0001585364-17-000080.txt : 20170523 0001585364-17-000080.hdr.sgml : 20170523 20170523153728 ACCESSION NUMBER: 0001585364-17-000080 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20170523 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20170523 DATE AS OF CHANGE: 20170523 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PERRIGO Co plc CENTRAL INDEX KEY: 0001585364 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 000000000 STATE OF INCORPORATION: L2 FISCAL YEAR END: 0627 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-36353 FILM NUMBER: 17863654 BUSINESS ADDRESS: STREET 1: TREASURY BUILDING STREET 2: LOWER GRAND CANAL STREET CITY: DUBLIN STATE: L2 ZIP: L2 2 BUSINESS PHONE: 269-673-8451 MAIL ADDRESS: STREET 1: 515 EASTERN AVENUE CITY: ALLEGAN STATE: MI ZIP: 49010 FORMER COMPANY: FORMER CONFORMED NAME: PERRIGO Co Ltd DATE OF NAME CHANGE: 20130828 8-K 1 cy16non-gaap8xkrecast.htm 8-K Document


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):
March 23, 2017
_______________________________________________
Perrigo Company plc
(Exact name of registrant as specified in its charter)
_______________________________________________

Commission file number 001-36353

Ireland
 
Not Applicable
(State or other jurisdiction of
incorporation or organization)
 
(I.R.S. Employer
Identification No.)
 
 
Treasury Building, Lower Grand Canal Street, Dublin 2, Ireland
 
-
(Address of principal executive offices)
 
(Zip Code)
+353 1 7094000
(Registrant’s telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
________________________________________ 

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:

[ ]     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))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company [ ]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]





Item 2.02    Results of Operations and Financial Condition

Exhibit 99.1 contains select segment financial metrics for the three months ended April 2, 2016, July 2, 2016, October 1, 2016, December 31, 2016, March 28, 2015, June 27, 2015, September 26, 2015, and December 31, 2015; and the twelve months ended December 31, 2016, December 31, 2015, and December 27, 2014.

The recast financial information contained in Exhibit 99.1 reflects a restatement of previously issued financial statements. The information in this Item 2.02, including Exhibit 99.1, should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 and the Company’s Amended Quarterly Reports on Form 10-Q/A for the quarters ended April 2, 2016, July 2, 2016 and October 1, 2016.

The information furnished pursuant to this Item 2.02, including Exhibits 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that Section, and shall not be deemed incorporated by reference into any filing of the Company under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

The recast financial statements contain certain non-GAAP measures. A "non-GAAP financial measure" is defined as a numerical measure of a company's financial performance that excludes or includes amounts different than the most directly comparable measure calculated and presented in accordance with U.S. Generally Accepted Accounting Principles (GAAP) in the statements of operation, balance sheets or statements of cash flows of the company. Pursuant to the requirements the U.S. Securities and Exchange Commission, the Company has provided reconciliations for net sales excluding sales attributable to held-for-sale businesses, adjusted gross profit, adjusted operating income, adjusted net income, adjusted diluted earnings per share, adjusted gross margin, adjusted operating margin, and adjusted diluted shares outstanding within this report to the most directly comparable U.S. GAAP measures for these non-GAAP measures. These non-GAAP financial measures should be considered as supplements to the GAAP reported measures, should not be considered replacements for, or superior to the GAAP measures and may not be comparable to similarly named measures used by other companies.
The Company provides non-GAAP financial measures as additional information that it believes is useful to investors and analysts in evaluating the performance of the Company's ongoing operating trends, facilitating comparability between periods and companies in similar industries and assessing the Company's prospects for future performance. These non-GAAP financial measures exclude items, such as impairment charges, restructuring charges, and acquisition and integration-related charges, that by their nature affect comparability of operational performance or obscure underlying business operational trends. The non-GAAP measures the Company provides are consistent with how management analyzes and assesses the operating performance of the Company, and disclosing them provides investor insight into management’s view of the business. Management uses these adjusted financial measures for planning and forecasting in future periods, and evaluating segment and overall operating performance. In addition, management uses certain of the profit measures as factors in determining compensation.

Non-GAAP measures related to profit measurements, which include adjusted gross profit, adjusted operating income, adjusted net income, and adjusted diluted earnings per share are useful to investors as they provide them with supplemental information to enhance their understanding of the Company’s underlying business performance and trends, and enhance the ability of investors and analysts to compare the Company’s period-to-period financial results. Management believes that adjusted gross margin and adjusted operating margin are useful to investors, in addition to the reasons discussed above, by allowing them to more easily compare and analyze trends in the Company’s peer business group and assisting them in comparing the Company’s overall performance to that of its competitors. The Company discloses adjusted net sales, which excludes operating results attributable to held-for-sale businesses, in order to provide information about sales of the Company’s continuing business. The Company believes these supplemental financial measures provide investors with consistency in financial reporting, enabling meaningful comparisons of past, present and future underlying operating results, and also facilitate comparison of the Company’s operating performance to the operating performance of its competitors.





Reported results were adjusted for the following items:

•
Amortization expense related primarily to acquired intangible assets
•
Operating results attributable to held-for-sale business
•
Acquisition and integration-related charges
•
Impairment charges
•
Restructuring charges
•
Unusual litigation
•
R&D payment made in connection with a collaborative agreement
•
Losses from derivatives associated primarily with the Omega acquisition
•
Amortization of inventory step-up related to Omega acquisition
•
Gains on divestitures
•
Financing fees and losses on early debt extinguishment
•
Losses on equity method investments
•
Tysabri® royalty stream - change in fair value
•
Legal and consulting fees related to Mylan defense
•
Investment losses
•
Transfer of rights agreement


Item 9.01. Financial Statements and Exhibits

(d) Exhibits

99.1
Recast restated historical financial information for calendar years 2014 - 2016, furnished solely pursuant to Item 2.02 hereof.






SIGNATURE

Pursuant to the requirement 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.



 
 
 
(Registrant)

 
 
 
PERRIGO COMPANY PLC

 
 
 
 
 
 
 
 
By:
/s/ Ronald L. Winowiecki
Dated:
March 23, 2017
 
 
Ronald L. Winowiecki
 
 
 
 
Acting Chief Financial Officer


         
                        
     




Exhibit Index

99.1
Recast restated historical financial information for calendar years 2014 - 2016, furnished solely pursuant to Item 2.02 hereof.




 EX-99.1 2 cy16non-gaaprecastex991.htm EXHIBIT 99.1 Exhibit


EXHIBIT 99.1

PERRIGO COMPANY PLC
SELECTED CONSOLIDATED INFORMATION
QUARTERS AND CALENDAR YEAR TO DATE 2016
(in millions)
(unaudited)
 
Three Months Ended
 
Twelve Months Ended
Consolidated
April 2,
2016
 
July 2,
2016
 
October 1,
2016
 
December 31,
2016
 
December 31,
2016
Net sales
$
1,347.3

 
$
1,340.5

 
$
1,261.6

 
$
1,331.2

 
$
5,280.6

Gross profit
$
533.1

 
$
546.5

 
$
484.5

 
$
487.7

 
$
2,051.8

Operating income (loss)
$
(231.6
)
 
$
184.8

 
$
(1,468.3
)
 
$
(484.6
)
 
$
(1,999.7
)
Net loss
$
(529.2
)
 
$
(534.3
)
 
$
(1,590.2
)
 
$
(1,359.1
)
 
$
(4,012.8
)
Diluted loss per share
$
(3.70
)
 
$
(3.73
)
 
$
(11.10
)
 
$
(9.48
)
 
$
(28.01
)
 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of net sales
 
 
 
 
 
 
Gross profit
39.6
 %
 
40.8
%
 
38.4
 %
 
36.6
 %
 
38.9
 %
Operating income (loss)
(17.2
)%
 
13.8
%
 
(116.4
)%
 
(36.4
)%
 
(37.9
)%






PERRIGO COMPANY PLC
SELECTED CONSOLIDATED INFORMATION
QUARTERS AND CALENDAR YEAR TO DATE 2015
(in millions)
(unaudited)
 
Three Months Ended
 
Twelve Months Ended
Consolidated
March 28,
2015
 
June 27,
2015
 
September 26,
2015
 
December 31,
2015
 
December 31,
2015
Net sales
$
967.2

 
$
1,415.2

 
$
1,273.2

 
$
1,359.1

 
$
5,014.7

Gross profit
$
369.4

 
$
601.0

 
$
535.2

 
$
543.7

 
$
2,049.4

Operating income (loss)
$
190.4

 
$
192.3

 
$
175.3

 
$
(107.7
)
 
$
450.4

Net income (loss)
$
(22.2
)
 
$
(22.2
)
 
$
260.9

 
$
(218.4
)
 
$
(1.9
)
Diluted earnings (loss) per share
$
(0.16
)
 
$
(0.15
)
 
$
1.78

 
$
(1.51
)
 
$
(0.01
)
 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of net sales
 
 
 
 
 
 
Gross profit
38.2
%
 
42.5
%
 
42.0
%
 
40.0
 %
 
40.9
%
Operating income (loss)
19.7
%
 
13.6
%
 
13.8
%
 
(7.9
)%
 
9.0
%


1



PERRIGO COMPANY PLC
SELECTED CONSOLIDATED INFORMATION
CALENDAR YEAR TO DATE 2014
(in millions)
(unaudited)

 
 
 
Twelve Months Ended
Consolidated
 
 
December 27,
2014
Net sales
 
 
$
3,853.8

Gross profit
 
 
$
1,407.7

Operating income
 
 
$
593.6

Net income
 
 
$
380.5

Diluted earnings per share
 
 
$
2.81

 
 
