UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 2, 2016
ALLERGAN PLC
(Exact Name of Registrant as Specified in Charter)
Ireland | 001-36867 | 98-1114402 | ||
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
Clonshaugh Business and Technology Park
Coolock, Dublin, D17 E400, Ireland
(Address of Principal Executive Offices)
(862) 261-7000
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c) |
Item 2.02 | Results of Operations and Financial Condition. |
On November 2, 2016, Allergan plc (the “Company”) issued a press release reporting the financial results for the three and nine months ended September 30, 2016. A copy of the press release reporting the financial results of the Company is attached to this report as Exhibit 99.1 and incorporated herein by reference.
In its press release, the Company discloses items not prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), or non-GAAP financial measures (as defined in Regulation G promulgated by the U.S. Securities and Exchange Commission), that exclude certain significant charges or credits that are important to an understanding of the Company’s ongoing operations. The Company believes that its Non-GAAP measures provide useful information to investors because these are the financial measures used by our management team to evaluate our operating performance, make day to day operating decisions, prepare internal forecasts, communicate external forward looking guidance to investors, compensate management and allocate the Company’s resources. We believe this presentation also increases comparability of period to period results. The Company’s determination of significant charges or credits may not be comparable to similar measures used by other companies and may vary from period to period. The Company uses both GAAP financial measures and the disclosed non-GAAP adjusted financial measures internally. These non-GAAP adjusted financial measures are in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.
Non-GAAP adjusted net income, non-GAAP adjusted net income per share, adjusted EBITDA and non-GAAP adjusted operating income are supplemental measures of our performance that are not required by, or presented in accordance with, GAAP. We define non-GAAP adjusted net income as consolidated net income / (loss) for such period adjusted for the following net of tax: (i) amortization expenses, (ii) global supply chain and operational excellence initiatives, (iii) acquisition, integration and licensing, (iv) accretion on contingent liabilities, (v) impairment/asset sales and related costs, including the exclusion of discontinued operations, (vi) legal settlements and (vii) other unusual charges or expenses. We define adjusted EBITDA as an amount equal to consolidated net income / (loss) from continuing operations attributable to shareholders for such period adjusted for the following: (i) interest expense, (ii) interest income, (iii) (benefit) for income taxes, (iv) depreciation and amortization expenses, (v) stock-based compensation expense, (vi) asset impairment charges and losses / (gains) and expenses associated with the sale of assets, including the exclusion of discontinued operations, (vii) business restructuring charges associated with Allergan’s global supply chain and operational excellence initiatives or other restructurings of a similar nature, (viii) costs and charges associated with the acquisition of businesses and assets including, but not limited to, milestone payments, integration charges, other charges associated with the revaluation of assets or liabilities and charges associated with the revaluation of acquisition related contingent liabilities that are based in whole or in part on future estimated cash flows, (ix) litigation charges and settlements and (x) other unusual charges or expenses. We define non-GAAP adjusted operating income as adjusted EBITDA including depreciation and certain stock-based compensation charges, but excluding dividend income.
The information in this report (including the exhibits) is furnished pursuant to Item 2.02 and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 9.01 | Financial Statements and Exhibits. |
d. | Exhibits: |
99.1 | Press Release of Allergan plc entitled “Allergan Reports Third Quarter 2016 Continuing Operations Performance with GAAP Net Revenues of $3.6 Billion” dated November 2, 2016. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: November 2, 2016 | Allergan plc | ||
By: | /s/ Maria Teresa Hilado | ||
Name: | Maria Teresa Hilado | ||
Title: | Chief Financial Officer |
EXHIBIT INDEX
Exhibit No. |
Description | |
99.1 | Press Release of Allergan plc entitled “Allergan Reports Third Quarter 2016 Continuing Operations Performance with GAAP Net Revenues of $3.6 Billion” dated November 2, 2016. |
Allergan Reports Third Quarter 2016 Continuing Operations Performance with GAAP Net Revenues of $3.6 Billion; Announces Accelerated Share Repurchase, Initiation of Cash Dividend
DUBLIN, Nov. 2, 2016 /PRNewswire/ -- Allergan plc (NYSE: AGN) today reported its third quarter 2016 continuing operations performance.
Logo - http://photos.prnewswire.com/prnh/20150612/222796LOGO
Third Quarter 2016 Continuing Operations
($ in millions, except per share amounts) |
| Q3 '16 |
| Q3 '15 |
| Q2 '16 |
| Q3 '16
|
| Q3 '16
|
|
Total net revenues* |
| $ 3,622.2 |
| $ 3,469.5 |
| $ 3,684.8 |
| 4.4% |
| (1.7)% |
|
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|
|
|
|
|
|
Operating (Loss) |
| $ (266.4) |
| $ (1,377.4) |
| $ (487.6) |
| (80.7)% |
| (45.4)% |
|
Diluted EPS - Continuing Operations |
| $ (1.15) |
| $ (2.40) |
| $ (1.25) |
| (52.1)% |
| (8.0)% |
|
Cash Flow from Operations (including discontinued operations) |
| $ (1,092.4) |
| $ 1,048.2 |
| $ 1,382.5 |
| (204.2)% |
| (179.0)% |
|
SG&A Expense |
| $ 1,157.2 |
| $ 1,022.7 |
| $ 1,210.0 |
| 13.2% |
| (4.4)% |
|
R&D Expense |
| $ 622.8 |
| $ 1,260.5 |
| $ 636.5 |
| (50.6)% |
| (2.2)% |
|
Continuing Operations Tax Rate |
| 29.5% |
| 48.9% |
| 37.9% |
| (19.4)% |
| (8.4)% |
|
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Non-GAAP Adjusted Operating Income |
| $ 1,784.4 |
| $ 1,895.2 |
| $ 1,860.0 |
| (5.8)% |
| (4.1)% |
|
Non-GAAP Adjusted Diluted Net Income Per Share |
| $ 3.32 |
| $ 3.41 |
| $ 3.35 |
| (2.6)% |
| (0.9)% |
|
Non-GAAP Adjusted EBITDA |
| $ 1,902.2 |
| $ 1,987.2 |
| $ 1,936.6 |
| (4.3)% |
| (1.8)% |
|
Non-GAAP SG&A Expense |
| $ 1,006.9 |
| $ 867.3 |
| $ 1,038.8 |
| 16.1% |
| (3.1)% |
|
Non-GAAP R&D Expense |
| $ 386.4 |
| $ 305.0 |
| $ 345.0 |
| 26.7% |
| 12.0% |
|
Non-GAAP Continuing Operations Tax Rate |
| 8.2% |
| 7.7% |
| 7.1% |
| 0.5% |
| 1.1% |
|
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* Excludes the reclassification of revenues of ($23.7) million in Q3 2016, ($43.4) million in Q3 2015, and ($24.4) million in Q2 2016 related to the portion of Allergan product revenues sold by our Anda Distribution Business into discontinued operations. |
Total net revenues of $3.6 billion, a four percent increase versus the prior year quarter, were driven by strong performance from key brands and new product launches, offset by the loss of ASACOL® HD exclusivity, lower revenues for NAMENDA XR®and IR®, a decline in non-promoted Established Brands revenues and unfavorable foreign exchange impact.
"Allergan continues to be among the best positioned biopharmaceutical companies to deliver long-term growth. Our top global products powered our performance in the third quarter, including BOTOX®, RESTASIS®, LINZESS® / CONSTELLA® and Fillers. Our R&D teams continued to deliver exceptional results and build our pipeline with our Open Science R&D approach, including the six new stepping stone acquisitions we announced this quarter. And we substantially added to our share repurchase plan and added a first-ever dividend payable in 2017 to maximize shareholder value," said Brent Saunders, Chairman, CEO and President, Allergan.
"We are focused on finishing 2016 with strong momentum. We are well positioned to leverage our Growth Pharma strategy – deliver strong, durable top-line growth powered by growing franchises; enhance category leadership driven by innovative, high-value treatments; develop new treatments from our Open Science R&D pipeline; enhance our commitment to customer intimacy; and continue to support growth through operational excellence," added Saunders.
"We are also taking bold actions in these turbulent times when healthcare costs are in the spotlight. Through our Social Contract with Patients, we are defining our commitment to balancing investment and innovation with pricing and access, as well as quality and education. We are leading the way with responsible pricing ideals for our branded therapeutic products. This is our commitment to the people who count on us to find new treatments for their most pressing medical needs," said Saunders.
"I want to thank our 16,000 global colleagues who continue to Be Bold. They have remained focused on growing our businesses. They are bringing forward new ideas and approaches to drive our Company. And they are advancing new treatments in each of our therapeutic areas that will have a profound impact on patient care and health," added Saunders.
GAAP operating loss from continuing operations in the third quarter 2016 was $266 million. Non-GAAP adjusted operating income from continuing operations in the third quarter 2016 was $1.78 billion. For the third quarter 2016, Non-GAAP adjusted EBITDA from continuing operations was $1.9 billion, compared to $2.0 billion for the third quarter 2015. The decrease was primarily due to higher research and development and selling and marketing costs. The Company reported negative cash flow from operations of $1.1 billion for the third quarter of 2016 which was unfavorably impacted by the $2.6 billion current period payment of taxes related to the divestiture of Allergan's Generics business to Teva.
Operating Expenses
Total GAAP Selling, General and Administrative (SG&A) Expense was $1.16 billion for the third quarter 2016 compared to $1.02 billion in the prior year period. Total non-GAAP SG&A Expense was $1.0 billion for the third quarter 2016 compared to $867 million in the prior year period due primarily to new product launches and promotion for key products. GAAP Research & Development (R&D) investment for the third quarter 2016 was $623 million. Non-GAAP R&D investment for the third quarter 2016 was $386 million, an increase over prior year due to costs related to key Eye Care and Central Nervous System development programs.
Amortization and Tax
Amortization expense from continuing operations for the third quarter 2016 was $1.6 billion, compared to $1.56 billion in the third quarter of 2015. The Company's GAAP continuing operations tax rate was 29.5 percent in the third quarter 2016. The Company's non-GAAP adjusted continuing operations tax rate was 8.2 percent in the third quarter 2016.
Capital Allocation Update
As of September 30, 2016, Allergan had cash and marketable securities of $27.4 billion and outstanding indebtedness of $32.8 billion. "Post the completion of the Teva transaction in the third quarter of 2016, we have continued to make important progress in our capital allocation strategy to ensure we maintain our Growth Pharma profile and support long-term growth for Allergan shareholders," said Tessa Hilado, Chief Financial Officer, Allergan. "We have completed $5 billion in our initial share repurchase program ahead of schedule, and are ready to go even further to drive shareholder value."
"The Allergan Board of Directors has expanded the share repurchase authorization to $15 billion including authorization of an accelerated share repurchase (ASR) agreement to purchase up to $10 billion of Allergan common stock and the initiation of a quarterly dividend of $0.70 per share beginning in the first quarter of 2017. These actions underscore the conviction we have in the strong future free cash flow generation of the Company, and demonstrate our desire to achieve the right balance between returning significant capital to our shareholders while maintaining our investment-grade credit ratings and preserving sufficient firepower to continue to invest for growth," added Saunders.
Discontinued Operations and Continuing Operations
As a result of the completed divestiture of the Company's Global Generics business to Teva on August 2, 2016, and the completed divestiture of the Company's Anda distribution business to Teva on October 3, 2016, the third quarter 2016 financial results of these businesses are being reported as discontinued operations in the condensed consolidated statements of operations. Included in segment revenues are product sales that were sold by the Anda Distribution business once the Anda Distribution business had sold the product to a third party customer. These sales are included in segment results and are excluded from total continuing operations revenues through a reduction to Corporate revenues. Cost of sales for these products in discontinued operations is equal to our average third-party cost of sales for third-party brand products distributed by Anda Distribution.
