ABBV
AbbVie Reports Second-Quarter 2016 Financial Results AbbVie (NYSE:ABBV) announced financial results for the second quarter ended June 30, 2016. AbbVie continues to deliver on our long-term strategy, as ...
Friday, July 29, 2016 7 min read
Key Takeaway: NORTH CHICAGO, Ill. , July 29, 2016 /PRNewswire/ -- AbbVie (NYSE: ABBV ) announced financial results for the second quarter ended June 30, 2016 .
"AbbVie continues to deliver on our long-term strategy, as demonstrated by our sixth consecutive quarter of double digit sales and ea
Full Press Release Details
NORTH CHICAGO, Ill. , July 29, 2016 /PRNewswire/ -- AbbVie (NYSE: ABBV ) announced financial results for the second quarter ended June 30, 2016 .
"AbbVie continues to deliver on our long-term strategy, as demonstrated by our sixth consecutive quarter of double digit sales and earnings growth," said Richard A. Gonzalez , chairman and chief executive officer, AbbVie. "A key element to our long-term sustainable performance is our advancing pipeline and this quarter we saw several regulatory approvals, including VENCLEXTA and ZINBRYTA. We also made progress on a number of clinical development programs and completed the acquisition of Stemcentrx, which adds a promising late-stage asset for solid tumors and brings a target discovery platform to AbbVie's oncology portfolio, further enhancing the robustness of our pipeline."
Key Events from the Second Quarter
AbbVie Raises Full-Year 2016 Outlook
AbbVie is issuing GAAP diluted EPS guidance for the full-year 2016 of $3.82 to $3.92 . AbbVie is raising its adjusted diluted EPS guidance for the full-year 2016 to $4.73 to $4.83 from $4.62 to $4.82 , reflecting strong underlying business performance year-to-date and the expected continued positive trends over the remainder of the year. This updated guidance represents 11.4 percent growth at the midpoint versus 2015, and includes the dilutive impact of the Stemcentrx and Boehringer Ingelheim transactions. The company's 2016 adjusted diluted EPS guidance excludes $0.91 per share of intangible asset amortization expense, acquisition related costs and accounting impacts, the impact of the Venezuelan currency devaluation, and other specified items.
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.
AbbVie will host an investor conference call today at 8:00 a.m. Central time to discuss our second-quarter performance. The call will be webcast through AbbVie's Investor Relations website 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 2015 and 2016 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 are, or may be considered, 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, 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," of AbbVie's 2015 Annual Report on Form 10-K, which has 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 June 30, 2016 (Unaudited) |
| | | % Change vs. 2Q15 |
| | Net Revenues (in millions) | | International | Total |
| | U.S. | Int'l. | Total | U.S. | Operational | Reported | Operational | Reported |
| ADJUSTED NET REVENUES | $4,100 a | $2,332 | $6,432 a | 21.7% a | 12.1% | 10.8% | 18.0% a | 17.5% a |
| Humira | 2,712 | 1,437 | 4,149 | 26.7 | 4.0 | 3.0 | 17.7 | 17.4 |
| Imbruvica | 384 | 55 b | 439 | >100.0 | >100.0 | >100.0 | >100.0 | >100.0 |
