- Fourth quarter 2014 revenues of $5.2
billion and full year revenues of $20.3 billion. Excluding the
impact of the divestment of the U.S. OTC plants and of foreign
exchange fluctuations, both fourth quarter and full year revenues
grew 2% organically.
- Fourth quarter 2014 non-GAAP operating
income of $1.5 billion, up 10% from the fourth quarter of 2013.
GAAP operating income of $0.9 billion, up 68%.
- Full year 2014 non-GAAP operating
income of $5.7 billion, up 10% from 2013. GAAP operating income of
$4.0 billion, up 140%.
- Fourth quarter 2014 non-GAAP operating
income margin of 28.9%, compared to 25.0% in the fourth quarter of
2013. Full year 2014 non-GAAP operating income margin of 28.3%
compared to 25.6% in 2013.
- Fourth quarter 2014 GAAP operating
income margin of 18.2%, compared to 10.3% in the fourth quarter of
2013. Full year 2014 GAAP operating income margin of 19.5% compared
to 8.1% in 2013.
- Fourth quarter 2014 non-GAAP diluted
EPS of $1.31, down 8% from the fourth quarter of 2013. GAAP diluted
EPS of $0.80, up 78%.
- Full year 2014 non-GAAP diluted EPS of
$5.07, up 1% compared to 2013. GAAP diluted EPS of $3.56, up
139%.
- Strong cash flow from operations of
$1.8 billion in the fourth quarter of 2014, an increase of 115%
compared to the fourth quarter of 2013. Cash flow from operations
for the year of $5.1 billion, compared to $3.2 billion in
2013.
- $0.5 billion of share repurchases in
the fourth quarter of 2014; 10% increase in quarterly dividend, to
NIS 1.33 per share.
- Full year 2015 guidance
reaffirmed.
Teva Pharmaceutical Industries Ltd. (NYSE:TEVA) today reported
results for the quarter and the year ended December 31, 2014.
“In order to take a great leap forward you must first create a
solid foundation from which to drive sustainable profitable growth.
2014 was that year for Teva, where we established a stable
underlying base from which we will grow in the coming years. We
reenergized our business around our core capabilities and growth
engines – regaining our leading position in generics; narrowing the
focus on core therapeutic areas in specialty; managing the
lifecycle of key products; and significantly improving our
operating profitability and cash-flow generation,” stated Erez
Vigodman, CEO of Teva. “Looking forward, we will create the most
competitive operational network in terms of efficiency, scale and
capability and are prioritizing the commercial activities in our
markets to ensure leadership and profitability. There is great
promise in our specialty and generic pipelines with significant
output expected already this year. We will take bold steps forward,
both organic and inorganic, to position Teva for sustainable,
profitable growth, create value for all of our stakeholders and
deliver long-term shareholder return.”
Eyal Desheh, Chief Financial Officer of Teva, stated “Throughout
the year, Teva placed great emphasis on the optimization of our
global portfolio and the ongoing cost containment efforts, which
resulted in an overall improvement in our non-GAAP operating margin
of approximately 400 basis points. These efforts contributed to the
strong financial results in 2014, which included achieving or
exceeding the key metrics of our financial guidance. Teva generated
an all-time high cash flow from operations, despite currency
headwinds that impacted our annual operating profit by more than
$120 million, as well as the expected increase in tax expense. We
used a portion of these funds to resume our share repurchase
program, purchasing $500 million of our stock in the fourth quarter
and paying out more than $1.1 billion in dividends during 2014. We
have a strong balance sheet with more than $2.6 billion in cash,
about $10 billion in debt and a debt-to-EBITDA ratio of 1.67.”
Results for the Fourth Quarter of
2014
Generic Medicines Segment
Generic Medicines Three Months Ended December
31, 2014 2013 U.S.$ in millions / % of
Segment Revenues Revenues $ 2,469 100.0% $ 2,680
100.0% Gross profit 1,081 43.8% 1,155 43.1% R&D expenses 133
5.4% 141 5.3% S&M expenses 387 15.7% 500 18.7% Segment profit*
$ 561 22.7% $ 514 19.2%
*
Segment profit consists of gross profit,
less R&D and S&M expenses related to the segment. Segment
profit does not include G&A expenses, amortization and certain
other items.
The data presented have been conformed to reflect the revised
classification of certain of our products for all periods.
Generic Medicines Revenues
Generic medicines revenues in the fourth quarter of 2014
amounted to $2.5 billion, a decrease of 8%, or 3% in local currency
terms, compared to the fourth quarter of 2013.
Generic revenues consisted of:
- U.S. revenues of $1.2 billion, flat
compared to the fourth quarter of 2013, as higher sales of
omega-3-acid ethyl esters (the generic equivalent of Lovaza®),
capecitabine (the generic equivalent of Xeloda®), celecoxib (the
generic equivalent of Celebrex®), raloxifene (the generic
equivalent of Evista®) and entecavir (the generic equivalent of
Baraclude®) were offset by lower revenues of products launched
during 2013, mainly niacin ER (the generic equivalent of Niaspan®),
following the loss of exclusivity.
- European revenues of $759 million, a
decrease of 16%, or 9% in local currency terms, compared to the
fourth quarter of 2013. The decrease resulted mainly from our
strategy of pursuing profitable and sustainable business in the
region, with lower revenues in Germany, France and Spain partially
offset by higher revenues in certain other markets. This strategy
has led to notable improvements in the profitability of our
European generics business.
- ROW revenues of $532 million, a
decrease of 12%, but an increase of 1% in local currency terms,
compared to the fourth quarter of 2013. The increase in local
currency terms was mainly due to higher revenues in Russia and in
Latin America, which were largely offset by lower revenues in Japan
and Canada.
- API sales to third parties of $178
million (which is included in the market revenues above), an
increase of 2%, or 5% in local currency terms, compared to the
fourth quarter of 2013.
Generic medicines revenues comprised 48% of our total revenues
in the quarter, down from 49% in the fourth quarter of 2013.
