Endo Reports Fourth-Quarter And Full-Year 2019 Financial Results

February 26, 2020

— Strong Operational Performance Led by Year-over-Year Double-Digit-Percentage Revenue Growth in Sterile Injectables Segment and in Specialty Products Portfolio of Branded Pharmaceuticals Segment —

— Full-Year 2020 Financial Guidance Provided for Revenue, Adjusted Diluted Net Income per Share from Continuing Operations and Adjusted EBITDA —

DUBLIN, Feb. 26, 2020 /PRNewswire/ -- Endo International plc (NASDAQ: ENDP) today reported financial results for the fourth quarter and full year ended December 31, 2019.

Total revenues during the fourth quarter of 2019 were $765 million, a decrease of 3% compared to fourth-quarter 2018 revenues of $786 million.
Revenues of the Specialty Products portfolio of Branded Pharmaceuticals segment increased 15% in the fourth quarter of 2019 to $149 million compared to fourth-quarter 2018 revenues of $130 million.
Revenues of the Sterile Injectables segment increased 10% in the fourth quarter of 2019 to $285 million compared to fourth-quarter 2018 revenues of $259 million.

FINANCIAL PERFORMANCE
(in thousands, except per share amounts)

	Three months ended December 31,						Year ended December 31,
	2019		2018		Change		2019		2018		Change
Total Revenues, Net	$	764,800	$	786,389	(3)	%	$	2,914,364	$	2,947,078	(1)	%
Reported Loss from Continuing Operations	$	(208,489)	$	(265,479)	(21)	%	$	(360,584)	$	(961,767)	(63)	%
Reported Diluted Weighted Average Shares	226,787		224,353		1	%	226,050		223,960		1	%
Reported Diluted Net Loss per Share from Continuing Operations	$	(0.92)	$	(1.18)	(22)	%	$	(1.60)	$	(4.29)	(63)	%
Reported Net Loss	$	(218,643)	$	(291,908)	(25)	%	$	(422,636)	$	(1,031,469)	(59)	%
Adjusted Income from Continuing Operations	$	170,907	$	175,383	(3)	%	$	551,524	$	663,206	(17)	%
Adjusted Diluted Weighted Average Shares (1)	231,571		232,958		(1)	%	231,706		229,386		1	%
Adjusted Diluted Net Income per Share from Continuing Operations	$	0.74	$	0.75	(1)	%	$	2.38	$	2.89	(18)	%
Adjusted EBITDA	$	346,283	$	344,185	1	%	$	1,308,890	$	1,357,061	(4)	%

__________

(1)

Reported Diluted Net Loss per Share from continuing operations is computed based on weighted average shares outstanding and, if there is income from continuing operations during the period, the dilutive impact of ordinary share equivalents outstanding during the period. In the case of Adjusted Diluted Weighted Average Shares, Adjusted Income from Continuing Operations is used in determining whether to include such dilutive impact.

"In 2019, Endo delivered stronger than expected performance during the fourth quarter and for the full year, driven by continued double-digit percentage revenue growth in our Sterile Injectables segment and in the Specialty Products Portfolio of our Branded Pharmaceuticals segment, and as a result of our dedication to operational execution," said Paul Campanelli, Chairman, President and Chief Executive Officer at Endo. "For the full year, our Sterile Injectables segment exceeded $1 billion in revenue and our Specialty Products Portfolio exceeded $500 million in revenue, demonstrating progress on our strategic priority of expanding and investing in these businesses. Additionally, during the fourth quarter, the U.S. FDA accepted our original Biologics License Application for our CCH for Cellulite product and we launched five products."

"Looking ahead to 2020, Endo intends to build upon the success of the past year. We are focused on continuing to invest in our core areas of growth as part of our multi-year strategic plan, while being responsive to the current external environment under the leadership of Blaise Coleman, Endo's new President and Chief Executive Officer."

CONSOLIDATED RESULTS

Total revenues were $765 million in fourth-quarter 2019 compared to $786 million during the same period in 2018. This decrease was primarily attributable to competitive pressures in the Generic Pharmaceuticals segment and the Established Products portfolio of the Branded Pharmaceuticals segment, partially offset by continued strong growth in the Sterile Injectables segment and the Specialty Products portfolio of the Branded Pharmaceuticals segment.