| Viekira | 87 | 332 | 419 | (61.4) | >100.0 | >100.0 | 8.2 | 9.1 |
| Lupron | 179 | 40 | 219 | 14.6 | (1.4) | (5.3) | 11.2 | 10.4 |
| Synagis | -- | 45 | 45 | n/a | 8.3 | (2.6) | 8.3 | (2.6) |
| Synthroid | 188 | -- | 188 | 1.1 | n/a | n/a | 1.1 | 1.1 |
| Creon | 180 | -- | 180 | 12.9 | n/a | n/a | 12.9 | 12.9 |
| AndroGel | 171 | -- | 171 | 1.0 | n/a | n/a | 1.0 | 1.0 |
| Kaletra | 30 | 116 | 146 | (30.4) | 1.0 | (6.0) | (7.2) | (12.4) |
| Sevoflurane | 22 | 92 | 114 | 6.5 | (1.9) | (5.8) | (0.6) | (3.8) |
| Duodopa | 9 | 64 | 73 | >100.0 | 18.2 | 20.8 | 28.7 | 31.2 |
| Note: "Operational" growth reflects the percentage change over the prior year excluding the impact of exchange rate fluctuations. |
| n/a = not applicable |
| a U.S. and total net revenues for the quarter ended June 30, 2016 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 Six Months Ended June 30, 2016 (Unaudited) |
| | | % Change vs. 6M15 |
| | Net Revenues (in millions) | | International | Total |
| | U.S. | Int'l. | Total | U.S. | Operational | Reported | Operational | Reported |
| ADJUSTED NET REVENUES | $7,594 a | $4,796 | $12,390 a | 26.2% a | 12.0% | 6.7% | 20.1% a | 17.8% a |
| Humira | 4,907 | 2,819 | 7,726 | 29.0 | 4.3 | (0.8) | 18.4 | 16.2 |
| Imbruvica | 709 | 111 | 820 | >100.0 | >100.0 | >100.0 | >100.0 | >100.0 |
| Viekira | 212 | 621 | 833 | (41.7) | >100.0 | >100.0 | 37.7 | 35.4 |
| Lupron | 330 | 79 | 409 | 8.0 | 1.0 | (6.4) | 6.5 | 4.9 |
| Synagis | -- | 364 | 364 | n/a | 2.8 | (4.4) | 2.8 | (4.4) |
| Synthroid | 370 | -- | 370 | (0.7) | n/a | n/a | (0.7) | (0.7) |
| Creon | 330 | -- | 330 | 15.2 | n/a | n/a | 15.2 | 15.2 |
| AndroGel | 327 | -- | 327 | 1.5 | n/a | n/a | 1.5 | 1.5 |
| Kaletra | 63 | 216 | 279 | (25.2) | (9.5) | (17.6) | (13.3) | (19.5) |
| Sevoflurane | 39 | 186 | 225 | 2.7 | (4.2) | (9.9) | (3.1) | (7.9) |
| Duodopa | 16 | 125 | 141 | >100.0 | 20.9 | 18.7 | 32.6 | 30.5 |
| Note: "Operational" growth reflects the percentage change over the prior year excluding the impact of exchange rate fluctuations. |
| n/a = not applicable |
| a U.S. and total net revenues for the six months ended June 30, 2016 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. Consolidated Statements of Earnings Quarter and Six Months Ended June 30, 2016 and 2015 (Unaudited) (In millions, except per share data) |
| | Second Quarter Ended June 30 | | Six Months Ended June 30 | |
| | 2016 | | 2015 | | 2016 | | 2015 | |
| Net revenues | $6,452 | | $5,475 | | $12,410 | | $10,515 | |
| Cost of products sold | 1,405 | | 916 | | 2,774 | | 1,858 | |
| Selling, general and administrative | 1,466 | | 1,703 | | 2,821 | | 3,176 | |
| Research and development | 1,124 | | 981 | | 2,070 | | 1,792 | |
| Acquired in-process research and development | 70 | | 23 | | 80 | | 150 | |
| Total operating cost and expenses | 4,065 | | 3,623 | | 7,745 | | 6,976 | |
| Operating earnings | 2,387 | | 1,852 | | 4,665 | | 3,539 | |
| Interest expense, net | 225 | | 164 | | 425 | | 290 | |
| Net foreign exchange loss | 15 | | 14 | | 317 | | 178 | |
| Other expense (income), net | 51 | | (4) | | 51 | | (3) | |
| Earnings before income tax expense | 2,096 | | 1,678 | | 3,872 | | 3,074 | |
| Income tax expense | 486 | | 312 | | 908 | | 686 | |
| Net earnings | $1,610 | | $1,366 | | $2,964 | | $2,388 | |
