- Q2'23 net revenue of $1.15 billion decreased 6% as reported,
or 2% in constant currency(1), compared to Q2'22. Organic,
constant-currency net revenue decreased by 4%, compared to
Q2'22.
- Q2'23 net earnings of $81 million.
- Q2'23 Adjusted EBITDA(1) of $283 million decreased 9% as
reported, or 6% in constant currency, compared to Q2'22.
- Catalent reiterates full-year guidance, including net
revenue of $4,625 million to $4,875 million and Adjusted EBITDA of
$1,220 million to $1,300 million.
- Moderna and Catalent to extend collaboration to broaden
manufacturing partnership across multiple products and formats in
North America and Europe.
Catalent, Inc. (NYSE: CTLT), the global leader in enabling
pharma, biotech, and consumer health partners to optimize
development, launch, and supply of better patient treatments across
multiple modalities, today announced financial results for the
second quarter of fiscal 2023, which ended December 31, 2022.
Catalent also announced that it will be extending and expanding
its manufacturing partnership with Moderna, which will see Catalent
support the manufacture of multiple Moderna products in multiple
formats across its North American and European biologics drug
product facilities. Catalent will continue to provide drug product
fill/finish services and production capacity for Moderna’s COVID-19
programs. In addition, there are plans to extend their ongoing
partnership to non-COVID-19 programs such as flu and respiratory
syncytial virus (RSV) vaccines, beginning with its manufacturing
site in Bloomington, Indiana, and to be expanded to its European
facility in Anagni, Italy.
“We are well positioned to leverage the diverse investments we
have made across our portfolio to support sustainable, long-term,
and profitable growth,” commented Alessandro Maselli, President and
Chief Executive Officer of Catalent, Inc. “Notably, our extended
partnership with Moderna, a pioneer in mRNA technology, and our
recently expanded partnership with Sarepta, a leader in gene
therapy, build on our long experience with customers in these
growth areas. These partnerships underscore the importance we place
on our long-term trusted relationships. In addition, we are
improving efficiency with the restructuring actions that we have
executed recently, and we are bringing a renewed focus on
efficiency across our organization as a whole.”
(1) See "Non-GAAP Financial Measures" below and the GAAP to
non-GAAP reconciliation provided later in this release.
Second Quarter 2023 Consolidated Results
Net revenue of $1.15 billion decreased 6% reported, or 2% in
constant currency, from the $1.22 billion reported for the second
quarter a year ago. Overall organic net revenue (i.e., excluding
the effect of acquisitions, divestitures, and currency translation)
decreased by 4% over the same period.
Net earnings attributable to common shareholders and earnings
per basic and diluted share was $81 million, or $0.45 per basic
share and $0.44 per diluted share, compared to net earnings
attributable to common shareholders of $93 million, or $0.53 per
basic and $0.52 per diluted share, in the second quarter a year
ago, respectively. A substantial decrease in COVID-19-related
revenue quarter-over-quarter was partially offset by a substantial
increase in our non-COVID revenue.
EBITDA from operations(1) was $264 million, an increase of $19
million from $245 million in the second quarter a year ago. Second
quarter fiscal 2023 Adjusted EBITDA(1) was $283 million, or 25% of
net revenue, compared to $310 million, or 25% of net revenue, in
the second quarter a year ago. This represents a decrease of 9% as
reported and a decrease of 6% on a constant-currency basis,
compared to the fiscal 2022 period. The quarter-over-quarter
decrease in Adjusted EBITDA was primarily due to a substantial
decrease in COVID-19-related revenue.
Adjusted Net Income(1) was $122 million, or $0.67 per diluted
share, compared to Adjusted Net Income of $163 million, or $0.90
per diluted share, in the second quarter a year ago.
(1) See "Non-GAAP Financial Measures" below and the GAAP to
non-GAAP reconciliation provided later in this release.
