Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jun. 30, 2021 | Aug. 23, 2021 | Dec. 31, 2020 | |
Document Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Document Period End Date | Jun. 30, 2021 | ||
Entity File Number | 001-36587 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 20-8737688 | ||
Entity Address, Address Line One | 14 Schoolhouse Road | ||
Entity Address, City or Town | Somerset, | ||
Entity Address, State or Province | NJ | ||
Entity Address, Postal Zip Code | 08873 | ||
City Area Code | (732) | ||
Local Phone Number | 537-6200 | ||
Trading Symbol | CTLT | ||
Entity Registrant Name | CATALENT, INC. | ||
Entity Central Index Key | 0001596783 | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding (shares) | 170,787,238 | ||
Entity Interactive Data Current | Yes | ||
Security Exchange Name | NYSE | ||
Title of 12(b) Security | Common Stock, $0.01 par value per share | ||
ICFR Auditor Attestation Flag | true | ||
Entity Public Float | $ 17,710,000,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | ||
Income Statement [Abstract] | ||||
Net revenue | $ 3,998,000,000 | $ 3,094,000,000 | $ 2,518,000,000 | |
Cost of sales | 2,646,000,000 | 2,111,000,000 | 1,713,000,000 | |
Gross margin | 1,352,000,000 | 983,000,000 | 805,000,000 | |
Selling, general, and administrative expenses | 687,000,000 | 577,000,000 | 512,000,000 | |
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal | [1] | (182,000,000) | 1,000,000 | 0 |
Other Cost and Expense, Operating | 19,000,000 | 11,000,000 | 19,000,000 | |
Operating earnings | 828,000,000 | 394,000,000 | 274,000,000 | |
Interest expense, net | 110,000,000 | 126,000,000 | 111,000,000 | |
Other (Income)/expense, net | (3,000,000) | (8,000,000) | (3,000,000) | |
Earnings from continuing operations before income taxes | 715,000,000 | 260,000,000 | 160,000,000 | |
Income tax expense | 130,000,000 | 39,000,000 | 23,000,000 | |
Net earnings attributable to Catalent | 585,000,000 | 221,000,000 | 137,000,000 | |
Participating Securities, Distributed and Undistributed (Earnings) Loss, Basic | (56,000,000) | (48,000,000) | (5,000,000) | |
Net Income (Loss) Available to Common Stockholders, Basic | $ 529,000,000 | $ 173,000,000 | $ 132,000,000 | |
Earnings Per Share, Basic | $ 3.15 | $ 1.16 | $ 0.92 | |
Earnings Per Share, Diluted | $ 3.11 | $ 1.14 | $ 0.90 | |
[1] | Gain on sale of subsidiary for the fiscal year ended June 30, 2021 is affiliated with the sale of the Blow-Fill-Seal Business. Loss on sale of subsidiary for the fiscal year ended June 30, 2020 is affiliated with the disposal of the Australia facility. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income / (Loss) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Net earnings | $ 585 | $ 221 | $ 137 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | 67 | (31) | (19) |
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | 0 | (2) | 9 |
Other Comprehensive Income (Loss), Securities, Available-for-sale, Adjustment, after Tax | (1) | 0 | 0 |
Other Comprehensive Income, Debt Securities, Derivative and Hedge, Gain (Loss), after Adjustment and Tax | 3 | (3) | 0 |
Other comprehensive income /(loss), net of tax | 69 | (32) | (28) |
Comprehensive income/(loss) | 654 | 189 | 109 |
ACOI, Accumulated Gain (Loss), Marketable Securities | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||
Other Comprehensive Income (Loss), Securities, Available-for-sale, Adjustment, after Tax | $ (1) | $ 0 | $ 0 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 | |
Current assets: | |||
Cash and cash equivalents | $ 896 | $ 953 | |
Trade receivables, net | 1,012 | 838 | |
Inventories | 563 | 324 | |
Prepaid Expense and Other Assets, Current | 376 | 178 | |
Marketable Securities | 71 | 0 | |
Total current assets | 2,918 | 2,293 | |
Property, plant, and equipment, net | [1] | 2,524 | 1,901 |
Other assets: | |||
Goodwill | 2,519 | 2,471 | |
Other intangibles, net | 817 | 889 | |
Non-current deferred tax asset | 66 | 49 | |
Other Assets, Noncurrent | 268 | 174 | |
Total assets | 9,112 | 7,777 | |
Current liabilities: | |||
Debt, Current | 75 | 73 | |
Accounts payable | 385 | 321 | |
Other accrued liabilities | 736 | 499 | |
Total current liabilities | 1,196 | 893 | |
Long-term Debt and Finance Lease Obligations | 3,166 | 2,945 | |
Pension liability | 137 | 135 | |
Non-current deferred tax liability | 164 | 94 | |
Other liabilities | 175 | 204 | |
Commitment and contingencies (see Note 14) | |||
Total liabilities | 4,838 | 4,271 | |
Redeemable Preferred Stock Outstandings | 359 | 607 | |
Common Stock, Value, Outstanding | 2 | 2 | |
Preferred Stock, Value, Outstanding | 0 | 0 | |
Additional paid in capital | 4,205 | 3,818 | |
Accumulated deficit | 25 | (535) | |
Accumulated Other Comprehensive Income (Loss), Net of Tax | (317) | (386) | |
Total shareholders’ equity | 3,915 | 2,899 | |
Total liabilities, redeemable preferred stock, and shareholders’ equity | $ 9,112 | $ 7,777 | |
[1] | Long-lived assets include property, plant, and equipment, net of accumulated depreciation. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2021 | Jun. 30, 2020 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (shares) | 170,549,341 | 162,788,043 |
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Preferred Stock, Shares Authorized | 100,000,000 | 100,000,000 |
Preferred Stock, Shares Issued & Outstanding | 384,777 | 650,000 |
Preferred Stock, Shares Issued | 384,777 | 650,000 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Shareholder's Equity - USD ($) | Total | Cumulative Effect, Period of Adoption, Adjustment [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit | Accumulated DeficitCumulative Effect, Period of Adoption, Adjustment [Member] | Accumulated Other Comprehensive (Loss)/Income [Member] |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Redeemable Preferred Stock Outstandings | $ 0 | ||||||
Beginning Balance at Jun. 30, 2018 | 1,086,000,000 | $ 1,000,000 | $ 2,283,000,000 | $ (872,000,000) | $ (326,000,000) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Stockholders' Equity, Other | $ 15,000,000 | $ 15,000,000 | |||||
Stock Issued During Period, Value, New Issues | 447,000,000 | 1,000,000 | 446,000,000 | ||||
Stock Issued During Period, Value, Stock Options Exercised | 0 | 0 | |||||
Equity compensation | 33,000,000 | 33,000,000 | |||||
Payments Related to Tax Withholding for Share-based Compensation | (15,000,000) | (15,000,000) | |||||
Equity issued in lieu of cash consideration | 10,000,000 | 10,000,000 | |||||
Dividends, Preferred Stock | (3,000,000) | (3,000,000) | |||||
Net Income (Loss) Attributable to Parent | 137,000,000 | 137,000,000 | |||||
Other comprehensive income /(loss), net of tax | (28,000,000) | (28,000,000) | |||||
Ending Balance at Jun. 30, 2019 | 1,682,000,000 | 2,000,000 | 2,757,000,000 | (723,000,000) | (354,000,000) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Temporary Equity, Stock Issued During Period, Value, New Issues | 607,000,000 | ||||||
Redeemable Preferred Stock Outstandings | 607,000,000 | ||||||
Stock Issued During Period, Value, New Issues | 1,042,000,000 | 0 | 1,042,000,000 | ||||
Stock Issued During Period, Value, Stock Options Exercised | 0 | 0 | |||||
Equity compensation | 48,000,000 | 48,000,000 | |||||
Payments Related to Tax Withholding for Share-based Compensation | (32,000,000) | (32,000,000) | |||||
APIC, Share-based Payment Arrangement, ESPP, Increase for Cost Recognition | 3,000,000 | 3,000,000 | |||||
Dividends, Preferred Stock | (33,000,000) | (33,000,000) | |||||
Net Income (Loss) Attributable to Parent | 221,000,000 | 221,000,000 | |||||
Other comprehensive income /(loss), net of tax | (32,000,000) | (32,000,000) | |||||
Ending Balance at Jun. 30, 2020 | 2,899,000,000 | 2,000,000 | 3,818,000,000 | (535,000,000) | (386,000,000) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Redeemable Preferred Stock Outstandings | 607,000,000 | ||||||
Stock Issued During Period, Value, New Issues | 82,000,000 | 0 | 82,000,000 | ||||
Stock Issued During Period, Value, Stock Options Exercised | 0 | 0 | |||||
Stock Issued During Period, Value, Conversion of Convertible Securities | 253,000,000 | 253,000,000 | |||||
Equity compensation | 51,000,000 | 51,000,000 | |||||
Payments Related to Tax Withholding for Share-based Compensation | (46,000,000) | (46,000,000) | |||||
APIC, Share-based Payment Arrangement, Option, Increase for Cost Recognition | 38,000,000 | 38,000,000 | |||||
APIC, Share-based Payment Arrangement, ESPP, Increase for Cost Recognition | 9,000,000 | 9,000,000 | |||||
Dividends, Preferred Stock | (25,000,000) | (25,000,000) | |||||
Net Income (Loss) Attributable to Parent | 585,000,000 | 585,000,000 | |||||
Other comprehensive income /(loss), net of tax | 69,000,000 | 69,000,000 | |||||
Ending Balance at Jun. 30, 2021 | 3,915,000,000 | $ 2,000,000 | $ 4,205,000,000 | $ 25,000,000 | $ (317,000,000) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Temporary Equity, Carrying Amount, Period Increase (Decrease) | (248,000,000) | ||||||
Redeemable Preferred Stock Outstandings | $ 359,000,000 |
Consolidated Statement of Cha_2
Consolidated Statement of Changes in Shareholder's Equity - Shares of Common Stock - shares | Total | Common Stock [Member] |
Beginning Balance - Common Stock Outstanding (shares) at Jun. 30, 2018 | 133,424,000 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Stock Issued During Period, Shares, New Issues | 11,431,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 883,000 | |
Ending Balance - Common Stock Outstanding (shares) at Jun. 30, 2019 | 145,738,000 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Stock Issued During Period, Shares, New Issues | 16,196,000,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 166,000 | 854,000,000 |
Ending Balance - Common Stock Outstanding (shares) at Jun. 30, 2020 | 162,788,000 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Stock Issued During Period, Shares, New Issues | 1,163,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 726,000 | 1,206,000 |
Stock Issued During Period, Shares, Conversion of Convertible Securities | 5,392,000 | |
Ending Balance - Common Stock Outstanding (shares) at Jun. 30, 2021 | 170,549,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | ||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||
Net earnings | $ 585,000,000 | $ 221,000,000 | $ 137,000,000 | |
Adjustments to reconcile earnings from continued operations to net cash from operations: | ||||
Depreciation and Amortization | 289,000,000 | 254,000,000 | 229,000,000 | |
Foreign Currency Transaction Gain (Loss), before Tax | (4,000,000) | 2,000,000 | 0 | |
Amortization and write-off of debt financing costs | 11,000,000 | 12,000,000 | 14,000,000 | |
Gain (Loss) on Sale of Assets and Asset Impairment Charges | (9,000,000) | (5,000,000) | (5,000,000) | |
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal | [1] | (182,000,000) | 1,000,000 | 0 |
Financing fees paid | 18,000,000 | 10,000,000 | 5,000,000 | |
Derivative, Gain (Loss) on Derivative, Net | (17,000,000) | (3,000,000) | (13,000,000) | |
Equity compensation | 51,000,000 | 48,000,000 | 33,000,000 | |
Provision/(benefit) for deferred income taxes | 64,000,000 | 2,000,000 | (15,000,000) | |
Provision for bad debts and inventory | 41,000,000 | 10,000,000 | 13,000,000 | |
Change in operating assets and liabilities: | ||||
(Increase)/decrease in trade receivables | (186,000,000) | (151,000,000) | (119,000,000) | |
(Increase)/decrease in inventories | (260,000,000) | (76,000,000) | (34,000,000) | |
Increase/(decrease) in accounts payable | 50,000,000 | 72,000,000 | 36,000,000 | |
Other assets/accrued liabilities, net - current and non-current | (36,000,000) | 33,000,000 | (43,000,000) | |
Net Cash Provided by (Used in) Operating Activities, Total | 433,000,000 | 440,000,000 | 248,000,000 | |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||
Capital expenditures | (686,000,000) | (466,000,000) | (218,000,000) | |
Payments to Acquire Debt Securities, Available-for-sale | (72,000,000) | 0 | 0 | |
Proceeds from sale of property and equipment | 0 | 0 | 1,000,000 | |
Proceeds from Divestiture of Interest in Consolidated Subsidiaries | 287,000,000 | 21,000,000 | 0 | |
Payment for acquisitions, net of cash acquired | (147,000,000) | (379,000,000) | (1,291,000,000) | |
Payments to Acquire Investments | 31,000,000 | 3,000,000 | 2,000,000 | |
Net cash (used in) investing activities | (649,000,000) | (827,000,000) | (1,510,000,000) | |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||
Net change in other borrowings | 2,000,000 | (49,000,000) | (8,000,000) | |
Proceeds from borrowing, net | 164,000,000 | 909,000,000 | 1,448,000,000 | |
Repayments of Long-term Debt | (67,000,000) | (811,000,000) | (1,290,000,000) | |
Payments of Debt Issuance Costs | (19,000,000) | (25,000,000) | (25,000,000) | |
Dividends and Interest Paid | (22,000,000) | (36,000,000) | 0 | |
Proceeds from Issuance of Common Stock | 82,000,000 | 1,046,000,000 | 445,000,000 | |
Proceeds from Issuance of Redeemable Preferred Stock | 0 | 0 | 646,000,000 | |
Proceeds from Stock Options Exercised | 38,000,000 | 0 | 0 | |
Payments Related to Tax Withholding for Share-based Compensation | (46,000,000) | (32,000,000) | (15,000,000) | |
Proceeds from (Payments for) Other Financing Activities | 10,000,000 | 0 | 0 | |
Net cash provided by/(used in) financing activities | 142,000,000 | 1,002,000,000 | 1,201,000,000 | |
Effect of foreign currency on cash | 17,000,000 | (7,000,000) | (4,000,000) | |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect | (57,000,000) | 608,000,000 | (65,000,000) | |
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD | 953,000,000 | 345,000,000 | 410,000,000 | |
CASH AND EQUIVALENTS AT END OF PERIOD | 896,000,000 | 953,000,000 | 345,000,000 | |
SUPPLEMENTARY CASH FLOW INFORMATION: | ||||
Interest paid | 105,000,000 | 98,000,000 | 103,000,000 | |
Income taxes paid, net | 47,000,000 | 43,000,000 | 42,000,000 | |
SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING ACTIVITY: | ||||
Stock Issued During Period, Value, Conversion of Convertible Securities | 253,000,000 | 0 | 0 | |
Disposal Group, Including Discontinued Operation, Accounts, Notes and Loans Receivable, Net | 47,000,000 | 0 | 0 | |
Additional Paid-in Capital [Member] | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||
Payments Related to Tax Withholding for Share-based Compensation | $ (46,000,000) | $ (32,000,000) | $ (15,000,000) | |
[1] | Gain on sale of subsidiary for the fiscal year ended June 30, 2021 is affiliated with the sale of the Blow-Fill-Seal Business. Loss on sale of subsidiary for the fiscal year ended June 30, 2020 is affiliated with the disposal of the Australia facility. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business Catalent, Inc. ( “ Catalent ” or the “ Company ” ) directly and wholly owns PTS Intermediate Holdings LLC ( “ Intermediate Holdings ” ). Intermediate Holdings directly and wholly owns Catalent Pharma Solutions, Inc. ( “ Operating Company ” ). The financial results of Catalent are primarily comprised of the financial results of Operating Company and its subsidiaries on a consolidated basis. In July 2014, the Company commenced an initial public offering (the “ IPO ” ) of its common stock, par value $0.01 (the “ Common Stock ” ), in which it sold a total of 48.9 million shares at a price of $20.50 per share, before underwriting discounts and commissions. The Common Stock began trading on the New York Stock Exchange (the “ NYSE ” ) under the symbol “ CTLT ” as of the IPO. The Company provides differentiated development and manufacturing solutions for drugs, protein-based biologics, cell, and gene therapies, and consumer health products at over fifty facilities across four continents under rigorous quality and operational standards. Its oral, injectable, and respiratory delivery technologies, along with its state-of-the-art protein and cell and gene therapy manufacturing capacity address a wide and growing range of modalities and therapeutic and other categories across the biopharmaceutical and consumer health industries. Through its extensive capabilities, growth-enabling capacity, and deep expertise in product development, regulatory compliance, and clinical trial supply, it can help its customers take products to market faster, including nearly half of new drug products approved by the U.S. Food and Drug Administration (the “FDA”) in the last decade. Its development and manufacturing platforms, which include those in its Biologics, Softgel and Oral Technologies, and Oral and Specialty Delivery segments, its proven formulation, supply, and regulatory expertise, and its broad and deep development manufacturing know-how enable its customers to advance and then bring to market more products and better treatments for patients and consumers. Its commitment to reliably supply its customers’ and their patients’ needs is the foundation for the value it provides; annually, it produces more than 70 billion doses for nearly 7,000 customer products, or approximately 1 in every 24 doses of such products taken each year by patients and consumers around the world. The Company believes that, through its investments in state-of-the-art facilities and capacity expansion, including investments in facilities focused on new treatment modalities and other attractive market segments, its continuous improvement activities devoted to operational and quality excellence, the sales of existing and introduction of new customer products, and, in some cases, its innovation activities and patents, it will continue to attract premium opportunities and realize the growth potential from these areas. Reporting Segments Each of the four reporting segments reports through a separate management team and ultimately reports to the Company's Chief Executive Officer, who is designated as the Chief Operating Decision Maker for segment reporting purposes. The Company's operating segments are the same as its reporting segments. Biologics The Company’s Biologics segment provides biologic cell-line, cell therapy and viral-based gene therapy development and manufacturing; formulation, development, and manufacturing for parenteral dose forms, including prefilled syringes, vials, and cartridges; and analytical development and testing services for large molecules. The segment has extensive expertise in development, scale up, and commercial manufacturing. The Company’s growing biologic offering includes cell-line development based on its advanced and patented GPEx suite of technologies, which are used to develop stable, high-yielding mammalian cell lines for both innovator and biosimilar biologic compounds. GPEx technology can provide rapid cell-line development, high biologics production yields, flexibility, and versatility. Its development and manufacturing facility in Madison, Wisconsin has the capability and capacity to produce current good manufacturing practices ("cGMP") quality biologics drug substance from 250L to 4,000L scale using single-use technology to provide maximum efficiency and flexibility. Its Bloomington, Indiana facility brings additional biologics development, clinical, and commercial drug substance manufacturing, and formulation capabilities and capacity. Both Bloomington and the Anagni, Italy facility add substantial capacity for finished-dose drug product manufacturing and packaging. The segment has continued to expand production capacity, including the fourth and fifth drug substance manufacturing suites in its Madison, Wisconsin facility, expanded drug product manufacturing and packaging capacity in its Bloomington and Anagni facilities, and recently announced a planned expansion of its Anagni facility to permit drug substance development and manufacturing. Its SMARTag next-generation antibody-drug conjugate (“ADC”) technology, based in Emeryville, California, is a clinical-stage technology that enables development of ADCs and other protein conjugates with improved efficacy, safety, and manufacturability. At the Company’s cell and gene therapy centers in Belgium, Maryland, and Texas, it develops and manufactures complex biologics, including CAR-T, AAV, lentivirus, oncolytic virus and other cell or virus modalities for cell- and viral-based therapies and next-generation vaccines. Through continued inorganic investment between November 2020 and June 2021, the Company acquired two additional cell and gene therapy manufacturing facilities and Delphi Genetics SA (“Delphi”), a plasmid DNA business, to create a European Center of Excellence in Belgium. This campus now includes clinical through commercial-scale cell therapy manufacturing and both small- and large-scale plasmid DNA production. Additionally, in August 2021, it acquired RheinCell Therapeutics GmbH (“RheinCell”), a company based in Lagenfeld, Germany that specializes in pluripotent stem cell (“iPSC”) production. This portfolio expansion strengthens Catalent’s cell therapy offering by adding proprietary cGMP iPSC cell lines and enhances the Company’s ability to manufacture next generation cell therapies at scale. In its gene therapy network across Maryland and Texas, the Company has further expanded its footprint with the construction of 5 additional commercial gene therapy suites at its Harmans commercial campus in Maryland, creating a total of 15 commercial suites, and repurposed its Rockville facility in Maryland for both small- and large-scale plasmid DNA production. Its specialized expertise in AAV vectors, the most commonly used delivery system for gene therapy, and both autologous and allogeneic cell therapy modalities, together with its expanded capabilities in plasmids, positions the Company to capitalize on strong and growing industry demand in the cell and gene therapy market. The segment's range of injectable manufacturing offerings includes manufacturing drug substance and filling small molecules or biologics into vials, syringes, and cartridges, with flexibility to accommodate other formats within the segment's existing network. In addition to primary packaging, its network provides secondary packaging capabilities, including auto-injector and safety device assembly for commercial launch and life cycle management. The Company's Clinical Supply Services business provides a global network for clinical distribution, as well as labeling, packaging and cold chain for clinical trial supply of biotherapeutics and cell and gene therapies. Its fill and finish services are largely focused on complex pharmaceuticals and biologics. With its range of technologies, the Company is able to meet a wide range of specifications, timelines, and budgets. The Company believes that the complexity of the manufacturing process, the importance of experience and know-how, regulatory compliance, and substantial capital requirements provide it with a meaningful competitive advantage in the market. The Biologics segment also offers biologics analytical development and testing services for large molecules, including bioassay, biophysical characterization, and cGMP release and stability testing. Its OneBio Suite provides customers the potential to seamlessly integrate drug substance, drug product, and clinical supply management for products in development, and for integrated commercial supply across both drug substance and drug product. The Biologics segment provides a broad range of technologies and services supporting the development and launch of new biologic entities, biosimilars, biobetters, and cell and gene therapies to bring a product from gene to commercialization, faster. Softgel and Oral Technologies Through its Softgel and Oral Technologies segment, the Company provides formulation, development, and manufacturing services for soft capsules, or “softgels,” as well as large-scale manufacturing of oral solid dose forms for pharmaceutical and consumer health markets, along with supporting ancillary services. Catalent’s softgel technology was first commercialized by its predecessor in the 1930s, and it has continually enhanced the platform since then. The segment is the market leader in overall softgel development and manufacturing and holds the leading market position in innovator drug softgels. Its principal softgel technologies include traditional softgel capsules, in which the shell is made of animal-derived gelatin, and Vegicaps and OptiShell capsules, in which the shell is made from plant-derived materials. Softgel capsules are used in a broad range of customer products, including prescription drugs, over-the-counter medications, dietary supplements, unit-dose cosmetics, and animal health medicinal preparations. Softgel capsules encapsulate liquid, paste, or oil-based formulations of active compounds in solution or suspension within an outer shell. In the manufacturing process, the capsules are formed, filled, and sealed simultaneously. The segment typically performs encapsulation for a product within one of its softgel facilities, with active ingredients provided by customers or sourced directly by the Company. Softgels have historically been used to solve formulation challenges or technical issues for a specific drug, to help improve the clinical performance of compounds, to provide important market differentiation, particularly for over-the-counter medications, and to provide safe handling of hormonal, highly potent, and cytotoxic drugs. The segment also participates in the softgel vitamin, mineral, and supplement business in selected regions around the world. With the 2001 introduction of the Company’s plant-derived softgel shell, Vegicaps capsules, consumer health customers have been able to extend the softgel dose form to a broader range of active ingredients and serve patient/consumer populations that were previously inaccessible due to religious, dietary, or cultural preferences. In recent years, the segment extended this platform to pharmaceutical products via its OptiShell capsule offering. Its Vegicaps and OptiShell capsules are protected by patents in most major global markets. Physician and patient studies the Company has conducted have demonstrated a preference for softgels versus traditional tablet and hard capsule dose forms in terms of ease of swallowing, real or perceived speed of delivery, ability to remove or eliminate unpleasant odor or taste, and, for physicians, perceived improved patient adherence with dosing regimens. Its large-scale manufacturing under cGMP of oral solid dose forms typically includes late-stage clinical trial supplies, registration batches, and commercial production across a broad range of formats, and may also involve advanced processing of intermediates to achieve the desired clinical performance of the prescription or over-the-counter pharmaceutical product. Finished dose forms include traditional and advanced complex oral solid-doses, including coated and uncoated tablets, pellet/bead/powder-filled two-piece hard capsules, granulated powders, and other immediate and modified release forms. Advanced intermediate processing may include coating, extrusion, or spheronization to achieve specific functional outcomes, including site or time-specific drug release, taste masking, or enhanced bioavailability. The Company has deep experience at managing complex technical transfers of clinical or commercial programs, whether from Catalent’s early development network in the Oral and Specialty Delivery segment, other contract development sites, or from customers directly. Oral and Specialty Delivery The Company’s Oral and Specialty Delivery segment provides advanced analytical and formulation development and manufacturing across a range of technologies along with integrated downstream clinical development and commercial supply solutions. The technologies cover a broad range of oral (including its proprietary fast-dissolve Zydis tablets and many bioavailability enhancement technologies for both immediate and controlled-release tablets and capsules), respiratory and inhaled dose forms (including metered dose inhalers, dry powder inhalers and nasal delivery devices). The segment provides comprehensive pre-clinical screening, formulation and analytical development, and cGMP manufacturing at both clinical and commercial scale for both traditional and advanced complex oral solid-dose formats. It has substantial, proven experience in developing and scaling up orphan and rare disease oral products, especially those requiring accelerated development timelines, solubility enhancement, specialized handling ( e.g ., potent or controlled substance materials), complex technology transfer and specialized manufacturing processes. It provides spray drying, hot melt extrusion, micronization, and lipid formulation capabilities, all of which are used to enhance a drug’s bioavailability and clinical performance. It offers comprehensive analytical method development and scientific capabilities, including stability testing, and global regulatory services to support both fully integrated development programs and standalone fee-for-service work. In recent years, the segment has expanded its network of clinical development sites focused on earlier phase compounds ( i.e ., pre-clinical and Phase I) to engage with more customer molecules earlier in their development, with the intent to also support these molecules downstream as they progress towards commercial approval and supply. Demand for its offerings is driven by the need for strong scientific expertise, the depth and breadth of integrated services offered, as well as the reliability of its supply performance across quality and operational parameters. The Company launched its orally dissolving tablet business in 1986 with the introduction of Zydis, a unique proprietary freeze-dried tablet that dissolves in the mouth, without water, in typically less than three seconds. The platform is often used for drugs that benefit from rapid oral dissolution and buccal absorption and for drugs for specialized patient groups, including geriatric or pediatric populations, that have difficulty swallowing (dysphagia). The Company can adapt the Zydis technology to a wide range of molecules and indications, including prescription treatments for a variety of central nervous system-related conditions such as migraine, Parkinson’s disease, and schizophrenia, and also for a range of consumer healthcare products targeting broader indications such as pain or allergy relief. It continues to invest in and develop Zydis orally dissolving tablets in different ways with its customers as it extends the application of the technology to new therapeutic categories, including immunotherapy, vaccines and biologic molecule delivery. The segment’s respiratory platform provides integrated molecule screening, formulation development, and commercial manufacturing services for inhaled products delivered via metered dose inhalers, dry powder inhalers, and intra-nasal sprays. Delivery of these inhaled combination device products requires specialized capabilities to account for both the molecule and the device, to ensure accurate repeatable dose delivery. Clinical Supply Services The Company’s Clinical Supply Services segment provides manufacturing, packaging, storage, distribution, and inventory management for drugs and biologics in clinical trials. It offers customers flexible solutions for clinical supplies production and provide distribution and inventory management support for both simple and complex clinical trials. This includes over-encapsulation where needed; supplying placebos, comparator drug procurement, and clinical packages and kits for physicians and patients; inventory management; investigator kit ordering and fulfillment; and return supply reconciliation and reporting. It supports trials in all regions of the world through its facilities and distribution network. In recent years, the segment has continued to expand and extend its network, with significant expansions in Kansas City, Missouri and Singapore and new facilities in California, China, and Japan. The segment continues to develop new solutions for the evolving clinical trial environment, including FlexDirect direct-to-patient and CT Success and trial planning. The Clinical Supply Services segment is the leading provider of integrated development solutions and one of the leading providers of clinical trial supplies. Basis of Presentation These financial statements include all of the Company’s subsidiaries, including those operating outside the United States ( “ U.S. ” ) and are prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). All significant transactions among the Company’s subsidiaries and reporting segments have been eliminated, other than as noted. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires the Company's management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Such estimates include, but are not limited to, allowance for credit losses, inventory and long-lived asset valuation, goodwill and other intangible asset valuation and impairment, equity-based compensation, income taxes, derivative valuation, and pension plan asset and liability valuation. Actual amounts may differ from these estimated amounts. Reclassification Certain prior-period amounts were reclassified to conform to the current period presentation. These reclassifications did not have a material impact on the consolidated statements of operations, consolidated balance sheets, consolidated statements of cash flows, or notes to the consolidated financial statements. Foreign Currency Translation The financial statements of the Company’s operations outside the U.S. are generally measured using the local currency as the functional currency. Adjustments to translate the assets and liabilities of the foreign operations into U.S. dollars are accumulated as a component of other comprehensive income utilizing period-end exchange rates. Beginning on July 1, 2018, as a result of the three-year cumulative consumer price index exceeding 100%, the Company has accounted for its Argentine operations as highly inflationary, but this change has not had a material effect on the consolidated financial statements. The currency fluctuation related to certain long-term inter-company loans where settlement is not planned or anticipated in the foreseeable future have been recorded within the cumulative translation adjustment, a component of other comprehensive income. In addition, the currency fluctuation associated with the portion of the Company’s euro-denominated debt designated as a net investment hedge is included as a component of other comprehensive income. Foreign currency transaction gains and losses calculated by utilizing weighted average exchange rates for the period are included in the statements of operations in “ other expense, net. ” Such foreign currency transaction gains and losses include inter-company loans that are repayable in the foreseeable future. Cash and Cash Equivalents All liquid investments purchased with original maturities of three months or less are considered cash equivalents. The carrying value of these cash equivalents approximates fair value. Allowance for Credit Losses Trade receivables, contract assets, and other amounts owed to the Company are presented net of an allowance that includes an assessment of expected credit losses. The Company determines its allowance methodology by considering various factors, including the Company’s previous loss history, aging of customer receivable balances, significant aspects of a geographic location's economic conditions, the current and anticipated future condition of the general economy and the industries in which the Company's primary customers operate. To the extent that the Company identifies that any individual customer's credit quality has deteriorated, the Company establishes allowances based on the individual risk characteristics of that customer. The Company makes concerted efforts to collect all outstanding balances due from customers; however, trade receivables and contract assets are written off against the allowance when the related balances are no longer deemed collectible. Concentrations of Credit Risk and Major Customers Concentration of credit risk, with respect to accounts receivable, is limited due to the large number of customers and their dispersion across different geographic areas. The customers are primarily concentrated in the pharmaceutical and consumer products industries. The Company does not normally require collateral or any other security to support credit sales. The Company performs ongoing credit evaluations of its customers’ financial conditions and maintains reserves for credit losses. Such losses historically have been within the Company’s expectations. No single customer exceeded 10% of revenue during the fiscal years ended June 30, 2021, 2020, and 2019. As of June 30, 2021, the Company had one customer that represented 15% or $155 million of its net trade receivables balance. No customer exceeded 10% of trade receivables as of June 30, 2020. Inventories Inventory is stated at the lower of cost or net realizable value, using the first-in, first-out ( “ FIFO ” ) method. The Company provides for cost adjustments for excess, obsolete, or slow-moving inventory based on changes in customer demand, technology developments or other economic factors. Inventory consists of costs associated with raw material, labor, and overhead. Goodwill The Company accounts for purchased goodwill and intangible assets with indefinite lives in accordance with ASC 350, Intangibles - Goodwill and Other . Under ASC 350, goodwill and intangible assets with indefinite lives are not amortized, but instead are tested for impairment at least annually. The Company performs an impairment evaluation of goodwill annually during the fourth quarter of its fiscal year or when circumstances otherwise indicate an evaluation should be performed. The evaluation may begin with a qualitative assessment for each reporting unit to determine whether it is more-likely-than-not that the fair value of the reporting unit is less than its carrying value. Factors considered in a qualitative assessment include, among other things, macroeconomic conditions, industry and market considerations, financial performance of the respective reporting unit and other relevant entity and reporting-unit specific considerations. If the qualitative assessment does not generate a positive response, or if no qualitative assessment is performed, a quantitative assessment, based upon discounted cash flows, is performed and requires management to estimate future cash flows, growth rates, and macroeconomic, industry, and market conditions. In fiscal 2019 and 2021, the Company began its impairment evaluation with the qualitative assessment, but in fiscal 2020, the Company proceeded immediately to the quantitative assessment. Based on its qualitative assessment conducted as of April 1, 2021, the Company determined for each reporting unit with goodwill that it was more likely than not that its respective fair value exceeded its carrying value, indicating there was no impairment. For more information regarding goodwill balances at June 30, 2021, see Note 4, Goodwill . Property and Equipment and Other Definite-Lived Intangible Assets Property and equipment are stated at cost. Depreciation expense is computed using the straight-line method over the estimated useful lives of the assets, including leasehold improvements and finance lease right-of-use assets that are amortized over the shorter of their useful lives or the terms of the respective leases. The Company generally uses the following range of useful lives for its property and equipment categories: buildings and improvements—5 to 50 years; machinery and equipment—3 to 10 years; and furniture and fixtures—3 to 7 years. Depreciation expense was $196 million for the fiscal year ended June 30, 2021, $165 million for the fiscal year ended June 30, 2020, and $141 million for the fiscal year ended June 30, 2019. Depreciation expense includes amortization of assets related to financing leases. The Company charges repairs and maintenance costs to expense as incurred. The amount of capitalized interest for fiscal 2021 and 2020 was $17 million and $11 million, respectively, and was immaterial for fiscal 2019. Intangible assets with finite lives, including customer relationships, patents, and trademarks, are amortized over their useful lives. The Company also capitalizes certain computer software and development costs in other intangibles, net, when incurred in connection with developing or obtaining computer software for internal use. Capitalized software costs are amortized over the estimated useful lives of the software, which generally range from 3 to 5 years. The Company evaluates the recoverability of its other long-lived assets, including amortizing intangible assets, if circumstances indicate impairment may have occurred pursuant to ASC 360, Property, Plant and Equipment . This analysis is performed by comparing the respective carrying values of the assets to the current and expected future cash flows, on an un-discounted basis, to be generated from such assets. If such analysis indicates that the carrying value of these assets is not recoverable, the carrying value of such assets is reduced to fair value through a charge to the consolidated statements of operations. Fair value is determined based on assumptions the Company believes marketplace participants would utilize and comparable marketplace information in similar arm’s length transactions. The Company recorded impairment charges related to definite-lived intangible assets and property, plant, and equipment of $9 million, $5 million, and $5 million for the fiscal years ended June 30, 2021, 2020, and 2019, respectively. Post-Retirement and Pension Plans The Company sponsors various retirement and pension plans, including defined benefit and defined contribution retirement plans. The measurement of the related benefit obligations and the net periodic benefit costs recorded each year are based upon actuarial computations, which require management’s judgment as to certain assumptions. These assumptions include the discount rates used in computing the present value of the benefit obligations and the net periodic benefit costs, the expected future rate of salary increases (for pay-related plans) and the expected long-term rate of return on plan assets (for funded plans). The Company uses the corridor approach to amortize actuarial gains and losses. The Company has elected to utilize an approach to estimate the service and interest components of net periodic benefit cost for benefit plans that discounts the individual expected cash flows using the applicable spot rates derived from the yield curve over the projected cash flow period. The expected long-term rate of return on plan assets is based on the target asset allocation and the average expected rate of growth for the asset classes invested. The average expected rate of growth is derived from a combination of historic returns, current market indicators, and the expected risk premium for each asset class. The Company uses a measurement date of June 30 for all its retirement and postretirement benefit plans. Derivative Instruments, Hedging Activities, and Fair Value Derivative Instruments and Hedging Activities The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest-rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its debt funding and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments from time to time to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the values of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to the Company’s borrowings. The Company does not net any of its derivative positions under master netting arrangements. Primarily, the Company is exposed to fluctuations in the euro-U.S. dollar exchange rate on its investments in foreign operations in Europe. While the Company does not actively hedge against changes in foreign currency, it has mitigated the exposure of investments in its European operations through a net-investment hedge by denominating a portion of its debt in euros. In addition, a portion of Operating Company's interest payment obligation on its U.S dollar-denominated term loans is exposed to interest rate variability. The Company has mitigated its exposure to this risk by entering into interest-rate swap agreements, which qualify for and are designated as cash-flow hedges. Also, as discussed in Note 9, Derivative Instruments and Hedging Activities , the Company has determined that an aspect of the dividend-rate adjustment feature of the Company’s convertible Series A Preferred Stock (as defined below, see Note 13, Equity, Redeemable Preferred Stock, and Accumulated Other Comprehensive Loss ) should be accounted for as a derivative liability. Fair Value The Company is required to measure certain assets and liabilities at fair value, either upon initial measurement or for subsequent accounting or reporting. The Company uses fair value extensively, including in the initial measurement of net assets acquired in a business combination and when accounting for and reporting on certain financial instruments. The Company estimates fair value using an exit price approach, which requires, among other things, that it determine the price that would be received to sell an asset or paid to transfer a liability in an orderly market. The determination of an exit price is considered from the perspective of market participants, considering the highest and best use of assets and, for liabilities, assuming the risk of non-performance will be the same before and after the transfer. A single estimate of fair value results from a complex series of judgments about future events and uncertainties and relies heavily on estimates and assumptions. When estimating fair value, depending on the nature and complexity of the assets or liability, the Company may use one or all of the following approaches: • Market approach, which is based on market prices and other information from market transactions involving identical or comparable assets or liabilities. • Cost approach, which is based on the cost to acquire or construct comparable assets less an allowance for functional and/or economic obsolescence. • Income approach, which is based on the present value of the future stream of net cash flows. Certain investments that are measured at fair value using the net asset value ( “ NAV ” ) per share (or its equivalent) pr |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Jun. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer | REVENUE RECOGNITION The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers . The Company generally earns its revenue by supplying goods or providing services under contracts with its customers in three primary revenue streams: manufacturing and commercial product supply, development services, and clinical supply services. The Company measures the revenue from customers based on the consideration specified in its contracts, excluding any sales incentive or amount collected on behalf of a third party. The Company’s customer contracts generally include provisions entitling the Company to a termination penalty when the customer invokes its contractual right to terminate prior to the contract’s nominal end date. The termination penalties in the customer contracts vary but are generally considered substantive for accounting purposes and create enforceable rights and obligations throughout the stated duration of the contract. The Company accounts for a contract cancellation as a contract modification in the period in which the customer invokes the termination provision. The determination of the contract termination penalty is based on the terms stated in the relevant customer agreement. As of the modification date, the Company updates its estimate of the transaction price using the expected value method, subject to constraints, and recognizes the amount over the remaining performance period . The Company generally expenses sales commissions as incurred because either the amortization period is one year or less, or the balance with an amortization period greater than one year is not material. The following tables reflect revenue for the fiscal year ended June 30, 2021 and 2020 by type of activity and reporting segment (in millions): Fiscal Year Ended June 30, 2021 Biologics Softgel and Oral Technologies Oral and Specialty Delivery Clinical Supply Services Total Manufacturing & commercial product supply $ 533 $ 877 $ 455 $ — $ 1,865 Development services 1,395 135 231 — 1,761 Clinical supply services — — — 391 391 Total $ 1,928 $ 1,012 $ 686 $ 391 $ 4,017 Inter-segment revenue elimination (19) Combined net revenue $ 3,998 Fiscal Year Ended June 30, 2020 Biologics Softgel and Oral Technologies Oral and Specialty Delivery Clinical Supply Services Total Manufacturing & commercial product supply $ 332 $ 955 $ 450 $ — $ 1,737 Development services 689 107 226 — 1,022 Clinical supply services — — — 345 345 Total $ 1,021 $ 1,062 $ 676 $ 345 $ 3,104 Inter-segment revenue elimination (10) Combined net revenue $ 3,094 The following table reflects revenue by the location where the goods were made or the service performed: (Dollars in millions) Fiscal Year Ended Fiscal Year Ended United States $ 2,462 $ 1,822 Europe 1,343 976 Other 288 376 Elimination of revenue attributable to multiple locations (95) (80) Total $ 3,998 $ 3,094 Manufacturing & Commercial Product Supply Revenue Manufacturing and commercial product supply revenue consists of revenue earned by manufacturing products supplied to customers under long-term commercial supply arrangements. In these arrangements, the customer typically owns and supplies the active pharmaceutical ingredient, or API, that is used in the manufacturing process. The contract generally includes the terms of the manufacturing services and related product quality assurance procedures to comply with regulatory requirements. Due to the regulated nature of the Company’s business, these contract terms are highly interdependent and, therefore, are considered to be a single combined performance obligation. The transaction price is generally stated in the agreement as a fixed price per unit, with no contractual provision for a refund or price concession. Control is transferred to the customer over time, creating a corresponding right to recognize the related revenue, because there is no alternative use to the Company for the asset created and the Company has an enforceable right to payment for performance completed as of that date. Progress is measured based on the units of product that have successfully completed the contractually required product quality assurance process, as the conclusion of that process generally defines the time when the applicable contract and the related regulatory requirements permit the customer to exercise control over the product’s disposition. The customer is typically responsible for arranging the shipping and handling of product following completion of the quality assurance process. Payment is typically due 30 to 90 days after the goods are shipped as requested by the customer, based on the payment terms set forth in the applicable customer agreement. Development Services Revenue Development services contracts generally take the form of short-term, fee-for-service arrangements. Performance obligations vary, but frequently include biologic cell-line development, performing formulation, analytical stability, or other services related to product development, and providing manufacturing services for products that are under development or otherwise not intended for commercial sale. The transaction prices for these arrangements are fixed and include amounts stated in the contracts for each promised service, and each service is generally considered to be a separate performance obligation. The Company recognizes revenue over time because there is no alternative use to the Company for the asset created and the Company has an enforceable right to payment for performance completed as of that date. The Company measures progress toward the completion of its performance obligations satisfied over time based on the nature of the services to be performed. For certain types of arrangements, revenue is recognized over time and measured using an output method based on the completion of tasks and activities that are performed to satisfy a performance obligation. For all other types of arrangements, revenue is recognized over time and measured using an input method based on effort expended. Each of these methods provides an appropriate depiction of the Company’s progress toward fulfilling its performance obligations for its respective arrangement. In certain development services arrangements that require a portion of the contract consideration to be received in advance at the commencement of the contract, such advance payment is initially recorded as a contract liability. The Company allocates consideration to each performance obligation using the “relative standalone selling price” as defined under ASC 606. Generally, the Company utilizes observable standalone selling prices in its allocations of consideration. If observable standalone selling prices are not available, the Company estimates the applicable standalone selling price using an adjusted market assessment approach, representing the amount that the Company believes the market is willing to pay for the applicable service. Payment is typically due 30 to 90 days following the completion of services provided to the customer, based on the payment terms set forth in the applicable customer agreemen t . Clinical Supply Services Revenue Clinical supply services contracts generally take the form of fee-for-service arrangements. Performance obligations for clinical supply services revenue typically include a combination of the following services: the manufacturing, packaging, storage, distribution, destruction, and inventory management of customer clinical trial material. Performance obligations can also include the sourcing of comparator drug products on behalf of customers to be used in clinical trials to compare performance with the drug under clinical investigation. In certain arrangements, the Company recognizes revenue over time when the Company satisfies performance obligations. Satisfaction of the performance obligations is measured using an input method measure of progress based on effort expended by the Company. In other arrangements, revenue is recognized at the point in time when control transfers, which occurs upon either the delivery of the related output of the service to the customer or the completion of quality testing with respect to the product, and the Company has an enforceable right to payment based on the terms of the arrangement. Payment is typically due 30 to 90 days following the completion of services provided to the customer, based on the payment terms set forth in the applicable customer agreement. The Company records revenue for comparator sourcing arrangements on a net basis because it is acting as an agent that does not control the product or service before it is transferred to the customer. Payment for comparator sourcing activity is typically received in advance at the commencement of the contract and is initially recorded as a contract liability. Licensing Revenue The Company occasionally enters into arrangements with its customers that include licenses of functional intellectual property, including patents, or other intangible property (“out-licensing”). Revenue from such arrangements are within the scope of ASC 606. The Company does not have any material license arrangement that contains more than one performance obligation. The terms of such out-licensing arrangements include the license of functional intellectual or intangible property (primarily drug formulae) and typically provide for payment by the licensee of one or more of the following: non-refundable, up-front license fees or royalties on net sales of licensed products. The Company recognizes revenue from nonrefundable, up-front license fees when the licensed intellectual property is made available for the customer’s use and benefit, which is generally at the inception of the arrangement. Royalty payments from such arrangements are recognized when subsequent sale or usage of an item subject to the royalty occurs and the performance obligation to which royalty relates is satisfied . Contract Liabilities Contract liabilities relate to cash consideration that the Company receives in advance of satisfying the related performance obligations. The contract liabilities balances (current and non-current) as of June 30, 2021 and June 30, 2020 were as follows: (Dollars in millions) Balance at June 30, 2020 $ 218 Balance at June 30, 2021 $ 321 Revenue recognized in the period from amounts included in contracts liability at the beginning of the period: $ 196 Contract liabilities that will be recognized within 12 months of June 30, 2021 are accounted for in Other accrued liabilities and those that will be recognized longer than 12 months after June 30, 2021 are accounted for within Other liabilities. Contract Assets Contract assets primarily relate to the Company's conditional right to receive consideration for services that have been performed for the customer as of June 30, 2021 relating to its development services but had not yet been invoiced as of June 30, 2021. Contract assets are transferred to trade receivables, net when the Company’s right to receive the consideration becomes unconditional. Contract assets totaled $181 million and $61 million as of June 30, 2021 and 2020, respectively. Contract assets are accounted for within prepaid expenses and other in the consolidated balance sheets. |
Business Combinations
Business Combinations | 12 Months Ended |
Jun. 30, 2021 | |
Business Combinations [Abstract] | |
Business Combination Disclosure | BUSINESS COMBINATIONS AND DIVESTITURES Anagni Acquisition In January 2020, the Company acquired an oral solid, biologics, and sterile product manufacturing and packaging facility in Anagni, Italy. The Company paid $55 million in cash as part of the purchase consideration and as consideration for the provision of certain services to facilitate the transition to Company ownership. At the closing of this acquisition, the seller of the facility also entered into a five-year agreement for continuing supply by the Company of certain products at the Anagni facility. Due to the variety of activities performed at Anagni, the results of the Anagni facility are allocated between the Oral and Specialty Delivery and Biologics segments. The total cash consideration was allocated between the facility purchase and the transitional services arrangement, with $52 million assigned to the purchase consideration and the balance to transitional services. The Company funded the entire amount with cash on hand and allocated the purchase price among the acquired assets, recognizing property, plant, and equipm ent of $34 million, inventory of $6 million, and prepaid expenses and other of $12 million. The purchase price was also allocated to deferred tax assets and certain employee-related liabilities assumed in the a cquisition. MaSTherCell Acquisition In February 2020, the Company acquired 100% of the equity interest in Masthercell Global Inc. ( “ MaSTherCell ” ) for an aggregate purchase price of $323 million , which was funded with the net proceeds of the Company’s February 2020 equity offering (the “February 2020 Equity Offering”) of its Common Stock. See Note 13, Equity, Redeemable Preferred Stock and Accumulated Other Comprehensive Loss . MaSTherCell is a contract development and manufacturing organization focused on the development and manufacture of autologous and allogeneic cell therapies for third parties, as well as a variety of related analytical services. The Company accounted for the MaSTherCell acquisition using the acquisition method in accordance with ASC 805, Business Combinations . The operating results of MaSTherCell have been included in the Company’s consolidated financial statements for the period following the acquisition date. The Company estimated fair values at the date of acquisition for the allocation of consideration to the net tangible and intangible assets acquired and liabilities assumed as part of the MaSTherCell acquisition. The purchase price allocation to assets acquired and liabilities assumed in the transaction is (in millions): Property, plant, and equipment $ 26 Identifiable intangible assets 51 Other net assets 1 Deferred income tax liabilities (8) Total identifiable net assets $ 70 Goodwill 253 Total assets acquired and liabilities assumed $ 323 The carrying values of trade receivables, raw materials inventory, and trade payables, as well as certain other current and non-current assets and liabilities generally represented their fair values at the date of acquisition. Property, plant, and equipment was valued using the cost approach, which is based on the current replacement or reproduction cost of the asset as new, less depreciation attributable to physical, functional, and economic factors. The Company then determined the remaining useful life based on the anticipated life of the asset and Company policy for similar assets. Customer-relationship intangible assets of $46 million were valued using the multi-period, excess-earnings method, a method that values the intangible assets using the present value of the after-tax cash flows attributable to the intangible assets only. The assumptions used in developing the valuation included the estimated annual net cash flows (including application of an appropriate margin to forecasted revenue, selling and marketing costs, return on working capital, contributory asset charges, and other factors), the discount rate that appropriately reflects the risk inherent in each future cash flow stream, and an assessment of the assets’ life cycles, as well as other factors. The assumptions used in the financial forecasts were based on historical data, supplemented by current and anticipated growth rates, management plans, and market-comparable information. The customer relationship intangible assets have a weighted average useful life of 13 years. Goodwill is mainly comprised of the growth from an expected increase in capacity utilization, potential new customers, and advanced cell therapy development and manufacturing capabilities. The goodwill arising from the MaSTherCell acquisition has been assigned to the Biologics segment. Skeletal Cell Therapy Support SA Acquisition In November 2020, the Company acquired 100% of the equity interest in Skeletal Cell Therapy Support SA (“Skeletal”) for $15 million, subject to customary adjustments, as well as related supply agreements with the seller. Skeletal operates a cell therapy manufacturing facility in Gosselies, Belgium. The operations were assigned to the Company’s Biologics segment, expanding the Company’s cell therapy capacity for clinical and commercial supply. The acquisition, when combined with the Company's other European-based facilities and capabilities in cell therapy, has created an integrated European center of excellence in cell therapy. The Company accounted for the Skeletal acquisition using the acquisition method in accordance with ASC 805. The Company funded the entire purchase price with cash on hand and preliminarily allocated the purchase price to trade receivables, property, plant, and equipment, deferred tax assets, and other current and non-current assets and liabilities assumed in the acquisition, which resulted in a recognition of $9 million of goodwill . Results for the fiscal year ended June 30, 2021 were not material to the Company’s statement of operations, financial position, or cash flows. The Company has not completed its analysis regarding the assets acquired and liabilities assumed. Therefore, the allocation to goodwill and income taxes are preliminary and subject to finalization. The Company expects to finalize its allocation over the next several months, but, in any event, within one year from the acquisition date. Acorda Therapeutics, Inc. Acquisition In February 2021, the Company acquired the manufacturing and packaging operations of Acorda Therapeutics, Inc.'s (“Acorda”) dry powder inhaler and spray dry manufacturing business, including its manufacturing facility located near Boston, Massachusetts, for $83 million , subject to customary adjustments. In connection with the purchase, Acorda and the Company entered into a long-term supply agreement, under which the Company will continue the manufacture and packaging of an Acorda product at the facility. The facility and operations became part of the Company’s Oral and Specialty Delivery segment. Results of the business acquired were not material to the Company's statement of operations, financial position, or cash flows for the fiscal year ended June 30, 2021. The Company accounted for the Acorda transaction using the acquisition method in accordance with ASC 805. The Company funded the entire purchase price with cash on hand and preliminarily allocated the purchase price among the acquired assets, recognizing property, plant, and equipment of $79 million , inventory of $2 million , and goodwill of $2 million . The purchase price was also preliminarily allocated to other current and non-current assets and liabilities assumed in the acquisition. The Company has not completed its analysis regarding the assets acquired and liabilities assumed. Therefore, the allocation to goodwill and inventory are preliminary and subject to finalization. The Company expects to finalize its allocation over the next several months, but, in any event, within one year from the acquisition date. Delphi Genetics SA Acquisition In February 2021, the Company acquired 100% of the equity interest in Delphi for $50 million , subject to customary adjustments. Delphi is a plasmid DNA (pDNA) cell and gene therapy contract development and manufacturing organization based in Gosselies, Belgium. The facility and operations acquired became part of the Company’s Biologics segment. Results of the business acquired were not material to the Company's statement of operations, financial position, or cash flows for the fiscal year ended June 30, 2021. The Company accounted for the Delphi transaction using the acquisition method in accordance with ASC 805. The Company funded the entire purchase price with cash on hand and preliminarily allocated the purchase price recognizing property, plant, and equipment of $6 million , intangible assets of $7 million , other current assets of $3 million , assumed debt of $6 million , other current liabilities of $5 million and goodwill of $45 million . The Company has not completed its analysis regarding the assets acquired and liabilities assumed. Therefore, the allocation to intangible assets, inventory, goodwill, and income taxes is preliminary and subject to finalization. The Company expects to finalize its allocation over the next several months, but, in any event, within one year from the acquisition date. Hepatic Cell Therapy Support SA Asset Acquisition In April 2021, the Company acquired 100% of the equity interest in Hepatic Cell Therapy Support SA (“Hepatic”) for approximately $15 million , net of cash acquired and debt assumed. Hepatic operates a manufacturing facility at the same location where Skeletal operates a cell therapy manufacturing facility in Gosselies, Belgium. The facility acquired will expand the C ompany’s cell therapy capacity for clinical and commercial supply in its Biologics segment. RheinCell Therapeutics GmbH Acquisition In June 2021, the Company entered into an agreement to acquire 100% of the equity interest in RheinCell for approximately $30 million and completed the acquisition in August 2021. RheinCell is a developer and manufacturer of cGMP-grade iPSCs. The operations acquired became part of the Company’s Biologics segment and build upon Catalent’s existing custom cell therapy process development and manufacturing capabilities with proprietary GMP cell lines for iPSC-based therapies. Due to the date of the closing, a preliminary purchase price allocation has not yet been performed. However, a portion of the purchase price is expected to be allocated to intangible assets and goodwill. Blow -Fill-Seal Divestitur e In March 2021, the Company sold 100% of the shares of Catalent USA Woodstock, Inc. and certain related assets (collectively, the “Blow-Fill-Seal Business”) for $300 million cash, a $50 million note receivable (estimated fair value of $47 million ) as well as potential additional contingent consideration (up to $50 million ) dependent upon the performance of aspects of the Blow-Fill-Seal Business. The Blow-Fill-Seal Business was part of the Oral and Specialty Delivery segment. The carrying value of the net assets sold was $149 million , which included goodwill of $54 million . As a result of the sale, the Company realized a gain from divestiture of $182 million , net of transaction costs, for the fiscal year ended June 30, 2021. As of December 31, 2020, the Blow-Fill-Seal Business was classified as held-for-sale. The Company determined that the sale of the business did not meet the criteria to be considered a discontinued operation as the disposal of the Blow-Fill-Seal Business did not represent a strategic shift that has (or will have) a major effect on the Company's financial results upon disposal. All consideration received was measured at its divestiture date fair value. The Company valued the total consideration received from divestiture of the Blow-Fill-Seal Business as follows: (Dollars in millions) Fair value of consideration received Cash, gross $ 300 Note receivable (1) 47 Contingent consideration (2) — Other (3) (16) Total $ 331 (1) The note receivable, which provides for interest at a rate of 5.0% paid in kind, had an estimated fair value of $47 million at June 30, 2021, which is the $50 million aggregate principal amount less a $3 million discount determined using a discounted cash flow model with the market interest rate as a significant input. (2) The Company determined that the estimated fair value of the contingent consideration from the sale of the Blow-Fill-Seal Business at June 30, 2021 was zero, and therefore no contingent consideration was recorded at divestiture. If any contingent consideration is subsequently received, it will be recorded in the period in which it is received. The Company has elected an accounting policy to recognize increases in the carrying amount of the contingent consideration asset using the gain contingency guidance in ASC 450, Contingencies . (3) Other includes $8 million of transaction expenses, a working capital adjustment of $6 million , and $2 million assumption of liabilities resulting in net cash proceed of $287 million for the fiscal year ended June 30, 2021, with an additional $3 million accrued at June 30, 2021 as a post-closing purchase price adjustment. The final post-closing purchase price adjustment was paid by the Company in August 2021. |
Goodwill
Goodwill | 12 Months Ended |
Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | GOODWILL The following table summarizes the changes from June 30, 2019 to June 30, 2020 and then to June 30, 2021 in the carrying amount of goodwill in total and by reporting segment: (Dollars in millions) Biologics Softgel and Oral Technologies Oral and Specialty Delivery Clinical Supply Services Total Balance at June 30, 2019 $ 1,320 $ 409 $ 340 $ 152 $ 2,221 Additions (1) 264 — — — 264 Reallocation (2) (124) 108 16 — — Other 3 (2) 2 — 3 Foreign currency translation adjustments — (10) (3) (4) (17) Balance at June 30, 2020 1,463 505 355 148 2,471 Additions (3) 54 — 2 — 56 Divestitures (4) — — (54) — (54) Foreign currency translation adjustments 14 11 13 8 46 Balance at June 30, 2021 $ 1,531 $ 516 $ 316 $ 156 $ 2,519 (1) The increase in fiscal 2020 primarily relates to the MaSTherCell acquisition. See Note 3, Business Combinations and Divestitures . (2) The reallocation in fiscal 2020 relates to adjustments to the Company’s reporting segments, as a result of which certain assets moved from the Biologics segment to the Oral and Specialty Delivery segment, and other assets moved from the Oral and Specialty Delivery segment to the Softgel and Oral Technologies segment. (3) The addition in the Biologics segment relates to the Skeletal and Delphi acquisitions. The addition in the Oral and Specialty Delivery segment relates to the Acorda transaction. For further details, see Note 3, Business Combinations and Divestitures . |
Definite Lived Long-Lived Asset
Definite Lived Long-Lived Assets | 12 Months Ended |
Jun. 30, 2021 | |
Finite lived intangible assets disclosure [Abstract] | |
Definite Lived Long-Lived Assets | OTHER INTANGIBLES, NET The details of other intangible assets subject to amortization as of June 30, 2021 and June 30, 2020 are as follows (in millions): June 30, 2021 Weighted Average Life Gross Carrying Value Accumulated Amortization Net Carrying Value Amortized intangibles: Core technology 19 years $ 140 $ (94) $ 46 Customer relationships 14 years 1,024 (306) 718 Product relationships 11 years 281 (237) 44 Other 5 years 17 (8) 9 Total other intangibles $ 1,462 $ (645) $ 817 June 30, 2020 Weighted Average Life Gross Carrying Value Accumulated Amortization Net Carrying Value Amortized intangibles: Core technology 19 years $ 135 $ (83) $ 52 Customer relationships 14 years 1,021 (248) 773 Product relationships 11 years 270 (217) 53 Other 5 years 16 (5) 11 Total other intangibles $ 1,442 $ (553) $ 889 Amortization expense was $93 million, $89 million, and $88 million for the fiscal years ended June 30, 2021, 2020, and 2019, respectively. Future amortization expense for the next five fiscal years is estimated to be: (Dollars in millions) 2022 2023 2024 2025 2026 Amortization expense $ 93 $ 92 $ 91 $ 90 $ 83 |
Restructuring and Other Costs
Restructuring and Other Costs | 12 Months Ended |
Jun. 30, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Other Costs | RESTRUCTURING COSTS From time to time, the Company has implemented plans to restructure certain operations, both domestically and internationally. The restructuring plans focused on various aspects of operations, including closing and consolidating certain manufacturing operations, rationalizing headcount and aligning operations in a strategic and more cost-efficient structure. In addition, the Company may incur restructuring charges in the future in cases where a material change in the scope of operation with its business occurs. Employee-related costs consist primarily of severance costs and also include outplacement services provided to employees who have been involuntarily terminated and duplicate payroll costs during transition periods. Facility exit and other costs consist of accelerated depreciation, equipment relocation costs, and costs associated with planned facility closures to streamline Company operations. During the fiscal year ended June 30, 2021, the Company adopted a plan to reduce costs and optimize its infrastructure in Europe by closing its Clinical Supply Services facility in Bolton, U.K. In connection with this restructuring plan, the Company expects to reduce its headcount between 150 and 180 employees through December 31, 2021 and estimates that it will incur charges between $7 million and $8 million, primarily associated with employee severance benefits. For the fiscal year ended June 30, 2021, restructuring charges associated with the Bolton facility closure were $7 million. During the fiscal year ended June 30, 2020, no significant restructuring plan was adopted. During the fiscal year ended June 30, 2019, the Company adopted a plan to restructure its workforce following a temporary suspension of operations at a Softgel and Oral Technology facility. The following table summarizes the costs recorded within restructuring costs: Fiscal Year Ended June 30, (Dollars in millions) 2021 2020 2019 Restructuring costs: Employee-related reorganization $ 8 $ 6 $ 14 Facility exit and other costs 2 — — Total restructuring costs $ 10 $ 6 $ 14 |
Long-Term Obligations and Other
Long-Term Obligations and Other Short-Term Borrowings | 12 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Long-Term Obligations and Other Short-Term Borrowings | LONG-TERM OBLIGATIONS AND SHORT-TERM BORROWINGS Long-term obligations and short-term borrowings consist of the following at June 30, 2021 and June 30, 2020: (Dollars in millions) Maturity as of June 30, 2021 June 30, 2021 June 30, 2020 Senior secured credit facilities Term loan facility B-2 May 2026 $ — $ 938 Term loan facility B-3 February 2028 997 — Revolving credit facility May 2024 — — 4.875% senior notes due 2026 January 2026 — 450 5.000% senior notes due 2027 July 2027 500 500 2.375% Euro-denominated senior notes due 2028 (1) March 2028 984 926 3.125% senior notes due 2029 February 2029 550 — Deferred purchase consideration October 2021 50 98 Financing lease obligations 2021 to 2038 193 142 Other obligations 2021 to 2028 3 1 Debt issuance costs (36) (37) Total debt 3,241 3,018 Less: current portion of long-term obligations and other short-term 75 73 Long-term obligations, less current portion $ 3,166 $ 2,945 (1) The increase in euro-denominated debt at June 30, 2021 compared to the prior year is primarily due to fluctuations in foreign currency exchange rates. Senior Secured Credit Facilities and Fifth Amendment to the Credit Agreement In February 2021, Operating Company completed Amendment No. 5 (the "Fifth Amendment") to its Amended and Restated Credit Agreement, dated as of May 20, 2014 (as subsequently amended, the "Credit Agreement"). Pursuant to the Fifth Amendment, Operating Company refinanced the existing $933 million aggregate principal amount of U.S. dollar-denominated term loans (the "Term B-2 Loans") with the proceeds of an equivalent amount of new U.S. dollar-denominated term loans (the "Term B-3 Loans"), incurred an additional $67 million aggregate principal amount of Term B-3 Loans, and obtained an additional $175 million of revolving credit commitments (the "Incremental Revolving Credit Commitments") under the Credit Agreement's revolving credit facility (the "Revolving Credit Facility"). The Term B-3 Loans constitute a new class of term loans under the Credit Agreement, with an interest rate of one-month LIBOR (subject to a floor of 0.50%) plus 2.00% per annum, a maturity date of February 2028 and quarterly amortization of principal equal to 0.25% with payments on the last business day of March, June, September, and December. The proceeds of the Term B-3 Loans, after payment of the offering fees and expenses, were used to repay in full the existing Term B-2 Loans under the Credit Agreement, plus any accrued and unpaid interest thereon, with the remainder available for general corporate purposes. The Incremental Revolving Credit Commitments constitute revolving credit commitments under the Revolving Credit Facility. The applicable rate for all revolving credit facility commitments under the Revolving Credit Facility is initially LIBOR plus 2.25% and such rate can additionally be reduced to LIBOR plus 2.00% in future periods based on a measure of Operating Company's total leverage ratio. The maturity date for the Revolving Credit Facility is the earlier of (i) May 17, 2024 and (ii) the 91st day prior to the maturity of the Term B-3 Loans. In addition, pursuant to the Fifth Amendment, certain modifications were made to the Credit Agreement in order to, among other things, provide for determination of a benchmark replacement interest rate when LIBOR is no longer available. The availability of capacity under the Revolving Credit Facility is reduced by the aggregate value of all outstanding letters of credit under the Credit Agreement. As of June 30, 2021, Operating Company had $719 million of unutilized capacity under the Revolving Credit Facility due to $6 million of outstanding letters of credit. 5.000% Senior Notes due 2027 In June 2019, Operating Company completed a private offering of $500 million aggregate principal amount of 5.000% Senior Notes due 2027 (the “2027 Notes”). The 2027 Notes are fully and unconditionally guaranteed, jointly and severally, by all of the wholly owned U.S. subsidiaries of Operating Company that guarantee its senior secured credit facilities. The 2027 Notes were offered in the U.S to qualified institutional buyers in reliance on Rule 144A under the Securities Act and outside the U.S only to non-U.S. investors pursuant to Regulation S under the Securities Act. The 2027 Notes will mature on July 15, 2027 and bear interest at the rate of 5.000% per annum. Interest is payable semi-annually in arrears on January 15 and July 15 of each year, beginning on January 15, 2020. The proceeds of the 2027 Notes after payment of the offering fees and expenses were used to repay in full the borrowings under Operating Company’s then-outstanding term loans under its senior secured credit facilities that would otherwise have matured in May 2024. 2.375% Euro-denominated Senior Notes due 2028 In March 2020, Operating Company completed a private offering of €825 million aggregate principal amount of 2.375% Senior Notes due 2028 (the "2028 Notes"). The 2028 Notes are fully and unconditionally guaranteed, jointly and severally, by all of the wholly owned U.S. subsidiaries of Operating Company that guarantee its senior secured credit facilities. The Euro 2028 Notes were offered in the U.S. to qualified institutional buyers in reliance on Rule 144A under the Securities Act and outside the U.S. only to non-U.S. investors pursuant to Regulation S under the Securities Act. The 2028 Notes will mature on March 1, 2028 and bear interest at the rate of 2.375% per annum. Interest is payable semi-annually in arrears on March 1 and September 1 of each year. The proceeds of the 2028 Notes after payment of the offering fees and expenses were used to repay in full the borrowings then outstanding under Operating Company's euro-denominated term loans under its senior secured credit facilities, which would have matured in May 2024, and repay in full Operating Company's euro-denominated 4.75% Senior Notes due 2024 (the “2024 Notes”), which would have matured in December 2024, plus any accrued and unpaid interest thereon, with the remainder available for general corporate purposes. 