Sandoz reports fourth quarter 2023 sales and full-year 2023 results
Ad hoc announcement pursuant to art. 53 SIX Swiss Exchange
Listing Rules
MEDIA RELEASE
- Strong fourth quarter performance, with net sales1
of USD 2.5 billion, up 10% in constant currencies (up 11% in
USD)
- Full-year 2023 net sales of USD 9.6 billion,
up 7% in constant currencies (up 6% in USD)
- Strong growth across all three regions and double-digit growth
in biosimilars both in the fourth quarter and full year
- Full-year 2023 core EBITDA margin of 18.1%,
with strong contribution from net sales offset by expected
inflation and standalone costs, and foreign exchange headwinds of
1.7 percentage points
- Full-year 2023 EBITDA margin of 9.5%, due to legal settlements,
one-time separation costs and rationalization of specific
manufacturing sites
- 2024 guidance of mid-single digit net sales growth in constant
currencies and core EBITDA margin around 20%
Basel, March 13, 2024 – Sandoz
(SIX:SDZ/OTCQX:SDZNY), the global leader in generic and biosimilar
medicines, today announced net sales for the fourth quarter and
results for the full year ended December 31, 2023. For the fourth
quarter, net sales were USD 2.5 billion, an increase of 10% in
constant currencies compared to the same quarter of the prior year.
For the full year, net sales were USD 9.6 billion, an increase of
7% in constant currencies compared to the prior year and core
EBITDA margin of 18.1%.
“2023 was a year of many achievements for Sandoz, thanks to the
passion and tireless efforts of our employees worldwide”, said
Richard Saynor, Chief Executive Officer of Sandoz. “We launched
Hyrimoz® (biosimilar adalimumab) in the US, expanded our
biosimilar pipeline through a commercialization agreement with
Samsung on biosimilar ustekinumab (reference medicine
Stelara®) and enhanced our generic portfolio with the
acquisition of Mycamine® (an anti-fungal agent), while
becoming an independent public company.”
Mr. Saynor continued: “These achievements came alongside strong
financial results, with sales growth in all three regions and
double-digit growth in biosimilars for the fourth quarter and full
year. Our full-year 2023 core EBITDA margin was 18.1%, in line with
our guidance despite foreign exchange headwinds, offering a solid
basis for our mid-term ambitions. We have also secured long-term
financing with two bond issuances and ended the year with a strong
cash balance of USD 1.1 billion, providing optionality for future
investments. We have entered 2024 with strong momentum and a deep
pipeline of products to create sustainable long-term value for our
shareholders and society.”
FOURTH QUARTER AND FULL-YEAR 2023 NET SALES
RESULTS
Net sales for the fourth quarter were USD 2.5 billion, up 10% in
constant currencies, compared to the fourth quarter of 2022. Volume
contributed 12 percentage points of growth, partially offset by
price erosion of 2 percentage points. All regions showed growth
this quarter with solid contribution from generics and strong
performance in biosimilars, across new and existing products.
Net sales for the full year were USD 9.6 billion, up 7% in
constant currencies compared to 2022. Volume contributed 10
percentage points of growth, partially offset by price erosion of 3
percentage points, a significant reduction compared to 6 percentage
points in 2022. Growth was driven by strong demand, product
launches and continued performance of Omnitrope® and
Hyrimoz®.
Net sales by business
| |
Three months ended December 31 |
|
Change % |
|
Twelve months ended December 31 |
|
Change % |
| USD millions
unless indicated otherwise |
2023 |
2022 |
|
USD |
cc* |
|
2023 |
2022 |
|
USD |
cc |
| Generics |
1 920 |
1 813 |
|
6 |
6 |
|
7 432 |
7 141 |
|
4 |
5 |
|
Biosimilars |
623 |
483 |
|
29 |
26 |
|
2 215 |
1 928 |
|
15 |
15 |
|
Net sales to third parties |
2 543 |
2 296 |
|
11 |
10 |
|
9 647 |
9 069 |
|
6 |
7 |
*Constant currencies
Generics overview
Net sales for the fourth quarter were USD 1.9 billion, up 6% in
constant currencies, compared to the fourth quarter of 2022. Growth
was driven by volume demand, the acquisition of
Mycamine®, an antifungal agent, the transfer of mature
brands from our former parent and price erosion below prior
year.
Net sales for the full year were USD 7.4 billion, up 5% in
constant currencies, driven by strong volume demand and recent
launches. The first half of the year was particularly strong due to
an exceptional cough and cold season and the contribution from
apixaban, an anticoagulant medication, in Europe.
Biosimilars overview
Net sales for the fourth quarter were USD 623 million, up 26% in
constant currencies, compared to the fourth quarter of 2022. This
strong double digit biosimilar growth reflects the launch of
Hyrimoz® high concentration formulation as well as
ongoing strong demand for our first ever biosimilar
Omnitrope®, where we are the market leader, capturing
34% market share2.
Net sales for the full year were USD 2.2 billion, up 15% in
constant currencies versus prior year, driven by strong
contributions from Omnitrope® and
Hyrimoz®.