Third Quarter 2016 Business Segment Results | ||||
U.S. Specialized Therapeutics | ||||
| ||||
(Unaudited; $ in millions) |
| Three Months Ended September 30, | ||
|
| 2016 (1) |
| 2015 (1) |
|
|
|
|
|
Eye Care |
| $ 608.5 |
| $ 539.9 |
Total Medical Aesthetics |
| 388.9 |
| 340.1 |
Facial Aesthetics |
| 293.7 |
| 249.0 |
Plastic Surgery |
| 52.2 |
| 54.3 |
Skin Care |
| 43.0 |
| 36.8 |
Medical Dermatology |
| 116.1 |
| 107.8 |
Neuroscience & Urology |
| 330.7 |
| 291.4 |
Other Revenues |
| 9.0 |
| 17.4 |
Net revenues |
| $ 1,453.2 |
| $ 1,296.6 |
Operating expenses: |
|
|
|
|
Cost of sales(2) |
| 69.2 |
| 71.6 |
Selling and marketing |
| 292.4 |
| 236.2 |
General and administrative |
| 41.2 |
| 17.2 |
Segment contribution |
| $ 1,050.4 |
| $ 971.6 |
Segment margin |
| 72.3% |
| 74.9% |
Segment gross margin(3) |
| 95.2% |
| 94.5% |
|
|
|
|
|
(1) Includes revenues earned that were distributed through the Anda Distribution business to third party customers. | ||||
(2) Excludes amortization and impairment of acquired intangibles including product rights. |
|
| ||
(3) Defined as net revenues less segment related cost of sales as a percentage of net revenues. |
|
|
U.S. Specialized Therapeutics net revenues grew 12 percent driven by growth in Eye Care, Facial Aesthetics and Neuroscience & Urology.
Eye Care
Medical Aesthetics
Medical Dermatology
Neurosciences & Urology
U.S. Specialized Therapeutics gross margin for the third quarter of 2016 was 95 percent. SG&A expenses in the segment increased 32 percent in the third quarter 2016 primarily due to sales force expansion and increased promotion for key brands, including Kybella® DTC advertising. U.S. Segment contribution for the third quarter 2016 remained strong at $1.1 billion versus the prior year period of $971.6 million.
U.S. General Medicine | ||||
| ||||
(Unaudited; $ in millions) |
| Three Months Ended September 30, | ||
|
| 2016 (1) |
| 2015 (1) |
|
|
|
|
|
Central Nervous System |
| $ 325.5 |
| $ 406.7 |
Gastrointestinal |
| 431.4 |
| 398.6 |
Women's Health |
| 305.3 |
| 268.0 |
Anti-Infectives |
| 52.5 |
| 52.3 |
Established Brands |
| 319.3 |
| 400.5 |
Other Revenues |
| 54.1 |
| 25.9 |
Net revenues |
| $ 1,488.1 |
| $ 1,552.0 |
Operating expenses: |
|
|
|
|
Cost of sales(2) |
| 215.1 |
| 227.5 |
Selling and marketing |
| 292.8 |
| 262.8 |
General and administrative |
| 42.3 |
| 17.5 |
Segment contribution |
| $ 937.9 |
| $ 1,044.2 |
Segment margin |
| 63.0% |
| 67.3% |
Segment gross margin(3) |
| 85.5% |
| 85.3% |
|
|
|
|
|
(1) Includes revenues earned that were distributed through the Anda Distribution business to third party customers. |
|
| ||
(2) Excludes amortization and impairment of acquired intangibles including product rights. |
|
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(3) Defined as net revenues less segment related cost of sales as a percentage of net revenues. |
|
|
U.S. General Medicine net revenues declined 4 percent year over year, impacted by a decline in Central Nervous System and Established Brands revenues, offset primarily by growth in Gastrointestinal and Women's Health performance
Central Nervous System
Gastrointestinal
Women's Health
Anti-Infectives
Established Brands and Other Products
U.S. General Medicine gross margin for the third quarter of 2016 remained stable at 85.5 percent. SG&A expenses in the segment were $335.1 million, up 20 percent in the third quarter 2016 primarily due to new product launches, including VIBERZI® and VRAYLAR™. Segment contribution for the third quarter 2016 was $937.9 million.
International | ||||
| ||||
(Unaudited; $ in millions) | Three Months Ended September 30, |
| ||
| 2016 |
| 2015 |
|
|
|
|
|
|
Eye Care | $ 294.2 |
| $ 281.5 |
|
Total Medical Aesthetics | 251.0 |
| 214.8 |
|
Facial Aesthetics | 212.6 |
| 176.5 |
|
Plastic Surgery | 35.8 |
| 34.6 |
|
Skin Care | 2.6 |
| 3.7 |
|
Botox Therapeutics and Other * | 134.6 |
| 155.5 |
|
Other Revenues | 18.0 |
| 8.8 |
|
Net revenues * | $ 697.8 |
| $ 660.6 |
|
Operating expenses: |
|
|
|
|
Cost of sales(1) | 95.1 |
| 108.3 |
|
Selling and marketing | 188.2 |
| 155.8 |
|
General and administrative | 28.0 |
| 33.3 |
|
Segment contribution | $ 386.5 |
| $ 363.2 |
|
Segment margin | 55.4% |
| 55.0% |
|
Segment gross margin (2) | 86.4% |
| 83.6% |
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(1) Excludes amortization and impairment of acquired intangibles including product rights. |
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| |
(2) Defined as net revenues less segment related cost of sales as a percentage of net revenues. |
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| |
* Includes an adjustment of $31.7 million recorded in the three months ended September 30, 2015 related to International other product revenues for the six months ended June 30, 2015 that were reported in discontinued operations instead of continuing operations during the six months ended June 30, 2015. The impact of this out-of-period adjustment is not material to the six months ended June 30, 2015 or the three months ended September 30, 2015, and had no impact on the nine months ended September 30, 2015. |
International net revenues increased six percent year over year, driven by growth in Facial Aesthetics and Eye Care. Excluding the impact of an out-of-period adjustment in the three months ended September 30, 2015, net revenues would have increased 11 percent.
Eye Care
Medical Aesthetics
Botox Therapeutic & Other Products
International gross margin for the third quarter of 2016 was 86.4 percent. SG&A expenses in the segment were $216.2 million in the third quarter 2016, an increase versus prior year primarily due to new launches. Segment contribution was $386.5 million.
Corporate Function
Included within our corporate function are shared costs, including above site and unallocated costs associated with running our global manufacturing facilities and corporate general and administrative expenses. In addition, our corporate function includes the impact of segment results that are sold through our former Anda Distribution business that are excluded from total continuing operations revenues through a reduction to Corporate revenues and the correlating cost of goods sold impact.
Pipeline Update
Allergan R&D continued to build and deliver on its pipeline in the quarter. Key development highlights included:
U.S. and International Branded Product Approvals and Launches
Regulatory Milestones & Clinical Updates
Updated Full Year 2016 Continuing Operations Guidance1
Allergan's full year 2016 continuing operations standalone estimates are based on management's current belief about prescription trends, pricing levels, inventory levels and the anticipated timing of future product launches and events. Continuing operations includes the U.S. Specialized Therapeutics, U.S. General Medicine and International.
| GAAP | NON-GAAP |
Total Net Revenues | $14.45 billion - $14.65 billion | $14.45 billion - $14.65 billion |
Gross Margin (as a % of revenues) | ~86.5 - 87.5% | ~87 - 88% |
SG&A Expense | ~$4.5 billion | ~$4 billion |
R&D Expense | ~$2.5 billion | ~$1.5 billion |
Net Interest Expense/Other Income | ~$1.05 billion | ~$1.25 billion |
Tax Rate | ~45% | ~8 - 9% |
Earnings / (Loss) Per Share2 | ($3.70 - $3.90) | $13.30 - $13.50 |
Average 2016 Share Count3,4 | ~386 million shares | ~408 million shares |
Average Year-End 2016 Share Count4 | 365 million shares | 365 million shares |
1 Excludes Anda from Net Revenues and expenses. Guidance based on net revenues.
2 GAAP (loss) per share includes the impact of amortization of approximately $6.4 billion, IPR&D impairments and asset sales and impairments, net of $293 million and dividends on preferred shares of approximately $278 million.
3 GAAP EPS shares do not include dilution of shares as earnings are a net loss. As such, the dilution impact of preferred share conversion and outstanding equity awards is not included in the forecasted shares.
4 Includes anticipated impact of $10 billion in Accelerated Share Repurchase (ASR)
Third Quarter 2016 Conference Call and Webcast Details
Allergan will host a conference call and webcast today at 8:30 a.m. Eastern Time to discuss its third quarter 2016 results. The dial-in number to access the call is U.S./Canada (877) 251-7980, International (706) 643-1573, and the conference ID is 96095913. To access the live webcast, go to Allergan's Investor Relations Web site at http://ir.allergan.com.
A taped replay of the conference call will also be available beginning approximately two hours after the call's conclusion and will remain available through 11:30 PM Eastern Time on November 16, 2016. The replay may be accessed by dialing (855) 859-2056 and entering conference ID 96095913. From international locations, the replay may be accessed by dialing (404) 537-3406 and entering the same conference ID. To access the webcast, go to Allergan's Investor Relations Web site at http://ir.allergan.com. A replay of the webcast will also be available.
About Allergan
Allergan plc (NYSE: AGN), headquartered in Dublin, Ireland, is a bold, global biopharmaceutical company and a leader in a new industry model – Growth Pharma. Allergan is focused on developing, manufacturing and commercializing branded pharmaceuticals, devices and biologic products for patients around the world.
Allergan markets a portfolio of leading brands and best-in-class products for the central nervous system, eye care, medical aesthetics and dermatology, gastroenterology, women's health, urology and anti-infective therapeutic categories.
Allergan is an industry leader in Open Science, the Company's R&D model, which defines our approach to identifying and developing game-changing ideas and innovation for better patient care. This approach has led to Allergan building one of the broadest development pipelines in the pharmaceutical industry with 70+ mid-to-late stage pipeline programs in development.
Our Company's success is powered by our more than 16,000 global colleagues' commitment to being Bold for Life. Together, we build bridges, power ideas, act fast and drive results for our customers and patients around the world by always doing what is right.
With commercial operations in approximately 100 countries, Allergan is committed to working with physicians, healthcare providers and patients to deliver innovative and meaningful treatments that help people around the world live longer, healthier lives every day.
For more information, visit Allergan's website at www.Allergan.com.
Website addresses are included only as inactive textual references and are not intended to be active links to such websites. Information contained on such websites or that can be accessed through such websites does not constitute part of this release.
Forward-Looking Statement
Statements contained in this press release that refer to future events or other non-historical facts are forward-looking statements that reflect Allergan's current perspective of existing trends and information as of the date of this release. Except as expressly required by law, Allergan disclaims any intent or obligation to update these forward-looking statements. Actual results may differ materially from Allergan's current expectations depending upon a number of factors affecting Allergan's business. These factors include, among others, the difficulty of predicting the timing or outcome of FDA approvals or actions, if any; the impact of competitive products and pricing; market acceptance of and continued demand for Allergan's products; difficulties or delays in manufacturing; and other risks and uncertainties detailed in Allergan's periodic public filings with the Securities and Exchange Commission, including but not limited to Allergan's Annual Report on Form 10-K for the year ended December 31, 2015 and Quarterly Report on Form 10-Q for the quarter ended June 30, 2016 (certain of such periodic public filings having been filed under the "Actavis plc" name). Except as expressly required by law, Allergan disclaims any intent or obligation to update these forward-looking statements.