3.125% Senior Notes due 2029 In February 2021, Operating Company completed a private offering of $550 million aggregate principal amount of 3.125% Senior Notes due 2029 (the "2029 Notes" and, together with the 2027 Notes and the 2028 Notes, the "Senior Notes"). The 2029 Notes are fully and unconditionally guaranteed, jointly and severally, by all of the wholly owned U.S. subsidiaries of Operating Company that guarantee its senior secured credit facilities. The 2029 Notes will mature on February 15, 2029 and bear interest at the rate of 3.125% per annum payable semi-annually in arrears on February 15 and August 15 of each year, beginning on August 15, 2021. The proceeds of the 2029 Notes after payment of the offering fees and expenses were used to repay in full the outstanding borrowings under Operating Company's 4.875% Senior Notes due 2026. which would have matured in January 2026 (the "2026 Notes") plus any accrued and unpaid interest thereon, with the remainder available for general corporate purposes. Deferred Purchase Consideration In connection with the acquisition of Cook Pharmica LLC (now Catalent Indiana, LLC) in October 2017, $200 million of the $950 million aggregate nominal purchase price is payable in $50 million installments, on each of the first four anniversaries of the closing date. The Company made installment payments in October 2018, 2019, and 2020. The balance of the deferred purchase consideration was recorded at fair value as of the acquisition date, with the difference between the remaining nominal amount and the fair value as of any relevant period end treated as imputed interest. Long-Term and Other Obligations Other obligations consist primarily of finance leases for buildings and other loans for business and working capital needs. Maturities of long-term obligations, including finance leases of $193 million, and other short-term borrowings for future fiscal years are: (Dollars in millions) 2022 2023 2024 2025 2026 Thereafter Total Maturities of long-term and other obligations $ 75 $ 23 $ 24 $ 22 $ 20 $ 3,113 $ 3,277 Debt Issuance Costs Debt issuance costs associated with the Credit Agreement (other than its Revolving Credit Facility component) and the Senior Notes are presented as a reduction to the carrying value of the related debt, while debt issuance costs associated with the Revolving Credit Facility are capitalized within other long-term assets on the consolidated balance sheet. All debt issuance costs are amortized over the life of the related obligation through charges to interest expense in the consolidated statements of operations. The unamortized total debt issuance costs, including the costs associated with the Revolving Credit Facility capitalized within other long-term assets, were $38 million and $39 million as of June 30, 2021 and 2020, respectively. Amortization of debt issuance costs totaled $6 million and $6 million for the fiscal years ended June 30, 2021 and 2020, respectively. Guarantees and Security Senior Secured Credit Facilities All obligations under the Credit Agreement, and the guarantees of those obligations, are secured by substantially all of the following assets of Operating Company and each guarantor (Operating Company's parent entity, PTS Intermediate, and each of Operating Company's material domestic subsidiaries), subject to certain exceptions: • a pledge of 100% of the capital stock of Operating Company and 100% of the equity interests directly held by Operating Company and each guarantor in any wholly owned material subsidiary of Operating Company or any guarantor (which pledge, in the case of any non-U.S. subsidiary of a U.S. subsidiary, will not include more than 65% of the voting stock of such non-U.S. subsidiary); and • a security interest in, and mortgages on, substantially all tangible and intangible assets of Operating Company and of each guarantor, subject to certain limited exceptions. The Senior Notes All obligations under the Senior Notes are general, unsecured, and subordinated to all existing and future secured indebtedness of the guarantors to the extent of the value of the assets securing such indebtedness. Each of the Senior Notes is separately guaranteed by all of Operating Company's wholly owned U.S. subsidiaries that guarantee the senior secured credit facilities. None of the Senior Notes is guaranteed by either PTS Intermediate or the Company. Debt Covenants Senior Secured Credit Facilities The Credit Agreement contains a number of covenants that, among other things, restrict, subject to certain exceptions, Operating Company’s (and Operating Company’s restricted subsidiaries’) ability to incur additional indebtedness or issue certain preferred shares; create liens on assets; engage in mergers and consolidations; sell assets; pay dividends and distributions or repurchase capital stock; repay subordinated indebtedness; engage in certain transactions with affiliates; make investments, loans or advances; make certain acquisitions; enter into sale and leaseback transactions; amend material agreements governing Operating Company's subordinated indebtedness and change Operating Company's lines of business. The Credit Agreement also contains change of control provisions and certain customary affirmative covenants and events of default. The Revolving Credit Facility requires compliance with a net leverage covenant when there is a 30% or more draw outstanding at a period end. As of June 30, 2021, the Company was in compliance with all material covenants under the Credit Agreement. Subject to certain exceptions, the Credit Agreement permits Operating Company and its restricted subsidiaries to incur certain additional indebtedness, including secured indebtedness. None of Operating Company’s non-U.S. subsidiaries nor its dormant Puerto Rico subsidiary is a guarantor of the loans. Under the Credit Agreement, Operating Company’s 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 defined as “ Consolidated EBITDA ” in the Credit Agreement). Adjusted EBITDA is based on the definitions in the Credit Agreement, is not defined under U.S. GAAP, and is subject to important limitations. The Senior Notes The various indentures governing the Senior Notes (collectively, the “ Indentures ” ) contain covenants that, among other things, limit the ability of Operating Company and its restricted subsidiaries to incur or guarantee more debt or issue certain preferred shares; pay dividends on, repurchase, or make distributions in respect of their capital stock or make other restricted payments; make certain investments; sell certain assets; create liens; consolidate, merge, sell; or otherwise dispose of all or substantially all of their assets; enter into certain transactions with their affiliates, and designate their subsidiaries as unrestricted subsidiaries. These covenants are subject to a number of exceptions, limitations, and qualifications as set forth in the Indentures. The Indentures also contain customary events of default, including, but not limited to, nonpayment, breach of covenants, and payment or acceleration defaults in certain other indebtedness of Operating Company or certain of its subsidiaries. Upon an event of default, either the holders of at least 30% in principal amount of each of the then-outstanding Senior Notes or the applicable Trustee under the Indentures may declare the applicable notes immediately due and payable; or in certain circumstances, the applicable notes will automatically become immediately due and payable. As of June 30, 2021, Operating Company was in compliance with all material covenants under the Indentures. Estimated Fair Value of Debt Measurements The estimated fair values of the senior secured credit facilities and Senior Notes are classified as Level 2 (see Note 10, Fair Value Measurements for a description of the method by which fair value classifications are determined) in the fair value hierarchy and are calculated by using a discounted cash flow model with market interest rate as a significant input. The carrying amounts and the estimated fair values of financial instruments as of June 30, 2021 and June 30, 2020 are as follows: June 30, 2021 June 30, 2020 (Dollars in millions) Fair Value Measurement Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value 4.875% Senior Notes due 2026 Level 2 $ — $ — $ 450 $ 464 5.000% Senior Notes due 2027 Level 2 500 539 500 538 2.375% Euro-denominated Senior Notes due 2028 Level 2 984 993 926 844 3.125% Senior Notes due 2029 Level 2 550 524 — — Senior secured credit facilities & other Level 2 1,243 1,209 1,179 1,160 Subtotal $ 3,277 $ 3,265 $ 3,055 $ 3,006 Debt issuance costs (36) — (37) — Total debt $ 3,241 $ 3,265 $ 3,018 $ 3,006 |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS PER SHARE The Company computes earnings per share ( “ EPS ” ) of the Common Stock using the two-class method required due to the participating nature of the Series A Preferred Stock (as noted in Note 13, Equity, Redeemable Preferred Stock and Accumulated Other Comprehensive Loss) . The weighted-average number of shares outstanding utilized in diluted earnings per share is computed using the weighted-average number of common shares outstanding plus the number of common shares that would be issued assuming exercise or conversion of all potentially dilutive instruments. Dilutive securities having an anti-dilutive effect on diluted net income per share are excluded from the calculation. The dilutive effect of the securities that are issuable under the Company’s equity incentive plans (see Note 14, Stock-Based Compensation ) are reflected in diluted earnings per share by application of the treasury stock method. The Company applies the if-converted method to compute the potentially dilutive effect of the Series A Preferred Stock. The reconciliations between basic and diluted earnings per share attributable to Catalent common shareholders for the fiscal years ended June 30, 2021, 2020, and 2019 are as follows: Fiscal year ended June 30, (In millions, except per share data) 2021 2020 2019 Net earnings $ 585 $ 221 $ 137 Less: Net earnings attributable to preferred shareholders (56) (48) (5) Net earnings attributable to common shareholders $ 529 $ 173 $ 132 Weighted average shares outstanding - basic 168 150 144 Weighted average dilutive securities issuable - stock plans 2 2 2 Total weighted average shares outstanding - diluted 170 152 146 Earnings per share: Basic $ 3.15 $ 1.16 $ 0.92 Diluted $ 3.11 $ 1.14 $ 0.90 The Company's Series A Preferred Stock is deemed a participating security, meaning that it has the right to participate in undistributed earnings with the Company's Common Stock. On November 23, 2020 (the “Partial Conversion Date”), holders of Series A Preferred Stock converted 265,223 shares and $2 million of unpaid accrued dividends into shares of Common Stock (the “Partial Conversion”). The holders received 20.33 shares of Common Stock for each converted preferred share, resulting in the issuance of 5,392,280 shares of Common Stock. See Note 13, Equity, Redeemable Preferred Stock and Accumulated Other Comprehensive Loss for further details. The diluted weighted average number of shares outstanding for the fiscal years ended June 30, 2021, 2020 and 2019 did not include the weighted average number of shares of Common Stock associated with the Series A Preferred Stock reported below or the weighted average number of shares of Common Stock associated with the following types of outstanding equity grants due to their antidilutive effect: Fiscal year ended June 30, (share counts in millions) 2021 2020 2019 Stock options — — 2 Time-based restricted stock units — — 1 Performance-based restricted stock units — — 1 Series A Preferred Stock 10 13 2 |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 12 Months Ended |
Jun. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES Risk Management Objective of Using Derivatives The Company is exposed to fluctuations in the currency exchange rates applicable to its investments in foreign operations. While the Company does not actively hedge against changes in foreign currency, the Company has mitigated the exposure arising from its investments in its European operations by denominating a portion of its Senior Notes in euros. At June 30, 2021, the Company had euro-denominated debt outstanding of $984 million (U.S. dollar equivalent), which qualifies as a hedge of a net investment in foreign operations. For non-derivatives designated and qualifying as net investment hedges, the effective portion of the translation gains or losses are reported in accumulated other comprehensive income (loss) as part of the cumulative translation adjustment. The unhedged portions of the translation gains or losses are reported in the consolidated statements of operations. The following table includes net investment hedge activity during the fiscal years ended June 30, 2021 and 2020, respectively: (Dollars in millions) June 30, 2021 June 30, 2020 Unrealized foreign exchange gain (loss) within Other Comprehensive Income $ (56) $ 3 Unrealized foreign exchange gain (loss) within the Consolidated Statements of Operations $ (3) $ 6 The net accumulated gain of this net investment within accumulated other comprehensive loss was $6 million as of June 30, 2021. Amounts are reclassified out of accumulated other comprehensive loss into earnings when the entity in which the gains and losses reside is either sold or substantially liquidated. Preferred Stock Derivative Liability As discussed in Note 13, Equity, Redeemable Preferred Stock and Accumulated Other Comprehensive Loss, in May 2019, the Company issued shares of Series A Preferred Stock in exchange for net proceeds of $646 million after taking into account the $4 million issuance cost. The dividend rate used to determine the amount of the quarterly dividend payable on shares of the Series A Preferred Stock is subject to adjustment so as to provide holders of shares of Series A Preferred Stock with certain protections against a decline in the trading price of shares of Common Stock. The Company determined that this feature should be accounted for as a derivative liability, since the feature fluctuates inversely to changes in the trading price and is also linked to the performance of the S&P 500 stock index. Accordingly, the Company bifurcated the adjustable dividend feature from the remainder of the Series A Preferred Stock and accounted for this feature as a derivative liability at fair value. The Company recorded a gain of $17 million on the change in the estimated fair value of the derivative liability for the fiscal year ended June 30, 2021, which is reflected as other expense, net in the consolidated statements of operations. A portion of the derivative liability was settled on the Partial Conversion Date due to the Partial Conversion. The fair value of the derivative liability as of the Partial Conversion Date was $9 million, of which $4 million was related to the converted portion of the outstanding shares of Series A Preferred Stock. See Note 13, Equity, Redeemable Preferred Stock, and Accumulated Other Comprehensive Loss for details of the Partial Conversion. Interest-Rate Swap Pursuant to its interest rate and risk management strategy, in April 2020, the Company entered into an interest-rate swap agreement with Bank of America N.A. as a hedge against the economic effect of a portion of the variable interest obligation associated with its U.S dollar-denominated term loans under its senior secured credit facilities, so that the interest payable on that portion of the debt becomes fixed at a certain rate, thereby reducing the impact of future interest rate changes on future interest expense. In February 2021, in connection with the Fifth Amendment to the Credit Agreement, the Company settled the interest-rate swap agreement with Bank of America N.A. The Company paid $2 million in cash to Bank of America N.A to settle the interest-rate swap agreement. This loss is deferred in stockholders’ equity, net of income taxes, as a component of accumulated other comprehensive loss, and amortized as an adjustment to interest expense, net over the original term of the Term B-2 Loans. The net amount of deferred losses on cash flow hedges that is expected to be reclassified from accumulated other comprehensive loss into interest expense, net within the next twelve months is not material. In February 2021, the Company entered into a new interest-rate swap agreement with Bank of America N.A. as a hedge against the economic effect of a portion of the variable interest obligation associated with its Term B-3 Loans, so that the interest payable on that portion of the Term B-3 Loans becomes fixed at a certain rate, thereby reducing the impact of future interest rate changes on future interest expense. As a result of entering into the interest-rate swap agreement, the floating portion of the applicable rate on $500 million of the Term B-3 Loans is now effectively fixed at 0.9985%. The new interest-rate swap agreement qualifies for and is designated as a cash-flow hedge. The Company evaluates hedge effectiveness at the inception of the hedge and on an ongoing basis. The cash flows associated with the interest-rate swap are reported in net cash provided by operating activities in the consolidated statements of cash flows. A summary of the estimated fair value of the interest-rate swap reported in the consolidated balance sheets is stated in the table below: June 30, 2021 June 30, 2020 (in millions) Balance Sheet Classification Estimated Fair Value Balance Sheet Classification Estimated Fair Value Interest-rate swap Other long-term assets $ 2 Other liabilities $ 4 |
Fair Value Measures and Disclos
Fair Value Measures and Disclosures | 12 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures | FAIR VALUE MEASUREMENTS ASC 820, Fair Value Measurement , defines fair value as the exit price that would be received to sell an asset or paid to transfer a liability. Fair value is a market-based measurement that should be determined using assumptions that market participants would use in pricing an asset or liability. Valuation techniques used to measure fair value should maximize the use of observable inputs and minimize the use of unobservable inputs. To measure fair value, the Company uses the following fair value hierarchy based on three levels of inputs, of which Level 1 and Level 2 are considered observable and Level 3 is considered unobservable: Level 1 – Quoted prices in active markets for identical assets or liabilities. Level 2 – Inputs other than Level 1 that are observable for the asset or liability, either directly or indirectly, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data by correlation or other means. Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Value is determined using pricing models, discounted cash flow methodologies, or similar techniques and also includes instruments for which the determination of fair value requires significant judgment or estimation. Assets and Liabilities Measured at Fair Value on a Recurring Basis The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses of the Company approximate fair value based on the short maturities of these instruments. The Company evaluates its financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level of classification as of the end of each reporting period. The following table sets forth the Company’s financial assets and liabilities that were measured at fair value on a recurring basis and the fair value measurement for such assets and liabilities at June 30, 2021 and June 30, 2020, respectively: (Dollars in millions) Basis of Fair Value Measurement June 30, 2021 Total Level 1 Level 2 Level 3 Assets: Marketable securities $ 71 $ 71 $ — $ — Interest-rate swap 2 — 2 — Trading securities $ 1 $ 1 $ — $ — Liabilities: Series A Preferred Stock derivative liability $ 3 $ — $ — $ 3 June 30, 2020 Assets: Trading securities $ 1 $ 1 $ — $ — Liabilities: Series A Preferred Stock derivative liability $ 24 $ — $ — $ 24 Interest-rate swap $ 4 $ — $ 4 $ — The fair value of the interest-rate swap agreement is determined at the end of each reporting period based on valuation models that use interest-rate yield curves and discount rates as inputs. The discount rates are based on U.S. deposit or U.S. Treasury rates. The significant inputs used in the valuation models are readily available in public markets or can be derived from observable market transactions, and the valuation is therefore classified as Level 2 in the fair-value hierarchy. The estimated fair value of the Series A Preferred Stock derivative is determined using an option pricing methodology, specifically both a Monte Carlo simulation and a binomial lattice model. The methodology incorporates the terms and conditions of the preferred stock arrangement, historical stock price volatility, the risk-free interest rate, a credit spread based on the yield indexes of high-yield bonds, and the trading price of shares of the Common Stock. The calculation of the estimated fair value of the derivative liability is highly sensitive to changes in unobservable inputs, such as the expected volatility and the Company’s credit spread. The estimated fair value of the Series A Preferred Stock derivative liability is classified as Level 3 in the fair-value hierarchy due to the significant management judgment required to make the assumptions underlying the calculation of value. The following table sets forth a summary of changes in the estimated fair value of the Series A Preferred Stock derivative liability from June 30, 2020 to June 30, 2021: ( Dollars in millions) Fair Value Measurement of Balance at June 30, 2020 $ 24 Change in estimated fair value of Series A Preferred Stock derivative liability (17) Settlement of derivative liability upon Partial Conversion (4) Balance at June 30, 2021 $ 3 Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis Long-lived assets, goodwill, and other intangible assets are subject to non-recurring fair value measurement for the evaluation of potential impairment. Other than the fair value estimates disclosed in Note 3, Business Combinations and Divestitures , there was no non-recurring fair value measurement during the fiscal years ended June 30, 2021 and 2020. |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES Earnings before income taxes are as follows for fiscal 2021, 2020, and 2019: Fiscal Year Ended (Dollars in millions) 2021 2020 2019 U.S. operations $ 457 $ 121 $ 36 Non-U.S. operations 258 139 124 Total $ 715 $ 260 $ 160 The provision for income taxes consists of the following for fiscal 2021, 2020, and 2019: Fiscal Year Ended (Dollars in millions) 2021 2020 2019 Current: Federal $ 8 $ 1 $ 2 State and local 20 1 1 Non-U.S. 38 33 26 Total current expense $ 66 $ 35 $ 29 Deferred: Federal $ 62 $ 11 $ 4 State and local 7 6 (12) Non-U.S. (5) (13) 2 Total deferred expense (benefit) $ 64 $ 4 $ (6) Total provision $ 130 $ 39 $ 23 A reconciliation of the provision starting from the tax computed at the federal statutory income tax rate to the tax computed at the Company’s effective income tax rate is as follows for the fiscal years ended 2021, 2020, and 2019: Fiscal Year Ended (Dollars in millions) 2021 2020 2019 Provision at U.S. federal statutory tax rate $ 150 $ 55 $ 34 State and local income taxes 26 6 (1) Foreign tax rate differential (14) (6) (3) Global intangible low tax income 3 3 3 Other permanent items (5) 2 5 Unrecognized tax positions 3 (1) 1 Tax valuation allowance (7) (21) (11) Foreign tax credit (24) (3) (4) Withholding tax and other foreign taxes 1 1 1 Change in tax rate 2 4 1 R&D tax credit (5) (2) (2) Other — 1 (1) Total provision $ 130 $ 39 $ 23 The income tax provision for the fiscal year ended June 30, 2021 is not comparable to the provision in the prior year due to changes in the geographic mix of pretax income, changes in the tax impact of permanent differences and credits, and the tax impact of discrete items. The effective tax rate for the fiscal year ended June 30, 2021 reflects a tax expense for the sale of the Blow-Fill-Seal Business and an increase to state taxes, offset by an increase to the U.S. foreign tax credits as a result of amended prior year returns, as well as a reduction to the foreign valuation allowance. The effective tax rate for the fiscal year ended June 30, 2020 reflects a reduction to the federal and foreign valuation allowance partially offset by permanent items, and an increase in state tax. The Company intends to repatriate foreign earnings taxed in prior fiscal years as a result of the changes imposed by the 2017 U.S. Tax Cuts and Jobs Act. In addition to these foreign earnings previously taxed, as of June 30, 2021, for purposes of ASC 740-10-25-3, the Company had $142 million of undistributed earnings from non-U.S. subsidiaries that it intends to reinvest permanently in its non-U.S. operations. As these ASC 740-10-25-3 earnings are considered permanently reinvested, no tax provision has been accrued. It is not feasible to estimate the amount of tax that might be payable on the eventual remittance of such earnings. Deferred income taxes arise from temporary differences between the financial reporting and tax reporting bases of assets and liabilities, and operating loss and tax credit carryforwards for tax purposes. The components of the Company's deferred income tax assets and liabilities are as follows at June 30, 2021 and 2020: Fiscal Year Ended (Dollars in millions) 2021 2020 Deferred income tax assets: Accrued liabilities $ 43 $ 30 Equity compensation 15 16 Loss and tax credit carryforwards 187 194 Foreign currency 12 15 Pension 24 28 Interest-related 14 9 Deferred revenue 3 — Lease liabilities 35 34 Euro-denominated debt 23 7 Total deferred income tax assets $ 356 $ 333 Valuation allowance (65) (53) Net deferred income tax assets $ 291 $ 280 Fiscal Year Ended (Dollars in millions) 2021 2020 Deferred income tax liabilities: Deferred revenue $ — $ (8) Property-related (171) (100) Goodwill and other intangibles (194) (192) Right-of-use assets (18) (22) Other (6) (3) Total deferred income tax liabilities $ (389) $ (325) Net deferred tax liability $ (98) $ (45) Deferred tax assets and liabilities in the preceding table are in the following captions in the consolidated balance sheets at June 30, 2021 and 2020: Fiscal Year Ended (Dollars in millions) 2021 2020 Non-current deferred tax asset $ 66 $ 49 Non-current deferred tax liability 164 94 Net deferred tax liability $ (98) $ (45) At June 30, 2021, the Company had federal net operating loss ( “ NOL ” ) carryforwards of $512 million, $229 million of which are subject to limitations under Section 382 of the Internal Revenue Code of 1986, as amended (the “ Internal Revenue Code ” ). The majority of the $229 million federal NOL carryforwards subject to Section 382 of the Internal Revenue Code are attributed to the Company's acquisitions of Pharmatek Laboratories, Inc., Juniper Pharmaceuticals, Inc., Paragon Bioservices, Inc., and MaSTherCell. As of June 30, 2021, $432 million of the Company's federal NOL carryforwards have an indefinite life and the remaining NOL carryforwards will expire in fiscal years 2023 through 2037. At June 30, 2021, the Company had state tax NOL carryforwards of $441 million. Substantially all state NOL carryforwards have a twenty three The Company had valuation allowances of $65 million and $53 million as of June 30, 2021 and 2020, respectively, against its deferred tax assets. The Company considered all available evidence, both positive and negative, in assessing the need for a valuation allowance against tax assets. Four possible sources of taxable income were evaluated when assessing the realization of deferred tax assets: • carrybacks of existing NOLs (if and to the extent permitted under the tax law); • future reversals of existing taxable temporary differences; • tax planning strategies; and • future taxable income exclusive of reversing temporary differences and carryforwards. While the valuation allowance related to certain U.S. combined states was released during the fiscal year ended June 30, 2019, there remained as of June 30, 2021 a valuation allowance for the NOLs and deductible temporary differences in the remaining combined and separate states of $39 million. The state valuation allowance as of June 30, 2021 is due to the Company’s history of tax losses and anticipated loss utilization rates in separate filing status states as well as the difference in the rules related to allocated and apportioned income for separate filing status states versus combined filing status states. The Company considered the need to maintain a valuation allowance on deferred tax assets based on management’s assessment of whether it is more likely than not that the Company would realize the value of its deferred tax assets based on future reversals of existing taxable temporary differences and the ability to generate sufficient taxable income within the carryforward period available under the applicable tax laws. During the fiscal year ended June 30, 2021, the Company released $17 million of its valuation allowances. The amount released is related to $17 million of NOLs and temporary differences for certain Italian operations. The $17 million release of the Company’s valuation allowance was partially offset by establishing a $2 million valuation allowance on NOLs and temporary differences related to certain Canadian operations. In the normal course of business, the Company's income taxes are subject to audits by federal, state, and foreign tax authorities, some of which are ongoing and may result in proposed assessments. Germany and the U.K. are among the jurisdictions where the Company has substantial tax positions. The Company is no longer subject to examinations by the relevant tax authorities for years prior to fiscal 2009. The Company’s estimate for the potential outcome for any uncertain tax issue is highly judgmental. The Company assesses its income tax positions and records benefits for all years subject to examination based upon management’s evaluation of the facts, circumstances, and information available at the reporting date. For those tax positions for which it is more likely than not that a tax benefit will be sustained, the Company records the amount that has a greater than 50% likelihood of being realized upon resolution with the taxing authority that has full knowledge of all relevant information based on the technical merit. Interest and penalties are accrued, where applicable. As of June 30, 2021, the Company had a total of $5 million of unrecognized tax benefits. A reconciliation of unrecognized tax benefits, excluding accrued interest, as of June 30, 2021, 2020, and 2019 is as follows: (Dollars in millions) Balance at June 30, 2018 $ 2 Additions for tax positions of prior years 3 Lapse of the applicable statute of limitations (1) Balance at June 30, 2019 $ 4 Additions for tax positions of prior years 1 Lapse of the applicable statute of limitations (1) Balance at June 30, 2020 $ 4 Additions based on tax positions related to the current year 2 Additions for tax positions of prior years 1 Settlements (2) Balance at June 30, 2021 $ 5 All of the unrecognized tax benefits as of June 30, 2021 and 2020 would, if subsequently recognized, favorably affect the effective income tax rate. The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. As of June 30, 2021, the Company has $1 million of accrued interest related to uncertain tax positions, consistent with the prior year, as a result of an increase to certain tax positions taken in the fiscal year ended June 30, 2021, offset by a reduction to prior-year positions due to lapses in the statute of limitations. The Company had $1 million of accrued interest related to uncertain tax positions as of both June 30, 2020 and 2019. |
Employee Retirement Benefit Pla
Employee Retirement Benefit Plans | 12 Months Ended |
Jun. 30, 2021 | |
Retirement Benefits [Abstract] | |
Employee Retirement Benefit Plans | EMPLOYEE RETIREMENT BENEFIT PLANS The Company sponsors various retirement plans, including defined benefit pension plans and defined contribution plans. Substantially all of the Company’s domestic non-union employees are eligible to participate in employer-sponsored retirement savings plans, which include plans created under Section 401(k) of the Internal Revenue Code that provide for the Company to match a portion of contributions by participating U.S. employees. The Company’s contributions to the plans are discretionary but are subject to certain minimum requirements as specified in the plans. The Company uses a measurement date of June 30 for all of its retirement and postretirement benefit plans. The Company records obligations related to its withdrawal from one multi-employer pension plan that covered former employees at three former sites. This withdrawal was classified as a mass withdrawal under the Multiemployer Pension Plan Amendments Act of 1980, as amended, and the Pension Protection Act of 2006 and resulted in the recognition of liabilities associated with the Company’s long-term obligations in prior years not presented, which were primarily recorded as an expense within discontinued operations. The estimated discounted value of the projected contributions related to these plans is $38 million and $39 million as of June 30, 2021 and 2020, respectively. The annual cash impact associated with the Company’s long-term obligation arising from this plan is $2 million per year. The following table provides a reconciliation of the change in projected benefit obligation and fair value of plan assets for the defined benefit retirement and other retirement plans, excluding the multi-employer pension plan liability: Retirement Benefits Other Post-Retirement Benefits June 30, June 30, (Dollars in millions) 2021 2020 2021 2020 Accumulated Benefit Obligation $ 364 $ 351 $ 2 $ 3 Change in Benefit Obligation Benefit obligation at beginning of year 358 350 3 3 Company service cost 4 4 — — Interest cost 4 5 — — Curtailments — (1) — — Settlements — (4) — — Benefits paid (13) (11) (1) — Actuarial (gain) loss (9) 21 — — Exchange rate gain (loss) 28 (6) — — Benefit obligation at end of year $ 372 $ 358 $ 2 $ 3 Change in Plan Assets Fair value of plan assets at beginning of year 295 272 — — Actual return on plan assets (1) 31 — — Company contributions 11 12 — — Settlements — (4) — — Benefits paid (13) (11) — — Exchange rate gain (loss) 26 (5) — — Fair value of plan assets at end of year $ 318 $ 295 $ — $ — Funded Status Funded status at end of year (54) (63) (2) (3) Net pension liability $ (54) $ (63) $ (2) $ (3) The following table provides a reconciliation of the net amount recognized in the consolidated balance sheets: Retirement Benefits Other Post-Retirement Benefits June 30, June 30, (Dollars in millions) 2021 2020 2021 2020 Amounts Recognized in Statement of Financial Position Noncurrent assets $ 43 $ 32 $ — $ — Current liabilities (1) (1) — — Noncurrent liabilities (96) (94) (2) (3) Total liability (54) (63) (2) (3) Amounts Recognized in Accumulated Other Comprehensive Loss Prior service cost (1) (1) — — Net loss (gain) 62 62 (1) (1) Total accumulated other comprehensive loss (income) at the end of the fiscal year 61 61 (1) (1) Additional Information for Plan with ABO or PBO in Excess of Plan Assets Projected benefit obligation 130 165 2 3 Accumulated benefit obligation 124 159 2 3 Fair value of plan assets 32 70 — — Components of Net Periodic Benefit Cost Service cost 4 4 — — Interest cost 4 5 — — Expected return on plan assets (11) (11) — — Amortization of unrecognized: Net loss 3 5 — — Net periodic benefit cost $ — $ 3 $ — $ — Retirement Benefits Other Post-Retirement Benefits June 30, June 30, (Dollars in millions) 2021 2020 2021 2020 Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income Net (gain) loss arising during the year $ 3 $ 1 $ — $ — Net gain (loss) recognized during the year (3) (5) — — Total recognized in other comprehensive income $ — $ (4) $ — $ — Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Income Total recognized in net periodic benefit cost and other comprehensive income $ — $ (1) $ — $ — Estimated Amounts to be Amortized from Accumulated Other Comprehensive Income into Net Periodic Benefit Cost Amortization of: Net loss $ 3 $ 3 $ — $ — Financial Assumptions Used to Determine Benefit Obligations at the Balance Sheet Date Discount rate (%) 1.6 % 1.4 % 2.0 % 1.8 % Rate of compensation increases (%) 2.0 % 1.6 % n/a n/a Financial Assumptions Used to Determine Net Periodic Benefit Cost for Financial Year Discount rate (%) 1.4 % 1.9 % 1.8 % 3.0 % Rate of compensation increases (%) 2.0 % 2.0 % n/a n/a Expected long-term rate of return (%) 3.6 % 4.3 % n/a n/a Expected Future Contributions Fiscal year 2022 $ 8 $ 10 $ — $ — Retirement Benefits Other Post-Retirement Benefits June 30, June 30, (Dollars in millions) 2021 2020 2021 2020 Expected Future Benefit Payments Financial year 2022 $ 13 $ 12 $ — $ — 2023 14 12 — — 2024 15 13 — — 2025 15 14 — — 2026 15 14 — — 2027-2031 $ 84 $ 75 $ 1 $ 1 Actual Asset Allocation (%) Equities 4.4 % 9.7 % — % — % Government bonds 30.6 % 26.8 % — % — % Corporate bonds 21.0 % 24.8 % — % — % Property 3.5 % 3.1 % — % — % Insurance contracts 9.6 % 9.5 % — % — % Other 30.9 % 26.1 % — % — % Total 100.0 % 100.0 % — % — % Actual Asset Allocation (Amount) Equities $ 14 $ 29 $ — $ — Government bonds 97 79 — — Corporate bonds 67 73 — — Property 11 9 — — Insurance contracts 31 28 — — Other 98 77 — — Total $ 318 $ 295 $ — $ — Target Asset Allocation (%) Equities 4.5 % 10.1 % — % — % Government bonds 30.5 % 27.1 % — % — % Corporate bonds 21.1 % 24.5 % — % — % Property 3.5 % 3.1 % — % — % Insurance contracts 9.6 % 9.5 % — % — % Other 30.8 % 25.7 % — % — % Total 100.0 % 100.0 % — % — % The Company's Investment Committee employs a building-block approach in determining the long-term rate of return for plan assets, with proper consideration of diversification and rebalancing. Historical markets are studied and long-term historical relationships between equities and fixed income are preserved consistent with the widely accepted capital market principle that assets with higher volatility generate a greater return over the long run. Current market factors such as inflation and interest rates are evaluated before long-term capital market assumptions are determined. Peer data are reviewed to check for reasonability and appropriateness. Plan assets are recognized and measured at fair value in accordance with the accounting standards regarding fair value measurements. The following are valuation techniques used to determine the fair value of each major category of assets: • Short-term investments, equity securities, fixed-income securities, and real estate are valued using quoted market prices or other valuation methods, and thus are classified within Level 1 or Level 2. • Insurance contracts and other types of investments include investments with some observable and unobservable prices that are adjusted by cash contributions and distributions, and thus are classified within Level 2 or Level 3. The following tables provide a summary of plan assets that are measured at fair value as of June 30, 2021 and 2020, aggregated by the level in the fair value hierarchy within which those measurements fall: As of June 30, 2021 (dollars in millions) Level 1 Level 2 Level 3 Investments Measured at Net Asset Value Total Assets Equity securities $ — $ 14 $ — $ — $ 14 Debt securities — 164 — — 164 Real estate — 11 — — 11 Other (1) — 106 23 — 129 Total $ — $ 295 $ 23 $ — $ 318 (1) Other as of June 30, 2021, included $62 million of investments in hedge funds related to the Company's U.K. pension plan, which were classified as Level 2. As of June 30, 2020 (dollars in millions) Level 1 Level 2 Level 3 Investments Measured at Net Asset Value Total Assets Equity securities $ — $ 29 $ — $ — $ 29 Debt securities — 152 — — 152 Real estate — 7 — 2 9 Other (1) — 84 21 — 105 Total $ — $ 272 $ 21 $ 2 $ 295 (1) Other as of June 30, 2020, included $31 million of investments in hedge funds related to the Company's U.K. pension plan, which were classified as Level 2. Level 3 other assets as of June 30, 2021 and 2020 consist of an insurance contract in the U.K. to fulfill the benefit obligations for a portion of the participant benefits. The value of this commitment is determined using the same assumptions and methods used to value the pension liability of the associated plan. Level 3 other assets for the same periods also include the partial funding of a pension liability relating to current and former employees of the Company’s Eberbach, Germany facility through a Company promissory note with an annual rate of interest of 5%. The value of this commitment fluctuates due to contributions and benefit payments in addition to loan interest. The following table provides a reconciliation of the beginning and ending balances of Level 3 assets as well as the changes during the period attributable to assets held and those purchases, sales, settlements, contributions, and benefits that were paid: Fair Value Measurement Using Significant Unobservable Inputs Total (Level 3) Fair Value Measurement Using Significant Unobservable Inputs Insurance Contracts Fair Value Measurement Using Significant Unobservable Inputs Other Total (Level 3) (Dollars in millions) Beginning Balance at June 30, 2020 $ 21 $ 3 $ 18 Actual return on plan assets: Relating to assets still held at the reporting date 3 — 3 Purchases, sales, settlements, contributions and benefits paid (2) — (2) Transfers in or out of Level 3, net 1 — 1 Ending Balance at June 30, 2021 $ 23 $ 3 $ 20 The Company's investment policy reflects the long-term nature of the plans’ funding obligations. The assets are invested to provide the opportunity for both income and growth of principal. This objective is pursued as a long-term goal designed to provide required benefits for participants without undue risk. It is expected that this objective can be achieved through a well-diversified asset portfolio. All equity investments are made within the guidelines of quality, marketability, and diversification mandated by the Employee Retirement Income Security Act of 1974, as amended (for plans subject to the act) and other relevant legal requirements. Investment managers are directed to maintain equity portfolios at a risk level approximately equivalent to that of the specific benchmark established for that portfolio. Assets invested in fixed income securities and pooled fixed-income portfolios are managed actively to pursue opportunities presented by changes in interest rates, credit ratings, or maturity premiums. Other Post-Retirement Benefits Assumed Healthcare Cost Trend Rates at the Balance Sheet Date 2021 2020 Healthcare cost trend rate – initial (%) Pre-65 n/a n/a Post-65 7.3 % (1.1) % Healthcare cost trend rate – ultimate (%) Pre-65 n/a n/a Post-65 4.4 % 4.9 % Year in which ultimate rates are reached Pre-65 n/a n/a Post-65 2035 2032 |
Equity and Accumulated Other Co
