Attached files
| file | filename |
|---|---|
| 8-K/A - 8-K/A - Mallinckrodt plc | mnk8-ka12213.htm |
Exhibit 99.1
MALLINCKRODT PLC | |||||||||||||
CONSOLIDATED AND COMBINED STATEMENTS OF INCOME | |||||||||||||
(unaudited, in millions, except per share data) | |||||||||||||
Three Months Ended | |||||||||||||
September 27, 2013 | Percent of Net sales | September 28, 2012 | Percent of Net sales | ||||||||||
Net sales | $ | 545.2 | 100.0 | % | $ | 513.1 | 100.0 | % | |||||
Cost of sales | 293.1 | 53.8 | 279.8 | 54.5 | |||||||||
Gross profit | 252.1 | 46.2 | 233.3 | 45.5 | |||||||||
Selling, general and administrative expenses | 135.5 | 24.9 | 140.4 | 27.4 | |||||||||
Research and development expenses | 43.3 | 7.9 | 36.6 | 7.1 | |||||||||
Separation costs | 3.6 | 0.7 | 8.1 | 1.6 | |||||||||
Restructuring charges, net | 15.3 | 2.8 | 0.7 | 0.1 | |||||||||
Gain on divestiture | (0.7 | ) | (0.1 | ) | (0.7 | ) | (0.1 | ) | |||||
Operating income | 55.1 | 10.1 | 48.2 | 9.4 | |||||||||
Interest expense | (9.9 | ) | (1.8 | ) | (0.1 | ) | — | ||||||
Interest income | 0.2 | — | — | — | |||||||||
Other income, net | (1.5 | ) | (0.3 | ) | 0.2 | — | |||||||
Income from continuing operations before income taxes | 43.9 | 8.1 | 48.3 | 9.4 | |||||||||
Provision for income taxes | 12.7 | 2.3 | 21.0 | 4.1 | |||||||||
Income from continuing operations | 31.2 | 5.7 | 27.3 | 5.3 | |||||||||
Gain (loss) from discontinued operations, net of income taxes | 2.3 | 0.4 | (1.1 | ) | (0.2 | ) | |||||||
Net income | $ | 33.5 | 6.1 | $ | 26.2 | 5.1 | |||||||
Basic earnings per share: | |||||||||||||
Income from continuing operations | $ | 0.54 | $ | 0.47 | |||||||||
Gain (loss) from discontinued operations | 0.04 | (0.02 | ) | ||||||||||
Net income | 0.58 | 0.45 | |||||||||||
Diluted earnings per share: | |||||||||||||
Income from continuing operations | $ | 0.54 | $ | 0.47 | |||||||||
Gain (loss) from discontinued operations | 0.04 | (0.02 | ) | ||||||||||
Net income | 0.58 | 0.45 | |||||||||||
Weighted-average number of shares outstanding(1): | |||||||||||||
Basic | 57.7 | 57.7 | |||||||||||
Diluted | 58.2 | 57.7 | |||||||||||
(1 | ) | For periods prior to the separation from Covidien, weighted-average number of shares reflects the number of ordinary shares of Mallinckrodt outstanding immediately following the separation. | |||||||||||
MALLINCKRODT PLC | ||||||||
ADJUSTED EBITDA RECONCILIATIONS | ||||||||
(unaudited, in millions) | ||||||||
Three Months Ended | ||||||||
September 27, 2013 | September 28, 2012 | |||||||
Net income | $ | 33.5 | $ | 26.2 | ||||
Adjustments: | ||||||||
Interest expense, net | 9.7 | 0.1 | ||||||
Provision for income taxes | 12.7 | 21.0 | ||||||
Depreciation expense | 28.6 | 26.5 | ||||||
Amortization expense | 8.8 | 7.0 | ||||||
(Gain) loss from discontinued operations, net of income taxes | (2.3 | ) | 1.1 | |||||
Other expense (income), net | 1.5 | (0.2 | ) | |||||
Restructuring charges, net | 15.3 | 0.7 | ||||||
Separation costs | 3.6 | 8.1 | ||||||
Up-front and milestone payments | 5.0 | — | ||||||
Adjusted EBITDA | $ | 116.4 | $ | 90.5 | ||||