| Diluted earnings per share | $0.98 | | $0.83 | | $1.81 | | $1.47 | |
| Diluted earnings per share, excluding specified items a | $1.26 | | $1.08 | | $2.41 | | $2.03 | |
| Weighted-average diluted shares outstanding | 1,632 | | 1,633 | | 1,629 | | 1,621 | |
| AbbVie Inc. Reconciliation of GAAP Reported to Non-GAAP Adjusted Information Quarter Ended June 30, 2016 (Unaudited) (In millions, except per share data) |
| 1. Specified items impacted results as follows: |
| | 2Q16 |
| | Earnings | Diluted |
| | Pre-tax | After-tax | EPS |
| As reported (GAAP) | $2,096 | $1,610 | $0.98 |
| Adjusted for specified items: | | | |
| Intangible asset amortization | 181 | 144 | 0.09 |
| Milestones and other R&D expenses | 55 | 55 | 0.03 |
| Acquired IPR&D | 70 | 70 | 0.04 |
| Acquisition related costs | 145 | 122 | 0.08 |
| Change in fair value of contingent consideration | 41 | 41 | 0.02 |
| Other | 4 | 30 | 0.02 |
| As adjusted (non-GAAP) | $2,592 | $2,072 | $1.26 |
| 2. The impact of the specified items by line item was as follows: |
| | 2Q16 |
| | Net revenues | Cost of products sold | SG&A | R&D | Acquired IPR&D | Other expense, net |
| As reported (GAAP) | $6,452 | $1,405 | $1,466 | $1,124 | $70 | $51 |
| Adjusted for specified items: | | | | | | |
| Intangible asset amortization | -- | (181) | -- | -- | -- | -- |
| Milestones and other R&D expenses | -- | -- | -- | (55) | -- | -- |
| Acquired IPR&D | -- | -- | -- | -- | (70) | -- |
| Acquisition related costs | -- | (46) | (15) | (72) | -- | (12) |
| Change in fair value of contingent consideration | -- | -- | -- | -- | -- | (41) |
| Other | (20) | (9) | (15) | -- | -- | -- |
| As adjusted (non-GAAP) | $6,432 | $1,169 | $1,436 | $997 | $-- | ($2) |
| 3. The adjusted tax rate for the second quarter of 2016 was 20.1 percent, as detailed below: |
| | 2Q16 |
| | Pre-tax | Income | |
| | income | taxes | Tax rate |
| As reported (GAAP) | $2,096 | $486 | 23.2% |
| Specified items | 496 | 34 | 6.9% |
| As adjusted (non-GAAP) | $2,592 | $520 | 20.1% |
| AbbVie Inc. Reconciliation of GAAP Reported to Non-GAAP Adjusted Information Quarter Ended June 30, 2015 (Unaudited) (In millions, except per share data) |
| 1. Specified items impacted results as follows: |
| | 2Q15 |
| | Earnings | Diluted |
| | Pre-tax | After-tax | EPS |
| As reported (GAAP) | $1,678 | $1,366 | $0.83 |
| Adjusted for specified items: | | | |
| Intangible asset amortization | 86 | 66 | 0.04 |
| Separation costs | 95 | 80 | 0.05 |
| Acquired IPR&D | 23 | 23 | 0.01 |
| Pharmacyclics acquisition related costs | 359 | 215 | 0.13 |
| Other | 34 | 26 | 0.02 |
| As adjusted (non-GAAP) | $2,275 | $1,776 | $1.08 |
| 2. The impact of the specified items by line item was as follows: |
| | 2Q15 |
| | Cost of products sold | SG&A | R&D | Acquired IPR&D | Interest expense, net |
| As reported (GAAP) | $916 | $1,703 | $981 | $23 | $164 |
| Adjusted for specified items: | | | | | |
| Intangible asset amortization | (86) | -- | -- | -- | -- |
| Separation costs | (2) | (93) | -- | -- | -- |
| Acquired IPR&D | -- | -- | -- | (23) | -- |
| Pharmacyclics acquisition related costs | (19) | (220) | (93) | -- | (27) |
| Other | (3) | (15) | (16) | -- | -- |
| As adjusted (non-GAAP) | $806 | $1,375 | $872 | -- | $137 |
