PFIZER, INC. Fourth-Quarter 2015 Reported Revenues(1) of $14.0 Billion, Reflecting 14% Operational Growth Driven by 22% Operational Growth from the Innovative Products Business
Full-Year 2015 Reported Revenues(1) of $48.9 Billion, Reflecting 6% Operational Growth Driven by 19% Operational Growth from the Innovative Products Business
Fourth-Quarter 2015 Adjusted Diluted EPS(2) of $0.53 and Reported Diluted EPS(1) of $0.10; Full-Year 2015 Adjusted Diluted EPS(2) of $2.20 and Reported Diluted EPS(1) of $1.24
Provides 2016 Financial Guidance
On September 3, 2015, Pfizer acquired Hospira, Inc. (Hospira). Consequently, and in accordance with Pfizer's domestic and international reporting periods(3), full-year financial results for the year ended December 31, 2015 reflect four months of legacy Hospira U.S. operations and three months of legacy Hospira international operations, while financial results from fourth-quarter 2014 and full-year 2014 do not include any contribution from legacy Hospira operations. Fourth-quarter 2015 includes three months of legacy Hospira global operations.
The Company manages its commercial operations through two distinct businesses: an Innovative Products business and an Established Products business. The Innovative Products business is composed of two operating segments: the Global Innovative Pharmaceutical segment (GIP)(4) and the Global Vaccines, Oncology and Consumer Healthcare segment (VOC)(4). The Established Products business consists of the Global Established Pharmaceutical segment (GEP)(4), which includes all legacy Hospira commercial operations. Financial results for each of these segments are presented in the Operating Segment Information section.
Some amounts in this press release may not add due to rounding. All percentages have been calculated using unrounded amounts. Results for fourth-quarter and full-year 2015 and 2014 are summarized below.
OVERALL RESULTS($ in millions, except
per share amounts) Fourth-Quarter Full-Year
2015 2014 Change 2015 2014 Change
Reported Revenues(1) | $ 14,047 | $ 13,118 | 7% | $ 48,851 | $ 49,605 | (2%) |
Adjusted Income(2) | 3,306 | 3,441 | (4%) | 13,755 | 14,530 | (5%) |
Adjusted Diluted EPS(2) | 0.53 | 0.54 | (2%) | 2.20 | 2.26 | (3%) |
Reported Net Income(1) | 613 | 1,228 | (50%) | 7,745 | 9,135 | (15%) |
Reported Diluted EPS(1) | 0.10 | 0.19 | (47%) | 1.24 | 1.42 | (13%) |
($ in millions)
Fourth-Quarter Full-Year
2015 2014 % Change 2015 2014 % Change Total Oper. Total Oper.
Innovative Products $ 7,637 $ 6,628 15% 22% $ 26,758 $ 24,005 11% 19%GIP(4) 3,862 3,748 3% 10% 13,954 13,861 1% 9%
Global Vaccines(4) | 1,917 | 1,318 | 45% | 53% | 6,454 | 4,480 | 44% | 51% |
Consumer Healthcare(4) | 930 | 953 | (2%) | 4% | 3,395 | 3,446 | (1%) | 5% |
Global Oncology(4) | 928 | 609 | 52% | 61% | 2,954 | 2,218 | 33% | 43% |
Established Products | $ 6,264 | $ 6,407 | (2%) | 5% | $ 21,587 | $ 25,149 | (14%) | (7%) |
GEP(4) Standalone | 5,082 | 6,407 | (21%) | (14%) | 20,075 | 25,149 | (20%) | (13%) |
Legacy Hospira | 1,182 | - | * | * | 1,513 | - | * | * |
Other(5) | 146 | 83 | 75% | 98% | 506 | 451 | 12% | 20% |
Total Company | $ 14,047 | $ 13,118 | 7% | 14% | $ 48,851 | $ 49,605 | (2%) | 6% |
Pfizer Excluding Legacy Hospira | $ 12,865 | $ 13,118 | (2%) | 5% | $ 47,339 | $ 49,605 | (5%) | 3% |
* Indicates calculation not meaningful.
($ in millions)
(Favorable)/Unfavorable Fourth-Quarter Full-Year
2015 | 2014 | % Change Total Oper. | 2015 | 2014 | % Change Total Oper. | |||
Cost of Sales(2) | $ 2,983 | $ 2,584 | 15% | 22% | $ 9,021 | $ 9,134 | (1%) | 10% |
Percent of Revenues(1) | 21.2% | 19.7% | N/A | N/A | 18.5% | 18.4% | N/A | N/A |
SI&A Expenses(2) | 4,598 | 3,916 | 17% | 24% | 14,324 | 13,721 | 4% | 11% |
R&D Expenses(2) | 2,318 | 2,039 | 14% | 16% | 7,653 | 7,153 | 7% | 9% |
Total | $ 9,900 | $ 8,539 | 16% | 21% | $ 30,998 | $ 30,007 | 3% | 10% |
Effective Tax Rate(2) 19.6% 26.2% 24.0% 26.5%
A reconciliation of Pfizer's full-year 2015 financial results to certain components of its 2016 financial guidance is below. For 2016, the financial guidance includes the estimated significant negative currency impact related to Venezuela and excludes any impact from the pending combination with Allergan plc (Allergan).
