- Biocon Biologics Transaction Consists of Pre-tax Consideration of up to
$3.335 billion , Including$2 billion in Upfront Cash,$1 billion of Convertible Preferred Equity Representing a Stake of at Least 12.9% inBiocon Biologics (on a Fully Diluted Basis), and up to$335 million of Additional Payments.Rajiv Malik ,Viatris President, to Represent Viatris on Biocon Biologics Board. Transaction is Expected to Close in Second Half of 2022
- Material Benefits of the Transaction Upon Closing Include:
- Crystalizes Value Accretion at Approximately Triple Current Standalone Multiple
- Nearly 2/3 in Immediate Cash Proceeds
- Additional Potential Upside Participation Through Equity Stake with Governance Participation
- Frees up R&D and Capital Spend to Redeploy in a
More Concentrated Way - Enhances Immediate Additional Availability of Capital to Accelerate Reinvestment into Business or Share Repurchases
- Accelerates Phase I Financial Commitments
- Reduces Complexity and Execution Risk
- Enhances
Viatris' Margin Profile
- Reshaping Plan Also Identified Other Select Assets Which the Company Expects Will Unlock Additional Value of up to Approximately
$6 billion in Pre-tax Proceeds by the End of 2023
- Company Announces First Global Healthcare Gateway® Transaction Focused on Ophthalmology
- Company Provides 2022 Financial Guidance
- Company Hosts Virtual Investor Event to Detail the Company's Long-Term Strategic Direction
(1) Refers to 2022 estimated adjusted EBITDA of
The Company also announced today that following the completion of a comprehensive strategic review, it has taken the first bold step in its long-term strategy to unlock value and reshape the Company by reaching a definitive agreement with
Under the terms of the agreement,
At the time of close, which is currently expected to occur in the second half of 2022 subject to satisfaction of closing conditions, including certain regulatory approvals,
Pursuant to the transaction documents,
(2)
Executive Comments
Viatris CFO
Highlights of the Investor Event Presentation:
Strategic Priorities
Unlock Trapped Value and Simplify the Business
Through its comprehensive strategic review, conducted throughout 2021, the Company has identified opportunities that we believe will generate up to approximately
Build a More Durable, Higher-Margin Portfolio
Accelerate Financial Flexibility
Share Repurchase Program
2022 Financial Guidance
The Company is providing the following financial guidance measures for fiscal year 2022.
The Company is not providing forward-looking guidance for
(In billions) |
2022 |
2022 Midpoint |
||
Total Revenues |
|
|
||
Adjusted EBITDA (1) |
|
|
||
Free Cash Flow (1) (2) |
|
|
(1) |
Non-GAAP financial measures. See "Non-GAAP Financial Measures" for additional information. |
(2) |
Includes impact of EpiPen litigation settlement of |
First Global Healthcare Gateway® Transaction Focused on Ophthalmology
EpiPen Settlement Information
The Company has agreed, subject to approval by the Court, to a
The Board of Directors believes that this settlement is in the best interests of the Company and its stakeholders. The resolution of these indirect purchaser cases will allow the Company to move forward and continue focusing on its strategic priorities and its mission of empowering people worldwide to live healthier at every stage of life.
Webcast Information
Interested parties can access a live webcast of the Virtual Investor Event at investor.viatris.com. An archived version also will be available following the live event and can be accessed at the same location for a limited time.
