Full Press Release Details
NORTH CHICAGO, Ill. , Jan. 29, 2016 /PRNewswire/ -- AbbVie (NYSE: ABBV ) today announced financial results for the fourth quarter and full year ended Dec. 31, 2015 .
"AbbVie delivered strong performance in 2015, exceeding original sales, margin expansion, and earnings projections for the year," said Richard A. Gonzalez , chairman and chief executive officer, AbbVie. "We achieved significant growth in 2015, and expect to continue building on that momentum in 2016 with another year of strong performance."
Fourth-Quarter Results
Key Events from the Fourth Quarter
Confirming Full-Year 2016 Outlook
AbbVie is confirming its diluted earnings-per-share guidance of $4.90 to $5.10 on an adjusted basis for the full-year 2016, representing strong double-digit growth versus 2015 and positioning AbbVie to be among the industry leaders for growth again in 2016. The company's 2016 adjusted diluted earnings-per-share guidance excludes $0.45 per share of intangible asset amortization expense and other specified items. Including these items, AbbVie's diluted earnings-per-share guidance is $4.45 to $4.65 on a GAAP basis.
AbbVie is a global, research-based biopharmaceutical company formed in 2013 following separation from Abbott Laboratories. The company's mission is to use its expertise, dedicated people and unique approach to innovation to develop and market advanced therapies that address some of the world's most complex and serious diseases. Together with its wholly-owned subsidiary, Pharmacyclics, AbbVie employs more than 28,000 people worldwide and markets medicines in more than 170 countries. For further information on the company and its people, portfolio and commitments, please visit www.abbvie.com . Follow @abbvie on Twitter or view careers on our Facebook or LinkedIn page.
Conference Call
AbbVie will host an investor conference call today at 8:00 a.m. Central time to discuss our fourth-quarter performance. The call will be webcast through AbbVie's Investor Relations Web site at www.abbvieinvestor.com . An archived edition of the call will be available after 11:00 a.m. Central time .
Non-GAAP Financial Results
Financial results for 2014 and 2015 are presented on both a reported and a non-GAAP basis. Reported results were prepared in accordance with GAAP and include all revenue and expenses recognized during the period. Non-GAAP results adjust for certain non-cash items and for factors that are unusual or unpredictable, and exclude those costs, expenses, and other specified items presented in the reconciliation tables later in this release. AbbVie's management believes non-GAAP financial measures provide useful information to investors regarding AbbVie's results of operations and assist management, analysts, and investors in evaluating the performance of the business. Non-GAAP financial measures should be considered in addition to, and not as a substitute for, measures of financial performance prepared in accordance with GAAP. The company's 2016 financial guidance is also being provided on both a reported and a non-GAAP basis.
Forward-Looking Statements
Some statements in this news release may be forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "anticipate," "project" and similar expressions, among others, generally identify forward-looking statements. AbbVie cautions that these forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those indicated in the forward-looking statements. Such risks and uncertainties include, but are not limited to challenges to intellectual property, and competition from other products, difficulties inherent in the research and development process, adverse litigation or government action, and changes to laws and regulations applicable to our industry. Additional information about the economic, competitive, governmental, technological and other factors that may affect AbbVie's operations is set forth in item 1A, "Risk Factors," in AbbVie's 2014 Annual Report on Form 10-K and in item 1A, "Risk Factors" of Part II of AbbVie's second quarter 2015 Quarterly Report on Form 10-Q, which have been filed with the Securities and Exchange Commission. AbbVie undertakes no obligation to release publicly any revisions to forward-looking statements as a result of subsequent events or developments, except as required by law.
