- For Fourth Quarter 2015, Zoetis
Delivers 6% Operational Growth in Revenue and 29% Operational
Growth in Adjusted Net Income, Excluding Foreign Exchange
- Reported Fourth Quarter 2015 Revenue
of $1.3 Billion and Reported Net Income of $22 Million, or $0.04
per Diluted Share
- Fourth Quarter 2015 Adjusted Net
Income of $214 Million, or Adjusted Diluted EPS of $0.43
- For Full Year 2015, Zoetis Delivers
8% Operational Growth in Revenue and 24% Operational Growth in
Adjusted Net Income, Excluding Foreign Exchange
- Reported Full Year 2015 Revenue of
$4.8 Billion and Reported Net Income of $339 Million, or $0.68 per
Diluted Share
- Full Year 2015 Adjusted Net Income
of $889 Million, or Adjusted Diluted EPS of $1.77
- Updates Full Year 2016 Revenue
Guidance to $4.650 - $4.775 Billion and Reaffirms Adjusted Diluted
EPS of $1.71 - $1.81
- Updates Full Year 2017 Revenue
Guidance to $4.950 - $5.150 Billion and Reaffirms Adjusted Diluted
EPS of $2.18 - $2.32
Zoetis Inc. (NYSE:ZTS) today reported its financial results for
the fourth quarter and full year 2015 and updated its guidance for
full year 2016 and 2017.
The company reported revenue of $1.3 billion for the fourth
quarter of 2015, a decrease of 3% from the fourth quarter of 2014.
Revenue reflected an operational1 increase of 6%, excluding the
impact of foreign currency.
Net income for the fourth quarter of 2015 was $22 million, or
$0.04 per diluted share, a decrease of 83% and 84%, respectively,
compared to the fourth quarter of 2014; the significant decrease
was primarily driven by charges related to changes in the company’s
accounting for operations in Venezuela. Adjusted net income2 for
the fourth quarter of 2015 was $214 million, or $0.43 per diluted
share, an increase of 5% and 8%, respectively. Adjusted net income
for the fourth quarter of 2015 excludes the net impact of $192
million, or $0.39 per diluted share, for purchase accounting
adjustments, acquisition-related costs and certain significant
items. On an operational basis, adjusted net income for the fourth
quarter of 2015 increased 29%, with foreign currency having a
negative impact of 24 percentage points.
For the full year 2015, the company reported revenue of $4.8
billion, which is flat compared with the full year 2014. Revenue
reflected an operational increase of 8%, with foreign currency
having a negative impact of 8 percentage points.
Net income for the full year 2015 was $339 million, or $0.68 per
diluted share, decreasing 42% and 41%, respectively, compared to
the full year 2014. Adjusted net income for the full year 2015 was
$889 million, or $1.77 per diluted share, an increase of 13%
compared with full year 2014. Adjusted net income for the full year
2015 excludes the net impact of $550 million, or $1.09 per diluted
share, for purchase accounting adjustments, acquisition-related
costs and certain significant items. On an operational basis,
adjusted net income for the full year 2015 increased 24%, with
foreign currency having a negative impact of 11 percentage
points.
EXECUTIVE COMMENTARY
“In 2015, Zoetis continued to affirm our reputation as the
global leader in the animal health industry with a strong financial
performance, ongoing investments in our future growth, and a
commitment to creating value for our customers and our
shareholders,” said Juan Ramón Alaix, Chief Executive Officer at
Zoetis. “In our three years as a public company, we have been
delivering consistent operational revenue growth, and we expect our
2015 growth to show once again that we are growing faster than the
industry.”
“We also grew our adjusted net income faster than sales as we
focus on greater efficiency in our business,” continued Alaix. “We
continue to have confidence in our end markets, business model, new
product launches, improved product supply and progress toward our
efficiency goals. Despite the negative impacts of foreign currency
and Venezuela, we are pleased to reaffirm our 2016 and 2017
guidance for adjusted earnings per share, which was updated in
January to reflect the European Commission tax decision.”
“We delivered 6% operational revenue growth in the fourth
quarter, which is particularly notable as compared against a strong
fourth quarter of 2014,” said Paul Herendeen, Chief Financial
Officer at Zoetis. “Our commitment to improving the efficiency of
our operations – expenses were down 8% operationally in the quarter
– enabled us to grow adjusted net income by 29% operationally.”