Advisors
PJT Partners provided strategic advice and acted as financial advisor to the Board of
Financial Summary
Three Months Ended |
|||||||||||||||||||
(Unaudited; in millions, except %s) |
2021 |
2020 |
Reported |
Combined |
Combined |
||||||||||||||
Total |
$ 4,331.3 |
$ 3,587.7 |
21% |
(2)% |
—% |
||||||||||||||
Developed Markets |
2,560.8 |
2,378.6 |
8% |
—% |
—% |
||||||||||||||
Emerging Markets |
727.5 |
629.0 |
16% |
(8)% |
(8)% |
||||||||||||||
JANZ |
539.2 |
389.5 |
38% |
(6)% |
9% |
||||||||||||||
|
503.8 |
190.6 |
164% |
1% |
1% |
||||||||||||||
|
|||||||||||||||||||
Brands |
$ 2,611.9 |
$ 1,859.0 |
41% |
(3)% |
—% |
||||||||||||||
Complex Gx and Biosimilars |
348.4 |
338.8 |
3% |
6% |
6% |
||||||||||||||
Generics |
1,371.0 |
1,389.9 |
(1)% |
(3)% |
(3)% |
||||||||||||||
|
$ 1,546.4 |
$ 706.4 |
nm |
||||||||||||||||
|
35.6 % |
19.5 % |
|||||||||||||||||
Adjusted Gross Profit (4) |
$ 2,458.7 |
$ 1,902.2 |
29% |
||||||||||||||||
Adjusted Gross Margin (4) |
56.6 % |
52.5 % |
|||||||||||||||||
|
$ (263.8) |
$ (915.8) |
nm |
||||||||||||||||
Adjusted Net Earnings (4) |
$ 971.7 |
$ 650.6 |
49% |
||||||||||||||||
EBITDA (4) |
$ 703.8 |
$ 95.0 |
nm |
||||||||||||||||
Adjusted EBITDA (4) |
$ 1,415.8 |
$ 1,015.1 |
39% |
6% |
7% |
||||||||||||||
|
$ 523.1 |
$ 36.2 |
nm |
||||||||||||||||
Capital expenditures |
197.4 |
$ 116.9 |
69% |
||||||||||||||||
Free cash flow (4) |
$ 325.7 |
$ (80.7) |
nm |
Year Ended
|
|||||||||||||||||||
(Unaudited; in millions, except %s) |
2021 |
2020 |
Reported |
Combined |
Combined |
||||||||||||||
Total |
|
|
51% |
(3)% |
—% |
||||||||||||||
Developed Markets |
10,428.7 |
8,510.9 |
23% |
(1)% |
(1)% |
||||||||||||||
Emerging Markets |
3,144.7 |
1,853.8 |
70% |
(1)% |
(1)% |
||||||||||||||
JANZ |
2,027.4 |
1,195.3 |
70% |
(18)% |
9% |
||||||||||||||
|
2,212.8 |
259.9 |
nm |
2% |
2% |
||||||||||||||
|
|||||||||||||||||||
Brands |
|
$ 5,234.9 |
nm |
(5)% |
1% |
||||||||||||||
Complex Gx and Biosimilars |
1,342.1 |
1,295.5 |
4% |
3% |
3% |
||||||||||||||
Generics |
5,630.2 |
5,289.5 |
6% |
(2)% |
(2)% |
||||||||||||||
|
$ 5,575.5 |
$ 3,796.7 |
47% |
||||||||||||||||
|
31.2 % |
31.8 % |
|||||||||||||||||
Adjusted Gross Profit (4) |
|
$ 6,394.5 |
64% |
||||||||||||||||
Adjusted Gross Margin (4) |
58.7 % |
53.5 % |
|||||||||||||||||
|
|
$ (669.9) |
(89)% |
||||||||||||||||
Adjusted Net Earnings (4) |
$ 4,467.8 |
$ 2,371.8 |
nm |
||||||||||||||||
EBITDA (4) |
$ 4,540.2 |
$ 2,041.1 |
nm |
||||||||||||||||
Adjusted EBITDA (4) |
$ 6,426.1 |
$ 3,654.1 |
76% |
(7)% |
(3)% |
||||||||||||||
|
$ 3,016.9 |
$ 1,231.8 |
nm |
||||||||||||||||
Capital expenditures |
457.2 |
243.0 |
88% |
||||||||||||||||
Free cash flow (4) |
$ 2,559.7 |
$ 988.8 |
nm |
___________
(1) |
Mylan is the accounting acquiror in the combination of Mylan N.V. with Pfizer Inc.'s Upjohn business, which was completed on |
(2) |
Represents operational change for net sales. See "Certain Key Terms" in this release for more information. |
(3) |
See "Certain Key Terms" for more information about Combined Adjusted Q4 and FY 2020 results and Combined LOE Adjusted Q4 and FY 2020 results. |
(4) |
Non-GAAP financial measures. See "Non-GAAP Financial Measures" for additional information. |
Fourth Quarter Highlights
- Fourth quarter 2021 net sales totaled
$4.33 billion , down 2% on an operational basis compared to combined adjusted Q4 2020 results, but flat on an operational basis compared to combined LOE adjusted Q4 2020 results, and performed better than expectations, driven by solid performance across all four of our segments—Developed Markets, Emerging Markets, JANZ, andGreater China . - Brands performed on track with expectations, driven by products such as Lipitor®, Lyrica® and the Thrombosis portfolio.
