‒ Q1 2022 Net Revenue of $498 million; GAAP Net
Loss of $2 million; Diluted Loss per Share of $(0.01) ‒
‒ Adjusted EBITDA (1) of $100 million includes
$5 million of R&D milestone expense; Adjusted Diluted EPS (1)
of $0.12 ‒
‒ Maintaining 2022 Full Year Outlook ‒
Amneal Pharmaceuticals, Inc. (NYSE: AMRX) (“Amneal” or
the “Company”) announced its results today for the first quarter
ended March 31, 2022.
“We are very pleased with our first quarter results and the
progress we have made to advance our growth strategy. With recent
U.S. FDA approvals for our first two biosimilars, as well as the
closing of our Saol Baclofen acquisition, Amneal is expanding in
high growth areas, including biosimilars and injectables, which we
expect to drive meaningful growth going forward. These important
milestones, as well as our continued focus on advancing R&D
initiatives, are diversifying our business as we work to fulfill
our mission of bringing innovative and affordable medicines to
patients and creating value for shareholders,” said Chirag and
Chintu Patel, Co-Chief Executive Officers.
Net revenue in the first quarter of 2022 was $498 million, an
increase of 1% compared to $493 million in the first quarter of
2021. The increase was driven by solid broad-based performance in
Generics, including new product launches, and the expansion of
AvKARE’s distribution channel, partially offset by the loss of
exclusivity of Zomig® Nasal Spray.
Net loss attributable to Amneal Pharmaceuticals, Inc. was $2
million in the first quarter of 2022 compared to a net income of $7
million in the first quarter of 2021. Beginning in the first
quarter of 2022, we will no longer exclude research and development
milestone expenses from non-GAAP financial measures. In the first
quarter of 2022 and 2021, R&D milestone expenses were $5
million and $11 million, respectively. Prior periods presented have
been revised to reflect this change. Adjusted EBITDA(1) in the
first quarter of 2022 was $100 million, a decrease of 13% compared
to the first quarter of 2021, reflective of lower gross profit due
to product mix and a tough comparison to the prior year. Adjusted
diluted EPS(1) in the first quarter of 2022 was $0.12, compared to
$0.17 in the first quarter of 2021.
(1) See “Non-GAAP Financial Measures” below.
Maintaining Full Year 2022 Financial Outlook
Amneal is maintaining its previously provided guidance.
Full
Year 2022 Financial Guidance
Net revenue
$2.15 billion - $2.25 billion
Adjusted EBITDA (1)
$540 million - $560 million
Adjusted diluted EPS (2)
$0.80 - $0.85
Operating cash flow (3)
$225 million - $250 million
Capital expenditures
$75 million - $85 million
Weighted average diluted shares
outstanding (4)
Approximately 307 million
(1)
Includes 100% of EBITDA from the
AvKARE acquisition. Beginning in the first quarter of 2022, we will
no longer exclude research and development milestone expense from
non-GAAP financial measures.
(2)
Accounts for 35% non-controlling
interest in AvKARE. Beginning in the first quarter of 2022, we will
no longer exclude research and development milestone expense from
non-GAAP financial measures.
(3)
Represents cash provided by
operating activities. Guidance does not contemplate one time and
non-recurring items such as legal settlements and other discrete
items.
(4)
Assumes the weighted average
diluted shares outstanding of class A and class B common stock
under the if-converted method.
Amneal’s 2022 estimates are based on management's current
expectations, including with respect to prescription trends,
pricing levels, the timing of future product launches, the costs
incurred and benefits realized of restructuring activities, and our
long-term strategy. The Company’s financial statements are prepared
in accordance with accounting principles generally accepted in the
United States of America (“GAAP”). The Company cannot provide a
reconciliation between non-GAAP projections and the most directly
comparable measures in accordance with GAAP without unreasonable
efforts because it is unable to predict with reasonable certainty
the ultimate outcome of certain significant items required for the
reconciliation. The items include, but are not limited to,
acquisition-related expenses, restructuring expenses and benefits,
asset impairments and other gains and losses. These items are
uncertain, depend on various factors, and could have a material
impact on GAAP reported results.