Generic Medicines Gross Profit
Gross profit from our generic medicines segment in the fourth
quarter of 2014 amounted to $1.1 billion, a decrease of 6%,
compared to the fourth quarter of 2013. The lower gross profit was
mainly the result of lower revenues, partially offset by higher
profitability of products launched in 2014 and of our European
portfolio, improved pricing and higher gross profit of our APIs.
Gross profit margin for our generic medicines segment in the fourth
quarter of 2014 increased to 43.8%, from 43.1% in the fourth
quarter of 2013.
Generic Medicines Profit
Profit from our generic medicines segment amounted to $561
million in the fourth quarter of 2014, an increase of 9% compared
to $514 million in the fourth quarter of 2013. The increase was
primarily due to our lower S&M expenses and lower R&D
expenses, partially offset by lower gross profit. Generic medicines
profit as a percentage of generic medicines revenues was 22.7% in
the fourth quarter of 2014, up from 19.2% in the fourth quarter of
2013.
Specialty Medicines Segment
Specialty Medicines Three Months Ended December
31, 2014 2013 U.S.$ in millions / % of
Segment Revenues Revenues $ 2,243 100.0% $ 2,214
100.0% Gross profit 1,956 87.2% 1,928 87.1% R&D expenses 217
9.7% 253 11.4% S&M expenses 545 24.3% 516 23.3% Segment profit*
$ 1,194 53.2% $ 1,159 52.3%
* Segment profit consists of gross profit, less R&D and S&M
expenses related to the segment. Segment profit does not include
G&A expenses, amortization and certain other items. The data
presented have been conformed to reflect the revised classification
of certain of our products for all periods.
Specialty Medicines Revenues
Specialty medicines revenues in the fourth quarter of 2014
amounted to $2.2 billion, an increase of 1%, or 5% in local
currency terms, compared to the fourth quarter of 2013. U.S.
specialty medicines revenues amounted to $1.6 billion, up 6%
compared to the fourth quarter of 2013. European specialty
medicines revenues amounted to $448 million, a decrease of 11%, or
3% in local currency terms, compared to the fourth quarter of 2013.
ROW specialty medicines revenues amounted to $167 million, down 2%,
but up 23% in local currency terms, compared to the fourth quarter
of 2013.
Specialty medicines revenues comprised 43% of our total revenues
in the quarter, compared to 41% in the fourth quarter of 2013.
The increase in local currency terms of specialty medicines
revenues compared to the fourth quarter of 2013 was primarily due
to higher sales of our oncology and CNS products, which were
partially offset by lower revenues of women’s health products.
The following table presents revenues by therapeutic area and
key products for our specialty medicines segment for the three
months ended December 31, 2014 and 2013:
Three Months Ended December
31,
PercentageChange
2014 2013 2014 - 2013 U.S. $ in
millions CNS $ 1,451 $ 1,463 (1%) Copaxone® 1,121 1,142
(2%) Azilect® 108 98 10% Nuvigil® 105 76 38%
Oncology 335
269 25% Treanda® 226 177 28%
Respiratory 252 254 (1%)
ProAir® 120 114 5% Qvar® 77 89 (13%)
Women's Health 115 134
(14%)
Other Specialty 90 94 (4%)
Total
Specialty Medicines $ 2,243 $ 2,214
1%
The data presented have been conformed to reflect the revised
classification of certain of our products for all periods.
Global sales of Copaxone® (20 mg/mL and 40 mg/mL),
the leading multiple sclerosis therapy in the U.S. and globally,
amounted to $1.1 billion, a decrease of 2%, but an increase of 3%
in local currency terms, compared to the fourth quarter of
2013.
In the United States, sales of Copaxone® amounted to $835
million, up 4% compared to the fourth quarter of 2013. At the end
of the fourth quarter of 2014, according to December 2014 IMS data,
our U.S. market shares for the Copaxone® products in terms of new
and total prescriptions were 25.9% and 31.5%, respectively.
Copaxone® 40 mg/mL accounted for over 60% of total Copaxone®
prescriptions.
Sales outside the United States amounted to $286 million, a
decrease of 15%, but flat in local currency terms, compared to the
fourth quarter of 2013, as higher sales in Russia, due to the
timing of a tender in Russia, were offset by lower revenues in
other markets.
Our global Azilect® revenues amounted to $108 million, an
increase of 10% compared to the fourth quarter of 2013, while
global in-market revenues increased 6% to $141 million. The
increase in our sales reflects volume growth and a price increase
in the United States, as well as volume growth in Europe.
Sales of our oncology products amounted to $335 million
in the fourth quarter of 2014, an increase of 25% compared to the
fourth quarter of 2013. The increase resulted primarily from higher
sales of Treanda®, as well as of our recently launched G-CSF
products, Lonquex® and Granix®. Sales of Treanda® amounted
to $226 million in the fourth quarter of 2014, compared to $177
million in the fourth quarter of 2013, following the launch of the
new liquid formulation of the product in November 2014.
Sales of our respiratory products amounted to $252
million in the fourth quarter of 2014, a decrease of 1% compared to
the fourth quarter of 2013. ProAir® revenues amounted
to $120 million in the fourth quarter of 2014, up 5% compared to
the fourth quarter of 2013, mainly due to volume growth which was
partially offset by pricing variances. Qvar® revenues
amounted to $77 million in the fourth quarter of 2014, a decrease
of 13% compared to the fourth quarter of 2013, due to pricing
variances.
Specialty Medicines Gross Profit
Gross profit from our specialty medicines segment amounted to
$2.0 billion in the fourth quarter of 2014, up 1% compared to the
fourth quarter of 2013.
Gross profit margin for our specialty medicines segment in the
fourth quarter of 2014 was 87.2%, compared to 87.1% in the fourth
quarter of 2013.
Specialty Medicines Profit
Profit of our specialty medicines segment amounted to $1.2
billion in the fourth quarter of 2014, an increase of 3% compared
to the fourth quarter of 2013, due to lower R&D expenses and
higher gross profit, which were partially offset by higher S&M
expenses in connection with new product launches.
Specialty medicines profit as a percentage of segment revenues
was 53.2% in the fourth quarter of 2014, up from 52.3% in the
fourth quarter of 2013.
