‒ Full Year 2023 Performance Met or Exceeded
Financial Guidance Metrics –
‒ Q4 2023 Net Revenue of $617 million; GAAP Net
Loss of $99 million; Diluted Loss per Share of $0.40 ‒ ‒ Q4 2023
Adjusted Net Income(1) of $44 million, Adjusted EBITDA(1) of $142
million; Adjusted Diluted EPS(1) of $0.14 ‒
‒ Full Year 2023 Net Revenue of $2.39 billion;
GAAP Net Loss of $84 million; Diluted Loss per Share of $0.48 ‒ ‒
Full Year 2023 Adjusted Net Income(1) of $198 million; Adjusted
EBITDA(1) of $558 million; Adjusted Diluted EPS(1) of $0.64 ‒
‒ Provides 2024 Financial Guidance of $2.55 to
$2.65 billion in net revenue and $580 to $620 million in Adjusted
EBITDA(1) –
Amneal Pharmaceuticals, Inc. (Nasdaq: AMRX) (“Amneal” or
the “Company”) today announced its results for the fourth quarter
and full year ended December 31, 2023.
“Amneal had a very successful year in 2023 as we delivered
strong execution and growth across our diversified pharmaceutical
business. We are starting 2024 with substantial momentum and key
catalysts, including complex high-value products, biosimilars and
specialty, to further expand our reach. Against the macro backdrop
of a global aging population, significant unmet patient needs and
ongoing supply issues, Amneal’s mission to provide access to
high-quality, affordable, essential medicines has never been more
important or more aligned with industry dynamics. Our durable
business is ideally positioned to drive sustainable, profitable
growth and create value for all our stakeholders, this year and
beyond,” said Chirag and Chintu Patel, Co-Chief Executive
Officers.
Net revenue in the fourth quarter of 2023 was $617 million, an
increase of 1% compared to $610 million in the fourth quarter of
2022. The increase was driven by AvKARE revenues growing 38% due to
new launches and Specialty revenues growing 2% driven by key
branded products, partially offset by Generics revenues declining
9% as strong performance of biosimilars and complex generics was
offset by the timing of orders. Net loss attributable to Amneal
Pharmaceuticals, Inc. was $99 million in the fourth quarter of 2023
compared to a net loss of $4 million in the fourth quarter of 2022,
primarily due to non-cash intangible asset impairment charges and
costs associated with our term loan refinancing. Adjusted EBITDA(1)
in the fourth quarter of 2023 was $142 million, a decrease of 8%
compared to the fourth quarter of 2022, primarily due to
investments in research and development and commercial to drive
future growth. Diluted loss per share in the fourth quarter of 2023
was $0.40, an increase of $0.37 from a loss of $0.03 for the fourth
quarter of 2022, due to the aforementioned factors, partially
offset by an increase in the weighted-average common shares
outstanding as a result of our previously announced reorganization.
Adjusted diluted EPS(1) in the fourth quarter of 2023 was $0.14, a
decrease of 39% from $0.23 in the fourth quarter of 2022.
Net revenue for the year ended December 31, 2023 was $2.39
billion, an increase of 8% compared to $2.21 billion for the year
ended December 31, 2022. Revenue growth was driven by all three
business segments with AvKARE growing 31%, Generics growing 3% due
to strong performance of our complex portfolio and biosimilars, and
Specialty growing 4%. Net loss attributable to Amneal
Pharmaceuticals, Inc. was $84 million for the year ended December
31, 2023, an improvement of $41 million compared to a net loss of
$130 million for the year ended December 31, 2022. Adjusted
EBITDA(1) for the year ended December 31, 2023 was $558 million, an
increase of $44 million compared to the year ended December 31,
2022, reflective of strong revenue growth and continued operating
expense leverage. Diluted loss per share for the year ended
December 31, 2023 was $0.48, a decrease of 44% compared to diluted
loss per share of $0.86 for the year ended December 31, 2022.
Adjusted diluted EPS(1) in the year ended December 31, 2023 was
$0.64, a decrease of 6% from $0.68 for the year ended December 31,
2022, due to higher EBITDA offset by higher interest expense.
(1) See “Non-GAAP Financial Measures” below.
