Tuna, be careful with ELN. Some feel their accounting is very misleading at best and that it is impossible to tell whether they actually made money last year.
Could go to zero or up to $15 easily six months from now? Crapshoot.
Monday July 1, 12:16 pm Eastern Time
Reuters Company News
S&P may cut Elan Corp Plc corporate credit rtg
(Press release provided by Standard & Poor's)
NEW YORK, July 1 - Standard & Poor's said today that it placed its corporate credit rating (triple-B-minus), and all of its other ratings for specialty pharmaceutical company, Elan Corp. PLC, (NYSE:ELN - News) on CreditWatch with negative implications, following Elan's announcement of earlier-than-expected generic competition to one of its top selling products, the pain medication Zanaflex.
"Standard and Poor's will assess the financial implications of the pending loss of Zanaflex sales to generics as well as the implications of previously announced plans to raise R&D expenditures, expand its U.S. and European marketing infrastructures, and pursue further acquisitions, before resolving the CreditWatch," commented Standard & Poor's credit analyst Arthur Wong.
Dublin, Ireland-based Elan already faced near-term challenges in expanding its product sales and the increased likelihood of major debt-financed product acquisitions. The expected generic competition to Zanaflex, which generated $160 million in 2001, is a significant impact on Elan's growth prospects, especially given that Zanaflex was one of the faster growing products in Elan's portfolio.
While Elan continues to maintain a significant net cash position of roughly $1 billion, likely future product acquisitions and/or a year-end 2003 put option on its LYONS issue may result in the company utilizing a significant portion of its cash and investments.
Also, given recent questions surrounding Elan's accounting policies and the resultant SEC investigation, the company's access to debt and equity markets is likely limited.
A complete list of ratings is available to RatingsDirect subscribers at www.ratingsdirect.com, as well as on Standard & Poor's public web site at www.standardandpoors.com under Ratings Actions/Newly Released Ratings. |
