POTTERS BAR, England and PITTSBURGH, May 5, 2015 /PRNewswire/
-- Mylan N.V. (Nasdaq: MYL) today announced its financial
results for the quarter ended March 31, 2015.
Highlights
- Total revenues of $1.87 billion,
up 15% on a constant currency basis versus the prior year period.
Foreign currency exchange rates negatively impacted revenues in Q1
by $93 million.
- Generics segment third party net sales of $1.64 billion, up 15% on a constant currency
basis, with positive growth across all regions
- Specialty segment third party net sales of $211.1 million, up 8%
- Adjusted gross profit of $990.6
million, up 14%; GAAP gross profit of $830.1 million, up 13%
- Adjusted gross margin of 53%, up 240 basis points; GAAP gross
margin of 44%, up 140 basis points
- Adjusted diluted earnings per ordinary share ("EPS") of
$0.70, up 6%; GAAP diluted EPS of
$0.13, down 55% as a result of
acquisition costs from the acquisition of Abbott's non-U.S. developed markets specialty
and branded generics business ("EPD Business")
- Adjusted cash provided by operating activities of $336 million, up 17%; GAAP net cash provided by
operating activities of $267 million,
flat versus the prior year period
- Adjusted free cash flow of $288
million, up 35%
- Successfully completed the acquisition of the EPD Business
Mylan CEO Heather Bresch
commented, "Our solid first quarter results, which included
constant currency revenue growth of 15% and adjusted diluted EPS
growth of 6%, are in line with our expectations, marked a great
start to 2015 and again demonstrated our commitment to deliver
strong operational execution while making progress against our
short-term and long-term strategic objectives. During the quarter,
Mylan reported positive revenue growth across each of our business
segments and regions, with double digit constant currency revenue
growth in Europe and Rest of World
and high single digit revenue growth in North America and Specialty. We were excited
to complete our acquisition of the EPD Business and begin realizing
the significant value potential from this transaction. We continue
to remain confident in our outlook for the remainder of 2015, and
there is no change to our full year financial guidance. We also
remain committed to our target of at least $6.001 in adjusted diluted EPS in
2018.
"We remain steadfast in our legally-binding commitment to
acquire Perrigo and have taken numerous concrete steps to lay out a
clear and certain path towards completion. This is a transaction
consistent with our previous deals and our stated long-term
strategy. The combination brings clear and compelling industrial
logic, which will generate significant and long-term value for
customers, patients, employees, shareholders and other
stakeholders. This transaction brings together complementary
businesses and cultures, and results in a company with unmatched
scale in operations, one of the industry's broadest and most
diversified portfolios, and immense reach across distribution
channels around the world. With Perrigo, we have the opportunity to
create a one-of-a-kind global healthcare company that is positioned
to capitalize on key industry trends, including the growing number
of Rx to OTC switches underway, in order to redefine how healthcare
is delivered."
Mylan CFO John Sheehan added,
"Mylan's first quarter results lay the foundation for strong
financial and operational performance in 2015. As of the end of Q1,
our debt to EBITDA leverage was 2.1 times. Mylan continues to have
substantial financial firepower to execute on the right strategic
opportunities for our shareholders and stakeholders."
Total
Revenue
|
|
|
Three Months
Ended
|
|
March
31,
|
(Unaudited; in
millions)
|
2015
|
2014
|
Percent
Change
|
Total
Revenues
|
$
|
1,871.7
|
|
$
|
1,715.6
|
|
9%
|
Generics Third Party
Net Sales
|
1,643.5
|
|
1,508.3
|
|
9%
|
North
America
|
844.8
|
|
782.2
|
|
8%
|
Europe
|
406.2
|
|
355.9
|
|
14%
|
Rest of
World
|
392.5
|
|
370.2
|
|
6%
|
Specialty Third Party
Net Sales
|
211.1
|
|
194.7
|
|
8%
|
Other
Revenue
|
17.1
|
|
12.6
|
|
36%
|
Generics Segment Revenue
Generics segment third party net sales were
$1.64 billion for the quarter, an
increase of 9% when compared to the prior year period. When
translating third party net sales for the current quarter at prior
year comparative period exchange rates ("constant currency"), third
party net sales increased by 15%.
- Third party net sales from North
America were $844.8
million for the quarter, an increase of 8% when compared to
the prior year period. This increase was primarily driven by net
sales from new products and acquisition as well as favorable
pricing on existing products. The effect of foreign currency
translation on third party net sales was insignificant in
North America.
- Third party net sales from Europe were $406.2
million for the quarter, an increase of 14% when compared to
the prior year period. Constant currency third party net sales
increased by 33%. This increase was primarily driven by net sales
from the acquisition of the EPD Business. Further contributing to
this increase were higher volumes on existing products, primarily
in Italy and France, which were partially offset by lower
pricing throughout Europe.
