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Endo Reports Fourth Quarter Financial Results And Reaffirms 2013 Financial Guidance

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MALVERN, Pa., Feb. 28, 2013 /PRNewswire/ --

  • Total quarterly revenues of $801 million, comparable to prior year.
  • Fourth quarter reported diluted (GAAP) loss per share of $6.35 includes a $640 million non-cash asset impairment charge related primarily to goodwill and other intangible assets attributable to the company's American Medical Systems (AMS) segment.
  • Fourth quarter adjusted diluted EPS of $1.62 increased by 16 percent versus prior year; Full year 2012 adjusted diluted EPS of $5.02 was in-line with financial guidance.
  • Company continues to expect 2013 revenues in the range of $2.80 billion to $2.95 billion.
  • Company continues to expect 2013 adjusted diluted EPS in the range of $4.40 to $4.70;
  • Company expects reported diluted (GAAP) EPS in the range of $2.22 to $2.52.

Endo Health Solutions (Nasdaq: ENDP) today reported total revenues during the fourth quarter of 2012 of $801 million, relatively flat when compared to $803 million in the same quarter of 2011. Endo incurred a net reported loss for the three months ended Dec 31, 2012 of $716 million, compared with reported net income of $37 million reported in the comparable 2011 period.

The net loss reported for the period includes the effect of a non-cash charge in the amount of $714 million for the period to reflect the impairment of certain assets. The primary driver for this charge is a $640 million reduction in goodwill and other intangible assets attributable to the company's AMS segment.

The net reported loss reported for the period also includes a charge in the amount of $232 million for the period reflecting the impact of accruals for legal and other contingencies. The primary driver for this charge is a tentative agreement with the government related to its investigation of the sale, marketing and promotion of LIDODERM® which agreement including an incremental fourth quarter charge results in a total estimate of $194 million for this matter.  The remainder of this charge reflects a $92 million reserve for product liability claims.

As detailed in the supplemental financial information below, adjusted net income for the three months ended Dec 31, 2012 was $187 million, compared with $168 million in the same period in 2011. Reported diluted loss per share for the quarter ended Dec 31, 2012 was $6.35, compared with EPS of $0.30 in the fourth quarter of 2011. Adjusted diluted EPS for the same period were $1.62 compared with $1.40 reported in 2011. 

Total revenues for the twelve months ended Dec 31, 2012 of $3.03 billion increased 11 percent versus the prior year period.  Adjusted diluted EPS for the full year of 2012 were $5.02 which was in-line with the company's previous financial guidance of at or below the range from $5.00 to $5.10.

"Our focus is on the future and in creating and delivering value to our shareholders and our customers," said Dave Holveck, president and CEO of Endo. "Endo faced a number of challenges in 2012 that we've worked to address, and, in doing so, we believe will result in improved execution in 2013 and beyond."



 

 

FINANCIAL PERFORMANCE AT A GLANCE



($ in thousands, except
per share amounts)





4th Quarter







Twelve Months Ended
December 31,







2012



2011



Change



2012



2011



Change

Total Revenues

$

801,060





$

803,406







$

3,027,363





$

2,730,121





11 %

Reported Net Income

$

(716,266)





$

36,594





NM



$

(740,337)





$

187,613





NM

Reported Diluted EPS

$

(6.35)





$

0.30





NM



$

(6.40)





$

1.55





NM

Adjusted Net Income

$

186,586





$

168,186





11 %



$

600,132





$

568,153





6 %

Adjusted Diluted EPS

$

1.62





$

1.40





16 %



$

5.02





$

4.69





7 %

ENDO PHARMACEUTICALS

Branded pharmaceutical revenues of $455 million for the fourth quarter represents a decrease of 1 percent versus the prior year.

Net sales of LIDODERM® increased 17 percent for the fourth quarter on 4 percent prescription growth. The increase in LIDODERM net sales is primarily a result of changes with respect to royalty obligations among Endo Pharmaceuticals, Hind Healthcare Inc., and Teikoku Seiyaku Co. Ltd.; changes that began in Nov 2011 and have been previously described in our filings with the U.S. Securities and Exchange Commission.

Net sales of Opana® ER decreased 43 percent for the fourth quarter on 37 percent lower prescriptions. The decrease in Opana ER net sales is primarily a result of the Novartis plant closure in Lincoln, Neb. in the first quarter of 2012, which caused some patients to switch to other pain relief products, and a slower return to growth for Opana ER following this disruption.

