Attached files
| file | filename |
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| 8-K - 8-K - Mallinckrodt plc | mnk8-k042718.htm |
MALLINCKRODT PLC | ||||||||||||
INCOME STATEMENT FINANCIAL INFORMATION | ||||||||||||
Fiscal Year Ended December 29, 2017 | ||||||||||||
(unaudited, in millions, except per share data) | ||||||||||||
GAAP Historical As Reported | Adoption of ASU 2017-07(1) | Discontinued Operations | Estimated Amounts Reflective of Impacts | |||||||||
Net sales | $ | 3,221.6 | $ | — | $ | (869.4 | ) | $ | 2,352.2 | |||
Cost of sales | 1,565.3 | (1.2 | ) | (499.2 | ) | 1,064.9 | ||||||
Gross profit | 1,656.3 | 1.2 | (370.2 | ) | 1,287.3 | |||||||
Selling, general and administrative expenses | 920.9 | (71.2 | ) | (77.3 | ) | 772.4 | ||||||
Research and development expenses | 277.3 | (0.4 | ) | (61.6 | ) | 215.3 | ||||||
Restructuring charges, net | 31.2 | — | (5.7 | ) | 25.5 | |||||||
Non-restructuring impairment charges | 63.7 | — | — | 63.7 | ||||||||
Gains on divestiture and license | (56.9 | ) | — | — | (56.9 | ) | ||||||
Operating income | 420.1 | 72.8 | (225.6 | ) | 267.3 | |||||||
Interest expense | (369.1 | ) | — | (369.1 | ) | |||||||
Interest income | 4.6 | — | 4.6 | |||||||||
Other income (expense), net | 6.0 | (72.8 | ) | (4.4 | ) | (71.2 | ) | |||||
Income (loss) from continuing operations before income taxes | 61.6 | — | (230.0 | ) | (168.4 | ) | ||||||
Income tax (benefit) expense | (1,709.6 | ) | — | (80.4 | ) | (1,790.0 | ) | |||||
Income from continuing operations | 1,771.2 | — | (149.6 | ) | 1,621.6 | |||||||
Income from discontinued operations, net of income taxes | 363.2 | — | 149.6 | 512.8 | ||||||||
Net income | $ | 2,134.4 | $ | — | $ | — | $ | 2,134.4 | ||||
Basic earnings per share: | ||||||||||||
Income from continuing operations | $ | 18.13 | $ | 16.60 | ||||||||
Income from discontinued operations | 3.72 | 5.25 | ||||||||||
Net income | 21.85 | 21.85 | ||||||||||
Diluted earnings per share: | ||||||||||||
Income from continuing operations | $ | 18.09 | $ | 16.56 | ||||||||
Income from discontinued operations | 3.71 | 5.24 | ||||||||||
Net income | 21.80 | 21.80 | ||||||||||
Weighted-average number of shares outstanding: | ||||||||||||
Basic | 97.7 | 97.7 | ||||||||||
Diluted | 97.9 | 97.9 | ||||||||||
(1) Effective December 30, 2017, the Company adopted Accounting Standard Update ("ASU") 2017-07, "Compensation - Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Post Retirement Benefit Cost" issued by the Financial Accounting Standards Board. This update requires that the service cost component be disaggregated from the other components of net benefit cost. Service cost should be reported in the same line item or items as other compensation costs arising from services rendered by pertinent employees during the period. The other components of net benefit cost should be presented in the income statement separately from the service cost component and outside a subtotal of income from operations. This ASU requires retroactive application upon adoption.
