Mallinckrodt plc Reports Third Quarter 2024 Financial Results and Raises Full Year Guidance
Mallinckrodt reported Q3 2024 net sales of $505.5 million, up 1.7% year-over-year. The company raised its full-year Adjusted EBITDA guidance to $590-620 million while reaffirming net sales guidance of $1.9-2.0 billion. Acthar Gel achieved its third consecutive quarter of growth, with sales up 3.5% to $126.4 million, leading to expectations of approximately 10% growth for full-year 2024. The Specialty Generics segment reported 4.1% growth to $219.5 million. The company expects to reduce net debt by more than 60% in Q4 following the sale of Therakos business for $925 million to CVC Capital Partners.
Mallinckrodt ha riportato vendite nette per il terzo trimestre del 2024 pari a 505,5 milioni di dollari, con un incremento dell'1,7% rispetto all'anno precedente. L'azienda ha alzato le previsioni per l'EBITDA rettificato dell'intero anno a 590-620 milioni di dollari, mentre ha confermato le stime di vendite nette tra 1,9 e 2,0 miliardi di dollari. Acthar Gel ha registrato il suo terzo trimestre consecutivo di crescita, con vendite in aumento del 3,5% a 126,4 milioni di dollari, portando a previsioni di una crescita di circa il 10% per l'intero anno 2024. Il segmento dei Generics Speciali ha riportato una crescita del 4,1% a 219,5 milioni di dollari. L'azienda prevede di ridurre il debito netto di oltre il 60% nel quarto trimestre a seguito della vendita dell'attività Therakos per 925 milioni di dollari a CVC Capital Partners.
Mallinckrodt reportó ventas netas en el tercer trimestre de 2024 de 505,5 millones de dólares, un aumento del 1,7% en comparación con el año anterior. La empresa elevó su guía de EBITDA ajustado para todo el año a 590-620 millones de dólares, mientras que reafirmó la guía de ventas netas de 1,9-2,0 mil millones de dólares. Acthar Gel alcanzó su tercer trimestre consecutivo de crecimiento, con ventas que aumentaron un 3,5% a 126,4 millones de dólares, lo que anticipa un crecimiento de aproximadamente el 10% para todo el año 2024. El segmento de Genéricos Especiales informó un crecimiento del 4,1% hasta 219,5 millones de dólares. Se espera que la empresa reduzca su deuda neta en más del 60% en el cuarto trimestre tras la venta del negocio Therakos por 925 millones de dólares a CVC Capital Partners.
말린크로드는 2024년 3분기 순매출이 5억 550만 달러로 전년 대비 1.7% 증가했다고 보고했습니다. 회사는 연간 조정 EBITDA 가이드를 5억 9000만~6억 2000만 달러로 상향 조정했으며, 순매출 가이드는 19억~20억 달러를 reaffirm했습니다. 액타르 젤은 3분기 연속 성장을 기록했으며, 매출은 3.5% 증가하여 1억 2640만 달러에 이르렀고, 2024년 전체 연도에 대해 약 10%의 성장이 예상됩니다. 전문 제네릭 부문은 4.1% 성장하여 2억 1950만 달러에 달했습니다. 회사는 테라코스 사업을 CVC 캐피탈 파트너스에 9억 2500만 달러에 매각한 후 4분기에 순부채를 60% 이상 줄일 것으로 예상하고 있습니다.
Mallinckrodt a rapporté des ventes nettes pour le troisième trimestre 2024 s'élevant à 505,5 millions de dollars, soit une augmentation de 1,7% par rapport à l'année précédente. L'entreprise a relevé ses prévisions d'EBITDA ajusté pour l'année entière à 590-620 millions de dollars tout en réaffirmant ses prévisions de ventes nettes entre 1,9 et 2,0 milliards de dollars. Acthar Gel a réalisé son troisième trimestre consécutif de croissance, avec des ventes en hausse de 3,5% à 126,4 millions de dollars, ce qui conduit à des prévisions d'une croissance d'environ 10% pour l'année entière 2024. Le segment des Génériques Spécialisés a rapporté une croissance de 4,1% à 219,5 millions de dollars. L'entreprise s'attend à réduire sa dette nette de plus de 60% au quatrième trimestre à la suite de la vente de son activité Therakos pour 925 millions de dollars à CVC Capital Partners.
Mallinckrodt berichtete im 3. Quartal 2024 von einem Nettoumsatz von 505,5 Millionen US-Dollar, was einem Anstieg von 1,7% im Jahresvergleich entspricht. Das Unternehmen hob die Prognose für das bereinigte EBITDA auf 590-620 Millionen US-Dollar an und bestätigte gleichzeitig die Umsatzprognose von 1,9-2,0 Milliarden US-Dollar. Acthar Gel verzeichnete das dritte aufeinanderfolgende Quartal mit Wachstum, mit einem Umsatzanstieg von 3,5% auf 126,4 Millionen US-Dollar, was zu einer Erwartung von rund 10% Wachstum für das gesamte Jahr 2024 führt. Der Bereich der Spezial-Generika meldete ein Wachstum von 4,1% auf 219,5 Millionen US-Dollar. Das Unternehmen erwartet, die Nettoverschuldung im 4. Quartal um mehr als 60% zu reduzieren, nachdem das Geschäft mit Therakos für 925 Millionen US-Dollar an CVC Capital Partners verkauft wurde.
