

19.	Condensed Consolidating Financial Statements

MIFSA, a indirectly 100%-owned subsidiary of Mallinckrodt plc, is the borrower under the Notes, which are fully and unconditionally guaranteed by Mallinckrodt plc. The following information provides the composition of the Company's comprehensive income, assets, liabilities, equity and cash flows by relevant group within the Company: Mallinckrodt plc as guarantor of the Notes, MIFSA as issuer of the Notes and the other subsidiaries. There are no subsidiary guarantees related to the Notes.

Set forth below are the unaudited condensed consolidating financial statements for the three and six months ended March 27, 2015 and March 28, 2014, and as of March 27, 2015 and September 26, 2014. Eliminations represent adjustments to eliminate investments in subsidiaries and intercompany balances and transactions between or among Mallinckrodt plc, MIFSA and other subsidiaries. Unaudited condensed consolidating financial information for Mallinckrodt plc and MIFSA, on a standalone basis, has been presented using the equity method of accounting for subsidiaries.

MALLINCKRODT PLC

CONDENSED CONSOLIDATING BALANCE SHEET

As of March 27, 2015

(unaudited, in millions)



	Mallinckrodt plc		Mallinckrodt International Finance S.A.		Other Subsidiaries		Eliminations			Consolidated
Assets
Current Assets:
Cash and cash equivalents	$	2.0	$	270.0	$	781.5	$	—		$	1,053.5
Accounts receivable, net	—		—		556.1		—			556.1
Inventories	—		—		348.7		—			348.7
Deferred income taxes	—		—		136.2		—			136.2
Prepaid expenses and other current assets	0.9		—		123.6		—			124.5
Intercompany receivable	17.2		—		11.7		(28.9		)	—
Total current assets	20.1		270.0		1,957.8		(28.9		)	2,219.0
Property, plant and equipment, net	—		—		940.9		—			940.9
Goodwill	—		—		2,426.1		—			2,426.1
Intangible assets, net	—		—		6,858.7		—			6,858.7
Investment in subsidiaries	673.7		10,937.4		5,031.9		(16,643.0		)	—
Intercompany loan receivable	4,512.3		—		2,269.6		(6,781.9		)	—
Other assets	—		70.5		299.1		—			369.6
Total Assets	$	5,206.1	$	11,277.9	$	19,784.1	$	(23,453.8	)	$	12,814.3

Liabilities and Shareholders' Equity
Current Liabilities:
Current maturities of long-term debt	$	—	$	20.0	$	2.4	$	—		$	22.4
Accounts payable	4.9		0.2		136.8		—			141.9
Accrued payroll and payroll-related costs	0.1		—		75.0		—			75.1
Accrued royalties	—		—		28.0		—			28.0
Accrued and other current liabilities	3.3		42.9		462.1		—			508.3
Intercompany payable	11.7		—		17.2		(28.9		)	—
Total current liabilities	20.0		63.1		721.5		(28.9		)	775.7
Long-term debt	—		3,761.0		205.3		—			3,966.3
Pension and postretirement benefits	—		—		116.6		—			116.6
Environmental liabilities	—		—		79.0		—			79.0
Deferred income taxes	—		—		2,297.0		—			2,297.0
Other income tax liabilities	—		—		109.7		—			109.7
Intercompany loans payable	—		2,421.9		4,360.0		(6,781.9		)	—
Other liabilities	—		—		283.9		—			283.9
Total liabilities	20.0		6,246.0		8,173.0		(6,810.8		)	7,628.2
Shareholders' Equity	5,186.1		5,031.9		11,611.1		(16,643.0		)	5,186.1
Total Liabilities and Shareholders' Equity	$	5,206.1	$	11,277.9	$	19,784.1	$	(23,453.8	)	$	12,814.3

MALLINCKRODT PLC

CONDENSED CONSOLIDATING BALANCE SHEET

As of September 26, 2014

(unaudited, in millions)



