THOUSAND OAKS, Calif.,
April 26, 2017 /PRNewswire/
-- Amgen (NASDAQ:AMGN) today announced financial results for
the first quarter of 2017. Key results include:
- Total revenues decreased 1 percent versus the first quarter of
2016 to $5.5 billion.
- GAAP earnings per share (EPS) increased 12 percent to
$2.79 driven by higher operating
margins.
-
- GAAP operating income increased 8 percent to $2.6 billion and GAAP operating margin increased
4 percentage points to 49.8 percent.
- Non-GAAP EPS increased 9 percent to $3.15 driven by higher operating margins.
-
- Non-GAAP operating income increased 5 percent to $3.0 billion and non-GAAP operating margin
increased 3 percentage points to 57.6 percent.
- 2017 EPS guidance increased to $10.64-$11.32 on a GAAP basis and $12.00-$12.60 on a non-GAAP basis; total revenues
guidance unchanged at $22.3-$23.1
billion.
- The Company generated $2.2
billion of free cash flow in the first quarter versus
$1.8 billion in the first quarter of
2016.
"We are well positioned for the long term with our newer
products demonstrating volume growth around the world and our tight
operational expense management of the Company," said Robert A. Bradway, chairman and chief executive
officer. "With robust Repatha®
(evolocumab) outcomes data, we are working with payers to
improve access to this important therapy for patients at risk for
heart attacks and strokes."
$Millions, except EPS
and percentages
|
|
Q1'17
|
|
Q1'16
|
|
YOY
Δ
|
|
|
|
|
|
|
|
Total
Revenues
|
|
$ 5,464
|
|
$ 5,527
|
|
(1%)
|
GAAP Operating
Income
|
|
$ 2,591
|
|
$ 2,402
|
|
8%
|
GAAP Net
Income
|
|
$ 2,071
|
|
$ 1,900
|
|
9%
|
GAAP EPS
|
|
$
2.79
|
|
$
2.50
|
|
12%
|
Non-GAAP Operating
Income
|
|
$ 2,995
|
|
$ 2,859
|
|
5%
|
Non-GAAP Net
Income
|
|
$ 2,333
|
|
$ 2,203
|
|
6%
|
Non-GAAP
EPS
|
|
$
3.15
|
|
$
2.90
|
|
9%
|
|
References in this
release to "non-GAAP" measures, measures presented "on a non-GAAP
basis" and to "free cash flow" (computed by subtracting
capital expenditures from operating cash flow) refer to non-GAAP
financial measures. Adjustments to the most directly comparable
GAAP financial measures and other items are presented on the
attached reconciliations.
|
Product Sales Performance
- Total product sales decreased 1 percent for the first
quarter of 2017 versus the first quarter of 2016.
- Neulasta® (pegfilgrastim) sales increased 2
percent as favorable changes in accounting estimates and net
selling price were offset partially by lower unit demand.
- Enbrel® (etanercept) sales decreased 15
percent due to the impact of competition as well as lower
rheumatology and dermatology segment growth compared to prior
quarters.
- Aranesp® (darbepoetin alfa) sales decreased 4
percent as higher unit demand was more than offset by unfavorable
changes in foreign exchange rates, inventory and net selling
price.
- Prolia® (denosumab) sales increased 21
percent driven by higher unit demand.
- Sensipar/Mimpara® (cinacalcet) sales
increased 15 percent driven primarily by net selling price.
- XGEVA® (denosumab) sales increased 6 percent
driven by higher unit demand.
- EPOGEN® (epoetin alfa) sales decreased 10
percent driven by net selling price.
- KYPROLIS® (carfilzomib) sales increased 23
percent driven by higher unit demand.
- Nplate® (romiplostim) sales increased 9
percent driven by higher unit demand.
- NEUPOGEN® (filgrastim) sales decreased
31 percent driven primarily by the impact of competition.
- Vectibix® (panitumumab) sales increased 2
percent driven by higher unit demand, offset partially by
unfavorable changes in foreign exchange rates.
- Repatha sales increased driven by higher unit
demand.
- BLINCYTO® (blinatumomab) sales increased 26
percent driven by higher unit demand.