Net sales by region
| |
Three months ended December 31 |
|
Change % |
|
Twelve months ended December 31 |
|
Change % |
| USD millions
unless indicated otherwise |
2023 |
2022 |
|
USD |
cc |
|
2023 |
2022 |
|
USD |
cc |
| Europe |
1 272 |
1 154 |
|
10 |
4 |
|
5 023 |
4 503 |
|
12 |
9 |
| North
America |
615 |
514 |
|
20 |
20 |
|
2 129 |
2 094 |
|
2 |
3 |
|
International |
656 |
628 |
|
4 |
14 |
|
2 495 |
2 472 |
|
1 |
9 |
|
Net sales to third parties |
2 543 |
2 296 |
|
11 |
10 |
|
9 647 |
9 069 |
|
6 |
7 |
Europe overview
Net sales for the fourth quarter were USD 1.3 billion, up 4% in
constant currencies, compared to the fourth quarter of 2022,
primarily due to solid generic volume growth and strong performance
of Omnitrope®.
Net sales for the full year were USD 5.0 billion, up 9% in
constant currencies versus prior year, driven by sales related to
an extraordinary cough and cold season and demand for new generic
launches such as apixaban in the first half of the year, and strong
performance of our biosimilars.
North America overview
Net sales for the fourth quarter were USD 615 million, up 20% in
constant currencies, compared to the fourth quarter of 2022. Growth
was driven by the transfer of mature brands from our former parent
and strong demand for Omnitrope®. In addition, we
started supplying Hyrimoz® to Cordavis, a wholly owned
subsidiary launched by CVS Health, during the quarter to sell under
their private label and to expand the reach of Hyrimoz®
to patients in the US.
Net sales for the full year were USD 2.1 billion, up 3% in
constant currencies versus prior year. North America moved from
stabilization to growth, driven primarily by strong demand for
Omnitrope®, the launch of Hyrimoz® in the US
and price erosion lower than in the prior year.
International overview
Net sales for the fourth quarter were USD 656 million, up 14% in
constant currencies, compared to the fourth quarter of 2022. This
was primarily a result of strong volume growth, new product
launches, such as Mycamine®, and strong demand for our
biosimilars.
Net sales for the full year were USD 2.5 billion, up 9% in
constant currencies versus prior year, driven by strong demand in
key markets and growth across the biosimilar portfolio.
FULL-YEAR KEY OPERATING RESULTS
| |
|
Twelve months ended December 31 |
|
Change % |
| USD millions
unless indicated otherwise |
|
2023 |
2022 |
|
USD |
cc |
| |
|
|
|
|
|
|
| Net sales to
third parties |
|
9 647 |
9 069 |
|
6 |
7 |
| Gross
profit |
|
4 564 |
4 378 |
|
4 |
8 |
| Operating
income |
|
375 |
1 239 |
|
(70) |
(53) |
| EBITDA |
|
914 |
1 741 |
|
(48) |
(37) |
|
|
|
|
|
|
|
|
| Core
results |
|
|
|
|
|
|
| Core gross
profit |
|
4 913 |
4 726 |
|
4 |
7 |
| % of net
sales to third parties |
|
50.9 |
52.1 |
|
|
|
|
|
|
|
|
|
|
|
| Core operating
income |
|
1 488 |
1 705 |
|
(13) |
(2) |
|
% of net sales to third parties |
|
15.4 |
18.8 |
|
|
|
| |
|
|
|
|
|
|
| Core
EBITDA |
|
1 743 |
1 931 |
|
(10) |
0 |
|
% of net sales to third parties |
|
18.1 |
21.3 |
|
|
|
| |
|
|
|
|
|
|
| Core net
financial result |
|
(251) |
(115) |
|
(118) |
(71) |
|
|
|
|
|
|
|
|
| Core income
taxes |
|
(284) |
(370) |
|
23 |
9 |
|
Core effective tax rate (%) |
|
23 |
23 |
|
|
|
| |
|
|
|
|
|
|
| Core net
income |
|
953 |
1 220 |
|
(22) |
(8) |
| Core diluted
earnings per share (USD) |
|
2.20 |
2.83 |
|
(22) |
(8) |
|
|
|
|
|
|
|
|
Core gross profit amounted to USD 4.9 billion compared to USD
4.7 billion in the prior year, resulting in a core gross profit
margin of 50.9% compared to 52.1% in 2022. The favorable
contribution from volume and product mix were offset by the impact
of higher input costs, and a 1.2 percentage point negative impact
from foreign exchange.
Core EBITDA was USD 1.7 billion versus 1.9 billion in the prior
year, resulting in a core EBITDA margin of 18.1% compared to 21.3%
in 2022. Contribution from higher sales were more than offset by
higher input costs as expected, investments in sales and marketing
to support our new product launches, standalone costs of 1.3
percentage points, and a 1.7 percentage point negative impact from
foreign exchange.
EBITDA was USD 914 million versus 1.7 billion in the prior year.