“Our industry and our company continue to grow despite
turbulence in parts of the global economy. For 2015, we delivered
operational revenue growth of 8%, extending our history of growing
faster than the animal health market,” said Herendeen. “The same
drivers that made 2015 a financial success for Zoetis -- a
resilient and growing animal health industry, new products,
lifecycle innovations, business development activities and
fast-paced improvements to our cost structure -- give us great
confidence in our future.”
QUARTERLY HIGHLIGHTS
Zoetis organizes and manages its business across two regional
operating segments: the United States (U.S.) and International.
Within these segments, the company delivers a diverse portfolio of
products for livestock and companion animals tailored to local
trends and customer needs. In the fourth quarter of 2015:
- Revenue in the U.S. segment was
$636 million, an increase of 8% compared with the fourth quarter of
2014. Sales of companion animal products grew 30%, due to the
addition of products acquired from Abbott Animal Health and
increased availability of APOQUEL®. Sales of livestock products
declined 5%, primarily in swine and cattle products, due to the
timing of seasonal buying patterns compared with the prior
year.
- Revenue in the International
segment was $624 million, an increase of 3% operationally
compared with the fourth quarter of 2014. Sales of companion animal
products grew 6% operationally, led by increased availability of
APOQUEL in the UK and other European markets, timing of buying
patterns in Japan, and continued growth of vaccines in China. Sales
of livestock products grew 2% operationally, led by growth in
Brazil, Spain and Mexico. Growth in Brazil was due to strength in
the cattle market and successful new product launches. Growth in
Spain was driven by strong performance in swine, while growth in
Mexico was due to performance of key brands in cattle and swine.
Livestock growth in these markets was offset by business reductions
in Venezuela and India, weakness in anti-infective sales in Western
Europe, and unfavorable weather conditions in the UK.
Zoetis continues to drive demand and strengthen its diverse
portfolio of products through lifecycle innovations, strong
customer relationships and access to new markets and technologies.
The company is focused on improving the performance and delivery of
its current product lines; expanding product indications across
species; pursuing approvals in new geographies; and developing
innovative medicines, treatments and solutions for emerging
diseases and unmet customer needs. Some recent highlights
include:
- Zoetis received approval in the
European Union and New Zealand for SIMPARICA™ (sarolaner), a
new oral parasiticide for dogs that will help the company compete
in the approximately $3 billion global market of flea and tick
products. Zoetis is also on track for approval in the U.S. in the
first quarter of 2016 and expects to launch there and in the EU at
that time, with other global markets to follow.
- Zoetis continued to broaden its
innovative vaccine offerings for both companion animal and
livestock as it strengthens its portfolio and focus on disease
prevention.
- In November, the company was granted a
conditional license from the U.S. Department of Agriculture (USDA)
to market Canine Influenza Vaccine, H3N2, Killed Virus, the
first conditionally licensed vaccine to help control disease
associated with canine influenza virus H3N2 (CIV H3N2).
- Zoetis also expanded its
INNOVATOR® horse vaccine franchise in the U.S. in November
with the launch of LEPTO EQ INNOVATOR®, the first and only vaccine
licensed for use in horses, six months of age or older, to aid in
the prevention of leptospirosis caused by L. Pomona.
- In December, the company received USDA
licensure for VANGUARD®crLyme, a vaccine that aids in the
prevention of clinical disease and subclinical arthritis associated
with Borrelia burgdorferi, the causative agent of Lyme disease in
dogs.
- Shortly after the company closed its
deal in the fourth quarter to acquire PHARMAQ, the global
leader in vaccines for aquaculture, one of their new vaccines for
salmon received an emergency license in Chile, one of the world’s
largest farmed fish markets.
- As part of bringing lifecycle
innovation to its existing portfolio, Zoetis received approvals for
new indications and formulations of key products.
- In January, Zoetis received FDA
approval for an update to the labeling for CERENIA®
(maropitant citrate) Injectable, which allows for intravenous
administration during surgical protocols, which use medication that
induces vomiting. Previously approved only for subcutaneous
injection, this CERENIA label update gives veterinarians the
flexibility of an additional delivery option to help prevent
vomiting in canine and feline patients.
