U.S. products is available at http://www.cephalon.com or by calling 1-800-896-5855.
In addition to historical facts or statements of current condition, this press release may contain forward-looking statements. Forward-looking statements provide Cephalon’s current expectations or forecasts of future events. These may include statements regarding anticipated scientific progress on its research programs; development of potential pharmaceutical products; interpretation of clinical results; prospects for regulatory approval; manufacturing development and capabilities; market prospects for its products, including the growth and acceptance of Amrix in the market and the relative success of the recent launch of Treanda; sales, adjusted net income and basic adjusted income per common share guidance for the third quarter and full-year 2008 and SG&A and R&D guidance for the full-year 2008; and other statements regarding matters that are not historical facts. You may identify some of these forward-looking statements by the use of words in the statements such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe” or other words and terms of similar meaning. Cephalon’s performance and financial results could differ materially from those reflected in these forward-looking statements due to general financial, economic, regulatory and political conditions affecting the biotechnology and pharmaceutical industries as well as more specific risks and uncertainties facing Cephalon such as those set forth in its reports on Form 8-K, 10-Q and 10-K filed with the U.S. Securities and Exchange Commission. Given these risks and uncertainties, any or all of these forward-looking statements may prove to be incorrect. Therefore, you should not rely on any such factors or forward-looking statements. Furthermore, Cephalon does not intend to update publicly any forward-looking statement, except as required by law. The Private Securities Litigation Reform Act of 1995 permits this discussion.
This press release and/or the financial results attached to this press release include “Adjusted Net Income,” “Basic Adjusted Income per Common Share,” “Adjusted Net Income Guidance,” “Basic Adjusted Income per Common Share Guidance,” and “Diluted Adjusted Income Per Common Share,” amounts that are considered “non-GAAP financial measures” under SEC rules. As required, we have provided reconciliations of these measures. Additional required information is located in the Form 8-K furnished to the SEC in connection with this press release.
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CEPHALON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
| | Three Months Ended
June 30, | | Six Months Ended
June 30, | |
| | 2008 | | 2007 | | 2008 | | 2007 | |
REVENUES: | | | | | | | | | |
Sales | | $ | 485,042 | | $ | 435,194 | | $ | 918,939 | | $ | 859,073 | |
Other revenues | | 7,673 | | 12,018 | | 16,995 | | 25,173 | |
| | 492,715 | | 447,212 | | 935,934 | | 884,246 | |
COSTS AND EXPENSES: | | | | | | | | | |
Cost of sales | | 101,318 | | 83,166 | | 191,234 | | 169,712 | |
Research and development | | 80,409 | | 96,593 | | 161,844 | | 180,551 | |
Selling, general and administrative | | 209,900 | | 189,052 | | 408,884 | | 341,506 | |
Settlement reserve | | — | | 56,000 | | — | | 56,000 | |
Restructuring charges | | 1,565 | | — | | 5,476 | | — | |
In-process research and development | | — | | — | | 10,000 | | — | |
| | 393,192 | | 424,811 | | 777,438 | | 747,769 | |
| | | | | | | | | |
INCOME FROM OPERATIONS | | 99,523 | | 22,401 | | 158,496 | | 136,477 | |
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OTHER INCOME (EXPENSE): | | | | | | | | | |
Interest income | | 4,912 | | 8,041 | | 11,513 | | 14,617 | |
Interest expense | | (7,872 | ) | (5,017 | ) | (16,866 | ) | (9,612 | ) |
Gain on sale of investment | | — | | 5,791 | | — | | 5,791 | |
Other income (expense), net | | (1,543 | ) | (1,502 | ) | 3,772 | | 1,254 | |
