- Q1'20 revenue of $664.7 million increased 20% as-reported,
or 22% in constant currency, from Q1'19.
- Adjusted its operating segments to better align internal
business unit structure with the "Follow the Molecule" strategy and
increase focus on biologics-related technologies, resulting in four
segments: Softgel and Oral Technologies, Biologics, Oral and
Specialty Delivery, and Clinical Supply Services.
- Double-digit organic revenue and segment EBITDA growth
across Softgel and Oral Technologies, Oral and Specialty Delivery,
and Clinical Supply Services segments.
- Integration of recently acquired gene therapy businesses
progressing ahead of expectations.
- Reaffirming FY'20 financial guidance range, which reflects
revenue growth of 10% to 14%, and adjusted EBITDA growth of 17% to
22%.
Catalent, Inc. (NYSE:CTLT), the leading global provider of
advanced delivery technologies, development, and manufacturing
solutions for drugs, biologics, gene therapies, and consumer health
products, today announced financial results for the first quarter
of fiscal year 2020, which ended September 30, 2019.
First quarter 2020 revenue of $664.7 million increased 20% as
reported, or 22% in constant currency, from the $551.8 million
reported in the first quarter a year ago, primarily driven by the
combined impact of the gene therapy acquisitions within the
Biologics segment, and organic growth within our Softgel and Oral
Technologies, Oral and Specialty Delivery, and Clinical Supply
Services segments.
First quarter 2020 net earnings were $0.1 million. After taking
into account the series A preferred dividend, net loss attributable
to common shareholders was $8.0 million, or a loss of $0.05 per
basic share, compared to a net loss of $14.4 million, or $0.10 per
basic share, in the first quarter a year ago.
First quarter 2020 EBITDA from operations of $90.1 million, as
referenced in the GAAP to non-GAAP reconciliation provided later in
this release, increased $22.5 million from $67.6 million in the
first quarter a year ago. First quarter 2020 Adjusted EBITDA (see
the non-GAAP reconciliation for a discussion of this metric) was
$127.1 million, or 19.1% of revenue, compared to $99.9 million, or
18.1% of revenue, in the first quarter a year ago. This represents
an increase of 27% as reported, and an increase of 28% on a
constant-currency basis, with all segments contributing to the
growth.
First quarter 2019 Adjusted Net Income (see the GAAP to non-GAAP
reconciliation) was $40.5 million, or $0.26 per diluted share,
compared to Adjusted Net Income of $25.4 million, or $0.18 per
diluted share, in the first quarter a year ago.
“Our financial performance for the first quarter was aligned
with our expectations and provides a strong start to our fiscal
year 2020,” said John Chiminski, Chair and Chief Executive Officer
of Catalent, Inc. “We continue to benefit from the robust market
demand within the CDMO industry, our leadership position, and the
recent investments within Biologics, including gene therapy. Our
May 2019 acquisition of viral vector developer and manufacturer
Paragon Bioservices has already begun to accelerate Catalent’s
financial growth and is creating substantial value for our
customers, patients, and shareholders.”
In fiscal 2020, the Company modestly adjusted its operating
segments to better align its internal business unit structure with
its “Follow the Molecule” strategy and the increased focus on its
biologics-related offerings. Under the revised structure, the
Company changed the components of three of its four operating
segments:
- Softgel and Oral Technologies includes formulation,
development, and clinical and commercial manufacturing of soft
capsules, or “softgels”, as well as large-scale manufacturing of
oral solid dose forms, for pharmaceutical and consumer health
markets, and supporting ancillary services.
- Biologics encompasses biologic cell-line and viral vector gene
therapy development and manufacturing; formulation, development,
and manufacturing for parenteral dose forms, including prefilled
syringes, vials, and cartridges; and analytical development and
testing services for large molecules.
- Oral and Specialty Delivery includes formulation, development,
and small to medium-scale manufacturing for most types of oral
solid dose forms, including Zydis orally dissolving tablets;
formulation, development, and manufacture of blow-fill-seal unit
doses, metered dose inhalers, and nasal products; and analytical
development and testing capabilities for small molecules.