Second Quarter 2023 Segment Review
(Dollars in millions)
Three Months Ended December
31,
Constant Currency
2022
2021
Change %
Biologics
Net revenue
$
580
$
641
(7
)%
Segment EBITDA
181
199
(7
)%
Segment EBITDA margin
31.3
%
31.1
%
Pharma and Consumer Health
Net revenue
570
577
3
%
Segment EBITDA
135
147
(3
)%
Segment EBITDA margin
23.7
%
25.4
%
Inter-segment revenue
elimination
(1
)
(1
)
30
%
Unallocated costs
(52
)
(101
)
(44
)%
Combined totals
Net revenue
$
1,149
$
1,217
(2
)%
EBITDA from operations
$
264
$
245
11
%
Biologics segment
2022 vs. 2021
2022 vs. 2021
Year-Over-Year Change
Three Months Ended
December 31,
Six Months Ended
December 31,
Net Revenue
Segment EBITDA
Net Revenue
Segment EBITDA
Organic
(7
)%
(5
)%
(5
)%
(17
)%
Impact of acquisitions
—
%
(2
)%
—
%
(2
)%
Constant-currency change
(7
)%
(7
)%
(5
)%
(19
)%
Foreign exchange translation impact on
reporting
(3
)%
(2
)%
(2
)%
(1
)%
Total % change
(10
)%
(9
)%
(7
)%
(20
)%
Pharma and Consumer Health
segment
2022 vs. 2021
2022 vs. 2021
Year-Over-Year Change
Three Months Ended
December 31,
Six Months Ended
December 31,
Net Revenue
Segment EBITDA
Net Revenue
Segment EBITDA
Organic
—
%
(7
)%
—
%
(1
)%
Impact of acquisitions
3
%
4
%
7
%
7
%
Constant-currency change
3
%
(3
)%
7
%
6
%
Foreign currency translation impact on
reporting
(4
)%
(5
)%
(6
)%
(7
)%
Total % change
(1
)%
(8
)%
1
%
(1
)%
Segment Net Revenue as a % of Total Net
Revenue
Three Months Ended
December 31, 2022
September 30,
2022
June 30, 2022
March 31, 2022
December 31, 2021
Biologics
50
%
51
%
51
%
55
%
53
%
Pharma and Consumer Health
50
%
49
%
49
%
45
%
47
%
Net Revenue
100
%
100
%
100
%
100
%
100
%
Balance Sheet and Liquidity
As of December 31, 2022, Catalent had $4.85 billion in total
debt, and $4.38 billion in total debt net of cash, cash
equivalents, and marketable securities, compared to $3.86 billion
in total net debt as of September 30, 2022.
Catalent’s net leverage ratio(1) as of December 31, 2022 was
3.7x, compared to 3.2x at September 30, 2022 and 2.8x as of
December 31, 2021.
(1) See "Non-GAAP Financial Measures" below and the GAAP to
non-GAAP reconciliation provided later in this release.
Fiscal Year 2023 Outlook
FY'23
Full Year Guidance
Net revenue
$4,625 million - $4,875
million
Adjusted EBITDA
$1,220 million - $1,300
million
Adjusted net income
$567 million - $648 million
Weighted average shares outstanding -
diluted
181 million - 183 million
Catalent reiterates its fiscal year 2023 financial outlook
issued on November 1, 2022.
Earnings Webcast
The Company’s management will host a webcast to discuss the
results at 8:15 a.m. ET today. Catalent invites all interested
parties to listen to the webcast, which will be accessible through
Catalent’s website at http://investor.catalent.com. A supplemental
slide presentation will also be available in the “Investors”
section of Catalent’s website prior to the start of the webcast.
The webcast replay, along with the supplemental slides, will be
available for 90 days in the “Investors” section of Catalent’s
website at www.catalent.com.
About Catalent, Inc.
Catalent is the global leader in enabling pharma, biotech, and
consumer health partners to optimize product development, launch,
and full life-cycle supply for patients around the world. With
broad and deep scale and expertise in development sciences,
delivery technologies, and multi-modality manufacturing, Catalent
is a preferred industry partner for personalized medicines,
consumer health brand extensions, and blockbuster drugs. Catalent
helps accelerate over 1,000 partner programs and launch over 150
new products every year. Its flexible manufacturing platforms at
over 50 global sites supply around 80 billion doses of nearly 8,000
products annually. Catalent’s expert workforce of approximately
18,000 includes more than 3,000 scientists and technicians.
Headquartered in Somerset, New Jersey, the company generated nearly
$5 billion in revenue in its 2022 fiscal year. For more
information, visit www.catalent.com.
