Teva Pharmaceutical Industries Ltd. (NYSE and TASE: TEVA) today
reported results for the year and the quarter ended December 31,
2021.
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the full release here:
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- Q4 2021 and FY 2021 highlights:
Q4
2021
FY
2021
Revenues
$4.1 billion
$15.9 billion
GAAP diluted EPS
$(0.14)
$0.38
Non-GAAP diluted EPS
$0.77
$2.58
Cash flow generated from
operating activities
$456 million
$798 million
Free cash flow
$716 million
$2,196 million
- 2022 business outlook:
- Revenues are expected to be $15.6 - $16.2 billion
- Non-GAAP diluted EPS is expected to be $2.40 - $2.60
- Free cash flow is expected to be $1.9 - $2.2 billion
"In 2021 Teva delivered solid results, generating strong cash
flow and improving our profitability. While COVID-19 continued to
impact patient behavior and global prescribing patterns, we
continued to optimize our supply chain and manufacturing
capabilities to provide essential medicines to the millions of
patients who rely on us throughout the world. We improved our gross
and operating margin and reduced our net debt, keeping us on our
path to achieve our 2023 long-term goals", said Mr. Kåre Schultz,
Teva’s President and CEO.
Mr. Schultz continued: "Looking forward to 2022, we expect to
see continued growth of our key products AUSTEDO® and AJOVY®, as
well as to continue to advance our core business through the launch
of high quality generic medicines around the world. We are also
excited about the expected FDA approval and launch of Risperidone
LAI, an important treatment for patients suffering from
schizophrenia.
Regarding the recently announced settlement in the
opioid-related litigation in Texas, Mr. Schultz stated, "I'm very
pleased with the agreement we reached with the state of Texas, the
second most populous state in the U.S. Not only does it mark a
further step in resolving our legacy opioids litigations more
broadly, but importantly also makes critical medicines part of the
solution when addressing the opioids epidemic. While the agreement
includes no admission of wrongdoing, it remains in our best
interest to put these cases behind us and continue to focus on the
patients we serve every day.”
2021 Annual Consolidated Results
Revenues in 2021 were $15,878 million, a decrease of 5%,
in U.S. dollars or 6% in local currency terms, compared to 2020,
mainly due to lower revenues from COPAXONE®, generic products in
the U.S., generic products in Japan resulting from the divestment
of a majority of the generic and operational assets of our Japanese
business venture and Anda, partially offset by higher revenues from
AUSTEDO and AJOVY. Revenues continued to be affected by the ongoing
impact of the COVID-19 pandemic on markets and on customer stocking
and purchasing patterns.
Exchange rate movements during 2021, including hedging
effects, positively impacted revenues by $232 million, GAAP
operating income by $49 million and non-GAAP operating income by
$55 million, each as compared to 2021.
GAAP gross profit was $7,594 million in 2021, a decrease
of 2% compared to 2020. GAAP gross profit margin was 47.8%
in 2021, compared to 46.4% in 2020. Non-GAAP gross profit
was $8,612 million in 2021, a decrease of 1% compared to 2020.
Non-GAAP gross profit margin was 54.2% in 2021, compared to
52.4% in 2020. This increase in both GAAP and non-GAAP gross profit
as a percentage of revenues was mainly due to higher profitability
in North America, resulting from higher revenues from AUSTEDO and
AJOVY and a favorable mix of generic products, as well as higher
profitability in Europe and International Markets, partially offset
by lower revenues from COPAXONE due to generic competition.
GAAP Research and Development (R&D) expenses
in 2021 were $967 million, a decrease of 3% compared to 2020.
Non-GAAP R&D expenses in 2021 were $933 million, or 5.9%
of revenues, compared to $941 million, or 5.6% of revenues, in
2020. The decrease in non-GAAP R&D expenses in 2021, compared
to 2020, was mainly due to a decrease in the pain and
neuropsychiatry therapeutic areas, partially offset by higher
R&D expenses related to generic products including
biosimilars.
GAAP Selling and Marketing (S&M) expenses in
2021 were $2,429 million, a decrease of 3% compared to 2020.
Non-GAAP S&M expenses were $2,297 million, or 14.5% of
revenues, in 2021, compared to $2,322 million, or 13.9% of
revenues, in 2020.
GAAP General and Administrative (G&A) expenses in
2021 were $1,099 million, a decrease of 6% compared to 2020.
Non-GAAP G&A expenses were $1,029 million in 2021, or
6.5% of revenues, compared to $1,115 million, or 6.7% of revenues,
in 2020.
GAAP other income in 2021 was $98 million, compared to
$40 million in 2020. Non-GAAP other income in 2021 was $48
million, compared to $31 million in 2020.
GAAP operating income was $1,716 million in 2021,
compared to an operating loss of $3,572 million in 2020. GAAP
operating loss in 2020 was mainly affected by goodwill impairment
charges and intangible asset impairments. Non-GAAP operating
income was $4,401 million in 2021, or 27.7% of revenues
compared to $4,388 million, or 26.3% of revenues in 2020.
EBITDA (defined as operating income, excluding
amortization and depreciation expenses) was $3,046 million in 2021,
compared to negative EBITDA of $2,007 million in 2020. Adjusted
EBITDA (defined as non-GAAP operating income excluding
depreciation expenses) was $4,911 million in 2021, compared to
$4,912 million in 2020.
In 2021, GAAP financial expenses were $1,058 million,
compared to $834 million in 2020. Non-GAAP financial
expenses were $930 million in 2021, compared to $918 million in
2020.
In 2021, we recognized a GAAP tax expense of $211
million, or 32%, on a pre-tax income of $658 million. In 2020, we
recognized a tax benefit of $168 million, or 4%, on a pre-tax loss
of $4,406 million. Our tax rate for 2020 was lower than in 2021
mainly due to a goodwill impairment charge that did not have a
corresponding tax effect. Non-GAAP income taxes for 2021 were $570
million on non-GAAP pre-tax income of $3,471 million. Non-GAAP
income taxes in 2020 were $577 million on non-GAAP pre-tax
income of $3,470 million. The non-GAAP tax rate for 2021 was 16.4%,
similar to 16.6% in 2020.
GAAP net income attributable to Teva and GAAP diluted
earnings per share in 2021 were $417 million and $0.38,
respectively, compared to net loss of $3,990 million and diluted
loss per share of $3.64 in 2020. Non-GAAP net income
attributable to Teva and non-GAAP diluted earnings per share
in 2021 were $2,855 million and $2.58, respectively, compared to
$2,830 million and $2.57 in 2020.
The weighted average diluted shares outstanding used for
the fully diluted share calculation on a GAAP basis for 2021 and
2020 were 1,107 million and 1,095 million shares, respectively. The
weighted average diluted outstanding shares used for
the fully diluted earnings per share calculation on a non-GAAP
basis for 2021 and 2020 were 1,107 million and 1,099 million
shares, respectively.
As of December 31, 2021 and 2020, the fully diluted share
count for purposes of calculating our market capitalization was
approximately 1,128 million and 1,117 million shares,
respectively.
Non-GAAP information: Net non-GAAP adjustments in 2021
were $2,438 million. Non-GAAP net income and non-GAAP EPS for the
year were adjusted to exclude the following items:
- Amortization of purchased intangible assets totaling $802
million, of which $702 million is included in cost of goods sold
and the remaining $99 million in S&M expenses;
- Legal settlements and loss contingencies of $717 million;
- $584 million impairment of long-lived assets comprised mainly
of impairments of identifiable intangible assets totaling $424
million ($297 million of product rights and trade names and $127
million of in process R&D assets) and tangible assets
impairments in our Europe and North America segments;
- Restructuring expenses of $133 million;
- Financial expenses of $128 million, mainly related to
revaluation of marketable securities;
- Equity compensation expenses of $118 million;
- Costs related to regulatory actions taken in facilities of $23
million;
- Purchase of in process R&D of $15 million;
- Contingent consideration expense of $7 million;
- Divested gain in amount of $51 million;
- Other non-GAAP items of $337 million;
- Minority interest adjustment of $15 million; and
- Related tax effect of $360 million.