Core adjustments for EBITDA in 2023 were USD 829 million compared
to USD 190 million in 2022, driven by legal costs of USD 576
million, separation costs of USD 155 million and rationalization of
manufacturing sites and other of USD 98 million. Legal costs
included the settlement agreement with the class of direct
purchaser plaintiffs in the US multidistrict antitrust litigation
that was announced on February 29, 2024. As a new public company,
this settlement underscores our commitment to integrity and sound
governance and is an encouraging step toward putting allegations of
legacy conduct behind us.
Core net financial result was an expense of USD 251 million
compared to an expense of USD 115 million in 2022. The increase was
primarily a result of interest expenses related to financing from
our former parent prior to the spin-off, financing facilities put
in place at the separation and the bond issues in the fourth
quarter.
The core effective tax rate was 23%, in line with prior
year.
Core net income was USD 1.0 billion compared to USD 1.2 billion
in 2022 mainly driven by lower core EBITDA and higher interest
expense, partly offset by lower income tax. Core diluted earnings
per share was USD 2.20 with a weighted average number of shares of
431.2 million.
NET CASH FLOW, WORKING CAPITAL AND NET DEBT
Total cash and cash equivalents increased to USD 1.1 billion on
December 31, 2023, compared to USD 0.1 billion on December 31,
2022. The increase resulted from the opening cash at separation,
combined with the net proceeds from the fourth quarter bond issues
after refinancing of the bridge loan.
The company generated net cash flows from operating activities
of USD 0.4 billion, compared with USD 1.2 billion in the prior
year, driven primarily by an increase in net working capital,
separation costs, a legal settlement and manufacturing
optimization. The increase in net working capital was primarily due
to an increase in inventory of USD 0.6 billion to USD 2.7 billion,
with USD 0.2 billion supporting the strong topline growth of the
business, USD 0.2 billion from higher input costs and USD 0.2
billion due to the transfer of inventories from our former parent
at the separation and additional quantities to ensure operational
continuity post spin.
Net CAPEX was USD 586 million, compared with USD 386 million in
the prior year. This increase is mainly due to the acquisitions of
intangible assets such as Mycamine® and investments in
development and manufacturing sites in Germany and Slovenia.
Free cash flow amounted to a negative USD 234 million, compared
with USD 832 million in the prior year, due primarily to lower cash
flow from operating activities and higher net CAPEX.
Immediately prior to the separation and spin-off from its former
parent, Sandoz entered into a credit facility agreement. This
borrowing arrangement consisted of an unsecured bridge facility for
USD 2.6 billion, multiple term loans for USD 0.8 billion and a
revolving credit facility for USD 1.25 billion. The company
received investment grade credit ratings from Moody’s and S&P
of Baa2 and BBB, respectively, placing the company in a strong
position.
Post spin, the company successfully issued both CHF senior notes
of CHF 750 million and EUR senior notes of EUR 2.0 billion with
maturities ranging from 2026 to 2033. Proceeds were used to
refinance the bridge facility and for general corporate purposes.
As of December 31, 2023, Sandoz maturity profile is well balanced
with an average maturity of non-current financial debt of
approximately 5 years. As a result, the weighted average interest
rate on total non-current financial debt was 3.9% in
2023.
Net debt remained largely constant at USD 3.1 billion on
December 31, 2023, compared to USD 3.0 billion on December 31,
2022, corresponding to a net debt to core EBITDA ratio of 1.8x.
DIVIDEND
The Board of Directors is recommending a dividend of CHF 0.45 per
share representing 24% of core net income in line with our
guidance. Shareholders will vote on this proposal at the Annual
General Meeting on April 30, 2024.
GUIDANCE 2024
For full-year 2024, the company expects net sales to grow
mid-single digit in constant currencies versus prior year, and core
EBITDA margin around 20%.
MID-TERM GUIDANCE 2028
The company is reaffirming its mid-term guidance to 2028. The
company expects net sales to grow annually by mid-single digit in
constant currencies and core EBITDA margin in the range of 24% to
26%. Dividend is expected to be 30% to 40% of full-year core net
income.
ANNUAL REPORT
The company published its 2023 integrated Annual Report today,
which can be found at Integrated Annual Report.
KEY LINKS
Webcast – Live at 9am CET
Analyst Call Presentation
Analyst Consensus
CONTACTS
|
Global Media Relations contacts |
Investor Relations contacts |
Global.MediaRelations@sandoz.com
|
Investor.Relations@sandoz.com
|
Joerg
E. Allgaeuer
+49 171 838 4838 |
Karen M. King
+1 609 722 0982 |
Chris
Lewis
+49 174 244 9501 |
Laurent de Weck
+41 61 529 14 85 |
NON-IFRS MEASURES AS DEFINED BY SANDOZ
Sandoz uses certain non-IFRS metrics when measuring performance,
especially when measuring current period results against prior
periods, including core results, constant currencies and free cash
flow. Despite the use of these measures by management in setting
goals and measuring Sandoz performance, these are non-IFRS measures
that have no standardized meaning prescribed by IFRS Accounting
Standards. As a result, such measures have limits in their
usefulness to investors. Because of their non-standardized
definitions, the non-IFRS measures (unlike IFRS measures) may not
be comparable to the calculation of similar measures of other
companies. These non-IFRS measures are presented solely to permit
investors to more fully understand how Sandoz management assesses
underlying performance. These non-IFRS measures are not, and should
not be viewed as, a substitute for IFRS measures, and should be
viewed in conjunction with IFRS financials. As an internal measure
of Group performance, these non-IFRS measures have limitations, and
Sandoz performance management process is not solely restricted to
these metrics.