Equity and Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Equity | EQUITY, REDEEMABLE PREFERRED STOCK AND ACCUMULATED OTHER COMPREHENSIVE LOSS Description of Capital Stock The Company is authorized to issue 1,000,000,000 shares of its Common Stock and 100,000,000 shares of preferred stock, par value $0.01 per share. In accordance with the Company’s amended and restated certificate of incorporation, each share of Common Stock has one vote, and the Common Stock votes together as a single class. Public Offerings of Common Stock On June 15, 2020, the Company completed a public offering of its Common Stock (the “June 2020 Equity Offering”), in which the Company sold 7.7 million shares of Common Stock at a price of $70.72 per share, net of underwriting discounts and commissions. The Company obtained total net proceeds from the June 2020 Equity Offering of $548 million after the payment of associated offering expenses. The net proceeds of the June 2020 Equity Offering were used to repay $200 million of prophylactic borrowings from the third quarter of fiscal 2020 under Operating Company's Revolving Credit Facility, with the remainder available for general corporate purposes. On July 10, 2020, the underwriter for the June 2020 Equity Offering exercised its over-allotment option on 1.2 million additional shares, resulting in net proceeds of $82 million from the June 2020 Equity Offering, which was recorded in the fiscal year ended June 30, 2021. On February 6, 2020, the Company completed the February 2020 Equity Offering, in which the Company sold 8.4 million shares of Common Stock at a price of $58.58 per share, net of underwriting discounts and commissions. The Company obtained total net proceeds from the February 2020 Equity Offering of $494 million. The net proceeds of the February 2020 Equity Offering were used to repay $100 million of borrowings earlier in the quarter under Operating Company's Revolving Credit Facility and the consideration for the MaSTherCell acquisition due at its closing, with the remainder available for general corporate purposes. Effect of Restricted Stock Shares outstanding of Common Stock include shares of unvested restricted stock. Unvested restricted stock included in reportable shares outstanding as of June 30, 2021 was not material. Shares of unvested restricted stock are excluded from the calculation of basic weighted average shares outstanding, but their dilutive impact is added back in the calculation of diluted weighted average shares outstanding. Redeemable Preferred Stock In May 2019, the Company designated 1,000,000 shares of its preferred stock, par value $0.01, as its “Series A Convertible Preferred Stock” (the “Series A Preferred Stock”), pursuant to a certificate of designation of preferences, rights, and limitations (as amended, the “Certificate of Designation”) filed with the Delaware Secretary of State, and issued and sold 650,000 shares of the Series A Preferred Stock for an aggregate purchase price of $650 million , to affiliates of Leonard Green & Partners, L.P., each share having an initial stated value of $1,000 (as such value may be adjusted in accordance with the terms of the Certificate of Designation). The Series A Preferred Stock ranks senior to the Company’s Common Stock with respect to dividend rights and rights upon the voluntary or involuntary liquidation, dissolution, or winding up of the affairs of the Company. Proceeds from the offering of the Series A Preferred Stock, net of stock issuance costs, were $646 million, of which $40 million was allocated to the dividend-adjustment feature at its issuance and separately accounted for as a derivative liability. Any change in the fair value of derivative liability during a fiscal quarter is recorded as a non-operating expense in the consolidated statement of operations. See Note 10, Fair Value Measurements, for detail concerning the change in fair value during the fiscal year ended June 30, 2021. As described in Note 8, Earnings per Share , on the Partial Conversion Date, holders of Series A Preferred Stock converted 265,223 shares (approximately 41% of their holdings) and $2 million of unpaid accrued dividends into shares of Common Stock. The holders received 20.33 shares of Common Stock for each converted preferred share, resulting in the issuance of 5,392,280 shares of Common Stock. There was no gain or loss recognized upon the Partial Conversion as it occurred in accordance with the terms of the Certificate of Designation. The Company has 384,777 shares of Series A Preferred Stock that remain outstanding at June 30, 2021. As a result of the Partial Conversion, additional paid in capital increased $253 million, which includes $4 million related to the fair value of the portion of the derivative liability that was settled upon the Partial Conversion and $2 million related to an unpaid accrued dividend. See Note 10, Fair Value Measurements, for detail concerning the change in fair value during the fiscal year ended June 30, 2021. The components of the changes in the cumulative translation adjustment, derivatives and hedges, minimum pension liability, and marketable securities for the fiscal years ended June 30, 2021, 2020, and 2019 consists of: Fiscal Year Ended June 30, (Dollars in millions) 2021 2020 2019 Foreign currency translation adjustments: Net investment hedge $ (56) $ 3 $ 12 Long-term inter-company loans 39 (9) (13) Translation adjustments 72 (25) (16) Total foreign currency translation adjustments, pretax 55 (31) (17) Tax expense (benefit) (12) — 2 Total foreign currency translation adjustments, net of tax $ 67 $ (31) $ (19) Net change in derivatives and hedges: Net gain (loss) recognized during the year, pretax $ 4 $ (4) $ — Tax expense (benefit) 1 (1) — Net change in derivatives and hedges, net of tax $ 3 $ (3) $ — Net change in minimum pension liability: Net gain (loss) recognized during the year, pretax $ — $ 4 $ (13) Tax expense (benefit) — 2 (4) Net change in minimum pension liability, net of tax $ — $ 2 $ (9) Net change in marketable securities: Net loss recognized during the year, pretax $ (1) $ — $ — Tax expense (benefit) — — — Net change in marketable securities, net of tax $ (1) $ — $ — Accumulated Other Comprehensive Loss Accumulated other comprehensive loss by component and changes for the fiscal years ended June 30, 2021, 2020, and 2019 consist of: (Dollars in millions) Foreign Currency Translation Adjustment Pension Liability Adjustments Derivatives and Hedges Marketable Securities Other Total Balance at June 30, 2018 $ (285) $ (40) $ — $ — $ (1) $ (326) Other comprehensive loss before reclassifications (19) — — — — (19) Amounts reclassified from Other Comprehensive Loss — (9) — — — (9) Balance at June 30, 2019 (304) (49) — — (1) (354) Other comprehensive loss before reclassifications (31) — (3) — — (34) Amounts reclassified from Other Comprehensive Loss — 2 — — — 2 Balance at June 30, 2020 (335) (47) (3) — (1) (386) Other comprehensive income (loss) before reclassifications 67 — 3 (1) — 69 Balance at June 30, 2021 $ (268) $ (47) $ — $ (1) $ (1) $ (317) |
Equity Based Compensation
Equity Based Compensation | 12 Months Ended |
Jun. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Shareholders' Equity and Share-based Payments | STOCK-BASED COMPENSATION The Company’s stock-based compensation is comprised of stock options, restricted stock units, performance-based restricted stock units, and restricted stock. 2014 and 2018 Omnibus Incentive Plans In connection with the IPO, the Company’s board of directors adopted, and the holder of a majority of the shares approved, the 2014 Omnibus Incentive Plan effective July 31, 2014 (the “2014 Plan”). The 2014 Plan provided certain members of management, employees, and directors of the Company and its subsidiaries with the opportunity to obtain various incentives, including grants of stock options, restricted stock units (defined below), and restricted stock. In October 2018, the Company’s shareholders approved the 2018 Omnibus Incentive Plan (the “2018 Plan”), and, as a result, new awards may no longer be issued under the 2014 Plan, although it remains in effect as to any previously granted award. The 2018 Plan is substantially similar to the 2014 Plan, except that (a) a total of 15,600,000 shares of Common Stock (subject to adjustment) may be issued under the 2018 Plan, (b) each share of Common Stock issuable under the 2018 Plan pursuant to a restricted stock or restricted stock unit award will reduce the number of reserved shares by 2.25 shares, and (c) the 2018 Plan imposes a limit on the aggregate value of awards that may be made in a single year to a non-employee director. Both the 2014 Plan and the 2018 Plan permit “net settlement” of vested awards, pursuant to which the award holder forfeits a portion of the vested award to satisfy the purchase price (in the case of options), the holder’s withholding tax obligation, if any (in all cases), or both. Where the holder net-settles the tax obligation, the Company pays the amount of the withholding tax to the U.S. government in cash, which is accounted for as an adjustment to Additional Paid in Capital. Stock Compensation Expense Stock compensation expense recognized in the consolidated statements of operations was $51 million, $48 million, and $33 million in fiscal 2021, 2020, and 2019, respectively. Stock compensation expense is classified in selling, general, and administrative expenses as well as cost of sales. The Company has elected to account for forfeitures as they occur. Stock Options Stock options granted under the 2014 Plan or 2018 Plan, as applicable, during fiscal 2021, 2020, and 2019 had an intrinsic value of $5 million, $6 million, and $24 million, respectively, which represents approximately 231,000, 329,000, and 1,179,000 shares of Common Stock, respectively. Each stock option granted under the 2014 Plan or 2018 Plan vests in equal annual installments over a four-year period from the date of grant, contingent upon the participant’s continued employment with the Company, except for a small number of grants that vest based on the achievement of operating performance targets set forth in the award documents. Methodology and Assumptions All outstanding stock options have an exercise price per share equal to the fair market value of one share of Common Stock on the date of grant. All outstanding stock options have a contractual term of 10 years, subject to forfeiture under certain conditions upon separation of employment. The grant-date fair value is recognized as expense on a graded-vesting basis over the vesting period. The fair value of stock options is determined using the Black-Scholes-Merton option pricing model for service and performance-based awards, and an adaptation of the Black-Scholes-Merton option valuation model, which takes into consideration the internal rate of return thresholds, for market-based awards. This model adaptation is essentially equivalent to the use of a path dependent-lattice model. The weighted average of assumptions used in estimating the fair value of stock options granted during each year were as follows: Fiscal Year Ended June 30, 2021 2020 2019 Expected volatility 27% 23 % - 24% 22 % - 24% Expected life (in years) 6.25 6.25 6.25 Risk-free interest rate 0.3% 1.7 % - 1.9% 2.2 % - 2.8% Dividend yield None None None Public trading of the Common Stock commenced only in July 2014, and, as a result, there is only available limited relevant historical volatility experience; therefore, the expected volatility assumption is based on the historical volatility of the closing share prices of a comparable peer group. The Company selected peer companies from the pharmaceutical industry with similar characteristics, including market capitalization, number of employees and product focus. In addition, since the Company does not have a pattern of exercise behavior of option holders, the Company used the simplified method to determine the expected life of each option, which is the mid-point between the vesting date and the end of the contractual term. The risk-free interest-rate for the expected life of the option is based on the comparable U.S. Treasury yield curve in effect at the time of grant. The weighted-average grant-date fair value of stock options in fiscal 2021, 2020, and 2019 was $24.36 per share, $15.22 per share, and $9.49 per share, respectively. The following table summarizes stock option activity and shares subject to outstanding options for the fiscal year ended June 30, 2021 : Time Performance Weighted Average Exercise Price Number of Shares Weighted Average Contractual Term Aggregate Intrinsic Value Number of Shares Weighted Average Contractual Term Aggregate Intrinsic Value Outstanding as of June 30, 2020 $ 35.53 1,997,888 8.63 $ 76,229,381 85,482 5.01 $ 2,453,938 Granted 88.10 231,352 — — — — — Exercised 26.25 870,210 — 63,527,893 2,492 — 222,251 Forfeited 48.83 73,855 — — 82,990 — — Expired / Canceled 41.16 5,001 — — — — — Outstanding as of June 30, 2021 49.77 1,280,174 4.92 74,696,700 — 0.00 — Vest and expected to vest as of June 30, 2021 49.77 1,280,174 4.92 74,696,700 — 0.00 — Vested and exercisable as of June 30, 2021 $ 38.14 480,235 6.69 $ 33,607,419 — 0.00 $ — In fiscal 2021, participants exercised options to purchase approximately 726,000 net settled shares, resulting in $27 million of cash paid on behalf of participants for withholding taxes. The intrinsic value of the options exercised in fiscal 2021 was $64 million. The total fair value of options vested during the period was $7 million. In fiscal 2020, participants exercised options to purchase approximately 166,000 net settled shares, resulting in $7 million of cash paid on behalf of participants for withholding taxes. The intrinsic value of the options exercised in fiscal 2020 was $18 million. The total fair value of options vested during the period was $4 million. As of June 30, 2021, $2 million of unrecognized compensation cost related to granted and not forfeited stock options is expected to be recognized as expense over a weighted-average period of approximately 1.8 years. Restricted Stock and Restricted Stock Units The Company may grant to employees and members of its board of directors under the 2018 Plan (and formerly granted under the 2014 Plan) shares of restricted stock and units each representing the right to one share of Common Stock (“restricted stock units”). Since the IPO, the Company has granted to employees and directors restricted stock units and restricted stock that vest over specified periods as well as restricted stock units and restricted stock that have certain performance-related vesting requirements (“performance stock units” and “performance stock,” respectively). The restricted stock and restricted stock units granted during fiscal 2021 and 2020 had grant date fair values aggregating $47 million and $43 million, respectively, which represent approximately 502,000 and 748,000 shares of Common Stock, respectively. Under the 2014 Plan or 2018 Plan, as appropriate, the performance stock and performance stock units vest upon achieving Company financial performance metrics established at the outset of the three-year performance period associated with each grant. The metrics for the fiscal 2019, 2020, and 2021 performance stock and performance stock unit grants were based on performance against a mix of adjusted EPS targets and relative total shareholder return ( “ RTSR ” ) targets. Note that adjusted EPS is calculated as a quotient of tax-effected Adjusted EBITDA by the weighted average number of fully diluted shares, a financial measure that is not defined under U.S. GAAP and is subject to important limitations. The performance stock and performance stock units vest following the end of their respective three-year performance periods upon a determination of achievement relative to the targets. Each quarter during the period in which the performance stock and performance stock units are outstanding, the Company estimates the likelihood of such achievement by the end of the performance period in order to determine the probability of vesting. The number of shares actually earned at the end of the three-year period for the fiscal 2019, 2020 and 2021 grants will vary, based only on actual performance, from 0% to 200%, or from 0% to 150%, of the target number of performance stock or performance stock units specified on the date of grant, in the case of adjusted EPS and RTSR grants, respectively. Time-based restricted stock units and restricted stock generally vest on the second or third anniversary of the date of grant, subject to the participant’s continued employment with the Company. Methodology and Assumptions - Expense Recognition and Grant Date Fair Value The fair values of (a) time-based restricted stock units and restricted stock are recognized as expense on a cliff-vesting schedule over the applicable vesting period and (b) performance shares and performance share units are re-assessed quarterly as discussed above. The grant date fair values of both time-based and performance-based shares and units are determined based on the number of shares subject to the grants and the fair value of the Common Stock on the dates of the grants, as determined by the closing market prices. Time-Based Restricted Stock Units and Restricted Stock The following table summarizes activity in unvested time-based restricted stock units and restricted stock for the fiscal year ended June 30, 2021: Time-Based Units and Shares Weighted Average Grant-Date Fair Value Unvested as of June 30, 2020 1,081,648 $ 47.45 Granted 283,495 93.58 Vested 492,274 43.62 Cancelled/forfeited/adjusted 108,513 57.85 Unvested as of June 30, 2021 764,356 65.54 Adjusted EPS and RTSR-Based Performance Share Units and Performance Shares The following table summarizes activity in unvested performance share units and performance shares for the fiscal year ended June 30, 2021: Performance-Based Units and Shares Weighted Average Grant-Date Fair Value Target Number Unvested as of June 30, 2020 516,416 $ 43.37 Target Number Granted 113,376 88.57 Target Number Vested 259,730 36.27 Target Number Cancelled/forfeited/adjusted (22,033) 47.47 Target Number Unvested as of June 30, 2021 392,095 $ 58.16 Valuation of RTSR Performance Shares and Performance Share Units The fair value of each RTSR performance share unit and performance share is determined using the Monte Carlo pricing model because the number of shares to be awarded is subject to a market condition. The Monte Carlo simulation is a generally accepted statistical technique used to simulate a range of possible future outcomes. Because the valuation model considers a range of possible outcomes, compensation cost is recognized regardless of whether the market condition is actually satisfied. The assumptions used in estimating the fair value of the RTSR performance share units and performance shares granted during each year were as follows: Fiscal Year Ended June 30, 2021 2020 Expected volatility 39 % - 42% 30 % - 31% Expected life (in years) 2.4 - 2.9 2.4 - 2.9 Risk-free interest rates 0.1 % - 0.2% 1.5 % - 1.8% Dividend yield None None The following table summarizes activity in unvested RTSR performance share units and performance shares for the fiscal year ended June 30, 2021: RTSR Units and Shares Weighted Average Grant-Date Fair Value Target Number Unvested as of June 30, 2020 427,903 $ 49.02 Target Number Granted 105,449 101.42 Target Number Vested 202,805 38.63 Target Number Cancelled/forfeited/adjusted 3,519 56.58 Target Number Unvested as of June 30, 2021 327,028 $ 68.92 In fiscal 2021, participants vested and settled 671,000 net settled shares, resulting in $31 million of cash paid on behalf of participants for withholding taxes. In fiscal 2020, participants vested and settled 734,000 net settled shares, resulting in $24 million of cash paid on behalf of participants for withholding taxes. |
Other Income _ Expense
Other Income / Expense | 12 Months Ended |
Jun. 30, 2021 | |
Other Income and Expenses [Abstract] | |
Other Income and Other Expense Disclosure | OTHER EXPENSE, NET The components of other expense, net for the fiscal years ended June 30, 2021, 2020, and 2019 are as follows: Fiscal Year Ended (Dollars in millions) 2021 2020 2019 Other (income) expense, net Debt refinancing costs (1) $ 18 $ 16 $ 16 Foreign currency (gains) and losses (2) 5 (3) — Other (3) (20) (5) (13) Total other expense, net $ 3 $ 8 $ 3 (1) Debt refinancing costs for the fiscal year ended June 30, 2021 includes (a) a write-off of $4 million of previously capitalized financing charges related to the Company’s repaid Term B-2 Loans and the 2026 Notes, (b) $3 million of financing charges related to the Company’s Term B-3 Loans, and (c) an $11 million premium on early redemption of the 2026 Notes. Debt financing costs for the fiscal year ended June 30, 2020 includes (x) a write-off of $6 million of previously capitalized financing charges related to the Company's repaid euro-denominated term loans under its senior secured credit facilities and the Company's redeemed 2024 Notes, and (y) a $10 million premium on early redemption of the 2024 Notes. Debt financing costs for the fiscal year ended June 30, 2019 includes $16 million of financing charges related to the offering of the 2028 Notes. (2) Foreign currency (gains) and losses include both cash and non-cash transactions. |
Leases
Leases | 12 Months Ended |
Jun. 30, 2021 | |
Leases [Abstract] | |
Leases of Lessee Disclosure | LEASES The Company leases certain manufacturing and office facilities, land, vehicles, and equipment. The terms of these leases vary widely, although most have terms between 3 and 10 years. In accordance with ASC 842 , Leases , the Company recognizes a “right-of-use” asset and related lease liability at the commencement date of each lease based on the present value of the fixed lease payments over the expected lease term. The lease term for this purpose will include any renewal period where the Company determines that it is reasonably certain that it will exercise the option to renew. While certain leases also permit the Company to terminate the lease in advance of the nominal term upon payment of an associated penalty, the Company generally does not take into account potential early termination dates in its determination of the lease term as it is reasonably certain not to exercise an early-termination option as of the lease commencement date. The Company uses its incremental borrowing rate, which represents the interest rate the Company would expect to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms, in order to calculate the present value of a lease, when the implicit discount rate for its leases is not readily determinable. Fixed lease payments are recognized on straight-line basis over the lease term, while variable payments are recognized in the period incurred. As permitted by ASC 842, the Company has elected not to separate those components of a lease agreement not related to the leasing of an asset from those components that are related. The Company does not record leases with an initial lease term of 12 months or less on its consolidated balance sheets. The Company recognizes lease expense for these short-term leases on a straight-line basis over the lease term. Supplemental information concerning the leases recorded in the Company's consolidated balance sheet as of June 30, 2021 is detailed in the following table: (Dollars in millions) Line item in the consolidated balance sheet Balance at Right-of-use assets: Finance leases Property, plant, and equipment, net $ 139 Operating leases Other long-term assets 84 Current lease liabilities: Finance leases Current portion of long-term obligations and other short-term borrowings 15 Operating leases Other accrued liabilities 16 Non-current lease liabilities: Finance leases Long-term obligations, less current portion 178 Operating leases Other liabilities $ 73 The components of the net lease costs for the fiscal year ended June 30, 2021 reflected in the Company's consolidated statement of operations were as follows: (Dollars in millions) Fiscal Year Ended Financing lease costs: Amortization of right-of-use assets $ 16 Interest on lease liabilities 11 Total 27 Operating lease costs 29 Variable lease costs 10 Total lease costs $ 66 The short-term lease cost amounted to $4 million during the fiscal year ended June 30, 2021. The weighted average remaining lease term and weighted average discount rate related to the Company's right-of-use assets and lease liabilities as of June 30, 2021 are as follows: Weighted average remaining lease term (years): Finance leases 12.6 Operating leases 11.8 Weighted average discount rate: Finance leases 7.2 % Operating leases 4.8 % Supplemental information concerning the cash-flow impact arising from the Company's leases for the fiscal year ended June 30, 2021 recorded in the Company's unaudited consolidated statement of cash flows is detailed in the following table (in millions): Fiscal Year Ended Cash paid for amounts included in lease liabilities: Financing cash flows used for finance leases $ 15 Operating cash flows used for finance leases 10 Operating cash flows used for operating leases 21 Non-cash transactions: Right-of-use assets obtained in exchange for new finance lease liabilities 57 Right-of-use assets obtained in exchange for new operating lease liabilities $ 13 As of June 30, 2021, the Company expects that its future minimum lease payments will become due and payable as follows: (Dollars in millions) Financing Leases Operating Leases Total 2022 $ 26 $ 18 $ 44 2023 25 17 42 2024 24 14 38 2025 22 11 33 2026 18 9 27 Thereafter 175 52 227 Total minimum lease payments 290 121 411 Less: interest 97 32 129 Total lease liabilities $ 193 $ 89 $ 282 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jun. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Contingent Losses From time to time, the Company may be involved in legal proceedings arising in the ordinary course of business, including, without limitation, inquiries and claims concerning environmental contamination as well as litigation and allegations in connection with acquisitions, product liability, manufacturing or packaging defects, and claims for reimbursement for the cost of lost or damaged active pharmaceutical ingredients, the cost of any of which could be significant. The Company intends to vigorously defend itself against any such litigation and does not currently believe that the outcome of any such litigation will have a material adverse effect on the Company’s financial statements. In addition, the healthcare industry is highly regulated and government agencies continue to scrutinize certain practices affecting government programs and otherwise. From time to time, the Company receives subpoenas or requests for information relating to the business practices and activities of customers or suppliers from various governmental agencies or private parties, including from state attorneys general, the U.S. Department of Justice, and private parties engaged in patent infringement, antitrust, tort, and other litigation. The Company generally responds to such subpoenas and requests in a timely and thorough manner, which responses sometimes require considerable time and effort and can result in considerable costs being incurred. The Company expects to incur costs in future periods in connection with future requests. |
Segment Information
Segment Information | 12 Months Ended | |
Jun. 30, 2021 | ||
Segment Reporting [Abstract] | ||
Segment Reporting Disclosure [Text Block] | SEGMENT AND GEOGRAPHIC INFORMATION As discussed in Note 1, Basis of Presentation and Summary of Significant Accounting Policies , the Company conducts its business within the following segments: Biologics, Softgel and Oral Technologies, Oral and Specialty Delivery, and Clinical Supply Services. The Company evaluates the performance of its segments based on segment revenue and segment earnings before non-controlling interest, other (income) expense, impairments, restructuring costs, interest expense, income tax (benefit) expense, and depreciation and amortization ( “ Segment EBITDA ” ). The Company considers its reporting segments results in the context of a similar Company-wide measure: EBITDA from operations, which the Company defines as consolidated earnings from operations before interest expense, income tax (benefit) expense, depreciation and amortization, adjusted for the income or loss attributable to non-controlling interest. Neither Segment EBITDA nor EBITDA from operations is defined under U.S. GAAP, and neither is a measure of operating income, operating performance, or liquidity presented in accordance with U.S. GAAP. Each of these non-GAAP measures is subject to important limitations. These consolidated financial statements include information concerning Segment EBITDA and EBITDA from operations (a) because Segment EBITDA and EBITDA from operations are operational measures used by management in the assessment of the operating segments, the allocation of resources to the segments, and the setting of strategic goals and annual goals for the segments, and (b) in order to provide supplemental information that the Company considers relevant for the readers of the consolidated financial statements, but such information is not meant to replace or supersede U.S. GAAP measures. The Company’s presentation of Segment EBITDA and EBITDA from operations may not be comparable to similarly titled measures used by other companies. The most directly comparable U.S. GAAP measure to EBITDA from operations is net earnings. Included in this Note is a reconciliation of net earnings to EBITDA from operations. The following tables include net revenue and Segment EBITDA for each of the Company's current reporting segments during the fiscal years ended June 30, 2021, 2020, and 2019: (Dollars in millions) Fiscal Year Ended June 30, 2021 2020 2019 Net revenue: Biologics $ 1,928 $ 1,021 $ 573 Softgel and Oral Technologies 1,012 1,062 1,039 Oral and Specialty Delivery 686 676 598 Clinical Supply Services 391 345 322 Inter-segment revenue elimination (19) (10) (14) Net revenue $ 3,998 $ 3,094 $ 2,518 (Dollars in millions) Fiscal Year Ended June 30, 2021 2020 2019 Segment EBITDA reconciled to net earnings: Biologics $ 608 $ 237 $ 147 Softgel and Oral Technologies 237 257 236 Oral and Specialty Delivery 160 201 175 Clinical Supply Services 108 91 85 Subtotal $ 1,113 $ 786 $ 643 Reconciling items to net earnings Unallocated costs (1) 1 (146) (143) Depreciation and amortization (289) (254) (229) Interest expense, net (110) (126) (111) Income tax expense (130) (39) (23) Net earnings $ 585 $ 221 $ 137 (1) Unallocated costs include restructuring and special items, stock-based compensation, gain (loss) on sale of subsidiary, impairment charges, certain other corporate directed costs, and other costs that are not allocated to the segments as follows: (Dollars in millions) Fiscal Year Ended June 30, 2021 2020 2019 Impairment charges and gain (loss) on sale of assets $ (9) $ (5) $ (5) Stock-based compensation (51) (48) (33) Restructuring and other special items (a) (31) (42) (58) Gain (loss) on sale of subsidiary (b) 182 (1) — Other expense, net (c) (3) (8) (3) Non-allocated corporate costs, net (87) (42) (44) Total unallocated costs $ 1 $ (146) $ (143) (a) Restructuring and other special items for the fiscal year ended June 30, 2021 include transaction and integration costs associated with the Anagni, MaSTherCell, Skeletal, Delphi, and Acorda acquisitions, and restructuring costs associated with the closure of the Company's Clinical Supply Services facility in Bolton, U.K. Restructuring and other special items during the fiscal year ended June 30, 2020 include transaction and integration costs associated with the Company’s cell and gene therapy acquisitions and the disposal of a facility in Australia. Restructuring and other special items during fiscal 2019 include transaction and integration costs associated with the acquisitions of Paragon Bioservices, Inc. and Juniper Pharmaceuticals, Inc., and the disposal of a facility in Australia. (b) Gain on sale of subsidiary for the fiscal year ended June 30, 2021 is affiliated with the sale of the Blow-Fill-Seal Business. Loss on sale of subsidiary for the fiscal year ended June 30, 2020 is affiliated with the disposal of the Australia facility. (c) Refer to Note 15, Other expense, net , for details of financing charges and foreign currency translation adjustments recorded within other expense, net. The following table includes total assets for each segment, as well as reconciling items necessary to total the amounts reported in the consolidated balance sheets. Total Assets (Dollars in millions) June 30, 2021 June 30, 2020 Biologics $ 4,973 $ 3,775 Softgel and Oral Technologies 1,604 1,502 Oral and Specialty Delivery 1,269 1,248 Clinical Supply Services 483 451 Corporate and eliminations 783 801 Total assets $ 9,112 $ 7,777 Capital Expenditures Fiscal Year Ended June 30, (Dollars in millions) 2021 2020 2019 Biologics $ 516 $ 330 $ 79 Softgel and Oral Technologies 61 54 83 Oral and Specialty Delivery 64 55 29 Clinical Supply Services 26 10 3 Corporate 19 17 24 Total capital expenditures $ 686 $ 466 $ 218 The following table presents long-lived assets (1) by geographic area: Long-Lived Assets (1) (Dollars in millions) June 30, 2021 June 30, 2020 United States $ 1,867 $ 1,396 Europe 541 405 Other 116 100 Total $ 2,524 $ 1,901 (1) Long-lived assets include property, plant, and equipment, net of accumulated depreciation. | [1] |
[1] | Refer to Note 15, Other expense, net , for details of financing charges and foreign currency translation adjustments recorded within other expense, net. |
Supplemental Balance Sheet Info
Supplemental Balance Sheet Information | 12 Months Ended |
Jun. 30, 2021 | |
Balance Sheet Related Disclosures [Abstract] | |
Supplemental Balance Sheet Information | SUPPLEMENTAL BALANCE SHEET INFORMATION Supplemental balance sheet information at June 30, 2021 and June 30, 2020 is detailed in the following tables. Inventories Work-in-process and inventories include raw materials, labor, and overhead. Total inventories consist of the following: (Dollars in millions) June 30, June 30, Raw materials and supplies $ 469 $ 223 Work-in-process 151 123 Total inventories, gross 620 346 Inventory cost adjustment (57) (22) Total inventories $ 563 $ 324 Prepaid expenses and other Prepaid expenses and other current assets consist of the following: (Dollars in millions) June 30, June 30, Prepaid expenses $ 46 $ 29 Contract assets 181 61 Spare parts supplies 30 23 Prepaid income tax 22 15 Non-U.S. value-added tax 50 19 Other current assets 47 31 Total prepaid expenses and other $ 376 $ 178 Property, plant, and equipment, net Property, plant, and equipment, net consist of the following: (Dollars in millions) June 30, June 30, Land, buildings, and improvements $ 1,571 $ 1,251 Machinery and equipment 1,558 1,233 Furniture and fixtures 31 21 Construction in progress 543 440 Property and equipment, at cost 3,703 2,945 Accumulated depreciation (1,179) (1,044) Property, plant, and equipment, net $ 2,524 $ 1,901 Other long-term assets Other long-term assets consist of the following: (Dollars in millions) June 30, June 30, Operating lease right-of-use-assets $ 84 $ 101 Note receivable 47 — Pension assets 43 32 Corporate-owned life insurance policies 35 23 Venture capital investments 38 5 Interest rate swap 2 — Other 19 13 Total other long-term assets $ 268 $ 174 Other accrued liabilities Other accrued liabilities consist of the following: (Dollars in millions) June 30, June 30, Contract liability $ 305 $ 191 Accrued employee-related expenses 184 141 Accrued expenses 170 115 Operating lease liabilities 16 15 Restructuring accrual 4 3 Accrued interest 27 29 Accrued income tax 30 5 Total other accrued liabilities $ 736 $ 499 |
Subsequent Events (Notes)
Subsequent Events (Notes) | 12 Months Ended |
Jun. 30, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | SUBSEQUENT EVENTS Bettera Holdings, LLC Purchase Agreement In August 2021, the Company entered into an agreement to acquire Bettera Holdings, LLC ("Bettera") for $1.00 billion, subject to customary adjustments. Bettera is a manufacturer of nutraceuticals and nutritional supplements in gummy, soft chew, and lozenge delivery formats. Upon closing, Bettera’s operations and facilities, will become part of the Company’s Softgel and Oral Technologies segment. The agreement is subject to customary closing conditions and is expected to close before December 31, 2021. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jun. 30, 2021 | |
Accounting Policies [Abstract] | |
Segment Reporting, Policy | Reporting Segments Each of the four reporting segments reports through a separate management team and ultimately reports to the Company's Chief Executive Officer, who is designated as the Chief Operating Decision Maker for segment reporting purposes. The Company's operating segments are the same as its reporting segments. Biologics The Company’s Biologics segment provides biologic cell-line, cell therapy and viral-based gene therapy development and manufacturing; formulation, development, and manufacturing for parenteral dose forms, including prefilled syringes, vials, and cartridges; and analytical development and testing services for large molecules. The segment has extensive expertise in development, scale up, and commercial manufacturing. The Company’s growing biologic offering includes cell-line development based on its advanced and patented GPEx suite of technologies, which are used to develop stable, high-yielding mammalian cell lines for both innovator and biosimilar biologic compounds. GPEx technology can provide rapid cell-line development, high biologics production yields, flexibility, and versatility. Its development and manufacturing facility in Madison, Wisconsin has the capability and capacity to produce current good manufacturing practices ("cGMP") quality biologics drug substance from 250L to 4,000L scale using single-use technology to provide maximum efficiency and flexibility. Its Bloomington, Indiana facility brings additional biologics development, clinical, and commercial drug substance manufacturing, and formulation capabilities and capacity. Both Bloomington and the Anagni, Italy facility add substantial capacity for finished-dose drug product manufacturing and packaging. The segment has continued to expand production capacity, including the fourth and fifth drug substance manufacturing suites in its Madison, Wisconsin facility, expanded drug product manufacturing and packaging capacity in its Bloomington and Anagni facilities, and recently announced a planned expansion of its Anagni facility to permit drug substance development and manufacturing. Its SMARTag next-generation antibody-drug conjugate (“ADC”) technology, based in Emeryville, California, is a clinical-stage technology that enables development of ADCs and other protein conjugates with improved efficacy, safety, and manufacturability. At the Company’s cell and gene therapy centers in Belgium, Maryland, and Texas, it develops and manufactures complex biologics, including CAR-T, AAV, lentivirus, oncolytic virus and other cell or virus modalities for cell- and viral-based therapies and next-generation vaccines. Through continued inorganic investment between November 2020 and June 2021, the Company acquired two additional cell and gene therapy manufacturing facilities and Delphi Genetics SA (“Delphi”), a plasmid DNA business, to create a European Center of Excellence in Belgium. This campus now includes clinical through commercial-scale cell therapy manufacturing and both small- and large-scale plasmid DNA production. Additionally, in August 2021, it acquired RheinCell Therapeutics GmbH (“RheinCell”), a company based in Lagenfeld, Germany that specializes in pluripotent stem cell (“iPSC”) production. This portfolio expansion strengthens Catalent’s cell therapy offering by adding proprietary cGMP iPSC cell lines and enhances the Company’s ability to manufacture next generation cell therapies at scale. In its gene therapy network across Maryland and Texas, the Company has further expanded its footprint with the construction of 5 additional commercial gene therapy suites at its Harmans commercial campus in Maryland, creating a total of 15 commercial suites, and repurposed its Rockville facility in Maryland for both small- and large-scale plasmid DNA production. Its specialized expertise in AAV vectors, the most commonly used delivery system for gene therapy, and both autologous and allogeneic cell therapy modalities, together with its expanded capabilities in plasmids, positions the Company to capitalize on strong and growing industry demand in the cell and gene therapy market. The segment's range of injectable manufacturing offerings includes manufacturing drug substance and filling small molecules or biologics into vials, syringes, and cartridges, with flexibility to accommodate other formats within the segment's existing network. In addition to primary packaging, its network provides secondary packaging capabilities, including auto-injector and safety device assembly for commercial launch and life cycle management. The Company's Clinical Supply Services business provides a global network for clinical distribution, as well as labeling, packaging and cold chain for clinical trial supply of biotherapeutics and cell and gene therapies. Its fill and finish services are largely focused on complex pharmaceuticals and biologics. With its range of technologies, the Company is able to meet a wide range of specifications, timelines, and budgets. The Company believes that the complexity of the manufacturing process, the importance of experience and know-how, regulatory compliance, and substantial capital requirements provide it with a meaningful competitive advantage in the market. The Biologics segment also offers biologics analytical development and testing services for large molecules, including bioassay, biophysical characterization, and cGMP release and stability testing. Its OneBio Suite provides customers the potential to seamlessly integrate drug substance, drug product, and clinical supply management for products in development, and for integrated commercial supply across both drug substance and drug product. The Biologics segment provides a broad range of technologies and services supporting the development and launch of new biologic entities, biosimilars, biobetters, and cell and gene therapies to bring a product from gene to commercialization, faster. Softgel and Oral Technologies Through its Softgel and Oral Technologies segment, the Company provides formulation, development, and manufacturing services for soft capsules, or “softgels,” as well as large-scale manufacturing of oral solid dose forms for pharmaceutical and consumer health markets, along with supporting ancillary services. Catalent’s softgel technology was first commercialized by its predecessor in the 1930s, and it has continually enhanced the platform since then. The segment is the market leader in overall softgel development and manufacturing and holds the leading market position in innovator drug softgels. Its principal softgel technologies include traditional softgel capsules, in which the shell is made of animal-derived gelatin, and Vegicaps and OptiShell capsules, in which the shell is made from plant-derived materials. Softgel capsules are used in a broad range of customer products, including prescription drugs, over-the-counter medications, dietary supplements, unit-dose cosmetics, and animal health medicinal preparations. Softgel capsules encapsulate liquid, paste, or oil-based formulations of active compounds in solution or suspension within an outer shell. In the manufacturing process, the capsules are formed, filled, and sealed simultaneously. The segment typically performs encapsulation for a product within one of its softgel facilities, with active ingredients provided by customers or sourced directly by the Company. Softgels have historically been used to solve formulation challenges or technical issues for a specific drug, to help improve the clinical performance of compounds, to provide important market differentiation, particularly for over-the-counter medications, and to provide safe handling of hormonal, highly potent, and cytotoxic drugs. The segment also participates in the softgel vitamin, mineral, and supplement business in selected regions around the world. With the 2001 introduction of the Company’s plant-derived softgel shell, Vegicaps capsules, consumer health customers have been able to extend the softgel dose form to a broader range of active ingredients and serve patient/consumer populations that were previously inaccessible due to religious, dietary, or cultural preferences. In recent years, the segment extended this platform to pharmaceutical products via its OptiShell capsule offering. Its Vegicaps and OptiShell capsules are protected by patents in most major global markets. Physician and patient studies the Company has conducted have demonstrated a preference for softgels versus traditional tablet and hard capsule dose forms in terms of ease of swallowing, real or perceived speed of delivery, ability to remove or eliminate unpleasant odor or taste, and, for physicians, perceived improved patient adherence with dosing regimens. Its large-scale manufacturing under cGMP of oral solid dose forms typically includes late-stage clinical trial supplies, registration batches, and commercial production across a broad range of formats, and may also involve advanced processing of intermediates to achieve the desired clinical performance of the prescription or over-the-counter pharmaceutical product. Finished dose forms include traditional and advanced complex oral solid-doses, including coated and uncoated tablets, pellet/bead/powder-filled two-piece hard capsules, granulated powders, and other immediate and modified release forms. Advanced intermediate processing may include coating, extrusion, or spheronization to achieve specific functional outcomes, including site or time-specific drug release, taste masking, or enhanced bioavailability. The Company has deep experience at managing complex technical transfers of clinical or commercial programs, whether from Catalent’s early development network in the Oral and Specialty Delivery segment, other contract development sites, or from customers directly. Oral and Specialty Delivery The Company’s Oral and Specialty Delivery segment provides advanced analytical and formulation development and manufacturing across a range of technologies along with integrated downstream clinical development and commercial supply solutions. The technologies cover a broad range of oral (including its proprietary fast-dissolve Zydis tablets and many bioavailability enhancement technologies for both immediate and controlled-release tablets and capsules), respiratory and inhaled dose forms (including metered dose inhalers, dry powder inhalers and nasal delivery devices). The segment provides comprehensive pre-clinical screening, formulation and analytical development, and cGMP manufacturing at both clinical and commercial scale for both traditional and advanced complex oral solid-dose formats. It has substantial, proven experience in developing and scaling up orphan and rare disease oral products, especially those requiring accelerated development timelines, solubility enhancement, specialized handling ( e.g ., potent or controlled substance materials), complex technology transfer and specialized manufacturing processes. It provides spray drying, hot melt extrusion, micronization, and lipid formulation capabilities, all of which are used to enhance a drug’s bioavailability and clinical performance. It offers comprehensive analytical method development and scientific capabilities, including stability testing, and global regulatory services to support both fully integrated development programs and standalone fee-for-service work. In recent years, the segment has expanded its network of clinical development sites focused on earlier phase compounds ( i.e ., pre-clinical and Phase I) to engage with more customer molecules earlier in their development, with the intent to also support these molecules downstream as they progress towards commercial approval and supply. Demand for its offerings is driven by the need for strong scientific expertise, the depth and breadth of integrated services offered, as well as the reliability of its supply performance across quality and operational parameters. The Company launched its orally dissolving tablet business in 1986 with the introduction of Zydis, a unique proprietary freeze-dried tablet that dissolves in the mouth, without water, in typically less than three seconds. The platform is often used for drugs that benefit from rapid oral dissolution and buccal absorption and for drugs for specialized patient groups, including geriatric or pediatric populations, that have difficulty swallowing (dysphagia). The Company can adapt the Zydis technology to a wide range of molecules and indications, including prescription treatments for a variety of central nervous system-related conditions such as migraine, Parkinson’s disease, and schizophrenia, and also for a range of consumer healthcare products targeting broader indications such as pain or allergy relief. It continues to invest in and develop Zydis orally dissolving tablets in different ways with its customers as it extends the application of the technology to new therapeutic categories, including immunotherapy, vaccines and biologic molecule delivery. The segment’s respiratory platform provides integrated molecule screening, formulation development, and commercial manufacturing services for inhaled products delivered via metered dose inhalers, dry powder inhalers, and intra-nasal sprays. Delivery of these inhaled combination device products requires specialized capabilities to account for both the molecule and the device, to ensure accurate repeatable dose delivery. Clinical Supply Services The Company’s Clinical Supply Services segment provides manufacturing, packaging, storage, distribution, and inventory management for drugs and biologics in clinical trials. It offers customers flexible solutions for clinical supplies production and provide distribution and inventory management support for both simple and complex clinical trials. This includes over-encapsulation where needed; supplying placebos, comparator drug procurement, and clinical packages and kits for physicians and patients; inventory management; investigator kit ordering and fulfillment; and return supply reconciliation |