2024 Financial Guidance
Full
Year 2024 Guidance
Full
Year 2023 Actuals
Net revenue
$2.55 billion - $2.65 billion
$2.39 billion
Adjusted EBITDA (1)
$580 million - $620 million
$558 million
Adjusted diluted EPS (2)
$0.53 - $0.63
$0.64
Operating cash flow (3)
$260 million - $300 million
$346 million
Capital expenditures
$60 million - $70 million
$43 million
(1) Includes 100% of Adjusted EBITDA from the AvKARE
acquisition. See also “Non-GAAP Financial Measures” below. (2)
Accounts for 35% non-controlling interest in AvKARE. Assumes
weighted-average diluted shares outstanding of approximately 317
million for the year ending December 31, 2024, compared to
weighted-average diluted shares outstanding of 310 million for the
year ended December 31, 2023. See also “Non-GAAP Financial
Measures” below for assumptions used in calculation. (3) 2024 does
not contemplate one time and non-recurring items such as legal
settlements and other discrete items. 2023 includes the impact of a
payment of $85.5 million for the Opana ER® antitrust litigation
settlement, including interest.
Amneal’s 2024 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, legal settlements, 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 today, March 1, 2024, 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 (833) 470-1428 (in the U.S.) with access code
743629. A replay of the conference call will be posted shortly
after the call and will be available for seven days. For a list of
toll-free international numbers, visit this website:
https://www.netroadshow.com/events/global-numbers?confId=52762.
About Amneal
Amneal Pharmaceuticals, Inc. (Nasdaq: AMRX), headquartered in
Bridgewater, NJ, is a fully integrated global pharmaceutical
company. We make healthy possible through the development,
manufacturing, and distribution of a diverse portfolio of over 270
pharmaceutical products, primarily within the United States. In its
Generics segment, the Company is expanding across a broad range of
complex product categories and therapeutic areas, including
injectables and biosimilars. In its Specialty segment, Amneal has a
growing portfolio of branded pharmaceuticals 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, financial
results, or forecasts for the future, including among other things:
discussions of future operations; expected or estimated operating
results and financial performance; and statements regarding our
positioning, including our ability to drive sustainable long-term
growth, and other non-historical statements. Words such as “plans,”
“expects,” “will,” “anticipates,” “estimates,” and similar words,
or the negatives thereof, 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, including with respect to future
market conditions, company performance and financial results,
operational investments, business prospects, new strategies and
growth initiatives, the competitive environment, and other 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 revenues are derived from the sales of
a limited number of products, a substantial portion of which are
through a limited number of customers; the impact of a prolonged
business interruption within our supply chain; 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; legal, regulatory and
legislative efforts by our brand competitors to deter competition
from our generic alternatives; our dependence on information
technology systems and infrastructure and the potential for
cybersecurity incidents; our ability to attract, hire and retain
highly skilled personnel; 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 claims brought against us by
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; 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
potential expansion into additional international markets
subjecting us to increased regulatory, economic, social and
political uncertainties, including recent events affecting the
financial services industry; our ability to identify, make and
integrate acquisitions or investments in complementary businesses
and products on advantageous terms; the impact of global economic,
political or other catastrophic events; 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
This release includes certain non-GAAP financial measures,
including EBITDA, adjusted EBITDA, adjusted net income and adjusted
diluted EPS, which are intended as supplemental measures of the
Company’s performance that are not required by or presented in
accordance with GAAP. Adjusted diluted EPS reflects diluted
earnings per share based on adjusted net income, which is net loss
adjusted to (A) exclude (i) non-cash interest, (ii) GAAP provision
for (benefit from) income taxes, (iii) amortization, (iv)
stock-based compensation, (v) acquisition, site closure expenses,
and idle facility expenses, (vi) restructuring and other charges,
(vii) loss on refinancing, (viii) charges related to certain legal
matters, including interest, net, (ix) asset impairment charges,
(x) regulatory approval milestone, (xi) change in fair value of
contingent consideration, (xii) insurance recoveries for property
losses and associated expenses (xiii) increase in tax receivable
agreement liability, (xiv) system implementation expense, (xv)
reorganization expenses, (xvi) other and (xvii) net income
attributable to non-controlling interests not associated with class
B common stock, and (B) include non-GAAP provision for income
taxes. Non-GAAP adjusted diluted EPS was calculated assuming (i)
the weighted average diluted shares outstanding of class A common
stock and (ii) as if all shares of class B common stock were
converted to shares of class A common stock as of January 1,
2022.