Product Sales
Detail by Product and Geographic Region
|
$Millions, except
percentages
|
|
Q1'17
|
|
Q1'16
|
|
YOY
Δ
|
|
|
US
|
ROW
|
TOTAL
|
|
TOTAL
|
|
TOTAL
|
|
|
|
|
|
|
|
|
|
Neulasta®
|
|
$1,048
|
$162
|
$1,210
|
|
$1,183
|
|
2%
|
Enbrel®
|
|
1,118
|
63
|
1,181
|
|
1,385
|
|
(15%)
|
Aranesp®
|
|
278
|
233
|
511
|
|
532
|
|
(4%)
|
Prolia®
|
|
279
|
146
|
425
|
|
352
|
|
21%
|
Sensipar®
/ Mimpara®
|
|
337
|
84
|
421
|
|
367
|
|
15%
|
XGEVA®
|
|
298
|
104
|
402
|
|
378
|
|
6%
|
EPOGEN®
|
|
270
|
0
|
270
|
|
300
|
|
(10%)
|
KYPROLIS®
|
|
137
|
53
|
190
|
|
154
|
|
23%
|
Nplate®
|
|
97
|
57
|
154
|
|
141
|
|
9%
|
NEUPOGEN®
|
|
101
|
47
|
148
|
|
213
|
|
(31%)
|
Vectibix®
|
|
61
|
86
|
147
|
|
144
|
|
2%
|
Repatha®
|
|
33
|
16
|
49
|
|
16
|
|
*
|
BLINCYTO®
|
|
23
|
11
|
34
|
|
27
|
|
26%
|
Other**
|
|
15
|
42
|
57
|
|
47
|
|
21%
|
|
|
|
|
|
|
|
|
|
Total product
sales
|
|
$4,095
|
$1,104
|
$5,199
|
|
$5,239
|
|
(1%)
|
|
|
|
|
|
|
|
|
|
* Change in excess of
100%
|
|
|
|
|
** Other includes
Bergamo, MN Pharma, IMLYGIC®and
Corlanor®
|
|
|
|
|
|
|
Operating Expense, Operating Margin and Tax Rate
Analysis
On a GAAP basis:
- Total Operating Expenses decreased 8 percent, with all
expense categories reflecting savings from our transformation and
process improvement efforts. Cost of Sales margin improved
by 0.2 percentage points driven primarily by manufacturing
efficiencies, offset partially by product mix. Research &
Development (R&D) expenses decreased 12 percent driven by a
payment in the first quarter of 2016 related to a third-party
collaboration agreement, as well as lower spending required to
support certain later-stage clinical programs. Selling, General
& Administrative (SG&A) expenses decreased 12 percent
due to the expiration of ENBREL residual royalty payments and an
acquisition charge in the first quarter of 2016, offset partially
by investments in product launches.
- Operating Margin improved by 4 percentage points to 49.8
percent.
- Tax Rate decreased 0.1 percentage points as changes in
the geographic mix of earnings were offset partially by lower tax
benefits from share-based compensation payments.
On a non-GAAP basis:
- Total Operating Expenses decreased 7 percent, with all
expense categories reflecting savings from our transformation and
process improvement efforts. Cost of Sales margin improved
by 0.4 percentage points driven primarily by manufacturing
efficiencies, offset partially by product mix. R&D
expenses decreased 13 percent driven by a payment in the first
quarter of 2016 related to a third-party collaboration agreement,
as well as lower spending required to support certain later-stage
clinical programs. SG&A expenses decreased 6 percent due
to the expiration of ENBREL residual royalty payments, offset
partially by investments in product launches.
- Operating Margin improved by 3 percentage points to 57.6
percent.
- Tax Rate decreased 0.4 percentage points as changes in
the geographic mix of earnings were offset partially by lower tax
benefits from share-based compensation payments.
$Millions, except
percentages
|
|
|
|
|
|
|
GAAP
|
|
Non-GAAP
|
|
|
|
Q1'17
|
|
Q1'16
|
|
YOY
Δ
|
|
Q1'17
|
|
Q1'16
|
|
YOY
Δ
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
Sales
|
$996
|
|
$1,018
|
|
(2%)
|
|
$682
|
|
$707
|
|
(4%)
|
|
% of product
sales
|
19.2%
|
|
19.4%
|
|
(0.2)pts
|
|
13.1%
|
|
13.5%
|
|
(0.4) pts
|
Research &
Development
|
$769
|
|
$872
|
|
(12%)
|
|
$748
|
|
$858
|
|
(13%)
|
|
% of product
sales
|
14.8%
|
|
16.6%
|
|
(1.8) pts
|
|
14.4%
|
|
16.4%
|
|
(2) pts
|
Selling, General
& Administrative
|
$1,064
|
|
$1,203
|
|
(12%)
|
|
$1,039
|
|
$1,103
|
|
(6%)
|
|
% of product
sales
|
20.5%
|
|
23.0%
|
|
(2.5) pts
|
|
20.0%
|
|
21.1%
|
|
(1.1) pts
|
Other
|
$44
|
|
$32
|
|
38%
|
|
$0
|
|
$0
|
|
NM
|
TOTAL Operating
Expenses
|
$2,873
|
|
$3,125
|
|
(8%)
|
|
$2,469
|
|
$2,668
|
|
(7%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Margin
|
|
|
|
|
|
|
|
|
|
|
|
|
operating income as a
% of product sales
|
49.8%
|
|
45.8%
|
|
4 pts
|
|
57.6%
|
|
54.6%
|
|
3 pts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax
Rate
|
15.8%
|
|
15.9%
|
|
(0.1)
pts
|
|
18.5%
|
|
18.9%
|
|
(0.4)
pts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NM: Not
Meaningful
pts: percentage points
|
Cash Flow and Balance Sheet
- The Company generated $2.2
billion of free cash flow in the first quarter of 2017
versus $1.8 billion in the first
quarter of 2016 driven by the timing of tax payments and higher net
income.
