

19.	Condensed Consolidating Financial Statements

Mallinckrodt International Finance, S.A. ("MIFSA"), an indirectly 100%-owned subsidiary of Mallinckrodt plc, is the borrower under the 3.50% notes due April 2018 and the 4.75% notes due April 2023 (collectively, "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 nine months ended June 24, 2016 and June 26, 2015, and as of June 24, 2016 and September 25, 2015. 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 June 24, 2016

(unaudited, in millions)



	Mallinckrodt plc		Mallinckrodt International Finance S.A.		Other Subsidiaries		Eliminations			Consolidated
Assets
Current Assets:
Cash and cash equivalents	$	0.1	$	88.8	$	433.0	$	—		$	521.9
Accounts receivable, net	—		—		500.0		—			500.0
Inventories	—		—		357.7		—			357.7
Deferred income taxes	—		—		115.7		—			115.7
Prepaid expenses and other current assets	0.7		0.3		130.0		—			131.0
Intercompany receivables	69.2		14.7		3,250.2		(3,334.1		)	—
Total current assets	70.0		103.8		4,786.6		(3,334.1		)	1,626.3
Property, plant and equipment, net	—		—		1,012.0		—			1,012.0
Goodwill	—		—		3,645.5		—			3,645.5
Intangible assets, net	—		—		9,258.5		—			9,258.5
Investment in subsidiaries	7,549.6		20,026.8		10,815.4		(38,391.8		)	—
Intercompany loans receivable	202.8		—		2,346.6		(2,549.4		)	—
Other assets	—		—		290.9		—			290.9
Total Assets	$	7,822.4	$	20,130.6	$	32,155.5	$	(44,275.3	)	$	15,833.2

Liabilities and Shareholders' Equity
Current Liabilities:
Current maturities of long-term debt	$	—	$	19.7	$	2.0	$	—		$	21.7
Accounts payable	—		—		125.4		—			125.4
Accrued payroll and payroll-related costs	—		—		110.5		—			110.5
Accrued interest	—		69.5		0.4		—			69.9
Accrued and other current liabilities	1.3		8.6		632.1		—			642.0
Intercompany payables	2,612.3		638.0		83.8		(3,334.1		)	—
Total current liabilities	2,613.6		735.8		954.2		(3,334.1		)	969.5
Long-term debt	—		6,023.2		255.8		—			6,279.0
Pension and postretirement benefits	—		—		136.4		—			136.4
Environmental liabilities	—		—		73.2		—			73.2
Deferred income taxes	—		—		2,772.5		—			2,772.5
Other income tax liabilities	—		—		95.3		—			95.3
Intercompany loans payable	—		2,549.4		—		(2,549.4		)	—
Other liabilities	—		6.8		291.7		—			298.5
Total Liabilities	2,613.6		9,315.2		4,579.1		(5,883.5		)	10,624.4
Shareholders' Equity	5,208.8		10,815.4		27,576.4		(38,391.8		)	5,208.8
Total Liabilities and Shareholders' Equity	$	7,822.4	$	20,130.6	$	32,155.5	$	(44,275.3	)	$	15,833.2

MALLINCKRODT PLC

CONDENSED CONSOLIDATING BALANCE SHEET

As of September 25, 2015

(unaudited, in millions)



	Mallinckrodt plc		Mallinckrodt International Finance S.A.		Other Subsidiaries		Eliminations			Consolidated
Assets
Current Assets:
Cash and cash equivalents	$	0.1	$	152.1	$	213.7	$	—		$	365.9
Accounts receivable, net	—		—		548.5		—			548.5
Inventories	—		—		281.8		—			281.8
Deferred income taxes	—		—		142.7		—			142.7
Prepaid expenses and other current assets	1.3		0.2		205.8		—			207.3
Current assets held for sale	—		—		299.9		—			299.9
Intercompany receivables	39.1		128.6		9,699.5		(9,867.2		)	—
Total current assets	40.5		280.9		11,391.9		(9,867.2		)	1,846.1
Property, plant and equipment, net	—		—		991.3		—			991.3
Goodwill	—		—		3,649.4		—			3,649.4
Intangible assets, net	—		—		9,666.3		—			9,666.3
Investment in subsidiaries	14,797.7		18,838.6		10,050.0		(43,686.3		)	—
Intercompany loans receivable	174.4		—		2,498.2		(2,672.6		)	—
Other assets	—		0.1		250.9		—			251.0
Total Assets	$	15,012.6	$	19,119.6	$	38,498.0	$	(56,226.1	)	$	16,404.1