This document contains non-GAAP adjusted financial measures. The Appendix hereto presents reconciliations of certain non-GAAP adjusted financial measures to the most directly comparable GAAP measures.
The non-GAAP adjusted measures include non-GAAP adjusted net income, non-GAAP adjusted diluted net income per share, adjusted EBITDA and non-GAAP adjusted operating income.
We believe these non-GAAP measures provide useful information to investors because these are among the measures used by our management team to evaluate our operating performance, make day to day operating decisions, prepare internal forecasts, communicate external forward looking guidance to investors, compensate management and allocate the Company's resources. We believe this presentation also increases comparability of period-to-period results.
Other companies may use similarly titled non GAAP adjusted financial measures that are calculated differently from the way we calculate such measures. Accordingly, our non GAAP adjusted financial measures may not be comparable to similar non-GAAP measures used by other companies. We caution investors not to place undue reliance on such non-GAAP adjusted measures, but instead to consider them with the most directly comparable GAAP measure. Non-GAAP adjusted financial measures have limitations as analytical tools and should not be considered in isolation, or as a substitute for our results as reported under GAAP.
The following table presents Allergan plc's Condensed Consolidated Statement of Operations for the three and nine months ended September 30, 2016 and 2015:
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| Table 1 | |
ALLERGAN PLC | ||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||
(Unaudited; in millions, except per share amounts) | ||||||||||
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| Three Months Ended |
| Nine Months Ended | ||||
|
|
|
| September 30, |
| September 30, | ||||
|
|
|
| 2016 |
| 2015 |
| 2016 |
| 2015 |
Net revenues |
| $ 3,622.2 |
| $ 3,469.5 |
| $ 10,706.3 |
| $ 9,081.2 | ||
|
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| |
Operating expenses: |
|
|
|
|
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|
|
| ||
| Cost of sales (excludes amortization and impairment of acquired intangibles including product
|
| 462.2 |
| 710.3 |
| 1,381.1 |
| 2,150.0 | |
| Research and development |
| 622.8 |
| 1,260.5 |
| 1,662.4 |
| 1,927.9 | |
| Selling, general and administrative |
| 1,157.2 |
| 1,022.7 |
| 3,463.5 |
| 3,205.2 | |
| Amortization |
| 1,609.1 |
| 1,557.8 |
| 4,831.9 |
| 3,858.9 | |
| In-process research and development impairments |
| 42.0 |
| 300.0 |
| 316.9 |
| 497.6 | |
| Asset sales and impairments, net |
| (4.7) |
| (4.4) |
| (24.0) |
| 3.1 | |
|
| Total operating expenses |
| 3,888.6 |
| 4,846.9 |
| 11,631.8 |
| 11,642.7 |
Operating (loss) |
| (266.4) |
| (1,377.4) |
| (925.5) |
| (2,561.5) | ||
|
|
|
|
|
|
|
|
|
|
|
Non-operating income (expense): |
|
|
|
|
|
|
|
| ||
| Interest income |
| 18.1 |
| 3.5 |
| 23.5 |
| 7.6 | |
| Interest (expense) |
| (324.3) |
| (340.2) |
| (1,002.9) |
| (852.0) | |
| Other income (expense), net |
| 33.6 |
| 0.2 |
| 184.2 |
| (238.1) | |
|
| Total other income (expense), net |
| (272.6) |
| (336.5) |
| (795.2) |
| (1,082.5) |
(Loss) before income taxes and noncontrolling interest |
| (539.0) |
| (1,713.9) |
| (1,720.7) |
| (3,644.0) | ||
(Benefit) for income taxes |
| (158.9) |
| (838.9) |
| (825.8) |
| (1,491.0) | ||
Net (loss) from continuing operations, net of tax |
| (380.1) |
| (875.0) |
| (894.9) |
| (2,153.0) | ||
Income from discontinued operations, net of tax |
| 15,601.9 |
| 6,177.6 |
| 15,873.2 |
| 6,701.7 | ||
Net income |
|
| 15,221.8 |
| 5,302.6 |
| 14,978.3 |
| 4,548.7 | |
(Income) attributable to noncontrolling interest |
| (1.8) |
| (1.4) |
| (4.3) |
| (2.6) | ||
Net income attributable to shareholders |
| 15,220.0 |
| 5,301.2 |
| 14,974.0 |
| 4,546.1 | ||
Dividends on preferred shares |
| 69.6 |
| 69.6 |
| 208.8 |
| 162.4 | ||
Net income attributable to ordinary shareholders |
| $ 15,150.4 |
| $ 5,231.6 |
| $ 14,765.2 |
| $ 4,383.7 | ||
|
|
|
|
|
|
|
|
|
|
|
(Loss) / income per share attributable to ordinary shareholders - basic: |
|
|
|
|
|
|
|
| ||
Continuing operations |
| $ (1.15) |
| $ (2.40) |
| $ (2.81) |
| $ (6.46) | ||
Discontinued operations |
| 39.73 |
| 15.69 |
| 40.25 |
| 18.67 | ||
Net income per share - basic |
| $ 38.58 |
| $ 13.29 |
| $ 37.44 |
| $ 12.21 | ||
(Loss) / income per share attributable to ordinary shareholders - diluted: |
|
|
|
|
|
|
|
| ||
Continuing operations |
| $ (1.15) |
| $ (2.40) |
| $ (2.81) |
| $ (6.46) | ||
Discontinued operations |
| 39.73 |
| 15.69 |
| 40.25 |
| 18.67 | ||
Net income per share - diluted |
| $ 38.58 |
| $ 13.29 |
| $ 37.44 |
| $ 12.21 | ||
|
|
|
|
|
|
|
|
| ||
Weighted average shares outstanding: |
|
|
|
|
|
|
|
| ||
Basic |
| 392.7 |
| 393.6 |
| 394.4 |
| 358.9 | ||
Diluted |
| 392.7 |
| 393.6 |
| 394.4 |
| 358.9 |
The following table details Allergan plc's product revenue for significant promoted products globally, within the U.S., and International for the three and nine months ended September 30, 2016 and 2015:
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| Table 2 | |
ALLERGAN PLC | ||||||||||||||||||||
NET REVENUES TOP GLOBAL PRODUCTS | ||||||||||||||||||||
(Unaudited; in millions) | ||||||||||||||||||||
|
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|
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|
|
|
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|
|
|
|
|
|
|
|
|
| Three Months Ended September 30, | |||||||||||||||||||
| Global |
| U.S. |
| International | |||||||||||||||
| 2016 |
| 2015 |
| $ Change | % Change |
| 2016 |
| 2015 |
| $ Change | % Change |
| 2016 |
| 2015 |
| $ Change | % Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Botox® | $ 689.7 |
| $ 604.4 |
| $ 85.3 | 14.1% |
| $ 496.3 |
| $ 435.6 |
| $ 60.7 | 13.9% |
| $ 193.4 |
| $ 168.8 |
| $ 24.6 | 14.6% |
Restasis® | 371.8 |
| 328.3 |
| 43.5 | 13.3% |
| 356.4 |
| 312.8 |
| 43.6 | 13.9% |
| 15.4 |
| 15.5 |
| (0.1) | (0.6)% |
Fillers | 201.8 |
| 167.6 |
| 34.2 | 20.4% |
| 105.0 |
| 89.7 |
| 15.3 | 17.1% |
| 96.8 |
| 77.9 |
| 18.9 | 24.3% |
Namenda XR® | 146.9 |
| 214.5 |
| (67.6) | (31.5)% |
| 146.9 |
| 214.5 |
| (67.6) | (31.5)% |
| - |
| - |
| - | n.a. |
Lumigan®/Ganfort® | 164.9 |
| 157.9 |
| 7.0 | 4.4% |
| 78.3 |
| 71.7 |
| 6.6 | 9.2% |
| 86.6 |
| 86.2 |
| 0.4 | 0.5% |
Bystolic® | 164.4 |
| 155.7 |
| 8.7 | 5.6% |
| 163.9 |
| 155.3 |
| 8.6 | 5.5% |
| 0.5 |
| 0.4 |
| 0.1 | 25.0% |
Linzess®/Constella® | 168.7 |
| 118.6 |
| 50.1 | 42.2% |
| 164.4 |
| 117.5 |
| 46.9 | 39.9% |
| 4.3 |
| 1.1 |
| 3.2 | n.m. |
Alphagan®/Combigan® | 134.7 |
| 120.8 |
| 13.9 | 11.5% |
| 93.4 |
| 81.4 |
| 12.0 | 14.7% |
| 41.3 |
| 39.4 |
| 1.9 | 4.8% |
Asacol®/Delzicol® | 86.4 |
| 157.2 |
| (70.8) | (45.0)% |
| 72.2 |
| 141.9 |
| (69.7) | (49.1)% |
| 14.2 |
| 15.3 |
| (1.1) | (7.2)% |
Lo Loestrin® | 105.7 |
| 90.8 |
| 14.9 | 16.4% |
| 105.7 |
| 89.8 |
| 15.9 | 17.7% |
| - |
| 1.0 |
| (1.0) | (100.0)% |
Viibryd®/Fetzima® | 87.6 |
| 84.5 |
| 3.1 | 3.7% |
| 87.6 |
| 84.5 |
| 3.1 | 3.7% |
| - |
| - |
| - | n.a. |
Estrace® Cream | 98.6 |
| 87.4 |
| 11.2 | 12.8% |
| 98.6 |
| 87.4 |
| 11.2 | 12.8% |
| - |
| - |
| - | n.a. |
Minastrin® 24 | 84.9 |
| 74.4 |
| 10.5 | 14.1% |
| 84.9 |
| 74.4 |
| 10.5 | 14.1% |
| - |
| - |
| - | n.a. |
Breast Implants | 86.7 |
| 85.5 |
| 1.2 | 1.4% |
| 51.1 |
| 50.9 |
| 0.2 | 0.4% |
| 35.6 |
| 34.6 |
| 1.0 | 2.9% |
Carafate ® / Sulcrate ® | 57.0 |
| 52.9 |
| 4.1 | 7.8% |
| 56.4 |
| 52.9 |
| 3.5 | 6.6% |
| 0.6 |
| - |
| 0.6 | n.a. |
Ozurdex ® | 64.3 |
| 51.6 |
| 12.7 | 24.6% |
| 20.9 |
| 17.6 |
| 3.3 | 18.8% |
| 43.4 |
| 34.0 |
| 9.4 | 27.6% |
Aczone® | 69.0 |
| 48.0 |
| 21.0 | 43.8% |
| 69.0 |
| 48.0 |
| 21.0 | 43.8% |
| - |
| - |
| - | n.a. |
Namenda® IR | 2.9 |
| 54.9 |
| (52.0) | (94.7)% |
| 2.9 |
| 54.9 |
| (52.0) | (94.7)% |
| - |
| - |
| - | n.a. |
Other Products Revenues | 859.9 |
| 857.9 |
| 2.0 | 0.2% |
| 694.2 |
| 671.5 |
| 22.7 | 3.4% |
| 165.7 |
| 186.4 |
| (20.7) | (11.1)% |
Less product sold through our
| (23.7) |
| (43.4) |
| 19.7 | (45.4)% |
| (23.7) |
| (43.4) |
| 19.7 | (45.4)% |
| - |
| - |
| - | n.a. |
Total Net Revenues | $ 3,622.2 |
| $ 3,469.5 |
| $ 152.7 | 4.4% |
| $ 2,924.4 |
| $ 2,808.9 |
| $ 115.5 | 4.1% |
| $ 697.8 |
| $ 660.6 |
| $ 37.2 | 5.6% |
|
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|
|
|
|
|
|
|
| Nine Months Ended September 30, | |||||||||||||||||||
| Global |
| U.S. |
| International | |||||||||||||||
| 2016 |
| 2015 |
| $ Change | % Change |
| 2016 |
| 2015 |
| $ Change | % Change |
| 2016 |
| 2015 |