Full-Year 2015 Results | 2016 Financial Guidance at 2015 FX Rates | Impact of Mid- January 2016 FX Rates Compared to 2015 FX Rates (Ex Venezuela) | Currency Impact Related to Venezuela | 2016 Financial Guidance | |
Reported Revenues(1) | $48.9 billion | $51.3 to $53.3 billion | ($1.5 billion) | ($0.8 billion) | $49.0 to $51.0 billion |
Reported Diluted EPS(1) | $1.24 | $1.70 to $1.83 | ($0.09) | ($0.07) | $1.54 to $1.67 |
Adjusted Diluted EPS(2) | $2.20 | $2.36 to $2.46 | ($0.09) | ($0.07) | $2.20 to $2.30 |
Pfizer's complete 2016 financial guidance is summarized below.
Reported Revenues(1) | $49.0 to $51.0 billion |
Adjusted Cost of Sales(2) as a Percentage of Reported Revenues(1) | 21.0% to 22.0% |
Adjusted SI&A Expenses(2) | $13.2 to $14.2 billion |
Adjusted R&D Expenses(2) | $7.3 to $7.8 billion |
Adjusted Other (Income)/Deductions(2) | Approximately ($300 million) of income |
Effective Tax Rate on Adjusted Income(2) | Approximately 24.0% |
Reported Diluted EPS(1) | $1.54 to $1.67 |
Adjusted Diluted EPS(2) | $2.20 to $2.30 |
Ian Read, Chairman and Chief Executive Officer, stated, "The just completed year was very productive in terms of business momentum, pipeline advancement and business development activity. I am particularly pleased with the performance of our Prevnar 13 adult and Ibrance launches in the U.S. In addition, Eliquis, Xeljanz and the Hospira portfolio, among other assets, along with operational growth in emerging markets, meaningfully enhanced the strength of our businesses.
"I believe that we are well positioned to deliver another strong year in 2016 as we expect that our key in-line products will continue to perform well while we expect to advance our product pipeline, notably our potential registrational programs in key therapeutic areas such as oncology, vaccines, cardiovascular and metabolic diseases, inflammation and rare diseases."
Mr. Read continued, "The integration of Hospira is well underway and we now look forward to completing the combination with Allergan, which we still expect to occur during the second half of this year. We see this transaction as a very effective driver of accelerating the growth potential of our Innovative business, strengthening our Established business and more efficiently allocating our capital globally, all factors which remain consistent with our overarching strategy of value creation.
"I want to thank our colleagues for their continued tireless work in an environment, that while challenging, continues to be very rewarding for our stakeholders," Mr. Read concluded.
Frank D'Amelio, Chief Financial Officer, stated, "2015 was a truly transformational year for Pfizer. In addition to our strong financial performance, we completed the Hospira acquisition, announced the pending combination with Allergan and continued to deliver shareholder value through prudent capital allocation. Regarding our financial performance, we exceeded our 2015 financial guidance for reported revenue(1) and met the top end of our 2015 financial guidance range for adjusted diluted EPS(2) despite an operating environment that remains challenging. Importantly, Pfizer-standalone revenues increased 3% operationally, marking Pfizer's first year of
operational revenue growth since entering a period of significant product losses of exclusivity. We believe the completion of the Hospira acquisition and the pending Allergan combination will strengthen our core businesses and better position the Company for sustainable revenue growth in the future.
"Today we are also providing our 2016 financial guidance, including ranges for reported revenues(1) of $49.0 to
$51.0 billion and for adjusted diluted EPS(2) of $2.20 to $2.30. Our guidance for reported revenues(1) reflects anticipated mid-to-high-single digit operational revenue growth on an enterprise basis offset by the anticipated negative impact of $2.3 billion due to generic competition for products that recently lost or are expected to soon lose marketing exclusivity as well as $2.3 billion as a result of adverse changes in foreign exchange rates relative to the U.S. dollar compared to foreign exchange rates from last year, including $0.8 billion due to the estimated significant currency impact related to Venezuela. Our 2016 financial guidance excludes any impact from the pending combination with Allergan. Finally, our guidance for reported(1) and adjusted(2) diluted EPS also reflects anticipated share repurchases totaling $5 billion this year, consisting of our previously-announced plans to enter into a $5 billion accelerated share repurchase agreement that we expect to execute in the first half of 2016. These planned repurchases are expected to more than offset the potential dilution related to employee compensation programs," Mr. D'Amelio concluded.
Reported revenues(1) totaled $14.0 billion, an increase of $930 million, or 7%, which reflects operational growth of $1.9 billion, or 14%, partially offset by the unfavorable impact of foreign exchange of $934 million, or 7%. Excluding the impact of legacy Hospira operations of $1.2 billion, foreign exchange and, to a lesser extent, the vaccines acquired from Baxter International Inc. (Baxter) of $35 million, Pfizer-standalone revenues increased by $646 million operationally, or 5%.
Operational revenue growth in developed markets was driven primarily by the inclusion of $1.1 billion of revenues from legacy Hospira operations and continued strong performance of several key products, notably Prevnar 13 in adults and Ibrance in the U.S., Eliquis globally as well as Xeljanz and Lyrica primarily in the U.S. In emerging markets, revenues increased 5% operationally, favorably impacted by the addition of legacy Hospira operations, which contributed $73 million, as well as the performance of Prevenar 13 and certain other products.
Operational revenue growth was partially offset primarily by the loss of exclusivity and associated generic competition for Celebrex in the U.S. and certain other developed markets, Lyrica in certain developed Europe markets and Zyvox in the U.S.
Pfizer Inc. issued this content on 02 February 2016 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 02 February 2016 12:06:10 UTC
Original Document: http://www.pfizer.com/news/press-release/press-release-detail/pfizer_reports_fourth_quarter_and_full_year_2015_results_provides_2016_financial_guidance
