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For the fourth quarter 2014, adjusted EBITDA increased 80 percent to
For the full year 2014, non-GAAP net revenue increased 48 percent to
Fourth quarter and full year 2014 results for
Exceptional Performance; Transformative Year
"Our fourth quarter results demonstrate our laser-like commitment to drive strong growth and sustainable value creation across our businesses, while simultaneously executing transformative business development initiatives," said Brent Saunders, CEO and President of Actavis. "In our North American Brands business, six of our top ten brand products saw double-digit growth, including our strongest performers Namenda®franchise, Linzess®, Estrace® Cream, Teflaro® and Bystolic®. In our North American Generics business, strong results were driven by continued performance of our generic versions of Lidoderm® and Concerta®, and fourth quarter launches of generic versions of Intuniv™ and Celebrex®. We continue to invest in expanding our brand and generic portfolios, with nine new product and line extension launches planned in 2015, and industry-leading expansion of our generic pipeline, with 44 Abbreviated New Drug Applications (ANDAs) submitted in 2014. At year end, we had more than 65 first-to-file Abbreviated New Drug Applications (ANDAs) and approximately 230 ANDAs in total pending at the
"Without taking the focus off growing our businesses organically, 2014 represented an exceptional period of expansion through mergers and acquisitions. In addition to completion of the
Fourth Quarter and Full Year 2014 Business Segment Results
North America Brands Segment Information |
||||||||
(unaudited; $ in millions) |
||||||||
Three Months Ended |
Twelve Months Ended |
|||||||
December 31, |
December 31, |
|||||||
2014 |
2013 |
2014 |
2013 |
|||||
Product sales |
$ 1,813.4 |
$ 616.0 |
$ 4,568.0 |
$ 995.0 |
||||
Other revenue |
17.5 |
19.1 |
63.4 |
67.5 |
||||
Net revenues |
1,830.9 |
635.1 |
4,631.4 |
1,062.5 |
||||
Operating expenses: |
||||||||
Cost of sales(1) |
593.4 |
238.0 |
1,649.0 |
343.6 |
||||
Selling and marketing |
362.6 |
128.2 |
1,057.5 |
264.8 |
||||
General and administrative |
467.6 |
159.0 |
997.4 |
237.9 |
||||
Segment contribution |
$ 407.3 |
$ 109.9 |
$ 927.5 |
$ 216.2 |
||||
Segment margin |
22.2% |
17.3% |
20.0% |
20.3% |
||||
Adjusted gross profit (2) |
$ 1,471.7 |
$ 549.5 |
$ 3,874.5 |
$ 876.8 |
||||
Adjusted gross margin as a percentage of adjusted net |
80.4% |
86.5% |
83.7% |
82.5% |
||||
Adjusted SG&A as a percentage of adjusted net revenues |
27.4% |
27.4% |
27.2% |
32.6% |
||||
(1) Cost of sales excludes amortization and impairment of acquired intangibles, including product rights. |
||||||||
(2) Refer to Table 8 included in this release for the reconciliation of net revenues and cost of sales to adjusted gross profit and adjusted gross margin as a percentage of adjusted net revenues. |
||||||||
(3) Refer to Table 9 included in this release for the reconciliation of net revenues and SG&A to adjusted SG&A as a percentage of adjusted net revenues. |
North American Brands net revenue increased 188 percent to
For the full year 2014, North American Brands segment net revenue increased 336 percent to
North American Brands selling and marketing expenses increased to
North American Brands adjusted segment gross margin for the fourth quarter 2014 was 80.4 percent, compared to 86.5 percent in the fourth quarter of 2013. The decrease is largely due to the acquisition of Forest including key products with royalty payments owed as a percentage of net sales, such as the Namenda® franchise and co-promotion payments made for Linzess®.
North America Generics and International Segment Information
|
|||||||||
(unaudited; $ in millions) |
|||||||||
Three Months Ended |
Twelve Months Ended |
||||||||
December 31, |
December 31, |
||||||||
2014 |
2013 |
2014 |
2013 |
||||||
Product sales |
$ 1,760.1 |
$ 1,721.3 |
$ 6,632.7 |
$ 6,299.9 |
|||||
Other revenue |
22.6 |
39.9 |
114.5 |
118.3 |
|||||
Net revenues |
1,782.7 |
1,761.2 |
6,747.2 |
6,418.2 |
|||||
Operating expenses: |
|||||||||
Cost of sales(1) |
852.2 |
908.6 |
3,198.6 |
3,322.6 |
|||||
Selling and marketing |
176.0 |
179.9 |
679.9 |
663.4 |
|||||
General and administrative |
151.7 |
216.0 |
709.4 |
756.9 |
|||||
Segment contribution |
$ 602.8 |
$ 456.7 |
$ 2,159.3 |
$ 1,675.3 |
|||||
Segment margin |
33.8% |
25.9% |
32.0% |
26.1% |
|||||
Adjusted gross profit (2) |
$ 995.1 |
$ 894.0 |
$ 3,688.7 |
$ 3,291.4 |
|||||
Adjusted gross margin as a percentage of adjusted net |
57.2% |
50.7% |
56.5% |
51.2% |
|||||
Adjusted SG&A as a percentage of adjusted net revenues (3) |
17.3% |
20.1% |
19.4% |
19.9% |
|||||
(1) Cost of sales excludes amortization and impairment of acquired intangibles, including product rights. |
|||||||||
(2) Refer to Table 8 included in this release for the reconciliation of net revenues and cost of sales to adjusted gross profit and adjusted gross margin as a percentage of adjusted net revenues. |
|||||||||
(3) Refer to Table 9 included in this release for the reconciliation of net revenues and SG&A to adjusted SG&A as a percentage of adjusted net revenues. |
North American Generics & International net revenue increased 1 percent to
For the full year 2014, North American Generics & International net revenue increased 5 percent to
North American Generics & International selling and marketing expenses of
North American Generics & International adjusted gross margin increased to 57.2 percent in the fourth quarter of 2014 from 50.7 percent in the fourth quarter of 2013, primarily as a result of continued strength in our base business and new product launches, coupled with increased revenues resulting from the acquired Forest products sold internationally.
