DUBLIN, Aug. 10, 2017 /PRNewswire/ --
- Delivered second quarter 2017 GAAP ("reported") net sales of
$1.2 billion
- CHC Americas segment reported nets sales of $605 million compared to $630 million last year, lower by 4%; Adjusted net
sales grew 3%, excluding $42 million
from the U.S. VMS business in the prior year
- Second quarter reported net loss of $70 million and reported diluted loss per share
("EPS") of $0.49
- Delivered strong second quarter adjusted net income of
$175 million and adjusted diluted EPS
of $1.22
- CHC International segment profit improvement plan continued
to yield positive results with second quarter reported operating
margin of 1.0% and adjusted operating margin of 14.6%
- RX segment reported second quarter operating margin of
28.8%; the segment's extended topical strategy yielded strong
adjusted operating margin of 46.5%, an improvement of 370 bps
compared to the prior year
- First half 2017 cash flow from operations was $285 million, or a robust $390 million excluding a tax payment of
$74 million and restructuring
payments of $31 million
- Used enhanced balance sheet flexibility to repurchase
approximately 812,000 shares for approximately $58 million in the second quarter
- Reached an agreement to divest Israel Active Pharmaceutical
Ingredient (API) business for $110
million in cash
Outlook:
- The Company now expects calendar year 2017 reported diluted
EPS to be in the range of $0.84 to
$1.09. Given continued positive execution across all of our
business segments, the Company raised its calendar year 2017
adjusted diluted EPS guidance to be in the range of $4.45 to $4.70. This adjusted diluted EPS
guidance range includes the removal of approximately $0.05 second half expected contribution due to
the sale of the API business.
Perrigo Company plc (NYSE; TASE: PRGO) today announced results
for the second quarter ended July 1, 2017.
Additional GAAP reported results: Reported net sales were lower
in the Consumer Healthcare Americas ("CHCA") and Consumer
Healthcare International ("CHCI") segments by 4% and 9%,
respectively, due primarily to actions taken last year to sell
non-profitable businesses. CHCA reported operating margin was
17.2%.
Perrigo CEO John T. Hendrickson
commented, "We are very pleased with the performance across all
segments this quarter, and these results demonstrate the Company's
continued positive execution in our businesses. Two key governing
principles I have discussed over the past year for Perrigo are
operational excellence and being action orientated. Operational
excellence was once again visible in our results this quarter. Our
CHCA segment delivered solid adjusted net sales growth of
approximately 3% in both the second quarter and over the last
twelve months. For the sixth consecutive quarter, adjusted
operating margin in this business has remained above 20%. Our CHCI
segment delivered an impressive 4% net sales growth in the quarter,
on a constant currency basis and excluding the exited distribution
businesses. RX adjusted operating margin was a solid 47%, 370 bps
higher than the prior year. Finally, our durable business model and
efficient supply chain delivered strong cash flow through the first
half of the year.
The second principle, being action oriented, was evidenced by
the following actions this quarter: 1) execution of our cost
optimization program, which is on track to deliver annual cost
savings of greater than $130 million
by the middle of 2018; 2) advancement of our debt pay down strategy
by concluding the $1.4 billion tender
offer during the quarter, which provides greater optionality and
flexibility to utilize our improved balance sheet as demonstrated
by the $58 million of share
repurchases; and 3) continued refinement of our portfolio through
the announced sale of the Israel API business and the Russia CHC
International business. We continue to capitalize on our unique
business model and are focused on providing Quality Affordable
Healthcare Products® to customers, patients and
families around the globe."
Refer to Tables I - VI at the end of this press release for a
reconciliation of non-GAAP adjustments to the current year and
prior year periods and additional non-GAAP information. The
Company's reported results are included in the attached Condensed
Consolidated Statements of Operations, Balance Sheets and
Statements of Cash Flows.
Second Quarter Results
Perrigo Company
plc
|
(in millions,
except earnings per share amounts)
|
(see the attached
Tables I - VI for reconciliation to GAAP numbers)
|
|
|
Second Quarter
Ended
|
|
Second Quarter
Ended
|
|
YoY
|
|
Constant
Currency
|
|
7/1/2017
|
|
7/2/2016
|
|
% change
|
|
% Change
|
Reported Net
Sales
|
$1,238
|
|
$1,341
|
|
(8)
|
%
|
|
|
Reported Net
(Loss)
|
$(70)
|
|
$(534)
|
|
(87)
|
%
|
|
|
Reported Diluted
(Loss) per Share
|
$(0.49)
|
|
$(3.73)
|
|
(87)
|
%
|
|
|
Reported Diluted
Shares
|
143.3
|
|
143.2
|
|
—
|
%
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net
Sales(1)
|
N/A
|
|
$1,297
|
|
(5)
|
%
|
|
(3)
|
%
|
Adjusted Net
Income
|
$175
|
|
$185
|
|
(5)
|
%
|
|
|
Adjusted Diluted
Earnings per Share
|
$1.22
|
|
$1.29
|
|
(5)
|
%
|
|
|
Adjusted Diluted
Shares
|
143.6
|
|
143.6
|
|
—
|
%
|
|
|
(1)
|
Second quarter
2016 net sales have been adjusted to exclude approximately
$44 million of sales attributable to divested businesses,
primarily the U.S. Vitamins Minerals and Supplements (VMS)
business.
|
Reported net sales for the second quarter of 2017 were
$1.2 billion, which included
discontinued products of $10 million and new product sales of
$38 million. Adjusted net sales
grew 2% compared to the prior year excluding: 1) net sales from the
VMS business of $42 million, which was sold in the third
quarter of 2016, 2) net sales from the European distribution
businesses of $39 million, which the
Company exited in 2016, 3) lower year-over-year net sales of
$26 million from Entocort®
and, 4) unfavorable foreign currency movements of $16 million.
Reported net loss was $70 million,
or $0.49 per share versus a net loss
of $534 million, or $3.73 per
diluted share, in the prior year. Excluding charges as outlined in
Table I at the end of this release, second quarter 2017 adjusted
net income was $175 million, or
$1.22 per diluted share, versus
adjusted net income of $185 million,
or $1.29 per diluted share, for the
same period last year.
Segment Results
Consumer
Healthcare Americas (CHCA) Segment
|
(in
millions)
|
(see the attached
Tables I - VI for reconciliation to GAAP numbers)
|
|
|
Second
Quarter
Ended
|
|
Second
Quarter
Ended
|
|
YoY
|
|
Constant
Currency
|
|
7/1/2017
|
|
7/2/2016
|
|
% change
|
|
% Change
|
Reported Net
Sales
|
$605
|
|
|
$630
|
|
|
(4)
|
%
|
|
|
Reported Gross
Profit
|
$204
|
|
|
$220
|
|
|
(7)
|
%
|
|
|
Reported Gross
Margin
|
33.7
|
%
|
|
34.9
|
%
|
|
(120) bps
|
|
|
Reported Operating
Income
|
$104
|
|
|
$117
|
|
|
(11)
|
%
|
|
|
Reported Operating
Margin
|
17.2
|
%
|
|
18.5
|
%
|
|
(130) bps
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net
Sales(1)
|
N/A
|
|
|
$588
|
|
|
3
|
%
|
|
3
|
%
|
Adjusted Gross
Profit
|
$216
|
|
|
$226
|
|
|
(5)
|
%
|
|
|
Adjusted Gross
Margin(2)
|
35.7
|
%
|
|
38.5
|
%
|
|
(280) bps
|
|
|
Adjusted Operating
Income
|
$127
|
|
|
$139
|
|
|
(9)
|
%
|
|
|
Adjusted Operating
Margin(2)
|
21.0
|
%
|
|
23.6
|
%
|
|
(260) bps
|
|
|
(1)
|
Second quarter
2016 net sales have been adjusted to exclude approximately
$42 million of sales attributable to the VMS business, which
was sold in the third quarter 2016.