Conference Call Information
Amneal will host a conference call and live webcast at 8:30 am
Eastern Time on May 4, 2022 to discuss its results. The live
webcast and presentation will be accessible through the Investor
Relations section of the Company’s website at
https://investors.amneal.com. To access the call through a
conference line, dial (844) 200-6205 (in the U.S.) or (929)
526-1599 (international callers). The access code for the call is
874223. A replay of the conference call will be posted shortly
after the call and will be available for seven days. To access the
replay, dial (866) 813-9403 (in the U.S.) or +44 (204) 525-0658
(international callers). The access code for the replay is
097886.
About Amneal
Amneal Pharmaceuticals, Inc. (NYSE: AMRX), headquartered in
Bridgewater, NJ, is a fully-integrated essential medicines company.
We make healthy possible through the development, manufacturing,
and distribution of generic and specialty pharmaceuticals,
primarily within the United States. The Company has a diverse
portfolio of over 250 products in its Generics segment and is
expanding across a broad range of complex products and therapeutic
areas, including injectables and biosimilars. In its Specialty
segment, Amneal has a growing portfolio of branded pharmaceutical
products focused primarily on central nervous system and endocrine
disorders, with a pipeline focused on unmet needs. Through its
AvKARE segment, the Company is a distributor of pharmaceuticals and
other products for the U.S. federal government, retail, and
institutional markets. For more information, please visit
www.amneal.com.
Cautionary Statement on Forward-Looking Statements
Certain statements contained herein, regarding matters that are
not historical facts, may be forward-looking statements (as defined
in the U.S. Private Securities Litigation Reform Act of 1995). Such
forward-looking statements include statements regarding
management’s intentions, plans, beliefs, expectations or forecasts
for the future, including among other things: discussions of future
operations; expected operating results and financial performance;
impact of planned acquisitions and dispositions; the Company’s
strategy for growth; product development; regulatory approvals;
market position and expenditures. Words such as “plans,” “expects,”
“will,” “anticipates,” “estimates” and similar words are intended
to identify estimates and forward-looking statements.
The reader is cautioned not to rely on these forward-looking
statements. These forward-looking statements are based on current
expectations of future events. If the underlying assumptions prove
inaccurate or known or unknown risks or uncertainties materialize,
actual results could vary materially from the expectations and
projections of the Company.
Such risks and uncertainties include, but are not limited to:
our ability to successfully develop, license, acquire and
commercialize new products on a timely basis; the competition we
face in the pharmaceutical industry from brand and generic drug
product companies, and the impact of that competition on our
ability to set prices; our ability to obtain exclusive marketing
rights for our products; our ability to manage our growth through
acquisitions and otherwise; our dependence on the sales of a
limited number of products for a substantial portion of our total
revenues; the continuing trend of consolidation of certain customer
groups; our dependence on third-party suppliers and distributors
for raw materials for our products and certain finished goods and
any associated supply chain disruptions; legal, regulatory and
legislative efforts by our brand competitors to deter competition
from our generic alternatives; the impact of severe weather; the
impact of the ongoing COVID-19 pandemic; risks related to federal
regulation of arrangements between manufacturers of branded and
generic products; our reliance on certain licenses to proprietary
technologies from time to time; the significant amount of resources
we expend on research and development; the risk of product
liability and other claims against us by consumers and other third
parties; risks related to changes in the regulatory environment,
including U.S. federal and state laws related to healthcare fraud
abuse and health information privacy and security and changes in
such laws; changes to Food and Drug Administration product approval
requirements; the impact of healthcare reform and changes in
coverage and reimbursement levels by governmental authorities and
other third-party payers; our dependence on third-party agreements
for a portion of our product offerings; the impact of global
economic conditions, including any economic effects stemming from
adverse geopolitical events, an economic downturn and inflation
rates; our ability to identify, make and integrate acquisitions or
investments in complementary businesses and products on
advantageous terms; our substantial amount of indebtedness and our
ability to generate sufficient cash to service our indebtedness in
the future, and the impact of interest rate fluctuations on such
indebtedness; our obligations under a tax receivable agreement may
be significant; and the high concentration of ownership of our
Class A Common Stock and the fact that we are controlled by the
Amneal Group. The forward-looking statements contained herein are
also subject generally to other risks and uncertainties that are
described from time to time in the Company’s filings with the
Securities and Exchange Commission, including under Item 1A, “Risk
Factors” in the Company’s most recent Annual Report on Form 10-K
and in its subsequent reports on Forms 10-Q and 8-K. Investors are
cautioned not to place undue reliance on any such forward-looking
statements, which speak only as of the date they are made.
