|
|
|
|
|
x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Michigan
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38-2799573
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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|
515 Eastern Avenue
Allegan, Michigan
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|
49010
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(Address of principal executive offices)
|
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(Zip Code)
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Large accelerated filer
|
T
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Accelerated filer
|
o
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|
|
|
|
Non-accelerated filer
|
o
(Do not check if a smaller reporting company)
|
Smaller reporting company
|
o
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|
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PAGE
NUMBER
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|
|
PART I. FINANCIAL INFORMATION
|
|
|
|
|
|
|
|
Condensed consolidated statements of income - For the three and six months end
ed December 29, 2012 and December 31, 2011
|
|
|
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|
|
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|
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PART II. OTHER INFORMATION
|
|
|
|
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|
|
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|
Item 1.
|
Financial Statements (Unaudited)
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
December 29,
2012 |
|
December 31,
2011 |
|
December 29,
2012 |
|
December 31,
2011 |
||||||||
|
|
|
|
|
|
|
|
||||||||
Net sales
|
$
|
882,959
|
|
|
$
|
838,170
|
|
|
$
|
1,652,769
|
|
|
$
|
1,563,465
|
|
Cost of sales
|
575,794
|
|
|
543,295
|
|
|
1,060,335
|
|
|
1,041,011
|
|
||||
Gross profit
|
307,165
|
|
|
294,875
|
|
|
592,434
|
|
|
522,454
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating expenses
|
|
|
|
|
|
|
|
||||||||
Distribution
|
11,699
|
|
|
9,095
|
|
|
22,466
|
|
|
19,359
|
|
||||
Research and development
|
28,323
|
|
|
31,148
|
|
|
55,718
|
|
|
50,786
|
|
||||
Selling and administration
|
103,286
|
|
|
93,964
|
|
|
193,820
|
|
|
190,089
|
|
||||
Total operating expenses
|
143,308
|
|
|
134,207
|
|
|
272,004
|
|
|
260,234
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating income
|
163,857
|
|
|
160,668
|
|
|
320,430
|
|
|
262,220
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Interest, net
|
15,314
|
|
|
15,641
|
|
|
31,167
|
|
|
28,211
|
|
||||
Other expense, net
|
76
|
|
|
752
|
|
|
14
|
|
|
981
|
|
||||
Loss on sale of investment
|
3,049
|
|
|
—
|
|
|
3,049
|
|
|
—
|
|
||||
Income before income taxes
|
145,418
|
|
|
144,275
|
|
|
286,200
|
|
|
233,028
|
|
||||
Income tax expense
|
39,463
|
|
|
44,536
|
|
|
74,665
|
|
|
62,831
|
|
||||
Net income
|
$
|
105,955
|
|
|
$
|
99,739
|
|
|
$
|
211,535
|
|
|
$
|
170,197
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share
|
$
|
1.13
|
|
|
$
|
1.07
|
|
|
$
|
2.26
|
|
|
$
|
1.83
|
|
Diluted earnings per share
|
$
|
1.12
|
|
|
$
|
1.06
|
|
|
$
|
2.24
|
|
|
$
|
1.81
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding
|
|
|
|
|
|
|
|
||||||||
Basic
|
93,903
|
|
|
93,221
|
|
|
93,755
|
|
|
93,066
|
|
||||
Diluted
|
94,450
|
|
|
94,043
|
|
|
94,408
|
|
|
93,983
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Dividends declared per share
|
$
|
0.09
|
|
|
$
|
0.08
|
|
|
$
|
0.17
|
|
|
$
|
0.15
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
December 29, 2012
|
|
December 31, 2011
|
|
December 29, 2012
|
|
December 31, 2011
|
||||||||
Net income
|
$
|
105,955
|
|
|
$
|
99,739
|
|
|
$
|
211,535
|
|
|
$
|
170,197
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Change in fair value of derivative financial instruments, net of tax
|
5,244
|
|
|
(1,496
|
)
|
|
6,706
|
|
|
(9,292
|
)
|
||||
Foreign currency translation adjustments
|
28,026
|
|
|
(12,851
|
)
|
|
33,450
|
|
|
(65,812
|
)
|
||||
Change in fair value of investment securities, net of tax
|
1,037
|
|
|
(933
|
)
|
|
1,037
|
|
|
(933
|
)
|
||||
Post-retirement liability adjustments, net of tax
|
—
|
|
|
(24
|
)
|
|
(41
|
)
|
|
(41
|
)
|
||||
Other comprehensive income (loss), net of tax
|
34,307
|
|
|
(15,304
|
)
|
|
41,152
|
|
|
(76,078
|
)
|
||||
Comprehensive income
|
$
|
140,262
|
|
|
$
|
84,435
|
|
|
$
|
252,687
|
|
|
$
|
94,119
|
|
|
December 29,
2012 |
|
June 30,
2012 |
|
December 31,
2011 |
||||||
Assets
|
|
|
|
|
|
||||||
Current assets
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
459,514
|
|
|
$
|
602,489
|
|
|
$
|
531,410
|
|
Accounts receivable, net
|
583,903
|
|
|
572,582
|
|
|
530,178
|
|
|||
Inventories
|
638,797
|
|
|
547,455
|
|
|
580,668
|
|
|||
Current deferred income taxes
|
44,813
|
|
|
45,738
|
|
|
47,216
|
|
|||
Income taxes refundable
|
4,323
|
|
|
1,047
|
|
|
4,111
|
|
|||
Prepaid expenses and other current assets
|
42,771
|
|
|
26,610
|
|
|
40,509
|
|
|||
Total current assets
|
1,774,121
|
|
|
1,795,921
|
|
|
1,734,092
|
|