- The company also launched a new
formulation of LUTALYSE®, a reproductive product for use in
dairy and beef cattle, in the U.S. LUTALYSE HighCon is the first
and only prostaglandin on the market approved by the FDA for
subcutaneous administration in addition to intramuscular
administration. This approval provides producers and veterinarians
with flexible administration options while allowing them to abide
by strict dairy and beef quality assurance standards.
FINANCIAL GUIDANCE
Zoetis' guidance for the full year 2016 and the full year 2017
continues to reflect the company’s confidence in its diverse
portfolio, the strength of its business model, and the stability
and predictability of the animal health industry. The guidance
includes the previously announced impact of the European Commission
decision regarding Belgium tax rulings.
Zoetis has also updated elements of its guidance today to
reflect foreign exchange rates as of late January, changes related
to the company’s accounting for its operations in Venezuela, and
other operational views. Considering these factors, the company’s
guidance for the full year 2016 and the full year 2017 is the
following:
Full Year 2016:
- Revenue of between $4.650 billion to
$4.775 billion
- Reported diluted EPS for the full year
of between $1.30 to $1.48 per share
- Adjusted diluted EPS for the full year
between $1.71 to $1.81 per share
Full Year 2017:
- Revenue of between $4.950 billion to
$5.150 billion
- Reported diluted EPS for the full year
of between $1.95 to $2.13 per share
- Adjusted diluted EPS for the full year
between $2.18 to $2.32 per share
“Despite the continued negative impact of foreign currency since
we provided guidance in November, we have been able to offset that
impact on our adjusted diluted EPS, based on the strong momentum in
our business, advancement of our R&D pipeline and successful
execution of our efficiency plans,” said Paul Herendeen, Chief
Financial Officer at Zoetis.
Additional guidance on other items such as expenses and tax rate
is included in the financial tables and will be discussed on the
company's conference call this morning.
WEBCAST & CONFERENCE CALL
DETAILS
Zoetis will host a webcast and conference call at 8:30 a.m.
(EST) today, during which company executives will review fourth
quarter and full year 2015 results, discuss 2016 and 2017 financial
guidance and respond to questions from financial analysts.
Investors and the public may access the live webcast by visiting
the Zoetis website at http://www.zoetis.com/events-and-presentations. A
replay of the webcast will be archived and made available on Feb.
16, 2016.
About Zoetis
Zoetis (zô-EH-tis) is the leading
animal health company, dedicated to supporting its customers and
their businesses. Building on more than 60 years of experience in
animal health, Zoetis discovers, develops, manufactures and markets
veterinary vaccines and medicines, complemented by diagnostic
products and genetic tests and supported by a range of services.
Zoetis serves veterinarians, livestock producers and people who
raise and care for farm and companion animals with sales of its
products in more than 100 countries. In 2015, the company generated
annual revenue of $4.8 billion with approximately 9,000 employees.
For more information, visit www.zoetis.com.
1 Operational revenue growth is defined as revenue growth
excluding the impact of foreign exchange.
2 Adjusted net income and its components and adjusted diluted
earnings per share (non-GAAP financial measures) are defined as
reported net income attributable to Zoetis and reported diluted
earnings per share, excluding purchase accounting adjustments,
acquisition-related costs and certain significant items.
DISCLOSURE NOTICES
Forward-Looking Statements: This
press release contains forward-looking statements, which reflect
the current views of Zoetis with respect to business plans or
prospects, future operating or financial performance, future
guidance, future operating models, expectations regarding products,
future use of cash and dividend payments, tax rate, and other
future events. In particular, this press release contains forward
looking statements that reflect the current views of Zoetis with
respect to our tax rate and tax regimes, changes in the tax regimes
in other jurisdictions and challenges to our efforts to mitigate
the impact of tax decisions such as the recent one by the European
Commission. These statements are not guarantees of future
performance or actions. Forward-looking statements are subject to
risks and uncertainties. If one or more of these risks or
uncertainties materialize, or if management's underlying
assumptions prove to be incorrect, actual results may differ
materially from those contemplated by a forward-looking statement.
Forward-looking statements speak only as of the date on which they
are made. Zoetis expressly disclaims any obligation to update or
revise any forward-looking statement, whether as a result of new
information, future events or otherwise. A further list and
description of risks, uncertainties and other matters can be found
in our Annual Report on Form 10-K for the fiscal year ended
December 31, 2014, including in the sections thereof captioned
“Forward-Looking Information and Factors That May Affect Future
Results” and “Item 1A. Risk Factors,” in our Quarterly Reports on
Form 10-Q and in our Current Reports on Form 8-K. These filings and
subsequent filings are available online at www.sec.gov,
www.zoetis.com, or on request from Zoetis.
