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Q2 2015 RESULTS

Strong Operating Results And Execution on Plans For LongTerm Sustainable Growth

ALLERGAN CAUTIONARY STATEMENT REGARDING


FORWARD-LOOKING STATEMENTS
Statements contained in this communication that refer to Allergans estimated or anticipated future results, including estimated synergies, or other non-historical facts are forward-looking
statements that reflect Allergans current perspective of existing trends and information as of the date of this communication. Forward looking statements generally will be accompanied by
words such as anticipate, believe, plan, could, should, estimate, expect, forecast, outlook, targets, guidance, intend, may, might, will, possible, potential, predict,
project, or other similar words, phrases or expressions. Such forward-looking statements include, but are not limited to, statements about the benefits of the (legacy) Allergan acquisition,
including future financial and operating results, Allergans plans, objectives, and expectations. It is important to note that Allergans goals and expectations are not predictions of actual
performance. Actual results may differ materially from Allergans current expectations depending upon a number of factors affecting Allergans business. These factors include, among others,
the inherent uncertainty associated with financial projections; restructuring in connection with, the Allergan acquisition; subsequent integration of the Allergan acquisition and the ability to
recognize the anticipated synergies and benefits of the Allergan acquisition; the anticipated size of the markets and continued demand for legacy Actavis and legacy Allergans products;
Allergans ability to successfully develop and commercialize new products; Allergans ability to conform to regulatory standards and receive requisite regulatory approvals; availability of raw
materials and other key ingredients; uncertainty and costs of legal actions and government investigations; the inherent uncertainty associated with financial projections; fluctuations in
Allergans operating results and financial condition, particularly given our manufacturing and sales of branded and generic products; risks associated with acquisitions, mergers and joint
ventures, such as difficulties integrating businesses, uncertainty associated with financial projections, projected synergies, restructuring, increased costs, and adverse tax consequences; the
adverse impact of substantial debt and other financial obligations on the ability to fulfill and/or refinance debt obligations; risks associated with relationships with employees, vendors or key
customers as a result of acquisitions of businesses, technologies or products; our compliance with federal and state healthcare laws, including laws related to fraud, abuse, privacy security
and others; risks of the generic industry generally; generic product competition with our branded products; uncertainty associated with the development of commercially successful branded
pharmaceutical products; uncertainty associated with development and approval of commercially successful biosimilar products; costs and efforts to defend or enforce technology rights,
patents or other intellectual property; expiration of legacy Actavis and legacy Allergans patents on our branded products and the potential for increased competition from generic
manufacturers; risks associated with owning the branded and generic version of a product; competition between branded and generic products; the ability of branded product manufacturers
to limit the production, marketing and use of generic products; Allergans ability to obtain and afford third-party licenses and proprietary technology we need; Allergans potential infringement
of others proprietary rights; our dependency on third-party service providers and third-party manufacturers and suppliers that in some cases may be the only source of finished products or
raw materials that we need; Allergans competition with certain of our significant customers; the impact of our returns, allowance and chargeback policies on our future revenue; successful
compliance with governmental regulations applicable to Allergans and Allergans respective third party providers facilities, products and/or businesses; the difficulty of predicting the timing or
outcome of product development efforts and regulatory agency approvals or actions, if any; Allergans vulnerability to and ability to defend against product liability claims and obtain sufficient
or any product liability insurance; Allergans ability to retain qualified employees and key personnel; the effect of intangible assets and resulting impairment testing and impairment charges on
our financial condition; Allergans ability to obtain additional debt or raise additional equity on terms that are favorable to Allergan; difficulties or delays in manufacturing; our ability to manage
environmental liabilities; global economic conditions; Allergans ability to continue foreign operations in countries that have deteriorating political or diplomatic relationships with the United
States; Allergans ability to continue to maintain global operations; risks associated with tax liabilities, or changes in U.S. federal or international tax laws to which we are subject, including
the risk that the Internal Revenue Service disagrees that Allergan is a foreign corporation for U.S. federal tax purposes; risks of fluctuations in foreign currency exchange rates; risks
associated with cyber-security and vulnerability of our information and employee, customer and business information that Allergan stores digitally; Allergans ability to maintain internal control
over financial reporting; changes in the laws and regulations, affecting among other things, availability, pricing and reimbursement of pharmaceutical products; the highly competitive nature
of the pharmaceutical industry; Allergans ability to successfully navigate consolidation of our distribution network and concentration of our customer base; the difficulty of predicting the timing
or outcome of pending or future litigation or government investigations; developments regarding products once they have reached the market and such other risks and uncertainties detailed
in Allergans periodic public filings with the Securities and Exchange Commission, including but not limited to Allergans Quarterly Report on Form 10-Q for the quarter ended March 31, 2015
(such periodic public filings having been filed under the Actavis plc name) and from time to time in Allergans other investor communications. Except as expressly required by law, Allergan
disclaims any intent or obligation to update or revise these forward-looking statements.

AGENDA

Q2 2015 Highlights

Brent Saunders,
CEO & President

R&D Update
David Nicholson,
EVP & President Global
Brands R&D

5
3

Q&A

Q2 2015 Financial Results


Tessa Hilado,
CFO

Next Steps
Brent Saunders,
CEO & President

Q2 2015 HIGHLIGHTS
Brent
Saunders

Q2 Continued Execution on Four Pillars For LongTerm Growth


Operational excellence

Exceptional 2Q results driven by strong revenue growth 117%1, EPS growth of


29%1 and cash from operations of $1.72 billion supported by continued and
flawless integration

Leadership in key therapeutic categories

Strong global franchises with majority of key products growing at double-digit


rates

Productive organic R&D focused on innovation

> 100 approvals and 56 submissions worldwide3

Strategic business development to support growth strategy

Recent additions to our pipeline include Kythera; Naurex; Merck CGRP; Oculeve
Announced divestiture of Gx business reloads capital structure and transforms
Allergan

Non-GAAP Q2 2015 vs Q2 2014


acquisition related restructuring and integration payments
3 Branded products and devices
2 Excluding

Allergan Takes Bold Action


Divestiture of Global Gx Business Reloads Capital Structure & Accelerates
Transformation
> Teva will acquire Allergans global generic pharmaceuticals business for
$40.5B of cash and stock
$33.75B in cash and $6.75B1 (~100.3 m shares) in Teva stock
After tax net cash/equity proceeds of ~$36B
> Branded business focused on 7 therapeutic areas with strong mid-to-late
stage development pipeline
> Double-digit branded pharma revenue growth2
> Allergan reloads capital structure and accelerates transformation to Branded
Growth Pharma leader
> Significant reduction in operational complexity (40 plants to 12 plants)
> Expect to close in Q1 2016
1
2

$67.3/share based on the 20 day volume weighted average price (VWAP) and will be subject to a 12-month lock up
Excludes divestitures, Namenda IR and Anda distribution business

Q2: Strong Performance Continues In 2015


$5.7 Billion Non-GAAP Net
Revenue
12% Pro Forma vs Q2 14
117% vs Q2 14
36% vs Q1 15

$4.41 Non-GAAP EPS

$2.6 Billion Adjusted EBITDA

$1.4 Billion Cash Flow


from Operations

203% vs Q2 14
47% vs Q1 15

29% vs Q2 14
3% vs Q1 15

~ $1.7 Billion excluding acquisition


related restructuring and
integration payments

Q2 Results Demonstrate our Focus on Operational Excellence

Q2: Strong Performance in Global Generics


Global Generics Segment Performance

Strong Q2 performance -- 17% revenue growth vs. prior year excluding


Fx and 10% growth at actual rates, while integration-related activities
continue
US
Strong performance continues.
30+ new product launches YTD
Expanding pipeline: 12 new First-tofiles (FTF) confirmed YTD
Strong contribution from broad range
of high-barrier and semi-exclusive
products

International
International growth driven by key
markets (excluding Fx) :
UK strong growth (85% vs Q214).
including Auden Mckenzie which
closed in the quarter
Russia (32% growth in rev vs Q214).
Continue with share gains in a
challenging environment