- The Company's second quarter 2017 dividend of $1.15 per share declared on March 7, 2017, will be paid on June 8, 2017, to all stockholders of record as of
May 17, 2017.
- During the first quarter, the Company repurchased 3.4 million
shares of common stock at a total cost of $555 million. At the end of the first quarter,
the Company had $3.5 billion
remaining under its stock repurchase authorization.
$Billions, except
shares
|
|
Q1'17
|
|
Q1'16
|
|
YOY
Δ
|
|
|
|
|
|
|
|
|
|
Operating Cash
Flow
|
$2.4
|
|
$1.9
|
|
$0.5
|
Capital
Expenditures
|
0.2
|
|
0.2
|
|
0.0
|
Free Cash
Flow
|
2.2
|
|
1.8
|
|
0.5
|
Dividends
Paid
|
0.8
|
|
0.8
|
|
0.1
|
Share
Repurchase
|
0.6
|
|
0.7
|
|
(0.1)
|
Avg. Diluted Shares
(millions)
|
741
|
|
760
|
|
(19)
|
|
|
|
|
|
|
|
|
|
Cash and
Investments
|
38.4
|
|
34.7
|
|
3.7
|
Debt
Outstanding
|
34.1
|
|
34.3
|
|
(0.2)
|
Stockholders'
Equity
|
30.6
|
|
28.7
|
|
2.0
|
|
|
|
|
|
|
|
|
|
|
|
Note: Numbers may not
add due to rounding
|
|
|
|
|
|
|
2017 Guidance
For the full year 2017, the Company now expects:
- Total revenues in the range of $22.3 billion to $23.1 billion, unchanged from
previous guidance.
- On a GAAP basis, EPS in the range of $10.64 to $11.32 and a tax rate in the
range of 16 percent to 18 percent.
-
- Previously, the Company expected GAAP EPS in the range of
$10.45 to $11.31. Tax rate guidance
is unchanged.
- On a non-GAAP basis, EPS in the range of $12.00 to $12.60 and a tax rate in the
range of 18.5 percent to 19.5 percent.
-
- Previously, the Company expected non-GAAP EPS in the range of
$11.80 to $12.60. Tax rate guidance
is unchanged.
- Capital expenditures to be approximately $700 million.
First Quarter
Product and Pipeline Update Key development
milestones:
|
|
Clinical
Program
|
Indication
|
Projected
Milestone
|
Repatha
|
Hyperlipidemia
|
Regulatory
submissions (CV outcomes data)
|
KYPROLIS
|
Relapsed or
refractory multiple myeloma
|
Phase 3 study
initiation with DARZALEX® Q2 '17
|
XGEVA
|
Prevention of SREs in
multiple myeloma
|
Regulatory
reviews
|
EVENITY™
(romosozumab)†
|
Postmenopausal
osteoporosis
|
July 19, 2017, PDUFA
target action date in U.S.
Active controlled
Phase 3 fracture data Q2 2017*
|
Erenumab (AMG
334)
|
Migraine
prevention
|
Regulatory
submissions
|
ABP 215
(biosimilar
bevacizumab)
|
Oncology
|
Regulatory
reviews
Sept. 14, 2017, BsUFA
target action date in U.S.
|
ABP 980
(biosimilar
trastuzumab)
|
Breast
cancer
|
U.S. regulatory
submission
|
|
†Trade
name provisionally approved by FDA; CV = cardiovascular; SRE
= skeletal-related event; PDUFA = Prescription Drug User Fee Act;
BsUFA = Biosimilar User Fee Act; *Event driven study
|
The Company provided the following updates on selected product
and pipeline programs:
Repatha
- In February, the European Commission (EC) approved a new 420 mg
single-dose delivery option for Repatha.
- In March, positive Phase 3 data from a cardiovascular outcomes
study and a cognitive function study were presented at the American
College of Cardiology 66th Annual Scientific
Session.
KYPROLIS
- In February, the Phase 3 ENDEAVOR study showed KYPROLIS
and dexamethasone reduced the risk of death by 21 percent and
extended overall survival by an additional 7.6 months compared to
Velcade® (bortezomib) and dexamethasone in relapsed or
refractory multiple myeloma patients.