- Net sales increased 1.7% YoY to $505.5 million
- Acthar Gel sales grew 3.5% to $126.4 million
- Specialty Generics segment achieved seventh consecutive quarter of growth, up 4.1%
- Therakos sale for $925 million will reduce net debt by over 60%
- Raised full-year Adjusted EBITDA guidance
- Net loss of $26.2 million in Q3
- Adjusted EBITDA decreased 11.1% to $160.6 million
- INOmax sales declined 12.2% due to competitive pressures
- Transaction-related compensation expenses of $7.3 million impacted earnings
Insights
The Q3 results and guidance update reveal several significant developments. Net sales of
The Specialty Generics segment continues to perform well with seven consecutive quarters of growth, while the Specialty Brands segment faces some headwinds from INOmax competition. The raised Adjusted EBITDA guidance, even after accounting for the Therakos sale impact, suggests improving operational efficiency. The company's debt reduction strategy through the Therakos sale demonstrates strong financial management.
The market positioning shows strategic improvements across key segments. The successful launch of Acthar Gel SelfJect and expanded rollout of INOmax EVOLVE DS delivery system represent important product innovations. The Specialty Generics segment's consistent growth amid market shortages highlights the company's strong market position as a reliable supplier.
The Therakos divestiture, generating
Achieves Third Quarter Net Sales of
Reaffirms Full Year Net Sales Guidance and Raises Full Year Adjusted EBITDA Guidance After Adjusting Both Metrics for the Therakos Transaction
Delivers Third Consecutive Quarter of Acthar® Gel Growth, Underscoring Increase in Patient and Prescriber Demand; Expects Brand to Grow Approximately
Successfully Launched Acthar Gel SelfJect™ Device and Expanded the Rollout of INOmax® EVOLVE™ DS Delivery System to
Specialty Generics Segment Maintains Momentum with Seventh Consecutive Quarter of Year-Over-Year Growth
Net Proceeds from Sale of Therakos® Business Expected to Reduce Net Debt by More Than
"Our third quarter results demonstrate the successful execution of our strategy to stabilize the base business and position Mallinckrodt for long-term growth. We are pleased to reaffirm our full year net sales guidance and again raise our Adjusted EBITDA guidance, even after adjusting for the Therakos transaction," said Siggi Olafsson, President and Chief Executive Officer. "In Specialty Brands, Acthar Gel achieved its third consecutive quarter of growth from rising prescriber referrals and patient demand. We also made important progress on our recent launches, with positive momentum in our Acthar Gel SelfJect device and an expanded rollout of our INOmax EVOLVE DS delivery system to
Mr. Olafsson added, "I am grateful to our teams for their continued commitment to Mallinckrodt, bringing our strategy to life and serving our patients. It is because of their efforts that we are positioned to finish 2024 on a strong note as we continue building on our momentum and advancing our strategic priorities."
Third Quarter 2024 Financial Results1
Mallinckrodt's net sales in the third quarter of 2024 were
The Company's Specialty Brands segment reported net sales of
Mallinckrodt's Specialty Generics segment reported net sales of
The Company's net loss for the third quarter was
Mallinckrodt's Adjusted EBITDA in the third quarter was
Gross profit as a percentage of net sales was
Mallinckrodt's cash balance at the end of the third quarter of 2024 was
Nine Month 2024 Results1
Mallinckrodt's net sales were
The Company recorded a net loss of
Mallinckrodt's Adjusted EBITDA was
Third Quarter 2024 Business Segment Update
Specialty Brands
Acthar Gel net sales were
Terlivaz net sales were
INOmax (nitric oxide) gas net sales in the third quarter were
Therakos net sales were
As previously announced, the Company entered into a definitive agreement to sell the Therakos business to CVC Capital Partners for
Specialty Generics
The Specialty Generics segment reported year-over-year net sales growth of
Net sales in the Specialty Generics segment have grown for the past seven quarters, and its third quarter performance is particularly notable given the strong comparable quarter in 2023, which was driven by the launch of lisdexamfetamine dimesylate capsules (generic form of Vyvanse®).
Please see "Non-GAAP Financial Measures" included in this release for a discussion of non-GAAP measures and reconciliation of GAAP and non-GAAP financial measures for the third quarter.
Please see the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of the Company's Quarterly Report on Form 10-Q for the quarter ended September 27, 2024 to be filed with the
2024 Financial Guidance Update
Mallinckrodt today reaffirmed its net sales guidance and raised its Adjusted EBITDA guidance for full year 2024.
The Company's updated guidance assumes that the Therakos transaction will close by the end of November and, accordingly, removes approximately
The Company's updated guidance is as follows:
Updated 2024 Guidance | Prior 2024 Guidance | |
Total Net Sales | | |
Adjusted EBITDA | |
Mallinckrodt notes that for full year 2024 Therakos is expected to generate approximately
The Company does not provide the comparable GAAP measures for its forward-looking non-GAAP guidance or a reconciliation of such measures because the reconciling items described in the definition of Adjusted EBITDA provided below are inherently uncertain and difficult to estimate and cannot be predicted without unreasonable effort. The variability of such items may have a significant impact on our future GAAP results.
1 As a result of emerging from Chapter 11, the three and nine months ended September 29, 2023 reflect the Predecessor period, while the three and nine months ended September 27, 2024 reflect the Successor period. Please see "Predecessor and Successor Periods" below for further information. |
Conference Call and Webcast
Mallinckrodt will hold a conference call today, November 5, 2024, at 8:30 a.m. Eastern Time to discuss its financial results and performance for the third quarter 2024. The live call and subsequent replay can be accessed as follows:
- Live Call Participant Registration (including dial-in): https://register.vevent.com/register/BI60bb36abdb99465c9db5640f3457528a
- Audio Only Webcast Link (live and replay): https://edge.media-server.com/mmc/p/6tqaksqg/
- At the Mallinckrodt website: https://ir.mallinckrodt.com/
About Mallinckrodt
Mallinckrodt is a global business consisting of multiple wholly owned subsidiaries that develop, manufacture, market and distribute specialty pharmaceutical products and therapies. The Company's Specialty Brands reportable segment's areas of focus include autoimmune and rare diseases in specialty areas like neurology, rheumatology, hepatology, nephrology, pulmonology, ophthalmology and oncology; immunotherapy and neonatal respiratory critical care therapies; analgesics; and gastrointestinal products. Its Specialty Generics reportable segment includes specialty generic drugs and active pharmaceutical ingredients. To learn more about Mallinckrodt, visit www.mallinckrodt.com.