- Third party net sales from Rest of World were
$392.5 million for the quarter, an
increase of 6% when compared to the prior year period. Constant
currency third party net sales increased by 12%. This increase was
primarily driven by net sales from acquisition, new product
launches in Australia and higher
sales volumes in India,
predominately from growth in our anti-retroviral ("ARV")
franchise.
Specialty Segment Revenue
Specialty segment reported third party net sales
of $211.1 million for the quarter, an
increase of 8% when compared to the prior year period. This
increase was primarily due to higher net sales of the EpiPen®
Auto-Injector driven by increased volume.
Total Gross Profit
Adjusted gross profit was $990.6
million and adjusted gross margins were 53% for the
quarter as compared to adjusted gross profit of $865.6 million and adjusted gross margins of 50%
in the comparable prior year period. The current quarter increase
was due to new product introductions and net sales from
acquisition. GAAP gross profit for the quarter was
$830.1 million and GAAP gross
margins were 44% as compared to GAAP gross profit of
$737.8 million and GAAP gross margins
of 43% in the comparable prior year period.
Total Profitability
Adjusted earnings from operations for the quarter were
$429.7 million, up 9% from the
comparable prior year period. R&D expense increased
primarily from the continued investment in our biologics and
respiratory growth programs. SG&A expense increased from
the prior year period as a result of increased costs related to
acquired businesses and increased selling and marketing costs,
primarily stemming from the EpiPen® Auto-Injector
direct-to-consumer marketing campaign. GAAP earnings from
operations were $159.3 million
for the quarter, a decrease of 33% from the comparable prior year
period. This decrease in earnings from operations during the
current quarter was primarily the result of increased acquisition
related costs and increased amortization expense as a result of the
acquisition of the EPD Business.
EBITDA, which is defined as net earnings (excluding the
non-controlling interest and losses from equity method investees)
plus income taxes, interest expense, depreciation and amortization,
was $340.5 million for the quarter
and $392.4 million for the comparable
prior year quarter. After adjusting for certain items as further
detailed in the reconciliation below, adjusted EBITDA was
$504.6 million for the quarter and
$459.7 million for the comparable
prior year period. Adjusted net earnings attributable to Mylan
N.V. increased by $48.7 million
to $309.1 million compared to
$260.4 million for the prior year
comparable period. Adjusted diluted EPS increased 6% to
$0.70 compared
to $0.66 in the prior year comparable period. GAAP net
earnings attributable to Mylan N.V. decreased by
$59.3 million to $56.6 million as compared to $115.9 million for the prior year comparable
period. GAAP diluted EPS decreased 55% to $0.13 compared to $0.29 in the prior year comparable period.
Cash Flow
Adjusted cash provided by operating activities was
$336 million for the three months
ended March 31, 2015, compared to
$286 million for the comparable prior
year period. On a GAAP basis, net cash provided by
operating activities was $267
million for the three months ended March 31, 2015, compared to $268 million for the comparable prior year
period. Capital expenditures were approximately $48 million for the three months ended
March 31, 2015 as compared to
approximately $72 million for the
year ended March 31, 2014. Adjusted free cash flow was
$288 million for the three months
ended March 31, 2015, compared to
$214 million in the prior year
period.
Conference Call
Mylan will host a conference call and live webcast, today,
May 5, 2015, at 4:30 p.m. ET, in
conjunction with the release of its financial results. The dial-in
number to access the call is 800.514.4861 or 678.809.2405 for
international callers. To access the live webcast please log onto
Mylan's website (www.mylan.com) at least 15 minutes before the
event is to begin to register and download or install any necessary
software. A replay of the webcast will be available at
www.mylan.com for a limited time.
Non-GAAP Financial Measures
This press release includes the presentation and discussion of
certain financial information that differs from what is reported
under accounting principles generally accepted in the United States ("GAAP"). These non-GAAP
financial measures, including, but not limited to, adjusted diluted
EPS, adjusted cash provided by operating activities, adjusted gross
profit, adjusted gross margins, adjusted earnings from operations,
adjusted net earnings attributable to Mylan N.V., constant currency
total revenue, constant currency third party net sales, EBITDA,
adjusted EBITDA, debt to EBITDA leverage, and adjusted free cash
flow, are presented in order to supplement investors' and other
readers' understanding and assessment of the Company's financial
performance. Management uses these measures internally for
forecasting, budgeting and measuring its operating performance. In
addition, primarily due to acquisitions, Mylan believes that an
evaluation of its ongoing operations (and comparisons of its
current operations with historical and future operations) would be
difficult if the disclosure of its financial results were limited
to financial measures prepared only in accordance with GAAP. In
addition, the Company believes that including EBITDA and
supplemental adjustments applied in presenting adjusted EBITDA
pursuant to our credit agreement is appropriate to provide
additional information to investors to demonstrate the Company's
ability to comply with financial debt covenants (which are
calculated using a measure similar to adjusted EBITDA) and assess
the Company's ability to incur additional indebtedness. We also
report sales performance using the non-GAAP financial measure of
"constant currency" total revenues and third party net sales. This
measure provides information on the change in net sales assuming
that foreign currency exchange rates had not changed between the
prior and current period. The comparisons presented as constant
currency rates reflect comparative local currency sales at the
prior year's foreign exchange rates. We routinely evaluate our
third party net sales performance at constant currency so that
sales results can be viewed without the impact of foreign currency
exchange rates, thereby facilitating a period-to-period comparison
of our operational activities, and believe that this presentation
also provides useful information to investors for the same reason.