Teva believes that excluding such items facilitates investors’
understanding of its business. For further information, see below
the U.S. GAAP to adjusted non-GAAP reconciliation tables under
“Financial Tables” and the information under “Non-GAAP Financial
Measures.” Investors should consider non-GAAP financial measures in
addition to, and not as replacement for, or superior to, measures
of financial performance prepared in accordance with GAAP.
Cash flow generated from operating activities in 2021 was
$798 million, compared to $1,216 million in 2020. This decrease was
mainly due to lower profit in our North America segment during
2021.
Free cash flow (cash flow generated from operating
activities, net of cash used for capital investments and beneficial
interest collected in exchange for securitized trade receivables)
was $2,196 million in 2021, compared to $2,110 million in 2020. The
increase in 2021 resulted mainly from higher cash generated from
divestitures of businesses and other assets, partially offset by
lower cash flow generated from operating activities.
As of December 31, 2021, our debt was $23,043 million,
compared to $25,919 million as of December 31, 2020. This decrease
was mainly due to $4,008 million repurchased upon consummation of a
cash tender offer, $3,167 million senior notes repaid at maturity
and $710 million of exchange rate fluctuations, partially offset by
$4,973 million of issued sustainability-linked senior notes net of
issuance costs. The portion of total debt classified as short-term
as of December 31, 2021 was 6%, compared to 12% as of December 31,
2020, due to a repayment of debt, partially offset by a
reclassification of upcoming maturities in 2022. Our average debt
maturity was approximately 6.4 years as of December 31, 2021,
compared to 5.8 years as of December 31, 2020.
Fourth Quarter 2021 Consolidated Results
Revenues in the fourth quarter of 2021 were $4,100
million, a decrease of 8% in both U.S. dollars and local currency
terms compared to the fourth quarter of 2020, mainly due to lower
revenues from generic products in North America and COPAXONE,
partially offset by higher revenues from AUSTEDO and AJOVY.
Revenues continued to be affected by the ongoing impact of the
COVID-19 pandemic on markets and on customer stocking and
purchasing patterns.
Exchange rate differences between the fourth quarter of
2021 and the fourth quarter of 2020, net of hedging effects
negatively impacted revenues by $19 million and positively impacted
our GAAP operating income by $15 million. Our non-GAAP operating
income was positively impacted by $12 million.
GAAP gross profit was $2,050 million in the fourth
quarter of 2021, flat compared to the fourth quarter of 2020. GAAP
gross profit margin was 50% in the fourth quarter of 2021,
compared to 46% in the fourth quarter of 2020. Non-GAAP gross
profit was $2,301 million in the fourth quarter of 2021, a
decrease of 1% compared to the fourth quarter of 2020. Non-GAAP
gross profit margin was 56.1% in the fourth quarter of 2021,
compared to 52.3% in the fourth quarter of 2020. The increase in
non-GAAP gross profit margin in the fourth quarter of 2021 resulted
mainly from higher revenues from AUSTEDO and AJOVY, higher gross
profit margin in our Europe and International Markets segments,
partially offset by lower revenues from COPAXONE in North America
due to generic competition.
GAAP Research and Development (R&D) expenses
in the fourth quarter of 2021 were $244 million, a decrease of 17%
compared to the fourth quarter of 2020. Non-GAAP R&D
expenses were $229 million, or 5.6% of quarterly revenues, in
the fourth quarter of 2021, compared to $254 million, or 5.7% of
quarterly revenues, in the fourth quarter of 2020. The decrease in
R&D expenses in the fourth quarter of 2021 was mainly due to a
decrease in the pain and neuropsychiatry therapeutic areas,
partially offset by higher R&D expenses related to generic
products including biosimilars.
GAAP Selling and Marketing (S&M) expenses in
the fourth quarter of 2021 were $632 million, a decrease of 7%
compared to the fourth quarter of 2020. Non-GAAP S&M
expenses were $600 million, or 14.6% of quarterly revenues in
the fourth quarter of 2021, compared to $627 million, or 14.1% of
quarterly revenues in the fourth quarter of 2020.
GAAP General and Administrative (G&A) expenses in the
fourth quarter of 2021 were $276 million, a decrease of 15%
compared to the fourth quarter of 2020. Non-GAAP G&A
expenses were $244 million, or 6% of quarterly revenues in the
fourth quarter of 2021, compared to $312 million, or 7% of
quarterly revenues in the fourth quarter of 2020.
GAAP other income in the fourth quarter of 2021 was $26
million, compared to $10 million in the fourth quarter of 2020.
Non-GAAP other income in the fourth quarter of 2021 was $19
million, compared to $5 million in the fourth quarter of 2020.
GAAP operating income in the fourth quarter of 2021 was
$78 million, compared to $406 million in the fourth quarter of
2020. This decrease was mainly due to higher legal settlements and
loss contingencies in the fourth quarter of 2021. Non-GAAP
operating income in the fourth quarter of 2021 was $1,248
million, an increase of 9% compared to the fourth quarter of
2020.
EBITDA (defined as operating income, excluding
amortization and depreciation expenses) was $397 million in the
fourth quarter of 2021, compared to EBITDA of $808 million in the
fourth quarter of 2020. Adjusted EBITDA (defined as non-GAAP
operating income excluding depreciation expenses) was $1,373
million in the fourth of 2021, an increase of 8%, compared to
$1,277 million in the fourth quarter of 2020.
GAAP financial expenses for the fourth quarter of 2021
were $253 million, compared to $268 million in the fourth quarter
of 2020. Non-GAAP financial expenses were $229 million in the
fourth quarter of 2021, compared to $235 million in the fourth
quarter of 2020. Financial expenses in the fourth quarter of 2021
and 2020, were mainly comprised of interest expenses of $225
million and $224 million, respectively.
In the fourth quarter of 2021, we recognized a GAAP tax
benefit of $24 million on a pre-tax GAAP loss of $175 million.
In the fourth quarter of 2020, we recognized a GAAP tax benefit of
$22 million on pre-tax GAAP income of $138 million. Non-GAAP
income taxes for the fourth quarter of 2021 were $153
million, or 15%, on pre-tax non-GAAP income of $1,019 million.
Non-GAAP income taxes in the fourth quarter of 2020 were $141
million, or 16%, on pre-tax non-GAAP income of $905 million.
GAAP net loss attributable to Teva and GAAP diluted
loss per share in the fourth quarter of 2021 were $159 million
and $0.14, respectively, compared to GAAP net income attributable
to Teva and GAAP diluted earnings per share of $150 million and
$0.14, respectively, in the fourth quarter of 2020. Non-GAAP net
income attributable to Teva and non-GAAP diluted earnings
per share in the fourth quarter of 2021 were $854 million and
$0.77, respectively, compared to $753 million and $0.68,
respectively, in the fourth quarter of 2020.
The weighted average diluted shares outstanding
used for the fully diluted share calculation for the three months
ended December 31, 2021 and 2020 was 1,103 million shares and 1,100
million shares, respectively. The weighted average diluted
shares outstanding used for the fully diluted share calculation
on a non-GAAP basis for the three months ended December 31, 2021
and 2020 was 1,108 million and 1,100 million shares,
respectively.