|
(2)
|
Second quarter
2016 adjusted gross margin and operating margin use adjusted net
sales as the denominator.
|
CHCA second quarter reported net sales were $605 million compared to $630 million last year. Excluding
$42 million from VMS in the prior year, adjusted net sales
grew 3%. This increase was driven by higher sales in the smoking
cessation and dermatologic categories and stronger performance in
our Mexico business compared to
the prior year. New product sales of $13 million were led by
continued strong net sales of the store brand version of
Flonase®, which launched mid-quarter last year. These
positive drivers were partially offset by lower sales primarily in
the animal health, analgesics and cough and cold categories, along
with discontinued products of $3 million.
The CHCA segment achieved second quarter reported gross profit
margin of 33.7% and adjusted gross profit margin of 35.7%.
Sell through of higher margin products in the prior year and
year-over-year price erosion in certain categories were partially
offset by positive contributions from supply chain and
manufacturing efficiencies versus last year.
Reported operating margin was 17.2% and adjusted operating
margin was 21.0%, which was lower compared to the prior year due to
lower gross margin flow through.
Consumer
Healthcare International (CHCI) Segment
|
(in
millions)
|
(see the attached
Tables I - VI for reconciliation to GAAP numbers)
|
|
|
Second
Quarter
Ended
|
|
Second
Quarter
Ended
|
|
YoY
|
|
Constant
Currency
|
|
7/1/2017
|
|
7/2/2016
|
|
% change
|
|
% Change
|
Reported Net
Sales
|
$377
|
|
|
$416
|
|
|
(9)%
|
|
(6)
|
%
|
Reported Gross
Profit
|
$174
|
|
|
$188
|
|
|
(7)%
|
|
|
Reported Gross
Margin
|
46.2
|
%
|
|
45.1
|
%
|
|
110 bps
|
|
|
Reported Operating
Income (Loss)
|
$4
|
|
|
$1
|
|
|
547%
|
|
|
Reported Operating
Margin
|
1.0
|
%
|
|
0.1
|
%
|
|
90
|
bps
|
|
|
|
|
|
|
|
|
|
|
Adjusted Gross
Profit
|
$195
|
|
|
$205
|
|
|
(5)%
|
|
|
Adjusted Gross
Margin
|
51.7
|
%
|
|
49.4
|
%
|
|
230
|
bps
|
|
|
Adjusted Operating
Income
|
$55
|
|
|
$57
|
|
|
(3)%
|
|
|
Adjusted Operating
Margin
|
14.6
|
%
|
|
13.6
|
%
|
|
100
|
bps
|
|
|
Reported net sales decreased 9% compared to the second
quarter of 2016. Net sales grew approximately 4% excluding
$39 million from the exited unprofitable European distribution
businesses and unfavorable foreign currency movements of
$16 million. This increase was driven
by new product sales of $19 million
and higher net sales in the allergy, analgesic and cough and cold
categories.
Second quarter reported gross margin was 46.2%, an increase of
110 bps over the previous year. Adjusted gross margin was 51.7%, an
increase of approximately 230 bps over the previous year as the
Company exited the unprofitable distribution businesses.
Reported operating margin was 1.0% compared to 0.1% in the
previous year. Adjusted operating margin was 14.6%, which included
higher advertising and promotional investments as a percentage to
net sales compared to the prior year and lower operating expenses
as a result of cost improvement initiatives.
Prescription
Pharmaceuticals (RX) Segment
|
(in
millions)
|
(see the attached
Tables I - VI for reconciliation to GAAP numbers)
|
|
|
Second
Quarter
Ended
|
|
Second
Quarter
Ended
|
|
YoY
|
|
Constant
Currency
|
|
7/1/2017
|
|
7/2/2016
|
|
% change
|
|
% Change
|
Reported Net
Sales
|
$240
|
|
|
$277
|
|
|
(13)
|
%
|
|
(13)
|
%
|
Reported Gross
Profit
|
$119
|
|
|
$131
|
|
|
(9)
|
%
|
|
|
Reported Gross
Margin
|
49.6
|
%
|
|
47.5
|
%
|
|
210 bps
|
|
|
Reported Operating
Income
|
$69
|
|
|
$93
|
|
|
(25)
|
%
|
|
|
Reported Operating
Margin
|
28.8
|
%
|
|
33.5
|
%
|
|
(470) bps
|
|
|
|
|
|
|
|
|
|
|
Adjusted Gross
Profit
|
$141
|
|
|
$157
|
|
|
(10)
|
%
|
|
|
Adjusted Gross
Margin
|
58.8
|
%
|
|
56.8
|
%
|
|
200 bps
|
|
|
Adjusted Operating
Income
|
$112
|
|
|
$119
|
|
|
(6)
|
%
|
|
|
Adjusted Operating
Margin
|
46.5
|
%
|
|
42.8
|
%
|
|
370 bps
|
|
|
Reported net sales in the second quarter were $240 million, a 13% decrease compared to last
year due primarily to lower year-over-year Entocort® net
sales of $26 million and lower sales
of other existing products of $14 million, due primarily to
price erosion, both of which were consistent with our expectations.
Partially offsetting these declines were higher sales volumes of
other existing products and new product sales of
$6 million.
Adjusted gross margin was 58.8%, 200 bps higher than the prior
year as sales of higher margin products and a reduced level of
floor stock adjustments compared to the prior year more than offset
Entocort® competition and price erosion.
Reported operating margin was 28.8%. Adjusted operating margin
was 46.5%, 370 bps higher than the prior year due primarily to
gross margin flow through, the restructuring of the specialty
pharma sales force and timing of R&D investments. Adjusted
operating income grew by 21%, or $19
million, excluding the effect of Entocort®.
Guidance
The Company now expects calendar year 2017 reported diluted EPS
to be in the range of $0.84 to
$1.09. Given continued positive execution across all of our
business segments, the Company raised its calendar year 2017
adjusted diluted EPS guidance to be in the range of $4.45 to $4.70. This adjusted diluted EPS
guidance range includes the removal of approximately $0.05 second half expected contribution due to
the sale of the API business.
Conference Call
The Company will host a conference call at 8:00 a.m.
ET (5:00 a.m. PT), August
10, 2017. The conference call will be available live via webcast to
interested parties in the investor relations section of the Perrigo
website at http://perrigo.investorroom.com/events-webcasts or by
phone at 877-248-9413, International 973-582-2737, and reference ID
#58567537. A taped replay of the call will be available beginning
at approximately 12:00 p.m. (ET) Thursday,
August 10, until midnight Sunday,
August 20, 2017. To listen to the replay, dial 800-585-8367,
International 404-537-3406, and use access code 58567537.
About Perrigo
Perrigo Company plc, a leading global healthcare company,
delivers value to its customers and consumers by providing
Quality Affordable Healthcare Products®. Founded
in 1887 as a packager of home remedies, Perrigo has built a unique
business model that is best described as the convergence of a
fast-moving consumer goods company, a high-quality pharmaceutical
manufacturing organization and a world-class supply chain network.