The "Summary of Revenues by Segment" table below compares third
party net sales on an actual and constant currency basis for each
reportable segment and the geographic regions within the Generics
segment for the three months ended March 31,
2015 and 2014. Also, set forth below, Mylan has provided
reconciliations of such non-GAAP financial measures to the most
directly comparable GAAP financial measures. Investors and other
readers are encouraged to review the related GAAP financial
measures and the reconciliations of the non-GAAP measures to their
most directly comparable GAAP measures set forth below, and
investors and other readers should consider non-GAAP measures only
as supplements to, not as substitutes for or as superior measures
to, the measures of financial performance prepared in accordance
with GAAP.
Below is a reconciliation of GAAP net earnings attributable to
Mylan N.V. and GAAP diluted EPS to adjusted net earnings
attributable to Mylan N.V. and adjusted diluted EPS for the three
months ended March 31, 2015 compared
to the respective prior year period (in millions, except per share
amounts):
|
Three Months Ended
March 31,
|
|
2015
|
|
2014
|
GAAP net earnings
attributable to Mylan N.V. and GAAP diluted EPS
|
$
|
56.6
|
|
$
|
0.13
|
|
|
$
|
115.9
|
|
$
|
0.29
|
|
Purchase accounting
related amortization (primarily included in cost of
sales)
|
144.0
|
|
|
|
103.7
|
|
|
Litigation
settlements, net
|
17.7
|
|
|
|
3.1
|
|
|
Interest expense,
primarily amortization of convertible debt discount
|
12.2
|
|
|
|
10.9
|
|
|
Non-cash accretion
and fair value adjustments of contingent consideration
liability
|
9.2
|
|
|
|
8.4
|
|
|
Clean energy
investments pre-tax loss (a)
|
22.5
|
|
|
|
19.4
|
|
|
Acquisition related
costs (primarily included in cost of sales and selling, general and
administrative expense)
|
78.8
|
|
|
|
23.4
|
|
|
Restructuring and other special items included
in:
|
|
|
|
|
|
Cost of
sales
|
8.0
|
|
|
|
10.3
|
|
|
Research and
development expense
|
17.9
|
|
|
|
0.9
|
|
|
Selling, general and
administrative expense
|
7.8
|
|
|
|
19.4
|
|
|
Other income
(expense), net
|
7.0
|
|
|
|
(3.0)
|
|
|
Tax effect of the
above items and other income tax related items
|
(72.6)
|
|
|
|
(52.0)
|
|
|
Adjusted net earnings
attributable to Mylan N.V. and adjusted diluted EPS
|
$
|
309.1
|
|
$
|
0.70
|
|
|
$
|
260.4
|
|
$
|
0.66
|
|
Weighted average
diluted ordinary shares outstanding
|
443.8
|
|
|
|
396.7
|
|
|
|
|
|
|
|
|
|
|
(a) Adjustment
represents exclusion of the pre-tax loss related to Mylan's clean
energy investments, the activities of which qualify for income tax
credits under Section 45 of the Code. The amount is included in
other expense (income), net in the Condensed Consolidated
Statements of Operations.
|
Below is a reconciliation of GAAP net earnings attributable to
Mylan N.V. to EBITDA and adjusted EBITDA for the three months ended
March 31, 2015 compared to the
respective prior year period (in millions):
|
Three Months
Ended
|
|
March
31,
|
|
2015
|
|
2014
|
GAAP net earnings
attributable to Mylan N.V.
