Financial Release
"In our first quarter as an independent company,
First-Quarter Results
- Worldwide sales were
$4.329 billion in the first quarter, up 3.7 percent. On an operational basis, sales increased 5.1 percent, excluding a 1.4 percent unfavorable impact from foreign exchange rate fluctuations. Sales increased in the quarter despite the decline inTriCor /Trilipix sales due to the loss of exclusivity. Excluding TriCor/Trilipix sales and foreign exchange, sales increased 8.6 percent in the first quarter. - Sales growth was driven by the continued strength of HUMIRA, both in
the United States and internationally. Global HUMIRA sales increased 16.0 percent, or 17.3 percent on an operational basis, excluding the impact of foreign exchange rate fluctuations. U.S. HUMIRA sales grew 23.7 percent due to growth in dermatology and gastroenterology, as well as the global launch of the ulcerative colitis indication. - First-quarter adjusted gross margin ratio was 76.2 percent, as expected, excluding intangible asset amortization and other specified items. This reflects both the loss of exclusivity within our lipid franchise, as well as the effect of unfavorable foreign exchange rate fluctuations on the ratio. The gross margin ratio under U.S. generally accepted accounting principles (GAAP) was 73.4 percent.
- Adjusted SG&A was 27.9 percent of sales in the first quarter, reflecting continued investment in our growth brands and the incremental costs of becoming an independent company. On a GAAP basis, SG&A was 28.6 percent of sales.
- Adjusted R&D was 14.6 percent of sales in the first quarter, reflecting funding actions in support of our emerging mid- and late-stage pipeline assets and the continued pursuit of additional HUMIRA indications. On a GAAP basis, R&D was 14.6 percent of sales.
- Net interest expense was
$66 million in the first quarter, and adjusted other income was$18 million . On a GAAP basis, other income was$15 million . - The adjusted tax rate was 22.2 percent in the quarter. On a GAAP basis, the first-quarter tax rate was 21.9 percent.
- First-quarter diluted earnings per share were
$0.60 on a GAAP basis. Adjusted diluted earnings per share, excluding intangible asset amortization expense and other specified items, were$0.68 , above the company's previous guidance range.
Key Events from the
- Earlier this week,
AbbVie presented new data from its rapidly-advancing hepatitis C program at the annual meeting of theEuropean Association for the Study of the Liver (EASL). New data from the Phase 2b AVIATOR study show SVR rates of greater than 90 percent in naive and prior null responder patients treated withAbbVie 's 3-DAA+RBV regimen, across HCV subtype, IL28B genotype, baseline HCV-RNA or severity of fibrosis. We expect our ongoing Phase 3 studies to begin to read out later this year and into early 2014, supporting mid-2014 registration submissions. - Initiated Phase 2b studies of elagolix in uterine fibroids. Elagolix is currently in Phase 3 development for endometriosis. Both conditions are prevalent with few treatment options.
- Initiated additional Phase 2b studies of ABT-719, our novel investigational compound for the prevention of acute kidney injury. We expect ABT-719 to advance into Phase 3 studies in early 2014.
- ABT-199, our next-generation BcL-2 inhibitor in development in partnership with
Roche /Genentech, was featured in a special symposium at theAmerican Association for Cancer Research (AACR) annual meeting earlier this month.AbbVie recently proposed an amended study protocol for ABT-199 in chronic lymphocytic leukemia. Upon approval by the U.S. Food and Drug Administration (FDA ), dose escalation and new patient recruitment will resume. AbbVie announced long-term, patient-reported health outcomes data for the use of HUMIRA in patients with pediatric Crohn's disease. Results from the Phase 3 IMAgINE-1 trial demonstrated improvements in health-related quality of life measures for patients aged 6 to 17 years with severe active Crohn's disease, taking HUMIRA, as well as the work productivity of their caregivers throughout the 52-week study.- Received
FDA approval for new Creon 36,000 lipase-unit capsules for patients with exocrine pancreatic insufficiency. Creon 36,000 is the highest dose of pancreatic therapy (PERT) currently available for patients. - On
February 15 , the board of directors ofAbbVie declared a quarterly cash dividend of$0.40 per share, payableMay 15, 2013 to stockholders of record at the close of business onApril 15 , 2013.AbbVie was named to theS&P 500 Dividend Aristocrats Index, which tracks companies that have annually increased their dividend for at least 25 consecutive years.AbbVie was included as a result of the Index's change in its treatment of spin-off companies. AbbVie 's board authorized a share repurchase program of up to$1.5 billion of the company's outstanding common stock. The share repurchase authorization is expected to be completed over a multi-year period and purchases may be made from time to time in management's discretion. The share repurchase authorization permits shares to be repurchased in open market or private transactions, has no time limit and may be discontinued at any time.
Full-Year 2013 Outlook
About
Conference Call
Non-GAAP Financial Results
Financial results for 2013 are presented on both a reported and a non-GAAP basis. Reported results were prepared in accordance with GAAP and include all revenue and expenses recognized during the period. Non-GAAP results adjust for certain non-cash items and for factors that are unusual or unpredictable, and exclude those costs, expenses, and other specified items presented in the reconciliation tables later in this release. AbbVie's management believes non-GAAP financial measures provide useful information to investors regarding
Forward-Looking Statements
Some statements in this news release may be forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "anticipate," "project" and similar expressions, among others, generally identify forward-looking statements.