| AbbVie Inc. Key Product Revenues Quarter Ended Dec. 31, 2015 (Unaudited) | ||||||||
| % Change vs. 4Q14 | ||||||||
| Net Revenues (in millions) | International | Total | ||||||
| U.S. | Int'l. | Total | U.S. | Operational | Reported | Operational | Reported | |
| ADJUSTED NET REVENUES a | $3,811 a | $2,549 | $6,360 a | 23.6% a | 25.4% | 11.4% | 24.4% a | 18.4% a |
| Humira | 2,332 | 1,385 | 3,717 | 20.7 | 9.7 | (3.4) | 16.0 | 10.5 |
| Imbruvica | 295 | 48 b | 343 | n/m | n/m | n/m | n/m | n/m |
| Viekira | 197 | 357 | 554 | n/m | n/m | n/m | n/m | n/m |
| Creon | 185 | -- | 185 | 22.8 | n/a | n/a | 22.8 | 22.8 |
| Synagis | -- | 266 | 266 | n/a | (1.2) | (10.7) | (1.2) | (10.7) |
| Lupron | 189 | 46 | 235 | 17.9 | 7.7 | (1.9) | 15.6 | 13.4 |
| Synthroid | 194 | -- | 194 | 3.7 | n/a | n/a | 3.7 | 3.7 |
| Kaletra | 40 | 145 | 185 | (21.8) | 5.9 | (4.6) | (1.0) | (8.9) |
| AndroGel | 194 | -- | 194 | (15.7) | n/a | n/a | (15.7) | (15.7) |
| Sevoflurane | 22 | 86 | 108 | 1.6 | (0.5) | (13.2) | (0.1) | (10.5) |
| Duodopa | 6 | 56 | 62 | n/m | 14.5 | (0.2) | 24.4 | 9.7 |
| Note: "Operational" growth reflects the percentage change over the prior year excluding the impact of exchange rate fluctuations. |
| n/a = not applicable |
| n/m = not meaningful |
| a U.S. and total net revenues in both years exclude specified items. Refer to the Reconciliation of GAAP Reported to Non-GAAP Adjusted Information for further details. Percentage change is calculated using adjusted net revenues. |
| b Reflects profit sharing for Imbruvica international revenues. |
| AbbVie Inc. Key Product Revenues Twelve Months Ended Dec. 31, 2015 (Unaudited) | ||||||||
| % Change vs. 12M14 | ||||||||
| Net Revenues (in millions) | International | Total | ||||||
| U.S. | Int'l. | Total | U.S. | Operational | Reported | Operational | Reported | |
| ADJUSTED NET REVENUES a | $13,521 a | $9,298 | $22,819 a | 25.6% a | 17.9% | 2.0% | 22.1% a | 14.8% a |
| Humira | 8,405 | 5,607 | 14,012 | 28.8 | 8.6 | (6.9) | 19.1 | 11.7 |
| Imbruvica | 659 | 95 b | 754 c | n/m | n/m | n/m | n/m | n/m |
| Viekira | 804 | 835 | 1,639 | n/m | n/m | n/m | n/m | n/m |
| Creon | 632 | -- | 632 | 22.5 | n/a | n/a | 22.5 | 22.5 |
| Synagis | -- | 740 | 740 | n/a | 0.6 | (11.3) | 0.6 | (11.3) |
| Lupron | 653 | 173 | 826 | 12.5 | (0.2) | (12.9) | 9.3 | 6.1 |
| Synthroid | 755 | -- | 755 | 6.4 | n/a | n/a | 6.4 | 6.4 |
| Kaletra | 163 | 537 | 700 | (23.8) | (4.9) | (18.2) | (9.6) | (19.6) |
| AndroGel | 694 | -- | 694 | (25.7) | n/a | n/a | (25.7) | (25.7) |
| Sevoflurane | 81 | 393 | 474 | (2.5) | (4.0) | (15.9) | (3.8) | (13.9) |
| Duodopa | 12 | 219 | 231 | n/m | 18.1 | (0.6) | 23.5 | 4.8 |
| Note: "Operational" growth reflects the percentage change over the prior year excluding the impact of exchange rate fluctuations. |
| n/a = not applicable |
| n/m = not meaningful |
| a U.S. and total net revenues in both years exclude specified items. Refer to the Reconciliation of GAAP Reported to Non-GAAP Adjusted Information for further details. Percentage change is calculated using adjusted net revenues. |
| b Reflects profit sharing for Imbruvica international revenues. |
| c Reflects Imbruvica revenue from the May 26 close date of the Pharmacyclics acquisition. |