Percent of Net sales | 21.3 | % | 17.6 | % | ||||
MALLINCKRODT PLC | ||||||||||||||||
NON-GAAP MEASURES | ||||||||||||||||
(unaudited, in millions except per share data, net of tax) | ||||||||||||||||
Three Months Ended | ||||||||||||||||
September 27, 2013 | September 28, 2012 | |||||||||||||||
Net income | Diluted net income per share (2) | Net income | Diluted net income per share (2) | |||||||||||||
GAAP | $ | 33.5 | $ | 0.58 | $ | 26.2 | $ | 0.45 | ||||||||
Adjustments (net of tax): | ||||||||||||||||
Separation costs | 2.4 | 0.04 | 7.5 | 0.13 | ||||||||||||
Restructuring and related charges, net (1) | 14.6 | 0.25 | 1.4 | 0.02 | ||||||||||||
Amortization expense | 5.5 | 0.09 | 4.4 | 0.08 | ||||||||||||
(Gain) loss from discontinued operations | (2.3 | ) | (0.04 | ) | 1.1 | 0.02 | ||||||||||
Up-front and milestone payments | 3.1 | 0.05 | — | — | ||||||||||||
As adjusted | $ | 56.8 | $ | 0.98 | $ | 40.6 | $ | 0.70 | ||||||||
(1) | Includes pre-tax accelerated depreciation of $0.5 million and $1.2 million for the three months ended September 27, 2013 and September 28, 2012, respectively. | |||||||||||||||
(2) | For periods prior to the separation from Covidien, weighted-average number of shares reflects the number of ordinary shares of Mallinckrodt outstanding immediately following the separation. | |||||||||||||||
MALLINCKRODT PLC | ||||||||||||||||||
SEGMENT NET SALES AND OPERATIONAL GROWTH | ||||||||||||||||||
(unaudited, in millions) | ||||||||||||||||||
Three Months Ended | ||||||||||||||||||
September 27, 2013 | September 28, 2012 | Percent change | Currency impact | Operational growth | ||||||||||||||
Specialty Pharmaceuticals | ||||||||||||||||||
Generics and API | $ | 247.3 | $ | 219.3 | 12.8 | % | (0.6 | )% | 13.4 | % | ||||||||
Brands | 57.1 | 39.6 | 44.2 | — | 44.2 | |||||||||||||
304.4 | 258.9 | 17.6 | (0.5 | ) | 18.1 | |||||||||||||
Global Medical Imaging | ||||||||||||||||||
Contrast Media and Delivery Systems | 119.6 | 132.7 | (9.9 | ) | (2.1 | ) | (7.8 | ) | ||||||||||
Nuclear Imaging | 109.4 | 110.1 | (0.6 | ) | 1.2 | (1.8 | ) | |||||||||||
229.0 | 242.8 | (5.7 | ) | (0.6 | ) | (5.1 | ) | |||||||||||
Other(1) | 11.8 | 11.4 | 3.5 | (4.3 | ) | 7.8 | ||||||||||||
Net Sales | $ | 545.2 | $ | 513.1 | 6.3 | % | (0.6 | )% | 6.9 | % | ||||||||
(1 | ) | Represents net sales to our former parent. | ||||||||||||||||
MALLINCKRODT PLC | |||||||||||||
SELECT PRODUCT LINE NET SALES | |||||||||||||
(unaudited, in millions) | |||||||||||||
Three Months Ended | |||||||||||||
September 27, 2013 | September 28, 2012 | Percent change | |||||||||||
Specialty Pharmaceuticals | |||||||||||||
Acetaminophen (API) products | $ | 46.4 | $ | 55.5 | (16.4 | )% | |||||||
Oxycodone (API) and oxycodone-containing tablets | 18.0 | 42.6 | (57.7 | ) | |||||||||
Hydrocodone (API) and hydrocodone-containing tablets | 34.8 | 27.7 | 25.6 | ||||||||||
Other controlled substances | 26.3 | 21.6 | 21.8 | ||||||||||
Methylphenidate HCl | 60.0 | — | — | (1) | |||||||||
Other | 61.8 | 71.9 | (14.0 | ) | |||||||||
Generics and API | 247.3 | 219.3 | 12.8 | ||||||||||