Anda Distribution Segment Information |
|||||||||
(unaudited; $ in millions) |
|||||||||
Three Months Ended |
Twelve Months Ended |
||||||||
December 31, |
December 31, |
||||||||
2014 |
2013 |
2014 |
2013 |
||||||
Net revenues |
$ 443.3 |
$ 383.0 |
$ 1,683.7 |
$ 1,196.9 |
|||||
Operating expenses: |
|||||||||
Cost of sales |
385.7 |
324.0 |
1,456.2 |
1,024.5 |
|||||
Selling and marketing |
29.6 |
25.8 |
112.6 |
92.1 |
|||||
General and administrative |
10.7 |
8.8 |
36.4 |
32.7 |
|||||
Segment contribution |
$ 17.3 |
$ 24.4 |
$ 78.5 |
$ 47.6 |
|||||
Segment margin |
3.9% |
6.4% |
4.7% |
4.0% |
|||||
Gross profit |
$ 57.6 |
$ 59.0 |
$ 227.5 |
$ 172.4 |
|||||
Gross margin |
13.0% |
15.4% |
13.5% |
14.4% |
|||||
SG&A as a percentage of net revenues |
9.1% |
9.0% |
8.8% |
10.4% |
Anda Distribution delivered its most successful year in its history. Net revenue for the fourth quarter 2014 increased 16 percent to
Anda Distribution segment gross margin was 13 percent in the fourth quarter of 2014 compared to 15.4 percent in the prior year period.
For the full year 2014, Anda Distribution segment net revenues increased 41 percent to
Other Operating Expenses
In fourth quarter 2014, consolidated GAAP selling, general and administrative (SG&A) expenses were
Amortization expense for the fourth quarter 2014 was
For the full year 2014, consolidated GAAP SG&A expenses were
Amortization expense for the full year 2014 was
Full Year 2015 Standalone Financial Forecast
-
Total Net Revenue is expected to be approximately
$15 billion - Non-GAAP R&D investment is expected to be approximately $1.1 billion
- Non-GAAP Effective Tax Rate is expected to be approximately 16%
- Fully Diluted Shares Outstanding are expected to be approximately 270 million
-
Non-GAAP earnings per diluted share is expected to be between
$16.30 and $17.30 - SG&A as a percent of Revenues is expected to be approximately 19%
Webcast and Conference Call Details
In-person attendance at the meeting is by invitation only. The webcast will be available live to investors and the media on the
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Cautionary Statement Regarding Forward-Looking Statements
Statements contained in this communication that refer to
Important Information for Investors and Shareholders
This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. In connection with the proposed merger between
Participants in the Merger Solicitation
The following table presents
Table 1 |
||||||||||
ACTAVIS PLC |
||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||
(Unaudited; in millions, except per share amounts) |
||||||||||
Three Months Ended |
Twelve Months Ended |
|||||||||
December 31, |
December 31, |
|||||||||
2014 |
2013 |
2014 |
2013 |
|||||||
Net revenues |
$ 4,056.9 |
$ 2,779.3 |
$ 13,062.3 |
$ 8,677.6 |
||||||
Operating expenses: |
||||||||||
Cost of sales (excludes amortization and |
1,831.3 |
1,470.6 |
6,303.8 |
4,690.7 |
||||||
Research and development |
364.6 |
184.8 |
1,085.9 |
616.9 |
||||||
Selling, general and administrative |
1,198.2 |
717.7 |
3,593.2 |
2,047.8 |
||||||
Amortization |
876.8 |
388.4 |
2,597.5 |
842.7 |
||||||
Goodwill impairment |
17.3 |
- |
17.3 |
647.5 |
||||||
In-process research and development |
103.0 |
0.5 |
424.3 |
4.9 |
||||||
Loss on assets held for sale |
178.0 |
42.7 |
190.8 |
42.7 |
||||||
Asset sales, impairments and contingent |
117.3 |
42.6 |
117.2 |
207.6 |
||||||
Total operating expenses |
4,686.5 |
2,847.3 |
14,330.0 |
9,100.8 |
||||||
Operating (loss) |
(629.6) |
(68.0) |
(1,267.7) |
(423.2) |
||||||
Non-operating income (expense): |
||||||||||
Interest income |
5.1 |
1.4 |
8.9 |
4.8 |
||||||
Interest expense |
(127.8) |
(77.7) |
(411.8) |
(239.8) |
||||||
Other income (expense), net |
(42.6) |
(2.5) |
(41.5) |
19.8 |
||||||
Total other income (expense), net |
(165.3) |
(78.8) |
(444.4) |
(215.2) |
||||||
(Loss) before income taxes and noncontrolling |
(794.9) |
(146.8) |
(1,712.1) |
(638.4) |
||||||
(Benefit) / provision for income taxes |
(62.0) |
1.7 |
