Eli Lilly 2015 Annual Report Download - page 49

F37
FINANCIAL REPORT
We recognized acquired IPR&D charges of $200.2 million in 2014 resulting from our collaboration
agreements with Adocia, AstraZeneca UK Limited, and Immunocore Limited in addition to charges associated
with the transfer of commercial rights to us, from Boehringer Ingelheim, of the new insulin glargine product in
certain countries where it was not yet approved. There were $57.1 million of acquired IPR&D charges in 2013
related to the acquisition of rights for the CGRP antibody. See Notes 3 and 4 to the consolidated financial
statements for additional information.
We recognized asset impairment, restructuring, and other special charges of $468.7 million in 2014. These
charges included $225.5 million of severance costs and $243.2 million of asset impairment and other special
charges consisting primarily of a $180.8 million asset impairment charge related to our decision to close and
sell a manufacturing plant located in Puerto Rico. In 2013, we recognized asset impairment, restructuring, and
other special charges of $120.6 million. These charges included $30.0 million of asset impairments primarily
associated with the closure of a packaging and distribution facility in Germany and $90.6 million of severance
costs. See Note 5 to the consolidated financial statements for additional information.
Other—net, (income) expense was income of $340.5 million in 2014, compared with income of $518.9 million
in 2013. Other income in 2014 included net gains of $216.4 million on investments and $92.0 million of
income related to the transfer of commercial rights to linagliptin and empagliflozin in certain countries from us
to Boehringer Ingelheim. Other income in 2013 was primarily comprised of $495.4 million related to the
termination of the exenatide collaboration with Amylin. See Notes 4 and 17 to the consolidated financial
statements for additional information.
Our effective tax rate was 20.3 percent in 2014, compared with 20.5 percent in 2013. See Note 13 to the
consolidated financial statements for additional information.
FINANCIAL CONDITION
As of December 31, 2015, cash and cash equivalents was $3.67 billion, a decrease of $205.2 million,
compared with $3.87 billion at December 31, 2014. Refer to the Consolidated Statements of Cash Flows for
additional details on the significant sources and uses of cash for the years ended December 31, 2015 and
December 31, 2014.
In addition to our cash and cash equivalents, we held total investments of $4.43 billion and $5.52 billion as of
December 31, 2015 and December 31, 2014, respectively. See Note 7 to the consolidated financial
statements for additional details.
As of December 31, 2015, total debt was $7.98 billion, a slight decrease of $43.0 million compared with
$8.02 billion at December 31, 2014. This decrease is due primarily to $2.68 billion of net repayments of short-
term commercial paper borrowings, the repayment of $1.78 billion of fixed-rate notes in connection with the
purchase and redemption of certain U.S. dollar-denominated notes in June 2015, and, to a lesser extent, the
decrease in fair value of our hedged debt. These decreases were largely offset by the issuance of $4.45
billion of fixed-rate notes during 2015. At December 31, 2015, we had a total of $1.30 billion of unused
committed bank credit facilities, $1.20 billion of which is available to support our commercial paper program.
See Note 10 to the consolidated financial statements for additional details. We believe that amounts
accessible through existing commercial paper markets should be adequate to fund short-term borrowing
needs.
For the 130th consecutive year, we distributed dividends to our shareholders. Dividends of $2.00 per share
and $1.96 per share were paid in 2015 and 2014, respectively. In the fourth quarter of 2015, effective for the
dividend to be paid in the first quarter of 2016, the quarterly dividend was increased to $0.51 per share,
resulting in an indicated annual rate for 2016 of $2.04 per share.
Capital expenditures of $1.07 billion during 2015 were $96.4 million less than in 2014. We expect 2016 capital
expenditures to be approximately $1.1 billion.
In 2015, we repurchased $749.5 million of shares under the $5.00 billion share repurchase program
previously announced in October 2013.
See "Results of Operations—Executive Overview—Other Matters" section for information regarding the actual
or anticipated effect of losses of exclusivity for Cymbalta (U.S. and Europe), Evista (U.S.), Alimta (U.S.,
Europe, and Japan), and Zyprexa (Japan).