Q2 : Global Brands Experiencing Strong Growth


Growth powered by strong sales force execution and
high impact DTC campaign Launched into PCP
audience in July 2015
Continued strong growth in both therapeutic and
cosmetics, ~15% excluding foreign exchange

Consistent growth in conversion throughout quarter


with more than half of franchise now XR; DTC
generated 40% lift in new to brand volume
Experienced double digit growth during Q2 fueled by
new DTC campaign and conversion of OTC users
Continues to achieve record level script volume
and reached new mkt share high, retaining its
position as #1 prescribed branded oral
contraception
Powered by international success (Vycross)
and product line extensions

# 1 branded Combination agent and fastest


growing Allergan Glaucoma brand
9

Top Global Products Net Revenues ($ M - Proforma)

Product

Q2 FY15

Q2 FY14

(actual
rates)

(excluding
Fx)

Total Brands

3,712.0

3,615.5

3%

6%

Total Brands (excluding


3,474.3
Namenda IR, divestitures)

3,231.9

7%

11%

Botox

631.5

579.4

9%

Restasis

325.0

269.3

21%

Namenda IR

232.6

312.5

-26%

Namenda XR

204.7

133.4

53%

Fillers

195.9

178.0

10%

Lumigan/Ganfort

176.5

174.7

1%

Asacol/Delzicol

149.3

148.9

0%

Bystolic

157.1

136.3

15%

Alphagan/Combigan

135.5

125.4

8%

Linzess/Constella

112.1

62.5

79%

Viibryd/Fetzima

80.7

64.8

25%

Lo Loestrin

79.2

68.0

16%

Silicon implants

71.8

81.9

-12%

Estrace Cream

70.1

57.9

21%

Aczone

60.3

45.0

34%

Other Branded

1,029.7

1,177.6

-13%

NAMENDA XR & NAMZARIC


FOCUS ON FRANCHISE EXPANSION
2015 and Beyond

Currently 53% of new patients


Drive conversion with XR & Namzaric

2016 Opportunity - Namzaric

Projected widespread formulary coverage


Top Part D Plans

Achieve ~65% conversion


Maintain full promotional effort
80%+ formulary coverage

NP*

65%
60%
55%

80% Preferred

53%

50%

* Non-Preferred

45%

40%
35%

Significant market expansion opportunity


$2 Billion Market for Combination Therapy

30%
25%

Aricept + IR

Namzaric full launch planned for Q3

10

Full sales force launch July 17


DTC campaign on track for September
Formulary coverage building rapidly
- Currently 4 out of 10 top Med D plans
- Anticipate 8 out of 10 by Jan 2016

2.2MM Rx
Annually

6.8MM Rx
Annually

Aricept
Monotherapy

Recent Transactions Complement Strategy to Lead in


Therapeutics Categories

$2.1 B

Kybella FDA
approved and
launched for
double chin

Seeking
International
approval
R&D: Male
Pattern Baldness

11

$125 M +
milestones

OD-01 Intranasal
neurostimulatory
Device for dry eye

Potential US
commercial
launch in 2017

Global CGRP
program
for $250 M +
milestones &
royalties
MK-1602 acute
treatment of
migraine
MK-8031
prevention of
migraine

$560 M +
milestones

Rapastinel
(GLYX-13) and
NRX-1074 for
depression

Research
collaboration

Q2 2015
FINANCIAL REVIEW

Tessa Hilado

12

Allergan Q2 2015 Financial Summary


Q2 2015

Q1 2015

Net Revenue

5,732

4,203

Growth
36%

2,635

Growth
117%

R&D expense

406

284

43%

185

120%

SG&A as a % of Revenue

21.7%

20.9%

0.8 ppts

18.7%

3.0 ppts

Adjusted EBITDA

2,613

1,782

47%

862

203%

Earnings Per Share

$4.41

$4.30

3%

$3.42

29%

Tax Rate

14.5%

14.3%

0.2 ppts

17.1%

(2.6 ppts)

Cash Flow From Operations

1,401

525

167%

470

198%

$ mi l l i ons , except per s ha re a mounts


(Non GAAP)*

Q2 2014

Overall strong performance year-over-year and sequentially due to Forest


and Allergan acquisitions.
Increase in Adjusted EBITDA driven by strong revenues and higher
operating margins.
Strong performance equates to strong cash from operations, $1.7B
excluding acquisition related, restructuring and integration payments.
* Please refer to the GAAP to non-GAAP reconciliation tables in the appendix for a reconciliation of our non-GAAP results.
13

Q2 2015 New Segment Reporting

US Brands

Sales and expenses related to


branded products within the US,
including Botox therapeutics.

International Brands
Sales and expenses from countries that have
the majority of their business represented by
branded sales.
Sales and expenses related to branded
product sales in Canada, Switzerland and
Austria.

US Medical

Sales and expenses related to


aesthetics and dermatology
products within the US, including
Botox cosmetics.

Global Generics
Sales and expenses from countries that have
the majority of their business represented by
generic sales, and our third-party Medis
business.
Sales and expenses related to generic sales
within US, Canada, Switzerland and Austria.

Anda

Distributes generic and brand pharmaceutical products manufactured by third parties,


as well as by the Company

As a result of Tevas acquisition of Allergans generic business, Q3 segment reporting will change with the
generics business reported as discontinued operations. The divested business spans global generics and
a portion of the international brands segments.
14

US Brands Performance Q2 2015


*

15

$ mi l l i ons - (Non GAAP)

Q2 2015

Q1 2015

Growth

Q2 2014 Growth

US Brands Revenues

2,436

1,798

35%

565

331%

Adjusted Gross Margins

87.4%

87.4%

0 ppts

87.40%

0 ppts

SG&A as a % of Revenue

20.8%

24.0%

(3.2 ppts)

17.8%

3.0 ppts

Segment Margin

66.6%

63.4%

3.2 ppts

69.6%

(3.0 ppts)

Strong revenue growth including acquisition of Allergan and Forest and strong
growth in key products including Linzess and Namenda XR versus prior
quarter.

Continued strong adjusted gross margins at 87.4%.

SG&A spend reflects early synergy capture from Allergan acquisition.

US Medical Aesthetics Performance Q2 2015

Q2 2015

Q1 2015

Growth

487

80

510%

Adjusted Gross Margin

93.0%

93.7%

(0.7 ppts)

SG&A as a % of Revenue

22.4%

20.6%

1.8 ppts

Segment Margin

70.6%

73.1%

(2.5 ppts)

$ mi l l i ons - (Non GAAP)

US Medical Aesthetics Revenue

16

Sequential comparisons impacted by partial contribution of


Allergan Medical in prior quarter.

Gross margin and segment margin in-line with expectations.

International Brands Performance Q2 2015


Q2 2015

Q1 2015

Growth

717

231

211%

169

324%

Adjusted Gross Margin

77.8%

63.2%

14.6 ppts

56.1%

21.7 ppts

SG&A as a % of Revenue

32.0%

39.2%

(7.2 ppts)

29.3%

2.7 ppts

Segment Margin

45.8%

24.0%

21.8 ppts

26.7%

19.1 ppts

$ mi l l i ons - (Non GAAP)

International Brands Revenue

17

Q2 2014 Growth

Sales growth versus prior periods driven by addition of Allergan products for the
full quarter.

Fillers experienced significant growth due to ongoing strong uptake of the


Vycross products as well as increasing consumer demand.

Gross Margin increased in Q2 2015 due to the inclusion of higher margin


products from Allergan.

Improvement in SG&A mainly due to executed synergies.

Global Generics Performance Q2 2015


Q2 2015

Q1 2015

Growth

Global Generics Revenue

1,629

1,632

0%

1,475

10%

Adjusted Gross Margin

58.2%

60.7%

(2.5 ppts)

57.2%

1.0 ppts

SG&A as a % of Revenue

15.0%

14.1%

0.9 ppts

15.8%

(0.8 ppts)

Segment Margin

43.2%

46.6%

(3.4 ppts)

41.4%

1.8 ppts

$ mi l l i ons - (Non GAAP)

18

Q2 2014 Growth

Revenue performance versus Q2 2014 impacted by strong sales in base


business including Gx Concerta , offset, in part, by additional competition on
certain products including Gx Lidoderm.