The following tables present details of our multiple sclerosis
franchise and of our other specialty medicines for the three months
ended December 31, 2014 and 2013:
Multiple Sclerosis Three months ended
December 31, 2014 2013 U.S.$ in
millions / % of MS Revenues Revenues $ 1,121 100.0% $
1,142 100.0% Gross profit 1,002 89.4% 1,017 89.1% R&D expenses
32 2.9% 22 1.9% S&M expenses 125 11.2% 147 12.9%
MS profit $ 845 75.4% $ 848 74.3%
Other Specialty
Medicines Three months ended December 31, 2014
2013 U.S.$ in millions / % of Other Specialty
Revenues Revenues $ 1,122 100.0% $ 1,072 100.0% Gross
profit 954 85.0% 911 85.0% R&D expenses 185 16.5% 231 21.5%
S&M expenses 420 37.4% 369 34.4% Other Specialty
profit $ 349 31.1% $ 311 29.0%
The data presented have been conformed to reflect the revised
classification of certain of our products for all periods.
Other Activities
Our OTC revenues related to PGT in the fourth quarter of
2014 amounted to $227 million, compared to $246 million in the
fourth quarter of 2013. In local currency terms, revenues grew 9%.
The increase in local currency terms was mainly due to higher sales
in Russia and Latin America, partially offset by lower sales in
Europe.
PGT’s in-market sales amounted to $372 million in the fourth
quarter of 2014, a decrease of $35 million compared to the fourth
quarter of 2013. In local currency terms, revenues grew 3%. The
increase in local currency terms was mainly due to higher sales in
Latin America and Asia.
Our revenues from OTC products in the fourth quarter of 2014
amounted to $228 million, a decrease of 28% or 15% in local
currency terms. The decline was mainly due to the sale of our U.S.
OTC plants, previously purchased from P&G, back to P&G in
July 2014.
Other revenues amounted to $228 million in the fourth
quarter of 2014, mostly from the distribution of third-party
products in Israel and Hungary, up 4% compared to the fourth
quarter of 2013.
Key Metrics for the Fourth Quarter
2014
Non-GAAP information: Net non-GAAP adjustments in the
fourth quarter of 2014 amounted to $438 million. Non-GAAP net
income and non-GAAP EPS for the quarter are adjusted to exclude the
following items:
- Amortization of purchased intangible
assets totaling $253 million, of which $244 million is included in
cost of goods sold and the remaining $9 million in selling and
marketing expenses;
- Impairment of long lived assets of $179
million;
- Restructuring and other expenses of
$110 million;
- Regulatory actions taken in facilities
of $30 million;
- Costs associated with cancellation of
R&D projects of $27 million;
- Income in connection with legal
settlements and loss contingencies of $44 million; and
- Related tax benefit of $117
million.
Teva believes that excluding such items facilitates investors'
understanding of its business. See the attached tables for a
reconciliation of the U.S. GAAP results to the adjusted non-GAAP
figures.
Exchange rate differences between the fourth quarter of
2014 and the fourth quarter of 2013 decreased our revenues by
$277 million and reduced our non-GAAP operating income by $55
million. Our GAAP operating income was reduced by $41 million.
Non-GAAP gross profit was $3.2 billion in the fourth
quarter of 2014, down 1% from the fourth quarter of 2013. Non-GAAP
gross profit margin was 61.2% in the fourth quarter of 2014,
compared to 58.9% in the fourth quarter of 2013. GAAP gross profit
was $2.9 billion in the fourth quarter of 2014, flat compared to
the fourth quarter of 2013. GAAP gross profit margin was 55.9% in
the quarter, compared to 53.3% in the fourth quarter of 2013.
Research and Development (R&D) expenditures
(excluding costs associated with cancellation of R&D projects
and purchase of in-process R&D) in the fourth quarter of 2014
amounted to $352 million, compared to $409 million, in the fourth
quarter of 2013. R&D expenses were 6.8% of revenues in the
quarter, compared to 7.5% in the fourth quarter of 2013. R&D
expenses related to our generic medicines segment amounted to $133
million in the fourth quarter of 2014, a decrease of 6% compared to
$141 million in the fourth quarter of 2013. R&D expenses
related to our specialty medicines segment amounted to $217 million
in the fourth quarter of 2014, down 14% compared to $253 million in
the fourth quarter of 2013, mainly as a result of lower expenses in
our non-core therapeutic areas and timing of expenses related to
our respiratory pipeline.
Selling and Marketing (S&M) expenditures (excluding
amortization of purchased intangible assets) amounted to $997
million, or 19.3% of revenues, in the fourth quarter of 2014,
compared to $1.1 billion, or 20.6% of revenues, in the fourth
quarter of 2013. S&M expenses related to our generic medicines
segment amounted to $387 million in the fourth quarter of 2014, a
decrease of 23% compared to $500 million in the fourth quarter of
2013, mainly due to lower royalty payments in the United States and
to lower expenses in Europe and Russia. This decrease reflects our
ongoing cost reduction efforts. S&M expenses related to our
specialty medicines segment amounted to $545 million, an increase
of 6% compared to $516 million in the fourth quarter of 2013. The
increase was primarily due to higher expenditures related to our
launches of DuoResp Spiromax®, Lonquex®, Granix® and Adasuve®, as
well as preparation for additional product launches planned for
2015.
General and Administrative (G&A) expenditures
amounted to $320 million in the fourth quarter of 2014, or 6.2% of
revenues, compared with $316 million, or 5.8% of revenues, in the
fourth quarter of 2013.
Quarterly non-GAAP operating income was $1.5 billion in
the fourth quarter of 2014, an increase of 10% compared to the
fourth quarter of 2013. Quarterly GAAP operating income was $942
million in the fourth quarter of 2014, compared to $560 million in
the fourth quarter of 2013.
Non-GAAP financial expenses amounted to $69 million in
the fourth quarter of 2014, compared to $55 million in the fourth
quarter of 2013. GAAP financial expenses for the fourth quarter of
2014 amounted to $70 million, compared to $59 million in the fourth
quarter of 2013.
