2014

Endo Reports Second Quarter Financial Results and Updates 2012 Financial Guidance

CHADDS FORD, Pa., Aug 7, 2012  /PRNewswire/ --

  • Total quarterly revenues of $785 million, increased 29 percent versus prior year
  • Qualitest grows quarterly sales by 20 percent versus prior year
  • Commercial conversion of  OPANA® ER to new formulation designed to be crush-resistant  completed during second quarter
  • Company maintains adjusted diluted EPS in the range of $5.00 to $5.20; Now expects reported diluted (GAAP) EPS in the range of $1.07 to $1.27
  • Company now expects revenues of $3.05 to $3.175 billion in 2012

Endo Health Solutions (Nasdaq: ENDP) today reported a 29 percent increase in total revenues during the second quarter of 2012 to $785 million, compared with $608 million in the same quarter of 2011, reflecting organic growth and the acquisition of American Medical Systems (AMS) in June 2011.  Net income for the three months ended June 30, 2012, was $9 million, compared with net income of $55 million reported in the comparable 2011 period.  Reported net income includes the effect of a non-cash, pre-tax charge of $131 million for the period to reflect the estimated fair value of the settlement component of Endo's 2012 settlement and license agreement with Watson Pharmaceuticals (Watson), which settled all ongoing patent litigation among the parties relating to Watson's generic version of LIDODERM® (lidocaine patch 5%).   

As detailed in the supplemental financial information below, adjusted net income for the three months ended June 30, 2012, was $154 million, compared with $129 million in the same period in 2011.  Reported diluted earnings per share for the quarter ended June 30, 2012 were $0.08, compared with $0.44 in the second quarter of 2011.  Adjusted diluted earnings per share for the same period were $1.27 compared with $1.05 reported in 2011.

"Endo had a strong second quarter, as our diversified business produced the opportunities needed to deliver better than expected earnings per share," said Dave Holveck, president and CEO of Endo. "I remain very positive about the growth prospects across the board.  More importantly, I am proud of the introduction and receptivity of the new formulation of OPANA ER, which is designed to be crush resistant, as a positive step in the battle against inappropriate use.  Endo has been a long-time responsible partner in the pain management space, and we believe the reformulated OPANA ER is an important step in supporting appropriate use of the product."

FINANCIAL PERFORMANCE AT A GLANCE

















($ in thousands, except per share amounts)













2nd Quarter




Six Months Ended June 30,




2012


2011


Change


2012


2011


Change

Total Revenues

$

785,188



$

607,611



29

%


$

1,475,821



$

1,167,637



26

%

Reported Net Income

$

9,465



$

54,583



(83)

%


$

(77,880)



$

110,370



NM

Reported Diluted EPS

$

0.08



$

0.44



(82)

%


$

(0.67)



$

0.91



NM

Adjusted Net Income

$

154,153



$

128,700



20

%


$

260,453



$

248,878



5

%

Adjusted Diluted EPS

$

1.27



$

1.05



21

%


$

2.14



$

2.04



5

%

ENDO PHARMACEUTICALS
Branded pharmaceutical sales of $443 million for the second quarter represented an increase of 11 percent versus the prior year.  

Net sales of LIDODERM increased 16 percent on 2 percent prescription growth.  The increase in LIDODERM net sales is primarily a result of changes from November 2011, with respect to royalty obligations among Endo, Hind Healthcare Inc., and Teikoku Seiyaku Co. Ltd.; changes that have been previously described in our filings with the U.S. Securities and Exchange Commission.

During second quarter 2012, Endo announced that it had reached an agreement with Watson resolving two patent infringement lawsuits related to LIDODERM. The agreement resolved the inherent uncertainties of this litigation and reflects the uncertainty created by the regulatory challenges facing generic manufacturers seeking to market a generic version of LIDODERM. 

In addition, in March 2012, Endo submitted an amended Citizen Petition (CP) highlighting the scientific and regulatory support for requiring generic manufacturers to conduct comparative clinical endpoint studies to demonstrate bioequivalence to locally acting topical products like LIDODERM. The CP, which can be found at www.endo.com/investors/overview, is currently under review by the U.S. Food and Drug Administration (FDA), and the company continues to believe in the merits of the arguments set forth in the CP. 

