Eli Lilly Raises Estimate on Charge

Drugmaker Eli Lilly and Co. (LLY) on Wednesday said its restructuring will result in a fourth-quarter charge of 24 cents to 27 cents per share, above its previous estimate of 19 to 24 cents per share.

The Indianapolis-based maker of antidepressant Prozac (search) said in a filing that the estimated charge was increased primarily due to a reconfiguration of its Prince William County, Va., facility.

In a government filing, the company said it expects noncash expenditures to be $360 million to $390 million, consisting of asset impairments. Most relate to manufacturing equipment and facilities in Indiana, North Carolina and Virginia.

Eli Lilly estimated cash expenditures of about $40 million to $75 million for the restructuring — down from its previous estimate of $70 million to $100 million — primarily for severance payments and lease termination payments.

The company said it expects to substantially complete the restructuring actions by March 31, 2005.

On Oct. 14, the company said it would eliminate up to 575 U.S. jobs, or about 2 percent of its U.S. work force. It said it would close 43 leased district and regional sales offices by mid-November.

According to Reuters estimates, the average estimate on Wall Street is for a 74 cent profit for the fourth quarter.

Lilly's shares recovered initial losses and were up 42 cents at $56.23 on the New York Stock Exchange (search).