Use of Non-GAAP Financial Measures:
We use non-GAAP financial measures, such as adjusted net income and
adjusted diluted earnings per share, to assess and analyze our
operational results and trends and to make financial and
operational decisions. We believe these non-GAAP financial measures
are also useful to investors because they provide greater
transparency regarding our operating performance. The non-GAAP
financial measures included in this press release should not be
considered alternatives to measurements required by GAAP, such as
net income, operating income, and earnings per share, and should
not be considered measures of liquidity. These non-GAAP financial
measures are unlikely to be comparable with non-GAAP information
provided by other companies. Reconciliation of non-GAAP financial
measures and GAAP financial measures are included in the tables
accompanying this press release and are posted on our website at
www.zoetis.com.
Internet Posting of Information: We
routinely post information that may be important to investors in
the 'Investors' section of our website at www.zoetis.com, on our Facebook page at
http://www.facebook.com/zoetis and on Twitter @zoetis. We encourage
investors and potential investors to consult our website regularly
and to follow us on Facebook and Twitter for important information
about us.
ZOETIS INC.
CONSOLIDATED STATEMENTS OF INCOME(a)
(UNAUDITED)
(millions of dollars, except per share
data)
Fourth Quarter Full Year 2015 2014 %
Change 2015 2014 % Change Revenue $ 1,274 $ 1,320 (3)
$ 4,765 $ 4,785 — Costs and expenses: Cost of sales(b) 496 491 1
1,738 1,717 1 Selling, general and administrative expenses(b) 425
497 (14) 1,532 1,643 (7) Research and development expenses(b) 109
124 (12) 364 396 (8) Amortization of intangible assets(c) 16 14 14
61 60 2 Restructuring charges and certain acquisition-related costs
40 15 * 320 25 * Interest expense 38 30 27 124 117 6 Other
(income)/deductions–net 81 (6 ) * 81 7 *
Income before provision for taxes on income 69 155 (55) 545 820
(34) Provision for taxes on income 49 29 69 206
233 (12) Net income before allocation to
noncontrolling interests 20 126 (84) 339 587 (42) Less: Net income
(loss) attributable to noncontrolling interests (2 ) — * —
4 * Net income attributable to Zoetis $ 22 $
126 (83) $ 339 $ 583 (42) Earnings per
share—basic $ 0.04 $ 0.25 (84) $ 0.68 $ 1.16
(41) Earnings per share—diluted $ 0.04 $ 0.25
(84) $ 0.68 $ 1.16 (41)
Weighted-average shares used to calculate
earnings per share (in
thousands)
Basic 498,271 501,560 499,707 501,055
Diluted 500,639 503,269 502,019 502,025
* Calculation not meaningful. (a) The
consolidated statements of income present the three and twelve
months ended December 31, 2015 and 2014. Subsidiaries operating
outside the United States are included for the three and twelve
months ended November 30, 2015 and 2014. (b) Exclusive of
amortization of intangible assets, except as discussed in footnote
(c) below. (c)
Amortization expense related to
finite-lived acquired intangible assets that contribute to our
ability to sell, manufacture, research, market and distribute
products, compounds and intellectual property is included in
Amortization of intangible assets as these intangible assets
benefit multiple business functions. Amortization expense related
to acquired intangible assets that are associated with a single
function is included in Cost of sales, Selling, general and
administrative expenses or Research and development expenses, as
appropriate.
Certain amounts and percentages may reflect rounding
adjustments.
ZOETIS INC.