| $ Change | % Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Botox® | $ 2,046.9 |
| $ 1,319.8 |
| $ 727.1 | 55.1% |
| $ 1,454.0 |
| $ 926.4 |
| $ 527.6 | 57.0% |
| $ 592.9 |
| $ 393.4 |
| $ 199.5 | 50.7% |
Restasis® | 1,076.1 |
| 683.2 |
| 392.9 | 57.5% |
| 1,026.4 |
| 651.4 |
| 375.0 | 57.6% |
| 49.7 |
| 31.8 |
| 17.9 | 56.3% |
Fillers | 629.5 |
| 388.2 |
| 241.3 | 62.2% |
| 325.3 |
| 206.7 |
| 118.6 | 57.4% |
| 304.2 |
| 181.5 |
| 122.7 | 67.6% |
Namenda XR® | 486.5 |
| 569.8 |
| (83.3) | (14.6)% |
| 486.5 |
| 569.8 |
| (83.3) | (14.6)% |
| - |
| - |
| - | n.a. |
Lumigan®/Ganfort® | 509.6 |
| 355.6 |
| 154.0 | 43.3% |
| 240.4 |
| 165.9 |
| 74.5 | 44.9% |
| 269.2 |
| 189.7 |
| 79.5 | 41.9% |
Bystolic® | 479.1 |
| 476.9 |
| 2.2 | 0.5% |
| 477.8 |
| 476.1 |
| 1.7 | 0.4% |
| 1.3 |
| 0.8 |
| 0.5 | 62.5% |
Linzess®/Constella® | 464.7 |
| 328.0 |
| 136.7 | 41.7% |
| 452.0 |
| 325.1 |
| 126.9 | 39.0% |
| 12.7 |
| 2.9 |
| 9.8 | n.m. |
Alphagan®/Combigan® | 401.6 |
| 272.3 |
| 129.3 | 47.5% |
| 274.3 |
| 184.9 |
| 89.4 | 48.4% |
| 127.3 |
| 87.4 |
| 39.9 | 45.7% |
Asacol®/Delzicol® | 338.4 |
| 455.6 |
| (117.2) | (25.7)% |
| 297.9 |
| 407.8 |
| (109.9) | (26.9)% |
| 40.5 |
| 47.8 |
| (7.3) | (15.3)% |
Lo Loestrin® | 296.0 |
| 253.3 |
| 42.7 | 16.9% |
| 296.0 |
| 251.7 |
| 44.3 | 17.6% |
| - |
| 1.6 |
| (1.6) | (100.0)% |
Viibryd®/Fetzima® | 252.7 |
| 244.8 |
| 7.9 | 3.2% |
| 252.6 |
| 244.8 |
| 7.8 | 3.2% |
| 0.1 |
| - |
| 0.1 | n.a. |
Estrace® Cream | 276.4 |
| 229.4 |
| 47.0 | 20.5% |
| 276.4 |
| 229.4 |
| 47.0 | 20.5% |
| - |
| - |
| - | n.a. |
Minastrin® 24 | 248.9 |
| 195.9 |
| 53.0 | 27.1% |
| 247.5 |
| 195.3 |
| 52.2 | 26.7% |
| 1.4 |
| 0.6 |
| 0.8 | 133.3% |
Breast Implants | 261.7 |
| 198.4 |
| 63.3 | 31.9% |
| 149.2 |
| 112.8 |
| 36.4 | 32.3% |
| 112.5 |
| 85.6 |
| 26.9 | 31.4% |
Carafate ® / Sulcrate ® | 169.4 |
| 153.4 |
| 16.0 | 10.4% |
| 167.7 |
| 153.4 |
| 14.3 | 9.3% |
| 1.7 |
| - |
| 1.7 | n.a. |
Ozurdex ® | 192.0 |
| 109.6 |
| 82.4 | 75.2% |
| 61.8 |
| 36.9 |
| 24.9 | 67.5% |
| 130.2 |
| 72.7 |
| 57.5 | 79.1% |
Aczone® | 156.1 |
| 114.3 |
| 41.8 | 36.6% |
| 156.1 |
| 114.3 |
| 41.8 | 36.6% |
| - |
| - |
| - | n.a. |
Namenda® IR | 12.8 |
| 532.9 |
| (520.1) | (97.6)% |
| 12.8 |
| 532.9 |
| (520.1) | (97.6)% |
| - |
| - |
| - | n.a. |
Other Products Revenues | 2,487.9 |
| 2,313.6 |
| 174.3 | 7.5% |
| 2,003.5 |
| 1,913.0 |
| 90.5 | 4.7% |
| 484.4 |
| 400.6 |
| 83.8 | 20.9% |
Less product sold through our
| (80.0) |
| (113.8) |
| 33.8 | (29.7)% |
| (80.0) |
| (113.8) |
| 33.8 | (29.7)% |
| - |
| - |
| - | n.a. |
Total Net Revenues | $ 10,706.3 |
| $ 9,081.2 |
| $ 1,625.1 | 17.9% |
| $ 8,578.2 |
| $ 7,584.8 |
| $ 993.4 | 13.1% |
| $ 2,128.1 |
| $ 1,496.4 |
| $ 631.7 | 42.2% |
The following table presents Allergan plc's Condensed Consolidated Balance Sheets as of September 30, 2016 and December 31, 2015:
|
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|
|
| Table 3 |
ALLERGAN PLC | ||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||
(Unaudited; in millions) | ||||||
|
|
|
| September 30, |
| December 31, |
|
|
|
| 2016 |
| 2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
| ||
| Cash and cash equivalents |
| $ 7,554.7 |
| $ 1,096.0 | |
| Marketable securities |
| 19,837.6 |
| 9.3 | |
| Accounts receivable, net |
| 2,398.5 |
| 2,125.4 | |
| Inventories |
| 705.5 |
| 757.5 | |
| Other current assets |
| 771.7 |
| 495.3 | |
| Assets held for sale |
| 663.1 |
| 14,808.9 | |
| Property, plant and equipment, net |
| 1,566.3 |
| 1,531.3 | |
| Investments and other assets |
| 461.8 |
| 458.2 | |
| Product rights and other intangibles, net |
| 63,022.7 |
| 67,836.2 | |
| Goodwill |
| 46,625.8 |
| 46,465.2 | |
|
| Total assets |
| $ 143,607.7 |
| $ 135,583.3 |
|
|
|
|
|
|
|
Liabilities & Equity |
|
|
|
| ||
| Current liabilities |
| $ 6,210.0 |
| $ 4,202.3 | |
| Liabilities held for sale |
| 247.5 |
| 2,228.6 | |
| Current and long-term debt and capital leases |
| 32,770.0 |
| 42,530.4 | |
| Deferred income taxes and other liabilities |
| 14,649.8 |
| 10,032.7 | |
| Total equity |
| 89,730.4 |
| 76,589.3 | |
|
| Total liabilities and equity |
| $ 143,607.7 |
| $ 135,583.3 |
The following table presents Allergan plc's Condensed Consolidated Statements of Cash Flows for the three and nine months ended September 30, 2016 and 2015:
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|
|
| Table 4 | ||
ALLERGAN PLC |
| ||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS |
| ||||||||||||
(Unaudited; in millions) |
| ||||||||||||
|
|
|
|
|
|
| Three Months Ended September 30, |
| Nine Months Ended September 30, | ||||
|
|
|
|
|
|
| 2016 |
| 2015 |
| 2016 |
| 2015 |
Cash Flows From Operating Activities: |
|
|
|
|
|
|
| ||||||
Net income |
|
|
|
|
| $ 15,221.8 |
| $ 5,302.6 |
| $ 14,978.3 |
| $ 4,548.7 | |
Reconciliation to net cash provided by operating activities: |
|
|
|
|
|
|
| ||||||
| Depreciation |
|
|
|
| 40.7 |
| 51.4 |
| 117.6 |
| 183.9 | |
| Amortization |
|
|
|
| 1,609.1 |
| 1,593.9 |
| 4,836.7 |
| 4,192.8 | |
| Provision for inventory reserve | 45.8 |
| 45.2 |
| 162.7 |
| 108.6 | |||||
| Share-based compensation |
| 81.1 |
| 109.8 |
| 269.9 |
| 510.5 | ||||
| Deferred income tax benefit |
| (190.0) |
| (6,882.0) |
| (517.1) |
| (7,470.9) | ||||
| Pre-tax gain sale of generics business | (24,203.1) |
| - |
| (24,203.1) |
| - | |||||
| Non-cash tax effect of gain on sale of generics business | 5,749.9 |
| - |
| 5,749.9 |
| - | |||||
| In-process research and development impairments | 42.0 |
| 300.0 |
| 316.9 |
| 497.6 | |||||
| (Gain) / loss on asset sales and impairments, net | (4.7) |
| (1.2) |
| (24.0) |
| 57.2 | |||||
| Amortization of inventory step up | - |
| 313.7 |
| 42.4 |
| 1,019.8 | |||||
| Amortization of deferred financing costs | 23.6 |
| 8.7 |
| 44.6 |
| 289.2 | |||||
| Contingent consideration adjustments, including accretion | 15.9 |
| 81.1 |
| 76.7 |
| 89.2 | |||||
| Excess tax benefit from stock-based compensation | 5.3 |
| (17.7) |
| (26.6) |
| (54.0) | |||||
| Other, net |
|
|
|
| 10.4 |
| (9.4) |
| (16.0) |
| 54.9 | |
| Changes in assets and liabilities (net of effects of acquisitions): |
|
|
|
|
|
|
| |||||
|
| Decrease / (increase) in accounts receivable, net | 460.8 |
| 532.1 |
| (40.4) |
| (364.0) | ||||
|
| Decrease / (increase) in inventories | (38.4) |
| (35.3) |
| (221.6) |
| (270.1) | ||||
|
| Decrease / (increase) in prepaid expenses and other current assets | (86.5) |
| (86.4) |
| 158.9 |
| (3.3) | ||||
|
| Increase / (decrease) in accounts payable and accrued expenses | (92.1) |
| (399.2) |
| 331.9 |
| (290.6) | ||||
|
| Increase / (decrease) in income and other taxes payable | 346.0 |
| 112.8 |
| (131.6) |
| (103.4) | ||||
|
| Increase / (decrease) in other assets and liabilities | (130.0) |
| 28.1 |
| (397.5) |
| (21.6) | ||||
|
|
| Net cash (used in) / provided by operating activities | (1,092.4) |
| 1,048.2 |
| 1,508.6 |
| 2,974.5 | |||
Cash Flows From Investing Activities: |
|
|
|
|
|
|
| ||||||
Additions to property, plant and equipment | (67.7) |
| (102.5) |
| (250.5) |
| (350.7) | ||||||
Additions to product rights and other intangibles | - |
| (62.6) |
| - |
| (91.1) | ||||||
Sale of generics business |
| 33,304.5 |
| - |
| 33,304.5 |
| - | |||||
Additions to investments |
| (15,445.5) |
| (6.0) |
| (15,445.5) |
| (27.0) | |||||
Proceeds from sale of investments and other assets | 14.5 |
| - |
| 40.0 |
| 855.8 | ||||||
Proceeds from sales of property, plant and equipment | 18.8 |
| 52.1 |
| 33.3 |
| 133.6 | ||||||
Acquisitions of businesses, net of cash acquired | (74.5) |
| (132.8) |
| (74.5) |
| (35,242.7) | ||||||
|
|
| Net cash provided by / (used in) investing activities | 17,750.1 |
| (251.8) |
| 17,607.3 |
| (34,722.1) | |||
Cash Flows From Financing Activities: |
|
|
|
|
|
|
| ||||||
Proceeds from borrowings of long-term indebtedness | - |
| - |
| - |
| 26,456 | ||||||
Proceeds from borrowings on credit facility and other | 150.0 |
| - |
| 1,050.0 |
| 2,882.0 | ||||||
Debt issuance and other financing costs | - |
| - |
| - |
| (310.8) | ||||||
Payments on debt, including capital lease obligations | (6,995.4) |
| (230.5) |
| (10,831.0) |
| (4,326.7) | ||||||
Proceeds from issuance of preferred shares | - |
| - |
| - |
| 4,929.7 | ||||||
Proceeds from issuance of ordinary shares | - |
| - |
| - |
| 4,071.1 | ||||||
Proceeds from stock plans |
| 30.7 |
| 87.6 |
| 138.0 |
| 195.8 | |||||
Payments of contingent consideration | (13.9) |
| (46.3) |
| (77.7) |
| (138.3) | ||||||
Repurchase of ordinary shares |
| (2,691.3) |
| (7.2) |
| (2,758.6) |
| (108.2) | |||||
Dividends |
|
|
|
|
| (69.6) |
| (69.7) |
| (208.8) |
| (138.4) | |
Excess tax benefit from stock-based compensation | (5.3) |