Non-GAAP information: Net non-GAAP adjustments in the
fourth quarter of 2021 were $1,012 million. Non-GAAP net income and
non-GAAP EPS for the fourth quarter were adjusted to exclude the
following items:
- Legal settlements and loss contingencies of $604 million;
- Amortization of purchased intangible assets of $188 million, of
which $165 million is included in cost of sales and the remaining
$24 million in S&M expenses;
- $183 million impairment of long-lived assets comprised of
impairments of identifiable intangible assets totaling $129 million
and $54 million of tangible assets;
- Restructuring expenses of $37 million;
- Finance expenses of $25 million;
- Contingent consideration of $14 million;
- Purchase of in process R&D of $10 million;
- Equity compensation expenses of $32 million;
- Costs related to regulatory actions taken in facilities of $5
million;
- Divested gain in amount of $5 million;
- Minority interest adjustment of $5 million;
- Other non-GAAP items of $103 million; and
- Related tax effect of $178 million.
Teva believes that excluding such items facilitates investors'
understanding of its business. For further information, see below
the U.S. GAAP to adjusted non-GAAP reconciliation tables under
“Financial Tables” and the information under “Non-GAAP Financial
Measures.” Investors should consider non-GAAP financial measures in
addition to, and not as replacement for, or superior to, measures
of financial performance prepared in accordance with GAAP.
Cash flow generated from operating activities during the
fourth quarter of 2021 was $456 million, compared to $331 million
in the fourth quarter of 2020. The increase was mainly due to
higher profit in the fourth quarter of 2021.
Free cash flow (cash flow generated from operating
activities, net of cash used for capital investments and beneficial
interest collected in exchange for securitized accounts
receivables) was $716 million in the fourth quarter of 2021,
compared to $471 million in the fourth quarter of 2020. The
increase resulted mainly from higher cash flow generated from
operating activities.
Segment Results for the Fourth Quarter of 2021
North America Segment
Our North America segment includes the United States and
Canada.
The following table presents revenues, expenses and profit for
our North America segment for the three months ended December 31,
2021 and 2020:
Three months ended December
31,
2021
2020
(U.S. $ in millions / % of
Segment Revenues)
Revenues
$
2,003
100%
$
2,300
100%
Gross profit
1,145
57.2%
1,281
55.7%
R&D expenses
151
7.5%
167
7.2%
S&M expenses
255
12.7%
258
11.2%
G&A expenses
88
4.4%
119
5.2%
Other income
(17)
(0.8%)
(1)
§
Segment profit*
$
668
33.4%
$
738
32.1%
* Segment profit does not include
amortization and certain other items.
§ Represents an amount less than
0.5%.
Revenues from our North America segment in the fourth
quarter of 2021 were $2,003 million, a decrease of $298 million, or
13%, compared to the fourth quarter of 2020, mainly due to lower
revenues from generic products and COPAXONE, partially offset by
higher revenues from AUSTEDO.
Our North America segment has experienced some reductions in
volume due to less physician and hospital activity during the
COVID-19 pandemic, but has also experienced increase in demand for
certain products related to the treatment of COVID-19 and its
symptoms.
Revenues in the United States, our largest market, were
$1,877 million in the fourth quarter of 2021, a decrease of $294
million, or 14%, compared to the fourth quarter of 2020.
Revenues by Major Products and Activities
The following table presents revenues for our North America
segment by major products and activities for the three months ended
December 31, 2021 and 2020:
Three months ended
December 31,
Percentage
Change
2021
2020-2021
2020-2021
(U.S. $ in millions)
Generic products
$
905
$
1,206
(25%)
AJOVY
53
36
49%
AUSTEDO
282
185
52%
BENDEKA®/TREANDA
93
102
(9%)
COPAXONE
129
213
(39%)
ProAir®*
40
67
(40%)
Anda
355
321
11%
Other
146
171
(15%)
Total
$
2,003
$
2,300
(13%)
_________
* Does not include revenues from
the ProAir authorized generic, which are included under generic
products.
Generic products revenues in our North America segment in
the fourth quarter of 2021 decreased by 25% to $905 million,
compared to the fourth quarter of 2020, mainly due to increased
competition and lower volumes as well as lower revenues from
generic launches in the fourth quarter of 2021.
In the fourth quarter of 2021, our total prescriptions were
approximately 76 million representing 8.2% of total U.S. generic
prescriptions according to IQVIA data.
AJOVY revenues in our North America segment in the fourth
quarter of 2021 were $53 million compared to $36 million in the
fourth quarter of 2020. This increase was mainly due to growth in
volume and favorable net pricing.
AUSTEDO revenues in our North America segment in the
fourth quarter of 2021 were $282 million, compared to $185 million
in the fourth quarter of 2020. This increase was mainly due to
growth in volume, an increase in average daily dose of new patients
as well as favorable net pricing.
BENDEKA and TREANDA combined revenues in our North
America segment in the fourth quarter of 2021 decreased by 9% to
$93 million, compared to the fourth quarter of 2020, mainly due to
availability of alternative therapies and continued competition
from Belrapzo® (a ready-to-dilute bendamustine hydrochloride
product from Eagle Pharmaceuticals, Inc.).
COPAXONE revenues in our North America segment in the
fourth quarter of 2021 decreased by 39% to $129 million, compared
to the fourth quarter of 2020, mainly due to generic competition in
the United States and availability of alternative therapies.
ProAir (HFA and RespiClick) revenues in our North
America segment in the fourth quarter of 2021 decreased by 40% to
$40 million, compared to the fourth quarter of 2020. In January
2019, we launched our own ProAir authorized generic in the United
States, following the launch of a generic version of Ventolin® HFA,
another albuterol inhaler. Revenues from our ProAir authorized
generic are included in “generic products” above.
Anda revenues in our North America segment in the fourth
quarter of 2021 increased by 11% to $355 million, compared to the
fourth quarter of 2020.
North America Gross Profit
Gross profit from our North America segment in the fourth
quarter of 2021 was $1,145 million, a decrease of 11% compared to
the fourth quarter of 2020. This decrease was mainly due to lower
revenues from COPAXONE and generic products, partially offset by
higher revenues from AUSTEDO and AJOVY.
Gross profit margin for our North America segment in the fourth
quarter of 2021 increased to 57.2%, compared to 55.7% in the fourth
quarter of 2020. This increase was mainly due to higher revenues
from AUSTEDO.
North America Profit
Profit from our North America segment in the fourth quarter of
2021 was $668 million, a decrease of 9% compared to $738 million in
the fourth quarter of 2020. Profit decreased mainly due to lower
revenues, partially offset by lower operating expenses, as well as
higher other income.
Europe Segment
Our Europe segment includes the European Union, the United
Kingdom and certain other European countries.
The following table presents revenues, expenses and profit for
our Europe segment for the three months ended December 31, 2021 and
2020:
Three months ended December
31,
2021
2020
(U.S. $ in millions / % of
Segment Revenues)
Revenues
$
1,268
100%
$
1,237
100%
Gross profit
760
59.9%
657
53.1%
R&D expenses
60
4.8%
67
5.4%
S&M expenses
218
17.2%
239
19.4%
G&A expenses
64
5.0%
77
6.2%
Other income
(2)
§
§
§
Segment profit*
$
420
33.1%
$
273
22.1%
___________
* Segment profit does not include
amortization and certain other items.
§ Represents an amount less than
$1 million or 0.5%, as applicable.
Revenues from our Europe segment in the fourth quarter of
2021 were $1,268 million, an increase of $31 million, or 2%,
compared to the fourth quarter of 2020. In local currency terms,
revenues increased by 4%, mainly due to higher demand for generic,
OTC and respiratory products due to the impact the COVID-19
pandemic had on purchasing patterns as well as by increasing
revenues from AJOVY.
