Stock Analysis on Net
Stock Analysis on Net

Allergan Inc. (NYSE:AGN.)

This company has been moved to the archive! The financial data has not been updated since February 19, 2015.

Analysis of Income Taxes

Microsoft Excel

Income Tax Expense (Benefit)

Allergan Inc., income tax expense (benefit), continuing operations

US$ in thousands

Microsoft Excel
12 months ended: Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
U.S. federal 352,900 342,400 388,500 307,700 287,900
U.S. state 16,200 24,700 20,400 32,700 32,800
Non-U.S. 167,400 152,700 110,200 90,100 94,300
Current 536,500 519,800 519,100 430,500 415,000
U.S. federal (31,600) (34,800) (88,600) (59,800) (244,200)
U.S. state (25,300) (12,600) 100 (18,200) 13,900
Non-U.S. (22,900) (14,100) 200 9,100 (18,800)
Deferred (79,800) (61,500) (88,300) (68,900) (249,100)
Provision for income taxes 456,700 458,300 430,800 361,600 165,900

Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).

Item Description The company
Current Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations. Allergan Inc. current increased from 2012 to 2013 and from 2013 to 2014.
Deferred Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations. Allergan Inc. deferred increased from 2012 to 2013 but then slightly decreased from 2013 to 2014 not reaching 2012 level.
Provision for income taxes Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Allergan Inc. provision for income taxes increased from 2012 to 2013 but then slightly decreased from 2013 to 2014.

Effective Income Tax Rate (EITR)

Allergan Inc., effective income tax rate (EITR) reconciliation

Microsoft Excel
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Statutory rate of tax expense 35.00% 35.00% 35.00% 35.00% 35.00%
State taxes, net of U.S. tax benefit 0.40% 0.90% 1.10% 1.60% 20.40%
Tax differential on foreign earnings -10.80% -9.00% -8.80% -9.10% 28.40%
Other credits (R&D) -2.90% -3.00% -0.90% -2.00% -15.90%
Tax audit settlements/adjustments 0.70% 0.80% 1.30% 1.50% 6.00%
Legal settlement 0.00% 0.00% 0.00% 0.00% 18.80%
Other 0.60% 1.80% 0.40% 0.80% 4.40%
Effective tax rate 23.00% 26.50% 28.10% 27.80% 97.10%

Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).

Item Description The company
Effective tax rate Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Allergan Inc. effective tax rate decreased from 2012 to 2013 and from 2013 to 2014.

Components of Deferred Tax Assets and Liabilities

Allergan Inc., components of deferred tax assets and liabilities

US$ in thousands

Microsoft Excel
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Net operating losses 144,900 179,700 66,600 44,700 40,300
Accrued expenses 173,600 130,000 114,400 105,600 103,300
Capitalized expenses 161,100 176,500 182,300 136,200 104,400
Deferred compensation 52,100 47,400 41,700 35,700 30,200
Medicare, Medicaid and other accrued health care rebates 110,100 80,000 85,000 69,000 48,600
Postretirement medical benefits 21,900 16,600 17,800 16,100 20,600
Capitalized intangible assets 31,500 38,900 45,000 49,900 83,300
Deferred revenue 19,200 19,200 22,300 17,200 13,100
Inventory reserves and adjustments 14,200 14,500 18,700 80,300 75,800
Share-based compensation awards 94,800 101,600 90,200 86,600 88,000
Unbilled costs 28,100 28,300 23,000 25,500 23,600
Pension plans 69,900 52,600 66,500 67,700 52,600
R&D credits 37,200 26,200 12,700 — —
All other 57,400 46,300 30,100 50,000 50,200
Deferred tax assets, gross 1,016,000 957,800 816,300 784,500 734,000
Valuation allowance (39,100) (48,900) (22,600) (14,900) (4,300)
Deferred tax assets 976,900 908,900 793,700 769,600 729,700
Depreciation 13,100 (100) (9,600) (15,500) (15,000)
Developed and technology-related intangible assets (131,300) (153,500) (227,300) (188,300) (213,700)
In-process R&D (428,300) (348,600) (100,800) (107,600) —
All other — — — — (5,500)
Deferred tax liabilities (546,500) (502,200) (337,700) (311,400) (234,200)
Net deferred tax assets (liabilities) 430,400 406,700 456,000 458,200 495,500

Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).