Liabilities and Shareholders' Equity
Current Liabilities:
Current maturities of long-term debt	$	—	$	20.0	$	2.3	$	—		$	22.3
Accounts payable	—		0.2		132.8		—			133.0
Accrued payroll and payroll-related costs	0.1		—		103.6		—			103.7
Accrued interest	—		77.1		3.1		—			80.2
Accrued and other current liabilities	1.8		0.3		515.3		—			517.4
Current liabilities held for sale	—		—		72.8		—			72.8
Intercompany payables	9,699.5		—		167.7		(9,867.2		)	—
Total current liabilities	9,701.4		97.6		997.6		(9,867.2		)	929.4
Long-term debt	—		6,299.4		174.9		—			6,474.3
Pension and postretirement benefits	—		—		116.7		—			116.7
Environmental liabilities	—		—		73.3		—			73.3
Deferred income taxes	—		—		3,132.4		—			3,132.4
Other income tax liabilities	—		—		121.3		—			121.3
Intercompany loans payable	—		2,672.6		—		(2,672.6		)	—
Other liabilities	—		—		245.5		—			245.5
Total Liabilities	9,701.4		9,069.6		4,861.7		(12,539.8		)	11,092.9
Shareholders' Equity	5,311.2		10,050.0		33,636.3		(43,686.3		)	5,311.2
Total Liabilities and Shareholders' Equity	$	15,012.6	$	19,119.6	$	38,498.0	$	(56,226.1	)	$	16,404.1

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the three months ended June 24, 2016

(unaudited, in millions)



	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—		$	970.6		$	—		$	970.6
Cost of sales	—			—			429.3			—			429.3
Gross profit	—			—			541.3			—			541.3
Selling, general and administrative expenses	12.3			0.2			235.9			—			248.4
Research and development expenses	—			—			76.1			—			76.1
Restructuring charges, net	—			—			14.1			—			14.1
Gains on divestiture and license	—			—			(0.2		)	—			(0.2		)
Operating (loss) income	(12.3		)	(0.2		)	215.4			—			202.9

Interest expense	(56.3		)	(81.6		)	(20.3		)	62.6			(95.6		)
Interest income	—			0.1			62.9			(62.6		)	0.4
Other income (expense), net	2.6			0.1			(4.0		)	—			(1.3		)
Intercompany fees	(4.5		)	—			4.5			—			—
Equity in net income of subsidiaries	260.2			380.5			308.9			(949.6		)	—
Income from continuing operations before income taxes	189.7			298.9			567.4			(949.6		)	106.4
Income tax benefit	(9.6		)	(10.2		)	(69.5		)	—			(89.3		)
Income from continuing operations	199.3			309.1			636.9			(949.6		)	195.7
Income (loss) from discontinued operations, net of income taxes	—			(0.2		)	3.8			—			3.6
Net income	199.3			308.9			640.7			(949.6		)	199.3
Other comprehensive loss, net of tax	(0.6		)	(0.6		)	(1.4		)	2.0			(0.6		)
Comprehensive income	$	198.7		$	308.3		$	639.3		$	(947.6	)	$	198.7

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the three months ended June 26, 2015

(unaudited, in millions)



	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—		$	877.3		$	—		$	877.3
Cost of sales	—			—			373.5			—			373.5
Gross profit	—			—			503.8			—			503.8
Selling, general and administrative expenses	29.5			9.1			256.4			—			295.0
Research and development expenses	—			—			59.9			—			59.9
Restructuring charges, net	1.5			—			21.2			—			22.7
Gains on divestiture and license	—			—			(0.9		)	—			(0.9		)
Operating (loss) income	(31.0		)	(9.1		)	167.2			—			127.1