|
$
|
56.6
|
|
|
$
|
115.9
|
|
Add
adjustments:
|
|
|
|
Net contribution
attributable to the noncontrolling interest and equity method
investments
|
24.7
|
|
|
23.5
|
|
Income
taxes
|
4.7
|
|
|
35.1
|
|
Interest
expense
|
79.5
|
|
|
82.7
|
|
Depreciation and
amortization
|
175.0
|
|
|
135.2
|
|
EBITDA
|
$
|
340.5
|
|
|
$
|
392.4
|
|
Add
adjustments:
|
|
|
|
Share-based
compensation expense
|
19.2
|
|
|
15.4
|
|
Litigation
settlements, net
|
17.7
|
|
|
3.1
|
|
Restructuring & other special
items
|
127.2
|
|
|
48.8
|
|
Adjusted
EBITDA
|
$
|
504.6
|
|
|
$
|
459.7
|
|
About Mylan
Mylan is a global pharmaceutical company committed to setting
new standards in health care. Working together around the world to
provide 7 billion people access to high quality medicine, we
innovate to satisfy unmet needs; make reliability and service
excellence a habit; do what's right, not what's easy; and impact
the future through passionate global leadership. We offer a growing
portfolio of around 1,400 generic pharmaceuticals and several brand
medications. In addition, we offer a wide range of antiretroviral
therapies, upon which approximately 40% of HIV/AIDS patients in
developing countries depend. We also operate one of the largest
active pharmaceutical ingredient manufacturers and currently market
products in about 145 countries and territories. Our workforce
includes approximately 30,000 people dedicated to improving the
customer experience and increasing pharmaceutical access to
consumers around the world. But don't take our word for it. See for
yourself. See inside. mylan.com
Responsibility Statement
The directors of Mylan accept responsibility for the information
contained in this announcement. To the best of the knowledge and
belief of the directors (who have taken all reasonable care to
ensure that such is the case) the information contained in this
announcement is in accordance with the facts and does not omit
anything likely to affect the import of such information.
Dealing Disclosure Requirements
Under the provisions of Rule 8.3 of the Irish Takeover Panel
Act, 1997, Takeover Rules 2013 (the "Irish Takeover Rules"), if any
person is, or becomes, 'interested' (directly or indirectly) in, 1%
or more of any class of 'relevant securities' of Perrigo Company
plc ("Perrigo") or Mylan, all 'dealings' in any 'relevant
securities' of Perrigo or Mylan (including by means of an option in
respect of, or a derivative referenced to, any such 'relevant
securities') must be publicly disclosed by not later than
3:30 pm (New York time) on the 'business' day following
the date of the relevant transaction. This requirement will
continue until the date on which the 'offer period' ends. If two or
more persons co-operate on the basis of any agreement, either
express or tacit, either oral or written, to acquire an 'interest'
in 'relevant securities' of Perrigo or Mylan, they will be deemed
to be a single person for the purpose of Rule 8.3 of the Irish
Takeover Rules.
Under the provisions of Rule 8.1 of the Irish Takeover Rules,
all 'dealings' in 'relevant securities' of Perrigo by Mylan or
'relevant securities' of Mylan by Perrigo, or by any party acting
in concert with either of them, must also be disclosed by no later
than 12 noon (New York time) on
the 'business' day following the date of the relevant
transaction.
A disclosure table, giving details of the companies in whose
'relevant securities' 'dealings' should be disclosed, can be found
on the Irish Takeover Panel's website at
www.irishtakeoverpanel.ie.
Interests in securities arise, in summary, when a person has
long economic exposure, whether conditional or absolute, to changes
in the price of securities. In particular, a person will be treated
as having an 'interest' by virtue of the ownership or control of
securities, or by virtue of any option in respect of, or derivative
referenced to, securities.
Terms in quotation marks are defined in the Irish Takeover
Rules, which can also be found on the Irish Takeover Panel's
website. If you are in any doubt as to whether or not you are
required to disclose a dealing under Rule 8, please consult the
Irish Takeover Panel's website at www.irishtakeoverpanel.ie or
contact the Irish Takeover Panel on telephone number +353 1 678
9020 or fax number +353 1 678 9289.
Goldman Sachs, which is authorized by the Prudential Regulation
Authority and regulated by the Financial Conduct Authority and the
Prudential Regulation Authority in the United Kingdom, is acting for Mylan and no one
else in connection with Mylan's proposed acquisition of Perrigo
(the "Perrigo Proposal") and will not be responsible to anyone
other than Mylan for providing the protections afforded to clients
of Goldman Sachs, or for giving advice in connection with the
Perrigo Proposal or any matter referred to herein.
Goldman Sachs does not accept any responsibility whatsoever for
the contents of this communication or for any statement made or
purported to be made by them or on their behalf in connection with
the offer. Goldman Sachs accordingly disclaims all and any
liability whether arising in tort, contract or otherwise which it
might otherwise have in respect of this communication or any such
statement.
Forward-Looking Statements
This press release contains "forward-looking statements." These
statements are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. Such
forward-looking statements may include, without limitation,
statements about the Perrigo Proposal, Mylan's acquisition (the
"Abbott Transaction") of Mylan Inc. and the EPD Business, the
benefits and synergies of the Perrigo Proposal or Abbott
Transaction, future opportunities for Mylan, Perrigo, or the
combined company and products, and any other statements regarding
Mylan's, Perrigo's, or the combined company's future operations,
anticipated business levels, future earnings, planned activities,
anticipated growth, market opportunities, strategies, competition,
and other expectations and targets for future periods.
