LAVAL, Quebec, Feb. 28, 2017 /PRNewswire/ -- Valeant
Pharmaceuticals International, Inc. (NYSE: VRX) (TSX: VRX)
("Valeant" or the "Company" or "We") today announced fourth quarter
and full year 2016 financial results.
"Today, we announced financial results that delivered on
expectations and demonstrated our commitment to creating the new
Valeant," said Joseph C. Papa, Chairman and Chief Executive
Officer. "Over the past few months, our teams worked to stabilize
and strengthen our core businesses, resolve legacy issues, improve
operational processes, launch new products, and improve the balance
sheet and capital structure. We paid all 2017 amortizations and
reduced debt by $519 million in the
fourth quarter. We agreed to divest a number of assets, including
several skincare brands, our Dendreon business and smaller
international interests. The U.S. Food and Drug Administration
(FDA) approved our new psoriasis treatment, SILIQ™, and we
resubmitted our glaucoma treatment, latanoprostene bunod in
February 2017.
"Bill Humphries recently joined
our Dermatology business as Executive Vice President and we believe
he has the talent and experience to grow the business. With our
Walgreens fulfillment arrangement, we continue to see improvements
in average sales prices (ASP) that are encouraging to us. We have
worked to stabilize our sales force, while also expanding it to
include primary care physicians to help us reach patients whose
lives we believe can be improved with our healthcare products. We
are pleased to report that the remediation at the Bausch + Lomb
manufacturing site in Tampa was
recently completed. Now, more than ever, we believe that with the
right people, products and processes in place, we are well poised
for a turnaround in 2017; we have a lot to look forward to and are
excited about the future."
Total Revenues
Total Revenues in the fourth quarter of 2016 were $2,403 million as compared to $2,758 million in the fourth quarter of 2015,
reflecting a decline of 13%. The decrease was primarily driven by a
reduction in product sales from the existing business (excluding
effects from acquisitions, foreign currency and divestitures and
discontinuations) of $310 million and
the negative impact of foreign currency exchange of $43 million, most notably from the Egyptian
pound, which was significantly devalued in November 2016.
Revenues in the quarter were further impacted by a drop in realized
pricing by 3%, along with divestitures and discontinuations of
$16 million. These declines were
partially offset by incremental product sales of $13 million from acquisitions.
Total Revenues for the full year 2016 were $9,674 million as compared to $10,447 million for 2015, reflecting a decrease
of 7%. The decrease was primarily driven by a decline in
product sales from our existing business (excluding effects from
acquisitions, foreign currency and divestitures and
discontinuations) of $1,277 million,
the unfavorable impact of foreign currencies on our existing
business of $137 million, the impact
of divestitures and discontinuations of $80
million, and a decline in other revenues of $15 million. These decreases were offset by
incremental product sales of $735
million from acquisitions.
Segment Revenues
The Bausch + Lomb / International Segment
The Bausch + Lomb/International segment reported fourth
quarter 2016 revenues of $1,176
million as compared to $1,187
million in the fourth quarter of 2015. Fourth quarter
results reflected incremental revenue gains and slight volume
increases from the U.S. Consumer business and Asia Pacific region that were offset by
declines in other business units within the segment, as well as by
the negative impact of foreign exchange.
Full year 2016 revenues in the Bausch +
Lomb/International segment were $4,607
million as compared to $4,603
million for 2015. The segment, which contributed 48% of
total company revenues in 2016, reflected product sales of
$239 million from acquisitions in
2015, a net increase in product sales revenue from our existing
businesses (excluding effects from acquisitions, foreign currency,
and divestitures and discontinuations), driven by volume of
$31 million.
Increased volumes driven by gains in U.S. Consumer and
China were partially offset by
declines in Europe resulting from
our targeted inventory reductions in Poland and Russia.
During 2016, the segment was also impacted by the unfavorable
impact of foreign currencies of $126
million, a net decrease in product sales revenue from our
existing business driven by a decrease in average realized pricing
of $98 million and a negative impact
from divestitures and discontinuations of $36 million.
The Branded Rx Segment
The Branded Rx segment delivered fourth quarter 2016
revenues of $829 million as compared
to $1,002 million in the fourth
quarter of 2015. The shortfall in quarterly revenues as compared to
the same period in the prior year was due to declines driven mainly
by our Salix and Dermatology business. Results in the quarter also
reflected lower average realized pricing impacted by managed care
rebates, and increased generic competition.
Full year 2016 revenues in the Branded Rx segment were
$3,148 million as compared to
$3,582 million for 2015. The segment,
which contributed 33% of total company revenues in 2016, reflected
a decline in product sales revenue from our existing business,
driven by a decrease in average realized pricing of $431 million and a decrease in volume of
$357 million. These factors were
partially offset by product revenues of $383
million from acquisitions in 2015, primarily the acquisition
of Salix Pharmaceuticals, Ltd. (the "Salix Acquisition") and the
acquisition of certain assets of Dendreon Corporation.
The decrease in average realized pricing was primarily
attributable to higher managed care rebates and lower price
appreciation credits particularly in the Dermatology and Salix
businesses, and the fulfillment arrangement with Walgreens. The
decrease in volumes was driven by the Dermatology business, most
notably by Jublia®, Solodyn® and Ziana®, which have experienced
lower volumes since the change in our fulfillment model.
Generic competition was also a factor in volume declines as certain
products lost exclusivity, such as Glumetza® and Zegerid® in our
Salix business unit and Ziana® in our Dermatology business
unit.
During 2016, the segment was also impacted by a decrease
associated with divestitures and discontinuations of $22 million and the unfavorable impact of foreign
currencies on our existing Canadian business of $11 million.
The U.S. Diversified Products Segment
The U.S. Diversified Products segment reported
fourth quarter 2016 revenues of $398
million as compared to $568
million in the fourth quarter of 2015. The shortfall
in quarterly revenues as compared to the prior year was primarily
driven by lower volumes in Neurology. Results in the quarter also
reflected declines in average realized pricing as a result of
higher managed care rebates, as well as increased generic
competition.
Full year 2016 revenues for the U.S. Diversified
Products segment were $1,919
million as compared to $2,262
million for 2015. The segment, which contributed 19% of
total company revenues in 2016, reflected a decline in product
sales revenue from our existing business of $422 million, primarily driven by a decrease in
volume of $299 million, and a
decrease in average realized pricing of $123
million. These factors were partially offset by incremental
product sales revenue in 2016, related to the 2015 acquisition of
certain assets of Marathon Pharmaceuticals, LLC (mainly driven by
Isuprel® and Nitropress® product sales) and other acquisitions of
$113 million.
The decrease in volume was mainly driven by generic competition
to our Neurology products (Xenazine®, Mestinon®, Ammonul® and
Sodium Edecrin®). The decrease in average realized pricing
was attributable to our Neurology products and is the result
of higher managed care rebates, lower price appreciation credits,
and higher group purchasing organization chargebacks on Nitropress®
and Isuprel®. The segment was also affected by a decrease in
contribution associated with divestitures and discontinuations of
$22 million.
Operating Expenses
Cost of Goods Sold (COGS)
Total GAAP COGS was $665 million
for the fourth quarter 2016 as compared to $730 million in the fourth quarter of 2015. Full
year 2016 total GAAP COGS was $2,611
million as compared to $2,585
million for 2015.
As a percentage of total revenues, GAAP COGS was 28% in the
fourth quarter of 2016, as compared to 26% in the same period in
2015, an increase of 2%. Full year 2016 GAAP COGS as a
percentage of total revenues came in at 27% as compared to 25% in
2015, an increase of 2%.
Adjusted COGS (non-GAAP) for the fourth quarter came in at
$666 million as compared to
$672 million in 2015. Full year
2016 Adjusted COGS (non-GAAP) were $2,557
million as compared to $2,402
million for 2015, an increase of $155
million, or 6%.
As a percentage of total revenues, Adjusted COGS (non-GAAP) was
28% in the fourth quarter of 2016, as compared to 24% in the same
period in 2015, an increase of 4%. Full year 2016 Adjusted
COGS (non-GAAP) as a percentage of total revenues were 26% as
compared to 23% in 2015, an increase of 3%.
For both GAAP COGS and Adjusted COGS (non-GAAP), the increase in
year-over-year expenses, as a percentage of total revenues, was
primarily driven by a decrease in average realized pricing across
all of our segments. The increase was also attributable to an
unfavorable change in product mix, as, in 2016, a greater
percentage of our revenue was attributable to the Bausch +
Lomb/International segment, which generally has lower gross margins
than the balance of the Company's product portfolio.
These increases were partially offset by lower acquisition
accounting related adjustments to inventory expensed in 2015,
primarily related to the fair value step-up in inventories acquired
in the Salix Acquisition and other acquisitions.
Selling, General and Administrative (SG&A)
Total GAAP SG&A was $665
million for the fourth quarter of 2016 as compared to
$743 million in the fourth quarter of
2015. Full year 2016 total GAAP SG&A was $2,810 million as compared to $2,700 million for 2015.
As a percentage of total revenues, GAAP SG&A was 28% in the
fourth quarter of 2016, as compared to 27% in the same period in
2015, an increase of 1%. Full year 2016 GAAP SG&A as a
percentage of total revenues were 29% as compared to 26% in 2015,
an increase of 3%.
