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|November 02, 2017 7:01 a.m.|
|Teva Reports Third Quarter 2017 Financial Results|
Revenues in the third quarter of 2017 were
Exchange rate differences between the third quarter of 2017 and
the third quarter of 2016 reduced revenues by
Adjustments of the exchange rates used for the Venezuelan bolivar
resulted in a decrease of
GAAP gross profit was
Research and Development (R&D) expenses for the third quarter
of 2017 amounted to
Selling and Marketing (S&M) expenses in the third quarter of
2017 amounted to
General and Administrative (G&A) expenses in the third
quarter of 2017 amounted to
GAAP operating income in the third quarter of 2017 was
EBITDA (non-GAAP operating income, which excludes amortization
and certain other items, as well as excluding depreciation expenses) was
GAAP financial expenses for the third quarter of 2017 were
GAAP income taxes for the third quarter of 2017 amounted to a
We expect our annual non-GAAP tax rate for 2017 to be 15%, lower than our previous estimates. This is due to changes in the geographical mix of income we expect to generate this year. Our non-GAAP tax rate for 2016 was 17%.
GAAP net income attributable to ordinary shareholders and GAAP
diluted EPS were
For the third quarter of 2017, the weighted average outstanding
shares for the fully diluted earnings per share calculation on both
a GAAP and a non-GAAP basis was 1,017 million. For the third quarter of
2016, this was 984 million shares on a GAAP basis, and 1,044 million
shares on a non-GAAP basis. For the three months ended
Non-GAAP information: Net non-GAAP adjustments in the third
quarter of 2017 were
Teva believes that excluding such items facilitates investors' understanding of its business. 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 replacement for, or superior to, measures of financial performance prepared in accordance with GAAP.
Cash flow from operations generated during the third quarter of
Free cash flow, excluding net capital expenditures, was
Total balance sheet assets amounted to
Total shareholders’ equity was
Segment Results for the Third Quarter 2017
Beginning in the fourth quarter of 2016, our OTC business, conducted primarily through PGT, is included in our generic medicines segment. This segment also includes chemical and therapeutic equivalents of originator medicines in a variety of dosage forms and our API manufacturing business.
All data presented has been conformed to the new segment structure.
Generic Medicines Segment
Generic Medicines Revenues
Generic medicines revenues in the third quarter of 2017 were
Generic revenues consisted of:
Generic medicines revenues comprised 54% of our total revenues in the quarter, compared to 59% in the third quarter of 2016.
Generic Medicines Gross Profit
Gross profit of our generic medicines segment in the third quarter of
Gross profit margin for our generic medicines segment in the third quarter of 2017 decreased to 38.5% from 48.8% in the third quarter of 2016.
The decrease in gross profit margin was due to lower profitability in our U.S. and ROW markets, partially offset by improved profitability of our European markets.
Generic Medicines Profit
Our generic medicines segment generated profit of
Specialty Medicines Segment
Specialty Medicines Revenues
Specialty medicines revenues in the third quarter of 2017 were
Specialty medicines revenues comprised 36% of our total revenues in the quarter, compared to 37% in the third quarter of 2016.
The decrease in specialty medicines revenues compared to the third quarter of 2016 was primarily due to lower sales of our CNS products, which were largely offset by higher sales in all other therapeutic areas.
The following table presents revenues by therapeutic area and key
products for our specialty medicines segment for the three months ended
Global revenues of Copaxone® (20 mg/mL and 40
mg/mL), the leading multiple sclerosis therapy in the U.S. and globally,
Copaxone® revenues in
Copaxone® revenues outside
Our global Azilect® revenues were
Revenues of our respiratory products were
Revenues of our oncology products were
Specialty Medicines Gross Profit
Gross profit of our specialty medicines segment was
Specialty Medicines Profit
Our specialty medicines segment profit was
Specialty medicines profit as a percentage of segment revenues was 56.6% in the third quarter of 2017, compared to 53.6% in the third quarter of 2016.
The increase in profit and profitability was driven by lower S&M and R&D expenses, partially offset by lower gross profit.
The following tables present details of our multiple sclerosis franchise
and of our other specialty medicines for the three months ended
Other revenues (primarily sales of third-party products for which
we act as distributor, mostly in
Revenues from these other activities comprised 10% of our total revenues in the quarter, compared to 5% in the third quarter of 2016.
Updated 2017 Financial Outlook
Our 2017 financial outlook was lowered to reflect the following:
These estimates reflect management's current expectations for Teva's performance in 2017. Actual results may vary, whether as a result of exchange rate differences, market conditions or other factors. In addition, the non-GAAP measures exclude the amortization of purchased intangible assets, costs related to certain regulatory actions, inventory step-up, legal settlements and reserves, impairments and related tax effects.
Teva will host a conference call and live webcast along with a slide
In order to participate, please dial the following numbers (at least 10
minutes before the scheduled start time):
A live webcast of the call will also be available on Teva's website at: www.ir.tevapharm.com. Please log in at least 10 minutes prior to the conference call in order to download the applicable audio software.
Following the conclusion of the call, a replay of the webcast will be
available within 24 hours on the Company's website. The replay can also
be accessed until
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:
and other factors discussed in our Annual Report on Form 20-F for the
Teva Pharmaceutical Industries Ltd.