| 17.7 |
| 26.6 |
| 54.0 | ||||||
|
|
| Net cash (used in) / provided by financing activities | (9,594.8) |
| (248.4) |
| (12,661.5) |
| 33,566.6 | |||
Effect of currency exchange rate changes on cash and cash equivalents | 2.3 |
| (2.0) |
| 4.3 |
| (5.1) | ||||||
|
|
| Net increase in cash and cash equivalents | 7,065.2 |
| 546.0 |
| 6,458.7 |
| 1,813.9 | |||
Cash and cash equivalents at beginning of period | 489.5 |
| 1,517.9 |
| 1,096.0 |
| 250.0 | ||||||
Cash and cash equivalents at end of period | $ 7,554.7 |
| $ 2,063.9 |
| $ 7,554.7 |
| $ 2,063.9 | ||||||
Supplemental Disclosures of Cash Flow Information |
|
|
|
|
|
|
| ||||||
Taxes paid in connection with the sale of the generics business | $ 2,571.7 |
| $ - |
| $ 2,571.7 |
| $ - |
We define non-GAAP adjustments to the reported GAAP measures as GAAP results adjusted for the following net of tax: (i) amortization expenses, (ii) global supply chain and operational excellence initiatives, (iii) acquisition, integration and licensing charges, (iv) accretion and fair market value adjustments on contingent liabilities, (v) impairment/asset sales and related costs, including the exclusion of discontinued operations, (vi) legal settlements and (vii) other unusual charges or expenses. The following table presents Allergan plc's GAAP to Non-GAAP adjustments for the three and nine months ended September 30, 2016 and 2015:
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| Table 5 |
ALLERGAN PLC | ||||||||||
GAAP TO NON-GAAP ADJUSTMENTS | ||||||||||
(Unaudited; in millions) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| Three Months Ended September 30, 2016 | |||||||||
| Net Revenue | COGS | Research &
| Selling &
| General &
| Amortization | Asset sales and
| Interest expense,
| Other income
| Income taxes |
GAAP | $ 3,622.2 | $ 462.2 | $ 622.8 | $ 796.0 | $ 361.2 | $ 1,609.1 | $ 37.3 | $ (306.2) | $ 33.6 | $ (158.9) |
|
|
|
|
|
|
|
|
|
|
|
Expenditures incurred with the Pfizer transaction | - | (1.3) | (2.2) | (5.2) | (9.3) | - | - | - | - | - |
Purchase accounting impact on stock-based compensation for acquired awards | - | (1.7) | (8.0) | (16.3) | (12.0) | - | - | - | - | - |
Severance due to integration of acquired entities and other restructuring programs | - | (0.3) | (4.1) | (2.6) | (12.4) | - | - | - | - | - |
Integration charges of acquired businesses | - | (6.4) | (2.9) | 3.7 | (38.5) | - | - | - | - | - |
Brand related milestones and upfront expenses for asset acquisitions |
|
|
|
|
|
|
|
|
|
|
Retrosense | - | - | (59.7) | - | - | - | - | - | - | - |
Arkana | - | - | (48.2) | - | - | - | - | - | - | - |
Merck license agreement | - | - | (100.0) | - | - | - | - | - | - | - |
Accretion and fair-value adjustments to contingent consideration | - | (10.4) | (5.5) | - | - | - | - | - | - | - |
Mark-to-market adjustments for foreign currency option contracts | - | - | - | - | (18.2) | - | - | - | - | - |
Non-cash amortization of debt premium recognized in purchase accounting | - | - | - | - | - | - | - | (10.3) | - | - |
Abandonment of certain R&D projects acquired in the Forest acquisition | - | - | - | - | - | - | (42.0) | - | - | - |
Asset sales and impairments, other | - | - | - | - | - | - | 4.7 | - | - | - |
Litigation settlement related charges | - | - | - | - | (40.8) | - | - | - | - | - |
Other adjustments | - | 0.1 | (5.8) | - | 1.3 | (1,609.1) | - | - | - | - |
Income taxes on pre-tax adjustments | - | - | - | - | - | - | - | - | - | 147.7 |
Discrete income tax events | - | - | - | - | - | - | - | - | - | 134.5 |
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Adjusted | $ 3,622.2 | $ 442.2 | $ 386.4 | $ 775.6 | $ 231.3 | $ - | $ - | $ (316.5) | $ 33.6 | $ 123.3 |
|
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|
|
|
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|
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|
|
|
|
|
|
ALLERGAN PLC | ||||||||||
GAAP TO NON-GAAP ADJUSTMENTS | ||||||||||
(Unaudited; in millions) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| Three Months Ended September 30, 2015 | |||||||||
| Net Revenue | COGS | Research & Development | Selling & Marketing | General & Administrative | Amortization | Asset sales and Impairments, net | Interest expense, net | Other income (expense) | Income taxes |
GAAP | $ 3,469.5 | $ 710.3 | $ 1,260.5 | $ 683.6 | $ 339.1 | $ 1,557.8 | $ 295.6 | $ (336.7) | $ 0.2 | $ (838.9) |
|
|
|
|
|
|
|
|
|
|
|
Impact of selling through purchase accounting mark-up on acquired inventory | - | (292.9) | - | - | - | - | - | - | - | - |
Purchase accounting impact on stock-based compensation for acquired awards | - | (4.3) | (15.4) | (24.6) | (18.6) | - | - | - | - | - |
Severance due to integration of acquired entities and other restructuring programs | - | (0.2) | (3.2) | (7.3) | (7.1) | - | - | - | - | - |
Integration charges of acquired businesses | - | (0.2) | (19.5) | 3.6 | (80.5) | - | - | - | - | - |
Brand related milestones and upfront expenses for asset acquisitions |
|
|
|
|
|
|
|
|
|
|
Naurex | - | - | (571.7) | - | - | - | - | - | - | - |
Darpin | - | - | (35.0) | - | - | - | - | - | - | - |
Merck license agreement | - | - | (250.0) | - | - | - | - | - | - | - |
Other | - | - | (0.6) | - | - | - | - | - | - | - |
Accretion and fair-value adjustments to contingent consideration | - | (20.6) | (60.1) | - | (0.6) | - | - | - | - | - |
Mark-to-market adjustments for foreign currency option contracts | - | - | - | - | (4.5) | - | - | - | - | - |
Non-cash amortization of debt premium recognized in purchase accounting | - | - | - | - | - | - | - | (19.4) | - | - |
Abandonment of certain R&D projects acquired in the Allergan acquisition | - | - | - | - | - | - | (300.0) | - | - | - |
Asset sales and impairments, other | - | - | - | - | - | - | 4.4 | - | - | - |
Litigation settlement related charges | - | - | - | - | (17.5) | - | - | - | - | - |
Other adjustments | (3.7) | - | - | 1.7 | - | (1,557.8) | - | - | (5.0) | - |
Income taxes on pre-tax adjustments | - | - | - | - | - | - | - | - | - | 513.7 |
Discrete income tax events | - | - | - | - | - | - | - | - | - | 443.0 |
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Adjusted | $ 3,465.8 | $ 392.1 | $ 305.0 | $ 657.0 | $ 210.3 | $ - | $ - | $ (356.1) | $ (4.8) | $ 117.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALLERGAN PLC | ||||||||||
GAAP TO NON-GAAP ADJUSTMENTS | ||||||||||
(Unaudited; in millions) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| Nine Months Ended September 30, 2016 | |||||||||
| Net Revenue | COGS | Research & Development | Selling & Marketing | General & Administrative | Amortization | Asset sales and Impairments, net | Interest expense, net | Other income (expense) | Income taxes |
GAAP | $ 10,706.3 | $ 1,381.1 | $ 1,662.4 | $ 2,429.6 | $ 1,033.9 | $ 4,831.9 | $ 292.9 | $ (979.4) | $ 184.2 | $ (825.8) |
|
|
|
|
|
|
|
|
|
|
|
Impact of selling through purchase accounting mark-up on acquired inventory | - | (42.4) | - | - | - | - | - | - | - | - |
Expenditures incurred with the Pfizer transaction | - | (3.5) | (5.7) | (26.2) | (57.5) | - | - | - | (150.0) | - |
Purchase accounting impact on stock-based compensation for acquired awards | - | (6.4) | (31.8) | (55.3) | (35.7) | - | - | - | - | - |
Severance due to integration of acquired entities and other restructuring programs | - | (3.6) | (6.7) | (8.0) | (17.8) | - | - | - | - | - |
Integration charges of acquired businesses | - | (8.9) | 3.4 | (3.7) | (121.5) | - | - | - | - | - |
Brand related milestones and upfront expenses for asset acquisitions |
|
|
|
|
|
|
|
|
|
|
Topokine | - | - | (85.8) | - | - | - | - | - | - | - |
Anterios | - | - | (89.2) | - | - | - | - | - | - | - |
Retrosense | - | - | (59.7) | - | - | - | - | - | - | - |
Arkana | - | - | (48.2) | - | - | - | - | - | - | - |
Merck license agreement | - | - | (100.0) | - | - | - | - | - | - | - |
Heptares | - | - | (125.0) | - | - | - | - | - | - | - |
Other adjustments | - | - | (34.2) | - | - | - | - | - | - | - |
Accretion and fair-value adjustments to contingent consideration | - | (13.4) | (65.8) | - | (0.1) | - | - | - | - | - |
Mark-to-market adjustments for foreign currency option contracts | - | - | - | - | (18.4) | - | - | - | - | - |
Non-cash amortization of debt premium recognized in purchase accounting | - | - | - | - | - | - | - | (40.6) | - | - |
Women's healthcare portfolio product impairment | - | - | - | - | - | - | (24.0) | - | - | - |
Abandonment of certain R&D projects acquired in the Allergan acquisition | - | - | - | - | - | - | (189.9) | - | - | - |
Abandonment of certain R&D projects acquired in the Forest acquisition | - | - | - | - | - | - | (42.0) | - | - | - |