These may often be identified by the use of words such as
"will," "may," "could," "should," "would," "project," "believe,"
"anticipate," "expect," "plan," "estimate," "forecast,"
"potential," "intend," "continue," "target" and variations of these
words or comparable words. Because forward-looking statements
inherently involve risks and uncertainties, actual future results
may differ materially from those expressed or implied by such
forward-looking statements. Factors that could cause or contribute
to such differences include, but are not limited to: uncertainties
related to the Perrigo Proposal, including as to the timing of the
offer and compulsory acquisition, whether Perrigo will cooperate
with Mylan and whether Mylan will be able to consummate the offer
and compulsory acquisition, whether Mylan shareholders will provide
the requisite approvals for the Perrigo Proposal, the possibility
that competing offers will be made, the possibility that the
conditions to the consummation of the offer will not be satisfied,
and the possibility that Mylan will be unable to obtain regulatory
approvals for the offer and compulsory acquisition or be required,
as a condition to obtaining regulatory approvals, to accept
conditions that could reduce the anticipated benefits of the offer
and compulsory acquisition; the ability to meet expectations
regarding the accounting and tax treatments of a transaction
relating to the Perrigo Proposal and the Abbott Transaction;
changes in relevant tax and other laws, including but not limited
to changes in healthcare and pharmaceutical laws and regulations in
the U.S. and abroad; the integration of Perrigo and the EPD
Business being more difficult, time-consuming, or costly than
expected; operating costs, customer loss and business disruption
(including, without limitation, difficulties in maintaining
relationships with employees, customers, clients, or suppliers)
being greater than expected following the Perrigo Proposal and the
Abbott Transaction; the retention of certain key employees of
Perrigo and the EPD Business being difficult; the possibility that
Mylan may be unable to achieve expected synergies and operating
efficiencies in connection with the Perrigo Proposal and the Abbott
Transaction within the expected time-frames or at all and to
successfully integrate Perrigo and the EPD Business; expected or
targeted future financial and operating performance and results;
challenges to our business and strategic plans posed by the recent
unsolicited business proposal made by a large competitor to acquire
all of our outstanding shares; the capacity to bring new products
to market, including but not limited to where Mylan uses its
business judgment and decides to manufacture, market, and/or sell
products, directly or through third parties, notwithstanding the
fact that allegations of patent infringement(s) have not been
finally resolved by the courts (i.e., an "at-risk launch"); success
of clinical trials and our ability to execute on new product
opportunities; the scope, timing, and outcome of any ongoing legal
proceedings and the impact of any such proceedings on financial
condition, results of operations and/or cash flows; the ability to
protect intellectual property and preserve intellectual property
rights; the effect of any changes in customer and supplier
relationships and customer purchasing patterns; the ability to
attract and retain key personnel; changes in third-party
relationships; the impact of competition; changes in the economic
and financial conditions of the businesses of Mylan, Perrigo, or
the combined company; the inherent challenges, risks, and costs in
identifying, acquiring, and integrating complementary or strategic
acquisitions of other companies, products or assets and in
achieving anticipated synergies; uncertainties and matters beyond
the control of management; and inherent uncertainties involved in
the estimates and judgments used in the preparation of financial
statements, and the providing of estimates of financial measures,
in accordance with GAAP and related standards or on an adjusted
basis.
For more detailed information on the risks and uncertainties
associated with the Company's business activities, see the risks
described in Mylan Inc.'s Annual Report on Form 10-K for the year
ended December 31, 2014 and our other filings with the
Securities and Exchange Commission ("SEC"). These risks, as well as
other risks associated with the Company, Perrigo, and the combined
company are also more fully discussed in the Registration Statement
on Form S-4 and the proxy statement that Mylan anticipates filing
with the SEC on May 5, 2015 in
connection with the Perrigo Proposal. You can access Mylan's
filings with the SEC through the SEC website at www.sec.gov, and
the Company strongly encourages you to do so. The Company
undertakes no obligation to update any statements herein for
revisions or changes after the date of this release. Long-term
targets, including, but not limited to, 2018 targets, do not
represent Company guidance.
Additional Information
In connection with Mylan's offer to acquire Perrigo (the
"offer"), Mylan anticipates filing certain materials with the SEC,
including, among other materials, a Registration Statement on Form
S-4 (that includes an offer to exchange/prospectus) on May 5, 2015 (which Registration Statement has not
yet been declared effective) and a preliminary proxy statement on
Schedule 14A on May 5, 2015. In
connection with the offer, Mylan intends to file with the SEC a
Tender Offer Statement on Schedule TO and certain other
materials. This communication is not intended to be, and is
not, a substitute for such filings or for any other document that
Mylan may file with the SEC in connection with the offer. INVESTORS
AND SECURITYHOLDERS OF MYLAN AND PERRIGO ARE URGED TO READ THE
DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY (IF
AND WHEN THEY BECOME AVAILABLE) BEFORE MAKING AN INVESTMENT
DECISION BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT
MYLAN, PERRIGO AND THE OFFER. Such documents will be available free
of charge through the website maintained by the SEC at www.sec.gov
or by directing a request to Mylan at 724-514-1813 or
investor.relations@mylan.com. Any materials filed by Mylan with the
SEC that are required to be mailed to shareholders of Perrigo
and/or Mylan will also be mailed to such shareholders. This
communication has been prepared in accordance with U.S. securities
law, Irish law and the Irish Takeover Rules.
