SEC Info - Shire plc - ‘10-K’ for 12/31/09

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Shire plc – ‘10-K’ for 12/31/09 – ‘XML.R32’

On: Friday, 2/26/10, at 12:40pm ET · For: 12/31/09 · Accession #: 950103-10-520 · File #: 0-29630

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 2/26/10  Shire plc                         10-K       12/31/09   62:8.1M                                   Davis Polk & … LLP 01/FA

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K        Annual Report                                       HTML   2.87M 
 2: EX-10.26    Material Contract                                   HTML     37K 
 3: EX-21       Subsidiaries List                                   HTML     47K 
 4: EX-23.1     Consent of Experts or Counsel                       HTML     19K 
 5: EX-23.2     Consent of Experts or Counsel                       HTML     19K 
 6: EX-31.1     Certification -- §302 - SOA'02                      HTML     26K 
 7: EX-31.2     Certification -- §302 - SOA'02                      HTML     26K 
 8: EX-32.1     Certification -- §906 - SOA'02                      HTML     20K 
47: XML         IDEA XML File -- Definitions and References          XML    131K 
55: XML         IDEA XML File -- Filing Summary                      XML     94K 
52: XML.R1      Document And Entity Information                      XML     89K 
53: XML.R2      Consolidated Balance Sheets                          XML    268K 
32: XML.R3      Consolidated Balance Sheets (Parentheticals)         XML     57K 
37: XML.R4      Consolidated Balance Sheets (Parentheticals in       XML     33K 
                GBP)                                                             
45: XML.R5      Consolidated Statements of Operations                XML    365K 
44: XML.R6      Consolidated Statements of Operations                XML     51K 
                (Parentheticals)                                                 
59: XML.R7      Consolidated Statement of Changes in Shareholders'   XML   1.03M 
                Equity                                                           
22: XML.R8      Consolidated Statements of Comprehensive Income      XML    122K 
43: XML.R9      Components of Accumulated Other Comprehensive        XML     51K 
                Income                                                           
20: XML.R10     Consolidated Statements of Comprehensive Income      XML     59K 
                (Parentheticals)                                                 
19: XML.R11     Consolidated Statements of Cash Flows                XML    545K 
31: XML.R12     Description Of Operations                            XML     35K 
49: XML.R13     Summary Of Significant Accounting Policies           XML     80K 
33: XML.R14     Business combinations                                XML     79K 
34: XML.R15     Termination costs                                    XML     38K 
41: XML.R16     Gain on sale of product rights                       XML     35K 
62: XML.R17     Reorganization costs                                 XML     43K 
29: XML.R18     Intergration and Acquisition costs                   XML     35K 
15: XML.R19     Accounts receivable, net                             XML     38K 
36: XML.R20     Inventories                                          XML     37K 
48: XML.R21     Assets held for sale                                 XML     35K 
25: XML.R22     Prepaid expenses and other current assets            XML     37K 
46: XML.R23     Investments                                          XML     40K 
35: XML.R24     Property Plant and Equipment, net                    XML     38K 
58: XML.R25     Goodwill                                             XML     39K 
51: XML.R26     Other intangible assets, net                         XML     43K 
38: XML.R27     Accounts payable and accrued expenses                XML     43K 
42: XML.R28     Other current liabilities                            XML     37K 
18: XML.R29     Long-term debt                                       XML     40K 
21: XML.R30     Other long-term debt                                 XML     36K 
26: XML.R31     Other non-current liabilities                        XML     37K 
30: XML.R32     Derivative instruments                               XML     45K 
40: XML.R33     Fair value measurement                               XML     53K 
50: XML.R34     Commitments and contingencies                        XML     56K 
17: XML.R35     Shareholders Equity                                  XML     41K 
23: XML.R36     Earnings per share                                   XML     52K 
54: XML.R37     Segmental reporting                                  XML     97K 
57: XML.R38     Interest expense                                     XML     36K 
39: XML.R39     Other income (expenses), net                         XML     39K 
60: XML.R40     Retirement benefits                                  XML     34K 
24: XML.R41     Taxation                                             XML     86K 
61: XML.R42     Share-based compensation plans                       XML     71K 
28: XML.R43     Restatement of previously issued financial           XML     35K 
                statements                                                       
16: XML.R44     Income Access Share Trust Financial Statements       XML     62K 
27: XML.R45     Valuation and Qualifying Accounts Schedule           XML     45K 
56: EXCEL       IDEA Workbook of Financial Reports (.xls)            XLS    206K 
 9: EX-101.INS  XBRL Instance -- shpgf-20091231                      XML    826K 
11: EX-101.CAL  XBRL Calculations -- shpgf-20091231_cal              XML    203K 
12: EX-101.DEF  XBRL Definitions -- shpgf-20091231_def               XML     86K 
13: EX-101.LAB  XBRL Labels -- shpgf-20091231_lab                    XML    822K 
14: EX-101.PRE  XBRL Presentations -- shpgf-20091231_pre             XML    468K 
10: EX-101.SCH  XBRL Schema -- shpgf-20091231                        XSD     99K