Mallinckrodt uses its website as a channel of distribution of important company information, such as press releases, investor presentations and other financial information. It also uses its website to expedite public access to time-critical information regarding the Company in advance of or in lieu of distributing a press release or a filing with the SEC disclosing the same information. Therefore, investors should look to the Investor Relations page of the website for important and time-critical information. Visitors to the website can also register to receive automatic e-mail and other notifications alerting them when new information is made available on the Investor Relations page of the website.
NON-GAAP FINANCIAL MEASURES
This press release contains financial measures, including Adjusted EBITDA, adjusted gross profit, adjusted selling, general, and administrative ("SG&A") expenses, adjusted research and development ("R&D") expenses, net sales growth (loss) on a constant-currency basis, and net debt, which are considered "non-GAAP" financial measures under applicable SEC rules and regulations.
Adjusted EBITDA represents net income or loss prepared in accordance with accounting principles generally accepted in the
The Company has forecasted a full-year 2024 adjusted EBITDA for Therakos, consistent with the Company's calculation of the consolidated Company Adjusted EBITDA. As such, certain amounts that management considers to be non-recurring or non-operational are excluded from these measures because management and the chief operating decision maker evaluate the operating results of the excluding such items. These items may include, but are not limited to, depreciation and amortization, share-based compensation, net restructuring charges, non-restructuring impairment charges and liabilities management and separation costs. Also, Therakos Adjusted EBITDA excludes allocations of intercompany corporate overhead costs and fresh-start inventory related expenses and other items identified by the Company.
Adjusted gross profit, adjusted SG&A expenses and adjusted R&D expenses represent amounts prepared in accordance with GAAP, adjusted for certain items that management believes are not reflective of the operational performance of the business. Adjustments to GAAP amounts include, as applicable to each measure, the aforementioned items in the Adjusted EBITDA paragraph. The adjustments for these items are on a pre-tax basis for adjusted gross profit and adjusted SG&A expenses.
Segment net sales growth (loss) on a constant-currency basis measures the change in segment net sales between current- and prior-year periods using a constant currency, the exchange rate in effect during the applicable prior-year period.
Net debt of
The Company has provided these adjusted financial measures because they are used by management, along with financial measures in accordance with GAAP, to evaluate the Company's operating performance and liquidity. In addition, the Company believes that they will be used by investors to measure Mallinckrodt's operating results. Management believes that presenting these adjusted measures provides useful information about the Company's performance across reporting periods on a consistent basis by excluding items that the Company does not believe are indicative of its core operating performance.
These adjusted measures should be considered supplemental to and not a substitute for financial information prepared in accordance with GAAP. The Company's definition of these adjusted measures may differ from similarly titled measures used by others.
Because adjusted financial measures exclude the effect of items that will increase or decrease the Company's reported results of operations, management strongly encourages investors to review the Company's unaudited condensed consolidated financial statements and publicly filed reports in their entirety. A reconciliation of certain of these historical adjusted financial measures to the most directly comparable GAAP financial measures is included in the tables accompanying this release.
Further information regarding non-GAAP financial measures can be found on the Investor Relations page of the Company's website.
Predecessor and Successor Periods
Mallinckrodt's financial results presented in this press release include Successor and Predecessor periods. The Successor period runs for the three and nine months ended September 27, 2024, while the Predecessor period is for the three and nine months ended September 29, 2023. We do not believe that reviewing the results of the Successor period in isolation would be useful in identifying trends in or reaching conclusions regarding our overall operating performance. Management believes that our key performance metrics such as net sales and segment results of operations for the three and nine months ended September 27, 2024 (Successor) provide a meaningful comparison and are useful in identifying current business trends when compared to the three and nine months ended September 29, 2023 (Predecessor).
Mallinckrodt's results of operations as reported in its unaudited condensed consolidated financial statements for the Successor and Predecessor periods are in accordance with GAAP. The comparison of the Predecessor and Successor periods for the periods presented here is not in accordance with GAAP. However, the Company believes that the comparison is useful for management and investors to assess Mallinckrodt's ongoing financial and operational performance and trends.
CAUTIONARY STATEMENTS RELATED TO FORWARD-LOOKING STATEMENTS
Statements in this press release that are not strictly historical, including statements regarding future financial condition and operating results, expected product launches, legal, economic, business, competitive and/or regulatory factors affecting Mallinckrodt's businesses, the ongoing strategic review, and any other statements regarding events or developments Mallinckrodt believes or anticipates will or may occur in the future, may be "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995, and involve a number of risks and uncertainties.