During the second quarter of 2012, Endo announced the completion of the company's transition of its OPANA ER franchise to the new formulation designed to be crush-resistant.  In connection with the completion of this transition, the FDA moved all the strengths of the old formulation of OPANA ER to the Orange Book Discontinued List.  The result is that the new formulation designed to be crush-resistant (under NDA 201655) remains on the approved prescription drug product list and is the only commercially available formulation of OPANA ER.

QUALITEST
Generic product sales of $160 million for the second quarter 2012 represented an increase of 20 percent over the same period last year.  The increase was driven by strong demand for Qualitest's diversified product portfolio and favorable pricing, resulting in gross profit of approximately 40 percent.  Strong net sales growth is expected for Qualitest for the remainder of 2012.  Sales growth is expected to be driven by strong demand for its commercial products and a stable pricing environment.  Qualitest remains focused on process improvements and increased efficiencies in order to enhance manufacturing capacity.

In July, Qualitest announced that it had received FDA approval for its Abbreviated New Drug Application (ANDA) for Levetiracetam extended-release tablets, 500mg and 750mg, the generic equivalent of UCB's Keppra XR®.  Additionally, on Aug. 6, the company announced its launch of a generic version of Singulair® (montelukast sodium) Tablets and Chewable Tablets.  Total combined branded sales for Montelukast Sodium Tablets and Chewables in the U.S. for the 12 months ending June 30, 2012 were approximately $4.9 billion, according to IMS Health.        

AMS
Devices sales, driven by the June 2011 acquisition of AMS, were $128 million for the second quarter.  Men's Health, led by sales of the AMS 800® Artificial Urinary Sphincter, increased 40 percent on a pro forma basis in the second quarter of 2012, compared with same period last year. The sales growth rate for the period primarily benefits from the temporary withdrawal of the AMS 800 Artificial Urinary Sphincter from the market during second quarter 2011. Benign prostatic hyperplasia (BPH), although led by the increasing share of procedural volumes for the GreenLight XPS console and the accompanying MoXy fiber, decreased 4 percent on a pro forma basis in the second quarter of 2012.  Women's Health sales decreased 30 percent on a pro forma basis in the second quarter of 2012, compared with same period last year.  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 advisory committee meeting regarding the use of surgical mesh.  AMS remains focused on physician and patient education activities as part of an overall effort to continue to encourage physicians and patients to discuss the risks and benefits of the company'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 $54 million for the second quarter 2012 represented an increase of 10 percent over last year.  Second quarter growth for HealthTronics was driven by the increasing sales of lab services and the strategic addition of its electronic medical records offering.  The company expects improved top-line growth from the Services segment in 2012 and beyond from the recent addition of its electronic medical records offering that is focused on practices specializing in urology and an expanding set of partnerships in its Endocare® cryoablation therapy business.

2012 Financial Guidance
Endo's estimates are based on actual results for the six months ended June 30, 2012 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 the potential future changes in the fair value of contingent consideration or for potential new corporate development transactions.  For the full year ended Dec 31, 2012 Endo estimates:

  • Total revenue to be between $3.05 billion and $3.175 billion
  • Total Endo Pharmaceuticals segment revenue to be between $1.675 billion and $1.73 billion
  • Total Qualitest segment revenue to be between $640 million and $670 million
  • Total AMS segment revenue to be between $515 million and $535 million
  • Total HealthTronics segment revenue to be between $220 million and $240 million
  • Reported (GAAP) diluted earnings per share to be between $1.07 and $1.27
  • Adjusted diluted earnings per share to be between $5.00 and $5.20
  • Cash flow from operations between $700 million and $800 million
  • Capital expenditures to be approximately $120 million

The company's 2012 guidance is based on certain assumptions including:

  • Adjusted gross margin of between 68 percent and 69 percent
  • Adjusted effective tax rate of between 30.5 percent and 31.5 percent
  • Weighted average number of common shares outstanding of 121 million shares for the year ended Dec 31, 2012

Balance Sheet Update
During the second quarter of 2012, Endo made the mandatory payments of approximately $14 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 $523 million, inclusive of $465 million in cumulative voluntary prepayments, through second quarter 2012.  We believe that we will achieve our objective of reducing our debt to adjusted EBITDA ratio to 2.0 to 2.5 times in 2013. 