(81.9) |
112.7 |
||||||
Net (loss) |
(732.9) |
(148.5) |
(1,630.2) |
(751.1) |
||||||
Loss / (income) attributable to noncontrolling |
- |
0.1 |
(0.3) |
0.7 |
||||||
Net (loss) attributable to ordinary shareholders |
$ (732.9) |
$ (148.4) |
$ (1,630.5) |
$ (750.4) |
||||||
(Loss) per share attributable to ordinary |
||||||||||
Basic |
$ (2.76) |
$ (0.86) |
$ (7.42) |
$ (5.27) |
||||||
Diluted |
$ (2.76) |
$ (0.86) |
$ (7.42) |
$ (5.27) |
||||||
Weighted average shares outstanding: |
||||||||||
Basic |
265.1 |
173.5 |
219.7 |
142.3 |
||||||
Diluted |
265.1 |
173.5 |
219.7 |
142.3 |
The following table details product revenue for significant products within the North American Brands segment for the three and twelve months ending
Table 2 |
|||||||||
ACTAVIS PLC |
|||||||||
NORTH AMERICA BRANDS SEGMENT REVENUE |
|||||||||
(Unaudited; in millions) |
|||||||||
Three Months |
Twelve Months |
||||||||
December 31, |
December 31, |
||||||||
2014 |
2013 |
2014 |
2013 |
||||||
North American Brands |
|||||||||
CNS |
|||||||||
Namenda Franchise |
$ 471.7 |
$ - |
$ 899.3 |
$ - |
|||||
Viibyrd® / Fetzima ® |
73.9 |
- |
140.3 |
- |
|||||
Saphris ® |
33.1 |
- |
69.9 |
- |
|||||
Other CNS |
25.6 |
- |
49.4 |
- |
|||||
Total CNS |
604.3 |
- |
1,158.9 |
- |
|||||
Gastroenterology |
|||||||||
Delzicol®/Asacol® HD |
145.6 |
150.2 |
564.0 |
150.2 |
|||||
Linzess®/Costella ™ |
94.4 |
- |
174.4 |
- |
|||||
Carafate ® / Sulcrate ® |
49.9 |
- |
92.2 |
- |
|||||
Canasa ® / Salofalk ® |
51.8 |
- |
86.6 |
- |
|||||
Zenpep ®, Ultrase ® & Viokace ® |
37.8 |
- |
71.9 |
- |
|||||
Other Gastroenterology |
9.0 |
- |
17.5 |
- |
|||||
Total Gastroenterology |
388.5 |
150.2 |
1,006.6 |
150.2 |
|||||
Women's Health |
|||||||||
Lo Loestrin® Fe |
75.1 |
63.3 |
277.1 |
63.3 |
|||||
Minastrin® 24 Fe |
59.5 |
55.7 |
217.9 |
55.7 |
|||||
Estrace® Cream |
80.3 |
60.7 |
258.2 |
60.7 |
|||||
Other Women's Health |
52.5 |
44.9 |
199.0 |
113.1 |
|||||
Total Women's Health |
267.4 |
224.6 |
952.2 |
292.8 |
|||||
Cardiovascular, Respiratory & Acute Care |
|||||||||
Bystolic® |
154.0 |
- |
292.6 |
- |
|||||
Daliresp ® |
31.7 |
- |
61.7 |
- |
|||||
Tudorza ® |
30.2 |
- |
58.6 |
- |
|||||
Total Cardiovascular, Respiratory & Acute Care |
215.9 |
- |
412.9 |
- |
|||||
Urology |
75.9 |
86.0 |
289.2 |
258.6 |
|||||
Infectious Disease |
36.0 |
- |
56.2 |
- |
|||||
Dermatology/Established Brands |
242.9 |
174.3 |
755.4 |
360.9 |
|||||
Total North American Brands |
$ 1,830.9 |
$ 635.1 |
$ 4,631.4 |
$ 1,062.5 |
|||||
The following table presents
Table 3 |
||||||||||||
ACTAVIS PLC |
||||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||||||||
(Unaudited; in millions) |
||||||||||||
December 31, |
December 31, |
|||||||||||
2014 |
2013 |
|||||||||||
Assets |
||||||||||||
Cash and cash equivalents |
$ 250.0 |
$ 329.0 |
||||||||||
Marketable securities |
1.0 |
2.5 |
||||||||||
Accounts receivable, net |
2,372.3 |
1,404.9 |
||||||||||
Inventories |
2,075.5 |
1,786.3 |
||||||||||
Other current assets |
1,233.7 |
641.0 |
||||||||||
Assets held for sale |
949.2 |
271.0 |
||||||||||
Property, plant and equipment, net |
1,594.7 |
1,616.8 |
||||||||||
Investments and other assets |
342.8 |
242.3 |
||||||||||
Product rights and other intangibles, net |
19,188.4 |
8,234.5 |
||||||||||
Goodwill |
24,521.5 |
8,197.6 |
||||||||||
Total assets |
$ 52,529.1 |
$ 22,725.9 |
||||||||||
Liabilities & Equity |
||||||||||||
Current liabilities (excluding held for sale) |
$ 4,992.7 |
$ 3,048.3 |
||||||||||
Liabilities held for sale |
25.9 |
246.6 |
||||||||||
Long-term debt and capital leases |
14,846.3 |
8,517.4 |
||||||||||
Deferred income taxes and other liabilities |
4,328.7 |
1,376.5 |
||||||||||
Total equity |
28,335.5 |
9,537.1 |
||||||||||
Total liabilities and equity |
$ 52,529.1 |
$ 22,725.9 |
||||||||||
The following table presents
Table 4 |
||||||||||||
ACTAVIS PLC |
||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||||||
(Unaudited; In millions) |
||||||||||||
There Months Ended December |
Years Ended December 31, |