1
MALLINCKRODT PLC | |||||||||||||
NON-GAAP MEASURES | |||||||||||||
Fiscal Year Ended December 29, 2017 | |||||||||||||
(unaudited, in millions except per share data) | |||||||||||||
Gross profit | Selling, general and administrative expenses | Income from continuing operations | Diluted income from continuing operations per share | ||||||||||
GAAP Historical As Reported | $ | 1,656.3 | $ | 920.9 | $ | 1,771.2 | $ | 18.09 | |||||
ASU Adoption | 1.2 | (71.2 | ) | — | — | ||||||||
Discontinued operations | (370.2 | ) | (77.3 | ) | (149.6 | ) | (1.53 | ) | |||||
Estimated Amounts Reflective of Impacts | 1,287.3 | 772.4 | 1,621.6 | 16.56 | |||||||||
Adjustments: | |||||||||||||
Intangible asset amortization | 668.6 | (8.5 | ) | 677.1 | 6.92 | ||||||||
Restructuring and related charges, net (1) | — | (3.2 | ) | 28.7 | 0.29 | ||||||||
Inventory step-up expense | 10.1 | — | 10.1 | 0.10 | |||||||||
Change in contingent consideration fair value | — | 41.4 | (41.4 | ) | (0.42 | ) | |||||||
Non-restructuring impairment charges | — | — | 63.7 | 0.65 | |||||||||
Debt refinancing | — | — | 10.0 | 0.10 | |||||||||
Acquisition related expenses | — | (7.4 | ) | 7.4 | 0.08 | ||||||||
Intrathecal divestiture | — | — | (56.6 | ) | (0.58 | ) | |||||||
Pension settlement charge | — | — | 69.2 | 0.71 | |||||||||
Reorganization of legal entity ownership (2) | — | — | (1,045.9 | ) | (10.68 | ) | |||||||
U.S. Tax Reform (3) | (457.4 | ) | (4.67 | ) | |||||||||
Income taxes (4) | — | — | (327.0 | ) | (3.34 | ) | |||||||
As adjusted | $ | 1,966.0 | $ | 794.7 | $ | 559.5 | $ | 5.72 | |||||
Percent of net sales | 83.6 | % | 33.8 | % | 23.8 | % | |||||||
(1) Includes pre-tax accelerated depreciation.
(2) Represents the incremental tax and interest expense associated with non-cash internal legal entity reorganization. Of the total adjustment, $8.9 million represents a one-time charge to interest expense related to the reduction in the Company's interest-bearing deferred tax liabilities.
(3) Represents the incremental tax and interest expense associated with the impact of the U.S. tax reform bill being signed into law. Of the total adjustment, $0.5 million represents a one-time reduction to interest expense related to the reduction in the Company's interest-bearing deferred tax liabilities.
(4) Includes tax effects of above adjustments as well as the elimination of deferred tax benefits recognized upon pay down of intercompany installment notes created by internal sales of acquired intangible assets.
2
MALLINCKRODT PLC | ||||||||||||
INCOME STATEMENT FINANCIAL INFORMATION | ||||||||||||
Three Months Ended December 29, 2017 | ||||||||||||
(unaudited, in millions, except per share data) | ||||||||||||
GAAP Historical As Reported | Adoption of ASU 2017-07(1) | Discontinued Operations | Estimated Amounts Reflective of Impacts | |||||||||
Net sales | $ | 792.3 | $ | — | $ | (200.8 | ) | $ | 591.5 | |||
Cost of sales | 371.3 | — | (114.7 | ) | 256.6 | |||||||
Gross profit | 421.0 | — | (86.1 | ) | 334.9 | |||||||
Selling, general and administrative expenses | 175.0 | (0.4 | ) | (20.7 | ) | 153.9 | ||||||
Research and development expenses | 86.4 | — | (15.3 | ) | 71.1 | |||||||
Restructuring charges, net | (0.9 | ) | — | 0.1 | (0.8 | ) | ||||||
Non-restructuring impairment charges | 63.7 | — | — | 63.7 | ||||||||
Gains on divestiture and license | (0.3 | ) | — | — | (0.3 | ) | ||||||
Operating income | 97.1 | 0.4 | (50.2 | ) | 47.3 | |||||||
Interest expense | (90.1 | ) | — | — | (90.1 | ) | ||||||
Interest income | 1.8 | — | — | 1.8 | ||||||||
Other expense, net | (0.2 | ) | (0.4 | ) | — | (0.6 | ) | |||||
Income (loss) from continuing operations before income taxes | 8.6 | — | (50.2 | ) | (41.6 | ) | ||||||
Income tax (benefit) expense | (1,598.8 | ) | — | (37.8 | ) | (1,636.6 | ) | |||||
Income from continuing operations | 1,607.4 | — | (12.4 | ) | 1,595.0 | |||||||
Income from discontinued operations, net of income taxes | 1.3 | — | 12.4 | 13.7 | ||||||||
Net income | $ | 1,608.7 | $ | — | $ | — | $ | 1,608.7 | ||||
Basic earnings per share: | ||||||||||||
Income from continuing operations | $ | 17.43 | $ | 17.30 | ||||||||
Income from discontinued operations | 0.01 | 0.15 | ||||||||||
Net income | 17.45 | 17.45 | ||||||||||
Diluted earnings per share: | ||||||||||||
Income from continuing operations | $ | 17.40 | $ | 17.26 | ||||||||
Income from discontinued operations | 0.01 | 0.15 | ||||||||||
Net income | 17.41 | 17.41 | ||||||||||
Weighted-average number of shares outstanding: | ||||||||||||
Basic | 92.2 | 92.2 | ||||||||||
Diluted | 92.4 | 92.4 | ||||||||||
(1) Reflects the adoption of ASU 2017-07, as previously discussed.