	Mallinckrodt plc		Mallinckrodt International Finance S.A.		Other Subsidiaries		Eliminations			Consolidated
Assets
Current Assets:
Cash and cash equivalents	$	0.3	$	18.5	$	689.0	$	—		$	707.8
Accounts receivable, net	—		—		545.6		—			545.6
Inventories	—		—		396.6		—			396.6
Deferred income taxes	—		—		165.2		—			165.2
Prepaid expenses and other current assets	0.5		10.8		244.5		—			255.8
Intercompany receivable	13.5		—		25.7		(39.2		)	—
Total current assets	14.3		29.3		2,066.6		(39.2		)	2,071.0
Property, plant and equipment, net	—		—		949.2		—			949.2
Goodwill	—		—		2,401.9		—			2,401.9
Intangible assets, net	—		—		7,112.2		—			7,112.2
Investment in subsidiaries	586.8		10,645.7		4,945.1		(16,177.6		)	—
Intercompany loan receivable	4,385.0		—		1,941.6		(6,326.6		)	—
Other assets	—		76.5		254.0		—			330.5
Total Assets	$	4,986.1	$	10,751.5	$	19,670.6	$	(22,543.4	)	$	12,864.8

Liabilities and Shareholders' Equity
Current Liabilities:
Current maturities of long-term debt	$	—	$	18.2	$	3.0	$	—		$	21.2
Accounts payable	1.2		0.2		127.3		—			128.7
Accrued payroll and payroll-related costs	0.1		—		125.0		—			125.1
Accrued royalties	—		—		68.0		—			68.0
Accrued and other current liabilities	1.1		50.9		509.8		—			561.8
Intercompany payable	25.7		—		13.5		(39.2		)	—
Total current liabilities	28.1		69.3		846.6		(39.2		)	904.8
Long-term debt	—		3,770.4		181.1		—			3,951.5
Pension and postretirement benefits	—		—		119.1		—			119.1
Environmental liabilities	—		—		59.9		—			59.9
Deferred income taxes	—		—		2,398.6		—			2,398.6
Other income tax liabilities	—		—		122.6		—			122.6
Intercompany loans payable	—		1,966.6		4,360.0		(6,326.6		)	—
Other liabilities	—		—		350.3		—			350.3
Total liabilities	28.1		5,806.3		8,438.2		(6,365.8		)	7,906.8
Shareholders' Equity	4,958.0		4,945.2		11,232.4		(16,177.6		)	4,958.0
Total Liabilities and Shareholders' Equity	$	4,986.1	$	10,751.5	$	19,670.6	$	(22,543.4	)	$	12,864.8

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the three months ended March 27, 2015

(unaudited, in millions)



	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—		$	909.9		$	—		$	909.9
Cost of sales	—			—			421.4			—			421.4
Gross profit	—			—			488.5			—			488.5
Selling, general and administrative expenses	31.7			0.1			311.7			—			343.5
Research and development expenses	—			—			47.0			—			47.0
Restructuring charges, net	0.9			—			2.8			—			3.7
Gains on divestiture and license	—			—			(0.9		)	—			(0.9		)
Operating (loss) income	(32.6		)	(0.1		)	127.9			—			95.2

Interest expense	—			(49.0		)	(8.4		)	—			(57.4		)
Interest income	—			—			0.4			—			0.4
Other income (expense), net	138.9			—			(134.8		)	—			4.1
Intercompany interest and fees	(3.1		)	—			3.1			—			—
Equity in net income of subsidiaries	(4.4		)	44.7			(4.4		)	(35.9		)	—
Income from continuing operations before income taxes	98.8			(4.4		)	(16.2		)	(35.9		)	42.3
Income tax benefit	—			—			(34.2		)	—			(34.2		)
Income from continuing operations	98.8			(4.4		)	18.0			(35.9		)	76.5
Income from discontinued operations, net of income taxes	—			—			22.3			—			22.3
Net income	98.8			(4.4		)	40.3			(35.9		)	98.8
Other comprehensive loss, net of tax	(36.5		)	(36.5		)	(73.1		)	109.6			(36.5		)
Comprehensive income	$	62.3		$	(40.9	)	$	(32.8	)	$	73.7		$	62.3

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the three months ended March 28, 2014

(unaudited, in millions)



