What is the main purpose of this 8-K filing?

The main purpose of this 8-K filing is to announce Eli Lilly & Co.'s financial results for the second quarter and first six months of 2005, as well as to provide forward-looking financial guidance for the third quarter and full year 2005. It includes a press release with detailed financial statements.

Why is Eli Lilly & Co. using non-GAAP financial measures?

Eli Lilly & Co. is using non-GAAP financial measures, such as adjusted net income and earnings per share, to provide investors with a clearer view of the company's ongoing operational performance. These measures exclude certain unusual, variable, or non-recurring items that can significantly impact GAAP reported results, allowing for more meaningful period-over-period comparisons and trend identification.

What specific items are excluded in the non-GAAP calculations?

The non-GAAP calculations exclude several items. These include charges related to acquired in-process research and development (like from the Applied Molecular Evolution acquisition), asset impairment charges for manufacturing and R&D, a charge for product liability matters in Q2 2005, and charges from Q4 2004 such as asset impairments, restructuring costs, tax expenses related to overseas earnings repatriation, and in-process R&D from an in-license deal. Additionally, adjustments are made to reflect the adoption of the new accounting standard for share-based payments for comparative purposes.

Does this report provide guidance for future performance?

Yes, the filing indicates that the accompanying press release provides financial expectations for both the third quarter and the full year 2005. Earnings-per-share guidance is provided on both a GAAP basis and on an adjusted basis for growth comparisons.

LLY 8-K: Earnings & Results

Summary

Eli Lilly & Co. (LLY) filed an 8-K on July 21, 2005, to report its financial results for the quarter and six-month period ended June 30, 2005. The filing primarily focuses on providing results of operations and financial condition, including an accompanying press release with detailed financial statements and forward-looking guidance. A significant aspect of this report is Lilly's use of non-GAAP financial measures to offer a clearer year-over-year comparison. These adjusted measures exclude significant items such as charges for acquired in-process R&D, asset impairments, product liability matters, and the impact of adopting new accounting standards for share-based payments. The company believes these non-GAAP metrics provide valuable insights into ongoing operations and operating trends, aiding investors in evaluating performance and making more meaningful period-over-period comparisons. The report also includes financial expectations for the third quarter and full year 2005.

Key Highlights

1Eli Lilly & Co. announced its financial results for the second quarter and six months ended June 30, 2005.
2The company is utilizing non-GAAP financial measures (adjusted net income, adjusted diluted EPS) to provide a clearer year-over-year comparison.
3Key exclusions from non-GAAP measures include charges for acquired in-process R&D, asset impairments, and product liability matters.
4A significant adjustment involves accounting for share-based payments under the new FASB standard adopted January 1, 2005, with pro-forma adjustments to 2004 for comparability.
5The filing includes financial expectations for the third quarter and the full fiscal year 2005.
6The press release providing these results and related financial statements is attached as Exhibit 99.
7The information provided is considered 'furnished' and not 'filed' for the purposes of Section 18 of the Securities Exchange Act of 1934.

ELI LILLY & Co 8-K Report, Financial Results (Jul 21, 2005)

Summary

Key Highlights

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