Name: Allergan PLC (NYSE:AGN) | Income Statement
Creator: Stock Analysis on Net

Income Statement

The income statement presents information on the financial results of a company business activities over a period of time. The income statement communicates how much revenue the company generated during a period and what cost it incurred in connection with generating that revenue.

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Allergan PLC, consolidated income statement

US$ in thousands

12 months ended:	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017	Dec 31, 2016	Dec 31, 2015
Net revenues	16,088,900)	15,787,400)	15,940,700)	14,570,600)	15,071,000)
Cost of sales, excludes amortization and impairment of acquired intangibles including product rights	(2,493,100)	(2,191,400)	(2,168,000)	(1,860,800)	(4,810,400)
Gross profit	13,595,800)	13,596,000)	13,772,700)	12,709,800)	10,260,600)
Research and development	(1,812,000)	(2,266,200)	(2,100,100)	(2,575,700)	(2,358,500)
Selling and marketing	(3,461,700)	(3,250,600)	(3,514,800)	(3,266,400)	(2,914,000)
General and administrative	(2,481,800)	(1,271,200)	(1,501,900)	(1,473,900)	(1,765,600)
Amortization	(5,856,600)	(6,552,300)	(7,197,100)	(6,470,400)	(5,453,400)
Goodwill impairments	(3,552,800)	(2,841,100)	—)	—)	—)
In-process research and development impairments	(436,000)	(804,600)	(1,452,300)	(743,900)	(511,600)
Asset sales and impairments, net	(440,200)	(2,857,600)	(3,927,700)	(5,000)	(272,000)
Operating loss	(4,445,300)	(6,247,600)	(5,921,200)	(1,825,500)	(3,014,500)
Interest income	76,800)	45,200)	67,700)	69,900)	11,400)
Interest expense	(783,000)	(911,200)	(1,095,600)	(1,295,600)	(1,193,300)
Teva Share Activity	—)	60,900)	(3,269,300)	—)	—)
Sale of businesses	—)	182,600)	—)	—)	—)
Debt extinguishment costs as part of the debt tender offer	—)	—)	(161,600)	—)	—)
Debt extinguishment other	(200)	15,600)	(27,600)	—)	—)
Other-than-temporary impairments	—)	—)	(26,100)	—)	—)
Dividend income	—)	—)	85,200)	68,200)	—)
Naurex recovery	—)	—)	20,000)	—)	—)
Forward sale of Teva shares	—)	—)	(62,900)	—)	—)
Pfizer termination fee, Allergan plc only	—)	—)	—)	150,000)	—)
Bridge loan commitment fee	—)	—)	—)	—)	(264,900)
Interest rate lock	—)	—)	—)	—)	31,000)
Other	33,000)	(2,400)	5,000)	1,000)	100)
Other income (expense), net	32,800)	256,700)	(3,437,300)	219,200)	(233,800)
Loss before income taxes and noncontrolling interest	(5,118,700)	(6,856,900)	(10,386,400)	(2,832,000)	(4,430,200)
(Provision) benefit for income taxes	(146,400)	1,770,700)	6,670,400)	1,897,000)	1,561,900)
Net loss from continuing operations, net of tax	(5,265,100)	(5,086,200)	(3,716,000)	(935,000)	(2,868,300)
Income (loss) from discontinued operations, net of tax	—)	—)	(402,900)	15,914,500)	6,787,700)
Net income (loss)	(5,265,100)	(5,086,200)	(4,118,900)	14,979,500)	3,919,400)
Income attributable to noncontrolling interest	(5,900)	(10,200)	(6,600)	(6,100)	(4,200)
Net income (loss) attributable to shareholders	(5,271,000)	(5,096,400)	(4,125,500)	14,973,400)	3,915,200)
Dividends on preferred shares	—)	(46,400)	(278,400)	(278,400)	(232,000)
Net income (loss) attributable to ordinary shareholders	(5,271,000)	(5,142,800)	(4,403,900)	14,695,000)	3,683,200)

Based on: 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).

Financial performance between 2015 and 2019 is characterized by stable top-line revenue growth contrasted with persistent operating losses and a transition from accounting gains to substantial net losses. While net revenues grew from 15.07 billion USD in 2015 to 16.09 billion USD in 2019, the bottom line shifted significantly due to non-cash charges and the cessation of gains from discontinued operations.

Revenue and Gross Profitability: Net revenues remained relatively stagnant, showing a marginal overall increase of approximately 6.8% over the five-year period. Gross profit exhibited a stronger upward trend initially, rising from 10.26 billion USD in 2015 to a peak of 13.77 billion USD in 2017, before plateauing around 13.60 billion USD in 2018 and 2019. This suggests an improvement in gross margins over time, as the cost of sales decreased relative to revenue.
Operating Expenses and Asset Impairments: Operating losses were recorded in every year of the analyzed period, driven largely by heavy non-cash expenses. Amortization remained a dominant cost, peaking at 7.20 billion USD in 2017. A notable shift occurred in 2018 and 2019, where goodwill impairments emerged as a significant drag on earnings, totaling 2.84 billion USD and 3.55 billion USD respectively. Additionally, a substantial asset impairment of 3.93 billion USD was recorded in 2017. General and administrative expenses remained relatively controlled until 2019, when they spiked to 2.48 billion USD from 1.27 billion USD in the prior year.
Net Income and Non-Operating Factors: The net income figures for 2015 and 2016 were positively skewed by significant gains from discontinued operations, which contributed 6.79 billion USD and 15.91 billion USD respectively. Without these one-time gains, the company would have reported losses in those years. From 2017 through 2019, the company experienced consistent net losses attributable to ordinary shareholders, widening to 5.27 billion USD by 2019. Interest expenses showed a gradual downward trend, decreasing from 1.19 billion USD in 2015 to 783 million USD in 2019, indicating a reduction in the cost of debt servicing.

In summary, the period was marked by a disconnect between stable revenue generation and net profitability. The company's financial results were heavily impacted by the amortization of acquired intangibles and escalating impairment charges, while the earlier periods of net profitability were reliant on the sale or disposal of business segments rather than core operating efficiency.

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