There are a number of important factors that could cause actual events to differ materially from those suggested or indicated by such forward-looking statements and you should not place undue reliance on any such forward-looking statements. These factors include risks and uncertainties related to, among other things: the parties' ability to satisfy the conditions to the divestiture of the Therakos business, including the ability to complete the divestiture on the anticipated timeline or at all; the potential impact of the divestiture on our businesses and the risk that consummating the divestiture may be more difficult, time-consuming and costly than expected; changes in Mallinckrodt's board of directors, business strategy and performance; Mallinckrodt's initiative to explore a variety of potential divestiture, financing and other transactional opportunities; the exercise of contingent value rights by the Opioid Master Disbursement Trust II (the "Trust"); Mallinckrodt's repurchases of debt securities; the liquidity, results of operations and businesses of Mallinckrodt and its subsidiaries; governmental investigations and inquiries, regulatory actions, and lawsuits, in each case related to Mallinckrodt or its officers; Mallinckrodt's contractual and court-ordered compliance obligations that, if violated, could result in penalties; historical commercialization of opioids, including compliance with and restrictions under the global settlement to resolve all opioid-related claims; matters related to Acthar Gel, including the settlement with governmental parties to resolve certain disputes and compliance with and restrictions under the related corporate integrity agreement; the ability to maintain relationships with Mallinckrodt's suppliers, customers, employees and other third parties following the emergence from the 2023 bankruptcy proceedings, as well as perceptions of the Company's increased performance and credit risks associated with its constrained liquidity position and capital structure; the possibility that Mallinckrodt may be unable to achieve its business and strategic goals even now that the emergence from the 2023 bankruptcy proceedings was successfully consummated; the non-dischargeability of certain claims against Mallinckrodt as part of the bankruptcy process; developing, funding and executing Mallinckrodt's business plan; Mallinckrodt's capital structure since its emergence from the 2023 bankruptcy proceedings; scrutiny from governments, legislative bodies and enforcement agencies related to sales, marketing and pricing practices; pricing pressure on certain of Mallinckrodt's products due to legal changes or changes in insurers' or other payers' reimbursement practices resulting from recent increased public scrutiny of healthcare and pharmaceutical costs; the reimbursement practices of governmental health administration authorities, private health coverage insurers and other third-party payers; complex reporting and payment obligations under the Medicare and Medicaid rebate programs and other governmental purchasing and rebate programs; cost containment efforts of customers, purchasing groups, third-party payers and governmental organizations; changes in or failure to comply with relevant laws and regulations; any undesirable side effects caused by Mallinckrodt's approved and investigational products, which could limit their commercial profile or result in other negative consequences; Mallinckrodt's and its partners' ability to successfully develop, commercialize or launch new products or expand commercial opportunities of existing products, including Acthar Gel (repository corticotropin injection) Single-Dose Pre-filled SelfJect™ Injector and the INOmax Evolve platform; Mallinckrodt's ability to successfully identify or discover additional products or product candidates; Mallinckrodt's ability to navigate price fluctuations; competition; Mallinckrodt's and its partners' ability to protect intellectual property rights, including in relation to ongoing and future litigation; limited clinical trial data for Acthar Gel; the timing, expense and uncertainty associated with clinical studies and related regulatory processes; product liability losses and other litigation liability; material health, safety and environmental liabilities; business development activities or other strategic transactions; attraction and retention of key personnel; the effectiveness of information technology infrastructure, including risks of external attacks or failures; customer concentration; Mallinckrodt's reliance on certain individual products that are material to its financial performance; Mallinckrodt's ability to receive sufficient procurement and production quotas granted by the
The "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of Mallinckrodt's Annual Report on Form 10-K for the fiscal year ended December 29, 2023, Quarterly Report on Form 10-Q for the quarterly period ended March 29, 2024, Quarterly Report on Form 10-Q for the quarterly period ended June 28, 2024, Quarterly Report on Form 10-Q for the quarterly period ended September 27, 2024 to be filed with the SEC, and other filings with the SEC, which are available from the SEC's website (www.sec.gov) and Mallinckrodt's (www.mallinckrodt.com), identify and describe in more detail the risks and uncertainties to which Mallinckrodt's businesses are subject. There may be other risks and uncertainties that we are unable to predict at this time or that we currently do not expect to have a material adverse effect on our business. The forward-looking statements made herein speak only as of the date hereof and Mallinckrodt does not assume any obligation to update or revise any forward-looking statement, whether as a result of new information, future events and developments or otherwise, except as required by law. Given these uncertainties, one should not put undue reliance on any forward-looking statements.