The provision for non-GAAP tax for the fourth
quarter of 2014 amounted to $303 million on pre-tax non-GAAP income
of $1.4 billion, for a quarterly tax rate of 21%. The provision for
non-GAAP tax in the fourth quarter of 2013 was $91 million on
non-GAAP pre-tax income of $1.3 billion, or 7%. GAAP tax
expenses for the fourth quarter of 2014 amounted to $186 million on
pre-tax income of $872 million, for a quarterly GAAP tax rate of
21%. In the fourth quarter of 2013, tax expenses amounted to $114
million on pre-tax income of $501 million for a quarterly GAAP tax
rate of 23%.
The increase in our non-GAAP quarterly tax rate mainly reflects
the lapse, in 2013, of our tax exemptions under the previous
Israeli tax incentives regime. Our profits in Israel are now
generally subject to a tax rate of 9%.
Non-GAAP net income and non-GAAP diluted EPS were $1.1
billion and $1.31, respectively, in the fourth quarter of 2014, a
decrease of 7% and 8%, respectively, compared to the fourth quarter
of 2013. GAAP net income and GAAP diluted EPS were
$687 million and $0.80, respectively, in the fourth quarter of
2014, up 81% and 78%, respectively, compared to $380 million and
$0.45, in the fourth quarter of 2013.
Cash flow from operations generated during the fourth
quarter of 2014 amounted to $1.8 billion, compared to $0.8 billion
in the fourth quarter of 2013. The increase was mainly due to lower
payments related to legal settlements. Free cash flow, excluding
net capital expenditures amounted to $1.5 billion, compared to $0.5
billion in the fourth quarter of 2013.
Cash and investments at December 31, 2014 amounted to
$2.6 billion.
For the fourth quarter of 2014, the weighted average
outstanding shares for the fully diluted earnings per share
calculation was 861 million on both a GAAP and non-GAAP basis. At
December 31, 2014, the outstanding shares for calculating Teva's
market capitalization were approximately 852 million.
Shareholders’ equity was $23.4 billion at December 31,
2014, compared to $23.7 billion at September 30, 2014. The decrease
primarily reflects a negative impact of $0.6 billion due to
currency fluctuations, share repurchases of $0.5 billion and
dividend payments of $0.3 billion, partially offset by GAAP net
income of $0.7 billion, proceeds from exercise of options of $0.2
billion and $0.1 billion of unrealized gains (net) from derivative
financial instruments.
Key Metrics for Full Year
2014
Non-GAAP information: Net non-GAAP adjustments for 2014
amounted to $1.3 billion. Non-GAAP net income and non-GAAP EPS for
the year are adjusted to exclude the following items:
- Amortization of purchased intangible
assets totaling $1,036 million;
- Impairment of long lived assets of $387
million;
- Restructuring expenses and other
expenses of $282 million;
- Costs associated with cancellation of
R&D projects of $79 million;
- Regulatory actions taken in facilities
of $75 million;
- Branded prescription drug fee of $40
million;
- Income in connection with legal
settlements and loss contingencies of $111 million; and
- Related tax benefit of $492
million.
Teva believes that excluding such items facilitates investors'
understanding of its business. See the attached tables for a
reconciliation of the U.S. GAAP results to the adjusted non-GAAP
figures.
Exchange rate differences between 2014 and 2013 decreased
our revenues by $346 million and reduced our non-GAAP
operating income by $123 million. Our GAAP operating income was
reduced by $114 million.
Non-GAAP gross profit of 2014 was $12.1 billion, up 2%
from 2013. Non-GAAP gross profit margin was 59.9%, compared
to 58.6% in 2013. GAAP gross profit of 2014 was $11.1 billion, up
3% compared to 2013. 2014 GAAP gross profit margin was 54.5%,
compared to 52.7% in 2013.
Research and Development (R&D) expenditures
(excluding costs associated with cancellation of R&D projects
and purchase of in-process R&D) in 2014 amounted to $1.4
billion, a decrease of 1% compared to 2013. R&D expenses were
7.0% of revenues in both years.
Selling and Marketing (S&M) expenditures (excluding
amortization of purchased intangible assets and branded
prescription drug fee) amounted to $3.8 billion, or 18.7% of
revenues, in 2014, compared to $4.0 billion, or 19.9% of revenues,
in 2013.
General and Administrative (G&A) expenditures
amounted to $1.2 billion, down $22 million compared to 2013,
comprising 6.0% of revenues in 2014, compared to 6.1% in 2013.
Non-GAAP operating income in 2014 was $5.7 billion, an
increase of 10% compared to 2013. GAAP operating income was $4.0
billion in 2014, compared to $1.6 billion in 2013.
Non-GAAP financial expenses in 2014 amounted to $306
million, compared to $289 million in 2013. GAAP financial expenses
for 2014 amounted to $313 million, compared to $399 million in
2013.
The provision for non-GAAP taxes for 2014 amounted to
$1.1 billion on pre-tax non-GAAP income of $5.4 billion. The
provision for non-GAAP taxes in 2013 was $630 million on pre-tax
income of $4.9 billion. The non-GAAP tax rate for 2014 was 20%, as
compared to 13% in 2013. GAAP tax expenses in 2014 amounted
to $591 million, or 16% of pre-tax income of $3.6 billion. In 2013,
we booked a tax benefit in the amount of $43 million, on pre-tax
income of $1.3 billion.
2014 Non-GAAP net income and non-GAAP diluted EPS were
$4.4 billion and $5.07, respectively, up 2% and 1%, respectively,
compared to 2013. 2014 GAAP net income and GAAP diluted
EPS were $3.1 billion and $3.56, compared to $1.3 billion and
$1.49 in 2013.
Cash flow from operations generated during 2014 amounted
to $5.1 billion, compared to $3.2 billion in 2013. Free cash flow,
excluding net capital expenditures amounted to $4.3 billion,
compared to $2.3 billion in 2013.
The weighted average outstanding shares for the fully
diluted earnings per share calculation for 2014 was 858 million on
both a GAAP and non-GAAP basis.
Dividend
The Board of Directors, at its meeting on February 3, 2015,
declared a cash dividend for the fourth quarter of 2014 of NIS 1.33
per share (approximately 34 cents according to the rate of exchange
on February 3, 2015).