Forward-looking statements included herein speak only as of the
date hereof and we undertake no obligation to revise or update such
statements to reflect the occurrence of events or circumstances
after the date hereof.
Non-GAAP Financial Measures
Beginning in the first quarter of 2022, we will no longer
exclude research and development milestone expenses related to
license and collaboration agreements from our non-GAAP financial
measures and our line item components, including adjusted research
and development, adjusted EBITDA, adjusted operating income,
adjusted net income and adjusted earnings per share. Prior period
adjusted results have been revised to reflect this change.
This release includes certain non-GAAP financial measures,
including EBITDA, adjusted EBITDA, adjusted net income, adjusted
diluted earnings per share, adjusted gross profit, adjusted gross
margin, adjusted operating income, adjusted cost of goods sold,
adjusted selling general and administrative expense, and adjusted
research and development expense, which are intended as
supplemental measures of the Company’s performance that are not
required by or presented in accordance with GAAP. The calculation
of non-GAAP adjusted diluted earnings per share assumes the
conversion of all outstanding shares of class B Common Stock to
shares of class A Common Stock under the if-converted method.
Management uses these non-GAAP measures internally to evaluate
and manage the Company’s operations and to better understand its
business because they facilitate a comparative assessment of the
Company's operating performance relative to its performance based
on results calculated under GAAP. These non-GAAP measures also
isolate the effects of some items that vary from period to period
without any correlation to core operating performance and eliminate
certain charges that management believes do not reflect the
Company's operations and underlying operational performance. The
compensation committee of the Company’s board of directors also
uses certain of these measures to evaluate management's performance
and set its compensation. The Company believes that these non-GAAP
measures also provide useful information to investors regarding
certain financial and business trends relating to the Company’s
financial condition and operating results facilitates an evaluation
of the financial performance of the Company and its operations on a
consistent basis. Providing this information therefore allows
investors to make independent assessments of the Company’s
financial performance, results of operations and trends while
viewing the information through the eyes of management.
These non-GAAP measures are subject to limitations. The non-GAAP
measures presented in this release may not be comparable to
similarly titled measures used by other companies because other
companies may not calculate one or more in the same manner.
Additionally, the non-GAAP performance measures exclude significant
expenses and income that are required by GAAP to be recorded in the
Company’s financial statements; do not reflect changes in, or cash
requirements for, working capital needs; and do not reflect
interest expense, or the requirements necessary to service interest
or principal payments on debt. Further, our historical adjusted
results are not intended to project our adjusted results of
operations or financial position for any future period. To
compensate for these limitations, management presents and considers
these non-GAAP measures in conjunction with the Company’s GAAP
results; no non-GAAP measure should be considered in isolation from
or as alternatives to net income, diluted earnings per share, gross
profit, gross margin, operating income, cost of goods sold, selling
general and administrative expense, and research and development
expense or any other measure determined in accordance with GAAP.
Readers should review the reconciliations included below, and
should not rely on any single financial measure to evaluate the
Company’s business.
A reconciliation of each historical non-GAAP measure to the most
directly comparable GAAP measure is set forth below.
Amneal Pharmaceuticals, Inc.
Consolidated Statements of Operations (Unaudited; In thousands,
except per share amounts)
Three Months Ended March
31,
2022
2021
Net revenue
$
497,633
$
493,105
Cost of goods sold
323,062
301,543
Gross profit
174,571
191,562
Selling, general and administrative
98,665
90,726
Research and development
52,798
48,182
Intellectual property legal development
expenses
764
3,582
Acquisition, transaction-related and
integration expenses
434
2,802
Credit related to legal matters, net
(2,326
)
—
Restructuring and other charges
731
363
Change in fair value of contingent
consideration
200
—
Operating income
23,305
45,907
Other (expense) income:
Interest expense, net
(33,335
)
(33,885
)
Foreign exchange (loss) gain, net
(2,013
)
2,088
Other income, net
2,122
794
Total other expense, net
(33,226
)
(31,003
)
(Loss) income before income taxes
(9,921
)
14,904
(Benefit from) provision for income
taxes
(3,461
)
359
Net (loss) income
(6,460
)
14,545
Less: Net loss (income) attributable to
non-controlling interests
4,742
(7,839
)
Net (loss) income attributable to
Amneal Pharmaceuticals, Inc. before accretion of redeemable
non-controlling interest
$
(1,718
)
$
6,706
Accretion of redeemable non-controlling
interest
(438
)
—
Net (loss) income attributable to
Amneal Pharmaceuticals, Inc.