	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—		$	557.8		$	—		$	557.8
Cost of sales	—			—			295.2			—			295.2
Gross profit	—			—			262.6			—			262.6
Selling, general and administrative expenses	7.9			0.1			186.1			—			194.1
Research and development expenses	—			—			41.4			—			41.4
Separation costs	0.6			—			2.0			—			2.6
Restructuring charges, net	—			—			21.7			—			21.7
Gains on divestiture and license	—			—			(0.9		)	—			(0.9		)
Operating (loss) income	(8.5		)	(0.1		)	12.3			—			3.7

Interest expense	—			(12.8		)	0.4			—			(12.4		)
Interest income	—			—			0.5			—			0.5
Other income (expense), net	22.3			—			(22.7		)	—			(0.4		)
Intercompany interest and fees	(0.9		)	—			0.9			—			—
Equity in net income of subsidiaries	(1.1		)	11.7			—			(10.6		)	—
Income (loss) from continuing operations before income taxes	11.8			(1.2		)	(8.6		)	(10.6		)	(8.6		)
Income tax expense (benefit)	0.2			(0.1		)	(20.4		)	—			(20.3		)
Income (loss) from continuing operations	11.6			(1.1		)	11.8			(10.6		)	11.7
Loss from discontinued operations, net of income taxes	—			—			(0.1		)	—			(0.1		)
Net income (loss)	11.6			(1.1		)	11.7			(10.6		)	11.6
Other comprehensive loss, net of tax	(2.3		)	(2.3		)	(2.4		)	4.7			(2.3		)
Comprehensive income (loss)	$	9.3		$	(3.4	)	$	9.3		$	(5.9	)	$	9.3

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the six months ended March 27, 2015

(unaudited, in millions)



	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—		$	1,776.2		$	—		$	1,776.2
Cost of sales	—			—			849.0			—			849.0
Gross profit	—			—			927.2			—			927.2
Selling, general and administrative expenses	62.4			0.2			543.4			—			606.0
Research and development expenses	—			—			89.4			—			89.4
Restructuring charges, net	7.7			—			3.2			—			10.9
Gains on divestiture and license	—			—			(1.7		)	—			(1.7		)
Operating (loss) income	(70.1		)	(0.2		)	292.9			—			222.6

Interest expense	—			(97.7		)	(8.5		)	—			(106.2		)
Interest income	—			—			0.5			—			0.5
Other income (expense), net	142.4			—			(134.2		)	—			8.2
Intercompany interest and fees	(5.0		)	—			5.0			—			—
Equity in net income of subsidiaries	124.2			222.1			124.2			(470.5		)	—
Income from continuing operations before income taxes	191.5			124.2			279.9			(470.5		)	125.1
Income tax benefit	—			—			(43.5		)	—			(43.5		)
Income from continuing operations	191.5			124.2			323.4			(470.5		)	168.6
Income from discontinued operations, net of income taxes	—			—			22.9			—			22.9
Net income	191.5			124.2			346.3			(470.5		)	191.5
Other comprehensive loss, net of tax	(57.8		)	(57.8		)	(115.8		)	173.6			(57.8		)
Comprehensive income	$	133.7		$	66.4		$	230.5		$	(296.9	)	$	133.7

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the six months ended March 28, 2014

(unaudited, in millions)



	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—		$	1,098.0		$	—		$	1,098.0
Cost of sales	—			—			579.8			—			579.8
Gross profit	—			—			518.2			—			518.2
Selling, general and administrative expenses	11.9			0.2			328.2			—			340.3
Research and development expenses	—			—			80.4			—			80.4
Separation costs	1.4			—			3.4			—			4.8
Restructuring charges, net	—			—			29.7			—			29.7
Gains on divestiture and license	—			—			(13.8		)	—			(13.8		)
Operating (loss) income	(13.3		)	(0.2		)	90.3			—			76.8

Interest expense	—			(23.3		)	1.1			—			(22.2		)
Interest income	—			—			0.8			—			0.8
Other income (expense), net	23.0			—			(24.0		)	—			(1.0		)
Intercompany interest and fees	(4.0		)	—			4.0			—			—
Equity in net income of subsidiaries	51.5			74.9			—			(126.4		)	—
Income from continuing operations before income taxes	57.2			51.4			72.2			(126.4		)	54.4
Income tax benefit	—			(0.1		)	(3.6		)	—			(3.7		)
Income from continuing operations	57.2			51.5			75.8			(126.4		)	58.1
Loss from discontinued operations, net of income taxes	—			—			(0.9		)	—			(0.9		)
Net income	57.2			51.5			74.9			(126.4		)	57.2
Other comprehensive income, net of tax	(2.1		)	(2.1		)	(2.3		)	4.4			(2.1		)
Comprehensive income	$	55.1		$	49.4		$	72.6		$	(122.0	)	$	55.1