| | (4,503 | ) | 7,313 | | (1,581 | ) | 12,050 | |
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INCOME BEFORE INCOME TAXES | | 95,020 | | 29,714 | | 156,915 | | 148,527 | |
| | | | | | | | | |
INCOME TAX EXPENSE | | 34,952 | | 34,022 | | 57,996 | | 77,650 | |
| | | | | | | | | |
NET INCOME (LOSS) | | $ | 60,068 | | $ | (4,308 | ) | $ | 98,919 | | $ | 70,877 | |
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BASIC INCOME (LOSS) PER COMMON SHARE | | $ | 0.89 | | $ | (0.06 | ) | $ | 1.46 | | $ | 1.07 | |
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DILUTED INCOME (LOSS) PER COMMON SHARE | | $ | 0.80 | | $ | (0.06 | ) | $ | 1.33 | | $ | 0.90 | |
| | | | | | | | | |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | | 67,777 | | 66,445 | | 67,721 | | 66,127 | |
| | | | | | | | | |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING-ASSUMING DILUTION | | 74,852 | | 66,445 | | 74,569 | | 78,656 | |
CEPHALON, INC. AND SUBSIDIARIES
Reconciliation of GAAP Net Income to Adjusted Net Income
(Unaudited)
| | Three Months Ended
June 30, | |
| | 2008 | | 2007 | |
| | | | | | | |
GAAP NET INCOME | | $ | 60,068 | | $ | (4,308 | ) |
| | | | | |
Cost of sales adjustments | | 28,892 | (1) | 21,016 | (1) |
Research and development adjustments | | — | | 16,500 | (2) |
Settlement reserve | | — | | 56,000 | (3) |
Gain on sale of investment | | — | | (5,791 | )(4) |
Interest expense adjustment | | 3,750 | (5) | — | |
Restructuring adjustment | | 1,565 | (6) | — | |
Income tax adjustment | | (9,814 | )(7) | (7,784 | )(7) |
| | 24,393 | | 79,941 | |
| | | | | |
ADJUSTED NET INCOME | | $ | 84,461 | | $ | 75,633 | |
| | | | | |
BASIC ADJUSTED INCOME PER COMMON SHARE | | $ | 1.25 | | $ | 1.14 | |
| | | | | |
DILUTED ADJUSTED INCOME PER COMMON SHARE | | $ | 1.13 | | $ | 0.93 | |
| | | | | |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | | 67,777 | | 66,445 | |
| | | | | |
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING-ASSUMING DILUTION | | 74,852 | | 81,209 | |
Notes to Reconciliation of GAAP Net Income to Adjusted Net Income
(1) | To exclude the on-going amortization of acquired intangible assets ($26.8 million in 2008; $21.0 million in 2007), and accelerated depreciation related to restructuring ($2.1 million in 2008). |
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(2) | To exclude charges related to payments for several research and development collaborations. |
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(3) | To exclude the reserve established for the minimum liability related to the potential settlement of the investigations by the U.S. Attorney’s Office. |
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(4) | To exclude the pre-tax gain related to the sale of certain investments. |
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(5) | To exclude an estimate of accrued interest related to the agreement in principle reached with the U.S. Attorney’s Office in Philadelphia. |
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(6) | To exclude costs related to the CIMA Labs restructuring announced in January 2008. |
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(7) | To reflect the tax effect of pre-tax adjustments at the applicable tax rates and certain other tax adjustments primarily related to changes in valuation allowances and other changes in tax assets and liabilities. |
CEPHALON, INC. AND SUBSIDIARIES
Reconciliation of GAAP Net Income to Adjusted Net Income
(Unaudited)
| | Six Months Ended
June 30, | |
| | 2008 | | 2007 | |
| | | | | |
GAAP NET INCOME | | $ | 98,919 | | $ | 70,877 | |
| | | | | |
Cost of sales adjustments | | 56,780 | (1) | 41,981 | (1) |
Research and development adjustments | | 7,754 | (2) | 26,500 | (2) |
Selling, general and administrative adjustments | | 2,955 | (3) | — | |
Settlement reserve | | — | | 56,000 | (4) |
Gain on sale of investment | | — | | (5,791 | )(5) |
Interest expense adjustment | | 7,500 | (6) | — | |
