Jan 29, 2019 SOURCE: PR NewsWire
Allergan Reports Fourth Quarter and Full-Year 2018 Financial Results
DUBLIN, Jan. 29, 2019 /PRNewswire/ -- Allergan plc (NYSE: AGN) today reported its full-year and fourth quarter 2018 financial results including full-year 2018 GAAP net revenues of $15.79 billion, a 1.0 percent decrease from 2017. Fourth quarter 2018 GAAP net revenues were $4.08 billion, a 5.7 percent decrease from the prior year quarter.
FOURTH QUARTER AND FULL-YEAR 2018 FINANCIAL RESULTS
(unaudited; $ in millions, except per share amounts) Q4 '18 Q4 '17 Q4 '18 v Q4 '17 Year Ended Year Ended
December 31, December 31,
2018 2017 2018 v 2017
---
Total Net Revenues $
4,079.7 $
4,326.1 (5.7) $
15,787.4 $
15,940.7 (1.0)
% %
---
Operating (Loss) $
(5,384.1) $
(90.5)
n.m. $
(6,247.6) $
(5,921.2) (5.5)
%
---
Diluted EPS - Continuing Operations $
(12.83) $
9.97
n.m. $
(15.26) $
(11.99) (27.3)
%
---
SG&A Expense $
1,193.6 $
1,266.8 (5.8) $
4,521.8 $
5,016.7 (9.9)
% %
---
R&D Expense $
678.1 $
408.2 66.1 $
2,266.2 $
2,100.1 7.9
% %
---
Continuing Operations Tax Rate 23.2 956.1
n.m. 25.8 64.2 38.4
% % % % %
---
Non-GAAP Net Revenues $
4,079.7 $
4,326.1 (5.7) $
15,762.4 $
15,940.7 (1.1)
% %
---
Non-GAAP Operating Income $
1,917.8 $
2,174.3 (11.8) $
7,555.8 $
7,647.5 (1.2)
% %
---
Non-GAAP Performance Net Income Per Share $
4.29 $
4.86 (11.7) $
16.69 $
16.35 2.1
% %
---
Non-GAAP Adjusted EBITDA $
1,990.5 $
2,284.5 (12.9) $
7,954.1 $
8,097.6 (1.8)
% %
---
Non-GAAP SG&A Expense $
1,140.4 $
1,132.8 0.7 $
4,354.9 $
4,554.8 (4.4)
% %
---
Non-GAAP R&D Expense $
436.1 $
405.7 7.5 $
1,574.5 $
1,598.8 (1.5)
% %
---
Non-GAAP Continuing Operations Tax Rate 14.3 11.4 2.9 14.2 12.6 1.6
% % % % % %
---
Executive Commentary
"Allergan posted another quarter of strong results to close out 2018, underscoring our focus on execution, financial discipline and the strength of our core business which grew 8.3 percent. Our anchor brands BOTOX(®) Cosmetic, BOTOX(®) Therapeutic, VRAYLAR(®), JUVÉDERM(®), Lo LOESTRIN(®), CoolSculpting(®) and LINZESS(®) added nearly $1 billion in new revenue to our core business in 2018," said Brent Saunders, Chairman and CEO of Allergan. "I'm also proud of the significant advances we have made in our R&D pipeline with positive clinical results reported from six late-stage development programs. We look to build on that progress in 2019."
"Taken together, these accomplishments and our talented colleagues give me confidence in our ability to continue producing solid results in 2019 and beyond, while also delivering innovation that will have an enduring impact on patients, customers and shareholders."
Full-Year 2018 Performance
GAAP operating loss in 2018 was $6.25 billion compared with $5.92 billion in 2017. Non-GAAP operating income, which excludes the impact of impairments, amortization and other items, was $7.56 billion in 2018 compared to $7.65 billion in 2017, impacted by lower revenues as operating margin remained stable. GAAP cash flow from operations for the full year of 2018 totaled $5.64 billion.
Fourth Quarter 2018 Performance
GAAP operating loss in the fourth quarter 2018 was $5.38 billion, including the impact of impairments. Non-GAAP operating income in the fourth quarter of 2018 was $1.92 billion, a decrease of 11.8 percent versus the prior year quarter, impacted by lower operating margin and revenues due to the impact of divestitures, products that lost exclusivity and a decline in RESTASIS(®). GAAP cash flow from operations for the fourth quarter of 2018 totaled $1.50 billion.
Operating Expenses
Total GAAP Selling, General and Administrative (SG&A) Expense was $1.19 billion for the fourth quarter 2018, a decrease of 5.8 percent from the prior year quarter. Total non-GAAP SG&A expense was $1.14 billion for the fourth quarter 2018 compared with $1.13 billion in the prior year period, including an increase in selling and marketing spending in Medical Aesthetics offset by the impact of previous restructurings. GAAP R&D investment for the fourth quarter of 2018 was $678.1 million, compared to $408.2 million in the fourth quarter of 2017. Non-GAAP R&D investment for the fourth quarter 2018 was $436.1 million compared to $405.7 million in the prior year quarter, due to increased direct project spend to support pipeline advancement.
Amortization, Tax and Capitalization
Amortization expense for the fourth quarter 2018 was $1.57 billion, compared to $1.92 billion in the fourth quarter of 2017. The Company's GAAP tax rate was 23.2 percent in the fourth quarter 2018. The Company's non-GAAP adjusted tax rate was 14.3 percent in the fourth quarter 2018. As of December 31, 2018, Allergan had cash and marketable securities of $1.91 billion and outstanding indebtedness of $23.8 billion.
Impairments
In the fourth quarter of 2018, Allergan recorded total pre-tax impairment charges of $5.4 billion. This amount reflects $1.9 billion of other intangible asset impairments, including $1.6 billion for KYBELLA®/BELKYRA® as sales forecasts have declined. The Company's intended sale of Anti-Infectives and its increased cost of capital based on market dynamics as well as other commercial factors prompted a review of its General Medicine Reporting Unit goodwill. As a result, the Company wrote off $3.5 billion of total goodwill, including $622 million allocated to Anti-Infectives.
FOURTH QUARTER 2018 BUSINESS SEGMENT RESULTS
U.S. Specialized Therapeutics
U.S. Specialized Therapeutics net revenues were $1.81 billion in the fourth quarter of 2018, a decrease of 3.9 percent versus the prior year quarter. Volume demand growth in BOTOX(®) Therapeutic and Facial Aesthetics, including BOTOX(®) Cosmetic and JUVÉDERM(®) Collection, was offset in part by a decline in RESTASIS(®) due to lower demand and net pricing, as well as the divestiture of the Company's Medical Dermatology business on September 20, 2018. Segment gross margin for the fourth quarter of 2018 was 92.3 percent. Segment contribution for the fourth quarter 2018 was $1.23 billion.
Medical Aesthetics
-- Facial Aesthetics
-- BOTOX(®) Cosmetic net revenues in the fourth quarter of 2018 were
$258.1 million, an increase of 13.0 percent from the prior year
quarter.
-- JUVÉDERM(®) Collection (defined as JUVÉDERM(®), VOLUMA(®) and
other fillers) net revenues in the fourth quarter of 2018 were
$158.4 million, an increase of 13.5 percent versus the prior year
quarter.
-- Regenerative Medicine
-- ALLODERM(®) net revenues in the fourth quarter of 2018 were $94.9
million, a decrease of 3.1 percent versus the prior year quarter.
-- Body Contouring
-- CoolSculpting(®) net revenues (including both CoolSculpting(®)
Systems/Applicators and Consumables) in the fourth quarter of 2018
were $81.3 million, a decrease of 13.9 percent versus the prior year
quarter.
Neurosciences & Urology
-- BOTOX(®) Therapeutic net revenues in the fourth quarter of 2018 were
$433.3 million, an increase of 12.8 percent versus the prior year
quarter.
Eye Care
-- RESTASIS(®) net revenues in the fourth quarter of 2018 were $325.0
million, a decrease of 18.8 percent versus the prior year quarter.
-- ALPHAGAN(®)/COMBIGAN(®) net revenues in the fourth quarter of 2018
were $97.7 million, a decrease of 4.0 percent versus the prior year
quarter.
-- OZURDEX(®) net revenues in the fourth quarter of 2018 were $29.3
million, an increase of 11.0 percent versus the prior year quarter.
U.S. General Medicine
U.S. General Medicine net revenues in the fourth quarter of 2018 were $1.40 billion, a decrease of 8.4 percent versus the prior year quarter, impacted by lower revenues from NAMENDA XR(®) and ESTRACE(®) due to generic competition, offset by growth from VRAYLAR(®) and Lo LOESTRIN(®). Segment gross margin for the fourth quarter of 2018 was 86.0 percent. Segment contribution for the fourth quarter 2018 was $946.6 million.
Central Nervous System
-- VRAYLAR(®) net revenues were $150.5 million in the fourth quarter of
2018, an increase of 71.6 percent from the prior year quarter.
-- VIIBRYD(®)/FETZIMA(®) net revenues in the fourth quarter of 2018 were
$95.5 million, an increase of 7.3 percent from the prior year quarter.
-- NAMENDA(®) net revenues in the fourth quarter of 2018 were $10.7
million compared to $97.8 million in the prior year quarter, impacted by
loss of patent exclusivity for NAMENDA XR(®) in February 2018.
Gastrointestinal, Women's Health & Diversified Brands
-- LINZESS(®) net revenues in the fourth quarter of 2018 were $205.2
million, an increase of 5.3 percent versus the prior year quarter.
-- Lo LOESTRIN(®) net revenues in the fourth quarter of 2018 were $143.8
million, an increase of 13.7 percent versus the prior year quarter.
-- BYSTOLIC(®)/BYVALSON(®) net revenues in the fourth quarter of 2018
were $151.7 million, a decrease of 3.7 percent from the prior year
quarter.
