Assertio Holdings, Inc. (“Assertio” or the “Company”) (Nasdaq:
ASRT), a specialty pharmaceutical company offering differentiated
products to patients, today reported financial results for the
third quarter ended September 30, 2022.
Financial Highlights (unaudited):
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
(in millions, except per share
amounts) |
2022 |
|
2021 |
|
2022 |
|
|
2021 |
|
Net Product Sales (GAAP) |
$ |
34.3 |
|
$ |
26.0 |
|
$ |
105.3 |
|
$ |
77.3 |
|
Net Income (loss)
(GAAP) |
$ |
4.2 |
|
$ |
3.7 |
|
$ |
21.1 |
|
$ |
(5.9 |
) |
Earnings (loss) Per
Share (GAAP) |
$ |
0.08 |
|
$ |
0.08 |
|
$ |
0.42 |
|
$ |
(0.14 |
) |
Adjusted EBITDA
(Non-GAAP)1 |
$ |
21.4 |
|
$ |
15.8 |
|
$ |
68.2 |
|
$ |
31.0 |
|
Adjusted Earnings Per
Share (Non-GAAP)1 |
$ |
0.22 |
|
$ |
0.19 |
|
$ |
0.85 |
|
$ |
0.27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Third quarter net product sales increased 32% year-over-year to
$34.3 million.
- Increased sales of Indocin and the addition of Otrexup more
than offset the expected declines in Zipsor and Solumatrix.
- Indocin sales increased 50%, primarily due to net pricing,
offset by lower volumes due to a deliberate reduction in channel
inventories in the quarter.
- Third quarter GAAP net income increased to $4.2 million,
compared to $3.7 million in the prior year quarter, and
adjusted EBITDA increased to $21.4 million, from $15.8 million.
- The increases were driven by $8.3 million of additional Net
Product Sales and the Company maintained its gross profit margin2
in the third quarter at 88% due to continued strong sales of
Indocin.
- Refinanced the Company’s 13.5% 2024 Senior Notes with a
$70.0 million 6.5% convertible notes offering that extends
debt maturity to 2027 and creates greater flexibility as the
Company seeks to further diversify the product portfolio.
- Cash at September 30, 2022 was $64.8 million, increased
from $52.3 million at June 30, inclusive of $10.0 million
in cash flow from operations during the third quarter.
- Announced an exclusive license for Sympazan® (clobazam) Oral
Film for an upfront payment of $9.0 million.
- On a full-year basis, Assertio estimates Sympazan would have
added $4.0 million to $4.5 million in adjusted EBITDA and an
additional $0.05 in adjusted EPS based on trailing 12 month net
sales of approximately $9.5 million.
- Received notice of allowance of a new Sympazan patent, and will
pay an additional $6 million in milestones in the fourth quarter.
When issued, this new patent will provide protection to 2039.
“Third quarter results demonstrated the value of our platform,
driving more than $21 million in adjusted EBITDA and $10 million in
cash flow from operations. In addition, our refinancing extends
maturity, significantly reduces our debt service cost and creates
greater operating flexibility as we continue to seek strategic
growth transactions that will further diversify our portfolio,”
said Dan Peisert, President and Chief Executive Officer of
Assertio. “Our recent Sympazan transaction exemplifies our goal of
acquiring assets that fit into our platform, are immediately
accretive, have long duration exclusivity and offer opportunities
for organic growth.”
“In addition to the attractive economics we can secure from
further acquisitions such as Sympazan, we continue to explore
larger transformative acquisition opportunities to accelerate our
goal to diversify our portfolio and take advantage of a favorable
M&A environment. With almost $65 million in cash on our balance
sheet at quarter end and continued positive cash flow, we are
fueled to execute on our strategic goals,” said Peisert.