$
(2,156
)
$
6,706
Net (loss) income per share
attributable to Amneal Pharmaceuticals, Inc.'s class A common
stockholders:
Basic
$
(0.01
)
$
0.05
Diluted
$
(0.01
)
$
0.04
Weighted-average common shares
outstanding:
Basic
149,892
148,013
Diluted
149,892
151,220
Amneal Pharmaceuticals, Inc.
Condensed Consolidated Balance Sheets (Unaudited; In
thousands)
March 31, 2022
December 31, 2021
Assets
Current assets:
Cash and cash equivalents
$
210,477
$
247,790
Restricted cash
6,068
8,949
Trade accounts receivable, net
538,309
662,583
Inventories
512,241
489,389
Prepaid expenses and other current
assets
121,408
110,218
Related party receivables
1,175
1,179
Total current assets
1,389,678
1,520,108
Property, plant and equipment, net
500,911
514,158
Goodwill
602,893
593,017
Intangible assets, net
1,209,818
1,166,922
Operating lease right-of-use assets
37,675
39,899
Operating lease right-of-use assets -
related party
19,846
20,471
Financing lease right-of-use assets
64,204
64,475
Other assets
63,943
20,614
Total assets
$
3,888,968
$
3,939,664
Liabilities and Stockholders'
Equity
Current liabilities:
Accounts payable and accrued expenses
$
539,734
$
583,345
Current portion of long-term debt, net
30,523
30,614
Current portion of operating lease
liabilities
9,901
9,686
Current portion of operating and financing
lease liabilities - related party
2,692
2,636
Current portion of financing lease
liabilities
3,233
3,101
Related party payables - short term
15,960
47,861
Total current liabilities
602,043
677,243
Long-term debt, net
2,672,661
2,680,053
Note payable - related party
38,443
38,038
Operating lease liabilities
30,378
32,894
Operating lease liabilities - related
party
18,093
18,783
Financing lease liabilities
60,286
60,251
Related party payables - long term
10,371
9,619
Other long-term liabilities
32,866
38,903
Total long-term liabilities
2,863,098
2,878,541
Redeemable non-controlling interests
16,420
16,907
Total stockholders' equity
407,407
366,973
Total liabilities and stockholders'
equity
$
3,888,968
$
3,939,664
Amneal Pharmaceuticals, Inc.
Consolidated Statements of Cash Flows (Unaudited; In
thousands)
Three Months Ended March
31,
2022
2021
Cash flows from operating
activities:
Net (loss) income
$
(6,460
)
$
14,545
Adjustments to reconcile net (loss) income
to net cash provided by operating activities:
Depreciation and amortization
57,815
55,549
Unrealized foreign currency loss
(gain)
3,140
(1,970
)
Amortization of debt issuance costs and
discount
2,195
2,183
Stock-based compensation
8,065
5,330
Inventory provision
3,578
16,021
Change in fair value of contingent
consideration
200
—
Other operating charges and credits,
net
1,155
1,431
Changes in assets and liabilities:
Trade accounts receivable, net
124,268
108,385
Inventories
(25,549
)
(20,283
)
Prepaid expenses, other current assets and
other assets
(4,423
)
602
Related party receivables
4
301
Accounts payable, accrued expenses and
other liabilities
(48,777
)
(37,226
)
Related party payables
5,132
3,260
Net cash provided by operating
activities
120,343
148,128
Cash flows from investing
activities:
Purchases of property, plant and
equipment
(10,793
)
(11,776
)
Deposits for future acquisition of
property, plant, and equipment
(1,888
)
(917
)
Acquisition of business
(84,714
)
—
Net cash used in investing activities
(97,395
)
(12,693
)
Cash flows from financing
activities:
Payments of principal on debt, financing
leases and other
(9,796
)
(23,630
)
Proceeds from exercise of stock
options
111
676
Employee payroll tax withholding on
restricted stock unit vesting
(3,001
)
(2,102
)
Tax distributions to non-controlling
interests
(3,164
)
—
Acquisition of redeemable non-controlling
interest
(1,722
)
—
Payments of deferred consideration for
acquisitions - related party
(43,998
)
—
Payments of principal on financing lease -
related party
—
(93
)
Repayment of related party note
—
(1,000
)
Net cash used in financing activities
(61,570
)
(26,149
)
Effect of foreign exchange rate on
cash
(1,572
)
(593
)
Net (decrease) increase in cash, cash
equivalents, and restricted cash
(40,194
)
108,693
Cash, cash equivalents, and restricted
cash - beginning of period
256,739
347,121
Cash, cash equivalents, and restricted
cash - end of period
$
216,545
$
455,814
Cash and cash equivalents - end of
period
$
210,477
$
452,097
Restricted cash - end of period
6,068
3,717
Cash, cash equivalents, and restricted
cash - end of period
$
216,545
$
455,814
Amneal Pharmaceuticals, Inc.