|||||||||||
2014 |
2013 |
2014 |
2013 |
|||||||||
Cash Flows From Operating Activities: |
||||||||||||
Net (loss) |
$ (732.9) |
$ (148.5) |
$(1,630.2) |
$ (751.1) |
||||||||
Reconciliation to net cash provided by operating activities: |
||||||||||||
Depreciation |
61.2 |
54.3 |
230.9 |
202.0 |
||||||||
Amortization |
876.8 |
388.4 |
2,597.5 |
842.7 |
||||||||
Provision for inventory reserve |
45.9 |
63.3 |
156.1 |
113.8 |
||||||||
Share-based compensation |
108.6 |
57.8 |
368.0 |
133.6 |
||||||||
Deferred income tax benefit |
(277.6) |
(105.0) |
(690.1) |
(275.0) |
||||||||
(Earnings) loss on equity method investments |
(3.8) |
(2.4) |
(6.1) |
(5.7) |
||||||||
Gain on sale of securities |
- |
- |
(4.3) |
- |
||||||||
Goodwill impairment |
17.3 |
- |
17.3 |
647.5 |
||||||||
In-process research and development impairments |
103.0 |
0.5 |
424.3 |
4.9 |
||||||||
Loss / (gain) on asset sale and impairment, net |
117.3 |
31.8 |
143.1 |
55.9 |
||||||||
Amortization of inventory step up |
282.5 |
173.5 |
985.8 |
267.0 |
||||||||
Amortization of deferred financing costs |
52.8 |
4.6 |
87.2 |
10.3 |
||||||||
Increase / (decrease) in allowance for doubtful |
1.6 |
0.2 |
11.9 |
(0.3) |
||||||||
Accretion of preferred stock and contingent payment |
7.1 |
4.9 |
20.7 |
11.4 |
||||||||
Contingent consideration fair value adjustment |
(54.1) |
(7.6) |
(91.9) |
148.6 |
||||||||
Non-cash impact of debt extinguishment |
- |
- |
(91.7) |
- |
||||||||
Excess tax benefit from stock-based compensation |
(28.4) |
0.2 |
(51.1) |
(69.0) |
||||||||
Impact of assets held for sale |
178.0 |
42.7 |
190.8 |
42.7 |
||||||||
Other, net |
33.9 |
(4.5) |
6.7 |
(2.2) |
||||||||
Changes in assets and liabilities (net of effects of |
- |
- |
||||||||||
Decrease / (increase) in accounts receivable, net |
(245.5) |
47.8 |
(611.1) |
19.1 |
||||||||
Decrease / (increase) in inventories |
59.5 |
53.4 |
(207.2) |
(213.1) |
||||||||
Decrease / (increase) in prepaid expenses and |
(39.9) |
(12.1) |
29.4 |
49.9 |
||||||||
Increase / (decrease) in accounts payable and |
124.2 |
(39.9) |
416.5 |
(20.4) |
||||||||
Increase / (decrease) in deferred revenue |
(10.7) |
4.5 |
(21.9) |
28.2 |
||||||||
Increase / (decrease) in income and other taxes |
170.6 |
79.3 |
29.7 |
7.4 |
||||||||
Increase / (decrease) in other assets and |
(35.8) |
(35.5) |
(67.3) |
(34.7) |
||||||||
Total adjustments |
1,544.5 |
800.2 |
3,873.2 |
1,964.6 |
||||||||
Net cash provided by operating |
811.6 |
651.7 |
2,243.0 |
1,213.5 |
||||||||
Cash Flows From Investing Activities: |
||||||||||||
Additions to property, plant and equipment |
(64.5) |
(60.5) |
(238.6) |
(177.9) |
||||||||
Additions to product rights and other intangibles |
(36.0) |
(125.0) |
(36.1) |
(130.0) |
||||||||
Additions to marketable securities and other investments |
- |
- |
(1.0) |
- |
||||||||
Proceeds from sales of property, plant and equipment |
1.7 |
1.2 |
13.7 |
7.1 |
||||||||
Proceeds from sales of marketable securities and other |
- |
8.2 |
12.0 |
33.2 |
||||||||
Proceeds from sales of assets |
- |
4.5 |
441.7 |
4.5 |
||||||||
Acquisitions of business, net of cash acquired |
(639.7) |
179.5 |
(5,562.3) |
(15.1) |
||||||||
Other investing activities, net |
- |
2.9 |
- |
2.9 |
||||||||
Net cash (used in/provided by) |
(738.5) |
10.8 |
(5,370.6) |
(275.3) |
||||||||
Cash Flows From Financing Activities: |
||||||||||||
Proceeds from borrowings of long-term indebtedness |
- |
1,757.3 |
8,076.2 |
1,882.3 |
||||||||
Proceeds from borrowings on credit facility |
1,200.0 |
555.0 |
1,280.0 |
555.0 |
||||||||
Debt issuance and other financing costs |
(166.1) |
(6.9) |
(224.3) |
(7.4) |
||||||||
Payments on debt, including capital lease obligations |
(1,251.5) |
(2,968.9) |
(6,127.0) |
(3,229.5) |
||||||||
Proceeds from stock plans |
62.6 |
4.0 |
105.9 |
48.0 |
||||||||
Payments of contingent consideration |
(1.7) |
(1.2) |
(14.3) |
(4.3) |
||||||||
Repurchase of ordinary shares |
(30.4) |
(4.6) |
(130.1) |
(170.0) |
||||||||
Acquisition of noncontrolling interest |
- |
- |