3
MALLINCKRODT PLC | |||||||||||||
NON-GAAP MEASURES | |||||||||||||
Three Months Ended December 29, 2017 | |||||||||||||
(unaudited, in millions except per share data) | |||||||||||||
Gross profit | Selling, general and administrative expenses | Income from continuing operations | Diluted income from continuing operations per share | ||||||||||
GAAP Historical As Reported | $ | 421.0 | $ | 175.0 | $ | 1,607.4 | $ | 17.40 | |||||
ASU Adoption | — | (0.4 | ) | — | — | ||||||||
Discontinued operations | (86.1 | ) | (20.7 | ) | (12.4 | ) | (0.13 | ) | |||||
Estimated Amounts Reflective of Impacts | 334.9 | 153.9 | 1,595.0 | 17.26 | |||||||||
Adjustments: | |||||||||||||
Intangible asset amortization | 167.0 | (1.7 | ) | 168.7 | 1.83 | ||||||||
Restructuring and related charges, net (1) | — | (1.1 | ) | 0.3 | — | ||||||||
Inventory step-up expense | 1.5 | — | 1.5 | 0.02 | |||||||||
Change in contingent consideration fair value | — | 45.5 | (45.5 | ) | (0.49 | ) | |||||||
Acquisition related expenses | — | (5.1 | ) | 5.1 | 0.06 | ||||||||
Non-restructuring impairment charges | — | — | 63.7 | 0.69 | |||||||||
Reorganization of legal entity ownership (2) | — | — | (1,082.0 | ) | (11.71 | ) | |||||||
U.S. Tax Reform (3) | — | — | (457.4 | ) | (4.95 | ) | |||||||
Income taxes (4) | — | — | (107.9 | ) | (1.17 | ) | |||||||
As adjusted | $ | 503.4 | $ | 191.5 | $ | 141.5 | $ | 1.53 | |||||
Percent of net sales | 85.1 | % | 32.4 | % | 23.9 | % | |||||||
(1) Includes pre-tax accelerated depreciation.
(2) Represents the incremental tax and interest expense associated with non-cash internal legal entity reorganization. Of the total adjustment, $8.9 million represents a one-time charge to interest expense related to the reduction in the Company's interest-bearing deferred tax liabilities.
(3) Represents the incremental tax and interest expense associated with the impact of the U.S. tax reform bill being signed into law. Of the total adjustment, $0.5 million represents a one-time reduction to interest expense related to the reduction in the Company's interest-bearing deferred tax liabilities.
(4) Includes tax effects of above adjustments as well as the elimination of deferred tax benefits recognized upon pay down of intercompany installment notes created by internal sales of acquired intangible assets.
4
MALLINCKRODT PLC | ||||||||||||
INCOME STATEMENT FINANCIAL INFORMATION | ||||||||||||
Three Months Ended September 29, 2017 | ||||||||||||
(unaudited, in millions, except per share data) | ||||||||||||
GAAP Historical As Reported | Adoption of ASU 2017-07(1) | Discontinued Operations | Estimated Amounts Reflective of Impacts | |||||||||
Net sales | $ | 793.9 | $ | — | $ | (193.3 | ) | $ | 600.6 | |||
Cost of sales | 393.3 | — | (125.3 | ) | 268.0 | |||||||
Gross profit | 400.6 | — | (68.0 | ) | 332.6 | |||||||
Selling, general and administrative expenses | 205.7 | (0.1 | ) | (19.3 | ) | 186.3 | ||||||
Research and development expenses | 59.5 | — | (12.6 | ) | 46.9 | |||||||
Restructuring charges, net | 14.3 | — | 1.1 | 15.4 | ||||||||
Non-restructuring impairment charges | — | — | — | — | ||||||||
Gains on divestiture and license | 0.4 | — | — | 0.4 | ||||||||
Operating income | 120.7 | 0.1 | (37.2 | ) | 83.6 | |||||||
Interest expense | (92.6 | ) | — | — | (92.6 | ) | ||||||
Interest income | 1.3 | — | — | 1.3 | ||||||||
Other income (expense), net | 3.7 | (0.1 | ) | (0.6 | ) | 3.0 | ||||||
Income (loss) from continuing operations before income taxes | 33.1 | — | (37.8 | ) | (4.7 | ) | ||||||
Income tax (benefit) expense | (31.2 | ) | — | (26.6 | ) | (57.8 | ) | |||||
Income from continuing operations | 64.3 | — | (11.2 | ) | 53.1 | |||||||
(Loss) income from discontinued operations, net of income taxes | (0.6 | ) | — | 11.2 | 10.6 | |||||||
Net income | $ | 63.7 | $ | — | $ | — | $ | 63.7 | ||||
Basic earnings per share: | ||||||||||||
Income from continuing operations | $ | 0.66 | $ | 0.55 | ||||||||
(Loss) income from discontinued operations | (0.01 | ) | 0.11 | |||||||||
Net income | 0.66 | 0.66 | ||||||||||
Diluted earnings per share: | ||||||||||||
Income from continuing operations | $ | 0.66 | $ | 0.55 | ||||||||
(Loss) income from discontinued operations | (0.01 | ) | 0.11 | |||||||||
Net income | 0.66 | 0.66 | ||||||||||
Weighted-average number of shares outstanding: | ||||||||||||
Basic | 96.7 | 96.7 | ||||||||||
Diluted | 97.0 | 97.0 | ||||||||||
(1) Reflects the adoption of ASU 2017-07, as previously discussed.