|||
Property and equipment
|
1,192,787
|
|
|
1,118,837
|
|
|
1,066,307
|
|
|||
Less accumulated depreciation
|
(574,362
|
)
|
|
(540,487
|
)
|
|
(515,600
|
)
|
|||
|
618,425
|
|
|
578,350
|
|
|
550,707
|
|
|||
Goodwill and other indefinite-lived intangible assets
|
962,804
|
|
|
820,122
|
|
|
808,531
|
|
|||
Other intangible assets, net
|
845,666
|
|
|
729,253
|
|
|
752,595
|
|
|||
Non-current deferred income taxes
|
14,938
|
|
|
13,444
|
|
|
12,330
|
|
|||
Other non-current assets
|
78,382
|
|
|
86,957
|
|
|
84,299
|
|
|||
|
$
|
4,294,336
|
|
|
$
|
4,024,047
|
|
|
$
|
3,942,554
|
|
Liabilities and Shareholders’ Equity
|
|
|
|
|
|
||||||
Current liabilities
|
|
|
|
|
|
||||||
Accounts payable
|
$
|
321,205
|
|
|
$
|
317,341
|
|
|
$
|
324,349
|
|
Short-term debt
|
2,648
|
|
|
90
|
|
|
—
|
|
|||
Payroll and related taxes
|
71,081
|
|
|
89,934
|
|
|
71,059
|
|
|||
Accrued customer programs
|
122,651
|
|
|
116,055
|
|
|
116,888
|
|
|||
Accrued liabilities
|
65,981
|
|
|
76,406
|
|
|
85,661
|
|
|||
Accrued income taxes
|
11,299
|
|
|
12,905
|
|
|
28,684
|
|
|||
Current portion of long-term debt
|
40,000
|
|
|
40,000
|
|
|
40,000
|
|
|||
Total current liabilities
|
634,865
|
|
|
652,731
|
|
|
666,641
|
|
|||
Non-current liabilities
|
|
|
|
|
|
||||||
Long-term debt, less current portion
|
1,329,886
|
|
|
1,329,235
|
|
|
1,452,546
|
|
|||
Non-current deferred income taxes
|
47,481
|
|
|
24,126
|
|
|
9,163
|
|
|||
Other non-current liabilities
|
173,644
|
|
|
165,310
|
|
|
183,393
|
|
|||
Total non-current liabilities
|
1,551,011
|
|
|
1,518,671
|
|
|
1,645,102
|
|
|||
Shareholders’ Equity
|
|
|
|
|
|
||||||
Controlling interest:
|
|
|
|
|
|
||||||
Preferred stock, without par value, 10,000 shares authorized
|
—
|
|
|
—
|
|
|
—
|
|
|||
Common stock, without par value, 200,000 shares authorized
|
524,124
|
|
|
504,708
|
|
|
486,665
|
|
|||
Accumulated other comprehensive income
|
80,556
|
|
|
39,404
|
|
|
50,972
|
|
|||
Retained earnings
|
1,502,455
|
|
|
1,306,925
|
|
|
1,090,509
|
|
|||
|
2,107,135
|
|
|
1,851,037
|
|
|
1,628,146
|
|
|||
Noncontrolling interest
|
1,325
|
|
|
1,608
|
|
|
2,665
|
|
|||
Total shareholders’ equity
|
2,108,460
|
|
|
1,852,645
|
|
|
1,630,811
|
|
|||
|
$
|
4,294,336
|
|
|
$
|
4,024,047
|
|
|
$
|
3,942,554
|
|
Supplemental Disclosures of Balance Sheet Information
|
|
|
|
|
|
||||||
Allowance for doubtful accounts
|
$
|
2,473
|
|
|
$
|
2,556
|
|
|
$
|
8,993
|
|
Working capital
|
$
|
1,139,256
|
|
|
$
|
1,143,190
|
|
|
$
|
1,067,451
|
|
Preferred stock, shares issued and outstanding
|
—
|
|
|
—
|
|
|
—
|
|
|||
Common stock, shares issued and outstanding
|
93,980
|
|
|
93,484
|
|
|
93,287
|
|
|
Six Months Ended
|
||||||
|
December 29, 2012
|
|
December 31, 2011
|
||||
Cash Flows From (For) Operating Activities
|
|
|
|
||||
Net income
|
$
|
211,535
|
|
|
$
|
170,197
|
|
Adjustments to derive cash flows
|
|
|
|
||||
Gain on sale of pipeline development projects
|
—
|
|
|
(3,500
|
)
|
||
Loss on sale of investment
|
3,049
|
|
|
—
|
|
||
Depreciation and amortization
|
69,939
|
|
|
67,105
|
|
||
Share-based compensation
|
9,363
|
|
|
8,977
|
|
||
Income tax benefit from exercise of stock options
|
1,074
|
|
|
934
|
|
||
Excess tax benefit of stock transactions
|
(15,668
|
)
|
|
(11,215
|
)
|
||
Deferred income taxes
|
972
|
|
|
3,669
|
|
||
Subtotal
|
280,264
|
|
|
236,167
|
|
||
Changes in operating assets and liabilities, net of business acquisitions
|
|
|
|
||||
Accounts receivable
|
16,228
|
|
|
(10,657
|
)
|
||
Inventories
|
(44,980
|
)
|
|
(34,150
|
)
|
||
Accounts payable
|
(18,072
|
)
|
|
(14,319
|
)
|
||
Payroll and related taxes
|
(19,966
|
)
|
|
(12,012
|
)
|
||
Accrued customer programs
|
6,596
|
|
|
(1,412
|
)
|
||
Accrued liabilities
|
(7,156
|
)
|
|
16,300
|
|
||
Accrued income taxes
|
12,835
|
|
|
46,409
|
|
||
Other
|
3,854
|
|
|
(6,204
|
)
|
||
Subtotal
|
(50,661
|
)
|
|
(16,045
|
)
|
||
Net cash from operating activities
|
229,603
|
|
|
220,122
|
|
||
Cash Flows (For) From Investing Activities
|
|
|
|
||||
Acquisitions of businesses, net of cash acquired
|
(326,944
|
)
|
|
(547,052
|
)
|
||
Proceeds from sale of intangible assets and pipeline development projects
|
—
|
|
|
10,500
|
|
||
Additions to property and equipment
|
(39,279
|
)
|
|
(55,659
|
)
|
||
Acquisitions of assets
|
—
|
|
|
(750
|
)
|
||
Net cash for investing activities
|
(366,223
|
)
|
|
(592,961
|
)
|
||
Cash Flows (For) From Financing Activities
|
|
|
|
||||
Borrowings (repayments) of short-term debt, net
|
2,558
|
|
|
(2,770
|
)
|
||
Borrowings of long-term debt
|
40,651
|
|
|
1,087,546
|
|
||
Repayments of long-term debt
|
(40,000
|
)
|
|
(485,000
|
)
|
||
Deferred financing fees
|
(643
|
)
|
|
(5,097
|
)
|
||
Excess tax benefit of stock transactions
|
15,668
|
|
|
11,215
|
|
||
Issuance of common stock
|
7,617
|
|
|
7,699
|
|
||
Repurchase of common stock
|
(12,159
|
)
|
|
(7,954
|
)
|
||
Cash dividends
|
(16,005
|
)
|
|
(14,021
|
)
|
||
Net cash (for) from financing activities
|
(2,313
|
)
|
|
591,618
|
|
||
Effect of exchange rate changes on cash
|
(4,042
|
)