The record date will be February 19, 2015, and the payment date
will be March 3, 2015. Tax will be withheld at a rate of 15%.
Commencing in April 2015, our dividends will be declared and
paid in U.S. dollars.
Annual Report on Form
20-F
Teva will file its Annual Report on Form 20-F with the SEC next
week. The report will be available on the company’s website,
http://www.tevapharm.com, as well as through the SEC’s website:
http://www.sec.gov.
Conference Call
Teva will host a conference call and live webcast to discuss its
results for the fourth quarter and full year 2014 and overall
business environment on Thursday, February 5, 2015, at 8:00 a.m.
EST. A Question & Answer session will follow this
discussion.
In order to participate, please dial the following numbers (at
least 10 minutes before the scheduled start time): United States
1-866-434-1115; Canada 1-866-992-3607 International +44(0)
1452-589509; Israel 1-809-441425; passcode: 66308620.
A live webcast of the call will also be available on Teva's
website at: http://ir.tevapharm.com. Please log in at least 10
minutes prior to the conference call in order to download the
applicable audio software.
Following the conclusion of the call, a replay of the webcast
will be available within 24 hours on the Company's website. The
replay can also be accessed until March 12, 2015, 10:00 a.m. ET by
calling United States 1-866-247-4222; Canada 1-866-878-9237 or
International +44(0) 1452 550000; passcode: 66308620.
About Teva
Teva Pharmaceutical Industries Ltd. (NYSE and TASE: TEVA) is a
leading global pharmaceutical company that delivers high-quality,
patient-centric healthcare solutions to millions of patients every
day. Headquartered in Israel, Teva is the world’s largest generic
medicines producer, leveraging its portfolio of more than 1,000
molecules to produce a wide range of generic products in nearly
every therapeutic area. In specialty medicines, Teva has a
world-leading position in innovative treatments for disorders of
the central nervous system, including pain, as well as a strong
portfolio of respiratory products. Teva integrates its generics and
specialty capabilities in its global research and development
division to create new ways of addressing unmet patient needs by
combining drug development capabilities with devices, services and
technologies. Teva's net revenues in 2014 amounted to $20.3
billion. For more information, visit www.tevapharm.com.
Teva's Safe Harbor Statement under the U. S. Private
Securities Litigation Reform Act of 1995:
This release contains forward-looking statements, which are
based on management’s current beliefs and expectations and involve
a number of known and unknown risks and uncertainties that could
cause our future results, performance or achievements to differ
significantly from the results, performance or achievements
expressed or implied by such forward-looking statements. Important
factors that could cause or contribute to such differences include
risks relating to: our ability to develop and commercialize
additional pharmaceutical products; competition for our innovative
products, especially Copaxone® (including competition from
orally-administered alternatives, as well as from potential
purported generic equivalents) and our ability to migrate users to
our new 40 mg/mL version; the possibility of material fines,
penalties and other sanctions and other adverse consequences
arising out of our ongoing FCPA investigations and related matters;
our ability to achieve expected results from the research and
development efforts invested in our pipeline of specialty and other
products; our ability to reduce operating expenses to the extent
and during the timeframe intended by our cost reduction program;
our ability to identify and successfully bid for suitable
acquisition targets or licensing opportunities, or to consummate
and integrate acquisitions; the extent to which any manufacturing
or quality control problems damage our reputation for quality
production and require costly remediation; increased government
scrutiny in both the U.S. and Europe of our patent settlement
agreements; our exposure to currency fluctuations and restrictions
as well as credit risks; the effectiveness of our patents,
confidentiality agreements and other measures to protect the
intellectual property rights of our specialty medicines; the
effects of reforms in healthcare regulation and pharmaceutical
pricing, reimbursement and coverage; governmental investigations
into sales and marketing practices, particularly for our specialty
pharmaceutical products; adverse effects of political or economic
instability, major hostilities or acts of terrorism on our
significant worldwide operations; interruptions in our supply chain
or problems with internal or third-party information technology
systems that adversely affect our complex manufacturing processes;
significant disruptions of our information technology systems or
breaches of our data security; competition for our generic
products, both from other pharmaceutical companies and as a result
of increased governmental pricing pressures; competition for our
specialty pharmaceutical businesses from companies with greater
resources and capabilities; the impact of continuing consolidation
of our distributors and customers; decreased opportunities to
obtain U.S. market exclusivity for significant new generic
products; potential liability in the U.S., Europe and other markets
for sales of generic products prior to a final resolution of
outstanding patent litigation; our potential exposure to product
liability claims that are not covered by insurance; any failure to
recruit or retain key personnel, or to attract additional executive
and managerial talent; any failures to comply with complex Medicare
and Medicaid reporting and payment obligations; significant
impairment charges relating to intangible assets, goodwill and
property, plant and equipment; the effects of increased leverage
and our resulting reliance on access to the capital markets;
potentially significant increases in tax liabilities; the effect on
our overall effective tax rate of the termination or expiration of
governmental programs or tax benefits, or of a change in our
business; variations in patent laws that may adversely affect our
ability to manufacture our products in the most efficient manner;
environmental risks; and other factors that are discussed in our
Annual Report on Form 20-F for the year ended December 31, 2014 and
in our other filings with the U.S. Securities and Exchange
Commission. Forward-looking statements speak only as of the date on
which they are made and we assume no obligation to update or revise
any forward-looking statement, whether as a result of new
information, future events or otherwise.