The definitions of the non-IFRS financial metrics as used by
Sandoz are as follows:
Core results
Sandoz core results – including core EBITDA, core operating income,
core net income and core earnings per share – exclude fully:
- The amortization and impairment charges of intangible assets
other than software;
- Net gains and losses on fund investments and equity securities
valued at fair value through profit and loss;
- Certain acquisition and divestment- related items;
- Tax liabilities for uncertain tax positions.
The following items that exceed a threshold of USD 25 million
are also excluded:
- Integration- and divestment- related income and expenses;
- Divestment gains and losses;
- Restructuring charges/releases and related items;
- Legal related items;
- Impairments of property, plant and equipment, software and
financial assets;
- And income and expense items that management deems exceptional
and that are or are expected to accumulate within the year to be
over a USD 25 million threshold. Income tax impacts of such items
are also excluded from core measures.
Sandoz believes that investor understanding of its performance
is enhanced by disclosing core measures of performance because,
since core measures exclude items that can vary significantly from
year to year, they enable a better comparison of business
performance across years. For this same reason, Sandoz uses these
core measures in addition to IFRS and other measures as important
factors in assessing its performance.
The following are examples of how these core measures are
utilized:
- In addition to monthly reports containing financial information
prepared under IFRS, senior management receives a monthly analysis
incorporating these core measures;
- Annual budgets are prepared for both IFRS and core
measures.
As an internal measure of Sandoz performance, the core results
measures have limitations, and the Sandoz performance management
process is not solely restricted to these metrics.
A limitation of the core results measures is that they provide a
view of the Sandoz operations without including all events during a
period, such as the effects of an acquisition, divestment, or
amortization/impairments of purchased intangible assets,
impairments to property, plant and equipment and restructurings and
related items.
Constant currencies
Changes in the relative values of non-US currencies to the US
dollar can affect Sandoz financial results and financial position.
To provide additional information that may be useful to investors,
including changes in sales volume, Sandoz presents information
about its net sales and various values relating to operating and
net income that are adjusted for such foreign currency effects.
Constant currency calculations have the goal of eliminating two
exchange rate effects so that an estimate can be made of underlying
changes in the consolidated income statement excluding the impact
of fluctuations in exchanges rates:
- The impact of translating the income statements of consolidated
entities from their non-USD functional currencies to USD;
- The impact of exchange rate movements on the major transactions
of consolidated entities performed in currencies other than their
functional currency.
Sandoz calculates constant currency measures by translating the
current year’s foreign currency values for sales and other income
statement items into USD (excluding the IAS 29 “Financial Reporting
in Hyperinflationary Economies” adjustments to the local currency
income statements of subsidiaries operating in hyperinflationary
economies), using the average exchange rates from the prior year
and comparing them to the prior year values in USD. Sandoz uses
these constant currency measures in evaluating its performance,
since they may assist the Group in evaluating its ongoing
performance from year to year. However, in performing its
evaluation, Sandoz also considers equivalent measures of
performance that are not affected by changes in the relative value
of currencies.
Growth rate calculation
For ease of understanding, Sandoz uses a sign convention for its
growth rates such that a reduction in operating expenses or losses
compared to the prior year is considered favorable and hence shown
as a positive change (growth).
Net financial result
Sandoz defines net financial result as interest expense and other
financial income and expense.
EBITDA
Sandoz defines earnings before interest, tax, depreciation, and
amortization (EBITDA) as operating income, excluding depreciation
of property, plant and equipment and right-of-use assets,
amortization of intangible assets, impairments of property, plant
and equipment, right-of-use assets, and intangible assets.
Core EBITDA margin
Sandoz defines core EBITDA margin as the percentage of core EBITDA
over net sales to third parties. It is an indicator to measure the
profitability of the Group.
Free cash flow
Sandoz defines free cash flow as net cash flows from operating
activities and cash flows from investing activities associated with
the purchase or sale of property, plant and equipment, of
intangible assets, of financial assets and of other non-current
assets. Excluded from free cash flow are cash flows from investing
activities associated with acquisitions and divestments of
businesses and of interests in associated companies, purchases and
sales of marketable securities, commodities, time deposits and net
cash flows from financing activities. Free cash flow is a non-IFRS
measure and is not intended to be a substitute measure for net cash
flows from operating activities as determined under IFRS. Free cash
flow is presented as additional information because management
believes it is a useful supplemental indicator of the Sandoz
ability to operate without reliance on additional borrowing or use
of existing cash. Free cash flow is a measure of the net cash
generated that is available for investment in strategic
opportunities, returning to shareholders and for debt repayment.
Free cash flow is a non-IFRS measure, which means it should not be
interpreted as a measure determined under IFRS.