The Company's fourth segment, Clinical Supply Services, remains
unchanged. The Company's operating segments are the same as its
reporting segments. All prior-period comparative segment
information has been restated to reflect the current reportable
segments in accordance with Accounting Standards Codification
("ASC") topic 280, Segment Reporting.
First Quarter 2020 Segment Highlights
Segment Revenue Highlights
Revenue from the Softgel and Oral Technologies segment was
$263.7 million for the first quarter of fiscal 2020, an increase of
10% as reported, or 12% in constant currency, compared to the first
quarter a year ago. The constant-currency increase was primarily
driven by increased consumer health volume in Europe and higher
demand for prescription and consumer health products across North
America, which is partly attributable to recently launched
products.
Revenue from the Biologics segment was $188.6 million for the
first quarter of fiscal 2020, an increase of 50% as reported, or
51% in constant currency, over the first quarter a year ago. The
constant-currency growth was primarily driven by the gene therapy
acquisitions, which contributed 45 percentage points to the
segment's revenue in constant currency. Excluding the impact of
these acquisitions, segment revenue increased 6% due to favorable
end-customer demand for our U.S.-based biologics drug product
offerings which, in turn, was due to improved capacity utilization,
partially offset by the fiscal 2019 completion of a
limited-duration customer contract for non-cell-line clinical
manufacturing services in our U.S. drug substance platform.
Revenue from the Oral and Specialty Delivery segment was $132.6
million for the first quarter of fiscal 2020, an increase of 20% as
reported, or 21% in constant currency, over the first quarter a
year ago. The constant-currency increase was principally
attributable to strong end-market demand for oral commercial
products across the U.S. and Europe, as well as an increased intake
of new molecules within our development and analytical services
platform. The Juniper acquisition, which closed in August 2018,
contributed 3 percentage points to the segment's revenue in
constant currency.
Revenue from the Clinical Supply Services segment was $84.6
million for the first quarter of fiscal 2020, an increase of 9% as
reported or 11% in constant currency, over the first quarter a year
ago. The constant-currency increase primarily resulted from strong
demand related to storage and distribution and manufacturing and
packaging services.
Segment EBITDA Highlights
Softgel and Oral Technologies segment EBITDA (see the non-GAAP
discussion below) was $46.4 million in the first quarter of fiscal
2020, an increase of 12% as reported, or 15% in constant currency,
versus the first quarter a year ago. The increase was primarily
driven by increased consumer health volume in Europe and higher
demand for high-margin prescription and consumer health products
across North America, which is partly attributable to recently
launched products.
Biologics segment EBITDA in the first quarter of fiscal 2020 was
$35.8 million, an increase of 33% as reported and in constant
currency. The constant-currency growth was driven by the gene
therapy acquisitions, which contributed 51 percentage points to
segment EBITDA in constant currency. Excluding the impact of these
acquisitions, segment EBITDA decreased 18%, driven by decreased
volume related to our U.S. drug substance product offering, which
was primarily due to the fiscal 2019 completion of a limited
duration customer contract for non-cell-line clinical manufacturing
services, partially offset by increased demand for our U.S.-based
drug product offering.
Oral Drug Delivery segment EBITDA in the first quarter of fiscal
2020 was $27.7 million, an increase of 47% as reported, or 51% in
constant currency, principally attributable to strong end-market
demand for high-margin oral commercial products across the U.S. and
Europe, as well as an increased intake of new molecules within our
development and analytical services platform. The Juniper
acquisition, which closed in August 2018, contributed 5 percentage
points to the segment's EBITDA growth in constant currency.
Clinical Supply Services segment EBITDA in the first quarter of
fiscal 2020 was $21.6 million, an increase of 7% as reported, or
11% in constant currency. The increase was primarily driven by
strong demand related to storage and distribution and manufacturing
and packaging services.