- Complex generics and biosimilars delivered strong growth while managing competition on Wixela Inhub® and Xulane®.
- Generics, which include diversified product forms such as extended-release oral solids, injectables, transdermals and topicals, performed better than expected, driven primarily by favorability in the JANZ and Emerging Markets segments.
- The Company generated
$117 million in new product revenues (as defined in "Certain Key Terms" below) in the fourth quarter. - The Company generated
$326 million of free cash flow in the fourth quarter, primarily driven by solidU.S. GAAP net cash provided by operating activities of$523 million in the quarter. - Continued solid progress in advancing key pipeline programs for biosimilars, complex products and complex injectables, including the launch of Semglee® as the first interchangeable biosimilar in the
U.S.
Full-Year 2021 Highlights
- Full-year 2021 net sales totaled
$17.81 billion , down 3% on an operational basis compared to combined adjusted full-year 2020 results, but flat on an operational basis compared to combined LOE adjusted full-year 2020 results, and performed better than expectations, driven by solid performance across all four of our segments—Developed Markets, Emerging Markets, JANZ, andGreater China . - Brands performed on track with expectations, driven by products such as Viagra®, Lipitor®, Lyrica® and the Thrombosis portfolio.
- Complex generics and biosimilars delivered strong growth while managing competition on Wixela Inhub® and Xulane®.
- Generics performed better than expected, driven primarily by favorability in the JANZ and Emerging Markets segments.
- The Company generated approximately
$700 million in new product revenues (as defined in "Certain Key Terms" below) for the fiscal year. - The Company generated
$2.56 billion of free cash flow, primarily driven by solidU.S. GAAP net cash provided by operating activities of$3.02 billion . Viatris paid quarterly cash dividends of approximately$400 million during 2021. OnJanuary 4, 2022 , the Company's Board of Directors declared a quarterly cash dividend oftwelve cents ($0.12 ) per share on the Company's issued and outstanding common stock, an increase of approximately 9% compared with previous quarters per share dividend, which will be payable onMarch 16, 2022 , to shareholders of record as of the close of business onFebruary 24, 2022 .- The Company has repaid approximately
$2 .1 billion of debt.
Non-GAAP Financial Measures
Certain Key Terms
The combined measures described herein are calculated as indicated, are reflected as approximations and/or with rounding, and do not reflect pro forma results in accordance with ASC 805 or Article 11 of Regulation S-X. Such measures also do not reflect the effect of any purchase accounting adjustments, including but not limited to the elimination of intercompany sales and the fair value of assets and liabilities.
Combined Adjusted Q4 and FY 2020 results refer to the sum of (i) Mylan's standalone results, (ii) the standalone carve-out results from the Upjohn Business for the nine months ended
Combined LOE Adjusted Q4, and FY 2020 results refer to Combined Adjusted Q4 and FY 2020 results, adjusted for the impact of loss of exclusivity ("LOE") of Lyrica and Celebrex in
New product sales, new product launches or new product revenues refer to revenue from new products launched in 2021 and the carryover impact of new products, including business development, launched within the last twelve months (e.g., acquisition of
Operational change refers to constant currency percentage change and is derived by translating net sales or revenues for the current periods presented at prior year comparative period exchange rates, and in doing so shows the percentage change from 2021 constant currency net sales or revenues to the corresponding amount in the prior year.