XGEVA
- In April, a supplemental Biologics License Application (sBLA)
was submitted to the U.S. Food and Drug Administration (FDA) and an
application for a variation to the marketing authorization was
submitted to the European Medicines Agency (EMA) for the prevention
of SREs in patients with multiple myeloma.
BLINCYTO
- In March, FDA accepted the sBLA for priority review for
BLINCYTO to include overall survival data from the Phase 3 TOWER
study. The application also included new data supporting the
treatment of patients with Philadelphia chromosome-positive relapsed or
refractory B-cell precursor acute lymphoblastic leukemia.
EVENITY
- Primary analysis of an event driven active controlled Phase 3
fracture study (ARCH) in postmenopausal women with osteoporosis is
expected in Q2 2017.
Erenumab
- Regulatory submissions for migraine prevention are expected in
Q2 2017.
CNP520
- In February, Phase 3 enrollment commenced for CNP520, a small
molecule beta-site amyloid precursor protein-cleaving enzyme-1
(BACE) inhibitor for the potential treatment of Alzheimer's
disease.
Parsabiv™ (etelcalcetide)
- In February, FDA approved Parsabiv for the treatment of
secondary hyperparathyroidism (sHPT) in adult patients with chronic
kidney disease (CKD) on hemodialysis.
AMG 157/MEDI9929 (tezepelumab)
- In February, tezepelumab demonstrated a significant reduction
in the rate of asthma exacerbations compared to placebo over the
52-week treatment period in patients with severe asthma in a Phase
2b study.
AMGEVITA™ (biosimilar adalimumab)
- In March, EC granted marketing authorization for AMGEVITA™
(biosimilar adalimumab) in all available indications. AMGEVITA is
authorized for the treatment of certain inflammatory diseases in
adults, including moderate-to-severe rheumatoid arthritis;
psoriatic arthritis; severe active ankylosing spondylitis (AS);
severe axial spondyloarthritis without radiographic evidence of AS;
moderate-to-severe chronic plaque psoriasis; moderate-to-severe
hidradenitis suppurativa; non-infectious intermediate, posterior
and panuveitis; moderate-to-severe Crohn's disease and
moderate-to-severe ulcerative colitis. The EC also approved
AMGEVITA for the treatment of certain pediatric inflammatory
diseases, including moderate-to-severe Crohn's disease (ages six
and older), severe chronic plaque psoriasis (ages four and older),
enthesitis-related arthritis (ages six and older) and polyarticular
juvenile idiopathic arthritis (ages two and older).
ABP 980 (biosimilar trastuzumab)
- In March, a Marketing Authorization Application was submitted
to the EMA.
Erenumab and CNP520 are developed in collaboration with
Novartis AG
EVENITY™ trade name is provisionally approved
by FDA
EVENITY™ is developed in collaboration with UCB
globally, as well as our joint venture partner Astellas in
Japan
Tezepelumab is
developed in collaboration with AstraZeneca
AMGEVITA™ is
registered in the U.S. as AMJEVITA™
Velcade®
is a registered trademark of Millennium Pharmaceuticals,
Inc.
Non-GAAP Financial Measures
In this news release, management has presented its operating
results for the first quarters of 2017 and 2016, in accordance with
U.S. Generally Accepted Accounting Principles (GAAP) and on a
non-GAAP basis. In addition, management has presented its full year
2017 EPS and tax rate guidance in accordance with GAAP and on a
non-GAAP basis. These non-GAAP financial measures are computed by
excluding certain items related to acquisitions, restructuring and
certain other items from the related GAAP financial measures.
Reconciliations for these non-GAAP financial measures to the most
directly comparable GAAP financial measures are included in the
news release. Management has also presented Free Cash Flow (FCF),
which is a non-GAAP financial measure, for the first quarters of
2017 and 2016. FCF is computed by subtracting capital expenditures
from operating cash flow, each as determined in accordance with
GAAP.
The Company believes that its presentation of non-GAAP financial
measures provides useful supplementary information to and
facilitates additional analysis by investors. The Company uses
certain non-GAAP financial measures to enhance an investor's
overall understanding of the financial performance and prospects
for the future of the Company's ongoing business activities by
facilitating comparisons of results of ongoing business operations
among current, past and future periods. The Company believes
that FCF provides a further measure of the Company's liquidity.
The Company uses the non-GAAP financial measures set forth in
the news release in connection with its own budgeting and financial
planning internally to evaluate the performance of the business,
including to allocate resources and to evaluate results relative to
incentive compensation targets. The non-GAAP financial measures are
in addition to, not a substitute for, or superior to, measures of
financial performance prepared in accordance with GAAP.
About Amgen
Amgen is committed to unlocking the potential of biology for
patients suffering from serious illnesses by discovering,
developing, manufacturing and delivering innovative human
therapeutics. This approach begins by using tools like advanced
human genetics to unravel the complexities of disease and
understand the fundamentals of human biology.