International
International net revenues in the fourth quarter of 2018 were $870.2 million, an increase of 1.0 percent versus the prior year quarter excluding foreign exchange impact, driven by growth in Facial Aesthetics and BOTOX(®) Therapeutic. International net revenues were negatively impacted by a recall of textured breast implants in certain international markets as well as reduced OZURDEX(®) sales following a third quarter product recall in certain markets. Segment gross margin for the fourth quarter of 2018 was 83.2 percent, also impacted by the textured breast implant recall. Segment contribution was $452.0 million.
Facial Aesthetics
-- BOTOX(®) Cosmetic net revenues in the fourth quarter of 2018 were
$157.8 million, an increase of 9.2 percent versus the prior year quarter
excluding foreign exchange impact.
-- JUVÉDERM(®) Collection net revenues in the fourth quarter of 2018 were
$174.0 million, an increase of 20.4 percent versus the prior year
quarter excluding foreign exchange impact.
Eye Care
-- LUMIGAN(®)/GANFORT(®) net revenues in the fourth quarter of 2018 were
$96.9 million, an increase of 2.2 percent versus the prior year quarter
excluding foreign exchange impact.
-- OZURDEX(®) net revenues in the fourth quarter of 2018 were $29.6
million compared to $60.9 million in the prior year quarter.
Botox(®) Therapeutic
-- BOTOX(®) Therapeutic net revenues in the fourth quarter of 2018 were
$96.7 million, an increase of 6.6 percent versus the prior year quarter
excluding foreign exchange impact.
NEW SHARE REPURCHASE PROGRAM
Allergan's Board of Directors has authorized a new $2.0 billion share repurchase program as part of the Company's capital allocation strategy. Allergan expects to deploy the program over the next 12 months.
Allergan reaffirmed its commitment to maintaining investment grade credit ratings and achieving a net debt to adjusted EBITDA ratio of less than 2.5X by the end of 2020.
These actions reflect the Company's conviction in its strategy and strong future cash flow position, allowing for periodic return of cash to shareholders through dividends and share buybacks while maintaining investment grade ratings and continuing its strategy to pay down debt.
PIPELINE UPDATE
Allergan R&D continues to advance its pipeline. Key 2018 late stage clinical achievements and anticipated milestones include:
-- Cariprazine: Allergan anticipates a regulatory decision from the U.S.
Food and Drug Administration (FDA) in the first half of 2019 for the
Company's supplemental New Drug Application (sNDA) for VRAYLAR(®)
(cariprazine). The FDA accepted for review Allergan's sNDA seeking to
expand the indication to include the treatment of depressive episodes
associated with bipolar I disorder (bipolar depression) in adults. In
2018, Allergan reported positive Phase 3 results in the third of three
pivotal trials of cariprazine in bipolar depression.
-- Ubrogepant: Allergan anticipates filing a New Drug Application (NDA)
with the FDA by the first quarter of 2019 for ubrogepant for the acute
treatment of migraine. In 2018, Allergan reported positive results from
two Phase 3 clinical trials studying the safety and efficacy of
ubrogepant, an oral CGRP receptor antagonist, as well as two positive
safety studies, including a long-term safety study of ubrogepant for
acute migraine.
-- Atogepant: Allergan announced positive results from a Phase 2b/3
clinical trial evaluating the efficacy, safety, and tolerability of
atogepant, an oral CGRP receptor antagonist in development for migraine
prevention. A Phase 3 study has been initiated.
-- Bimatoprost SR: Allergan reported positive topline results from two
Phase 3 clinical trials of Bimatoprost SR, a first-in-class
sustained-release, biodegradable implant for the reduction of
intraocular pressure in patients with open-angle glaucoma or ocular
hypertension. Allergan anticipates submitting an NDA to the FDA in the
second half of 2019.
-- Abicipar: Allergan and Molecular Partners announced two positive Phase 3
clinical trials on Abicipar for the treatment of neovascular age-related
macular degeneration. The Biologics License Application (BLA) submission
for Abicipar is planned for the first half of 2019. Allergan anticipates
results from the MAPLE trial using its further optimized formulation in
the first half of 2019.
-- Brimonidine DDS: Allergan reported positive results in Phase 2b clinical
trials for Brimonidine DDS for geographic atrophy secondary to
age-related macular degeneration. Allergan plans to initiate Phase 3
clinical trials in the second half of 2019.
FIRST QUARTER AND FULL YEAR 2019 GUIDANCE
Twelve Months
Ending December
31, 2019
GAAP NON-GAAP
---
Total Net Revenues
$15.000 - $15.300 billion
$15.000 - $15.300 billion
--- ---
Gross Margin (as a % of
revenues) 85.0% - 85.5% 85.0% - 85.5%
--- ---
SG&A Expense
$4.1 - $4.3 billion
$4.1 - $4.3 billion
--- ---
R&D Expense
$1.8 - $1.9 billion
$1.6 - $1.7 billion
--- ---
Net Interest Expense/Other
Income (Expense) ~ $775.0 million ~ $800.0 million
--- ---
Tax Rate 24.5% - 25.0% 13.0% - 13.5%
--- ---
Net Income Per Share(1)
>=$1.14
>=$16.36
--- ---
Average 2018 Share Count(2) ~ 332.0 million ~ 332.0 million
--- ---
Cash Flow from Operations ~ $5.0 -$5.5 billion N/A
--- ---
Three Months Ending
March 31, 2019
GAAP NON-GAAP
---
Total Net Revenues
$3.400 - $3.550 billion
$3.400 - $3.550 billion
--- ---
Net Income /(Loss) Per
Share1,2
$(0.39) - $(0.20)
$3.40 - $3.60
--- ---
(1) GAAP represents EPS for ordinary shareholders. GAAP income per share
includes the impact of amortization of approximately $5.6 billion. Non-
GAAP represents performance net income per share.
(2) GAAP EPS shares do not include dilution of shares when earnings are a
net loss. As such, the dilution impact of outstanding equity awards is
not included in the forecasted shares.
FOURTH QUARTER AND FULL-YEAR 2018 CONFERENCE CALL AND WEBCAST DETAILS
Allergan will host a conference call and webcast today, Tuesday, January 29, at 8:30 a.m. Eastern Time to discuss its fourth quarter and full-year 2018 results. The dial-in number to access the call is U.S./Canada (877) 251-7980, International (706) 643-1573, and the conference ID is 8599848. A replay of the conference call will also be available beginning approximately two hours after the call's conclusion and will remain available through 11:30 p.m. Eastern Time on February 28, 2019. The replay may be accessed by dialing (855) 859-2056 or (404) 537-3406 and entering the conference ID 8599848.
To access the webcast, please visit Allergan's Investor Relations website at https://www.allergan.com/investors. A replay of the webcast will also be available on Allergan's Investor Relations website.
Allergan Contacts:
Investors:
Manisha Narasimhan, PhD (862) 261-7162
Christine Chiou (862) 261-7396
Media:
Amy Rose (862) 289-3072
About Allergan plc
Allergan plc (NYSE: AGN), headquartered in Dublin, Ireland, is a bold, global pharmaceutical leader. Allergan is focused on developing, manufacturing and commercializing branded pharmaceutical, device, biologic, surgical and regenerative medicine products for patients around the world.
Allergan markets a portfolio of leading brands and best-in-class products primarily focused on four key therapeutic areas including medical aesthetics, eye care, central nervous system and gastroenterology.
Allergan is an industry leader in Open Science, a model of research and development, which defines our approach to identifying and developing game-changing ideas and innovation for better patient care. With this approach, Allergan has built one of the broadest development pipelines in the pharmaceutical industry.
Allergan's success is powered by our global colleagues' commitment to being Bold for Life. Together, we build bridges, power ideas, act fast and drive results for our customers and patients around the world by always doing what is right.
With commercial operations in approximately 100 countries, Allergan is committed to working with physicians, healthcare providers and patients to deliver innovative and meaningful treatments that help people around the world live longer, healthier lives every day.
For more information, visit Allergan's website at www.Allergan.com.
Forward-Looking Statement
Statements contained in this press release that refer to future events or other non-historical facts are forward-looking statements that reflect Allergan's current perspective on existing trends and information as of the date of this release. Actual results may differ materially from Allergan's current expectations depending upon a number of factors affecting Allergan's business. These factors include, among others, the difficulty of predicting the timing or outcome of FDA approvals or actions, if any; the impact of competitive products and pricing; market acceptance of and continued demand for Allergan's products; the impact of uncertainty around timing of generic entry related to key products, including RESTASIS(®), on our financial results; risks associated with divestitures, acquisitions, mergers and joint ventures; risks related to impairments; uncertainty associated with financial projections, projected debt reduction, projected cost reductions, projected synergies, restructurings, increased costs, and adverse tax consequences; difficulties or delays in manufacturing; and other risks and uncertainties detailed in Allergan's periodic public filings with the Securities and Exchange Commission, including but not limited to Allergan's Annual Report on Form 10-K for the year ended December 31, 2017 and Allergan's Quarterly Report on Form 10-Q for the period ended September 30, 2018. Except as expressly required by law, Allergan disclaims any intent or obligation to update these forward-looking statements.