Non-GAAP Reconciliations (Unaudited, In thousands) Reconciliation
of Net (Loss) Income to EBITDA and Adjusted EBITDA (1)
Three Months Ended March
31,
2022
2021
Net (loss) income
$
(6,460
)
$
14,545
Adjusted to add (deduct):
Interest expense, net
33,335
33,885
Income tax expense (benefit)
(3,461
)
359
Depreciation and amortization
57,815
55,549
EBITDA (Non-GAAP)
$
81,229
$
104,338
Adjusted to add (deduct):
Stock-based compensation expense
8,065
5,330
Acquisition, site closure, and idle
facility expenses (2)
5,589
5,792
Restructuring and other charges (3)
731
363
Inventory related charges
—
114
Credit related to legal matters, net
(4)
(2,326
)
—
Asset impairment charges
—
323
Foreign exchange loss (gain)
2,013
(2,088
)
Regulatory approval milestone
5,000
—
Change in fair value of contingent
consideration
200
—
Other
(641
)
999
Adjusted EBITDA (Non-GAAP)
$
99,860
$
115,171
Amneal Pharmaceuticals, Inc.
Non-GAAP Reconciliations (Unaudited; In thousands, except per share
amounts) Reconciliation of Net (Loss) Income to Adjusted Net Income
and Calculation of Adjusted Diluted Earnings Per Share (1)
Three Months Ended March
31,
2022
2021
Net (loss) income
$
(6,460
)
$
14,545
Adjusted to add (deduct):
Non-cash interest
1,982
1,972
GAAP Income tax (benefit) expense
(3,461
)
359
Amortization
39,152
39,514
Stock-based compensation expense
8,065
5,330
Acquisition, site closure expenses, and
idle facility expenses (2)
5,589
5,792
Restructuring and other charges (3)
731
363
Inventory related charges
—
114
Credit related to legal matters, net
(4)
(2,326
)
—
Asset impairment charges
—
323
Regulatory approval milestone
5,000
—
Change in fair value of contingent
consideration
200
—
Other
(500
)
999
Income tax (5)
(10,185
)
(15,053
)
Net income attributable to non-controlling
interests not associated with our class
B common stock
(2,199
)
(1,796
)
Adjusted net income (Non-GAAP)
$
35,588
$
52,462
Weighted average diluted shares
outstanding (Non-GAAP) (6)
304,630
303,337
Adjusted diluted earnings per share
(Non-GAAP)
$
0.12
$
0.17
Amneal Pharmaceuticals, Inc.
Non-GAAP Reconciliations (Unaudited; In thousands) Explanations for
Reconciliations of Net (Loss) Income to EBITDA and Adjusted EBITDA
and Net (Loss) Income to Adjusted Net Income and Calculation of
Adjusted Diluted Earnings per Share
(1)
Beginning in the first quarter of 2022, we
will no longer exclude research and development milestone expenses
related to license and collaboration agreements from our non-GAAP
financial measures and our line item components, including adjusted
research and development, adjusted EBITDA, adjusted operating
income, adjusted net income and adjusted earnings per share. Prior
period adjusted results have been revised to reflect this
change.