Revenues by Major Products and Activities
The following table presents revenues for our Europe segment by
major products and activities for the three months ended December
31, 2021 and 2020:
Three months ended
December 31,
Percentage
Change
2021
2020
2020-2021
(U.S. $ in millions)
Generic products
$
932
$
920
1%
AJOVY
29
13
121%
COPAXONE
95
106
(10%)
Respiratory products
93
90
3%
Other
119
107
10%
Total
$
1,268
$
1,237
2%
Generic products revenues in our Europe segment in the
fourth quarter of 2021, including OTC products, increased by 1% to
$932 million, compared to the fourth quarter of 2020. In local
currency terms, revenues increased by 4%, mainly due to higher
demand resulting from the impact the COVID-19 pandemic had on
purchasing patterns.
AJOVY revenues in our Europe segment in the fourth
quarter of 2021, were $29 million, compared to $13 million in the
fourth quarter of 2020, mainly due to launches and reimbursements
in additional European countries and growth in existing
countries.
COPAXONE revenues in our Europe segment in the fourth
quarter of 2021 decreased by 10% to $95 million, compared to the
fourth quarter of 2020. In local currency terms, revenues decreased
by 7% due to price reductions and a decline in volume resulting
from competing glatiramer acetate products.
Respiratory products revenues in our Europe
segment in the fourth quarter of 2021 increased by 3% to $93
million, compared to the fourth quarter of 2020. In local currency
terms, revenues increased by 5% mainly due to higher demand
resulting from the impact the COVID-19 pandemic had on purchasing
patterns.
Europe Gross Profit
Gross profit from our Europe segment in the fourth quarter of
2021 was $760 million, an increase of 16% compared to $657 million
in the fourth quarter of 2020. This increase was mainly due to
higher revenues, as discussed above.
Gross profit margin for our Europe segment in the fourth quarter
of 2021 increased to 59.9%, compared to 53.1% in the fourth quarter
of 2020. This increase was mainly due to our network consolidation
activities.
Europe Profit
Profit from our Europe segment consists of gross profit less
R&D expenses, S&M expenses, G&A expenses and any other
income related to this segment. Segment profit does not include
amortization and certain other items.
Profit from our Europe segment in the fourth quarter of 2021 was
$420 million, an increase of 54% compared to $273 million in the
fourth quarter of 2020. This increase was mainly due to higher
gross profit as discussed above and lower operating expenses.
International Markets Segment
Our International Markets segment includes all countries other
than those in our North America and Europe segments. The key
markets in this segment are Japan, Russia and Israel.
On February 1, 2021, we completed the sale of the majority of
the generic and operational assets of our business venture in
Japan.
The following table presents revenues, expenses and profit for
our International Markets segment for the three months ended
December 31, 2021 and 2020:
Three months ended December
31,
2021
2020
(U.S. $ in millions / % of
Segment Revenues)
Revenues
$
527
100%
$
572
100%
Gross profit
292
55.3%
268
46.9%
R&D expenses
17
3.2%
19
3.3%
S&M expenses
114
21.6%
115
20.1%
G&A expenses
30
5.7%
40
6.9%
Other income
§
§
(1)
§
Segment profit*
$
131
24.8%
$
96
16.8%
__________
* Segment profit does not include
amortization and certain other items.
§ Represents an amount less than
$1 million or 0.5%, as applicable.
Revenues from our International Markets segment in the
fourth quarter of 2021 were $527 million, a decrease of $45
million, or 8%, compared to the fourth quarter of 2020. In local
currency terms, revenues decreased by 7% compared to the fourth
quarter of 2020, mainly due to lower sales in Japan resulting from
the divestment mentioned above, partially offset by higher revenues
in most markets.
Revenues by Major Products and Activities
The following table presents revenues for our International
Markets segment by major products and activities for the three
months ended December 31, 2021 and 2020:
Three months ended
December 31,
Percentage
Change
2021
2020
2020-2021
(U.S. $ in millions)
Generic products
$
438
$
488
(10%)
AJOVY
4
1
321%
COPAXONE
8
15
(45%)
Other
77
67
13%
Total
$
527
$
572
(8%)
Generic products revenues in our International Markets
segment, which include OTC products, were $438 million in the
fourth quarter of 2021, a decrease of 10% compared to the fourth
quarter of 2020. In local currency terms, revenues decreased by 7%,
mainly due to lower sales in Japan resulting from the divestment
mentioned above, partially offset by higher revenues in most
markets.
AJOVY was launched in certain markets in our
International Markets segment, including in Japan during the third
quarter of 2021. We are moving forward with plans to launch AJOVY
in other markets. AJOVY revenues in our International Markets
segment in the fourth quarter of 2021 were $4 million, compared to
$1 million in the fourth quarter of 2020.
COPAXONE revenues in our International Markets segment in
the fourth quarter of 2021 decreased by 45% to $8 million, compared
to the fourth quarter of 2020. In local currency terms, revenues
decreased by 39%.
International Markets Gross Profit
Gross profit from our International Markets segment in the
fourth quarter of 2021 was $292 million, an increase of 9% compared
to $268 million in the fourth quarter of 2020. Gross profit margin
for our International Markets segment in the fourth quarter of 2021
increased to 55.3%, compared to 46.9% in the fourth quarter of
2020. This increase was mainly due to higher profitability
resulting from the divestment in Japan mentioned above, partially
offset by regulatory price reductions and generic competition to
off-patented products in Japan.
International Markets Profit
Profit from our International Markets segment in the fourth
quarter of 2021 was $131 million, compared to $96 million in the
fourth quarter of 2020. This increase was mainly due to higher
gross profit as well as lower G&A expenses.
Other Activities
We have other sources of revenues, primarily the sale of active
pharmaceutical ingredients ("APIs") to third parties, certain
contract manufacturing services and an out-licensing platform
offering a portfolio of products to other pharmaceutical companies
through our affiliate Medis. Our other activities are not included
in our North America, Europe or International Markets segments.
Our revenues from other activities in the fourth quarter
of 2021 were $302 million, a decrease of 12% compared to the fourth
quarter of 2020. In local currency terms revenues decreased by 11%,
mainly due to a decrease in volumes from API and Medis resulting
from the COVID-19 pandemic, as well as lower revenues from contract
manufacturing services.
API sales to third parties in the fourth quarter of 2021
were $206 million, a decrease of 2% in both U.S. dollars and local
currency terms, compared to the fourth quarter of 2020.
Outlook for 2022 Non-GAAP
Results
$ billions, except EPS
2022 Outlook
2021 Actual
Revenues
15.6 - 16.2
15.9
COPAXONE ($m)
~850
1,005
AUSTEDO ($m)
~1,000
808
AJOVY ($m)
~400
313
Operating Income
4.2-4.5
4.4
EBITDA
4.7-5.0
4.9
EPS ($)
2.40-2.60
2.58
Share Count
1,114 million shares
1,107 million shares
Free Cash Flow
1.9 - 2.2
2.2
CAPEX
0.6
0.6
Non-GAAP Tax Rate
18% - 19%
16.4%
Annual Report on Form
10-K
Teva's Annual Report on Form 10-K for the year ended December
31, 2021, which will be filed with the SEC, will include a complete
analysis of the financial results for 2021 and will be available on
Teva’s website: http://ir.tevapharm.com, as well as on the SEC’s
website: http://www.sec.gov.
Conference Call
Teva will host a conference call and live webcast along with a
slide presentation on Wednesday, February 9, 2021 at 8:00 a.m. ET
to discuss its fourth quarter and annual 2021 results and overall
business environment. A question & answer session will
follow.
In order to participate, please dial the following numbers:
United States 1-877-870-9135
International +44 (0) 2071 928338 Israel 1-809-213-985
Passcode: 6372826.
A live webcast of the call will 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 or by
calling the following numbers: United States 1-866-331-1332;
International +44 (0) 3333 009785; passcode: 6372826.