CONTACTS
Investor Relations
Derek Belz
Vice President, Investor Relations
314-654-3950
derek.belz@mnk.com
Media
Michael Freitag / Aaron Palash / Aura Reinhard / Catherine Simon
Joele Frank, Wilkinson Brimmer Katcher
212-355-4449
Mallinckrodt, the "M" brand mark and the Mallinckrodt Pharmaceuticals logo are trademarks of a Mallinckrodt company. Other brands are trademarks of a Mallinckrodt company or their respective owners. © 2024.
MALLINCKRODT PLC | ||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||
(unaudited, in millions, except per share data) | ||||||
Successor | Predecessor | |||||
Three Months | Three Months | |||||
Percent of Net sales | Percent of Net sales | |||||
Net sales | $ 505.5 | 100.0 % | $ 497.0 | 100.0 % | ||
Cost of sales | 284.4 | 56.3 | 346.2 | 69.7 | ||
Gross profit | 221.1 | 43.7 | 150.8 | 30.3 | ||
Selling, general and administrative expenses | 141.2 | 27.9 | 129.2 | 26.0 | ||
Research and development expenses | 28.2 | 5.6 | 25.7 | 5.2 | ||
Restructuring charges, net | 0.1 | — | (0.1) | — | ||
Non-restructuring impairment charges | — | — | 135.9 | 27.3 | ||
Liabilities management and separation costs | 15.2 | 3.0 | 142.1 | 28.6 | ||
Operating income (loss) | 36.4 | 7.2 | (282.0) | (56.7) | ||
Interest expense | (59.0) | (11.7) | (133.1) | (26.8) | ||
Interest income | 7.4 | 1.5 | 3.4 | 0.7 | ||
Other (expense) income, net | (3.8) | (0.8) | 9.1 | 1.8 | ||
Reorganization items, net | — | — | (1,311.5) | (263.9) | ||
Loss from continuing operations before income taxes | (19.0) | (3.8) | (1,714.1) | (344.9) | ||
Income tax expense | 7.2 | 1.4 | 10.8 | 2.2 | ||
Loss from continuing operations | (26.2) | (5.2) | (1,724.9) | (347.1) | ||
(Loss) income from discontinued operations, net of income taxes | — | — | 0.1 | — | ||
Net loss | $ (26.2) | (5.2) % | $ (1,724.8) | (347.0) % | ||
Basic and diluted (loss) income per share: | ||||||
Loss from continuing operations | $ (1.33) | $ (128.61) | ||||
(Loss) income from discontinued operations | — | — | ||||
Net loss | $ (1.33) | $ (128.60) | ||||
Weighted-average number of shares outstanding | ||||||
Basic and diluted | 19.7 | 13.4 |
MALLINCKRODT PLC | ||||||||||
CONSOLIDATED ADJUSTED EBITDA | ||||||||||
(unaudited, in millions) | ||||||||||
Successor | Predecessor | |||||||||
Three Months | Three Months | |||||||||
Gross | SG&A | R&D | Adjusted | Gross | SG&A | R&D | Adjusted | |||
Net loss | $ 221.1 | $ 141.2 | $ 28.2 | $ (26.2) | $ 150.8 | $ 129.2 | $ 25.7 | |||
Adjustments: | ||||||||||
Interest expense, net | — | — | — | 51.6 | — | — | — | 129.7 | ||
Income tax expense | — | — | — | 7.2 | — | — | — | 10.8 | ||
Depreciation | 7.5 | (0.5) | (0.2) | 8.2 | 9.3 | (1.6) | (0.5) | 11.4 | ||
Amortization | 18.1 | — | — | 18.1 | 125.6 | — | — | 125.6 | ||
Restructuring and related charges, net | — | — | — | 0.1 | — | — | — | (0.1) | ||
Non-restructuring impairment charge | — | — | — | — | — | — | — | 135.9 | ||
Income from discontinued operations | — | — | — | — | — | — | — | (0.1) | ||
Change in contingent consideration fair value | — | (1.1) | — | 1.1 | — | 0.2 | — | (0.2) | ||
Change in derivative asset & liabilities fair value | — | — | — | 1.9 | — | — | — | — | ||
Liabilities management and separation costs (1) | — | — | — | 15.2 | — | — | — | 142.1 | ||
Unrealized loss on equity investment | — | — | — | 1.3 | — | — | — | (7.2) | ||
Reorganization items, net (2) | — | 0.2 | — | (0.2) | — | — | — | 1,311.5 | ||
Share-based compensation | — | 1.4 | 0.1 | (1.5) | — | (2.3) | (0.1) | 2.4 | ||
Fresh-start inventory-related expense (3) | 83.8 | — | — | 83.8 | 43.6 | — | — | 43.6 | ||
As adjusted: | $ 330.5 | $ 141.2 | $ 28.1 | $ 160.6 | $ 329.3 | $ 125.5 | $ 25.1 | $ 180.6 |
(1) | Represents costs included in SG&A, primarily related to expenses incurred related to professional fees and costs incurred as we explored potential sales of non-core assets to enable further deleveraging post-emergence from the 2023 bankruptcy proceedings during the three months ended September 27, 2024 (Successor), as well as professional fees incurred by the Company (including where the Company is responsible for the fees of third parties, including pursuant to the forbearance agreements related to certain of the Company's former debt obligations) in connection with its pre-bankruptcy evaluation of its financial situation and related discussions with its stakeholders during the three months ended September 29, 2023 (Predecessor). |
(2) | As of December 30, 2023, professional fees directly related to the 2023 bankruptcy proceedings that were previously reflected as reorganization items, net, are classified within SG&A expenses. |
(3) | Represents inventory step-up amortization of |
MALLINCKRODT PLC | ||||
SEGMENT OPERATING INCOME | ||||