|
|
2,527
|
|
||
Net (decrease) increase in cash and cash equivalents
|
(142,975
|
)
|
|
221,306
|
|
||
Cash and cash equivalents, beginning of period
|
602,489
|
|
|
310,104
|
|
||
Cash and cash equivalents, end of period
|
$
|
459,514
|
|
|
$
|
531,410
|
|
|
|
|
|
||||
Supplemental Disclosures of Cash Flow Information
|
|
|
|
||||
Cash paid/received during the period for:
|
|
|
|
||||
Interest paid
|
$
|
29,244
|
|
|
$
|
22,861
|
|
Interest received
|
$
|
2,741
|
|
|
$
|
1,301
|
|
Income taxes paid
|
$
|
67,863
|
|
|
$
|
15,973
|
|
Income taxes refunded
|
$
|
1,155
|
|
|
$
|
802
|
|
Other assets
|
$
|
371
|
|
Goodwill
|
18,823
|
|
|
Other intangible assets - Exclusive technology agreements
|
51,122
|
|
|
Deferred tax liabilities
|
(18,823
|
)
|
|
Total purchase price
|
$
|
51,493
|
|
Cash
|
$
|
23
|
|
Accounts receivable
|
19,696
|
|
|
Inventory
|
37,689
|
|
|
Property and equipment
|
25,396
|
|
|
Deferred tax assets
|
1,508
|
|
|
Goodwill
|
68,229
|
|
|
Other intangible assets
|
147,450
|
|
|
Other assets
|
2,966
|
|
|
Total assets acquired
|
302,957
|
|
|
|
|
||
Accounts payable
|
13,733
|
|
|
Accrued expenses
|
4,224
|
|
|
Total liabilities assumed
|
17,957
|
|
|
Net assets acquired
|
$
|
285,000
|
|
Developed product technology
|
$
|
65,140
|
|
Trade name and trademarks
|
46,000
|
|
|
Favorable supply agreement
|
25,000
|
|
|
Customer relationships
|
10,000
|
|
|
Non-compete agreements
|
1,310
|
|
|
Total intangible assets acquired
|
$
|
147,450
|
|
Accounts receivable
|
$
|
3,568
|
|
Inventory
|
6,391
|
|
|
Property and equipment
|
91
|
|
|
Other assets
|
126
|
|
|
Deferred income tax assets
|
625
|
|
|
Goodwill
|
15,040
|
|
|
Other intangible assets
|
15,830
|
|
|
Total assets acquired
|
41,671
|
|
|
|
|
||
Accounts payable
|
2,237
|
|
|
Other current liabilities
|
420
|
|
|
Total liabilities assumed
|
2,657
|
|
|
Net assets acquired
|
$
|
39,014
|
|
Customer relationships
|
$
|
12,000
|
|
Developed product technology
|
1,600
|
|
|
Non-compete agreements
|
1,540
|
|
|
Trade name and trademarks
|
690
|
|
|
Total intangible assets acquired
|
$
|
15,830
|
|
|
Initial Valuation
|
Measurement Period Adjustments
|
Final Valuation
|
||||||
Accounts receivable
|
$
|
55,467
|
|
$
|
—
|
|
$
|
55,467
|
|
Inventory
|
57,540
|
|
—
|
|
57,540
|
|
|||
Property and equipment
|
33,200
|
|
—
|
|
33,200
|
|
|||
Other assets
|
1,743
|
|
—
|
|
1,743
|
|
|||
Deferred income tax assets
|
20,863
|
|
(344
|
)
|
20,519
|
|
|||
Goodwill
|
150,035
|
|
(1,170
|
)
|
148,865
|
|
|||
Other intangible assets
|
272,000
|
|
—
|
|
272,000
|
|
|||
Total assets acquired
|
590,848
|
|
(1,514
|
)
|
589,334
|
|
|||
|
|
|
|
||||||
Accounts payable
|
10,685
|
|
—
|
|
10,685
|
|
|||
Other current liabilities
|
2,386
|
|
—
|
|
2,386
|
|
|||
Accrued customer programs
|
26,926
|
|
(677
|
)
|
26,249
|
|
|||
Accrued expenses
|
3,799
|
|
—
|
|
3,799
|
|
|||
Total liabilities assumed
|
43,796
|
|
(677
|
)
|
43,119
|
|
|||
Net assets acquired
|
$
|
547,052
|
|
$
|
(837
|
)
|
$
|
546,215
|
|
Developed product technology
|
$
|
237,000
|
|
In-process research and development ("IPR&D")
|
35,000
|
|
|
Total intangible assets acquired
|
$
|
272,000
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
December 29,
2012 |
|
December 31,
2011 |
|
December 29,
2012 |
|
December 31,
2011 |
||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Net income
|
$
|
105,955
|
|
|
$
|
99,739
|
|
|
$
|
211,535
|
|
|
$
|
170,197
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator:
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding for basic EPS
|
93,903
|
|
|
93,221
|
|
|
93,755
|
|
|
93,066
|
|
||||
Dilutive effect of share-based awards
|
547
|
|
|
822
|
|
|
653
|
|
|
917
|
|
||||
Weighted average shares outstanding for diluted EPS
|
94,450
|
|
|
94,043
|
|
|
94,408
|
|
|
93,983
|
|
Level 1:
|
Quoted prices (unadjusted) in active markets for identical assets and liabilities.
|
Level 2:
|
Either direct or indirect inputs, other than quoted prices included within Level 1, which are observable for similar assets or liabilities.
|
Level 3:
|
Valuations derived from valuation techniques in which one or more significant inputs are unobservable.
|
|
Fair Value Measurements as of December 29, 2012 Using:
|
||||||||||||||
|
Total as of December 29, 2012
|
|
Quoted Prices
In Active
Markets
(Level 1)
|
|
Prices With
Other
Observable
Inputs
(Level 2)
|
|
Prices With
Unobservable
Inputs
(Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
376,471
|
|
|
$
|
376,471
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Investment securities
|
7,507
|
|
|
—
|
|
|
—
|
|
|
7,507
|
|
||||
Foreign currency forward contracts, net
|
7,492
|
|
|
—
|
|
|
7,492
|
|
|
—
|
|
||||
Funds associated with Israeli post employment benefits
|
16,059
|
|
|
—
|
|
|
16,059
|
|
|
—
|
|
||||
Total
|
$
|
407,529
|
|
|
$
|
376,471
|
|
|
$
|
23,551
|
|
|
$
|
7,507
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration
|
$
|
900
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
900
|
|
Interest rate swap agreements
|
13,819
|
|
|
—
|
|
|
13,819