 
 
Selected ratios as a percentage of net sales
 
Gross profit
 
 
36.5
%
Operating income
 
 
15.4
%

2


PERRIGO COMPANY PLC
ADJUSTED SELECTED CONSOLIDATED INFORMATION (1)
QUARTERS AND CALENDAR YEAR TO DATE 2016
(in millions)
(unaudited)
 
Three Months Ended
 
Twelve Months Ended
Consolidated
April 2,
2016
 
July 2,
2016
 
October 1,
2016
 
December 31,
2016
 
December 31,
2016
Adjusted net sales
$
1,299.9

 
$
1,297.0

 
$
1,239.7

 
NA*

 
$
5,167.8

Adjusted gross profit
$
580.5

 
$
597.8

 
$
539.5

 
$
553.9

 
$
2,271.8

Adjusted operating income
$
274.0

 
$
297.9

 
$
253.8

 
$
258.5

 
$
1,084.2

Adjusted net income
$
188.9

 
$
185.2

 
$
176.4

 
$
177.5

 
$
728.0

Adjusted diluted earnings per share
$
1.32

 
$
1.31

 
$
1.23

 
$
1.24

 
$
5.07

 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of adjusted net sales
 
 
 
 
 
 
Adjusted gross profit
44.7
%
 
46.1
%
 
43.5
%
 
41.6
%
**
44.0
%
Adjusted operating income
21.1
%
 
23.0
%
 
20.5
%
 
19.4
%
**
21.0
%
 
 
 
 
 
 
 
 
 
 
* No adjusted sales in the period
 
 
 
 
 
 
 
 
 
** Selected ratios are as a percentage of reported net sales
 
 
 
 
 
 






PERRIGO COMPANY PLC
ADJUSTED SELECTED CONSOLIDATED INFORMATION (1)
QUARTERS AND CALENDAR YEAR TO DATE 2015
(in millions)
(unaudited)
 
Three Months Ended
 
Twelve Months Ended
Consolidated
March 28,
2015
 
June 27,
2015
 
September 26,
2015
 
December 31,
2015
 
December 31,
2015
Adjusted gross profit
$
397.9

 
$
653.2

 
$
573.0

 
$
581.9

 
$
2,205.9

Adjusted operating income
$
231.2

 
$
336.7

 
$
273.4

 
$
265.6

 
$
1,106.9

Adjusted net income
$
177.4

 
$
227.9

 
$
191.3

 
$
202.4

 
$
798.9

Adjusted diluted earnings per share
$
1.32

 
$
1.56

 
$
1.30

 
$
1.39

 
$
5.57

 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of reported net sales
 
 
 
 
 
 
Adjusted gross profit
41.1
%
 
46.2
%
 
45.0
%
 
42.8
%
 
44.0
%
Adjusted operating income
23.9
%
 
23.8
%
 
21.5
%
 
19.5
%
 
22.1
%










(1) See attached Table I for reconciliation to GAAP numbers.

3


PERRIGO COMPANY PLC
ADJUSTED SELECTED CONSOLIDATED INFORMATION (1)
CALENDAR YEAR TO DATE 2014
(in millions)
(unaudited)

 
 
Twelve Months Ended
Consolidated
 
December 27,
2014
Adjusted gross profit
 
$
1,514.2

Adjusted operating income
 
$
811.3

Adjusted net income
 
$
570.3

Adjusted diluted earnings per share
 
$
4.23

 
 
 
Selected ratios as a percentage of reported net sales
Adjusted gross profit
 
39.3
%
Adjusted operating income
 
21.1
%
 
 
 
 

(1) See attached Table I for reconciliation to GAAP numbers.


4


Table I
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS ENDED FOR CALENDAR YEAR 2016
(in millions)
(unaudited)
 
 
 
 
 
 
 
Three Months Ended
 
April 2, 2016
Consolidated
Net
Sales
Gross
Profit
Operating Income (Loss)
Net
Income
(Loss)
Diluted Earnings (Loss) per Share
Reported
$
1,347.3

$
533.1

$
(231.6
)
$
(529.2
)
$
(3.70
)
As a % of sales
 
39.6
%
(17.2
)%
 
 
Adjustments:
 
 
 
 
 
Amortization expense related primarily to acquired intangible assets
$
—

$
51.4

$
86.8

$
86.9

$
0.62

Operating results attributable to held-for-sale businesses*
(47.4
)
(6.8
)
(2.2
)
(2.2
)
(0.02
)
Restructuring charges
—

—

5.4

5.4

0.04

Tysabri® royalty stream - change in fair value
—

—

—

204.4

1.43

Acquisition and integration-related charges
—

2.8

11.7

12.0

0.08

Impairment charges
—

—

403.9

403.9

2.82

Losses on equity method investments
—

—

—

2.4

0.02

Loss on early debt extinguishment
—

—

—

0.4

—

Non-GAAP tax adjustments***
—

—

—

4.9

0.03

Adjusted
$
1,299.9

$
580.5

$
274.0

$
188.9

$
1.32

As a % of sales
 
44.7
%
21.1
 %
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
 
 
 
 
 
Reported
 
 
 
 
143.2

Effect of dilution as reported amount was a loss, while adjusted amount was income**
 
0.4

Adjusted
 
 
 
 
143.6

 
 
 
 
 
 
*Held-for-sale businesses include the U.S. VMS business and India API business.
 
 
**In the period of a net loss, diluted shares outstanding equal basic shares outstanding.
 
 
***The non-GAAP tax adjustment includes the following: (1) $(177.4) million of tax effects of pretax non-GAAP adjustments that are calculated based upon the specific rate of the applicable jurisdiction of the pretax item; and (2) $182.3 million of tax effects on non-GAAP income taxes related to the interim tax accounting requirements within ASC 740, Income Taxes. The GAAP tax benefit recorded in the current quarter related to these items has been excluded from non-GAAP net income.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

5


Table I (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS ENDED FOR CALENDAR YEAR 2016
(in millions)
(unaudited)
 
 
 
 
 
 
 
Three Months Ended
 
July 2, 2016
Consolidated
Net
Sales
Gross
Profit
Operating Income
Net
Income
(Loss)
Diluted Earnings (Loss) per Share
Reported
$
1,340.5

$
546.5

$
184.8

$
(534.3
)
$
(3.73
)
As a % of sales
 
40.8
%
13.8
%
 
 
Adjustments:
 
 
 
 
 
Amortization expense related primarily to acquired intangible assets
$
—

$
56.1

$
90.7

$
90.6

$
0.65

Impairment charges
—

—

10.5

34.6

0.24

Operating results attributable to held-for-sale businesses*
(43.5
)
(5.9
)
2.6

2.2

0.02

Restructuring charges
—

—

5.8

5.8

0.04

Tysabri® royalty stream - change in fair value
—

—

—

910.8

6.36

Acquisition and integration-related charges
—

1.1

3.5

3.4

0.02

Losses on equity method investments
—

—

—

1.8

0.01

Non-GAAP tax adjustments**
—

—

—

(329.7
)
(2.30
)
Adjusted
$
1,297.0

$
597.8

$
297.9

$
185.2

$
1.31

As a % of sales
 
46.1
%
23.0
%
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
 
 
 
 
 
Reported
 
 
 
 
143.2

Effect of dilution as reported amount was a loss, while adjusted amount was income***
 
0.4

Adjusted
 
 
 
 
143.6

 
 
 
 
 
 
*Held-for-sale businesses include the U.S. VMS business, European sports brand, and India API business.
**The non-GAAP tax adjustment includes the following: (1) $(124.8) million of tax effects of pretax non-GAAP adjustments that are calculated based upon the specific rate of the applicable jurisdiction of the pretax item; and (2) $(204.9) million of tax effects on non-GAAP income taxes related to the interim tax accounting requirements within ASC 740, Income Taxes. The GAAP tax benefit recorded in the current quarter related to these items has been excluded from non-GAAP net income.
***In the period of a net loss, diluted shares outstanding equal basic shares outstanding.
 



6


Table I (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS ENDED FOR CALENDAR YEAR 2016
(in millions)
(unaudited)
 
 
 
 
 
 
 
Three Months Ended
 
October 1, 2016
Consolidated
Net
Sales
Gross
Profit
Operating Income (Loss)
Net
Income
(Loss)
Diluted Earnings (Loss) per Share
Reported
$
1,261.6

$
484.5

$
(1,468.3
)
$
(1,590.2
)
$
(11.10
)
As a % of sales
 
38.4
%
(116.4
)%
 
 
Adjustments:
 
 
 
 
 
Amortization expense related primarily to acquired intangible assets
$
—

$
57.1

$
91.5

$
91.5

$
0.64

Operating results attributable to held-for-sale businesses*
(21.9
)
(2.9
)
3.5

3.9

0.03

Restructuring charges
—

—

6.6

6.6

0.05

Tysabri® royalty stream - change in fair value
—

—

—

377.4

2.63

Acquisition and integration-related charges
—

0.8

6.1

6.7

0.05

Impairment charges
—

—

1,614.4

1,614.4

11.25

Loss on early debt extinguishment
—

—

—

(0.4
)
—

Non-GAAP tax adjustments***
—

—

—

(333.5
)
(2.32
)
Adjusted
$
1,239.7

$
539.5

$
253.8

$
176.4

$
1.23

As a % of sales
 
43.5
%
20.5
 %
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
 
 
 
 
 
Reported
 
 
 
 
143.3

Effect of dilution as reported amount was a loss, while adjusted amount was income**
 
0.3

Adjusted
 
 
 
 
143.6

 
 
 
 
 
 
*Held-for-sale businesses include the U.S. VMS business, European sports brand, and India API business.
**In the period of a net loss, diluted shares outstanding equal basic shares outstanding.
 
