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Allergan (AGN) Reports Third Quarter 2016 Continuing Operations Performance With GAAP Net Revenues Of $3.6 Billion; Announces Accelerated Share Repurchase, Initiation Of Cash Dividend



11/2/2016 8:41:29 AM

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DUBLIN, Nov. 2, 2016 /PRNewswire/ -- Allergan plc (NYSE: AGN) today reported its third quarter 2016 continuing operations performance.

Logo - http://photos.prnewswire.com/prnh/20150612/222796LOGO

Third Quarter 2016 Continuing Operations

($ in millions, except per share amounts)


Q3 '16


Q3 '15


Q2 '16


Q3 '16
v Q3
'15


Q3 '16
v Q2
'16


Total net revenues*


$     3,622.2


$     3,469.5


$     3,684.8


4.4%


(1.7)%














Operating (Loss)


$      (266.4)


$   (1,377.4)


$      (487.6)


(80.7)%


(45.4)%


Diluted EPS - Continuing Operations


$        (1.15)


$        (2.40)


$        (1.25)


(52.1)%


(8.0)%


Cash Flow from Operations (including discontinued operations)


$   (1,092.4)


$     1,048.2


$     1,382.5


(204.2)%


(179.0)%


SG&A Expense


$     1,157.2


$     1,022.7


$     1,210.0


13.2%


(4.4)%


R&D Expense


$        622.8


$     1,260.5


$        636.5


(50.6)%


(2.2)%


Continuing Operations Tax Rate


29.5%


48.9%


37.9%


(19.4)%


(8.4)%














Non-GAAP Adjusted Operating Income


$     1,784.4


$     1,895.2


$     1,860.0


(5.8)%


(4.1)%


Non-GAAP Adjusted Diluted Net Income Per Share


$          3.32


$          3.41


$          3.35


(2.6)%


(0.9)%


Non-GAAP Adjusted EBITDA


$     1,902.2


$     1,987.2


$     1,936.6


(4.3)%


(1.8)%


Non-GAAP SG&A Expense


$     1,006.9


$        867.3


$     1,038.8


16.1%


(3.1)%


Non-GAAP R&D Expense


$        386.4


$        305.0


$        345.0


26.7%


12.0%


Non-GAAP Continuing Operations Tax Rate


8.2%


7.7%


7.1%


0.5%


1.1%














* Excludes the reclassification of revenues of ($23.7) million in Q3 2016, ($43.4) million in Q3 2015, and ($24.4) million in Q2 2016 related to the portion  of Allergan product revenues sold by our Anda Distribution Business into discontinued operations.

Total net revenues of $3.6 billion, a four percent increase versus the prior year quarter, were driven by strong performance from key brands and new product launches, offset by the loss of ASACOL® HD exclusivity, lower revenues for NAMENDA XR®and IR®, a decline in non-promoted Established Brands revenues and unfavorable foreign exchange impact.  

"Allergan continues to be among the best positioned biopharmaceutical companies to deliver long-term growth. Our top global products powered our performance in the third quarter, including BOTOX®, RESTASIS®, LINZESS® / CONSTELLA® and Fillers. Our R&D teams continued to deliver exceptional results and build our pipeline with our Open Science R&D approach, including the six new stepping stone acquisitions we announced this quarter. And we substantially added to our share repurchase plan and added a first-ever dividend payable in 2017 to maximize shareholder value," said Brent Saunders, Chairman, CEO and President, Allergan.

"We are focused on finishing 2016 with strong momentum. We are well positioned to leverage our Growth Pharma strategy deliver strong, durable top-line growth powered by growing franchises; enhance category leadership driven by innovative, high-value treatments; develop new treatments from our Open Science R&D pipeline; enhance our commitment to customer intimacy; and continue to support growth through operational excellence," added Saunders.

"We are also taking bold actions in these turbulent times when healthcare costs are in the spotlight. Through our Social Contract with Patients, we are defining our commitment to balancing investment and innovation with pricing and access, as well as quality and education. We are leading the way with responsible pricing ideals for our branded therapeutic products. This is our commitment to the people who count on us to find new treatments for their most pressing medical needs," said Saunders.

"I want to thank our 16,000 global colleagues who continue to Be Bold. They have remained focused on growing our businesses. They are bringing forward new ideas and approaches to drive our Company. And they are advancing new treatments in each of our therapeutic areas that will have a profound impact on patient care and health," added Saunders.  

GAAP operating loss from continuing operations in the third quarter 2016 was $266 million. Non-GAAP adjusted operating income from continuing operations in the third quarter 2016 was $1.78 billion. For the third quarter 2016, Non-GAAP adjusted EBITDA from continuing operations was $1.9 billion, compared to $2.0 billion for the third quarter 2015. The decrease was primarily due to higher research and development and selling and marketing costs. The Company reported negative cash flow from operations of $1.1 billion for the third quarter of 2016 which was unfavorably impacted by the $2.6 billion current period payment of taxes related to the divestiture of Allergan's Generics business to Teva.

Operating Expenses
Total GAAP Selling, General and Administrative (SG&A) Expense was $1.16 billion for the third quarter 2016 compared to $1.02 billion in the prior year period. Total non-GAAP SG&A Expense was $1.0 billion for the third quarter 2016 compared to $867 million in the prior year period due primarily to new product launches and promotion for key products. GAAP Research & Development (R&D) investment for the third quarter 2016 was $623 million. Non-GAAP R&D investment for the third quarter 2016 was $386 million, an increase over prior year due to costs related to key Eye Care and Central Nervous System development programs.

Amortization and Tax
Amortization expense from continuing operations for the third quarter 2016 was $1.6 billion, compared to $1.56 billion in the third quarter of 2015. The Company's GAAP continuing operations tax rate was 29.5 percent in the third quarter 2016.

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