- |
(10.4) |
||||||||
Excess tax benefit from stock-based compensation |
28.4 |
(0.2) |
51.1 |
69.0 |
||||||||
Net cash (used in) / provided |
(158.7) |
(665.5) |
3,017.5 |
(867.3) |
||||||||
Effect of currency exchange rate changes on cash and cash |
(3.8) |
1.0 |
(5.9) |
(23.9) |
||||||||
Movement in cash held for sale |
- |
(37.0) |
37.0 |
(37.0) |
||||||||
Net (decrease) / increase in |
(89.4) |
(39.0) |
(79.0) |
10.0 |
||||||||
Cash and cash equivalents at beginning of period |
339.4 |
368.0 |
329.0 |
319.0 |
||||||||
Cash and cash equivalents at end of period |
$ 250.0 |
$ 329.0 |
$ 250.0 |
$ 329.0 |
The following table presents a reconciliation of reported net (loss) and diluted earnings per share to non-GAAP net income and diluted earnings per share for the three months and twelve months ended
Table 5 |
||||||||
ACTAVIS PLC |
||||||||
RECONCILIATION TABLE |
||||||||
(Unaudited; in millions except per share amounts) |
||||||||
Three Months Ended |
Twelve Months Ended |
|||||||
December 31, |
December 31, |
|||||||
2014 |
2013 |
2014 |
2013 |
|||||
GAAP to non-GAAP net income calculation |
||||||||
Reported GAAP net (loss) attributable to |
$ (732.9) |
$ (148.4) |
$ (1,630.5) |
$ (750.4) |
||||
Adjusted for: |
||||||||
Amortization |
876.8 |
388.4 |
2,597.5 |
842.7 |
||||
Global supply chain initiative(1) |
15.5 |
17.9 |
54.1 |
68.4 |
||||
Acquisition and licensing charges (2) |
571.9 |
317.5 |
1,789.0 |
697.8 |
||||
Accretion on contingent liabilities |
7.3 |
4.5 |
20.8 |
11.0 |
||||
Impairment/asset sales and related costs |
380.3 |
82.5 |
706.4 |
749.1 |
||||
Non-recurring losses (gains) |
- |
16.5 |
84.5 |
14.6 |
||||
Legal settlements |
176.0 |
1.9 |
167.5 |
47.7 |
||||
Income taxes on items above |
(244.3) |
(126.1) |
(676.6) |
(308.6) |
||||
Non-GAAP net income attributable to |
$ 1,050.6 |
$ 554.7 |
$ 3,112.7 |
$ 1,372.3 |
||||
Diluted earnings per share |
||||||||
Diluted (loss) earnings per share - GAAP |
$ (2.76) |
$ (0.86) |
$ (7.42) |
$ (5.27) |
||||
Diluted earnings per share - Non-GAAP |
$ 3.91 |
$ 3.17 |
$ 13.98 |
$ 9.50 |
||||
Basic weighted average common shares outstanding |
265.1 |
173.5 |
219.7 |
142.3 |
||||
Effect of dilutive securities: |
||||||||
Dilutive shares |
3.4 |
1.4 |
3.0 |
2.1 |
||||
Diluted weighted average common shares outstanding |
268.5 |
174.9 |
222.7 |
144.4 |
||||
(1) |
Includes accelerated depreciation charges. |
|||||||
(2) |
Includes stock-based compensation due to the Warner Chilcott, Furiex, Durata and Forest acquisitions. |
The following table presents a reconciliation of reported net (loss) for the three and twelve months ended
Table 6 |
|||||||||
ACTAVIS PLC |
|||||||||
ADJUSTED EBITDA, RECONCILIATION TABLE |
|||||||||
(Unaudited; in millions) |
|||||||||
Three Months Ended |
Twelve Months Ended |
||||||||
December 31, |
December 31, |
||||||||
2014 |
2013 |
2014 |
2013 |
||||||
GAAP net (loss) attributable to ordinary shareholders |
$ (732.9) |
$ (148.4) |
$ (1,630.5) |
$ (750.4) |
|||||
Plus: |
|||||||||
Interest expense |
127.8 |
77.7 |
411.8 |
239.8 |
|||||
Interest income |
(5.1) |
(1.4) |
(8.9) |
(4.8) |
|||||
(Benefit) / provision for income taxes |
(62.0) |
1.7 |
(81.9) |
112.7 |
|||||
Depreciation (includes accelerated depreciation) |
61.2 |
54.3 |
230.9 |
202.0 |
|||||
Amortization |
876.8 |
388.4 |
2,597.5 |
842.7 |
|||||
EBITDA |
265.8 |
372.3 |
1,518.9 |
642.0 |
|||||
Adjusted for: |
|||||||||
Global supply chain initiative |
13.8 |
9.5 |
38.6 |
32.2 |
|||||
Acquisition and licensing and other charges |
505.1 |
272.1 |
1,519.3 |
614.2 |
|||||
Impairment/asset sales and related costs |
380.3 |
82.5 |
706.4 |
749.1 |
|||||
Non-recurring losses (gains) |
- |
16.5 |
84.5 |
14.6 |
|||||
Legal settlements |
176.0 |
1.9 |
167.5 |
47.7 |
|||||
Accretion on contingent liabilities |
7.3 |
4.5 |
20.8 |
11.0 |
|||||
Share-based compensation |
124.7 |
57.8 |
400.7 |
133.6 |
|||||
Adjusted EBITDA |
$ 1,473.0 |
$ 817.1 |
$ 4,456.7 |
$ 2,244.4 |