The following presents Allergan plc's statement of operations for the three and twelve months ended December 31, 2018 and 2017:
Table 1
ALLERGAN PLC
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited; in millions, except per share amounts)
Three Months Ended Year Ended
December 31 December 31
2018 2017 2018 2017
Net revenues $
4,079.7 $
4,326.1 $
15,787.4 $
15,940.7
Operating expenses:
Cost of sales (excludes amortization and impairment of 590.0 580.9 2,191.4 2,168.0
acquired intangibles including product rights)
Research and development 678.1 408.2 2,266.2 2,100.1
Selling, general and administrative 1,193.6 1,266.8 4,521.8 5,016.7
Amortization 1,569.1 1,922.2 6,552.3 7,197.1
In-process research and development impairments 6.6 207.0 804.6 1,452.3
Goodwill and other impairments and asset sales, net 5,426.4 31.5 5,698.7 3,927.7
Total operating expenses 9,463.8 4,416.6 22,035.0 21,861.9
Operating (loss) (5,384.1) (90.5) (6,247.6) (5,921.2)
Non-operating income (expense):
Interest income 11.6 14.7 45.2 67.7
Interest (expense) (210.2) (263.3) (911.2) (1,095.6)
Other income (expense), net (9.9) (70.7) 256.7 (3,437.3)
Total other income (expense), net (208.5) (319.3) (609.3) (4,465.2)
(Loss) before income taxes and noncontrolling interest (5,592.6) (409.8) (6,856.9) (10,386.4)
(Benefit) for income taxes (1,296.7) (3,918.3) (1,770.7) (6,670.4)
(Loss) from continuing operations, net of tax (4,295.9) 3,508.5 (5,086.2) (3,716.0)
(Loss) from discontinued operations, net of tax (385.3) (402.9)
Net (loss) / income (4,295.9) 3,123.2 (5,086.2) (4,118.9)
(Income) attributable to noncontrolling interest (4.0) (1.9) (10.2) (6.6)
Net (loss) /income attributable to shareholders (4,299.9) 3,121.3 (5,096.4) (4,125.5)
Dividends on preferred shares 69.6 46.4 278.4
Net (loss) / income attributable to ordinary shareholders $
(4,299.9) $
3,051.7 $
(5,142.8) $
(4,403.9)
(Loss) / income per share attributable to ordinary shareholders - basic:
Continuing operations $
(12.83) $
10.37 $
(15.26) $
(11.99)
Discontinued operations (1.16) (1.20)
Net (loss) / income per share - basic $
(12.83) $
9.21 $
(15.26) $
(13.19)
(Loss) /income per share attributable to ordinary shareholders - diluted:
Continuing operations $
(12.83) $
9.97 $
(15.26) $
(11.99)
Discontinued operations (1.09) (1.20)
Net (loss) /income per share - diluted $
(12.83) $
8.88 $
(15.26) $
(13.19)
Dividends per ordinary share $
0.72 $
0.70 $
2.88 $
2.80
Weighted average shares outstanding:
Basic 335.1 331.3 337.0 333.8
Diluted 335.1 351.6 337.0 333.8
The following table details Allergan plc's product revenue for significant promoted products globally, within the U.S., and international for the three and twelve months ended December 31, 2018 and 2017.
ALLERGAN PLC
NET REVENUES TOP GLOBAL PRODUCTS
(Unaudited; in millions)
Three Months Ended December 31, 2018
Three Months Ended December 31, 2017 Movement
--- --- ---
US Specialized US General International Corporate Total US Specialized US General International Corporate Total Total Change Total Change
Therapeutics Medicine Therapeutics Medicine Percentage
Botox(R) $
691.4
$ $
254.5
$ $
945.9 $
612.4
$ $
251.9
$ $
864.3 $
81.6 9.4
%
Restasis(R) 325.0 16.6 341.6 400.3 14.6 414.9 (73.3) (17.7)
%
Juvederm(R) Collection 158.4 174.0 332.4 139.5 154.7 294.2 38.2 13.0
%
Linzess(R)/Constella(R) 205.2 6.4 211.6 194.8 5.8 200.6 11.0 5.5
%
Lumigan(R)/Ganfort(R) 74.0 96.9 170.9 80.9 99.7 180.6 (9.7) (5.4)
%
Bystolic(R) /Byvalson(R) 151.7 0.4 152.1 157.5 0.6 158.1 (6.0) (3.8)
%
Vraylar(R) 150.5 150.5 87.7 87.7 62.8 71.6
%
Alphagan(R)/Combigan(R) 97.7 46.7 144.4 101.8 46.7 148.5 (4.1) (2.8)
%
Lo Loestrin(R) 143.8 143.8 126.5 126.5 17.3 13.7
%
Eye Drops 47.9 71.7 119.6 47.3 73.8 121.1 (1.5) (1.2)
%
Viibryd(R)/Fetzima(R) 95.5 2.3 97.8 89.0 1.0 90.0 7.8 8.7
%
Alloderm(R) 94.9 2.5 97.4 97.9 2.5 100.4 (3.0) (3.0)
%
Breast Implants 68.2 10.5 78.7 69.0 40.1 109.1 (30.4) (27.9)
%
Coolsculpting(R) Consumables 54.5 23.4 77.9 51.9 15.3 67.2 10.7 15.9
%
Zenpep(R) 66.8 0.4 67.2 58.5 58.5 8.7 14.9
%
Ozurdex (R) 29.3 29.6 58.9 26.4 60.9 87.3 (28.4) (32.5)
%
Carafate (R) /Sulcrate (R) 54.1 0.7 54.8 59.2 0.8 60.0 (5.2) (8.7)
%
Armour Thyroid 53.4 53.4 51.3 51.3 2.1 4.1
%
Viberzi(R) 48.9 0.6 49.5 42.9 0.2 43.1 6.4 14.8
%
Coolsculpting(R) Systems & Add On Applicators 26.8 21.5 48.3 42.5 11.7 54.2 (5.9) (10.9)
%
Skin Care 40.4 3.6 44.0 40.6 4.4 45.0 (1.0) (2.2)
%
Canasa(R)/Salofalk(R) 38.8 4.5 43.3 47.0 5.0 52.0 (8.7) (16.7)
%
Asacol(R)/Delzicol(R) 27.9 10.7 38.6 42.8 13.4 56.2 (17.6) (31.3)
%
Saphris(R) 36.8 36.8 37.7 37.7 (0.9) (2.4)
%
Teflaro(R) 30.0 30.0 29.2 29.2 0.8 2.7
%
Avycaz(R) 24.6 24.6 18.5 18.5 6.1 33.0
%
Savella(R) 23.6 23.6 23.9 23.9 (0.3) (1.3)
%
Namzaric(R) 22.6 22.6 36.8 36.8 (14.2) (38.6)
%
Rapaflo(R) 18.9 1.8 20.7 28.2 1.8 30.0 (9.3) (31.0)
%
Dalvance(R) 17.3 1.0 18.3 13.0 1.2 14.2 4.1 28.9
%
Estrace(R) Cream 14.7 14.7 101.5 101.5 (86.8) (85.5)
%
Liletta(R) 14.6 14.6 14.5 14.5 0.1 0.7
%
Namenda(R) 10.7 10.7 97.8 97.8 (87.1) (89.1)
%
Kybella(R) /Belkyra(R) 7.2 1.0 8.2 12.1 1.7 13.8 (5.6) (40.6)
%
Minastrin(R) 24 2.9 2.9 5.3 5.3 (2.4) (45.3)
%
Aczone(R) 0.6 0.1 0.7 38.0 0.2 38.2 (37.5) (98.2)
%
Tazorac(R) 0.3 0.1 0.4 14.1 0.2 14.3 (13.9) (97.2)
%
Other Products Revenues 73.3 163.5 88.7 2.8 328.3 78.9 189.9 107.7 3.1 379.6 (51.3) (13.5)
%
Total Net Revenues $
1,808.8 $
1,397.9 $
870.2 $
2.8 4,079.7 $
1,881.8 $
1,525.3 $
915.9 $
3.1 4,326.1 $
(246.4) (5.7)
%
Year Ended December 31, 2018
Year Ended December 31, 2017 Movement
--- --- ---
US Specialized US General International Corporate Total US Specialized US General International Corporate Total Total Change Total Change
Therapeutics Medicine Therapeutics Medicine Percentage
Botox(R) $
2,545.8
$ $
1,031.6
$ $
3,577.4 $
2,254.4
$ $
914.5
$ $
3,168.9 $
408.5 12.9
%
Restasis(R) 1,197.0 64.5 1,261.5 1,412.3 61.3 1,473.6 (212.1) (14.4)
%
Juvederm(R) Collection 548.2 614.8 1,163.0 501.1 540.7 1,041.8 121.2 11.6
%
Linzess(R)/Constella(R) 761.1 24.1 785.2 701.1 21.9 723.0 62.2 8.6
%
Lumigan(R)/Ganfort(R) 291.8 392.6 684.4 317.5 371.5 689.0 (4.6) (0.7)
%
Bystolic(R) /Byvalson(R) 583.8 2.0 585.8 612.2 2.2 614.4 (28.6) (4.7)
%
Alphagan(R)/Combigan(R) 375.4 176.0 551.4 377.3 175.1 552.4 (1.0) (0.2)
%
Lo Loestrin(R) 527.7 527.7 459.3 459.3 68.4 14.9
%
Vraylar(R) 487.1 487.1 287.8 287.8 199.3 69.2
%
Eye Drops 202.7 279.7 482.4 199.5 281.0 480.5 1.9 0.4
%
Alloderm(R) 407.3 8.0 415.3 321.2 7.5 328.7 86.6 26.3
%
Viibryd(R)/Fetzima(R) 342.4 7.2 349.6 333.2 3.1 336.3 13.3 4.0
%
Breast Implants 263.0 130.1 393.1 242.6 156.9 399.5 (6.4) (1.6)
%
Coolsculpting(R) Consumables 235.3 64.2 299.5 150.1 41.6 191.7 107.8 56.2
%
Ozurdex (R) 111.0 187.7 298.7 98.4 213.4 311.8 (13.1) (4.2)
%
Zenpep(R) 237.3 0.4 237.7 212.3 212.3 25.4 12.0
%
Carafate (R) /Sulcrate (R) 217.8 2.8 220.6 235.8 2.9 238.7 (18.1) (7.6)
%
Armour Thyroid 198.8 198.8 169.1 169.1 29.7 17.6
%
Canasa(R)/Salofalk(R) 169.2 17.6 186.8 162.7 18.3 181.0 5.8 3.2
%
Viberzi(R) 176.5 1.3 177.8 156.6 0.5 157.1 20.7 13.2
%
Asacol(R)/Delzicol(R) 130.8 45.7 176.5 195.5 50.2 245.7 (69.2) (28.2)
%
Coolsculpting(R) Systems & Add On 126.3 43.3 169.6 106.6 32.1 138.7 30.9 22.3
%
Applicators
Skin Care 138.8 15.2 154.0 153.2 12.0 165.2 (11.2) (6.8)
%
Saphris(R) 139.7 139.7 155.2 155.2 (15.5) (10.0)
%
Teflaro(R) 128.0 0.3 128.3 121.9 121.9 6.4 5.3
%
Namzaric(R) 115.8 115.8 130.8 130.8 (15.0) (11.5)
%
Avycaz(R) 94.6 94.6 61.2 61.2 33.4 54.6
%
Rapaflo(R) 81.9 6.4 88.3 108.1 7.3 115.4 (27.1) (23.5)
%
Savella(R) 85.0 85.0 98.2 98.2 (13.2) (13.4)
%
Dalvance(R) 56.1 2.3 58.4 53.9 2.4 56.3 2.1 3.7
%
Aczone(R) 55.1 0.4 55.5 166.3 0.5 166.8 (111.3) (66.7)
%
Liletta(R) 50.9 50.9 37.6 37.6 13.3 35.4
%
Namenda(R) 71.0 71.0 452.9 452.9 (381.9) (84.3)
%
Estrace(R) Cream 49.0 49.0 366.6 366.6 (317.6) (86.6)
%
Kybella(R) /Belkyra(R) 31.8 6.3 38.1 49.5 6.8 56.3 (18.2) (32.3)
%
Tazorac(R) 25.4 0.7 26.1 65.4 0.7 66.1 (40.0) (60.5)
%
Minastrin(R) 24 9.5 9.5 61.4 61.4 (51.9) (84.5)
%
Other Products Revenues 283.5 690.8 379.5 39.5 1,393.3 280.1 730.9 395.1 21.4 1,427.5 (34.2) (2.4)
%
Total Net Revenues $
6,920.3 $
5,322.9 $
3,504.7 $
39.5 15,787.4 $
6,803.6 $
5,796.2 $
3,319.5 $
21.4 15,940.7 $
(153.3) (1.0)
%
The following table presents Allergan plc's Condensed Consolidated Balance Sheets as of December 31, 2018 and December 31,
2017.