Adjusted SG&A (non-GAAP) expenses in the fourth quarter of
2016 came in at $658 million as
compared to $682 million in the
fourth quarter of 2015. Full year 2016 Adjusted SG&A
(non-GAAP) was $2,698 million as
compared to $2,611 million for
2015.
As a percentage of total revenues, Adjusted SG&A (non-GAAP)
was 27% in the fourth quarter of 2016, as compared to 25% in the
same period in 2015, an increase of 2%. Full year 2016
Adjusted SG&A (non-GAAP) as a percentage of total revenues were
28% as compared to 25% in 2015, an increase of 3%.
For both GAAP SG&A and Adjusted SG&A (non-GAAP), the
increase in expenses, as a percentage of total revenues, were
primarily driven by expenses related to acquisitions, severance
payments to former employees as well as fees related to the
recruiting and on boarding of new staff. The increase also
reflected professional fees in connection with recent legal and
governmental proceedings, investigations and information requests
relating to, among other matters, our distribution, marketing,
pricing, disclosure and accounting practices, and increases in
legal and professional fees in connection with ongoing corporate
and business matters.
These factors were partially offset by a net decrease in
advertising and selling expenses, primarily driven by decreases in
promotion and advertising in our Dermatology and Salix businesses
and partially offset by an increase to our reserve for sales
returns and allowances recorded in the fourth quarter.
Research and Development (R&D)
Total GAAP R&D was $93 million for the fourth
quarter of 2016 as compared to $95
million in the fourth quarter of 2015. Full year 2016 total
GAAP R&D was $421 million as
compared to $334 million for
2015.
As a percentage of total revenues, GAAP R&D was 4% in the
fourth quarter of 2016, as compared to 3% in the same period in
2015, an increase of 1%. Full year 2016 GAAP R&D as a
percentage of total revenues were 4% as compared to 3% in 2015, an
increase of 1%.
Adjusted R&D (non-GAAP) expenses for the fourth quarter of
2016 were $93 million as compared to
$95 million in the fourth quarter of
2015. Full year 2016 Adjusted R&D (non-GAAP) expenses
were $404 million as compared to
$333 million for 2015.
As a percentage of total revenues, Adjusted R&D (non-GAAP)
was 4% in the fourth quarter of 2016, as compared to 3% in the same
period in 2015, an increase of 1%. Full year 2016 Adjusted
R&D (non-GAAP) as a percentage of total revenues were 4% as
compared to 3% in 2015, an increase of 1%.
For both GAAP R&D and Adjusted R&D (non-GAAP), the
year-over-year increases in expenses, as a percentage of total
revenues, was driven by our focus to maximize the value of our core
segments. To bring out additional value in our core
Branded Rx segment, we dedicated additional resources to
enhance our Dermatology and Gastrointestinal (GI) portfolios.
To bring out additional value in our core Bausch +
Lomb/International segment, we dedicated additional resources
to enhance our eye health and vision care portfolios.
GAAP Operating Income (Loss)
Operating income for the fourth quarter of 2016 was $151 million as compared to $168 million for the fourth quarter of
2015. Fourth quarter operating income reflected a decrease in
contribution margin as a result of the decline in product sales
from the existing business, the unfavorable impact of foreign
currency, net incremental goodwill impairment charges, and the
impact of divestitures and discontinuations.
Full year 2016 operating loss was $566
million as compared to operating income for 2015 of
$1,527 million, a decrease of
$2,093 million. Full year 2016
results reflected a decrease in contribution from our existing
business, which was partially offset by incremental contribution
from acquisitions. Operating income was further impacted in
2016 by an increase in SG&A and R&D expenses, an
increase in amortization of intangible assets and goodwill
impairments, a decrease in restructuring and integration costs, a
decrease in in-process R&D costs and post-combination
expenses.
GAAP Net Income (Loss)
Net loss for the fourth quarter of 2016 was $(515) million as compared to a net loss of
$(385) million in the fourth quarter
of 2015, an increase of $130 million.
In addition to the increase in our operating loss of
$17 million, the increase in Net loss
was primarily driven by increases in interest expense of
$34 million, foreign exchange loss
and other of $43 million, and
provisions for income taxes of $33
million.
For full year 2016, Net loss was $2,409
million as compared to $292
million in 2015, an increase of $2,120 million. The increase is primarily
attributable to the increase in loss before income taxes of
$2,280 million. The 2016 net loss
includes a recovery of income taxes of $27
million while the 2015 net loss includes a provision for
income taxes of $133 million.
Adjusted EBITDA (non-GAAP)
Adjusted EBITDA (non-GAAP) for the fourth quarter of 2016 came
in at $1,045 million as compared to
$1,374 million for the fourth quarter
of 2015. Full year 2016 Adjusted EBITDA (non-GAAP) was $4,305 million as compared to $5,369 million in 2015.
Adjusted Net Income (non-GAAP)
Adjusted net income (non-GAAP) in the fourth quarter of 2016 was
$441 million as compared to
$542 million in the fourth quarter of
2015. Full year 2016 Adjusted net income (non-GAAP) was
$1,916 million as compared to
$2,841 million in 2015.
GAAP Earnings Per Share (EPS)
GAAP EPS for the fourth quarter of 2016 came in at $(1.47) as compared to $(1.12) in the fourth quarter of 2015. Full
year 2016 GAAP EPS were $(6.94) as
compared to $(0.85) for 2015.
Adjusted EPS (non-GAAP)
Adjusted EPS (non-GAAP) for the fourth quarter of 2016 came in
at $1.26 as compared to $1.55 in the fourth quarter of 2015. Full
year 2016 Adjusted EPS (non-GAAP) were $5.47 as compared to $8.14 for 2015.
GAAP Cash Flow from Operations
Net cash provided by operating activities for the fourth quarter
of 2016 was $513 million as compared
to $598 million for the fourth
quarter of 2015, reflecting a decline of 14%. The decrease was
primarily driven by the decrease in contribution margin as a result
of the decline in product sales from our existing business
partially offset by lower cash operating expenses.
Full year 2016 net cash provided by operating activities was
$2,087 million as compared to
$2,257 million in 2015 respectively,
reflecting a decline of 8%. The decrease was primarily driven
by lower operating cash flows generated from our existing business
primarily attributable to a decrease in contribution in the Branded
Rx segment and the U.S. Diversified segment and was primarily
attributable to lower average realized pricing and lower volumes
from our existing business of $652
million and $625 million,
respectively, which was partially offset by incremental product
sales from acquisitions of $735
million.
Results were further impacted by an increase in interest paid of
$449 million due to higher
borrowings, primarily resulting from the issuances of debt in
connection with the Salix Acquisition and an increase in interest
rates applicable to our term loans and borrowings under our
revolving credit facility under our senior secured credit
facilities as a result of amendments in 2016.
2017 Full Year Guidance:
Valeant has provided guidance for 2017 as follows:
- GAAP Total Revenues in the range $8.90
billion - $9.10 billion,
- Adjusted EBITDA (non-GAAP) in the range of $3.55 billion - $3.70 billion
Other than with respect to GAAP Total Revenues, the Company only
provides guidance on a non-GAAP basis. The Company does not provide
a reconciliation of forward-looking Adjusted EBITDA (non-GAAP) to
GAAP net income (loss), due to the inherent difficulty in
forecasting and quantifying certain amounts that are necessary for
such reconciliation. In periods where there are not expected to be
significant acquisitions or divestitures, the Company believes it
might have a basis for forecasting the GAAP equivalent for certain
costs, such as amortization, that would otherwise be treated as
non-GAAP to calculate projected GAAP net income (loss).
However, because other deductions (such as restructuring, gain or
loss on extinguishment of debt and litigation settlements) used to
calculate projected net income (loss) vary dramatically based on
actual events, the Company is not able to forecast on a GAAP basis
with reasonable certainty all deductions needed in order to provide
a GAAP calculation of projected net income (loss) at this
time. The amounts of these deductions may be material and,
therefore, could result in projected GAAP net income (loss) being
materially less than projected Adjusted EBITDA (non-GAAP). The
Company is no longer providing guidance with respect to Adjusted
Net Income or Adjusted EPS.
Conference Call
Details
|
|
|
Date
|
Tuesday, February 28,
2017
|
Time
|
8:00 a.m.
ET
|
Webcast
|
http://ir.valeant.com/events-and-presentations
|
Participant Event
Dial-in
|
(877) 876-8393 (North
America)
|
|
(443) 961-0178
(International)
|
Participant
Passcode
|
63999208
|
Replay
Dial-in
|
(855) 859-2056 (North
America)
|
|
(404) 537-3406
(International)
|
Replay
Passcode
|
63999208 (replay
available until 03/31/2017)
|
About Valeant
Valeant Pharmaceuticals International, Inc. (NYSE/TSX:VRX) is a
multinational specialty pharmaceutical company that develops,
manufactures and markets a broad range of pharmaceutical
products primarily in the areas of dermatology, gastrointestinal
disorders, eye health, neurology and branded generics. More
information about Valeant can be found at www.valeant.com.