Net working capital
Sandoz defines net working capital as inventory and trade
receivables, net of trade payables.
Net CAPEX
Sandoz defines net CAPEX as cash outflows from purchases of
property, plant and equipment and intangible assets, net of
proceeds from sale of property, plant and equipment and intangible
assets. Sandoz presents net CAPEX as a positive number.
Net debt
Sandoz defines net debt as non-current financial debt plus current
financial debts and derivative financial instruments, net of cash
and cash equivalents and marketable securities, commodities, time
deposits and derivative financial instruments. Net debt is
presented as additional information because it sets forth how
management monitors net debt or liquidity and management believes
it is a useful supplemental indicator of the Sandoz ability to pay
dividends, to meet financial commitments, and to invest in new
strategic opportunities, including strengthening its balance sheet.
For the table that shows Sandoz net debt, see “Note 32. Financial
instruments – additional disclosures” in the consolidated financial
statements of the Integrated Annual Report.
Currencies
References to “CHF” or “Swiss francs” are to the lawful currency of
Switzerland, references to “EUR” or “euro” are to the single
currency of the participating member states of the European Union
participating in the third stage of the economic and monetary union
pursuant to the Treaty on the Functioning of the European Union, as
amended or supplemented from time to time, references to “USD” or
“U.S. dollars” are to the lawful currency of the United States of
America, and reference to “JPY” or “yen” are to the lawful currency
of Japan.
Rounding
Certain figures contained in the press release, including financial
information presented in millions or thousands, certain operating
data and percentages describing financial information or market
shares, have been subject to rounding. Accordingly, in certain
instances, the amounts shown as totals in tables or elsewhere may
not conform exactly to the arithmetic total of the figures that
precede them. In addition, certain percentages reflect calculations
based upon the underlying information prior to rounding and,
accordingly, may not conform exactly to the percentages that would
be derived if the relevant calculations were based upon the rounded
numbers.
Financial year
Our financial year ends on December 31 of each calendar year. In
this press release, all references to “2023” are to the 12-month
period ended December 31, 2023, and all references to “2022” are to
the 12-month period ended December 31, 2022, unless the context
otherwise requires.
ABOUT SANDOZ
Sandoz (SIX: SDZ; OTCQX: SDZNY) is the global leader in generic and
biosimilar medicines, with a growth strategy driven by its Purpose:
pioneering access for patients. More than 20,000 people of more
than 100 nationalities work together to ensure 800 million patient
treatments are provided by Sandoz, generating substantial global
healthcare savings and an even larger social impact. Its leading
portfolio of approximately 1500 products addresses diseases from
the common cold to cancer. Headquartered in Basel, Switzerland,
Sandoz traces its heritage back to 1886. Its history of
breakthroughs includes Calcium Sandoz in 1929, the world’s first
oral penicillin in 1951, and the first biosimilar in 2006.
DISCLAIMER
This Media Release contains forward-looking statements, which offer
no guarantee with regard to future performance. These statements
are made on the basis of management’s views and assumptions
regarding future events and business performance at the time the
statements are made. They are subject to risks and uncertainties
including, but not confined to, future global economic conditions,
exchange rates, legal provisions, market conditions, activities by
competitors and other factors outside of the control of Sandoz.
Should one or more of these risks or uncertainties materialize or
should underlying assumptions prove incorrect, actual outcomes may
vary materially from those forecasted or expected. Each
forward-looking statement speaks only as of the date of the
particular statement, and Sandoz undertakes no obligation to
publicly update or revise any forward-looking statements, except as
required by law.
SUPPORTING FINANCIAL INFORMATION
Quarterly sales
FY 2023
| USD
millions unless indicated otherwise |
Q1 2023 |
|
Change % |
|
Q2 2023 |
|
Change % |
|
Q3 2023 |
|
Change % |
|
Q4 2023 |
|
Change % |
|
|
USD |
cc |
|
|
USD |
cc |
|
|
USD |
cc |
|
|
USD |
cc |
| Generics |
1
868 |
|
2 |
6 |
|
1
850 |
|
4 |
6 |
|
1
794 |
|
5 |
4 |
|
1
920 |
|
6 |
6 |
| Biosimilars |
516 |
|
11 |
17 |
|
533 |
|
13 |
14 |
|
543 |
|
7 |
4 |
|