Consolidated
Statements of Income
(U.S. dollars in
millions, except share and per share data)
Three months ended Year ended
December 31, December 31, 2014
2013 2014 2013 Unaudited
Unaudited
Audited Audited Net revenues 5,168 5,430
20,272 20,314
Cost of sales 2,279 2,536 9,216 9,607
Gross
profit 2,889 2,894 11,056 10,707
Research and development
expenses 379 411 1,488 1,427
Selling and marketing
expenses 1,006 1,132 3,861 4,080
General and administrative
expenses 320 316 1,217 1,239
Impairments, restructuring and
others 286 460 650 788
Legal settlements and loss
contingencies (44) 15 (111) 1,524
Operating income 942
560 3,951 1,649
Financial expenses – net 70 59 313 399
Income before income taxes 872 501 3,638 1,250
Income
taxes 186 114 591 (43)
Share in (income) loss of associated
companies – net (8) 10 5 40
Net income 694 377 3,042
1,253
Net income (loss) attributable to non-controlling
interests 7 (3) (13) (16)
Net income attributable to
Teva 687 380 3,055 1,269
Earnings per share
attributable to Teva: Basic ($) 0.80 0.45 3.58 1.49
Diluted ($) 0.80 0.45 3.56 1.49
Weighted average number
of shares (in millions): Basic 854 847 853 849
Diluted 861 848 858 850
Non-GAAP net income attributable to Teva:* 1,125
1,205 4,351 4,255
Non-GAAP earnings per share
attributable to Teva:* Basic ($) 1.32 1.42 5.10 5.01
Diluted ($) 1.31 1.42 5.07 5.01
Weighted average
number of shares (in millions): Basic 854 847 853 849
Diluted 861 848 858 850
* See
reconciliation attached.
Condensed
Consolidated Balance Sheets
(U.S. dollars in
millions)
(Audited)
December 31, 2014 2013 ASSETS
Current assets: Cash and cash equivalents 2,226 1,038
Accounts receivable 5,408 5,338 Inventories 4,371 5,053 Deferred
income taxes 993 1,084 Other current assets 1,398 1,207
Total
current assets 14,396 13,720
Other non-current assets
1,569 1,696
Property, plant and equipment, net 6,535 6,635
Identifiable intangible assets, net 5,512 6,476
Goodwill 18,408 18,981
Total assets 46,420 47,508
LIABILITIES AND EQUITY Current
liabilities: Short-term debt 1,761 1,804 Sales reserves and
allowances 5,849 4,918 Accounts payable and accruals 3,171 3,317
Other current liabilities 1,508 1,926
Total current
liabilities 12,289 11,965
Long-term liabilities:
Deferred income taxes 1,101 1,247 Other taxes and long-term
liabilities 1,109 1,273 Senior notes and loans 8,566 10,387
Total long-term liabilities 10,776 12,907
Equity:
Teva shareholders’ equity 23,313 22,565 Non-controlling interests
42 71
Total equity 23,355 22,636
Total liabilities and
equity 46,420 47,508
Condensed
Consolidated Cash Flow
(U.S. Dollars in
millions)
Three months ended
Year ended
December 31,
December 31,
2014 2013 2014 2013 Unaudited
Unaudited Audited Audited Operating
activities: Net income 694 377 3,042 1,253
Net change
in operating assets and liabilities 507 359 290 968
Items
not involving cash flow 551 80 1,795 1,016
Net cash provided by operating activities 1,752 816
5,127 3,237
Net cash used in investing activities
(347) (316) (1,450) (1,147)
Net cash used in financing
activities (593) (619) (2,375) (3,883)
Translation
adjustment on cash and cash equivalents (59) 9 (114) (48)
Net change in cash and cash
equivalents 753 (110) 1,188 (1,841)
Balance of cash
and cash equivalents at beginning of period 1,473 1,148 1,038
2,879
Balance of cash and cash
equivalents at end of period 2,226 1,038 2,226 1,038
Non GAAP
reconciliation items
(U.S. Dollars in
millions)
Three months ended Year ended December
31,
December 31, 2014 2013 2014 2013
Unaudited Unaudited Audited Audited
Amortization of purchased intangible assets - under cost of
sales 244 298 1,000 1,136
Impairment of long-lived assets
179 329 387 524
Restructuring and other expenses 107 131 263
264
Legal settlements and loss contingencies (44) 15 (111)
1,524
Costs related to regulatory actions taken in
facilities - under cost of sales 30 5 75 43
Costs associated
with cancellation of R&D projects 27 - 79 -
Amortization
of purchased intangible assets - under selling and marketing
expenses 9 15 36 44
Accelerated depreciation 2 3 12 9
Financial expense 1 4 7 110
Branded prescription drug
fee - - 40 -
Purchase of research and development in
process - 2 - 5
Corresponding tax effect (117) 23 (492)
(673)
Reconciliation
between Net Income attributable to Teva and Earnings per
share
as reported under
US GAAP to Non-GAAP Net Income attributable to Teva and Earnings
per share
Year ended December 31, 2014 Year ended December 31,
2013 Audited, U.S. dollars and shares in millions (except
per share amounts) GAAP
Non-GAAPAdjustments
Non-GAAP
% of NetRevenues
GAAP
Non-GAAPAdjustments
Non-GAAP
% of NetRevenues
Gross profit (1) 11,056 1,087 12,143 59.9% 10,707 1,188
11,895 58.6% Operating income (1)(2) 3,951 1,781 5,732 28.3% 1,649
3,549 5,198 25.6%
Net income attributable to Teva
(1)(2)(3)
3,055 1,296 4,351 21.5% 1,269 2,986 4,255 20.9% Earnings per share
attributable to Teva - diluted (4) 3.56 1.51 5.07 1.49 3.52 5.01
(1) Amortization of purchased intangible
assets 1,000 1,136 Costs related to regulatory actions taken in
facilities 75 43 Accelerated depreciation 12 9 Gross profit
adjustments 1,087 1,188 (2) Legal settlements and loss
contingencies (111) 1,524 Impairment of long-lived assets 387 524
Restructuring and other expenses 382 269 Amortization of purchased
intangible assets 36 44 694 2,361 Operating income
adjustments 1,781 3,549 (3) Tax effect and other items (492)
(673) Financial expense 7 110 Net income adjustments
1,296 2,986 (4)
The weighted average number of shares was
858 and 850 million for the year ended December 31, 2014 and 2013,
respectively. Non-GAAP earnings per share can be reconciled with
GAAP earnings per share by dividing each of the amounts included in
footnotes 1-3 above by the applicable weighted average share
number.