Basis of Presentation | Basis of Presentation These financial statements include all of the Company’s subsidiaries, including those operating outside the United States ( “ U.S. ” ) and are prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). All significant transactions among the Company’s subsidiaries and reporting segments have been eliminated, other than as noted. |
Use of Estimates | Use of EstimatesThe preparation of financial statements in conformity with U.S. GAAP requires the Company's management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Such estimates include, but are not limited to, allowance for credit losses, inventory and long-lived asset valuation, goodwill and other intangible asset valuation and impairment, equity-based compensation, income taxes, derivative valuation, and pension plan asset and liability valuation. Actual amounts may differ from these estimated amounts. |
Reclassifications | ReclassificationCertain prior-period amounts were reclassified to conform to the current period presentation. These reclassifications did not have a material impact on the consolidated statements of operations, consolidated balance sheets, consolidated statements of cash flows, or notes to the consolidated financial statements. |
Translation and Transaction of Foreign Currencies | Foreign Currency Translation The financial statements of the Company’s operations outside the U.S. are generally measured using the local currency as the functional currency. Adjustments to translate the assets and liabilities of the foreign operations into U.S. dollars are accumulated as a component of other comprehensive income utilizing period-end exchange rates. Beginning on July 1, 2018, as a result of the three-year cumulative consumer price index exceeding 100%, the Company has accounted for its Argentine operations as highly inflationary, but this change has not had a material effect on the consolidated financial statements. The currency fluctuation related to certain long-term inter-company loans where settlement is not planned or anticipated in the foreseeable future have been recorded within the cumulative translation adjustment, a component of other comprehensive income. In addition, the currency fluctuation associated with the portion of the Company’s euro-denominated debt designated as a net investment hedge is included as a component of other comprehensive income. Foreign currency transaction gains and losses calculated by utilizing weighted average exchange rates for the period are included in the statements of operations in “ other expense, net. ” Such foreign currency transaction gains and losses include inter-company loans that are repayable in the foreseeable future. |
Cash and Cash Equivalents | Cash and Cash Equivalents All liquid investments purchased with original maturities of three months or less are considered cash equivalents. The carrying value of these cash equivalents approximates fair value. |
Receivables and Allowance dor Doubtful Accounts | Allowance for Credit Losses Trade receivables, contract assets, and other amounts owed to the Company are presented net of an allowance that includes an assessment of expected credit losses. The Company determines its allowance methodology by considering various factors, including the Company’s previous loss history, aging of customer receivable balances, significant aspects of a geographic location's economic conditions, the current and anticipated future condition of the general economy and the industries in which the Company's primary customers operate. To the extent that the Company identifies that any individual customer's credit quality has deteriorated, the Company establishes allowances based on the individual risk characteristics of that customer. The Company makes concerted efforts to collect all outstanding balances due from customers; however, trade receivables and contract assets are written off against the allowance when the related balances are no longer deemed collectible. |
Concentrations of Credit Risk and Major Customers | Concentrations of Credit Risk and Major Customers Concentration of credit risk, with respect to accounts receivable, is limited due to the large number of customers and their dispersion across different geographic areas. The customers are primarily concentrated in the pharmaceutical and consumer products industries. The Company does not normally require collateral or any other security to support credit sales. The Company performs ongoing credit evaluations of its customers’ financial conditions and maintains reserves for credit losses. Such losses historically have been within the Company’s expectations. No single customer exceeded 10% of revenue during the fiscal years ended June 30, 2021, 2020, and 2019. As of June 30, 2021, the Company had one customer that represented 15% or $155 million of its net trade receivables balance. No customer exceeded 10% of trade receivables as of June 30, 2020. |
Inventories | Inventories Inventory is stated at the lower of cost or net realizable value, using the first-in, first-out ( “ FIFO ” |
Goodwill | Goodwill The Company accounts for purchased goodwill and intangible assets with indefinite lives in accordance with ASC 350, Intangibles - Goodwill and Other . Under ASC 350, goodwill and intangible assets with indefinite lives are not amortized, but instead are tested for impairment at least annually. The Company performs an impairment evaluation of goodwill annually during the fourth quarter of its fiscal year or when circumstances otherwise indicate an evaluation should be performed. The evaluation may begin with a qualitative assessment for each reporting unit to determine whether it is more-likely-than-not that the fair value of the reporting unit is less than its carrying value. Factors considered in a qualitative assessment include, among other things, macroeconomic conditions, industry and market considerations, financial performance of the respective reporting unit and other relevant entity and reporting-unit specific considerations. If the qualitative assessment does not generate a positive response, or if no qualitative assessment is performed, a quantitative assessment, based upon discounted cash flows, is performed and requires management to estimate future cash flows, growth rates, and macroeconomic, industry, and market conditions. In fiscal 2019 and 2021, the Company began its impairment evaluation with the qualitative assessment, but in fiscal 2020, the Company proceeded immediately to the quantitative assessment. Based on its qualitative assessment conducted as of April 1, 2021, the Company determined for each reporting unit with goodwill that it was more likely than not that its respective fair value exceeded its carrying value, indicating there was no impairment. For more information regarding goodwill balances at June 30, 2021, see Note 4, Goodwill . |
Property and Equipment | Property and equipment are stated at cost. Depreciation expense is computed using the straight-line method over the estimated useful lives of the assets, including leasehold improvements and finance lease right-of-use assets that are amortized over the shorter of their useful lives or the terms of the respective leases. The Company generally uses the following range of useful lives for its property and equipment categories: buildings and improvements—5 to 50 years; machinery and equipment—3 to 10 years; and furniture and fixtures—3 to 7 years. Depreciation expense was $196 million for the fiscal year ended June 30, 2021, $165 million for the fiscal year ended June 30, 2020, and $141 million for the fiscal year ended June 30, 2019. Depreciation expense includes amortization of assets related to financing leases. The Company charges repairs and maintenance costs to expense as incurred. The amount of capitalized interest for fiscal 2021 and 2020 was $17 million and $11 million, respectively, and was immaterial for fiscal 2019. |
Intangible Assets, Finite-Lived | Intangible assets with finite lives, including customer relationships, patents, and trademarks, are amortized over their useful lives. The Company also capitalizes certain computer software and development costs in other intangibles, net, when incurred in connection with developing or obtaining computer software for internal use. Capitalized software costs are amortized over the estimated useful lives of the software, which generally range from 3 to 5 years. The Company evaluates the recoverability of its other long-lived assets, including amortizing intangible assets, if circumstances indicate impairment may have occurred pursuant to ASC 360, Property, Plant and Equipment . This analysis is performed by comparing the respective carrying values of the assets to the current and expected future cash flows, on an un-discounted basis, to be generated from such assets. If such analysis indicates that the carrying value of these assets is not recoverable, the carrying value of such assets is reduced to fair value through a charge to the consolidated statements of operations. Fair value is determined based on assumptions the Company believes marketplace participants would utilize and comparable marketplace information in similar arm’s length transactions. The Company recorded impairment charges related to definite-lived intangible assets and property, |
Post-Retirement and Pension Plans | Post-Retirement and Pension Plans The Company sponsors various retirement and pension plans, including defined benefit and defined contribution retirement plans. The measurement of the related benefit obligations and the net periodic benefit costs recorded each year are based upon actuarial computations, which require management’s judgment as to certain assumptions. These assumptions include the discount rates used in computing the present value of the benefit obligations and the net periodic benefit costs, the expected future rate of salary increases (for pay-related plans) and the expected long-term rate of return on plan assets (for funded plans). The Company uses the corridor approach to amortize actuarial gains and losses. The Company has elected to utilize an approach to estimate the service and interest components of net periodic benefit cost for benefit plans that discounts the individual expected cash flows using the applicable spot rates derived from the yield curve over the projected cash flow period. The expected long-term rate of return on plan assets is based on the target asset allocation and the average expected rate of growth for the asset classes invested. The average expected rate of growth is derived from a combination of historic returns, current market indicators, and the expected risk premium for each asset class. The Company uses a measurement date of June 30 for all its retirement and postretirement benefit plans. |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest-rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its debt funding and the use of derivative financial instruments. Specifically, the Company enters into derivative financial instruments from time to time to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the values of which are determined by interest rates. The Company’s derivative financial instruments are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to the Company’s borrowings. The Company does not net any of its derivative positions under master netting arrangements. Primarily, the Company is exposed to fluctuations in the euro-U.S. dollar exchange rate on its investments in foreign operations in Europe. While the Company does not actively hedge against changes in foreign currency, it has mitigated the exposure of investments in its European operations through a net-investment hedge by denominating a portion of its debt in euros. In addition, a portion of Operating Company's interest payment obligation on its U.S dollar-denominated term loans is exposed to interest rate variability. The Company has mitigated its exposure to this risk by entering into interest-rate swap agreements, which qualify for and are designated as cash-flow hedges. Also, as discussed in Note 9, Derivative Instruments and Hedging Activities , the Company has determined that an aspect of the dividend-rate adjustment feature of the Company’s convertible Series A Preferred Stock (as defined below, see Note 13, Equity, Redeemable Preferred Stock, and Accumulated Other Comprehensive Loss |
Fair Value Measurement, Policy | Fair Value The Company is required to measure certain assets and liabilities at fair value, either upon initial measurement or for subsequent accounting or reporting. The Company uses fair value extensively, including in the initial measurement of net assets acquired in a business combination and when accounting for and reporting on certain financial instruments. The Company estimates fair value using an exit price approach, which requires, among other things, that it determine the price that would be received to sell an asset or paid to transfer a liability in an orderly market. The determination of an exit price is considered from the perspective of market participants, considering the highest and best use of assets and, for liabilities, assuming the risk of non-performance will be the same before and after the transfer. A single estimate of fair value results from a complex series of judgments about future events and uncertainties and relies heavily on estimates and assumptions. When estimating fair value, depending on the nature and complexity of the assets or liability, the Company may use one or all of the following approaches: • Market approach, which is based on market prices and other information from market transactions involving identical or comparable assets or liabilities. • Cost approach, which is based on the cost to acquire or construct comparable assets less an allowance for functional and/or economic obsolescence. • Income approach, which is based on the present value of the future stream of net cash flows. Certain investments that are measured at fair value using the net asset value ( “ NAV ” ) per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. |
Marketable Securities [Table Text Block] | Marketable Securities The Company classifies its liquid debt investments with original maturities greater than ninety days as marketable securities. The Company invests in highly rated corporate debt securities, with the primary objective of minimizing the potential risk of principal loss. The Company’s investment policy generally requires securities to be investment grade and limits the amount of credit exposure to any single issuer. The Company regularly reviews its investments and utilizes quantitative and qualitative evidence to evaluate potential impairments. For available-for-sale debt securities in an unrealized loss position, the Company assesses whether it intends to sell or if it is more likely than not that the Company will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value. If the criteria are not met, the Company evaluates whether the decline in fair value has resulted from a credit loss or other factors. In making this assessment, management considers, among other factors, the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of the cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than the amortized costs basis. The Company classifies its marketable securities as available-for-sale, because it may sell certain of its marketable securities prior to the stated maturity for various reasons, including management of liquidity, credit risk, duration, relative return, and asset allocation. The Company determines the fair value of each marketable security in its portfolio at each period end and recognizes gains and losses in the portfolio in other comprehensive income. As of June 30, 2021, the amortized cost basis of marketable securities approximates fair value and all outstanding marketable securities mature within one year. |
Self Insurance | Self-Insurance The Company is partially self-insured for certain employee health benefits and partially self-insured for property losses and casualty claims. The Company accrues for losses based upon experience and actuarial assumptions, including provisions for losses incurred but not reported. |
Accumulated Other Comprehensive Income/(Loss) | Accumulated Other Comprehensive Loss Accumulated other comprehensive loss, which is reported in the accompanying consolidated statements of changes in shareholders’ equity, consists of foreign currency translation, net change in marketable securities, and defined benefit pension plan changes. |
Research and Development Costs | Research and Development CostsThe Company expenses research and development costs as incurred. Research and development costs amounted to $21 million, $21 million, and $19 million for the fiscal years ended June 30, 2021, 2020, and 2019, respectively. |
Earnings Per Share | Earnings Per Share The Company reports net earnings per share in accordance with ASC 260, Earnings per Share . The Company computes basic earnings per share for the Common Stock using the two-class method by d ividing net income attributable to common stockholders by the weighted average number of common shares outstanding during the period. The Series A Preferred Stock, due to its convertible feature, is participating in nature; accordingly, the outstanding shares of Series A Preferred Stock are included in the two-class method. Diluted earnings per common share measures the performance of the Company over the reporting period while giving effect to all potential shares of Common Stock that were dilutive and outstanding during the period. The denominator includes the weighted average over the measurement period of the sum of the number of shares of Common Stock outstanding and the number of additional such shares that would have been outstanding if |
Income Taxes | Income Taxes In accordance with ASC 740, Income Taxes, the Company accounts for income taxes using the asset and liability method. The asset and liability method requires recognition of deferred tax assets and liabilities for expected future tax consequences of temporary differences that currently exist between tax bases and financial reporting bases of the Company’s assets and liabilities. The Company measures deferred tax assets and liabilities using enacted tax rates in the respective jurisdictions in which it operates. In assessing the ability to realize deferred tax assets, the Company considers whether it is more likely than not that the Company will be able to realize some or all of the deferred tax assets. The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax regulations in each of its tax jurisdictions. The number of years with open tax audits varies by tax jurisdiction. A number of years may lapse before a particular matter is audited and finally resolved. The Company applies ASC 740 to determine the accounting for uncertain tax positions. This standard clarifies the accounting for income taxes by prescribing a minimum recognition threshold a tax position is required to meet before the Company may recognize the position in its financial statements. The standard also provides guidance on derecognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure, and transition. The Company has elected not to reclassify the income tax effects stranded in accumulated other comprehensive income to retained earnings. |
Equity-Based Compensation | Stock-Based Compensation The Company accounts for its stock-based compensation in accordance with ASC 718, Compensation—Stock Compensation. Under ASC 718, companies recognize compensation expense using a fair-value-based method for costs related to share-based payments, including stock options and restricted stock units. The expense is measured based on the grant date fair value of the awards, and the expense is recorded over the applicable requisite service period. Forfeitures are recognized as and when they occur. In the absence of an observable market price for a share-based award, the fair value is based upon a valuation methodology that takes into consideration various factors, including the exercise price of the award, the expected term of the award, the current price of the underlying shares, the expected volatility of the underlying share price, the expected dividends on the underlying shares and the risk-free interest rate. The terms of the Company’s stock-based compensation plans permit an employee holding vested stock options or restricted stock units to elect to have the Company use a portion of the shares otherwise issuable upon the employee’s exercise of the option or grant, a so-called “ net settlement transaction, ” |
Recent Financial Accounting Standards | Recent Financial Accounting Standards Recently Adopted Accounting Standards In August 2018, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40) : Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The Company adopted the guidance on July 1, 2020. The guidance did not have a material impact on the Company’s financial condition or results of operations. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirement for Fair Value Measurement , which changes the disclosure requirements on fair value measurements in ASC 820, Fair Value Measurement . The guidance eliminates certain disclosure requirements that are no longer considered cost beneficial and adds new disclosure requirements for Level 3 fair value measurements. The Company adopted the guidance on July 1, 2020. The guidance did not have a material impact on the Company’s financial statement disclosures. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which introduces a new accounting model known as Credit Expected Credit Losses (“CECL”). CECL requires earlier recognition of credit losses on financial assets, while also providing additional transparency about credit risk. The CECL model utilizes a lifetime expected credit loss measurement objective for the recognition of credit losses for financial assets at the time they are originated or acquired. The expected credit losses are adjusted each period for changes in expected lifetime credit losses. This model replaces the multiple existing impairment models in current U.S. GAAP, which generally require that a loss be incurred before it is recognized. The new standard applies to receivables arising from revenue transactions such as contract assets, accounts receivables, available for-sale debt securities and notes receivable arising from divestitures. The Company adopted the amended guidance using a modified retrospective approach on July 1, 2020. The amended guidance did not have a material impact on the Company’s financial condition or results of operations. New Accounting Standards Not Adopted as of June 30, 2021 In March 2020, the FASB issued ASU 2020-04 , Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting , which provides optional guidance to ease the potential burden in accounting for the discontinuation of a reference rate such as LIBOR, formerly known as the London Interbank Offered Rate, because of reference rate reform. The expedients and exceptions provided by the guidance do not apply to contract modifications made and hedging relationships entered into or evaluated after December 31, 2022. The ASU is effective for all entities as of March 12, 2020 through December 31, 2022. The Company is currently evaluating the impact of adopting this guidance on its consolidated financial statements. In December 2019, the FASB issued ASU 2019-12 , Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes , which eliminates certain exceptions related to the incremental approach for intra-period allocation, deferred tax recognition requirement for changes in equity method investments and foreign subsidiaries, and methodology for calculating income taxes in an interim period. The guidance also simplifies certain aspects of the accounting for franchise taxes, the accounting for step-up in the tax basis of goodwill, and accounting for the change in the enacted change in tax laws or rates. The ASU will be effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements. In August 2018, the FASB issued ASU 2018-14, Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plan |
Revenue from Contract with Cust
Revenue from Contract with Customer (Policies) | 12 Months Ended |
Jun. 30, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer | REVENUE RECOGNITION The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers . The Company generally earns its revenue by supplying goods or providing services under contracts with its customers in three primary revenue streams: manufacturing and commercial product supply, development services, and clinical supply services. The Company measures the revenue from customers based on the consideration specified in its contracts, excluding any sales incentive or amount collected on behalf of a third party. The Company’s customer contracts generally include provisions entitling the Company to a termination penalty when the customer invokes its contractual right to terminate prior to the contract’s nominal end date. The termination penalties in the customer contracts vary but are generally considered substantive for accounting purposes and create enforceable rights and obligations throughout the stated duration of the contract. The Company accounts for a contract cancellation as a contract modification in the period in which the customer invokes the termination provision. The determination of the contract termination penalty is based on the terms stated in the relevant customer agreement. As of the modification date, the Company updates its estimate of the transaction price using the expected value method, subject to constraints, and recognizes the amount over the remaining performance period . The Company generally expenses sales commissions as incurred because either the amortization period is one year or less, or the balance with an amortization period greater than one year is not material. The following tables reflect revenue for the fiscal year ended June 30, 2021 and 2020 by type of activity and reporting segment (in millions): Fiscal Year Ended June 30, 2021 Biologics Softgel and Oral Technologies Oral and Specialty Delivery Clinical Supply Services Total Manufacturing & commercial product supply $ 533 $ 877 $ 455 $ — $ 1,865 Development services 1,395 135 231 — 1,761 Clinical supply services — — — 391 391 Total $ 1,928 $ 1,012 $ 686 $ 391 $ 4,017 Inter-segment revenue elimination (19) Combined net revenue $ 3,998 Fiscal Year Ended June 30, 2020 Biologics Softgel and Oral Technologies Oral and Specialty Delivery Clinical Supply Services Total Manufacturing & commercial product supply $ 332 $ 955 $ 450 $ — $ 1,737 Development services 689 107 226 — 1,022 Clinical supply services — — — 345 345 Total $ 1,021 $ 1,062 $ 676 $ 345 $ 3,104 Inter-segment revenue elimination (10) Combined net revenue $ 3,094 The following table reflects revenue by the location where the goods were made or the service performed: (Dollars in millions) Fiscal Year Ended Fiscal Year Ended United States $ 2,462 $ 1,822 Europe 1,343 976 Other 288 376 Elimination of revenue attributable to multiple locations (95) (80) Total $ 3,998 $ 3,094 Manufacturing & Commercial Product Supply Revenue Manufacturing and commercial product supply revenue consists of revenue earned by manufacturing products supplied to customers under long-term commercial supply arrangements. In these arrangements, the customer typically owns and supplies the active pharmaceutical ingredient, or API, that is used in the manufacturing process. The contract generally includes the terms of the manufacturing services and related product quality assurance procedures to comply with regulatory requirements. Due to the regulated nature of the Company’s business, these contract terms are highly interdependent and, therefore, are considered to be a single combined performance obligation. The transaction price is generally stated in the agreement as a fixed price per unit, with no contractual provision for a refund or price concession. Control is transferred to the customer over time, creating a corresponding right to recognize the related revenue, because there is no alternative use to the Company for the asset created and the Company has an enforceable right to payment for performance completed as of that date. Progress is measured based on the units of product that have successfully completed the contractually required product quality assurance process, as the conclusion of that process generally defines the time when the applicable contract and the related regulatory requirements permit the customer to exercise control over the product’s disposition. The customer is typically responsible for arranging the shipping and handling of product following completion of the quality assurance process. Payment is typically due 30 to 90 days after the goods are shipped as requested by the customer, based on the payment terms set forth in the applicable customer agreement. Development Services Revenue Development services contracts generally take the form of short-term, fee-for-service arrangements. Performance obligations vary, but frequently include biologic cell-line development, performing formulation, analytical stability, or other services related to product development, and providing manufacturing services for products that are under development or otherwise not intended for commercial sale. The transaction prices for these arrangements are fixed and include amounts stated in the contracts for each promised service, and each service is generally considered to be a separate performance obligation. The Company recognizes revenue over time because there is no alternative use to the Company for the asset created and the Company has an enforceable right to payment for performance completed as of that date. The Company measures progress toward the completion of its performance obligations satisfied over time based on the nature of the services to be performed. For certain types of arrangements, revenue is recognized over time and measured using an output method based on the completion of tasks and activities that are performed to satisfy a performance obligation. For all other types of arrangements, revenue is recognized over time and measured using an input method based on effort expended. Each of these methods provides an appropriate depiction of the Company’s progress toward fulfilling its performance obligations for its respective arrangement. In certain development services arrangements that require a portion of the contract consideration to be received in advance at the commencement of the contract, such advance payment is initially recorded as a contract liability. The Company allocates consideration to each performance obligation using the “relative standalone selling price” as defined under ASC 606. Generally, the Company utilizes observable standalone selling prices in its allocations of consideration. If observable standalone selling prices are not available, the Company estimates the applicable standalone selling price using an adjusted market assessment approach, representing the amount that the Company believes the market is willing to pay for the applicable service. Payment is typically due 30 to 90 days following the completion of services provided to the customer, based on the payment terms set forth in the applicable customer agreemen t . Clinical Supply Services Revenue Clinical supply services contracts generally take the form of fee-for-service arrangements. Performance obligations for clinical supply services revenue typically include a combination of the following services: the manufacturing, packaging, storage, distribution, destruction, and inventory management of customer clinical trial material. Performance obligations can also include the sourcing of comparator drug products on behalf of customers to be used in clinical trials to compare performance with the drug under clinical investigation. In certain arrangements, the Company recognizes revenue over time when the Company satisfies performance obligations. Satisfaction of the performance obligations is measured using an input method measure of progress based on effort expended by the Company. In other arrangements, revenue is recognized at the point in time when control transfers, which occurs upon either the delivery of the related output of the service to the customer or the completion of quality testing with respect to the product, and the Company has an enforceable right to payment based on the terms of the arrangement. Payment is typically due 30 to 90 days following the completion of services provided to the customer, based on the payment terms set forth in the applicable customer agreement. The Company records revenue for comparator sourcing arrangements on a net basis because it is acting as an agent that does not control the product or service before it is transferred to the customer. Payment for comparator sourcing activity is typically received in advance at the commencement of the contract and is initially recorded as a contract liability. Licensing Revenue The Company occasionally enters into arrangements with its customers that include licenses of functional intellectual property, including patents, or other intangible property (“out-licensing”). Revenue from such arrangements are within the scope of ASC 606. The Company does not have any material license arrangement that contains more than one performance obligation. The terms of such out-licensing arrangements include the license of functional intellectual or intangible property (primarily drug formulae) and typically provide for payment by the licensee of one or more of the following: non-refundable, up-front license fees or royalties on net sales of licensed products. The Company recognizes revenue from nonrefundable, up-front license fees when the licensed intellectual property is made available for the customer’s use and benefit, which is generally at the inception of the arrangement. Royalty payments from such arrangements are recognized when subsequent sale or usage of an item subject to the royalty occurs and the performance obligation to which royalty relates is satisfied . Contract Liabilities Contract liabilities relate to cash consideration that the Company receives in advance of satisfying the related performance obligations. The contract liabilities balances (current and non-current) as of June 30, 2021 and June 30, 2020 were as follows: (Dollars in millions) Balance at June 30, 2020 $ 218 Balance at June 30, 2021 $ 321 Revenue recognized in the period from amounts included in contracts liability at the beginning of the period: $ 196 Contract liabilities that will be recognized within 12 months of June 30, 2021 are accounted for in Other accrued liabilities and those that will be recognized longer than 12 months after June 30, 2021 are accounted for within Other liabilities. Contract Assets Contract assets primarily relate to the Company's conditional right to receive consideration for services that have been performed for the customer as of June 30, 2021 relating to its development services but had not yet been invoiced as of June 30, 2021. Contract assets are transferred to trade receivables, net when the Company’s right to receive the consideration becomes unconditional. Contract assets totaled $181 million and $61 million as of June 30, 2021 and 2020, respectively. Contract assets are accounted for within prepaid expenses and other in the consolidated balance sheets. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Disaggregation of Revenue [Line Items] | |
Disaggregation of Revenue | The following tables reflect revenue for the fiscal year ended June 30, 2021 and 2020 by type of activity and reporting segment (in millions): Fiscal Year Ended June 30, 2021 Biologics Softgel and Oral Technologies Oral and Specialty Delivery Clinical Supply Services Total Manufacturing & commercial product supply $ 533 $ 877 $ 455 $ — $ 1,865 Development services 1,395 135 231 — 1,761 Clinical supply services — — — 391 391 Total $ 1,928 $ 1,012 $ 686 $ 391 $ 4,017 Inter-segment revenue elimination (19) Combined net revenue $ 3,998 Fiscal Year Ended June 30, 2020 Biologics Softgel and Oral Technologies Oral and Specialty Delivery Clinical Supply Services Total Manufacturing & commercial product supply $ 332 $ 955 $ 450 $ — $ 1,737 Development services 689 107 226 — 1,022 Clinical supply services — — — 345 345 Total $ 1,021 $ 1,062 $ 676 $ 345 $ 3,104 Inter-segment revenue elimination (10) Combined net revenue $ 3,094 |