Perrigo is the world's largest manufacturer of over-the-counter
("OTC") healthcare products and supplier of infant formulas for the
store brand market. The Company also is a leading provider of
branded OTC products throughout Europe and the U.S., as well as a leading
producer of "extended topical" prescription drugs. Perrigo,
headquartered in Ireland, sells
its products primarily in North
America and Europe, as well
as in other markets, including Australia, Israel and China. Visit Perrigo online at
(http://www.perrigo.com).
Forward-Looking Statements
Certain statements in this press release are "forward-looking
statements." These statements relate to future events or the
Company's future financial performance and involve known and
unknown risks, uncertainties and other factors that may cause the
actual results, levels of activity, performance or achievements of
the Company or its industry to be materially different from those
expressed or implied by any forward-looking statements. In some
cases, forward-looking statements can be identified by terminology
such as "may," "will," "could," "would," "should," "expect,"
"plan," "anticipate," "intend," "believe," "estimate," "predict,"
"potential" or the negative of those terms or other comparable
terminology. The Company has based these forward-looking statements
on its current expectations, assumptions, estimates and
projections. While the Company believes these expectations,
assumptions, estimates and projections are reasonable, such
forward-looking statements are only predictions and involve known
and unknown risks and uncertainties, many of which are beyond the
Company's control, including: the timing, amount and cost of any
share repurchases; future impairment charges; the success of
management transition; customer acceptance of new products;
competition from other industry participants, some of whom have
greater marketing resources or larger market shares in certain
product categories than the Company does; pricing pressures from
customers and consumers; potential third-party claims and
litigation, including litigation relating to the Company's
restatement of previously-filed financial information; potential
impacts of ongoing or future government investigations and
regulatory initiatives; general economic conditions; fluctuations
in currency exchange rates and interest rates; the consummation of
announced acquisitions or dispositions, and the Company's ability
to realize the desired benefits thereof; the Company's ability to
achieve its guidance; and the Company's ability to execute and
achieve the desired benefits of announced cost-reduction efforts
and other initiatives. In addition, the Company may identify
and be unable to remediate one or more material weaknesses in its
internal control over financial reporting. Furthermore, the Company
and/or its subsidiaries may incur additional tax liabilities in
respect of 2016 and prior years as a result of any restatement or
may be found to have breached certain provisions of Irish company
legislation in respect of prior financial statements and if so may
incur additional expenses and penalties. These and other important
factors, including those discussed under "Risk Factors" in the
Company's Form 10-K for the year ended December 31, 2016, as
well as the Company's subsequent filings with the United States
Securities and Exchange Commission, may cause actual results,
performance or achievements to differ materially from those
expressed or implied by these forward-looking statements. The
forward-looking statements in this press release are made only as
of the date hereof, and unless otherwise required by applicable
securities laws, the Company disclaims any intention or obligation
to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise.
Non-GAAP
Measures
This press release contains certain non-GAAP measures. A
"non-GAAP financial measure" is defined as a numerical measure of a
company's financial performance that excludes or includes amounts
different from the most directly comparable measure calculated and
presented in accordance with U.S. Generally Accepted Accounting
Principles (GAAP) in the statements of operations, balance sheets
or statements of cash flows of the Company. Pursuant to the
requirements of the U.S. Securities and Exchange Commission, the
Company has provided reconciliations for net sales on a constant
currency basis, net sales excluding sales attributable to
held-for-sale businesses, the European distribution businesses,
Entocort® and, adjusted gross profit, adjusted operating
income, adjusted net income, adjusted diluted earnings per share,
adjusted gross margin, adjusted operating margin, and adjusted
diluted shares within this press release to the most directly
comparable U.S. GAAP measures for these non-GAAP measures. These
non-GAAP financial measures should be considered as supplements to
the GAAP reported measures, should not be considered replacements
for, or superior to the GAAP measures and may not be comparable to
similarly named measures used by other companies.
The Company provides non-GAAP financial measures as additional
information that it believes is useful to investors and analysts in
evaluating the performance of the Company's ongoing operating
trends, facilitating comparability between periods and companies in
similar industries and assessing the Company's prospects for future
performance. These non-GAAP financial measures exclude items, such
as impairment charges, restructuring charges, and acquisition and
integration-related charges, that by their nature affect
comparability of operational performance or that we believe obscure
underlying business operational trends. The non-GAAP measures the
Company provides are consistent with how management analyzes and
assesses the operating performance of the Company, and disclosing
them provides investor insight into management's view of the
business. Management uses these adjusted financial measures for
planning and forecasting in future periods, and evaluating segment
and overall operating performance. In addition, management uses
certain of the profit measures as factors in determining
compensation.
Non-GAAP measures related to profit measurements, which include
adjusted gross profit, adjusted operating income, adjusted net
income, and adjusted diluted earnings per share, are useful to
investors as they provide them with supplemental information to
enhance their understanding of the Company's underlying business
performance and trends, and enhance the ability of investors and
analysts to compare the Company's period-to-period financial
results. Management believes that adjusted gross margin and
adjusted operating margin are useful to investors, in addition to
the reasons discussed above, by allowing them to more easily
compare and analyze trends in the Company's peer business group and
assisting them in comparing the Company's overall performance to
that of its competitors. The Company discloses adjusted net sales,
which excludes operating results attributable to held-for-sale
businesses, the European distribution businesses and
Entocort® in order to provide information about sales of
the Company's continuing business. In addition, the Company
discloses net sales growth and adjusted net sales growth on a
constant currency basis to provide information about sales of the
Company's continuing business excluding the exogenous impact of
foreign exchange. The Company believes these supplemental financial
measures provide investors with consistency in financial reporting,
enabling meaningful comparisons of past, present and future
underlying operating results, and also facilitate comparison of the
Company's operating performance to the operating performance of its
competitors.
A copy of this press release, including the reconciliations, is
available on the Company's website at www.perrigo.com.