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 any 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 December
31,
Year Ended December
31,
2023
2022
2023
2022
Net revenue
$
616,981
$
609,759
$
2,393,607
$
2,212,304
Cost of goods sold
427,154
394,371
1,573,042
1,427,596
Gross profit
189,827
215,388
820,565
784,708
Selling, general and administrative
109,003
102,158
429,675
399,700
Research and development
46,086
41,907
163,950
195,688
In-process research and development
impairment charges
30,800
12,970
30,800
12,970
Intellectual property legal development
expenses
478
1,362
3,828
4,358
Acquisition, transaction-related and
integration (credit) expenses
—
(5
)
—
709
Restructuring and other charges
114
109
1,749
1,421
Change in fair value of contingent
consideration
(13,710
)
2,226
(14,497
)
731
Insurance recoveries for property losses
and associated expenses, net
—
—
—
(1,911
)
Charges related to legal matters, net
2,863
20,094
1,824
269,930
Other operating income
—
(1,465
)
(1,138
)
(3,960
)
Operating income (loss)
14,193
36,032
204,374
(94,928
)
Other (expense) income:
Interest expense, net
(59,548
)
(47,028
)
(210,629
)
(158,377
)
Foreign exchange gain (loss), net
2,288
569
1,671
(12,364
)
Loss on refinancing
(40,805
)
—
(40,805
)
(291
)
Other income, net
411
2,772
5,119
17,833
Total other expense, net
(97,654
)
(43,687
)
(244,644
)
(153,199
)
Loss before income taxes
(83,461
)
(7,655
)
(40,270
)
(248,127
)
Provision for (benefit from) income
taxes
9,883
(1,797
)
8,452
6,662
Net loss
(93,344
)
(5,858
)
(48,722
)
(254,789
)
Less: Net (income) loss attributable to
non-controlling interests
(5,305
)
1,525
(35,271
)
125,241
Net loss attributable to Amneal
Pharmaceuticals, Inc. before accretion of redeemable
non-controlling interest
(98,649
)
(4,333
)
(83,993
)
(129,548
)
Accretion of redeemable non-controlling
interest
—
—
—
(438
)
Net loss attributable to Amneal
Pharmaceuticals, Inc.
$
(98,649
)
$
(4,333
)
$
(83,993
)
$
(129,986
)
Net loss per share attributable to
Amneal Pharmaceuticals, Inc.'s Class A common stockholders:
Basic and diluted
$
(0.40
)
$
(0.03
)
$
(0.48
)
$
(0.86
)
Weighted-average common shares
outstanding:
Basic and diluted
243,711
151,476
176,136
150,944
Amneal Pharmaceuticals,
Inc. Condensed Consolidated Balance Sheets
(unaudited; in thousands)
December 31,
2023
December 31,
2022
Assets
Current assets:
Cash and cash equivalents
$
91,542
$
25,976
Restricted cash
7,565
9,251
Trade accounts receivable, net
613,732
741,791
Inventories
581,384
530,735
Prepaid expenses and other current
assets
82,685
103,565
Related party receivables
955
500
Total current assets
1,377,863
1,411,818
Property, plant and equipment, net
447,574
469,815
Goodwill
598,629
598,853
Intangible assets, net
890,423
1,096,093
Operating lease right-of-use assets
30,329
38,211
Operating lease right-of-use assets -
related party
12,954
17,910
Financing lease right-of-use assets
59,280
63,424
Other assets
55,517
103,217
Total assets
$
3,472,569
$
3,799,341
Liabilities and Stockholders’
Equity
Current liabilities:
Accounts payable and accrued expenses
$
534,662
$
538,199
Current portion of liabilities for legal
matters
76,988
107,483
Revolving credit facility
179,000
60,000
Current portion of long-term debt, net
34,125
29,961
Current portion of operating lease
liabilities
9,207
8,321
Current portion of operating lease
liabilities - related party
2,825
2,869
Current portion of financing lease
liabilities
2,467
3,488
Related party payables - short term
7,321
2,479
Total current liabilities
846,595
752,800
Long-term debt, net
2,386,004
2,591,981
Note payable - related party
41,447
39,706
Operating lease liabilities
24,095
32,126
Operating lease liabilities - related
party
12,787
15,914
Financing lease liabilities
58,566
60,769
Related party payable - long term
11,776
9,649
Other long-term liabilities
29,995
87,468
Total long-term liabilities
2,564,670
2,837,613
Redeemable non-controlling interests
41,293
24,949
Total stockholders' equity
20,011
183,979
Total liabilities and stockholders'
equity
$
3,472,569
$
3,799,341
Amneal Pharmaceuticals,
Inc. Consolidated Statements of Cash Flows