Lower gross margin versus Q1 2015 mainly due to lower contribution of


Guanfacine ER and Oxycodone HCL in Q2 2015 vs Q1 2015.

Anda Performance Q2 2015


$ mi l l i ons - (Non GAAP)

Anda Net Revenue


Gross Margin
SG&A as a % of Revenue
Segment Contribution
Segment Margin

19

Q2 2015

Q1 2015

Growth

462
12.5%
8.7%
17.7
3.8%

462
12.5%
8.8%
17.1
3.7%

0%
0 ppts
(0.1 ppts)
4%
0.1 ppts

Q2 2014 Growth
427
12.3%
8.4%
16.6
3.9%

8%
0.2 ppts
0.3 ppts
7%
(0.1 ppts)

Continued strong growth driven by base business trends and new retail chain
business.

Capitalization as of Q2 (Pro-forma)
$ millions, except per share amounts
Cash & Marketable Securities

Q2 2015
$1,526

ACT Term Loan

$2,413

WC Term Loan

$723

AGN Term Loan

$5,431

Other

$88

Leverage Ratio: Q2 2015 3.9x


Debt to pro forma adjusted
EBITDA vs. 4.1 in prior quarter

Committed to utilizing strong FCF


to accelerate debt repayment

$1.4B Debt pay down in Q2 15

Committed to investment grade


ratings

Senior Notes
- Floating Rate Notes

$1,500

- Fixed rate Notes

$32,550

- Premium / Discount

$153

Total Debt

$42,858

Equity

$72,075

Total Book Capitalization

$114,933

20

BRANDS R&D UPDATE

David
Nicholson

21

R&D Highlights
> 100 approvals and 56 submissions worldwide in YTD 2015
World Class R&D pipeline with 70+ projects in mid-late stages
14 NME approvals since 2009
Continual data driven prioritization process post integration

Approval of key pipeline assets in Q2 strengthens franchises and continues


building strong brands
Strabismus (Japan)
Adult Upper Limb Spasticity

Supplementing strong pipeline through business development


CGRP
antagonists

22

Late Stage Game-Changing Opportunities Exist in All


Therapeutic Areas
70+ Total Mid-to-Late Stage Programs*
27

# of projects mid-tolate stage of


development per
therapeutic area

Kybella**
Submential Fat

13
Sarecycline
Acne

Restasis
MDPF

Aczone

Dry Eye

Glyx 13**

Acne

DARPin

Depression

AMD/DME

Bimatoprost
Hair Growth

Bimatoprost

SR
Glaucoma

HA Fillers

Oculeve**
dry eye device

Aesthetics

Eye Care

10

CGRP**
Antagonist
Migraine

Cariprazine
Schitzophrenia/
Bipolar Mania

Namzaric
Alzheimers

CNS

6
4
3

Linzess
IBS-C

ABSSSI

Viberzi
IBS-D

Dalvance

BOTOX

Esmya
Uterine
Fibroids

Ser 120

Avycaz

Bevacizumab

Nocturia

UTI & IAI

NSCLC

Trastuzumab
Breast Cancer

GI

Women's
Health

* Also includes CV and internal medicines and excludes early stage pipeline and pending deals
23 ** Pending Approvals

Urology

AntiInfectives

Biologics

R&D Productivity Continues


Regulatory Updates by Therapeutic Area
Aesthetics
Botox

Eye Care

GI

Women Health

Urology

Anti-Infectives

Cariprazine

Linzess

Esmya

SER 120

Dalvance

Schizophrenia/
Bipolar Acute
Mania - PDUFA
Date 09/15

(CIC) Low Dose


(72 mcg) Top
line data Phase
III 2H15 (2016
submission)

Nocturia Phase
III top line data
under review

Single-infusion
administration
simplifying patient
treatment submitted
in US and EU

Natrelle Inspira Botox

Namzaric

Round gel-filled
textured breast
implants

Additional
fixed dose
submission in
2015

Eluxadoline
US approved as
a twice-daily,
oral treatment
for IBS-D.
Awaiting DEA
scheduling

For control
of bleeding
caused by
uterine fibroids.
Completing
recruitment
Phase III by
end 2015

Japanese NDA
submitted to
PMDA for crows
feet lines

Natrelle 410
X&L FDA
Approval

Juvederm

Restasis
MDPF

CNS

US Submission
September
2015

Approved in
Japan for
strabismus

Bimataprost
SR:
GlaucomaPhase III
recruiting US

China Approval

Fillers

DARPin

Volbella lips US
submission in
Q3 15

(AMD) Initiated
pivotal Phase III
trials

24

Submitted in EU

Teflaro
Bacteremia
PDUFA 2015

Continued Expansion of Industry-Leading R&D Pipeline


Continue to invest in long term durable, innovative assets through our recent
business development activities

Acquisition expands Facial


Aesthetics portfolio

Kybella first in class and only approved


non-surgical treatment for double chin

Acquisition adds to
existing Dry Eye pipeline

Novel intranasal neurostimulatory


device that increases tear production
in patients with dry eye disease

License from Merck adds


to CNS Migraine
development programs

First-in-class oral formulation of CGRP


antagonist in development for
treatment and prevention of migraine

Acquisition enhances our


pipeline in CNS depression

NMDA modulators novel mechanism


for treatment of depression

3
CGRPs

25

Next Steps
Brent
Saunders

26

Next Events/Financial Updates

Mid-to-Late
September 2015

November 4, 2015
In Irvine, CA

27

Forecast update on financial


performance of continuing
operations for second half 2015

Q3 Earnings
R&D key pipeline overview
Irvine campus tour and clinics

Most Dynamic Company in Branded Growth Pharma*

~$15.5B+
2015 Global Pro
Forma Revenue

~$1.4B
2015 pro forma
R&D spend

28

10+%
Branded Revenue
Growth Target

>70 mid-to-late
stage projects
Robust R&D pipeline

7
Therapeutic Areas

~$36B
Reloaded Capital Structure
(after-tax cash and equity)

>15,000
Committed Employees

* Excludes divestitures, Namenda IR and Anda distribution business. Reflects pro forma company following the recently
announced sale of Global Generics business to Teva.

12 Plants
Simplified Operating
Structure

Q2 2015 Reconciliation Tables

29

GAAP to Non-GAAP statement of operations for the three months ended June 30, 2015 and 2014
GAAP to Non-GAAP statement of operations for the six months ended June 30, 2015 and 2014
Product revenue for significant promoted products globally for the three and six months ended June
30, 2015 and 2014
Condensed Consolidated Balance Sheets as of June 30, 2015 and December 31, 2014
Condensed Consolidated Statements of Cash Flows for the three and six months ended June 30,
2015 and 2014
Reconciliation of reported net (loss) / income and diluted EPS to non-GAAP net income and diluted
EPS for the three and six months ended June 30, 2015 and June 30, 2014
Reconciliation of reported net (loss) / income for the three and six months ended June 30, 2015 and
2014 to adjusted EBITDA
Reconciliation of reported net revenues, cost of sales and SG&A for the three and six months ended
June 30, 2015 and 2014 to adjusted net revenues, adjusted cost of sales, adjusted gross profit,
adjusted gross margin as a percentage of adjusted net revenues, adjusted SG&A and adjusted SG&A
as a percentage of adjusted net revenues.
Reconciliation of expected GAAP Research & Development expense to adjusted Research &
Development expense for the three and six months ended June 30, 2015 and 2014
Allergan Business Segment Results

GAAP to Non-GAAP statement of operations for the three


months ended June 30, 2015 and 2014
ALLERGAN PLC
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS TO NON-GAAP STATEMENT OF OPERATIONS
(Unaudited; in millions, except per share amounts)
Three Months Ended
June 30, 2015
GAAP
Net revenues