A copy of this communication will be available free of charge at
the following website: perrigotransaction.mylan.com. Such website
is neither endorsed, nor sponsored, nor affiliated with Perrigo or
any of its affiliates. PERRIGO® is a registered trademark of L.
Perrigo Company.
Participants in Solicitation
This communication is not a solicitation of a proxy from any
investor or shareholder. However, Mylan and certain of its
directors, executive officers and other members of its management
and employees may be deemed to be participants in the solicitation
of proxies in connection with the offer under the rules of the SEC.
Information regarding Mylan's directors and executive officers may
be found in the Mylan proxy statement/prospectus on Form S-4 filed
with the SEC on December 23, 2014 and
Mylan Inc.'s Annual Report on Form 10-K for the fiscal year ended
December 31, 2014, which was filed
with the SEC on March 2, 2015 and
amended on April 30, 2015. These
documents can be obtained free of charge from the sources indicated
above. Additional information regarding the interests of these
participants, which may, in some cases, be different than those of
Mylan's shareholders generally, will also be included in the
materials that Mylan intends to file with the SEC when they become
available.
Non-Solicitation
This communication is not intended to, and does not, constitute
or form part of (1) any offer or invitation to purchase or
otherwise acquire, subscribe for, tender, exchange, sell or
otherwise dispose of any securities, (2) the solicitation of an
offer or invitation to purchase or otherwise acquire, subscribe
for, sell or otherwise dispose of any securities or (3) the
solicitation of any vote or approval in any jurisdiction pursuant
to this communication or otherwise, nor will there be any
acquisition or disposition of the securities referred to in this
communication in any jurisdiction in contravention of applicable
law or regulation. No offer of securities shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended.
Further Information
The distribution of this communication in certain jurisdictions
may be restricted or affected by the laws of such jurisdictions.
Accordingly, copies of this communication are not being, and must
not be, mailed or otherwise forwarded, distributed or sent in,
into, or from any such jurisdiction. Therefore, persons who receive
this communication (including, without limitation, nominees,
trustees and custodians) and are subject to the laws of any such
jurisdiction will need to inform themselves about, and observe, any
applicable restrictions or requirements. Any failure to do so may
constitute a violation of the securities laws of any such
jurisdiction. To the fullest extent permitted by applicable law,
Mylan disclaims any responsibility or liability for the violations
of any such restrictions by any person.
Profit Forecast
To the extent that the Mylan quarterly results and/or the
calendar year 2015 guidance contained, referred to or summarized in
this document constitutes a profit forecast for the purposes of
Rule 28 of the Irish Takeover Panel Act, Takeover Rules, 2013, such
results and/or guidance will (unless the Irish Takeover Panel
consents otherwise) be reported on in accordance with that rule at
the appropriate time. Except as described in the previous sentence,
no statement in this announcement is intended to constitute a
profit forecast for any period, nor should any statements be
interpreted to mean that earnings or earnings per share will
necessarily be greater or lesser than those for the relevant
preceding financial periods for Mylan or Perrigo as appropriate. No
statement in this communication constitutes an asset valuation.
(1) This figure is a target only. It is not intended
to constitute a profit forecast under the Irish Takeover Rules.