|
|
|
—
|
|
||||
Total
|
$
|
14,719
|
|
|
$
|
—
|
|
|
$
|
13,819
|
|
|
$
|
900
|
|
Assets:
|
Investment
Securities
(Level 3)
|
||
Balance as of June 30, 2012
|
$
|
6,470
|
|
Unrealized gain on ARS
|
1,037
|
|
|
Balance as of December 29, 2012
|
$
|
7,507
|
|
|
|
||
Liabilities:
|
Contingent Consideration (Level 3)
|
||
Balance as of June 30, 2012
|
$
|
2,900
|
|
Payments
|
(2,000
|
)
|
|
Balance as of December 29, 2012
|
$
|
900
|
|
|
December 29,
2012 |
|
June 30,
2012 |
|
December 31,
2011 |
||||||
Finished goods
|
$
|
287,957
|
|
|
$
|
235,593
|
|
|
$
|
271,196
|
|
Work in process
|
172,745
|
|
|
154,238
|
|
|
157,203
|
|
|||
Raw materials
|
178,095
|
|
|
157,624
|
|
|
152,269
|
|
|||
Total inventories
|
$
|
638,797
|
|
|
$
|
547,455
|
|
|
$
|
580,668
|
|
|
Consumer
Healthcare
|
|
Nutritionals
|
|
Rx
Pharmaceuticals
|
|
API
|
|
Total
|
||||||||||
Balance as of June 30, 2012
|
$
|
138,910
|
|
|
$
|
331,744
|
|
|
$
|
220,769
|
|
|
$
|
86,334
|
|
|
$
|
777,757
|
|
Business acquisitions
|
68,229
|
|
|
—
|
|
|
18,823
|
|
|
—
|
|
|
87,052
|
|
|||||
Currency translation adjustment
|
2,258
|
|
|
—
|
|
|
3,343
|
|
|
3,894
|
|
|
9,495
|
|
|||||
Balance as of December 29, 2012
|
$
|
209,397
|
|
|
$
|
331,744
|
|
|
$
|
242,935
|
|
|
$
|
90,228
|
|
|
$
|
874,304
|
|
|
December 29, 2012
|
|
June 30, 2012
|
|
December 31, 2011
|
||||||||||||||||||
|
Gross
|
|
Accumulated
Amortization
|
|
Gross
|
|
Accumulated
Amortization
|
|
Gross
|
|
Accumulated
Amortization
|
||||||||||||
Amortizable intangibles:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Developed product technology/formulation and product rights
|
$
|
664,914
|
|
|
$
|
169,375
|
|
|
$
|
542,094
|
|
|
$
|
140,489
|
|
|
$
|
543,440
|
|
|
$
|
117,668
|
|
Customer relationships
|
352,655
|
|
|
62,107
|
|
|
341,363
|
|
|
50,757
|
|
|
329,126
|
|
|
41,021
|
|
||||||
Distribution, license and supply agreements
|
77,970
|
|
|
27,075
|
|
|
52,609
|
|
|
23,686
|
|
|
52,764
|
|
|
21,496
|
|
||||||
Non-compete agreements
|
9,172
|
|
|
4,772
|
|
|
7,804
|
|
|
3,778
|
|
|
6,241
|
|
|
2,986
|
|
||||||
Trademarks
|
4,994
|
|
|
710
|
|
|
4,797
|
|
|
704
|
|
|
4,891
|
|
|
696
|
|
||||||
Total
|
1,109,705
|
|
|
264,039
|
|
|
948,667
|
|
|
219,414
|
|
|
936,462
|
|
|
183,867
|
|
||||||
Non-amortizable intangibles:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
In-process research and development
|
35,000
|
|
|
—
|
|
|
35,000
|
|
|
—
|
|
|
35,000
|
|
|
—
|
|
||||||
Trade names and trademarks
|
53,500
|
|
|
—
|
|
|
7,365
|
|
|
—
|
|
|
6,591
|
|
|
—
|
|
||||||
Total other intangible assets
|
$
|
1,198,205
|
|
|
$
|
264,039
|
|
|
$
|
991,032
|
|
|
$
|
219,414
|
|
|
$
|
978,053
|
|
|
$
|
183,867
|
|
Fiscal Year
|
Amount
|
||
2013
(1)
|
$
|
48,000
|
|
2014
|
91,900
|
|
|
2015
|
90,700
|
|
|
2016
|
88,700
|
|
|
2017
|
86,200
|
|
|
December 29,
2012 |
|
June 30,
2012 |
|
December 31,
2011 |
||||||
Short-term debt:
|
|
|
|
|
|
||||||
Foreign line of credit
|
$
|
2,648
|
|
|
$
|
90
|
|
|
$
|
—
|
|
Current portion of long-term debt:
|
|
|
|
|
|
||||||
Term loans
|
40,000
|
|
|
40,000
|
|
|
40,000
|
|
|||
Total
|
42,648
|
|
|
40,090
|
|
|
40,000
|
|
|||
Long-term debt, less current portion:
|
|
|
|
|
|
||||||
Term loans
|
360,000
|
|
|
360,000
|
|
|
485,000
|
|
|||
Senior notes
|
965,000
|
|
|
965,000
|
|
|
965,000
|
|
|||
Other
|
4,886
|
|
|
4,235
|
|
|
2,546
|
|
|||
Total
|
1,329,886
|
|
|
1,329,235
|
|
|
1,452,546
|
|
|||
Total debt
|
$
|
1,372,534
|
|
|
$
|
1,369,325
|
|
|
$
|
1,492,546
|
|
|
Asset Derivatives
|
||||||||||||
|
Balance Sheet Presentation
|
|
Fair Value
|
||||||||||
|
|
|
December 29,
2012 |
|
June 30,
2012 |
|
December 31,
2011 |
||||||
Hedging derivatives:
|
|
|
|
|
|
|
|
||||||
Foreign currency forward contracts
|
Other current assets
|
|
$
|
6,712
|
|
|
$
|
578
|
|
|
$
|
1,015
|
|
Total hedging derivatives
|
|
|
$
|
6,712
|
|
|
$
|
578
|
|
|
$
|
1,015
|
|
Non-hedging derivatives:
|
|
|
|
|
|
|
|
||||||
Foreign currency forward contracts
|
Other current assets
|
|
$
|
1,063
|
|
|
$
|
54
|
|
|
$
|
31
|
|
Total non-hedging derivatives
|
|
|
$
|
1,063
|
|
|
$
|
54
|
|
|
$
|
31
|
|
|
|
|
|
|
|
|
|
||||||
|
Liability Derivatives
|
||||||||||||
|
Balance Sheet Presentation
|
|
Fair Value
|
||||||||||
|
|
|
December 29,
2012 |
|
June 30,
2012 |
|
December 31,
2011 |
||||||
Hedging derivatives:
|
|
|
|
|
|
|
|
||||||
Foreign currency forward contracts
|
Accrued liabilities
|
|
$
|
264
|
|
|
$
|
5,585
|
|
|
$
|
6,219
|
|
Interest rate swap agreements
|
Other non-current liabilities
|
|
13,819
|
|
|
14,706
|
|
|
13,433
|
|
|||
Total hedging derivatives
|
|
|
$
|
14,083
|
|
|
$
|
20,291
|
|
|
$
|
19,652
|
|
Non-hedging derivatives:
|
|
|
|
|
|
|
|
||||||
Foreign currency forward contracts
|
Accrued liabilities
|
|
$
|
19
|
|
|
$
|
614
|
|
|
$
|
784
|
|
Total non-hedging derivatives
|
|
|
$
|
19
|
|
|
$
|
614
|
|
|
$
|
784
|
|
Derivatives in Cash Flow
Hedging Relationships
|
|
Amount of Gain/(Loss)
Recognized in OCI
on Derivative
(Effective Portion)
|
|
Location and Amount of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