As captured in our amended Citizen's Petition in Nov 2012, Endo submitted emerging safety data that demonstrate that the introduction in the first quarter of 2012 of the reformulated OPANA ER designed to be crush-resistant, is reducing rates of abuse. Comparisons of abuse rates for OPANA ER, from the third quarter of 2011 through the third quarter of 2012, demonstrate that the reported rate of abuse of the reformulated OPANA ER was reduced by 59 percent, based on the total number of prescriptions dispensed, versus the rate observed for the non-crush-resistant formulation of OPANA ER, which is no longer being manufactured by the company.

Net sales of Voltaren® Gel decreased less than 1 percent for the fourth quarter on 2 percent higher prescriptions. Voltaren Gel net sales for full year 2012 were affected by the Novartis plant closure in Lincoln, Neb. The return to prescription growth for Voltaren Gel has been strong and the product achieved a record high for quarterly total prescription volume during fourth quarter 2012.

QUALITEST

Generic product net sales of $162 million for the fourth quarter 2012 represented an increase of 7 percent over the same period last year.  For the full year of 2012 sales increased 12 percent versus prior year and this growth was driven by strong demand for Qualitest's diversified product portfolio and favorable pricing, resulting in expanding gross profit margins. Qualitest remains focused on process improvements and increased efficiencies in order to enhance manufacturing capacity.

In Nov 2012, Qualitest received FDA approval of Gildagia, ethinyl estradiol and norethindrone tablets, 0.035mg/0.4mg. Total combined branded and generic sales in the U.S. of these products for the 12 months ended Dec 31, 2012 were approximately $23 million, according to IMS Health.

In Dec 2012, Qualitest received FDA approval of disulfiram tablets a generic version of Antabuse®. Total combined branded and generic sales in the U.S. of these products for the 12 months ended Dec 31, 2012 were approximately $18 million, according to IMS Health.  

AMS

Devices sales were $133 million for the fourth quarter 2012 a reported decrease of 6 percent driven by declines in US-based sales.  International sales of AMS products increased approximately 5 percent in fourth quarter 2012 versus the prior year period.  Men's Health sales decreased 3 percent in the fourth quarter of 2012, compared with same period last year. On a year-to-date pro forma basis, net sales for Men's Health products increased 3 percent. Net sales for AMS's benign prostatic hyperplasia (BPH) business increased 1 percent in the fourth quarter of 2012.

Women's Health sales decreased 18 percent in the fourth quarter of 2012, compared with the same period last year. On a year-to-date pro forma basis, net sales for Women's Health products decreased 24 percent. Net sales declines in Women's Health were driven by year-over-year declines in procedural volumes reflecting recent industry shifts following the FDA's September 2011 advisory committee meeting regarding the use of surgical mesh in pelvic organ prolapse. AMS remains focused on educational activities as part of an overall effort to continue to encourage patients and physicians to discuss the risks and benefits of AMS's surgical mesh devices as an important treatment option for patients who suffer from stress urinary incontinence and pelvic organ prolapse.

HEALTHTRONICS

Services sales of $51 million for the fourth quarter 2012 represented a decrease of 1 percent over the same period last year. The fourth quarter decline in sales for HealthTronics was driven by decreased volumes in lithotripsy services and prostate services. This was partially offset by increased sales of HealthTronics' electronic medical records offerings.

In January, the company announced a partnership agreement for a practice management application that is expected to be integrated with HealthTronics' electronic medical records offerings. Data offerings are expected to be an important component of the evolving HealthTronics strategy in 2013.

2013 Financial Guidance

Endo's estimates are based on estimated results for the year ended Dec 31, 2013 and management's current belief about prescription trends, pricing levels, inventory levels and the anticipated timing of future product launches and events. The company's guidance for reported (GAAP) earnings per share does not include any estimates for potential new corporate development transactions. For the full year ended Dec 31, 2013, Endo estimates:

  • Total revenue to be between $2.80 billion and $2.95 billion
  • Reported (GAAP) diluted earnings per share to be between $2.22 and $2.52
  • Adjusted diluted earnings per share to be between $4.40 and $4.70
  • Capital expenditures to be approximately $120 million

The company's 2013 guidance is based on certain assumptions including:

  • Adjusted gross margin of between 64 percent and 66 percent
  • Adjusted effective tax rate of between 28.5 percent and 29.5 percent
  • Weighted average number of diluted common shares outstanding of approximately 115 million shares for the year ended Dec 31, 2013
  • The company assumes the launch of a non-AB rated, full-line generic extended release oxymorphone in early January resulting in increased competition for the first six months of 2013. The company further assumes no generic competition thereafter due to the anticipated outcome of an FDA decision in late May 2013 that could remove generic formulations of extended release oxymorphone from the market. Consistent with its Citizens Petition, the company continues to believe that sufficient evidence exists to support a determination by FDA that the old formulation of OPANA® ER was discontinued for reasons of safety, which serves the public health. The company's expected revenues for 2013 reflect a reduction in 2013 OPANA ER net sales of 20% versus 2012 net sales, due to the effect of potential erosion in market share from such single, non-AB-rated generic competitor combined with the impact of recent prescription trends reflecting flat market share.
  • The company continues to expect a single generic competitor for LIDODERM in September 2013 as a result of a previously announced settlement agreement with Watson Pharmaceuticals
  • The company expects low-double digit revenue growth from Qualitest and expects low-single digit revenue growth for AMS in 2013.

Balance Sheet Update

During the fourth quarter of 2012, Endo made mandatory payments of approximately $28 million to reduce the outstanding principal of term loan debt associated with the acquisition of AMS. This brings the total repayments on this debt to approximately $652 million, inclusive of approximately $538 million in cumulative voluntary prepayments, through fourth quarter 2012.

Additionally, during the fourth quarter of 2012, Endo repurchased $100 million of its common stock following the Board of Directors' authorization to repurchase up to $450 million of its common stock through March 2015. Additional repurchases may vary based on market conditions, securities law limitations and other factors.

Conference Call Information

Endo will conduct a conference call with financial analysts to discuss this news release today at 4:30 p.m. ET. Investors and other interested parties may call 866-788-0540 (domestic) or +1 857-350-1678 (international) and enter passcode 24422412. Please dial in 10 minutes prior to the scheduled start time.

A replay of the call will be available from Feb 28, 2013 at 6:30 p.m. ET until 12:00 p.m. ET on Mar 14, 2013 by dialing 888-286-8010 (domestic) or +1 617-801-6888 (international) and entering passcode 81861650.

A simultaneous webcast of the call can be accessed by visiting www.endo.com. In addition, a replay of the webcast will be available until 12:00 p.m. ET on Mar 14, 2013. The replay can be accessed by clicking on "Events" in the Investor Relations section of the website.

Supplemental Financial Information

The following tables provide a reconciliation of our reported (GAAP) statements of operations to our adjusted statements of operations (Non-GAAP) for each of the three months ended Dec 31, 2012 and 2011 (in thousands, except per share data):

 

Three Months Ended December 31, 2012 (unaudited)

 Actual
Reported
 (GAAP)



Adjustments





Non-GAAP
Adjusted

REVENUES

$

801,060





$







$

801,060

















COSTS AND EXPENSES:













Cost of revenues

307,436





(52,457)



(1)



254,979



Selling, general and administrative

200,325





(18,838)



(2)



181,487



Research and development

43,053





(7,554)



(3)



35,499



Patent litigation settlement items, net













Litigation-related and other contingencies

233,825





(233,825)



(4)





Asset impairment charges

714,304





(714,304)



(5)





Acquisition-related and integration items, net

6,435





(6,435)



(6)





OPERATING (LOSS) INCOME

$

(704,318)





$

1,033,413







$

329,095



INTEREST EXPENSE, NET

44,448





(5,408)



(7)



39,040



OTHER INCOME, NET

(691)





300



(8)



(391)



(LOSS) INCOME BEFORE INCOME TAX

$

(748,075)





$

1,038,521







$

290,446



INCOME TAX

(44,299)





135,669



(9)



91,370



CONSOLIDATED NET (LOSS) INCOME

$

(703,776)





$

902,852







$

199,076



Less: Net income attributable to noncontrolling interests

12,490











12,490



NET (LOSS) INCOME ATTRIBUTABLE TO ENDO HEALTH SOLUTIONS INC.