(unaudited; in thousands)
Years Ended December
31,
2023
2022
Cash flows from operating
activities:
Net loss
$
(48,722
)
$
(254,789
)
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization
229,400
240,175
Unrealized foreign currency (gain)
loss
(768
)
15,190
Amortization of debt issuance costs and
discount
8,182
8,595
Loss on refinancing
40,805
291
Intangible asset impairment charges
66,932
24,081
Change in fair value of contingent
consideration
(14,497
)
731
Stock-based compensation
26,822
31,847
Inventory provision
74,686
51,096
Insurance recoveries for property and
equipment losses
—
(1,000
)
Other operating charges and credits,
net
9,923
8,828
Changes in assets and liabilities:
Trade accounts receivable, net
126,289
(79,717
)
Inventories
(126,182
)
(102,396
)
Prepaid expenses, other current assets and
other assets
37,814
9,882
Related party receivables
(490
)
646
Accounts payable, accrued expenses and
other liabilities
(94,446
)
109,568
Related party payables
9,829
2,072
Net cash provided by operating
activities
345,577
65,100
Cash flows from investing
activities:
Purchases of property, plant and
equipment
(43,216
)
(46,407
)
Acquisition of intangible assets
(22,388
)
(41,800
)
Deposits for future acquisition of
property, plant, and equipment
(3,585
)
(2,388
)
Acquisition of business
—
(84,714
)
Proceeds from insurance recoveries for
property and equipment losses
—
1,000
Net cash used in investing activities
(69,189
)
(174,309
)
Cash flows from financing
activities:
Payments of deferred financing and
refinancing costs
(162,415
)
(1,663
)
Payments of principal on debt, revolving
credit facility, financing leases and other
(414,080
)
(123,272
)
Proceeds from issuance of debt
217,732
—
Borrowings on revolving credit
facility
219,000
85,000
Proceeds from exercise of stock
options
451
662
Employee payroll tax withholding on
restricted stock unit vesting
(2,378
)
(3,571
)
Payments of deferred consideration for
acquisitions - related party
—
(44,498
)
Acquisition of redeemable non-controlling
interests
—
(1,722
)
Tax distributions to non-controlling
interest
(70,883
)
(17,556
)
Net cash used in financing activities
(212,573
)
(106,620
)
Effect of foreign exchange rate on
cash
65
(5,683
)
Net increase (decrease) in cash, cash
equivalents, and restricted cash
63,880
(221,512
)
Cash, cash equivalents, and restricted
cash - beginning of period
35,227
256,739
Cash, cash equivalents, and restricted
cash - end of period
$
99,107
$
35,227
Cash and cash equivalents - end of
period
$
91,542
$
25,976
Restricted cash - end of period
$
7,565
$
9,251
Cash, cash equivalents, and restricted
cash - end of period
$
99,107
$
35,227
Amneal Pharmaceuticals,
Inc. Non-GAAP Reconciliations (unaudited, in
thousands)
Reconciliation of Net Loss to
EBITDA and Adjusted EBITDA
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
Net loss
$
(93,344
)
$
(5,858
)
$
(48,722
)
$
(254,789
)
Adjusted to add (deduct):
Interest expense, net
59,548
47,028
210,629
158,377
Provision for (benefit from) income
taxes
9,883
(1,797
)
8,452
6,662
Depreciation and amortization
56,933
61,056
229,400
240,175
EBITDA (Non-GAAP)
$
33,020
$
100,429
$
399,759
$
150,425
Adjusted to add (deduct):
Stock-based compensation expense
5,974
7,831
26,822
31,847
Acquisition, site closure, and idle
facility expenses (1)
1,186
3,452
7,017
15,682
Restructuring and other charges
114
109
1,650
1,378
Loss on refinancing
40,805
—
40,805
291
Charges related to legal matters, net
(2)
2,863
20,094
11,824
269,930
Asset impairment charges (3)
67,228
18,551
70,107
26,909
Foreign exchange (gain) loss
(2,288
)
(569
)
(1,671
)
12,364
Change in fair value of contingent
consideration
(13,710
)
2,226
(14,497
)
731
Insurance recoveries for property losses
and
associated expenses
—
—
—
(1,911
)
Regulatory approval milestone
—
—
—
5,000
Increase in tax receivable agreement
liability
1,217
631
3,124
631
System implementation expense (4)
934
727
5,363
2,818
Reorganization expenses(5)
4,630
—
5,927
393
Other
175
551
1,984
(2,378
)
Adjusted EBITDA (Non-GAAP)
$
142,148
$
154,032
$
558,214
$
514,110
Amneal Pharmaceuticals,
Inc.