|
|
Location and Amount of Gain/(Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
|
||||||||||||||||||||
|
|
December 29, 2012
|
|
December 31, 2011
|
|
|
December 29, 2012
|
|
December 31, 2011
|
|
|
December 29, 2012
|
|
December 31, 2011
|
||||||||||||
T-Locks
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Interest, net
|
$
|
91
|
|
|
$
|
91
|
|
|
Interest, net
|
$
|
—
|
|
|
$
|
—
|
|
Interest rate swap agreements
|
|
1,300
|
|
|
940
|
|
|
Interest, net
|
(1,229
|
)
|
|
(1,269
|
)
|
|
Interest, net
|
—
|
|
|
—
|
|
||||||
Foreign currency forward contracts
|
|
7,013
|
|
|
(3,859
|
)
|
|
Net sales
|
(186
|
)
|
|
262
|
|
|
Net sales
|
—
|
|
|
—
|
|
||||||
|
|
|
|
|
|
Cost of sales
|
(1,429
|
)
|
|
825
|
|
|
Cost of sales
|
(74
|
)
|
|
—
|
|
||||||||
|
|
|
|
|
|
Interest, net
|
21
|
|
|
24
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
Other income (expense), net
|
1,592
|
|
|
(1,571
|
)
|
|
|
|
|
|
||||||||||
Total
|
|
$
|
8,313
|
|
|
$
|
(2,919
|
)
|
|
|
$
|
(1,140
|
)
|
|
$
|
(1,638
|
)
|
|
|
$
|
(74
|
)
|
|
$
|
—
|
|
Derivatives in Cash Flow
Hedging Relationships
|
|
Amount of Gain/(Loss)
Recognized in OCI
on Derivative
(Effective Portion)
|
|
Location and Amount of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion)
|
|
Location and Amount of Gain/(Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
|
||||||||||||||||||||
|
|
December 29, 2012
|
|
December 31, 2011
|
|
|
December 29, 2012
|
|
December 31, 2011
|
|
|
December 29, 2012
|
|
December 31, 2011
|
||||||||||||
T-Locks
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Interest, net
|
$
|
182
|
|
|
$
|
182
|
|
|
Interest, net
|
$
|
—
|
|
|
$
|
—
|
|
Interest rate swap agreements
|
|
900
|
|
|
(5,885
|
)
|
|
Interest, net
|
(2,443
|
)
|
|
(2,090
|
)
|
|
Interest, net
|
—
|
|
|
—
|
|
||||||
Foreign currency forward contracts
|
|
6,941
|
|
|
(8,128
|
)
|
|
Net sales
|
(270
|
)
|
|
(151
|
)
|
|
Net sales
|
—
|
|
|
(20
|
)
|
||||||
|
|
|
|
|
|
Cost of sales
|
(3,104
|
)
|
|
2,354
|
|
|
Cost of sales
|
(65
|
)
|
|
687
|
|
||||||||
|
|
|
|
|
|
Interest, net
|
65
|
|
|
34
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
Other income (expense), net
|
1,141
|
|
|
(2,406
|
)
|
|
|
|
|
|
||||||||||
Total
|
|
$
|
7,841
|
|
|
$
|
(14,013
|
)
|
|
|
$
|
(4,429
|
)
|
|
$
|
(2,077
|
)
|
|
|
$
|
(65
|
)
|
|
$
|
667
|
|
|
Consumer
Healthcare
|
|
Nutritionals
|
|
Rx
Pharmaceuticals
|
|
API
|
|
Other
|
|
Unallocated
expenses
|
|
Total
|
||||||||||||||
Three Months Ended December 29, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net sales
|
$
|
539,288
|
|
|
$
|
121,938
|
|
|
$
|
162,541
|
|
|
$
|
40,854
|
|
|
$
|
18,338
|
|
|
$
|
—
|
|
|
$
|
882,959
|
|
Operating income
|
$
|
86,078
|
|
|
$
|
7,160
|
|
|
$
|
64,059
|
|
|
$
|
13,820
|
|
|
$
|
663
|
|
|
$
|
(7,923
|
)
|
|
$
|
163,857
|
|
Amortization of intangibles
|
$
|
4,870
|
|
|
$
|
7,310
|
|
|
$
|
8,457
|
|
|
$
|
481
|
|
|
$
|
407
|
|
|
$
|
—
|
|
|
$
|
21,525
|
|
Total assets
|
$
|
1,771,480
|
|
|
$
|
960,652
|
|
|
$
|
1,184,864
|
|
|
$
|
275,428
|
|
|
$
|
101,912
|
|
|
$
|
—
|
|
|
$
|
4,294,336
|
|
Three Months Ended December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net sales
|
$
|
471,277
|
|
|
$
|
128,147
|
|
|
$
|
177,196
|
|
|
$
|
42,752
|
|
|
$
|
18,798
|
|
|
$
|
—
|
|
|
$
|
838,170
|
|
Operating income
|
$
|
82,250
|
|
|
$
|
4,552
|
|
|
$
|
69,974
|
|
|
$
|
11,693
|
|
|
$
|
924
|
|
|
$
|
(8,725
|
)
|
|
$
|
160,668
|
|
Amortization of intangibles
|
$
|
2,220
|
|
|
$
|
6,637
|
|
|
$
|
7,969
|
|
|
$
|
496
|
|
|
$
|
438
|
|
|
$
|
—
|
|
|
$
|
17,760
|
|
Total assets
|
$
|
1,575,062
|
|
|
$
|
962,947
|
|
|
$
|
1,033,577
|
|
|
$
|
255,284
|
|
|
$
|
115,684
|
|
|
$
|
—
|
|
|
$
|
3,942,554
|
|
|
Consumer
Healthcare
|
|
Nutritionals
|
|
Rx
Pharmaceuticals
|
|
API
|
|
Other
|
|
Unallocated
expenses
|
|
Total
|
||||||||||||||
Six Months Ended December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net sales
|
$
|
989,704
|
|
|
$
|
225,361
|
|
|
$
|
325,483
|
|
|
$
|
77,273
|
|
|
$
|
34,948
|
|
|
$
|
—
|
|
|
$
|
1,652,769
|
|
Operating income
|
$
|
165,366
|
|
|
$
|
11,043
|
|
|
$
|
132,563
|
|
|
$
|
27,139
|
|
|
$
|
1,088
|
|
|
$
|
(16,769
|
)
|
|
$
|
320,430
|
|
Amortization of intangibles
|
$
|
7,133
|
|
|
$
|
14,610
|
|
|
$
|
16,859
|
|
|
$
|
944
|
|
|
$
|
800
|
|
|
$
|
—
|
|
|
$
|
40,346
|
|
Six Months Ended December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net sales
|
$
|
882,958
|
|
|
$
|
248,008
|
|
|
$
|
304,823
|
|
|
$
|
90,396
|
|
|
$
|
37,280
|
|
|
$
|
—
|
|
|
$
|
1,563,465
|
|
Operating income
|
$
|
151,439
|
|
|
$
|
11,793
|
|
|
$
|
94,459
|
|
|
$
|
25,908
|
|
|
$
|
1,209
|
|
|
$
|
(22,588
|
)
|
|
$
|
262,220
|
|
Amortization of intangibles
|
$
|
4,465
|
|
|
$
|
16,102
|
|
|
$
|
15,322
|
|
|
$
|
1,017
|
|
|
$
|
875
|
|
|
$
|
—
|
|
|
$
|
37,781
|
|
|
Fiscal 2012 Restructuring Employee Termination
|
||
Balance at March 31, 2012
|
$
|
783
|
|
Additions
|
965
|
|
|
Payments
|
(87
|
)
|
|
Balance at June 30, 2012
|
1,661
|
|
|
Payments
|
(1,643
|
)
|
|
Balance at December 29, 2012
|
$
|
18
|
|
Item 2.