Additional Financial Highlights
First quarter 2020 gross margin of 26.7% decreased 20 basis
points as-reported, from 26.9% in the first quarter a year ago. The
decrease was primarily attributable to the drug substance declines
within our Biologics segment due to the fiscal 2019 completion of a
limited duration customer contract for non-cell-line clinical
manufacturing services, partially offset by the gene therapy
acquisitions and margin improvement across the Softgel and Oral
Technologies and Oral and Specialty Delivery segments.
Backlog for the Clinical Supply Services segment, defined as
estimated future service revenues from work not yet completed under
signed contracts, was $374 million as of September 30, 2019, a 2%
increase compared to the fourth quarter of fiscal 2019. The segment
recorded net new business wins of $93 million during the first
quarter, which is an increase of 28% compared to the net new
business wins recorded in the same period of prior year. The
segment’s trailing-twelve-month book-to-bill ratio was 1.2x.
Balance Sheet and Liquidity
As of September 30, 2019, Catalent had $2.9 billion in total
debt, and $2.7 billion in total debt net of cash and short-term
investments, which is closely aligned with the net debt as of June
30, 2019. Catalent’s total net leverage ratio as of September 30,
2019 was 4.3x. On a pro forma basis for the May 2019 Paragon
Bioservices acquisition, Catalent’s total net leverage ratio as of
September 30, 2019 would have been 4.2x; an improvement compared to
the pro forma total net leverage ratio of 4.5x as of the time of
the announcement of the Paragon acquisition.
Fiscal Year 2020 Outlook
Management is reaffirming its previously issued financial
guidance. For fiscal 2020, the Company expects revenue in the range
of $2.78 billion to $2.88 billion. Catalent expects Adjusted EBITDA
in the range of $700 million to $730 million and Adjusted Net
Income in the range of $300 million to $330 million. The Company
expects a fully diluted share count in the range of 159 million to
160 million shares on a weighted-average basis, counting the Series
A preferred shares as-if converted.
Earnings Webcast
The Company’s management will host a webcast to discuss the
results at 8:15 a.m. ET today. Catalent invites all interested
parties to listen to the webcast, which will be accessible through
Catalent’s website at http://investor.catalent.com. A supplemental
slide presentation will also be available in the “Investors”
section of Catalent’s website prior to the start of the webcast.
The webcast replay, along with the supplemental slides, will be
available for 90 days in the “Investors” section of Catalent’s
website at www.catalent.com.
Upcoming Conference Presentation
The Company is announcing that John Chiminski, Chair and CEO,
and Wetteny Joseph, Senior Vice President & CFO, will present
at the Jefferies 2019 London Healthcare Conference at 4:00 p.m. GMT
on Thursday, November 21st, in London, England. A live webcast of
the presentations will be accessible through the Company’s website
at http://investor.catalent.com and will be available for replay
following the event.
About Catalent, Inc.
Catalent, Inc. (NYSE:CTLT) is the leading global provider of
advanced delivery technologies, development, and manufacturing
solutions for drugs, biologics, gene therapies, and consumer health
products. With over 85 years serving the industry, Catalent has
proven expertise in bringing more customer products to market
faster, enhancing product performance and ensuring reliable
clinical and commercial product supply. Catalent employs nearly
13,000 people, including approximately 2,400 scientists, at more
than 35 facilities across four continents and in fiscal 2019
generated over $2.5 billion in annual revenue. Catalent is
headquartered in Somerset, N.J. For more information, please visit
www.catalent.com.
Non-GAAP Financial Measures
Use of EBITDA from operations, Adjusted EBITDA, Adjusted Net
Income and Segment EBITDA
Management measures operating performance based on consolidated
earnings from operations before interest expense, expense/(benefit)
for income taxes, and depreciation and amortization (“EBITDA from
operations”). EBITDA from operations is not defined under U.S. GAAP
and is not a measure of operating income, operating performance or
liquidity presented in accordance with U.S. GAAP and is subject to
important limitations.
