Allergan expects revenue greater than $8BSeptember 29, 2015
Allergan plc has updated its second-half 2015 continuing operations financial forecast. The forecast reflects adjustments for the upcoming expected discontinued operations as a result of the previously announced divestiture of its Global Generics business to Teva Pharmaceuticals.
The Company stated that it intends to begin reporting its Global Generics business as discontinued operations with its third quarter 2015 results. The transaction with Teva is expected to close in the first quarter of 2016.
Continuing operations includes the U.S. Brands, U.S. Medical, International Brands and Anda distribution segments. For the second-half of 2015, Allergan expects to report non-GAAP continuing operations as follows:
Revenue is expected to be greater than $8 billion
Adjusted earnings before interest and taxes (EBIT) are expected to be between $3.8 billion and $4.0 billion
Non-GAAP earnings per share (EPS) are expected to be between $6.25 and $6.65
Allergan says that its continuing operations forecast for the second half of 2015 includes all of the company’s non-GAAP interest expense of approximately ~$750 million.
Following the close of the divestiture of the Generics business to Teva, New Allergan expects to have a powerful financial profile to drive continued long-term growth:
10% branded revenue growth
Non-GAAP gross margins of 77% to 79% with additional long-term expansion anticipated
Non-GAAP SG&A as a percentage of revenue between 21-24%, declining within that range over time
Non-GAAP tax rate of ~15%
Interest expense for New Allergan will be largely dependent on capital deployment decisions following the close of the transaction
Commitment to investment grade ratings
“New Allergan will have strong double-digit revenue growth and will be a development powerhouse stacked with 70 mid-to-late stage R&D projects to address customer and patient needs,” said Brent Saunders, CEO and President.
“The New Allergan will be lean and nimble with an expanded margin profile driven by leading brands in seven therapeutic categories, a streamlined operating model with one of the most efficient SG&A as a percentage of sales in the industry, a non-GAAP tax rate of approximately 15 percent, and a simplified manufacturing network globally.”
“The continued robust performance of our overall business and strong mid-to-late stage pipeline puts Allergan in a strong position to meet our growth targets for the remainder of the year and over the long-term.”