Restructuring adjustment | | 5,476 | (7) | — | |
In-process research and development adjustments | | 10,000 | (8) | — | |
Income tax adjustment | | (29,329 | )(9) | (18,766 | )(9) |
| | 61,136 | | 99,924 | |
| | | | | |
ADJUSTED NET INCOME | | $ | 160,055 | | $ | 170,801 | |
| | | | | |
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BASIC ADJUSTED INCOME PER COMMON SHARE | | $ | 2.36 | | $ | 2.58 | |
| | | | | |
DILUTED ADJUSTED INCOME PER COMMON SHARE | | $ | 2.15 | | $ | 2.17 | |
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WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | | 67,721 | | 66,127 | |
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WEIGHTED AVERAGE NUMBER OF COMMON   SHARES OUTSTANDING-ASSUMING DILUTION | | 74,569 | | 78,656 | |
Notes to Reconciliation of GAAP Net Income to Adjusted Net Income
(1) | To exclude the on-going amortization of acquired intangible assets ($53.0 million in 2008; $42.0 million in 2007), and accelerated depreciation related to restructuring ($3.8 million in 2008). |
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(2) | To exclude charges related to payments for several research and development collaborations, as well as other charges ($1.8 million) related to employee severance costs in 2008. |
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(3) | To exclude charges related to employee severance costs. |
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(4) | To exclude the reserve established for the minimum liability related to the potential settlement of the investigations by the U.S. Attorney’s Office. |
| |
(5) | To exclude the pre-tax gain related to the sale of certain investments. |
| |
(6) | To exclude an estimate of accrued interest related to the agreement in principle reached with U.S. Attorney’s Office in Philadelphia. |
| |
(7) | To exclude costs related to the CIMA Labs restructuring announced in January 2008. |
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(8) | To exclude charges related to the acquisition of licensed technology in the oncology field. |
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(9) | To reflect the tax effect of pre-tax adjustments at the applicable tax rates and certain other tax adjustments primarily related to changes in valuation allowances and other changes in tax assets and liabilities. |
CEPHALON, INC. AND SUBSIDIARIES
CONSOLIDATED SALES DETAIL
(In thousands)
(Unaudited)
| | Three Months Ended
June 30, | | % Increase (Decrease) | |
| | | |
| | 2008 | | 2007 | | |
| | United
States | | Europe | | Total | | United
States | | Europe | | Total | | United
States | | Europe | | Total | |
Sales: | | | | | | | | | | | | | | | | | | | |
PROVIGIL | | $ | 218,942 | | $ | 15,869 | | $ | 234,811 | | $ | 202,465 | | $ | 11,705 | | $ | 214,170 | | 8 | % | 36 | % | 10 | % |
GABITRIL | | 14,307 | | 2,039 | | 16,346 | | 12,978 | | 3,051 | | 16,029 | | 10 | % | (33 | )% | 2 | % |
CNS | | 233,249 | | 17,908 | | 251,157 | | 215,443 | | 14,756 | | 230,199 | | 8 | % | 21 | % | 9 | % |
| | | | | | | | | | | | | | | | | | | |
ACTIQ | | 38,051 | | 14,130 | | 52,181 | | 53,994 | | 10,060 | | 64,054 | | (30 | )% | 40 | % | (19 | )% |
Generic OTFC | | 28,958 | | — | | 28,958 | | 30,853 | | — | | 30,853 | | (6 | )% | — | | (6 | )% |
FENTORA | | 36,374 | | — | | 36,374 | | 36,341 | | — | | 36,341 | | 0 | % | — | | 0 | % |
AMRIX | | 17,119 | | — | | 17,119 | | — | | — | | — | | 100 | % | — | | 100 | % |
Pain | | 120,502 | | 14,130 | | 134,632 | | 121,188 | | 10,060 | | 131,248 | | (1 | )% | 40 | % | 3 | % |
| | | | | | | | | | | | | | | | | | | |
TREANDA | | 14,381 | | — | | 14,381 | | — | | — | | — | | 100 | % | — | | 100 | % |
Other | | 4,380 | | 25,372 | | 29,752 | | 4,752 | | 18,950 | | 23,702 | | (8 | )% | 34 | % | 26 | % |
Oncology | | 18,761 | | 25,372 | | 44,133 | | 4,752 | | 18,950 | | 23,702 | | 295 | % | 34 | % | 86 | % |