623 |
|
29 |
26 |
|
Net sales to third parties |
2 384 |
|
4 |
9 |
|
2 383 |
|
5 |
8 |
|
2 337 |
|
6 |
4 |
|
2 543 |
|
11 |
10 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Europe |
1
270 |
|
10 |
16 |
|
1
277 |
|
14 |
12 |
|
1
204 |
|
11 |
3 |
|
1
272 |
|
10 |
4 |
| North America |
496 |
|
(5) |
(3) |
|
508 |
|
(4) |
(2) |
|
510 |
|
(4) |
(3) |
|
615 |
|
20 |
20 |
| International |
618 |
|
(1) |
4 |
|
598 |
|
(3) |
8 |
|
623 |
|
3 |
12 |
|
656 |
|
4 |
14 |
|
Net sales to third parties |
2 384 |
|
4 |
9 |
|
2 383 |
|
5 |
8 |
|
2 337 |
|
6 |
4 |
|
2 543 |
|
11 |
10 |
FY 2022
| USD
millions unless indicated otherwise |
Q1 2022 |
|
Change % |
|
Q2 2022 |
|
Change % |
|
Q3 2022 |
|
Change % |
|
Q4 2022 |
|
Change % |
|
|
USD |
cc |
|
|
USD |
cc |
|
|
USD |
cc |
|
|
USD |
cc |
| Generics |
1
834 |
|
3 |
9 |
|
1
787 |
|
(4) |
4 |
|
1
707 |
|
(9) |
1 |
|
1
813 |
|
(8) |
(1) |
| Biosimilars |
465 |
|
2 |
7 |
|
473 |
|
(2) |
8 |
|
507 |
|
3 |
15 |
|
483 |
|
(5) |
4 |
|
Net sales to third parties |
2 299 |
|
3 |
8 |
|
2 260 |
|
(4) |
4 |
|
2 214 |
|
(6) |
4 |
|
2 296 |
|
(8) |
0 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Europe |
1
151 |
|
2 |
9 |
|
1
118 |
|
(7) |
5 |
|
1
080 |
|
(11) |
5 |
|
1
154 |
|
(8) |
4 |
| North America |
521 |
|
0 |
0 |
|
528 |
|
(2) |
(1) |
|
531 |
|
0 |
1 |
|
514 |
|
(8) |
(6) |
| International |
627 |
|
6 |
14 |
|
614 |
|
2 |
9 |
|
603 |
|
(4) |
5 |
|
628 |
|
(7) |
(1) |
|
Net sales to third parties |
2 299 |
|
3 |
8 |
|
2 260 |
|
(4) |
4 |
|
2 214 |
|
(6) |
4 |
|
2 296 |
|
(8) |
0 |
Reconciliation of core results
Reconciliation from IFRS results to core
results
FY 2023
| USD millions
unless indicated otherwise |
IFRS results |
Amortization of intangible assets1 |
Impairments2 |
Other items3 |
Core results |
| Gross
profit |
4 564 |
222 |
34 |
93 |
4 913 |
|
Operating income4 |
375 |
222 |
43 |
848 |
1 488 |
| Income
before taxes |
130 |
222 |
43 |
842 |
1 237 |
| Income
taxes5 |
(50) |
|
|
|
(284) |
|
Net income |
80 |
|
|
|
953 |
| Basic earnings
per share (USD) |
0.18 |
|
|
|
2.21 |
| Diluted
earnings per share (USD) |
0.18 |
|
|
|
2.20 |
| |
|
|
|
|
|
| The
following are adjustments to arrive at core gross
profit |
. |
|
|
|
|
|
Cost of goods sold |
(5 415) |
222 |
34 |
93 |
(5 066) |
| |
|
|
|
|
|
| The
following are adjustments to arrive at core operating
income |
|
|
|
|
|
|
Selling, general and administration |
(2 389) |
– |
– |
29 |
(2 360) |
| Development
and regulatory |
(926) |
– |
10 |
1 |
(915) |
| Other
income |
94 |
– |
(1) |
(9) |
84 |
|
Other expense |
(968) |
– |
– |
734 |
(234) |
| |
|
|
|
|
|
| The
following are adjustments to arrive at core income before
taxes |
|
|
|
|
|
|
Other financial income and expense |
(43) |
– |
– |
(6) |
(49) |
| |
|
|
|
|
|
1 Amortization of intangible assets: cost of goods
sold includes the amortization of acquired rights to currently
marketed products and other production-related intangible
assets.
2 Impairments: cost of goods sold and development and
regulatory include impairment charges related to intangible assets;
other income includes a reversal of impairment charges related to
property, plant and equipment.
3 Other items: cost of goods sold, selling, general and
administration, other income and other expense include separation
costs related to the spin-off, the Group-wide rationalization of
manufacturing sites and other net restructuring charges and related
items; other expense also includes legal-related items; cost of
goods sold, selling, general and administration and development and
regulatory include adjustments to provisions and related items;
other financial income and expense includes the monetary loss on
the restatement of non-monetary items for subsidiaries in
hyperinflationary economies.
4 For further breakdown of core adjustments by category,
refer to table Reconciliation from IFRS operating income to core
net income.
5 Taxes on the adjustments between IFRS and core results
take into account, for each individual item included in the
adjustment, the tax rate that will finally be applicable to the
item based on the jurisdiction where the adjustment will finally
have a tax impact. Generally, this results in amortization and
impairment of intangible assets and acquisition-related
restructuring and integration items having a full tax impact. There
is usually a tax impact on other items, although this is not always
the case for items arising from legal settlements in certain
jurisdictions. Due to these factors and the differing applicable
tax rates in the various jurisdictions, the tax on the total
adjustments of USD 1.1 billion to arrive at the core results before
tax amounts to USD 234 million. The average tax rate on the
adjustments was 21%.
