ENDO REPORTS FOURTH-QUARTER AND FULL-YEAR 2021 FINANCIAL RESULTS
"Endo's solid operational and financial performance in the fourth-quarter ended a year of strong performance across all of our business segments," said
FOURTH-QUARTER FINANCIAL PERFORMANCE |
|||||||||||
(in thousands, except per share amounts) |
|||||||||||
Three Months Ended |
Year Ended |
||||||||||
2021 |
2020 |
Change |
2021 |
2020 |
Change |
||||||
Total Revenues, Net |
$ 789,429 |
$ 760,221 |
4% |
$ 2,993,206 |
$ 2,903,074 |
3% |
|||||
Reported (Loss) Income from Continuing Operations |
$ (556,667) |
$ 141,247 |
NM |
$ (569,081) |
$ 247,464 |
NM |
|||||
Reported Diluted Weighted Average Shares |
233,681 |
234,474 |
—% |
232,785 |
233,653 |
—% |
|||||
Reported Diluted Net (Loss) Income per Share from Continuing Operations |
$ (2.38) |
$ 0.60 |
NM |
$ (2.44) |
$ 1.06 |
NM |
|||||
Reported Net (Loss) Income |
$ (562,062) |
$ 119,343 |
NM |
$ (613,245) |
$ 183,944 |
NM |
|||||
Adjusted Income from Continuing Operations (2) |
$ 200,034 |
$ 175,995 |
14% |
$ 716,349 |
$ 670,370 |
7% |
|||||
Adjusted Diluted Weighted Average Shares (1)(2) |
237,045 |
234,474 |
1% |
236,665 |
233,653 |
1% |
|||||
Adjusted Diluted Net Income per Share from Continuing Operations (2) |
$ 0.84 |
$ 0.75 |
12% |
$ 3.03 |
$ 2.87 |
6% |
|||||
Adjusted EBITDA (2) |
$ 386,524 |
$ 351,635 |
10% |
$ 1,480,822 |
$ 1,395,942 |
6% |
__________ |
|
(1) |
Reported Diluted Net (Loss) Income per Share from Continuing Operations is computed based on weighted average shares outstanding and, if there is income from continuing operations during the period, the dilutive impact of ordinary share equivalents outstanding during the period. In the case of Adjusted Diluted Weighted Average Shares, Adjusted Income from Continuing Operations is used in determining whether to include such dilutive impact. |
(2) |
The information presented in the table above includes non-GAAP financial measures such as "Adjusted Income from Continuing Operations," "Adjusted Diluted Weighted Average Shares," "Adjusted Diluted Net Income per Share from Continuing Operations" and "Adjusted EBITDA." Refer to the "Supplemental Financial Information" section below for reconciliations of certain non-GAAP financial measures to the most directly comparable GAAP financial measures. |
CONSOLIDATED RESULTS
Total revenues were
Reported loss from continuing operations in fourth-quarter 2021 was
Adjusted income from continuing operations in fourth-quarter 2021 was
BRANDED PHARMACEUTICALS SEGMENT
Fourth-quarter 2021
Despite increasing COVID-19 driven pressures during the fourth-quarter 2021, Specialty Products revenues increased 4% to
STERILE INJECTABLES SEGMENT
Fourth-quarter 2021 Sterile Injectables segment revenues were
GENERIC PHARMACEUTICALS SEGMENT
Fourth-quarter 2021
INTERNATIONAL PHARMACEUTICALS SEGMENT
Fourth-quarter 2021
FIRST-QUARTER 2022 FINANCIAL GUIDANCE
Due to uncertainties in certain key assumptions including the timing and impact of VASOSTRICT® generic competition and the rate and extent to which the market for specialty product office-based procedures recovers from the current COVID-19 driven challenges, the Company is only providing financial guidance for the first quarter ending
First-Quarter 2022 |
|
Total Revenues, Net |
|
Adjusted EBITDA |
|
Adjusted Diluted Net Income per Share from Continuing Operations |
|
Assumptions: |
|
Adjusted Gross Margin |
~71.5% |
Adjusted Operating Expenses as a Percentage of Total Revenues, Net |
~33.0% |
Adjusted Interest Expense |
|
Adjusted Effective Tax Rate |
|
Adjusted Diluted Weighted Average Shares |
~238M |
BALANCE SHEET, LIQUIDITY AND OTHER UPDATES
As of
Fourth-quarter 2021 net cash used in operating activities was
Additionally, during the fourth-quarter 2021, the Company completed the previously announced sales of its manufacturing sites in
CONFERENCE CALL INFORMATION
Endo will conduct a conference call with financial analysts to discuss this press release tomorrow,
A replay of the call will be available from
A simultaneous webcast of the call can be accessed by visiting https://investor.endo.com/events-and-presentations. In addition, a replay of the webcast will be available on the Company website for one year following the event.
Chantix® is a registered trademark of Pfizer Inc.
Amitiza® is a registered trademark of Mallinckrodt plc.