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Other | | 13,117 | | 42,003 | | 55,120 | | 12,652 | | 37,393 | | 50,045 | | 4 | % | 12 | % | 10 | % |
| | | | | | | | | | | | | | | | | | | |
| | $ | 385,629 | | $ | 99,413 | | $ | 485,042 | | $ | 354,035 | | $ | 81,159 | | $ | 435,194 | | 9 | % | 22 | % | 11 | % |
| | Six Months Ended
June 30, | | %
Increase
(Decrease) | |
| | | |
| | 2008 | | 2007 | | |
| | United
States | | Europe | | Total | | United
States | | Europe | | Total | | United
States | | Europe | | Total | |
Sales: | | | | | | | | | | | | | | | | | | | |
PROVIGIL | | $ | 417,411 | | $ | 30,635 | | $ | 448,046 | | $ | 391,192 | | $ | 24,267 | | $ | 415,459 | | 7 | % | 26 | % | 8 | % |
GABITRIL | | 25,438 | | 4,332 | | 29,770 | | 26,862 | | 5,387 | | 32,249 | | (5 | )% | (20 | )% | (8 | )% |
CNS | | 442,849 | | 34,967 | | 477,816 | | 418,054 | | 29,654 | | 447,708 | | 6 | % | 18 | % | 7 | % |
| | | | | | | | | | | | | | | | | | | |
ACTIQ | | 75,568 | | 26,333 | | 101,901 | | 111,151 | | 18,631 | | 129,782 | | (32 | )% | 41 | % | (21 | )% |
Generic OTFC | | 56,276 | | — | | 56,276 | | 64,873 | | — | | 64,873 | | (13 | )% | — | | (13 | )% |
FENTORA | | 75,307 | | — | | 75,307 | | 68,031 | | — | | 68,031 | | 11 | % | — | | 11 | % |
AMRIX | | 26,887 | | — | | 26,887 | | — | | — | | — | | 100 | % | — | | 100 | % |
Pain | | 234,038 | | 26,333 | | 260,371 | | 244,055 | | 18,631 | | 262,686 | | (4 | )% | 41 | % | (1 | )% |
| | | | | | | | | | | | | | | | | | | |
TREANDA | | 14,381 | | — | | 14,381 | | — | | — | | — | | 100 | % | — | | 100 | % |
Other | | 9,568 | | 47,642 | | 57,210 | | 8,743 | | 38,240 | | 46,983 | | 9 | % | 25 | % | 22 | % |
Oncology | | 23,949 | | 47,642 | | 71,591 | | 8,743 | | 38,240 | | 46,983 | | 174 | % | 25 | % | 52 | % |
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Other | | 26,644 | | 82,517 | | 109,161 | | 25,833 | | 75,863 | | 101,696 | | 3 | % | 9 | % | 7 | % |
| | | | | | | | | | | | | | | | | | | |
| | $ | 727,480 | | $ | 191,459 | | $ | 918,939 | | $ | 696,685 | | $ | 162,388 | | $ | 859,073 | | 4 | % | 18 | % | 7 | % |
CEPHALON, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)
| | June 30, | | December 31, | |
| | 2008 | | 2007 | |
CURRENT ASSETS: | | | | | |
Cash and cash equivalents | | $ | 673,371 | | $ | 818,669 | |
Investments | | — | | 7,596 | |
Receivables, net | | 338,142 | | 276,776 | |
Inventory, net | | 114,479 | | 99,098 | |
Deferred tax assets, net | | 154,381 | | 176,619 | |
Other current assets | | 47,782 | | 43,267 | |
Total current assets | | 1,328,155 | | 1,422,025 | |
| | | | | |
PROPERTY AND EQUIPMENT, net | | 512,449 | | 500,396 | |
GOODWILL | | 484,029 | | 476,515 | |
INTANGIBLE ASSETS, net | | 793,066 | | 817,828 | |
DEFERRED TAX ASSETS, net | | 176,148 | | 141,752 | |
OTHER ASSETS | | 163,042 | | 147,753 | |
| | $ | 3,456,889 | | $ | 3,506,269 | |
| | | | | |
CURRENT LIABILITIES: | | | | | |
Current portion of long-term debt | | $ | 823,131 | | $ | 1,237,169 | |
Accounts payable | | 82,265 | | 91,437 | |
Accrued expenses | | 677,911 | | 677,184 | |
Total current liabilities | | 1,583,307 | | 2,005,790 | |
| | | | | |
LONG-TERM DEBT | | 202,834 | | 3,788 | |
DEFERRED TAX LIABILITIES, net | | 74,577 | | 56,540 | |
OTHER LIABILITIES | | 137,225 | | 138,084 | |
Total liabilities | | 1,997,943 | | 2,204,202 | |
| | | | | |
STOCKHOLDERS’ EQUITY: | | | | | |
Common stock, $0.01 par value | | 708 | | 700 | |
Additional paid-in capital | | 2,007,582 | | 1,934,965 | |
Treasury stock, at cost | | (194,782 | ) | (158,173 | ) |
Accumulated deficit | | (525,209 | ) | (624,128 | ) |
Accumulated other comprehensive income | | 170,647 | | 148,703 | |
Total stockholders’ equity | | 1,458,946 | | 1,302,067 | |
| | $ | 3,456,889 | | $ | 3,506,269 | |
CEPHALON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
| | Six Months Ended | |
| | June 30, | |
| | 2008 | | 2007 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | | | | | |
Net income | | $ | 98,919 | | $ | 70,877 | |