Reported loss from continuing operations in fourth-quarter 2019 was $208 million compared to reported loss from continuing operations of $265 million during the same period in 2018. This result was primarily attributable to a decrease in asset impairment charges. Reported diluted net loss per share from continuing operations in fourth-quarter 2019 was $0.92 compared to reported diluted net loss per share from continuing operations of $1.18 in fourth-quarter 2018.

Adjusted income from continuing operations in fourth-quarter 2019 was $171 million compared to $175 million in fourth-quarter 2018. This decrease was primarily attributable to lower adjusted gross margin due to lower sales. Adjusted diluted net income per share from continuing operations in fourth-quarter 2019 was $0.74 compared to $0.75 in fourth-quarter 2018.

BRANDED PHARMACEUTICALS

Fourth-quarter 2019 Branded Pharmaceuticals revenues were $226 million compared to $230 million in fourth-quarter 2018. This decrease was primarily attributable to ongoing generic competition in the Established Products portfolio, offset by continued strong growth in the Specialty Products portfolio.

Specialty Products revenues increased 15% to $149 million in fourth-quarter 2019 compared to $130 million in fourth-quarter 2018, primarily driven by the continued strong performance of XIAFLEX^®. Sales of XIAFLEX^® increased 27% to $102 million compared to $80 million in fourth-quarter 2018, primarily attributable to demand growth in both the Peyronie's Disease and Dupuytren's Contracture indications driven by continued commercial execution and investment in promotional activities.

In November 2019, the U.S. Food and Drug Administration accepted the Company's original Biologics License Application (BLA) for its Collagenase Clostridium Histolyticum (CCH) product for the treatment of cellulite in the buttocks. The Prescription Drug User Fee Act (PDUFA), or target action date for the BLA, has been set for July 6, 2020.

STERILE INJECTABLES

Fourth-quarter 2019 Sterile Injectables revenues were $285 million, an increase of 10% compared to $259 million in fourth-quarter 2018. This increase reflects the continued strong growth of VASOSTRICT^® and ADRENALIN^®.

GENERIC PHARMACEUTICALS

Fourth-quarter 2019 Generic Pharmaceuticals revenues were $226 million, a decrease of 14% compared to $264 million in fourth-quarter 2018. This performance was primarily attributable to continued competitive pressure on commoditized generic products. Partially offsetting the decrease were the impacts of certain recent product launches. During fourth-quarter 2019, the Generic Pharmaceuticals segment launched five products.

INTERNATIONAL PHARMACEUTICALS

Fourth-quarter 2019 International Pharmaceuticals revenues were $29 million, a decrease of 16% compared to fourth-quarter 2018. This decrease was primarily due to ongoing generic competition.

2020 FINANCIAL GUIDANCE

Endo is providing guidance for the 12 months ending December 31, 2020, at current exchange rates, for revenue, adjusted diluted net income per share from continuing operations and adjusted EBITDA. The Company estimates:

Total revenues to be between $2.72 billion and $2.92 billion;
Adjusted diluted net income per share from continuing operations to be between $2.15 and $2.40; and
Adjusted EBITDA to be between $1.22 billion and $1.32 billion.

The Company's 2020 non-GAAP financial guidance is based on the following assumptions:

Adjusted gross margin of approximately 66.0% to 67.0%;
Adjusted operating expenses as a percentage of revenue to be approximately 25.0% to 25.5%;
Adjusted interest expense of approximately $535 to $545 million;
Adjusted effective tax rate of approximately 13.5% to 14.5%; and
Adjusted diluted weighted average shares outstanding of approximately 236 million.

Guidance for Adjusted diluted net income per share from continuing operations, Adjusted EBITDA and Adjusted operating expenses exclude opioid-related legal expenses.

BALANCE SHEET, LIQUIDITY AND OTHER UPDATES

As of December 31, 2019, the Company had approximately $1.5 billion in unrestricted cash; debt of $8.4 billion; net debt of approximately $6.9 billion and a net debt to adjusted EBITDA ratio of 5.3.

Fourth-quarter 2019 cash used in operating activities was $21 million, compared to $70 million of net cash provided by operating activities during fourth-quarter 2018.

CONFERENCE CALL INFORMATION

Endo will conduct a conference call with financial analysts to discuss this press release today at 8:00 a.m. ET. The dial-in number to access the call is U.S./Canada (866) 497-0462, International (678) 509-7598, and the passcode is 4777677. Please dial in 10 minutes prior to the scheduled start time.