Forward-looking Statements
This press release may contain forward-looking statements,
including, but not limited to, statements regarding Valeant's
future prospects and performance (including the Company's guidance
with respect to GAAP Total Revenues and Adjusted EBITDA (non-GAAP)
(as discussed and defined below)) and the Company's plans and
expectations for 2017. Forward-looking statements may generally be
identified by the use of the words "anticipates," "expects,"
"intends," "plans," "should," "could," "would," "may," "will,"
"believes," "estimates," "potential," "target," or "continue" and
variations or similar expressions. These statements are based upon
the current expectations and beliefs of management and are subject
to certain risks and uncertainties that could cause actual results
to differ materially from those described in the forward-looking
statements. These risks and uncertainties include, but are not
limited to, risks and uncertainties discussed in the Company's most
recent annual and quarterly reports and detailed from time to time
in Valeant's other filings with the Securities and Exchange
Commission and the Canadian Securities Administrators, which
factors are incorporated herein by reference. Readers are cautioned
not to place undue reliance on any of these forward-looking
statements. These forward-looking statements speak only as of
the date hereof. Valeant undertakes no obligation to update any of
these forward-looking statements to reflect events or circumstances
after the date of this press release or to reflect actual outcomes,
unless required by law.
Non-GAAP Information
Recent Evaluation of Financial Performance
Measures
Recently, the Company's new management team undertook an
evaluation of how it would measure the financial performance of the
Company going forward. In evaluating its financial performance
measures, the Company considered its recent changes to its strategy
(which included a transition away from growth by acquisition with a
greater focus on R&D activity, strengthening of the balance
sheet through the paydown of debt and rationalization of the
product portfolio through divestitures of non-core assets) and
sought to identify performance measures that best reflected the
Company's current business operations, strategy and goals. As a
result of that evaluation, new management identified the following
primary financial performance measures for the Company: GAAP
Revenues (measure for both guidance and actual results), GAAP Net
Income (measure for actual results), Adjusted EBITDA (non-GAAP)
(measure for both guidance and actual results) and GAAP Cash Flow
from Operations (measure for actual results). These measures were
selected as the Company believes that these measures most
appropriately reflect how the Company measures the business
internally and sets operational goals and incentives. For example,
the Company believes that adjusted EBITDA (non-GAAP) focuses
management on the Company's underlying operational results and true
business performance, while GAAP revenue focuses management on the
overall growth of the business.
These new measures will be used on a going forward basis,
commencing with 2017 guidance. For the purposes of the Company's
actual results for the full year 2016 and the fourth quarter ended
December 31, 2016, the Company will
continue to use the financial performance measures it has
historically used, following which the Company will discontinue the
use of certain of these historic measures, such as Adjusted EPS
(non-GAAP) and Adjusted Net Income (non-GAAP).
Use of Non-GAAP Generally
To supplement the financial measures prepared in accordance with
U.S. generally accepted accounting principles (GAAP), the Company
uses certain non-GAAP financial measures including (i) Adjusted
Earnings per Share ("EPS") (non-GAAP), (ii) Adjusted Net Income
(non-GAAP), (iii) Adjusted EBITDA (non-GAAP), (iv) Adjusted Cost of
Goods (COGS) (non-GAAP), (v) Adjusted Selling, general and
administrative (SG&A) (non-GAAP), and (vi) Adjusted Research
& Development ("R&D) (non-GAAP). These measures do not have
any standardized meaning under GAAP and other companies may use
similarly titled non-GAAP financial measures that are calculated
differently from the way we calculate such measures.
Accordingly, our non-GAAP financial measures may not be comparable
to similar non-GAAP measures. We caution investors not to
place undue reliance on such non-GAAP measures, but instead to
consider them with the most directly comparable GAAP
measures. Non-GAAP financial measures have limitations as
analytical tools and should not be considered in isolation.
They should be considered as a supplement to, not a substitute for,
or superior to, the corresponding measures calculated in accordance
with GAAP.
The reconciliations of these historic non-GAAP measures to the
most directly comparable financial measures calculated and
presented in accordance with GAAP are shown in the tables
below. Other than with respect to GAAP Total Revenues, the
Company only provides guidance on a non-GAAP basis and does not
provide reconciliations of Adjusted EBITDA (non-GAAP) to GAAP net
income (loss), due to the inherent difficulty in forecasting and
quantifying certain amounts that are necessary for such
reconciliations. In periods where there are not expected to be
significant acquisitions or divestitures, the Company believes it
might have a basis for forecasting the GAAP equivalent for certain
costs, such as amortization, that would otherwise be treated as
non-GAAP to calculate projected GAAP net income (loss).
However, because other deductions (e.g., restructuring, gain or
loss on extinguishment of debt and litigation settlements) used to
calculate projected net income (loss) vary dramatically based on
actual events, the Company is not able to forecast on a GAAP basis
with reasonable certainty all deductions needed in order to provide
a GAAP calculation of projected net income (loss) at this time. The
amounts of these deductions may be material and, therefore, could
result in GAAP net income (loss) being materially less than
projected adjusted EBITDA (non-GAAP).
Management uses these non-GAAP measures as key metrics in the
evaluation of Company performance and the consolidated financial
results and, in part, in the determination of cash bonuses for its
executive officers. The Company believes these non-GAAP
measures are useful to investors in their assessment of our
operating performance and the valuation of our Company. In
addition, these non-GAAP measures address questions the Company
routinely receives from analysts and investors and, in order to
assure that all investors have access to similar data, the Company
has determined that it is appropriate to make this data available
to all investors. However, non-GAAP financial measures are
not prepared in accordance with GAAP, as they exclude certain items
as described herein. Therefore, the information is not
necessarily comparable to other companies and should be considered
as a supplement to, not a substitute for, or superior to, the
corresponding measures calculated in accordance with GAAP.
Specific Non-GAAP Measures
Adjusted EPS (non-GAAP) and Adjusted Net Income (Loss)
(non-GAAP)
Historically and for the current reporting period, management has
used adjusted EPS (non-GAAP) (the most directly comparable GAAP
financial measure for which is GAAP EPS) and adjusted net income
(loss) (non-GAAP) (the most directly comparable GAAP financial
measure for which is GAAP net income (loss)) for strategic decision
making, forecasting future results and evaluating current
performance. In addition, historically (including with
respect to 2016), cash bonuses for the Company's executive officers
were based, in part, on the achievement of certain adjusted EPS
(non-GAAP) targets. Such non-GAAP measures exclude the impact
of certain items (as further described below) that may obscure
trends in the Company's underlying performance. By disclosing
these non-GAAP measures, it was management's intention to provide
investors with a meaningful, supplemental comparison of the
Company's operating results and trends for the periods
presented. It was management belief that these measures were
also useful to investors as such measures allowed investors to
evaluate the Company's performance using the same tools that
management had used to evaluate past performance and prospects for
future performance. Accordingly, it was the Company's belief that
adjusted net income (loss) (non-GAAP) and adjusted EPS (non-GAAP)
were useful to investors in their assessment of the Company's
operating performance and the valuation of the Company. It is also
noted that, in recent periods, our GAAP net income and GAAP EPS
were significantly lower than our adjusted net income (non-GAAP)
and adjusted EPS (non-GAAP). As indicated above, following an
assessment of the Company's financial performance measures, new
management of the Company identified certain new primary financial
performance measures that will be used to assess Company financial
performance going forward. As a result, following the current
reporting period, the Company will no longer use or rely on these
two non-GAAP measures (Adjusted EPS and Adjusted Net Income) in
assessing the financial performance of the Company.
Adjusted EPS (non-GAAP) and adjusted net income (non-GAAP)
reflect adjustments based on the following items:
- Acquisition- related adjustments excluding amortization of
finite-lived assets: The Company has excluded the impact of fair
value inventory amortization step-up resulting from acquisitions as
the amount and frequency of such adjustments are not consistent and
are significantly impacted by the timing and size of its
acquisitions. In addition, the Company has excluded the impact of
acquisition-related contingent consideration non-cash adjustments
due to the inherent uncertainty and volatility associated with such
amounts based on changes in assumptions with respect to fair value
estimates, and the amount and frequency of such adjustments is not
consistent and is significantly impacted by the timing and size of
the Company's acquisitions, as well as the nature of the
agreed-upon consideration.
- Amortization of finite-lived intangible assets: The Company has
excluded the impact of amortization of finite-lived intangible
assets, as such amounts are inconsistent in amount and frequency
and are significantly impacted by the timing and/or size of
acquisitions. The Company believes that the adjustments of these
items more closely correlate with the sustainability of the
Company's operating performance. Although the Company excludes
amortization of intangible assets from its non-GAAP expenses, the
Company believes that it is important for investors to understand
that such intangible assets contribute to revenue generation.
Amortization of intangible assets that relate to past acquisitions
will recur in future periods until such intangible assets have been
fully amortized. Any future acquisitions may result in the
amortization of additional intangible assets.
- Goodwill Impairment: The Company has excluded the impact of
goodwill impairment, which is a one-time charge. When the Company
has made acquisitions where the consideration paid was in excess of
the fair value of the assets acquired, the remaining purchase price
is booked as goodwill. Goodwill is written off when an impairment
test indicates that the value of the assets acquired has been
reduced. For assets that we developed ourselves, no goodwill is
booked. We exclude goodwill impairment charges because they are
one-time, non-recurring and because they are impacted by the timing
and size of acquisitions. In addition, management excludes these
charges in measuring the performance of the Company and the
business. However, goodwill impairment charges do reflect
deterioration in the value of business units.