$

(716,266)





$

902,852







$

186,586



DILUTED (LOSS) EARNINGS PER SHARE

$

(6.35)











$

1.62



DILUTED WEIGHTED AVERAGE SHARES

112,811











114,929





















Notes to reconciliation of our GAAP statements of operations to our adjusted statements of operations:

(1)

To exclude amortization of commercial intangible assets related to marketed products of $53,852, an adjustment to the accrual for the payment to Impax related to sales of OPANA ER of $(2,000) and certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations of $605.

(2)

To exclude certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations and other miscellaneous costs totaling $16,089 and amortization of customer relationships of $2,749.

(3)

To exclude milestone payments to partners of $4,173 and certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations of $3,381.

(4)

To exclude the net impact of accruals for litigation-related and other contingencies.

(5)

To exclude asset impairment charges.

(6)

To exclude acquisition-related and integration costs of $6,226 and a loss of $209 recorded to reflect the change in fair value of the contingent consideration associated with the Qualitest acquisition.

(7)

To exclude additional interest expense as a result of adopting ASC 470-20.

(8)

To exclude milestone-related activity.

(9)

To reflect the cash tax savings results from our recent acquisitions and the tax effect of the pre-tax adjustments above at applicable tax rates.

 

Three Months Ended December 31, 2011 (unaudited)

 Actual
Reported
 (GAAP)



Adjustments





Non-GAAP
Adjusted

REVENUES

$

803,406





$







$

803,406

















COSTS AND EXPENSES:













Cost of revenues

294,781





(61,449)



(1)



233,332



Selling, general and administrative

231,393





(5,962)



(2)



225,431



Research and development

55,432





(752)



(3)



54,680



Litigation-related and other contingencies

11,263





(11,263)



(4)





Asset impairment charges

93,398





(93,398)



(5)





Acquisition-related and integration items, net

4,121





(4,121)



(6)





OPERATING INCOME

$

113,018





$

176,945







$

289,963



INTEREST EXPENSE, NET

50,882





(4,938)



(7)



45,944



NET LOSS ON EXTINGUISHMENT OF DEBT

3,371





(3,371)



(8)





OTHER INCOME, NET

(491)











(491)



INCOME BEFORE INCOME TAX

$

59,256





$

185,254







$

244,510



INCOME TAX

9,343





53,662



(9)



63,005



CONSOLIDATED NET INCOME

$

49,913





$

131,592







$

181,505



Less: Net income attributable to noncontrolling interests

13,319











13,319



NET INCOME ATTRIBUTABLE TO ENDO HEALTH
SOLUTIONS INC.

$

36,594





$

131,592







$

168,186



DILUTED EARNINGS PER SHARE

$

0.30











$

1.40



DILUTED WEIGHTED AVERAGE SHARES

120,418











120,418





















Notes to reconciliation of our GAAP statements of operations to our adjusted statements of operations:

(1)

To exclude amortization of commercial intangible assets related to marketed products of $51,925, the impact of inventory step-up recorded as part of acquisition accounting of $8,720 and certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations of $804.

(2)

To exclude certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations of $3,419 and amortization of customer relationships of $2,543.

(3)

To exclude milestone and upfront payments to partners.

(4)

To exclude the accrual of an unfavorable court decision and attorneys' fees in the matter of Allmed Systems Inc. d/b/a Lisa Laser USA, Inc. and Lisa Laser Products OHG. vs. HealthTronics, Inc., which is currently pending appeal.

(5)

To exclude asset impairment charges.

(6)

To exclude acquisition-related and integration costs of $4,026 and a loss of $95 recorded to reflect the change in fair value of the contingent consideration associated with the Qualitest acquisition.

(7)

To exclude additional interest expense as a result of adopting ASC 470-20.

(8)

To exclude the unamortized debt issuance costs written off and recorded as a loss on extinguishment of debt upon our 2011 prepayments on our Term Loan indebtedness.

(9)

To reflect the cash tax savings results from our recent acquisitions and the tax effect of the pre-tax adjustments above at applicable tax rates.