5
MALLINCKRODT PLC | |||||||||||||
NON-GAAP MEASURES | |||||||||||||
Three Months Ended September 29, 2017 | |||||||||||||
(unaudited, in millions except per share data) | |||||||||||||
Gross profit | Selling, general and administrative expenses | Income from continuing operations | Diluted income from continuing operations per share | ||||||||||
GAAP Historical As Reported | $ | 400.6 | $ | 205.7 | $ | 64.3 | $ | 0.66 | |||||
ASU Adoption | — | (0.1 | ) | — | — | ||||||||
Discontinued operations | (68.0 | ) | (19.3 | ) | (11.2 | ) | (0.12 | ) | |||||
Estimated Amounts Reflective of Impacts | 332.6 | 186.3 | 53.1 | 0.55 | |||||||||
Adjustments: | |||||||||||||
Intangible asset amortization | 167.1 | (2.2 | ) | 169.3 | 1.75 | ||||||||
Restructuring and related charges, net (1) | — | (0.7 | ) | 16.1 | 0.17 | ||||||||
Inventory step-up expense | 2.7 | — | 2.7 | 0.03 | |||||||||
Change in contingent consideration fair value | — | (3.9 | ) | 3.9 | 0.04 | ||||||||
Acquisition related expenses | — | (1.2 | ) | 1.2 | 0.01 | ||||||||
Intrathecal divestiture | — | — | 0.4 | — | |||||||||
Reorganization of legal entity ownership | — | — | 36.1 | 0.37 | |||||||||
Income taxes (2) | — | — | (106.5 | ) | (1.10 | ) | |||||||
As adjusted | $ | 502.4 | $ | 178.3 | $ | 176.3 | $ | 1.82 | |||||
Percent of net sales | 83.6 | % | 29.7 | % | 29.4 | % | |||||||
(1) Includes pre-tax accelerated depreciation.
(2) Includes tax effects of above adjustments as well as the elimination of deferred tax benefits recognized upon pay down of intercompany installment notes created by internal sales of acquired intangible assets.