Non-GAAP Financial Measures
Use of EBITDA from operations, Adjusted EBITDA, Adjusted Net
Income and Segment EBITDA
Management measures operating performance based on consolidated
earnings from operations before interest expense, expense (benefit)
for income taxes, and depreciation and amortization, adjusted for
the income or loss attributable to non-controlling interests
(“EBITDA from operations”). EBITDA from operations is not defined
under U.S. GAAP, is not a measure of operating income, operating
performance, or liquidity presented in accordance with U.S. GAAP,
and is subject to important limitations.
Catalent believes that the presentation of EBITDA from
operations enhances an investor’s understanding of its financial
performance. Catalent believes this measure is a useful financial
metric to assess its operating performance across periods by
excluding certain items that it believes are not representative of
its core business and uses this measure for business planning
purposes.
In addition, given the significant investments that Catalent has
made in the past in property, plant and equipment, depreciation and
amortization expenses represent a meaningful portion of its cost
structure. Catalent believes that EBITDA from operations will
provide investors with a useful tool for assessing the
comparability between periods of Catalent's ability to generate
cash from operations sufficient to pay taxes, to service debt and
to undertake capital expenditures because it eliminates
depreciation and amortization expense. Catalent presents EBITDA
from operations in order to provide supplemental information that
it considers relevant for the readers of its consolidated financial
statements, and such information is not meant to replace or
supersede U.S. GAAP measures. Catalent’s definition of EBITDA from
operations may not be the same as similarly titled measures used by
other companies.
Catalent evaluates the performance of its segments based on
segment earnings before non-controlling interest, other (income)
expense, impairments, restructuring costs, interest expense, income
tax expense (benefit), and depreciation and amortization (“segment
EBITDA”). Moreover, under Catalent’s credit agreement, its ability
to engage in certain activities, such as incurring certain
additional indebtedness, making certain investments and paying
certain dividends, is tied to ratios based on Adjusted EBITDA,
which is not defined under U.S. GAAP, is not a measure of operating
income, operating performance, or liquidity presented in accordance
with U.S. GAAP, and is subject to important limitations. Adjusted
EBITDA is the covenant compliance measure used in the credit
agreement governing debt incurrence and restricted payments.
Because not all companies use identical calculations, Catalent’s
presentation of Adjusted EBITDA may not be comparable to similarly
titled measures of other companies.
Management also measures operating performance based on Adjusted
Net Income and Adjusted Net Income per share. Adjusted Net Income
is not defined under U.S. GAAP, is not a measure of operating
income, operating performance, or liquidity presented in accordance
with U.S. GAAP and is subject to important limitations. Catalent
believes that the presentation of Adjusted Net Income and Adjusted
Net Income per share enhances an investor’s understanding of its
financial performance. Catalent believes these measures are a
useful financial metric to assess its operating performance across
periods by excluding certain items that it believes are not
representative of its core business and Catalent uses these
measures for business planning purposes. Catalent defines Adjusted
Net Income as net earnings adjusted for amortization attributable
to purchase accounting and adjustments for other cash and non-cash
items included in the table below, partially offset by its estimate
of the tax effects of such cash and non-cash items. Catalent
believes that Adjusted Net Income and Adjusted Net Income per share
provides investors with a useful tool for assessing the
comparability between periods of its ability to generate cash from
operations available to its stockholders. Catalent’s definition of
Adjusted Net Income may not be the same as similarly titled
measures used by other companies. Adjusted Net Income per share is
computed by dividing Adjusted Net Income by the weighted average
diluted shares outstanding.
The most directly comparable U.S. GAAP measure to EBITDA from
operations, Adjusted EBITDA, and Adjusted Net Income is net
earnings. Included in this release is a reconciliation of net
earnings to EBITDA from operations, Adjusted EBITDA and Adjusted
Net Income.
Catalent does not provide a reconciliation of forward-looking
non-GAAP financial measures to their comparable U.S. GAAP financial
measures because it could not do so without unreasonable effort due
to the unavailability of the information needed to calculate
reconciling items and due to the variability, complexity and
limited visibility of the adjusting items that would be excluded
from the non-GAAP financial measures in future periods. When
planning, forecasting, and analyzing future periods, Catalent does
so primarily on a non-GAAP basis without preparing a U.S. GAAP
analysis as that would require estimates for various cash and
non-cash reconciling items that would be difficult to predict with
reasonable accuracy. For example, equity compensation expense would
be difficult to estimate because it depends on Catalent’s future
hiring and retention needs, as well as the future fair market value
of its common stock, all of which are difficult to predict and
subject to constant change. It is equally difficult to anticipate
the need for or magnitude of a presently unforeseen one-time
restructuring expense or the values of end-of-period foreign
currency exchange rates. As a result, Catalent does not believe
that a U.S. GAAP reconciliation would provide meaningful
supplemental information about its outlook.