- Asset Impairments: The Company has excluded the impact of
impairments of finite-lived and indefinite-lived intangibles, as
well as impairments of assets held for sale, as such amounts are
inconsistent in amount and frequency and are significantly impacted
by the timing and/or size of acquisitions and divestitures. The
Company believes that the adjustments of these items more closely
correlate with the sustainability of the Company's operating
performance. Although the Company excludes intangible impairments
from its non-GAAP expenses, the Company believes that it is
important for investors to understand that intangible assets
contribute to revenue generation.
- Restructuring and integration costs: In recent years, the
Company completed a number of acquisitions, which resulted in
operating expenses which varied significantly from period to period
and which would not otherwise have been incurred. The type, nature,
size and frequency of the Company's acquisitions have varied
considerably period to period. As a result, the type and amount of
the restructuring, integration and deal costs have also varied
significantly from acquisition to acquisition. In addition, the
costs associated with an acquisition varied significantly from
quarter to quarter, with most costs generally decreasing over time.
Consequently, given the variability and volatility of these costs
from acquisition to acquisition and period to period and because
these costs are incremental and directly related to the
acquisition, the Company does not view these costs as normal
operating expenses. Furthermore, due to the volatility of these
costs and due to the fact that they are directly related to the
acquisitions, the Company believes that such costs generally were
not relevant to assessing or estimating the long-term performance
of the acquired businesses or assets as part of the Company. Also,
the size, complexity and/or volume of past acquisitions, which
often drove the magnitude of such expenses, were not necessarily
indicative of the size, complexity and/or volume of any future
acquisitions. By excluding these expenses from its non-GAAP
measures, management believes it provided supplemental information
that assisted investors with their evaluation of the Company's
ability to utilize its existing assets and with its estimation of
the long-term value that acquired assets would generate for the
Company. Furthermore, the Company believes that the adjustments of
these items provided supplemental information with regard to the
sustainability of the Company's operating performance, allowed a
more informative comparison of the financial results to historical
operations and forward-looking guidance and, as a result, provided
useful supplemental information to investors.
- In-Process research and development costs: The Company has
excluded expenses associated with acquired in-process research and
development, as these amounts are inconsistent in amount and
frequency and are significantly impacted by the timing, size and
nature of acquisitions.
- Other Non-GAAP Charges: The Company has excluded certain other
amounts including integration related inventory charges and
technology transfer costs, acquisition-related transaction costs,
CEO termination costs, legal and professional fees incurred in
connection with recent legal and governmental proceedings,
investigations and information requests respecting certain of our
distribution, marketing, pricing, disclosure and accounting
practices, certain accelerated depreciation expenses due to fixed
assets write-offs acquired from Salix, certain costs associated
with the wind-down of the arrangements with Philidor Rx Services,
LLC ("Philidor"), and a charge in connection with a settlement of
certain disputed invoices related to transition services. In
addition, the Company has excluded certain other expenses that are
the result of other, non-comparable events to measure operating
performance, primarily including costs associated with legal
settlements and related fees, post-combination expenses associated
with business combinations for the acceleration of employee stock
awards and/or cash bonuses, loss upon deconsolidation of Philidor
and gains/losses from the sale of assets and businesses. In
addition, in the first quarter of 2016, the Company also excluded
revenue related to Philidor for January
2016. These events arise outside of the ordinary course of
continuing operations. Given the unique nature of the matters
relating to these costs, the Company believes these items are not
normal operating expenses. For example, legal settlements and
judgments vary significantly, in their nature, size and frequency,
and, due to this volatility, the Company believes the costs
associated with legal settlements and judgments are not normal
operating expenses. In addition, as opposed to more ordinary course
matters, the Company considers that each of the recent proceedings,
investigations and information requests, given their nature and
frequency, are outside of the ordinary course and relate to unique
circumstances. The Company believes that the exclusion of such
out-of-the-ordinary-course amounts provides supplemental
information to assist in the comparison of the financial results of
the Company from period to period and, therefore, provides useful
supplemental information to investors. However, investors should
understand that many of these costs could recur and that companies
in our industry often face litigation.
- Amortization of deferred financing costs and debt discounts:
The Company has excluded amortization of deferred financing costs
and debt discounts and write-down of deferred financing costs as
these represent non-cash components of interest expense.
- Loss on extinguishment of debt: The Company has excluded loss
on extinguishment of debt as this represents a non-cash charge, and
the amount and frequency of such charges is not consistent and is
significantly impacted by the timing and size of debt financing
transactions.
- Foreign exchange and other: The Company has excluded the impact
of foreign currency fluctuations primarily related to intercompany
financing arrangements in evaluating company performance.
- Tax: The Company has included the tax impact of the non-GAAP
adjustments using an annualized effective tax rate.
Please also see the reconciliation tables below for further
information as to how these non-GAAP measures are calculated for
the periods presented.
Adjusted EBITDA (non-GAAP)
Adjusted EBITDA (non-GAAP) is GAAP net income (its most directly
comparable GAAP financial measure) adjusted for certain items, as
further described below. The Company has historically used
Adjusted EBITDA to evaluate current performance. As indicated
above, following an evaluation of the Company's financial
performance measures, new management of the Company identified
certain new primary financial performance measures that will be
used to evaluate the Company's financial performance. One of those
measures is Adjusted EBITDA (non-GAAP), which will be used for both
actual results and guidance purposes. As described above,
management of the Company believes that adjusted EBITDA (non-GAAP),
along with the other new measures, most appropriately reflect how
the Company measures the business internally and sets operational
goals and incentives, especially in light of the Company's new
strategies. In particular, the Company believes that adjusted
EBITDA (non-GAAP) focuses management on the Company's underlying
operational results and true business performance. As a result,
going forward (commencing with 2017 guidance and first quarter 2017
actual results), the Company will use Adjusted EBITDA (non-GAAP)
both to assess the actual financial performance of the Company and
to forecast future results as part of its guidance.
Management believes adjusted EBITDA (non-GAAP) is a useful
measure to evaluate current performance. Adjusted EBITDA (non-GAAP)
is intended to show our unleveraged, pre-tax operating results and
therefore reflects our financial performance based on operational
factors, excluding anticipated non-cash losses or gains and before
interest (to show unlevered cash flow) and taxes (which depend in
part on interest expense). In addition, commencing in 2017, cash
bonuses for the Company's executive officers and other key
employees will be based, in part, on the achievement of certain
adjusted EBITDA (non-GAAP) targets.
Adjusted EBITDA (non-GAAP) – 2016 Actual Results
As
indicated above, the Company's new management team undertook an
evaluation of how it measured the financial performance of the
Company going forward. In addition to identifying new primary
financial performance measures, new management also assessed the
manner in which it was calculating its financial performance
measures and made updates where it deemed appropriate to better
reflect the underlying business. As a result, there are certain
differences in the calculation of Adjusted EBITDA (non-GAAP)
between the current presentation and the revised presentation.
These differences are noted below.
For the purposes of 2016 actual results (for which we are using
the current presentation) Adjusted EBITDA (non-GAAP) reflects the
adjustments reflected in adjusted net income (non-GAAP) (see
disclosure above). In addition, the Company excludes the impact of
costs relating to share-based compensation. Share-based
compensation expense can vary significantly based on the timing,
size and nature of awards granted. Finally, to the extent not
already adjusted for, adjusted EBITDA (non-GAAP) reflects
adjustments for interest, taxes, depreciation and amortization
(EBITDA represents earnings before interest, taxes, depreciation
and amortization).
Adjusted EBITDA (non-GAAP) – 2017 Guidance
As describe
above, going forward, commencing with 2017 guidance, the Company
will be using a revised presentation for adjusted EBITDA (non-GAAP)
as compared to the presentation it has historically used (and that
has been used for its 2016 actual results). As part of the
evaluation of its financial performance measures, new management of
the Company considered the adjustments being used in the calculation of adjusted
EBITDA (non-GAAP) and identified certain adjustments that new
management no longer believed reflected the Company's current
business operations and strategy or how the Company measures the
business internally. As a result, on a going forward basis, the Company will no longer be making
these adjustments. In particular, the following items will no
longer be added back in the calculation of Adjusted EBITDA
(non-GAAP): inventory step-up, acquisition-related costs, foreign
exchange and other, integration related inventory and technology
transfer costs and certain other smaller items. This new
presentation is used for the purposes of 2017 guidance.
Adjusted Cost of Goods (COGS) (non-GAAP)
Management uses this non-GAAP measure (the most directly comparable
GAAP financial measure for which is Cost of Goods Sold) as a
supplemental measure for period-to-period comparison. Non-GAAP Cost
of Goods Sold excludes certain costs primarily relating to fair
value step-up adjustments to inventory and property, plant and
equipment and integration-related inventory charges and technology
transfers, which relate to acquisitions and can cause variability
from period to period. The Company believes that the exclusion of
such amounts provides supplemental information to assist in the
comparison of the financial results of the Company (and its
reporting segments) from period to period and, therefore, provides
useful supplemental information to investors. Please also see
the reconciliation tables below for further information as to how
this non-GAAP measure is calculated for the periods
presented.
Adjusted Selling, General and Administrative (SG&A)
(non-GAAP)
Management uses this non-GAAP measure (the most directly comparable
GAAP financial measure for which is selling, general and
administrative) as a supplemental measure for period-to-period
comparison. Non-GAAP Selling, General and Administrative excludes,
as applicable, CEO termination benefits, accelerated depreciation
expense related to fixed assets acquired in the acquisition of
Salix, certain costs associated with the wind-down of the
arrangements with Philidor, and certain costs primarily related to
legal and other professional fees relating to legal and
governmental proceedings, investigations and information requests
respecting certain of our distribution, marketing, pricing,
disclosure and accounting practices. See the discussion under
"Other Non-GAAP charges" above. Please also see the reconciliation
tables below for further information as to how this non-GAAP
measure is calculated for the periods presented.