***The non-GAAP tax adjustment includes the following: (1) $(313.1) million of tax effects of pretax non-GAAP adjustments that are calculated based upon the specific rate of the applicable jurisdiction of the pretax item; (2) $2.0 million of tax effects on non-GAAP income taxes related to the interim tax accounting requirements within ASC 740, Income Taxes; and (3) $(22.4) million of discrete income tax adjustments related to revisions to the weighted average blended tax rates used to calculate opening balance sheet deferred tax liabilities. The GAAP tax benefit recorded in the current quarter related to these items has been excluded from non-GAAP net income.



7


Table I (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS ENDED FOR CALENDAR YEAR 2016
(in millions)
(unaudited)
 
 
 
 
 
 
 
Three Months Ended
 
December 31, 2016
Consolidated
Net
Sales
Gross
Profit
Operating Income (Loss)
Net
Income
(Loss)
Diluted Earnings (Loss) per Share
Reported
$
1,331.2

$
487.7

$
(484.6
)
$
(1,359.1
)
$
(9.48
)
As a % of sales
 
36.6
%
(36.4
)%
 
 
Adjustments:
 
 
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
62.0

$
94.9

$
94.9

$
0.67

Impairment charges
 
—

602.2

600.5

4.18

Gain on divestitures
 
—

—

(7.8
)
(0.05
)
Unusual litigation
 
—

18.4

18.4

0.13

Restructuring charges
 
—

13.1

13.1

0.09

Tysabri® royalty stream - change in fair value
 
—

—

1,115.6

7.78

Operating results attributable to held-for-sale businesses*
 
4.2

11.5

11.5

0.08

Acquisition and integration-related charges
 
—

3.0

3.3

0.02

Non-GAAP tax adjustments***
 
—

—

(312.9
)
(2.18
)
Adjusted
 
$
553.9

$
258.5

$
177.5

$
1.24

As a % of reported sales
 
41.6
%
19.4
 %
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
 
 
 
 
 
Reported
 
 
 
 
143.4

Effect of dilution as reported amount was a loss, while adjusted amount was income**
 
0.2

Adjusted
 
 
 
 
143.6

 
 
 
 
 
 
*Held-for-sale businesses include the European sports brand and the India API business.
**In the period of a net loss, diluted shares outstanding equal basic shares outstanding.
*** The non-GAAP tax adjustment includes the following: (1) $(187.1) million of tax effects of pretax non-GAAP adjustments that are calculated based upon the specific rate of the applicable jurisdiction of the pretax item; (2) a $20.6 million effect on non-GAAP income taxes related to the interim tax accounting requirements within ASC 740, Income Taxes; and (3) discrete income tax adjustments of $(26.9) million related to jurisdictional tax rate changes in France & Italy, $102.6 million net impact of valuation allowances on deferred tax assets commensurate with non-GAAP pre-tax measures and $(222.1) million valuation allowance release due to the divestiture of the Tysabri® financial asset. The GAAP tax benefit recorded in the current quarter related to these items has been excluded from non-GAAP net income.
 
 
 
 
 
 


8


Table I (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
CALENDAR YEAR TO DATE 2016
(in millions)
(unaudited)
 
 
 
 
 
 
 
Twelve Months Ended
 
December 31, 2016
Consolidated
Net
Sales
Gross
Profit
Operating Income (Loss)
Net
Income
(Loss)
Diluted Earnings (Loss) per Share
Reported
$
5,280.6

$
2,051.8

$
(1,999.7
)
$
(4,012.8
)
$
(28.01
)
As a % of sales
 
38.9
%
(37.9
)%
 
 
Adjustments:
 
 
 
 
 
Amortization expense related primarily to acquired intangible assets
$
—

$
226.7

$
363.9

$
363.9

$
2.59

Acquisition and integration-related charges
—

4.7

24.3

25.4

0.18

Restructuring charges
—

—

31.0

31.0

0.22

Tysabri® royalty stream - change in fair value
—

—

—

2,608.2

18.16

Gain on divestitures
—

—

—

(7.7
)
(0.05
)
Losses on equity method investments
—

—

—

4.2

0.03

Operating results attributable to held-for-sale businesses*
(112.8
)
(11.4
)
15.3

15.3

0.11

Unusual litigation
—

—

18.4

18.4

0.13

Impairment charges
—

—

2,631.0

2,653.4

18.48

Non-GAAP tax adjustments***
—

—

—

(971.3
)
(6.77
)
Adjusted
$
5,167.8

$
2,271.8

$
1,084.2

$
728.0

$
5.07

As a % of sales
 
44.0
%
21.0
 %
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
 
 
 
 
 
Reported
 
 
 
 
143.3

Effect of dilution as reported amount was a loss, while adjusted amount was income**
0.3

Adjusted
 
 
 
 
143.6

 
 
 
 
 
 
*Held-for-sale businesses include the U.S. VMS business, European sports brand, and the India API business.
**In the period of a net loss, diluted shares outstanding equal basic shares outstanding.
 
***The non-GAAP tax adjustment includes the following: (1) $(802.5) million of tax effects of pretax non-GAAP adjustments that are calculated based upon the specific rate of the applicable jurisdiction of the pretax item; and (2) Discrete income tax adjustments of: $(49.3) million related to jurisdictional tax rate changes in Italy, UK, Germany & France, $102.6 million net impact of valuation allowances on deferred tax assets commensurate with non-GAAP pre-tax measures, and $(222.1) million valuation allowance release due to the divestiture of the Tysabri® financial asset. The GAAP tax benefit recorded in the current quarter related to these items has been excluded from non-GAAP net income.
 
 
 
 
 
 







9


Table I (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS ENDED FOR CALENDAR YEAR 2015
(in millions)
(unaudited)
 
 
 
 
 
 
 
Three Months Ended
 
March 28, 2015
Consolidated
Net
Sales
Gross
Profit
Operating Income
Net
Income
(Loss)
Diluted Earnings (Loss) per Share
Reported
$
967.2

$
369.4

$
190.4

$
(22.2
)
$
(0.16
)
As a % of sales
 
38.2
%
19.7
%
 
 
Adjustments:
 
 
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
28.5

$
35.3

$
35.2

$
0.26

Restructuring charges
 
—

1.1

1.1

0.01

Tysabri® royalty stream - change in fair value
 
—

—

(100.8
)
(0.75
)
Acquisition and integration-related charges
 
—

2.4

2.4

0.02

Losses from derivatives associated primarily with the Omega acquisition
 
—

—

258.3

1.92

Unusual litigation
 
—

2.0

2.0

0.01

Losses on equity method investments
 
—

—

0.3

—

Financing fees and loss on early debt extinguishment
 
—

—

18.7

0.14

Non-GAAP tax adjustments**
 
—

—

(17.6
)
(0.13
)
Adjusted
 
$
397.9

$
231.2

$
177.4

$
1.32

As a % of reported sales
 
41.1
%
23.9
%
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
 
 
 
 
 
Reported
 
 
 
 
140.8

Weighted-average effect from December 28, 2014 to March 28, 2015 of 6.8 million shares issued on November 26, 2014 to finance the Omega acquisition, which closed on March 30, 2015. In addition, effect of dilution as reported amount was a loss, while adjusted amount was income*.
(6.3
)
Adjusted
 
 
 
 
134.5

 
 
 
 
 
 
2015 QTD Net sales excluding the U.S. VMS business
 
 
 
 
Net Sales

Reported
 
 
 
 
$
967.2

Operating results attributable to held-for-sale businesses
 
 
 
 
(37.5
)
Adjusted
 
 
 
 
$
929.7

 
 
 
 
 
 
*In the period of a net loss, diluted shares outstanding equal basic shares outstanding.
 
**The non-GAAP tax adjustment includes the following: (1) $1.0 million of tax effects of pretax non-GAAP adjustments that are calculated based upon the specific rate of the applicable jurisdiction of the pretax item; and (2) $(18.6) million of tax effects on non-GAAP income taxes related to the interim tax accounting requirements within ASC 740, Income Taxes. The GAAP tax benefit recorded in the current quarter related to these items has been excluded from non-GAAP net income.
 