5,755.0

Adjustments
$

Non-GAAP

(23.5) (1)

5,731.5

GAAP
$

Adjustments

2,667.2

Operating expenses:
Cost of sales (excludes amortization and impairment of acquired
intangibles including product rights)
Research and development
Selling, general and administrative
Amortization
In-process research and development impairments

2,130.1
454.9
1,461.2
1,673.5
197.6

(542.9)
(48.9)
(218.0)
(1,673.5)
(197.6)

(2)
(3)
(4)
(5)
(6)

1,587.2
406.0
1,243.2
-

1,296.5
158.0
561.6
422.9
16.3

Asset sales and impairments, net


Total operating expenses
Operating (loss) / income

0.6
5,917.9
(162.9)

(0.6) (6)
(2,681.5)
2,658.0

3,236.4
2,495.1

5.8
2,461.1
206.1

2.6
(359.3)
0.4
(356.3)
2,138.8
309.7
1,829.1
(1.5)
1,827.6
1,827.6

1.2
(79.1)
(35.8)
(113.7)
92.4
43.6
48.8
(0.1)
48.7
48.7

$
$

4.66
4.41

$
$

0.28
0.28

Non-operating income (expense):


Interest income
Interest expense
Other income (expense), net
Total other income (expense), net
(Loss) / income before income taxes and noncontrolling interest
(Benefit) / provision for income taxes
Net (loss) / income
(Income) attributable to noncontrolling interest
Net (loss) / income attributable to shareholders
Dividends on preferred shares
Net (loss) / income attributable to ordinary shareholders

2.6
(339.9)
(48.7)
(386.0)
(548.9)
(307.3)
(241.6)
(1.5)
(243.1)
69.6
(312.7)

(Loss) / earnings per share attributable to ordinary shareholders:


Basic
Diluted

$
$

(0.80)
(0.80)

Weighted average shares outstanding:


Basic
Diluted

30

Three Months Ended


June 30, 2014

392.6
392.6

(19.4)
49.1
29.7
2,687.7
617.0
2,070.7
2,070.7
(69.6)
2,140.3

(7)
(8)

(9)

(10)

392.6
414.4

174.2
175.0

Non-GAAP

(31.9) (1)

(145.4)
26.8
(68.2)
(422.9)
(16.3)

(11)
(12)
(13)
(5)
(14)
(5.8) (14)
(631.8)
599.9

(5.4)
34.5
29.1
629.0
79.5
549.5
549.5
549.5

2,635.3

1,151.1
184.8
493.4
1,829.3
806.0

1.2
(84.5)
(1.3)
(84.6)
721.4
123.1
598.3
(0.1)
598.2
598.2

$
$

3.43
3.42

(15)
(16)

(9)

(10)

174.2
175.0

GAAP to Non-GAAP statement of operations for the three


months ended June 30, 2015 and 2014 (cont.)
Footnotes to the statement
(1)
Net revenues Amounts included in the quarters ended June 30, 2015 and 2014 primarily represents the continuing results from Western European assets sold in the second quarter of 2014.
(2)

Cost of sales (excludes amortization and impairment of acquired intangibles including product rights) Amount in cost of sales in the quarter ended June 30, 2015 includes amortization of the Forest,
Allergan, Auden and Durata related inventory step ups of $493.2 million as the inventory acquired in each acquisition was sold to the Companys third party customers. Also included in cost of sales for
the quarter ended June 30, 2015 was severance and severance related costs incurred in connection with the Allergan acquisition of $6.8 million, the purchase accounting impact on stock-based
compensation associated with the Allergan and Forest acquisitions of $7.5 million, the impact of the Companys global supply chain excellence initiative of $8.2 million, expenses associated with the fair
market value adjustments and accretion of contingent consideration obligations of $4.4 million, and amounts recorded from the continuing results from Western European assets sold in Q2 14 of $23.0
million.

(3)

Research and development Research and development costs in the quarter ended June 30, 2015, primarily included severance and severance related costs incurred in connection with the Allergan
acquisition of $6.8 million, the purchase accounting impact on stock-based compensation associated with the Allergan and Forest acquisitions of $37.4 million, a reduction in contingent consideration
obligations, net of $(25.1) million and milestone payments associated with select R&D projects of $30.0 million.

(4)

Selling, general and administrative. Selling and marketing costs in the quarter ended June 30, 2015, primarily included severance and severance related costs incurred in connection with the Allergan
acquisition of $5.0 million, other integration costs related to the Allergan acquisition of $5.6 million and the purchase accounting impact on stock-based compensation associated with the Allergan and
Forest acquisitions of $39.5 million. General and administrative costs in the quarter ended June 30, 2015 primarily included integration and severance expenses associated with the Allergan and Forest
acquisitions of $78.1 million, the foreign exchange impact on contingent consideration obligations of $(7.0) million, the purchase accounting impact on stock-based compensation associated with the
Allergan and Forest acquisitions of $47.1 million and the reversal of mark-to-market unrealized (gains) / losses associated with foreign currency options exercisable in future periods of $37.7 million.

(5)
(6)

Amortization Includes amortization of acquired intangibles including product rights.


In-process research and development (IPR&D) impairments and asset sales and impairments, net IPR&D impairments in the quarter ended June 30, 2015 relate primarily to a reduction in cash flows for
womens healthcare portfolio products acquired in the Warner Chilcott acquisition.
Interest expense - Amount in interest expense includes the amortization of the fair value step up of senior secured notes assumed as part of the Forest and Allergan acquisitions.

(7)

31

(8)

Other income (expense), net Other income (expense), net for the quarter ended June 30, 2015 primarily relates to the impairment of royalty rights of $38.8 million due to a contract termination. Also
included in this amount is a loss resulting from the sale of the Companys Australian generics business to Amneal Pharmaceuticals of $13.6 million, offset, in part by miscellaneous gains.

(9)
(10)

Provision for income taxes - In addition to the income tax impact on the items above, the provision for income taxes included the impact of select discrete items.
Dividends on preferred shares - The dividend impact is excluded from dilutive EPS as the Company is assuming the "if-converted" method of preferred shares.

(11)

Cost of sales (excludes amortization and impairment of acquired intangibles including product rights) Amount in cost of sales in the quarter ended June 30, 2014 included amortization of the Warner
Chilcott and Silom related inventory step ups of $85.4 million as the inventory acquired in each acquisition was sold to the Companys third party customers. Also included in cost of sales for the quarter
ended June 30, 2014 was severance and severance related costs of $3.8 million, the impact of the Companys global supply chain excellence initiative of $11.0 million, expenses associated with the fair
market value adjustments and accretion of contingent consideration obligations of $7.2 million, and amounts recorded from the continuing results from Western European assets sold in Q2 14 of $38.3
million.

(12)

Research and development Amounts in research and development expenses in the quarter ended June 30, 2014 includes fair market value adjustments relating to contingent consideration liabilities
assumed as part of acquisition accounting, including accretion, which created income in the quarter of $28.2 million.

(13)

Selling, general and administrative Selling and marketing costs in the quarter ended June 30, 2014 primarily included contract termination fees relating to a former co-promotion agreement of $10.0 million.
General and administrative expenses in the quarter ended June 30, 2014 primarily included fees incurred for the then pending acquisition of Forest Laboratories of $34.5 million, integration costs in
connection with the acquisitions of legacy Actavis and Warner Chilcott of $7.8 million, the impact of our global supply chain initiative of $3.3 million and acquisition related fees for the Silom acquisition
of $3.5 million.

(14)

In-process research and development (IPR&D) impairments and asset sales and impairments, net IPR&D impairments in the quarter ended June 30, 2014 related primarily to the Estelle and Colvir
products acquired in the Uteron Pharma acquisition after an identified triggering event. Asset sales and impairments related to the net impairment of some of our legacy manufacturing plants as part of
the overall global supply chain initiatives.

(15)

Interest expense - Amount in interest expense includes the amortization of the fair value step up of senior secured notes assumed as part of the Warner Chilcott acquisition.