‘XML.R32’ — Derivative instruments

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<div style="font-size:12pt">21. Derivative instruments Treasury policies and organization The Company’s principal treasury operations are coordinated by its corporate treasury function. All treasury operations are conducted within a framework of policies and procedures approved annually by the Board of Directors. As a matter of policy, the Company does not undertake speculative transactions that would increase its currency or interest rate exposure. Interest rate risk The Company is exposed to interest rate risk on restricted cash, cash and cash equivalents and on foreign exchange contracts on which interest is at floating rates. This exposure is primarily to US dollar, Euro and Canadian dollar interest rates. As the Company maintains all of its investments and foreign exchange contracts on a short term basis for liquidity purposes, this risk is not actively managed. In the year to December 31, 2009 the average interest rate received on cash and liquid investments was less than 1% per annum. The largest proportion of investments was in US dollar money market and liquidity funds. The Company incurs interest at a fixed rate of 2.75% on Shire plc’s $1,100 million in principal amount convertible bonds due 2014. The building financing obligation of $46.7 million is also subject to a fixed interest rate over the lease term on the amount outstanding. No derivative instruments were entered into during the year to December 31, 2009 to manage interest rate exposure. The Company continues to review its interest rate risk and the policies in place to manage the risk. Market risk of investments As at December 31, 2009 the Company has $105.7 million of investments comprising available-for-sale investments in publicly quoted companies ($87.0 million), equity method investments ($14.8 million) and cost method investments in private companies ($3.9 million). The investments in public quoted companies and equity method investments, for certain investment funds which contain a mixed portfolio of public and private investments, are exposed to market risk. No financial instruments or derivatives have been employed to hedge this risk. Credit risk Financial instruments that potentially expose Shire to concentrations of credit risk consist primarily of short-term cash investments, trade accounts receivable (from product sales and from third parties from which the Company receives royalties) and derivative contracts. Cash is invested in short-term money market instruments, including money market and liquidity funds and bank term deposits. The money market and liquidity funds in which Shire invests are all triple A rated by both Standard & Poor’s and by Moody’s credit rating agencies. The Company is exposed to the credit risk of the counterparties with which it enters into derivative contracts. The Company aims to limit this exposure through a system of internal credit limits which require counterparties to have a long term credit rating of A / A2 or better from the major rating agencies. The internal credit limits are approved by the Board of Directors and exposure against these limits is monitored by the corporate treasury function. The counterparties to the derivative contracts are major international financial institutions. The Company’s revenues from product sales are mainly governed by agreements with major pharmaceutical wholesalers and relationships with other pharmaceutical distributors and retail pharmacy chains. For the year to December 31, 2009 there were two customers in the US who accounted for 51% of the Company’s product sales. However, such customers typically have significant cash resources and as such the risk from concentration of credit is considered minimal. The Company has taken positive steps to manage any credit risk associated with these transactions and operates clearly defined credit evaluation procedures. Foreign exchange risk The Company trades in numerous countries and as a consequence has transactional and translational foreign exchange exposure. Transactional exposure arises where transactions occur in currencies different to the functional currency of the relevant subsidiary. The main trading currencies of the Company are the US dollar, the Canadian dollar, Pounds Sterling and the Euro. It is the Company’s policy that these exposures are minimized to the extent practicable by denominating transactions in the subsidiary’s functional currency. Where significant exposures remain, the Company uses foreign exchange contracts (being spot, forward and swap contracts) to manage the exposure in respect of balance sheet assets and liabilities that are denominated in currencies different to the functional currency of the relevant subsidiary. These assets and liabilities relate predominantly to intercompany financing and accruals for royalty receipts. The Company utilizes these derivative instruments to manage currency risk on balance sheet foreign exchange exposures but the foreign exchange contracts have not been designated as hedging instruments. Translational foreign exchange exposure arises on the translation into US dollars of the financial statements of non-US dollar functional subsidiaries. At December 31, 2009 the Company had 26 swap and forward foreign exchange contracts outstanding to manage currency risk. The swaps and forward contracts mature within 90 days. The Company did not have credit risk related contingent features or collateral linked to the derivatives. These foreign exchange contracts were classified in the consolidated balance sheet as follows:<table style="border-collapse: collapse; margin-top: 20px;"><tr><td width="602" align="left" height="17" colspan="2">December 31,</td><td height="17" width="108" align="right">Fair value</td></tr><tr><td height="17" width="75" align="left"> </td><td height="17" width="527" align="left"> </td><td height="17" width="108" align="right">2009 </td></tr><tr><td height="17" width="75" align="left"> </td><td height="17" width="527" align="left"> </td><td height="17" width="108" align="right">$’M</td></tr><tr><td height="14" width="75" align="left"> </td><td height="14" width="527" align="left"> </td><td height="14" width="108" align="right">_____________</td></tr><tr><td height="22" width="75" align="left">Assets</td><td height="22" width="527" align="left">Prepaid expenses and other current assets</td><td height="22" width="108" align="right">5.4 </td></tr><tr><td height="22" width="75" align="left">Liabilities</td><td height="22" width="527" align="left">Other current liabilities</td><td height="22" width="108" align="right">1.2 </td></tr><tr><td height="12" width="75" align="left"> </td><td height="12" width="527" align="left"> </td><td height="12" width="108" align="right">_____________</td></tr></table>Net gains and losses (both realized and unrealized) arising on foreign exchange contracts have been classified in the consolidated statement of operations as follows: <table style="border-collapse: collapse; margin-top: 20px;"><tr><td height="34" width="341" align="left"> </td><td height="34" width="180" align="left">Location of net (loss)/gain recognized in income</td><td height="34" width="106" align="left"> </td><td height="34" width="106" align="right">Amount of net (loss)/gain recognized in income</td></tr><tr><td height="12" width="341" align="left"> </td><td height="12" width="180" align="left">__________________________________</td><td height="12" width="106" align="left"> </td><td height="12" width="106" align="right">__________________________</td></tr><tr><td height="35" width="341" align="left"> </td><td height="35" width="180" align="left"> </td><td height="35" width="106" align="left"> </td><td height="35" width="106" align="right">Year to December 31, </td></tr><tr><td height="17" width="341" align="left"> </td><td height="17" width="180" align="left"> </td><td height="17" width="106" align="left"> </td><td height="17" width="106" align="right">2009 </td></tr><tr><td height="17" width="341" align="left"> </td><td height="17" width="180" align="left"> </td><td height="17" width="106" align="left"> </td><td height="17" width="106" align="right">$’M</td></tr><tr><td height="17" width="341" align="left"> </td><td height="17" width="180" align="left"> </td><td height="17" width="106" align="left"> </td><td height="17" width="106" align="right">_____________</td></tr><tr><td height="17" width="341" align="left">Foreign exchange contracts</td><td height="17" width="180" align="left">Other income/(expense), net</td><td height="17" width="106" align="left"> </td><td height="17" width="106" align="right">(1.4)</td></tr><tr><td height="11" width="341" align="left"> </td><td height="11" width="180" align="left"> </td><td height="11" width="106" align="left"> </td><td height="11" width="106" align="right">_____________</td></tr></table>These net foreign exchange losses are offset within Other income/(expense) by net foreign exchange gains arising on the balance sheet items that these contracts were put in place to manage. </div>