FINANCIAL SCHEDULES
The following table presents Endo's unaudited Total revenues, net for the three months and years ended
Three Months Ended |
Percent |
Year Ended |
Percent |
||||||||
2021 |
2020 |
2021 |
2020 |
||||||||
|
|||||||||||
Specialty Products: |
|||||||||||
XIAFLEX® |
$ 120,078 |
$ 105,212 |
14% |
$ 432,344 |
$ 316,234 |
37% |
|||||
SUPPRELIN® LA |
28,709 |
24,838 |
16% |
114,374 |
88,182 |
30% |
|||||
Other Specialty (1) |
12,025 |
23,867 |
(50)% |
86,432 |
92,662 |
(7)% |
|||||
Total Specialty Products |
$ 160,812 |
$ 153,917 |
4% |
$ 633,150 |
$ 497,078 |
27% |
|||||
Established Products: |
|||||||||||
PERCOCET® |
$ 25,093 |
$ 27,323 |
(8)% |
$ 103,788 |
$ 110,112 |
(6)% |
|||||
TESTOPEL® |
11,322 |
8,357 |
35% |
43,636 |
35,234 |
24% |
|||||
Other Established (2) |
30,738 |
34,907 |
(12)% |
113,043 |
139,356 |
(19)% |
|||||
Total Established Products |
$ 67,153 |
$ 70,587 |
(5)% |
$ 260,467 |
$ 284,702 |
(9)% |
|||||
|
$ 227,965 |
$ 224,504 |
2% |
$ 893,617 |
$ 781,780 |
14% |
|||||
Sterile Injectables: |
|||||||||||
VASOSTRICT® |
$ 224,971 |
$ 213,116 |
6% |
$ 901,735 |
$ 785,646 |
15% |
|||||
ADRENALIN® |
36,494 |
31,739 |
15% |
124,630 |
152,074 |
(18)% |
|||||
Other Sterile Injectables (4) |
57,634 |
86,995 |
(34)% |
239,732 |
301,127 |
(20)% |
|||||
Total Sterile Injectables (3) |
$ 319,099 |
$ 331,850 |
(4)% |
$ 1,266,097 |
$ 1,238,847 |
2% |
|||||
|
$ 218,135 |
$ 180,440 |
21% |
$ 740,586 |
$ 783,110 |
(5)% |
|||||
|
$ 24,230 |
$ 23,427 |
3% |
$ 92,906 |
$ 99,337 |
(6)% |
|||||
Total revenues, net |
$ 789,429 |
$ 760,221 |
4% |
$ 2,993,206 |
$ 2,903,074 |
3% |
__________ |
|
(1) |
Products included within Other Specialty include NASCOBAL® Nasal Spray, AVEED® and QWO®. |
(2) |
Products included within Other Established include, but are not limited to, EDEX® and LIDODERM®. |
(3) |
Individual products presented above represent the top two performing products in each product category for the year ended |
(4) |
Products included within Other Sterile Injectables include ertapenem for injection, APLISOL® and others. |
The following table presents unaudited Condensed Consolidated Statement of Operations data for the three months and years ended
Three Months Ended |
Year Ended |
||||||
2021 |
2020 |
2021 |
2020 |
||||
TOTAL REVENUES, NET |
$ 789,429 |
$ 760,221 |
$ 2,993,206 |
$ 2,903,074 |
|||
COSTS AND EXPENSES: |
|||||||
Cost of revenues |
311,223 |
369,539 |
1,221,064 |
1,442,511 |
|||
Selling, general and administrative |
250,103 |
176,221 |
861,760 |
698,506 |
|||
Research and development |
58,536 |
64,737 |
148,560 |
158,902 |
|||
Litigation-related and other contingencies, net |
226,168 |
4,889 |
345,495 |
(19,049) |
|||
Asset impairment charges |
364,584 |
14,147 |
414,977 |
120,344 |
|||
Acquisition-related and integration items, net |
(2,022) |
(551) |
(8,379) |
16,549 |
|||
Interest expense, net |
143,501 |
135,250 |
562,353 |
532,939 |
|||
Loss on extinguishment of debt |
— |
— |
13,753 |
— |
|||
Other (income) expense, net |
(15,103) |
4,208 |
(19,774) |
(21,110) |
|||
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAX |
$ (547,561) |
$ (8,219) |
$ (546,603) |
$ (26,518) |
|||
INCOME TAX EXPENSE (BENEFIT) |
9,106 |
(149,466) |
22,478 |
(273,982) |
|||
(LOSS) INCOME FROM CONTINUING OPERATIONS |
$ (556,667) |
$ 141,247 |
$ (569,081) |
$ 247,464 |
|||
DISCONTINUED OPERATIONS, NET OF TAX |
(5,395) |
(21,904) |
(44,164) |
(63,520) |
|||
NET (LOSS) INCOME |
$ (562,062) |
$ 119,343 |
$ (613,245) |
$ 183,944 |
|||
NET (LOSS) INCOME PER SHARE—BASIC: |
|||||||
Continuing operations |
$ (2.38) |
$ 0.61 |
$ (2.44) |
$ 1.08 |
|||
Discontinued operations |
