EX-99.1 2 mnkexhibit991q32021.htm EX-99.1 Document

Exhibit 99.1

MALLINCKRODT PLC
(DEBTOR-IN-POSSESSION)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in millions, except per share data)
Three Months Ended
September 24,
2021		Percent of
Net sales		September 25,
2020		Percent of
Net sales
Net sales
$507.2 100.0 %$698.3 100.0 %
Cost of sales319.2 62.9 403.0 57.7 
Gross profit188.0 37.1 295.3 42.3 
Selling, general and administrative expenses127.3 25.1 220.8 31.6 
Research and development expenses47.3 9.3 65.5 9.4 
Restructuring charges, net11.0 2.2 3.2 0.5 
Gains on divestiture— — (9.7)(1.4)
Opioid-related litigation settlement loss (gain)125.0 24.6 (25.8)(3.7)
Medicaid lawsuit— — (0.2)— 
Operating (loss) income(122.6)(24.2)41.5 5.9 
Interest expense(48.7)(9.6)(62.2)(8.9)
Interest income— — 0.9 0.1 
Other expense, net(3.5)(0.7)— — 
Reorganization items, net(126.2)(24.9)— — 
Loss from continuing operations before income taxes(301.0)(59.3)(19.8)(2.8)
Income tax benefit(32.0)(6.3)(211.6)(30.3)
(Loss) income from continuing operations(269.0)(53.0)191.8 27.5 
Income (loss) from discontinued operations, net of income taxes5.3 1.0 (0.2)— 
Net (loss) income$(263.7)(52.0)%$191.6 27.4 %
Basic (loss) income per share:
(Loss) income from continuing operations$(3.18)$2.27 
Income (loss) from discontinued operations0.06 — 
Net (loss) income$(3.11)$2.26 
Diluted (loss) income per share:
(Loss) income from continuing operations$(3.18)$2.27 
Income (loss) from discontinued operations0.06 — 
Net (loss) income$(3.11)$2.26 
Weighted-average number of shares outstanding
Basic84.784.6
Diluted84.784.6




1

MALLINCKRODT PLC
(DEBTOR-IN-POSSESSION)
CONSOLIDATED ADJUSTED EBITDA
(unaudited, in millions)
Three Months Ended
September 24, 2021September 25, 2020
Gross ProfitSG&AR&DAdjusted EBITDAGross ProfitSG&AR&DAdjusted EBITDA
Net loss$188.0 $127.3 $47.3 $(263.7)$295.3 $220.8 $65.5 $191.6 
Adjustments:
Interest expense, net— — — 48.7 — — — 61.3 
Income taxes— — — (32.0)— — — (211.6)
Depreciation (1)
17.3 (4.3)(1.6)23.2 18.3 (5.5)(1.7)25.5 
Amortization144.5 (0.8)— 145.3 209.7 (0.9)— 210.6 
Restructuring charges, net— — — 11.0 — — — 3.2 
(Income) loss from discontinued operations— — — (5.3)— — — 0.2 
Change in contingent consideration fair value— 2.1 — (2.1)— (8.1)— 8.1 
Significant legal and environmental charges— — — 125.0 0.7 (13.4)— (11.9)
Gains on divestiture— — — — — — — (9.7)
Separation costs— (0.1)— 0.1 — (33.0)— 33.0 
Unrealized loss on equity investment— — — 6.9 — — — 0.8 
Reorganization items, net— — — 126.2 — — — — 
Share-based compensation 0.1 (1.9)(0.4)2.4 0.2 (3.4)(0.7)4.3 
As adjusted:$349.9 $122.3 $45.3 $185.7 $524.2 $156.5 $63.1 $305.4 
(1)Includes $0.7 millions of accelerated depreciation in selling general and administrative ("SG&A") related to restructuring charges incurred during the three months ended September 24, 2021.



2

MALLINCKRODT PLC
(DEBTOR-IN-POSSESSION)
SEGMENT OPERATING INCOME
(unaudited, in millions)
Three Months Ended
September 24,
2021		September 25,
2020
Specialty Brands$189.9 $291.8 
Specialty Generics15.2 43.1 
Segment operating income205.1 334.9 
Unallocated amounts:
Corporate and unallocated expenses (1)
(20.8)(42.1)
Depreciation and amortization(168.4)(236.1)
Share-based compensation(2.4)(4.3)
Restructuring charges, net(11.0)(3.2)
Separation costs(0.1)(33.0)
Opioid-related litigation settlement (loss) gain(125.0)25.8 
Medicaid lawsuit— (0.5)
Operating (loss) income$(122.6)$41.5 
(1)Includes administration expenses and certain compensation, legal, environmental and other costs not charged to the Company's reportable segments.
3

MALLINCKRODT PLC
(DEBTOR-IN-POSSESSION)
SEGMENT NET SALES AND CONSTANT-CURRENCY GROWTH
(unaudited, in millions)
Three Months Ended
September 24,
2021		September 25,
2020		Percent
change		Currency impactConstant-currency growth
Specialty Brands$359.7 $539.6 (33.3)%0.1 %(33.4)%
Specialty Generics147.5 159.4 (7.5)0.1 (7.6)
Segment net sales507.2 699.0 (27.4)0.1 (27.5)
Medicaid lawsuit— (0.7)***
Net sales$507.2 $698.3 (27.4)%0.1 %(27.5)%
*Not meaningful


MALLINCKRODT PLC
(DEBTOR-IN-POSSESSION)
SELECT PRODUCT LINE NET SALES AND CONSTANT-CURRENCY GROWTH
(unaudited, in millions)
Three Months Ended
September 24,
2021		September 25,
2020		Percent
change		Currency impactConstant-currency growth
Specialty Brands
Acthar Gel $143.4 $195.3 (26.6)%— %(26.6)%
INOmax98.4 141.9 (30.7)— (30.7)
Ofirmev4.7 88.7 (94.7)— (94.7)
Therakos62.5 62.6 (0.2)0.7 (0.9)
Amitiza49.6 47.7 4.0 — 4.0 
Other1.1 3.4 (67.6)— (67.6)
Specialty Brands Total359.7 539.6 (33.3)0.1 (33.4)
Specialty Generics
Hydrocodone (API) and hydrocodone-containing tablets16.9 20.0 (15.5)— (15.5)
Oxycodone (API) and oxycodone-containing tablets15.2 16.1 (5.6)— (5.6)
Acetaminophen (API)49.6 54.9 (9.7)— (9.7)
Other controlled substances60.8 62.4 (2.6)0.3 (2.9)
Other5.0 6.0 (16.7)— (16.7)
Specialty Generics Total147.5 159.4 (7.5)0.1 (7.6)
Segment net sales507.2 699.0 (27.4)0.1 (27.5)
Medicaid lawsuit— (0.7)***
Net sales$507.2 $698.3 (27.4)%0.1 %(27.5)%
*Not meaningful



4

MALLINCKRODT PLC
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in millions, except per share data)
Nine Months Ended
September 24,
2021		Percent of
Net sales		September 25,
2020		Percent of
Net sales
Net sales (includes refined estimate of the retrospective one-time charge of $535.1 million related to the Medicaid lawsuit for the nine months ended September 25, 2020)
$1,611.6 100.0 %$1,530.6 100.0 %
Cost of sales958.4 59.5 1,171.7 76.6 
Gross profit653.2 40.5 358.9 23.4 
Selling, general and administrative expenses408.3 25.3 683.2 44.6 
Research and development expenses166.3 10.3 225.8 14.8 
Restructuring charges, net17.5 1.1 15.8 1.0 
Non-restructuring impairment charges64.5 4.0 63.5 4.1 
Losses (gains) on divestiture0.8 — (10.1)(0.7)
Opioid-related litigation settlement loss (gain)125.0 7.8 (34.1)(2.2)
Medicaid lawsuit— — 105.1 6.9 
Operating loss(129.2)(8.0)(690.3)(45.1)
Interest expense(160.7)(10.0)(200.9)(13.1)
Interest income1.9 0.1 5.4 0.4 
Other income, net15.9 1.0 1.1 0.1 
Reorganization items, net(329.2)(20.4)— — 
Loss from continuing operations before income taxes
(601.3)(37.3)(884.7)(57.8)
Income tax benefit(81.9)(5.1)(69.2)(4.5)
Loss from continuing operations(519.4)(32.2)(815.5)(53.3)
Income from discontinued operations, net of income taxes
6.0 0.4 23.8 1.6 
Net loss$(513.4)(31.9)%$(791.7)(51.7)%
Basic loss per share:
Loss from continuing operations$(6.13)$(9.66)
Income from discontinued operations0.07 0.28 
Net loss$(6.06)$(9.38)
Diluted loss per share:
Loss from continuing operations$(6.13)$(9.66)
Income from discontinued operations0.07 0.28 
Net loss$(6.06)$(9.38)
Weighted-average number of shares outstanding:
Basic84.784.4
Diluted84.784.4
5

MALLINCKRODT PLC
(DEBTOR-IN-POSSESSION)
CONSOLIDATED ADJUSTED EBITDA
(unaudited, in millions)
Nine Months Ended
September 24, 2021September 25, 2020
Gross ProfitSG&AR&DAdjusted EBITDAGross ProfitSG&AR&DAdjusted EBITDA
Net loss$653.2 $408.3 $166.3 $(513.4)$358.9 $683.2 $225.8 $(791.7)
Adjustments:
Interest expense, net— — — 158.8 — — — 195.5 
Income tax benefit— — — (81.9)— — — (69.2)
Depreciation (1)
52.2 (13.4)(4.7)70.3 54.2 (16.3)(5.2)75.7 
Amortization433.3 (2.5)— 435.8 597.2 (2.6)— 599.8 
Restructuring charges, net— — — 17.5 — — — 15.8 
Non-restructuring impairment charges— — — 64.5 — — — 63.5 
Income from discontinued operations— — — (6.0)— — — (23.8)
Change in contingent consideration fair value— 7.6 — (7.6)— (2.4)— 2.4 
Significant legal and environmental charges— — — 125.0 535.1 (53.1)— 659.2 
Losses (gains) on divestiture— — — 0.8 — — — (10.1)
Separation costs— (1.0)— 1.0 — (75.0)— 75.0 
Unrealized gain on equity investment— — — (4.8)— — — (2.2)
R&D upfront payment— — — — — — (5.0)5.0 
Reorganization items, net— — — 329.2 — — — — 
Share-based compensation 0.4 (6.6)(1.4)8.4 0.8 (14.0)(2.8)17.6 
As adjusted:$1,139.1 $392.4 $160.2 $597.6 $1,546.2 $519.8 $212.8 $812.5 
(1)Includes $2.0 million of accelerated depreciation in SG&A related to restructuring charges incurred during the nine months ended September 24, 2021.

6

MALLINCKRODT PLC
(DEBTOR-IN-POSSESSION)
SEGMENT OPERATING INCOME
(unaudited, in millions)
Nine Months Ended
September 24,
2021		September 25,
2020
Specialty Brands$588.6 $765.0 
Specialty Generics73.8 155.5 
Segment operating income662.4 920.5 
Unallocated amounts:
Corporate and unallocated expenses (1)
(69.1)(152.3)
Depreciation and amortization(506.1)(675.5)
Share-based compensation(8.4)(17.6)
Restructuring charges, net(17.5)(15.8)
Non-restructuring impairment charges(64.5)(63.5)
Separation costs(1.0)(75.0)
R&D upfront payment— (5.0)
Opioid-related litigation settlement (loss) gain(125.0)34.1 
Medicaid lawsuit— (640.2)
Operating loss$(129.2)$(690.3)
(1)Includes administration expenses and certain compensation, legal, environmental and other costs not charged to the Company's reportable segments.


7


MALLINCKRODT PLC
(DEBTOR-IN-POSSESSION)
SEGMENT NET SALES AND CONSTANT-CURRENCY GROWTH
(unaudited, in millions)
Nine Months Ended
September 24,
2021		September 25,
2020		Percent
change		Currency impactConstant-currency growth
Specialty Brands$1,149.6 $1,553.0 (26.0)%0.3 %(26.3)%
Specialty Generics462.0 512.7 (9.9)0.1 (10.0)
Segment net sales1,611.6 2,065.7 (22.0)0.2 (22.2)
Medicaid lawsuit— (535.1)***
Net sales$1,611.6 $1,530.6 5.3 %0.2 %5.1 %
*Not meaningful

MALLINCKRODT PLC
(DEBTOR-IN-POSSESSION)
SELECT PRODUCT LINE NET SALES
(unaudited, in millions)
Nine Months Ended
September 24,
2021		September 25,
2020		Percent
change		Currency impactConstant-currency growth
Specialty Brands
Acthar$423.9 $576.6 (26.5)%— %(26.5)%
Inomax338.3 438.5 (22.9)0.1 (23.0)
Ofirmev24.0 216.0 (88.9)— (88.9)
Therakos197.8 174.1 13.6 2.1 11.5 
Amitiza155.8 138.2 12.7 — 12.7 
Other9.8 9.6 2.1 — 2.1 
Specialty Brands Total1,149.6 1,553.0 (26.0)0.3 (26.3)
Specialty Generics
Hydrocodone (API) and hydrocodone-containing tablets60.7 71.9 (15.6)— (15.6)
Oxycodone (API) and oxycodone-containing tablets49.5 48.0 3.1 — 3.1 
Acetaminophen (API)146.8 154.5 (5.0)— (5.0)
Other controlled substances187.9 223.8 (16.0)0.3 (16.3)
Other17.1 14.5 17.9 — 17.9 
Specialty Generics Total462.0 512.7 (9.9)0.1 (10.0)
Segment net sales1,611.6 2,065.7 (22.0)0.2 (22.2)
Medicaid lawsuit— (535.1)***
Net sales$1,611.6 $1,530.6 5.3 %0.2 %5.1 %
*Not meaningful



8

MALLINCKRODT PLC
(DEBTOR-IN-POSSESSION)
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in millions)
September 24,
2021		December 25,
2020
Assets
Current Assets:
Cash and cash equivalents$1,322.6 $1,070.6 
Accounts receivable, net431.7 538.8 
Inventories367.6 344.9 
Prepaid expenses and other current assets203.7 350.0 
Total current assets2,325.6 2,304.3 
Property, plant and equipment, net767.7 833.1 
Intangible assets, net5,684.1 6,184.5 
Other assets380.6 393.5 
Total Assets$9,158.0 $9,715.4 
Liabilities and Shareholders' Equity
Current Liabilities:
Current maturities of long-term debt$1,388.1 $3,587.9 
Accounts payable122.2 93.3 
Accrued payroll and payroll-related costs62.7 79.4 
Accrued interest25.7 26.9 
Accrued and other current liabilities387.1 331.2 
Total current liabilities1,985.8 4,118.7 
Pension and postretirement benefits32.6 34.6 
Environmental liabilities60.3 59.8 
Deferred income taxes61.5 80.6 
Other income tax liabilities82.9 100.1 
Other liabilities86.0 109.8 
Liabilities subject to compromise6,335.5 4,192.6 
Total Liabilities8,644.6 8,696.2 
Shareholders' Equity:
Preferred shares— — 
Ordinary shares
18.9 18.8 
Ordinary shares held in treasury at cost(1,616.1)(1,616.1)
Additional paid-in capital5,596.0 5,587.6 
Retained deficit(3,474.9)(2,961.5)
Accumulated other comprehensive loss(10.5)(9.6)
Total Shareholders' Equity513.4 1,019.2 
Total Liabilities and Shareholders' Equity$9,158.0 $9,715.4 


9

MALLINCKRODT PLC
(DEBTOR-IN-POSSESSION)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in millions)
Nine Months Ended
September 24,
2021		September 25,
2020
Cash Flows From Operating Activities:
Net loss$(513.4)$(791.7)
Adjustments to reconcile net cash from operating activities:
Depreciation and amortization506.1 675.5 
Share-based compensation8.4 17.6 
Deferred income taxes(19.1)304.0 
Non-cash impairment charges64.5 63.5 
Losses (gains) on divestiture0.8 (10.1)
Reorganization items, net22.5 — 
Other non-cash items(6.0)(21.6)
Changes in assets and liabilities:
Accounts receivable, net105.7 61.1 
Inventories(30.9)(43.9)
Accounts payable14.7 (52.4)
Income taxes92.5 (431.2)
Opioid-related litigation settlement liability125.0 — 
Medicaid lawsuit(4.8)640.2 
Other40.4 (116.3)
Net cash from operating activities406.4 294.7 
Cash Flows From Investing Activities:
Capital expenditures(39.2)(42.4)
Proceeds from divestitures, net of cash15.7 (0.7)
Other1.4 6.7 
Net cash from investing activities(22.1)(36.4)
Cash Flows From Financing Activities:
Repayment of external debt(128.2)(134.6)
Debt financing costs— (9.3)
Repurchase of shares— (0.4)
Other— (36.3)
Net cash from financing activities(128.2)(180.6)
Effect of currency rate changes on cash(0.9)0.2 
Net change in cash, cash equivalents and restricted cash255.2 77.9 
Cash, cash equivalents and restricted cash at beginning of period1,127.0 822.6 
Cash, cash equivalents and restricted cash at end of period$1,382.2 $900.5 
Cash and cash equivalents at end of period$1,322.6 $844.2 
Restricted cash included in prepaid expenses and other assets at end of period23.3 20.2 
Restricted cash included in other long-term assets at end of period36.3 36.1 
Cash, cash equivalents and restricted cash at end of period$1,382.2 $900.5 
10