Table 3
ALLERGAN PLC
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited; in millions)
December December
31, 31,
2018 2017
Assets
Cash and cash equivalents $
880.4 $
1,817.2
Marketable securities 1,026.9 4,632.1
Accounts receivable, net 2,868.1 2,899.0
Inventories 846.9 904.5
Prepaid expenses and other
current assets 819.1 1,123.9
Assets held for sale 916.2 81.6
Property, plant and equipment,
net 1,787.0 1,785.4
Investments and other assets 3,034.3 587.0
Product rights and other
intangibles 43,695.4 54,648.3
Goodwill 45,913.3 49,862.9
Total assets $
101,787.6 $
118,341.9
Liabilities & Equity
Current liabilities $
4,859.6 $
5,616.3
Current and long-term debt and
capital leases 23,797.7 30,075.3
Deferred income taxes and other
liabilities 7,999.3 8,813.2
Total equity 65,131.0 73,837.1
Total liabilities and equity $
101,787.6 $
118,341.9
The following table presents Allergan plc's Consolidated Statements of Cash Flows for the three and twelve months ended December 31, 2018 and 2017.
Table 4
ALLERGAN PLC
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited; in millions)
Three
Months
Ended
December 31, Year Ended December 31,
2018 2017 2018 2017
Cash Flows From Operating Activities:
Net (loss) / income $
(4,295.9) $
3,123.2 $
(5,086.2) $
(4,118.9)
Reconciliation to net cash provided by operating activities:
Depreciation 46.6 48.3 196.3 171.5
Amortization 1,569.1 1,922.2 6,552.3 7,197.1
Provision for inventory reserve 21.5 24.9 96.4 102.2
Share-based compensation 54.6 72.5 239.8 293.3
Deferred income tax benefit 107.1 (4,577.8) (1,255.7) (7,783.1)
In-process research and development impairments 6.6 207.0 804.6 1,452.3
Goodwill and other impairments and asset sales, net 5,426.4 31.5 5,698.7 3,927.7
Net income impact of determining that the loss on investment of Teva securities is other-than-temporary 3,273.5
Charge to settle Teva related matters, net of tax 387.4 387.4
Loss on forward sale of Teva shares 62.9 62.9
Gain on sale of Teva shares, net (60.9)
Amortization of inventory step up 5.5 131.7
Gain on sale of businesses (182.6)
Non-cash extinguishment of debt 12.6 (7.5) 30.0 (15.7)
Cash charge related to extinguishment of debt (27.4) 35.1 (45.6) 205.6
Amortization of deferred financing costs 5.2 8.2 22.6 27.8
Contingent consideration adjustments,
including accretion 6.6 (81.6) (106.5) (133.2)
Other, net 28.5 (18.8) 29.0 (37.0)
Changes in assets and liabilities (net of effects
of acquisitions):
Decrease / (increase) in accounts receivable, net (54.0) (49.8) (37.0) (188.3)
Decrease / (increase) in inventories (9.5) (37.1) (145.7) (144.8)
Decrease / (increase) in prepaid expenses
and other current assets 9.7 (17.9) 4.3 27.9
Increase / (decrease) in accounts payable
and accrued expenses 197.7 452.2 151.6 95.9
Increase / (decrease) in income and other
taxes payable (1,607.1) 468.0 (1,191.6) 1,114.1
Increase / (decrease) in other assets and liabilities 0.3 25.1 (73.7) 29.1
Net cash provided by operating activities 1,498.6 2,083.5 5,640.1 6,079.0
Cash Flows From Investing Activities:
Additions to property, plant and equipment (88.4) (115.9) (253.5) (349.9)
Additions to product rights and other intangibles (10.0) (614.3)
Additions to investments (1,015.3) (1,350.0) (2,471.7) (9,783.8)
Proceeds from sale of investments and other assets 58.0 678.9 6,259.3 15,153.3
Payments to settle Teva related matters (466.0)
Proceeds from sales of property, plant and equipment 5.8 1.3 30.4 7.1
Acquisitions of businesses, net of cash acquired (5,290.4)
Net cash (used in) investing activities (1,039.9) (795.7) 3,098.5 (878.0)
Cash Flows From Financing Activities:
Proceeds from borrowings on long-term indebtedness, including credit facility 1,939.8 525.0 2,657.0 3,550.0
Proceeds from Forward Sale of Teva securities 465.5
Debt issuance and other financing costs (10.4) (3.1) (10.4) (20.6)
Payments on debt, including capital lease obligations (1,688.6) (834.4) (8,804.5) (6,413.6)
Cash charge related to extinguishment of debt (35.1) (205.6)
Proceeds from stock plans 4.2 16.2 102.4 183.4
Other financing, including contingent consideration (9.2) 3.6 (30.9) (511.6)
Payments to settle Teva related matters (234.0)
Repurchase of ordinary shares (751.9) (456.6) (2,775.4) (493.0)
Dividends (241.7) (301.2) (1,049.8) (1,218.2)
Net cash (used in) financing activities (757.8) (1,085.6) (9,680.1) (5,129.2)
Effect of currency exchange rate changes on cash (8.4) 2.3 4.7 21.4
and cash equivalents
Net increase / (decrease) in cash and cash equivalents (307.5) 204.5 (936.8) 93.2
Cash and cash equivalents at beginning of period 1,187.9 1,612.7 1,817.2 1,724.0
Cash and cash equivalents at end of period $
880.4 $
1,817.2 $
880.4 $
1,817.2
Non-GAAP performance net income per share is used by management as one of the primary metrics in evaluating the Company's performance. We believe that Non-GAAP performance net income per share enhances the comparability of our results between periods and provides additional information and transparency to investors on adjustments and other items that are not indicative of the Company's current and future operating performance. These are the financial measures used by our management team to evaluate our operating performance and make day to day operating decisions. We define non-GAAP adjustments to the reported GAAP measures as
GAAP results adjusted for the following net of tax: (i) amortization expenses, (ii) global supply chain and operational excellence initiatives or other restructurings of a similar nature, (iii) acquisition, divestiture, integration and licensing charges, (iv) accretion and fair market value adjustments on contingent liabilities, (v) impairment/asset sales and related costs, including the exclusion of discontinued operations, (vi) legal settlements and (vii) other unusual charges or expenses. Non-GAAP performance net income per share is not, and should not be viewed as, a substitute for reported GAAP continuing operations loss
per share. The Company has consistently excluded amortization and impairments of all intangible assets, including the product rights that generate a significant portion of our ongoing revenue. The Company's total accumulated amortization, including impairments of currently marketed products, related to our intangible assets as of December 31, 2018 and December 31, 2017 was $32.3 billion and $25.8 billion, respectively, and is expected to continue to be a material non-GAAP adjustment. The following table presents Allergan plc's GAAP to Non-GAAP adjustments for the three and twelve months ended December 31, 2018 and 2017:
Table 5
ALLERGAN PLC
GAAP TO NON-GAAP ADJUSTMENTS
(Unaudited; in millions)
Three Months Ended December 31, 2018
Research Selling Asset sales &
Impairments,
net
&
Net COGS & & General Amortization Interest Other Income
Revenue Development Marketing Administrative expense, income taxes
net (expense)
GAAP $
4,079.7 $
590.0 $
678.1 $
841.6 $
352.0 $
1,569.1 $
5,433.0 $
(198.6) $
(9.9) $
(1,296.7)
Purchase accounting impact on stock-based compensation for acquired awards (0.3) (0.6) (1.4) (0.4)
Severance due to integration of acquired entities (0.6) (2.5)
Non-acquisition related severance and restructuring (5.2) (0.1) (20.3) 0.2
Costs associated with disposed businesses 0.5 0.2 (1.3)
Integration charges of acquired businesses (0.1) 0.2 (10.4)
Milestones and upfront expenses for asset acquisitions
Bonti, Inc. (196.6)
Editas Medicine, Inc. (25.0)
Other (16.5)
Accretion and fair-value adjustments to contingent consideration (3.7) (2.9)
Non-cash amortization of debt premium recognized in purchase accounting (5.5)
Impairment of Kybella(R)intangible asset (1,643.8)
Impairment of TrueTear(R)intangible asset (187.6)
Impairment of Goodwill (2,841.1)
Impairment of Anti-Infectives held for sale, including allocated goodwill of $622 million (771.7)
Asset sales and impairments, other 25.5
Impairment of assets held for sale (14.2)
Gain on bond repurchases (13.9)
Litigation settlement related charges (16.4)