Non-GAAP Financial Measures
This press release includes the presentation and discussion of certain financial information that differs from what is reported under accounting principles generally accepted in
About
Forward-Looking Statements
This release contains "forward-looking statements". These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may include, without limitation, 2022 guidance; Company completes comprehensive strategic review and unveils plan to reshape the Company for the future; announces combination of its Biosimilars portfolio with
|
|||||||
Condensed Consolidated Statements of Operations |
|||||||
(Unaudited; in millions, except per share amounts) |
|||||||
Three Months Ended |
Year Ended |
||||||
|
|
||||||
2021 |
2020 |
2021 |
2020 |
||||
Revenues: |
|||||||
Net sales |
$ 4,331.3 |
$ 3,587.7 |
$ 17,813.6 |
$ 11,819.9 |
|||
Other revenues |
10.3 |
35.8 |
72.7 |
126.1 |
|||
Total revenues |
4,341.6 |
3,623.5 |
17,886.3 |
11,946.0 |
|||
Cost of sales |
2,795.2 |
2,917.1 |
12,310.8 |
8,149.3 |
|||
Gross profit |
1,546.4 |
706.4 |
5,575.5 |
3,796.7 |
|||
Operating expenses: |
|||||||
Research and development |
267.2 |
154.8 |
751.1 |
555.1 |
|||
Selling, general and administrative |
1,082.9 |
1,361.4 |
4,529.2 |
3,344.6 |
|||
Litigation settlements and other contingencies, net |
273.9 |
71.3 |
329.2 |
107.8 |
|||
Total operating expenses |
1,624.0 |
1,587.5 |
5,609.5 |
4,007.5 |
|||
Loss from operations |
(77.6) |
(881.1) |
(34.0) |
(210.8) |
|||
Interest expense |
148.2 |
144.4 |
636.2 |
497.8 |
|||
Other (income) expense, net |
(21.9) |
(12.0) |
(5.8) |
12.6 |
|||
Loss before income taxes |
(203.9) |
(1,013.5) |
(664.4) |
(721.2) |
|||
Income tax provision (benefit) |
59.9 |
(97.7) |
604.7 |
(51.3) |
|||
Net loss |
(263.8) |
(915.8) |
(1,269.1) |
(669.9) |
|||
Loss per share attributable to |
|||||||
Basic |
$ (0.22) |
$ (1.07) |
$ (1.05) |
$ (1.11) |
|||
Diluted |
$ (0.22) |
$ (1.07) |
$ (1.05) |
$ (1.11) |
|||
Weighted average shares outstanding: |
|||||||
Basic |
1,209.4 |
854.4 |
1,208.8 |
601.2 |
|||
Diluted |
1,209.4 |
854.4 |
1,208.8 |
601.2 |
|
|||
Condensed Consolidated Balance Sheets |
|||
(Unaudited; in millions) |
|||
|
|
||
ASSETS |
|||
Assets |
|||
Current assets |
|||
Cash and cash equivalents |
$ 701.2 |
$ 844.4 |
|
Accounts receivable, net |
4,266.4 |
4,843.8 |
|
Inventories |
3,977.7 |
5,471.9 |
|
Prepaid expenses and other current assets |
1,957.6 |
1,707.4 |
|
Total current assets |
10,902.9 |
12,867.5 |
|
Intangible assets, net |
26,134.2 |
29,683.2 |
|
|
12,113.7 |
12,347.0 |
|
Other non-current assets |
5,692.0 |
6,655.3 |
|
Total assets |
$ 54,842.8 |
$ 61,553.0 |
|
LIABILITIES AND EQUITY |
|||
Liabilities |
|||
Current portion of long-term debt and other long-term obligations |
$ 1,877.5 |
$ 2,308.5 |
|
Current liabilities |
8,006.9 |
8,254.4 |
|
Long-term debt |
19,717.1 |
22,429.2 |
|
Other non-current liabilities |
4,748.6 |
5,606.8 |
|
Total liabilities |
34,350.1 |
38,598.9 |
|
Shareholders' equity |
20,492.7 |
22,954.1 |
|
Total liabilities and equity |
$ 54,842.8 |
$ 61,553.0 |
|
|||
Select Key Product |
|||
Three and Twelve Months Ended |
|||
(Unaudited) |
|||
(In millions) |
Three months ended |