Adjusted R&D Investment (non-GAAP)
Management uses this non-GAAP measure (the most directly comparable
GAAP financial measure for which is research and development
expenses) as a supplemental measure for period-to-period
comparison. Non-GAAP R&D Investment reflects adjustments for a
charge in connection with a settlement of certain disputed invoices
related to transition services. Please also see the reconciliation
tables below for further information as to how this non-GAAP
measure is calculated for the periods presented.
Contact Information:
Elif
McDonald
elif.mcdonald@valeant.com
514-856-3855
877-281-6642 (toll free)
Media:
Renée Soto
or
Chris Kittredge/Jared Levy
Sard Verbinnen & Co.
212-687-8080
FINANCIAL TABLES FOLLOW
Valeant
Pharmaceuticals International, Inc.
|
|
Table
1
|
Condensed
Consolidated Statements of (Loss) Income
|
For the Three and
Twelve Months Ended December 31, 2016 and 2015
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
December
31,
|
|
December
31,
|
(In
millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
Product
sales
|
|
$ 2,368
|
|
$ 2,723
|
|
$
9,536
|
|
$ 10,292
|
Other
revenues
|
|
35
|
|
35
|
|
138
|
|
155
|
Total
revenues
|
|
2,403
|
|
2,758
|
|
9,674
|
|
10,447
|
|
|
|
|
|
|
|
|
|
Cost of goods sold
(exclusive of amortization and impairments of finite-lived
intangible assets shown separately below)
|
|
655
|
|
720
|
|
2,572
|
|
2,532
|
Cost of other
revenues
|
|
10
|
|
10
|
|
39
|
|
53
|
Selling, general and
administrative ("SG&A")
|
|
665
|
|
743
|
|
2,810
|
|
2,700
|
Research and
development
|
|
93
|
|
95
|
|
421
|
|
334
|
Goodwill
impairment
|
|
28
|
|
-
|
|
1,077
|
|
-
|
Amortization of
finite-lived intangible assets
|
|
657
|
|
670
|
|
2,673
|
|
2,257
|
Restructuring and
integration costs
|
|
54
|
|
88
|
|
132
|
|
362
|
In-process research
and development costs
|
|
-
|
|
106
|
|
34
|
|
106
|
Asset
Impairments
|
|
28
|
|
153
|
|
422
|
|
304
|
Acquisition-related
contingent consideration
|
|
(31)
|
|
(46)
|
|
(13)
|
|
(23)
|
Other
expense
|
|
93
|
|
51
|
|
73
|
|
295
|
|
|
2,252
|
|
2,590
|
|
10,240
|
|
8,920
|
Operating income
(loss)
|
|
151
|
|
168
|
|
(566)
|
|
1,527
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
(465)
|
|
(431)
|
|
(1,828)
|
|
(1,559)
|
Loss on
extinguishment of debt
|
|
-
|
|
-
|
|
-
|
|
(20)
|
Foreign exchange and
other
|
|
(46)
|
|
(3)
|
|
(41)
|
|
(103)
|
|
|
|
|
|
|
|
|
|
(Loss) income before
provision for (recovery of) income taxes
|
|
(360)
|
|
(266)
|
|
(2,435)
|
|
(155)
|
|
|
|
|
|
|
|
|
|
Provision for
(recovery of) income taxes
|
|
152
|
|
119
|
|
(27)
|
|
133
|
|
|
|
|
|
|
|
|
|
Net
loss
|
|
(512)
|
|
(385)
|
|
(2,408)
|
|
(288)
|
|
|
|
|
|
|
|
|
|
Less: Net
(loss) income attributable to noncontrolling interest
|
|
3
|
|
-
|
|
1
|
|
4
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to Valeant Pharmaceuticals International, Inc.
|
|
$
(515)
|
|
$
(385)
|
|
$(2,409)
|
|
$
(292)
|
|
|
|
|
|
|
|
|
|
(Loss) Earnings
per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic:
|
|
|
|
|
|
|
|
|
(Loss)
|
|
$ (1.47)
|
|
$ (1.12)
|
|
$
(6.94)
|
|
$
(0.85)
|
Shares used in per
share computation
|
|
349.6
|
|
344.9
|
|
347.3
|
|
342.7
|
|
|
|
|
|
|
|
|
|
Diluted:
|
|
|
|
|
|
|
|
|
(Loss)
|
|
$ (1.47)
|
|
$ (1.12)
|
|
$
(6.94)
|
|
$
(0.85)
|
Shares used in per
share computation
|
|
349.6
|
|
344.9
|
|
347.3
|
|
342.7
|
Valeant
Pharmaceuticals International, Inc.
|
|
Table
2
|
Reconciliation of
GAAP EPS to Adjusted EPS Non-GAAP
|
For the Three and
Twelve Months Ended December 31, 2016 and 2015
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
December
31,
|
|
December
31,
|
(In
millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to Valeant Pharmaceuticals International, Inc.
|
|
$ (515)
|
|
$ (385)
|
|
$(2,409)
|
|
$
(292)
|
|
|
|
|
|
|
|
|
|
Non-GAAP
adjustments: (a)
|
|
|
|
|
|
|
|
|
Acquisition-related
adjustments excluding amortization of finite-lived intangible
assets (b) (d)
|
|
(31)
|
|
(2)
|
|
33
|
|
140
|
Amortization of
finite-lived intangible assets
|
|
657
|
|
670
|
|
2,673
|
|
2,257
|
Goodwill
impairment
|
|
28
|
|
-
|
|
1,077
|
|
-
|
Restructuring and
integration costs
|
|
54
|
|
88
|
|
132
|
|
362
|
In-process research
and development costs
|
|
-
|
|
106
|
|
34
|
|
106
|
Asset
Impairments
|
|
28
|
|
153
|
|
422
|
|
304
|
Other non-GAAP
charges (c) (d)
|
|
99
|
|
122
|
|
208
|
|
400
|
|
|
835
|
|
1,137
|
|
4,579
|
|
3,569
|
Amortization of
deferred financing costs and debt discounts
|
|
29
|
|
27
|
|
118
|
|
159
|
Loss on
extinguishment of debt
|
|
-
|
|
-
|
|
-
|
|
20
|
Foreign exchange and
other
|
|
28
|
|
(2)
|
|
14
|
|
95
|
Tax effect of
non-GAAP adjustments
|
|
64
|
|
(235)
|
|
(386)
|
|
(710)
|
Total non-GAAP
adjustments
|
|
956
|
|
927
|
|
4,325
|
|
3,133
|
|
|
|
|
|
|
|
|
|
Adjusted net income
non-GAAP attributable to Valeant Pharmaceuticals International,
Inc. (d)
|
|
$
441
|
|
$
542
|
|
$
1,916
|
|
$
2,841
|
|
|
|
|
|
|
|
|
|
GAAP (loss) earnings
per share - diluted
|
|
$(1.47)
|
|
$(1.12)
|
|
$
(6.94)
|
|
$
(0.85)
|
|
|
|
|
|
|
|
|
|
Adjusted earnings per
share non-GAAP - diluted (d)
|
|
$
1.26
|
|
$
1.55
|
|
$
5.47
|
|
$
8.14
|
|
|
|
|
|
|
|
|
|
Shares used in
diluted per share calculation - GAAP earnings per share
|
|
349.6
|
|
344.9
|
|
347.3
|
|
342.7
|
|
|
|
|
|
|
|
|
|
Shares used in
diluted per share calculation - Adjusted earnings per share
non-GAAP
|
|
350.4
|
|
349.9
|
|
350.1
|
|
348.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) The components of
(and further details respecting) each of these non-GAAP adjustments
and the financial statement line item to which each component
relates can be found on Table 2a.
|
(b) Due to the nature
of Acquisition-related adjustments excluding amortization of
finite-lived intangible assets, the components of this non-GAAP
adjustment are reflected in various financial statement line items,
as follows: Cost of goods sold, Selling, general and
administrative, Research and development, and Acquisition-related
contingent consideration.
|
(c) Due to the nature
of Other non-GAAP charges, the components of this non-GAAP
adjustment are reflected in various financial statement line items,
as follows: Product Sales, Cost of goods sold, Selling, general and
administrative, Research and development, and Other
expense.
|
(d) As of the third
quarter of 2016, Adjusted net income (non-GAAP) and Adjusted EPS
(non-GAAP) no longer include adjustments for the following items:
Depreciation resulting from a PP&E step-up resulting from
acquisitions; and Previously accelerated vesting of certain
share-based equity adjustments. Depreciation resulting from a
PP&E step-up resulting from acquisitions was a component of
Acquisition-related adjustments excluding amortization of
finite-lived intangible assets. Previously accelerated vesting of
certain share-based equity adjustments was a component of Other
non-GAAP charges. For the purpose of allowing investors to evaluate
Adjusted net income (non-GAAP) and Adjusted EPS (non-GAAP) on a
consistent basis for the periods presented, the aggregate amounts
of each of Depreciation resulting from a PP&E step-up resulting
from acquisitions, and Previously accelerated vesting of certain
share-based equity adjustments in the fourth quarter of 2016 were
$3 million and ($2) million, respectively and for the twelve months
ended December 31, 2016 were $13 million and ($6) million,
respectively.