Item Description The company
Deferred tax assets, gross Amount before allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Allergan Inc. deferred tax assets, gross increased from 2012 to 2013 and from 2013 to 2014.
Deferred tax assets Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Allergan Inc. deferred tax assets increased from 2012 to 2013 and from 2013 to 2014.
Net deferred tax assets (liabilities) Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting. Allergan Inc. net deferred tax assets (liabilities) decreased from 2012 to 2013 but then slightly increased from 2013 to 2014.

Deferred Tax Assets and Liabilities, Classification

Allergan Inc., deferred tax assets and liabilities, classification

US$ in thousands

Microsoft Excel
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Net current deferred tax assets 343,500 277,900 249,100 305,600 277,700
Net non-current deferred tax assets 86,900 128,800 206,900 152,600 217,800

Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).

Item Description The company
Net non-current deferred tax assets Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, with jurisdictional netting and classified as noncurrent. Allergan Inc. net non-current deferred tax assets decreased from 2012 to 2013 and from 2013 to 2014.

Adjustments to Financial Statements: Removal of Deferred Taxes

Allergan Inc., adjustments to financial statements

US$ in thousands

Microsoft Excel
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Adjustment to Current Assets
Current assets (as reported) 6,871,200 5,319,700 4,458,800 4,048,300 3,993,700
Less: Current deferred tax assets, net 343,500 277,900 249,100 305,600 277,700
Current assets (adjusted) 6,527,700 5,041,800 4,209,700 3,742,700 3,716,000
Adjustment to Total Assets
Total assets (as reported) 12,415,700 10,574,300 9,179,300 8,508,600 8,308,100
Less: Current deferred tax assets, net 343,500 277,900 249,100 305,600 277,700
Less: Noncurrent deferred tax assets, net 86,900 128,800 206,900 152,600 217,800
Total assets (adjusted) 11,985,300 10,167,600 8,723,300 8,050,400 7,812,600
Adjustment to Total Allergan, Inc. Stockholders’ Equity
Total Allergan, Inc. stockholders’ equity (as reported) 7,753,000 6,463,200 5,837,100 5,309,600 4,757,700
Less: Net deferred tax assets (liabilities) 430,400 406,700 456,000 458,200 495,500
Total Allergan, Inc. stockholders’ equity (adjusted) 7,322,600 6,056,500 5,381,100 4,851,400 4,262,200
Adjustment to Net Earnings Attributable To Allergan, Inc.
Net earnings attributable to Allergan, Inc. (as reported) 1,524,200 985,100 1,098,800 934,500 600
Add: Deferred income tax expense (benefit) (79,800) (61,500) (88,300) (68,900) (249,100)
Net earnings attributable to Allergan, Inc. (adjusted) 1,444,400 923,600 1,010,500 865,600 (248,500)

Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).

Allergan Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Allergan Inc., adjusted financial ratios

Microsoft Excel
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
Current Ratio
Reported current ratio 4.41 4.28 4.07 4.24 2.61
Adjusted current ratio 4.19 4.05 3.84 3.92 2.43
Net Profit Margin
Reported net profit margin 21.39% 15.90% 19.25% 17.48% 0.01%
Adjusted net profit margin 20.27% 14.90% 17.70% 16.19% -5.16%
Total Asset Turnover
Reported total asset turnover 0.57 0.59 0.62 0.63 0.58
Adjusted total asset turnover 0.59 0.61 0.65 0.66 0.62
Financial Leverage
Reported financial leverage 1.60 1.64 1.57 1.60 1.75
Adjusted financial leverage 1.64 1.68 1.62 1.66 1.83
Return on Equity (ROE)
Reported ROE 19.66% 15.24% 18.82% 17.60% 0.01%
Adjusted ROE 19.73% 15.25% 18.78% 17.84% -5.83%
Return on Assets (ROA)
Reported ROA 12.28% 9.32% 11.97% 10.98% 0.01%
Adjusted ROA 12.05% 9.08% 11.58% 10.75% -3.18%

Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).