Raises 2022 Financial GuidanceEffective
November 8, 2022, Assertio increased its outlook for the full year
2022 to now anticipate net product sales greater than $141 million,
and adjusted EBITDA greater than $86 million. The increased outlook
reflects higher than planned net product sales, continued operating
performance and the addition of $1 million (partial quarter) in
anticipated Sympazan sales.
|
Prior Guidance |
Current Guidance |
Net Product Sales (GAAP) |
$129.0 Million to $137.0 Million |
Greater than $141.0 Million |
Adjusted EBITDA (Non-GAAP)3 |
$73.0 Million to $79.0 Million |
Greater than $86.0 Million |
Balance Sheet and Cash Flow
For the quarter ended September 30, 2022 the company generated
$10.0 million in cash flow from operations, its sixth
consecutive quarter of positive cash flows. At quarter end, cash
and cash equivalents totaled $64.8 million.
During the third quarter, the company completed an offering of
$70.0 million aggregate principal amount of 6.5% convertible
senior notes due 2027. Assertio used proceeds from the offering to
fully redeem its $59.0 million 13% interest senior debt.
Conference Call and Investor Presentation
Information
Assertio’s management will host a conference call to discuss its
third quarter 2022 financial results today:
Date: |
November 8, 2022 |
Time: |
4:30 p.m. Eastern Time |
Webcast (live and archive): |
http://investor.assertiotx.com/overview/default.aspx (Events &
Webcasts, Investor Page) |
Dial-in numbers: |
1-929-526-1599 (domestic) |
Conference number: |
971287 |
To access the live webcast, the recorded conference call replay,
and other materials, please visit Assertio’s investor relations
website at http://investor.assertiotx.com/overview/default.aspx.
Please connect at least 15 minutes prior to the live webcast to
ensure adequate time for any software download that may be needed
to access the webcast. The replay will be available approximately
two hours after the call on Assertio’s investor website.
_______________1 Non-GAAP measures are reconciled to the
corresponding GAAP measures in the schedules attached. 2 Gross
profit margin represents the ratio of net products sales less cost
of sales to net product sales.3 See “Non-GAAP Financial Measures”
below for information about reconciling our Adjusted EBITDA
guidance to Net Income.
About Assertio
Assertio is a specialty pharmaceutical company offering
differentiated products to patients utilizing a non-personal
promotional model. We have built and continue to build our
commercial portfolio by identifying new opportunities within our
existing products as well as acquisitions or licensing of
additional approved products. To learn more about Assertio, visit
www.assertiotx.com.
Investor Contact
Matt KrepsManaging DirectorDarrow AssociatesAustin, TX M:
214-597-8200mkreps@darrowir.com
Forward Looking Statements
Statements in this communication that are not historical facts
are forward-looking statements that reflect Assertio's current
expectations, assumptions and estimates of future performance and
economic conditions. These forward-looking statements are made in
reliance on the safe harbor provisions of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. These forward-looking
statements relate to, among other things, future events or the
future performance or operations of Assertio, including our ability
to realize the benefits from our operating model, successfully
acquire and integrate new assets and explore new business
development initiatives. All statements other than historical facts
may be forward-looking statements and can be identified by words
such as "anticipate," "believe," "could," "design," "estimate,"
"expect," "forecast," "goal," "guidance," "imply," "intend," "may",
"objective," "opportunity," "outlook," "plan," "position,"
"potential," "predict," "project," "prospective," "pursue," "seek,"
"should," "strategy," "target," "would," "will," "aim" or other
similar expressions that convey the uncertainty of future events or
outcomes and are used to identify forward-looking statements. Such
forward-looking statements are not guarantees of future performance
and are subject to risks, uncertainties and other factors, some of
which are beyond the control of Assertio, including the risks
described in Assertio's Annual Report on Form 10-K and Quarterly
Reports on Form 10-Q filed with the U.S. Securities and Exchange
Commission ("SEC") and in other filings Assertio makes with the SEC
from time to time. Investors and potential investors are urged not
to place undue reliance on forward-looking statements in this
communication, which speak only as of this date. While Assertio may
elect to update these forward-looking statements at some point in
the future, it specifically disclaims any obligation to update or
revise any forward-looking-statements contained in this press
release whether as a result of new information or future events,
except as may be required by applicable law. Nothing contained
herein constitutes or will be deemed to constitute a forecast,
projection or estimate of the future financial performance or
expected results of Assertio.
