Stephanie Kessinger Jerry...

Stephanie Kessinger

&

Jerry Moon

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Agenda Company Overview

Operational Overview

Financial Overview

Conclusion

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Company Overview Type of business: Pharmaceutical company

History: Founded in June 1987

Products: Medications to treat HIV/AIDS, Liver Diseases, Oncology, Cardiovascular, and Respiratory Issues

Company Structure: for-profit

Location: Headquarters - Foster City, California

Operations worldwide

Size: 6,000 staff members

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Company Overview Mission: to discover, develop and commercialize

therapeutics that advance patient care, while challenging employees to make a difference and building a thriving worldwide enterprise

Vision: To discover, develop and commercialize innovative therapeutics in the areas of unmet medical need that improve patient care

Core Values: Integrity, Teamwork, accountability, and excellence

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Operational Overview

Pharmaceutical Company

Focus on Anti-viral Medications

Current Competitors

Pfizer and Merck

Often Collaborate with Competition

Major issues of two must recent annual reports

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Financial Strengths

Financial Status: Good- Excellent

Net Income: $2-3 Billion, steady increase

Revenue: $11.2 Billion, steady increase

Stockholders Equity: $11.3 Billion, steady increase

2nd QTR FY14 $4.19 Billion in operating cash flows

2014 Income Statement projected to exceed 2013

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Financial Weaknesses Limited

Debt

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Ratio Analysis & Trends Profitability

Liquidity

Debt

Asset Management & Efficiency

Compare to Merck & Pfizer

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Profitability

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2013 Gilead Pfizer Merck

ROE 27% 28.8% 8.8%

ROA 13.67% 12.78% 4.17%

Total Margin 27.5% 42.7% 10%

Gilead Profitability Trends

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0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

1 2 3

ROE

ROA

Total Margin

2011 2012 2013

Liquidity Ratios

2013 Gilead Pfizer Merck Industry

Current Ratio 2.03 2.41 2.00 1.72

Debt to Capitalization ratio

25.7% 31% 29%

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$0.00

$1,000.00

$2,000.00

$3,000.00

$4,000.00

2011 2012 2013

operatingcash flow

free cash flow

Quick Ratio Trends

0

1

2

3

4

5

6

2011 2012 2013

Gilead

Merck

Pfizer

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Debt Management Ratio Gilead Pfizer Merck

Debt to Equity 0.58 0.48 0.50

Debt Ratio 49% 52% 55%

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$0.00

$2,000.00

$4,000.00

$6,000.00

$8,000.00

2011 2012 2013

currentliabilities

longtermliabilities

Decrease Total Liabilities 7.2% • Increase in current liabilities • Decrease in long term debt

Gilead Debt Management Trends

0

0.2

0.4

0.6

0.8

1

1.2

2011 2012 2013

Debt/Equity

Debt ratio

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Industry Asset Turnover Ratio

0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

2011 2012 2013

Gilead

Merck

Pfizer

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R&D Spending

$0.00

$1,000.00

$2,000.00

$3,000.00

$4,000.00

$5,000.00

$6,000.00

$7,000.00

$8,000.00

$9,000.00

$10,000.00

2011 2012 2013

Gilead

Merck

Pfizer

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Recommendations Expand Research and Development

Pay off debt (long term and current liabilities)

Acquisition Targets

Partnerships

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Gilead Pfizer Merck

Revenues $11 Billion $51.6 Billion

$44 Billion

R&D Spending

$2.11 Billion $6.67 Billion $7.5 Billion

European payment delays

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$0.00

$50,000.00

$100,000.00

$150,000.00

$200,000.00

$250,000.00

$300,000.00

$350,000.00

$400,000.00

$450,000.00

120 days 365 days

Spain

Portugal

Italy

Greece

Total

Ability to pay debt

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References http://finance.yahoo.com/q?s=GILD

http://investors.gilead.com/phoenix.zhtml?c=69964&p=irol-reportsAnnual

Gilead’s annual report and 10K

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