Interest expense	(20.9		)	(64.4		)	(8.1		)	20.9			(72.5		)
Interest income	—			—			21.1			(20.9		)	0.2
Other income (expense), net	46.3			—			(46.7		)	—			(0.4		)
Intercompany fees	(3.9		)	—			3.9			—			—
Equity in net income of subsidiaries	61.4			120.1			46.6			(228.1		)	—
Income (loss) from continuing operations before income taxes	51.9			46.6			184.0			(228.1		)	54.4
Income tax benefit	(6.1		)	—			4.9			—			(1.2		)
Income from continuing operations	58.0			46.6			179.1			(228.1		)	55.6
Income from discontinued operations, net of income taxes	—			—			2.4			—			2.4
Net income	58.0			46.6			181.5			(228.1		)	58.0
Other comprehensive income, net of tax	9.8			9.8			19.4			(29.2		)	9.8
Comprehensive income	$	67.8		$	56.4		$	200.9		$	(257.3	)	$	67.8

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the nine months ended June 24, 2016

(unaudited, in millions)



	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—		$	2,803.4		$	—		$	2,803.4
Cost of sales	—			—			1,290.8			—			1,290.8
Gross profit	—			—			1,512.6			—			1,512.6
Selling, general and administrative expenses	36.6			0.7			684.8			—			722.1
Research and development expenses	—			—			198.3			—			198.3
Restructuring charges, net	—			—			29.1			—			29.1
Non-restructuring impairment charges	—			—			16.9			—			16.9
Gains on divestiture and license	—			—			(0.5		)	—			(0.5		)
Operating (loss) income	(36.6		)	(0.7		)	584.0			—			546.7

Interest expense	(194.2		)	(245.0		)	(63.0		)	211.6			(290.6		)
Interest income	—			0.3			212.1			(211.6		)	0.8
Other income (expense), net	82.6			1.7			(84.3		)	—			—
Intercompany fees	(10.5		)	—			10.5			—			—
Equity in net income of subsidiaries	663.7			1,024.5			833.4			(2,521.6		)	—
Income from continuing operations before income taxes	505.0			780.8			1,492.7			(2,521.6		)	256.9
Income tax benefit	(23.7		)	(14.0		)	(137.3		)	—			(175.0		)
Income from continuing operations	528.7			794.8			1,630.0			(2,521.6		)	431.9
Income from discontinued operations, net of income taxes	—			38.6			58.2			—			96.8
Net income	528.7			833.4			1,688.2			(2,521.6		)	528.7
Other comprehensive loss, net of tax	(66.6		)	(66.6		)	(133.7		)	200.3			(66.6		)
Comprehensive income	$	462.1		$	766.8		$	1,554.5		$	(2,321.3	)	$	462.1

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the nine months ended June 26, 2015

(unaudited, in millions)



	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—		$	2,464.5		$	—		$	2,464.5
Cost of sales	—			—			1,093.0			—			1,093.0
Gross profit	—			—			1,371.5			—			1,371.5
Selling, general and administrative expenses	91.9			9.3			726.3			—			827.5
Research and development expenses	—			—			170.6			—			170.6
Restructuring charges, net	9.2			—			24.2			—			33.4
Gains on divestiture and license	—			—			(2.6		)	—			(2.6		)
Operating (loss) income	(101.1		)	(9.3		)	453.0			—			342.6

Interest expense	(20.9		)	(162.1		)	(16.6		)	20.9			(178.7		)
Interest income	—			—			21.6			(20.9		)	0.7
Other income (expense), net	188.7			—			(180.7		)	—			8.0
Intercompany fees	(8.9		)	—			8.9			—			—
Equity in net income of subsidiaries	185.6			342.2			170.8			(698.6		)	—
Income from continuing operations before income taxes	243.4			170.8			457.0			(698.6		)	172.6
Income tax benefit	(6.1		)	—			(39.5		)	—			(45.6		)
Income from continuing operations	249.5			170.8			496.5			(698.6		)	218.2
Income from discontinued operations, net of income taxes	—			—			31.3			—			31.3
Net income	249.5			170.8			527.8			(698.6		)	249.5
Other comprehensive loss, net of tax	(48.0		)	(48.0		)	(96.4		)	144.4			(48.0		)
Comprehensive income	$	201.5		$	122.8		$	431.4		$	(554.2	)	$	201.5