 
 
 
 
 
 


10


Table I (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS ENDED FOR CALENDAR YEAR 2015
(in millions)
(unaudited)
 
 
 
 
 
 
 
Three Months Ended
 
June 27, 2015
Consolidated
Net
Sales
Gross
Profit
Operating Income
Net Income (Loss)
Diluted Earnings (Loss) per Share
Reported
$
1,415.2

$
601.0

$
192.3

$
(22.2
)
$
(0.15
)
As a % of sales
 
42.5
%
13.6
%
 
 
Adjustments:
 
 
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
51.7

$
85.7

$
85.7

$
0.59

R&D payment made in connection with a collaborative agreement
 
—

18.0

18.0

0.12

Impairment charges
 
—

7.2

9.0

0.06

Restructuring charges
 
—

(0.1
)
(0.1
)
—

Tysabri® royalty stream - change in fair value
 
—

—

69.2

0.47

Losses on acquisition-related foreign currency hedges
 
—

—

5.5

0.04

Acquisition and integration-related charges
 
0.5

20.2

20.2

0.14

Legal and consulting fees related to Mylan defense
 
—

13.4

13.4

0.09

Losses on equity method investments
 
—

—

5.1

0.03

Loss on early debt extinguishment
 
—

—

0.9

0.01

Non-GAAP tax adjustments*
 
—

—

23.2

0.16

Adjusted
 
$
653.2

$
336.7

$
227.9

$
1.56

As a % of reported sales
 
46.2
%
23.8
%
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
 
 
 
 
 
Reported
 
 
 
 
146.3

Effect of dilution as reported amount was a loss, while adjusted amount was income**
0.5

Adjusted
 
 
 
 
146.8

 
 
 
 
 
 
2015 QTD Net sales excluding the U.S. VMS business and the European sports brand
 
Net Sales
Reported
 
 
 
 
$
1,415.2

Operating results attributable to held-for-sale businesses
 
 
(39.7
)
Adjusted
 
 
 
 
$
1,375.5

 
 
 
 
 
 
*The non-GAAP tax adjustment includes the following: (1) $(44.4) million of tax effects of pretax non-GAAP adjustments that are calculated based upon the specific rate of the applicable jurisdiction of the pretax item; (2) $21.1 million of tax effects on non-GAAP income taxes related to the interim tax accounting requirements within ASC 740, Income Taxes; and (3) $46.5 million of discrete income tax adjustments related to debt restructuring for the acquisition of Omega. The GAAP tax benefit recorded in the current quarter related to these items has been excluded from non-GAAP net income.
**In the period of a net loss, diluted shares outstanding equal basic shares outstanding.
 
 
 
 
 
 
 


11


Table I (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS ENDED FOR CALENDAR YEAR 2015
(in millions)
(unaudited)
 
 
 
 
 
 
 
Three Months Ended
 
September 26, 2015
Consolidated
Net
Sales
Gross
Profit
Operating Income
Net
Income
Diluted Earnings per Share
Reported
$
1,273.2

$
535.2

$
175.3

$
260.9

$
1.78

As a % of sales
 
42.0
%
13.8
%
 
 
Adjustments:
 
 
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
37.8

$
76.2

$
76.3

$
0.51

Restructuring charges
 
—

2.2

2.2

0.01

Tysabri® royalty stream - change in fair value
 
—

—

(173.8
)
(1.18
)
Losses on acquisition-related foreign currency hedges
 
—

—

4.7

0.03

Acquisition and integration-related charges
 
—

4.1

3.9

0.03

Legal and consulting fees related to Mylan defense
 
—

15.6

15.6

0.11

Losses on equity method investments
 
—

—

2.5

0.02

Non-GAAP tax adjustments*
 
—

—

(1.0
)
(0.01
)
Adjusted
 
$
573.0

$
273.4

$
191.3

$
1.30

As a % of reported sales
 
45.0
%
21.5
%
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
 
 
 
 
146.9

 
 
 
 
 
 
2015 QTD Net sales excluding the U.S. VMS business and the European sports brand
 
Net Sales
Reported
 
 
 
 
$
1,273.2

Operating results attributable to held-for-sale businesses
 
 
 
 
(40.9
)
Adjusted
 
 
 
 
$
1,232.3

 
 
 
 
 
 
*The non-GAAP tax adjustment includes the following: (1) $(0.6) million of tax effects of pretax non-GAAP adjustments that are calculated based upon the specific rate of the applicable jurisdiction of the pretax item; and (2) a $(0.4) million effect on non-GAAP income taxes related to the interim tax accounting requirements within ASC 740, Income Taxes. The GAAP tax benefit recorded in the current quarter related to these items has been excluded from non-GAAP net income.
 
 
 
 
 
 


12


Table I (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS ENDED FOR CALENDAR YEAR 2015
(in millions)
(unaudited)
 
 
 
 
 
 
 
Three Months Ended
 
December 31, 2015
Consolidated
Net
Sales
Gross
Profit
Operating Income (Loss)
Net
Income
(Loss)
Diluted Earnings (Loss) per Share
Reported
$
1,359.1

$
543.7

$
(107.7
)
$
(218.4
)
$
(1.51
)
As a % of sales
 
40.0
%
(7.9
)%
 
 
Adjustments:
 
 
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
38.2

$
54.9

$
54.9

$
0.38

Acquisition and integration-related charges
 
—

8.5

9.3

0.06

Legal and consulting fees related to Mylan defense
 
—

71.3

71.3

0.49

Impairment charges
 
—

215.6

226.3

1.56

Unusual litigation
 
—

(1.7
)
(1.7
)
(0.01
)
Losses on equity method investments
 
—

—

2.7

0.02

Loss on debt extinguishment
 
—

—

0.9

0.01

Restructuring charges
 
—

24.7

24.7

0.17

Tysabri® royalty stream - change in fair value
 
—

—

116.6

0.80

Non-GAAP tax adjustments*
 
—

—

(84.2
)
(0.58
)
Adjusted
 
$
581.9

$
265.6

$
202.4

$
1.39

As a % of reported sales
 
42.8
%
19.5
 %
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
 
 
 
 
 
Reported
 
 
 
 
144.9

In addition, effect of dilution as reported amount was a loss, while adjusted amount was income**
0.5

Adjusted
 
 
 
 
145.4

 
 
 
 
 
 
2015 QTD Net Sales excluding the U.S. VMS business and the European sports brand
Net Sales
Reported
 
 
 
 
$
1,359.1

Operating results attributable to held-for-sale businesses
 
 
 
 
(44.5
)
Adjusted
 
 
 
 
$
1,314.6

 
 
 
 
 
 
*The non-GAAP tax adjustment includes the following: (1) $(91.4) million of tax effects of pretax non-GAAP adjustments that are calculated based upon the specific rate of the applicable jurisdiction of the pretax item; (2) a $0.4 million effect on non-GAAP income taxes related to the interim tax accounting requirements within ASC 740, Income Taxes; and (3) $6.8 million of discrete income tax adjustments related to debt restructuring for the acquisition of Omega. The GAAP tax benefit recorded in the current quarter related to these items has been excluded from non-GAAP net income.
**In the period of a net loss, diluted shares outstanding equal basic shares outstanding.
 


13


Table I (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
CALENDAR YEAR TO DATE 2015
(in millions)
(unaudited)
 
 
 
 
 
 
 
Twelve Months Ended
 
December 31, 2015
Consolidated
Net
Sales
Gross
Profit
Operating Income
Net
Income
(Loss)
Diluted Earnings (Loss) per Share
Reported
$
5,014.7

$
2,049.4

$
450.4

$
(1.9
)
$
(0.01
)
As a % of sales
 
40.9
%
9.0
%
 
 
Adjustments:
 
 
 
 
 
Amortization expense related to acquired intangible assets
 
$
156.1

$
251.7

$
251.7

$
1.76

Losses on acquisition-related foreign currency hedges
 
—

—

268.5

1.87

Acquisition and integration-related charges
 
—

35.2

35.7

0.25

R&D payment made in connection with a collaborative agreement
 
—

18.0

18.0

0.13

Legal and consulting fees related to Mylan defense
 
—

100.3

100.3

0.70

Impairment charges
 
—

222.8

235.3

1.64

Losses on equity method investments
 
—

—

10.7

0.07

Restructuring charges
 
0.4

28.2

28.2

0.20

Tysabri® royalty stream - change in fair value
 
—

—

(88.8
)
(0.62
)
Unusual litigation
 
—

0.3

0.3

—

Loss on debt extinguishment
 
—

—

20.5

0.14

Non-GAAP tax adjustments*
 
—

—

(79.6
)
(0.56
)
Adjusted
 
$
2,205.9

$
1,106.9

$
798.9

$
5.57

As a % of reported sales
 
44.0
%
22.1
%
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
 
 
 
 
 
Reported
 
 
 
 
144.6

Weighted average effect of 6.8 million shares issued on November 26, 2014 to finance the Omega acquisition, which closed on March 30, 2015. In addition, effect of dilution as reported amount was a loss, while adjusted amount was income**
(1.2
)
Adjusted
 
 
 
 
143.4

 
 
 
 
 
 
2015 YTD Net Sales excluding the U.S. VMS business and the European sports brand
 
Net Sales

Reported
 
 
 
 
$
5,014.7

Operating results attributable to held-for-sale businesses
 
 
 
 
(162.6
)
Adjusted
 
 
 
 
$
4,852.1

 
 
 
 
 
 
* The non-GAAP tax adjustment includes the following: (1) $(135.5) million of tax effects of pretax non-GAAP adjustments that are calculated based upon the specific rate of the applicable jurisdiction of the pretax item; (2) a $2.5 million effect on non-GAAP income taxes related to the interim tax accounting requirements within ASC 740, Income Taxes; and (3) $53.4 million of discrete income tax adjustments related to debt restructuring for the acquisition of Omega. The GAAP tax benefit recorded in the current quarter related to these items has been excluded from non-GAAP net income.
**In the period of a net loss, diluted shares outstanding equal basic shares outstanding.
 