Amgen focuses on areas of high unmet medical need and leverages
its expertise to strive for solutions that improve health outcomes
and dramatically improve people's lives. A biotechnology pioneer
since 1980, Amgen has grown to be one of the world's leading
independent biotechnology companies, has reached millions of
patients around the world and is developing a pipeline of medicines
with breakaway potential.
For more information, visit www.amgen.com and follow us on
www.twitter.com/amgen.
Forward-Looking Statements
This news release contains forward-looking statements that are
based on the current expectations and beliefs of Amgen. All
statements, other than statements of historical fact, are
statements that could be deemed forward-looking statements,
including estimates of revenues, operating margins, capital
expenditures, cash, other financial metrics, expected legal,
arbitration, political, regulatory or clinical results or
practices, customer and prescriber patterns or practices,
reimbursement activities and outcomes and other such estimates and
results. Forward-looking statements involve significant risks and
uncertainties, including those discussed below and more fully
described in the Securities and Exchange Commission reports filed
by Amgen, including our most recent annual report on Form 10-K and
any subsequent periodic reports on Form 10-Q and Form 8-K. Unless
otherwise noted, Amgen is providing this information as of the date
of this news release and does not undertake any obligation to
update any forward-looking statements contained in this document as
a result of new information, future events or otherwise.
No forward-looking statement can be guaranteed and actual
results may differ materially from those we project. Our results
may be affected by our ability to successfully market both new and
existing products domestically and internationally, clinical and
regulatory developments involving current and future products,
sales growth of recently launched products, competition from other
products including biosimilars, difficulties or delays in
manufacturing our products and global economic conditions. In
addition, sales of our products are affected by pricing pressure,
political and public scrutiny and reimbursement policies imposed by
third-party payers, including governments, private insurance plans
and managed care providers and may be affected by regulatory,
clinical and guideline developments and domestic and international
trends toward managed care and healthcare cost containment.
Furthermore, our research, testing, pricing, marketing and other
operations are subject to extensive regulation by domestic and
foreign government regulatory authorities. We or others could
identify safety, side effects or manufacturing problems with our
products after they are on the market. Our business may be impacted
by government investigations, litigation and product liability
claims. In addition, our business may be impacted by the adoption
of new tax legislation or exposure to additional tax liabilities.
If we fail to meet the compliance obligations in the corporate
integrity agreement between us and the U.S. government, we could
become subject to significant sanctions. Further, while we
routinely obtain patents for our products and technology, the
protection offered by our patents and patent applications may be
challenged, invalidated or circumvented by our competitors, or we
may fail to prevail in present and future intellectual property
litigation. We perform a substantial amount of our commercial
manufacturing activities at a few key facilities and also depend on
third parties for a portion of our manufacturing activities, and
limits on supply may constrain sales of certain of our current
products and product candidate development. In addition, we compete
with other companies with respect to many of our marketed products
as well as for the discovery and development of new products.
Discovery or identification of new product candidates cannot be
guaranteed and movement from concept to product is uncertain;
consequently, there can be no guarantee that any particular product
candidate will be successful and become a commercial product.
Further, some raw materials, medical devices and component parts
for our products are supplied by sole third-party suppliers.
Certain of our distributors, customers and payers have substantial
purchasing leverage in their dealings with us. The discovery of
significant problems with a product similar to one of our products
that implicate an entire class of products could have a material
adverse effect on sales of the affected products and on our
business and results of operations. Our efforts to acquire other
companies or products and to integrate the operations of companies
we have acquired may not be successful. We may not be able to
access the capital and credit markets on terms that are favorable
to us, or at all. We are increasingly dependent on information
technology systems, infrastructure and data security. Our stock
price is volatile and may be affected by a number of events. Our
business performance could affect or limit the ability of our Board
of Directors to declare a dividend or our ability to pay a dividend
or repurchase our common stock.
Amgen
Inc.
|
Consolidated
Statements of Income - GAAP
|
(In millions,
except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
|
|
March
31,
|
|
|
|
|
2017
|
|
2016
|
Revenues:
|
|
|
|
|
|
Product
sales
|
|
$
5,199
|
|
$
5,239
|
|
Other
revenues
|
|
265
|
|
288
|
|
|
Total
revenues
|
|
5,464
|
|
5,527
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
Cost of
sales
|
|
996
|
|
1,018
|
|
Research and
development
|
|
769
|
|
872
|
|
Selling, general and
administrative
|
|
1,064
|
|
1,203
|
|
Other
|
|
44
|
|
32
|
|
|
Total operating
expenses
|
|
2,873
|
|
3,125
|
|
|
|
|
|
|
|
Operating
income
|
|
2,591
|
|
2,402
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
326
|
|
294
|
Interest and other
income, net
|
|
195
|
|
150
|
|
|
|
|
|
|
|
Income before income
taxes
|
|
2,460
|
|
2,258
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
389
|
|
358
|
|
|
|
|
|
|
|
Net income
|
|
$
2,071
|
|
$
1,900
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
Basic
|
|
$
2.81
|
|
$
2.52
|
|
Diluted
|
|
$
2.79
|
|
$
2.50
|
|
|
|
|
|
|
|
Weighted average
shares used in calculation of earnings per share:
|
|
|
|
|
|
Basic
|
|
737
|
|
753
|
|
Diluted
|
|
741
|
|
760
|
Amgen
Inc.