Non-GAAP
Reconciliations
(unaudited; in thousands,
except per share amounts)
Reconciliation of Net Loss to
Adjusted Net Income and Calculation of Adjusted Diluted Earnings
per Share
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
Net loss
$
(93,344
)
$
(5,858
)
$
(48,722
)
$
(254,789
)
Adjusted to add (deduct):
Non-cash interest
1,016
1,885
7,017
7,715
GAAP provision for (benefit from) income
taxes
9,883
(1,797
)
8,452
6,662
Amortization
39,208
42,851
157,219
164,997
Stock-based compensation expense
5,974
7,831
26,822
31,847
Acquisition, site closure expenses, and
idle facility
expenses (1)
1,186
3,452
7,017
15,682
Restructuring and other charges
114
109
1,650
1,378
Loss on refinancing
40,805
—
40,805
291
Charges related to legal matters,
including interest,
net (2)
3,580
21,564
14,784
273,226
Asset impairment charges (3)
67,143
18,485
70,015
26,843
Regulatory approval milestone
—
—
—
5,000
Change in fair value of contingent
consideration
(13,710
)
2,226
(14,497
)
731
Insurance recoveries for property losses
and
associated expenses
—
—
—
(1,911
)
Increase in tax receivable agreement
liability
1,217
631
3,124
631
System implementation expense (4)
934
727
5,363
2,818
Reorganization expenses (5)
4,630
—
5,927
393
Other
323
552
2,466
(2,235
)
Provision for income taxes (6)
(17,563
)
(15,297
)
(60,014
)
(56,450
)
Net income attributable to non-controlling
interests
not associated with our class B common
stock
(7,831
)
(5,958
)
(29,873
)
(15,121
)
Adjusted net income (Non-GAAP)
$
43,565
$
71,403
$
197,555
$
207,708
Weighted average diluted shares
outstanding (Non-GAAP) (7)
314,986
305,145
310,234
304,598
Adjusted diluted earnings per share
(Non-GAAP)
$
0.14
$
0.23
$
0.64
$
0.68
Amneal Pharmaceuticals,
Inc. Non-GAAP Reconciliations (unaudited)
Explanations for
Reconciliations of Net Loss to EBITDA and Adjusted EBITDA and
Net Loss to Adjusted Net Income and Calculation of Adjusted
Diluted Earnings per Share
(1)
Acquisition, site closure, and idle facility expenses for the
three months and year ended December 31, 2023 primarily included
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
December 31, 2022 primarily included site closure costs associated
with the planned cessation of manufacturing at our Hauppauge, NY
facility. Acquisition, site closure, and idle facility expenses for
the year ended December 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, which closed on February 9, 2022; (ii)
integration costs associated with the acquisition of Puniska
Healthcare Pvt. Ltd., which closed on November 2, 2021; and (iii)
site closure costs associated with the planned cessation of
manufacturing at our Hauppauge, NY facility.
(2)
For the three months ended December 31, 2023, charges related to
legal matters, net were primarily comprised of a settlement of
commercial antitrust litigation. For the year ended December 31,
2023, charges related to legal matters, net were primarily
comprised of (i) charges associated with civil prescription opioid
litigation, (ii) a settlement of a customer claim, (iii) a
settlement of commercial antitrust litigation, and (iv) a
settlement of a stockholder derivative lawsuit. For the three
months ended December 31, 2022, charges related to legal matters,
net primarily related to prescription opioid litigation. For the
year ended December 31, 2022, charges related to legal matters,
net, primarily included charges for (i) the settlements of the
Opana ER® antitrust litigation and (ii) prescription opioid
litigation, offset in part by insurance recoveries associated with
class action shareholder lawsuits.