|
|
•
|
The Consumer Healthcare segment is the world’s largest store brand manufacturer of over-the-counter ("OTC") pharmaceutical products. This business markets products that are comparable in quality and effectiveness to national brand products. Major product categories include analgesics, cough/cold/allergy/sinus, gastrointestinal, smoking cessation, and secondary product categories that include feminine hygiene, diabetes care and dermatological care. In addition, the recent acquisition of Sergeant's Pet Care Products, Inc. ("Sergeant's"), which closed in the Company's second fiscal quarter, expanded the Company's product portfolio into the pet healthcare category. The cost to the retailer of a store brand product is significantly lower than that of a comparable nationally advertised brand-name product. Generally the retailers’ dollar profit per unit of store brand product is greater than the dollar profit per unit of the comparable national brand product. The retailer, therefore, can price a store brand product below the competing national brand product and realize a greater profit margin. The consumer benefits by receiving a high quality product at a price below the comparable national brand product. Therefore, the Company's business model saves consumers on their annual healthcare spending. The Company, one of the original architects of private label pharmaceuticals, is the market leader for consumer healthcare products in many of the geographies where it currently competes – the U.S., U.K., and Mexico – and is developing a leadership position in Australia. The Company's market share of OTC store brand products has grown in recent years as new products, retailer efforts to increase consumer education and awareness, and economic events have directed consumers to the value of store brand product offerings.
|
•
|
The Nutritionals segment develops, manufactures, markets and distributes store brand infant and toddler formula products, infant and toddler foods, vitamin, mineral and dietary supplement ("VMS") products, and oral electrolyte solution products to retailers and consumers primarily in the U.S., Canada, Mexico and China. Similar to the Consumer Healthcare segment, this business markets products that are comparable in quality and effectiveness to the national brand products. The cost to the retailer of a store brand product is significantly lower than that of a
|
•
|
The Rx Pharmaceuticals segment develops, manufactures and markets a portfolio of generic prescription ("Rx") drugs for the U.S. market. The Company defines this portfolio as predominantly “extended topical” and specialty as it encompasses a broad array of topical dosage forms such as creams, ointments, lotions, gels, shampoos, foams, suppositories, sprays, liquids, suspensions, solutions and powders. The portfolio also includes select controlled substances, injectables, hormones, oral liquids and oral solid dosage forms. The strategy in the Rx Pharmaceuticals segment is to be the first to market with those new products that are exposed to less competition because they have formulations that are more difficult and costly to develop and launch (e.g., extended topicals or products containing controlled substances). In addition, the Rx Pharmaceuticals segment offers OTC products through the prescription channel (referred to as “ORx®” marketing). ORx® products are OTC products that are available for pharmacy fulfillment and healthcare reimbursement when prescribed by a physician. The Company offers over 100 ORx® products that are reimbursable through many health plans and Medicaid and Medicare programs. ORx® products offer consumers safe and effective remedies that provide an affordable alternative to the higher out-of-pocket costs of traditional OTC products.
|
•
|
The API segment develops, manufactures and markets active pharmaceutical ingredients ("API") used worldwide by the generic drug industry and branded pharmaceutical companies. API development is focused on the synthesis of less common molecules for the U.S., European and other international markets. The Company is also focusing development activities on the synthesis of molecules for use in its own OTC and Rx pipeline products. This segment is undergoing a strategic platform transformation, moving certain production from Israel to the acquired API manufacturing facility in India to allow for lower cost production and to create space for other, more complex production in Israel.
|
|
Three Months Ended
|
|
Increase/(Decrease)
|
|
% Change
|
|||||||||
|
December 29,
2012 |
|
December 31,
2011 |
|
|
|||||||||
Net sales
|
$
|
882,959
|
|
|
$
|
838,170
|
|
|
$
|
44,789
|
|
|
5.3
|
%
|
Gross profit
|
$
|
307,165
|
|
|
$
|
294,875
|
|
|
$
|
12,290
|
|
|
4.2
|
%
|
Gross profit %
|
34.8
|
%
|
|
35.2
|
%
|
|
(0.4
|
)%
|
|
|
|
|||
Operating expenses
|
$
|
143,308
|
|
|
$
|
134,207
|
|
|
$
|
9,101
|
|
|
6.8
|
%
|
Operating expenses %
|
16.2
|
%
|
|
16.0
|
%
|
|
0.2
|
%
|
|
|
|
|||
Operating income
|
$
|
163,857
|
|
|
$
|
160,668
|
|
|
$
|
3,189
|
|
|
2.0
|
%
|
Operating income %
|
18.6
|
%
|
|
19.2
|
%
|
|
(0.6
|
)%
|
|
|
|
|||
Interest and other expense, net
|
$
|
18,439
|
|
|
$
|
16,393
|
|
|
$
|
2,046
|
|
|
12.5
|
%
|
Income taxes
|
$
|
39,463
|
|
|
$
|
44,536
|
|
|
$
|
(5,073
|
)
|
|
(11.4
|
)%
|
Net income
|
$
|
105,955
|
|
|
$
|
99,739
|
|
|
$
|
6,216
|
|
|
6.2
|
%
|
|
Six Months Ended
|
|
Increase/(Decrease)