(0.03) |
(0.09) |
(0.19) |
(0.28) |
|||
Basic |
$ (2.41) |
$ 0.52 |
$ (2.63) |
$ 0.80 |
|||
NET (LOSS) INCOME PER SHARE—DILUTED: |
|||||||
Continuing operations |
$ (2.38) |
$ 0.60 |
$ (2.44) |
$ 1.06 |
|||
Discontinued operations |
(0.03) |
(0.09) |
(0.19) |
(0.27) |
|||
Diluted |
$ (2.41) |
$ 0.51 |
$ (2.63) |
$ 0.79 |
|||
WEIGHTED AVERAGE SHARES: |
|||||||
Basic |
233,681 |
230,301 |
232,785 |
229,314 |
|||
Diluted |
233,681 |
234,474 |
232,785 |
233,653 |
The following table presents unaudited Condensed Consolidated Balance Sheet data at
|
|
||
ASSETS |
|||
CURRENT ASSETS: |
|||
Cash and cash equivalents |
$ 1,507,196 |
$ 1,213,437 |
|
Restricted cash and cash equivalents |
124,114 |
171,563 |
|
Accounts receivable |
592,019 |
511,262 |
|
Inventories, net |
283,552 |
352,260 |
|
Other current assets |
207,705 |
164,736 |
|
Total current assets |
$ 2,714,586 |
$ 2,413,258 |
|
TOTAL NON-CURRENT ASSETS |
6,052,829 |
6,851,379 |
|
TOTAL ASSETS |
$ 8,767,415 |
$ 9,264,637 |
|
LIABILITIES AND SHAREHOLDERS' DEFICIT |
|||
CURRENT LIABILITIES: |
|||
Accounts payable and accrued expenses, including legal settlement accruals |
$ 1,417,892 |
$ 1,208,061 |
|
Other current liabilities |
212,070 |
45,763 |
|
Total current liabilities |
$ 1,629,962 |
$ 1,253,824 |
|
LONG-TERM DEBT, LESS CURRENT PORTION, NET |
8,048,980 |
8,280,578 |
|
OTHER LIABILITIES |
332,459 |
378,174 |
|
SHAREHOLDERS' DEFICIT |
(1,243,986) |
(647,939) |
|
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT |
$ 8,767,415 |
$ 9,264,637 |
The following table presents unaudited Condensed Consolidated Statement of Cash Flow data for the years ended
Year Ended December 31, |
|||
2021 |
2020 |
||
OPERATING ACTIVITIES: |
|||
Net (loss) income |
$ (613,245) |
$ 183,944 |
|
Adjustments to reconcile Net (loss) income to Net cash provided by operating activities: |
|||
Depreciation and amortization |
457,098 |
518,807 |
|
Asset impairment charges |
414,977 |
120,344 |
|
Other, including cash payments to claimants from Qualified Settlement Funds |
152,220 |
(425,703) |
|
Net cash provided by operating activities |
$ 411,050 |
$ 397,392 |
|
INVESTING ACTIVITIES: |
|||
Capital expenditures, excluding capitalized interest |
$ (77,929) |
$ (69,971) |
|
Acquisitions, including in-process research and development, net of cash and restricted cash acquired |
(5,000) |
(649,504) |
|
Proceeds from sales and maturities of investments |
— |
92,763 |
|
Proceeds from sale of business and other assets, net |
30,283 |
6,737 |
|
Other |
(6,898) |
(4,892) |
|
Net cash used in investing activities |
$ (59,544) |
$ (624,867) |
|
FINANCING ACTIVITIES: |
|||
Payments on borrowings, net |
$ (78,745) |
$ (96,683) |
|
Other |
(26,736) |
(11,884) |
|
Net cash used in financing activities |
$ (105,481) |
$ (108,567) |
|
Effect of foreign exchange rate |
285 |
654 |
|
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS |
$ 246,310 |
$ (335,388) |
|
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS, BEGINNING OF PERIOD |
1,385,000 |
1,720,388 |
|
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS, END OF PERIOD |
$ 1,631,310 |
$ 1,385,000 |
SUPPLEMENTAL FINANCIAL INFORMATION
To supplement the financial measures prepared in accordance with
The tables below provide reconciliations of certain of the Company's non-GAAP financial measures to their most directly comparable GAAP amounts. Refer to the "Notes to the Reconciliations of GAAP and Non-GAAP Financial Measures" section below for additional details regarding the adjustments to the non-GAAP financial measures detailed throughout this Supplemental Financial Information section.
