Condensed Consolidating Financial Statements (Tables)

9 Months Ended

Sep. 29, 2017

Condensed Consolidating Financial Statements [Abstract]

Schedule of Condensed Consolidating Balance Sheets

MALLINCKRODT PLC

CONDENSED CONSOLIDATING BALANCE SHEET

As of September 29, 2017

(unaudited, in millions)

	Mallinckrodt plc		Mallinckrodt International Finance S.A.		Other Subsidiaries		Eliminations			Consolidated
Assets
Current Assets:
Cash and cash equivalents	$	0.7	$	37.6	$	333.5	$	—		$	371.8
Accounts receivable, net	—		—		464.3		—			464.3
Inventories	—		—		341.3		—			341.3
Prepaid expenses and other current assets	0.3		0.2		120.6		—			121.1
Notes receivable	—		—		154.0		—			154.0
Current assets held for sale	—		—		—		—			—
Intercompany receivables	127.9		246.8		694.1		(1,068.8		)	—
Total current assets	128.9		284.6		2,107.8		(1,068.8		)	1,452.5
Property, plant and equipment, net	—		—		962.4		—			962.4
Goodwill	—		—		3,459.5		—			3,459.5
Intangible assets, net	—		—		8,545.9		—			8,545.9
Investment in subsidiaries	4,923.4		21,531.2		10,654.1		(37,108.7		)	—
Intercompany loans receivable	744.8		—		4,710.0		(5,454.8		)	—
Other assets	—		—		191.6		—			191.6
Total Assets	$	5,797.1	$	21,815.8	$	30,631.3	$	(43,632.3	)	$	14,611.9
Liabilities and Shareholders' Equity
Current Liabilities:
Current maturities of long-term debt	$	—	$	318.0	$	0.2	$	—		$	318.2
Accounts payable	—		—		104.9		—			104.9
Accrued payroll and payroll-related costs	—		—		84.4		—			84.4
Accrued interest	—		77.5		0.6		—			78.1
Income taxes payable	—		—		28.1		—			28.1
Accrued and other current liabilities	1.3		0.4		438.7		—			440.4
Current liabilities held for sale	—		—		—		—			—
Intercompany payables	682.8		—		386.0		(1,068.8		)	—
Total current liabilities	684.1		395.9		1,042.9		(1,068.8		)	1,054.1
Long-term debt	—		5,303.3		214.1		—			5,517.4
Pension and postretirement benefits	—		—		67.5		—			67.5
Environmental liabilities	—		—		73.1		—			73.1
Deferred income taxes	—		—		2,294.1		—			2,294.1
Other income tax liabilities	—		—		78.5		—			78.5
Intercompany loans payable	—		5,454.8		—		(5,454.8		)	—
Other liabilities	—		7.7		406.5		—			414.2
Total Liabilities	684.1		11,161.7		4,176.7		(6,523.6		)	9,498.9
Shareholders' Equity	5,113.0		10,654.1		26,454.6		(37,108.7		)	5,113.0
Total Liabilities and Shareholders' Equity	$	5,797.1	$	21,815.8	$	30,631.3	$	(43,632.3	)	$	14,611.9

MALLINCKRODT PLC

CONDENSED CONSOLIDATING BALANCE SHEET

As of December 30, 2016

(unaudited, in millions)