Asset sales and impairments, other | - | - | - | - | - | - | (37.0) | - | - | - |
Litigation settlement related charges | - | - | - | - | (100.0) | - | - | - | - | - |
Other adjustments | - | - | (5.8) | (0.1) | (4.5) | (4,831.9) | - | - | - | - |
Income taxes on pre-tax adjustments | - | - | - | - | - | - | - | - | - | 1,127.8 |
Discrete income tax events | - | - | - | - | - | - | - | - | - | 62.2 |
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Adjusted | $ 10,706.3 | $ 1,302.9 | $ 1,007.9 | $ 2,336.3 | $ 678.4 | $ - | $ - | $ (1,020.0) | $ 34.2 | $ 364.2 |
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|
|
|
|
|
ALLERGAN PLC | ||||||||||
GAAP TO NON-GAAP ADJUSTMENTS | ||||||||||
(Unaudited; in millions) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| Nine Months Ended September 30, 2015 | |||||||||
| Net Revenue | COGS | Research & Development | Selling & Marketing | General & Administrative | Amortization | Asset sales and Impairments, net | Interest expense, net | Other income (expense) | Income taxes |
GAAP | $ 9,081.2 | $ 2,150.0 | $ 1,927.9 | $ 2,017.2 | $ 1,188.0 | $ 3,858.9 | $ 500.7 | $ (844.4) | $ (238.1) | $ (1,491.0) |
|
|
|
|
|
|
|
|
|
|
|
Impact of selling through purchase accounting mark-up on acquired inventory | - | (977.7) | - | - | - | - | - | - | - | - |
Unsalable inventory resulting from the sale of the Company's Respiratory Business | - | (35.3) | - | - | - | - | - | - | - | - |
Purchase accounting impact on stock-based compensation for acquired awards | - | (19.2) | (119.0) | (100.2) | (262.1) | - | - | - | - | - |
Severance due to integration of acquired entities and other restructuring programs | - | (11.5) | (75.3) | (79.6) | (124.7) | - | - | - | - | - |
Integration charges of acquired businesses | - | (2.0) | (23.2) | (0.5) | (241.0) | - | - | - | - | - |
Brand related milestones and upfront expenses for asset acquisitions |
|
|
|
|
|
|
|
|
|
|
Naurex | - | - | (571.7) | - | - | - | - | - | - | - |
Darpin | - | - | (50.0) | - | - | - | - | - | - | - |
Merck license agreement | - | - | (250.0) | - | - | - | - | - | - | - |
Other | - | - | (25.6) | - | - | - | - | - | - | - |
Accretion and fair-value adjustments to contingent consideration | - | (53.1) | (34.7) | - | 0.5 | - | - | - | - | - |
Mark-to-market adjustments for foreign currency option contracts | - | - | - | - | (42.2) | - | - | - | - | - |
Non-cash amortization of debt premium recognized in purchase accounting | - | - | - | - | - | - | - | (50.8) | - | - |
Amortization of bridge loan commitment fees | - | - | - | - | - | - | - | - | 263.0 | - |
Women's healthcare portfolio product impairment | - | - | - | - | - | - | (192.1) | - | - | - |
Abandonment of certain R&D projects acquired in the Allergan acquisition | - | - | - | - | - | - | (300.0) | - | - | - |
Asset sales and impairments, other | - | - | - | - | - | - | (8.6) | - | - | - |
Interest rate lock impact | - | - | - | - | - | - | - | - | (31.0) | - |
Litigation settlement related charges | - | - | - | - | (20.5) | - | - | - | - | - |
Other adjustments | (3.8) | - | 0.3 | 1.7 | (9.6) | (3,858.9) | - | - | 2.3 | - |
Income taxes on pre-tax adjustments | - | - | - | - | - | - | - | - | - | 1,350.3 |
Discrete income tax events | - | - | - | - | - | - | - | - | - | 450.0 |
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Adjusted | $ 9,077.4 | $ 1,051.2 | $ 778.7 | $ 1,838.6 | $ 488.4 | $ - | $ - | $ (895.2) | $ (3.8) | $ 309.3 |
The non-GAAP effective tax rate in the three and nine months ended September 30, 2016 was impacted by income earned in jurisdictions with tax rates lower than the Irish statutory rate partially offset by U.S. income taxed at rates higher than the Irish statutory rate. The non-GAAP effective tax rate in the three months ended September 30, 2016 excludes approximately $135 million of discrete tax benefits related to items including: a change in tax rates applicable to certain temporary differences, a benefit for the New Jersey Grow income tax credit and other non-recurring items. The non-GAAP effective tax rate for the nine months ended September 30, 2016 excludes approximately $60 million of discrete tax benefits related to items including: tax effects of pre-tax impairments, a change in tax rates applicable to certain temporary differences, a benefit for the New Jersey Grow income tax credit, changes in valuation allowances related to the Teva disposition and other non-recurring items.
The following table presents a reconciliation of Allergan plc's reported net (loss) from continuing operations attributable to shareholders and diluted earnings per share to non-GAAP adjusted net income and non-GAAP adjusted diluted net income per share for the three and nine months ended September 30, 2016 and 2015:
|
|
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|
|
| Table 6 |
| ||
ALLERGAN PLC |
| ||||||||
RECONCILIATION TABLE |
| ||||||||
(Unaudited; in millions except per share amounts) |
| ||||||||
|
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|
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|
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|
|
|
| Three Months Ended |
| Nine Months Ended |
| ||||
|
| September 30, |
| September 30, |
| ||||
|
| 2016 |
| 2015 |
| 2016 |
| 2015 |
|
|
|
|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP to Non-GAAP Adjusted net income calculation |
|
|
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|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
| GAAP (loss) from continuing operations attributable to
| $ (381.9) |
| $ (876.4) |
| $ (899.2) |
| $ (2,155.6) |
|
| Adjusted for: |
|
|
|
|
|
|
|
|
| Amortization | 1,609.1 |
| 1,557.8 |
| $ 4,831.9 |
| 3,858.9 |
|
| Acquisition and licensing charges (1) | 321.5 |
| 1,297.7 |
| $ 793.2 |
| 3,155.9 |
|
| Accretion and fair-value adjustments to contingent
| 15.9 |
| 81.3 |
| $ 79.3 |
| 87.3 |
|
| Impairment/asset sales and related costs | 37.3 |
| 295.6 |
| $ 292.9 |
| 500.7 |
|
| Non-recurring (gain) / losses | 18.2 |
| 4.5 |
| $ 18.4 |
| 42.2 |
|
| Legal settlements | 40.8 |
| 17.5 |
| $ 100.0 |
| 20.5 |
|
| Income taxes on items above and other income tax
| (282.2) |
| (956.7) |
| $ (1,190.0) |
| (1,800.3) |
|
| Non-GAAP adjusted net income attributable to
| $ 1,378.7 |
| $ 1,421.3 |
| $ 4,026.5 |
| $ 3,709.6 |
|
|
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|
|
|
|
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|
|
|
Diluted earnings per share |
|
|
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|
|
| |
|
|
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|
|
|
|
|
|
| Diluted (loss) per share from continuing operations attributable
| $ (0.97) |
| $ (2.23) |
| $ (2.28) |
| $ (6.01) |
|
|
|
|
|
|
|
|
|
|
|
| Non-GAAP adjusted diluted earnings per share attributable to
| $ 3.32 |
| $ 3.41 |
| $ 9.66 |
| $ 9.82 |
|
|
|
|
|
|
|
|
|
|
|
| Basic weighted average ordinary shares outstanding | 392.7 |
| 393.6 |
| 394.4 |
| 358.9 |
|
| Effect of dilutive securities: |
|
|
|
|
|
|
|
|
| Dilutive shares | 22.0 |
| 22.7 |
| 22.3 |
| 18.8 |
|
| Diluted weighted average ordinary shares outstanding | 414.7 |
| 416.3 |
| 416.7 |
| 377.7 |
|
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| |||||||||
(1) | Includes stock-based compensation due to the Allergan, Forest and Warner Chilcott
acquisitions as well as the valuation accounting impact
|
We define adjusted EBITDA as an amount equal to consolidated net (loss) from continuing operations attributable to shareholders for such period adjusted for the following: (i) interest expense, (ii) interest income, (iii) (benefit) for income taxes, (iv) depreciation and amortization expenses, (v) stock-based compensation expense, (vi) asset impairment charges and losses / (gains) and expenses associated with the sale of assets, including the exclusion of discontinued operations, (vii) business restructuring charges associated with Allergan's global supply chain and operational excellence initiatives or other restructurings of a similar nature, (viii) costs and charges associated with the acquisition of businesses and assets including, but not limited to, milestone payments, integration charges, other charges associated with the revaluation of assets or liabilities and charges associated with the revaluation of acquisition related contingent liabilities that are based in whole or in part on future estimated cash flows, (ix) litigation charges and settlements and (x) other unusual charges or expenses. We define non-GAAP operating income as adjusted EBITDA including depreciation, certain stock-based compensation charges and excluding dividend income.