Twelve months ended |
|
Select Key Global Products |
|||
Lipitor ® |
$ 390.3 |
$ 1,663.2 |
|
Norvasc ® |
188.8 |
824.7 |
|
Lyrica ® |
172.6 |
728.5 |
|
Viagra ® |
121.4 |
533.8 |
|
Celebrex ® |
87.1 |
344.4 |
|
Creon ® |
78.1 |
309.8 |
|
Effexor ® |
77.2 |
316.8 |
|
Zoloft ® |
75.5 |
284.3 |
|
EpiPen® Auto-Injectors |
54.4 |
391.7 |
|
Xalabrands |
54.0 |
226.0 |
|
Select Key Segment Products |
|||
Influvac ® |
$ 134.0 |
$ 299.3 |
|
Amitiza ® |
54.0 |
201.5 |
|
Xanax ® |
44.4 |
185.9 |
|
Yupelri ® |
43.8 |
161.9 |
|
Dymista ® |
38.1 |
168.0 |
____________
(a) |
The Company does not disclose net sales for any products considered competitively sensitive. |
(b) |
Products disclosed may change in future periods, including as a result of seasonality, competition or new product launches. |
Reconciliation of Non-GAAP Financial Measures
(Unaudited)
Reconciliation of
Below is a reconciliation of
Three Months Ended |
Year Ended |
||||||
(in millions) |
2021 |
2020 |
2021 |
2020 |
|||
|
$ (263.8) |
$ (915.8) |
$ (1,269.1) |
$ (669.9) |
|||
Purchase accounting related amortization (primarily included in cost of sales) (a) |
695.0 |
861.1 |
4,039.7 |
1,933.6 |
|||
Litigation settlements and other contingencies, net |
273.9 |
71.3 |
329.2 |
107.8 |
|||
Interest expense (primarily amortization of premiums and discounts on long term debt) |
(13.5) |
(4.0) |
(53.8) |
12.6 |
|||
Clean energy investments pre-tax loss |
9.7 |
11.0 |
61.9 |
48.4 |
|||
Acquisition related costs (primarily included in SG&A) (b) |
84.9 |
395.4 |
234.6 |
613.6 |
|||
Restructuring related costs (c) |
157.8 |
276.1 |
899.4 |
323.1 |
|||
Share-based compensation expense |
22.5 |
29.4 |
111.2 |
79.2 |
|||
Other special items included in: |
|||||||
Cost of sales (d) |
75.9 |
138.8 |
333.0 |
438.1 |
|||
Research and development expense (e) |
71.1 |
1.4 |
83.2 |
47.2 |
|||
Selling, general and administrative expense |
10.1 |
31.7 |
49.5 |
44.6 |
|||
Other expense, net |
(5.7) |
(0.4) |
(8.0) |
(16.8) |
|||
Tax effect of the above items and other income tax related items (f) |
(146.2) |
(245.4) |
(343.0) |
(589.7) |
|||
Adjusted net earnings |
$ 971.7 |
$ 650.6 |
$ 4,467.8 |
$ 2,371.8 |
____________
Significant items for the three months and year ended |
|
(a) |
Includes amortization of the purchase accounting inventory fair value adjustment related to the Combination totaling approximately |
(b) |
Acquisition related costs consist primarily of transaction costs including legal and consulting fees and integration activities. |
(c) |
For the three months ended |
(d) |
Costs incurred during the three months and year ended |
(e) |
Adjustments primarily relate to non-refundable payments related to development partner agreements. |
(f) |
Adjusted for changes for uncertain tax positions and for certain impacts of the Combination. |
Reconciliation of
Below is a reconciliation of
Three Months Ended |
Year Ended |
||||||
|
|
||||||
(In millions) |
2021 |
2020 |
2021 |
2020 |
|||
|
$ (263.8) |
$ (915.8) |
$ (1,269.1) |
$ (669.9) |
|||
Add / (deduct) adjustments: |
|||||||
Net contribution attributable to equity method investments |
9.7 |
11.0 |
61.9 |
48.4 |
|||
Income tax provision (benefit) |
59.9 |
(97.7) |
604.7 |
(51.3) |