The following table presents a reconciliation of expected adjusted earnings per share with expected GAAP earnings per share for the twelve months ending December 31, 2015:
Table 7 |
|||||
(Unaudited; $ in millions) |
Twelve Months Ending December 31, 2015 |
||||
GAAP to non-GAAP net income calculation |
Low |
High |
|||
Reported GAAP net income attributable to ordinary shareholders |
$ 1,373.2 |
$ 1,644.4 |
|||
Adjusted for: |
|||||
Amortization |
3,040.3 |
3,040.3 |
|||
Global supply chain initiative (1) |
5.0 |
5.0 |
|||
Acquisition and licensing charges (2) |
420.4 |
420.4 |
|||
Accretion on contingent liabilities |
25.5 |
25.5 |
|||
Impairment/asset sales and related costs |
(20.0) |
(20.0) |
|||
Non-recurring losses (gains) |
- |
- |
|||
Legal settlements |
- |
- |
|||
Income taxes on items above |
(438.9) |
(438.9) |
|||
Non-GAAP net income attributable to |
$ 4,405.5 |
$ 4,676.7 |
|||
Diluted earnings per share |
|||||
Diluted earnings per share - GAAP |
$ 5.08 |
$ 6.08 |
|||
Diluted earnings per share - Non-GAAP |
$ 16.30 |
$ 17.30 |
|||
Basic weighted average ordinary shares outstanding |
266.0 |
266.0 |
|||
Effect of dilutive securities: |
|||||
Dilutive share-based compensation arrangements |
4.3 |
4.3 |
|||
Diluted weighted average ordinary shares outstanding |
270.3 |
270.3 |
|||
(1) |
Includes accelerated depreciation charges. |
||||
(2) |
Includes fair value step-up of stock-based compensation. |
The following table presents a reconciliation of reported net revenues and cost of sales by segment for the three and twelve months ended
Table 8 |
|||||||||||||||||||
ACTAVIS PLC |
|||||||||||||||||||
ADJUSTED GROSS MARGIN AS A PERCENTAGE OF ADJUSTED NET REVENUES |
|||||||||||||||||||
Three Months Ended |
Three Months Ended |
||||||||||||||||||
December 31, 2014 |
December 31, 2013 |
||||||||||||||||||
(Unaudited; $ in millions) |
North |
North |
Anda |
Total |
North |
North |
Anda |
Total |
|||||||||||
Net Revenues: |
|||||||||||||||||||
Net revenues |
$ 1,830.9 |
$ 1,782.7 |
$ 443.3 |
$4,056.9 |
$ 635.1 |
$ 1,761.2 |
$ 383.0 |
$2,779.3 |
|||||||||||
Adjustments to net revenue ((remove from) / add to) |
|||||||||||||||||||
Purchase accounting adjustments |
- |
6.1 |
- |
6.1 |
- |
0.4 |
- |
0.4 |
|||||||||||
Operating results of assets held for sale / sold |
- |
(48.1) |
- |
(48.1) |
- |
- |
- |
- |
|||||||||||
Manufacturing and supply contract |
- |
- |
- |
- |
- |
- |
- |
- |
|||||||||||
Adjusted net revenues |
$ 1,830.9 |
$ 1,740.7 |
$ 443.3 |
$4,014.9 |
$ 635.1 |
$ 1,761.6 |
$ 383.0 |
$2,779.7 |
|||||||||||
Cost of Sales (1): |
|||||||||||||||||||
Cost of Sales |
$ 593.4 |
$ 852.2 |
$ 385.7 |
$1,831.3 |
$ 238.0 |
$ 908.6 |
$ 324.0 |
$1,470.6 |
|||||||||||
Adjustments to cost of sales ((remove from) / add |
|||||||||||||||||||
Integration and restructuring |
(4.4) |
1.0 |
- |
(3.4) |
- |
(2.3) |
- |
(2.3) |
|||||||||||
Contingent consideration fair value and |
12.0 |
- |
- |
12.0 |
(0.3) |
(0.9) |
- |
(1.2) |
|||||||||||
Operating results of assets held for sale / sold |
- |
(49.8) |
- |
(49.8) |
- |
(0.8) |
- |
(0.8) |
|||||||||||
Operational Excellence Initiative |
- |
(15.2) |
- |
(15.2) |
- |
(15.9) |
- |
(15.9) |
|||||||||||
Acquisition accounting fair market value |
(1.9) |
- |
- |
(1.9) |
- |
- |
- |
- |
|||||||||||
Purchase accounting adjustments |
(239.9) |
(42.6) |
- |
(282.5) |
(152.1) |
(21.1) |
- |
(173.2) |
|||||||||||
Adjusted cost of sales |
$ 359.2 |
$ 745.6 |
$ 385.7 |
$1,490.5 |
$ 85.6 |
$ 867.6 |
$ 324.0 |
$1,277.2 |
|||||||||||
Adjusted gross profit |
1,471.7 |
995.1 |
57.6 |
2,524.4 |
549.5 |
894.0 |
59.0 |
1,502.5 |
|||||||||||
Adjusted gross margin as a percentage of |
80.4% |
57.2% |
13.0% |
62.9% |
86.5% |
50.7% |
15.4% |
54.1% |
|||||||||||
(1) Cost of sales excludes amortization and impairment of acquired intangibles, including product rights. |
|||||||||||||||||||
Year Ended |
Year Ended |
||||||||||||||||||
December 31, 2014 |
December 31, 2013 |
||||||||||||||||||
(Unaudited; $ in millions) |
North |
North |
Anda |
Total |
North |
North |
Anda |
Total |
|||||||||||
Net Revenues: |