PERRIGO COMPANY
PLC
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(in millions, except
per share amounts)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
July 1,
2017
|
|
July 2,
2016
|
|
July 1,
2017
|
|
July 2,
2016
|
Net sales
|
$
|
1,237.9
|
|
|
$
|
1,340.5
|
|
|
$
|
2,431.9
|
|
|
$
|
2,687.8
|
|
Cost of
sales
|
733.3
|
|
|
794.0
|
|
|
1,463.0
|
|
|
1,608.2
|
|
Gross
profit
|
504.6
|
|
|
546.5
|
|
|
968.9
|
|
|
1,079.6
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
Distribution
|
21.6
|
|
|
22.5
|
|
|
42.7
|
|
|
44.3
|
|
Research and
development
|
42.6
|
|
|
47.0
|
|
|
82.3
|
|
|
92.2
|
|
Selling
|
155.6
|
|
|
171.6
|
|
|
310.6
|
|
|
352.4
|
|
Administration
|
98.2
|
|
|
104.3
|
|
|
203.6
|
|
|
211.8
|
|
Impairment
charges
|
27.4
|
|
|
10.5
|
|
|
39.6
|
|
|
414.4
|
|
Restructuring
|
12.1
|
|
|
5.8
|
|
|
50.8
|
|
|
11.3
|
|
Other operating
income
|
(1.7)
|
|
|
—
|
|
|
(38.0)
|
|
|
—
|
|
Total operating
expenses
|
355.8
|
|
|
361.7
|
|
|
691.6
|
|
|
1,126.4
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
148.8
|
|
|
184.8
|
|
|
277.3
|
|
|
(46.8)
|
|
|
|
|
|
|
|
|
|
Change in financial
assets
|
38.7
|
|
|
910.8
|
|
|
21.6
|
|
|
1,115.3
|
|
Interest expense,
net
|
45.1
|
|
|
57.4
|
|
|
98.4
|
|
|
108.6
|
|
Other expense,
net
|
6.1
|
|
|
28.8
|
|
|
2.5
|
|
|
31.3
|
|
Loss on
extinguishment of debt
|
135.2
|
|
|
—
|
|
|
135.2
|
|
|
0.4
|
|
Income (loss) before
income taxes
|
(76.3)
|
|
|
(812.2)
|
|
|
19.6
|
|
|
(1,302.4)
|
|
Income tax expense
(benefit)
|
(6.7)
|
|
|
(277.9)
|
|
|
17.6
|
|
|
(238.9)
|
|
Net income
(loss)
|
$
|
(69.6)
|
|
|
$
|
(534.3)
|
|
|
$
|
2.0
|
|
|
$
|
(1,063.5)
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per
share
|
|
|
|
|
|
|
|
Basic
|
$
|
(0.49)
|
|
|
$
|
(3.73)
|
|
|
$
|
0.01
|
|
|
$
|
(7.43)
|
|
Diluted
|
$
|
(0.49)
|
|
|
$
|
(3.73)
|
|
|
$
|
0.01
|
|
|
$
|
(7.43)
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares outstanding
|
|
|
|
|
|
|
|
Basic
|
143.3
|
|
|
143.2
|
|
|
143.3
|
|
|
143.2
|
|
Diluted
|
143.3
|
|
|
143.2
|
|
|
143.6
|
|
|
143.2
|
|
|
|
|
|
|
|
|
|
Dividends declared
per share
|
$
|
0.160
|
|
|
$
|
0.145
|
|
|
$
|
0.320
|
|
|
$
|
0.290
|
|
PERRIGO COMPANY
PLC
|
CONSOLIDATED
BALANCE SHEETS
|
(in
millions)
|
|
|
July 1,
2017
|
|
December 31,
2016
|
Assets
|
|
|
|
Cash and cash
equivalents
|
$
|
760.8
|
|
|
$
|
622.3
|
|
Accounts receivable,
net of allowance for doubtful accounts of $5.3 million and
$6.3 million, respectively
|
1,065.9
|
|
|
1,176.0
|
|
Inventories
|
818.1
|
|
|
795.0
|
|
Prepaid expenses and
other current assets
|
176.5
|
|
|
212.0
|
|
Total current
assets
|
2,821.3
|
|
|
2,805.3
|
|
Property, plant and
equipment, net
|
876.9
|
|
|
870.1
|
|
Financial
asset
|
—
|
|
|
2,350.0
|
|
Goodwill and other
indefinite-lived intangible assets
|
4,253.0
|
|
|
4,163.9
|
|
Other intangible
assets, net
|
3,373.4
|
|
|
3,396.8
|
|
Non-current deferred
income taxes
|
31.7
|
|
|
72.1
|
|
Other non-current
assets
|
435.9
|
|
|
211.9
|
|
Total non-current
assets
|
8,970.9
|
|
|
11,064.8
|
|
Total
assets
|
$
|
11,792.2
|
|
|
$
|
13,870.1
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
Accounts
payable
|
$
|
480.8
|
|
|
$
|
471.7
|
|
Payroll and related
taxes
|
131.0
|
|
|
115.8
|
|
Accrued customer
programs
|
370.2
|
|
|
380.3
|
|
Accrued
liabilities
|
240.8
|
|
|
263.3
|
|
Accrued income
taxes
|
—
|
|
|
32.4
|
|
Current
indebtedness
|
406.9
|
|
|
572.8
|
|
Total current
liabilities
|
1,629.7
|
|
|
1,836.3
|
|
Long-term debt, less
current portion
|
3,267.9
|
|
|
5,224.5
|
|
Non-current deferred
income taxes
|
368.4
|
|
|
389.9
|
|
Other non-current
liabilities
|
445.0
|
|
|
461.8
|
|
Total non-current
liabilities
|
4,081.3
|
|
|
6,076.2
|
|
Total
liabilities
|
5,711.0
|
|
|
7,912.5
|
|
Commitments and
contingencies - Note 14
|
|
|
|
Shareholders'
equity
|
|
|
|
Controlling
interest:
|
|
|
|
Preferred shares,
$0.0001 par value, 10 million shares authorized
|
—
|
|
|
—
|
|
Ordinary shares,
€0.001 par value, 10 billion shares authorized
|
8,044.7
|
|
|
8,135.0
|
|
Accumulated other
comprehensive income (loss)
|
130.5
|
|
|
(81.8)
|
|
Retained earnings
(accumulated deficit)
|
(2,094.0)
|
|
|
(2,095.1)
|
|
Total controlling
interest
|
6,081.2
|
|
|
5,958.1
|
|
Noncontrolling
interest
|
—
|
|
|
(0.5)
|
|
Total shareholders'
equity
|
6,081.2
|
|
|
5,957.6
|
|
Total liabilities and
shareholders' equity
|
$
|
11,792.2
|
|
|
$
|
13,870.1
|
|
|
|
|
|
Supplemental
Disclosures of Balance Sheet Information
|
|
|
|
Ordinary shares,
issued and outstanding
|
142.6
|
|
|
143.4
|
|
PERRIGO COMPANY
PLC
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(in
millions)
|
(unaudited)
|
|
|
Six Months
Ended
|
|
July 1,
2017
|
|
July 2,
2016
|
Cash Flows From
(For) Operating Activities
|
|
|
|
Net income
(loss)
|
$
|
2.0
|
|
|
$
|
(1,063.5)
|
|
Adjustments to derive
cash flows
|
|
|
|
Depreciation and
amortization
|
220.8
|
|
|
223.7
|
|
Share-based
compensation
|
14.8
|
|
|
9.6
|
|
Impairment
charges
|
39.6
|
|
|
414.4
|
|
Change in financial
assets
|
21.6
|
|
|
1,115.3
|
|
Loss on
extinguishment of debt
|
135.2
|
|
|
0.4
|
|
Restructuring
charges
|
50.8
|
|
|
11.3
|
|
Deferred income
taxes
|
(8.1)
|
|
|
(322.8)
|
|
Amortization of debt
discount (premium)
|
(11.8)
|
|
|
(16.2)
|
|
Other non-cash
adjustments
|
(20.6)
|
|
|
28.1
|
|
Subtotal
|
444.3
|
|
|
400.3
|
|
Increase (decrease)
in cash due to:
|
|
|
|
Accounts
receivable
|
51.8
|
|
|
41.2
|
|
Inventories
|
(4.6)
|
|
|
4.7
|
|
Accounts
payable
|
(6.0)
|
|
|