EXALGO | 33.9 | 28.3 | 19.8 | ||||||||||
Intrathecal products | 8.4 | — | — | (1) | |||||||||
Other | 14.8 | 11.3 | 31.0 | ||||||||||
Brands | 57.1 | 39.6 | 44.2 | ||||||||||
Specialty Pharmaceuticals Total | $ | 304.4 | $ | 258.9 | 17.6 | % | |||||||
Global Medical Imaging | |||||||||||||
Optiray | $ | 75.2 | $ | 88.7 | (15.2 | )% | |||||||
Optimark | 10.2 | 13.5 | (24.4 | ) | |||||||||
Other | 34.2 | 30.5 | 12.1 | ||||||||||
Contrast Media and Delivery Systems | 119.6 | 132.7 | (9.9 | ) | |||||||||
Ultra-Technekow DTE | 47.1 | 49.5 | (4.8 | ) | |||||||||
Octreoscan | 19.9 | 18.8 | 5.9 | ||||||||||
Other | 42.4 | 41.8 | 1.4 | ||||||||||
Nuclear Imaging | 109.4 | 110.1 | (0.6 | ) | |||||||||
Global Medical Imaging Total | $ | 229.0 | $ | 242.8 | (5.7 | )% | |||||||
(1) | Not meaningful | ||||||||||||
MALLINCKRODT PLC | |||||||||||||
SEGMENT OPERATING INCOME | |||||||||||||
(unaudited, in millions) | |||||||||||||
Three Months Ended | |||||||||||||
September 27, 2013 | Percent of segment Net sales | September 28, 2012 | Percent of segment Net sales | ||||||||||
Specialty Pharmaceuticals | $ | 76.9 | 25.3 | % | $ | 34.5 | 13.3 | % | |||||
Global Medical Imaging | 30.8 | 13.4 | % | 53.6 | 22.1 | % | |||||||
Segment operating income | 107.7 | 88.1 | |||||||||||
Unallocated amounts: | |||||||||||||
Corporate and allocated expenses | (24.4 | ) | (22.9 | ) | |||||||||
Intangible asset amortization | (8.8 | ) | (7.0 | ) | |||||||||
Restructuring and related charges, net (1) | (15.8 | ) | (1.9 | ) | |||||||||
Separation costs | (3.6 | ) | (8.1 | ) | |||||||||
Total operating income | $ | 55.1 | $ | 48.2 | |||||||||
(1 | ) | Includes accelerated depreciation of $0.5 million and $1.2 million for the three months ended September 27, 2013 and September 28, 2012, respectively. | |||||||||||
MALLINCKRODT PLC | |||||||||||||
CONSOLIDATED AND COMBINED STATEMENTS OF INCOME | |||||||||||||
(unaudited, in millions, except per share data) | |||||||||||||
Year Ended | |||||||||||||
September 27, 2013 | Percent of Net sales | September 28, 2012 | Percent of Net sales | ||||||||||
Net sales | $ | 2,204.5 | 100.0 | % | $ | 2,056.2 | 100.0 | % | |||||
Cost of sales | 1,179.6 | 53.5 | 1,091.4 | 53.1 | |||||||||
Gross profit | 1,024.9 | 46.5 | 964.8 | 46.9 | |||||||||
Selling, general and administrative expenses | 609.9 | 27.7 | 551.7 | 26.8 | |||||||||
Research and development expenses | 165.7 | 7.5 | 144.1 | 7.0 | |||||||||
Separation costs | 74.2 | 3.4 | 25.5 | 1.2 | |||||||||
Restructuring charges, net | 33.2 | 1.5 | 11.2 | 0.5 | |||||||||
Gain on divestiture | (2.9 | ) | (0.1 | ) | (2.9 | ) | (0.1 | ) | |||||
Operating income | 144.8 | 6.6 | 235.2 | 11.4 | |||||||||
Interest expense | (19.5 | ) | (0.9 | ) | (0.5 | ) | — | ||||||
Interest income | 0.3 | — | 0.4 | — | |||||||||
Other income, net | 0.8 | — | 1.0 | — | |||||||||
Income from continuing operations before income taxes | 126.4 | 5.7 | 236.1 | 11.5 | |||||||||
Provision for income taxes | 68.6 | 3.1 | 94.8 | 4.6 | |||||||||
Income from continuing operations | 57.8 | 2.6 | 141.3 | 6.9 | |||||||||