FY 2022
| USD millions
unless indicated otherwise |
IFRS results |
Amortization of intangible assets1 |
Impairments2 |
Other items3 |
Core results |
| Gross
profit |
4 378 |
221 |
35 |
92 |
4 726 |
|
Operating income4 |
1 239 |
221 |
33 |
212 |
1 705 |
| Income
before taxes |
1 102 |
221 |
33 |
234 |
1 590 |
| Income
taxes5 |
(252) |
|
|
|
(370) |
|
Net income |
850 |
|
|
|
1 220 |
| Basic earnings
per share (USD) |
1.97 |
|
|
|
2.83 |
| Diluted
earnings per share (USD) |
1.97 |
|
|
|
2.83 |
| |
|
|
|
|
|
| The
following are adjustments to arrive at core gross
profit |
. |
|
|
|
|
|
Cost of goods sold |
(4 928) |
221 |
35 |
92 |
(4 580) |
| |
|
|
|
|
|
| The
following are adjustments to arrive at core operating
income |
|
|
|
|
|
|
Selling, general and administration |
(2 127) |
– |
– |
10 |
(2 117) |
| Development
and regulatory |
(833) |
– |
1 |
1 |
(831) |
| Other
income |
111 |
– |
(2) |
(15) |
94 |
|
Other expense |
(290) |
– |
(1) |
124 |
(167) |
| |
|
|
|
|
|
| The
following are adjustments to arrive at core income before
taxes |
|
|
|
|
|
|
Other financial income and expense |
(48) |
– |
– |
22 |
(26) |
| |
|
|
|
|
|
1 Amortization of intangible assets: cost of goods
sold includes the amortization of acquired rights to currently
marketed products and other production-related intangible
assets.
2 Impairments: cost of goods sold and development and
regulatory include impairment charges related to intangible assets;
other income and other expense include reversals of impairment
charges and impairment charges related to property, plant and
equipment.
3 Other items: cost of goods sold, selling, general and
administration, development and regulatory, other income and other
expense include separation costs related to the spin-off, the
Group-wide rationalization of manufacturing sites and other net
restructuring charges and related items; other expense also
includes legal-related items; cost of goods sold and selling,
general and administration include adjustments to provisions and
related items; other financial income and expense includes the
monetary loss on the restatement of non-monetary items for
subsidiaries in hyperinflationary economies.
4 For further breakdown of core adjustments by category,
refer to table Reconciliation from IFRS operating income to core
net income.
5 Taxes on the adjustments between IFRS and core results
take into account, for each individual item included in the
adjustment, the tax rate that will finally be applicable to the
item based on the jurisdiction where the adjustment will finally
have a tax impact. Generally, this results in amortization and
impairment of intangible assets and acquisition-related
restructuring and integration items having a full tax impact. There
is usually a tax impact on other items, although this is not always
the case for items arising from legal settlements in certain
jurisdictions. Due to these factors and the differing applicable
tax rates in the various jurisdictions, the tax on the total
adjustments of USD 488 million to arrive at the core results before
tax amounts to USD 118 million. The average tax rate on the
adjustments was 24%.
Reconciliation from IFRS operating income to core
net income
| |
Twelve months ended December 31 |
| USD millions
unless indicated otherwise |
2023 |
2022 |
|
IFRS operating income |
375 |
1 239 |
|
Amortization of intangible assets |
222 |
221 |
|
Impairments |
|
|
|
Intangible assets |
44 |
35 |
|
Property, plant and equipment related to the Group-wide
rationalization of manufacturing sites |
(1) |
(2) |
|
Total impairment charges |
43 |
33 |
| Other
items |
|
|
|
Restructuring and related items |
|
|
|
- Income |
(8) |
(14) |
|
- Expense |
132 |
154 |
|
Legal-related items |
|
|
|
- Expense |
576 |
56 |
|
Separation costs |
155 |
16 |
|
Additional income |
(7) |
– |
|
Total other items |
848 |
212 |
|
Total adjustments |
1 113 |
466 |
|
Core operating income |
1 488 |
1 705 |
| % of net
sales to third parties |
15.4 |
18.8 |
| Net financial
result |
(245) |
(137) |
| Core
adjustments to net financial result |
(6) |
22 |
| Income taxes,
adjusted for above items (core income taxes) |
(284) |
(370) |
|
Core net income |
953 |
1 220 |
| |
|
|
Reconciliation from operating income to EBITDA to
core EBITDA
FY 2023
| USD
millions |
IFRS results |
Amortization of intangible assets |
Impairments |
Other items |
Core results |
|
Operating income |
375 |
222 |
43 |
848 |
1 488 |
| Depreciation
of property, plant and equipment |
189 |
– |
– |
(19) |
170 |
| Depreciation
of the right-of-use-assets |
49 |
– |
– |
– |
49 |
| Amortization
of intangible assets |
230 |
(208) |
– |
– |
22 |
| Intangible
assets directly expensed |
14 |
(14) |
– |
– |
– |
| Impairments of
property, plant and equipment, right-of-use assets and intangible
assets |
57 |
– |
(43) |
– |
14 |
|
EBITDA |
914 |
– |
– |
829 |
1 743 |
| |
|
|
|
|
|
FY 2022
| USD
millions |
IFRS results |
Amortization of intangible assets |
Impairments |
Other items |
Core results |
|
Operating income |
1 239 |
221 |
33 |
212 |
1 705 |
| Depreciation
of property, plant and equipment |
199 |
– |
– |
(22) |
177 |
| Depreciation
of the right-of-use-assets |
37 |
– |
– |
– |
37 |
| Amortization
of intangible assets |
222 |
(211) |
– |
– |
11 |
| Intangible
assets directly expensed |
10 |
(10) |
– |
– |
– |
| Impairments of
property, plant and equipment and intangible
assets1 |
34 |
– |
(33) |
– |
1 |
|
EBITDA |
1 741 |
– |
– |
190 |
1 931 |
| |
|
|
|
|
|
1 There were no impairments of right-of-use assets in
2022.