(47.0)
|
|
Payroll and related
taxes
|
(37.9)
|
|
|
(39.2)
|
|
Accrued customer
programs
|
(13.8)
|
|
|
(44.2)
|
|
Accrued
liabilities
|
(49.4)
|
|
|
(53.9)
|
|
Accrued income
taxes
|
(85.8)
|
|
|
(2.8)
|
|
Other
|
(13.3)
|
|
|
(29.4)
|
|
Subtotal
|
(159.0)
|
|
|
(170.6)
|
|
Net cash from
operating activities
|
285.3
|
|
|
229.7
|
|
Cash Flows From
(For) Investing Activities
|
|
|
|
Proceeds from royalty
rights
|
85.7
|
|
|
169.9
|
|
Acquisitions of
businesses, net of cash acquired
|
—
|
|
|
(419.7)
|
|
Additions to property
and equipment
|
(37.2)
|
|
|
(57.1)
|
|
Net proceeds from
sale of business and other assets
|
37.2
|
|
|
—
|
|
Proceeds from sale of
the Tysabri® royalty stream
|
2,200.0
|
|
|
—
|
|
Other
investing
|
(3.7)
|
|
|
(1.0)
|
|
Net cash from (for)
investing activities
|
2,282.0
|
|
|
(307.9)
|
|
Cash Flows From
(For) Financing Activities
|
|
|
|
Issuances of
long-term debt
|
—
|
|
|
1,190.3
|
|
Payments on long-term
debt
|
(2,229.1)
|
|
|
(28.7)
|
|
Borrowings
(repayments) of revolving credit agreements and other financing,
net
|
—
|
|
|
(803.9)
|
|
Deferred financing
fees
|
(4.0)
|
|
|
(2.4)
|
|
Premium on early debt
retirement
|
(116.1)
|
|
|
—
|
|
Issuance of ordinary
shares
|
0.2
|
|
|
3.5
|
|
Repurchase of
ordinary shares
|
(58.2)
|
|
|
—
|
|
Cash
dividends
|
(46.0)
|
|
|
(41.6)
|
|
Other
financing
|
4.7
|
|
|
(11.7)
|
|
Net cash from (for)
financing activities
|
(2,448.5)
|
|
|
305.5
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
19.7
|
|
|
(3.3)
|
|
Net increase in cash
and cash equivalents
|
138.5
|
|
|
224.0
|
|
Cash and cash
equivalents, beginning of period
|
622.3
|
|
|
417.8
|
|
Cash and cash
equivalents, end of period
|
$
|
760.8
|
|
|
$
|
641.8
|
|
TABLE
I
|
PERRIGO COMPANY
PLC
|
RECONCILIATION OF
NON-GAAP MEASURES
|
SELECTED
CONSOLIDATED INFORMATION
|
(in millions, except
per share amounts)
|
(unaudited)
|
|
|
|
|
|
Three Months Ended
July 1, 2017
|
Consolidated
|
Net
Sales
|
Net Income
(Loss)
|
Diluted
Earnings
(Loss) per Share
|
Reported
|
$
|
1,237.9
|
|
$
|
(69.6)
|
|
$
|
(0.49)
|
|
Adjustments:
|
|
|
|
Loss on early debt
extinguishment
|
|
$
|
135.2
|
|
$
|
0.94
|
|
Amortization expense
related primarily to acquired intangible assets
|
|
88.7
|
|
0.63
|
|
Change in financial
assets
|
|
38.7
|
|
0.27
|
|
Impairment
charges
|
|
27.4
|
|
0.19
|
|
Restructuring
charges
|
|
12.1
|
|
0.08
|
|
Loss on hedges
related to the extinguishment of debt
|
|
5.9
|
|
0.04
|
|
Gain on
divestitures
|
|
(0.9)
|
|
(0.01)
|
|
Unusual
litigation
|
|
(8.8)
|
|
(0.06)
|
|
Acquisition charges
and contingent consideration adjustments
|
|
(0.6)
|
|
—
|
|
Non-GAAP tax
adjustments**
|
|
(52.9)
|
|
(0.37)
|
|
Adjusted
|
|
$
|
175.2
|
|
$
|
1.22
|
|
|
|
|
|
Diluted weighted
average shares outstanding
|
|
|
|
Reported
|
|
|
143.3
|
|
Effect of dilution as
reported amount was a loss, while adjusted amount was
income*
|
0.3
|
|
Adjusted
|
|
|
143.6
|
|
|
|
|
|
*In the period of a
net loss, diluted shares outstanding equal basic shares
outstanding.
|
** The non-GAAP tax
adjustment includes the following: (1) $(41.1) million of tax
effects of pretax non-GAAP adjustments that are calculated based
upon the specific rate of the applicable jurisdiction of the pretax
item; (2) a $(44.3) million effect on non-GAAP income taxes related
to the interim tax accounting requirements within ASC 740, Income
Taxes; (3) $38.1 net impact related to valuation allowances on
deferred tax assets commensurate with non-GAAP pre-tax measures;
and (4) $(5.6) million of tax adjustments related to the
divestiture of the Tysabri® royalty stream.
|
|
|
|
|
|
|
|
|
|
|
TABLE I
(CONTINUED)
|
PERRIGO COMPANY
PLC
|
RECONCILIATION OF
NON-GAAP MEASURES
|
SELECTED
CONSOLIDATED INFORMATION
|
(in millions, except
per share amounts)
|
(unaudited)
|
|
|
|
|
|
Three Months Ended
July 2, 2016
|
Consolidated
|
Net
Sales
|
Net Income
(Loss)
|
Diluted
Earnings
(Loss) per Share
|
Reported
|
$
|
1,340.5
|
|
$
|
(534.3)
|
|
$
|
(3.73)
|
|
Adjustments:
|
|
|
|
Change in financial
assets
|
$
|
—
|
|
$
|
910.8
|
|
$
|
6.36
|
|
Amortization expense
primarily related to acquired intangible assets
|
—
|
|
90.6
|
|
0.63
|
|
Impairment
charges
|
—
|
|
34.6
|
|
0.24
|
|
Restructuring
charges
|
—
|
|
5.8
|
|
0.04
|
|
Acquisition and
integration-related expense
|
—
|
|
3.4
|
|
0.02
|
|
Operating results
attributable to held-for-sale businesses*
|
(43.5)
|
|
2.2
|
|
0.02
|
|
Losses from equity
method investments
|
—
|
|
1.8
|
|
0.01
|
|
Non-GAAP tax
adjustments***
|
—
|
|
(329.7)
|
|
(2.30)
|
|
Adjusted
|
$
|
1,297.0
|
|
$
|
185.2
|
|
$
|
1.29
|
|
|
|
|
|
Diluted weighted
average shares outstanding
|
|
|
|
Reported
|
|
|
143.2
|
|
Effect of dilution as
reported amount was a loss, while adjusted amount was
income**
|
|
|
0.4
|
|
Adjusted
|
|
|
143.6
|
|
|
|
|
|
*Held-for-sale
businesses include the U.S. VMS business, European sports brand,
and India API business.
|
**In the period of a
net loss, diluted shares outstanding equal basic shares
outstanding.
|
*** The non-GAAP tax
adjustment includes the following: (1) $(124.8) million of tax
effects of pretax non-GAAP adjustments that are calculated based
upon the specific rate of the applicable jurisdiction of the pretax
item; and (2) $(204.9) million of tax effects on non-GAAP income
taxes related to the interim tax accounting requirements within ASC
740, Income Taxes. The GAAP tax benefit recorded in the current
quarter related to these items has been excluded from non-GAAP net
income.