Revenue Recognition and Deferred Revenue [Abstract] | |
Contractual Liabilities | The contract liabilities balances (current and non-current) as of June 30, 2021 and June 30, 2020 were as follows: (Dollars in millions) Balance at June 30, 2020 $ 218 Balance at June 30, 2021 $ 321 Revenue recognized in the period from amounts included in contracts liability at the beginning of the period: $ 196 |
geographical [Member] | |
Disaggregation of Revenue [Line Items] | |
Disaggregation of Revenue | The following table reflects revenue by the location where the goods were made or the service performed: (Dollars in millions) Fiscal Year Ended Fiscal Year Ended United States $ 2,462 $ 1,822 Europe 1,343 976 Other 288 376 Elimination of revenue attributable to multiple locations (95) (80) Total $ 3,998 $ 3,094 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Business Acquisition [Line Items] | |
Disposal Groups, Including Discontinued Operations | The Company valued the total consideration received from divestiture of the Blow-Fill-Seal Business as follows: (Dollars in millions) Fair value of consideration received Cash, gross $ 300 Note receivable (1) 47 Contingent consideration (2) — Other (3) (16) Total $ 331 (1) The note receivable, which provides for interest at a rate of 5.0% paid in kind, had an estimated fair value of $47 million at June 30, 2021, which is the $50 million aggregate principal amount less a $3 million discount determined using a discounted cash flow model with the market interest rate as a significant input. (2) The Company determined that the estimated fair value of the contingent consideration from the sale of the Blow-Fill-Seal Business at June 30, 2021 was zero, and therefore no contingent consideration was recorded at divestiture. If any contingent consideration is subsequently received, it will be recorded in the period in which it is received. The Company has elected an accounting policy to recognize increases in the carrying amount of the contingent consideration asset using the gain contingency guidance in ASC 450, Contingencies . (3) Other includes $8 million of transaction expenses, a working capital adjustment of $6 million , and $2 million assumption of liabilities resulting in net cash proceed of $287 million for the fiscal year ended June 30, 2021, with an additional $3 million accrued at June 30, 2021 as a post-closing purchase price adjustment. The final post-closing purchase price adjustment was paid by the Company in August 2021. |
MaSTherCell [Member] | |
Business Acquisition [Line Items] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | The purchase price allocation to assets acquired and liabilities assumed in the transaction is (in millions): Property, plant, and equipment $ 26 Identifiable intangible assets 51 Other net assets 1 Deferred income tax liabilities (8) Total identifiable net assets $ 70 Goodwill 253 Total assets acquired and liabilities assumed $ 323 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Carrying Amount of Goodwill | The following table summarizes the changes from June 30, 2019 to June 30, 2020 and then to June 30, 2021 in the carrying amount of goodwill in total and by reporting segment: (Dollars in millions) Biologics Softgel and Oral Technologies Oral and Specialty Delivery Clinical Supply Services Total Balance at June 30, 2019 $ 1,320 $ 409 $ 340 $ 152 $ 2,221 Additions (1) 264 — — — 264 Reallocation (2) (124) 108 16 — — Other 3 (2) 2 — 3 Foreign currency translation adjustments — (10) (3) (4) (17) Balance at June 30, 2020 1,463 505 355 148 2,471 Additions (3) 54 — 2 — 56 Divestitures (4) — — (54) — (54) Foreign currency translation adjustments 14 11 13 8 46 Balance at June 30, 2021 $ 1,531 $ 516 $ 316 $ 156 $ 2,519 (1) The increase in fiscal 2020 primarily relates to the MaSTherCell acquisition. See Note 3, Business Combinations and Divestitures . (2) The reallocation in fiscal 2020 relates to adjustments to the Company’s reporting segments, as a result of which certain assets moved from the Biologics segment to the Oral and Specialty Delivery segment, and other assets moved from the Oral and Specialty Delivery segment to the Softgel and Oral Technologies segment. (3) The addition in the Biologics segment relates to the Skeletal and Delphi acquisitions. The addition in the Oral and Specialty Delivery segment relates to the Acorda transaction. For further details, see Note 3, Business Combinations and Divestitures . |
Definite Lived Long-Lived Ass_2
Definite Lived Long-Lived Assets (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Finite lived intangible assets disclosure [Abstract] | |
Other Intangible Assets Subject to Amortization | The details of other intangible assets subject to amortization as of June 30, 2021 and June 30, 2020 are as follows (in millions): June 30, 2021 Weighted Average Life Gross Carrying Value Accumulated Amortization Net Carrying Value Amortized intangibles: Core technology 19 years $ 140 $ (94) $ 46 Customer relationships 14 years 1,024 (306) 718 Product relationships 11 years 281 (237) 44 Other 5 years 17 (8) 9 Total other intangibles $ 1,462 $ (645) $ 817 June 30, 2020 Weighted Average Life Gross Carrying Value Accumulated Amortization Net Carrying Value Amortized intangibles: Core technology 19 years $ 135 $ (83) $ 52 Customer relationships 14 years 1,021 (248) 773 Product relationships 11 years 270 (217) 53 Other 5 years 16 (5) 11 Total other intangibles $ 1,442 $ (553) $ 889 |
Future Amortization Expense | Future amortization expense for the next five fiscal years is estimated to be: (Dollars in millions) 2022 2023 2024 2025 2026 Amortization expense $ 93 $ 92 $ 91 $ 90 $ 83 |
Restructuring and Other Costs (
Restructuring and Other Costs (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring and Other Costs | The following table summarizes the costs recorded within restructuring costs: Fiscal Year Ended June 30, (Dollars in millions) 2021 2020 2019 Restructuring costs: Employee-related reorganization $ 8 $ 6 $ 14 Facility exit and other costs 2 — — Total restructuring costs $ 10 $ 6 $ 14 |
Long-Term Obligations and Oth_2
Long-Term Obligations and Other Short-Term Borrowings (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments [Table Text Block] | Long-term obligations and short-term borrowings consist of the following at June 30, 2021 and June 30, 2020: (Dollars in millions) Maturity as of June 30, 2021 June 30, 2021 June 30, 2020 Senior secured credit facilities Term loan facility B-2 May 2026 $ — $ 938 Term loan facility B-3 February 2028 997 — Revolving credit facility May 2024 — — 4.875% senior notes due 2026 January 2026 — 450 5.000% senior notes due 2027 July 2027 500 500 2.375% Euro-denominated senior notes due 2028 (1) March 2028 984 926 3.125% senior notes due 2029 February 2029 550 — Deferred purchase consideration October 2021 50 98 Financing lease obligations 2021 to 2038 193 142 Other obligations 2021 to 2028 3 1 Debt issuance costs (36) (37) Total debt 3,241 3,018 Less: current portion of long-term obligations and other short-term 75 73 Long-term obligations, less current portion $ 3,166 $ 2,945 (1) The increase in euro-denominated debt at June 30, 2021 compared to the prior year is primarily due to fluctuations in foreign currency exchange rates. |
Maturities of long-term obligations | Maturities of long-term obligations, including finance leases of $193 million, and other short-term borrowings for future fiscal years are: (Dollars in millions) 2022 2023 2024 2025 2026 Thereafter Total Maturities of long-term and other obligations $ 75 $ 23 $ 24 $ 22 $ 20 $ 3,113 $ 3,277 |
Fair Value Disclosures [Abstract] | |
Schedule Of Carrying And Fair Value Of Financial Instruments Table | The carrying amounts and the estimated fair values of financial instruments as of June 30, 2021 and June 30, 2020 are as follows: June 30, 2021 June 30, 2020 (Dollars in millions) Fair Value Measurement Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value 4.875% Senior Notes due 2026 Level 2 $ — $ — $ 450 $ 464 5.000% Senior Notes due 2027 Level 2 500 539 500 538 2.375% Euro-denominated Senior Notes due 2028 Level 2 984 993 926 844 3.125% Senior Notes due 2029 Level 2 550 524 — — Senior secured credit facilities & other Level 2 1,243 1,209 1,179 1,160 Subtotal $ 3,277 $ 3,265 $ 3,055 $ 3,006 Debt issuance costs (36) — (37) — Total debt $ 3,241 $ 3,265 $ 3,018 $ 3,006 |
Earnings Per Share Calculation
Earnings Per Share Calculation (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The reconciliations between basic and diluted earnings per share attributable to Catalent common shareholders for the fiscal years ended June 30, 2021, 2020, and 2019 are as follows: Fiscal year ended June 30, (In millions, except per share data) 2021 2020 2019 Net earnings $ 585 $ 221 $ 137 Less: Net earnings attributable to preferred shareholders (56) (48) (5) Net earnings attributable to common shareholders $ 529 $ 173 $ 132 Weighted average shares outstanding - basic 168 150 144 Weighted average dilutive securities issuable - stock plans 2 2 2 Total weighted average shares outstanding - diluted 170 152 146 Earnings per share: Basic $ 3.15 $ 1.16 $ 0.92 Diluted $ 3.11 $ 1.14 $ 0.90 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The diluted weighted average number of shares outstanding for the fiscal years ended June 30, 2021, 2020 and 2019 did not include the weighted average number of shares of Common Stock associated with the Series A Preferred Stock reported below or the weighted average number of shares of Common Stock associated with the following types of outstanding equity grants due to their antidilutive effect: Fiscal year ended June 30, (share counts in millions) 2021 2020 2019 Stock options — — 2 Time-based restricted stock units — — 1 Performance-based restricted stock units — — 1 Series A Preferred Stock 10 13 2 |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Net Investment Hedge in Accumulated Other Comprehensive Income (Loss) and Statement of Financial Performance [Table Text Block] | The following table includes net investment hedge activity during the fiscal years ended June 30, 2021 and 2020, respectively: (Dollars in millions) June 30, 2021 June 30, 2020 Unrealized foreign exchange gain (loss) within Other Comprehensive Income $ (56) $ 3 Unrealized foreign exchange gain (loss) within the Consolidated Statements of Operations $ (3) $ 6 |
Schedule of Interest Rate Derivatives | A summary of the estimated fair value of the interest-rate swap reported in the consolidated balance sheets is stated in the table below: June 30, 2021 June 30, 2020 (in millions) Balance Sheet Classification Estimated Fair Value Balance Sheet Classification Estimated Fair Value Interest-rate swap Other long-term assets $ 2 Other liabilities $ 4 |
Fair Value Measures and Discl_2
Fair Value Measures and Disclosures (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table sets forth the Company’s financial assets and liabilities that were measured at fair value on a recurring basis and the fair value measurement for such assets and liabilities at June 30, 2021 and June 30, 2020, respectively: (Dollars in millions) Basis of Fair Value Measurement June 30, 2021 Total Level 1 Level 2 Level 3 Assets: Marketable securities $ 71 $ 71 $ — $ — Interest-rate swap 2 — 2 — Trading securities $ 1 $ 1 $ — $ — Liabilities: Series A Preferred Stock derivative liability $ 3 $ — $ — $ 3 June 30, 2020 Assets: Trading securities $ 1 $ 1 $ — $ — Liabilities: Series A Preferred Stock derivative liability $ 24 $ — $ — $ 24 Interest-rate swap $ 4 $ — $ 4 $ — |
Schedule of Derivative Liabilities at Fair Value [Table Text Block] | The following table sets forth a summary of changes in the estimated fair value of the Series A Preferred Stock derivative liability from June 30, 2020 to June 30, 2021: ( Dollars in millions) Fair Value Measurement of Balance at June 30, 2020 $ 24 Change in estimated fair value of Series A Preferred Stock derivative liability (17) Settlement of derivative liability upon Partial Conversion (4) Balance at June 30, 2021 $ 3 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | |
Earnings/(loss) from continuing operations before income taxes and discontinued operations | Earnings before income taxes are as follows for fiscal 2021, 2020, and 2019: Fiscal Year Ended (Dollars in millions) 2021 2020 2019 U.S. operations $ 457 $ 121 $ 36 Non-U.S. operations 258 139 124 Total $ 715 $ 260 $ 160 |
Provision/ (benefit) for income taxes | The provision for income taxes consists of the following for fiscal 2021, 2020, and 2019: Fiscal Year Ended (Dollars in millions) 2021 2020 2019 Current: Federal $ 8 $ 1 $ 2 State and local 20 1 1 Non-U.S. 38 33 26 Total current expense $ 66 $ 35 $ 29 Deferred: Federal $ 62 $ 11 $ 4 State and local 7 6 (12) Non-U.S. (5) (13) 2 Total deferred expense (benefit) $ 64 $ 4 $ (6) Total provision $ 130 $ 39 $ 23 |
Reconciliation of the provision/(benefit) based on the federal statutory income tax rate | A reconciliation of the provision starting from the tax computed at the federal statutory income tax rate to the tax computed at the Company’s effective income tax rate is as follows for the fiscal years ended 2021, 2020, and 2019: Fiscal Year Ended (Dollars in millions) 2021 2020 2019 Provision at U.S. federal statutory tax rate $ 150 $ 55 $ 34 State and local income taxes 26 6 (1) Foreign tax rate differential (14) (6) (3) Global intangible low tax income 3 3 3 Other permanent items (5) 2 5 Unrecognized tax positions 3 (1) 1 Tax valuation allowance (7) (21) (11) Foreign tax credit (24) (3) (4) Withholding tax and other foreign taxes 1 1 1 Change in tax rate 2 4 1 R&D tax credit (5) (2) (2) Other — 1 (1) Total provision $ 130 $ 39 $ 23 |
Components of the deferred income tax assets and liabilities | Deferred income taxes arise from temporary differences between the financial reporting and tax reporting bases of assets and liabilities, and operating loss and tax credit carryforwards for tax purposes. The components of the Company's deferred income tax assets and liabilities are as follows at June 30, 2021 and 2020: Fiscal Year Ended (Dollars in millions) 2021 2020 Deferred income tax assets: Accrued liabilities $ 43 $ 30 Equity compensation 15 16 Loss and tax credit carryforwards 187 194 Foreign currency 12 15 Pension 24 28 Interest-related 14 9 Deferred revenue 3 — Lease liabilities 35 34 Euro-denominated debt 23 7 Total deferred income tax assets $ 356 $ 333 Valuation allowance (65) (53) Net deferred income tax assets $ 291 $ 280 Fiscal Year Ended (Dollars in millions) 2021 2020 Deferred income tax liabilities: Deferred revenue $ — $ (8) Property-related (171) (100) Goodwill and other intangibles (194) (192) Right-of-use assets (18) (22) Other (6) (3) Total deferred income tax liabilities $ (389) $ (325) Net deferred tax liability $ (98) $ (45) |
Deferred tax assets and liabilities | Deferred tax assets and liabilities in the preceding table are in the following captions in the consolidated balance sheets at June 30, 2021 and 2020: Fiscal Year Ended (Dollars in millions) 2021 2020 Non-current deferred tax asset $ 66 $ 49 Non-current deferred tax liability 164 94 Net deferred tax liability $ (98) $ (45) |
Reconciliation of Unrecognized tax benefit, excluding accrued interest | A reconciliation of unrecognized tax benefits, excluding accrued interest, as of June 30, 2021, 2020, and 2019 is as follows: (Dollars in millions) Balance at June 30, 2018 $ 2 Additions for tax positions of prior years 3 Lapse of the applicable statute of limitations (1) Balance at June 30, 2019 $ 4 Additions for tax positions of prior years 1 Lapse of the applicable statute of limitations (1) Balance at June 30, 2020 $ 4 Additions based on tax positions related to the current year 2 Additions for tax positions of prior years 1 Settlements (2) Balance at June 30, 2021 $ 5 |
Employee Retirement Benefit P_2
Employee Retirement Benefit Plans (Tables) | 12 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Retirement Benefits [Abstract] | ||
Benefit obligation and fair value of plan assets for the defined benefit retirement and postretirement plan | The following table provides a reconciliation of the change in projected benefit obligation and fair value of plan assets for the defined benefit retirement and other retirement plans, excluding the multi-employer pension plan liability: Retirement Benefits Other Post-Retirement Benefits June 30, June 30, (Dollars in millions) 2021 2020 2021 2020 Accumulated Benefit Obligation $ 364 $ 351 $ 2 $ 3 Change in Benefit Obligation Benefit obligation at beginning of year 358 350 3 3 Company service cost 4 4 — — Interest cost 4 5 — — Curtailments — (1) — — Settlements — (4) — — Benefits paid (13) (11) (1) — Actuarial (gain) loss (9) 21 — — Exchange rate gain (loss) 28 (6) — — Benefit obligation at end of year $ 372 $ 358 $ 2 $ 3 Change in Plan Assets Fair value of plan assets at beginning of year 295 272 — — Actual return on plan assets (1) 31 — — Company contributions 11 12 — — Settlements — (4) — — Benefits paid (13) (11) — — Exchange rate gain (loss) 26 (5) — — Fair value of plan assets at end of year $ 318 $ 295 $ — $ — Funded Status Funded status at end of year (54) (63) (2) (3) Net pension liability $ (54) $ (63) $ (2) $ (3) | |
Reconciliation of the net amount recognized in the Consolidated Balance Sheets | The following table provides a reconciliation of the net amount recognized in the consolidated balance sheets: Retirement Benefits Other Post-Retirement Benefits June 30, June 30, (Dollars in millions) 2021 2020 2021 2020 Amounts Recognized in Statement of Financial Position Noncurrent assets $ 43 $ 32 $ — $ — Current liabilities (1) (1) — — Noncurrent liabilities (96) (94) (2) (3) Total liability (54) (63) (2) (3) Amounts Recognized in Accumulated Other Comprehensive Loss Prior service cost (1) (1) — — Net loss (gain) 62 62 (1) (1) Total accumulated other comprehensive loss (income) at the end of the fiscal year 61 61 (1) (1) Additional Information for Plan with ABO or PBO in Excess of Plan Assets Projected benefit obligation 130 165 2 3 Accumulated benefit obligation 124 159 2 3 Fair value of plan assets 32 70 — — Components of Net Periodic Benefit Cost Service cost 4 4 — — Interest cost 4 5 — — Expected return on plan assets (11) (11) — — Amortization of unrecognized: Net loss 3 5 — — Net periodic benefit cost $ — $ 3 $ — $ — Retirement Benefits Other Post-Retirement Benefits June 30, June 30, (Dollars in millions) 2021 2020 2021 2020 Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income Net (gain) loss arising during the year $ 3 $ 1 $ — $ — Net gain (loss) recognized during the year (3) (5) — — Total recognized in other comprehensive income $ — $ (4) $ — $ — Total Recognized in Net Periodic Benefit Cost and Other Comprehensive Income Total recognized in net periodic benefit cost and other comprehensive income $ — $ (1) $ — $ — Estimated Amounts to be Amortized from Accumulated Other Comprehensive Income into Net Periodic Benefit Cost Amortization of: Net loss $ 3 $ 3 $ — $ — Financial Assumptions Used to Determine Benefit Obligations at the Balance Sheet Date Discount rate (%) 1.6 % 1.4 % 2.0 % 1.8 % Rate of compensation increases (%) 2.0 % 1.6 % n/a n/a Financial Assumptions Used to Determine Net Periodic Benefit Cost for Financial Year Discount rate (%) 1.4 % 1.9 % 1.8 % 3.0 % Rate of compensation increases (%) 2.0 % 2.0 % n/a n/a Expected long-term rate of return (%) 3.6 % 4.3 % n/a n/a Expected Future Contributions Fiscal year 2022 $ 8 $ 10 $ — $ — Retirement Benefits Other Post-Retirement Benefits June 30, June 30, (Dollars in millions) 2021 2020 2021 2020 Expected Future Benefit Payments Financial year 2022 $ 13 $ 12 $ — $ — 2023 14 12 — — 2024 15 13 — — 2025 15 14 — — 2026 15 14 — — 2027-2031 $ 84 $ 75 $ 1 $ 1 Actual Asset Allocation (%) Equities 4.4 % 9.7 % — % — % Government bonds 30.6 % 26.8 % — % — % Corporate bonds 21.0 % 24.8 % — % — % Property 3.5 % 3.1 % — % — % Insurance contracts 9.6 % 9.5 % — % — % Other 30.9 % 26.1 % — % — % Total 100.0 % 100.0 % — % — % Actual Asset Allocation (Amount) Equities $ 14 $ 29 $ — $ — Government bonds 97 79 — — Corporate bonds 67 73 — — Property 11 9 — — Insurance contracts 31 28 — — Other 98 77 — — Total $ 318 $ 295 $ — $ — Target Asset Allocation (%) Equities 4.5 % 10.1 % — % — % Government bonds 30.5 % 27.1 % — % — % Corporate bonds 21.1 % 24.5 % — % — % Property 3.5 % 3.1 % — % — % Insurance contracts 9.6 % 9.5 % — % — % Other 30.8 % 25.7 % — % — % Total 100.0 % 100.0 % — % — % | |
Summary of plan assets that are measured in fair value | The following tables provide a summary of plan assets that are measured at fair value as of June 30, 2021 and 2020, aggregated by the level in the fair value hierarchy within which those measurements fall: As of June 30, 2021 (dollars in millions) Level 1 Level 2 Level 3 Investments Measured at Net Asset Value Total Assets Equity securities $ — $ 14 $ — $ — $ 14 Debt securities — 164 — — 164 Real estate — 11 — — 11 Other (1) — 106 23 — 129 Total $ — $ 295 $ 23 $ — $ 318 (1) Other as of June 30, 2021, included $62 million of investments in hedge funds related to the Company's U.K. pension plan, which were classified as Level 2. | As of June 30, 2020 (dollars in millions) Level 1 Level 2 Level 3 Investments Measured at Net Asset Value Total Assets Equity securities $ — $ 29 $ — $ — $ 29 Debt securities — 152 — — 152 Real estate — 7 — 2 9 Other (1) — 84 21 — 105 Total $ — $ 272 $ 21 $ 2 $ 295 |
Reconciliation of beginning and ending balances of level 3 assets | The following table provides a reconciliation of the beginning and ending balances of Level 3 assets as well as the changes during the period attributable to assets held and those purchases, sales, settlements, contributions, and benefits that were paid: Fair Value Measurement Using Significant Unobservable Inputs Total (Level 3) Fair Value Measurement Using Significant Unobservable Inputs Insurance Contracts Fair Value Measurement Using Significant Unobservable Inputs Other Total (Level 3) (Dollars in millions) Beginning Balance at June 30, 2020 $ 21 $ 3 $ 18 Actual return on plan assets: Relating to assets still held at the reporting date 3 — 3 Purchases, sales, settlements, contributions and benefits paid (2) — (2) Transfers in or out of Level 3, net 1 — 1 Ending Balance at June 30, 2021 $ 23 $ 3 $ 20 | |
Assumed healthcare cost trend rates | Other Post-Retirement Benefits Assumed Healthcare Cost Trend Rates at the Balance Sheet Date 2021 2020 Healthcare cost trend rate – initial (%) Pre-65 n/a n/a Post-65 7.3 % (1.1) % Healthcare cost trend rate – ultimate (%) Pre-65 n/a n/a Post-65 4.4 % 4.9 % Year in which ultimate rates are reached Pre-65 n/a n/a Post-65 2035 2032 |
Equity and Accumulated Other _2
Equity and Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Equity [Abstract] | |
Accumulated other comprehensive earnings/(loss) | Accumulated other comprehensive loss by component and changes for the fiscal years ended June 30, 2021, 2020, and 2019 consist of: (Dollars in millions) Foreign Currency Translation Adjustment Pension Liability Adjustments Derivatives and Hedges Marketable Securities Other Total Balance at June 30, 2018 $ (285) $ (40) $ — $ — $ (1) $ (326) Other comprehensive loss before reclassifications (19) — — — — (19) Amounts reclassified from Other Comprehensive Loss — (9) — — — (9) Balance at June 30, 2019 (304) (49) — — (1) (354) Other comprehensive loss before reclassifications (31) — (3) — — (34) Amounts reclassified from Other Comprehensive Loss — 2 — — — 2 Balance at June 30, 2020 (335) (47) (3) — (1) (386) Other comprehensive income (loss) before reclassifications 67 — 3 (1) — 69 Balance at June 30, 2021 $ (268) $ (47) $ — $ (1) $ (1) $ (317) |
Schedule of Comprehensive Income (Loss) | The components of the changes in the cumulative translation adjustment, derivatives and hedges, minimum pension liability, and marketable securities for the fiscal years ended June 30, 2021, 2020, and 2019 consists of: Fiscal Year Ended June 30, (Dollars in millions) 2021 2020 2019 Foreign currency translation adjustments: Net investment hedge $ (56) $ 3 $ 12 Long-term inter-company loans 39 (9) (13) Translation adjustments 72 (25) (16) Total foreign currency translation adjustments, pretax 55 (31) (17) Tax expense (benefit) (12) — 2 Total foreign currency translation adjustments, net of tax $ 67 $ (31) $ (19) Net change in derivatives and hedges: Net gain (loss) recognized during the year, pretax $ 4 $ (4) $ — Tax expense (benefit) 1 (1) — Net change in derivatives and hedges, net of tax $ 3 $ (3) $ — Net change in minimum pension liability: Net gain (loss) recognized during the year, pretax $ — $ 4 $ (13) Tax expense (benefit) — 2 (4) Net change in minimum pension liability, net of tax $ — $ 2 $ (9) Net change in marketable securities: Net loss recognized during the year, pretax $ (1) $ — $ — Tax expense (benefit) — — — Net change in marketable securities, net of tax $ (1) $ — $ — Accumulated Other Comprehensive Loss Accumulated other comprehensive loss by component and changes for the fiscal years ended June 30, 2021, 2020, and 2019 consist of: (Dollars in millions) Foreign Currency Translation Adjustment Pension Liability Adjustments Derivatives and Hedges Marketable Securities Other Total Balance at June 30, 2018 $ (285) $ (40) $ — $ — $ (1) $ (326) Other comprehensive loss before reclassifications (19) — — — — (19) Amounts reclassified from Other Comprehensive Loss — (9) — — — (9) Balance at June 30, 2019 (304) (49) — — (1) (354) Other comprehensive loss before reclassifications (31) — (3) — — (34) Amounts reclassified from Other Comprehensive Loss — 2 — — — 2 Balance at June 30, 2020 (335) (47) (3) — (1) (386) Other comprehensive income (loss) before reclassifications 67 — 3 (1) — 69 Balance at June 30, 2021 $ (268) $ (47) $ — $ (1) $ (1) $ (317) |
Equity Based Compensation (Tabl
Equity Based Compensation (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract] | The weighted average of assumptions used in estimating the fair value of stock options granted during each year were as follows: Fiscal Year Ended June 30, 2021 2020 2019 Expected volatility 27% 23 % - 24% 22 % - 24% Expected life (in years) 6.25 6.25 6.25 Risk-free interest rate 0.3% 1.7 % - 1.9% 2.2 % - 2.8% Dividend yield None None None |
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award [Table Text Block] | The following table summarizes stock option activity and shares subject to outstanding options for the fiscal year ended June 30, 2021 : Time Performance Weighted Average Exercise Price Number of Shares Weighted Average Contractual Term Aggregate Intrinsic Value Number of Shares Weighted Average Contractual Term Aggregate Intrinsic Value Outstanding as of June 30, 2020 $ 35.53 1,997,888 8.63 $ 76,229,381 85,482 5.01 $ 2,453,938 Granted 88.10 231,352 — — — — — Exercised 26.25 870,210 — 63,527,893 2,492 — 222,251 Forfeited 48.83 73,855 — — 82,990 — — Expired / Canceled 41.16 5,001 — — — — — Outstanding as of June 30, 2021 49.77 1,280,174 4.92 74,696,700 — 0.00 — Vest and expected to vest as of June 30, 2021 49.77 1,280,174 4.92 74,696,700 — 0.00 — Vested and exercisable as of June 30, 2021 $ 38.14 480,235 6.69 $ 33,607,419 — 0.00 $ — |
Schedule of Nonvested Restricted Stock Units Activity [Table Text Block] | The following table summarizes activity in unvested time-based restricted stock units and restricted stock for the fiscal year ended June 30, 2021: Time-Based Units and Shares Weighted Average Grant-Date Fair Value Unvested as of June 30, 2020 1,081,648 $ 47.45 Granted 283,495 93.58 Vested 492,274 43.62 Cancelled/forfeited/adjusted 108,513 57.85 Unvested as of June 30, 2021 764,356 65.54 |
Schedule of Nonvested Performance-based Units Activity [Table Text Block] | Adjusted EPS and RTSR-Based Performance Share Units and Performance Shares The following table summarizes activity in unvested performance share units and performance shares for the fiscal year ended June 30, 2021: Performance-Based Units and Shares Weighted Average Grant-Date Fair Value Target Number Unvested as of June 30, 2020 516,416 $ 43.37 Target Number Granted 113,376 88.57 Target Number Vested 259,730 36.27 Target Number Cancelled/forfeited/adjusted (22,033) 47.47 Target Number Unvested as of June 30, 2021 392,095 $ 58.16 |
Fair Value Measurements, Nonrecurring | Valuation of RTSR Performance Shares and Performance Share Units The fair value of each RTSR performance share unit and performance share is determined using the Monte Carlo pricing model because the number of shares to be awarded is subject to a market condition. The Monte Carlo simulation is a generally accepted statistical technique used to simulate a range of possible future outcomes. Because the valuation model considers a range of possible outcomes, compensation cost is recognized regardless of whether the market condition is actually satisfied. The assumptions used in estimating the fair value of the RTSR performance share units and performance shares granted during each year were as follows: Fiscal Year Ended June 30, 2021 2020 Expected volatility 39 % - 42% 30 % - 31% Expected life (in years) 2.4 - 2.9 2.4 - 2.9 Risk-free interest rates 0.1 % - 0.2% 1.5 % - 1.8% Dividend yield None None |
Nonvested Restricted Stock Shares Activity | The following table summarizes activity in unvested RTSR performance share units and performance shares for the fiscal year ended June 30, 2021: RTSR Units and Shares Weighted Average Grant-Date Fair Value Target Number Unvested as of June 30, 2020 427,903 $ 49.02 Target Number Granted 105,449 101.42 Target Number Vested 202,805 38.63 Target Number Cancelled/forfeited/adjusted 3,519 56.58 Target Number Unvested as of June 30, 2021 327,028 $ 68.92 |
Other Income _ Expense (Tables)
Other Income / Expense (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Other Income and Expenses [Abstract] | |
Schedule of Other Nonoperating Income (Expense) | The components of other expense, net for the fiscal years ended June 30, 2021, 2020, and 2019 are as follows: Fiscal Year Ended (Dollars in millions) 2021 2020 2019 Other (income) expense, net Debt refinancing costs (1) $ 18 $ 16 $ 16 Foreign currency (gains) and losses (2) 5 (3) — Other (3) (20) (5) (13) Total other expense, net $ 3 $ 8 $ 3 (1) Debt refinancing costs for the fiscal year ended June 30, 2021 includes (a) a write-off of $4 million of previously capitalized financing charges related to the Company’s repaid Term B-2 Loans and the 2026 Notes, (b) $3 million of financing charges related to the Company’s Term B-3 Loans, and (c) an $11 million premium on early redemption of the 2026 Notes. Debt financing costs for the fiscal year ended June 30, 2020 includes (x) a write-off of $6 million of previously capitalized financing charges related to the Company's repaid euro-denominated term loans under its senior secured credit facilities and the Company's redeemed 2024 Notes, and (y) a $10 million premium on early redemption of the 2024 Notes. Debt financing costs for the fiscal year ended June 30, 2019 includes $16 million of financing charges related to the offering of the 2028 Notes. (2) Foreign currency (gains) and losses include both cash and non-cash transactions. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Leases [Abstract] | |
Schedule of Operating and Financing Leases Presented in Balance Sheet | Supplemental information concerning the leases recorded in the Company's consolidated balance sheet as of June 30, 2021 is detailed in the following table: (Dollars in millions) Line item in the consolidated balance sheet Balance at Right-of-use assets: Finance leases Property, plant, and equipment, net $ 139 Operating leases Other long-term assets 84 Current lease liabilities: Finance leases Current portion of long-term obligations and other short-term borrowings 15 Operating leases Other accrued liabilities 16 Non-current lease liabilities: Finance leases Long-term obligations, less current portion 178 Operating leases Other liabilities $ 73 |
Lease, Cost | The components of the net lease costs for the fiscal year ended June 30, 2021 reflected in the Company's consolidated statement of operations were as follows: (Dollars in millions) Fiscal Year Ended Financing lease costs: Amortization of right-of-use assets $ 16 Interest on lease liabilities 11 Total 27 Operating lease costs 29 Variable lease costs 10 Total lease costs $ 66 The short-term lease cost amounted to $4 million during the fiscal year ended June 30, 2021. The weighted average remaining lease term and weighted average discount rate related to the Company's right-of-use assets and lease liabilities as of June 30, 2021 are as follows: Weighted average remaining lease term (years): Finance leases 12.6 Operating leases 11.8 Weighted average discount rate: Finance leases 7.2 % Operating leases 4.8 % |
Schedule of Cash Flow, Supplemental Disclosures | Supplemental information concerning the cash-flow impact arising from the Company's leases for the fiscal year ended June 30, 2021 recorded in the Company's unaudited consolidated statement of cash flows is detailed in the following table (in millions): Fiscal Year Ended Cash paid for amounts included in lease liabilities: Financing cash flows used for finance leases $ 15 Operating cash flows used for finance leases 10 Operating cash flows used for operating leases 21 Non-cash transactions: Right-of-use assets obtained in exchange for new finance lease liabilities 57 Right-of-use assets obtained in exchange for new operating lease liabilities $ 13 |
Schedule of Maturities of Lease Liabilities | As of June 30, 2021, the Company expects that its future minimum lease payments will become due and payable as follows: (Dollars in millions) Financing Leases Operating Leases Total 2022 $ 26 $ 18 $ 44 2023 25 17 42 2024 24 14 38 2025 22 11 33 2026 18 9 27 Thereafter 175 52 227 Total minimum lease payments 290 121 411 Less: interest 97 32 129 Total lease liabilities $ 193 $ 89 $ 282 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended | |
Jun. 30, 2021 | ||
Segment Reporting [Abstract] | ||
Net Revenue and Segment EBITDA | The following tables include net revenue and Segment EBITDA for each of the Company's current reporting segments during the fiscal years ended June 30, 2021, 2020, and 2019: (Dollars in millions) Fiscal Year Ended June 30, 2021 2020 2019 Net revenue: Biologics $ 1,928 $ 1,021 $ 573 Softgel and Oral Technologies 1,012 1,062 1,039 Oral and Specialty Delivery 686 676 598 Clinical Supply Services 391 345 322 Inter-segment revenue elimination (19) (10) (14) Net revenue $ 3,998 $ 3,094 $ 2,518 (Dollars in millions) Fiscal Year Ended June 30, 2021 2020 2019 Segment EBITDA reconciled to net earnings: Biologics $ 608 $ 237 $ 147 Softgel and Oral Technologies 237 257 236 Oral and Specialty Delivery 160 201 175 Clinical Supply Services 108 91 85 Subtotal $ 1,113 $ 786 $ 643 Reconciling items to net earnings Unallocated costs (1) 1 (146) (143) Depreciation and amortization (289) (254) (229) Interest expense, net (110) (126) (111) Income tax expense (130) (39) (23) Net earnings $ 585 $ 221 $ 137 (1) Unallocated costs include restructuring and special items, stock-based compensation, gain (loss) on sale of subsidiary, impairment charges, certain other corporate directed costs, and other costs that are not allocated to the segments as follows: (Dollars in millions) Fiscal Year Ended June 30, 2021 2020 2019 Impairment charges and gain (loss) on sale of assets $ (9) $ (5) $ (5) Stock-based compensation (51) (48) (33) Restructuring and other special items (a) (31) (42) (58) Gain (loss) on sale of subsidiary (b) 182 (1) — Other expense, net (c) (3) (8) (3) Non-allocated corporate costs, net (87) (42) (44) Total unallocated costs $ 1 $ (146) $ (143) (a) Restructuring and other special items for the fiscal year ended June 30, 2021 include transaction and integration costs associated with the Anagni, MaSTherCell, Skeletal, Delphi, and Acorda acquisitions, and restructuring costs associated with the closure of the Company's Clinical Supply Services facility in Bolton, U.K. Restructuring and other special items during the fiscal year ended June 30, 2020 include transaction and integration costs associated with the Company’s cell and gene therapy acquisitions and the disposal of a facility in Australia. Restructuring and other special items during fiscal 2019 include transaction and integration costs associated with the acquisitions of Paragon Bioservices, Inc. and Juniper Pharmaceuticals, Inc., and the disposal of a facility in Australia. (b) Gain on sale of subsidiary for the fiscal year ended June 30, 2021 is affiliated with the sale of the Blow-Fill-Seal Business. Loss on sale of subsidiary for the fiscal year ended June 30, 2020 is affiliated with the disposal of the Australia facility. (c) Refer to Note 15, Other expense, net , for details of financing charges and foreign currency translation adjustments recorded within other expense, net. | [1],[2],[3],[4] |
Total Assets for Each Segment and Reconciling in Consolidated Financial Statements | The following table includes total assets for each segment, as well as reconciling items necessary to total the amounts reported in the consolidated balance sheets. Total Assets (Dollars in millions) June 30, 2021 June 30, 2020 Biologics $ 4,973 $ 3,775 Softgel and Oral Technologies 1,604 1,502 Oral and Specialty Delivery 1,269 1,248 Clinical Supply Services 483 451 Corporate and eliminations 783 801 Total assets $ 9,112 $ 7,777 | |
Capital Expenditures by Segment | Capital Expenditures Fiscal Year Ended June 30, (Dollars in millions) 2021 2020 2019 Biologics $ 516 $ 330 $ 79 Softgel and Oral Technologies 61 54 83 Oral and Specialty Delivery 64 55 29 Clinical Supply Services 26 10 3 Corporate 19 17 24 Total capital expenditures $ 686 $ 466 $ 218 | |
Presentation of revenue and long-lived assets by geographic area | The following table presents long-lived assets (1) by geographic area: Long-Lived Assets (1) (Dollars in millions) June 30, 2021 June 30, 2020 United States $ 1,867 $ 1,396 Europe 541 405 Other 116 100 Total $ 2,524 $ 1,901 (1) Long-lived assets include property, plant, and equipment, net of accumulated depreciation. | |
[1] | Gain on sale of subsidiary for the fiscal year ended June 30, 2021 is affiliated with the sale of the Blow-Fill-Seal Business. Loss on sale of subsidiary for the fiscal year ended June 30, 2020 is affiliated with the disposal of the Australia facility. | |
[2] | Refer to Note 15, Other expense, net , for details of financing charges and foreign currency translation adjustments recorded within other expense, net. | |
[3] | Restructuring and other special items for the fiscal year ended June 30, 2021 include transaction and integration costs associated with the Anagni, MaSTherCell, Skeletal, Delphi, and Acorda acquisitions, and restructuring costs associated with the closure of the Company's Clinical Supply Services facility in Bolton, U.K. Restructuring and other special items during the fiscal year ended June 30, 2020 include transaction and integration costs associated with the Company’s cell and gene therapy acquisitions and the disposal of a facility in Australia. Restructuring and other special items during fiscal 2019 include transaction and integration costs associated with the acquisitions of Paragon Bioservices, Inc. and Juniper Pharmaceuticals, Inc., and the disposal of a facility in Australia. | |
[4] | Unallocated costs include restructuring and special items, stock-based compensation, gain (loss) on sale of subsidiary, impairment charges, certain other corporate directed costs, and other costs that are not allocated to the segments as follows: |
Supplemental Balance Sheet In_2
Supplemental Balance Sheet Information (Tables) | 12 Months Ended |
Jun. 30, 2021 | |
Balance Sheet Related Disclosures [Abstract] | |
Work-in-Process and Finished Goods Inventories Include Raw Materials, Labor and Overhead | Work-in-process and inventories include raw materials, labor, and overhead. Total inventories consist of the following: (Dollars in millions) June 30, June 30, Raw materials and supplies $ 469 $ 223 Work-in-process 151 123 Total inventories, gross 620 346 Inventory cost adjustment (57) (22) Total inventories $ 563 $ 324 |
Prepaid and Other Assets | Prepaid expenses and other current assets consist of the following: (Dollars in millions) June 30, June 30, Prepaid expenses $ 46 $ 29 Contract assets 181 61 Spare parts supplies 30 23 Prepaid income tax 22 15 Non-U.S. value-added tax 50 19 Other current assets 47 31 Total prepaid expenses and other $ 376 $ 178 |
Property and Equipment | Property, plant, and equipment, net consist of the following: (Dollars in millions) June 30, June 30, Land, buildings, and improvements $ 1,571 $ 1,251 Machinery and equipment 1,558 1,233 Furniture and fixtures 31 21 Construction in progress 543 440 Property and equipment, at cost 3,703 2,945 Accumulated depreciation (1,179) (1,044) Property, plant, and equipment, net $ 2,524 $ 1,901 |
Other Assets Non Current | Other long-term assets consist of the following: (Dollars in millions) June 30, June 30, Operating lease right-of-use-assets $ 84 $ 101 Note receivable 47 — Pension assets 43 32 Corporate-owned life insurance policies 35 23 Venture capital investments 38 5 Interest rate swap 2 — Other 19 13 Total other long-term assets $ 268 $ 174 |
Other Accrued Liabilities | Other accrued liabilities consist of the following: (Dollars in millions) June 30, June 30, Contract liability $ 305 $ 191 Accrued employee-related expenses 184 141 Accrued expenses 170 115 Operating lease liabilities 16 15 Restructuring accrual 4 3 Accrued interest 27 29 Accrued income tax 30 5 Total other accrued liabilities $ 736 $ 499 |
Basis of Presentation and Sum_3
Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Detail) shares in Millions | Jun. 15, 2020$ / sharesshares | Feb. 06, 2020$ / sharesshares | Jul. 31, 2014$ / sharesshares | Jun. 30, 2021customer$ / shares | Jun. 30, 2020$ / shares |
Stock Issued During Period, Shares, New Issues | shares | 7.7 | 8.4 | 48.9 | ||
Shares Issued, Price Per Share | $ 70.72 | $ 58.58 | $ 20.5 | ||
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 | |||
Number of Customers | customer | 7,000 |
Basis of Presentation and Sum_4
Basis of Presentation and Summary of Significant Accounting Policies Property and Equipment and Other Definite Lived Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Depreciation expense | $ 196 | $ 165 | $ 141 |