| AbbVie Inc. Consolidated Statements of Earnings Quarter and Twelve Months Ended Dec. 31, 2015 and 2014 (Unaudited) (In millions, except per share data) | ||||||||
| Fourth Quarter Ended Dec. 31 | Twelve Months Ended Dec. 31 | |||||||
| 2015 | 2014 | 2015 | 2014 | |||||
| Net revenues | $6,400 | $5,452 | $22,859 | $19,960 | ||||
| Cost of products sold | 1,475 | 1,119 | 4,500 | 4,426 | ||||
| Selling, general and administrative | 1,737 | 3,341 | 6,387 | 7,724 | ||||
| Research and development | 1,075 | 879 | 4,285 | 3,297 | ||||
| Acquired in-process research and development | -- | 28 | 150 | 352 | ||||
| Other expense | -- | 500 | -- | 750 | ||||
| Total operating costs and expenses | 4,287 | 5,867 | 15,322 | 16,549 | ||||
| Operating earnings (loss) | 2,113 | (415) | 7,537 | 3,411 | ||||
| Interest expense, net | 199 | 129 | 686 | 391 | ||||
| Net foreign exchange loss | 2 | 496 | 193 | 678 | ||||
| Other (income) expense, net | (12) | (3) | 13 | (27) | ||||
| Earnings (loss) before income tax expense | 1,924 | (1,037) | 6,645 | 2,369 | ||||
| Income tax expense (benefit) | 407 | (227) | 1,501 | 595 | ||||
| Net earnings (loss) | $1,517 | $(810) | $5,144 | $1,774 | ||||
| Diluted earnings (loss) per share | $0.92 | $(0.51) | $3.13 | $1.10 | ||||
| Diluted earnings per share, excluding specified items | $1.13 | $0.89 | $4.29 | $3.32 | a) | |||
| Average diluted shares outstanding | 1,640 | 1,597 | 1,637 | 1,610 |
| AbbVie Inc. | |||||
| Reconciliation of GAAP Reported to Non-GAAP Adjusted Information | |||||
| Quarter Ended Dec. 31, 2015 | |||||
| (Unaudited) (In millions, except per share data) | |||||
| 1. | Specified items impacted results as follows: | ||||
| 4Q15 | |||||
| Earnings | Diluted | ||||
| Pre-tax | After-tax | EPS | |||
| As reported (GAAP) | $1,924 | $1,517 | $0.92 | ||
| Adjusted for specified items: | |||||
| Other revenue | (40) | (25) | (0.02) | ||
| Intangible asset amortization | 140 | 116 | 0.07 | ||
| Pharmacyclics acquisition related costs | 105 | 68 | 0.04 | ||
| Restructuring | 79 | 58 | 0.04 | ||
| Legal reserves | 125 | 101 | 0.06 | ||
| Separation costs and other | 43 | 26 | 0.02 | ||
| As adjusted (non-GAAP) | $2,376 | $1,861 | $1.13 | ||
| Other revenue is associated with milestone revenue under a previously announced collaboration. Intangible asset amortization reflects costs recognized as a result of licensing and acquisition activities. Pharmacyclics acquisition related costs reflect acquisition-related compensation expense, integration and other costs related to the acquisition of Pharmacyclics. Restructuring is primarily associated with streamlining our global operations. Separation costs and other is primarily related to the separation of AbbVie from Abbott. | |||||
| 2. | The impact of the specified items by line item was as follows: | ||||
| 4Q15 | |||||
| Net Revenues | Cost of products sold | SG&A | R&D | ||
| As reported (GAAP) | $6,400 | $1,475 | $1,737 | $1,075 | |
| Adjusted for specified items: | |||||
| Other revenue | (40) | -- | -- | -- | |
| Intangible asset amortization | -- | (140) | -- | -- | |
| Pharmacyclics acquisition related costs | -- | (49) | (15) | (41) | |
| Restructuring | -- | (24) | (39) | (16) | |
| Legal reserves | -- | -- | (125) | -- | |
| Separation costs and other | -- | (16) | (27) | -- | |