The Company believes that the presentation of EBITDA from
operations enhances an investor’s understanding of its financial
performance. The Company believes this measure is a useful
financial metric to assess its operating performance from period to
period by excluding certain items that it believes are not
representative of its core business and uses this measure for
business planning purposes.
In addition, given the significant investments that Catalent has
made in the past in property, plant and equipment, depreciation and
amortization expenses represent a meaningful portion of its cost
structure. The Company believes that EBITDA from operations will
provide investors with a useful tool for assessing the
comparability between periods of its ability to generate cash from
operations sufficient to pay taxes, to service debt and to
undertake capital expenditures because it eliminates depreciation
and amortization expense. The Company presents EBITDA from
operations in order to provide supplemental information that it
considers relevant for the readers of the Consolidated Financial
Statements, and such information is not meant to replace or
supersede U.S. GAAP measures. The Company’s definition of EBITDA
from operations may not be the same as similarly titled measures
used by other companies.
Catalent evaluates the performance of its segments based on
segment earnings before other (income)/expense, impairments,
restructuring costs, interest expense, income tax
expense/(benefit), and depreciation and amortization (“segment
EBITDA”). Moreover, under the Company's credit agreement, its
ability to engage in certain activities, such as incurring certain
additional indebtedness, making certain investments and paying
certain dividends, is tied to ratios based on Adjusted EBITDA,
which is not defined under U.S. GAAP and is subject to important
limitations. Adjusted EBITDA is the covenant compliance measure
used in the credit agreement governing debt incurrence and
restricted payments. Because not all companies use identical
calculations, the Company’s presentation of Adjusted EBITDA may not
be comparable to other similarly titled measures of other
companies.
Management also measures operating performance based on Adjusted
Net Income/(Loss) and Adjusted Net Income/(Loss) per share.
Adjusted Net Income/(Loss) is not defined under U.S. GAAP and is
not a measure of operating income, operating performance or
liquidity presented in accordance with U.S. GAAP and is subject to
important limitations. The Company believes that the presentation
of Adjusted Net Income/(Loss) and Adjusted Net Income/(Loss) per
share enhances an investor’s understanding of its financial
performance. The Company believes this measure is a useful
financial metric to assess its operating performance from period to
period by excluding certain items that it believes are not
representative of its core business and the Company uses this
measure for business planning purposes. The Company defines
Adjusted Net Income/(Loss) as net earnings/(loss) adjusted for
amortization attributable to purchase accounting and adjustments
for other cash and non-cash items included in the table below,
partially offset by its estimate of the tax effects of such cash
and non-cash items. The Company believes that Adjusted Net
Income/(Loss) and Adjusted Net Income/(Loss) per share will provide
investors with a useful tool for assessing the comparability
between periods of its ability to generate cash from operations
available to its stockholders. The Company’s definition of Adjusted
Net Income/(Loss) may not be the same as similarly titled measures
used by other companies.
The most directly comparable GAAP measure to EBITDA from
operations and Adjusted EBITDA is earnings/(loss) from operations.
The most directly comparable GAAP measure to Adjusted Net
Income/(Loss) is net earnings/(loss). Included in this release is a
reconciliation of earnings/(loss) from operations to EBITDA from
operations and Adjusted EBITDA and a reconciliation of net
earnings/(loss) to Adjusted Net Income.
The Company does not provide a reconciliation of forward-looking
non-GAAP financial measures to their comparable GAAP financial
measures because it could not do so without unreasonable effort due
to the unavailability of the information needed to calculate
reconciling items and due to the variability, complexity and
limited visibility of the adjusting items that would be excluded
from the non-GAAP financial measures in future periods. When
planning, forecasting and analyzing future periods, the Company
does so primarily on a non-GAAP basis without preparing a GAAP
analysis as that would require estimates for various cash and
non-cash reconciling items that would be difficult to predict with
reasonable accuracy. For example, equity compensation expense would
be difficult to estimate because it depends on the Company’s future
hiring and retention needs, as well as the future fair market value
of the Company’s common stock, all of which are difficult to
predict and subject to constant change. It is equally difficult to
anticipate the need for or magnitude of a presently unforeseen
one-time restructuring expense or the values of end-of-period
foreign currency exchange rates. As a result, the Company does not
believe that a GAAP reconciliation would provide meaningful
supplemental information about the Company’s outlook.