 

The following tables provide a reconciliation of our reported (GAAP) statements of operations to our adjusted statements of operations for each of the twelve months ended Dec 31, 2012 and 2011 (in thousands, except per share data):

Twelve Months Ended December 31, 2012 (unaudited)

 Actual
Reported
 (GAAP)



Adjustments





Non-GAAP
Adjusted

REVENUES

$

3,027,363





$







$

3,027,363

















COSTS AND EXPENSES:













Cost of revenues

1,261,093





(325,314)



(1)



935,779



Selling, general and administrative

898,847





(48,882)



(2)



849,965



Research and development

226,120





(63,755)



(3)



162,365



Patent litigation settlement items, net

85,123





(85,123)



(4)





Litigation-related and other contingencies

316,425





(316,425)



(5)





Asset impairment charges

768,467





(768,467)



(6)





Acquisition-related and integration items, net

23,015





(23,015)



(7)





OPERATING (LOSS) INCOME

$

(551,727)





$

1,630,981







$

1,079,254



INTEREST EXPENSE, NET

182,834





(20,762)



(8)



162,072



NET LOSS ON EXTINGUISHMENT OF DEBT

7,215





(7,215)



(9)





OTHER INCOME, NET

(193)











(193)



(LOSS) INCOME BEFORE INCOME TAX

$

(741,583)





$

1,658,958







$

917,375



INCOME TAX

(53,562)





318,489



(10)



264,927



CONSOLIDATED NET (LOSS) INCOME

$

(688,021)





$

1,340,469







$

652,448



Less: Net income attributable to noncontrolling interests

52,316











52,316



NET (LOSS) INCOME ATTRIBUTABLE TO ENDO HEALTH SOLUTIONS INC.

$

(740,337)





$

1,340,469







$

600,132



DILUTED (LOSS) EARNINGS PER SHARE

$

(6.40)











$

5.02



DILUTED WEIGHTED AVERAGE SHARES

115,719











119,545





















Notes to reconciliation of our GAAP statements of operations to our adjusted statements of operations:

(1)

To exclude amortization of commercial intangible assets related to marketed products of $216,266, the impact of inventory step-up recorded as part of acquisition accounting of $880, the accrual for the payment to Impax related to sales of OPANA ER of $102,000, net milestone payments of $2,927 and certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations of $3,241.

(2)

To exclude certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations and other miscellaneous costs totaling $37,888 and amortization of customer relationships of $10,994.

(3)

To exclude milestone payments to partners of $57,851 and certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations of $5,904.

(4)

To exclude the net impact of the Watson litigation settlement.

(5)

To exclude the net impact of accruals for litigation-related and other contingencies.

(6)

To exclude asset impairment charges.

(7)

To exclude acquisition-related and integration costs of $22,778 and a loss of $237 recorded to reflect the change in fair value of the contingent consideration associated with the Qualitest acquisition.

(8)

To exclude additional interest expense as a result of adopting ASC 470-20.

(9)

To exclude the unamortized debt issuance costs written off and recorded as a loss on extinguishment of debt upon our 2012 prepayments on our Term Loan indebtedness.

(10)

To reflect the cash tax savings results from our recent acquisitions and the tax effect of the pre-tax adjustments above at applicable tax rates.

 

Twelve Months Ended December 31, 2011 (unaudited)

 Actual
Reported
 (GAAP)



Adjustments





Non-GAAP
Adjusted

REVENUES

$

2,730,121





$







$

2,730,121

















COSTS AND EXPENSES:













Cost of revenues

1,065,208





(245,089)



(1)



820,119



Selling, general and administrative

813,271





(26,139)



(2)



787,132



Research and development

182,286





(19,098)



(3)



163,188



Litigation-related and other contingencies

11,263





(11,263)



(4)





Asset impairment charges

116,089





(116,089)



(5)





Acquisition-related and integration items, net

33,638





(33,638)



(6)





OPERATING INCOME

$

508,366





$

451,316







$

959,682



INTEREST EXPENSE, NET

148,024





(18,952)



(7)



129,072



NET LOSS ON EXTINGUISHMENT OF DEBT

11,919





(11,919)



(8)





OTHER INCOME, NET

(3,268)





2,636



(9)



(632)



INCOME BEFORE INCOME TAX

$

351,691





$

479,551







$

831,242



INCOME TAX

109,626





99,011



(10)



208,637



CONSOLIDATED NET INCOME

$

242,065





$

380,540







$

622,605



Less: Net income attributable to noncontrolling interests

54,452











54,452



NET INCOME ATTRIBUTABLE TO ENDO HEALTH
SOLUTIONS INC.