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2 Subsequent Filings that Reference this Filing

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 5/25/10  SEC                               UPLOAD¶     9/11/17    1:21K  Shire plc
 4/14/10  SEC                               UPLOAD¶     9/11/17    1:31K  Shire plc

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Filing Submission 0000950103-10-000520 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Shire plc – ‘10-K’ for 12/31/09 – ‘XML.R32’

On: Friday, 2/26/10, at 12:40pm ET · For: 12/31/09 · Accession #: 950103-10-520 · File #: 0-29630

Previous ‘10-K’: ‘10-K’ on 2/27/09 for 12/31/08 · Next: ‘10-K’ on 2/23/11 for 12/31/10 · Latest: ‘10-K’ on 2/20/18 for 12/31/17 · 2 References: By: SEC – ‘UPLOAD’ on 5/25/10 By: SEC – ‘UPLOAD’ on 4/14/10

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34Filing Table of Contents

‘XML.R32’ — Derivative instruments

This Financial Report is an XBRL XML File.

2 Subsequent Filings that Reference this Filing

Previous ‘10-K’: ‘10-K’ on 2/27/09 for 12/31/08 · Next: ‘10-K’ on 2/23/11 for 12/31/10 · Latest: ‘10-K’ on 2/20/18 for 12/31/17 · 2 References:

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents