Amneal Pharmaceuticals, Inc. · NASDAQ:AMRX

Amneal Pharmaceuticals — Q2 2019 Earnings Presentation

31 slides from Amneal Pharmaceuticals's earnings presentation, Aug 5, 2019

  1. Slide 1: Leadership Transition & Strategic Priorities and Q2 2019 Financial Results

    “ We make healthy possible” Leadership Transition & Strategic Priorities and Q2 2019 Financial Results Earnings Call 1 August 5, 2019

  2. Slide 2: Safe Harbor Statement

    Safe Harbor Statement Safe Harbor Statement Certain statements contained herein, regarding matters that are not historical facts, may be forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995). Such forward- looking statements include statements regarding mana

  3. Slide 3: Non-GAAP Financial Measures

    Non-GAAP Financial Measures This presentation includes certain Non-GAAP financial measures, including adjusted EBITDA, adjusted net income, adjusted net income per diluted share, adjusted gross profit, adjusted gross margin, adjusted operating income, which are intended as supplemental measures of t

  4. Slide 4: Agenda

    Agenda 1 Strategic Priorities Chirag Patel and Chintu Patel, Co-CEOs 2 Q2 Financial Results & Guidance Todd Branning, SVP & CFO 3 Closing Remarks Chirag Patel 4 Q&A 4

  5. Slide 5: Strategic Priorities

    Strategic Priorities Chirag and Chintu Patel Co-CEOs 5

  6. Slide 6: Building on Strong Foundation

    Building on Strong Foundation Founded Amneal in 2002 with the goal of providing affordable medicine to patients • Transformed Company to vertically integrated, multi-billion dollar generic pharmaceutical company with global operations • Built one of the largest and most diversified ANDA pipelines in

  7. Slide 7: Vision for the Future

    Vision for the Future High-Level Near-Term Goals; Update on Q3 2019 Earnings Call Revitalize Generics Reinvigorate Organic Accelerate Inorganic Platform Growth Growth Enhance Operations to Continue investing in complex Generics Further diversify business through Position Amneal for Growth and Specia

  8. Slide 8: Superb Track Record of Bringing Products to Market

    Superb Track Record of Bringing Products to Market What We’ve Done: What’s Next: 1 Excellence in Complex Generics and Growing Pipeline Execution and Focus on Specialty 1 Generics Specialty Franchise Injectables Transdermal Topical/Ring Oral Solids Liquid/Nasal Ophthalmic Biosimilars1 2 2 3 & Special

  9. Slide 9: Long-Term Growth Drivers

    Long-Term Growth Drivers Complex Generics & Biosimilars Specialty • Expect to launch ~15 complex generic products over • Augment Specialty with both internally developed the next 24 months and in-licensed products • Continue to find biosimilar development partners to • Leverage commercial infrastruc

  10. Slide 10: Financial Review

    Financial Review Todd Branning SVP & CFO 10

  11. Slide 11: Q2 2019 Results

    Q2 2019 Results Combined Adjusted(1) Variance Revenue and Gross Margin decline due to: • Greater than expected effects of additional competition on key Q2 Q2 Q1 generic products after prolonged periods of limited competition YOY Sequential $ millions 2019 2018 2019 • Ongoing pressure on base generic

  12. Slide 12: Generics Segment

    Generics Segment Combined Adjusted Results(1) $ millions Net Revenue Gross Margin Operating Income $383 $382 $335 $109 48% $97 42% 34% $65 Q2 18 Q1 19 Q2 19 Q2 18 Q1 19 Q2 19 Q2 18 Q1 19 Q2 19  YOY decrease: additional competition on key  YOY and sequential decreases: impact of  Year-over-year an

  13. Slide 13: Specialty Segment

    Specialty Segment Combined Adjusted Results(1) $ millions Net Revenue Gross Margin Operating Income $80 79% 83% 82% $38 $39 $70 $64 $29 Q2 18 Q1 19 Q2 19 Q2 18 Q1 19 Q2 19 Q2 18 Q1 19 Q2 19  Year-over-year decrease: lower sales of Albenza®  Year-over-year (increase) and sequential (slight  Year-o

  14. Slide 14: Cash Flow and Balance Sheet Information

    Cash Flow and Balance Sheet Information $ millions $ millions Q2 2019 Q1 2019 Change Cash and cash equivalents(5) $57 $67 ($10) $407 Accounts receivable $640 ($5) $361 $635 Current portion and long-term debt(1) $2,641 $2,647 ($6) Cash flow from operations $21 ($108) --- $38 $50 $67 $12 Gross Debt to

  15. Slide 15: Revised 2019 Financial Guidance

    Revised 2019 Financial Guidance(1) Prior Updated Adjusted Gross Margin 47% - 50% No change Adjusted R&D as a % of net revenues 9% - 10% 9.5% - 10.5% Adjusted SG&A as a % of net revenues 11% - 12% 14% - 15% Adjusted EBITDA $600 million - $650 million $425 million - $475 million(2) Adjusted Diluted EP

  16. Slide 16: Closing Remarks

    Closing Remarks Chirag Patel Co-CEO 16

  17. Slide 17: Q&A

    Q&A

  18. Slide 18: Appendix: Non-GAAP Reconciliations

    Appendix: Non-GAAP Reconciliations 18

  19. Slide 19: Reconciliation of Non-GAAP Combined Revenue

    Reconciliation of Non-GAAP Combined Revenue (Unaudited: In thousands) Three months ended June 30, 2019 Three months ended June 30, 2018 Three months ended March 31, 2019 (Non- (Non- (Non- Add: GAAP) Add: GAAP) Add: GAAP) Impax/ Impax/ Impax/ Actual Gemini Combined Actual Gemini Combined Actual Gemin

  20. Slide 20: Net (Loss) Income to EBITDA and Combined Adjusted EBITDA

    Reconciliation of Net (Loss) Income to EBITDA and Combined Adjusted EBITDA (Unaudited: In thousands) Three months ended June 30, 2019 Three months ended June 30, 2018 (Non- (Non- Three months ended March 31, 2019 GAAP) GAAP) (Non-GAAP) Add: Add: Add: Impax/ Impax/ Impax/ Actual Gemini Combined Actua

  21. Slide 21: Net (Loss) Income to EBITDA and Combined Adjusted EBITDA

    Reconciliation of Net (Loss) Income to EBITDA and Combined Adjusted EBITDA (Unaudited: In thousands) Three months ended December 31, 2018 (Non-GAAP) Add: Three months ended Sept. 30, 2018 Impax/ Add: Actual Gemini Combined Impax/ Net (loss) $ (20,330) $ — $ (20,330) Actual Gemini Combined Adjusted t

  22. Slide 22: Gross Debt and Net Debt to Combined Adjusted EBITDA

    Gross Debt and Net Debt to Combined Adjusted EBITDA ($ in thousands) LTM LTM June 30, 2019 March 31, 2019 Current portion of long-term debt, net $ 21,445 $ 21,445 Long-term Debt , net 2,619,788 2,625,152 Cash and cash equivalents 54,893 63,946 Net debt 2,586,340 2,582,651 Combined Adjusted EBITDA Q2

  23. Slide 23: Net (Loss) Income to Combined Adjusted Net Income and Adjusted Diluted EPS

    Reconciliation of Net (Loss) Income to Combined Adjusted Net Income and Calculation of Adjusted Diluted EPS (Unaudited; In thousands, except per share amounts) Three months ended June 30, 2019 Three months ended June 30, 2018 Three months ended March 31, 2019 (Non-GAAP) (Non-GAAP) (Non-GAAP) Add: Ad

  24. Slide 24: Generics Operating Income to Generics Combined Operating Income

    Reconciliation of Generics Operating Income to Generics Combined Operating Income (Unaudited; In thousands) Three months ended March 31, 2019 Three months ended June 30, 2019 Three months ended June 30, 2018 (Non- (Non- (Non- Add: GAAP) Add: GAAP) Add: GAAP) Impax/ Impax/ Impax/ Actual Gemini Combin

  25. Slide 25: Generics Cost of Goods Sold to Combined Adjusted Cost of Goods Sold

    Reconciliation of Generics Cost of Goods Sold to Generics Combined Adjusted Cost of Goods Sold (Unaudited; In thousands) Three months ended June 30, 2019 Three months ended June 30, 2018 (Non- (Non- GAAP) GAAP) Three months ended March 31, 2019 Add: Add: (Non-GAAP) Impax/ Impax/ Add: Actual Gemini C

  26. Slide 26: Generics Operating (Loss) Income to Combined Adjusted Operating Income

    Reconciliation of Generics Operating (Loss) Income to Generics Combined Adjusted Operating Income (Unaudited; In thousands) Three months ended March 31, 2019 Three months ended June 30, 2019 Three months ended June 30, 2018 (Non-GAAP) (Non- (Non- Add: GAAP) GAAP) Impax/ Add: Add: Actual Gemini Combi

  27. Slide 27: Specialty Operating Income to Specialty Combined Operating Income

    Reconciliation of Specialty Operating Income to Specialty Combined Operating Income (Unaudited; In thousands) Three months ended March 31, 2019 Three months ended June 30, 2019 Three months ended June 30, 2018 (Non-GAAP) (Non-GAAP) (Non-GAAP) Add: Add: Add: Impax/ Impax/ Impax/ Actual Gemini Combine

  28. Slide 28: Specialty Cost of Goods Sold to Combined Adjusted Cost of Goods Sold

    Reconciliation of Specialty Cost of Goods Sold to Specialty Combined Adjusted Cost of Goods Sold (Unaudited; In thousands) Three months ended June 30, 2019 Three months ended June 30, 2018 (Non- (Non- GAAP) GAAP) Add: Add: Impax/ Impax/ Actual Gemini Combined Actual Gemini Combined Cost of goods sol

  29. Slide 29: Specialty Operating (Loss) Income to Combined Adjusted Operating Income

    Reconciliation of Specialty Operating (Loss) Income to Specialty Combined Adjusted Operating Income (Unaudited; In thousands) Three months ended June 30, 2019 Three months ended June 30, 2018 (Non-GAAP) (Non-GAAP) Add: Add: Actual Impax/ Gemini Combined Actual Impax/ Gemini Combined Operating income

  30. Slide 30: SG&A to Combined Adjusted SG&A

    Reconciliation of SG&A to Combined Adjusted SG&A (Unaudited; In thousands) Three months ended June 30, 2019 Three months ended June 30, 2018 (Non- (Non-GAAP) GAAP) Add: Add: Impax/ Impax/ Actual Gemini Combined Actual Gemini Combined Selling, general and administrative $ 67,281 $ — $ 67,281 $ 56,003

  31. Slide 31: Research and Development to Combined Adjusted Research and Development

    Reconciliation of Research and Development to Combined Adjusted Research and Development (Unaudited; In thousands) Three months ended June 30, 2019 Three months ended June 30, 2018 (Non- (Non- GAAP) GAAP) Add: Add: Impax/ Impax/ Actual Gemini Combined Actual Gemini Combined Research and development

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