Use of Constant Currency
As changes in exchange rates are an important factor in
understanding period-to-period comparisons, Catalent believes the
presentation of results on a constant-currency basis in addition to
reported results helps improve investors’ ability to understand its
operating results and evaluate its performance in comparison to
prior periods. Constant-currency information compares results
between periods as if exchange rates had remained constant period
over period. Catalent uses results on a constant-currency basis as
one measure to evaluate its performance. Catalent calculates
constant currency by calculating current-year results using
prior-year foreign currency exchange rates. Catalent generally
refers to such amounts calculated on a constant-currency basis as
excluding the impact of foreign exchange or being on a
constant-currency basis. These results should be considered in
addition to, not as a substitute for, results reported in
accordance with U.S. GAAP. Results on a constant-currency basis, as
Catalent presents them, may not be comparable to similarly titled
measures used by other companies and are not measures of
performance presented in accordance with U.S. GAAP.
Forward-Looking Statements
This release contains both historical and forward-looking
statements. All statements other than statements of historical
fact, are, or may be deemed to be, forward-looking statements
within the meaning 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 generally can be
identified by the use of statements that include phrases such as
“believe,” “expect,” “anticipate,” “intend,” “estimate,” “plan,”
“project,” “predict,” “hope,” “foresee,” “likely,” “may,” “could,”
“target,” “will,” “would,” or other words or phrases with similar
meanings. Similarly, statements that describe Catalent’s
objectives, plans, or goals are, or may be, forward-looking
statements. These statements are based on current expectations of
future events. If underlying assumptions prove inaccurate or
unknown risks or uncertainties materialize, actual results could
vary materially from Catalent’s expectations and projections. Some
of the factors that could cause actual results to differ include,
but are not limited to, the following: the current or future
effects of the COVID-19 pandemic or any global health developments
on Catalent's or its customers' or suppliers' businesses;
participation in a highly competitive market and increased
competition that may adversely affect Catalent’s business; demand
for its offerings, which depends in part on its customers’ research
and development and the clinical and market success of their
products; product and other liability risks that could adversely
affect Catalent’s results of operations, financial condition,
liquidity and cash flows; failure to comply with existing and
future regulatory requirements; failure to provide quality
offerings to customers could have an adverse effect on Catalent’s
business and subject it to regulatory actions and costly
litigation; problems providing the highly exacting and complex
services or support required; global economic, political and
regulatory risks to Catalent’s operations, including risks from
rising inflation, disruptions to global supply chains, or from the
Ukrainian-Russian war; inability to enhance existing or introduce
new technology or service offerings in a timely manner; inadequate
patents, copyrights, trademarks and other forms of intellectual
property protections; fluctuations in the costs, availability, and
suitability of the components of the products Catalent
manufactures, including active pharmaceutical ingredients,
excipients, purchased components and raw materials; changes in
market access or healthcare reimbursement in the United States or
internationally; fluctuations in the exchange rate of the U.S.
dollar against other currencies; adverse tax legislative or
regulatory initiatives or challenges or adjustments to Catalent’s
tax positions; loss of key personnel; risks generally associated
with information systems; inability to complete any future
acquisition or other transaction that may complement or expand its
business or divest of non-strategic businesses or assets and
difficulties in successfully integrating acquired businesses and
realizing anticipated benefits of such acquisitions; risks
associated with timely and successfully completing, and correctly
anticipating the future demand predicted for, capital expansion
projects at existing facilities; offerings and customers’ products
that may infringe on the intellectual property rights of third
parties; environmental, health, and safety laws and regulations,
which could increase costs and restrict operations; labor and
employment laws and regulations or labor difficulties, which could
increase costs or result in operational disruptions; additional
cash contributions required to fund Catalent’s existing pension
plans; substantial leverage that may limit its ability to raise
additional capital to fund operations and react to changes in the
economy or in the industry; and exposure to interest-rate risk to
the extent of its variable-rate debt preventing it from meeting its
obligations under its indebtedness. For a more detailed discussion
of these and other factors, see the information under the caption
“Risk Factors” in Catalent’s Annual Report on Form 10-K for the
fiscal year ended June 30, 2022, filed August 29, 2022. All
forward-looking statements speak only as of the date of this
release or as of the date they are made, and Catalent does not
undertake to update any forward-looking statement as a result of
new information or future events or developments except to the
extent required by law.