14


Table I (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
CALENDAR YEAR TO DATE 2014
(in millions)
(unaudited)
 
 
 
 
 
 
 
Twelve Months Ended
 
December 27, 2014
Consolidated
Net
Sales
Gross
Profit
Operating Income
Net
Income
Diluted Earnings per Share
Reported
$
3,853.8

$
1,407.7

$
593.6

$
380.5

$
2.81

As a % of sales
 
36.5
%
15.4
%
 
 
Adjustments:
 
 
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
105.7

$
132.2

$
132.2

$
1.00

Losses from derivatives associated primarily with the Omega acquisition
 
—

—

64.9

0.48

Tysabri® royalty stream - change in fair value
 
—

—

(66.2
)
(0.49
)
Acquisition and integration-related charges
 
0.8

23.5

29.7

0.22

Restructuring charges
 
—

34.2

34.2

0.25

Loss on extinguishment of debt
 
—

—

9.6

0.07

Initial payment made in connection with an R&D arrangement
 
—

10.0

10.0

0.07

Investment losses
 
—

—

12.7

0.09

Losses on equity method investments
 
—

—

10.2

0.08

Unusual litigation
 
—

17.8

17.8

0.13

Transfer of rights agreement
 
—

—

(12.5
)
(0.09
)
Non-GAAP tax adjustments**
 
—

—

(52.8
)
(0.39
)
Adjusted
 
$
1,514.2

$
811.3

$
570.3

$
4.23

As a % of reported sales
 
39.3
%
21.1
%
 
 
 
 
 
 
 
 
Diluted weighted average shares outstanding
 
 
 
 
 
Reported
 
 
 
 
135.0

Weighted-average effect from November 26, 2014 to December 27, 2014 of 6.8 million shares issued on November 26, 2014 to finance the Omega acquisition.
(0.6
)
Adjusted
 
 
 
 
134.4

 
 
 
 
 
 
**The non-GAAP tax adjustment includes the following: (1) $(46.8) million of tax effects of pretax non-GAAP adjustments that are calculated based upon the specific rate of the applicable jurisdiction of the pretax item; (2) $(2.5) million of tax effects on non-GAAP income taxes related to the interim tax accounting requirements within ASC 740, Income Taxes; and (3) $(1.5) million of discrete income tax adjustments related to prior year tax credits. The GAAP benefit recorded in the current quarter related to these items has been excluded from non-GAAP net income.


15


PERRIGO COMPANY PLC
SELECTED SEGMENT INFORMATION
QUARTERS AND CALENDAR YEAR TO DATE 2016
(in millions)
(unaudited)
 
Three Months Ended
 
Twelve Months Ended
Consumer Healthcare Americas
April 2,
2016
 
July 2,
2016
 
October 1,
2016
 
December 31,
2016
 
December 31,
2016
Net sales
$
639.1

 
$
630.0

 
$
611.2

 
$
626.8

 
$
2,507.1

Gross profit
$
196.0

 
$
220.0

 
$
199.2

 
$
210.0

 
$
825.2

Operating income
$
100.6

 
$
116.8

 
$
99.0

 
$
83.3

 
$
399.8

 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of net sales
 
 
 
 
 
 
Gross profit
30.7
%
 
34.9
%
 
32.6
%
 
33.5
%
 
32.9
%
Operating income
15.7
%
 
18.5
%
 
16.2
%
 
13.3
%
 
15.9
%
 
Three Months Ended
Twelve Months Ended
Consumer Healthcare International
April 2,
2016
 
July 2,
2016
 
October 1,
2016
 
December 31,
2016
 
December 31,
2016
Net sales
$
439.4

 
$
415.9

 
$
377.4

 
$
419.5

 
$
1,652.2

Gross profit
$
199.3

 
$
187.6

 
$
155.2

 
$
151.3

 
$
693.4

Operating income (loss)
$
(396.4
)
 
$
0.6

 
$
(1,615.5
)
 
$
(76.1
)
 
$
(2,087.4
)
 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of net sales
 
 
 
 
 
 
Gross profit
45.4
 %
 
45.1
%
 
41.1
 %
 
36.1
 %
 
42.0
 %
Operating income (loss)
(90.2
)%
 
0.1
%
 
(428.1
)%
 
(18.1
)%
 
(126.3
)%
 
Three Months Ended
 
Twelve Months Ended
Prescription Pharmaceuticals
April 2,
2016
 
July 2,
2016
 
October 1,
2016
 
December 31,
2016
 
December 31,
2016
Net sales
$
248.2

 
$
276.9

 
$
251.9

 
$
265.9

 
$
1,042.8

Gross profit
$
127.9

 
$
131.4

 
$
120.9

 
$
121.0

 
$
501.1

Operating income (loss)
$
91.4

 
$
92.6

 
$
74.4

 
$
(258.5
)
 
$
(0.2
)
 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of net sales
 
 
 
 
 
 
Gross profit
51.5
%
 
47.5
%
 
48.0
%
 
45.5
 %
 
48.1
%
Operating income (loss)
36.8
%
 
33.5
%
 
29.5
%
 
(97.3
)%
 
—
%


16


PERRIGO COMPANY PLC
SELECTED SEGMENT INFORMATION
QUARTERS AND CALENDAR YEAR TO DATE 2015
(in millions)
(unaudited)
 
Three Months Ended
 
Twelve Months Ended
Consumer Healthcare Americas
March 28,
2015
 
June 27,
2015
 
September 26,
2015
 
December 31,
2015
 
December 31,
2015
Net sales
$
622.8

 
$
679.9

 
$
608.3

 
$
643.2

 
$
2,554.2

Gross profit
$
196.9

 
$
231.9

 
$
211.6

 
$
206.2

 
$
846.7

Operating income
$
104.0

 
$
126.7

 
$
116.2

 
$
92.8

 
$
439.9

 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of net sales
 
 
 
 
 
 
Gross profit
31.6
%
 
34.1
%
 
34.8
%
 
32.1
%
 
33.2
%
Operating income
16.7
%
 
18.6
%
 
19.1
%
 
14.4
%
 
17.2
%
 
Three Months Ended
 
Twelve Months Ended
Consumer Healthcare International*
March 28,
2015
 
June 27,
2015
 
September 26,
2015
 
December 31,
2015
 
December 31,
2015
Net sales
$
76.6

 
$
450.9

 
$
398.8

 
$
434.3

 
$
1,360.6

Gross profit
$
21.2

 
$
207.4

 
$
189.7

 
$
196.3

 
$
614.7

Operating income (loss)
$
2.3

 
$
21.8

 
$
7.0

 
$
(155.5
)
 
$
(124.3
)
 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of net sales
 
 
 
 
 
 
Gross profit
27.7
%
 
46.0
%
 
47.6
%
 
45.2
 %
 
45.2
 %
Operating income (loss)
2.9
%
 
4.8
%
 
1.8
%
 
(35.8
)%
 
(9.1
)%
 
 
 
 
 
 
 
 
 
 
* We acquired Omega on March 30, 2015, thus data for the twelve months ended December 31, 2015 includes only nine months of results from operations attributable to Omega.
 
Three Months Ended
 
Twelve Months Ended
Prescription Pharmaceuticals
March 28,
2015
 
June 27,
2015
 
September 26,
2015
 
December 31,
2015
 
December 31,
2015
Net sales
$
237.0

 
$
262.2

 
$
243.6

 
$
259.1

 
$
1,001.9

Gross profit
$
135.5

 
$
154.3

 
$
122.8

 
$
130.8

 
$
543.3

Operating income
$
98.1

 
$
97.8

 
$
87.7

 
$
94.3

 
$
377.8

 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of net sales
 
 
 
 
 
 
Gross profit
57.2
%
 
58.9
%
 
50.4
%
 
50.5
%
 
54.2
%
Operating income
41.4
%
 
37.3
%
 
36.0
%
 
36.4
%
 
37.7
%


17


PERRIGO COMPANY PLC
SELECTED SEGMENT INFORMATION
CALENDAR YEAR TO DATE 2014
(in millions)
(unaudited)
 
 
 
Twelve Months Ended
Consumer Healthcare Americas
 
 
December 27,
2014
Net sales
 
 
$
2,503.6

Gross profit
 
 
$
776.7

Operating income
 
 
$
354.2

 
 
 
 
Selected ratios as a percentage of net sales
 
Gross profit
 
 
31.0
%
Operating income
 
 
14.1
%



 
 
 
Twelve Months Ended
Consumer Healthcare International
 
 
December 27,
2014
Net sales
 
 
$
348.7

Gross profit
 
 
$
107.6

Operating income
 
 
$
24.6

 
 
 
 
Selected ratios as a percentage of net sales
 
 
Gross profit
 
 
30.8
%
Operating income
 
 
7.1
%




 
 
 
Twelve Months Ended
Prescription Pharmaceuticals
 
 
December 27,
2014
Net sales
 
 
$
882.1

Gross profit
 
 
$
466.5

Operating income
 
 
$
330.7

 
 
 
 
Selected ratios as a percentage of net sales
 
Gross profit
 
 
52.9
%
Operating income
 
 
37.5
%



18


PERRIGO COMPANY PLC
ADJUSTED SELECTED SEGMENT INFORMATION (1)
QUARTERS AND CALENDAR YEAR TO DATE 2016
(in millions)
(unaudited)
 
Three Months Ended
 
Twelve Months Ended
Consumer Healthcare Americas
April 2,
2016
 
July 2,
2016
 
October 1,
2016
 
December 31,
2016
 
December 31,
2016
Adjusted net sales
$
592.0

 
$
587.8

 
$
590.2

 
NA*

 
$
2,396.9

Adjusted gross profit
$
204.6

 
$
226.3

 
$
209.1

 
$
222.6

 
$
862.6

Adjusted operating income
$
120.7

 
$
138.8

 
$
125.2

 
$
139.4

 
$
524.2

 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of adjusted net sales
 
 
 
 
 