A replay of the call will be available from February 26, 2020 at 11:00 a.m. ET until 11:00 a.m. ET on March 4, 2020 by dialing U.S./Canada (800) 585-8367, International (404) 537-3406, and entering the passcode 4777677.

A simultaneous webcast of the call can be accessed by visiting http://investor.endo.com/events-and-presentations. In addition, a replay of the webcast will be available on the Company website for one year following the event.

FINANCIAL SCHEDULES

The following table presents Endo's unaudited Total revenues, net for the three and twelve months ended December 31, 2019 and 2018 (dollars in thousands):

	Three months ended December 31,				Percent Growth		Year ended December 31,				Percent Growth
	2019		2018		Percent Growth		2019		2018		Percent Growth
Branded Pharmaceuticals:
Specialty Products:
XIAFLEX®	$	101,520	$	79,783	27	%	$	327,638	$	264,638	24	%
SUPPRELIN® LA	20,255		20,759		(2)	%	86,797		81,707		6	%
Other Specialty (1)	26,844		29,004		(7)	%	105,241		98,230		7	%
Total Specialty Products	$	148,619	$	129,546	15	%	$	519,676	$	444,575	17	%
Established Products:
PERCOCET®	$	27,813	$	29,362	(5)	%	$	116,012	$	122,901	(6)	%
TESTOPEL®	14,414		13,401		8	%	55,244		58,377		(5)	%
Other Established (2)	34,705		57,551		(40)	%	164,470		236,979		(31)	%
Total Established Products	$	76,932	$	100,314	(23)	%	$	335,726	$	418,257	(20)	%
Total Branded Pharmaceuticals (3)	$	225,551	$	229,860	(2)	%	$	855,402	$	862,832	(1)	%
Sterile Injectables:
VASOSTRICT®	$	146,883	$	121,380	21	%	$	531,737	$	453,767	17	%
ADRENALIN®	45,827		41,631		10	%	179,295		143,489		25	%
Ertapenem for injection	25,060		31,870		(21)	%	104,679		57,668		82	%
APLISOL®	5,830		15,849		(63)	%	61,826		64,913		(5)	%
Other Sterile Injectables (4)	61,568		47,989		28	%	185,594		209,729		(12)	%
Total Sterile Injectables (3)	$	285,168	$	258,719	10	%	$	1,063,131	$	929,566	14	%
Total Generic Pharmaceuticals	$	225,560	$	263,770	(14)	%	$	879,882	$	1,012,215	(13)	%
Total International Pharmaceuticals	$	28,521	$	34,040	(16)	%	$	115,949	$	142,465	(19)	%
Total revenues, net	$	764,800	$	786,389	(3)	%	$	2,914,364	$	2,947,078	(1)	%

__________
(1)	Products included within Other Specialty are NASCOBAL^®Nasal Spray and AVEED^®. Beginning with our first-quarter 2019 reporting, TESTOPEL^®, which was previously included in Other Specialty, has been reclassified and is now included in the Established Products portfolio for all periods presented.
(2)	Products included within Other Established include, but are not limited to, LIDODERM^®, EDEX^® and VOLTAREN^® Gel.
(3)	Individual products presented above represent the top two performing products in each product category for the year ended December 31, 2019 and/or any product having revenues in excess of $100 million during any of the years ended December 31, 2019, 2018 or 2017 or $25 million during any quarterly period in 2019 or 2018.
(4)	Products included within Other Sterile Injectables include ephedrine sulfate injection, treprostinil for injection and others.

The following table presents unaudited Condensed Consolidated Statement of Operations data for the three and twelve months ended December 31, 2019 and 2018 (in thousands, except per share data):