| As adjusted (non-GAAP) | $6,360 | $1,246 | $1,531 | $1,018 | |
| 3. | The adjusted tax rate for the fourth quarter of 2015 was 21.6 percent, as detailed below: | ||||
| 4Q15 | |||||
| Pre-tax | Income | ||||
| income | taxes | Tax rate | |||
| As reported (GAAP) | $1,924 | $407 | 21.1% | ||
| Specified items | 452 | 108 | 23.9% | ||
| As adjusted (non-GAAP) | $2,376 | $515 | 21.6% |
| AbbVie Inc. | |||||||||
| Reconciliation of GAAP Reported to Non-GAAP Adjusted Information | |||||||||
| Quarter Ended Dec. 31, 2014 | |||||||||
| (Unaudited) (In millions, except per share data) | |||||||||
| 1. | Specified items impacted results as follows: | ||||||||
| 4Q14 | |||||||||
| Earnings | Diluted | ||||||||
| Pre-tax | After-tax | EPS | |||||||
| As reported (GAAP) | ($1,037) | ($810) | ($0.51) | ||||||
| Adjusted for specified items: | |||||||||
| Other revenue | (81) | (81) | (0.05) | ||||||
| Intangible asset amortization | 96 | 69 | 0.04 | ||||||
| Acquired IPR&D | 28 | 29 | 0.02 | ||||||
| Calico collaboration | 500 | 500 | 0.31 | ||||||
| Shire transaction costs | 2,227 | 1,623 | 1.00 | ||||||
| Separation costs and other | 134 | 116 | 0.08 | ||||||
| As adjusted (non-GAAP) | $1,867 | $1,446 | $0.89 | ||||||
| Other revenue principally includes royalty income from prior periods recognized in the fourth quarter of 2014 as a result of the settlement of a licensing arrangement. Intangible asset amortization reflects costs recognized as a result of licensing and acquisition activities. Acquired IPR&D primarily reflects an upfront payment related to a licensing arrangement with a third party. Calico collaboration reflects a charge recorded related to the previously announced Calico collaboration. Shire transaction costs are expenses related to the terminated Shire transaction. Separation costs and other is primarily related to the separation of AbbVie from Abbott. | |||||||||
| 2. | The impact of the specified items by line item was as follows: | ||||||||
| 4Q14 | |||||||||
| Net Revenues | Cost of products sold | SG&A | R&D | Acquired IPR&D | Other operating expense | Interest expense | Net foreign exchange loss (gain) | ||
| As reported (GAAP) | $5,452 | $1,119 | $3,341 | $879 | $28 | $500 | $129 | $496 | |
| Adjusted for specified items: | |||||||||
| Other revenue | (81) | -- | -- | -- | -- | -- | -- | -- | |
| Intangible asset amortization | -- | (96) | -- | -- | -- | -- | -- | -- | |
| Acquired IPR&D | -- | -- | -- | -- | (28) | -- | -- | -- | |
| Calico collaboration | -- | -- | -- | -- | -- | (500) | -- | -- | |
| Shire transaction costs | -- | -- | (1,660) | -- | -- | -- | (66) | (501) | |
| Separation costs and other | -- | (15) | (117) | (2) | -- | -- | -- | -- | |
| As adjusted (non-GAAP) | $5,371 | $1,008 | $1,564 | $877 | -- | -- | $63 | ($5) | |
| 3. | The adjusted tax rate for the fourth quarter of 2014 was 22.5 percent, as detailed below: | ||||||||
| 4Q14 | |||||||||
| Pre-tax | Income | ||||||||
| income | taxes | Tax rate | |||||||
| As reported (GAAP) | ($1,037) | ($227) | 21.9% | ||||||
| Specified items | 2,904 | 648 | 22.3% | ||||||
| As adjusted (non-GAAP) | $1,867 | $421 | 22.5% |
| AbbVie Inc. | ||||||||
| Reconciliation of GAAP Reported to Non-GAAP Adjusted Information | ||||||||
| Twelve Months Ended Dec. 31, 2015 | ||||||||