| 3. The adjusted tax rate for the second quarter of 2015 was 21.9 percent, as detailed below: |
| | 2Q15 |
| | Pre-tax | Income | |
| | income | taxes | Tax rate |
| As reported (GAAP) | $1,678 | $312 | 18.6% |
| Specified items | 597 | 187 | 31.3% |
| As adjusted (non-GAAP) | $2,275 | $499 | 21.9% |
| AbbVie Inc. Reconciliation of GAAP Reported to Non-GAAP Adjusted Information Six Months Ended June 30, 2016 (Unaudited) (In millions, except per share data) |
| 1. Specified items impacted results as follows: |
| | 6M16 |
| | Earnings | Diluted |
| | Pre-tax | After-tax | EPS |
| As reported (GAAP) | $3,872 | $2,964 | $1.81 |
| Adjusted for specified items: | | | |
| Intangible asset amortization | 346 | 277 | 0.17 |
| Milestones and other R&D expenses | 70 | 70 | 0.04 |
| Acquired IPR&D | 80 | 80 | 0.05 |
| Acquisition related costs | 204 | 159 | 0.11 |
| Change in fair value of contingent consideration | 41 | 41 | 0.02 |
| Foreign exchange loss | 298 | 298 | 0.18 |
| Other | 44 | 57 | 0.03 |
| As adjusted (non-GAAP) | $4,955 | $3,946 | $2.41 |
| 2. The impact of the specified items by line item was as follows: |
| | 6M16 |
| | Net revenues | Cost of products sold | SG&A | R&D | Acquired IPR&D | Net foreign exchange loss | Other expense, net |
| As reported (GAAP) | $12,410 | $2,774 | $2,821 | $2,070 | $80 | $317 | $51 |
| Adjusted for specified items: | | | | | | | |
| Intangible asset amortization | -- | (346) | -- | -- | -- | -- | -- |
| Milestones and other R&D expenses | -- | -- | -- | (70) | -- | -- | -- |
| Acquired IPR&D | -- | -- | -- | -- | (80) | -- | -- |
| Acquisition related costs | -- | (91) | (20) | (81) | -- | -- | (12) |
| Change in fair value of contingent consideration | -- | -- | -- | -- | -- | -- | (41) |
| Venezuela devaluation loss | -- | -- | -- | -- | -- | (298) | -- |
| Other | (20) | (53) | (18) | 7 | -- | -- | -- |
| As adjusted (non-GAAP) | $12,390 | $2,284 | $2,783 | $1,926 | $-- | $19 | ($2) |
| 3. The adjusted tax rate for the first half of 2016 was 20.4 percent, as detailed below: |
| | 6M16 |
| | Pre-tax | Income | |
| | income | taxes | Tax rate |
| As reported (GAAP) | $3,872 | $908 | 23.4% |
| Specified items | 1,083 | 101 | 9.4% |
| As adjusted (non-GAAP) | $4,955 | $1,009 | 20.4% |
| AbbVie Inc. Reconciliation of GAAP Reported to Non-GAAP Adjusted Information Six Months Ended June 30, 2015 (Unaudited) (In millions, except per share data) |
| 1. Specified items impacted results as follows: |
| | 6M15 |
| | Earnings | Diluted |
| | Pre-tax | After-tax | EPS |
| As reported (GAAP) | $3,074 | $2,388 | $1.47 |
| Adjusted for specified items: | | | |
| Intangible asset amortization | 154 | 118 | 0.07 |
| Separation costs | 199 | 169 | 0.10 |
| Acquired IPR&D | 150 | 150 | 0.09 |
| Pharmacyclics acquisition related costs | 420 | 256 | 0.16 |
| Shire termination | 170 | 170 | 0.10 |
| Other | 68 | 49 | 0.04 |
| As adjusted (non-GAAP) | $4,235 | $3,300 | $2.03 |
| 2. The impact of the specified items by line item was as follows: |
| | 6M15 |
| | Cost of products sold | SG&A | R&D | Acquired IPR&D | Interest expense, net | Net foreign exchange loss |
| As reported (GAAP) | $1,858 | $3,176 | $1,792 | $150 | $290 | $178 |
| Adjusted for specified items: | | | | | | |
| Intangible asset amortization | (154) | -- | -- | -- | -- | -- |