|
Consolidated
Balance Sheets - GAAP
|
(In
millions)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
|
|
|
|
|
2017
|
|
2016
|
Assets
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash, cash
equivalents and marketable securities
|
|
$
38,398
|
|
$
38,085
|
|
Trade receivables,
net
|
|
3,248
|
|
3,165
|
|
Inventories
|
|
2,871
|
|
2,745
|
|
Other current
assets
|
|
1,939
|
|
2,015
|
|
|
|
Total current
assets
|
|
46,456
|
|
46,010
|
Property, plant and
equipment, net
|
|
4,960
|
|
4,961
|
Intangible assets,
net
|
|
9,922
|
|
10,279
|
Goodwill
|
|
14,757
|
|
14,751
|
Other
assets
|
|
1,767
|
|
1,625
|
Total
assets
|
|
$
77,862
|
|
$
77,626
|
|
|
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts payable and
accrued liabilities
|
|
$
6,724
|
|
$
6,801
|
|
Current portion of
long-term debt
|
|
3,799
|
|
4,403
|
|
|
|
Total current
liabilities
|
|
10,523
|
|
11,204
|
Long-term
debt
|
|
30,293
|
|
30,193
|
Long-term deferred
tax liabilities
|
2,370
|
|
2,436
|
Long-term tax
liabilities
|
|
|
|
|
2,542
|
|
2,419
|
Other noncurrent
liabilities
|
|
1,497
|
|
1,499
|
Stockholders'
equity
|
|
30,637
|
|
29,875
|
Total liabilities and
stockholders' equity
|
|
$
77,862
|
|
$
77,626
|
|
|
|
|
|
|
|
|
|
|
Shares
outstanding
|
|
736
|
|
738
|
Amgen
Inc.
|
GAAP to Non-GAAP
Reconciliations
|
(In
millions)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
March
31,
|
|
|
2017
|
|
2016
|
|
|
|
|
|
|
GAAP cost of
sales
|
$
996
|
|
$
1,018
|
|
Adjustments to
cost of sales:
|
|
|
|
|
Acquisition-related
expenses (a)
|
(314)
|
|
(311)
|
|
Total adjustments
to cost of sales
|
(314)
|
|
(311)
|
|
Non-GAAP cost of
sales
|
$
682
|
|
$
707
|
|
|
|
|
|
|
GAAP cost of sales
as a percentage of product sales
|
19.2%
|
|
19.4%
|
|
Acquisition-related
expenses(a)
|
-6.1
|
|
-5.9
|
|
Non-GAAP cost of
sales as a percentage of product sales
|
13.1%
|
|
13.5%
|
|
|
|
|
|
|
GAAP research and
development expenses
|
$
769
|
|
$
872
|
|
Adjustments to
research and development expenses:
|
|
|
|
|
Acquisition-related
expenses (a)
|
(19)
|
|
(19)
|
|
Certain net charges
pursuant to our restructuring initiative
|
(2)
|
|
5
|
|
Total adjustments
to research and development expenses
|
(21)
|
|
(14)
|
|
Non-GAAP research
and development expenses
|
$
748
|
|
$
858
|
|
|
|
|
|
|
GAAP research and
development expenses as a percentage of product
sales
|
14.8%
|
|
16.6%
|
|
Acquisition-related
expenses (a)
|
-0.4
|
|
-0.3
|
|
Certain net charges
pursuant to our restructuring initiative
|
0.0
|
|
0.1
|
|
Non-GAAP research
and development expenses as a percentage of product
sales
|
14.4%
|
|
16.4%
|
|
|
|
|
|
|
GAAP selling,
general and administrative expenses
|
$1,064
|
|
$
1,203
|
|
Adjustments to
selling, general and administrative expenses:
|
|
|
|
|
Acquisition-related
expenses (b)
|
(25)
|
|
(101)
|
|
Certain net charges
pursuant to our restructuring initiative
|
-
|
|
1
|
|
Total adjustments
to selling, general and administrative expenses
|
(25)
|
|
(100)
|
|
Non-GAAP selling,
general and administrative expenses
|
$1,039
|
|
$
1,103
|
|
|
|
|
|
|
GAAP selling,
general and administrative expenses as a percentage of product