(16)

Other income (expense), net Other income (expense), net for the quarter ended June 30, 2014 includes the expensing of bridge loan commitment fees incurred in connection with the then pending Forest
acquisition of $13.5 million and the loss on the sale of the Western European assets divested of $20.9 million.

GAAP to Non-GAAP statement of operations for the six


months ended June 30, 2015 and 2014
ALLERGAN PLC
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS TO NON-GAAP STATEMENT OF OPERATIONS
(Unaudited; in millions, except per share amounts)
Six Months Ended
June 30, 2015
GAAP
Net revenues

Operating expenses:
Cost of sales (excludes amortization and impairment of acquired
intangibles including product rights)
Research and development
Selling, general and administrative
Amortization
In-process research and development impairments

3,843.5
885.9
2,889.7
2,598.9
197.6

Asset sales and impairments, net


Total operating expenses
Operating (loss) / income

58.4
10,474.0
(484.8)

Non-operating income (expense):


Interest income
Interest expense
Other income (expense), net
Total other income (expense), net
(Loss) / income before income taxes and noncontrolling interest
(Benefit) / provision for income taxes
Net (loss) / income
(Income) attributable to noncontrolling interest
Net (loss) / income attributable to shareholders
Dividends on preferred shares
Net (loss) / income attributable to ordinary shareholders

4.4
(511.8)
(246.7)
(754.1)
(1,238.9)
(485.0)
(753.9)
(1.2)
(755.1)
92.8
(847.9)

(Loss) / earnings per share attributable to ordinary shareholders:


Basic
Diluted

$
$

(2.48)
(2.48)

Weighted average shares outstanding:


Basic
Diluted

32

9,989.2

Adjustments

341.3
341.3

Non-GAAP

(55.0) (1) $

(892.8)
(195.9)
(768.9)
(2,598.9)
(197.6)

Six Months Ended


June 30, 2014

9,934.2

GAAP
$

Adjustments

5,322.3

(2)
(3)
(4)
(5)
(6)

2,950.7
690.0
2,120.8
-

2,589.5
329.5
1,120.5
847.1
16.3

(58.4) (6)
(4,712.5)
4,657.5

5,761.5
4,172.7

5.4
4,908.3
414.0

4.4
(543.0)
1.0
(537.6)
3,635.1
523.8
3,111.3
(1.2)
3,110.1
3,110.1

2.2
(151.9)
(30.8)
(180.5)
233.5
88.0
145.5
(0.3)
145.2
145.2

$
$

9.11
8.71

$
$

0.83
0.83

(31.2)
247.7
216.5
4,874.0
1,008.8
3,865.2
3,865.2
(92.8)
3,958.0

(7)
(8)

(9)

(10)

341.3
357.1

174.0
175.0

Non-GAAP

(144.0) (1) $

5,178.3

(360.6)
29.9
(139.3)
(847.1)
(16.3)

(11)
(12)
(13)
(5)
(14)

2,228.9
359.4
981.2
-

(5.4) (14)
(1,338.8)
1,194.8

3,569.5
1,608.8

(10.9)
34.6
23.7
1,218.5
154.6
1,063.9
1,063.9
1,063.9

2.2
(162.8)
3.8
(156.8)
1,452.0
242.6
1,209.4
(0.3)
1,209.1
1,209.1

$
$

6.95
6.91

(15)
(16)

(9)

(10)

174.0
175.0

GAAP to Non-GAAP statement of operations for the six


months ended June 30, 2015 and 2014 (cont.)
Footnotes to the statement
(1)
Net revenues Amounts included in the six months ended June 30, 2015 and 2014 primarily represents the continuing results from Western European assets sold in the second quarter of 2014.

33

(2)

Cost of sales (excludes amortization and impairment of acquired intangibles including product rights) Amount in cost of sales in the six months ended June 30, 2015 includes amortization of the
Forest, Allergan, Auden, Warner Chilcott and Durata related inventory step ups of $706.1 million as the inventory acquired in each acquisition was sold to the Companys third party customers.
Cost of sales in the six months ended June 30, 2015 includes the expensing of inventory, inclusive of the purchase accounting step up related to unsalable inventory resulting from the sale of the
Companys respiratory business to Astra Zeneca of $35.3 million. Also included in cost of sales for the six months ended June 30, 2015 was severance and severance related costs incurred in
connection with the Allergan acquisition of $21.3 million, the purchase accounting impact on stock-based compensation associated with the Allergan and Forest acquisitions of $14.9 million, the
impact of the Companys global supply chain excellence initiative of $26.0 million, expenses associated with the fair market value adjustments and accretion of contingent consideration
obligations of $32.4 million, and amounts recorded from the continuing results from Western European assets sold in Q2 14 of $55.7 million.

(3)

Research and development Research and development costs in the six months ended June 30, 2015, primarily included severance and severance related costs incurred in connection with the
Allergan acquisition of $67.4 million, the purchase accounting impact on stock-based compensation associated with the Allergan and Forest acquisitions of $103.7 million, a reduction in
contingent consideration obligations, net of $(24.6) million and milestone payments associated with select R&D projects of $40.0 million.

(4)

Selling, general and administrative. Selling and marketing costs in the six months ended June 30, 2015, primarily included severance and severance related costs incurred in connection with the
Allergan acquisition of $61.8 million and the Forest acquisition of $9.8 million, other integration costs related to the Allergan acquisition of $5.6 million and the purchase accounting impact on
stock-based compensation associated with the Allergan and Forest acquisitions of $75.7 million. General and administrative costs in the six months ended June 30, 2015 primarily included
integration and severance expenses associated with the Allergan and Forest acquisitions of $208.8 million, acquisition related costs of $78.4 million, the foreign exchange impact on contingent
consideration obligations of $8.0 million, , the purchase accounting impact on stock-based compensation associated with the Allergan and Forest acquisitions of $243.5 million and the reversal of
mark-to-market unrealized (gains) / losses associated with foreign currency options exercisable in future periods of $37.7 million.

(5)

Amortization Includes amortization of acquired intangibles including product rights.

(6)

In-process research and development (IPR&D) impairments and asset sales and impairments, net IPR&D impairments in the six months ended June 30, 2015 relate primarily to a reduction in
cash flows for womens healthcare portfolio products acquired in the Warner Chilcott acquisition. Asset sales and impairments, net, in the six months ended June 30, 2015, included a loss on the
impairment of our Australian generics business held for sale of $44.5 million and the movement in the fair value of other assets held for sale of $15.3 million, offset by miscellaneous gains.

(7)

Interest expense - Amount in interest expense includes the amortization of the fair value step up of senior secured notes assumed as part of the Forest and Allergan acquisitions.

(8)

(9)

Other income (expense), net Other income (expense), net for the six months ended June 30, 2015 includes the amortization of bridge loan commitment fees incurred in connection with the
Allergan acquisition of $264.9 million, a gain on an interest rate lock entered into in connection with the Allergan acquisition of $31.0 million and a loss on the sale of the respiratory business of
$5.3 million including the impairment of royalty rights. Also included in this amount is a loss resulting from the sale of the Companys Australian generics business to Amneal Pharmaceuticals of
$13.6 million, offset, in part by miscellaneous gains.
Provision for income taxes - In addition to the income tax impact on the items above, the provision for income taxes included the impact of select discrete items.

(10)

Dividends on preferred shares - The dividend impact is excluded from dilutive EPS as the Company is assuming the "if-converted" method of preferred shares.

(11)

Cost of sales (excludes amortization and impairment of acquired intangibles including product rights) Amount in cost of sales in the six months ended June 30, 2014 included amortization of the
Warner Chilcott and Silom related inventory step ups of $210.0 million as the inventory acquired in each acquisition was sold to the Companys third party customers. Also included in cost of
sales for the six months ended June 30, 2014 was integration and restructuring costs of $4.4 million, the impact of the Companys global supply chain excellence initiative of $22.4 million, expenses
associated with the fair market value adjustments and accretion of contingent consideration obligations of $7.5 million, and amounts recorded from the continuing results from Western European
assets sold in Q2 14 of $116.6 million.