| Separation costs | (5) | (194) | -- | -- | -- | -- |
| Acquired IPR&D | -- | -- | -- | (150) | -- | -- |
| Pharmacyclics acquisition related costs | (19) | (222) | (93) | -- | (86) | -- |
| Shire termination | -- | -- | -- | -- | -- | (170) |
| Other | (12) | (40) | (16) | -- | -- | -- |
| As adjusted (non-GAAP) | $1,668 | $2,720 | $1,683 | -- | $204 | $8 |
| 3. The adjusted tax rate for the first half of 2015 was 22.1 percent, as detailed below: |
| | 6M15 |
| | Pre-tax | Income | |
| | income | taxes | Tax rate |
| As reported (GAAP) | $3,074 | $686 | 22.3% |
| Specified items | 1,161 | 249 | 21.4% |
| As adjusted (non-GAAP) | $4,235 | $935 | 22.1% |
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Key Events from the Second Quarter
AbbVie Raises Full-Year 2016 Outlook
AbbVie is issuing GAAP diluted EPS guidance for the full-year 2016 of $3.82 to $3.92 . AbbVie is raising its adjusted diluted EPS guidance for the full-year 2016 to $4.73 to $4.83 from $4.62 to $4.82 , reflecting strong underlying business performance year-to-date and the expected continued positive trends over the remainder of the year. This updated guidance represents 11.4 percent growth at the midpoint versus 2015, and includes the dilutive impact of the Stemcentrx and Boehringer Ingelheim transactions. The company's 2016 adjusted diluted EPS guidance excludes $0.91 per share of intangible asset amortization expense, acquisition related costs and accounting impacts, the impact of the Venezuelan currency devaluation, and other specified items.
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.
AbbVie will host an investor conference call today at 8:00 a.m. Central time to discuss our second-quarter performance. The call will be webcast through AbbVie's Investor Relations website 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 2015 and 2016 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 are, or may be considered, 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, 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," of AbbVie's 2015 Annual Report on Form 10-K, which has 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 June 30, 2016 (Unaudited) |
| | | % Change vs. 2Q15 |
| | Net Revenues (in millions) | | International | Total |
| | U.S. | Int'l. | Total | U.S. | Operational | Reported | Operational | Reported |
| ADJUSTED NET REVENUES | $4,100 a | $2,332 | $6,432 a | 21.7% a | 12.1% | 10.8% | 18.0% a | 17.5% a |
| Humira | 2,712 | 1,437 | 4,149 | 26.7 | 4.0 | 3.0 | 17.7 | 17.4 |
| Imbruvica | 384 | 55 b | 439 | >100.0 | >100.0 | >100.0 | >100.0 | >100.0 |
| Viekira | 87 | 332 | 419 | (61.4) | >100.0 | >100.0 | 8.2 | 9.1 |
| Lupron | 179 | 40 | 219 | 14.6 | (1.4) | (5.3) | 11.2 | 10.4 |
| Synagis | -- | 45 | 45 | n/a | 8.3 | (2.6) | 8.3 | (2.6) |
| Synthroid | 188 | -- | 188 | 1.1 | n/a | n/a | 1.1 | 1.1 |
| Creon | 180 | -- | 180 | 12.9 | n/a | n/a | 12.9 | 12.9 |
| AndroGel | 171 | -- | 171 | 1.0 | n/a | n/a | 1.0 | 1.0 |
| Kaletra | 30 | 116 | 146 | (30.4) | 1.0 | (6.0) | (7.2) | (12.4) |
| Sevoflurane | 22 | 92 | 114 | 6.5 | (1.9) | (5.8) | (0.6) | (3.8) |
| Duodopa | 9 | 64 | 73 | >100.0 | 18.2 | 20.8 | 28.7 | 31.2 |
| Note: "Operational" growth reflects the percentage change over the prior year excluding the impact of exchange rate fluctuations. |