$

187,613





$

380,540







$

568,153



DILUTED EARNINGS PER SHARE

$

1.55











$

4.69



DILUTED WEIGHTED AVERAGE SHARES

121,178











121,178





















Notes to reconciliation of our GAAP statements of operations to our adjusted statements of operations:



(1)

To exclude amortization of commercial intangible assets related to marketed products of $184,496, the impact of inventory step-up recorded as part of acquisition accounting of $49,438, certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations of $2,155 and milestone payments to partners of $9,000.

(2)

To exclude certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations of $19,666 and amortization of customer relationships of $6,473.

(3)

To exclude milestone and upfront payments to partners.

(4)

To exclude the accrual of an unfavorable court decision and attorneys' fees in the matter of Allmed Systems Inc. d/b/a Lisa Laser USA, Inc. and Lisa Laser Products OHG. vs. HealthTronics, Inc., which is currently pending appeal.

(5)

To exclude asset impairment charges.

(6)

To exclude acquisition-related and integration costs of $41,001 and a gain of $(7,363) recorded to reflect the change in fair value of the contingent consideration associated with the Indevus and Qualitest acquisitions.

(7)

To exclude additional interest expense as a result of adopting ASC 470-20.

(8)

To exclude the unamortized debt issuance costs written off and recorded as a loss on extinguishment of debt of $8,548 upon the early termination of our 2010 Credit Facility and $3,371 upon our 2011 prepayments on our Term Loan indebtedness.

(9)

To exclude the gain on hedging activities for foreign currencies.

(10)

To reflect the cash tax savings results from our recent acquisitions and the tax effect of the pre-tax adjustments above at applicable tax rates.

Non-GAAP Adjusted net income and its components and Non-GAAP Adjusted diluted EPS are not, and should not be viewed as, substitutes for U.S. GAAP net income and its components and diluted EPS. Despite the importance of these measures to management in goal setting and performance measurement, we stress that Non-GAAP Adjusted income and its components are Non-GAAP financial measures that have no standardized meaning prescribed by U.S. GAAP and, therefore, have limits in their usefulness to investors. Because of the non-standardized definitions, Non-GAAP Adjusted net income and its components (unlike U.S. GAAP net income and its components) may not be comparable to the calculation of similar measures of other companies. Non-GAAP Adjusted net income and its components are presented solely to permit investors to more fully understand how management assesses performance. See Endo's Current Report on Form 8-K filed today with the Securities and Exchange Commission for an explanation of Endo's reasons for using non-GAAP measures.

Reconciliation of Projected GAAP Diluted Earnings Per Share to Adjusted Diluted Earnings Per Share
Guidance for 2013







Year Ending
December 31, 2013



Projected GAAP diluted income per common share

$

2.22

To



$

2.52

Upfront and milestone-related payments to partners

0.51





0.51



Amortization of commercial intangible assets and inventory step-up

1.88





1.88



Acquisition and integration costs related to recent acquisitions.

0.39





0.39



Watson litigation settlement

(0.38)





(0.38)



Interest expense adjustment for ASC 470-20 and other treasury related items

0.20





0.20



Tax effect of pre-tax adjustments at the applicable tax rates and certain other
expected cash tax savings as a result of recent acquisitions

(0.42)





(0.42)



Diluted adjusted income per common share guidance

$

4.40

To



$

4.70



















The company's guidance is being issued based on certain assumptions including:



  • Certain of the above amounts are based on estimates and there can be no assurance that Endo will achieve these results.
  • Includes all completed business development transactions as of Feb 28, 2013.

About Endo

Endo Health Solutions Inc. (Endo) is a US-based diversified healthcare company that is redefining healthcare value by finding solutions for the unmet needs of patients along care pathways for pain management, pelvic health, urology, endocrinology and oncology. Through our operating companies: Endo Pharmaceuticals, Qualitest, AMS and HealthTronics, Endo is dedicated to improving care through a combination of branded products, generics, devices, technology and services that creates maximum value for patients, providers and payers alike. Learn more at www.endo.com.



(Tables Attached)

The following tables present Endo's unaudited Net Revenues for the three and twelve months ended Dec 31, 2012 and 2011:

 



 

Endo Health Solutions Inc.