Other adjustments 0.1 0.1 (0.9) (1,569.1) (0.1) (0.1) (2.0)
Income taxes on pre-tax adjustments 658.8
Discrete income tax events 879.8
Non-GAAP Adjusted $
4,079.7 $
581.3 $
436.1 $
820.1 $
320.3
$
$ $
(204.2) $
(25.8) $
241.9
Three Months Ended December 31, 2017
Net COGS Research & Selling & General &
Development Marketing Administrative Amortization Asset sales & Interest Other Income
Impairments,
Revenue net expense, income taxes
net (expense)
GAAP $
4,326.1 $
580.9 $
408.2 $
877.7 $
389.1 $
1,922.2 $
238.5 $
(248.6) $
(70.7) $
(3,918.3)
Impact of selling through purchase accounting mark-up on acquired inventory (5.5)
Purchase accounting impact on stock-based compensation for acquired awards (1.3) (3.8) (6.7) (3.2)
Severance due to integration of acquired entities (0.8) (0.6)
Non-acquisition related severance and restructuring related to the December 31, 2017 restructuring program (7.7) (18.2) (56.5) (23.5) (17.7)
Non-acquisition related severance and restructuring (8.7) 0.0 0.4 0.6
Costs associated with disposed businesses (2.3) (0.1) (2.3)
Integration charges of acquired businesses (0.9) 0.2 (18.9)
Brand related milestones and upfront expenses for asset acquisitions
Other (5.3)
Accretion and fair-value adjustments to contingent consideration 55.9 25.7
Non-cash amortization of debt premium recognized in purchase accounting (6.4)
Impairment of IPR&D products acquired in the Allergan acquisition (207.0)
Asset sales and impairments, other (13.8)
Impact of debt refinancing 27.6
Loss on forward sale of Teva shares 62.9
Litigation settlement related charges (22.2)
Other adjustments 1.0 (1.4) (1,922.2) (11.4)
Income taxes on pre-tax adjustments 567.6
Discrete income tax events 3,570.2
Non-GAAP Adjusted $
4,326.1 $
611.3 $
405.7 $
815.2 $
317.6
$
$ $
(255.0) $
8.4 $
219.5
The non-GAAP income tax expense is determined based on our pre-tax income, adjusted for non-GAAP items on a jurisdiction by jurisdiction basis. The non-GAAP effective tax rate in the three months ended December 31, 2018 was impacted by U.S. income taxed at rates higher than the Irish statutory rate, partially offset by income earned in jurisdictions with tax rates lower than the Irish statutory rate.
The non-GAAP effective tax rate for the three months ended December 31, 2018 excludes a net discrete tax benefit of approximately $879.8 million related to the tax effects of integration and recognition of outside basis differences, changes in the applicable tax rates on certain temporary differences, uncertain tax positions, changes in valuation allowances and other individually insignificant items.
Year Ended December 31, 2018
Net Revenue COGS Research & Selling & General & Amortization Asset sales & Interest Other income
Development Marketing Administrative Impairments, expense, net (expense)
net Income taxes
GAAP $
15,787.4 $
2,191.4 $
2,266.2 $
3,250.6 $
1,271.2 $
6,552.3 $
6,503.3 $
(866.0) $
256.7 $
(1,770.7)
Purchase accounting impact on stock-based compensation for acquired awards (2.1) (4.8) (8.6) (2.9)
Severance due to integration of acquired entities (0.6) (0.7) (3.3)
Non-acquisition related severance and restructuring (33.7) (1.9) (38.8) (5.4) (13.6)
Costs associated with disposed businesses (1.0) 0.2 (4.1)
Integration charges of acquired businesses (0.3) (0.6) (1.0) (43.5)
Milestones and upfront expenses for asset acquisitions
Elastagen Pty Ltd (96.1)
AstraZeneca plc (90.0)
Merck & Co. (115.0)
Chase Pharmaceuticals Corporation (75.0)
Repros Therapeutics, Inc. (33.2)
Bonti, Inc. (196.6)
Editas Medicine, Inc. (40.0)
Other (33.0)
Accretion and fair-value adjustments to contingent consideration 111.7 (5.1)
Non-cash amortization of debt premium recognized in purchase accounting (21.2)
Impairment of Kybella(R)intangible asset (1,643.8)
Impairment of TrueTear(R)intangible asset (187.6)
Impairment of Goodwill (2,841.1)
Impairment of Anti-Infectives held for sale, including allocated goodwill of $622 million (771.7)
Impairment of IPR&D products acquired in the Allergan acquisition (236.0)
Impairment of IPR&D products acquired in the Vitae acquisition (40.0)
Impairment of assets held for sale (266.2)
Impairment of RORgt IPR&D product (522.0)
Asset sales and impairments, other 18.4
Gain on Teva securities (60.6)
Milestone component of ongoing intellectual property agreement (25.0)
Gain on sale of divested businesses (182.6)
Gain on bond repurchases (15.6)
Litigation settlement related charges (56.8)
Other adjustments 0.1 0.2 (2.0) (6,552.3) 0.3 (0.1) (5.7)
Income taxes on pre-tax adjustments 1,506.1
Discrete income tax events 1,213.8
Non-GAAP Adjusted $
15,762.4 $
2,266.1 $
1,574.5 $
3,201.7 $
1,153.2
$
$ $
(887.3) $
(7.8) $
949.2
Year Ended December 31, 2017
Net Revenue COGS Research & Selling & General & Amortization Asset sales & Interest Other income
Development Marketing Administrative Impairments, expense, net (expense)
net Income taxes
GAAP $
15,940.7 $
2,168.0 $
2,100.1 $
3,514.8 $
1,501.9 $
7,197.1 $
5,380.0 $
(1,027.9) $
(3,437.3) $
(6,670.4)
Impact of selling through purchase accounting mark-up on acquired inventory (131.7)
Expenditures incurred with the Pfizer transaction (2.0) (2.4) (5.6) (10.5)
Purchase accounting impact on stock-based compensation for acquired awards (4.6) (18.3) (33.1) (49.0)
Severance due to integration of acquired entities (0.5) (3.0) (19.5) (17.3)
Non-acquisition related severance and restructuring related to the December 31, 2017 announced restructuring
program (7.7) (18.2) (56.5) (23.5) (17.7)
Non-acquisition related severance and restructuring (53.8) (15.1) (24.3) (9.3)
Costs associated with disposed businesses (4.9) (0.3) (16.0)
Integration charges of acquired businesses (0.6) (3.2) (4.1) (95.0)
Brand related milestones and upfront expenses for asset acquisitions
Assembly Biosciences, Inc. (50.0)
Lysosomal Therapeutics, Inc. (145.0)
Editas Medicine Inc. (90.0)
Akarna Therapeutics, Ltd. (39.6)
Heptares Therapeutics Ltd. (15.0)
Lyndra, Inc. (15.0)
Other (37.2)
Accretion and fair-value adjustments to contingent consideration 183.2 (50.0)
Net income impact of determining that the loss on investment of Teva securities is other-than-temporary 3,273.5
Non-cash amortization of debt premium recognized in purchase accounting (33.2)
Termination of agreement for SER-120 (147.4)
Impairment of Restasis intangible assets and dry eye IPR&D projects acquired in the Allergan acquisition (3,394.0)
Impairment of Aczone intangible assets (646.0)
Impairment of IPR&D products acquired in the Allergan acquisition (774.0)
Decrease in realization of certain R&D projects acquired in the Uteron acquisition (91.3)
Decrease in realization of certain R&D projects acquired in the Warner Chilcott acquisition (278.0)
Asset sales and impairments, other (31.6)
Settlement of Naurex, Inc. agreement (20.0)
Loss on forward sale of Teva shares 62.9
Impact of debt refinancing (12.6) 189.1
Litigation settlement related charges (96.5)
Other adjustments (12.5) 0.7 (0.5) 11.7 (7,197.1) (5.4)
Income taxes on pre-tax adjustments 3,717.9
Discrete income tax events 3,790.9
Non-GAAP Adjusted $
15,940.7 $
2,132.9 $
1,598.8 $
3,370.9 $
1,183.9
$
$ $
(1,061.1) $
62.8 $
838.4
The non-GAAP income tax expense is determined based on our pre-tax income, adjusted for non-GAAP items on a jurisdiction by jurisdiction basis. The non-GAAP effective tax rate in the twelve months ended December 31, 2018 was impacted by U.S. income taxed at rates higher than the Irish statutory rate, partially offset by income earned in jurisdictions with tax rates lower than the Irish statutory rate.
The non-GAAP effective tax rate for the twelve months ended December 31, 2018 excludes a net discrete tax benefit of approximately $1,213.8 million related to the tax effects of integration and recognition of outside basis differences, changes in the applicable tax rates on certain temporary differences, uncertain tax positions, changes in valuation allowances and other individually insignificant items.