|
TABLE
II
|
PERRIGO COMPANY
PLC
|
RECONCILIATION OF
NON-GAAP MEASURES
|
SELECTED SEGMENT
INFORMATION
|
(in
millions)
|
|
|
|
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
July 1,
2017
|
|
July 2,
2016
|
Consumer
Healthcare Americas
|
Net
Sales
|
Gross
Profit
|
Operating
Income
|
|
Net
Sales
|
Gross
Profit
|
Operating
Income
|
Reported
|
$
|
604.9
|
|
$
|
203.8
|
|
$
|
104.2
|
|
|
$
|
629.9
|
|
$
|
220.0
|
|
$
|
116.8
|
|
Adjustments:
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired intangible assets
|
|
$
|
12.1
|
|
$
|
17.0
|
|
|
$
|
—
|
|
$
|
12.5
|
|
$
|
17.6
|
|
Impairment
charges
|
|
—
|
|
4.1
|
|
|
—
|
|
—
|
|
6.2
|
|
Operating results
attributable to held-for-sale business*
|
|
—
|
|
—
|
|
|
(42.1)
|
|
(7.2)
|
|
(3.1)
|
|
Restructuring
charges
|
|
—
|
|
4.3
|
|
|
—
|
|
—
|
|
0.3
|
|
Acquisition charges
and contingent consideration adjustments
|
|
—
|
|
(2.6)
|
|
|
—
|
|
1.0
|
|
1.0
|
|
Adjusted
|
|
$
|
215.9
|
|
$
|
127.0
|
|
|
$
|
587.8
|
|
$
|
226.3
|
|
$
|
138.8
|
|
As a % of reported
net sales (2017) / As a % of adjusted net sales (2016)
|
|
35.7
|
%
|
21.0
|
%
|
|
|
38.5
|
%
|
23.6
|
%
|
|
|
|
|
|
|
|
|
*Held-for-sale
business was the U.S. VMS business, which was sold in Q3
2016.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE II
(CONTINUED)
|
PERRIGO COMPANY
PLC
|
RECONCILIATION OF
NON-GAAP MEASURES
|
SELECTED SEGMENT
INFORMATION
|
(in
millions)
|
|
|
|
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
July 1,
2017
|
|
July 2,
2016
|
Consumer
Healthcare International
|
Net
Sales
|
Gross
Profit
|
Operating
Income
|
|
Net
Sales
|
Gross
Profit
|
Operating
Income
|
Reported
|
$
|
376.5
|
|
$
|
174.0
|
|
$
|
3.9
|
|
|
$
|
415.9
|
|
$
|
187.6
|
|
$
|
0.6
|
|
Adjustments:
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired intangible assets
|
|
$
|
20.8
|
|
$
|
48.9
|
|
|
$
|
—
|
|
$
|
17.1
|
|
$
|
46.6
|
|
Impairment
charges
|
|
—
|
|
3.7
|
|
|
—
|
|
—
|
|
—
|
|
Unusual
litigation
|
|
—
|
|
(8.8)
|
|
|
—
|
|
—
|
|
—
|
|
Operating results
attributable to held-for-sale business*
|
|
—
|
|
—
|
|
|
(0.1)
|
|
0.7
|
|
4.8
|
|
Restructuring
charges
|
|
—
|
|
6.6
|
|
|
—
|
|
—
|
|
4.8
|
|
Acquisition charges
and contingent consideration adjustments
|
|
—
|
|
0.6
|
|
|
—
|
|
—
|
|
(0.2)
|
|
Adjusted
|
|
$
|
194.8
|
|
$
|
54.9
|
|
|
$
|
415.8
|
|
$
|
205.4
|
|
$
|
56.6
|
|
As a % of reported
net sales (2017) / As a % of adjusted net sales (2016)
|
|
51.7
|
%
|
14.6
|
%
|
|
|
49.4
|
%
|
13.6
|
%
|
|
|
|
|
|
|
|
|
*Held-for-sale
business is the European sports brand, which was sold in Q4
2016.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE II
(CONTINUED)
|
PERRIGO COMPANY
PLC
|
RECONCILIATION OF
NON-GAAP MEASURES
|
SELECTED SEGMENT
INFORMATION
|
(in
millions)
|
|
|
|
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
July 1,
2017
|
|
July 2,
2016
|
Prescription
Pharmaceuticals
|
Net
Sales
|
Gross
Profit
|
Operating
Income
|
|
Net
Sales
|
Gross
Profit
|
Operating
Income
|
Reported
|
$
|
240.4
|
|
$
|
119.1
|
|
$
|
69.3
|
|
|
$
|
276.9
|
|
$
|
131.4
|
|
$
|
92.6
|
|
Adjustments:
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired intangible assets
|
|
$
|
22.3
|
|
$
|
22.4
|
|
|
|
$
|
26.0
|
|
$
|
25.9
|
|
Gain on
divestitures
|
|
—
|
|
(1.1)
|
|
|
|
—
|
|
—
|
|
Restructuring
charges
|
|
—
|
|
0.2
|
|
|
|
—
|
|
—
|
|
Impairment
charges
|
|
—
|
|
19.6
|
|
|
|
—
|
|
—
|
|
Acquisition charges
and contingent consideration adjustments
|
|
—
|
|
1.4
|
|
|
|
—
|
|
—
|
|
Adjusted
|
|
$
|
141.4
|
|
$
|
111.8
|
|
|
|
$
|
157.4
|
|
$
|
118.5
|
|
As a % of net
sales
|
|
58.8
|
%
|
46.5
|
%
|
|
|
56.8
|
%
|
42.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE II
(CONTINUED)
|
PERRIGO COMPANY
PLC
|
RECONCILIATION OF
NON-GAAP MEASURES
|
SELECTED SEGMENT
INFORMATION
|
(in
millions)
|
|
|
|
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
April 1,
2017
|
|
April 2,
2016
|
Consumer
Healthcare Americas
|
Net
Sales
|
Gross
Profit
|
Operating
Income
|
|
Net
Sales
|
Gross
Profit
|
Operating
Income
|
Reported
|
$
|
582.8
|
|
$
|
188.4
|
|
$
|
75.0
|
|
|
$
|
639.1
|
|
$
|
196.0
|
|
$
|
100.6
|
|
Adjustments:
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired intangible assets
|
|
$
|
12.4
|
|
$
|
17.1
|
|
|
$
|
—
|
|
$
|
12.8
|
|
$
|
18.1
|
|
Impairment
charges
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
Operating results
attributable to held-for-sale business*
|
|
—
|
|
—
|
|
|
(47.1)
|
|
(7.0)
|
|
(2.5)
|
|
Restructuring
charges
|
|
—
|
|
23.7
|
|
|
—
|
|
—
|
|
1.5
|
|
Acquisition and
integration-related charges
|
|
—
|
|
1.7
|
|
|
—
|
|
2.8
|
|
3.0
|
|
Adjusted
|
|
$
|
200.8
|
|
$
|
117.5
|
|
|
$
|
592.0
|
|
$
|
204.6
|
|
$
|
120.7
|
|
As a % of reported
net sales (2017) / As a % of adjusted net sales (2016)
|
|
34.5
|
%
|
20.2
|
%
|
|
|
34.6
|
%
|
20.4
|
%
|
|
|
|
|
|
|
|
|
*Held-for-sale
business was the U.S. VMS business, which was sold in Q3
2016.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE II
(CONTINUED)
|
PERRIGO COMPANY
PLC
|
RECONCILIATION OF
NON-GAAP MEASURES
|