| n/a = not applicable |
| a U.S. and total net revenues for the quarter ended June 30, 2016 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 Six Months Ended June 30, 2016 (Unaudited) |
| | | % Change vs. 6M15 |
| | Net Revenues (in millions) | | International | Total |
| | U.S. | Int'l. | Total | U.S. | Operational | Reported | Operational | Reported |
| ADJUSTED NET REVENUES | $7,594 a | $4,796 | $12,390 a | 26.2% a | 12.0% | 6.7% | 20.1% a | 17.8% a |
| Humira | 4,907 | 2,819 | 7,726 | 29.0 | 4.3 | (0.8) | 18.4 | 16.2 |
| Imbruvica | 709 | 111 | 820 | >100.0 | >100.0 | >100.0 | >100.0 | >100.0 |
| Viekira | 212 | 621 | 833 | (41.7) | >100.0 | >100.0 | 37.7 | 35.4 |
| Lupron | 330 | 79 | 409 | 8.0 | 1.0 | (6.4) | 6.5 | 4.9 |
| Synagis | -- | 364 | 364 | n/a | 2.8 | (4.4) | 2.8 | (4.4) |
| Synthroid | 370 | -- | 370 | (0.7) | n/a | n/a | (0.7) | (0.7) |
| Creon | 330 | -- | 330 | 15.2 | n/a | n/a | 15.2 | 15.2 |
| AndroGel | 327 | -- | 327 | 1.5 | n/a | n/a | 1.5 | 1.5 |
| Kaletra | 63 | 216 | 279 | (25.2) | (9.5) | (17.6) | (13.3) | (19.5) |
| Sevoflurane | 39 | 186 | 225 | 2.7 | (4.2) | (9.9) | (3.1) | (7.9) |
| Duodopa | 16 | 125 | 141 | >100.0 | 20.9 | 18.7 | 32.6 | 30.5 |
| Note: "Operational" growth reflects the percentage change over the prior year excluding the impact of exchange rate fluctuations. |
| n/a = not applicable |
| a U.S. and total net revenues for the six months ended June 30, 2016 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. Consolidated Statements of Earnings Quarter and Six Months Ended June 30, 2016 and 2015 (Unaudited) (In millions, except per share data) |
| | Second Quarter Ended June 30 | | Six Months Ended June 30 | |
| | 2016 | | 2015 | | 2016 | | 2015 | |
| Net revenues | $6,452 | | $5,475 | | $12,410 | | $10,515 | |
| Cost of products sold | 1,405 | | 916 | | 2,774 | | 1,858 | |
| Selling, general and administrative | 1,466 | | 1,703 | | 2,821 | | 3,176 | |
| Research and development | 1,124 | | 981 | | 2,070 | | 1,792 | |
| Acquired in-process research and development | 70 | | 23 | | 80 | | 150 | |
| Total operating cost and expenses | 4,065 | | 3,623 | | 7,745 | | 6,976 | |
| Operating earnings | 2,387 | | 1,852 | | 4,665 | | 3,539 | |
| Interest expense, net | 225 | | 164 | | 425 | | 290 | |
| Net foreign exchange loss | 15 | | 14 | | 317 | | 178 | |
| Other expense (income), net | 51 | | (4) | | 51 | | (3) | |
| Earnings before income tax expense | 2,096 | | 1,678 | | 3,872 | | 3,074 | |
| Income tax expense | 486 | | 312 | | 908 | | 686 | |
| Net earnings | $1,610 | | $1,366 | | $2,964 | | $2,388 | |
| Diluted earnings per share | $0.98 | | $0.83 | | $1.81 | | $1.47 | |
| Diluted earnings per share, excluding specified items a | $1.26 | | $1.08 | | $2.41 | | $2.03 | |
| Weighted-average diluted shares outstanding | 1,632 | | 1,633 | | 1,629 | | 1,621 | |
| AbbVie Inc. Reconciliation of GAAP Reported to Non-GAAP Adjusted Information Quarter Ended June 30, 2016 (Unaudited) (In millions, except per share data) |
| 1. Specified items impacted results as follows: |
| | 2Q16 |
| | Earnings | Diluted |
| | Pre-tax | After-tax | EPS |
| As reported (GAAP) | $2,096 | $1,610 | $0.98 |
| Adjusted for specified items: | | | |
| Intangible asset amortization | 181 | 144 | 0.09 |
