Astrazeneca Plc · LSE:AZN
Astrazeneca — Investor Presentation (2004)
14 slides from Astrazeneca's investor presentation, 2004
Slide 1: IAS/IFRS Annual Business Review
IAS/IFRS ANNUAL BUSINESS REVIEW
Slide 2: Introduction
Introduction AstraZeneca one of 7000 companies in EU required to move to report under IAS/IFRS First IFRS results – Q1, 2005 Comparatives are also restated Annual report for 2005 will include two years of IAS/IFRS comparatives Date of IFRS opening balance sheet 1 January 2003 1
Slide 3: Information available
Information available Overview of status of standards, assumptions and most significant effects for AstraZeneca Revised accounting policies Restated financial statements for 2003 & H1 2004 Reconciliations to UK GAAP Audit opinion 2
Slide 4: Standards & EU endorsement
Standards & EU endorsement In July ’03 all existing standards other than IAS32 & IAS39 endorsed by EU Revised standards from improvements project not yet endorsed Original IFRS1 endorsed but later revisions to standard still to be considered by EU IFRS2-IFRS5 issued by IASB, not yet endorsed by EU E
Slide 5: Overview of impact
Overview of impact Full year 2003 % Change UK GAAP IFRS $m $’m Operating profit 4,111 4,007 -2.5 Net profit (after Minority 3,036 3,014 -0.7 Interests) EPS $1.78 $1.76 -1.1 Net Assets 13,257 13,209 -0.4 4
Slide 6: Significant changes in policy
Significant changes in policy Share-based payments Pensions (& similar employee benefits) Goodwill Intangibles Financial instruments Deferred tax 5
Slide 7: Share-based Payments (IFRS2)
Share-based Payments (IFRS2) Accounting policy Fair value charge calculated using the Black-Scholes model Total costs spread over vesting period (3-5 years depending on scheme) Charge adjusted to reflect actual & expected level of vesting Full retrospective application Impact on 2003 Operating profi
Slide 8: Pensions (IAS19)
Pensions (IAS19) Accounting policy (Defined benefit schemes) Separate recognition required of operating & financing costs in income statement Actuarial gains & losses are recognised immediately in the statement of recognised gains and losses* Impact for 2003 Operating profit – charge $14m Net intere
Slide 9: Goodwill (IFRS3)
Goodwill (IFRS3) Accounting policy Goodwill capitalised and subject to impairment review (annual & on indication of impairment) IFRS3 has been applied from 1 January 2003 Impact on 2003 Cessation of goodwill amortisation Operating profit – increase of $59m to SG&A 8
Slide 10: Intangibles (IAS38)
Intangibles (IAS38) Accounting policy Where recognition criteria are met, intangible assets are capitalised and amortised over useful economic lives Impact on 2003 $m Acquisition of product rights 18 Product impairments (7) Internal software development 43 Amortisation (51) Net increase in income 3
Slide 11: Financial Instruments (IAS39)
Financial Instruments (IAS39) Accounting policy Initially recorded at fair value Subsequent measurement depends on designation Impact on 2003 Profit before tax – decrease by $21m 10
Slide 12: Taxation (IAS12)
Taxation (IAS12) Accounting policy Full provision made for temporary differences between taxation and accounting treatment Other impacts Recognition of deferred tax assets and liabilities separately on the balance sheet Change in methodology for DT on profit in stock Impact on 2003 Deferred tax asse
Slide 13: Conclusion
Conclusion 2004 impact Broadly similar IAS39 will have a greater impact than in 2003 Performance measures EPS remains a core short term measure Volatility may be caused by IAS39 Should not adjust EPS to eliminate intangible amortisation 12
Slide 14: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Regarding Forward-Looking Statements In order to utilise the ‘Safe Harbor’ provisions of the United States Private Securities Litigation Reform Act of 1995, AstraZeneca is providing the following cautionary statement. This presentation contains forward-looking statements with re