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the nine months ended June 24, 2016

(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	$	34.9		$	(21.0	)	$	980.5		$	—		$	994.4
Cash Flows From Investing Activities:
Capital expenditures	—			—			(133.5		)	—			(133.5		)
Acquisitions and intangibles, net of cash acquired	—			—			(169.5		)	—			(169.5		)
Proceeds from disposal of discontinued operations, net of cash	—			234.0			33.0			—			267.0
Intercompany loan investment, net	—			—			(1,079.4		)	1,079.4			—
Investment in subsidiary	—			(507.9		)	—			507.9			—
Restricted cash	—			—			47.1			—			47.1
Other	—			—			5.3			—			5.3
Net cash used in investing activities	—			(273.9		)	(1,297.0		)	1,587.3			16.4
Cash Flows From Financing Activities:
Issuance of external debt	—			—			98.3			—			98.3
Repayment of external debt and capital leases	—			(289.2		)	(17.9		)	—			(307.1		)
Debt financing costs	—			—			(0.1		)	—			(0.1		)
Proceeds from exercise of share options	8.5			—			—			—			8.5
Repurchase of shares	(602.0		)	—			—			—			(602.0		)
Intercompany loan borrowings, net	558.6			520.8			—			(1,079.4		)	—
Capital contribution	—			—			507.9			(507.9		)	—
Other	—			—			(53.0		)	—			(53.0		)
Net cash (used in) provided by financing activities	(34.9		)	231.6			535.2			(1,587.3		)	(855.4		)
Effect of currency rate changes on cash	—			—			0.6			—			0.6
Net increase (decrease) in cash and cash equivalents	—			(63.3		)	219.3			—			156.0
Cash and cash equivalents at beginning of period	0.1			152.1			213.7			—			365.9
Cash and cash equivalents at end of period	$	0.1		$	88.8		$	433.0		$	—		$	521.9

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the nine months ended June 26, 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	$	164.2		$	(84.0	)	$	479.0		$	—		$	559.2
Cash Flows From Investing Activities:
Capital expenditures	—			—			(92.5		)	—			(92.5		)
Acquisition, net of cash acquired	—			—			(1,176.3		)	—			(1,176.3		)
Intercompany loan investment, net	(178.6		)	—			(235.0		)	413.6			—
Investment in subsidiary	—			(1,659.9		)	—			1,659.9			—
Restricted cash	—			—			(21.9		)	—			(21.9		)
Other	—			—			2.6			—			2.6
Net cash used in investing activities	(178.6		)	(1,659.9		)	(1,523.1		)	2,073.5			(1,288.1		)
Cash Flows From Financing Activities:
Issuance of external debt	—			1,640.0			80.0			—			1,720.0
Repayment of external debt and capital leases	—			(253.3		)	(1,204.5		)	—			(1,457.8		)
Debt financing costs	—			(25.0		)	(0.3		)	—			(25.3		)
Excess tax benefit from share-based compensation	—			—			30.4			—			30.4
Proceeds from exercise of share options	29.7			—			—			—			29.7
Repurchase of shares	(15.4		)	—			—			—			(15.4		)
Intercompany loan borrowings, net	—			413.6			—			(413.6		)	—
Capital contribution	—			—			1,659.9			(1,659.9		)	—
Other	—			—			(28.1		)	—			(28.1		)
Net cash provided by financing activities	14.3			1,775.3			537.4			(2,073.5		)	253.5
Effect of currency rate changes on cash	—			—			(7.1		)	—			(7.1		)
Net (decrease) increase in cash and cash equivalents	(0.1		)	31.4			(513.8		)	—			(482.5		)
Cash and cash equivalents at beginning of period	0.3			18.5			689.0			—			707.8
Cash and cash equivalents at end of period	$	0.2		$	49.9		$	175.2		$	—		$	225.3