Non-GAAP Financial Measures
To supplement the Company’s financial results presented on a
U.S. generally accepted accounting principles (GAAP) basis, the
Company has included information about non-GAAP measures of EBITDA,
adjusted EBITDA, adjusted earnings, and adjusted earnings per share
as useful operating metrics. The Company believes that the
presentation of these non-GAAP financial measures, when viewed with
results under GAAP and the accompanying reconciliation, provides
supplementary information to analysts, investors, lenders, and the
Company’s management in assessing the Company’s performance and
results from period to period. The Company uses these non-GAAP
measures internally to understand, manage and evaluate the
Company’s performance, and in part, in the determination of bonuses
for executive officers and employees. These non-GAAP financial
measures should be considered in addition to, and not a substitute
for, or superior to, net income or other financial measures
calculated in accordance with GAAP. Non-GAAP financial measures
used by us may be calculated differently from, and therefore may
not be comparable to, non-GAAP measures used by other
companies.
This release also includes estimated full-year non-GAAP adjusted
EBITDA information, which the Company believes enables investors to
better understand the anticipated performance of the business, but
should be considered a supplement to, and not as a substitute for
or superior to, financial measures calculated in accordance with
GAAP. No reconciliation of estimated non-GAAP adjusted EBITDA to
estimated net income is provided in this release because some of
the information necessary for estimated net income such as income
taxes, fair value change in contingent consideration, and
stock-based compensation is not yet ascertainable or accessible and
the Company is unable to quantify these amounts that would be
required to be included in estimated net income without
unreasonable efforts.
Specified Items
Non-GAAP measures presented within this release exclude
specified items. The Company considers specified items to be
significant income/expense items not indicative of current
operations. Specified items include adjustments to interest
expense, income tax expense (benefit), depreciation expense,
amortization expense, sales reserves adjustments for products the
Company is no longer selling, stock-based compensation expense,
fair value adjustments to contingent consideration, restructuring
costs, amortization of fair value inventory step-up as result of
purchase accounting, transaction-related costs, gains or losses
from adjustments to long-lived assets and assets not part of
current operations, and gains or losses resulting from debt
refinancing or extinguishment.
|
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE
INCOME(in thousands, except per share
amounts)(unaudited) |
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Revenues: |
|
|
|
|
|
|
|
Product sales, net |
$ |
34,279 |
|
|
$ |
25,997 |
|
|
$ |
105,258 |
|
|
$ |
77,271 |
|
Royalties and milestones |
|
473 |
|
|
|
416 |
|
|
|
1,916 |
|
|
|
1,391 |
|
Other revenue |
|
(540 |
) |
|
|
(941 |
) |
|
|
(1,290 |
) |
|
|
(976 |
) |
Total revenues |
|
34,212 |
|
|
|
25,472 |
|
|
|
105,884 |
|
|
|