| (Unaudited) (In millions, except per share data) | ||||||||
| 1. | Specified items impacted results as follows: | |||||||
| 12M15 | ||||||||
| Earnings | Diluted | |||||||
| Pre-tax | After-tax | EPS | ||||||
| As reported (GAAP) | $6,645 | $5,144 | $3.13 | |||||
| Adjusted for specified items: | ||||||||
| Other revenue | (40) | (25) | (0.02) | |||||
| Intangible asset amortization | 419 | 328 | 0.20 | |||||
| Separation costs | 270 | 223 | 0.13 | |||||
| Pharmacyclics acquisition related costs | 645 | 410 | 0.25 | |||||
| Milestones and other R&D expenses | 480 | 433 | 0.26 | |||||
| Acquired IPR&D | 150 | 150 | 0.09 | |||||
| Shire termination | 170 | 170 | 0.10 | |||||
| Restructuring | 113 | 82 | 0.06 | |||||
| Legal reserves | 165 | 129 | 0.08 | |||||
| Other | 23 | 16 | 0.01 | |||||
| As adjusted (non-GAAP) | $9,040 | $7,060 | $4.29 | |||||
| Other revenue is associated with a milestone payment received under a previously announced collaboration. Intangible asset amortization reflects costs recognized as a result of licensing and acquisition activities. Separation costs are expenses related to the separation of AbbVie from Abbott. Pharmacyclics acquisition related costs reflect acquisition-related compensation expense, transaction, financing, integration and other costs related to the acquisition of Pharmacyclics. Milestones and other R&D expenses are associated with a milestone payment for a previously announced collaboration and the purchase of an FDA priority review voucher from a third party. Acquired IPR&D primarily reflects the C 2 N collaboration. Shire termination reflects the completed liquidation of remaining foreign currency positions related to the terminated Shire transaction, as communicated in the fourth quarter of 2014. Restructuring is primarily associated with streamlining our global operations. | ||||||||
| 2. | The impact of the specified items by line item was as follows: | |||||||
| 12M15 | ||||||||
| Net Revenues | Cost of products sold | SG&A | R&D | Acquired IPR&D | Interest expense | Net foreign exchange loss | ||
| As reported (GAAP) | $22,859 | $4,500 | $6,387 | $4,285 | $150 | $686 | $193 | |
| Adjusted for specified items: | ||||||||
| Other revenue | (40) | -- | -- | -- | -- | -- | -- | |
| Intangible asset amortization | -- | (419) | -- | -- | -- | -- | -- | |
| Separation costs | -- | (5) | (265) | -- | -- | -- | -- | |
| Pharmacyclics acquisition related costs | -- | (113) | (294) | (152) | -- | (86) | -- | |
| Milestones and other R&D expenses | -- | -- | -- | (480) | -- | -- | -- | |
| Acquired IPR&D | -- | -- | -- | -- | (150) | -- | -- | |
| Shire termination | -- | -- | -- | -- | -- | -- | (170) | |
| Restructuring | -- | (42) | (39) | (32) | -- | -- | -- | |
| Legal reserves | -- | -- | (165) | -- | -- | -- | -- | |
| Other | -- | (16) | (3) | (4) | -- | -- | -- | |
| As adjusted (non-GAAP) | $22,819 | $3,905 | $5,621 | $3,617 | -- | $600 | $23 | |
| 3. | The adjusted tax rate for the full-year 2015 was 21.9 percent, as detailed below: | |||||||
| 12M15 | ||||||||
| Pre-tax | Income | |||||||
| income | taxes | Tax rate | ||||||
| As reported (GAAP) | $6,645 | $1,501 | 22.6% | |||||
| Specified items | 2,395 | 479 | 20.0% | |||||
| As adjusted (non-GAAP) | $9,040 | $1,980 | 21.9% |
