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$
2,541$
-$
2,541$
77,196$
-$
77,196-8 %-8 %Cost of sales
76,5058,457
(a)
68,04885,8187,969
(a)
77,849-11 %-13 %Gross profit
86,0368,45794,49391,3787,96999,347-6 %-5 %Operating expenses
21,9771,526
(c)
20,45121,404599
(c)
20,8053 %-2 %Operating income
$
4,059$
9,983$
74,042$
9,974$
8,568$
78,542-8 %-6 %Selected ratios as a percentage of net salesGross profit
52.9 %58.1 %51.6 %56.1 %Operating expenses
13.5 %12.6 %12.1 %11.7 %Operating income
39.4 %45.6 %39.5 %44.3 %(a) Deal-related amortization(b) Inventory step-up of $7,693(c) Severance costs(d) Inventory step-up of $27,179(e) Proceeds of $3,500 from sale of pipeline development projects(f) Severance costs of $3,755 Table II (Continued)PERRIGO COMPANYREPORTABLE SEGMENTSRECONCILIATION OF NON-GAAP MEASURES(in thousands)(unaudited)Six Months EndedRx PharmaceuticalsDecember 29, 2012December 31, 2011% ChangeGAAPNon-GAAP AdjustmentsAs AdjustedGAAPNon-GAAP AdjustmentsAs AdjustedGAAPAs AdjustedNet sales
$
325,483$
-$
325,483$
304,823$
-$
304,8237 %7 %Cost of sales
152,76316,859
(a)
135,904171,98542,501
(a,d)
129,484-11 %5 %Gross profit
172,72016,859189,579132,83842,501175,33930 %8 %Operating expenses
40,1571,526
(c)
38,63138,379255
(e,f)
38,1245 %1 %Operating income
$
32,563$
8,385$
50,948$
94,459$
42,756$
37,21540 %10 %Selected ratios as a percentage of net salesGross profit
53.1 %58.2 %43.6 %57.5 %Operating expenses
12.3 %11.9 %12.6 %12.5 %Operating income
40.7 %46.4 %31.0 %45.0 %Three Months EndedAPIDecember 29, 2012December 31, 20
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