sales
|
20.5%
|
|
23.0%
|
|
Acquisition-related
expenses (b)
|
-0.5
|
|
-1.9
|
|
Certain net charges
pursuant to our restructuring initiative
|
0.0
|
|
0.0
|
|
Non-GAAP selling,
general and administrative expenses as a percentage of product
sales
|
20.0%
|
|
21.1%
|
|
|
|
|
|
|
GAAP operating
expenses
|
$2,873
|
|
$
3,125
|
|
Adjustments to
operating expenses:
|
|
|
|
|
Adjustments to cost
of sales
|
(314)
|
|
(311)
|
|
Adjustments to
research and development expenses
|
(21)
|
|
(14)
|
|
Adjustments to
selling, general and administrative expenses
|
(25)
|
|
(100)
|
|
Certain net charges
pursuant to our restructuring initiative (c)
|
(37)
|
|
(2)
|
|
Expense related to
various legal proceedings
|
-
|
|
(27)
|
|
Acquisition-related
adjustments
|
(7)
|
|
(3)
|
|
Total adjustments
to operating expenses
|
(404)
|
|
(457)
|
|
Non-GAAP operating
expenses
|
$2,469
|
|
$
2,668
|
|
|
|
|
|
|
GAAP operating
income
|
$2,591
|
|
$
2,402
|
|
Adjustments to
operating expenses
|
404
|
|
457
|
|
Non-GAAP operating
income
|
$2,995
|
|
$
2,859
|
|
|
|
|
|
|
GAAP operating
income as a percentage of product sales
|
49.8%
|
|
45.8%
|
|
Adjustments to cost
of sales
|
6.1
|
|
5.9
|
|
Adjustments to
research and development expenses
|
0.4
|
|
0.2
|
|
Adjustments to
selling, general and administrative expenses
|
0.5
|
|
1.9
|
|
Certain net charges
pursuant to our restructuring initiative (c)
|
0.7
|
|
0.1
|
|
Expense related to
various legal proceedings
|
0.0
|
|
0.6
|
|
Acquisition-related
adjustments
|
0.1
|
|
0.1
|
|
Non-GAAP operating
income as a percentage of product sales
|
57.6%
|
|
54.6%
|
|
|
|
|
|
|
GAAP income before
income taxes
|
$2,460
|
|
$
2,258
|
|
Adjustments to
operating expenses
|
404
|
|
457
|
|
Non-GAAP income
before income taxes
|
$2,864
|
|
$
2,715
|
|
|
|
|
|
|
GAAP provision for
income taxes
|
$
389
|
|
$
358
|
|
Adjustments to
provision for income taxes:
|
|
|
|
|
Income tax effect of
the above adjustments to operating expenses (d)
|
119
|
|
139
|
|
Other income tax
adjustments (e)
|
23
|
|
15
|
|
Total adjustments
to provision for income taxes
|
142
|
|
154
|
|
Non-GAAP provision
for income taxes
|
$
531
|
|
$
512
|
|
|
|
|
|
|
GAAP tax rate as a
percentage of income before taxes
|
15.8%
|
|
15.9%
|
|
Adjustments to
provision for income taxes:
|
|
|
|
|
Income tax effect of
the above adjustments to operating expenses
(d)
|
1.9
|
|
2.5
|
|
Other income tax
adjustments (e)
|
0.8
|
|
0.5
|
|
Total adjustments
to provision for income taxes
|
2.7
|
|
3.0
|
|
Non-GAAP tax rate
as a percentage of income before taxes
|
18.5%
|
|
18.9%
|
|
|
|
|
|
|
GAAP net
income
|
$2,071
|
|
$
1,900
|
|
Adjustments to net
income:
|
|
|
|
|
Adjustments to income
before income taxes, net of the income tax effect
|
285
|
|
318
|
|
Other income tax
adjustments (e)
|
(23)
|
|
(15)
|
|
Total adjustments
to net income
|
262
|
|
303
|
|
Non-GAAP net
income
|
$2,333
|
|
$
2,203
|
Amgen
Inc.
|
GAAP to Non-GAAP
Reconciliations
|
(In millions,
except per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table
presents the computations for GAAP and non-GAAP diluted
EPS.