	Mallinckrodt plc		Mallinckrodt International Finance S.A.		Other Subsidiaries		Eliminations			Consolidated
Assets
Current Assets:
Cash and cash equivalents	$	0.5	$	44.5	$	297.0	$	—		$	342.0
Accounts receivable, net	—		—		431.0		—			431.0
Inventories	—		—		350.7		—			350.7
Prepaid expenses and other current assets	1.0		—		130.9		—			131.9
Notes receivable	—		—		—		—			—
Current assets held for sale	—		—		310.9		—			310.9
Intercompany receivables	59.7		65.1		1,081.3		(1,206.1		)	—
Total current assets	61.2		109.6		2,601.8		(1,206.1		)	1,566.5
Property, plant and equipment, net	—		—		881.5		—			881.5
Goodwill	—		—		3,498.1		—			3,498.1
Intangible assets, net	—		—		9,000.5		—			9,000.5
Investment in subsidiaries	5,534.1		20,624.1		10,988.5		(37,146.7		)	—
Intercompany loans receivable	3.5		—		3,325.9		(3,329.4		)	—
Other assets	—		—		259.7		—			259.7
Total Assets	$	5,598.8	$	20,733.7	$	30,556.0	$	(41,682.2	)	$	15,206.3
Liabilities and Shareholders' Equity
Current Liabilities:
Current maturities of long-term debt	$	—	$	19.7	$	251.5	$	—		$	271.2
Accounts payable	0.1		0.1		111.9		—			112.1
Accrued payroll and payroll-related costs	—		—		76.1		—			76.1
Accrued interest	—		53.9		14.8		—			68.7
Income taxes payable	—		—		101.7		—			101.7
Accrued and other current liabilities	1.9		7.5		547.7		—			557.1
Current liabilities held for sale	—		—		120.3		—			120.3
Intercompany payables	612.5		467.1		126.5		(1,206.1		)	—
Total current liabilities	614.5		548.3		1,350.5		(1,206.1		)	1,307.2
Long-term debt	—		5,860.6		20.2		—			5,880.8
Pension and postretirement benefits	—		—		136.4		—			136.4
Environmental liabilities	—		—		73.0		—			73.0
Deferred income taxes	—		—		2,398.1		—			2,398.1
Other income tax liabilities	—		—		70.4		—			70.4
Intercompany loans payable	—		3,329.4		—		(3,329.4		)	—
Other liabilities	—		7.0		349.1		—			356.1
Total Liabilities	614.5		9,745.3		4,397.7		(4,535.5		)	10,222.0
Shareholders' Equity	4,984.3		10,988.4		26,158.3		(37,146.7		)	4,984.3
Total Liabilities and Shareholders' Equity	$	5,598.8	$	20,733.7	$	30,556.0	$	(41,682.2	)	$	15,206.3

Schedule of Condensed Consolidating Statements of Comprehensive Income

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the three months ended September 29, 2017

(unaudited, in millions)

	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—		$	793.9		$	—		$	793.9
Cost of sales	0.9			—			392.4			—			393.3
Gross profit	(0.9		)	—			401.5			—			400.6
Selling, general and administrative expenses	13.4			0.2			192.1			—			205.7
Research and development expenses	1.8			—			57.7			—			59.5
Restructuring charges, net	—			—			14.3			—			14.3
Non-restructuring impairment charges	—			—			—			—			—
Losses on divestiture and license	—			—			0.4			—			0.4
Operating (loss) income	(16.1		)	(0.2		)	137.0			—			120.7
Interest expense	(3.3		)	(90.9		)	(19.0		)	20.6			(92.6		)
Interest income	2.2			0.4			19.3			(20.6		)	1.3
Other income, net	1.4			1.7			0.6			—			3.7
Intercompany fees	(4.3		)	—			4.3			—			—
Equity in net income of subsidiaries	82.4			261.8			174.7			(518.9		)	—
Income from continuing operations before income taxes	62.3			172.8			316.9			(518.9		)	33.1
Income tax benefit	(1.4		)	(2.1		)	(27.7		)	—			(31.2		)
Income from continuing operations	63.7			174.9			344.6			(518.9		)	64.3
Loss from discontinued operations, net of income taxes	—			(0.2		)	(0.4		)	—			(0.6		)
Net income	63.7			174.7			344.2			(518.9		)	63.7
Other comprehensive loss, net of tax	(5.1		)	(5.1		)	(10.5		)	15.6			(5.1		)
Comprehensive income	$	58.6		$	169.6		$	333.7		$	(503.3	)	$	58.6

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the three months ended September 30, 2016

(unaudited, in millions)

	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—		$	887.2		$	—		$	887.2
Cost of sales	—			—			397.0			—			397.0
Gross profit	—			—			490.2			—			490.2
Selling, general and administrative expenses	14.7			0.1			253.0			—			267.8
Research and development expenses	—			—			67.9			—			67.9
Restructuring charges, net	—			—			6.8			—			6.8
Non-restructuring impairment charge	—			—			—			—			—
Losses on divestiture and license	—			—			—			—			—
Operating (loss) income	(14.7		)	(0.1		)	162.5			—			147.7
Interest expense	(36.1		)	(82.0		)	(19.4		)	43.5			(94.0		)
Interest income	—			0.2			43.8			(43.5		)	0.5
Other income (expense), net	7.4			—			(8.0		)	—			(0.6		)
Intercompany fees	(5.6		)	—			5.6			—			—
Equity in net income of subsidiaries	157.1			302.7			224.5			(684.3		)	—
Income from continuing operations before income taxes	108.1			220.8			409.0			(684.3		)	53.6
Income tax benefit	(6.9		)	(4.1		)	(45.4		)	—			(56.4		)
Income from continuing operations	115.0			224.9			454.4			(684.3		)	110.0
(Loss) income from discontinued operations, net of income taxes	—			(0.4		)	5.4			—			5.0
Net income	115.0			224.5			459.8			(684.3		)	115.0
Other comprehensive loss, net of tax	(19.9		)	(19.9		)	(39.8		)	59.7			(19.9		)
Comprehensive income	$	95.1		$	204.6		$	420.0		$	(624.6	)	$	95.1