(2)
Acquisition, site closure, and idle
facility expenses for the three months ended March 31, 2022
primarily included (i) transaction and integration costs associated
with the acquisition of the baclofen franchise from certain
entities affiliated with Saol International Limited; (ii.)
integration costs associated with the acquisition of Puniska
Healthcare Pvt. Ltd.; and (iii) site closure costs associated with
the planned cessation of manufacturing at our Hauppauge, NY
facility. Acquisition, site closure and idle facility expenses for
the three months ended March 31, 2021 primarily included (i)
transaction costs associated with the acquisition of Kashiv
Specialty Pharmaceuticals, LLC, which closed on April 2, 2021; (ii)
integration costs associated with the acquisition of AvKARE; and
(iii) site closure expenses associated with the planned cessation
of manufacturing at our Hauppauge, NY facility.
(3)
For the three months ended March 31, 2022
and 2021, restructuring and other charges primarily consisted of
cash severance charges associated with the cost of benefits for
former senior executives and management employees.
(4)
For the three months ended March 31, 2022,
we recorded a net credit of $2.3 million consisting of an insurance
recovery of $4 million, partially offset by charges for legal
proceedings (none for the three months ended March 31, 2021).
(5)
The non-GAAP effective tax rates for the
three months ended March 31, 2022 and 2021 were 22.3% and 21.0%,
respectively.
(6)
Weighted average diluted shares
outstanding consisted of class A common stock and class B common
stock under the if-converted method.
Amneal Pharmaceuticals, Inc.
Generics Segment Reconciliation of GAAP to Non-GAAP Operating
Results (1) (Unaudited; In thousands)
Three Months Ended March 31,
2022
Three Months Ended March 31,
2021
As Reported
Adjustments
Non-GAAP
As Reported
Adjustments
Non-GAAP
Net revenue
$
317,747
$
—
$
317,747
$
312,508
$
—
$
312,508
Cost of goods sold (2)
199,030
(15,091
)
183,939
185,298
(12,019
)
173,279
Gross profit
118,717
15,091
133,808
127,210
12,019
139,229
Gross margin %
37.4
%
42.1
%
40.7
%
44.6
%
Selling, general and administrative
(3)
27,593
(6,250
)
21,343
18,762
(824
)
17,938
Research and development (4)
43,221
(1,159
)
42,062
36,117
(1,002
)
35,115
Charges related to legal matters, net
(5)
1,674
(1,674
)
—
—
—
—
Intellectual property legal development
expenses
772
—
772
3,582
—
3,582
Restructuring and other charges
206
(206
)
—
80
(80
)
—
Operating income
$
45,251
$
24,380
$
69,631
$
68,669
$
13,925
$
82,594
(1)
Operating results for the sale of
Amneal products by AvKARE were included in our Generics
segment.
(2)
Adjustments for the three months
ended March 31, 2022 and 2021, respectively, were comprised of
stock-based compensation expense ($1.5 million and $0.6 million),
amortization expense ($9.3 million and $8.0 million), site closure
and idle facility expenses ($4.6 million and $2.5 million),
inventory related charges (none and $0.1 million), asset impairment
charges (none and $0.3 million), and other ($(0.3) million and $0.5
million).
(3)
Adjustments for the three months
ended March 31, 2022 and 2021, respectively, were comprised of
stock-based compensation expense ($0.7 million and $0.3 million), a
regulatory approval milestone ($5.0 million and none) and site
closure costs ($0.6 million and $0.5 million).
(4)
Adjustments for the three months
ended March 31, 2022 and 2021, respectively, were comprised of
stock-based compensation expense ($1.2 million and $0.8 million)
and other (none and $0.2 million). Non-GAAP adjusted research and
development for the three months ended March 31, 2021, as
previously reported, has been revised to include $3.4 million of
research and development milestone expenses previously
excluded.
(5)
Adjustments for the three months
ended March 31, 2022 were related to charges for legal
proceedings.
Amneal Pharmaceuticals, Inc.Specialty SegmentReconciliation of
GAAP to Non-GAAP Operating Results(Unaudited; In thousands)
Three Months Ended March 31,
2022
Three Months Ended March 31,
2021
As Reported
Adjustments
Non-GAAP
As Reported
Adjustments
Non-GAAP
Net revenue
$
85,086
$
—
$
85,086
$
95,931
$
—
$
95,931
Cost of goods sold (1)
43,853
(26,653
)
17,200
48,198
(27,493
)
20,705
Gross profit
41,233
26,653
67,886
47,733
27,493
75,226
Gross margin %
48.5
%
79.8
%
49.8
%
78.4
%
Selling, general and administrative
(2)
24,400
(613
)
23,787
19,881
(591
)
19,290
Research and development (3)
9,577
(326
)
9,251
12,065
(180
)
11,885
Change in fair value of contingent
consideration (4)
200
(200
)
—
—
—
—
Intellectual property legal development
credit
(8
)
—
(8
)
—
—
—
Operating income
$
7,064
$
27,792
$
34,856
$
15,787
$
28,264
$
44,051
(1)
Adjustments for the three months ended
March 31, 2022 and 2021 were comprised of amortization expense.