RECONCILIATION OF GAAP REPORTED TO
NON-GAAP ADJUSTED INFORMATION
CERTAIN LINE ITEMS
(UNAUDITED)
(millions of dollars, except per share
data)
Quarter Ended December 31, 2015
GAAP
Reported(1)
Purchase
Accounting
Adjustments
Acquisition-
Related
Costs(2)
Certain
Significant
Items(3)
Non-GAAP
Adjusted(a)
Revenue
$ 1,274 $ — $ — $ —
$
1,274
Cost of sales(b)
496 (2 ) — (27 ) 467 Gross profit
778 2 — 27 807 Selling, general and administrative
expenses(b)
425 — — (35 ) 390 Research and development
expenses(b)
109 (1 ) — (2 ) 106 Amortization of intangible
assets(c)
16 (13 ) — — 3 Restructuring charges and certain
acquisition-related costs
40 — (10 ) (30 ) — Interest
expense
38 — — — 38 Other (income)/deductions–net
81
— — (92 ) (11 ) Income before provision for taxes on income
69 16 10 186 281 Provision for taxes on income
49 4 1
15 69 Income from continuing operations
20 12 9 171 212 Net
loss attributable to noncontrolling interests
(2 ) —
— — (2 ) Net income attributable to Zoetis
22 12 9 171 214
Earnings per common share attributable to Zoetis–diluted(d)
0.04 0.03 0.02 0.34 0.43 Quarter Ended December 31,
2014
GAAP
Reported(1)
Purchase
Accounting
Adjustments
Acquisition-
Related
Costs(2)
Certain
Significant
Items(3)
Non-GAAP
Adjusted(a)
Revenue
$ 1,320 $ — $ — $ — $ 1,320 Cost of sales(b)
491 (1 ) — (19 ) 471 Gross profit
829 1 — 19 849
Selling, general and administrative expenses(b)
497 (1 ) —
(46 ) 450 Research and development expenses(b)
124 (1 ) — (1
) 122 Amortization of intangible assets(c)
14 (10 ) — — 4
Restructuring charges and certain acquisition-related costs
15 — (3 ) (12 ) — Interest expense
30 — — — 30 Other
(income)/deductions–net
(6 ) — — — (6 ) Income before
provision for taxes on income
155 13 3 78 249 Provision for
taxes on income
29 4 1 12 46 Net income attributable to
Zoetis
126 9 2 66 203 Earnings per common share attributable
to Zoetis–diluted(d)
0.25 0.02 — 0.13 0.40
ZOETIS INC.
RECONCILIATION OF GAAP REPORTED TO
NON-GAAP ADJUSTED INFORMATION
CERTAIN LINE ITEMS
(UNAUDITED)
(millions of dollars, except per share
data)
Twelve Months Ended December 31,
2015
GAAP
Reported(1)
Purchase
Accounting
Adjustments
Acquisition-
Related
Costs(2)
Certain
Significant
Items(3)
Non-GAAP
Adjusted(a)
Revenue
$ 4,765 $ — $ — $ — $ 4,765 Cost of sales(b)
1,738 (9 ) — (62 ) 1,667 Gross profit
3,027 9 — 62
3,098 Selling, general and administrative expenses(b)
1,532
— — (133 ) 1,399 Research and development expenses(b)
364 (2
) — (2 ) 360 Amortization of intangible assets(c)
61 (46 ) —
— 15 Restructuring charges and certain acquisition-related costs
320 — (19 ) (301 ) — Interest expense
124 — — — 124
Other (income)/deductions–net
81 — (2 ) (94 ) (15 ) Income
before provision for taxes on income
545 57 21 592 1,215
Provision for taxes on income
206 18 (1 ) 103 326 Net income
attributable to Zoetis
339 39 22 489 889 Earnings per common
share attributable to Zoetis–diluted(d)
0.68 0.08 0.04 0.97
1.77 Twelve Months Ended December 31, 2014
GAAP
Reported(1)
Purchase
Accounting
Adjustments
Acquisition-
Related
Costs(2)
Certain
Significant
Items(3)
Non-GAAP
Adjusted(a)
Revenue
$ 4,785 $ — $ — $ — $ 4,785 Cost of sales(b)
1,717 (4 ) — (33 ) 1,680 Gross profit
3,068 4 — 33
3,105 Selling, general and administrative expenses(b)
1,643
— — (136 ) 1,507 Research and development expenses(b)
396 (2
) — (1 ) 393 Amortization of intangible assets(c)
60 (45 ) —
— 15 Restructuring charges and certain acquisition-related costs
25 — (8 ) (17 ) — Interest expense
117 — — — 117
Other (income)/deductions–net
7 — — (18 ) (11 ) Income
before provision for taxes on income
820 51 8 205 1,084
Provision for taxes on income
233 17 3 37 290 Income from
continuing operations
587 34 5 168 794 Net loss attributable
to noncontrolling interests
4 — — — 4 Net income
attributable to Zoetis
583 34 5 168 790 Earnings per common
share attributable to Zoetis–diluted(d)
1.16 0.07 0.01 0.33
1.57 (a) Non-GAAP adjusted net income and its
components and non-GAAP adjusted diluted EPS are not, and should
not be viewed as, substitutes for U.S. GAAP net income and its
components and diluted EPS. Despite the importance of these
measures to management in goal setting and performance measurement,
non-GAAP adjusted net income and its components and non-GAAP
adjusted diluted EPS are non-GAAP financial measures that have no
standardized meaning prescribed by U.S. GAAP and, therefore, have
limits in their usefulness to investors. Because of the
non-standardized definitions, non-GAAP adjusted net income and its