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the nine months ended September 29, 2017

(unaudited, in millions)

	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—		$	2,429.3		$	—		$	2,429.3
Cost of sales	1.8			—			1,192.2			—			1,194.0
Gross profit	(1.8		)	—			1,237.1			—			1,235.3
Selling, general and administrative expenses	46.7			0.6			698.6			—			745.9
Research and development expenses	3.6			—			187.3			—			190.9
Restructuring charges, net	—			—			32.1			—			32.1
Non-restructuring impairment charge	—			—			—			—			—
Gains on divestiture and license	—			—			(56.6		)	—			(56.6		)
Operating income	(52.1		)	(0.6		)	375.7			—			323.0
Interest expense	(10.0		)	(264.9		)	(57.9		)	53.8			(279.0		)
Interest income	5.3			1.0			50.3			(53.8		)	2.8
Other income (expense), net	19.0			(1.6		)	(11.2		)	—			6.2
Intercompany fees	(13.3		)	—			13.3			—			—
Equity in net income of subsidiaries	572.1			1,113.5			848.1			(2,533.7		)	—
Income from continuing operations before income taxes	521.0			847.4			1,218.3			(2,533.7		)	53.0
Income tax benefit	(4.7		)	(2.6		)	(103.5		)	—			(110.8		)
Income from continuing operations	525.7			850.0			1,321.8			(2,533.7		)	163.8
(Loss) income from discontinued operations, net of income taxes	—			(1.9		)	363.8			—			361.9
Net income	525.7			848.1			1,685.6			(2,533.7		)	525.7
Other comprehensive income, net of tax	59.4			59.4			117.9			(177.3		)	59.4
Comprehensive income	$	585.1		$	907.5		$	1,803.5		$	(2,711.0	)	$	585.1

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME

For the nine months ended September 30, 2016

(unaudited, in millions)

	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Net sales	$	—		$	—		$	2,569.6		$	—		$	2,569.6
Cost of sales	—			—			1,165.5			—			1,165.5
Gross profit	—			—			1,404.1			—			1,404.1
Selling, general and administrative expenses	40.9			0.5			660.6			—			702.0
Research and development expenses	—			—			200.8			—			200.8
Restructuring charges, net	—			—			29.2			—			29.2
Non-restructuring impairment charge	—			—			16.9			—			16.9
Gains on divestiture and license	—			—			—			—			—
Operating income	(40.9		)	(0.5		)	496.6			—			455.2
Interest expense	(162.3		)	(245.1		)	(61.4		)	182.0			(286.8		)
Interest income	—			0.5			182.6			(182.0		)	1.1
Other income (expense), net	22.3			—			(24.9		)	—			(2.6		)
Intercompany fees	(12.9		)	0.1			12.8			—			—
Equity in net income of subsidiaries	609.8			1,015.2			786.2			(2,411.2		)	—
Income from continuing operations before income taxes	416.0			770.2			1,391.9			(2,411.2		)	166.9
Income tax benefit	(16.6		)	(18.1		)	(183.6		)	—			(218.3		)
Income from continuing operations	432.6			788.3			1,575.5			(2,411.2		)	385.2
(Loss) income from discontinued operations, net of income taxes	—			(2.1		)	49.5			—			47.4
Net income	432.6			786.2			1,625.0			(2,411.2		)	432.6
Other comprehensive loss, net of tax	(20.3		)	(20.3		)	(41.0		)	61.3			(20.3		)
Comprehensive income	$	412.3		$	765.9		$	1,584.0		$	(2,349.9	)	$	412.3

Schedule of Condensed Consolidating Statements of Cash Flows

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the nine months ended September 29, 2017

(unaudited, in millions)