 
Adjusted gross profit
34.6
%
 
38.5
%
 
35.4
%
 
35.5
%
**
36.0
%
Adjusted operating income
20.4
%
 
23.6
%
 
21.2
%
 
22.2
%
**
21.9
%
 
Three Months Ended
 
Twelve Months Ended
Consumer Healthcare International
April 2,
2016
 
July 2,
2016
 
October 1,
2016
 
December 31,
2016
 
December 31,
2016
Adjusted net sales
NA*

 
$
415.8

 
$
377.2

 
NA*

 
$
1,652.0

Adjusted gross profit
$
212.4

 
$
205.4

 
$
172.3

 
$
175.7

 
$
765.8

Adjusted operating income
$
54.8

 
$
56.6

 
$
40.5

 
$
36.4

 
$
188.2

 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of adjusted net sales
 
 
 
 
 
 
Adjusted gross profit
48.3
%
**
49.4
%
 
45.7
%
 
41.9
%
**
46.4
%
Adjusted operating income
12.5
%
**
13.6
%
 
10.7
%
 
8.7
%
**
11.4
%
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Twelve Months Ended
Prescription Pharmaceuticals
April 2,
2016
 
July 2,
2016
 
October 1,
2016
 
December 31,
2016
 
December 31,
2016
Adjusted gross profit
$
153.1

 
$
157.4

 
$
148.0

 
$
149.0

 
$
607.5

Adjusted operating income
$
116.9

 
$
118.5

 
$
106.5

 
$
115.0

 
$
456.9

 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of reported net sales
 
 
 
 
 
 
Adjusted gross profit
61.7
%
 
56.8
%
 
58.7
%
 
56.1
%
 
58.3
%
Adjusted operating income
47.1
%
 
42.8
%
 
42.3
%
 
43.2
%
 
43.8
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
* No adjusted sales in the period
 
 
 
 
 
 
 
 
 
** Selected ratios as a percentage of reported net sales
 
 
 
 
 
 
 
 



19


PERRIGO COMPANY PLC
ADJUSTED SELECTED SEGMENT INFORMATION (1)
QUARTERS AND CALENDAR YEAR TO DATE 2015
(in millions)
(unaudited)
 
Three Months Ended
 
Twelve Months Ended
Consumer Healthcare Americas
March 28,
2015
 
June 27,
2015
 
September 26,
2015
 
December 31,
2015
 
December 31,
2015
Adjusted gross profit
$
205.7

 
$
241.1

 
$
224.4

 
$
218.4

 
$
889.7

Adjusted operating income
$
119.2

 
$
147.7

 
$
135.6

 
$
125.3

 
$
527.8

 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of reported net sales
 
 
 
 
 
 
Adjusted gross profit
33.0
%
 
35.5
%
 
36.9
%
 
34.0
%
 
34.8
%
Adjusted operating income
19.1
%
 
21.7
%
 
22.3
%
 
19.5
%
 
20.7
%
 
Three Months Ended
 
Twelve Months Ended
Consumer Healthcare International*
March 28,
2015
 
June 27,
2015
 
September 26,
2015
 
December 31,
2015
 
December 31,
2015
Adjusted gross profit
$
26.1

 
$
235.1

 
$
199.9

 
$
207.7

 
$
668.8

Adjusted operating income
$
8.4

 
$
78.8

 
$
53.2

 
$
52.6

 
$
193.1

 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of reported net sales
 
 
 
 
 
 
Adjusted gross profit
34.1
%
 
52.1
%
 
50.1
%
 
47.8
%
 
49.2
%
Adjusted operating income
10.9
%
 
17.5
%
 
13.3
%
 
12.1
%
 
14.2
%
 
 
 
 
 
 
 
 
 
 
* We acquired Omega on March 30, 2015, thus data for the twelve months ended December 31, 2015 includes only nine months of results from operations attributable to Omega.
 
Three Months Ended
 
Twelve Months Ended
Prescription Pharmaceuticals
March 28,
2015
 
June 27,
2015
 
September 26,
2015
 
December 31,
2015
 
December 31,
2015
Adjusted gross profit
$
149.8

 
$
169.1

 
$
137.1

 
$
145.0

 
$
601.0

Adjusted operating income
$
114.4

 
$
131.5

 
$
101.9

 
$
109.2

 
$
457.0

 
 
 
 
 
 
 
 
 
 
Selected ratios as a percentage of reported net sales
 
 
 
 
 
 
Adjusted gross profit
63.2
%
 
64.5
%
 
56.3
%
 
56.0
%
 
60.0
%
Adjusted operating income
48.2
%
 
50.2
%
 
41.9
%
 
42.1
%
 
45.6
%

















(1) See attached Table II for reconciliation to GAAP numbers.

20


PERRIGO COMPANY PLC
ADJUSTED SELECTED SEGMENT INFORMATION (1)
CALENDAR YEAR TO DATE 2014
(in millions)
(unaudited)
 
 
 
Twelve Months Ended
Consumer Healthcare Americas
 
 
December 27,
2014
Adjusted gross profit
 
 
$
807.2

Adjusted operating income
 
 
$
425.5

 
 
 
 
Selected ratios as a percentage of reported net sales
 
Adjusted gross profit
 
 
32.2
%
Adjusted operating income
 
 
17.0
%



 
 
 
Twelve Months Ended
Consumer Healthcare International
 
 
December 27,
2014
Adjusted gross profit
 
 
$
129.3

Adjusted operating income
 
 
$
52.4

 
 
 
 
Selected ratios as a percentage of reported net sales
 
Adjusted gross profit
 
 
37.1
%
Adjusted operating income
 
 
15.0
%



 
 
 
Twelve Months Ended
Prescription Pharmaceuticals
 
 
December 27,
2014
Adjusted gross profit
 
 
$
518.7

Adjusted operating income
 
 
$
404.0

 
 
 
 
Selected ratios as a percentage of reported net sales
 
Adjusted gross profit
 
 
58.8
%
Adjusted operating income
 
 
45.8
%
 
 
 
 










(1) See attached Table II for reconciliation to GAAP numbers.

21


Table II
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS AND CALENDAR YEAR TO DATE 2016
(in millions)
(unaudited)
 
 
 
 
 
Three Months Ended
 
April 2, 2016
Consumer Healthcare Americas
Net
Sales
Gross
Profit
Operating Income
Reported
$
639.1

$
196.0

$
100.6

As a % of sales
 
30.7
%
15.7
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
$
—

$
12.8

$
18.1

Operating results attributable to held-for-sale business
(47.1
)
(7.0
)
(2.5
)
Restructuring charges
—

—

1.5

Acquisition and integration-related charges
—

2.8

3.0

Adjusted
$
592.0

$
204.6

$
120.7

As a % of sales
 
34.6
%
20.4
%
 
 
Three Months Ended
 
July 2, 2016
Consumer Healthcare Americas
Net
Sales
Gross
Profit
Operating Income
Reported
$
630.0

$
220.0

$
116.8

As a % of sales
 
34.9
%
18.5
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
$
—

$
12.5

$
17.6

Impairment charges
—

—

6.2

Operating results attributable to held-for-sale business
(42.2
)
(7.2
)
(3.1
)
Restructuring charges
—

—

0.3

Acquisition and integration-related charges
—

1.0

1.0

Adjusted
$
587.8

$
226.3

$
138.8

As a % of sales
 
38.5
%
23.6
%
 
 
 
 
 
Three Months Ended
 
October 1, 2016
Consumer Healthcare Americas
Net
Sales
Gross
Profit
Operating Income
Reported
$
611.2

$
199.2

$
99.0

As a % of sales
 
32.6
%
16.2
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
$
—

$
12.5

$
17.6

Impairment charges
—

—

3.7

Operating results attributable to held-for-sale business
(21.0
)
(3.4
)
(0.1
)
Restructuring charges
—

—

3.9

Acquisition and integration-related charges
—

0.8

1.1

Adjusted
$
590.2

$
209.1

$
125.2

As a % of sales
 
35.4
%
21.2
%

22


Table II (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS AND CALENDAR YEAR TO DATE 2016
(in millions)
(unaudited)
 
 
 
 
 
Three Months Ended
 
December 31, 2016
Consumer Healthcare Americas
Net
Sales
Gross
Profit
Operating Income
Reported
$
626.8

$
210.0

$
83.3

As a % of sales
 
33.5
%
13.3
 %
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
12.6

$
17.7

Unusual litigation
 
—

10.2

Impairment charges
 
—

27.1

Restructuring charges
 
—

(0.1
)
Acquisition and integration-related charges
 
—

1.2

Adjusted
 
$
222.6

$
139.4

As a % of reported sales
 
35.5
%
22.2
 %
 
 
 
 
 
Twelve Months Ended
 
December 31, 2016
Consumer Healthcare Americas
Net
Sales
Gross
Profit
Operating Income
Reported
$
2,507.1

$
825.2

$
399.8

As a % of sales
 
32.9
%
15.9
 %
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
$
—

$
50.3

$
71.0

Unusual litigation
—

—

10.2

Impairment charges
—

—

37.0

Operating results attributable to held-for-sale business
(110.2
)
(17.6
)
(5.7
)
Restructuring charges
—

—

5.6

Acquisition and integration-related charges
—

4.7

6.3

Adjusted
$
2,396.9

$
862.6

$
524.2

As a % of sales
 
36.0
%
21.9
 %
 
 
 
 
 
Three Months Ended
 
April 2, 2016
Consumer Healthcare International
Net
Sales
Gross
Profit
Operating Income (Loss)
Reported
$
439.4

$
199.3

$
(396.4
)
As a % of sales
 
45.4
%
(90.2
)%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
13.1

$
42.9

Impairment charges
 
—

403.9

Restructuring charges
 
—

3.1

Acquisition and integration-related charges
 
—

1.3

Adjusted
 
$
212.4

$
54.8

As a % of reported sales
 
48.3
%
12.5
 %



23


Table II (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS AND CALENDAR YEAR TO DATE 2016
(in millions)
(unaudited)
 