Reconciliation
between Net Income attributable to Teva and Earnings per
share
as reported under
US GAAP to Non-GAAP Net Income attributable to Teva and Earnings
per share
Three months ended December 31, 2014 Three months
ended December 31, 2013 Unaudited, U.S. dollars and shares
in millions (except per share amounts) GAAP
Non-GAAPAdjustments
Non-GAAP
% of NetRevenues
GAAP
Non-GAAPAdjustments
Non-GAAP
% of NetRevenues
Gross profit (1) 2,889 276 3,165 61.2% 2,894 306 3,200 58.9%
Operating income (1)(2) 942 554 1,496 28.9% 560 798 1,358 25.0% Net
income attributable to Teva (1)(2)(3) 687 438 1,125 21.8% 380 825
1,205 22.2% Earnings per share attributable to Teva - Diluted (4)
0.80 0.51 1.31 0.45 0.97 1.42 (1) Amortization
of purchased intangible assets 244 298 Costs related to regulatory
actions taken in facilities 30 5 Accelerated deprecation 2 3 Gross
profit adjustments 276 306 (2) Impairment of long-lived
assets 179 329 Restructuring and other expenses 134 133
Amortization of purchased intangible assets 9 15 Legal settlements
and loss contingencies (44) 15 278 492 Operating
profit adjustments 554 798 (3) Tax effect and other items
(117) 23 Financial expense 1 4 Net income adjustments 438 825
(4) The weighted average number of shares was 861 and 848
million for the three months ended December 31, 2014 and 2013,
respectively. Non-GAAP earnings per share can be reconciled with
GAAP earnings per share by dividing each of the amounts included in
footnotes 1-3 above by the applicable weighted average share
number.
Segment
Information
Generic Medicines
Three months ended December 31,
Percentage Change
2014 2013 2014 - 2013 Unaudited, U.S.$ in
millions / % of Segment Revenues Revenues 2,469 100.0% 2,680
100.0% (8%) Gross Profit 1,081 43.8% 1,155 43.1% (6%) R&D
Expenses 133 5.4% 141 5.3% (6%) S&M Expenses 387 15.7% 500
18.7% (23%) Segment Profit* 561 22.7% 514 19.2% 9%
Specialty Medicines Three months ended December 31,
Percentage Change
2014 2013 2014 - 2013 Unaudited, U.S.$ in
millions / % of Segment Revenues Revenues 2,243 100.0% 2,214
100.0% 1% Gross Profit 1,956 87.2% 1,928 87.1% 1% R&D Expenses
217 9.7% 253 11.4% (14%) S&M Expenses 545 24.3% 516 23.3% 6%
Segment Profit* 1,194 53.2% 1,159 52.3% 3%
* Segment profit consists of gross profit, less S&M and R&D
expenses related to the segment. Segment profit does not include
G&A expenses, amortization and certain other items. The data
presented has been conformed to reflect the revised classification
of certain of our products for all periods.
Segment
Information
Generic Medicines Year
ended December 31, Percentage Change 2014
2013 2014 - 2013 Audited, U.S.$ in millions / % of
Segment Revenues Revenues 9,814 100.0% 9,902 100.0% (1%)
Gross Profit 4,247 43.3% 4,079 41.2% 4% R&D Expenses 517 5.3%
492 5.0% 5% S&M Expenses 1,582 16.1% 1,919 19.4% (18%) Segment
Profit* 2,148 21.9% 1,668 16.8% 29%
Specialty
Medicines Year ended December 31, Percentage
Change 2014 2013 2014 - 2013 Audited,
U.S.$ in millions / % of Segment Revenues Revenues 8,560
100.0% 8,388 100.0% 2% Gross Profit 7,457 87.1% 7,274 86.7% 3%
R&D Expenses 881 10.3% 883 10.5% § S&M Expenses 2,001 23.4%
1,864 22.2% 7% Segment Profit* 4,575 53.4% 4,527 54.0% 1% *
Segment profit consists of gross profit, less S&M and R&D
expenses related to the segment. Segment profit does not include
G&A expenses, amortization and certain other items. The data
presented has been conformed to reflect the revised classification
of certain of our products for all periods. § Less than 0.5%.
Additional
information Multiple Sclerosis Three months
ended December 31, Percentage Change 2014
2013 2014 - 2013 Unaudited, U.S.$ in millions / %
of MS Revenues Revenues 1,121 100.0% 1,142 100.0% (2%)
Gross profit 1,002 89.4% 1,017 89.1% (1%) R&D expenses 32 2.9%
22 1.9% 45% S&M expenses 125 11.2% 147 12.9% (15%) MS profit
845 75.4% 848 74.3% §
Other Specialty Three
months ended December 31, Percentage Change 2014
2013 2014 - 2013 Unaudited, U.S.$ in millions / %
of Other Specialty Revenues Revenues 1,122 100.0% 1,072
100.0% 5% Gross profit 954 85.0% 911 85.0% 5% R&D expenses 185
16.5% 231 21.5% (20%) S&M expenses 420 37.4% 369 34.4% 14%
Other Specialty profit 349 31.1% 311 29.0% 12% The data
presented has been conformed to reflect the revised classification
of certain of our products for all periods. § Less than 0.5%.
Additional information
Multiple Sclerosis Year ended December 31,
Percentage Change 2014 2013 2014 - 2013
Audited, U.S.$ in millions / % of MS Revenues
Revenues $ 4,237 100.0% $ 4,328 100.0% (2%) Gross profit 3,794
89.5% 3,867 89.3% (2%) R&D expenses 97 2.3% 81 1.9% 20% S&M
expenses 514 12.1% 514 11.9% § MS profit 3,183 75.1% 3,272 75.6%
(3%)
Other Specialty Year ended December
31, Percentage Change 2014 2013 2014 -
2013 Audited, U.S.$ in millions / % of Other Specialty
Revenues Revenues $ 4,323 100.0% $ 4,060 100.0% 6% Gross
profit 3,663 84.7% 3,407 83.9% 8% R&D expenses 784 18.1% 802
19.8% (2%) S&M expenses 1,487 34.4% 1,350 33.3% 10% Other
Specialty profit 1,392 32.2% 1,255 30.9% 11% The data
presented has been conformed to reflect the revised classification
of certain of our products for all periods. § Less than 0.5%.