77,686 |
|
Costs and expenses: |
|
|
|
|
|
|
|
Cost of sales |
|
4,009 |
|
|
|
3,050 |
|
|
|
12,734 |
|
|
|
10,936 |
|
Selling, general and administrative expenses |
|
11,900 |
|
|
|
9,013 |
|
|
|
33,084 |
|
|
|
41,377 |
|
Fair value of contingent consideration |
|
3,900 |
|
|
|
300 |
|
|
|
6,845 |
|
|
|
1,902 |
|
Amortization of intangible assets |
|
7,969 |
|
|
|
7,175 |
|
|
|
24,438 |
|
|
|
20,939 |
|
Restructuring charges |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,089 |
|
Total costs and expenses |
|
27,778 |
|
|
|
19,538 |
|
|
|
77,101 |
|
|
|
76,243 |
|
Income from operations |
|
6,434 |
|
|
|
5,934 |
|
|
|
28,783 |
|
|
|
1,443 |
|
Other (expense) income: |
|
|
|
|
|
|
|
Interest expense |
|
(2,052 |
) |
|
|
(2,495 |
) |
|
|
(6,648 |
) |
|
|
(7,783 |
) |
Other gain |
|
2 |
|
|
|
344 |
|
|
|
453 |
|
|
|
747 |
|
Total other expense |
|
(2,050 |
) |
|
|
(2,151 |
) |
|
|
(6,195 |
) |
|
|
(7,036 |
) |
Net income (loss) before
income taxes |
|
4,384 |
|
|
|
3,783 |
|
|
|
22,588 |
|
|
|
(5,593 |
) |
Income tax expense |
|
(210 |
) |
|
|
(46 |
) |
|
|
(1,516 |
) |
|
|
(294 |
) |
Net income (loss) and
comprehensive income (loss) |
$ |
4,174 |
|
|
$ |
3,737 |
|
|
$ |
21,072 |
|
|
$ |
(5,887 |
) |
|
|
|
|
|
|
|
|
Basic net income (loss) per
share |
$ |
0.09 |
|
|
$ |
0.08 |
|
|
$ |
0.45 |
|
|
$ |
(0.14 |
) |
Diluted net income (loss) per
share |
$ |
0.08 |
|
|
$ |
0.08 |
|
|
$ |
0.42 |
|
|
$ |
(0.14 |
) |
Shares used in computing basic
net income (loss) per share |
|
48,180 |
|
|
|
44,969 |
|
|
|
46,566 |
|
|
|
42,550 |
|
Shares used in computing
diluted net income (loss) per share |
|
57,386 |
|
|
|
45,055 |
|
|
|
50,470 |
|
|
|
42,550 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED BALANCE SHEETS(in
thousands, except share and per share
data)(unaudited) |
|
|
September 30,2022 |
|
December 31,2021 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
64,826 |
|
|
$ |
36,810 |
|
Accounts receivable, net |
|
44,680 |
|
|
|
44,361 |
|
Inventories, net |
|
14,268 |
|
|
|
7,489 |
|
Prepaid and other current assets |
|
2,720 |
|
|
|
14,838 |
|
Total current assets |
|
126,494 |
|
|
|
103,498 |
|
Property and equipment,
net |
|
935 |
|
|
|
1,527 |
|
Intangible assets, net |
|
191,617 |
|
|
|
216,054 |
|
Other long-term assets |
|
4,298 |
|
|
|
5,468 |
|
Total assets |
$ |
323,344 |
|
|
$ |
326,547 |
|
LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
8,374 |
|
|
$ |
6,685 |
|
Accrued rebates, returns and discounts |
|
48,608 |
|
|
|
52,662 |
|
Accrued liabilities |
|
10,992 |
|
|
|
14,699 |
|
Long-term debt, current portion |
|
2,175 |
|
|
|
12,174 |
|
Contingent consideration, current portion |
|
10,900 |
|
|
|
14,500 |
|
Other current liabilities |
|
11,247 |
|
|
|
34,299 |
|
Total current liabilities |
|
92,296 |
|
|
|
135,019 |
|
Long-term debt |
|
65,982 |
|
|
|
61,319 |
|
Contingent consideration |
|
25,759 |
|
|
|
23,159 |
|
Other long-term
liabilities |
|
4,392 |
|
|
|
4,636 |
|
Total liabilities |
|
188,429 |
|
|
|
224,133 |
|
Shareholders’ equity: |
|
|
|
Common stock, $0.0001 par value, 200,000,000 shares
authorized;48,196,618 and 44,640,444 shares issued and outstanding
as ofSeptember 30, 2022 and December 31, 2021,
respectively. |
|
5 |
|
|
|
4 |
|
Additional paid-in capital |
|
543,064 |
|