Reconciliation of EBITDA and Adjusted EBITDA (non-GAAP)
The following table provides a reconciliation of Net (loss) income (GAAP) to Adjusted EBITDA (non-GAAP) for the three months and years ended
Three Months Ended |
Year Ended |
||||||
2021 |
2020 |
2021 |
2020 |
||||
Net (loss) income (GAAP) |
$ (562,062) |
$ 119,343 |
$ (613,245) |
$ 183,944 |
|||
Income tax expense (benefit) |
9,106 |
(149,466) |
22,478 |
(273,982) |
|||
Interest expense, net |
143,501 |
135,250 |
562,353 |
532,939 |
|||
Depreciation and amortization (14) |
104,254 |
119,562 |
432,380 |
496,349 |
|||
EBITDA (non-GAAP) |
$ (305,201) |
$ 224,689 |
$ 403,966 |
$ 939,250 |
|||
Upfront and milestone-related payments (2) |
$ 20,245 |
$ 32,606 |
$ 26,451 |
$ 35,075 |
|||
Amounts related to continuity and separation benefits, |
32,280 |
25,926 |
90,912 |
126,282 |
|||
Certain litigation-related and other contingencies, net (4) |
226,168 |
4,889 |
345,495 |
(19,049) |
|||
Certain legal costs (5) |
53,187 |
15,935 |
136,148 |
67,819 |
|||
Asset impairment charges (6) |
364,584 |
14,147 |
414,977 |
120,344 |
|||
Acquisition-related and integration costs (7) |
— |
196 |
414 |
196 |
|||
Fair value of contingent consideration (8) |
(2,022) |
(747) |
(8,793) |
16,353 |
|||
Loss on extinguishment of debt (9) |
— |
— |
13,753 |
— |
|||
Share-based compensation (14) |
6,990 |
7,905 |
29,227 |
36,167 |
|||
Other (income) expense, net (15) |
(15,103) |
4,208 |
(19,774) |
(21,110) |
|||
Other (10) |
1 |
(23) |
3,882 |
31,095 |
|||
Discontinued operations, net of tax (12) |
5,395 |
21,904 |
44,164 |
63,520 |
|||
Adjusted EBITDA (non-GAAP) |
$ 386,524 |
$ 351,635 |
$ 1,480,822 |
$ 1,395,942 |
Reconciliation of Adjusted Income from Continuing Operations (non-GAAP)
The following table provides a reconciliation of the Company's (Loss) income from continuing operations (GAAP) to Adjusted income from continuing operations (non-GAAP) for the three months and years ended
Three Months Ended |
Year Ended |
||||||
2021 |
2020 |
2021 |
2020 |
||||
(Loss) income from continuing operations (GAAP) |
$ (556,667) |
$ 141,247 |
$ (569,081) |
$ 247,464 |
|||
Non-GAAP adjustments: |
|||||||
Amortization of intangible assets (1) |
91,806 |
101,742 |
372,907 |
427,543 |
|||
Upfront and milestone-related payments (2) |
20,245 |
32,606 |
26,451 |
35,075 |
|||
Amounts related to continuity and separation benefits, |
32,280 |
25,926 |
90,912 |
126,282 |
|||
Certain litigation-related and other contingencies, net (4) |
226,168 |
4,889 |
345,495 |
(19,049) |
|||
Certain legal costs (5) |
53,187 |
15,935 |
136,148 |
67,819 |
|||
Asset impairment charges (6) |
364,584 |
14,147 |
414,977 |
120,344 |
|||
Acquisition-related and integration costs (7) |
— |
196 |
414 |
196 |
|||
Fair value of contingent consideration (8) |
(2,022) |
(747) |
(8,793) |
16,353 |
|||
Loss on extinguishment of debt (9) |
— |
— |
13,753 |
— |
|||
Other (10) |
(15,325) |
3,727 |
(15,870) |
17,164 |
|||
Tax adjustments (11) |
(14,222) |
(163,673) |
(90,964) |
(368,821) |
|||
Adjusted income from continuing operations (non-GAAP) |
$ 200,034 |
$ 175,995 |
$ 716,349 |
$ 670,370 |
Reconciliation of Other Adjusted Income Statement Data (non-GAAP)
The following tables provide detailed reconciliations of various other income statement data between the GAAP and non-GAAP amounts for the three months and years ended
Three Months Ended |
|||||||||||||||||||||||||||||||
Total |
Cost of |
Gross |
Gross |
Total |
Operating |
Operating |
Operating |
Other non- |
(Loss) |
Income tax |
Effective |
(Loss) |
Discontinued |
Net (loss) |
Diluted |
||||||||||||||||
Reported (GAAP) |
$ 789,429 |
$ 311,223 |
$ 478,206 |
60.6% |
$ 897,369 |
113.7% |
|
(53.1)% |
$ 128,398 |
|
$ 9,106 |
(1.7)% |
|
$ (5,395) |
|
$ (2.38) |
|||||||||||||||
Items impacting comparability: |
|||||||||||||||||||||||||||||||
Amortization of intangible assets (1) |
— |
(91,806) |
91,806 |
— |
91,806 |
— |
91,806 |
— |
91,806 |
— |
91,806 |
||||||||||||||||||||
Upfront and milestone-related payments (2) |
— |
(125) |
125 |
(20,120) |
20,245 |
— |
20,245 |
— |
20,245 |
— |
20,245 |
||||||||||||||||||||
Amounts related to continuity and separation benefits, |
— |
949 |
(949) |
(33,229) |
32,280 |
— |
32,280 |
— |
32,280 |
— |
32,280 |
||||||||||||||||||||
Certain litigation-related and other contingencies, net (4) |
