Elan Reports Second Quarter 2004 Financial Results (2004)Full Document 

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Investor Relations:                                       Media Relations:
Emer Reynolds                                             Anita Kawatra
Ph:  353-1-709-4000                                       Ph:  212-407-5755
     800-252-3526                                              800-252-3526

               ELAN REPORTS SECOND QUARTER 2004 FINANCIAL RESULTS


Dublin, Ireland, July 29, 2004 - Elan Corporation, plc (NYSE: ELN) today
announced its second quarter 2004 results and provided a business update.

Commenting on Elan's business, Kelly Martin, Elan's president and chief
executive officer, said, "We continue to focus and align resources against the
commercialisation of Antegren for multiple sclerosis and Crohn's disease,
working with our partner Biogen Idec. Having achieved designation for priority
review and accelerated approval for MS in the U.S. further enhances our focus on
execution and operating discipline. Overall we continue to strengthen our core
therapeutic areas in neurodegenerative diseases, autoimmune, and pain. We
continue to evaluate growth opportunities to enhance our presence in these
specific areas."

Commenting on Elan's second quarter results, Shane Cooke, executive vice
president and chief financial officer, said, "We are pleased to report
continuing positive trends with solid demand for our hospital products and
declining operating costs. The income statement, however, continues to be
impacted by the execution of our plans to reposition the company, streamline the
balance sheet and simplify the capital structure. Of the $118 million net loss
this quarter, $24 million is attributed to the sale of businesses, the ongoing
divestment of the investment portfolio and the fluctuating value of that
portfolio. We maintained a strong liquidity position with $677 million in cash
and an investment portfolio valued at $332 million."






Elan Second Quarter 2004 Financial Results






             Unaudited Consolidated U.S. GAAP Income Statement Data

            Three Months Ended                                                                    Six Months Ended
                  June 30                                                                             June 30
           2003             2004                                                               2003              2004
           US$m             US$m                                                               US$m              US$m
----------------------------------------------------------------------------------------------------------------------
                                                                                                    
                                  Revenue (See page 6)
          183.9             96.5  Product revenue                                             360.9             226.5
           27.9             19.7  Contract revenue                                             70.7              45.2
----------------    -------------                                                        -----------     -------------
          211.8            116.2  Total revenue                                               431.6             271.7
----------------    -------------                                                        -----------     -------------

                                  Operating Expenses (See page 9)
           77.1             44.2  Cost of goods sold                                          149.4              93.9
           71.9             65.0  Research and development                                    151.5             130.4
          114.4             75.3  Selling, general and administrative                         232.0             159.9
        (255.9)           (38.5)  Net gain on divestment of businesses                      (250.3)            (34.8)
          208.6             15.7  Recovery plan and other significant charges                 225.1              21.1
----------------    -------------                                                        -----------     -------------
          216.1            161.7  Total operating expenses                                    507.7             370.5
----------------    -------------                                                        -----------     -------------
          (4.3)           (45.5)  Operating loss                                             (76.1)            (98.8)
----------------    -------------                                                        -----------     -------------

                                  Net Interest and Investment Gains and (Losses) (See
                                    page 11)
         (26.6)           (23.9)  Net interest expense                                       (49.8)            (47.2)
           73.8             12.5  Investment gains                                             73.8              57.3
         (16.4)           (59.7)  Investment losses and other                                (55.9)            (93.8)
----------------    -------------                                                        -----------     -------------
           30.8           (71.1)  Net interest and investment gains and (losses)             (31.9)            (83.7)
----------------    -------------                                                        -----------     -------------

                                  Net income (loss) from continuing operations before
           26.5          (116.6)   tax                                                      (108.0)           (182.5)
          (4.6)            (0.9)  Provision for tax                                           (7.9)             (1.8)
----------------    -------------                                                        -----------     -------------
           21.9          (117.5)  Net income (loss) before discontinued operations          (115.9)           (184.3)
                                  Net income (loss) from discontinued operations (See
          (4.6)            (0.1)    page 15)                                                    5.7               4.5
----------------    -------------                                                        -----------     -------------
           17.3          (117.6)  Net income (loss)                                         (110.2)           (179.8)
================    =============                                                        ===========     =============

                                  Basic and diluted earnings (loss) per ordinary share
          $0.06          ($0.30)    - continuing operations                                 $(0.33)           ($0.47)
                                  Basic and diluted earnings (loss) per ordinary share
        ($0.01)            $0.00    - discontinued operations                                 $0.01             $0.01
                                  Basic and diluted earnings (loss) per ordinary share
          $0.05          ($0.30)    - net income (loss)                                     ($0.32)           ($0.46)
                                  Weighted average number of ordinary shares
          350.0            389.6    outstanding (in millions)                                 349.9             388.2




                                       2


Elan Second Quarter 2004 Financial Results





                Unaudited Non-GAAP Financial Information - EBITDA

            Three Months Ended                   Non-GAAP Financial Information                    Six Months Ended
                  30 June                             Reconciliation Schedule                           30 June
           2003             2004                                                               2003              2004
           US$m             US$m                                                               US$m              US$m
----------------------------------------------------------------------------------------------------------------------
                                  EBITDA
                                                                                                   
          (4.3)           (45.5)  Operating loss                                             (76.1)            (98.8)
                                  Depreciation and amortisation included in
           35.2             31.7   operating loss                                              73.0              64.2
         (17.2)           (16.4)  Amortised fees included in total revenue                   (57.2)            (28.0)
              -              7.0  Milestones received and deferred                                -               7.0
----------------    -------------                                                      -------------     -------------
           13.7           (23.2)  EBITDA                                                     (60.3)            (55.6)
================    =============                                                      =============     =============









           Three Months Ended                   Non-GAAP Financial Information                    Six Months Ended
                 30 June                            Reconciliation Schedule                           30 June
          2003             2004                                                               2003              2004
          US$m             US$m                                                               US$m              US$m
---------------------------------------------------------------------------------------------------------------------
                                                                                                  
                                 EBITDA before net gains on divestment of
                                 businesses, recovery plan and other significant
                                 charges
         (4.3)           (45.5)  Operating loss                                             (76.1)            (98.8)
                                 Depreciation and amortisation included in
          35.2             31.7    operating loss                                             73.0              64.2
        (17.2)           (16.4)  Amortised fees included in total revenue                   (57.2)            (28.0)
             -              7.0  Milestones received and deferred                                -               7.0
       (255.9)           (38.5)  Net gain on divestment of businesses                      (250.3)            (34.8)
         208.6             15.7  Recovery plan and other significant charges                 225.1              21.1
---------------    -------------                                                      -------------     -------------
                                 EBITDA before net gains on divestment of
                                   businesses, recovery plan and other significant
        (33.6)           (46.0)    charges (See page 10)                                    (85.5)            (69.3)
===============    =============                                                      =============     =============

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