Interest Costs Capitalized | 17 | 11 | |
Gain (Loss) on Sale of Assets and Asset Impairment Charges | $ (9) | $ (5) | $ (5) |
Building And Improvements [Member] | Minimum [Member] | |||
Property, Plant and Equipment, Useful Life | 5 years | ||
Building And Improvements [Member] | Maximum [Member] | |||
Property, Plant and Equipment, Useful Life | 50 years | ||
Machinery and Equipment [Member] | Minimum [Member] | |||
Property, Plant and Equipment, Useful Life | 3 years | ||
Machinery and Equipment [Member] | Maximum [Member] | |||
Property, Plant and Equipment, Useful Life | 10 years | ||
Furniture and Fixtures [Member] | Minimum [Member] | |||
Property, Plant and Equipment, Useful Life | 3 years | ||
Furniture and Fixtures [Member] | Maximum [Member] | |||
Property, Plant and Equipment, Useful Life | 7 years |
Basis of Presentation and Sum_5
Basis of Presentation and Summary of Significant Accounting Policies Research and Development Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Research and Development Expense | $ 21 | $ 21 | $ 19 |
Basis of Presentation and Sum_6
Basis of Presentation and Summary of Significant Accounting Policies Recent Financial Accounting Standards (Details) $ in Millions | Jun. 30, 2021USD ($) |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Operating Lease, Liability | $ 89 |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | us-gaap:OtherLiabilities |
Revenue Recognition Disaggregat
Revenue Recognition Disaggregation of Revenue by type of activity and reporting segment (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Inter-segment revenue elimination | $ (19) | $ (10) | $ (14) |
Net revenue | 3,998 | 3,094 | 2,518 |
Softgel and Oral Technologies [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 1,012 | 1,062 | 1,039 |
Softgel and Oral Technologies [Member] | Manufacturing & Commercial Product Supply [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 877 | 955 | |
Softgel and Oral Technologies [Member] | Development Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 135 | 107 | |
Softgel and Oral Technologies [Member] | Clinical Supply Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 0 | 0 | |
Biologics [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 1,928 | 1,021 | 573 |
Biologics [Member] | Manufacturing & Commercial Product Supply [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 533 | 332 | |
Biologics [Member] | Development Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 1,395 | 689 | |
Biologics [Member] | Clinical Supply Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 0 | 0 | |
Oral and Specialty Drug Delivery [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 686 | 676 | 598 |
Oral and Specialty Drug Delivery [Member] | Manufacturing & Commercial Product Supply [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 455 | 450 | |
Oral and Specialty Drug Delivery [Member] | Development Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 231 | 226 | |
Oral and Specialty Drug Delivery [Member] | Clinical Supply Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 0 | 0 | |
Clinical Supply Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 391 | 345 | $ 322 |
Clinical Supply Services [Member] | Manufacturing & Commercial Product Supply [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 0 | 0 | |
Clinical Supply Services [Member] | Development Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 0 | 0 | |
Clinical Supply Services [Member] | Clinical Supply Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 391 | 345 | |
Total Catalent before inter-segment revenue elimination [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 4,017 | 3,104 | |
Total Catalent before inter-segment revenue elimination [Member] | Manufacturing & Commercial Product Supply [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 1,865 | 1,737 | |
Total Catalent before inter-segment revenue elimination [Member] | Development Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 1,761 | 1,022 | |
Total Catalent before inter-segment revenue elimination [Member] | Clinical Supply Services [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | $ 391 | $ 345 |
Revenue Recognition Disaggreg_2
Revenue Recognition Disaggregation of Revenue by Geography (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Disaggregation of Revenue [Line Items] | |||
Elimination of revenue attributable to multiple locations | $ (95) | $ (80) | |
Net revenue | 3,998 | 3,094 | $ 2,518 |
Europe | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 1,343 | 976 | |
International Other | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | 288 | 376 | |
United States [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net revenue | $ 2,462 | $ 1,822 |
Revenue Recognition Contractual
Revenue Recognition Contractual Liabilities (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Revenue Recognition and Deferred Revenue [Abstract] | ||
Contract with Customer, Liability | $ 321 | $ 218 |
Contract with Customer, Liability, Revenue Recognized | $ 196 |
Revenue Recognition Contractu_2
Revenue Recognition Contractual Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Text Block [Abstract] | ||
Contract with Customer, Asset | $ 181 | $ 61 |
Business Combinations Purchase
Business Combinations Purchase Agreement (Details) - USD ($) | Feb. 23, 2021 | Feb. 11, 2021 | Nov. 16, 2020 | Feb. 10, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | Jan. 01, 2020 | ||
Business Acquisition [Line Items] | ||||||||||
Payment for acquisitions, net of cash acquired | $ (147,000,000) | $ (379,000,000) | $ (1,291,000,000) | |||||||
Common stock, par value (usd per share) | $ 0.01 | $ 0.01 | ||||||||
Goodwill, Acquired During Period | $ 56,000,000 | [1] | $ 264,000,000 | [2] | ||||||
Anagni [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business Combination, Consideration Transferred | 55,000,000 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | $ 34,000,000 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory | $ 6,000,000 | |||||||||
MaSTherCell [Member] | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business Combination, Consideration Transferred | $ 323,000,000 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 26,000,000 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 51,000,000 | |||||||||
Skeletal Cell Therapy Support SA | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business Combination, Consideration Transferred | $ 15,000,000 | |||||||||
Goodwill, Acquired During Period | $ 9,000,000 | |||||||||
Hepatic Cell Therapy Support SA | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Payment for acquisitions, net of cash acquired | $ (15,000,000) | |||||||||
Kyoto | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Payment for acquisitions, net of cash acquired | $ (30,000,000) | |||||||||
Acorda Therapeutics, Inc | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business Combination, Consideration Transferred | $ 83,000,000 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 79,000,000 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory | 2,000,000 | |||||||||
Goodwill, Acquired During Period | $ 2,000,000 | |||||||||
Delphi Genetics SA | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business Combination, Consideration Transferred | 50,000,000 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 6,000,000 | |||||||||
Goodwill, Acquired During Period | 45,000,000 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Long-term Debt | 6,000,000 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets | 3,000,000 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 7,000,000 | |||||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | $ 5,000,000 | |||||||||
[1] | The addition in the Biologics segment relates to the Skeletal and Delphi acquisitions. The addition in the Oral and Specialty Delivery segment relates to the Acorda transaction. For further details, see Note 3, Business Combinations and Divestitures . | |||||||||
[2] | The increase in fiscal 2020 primarily relates to the MaSTherCell acquisition. See Note 3, Business Combinations and Divestitures . |
Business Combinations Net Asset
Business Combinations Net Assets Acquired (Details) - USD ($) | Jun. 30, 2021 | Feb. 23, 2021 | Feb. 10, 2020 | Jan. 01, 2020 |
Anagni [Member] | ||||
Net Assets Acquired from Business Combinations | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | $ 34,000,000 | |||
Business Combination, Purchase Consideration | 52,000,000 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory | 6,000,000 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Prepaid Expense and Other Assets | $ 12,000,000 | |||
MaSTherCell [Member] | ||||
Net Assets Acquired from Business Combinations | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | $ 26,000,000 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Net Assets | 1,000,000 | |||
Business Combination Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Liabilities | (8,000,000) | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | 70,000,000 | |||
Business Acquisition, Goodwill | 253,000,000 | |||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net | 323,000,000 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 51,000,000 | |||
Delphi Genetics SA | ||||
Net Assets Acquired from Business Combinations | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | $ 6,000,000 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 7,000,000 | |||
Customer-Related Intangible Assets [Member] | MaSTherCell [Member] | ||||
Net Assets Acquired from Business Combinations | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 46,000,000 |
Business Combinations, Divestit
Business Combinations, Divestitures (Details) - USD ($) $ in Millions | Feb. 23, 2021 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |||
Business Acquisition [Line Items] | |||||||
Goodwill, Acquired During Period | $ 56 | [1] | $ 264 | [2] | |||
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal | [3] | 182 | $ (1) | $ 0 | |||
Blow-Fill-Seal Business, Woodstock | |||||||
Business Acquisition [Line Items] | |||||||
Proceeds from Divestiture of Businesses and Interests in Affiliates | 300 | ||||||
Business Combination, Acquired Receivables, Gross Contractual Amount | 50 | ||||||
Business Combination, Acquired Receivable, Fair Value | [4] | 47 | |||||
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High | 50 | ||||||
Disposal Group, Including Discontinued Operation, Assets | 149 | ||||||
Goodwill, Acquired During Period | 54 | ||||||
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal | 182 | ||||||
Business Combination, Loan Discount | 3 | ||||||
Business Acquisition, Transaction Costs | 8 | ||||||
Business Combination, Working Capital Adjustments | 6 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | 2 | ||||||
Proceeds From Divestiture Of Businesses, Net Cash Proceeds | 287 | ||||||
Business Combination, Contingent Consideration, Asset | [5] | 0 | |||||
Business Combination, Consideration Transferred, Other | [6] | 16 | |||||
Cash and Noncash Divestiture, Amount of Consideration Received | 331 | ||||||
Accrued Liabilities, Fair Value Disclosure | $ 3 | ||||||
Delphi Genetics SA | |||||||
Business Acquisition [Line Items] | |||||||
Goodwill, Acquired During Period | $ 45 | ||||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | $ 5 | ||||||
[1] | The addition in the Biologics segment relates to the Skeletal and Delphi acquisitions. The addition in the Oral and Specialty Delivery segment relates to the Acorda transaction. For further details, see Note 3, Business Combinations and Divestitures . | ||||||
[2] | The increase in fiscal 2020 primarily relates to the MaSTherCell acquisition. See Note 3, Business Combinations and Divestitures . | ||||||
[3] | Gain on sale of subsidiary for the fiscal year ended June 30, 2021 is affiliated with the sale of the Blow-Fill-Seal Business. Loss on sale of subsidiary for the fiscal year ended June 30, 2020 is affiliated with the disposal of the Australia facility. | ||||||
[4] | The note receivable, which provides for interest at a rate of 5.0% paid in kind, had an estimated fair value of $47 million at June 30, 2021, which is the $50 million aggregate principal amount less a $3 million discount determined using a discounted cash flow model with the market interest rate as a significant input. | ||||||
[5] | The Company determined that the estimated fair value of the contingent consideration from the sale of the Blow-Fill-Seal Business at June 30, 2021 was zero, and therefore no contingent consideration was recorded at divestiture. If any contingent consideration is subsequently received, it will be recorded in the period in which it is received. The Company has elected an accounting policy to recognize increases in the carrying amount of the contingent consideration asset using the gain contingency guidance in ASC 450, Contingencies . | ||||||
[6] | Other includes $8 million of transaction expenses, a working capital adjustment of $6 million , and $2 million assumption of liabilities resulting in net cash proceed of $287 million for the fiscal year ended June 30, 2021, with an additional $3 million accrued at June 30, 2021 as a post-closing purchase price adjustment. The final post-closing purchase price adjustment was paid by the Company in August 2021. |
Goodwill - Carrying Amount of G
Goodwill - Carrying Amount of Goodwill (Detail) - USD ($) | 12 Months Ended | ||||
Jun. 30, 2021 | Jun. 30, 2020 | ||||
Goodwill [Roll Forward] | |||||
Beginning balance | $ 2,471,000,000 | $ 2,221,000,000 | |||
Goodwill, Acquired During Period | 56,000,000 | [1] | 264,000,000 | [2] | |
Goodwill, Transfers | [3] | 0 | |||
Goodwill, Other Increase (Decrease) | 3,000,000 | ||||
Foreign currency translation adjustments | 46,000,000 | (17,000,000) | |||
Ending balance | 2,519,000,000 | 2,471,000,000 | |||
Goodwill, Written off Related to Sale of Business Unit | [4] | (54,000,000) | |||
Softgel and Oral Technologies [Member] | |||||
Goodwill [Roll Forward] | |||||
Beginning balance | 505,000,000 | 409,000,000 | |||
Goodwill, Acquired During Period | 0 | 0 | |||
Goodwill, Transfers | [3] | 108,000,000 | |||
Foreign currency translation adjustments | 11,000,000 | (10,000,000) | |||
Ending balance | 516,000,000 | 505,000,000 | |||
Goodwill, Written off Related to Sale of Business Unit | 0 | ||||
Biologics [Member] | |||||
Goodwill [Roll Forward] | |||||
Beginning balance | 1,463,000,000 | 1,320,000,000 | |||
Goodwill, Acquired During Period | 54,000,000 | [1] | 264,000,000 | [2] | |
Goodwill, Transfers | [3] | (124,000,000) | |||
Goodwill, Other Increase (Decrease) | (2,000,000) | ||||
Foreign currency translation adjustments | 14,000,000 | 0 | |||
Ending balance | 1,531,000,000 | 1,463,000,000 | |||
Goodwill, Written off Related to Sale of Business Unit | 0 | 3,000,000 | |||
Oral and Specialty Drug Delivery [Member] | |||||
Goodwill [Roll Forward] | |||||
Beginning balance | 355,000,000 | 340,000,000 | |||
Goodwill, Acquired During Period | 2,000,000 | [1] | 0 | ||
Goodwill, Transfers | [3] | 16,000,000 | |||
Goodwill, Other Increase (Decrease) | 2,000,000 | ||||
Foreign currency translation adjustments | 13,000,000 | (3,000,000) | |||
Ending balance | 316,000,000 | 355,000,000 | |||
Goodwill, Written off Related to Sale of Business Unit | [4] | (54,000,000) | |||
Clinical Supply Services [Member] | |||||
Goodwill [Roll Forward] | |||||
Beginning balance | 148,000,000 | 152,000,000 | |||
Goodwill, Acquired During Period | 0 | 0 | |||
Goodwill, Transfers | [3] | 0 | |||
Goodwill, Other Increase (Decrease) | 0 | ||||
Foreign currency translation adjustments | 8,000,000 | (4,000,000) | |||
Ending balance | 156,000,000 | $ 148,000,000 | |||
Goodwill, Written off Related to Sale of Business Unit | $ 0 | ||||
[1] | The addition in the Biologics segment relates to the Skeletal and Delphi acquisitions. The addition in the Oral and Specialty Delivery segment relates to the Acorda transaction. For further details, see Note 3, Business Combinations and Divestitures . | ||||
[2] | The increase in fiscal 2020 primarily relates to the MaSTherCell acquisition. See Note 3, Business Combinations and Divestitures . | ||||
[3] | The reallocation in fiscal 2020 relates to adjustments to the Company’s reporting segments, as a result of which certain assets moved from the Biologics segment to the Oral and Specialty Delivery segment, and other assets moved from the Oral and Specialty Delivery segment to the Softgel and Oral Technologies segment. | ||||
[4] | Represents goodwill associated with the divestiture of the Blow-Fill-Seal Business. |
Definite Lived Long-Lived Ass_3
Definite Lived Long-Lived Assets - Other Intangible Assets Subject to Amortization (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Intangibles [Line Items] | ||
Gross Carrying Value | $ 1,462 | $ 1,442 |
Accumulated Amortization | (645) | (553) |
Net Carrying Value | $ 817 | $ 889 |
Core technology [Member] | ||
Intangibles [Line Items] | ||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 19 years | 19 years |
Gross Carrying Value | $ 140 | $ 135 |
Accumulated Amortization | (94) | (83) |
Net Carrying Value | $ 46 | $ 52 |
Customer relationships [Member] | ||
Intangibles [Line Items] | ||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 14 years | 14 years |
Gross Carrying Value | $ 1,024 | $ 1,021 |
Accumulated Amortization | (306) | (248) |
Net Carrying Value | $ 718 | $ 773 |
Product relationships [Member] | ||
Intangibles [Line Items] | ||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 11 years | 11 years |
Gross Carrying Value | $ 281 | $ 270 |
Accumulated Amortization | (237) | (217) |
Net Carrying Value | $ 44 | $ 53 |
Other Intangible Assets [Member] | ||
Intangibles [Line Items] | ||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 5 years | 5 years |
Gross Carrying Value | $ 17 | $ 16 |
Accumulated Amortization | (8) | (5) |
Net Carrying Value | $ 9 | $ 11 |
Definite Lived Long-Lived Ass_4
Definite Lived Long-Lived Assets - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Finite lived intangible assets disclosure [Abstract] | |||
Amortization expense | $ 93 | $ 89 | $ 88 |
Definite Lived Long-Lived Ass_5
Definite Lived Long-Lived Assets - Future Amortization Expense (Detail) $ in Millions | Jun. 30, 2021USD ($) |
Finite lived intangible assets disclosure [Abstract] | |
Finite-Lived Intangible Assets, Amortization Expense, Next Twelve Months | $ 93 |
Finite-Lived Intangible Assets, Amortization Expense, Year Two | 92 |
Finite-Lived Intangible Assets, Amortization Expense, Year Three | 91 |
Finite-Lived Intangible Assets, Amortization Expense, Year Four | 90 |
Finite-Lived Intangible Assets, Amortization Expense, Year Five | $ 83 |
Restructuring and Other Costs_2
Restructuring and Other Costs (Details) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021USD ($)employees | Jun. 30, 2020USD ($) | Jun. 30, 2019USD ($) | |
Restructuring Cost and Reserve [Line Items] | |||
Employee-related reorganization | $ 8 | $ 6 | $ 14 |
Facility exit and other costs | 2 | 0 | 0 |
Restructuring, Settlement and Impairment Provisions | 10 | $ 6 | $ 14 |
Bolton CS [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring, Settlement and Impairment Provisions | $ 7 | ||
Bolton CS [Member] | Minimum [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and Related Cost, Expected Number of Positions Eliminated | employees | 150 | ||
Restructuring and Related Cost, Expected Cost | $ 7 | ||
Bolton CS [Member] | Maximum [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and Related Cost, Expected Number of Positions Eliminated | employees | 180 | ||
Restructuring and Related Cost, Expected Cost | $ 8 |
Long-Term Obligations and Oth_3
Long-Term Obligations and Other Short-Term Borrowings - Additional Information (Detail) € in Millions, $ in Millions | 1 Months Ended | 12 Months Ended | |||||
Oct. 23, 2017USD ($) | Jun. 30, 2021USD ($) | Jun. 30, 2020USD ($) | Jun. 30, 2021EUR (€) | Feb. 28, 2021USD ($) | Oct. 18, 2017 | ||
Schedule Of Debt [Line Items] | |||||||
Debt, Current | $ 75 | $ 73 | |||||
Long-term Debt and Finance Lease Obligations | 3,166 | 2,945 | |||||
Debt Instrument, Unused Borrowing Capacity, Amount | 719 | ||||||
Letters of Credit Outstanding, Amount | 6 | ||||||
Payments to Acquire Businesses, Gross | $ 950 | ||||||
Installment Payment for Acquisition, Next Twelve Months | 50 | ||||||
Installment Payment for Acquisition, Year Two | 50 | ||||||
Installment Payment for Acquisition, Year Three | 50 | ||||||
Installment Payment for Acquisition, Year Four | 50 | ||||||
Unamortized Debt Issuance Expense | 38 | 39 | |||||
Amortization of Debt Issuance Costs | $ 6 | 6 | |||||
Debt Instrument Quarterly Amortization Rate | 0.25% | 0.25% | |||||
Senior Secured Credit Facility [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Pledge Percentage Of Capital Stock | 100.00% | ||||||
Pledge Percentage Of Equity Interest | 100.00% | ||||||
Maximum Percentage Of Voting Stock from non US subsidiary | 65.00% | ||||||
Term Loan Facility Incremental Dollar Term B-2 [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt and Capital Lease Obligations | $ 0 | 938 | |||||
Revolving Credit Facility - Two [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt and Capital Lease Obligations | 0 | 0 | |||||
Revolving Credit Commitments [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt Instrument, Increase (Decrease), Other, Net | $ 175 | ||||||
Four Point Seven Five Percent Senior Euro Denominated Notes [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Stated interest rate (percent) | 4.75% | 4.75% | |||||
U.S. Dollar-denominated 4.875% Senior Notes [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Stated interest rate (percent) | 4.875% | ||||||
U.S Dollar-denominated 5.00% Senior Notes [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt and Capital Lease Obligations | $ 500 | ||||||
Stated interest rate (percent) | 5.00% | 5.00% | |||||
2.375% Senior Euro Denominated Notes [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt and Capital Lease Obligations | € | € 825 | ||||||
Stated interest rate (percent) | 2.375% | 2.375% | |||||
Senior Unsecured Term Loan Facility [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt and Capital Lease Obligations | $ 50 | 98 | |||||
Capital Lease Obligations [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt and Capital Lease Obligations | 193 | 142 | |||||
Other Obligations [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt and Capital Lease Obligations | $ 3 | 1 | |||||
3.125% Senior US Denominated Notes | |||||||
Schedule Of Debt [Line Items] | |||||||
Stated interest rate (percent) | 3.125% | 3.125% | |||||
Term Loan Three Facility Dollar Denominated [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt and Capital Lease Obligations | $ 997 | 0 | |||||
Debt Instrument, Increase (Decrease), Other, Net | 67 | ||||||
Term Loan Two Facility Dollar Denominated [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt and Capital Lease Obligations | $ 933 | ||||||
Accrued Liabilities [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Payments to Acquire Businesses, Gross | $ 200 | ||||||
Reported Value Measurement [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt and Capital Lease Obligations | 3,241 | 3,018 | |||||
Debt Instrument, Fair Value Disclosure | 3,277 | 3,055 | |||||
Reported Value Measurement [Member] | Debt Issuance Costs | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt and Capital Lease Obligations | 36 | 37 | |||||
Level 2 [Member] | Reported Value Measurement [Member] | U.S. Dollar-denominated 4.875% Senior Notes [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt Instrument, Fair Value Disclosure | 0 | 450 | |||||
Level 2 [Member] | Reported Value Measurement [Member] | U.S Dollar-denominated 5.00% Senior Notes [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt Instrument, Fair Value Disclosure | 500 | 500 | |||||
Level 2 [Member] | Reported Value Measurement [Member] | 2.375% Senior Euro Denominated Notes [Member] | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt Instrument, Fair Value Disclosure | [1] | 984 | 926 | ||||
Level 2 [Member] | Reported Value Measurement [Member] | 3.125% Senior US Denominated Notes | |||||||
Schedule Of Debt [Line Items] | |||||||
Debt Instrument, Fair Value Disclosure | $ 550 | $ 0 | |||||
[1] | The increase in euro-denominated debt at June 30, 2021 compared to the prior year is primarily due to fluctuations in foreign currency exchange rates. |
Long-Term Obligations and Oth_4
Long-Term Obligations and Other Short-Term Borrowings- Maturities (Details) $ in Millions | Jun. 30, 2021USD ($) |
Long-term and Short-term Debt [Abstract] | |
Long-term Debt and Capital Lease Obligations, Repayments of Principal in Next Twelve Months | $ 75 |
Long Term Debt and Capital Lease Obligations Repayments of Principal in Year Two | 23 |
Long Term Debt and Capital Lease Obligations Repayments of Principal in Year Three | 24 |
Long Term Debt and Capital Lease Obligations Repayments of Principal in Year Four | 22 |
Long Term Debt and Capital Lease Obligations Repayments of Principal in Year Five | 20 |
Long Term Debt and Capital Lease Obligations Repayments of Principal After Year Five | 3,113 |
Total | $ 3,277 |
Long-Term Obligations and Oth_5
Long-Term Obligations and Other Short-Term Borrowings Fair Value Measurements of Financial Instruments - Carrying Amounts and Estimated Fair Value of FInancial Instruments (Details) € in Millions, $ in Millions | Jun. 30, 2021USD ($) | Jun. 30, 2021EUR (€) | Jun. 30, 2020USD ($) | |
Reported Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | $ 3,277 | $ 3,055 | ||
Debt and Capital Lease Obligations | 3,241 | 3,018 | ||
Estimate of Fair Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | 3,265 | 3,006 | ||
Debt and Capital Lease Obligations | 3,265 | 3,006 | ||
U.S. Dollar-denominated 4.875% Senior Notes [Member] | Level 2 [Member] | Reported Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | 0 | 450 | ||
U.S. Dollar-denominated 4.875% Senior Notes [Member] | Level 2 [Member] | Estimate of Fair Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | 0 | 464 | ||
U.S Dollar-denominated 5.00% Senior Notes [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt and Capital Lease Obligations | 500 | |||
U.S Dollar-denominated 5.00% Senior Notes [Member] | Level 2 [Member] | Reported Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | 500 | 500 | ||
U.S Dollar-denominated 5.00% Senior Notes [Member] | Level 2 [Member] | Estimate of Fair Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | 539 | 538 | ||
2.375% Senior Euro Denominated Notes [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt and Capital Lease Obligations | € | € 825 | |||
2.375% Senior Euro Denominated Notes [Member] | Level 2 [Member] | Reported Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | [1] | 984 | 926 | |
2.375% Senior Euro Denominated Notes [Member] | Level 2 [Member] | Estimate of Fair Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | 993 | 844 | ||
3.125% Senior US Denominated Notes | Level 2 [Member] | Reported Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | 550 | 0 | ||
3.125% Senior US Denominated Notes | Level 2 [Member] | Estimate of Fair Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | 524 | 0 | ||
Senior Secured Credit Facilities & Other [Member] | Level 2 [Member] | Reported Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | 1,243 | 1,179 | ||
Senior Secured Credit Facilities & Other [Member] | Level 2 [Member] | Estimate of Fair Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt Instrument, Fair Value Disclosure | 1,209 | 1,160 | ||
Debt Issuance Costs | Reported Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt and Capital Lease Obligations | 36 | 37 | ||
Debt Issuance Costs | Estimate of Fair Value Measurement [Member] | ||||
Fair Value Measurements Of Financial Instruments [Line Items] | ||||
Debt and Capital Lease Obligations | $ 0 | $ 0 | ||
[1] | The increase in euro-denominated debt at June 30, 2021 compared to the prior year is primarily due to fluctuations in foreign currency exchange rates. |
Long-Term Obligations and Oth_6
Long-Term Obligations and Other Short-Term Borrowings Interest Rate (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Feb. 28, 2021 | Jun. 30, 2020 | |
Term Loan Three Facility Dollar Denominated [Member] | |||
Debt Instrument [Line Items] | |||
Debt and Capital Lease Obligations | $ 997 | $ 0 | |
Term Loan Three Facility Dollar Denominated [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Basis Spread on Variable Rate | 2.00% | ||
Term Loan Three Facility Dollar Denominated [Member] | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Basis Spread on Variable Rate | 0.50% | ||
Revolving Credit Facility - Two [Member] | |||
Debt Instrument [Line Items] | |||
Debt and Capital Lease Obligations | $ 0 | 0 | |
Senior Unsecured Term Loan Facility [Member] | |||
Debt Instrument [Line Items] | |||
Debt and Capital Lease Obligations | $ 50 | $ 98 | |
Revolving Credit Facility | London Interbank Offered Rate (LIBOR) [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Basis Spread on Variable Rate | 2.25% | ||
Revolving Credit Facility | London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Basis Spread on Variable Rate | 2.00% | ||
Term Loan Two Facility Dollar Denominated [Member] | |||
Debt Instrument [Line Items] | |||
Debt and Capital Lease Obligations | $ 933 |
Earnings Per Share Calculations
Earnings Per Share Calculations of Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |||
Net earnings | $ 585 | $ 221 | $ 137 |
Participating Securities, Distributed and Undistributed (Earnings) Loss, Basic | (56) | (48) | (5) |
Net Income (Loss) Available to Common Stockholders, Basic | $ 529 | $ 173 | $ 132 |
Weighted Average Number of Shares Outstanding, Basic | 168 | 150 | 144 |
Dilutive Securities, Effect on Basic Earnings Per Share, Dilutive Convertible Securities | 2 | 2 | 2 |
Weighted Average Number of Shares Outstanding, Diluted | 170 | 152 | 146 |
Earnings Per Share, Basic | $ 3.15 | $ 1.16 | $ 0.92 |
Earnings Per Share, Diluted | $ 3.11 | $ 1.14 | $ 0.90 |
Earnings Per Share Earnings Per
Earnings Per Share Earnings Per Share - Additional Details (Details) - shares shares in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Series A Preferred Stock | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 10 | 13 | 2 |
Employee Stock Option [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 0 | 2 |
Restricted Stock Units (RSUs) [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 0 | 1 |
Performance Shares [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 0 | 0 | 1 |
Derivative Instruments and He_3
Derivative Instruments and Hedging Activities - Additional Information (Detail) - USD ($) $ in Millions | Nov. 23, 2020 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | May 17, 2019 |
Derivative [Line Items] | |||||
Derivatives used in Net Investment Hedge, Increase (Decrease), Gross of Tax | $ (56) | $ 3 | |||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | (3) | 6 | |||
Net accumulated gain related to investment hedges | 6 | ||||
Proceeds from Issuance of Redeemable Preferred Stock | 0 | 0 | $ 646 | ||
Payments of Stock Issuance Costs | 4 | ||||
Derivative, Gain (Loss) on Derivative, Net | 17 | 3 | $ 13 | ||
Embedded Derivative, Fair Value of Embedded Derivative Liability | $ 9 | 3 | |||
Derivative Liability | $ 24 | ||||
Embedded Derivative, Estimate of Embedded Derivative Liability | $ 40 | ||||
Cash Paid to Settle, Interest Rate Swap Agreement | $ 2 | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Inputs Reconciliation, Purchases, Sales, Issues, Settlements | $ 4 | ||||
U.S. Denominated Term Loan [Member] | |||||
Derivative [Line Items] | |||||
Debt Instrument, Interest Rate, Effective Percentage | 0.9985% | ||||
Total Debt, U.S Denominated Term Loan | $ 500 |
Fair Value Measures and Discl_3
Fair Value Measures and Disclosures (Details) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Marketable Securities | $ 71 | $ 0 |
Interest Rate Cash Flow Hedge Asset at Fair Value | 2 | 4 |
Trading Securities at Fair Value | 1 | 1 |
Series A Preferred Stock derivative liability | 3 | 24 |
Interest Rate Cash Flow Hedge Liability at Fair Value | 4 | |
Level 1 [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Marketable Securities | 71 | |
Interest Rate Cash Flow Hedge Asset at Fair Value | 0 | |
Trading Securities at Fair Value | 1 | 1 |
Series A Preferred Stock derivative liability | 0 | 0 |
Interest Rate Cash Flow Hedge Liability at Fair Value | 0 | |
Level 2 [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Marketable Securities | 0 | |
Interest Rate Cash Flow Hedge Asset at Fair Value | 2 | |
Trading Securities at Fair Value | 0 | 0 |
Series A Preferred Stock derivative liability | 0 | 0 |
Interest Rate Cash Flow Hedge Liability at Fair Value | 4 | |
Level 3 [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Marketable Securities | 0 | |
Interest Rate Cash Flow Hedge Asset at Fair Value | 0 | |
Trading Securities at Fair Value | 0 | 0 |
Series A Preferred Stock derivative liability | $ 3 | 24 |
Interest Rate Cash Flow Hedge Liability at Fair Value | $ 0 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Tax Contingency [Line Items] | ||||
Undistributed Earnings of Foreign Subsidiaries | $ 142 | |||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | (17) | |||
Deferred Tax Assets, Valuation Allowance | 65 | $ 53 | ||
Unrecognized Tax Benefits | 5 | 4 | $ 4 | $ 2 |
Unrecognized Tax Benefits, Interest on Income Taxes Accrued | 1 | $ 1 | ||
Foreign, Net Operating Loss [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | (17) | |||
Foreign, Net Operating Loss Established [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | 2 | |||
Domestic Tax Authority [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Operating Loss Carryforwards | 512 | |||
Operating Loss Carryforwards, Subject to Limitations, Section 382 | 229 | |||
Operating Loss Carryforwards, Indefinite Life | 432 | |||
State and Local Jurisdiction [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Operating Loss Carryforwards | $ 441 | |||
Operating Loss Carryforwards, Carry Forward Period | 20 years | |||
Deferred Tax Assets, Valuation Allowance | $ 39 | |||
Foreign Tax Authority [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Operating Loss Carryforwards | $ 161 | |||
Operating Loss Carryforwards, Carry Forward Period | 3 years |
Income Taxes Schedule of Income
Income Taxes Schedule of Income before Tax Domestic and Foreign (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |||
U.S. operations | $ 457 | $ 121 | $ 36 |
Non-U.S. operations | 258 | 139 | 124 |
Earnings from continuing operations before income taxes | $ 715 | $ 260 | $ 160 |
Income Taxes-Components of Inco
Income Taxes-Components of Income Tax Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Current Income Tax Expense (Benefit), Continuing Operations [Abstract] | |||
Federal | $ 8 | $ 1 | $ 2 |
State and local | 20 | 1 | 1 |
Non-U.S. | 38 | 33 | 26 |
Total current | 66 | 35 | 29 |
Deferred: | |||
Federal | 62 | 11 | 4 |
State and local | 7 | 6 | (12) |
Non-U.S. | (5) | (13) | 2 |
Total deferred | 64 | 4 | (6) |
Total provision | $ 130 | $ 39 | $ 23 |
Income Taxes-Income Tax Reconci
Income Taxes-Income Tax Reconciliation (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |||
Provision at U.S. federal statutory tax rate | $ 150,000,000 | $ 55,000,000 | $ 34,000,000 |
State and local income taxes | 26,000,000 | 6,000,000 | (1,000,000) |
Foreign tax rate differential | (14,000,000) | (6,000,000) | (3,000,000) |
Effective Income Tax Rate Reconciliation, Global intangible low tax income | 3,000,000 | 3,000,000 | 3,000,000 |
Permanent items | (5,000,000) | 2,000,000 | 5,000,000 |
Unrecognized tax positions | 3,000,000 | (1,000,000) | 1,000,000 |
Tax valuation allowance | (7,000,000) | (21,000,000) | (11,000,000) |
Effective Income Tax Rate Reconciliation, Tax Credit, Foreign, Amount | 24,000,000 | 3,000,000 | 4,000,000 |
Withholding Tax and other foreign taxes | 1,000,000 | 1,000,000 | 1,000,000 |
Change in tax rate | 2,000,000 | 4,000,000 | 1,000,000 |
Effective Income Tax Rate Reconciliation, Tax Credit, Research, Amount | (5,000,000) | (2,000,000) | (2,000,000) |
Other | 0 | 1,000,000 | (1,000,000) |
Total provision | $ 130,000,000 | $ 39,000,000 | $ 23,000,000 |
Income Taxes-Deferred Tax Asset
Income Taxes-Deferred Tax Assets (Details) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 |
Deferred income tax assets: | ||
Accrued liabilities | $ 43 | $ 30 |
Equity compensation | 15 | 16 |
Loss and tax credit carryforwards | 187 | 194 |
Foreign currency | 12 | 15 |
Pension | 24 | 28 |
Property-related | 14 | 9 |
Intangibles | 3 | 0 |
Deferred Income Tax, Operating Lease, Liabilities | (35) | (34) |
Euro Denominated Debt | 23 | 7 |
Total deferred income tax assets | 356 | 333 |
Valuation allowance | (65) | (53) |
Deferred Tax Assets, Net of Valuation Allowance | 291 | 280 |
Deferred income tax liabilities: | ||
Foreign currency | 0 | (8) |
Property-related | (171) | (100) |
Goodwill and other intangibles | (194) | (192) |
Deferred Income Tax, Right-of-Use Asset | (18) | (22) |
Other | (6) | (3) |
Total deferred income tax liabilities | (389) | (325) |
Deferred Tax Liabilities, Net | $ 98 | $ 45 |
Income Taxes-Balance Sheet (Det
Income Taxes-Balance Sheet (Details) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 |
Income Tax Disclosure [Abstract] | ||
Non-current deferred tax asset | $ 66 | $ 49 |
Non-current deferred tax liability | 164 | 94 |
Deferred Tax Liabilities, Net | 98 | 45 |
Marketable Securities | $ 71 | $ 0 |
Income Taxes-Unrecognized Tax B
Income Taxes-Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Reconciliation of Unrecognized Tax Benefits [Roll Forward] | |||
Beginning Balance | $ 4 | $ 4 | $ 2 |
Additions based on tax positions related to the current year | 2 | ||
Additions for tax positions of prior years | 1 | 1 | 3 |
Settlements | (2) | ||
Unrecognized Tax Benefits, Reduction Resulting from Lapse of Applicable Statute of Limitations | (1) | (1) | |
Ending Balance | $ 5 | $ 4 | $ 4 |
Employee Retirement Benefit P_3
Employee Retirement Benefit Plans-Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Multiemployer Plans, Estimated Annual Cash Contribution | $ 2 | |
Eberbach Pension Promissory Note or Loan [Member] | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Stated interest rate (percent) | 5.00% | |
Retirement Benefits [Member] | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Multiemployer Plan, Pension, Significant, Future Employer Contribution, Amount | $ 38 | $ 39 |
Employee Retirement Benefit P_4
Employee Retirement Benefit Plans-Accumulated Benefit Obligation (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Employer contributions between measurement date and reporting date | ||
Fair value of plan assets at beginning of year | $ 295 | |
Fair value of plan assets at end of year | 318 | $ 295 |
Retirement Benefits [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Amortization of Gain (Loss) | 3 | 5 |
Accumulated Benefit Obligation | 364 | 351 |
Change in Benefit Obligation | ||
Benefit obligation at beginning of year | 358 | 350 |
Company service cost | 4 | 4 |
Interest cost | 4 | 5 |
Curtailments | 0 | (1) |
Settlements | 0 | (4) |
Defined Benefit Plan, Benefit Obligation, Benefits Paid | 13 | 11 |
Actuarial (gain)/loss | (9) | 21 |
Exchange rate gain/(loss) | 28 | (6) |
Benefit obligation at end of year | 372 | 358 |
Employer contributions between measurement date and reporting date | ||
Fair value of plan assets at beginning of year | 295 | 272 |
Actual return on plan assets | (1) | 31 |
Company contributions | 11 | 12 |
Settlements | 0 | (4) |
Defined Benefit Plan, Plan Assets, Benefits Paid | (13) | (11) |
Exchange rate gain/(loss) | 26 | (5) |
Fair value of plan assets at end of year | 318 | 295 |
Funded status at end of year | (54) | (63) |
Net Pension assets (liabilities) | (54) | (63) |
Other Post-Retirement Benefits [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Defined Benefit Plan, Amortization of Gain (Loss) | 0 | 0 |
Accumulated Benefit Obligation | 2 | 3 |
Change in Benefit Obligation | ||
Benefit obligation at beginning of year | 3 | 3 |
Company service cost | 0 | 0 |
Interest cost | 0 | 0 |
Curtailments | 0 | 0 |
Settlements | 0 | 0 |
Defined Benefit Plan, Benefit Obligation, Benefits Paid | 1 | 0 |
Actuarial (gain)/loss | 0 | 0 |
Exchange rate gain/(loss) | 0 | 0 |
Benefit obligation at end of year | 2 | 3 |
Employer contributions between measurement date and reporting date | ||
Fair value of plan assets at beginning of year | 0 | 0 |
Actual return on plan assets | 0 | 0 |
Company contributions | 0 | 0 |
Settlements | 0 | 0 |
Defined Benefit Plan, Plan Assets, Benefits Paid | 0 | 0 |
Exchange rate gain/(loss) | 0 | 0 |
Fair value of plan assets at end of year | 0 | 0 |
Funded status at end of year | (2) | (3) |
Net Pension assets (liabilities) | $ (2) | $ (3) |
Employee Retirement Benefit P_5
Employee Retirement Benefit Plans-Balance Sheet (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Amounts Recognized in Statement of Financial Position | ||
Noncurrent assets | $ 32 | |
Retirement Benefits [Member] | ||
Amounts Recognized in Statement of Financial Position | ||
Noncurrent assets | $ 43 | 32 |
Current liabilities | (1) | (1) |
Noncurrent liabilities | (96) | (94) |
Funded status at end of year | (54) | (63) |
Amounts Recognized in Accumulated Other Comprehensive Income | ||
Prior service cost | (1) | (1) |
Net (gain)/loss | 62 | 62 |
Total accumulated other comprehensive income at the end of the year | 61 | 61 |
Additional Information for Plan with ABO in Excess of Plan Assets | ||
Projected benefit obligation | 130 | 165 |
Accumulated benefit obligation | 124 | 159 |
Fair value of plan assets | 32 | 70 |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | ||
Service cost | 4 | 4 |
Interest cost | 4 | 5 |
Expected return on plan assets | (11) | (11) |
Net (gain)/loss | 3 | 5 |
Net periodic benefit cost | 0 | 3 |
Other Post-Retirement Benefits [Member] | ||
Amounts Recognized in Statement of Financial Position | ||
Noncurrent assets | 0 | 0 |
Current liabilities | 0 | 0 |
Noncurrent liabilities | (2) | (3) |
Funded status at end of year | (2) | (3) |
Amounts Recognized in Accumulated Other Comprehensive Income | ||
Prior service cost | 0 | 0 |
Net (gain)/loss | (1) | (1) |