SELECTED SEGMENT
INFORMATION
|
(in
millions)
|
|
|
|
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
October 1,
2016
|
|
September 26,
2015
|
Consumer
Healthcare Americas
|
Net
Sales
|
Gross
Profit
|
Operating
Income
|
|
Net
Sales
|
Gross
Profit
|
Operating
Income
|
Reported
|
$
|
611.2
|
|
$
|
199.2
|
|
$
|
99.0
|
|
|
$
|
608.3
|
|
$
|
211.6
|
|
$
|
116.2
|
|
Adjustments:
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired intangible assets
|
$
|
—
|
|
$
|
12.5
|
|
$
|
17.6
|
|
|
|
$
|
12.8
|
|
$
|
18.0
|
|
Impairment
charges
|
—
|
|
—
|
|
3.7
|
|
|
|
—
|
|
—
|
|
Operating results
attributable to held-for-sale business*
|
(21.0)
|
|
(3.4)
|
|
(0.1)
|
|
|
|
—
|
|
—
|
|
Restructuring
charges
|
—
|
|
—
|
|
3.9
|
|
|
|
—
|
|
1.9
|
|
Acquisition and
integration-related charges
|
—
|
|
0.8
|
|
1.1
|
|
|
|
—
|
|
(0.5)
|
|
Adjusted
|
$
|
590.2
|
|
$
|
209.1
|
|
$
|
125.2
|
|
|
|
$
|
224.4
|
|
$
|
135.6
|
|
As a % of adjusted
net sales (2016) / As a % of reported net sales (2015)
|
|
35.4
|
%
|
21.2
|
%
|
|
|
36.9
|
%
|
22.3
|
%
|
|
|
|
|
|
|
|
|
For Comparative
Purposes**
|
|
|
|
|
|
|
|
Reported
|
|
|
|
|
$
|
608.3
|
|
|
|
Operating results
attributable to held-for-sale business**
|
|
|
|
|
(40.9)
|
|
|
|
Adjusted
|
|
|
|
|
$
|
567.4
|
|
|
|
|
|
|
|
|
|
|
|
*Held-for-sale
business was the U.S. VMS business, which was sold in Q3
2016.
|
**Q3 2015 net sales
adjustment is made for comparison purposes only and does not change
any other prior year financial information or metrics since the
U.S. VMS business was not held-for-sale in 2015. Q3 2015 gross
margin and operating margin use reported net sales as the
denominator.
|
TABLE II
(CONTINUED)
|
PERRIGO COMPANY
PLC
|
RECONCILIATION OF
NON-GAAP MEASURES
|
SELECTED SEGMENT
INFORMATION
|
(in
millions)
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
December 31,
2016
|
|
December 31,
2015
|
|
Consumer
Healthcare Americas
|
Net
Sales
|
Gross
Profit
|
Operating
Income
|
|
Net
Sales
|
Gross
Profit
|
Operating
Income
|
|
Reported
|
$
|
626.8
|
|
$
|
210.0
|
|
$
|
83.3
|
|
|
$
|
643.2
|
|
$
|
206.2
|
|
$
|
92.8
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
Amortization expense
related primarily to acquired intangible assets
|
|
$
|
12.6
|
|
$
|
17.7
|
|
|
|
$
|
12.2
|
|
$
|
17.9
|
|
|
Unusual
litigation
|
|
—
|
|
10.2
|
|
|
|
—
|
|
0.3
|
|
|
Impairment
charges
|
|
—
|
|
27.1
|
|
|
|
—
|
|
1.5
|
|
|
Restructuring
charges
|
|
—
|
|
(0.1)
|
|
|
|
—
|
|
12.8
|
|
|
Acquisition and
integration-related charges
|
|
—
|
|
1.2
|
|
|
|
—
|
|
—
|
|
|
Adjusted
|
|
$
|
222.6
|
|
$
|
139.4
|
|
|
|
$
|
218.4
|
|
$
|
125.3
|
|
|
As a % of net
sales
|
|
35.5
|
%
|
22.2
|
%
|
|
|
34.0
|
%
|
19.5
|
%
|
|
|
|
|
|
|
|
|
|
|
For Comparative
Purposes*
|
|
|
|
|
|
|
|
|
Reported
|
|
|
|
|
$
|
643.2
|
|
|
|
|
Operating results
attributable to held-for-sale businesses*
|
|
|
|
|
(44.3)
|
|
|
|
|
Adjusted
|
|
|
|
|
$
|
598.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*Q4 2015 net sales
adjustment made for comparison purposes only and does not change
any other prior year financial information or metrics since the
U.S. VMS business was not held-for-sale in 2015. Q4 2015 gross
margin and operating margin use reported net sales as the
denominator.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE
III
|
PERRIGO COMPANY
PLC
|
RECONCILIATION OF
NON-GAAP MEASURES
|
CONSTANT
CURRENCY
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
July 1,
2017
|
|
July 2,
2016
|
|
Total
Change
|
|
FX
Change
|
|
Constant
Currency
Change
|
Net
sales
|
|
|
|
|
|
|
|
|
|
Consolidated*
|
$
|
1,237.9
|
|
|
$
|
1,297.0
|
|
|
(5)%
|
|
2%
|
|
(3)%
|
CHCA*
|
604.9
|
|
|
587.8
|
|
|
3%
|
|
—%
|
|
3%
|
CHCI
|
376.5
|
|
|
415.8
|
|
|
(9)%
|
|
3%
|
|
(6)%
|
RX
|
240.4
|
|
|
276.9
|
|
|
(13)%
|
|
—%
|
|
(13)%
|
|
|
|
|
|
|
|
|
|
|
CHCI
|
$
|
376.5
|
|
|
$
|
415.8
|
|
|
|
|
|
|
|
Less: Belgium
distribution net sales
|
—
|
|
|
(38.6)
|
|
|
|
|
|
|
|
|
$
|
376.5
|
|
|
$
|
377.2
|
|
|
—%
|
|
4%
|
|
4%
|
|
|
|
|
|
|
|
|
|
|
*2016 net sales are
adjusted to exclude sales attributable to held-for-sale businesses.
See Tables I and II for non-GAAP reconciliations.
|
TABLE
IV
|
PERRIGO COMPANY
PLC
|
RECONCILIATION OF
NON-GAAP MEASURES
|
2017
GUIDANCE
|
(unaudited)
|
|
|
|
Full
Year
|
|
|
|
2017 EPS
Guidance
|
|
|
Reported
|
$.84 -
$1.09
|
|
|
Amortization expense
related primarily to acquired intangible assets
|
2.48
|
|
|
Loss on early debt
extinguishment
|
0.94
|
|
|
Restructuring
charges
|
0.39
|
|
|
Impairment
charges
|
0.28
|
|
|
Change in financial
assets
|
0.15
|
|
|
Loss on hedges
related to the
extinguishment of debt
|
0.04
|
|
|
Operating results
attributable to held-for-sale business(1)
|
0.01
|
|
|
Unusual
litigation
|
(0.06)
|
|
|
Israel API
business
|
(0.08)
|
|
|
Acquisition charges
and contingent consideration adjustments
|
(0.10)
|
|
|
Gain on
divestitures
|
(0.16)
|
|
|
Tax effect of
non-GAAP adjustments(2)
|
(0.28)
|
|
|
Adjusted
|
$4.45 -
$4.70
|
|
|
|
|
|
(1)
|
Held-for-sale
business includes the India API business.