| Milestones and other R&D expenses | 55 | 55 | 0.03 |
| Acquired IPR&D | 70 | 70 | 0.04 |
| Acquisition related costs | 145 | 122 | 0.08 |
| Change in fair value of contingent consideration | 41 | 41 | 0.02 |
| Other | 4 | 30 | 0.02 |
| As adjusted (non-GAAP) | $2,592 | $2,072 | $1.26 |
| 2. The impact of the specified items by line item was as follows: |
| | 2Q16 |
| | Net revenues | Cost of products sold | SG&A | R&D | Acquired IPR&D | Other expense, net |
| As reported (GAAP) | $6,452 | $1,405 | $1,466 | $1,124 | $70 | $51 |
| Adjusted for specified items: | | | | | | |
| Intangible asset amortization | -- | (181) | -- | -- | -- | -- |
| Milestones and other R&D expenses | -- | -- | -- | (55) | -- | -- |
| Acquired IPR&D | -- | -- | -- | -- | (70) | -- |
| Acquisition related costs | -- | (46) | (15) | (72) | -- | (12) |
| Change in fair value of contingent consideration | -- | -- | -- | -- | -- | (41) |
| Other | (20) | (9) | (15) | -- | -- | -- |
| As adjusted (non-GAAP) | $6,432 | $1,169 | $1,436 | $997 | $-- | ($2) |
| 3. The adjusted tax rate for the second quarter of 2016 was 20.1 percent, as detailed below: |
| | 2Q16 |
| | Pre-tax | Income | |
| | income | taxes | Tax rate |
| As reported (GAAP) | $2,096 | $486 | 23.2% |
| Specified items | 496 | 34 | 6.9% |
| As adjusted (non-GAAP) | $2,592 | $520 | 20.1% |
| AbbVie Inc. Reconciliation of GAAP Reported to Non-GAAP Adjusted Information Quarter Ended June 30, 2015 (Unaudited) (In millions, except per share data) |
| 1. Specified items impacted results as follows: |
| | 2Q15 |
| | Earnings | Diluted |
| | Pre-tax | After-tax | EPS |
| As reported (GAAP) | $1,678 | $1,366 | $0.83 |
| Adjusted for specified items: | | | |
| Intangible asset amortization | 86 | 66 | 0.04 |
| Separation costs | 95 | 80 | 0.05 |
| Acquired IPR&D | 23 | 23 | 0.01 |
| Pharmacyclics acquisition related costs | 359 | 215 | 0.13 |
| Other | 34 | 26 | 0.02 |
| As adjusted (non-GAAP) | $2,275 | $1,776 | $1.08 |
| 2. The impact of the specified items by line item was as follows: |
| | 2Q15 |
| | Cost of products sold | SG&A | R&D | Acquired IPR&D | Interest expense, net |
| As reported (GAAP) | $916 | $1,703 | $981 | $23 | $164 |
| Adjusted for specified items: | | | | | |
| Intangible asset amortization | (86) | -- | -- | -- | -- |
| Separation costs | (2) | (93) | -- | -- | -- |
| Acquired IPR&D | -- | -- | -- | (23) | -- |
| Pharmacyclics acquisition related costs | (19) | (220) | (93) | -- | (27) |
| Other | (3) | (15) | (16) | -- | -- |
| As adjusted (non-GAAP) | $806 | $1,375 | $872 | -- | $137 |
| 3. The adjusted tax rate for the second quarter of 2015 was 21.9 percent, as detailed below: |
| | 2Q15 |
| | Pre-tax | Income | |
| | income | taxes | Tax rate |
| As reported (GAAP) | $1,678 | $312 | 18.6% |
| Specified items | 597 | 187 | 31.3% |
| As adjusted (non-GAAP) | $2,275 | $499 | 21.9% |
| AbbVie Inc. Reconciliation of GAAP Reported to Non-GAAP Adjusted Information Six Months Ended June 30, 2016 (Unaudited) (In millions, except per share data) |
| 1. Specified items impacted results as follows: |
| | 6M16 |
| | Earnings | Diluted |
| | Pre-tax | After-tax | EPS |
| As reported (GAAP) | $3,872 | $2,964 | $1.81 |
| Adjusted for specified items: | | | |
| Intangible asset amortization | 346 | 277 | 0.17 |