About Teva
Teva Pharmaceutical Industries Ltd. (NYSE and TASE: TEVA) has
been developing and producing medicines to improve people’s lives
for more than a century. We are a global leader in generic and
specialty medicines with a portfolio consisting of over 3,500
products in nearly every therapeutic area. Around 200 million
people around the world take a Teva medicine every day, and are
served by one of the largest and most complex supply chains in the
pharmaceutical industry. Along with our established presence in
generics, we have significant innovative research and operations
supporting our growing portfolio of specialty and biopharmaceutical
products. Learn more at www.tevapharm.com.
Some amounts in this press release may not add up due to
rounding. All percentages have been calculated using unrounded
amounts.
Non-GAAP Financial Measures
This press release contains certain financial information that
differs from what is reported under accounting principles generally
accepted in the United States ("GAAP"). These non-GAAP financial
measures, including, but not limited to, non-GAAP EPS, non-GAAP
operating income, non-GAAP gross profit, non-GAAP gross profit
margin, EBITDA, Adjusted EBITDA, non-GAAP R&D expenses,
non-GAAP S&M expenses, non-GAAP G&A expenses, non-GAAP
financial expenses, non-GAAP income taxes, non-GAAP income (loss)
before income taxes, non-GAAP tax rate, non-GAAP net income (loss),
non-GAAP net income (loss) attributable to Teva and non-GAAP
diluted EPS are presented in order to facilitates investors'
understanding of our business. We utilize certain non-GAAP
financial measures to evaluate performance, in conjunction with
other performance metrics. The following are examples of how we
utilize the non-GAAP measures: our management and board of
directors use the non-GAAP measures to evaluate our operational
performance, to compare against work plans and budgets, and
ultimately to evaluate the performance of management; our annual
budgets are prepared on a non-GAAP basis; and senior management’s
annual compensation is derived, in part, using these non-GAAP
measures. See the attached tables for a reconciliation of the GAAP
results to the adjusted non-GAAP figures. Investors should consider
non-GAAP financial measures in addition to, and not as replacements
for, or superior to, measures of financial performance prepared in
accordance with GAAP. We are not providing forward looking guidance
for GAAP reported financial measures or a quantitative
reconciliation of forward-looking non-GAAP financial measures to
the most directly comparable GAAP measure because we are unable to
predict with reasonable certainty the ultimate outcome of certain
significant items without unreasonable effort.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, which are based on management’s current beliefs and
expectations and are subject to substantial risks and
uncertainties, both known and unknown, that could cause our future
results, performance or achievements to differ significantly from
that 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 successfully compete in the marketplace,
including: that we are substantially dependent on our generic
products; consolidation of our customer base and commercial
alliances among our customers; delays in launches of new generic
products; the increase in the number of competitors targeting
generic opportunities and seeking U.S. market exclusivity for
generic versions of significant products; our ability to develop
and commercialize biopharmaceutical products; competition for our
specialty products, including AUSTEDO, AJOVY and COPAXONE; our
ability to achieve expected results from investments in our product
pipeline; our ability to develop and commercialize additional
pharmaceutical products; and the effectiveness of our patents and
other measures to protect our intellectual property rights;
- our substantial indebtedness, which may limit our ability to
incur additional indebtedness, engage in additional transactions or
make new investments, may result in a further downgrade of our
credit ratings; and our inability to raise debt or borrow funds in
amounts or on terms that are favorable to us;
- our business and operations in general, including: uncertainty
regarding the COVID-19 pandemic and the governmental and societal
responses thereto; our ability to successfully execute and maintain
the activities and efforts related to the measures we have taken or
may take in response to the COVID-19 pandemic and associated costs
therewith; effectiveness of our optimization efforts; our ability
to attract, hire and retain highly skilled personnel; manufacturing
or quality control problems; interruptions in our supply chain;
disruptions of information technology systems; breaches of our data
security; variations in intellectual property laws; challenges
associated with conducting business globally, including political
or economic instability, major hostilities or terrorism; costs and
delays resulting from the extensive pharmaceutical regulation to
which we are subject or delays in governmental processing time due
to travel and work restrictions caused by the COVID-19
pandemic;
- the effects of reforms in healthcare regulation and reductions
in pharmaceutical pricing, reimbursement and coverage; significant
sales to a limited number of customers; our ability to successfully
bid for suitable acquisition targets or licensing opportunities, or
to consummate and integrate acquisitions; and our prospects and
opportunities for growth if we sell assets;
- compliance, regulatory and litigation matters, including:
failure to comply with complex legal and regulatory environments;
increased legal and regulatory action in connection with public
concern over the abuse of opioid medications and our ability to
reach a final resolution of the remaining opioid-related
litigation; scrutiny from competition and pricing authorities
around the world, including our ability to successfully defend
against the U.S. Department of Justice criminal charges of Sherman
Act violations; potential liability for patent infringement;
product liability claims; failure to comply with complex Medicare
and Medicaid reporting and payment obligations; compliance with
anti-corruption sanctions and trade control laws; environmental
risks; and the impact of ESG issues;
- other financial and economic risks, including: our exposure to
currency fluctuations and restrictions as well as credit risks;
potential impairments of our intangible assets; potential
significant increases in tax liabilities (including as a result of
potential tax reform in the United States); and 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; and other factors discussed in this press release and in
our Annual Report on Form 10-K for the year ended December 31,
2021, including in the sections captioned "Risk Factors” and
“Forward Looking Statements.” 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 statements or other
information contained herein, whether as a result of new
information, future events or otherwise. You are cautioned not to
put undue reliance on these forward-looking statements.
Consolidated Statements of Income (Loss)
(U.S.
dollars in millions, except share and per share data)
Three months ended
Year ended
December 31,
December 31,
2021
2020
2021
2020
(Unaudited)
(Unaudited)
(Audited)
(Audited)
Net revenues
4,100
4,454
15,878
16,659
Cost of sales
2,049
2,405
8,284
8,933
Gross profit
2,050
2,048
7,594
7,726
Research and development expenses, net
244
293
967
997
Selling and marketing expenses
632
683
2,429
2,498
General and administrative expenses
276
327
1,099
1,173
Intangible assets impairment
129
224
424
1,502
Goodwill impairment
-
-
-
4,628
Other asset impairments, restructuring and other items
113
75
341
479
Legal settlements and loss contingencies
604
50
717
60
Other income
(26
)
(10
)
(98
)
(40
)
Operating income (loss)
78
406
1,716
(3,572
)
Financial expenses – net
253
268
1,058
834
Income (loss) before income taxes
(175
)
138
658
(4,406
)
Income taxes (benefit)
(24
)
(22
)
211
(168
)
Share in (profits) losses of associated companies, net
-
(3
)
(9
)
(138
)
Net income (loss)
(151
)
162
456
(4,099
)
Net income (loss) attributable to non-controlling interests
7
12
39
(109
)
Net income (loss) attributable to Teva
(159
)
150
417
(3,990
)
Earnings (loss) per share
attributable to Teva: Basic ($)
(0.14
)
0.14
0.38
(3.64
)
Diluted ($)
(0.14
)
0.14
0.38
(3.64
)
Weighted average number of shares (in millions):
Basic
1,103
1,096
1,102
1,095
Diluted
1,103
1,100
1,107
1,095
Non-GAAP net income attributable to Teva:*
854
753
2,855
2,830
Non-GAAP net income attributable to Teva for diluted earnings
per share:
854
753
2,855
2,830
Non-GAAP earnings per share attributable to Teva:*
Basic ($)
0.77
0.69
2.59
2.58
Diluted ($)
0.77
0.68
2.58
2.57
Non-GAAP average number of shares (in millions):
Basic
1,103
1,096
1,102
1,095
Diluted
1,108
1,100
1,107
1,099
* See reconciliation attached.