Mylan N.V. and
Subsidiaries
Condensed
Consolidated Statements of Operations
(Unaudited; in
millions, except per share amounts)
|
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2015
|
|
2014
|
Revenues:
|
|
|
|
Net sales
|
$
|
1,854.6
|
|
|
$
|
1,703.0
|
|
Other
revenues
|
17.1
|
|
|
12.6
|
|
Total
revenues
|
1,871.7
|
|
|
1,715.6
|
|
Cost of
sales
|
1,041.6
|
|
|
977.8
|
|
Gross
profit
|
830.1
|
|
|
737.8
|
|
Operating
expenses:
|
|
|
|
Research and
development
|
169.9
|
|
|
118.0
|
|
Selling, general and
administrative
|
483.2
|
|
|
377.7
|
|
Litigation
settlements, net
|
17.7
|
|
|
3.1
|
|
Total operating
expenses
|
670.8
|
|
|
498.8
|
|
Earnings from
operations
|
159.3
|
|
|
239.0
|
|
Interest
expense
|
79.5
|
|
|
82.7
|
|
Other expense
(income), net
|
18.5
|
|
|
4.6
|
|
Earnings before
income taxes and noncontrolling interest
|
61.3
|
|
|
151.7
|
|
Income tax
provision
|
4.7
|
|
|
35.1
|
|
Net
earnings
|
56.6
|
|
|
116.6
|
|
Net earnings
attributable to the noncontrolling interest
|
—
|
|
|
(0.7)
|
|
Net earnings
attributable to Mylan N.V. ordinary shareholders
|
$
|
56.6
|
|
|
$
|
115.9
|
|
Earnings per ordinary
share attributable to Mylan N.V. ordinary shareholders:
|
|
|
|
Basic
|
$
|
0.14
|
|
|
$
|
0.31
|
|
Diluted
|
$
|
0.13
|
|
|
$
|
0.29
|
|
Weighted average
ordinary shares outstanding:
|
|
|
|
Basic
|
418.0
|
|
|
372.3
|
|
Diluted
|
443.8
|
|
|
396.7
|
|
Mylan N.V. and
Subsidiaries
Condensed
Consolidated Balance Sheets
(Unaudited; in
millions)
|
|
|
|
|
|
March 31,
2015
|
|
December 31,
2014
|
ASSETS
|
|
|
|
|
|
|
|
Assets
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
|
277.2
|
|
|
$
|
225.5
|
|
Accounts receivable,
net
|
2,264.6
|
|
|
2,268.5
|
|
Inventories
|
1,908.3
|
|
|
1,651.4
|
|
Other current
assets
|
2,976.3
|
|
|
2,641.5
|
|
Total current
assets
|
7,426.4
|
|
|
6,786.9
|
|
Intangible assets,
net
|
6,770.6
|
|
|
2,347.1
|
|
Goodwill
|
5,115.8
|
|
|
4,049.3
|
|
Other non-current
assets
|
2,811.0
|
|
|
2,703.3
|
|
Total
assets
|
$
|
22,123.8
|
|
|
$
|
15,886.6
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
Current
liabilities
|
$
|
5,288.0
|
|
|
$
|
5,305.7
|
|
Long-term
debt
|
5,750.4
|
|
|
5,732.8
|
|
Other non-current
liabilities
|
1,992.2
|
|
|
1,572.1
|
|
Total
liabilities
|
13,030.6
|
|
|
12,610.6
|
|
Noncontrolling
interest
|
19.9
|
|
|
20.1
|
|
Mylan N.V.
shareholders' equity
|
9,073.3
|
|
|
3,255.9
|
|
Total liabilities and
equity
|
$
|
22,123.8
|
|
|
$
|
15,886.6
|
|
Mylan N.V. and
Subsidiaries
Summary of
Revenues by Segment
(Unaudited; in
millions)
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
March
31,
|
|
Percent
Change
|
|
2015
|
|
2014
|
|
Actual
|
|
Constant
Currency(1)
|
|
|
|
|
|
|
|
|
Generics:
|
|
|
|
|
|
|
|
Third party net
sales
|
|
|
|
|
|
|
|
North
America
|
$
|
844.8
|
|
|
$
|
782.2
|
|
|
8
|
%
|
|
8
|
%
|
Europe
|
406.2
|
|
|
355.9
|
|
|
14
|
%
|
|
33
|
%
|
Rest of
World
|
392.5
|
|
|
370.2
|
|
|
6
|
%
|
|
12
|
%
|
Total third party net
sales
|
1,643.5
|
|
|
1,508.3
|
|
|
9
|
%
|
|
15
|
%
|
|
|
|
|
|
|
|
|
Other third party
revenues
|
11.6
|
|
|
6.2
|
|
|
|
|
|
Total third party
revenues
|
1,655.1
|
|
|
1,514.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intersegment
sales
|
1.5
|
|
|
1.3
|
|
|
|
|
|
Generics total
revenues
|
1,656.6
|
|
|
1,515.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Specialty:
|
|
|
|
|
|
|
|
Third party net
sales
|
211.1
|
|
|
194.7
|
|
|
8
|
%
|
|
8
|
%
|
Other third party
revenues
|
5.5
|
|
|
6.4
|
|
|
|
|
|
Total third party
revenues
|
216.6
|
|
|
201.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intersegment
sales
|
2.0
|
|
|
1.7
|
|
|
|
|
|
Specialty total
revenues
|
218.6
|
|
|
202.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Elimination of
intersegment sales
|
(3.5)
|
|
|
(3.0)
|
|
|
|
|
|
Consolidated total
revenues
|
$
|
1,871.7
|
|
|
$
|
1,715.6
|
|
|
9
|
%
|
|
15
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The
constant currency percent change is derived by translating third
party net sales for the current period at prior year comparative
period exchange rates.