— |
— |
— |
(226,168) |
226,168 |
— |
226,168 |
— |
226,168 |
— |
226,168 |
||||||||||||||||||||
Certain legal costs (5) |
— |
— |
— |
(53,187) |
53,187 |
— |
53,187 |
— |
53,187 |
— |
53,187 |
||||||||||||||||||||
Asset impairment charges (6) |
— |
— |
— |
(364,584) |
364,584 |
— |
364,584 |
— |
364,584 |
— |
364,584 |
||||||||||||||||||||
Fair value of contingent consideration (8) |
— |
— |
— |
2,022 |
(2,022) |
— |
(2,022) |
— |
(2,022) |
— |
(2,022) |
||||||||||||||||||||
Other (10) |
— |
— |
— |
— |
— |
15,325 |
(15,325) |
— |
(15,325) |
— |
(15,325) |
||||||||||||||||||||
Tax adjustments (11) |
— |
— |
— |
— |
— |
— |
— |
14,222 |
(14,222) |
— |
(14,222) |
||||||||||||||||||||
Exclude discontinued operations, net of tax (12) |
— |
— |
— |
— |
— |
— |
— |
— |
— |
5,395 |
5,395 |
||||||||||||||||||||
After considering items (non-GAAP) |
$ 789,429 |
$ 220,241 |
$ 569,188 |
72.1% |
$ 202,103 |
25.6% |
$ 367,085 |
46.5% |
$ 143,723 |
$ 223,362 |
$ 23,328 |
10.4% |
$ 200,034 |
$ — |
$ 200,034 |
$ 0.84 |
Three Months Ended |
|||||||||||||||||||||||||||||||
Total |
Cost of |
Gross |
Gross |
Total |
Operating |
Operating |
Operating |
Other non- |
(Loss) |
Income tax |
Effective |
Income |
Discontinued |
Net |
Diluted |
||||||||||||||||
Reported (GAAP) |
$ 760,221 |
$ 369,539 |
$ 390,682 |
51.4% |
$ 259,443 |
34.1% |
$ 131,239 |
17.3% |
$ 139,458 |
$ (8,219) |
|
1,818.5% |
$ 141,247 |
$ (21,904) |
$ 119,343 |
$ 0.60 |
|||||||||||||||
Items impacting comparability: |
|||||||||||||||||||||||||||||||
Amortization of intangible assets (1) |
— |
(101,742) |
101,742 |
— |
101,742 |
— |
101,742 |
— |
101,742 |
— |
101,742 |
||||||||||||||||||||
Upfront and milestone-related payments (2) |
— |
(925) |
925 |
(31,681) |
32,606 |
— |
32,606 |
— |
32,606 |
— |
32,606 |
||||||||||||||||||||
Amounts related to continuity and separation benefits, |
— |
(11,721) |
11,721 |
(14,205) |
25,926 |
— |
25,926 |
— |
25,926 |
— |
25,926 |
||||||||||||||||||||
Certain litigation-related and other contingencies, net (4) |
— |
— |
— |
(4,889) |
4,889 |
— |
4,889 |
— |
4,889 |
— |
4,889 |
||||||||||||||||||||
Certain legal costs (5) |
— |
— |
— |
(15,935) |
15,935 |
— |
15,935 |
— |
15,935 |
— |
15,935 |
||||||||||||||||||||
Asset impairment charges (6) |
— |
— |
— |
(14,147) |
14,147 |
— |
14,147 |
— |
14,147 |
— |
14,147 |
||||||||||||||||||||
Acquisition-related and integration costs (7) |
— |
— |
— |
(196) |
196 |
— |
196 |
— |
196 |
— |
196 |
||||||||||||||||||||
Fair value of contingent consideration (8) |
— |
— |
— |
747 |
(747) |
— |
(747) |
— |
(747) |
— |
(747) |
||||||||||||||||||||
Other (10) |
— |
— |
— |
— |
— |
(3,727) |
3,727 |
— |
3,727 |
— |
3,727 |
||||||||||||||||||||
Tax adjustments (11) |
— |
— |
— |
— |
— |
— |
— |
163,673 |
(163,673) |
— |
(163,673) |
||||||||||||||||||||
Exclude discontinued operations, net of tax (12) |
— |
— |
— |
— |
— |
— |
— |
— |
— |
21,904 |
21,904 |
||||||||||||||||||||
After considering items (non-GAAP) |
$ 760,221 |
$ 255,151 |
$ 505,070 |
66.4% |
$ 179,137 |
23.6% |
$ 325,933 |
42.9% |
$ 135,731 |
$ 190,202 |
$ 14,207 |
7.5% |
$ 175,995 |
$ — |
$ 175,995 |
$ 0.75 |
Year Ended |
|||||||||||||||||||||||||||||||
Total |
Cost of |
Gross |
Gross |
Total |
Operating |
Operating |
Operating |
Other non- |
(Loss) |
Income tax |
Effective |
(Loss) |
Discontinued |
Net (loss) |
Diluted |
||||||||||||||||
Reported (GAAP) |
|
|
|
59.2% |
|
58.9% |
$ 9,729 |
0.3% |
$ 556,332 |
|
$ 22,478 |
(4.1)% |
|
$ (44,164) |
|
$ (2.44) |
|||||||||||||||
Items impacting comparability: |
|||||||||||||||||||||||||||||||
Amortization of intangible assets (1) |
— |
(372,907) |
372,907 |
— |
372,907 |
— |
372,907 |
— |
372,907 |
— |
372,907 |
||||||||||||||||||||
Upfront and milestone-related payments (2) |
— |
(1,301) |
1,301 |
(25,150) |
26,451 |
— |
26,451 |
— |
26,451 |
— |
26,451 |
||||||||||||||||||||
Amounts related to continuity and separation benefits, |
— |
(9,058) |
9,058 |
(81,854) |
90,912 |
— |
90,912 |
— |
90,912 |
— |
90,912 |
||||||||||||||||||||
Certain litigation-related and other contingencies, net (4) |
— |
— |
— |
(345,495) |
345,495 |
— |
345,495 |
— |
345,495 |
— |
345,495 |
||||||||||||||||||||
Certain legal costs (5) |
— |
— |
— |
(136,148) |
136,148 |
— |
136,148 |
— |
136,148 |
— |
136,148 |
||||||||||||||||||||