|||
Interest expense (a) |
148.2 |
144.4 |
636.2 |
497.8 |
|||
Depreciation and amortization (b) |
749.8 |
953.1 |
4,506.5 |
2,216.1 |
|||
EBITDA |
$ 703.8 |
$ 95.0 |
$ 4,540.2 |
$ 2,041.1 |
|||
Add adjustments: |
|||||||
Share-based compensation expense |
22.5 |
29.4 |
111.2 |
79.2 |
|||
Litigation settlements and other contingencies, net |
273.9 |
71.3 |
329.2 |
107.8 |
|||
Restructuring, acquisition related and other special items (c) |
415.6 |
819.4 |
1,445.5 |
1,426.0 |
|||
Adjusted EBITDA |
$ 1,415.8 |
$ 1,015.1 |
$ 6,426.1 |
$ 3,654.1 |
____________
(a) |
Includes amortization of premiums and discounts on long-term debt. |
(b) |
Includes purchase accounting related amortization. |
(c) |
See items detailed in the Reconciliation of |
Summary of Total Revenues by Segment
Three Months Ended |
|||||||||||
|
|||||||||||
(In millions, except %s) |
2021 |
2020 |
% Change |
2021 |
2021 |
Constant |
|||||
Net sales |
|||||||||||
Developed Markets |
$ 2,560.8 |
$ 2,378.6 |
8% |
$ 41.4 |
$ 2,602.2 |
9% |
|||||
|
503.8 |
190.6 |
nm |
(8.7) |
495.1 |
nm |
|||||
JANZ |
539.2 |
389.5 |
38% |
31.6 |
570.8 |
47% |
|||||
Emerging Markets |
727.5 |
629.0 |
16% |
21.5 |
749.0 |
19% |
|||||
Total net sales |
4,331.3 |
3,587.7 |
21% |
85.8 |
4,417.1 |
23% |
|||||
Other revenues (3) |
10.3 |
35.8 |
(71)% |
0.3 |
10.6 |
(70)% |
|||||
Consolidated total revenues (4) |
$ 4,341.6 |
$ 3,623.5 |
20% |
$ 86.1 |
$ 4,427.7 |
22% |
|||||
Year Ended |
|||||||||||
|
|||||||||||
(In millions, except %s) |
2021 |
2020 |
% Change |
2021 |
2021 Constant Currency Revenues |
Constant Currency % Change (2) |
|||||
Net sales |
|||||||||||
Developed Markets |
$ 10,428.7 |
$ 8,510.9 |
23% |
$ (185.1) |
$ 10,243.6 |
20% |
|||||
|
2,212.8 |
259.9 |
nm |
(9.3) |
2,203.5 |
nm |
|||||
JANZ |
2,027.4 |
1,195.3 |
70 % |
(2.7) |
2,024.7 |
69% |
|||||
Emerging Markets |
3,144.7 |
1,853.8 |
70% |
(9.3) |
3,135.4 |
69% |
|||||
Total net sales |
17,813.6 |
11,819.9 |
51% |
(206.4) |
17,607.2 |
49% |
|||||
Other revenues (3) |
72.7 |
126.1 |
(42)% |
(1.0) |
71.7 |
(43)% |
|||||
Consolidated total revenues (4) |
$ 17,886.3 |
$ 11,946.0 |
50% |
$ (207.4) |
$ 17,678.9 |
48% |
____________
(1) |
Currency impact is shown as unfavorable (favorable). |
(2) |
The constant currency percentage change is derived by translating net sales or revenues for the current period at prior year comparative period exchange rates, and in doing so shows the percentage change from 2021 constant currency net sales or revenues to the corresponding amount in the prior year. |
(3) |
For the three months ended |
(4) |
Amounts exclude intersegment revenue that eliminates on a consolidated basis. |
Reconciliation of Statements of Operations
(Unaudited; in millions, except %s) |
|||||||
Three Months Ended |
Year Ended |
||||||
|
|
||||||
2021 |
2020 |
2021 |
2020 |
||||
|
$ 2,795.2 |
$ 2,917.1 |
$ 12,310.8 |
$ 8,149.3 |
|||
Deduct: |
|||||||
Purchase accounting amortization and other related items |
(695.0) |
(861.1) |
(4,039.7) |
(1,933.6) |
|||
Acquisition related items |
(5.9) |
(5.4) |
(13.9) |
(16.9) |
|||
Restructuring and related costs |
(135.2) |
(190.1) |
(534.7) |
(207.7) |
|||
Share-based compensation expense |
(0.3) |
(0.4) |