(12)

Research and development Amounts in research and development expenses in the six months ended June 30, 2014 includes fair market value adjustments relating to contingent consideration
liabilities assumed as part of acquisition accounting, including accretion, which created income in the quarter of $35.4 million.

(13)

Selling, general and administrative Selling and marketing costs in the six months ended June 30, 2014 primarily included contract termination fees relating to a former co-promotion agreement of
$10.0 million and the continuing results from Western European assets sold in the second quarter of 2014 of $26.6 million. General and administrative expenses in the six months ended June 30,
2014 primarily included fees incurred for the then pending acquisition of Forest Laboratories of $48.6 million, restructuring charges associated with the Warner Chilcott acquisition, acquisition
related fees for the Silom acquisition of $3.5 million, cost associated with holding our Western European assets for sale of $5.7 million as well as continuing results from Western European assets
sold in the second quarter of 2014 of $6.9 million.

(14)

In-process research and development (IPR&D) impairments and asset sales and impairments, net IPR&D impairments in the six months ended June 30, 2014 related primarily to the Estelle and
Colvir products acquired in the Uteron Pharma acquisition after an identified triggering event. Asset sales and impairments related to the net impairment of some of our legacy manufacturing
plants as part of the overall global supply chain initiatives.

(15)
(16)

Interest expense - Amount in interest expense includes the amortization of the fair value step up of senior secured notes assumed as part of the Warner Chilcott acquisition.
Other income (expense), net Other income (expense), net for the six months ended June 30, 2014 includes the expensing of bridge loan commitment fees incurred in connection with the then
pending Forest acquisition of $23.0 million and the loss on the sale of the Western European assets divested of $20.9 million, offset, in part, by a gain on the sale of our investment in Columbia
Laboratories, Inc. of $4.3 million.

Product revenue for significant promoted products globally


for the three and six months ended June 30, 2015 and 2014
ALLERGAN PLC
GLOBAL NET REVENUES TOP PROMOTED PRODUCTS
(Unaudited; in millions)

June 30,
2015
Botox
Restasis
Namenda IR
Namenda XR
Fillers
Lumigan/Ganfort
Bystolic
Asacol/Dezicol
Alphagan/Combigan
Linzess/Constella
Viibryd/Fetzima
Lo Loestrin
Breast Implants
Estrace Cream
Aczone
Minastrin 24
Other Branded Products Revenues
Total Branded Products Revenues
Total Generic Products Revenues
ANDA Revenues
Total Net Revenues

34

631.5
325.0
232.6
204.7
195.9
176.5
157.1
149.3
135.5
112.1
80.7
79.2
71.8
70.1
60.3
56.1
973.6
3,712.0
1,580.6
462.4
5,755.0

Three Months Ended


Change
2014
Dollars
148.9
68.0
57.9
56.5
305.6
636.9
1,603.3
427.0
2,667.2

631.5
325.0
232.6
204.7
195.9
176.5
157.1
0.4
135.5
112.1
80.7
11.2
71.8
12.2
60.3
(0.4)
668.0
3,075.1
(22.7)
35.4
3,087.8

June 30,
%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
0.3%
100.0%
100.0%
100.0%
16.5%
100.0%
21.1%
100.0%
(0.7)%
218.6%
482.8%
(1.4)%
8.3%
115.8%

2015
$

750.8
354.9
478.0
355.3
220.5
197.7
321.2
298.5
151.5
208.3
160.3
162.5
81.4
142.0
66.3
121.5
1,687.9
5,758.6
3,306.6
924.0
9,989.2

Six Months Ended


Change
2014
Dollars
301.7
130.4
111.2
104.4
631.0
1,278.7
3,226.4
817.2
5,322.3

750.8
354.9
478.0
355.3
220.5
197.7
321.2
(3.2)
151.5
208.3
160.3
32.1
81.4
30.8
66.3
17.1
1,056.9
4,479.9
80.2
106.8
4,666.9

%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
(1.1)%
100.0%
100.0%
100.0%
24.6%
100.0%
27.7%
100.0%
16.4%
167.5%
350.3%
2.5%
13.1%
87.7%

Condensed Consolidated Balance Sheets as of June 30,


2015 and December 31, 2014
ALLERGAN PLC
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited; in millions)
June 30,
2015
Assets
Cash and cash equivalents
Marketable securities
Accounts receivable, net
Inventories
Other current assets
Current assets held for sale
Property, plant and equipment, net
Investments and other assets
Product rights and other intangibles, net
Goodwill
Total assets
Liabilities & Equity
Current liabilities
Current liabilities held for sale
Long-term debt and capital leases
Deferred income taxes and other liabilities
Total equity
Total liabilities and equity

35

December 31,
2014

1,517.9
8.5
4,420.1
2,786.0
1,716.4
38.0
2,859.0
643.9
72,825.0
51,596.3

250.0
1.0
2,372.3
2,075.5
1,233.7
949.2
1,594.7
342.8
19,188.4
24,521.5

138,411.1

52,529.1

7,649.5
41,319.4
17,367.7
72,074.5

4,992.7
25.9
14,846.3
4,328.7
28,335.5

138,411.1

52,529.1

Condensed Consolidated Statements of Cash Flows for


the three and six months ended June 30, 2015 and 2014
ALLERGAN PLC
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited; in millions)
Three Months Ended June 30,
2015
2014
Cash Flows From Operating Activities:
Net (loss) / income
Reconciliation to net cash provided by operating activities:

36

(241.6)

Six Months Ended June 30,


2015
2014
48.8

(753.9)

145.5

Depreciation
Amortization
Provision for inventory reserve
Share-based compensation
Deferred income tax benefit
In-process reasearch and development impairments
Loss / (gain) on asset sales and impairment, net
Amortization of inventory step up
Amortization of deferred financing costs
Accretion and contingent consideration
Excess tax benefit from stock-based compensation
Other, net
Changes in assets and liabilities (net of effects of acquisitions):
Decrease / (increase) in accounts receivable, net
Decrease / (increase) in inventories
Decrease / (increase) in prepaid expenses and other current assets
Increase / (decrease) in accounts payable and accrued expenses
Increase / (decrease) in income and other taxes payable
Increase / (decrease) in other assets and liabilities
Net cash provided by operating activities
Cash Flows From Investing Activities:
Additions to property, plant and equipment
Additions to product rights and other intangibles
Additions to investments
Proceeds from the sale of investments and other assets
Proceeds from sales of property, plant and equipment
Acquisitions of business, net of cash acquired
Net cash (used in) investing activities
Cash Flows From Financing Activities:
Proceeds from borrowings on long-term indebtedness
Proceeds from borrowings of credit facility and other
Debt issuance and other financing costs

75.3
1,673.5
33.1
175.2
(284.6)
197.6
0.6
493.2
12.2
(20.7)
(0.2)
70.8

49.5
422.9
37.2
14.5
(1.6)
16.3
27.8
85.4
15.3
(20.9)
14.1
0.9

132.5
2,598.9
63.4
400.7
(588.9)
197.6
58.4
706.1
280.5
8.1
(36.3)
64.3

105.1
847.1
75.3
31.2
(151.5)
16.3
27.4
210.0
26.4
(27.9)
(22.7)
(10.0)

(194.0)
(32.1)
24.2
(247.5)
(258.6)
(75.1)
1,401.3

(49.3)
(45.5)
8.7
75.6
(214.5)
(15.7)
469.5

(896.1)
(234.8)
83.1
108.6
(216.2)
(49.7)
1,926.3

(162.9)
(154.4)
30.5
53.0
(101.4)
(27.9)
909.1

(111.6)
(20.0)
(6.0)
65.3
6.6
(463.7)
(529.4)

(38.3)
3.0
0.8
(119.2)
(153.7)

(248.2)
(28.5)
(21.0)
855.8
81.5
(35,109.9)
(34,470.3)

(80.8)
18.0
4.2
(119.2)
(177.8)

0.8
72.0
-

3,676.2
80.0
(31.6)