AbbVie Inc. Key Product Sales Quarter Ended March 31, 2013 (Unaudited) |
||||||||
% Change vs. 1Q12 |
||||||||
Sales (in millions) |
International |
Total |
||||||
U.S. |
Int'l. |
Total |
U.S. |
Operational |
Reported |
Operational |
Reported |
|
TOTAL SALES |
$2,122 |
$2,207 |
$4,329 |
(0.4%) |
10.7% |
8.0% |
5.1% |
3.7% |
Humira |
956 |
1,288 |
2,244 |
23.7 |
13.0 |
10.9 |
17.3 |
16.0 |
Synagis |
-- |
345 |
345 |
n/m |
6.4 |
(0.3) |
5.1 |
(1.4) |
AndroGel |
240 |
-- |
240 |
3.4 |
n/a |
n/a |
3.4 |
3.4 |
Kaletra |
52 |
167 |
219 |
(5.5) |
2.4 |
0.6 |
0.5 |
(0.9) |
Niaspan |
186 |
-- |
186 |
(2.6) |
n/a |
n/a |
(2.6) |
(2.6) |
Lupron |
125 |
56 |
181 |
(11.3) |
(1.7) |
(3.4) |
(8.5) |
(9.0) |
TriCor/Trilipix |
128 |
-- |
128 |
(49.6) |
n/a |
n/a |
(49.6) |
(49.6) |
Synthroid |
119 |
-- |
119 |
(7.8) |
n/a |
n/a |
(7.8) |
(7.8) |
Creon |
90 |
-- |
90 |
32.4 |
n/a |
n/a |
32.4 |
32.4 |
Zemplar |
41 |
40 |
81 |
(22.6) |
8.1 |
8.1 |
(10.0) |
(10.0) |
Duodopa |
-- |
39 |
39 |
n/a |
8.3 |
8.3 |
8.3 |
8.3 |
Note: "Operational" growth reflects percentage change over the prior year excluding the impact of exchange rate fluctuations. |
n/m = not meaningful |
n/a = not applicable |
AbbVie Inc. Consolidated Statements of Earnings Quarters Ended March 31, 2013 and 2012 (Unaudited) (In millions, except per share data) |
|||
2013 |
2012 |
||
Net sales |
$4,329 |
$4,173 |
|
Cost of products sold |
1,153 |
1,156 |
|
Selling, general and administrative |
1,237 |
1,247 |
|
Research and development |
634 |
642 |
|
Acquired in-process research and development |
-- |
150 |
|
Total operating cost and expenses |
3,024 |
3,195 |
|
Operating earnings |
1,305 |
978 |
|
Interest expense, net |
66 |
(1) |
|
Net foreign exchange (gain) loss |
15 |
10 |
|
Other (income) expense, net |
(15) |
(37) |
|
Earnings before income tax |
1,239 |
1,006 |
|
Income tax expense |
271 |
123 |
|
Net earnings |
$968 |
$883 |
|
Diluted earnings per share |
$0.60 |
$0.56 |
|
Average diluted shares outstanding |
1,605 |
1,577 |
Note: On January 1, 2013, Abbott Laboratories distributed 1,577 million shares of AbbVie common stock to Abbott's shareholders in connection with the separation of AbbVie from Abbott. The computation of diluted earnings per share for the quarter ended March 31, 2012 was calculated using the shares distributed on January 1, 2013. |
AbbVie Inc. Reconciliation of GAAP Reported to Non-GAAP Adjusted Information Quarter Ended March 31, 2013 (Unaudited) (In millions, except per share data) |
||||
1. |
Specified items impacted results as follows: |
|||
1Q13 |
||||
Earnings |
Diluted |
|||
Pre-tax |
After-tax |
EPS |
||
As reported (GAAP) |
$1,239 |
$968 |
$0.60 |
|
Adjusted for specified items: |
||||
Intangible asset amortization |
135 |
98 |
0.06 |
|
Separation costs |
34 |
22 |
0.01 |
|
Restructuring/Other |
(1) |
7 |
0.01 |
|
As adjusted (non-GAAP) |
$1,407 |
$1,095 |
$0.68 |
Intangible asset amortization reflects costs recognized as a result of licensing and acquisition activities. Separation costs are expenses related to the separation of AbbVie from Abbott. Restructuring/Other is primarily associated with previously announced restructuring activities and the impact of the Venezuelan currency devaluation. |
||||||
2. |
The impact of the specified items by line item was as follows: |
|||||
1Q13 |
||||||
Cost of products sold |
SG&A |
R&D |
Net foreign exchange (gain) loss |
Other (income) expense |
||
As reported (GAAP) |
$1,153 |
$1,237 |
$634 |
$15 |
($15) |
|
Adjusted for specified items: |
||||||
Intangible asset amortization |
(135) |
-- |
-- |
-- |
-- |
|
Separation costs |
(3) |
(29) |
(2) |
-- |
-- |
|
Restructuring/Other |
17 |
(2) |
-- |
(11) |
(3) |
|
As adjusted (non-GAAP) |
$1,032 |
$1,206 |
$632 |
$4 |
($18) |
3. |
The adjusted tax rate for the first quarter was 22.2 percent, as detailed below: |
|||
1Q13 |
||||
Pre-tax |
Income |
|||
income |
taxes |
Tax rate |
||
As reported (GAAP) |
$1,239 |
$271 |
21.9% |
|
Specified items |
168 |
41 |
24.4% |
|
As adjusted (non-GAAP) |
$1,407 |
$312 |
22.2% |
SOURCE
Media, Jennifer Smoter, +1-847-935-8865, or Greg Miley, +1-847-938-4898, or Adelle Infante, +1-847-938-8745, or Investors, Larry Peepo, +1-847-935-6722, or Liz Shea, +1-847-935-2211