The following table presents a reconciliation of Allergan plc's reported net (loss) /income from continuing operations attributable to shareholders and diluted earnings per share to non-GAAP performance net income and non-GAAP performance net income per share for the three and twelve months ended December 31,
2018 and 2017:
Table 6
ALLERGAN PLC
RECONCILIATION TABLE
(Unaudited; in millions except per share amounts)
Three
Months
Ended
Ended Year
December 31, December 31,
2018 2017 2018 2017
GAAP to Non-GAAP Performance net income calculation
GAAP (loss) / income from continuing operations attributable to shareholders $
(4,299.9) $
3,506.6 $
(5,096.4) $
(3,722.6)
Adjusted for:
Amortization 1,569.1 1,922.2 6,552.3 7,197.1
Acquisition, divestiture and licensing (income) / charges 249.9 108.4 485.7 4,083.4
Accretion and fair-value adjustments to contingent consideration 6.6 (81.6) (106.6) (133.2)
Goodwill and other impairments and asset sales, net and related costs 5,433.0 238.5 6,503.3 5,380.0
Other (15.9) 16.2 (42.6) 210.1
Non-acquisition restructurings, including Global Supply Chain initiatives 25.4 113.6 79.8 208.4
Legal settlements 16.4 22.2 56.8 96.5
Income taxes on items above and other discrete income tax adjustments (1,538.6) (4,137.8) (2,719.9) (7,508.8)
Non-GAAP performance net income attributable to shareholders $
1,446.0 $
1,708.3 $
5,712.4 $
5,810.9
Diluted earnings per share
Diluted (loss) / income per share from continuing operations attributable to shareholders- GAAP $
(12.83) $
9.97 $
(15.12) $
(11.15)
Non-GAAP performance net income per share attributable to shareholders $
4.29 $
4.86 $
16.69 $
16.35
Basic weighted average ordinary shares outstanding 335.1 331.3 337.0 333.8
Effect of dilutive securities:
Dilutive shares 2.3 20.3 5.2 21.6
Diluted weighted average ordinary shares outstanding 337.4 351.6 342.2 355.4
We define adjusted EBITDA as an amount equal to consolidated net income /(loss) from continuing operations attributable to shareholders for such period adjusted for the following: (i) interest expense, (ii) interest income, (iii) (benefit) for income taxes, (iv) depreciation and amortization expenses, (v)
share-based compensation expense, (vi) asset impairment charges and losses /(gains) and expenses associated with the sale of assets, including the exclusion of discontinued operations, (vii) business restructuring charges associated with Allergan's global supply chain and operational excellence
initiatives or other restructurings of a similar nature, (viii) costs and charges associated with the acquisition and divestitures of businesses and assets including, but not limited to, milestone payments, integration charges, other charges associated with the revaluation of assets or liabilities and
charges associated with the revaluation of acquisition related contingent liabilities that are based in whole or in part on future estimated cash flows, (ix) litigation charges and settlements and (x) other unusual charges or expenses. We define non-GAAP operating income as adjusted EBITDA including
depreciation and certain share-based compensation charges and excluding dividend income, fair value accounting results included within other income (expense), net and other-than-temporary investment impairments included within other income (expense), net.
The following table presents a reconciliation of Allergan plc's reported net (loss) from continuing operations attributable to shareholders for the three and twelve months ended December 31, 2018 and 2017 to adjusted EBITDA and Non-GAAP Operating Income:
Table 7
ALLERGAN PLC
ADJUSTED EBITDA and NON-GAAP OPERATING INCOME, RECONCILIATION TABLE
(Unaudited; in millions)
Three
Months
Ended Year Ended
December 31, December 31,
2018 2017 2018 2017
GAAP (loss) / income from continuing operations attributable to shareholders $
(4,299.9) $
3,506.6 $
(5,096.4) $
(3,722.6)
Plus:
Interest expense 210.2 263.3 911.2 1,095.6
Interest income (11.6) (14.7) (45.2) (67.7)
(Benefit) for income taxes (1,296.7) (3,918.3) (1,770.7) (6,670.4)
Depreciation 46.6 48.3 196.3 171.5
Amortization 1,569.1 1,922.2 6,552.3 7,197.1
EBITDA $
(3,782.3) $
1,807.4 $
747.5 $
(1,996.5)
Adjusted for:
Acquisition, divestiture and licensing charges 252.7 95.7 480.3 4,007.5
Goodwill and other impairments and asset sales, net and related costs 5,433.0 238.5 6,503.3 5,380.0
Other (15.9) 16.2 (42.6) 210.1
Non-acquisition restructurings, including Global Supply Chain initiatives, excluding depreciation 25.4 113.6 75.6 208.4
Legal settlements 16.4 22.2 56.8 96.5
Accretion and fair-value adjustments to contingent consideration 6.6 (81.6) (106.6) (133.2)
Share-based compensation including cash settlements 54.6 72.5 239.8 324.8
Adjusted EBITDA $
1,990.5 $
2,284.5 $
7,954.1 $
8,097.6
Adjusted for:
Depreciation (46.6) (48.3) (192.1) (171.5)
Dividend income (8.5) (85.2)
Other income (expense) related to fair value accounting* 25.8 7.0 22.3
Share-based compensation not related to restructuring charges and purchase accounting impact on stock-based
compensation for acquired awards (51.9) (53.4) (213.2) (215.7)
Non-GAAP Operating Income $
1,917.8 $
2,174.3 $
7,555.8 $
7,647.5
* YTD 2018 amounts relate to mark to market adjustments on available for sale securities and non-service components of pension costs based on ASU 2016-01 and ASU 2017-07, respectively. Amounts in the twelve months ended December 31, 2017 represent an other-than-temporary impairment of securities.
The following table details Allergan plc's segment contribution reconciled to the non-GAAP contribution for the same financial statement line items for the three and twelve months ended December 31, 2018 and 2017. Included within our corporate function are shared costs, including above site and unallocated costs associated with running our global manufacturing facilities, corporate general and administrative expenses and corporate initiatives.
Table 8
ALLERGAN PLC
Segment Contribution to Non-GAAP Allergan plc Contribution
(Unaudited; $ in millions)
Three Months Ended December 31, 2018
Three Months Ended December 31, 2017
--- ---
US US US
General General
Specialized International Corporate Total Specialized US International Corporate Total
Medicine Medicine
Therapeutics Segment Segment Therapeutics Segment Segment
Segment Segment
Net revenues $
1,808.8 $
1,397.9 $
870.2 $
2.8 $
4,079.7 $
1,881.8 $
1,525.3 $
915.9 $
3.1 $
4,326.1
Operating expenses:
Cost of sales(1) 139.3 195.1 146.1 100.8 581.3 146.0 220.7 137.1 107.5 611.3
Selling and marketing 378.1 211.1 230.8 0.1 820.1 328.8 245.8 240.6 815.2
General and administrative 59.7 45.1 41.3 174.2 320.3 58.8 47.6 34.1 177.1 317.6
Segment contribution $
1,231.7 $
946.6 $
452.0 $
(272.3) $
2,358.0 $
1,348.2 $
1,011.2 $
504.1 $
(281.5) $
2,582.0
Segment margin 68.1 67.7 51.9 n.m. 57.8 71.6 66.3 55.0 n.m. 59.7
% % % % % % % %
Segment gross margin(2) 92.3 86.0 83.2 n.m. 85.8 92.2 85.5 85.0 n.m. 85.9
% % % % % % % %
---
(1) Excludes amortization and impairment of acquired intangibles including product rights.
(2) Defined as net revenues less segment related cost of sales as a percentage of net revenues.
Year Ended December 31, 2018
Year Ended December 31, 2017
--- ---
US US US
General General
Specialized International Corporate Total Specialized US International Corporate Total
Medicine Medicine
Therapeutics Segment Segment Therapeutics Segment Segment
Segment Segment
Net revenues $
6,920.3 $
5,322.9 $
3,504.7 $
14.5 $
15,762.4 $
6,803.6 $
5,796.2 $
3,319.5 $
21.4 $
15,940.7
Operating expenses:
Cost of sales(1) 565.2 799.1 537.1 364.7 2,266.1 495.4 843.9 478.7 314.9 2,132.9
Selling and marketing 1,348.3 924.6 928.7 0.1 3,201.7 1,369.5 1,084.1 913.8 3.5 3,370.9
General and administrative 205.3 156.4 141.7 649.8 1,153.2 208.2 177.3 120.6 677.8 1,183.9
Segment contribution $
4,801.5 $
3,442.8 $
1,897.2 $
(1,000.1) $
9,141.4 $
4,730.5 $
3,690.9 $
1,806.4 $
(974.8) $
9,253.0
Segment margin 69.4 64.7 54.1 n.m. 58.0 69.5 63.7 54.4 n.m. 58.0
% % % % % % % %
Segment gross margin(2) 91.8 85.0 84.7 n.m. 85.6 92.7 85.4 85.6 n.m. 86.6
% % % % % % % %
---
(1) Excludes amortization and impairment of acquired intangibles including product rights.
(2) Defined as net revenues less segment related cost of sales as a percentage of net revenues.
The following table details Allergan plc's product revenue for significant promoted products within the US Specialized Therapeutics segment for the three and twelve months ended December 31, 2018 and 2017.