| AbbVie Inc. | ||||||||||
| Reconciliation of GAAP Reported to Non-GAAP Adjusted Information | ||||||||||
| Twelve Months Ended Dec. 31, 2014 | ||||||||||
| (Unaudited) (In millions, except per share data) | ||||||||||
| 1. | Specified items impacted results as follows: | |||||||||
| 12M14 | ||||||||||
| Earnings | Diluted | |||||||||
| Pre-tax | After-tax | EPS | ||||||||
| As reported (GAAP) | $2,369 | $1,774 | $1.10 | |||||||
| Adjusted for specified items: | ||||||||||
| Other revenue | (81) | (81) | (0.05) | |||||||
| Intangible asset amortization | 403 | 287 | 0.18 | |||||||
| Separation costs | 445 | 385 | 0.24 | |||||||
| Milestones and other R&D expenses | 40 | 40 | 0.02 | |||||||
| Acquired IPR&D | 352 | 251 | 0.15 | |||||||
| Calico collaboration | 750 | 750 | 0.46 | |||||||
| Shire transaction costs | 2,510 | 1,802 | 1.12 | |||||||
| Other | 136 | 167 | 0.10 | |||||||
| As adjusted (non-GAAP) | $6,924 | $5,375 | $3.32 | |||||||
| Other revenue principally includes royalty income from prior periods recognized in the fourth quarter of 2014 as a result of the settlement of a licensing arrangement. Intangible asset amortization reflects costs recognized as a result of licensing and acquisition activities. Separation costs are expenses related to the separation of AbbVie from Abbott. Milestones and other R&D expenses are associated with payments for previously announced collaborations. Acquired IPR&D reflects upfront payments related to previously announced collaborations. Calico collaboration reflects charges related to the previously announced Calico collaboration. Shire transaction costs are expenses related to the terminated Shire transaction. Other is primarily associated with the recognition of an additional year of the Branded Prescription Drug Fee as required by new IRS regulations. | ||||||||||
| 2. | The impact of the specified items by line item was as follows: | |||||||||
| 12M14 | ||||||||||
| Net Revenues | Cost of products sold | SG&A | R&D | Acquired IPR&D | Other operating expense | Net foreign exchange loss | Interest expense | Other (income) expense | ||
| As reported (GAAP) | $19,960 | $4,426 | $7,724 | $3,297 | $352 | $750 | $678 | $391 | ($27) | |
| Adjusted for specified items: | ||||||||||
| Other revenue | (81) | -- | -- | -- | -- | -- | -- | -- | -- | |
| Intangible asset amortization | -- | (403) | -- | -- | -- | -- | -- | -- | -- | |
| Separation costs | -- | (18) | (422) | (5) | -- | -- | -- | -- | -- | |
| Milestones and other R&D expenses | -- | -- | -- | (40) | -- | -- | -- | -- | -- | |
| Acquired IPR&D | -- | -- | -- | -- | (352) | -- | -- | -- | -- | |
| Calico collaboration | -- | -- | -- | -- | -- | (750) | -- | -- | -- | |
| Shire transaction costs | -- | -- | (1,703) | -- | -- | -- | (666) | (141) | -- | |
| Other | -- | (58) | (112) | -- | -- | -- | -- | -- | 34 | |
| As adjusted (non-GAAP) | $19,879 | $3,947 | $5,487 | $3,252 | -- | -- | $12 | $250 | $7 | |
| 3. | The adjusted tax rate for the full-year 2014 was 22.4 percent, as detailed below: | |||||||||
| 12M14 | ||||||||||
| Pre-tax | Income | |||||||||
| income | taxes | Tax rate | ||||||||
| As reported (GAAP) | $2,369 | $595 | 25.1% | |||||||
| Specified items | 4,555 | 954 | 20.9% | |||||||
| As adjusted (non-GAAP) | $6,924 | $1,549 | 22.4% |