Asset impairment charges (6) |
— |
— |
— |
(414,977) |
414,977 |
— |
414,977 |
— |
414,977 |
— |
414,977 |
||||||||||||||||||||
Acquisition-related and integration costs (7) |
— |
— |
— |
(414) |
414 |
— |
414 |
— |
414 |
— |
414 |
||||||||||||||||||||
Fair value of contingent consideration (8) |
— |
— |
— |
8,793 |
(8,793) |
— |
(8,793) |
— |
(8,793) |
— |
(8,793) |
||||||||||||||||||||
Loss on extinguishment of debt (9) |
— |
— |
— |
— |
— |
(13,753) |
13,753 |
— |
13,753 |
— |
13,753 |
||||||||||||||||||||
Other (10) |
— |
— |
— |
(3,879) |
3,879 |
19,749 |
(15,870) |
— |
(15,870) |
— |
(15,870) |
||||||||||||||||||||
Tax adjustments (11) |
— |
— |
— |
— |
— |
— |
— |
90,964 |
(90,964) |
— |
(90,964) |
||||||||||||||||||||
Exclude discontinued operations, net of tax (12) |
— |
— |
— |
— |
— |
— |
— |
— |
— |
44,164 |
44,164 |
||||||||||||||||||||
After considering items (non-GAAP) |
|
$ 837,798 |
|
72.0% |
$ 763,289 |
25.5% |
|
46.5% |
$ 562,328 |
$ 829,791 |
$ 113,442 |
13.7% |
$ 716,349 |
$ — |
$ 716,349 |
$ 3.03 |
Year Ended |
|||||||||||||||||||||||||||||||
Total |
Cost of |
Gross |
Gross |
Total |
Operating |
Operating |
Operating |
Other |
(Loss) |
Income tax |
Effective |
Income |
Discontinued |
Net |
Diluted |
||||||||||||||||
Reported (GAAP) |
|
|
|
50.3% |
$ 975,252 |
33.6% |
$ 485,311 |
16.7% |
$ 511,829 |
$ (26,518) |
|
1,033.2% |
$ 247,464 |
$ (63,520) |
$ 183,944 |
$ 1.06 |
|||||||||||||||
Items impacting comparability: |
|||||||||||||||||||||||||||||||
Amortization of intangible assets (1) |
— |
(427,543) |
427,543 |
— |
427,543 |
— |
427,543 |
— |
427,543 |
— |
427,543 |
||||||||||||||||||||
Upfront and milestone-related payments (2) |
— |
(1,717) |
1,717 |
(33,358) |
35,075 |
— |
35,075 |
— |
35,075 |
— |
35,075 |
||||||||||||||||||||
Amounts related to continuity and separation benefits, |
— |
(55,413) |
55,413 |
(70,869) |
126,282 |
— |
126,282 |
— |
126,282 |
— |
126,282 |
||||||||||||||||||||
Certain litigation-related and other contingencies, net (4) |
— |
— |
— |
19,049 |
(19,049) |
— |
(19,049) |
— |
(19,049) |
— |
(19,049) |
||||||||||||||||||||
Certain legal costs (5) |
— |
— |
— |
(67,819) |
67,819 |
— |
67,819 |
— |
67,819 |
— |
67,819 |
||||||||||||||||||||
Asset impairment charges (6) |
— |
— |
— |
(120,344) |
120,344 |
— |
120,344 |
— |
120,344 |
— |
120,344 |
||||||||||||||||||||
Acquisition-related and integration costs (7) |
— |
— |
— |
(196) |
196 |
— |
196 |
— |
196 |
— |
196 |
||||||||||||||||||||
Fair value of contingent consideration (8) |
— |
— |
— |
(16,353) |
16,353 |
— |
16,353 |
— |
16,353 |
— |
16,353 |
||||||||||||||||||||
Other (10) |
— |
— |
— |
(31,118) |
31,118 |
13,954 |
17,164 |
— |
17,164 |
— |
17,164 |
||||||||||||||||||||
Tax adjustments (11) |
— |
— |
— |
— |
— |
— |
— |
368,821 |
(368,821) |
— |
(368,821) |
||||||||||||||||||||
Exclude discontinued operations, net of tax (12) |
— |
— |
— |
— |
— |
— |
— |
— |
— |
63,520 |
63,520 |
||||||||||||||||||||
After considering items (non-GAAP) |
|
$ 957,838 |
|
67.0% |
$ 654,244 |
22.5% |
|
44.5% |
$ 525,783 |
$ 765,209 |
$ 94,839 |
12.4% |
$ 670,370 |
$ — |
$ 670,370 |
$ 2.87 |
Notes to the Reconciliations of GAAP and Non-GAAP Financial Measures
Notes to certain line items included in the reconciliations of the GAAP financial measures to the non-GAAP financial measures for the three months and years ended
(1) |
To exclude amortization expense related to intangible assets. |
||||||
(2) |
Adjustments for upfront and milestone-related payments to partners included the following (in thousands): |
||||||
Three Months Ended |
|||||||
2021 |
2020 |
||||||
Cost of revenues |
Operating expenses |
Cost of revenues |
Operating expenses |
||||
Sales-based |
$ 125 |
$ — |
$ 925 |
$ — |
|||
Development-based |
— |
20,120 |
— |
31,681 |
|||
Total |
$ 125 |
$ 20,120 |
$ 925 |
$ 31,681 |
|||
Year Ended |
|||||||
2021 |
2020 |
||||||
Cost of revenues |
Operating expenses |
Cost of revenues |
Operating expenses |
||||
Sales-based |
$ 1,301 |
$ — |
$ 1,717 |
$ — |
|||
Development-based |
— |
25,150 |
— |
33,358 |
|||
Total |
$ 1,301 |
$ 25,150 |
$ 1,717 |
$ 33,358 |
(3) |
Adjustments for amounts related to continuity and separation benefits, cost reductions and strategic review initiatives included the following (in thousands): |
|||||||
Three Months Ended |
|||||||