6
MALLINCKRODT PLC | ||||||||||||
INCOME STATEMENT FINANCIAL INFORMATION | ||||||||||||
Three Months Ended June 30, 2017 | ||||||||||||
(unaudited, in millions, except per share data) | ||||||||||||
GAAP Historical As Reported | Adoption of ASU 2017-07(1) | Discontinued Operations | Estimated Amounts Reflective of Impacts | |||||||||
Net sales | $ | 824.5 | $ | — | $ | (224.4 | ) | $ | 600.1 | |||
Cost of sales | 408.4 | — | (128.0 | ) | 280.4 | |||||||
Gross profit | 416.1 | — | (96.4 | ) | 319.7 | |||||||
Selling, general and administrative expenses | 232.1 | (1.3 | ) | (16.2 | ) | 214.6 | ||||||
Research and development expenses | 69.2 | — | (16.9 | ) | 52.3 | |||||||
Restructuring charges, net | 0.6 | — | — | 0.6 | ||||||||
Gains on divestiture and license | 2.1 | — | — | 2.1 | ||||||||
Operating income | 112.1 | 1.3 | (63.3 | ) | 50.1 | |||||||
Interest expense | (92.2 | ) | — | — | (92.2 | ) | ||||||
Interest income | 0.6 | — | — | 0.6 | ||||||||
Other income (expense), net | 10.0 | (1.3 | ) | (2.4 | ) | 6.3 | ||||||
Income (loss) from continuing operations before income taxes | 30.5 | — | (65.7 | ) | (35.2 | ) | ||||||
Income tax (benefit) expense | (40.1 | ) | — | (13.5 | ) | (53.6 | ) | |||||
Income from continuing operations | 70.6 | — | (52.2 | ) | 18.4 | |||||||
(Loss) income from discontinued operations, net of income taxes | (7.8 | ) | — | 52.2 | 44.4 | |||||||
Net income | $ | 62.8 | $ | — | $ | — | $ | 62.8 | ||||
Basic earnings per share: | ||||||||||||
Income from continuing operations | $ | 0.72 | $ | 0.19 | ||||||||
(Loss) income from discontinued operations | (0.08 | ) | 0.45 | |||||||||
Net income | 0.64 | 0.64 | ||||||||||
Diluted earnings per share: | ||||||||||||
Income from continuing operations | $ | 0.72 | $ | 0.19 | ||||||||
(Loss) income from discontinued operations | (0.08 | ) | 0.45 | |||||||||
Net income | 0.64 | 0.64 | ||||||||||
Weighted-average number of shares outstanding: | ||||||||||||
Basic | 98.5 | 98.5 | ||||||||||
Diluted | 98.7 | 98.7 | ||||||||||
(1) Reflects the adoption of ASU 2017-07, as previously discussed.
7
MALLINCKRODT PLC | |||||||||||||
NON-GAAP MEASURES | |||||||||||||
Three Months Ended June 30, 2017 | |||||||||||||
(unaudited, in millions except per share data) | |||||||||||||
Gross profit | Selling, general and administrative expenses | Income from continuing operations | Diluted income from continuing operations per share | ||||||||||
GAAP Historical As Reported | $ | 416.1 | $ | 232.1 | $ | 70.6 | $ | 0.72 | |||||
ASU Adoption | — | (1.3 | ) | — | — | ||||||||
Discontinued operations | (96.4 | ) | (16.2 | ) | (52.2 | ) | (0.53 | ) | |||||
Estimated Amounts Reflective of Impacts | 319.7 | 214.6 | 18.4 | 0.19 | |||||||||
Adjustments: | |||||||||||||
Intangible asset amortization | 167.0 | (2.3 | ) | 169.3 | 1.72 | ||||||||
Restructuring and related charges, net (1) | — | (0.4 | ) | 1.0 | 0.01 | ||||||||
Inventory step-up expense | 2.9 | — | 2.9 | 0.03 | |||||||||
Change in contingent consideration fair value | — | (2.0 | ) | 2.0 | 0.02 | ||||||||
Acquisition related expenses | — | (1.1 | ) | 1.1 | 0.01 | ||||||||
Intrathecal divestiture | — | — | 2.1 | 0.02 | |||||||||
Income taxes (2) | — | — | (63.0 | ) | (0.64 | ) | |||||||
As adjusted | $ | 489.6 | $ | 208.8 | $ | 133.8 | $ | 1.36 | |||||
Percent of net sales | 81.6 | % | 34.8 | % | 22.3 | % | |||||||
(1) Includes pre-tax accelerated depreciation.
(2) Includes tax effects of above adjustments as well as the elimination of deferred tax benefits recognized upon pay down of intercompany installment notes created by internal sales of acquired intangible assets.