(2)
Adjustments for the three months ended
March 31, 2022 and 2021 were comprised of stock-based compensation
expense.
(3)
Adjustments for the three months ended
March 31, 2022 and 2021 were comprised of stock-based compensation
expense. Non-GAAP adjusted research and development for the three
months ended March 31, 2021, as previously reported, has been
revised to include $7.4 million of research and development
milestone expenses previously excluded.
(4)
Contingent consideration was recorded in
connection with the acquisition of Kashiv Specialty
Pharmaceuticals, LLC.
Amneal Pharmaceuticals, Inc.
AvKARE Segment Reconciliation of GAAP to Non-GAAP Operating Results
(1) (Unaudited; In thousands)
Three Months Ended March 31,
2022
Three Months Ended March 31,
2021
As Reported
Adjustments
Non-GAAP
As Reported
Adjustments
Non-GAAP
Net revenue
$
94,800
$
—
$
94,800
$
84,666
$
—
$
84,666
Cost of goods sold
80,179
—
80,179
68,047
—
68,047
Gross profit
14,621
—
14,621
16,619
—
16,619
Gross margin %
15.4
%
15.4
%
19.6
%
19.6
%
Selling, general and administrative
(2)
13,410
(4,526
)
8,884
13,704
(6,184
)
7,520
Acquisition, transaction-related and
integration expenses (3)
—
—
—
931
$
(931
)
—
Operating income (loss)
$
1,211
$
4,526
$
5,737
$
1,984
$
7,115
$
9,099
(1)
Operating results for the sale of Amneal
products by AvKARE were included in our Generics segment.
(2)
Adjustments for the three months ended
March 31, 2022 and 2021, respectively, were comprised of
amortization expense ($4.9 million and $6.2 million) and other
($(0.4) million and none).
(3)
Adjustments for the three months ended
March 31, 2021 were comprised of finance integration expenses.
Amneal Pharmaceuticals, Inc.
Reconciliation of Previously Reported GAAP and Non-GAAP Results to
Revised Non-GAAP Results for Prior Periods (Unaudited; In
thousands, except per share amounts)
Three months ended
Year ended
Dec. 31, 2021
Sept. 30, 2021
June 30, 2021
March 31, 2021
Dec. 31, 2021
Dec. 31, 2020
Net (loss) income
$ (20,459)
$ (6,092)
$ 32,176
$ 14,545
$ 20,170
$ 68,578
Adjusted to add (deduct):
Interest expense, net
33,957
34,400
34,083
33,885
136,325
145,998
Income tax expense (benefit)
4,140
4,049
2,648
359
11,196
(104,358)
Depreciation and amortization
61,183
60,186
56,487
55,549
233,406
235,387
EBITDA (Non-GAAP)
$ 78,821
$ 92,543
$ 125,394
$ 104,338
$ 401,097
$ 345,605
Adjusted to add (deduct):
Stock-based compensation expense
7,742
7,708
7,632
5,330
28,412
20,750
Acquisition, site closure, and idle
facility expenses
6,027
2,220
5,964
5,792
20,003
23,384
Restructuring and other charges
—
425
—
363
788
2,398
Inventory related charges
16
44
87
114
261
6,574
Charges related to legal matters, net
6,000
19,000
—
—
25,000
5,610
Asset impairment charges
22,353
688
741
323
24,105
43,629
Foreign exchange loss (gain)
170
29
2,244
(2,088)
355
(16,350)
Gain on sale of international businesses,
net
—
—
—
—
—
(123)
Research and development milestones
4,566
2,496
7,847
10,886
25,795
22,771
Change in fair value of contingent
consideration
(100)
300
—
—
200
—
Property losses and associated expenses,
net
(2,818)
8,186
—
—
5,368
—
Other
3,592
1,282
807
999
6,680
1,926
Adjusted EBITDA (Non-GAAP), as
previously reported
$ 126,369
$ 134,921
$ 150,716
$ 126,057
$ 538,064
$ 456,174
Research and development milestones
(1)
(4,566)
(2,496)
(7,847)
(10,886)
(25,795)
(22,771)
Adjusted EBITDA (Non-GAAP), as
revised
$ 121,803
$ 132,425
$ 142,869
$ 115,171
$ 512,269
$ 433,403
(1)
Beginning in the first quarter of 2022, we
will no longer exclude research and development milestone expenses
related to license and collaboration agreements from our non-GAAP
financial measures and our line item components, including adjusted
research and development, adjusted EBITDA, adjusted operating
income, adjusted net income and adjusted diluted earnings per
share. Prior period results have been revised to reflect this
change.