	Three months ended December 31,				Year ended December 31,
	2019		2018		2019		2018
TOTAL REVENUES, NET	$	764,800	$	786,389	$	2,914,364	$	2,947,078
COSTS AND EXPENSES:
Cost of revenues	400,056		433,214		1,569,338		1,631,682
Selling, general and administrative	160,671		167,422		632,420		646,037
Research and development	34,379		25,395		130,732		185,826
Litigation-related and other contingencies, net	15,304		(1,561)		11,211		13,809
Asset impairment charges	267,430		303,539		526,082		916,939
Acquisition-related and integration items, net	(19,115)		8,630		(46,098)		21,914
Interest expense, net	134,347		135,760		538,734		521,656
Gain on extinguishment of debt	—		—		(119,828)		—
Other (income) expense, net	(3,731)		(18,737)		16,677		(51,953)
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAX	$	(224,541)	$	(267,273)	$	(344,904)	$	(938,832)
INCOME TAX (BENEFIT) EXPENSE	(16,052)		(1,794)		15,680		22,935
LOSS FROM CONTINUING OPERATIONS	$	(208,489)	$	(265,479)	$	(360,584)	$	(961,767)
DISCONTINUED OPERATIONS, NET OF TAX	(10,154)		(26,429)		(62,052)		(69,702)
NET LOSS	$	(218,643)	$	(291,908)	$	(422,636)	$	(1,031,469)
NET LOSS PER SHARE—BASIC:
Continuing operations	$	(0.92)	$	(1.18)	$	(1.60)	$	(4.29)
Discontinued operations	(0.04)		(0.12)		(0.27)		(0.32)
Basic	$	(0.96)	$	(1.30)	$	(1.87)	$	(4.61)
NET LOSS PER SHARE—DILUTED:
Continuing operations	$	(0.92)	$	(1.18)	$	(1.60)	$	(4.29)
Discontinued operations	(0.04)		(0.12)		(0.27)		(0.32)
Diluted	$	(0.96)	$	(1.30)	$	(1.87)	$	(4.61)
WEIGHTED AVERAGE SHARES:
Basic	226,787		224,353		226,050		223,960
Diluted	226,787		224,353		226,050		223,960

The following table presents unaudited Condensed Consolidated Balance Sheet data at December 31, 2019 and December 31, 2018 (in thousands):

	December 31, 2019		December 31, 2018
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	1,454,531	$	1,149,113
Restricted cash and cash equivalents	247,457		305,368
Accounts receivable	467,953		470,570
Inventories, net	327,865		322,179
Other current assets	88,412		95,920
Total current assets	$	2,586,218	$	2,343,150
TOTAL NON-CURRENT ASSETS	6,803,309		7,789,243
TOTAL ASSETS	$	9,389,527	$	10,132,393
LIABILITIES AND SHAREHOLDERS' DEFICIT
CURRENT LIABILITIES:
Accounts payable and accrued expenses, including legal settlement accruals	$	1,412,954	$	1,914,285
Other current liabilities	47,335		35,811
Total current liabilities	$	1,460,289	$	1,950,096
LONG-TERM DEBT, LESS CURRENT PORTION, NET	8,359,899		8,224,269
OTHER LIABILITIES	435,883		456,311
SHAREHOLDERS' DEFICIT	(866,544)		(498,283)
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT	$	9,389,527	$	10,132,393

The following table presents unaudited Condensed Consolidated Statement of Cash Flow data for the years ended December 31, 2019 and 2018 (in thousands):

	Year ended December 31,
	2019		2018
OPERATING ACTIVITIES:
Net loss	$	(422,636)	$	(1,031,469)
Adjustments to reconcile Net loss to Net cash provided by operating activities:
Depreciation and amortization	612,862		723,707
Asset impairment charges	526,082		916,939
Other, including cash payments to claimants from Qualified Settlement Funds	(618,256)		(341,907)
Net cash provided by operating activities	$	98,052	$	267,270
INVESTING ACTIVITIES:
Purchases of property, plant and equipment, excluding capitalized interest	$	(63,854)	$	(83,398)
Proceeds from sale of business and other assets, net	6,577		70,369
Other	(2,921)		(4,871)
Net cash used in investing activities	$	(60,198)	$	(17,900)
FINANCING ACTIVITIES:
Proceeds from (payments on) borrowings, net	$	237,989	$	(39,372)
Other	(33,388)		(42,200)
Net cash provided by (used in) financing activities	$	204,601	$	(81,572)
Effect of foreign exchange rate	1,096		(1,975)
NET INCREASE IN CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS	$	243,551	$	165,823
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS, BEGINNING OF PERIOD	1,476,837		1,311,014
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS, END OF PERIOD	$	1,720,388	$	1,476,837

SUPPLEMENTAL FINANCIAL INFORMATION

To supplement the financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), the Company uses certain non-GAAP financial measures. For additional information on the Company's use of such non-GAAP financial measures, refer to Endo's Current Report on Form 8-K furnished today to the U.S. Securities and Exchange Commission, which includes an explanation of the Company's reasons for using non-GAAP measures.

The tables below provide reconciliations of certain of our non-GAAP financial measures to their most directly comparable GAAP amounts. Refer to the "Notes to the Reconciliations of GAAP and Non-GAAP Financial Measures" section below for additional details regarding the adjustments to the non-GAAP financial measures detailed throughout this Supplemental Financial Information section.