2021 |
2020 |
||||||
Cost of revenues |
Operating expenses |
Cost of revenues |
Operating expenses |
||||
Continuity and separation benefits |
$ (3,119) |
$ 13,100 |
$ 3,585 |
$ 7,451 |
|||
Accelerated depreciation |
1,715 |
672 |
5,039 |
2,744 |
|||
Other, including strategic review initiatives |
455 |
19,457 |
3,097 |
4,010 |
|||
Total |
$ (949) |
$ 33,229 |
$ 11,721 |
$ 14,205 |
|||
Year Ended |
|||||||
2021 |
2020 |
||||||
Cost of revenues |
Operating expenses |
Cost of revenues |
Operating expenses |
||||
Continuity and separation benefits |
$ (16,946) |
$ 25,760 |
$ 36,775 |
$ 50,132 |
|||
Accelerated depreciation |
19,037 |
5,680 |
15,567 |
6,892 |
|||
Other, including strategic review initiatives |
6,967 |
50,414 |
3,071 |
13,845 |
|||
Total |
$ 9,058 |
$ 81,854 |
$ 55,413 |
$ 70,869 |
The amounts in the tables above include adjustments related to previously announced restructuring activities, certain continuity and transitional compensation arrangements, certain other cost reduction initiatives and certain strategic review initiatives. |
|||||||
(4) |
To exclude adjustments to accruals for litigation-related settlement charges and certain settlement proceeds related to suits filed by subsidiaries. |
||||||
(5) |
To exclude opioid-related legal expenses. |
||||||
(6) |
Adjustments for asset impairment charges included the following (in thousands): |
||||||
Three Months Ended |
Year Ended |
||||||
2021 |
2020 |
2021 |
2020 |
||||
|
$ 363,000 |
$ — |
$ 363,000 |
$ 32,786 |
|||
Other intangible asset impairment charges |
— |
14,146 |
7,811 |
79,917 |
|||
Property, plant and equipment impairment charges |
1,584 |
1 |
2,011 |
1,249 |
|||
Operating lease right-of-use asset impairment charges |
— |
— |
— |
6,392 |
|||
Disposal group impairment charges |
— |
— |
42,155 |
— |
|||
Total |
$ 364,584 |
$ 14,147 |
$ 414,977 |
$ 120,344 |
(7) |
To exclude integration costs. |
||||||
(8) |
To exclude the impact of changes in the fair value of contingent consideration liabilities resulting from changes to estimates regarding the timing and amount of the future revenues of the underlying products and changes in other assumptions impacting the probability of incurring, and extent to which the Company could incur, related contingent obligations. |
||||||
(9) |
To exclude the loss on the extinguishment of debt associated with the Company's |
||||||
(10) |
The "Other" rows included in each of the above reconciliations of GAAP financial measures to non-GAAP financial measures (except for the reconciliations of Net (loss) income (GAAP) to Adjusted EBITDA (non-GAAP)) include the following (in thousands): |
||||||
Three Months Ended |
|||||||
2021 |
2020 |
||||||
Operating expenses |
Other non-operating expenses |
Operating expenses |
Other non-operating expenses |
||||
Foreign currency impact related to the re-measurement of intercompany debt instruments |
$ — |
$ 331 |
$ — |
$ 4,345 |
|||
Gain on sale of business and other assets |
— |
(5,085) |
— |
— |
|||
Other miscellaneous |
— |
(10,571) |
— |
(618) |
|||
Total |
$ — |
$ (15,325) |
$ — |
$ 3,727 |
|||
Year Ended |
|||||||
2021 |
2020 |
||||||
Operating expenses |
Other non-operating expenses |
Operating expenses |
Other non-operating expenses |
||||
Foreign currency impact related to the re-measurement of intercompany debt instruments |
$ — |
$ 797 |
$ — |
$ 1,919 |
|||
Gain on sale of business and other assets |
— |
(5,085) |
— |
(11,325) |
|||
Debt modification costs |
3,879 |
— |
31,118 |
— |
|||
Other miscellaneous |
— |
(15,461) |
— |
(4,548) |
|||
Total |
$ 3,879 |
$ (19,749) |
$ 31,118 |
$ (13,954) |
The 2021 amounts in the "Other miscellaneous" rows of the tables above primarily relate to gains associated with the termination of certain contracts. |
|||||||
The "Other" row included in the reconciliations of Net (loss) income (GAAP) to Adjusted EBITDA (non-GAAP) primarily relates to the items enumerated in the foregoing "Operating expenses" columns. |
|||||||
(11) |
Adjusted income taxes are calculated by tax effecting adjusted pre-tax income and permanent book-tax differences at the applicable effective tax rate that will be determined by reference to statutory tax rates in the relevant jurisdictions in which the Company operates. Adjusted income taxes include current and deferred income tax expense commensurate with the non-GAAP measure of profitability. |