More products. Better treatments. Reliably
supplied.™
Catalent, Inc.
Consolidated Statements of
Operations
(Unaudited; dollars and shares
in millions, except per share data)
Three Months Ended
December 31,
FX Impact
Constant Currency Increase
(Decrease)
2022
2021
Change $
Change %
Net revenue
$
1,149
$
1,217
$
(42
)
$
(26
)
(2
)%
Cost of sales
762
812
(30
)
(20
)
(2
)%
Gross margin
387
405
(12
)
(6
)
(2
)%
Selling, general, and administrative
expenses
226
228
(3
)
1
1
%
Other operating expense, net
23
16
(2
)
9
44
%
Operating earnings
138
161
(7
)
(16
)
(10
)%
Interest expense, net
47
32
(1
)
16
49
%
Other (income) expense, net
(23
)
14
(1
)
(36
)
(256
)%
Earnings before income taxes
114
115
(5
)
4
4
%
Income tax expense
33
18
(2
)
17
102
%
Net earnings
$
81
$
97
$
(3
)
$
(13
)
(13
)%
Less: Net earnings attributable to
preferred shareholders
—
(4
)
Net earnings attributable to common
shareholders
$
81
$
93
Weighted average shares outstanding –
basic
181
175
Weighted average shares outstanding –
diluted
181
177
Earnings per share:
Basic
Net earnings
$
0.45
$
0.53
Diluted
Net earnings
$
0.44
$
0.52
Catalent, Inc.
Consolidated Statements of
Operations
(Unaudited; dollars and shares
in millions, except per share data)
Six Months Ended
December 31,
FX impact
Constant Currency Increase
(Decrease)
2022
2021
Change $
Change %
Net revenue
$
2,171
$
2,242
$
(90
)
$
19
1
%
Cost of sales
1,526
1,513
(65
)
78
5
%
Gross margin
645
729
(25
)
(59
)
(8
)%
Selling, general and administrative
expenses
422
411
(10
)
21
5
%
Gain on sale of subsidiary
—
(1
)
—
1
*
Other operating expense
25
20
(1
)
6
25
%
Operating earnings
198
299
(14
)
(87
)
(29
)%
Interest expense, net
79
58
(1
)
22
39
%
Other expense, net
2
23
(9
)
(12
)
(53
)%
Earnings before taxes
117
218
(4
)
(97
)
(45
)%
Income tax expense
36
28
(3
)
11
42
%
Net earnings
$
81
$
190
$
(1
)
$
(108
)
(57
)%
Less: Net earnings attributable to
preferred shareholders
—
(13
)
Net earnings attributable to common
shareholders
$
81
$
177
Weighted average shares outstanding –
basic
180
173
Weighted average shares outstanding –
diluted
181
175
Earnings per share:
Basic
Net earnings
$
0.45
$
1.02
Diluted
Net earnings
$
0.45
$
1.01
Catalent, Inc.
Condensed Consolidated Balance
Sheets
(Unaudited; dollars in
millions)
December 31,
2022
June 30, 2022
ASSETS
Current assets:
Cash and cash equivalents
$
442
$
449
Trade receivables, net
916
1,051
Inventories
818
702
Prepaid expenses and other
714
625
Marketable securities
28
89
Total current assets
2,918
2,916
Property, plant, and equipment, net
3,579
3,127
Other non-current assets, including
intangible assets
4,650
4,464
Total assets
$
11,147
$
10,507
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current liabilities:
Current portion of long-term obligations
and other short-term borrowings
$
632
$
31
Accounts payable
367
421
Other accrued liabilities
527
620
Total current liabilities
1,526
1,072
Long-term obligations, less current
portion
4,221
4,171
Other non-current liabilities
488
469
Total shareholders' equity
4,912
4,795
Total liabilities and shareholders'
equity
$
11,147
$
10,507
Catalent, Inc.