8
MALLINCKRODT PLC | ||||||||||||
INCOME STATEMENT FINANCIAL INFORMATION | ||||||||||||
Three Months Ended March 31, 2017 | ||||||||||||
(unaudited, in millions, except per share data) | ||||||||||||
GAAP Historical As Reported | Adoption of ASU 2017-07(1) | Discontinued Operations | Estimated Amounts Reflective of Impacts | |||||||||
Net sales | $ | 810.9 | $ | — | $ | (250.9 | ) | $ | 560.0 | |||
Cost of sales | 392.3 | (1.2 | ) | (131.2 | ) | 259.9 | ||||||
Gross profit | 418.6 | 1.2 | (119.7 | ) | 300.1 | |||||||
Selling, general and administrative expenses | 308.1 | (69.4 | ) | (21.1 | ) | 217.6 | ||||||
Research and development expenses | 62.2 | (0.4 | ) | (16.8 | ) | 45.0 | ||||||
Restructuring charges, net | 17.2 | — | (6.9 | ) | 10.3 | |||||||
Gains on divestiture and license | (59.1 | ) | — | — | (59.1 | ) | ||||||
Operating income | 90.2 | 71.0 | (74.9 | ) | 86.3 | |||||||
Interest expense | (94.2 | ) | — | — | (94.2 | ) | ||||||
Interest income | 0.9 | — | — | 0.9 | ||||||||
Other expense, net | (7.5 | ) | (71.0 | ) | (1.4 | ) | (79.9 | ) | ||||
(Loss) income from continuing operations before income taxes | (10.6 | ) | — | (76.3 | ) | (86.9 | ) | |||||
Income tax (benefit) expense | (39.5 | ) | — | (2.5 | ) | (42.0 | ) | |||||
Income (loss) from continuing operations | 28.9 | — | (73.8 | ) | (44.9 | ) | ||||||
Income from discontinued operations, net of income taxes | 370.3 | — | 73.8 | 444.1 | ||||||||
Net income | $ | 399.2 | $ | — | $ | — | $ | 399.2 | ||||
Basic earnings per share: | ||||||||||||
Income (loss) from continuing operations | $ | 0.28 | $ | (0.43 | ) | |||||||
Income from discontinued operations | 3.58 | 4.30 | ||||||||||
Net income | 3.86 | 3.86 | ||||||||||
Diluted earnings per share: | ||||||||||||
Income (loss) from continuing operations | $ | 0.28 | $ | (0.43 | ) | |||||||
Income from discontinued operations | 3.57 | 4.29 | ||||||||||
Net income | 3.85 | 3.85 | ||||||||||
Weighted-average number of shares outstanding: | ||||||||||||
Basic | 103.3 | 103.3 | ||||||||||
Diluted | 103.6 | 103.6 | ||||||||||
(1) Reflects the adoption of ASU 2017-07, as previously discussed.
9
MALLINCKRODT PLC | |||||||||||||
NON-GAAP MEASURES | |||||||||||||
Three Months Ended March 31, 2017 | |||||||||||||
(unaudited, in millions except per share data) | |||||||||||||
Gross profit | Selling, general and administrative expenses | Income (loss) from continuing operations | Diluted income from continuing operations per share | ||||||||||
GAAP Historical As Reported | $ | 418.6 | $ | 308.1 | $ | 28.9 | $ | 0.28 | |||||
ASU Adoption | 1.2 | (69.4 | ) | — | — | ||||||||
Discontinued operations | (119.7 | ) | (21.1 | ) | (73.8 | ) | (0.71 | ) | |||||
Estimated Amounts Reflective of Impacts | 300.1 | 217.6 | (44.9 | ) | (0.43 | ) | |||||||
Adjustments: | |||||||||||||
Intangible asset amortization | 167.5 | (2.3 | ) | 169.8 | 1.64 | ||||||||
Restructuring and related charges, net (1) | — | (1.0 | ) | 11.3 | 0.11 | ||||||||
Inventory step-up expense | 3.0 | — | 3.0 | 0.03 | |||||||||
Change in contingent consideration fair value | — | 1.8 | (1.8 | ) | (0.02 | ) | |||||||
Debt refinancing | — | — | 10.0 | 0.10 | |||||||||
Pension settlement charge | — | — | 69.2 | 0.67 | |||||||||
Intrathecal divestiture | — | — | (59.1 | ) | (0.57 | ) | |||||||
Income taxes (2) | — | — | (49.6 | ) | (0.48 | ) | |||||||
As adjusted | $ | 470.6 | $ | 216.1 | $ | 107.9 | $ | 1.04 | |||||
Percent of net sales | 84.0 | % | 38.6 | % | 19.3 | % | |||||||
(1) Includes pre-tax accelerated depreciation.
(2) Includes tax effects of above adjustments as well as the elimination of deferred tax benefits recognized upon pay down of intercompany installment notes created by internal sales of acquired intangible assets.