Condensed Consolidated Balance Sheets
(U.S.
dollars in millions)
(Audited)
December 31,
December 31,
2021
2020
ASSETS Current assets: Cash and cash equivalents
2,165
2,177
Accounts receivables, net of allowance for credit losses of $90
million and $126 million as of December 31, 2021 and December 31,
2020
4,529
4,581
Inventories
3,818
4,403
Prepaid expenses
1,075
945
Other current assets
965
710
Assets held for sale
19
189
Total current assets
12,573
13,005
Deferred income taxes
596
695
Other non-current assets
515
538
Property, plant and equipment, net
5,982
6,296
Operating lease right-of-use assets
495
559
Identifiable intangible assets, net
7,466
8,923
Goodwill
20,040
20,624
Total assets
47,666
50,640
LIABILITIES & EQUITY Current liabilities:
Short-term debt
1,426
3,188
Sales reserves and allowances
4,241
4,824
Trade payables
1,686
1,756
Employee-related obligations
563
685
Accrued expenses
2,208
1,780
Other current liabilities
903
933
Total current liabilities
11,027
13,164
Long-term liabilities: Deferred income taxes
784
964
Other taxes and long-term liabilities
2,578
2,240
Senior notes and loans
21,617
22,731
Operating lease liabilities
416
479
Total long-term liabilities
25,395
26,414
Equity: Teva shareholders’ equity
10,278
10,026
Non-controlling interests
966
1,035
Total equity
11,244
11,061
Total liabilities and equity
47,666
50,640
TEVA PHARMACEUTICAL INDUSTRIES LIMITED CONSOLIDATED
STATEMENTS OF CASH FLOWS (U.S. dollars in millions)
(Unaudited)
Year ended
Three months ended
December 31,
December 31,
2021
2020
2021
2020
Operating activities:
(Audited)
(Audited)
(Unaudited)
(Unaudited)
Net income (loss) $
456
$
(4,099
)
$
(152
)
$
162
Adjustments to reconcile net income (loss) to net cash provided by
operations: Impairment of goodwill, long-lived assets and assets
held for sale
584
6,546
183
232
Depreciation and amortization
1,330
1,557
320
395
Net change in operating assets and liabilities
(1,701
)
(2,188
)
180
(561
)
Deferred income taxes — net and uncertain tax positions
(120
)
(696
)
(133
)
(40
)
Stock-based compensation
119
129
33
38
Other items
16
100
20
46
Research and development in process
10
80
10
40
Net loss (gain) from investments and from sale of business and long
lived assets
104
(213
)
(5
)
19
Net cash provided by operating activities
798
1,216
456
331
Investing activities: Beneficial interest collected
in exchange for securitized trade receivables
1,648
1,405
370
303
Proceeds from sale of business and long lived assets
311
67
42
13
Purchases of property, plant and equipment
(562
)
(578
)
(153
)
(176
)
Purchases of investments and other assets
(47
)
(55
)
(11
)
(9
)
Proceeds from sale of investments
172
12
-
-
Other investing activities
1
12
(2
)
10
Net cash provided by investing activities
1,523
863
246
141
Financing activities: Repayment of senior notes and
loans and other long term liabilities
(6,649
)
(1,871
)
(5,174
)
-
Proceeds from senior notes, net of issuance costs
4,974
-
4,974
-
Proceeds from short term debt
700
550
200
319
Repayment of short term debt
(700
)
(559
)
(500
)
(443
)
Redemption of convertible debentures
(491
)
-
-
-
Other financing activities
(6
)
(5
)
(1
)
(1
)
Net cash used in financing activities
(2,172
)
(1,885
)
(501
)
(125
)
Translation adjustment on cash and cash equivalents
(128
)
8
(48
)
3
Net change in cash and cash equivalents and restricted cash
$
21
$
202
$
153
$
350
Balance of cash and cash equivalents and restricted cash at
beginning of year
2,177
1,975
2,045
1,827
Balance of cash and cash equivalents and restricted cash at end
of year
2,198
2,177
2,198
2,177
Reconciliation of cash, cash equivalents and
restricted cash reported in the consolidated balance sheets:
Cash and cash equivalents
2,165
2,177
2,165
2,177
Restricted cash included in other current assets
33
-
33
-
Total cash, cash equivalents and restricted cash shown in the
statements of cash flows
2,198
2,177
2,198
2,177
Three Months Ended December
31, 2021
U.S. $ and shares in millions
(except per share amounts)
GAAP
Excluded for non GAAP
measurement
Non GAAP
Amortization of
purchased
intangible assets
Legal
settlements and
loss
contingencies
Impairment of
long-lived
assets
Other R&D
expenses
Restructuring
costs
Costs related to
regulatory actions
taken in facilities
Equity
compensation
Contingent
consideration
Gain on sale
of business
Other
non
GAAP
items
Other items
Net revenue
4,100
4,100
Cost of sales
2,049
165
5
6
75
1,798
Gross profit
2,050
165
-
-
-
-
5
6
-
-
75
-
2,301
Gross profit margin
50.0
%
56.1
%
R&D
244
10
5
-
229
S&M
632
24
8
-
600
G&A
276
12
20
244
Other income
(26
)
(7
)
(19
)
Legal settlements and loss contingencies
604
604
-
Other asset impairments, restructuring and other items
113
54
37
14
8
-
Intangible assets impairment
129
129
-
Operating income (loss)
78
188
604
183
10
37
5
32
14
(7
)
103
-
1,248
Financial expenses
253
25
229
Income (loss) before income taxes
(175
)
188
604
183
10
37
5
32
14
(7
)
103
25
1,019
Income taxes
(24
)
(178
)
153
Net income (loss)
(151
)
188
604
183
10
37
5
32
14
(7
)
103
(153
)
866
Net income (loss) attributable to non-controlling interests
7
(5
)
12
Net income (loss) attributable to Teva
(159
)
188
604
183
10
37
5
32
14
(7
)
103
(158
)
854
EPS - Basic
(0.14
)
0.92
0.77
EPS - Diluted
(0.14
)
0.91
0.77
The non-GAAP diluted weighted
average number of shares was 1,108 million for the three months
ended December 31, 2021.
Non-GAAP income taxes for the
three months ended December 31, 2021 were 15% on pre-tax non-GAAP
income.
* Other non-GAAP items include
other exceptional items that we believe are sufficiently large that
their exclusion is important to facilitate an understanding of
trends in our financial results, such as certain accelerated
depreciation expenses and inventory write offs, primarily related
to the rationalization of our plants and other unusual events.
Adjusted EBITDA reconciliation Operating income
(loss)
78
Add: Depreciation
132
Amortization
188
EBITDA
397
Legal settlements and loss contingencies
604
Impairment of long lived assets
183
Other R&D expenses
10
Restructuring costs
37
Costs related to regulatory actions taken in facilities
5
Equity compensation
32
Contingent consideration
14
Gain on sale of business
(7
)
Other non-GAAP items (excluding accelerated depreciation of $4.7
million)*
98
Adjusted EBITDA
1,373
* Other non-GAAP items include other exceptional items that
we believe are sufficiently large that their exclusion is important
to facilitate an understanding of trends in our financial results,
such as certain accelerated depreciation expenses and inventory
write offs, primarily related to the rationalization of our plants
and other unusual events.