Conference Call Information
Endo will conduct a conference call with financial analysts to discuss this news release today at 8:30 a.m. ET.  Investors and other interested parties may call 866-510-0707 (domestic) or +1 617-597-5376 (international) and enter passcode 14424394.  Please dial in 10 minutes prior to the scheduled start time.

A replay of the call will be available from Aug 7 at 10:30 p.m. ET until 12:00 p.m. ET on Aug. 21, 2012 by dialing 888-286-8010 (domestic) or +1 617-801-6888 (international) and entering passcode 91401586.

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 Aug. 21, 2012.  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 for each of the three months ended June 30, 2012 and 2011 (in thousands, except per share data):

 

Three Months Ended June 30, 2012 (unaudited)

 Actual Reported
 (GAAP)


Adjustments



Adjusted

REVENUES

$

785,188



$




$

785,188









COSTS AND EXPENSES:







Cost of revenues

294,570



(58,857)


(1)


235,713


Selling, general and administrative

233,622



(5,697)


(2)


227,925


Research and development

45,427



(2,808)


(3)


42,619


Patent litigation settlement expense

131,361



(131,361)


(4)



Asset impairment charges

3,000



(3,000)


(5)



Acquisition-related and integration items, net

7,055



(7,055)


(6)



OPERATING INCOME

$

70,153



$

208,778




$

278,931


INTEREST EXPENSE, NET

45,985



(5,169)


(7)


40,816


LOSS ON EXTINGUISHMENT OF DEBT, NET







OTHER EXPENSE, NET

297



(300)


(8)


(3)


[INCOME] BEFORE INCOME TAX

$

23,871



$

214,247




$

238,118


INCOME TAX

1,776



69,559


(9)


71,335


CONSOLIDATED NET INCOME

$

22,095



$

144,688




$

166,783


Less: Net income attributable to noncontrolling interests

12,630






12,630


NET INCOME ATTRIBUTABLE TO ENDO HEALTH
SOLUTIONS INC.

$

9,465



$

144,688




$

154,153


DILUTED (LOSS) EARNINGS PER SHARE

$

0.08






$

1.27


DILUTED WEIGHTED AVERAGE SHARES

121,080






121,080


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 $55,812, the impact of inventory step-up recorded as part of acquisition accounting of ($382), net milestone payments of $2,618 and certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations of $809.

(2) To exclude certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations of $2,945 and amortization of customer relationships of $2,752.

(3) To exclude milestone payments to partners.

(4) To exclude the impact of the Watson litigation settlement.

(5) To exclude asset impairment charges.

(6) To exclude acquisition-related and integration costs of $6,996 and a loss of $59 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 payments to partners.

(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 June 30, 2011 (unaudited)

 Actual Reported
 (GAAP)


Adjustments



Adjusted

REVENUES

$

607,611



$




$

607,611









COSTS AND EXPENSES:







Cost of revenues

236,697



(52,018)


(1)


184,679


Selling, general and administrative

178,133



(954)


(2)


177,179


Research and development

40,840



(4,990)


(3)


35,850


Acquisition-related and integration items, net

17,626



(17,626)


(4)



OPERATING INCOME

$

134,315



$

75,588




$

209,903


INTEREST EXPENSE, NET

25,560



(4,719)


(5)


20,841


LOSS ON EXTINGUISHMENT OF DEBT, NET

8,548



(8,548)


(6)



OTHER INCOME, NET

(125)






(125)


INCOME BEFORE INCOME TAX

$

100,332



$

88,855




$

189,187


INCOME TAX

32,780



14,738


(7)


47,518


CONSOLIDATED NET INCOME

$

67,552



$

74,117




$

141,669


Less: Net income attributable to noncontrolling interests

12,969






12,969


NET INCOME ATTRIBUTABLE TO ENDO HEALTH
SOLUTIONS INC.

$

54,583



$

74,117




$

128,700


DILUTED (LOSS) EARNINGS PER SHARE

$

0.44






$

1.05


DILUTED WEIGHTED AVERAGE SHARES

122,686






122,686


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 $40,023, the impact of inventory step-up recorded as part of acquisition accounting of $2,995, 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 $533 and amortization of customer relationships of $421.