(3)
Asset impairment charges for the three months and year ended
December 31, 2023 were primarily associated with the write-offs of
intangibles assets. Asset impairment charges for the three months
and year ended December 31, 2022 were associated with the
write-offs of intangibles assets and equipment.
(4)
System implementation expense for the three months ended
December 31, 2023 was primarily for the implementation of sales
deduction software and indirect procurement software. System
implementation expense for the three months ended December 31, 2022
was primarily for indirect procurement software. System
implementation expense for the years ended December 31, 2023 and
2022 was primarily for the implementation of indirect procurement
software, sales deduction software, and financial statement
consolidation software. System implementation expenses were
associated with the further integration of our acquired
businesses.
(5)
On November 7, 2023, the Company implemented a plan to
reorganize and simplify its corporate structure by eliminating its
umbrella partnership-C-corporation structure and converting to a
more traditional C-corporation structure, whereby all stockholders
hold their voting and economic interests directly through the
public company (“Reorganization”). For the three months ended
December 31, 2023 and the years ended December 31, 2023 and 2022,
Reorganization expenses were comprised of professional
fees.
(6)
The non-GAAP effective tax rates for the three months and year
ended December 31, 2023 were 28.7% and 23.3%, respectively. The
non-GAAP effective tax rates for the three months and year ended
December 31, 2022 were 17.6% and 21.4%, respectively.
(7)
Weighted average diluted shares outstanding consisted of class A
common stock and class B common stock, as if all shares of class B
common stock were converted to class A common stock as of January
1, 2022.
Amneal Pharmaceuticals,
Inc. Generics Segment
Reconciliation of GAAP to
Non-GAAP Operating Results (1) (unaudited; $ in
thousands)
Three Months Ended December
31, 2023
Three Months Ended December
31, 2022
As Reported
Adjustments
Non-GAAP
As Reported
Adjustments
Non-GAAP
Net revenue
$
363,037
$
—
$
363,037
$
399,165
$
—
$
399,165
Cost of goods sold (2)
221,861
(14,167
)
207,694
249,795
(16,875
)
232,920
Gross profit
141,176
14,167
155,343
149,370
16,875
166,245
Gross margin %
38.9
%
42.8
%
37.4
%
41.6
%
Selling, general and administrative
(3)
30,734
(1,849
)
28,885
25,371
(1,319
)
24,052
Research and development (4)
33,663
(654
)
33,009
38,127
(1,112
)
37,015
In-process research and development
impairment charges
26,500
(26,500
)
—
12,970
(12,970
)
—
Intellectual property legal development
expenses
468
—
468
1,332
—
1,332
Acquisition, transaction-related and
integration expenses
—
—
—
1
(1
)
—
Restructuring and other charges
—
—
—
108
(108
)
—
Charges related to legal matters, net
2,863
(2,863
)
—
19,958
(19,958
)
—
Other operating income
—
—
—
(1,465
)
—
(1,465
)
Operating income
$
46,948
$
46,033
$
92,981
$
52,968
$
52,343
$
105,311
(1)
Operating results for the sale of Amneal products by AvKARE were
included in our Generics segment.
(2)
Adjustments for the three months ended December 31, 2023 and
2022, respectively, were comprised of stock-based compensation
expense ($0.6 million and $1.2 million), amortization
expense ($10.7 million and $12.4 million), site closure
and idle facility expenses ($0.7 million and
$2.7 million), asset impairment charges ($2.3 million and $0.3
million), and other ($(0.1) million and $0.3 million).
(3)
Adjustments for the three months ended December 31, 2023 and
2022, respectively, were comprised of stock-based compensation
expense ($1.2 million and $0.5 million) and site closure
costs ($0.6 million and $0.8 million).
(4)
Adjustments for the three months ended December 31, 2023 and
2022 were comprised of stock-based compensation expense.
Amneal Pharmaceuticals,
Inc.