(unaudited, in millions) | ||||
Successor | Predecessor | |||
Three Months Ended September 27, 2024 | Three Months | |||
Specialty Brands (1) | $ 51.6 | $ 87.6 | ||
Specialty Generics (2) | 52.0 | 64.0 | ||
Segment operating income | 103.6 | 151.6 | ||
Unallocated amounts: | ||||
Corporate and unallocated expenses (3) | (27.1) | (16.3) | ||
Depreciation and amortization | (26.3) | (137.0) | ||
Share-based compensation | 1.5 | (2.4) | ||
Restructuring charges, net | (0.1) | 0.1 | ||
Non-restructuring impairment charge | — | (135.9) | ||
Liabilities management and separation costs (4) | (15.2) | (142.1) | ||
Operating income (loss) | $ 36.4 | $ (282.0) |
(1) | Includes |
(2) | Includes |
(3) | Includes administration expenses and certain compensation, legal, environmental and other costs not charged to the Company's reportable segments. |
(4) | Represents costs included in SG&A, primarily related to expenses incurred related to professional fees and costs incurred as we explored potential sales of non-core assets to enable further deleveraging post-emergence from the 2023 bankruptcy proceedings during the three months ended September 27, 2024 (Successor). Represents costs included in SG&A expenses, primarily related to professional fees incurred by the Company (including where the Company is responsible for the fees of third parties, including pursuant to the forbearance agreements related to certain of the Company's former debt obligations) in connection with its ongoing evaluation of its financial situation and related discussions with its stakeholders during the three months ended September 29, 2023 (Predecessor). |
MALLINCKRODT PLC | ||||||||||
SEGMENT NET SALES AND CONSTANT-CURRENCY GROWTH | ||||||||||
(unaudited, in millions) | ||||||||||
Successor | Predecessor | Non-GAAP Measure | ||||||||
Three Months | Three Months | Percent change | Currency | Constant-currency | ||||||
Specialty Brands | $ 286.0 | $ 286.2 | (0.1) % | — % | (0.1) % | |||||
Specialty Generics | 219.5 | 210.8 | 4.1 | — % | 4.1 | |||||
Net sales | $ 505.5 | $ 497.0 | 1.7 % | — % | 1.7 % |
MALLINCKRODT PLC | ||||||||||
SELECT PRODUCT LINE NET SALES AND CONSTANT-CURRENCY GROWTH | ||||||||||
(unaudited, in millions) | ||||||||||
Successor | Predecessor | Non-GAAP Measure | ||||||||
Three Months | Three Months | Percent change | Currency | Constant-currency | ||||||
Specialty Brands | ||||||||||
Acthar Gel | $ 126.4 | $ 122.1 | 3.5 % | — % | 3.5 % | |||||
INOmax | 64.0 | 72.9 | (12.2) | — | (12.2) | |||||
Therakos | 67.6 | 66.0 | 2.4 | 0.2 | 2.2 | |||||
Amitiza | 18.8 | 18.3 | 2.7 | — | 2.7 | |||||
Terlivaz | 7.3 | 4.4 | 65.9 | — | 65.9 | |||||
Other | 1.9 | 2.5 | (24.0) | (3.2) | (20.8) | |||||
Specialty Brands Total | 286.0 | 286.2 | (0.1) | — | (0.1) | |||||
Specialty Generics | ||||||||||
Opioids | 85.9 | 65.9 | 30.3 | — | 30.3 | |||||
ADHD | 41.3 | 41.5 | (0.5) | — | (0.5) | |||||
Addiction treatment | 18.1 | 15.1 | 19.9 | (0.1) | 20.0 | |||||
Other | 0.9 | 3.4 | (73.5) | — | (73.5) | |||||
Generics | 146.2 | 125.9 | 16.1 | — | 16.1 | |||||
Controlled substances | 27.2 | 22.0 | 23.6 | — | 23.6 | |||||
APAP | 40.0 | 57.4 | (30.3) | — | (30.3) | |||||
Other | 6.1 | 5.5 | 10.9 | — | 10.9 | |||||
API | 73.3 | 84.9 | (13.7) | — | (13.7) | |||||
Specialty Generics | 219.5 | 210.8 | 4.1 | — | 4.1 | |||||
Net sales | $ 505.5 | $ 497.0 | 1.7 % | — % | 1.7 % |
MALLINCKRODT PLC | ||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||
(unaudited, in millions, except per share data) | ||||||
Successor | Predecessor | |||||
Nine Months | Nine Months Ended September 29, 2023 | |||||
Percent of Net sales | Percent of Net sales | |||||
Net sales | $ 1,487.6 | 100.0 % | $ 1,396.6 | 100.0 % | ||
Cost of sales | 907.5 | 61.0 | 1,091.1 | 78.1 | ||
Gross profit | 580.1 | 39.0 | 305.5 | 21.9 | ||
Selling, general and administrative expenses | 406.0 | 27.3 | 369.6 | 26.5 | ||
Research and development expenses | 85.3 | 5.7 | 83.0 | 5.9 | ||
Restructuring charges, net | 10.5 | 0.7 | 0.9 | 0.1 | ||
Non-restructuring impairment charges | — | — | 135.9 | 9.7 | ||
Liabilities management and separation costs | 32.2 | 2.2 | 157.3 | 11.3 | ||
Operating income (loss) | 46.1 | 3.1 | (441.2) | (31.6) | ||
Interest expense | (177.5) | (11.9) | (457.7) | (32.8) | ||
Interest income | 20.2 | 1.4 | 12.8 | 0.9 | ||
Other expense, net | (3.6) | (0.2) | (6.7) | (0.5) | ||
Reorganization items, net | — | — | (1,321.1) | (94.6) | ||
Loss from continuing operations before income taxes | (114.8) | (7.7) | (2,213.9) | (158.5) | ||
Income tax expense | 20.4 | 1.4 | 508.1 | 36.4 | ||
Loss from continuing operations | (135.2) | (9.1) | (2,722.0) | (194.9) | ||
Income from discontinued operations, net of income taxes | 0.3 | — | 0.1 | — | ||
Net loss | $ (134.9) | (9.1) % | $ (2,721.9) | (194.9) % | ||
Basic and diluted (loss) income per share: | ||||||
Loss from continuing operations | $ (6.86) | $ (205.37) | ||||
Income from discontinued operations | 0.02 | 0.01 | ||||
Net loss | $ (6.85) | $ (205.37) | ||||
Weighted-average number of shares outstanding: | ||||||
Basic and diluted | 19.7 | 13.3 |
MALLINCKRODT PLC | ||||||||||
CONSOLIDATED ADJUSTED EBITDA | ||||||||||
(unaudited, in millions) | ||||||||||
Successor | Predecessor | |||||||||
Nine Months | Nine Months | |||||||||
Gross | SG&A | R&D | Adjusted | Gross | SG&A | R&D | Adjusted | |||