Gain (loss) from discontinued operations, net of income taxes | 1.0 | — | (6.7 | ) | (0.3 | ) | |||||||
Net income | $ | 58.8 | 2.7 | $ | 134.6 | 6.5 | |||||||
Basic earnings per share: | |||||||||||||
Income from continuing operations | $ | 1.00 | $ | 2.45 | |||||||||
Gain (loss) from discontinued operations | 0.02 | (0.12 | ) | ||||||||||
Net income | 1.02 | 2.33 | |||||||||||
Diluted earnings per share: | |||||||||||||
Income from continuing operations | $ | 1.00 | $ | 2.45 | |||||||||
Gain (loss) from discontinued operations | 0.02 | (0.12 | ) | ||||||||||
Net income | 1.02 | 2.33 | |||||||||||
Weighted-average number of shares outstanding(1): | |||||||||||||
Basic | 57.7 | 57.7 | |||||||||||
Diluted | 57.8 | 57.7 | |||||||||||
(1 | ) | For periods prior to the separation from Covidien, weighted-average number of shares reflects the number of ordinary shares of Mallinckrodt outstanding immediately following the separation. | |||||||||||
MALLINCKRODT PLC | ||||||||
ADJUSTED EBITDA RECONCILIATIONS | ||||||||
(unaudited, in millions) | ||||||||
Year Ended | ||||||||
September 27, 2013 | September 28, 2012 | |||||||
Net income | $ | 58.8 | $ | 134.6 | ||||
Adjustments: | ||||||||
Interest expense, net | 19.2 | 0.1 | ||||||
Provision for income taxes | 68.6 | 94.8 | ||||||
Depreciation expense | 104.1 | 103.6 | ||||||
Amortization expense | 35.4 | 27.3 | ||||||
(Gain) loss from discontinued operations, net of income taxes | (1.0 | ) | 6.7 | |||||
Other income, net | (0.8 | ) | (1.0 | ) | ||||
Restructuring charges, net | 33.2 | 11.2 | ||||||
Separation costs | 74.2 | 25.5 | ||||||
Up-front and milestone payments | 5.0 | — | ||||||
Adjusted EBITDA | $ | 396.7 | $ | 402.8 | ||||
Percent of Net sales | 18.0 | % | 19.6 | % | ||||
MALLINCKRODT PLC | ||||||||||||||||
NON-GAAP MEASURES | ||||||||||||||||
(unaudited, in millions except per share data, net of tax) | ||||||||||||||||
Year Ended | ||||||||||||||||
September 27, 2013 | September 28, 2012 | |||||||||||||||
Net income | Diluted net income per share (2) | Net income | Diluted net income per share (2) | |||||||||||||
GAAP | $ | 58.8 | $ | 1.02 | $ | 134.6 | $ | 2.33 | ||||||||
Adjustments (net of tax): | ||||||||||||||||
Separation costs | 70.0 | 1.21 | 23.7 | 0.41 | ||||||||||||
Restructuring and related charges, net (1) | 27.7 | 0.48 | 14.2 | 0.25 | ||||||||||||
Amortization expense | 22.1 | 0.38 | 17.1 | 0.30 | ||||||||||||
(Gain) loss from discontinued operations | (1.0 | ) | (0.02 | ) | 6.7 | 0.12 | ||||||||||
Up-front and milestone payments | 3.1 | 0.05 | — | — | ||||||||||||
As adjusted | $ | 180.7 | $ | 3.13 | $ | 196.3 | $ | 3.40 | ||||||||
(1) | Includes pre-tax accelerated depreciation of $2.6 million and $8.0 million for the fiscal year ended September 27, 2013 and September 28, 2012, respectively. | |||||||||||||||
(2) | For periods prior to the separation from Covidien, weighted-average number of shares reflects the number of ordinary shares of Mallinckrodt outstanding immediately following the separation. | |||||||||||||||
MALLINCKRODT PLC | |||||||||||||||||