|
|
% Change
|
|||||||||
|
December 29,
2012 |
|
December 31,
2011 |
|
|
|||||||||
Net sales
|
$
|
1,652,769
|
|
|
$
|
1,563,465
|
|
|
$
|
89,304
|
|
|
5.7
|
%
|
Gross profit
|
$
|
592,434
|
|
|
$
|
522,454
|
|
|
$
|
69,980
|
|
|
13.4
|
%
|
Gross profit %
|
35.8
|
%
|
|
33.4
|
%
|
|
2.4
|
%
|
|
|
|
|||
Operating expenses
|
$
|
272,004
|
|
|
$
|
260,234
|
|
|
$
|
11,770
|
|
|
4.5
|
%
|
Operating expenses %
|
16.5
|
%
|
|
16.6
|
%
|
|
(0.1
|
)%
|
|
|
|
|||
Operating income
|
$
|
320,430
|
|
|
$
|
262,220
|
|
|
$
|
58,210
|
|
|
22.2
|
%
|
Operating income %
|
19.4
|
%
|
|
16.8
|
%
|
|
2.6
|
%
|
|
|
|
|||
Interest and other expense, net
|
$
|
34,230
|
|
|
$
|
29,192
|
|
|
$
|
5,038
|
|
|
17.3
|
%
|
Income taxes
|
$
|
74,665
|
|
|
$
|
62,831
|
|
|
$
|
11,834
|
|
|
18.8
|
%
|
Net income
|
$
|
211,535
|
|
|
$
|
170,197
|
|
|
$
|
41,338
|
|
|
24.3
|
%
|
|
Three Months Ended
|
|
Increase/(Decrease)
|
|
% Change
|
|||||||||
|
December 29, 2012
|
|
December 31, 2011
|
|
|
|||||||||
Net sales
|
$
|
539,288
|
|
|
$
|
471,277
|
|
|
$
|
68,011
|
|
|
14.4
|
%
|
Gross profit
|
$
|
162,254
|
|
|
$
|
148,813
|
|
|
$
|
13,441
|
|
|
9.0
|
%
|
Gross profit %
|
30.1
|
%
|
|
31.6
|
%
|
|
(1.5
|
)%
|
|
|
||||
Operating expenses
|
$
|
76,176
|
|
|
$
|
66,563
|
|
|
$
|
9,613
|
|
|
14.4
|
%
|
Operating expenses %
|
14.1
|
%
|
|
14.1
|
%
|
|
—
|
%
|
|
|
||||
Operating income
|
$
|
86,078
|
|
|
$
|
82,250
|
|
|
$
|
3,828
|
|
|
4.7
|
%
|
Operating income %
|
16.0
|
%
|
|
17.5
|
%
|
|
(1.5
|
)%
|
|
|
|
Six Months Ended
|
|
Increase/(Decrease)
|
|
% Change
|
|||||||||
|
December 29, 2012
|
|
December 31, 2011
|
|
|
|||||||||
Net sales
|
$
|
989,704
|
|
|
$
|
882,958
|
|
|
$
|
106,746
|
|
|
12.1
|
%
|
Gross profit
|
$
|
308,089
|
|
|
$
|
278,171
|
|
|
$
|
29,918
|
|
|
10.8
|
%
|
Gross profit %
|
31.1
|
%
|
|
31.5
|
%
|
|
(0.4
|
)%
|
|
|
||||
Operating expenses
|
$
|
142,723
|
|
|
$
|
126,732
|
|
|
$
|
15,991
|
|
|
12.6
|
%
|
Operating expenses %
|
14.4
|
%
|
|
14.4
|
%
|
|
—
|
%
|
|
|
||||
Operating income
|
$
|
165,366
|
|
|
$
|
151,439
|
|
|
$
|
13,927
|
|
|
9.2
|
%
|
Operating income %
|
16.7
|
%
|
|
17.2
|
%
|
|
(0.5
|
)%
|
|
|
|
Three Months Ended
|
|
Increase/(Decrease)
|
|
% Change
|
|||||||||
|
December 29, 2012
|
|
December 31, 2011
|
|
|
|||||||||
Net sales
|
$
|
121,938
|
|
|
$
|
128,147
|
|
|
$
|
(6,209
|
)
|
|
(4.8
|
)%
|
Gross profit
|
$
|
30,145
|
|
|
$
|
28,230
|
|
|
$
|
1,915
|
|
|
6.8
|
%
|
Gross profit %
|
24.7
|
%
|
|
22.0
|
%
|
|
2.7
|
%
|
|
|
||||
Operating expenses
|
$
|
22,985
|
|
|
$
|
23,678
|
|
|
$
|
(693
|
)
|
|
(2.9
|
)%
|
Operating expenses %
|
18.8
|
%
|
|
18.5
|
%
|
|
0.3
|
%
|
|
|
||||
Operating income
|
$
|
7,160
|
|
|
$
|
4,552
|
|
|
$
|
2,608
|
|
|
57.3
|
%
|
Operating income %
|
5.9
|
%
|
|
3.6
|
%
|
|
2.3
|
%
|
|
|
|
Six Months Ended
|
|
Increase/(Decrease)
|
|
% Change
|
|||||||||
|
December 29, 2012
|
|
December 31, 2011
|
|
|
|||||||||
Net sales
|
$
|
225,361
|
|
|
$
|
248,008
|
|
|
$
|
(22,647
|
)
|
|
(9.1
|
)%
|
Gross profit
|
$
|
55,980
|
|
|
$
|
57,799
|
|
|
$
|
(1,819
|
)
|
|
(3.1
|
)%
|
Gross profit %
|
24.8
|
%
|
|
23.3
|
%
|
|
1.5
|
%
|
|
|
||||
Operating expenses
|
$
|
44,937
|
|
|
$
|
46,006
|
|
|
$
|
(1,069
|
)
|
|
(2.3
|
)%
|
Operating expenses %
|
19.9
|
%
|
|
18.6
|
%
|
|
1.3
|
%
|
|
|
||||
Operating income
|
$
|
11,043
|
|
|
$
|
11,793
|
|
|
$
|
(750
|
)
|
|
(6.4
|
)%
|
Operating income %
|
4.9
|
%
|
|
4.8
|
%
|
|
0.1
|
%
|
|
|
|
Three Months Ended
|
|
Increase/(Decrease)
|
|
% Change
|
|||||||||
|
December 29, 2012
|
|
December 31, 2011
|
|
|
|||||||||
Net sales
|
$
|
162,541
|
|
|
$
|
177,196
|
|
|
$
|
(14,655
|
)
|
|
(8.3
|
)%
|
Gross profit
|
$
|
86,036
|
|
|
$
|
91,378
|
|
|
$
|
(5,342
|
)
|
|
(5.8
|
)%
|
Gross profit %
|
52.9
|
%
|
|
51.6
|
%
|
|
1.3
|
%
|
|
|
||||
Operating expenses
|
$
|
21,977
|
|
|
$
|
21,404
|
|
|
$
|
573
|
|
|
2.7
|
%
|
Operating expenses %
|
13.5
|
%
|
|
12.1
|
%
|
|
1.4
|
%
|
|
|
||||
Operating income
|
$
|
64,059
|
|
|
$
|
69,974
|
|
|
$
|
(5,915
|
)
|
|
(8.5
|
)%
|
Operating income %
|
39.4
|
%
|
|
39.5
|
%
|
|
(0.1
|
)%
|
|
|
|
Six Months Ended
|
|
Increase/(Decrease)
|
|
% Change
|
|||||||||
|
December 29, 2012
|
|
December 31, 2011
|
|
|
|||||||||
Net sales
|
$
|
325,483
|
|
|
$
|
304,823
|
|
|
$
|
20,660
|
|
|
6.8
|
%
|
Gross profit
|
$
|
172,720
|
|
|
$
|
132,838
|
|
|
$
|
39,882
|
|
|
30.0
|
%
|
Gross profit %
|
53.1
|
%
|
|
43.6
|
%
|
|
9.5
|
%
|
|
|
||||
Operating expenses
|
$
|
40,157
|
|
|
$
|
38,379
|
|
|
$
|
1,778
|
|
|
4.6
|
%
|
Operating expenses %
|
12.3
|
%
|
|
12.6
|
%
|
|
(0.3
|
)%
|
|
|
||||
Operating income
|
$
|
132,563
|
|
|
$
|
94,459
|
|
|
$
|
38,104
|
|
|
40.3
|
%
|
Operating income %
|
40.7
|
%
|
|
31.0
|
%
|
|
9.7
|
%
|
|
|
|
Three Months Ended
|
|
Increase/(Decrease)
|
|
% Change
|
|||||||||
|
December 29, 2012
|
|
December 31, 2011
|
|
|
|||||||||
Net sales
|
$
|
40,854
|
|
|
$
|
42,752
|
|
|
$
|
(1,898
|
)
|
|
(4.4
|
)%
|
Gross profit
|
$
|
22,883
|
|
|
$
|
20,151
|
|
|
$
|
2,732
|
|
|
13.6
|
%
|
Gross profit %
|
56.0
|
%
|
|
47.1
|
%
|
|
8.9
|
%
|
|
|
||||
Operating expenses
|
$
|
9,063
|
|
|
$
|
8,458
|
|
|
$
|
605
|
|
|
7.2
|
%
|
Operating expenses %
|
22.2
|
%
|
|
19.8
|
%
|
|
2.4
|
%
|
|
|
||||
Operating income
|
$
|
13,820
|
|
|
$
|
11,693
|
|
|
$
|
2,127
|
|
|
18.2
|
%
|
Operating income %
|
33.8
|
%
|
|
27.4
|
%
|
|
6.4
|
%
|
|
|
|
Six Months Ended
|
|
Increase/(Decrease)
|
|
% Change
|
|||||||||
|
December 29, 2012
|
|