Generics Segment
Reconciliation of GAAP to
Non-GAAP Operating Results (1)
(unaudited; $ in
thousands)
Year Ended December 31,
2023
Year Ended December 31,
2022
As Reported
Adjustments
Non-GAAP
As Reported
Adjustments
Non-GAAP
Net revenue
$
1,471,401
$
—
$
1,471,401
$
1,432,073
$
—
$
1,432,073
Cost of goods sold (2)
913,869
(56,450
)
857,419
896,031
(70,080
)
825,951
Gross profit
557,532
56,450
613,982
536,042
70,080
606,122
Gross margin %
37.9
%
41.7
%
37.4
%
42.3
%
Selling, general and administrative
(3)
119,912
(7,411
)
112,501
109,781
(9,960
)
99,821
Research and development (4)
132,233
(2,555
)
129,678
167,509
(4,819
)
162,690
In-process research and development
impairment charges
26,500
(26,500
)
—
12,970
(12,970
)
—
Intellectual property legal development
expenses
3,708
—
3,708
4,251
—
4,251
Acquisition, transaction-related and
integration expenses
—
—
—
25
(25
)
—
Restructuring and other charges
211
(112
)
99
821
(821
)
—
Insurance recoveries for property losses
and associated expenses, net
—
—
—
(1,911
)
1,911
—
(Credit) charges related to legal matters,
net
(64
)
(9,936
)
(10,000
)
22,400
(22,400
)
—
Other operating income
(1,138
)
—
(1,138
)
(3,960
)
—
(3,960
)
Operating income
$
276,170
$
102,964
$
379,134
$
224,156
$
119,164
$
343,320
(1)
Operating results for the sale of Amneal products by AvKARE were
included in our Generics segment.
(2)
Adjustments for the years ended December 31, 2023 and 2022,
respectively, were comprised of stock-based compensation expense
($3.5 million and $4.8 million), amortization expense ($42.8
million and $44.2 million), site closure and idle facility
expenses ($4.9 million and $12.5 million), asset
impairment charges ($5.2 million and $8.6 million), and other
($0.1 million and none).
(3)
Adjustments for the years ended December 31, 2023 and 2022,
respectively, were comprised of stock-based compensation expense
($5.2 million, and $2.5 million), site closure expenses
($2.2 million and $2.5 million), and a regulatory
approval milestone (none and $5.0 million).
(4)
Adjustments for the years ended December 31, 2023 and 2022 were
comprised of stock-based compensation expense.
Amneal Pharmaceuticals,
Inc.
Specialty Segment
Reconciliation of GAAP to
Non-GAAP Operating Results
(unaudited; $ in
thousands)
Three Months Ended December
31, 2023
Three Months Ended December
31, 2022
As Reported
Adjustments
Non-GAAP
As Reported
Adjustments
Non-GAAP
Net revenue
$
104,481
$
—
$
104,481
$
102,550
$
—
$
102,550
Cost of goods sold (1)
79,023
(59,940
)
19,083
52,069
(32,652
)
19,417
Gross profit
25,458
59,940
85,398
50,481
32,652
83,133
Gross margin %
24.4
%
81.7
%
49.2
%
81.1
%
Selling, general and administrative
(2)
20,243
(39
)
20,204
20,259
(119
)
20,140
Research and development (2)
12,423
(451
)
11,972
3,780
(372
)
3,408
In-process research and development
impairment charges
4,300
(4,300
)
—
—
—
—
Intellectual property legal development
expenses
10
—
10
30
—
30
Acquisition, transaction-related and
integration expenses
—
—
—
2
(2
)
—
Restructuring and other charges
92
(92
)
—
—
—
—
Change in fair value of contingent
consideration (3)
(13,710
)
13,710
—
2,226
(2,226
)
—
Operating income
$
2,100
$
51,112
$
53,212
$
24,184
$
35,371
$
59,555
(1)
Adjustments for the three months ended December 31, 2023
and 2022, respectively, were comprised of amortization expense
($25.8 million and $27.4 million) and asset impairment charges
($34.1 million and $5.3 million).
(2)
Adjustments for the three months ended December 31, 2023
and 2022 were comprised of stock-based compensation expense.
(3)
Contingent consideration was recorded in connection with the
acquisitions of (i) the baclofen franchise from certain entities
affiliated with Saol International Limited and (ii) Kashiv
Specialty Pharmaceuticals, LLC.
Amneal Pharmaceuticals,
Inc.