Adjustments to reconcile net income to net cash provided by operating activities: | | | | | |
Deferred income tax expense (benefit) | | (2,603 | ) | 9,490 | |
Shortfall tax benefits from stock-based compensation | | — | | (198 | ) |
Depreciation and amortization | | 84,006 | | 63,441 | |
Stock-based compensation expense | | 21,894 | | 24,627 | |
Gain on sale of investment | | — | | (5,791 | ) |
Loss on disposals of property and equipment | | 1,031 | | — | |
Other | | (418 | ) | 120 | |
Changes in operating assets and liabilities: | | | | | |
Receivables | | (56,210 | ) | (32,715 | ) |
Inventory | | (7,933 | ) | (26,009 | ) |
Other assets | | (24,027 | ) | (15,945 | ) |
Accounts payable, accrued expenses and deferred revenues | | (10,427 | ) | 14,716 | |
Other liabilities | | 16,418 | | 48,205 | |
Net cash provided by operating activities | | 120,650 | | 150,818 | |
| | | | | |
CASH FLOWS FROM INVESTING ACTIVITIES: | | | | | |
Purchases of property and equipment | | (42,898 | ) | (50,283 | ) |
Acquisition of intangible assets | | (25,575 | ) | — | |
Investment in third party | | (6,242 | ) | — | |
Proceeds from sale of investment in third party | | — | | 12,291 | |
Sales and (purchases) of investments, net | | 7,596 | | 18,040 | |
Net cash used for investing activities | | (67,119 | ) | (19,952 | ) |
| | | | | |
CASH FLOWS FROM FINANCING ACTIVITIES: | | | | | |
Proceeds from exercises of common stock options | | 13,562 | | 66,205 | |
Windfall tax benefits from stock-based compensation | | 480 | | 8,681 | |
Acquisition of treasury stock | | (24 | ) | (128 | ) |
Payments on and retirements of long-term debt | | (215,129 | ) | (1,959 | ) |
Net cash provided by (used for) financing activities | | (201,111 | ) | 72,799 | |
| | | | | |
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS | | 2,282 | | 3,821 | |
| | | | | |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | | (145,298 | ) | 207,486 | |
| | | | | |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | | 818,669 | | 496,512 | |
| | | | | |
CASH AND CASH EQUIVALENTS, END OF PERIOD | | $ | 673,371 | | $ | 703,998 | |
CEPHALON, INC. AND SUBSIDIARIES
Reconciliation of Projected GAAP Basic Income per Common Share
to Basic Adjusted Income Per Common Share Guidance
(Unaudited)
| | Three Months Ended | | Twelve Months Ended | |
| | September 30, 2008 | | December 31, 2008 | |
| | | | | | | | | | | | | |
Projected GAAP basic income per common share | | $ | 0.99 | | — | | $ | 1.09 | | $ | 3.71 | | — | | $ | 3.81 | |
| | | | | | | | | | | | | |
Amortization of current intangibles | | $ | 0.37 | | — | | $ | 0.37 | | $ | 1.53 | | — | | $ | 1.53 | |
Accelerated depreciation adjustment | | $ | 0.02 | | — | | $ | 0.02 | | $ | 0.10 | | — | | $ | 0.10 | |
Research and development adjustments | | $ | — | | — | | $ | — | | $ | 0.11 | | — | | $ | 0.11 | |
Selling, general and administrative adjustments | | $ | — | | — | | $ | — | | $ | 0.04 | | — | | $ | 0.04 | |
In-process research and development adjustments | | $ | — | | — | | $ | — | | $ | 0.15 | | — | | $ | 0.15 | |
Restructuring adjustments | | $ | 0.02 | | — | | $ | 0.02 | | $ | 0.13 | | — | | $ | 0.13 | |
Interest expense adjustment | | $ | — | | — | | $ | — | | $ | 0.11 | | — | | $ | 0.11 | |
| | | | | | | | | | | | | |
Tax effect of pre-tax adjustments at the applicable tax rates | | $ | (0.15 | ) | — | | $ | (0.15 | ) | $ | (0.78 | ) | — | | $ | (0.78 | ) |
| | | | | | | | | | | | | |
Basic adjusted income per common share guidance | | $ | 1.25 | | — | | $ | 1.35 | | $ | 5.10 | | — | | $ | 5.20 | |
The company’s guidance is being issued based on certain assumptions including:
· | | Adjusted effective tax rate of approximately 35.5 to 36.5 percent; and |
| | |
· | | Weighted average number of common shares outstanding of 68.0 and 67.9 million shares for the three months ended September 30, 2008 and for the twelve months ended December 31, 2008, respectively. |