26,456.4
2,882.0
(310.8)

3,676.2
80.0
(51.9)

Payments on debt, including capital lease obligations


Proceeds from issuance of preferred shares
Proceeds from issuance of ordinary shares
Proceeds from stock plans
Payments of contingent consideration
Repurchase of ordinary shares
Dividends
Excess tax benefit from stock-based compensation
Net cash provided by / (used in) financing activities
Effect of currency exchange rate changes on cash and cash equivalents
Movement in cash held for sale
Net increase / (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

(1,436.2)
65.6
(67.4)
(36.9)
(68.7)
0.2
(1,470.6)
1.7
(597.0)
2,114.9
1,517.9

(141.7)
1.7
(2.4)
(14.1)
3,568.1
(1.9)
73.9
3,955.9
337.7
4,293.6

(4,096.2)
4,929.7
4,071.1
108.2
(92.0)
(101.0)
(68.7)
36.3
33,815.0
(3.1)
1,267.9
250.0
1,517.9

(467.8)
8.1
(7.8)
(59.4)
22.7
3,200.1
(3.8)
37.0
3,964.6
329.0
4,293.6

Reconciliation of reported net (loss) / income and diluted EPS to nonGAAP net income and diluted EPS for the three and six months ended
June 30, 2015 and June 30, 2014
ALLERGAN PLC
RECONCILIATION TABLE
(Unaudited; in millions except per share amounts)
Three Months Ended
June 30,
2015
2014

Six Months Ended


June 30,
2015
2014

GAAP to non-GAAP net income calculation


Reported GAAP net (loss) / income attributable to
ordinary shareholders
Adjusted for:
Amortization
Global supply chain initiative (1)
Acquisition and licensing charges (2)
Accretion on contingent liabilities
Impairment/asset sales and related costs
Non-recurring losses (gains)
Legal settlements
Income taxes on items above
Non-GAAP net income attributable to
ordinary shareholders

(243.1)

1,673.5
8.2
711.5
8.9
244.9
37.7
3.0
(617.0)

48.7

422.9
14.9
165.6
4.4
19.7
1.5
(79.5)

(755.1)

145.2

2,598.9
26.0
1,884.9
12.9
310.0
37.7
3.6
(1,008.8)

847.1
30.3
310.0
8.4
22.6
(1.4)
1.5
(154.6)
$ 1,209.1

1,827.6

598.2

3,110.1

Diluted (loss) earnings per share - GAAP

(0.80)

0.28

(2.48)

0.83

Diluted earnings per share - Non-GAAP

4.41

3.42

8.71

6.91

Basic weighted average ordinary shares outstanding


Effect of dilutive securities:
Dilutive shares
Diluted weighted average ordinary shares outstanding

392.6

174.2

341.3

174.0

21.8
414.4

0.8
175.0

15.8
357.1

1.0
175.0

Diluted earnings per share

37

(1)

Includes accelerated depreciation charges.

(2)

Includes stock-based compensation due to the Allergan, Forest and Warner Chilcott acquisitions.

Reconciliation of reported net (loss) / income for the three and six
months ended June 30, 2015 and 2014 to adjusted EBITDA

ALLERGAN PLC
ADJUSTED EBITDA, RECONCILIATION TABLE
(Unaudited; in millions)
Three Months Ended
June 30,
2015
2014

GAAP net (loss) / income attributable to shareholders


Plus:
Interest expense
Interest income
(Benefit) / provision for income taxes
Depreciation (includes accelerated depreciation)
Amortization
EBITDA
Adjusted for:
Global supply chain initiative
Acquisition and licensing and other charges
Impairment/asset sales and related costs
Non-recurring losses (gains)
Legal settlements
Accretion on contingent liabilities
Share-based compensation
Adjusted EBITDA

38

(243.1)

48.7

Six Months Ended


June 30,
2015
2014

(755.1)

145.2

339.9
(2.6)
(307.3)
75.3
1,673.5
1,535.7

79.1
(1.2)
43.6
49.5
422.9
642.6

511.8
(4.4)
(485.0)
132.5
2,598.9
1,998.7

151.9
(2.2)
88.0
105.1
847.1
1,335.1

8.2
599.4
244.9
37.7
3.0
8.9
175.2
2,613.0

10.4
168.9
19.7
1.5
4.4
14.5
862.0

26.0
1,478.4
310.0
37.7
3.6
12.9
527.8
4,395.1

16.5
308.3
22.6
(1.4)
1.5
8.4
31.2
$ 1,722.2

Reconciliation of reported net revenues, cost of sales and SG&A for the three and six
months ended June 30, 2015 and 2014 to adjusted net revenues, adjusted cost of sales,
adjusted gross profit, adjusted gross margin as a percentage of adjusted net revenues,
adjusted SG&A and adjusted SG&A as a percentage of adjusted net revenues.
ALLERGAN PLC
ADJUSTED GROSS MARGIN AS A PERCENTAGE OF ADJUSTED NET REVENUES
(Unaudited; in millions)
Three Months Ended

Six Months Ended

June 30,

June 30,

2015

2014

2015

2014

Net Revenues:
$

Net revenues

5,755.0

2,667.2

9,989.2

$ 5,322.3

Adjustments to net revenue ((remove from) / add to)


Purchase accounting adjustments
Operating results of assets held for sale / sold
Adjusted net revenues
Cost of Sales

(1)

5.5

(23.5)

(37.4)

(55.0)

(149.5)

5.5

5,731.5

2,635.3

9,934.2

$ 5,178.3

2,130.1

1,296.5

3,843.5

$ 2,589.5
(4.1)

Cost of Sales
Adjustments to cost of sales ((remove from) / add to)
Integration and restructuring

(6.6)

(3.5)

(22.4)

Contingent consideration fair value and accretion adjustment

(4.4)

(7.2)

(32.4)

(7.5)

Operating results and disposal impact of assets held for sale / sold

(23.0)

(38.3)

(91.0)

(116.6)

Operational Excellence Initiative


Acquisition accounting fair market value adjustment to stock-based
compensation

(8.2)

(11.0)

(26.0)

(22.4)

(7.5)

(14.9)

(85.4)

(706.1)

(210.0)

Purchase accounting adjustments


Adjusted cost of sales

(493.2)
$

Adjusted gross profit


Adjusted gross margin as a percentage of adjusted net revenues

1,587.2

2,950.7

$ 2,228.9

4,144.3

1,151.1
1,484.2

6,983.5

2,949.4

72.3%

56.3%

70.3%

57.0%

2,889.7

$ 1,120.5

SG&A:
SG&A

1,461.2

561.6

Adjustments to SG&A ((remove from) / add to)


Legal matters
Acquisition, integration & restructuring expenses
Acquisition related currency gains
Mark to market adjustments

(3.0)

(1.5)

(365.4)

(46.7)

39.7

(37.7)

(37.7)

Contract termination payments


Other
Acquisition related costs

Adjusted SG&A as a percentage of adjusted net revenues

39

(1.5)
(52.9)

Costs associated with holding assets out for sale


Global supply chain initiative accelerated depreciation and severance
costs

Operating results and disposal impact of assets held for sale / sold
Acquisition accounting fair market value adjustment to stock-based
compensation
Adjusted SG&A

(1)

(3.0)
(90.7)

Cost of sales excludes amortization and impairment of acquired intangibles.