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the six months ended March 27, 2015

(unaudited, in millions)



	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Cash Flows From Operating Activities:
Net cash provided by (used in) operating activities	$	120.7		$	(78.3	)	$	323.1		$	—		$	365.5
Cash Flows From Investing Activities:
Capital expenditures	—			—			(55.1		)	—			(55.1		)
Intercompany loan investment	(127.3		)	—			(335.6		)	462.9			—
Investment in subsidiary	—			(124.9		)	—			124.9			—
Restricted cash	—			—			0.4			—			0.4
Other	—			—			1.7			—			1.7
Net cash (used in) provided by investing activities	(127.3		)	(124.9		)	(388.6		)	587.8			(53.0		)
Cash Flows From Financing Activities:
Issuance of external debt	—			—			80.0			—			80.0
Repayment of external debt and capital leases	—			(8.2		)	(55.3		)	—			(63.5		)
Debt financing costs	—			—			(0.4		)	—			(0.4		)
Excess tax benefit from share-based compensation	—			—			20.2			—			20.2
Proceeds from exercise of share options	20.6			—			—			—			20.6
Repurchase of shares	(12.3		)	—			—			—			(12.3		)
Intercompany loan borrowings, net	—			462.9			—			(462.9		)	—
Capital contribution	—			—			124.9			(124.9		)	—
Other	—			—			(4.0		)	—			(4.0		)
Net cash provided (used in) by financing activities	8.3			454.7			165.4			(587.8		)	40.6
Effect of currency rate changes on cash	—			—			(7.4		)	—			(7.4		)
Net increase in cash and cash equivalents	1.7			251.5			92.5			—			345.7
Cash and cash equivalents at beginning of period	0.3			18.5			689.0			—			707.8
Cash and cash equivalents at end of period	$	2.0		$	270.0		$	781.5		$	—		$	1,053.5

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the six months ended March 28, 2014

(unaudited, in millions)



	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Cash Flows From Operating Activities:
Net cash provided by (used in) operating activities	$	8.6		$	(17.1	)	$	149.7		$	—		$	141.2
Cash Flows From Investing Activities:
Capital expenditures	—			—			(50.7		)	—			(50.7		)
Intercompany loan investment	(21.5		)	2.4			(58.8		)	77.9			—
Investment in subsidiary	—			(1,300.0		)	—			1,300.0			—
Acquisitions and intangibles, net of cash acquired	—			—			(1,293.2		)	—			(1,293.2		)
Restricted cash	—			—			4.1			—			4.1
Other	—			—			8.0			—			8.0
Net cash used in investing activities	(21.5		)	(1,297.6		)	(1,390.6		)	1,377.9			(1,331.8		)
Cash Flows From Financing Activities:
Issuance of external debt	—			1,296.8			—			—			1,296.8
Repayment of external debt and capital leases	—			—			(30.8		)	—			(30.8		)
Debt financing costs	—			(32.2		)	—			—			(32.2		)
Excess tax benefit from share-based compensation	—			—			4.0			—			4.0
Proceeds from exercise of share options	16.1			—			—			—			16.1
Repurchase of shares	(1.8		)	—			—			—			(1.8		)
Intercompany loan borrowings, net	(2.4		)	80.3			—			(77.9		)	—
Capital contribution	—			—			1,300.0			(1,300.0		)	—
Other	—			—			—			—			—
Net cash provided by financing activities	11.9			1,344.9			1,273.2			(1,377.9		)	1,252.1
Effect of currency rate changes on cash	—			—			(2.1		)	—			(2.1		)
Net (decrease) increase in cash and cash equivalents	(1.0		)	30.2			30.2			—			59.4
Cash and cash equivalents at beginning of period	1.2			56.5			217.8			—			275.5
Cash and cash equivalents at end of period	$	0.2		$	86.7		$	248.0		$	—		$	334.9