Use of Constant Currency
As changes in exchange rates are an important factor in
understanding period-to-period comparisons, the Company believes
the presentation of results on a constant currency basis in
addition to reported results helps improve investors’ ability to
understand its operating results and evaluate its performance in
comparison to prior periods. Constant currency information compares
results between periods as if exchange rates had remained constant
period over period. The Company uses results on a constant currency
basis as one measure to evaluate its performance. The Company
calculates constant currency by calculating current-year results
using prior-year foreign currency exchange rates. The Company
generally refers to such amounts calculated on a constant currency
basis as excluding the impact of foreign exchange or being on a
constant currency basis. These results should be considered in
addition to, not as a substitute for, results reported in
accordance with U.S. GAAP. Results on a constant currency basis, as
the Company presents them, may not be comparable to similarly
titled measures used by other companies and are not measures of
performance presented in accordance with U.S. GAAP.
Forward-Looking Statements
This release contains both historical and forward-looking
statements. All statements other than statements of historical fact
are, or may be deemed to be, forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended.
These forward-looking statements generally can be identified by the
use of statements that include phrases such as “believe,” “expect,”
“anticipate,” “intend,” “estimate,” “plan,” “project,” “foresee,”
“likely,” “may,” “will,” “would” or other words or phrases with
similar meanings. Similarly, statements that describe the Company’s
objectives, plans or goals are, or may be, forward-looking
statements. These statements are based on current expectations of
future events. If underlying assumptions prove inaccurate or
unknown risks or uncertainties materialize, actual results could
vary materially from Catalent, Inc.’s expectations and projections.
Some of the factors that could cause actual results to differ
include, but are not limited to, the following: participation in a
highly competitive market and increased competition may adversely
affect the business of the Company; demand for the Company’s
offerings, which depends in part on the Company’s customers’
research and development and the clinical and market success of
their products; product and other liability risks that could
adversely affect the Company’s results of operations, financial
condition, liquidity and cash flows; failure to comply with
existing and future regulatory requirements; failure to provide
quality offerings to customers could have an adverse effect on the
Company’s business and subject it to regulatory actions and costly
litigation; problems providing the highly exacting and complex
services or support required; global economic, political and
regulatory risks to the operations of the Company; inability to
enhance existing or introduce new technology or service offerings
in a timely manner; inadequate patents, copyrights, trademarks and
other forms of intellectual property protections; fluctuations in
the costs, availability, and suitability of the components of the
products the Company manufactures, including active pharmaceutical
ingredients, excipients, purchased components and raw materials;
changes in market access or healthcare reimbursement in the United
States or internationally; fluctuations in the exchange rate of the
U.S. dollar against other currencies, including as a result of the
U.K.’s pending exit from the European Union; adverse tax
legislative or regulatory initiatives or challenges or adjustments
to the Company’s tax positions; loss of key personnel; risks
generally associated with information systems; inability to
complete any future acquisitions, including the pending acquisition
of the Anagni facility, and other transactions that may complement
or expand the Company’s business or divest of non-strategic
businesses or assets and difficulties in successfully integrating
acquired businesses and realizing anticipated benefits of such
acquisitions; risks associated with timely and successfully
completing, and correctly anticipating the future demand predicted
for, capital expansion projects at our existing facilities,
offerings and customers’ products that may infringe on the
intellectual property rights of third parties; environmental,
health and safety laws and regulations, which could increase costs
and restrict operations; labor and employment laws and regulations
or labor difficulties, which could increase costs or result in
operational disruptions; additional cash contributions required to
fund the Company’s existing pension plans; substantial leverage
resulting in the limited ability of the Company to raise additional
capital to fund operations and react to changes in the economy or
in the industry, exposure to interest-rate risk to the extent of
the Company’s variable-rate debt and preventing the Company from
meeting its obligations under its indebtedness. For a more detailed
discussion of these and other factors, see the information under
the caption “Risk Factors” in the Company’s Annual Report on Form
10-K for the fiscal year ended June 30, 2019, filed August 27,
2019. All forward-looking statements speak only as of the date of
this release or as of the date they are made, and Catalent, Inc.
does not undertake to update any forward-looking statement as a
result of new information or future events or developments except
to the extent required by law.