|||||||||||||||||||
Net revenues |
$ 4,631.4 |
$ 6,747.2 |
$ 1,683.7 |
$13,062.3 |
$ 1,062.5 |
$ 6,418.2 |
$ 1,196.9 |
$8,677.6 |
|||||||||||
Adjustments to net revenue ((remove from) / add to) |
|||||||||||||||||||
Purchase accounting |
- |
16.4 |
- |
16.4 |
0.4 |
6.3 |
- |
6.7 |
|||||||||||
Operating results of assets held |
- |
(231.9) |
- |
(231.9) |
- |
- |
- |
- |
|||||||||||
Manufacturing and supply |
- |
- |
- |
- |
- |
5.0 |
- |
5.0 |
|||||||||||
Adjusted net revenues |
$ 4,631.4 |
$ 6,531.7 |
$ 1,683.7 |
$12,846.8 |
$ 1,062.9 |
$ 6,429.5 |
$ 1,196.9 |
$8,689.3 |
|||||||||||
Cost of Sales (1): |
|||||||||||||||||||
Cost of Sales |
$ 1,649.0 |
$ 3,198.6 |
$ 1,456.2 |
$6,303.8 |
$ 343.6 |
$ 3,322.6 |
$ 1,024.5 |
$4,690.7 |
|||||||||||
Adjustments to cost of sales ((remove from) / add |
|||||||||||||||||||
Integration and restructuring |
(18.4) |
1.3 |
- |
(17.1) |
- |
(6.1) |
- |
(6.1) |
|||||||||||
Contingent consideration fair |
9.9 |
(6.0) |
- |
3.9 |
(5.4) |
(2.3) |
- |
(7.7) |
|||||||||||
Operating results of assets held |
- |
(194.4) |
- |
(194.4) |
- |
(0.8) |
- |
(0.8) |
|||||||||||
Operational Excellence |
- |
(45.9) |
- |
(45.9) |
- |
(60.7) |
- |
(60.7) |
|||||||||||
Acquisition accounting fair |
(7.8) |
- |
- |
(7.8) |
- |
- |
- |
- |
|||||||||||
Purchase accounting |
(875.8) |
(110.6) |
- |
(986.4) |
(152.1) |
(114.6) |
- |
(266.7) |
|||||||||||
Adjusted cost of sales |
$ 756.9 |
$ 2,843.0 |
$ 1,456.2 |
$5,056.1 |
$ 186.1 |
$ 3,138.1 |
$ 1,024.5 |
$4,348.7 |
|||||||||||
Adjusted gross profit |
3,874.5 |
3,688.7 |
227.5 |
7,790.7 |
876.8 |
3,291.4 |
172.4 |
4,340.6 |
|||||||||||
Adjusted gross margin as a percentage of |
83.7% |
56.5% |
13.5% |
60.6% |
82.5% |
51.2% |
14.4% |
50.0% |
|||||||||||
(1) Cost of sales excludes amortization and impairment of acquired intangibles, including product rights. |
The following table presents a reconciliation of reported net revenues and SG&A by segment for the three and twelve months ended
Table 9 |
|||||||||||||||||
ACTAVIS PLC |
|||||||||||||||||
ADJUSTED SG&A AS A PERCENTAGE OF ADJUSTED NET REVENUES |
|||||||||||||||||
Three Months Ended |
Three Months Ended |
||||||||||||||||
December 31, 2014 |
December 31, 2013 |
||||||||||||||||
(Unaudited; $ in millions) |
North |
North |
Anda |
Total |
North |
North |
Anda |
Total |
|||||||||
Net Revenues: |
|||||||||||||||||
Net revenues |
$ 1,830.9 |
$ 1,782.7 |
$ 443.3 |
$4,056.9 |
$ 635.1 |
$ 1,761.2 |
$ 383.0 |
$2,779.3 |
|||||||||
Adjustments to net revenue ((remove from) / |
|||||||||||||||||
Purchase accounting adjustments |
- |
6.1 |
- |
6.1 |
- |
0.4 |
- |
0.4 |
|||||||||
Operating results of assets held for sale / |
- |
(48.1) |
- |
(48.1) |
- |
- |
- |
- |
|||||||||
Manufacturing and supply contract |
- |
- |
- |
- |
- |
- |
- |
- |
|||||||||
Adjusted net revenues |
$ 1,830.9 |
$ 1,740.7 |
$ 443.3 |
$4,014.9 |
$ 635.1 |
$ 1,761.6 |
$ 383.0 |
$2,779.7 |
|||||||||
SG&A: |
|||||||||||||||||
SG&A |
$ 830.2 |
$ 327.7 |
$ 40.3 |
$1,198.2 |
$ 287.2 |
$ 395.9 |
$ 34.6 |
$717.7 |
|||||||||
Adjustments to SG&A ((remove from) / add |
|||||||||||||||||
Legal matters |
(176.0) |
- |
- |
(176.0) |
- |
(1.9) |
- |
(1.9) |
|||||||||
Acquisition, integration & restructuring |
(36.7) |
(22.9) |
- |
(59.6) |
(113.4) |
(36.0) |
- |
(149.4) |
|||||||||
Acquisition related costs |
(30.9) |
(3.0) |
- |
(33.9) |
- |
- |
- |
- |
|||||||||
U.S. Branded Pharma fee |
- |
- |
- |
- |
- |
- |
- |
- |
|||||||||
Other |
- |
- |
- |
- |
- |
- |
- |
- |
|||||||||
Global supply chain initiative accelerated |
- |
- |
- |
- |
- |
(1.0) |
- |
(1.0) |
|||||||||
Contract termination payments |
(38.9) |
- |
- |
(38.9) |
- |
- |
- |
- |
|||||||||
Operating results for assets held for sale / |
- |
- |
- |
- |
- |
- |
- |
- |
|||||||||
Acquisition accounting fair market value |
(46.1) |
- |
- |
(46.1) |
- |
- |
- |
- |
|||||||||
Costs associated with holding assets out for |
- |
- |
- |
- |
- |
(2.5) |
- |
(2.5) |
|||||||||
Adjusted SG&A |
$ 501.6 |
$ 301.8 |
$ 40.3 |
$843.7 |
$ 173.8 |