|
|
531,636 |
|
Accumulated deficit |
|
(408,154 |
) |
|
|
(429,226 |
) |
Total shareholders’ equity |
|
134,915 |
|
|
|
102,414 |
|
Total liabilities and
shareholders' equity |
$ |
323,344 |
|
|
$ |
326,547 |
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(in
thousands)(unaudited) |
|
|
Nine Months Ended September 30, |
|
|
2022 |
|
|
|
2021 |
|
Operating
Activities |
|
|
|
Net income (loss) |
$ |
21,072 |
|
|
|
(5,887 |
) |
Adjustments to reconcile net
income to net cash provided by (used in) operating activities: |
|
|
|
Depreciation and amortization |
|
25,033 |
|
|
|
21,698 |
|
Amortization of royalty rights |
|
128 |
|
|
|
159 |
|
Provision for inventory and other assets |
|
828 |
|
|
|
(86 |
) |
Stock-based compensation |
|
5,116 |
|
|
|
2,596 |
|
Recurring fair value measurement of assets and liabilities |
|
6,845 |
|
|
|
1,902 |
|
Changes in assets and
liabilities, net of acquisition: |
|
|
|
Accounts receivable |
|
(319 |
) |
|
|
8,205 |
|
Inventories |
|
(7,607 |
) |
|
|
6,317 |
|
Prepaid and other assets |
|
13,288 |
|
|
|
5,777 |
|
Accounts payable and other accrued liabilities |
|
(7,193 |
) |
|
|
(22,405 |
) |
Accrued rebates, returns and discounts |
|
(4,058 |
) |
|
|
(19,284 |
) |
Interest payable |
|
(1,232 |
) |
|
|
2,400 |
|
Net cash provided by operating activities |
|
51,901 |
|
|
|
1,392 |
|
Investing
Activities |
|
|
|
Purchase of Otrexup |
|
(16,889 |
) |
|
|
— |
|
Net cash used in investing activities |
|
(16,889 |
) |
|
|
— |
|
Financing
Activities |
|
|
|
Proceeds from issuance of 2027
Convertible Notes |
|
65,916 |
|
|
|
— |
|
Payments in connection with
2021 Convertible Notes |
|
— |
|
|
|
(335 |
) |
Payment in connection with
2024 Senior Notes |
|
(70,750 |
) |
|
|
(4,750 |
) |
Payment of contingent
consideration |
|
(7,845 |
) |
|
|
(2,495 |
) |
Payment of Royalty Rights |
|
(630 |
) |
|
|
(510 |
) |
Proceeds from issuance of
common stock |
|
7,020 |
|
|
|
44,861 |
|
Proceeds from exercise of
stock options |
|
— |
|
|
|
193 |
|
Shares withheld for payment of
employee's withholding tax liability |
|
(707 |
) |
|
|
(416 |
) |
Net cash (used in) provided by financing activities |
|
(6,996 |
) |
|
|
36,548 |
|
Net increase in cash and cash
equivalents |
|
28,016 |
|
|
|
37,940 |
|
Cash and cash equivalents at
beginning of year |
|
36,810 |
|
|
|
20,786 |
|
Cash and cash equivalents at
end of period |
$ |
64,826 |
|
|
$ |
58,726 |
|
Supplemental
Disclosure of Cash Flow Information |
|
|
|
Net cash refunded for income taxes |
$ |
(7,822 |
) |
|
$ |
— |
|
Cash paid for interest |
$ |
7,752 |
|
|
$ |
5,216 |
|
|
|
|
|
|
|
|
|
RECONCILIATION OF GAAP NET INCOME TO NON-GAAP EBITDA and
ADJUSTED EBITDA (in
thousands)(unaudited) |
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
Financial Statement Classification |
GAAP Net
Income/(Loss) |
|
$ |
4,174 |
|
$ |
3,737 |
|
$ |
21,072 |
|
$ |
(5,887 |
) |
|
|
Interest expense |
|
|
2,052 |
|
|
2,495 |
|
|
6,648 |
|
|
7,783 |
|
|
Interest expense |
Income tax expense |
|
|
210 |
|
|
46 |
|
|
1,516 |
|
|
294 |
|
|
Income tax expense |
Depreciation expense |
|
|
197 |
|
|
236 |
|
|
592 |
|
|
758 |
|
|
Selling, general and
administrative expenses |
Amortization of intangible assets |
|
|
7,969 |
|
|
7,175 |
|
|
24,438 |
|
|
20,939 |
|
|