SEGMENT NET SALES AND OPERATIONAL GROWTH | |||||||||||||||||
(unaudited, in millions) | |||||||||||||||||
Year Ended | |||||||||||||||||
September 27, 2013 | September 28, 2012 | Percent change | Currency impact | Operational growth | |||||||||||||
Specialty Pharmaceuticals | |||||||||||||||||
Generics and API | $ | 1,011.2 | $ | 848.8 | 19.1 | % | (0.5 | )% | 19.6 | % | |||||||
Brands | 206.4 | 156.4 | 32.0 | — | 32.0 | ||||||||||||
1,217.6 | 1,005.2 | 21.1 | (0.4 | ) | 21.5 | ||||||||||||
Global Medical Imaging | |||||||||||||||||
Contrast Media and Delivery Systems | 498.1 | 542.0 | (8.1 | ) | (1.8 | ) | (6.3 | ) | |||||||||
Nuclear Imaging | 437.6 | 454.8 | (3.8 | ) | 0.2 | (4.0 | ) | ||||||||||
935.7 | 996.8 | (6.1 | ) | (0.9 | ) | (5.2 | ) | ||||||||||
Other (1) | 51.2 | 54.2 | (5.5 | ) | (0.9 | ) | (4.6 | ) | |||||||||
Net Sales | $ | 2,204.5 | $ | 2,056.2 | 7.2 | % | (0.6 | )% | 7.8 | % | |||||||
(1) | Represents net sales to our former parent. | ||||||||||||||||
MALLINCKRODT PLC | |||||||||||||
SELECT PRODUCT LINE NET SALES | |||||||||||||
(unaudited, in millions) | |||||||||||||
Year Ended | |||||||||||||
September 27, 2013 | September 28, 2012 | Percent change | |||||||||||
Specialty Pharmaceuticals | |||||||||||||
Acetaminophen (API) products | $ | 216.2 | $ | 217.7 | (0.7 | )% | |||||||
Oxycodone (API) and oxycodone-containing tablets | 139.0 | 144.1 | (3.5 | ) | |||||||||
Hydrocodone (API) and hydrocodone-containing tablets | 140.0 | 130.5 | 7.3 | ||||||||||
Other controlled substances | 112.0 | 111.7 | 0.3 | ||||||||||
Methylphenidate HCl | 148.3 | — | — | (1) | |||||||||
Other | 255.7 | 244.8 | 4.5 | ||||||||||
Generics and API | 1,011.2 | 848.8 | 19.1 | ||||||||||
EXALGO | 126.1 | 91.9 | 37.2 | ||||||||||
Intrathecal products | 29.2 | — | — | (1) | |||||||||
Other | 51.1 | 64.5 | (20.8 | ) | |||||||||
Brands | 206.4 | 156.4 | 32.0 | ||||||||||
Specialty Pharmaceuticals Total | $ | 1,217.6 | $ | 1,005.2 | 21.1 | % | |||||||
Global Medical Imaging | |||||||||||||
Optiray | $ | 318.5 | $ | 352.2 | (9.6 | )% | |||||||
Optimark | 44.8 | 48.0 | (6.7 | ) | |||||||||
Other | 134.8 | 141.8 | (4.9 | ) | |||||||||
Contrast Media and Delivery Systems | 498.1 | 542.0 | (8.1 | ) | |||||||||
Ultra-Technekow DTE | 188.8 | 202.5 | (6.8 | ) | |||||||||
Octreoscan | 82.8 | 78.7 | 5.2 | ||||||||||
Other | 166.0 | 173.6 | (4.4 | ) | |||||||||
Nuclear Imaging | 437.6 | 454.8 | (3.8 | ) | |||||||||
Global Medical Imaging Total | $ | 935.7 | $ | 996.8 | (6.1 | )% | |||||||
(1) | Not meaningful | ||||||||||||
MALLINCKRODT PLC | |||||||||||||
SEGMENT OPERATING INCOME | |||||||||||||
(unaudited, in millions) | |||||||||||||
Year Ended | |||||||||||||
September 27, 2013 | Percent of segment Net sales | September 28, 2012 | Percent of segment Net sales | ||||||||||
Specialty Pharmaceuticals | $ | 311.7 | 25.6 | % | $ | 162.8 | 16.2 | % | |||||
Global Medical Imaging | 112.3 | 12.0 | % | 214.3 | 21.5 | % | |||||||
Segment operating income | 424.0 | 377.1 | |||||||||||
Unallocated amounts: | |||||||||||||
Corporate and allocated expenses | (133.8 | ) | (69.9 | ) | |||||||||