 
 
 
 
Three Months Ended
 
July 2, 2016
Consumer Healthcare International
Net
Sales
Gross
Profit
Operating Income
Reported
$
415.9

$
187.6

$
0.6

As a % of sales
 
45.1
%
0.1
 %
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
$
—

$
17.1

$
46.6

Impairment charges
—

—

—

Operating results attributable to held-for-sale business
(0.1
)
0.7

4.8

Restructuring charges
—

—

4.8

Acquisition and integration-related charges
—

—

(0.2
)
Adjusted
$
415.8

$
205.4

$
56.6

As a % of sales
 
49.4
%
13.6
 %
 
 
 
 
 
Three Months Ended
 
October 1, 2016
Consumer Healthcare International
Net
Sales
Gross
Profit
Operating Income (Loss)
Reported
$
377.4

$
155.2

$
(1,615.5
)
As a % of sales
 
41.1
%
(428.1
)%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
$
—

$
16.9

$
46.3

Impairment charges
—

—

1,604.5

Operating results attributable to held-for-sale business
(0.2
)
0.2

3.0

Restructuring charges
—

—

2.5

Acquisition and integration-related charges
—

—

(0.3
)
Adjusted
$
377.2

$
172.3

$
40.5

As a % of sales
 
45.7
%
10.7
 %
 
 
 
 
 
Three Months Ended
 
December 31, 2016
Consumer Healthcare International
Net
Sales
Gross
Profit
Operating Income (Loss)
Reported
$
419.5

$
151.3

$
(76.1
)
As a % of sales
 
36.1
%
(18.1
)%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
20.8

$
48.4

Impairment charges
 
—

34.1

Operating results attributable to held-for-sale business
 
3.6

10.3

Restructuring charges
 
—

10.5

Unusual litigation
 
—

8.2

Acquisition and integration-related charges
 
—

1.0

Adjusted
 
$
175.7

$
36.4

As a % of reported sales
 
41.9
%
8.7
 %

24


Table II (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS AND CALENDAR YEAR TO DATE 2016
(in millions)
(unaudited)
 
 
 
 
 
Twelve Months Ended
 
December 31, 2016
Consumer Healthcare International
Net
Sales
Gross
Profit
Operating Income (Loss)
Reported
$
1,652.2

$
693.4

$
(2,087.4
)
As a % of sales
 
42.0
%
(126.3
)%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
$
—

$
68.1

$
184.2

Impairment charges
—

—

2,042.4

Operating results attributable to held-for-sale business
(0.2
)
4.3

18.0

Restructuring charges
—

—

20.9

Unusual litigation
—

—

8.2

Acquisition and integration-related charges
—

—

1.9

Adjusted
$
1,652.0

$
765.8

$
188.2

As a % of sales
 
46.4
%
11.4
 %
 
 
 
 
 
Three Months Ended
 
April 2, 2016
Prescription Pharmaceuticals
Net
Sales
Gross
Profit
Operating Income
Reported
$
248.2

$
127.9

$
91.4

As a % of sales
 
51.5
%
36.8
 %
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
25.2

$
25.5

Adjusted
 
$
153.1

$
116.9

As a % of reported sales
 
61.7
%
47.1
 %
 
 
Three Months Ended
 
July 2, 2016
Prescription Pharmaceuticals
Net
Sales
Gross
Profit
Operating Income
Reported
$
276.9

$
131.4

$
92.6

As a % of sales
 
47.5
%
33.5
 %
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
26.0

$
25.9

Adjusted
 
$
157.4

$
118.5

As a % of reported sales
 
56.8
%
42.8
 %


25


Table II (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS AND CALENDAR YEAR TO DATE 2016
(in millions)
(unaudited)
 
 
 
 
 
Three Months Ended
 
October 1, 2016
Prescription Pharmaceuticals
Net
Sales
Gross
Profit
Operating Income
Reported
$
251.9

$
120.9

$
74.4

As a % of sales
 
48.0
%
29.5
 %
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
27.1

$
27.1

Acquisition and integration-related charges
 
—

5.0

Adjusted
 
$
148.0

$
106.5

As a % of reported sales
 
58.7
%
42.3
 %
 
 
 
 
 
Three Months Ended
 
December 31, 2016
Prescription Pharmaceuticals
Net
Sales
Gross
Profit
Operating Income (Loss)
Reported
$
265.9

$
121.0

$
(258.5
)
As a % of sales
 
45.5
%
(97.3
)%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
28.0

$
28.1

Impairment charges
 
—

342.4

Restructuring charges
 
—

2.1

Acquisition and integration-related charges
 
—

0.9

Adjusted
 
$
149.0

$
115.0

As a % of reported sales
 
56.1
%
43.2
 %
 
 
Twelve Months Ended
 
December 31, 2016
Prescription Pharmaceuticals
Net
Sales
Gross
Profit
Operating Income (Loss)
Reported
$
1,042.8

$
501.1

$
(0.2
)
As a % of sales
 
48.1
%
—
 %
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
106.4

$
106.7

Impairment charges
 
—

342.4

Restructuring charges
 
—

2.1

Acquisition and integration-related charges
 
—

5.9

Adjusted
 
$
607.5

$
456.9

As a % of reported sales
 
58.3
%
43.8
 %
 
 
 
 



26


Table II (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS AND CALENDAR YEAR TO DATE 2015
(in millions)
(unaudited)
 
 
 
 
 
Three Months Ended
 
March 28, 2015
Consumer Healthcare Americas
Net
Sales
Gross
Profit
Operating Income
Reported
$
622.8

$
196.9

$
104.0

As a % of reported net sales
 
31.6
%
16.7
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
8.8

$
14.1

Restructuring charges
 
—

1.1

Adjusted
 
$
205.7

$
119.2

As a % of reported net sales
 
33.0
%
19.1
%
 
For Comparative Purposes*
 
 
 
Reported
$
622.8

 
 
Operating results attributable to held-for-sale business
(37.5
)
 
 
Adjusted
$
585.3

 
 
 
 
 
 
*Q1 2015 net sales adjustment is made for comparison purposes only and does not change any other prior year financial information or metrics since the U.S. VMS business was not held-for-sale in 2015. Q1 2015 gross margin and operating margin use reported net sales as the denominator.
 
 
 
Three Months Ended
 
June 27, 2015
Consumer Healthcare Americas
Net
Sales
Gross
Profit
Operating Income
Reported
$
679.9

$
231.9

$
126.7

As a % of reported net sales
 
34.1
%
18.6
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
9.2

$
14.6

Impairment charges
 
—

6.8

Restructuring charges
 
—

(0.4
)
Adjusted
 
$
241.1

$
147.7

As a % of reported net sales
 
35.5
%
21.7
%
 
 
 
 
For Comparative Purposes*
 
 
 
Reported
$
679.9

 
 
Operating results attributable to held-for-sale business
(39.6
)
 
 
Adjusted
$
640.3

 
 
 
 
 
 
*Q2 2015 net sales adjustment is made for comparison purposes only and does not change any other prior year financial information or metrics since the U.S. VMS business was not held-for-sale in 2015. Q2 2015 gross margin and operating margin use reported net sales as the denominator.







27


Table II (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS AND CALENDAR YEAR TO DATE 2015
(in millions)
(unaudited)
 
 
 
 
 
Three Months Ended
 
September 26, 2015
Consumer Healthcare Americas
Net
Sales
Gross
Profit
Operating Income
Reported
$
608.3

$
211.6

$
116.2

As a % of reported net sales
 
34.8
%
19.1
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
12.8

$
18.0

Restructuring charges
 
—

1.9

Acquisition and integration-related charges
 
—

(0.5
)
Adjusted
 
$
224.4

$
135.6

As a % of reported net sales
 
36.9
%
22.3
%
 
 
 
 
For Comparative Purposes*
 
 
 
Reported
$
608.3

 
 
Operating results attributable to held-for-sale business
(40.9
)
 
 
Adjusted
$
567.4

 
 
 
 
 
 
*Q3 2015 net sales adjustment is made for comparison purposes only and does not change any other prior year financial information or metrics since the U.S. VMS business was not held-for-sale in 2015. Q3 2015 gross margin and operating margin use reported net sales as the denominator.
 
 
 
 
 
Three Months Ended
 
December 31, 2015
Consumer Healthcare Americas
Net
Sales
Gross
Profit
Operating Income
Reported
$
643.2

$
206.2

$
92.8

As a % of reported net sales
 
32.1
%
14.4
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
12.2

$
17.9

Impairment charges
 
—

1.5

Unusual litigation
 
—

0.3

Restructuring charges
 
—

12.8

Adjusted
 
$
218.4

$
125.3

As a % of reported net sales
 
34.0
%
19.5
%
 
 
 
 
For Comparative Purposes*
 
 
 
Reported
$
643.2

 
 
Operating results attributable to held-for-sale business
(44.3
)
 
 
Adjusted
$
598.9

 
 
 
 
 
 
*Q4 2015 net sales adjustment is made for comparison purposes only and does not change any other prior year financial information or metrics since the U.S. VMS business was not held-for-sale in 2015. Q4 2015 gross margin and operating margin use reported net sales as the denominator.
 