More products. Better treatments. Reliably
supplied.™
Catalent, Inc. and
Subsidiaries
Consolidated Statements of
Operations
(Unaudited; dollars and shares
in millions, except per share data)
Three Months Ended
September 30,
FX Impact
Constant Currency
Increase/(Decrease)
2019
2018
Change $
Change %
Net revenue
$
664.7
$
551.8
$
(11.0)
$
123.9
22
%
Cost of sales
487.0
403.3
(8.1)
91.8
23
%
Gross margin
177.7
148.5
(2.9)
32.1
22
%
Selling, general and administrative
expenses
142.8
115.5
(1.0)
28.3
25
%
Impairment charges and (gain)/loss on sale
of assets
(0.2)
2.9
—
(3.1)
(107)
%
Restructuring and other
0.7
9.7
—
(9.0)
(93)
%
Operating earnings
34.4
20.4
(1.9)
15.9
78
%
Interest expense, net
36.3
28.1
(0.1)
8.3
30
%
Other expense/(income), net
4.9
5.7
(1.8)
1.0
18
%
Earnings from operations before income
taxes
(6.8)
(13.4)
—
6.6
(49)
%
Income tax expense(benefit)
(6.9)
1.0
(0.1)
(7.8)
(780)
%
Net earnings/(loss)
$
0.1
$
(14.4)
$
0.1
$
14.4
(100)
%
Less: Series A Preferred Stock
dividend
(8.1)
—
—
—
—
%
Net earnings/(loss) attributable to common
shareholders
$
(8.0)
$
(14.4)
$
—
$
—
—
%
Weighted average shares outstanding
145.7
142.1
Weighted average diluted shares
outstanding
145.7
142.1
Earnings/(loss) per share:
Basic
Net earnings/(loss)
$
(0.05)
$
(0.10)
Diluted
Net earnings/(loss)
$
(0.05)
$
(0.10)
Catalent, Inc. and
Subsidiaries
Selected Segment Financial
Data
(Unaudited; dollars in
millions)
Three Months Ended September
30,
FX Impact
Constant Currency
Increase/(Decrease)
2019
2018
Change $
Change %
Softgel and Oral Technologies
Net revenue
$
263.7
$
240.1
$
(6.0)
$
29.6
12
%
Segment EBITDA
46.4
41.3
(1.0)
6.1
15
%
Biologics
Net revenue
188.6
125.7
(1.5)
64.4
51
%
Segment EBITDA
35.8
27.0
(0.2)
9.0
33
%
Oral and Specialty Delivery
Net revenue
132.6
110.8
(1.9)
23.7
21
%
Segment EBITDA
27.7
18.9
(0.8)
9.6
51
%
Clinical Supply Services
Net revenue
84.6
77.7
(1.7)
8.6
11
%
Segment EBITDA
21.6
20.2
(0.8)
2.2
11
%
Inter-segment revenue
elimination
(4.8)
(2.5)
0.1
(2.4)
(96)
%
Unallocated Costs
(41.4)
(39.8)
2.0
(3.6)
(9)
%
Combined totals
Net revenue
$
664.7
$
551.8
$
(11.0)
$
123.9
22
%
EBITDA from operations
$
90.1
$
67.6
$
(0.8)
$
23.3
34
%
Catalent, Inc. and
Subsidiaries
Reconciliation of Net
Earnings/(Loss) to EBITDA from Operations and Adjusted
EBITDA*
(Unaudited; dollars in
millions)
Quarter Ended
September 30,
2018
December 31,
2018
March 31, 2019
June 30, 2019
September 30, 2019
Net earnings/(loss)
$
(14.4)
$
49.0
$
31.7
$
71.1
$
0.1
Interest expense, net
28.1
25.5
26.4
30.9
36.3
Income tax expense
1.0
2.3
10.9
8.7
(6.9)
Depreciation and amortization
52.9
54.6
66.4
54.7
60.6