The following table presents a reconciliation of Allergan plc's reported net (loss) from continuing operations for the three and nine months ended September 30, 2016 and 2015 to adjusted EBITDA and adjusted operating income:
|
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|
|
| Table 7 | ||
ALLERGAN PLC | |||||||||
ADJUSTED EBITDA and ADJUSTED OPERATING INCOME, RECONCILIATION TABLE | |||||||||
(Unaudited; in millions) | |||||||||
|
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| ||||||
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|
|
| Three Months Ended |
| Nine Months Ended | ||||
|
|
| September 30, |
| September 30, | ||||
|
|
| 2016 |
| 2015 |
| 2016 |
| 2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP (loss) from continuing operations attributable to shareholders |
| $ (381.9) |
| $ (876.4) |
| $ (899.2) |
| $ (2,155.6) | |
Plus: |
|
|
|
|
|
|
|
|
|
| Interest expense |
| 324.3 |
| 340.2 |
| 1,002.9 |
| 852.0 |
| Interest income |
| (18.1) |
| (3.5) |
| (23.5) |
| (7.6) |
| (Benefit) for income taxes |
| (158.9) |
| (838.9) |
| (825.8) |
| (1,491.0) |
| Depreciation (includes accelerated depreciation) |
| 40.7 |
| 37.9 |
| 114.5 |
| 96.0 |
| Amortization |
| 1,609.1 |
| 1,557.8 |
| 4,831.9 |
| 3,858.9 |
EBITDA |
| $ 1,415.2 |
| $ 217.1 |
| $ 4,200.8 |
| $ 1,152.7 | |
Adjusted for: |
|
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|
|
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|
| |
| Acquisition and licensing and other charges |
| 293.8 |
| 1,254.2 |
| 704.6 |
| 2,706.2 |
| Impairment/asset sales and related costs |
| 37.3 |
| 295.6 |
| 292.9 |
| 500.7 |
| Non-recurring (gain) / losses |
| 18.2 |
| 4.5 |
| 18.4 |
| 42.2 |
| Legal settlements |
| 40.8 |
| 17.5 |
| 100.0 |
| 20.5 |
| Accretion and fair-value adjustments to contingent consideration |
| 15.9 |
| 81.3 |
| 79.3 |
| 87.3 |
| Share-based compensation |
| 81.0 |
| 117.0 |
| 257.0 |
| 625.3 |
Adjusted EBITDA |
| $ 1,902.2 |
| $ 1,987.2 |
| $ 5,653.0 |
| $ 5,134.9 | |
Adjusted for: |
|
|
|
|
|
|
|
| |
| Depreciation |
| (40.7) |
| (37.9) |
| (114.5) |
| (96.0) |
| Dividend income |
| (34.1) |
| - |
| (34.1) |
| - |
| Share-based compensation restructuring charges and purchase accounting impact on stock-based compensation for acquired awards |
| (43.0) |
| (54.1) |
| (127.8) |
| (124.8) |
Adjusted Operating Income |
| $ 1,784.4 |
| $ 1,895.2 |
| $ 5,376.6 |
| $ 4,914.1 | |
|
|
|
|
|
|
|
|
|
|
The following table details Allergan plc's product revenue for significant promoted products within the US Specialized Therapeutic Segment for the three and nine months ended September 30, 2016 and 2015:
|
|
|
|
|
| Table 8 | ||
ALLERGAN PLC | ||||||||
US Specialized Therapeutics Product Revenue | ||||||||
(Unaudited; in millions) | ||||||||
|
|
|
|
|
|
| ||
|
| Three Months Ended September 30, |
| Change | ||||
|
| 2016 (1) |
| 2015 (1) |
| Dollars |
| % |
|
|
|
|
|
|
|
|
|
Total Eye Care |
| $ 608.5 |
| $ 539.9 |
| $ 68.6 |
| 12.7% |
Restasis® |
| 356.4 |
| 312.8 |
| 43.6 |
| 13.9% |
Lumigan®/Ganfort® |
| 78.3 |
| 71.7 |
| 6.6 |
| 9.2% |
Alphagan®/Combigan® |
| 93.4 |
| 81.4 |
| 12.0 |
| 14.7% |
Ozurdex® |
| 20.9 |
| 17.6 |
| 3.3 |
| 18.8% |
Eye Drops |
| 50.2 |
| 45.3 |
| 4.9 |
| 10.8% |
Other Eye Care |
| 9.3 |
| 11.1 |
| (1.8) |
| (16.2)% |
Total Medical Aesthetics |
| 388.9 |
| 340.1 |
| 48.8 |
| 14.3% |
Facial Aesthetics |
| 293.7 |
| 249.0 |
| 44.7 |
| 18.0% |
Botox® Cosmetics |
| 174.5 |
| 159.3 |
| 15.2 |
| 9.5% |
Fillers |
| 105.0 |
| 89.7 |
| 15.3 |
| 17.1% |
Kybella® |
| 14.2 |
| - |
| 14.2 |
| n.a. |
Plastic Surgery |
| 52.2 |
| 54.3 |
| (2.1) |
| (3.9)% |
Breast Implants |
| 51.1 |
| 50.9 |
| 0.2 |
| 0.4% |
Other Plastic Surgery |
| 1.1 |
| 3.4 |
| (2.3) |
| (67.6)% |
Skin Care |
| 43.0 |
| 36.8 |
| 6.2 |
| 16.8% |
SkinMedica® |
| 25.8 |
| 23.0 |
| 2.8 |
| 12.2% |
Latisse® |
| 17.2 |
| 13.8 |
| 3.4 |
| 24.6% |
Total Medical Dermatology |
| 116.1 |
| 107.8 |
| 8.3 |
| 7.7% |
Aczone® |
| 69.0 |
| 48.0 |
| 21.0 |
| 43.8% |
Tazorac® |
| 27.5 |
| 27.6 |
| (0.1) |
| (0.4)% |
Botox® Hyperhidrosis |
| 16.3 |
| 15.0 |
| 1.3 |
| 8.7% |
Other Medical Dermatology |
| 3.3 |
| 17.2 |
| (13.9) |
| (80.8)% |
Total Neuroscience & Urology |
| 330.7 |
| 291.4 |
| 39.3 |
| 13.5% |
Botox® Therapeutics |
| 305.5 |
| 261.3 |
| 44.2 |
| 16.9% |
Rapaflo® |
| 25.2 |
| 30.1 |
| (4.9) |
| (16.3)% |
Other Revenues |
| 9.0 |
| 17.4 |
| (8.4) |
| (48.3)% |
Net revenues |
| $ 1,453.2 |
| $ 1,296.6 |
| $ 156.6 |
| 12.1% |
|
|
|
|
|
|
|
|
|
(1) Includes revenues earned that were distributed through the Anda Distribution business to third party customers. |
|
|
|
|
| |||
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
| Nine Months Ended September 30, |
| Change | ||||
|
| 2016 (1) |
| 2015 (1) |
| Dollars |
| % |
|
|
|
|
|
|
|
|
|
Total Eye Care |
| $ 1,777.6 |
| $ 1,213.2 |
| $ 564.4 |
| 46.5% |
Restasis® |
| 1,026.4 |
| 651.4 |
| 375.0 |
| 57.6% |
Lumigan®/Ganfort® |
| 240.4 |
| 165.9 |
| 74.5 |
| 44.9% |
Alphagan®/Combigan® |
| 274.3 |
| 184.9 |
| 89.4 |
| 48.4% |
Ozurdex® |
| 61.8 |
| 36.9 |
| 24.9 |
| 67.5% |
Eye Drops |
| 140.1 |
| 131.8 |
| 8.3 |
| 6.3% |
Other Eye Care |
| 34.6 |
| 42.3 |
| (7.7) |
| (18.2)% |
Total Medical Aesthetics |
| 1,182.6 |
| 761.4 |
| 421.2 |
| 55.3% |
Facial Aesthetics |
| 893.3 |
| 547.9 |
| 345.4 |
| 63.0% |
Botox® Cosmetics |
| 529.8 |
| 341.2 |
| 188.6 |
| 55.3% |
Fillers |
| 325.3 |
| 206.7 |
| 118.6 |
| 57.4% |
Kybella® |
| 38.2 |
| - |
| 38.2 |
| n.a. |
Plastic Surgery |
| 153.1 |
| 122.5 |
| 30.6 |
| 25.0% |
Breast Implants |
| 149.2 |
| 112.8 |
| 36.4 |
| 32.3% |
Other Plastic Surgery |
| 3.9 |
| 9.7 |
| (5.8) |
| (59.8)% |
Skin Care |
| 136.2 |
| 91.0 |
| 45.2 |
| 49.7% |
SkinMedica® |
| 81.5 |
| 51.6 |
| 29.9 |
| 57.9% |
Latisse® |
| 54.7 |
| 39.4 |
| 15.3 |
| 38.8% |
Total Medical Dermatology |
| 282.2 |
| 249.4 |
| 32.8 |
| 13.2% |
Aczone® |
| 156.1 |
| 114.3 |
| 41.8 |
| 36.6% |
Tazorac® |
| 68.0 |
| 65.7 |
| 2.3 |
| 3.5% |
Botox® Hyperhidrosis |
| 48.9 |
| 35.5 |
| 13.4 |
| 37.7% |
Other Medical Dermatology |
| 9.2 |
| 33.9 |
| (24.7) |
| (72.9)% |
Total Neuroscience & Urology |
| 963.8 |
| 637.2 |
| 326.6 |
| 51.3% |
Botox® Therapeutics |
| 875.3 |
| 549.7 |
| 325.6 |
| 59.2% |
Rapaflo® |
| 87.6 |
| 87.5 |
| 0.1 |
| 0.1% |
Other Neuroscience & Urology |
| 0.9 |
| - |
| 0.9 |
| n.a. |
Other Revenues |
| 34.6 |
| 28.4 |
| 6.2 |
| 21.8% |
Net revenues |
| $ 4,240.8 |
| $ 2,889.6 |
| $ 1,351.2 |
| 46.8% |
|
|
|
|
|
|
|
|
|
(1) Includes revenues earned that were distributed through the Anda Distribution business to third party customers. |
|
|
|
|
|
The following table details Allergan plc's product revenue for significant promoted products within the US General Medicine Segment for the three and nine months ended September 30, 2016 and 2015:
|
|
|
|
|
| Table 9 | ||
|
|
|
|
|
|
|
|
|
ALLERGAN PLC | ||||||||
US General Medicine Product Revenue | ||||||||
(Unaudited; in millions) | ||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
| Three Months Ended September 30, |
| Change | ||||
|
| 2016 (1) |
| 2015 (1) |
| Dollars |
| % |
|
|
|
|
|
|
|
|
|
Total Central Nervous System (CNS) |
| $ 325.5 |
| $ 406.7 |
| (81.2) |
| (20.0)% |
Namenda XR® |
| 146.9 |
| 214.5 |
| (67.6) |
| (31.5)% |
Namzaric® |
| 14.9 |
| 1.7 |
| 13.2 |
| n.m. |
Viibryd®/Fetzima® |
| 87.6 |
| 84.5 |
| 3.1 |
| 3.7% |
Vraylar™ |
| 32.4 |
| - |
| 32.4 |
| n.a. |
Saphris® |
| 40.8 |
| 51.1 |
| (10.3) |
| (20.2)% |
Namenda® IR |
| 2.9 |
| 54.9 |
| (52.0) |
| (94.7)% |
Total Gastrointestinal (GI) |
| 431.4 |
| 398.6 |
| 32.8 |
| 8.2% |
Linzess® |
| 164.4 |
| 117.5 |
| 46.9 |
| 39.9% |
Viberzi® |
| 30.9 |
| - |
| 30.9 |
| n.a. |
Asacol®/Delzicol® |
| 72.2 |
| 141.9 |
| (69.7) |
| (49.1)% |
Carafate®/Sulcrate® |
| 56.4 |
| 52.9 |
| 3.5 |
| 6.6% |
Canasa®/Salofalk® |
| 47.2 |
| 34.6 |
| 12.6 |
| 36.4% |
Zenpep® |
| 52.5 |
| 43.1 |
| 9.4 |
| 21.8% |
Other GI |
| 7.8 |
| 8.6 |
| (0.8) |
| (9.3)% |
Total Women's Health |
| 305.3 |
| 268.0 |
| 37.3 |
| 13.9% |
Lo Loestrin® |
| 105.7 |
| 89.8 |
| 15.9 |
| 17.7% |
Minastrin® 24 |
| 84.9 |
| 74.4 |
| 10.5 |
| 14.1% |
Estrace® Cream |
| 98.6 |
| 87.4 |
| 11.2 |
| 12.8% |
Liletta® |
| 4.4 |
| 5.8 |
| (1.4) |
| (24.1)% |
Other Women's Health |
| 11.7 |
| 10.6 |
| 1.1 |
| 10.4% |
Total Anti-Infectives |
| 52.5 |
| 52.3 |
| 0.2 |
| 0.4% |
Teflaro® |
| 33.3 |
| 35.8 |
| (2.5) |
| (7.0)% |
Avycaz® |
| 4.8 |
| 7.5 |
| (2.7) |
| (36.0)% |
Dalvance® |
| 10.3 |
| 4.9 |
| 5.4 |
| 110.2% |
Other Anti-Infectives |
| 4.1 |
| 4.1 |
| - |
| 0.0% |
Established Brands |
| 319.3 |
| 400.5 |
| (81.2) |
| (20.3)% |
Bystolic® |
| 163.9 |
| 155.3 |
| 8.6 |
| 5.5% |
Armour Thyroid |
| 39.1 |
| 34.7 |
| 4.4 |
| 12.7% |
Enablex® |
| 1.9 |
| 17.2 |
| (15.3) |
| (89.0)% |
Lexapro® |
| 15.6 |
| 17.8 |
| (2.2) |
| (12.4)% |
Savella® |
| 28.1 |
| 29.0 |
| (0.9) |
| (3.1)% |
PacPharma |
| 6.2 |
| 27.4 |
| (21.2) |
| (77.4)% |
Other Established Brands |
| 64.5 |
| 119.1 |
| (54.6) |
| (45.8)% |
Other Revenues |
| 54.1 |
| 25.9 |
| 28.2 |
| 108.9% |
Net revenues |
| $ 1,488.1 |
| $ 1,552.0 |
| $ (63.9) |
| (4.1)% |
|
|
|
|
|
|
|
|
|
(1) Includes revenues earned that were distributed through the Anda Distribution business to third party customers.