(2.3) |
(1.5) |
|||
Other special items |
(75.9) |
(138.8) |
(333.0) |
(438.1) |
|||
Adjusted cost of sales |
$ 1,882.9 |
$ 1,721.3 |
$ 7,387.2 |
$ 5,551.5 |
|||
Adjusted gross profit (a) |
$ 2,458.7 |
$ 1,902.2 |
$ 10,499.1 |
$ 6,394.5 |
|||
Adjusted gross margin (a) |
57% |
52% |
59% |
54% |
|||
Three Months Ended |
Year Ended |
||||||
|
|
||||||
2021 |
2020 |
2021 |
2020 |
||||
|
$ 267.2 |
$ 154.8 |
$ 751.1 |
$ 555.1 |
|||
Deduct: |
|||||||
Acquisition related costs |
(11.5) |
(1.4) |
(12.6) |
(1.7) |
|||
Restructuring and related costs |
(1.4) |
— |
(13.3) |
(0.3) |
|||
Share-based compensation expense |
(1.0) |
(0.7) |
(4.4) |
(2.3) |
|||
Other special items |
(71.1) |
(1.4) |
(83.2) |
(47.2) |
|||
Adjusted R&D |
$ 182.2 |
$ 151.3 |
$ 637.6 |
$ 503.6 |
|||
Adjusted R&D as % of total revenues |
4% |
4% |
4 % |
4% |
|||
Three Months Ended |
Year Ended |
||||||
|
|
||||||
2021 |
2020 |
2021 |
2020 |
||||
|
$ 1,082.9 |
$ 1,361.4 |
$ 4,529.2 |
$ 3,344.6 |
|||
Deduct: |
|||||||
Acquisition related costs |
(67.5) |
(388.5) |
(208.1) |
(595.0) |
|||
Restructuring and related costs |
(21.4) |
(86.0) |
(351.5) |
(115.0) |
|||
Share-based compensation expense |
(21.2) |
(28.3) |
(104.4) |
(75.4) |
|||
Other special items and reclassifications |
(10.1) |
(31.7) |
(49.5) |
(44.6) |
|||
Adjusted SG&A |
$ 962.7 |
$ 826.9 |
$ 3,815.7 |
$ 2,514.6 |
|||
Adjusted SG&A as % of total revenues |
22% |
23% |
21% |
21% |
|||
Three Months Ended |
Year Ended |
||||||
|
|
||||||
2021 |
2020 |
2021 |
2020 |
||||
|
$ 1,624.0 |
$ 1,587.5 |
$ 5,609.5 |
$ 4,007.5 |
|||
Deduct: |
|||||||
Litigation settlements and other contingencies, net |
(273.9) |
(71.3) |
(329.2) |
(107.8) |
|||
R&D adjustments |
(85.0) |
(3.5) |
(113.5) |
(51.5) |
|||
SG&A adjustments |
(120.2) |
(534.5) |
(713.5) |
(830.0) |
|||
Adjusted total operating expenses |
$ 1,144.9 |
$ 978.2 |
$ 4,453.3 |
$ 3,018.2 |
|||
Adjusted earnings from operations (b) |
$ 1,313.8 |
$ 924.0 |
$ 6,045.8 |
$ 3,376.3 |
|||
Three Months Ended |
Year Ended |
||||||
|
|
||||||
2021 |
2020 |
2021 |
2020 |
||||
|
$ 148.2 |
$ 144.4 |
$ 636.2 |
$ 497.8 |
|||
Add / (Deduct): |
|||||||
Interest expense related to clean energy investments |
(0.1) |
(0.2) |
(0.5) |
(3.2) |
|||
Accretion of contingent consideration liability |
(2.2) |
(2.9) |
(9.5) |
(12.3) |
|||
Amortization of premiums and discounts on long-term debt |
16.9 |
8.4 |
68.5 |
8.4 |
|||
Restructuring and related costs |
— |
(0.1) |
— |
(0.1) |
|||
Other special items |
(1.1) |
(1.4) |
(4.7) |
(5.6) |
|||
Adjusted interest expense |
$ 161.7 |
$ 148.2 |
$ 690.0 |
$ 485.0 |
|||
Three Months Ended |
Year Ended |
||||||
|
|
||||||
2021 |
2020 |
2021 |
2020 |
||||
|
$ (21.9) |
$ (12.0) |
$ (5.8) |
$ 12.6 |
|||
Add / (Deduct): |
|||||||
Clean energy investments pre-tax loss (c) |
(9.7) |
(11.0) |
(61.9) |
(48.4) |
|||
Other items |
5.7 |
0.4 |
8.0 |
16.8 |
|||
Adjusted other income, net |
$ (25.9) |
$ (22.6) |
$ (59.7) |
$ (19.0) |
|||
Three Months Ended |
Year Ended |
||||||
|
|
||||||
2021 |
2020 |
2021 |
2020 |
||||
|
$ (203.9) |
$ (1,013.5) |
$ (664.4) |
$ (721.2) |
|||
Total pre-tax non-GAAP adjustments |
1,381.8 |
1,811.8 |
6,079.9 |
3,631.4 |
|||
Adjusted earnings before income taxes |