Net Revenues (unaudited)

(in thousands)



































Three Months Ended December 31,



Percent
Growth



Twelve Months Ended December 31,



Percent
Growth



2012



2011





2012



2011



Endo Pharmaceuticals:























LIDODERM®

$

271,378





$

232,252





17

%



$

947,680





$

825,181





15

%

OPANA® ER

62,556





109,118





(43)

%



299,287





384,339





(22)

%

Voltaren® Gel

38,390





38,488









117,563





142,701





(18)

%

PERCOCET®

29,993





21,835





37

%



103,406





104,600





(1)

%

FROVA®

15,989





15,994









61,341





58,180





5

%

SUPPRELIN® LA

14,639





13,683





7

%



57,416





50,115





15

%

VANTAS®

5,155





8,366





(38)

%



17,507





18,978





(8)

%

VALSTAR®

6,346





5,301





20

%



27,063





21,521





26

%

FORTESTA® Gel

9,063





5,401





68

%



30,589





14,869





106

%

Other Branded Products

780





4,224





(82)

%



2,568





21,751





(88)

%

Royalty and Other  
          Revenue

690





3,813





(82)

%



13,564





15,532





(13)

%

Total Endo Pharmaceuticals

$

454,979





$

458,475





(1)

%



$

1,677,984





$

1,657,767





1

%

Total Qualitest

$

161,955





$

151,423





7

%



$

633,265





$

566,854





12

%

American Medical
Systems:























Men's Health

67,151





69,520





(3)

%



259,879





145,836





78

%

Women's Health

32,458





39,482





(18)

%



128,221





85,509





50

%

BPH Therapy

33,277





32,966





1

%



116,387





68,954





69

%

Total AMS

132,886





141,968





(6)

%



504,487





300,299





68

%

HealthTronics

51,240





51,540





(1)

%



211,627





205,201





3

%

Total Revenue

801,060





803,406









3,027,363





2,730,121





11

%





































 

The following table presents Endo's unaudited Pro forma Net Revenues for the eight quarters ended Dec 31, 2012 giving effect to the AMS acquisition as if it had occurred on Jan 1, 2011:

 

 



Endo Health Solutions Inc.

Net Pro Forma Revenues (unaudited)

(in thousands)











2011



2012

Endo Pharmaceuticals:

Q1





Q2





Q3





Q4





Q1





Q2





Q3





Q4



LIDODERM®

$

189,725





$

195,840





$

207,364





$

232,252





$

210,014





$

228,006





$

238,282





$

271,378



OPANA® ER

84,615





92,853





97,753





109,118





81,086





93,413





62,232





62,556



Voltaren® Gel

31,298





36,655





36,260





38,488









43,690





35,483





38,390



PERCOCET®

26,960





27,675





28,130





21,835





23,380





25,824





24,209





29,993



FROVA®

13,208





14,163





14,815





15,994





15,644





14,002





15,706





15,989



SUPPRELIN® LA

11,222





12,515





12,695





13,683





13,446





14,797





14,534





14,639



VANTAS®

3,545





2,054





5,013





8,366





3,892





4,346





4,114





5,155



VALSTAR®

4,801





5,124





6,295





5,301





6,236





6,087





8,394





6,346



FORTESTA® Gel

(969)





2,028





8,409





5,401





5,822





6,881





8,823





9,063



Other Branded 
          Products

6,970





5,609





4,948





4,224





(265)





1,120





933





780



Royalty and      
         Other Revenue

4,221





3,751





3,829





3,813





4,319





4,620





3,935





690



Total Endo Pharmaceuticals

$

375,596





$

398,267





$

425,511





$

458,475





$

363,574





$

442,786





$

416,645





$

454,979



Total Qualitest

$

134,409





$

133,047





$

147,975





$

151,423





$

145,345





$

159,895





$

166,070





$

161,955



American Medical
Systems:































































Men's Health



67,407







47,790







66,548







69,520







67,440







66,972







58,316







67,151



Women's Health



45,325







46,689







38,240







39,482







33,898







32,466







29,399







32,458



BPH Therapy



28,054







29,784







26,731







32,966







28,828







28,693







25,589







33,277



Total AMS

$

140,786





$

124,263





$

131,519





$

141,968





$

130,166





$

128,131





$

113,304





$

132,886



HealthTronics(1)



50,103







49,485







54,073







51,540







51,548







54,376







54,463







51,240



Total Revenue

$

700,894





$

705,062





$

759,078





$

803,406





$

690,633





$

785,188





$

750,482





$

801,060



































































(1)

The HealthTronics segment does not include the pro forma impact of pre-acquisition revenues from the recently acquired electronic medical records providers, Intuitive Medical Software (IMS) and meridianEMR, Inc.