|
|
|
|
|
| |||
|
|
|
|
|
|
| ||
|
| Nine Months Ended September 30, |
| Change | ||||
|
| 2016 (1) |
| 2015 (1) |
| Dollars |
| % |
|
|
|
|
|
|
|
|
|
Total Central Nervous System (CNS) |
| $ 964.6 |
| $ 1,485.1 |
| (520.5) |
| (35.0)% |
Namenda XR® |
| 486.5 |
| 569.8 |
| (83.3) |
| (14.6)% |
Namzaric® |
| 38.0 |
| 3.3 |
| 34.7 |
| n.m. |
Viibryd®/Fetzima® |
| 252.6 |
| 244.8 |
| 7.8 |
| 3.2% |
Vraylar™ |
| 51.1 |
| - |
| 51.1 |
| n.a. |
Saphris® |
| 123.6 |
| 134.3 |
| (10.7) |
| (8.0)% |
Namenda® IR |
| 12.8 |
| 532.9 |
| (520.1) |
| (97.6)% |
Total Gastrointestinal (GI) |
| 1,277.0 |
| 1,138.4 |
| 138.6 |
| 12.2% |
Linzess® |
| 452.0 |
| 325.1 |
| 126.9 |
| 39.0% |
Viberzi® |
| 55.3 |
| - |
| 55.3 |
| n.a. |
Asacol®/Delzicol® |
| 297.9 |
| 407.8 |
| (109.9) |
| (26.9)% |
Carafate®/Sulcrate® |
| 167.7 |
| 153.4 |
| 14.3 |
| 9.3% |
Canasa®/Salofalk® |
| 135.0 |
| 102.2 |
| 32.8 |
| 32.1% |
Zenpep® |
| 145.1 |
| 121.5 |
| 23.6 |
| 19.4% |
Other GI |
| 24.0 |
| 28.4 |
| (4.4) |
| (15.5)% |
Total Women's Health |
| 865.1 |
| 716.7 |
| 148.4 |
| 20.7% |
Lo Loestrin® |
| 296.0 |
| 251.7 |
| 44.3 |
| 17.6% |
Minastrin® 24 |
| 247.5 |
| 195.3 |
| 52.2 |
| 26.7% |
Estrace® Cream |
| 276.4 |
| 229.4 |
| 47.0 |
| 20.5% |
Liletta® |
| 15.0 |
| 10.7 |
| 4.3 |
| 40.2% |
Other Women's Health |
| 30.2 |
| 29.6 |
| 0.6 |
| 2.0% |
Total Anti-Infectives |
| 167.1 |
| 138.3 |
| 28.8 |
| 20.8% |
Teflaro® |
| 101.9 |
| 105.3 |
| (3.4) |
| (3.2)% |
Avycaz® |
| 26.9 |
| 12.9 |
| 14.0 |
| 108.5% |
Dalvance® |
| 26.7 |
| 11.3 |
| 15.4 |
| 136.3% |
Other Anti-Infectives |
| 11.6 |
| 8.8 |
| 2.8 |
| 31.8% |
Established Brands |
| 1,038.8 |
| 1,267.7 |
| (228.9) |
| (18.1)% |
Bystolic® |
| 477.8 |
| 476.1 |
| 1.7 |
| 0.4% |
Armour Thyroid |
| 121.8 |
| 88.9 |
| 32.9 |
| 37.0% |
Enablex® |
| 14.7 |
| 51.5 |
| (36.8) |
| (71.5)% |
Lexapro® |
| 50.8 |
| 53.6 |
| (2.8) |
| (5.2)% |
Savella® |
| 74.1 |
| 80.6 |
| (6.5) |
| (8.1)% |
PacPharma |
| 49.7 |
| 56.6 |
| (6.9) |
| (12.2)% |
Other Established Brands |
| 249.9 |
| 460.4 |
| (210.5) |
| (45.7)% |
Other Revenues |
| 78.3 |
| 57.5 |
| 20.8 |
| 36.2% |
Net revenues |
| $ 4,390.9 |
| $ 4,803.7 |
| $ (412.8) |
| (8.6)% |
|
|
|
|
|
|
|
|
|
(1) Includes revenues earned that were distributed through the Anda Distribution business to third party customers. |
|
|
|
|
|
The following table details Allergan plc's product revenue for significant promoted products within the International Segment for the three and nine months ended September 30, 2016 and 2015:
|
|
|
|
|
| Table 10 | ||
|
|
|
|
|
|
|
|
|
ALLERGAN PLC | ||||||||
International Product Revenue | ||||||||
(Unaudited; in millions) | ||||||||
|
|
|
|
|
|
|
|
|
|
| Three Months Ended September 30, |
| Change | ||||
|
| 2016 |
| 2015 |
| Dollars |
| % |
|
|
|
|
|
|
|
|
|
Total Eye Care |
| $ 294.2 |
| $ 281.5 |
| $ 12.7 |
| 4.5% |
Lumigan®/Ganfort® |
| 86.6 |
| 86.2 |
| 0.4 |
| 0.5% |
Alphagan®/Combigan® |
| 41.3 |
| 39.4 |
| 1.9 |
| 4.8% |
Ozurdex® |
| 43.4 |
| 34.0 |
| 9.4 |
| 27.6% |
Optive® |
| 25.6 |
| 23.2 |
| 2.4 |
| 10.3% |
Other Eye Drops |
| 42.1 |
| 44.0 |
| (1.9) |
| (4.3)% |
Restasis® |
| 15.4 |
| 15.5 |
| (0.1) |
| (0.6)% |
Other Eye Care |
| 39.8 |
| 39.2 |
| 0.6 |
| 1.5% |
Total Medical Aesthetics |
| 251.0 |
| 214.8 |
| 36.2 |
| 16.9% |
Facial Aesthetics |
| 212.6 |
| 176.5 |
| 36.1 |
| 20.5% |
Botox® Cosmetics |
| 115.3 |
| 98.6 |
| 16.7 |
| 16.9% |
Fillers |
| 96.8 |
| 77.9 |
| 18.9 |
| 24.3% |
Belkyra® (Kybella®) |
| 0.5 |
| - |
| 0.5 |
| n.a. |
Plastic Surgery |
| 35.8 |
| 34.6 |
| 1.2 |
| 3.5% |
Breast Implants |
| 35.6 |
| 34.6 |
| 1.0 |
| 2.9% |
Earfold™ |
| 0.2 |
| - |
| 0.2 |
| n.a. |
Skin Care |
| 2.6 |
| 3.7 |
| (1.1) |
| (29.7)% |
Botox® Therapeutics and Other |
| 134.6 |
| 155.5 |
| (20.9) |
| (13.4)% |
Botox® Therapeutics |
| 78.1 |
| 70.2 |
| 7.9 |
| 11.3% |
Asacol®/Delzicol® |
| 14.2 |
| 15.3 |
| (1.1) |
| (7.2)% |
Constella® |
| 4.3 |
| 1.1 |
| 3.2 |
| n.m. |
Other Products** |
| 38.0 |
| 68.9 |
| (30.9) |
| (44.8)% |
Other Revenues |
| 18.0 |
| 8.8 |
| 9.2 |
| 104.5% |
Net revenues ** |
| $ 697.8 |
| $ 660.6 |
| $ 37.2 |
| 5.6% |
|
|
|
|
|
|
|
|
|
** | Includes an adjustment of $31.7 million recorded in the three months ended September 30, 2015 related to international other product revenues for the six months ended June 30, 2015 that were reported in discontinued operations instead of continuing operations during the six months ended June 30, 2015. The impact of this out-of-period adjustment is not material to the six months ended June 30, 2015 or the three months ended September 30, 2015 and has no impact on the nine months ended September 30, 2015. Excluding this adjustment, international revenues would have increased 12% on a performance basis. | |||||||
|
|
|
|
|
|
| ||
|
| Nine Months Ended September 30, |
| Change | ||||
|
| 2016 |
| 2015 |
| Dollars |
| % |
|
|
|
|
|
|
|
|
|
Total Eye Care |
| $ 904.4 |
| $ 623.7 |
| $ 280.7 |
| 45.0% |
Lumigan®/Ganfort® |
| 269.2 |
| 189.7 |
| 79.5 |
| 41.9% |
Alphagan®/Combigan® |
| 127.3 |
| 87.4 |
| 39.9 |
| 45.7% |
Ozurdex® |
| 130.2 |
| 72.7 |
| 57.5 |
| 79.1% |
Optive® |
| 75.7 |
| 51.9 |
| 23.8 |
| 45.9% |
Other Eye Drops |
| 131.2 |
| 99.5 |
| 31.7 |
| 31.9% |
Restasis® |
| 49.7 |
| 31.8 |
| 17.9 |
| 56.3% |
Other Eye Care |
| 121.1 |
| 90.7 |
| 30.4 |
| 33.5% |
Total Medical Aesthetics |
| 780.0 |
| 509.9 |
| 270.1 |
| 53.0% |
Facial Aesthetics |
| 658.7 |
| 416.4 |
| 242.3 |
| 58.2% |
Botox® Cosmetics |
| 352.9 |
| 234.9 |
| 118.0 |
| 50.2% |
Fillers |
| 304.2 |
| 181.5 |
| 122.7 |
| 67.6% |
Belkyra® (Kybella®) |
| 1.6 |
| - |
| 1.6 |
| n.a. |
Plastic Surgery |
| 112.9 |
| 85.6 |
| 27.3 |
| 31.9% |
Breast Implants |
| 112.5 |
| 85.6 |
| 26.9 |
| 31.4% |
Earfold™ |
| 0.4 |
| - |
| 0.4 |
| n.a. |
Skin Care |
| 8.4 |
| 7.9 |
| 0.5 |
| 6.3% |
Botox® Therapeutics and Other |
| 399.0 |
| 321.5 |
| 77.5 |
| 24.1% |
Botox® Therapeutics |
| 240.0 |
| 158.5 |
| 81.5 |
| 51.4% |
Asacol®/Delzicol® |
| 40.5 |
| 47.8 |
| (7.3) |
| (15.3)% |
Constella® |
| 12.7 |
| 2.9 |
| 9.8 |
| n.m. |
Other Products |
| 105.8 |
| 112.3 |
| (6.5) |
| (5.8)% |
Other Revenues |
| 44.7 |
| 41.3 |
| 3.4 |
| 8.2% |
Net revenues |
| $ 2,128.1 |
| $ 1,496.4 |
| $ 631.7 |
| 42.2% |
The following table provides a reconciliation of anticipated GAAP loss from continuing operations to non-GAAP adjusted net income attributable to shareholders for the year ending December 31, 2016:
Table 11 | ||||
| ||||
$ in millions | LOW |
| HIGH | |
| GAAP (loss) from continuing operations attributable to shareholders | $ (1,225.0) |
| $ (1,150.0) |
| Adjusted for: |
|
|
|
| Amortization | 6,440.0 |
| 6,440.0 |
| Acquisition and licensing charges | 1,175.0 |
| 1,225.0 |
| Accretion and fair-value adjustments to contingent consideration | 85.0 |
| 95.0 |
| Impairment/asset sales and related costs | 292.9 |
| 292.9 |
| Non-recurring (gain) / losses | 18.4 |
| 18.4 |
| Legal settlements | 100.0 |
| 100.0 |
| Income taxes on items above and other income tax adjustments | (1,461.3) |
| (1,511.3) |
| Non-GAAP adjusted net income attributable to
| $ 5,425.0 |
| $ 5,510.0 |
|
|
|
|
|
Diluted earnings per share |
|
|
| |
|
|
|
|
|
| Diluted (loss) per share from continuing operations attributable to shareholders- GAAP | $ (3.17) |
| $ (2.98) |
|
|
|
|
|
| Non-GAAP adjusted diluted net income per share attributable to shareholders | $ 13.30 |
| $ 13.50 |
|
|
|
|
|
| Basic weighted average ordinary shares outstanding | 386.0 |
| 386.0 |
| Effect of dilutive securities: |
|
|
|
| Dilutive shares | 22.0 |
| 22.0 |
| Diluted weighted average ordinary shares outstanding | 408.0 |
| 408.0 |
CONTACTS:
Allergan:
Investors:
Lisa DeFrancesco
(862) 261-7152
Media:
Mark Marmur
(862) 261-7558