Three Months Ended December
31, 2020
U.S. $ and shares in millions
(except per share amounts)
GAAP
Excluded for non GAAP
measurement
Non GAAP
Amortization of
purchased
intangible assets
Legal settlements
and loss
contingencies
Impairment of
long-lived assets
Other R&D
expenses
Restructuring costs
Costs related to
regulatory actions
taken in facilities
Equity compensation
Contingent
consideration
Gain on sale of
business
Other non
GAAP items
Other items
Net revenue
4,454
4,454
Cost of sales
2,405
231
7
8
34
2,126
Gross profit
2,048
231
-
-
-
-
7
8
-
-
34
-
2,327
Gross profit margin
46.0
%
52.3
%
R&D expenses
293
34
6
-
254
S&M expenses
683
31
11
14
627
G&A expenses
327
15
-
312
Other (income) expense
(10
)
(5
)
(5
)
Legal settlements and loss contingencies
50
50
-
Other asset impairments, restructuring and other items
75
8
38
15
14
-
Intangible assets impairment
224
224
-
Operating income (loss)
406
262
50
233
34
38
7
40
15
(5
)
62
-
1,140
Financial expenses
268
33
235
Income (loss) before income taxes
138
262
50
233
34
38
7
40
15
(5
)
62
33
905
Income taxes
(22
)
(162
)
141
Share in profits (losses) of associated companies – net
(3
)
-
(3
)
Net income (loss)
162
262
50
233
34
38
7
40
15
(5
)
62
(129
)
767
Net income (loss) attributable to non-controlling interests
12
(2
)
14
Net income (loss) attributable to Teva
150
262
50
233
34
38
7
40
15
(5
)
62
(131
)
753
EPS - Basic
0.14
0.55
0.69
EPS - Diluted
0.14
0.55
0.68
The non-GAAP diluted weighted
average number of shares was 1,100 million for the three months
ended December 31, 2020.
Non-GAAP income taxes for the
three months ended December 31, 2021 were 16% on pre-tax non-GAAP
income.
* Other non-GAAP items include
other exceptional items that we believe are sufficiently large that
their exclusion is important to facilitate an understanding of
trends in our financial results, such as certain accelerated
depreciation expenses and inventory write offs, primarily related
to the rationalization of our plants and other unusual events.
Adjusted EBITDA reconciliation Operating income
(loss)
406
Add: Depreciation
140
Amortization
262
EBITDA
808
Legal settlements and loss contingencies
50
Impairment of long lived assets
233
Other R&D expenses
34
Restructuring costs
38
Costs related to regulatory actions taken in facilities
7
Equity compensation
40
Contingent consideration
15
Gain on sale of business
(5
)
Other non-GAAP items (excluding accelerated depreciation of $3
million)*
58
1,277
* Other non-GAAP items include other exceptional items that
we believe are sufficiently large that their exclusion is important
to facilitate an understanding of trends in our financial results,
such as certain accelerated depreciation expenses and inventory
write offs, primarily related to the rationalization of our plants
and other unusual events.
Year Ended December 31,
2021
(U.S. $ and shares in
millions, except per share amounts)
GAAP
Excluded for non-GAAP measurement
Non-GAAP
Amortization
of purchased
intangible
assets
Legal
settlements and
loss
contingencies
Impairment
of long-lived
assets
Other R&D
expenses
Restructuring
costs
Costs related
to regulatory
actions taken
in facilities
Equity
compensation
Contingent
consideration
Gain on
sale of
business
Other non-
GAAP items
Other items
Net revenue
15,878
15,878
Cost of sales
8,284
702
23
23
270
7,266
Gross profit
7,594
702
-
-
-
-
23
23
-
-
270
-
8,612
Gross profit margin
48.0
%
54.0
%
R&D expenses
967
15
19
-
933
S&M expenses
2,429
99
33
-
2,297
G&A expenses
1,099
43
27
1,029
Other (income) expense
(98
)
(51
)
(48
)
Legal settlements and loss contingencies
717
717
-
Other asset impairments, restructuring and other items
341
160
133
7
40
-
Intangible assets impairment
424
424
-
Operating income (loss)
1,716
802
717
584
15
133
23
118
7
(51
)
337
-
4,401
Financial expenses
1,058
128
930
Income (loss) before income taxes
658
802
717
584
15
133
23
118
7
(51
)
337
128
3,471
Income taxes
211
(360
)
570
Share in profits (losses) of associated companies – net
(9
)
(1
)
(8
)
Net income (loss)
456
802
717
584
15
133
23
118
7
(51
)
337
(232
)
2,909
Net income (loss) attributable to non-controlling interests
39
(15
)
54
Net income (loss) attributable to Teva
417
802
717
584
15
133
23
118
7
(51
)
337
(247
)
2,855
EPS - Basic
0.38
2.21
2.59
EPS - Diluted
0.38
2.20
2.58
The non-GAAP diluted weighted
average number of shares was 1,107 million for the year ended
December 31, 2021.
Non-GAAP income taxes for the
year ended December 31, 2021 were 16% on pre-tax non-GAAP
income.
* Other non-GAAP items include
other exceptional items that we believe are sufficiently large that
their exclusion is important to facilitate an understanding of
trends in our financial results, such as certain accelerated
depreciation expenses and inventory write offs, primarily related
to the rationalization of our plants and other unusual events.
Adjusted EBITDA reconciliation
Operating income (loss)
1,716
Add: Depreciation
528
Amortization
802
EBITDA
3,046
Legal settlements and loss contingencies
717
Impairment of long lived assets
584
Other R&D costs
15
Restructuring costs
133
Costs related to regulatory actions taken in facilities
23
Equity compensation
118
Contingent consideration
7
Gain on sale of business
(51
)
Other non-GAAP items (excluding accelerated depreciation of $18
million)*
318
Adjusted EBITDA
4,911
* Other non-GAAP items include
other exceptional items that we believe are sufficiently large that
their exclusion is important to facilitate an understanding of
trends in our financial results, such as certain accelerated
depreciation expenses and inventory write offs, primarily related
to the rationalization of our plants and other unusual events.
Year ended December 31,
2020
(U.S. $ and shares in
millions, except per share amounts)
GAAP
Excluded for non-GAAP
measurement
Non-GAAP
Amortization of
purchased
intangible assets
Legal
settlements and
loss
contingencies
Goodwill
impairment
Impairment of
long-lived assets
Other
R&D
expenses
Restructuring
costs
Costs related to
regulatory actions
taken in facilities
Equity
compensation
Contingent
consideration
Gain on sale
of business
Other non-
GAAP items
Other
items
Net revenue
16,659
16,659
Cost of sales
8,933
894
23
27
63
7,925
Gross profit
7,726
894
23
27
63
8,734
Gross profit margin
46.4
%
52.4
%
R&D expenses
997
37
20
-
941
S&M expenses
2,498
126
36
14
2,322
G&A expenses
1,173
46
12
1,115
Other (income) expense
(40
)
(8
)
(31
)
Legal settlements and loss contingencies
60
60
-
Other asset impairments, restructuring and other items
479
416
120
(81
)
24
-
Intangible assets impairment
1,502
1,502
-
Goodwill impairment
4,628
4,628
-
Operating income (loss)
(3,572
)
1,020
60
4,628
1,918
37
120
23
129
(81
)
(8
)
114
-
4,388
Financial expenses, net
834
(85
)
918
Income (loss) before income taxes
(4,406
)
1,020
60
4,628
1,918
37
120
23
129
(81
)
(8
)
114
(85
)
3,470
Income taxes
(168
)
(745
)
577
Share in profits (losses) of associated companies – net
(138
)
(134
)
(4
)
Net income (loss)
(4,099
)
1,020
60
4,628
1,918
37
120
23
129
(81
)
(8
)
114
(964
)
2,897
Net income (loss) attributable to non-controlling interests
(109
)
(177
)
68
Net income (loss) attributable to Teva
(3,990
)
1,020
60
4,628
1,918
37
120
23
129
(81
)
(8
)
114
(1,140
)
2,830
EPS - Basic
(3.64
)
6.23
2.58
EPS - Diluted
(3.64
)
6.22
2.57
The non-GAAP diluted weighted
average number of shares was 1,099 million for the year ended
December 31, 2020.