$ 354.5 |
$ 34.6 |
$562.9 |
|||||||||
Adjusted SG&A as a percentage of adjusted |
27.4% |
17.3% |
9.1% |
21.0% |
27.4% |
20.1% |
9.0% |
20.3% |
|||||||||
Year Ended |
Year Ended |
||||||||||||||||
December 31, 2014 |
December 31, 2013 |
||||||||||||||||
(Unaudited; $ in millions) |
North |
North |
Anda |
Total |
North |
North |
Anda |
Total |
|||||||||
Net Revenues: |
|||||||||||||||||
Net revenues |
$ 4,631.4 |
$ 6,747.2 |
$ 1,683.7 |
$13,062.3 |
$ 1,062.5 |
$ 6,418.2 |
$ 1,196.9 |
$8,677.6 |
|||||||||
Adjustments to net revenue ((remove from) / |
|||||||||||||||||
Purchase accounting adjustments |
- |
16.4 |
- |
16.4 |
0.4 |
6.3 |
- |
6.7 |
|||||||||
Operating results of assets held for sale / |
- |
(231.9) |
- |
(231.9) |
- |
- |
- |
- |
|||||||||
Manufacturing and supply contract |
- |
- |
- |
- |
- |
5.0 |
- |
5.0 |
|||||||||
Adjusted net revenues |
$ 4,631.4 |
$ 6,531.7 |
$ 1,683.7 |
$12,846.8 |
$ 1,062.9 |
$ 6,429.5 |
$ 1,196.9 |
$8,689.3 |
|||||||||
SG&A: |
|||||||||||||||||
SG&A |
$ 2,054.9 |
$ 1,389.3 |
$ 149.0 |
$3,593.2 |
$ 502.7 |
$ 1,420.3 |
$ 124.8 |
$2,047.8 |
|||||||||
Adjustments to SG&A ((remove from) / add |
|||||||||||||||||
Legal matters |
(168.5) |
1.0 |
- |
(167.5) |
- |
(47.7) |
- |
(47.7) |
|||||||||
Acquisition, integration & restructuring |
(167.4) |
(55.0) |
- |
(222.4) |
(136.0) |
(66.3) |
- |
(202.3) |
|||||||||
Acquisition related expenses |
(99.1) |
(15.8) |
- |
(114.9) |
(20.7) |
(20.6) |
- |
(41.3) |
|||||||||
U.S. Branded Pharma fee |
(105.0) |
(10.8) |
- |
(115.8) |
- |
- |
- |
- |
|||||||||
Other |
- |
1.4 |
- |
1.4 |
- |
- |
- |
- |
|||||||||
Global supply chain initiative accelerated |
- |
(6.4) |
- |
(6.4) |
- |
(3.8) |
- |
(3.8) |
|||||||||
Contract termination payments |
(48.9) |
- |
- |
(48.9) |
- |
- |
- |
- |
|||||||||
Operating results for assets held for sale / |
- |
(33.5) |
- |
(33.5) |
- |
- |
- |
- |
|||||||||
Acquisition accounting fair market value |
(207.8) |
- |
- |
(207.8) |
- |
- |
- |
- |
|||||||||
Costs associated with holding assets out for |
- |
(5.7) |
- |
(5.7) |
- |
(2.5) |
- |
(2.5) |
|||||||||
Adjusted SG&A |
$ 1,258.2 |
$ 1,264.5 |
$ 149.0 |
$2,671.7 |
$ 346.0 |
$ 1,279.4 |
$ 124.8 |
$1,750.2 |
|||||||||
Adjusted SG&A as a percentage of adjusted |
27.2% |
19.4% |
8.8% |
20.8% |
32.6% |
19.9% |
10.4% |
20.1% |
|||||||||
The following table presents a reconciliation of expected
Table 10 |
|||||||||||||||||
ACTAVIS PLC |
|||||||||||||||||
ADJUSTED R&D EXPENSE |
|||||||||||||||||
Three Months Ended December 31, 2014 |
Year Ended December 31, 2014 |
||||||||||||||||
(Unaudited; $ in millions) |
Generic |
Brand |
Biosimilar |
Total |
Generic |
Brand |
Biosimilar |
Total |
|||||||||
Research and Development expense |
$ 121.4 |
$ 221.5 |
$ 21.7 |
$ 364.6 |
$ 474.9 |
$ 512.1 |
$ 98.9 |
$1,085.9 |
|||||||||
Adjustments to research and development ((remove from) / add |
|||||||||||||||||
Contingent consideration fair value adjustments |
(0.4) |
23.6 |
- |
23.2 |
(0.4) |
42.9 |
- |
42.5 |
|||||||||
Write-off of contingent consideration |
- |
16.0 |
- |
16.0 |
- |
40.7 |
- |
40.7 |
|||||||||
Accretion expense |
- |
(3.9) |
- |
(3.9) |
- |
(15.3) |
- |
(15.3) |
|||||||||
Operating results for assets held for sale |
- |
- |
- |
- |
(2.7) |
- |
- |
(2.7) |
|||||||||
Brand related milestone payments and upfront option payments |
(1.8) |
(48.1) |
- |
(49.9) |
(1.8) |
(65.2) |
- |
(67.0) |
|||||||||
Accelerated depreciation and product transfer costs |
(0.3) |
- |
- |
(0.3) |
(1.8) |
- |
- |
(1.8) |
|||||||||
Acquisition, integration & restructuring expenses |
- |
(7.9) |
- |
(7.9) |
(1.7) |
(26.4) |
- |
(28.1) |
|||||||||
Acquisition accounting fair market value adjustment to stock- |
(1.8) |
(18.9) |
- |
(20.7) |
(1.8) |
(65.0) |
- |
(66.8) |
|||||||||
Acquisition related settlements |
- |
- |
- |
- |
- |
(0.3) |
- |
(0.3) |
|||||||||
Adjusted research and development expense |
$ 117.1 |
$ 182.3 |
$ 21.7 |
$ 321.1 |
$ 464.7 |
$ 423.5 |
$ 98.9 |
$ 987.1 |
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