$ 1,177.9 |
$ 798.3 |
$ 5,415.5 |
$ 2,910.2 |
|||
|
$ 59.9 |
$ (97.7) |
$ 604.7 |
$ (51.3) |
|||
Adjusted tax expense |
146.2 |
245.4 |
343.0 |
589.7 |
|||
Adjusted income tax provision |
$ 206.1 |
$ 147.7 |
$ 947.7 |
$ 538.4 |
|||
Adjusted effective tax rate |
17.5 % |
18.5 % |
17.5 % |
18.5 % |
___________
(a) |
|
(b) |
|
(c) |
Adjustment represents exclusion of activity related to Mylan's clean energy investments, the activities of which qualify for income tax credits under section 45 of the |
Reconciliation of Estimated 2022 GAAP Net Cash Provided by Operating Activities to Free Cash Flow
(Unaudited; in millions) |
|
A reconciliation of the estimated 2022 GAAP |
|
Estimated GAAP |
|
Less: Capital Expenditures |
|
Free Cash Flow |
|
Combined Adjusted EBITDA - Three and twelve months ended
(In millions) |
Three months ended |
Twelve months ended |
|
|
$ (915.8) |
$ (669.9) |
|
Add / (deduct) adjustments: |
|||
Net contribution attributable to equity method investments |
11.0 |
48.4 |
|
Income tax benefit |
(97.7) |
(51.3) |
|
Interest expense (a) |
144.4 |
497.8 |
|
Depreciation and amortization (b) |
953.1 |
2,216.1 |
|
EBITDA |
95.0 |
2,041.1 |
|
Add adjustments: |
|||
Share-based compensation expense |
29.4 |
79.2 |
|
Litigation settlements and other contingencies, net |
71.3 |
107.8 |
|
Restructuring, acquisition related and other special items (c) |
819.4 |
1,426.0 |
|
Viatris Adjusted EBITDA |
1,015.1 |
3,654.1 |
|
Upjohn Adjusted EBITDA for nine months ended |
— |
2,806.0 |
|
1,015.1 |
6,460.1 |
||
Upjohn estimated Adjusted EBITDA (d) |
347.1 |
347.1 |
|
Combined Adjusted EBITDA |
$ 1,362.2 |
$ 6,807.2 |
___________
(a) |
Includes clean energy investment financing and accretion of contingent consideration. |
(b) |
Includes purchase accounting related amortization. |
(c) |
See items detailed in the Reconciliation of |
(d) |
Amount represents an estimate of Upjohn's Adjusted EBITDA for the period from |
Gross Leverage Ratio
Twelve Months Ended |
|
|
$ 6,426.1 |
Reported debt balances: |
|
Long-term debt, including current portion |
21,577.4 |
Short-term borrowings and other current obligations |
1,493.0 |
Total |
23,070.4 |
Add / (deduct): |
|
Net premiums on various debt issuances |
(651.6) |
Deferred financing fees |
42.4 |
Fair value adjustment for hedged debt |
(16.3) |
Total debt at notional amounts |
$ 22,444.9 |
Gross debt to adjusted EBITDA |
3.49 x |
Long-term Gross Leverage Target
The stated forward-looking non-GAAP financial measure of long-term gross leverage target of 3.0x, with a range of 2.8x – 3.2x, is based on the ratio of (i) targeted notional gross debt and (ii) targeted Adjusted EBITDA. However, the Company has not quantified future amounts to develop this target but has stated its goal to manage notional gross debt and adjusted earnings and adjusted EBITDA over time in order to generally maintain or reach the target. This target does not reflect Company guidance.
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SOURCE
MEDIA: Jennifer Mauer, +1.724.514.1968, Communications@viatris.com, Jennifer.Mauer@viatris.com; INVESTORS: Bill Szablewski, +1.724.514.1813, InvestorRelations@viatris.com, William.Szablewski@viatris.com