Non-GAAP income taxes for the
year ended December 31, 2020 were 17% on pre-tax non-GAAP
income.
* Other non-GAAP items include
other exceptional items that we believe are sufficiently large that
their exclusion is important to facilitate an understanding of
trends in our financial results, such as certain accelerated
depreciation expenses and inventory write offs, primarily related
to the rationalization of our plants and other unusual events.
Adjusted EBITDA reconciliation Operating
income (loss)
(3,572
)
Add: Depreciation
545
Amortization
1,020
EBITDA
(2,007
)
Legal settlements and loss contingencies
60
Goodwill impairment
4,628
Impairment of long lived assets
1,918
Other R&D expenses
37
Restructuring costs
120
Costs related to regulatory actions taken in facilities
23
Equity compensation
129
Contingent consideration
(81
)
Gain on sale of business
(8
)
Other non-GAAP items (excluding accelerated depreciation of $21
million)*
93
Adjusted EBITDA
4,912
* Other non-GAAP items include
other exceptional items that we believe are sufficiently large that
their exclusion is important to facilitate an understanding of
trends in our financial results, such as certain accelerated
depreciation expenses and inventory write offs, primarily related
to the rationalization of our plants and other unusual events.
Segment Information
North America
Europe
International Markets
Three months ended
December 31,
Three months ended
December 31,
Three months ended
December 31,
2021
2020
2021
2020
2021
2020
(U.S. $ in millions)
(U.S. $ in millions)
(U.S. $ in millions)
Revenues $
2,003
$
2,300
$
1,268
$
1,237
$
527
$
572
Gross profit
1,145
1,281
760
657
292
268
R&D expenses
151
167
60
67
17
19
S&M expenses
255
258
218
239
114
115
G&A expenses
88
119
64
77
30
40
Other (income) expense
(17
)
(1
)
(2
)
§ §
(1
)
Segment profit $
668
$
738
$
420
$
273
$
131
$
96
Segment Information
North America
Europe
International Markets
Year ended December
31,
Year ended December
31,
Year ended December
31,
2021
2020
2021
2020
2021
2020
(U.S. $ in millions) (U.S. $ in millions)
(U.S. $ in millions)
Revenues $
7,809
$
8,447
$
4,886
$
4,757
$
2,032
$
2,154
Gross profit
4,226
4,489
2,823
2,666
1,118
1,096
R&D expenses
618
622
244
247
68
70
S&M expenses
988
1,013
846
830
417
427
G&A expenses
427
443
244
261
109
136
Other (income) expense
(31
)
(10
)
(5
)
(3
)
(5
)
(11
)
Segment profit $
2,224
$
2,421
$
1,494
$
1,331
$
529
$
474
Reconciliation of our segment profit
to consolidated income before
income taxes
Three months ended
December 31,
2021
2020
(U.S.$ in millions)
North America profit $
668
$
738
Europe profit
420
273
International Markets profit
131
96
Total segment profit
1,219
1,107
Profit of other activities
29
33
Total segment profit
1,248
1,140
Amounts not allocated to segments: Amortization
188
262
Other asset impairments, restructuring and other items
113
75
Intangible asset impairments
129
224
Legal settlements and loss contingencies
604
50
Other unallocated amounts
136
123
Consolidated operating income (loss)
78
406
Financial expenses - net
253
268
Consolidated income (loss) before income taxes $
(175
)
$
138
Reconciliation of our segment profit
to consolidated income before
income taxes
Year ended
December 31,
2021
2020
(U.S.$ in millions)
North America profit $
2,224
$
2,421
Europe profit
1,494
1,331
International Markets profit
529
474
Total segment profit
4,246
4,225
Profit (loss) of other activities
154
163
Total segment profit
4,401
4,388
Amounts not allocated to segments: Amortization
802
1,020
Other asset impairments, restructuring and other items
341
479
Goodwill impairment
-
4,628
Intangible asset impairments
424
1,502
Legal settlements and loss contingencies
717
60
Other unallocated amounts
402
271
Consolidated operating income (loss)
1,716
(3,572
)
Financial expenses - net
1,058
834
Consolidated income (loss) before income taxes $
658
$
(4,406
)
Revenues by Activity and
Geographical Area
(Unaudited)
Three months ended
December 31,
Percentage
Change
2021
2020
2020-2021
(U.S.$ in millions)
North America segment Generics products $
905
$
1,206
(25%)
AJOVY
53
36
49%
AUSTEDO
282
185
52%
BENDEKA/TREANDA
93
102
(9%)
COPAXONE
129
213
(39%)
ProAir*
40
67
(40%)
Anda
355
321
11%
Other
146
171
(15%)
Total
2,003
2,300
(13%)
* Does not include revenues from the ProAir authorized
generic, which are included under generic products.
Three months ended
December 31,
Percentage
Change
2021
2020
2020-2021
(U.S.$ in millions)
Europe segment Generics products $
932
$
920
1%
AJOVY
29
13
121%
COPAXONE
95
106
(10%)
Respiratory products
93
90
3%
Other
119
107
10%
Total
1,268
1,237
2%
Three months ended
December 31,
Percentage
Change
2021
2020
2020-2021
(U.S.$ in millions)
International Markets segment Generics products $
438
$
488
(10%)
AJOVY
4
1
321%
COPAXONE
8
15
(45%)
Other
77
67
13%
Total
527
572
(8%)
Revenues by Activity and
Geographical Area
(Unaudited)
Year ended
December 31,
Percentage
Change
2021
2020
2020-2021
(U.S.$ in millions)
North America segment Generics products $
3,769
4,010
(6%)
AJOVY
176
134
31%
AUSTEDO
802
637
26%
BENDEKA/TREANDA
385
415
(7%)
COPAXONE
577
884
(35%)
ProAir*
180
241
(25%)
Anda
1,323
1,462
(9%)
Other
597
664
(10%)
Total
7,809
8,447
(8%)
* Does not include revenues from the ProAir authorized
generic, which are included under generic products.
Year ended
December 31,
Percentage
Change
2021
2020
2020-2021
(U.S.$ in millions)
Europe segment Generics products $
3,569
$
3,513
2%
AJOVY
87
31
184%
COPAXONE
391
400
(2%)
Respiratory products
356
353
1%
Other
483
459
5%
Total
4,886
4,757
3%
Year ended
December 31,
Percentage
Change
2021
2020
2020-2021
(U.S.$ in millions)
International Markets segment Generics products $
1,649
$
1,792
(8%)
AJOVY
50
18
179%
COPAXONE
37
53
(29%)
Other
295
291
1%
Total
2,032
2,154
(6%)
Free cash flow reconciliation
(Unaudited)
Three months ended December
31,
2021
2020
(U.S. $ in millions)
Net cash provided by operating activities
456
331
Beneficial interest collected in exchange for securitized accounts
receivables
370
303
Purchase of property, plant and equipment
(153
)
(176
)
Proceeds from sale of business and long lived assets
43
13
Free cash flow $
716
$
471
Free cash flow reconciliation
(Unaudited)
Year ended December
31,
2021
2020
(U.S. $ in millions)
Net cash provided by operating activities
798
1,216
Beneficial interest collected in exchange for securitized accounts
receivables
1,648
1,405
Purchases of property, plant and equipment
(562
)
(578
)
Proceeds from sale of business and long lived assets
311
67
Free cash flow $
2,196
$
2,110
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220209005331/en/
IR Contacts Ran Meir (267) 468-4475 Yael Ashman +972 (3)
914 8262
PR Contacts Kelley Dougherty (973) 832-2810 Eden Klein
+972 (3) 906 2645
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