|
Valeant
Pharmaceuticals International, Inc.
|
Table
2a
|
Reconciliation of
GAAP to Non-GAAP Financial Information
|
For the Three and
Twelve Months Ended December 31, 2016 and 2015
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
December
31,
|
|
December
31,
|
(In
millions)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
|
Total Revenues
reconciliation:
|
|
|
|
|
|
|
|
|
GAAP
Revenues
|
|
$ 2,403
|
|
$ 2,758
|
|
$
9,674
|
|
$
10,447
|
Philidor Rx Services,
LLC sales through deconsolidation as of January 31, 2016
(a)
|
|
-
|
|
(5)
|
|
(2)
|
|
(5)
|
Adjusted revenues
(non-GAAP)
|
|
$ 2,403
|
|
$ 2,753
|
|
$
9,672
|
|
$
10,442
|
|
|
|
|
|
|
|
|
|
Cost of goods sold
and other revenues reconciliation:
|
|
|
|
|
|
|
|
|
GAAP cost of goods
sold and Cost of Other revenues
|
|
$
665
|
|
$
730
|
|
$
2,611
|
|
$
2,585
|
% of GAAP
total revenues
|
|
28%
|
|
26%
|
|
27%
|
|
25%
|
Fair value inventory
amortization step-up resulting from acquisitions (b)
|
|
-
|
|
(36)
|
|
(38)
|
|
(134)
|
Depreciation resulting
from a PP&E step-up resulting from acquisitions (b)
(m)
|
|
-
|
|
(7)
|
|
(6)
|
|
(24)
|
Integration related
inventory and technology transfer costs (a)
|
|
1
|
|
(13)
|
|
(9)
|
|
(23)
|
Philidor Rx Services,
LLC Cost of goods sold through deconsolidation as of
January 31, 2016 (a)
|
|
|
|
(2)
|
|
|
|
(2)
|
Other cost of goods
sold (a)
|
|
-
|
|
-
|
|
(1)
|
|
-
|
Adjusted cost of
goods and Cost of Other revenues (non-GAAP) (m)
|
|
$
666
|
|
$
672
|
|
$
2,557
|
|
$
2,402
|
% of
Non-GAAP total revenues
|
|
28%
|
|
24%
|
|
26%
|
|
23%
|
|
|
|
|
|
|
|
|
|
Selling, general
and administrative reconciliation:
|
|
|
|
|
|
|
|
|
GAAP selling, general
and administrative
|
|
$
665
|
|
$
743
|
|
$
2,810
|
|
$
2,700
|
% of GAAP
total revenues
|
|
28%
|
|
27%
|
|
29%
|
|
26%
|
Depreciation resulting
from a PP&E step-up resulting from acquisitions (b)
(m)
|
|
-
|
|
(1)
|
|
(1)
|
|
(4)
|
Gain/(loss) on
disposal of fixed assets (a)
|
|
-
|
|
-
|
|
-
|
|
(8)
|
CEO termination costs
(a)
|
|
-
|
|
-
|
|
(35)
|
|
-
|
Legal and other
professional fees (a)(k)
|
|
(7)
|
|
(1)
|
|
(65)
|
|
(1)
|
Accelerated
depreciation due to fixed assets write-offs acquired from Salix
Pharmaceuticals, Ltd. (a)
|
|
-
|
|
-
|
|
(7)
|
|
-
|
Philidor Rx Services,
LLC expenses through deconsolidation as of January 31, 2016
(a)
|
|
-
|
|
(65)
|
|
(5)
|
|
(65)
|
Previously accelerated
vesting of certain share-based equity instruments (a)
(m)
|
|
-
|
|
6
|
|
2
|
|
(11)
|
Other SG&A
(a)
|
|
-
|
|
-
|
|
(1)
|
|
-
|
Adjusted selling,
general and administrative (non-GAAP) (m)
|
|
$
658
|
|
$
682
|
|
$
2,698
|
|
$
2,611
|
% of
Non-GAAP total revenues
|
|
27%
|
|
25%
|
|
28%
|
|
25%
|
|
|
|
|
|
|
|
|
|
Research and
development reconciliation:
|
|
|
|
|
|
|
|
|
GAAP research and
development
|
|
$
93
|
|
$
95
|
|
$
421
|
|
$
334
|
% of GAAP
total revenues
|
|
4%
|
|
3%
|
|
4%
|
|
3%
|
Depreciation resulting from a PP&E step-up resulting from
acquisitions (b) (m)
|
|
-
|
|
-
|
|
(1)
|
|
(1)
|
Settlement of certain disputed invoices related to transition
services (a)
|
|
-
|
|
-
|
|
(16)
|
|
-
|
Adjusted research and
development (non-GAAP) (m)
|
|
$
93
|
|
$
95
|
|
$
404
|
|
$
333
|
% of
Non-GAAP total revenues
|
|
4%
|
|
3%
|
|
4%
|
|
3%
|
|
|
|
|
|
|
|
|
|
Amortization of
finite-lived intangible assets reconciliation:
|
|
|
|
|
|
|
|
|
GAAP Amortization of
finite-lived intangible assets
|
|
$
657
|
|
$
670
|
|
$
2,673
|
|
$
2,257
|
Amortization of
finite-lived intangible assets (c)
|
|
(657)
|
|
(670)
|
|
(2,673)
|
|
(2,257)
|
Adjusted Amortization
of finite-lived intangible assets (non-GAAP)
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
-
|
|
|
|
|
|
|
|
|
|
Goodwill
impairment reconciliation:
|
|
|
|
|
|
|
|
|
GAAP Goodwill
impairment
|
|
$
28
|
|
$
-
|
|
$
1,077
|
|
$
-
|
Goodwill impairment
(d)
|
|
(28)
|
|
-
|
|
(1,077)
|
|
-
|
Adjusted Goodwill
impairment (non-GAAP)
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
-
|
|
|
|
|
|
|
|
|
|
Restructuring and
integration costs reconciliation:
|
|
|
|
|
|
|
|
|
GAAP Restructuring
and integration costs (See Table 4.2)
|
|
$
54
|
|
$
88
|
|
$
132
|
|
$
362
|
Restructuring and
integration costs (e)
|
|
(54)
|
|
(88)
|
|
(132)
|
|
(362)
|
Adjusted
Restructuring and integration costs (non-GAAP)
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
-
|
|
|
|
|
|
|
|
|
|
In-process
research and development costs reconciliation:
|
|
|
|
|
|
|
|
|
GAAP in-process
research and development costs
|
|
$
-
|
|
$
106
|
|
$
34
|
|
$
106
|
In-process research
and development costs (f)
|
|
-
|
|
(106)
|
|
(34)
|
|
(106)
|
Adjusted in-process
research and development costs (non-GAAP)
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
-
|
|
|
|
|
|
|
|
|
|
Asset Impairments
reconciliation:
|
|
|
|
|
|
|
|
|
GAAP Asset
Impairments
|
|
$
28
|
|
$
153
|
|
$
422
|
|
$
304
|
Asset Impairments
(n)
|
|
(28)
|
|
(153)
|
|
(422)
|
|
(304)
|
Adjusted Asset
Impairments (non-GAAP)
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
-
|
|
|
|
|
|
|
|
|
|
Acquisition-related contingent consideration
reconciliation:
|
|
|
|
|
|
|
|
|
GAAP
acquisition-related contingent consideration
|
|
$
(31)
|
|
$
(46)
|
|
$
(13)
|
|
$
(23)
|
Acquisition-related
contingent consideration (b)
|
|
31
|
|
46
|
|
13
|
|
23
|
Adjusted
acquisition-related contingent consideration (non-GAAP)
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
-
|
|
|
|
|
|
|
|
|
|
Other expense
reconciliation:
|
|
|
|
|
|
|
|
|
GAAP other
expense
|
|
$
93
|
|
$
51
|
|
$
73
|
|
$
295
|
Legal settlements and
related fees (a) (l)
|
|
(91)
|
|
(5)
|
|
(59)
|
|
(37)
|
Net gain/(loss) on
sale of assets (a)
|
|
(2)
|
|
5
|
|
7
|
|
(8)
|
Acquisition related
transaction costs (a)
|
|
-
|
|
(9)
|
|
(2)
|
|
(39)
|
Post-combination
expense related to acceleration of unvested stock for Salix
employees (a)
|
|
-
|
|
(15)
|
|
-
|
|
(183)
|
Other (primarily loss
recognized upon deconsolidation of Philidor Rx Services, LLC as of
January 31, 2016) (a)
|
|
-
|
|
(28)
|
|
(19)
|
|
(28)
|
Adjusted other
(income) expense (non-GAAP)
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
-
|
|
|
|
|
|
|
|
|
|
Interest expense,
net reconciliation:
|
|
|
|
|
|
|
|
|
GAAP interest
expense, net
|
|
$
(465)
|
|
$
(431)
|
|
$(1,828)
|
|
$
(1,559)
|
Amortization of debt
discounts (g)
|
|
24
|
|
17
|
|
99
|
|
61
|
Amortization of
deferred financing costs (g)
|
|
5
|
|
3
|
|
15
|
|
11
|
Interest expense
resulting from acquisition of Salix Pharmaceuticals, Ltd.