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Three months
ended
|
|
|
|
March 31,
2017
|
|
March 31,
2016
|
|
|
|
GAAP
|
|
Non-GAAP
|
|
GAAP
|
|
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$2,071
|
|
$
2,333
|
|
$1,900
|
|
$
2,203
|
|
|
Weighted-average
shares for diluted EPS
|
741
|
|
741
|
|
760
|
|
760
|
|
|
Diluted
EPS
|
$
2.79
|
|
$
3.15
|
|
$
2.50
|
|
$
2.90
|
|
|
|
(a)
|
The adjustments
related primarily to non-cash amortization of intangible assets
acquired in business combinations.
|
|
|
|
|
|
|
|
|
|
(b)
|
For the three months
ended March 31, 2017, the adjustments related primarily to non-cash
amortization of intangible assets acquired in business
combinations. For the three months ended March 31, 2016, the
adjustments related primarily to a $73-million charge resulting
from the reacquisition of Prolia®, XGEVA® and
Vectibix® license agreements in certain markets from
Glaxo Group Limited, as well as non-cash amortization of intangible
assets acquired in business combinations.
|
|
|
|
|
|
|
|
|
|
(c)
|
For the three months
ended March 31, 2017, the adjustments related primarily to
severance expenses associated with our restructuring
initiative.
|
|
|
|
|
|
|
|
|
|
(d)
|
The tax effect of the
adjustments between our GAAP and non-GAAP results takes into
account the tax treatment and related tax rate(s) that apply to
each adjustment in the applicable tax jurisdiction(s). Generally,
this results in a tax impact at the U.S. marginal tax rate for
certain adjustments, including the majority of amortization of
intangible assets, whereas the tax impact of other adjustments,
including restructuring expense, depends on whether the amounts are
deductible in the respective tax jurisdictions and the applicable
tax rate(s) in those jurisdictions. Due to these factors, the
effective tax rates for the adjustments to our GAAP income before
income taxes, for the three months ended March 31, 2017 and 2016,
were 29.5% and 30.4%, respectively.
|
|
|
|
|
|
|
|
|
|
(e)
|
The adjustments
related to certain acquisition items and prior period items
excluded from non-GAAP earnings.
|
|
|
Amgen
Inc.
|
Reconciliations of
Cash Flows
|
(In
millions)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
|
|
March
31,
|
|
|
|
|
2017
|
|
2016
|
|
Net cash provided by
operating activities
|
$ 2,385
|
|
$ 1,915
|
|
Net cash used in
investing activities
|
(157)
|
|
(4,390)
|
|
Net cash (used in)
provided by financing activities
|
(2,111)
|
|
1,227
|
|
Increase (decrease)
in cash and cash equivalents
|
117
|
|
(1,248)
|
|
Cash and cash
equivalents at beginning of period
|
3,241
|
|
4,144
|
|
Cash and cash
equivalents at end of period
|
$ 3,358
|
|
$ 2,896
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
|
|
|
March
31,
|
|
|
|
|
2017
|
|
2016
|
|
Net cash provided by
operating activities
|
$ 2,385
|
|
$ 1,915
|
|
Capital
expenditures
|
(168)
|
|
(156)
|
|
Free cash
flow
|
$ 2,217
|
|
$ 1,759
|
Reconciliation of
GAAP EPS Guidance to Non-GAAP
|
EPS Guidance for
the Year Ending December 31, 2017
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted EPS
guidance
|
|
$ 10.64
|
-
|
$ 11.32
|
|
|
|
|
|
|
Known adjustments
to arrive at non-GAAP*:
|
|
|
|
|
|
Acquisition-related
expenses
|
(a)
|
|
1.24
|
|
|
Restructuring
charges
|
|
0.07
|
-
|
0.15
|
|
Tax
adjustments
|
(b)
|
|
(0.03)
|
|
|
|
|
|
|
|
Non-GAAP diluted
EPS guidance
|
|
|
$ 12.00
|
-
|
$ 12.60
|
|
|
*
|
The known adjustments
are presented net of their related tax impact which amount to
approximately $0.58 to $0.61 per
share, in the aggregate.
|
|
|
(a)
|
The adjustments
relate primarily to non-cash amortization of intangible assets
acquired in prior year business combinations.
|
|
|
(b)
|
The adjustments
relate to certain prior period items excluded from non-GAAP
earnings.
|
|
|
Reconciliation of
GAAP Tax Rate Guidance to Non-GAAP
|
Tax Rate Guidance
for the Year Ending December 31, 2017
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
2017
|
|
|
|
|
|
|
|
GAAP tax rate
guidance
|
|
16.0%
|
-
|
18.0%
|
|
|
|
|
|
|
|
|
Tax rate effect of
known adjustments discussed above
|
|
1.5%
|
-
|
2.5%
|
|
|
|
|
|
|
|
Non-GAAP tax rate
guidance
|
|
18.5%
|
-
|
19.5%
|
CONTACT: Amgen, Thousand
Oaks
Trish Hawkins, 805-447-5631
(media)
Arvind Sood, 805-447-1060
(investors)
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/amgen-reports-first-quarter-2017-financial-results-300446608.html
SOURCE Amgen