components and non-GAAP adjusted diluted EPS (unlike U.S. GAAP net
income and its components and diluted EPS) may not be comparable to
the calculation of similar measures of other companies. Non-GAAP
adjusted net income and its components and non-GAAP adjusted
diluted EPS are presented solely to permit investors to more fully
understand how management assesses performance. (b)
Exclusive of amortization of intangible assets, except as discussed
in footnote (c) below. (c)
Amortization expense related to
finite-lived acquired intangible assets that contribute to our
ability to sell, manufacture, research, market and distribute
products, compounds and intellectual property is included in
Amortization of intangible assets as these intangible assets
benefit multiple business functions. Amortization expense related
to acquired intangible assets that are associated with a single
function is included in Cost of sales, Selling, general and
administrative expenses or Research and development expenses, as
appropriate.
(d) EPS amounts may not add due to rounding.
See Notes to Reconciliation of GAAP
Reported to Non-GAAP Adjusted Information for notes (1), (2) and
(3).
Certain amounts may reflect rounding adjustments.
ZOETIS INC. NOTES TO RECONCILIATION OF GAAP REPORTED TO
NON-GAAP ADJUSTED INFORMATION CERTAIN LINE ITEMS (UNAUDITED)
(millions of dollars) (1) The consolidated statements
of income present the three and twelve months ended December 31,
2015 and 2014. Subsidiaries operating outside the United States are
included for the three and twelve months ended November 30, 2015
and 2014. (2) Acquisition-related costs include the
following: Fourth Quarter
Full Year 2015 2014 2015 2014
Transaction costs(a) $ 9 $ — $ 9 $ — Integration costs(b) 1 3 10 8
Other(c) — — 2 — Total acquisition-related
costs—pre-tax 10 3 21 8 Income taxes(d) 1 1 (1 ) 3
Total acquisition-related costs—net of tax $ 9 $ 2 $
22 $ 5 (a)
Transaction costs represent external costs
directly related to acquiring businesses and primarily include
expenditures for banking, legal, accounting and other similar
services. Included in Restructuring charges and certain
acquisition-related costs.
(b)
Integration costs represent external,
incremental costs directly related to integrating acquired
businesses and primarily include expenditures for consulting and
the integration of systems and processes. Included in Restructuring
charges and certain acquisition-related costs.
(c)
Included in Other (income)
deductions—net.
(d)
Included in Provision for taxes on income.
Income taxes include the tax effect of the associated pre-tax
amounts, calculated by determining the jurisdictional location of
the pre-tax amounts and applying that jurisdiction's applicable tax
rate, as well as a tax charge related to the acquisition of certain
assets of Abbott Animal Health.
(3) Certain significant items include the
following:
Fourth Quarter
Full Year 2015 2014 2015 2014
Operational efficiency initiative(a) $ 52 $ — $ 346 $ — Supply
network strategy(b) 4 — 27 — Other restructuring charges and
cost-reduction/productivity initiatives(c) — 13 — 18 Certain asset
impairment charges(d) 3 — 5 6 Net gain on sale of assets(e) — (2 )
— (5 ) Stand-up costs(f) 34 62 118 168 Foreign currency loss
related to Venezuela revaluation(g) 93 — 93 — Other(h) — 5
3 18 Total certain significant items—pre-tax
186 78 592 205 Income taxes(i) 15 12 103 37
Total certain significant items—net of tax $ 171 $ 66
$ 489 $ 168 (a)
For the three months ended December 31,
2015, includes restructuring charges of $30 million
related to employee termination costs ($25 million) and asset
impairments ($5 million), included in Restructuring charges and
certain acquisition-related costs, inventory write-offs of $8
million, included in Cost of sales, accelerated depreciation of $2
million, included in Research and development expenses, and $12
million primarily related to consulting fees included in Selling,
general and administrative expenses. For the twelve months ended
December 31, 2015, includes restructuring charges of $291 million
related to employee termination costs ($253 million) and asset
impairments ($38 million), included in Restructuring charges and
certain acquisition-related costs, inventory write-offs of $13
million, included in Cost of sales, accelerated depreciation of $2
million, included in Research and development expenses, and $40
million primarily related to consulting fees included in Selling,
general and administrative expenses.