(g)
|
|
-
|
|
6
|
|
-
|
|
14
|
Write-down of
deferred financing costs (g)
|
|
-
|
|
1
|
|
4
|
|
73
|
Adjusted interest
expense, net (non-GAAP)
|
|
$
(436)
|
|
$
(404)
|
|
$(1,710)
|
|
$
(1,400)
|
|
|
|
|
|
|
|
|
|
Loss on
extinguishment of debt reconciliation:
|
|
|
|
|
|
|
|
|
GAAP loss on
extinguishment of debt
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
(20)
|
Loss on
extinguishment of debt (h)
|
|
-
|
|
-
|
|
-
|
|
20
|
Adjusted loss on
extinguishment of debt (non-GAAP)
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
-
|
|
|
|
|
|
|
|
|
|
Foreign exchange
and other reconciliation:
|
|
|
|
|
|
|
|
|
GAAP foreign exchange
and other
|
|
$
(46)
|
|
$
(3)
|
|
$
(41)
|
|
$
(103)
|
Foreign exchange
loss/gain on intercompany financing arrangements (i)
|
|
28
|
|
(2)
|
|
14
|
|
68
|
Unrealized foreign
exchange loss relating to foreign currency forward-exchange
contracts (i)
|
|
-
|
|
-
|
|
-
|
|
27
|
Adjusted foreign
exchange and other (non-GAAP)
|
|
$
(18)
|
|
$
(5)
|
|
$
(27)
|
|
$
(8)
|
|
|
|
|
|
|
|
|
|
Provision for
(recovery of) income taxes reconciliation:
|
|
|
|
|
|
|
|
|
GAAP Provision for
(recovery of) income taxes
|
|
$
152
|
|
$
119
|
|
$
(27)
|
|
$
133
|
Effective
GAAP tax rate
|
|
42%
|
|
45%
|
|
1%
|
|
86%
|
Tax
effect of non-GAAP adjustments (j)
|
|
(64)
|
|
235
|
|
386
|
|
710
|
Adjusted Provision
for income taxes (non-GAAP)
|
|
$
88
|
|
$
354
|
|
$
359
|
|
$
843
|
Effective
Non-GAAP tax rate
|
|
17%
|
|
40%
|
|
16%
|
|
23%
|
|
|
|
|
|
|
|
|
|
(a) Represents a
component of the non-GAAP adjustment of "Other non-GAAP charges"
(see Table 2). The identified components, in the aggregate,
represent all components of this non-GAAP adjustment.
|
(b) Represents a
component of the non-GAAP adjustment of "Acquisition-related
adjustments excluding amortization of finite-lived intangible
assets" (see Table 2). The identified components, in the aggregate,
represent all components of this non-GAAP adjustment.
|
(c) Represents the
sole component of the non-GAAP adjustment of "Amortization of
finite-lived intangible assets" (see Table
2).
|
(d) Represents the
sole component of the non-GAAP adjustment of "Goodwill impairment"
(see Table 2).
|
(e) Represents the
sole component of the non-GAAP adjustment of "Restructuring and
Integration costs" (see Table 2).
|
(f) Represents the
sole component of the non-GAAP adjustment of "In-process research
and development costs" (see Table 2). For the twelve months
ended December 31, 2016, in-process research and development
expense of $34 million, was primarily related to a payment of $25
million in the third quarter of 2016 in connection with the license
of NER1006. For the twelve months ended December 31,
2015, in-process research and development expense of $106 million
was primarily related to the $100 million upfront payment in
connection with the license of brodalumab.
|
(g) Represents a
component of the non-GAAP adjustment of "Amortization of deferred
financing costs and debt discounts" (see Table 2). The identified
components, in the aggregate, represent all components of this
non-GAAP adjustment.
|
(h) Represents the
sole component of the non-GAAP adjustment of "Loss on
extinguishment of debt" (see Table 2).
|
(i) Represents a
component of the non-GAAP adjustment of "foreign exchange and
other" (see Table 2). The identified components, in the aggregate,
represent all components of this non-GAAP adjustment.
|
(j) Represents the
sole component of the non-GAAP adjustment of "Tax effect of
non-GAAP adjustments" (see Table 2).
|
(k) Legal and other
professional fees incurred in connection with recent legal and
governmental proceedings, investigations and information requests
related to, among other matters, our distribution, marketing,
pricing, disclosure and accounting practices for the three and
twelve months ended December 31, 2016.
|
(l) For the twelve
months ended December 31, 2016, legal settlements and related fees
includes an unfavorable adjustment of $90 million from the proposed
settlement from Salix securities litigation, partially offset by a
favorable adjustment of $39 million from settlement of the
investigation into Salix's pre-acquisition sales and promotional
practices for the Xifaxan®, Relistor® and Apriso® products.
For the twelve months ended December 31, 2015, legal settlement and
related fees includes a charge of $25 million recognized in the
third quarter of 2015 related to the AntiGrippin®
litigation.
|
(m) As of the third
quarter of 2016, Adjusted net income (non-GAAP) and Adjusted EPS
(non-GAAP) no longer include adjustments for the following items:
Depreciation resulting from a PP&E step-up resulting from
acquisitions; and Previously accelerated vesting of certain
share-based equity adjustments. Depreciation resulting from a
PP&E step-up resulting from acquisitions was a component of
Acquisition-related adjustments excluding amortization of
finite-lived intangible assets. Previously accelerated vesting of
certain share-based equity adjustments was a component of Other
non-GAAP charges. For the purpose of allowing investors to evaluate
Adjusted net income (non-GAAP) and Adjusted EPS (non-GAAP) on a
consistent basis for the periods presented, the aggregate amounts
of each of Depreciation resulting from a PP&E step-up resulting
from acquisitions, and Previously accelerated vesting of certain
share-based equity adjustments in the fourth quarter of 2016 were
$3 million and ($2) million, respectively and for the twelve months
ended December 31, 2016 were $13 million and ($6) million,
respectively.
|
(n) Represents the
sole component of the non-GAAP adjustment of "Asset Impairments"
(see Table 2). Asset impairments were $422 million for 2016 and
included (i) $199 million related to Ruconest®, (ii) $25 million
related to IBSChek™, (iii) $14 million related to the termination
of the development program for Cirle 3-dimensional surgical
navigation technology, and (iv) impairment to other assets that
individually were not material. Asset impairments were $304 million
for 2015 and included (i) $90 million in the third quarter related
to the Rifaximin SSD development program based on analysis of Phase
2 study data, (ii) $79 million in connection with the termination
of the arrangements with and relating to Philidor, (iii) $28
million in the fourth quarter related to the Emerade® program in
the U.S. based on analysis of feedback received from the FDA, (iv)
$27 million related to the remaining intangible asset for
ezogabine/retigabine (immediate-release formulation) resulting from
declining sales trends, (v) $26 million related to Zelapar®
resulting from declining sales trends, and (vi) $12 million in the
second quarter related to the Arestin® Peri-Implantitis development
program based on analysis of Phase 3 study data.
|
Valeant
Pharmaceuticals International, Inc.
|
|
Table
2b
|
Reconciliation of
GAAP Net Income to Adjusted EBITDA (non-GAAP)
|
For the Three and
Twelve Months Ended December 31, 2016 and 2015
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(non-GAAP)
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
|
|
December
31,
|
|
December
31,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Net loss
attributable to Valeant Pharmaceuticals International,
Inc.
|
|
$
(515)
|
|
$
(385)
|
|
$
(2,409)
|
|
$
(292)
|
|
Interest expense,
net
|
|
465
|
|
431
|
|
1,828
|
|
1,559
|
|
(Recovery of)
provision for income taxes
|
|
152
|
|
119
|
|
(27)
|
|
133
|
|
Depreciation and
amortization
|
|
707
|
|
741
|
|
2,866
|
|
2,467
|
EBITDA
|
|
$
809
|
|
$
906
|
|
$
2,258
|
|
$
3,867
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Goodwill
impairment
|
|
28
|
|
-
|
|
1,077
|
|
-
|
|
Restructuring and
integration costs
|
|
54
|
|
86
|
|
132
|
|
360
|
|
In-process research
and development costs
|
|
-
|
|
106
|
|
34
|
|
106
|
|
Asset
Impairments
|
|
28
|
|
153
|
|
422
|
|
304
|
|
Share-based
compensation
|
|
30
|
|
29
|
|
165
|
|
140
|
|
Acquisition-related
adjustments excluding amortization of finite-lived intangible
assets, net of depreciation expense
|
(31)
|
|
(8)
|
|
25
|
|
112
|
|
Loss on
extinguishment of debt
|
|
-
|
|
-
|
|
-
|
|
20
|
|
Foreign exchange and
other
|
|
28
|
|
(2)
|
|
14
|
|
95
|
|
Other non-GAAP
charges (a)
|
|
99
|
|
104
|
|
178
|
|
365
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(non-GAAP)
|
|
$
1,045
|
|
$
1,374
|
|
$
4,305
|
|
$
5,369
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Other non-GAAP
charges for the three and twelve months ending December 31,
2016 and 2015 include:
|
|
$
99
|
|
$
104
|
|
$
178
|
|
$
365
|
|
Integration related
inventory and technology transfer costs
|
|
(1)
|
|
13
|
|
9
|
|
23
|
|
CEO termination costs
(cash severance payment)
|
|
-
|
|
-
|
|
10
|
|
-
|
|
Legal and other
professional fees
|
|
7
|
|
7
|
|
65
|
|
7
|
|
Settlement of certain
disputed invoices related to transition services
|
|
-
|
|
-
|
|
16
|
|
-
|
|
Legal settlements and
related fees
|
|
91
|
|
5
|
|
59
|
|
37
|
|
Net (gain)/loss on
sale of assets
|
|
2
|
|
(5)
|
|
(7)
|
|
8
|
|
Gain/loss on disposal
of fixed assets
|
|
-
|
|
-
|
|
-
|
|
8
|
|
Acquisition related
transaction costs
|
|
-
|
|
9
|
|
2
|
|
39
|
|
Post-combination
expense related to acceleration of unvested stock for Salix
employees
|
|
-
|
|
15
|
|
-
|
|
183
|
|
Philidor Rx Services,
LLC net loss through deconsolidation as of January 31,
2016
|
|
-
|
|
39
|
|
3
|
|
39
|
|
Other
|
|
-
|
|
21
|
|
21
|
|
21
|
Valeant
Pharmaceuticals International, Inc.