Table 9
ALLERGAN PLC
US Specialized Therapeutics Product Revenue
(Unaudited; in millions)
Three
Months
Ended December 31, Change
2018 2017 Dollars %
Total Eye Care $
587.3 $
671.7 $
(84.4) (12.6)
%
Restasis(R) 325.0 400.3 (75.3) (18.8)
%
Alphagan(R)/Combigan(R) 97.7 101.8 (4.1) (4.0)
%
Lumigan(R)/Ganfort(R) 74.0 80.9 (6.9) (8.5)
%
Ozurdex(R) 29.3 26.4 2.9 11.0
%
Eye Drops 47.9 47.3 0.6 1.3
%
Other Eye Care 13.4 15.0 (1.6) (10.7)
%
Total Medical Aesthetics 738.3 712.9 25.4 3.6
%
Facial Aesthetics 423.7 380.0 43.7 11.5
%
Botox(R)Cosmetics 258.1 228.4 29.7 13.0
%
Juvederm(R)Collection 158.4 139.5 18.9 13.5
%
Kybella(R) 7.2 12.1 (4.9) (40.5)
%
Plastic Surgery 68.2 69.0 (0.8) (1.2)
%
Breast Implants 68.2 69.0 (0.8) (1.2)
%
Regenerative Medicine 124.7 128.9 (4.2) (3.3)
%
Alloderm(R) 94.9 97.9 (3.0) (3.1)
%
Other Regenerative Medicine 29.8 31.0 (1.2) (3.9)
%
Body Contouring 81.3 94.4 (13.1) (13.9)
%
Coolsculpting(R)Systems & Add On Applicators 26.8 42.5 (15.7) (36.9)
%
Coolsculpting(R)Consumables 54.5 51.9 2.6 5.0
%
Skin Care 40.4 40.6 (0.2) (0.5)
%
Total Medical Dermatology 4.5 68.7 (64.2) (93.4)
%
Aczone(R) 0.6 38.0 (37.4) (98.4)
%
Tazorac(R) 0.3 14.1 (13.8) (97.9)
%
Other Medical Dermatology 3.6 16.6 (13.0) (78.3)
%
Total Neuroscience & Urology 452.2 412.2 40.0 9.7
%
Botox(R)Therapeutics(3) 433.3 384.0 49.3 12.8
%
Rapaflo(R) 18.9 28.2 (9.3) (33.0)
%
Other Revenues 26.5 16.3 10.2 62.6
%
Net Revenues $
1,808.8 $
1,881.8 $
(73.0) (3.9)
%
Operating expenses:
Cost of sales(1) 139.3 146.0 (6.7) (4.6)
%
Selling and marketing 378.1 328.8 49.3 15.0
%
General and administrative 59.7 58.8 0.9 1.5
%
Segment contribution $
1,231.7 $
1,348.2 $
(116.5) (8.6)
%
Segment margin 68.1 71.6 (3.5)
% %
%
Segment gross margin(2) 92.3 92.2 0.1
% % %
---
(1) Excludes amortization and impairment of acquired intangibles including product rights.
(2) Defined as net revenues less segment related cost of sales as a percentage of net revenues.
(3) Botox Therapeutics includes Botox Hyperhidrosis, which was previously included within Medical Dermatology. The amount of Botox Hyperhidrosis for the three months ended December 31, 2017 was $16.8 million.
Year
Ended
December 31, Change
2018 2017 Dollars %
Total Eye Care $
2,235.7 $
2,460.2 $
(224.5) (9.1)
%
Restasis(R) 1,197.0 1,412.3 (215.3) (15.2)
%
Alphagan(R)/Combigan(R) 375.4 377.3 (1.9) (0.5)
%
Lumigan(R)/Ganfort(R) 291.8 317.5 (25.7) (8.1)
%
Ozurdex(R) 111.0 98.4 12.6 12.8
%
Eye Drops 202.7 199.5 3.2 1.6
%
Other Eye Care 57.8 55.2 2.6 4.7
%
Total Medical Aesthetics 2,774.6 2,449.2 325.4 13.3
%
Facial Aesthetics 1,487.3 1,362.8 124.5 9.1
%
Botox(R)Cosmetics 907.3 812.2 95.1 11.7
%
Juvederm(R)Collection 548.2 501.1 47.1 9.4
%
Kybella(R) 31.8 49.5 (17.7) (35.8)
%
Plastic Surgery 263.0 242.6 20.4 8.4
%
Breast Implants 263.0 242.6 20.4 8.4
%
Regenerative Medicine 523.9 433.9 90.0 20.7
%
Alloderm(R) 407.3 321.2 86.1 26.8
%
Other Regenerative Medicine 116.6 112.7 3.9 3.5
%
Body Contouring 361.6 256.7 104.9 40.9
%
Coolsculpting(R)Systems & Add On Applicators 126.3 106.6 19.7 18.5
%
Coolsculpting(R)Consumables 235.3 150.1 85.2 56.8
%
Skin Care 138.8 153.2 (14.4) (9.4)
%
Total Medical Dermatology 115.5 273.6 (158.1) (57.8)
%
Aczone(R) 55.1 166.3 (111.2) (66.9)
%
Tazorac(R) 25.4 65.4 (40.0) (61.2)
%
Other Medical Dermatology 35.0 41.9 (6.9) (16.5)
%
Total Neuroscience & Urology 1,720.4 1,550.3 170.1 11.0
%
Botox(R)Therapeutics (3) 1,638.5 1,442.2 196.3 13.6
%
Rapaflo(R) 81.9 108.1 (26.2) (24.2)
%
Other Revenues 74.1 70.3 3.8 5.4
%
Net Revenues $
6,920.3 $
6,803.6 $
116.7 1.7
%
Operating expenses:
Cost of sales(1) 565.2 495.4 69.8 14.1
%
Selling and marketing 1,348.3 1,369.5 (21.2) (1.5)
%
General and administrative 205.3 208.2 (2.9) (1.4)
%
Segment contribution $
4,801.5 $
4,730.5 $
71.0 1.5
%
Segment margin 69.4 69.5 (0.1)
% %
%
Segment gross margin(2) 91.8 92.7 (0.9)
% %
%
---
(1) Excludes amortization and impairment of acquired intangibles including product rights.
(2) Defined as net revenues less segment related cost of sales as a percentage of net revenues.
(3) Botox Therapeutics includes Botox Hyperhidrosis, which was previously included within Medical Dermatology. The amount of Botox Hyperhidrosis for the year ended December 31, 2017 was $67.2 million.
The following table details Allergan plc's product revenue for significant promoted products within the US General Medicine segment for the three and twelve months ended December 31, 2018 and 2017.
Table 10
ALLERGAN PLC
US General Medicine Product Revenue
(Unaudited; in millions)
Three
Months
Ended December 31, Change
2018 2017 Dollars %
Total Central Nervous System (CNS) $
316.1 $
349.0 $
(32.9) (9.4)
%
Vraylar(R) 150.5 87.7 62.8 71.6
%
Viibryd(R)/Fetzima(R) 95.5 89.0 6.5 7.3
%
Saphris(R) 36.8 37.7 (0.9) (2.4)
%
Namzaric(R) 22.6 36.8 (14.2) (38.6)
%
Namenda (R) 10.7 97.8 (87.1) (89.1)
%
Total Gastrointestinal (GI) 449.8 453.2 (3.4) (0.8)
%
Linzess(R) 205.2 194.8 10.4 5.3
%
Zenpep(R) 66.8 58.5 8.3 14.2
%
Carafate(R)/Sulcrate(R) 54.1 59.2 (5.1) (8.6)
%
Viberzi(R) 48.9 42.9 6.0 14.0
%
Canasa(R)/Salofalk(R) 38.8 47.0 (8.2) (17.4)
%
Asacol(R)/Delzicol(R) 27.9 42.8 (14.9) (34.8)
%
Other GI 8.1 8.0 0.1 1.3
%
Total Women's Health 213.9 285.8 (71.9) (25.2)
%
Lo Loestrin(R) 143.8 126.5 17.3 13.7
%
Estrace(R)Cream 14.7 101.5 (86.8) (85.5)
%
Liletta(R) 14.6 14.5 0.1 0.7
%
Minastrin(R)24 2.9 5.3 (2.4) (45.3)
%
Other Women's Health 37.9 38.0 (0.1) (0.3)
%
Total Anti-Infectives 78.8 66.6 12.2 18.3
%
Teflaro(R) 30.0 29.2 0.8 2.7
%
Avycaz(R) 24.6 18.5 6.1 33.0
%
Dalvance(R) 17.3 13.0 4.3 33.1
%
Other Anti-Infectives 6.9 5.9 1.0 16.9
%
Diversified Brands 300.1 319.4 (19.3) (6.0)
%
Bystolic(R)/Byvalson(R) 151.7 157.5 (5.8) (3.7)
%
Armour Thyroid 53.4 51.3 2.1 4.1
%
Savella(R) 23.6 23.9 (0.3) (1.3)
%
Other Diversified Brands 71.4 86.7 (15.3) (17.6)
%
Other Revenues 39.2 51.3 (12.1) (23.6)
%
Net revenues $
1,397.9 $
1,525.3 $
(127.4) (8.4)
%
Operating expenses:
Cost of sales(1) 195.1 220.7 (25.6) (11.6)
%
Selling and marketing 211.1 245.8 (34.7) (14.1)
%
General and administrative 45.1 47.6 (2.5) (5.3)
%
Segment contribution $
946.6 $
1,011.2 $
(64.6) (6.4)
%
Segment margin 67.7 66.3 1.4
% % %
Segment gross margin(2) 86.0 85.5 0.5
% % %
---
(1) Excludes amortization and impairment of acquired intangibles including product rights.
(2) Defined as net revenues less segment related cost of sales as a percentage of net revenues.