Amortization of intangible
assets |
EBITDA
(Non-GAAP) |
|
$ |
14,602 |
|
$ |
13,689 |
|
|
54,266 |
|
|
23,887 |
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
Legacy products revenue reserves(1) |
|
|
540 |
|
|
941 |
|
|
1,290 |
|
|
976 |
|
|
Other revenue |
Stock-based compensation |
|
|
2,400 |
|
|
866 |
|
|
5,116 |
|
|
2,596 |
|
|
Selling, general and
administrative expenses |
Contingent consideration fair value change(2) |
|
|
3,900 |
|
|
300 |
|
|
6,845 |
|
|
1,902 |
|
|
Fair value of contingent
consideration |
Restructuring charges |
|
|
— |
|
|
— |
|
|
— |
|
|
1,089 |
|
|
Restructuring charges |
Other(3) |
|
|
— |
|
|
— |
|
|
700 |
|
|
554 |
|
|
Multiple |
Adjusted EBITDA
(Non-GAAP) |
|
$ |
21,442 |
|
$ |
15,796 |
|
|
68,217 |
|
|
31,004 |
|
|
|
(1) |
Represents
removal of the impact of revenue adjustment to reserves for product
sales allowances (gross-to-net sales allowances) estimates related
to previously divested products. |
|
|
(2) |
The fair value of the contingent consideration is remeasured
each reporting period, with the change in the fair value resulting
from changes in the underlying inputs being recognized as operating
expenses until the contingent consideration arrangement is
settled. |
|
|
(3) |
Other represents amortization of inventory step-up recognized
in Cost of sales related acquired inventories sold. |
RECONCILIATION OF GAAP NET INCOME and GAAP NET INCOME PER
SHARE TO NON-GAAP ADJUSTED EARNINGS and ADJUSTED
EARNINGS PER SHARE (1)(in
thousands, except per share
amounts)(unaudited) |
|
|
|
|
|
Three Months Ended September 30, 2022 |
|
Three Months Ended September 30, 2021 |
|
Amount |
|
Diluted EPS(4) |
|
Amount |
|
Diluted EPS |
Net income per share (GAAP) |
4,174 |
|
|
0.07 |
|
|
3,737 |
|
|
0.08 |
|
Add: Interest Expense on
convertible debt, net of tax(4) |
497 |
|
|
0.01 |
|
|
— |
|
|
— |
|
Adjustments |
|
|
|
|
|
|
|
Amortization of intangible assets |
7,969 |
|
|
0.14 |
|
|
7,175 |
|
|
0.16 |
|
Legacy products revenue reserves |
540 |
|
|
0.01 |
|
|
941 |
|
|
0.02 |
|
Stock-based compensation |
2,400 |
|
|
0.04 |
|
|
866 |
|
|
0.02 |
|
Contingent consideration fair value change |
3,900 |
|
|
0.07 |
|
|
300 |
|
|
0.01 |
|
Restructuring charges |
— |
|
|
— |
|
|
— |
|
|
— |
|
Other |
— |
|
|
— |
|
|
— |
|
|
— |
|
Contingent consideration cash payable(2) |
(4,374 |
) |
|
(0.07 |
) |
|
(2,908 |
) |
|
(0.06 |
) |
Income taxes expense, as adjusted(3) |
(2,609 |
) |
|
(0.05 |
) |
|
(1,594 |
) |
|
(0.04 |
) |
Adjusted earnings
(Non-GAAP) |
12,497 |
|
|
0.22 |
|
|
8,517 |
|
|
0.19 |
|
|
|
|
|
|
|
|
|
Diluted shares used in
calculation(4) |
57,386 |
|
|
|
|
45,055 |
|
|
|
Dilution effect of 2027
Convertible Notes(4) |
7,246 |
|
|
|
|
— |
|
|
|
(1) |
Represents per
share calculations of adjustments reflected in the Company’s
reconciliation of GAAP net income to non-GAAP adjusted EBITDA and
therefore should be read in conjunction with that reconciliation
and respective footnotes. |
|
|
(2) |
Represents the accrued cash payable of the INDOCIN contingent
consideration for the respective period based on 20% royalty for
annual INDOCIN net sales over $20.0 million. |
|
|
(3) |
Represents the Company’s income tax expense adjusted for the
tax effect of pre-tax adjustments excluded from adjusted earnings.