(3) To exclude milestone and upfront payments to partners.

(4) To exclude acquisition-related and integration costs of $24,171 and a gain of $(6,545) recorded to reflect the change in fair value of the contingent consideration associated with the Indevus and Qualitest acquisitions.

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

(6) To exclude the unamortized debt issuance costs written off and recorded as a loss on extinguishment of debt upon the early termination of our 2010 Credit Facility.

(7) 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 six months ended June 30, 2012 and 2011 (in thousands, except per share data):

 

Six Months Ended June 30, 2012 (unaudited)

 Actual
Reported
 (GAAP)


Adjustments



Adjusted

REVENUES

$

1,475,821



$




$

1,475,821









COSTS AND EXPENSES:







Cost of revenues

659,390



(220,095)


(1)


439,295


Selling, general and administrative

488,076



(19,564)


(2)


468,512


Research and development

134,115



(49,780)


(3)


84,335


Patent litigation settlement expense

131,361



(131,361)


(4)



Asset impairment charges

43,000



(43,000)


(5)



Acquisition-related and integration items, net

10,804



(10,804)


(6)



OPERATING INCOME

$

9,075



$

474,604




$

483,679


INTEREST EXPENSE, NET

92,881



(10,145)


(7)


82,736


LOSS ON EXTINGUISHMENT OF DEBT, NET

5,426



(5,426)


(8)



OTHER EXPENSE, NET

748



(300)


(9)


448


(LOSS) INCOME BEFORE INCOME TAX

$

(89,980)



$

490,475




$

400,495


INCOME TAX

(37,550)



152,142


(10)


114,592


CONSOLIDATED NET (LOSS) INCOME

$

(52,430)



$

338,333




$

285,903


Less: Net income attributable to noncontrolling interests

25,450






25,450


NET INCOME ATTRIBUTABLE TO ENDO HEALTH
SOLUTIONS INC.

$

(77,880)



$

338,333




$

260,453


DILUTED (LOSS) EARNINGS PER SHARE

$

(0.67)






$

2.14


DILUTED WEIGHTED AVERAGE SHARES

117,022






121,836


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 $106,415, 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 $110,000, net milestone payments of $1,487 and certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations of $1,313.

(2) To exclude certain integration costs and separation benefits incurred in connection with continued efforts to enhance the company's operations of $14,055 and amortization of customer relationships of $5,509.

(3) To exclude milestone payments to partners.

(4) To exclude the impact of the Watson litigation settlement.

(5) To exclude asset impairment charges.

(6) To exclude acquisition-related and integration costs of $10,872 and a gain of $(68) 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 2012 prepayments on our Term Loan indebtedness.

(9) To exclude milestone payments to partners.

(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.

 

Six Months Ended June 30, 2011 (unaudited)

 Actual
Reported
 (GAAP)


Adjustments



Adjusted

REVENUES

$

1,167,637



$




$

1,167,637









COSTS AND EXPENSES:







Cost of revenues

468,255



(103,015)


(1)


365,240


Selling, general and administrative

337,519



(4,416)


(2)


333,103


Research and development

82,970



(15,991)


(3)


66,979


Acquisition-related and integration items, net

23,699



(23,699)


(4)



OPERATING INCOME

$

255,194



$

147,121




$

402,315


INTEREST EXPENSE, NET

44,350



(9,260)


(5)


35,090


LOSS ON EXTINGUISHMENT OF DEBT, NET

8,548



(8,548)


(6)



OTHER INCOME, NET

223






223


INCOME BEFORE INCOME TAX

$

202,073



$

164,929




$

367,002


INCOME TAX

66,226



26,421


(7)


92,647


CONSOLIDATED NET INCOME

$

135,847



$

138,508




$

274,355


Less: Net income attributable to noncontrolling interests

25,477






25,477


NET INCOME ATTRIBUTABLE TO ENDO HEALTH
SOLUTIONS INC.