10
MALLINCKRODT PLC | ||||||||||||
INCOME STATEMENT FINANCIAL INFORMATION | ||||||||||||
Three Months Ended December 30, 2016 | ||||||||||||
(unaudited, in millions, except per share data) | ||||||||||||
GAAP Historical As Reported | Adoption of ASU 2017-07(1) | Discontinued Operations | Estimated Amounts Reflective of Impacts | |||||||||
Net sales | $ | 829.9 | $ | — | $ | (229.5 | ) | $ | 600.4 | |||
Cost of sales | 384.1 | (0.9 | ) | (117.8 | ) | 265.4 | ||||||
Gross profit | 445.8 | 0.9 | (111.7 | ) | 335.0 | |||||||
Selling, general and administrative expenses | 368.3 | (47.2 | ) | (20.0 | ) | 301.1 | ||||||
Research and development expenses | 66.2 | (0.1 | ) | (21.1 | ) | 45.0 | ||||||
Restructuring charges, net | 3.8 | — | (0.3 | ) | 3.5 | |||||||
Non-restructuring impairment charges | 214.3 | — | (207.0 | ) | 7.3 | |||||||
Operating (loss) income | (206.8 | ) | 48.2 | 136.7 | (21.9 | ) | ||||||
Interest expense | (91.3 | ) | — | — | (91.3 | ) | ||||||
Interest income | 0.5 | — | — | 0.5 | ||||||||
Other expense, net | (0.9 | ) | (48.2 | ) | 6.1 | (43.0 | ) | |||||
Income from continuing operations before income taxes | (298.5 | ) | — | 142.8 | (155.7 | ) | ||||||
Income tax (benefit) expense | (121.7 | ) | — | (24.7 | ) | (146.4 | ) | |||||
(Loss) income from continuing operations | (176.8 | ) | — | 167.5 | (9.3 | ) | ||||||
Income (loss) from discontinued operations, net of income taxes | 23.6 | — | (167.5 | ) | (143.9 | ) | ||||||
Net loss | $ | (153.2 | ) | $ | — | $ | — | $ | (153.2 | ) | ||
Basic earnings per share: | ||||||||||||
(Loss) income from continuing operations | $ | (1.67 | ) | $ | (0.09 | ) | ||||||
Income (loss) from discontinued operations | 0.22 | (1.36 | ) | |||||||||
Net loss | (1.45 | ) | (1.45 | ) | ||||||||
Diluted earnings per share: | ||||||||||||
(Loss) income from continuing operations | $ | (1.67 | ) | $ | (0.09 | ) | ||||||
Income (loss) from discontinued operations | 0.22 | (1.36 | ) | |||||||||
Net loss | (1.45 | ) | (1.45 | ) | ||||||||
Weighted-average number of shares outstanding: | ||||||||||||
Basic | 105.7 | 105.7 | ||||||||||
Diluted | 105.7 | 105.7 | ||||||||||
(1) Reflects the adoption of ASU 2017-07, as previously discussed.
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MALLINCKRODT PLC | |||||||||||||
NON-GAAP MEASURES | |||||||||||||
Three Months Ended December 30, 2016 | |||||||||||||
(unaudited, in millions except per share data) | |||||||||||||
Gross profit | Selling, general and administrative expenses | Income (loss) from continuing operations | Diluted income from continuing operations per share | ||||||||||
GAAP Historical As Reported | $ | 445.8 | $ | 368.3 | $ | (176.8 | ) | $ | (1.67 | ) | |||
ASU Adoption | 0.9 | (47.2 | ) | — | — | ||||||||
Discontinued operations | (111.7 | ) | (20.0 | ) | 167.5 | 1.58 | |||||||
Estimated Amounts Reflective of Impacts | 335.0 | 301.1 | (9.3 | ) | (0.09 | ) | |||||||
Adjustments: | |||||||||||||
Intangible asset amortization | 168.7 | (1.6 | ) | 170.3 | 1.61 | ||||||||
Restructuring and related charges, net (1) | — | (1.0 | ) | 4.5 | 0.04 | ||||||||
Inventory step-up expense | 3.6 | — | 3.6 | 0.03 | |||||||||
Change in contingent consideration fair value | — | (1.3 | ) | 1.3 | 0.01 | ||||||||
Acquisition related expenses | — | (0.1 | ) | 0.1 | — | ||||||||
Significant legal and environmental charges | — | (102.0 | ) | 102.0 | 0.96 | ||||||||
Pension settlement charge | — | (45.0 | ) | 45.0 | 0.43 | ||||||||
Income taxes (2) | — | — | (156.7 | ) | (1.48 | ) | |||||||
As adjusted | $ | 507.3 | $ | 150.1 | $ | 160.8 | $ | 1.52 | |||||
Percent of net sales | 84.5 | % | 25.0 | % | 26.8 | % | |||||||
(1) Includes pre-tax accelerated depreciation.
(2) Includes tax effects of above adjustments as well as the elimination of deferred tax benefits recognized upon pay down of intercompany installment notes created by internal sales of acquired intangible assets.