|
|
Table
3
|
Statement of
Revenues - by Segment
|
For the Three and
Twelve Months Ended December 31, 2016 and 2015
|
(unaudited)
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
December
31,
|
Revenues
|
|
2016 GAAP
|
|
2015 GAAP
|
|
% Change
|
|
2016 currency impact and other (a)
|
|
2016 excluding currency impact and other
non-GAAP (b)
|
|
% Change
|
Bausch &
Lomb / International
|
|
$ 1,176
|
|
$
1,187
|
|
-1%
|
|
$
44
|
|
$
1,220
|
|
3%
|
Branded Rx
|
|
829
|
|
1,002
|
|
-17%
|
|
-
|
|
829
|
|
-17%
|
U.S. Diversified
Products
|
|
398
|
|
568
|
|
-30%
|
|
-
|
|
398
|
|
-30%
|
Total
revenues
|
|
$ 2,403
|
|
$
2,758
|
|
-13%
|
|
$
44
|
|
$
2,447
|
|
-11%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve
Months Ended
|
|
|
December
31,
|
Revenues
|
|
2016 GAAP
|
|
2015 GAAP
|
|
% Change
|
|
2016 currency impact and other (a)
|
|
2016 excluding currency impact and other
non-GAAP (b)
|
|
% Change
|
Bausch &
Lomb / International
|
|
$ 4,607
|
|
$
4,603
|
|
0%
|
|
$
150
|
|
$
4,757
|
|
3%
|
Branded Rx
|
|
3,148
|
|
3,582
|
|
-12%
|
|
9
|
|
3,157
|
|
-12%
|
U.S. Diversified
Products
|
|
1,919
|
|
2,262
|
|
-15%
|
|
-
|
|
1,919
|
|
-15%
|
Total
revenues
|
|
$ 9,674
|
|
$ 10,447
|
|
-7%
|
|
$
159
|
|
$
9,833
|
|
-6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Currency effect
for constant currency sales is determined by comparing 2016
reported amounts adjusted to exclude currency impact, calculated
using 2015 monthly average exchange rates, to the actual 2015
(restated) reported amounts. Product sales of $2 million
represent Philidor Rx Services, LLC sales through the
deconsolidation as of January 31, 2016.
|
(b) To
supplement the financial measures prepared in accordance with U.S.
generally accepted accounting principles (GAAP), the Company uses
certain non-GAAP financial measures. For additional information
about the Company's use of such non-GAAP financial measures, please
refer to the body of the press release to which these tables are
attached.
|
|
Valeant
Pharmaceuticals International, Inc.
|
|
Table
4
|
|
Consolidated
Balance Sheet and Other Data (unaudited)
|
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
As
of
|
|
As
of
|
|
|
|
|
December
31,
|
|
December
31,
|
4.1
|
|
|
|
2016
|
|
2015
|
|
Cash
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
542
|
|
$
597
|
|
|
|
|
|
|
|
|
Debt
|
|
|
|
|
|
Revolving Credit
Facility
|
|
$
875
|
|
$
250
|
|
Series A-1 Tranche A
Term Loan Facility
|
|
-
|
|
140
|
|
Series A-2 Tranche A
Term Loan Facility
|
|
-
|
|
137
|
|
Series A-3 Tranche A
Term Loan Facility
|
|
1,016
|
|
1,882
|
|
Series A-4 Tranche A
Term Loan Facility
|
|
658
|
|
951
|
|
Series D-2 Tranche B
Term Loan Facility
|
|
1,048
|
|
1,088
|
|
Series C-2 Tranche B
Term Loan Facility
|
|
805
|
|
835
|
|
Series E-1 Tranche B
Term Loan Facility
|
|
2,429
|
|
2,531
|
|
Series F Tranche B
Term Loan Facility
|
|
3,815
|
|
4,056
|
|
Senior
Notes
|
|
19,188
|
|
19,206
|
|
Other
|
|
12
|
|
12
|
|
|
|
|
29,846
|
|
31,088
|
|
Less: current
portion
|
|
(1)
|
|
(823)
|
|
Total long-term
debt
|
|
$
29,845
|
|
$
30,265
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
December
31,
|
|
GAAP Cash
Flow
|
|
2016
|
|
2015
|
|
GAAP Cash Flow from
Operations
|
|
$
513
|
|
$
598
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4.2
|
Restructuring and
integration costs
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
December 31,
2016
|
|
by project
type
|
|
Cash
Paid
|
|
Expensed
|
|
|
|
|
|
|
|
|
Restructuring
Initiatives
|
|
|
$
-
|
|
$
24
|
|
Salix
Pharmaceuticals, Ltd.
|
|
|
9
|
|
23
|
|
Other (various
deals)
|
|
|
10
|
|
7
|
|
|
|
|
|
|
|
|
Total
|
|
|
$
19
|
|
$
54
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
by expense
type
|
|
Cash
Paid
|
|
Expensed
|
|
|
|
|
|
|
|
|
Consulting,
duplicative labor, transition services, and other
|
|
|
$
9
|
|
$
35
|
|
Severance
payments
|
|
|
6
|
|
17
|
|
Facility closure
costs and non-personnel manufacturing integration
|
|
|
4
|
|
2
|
|
Total
|
|
$
19
|
|
$
54
|
Valeant
Pharmaceuticals International, Inc.
|
|
Table
5
|
Organic Growth
(non-GAAP) - by Segment
|
For the Three
Months Ended December 31, 2016
|
(In
Millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
reported
|
|
For the
Three Months Ended December 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic
growth
|
|
(1)
Q4 2016
|
(2)
Acq impact
|
(3) Q4
2016 Same
store
|
|
(4) Q4
2015
|
(5)
Pro Forma
Adj
|
(6)
Q4 2015
|
|
(7) Currency impact Same store (a)
|
(8) Currency impact Acq (a)
|
|
(9)
Divestitures / Discontinuations
|
|
Pro
Forma (1)+(7)+(8) /
(6)-(9) (b)
(c)
|
|
Same
store (3)+(7) /
(4)-(9) (b)
(c)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bausch &
Lomb / International
|
1,164
|
13
|
1,151
|
|
1,175
|
16
|
1,191
|
|
42
|
2
|
|
8
|
|
2%
|
|
2%
|
Branded Rx
|
810
|
-
|
810
|
|
988
|
-
|
988
|
|
-
|
-
|
|
5
|
|
-18%
|
|
-18%
|
U.S. Diversified
Products
|
393
|
-
|
393
|
|
560
|
-
|
560
|
|
-
|
-
|
|
3
|
|
-29%
|
|
-29%
|
Total product
sales (d)
|
$
2,368
|
$
13
|
$
2,355
|
|
$
2,723
|
$
16
|
$
2,739
|
|
$
42
|
$
2
|
|
$
16
|
|
-11%
|
|
-11%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Currency effect
for constant currency sales is determined by comparing 2016
reported amounts adjusted to exclude currency impact, calculated
using 2015 monthly average exchange rates, to the actual 2015
reported amounts.
|
(b) To supplement the
financial measures prepared in accordance with U.S. generally
accepted accounting principles (GAAP), the Company uses certain
non-GAAP financial measures. For additional information about the
Company's use of such non-GAAP financial measures, please refer to
the body of the press release to which these tables are
attached.
|
(c) Organic Growth
Definitions:
|
Pro Forma (PF):
This measure provides year over year growth rates for the entire
business, including those that have been acquired within the last
year.
|
((Current Year Total product sales + YoY FX impact) – (Prior Year
Total product sales + Pro Forma impact of acquisitions within the
last year - divestitures or discontinuations))/(Prior Year
Total product sales + Pro Forma impact of acquisitions within the
last year - divestitures or
discontinuations).
|
Same Store (SS): This
measure provides growth rates for businesses that have been owned
for one year or more.
|
((Current Year Total product sales – acquisitions within the last
year + YoY FX impact)- (Prior Year Total product sales –
divestitures & discontinuations))/( Prior Year Total product
sales – divestitures & discontinuations)
|
(d) Numbers may not
foot due to rounding.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/valeant-reports-fourth-quarter-and-full-year-2016-financial-results-and-provides-2017-guidance-300414532.html
SOURCE Valeant Pharmaceuticals International, Inc.