Reconciliation of EBITDA and Adjusted EBITDA (non-GAAP)

The following table provides a reconciliation of Net loss (GAAP) to Adjusted EBITDA (non-GAAP) for the three and twelve months ended December 31, 2019 and 2018 (in thousands):

	Three months ended December 31,				Year ended December 31,
	2019		2018		2019		2018
Net loss (GAAP)	$	(218,643)	$	(291,908)	$	(422,636)	$	(1,031,469)
Income tax (benefit) expense	(16,052)		(1,794)		15,680		22,935
Interest expense, net	134,347		135,760		538,734		521,656
Depreciation and amortization (15)	144,453		167,205		612,862		688,530
EBITDA (non-GAAP)	$	44,105	$	9,263	$	744,640	$	201,652

Inventory step-up and other cost savings (2)	$	—	$	—	$	—	$	261
Upfront and milestone-related payments (3)	2,568		2,081		6,623		45,108
Inventory reserve increase from restructuring (4)	—		150		—		2,947
Retention and separation benefits and other restructuring (5)	19,426		4,004		34,598		83,348
Certain litigation-related and other contingencies, net (6)	15,304		(1,561)		11,211		13,809
Asset impairment charges (7)	267,430		303,539		526,082		916,939
Acquisition-related and integration costs (8)	—		451		—		2,004
Fair value of contingent consideration (9)	(19,115)		8,179		(46,098)		19,910
Gain on extinguishment of debt (10)	—		—		(119,828)		—
Share-based compensation	10,233		10,349		59,142		54,071
Other (income) expense, net (16)	(3,731)		(18,737)		16,677		(51,953)
Other adjustments	(91)		38		13,791		(737)
Discontinued operations, net of tax (13)	10,154		26,429		62,052		69,702
Adjusted EBITDA (non-GAAP)	$	346,283	$	344,185	$	1,308,890	$	1,357,061

Reconciliation of Adjusted Income from Continuing Operations (non-GAAP)

The following table provides a reconciliation of our Loss from continuing operations (GAAP) to our Adjusted income from continuing operations (non-GAAP) for the three and twelve months ended December 31, 2019 and 2018 (in thousands):

	Three months ended December 31,				Year ended December 31,
	2019		2018		2019		2018
Loss from continuing operations (GAAP)	$	(208,489)	$	(265,479)	$	(360,584)	$	(961,767)
Non-GAAP adjustments:
Amortization of intangible assets (1)	125,913		150,677		543,862		622,339
Inventory step-up and other cost savings (2)	—		—		—		261
Upfront and milestone-related payments (3)	2,568		2,081		6,623		45,108
Inventory reserve increase from restructuring (4)	—		150		—		2,947
Retention and separation benefits and other restructuring (5)	19,426		4,004		34,598		83,348
Certain litigation-related and other contingencies, net (6)	15,304		(1,561)		11,211		13,809
Asset impairment charges (7)	267,430		303,539		526,082		916,939
Acquisition-related and integration costs (8)	—		451		—		2,004
Fair value of contingent consideration (9)	(19,115)		8,179		(46,098)		19,910
Gain on extinguishment of debt (10)	—		—		(119,828)		—
Other (11)	(2,002)		(19,034)		28,252		(48,942)
Tax adjustments (12)	(30,128)		(7,624)		(72,594)		(32,750)
Adjusted income from continuing operations (non-GAAP)	$	170,907	$	175,383	$	551,524	$	663,206

Reconciliation of Other Adjusted Income Statement Data (non-GAAP)

The following tables provide detailed reconciliations of various other income statement data between the GAAP and non-GAAP amounts for the three and twelve months ended December 31, 2019 and 2018 (in thousands, except per share data):