$

110,370



$

138,508




$

248,878


DILUTED (LOSS) EARNINGS PER SHARE

$

0.91






$

2.04


DILUTED WEIGHTED AVERAGE SHARES

121,724






121,724


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 $77,234, the impact of inventory step-up recorded as part of acquisition accounting of $16,781, 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 $3,995 and amortization of customer relationships of $421.

(3) To exclude milestone and upfront payments to partners.

(4) To exclude acquisition-related and integration costs of $30,929 and a gain of $(7,230) recorded to reflect the change in fair value of the contingent consideration associated with the Indevus and Qualitest acquisitions. 

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

(6) To exclude the unamortized debt issuance costs written off and recorded as a loss on extinguishment of debt upon the early termination of our 2010 Credit Facility.

(7) 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.

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 2012




Year Ending


December 31, 2012

Projected GAAP diluted income per common share

$

1.07


To

$

1.27


Upfront and milestone-related payments to partners

0.64



0.64


Amortization of commercial intangible assets and inventory step-up

1.89



1.89


Acquisition and integration costs related to recent acquisitions.

0.35



0.35


One-time payment now expected to be made to Impax Labs

0.91



0.91


Watson litigation settlement

1.09



1.09


Impairment of long-lived assets

0.33



0.33


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

0.22



0.22


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

(1.50)



(1.50)


Diluted adjusted income per common share guidance

$

5.00


To

$

5.20


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 Aug 7, 2012.

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 six months ended June 30, 2012 and 2011:

 

 

Endo Health Solutions Inc.
Net Revenues (unaudited)
(in thousands)










Three Months Ended June 30,


Percent Growth


Six Months Ended June 30,


Percent Growth


2012


2011



2012


2011


Endo Pharmaceuticals:












LIDODERM®

$

228,006



$

195,840



16

%


$

438,020



$

385,565



14

%

OPANA® ER

93,413



92,853



1

%


174,499



177,468



(2)

%

Voltaren® Gel

43,690



36,655



19

%


43,690



67,953



(36)

%

PERCOCET®

25,824



27,675



(7)

%


49,204



54,635



(10)

%

FROVA®

14,002



14,163



(1)

%


29,646



27,371



8

%

SUPPRELIN® LA

14,797



12,515



18

%


28,243



23,737



19

%

VANTAS®

4,346



2,054



112

%


8,238



5,599



47

%

VALSTAR®

6,087



5,124



19

%


12,323



9,925



24

%

FORTESTA® Gel

6,881



2,028



239

%


12,703



1,059



1,100

%

Other Branded Products

1,120



5,609



(80)

%


855



12,579



(93)

%

Royalty and Other Revenue

4,620



3,751



23

%


8,939



7,890



13

%

Total Endo Pharmaceuticals

$

442,786



$

398,267



11

%


$

806,360



$

773,781



4

%

Total Qualitest

$

159,895



$

133,047



20

%


$

305,240



$

267,456



14

%

American Medical Systems:












Men's Health

66,972



9,768



586

%


134,412



9,768



1,276

%

Women's Health

32,466



7,787



317

%


66,364



7,787



752

%

BPH Therapy

28,693



9,257



210

%


57,521



9,257



521

%

Total AMS

128,131



26,812



378

%


258,297



26,812



863

%

HealthTronics

54,376



49,485



10

%


105,924



99,588



6

%

Total Revenue

785,188



607,611



29

%


1,475,821



1,167,637



26

%


The following table presents Endo's unaudited Pro forma Net Revenues for the six quarters ended June 30, 2012 giving effect to the AMS acquisition as if it had occurred on January 1, 2011:

 

Endo Health Solutions Inc.

Net Pro Forma Revenues (unaudited)

(in thousands)

 






2011


2012

Endo Pharmaceuticals:

Q1


Q2


Q3


Q4


Q1


Q2

LIDODERM®

$

189,725



$

195,840



$

207,364



$

232,252



$

210,014



$

228,006


OPANA® ER

84,615



92,853



97,753



109,118



81,086



93,413


Voltaren® Gel

31,298



36,655



36,260



38,488





43,690


PERCOCET®

26,960



27,675



28,130



21,835



23,380



25,824


FROVA®

13,208



14,163



14,815



15,994



15,644



14,002


SUPPRELIN® LA

11,222



12,515



12,695



13,683



13,446



14,797


VANTAS®

3,545



2,054



5,013



8,366



3,892



4,346


VALSTAR®

4,801



5,124



6,295



5,301



6,236



6,087


FORTESTA® Gel

(969)