 
 
 

28


Table II (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS AND CALENDAR YEAR TO DATE 2015
(in millions)
(unaudited)
 
 
 
Twelve Months Ended
 
December 31, 2015
Consumer Healthcare Americas
Net
Sales
Gross
Profit
Operating Income
Reported
$
2,554.2

$
846.7

$
439.9

As a % of reported net sales
 
33.2
%
17.2
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
43.0

$
64.4

Impairment charges
 
—

8.3

Unusual litigation
 
—

0.3

Restructuring charges
 
—

15.4

Acquisition and integration-related charges
 
—

(0.5
)
Adjusted
 
$
889.7

$
527.8

As a % of reported net sales
 
34.8
%
20.7
%
 
 
 
 
For Comparative Purposes*
 
 
 
Reported
$
2,554.2

 
 
Operating results attributable to held-for-sale business
(162.3
)

 
Adjusted
$
2,391.9

 
 
 
 
 
 
*YTD 2015 net sales adjustment is made for comparison purposes only and does not change any other prior year financial information or metrics since the U.S. VMS business was not held-for-sale in 2015. YTD 2015 gross margin and operating margin use reported net sales as the denominator.
 
 
 
 
 
Three Months Ended
 
March 28, 2015
Consumer Healthcare International
Net
Sales
Gross
Profit
Operating Income
Reported
$
76.6

$
21.2

$
2.3

As a % of reported net sales
 
27.7
%
2.9
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
4.9

$
6.1

Adjusted
 
$
26.1

$
8.4

As a % of reported net sales
 
34.1
%
10.9
%
 
 
 
 


29


Table II (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS AND CALENDAR YEAR TO DATE 2015
(in millions)
(unaudited)
 
 
 
 
 
Three Months Ended
 
June 27, 2015
Consumer Healthcare International
Net
Sales
Gross
Profit
Operating Income
Reported
$
450.9

$
207.4

$
21.8

As a % of reported net sales
 
46.0
%
4.8
 %
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
27.7

$
56.0

Restructuring charges
 
—

0.3

Acquisition and integration-related charges
 
—

0.7

Adjusted
 
$
235.1

$
78.8

As a % of reported net sales
 
52.1
%
17.5
 %
 
For Comparative Purposes*
 
 
 
Reported
$
450.9

 
 
Operating results attributable to held-for-sale business
(0.1
)
 
 
Adjusted
$
450.8

 
 
 
 
 
 
*Q2 2015 net sales adjustment is made for comparison purposes only and does not change any other prior year financial information or metrics since the European sports brand was not held-for-sale in 2015. Q2 2015 gross margin and operating margin use reported net sales as the denominator.
 
 
 
Three Months Ended
 
September 26, 2015
Consumer Healthcare International
Net
Sales
Gross
Profit
Operating Income
Reported
$
398.8

$
189.7

$
7.0

As a % of reported net sales
 
47.6
%
1.8
 %
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
10.2

$
43.2

Restructuring charges
 
—

0.2

Acquisition and integration-related charges
 
—

2.8

Adjusted
 
$
199.9

$
53.2

As a % of reported net sales
 
50.1
%
13.3
 %
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

30


 
 
 
 
Table II (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS AND CALENDAR YEAR TO DATE 2015
(in millions)
(unaudited)
 
 
 
 
 
Three Months Ended
 
December 31, 2015
Consumer Healthcare International
Net
Sales
Gross
Profit
Operating Income (Loss)
Reported
$
434.3

$
196.3

$
(155.5
)
As a % of reported net sales
 
45.2
%
(35.8
)%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
11.4

$
23.0

Impairment charges
 
—

185.1

Restructuring charges
 
—

0.2

Acquisition and integration-related charges
 
—

(0.2
)
Adjusted
 
$
207.7

$
52.6

As a % of reported net sales
 
47.8
%
12.1
 %
 
 
 
 
For Comparative Purposes*
 
 
 
Reported
$
434.3

 
 
Operating results attributable to held-for-sale business
(0.2
)
 
 
Adjusted
$
434.1

 
 
 
 
 
 
*Q4 2015 net sales adjustment is made for comparison purposes only and does not change any other prior year financial information or metrics since the European sports brand was not held-for-sale in 2015. Q4 2015 gross margin and operating margin use reported net sales as the denominator.
 
 
 
 
 
Twelve Months Ended
 
December 31, 2015
Consumer Healthcare International
Net
Sales
Gross
Profit
Operating Income (Loss)
Reported
$
1,360.6

$
614.7

$
(124.3
)
As a % of reported net sales
 
45.2
%
(9.1
)%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
54.1

$
128.3

Impairment charges
 
—

185.1

Restructuring charges
 
—

0.7

Acquisition and integration-related charges
 
—

3.3

Adjusted
 
$
668.8

$
193.1

As a % of reported net sales
 
49.2
%
14.2
 %
 
 
 
 
For Comparative Purposes*
 
 
 
Reported
$
1,360.6

 
 
Operating results attributable to held-for-sale business
(0.3
)
 
 
Adjusted
$
1,360.3

 
 
 
 
 
 
*YTD 2015 net sales adjustment is made for comparison purposes only and does not change any other prior year financial information or metrics since the European sports brand was not held-for-sale in 2015. YTD 2015 gross margin and operating margin use reported net sales as the denominator.
 
 
 
 

31



Table II (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS AND CALENDAR YEAR TO DATE 2015
(in millions)
(unaudited)
 
 
 
 
 
Three Months Ended
 
March 28, 2015
Prescription Pharmaceuticals
Net
Sales
Gross
Profit
Operating Income
Reported
$
237.0

$
135.5

$
98.1

As a % of reported net sales
 
57.2
%
41.4
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
14.3

$
14.3

Unusual litigation
 
—

2.0

Adjusted
 
$
149.8

$
114.4

As a % of reported net sales
 
63.2
%
48.2
%
 
 
 
 
 
Three Months Ended
 
June 27, 2015
Prescription Pharmaceuticals
Net
Sales
Gross
Profit
Operating Income
Reported
$
262.2

$
154.3

$
97.8

As a % of reported net sales
 
58.9
%
37.3
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
14.3

$
14.3

R&D payment made in connection with a collaborative agreement
 
—

18.0

Acquisition and integration-related charges
 
0.5

1.4

Adjusted
 
$
169.1

$
131.5

As a % of reported net sales
 
64.5
%
50.2
%
 
 
 
 
 
Three Months Ended
 
September 26, 2015
Prescription Pharmaceuticals
Net
Sales
Gross
Profit
Operating Income
Reported
$
243.6

$
122.8

$
87.7

As a % of reported net sales
 
50.4
%
36.0
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
14.3

$
14.2

Adjusted
 
$
137.1

$
101.9

As a % of reported net sales
 
56.3
%
41.9
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

32


Table II (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
QUARTERS AND CALENDAR YEAR TO DATE 2015
(in millions)
(unaudited)
 
 
Three Months Ended
 
December 31, 2015
Prescription Pharmaceuticals
Net
Sales
Gross
Profit
Operating Income
Reported
$
259.1

$
130.8

$
94.3

As a % of reported net sales
 
50.5
%
36.4
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
14.2

$
14.3

Unusual litigation
 
—

(2.0
)
Restructuring charges
 
—

2.6

Adjusted
 
$
145.0

$
109.2

As a % of reported net sales
 
56.0
%
42.1
%
 
 
 
 
 
Twelve Months Ended
 
December 31, 2015
Prescription Pharmaceuticals
Net
Sales
Gross
Profit
Operating Income
Reported
$
1,001.9

$
543.3

$
377.8

As a % of reported net sales
 
54.2
%
37.7
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
57.2

$
57.2

Restructuring charges
 
—

2.6

R&D payment made in connection with a collaborative agreement
 
—

18.0

Acquisition and integration-related charges
 
0.5

1.4

Adjusted
 
$
601.0

$
457.0

As a % of reported net sales
 
60.0
%
45.6
%

33


Table II (continued)
PERRIGO COMPANY PLC
RECONCILIATION OF NON-GAAP MEASURES
CALENDAR YEAR TO DATE 2014
(in millions)
(unaudited)
 
 
 
 
 
Twelve Months Ended
 
December 27, 2014
Consumer Healthcare Americas
Net
Sales
Gross
Profit
Operating Income
Reported
$
2,503.6

$
776.7

$
354.2

As a % of reported net sales
 
31.0
%
14.1
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
29.8

$
50.9

R&D payment made in connection with a collaborative agreement
 
—

10.0

Restructuring charges
 
—

7.2

Unusual litigation
 
—

2.8

Acquisition and integration-related charges
 
0.7

0.4

Adjusted
 
$
807.2

$
425.5

As a % of reported net sales
 
32.2
%
17.0
%
 
 
Twelve Months Ended
 
December 27, 2014
Consumer Healthcare International
Net
Sales
Gross
Profit
Operating Income
Reported
$
348.7

$
107.6

$
24.6

As a % of reported net sales
 
30.8
%
7.1
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
$
21.9

$
26.9

Acquisition and integration-related charges
 
(0.2
)
0.9

Adjusted
 
$
129.3

$
52.4

As a % of reported net sales
 
37.1
%
15.0
%
 
 
 
 
 
Twelve Months Ended
 
December 27, 2014
Prescription Pharmaceuticals
Net
Sales
Gross
Profit
Operating Income
Reported
$
882.1

$
466.5

$
330.7

As a % of reported net sales
 
52.9
%
37.5
%
Adjustments:
 
 
 
Amortization expense related primarily to acquired intangible assets
 
52.1

52.1

Restructuring charges
 
—

0.2

Acquisition and integration-related charges
 
0.1

6.0

Unusual litigation
 
—

15.0

Adjusted
 
$
518.7

$
404.0

As a % of reported net sales
 
58.8
%
45.8
%




34