Specialty Segment
Reconciliation of GAAP to
Non-GAAP Operating Results
(unaudited; $ in
thousands)
Year Ended December 31,
2023
Year Ended December 31,
2022
As Reported
Adjustments
Non-GAAP
As Reported
Adjustments
Non-GAAP
Net revenue
$
390,457
$
—
$
390,457
$
374,121
$
—
$
374,121
Cost of goods sold (1)
214,277
(137,811
)
76,466
182,432
(113,512
)
68,920
Gross profit
176,180
137,811
313,991
191,689
113,512
305,201
Gross margin %
45.1
%
80.4
%
51.2
%
81.6
%
Selling, general and administrative
(2)
88,137
(688
)
87,449
90,031
(913
)
89,118
Research and development (2)
31,717
(1,785
)
29,932
28,179
(1,471
)
26,708
In-process research and development
impairment charges
4,300
(4,300
)
—
—
—
—
Intellectual property legal development
expenses
120
—
120
107
—
107
Acquisition, transaction-related and
integration expenses
—
—
—
49
(49
)
—
Restructuring and other charges
1,105
(1,105
)
—
—
—
—
Change in fair value of contingent
consideration (3)
(14,497
)
14,497
—
731
(731
)
—
Operating income
$
65,298
$
131,192
$
196,490
$
72,592
$
116,676
$
189,268
(1)
Adjustments for the years ended December 31, 2023 and 2022,
respectively, were comprised of amortization expense
($103.7 million and $108.2 million) and asset impairment
charges ($34.1 million and $5.3 million).
(2)
Adjustments for the years ended December 31, 2023 and 2022
were comprised of stock-based compensation expense.
(3)
Contingent consideration was recorded in connection with the
acquisitions of (i) the baclofen franchise from certain entities
affiliated with Saol International Limited and (ii) Kashiv
Specialty Pharmaceuticals, LLC.
Amneal Pharmaceuticals,
Inc.
AvKARE Segment
Reconciliation of GAAP to
Non-GAAP Operating Results (1)
(unaudited; $ in
thousands)
Three Months Ended December
31, 2023
Three Months Ended December
31, 2022
As Reported
Adjustments
Non-GAAP
As Reported
Adjustments
Non-GAAP
Net revenue
$
149,463
$
—
$
149,463
$
108,044
$
—
$
108,044
Cost of goods sold
126,270
—
126,270
92,507
—
92,507
Gross profit
23,193
—
23,193
15,537
—
15,537
Gross margin %
15.5
%
15.5
%
14.4
%
14.4
%
Selling, general and administrative
(2)
14,073
(3,764
)
10,309
14,298
(4,932
)
9,366
Operating income
$
9,120
$
3,764
$
12,884
$
1,239
$
4,932
$
6,171
(1)
Operating results for the sale of Amneal products by AvKARE were
included in our Generics segment.
(2)
Adjustments for the three months ended December 31, 2023
and 2022, respectively, were comprised of amortization expense
($4.2 million and $4.9 million) and other ($(0.4) million and
none).
Amneal Pharmaceuticals,
Inc.
AvKARE Segment
Reconciliation of GAAP to
Non-GAAP Operating Results (1)
(unaudited; $ in
thousands)
Year Ended December 31,
2023
Year Ended December 31,
2022
As Reported
Adjustments
Non-GAAP
As Reported
Adjustments
Non-GAAP
Net revenue
$
531,749
$
—
$
531,749
$
406,110
$
—
$
406,110
Cost of goods sold
444,896
—
444,896
349,133
—
349,133
Gross profit
86,853
—
86,853
56,977
—
56,977
Gross margin %
16.3
%
16.3
%
14.0
%
14.0
%
Selling, general and administrative
(2)
55,341
(15,373
)
39,968
53,659
(19,324
)
34,335
Operating income
$
31,512
$
15,373
$
46,885
$
3,318
$
19,324
$
22,642
(1)
Operating results for the sale of Amneal products by AvKARE were
included in our Generics segment.
(2)
Adjustments for the years ended December 31, 2023 and 2022,
respectively, were comprised of amortization ($16.8 million and
$19.7 million) and other ($(1.4) million and $(0.4) million).
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240301034971/en/
Anthony DiMeo Head of Investor Relations
anthony.dimeo@amneal.com
Amneal Pharmaceuticals (NYSE:AMRX)
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