EBITDA from operations
67.6
131.4
135.4
165.4
90.1
Equity compensation
10.0
7.5
6.6
9.2
16.6
Impairment charges and (gain)/loss on sale
of assets
2.9
(0.1)
(0.1)
2.4
(0.2)
Financing-related expenses and other
4.2
—
—
11.7
0.1
U.S. GAAP restructuring and other
9.7
0.1
3.1
1.2
0.7
Acquisition, integration, and other
special items
3.6
5.6
13.1
21.3
11.1
Foreign exchange loss/(gain) (included in
other, net)
2.0
1.0
(3.7)
1.2
(0.1)
Other adjustments
(0.1)
0.5
(0.1)
(13.0)
8.8
Adjusted EBITDA(1)
$
99.9
$
146.0
$
154.3
$
199.4
$
127.1
FX impact (unfavorable)
(0.9)
Adjusted EBITDA at constant currency
$
128.0
* Refer to the Company's description of
non-GAAP measures, including EBITDA from operations and Adjusted
EBITDA as referenced above.
(1)
In its earnings release for the quarter
ended September 30, 2018, the Company included an adjustment in the
reconciliation from net earnings to Adjusted EBITDA relating to a
cumulative effect of change in accounting for ASC 606. The Company
is no longer making this adjustment in its presentation of Adjusted
EBITDA.
Catalent, Inc. and
Subsidiaries
Reconciliation of Net
Earnings/(Loss) to Adjusted Net Income*
(Unaudited; in millions,
except per share data)
Quarter Ended
September 30, 2018
December 31,
2018
March 31, 2019
June 30, 2019
September 30, 2019
Net earnings /(loss)
$
(14.4)
$
49.0
$
31.7
$
71.1
$
0.1
Amortization (1)
18.2
19.5
31.4
19.1
21.5
Stock-based compensation
10.0
7.5
6.6
9.2
16.6
Impairment charges and (gain)/loss
on sale of assets
2.9
(0.1)
(0.1)
2.4
(0.2)
Financing-related expenses
4.2
—
—
11.7
0.1
U.S. GAAP restructuring and other
9.7
0.1
3.1
1.2
0.7
Acquisition, integration, and other
special items
3.6
5.6
13.1
21.3
11.1
Foreign exchange loss/(gain) (included in
other, net)
2.0
1.0
(3.7)
1.2
(0.1)
Other adjustments
(0.1)
0.5
(0.1)
(13.0)
8.8
Estimated tax effect of adjustments
(2)
(10.6)
(7.6)
(11.3)
(13.0)
(12.1)
Discrete income tax (benefit)/expense
items (3)
(0.1)
(3.3)
(2.8)
(8.3)
(6.0)
Tax law changes provision (4)
—
(6.8)
3.3
—
—
Adjusted net income (ANI)
$
25.4
$
65.4
$
71.2
$
102.9
$
40.5
Weighted average shares outstanding
142.1
145.7
Weighted average diluted shares
outstanding
144.1
160.9
ANI per share:
ANI per basic share
$
0.18
$
0.28
ANI per diluted share
$
0.18
$
0.26
Earnings/(loss) per share:
Net earnings/(loss) per basic share
$
(0.10)
$
(0.05)
Net earnings/(loss) per diluted share
$
(0.10)
$
(0.05)
* Refer to the Company's description of
non-GAAP measures, including Adjusted Net Income as referenced
above.
(1)
Represents the amortization attributable
to purchase accounting for previously completed business
combinations.