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MALLINCKRODT PLC | ||||||||||||
INCOME STATEMENT FINANCIAL INFORMATION | ||||||||||||
Fiscal Year Ended September 30, 2016 | ||||||||||||
(unaudited, in millions, except per share data) | ||||||||||||
GAAP Historical As Reported | Adoption of ASU 2017-07(1) | Discontinued Operations | Estimated Amounts Reflective of Impacts | |||||||||
Net sales | $ | 3,380.8 | $ | — | $ | (1,088.9 | ) | $ | 2,291.9 | |||
Cost of sales | 1,525.8 | (2.6 | ) | (481.8 | ) | 1,041.4 | ||||||
Gross profit | 1,855.0 | 2.6 | (607.1 | ) | 1,250.5 | |||||||
Selling, general and administrative expenses | 925.3 | (11.6 | ) | (81.5 | ) | 832.2 | ||||||
Research and development expenses | 262.2 | (1.0 | ) | (75.8 | ) | 185.4 | ||||||
Restructuring charges, net | 33.3 | (0.6 | ) | (1.6 | ) | 31.1 | ||||||
Non-restructuring impairment charges | 16.9 | — | — | 16.9 | ||||||||
Operating income | 617.3 | 15.8 | (448.2 | ) | 184.9 | |||||||
Interest expense | (384.6 | ) | — | — | (384.6 | ) | ||||||
Interest income | 1.3 | — | 0.1 | 1.4 | ||||||||
Other expense, net | (0.6 | ) | (15.8 | ) | 4.1 | (12.3 | ) | |||||
Income from continuing operations before income taxes | 233.4 | — | (444.0 | ) | (210.6 | ) | ||||||
Income tax (benefit) expense | (255.6 | ) | — | (163.0 | ) | (418.6 | ) | |||||
Income from continuing operations | 489.0 | — | (281.0 | ) | 208.0 | |||||||
Income from discontinued operations, net of income taxes | 154.7 | — | 281.0 | 435.7 | ||||||||
Net income | $ | 643.7 | $ | — | $ | — | $ | 643.7 | ||||
Basic earnings per share: | ||||||||||||
Income from continuing operations | $ | 4.42 | $ | 1.88 | ||||||||
Income from discontinued operations | 1.40 | 3.94 | ||||||||||
Net income | 5.82 | 5.82 | ||||||||||
Diluted earnings per share: | ||||||||||||
Income from continuing operations | $ | 4.39 | $ | 1.87 | ||||||||
Income from discontinued operations | 1.39 | 3.91 | ||||||||||
Net income | 5.77 | 5.77 | ||||||||||
Weighted-average number of shares outstanding: | ||||||||||||
Basic | 110.6 | 110.6 | ||||||||||
Diluted | 111.5 | 111.5 | ||||||||||
(1) Reflects the adoption of ASU 2017-07, as previously discussed.
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MALLINCKRODT PLC | |||||||||||||
NON-GAAP MEASURES | |||||||||||||
Fiscal Year Ended September 30, 2016 | |||||||||||||
(unaudited, in millions except per share data) | |||||||||||||
Gross profit | Selling, general and administrative expenses | Income from continuing operations | Diluted income from continuing operations per share | ||||||||||
GAAP Historical As Reported | $ | 1,855.0 | $ | 925.3 | $ | 489.0 | $ | 4.39 | |||||
ASU Adoption | 2.6 | (11.6 | ) | — | — | ||||||||
Discontinued operations | (607.1 | ) | (81.5 | ) | (281.0 | ) | (2.52 | ) | |||||
Estimated Amounts Reflective of Impacts | 1,250.5 | 832.2 | 208.0 | 1.87 | |||||||||
Adjustments: | |||||||||||||
Intangible asset amortization | 671.6 | (7.1 | ) | 678.7 | 6.09 | ||||||||
Restructuring and related charges, net (1) | — | (3.1 | ) | 34.8 | 0.31 | ||||||||
Inventory step-up expense | 24.3 | — | 24.3 | 0.22 | |||||||||
Change in contingent consideration fair value | — | (4.4 | ) | 4.4 | 0.04 | ||||||||
Acquisition related expenses | — | (6.9 | ) | 6.9 | 0.06 | ||||||||
Non-restructuring impairment charges | — | — | 16.9 | 0.15 | |||||||||
Income taxes (2) | — | — | (409.4 | ) | (3.67 | ) | |||||||
As adjusted | $ | 1,946.4 | $ | 810.7 | $ | 564.6 | $ | 5.06 | |||||
Percent of net sales | 84.9 | % | 35.4 | % | 24.6 | % | |||||||
(1) Includes pre-tax accelerated depreciation.
(2) Includes tax effects of above adjustments as well as the elimination of deferred tax benefits recognized upon pay down of intercompany installment notes created by internal sales of acquired intangible assets.
14