Intangible asset amortization | (35.4 | ) | (27.3 | ) | |||||||||
Restructuring and related charges, net (1) | (35.8 | ) | (19.2 | ) | |||||||||
Separation costs | (74.2 | ) | (25.5 | ) | |||||||||
Total operating income | $ | 144.8 | $ | 235.2 | |||||||||
(1 | ) | Includes accelerated depreciation of $2.6 million and $8.0 million for the fiscal year ended September 27, 2013 and September 28, 2012, respectively. | |||||||||||
Non-GAAP Financial Measures
The financial tables, as amended, furnished as Exhibit 99.1 to this Form 8-K/A contain financial measures, including adjusted net income, adjusted diluted earnings per share, adjusted EBITDA and operational growth, which are considered "non-GAAP" financial measures under applicable Securities and Exchange Commission rules and regulations.
Adjusted net income represents net income, prepared in accordance with accounting principles generally accepted in the U.S. ("GAAP"), excluding the after-tax effects related to separation costs; restructuring and related charges, net; amortization and discontinued operations. Adjusted diluted earnings per share represents adjusted net income divided by the number of diluted shares.
Adjusted EBITDA represents GAAP net income before net interest, income taxes, depreciation and amortization, adjusted to exclude certain items. These items, if applicable, include discontinued operations; other income, net; separation costs; restructuring charges, net; immediately expensed up-front and milestone payments; acquisition-related costs; and non-cash impairment charges.
Operational growth measures the change in net sales between current- and prior-year periods using a constant currency, the exchange rate in effect during the applicable prior-year period. This measure is one of the performance metrics that determines management incentive compensation.
The Company has provided these non-GAAP financial measures because they are used by management, along with financial measures in accordance with GAAP, to evaluate the Company's operating performance. In addition, the Company believes that they will be used by certain investors to measure Mallinckrodt's operating results. Management believes that presenting these non-GAAP measures provides useful information about the Company's performance across reporting periods on a consistent basis by excluding items that the Company does not believe are indicative of its core operating performance.
These non-GAAP measures should be considered supplemental to and not a substitute for financial information prepared in accordance with GAAP. The Company's definition of these non-GAAP measures may differ from similarly titled measures used by others.
Because non-GAAP financial measures exclude the effect of items that will increase or decrease the Company's reported results of operations, management strongly encourages investors to review the Company's consolidated and combined financial statements and publicly filed reports in their entirety. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures is included in the above tables.