Net loss | $ 580.1 | $ 406.0 | $ 85.3 | $ (134.9) | $ 305.5 | $ 369.6 | $ 83.0 | |||
Adjustments: | ||||||||||
Interest expense, net | — | — | — | 157.3 | — | — | — | 444.9 | ||
Income tax expense | — | — | — | 20.4 | — | — | — | 508.1 | ||
Depreciation | 24.9 | (1.4) | (0.9) | 27.2 | 27.9 | (5.7) | (1.5) | 35.1 | ||
Amortization | 66.3 | — | — | 66.3 | 388.1 | — | — | 388.1 | ||
Restructuring and related charges, net | — | 2.5 | — | 8.0 | — | — | — | 0.9 | ||
Non-restructuring impairment charges | — | — | — | — | — | — | — | 135.9 | ||
Income from discontinued operations | — | — | — | (0.3) | — | — | — | (0.1) | ||
Change in contingent consideration fair value | — | (3.2) | — | 3.2 | — | 7.3 | — | (7.3) | ||
Change in derivative asset & liabilities fair value | — | — | — | 5.9 | — | — | — | — | ||
Liabilities management and separation costs (1) | — | — | — | 32.2 | — | — | — | 157.3 | ||
Unrealized (gain) loss on equity investment | — | — | — | (1.4) | — | — | — | 9.1 | ||
Reorganization items, net (2) | — | (4.5) | — | 4.5 | — | — | — | 1,321.1 | ||
Share-based compensation | 0.1 | (3.6) | (0.1) | 3.8 | — | (7.4) | (0.3) | 7.7 | ||
Fresh-start inventory-related expense (3) | 293.7 | — | — | 293.7 | 169.2 | — | — | 169.2 | ||
Recovery of bad debt - customer bankruptcy | — | 6.4 | — | (6.4) | — | — | — | — | ||
As adjusted: | $ 965.1 | $ 402.2 | $ 84.3 | $ 890.7 | $ 363.8 | $ 81.2 | $ 448.1 |
(1) | Represents costs included in SG&A, primarily related to expenses incurred related to professional fees and costs incurred as we explored potential sales of non-core assets to enable further deleveraging post-emergence from the 2023 bankruptcy proceedings during the nine months ended September 27, 2024 (Successor), as well as professional fees incurred by the Company (including where the Company is responsible for the fees of third parties, including pursuant to the forbearance agreements related to certain of the Company's former debt obligations) in connection with its pre-bankruptcy evaluation of its financial situation and related discussions with its stakeholders and professional fees and costs incurred as the Company explored potential sales of non-core assets to enable further deleveraging post-emergence from the Chapter 11 cases in 2022 during the nine months ended September 29, 2023 (Predecessor). |
(2) | As of December 30, 2023, professional fees directly related to the 2023 bankruptcy proceedings that were previously reflected as reorganization items, net, are classified within SG&A expenses. |
(3) | Represents |
MALLINCKRODT PLC | ||||
SEGMENT OPERATING INCOME | ||||
(unaudited, in millions) | ||||
Successor | Predecessor | |||
Nine Months | Nine Months | |||
Specialty Brands (1) | $ 97.2 | $ 181.6 | ||
Specialty Generics (2) | 152.6 | 131.9 | ||
Segment operating income | 249.8 | 313.5 | ||
Unallocated amounts: | ||||
Corporate and unallocated expenses (3) | (70.1) | (29.7) | ||
Depreciation and amortization | (93.5) | (423.2) | ||
Share-based compensation | (3.8) | (7.7) | ||
Restructuring charges, net | (10.5) | (0.9) | ||
Non-restructuring impairment charges | — | (135.9) | ||
Liabilities management and separation costs (4) | (32.2) | (157.3) | ||
Recovery of bad debt - customer bankruptcy | 6.4 | — | ||
Operating income (loss) | $ 46.1 | $ (441.2) |
(1) | Includes |
(2) | Includes |
(3) | Includes administration expenses and certain compensation, legal, environmental and other costs not charged to our reportable segments. |
(4) | Represents costs included in SG&A, primarily related to expenses incurred related to professional fees and costs incurred as we explored potential sales of non-core assets to enable further deleveraging post-emergence from the 2023 bankruptcy proceedings during the nine months ended September 27, 2024 (Successor). Represents costs included in SG&A expenses, primarily related to professional fees incurred by the Company (including where the Company is responsible for the fees of third parties, including pursuant to the forbearance agreements related to certain of the Company's former debt obligations) in connection with its ongoing evaluation of its financial situation and related discussions with its stakeholders and professional fees and costs incurred as the Company explored potential sales of non-core assets to enable further deleveraging post-emergence from the Chapter 11 cases in 2022 during the nine months ended September 29, 2023 (Predecessor). |
MALLINCKRODT PLC | ||||||||||
SEGMENT NET SALES AND CONSTANT-CURRENCY GROWTH | ||||||||||
(unaudited, in millions) | ||||||||||
Successor | Predecessor | Non-GAAP Measure | ||||||||
Nine Months | Nine Months | Percent change | Currency | Constant-currency | ||||||
Specialty Brands | $ 817.8 | $ 818.3 | (0.1) % | — % | (0.1) % | |||||
Specialty Generics | 669.8 | 578.3 | 15.8 | — | 15.8 | |||||
Net sales | $ 1,487.6 | $ 1,396.6 | 6.5 % | — % | 6.5 % |
MALLINCKRODT PLC | ||||||||||
SELECT PRODUCT LINE NET SALES AND CONSTANT-CURRENCY GROWTH | ||||||||||
(unaudited, in millions) | ||||||||||
Successor | Predecessor | Non-GAAP Measures | ||||||||
Nine Months | Nine Months | Percent change | Currency | Constant-currency | ||||||
Specialty Brands | ||||||||||
Acthar Gel | $ 346.9 | $ 320.9 | 8.1 % | — % | 8.1 % | |||||
INOmax | 200.6 | 232.5 | (13.7) | — | (13.7) | |||||