	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Cash Flows From Operating Activities:
Net cash from operating activities	$	1,172.0		$	1,233.7		$	1,963.0		$	(3,920.2	)	$	448.5
Cash Flows From Investing Activities:
Capital expenditures	—			—			(151.3		)	—			(151.3		)
Acquisitions and intangibles, net of cash acquired	—			—			(35.9		)	—			(35.9		)
Proceeds from divestiture of discontinued operations, net of cash	—			—			576.9			—			576.9
Intercompany loan investment, net	(741.3		)	—			(920.8		)	1,662.1			—
Investment in subsidiary	—			(1,412.5		)	—			1,412.5			—
Other	—			—			0.5			—			0.5
Net cash from investing activities	(741.3		)	(1,412.5		)	(530.6		)	3,074.6			390.2
Cash Flows From Financing Activities:
Issuance of external debt	—			500.0			40.0			—			540.0
Repayment of external debt and capital leases	—			(759.9		)	(127.6		)	—			(887.5		)
Debt financing costs	—			(12.7		)	—			—			(12.7		)
Proceeds from exercise of share options	4.0			—			—			—			4.0
Repurchase of shares	(437.7		)	—			—			—			(437.7		)
Intercompany loan borrowings, net	—			1,614.5			47.6			(1,662.1		)	—
Intercompany dividends	—			(1,170.0		)	(2,750.2		)	3,920.2			—
Capital contribution	—			—			1,412.5			(1,412.5		)	—
Other	3.2			—			(21.8		)	—			(18.6		)
Net cash from financing activities	(430.5		)	171.9			(1,399.5		)	845.6			(812.5		)
Effect of currency rate changes on cash	—			—			2.7			—			2.7
Net change in cash, cash equivalents and restricted cash	0.2			(6.9		)	35.6			—			28.9
Cash, cash equivalents and restricted cash at beginning of period	0.5			44.5			316.1			—			361.1
Cash, cash equivalents and restricted cash at end of period	$	0.7		$	37.6		$	351.7		$	—		$	390.0
Cash and cash equivalents at end of period	$	0.7		$	37.6		$	333.5		$	—		$	371.8
Restricted Cash, current at end of period	—			—			—			—			—
Restricted Cash, noncurrent at end of period	—			—			18.2			—			18.2
Cash, cash equivalents and restricted cash at end of period	$	0.7		$	37.6		$	351.7		$	—		$	390.0

MALLINCKRODT PLC

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the nine months ended September 30, 2016

(unaudited, in millions)

	Mallinckrodt plc			Mallinckrodt International Finance S.A.			Other Subsidiaries			Eliminations			Consolidated
Cash Flows From Operating Activities:
Net cash from operating activities	$	(21.3	)	$	(99.3	)	$	993.8		$	—		$	873.2
Cash Flows From Investing Activities:
Capital expenditures	—			—			(133.9		)	—			(133.9		)
Acquisitions and intangibles, net of cash acquired	—			—			(245.4		)	—			(245.4		)
Proceeds from divestiture of discontinued operations, net of cash	—			(1.4		)	4.4			—			3.0
Intercompany loan investment, net	—			(69.4		)	(1,587.5		)	1,656.9			—
Investment in subsidiary	—			(815.0		)	—			815.0			—
Proceeds from sale of subsidiary	3.4			—			—			(3.4		)	—
Acquisition of subsidiary	—			—			(3.4		)	3.4			—
Other	—			—			5.3			—			5.3
Net cash from investing activities	3.4			(885.8		)	(1,960.5		)	2,471.9			(371.0		)
Cash Flows From Financing Activities:
Issuance of external debt	—			—			36.3			—			36.3
Repayment of external debt and capital leases	—			(420.3		)	(18.7		)	—			(439.0		)
Debt financing costs	—			—			—			—			—
Proceeds from exercise of share options	10.4			—			—			—			10.4
Repurchase of shares	(377.5		)	—			—			—			(377.5		)
Intercompany loan borrowings, net	385.0			1,271.9			—			(1,656.9		)	—
Capital contribution	—			—			815.0			(815.0		)	—
Other	—			—			(23.0		)	—			(23.0		)
Net cash from financing activities	17.9			851.6			809.6			(2,471.9		)	(792.8		)
Effect of currency rate changes on cash	—			—			1.8			—			1.8
Net change in cash, cash equivalents and restricted cash	—			(133.5		)	(155.3		)	—			(288.8		)
Cash, cash equivalents and restricted cash at beginning of period	0.3			158.5			429.6			—			588.4
Cash, cash equivalents and restricted cash at end of period	$	0.3		$	25.0		$	274.3		$	—		$	299.6
Cash and cash equivalents at end of period	$	0.3		$	25.0		$	255.2		$	—		$	280.5
Restricted Cash, current at end of period	—			—			0.1			—			0.1
Restricted Cash, noncurrent at end of period	—			—			19.0			—			19.0
Cash, cash equivalents and restricted cash at end of period	$	0.3		$	25.0		$	274.3		$	—		$	299.6