The tax effect of pre-tax adjustments excluded from adjusted
earnings is computed at the blended federal and state statutory
rate of 25%. |
|
|
(4) |
The Company uses the if-converted method to compute adjusted
diluted earnings per share with respect to its convertible debt.
Under the if-converted method, the Company assumes the 2027
Convertible Notes were converted at the beginning of each period
presented. As a result, interest expense and any adjustments
recognized in net income for the 2027 Convertible Notes is added
back to net income used in the diluted earnings per share
calculation. Additionally, the diluted shares used in the diluted
earnings per share calculation includes the dilution effect of the
2027 Convertible Notes. |
|
RECONCILIATION OF GAAP NET INCOME and GAAP NET INCOME PER
SHARE TONON-GAAP ADJUSTED EARNINGS and ADJUSTED
EARNINGS PER SHARE(1)(in
thousands, except per share
amounts)(unaudited) |
|
|
|
|
|
Nine Months Ended September 30, 2022 |
|
Nine Months Ended September 30, 2021 |
|
Amount |
|
Diluted EPS(4) |
|
Amount |
|
Diluted EPS |
Diluted net income (loss) per share (GAAP) |
21,072 |
|
|
0.42 |
|
|
(5,887 |
) |
|
(0.14 |
) |
Add: Interest Expense on
convertible debt, net of tax(4) |
487 |
|
|
0.01 |
|
|
— |
|
|
— |
|
Adjustments |
|
|
|
|
|
|
|
Amortization of intangible assets |
24,438 |
|
|
0.48 |
|
|
20,939 |
|
|
0.49 |
|
Legacy products revenue reserves |
1,290 |
|
|
0.03 |
|
|
976 |
|
|
0.02 |
|
Stock-based compensation |
5,116 |
|
|
0.10 |
|
|
2,596 |
|
|
0.06 |
|
Contingent consideration fair value change |
6,845 |
|
|
0.14 |
|
|
1,902 |
|
|
0.04 |
|
Restructuring charges |
— |
|
|
— |
|
|
1,089 |
|
|
0.03 |
|
Other |
700 |
|
|
0.01 |
|
|
554 |
|
|
0.01 |
|
Contingent consideration cash payable(2) |
(9,213 |
) |
|
(0.18 |
) |
|
(4,443 |
) |
|
(0.10 |
) |
Income taxes expense, as adjusted(3) |
(7,294 |
) |
|
(0.14 |
) |
|
(5,903 |
) |
|
(0.14 |
) |
Adjusted earnings
(Non-GAAP) |
43,441 |
|
|
0.85 |
|
|
11,823 |
|
|
0.27 |
|
|
|
|
|
|
|
|
|
Diluted shares used in
calculation(4) |
50,470 |
|
|
|
|
42,550 |
|
|
|
Dilution effect of 2027
Convertible Notes(4) |
2,442 |
|
|
|
|
|
|
|
(1) |
Represents per
share calculations of adjustments reflected in the Company’s
reconciliation of GAAP net income to non-GAAP adjusted EBITDA and
therefore should be read in conjunction with that reconciliation
and respective footnotes. |
|
|
(2) |
Represents the accrued cash payable of the INDOCIN contingent
consideration for the respective period based on 20% royalty for
annual INDOCIN net sales over $20.0 million. |
|
|
(3) |
Represents the Company’s income tax expense adjusted for the
tax effect of pre-tax adjustments excluded from adjusted earnings.
The tax effect of pre-tax adjustments excluded from adjusted
earnings is computed at the blended federal and state statutory
rate of 25%. |
|
|
(4) |
The Company uses the if-converted method to compute adjusted
diluted earnings per share with respect to its convertible debt.
Under the if-converted method, the Company assumes the 2027
Convertible Notes were converted at the beginning of each period
presented. As a result, interest expense and any adjustments
recognized in net income for the 2027 Convertible Notes is added
back to net income used in the diluted earnings per share
calculation. Additionally, the diluted shares used in the diluted
earnings per share calculation includes the dilution effect of the
2027 Convertible Notes. |
|
|
Assertio (NASDAQ:ASRT)
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