	Three months ended December 31, 2019
	Total revenues, net	Cost of revenues	Gross margin	Gross margin %	Total operating expenses	Operating expense to revenue %	Operating (loss) income from continuing operations	Operating margin %	Other non-operating expense, net	(Loss) income from continuing operations before income tax	Income tax (benefit) expense	Effective tax rate	(Loss) income from continuing operations	Discontinued operations, net of tax	Net (loss) income	Diluted net (loss) income per share from continuing operations (14)
Reported (GAAP)	$ 764,800	$ 400,056	$ 364,744	47.7 %	$ 458,669	60.0 %	$ (93,925)	(12.3)%	$ 130,616	$ (224,541)	$ (16,052)	7.1 %	$ (208,489)	$ (10,154)	$ (218,643)	$ (0.92)
Items impacting comparability:
Amortization of intangible assets (1)	-	(125,913)	125,913		-		125,913		-	125,913	-		125,913	-	125,913
Upfront and milestone-related payments (3)	-	(542)	542		(2,026)		2,568		-	2,568	-		2,568	-	2,568
Retention and separation benefits and other restructuring (5)	-	(4,689)	4,689		(14,737)		19,426		-	19,426	-		19,426	-	19,426
Certain litigation-related and other contingencies, net (6)	-	-	-		(15,304)		15,304		-	15,304	-		15,304	-	15,304
Asset impairment charges (7)	-	-	-		(267,430)		267,430		-	267,430	-		267,430	-	267,430
Fair value of contingent consideration (9)	-	-	-		19,115		(19,115)		-	(19,115)	-		(19,115)	-	(19,115)
Other (11)	-	-	-		-		-		2,002	(2,002)	-		(2,002)	-	(2,002)
Tax adjustments (12)	-	-	-		-		-		-	-	30,128		(30,128)	-	(30,128)
Exclude discontinued operations, net of tax (13)	-	-	-		-		-		-	-	-		-	10,154	10,154
After considering items (non-GAAP)	$ 764,800	$ 268,912	$ 495,888	64.8 %	$ 178,287	23.3 %	$ 317,601	41.5 %	$ 132,618	$ 184,983	$ 14,076	7.6 %	$ 170,907	$ -	$ 170,907	$ 0.74

	Three months ended December 31, 2018
	Total revenues, net	Cost of revenues	Gross margin	Gross margin %	Total operating expenses	Operating expense to revenue %	Operating (loss) income from continuing operations	Operating margin %	Other non-operating expense, net	(Loss) income from continuing operations before income tax	Income tax (benefit) expense	Effective tax rate	(Loss) income from continuing operations	Discontinued operations, net of tax	Net (loss) income	Diluted net (loss) income per share from continuing operations (14)
Reported (GAAP)	$ 786,389	$ 433,214	$ 353,175	44.9 %	$ 503,425	64.0 %	$ (150,250)	(19.1)%	$ 117,023	$ (267,273)	$ (1,794)	0.7 %	$ (265,479)	$ (26,429)	$ (291,908)	$ (1.18)
Items impacting comparability:
Amortization of intangible assets (1)	-	(150,677)	150,677		-		150,677		-	150,677	-		150,677	-	150,677
Upfront and milestone-related payments (3)	-	(741)	741		(1,340)		2,081		-	2,081	-		2,081	-	2,081
Inventory reserve increase from restructuring (4)	-	(150)	150		-		150		-	150	-		150	-	150
Retention and separation benefits and other restructuring (5)	-	(30)	30		(3,974)		4,004		-	4,004	-		4,004	-	4,004
Certain litigation-related and other contingencies, net (6)	-	-	-		1,561		(1,561)		-	(1,561)	-		(1,561)	-	(1,561)
Asset impairment charges (7)	-	-	-		(303,539)		303,539		-	303,539	-		303,539	-	303,539
Acquisition-related and integration costs (8)	-	-	-		(451)		451		-	451	-		451	-	451
Fair value of contingent consideration (9)	-	-	-		(8,179)		8,179		-	8,179	-		8,179	-	8,179
Other (11)	-	-	-		-		-		19,034	(19,034)	-		(19,034)	-	(19,034)
Tax adjustments (12)	-	-	-		-		-		-	-	7,624		(7,624)	-	(7,624)
Exclude discontinued operations, net of tax (13)	-	-	-		-		-		-	-	-		-	26,429	26,429
After considering items (non-GAAP)	$ 786,389	$ 281,616	$ 504,773	64.2 %	$ 187,503	23.8 %	$ 317,270	40.3 %	$ 136,057	$ 181,213	$ 5,830	3.2 %	$ 175,383	$ -	$ 175,383	$ 0.75