Total accumulated other comprehensive income at the end of the year | (1) | (1) |
Additional Information for Plan with ABO in Excess of Plan Assets | ||
Projected benefit obligation | 2 | 3 |
Accumulated benefit obligation | 2 | 3 |
Fair value of plan assets | 0 | 0 |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | ||
Service cost | 0 | 0 |
Interest cost | 0 | 0 |
Expected return on plan assets | 0 | 0 |
Net (gain)/loss | 0 | 0 |
Net periodic benefit cost | $ 0 | $ 0 |
Employee Retirement Benefit P_6
Employee Retirement Benefit Plans-AOCI (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Defined Benefit Plan, Amounts Recognized in Other Comprehensive Income (Loss) [Abstract] | |||
Net (gain)/loss arising during the year | $ 0 | $ (4) | $ 13 |
Retirement Benefits [Member] | |||
Defined Benefit Plan, Amounts Recognized in Other Comprehensive Income (Loss) [Abstract] | |||
Net (gain)/loss arising during the year | 3 | 1 | |
Net gain/(loss) recognized during the year | (3) | (5) | |
Total minimum pension liability, pretax | 0 | (4) | |
Other Comprehensive (Income) Loss, Defined Benefit Plan, Prior Service Cost (Credit), after Tax | 0 | (1) | |
Estimated Amounts to be Amortized from Accumulated Other Comprehensive Income into Net Periodic Benefit Cost | |||
Net (gain)/loss | $ 3 | $ 3 | |
Financial Assumptions Used to Determine Benefit Obligations at the Balance Sheet Date | |||
Discount rate (percent) | 1.60% | 1.40% | |
Rate of compensation increases (percent) | 2.00% | 1.60% | |
Financial Assumptions Used to Determine Net Periodic Benefit Cost for Financial Year | |||
Discount rate (percent) | 1.40% | 1.90% | |
Rate of compensation increases (percent) | 2.00% | 2.00% | |
Expected long-term rate of return (percent) | 3.60% | 4.30% | |
Expected Future Contributions | |||
Fiscal Year 2020 Expected Future Contributions | $ 8 | $ 10 | |
Other Post-Retirement Benefits [Member] | |||
Defined Benefit Plan, Amounts Recognized in Other Comprehensive Income (Loss) [Abstract] | |||
Net (gain)/loss arising during the year | 0 | 0 | |
Net gain/(loss) recognized during the year | 0 | 0 | |
Total minimum pension liability, pretax | 0 | 0 | |
Other Comprehensive (Income) Loss, Defined Benefit Plan, Prior Service Cost (Credit), after Tax | 0 | 0 | |
Estimated Amounts to be Amortized from Accumulated Other Comprehensive Income into Net Periodic Benefit Cost | |||
Net (gain)/loss | $ 0 | $ 0 | |
Financial Assumptions Used to Determine Benefit Obligations at the Balance Sheet Date | |||
Discount rate (percent) | 2.00% | 1.80% | |
Financial Assumptions Used to Determine Net Periodic Benefit Cost for Financial Year | |||
Discount rate (percent) | 1.80% | 3.00% | |
Expected Future Contributions | |||
Fiscal Year 2020 Expected Future Contributions | $ 0 | $ 0 |
Employee Retirement Benefit P_7
Employee Retirement Benefit Plans-Fiscal Year Maturity (Details) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 |
Retirement Benefits [Member] | ||
Expected Future Benefit Payments | ||
Defined Benefit Plan, Expected Future Benefit Payment, Next Twelve Months | $ 13 | $ 12 |
Defined Benefit Plan, Expected Future Benefit Payment, Year Two | 14 | 12 |
Defined Benefit Plan, Expected Future Benefit Payment, Year Three | 15 | 13 |
Defined Benefit Plan, Expected Future Benefit Payment, Year Four | 15 | 14 |
Defined Benefit Plan, Expected Future Benefit Payment, Year Five | 15 | 14 |
Defined Benefit Plan, Expected Future Benefit Payment, Five Fiscal Years Thereafter | $ 84 | $ 75 |
Actual Asset Allocation (percent) | 100.00% | 100.00% |
Actual Asset Allocation | $ 318 | $ 295 |
Target Asset Allocation (percent) | 100.00% | 100.00% |
Retirement Benefits [Member] | Equity Securities [Member] | ||
Expected Future Benefit Payments | ||
Actual Asset Allocation (percent) | 4.40% | 9.70% |
Actual Asset Allocation | $ 14 | $ 29 |
Target Asset Allocation (percent) | 4.50% | 10.10% |
Retirement Benefits [Member] | US Government Agencies Debt Securities [Member] | ||
Expected Future Benefit Payments | ||
Actual Asset Allocation (percent) | 30.60% | 26.80% |
Actual Asset Allocation | $ 97 | $ 79 |
Target Asset Allocation (percent) | 30.50% | 27.10% |
Retirement Benefits [Member] | Corporate Debt Securities [Member] | ||
Expected Future Benefit Payments | ||
Actual Asset Allocation (percent) | 21.00% | 24.80% |
Actual Asset Allocation | $ 67 | $ 73 |
Target Asset Allocation (percent) | 21.10% | 24.50% |
Retirement Benefits [Member] | Real Estate [Member] | ||
Expected Future Benefit Payments | ||
Actual Asset Allocation (percent) | 3.50% | 3.10% |
Actual Asset Allocation | $ 11 | $ 9 |
Target Asset Allocation (percent) | 3.50% | 3.10% |
Retirement Benefits [Member] | Insurance Contracts [Member] | ||
Expected Future Benefit Payments | ||
Actual Asset Allocation (percent) | 9.60% | 9.50% |
Actual Asset Allocation | $ 31 | $ 28 |
Target Asset Allocation (percent) | 9.60% | 9.50% |
Retirement Benefits [Member] | Other Assets [Member] | ||
Expected Future Benefit Payments | ||
Actual Asset Allocation (percent) | 30.90% | 26.10% |
Actual Asset Allocation | $ 98 | $ 77 |
Target Asset Allocation (percent) | 30.80% | 25.70% |
Other Post-Retirement Benefits [Member] | ||
Expected Future Benefit Payments | ||
Defined Benefit Plan, Expected Future Benefit Payment, Next Twelve Months | $ 0 | $ 0 |
Defined Benefit Plan, Expected Future Benefit Payment, Year Two | 0 | 0 |
Defined Benefit Plan, Expected Future Benefit Payment, Year Three | 0 | 0 |
Defined Benefit Plan, Expected Future Benefit Payment, Year Four | 0 | 0 |
Defined Benefit Plan, Expected Future Benefit Payment, Year Five | 0 | 0 |
Defined Benefit Plan, Expected Future Benefit Payment, Five Fiscal Years Thereafter | $ 1 | $ 1 |
Actual Asset Allocation (percent) | 0.00% | 0.00% |
Actual Asset Allocation | $ 0 | $ 0 |
Target Asset Allocation (percent) | 0.00% | 0.00% |
Other Post-Retirement Benefits [Member] | Equity Securities [Member] | ||
Expected Future Benefit Payments | ||
Actual Asset Allocation (percent) | 0.00% | 0.00% |
Actual Asset Allocation | $ 0 | $ 0 |
Target Asset Allocation (percent) | 0.00% | 0.00% |
Other Post-Retirement Benefits [Member] | US Government Agencies Debt Securities [Member] | ||
Expected Future Benefit Payments | ||
Actual Asset Allocation (percent) | 0.00% | 0.00% |
Actual Asset Allocation | $ 0 | $ 0 |
Target Asset Allocation (percent) | 0.00% | 0.00% |
Other Post-Retirement Benefits [Member] | Corporate Debt Securities [Member] | ||
Expected Future Benefit Payments | ||
Actual Asset Allocation (percent) | 0.00% | 0.00% |
Actual Asset Allocation | $ 0 | $ 0 |
Target Asset Allocation (percent) | 0.00% | 0.00% |
Other Post-Retirement Benefits [Member] | Real Estate [Member] | ||
Expected Future Benefit Payments | ||
Actual Asset Allocation (percent) | 0.00% | 0.00% |
Actual Asset Allocation | $ 0 | $ 0 |
Target Asset Allocation (percent) | 0.00% | 0.00% |
Other Post-Retirement Benefits [Member] | Insurance Contracts [Member] | ||
Expected Future Benefit Payments | ||
Actual Asset Allocation (percent) | 0.00% | 0.00% |
Actual Asset Allocation | $ 0 | $ 0 |
Target Asset Allocation (percent) | 0.00% | 0.00% |
Other Post-Retirement Benefits [Member] | Other Assets [Member] | ||
Expected Future Benefit Payments | ||
Actual Asset Allocation (percent) | 0.00% | 0.00% |
Actual Asset Allocation | $ 0 | $ 0 |
Target Asset Allocation (percent) | 0.00% | 0.00% |
Employee Retirement Benefit P_8
Employee Retirement Benefit Plans-Fair Value (Details) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 |
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | $ 318 | $ 295 |
Level 1 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Level 2 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 295 | 272 |
Level 3 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 23 | 21 |
Fair Value Measured at Net Asset Value | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 2 |
Equity Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 14 | 29 |
Equity Securities [Member] | Level 1 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Equity Securities [Member] | Level 2 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 14 | 29 |
Equity Securities [Member] | Level 3 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Equity Securities [Member] | Fair Value Measured at Net Asset Value | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Debt Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 164 | 152 |
Debt Securities [Member] | Level 1 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Debt Securities [Member] | Level 2 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 164 | 152 |
Debt Securities [Member] | Level 3 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Debt Securities [Member] | Fair Value Measured at Net Asset Value | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Real Estate [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 11 | 9 |
Real Estate [Member] | Level 1 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Real Estate [Member] | Level 2 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 11 | 7 |
Real Estate [Member] | Level 3 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Real Estate [Member] | Fair Value Measured at Net Asset Value | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 2 |
Other Assets [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 129 | 105 |
Other Assets [Member] | Level 1 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Other Assets [Member] | Level 2 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 106 | 84 |
Other Assets [Member] | Level 3 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 23 | 21 |
Other Assets [Member] | Fair Value Measured at Net Asset Value | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Hedge Funds [Member] | Level 2 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | $ 62 | $ 31 |
Employee Retirement Benefit P_9
Employee Retirement Benefit Plans-Level 3 (Details) - Level 3 [Member] $ in Millions | 12 Months Ended |
Jun. 30, 2021USD ($) | |
Employer contributions between measurement date and reporting date | |
Beginning balance | $ 21 |
Relating to assets still held at the reporting date | 3 |
Purchases, sales, settlements, contributions and benefits paid | (2) |
Transfers in and/or out of Level 3 | 1 |
Ending balance | 23 |
Insurance Contracts [Member] | |
Employer contributions between measurement date and reporting date | |
Beginning balance | 3 |
Relating to assets still held at the reporting date | 0 |
Purchases, sales, settlements, contributions and benefits paid | 0 |
Transfers in and/or out of Level 3 | 0 |
Ending balance | 3 |
Other Unobservable Assets [Member] | |
Employer contributions between measurement date and reporting date | |
Beginning balance | 18 |
Relating to assets still held at the reporting date | 3 |
Purchases, sales, settlements, contributions and benefits paid | (2) |
Transfers in and/or out of Level 3 | 1 |
Ending balance | $ 20 |
Employee Retirement Benefit _10
Employee Retirement Benefit Plans-Assumed Healthcare Trend Rates (Details) - Other Post-Retirement Benefits [Member] - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Effect of 1% Change in Healthcare Cost Trend Rate | ||
Fiscal Year 2020 Expected Future Contributions | $ 0 | $ 0 |
Discount rate (percent) | 2.00% | 1.80% |
Discount rate (percent) | 1.80% | 3.00% |
Post 65 [Member] | ||
Assumed Healthcare Cost Trend Rates at the Balance Sheet Date | ||
Healthcare cost trend rate-initial (percent) | 7.30% | (1.10%) |
Healthcare cost trend rate-ulitimate (percent) | 4.40% | 4.90% |
Year in which ultimate rates are reached | 2035 | 2032 |
Equity and Accumulated Other _3
Equity and Accumulated Other Comprehensive Income (Loss) Equity (Details) $ / shares in Units, number in Millions | Nov. 23, 2020USD ($)shares | Jun. 15, 2020USD ($)$ / sharesshares | Feb. 06, 2020USD ($)$ / sharesshares | Jul. 31, 2014$ / sharesshares | Jun. 30, 2021USD ($)$ / sharesshares | Jun. 30, 2020USD ($)$ / sharesshares | Jun. 30, 2019USD ($)$ / sharesshares | May 17, 2019USD ($) |
Equity [Abstract] | ||||||||
Common Stock, Shares Authorized | shares | 1,000,000,000 | 1,000,000,000 | ||||||
Common stock, par value (usd per share) | $ / shares | $ 0.01 | $ 0.01 | ||||||
Preferred Stock, Shares Authorized | shares | 100,000,000 | 100,000,000 | ||||||
Preferred Stock, Shares Issued & Outstanding | shares | 384,777 | 650,000 | ||||||
Preferred Stock, Par or Stated Value Per Share | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | |||||
Stock Issued During Period, Shares, New Issues | shares | 7,700,000 | 8,400,000 | 48,900,000 | |||||
Shares Issued, Price Per Share | $ / shares | $ 70.72 | $ 58.58 | $ 20.5 | |||||
Stock Issued During Period, Value, New Issues | $ | $ 548,000,000 | $ 494,000,000 | $ 82,000,000 | $ 1,042,000,000 | $ 447,000,000 | |||
Net Proceeds used to Repay Debt, Stock Issued During Period, New Issues | $ | $ 200,000,000 | $ 100,000,000 | ||||||
Stcok Issued During Period, Shares, Over-allotment Option | 1.2 | |||||||
Stock Issued During Period, Value, Over-allotment Option | $ | $ 82,000,000 | |||||||
Auction Market Preferred Securities, Stock Series [Line Items] | ||||||||
Preferred Stock, Shares Authorized | shares | 100,000,000 | 100,000,000 | ||||||
Preferred Stock, Par or Stated Value Per Share | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | |||||
Preferred Stock, Shares Issued | shares | 384,777 | 650,000 | 650,000 | |||||
Preferred Stock, Issuance Value | $ | $ 650,000,000 | |||||||
Preferred Stock, Value, Issued | $ | 1,000 | |||||||
Preferred Stock, Issuance Value, Net | $ | $ 646,000,000 | |||||||
Embedded Derivative, Estimate of Embedded Derivative Liability | $ | $ 40,000,000 | |||||||
Conversion of Stock, Shares Converted | shares | 265,223 | |||||||
Dividends, Preferred Stock, Stock | $ | $ 2,000,000 | |||||||
Convertible Preferred Stock, Shares Issued upon Conversion | shares | 20.33 | |||||||
Stock Issued During Period, Shares, Conversion of Convertible Securities | shares | 5,392,280 | |||||||
Preferred Stock, Shares Issued & Outstanding | shares | 384,777 | 650,000 | ||||||
Stock Issued During Period, Value, Conversion of Convertible Securities | $ | $ 253,000,000 | |||||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Inputs Reconciliation, Purchases, Sales, Issues, Settlements | $ | $ 4,000,000 | |||||||
Additional Paid-in Capital [Member] | ||||||||
Equity [Abstract] | ||||||||
Stock Issued During Period, Value, New Issues | $ | 82,000,000 | $ 1,042,000,000 | $ 446,000,000 | |||||
Auction Market Preferred Securities, Stock Series [Line Items] | ||||||||
Stock Issued During Period, Value, Conversion of Convertible Securities | $ | $ 253,000,000 | |||||||
Designated shares [Member] | ||||||||
Equity [Abstract] | ||||||||
Preferred Stock, Shares Authorized | shares | 1,000,000 | |||||||
Auction Market Preferred Securities, Stock Series [Line Items] | ||||||||
Preferred Stock, Shares Authorized | shares | 1,000,000 |
Equity and Accumulated Other _4
Equity and Accumulated Other Comprehensive Income (Loss) Accumulated Other Comprehensive Earnings/(Loss) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | Jun. 30, 2018 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | $ (317) | $ (386) | $ (354) | $ (326) |
Other comprehensive income /(loss), net of tax | 69 | (32) | (28) | |
Other Comprehensive (Income) Loss, Defined Benefit Plan, after Reclassification Adjustment, after Tax | 0 | (2) | 9 | |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | 67 | (31) | (19) | |
Other Comprehensive Income (Loss), Securities, Available-for-sale, Adjustment, after Tax | (1) | 0 | 0 | |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | 69 | (34) | (19) | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (2) | 9 | ||
Accumulated Translation Adjustment [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (268) | (335) | (304) | (285) |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | 67 | (31) | (19) | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | 0 | ||
Accumulated Defined Benefit Plans Adjustment [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (47) | (47) | (49) | (40) |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | 0 | 0 | 0 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | (2) | 9 | |
AOCI, Derivative Qualifying as Hedge, Excluded Component, Parent | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | 0 | (3) | 0 | 0 |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | 3 | (3) | 0 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | 0 | ||
ACOI, Accumulated Gain (Loss), Marketable Securities | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (1) | 0 | 0 | 0 |
Other Comprehensive Income (Loss), Securities, Available-for-sale, Adjustment, after Tax | (1) | 0 | 0 | |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (1) | 0 | 0 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | 0 | ||
AOCI, Accumulated Gain (Loss), Debt Securities, Available-for-sale, Parent | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (1) | (1) | (1) | $ (1) |
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | $ 0 | 0 | 0 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | $ 0 | $ 0 |
Equity and Accumulated Other _5
Equity and Accumulated Other Comprehensive Income (Loss)-Minimum Pension Liability (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Equity [Abstract] | |||
Net investment hedge | $ (56) | $ 3 | $ 12 |
Long term inter-company loans | 39 | (9) | (13) |
Translation adjustments | 72 | (25) | (16) |
Total foreign currency translation adjustments, pretax | 55 | (31) | (17) |
Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Tax | (12) | 0 | 2 |
Total foreign currency translation adjustments, net of tax | (31) | (19) | |
Net Derivative and Hedge (gain)/loss arising during the year | 4 | (4) | 0 |
Derivative and Hedge, (Income) Loss | 1 | (1) | 0 |
Other Comprehensive Income, Debt Securities, Derivative and Hedge, Gain (Loss), after Adjustment and Tax | 3 | (3) | 0 |
Net gain/(loss) arising during the year | 0 | 4 | (13) |
Pension liability tax | 0 | 2 | (4) |
Net change in minimum pension liability, net of tax | 0 | 2 | (9) |
Other Comprehensive Income (Loss), Securities, Available-for-Sale, Unrealized Holding Gain (Loss) Arising During Period, before Tax | (1) | 0 | 0 |
Other Comprehensive Income (Loss), Securities, Available-for-sale, Tax | 0 | 0 | 0 |
Other Comprehensive Income (Loss), Securities, Available-for-sale, Adjustment, after Tax | $ (1) | $ 0 | $ 0 |
Equity (Details)
Equity (Details) - USD ($) | 12 Months Ended | |||||||
Jun. 30, 2019 | Jun. 30, 2021 | Jun. 30, 2020 | Jun. 15, 2020 | Feb. 06, 2020 | May 17, 2019 | Jun. 30, 2018 | Jul. 31, 2014 | |
Redeemable Preferred Stock [Line Items] | ||||||||
Preferred Stock, Shares Authorized | 100,000,000 | 100,000,000 | ||||||
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 | $ 0.01 | |||||
Preferred Stock, Shares Issued | 650,000 | 384,777 | 650,000 | |||||
Preferred Stock, Issuance Value | $ 650,000,000 | |||||||
Preferred Stock, Value, Issued | 1,000 | |||||||
Shares Issued, Price Per Share | $ 70.72 | $ 58.58 | $ 20.5 | |||||
Preferred Stock, Value, Outstanding | $ 0 | $ 0 | ||||||
Preferred Stock, Issuance Value, Net | 646,000,000 | |||||||
Payments of Stock Issuance Costs | 4,000,000 | |||||||
Embedded Derivative, Estimate of Embedded Derivative Liability | $ 40,000,000 | |||||||
Redeemable Preferred Stock Outstandings | $ 607,000,000 | $ 359,000,000 | $ 607,000,000 | $ 0 | ||||
Designated shares [Member] | ||||||||
Redeemable Preferred Stock [Line Items] | ||||||||
Preferred Stock, Shares Authorized | 1,000,000 |
Equity Based Compensation (Addi
Equity Based Compensation (Additional) (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Additional Shares Authorized | 15,600,000 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Number of Shares, Period Increase (Decrease) | 2.25 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 726,000 | 166,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Option, Nonvested, Weighted Average Exercise Price | $ 24.36 | $ 15.22 | $ 9.49 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $ 64,000,000 | $ 18,000,000 | |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 1 year 9 months 18 days | ||
Weighted Average Grant Date Fair Value of Restricted Stock Unit | $ 47,000,000 | 43,000,000 | |
Stock Option Granted Contractual Term | 10 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost | $ 51,000,000 | 48,000,000 | $ 33,000,000 |
Restricted Stock Units (RSUs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 1 year 10 months 24 days | ||
Weighted Average Grant Date Fair Value of Restricted Stock Unit | $ 94.19 | 57.17 | 44.65 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value | $ 39,000,000 | $ 35,000,000 | $ 13,000,000 |
Employee Stock Option [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 27.00% | 23.00% | 22.00% |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate | 0.30% | 1.70% | 2.20% |
Employee Stock Option [Member] | Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 24.00% | 24.00% | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | 6 years 3 months | 6 years 3 months | 6 years 3 months |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate | 1.90% | 2.80% | |
Share Based Compensation Arrangement by Share Based Payment Award, Fair Value Assumptions, Expected Dividend Payments, Per Share | $ 0 | $ 0 | $ 0 |
Performance Shares [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 39.00% | 30.00% | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | 2 years 4 months 24 days | 2 years 4 months 24 days | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate | 0.10% | 1.50% | |
Performance Shares [Member] | Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 42.00% | 31.00% | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | 2 years 10 months 24 days | 2 years 10 months 24 days | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate | 0.20% | 1.80% | |
Share Based Compensation Arrangement by Share Based Payment Award, Fair Value Assumptions, Expected Dividend Payments, Per Share | $ 0 | $ 0 | |
Stock Compensation Plan - Omnibus [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $ 5,000,000 | $ 6,000,000 | $ 24,000,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested, Number of Shares | 231,000 | 329,000 | 1,179,000 |
Equity Based Compensation (Opti
Equity Based Compensation (Option Activity) (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Outstanding Options, Weighted Average Exercise Price | $ 49.77 | $ 35.53 | |
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | 88.10 | ||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Exercises in Period, Weighted Average Exercise Price | 26.25 | ||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Forfeitures in Period, Weighted Average Exercise Price | 48.83 | ||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Expirations in Period, Weighted Average Exercise Price | 41.16 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Weighted Average Exercise Price | 49.77 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Weighted Average Exercise Price | $ 38.14 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | (726,000) | (166,000) | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $ 64,000,000 | $ 18,000,000 | |
Payments Related to Tax Withholding for Share-based Compensation | 46,000,000 | 32,000,000 | $ 15,000,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | 7,000,000 | 4,000,000 | |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ 2,000,000 | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 1 year 9 months 18 days | ||
Employee Stock Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Payments Related to Tax Withholding for Share-based Compensation | $ 27,000,000 | $ 7,000,000 | |
Time [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 1,280,174 | 1,997,888 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 231,352 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | (870,210) | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period | (73,855) | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Expirations in Period | (5,001) | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number | 1,280,174 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Number | 480,235 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | 4 years 11 months 1 day | 8 years 7 months 17 days | |
Share Based Compensation Arrangement by Share Based Payment Award Options Vested and Expected to Vest Exercisable Exercised Weighted Average Remaining Contractual Term (duration) | 4 years 11 months 1 day | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Weighted Average Remaining Contractual Term | 6 years 8 months 8 days | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | $ 74,696,700 | $ 76,229,381 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | 63,527,893 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Aggregate Intrinsic Value | 74,696,700 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Aggregate Intrinsic Value | $ 33,607,419 | ||
Performance [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 1,280,174 | 85,482 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 0 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | (2,492) | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Forfeitures in Period | (82,990) | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Expirations in Period | 0 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number | 0 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Number | 0 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | 0 years | 5 years 3 days | |
Share Based Compensation Arrangement by Share Based Payment Award Options Vested and Expected to Vest Exercisable Exercised Weighted Average Remaining Contractual Term (duration) | 0 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Weighted Average Remaining Contractual Term | 0 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Intrinsic Value | $ 0 | $ 2,453,938 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | 222,251 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Aggregate Intrinsic Value | 0 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Aggregate Intrinsic Value | $ 0 |
Equity Based Compensation (RSU
Equity Based Compensation (RSU Activity) (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 502,000 | 748,000 | |
Payments Related to Tax Withholding for Share-based Compensation | $ 46,000,000 | $ 32,000,000 | $ 15,000,000 |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 1 year 9 months 18 days | ||
Weighted Average Grant Date Fair Value of Restricted Stock Unit | $ 47,000,000 | $ 43,000,000 | |
Time Based Restricted Stock Units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 764,356 | 1,081,648 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 283,495 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 492,274 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Period Increase (Decrease) | 108,513 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ 65.54 | $ 47.45 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | 93.58 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value | 43.62 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value | $ 57.85 | ||
Performance Shares [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 392,095 | 516,416 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 113,376 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 259,730 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Period Increase (Decrease) | (22,033) | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ 58.16 | $ 43.37 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | 88.57 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value | 36.27 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value | $ 47.47 | ||
Restricted Stock Units (RSUs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | 327,028 | 427,903 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 105,449 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 202,805 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Period Increase (Decrease) | 3,519 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ 68.92 | $ 49.02 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | 101.42 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value | 38.63 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value | $ 56.58 | ||
Restricted Stock Units (RSUs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period | 671,000 | 734,000 | |
Payments Related to Tax Withholding for Share-based Compensation | $ 31,000,000 | $ 24,000,000 | |
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options | $ 54,000,000 | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 1 year 10 months 24 days | ||
Weighted Average Grant Date Fair Value of Restricted Stock Unit | $ 94.19 | 57.17 | 44.65 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Fair Value | $ 39,000,000 | $ 35,000,000 | $ 13,000,000 |
Other Income _ Expense (Details
Other Income / Expense (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | ||
Other Income and Expenses [Abstract] | ||||
Other Nonoperating Expense | [1] | $ 18 | $ 16 | |
Foreign Currency Transaction Gain (Loss), Unrealized | [2] | (5) | $ 3 | 0 |
Other Nonoperating Income (Expense) | [3] | 20 | 5 | 13 |
Other (Income)/expense, net | (3) | (8) | (3) | |
Derivative, Gain (Loss) on Derivative, Net | 17 | 3 | $ 13 | |
Write-off of Deferred Debt Issuance Costs | 4 | 6 | ||
Early Repayment of Senior Debt | 11 | $ 10 | ||
Gain (Loss) on Extinguishment of Debt | $ 3 | |||
[1] | Debt refinancing costs for the fiscal year ended June 30, 2021 includes (a) a write-off of $4 million of previously capitalized financing charges related to the Company’s repaid Term B-2 Loans and the 2026 Notes, (b) $3 million of financing charges related to the Company’s Term B-3 Loans, and (c) an $11 million premium on early redemption of the 2026 Notes. Debt financing costs for the fiscal year ended June 30, 2020 includes (x) a write-off of $6 million of previously capitalized financing charges related to the Company's repaid euro-denominated term loans under its senior secured credit facilities and the Company's redeemed 2024 Notes, and (y) a $10 million premium on early redemption of the 2024 Notes. Debt financing costs for the fiscal year ended June 30, 2019 includes $16 million of financing charges related to the offering of the 2028 Notes. | |||
[2] | Foreign currency (gains) and losses include both cash and non-cash transactions. | |||
[3] | Other, for the fiscal years ended June 30, 2021 and 2020 includes, in part, total realized and unrealized gain of $17 million and $3 million, respectively, related to the fair value of the derivative liability associated with the Series A Preferred Stock. |
Leases - Schedule of Operating
Leases - Schedule of Operating and Finance Leases Presented in the Balance Sheet (Details) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 |
Assets and Liabilities, Lessee [Abstract] | ||
Finance Lease, Right-of-Use Asset, after Accumulated Amortization | $ 139 | |
Operating Lease, Right-of-Use Asset | 84 | $ 101 |
Finance Lease, Liability, Current | 15 | |
Operating Lease, Liability, Current | 16 | |
Finance Lease, Liability, Noncurrent | 178 | |
Operating Lease, Liability, Noncurrent | $ 73 |
Leases - Cost (Details)
Leases - Cost (Details) $ in Millions | 12 Months Ended |
Jun. 30, 2021USD ($) | |
Lease, Cost [Abstract] | |
Finance Lease, Right-of-Use Asset, Amortization | $ 16 |
Finance Lease, Interest Expense | 11 |
Finance Lease Expense | 27 |
Operating Lease, Expense | 29 |
Variable Lease, Cost | 10 |
Lease, Cost | 66 |
Short-Term Lease Costs | $ 4 |
Finance Lease, Weighted Average Remaining Lease Term | 12 years 7 months 6 days |
Operating Lease, Weighted Average Remaining Lease Term | 11 years 9 months 18 days |
Finance Lease, Weighted Average Discount Rate, Percent | 7.20% |
Operating Lease, Weighted Average Discount Rate, Percent | 4.80% |
Leases - Schedule of Supplement
Leases - Schedule of Supplemental Cash Flow Information (Details) $ in Millions | 12 Months Ended |
Jun. 30, 2021USD ($) | |
Cash Paid For Amounts Included In Measurement Of Lease Liabilities [Abstract] | |
Finance Lease, Principal Payments | $ 15 |
Finance Lease, Interest Payment on Liability | 10 |
Operating Lease, Payments | 21 |
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability | 57 |
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | $ 13 |
Leases - Schedule of Maturities
Leases - Schedule of Maturities of Operating And Finance Lease Liabilities (Details) $ in Millions | Jun. 30, 2021USD ($) |
Leases [Abstract] | |
Finance Lease, Liability, Payments, Due Year One | $ 26 |
Finance Lease, Liability, Payments, Due Year Two | 25 |
Finance Lease, Liability, Payments, Due Year Three | 24 |
Finance Lease, Liability, Payments, Due Year Four | 22 |
Finance Lease, Liability, Payments, Due Year Five | 18 |
Finance Lease, Liability, Payments, Due after Year Five | 175 |
Finance Lease, Liability, Payment, Due | 290 |
Finance Lease, Liability, Undiscounted Excess Amount | 97 |
Finance Lease, Liability | 193 |
Lessee, Operating Lease, Liability, Payments, Due Year One | 18 |
Lessee, Operating Lease, Liability, Payments, Due Year Two | 17 |
Lessee, Operating Lease, Liability, Payments, Due Year Three | 14 |
Lessee, Operating Lease, Liability, Payments, Due Year Four | 11 |
Lessee, Operating Lease, Liability, Payments, Due Year Five | 9 |
Lessee, Operating Lease, Liability, Payments, Due after Year Five | 52 |
Lessee, Operating Lease, Liability, Payments, Due | 121 |
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | 32 |
Operating Lease, Liability | 89 |
Total Lease Liability Payments Due Year One | 44 |
Total Lease Liability Payments Due Year Two | 42 |
Total Lease Liability Payments Due Year Three | 38 |
Total Lease Liability Payments Due Year Four | 33 |
Total Lease Liability Payments Due Year Five | 27 |
Total Lease Liability Payments Due After Year Five | 227 |
Total Lease Liability Payments Due | 411 |
Total Lease Liability Undiscounted Excess Amount | 129 |
Total Lease Liability | $ 282 |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | us-gaap:OtherLiabilities |
Finance Lease, Liability, Statement of Financial Position [Extensible List] | us-gaap:OtherLiabilities |
Segment Information - Net Reven
Segment Information - Net Revenue and Segment Ebitda (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Net revenue | $ 3,998 | $ 3,094 | $ 2,518 | |
Inter-segment revenue elimination | (19) | (10) | (14) | |
Impairment charges and gain/(loss) on sale of assets | (9) | (5) | (5) | |
Equity compensation | (51) | (48) | (33) | |
Restructuring and other special items | [1] | (31) | (42) | (58) |
Other income (expense), net | [2] | (3) | (8) | (3) |
Non-allocated corporate costs, net | (87) | (42) | (44) | |
Total unallocated costs | 1 | (146) | (143) | |
Softgel and Oral Technologies [Member] | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Net revenue | 1,012 | 1,062 | 1,039 | |
Segment EBITDA | 237 | 257 | 236 | |
Biologics [Member] | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Net revenue | 1,928 | 1,021 | 573 | |
Segment EBITDA | 608 | 237 | 147 | |
Oral and Specialty Drug Delivery [Member] | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Net revenue | 686 | 676 | 598 | |
Segment EBITDA | 160 | 201 | 175 | |
Clinical Supply Services [Member] | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Net revenue | 391 | 345 | 322 | |
Segment EBITDA | 108 | 91 | 85 | |
Total Catalent sub-total of Segment Reporting [Member] | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Segment EBITDA | $ 1,113 | $ 786 | $ 643 | |
[1] | Restructuring and other special items for the fiscal year ended June 30, 2021 include transaction and integration costs associated with the Anagni, MaSTherCell, Skeletal, Delphi, and Acorda acquisitions, and restructuring costs associated with the closure of the Company's Clinical Supply Services facility in Bolton, U.K. Restructuring and other special items during the fiscal year ended June 30, 2020 include transaction and integration costs associated with the Company’s cell and gene therapy acquisitions and the disposal of a facility in Australia. Restructuring and other special items during fiscal 2019 include transaction and integration costs associated with the acquisitions of Paragon Bioservices, Inc. and Juniper Pharmaceuticals, Inc., and the disposal of a facility in Australia. | |||
[2] | Refer to Note 15, Other expense, net , for details of financing charges and foreign currency translation adjustments recorded within other expense, net. |
Segment Information - Reconcili
Segment Information - Reconciliation of Earnings/ (loss) from Continuing Operations to Ebitda (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Segment Reporting [Abstract] | |||
Earnings/(loss) from continuing operations | $ 585 | $ 221 | $ 137 |
Total unallocated costs | (1) | 146 | 143 |
Depreciation and amortization | 289 | 254 | 229 |
Interest expense, net | 110 | 126 | 111 |
Income tax expense | $ 130 | $ 39 | $ 23 |
Segment Information Total Asset
Segment Information Total Assets (Details) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | $ 9,112 | $ 7,777 |
Softgel and Oral Technologies [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | 1,604 | 1,502 |
Biologics [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | 4,973 | 3,775 |
Oral and Specialty Drug Delivery [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | 1,269 | 1,248 |
Clinical Supply Services [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | 483 | 451 |
Corporate and Eliminations [Member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | $ 783 | $ 801 |
Segment Information Depreciatio
Segment Information Depreciation and Amortization (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Segment Reporting Information [Line Items] | |||
Depreciation and Amortization | $ 289 | $ 254 | $ 229 |
Segment Information Capital Exp
Segment Information Capital Expenditures (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2021 | Jun. 30, 2020 | Jun. 30, 2019 | |
Segment Reporting Information [Line Items] | |||
Capital expenditures | $ 686 | $ 466 | $ 218 |
Softgel and Oral Technologies [Member] | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | 61 | 54 | 83 |
Biologics [Member] | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | 516 | 330 | 79 |
Oral and Specialty Drug Delivery [Member] | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | 64 | 55 | 29 |
Clinical Supply Services [Member] | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | 26 | 10 | 3 |
Corporate [Member] | |||
Segment Reporting Information [Line Items] | |||
Capital expenditures | $ 19 | $ 17 | $ 24 |
Segment Information - Assets an
Segment Information - Assets and Revenues (Detail) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 | |
Segment Reporting Information [Line Items] | |||
Property, Plant and Equipment, Net | [1] | $ 2,524 | $ 1,901 |
United States [Member] | |||
Segment Reporting Information [Line Items] | |||
Property, Plant and Equipment, Net | [1] | 1,867 | 1,396 |
Europe | |||
Segment Reporting Information [Line Items] | |||
Property, Plant and Equipment, Net | [1] | 541 | 405 |
International Other [Member] | |||
Segment Reporting Information [Line Items] | |||
Property, Plant and Equipment, Net | [1] | $ 116 | $ 100 |
[1] | Long-lived assets include property, plant, and equipment, net of accumulated depreciation. |
Supplemental Balance Sheet In_3
Supplemental Balance Sheet Information - Work-in-Process and Finished Goods Inventories Include Raw Materials, Labor and Overhead (Detail) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 |
Balance Sheet Related Disclosures [Abstract] | ||
Raw materials and supplies | $ 469 | $ 223 |
Work-in-process | 151 | 123 |
Total inventory, gross | 620 | 346 |
Inventory cost adjustment | (57) | (22) |
Inventories | $ 563 | $ 324 |
Supplemental Balance Sheet In_4
Supplemental Balance Sheet Information - Prepaid and Other Assets (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Jun. 30, 2021 | Jun. 30, 2020 | |
Balance Sheet Related Disclosures [Abstract] | ||
Prepaid Expense, Current | $ 46 | $ 29 |
Contract with Customer, Asset | 181 | 61 |
Spare Parts | 30 | 23 |
Prepaid Taxes | 22 | 15 |
Value Added Tax Receivable | 50 | 19 |
Other current assets | 47 | 31 |
Prepaid Expense and Other Assets, Current | $ 376 | $ 178 |
Supplemental Balance Sheet In_5
Supplemental Balance Sheet Information - Property and Equipment (Detail) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 | |
Balance Sheet Related Disclosures [Abstract] | |||
Land, buildings, and improvements | $ 1,571 | $ 1,251 | |
Machinery and equipment | 1,558 | 1,233 | |
Furniture and fixtures | 31 | 21 | |
Construction in progress | 543 | 440 | |
Property and equipment, at cost | 3,703 | 2,945 | |
Accumulated depreciation | (1,179) | (1,044) | |
Property, plant, and equipment, net | [1] | $ 2,524 | $ 1,901 |
[1] | Long-lived assets include property, plant, and equipment, net of accumulated depreciation. |
Supplemental Balance Sheet In_6
Supplemental Balance Sheet Information - Other Assets Non Current (Detail) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 |
Balance Sheet Related Disclosures [Abstract] | ||
Pension Asset | $ 43 | |
Alternative Investment | 38 | $ 5 |
Operating Lease, Right-of-Use Asset | 84 | 101 |
Other Assets, Miscellaneous, Noncurrent | 19 | 13 |
Other Assets, Noncurrent | 268 | 174 |
Noncurrent assets | 32 | |
Loans and Leases Receivable, Gross | 47 | 0 |
Cash Surrender Value of Life Insurance | 35 | 23 |
Interest Rate Derivative Assets, at Fair Value | $ 2 | $ 0 |
Supplemental Balance Sheet In_7
Supplemental Balance Sheet Information - Other Accrued Liabilities (Detail) - USD ($) $ in Millions | Jun. 30, 2021 | Jun. 30, 2020 |
Balance Sheet Related Disclosures [Abstract] | ||
Accrued employee-related expenses | $ 184 | $ 141 |
Restructuring accrual | 4 | 3 |
Interest Payable, Current | 27 | 29 |
Deferred revenue and fees | 305 | 191 |
Accrued income tax | 30 | 5 |
Other accrued liabilities and expenses | 170 | 115 |
Other accrued liabilities | 736 | 499 |
Accrued Operating Lease, Liabilities | $ 16 | $ 15 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions | Aug. 30, 2021USD ($) |
Zenyatta | Subsequent Event [Member] | |
Subsequent Event [Line Items] | |
Business Combination, Contingent Consideration, Liability, Current | $ 1,000 |