|
|
|
(2)
|
Includes tax effect
of pretax non-GAAP adjustments calculated based upon the specific
rate of the applicable jurisdiction of the pretax item and certain
adjustments for discrete tax items in the first six months of the
year.
|
|
TABLE
V
|
|
PERRIGO COMPANY
PLC
|
|
RECONCILIATION OF
NON-GAAP MEASURES
|
|
(in
millions)
|
|
(unaudited)
|
|
|
|
|
Consolidated
adjusted net sales excluding Belgium distribution net sales,
Entocort® net sales, and Fx
|
|
|
Q2 2017 consolidated
reported net sales
|
$
|
1,237.9
|
|
|
|
|
|
Q2 2016 consolidated
adjusted net sales
|
$
|
1,297.0
|
|
|
Less: Fx
|
(16.0)
|
|
|
Less: Belgium
distribution net sales
|
(38.6)
|
|
|
Less:
Entocort® net sales
|
(26.4)
|
|
|
Q2 2016 consolidated
adjusted net sales excluding Belgium distribution net sales,
Entocort® and Fx
|
$
|
1,216.0
|
|
|
|
|
|
Total
change
|
2
|
%
|
|
|
|
|
CHCI adjusted net
sales excluding Belgium distribution net sales and
Fx
|
|
|
Q2 2017 CHCI reported
net sales
|
$
|
376.5
|
|
|
|
|
|
Q2 2016 CHCI reported
net sales
|
$
|
415.9
|
|
|
Less: Fx
|
(16.3)
|
|
|
Less: Belgium
Distribution net sales
|
(38.6)
|
|
|
Q2 2016 CHCI net
sales excluding Belgium distribution net sales and Fx
|
$
|
361.0
|
|
|
|
|
|
Total
change
|
4
|
%
|
|
TABLE V
(CONTINUED)
|
|
PERRIGO COMPANY
PLC
|
|
RECONCILIATION OF
NON-GAAP MEASURES
|
|
(in
millions)
|
|
(unaudited)
|
|
|
|
Three Months
Ended
|
|
|
July 1,
2017
|
July 2,
2016
|
|
RX reported net
sales
|
$
|
240.4
|
|
$
|
276.9
|
|
|
Less:
Entocort® sales
|
(4.0)
|
|
(30.4)
|
|
|
RX net sales
excluding Entocort®
|
$
|
236.4
|
|
$
|
246.5
|
|
|
|
|
|
|
RX adjusted operating
income
|
$
|
111.8
|
|
$
|
118.5
|
|
|
Entocort®:
|
|
|
|
Reported
Entocort® operating income
|
$
|
2.7
|
|
$
|
28.6
|
|
|
Add back:
amortization expense
|
0.5
|
|
0.5
|
|
|
Adjusted operating
income attributable to Entocort®
|
3.2
|
|
29.1
|
|
|
RX adjusted operating
income less contribution from Entocort®
|
$
|
108.6
|
|
$
|
89.4
|
|
|
RX operating margin
excluding Entocort®
|
45.9
|
%
|
36.3
|
%
|
|
|
|
|
|
RX operating income
growth excluding Entocort®
|
$
|
19.2
|
|
|
|
RX operating income
percent growth excluding Entocort®
|
21
|
%
|
|
|
|
|
|
|
|
Six Months
Ended
|
|
|
|
July 1,
2017
|
|
|
|
Consolidated
|
|
|
Operating cash
flow
|
$
|
285.3
|
|
|
|
Less: Tax
payment
|
74.2
|
|
|
|
Less: Restructuring
payments
|
30.7
|
|
|
|
|
$
|
390.2
|
|
|
|
Adjusted net
income
|
$
|
175.2
|
|
|
|
Cash conversion
ratio
|
120
|
%
|
|
TABLE
VI
|
PERRIGO COMPANY
PLC
|
RECONCILIATION OF
NON-GAAP MEASURES
|
SELECTED
CONSOLIDATED AND SEGMENT INFORMATION
|
(in millions, except
per share amounts)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CHCA adjusted net
sales growth over the past twelve months
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Net
sales
|
|
Three months
ended
|
|
Net
sales
|
|
Total
change
|
October 1,
2016*
|
|
$
|
590.2
|
|
|
September 26,
2015*
|
|
$
|
567.4
|
|
|
4%
|
December 31,
2016
|
|
626.8
|
|
|
December 31,
2015*
|
|
598.9
|
|
|
5%
|
April 1,
2017
|
|
582.8
|
|
|
April 2,
2016*
|
|
592.0
|
|
|
(2)%
|
July 1,
2017
|
|
604.9
|
|
|
July 2,
2016*
|
|
587.8
|
|
|
3%
|
|
|
$
|
2,404.7
|
|
|
|
|
$
|
2,346.1
|
|
|
3%
|
|
|
|
|
|
|
|
|
|
*Net sales are
adjusted to exclude sales attributable to held-for-sale businesses.
See Table II for non-GAAP reconciliations.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE VI
(CONTINUED)
|
PERRIGO COMPANY
PLC
|
RECONCILIATION OF
NON-GAAP MEASURES
|
SELECTED
CONSOLIDATED AND SEGMENT INFORMATION
|
(in millions, except
per share amounts)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
July 1,
2017
|
|
July 2,
2016
|
|
Total
Change
|
|
|
Consolidated
adjusted EPS
|
|
$
|
1.22
|
|
|
$
|
1.29
|
|
|
(5)%
|
|
|
Consolidated
adjusted net income
|
|
175.2
|
|
|
185.2
|
|
|
(5)%
|
|
|
Consolidated
adjusted diluted shares
|
|
143.6
|
|
|
143.6
|
|
|
—%
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
income
|
|
|
|
|
|
|
|
|
CHCA
|
|
$
|
127.0
|
|
|
$
|
138.8
|
|
|
(9)%
|
|
|
CHCI
|
|
54.9
|
|
|
56.6
|
|
|
(3)%
|
|
|
RX
|
|
111.8
|
|
|
118.5
|
|
|
(6)%
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
margin
|
|
|
|
|
|
|
|
|
CHCA
|
|
21.0
|
%
|
|
23.6
|
%
|
|
(260) bps
|
|
|
CHCI
|
|
14.6
|
%
|
|
13.6
|
%
|
|
100 bps
|
|
|
RX
|
|
46.5
|
%
|
|
42.8
|
%
|
|
370 bps
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted gross
profit
|
|
|
|
|
|
|
|
|
CHCA
|
|
$
|
215.9
|
|
|
$
|
226.3
|
|
|
(5)%
|
|
|
CHCI
|
|
194.8
|
|
|
205.4
|
|
|
(5)%
|
|
|
RX
|
|
141.4
|
|
|
157.4
|
|
|
(10)%
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted gross
margin
|
|
|
|
|
|
|
|
|
CHCA
|
|
35.7
|
%
|
|
38.5
|
%
|
|
(280) bps
|
|
|
CHCI
|
|
51.7
|
%
|
|
49.4
|
%
|
|
230 bps
|
|
|
RX
|
|
58.8
|
%
|
|
56.8
|
%
|
|
200 bps
|
|
|
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SOURCE Perrigo Company plc