Financial ratio Description The company
Adjusted current ratio A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities. Allergan Inc. adjusted current ratio improved from 2012 to 2013 and from 2013 to 2014.
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Allergan Inc. adjusted net profit margin ratio deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level.
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Allergan Inc. adjusted total asset turnover ratio deteriorated from 2012 to 2013 and from 2013 to 2014.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Allergan Inc. adjusted financial leverage ratio increased from 2012 to 2013 but then slightly decreased from 2013 to 2014 not reaching 2012 level.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Allergan Inc. adjusted ROE deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Allergan Inc. adjusted ROA deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level.

Allergan Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Current Ratio

Microsoft Excel
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
As Reported
Selected Financial Data (US$ in thousands)
Current assets 6,871,200 5,319,700 4,458,800 4,048,300 3,993,700
Current liabilities 1,557,300 1,244,300 1,095,200 955,000 1,528,400
Liquidity Ratio
Current ratio1 4.41 4.28 4.07 4.24 2.61
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted current assets 6,527,700 5,041,800 4,209,700 3,742,700 3,716,000
Current liabilities 1,557,300 1,244,300 1,095,200 955,000 1,528,400
Liquidity Ratio
Adjusted current ratio2 4.19 4.05 3.84 3.92 2.43

Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).

2014 Calculations

1 Current ratio = Current assets ÷ Current liabilities
= 6,871,200 ÷ 1,557,300 = 4.41

2 Adjusted current ratio = Adjusted current assets ÷ Current liabilities
= 6,527,700 ÷ 1,557,300 = 4.19

Liquidity ratio Description The company
Adjusted current ratio A liquidity ratio calculated as adjusted current assets divided by adjusted current liabilities. Allergan Inc. adjusted current ratio improved from 2012 to 2013 and from 2013 to 2014.

Adjusted Net Profit Margin

Microsoft Excel
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
As Reported
Selected Financial Data (US$ in thousands)
Net earnings attributable to Allergan, Inc. 1,524,200 985,100 1,098,800 934,500 600
Product net sales 7,126,100 6,197,500 5,708,800 5,347,100 4,819,600
Profitability Ratio
Net profit margin1 21.39% 15.90% 19.25% 17.48% 0.01%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net earnings attributable to Allergan, Inc. 1,444,400 923,600 1,010,500 865,600 (248,500)
Product net sales 7,126,100 6,197,500 5,708,800 5,347,100 4,819,600
Profitability Ratio
Adjusted net profit margin2 20.27% 14.90% 17.70% 16.19% -5.16%

Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).

2014 Calculations

1 Net profit margin = 100 × Net earnings attributable to Allergan, Inc. ÷ Product net sales
= 100 × 1,524,200 ÷ 7,126,100 = 21.39%

2 Adjusted net profit margin = 100 × Adjusted net earnings attributable to Allergan, Inc. ÷ Product net sales
= 100 × 1,444,400 ÷ 7,126,100 = 20.27%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Allergan Inc. adjusted net profit margin ratio deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level.

Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
As Reported
Selected Financial Data (US$ in thousands)
Product net sales 7,126,100 6,197,500 5,708,800 5,347,100 4,819,600
Total assets 12,415,700 10,574,300 9,179,300 8,508,600 8,308,100
Activity Ratio
Total asset turnover1 0.57 0.59 0.62 0.63 0.58
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Product net sales 7,126,100 6,197,500 5,708,800 5,347,100 4,819,600
Adjusted total assets 11,985,300 10,167,600 8,723,300 8,050,400 7,812,600
Activity Ratio
Adjusted total asset turnover2 0.59 0.61 0.65 0.66 0.62

Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).