December 31, 2011
|
|
|
|||||||||
Net sales
|
$
|
77,273
|
|
|
$
|
90,396
|
|
|
$
|
(13,123
|
)
|
|
(14.5
|
)%
|
Gross profit
|
$
|
44,243
|
|
|
$
|
41,759
|
|
|
$
|
2,484
|
|
|
5.9
|
%
|
Gross profit %
|
57.3
|
%
|
|
46.2
|
%
|
|
11.1
|
%
|
|
|
||||
Operating expenses
|
$
|
17,104
|
|
|
$
|
15,851
|
|
|
$
|
1,253
|
|
|
7.9
|
%
|
Operating expenses %
|
22.1
|
%
|
|
17.5
|
%
|
|
4.6
|
%
|
|
|
||||
Operating income
|
$
|
27,139
|
|
|
$
|
25,908
|
|
|
$
|
1,231
|
|
|
4.8
|
%
|
Operating income %
|
35.1
|
%
|
|
28.7
|
%
|
|
6.4
|
%
|
|
|
|
Three Months Ended
|
|
Increase/(Decrease)
|
|
% Change
|
|||||||||
|
December 29, 2012
|
|
December 31, 2011
|
|
|
|||||||||
Net sales
|
$
|
18,338
|
|
|
$
|
18,798
|
|
|
$
|
(460
|
)
|
|
(2.4
|
)%
|
Gross profit
|
$
|
5,847
|
|
|
$
|
6,303
|
|
|
$
|
(456
|
)
|
|
(7.2
|
)%
|
Gross profit %
|
31.9
|
%
|
|
33.5
|
%
|
|
(1.6
|
)%
|
|
|
||||
Operating expenses
|
$
|
5,184
|
|
|
$
|
5,379
|
|
|
$
|
(195
|
)
|
|
(3.6
|
)%
|
Operating expenses %
|
28.3
|
%
|
|
28.6
|
%
|
|
(0.3
|
)%
|
|
|
||||
Operating income
|
$
|
663
|
|
|
$
|
924
|
|
|
$
|
(261
|
)
|
|
(28.2
|
)%
|
Operating income %
|
3.6
|
%
|
|
4.9
|
%
|
|
(1.3
|
)%
|
|
|
|
Six Months Ended
|
|
Increase/(Decrease)
|
|
% Change
|
|||||||||
|
December 29, 2012
|
|
December 31, 2011
|
|
|
|||||||||
Net sales
|
$
|
34,948
|
|
|
$
|
37,280
|
|
|
$
|
(2,332
|
)
|
|
(6.3
|
)%
|
Gross profit
|
$
|
11,402
|
|
|
$
|
11,887
|
|
|
$
|
(485
|
)
|
|
(4.1
|
)%
|
Gross profit %
|
32.6
|
%
|
|
31.9
|
%
|
|
0.7
|
%
|
|
|
||||
Operating expenses
|
$
|
10,314
|
|
|
$
|
10,678
|
|
|
$
|
(364
|
)
|
|
(3.4
|
)%
|
Operating expenses %
|
29.5
|
%
|
|
28.6
|
%
|
|
0.9
|
%
|
|
|
||||
Operating income
|
$
|
1,088
|
|
|
$
|
1,209
|
|
|
$
|
(121
|
)
|
|
(10.0
|
)%
|
Operating income %
|
3.1
|
%
|
|
3.2
|
%
|
|
(0.1
|
)%
|
|
|
|
Six Months Ended
|
||||||
|
December 29, 2012
|
|
December 31, 2011
|
||||
Net cash from operating activities
|
$
|
229,603
|
|
|
$
|
220,122
|
|
|
|
|
|
||||
Net cash for investing activities
|
$
|
(366,223
|
)
|
|
$
|
(592,961
|
)
|
|
|
|
|
||||
Net cash (for) from financing activities
|
$
|
(2,313
|
)
|
|
$
|
591,618
|
|
|
|
|
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk (in thousands)
|
Item 4.
|
Controls and Procedures
|
Item 1.
|
Legal Proceedings
|
Item 6.
|
Exhibits
|
Exhibit
Number
|
|
Description
|
|
|
|
10.1
|
|
Amendment to the Nonqualified Deferred Compensation Plan, dated as of October 10, 2012.
|
|
|
|
10.2
|
|
Second Amendment, dated November 20, 2012, to the Credit Agreement dated October 26, 2011, among Perrigo Company and certain of its subsidiaries, JPMorgan Chase Bank, N.A , as Administrative Agent, certain other participant banks, and the lender parties therein listed, incorporated by reference from Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on November 21, 2012.
|
|
|
|
31
|
|
Rule 13a-14(a) Certifications.
|
|
|
|
32
|
|
Section 1350 Certifications.
|
|
|
|
101.INS
|
|
XBRL Instance Document.
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
|
PERRIGO COMPANY
|
|
|
|
(Registrant)
|
|
|
|
|
Date:
|
February 1, 2013
|
|
By: /s/ Joseph C. Papa
|
|
|
|
Joseph C. Papa
|
|
|
|
Chairman, President and Chief Executive Officer
|
|
|
|
|
Date:
|
February 1, 2013
|
|
By: /s/ Judy L. Brown
|
|
|
|
Judy L. Brown
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
(Principal Accounting and Financial Officer)
|
Exhibit
Number
|
|
Description
|
|
|
|
10.1
|
|
Amendment to the Nonqualified Deferred Compensation Plan, dated as of October 10, 2012.
|
|
|
|
10.2
|
|
Second Amendment, dated November 20, 2012, to the Credit Agreement dated October 26, 2011, among Perrigo Company and certain of its subsidiaries, JPMorgan Chase Bank, N.A , as Administrative Agent, certain other participant banks, and the lender parties therein listed, incorporated by reference from Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on November 21, 2012.
|
|
|
|
31
|
|
Rule 13a-14(a) Certifications.
|
|
|
|
32
|
|
Section 1350 Certifications.
|
|
|
|
101.INS
|
|
XBRL Instance Document.
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
|
|
|
|
/s/ Michael Kelly
|
|
/s/ Ronald L. Winowiecki
|
Michael Kelly
|
|
Ronald L. Winowiecki
|
|
|
|
/s/ Stacey Petrey
|
|
/s/ Robert F. Withee
|
Stacey Petrey
|
|
Robert F. Withee
|
|
|
|
|
|
|
|
|
|
1.
|
I have reviewed this report on Form 10-Q of Perrigo Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:
|
a.
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting, which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Joseph C. Papa
|
Joseph C. Papa
|
Chairman, President and Chief
|
Executive Officer
|
1.
|
I have reviewed this report on Form 10-Q of Perrigo Company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:
|
a.
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting, which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Judy L. Brown
|
Judy L. Brown
|
Executive Vice President and
|
Chief Financial Officer
|
|
Re:
|
Perrigo Company
|
(i)
|
this Quarterly Report on Form 10-Q fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and
|
(ii)
|
the information contained in this report fairly presents, in all material respects, the financial condition and results of operations of Perrigo Company.
|
/s/ Joseph C. Papa
|
|
/s/ Judy L. Brown
|
Joseph C. Papa
|
|
Judy L. Brown
|
Chairman, President and
|
|
Executive Vice President and
|
Chief Executive Officer
|
|
Chief Financial Officer
|