Condensed Consolidated
Statements of Cash Flows
(Unaudited; dollars in
millions)
Six Months Ended
December 31,
2022
2021
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net cash provided by operating
activities
$
122
$
232
CASH FLOWS FROM INVESTING
ACTIVITIES:
Acquisition of property, equipment, and
other productive assets
(317
)
(277
)
Proceeds from sale of marketable
securities
61
4
Proceeds from sale of property and
equipment
7
—
Settlement on sale of subsidiaries,
net
—
(3
)
Payment for acquisitions, net of cash
acquired
(474
)
(1,020
)
Payments for investments
(1
)
(3
)
Net cash used in investing activities
(724
)
(1,299
)
CASH FLOWS FROM FINANCING
ACTIVITIES:
Proceeds from borrowing
625
1,100
Payments related to long-term
obligations
(32
)
(64
)
Financing fees paid
(4
)
(15
)
Dividends paid
—
(4
)
Cash paid, in lieu of equity, for tax
withholding obligations
—
(9
)
Exercise of stock options
1
19
Other financing activities
7
6
Net cash provided by financing
activities
597
1,033
Effect of foreign currency exchange on
cash and cash equivalents
(2
)
(13
)
NET DECREASE IN CASH AND CASH
EQUIVALENTS
(7
)
(47
)
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD
449
896
CASH AND CASH EQUIVALENTS AT END OF
PERIOD
$
442
$
849
Catalent, Inc.
Reconciliation of Net Earnings
to EBITDA from Operations and Adjusted EBITDA*
(Unaudited; dollars in
millions)
Three months ended
December 31, 2021
March 31, 2022
June 30, 2022
September 30, 2022
December 31, 2022
Net earnings
$
97
$
141
$
188
$
—
$
81
Interest expense, net
32
33
32
32
47
Income tax expense
18
35
23
3
33
Depreciation and amortization
98
99
100
99
103
EBITDA from operations
245
308
343
134
264
Stock-based compensation
11
10
12
19
10
Impairment charges and gain/loss on sale
of assets
16
2
10
(2
)
1
Restructuring costs
1
3
5
4
23
Acquisition, integration, and other
special items
22
9
8
5
9
Foreign exchange loss (gain)
15
1
6
27
(26
)
Inventory fair value step-up charges
—
7
—
—
—
Other adjustments
—
(1
)
—
—
2
Adjusted EBITDA
$
310
$
339
$
384
$
187
$
283
Favorable (unfavorable) FX impact
(10
)
Adjusted EBITDA at constant currency
$
293
* Refer to Catalent's description of
non-GAAP measures, including EBITDA from operations and Adjusted
EBITDA as referenced above.
Catalent, Inc.
Reconciliation of Net Earnings
to Adjusted Net Income*
(Unaudited; dollars in
millions, except per share data)
Three months ended
December 31, 2021
March 31, 2022
June 30, 2022
September 30, 2022
December 31, 2022
Net earnings
$
97
$
141
$
188
$
—
$
81
Amortization (1)
34
33
33
33
34
Stock-based compensation
11
10
12
19
10
Impairment charges and gain/loss on sale
of assets (2)
16
2
10
(2
)
1
Restructuring costs (3)
1
3
5
4
23
Acquisition, integration, and other
special items (4)
22
9
8
5
9
Foreign exchange loss (gain)
15
1
6
27
(26
)
Inventory fair value step-up charges
(5)
—
7
—
—
—
Other adjustments (6)
—
(1
)
(1
)
—
2
Estimated tax effect of adjustments
(7)
(24
)
(15
)
(18
)
(19
)
(12
)
Discrete income tax benefit items (8)
(9
)
(2
)
(28
)
(6
)
—
Adjusted net income (ANI)
$
163
$
188
$
215
$
61
$
122
Weighted average shares outstanding –
basic
175
181
Weighted average shares outstanding –
diluted
177
181
Earnings per share:
Net earnings per share – basic
$
0.53
$
0.45
Net earnings per share – diluted
$
0.52
$
0.44
ANI per share:
ANI per share – basic
$
0.93
$
0.67
ANI per share – diluted (9)
$
0.90
$
0.67
* Refer to Catalent's description of
non-GAAP measures, including Adjusted Net Income as referenced
above.
(1)
Represents the amortization attributable
to purchase accounting for previously completed business
combinations.
(2)
For the three months ended June 30, 2022,
represents fixed asset impairment charges primarily associated with
obsolete equipment in the Biologics segment. For the three months
ended December 31, 2021, represents $16 million in fixed asset
impairment charges primarily associated with a product Catalent no
longer manufactures in its respiratory and specialty platform,
which is part of our Pharma and Consumer Health segment.