(3.3)

(6.4)

(10.0)

(10.0)

(0.6)
(78.4)
(4.3)

1.4
(36.9)
(33.5)

(86.6)
$

(0.5)

1,243.2
21.7%

493.4
18.7%

(5.7)

(319.2)
$

2,120.8
21.3%

981.2
18.9%

Reconciliation of expected GAAP Research & Development expense to


adjusted Research & Development expense for the three and six months
ended June 30, 2015 and 2014

ALLERGAN PLC
ADJUSTED R&D EXPENSE

(Unaudited; $ in millions)
Research and Development expense
Adjustments to research and development ((remove from) / add to)

Generic
Development
$
109.0

Contingent consideration fair value adjustments adjustments and accretion


Brand related milestone payments and upfront option payments
Acquisition, integration & restructuring expenses
Acquisition accounting fair market value adjustment to stock-based
compensation
Adjusted research and development expense

Three Months Ended June 30, 2015


Brand
Biosimilars
US Medical
Development
$
326.5
$
18.1
$
1.3

454.9

Generic
Development
$
220.4

Six Months Ended June 30, 2015


Brand
Biosimilars
US Medical
Development
$
631.6
$
32.6
$
1.3

Research and Development expense


Adjustments to research and development ((remove from) / add to)

25.5

25.1

(0.4)

25.0

24.6

(30.0)
(4.6)

(30.0)
(6.6)

(3.7)

(40.0)
(73.1)

(40.0)
(76.8)

106.6

(37.4)
$

Generic
Development
$
124.3

Contingent consideration fair value adjustments adjustments and accretion


Write-off of contingent consideration
Integration and restructuring expenses
Operating results for assets held for sale
Brand related milestone payments and upfront option payments
Accelerated depreciation and product transfer costs
Acquisition, integration & restructuring expenses
Acquisition related settlements
Adjusted research and development expense

40

885.9

(2.0)

280.0

18.1

1.3

(37.4)
$

406.0

216.3

(103.7)
$

Three Months Ended June 30, 2014


(Unaudited; $ in millions)

Total
$

(0.4)

Total

Brand
Development
$
9.4

Biosimilars
$

32.6

1.3

(103.7)
$

690.0

Six Months Ended June 30, 2014

US Medical

24.3

439.8

Total
-

158.0

Generic
Development
$
238.2

Brand
Development
$
42.6

Biosimilars
$

US Medical

Total

48.7

329.5

3.5

3.5

10.7

10.7

(0.6)
(0.8)
122.9

24.7
37.6

24.7
(0.6)
(0.8)
184.8

(0.3)
(2.7)
(1.5)
(0.8)
232.9

24.7
(0.2)
77.8

24.7
(0.3)
(2.7)
(1.5)
(0.8)
(0.2)
359.4

24.3

48.7

Q2 2015: US Brands Segment Information


Three Months Ended
June 30,
2015
2014
Net revenues
Operating expenses:
Cost of sales(1)
Selling and marketing
General and administrative
Segment contribution
Segment margin

2,435.7
307.3
459.4
47.2
1,621.8
66.6%

564.6
71.1
75.7
24.7
393.1
69.6%

(1) Excludes amortization and impairment of acquired intangibles including product rights.

Six Months Ended


June 30,
2015
2014
Net revenues
Operating expenses:
Cost of sales(1)
Selling and marketing
General and administrative
Segment contribution
Segment margin
(1) Excludes amortization and impairment of acquired intangibles including product rights.

41

4,234.1
533.9
831.7
105.7
2,762.8
65.3%

1,139.4
138.6
150.3
49.9
800.6
70.3%

Q2 2015: US Brands Revenue

42

Q2 2015: US Medical Aesthetics Segment Information

Three Months Ended


June 30,
2015
2014
Net Revenues
Operating expenses:
Cost of sales(1)
Selling and marketing
General and administrative
Segment contribution
Segment margin

486.8
34.0
97.9
11.2
343.7
70.6%

0.0%

(1) Excludes amortization and impairment of acquired intangibles including product rights.

Six Months Ended


June 30,
2015
2014
Net revenues
Operating expenses:
Cost of sales(1)
Selling and marketing
General and administrative
Segment contribution
Segment margin
(1) Excludes amortization and impairment of acquired intangibles including product rights.

43

566.6
39.0
111.6
13.9
402.1
71.0%

0.0%

Q2 2015: US Medical Aesthetics Revenue

Three Months Ended


June 30,
Change
Dollars
2015
2014
Facial Aesthetics Total
Medical Dermatology Total

Plastic Surgery Total


Total US Medical

44

263.7

263.7

100.0%

300.9

100.0%

169.0

100.0%

193.7

193.7

100.0%

54.1

54.1

100.0%

72.0

72.0

100.0%

486.8

100.0%

566.6

100.0%

300.9

566.6

169.0

486.8

Six Months Ended


June 30,
Change
Dollars
2015
2014

Q2 2015: International Brands Segment Information


Three Months Ended
June 30,
2015
2014
Net revenues
Operating expenses:
Cost of sales(1)
Selling and marketing
General and administrative
Segment contribution
Segment margin

717.0
159.5
181.8
47.5
328.2
45.8%

169.1
74.3
36.4
13.2
45.2
26.7%

(1) Excludes amortization and impairment of acquired intangibles including product rights.

Six Months Ended


June 30,
2015
2014
Net revenues
Operating expenses:
Cost of sales(1)
Selling and marketing
General and administrative
Segment contribution
Segment margin
(1) Excludes amortization and impairment of acquired intangibles including product rights.

45

947.5
244.3
249.6
70.1
383.5
40.5%

313.5
145.7
70.1
28.7
69.0
22.0%

Q2 2015: International Brands Revenue

Three Months Ended


June 30,
Change
Dollars
2015
2014
Eyecare

269.4

100.0%

172.1

100.0%

190.5

49.6

118.2

238.4%

250.5

113.8

36.1

100.0%

42.6

(47.9)

(40.1)%

157.6

172.1

Other Therapeutics
Plastic Surgery

167.8
36.1

Generics and other

71.6
$

717.0

119.5
$

269.4

Facial Aesthetics

Total International Brands

46

Six Months Ended


June 30,
Change
Dollars
2015
2014

169.1

547.9

324.0%

306.3

947.5

199.7
$

313.5

306.3

100.0%

190.5

100.0%

136.7

120.1%

42.6

100.0%

(42.1)

(21.1)%

634.0

202.2%

Q2 2015: Global Generics Segment Information


Three Months Ended
June 30,
2015
2014
Net revenues
Operating expenses:
Cost of sales(1)
Selling and marketing
General and administrative
Segment contribution
Segment margin

1,629.0
680.3
162.1
82.2
704.4
43.2%

1,474.6
631.2
136.6
97.0
609.8
41.4%

(1) Excludes amortization and impairment of acquired intangibles including product rights.

Six Months Ended


June 30,
2015
2014
Net revenues
Operating expenses:
Cost of sales(1)
Selling and marketing
General and administrative
Segment contribution
Segment margin
(1) Excludes amortization and impairment of acquired intangibles including product rights.

47

3,260.8
1,321.7
296.5
177.2
1,465.4
44.9%

2,908.3
1,238.9
255.5
207.6
1,206.3
41.5%

Q2 2015: Global Generics Revenue

Three Months Ended


June 30,
Change
Dollars
2015
2014
United States

$ 1,077.1

UK & Ireland

190.5

Other markets

361.4

Total Global Generics

48

$ 1,629.0

997.4

%
8.0%

$ 2,269.2

115.3

75.2

65.2%

325.1

214.7

110.4

51.4%

361.9

(0.5)

-0.1%

666.5

705.8

(39.3)

(5.6)%

10.5%

$ 3,260.8

154.4

1,987.8

2,908.3

281.4

79.7

1,474.6

Six Months Ended


June 30,
Change
Dollars
2015
2014

352.5

14.2%

12.1%

Q2 2015: Anda Distribution Segment Information


Three Months Ended
June 30,
2015
2014
Net revenues
Operating expenses:
Cost of sales(1)
Selling and marketing
General and administrative
Segment contribution
Segment margin

462.4
404.5
31.3
8.9
17.7
3.8%

427.0
374.5
27.1
8.8
16.6
3.9%

(1) Excludes amortization and impairment of acquired intangibles including product rights.

Six Months Ended


June 30,
2015
2014
Net revenues
Operating expenses:
Cost of sales(1)
Selling and marketing
General and administrative
Segment contribution
Segment margin
(1) Excludes amortization and impairment of acquired intangibles including product rights.

49

924.0
808.5
62.7
18.0
34.8
3.8%

817.2
705.7
54.1
16.6
40.8
5.0%