|
Mylan N.V. and
Subsidiaries
Reconciliation of
Non-GAAP Financial Measures
(Unaudited; in
millions)
|
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2015
|
|
2014
|
GAAP cost of
sales
|
$
|
1,041.6
|
|
|
$
|
977.8
|
|
Deduct:
|
|
|
|
Purchase accounting
related amortization
|
(140.2)
|
|
|
(99.9)
|
|
Acquisition related
costs
|
(12.3)
|
|
|
(17.6)
|
|
Restructuring &
other special items
|
(8.0)
|
|
|
(10.3)
|
|
Adjusted cost of
sales
|
$
|
881.1
|
|
|
$
|
850.0
|
|
|
|
|
|
Adjusted gross profit
(a)
|
$
|
990.6
|
|
|
$
|
865.6
|
|
|
|
|
|
Adjusted gross margin
(a)
|
53
|
%
|
|
50
|
%
|
|
Three Months
Ended
|
|
March
31,
|
|
2015
|
|
2014
|
GAAP
R&D
|
$
|
169.9
|
|
|
$
|
118.0
|
|
Deduct:
|
|
|
|
Restructuring &
other special items
|
(17.9)
|
|
|
(0.9)
|
|
Adjusted
R&D
|
$
|
152.0
|
|
|
$
|
117.1
|
|
|
|
|
|
Adjusted R&D as %
of total revenue
|
8.1
|
%
|
|
6.8
|
%
|
|
Three Months
Ended
|
|
March
31,
|
|
2015
|
|
2014
|
GAAP
SG&A
|
$
|
483.2
|
|
|
$
|
377.7
|
|
Deduct:
|
|
|
|
Acquisition related
costs
|
(66.5)
|
|
|
(5.8)
|
|
Restructuring &
other special items
|
(7.8)
|
|
|
(19.4)
|
|
Adjusted
SG&A
|
$
|
408.9
|
|
|
$
|
352.5
|
|
|
|
|
|
Adjusted SG&A as
% of total revenue
|
21.8
|
%
|
|
20.5
|
%
|
|
Three Months
Ended
|
|
March
31,
|
|
2015
|
|
2014
|
GAAP total
operating expenses
|
$
|
670.8
|
|
|
$
|
498.8
|
|
Deduct:
|
|
|
|
Litigation
settlements, net
|
(17.7)
|
|
|
(3.1)
|
|
Acquisition related
costs
|
(66.5)
|
|
|
(5.8)
|
|
Restructuring &
other special items
|
(25.7)
|
|
|
(20.3)
|
|
Adjusted total
operating expenses
|
$
|
560.9
|
|
|
$
|
469.6
|
|
|
|
|
|
Adjusted earnings
from operations (b)
|
$
|
429.7
|
|
|
$
|
396.0
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2015
|
|
2014
|
GAAP interest
expense
|
$
79.5
|
|
$
82.7
|
Deduct:
|
|
|
|
Interest
expense related to clean energy investments (c)
|
(4.3)
|
|
(3.9)
|
Non-cash
accretion of contingent consideration liability
|
(9.2)
|
|
(8.4)
|
Non-cash
interest, primarily amortization of convertible debt
discount
|
(7.9)
|
|
(7.0)
|
Adjusted interest
expense
|
$
58.1
|
|
$
63.4
|
|
|
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2015
|
|
2014
|
GAAP other
expense, net
|
$
18.5
|
|
$
4.6
|
(Deduct) /
Add:
|
|
|
|
Equity method
losses from clean energy investments
|
(22.5)
|
|
(19.4)
|
Purchase
accounting related amortization
|
(3.8)
|
|
(3.8)
|
Restructuring
& other special items
|
(7.0)
|
|
3.0
|
Adjusted other
income
|
$
(14.8)
|
|
$
(15.6)
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
2015
|
|
2014
|
GAAP net cash
provided by operating activities
|
$
267
|
|
$
268
|
Add:
|
|
|
|
Acquisition
related costs
|
68
|
|
14
|
R&D
expense
|
—
|
|
4
|
Other
|
1
|
|
—
|
Adjusted cash
provided by operating activities
|
$
336
|
|
$
286
|
|
|
|
|
Deduct:
|
|
|
|
Capital
expenditures
|
(48)
|
|
(72)
|
Adjusted free cash
flow
|
$
288
|
|
$
214
|
(a) Adjusted gross profit is calculated as
total revenues less adjusted cost of sales. Adjusted gross margin
is calculated as adjusted gross profit divided by total
revenue.
|
|
(b) Adjusted earnings from operations is
calculated as adjusted gross profit less adjusted total operating
expenses.
|
|
(c) Adjustment represents exclusion of
activity related to Mylan's clean energy investments, the
activities of which qualify for income tax credits under section 45
of the U.S. Internal Revenue Code.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/mylan-first-quarter-2015-constant-currency-revenue-increases-15-and-adjusted-diluted-eps-increases-6-to-070-300078025.html
SOURCE Mylan N.V.