||||||
(12) |
To exclude the results of the businesses reported as discontinued operations, net of tax. |
||||||
(13) |
Calculated as income or loss from continuing operations divided by the applicable weighted average share number. The applicable weighted average share numbers are as follows (in thousands): |
Three Months Ended |
Year Ended |
||||||
2021 |
2020 |
2021 |
2020 |
||||
GAAP |
233,681 |
234,474 |
232,785 |
233,653 |
|||
Non-GAAP Adjusted |
237,045 |
234,474 |
236,665 |
233,653 |
(14) |
Depreciation and amortization and Share-based compensation per the Adjusted EBITDA reconciliations do not include amounts reflected in other lines of the reconciliations, including Amounts related to continuity and separation benefits, cost reductions and strategic review initiatives. |
(15) |
To exclude Other (income) expense, net per the Consolidated Statements of Operations. |
Reconciliation of Net Debt Leverage Ratio (non-GAAP)
The following table provides a reconciliation of the Company's Net loss (GAAP) to Adjusted EBITDA (non-GAAP) for the twelve months ended
Twelve Months |
|
Net loss (GAAP) |
$ (613,245) |
Income tax expense |
22,478 |
Interest expense, net |
562,353 |
Depreciation and amortization (14) |
432,380 |
EBITDA (non-GAAP) |
$ 403,966 |
Upfront and milestone-related payments |
$ 26,451 |
Amounts related to continuity and separation benefits, cost reductions |
90,912 |
Certain litigation-related and other contingencies, net |
345,495 |
Certain legal costs |
136,148 |
Asset impairment charges |
414,977 |
Acquisition-related and integration costs |
414 |
Fair value of contingent consideration |
(8,793) |
Loss on extinguishment of debt |
13,753 |
Share-based compensation (14) |
29,227 |
Other income, net |
(19,774) |
Other |
3,882 |
Discontinued operations, net of tax |
44,164 |
Adjusted EBITDA (non-GAAP) |
$ 1,480,822 |
Calculation of Net Debt: |
|
Debt |
$ 8,249,322 |
Cash (excluding Restricted Cash) |
1,507,196 |
Net Debt (non-GAAP) |
$ 6,742,126 |
Calculation of Net Debt Leverage: |
|
Net Debt Leverage Ratio (non-GAAP) |
4.6 |
Non-GAAP Financial Measures
The Company utilizes certain financial measures that are not prescribed by or prepared in accordance with accounting principles generally accepted in the
Investors are encouraged to review the reconciliations of the non-GAAP financial measures used in this press release to their most directly comparable GAAP financial measures. However, the Company does not provide reconciliations of projected non-GAAP financial measures to GAAP financial measures, nor does it provide comparable projected GAAP financial measures for such projected non-GAAP financial measures. The Company is unable to provide such reconciliations without unreasonable efforts due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliations, including adjustments that could be made for asset impairments, contingent consideration adjustments, legal settlements, gain / loss on extinguishment of debt, adjustments to inventory and other charges reflected in the reconciliation of historic numbers, the amounts of which could be significant.
See Endo's Current Report on Form 8-K furnished today to the
About
Endo (NASDAQ: ENDP) is a specialty pharmaceutical company committed to helping everyone we serve live their best life through the delivery of quality, life-enhancing therapies. Our decades of proven success come from a global team of passionate employees collaborating to bring the best treatments forward. Together, we boldly transform insights into treatments benefiting those who need them, when they need them. Learn more at www.endo.com or connect with us on LinkedIn.
Cautionary Note Regarding Forward-Looking Statements
Certain information in this press release may be considered "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and any applicable Canadian securities legislation, including, but not limited to, the statements by
Additional information concerning risk factors, including those referenced above, can be found in press releases issued by Endo, as well as Endo's public periodic filings with the
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SOURCE
Media: Heather Zoumas-Lubeski, (484) 216-6829; Investors: Pravesh Khandelwal, (845) 364-4833