2,028



8,409



5,401



5,822



6,881


Other Branded Products

6,970



5,609



4,948



4,224



(265)



1,120


Royalty and Other Revenue

4,221



3,751



3,829



3,813



4,319



4,620


Total Endo Pharmaceuticals

$

375,596



$

398,267



$

425,511



$

458,475



$

363,574



$

442,786


Total Qualitest

$

134,409



$

133,047



$

147,975



$

151,423



$

145,345



$

159,895


American Medical Systems:












Men's Health

67,407



47,790



66,548



69,520



67,440



66,972


Women's Health

45,325



46,689



38,240



39,482



33,898



32,466


BPH Therapy

28,054



29,784



26,731



32,966



28,828



28,693


Total AMS

$

140,786



$

124,263



$

131,519



$

141,968



$

130,166



$

128,131


HealthTronics(1)

50,103



49,485



54,073



51,540



51,548



54,376


Total Revenue

$

700,894



$

705,062



$

759,078



$

803,406



$

690,633



$

785,188



(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 June 30, 2012 and December 31, 2011:


June 30,
2012


December 31,
2011

ASSETS




CURRENT ASSETS:




Cash and cash equivalents

$

391,946



$

547,620


Accounts receivable, net

721,850



733,222


Inventories, net

327,603



262,419


Other assets

297,049



244,835


Total current assets

$

1,738,448



$

1,788,096


PROPERTY, PLANT AND EQUIPMENT, NET

319,543



297,731


GOODWILL

2,565,253



2,558,041


OTHER INTANGIBLES, NET

2,353,455



2,504,124


OTHER ASSETS

125,176



144,591


TOTAL ASSETS

$

7,101,875



$

7,292,583


LIABILITIES AND STOCKHOLDERS' EQUITY




CURRENT LIABILITIES:




Accounts payable and accrued expenses

$

1,140,072



$

993,216


Other current liabilities

121,938



128,562


Total current liabilities

$

1,262,010



$

1,121,778


DEFERRED INCOME TAXES

551,128



617,677


LONG-TERM DEBT, LESS CURRENT PORTION, NET

3,174,140



3,424,329


OTHER LIABILITIES

161,977



89,208


STOCKHOLDERS' EQUITY:




Total Endo Health Solutions Inc. stockholders' equity

$

1,892,908



$

1,977,690


Noncontrolling interests

59,712



61,901


Total stockholders' equity

$

1,952,620



$

2,039,591


TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

7,101,875



$

7,292,583


The following table presents unaudited condensed consolidated Statement of Cash Flow data for the six months ended June 30, 2012 and 2011:


Six Months Ended June 30,


2012


2011

OPERATING ACTIVITIES:




Consolidated net (loss) income

$

(52,430)



$

135,847


Adjustments to reconcile consolidated net (loss) income to net cash provided by operating activities:




Depreciation and amortization

139,563



97,739


Stock-based compensation

33,346



18,772


Amortization of debt issuance costs and premium / discount

17,521



14,345


Other

(26,591)



9,366


Changes in assets and liabilities which provided (used) cash:

64,930



(61,756)


Net cash provided by operating activities

176,339



214,313


INVESTING ACTIVITIES:




Purchases of property, plant and equipment, net

(46,414)



(23,324)


Other

14,243



(2,345,270)


Net cash used in investing activities

(32,171)



(2,368,594)


FINANCING ACTIVITIES:




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

(53,101)



(34,701)


Distributions to noncontrolling interests

(26,158)



(25,813)


Principal (payments) on indebtedness, net of proceeds

(233,445)



2,427,228


Exercise of Endo Health Solutions Inc. stock options

10,819



20,328


Other

1,752



(77,210)


Net cash (used in) provided by financing activities

(300,133)



2,309,832


Effect of foreign exchange rate

291



104


NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS

(155,674)



155,655


CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD

547,620



466,214


CASH AND CASH EQUIVALENTS, END OF PERIOD

$

391,946



$

621,869


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 Inc.



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