 

The following table presents unaudited condensed consolidated Balance Sheet data at Dec 31, 2012 and 2011:

 



December 31,
2012



December 31,
2011

ASSETS







CURRENT ASSETS:







Cash and cash equivalents

$

547,916





$

547,620



Accounts receivable

690,850





733,222



Inventories, net

357,638





262,419



Other assets

372,830





244,835



Total current assets

$

1,969,234





$

1,788,096



PROPERTY, PLANT AND EQUIPMENT, NET

385,668





297,731



GOODWILL

2,014,351





2,558,041



OTHER INTANGIBLES, NET

2,098,973





2,504,124



OTHER ASSETS

100,333





144,591



TOTAL ASSETS

$

6,568,559





$

7,292,583



LIABILITIES AND STOCKHOLDERS' EQUITY







CURRENT LIABILITIES:







Accounts payable and accrued expenses

$

1,587,827





$

993,216



Other current liabilities

140,193





128,562



Total current liabilities

$

1,728,020





$

1,121,778



DEFERRED INCOME TAXES

516,565





617,677



LONG-TERM DEBT, LESS CURRENT PORTION, NET

3,037,947





3,424,329



OTHER LIABILITIES

152,821





89,208



STOCKHOLDERS' EQUITY:







Total Endo Health Solutions Inc. stockholders' equity

$

1,072,856





$

1,977,690



Noncontrolling interests

60,350





61,901



Total stockholders' equity

$

1,133,206





$

2,039,591



TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

6,568,559





$

7,292,583



















The following table presents unaudited condensed consolidated Statement of Cash Flow data for the twelve months ended Dec 31, 2012 and 2011:

 





Twelve Months Ended December 31,



2012



2011

OPERATING ACTIVITIES:







Consolidated net (loss) income

$

(688,021)





$

242,065



Adjustments to reconcile consolidated net income to Consolidated net (loss) 
          income







Depreciation and amortization

285,524





237,414



Stock-based compensation

59,395





46,013



Amortization of debt issuance costs and premium / discount

36,699





32,788



Other

585,889





44,254



Changes in assets and liabilities which provided cash

454,393





99,581



Net cash provided by operating activities

733,879





702,115



INVESTING ACTIVITIES:







Purchases of property, plant and equipment, net

(98,392)





(57,757)



Acquisitions, net of cash acquired

(3,175)





(2,393,397)



Other

13,100





77,062



Net cash used in investing activities

(88,467)





(2,374,092)



FINANCING ACTIVITIES:







Purchase of common stock, net of issuance of common stock from treasury

(249,938)





(34,702)



Cash distributions to noncontrolling interests

(53,269)





(53,997)



Principal (payments) borrowings on indebtedness, net

(363,040)





1,891,584



Exercise of Endo Health Solutions Inc. stock options

19,358





28,954



Other

1,342





(79,158)



Net cash (used in) provided by financing activities

(645,547)





1,752,681



Effect of foreign exchange rate

431





702



NET INCREASE IN CASH AND CASH EQUIVALENTS

296





81,406



CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD

547,620





466,214



CASH AND CASH EQUIVALENTS, END OF PERIOD

$

547,916





$

547,620



















Safe Harbor Statement

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements including words such as "believes," "expects," "anticipates," "intends," "estimates," "plan," "will," "may," "look forward," "intend," "guidance," "future" or similar expressions are forward-looking statements. Because these statements reflect our current views, expectations and beliefs concerning future events, these forward-looking statements involve risks and uncertainties. Investors should note that many factors, as more fully described under the caption "Risk Factors" in our Form 10-K, Form 10-Q and Form 8-K filings with the Securities and Exchange Commission and as otherwise enumerated herein or therein, could affect our future financial results and could cause our actual results to differ materially from those expressed in forward-looking statements contained in our Annual Report on Form 10-K. The forward-looking statements in this press release are qualified by these risk factors. These are factors that, individually or in the aggregate, could cause our actual results to differ materially from expected and historical results. We assume no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise.

SOURCE Endo Health Solutions

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