| Milestones and other R&D expenses | 70 | 70 | 0.04 |
| Acquired IPR&D | 80 | 80 | 0.05 |
| Acquisition related costs | 204 | 159 | 0.11 |
| Change in fair value of contingent consideration | 41 | 41 | 0.02 |
| Foreign exchange loss | 298 | 298 | 0.18 |
| Other | 44 | 57 | 0.03 |
| As adjusted (non-GAAP) | $4,955 | $3,946 | $2.41 |
| 2. The impact of the specified items by line item was as follows: |
| | 6M16 |
| | Net revenues | Cost of products sold | SG&A | R&D | Acquired IPR&D | Net foreign exchange loss | Other expense, net |
| As reported (GAAP) | $12,410 | $2,774 | $2,821 | $2,070 | $80 | $317 | $51 |
| Adjusted for specified items: | | | | | | | |
| Intangible asset amortization | -- | (346) | -- | -- | -- | -- | -- |
| Milestones and other R&D expenses | -- | -- | -- | (70) | -- | -- | -- |
| Acquired IPR&D | -- | -- | -- | -- | (80) | -- | -- |
| Acquisition related costs | -- | (91) | (20) | (81) | -- | -- | (12) |
| Change in fair value of contingent consideration | -- | -- | -- | -- | -- | -- | (41) |
| Venezuela devaluation loss | -- | -- | -- | -- | -- | (298) | -- |
| Other | (20) | (53) | (18) | 7 | -- | -- | -- |
| As adjusted (non-GAAP) | $12,390 | $2,284 | $2,783 | $1,926 | $-- | $19 | ($2) |
| 3. The adjusted tax rate for the first half of 2016 was 20.4 percent, as detailed below: |
| | 6M16 |
| | Pre-tax | Income | |
| | income | taxes | Tax rate |
| As reported (GAAP) | $3,872 | $908 | 23.4% |
| Specified items | 1,083 | 101 | 9.4% |
| As adjusted (non-GAAP) | $4,955 | $1,009 | 20.4% |
| AbbVie Inc. Reconciliation of GAAP Reported to Non-GAAP Adjusted Information Six Months Ended June 30, 2015 (Unaudited) (In millions, except per share data) |
| 1. Specified items impacted results as follows: |
| | 6M15 |
| | Earnings | Diluted |
| | Pre-tax | After-tax | EPS |
| As reported (GAAP) | $3,074 | $2,388 | $1.47 |
| Adjusted for specified items: | | | |
| Intangible asset amortization | 154 | 118 | 0.07 |
| Separation costs | 199 | 169 | 0.10 |
| Acquired IPR&D | 150 | 150 | 0.09 |
| Pharmacyclics acquisition related costs | 420 | 256 | 0.16 |
| Shire termination | 170 | 170 | 0.10 |
| Other | 68 | 49 | 0.04 |
| As adjusted (non-GAAP) | $4,235 | $3,300 | $2.03 |
| 2. The impact of the specified items by line item was as follows: |
| | 6M15 |
| | Cost of products sold | SG&A | R&D | Acquired IPR&D | Interest expense, net | Net foreign exchange loss |
| As reported (GAAP) | $1,858 | $3,176 | $1,792 | $150 | $290 | $178 |
| Adjusted for specified items: | | | | | | |
| Intangible asset amortization | (154) | -- | -- | -- | -- | -- |
| Separation costs | (5) | (194) | -- | -- | -- | -- |
| Acquired IPR&D | -- | -- | -- | (150) | -- | -- |
| Pharmacyclics acquisition related costs | (19) | (222) | (93) | -- | (86) | -- |
| Shire termination | -- | -- | -- | -- | -- | (170) |
| Other | (12) | (40) | (16) | -- | -- | -- |
| As adjusted (non-GAAP) | $1,668 | $2,720 | $1,683 | -- | $204 | $8 |
| 3. The adjusted tax rate for the first half of 2015 was 22.1 percent, as detailed below: |
| | 6M15 |
| | Pre-tax | Income | |
| | income | taxes | Tax rate |
| As reported (GAAP) | $3,074 | $686 | 22.3% |
| Specified items | 1,161 | 249 | 21.4% |
| As adjusted (non-GAAP) | $4,235 | $935 | 22.1% |
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