Reconciliation of our segment profit to
consolidated income before income taxes Three
months ended December 31, 2014 2013
Unaudited, U.S.$ in millions Generic medicine profit
561 514 Specialty medicine profit 1,194 1,159 Total segment profit
1,755 1,673 Profit of other activities 61 1 Total profit 1,816
1,674 Amounts not allocated to segments: Amortization 253 313
General and administrative expenses 320 316 Impairments,
restructuring and others 286 460 Legal settlements and loss
contingencies (44) 15 Other unallocated amounts 59 10
Consolidated operating income 942 560 Financial expenses - net 70
59 Consolidated income before income taxes 872 501
Reconciliation of our segment profit to consolidated
income before income taxes Year ended December
31, 2014 2013 Audited, U.S.$ in
millions Generic medicines profit 2,148 1,668 Specialty
medicines profit 4,575 4,527 Total segment profit 6,723 6,195
Profit of other activities 226 242 Total profit 6,949 6,437 Amounts
not allocated to segments: Amortization 1,036 1,180 General and
administrative expenses 1,217 1,239 Impairments, restructuring and
others 650 788 Legal settlements and loss contingencies (111) 1,524
Other unallocated amounts 206 57 Consolidated
operating income 3,951 1,649 Financial expenses - net 313 399
Consolidated income before income taxes 3,638 1,250
Revenues by Activity and
Geographical Area (Unaudited)
Three Months Ended December
31,
PercentageChange
PercentageChange
2014 2013 2014 - 2013 2014 - 2013
U.S. $ in millions
in localcurrencies
Generic Medicine United States $ 1,178 $ 1,175 § § Europe* 759 902
(16%) (9%) Rest of the World 532 603 (12%) 1% Total
Generic Medicine 2,469 2,680 (8%) (3%) Specialty Medicine United
States 1,628 1,540 6% 6% Europe* 448 503 (11%) (3%) Rest of the
World 167 171 (2%) 23% Total Specialty Medicine 2,243
2,214 1% 5% Other Revenues United States 2 72 (97%) (97%) Europe*
180 194 (7%) 3% Rest of the World 274 270 1% 17%
Total Other Revenues 456 536 (15%) (4%) Total
Revenues $ 5,168 $ 5,430 (5%) § * All members of the
European Union, Switzerland, Norway, Albania and the countries of
former Yugoslavia. The data presented has been conformed to reflect
the revised classification of certain of our products for all
periods. § Less than 0.5%.
Revenues by Activity
and Geographical Area (Audited)
Year Ended December 31,
PercentageChange
PercentageChange
2014 2013 2014 - 2013 2014 -
2013
U.S. $ in millions
in localcurrencies
Generic Medicines United States $ 4,418 $ 4,172 6% 6% Europe* 3,148
3,362 (6%) (7%) Rest of the World 2,248 2,368 (5%) 4%
Total Generic Medicines 9,814 9,902 (1%) 1% Specialty Medicines
United States 6,110 6,025 1% 1% Europe* 1,898 1,854 2% 2% Rest of
the World 552 509 8% 23% Total Specialty 8,560 8,388
2% 3% Other Revenues United States 106 264 (60%) (60%) Europe* 777
772 1% 2% Rest of the World 1,015 988 3% 9%
Total Other Revenues 1,898 2,024 (6%) (3%) Total
Revenues $ 20,272 $ 20,314 § 1% * All members of the
European Union, Switzerland, Norway, Albania and the countries of
former Yugoslavia. The data presented has been conformed to reflect
the revised classification of certain of our products for all
periods.
§ Less than 0.5%.
Revenues by Product line (Unaudited)
Three Months Ended December
31,
PercentageChange
2014 2013 2014 - 2013 U.S. $ in
millions Generic Medicine $ 2,469
$ 2,680 (8%) API 178 175 2%
Specialty
Medicine 2,243 2,214 1% CNS 1,451 1,463
(1%) Copaxone® 1,121 1,142 (2%) Azilect® 108 98 10% Nuvigil® 105 76
38% Oncology 335 269 25% Treanda® 226 177 28% Respiratory 252 254
(1%) ProAir® 120 114 5% Qvar® 77 89 (13%) Women's Health 115 134
(14%) Other Specialty 90 94 (4%)
All Others 456
536 (15%) OTC 228 316 (28%) Other Revenues 228
220 4%
Total $ 5,168 $
5,430 (5%)
The data presented has been conformed to
reflect the revised classification of certain of our products for
all periods.
Revenues by Product line (Audited)
Year Ended December31,
PercentageChange
2014 2013 2014 - 2013 U.S. $ in
millions Generic Medicines $ 9,814
$ 9,902 (1%) API 724 727 §
Specialty
Medicines 8,560 8,388 2% CNS 5,575 5,545
1% Copaxone® 4,237 4,328 (2%) Azilect® 428 371 15% Nuvigil® 388 320
21% Oncology 1,180 1,005 17% Treanda® 767 709 8% Respiratory 957
964 (1%) ProAir® 478 429 11% Qvar® 286 328 (13%) Women's Health 504
510 (1%) Other Specialty 344 364 (5%)
All Others
1,898 2,024 (6%) OTC 996 1,165 (15%) Other
Revenues 902 859 5%
Total $
20,272 $ 20,314 §
The data presented has been conformed to
reflect the revised classification of certain of our products for
all periods.
§ Less than 0.5%.
Teva Pharmaceutical Industries Ltd.IR Contacts:Kevin C. Mannix,
United States, 215-591-8912Ran Meir, United States,
215-591-3033Tomer Amitai, Israel, 972 (3) 926-7656orPR
Contacts:Iris Beck Codner, Israel, 972 (3) 926-7246Denise Bradley,
United States, 215-591-8974
Teva Pharmaceutical Indu... (NYSE:TEVA)
Graphique Historique de l'Action
De Juin 2024 à Juil 2024
Teva Pharmaceutical Indu... (NYSE:TEVA)
Graphique Historique de l'Action
De Juil 2023 à Juil 2024