Year
Ended
December 31, Change
2018 2017 Dollars %
Total Central Nervous System (CNS) $
1,156.0 $
1,359.9 $
(203.9) (15.0)
%
Vraylar(R) 487.1 287.8 199.3 69.2
%
Viibryd(R)/Fetzima(R) 342.4 333.2 9.2 2.8
%
Saphris(R) 139.7 155.2 (15.5) (10.0)
%
Namzaric(R) 115.8 130.8 (15.0) (11.5)
%
Namenda(R) 71.0 452.9 (381.9) (84.3)
%
Total Gastrointestinal (GI) 1,723.7 1,695.0 28.7 1.7
%
Linzess(R) 761.1 701.1 60.0 8.6
%
Zenpep(R) 237.3 212.3 25.0 11.8
%
Carafate(R)/Sulcrate(R) 217.8 235.8 (18.0) (7.6)
%
Viberzi(R) 176.5 156.6 19.9 12.7
%
Canasa(R)/Salofalk(R) 169.2 162.7 6.5 4.0
%
Asacol(R)/Delzicol(R) 130.8 195.5 (64.7) (33.1)
%
Other GI 31.0 31.0 (0.0) (0.0)
%
Total Women's Health 786.8 1,044.2 (257.4) (24.7)
%
Lo Loestrin(R) 527.7 459.3 68.4 14.9
%
Estrace(R)Cream 49.0 366.6 (317.6) (86.6)
%
Liletta(R) 50.9 37.6 13.3 35.4
%
Minastrin(R)24 9.5 61.4 (51.9) (84.5)
%
Other Women's Health 149.7 119.3 30.4 25.5
%
Total Anti-Infectives 304.4 257.3 47.1 18.3
%
Teflaro(R) 128.0 121.9 6.1 5.0
%
Avycaz(R) 94.6 61.2 33.4 54.6
%
Dalvance(R) 56.1 53.9 2.2 4.1
%
Other Anti-Infectives 25.7 20.3 5.4 26.6
%
Diversified Brands 1,156.0 1,242.6 (86.6) (7.0)
%
Bystolic(R)/Byvalson(R) 583.8 612.2 (28.4) (4.6)
%
Armour Thyroid 198.8 169.1 29.7 17.6
%
Savella(R) 85.0 98.2 (13.2) (13.4)
%
Other Diversified Brands 288.4 363.1 (74.7) (20.6)
%
Other Revenues 196.0 197.2 (1.2) (0.6)
%
Net revenues $
5,322.9 $
5,796.2 $
(473.3) (8.2)
%
Operating expenses:
Cost of sales(1) 799.1 843.9 (44.8) (5.3)
%
Selling and marketing 924.6 1,084.1 (159.5) (14.7)
%
General and administrative 156.4 177.3 (20.9) (11.8)
%
Segment contribution $
3,442.8 $
3,690.9 $
(248.1) (6.7)
%
Segment margin 64.7 63.7 1.0
% % %
Segment gross margin(2) 85.0 85.4 (0.4)
% %
%
---
(1) Excludes amortization and impairment of acquired intangibles including product rights.
(2) Defined as net revenues less segment related cost of sales as a percentage of net revenues.
The following table details Allergan plc's product revenue for significant promoted products within the International segment for the three and twelve months ended December 31, 2018 and 2017.
Table 11
ALLERGAN PLC
International Product Revenue
(Unaudited; in millions)
Three
Months
Ended December 31, Change
2018 2017 Dollars %
Total Eye Care $
308.2 $
342.7 $
(34.5) (10.1)
%
Lumigan(R)/Ganfort(R) 96.9 99.7 (2.8) (2.8)
%
Alphagan(R)/Combigan(R) 46.7 46.7 0.0
%
Ozurdex(R) 29.6 60.9 (31.3) (51.4)
%
Restasis(R) 16.6 14.6 2.0 13.7
%
Eye Drops 71.7 73.8 (2.1) (2.8)
%
Other Eye Care 46.7 47.0 (0.3) (0.6)
%
Total Medical Aesthetics 396.0 389.3 6.7 1.7
%
Facial Aesthetics 332.8 311.4 21.4 6.9
%
Botox(R)Cosmetics 157.8 155.0 2.8 1.8
%
Juvederm(R)Collection 174.0 154.7 19.3 12.5
%
Belkyra(R)(Kybella(R)) 1.0 1.7 (0.7) (41.2)
%
Plastic Surgery 10.8 40.6 (29.8) (73.4)
%
Breast Implants 10.5 40.1 (29.6) (73.8)
%
Other Plastic Surgery 0.3 0.5 (0.2) (40.0)
%
Regenerative Medicine 3.9 5.8 (1.9) (32.8)
%
Alloderm(R) 2.5 2.5 0.0
%
Other Regenerative Medicine 1.4 3.3 (1.9) (57.6)
%
Body Contouring 44.9 27.0 17.9 66.3
%
Coolsculpting(R)Systems & Add On Applicators 21.5 11.7 9.8 83.8
%
Coolsculpting(R)Consumables 23.4 15.3 8.1 52.9
%
Skin Care 3.6 4.5 (0.9) (20.0)
%
Botox
(R) 150.1 160.6 (10.5) (6.5)
Therapeutics and Other
%
Botox(R)Therapeutics 96.7 96.9 (0.2) (0.2)
%
Asacol(R)/Delzicol(R) 10.7 13.4 (2.7) (20.1)
%
Constella(R) 6.4 5.8 0.6 10.3
%
Other Products 36.3 44.5 (8.2) (18.4)
%
Other Revenues 15.9 23.3 (7.4) (31.8)
%
Net revenues $
870.2 $
915.9 $
(45.7) (5.0)
%
Operating expenses:
Cost of sales(1) 146.1 137.1 9.0 6.6
%
Selling and marketing 230.8 240.6 (9.8) (4.1)
%
General and administrative 41.3 34.1 7.2 21.1
%
Segment contribution $
452.0 $
504.1 $
(52.1) (10.3)
%
Segment margin 51.9 55.0 (3.1)
% %
%
Segment gross margin(2) 83.2 85.0 (1.8)
% %
%
---
(1) Excludes amortization and impairment of acquired intangibles including product rights.
(2) Defined as net revenues less segment related cost of sales as a percentage of net revenues.
Year
Ended
December 31, Change
2018 2017 Dollars %
Total Eye Care $
1,294.6 $
1,282.1 $
12.5 1.0
%
Lumigan(R)/Ganfort(R) 392.6 371.5 21.1 5.7
%
Alphagan(R)/Combigan(R) 176.0 175.1 0.9 0.5
%
Ozurdex(R) 187.7 213.4 (25.7) (12.0)
%
Restasis(R) 64.5 61.3 3.2 5.2
%
Eye Drops 279.7 281.0 (1.3) (0.5)
%
Other Eye Care 194.1 179.8 14.3 8.0
%
Total Medical Aesthetics 1,533.3 1,366.6 166.7 12.2
%
Facial Aesthetics 1,262.3 1,104.5 157.8 14.3
%
Botox(R)Cosmetics 641.2 557.0 84.2 15.1
%
Juvederm(R)Collection 614.8 540.7 74.1 13.7
%
Belkyra(R)(Kybella(R)) 6.3 6.8 (0.5) (7.4)
%
Plastic Surgery 131.5 158.6 (27.1) (17.1)
%
Breast Implants 130.1 156.9 (26.8) (17.1)
%
Other Plastic Surgery 1.4 1.7 (0.3) (17.6)
%
Regenerative Medicine 16.8 16.5 0.3 1.8
%
Alloderm(R) 8.0 7.5 0.5 6.7
%
Other Regenerative Medicine 8.8 9.0 (0.2) (2.2)
%
Body Contouring 107.5 73.7 33.8 45.9
%
Coolsculpting(R)Systems & Add On Applicators 43.3 32.1 11.2 34.9
%
Coolsculpting(R)Consumables 64.2 41.6 22.6 54.3
%
Skin Care 15.2 13.3 1.9 14.3
%
Botox
(R) 611.5 587.4 24.1 4.1
Therapeutics and Other
%
Botox(R)Therapeutics 390.4 357.5 32.9 9.2
%
Asacol(R)/Delzicol(R) 45.7 50.2 (4.5) (9.0)
%
Constella(R) 24.1 21.9 2.2 10.0
%
Other Products 151.3 157.8 (6.5) (4.1)
%
Other Revenues 65.3 83.4 (18.1) (21.7)
%
Net revenues $
3,504.7 $
3,319.5 $
185.2 5.6
%
Operating expenses:
Cost of sales(1) 537.1 478.7 58.4 12.2
%
Selling and marketing 928.7 913.8 14.9 1.6
%
General and administrative 141.7 120.6 21.1 17.5
%
Segment contribution 1,897.2 1,806.4 90.8 5.0
%
Segment margin 54.1 54.4 (0.3)
% %
%
Segment gross margin(2) 84.7 85.6 (0.9)
% %
%
---
(1) Excludes amortization and impairment of acquired intangibles including product rights.
(2) Defined as net revenues less segment related cost of sales as a percentage of net revenues.
The following table provides a reconciliation of anticipated GAAP loss / income from continuing operations to non-GAAP performance net income attributable to shareholders for the three months ending March 31, 2019 and twelve months ending December 31, 2019:
Table 12
Three months ending Twelve months
March 31, 2019
ending December
31, 2019
(in millions, except per share information) LOW HIGH LOW
GAAP (loss) /income from continuing operations attributable to shareholders $
(130.0) $
(65.0) $
380.0
Adjusted for:
Amortization 1,400.0 1,400.0 5,600.0
Acquisition, divestiture, licensing and other non-recurring charges 46.0 46.0 135.0
Accretion and fair-value adjustments to contingent consideration 4.0 4.0 15.0
Income taxes on items above and other discrete income tax adjustments (183.0) (183.0) (700.0)
Non-GAAP performance net income attributable to shareholders 1,137.0 1,202.0 5,430.0
Diluted earnings per share
Diluted (loss) / income per share from continuing operations attributable to shareholders- GAAP $
(0.39) $
(0.20) $
1.14
Non-GAAP performance diluted net income per share attributable to shareholders $
3.40 $
3.60 $
16.36
Basic weighted average ordinary shares outstanding 331.0 331.0 330.0
Effect of dilutive securities:
Dilutive shares 3.0 3.0 2.0
Diluted weighted average ordinary shares outstanding 334.0 334.0 332.0
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SOURCE Allergan plc