Amneal Pharmaceuticals, Inc.
Reconciliation of Previously Reported GAAP and Non-GAAP Results to
Revised Non-GAAP Results for Prior Periods (Unaudited; In
thousands, except per share amounts)
Three months ended
Year ended
Dec. 31, 2021
Sept. 30, 2021
June 30, 2021
March 31, 2021
Dec. 31, 2021
Dec. 31, 2020
Net (loss) income
$
(20,459
)
$
(6,092
)
$
32,176
$
14,545
$
20,170
$
68,578
Adjusted to add (deduct):
Non-cash interest
2,123
2,183
2,077
1,972
8,355
7,900
GAAP Income tax expense (benefit)
4,140
4,049
2,648
359
11,196
(104,358
)
Amortization
41,543
41,651
41,361
39,514
164,069
163,842
Stock-based compensation expense
7,742
7,708
7,632
5,330
28,412
20,750
Acquisition, site closure, and idle
facility expenses
6,027
2,220
5,964
5,792
20,003
23,384
Restructuring and other charges
—
425
—
363
788
2,398
Inventory related charges
16
44
87
114
261
6,574
Charges related to legal matters, net
6,000
19,000
—
—
25,000
5,610
Asset impairment charges
22,353
688
741
323
24,105
43,629
Foreign exchange gain
—
—
—
—
—
(16,350
)
Gain on sale of international businesses,
net
—
—
—
—
—
(123
)
Research and development milestones
4,566
2,496
7,847
10,886
25,795
22,771
Change in fair value of contingent
consideration
(100
)
300
—
—
200
—
Property losses and associated expenses,
net
(2,818
)
8,186
—
—
5,368
—
Other
3,592
1,282
807
999
6,680
1,926
Income tax
(19,313
)
(17,346
)
(21,779
)
(17,339
)
(75,777
)
(54,271
)
Net income attributable to non-controlling
interests not associated with our Class B common stock
(1,191
)
(1,541
)
(2,054
)
(1,796
)
(6,582
)
(1,240
)
Adjusted net income (Non-GAAP), as
previously reported
$
54,221
$
65,253
$
77,507
$
61,062
$
258,043
$
191,020
Research and development milestones
(1)
(4,566
)
(2,496
)
(7,847
)
(10,886
)
(25,795
)
(22,771
)
Income tax impact of revision
1,120
525
1,647
2,286
5,578
4,640
Adjusted net income (Non-GAAP), as
revised
$
50,775
$
63,282
$
71,307
$
52,462
$
237,826
$
172,889
Weighted average diluted shares
outstanding (Non-GAAP) (2)
304,429
303,861
304,103
303,337
303,937
301,030
Adjusted diluted EPS (Non-GAAP), as
previously reported
$
0.18
$
0.21
$
0.25
$
0.20
$
0.85
$
0.63
Adjusted diluted EPS (Non-GAAP), as
revised
$
0.17
$
0.21
$
0.23
$
0.17
$
0.78
$
0.57
(1)
Beginning in the first quarter of 2022, we
will no longer exclude research and development milestone expenses
related to license and collaboration agreements from our non-GAAP
financial measures and our line item components, including adjusted
research and development, adjusted EBITDA, adjusted operating
income, adjusted net income and adjusted diluted earnings per
share. Prior period results have been revised to reflect this
change.
(2)
Weighted average diluted shares
outstanding consisted of class A common stock and class B common
stock under the if-converted method.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220504005166/en/
Anthony DiMeo Head of Investor Relations
anthony.dimeo@amneal.com
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