(3)
Restructuring costs during the three
months ended December 31, 2022 represent restructuring charges
associated with Catalent's plans to reduce costs, consolidate
facilities, and optimize its infrastructure across the
organization.
(4)
Acquisition, integration and other special
items during the three months ended December 31, 2022 include costs
associated with its October 2022 acquisition of Metrics Contract
Services.
(5)
For the three months ended March 21, 2022,
represents a one-time non-cash inventory fair value adjustment of
$7 million recorded in connection with Catalent's October 2021
acquisition of the Bettera Wellness business.
(6)
Represents unrealized gains related to the
fair value of the derivative liability associated with Catalent's
formerly outstanding Series A convertible preferred stock.
(7)
The tax effect of adjustments to Adjusted
Net Income is computed by applying the statutory tax rate in the
jurisdictions to the income or expense items that are adjusted in
the period presented; if a valuation allowance exists, the rate
applied is zero.
(8)
Discrete period income tax expense items
are unusual or infrequently occurring items, primarily including:
changes in judgment related to the realizability of deferred tax
assets in future years, changes in measurement of a prior-year tax
position, deferred tax impact of changes in tax law, and purchase
accounting.
(9)
For the three months ended December 31,
2022, represents Adjusted Net Income divided by the weighted
average sum of fully diluted shares outstanding, which is equal to
(a) the number of shares of common stock outstanding, plus (b) the
number of shares of our common stock that would be issued assuming
exercise or vesting of all potentially dilutive instruments. For
the three months ended December 31, 2021, represents Adjusted Net
Income divided by the weighted average sum of (a) the number of
shares of common stock outstanding, plus (b) the number of shares
of common stock that would be issued assuming exercise or vesting
of all potentially dilutive instruments, plus (c) the number of
shares of common stock equivalent to the shares of the formerly
outstanding Series A convertible preferred stock outstanding under
the "if-converted" method. For the three months ended December 31,
2022 and 2021, the weighted average number of shares was 181
million.
Catalent, Inc.
Reconciliation of Segment
EBITDA to Net Earnings
(Unaudited; dollars in
millions, except per share data)
Three Months Ended
December 31,
Six Months Ended
December 31,
2022
2021
2022
2021
Biologics Segment EBITDA
$
181
$
199
$
294
$
366
Pharma and Consumer Health Segment
EBITDA
135
147
243
246
Sub-Total
$
316
$
346
$
537
$
612
Reconciling items to net earnings
Unallocated costs (1)
(52
)
(101
)
(139
)
(157
)
Depreciation and amortization
(103
)
(98
)
(202
)
(179
)
Interest expense, net
(47
)
(32
)
(79
)
(58
)
Income tax expense
(33
)
(18
)
(36
)
(28
)
Net earnings
$
81
$
97
$
81
$
190
(1)
Unallocated costs include restructuring
and special items, stock-based compensation, impairment charges,
gain on sale of subsidiary, certain other corporate directed costs,
and other costs that are not allocated to the segments.
Catalent, Inc.
Calculation of Net Leverage
Ratio
(Unaudited; dollars in
millions)
December 31, 2021
March 31, 2022
June 30, 2022
September 30, 2022
December 31, 2022
Total Secured Debt
$
1,431
$
1,428
$
1,424
$
1,497
$
2,013
Total Unsecured Debt
2,789
2,758
2,778
2,707
2,840
Total Debt
4,220
4,186
4,202
4,204
4,853
Cash and Cash Equivalents
849
786
449
281
442
Marketable Securities
66
94
89
64
28
Total Net Debt
3,305
3,306
3,664
3,859
4,383
Adjusted EBITDA
Q3 2021
274
Q4 2021
348
348
Q1 2022
252
252
252
Q2 2022
310
310
310
310
Q3 2022
339
339
339
339
Q4 2022
384
384
384
Q1 2023
187
187
Q2 2023
283
LTM Adjusted EBITDA
$
1,184
$
1,249
$
1,285
$
1,220
$
1,193
Net Sr. Secured Debt / Adj. EBITDA
0.4x
0.4x
0.7x
0.9x
1.3x
Net Debt / Adj. EBITDA
2.8x
2.6x
2.9x
3.2x
3.7x
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230207005249/en/
Investor Contact: Catalent, Inc. Paul Surdez 732-537-6325
investors@catalent.com
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