	Year Ended December 31, 2019
	Total revenues, net	Cost of revenues	Gross margin	Gross margin %	Total operating expenses	Operating expense to revenue %	Operating income from continuing operations	Operating margin %	Other non-operating expense, net	(Loss) income from continuing operations before income tax	Income tax expense	Effective tax rate	(Loss) income from continuing operations	Discontinued operations, net of tax	Net (loss) income	Diluted net (loss) income per share from continuing operations (14)
Reported (GAAP)	$2,914,364	$ 1,569,338	$1,345,026	46.2 %	$ 1,254,347	43.0 %	$ 90,679	3.1 %	$ 435,583	$ (344,904)	$ 15,680	(4.5)%	$ (360,584)	$ (62,052)	$ (422,636)	$ (1.60)
Items impacting comparability:
Amortization of intangible assets (1)	-	(543,862)	543,862		-		543,862		-	543,862	-		543,862	-	543,862
Upfront and milestone-related payments (3)	-	(2,484)	2,484		(4,139)		6,623		-	6,623	-		6,623	-	6,623
Retention and separation benefits and other restructuring (5)	-	(5,693)	5,693		(28,905)		34,598		-	34,598	-		34,598	-	34,598
Certain litigation-related and other contingencies, net (6)	-	-	-		(11,211)		11,211		-	11,211	-		11,211	-	11,211
Asset impairment charges (7)	-	-	-		(526,082)		526,082		-	526,082	-		526,082	-	526,082
Fair value of contingent consideration (9)	-	-	-		46,098		(46,098)		-	(46,098)	-		(46,098)	-	(46,098)
Gain on extinguishment of debt (10)	-	-	-		-		-		119,828	(119,828)	-		(119,828)	-	(119,828)
Other (11)	-	-	-		(13,878)		13,878		(14,374)	28,252	-		28,252	-	28,252
Tax adjustments (12)	-	-	-		-		-		-	-	72,594		(72,594)	-	(72,594)
Exclude discontinued operations, net of tax (13)	-	-	-		-		-		-	-	-		-	62,052	62,052
After considering items (non-GAAP)	$2,914,364	$ 1,017,299	$1,897,065	65.1 %	$ 716,230	24.6 %	$1,180,835	40.5 %	$ 541,037	$ 639,798	$ 88,274	13.8 %	$ 551,524	$ -	$ 551,524	$ 2.38

	Year Ended December 31, 2018
	Total revenues, net	Cost of revenues	Gross margin	Gross margin %	Total operating expenses	Operating expense to revenue %	Operating (loss) income from continuing operations	Operating margin %	Other non-operating expense, net	(Loss) income from continuing operations before income tax	Income tax expense	Effective tax rate	(Loss) income from continuing operations	Discontinued operations, net of tax	Net (loss) income	Diluted net (loss) income per share from continuing operations (14)
Reported (GAAP)	$2,947,078	$ 1,631,682	$1,315,396	44.6 %	$ 1,784,525	60.6 %	$ (469,129)	(15.9)%	$ 469,703	$ (938,832)	$ 22,935	(2.4)%	$ (961,767)	$ (69,702)	$(1,031,469)	$ (4.29)
Items impacting comparability:
Amortization of intangible assets (1)	-	(622,339)	622,339		-		622,339		-	622,339	-		622,339	-	622,339
Inventory step-up and other cost savings (2)	-	(261)	261		-		261		-	261	-		261	-	261
Upfront and milestone-related payments (3)	-	(2,836)	2,836		(42,272)		45,108		-	45,108	-		45,108	-	45,108
Inventory reserve increase from restructuring (4)	-	(2,947)	2,947		-		2,947		-	2,947	-		2,947	-	2,947
Retention and separation benefits and other restructuring (5)	-	(57,487)	57,487		(25,861)		83,348		-	83,348	-		83,348	-	83,348
Certain litigation-related and other contingencies, net (6)	-	-	-		(13,809)		13,809		-	13,809	-		13,809	-	13,809
Asset impairment charges (7)	-	-	-		(916,939)		916,939		-	916,939	-		916,939	-	916,939
Acquisition-related and integration costs (8)	-	-	-		(2,004)		2,004		-	2,004	-		2,004	-	2,004
Fair value of contingent consideration (9)	-	-	-		(19,910)		19,910		-	19,910	-		19,910	-	19,910
Other (11)	-	-	-		630		(630)		48,312	(48,942)	-		(48,942)	-	(48,942)
Tax adjustments (12)	-	-	-		-		-		-	-	32,750		(32,750)	-	(32,750)
Exclude discontinued operations, net of tax (13)	-	-	-		-		-

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Endo Reports Fourth-Quarter And Full-Year 2019 Financial Results