Reconciliation of free cash flow
| |
Twelve months ended December 31 |
| USD millions |
2023 |
2022 |
|
Operating income |
375 |
1 239 |
| Adjustments for
non-cash items |
|
|
|
Depreciation, amortization and impairments |
525 |
492 |
|
Change in provisions and other non-current liabilities |
639 |
99 |
|
Other |
15 |
(22) |
|
Operating income adjusted for non-cash items |
1 554 |
1 808 |
| Interest and
other financial receipts |
43 |
8 |
| Interest and
other financial payments |
(204) |
(119) |
| Income taxes
paid |
(245) |
(273) |
| Payments out of
provisions and other net cash movements in non-current
liabilities |
(123) |
(165) |
| Change in
inventory and trade receivables less trade payables |
(463) |
(325) |
| Change in other
net current assets and other operating cash flow items |
(200) |
289 |
|
Net cash flows from operating activities |
362 |
1 223 |
| Purchases of
property, plant and equipment |
(364) |
(278) |
| Proceeds from
sale of property, plant and equipment |
34 |
9 |
| Purchases of
intangible assets |
(261) |
(149) |
| Proceeds from
sale of intangible assets |
5 |
32 |
| Purchases of
financial assets |
(5) |
(6) |
| Proceeds from
sale of financial assets |
2 |
1 |
| Purchases of
other non-current assets |
(7) |
– |
|
Free cash flow |
(234) |
832 |
| |
|
|
Reconciliation of net working
capital
| |
December 31 |
| USD
millions |
2023 |
2022 |
|
Inventories |
2 700 |
2 124 |
| |
|
|
| Trade
receivable |
2 615 |
2 207 |
| Receivables
from former parent |
– |
91 |
|
Total trade receivables |
2 615 |
2 298 |
| |
|
|
| Trade
payables |
(1 593) |
(1 100) |
| Payables to
former parent |
– |
(257) |
|
Less total trade payables |
(1 593) |
(1 357) |
| |
|
|
|
Net working capital |
3 722 |
3 065 |
| |
|
|
Reconciliation of net CAPEX
| |
December 31 |
| USD
millions |
2023 |
2022 |
| Purchases of
property, plant and equipment |
364 |
278 |
| Purchases of
intangible assets |
261 |
149 |
|
Total purchases of property, plant and equipment and
intangible assets |
625 |
427 |
| |
|
|
| Proceeds from
sale of property, plant and equipment |
(34) |
(9) |
| Proceeds from
sale of intangible assets |
(5) |
(32) |
|
Less total proceeds from sale of property, plant and
equipment and intangible assets |
(39) |
(41) |
| |
|
|
|
Net CAPEX |
586 |
386 |
| |
|
|
Liquidity, financial debt and net
debt
| |
December 31 |
|
Change |
| USD millions
unless indicated otherwise |
2023 |
2022 |
|
USD |
| Non-current
financial debt |
3 975 |
30 |
|
3 945 |
| Other net
financial liabilities/receivables to/from former parent |
– |
2 839 |
|
(2 839) |
| Current
financial debts and derivative financial instruments |
284 |
185 |
|
99 |
|
Total financial debts |
4 259 |
3 054 |
|
1 205 |
| |
|
|
|
|
| Cash and cash
equivalents |
(1 109) |
(74) |
|
(1 035) |
| Derivative
financial instruments |
(35) |
– |
|
(35) |
|
Less total liquidity |
(1 144) |
(74) |
|
(1 070) |
| |
|
|
|
|
|
Net debt |
3 115 |
2 980 |
|
135 |
|
Net debt to core EBITDA ratio |
1.8x |
1.5x |
|
|
| |
|
|
|
|
1 Net sales in this document refer systematically
to net sales to third parties.
2 Based on IQVIA MIDAS Nov’23 rolling
12-month volume data, including originator products (once-daily
products only)
- 240313_Q4+Sales+&+FY+2023+Results+Media+Release.pdf
Sandoz (LSE:0SAN)
Graphique Historique de l'Action
De Déc 2024 à Jan 2025
Sandoz (LSE:0SAN)
Graphique Historique de l'Action
De Jan 2024 à Jan 2025