2014 Calculations

1 Total asset turnover = Product net sales ÷ Total assets
= 7,126,100 ÷ 12,415,700 = 0.57

2 Adjusted total asset turnover = Product net sales ÷ Adjusted total assets
= 7,126,100 ÷ 11,985,300 = 0.59

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Allergan Inc. adjusted total asset turnover ratio deteriorated from 2012 to 2013 and from 2013 to 2014.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
As Reported
Selected Financial Data (US$ in thousands)
Total assets 12,415,700 10,574,300 9,179,300 8,508,600 8,308,100
Total Allergan, Inc. stockholders’ equity 7,753,000 6,463,200 5,837,100 5,309,600 4,757,700
Solvency Ratio
Financial leverage1 1.60 1.64 1.57 1.60 1.75
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted total assets 11,985,300 10,167,600 8,723,300 8,050,400 7,812,600
Adjusted total Allergan, Inc. stockholders’ equity 7,322,600 6,056,500 5,381,100 4,851,400 4,262,200
Solvency Ratio
Adjusted financial leverage2 1.64 1.68 1.62 1.66 1.83

Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).

2014 Calculations

1 Financial leverage = Total assets ÷ Total Allergan, Inc. stockholders’ equity
= 12,415,700 ÷ 7,753,000 = 1.60

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Allergan, Inc. stockholders’ equity
= 11,985,300 ÷ 7,322,600 = 1.64

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Allergan Inc. adjusted financial leverage ratio increased from 2012 to 2013 but then slightly decreased from 2013 to 2014 not reaching 2012 level.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
As Reported
Selected Financial Data (US$ in thousands)
Net earnings attributable to Allergan, Inc. 1,524,200 985,100 1,098,800 934,500 600
Total Allergan, Inc. stockholders’ equity 7,753,000 6,463,200 5,837,100 5,309,600 4,757,700
Profitability Ratio
ROE1 19.66% 15.24% 18.82% 17.60% 0.01%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net earnings attributable to Allergan, Inc. 1,444,400 923,600 1,010,500 865,600 (248,500)
Adjusted total Allergan, Inc. stockholders’ equity 7,322,600 6,056,500 5,381,100 4,851,400 4,262,200
Profitability Ratio
Adjusted ROE2 19.73% 15.25% 18.78% 17.84% -5.83%

Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).

2014 Calculations

1 ROE = 100 × Net earnings attributable to Allergan, Inc. ÷ Total Allergan, Inc. stockholders’ equity
= 100 × 1,524,200 ÷ 7,753,000 = 19.66%

2 Adjusted ROE = 100 × Adjusted net earnings attributable to Allergan, Inc. ÷ Adjusted total Allergan, Inc. stockholders’ equity
= 100 × 1,444,400 ÷ 7,322,600 = 19.73%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Allergan Inc. adjusted ROE deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2014 Dec 31, 2013 Dec 31, 2012 Dec 31, 2011 Dec 31, 2010
As Reported
Selected Financial Data (US$ in thousands)
Net earnings attributable to Allergan, Inc. 1,524,200 985,100 1,098,800 934,500 600
Total assets 12,415,700 10,574,300 9,179,300 8,508,600 8,308,100
Profitability Ratio
ROA1 12.28% 9.32% 11.97% 10.98% 0.01%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net earnings attributable to Allergan, Inc. 1,444,400 923,600 1,010,500 865,600 (248,500)
Adjusted total assets 11,985,300 10,167,600 8,723,300 8,050,400 7,812,600
Profitability Ratio
Adjusted ROA2 12.05% 9.08% 11.58% 10.75% -3.18%

Based on: 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31).

2014 Calculations

1 ROA = 100 × Net earnings attributable to Allergan, Inc. ÷ Total assets
= 100 × 1,524,200 ÷ 12,415,700 = 12.28%

2 Adjusted ROA = 100 × Adjusted net earnings attributable to Allergan, Inc. ÷ Adjusted total assets
= 100 × 1,444,400 ÷ 11,985,300 = 12.05%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Allergan Inc. adjusted ROA deteriorated from 2012 to 2013 but then improved from 2013 to 2014 exceeding 2012 level.