(2)
The tax effect of adjustments to Adjusted
Net Income are computed by applying the statutory tax rate in the
jurisdictions to the income or expense items that are adjusted in
the period presented; if a valuation allowance exists, the rate
applied is zero.
(3)
Discrete period income tax
expense/(benefit) items are unusual or infrequently occurring
items, primarily including: changes in judgment related to the
realizability of deferred tax assets in future years, changes in
measurement of a prior-year tax position, deferred tax impact of
changes in tax law, and purchase accounting.
(4)
During fiscal 2018, we recorded a net tax
charge of $42.5 million as a provisional estimate of the net
accounting impact of the 2017 Tax Act. In fiscal 2019, we completed
our analysis, as permitted by Staff Accounting Bulletin No. 118,
and recorded a reduction of $3.5 million.
Catalent, Inc. and
Subsidiaries
Condensed Consolidated Balance
Sheets
(Unaudited; dollars in
millions)
September 30,
2019
June 30, 2019
ASSETS
Current assets:
Cash and cash equivalents
$
243.4
$
345.4
Trade receivables, net
647.9
693.1
Inventories
250.7
257.2
Prepaid expenses and other
124.8
100.1
Total current assets
1,266.8
1,395.8
Property, plant, and equipment, net
1,561.1
1,536.7
Other non-current assets, including
intangible assets
3,291.6
3,251.5
Total assets
$
6,119.5
$
6,184.0
LIABILITIES, REDEEMABLE PREFERRED
STOCK, AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term obligations
and other short-term borrowings
$
74.3
$
76.5
Accounts payable
214.0
255.8
Other accrued liabilities
327.5
338.4
Total current liabilities
615.8
670.7
Long-term obligations, less current
portion
2,858.7
2,882.8
Other non-current liabilities
389.1
342.3
Commitments and contingencies (1)
—
—
Redeemable preferred stock
606.6
606.6
Total shareholders' equity
1,649.3
1,681.6
Total liabilities, redeemable preferred
stock, and shareholders' equity
$
6,119.5
$
6,184.0
(1)
Please refer to note 16 of the
consolidated financial statements within our Quarterly Report on
Form 10-Q for the fiscal year ended September 30, 2019.
Catalent, Inc. and
Subsidiaries
Condensed Consolidated
Statements of Cash Flows
(Unaudited; dollars in
millions)
Three Months Ended
September 30,
2019
2018
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net cash provided by operating
activities
$
25.2
$
41.2
CASH FLOWS FROM INVESTING
ACTIVITIES:
Acquisition of property, equipment, and
other productive assets
(73.5)
(38.3)
Payment for acquisitions, net of cash
acquired
(10.7)
(127.5)
Payments for investments
(0.7)
—
Net cash (used in) investing activities
from continuing operations
(84.9)
(165.8)
CASH FLOWS FROM FINANCING
ACTIVITIES:
Net change in other borrowings
(2.5)
(4.5)
Payments related to long-term
obligations
(3.3)
(454.7)
Dividends paid
(11.9)
—
Proceeds from sale of common stock,
net
—
445.5
Cash paid, in lieu of equity, for tax
withholding obligations
(18.1)
(5.1)
Net cash (used in)/provided by financing
activities
(35.8)
(18.8)
Effect of foreign currency exchange on
cash
(6.5)
(0.7)
NET INCREASE/(DECREASE) IN CASH AND
EQUIVALENTS
(102.0)
(144.1)
CASH AND EQUIVALENTS AT BEGINNING OF
PERIOD
345.4
410.2
CASH AND EQUIVALENTS AT END OF
PERIOD
$
243.4
$
266.1
View source
version on businesswire.com: https://www.businesswire.com/news/home/20191105005219/en/
Investors: Catalent, Inc. Thomas Castellano 732-537-6325
investors@catalent.com
Catalent (NYSE:CTLT)
Historical Stock Chart
From Aug 2024 to Sep 2024
Catalent (NYSE:CTLT)
Historical Stock Chart
From Sep 2023 to Sep 2024