Therakos | 193.0 | 187.6 | 2.9 | 0.1 | 2.8 | |||||
Amitiza | 53.5 | 61.4 | (12.9) | — | (12.9) | |||||
Terlivaz | 18.6 | 10.0 | 86.0 | — | 86.0 | |||||
Other | 5.2 | 5.9 | (11.9) | (4.7) | (7.2) | |||||
Specialty Brands Total | 817.8 | 818.3 | (0.1) | — | (0.1) | |||||
Specialty Generics | ||||||||||
Opioids | 263.0 | 200.2 | 31.4 | — | 31.4 | |||||
ADHD | 114.8 | 82.9 | 38.5 | — | 38.5 | |||||
Addiction treatment | 54.5 | 46.8 | 16.5 | (0.1) | 16.6 | |||||
Other | 6.0 | 7.6 | (21.1) | — | (21.1) | |||||
Generics | 438.3 | 337.5 | 29.9 | — | 29.9 | |||||
Controlled substances | 76.5 | 61.4 | 24.6 | — | 24.6 | |||||
APAP | 139.0 | 163.6 | (15.0) | — | (15.0) | |||||
Other | 16.0 | 15.8 | 1.3 | — | 1.3 | |||||
API | 231.5 | 240.8 | (3.9) | — | (3.9) | |||||
Specialty Generics | 669.8 | 578.3 | 15.8 | — | 15.8 | |||||
Net sales | $ 1,487.6 | $ 1,396.6 | 6.5 % | — % | 6.5 % |
MALLINCKRODT PLC | |||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||
(unaudited, in millions) | |||
Successor | |||
September 27, | December 29, | ||
Assets | |||
Current Assets: | |||
Cash and cash equivalents | $ 410.5 | $ 262.7 | |
Accounts receivable, net | 383.3 | 377.5 | |
Inventories | 710.6 | 982.7 | |
Prepaid expenses and other current assets | 169.2 | 138.9 | |
Current assets held for sale | 49.3 | — | |
Total current assets | 1,722.9 | 1,761.8 | |
Property, plant and equipment, net | 361.7 | 321.7 | |
Intangible assets, net | 433.7 | 608.4 | |
Deferred income taxes | 777.1 | 801.0 | |
Long-term assets held for sale | 115.3 | — | |
Other assets | 227.0 | 240.7 | |
Total Assets | $ 3,637.7 | $ 3,733.6 | |
Liabilities and Shareholders' Equity | |||
Current Liabilities: | |||
Current maturities of long-term debt | $ 8.7 | $ 6.5 | |
Accounts payable | 84.5 | 100.4 | |
Accrued payroll and payroll-related costs | 90.0 | 82.8 | |
Accrued interest | 45.0 | 20.1 | |
Acthar Gel-Related Settlement | 21.3 | 21.5 | |
Accrued and other current liabilities | 280.1 | 269.9 | |
Current liabilities held for sale | 24.1 | — | |
Total current liabilities | 553.7 | 501.2 | |
Long-term debt | 1,731.8 | 1,755.9 | |
Acthar Gel-Related Settlement | 121.8 | 128.5 | |
Pension and postretirement benefits | 38.6 | 40.6 | |
Environmental liabilities | 34.4 | 35.1 | |
Other income tax liabilities | 25.7 | 19.6 | |
Long-term liabilities held for sale | 3.2 | — | |
Other liabilities | 100.2 | 92.5 | |
Total Liabilities | 2,609.4 | 2,573.4 | |
Shareholders' Equity: | |||
Ordinary A shares, | — | — | |
Ordinary shares, | 0.2 | 0.2 | |
Additional paid-in capital | 1,198.4 | 1,194.6 | |
Accumulated other comprehensive income | 2.8 | 3.6 | |
Retained deficit | (173.1) | (38.2) | |
Total Shareholders' Equity | 1,028.3 | 1,160.2 | |
Total Liabilities and Shareholders' Equity | $ 3,637.7 | $ 3,733.6 |
MALLINCKRODT PLC | ||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
(unaudited, in millions) | ||||
Successor | Predecessor | |||
Nine Months | Nine Months | |||
Cash Flows From Operating Activities: | ||||
Net loss | $ (134.9) | $ (2,721.9) | ||
Adjustments to reconcile net cash from operating activities: | ||||
Depreciation and amortization | 93.5 | 423.2 | ||
Share-based compensation | 3.8 | 7.7 | ||
Deferred income taxes | 22.9 | 475.5 | ||
Non-cash impairment charges | — | 135.9 | ||
Reorganization items, net | — | 1,294.1 | ||
Non-cash (amortization) accretion expense | (3.6) | 176.7 | ||
Other non-cash items | 18.9 | 11.6 | ||
Changes in assets and liabilities: | ||||
Accounts receivable, net | (16.5) | (23.8) | ||
Inventories | 222.1 | 99.1 | ||
Accounts payable | (5.6) | (31.2) | ||
Income taxes | (7.1) | 168.7 | ||
Opioid-Related Litigation Settlement Liability | — | (250.0) | ||
Acthar-Gel-Related Settlement | (21.4) | (16.5) | ||
Other | 13.6 | (46.8) | ||
Net cash from operating activities | 185.7 | (297.7) | ||
Cash Flows From Investing Activities: | ||||
Capital expenditures | (71.5) | (41.9) | ||
Proceeds from divestitures, net of cash | — | — | ||
Proceeds from debt and equity securities | 22.6 | — | ||
Other | 4.2 | 1.1 | ||
Net cash from investing activities | (44.7) | (40.8) | ||
Cash Flows From Financing Activities: | ||||
Issuance of external debt | — | 380.0 | ||
Repayment of debt | (4.4) | (52.0) | ||
Debt financing costs | — | (2.4) | ||
Other | (0.4) | (0.1) | ||
Net cash from financing activities | (4.8) | 325.5 | ||
Effect of currency rate changes on cash | (0.6) | (1.7) | ||
Net change in cash, cash equivalents and restricted cash, including cash classified within assets held for sale | 135.6 | (14.7) | ||
Less: Net change in cash classified within assets held for sale | (3.0) | — | ||
Net change in cash, cash equivalents and restricted cash | 132.6 | (14.7) | ||
Cash, cash equivalents and restricted cash at beginning of period | 343.4 | 466.7 | ||
Cash, cash equivalents and restricted cash at end of period | $ 476.0 | $ 452.0 | ||
Cash and cash equivalents at end of period | $ 410.5 | $ 389.8 | ||
Restricted cash included in prepaid expenses and other current assets at end of period | 23.9 | 22.9 | ||
Restricted cash included in other long-term assets at end of period | 41.6 | 39.3 | ||
Cash, cash equivalents and restricted cash at end of period | $ 476.0 | $ 452.0 |
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SOURCE Mallinckrodt plc
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