(b)
For the three months ended December 31,
2015, includes accelerated depreciation of $1 million, included in
Cost of sales, and $3 million primarily related to consulting fees,
included in Cost of sales. For the twelve months ended December 31,
2015, includes restructuring charges of $10 million related to
employee termination costs ($9 million) and asset impairments ($1
million), included in Restructuring charges and certain
acquisition-related costs, accelerated depreciation of $1 million,
included in Cost of sales, and $16 million primarily related to
consulting fees, included in Cost of sales.
(c)
Represents charges incurred for
restructuring and cost-reduction/productivity initiatives. For the
three and twelve months ended December 31, 2014, primarily
represents employee severance costs in Europe and our global
manufacturing operations. Included in Restructuring charges and
certain acquisition-related costs.
(d)
Included in Other (income)/deductions—net.
For the three and twelve months ended December 31, 2015, represents
impairment charges related to assets held by our joint venture in
Taiwan. The twelve months ended December 31, 2015, also includes an
impairment of IPR&D assets related to the termination of a
canine oncology project. For the twelve months ended December 31,
2014, represents an impairment charge related to an IPR&D
project acquired with the FDAH acquisition in 2009.
(e)
For the three months ended December 31,
2014, represents the net gain on the government-mandated sale of
certain product rights in Argentina that were acquired with the
FDAH acquisition in 2009, included in Other
(income)/deductions—net. For the twelve months ended December 31,
2014, primarily represents the Zoetis portion of a net gain on the
sale of land by our Taiwan joint venture ($3 million) and the net
gain on the government-mandated sale of certain product rights in
Argentina that were acquired with the FDAH acquisition in 2009 ($2
million), included in Other (income)/deductions—net.
(f)
Represents certain nonrecurring costs
related to becoming an independent public company, such as new
branding (including changes to the manufacturing process for
required new packaging), the creation of standalone systems and
infrastructure, site separation, and certain legal registration and
patent assignment costs. For the three months ended December 31,
2015, included in Cost of sales ($11 million), Selling, general and
administrative expenses ($22 million), and Other
(income)/deductions—net ($1 million). For the twelve months ended
December 31, 2015, included in Cost of sales ($27 million),
Selling, general and administrative expenses ($90 million), and
Other (income)/deductions—net ($1 million). For the three months
ended December 31, 2014, included in Cost of sales ($18 million),
Selling, general and administrative expenses ($41 million), and
Other (income)/deductions—net ($3 million). For the twelve months
ended December 31, 2014, included in Cost of sales ($32 million),
Selling, general and administrative expenses ($131 million), and
Other (income)/deductions—net ($5 million).
(g) Represents charges primarily related to the foreign
currency losses associated with our Venezuela business. (h)
The twelve months ended December 31, 2015, represents charges due
to unusual investor-related activities. The three months ended
December 31, 2014, represents charges due to unusual
investor-related activities. For the twelve months ended December
31, 2014, primarily includes a charge associated with a commercial
settlement in Mexico ($13 million), partially offset by the
insurance recovery ($1 million income), charges due to unusual
investor-related activities ($5 million), a pension plan settlement
charge related to the divestiture of a manufacturing plant ($4
million), and an insurance recovery of other litigation related
charge ($2 million income). (i)
Included in Provision for taxes on income.
Income taxes include the tax effect of the associated pre-tax
amounts, calculated by determining the jurisdictional location of
the pre-tax amounts and applying that jurisdiction's applicable tax
rate. The twelve months ended December 31, 2015, also includes a
net tax benefit related to the revaluation of deferred taxes and
other deferred tax adjustments.
ZOETIS INC.
ADJUSTED SELECTED COSTS AND
EXPENSES(a)
(UNAUDITED)
(millions of dollars)
% Change
Fourth Quarter (Favorable)/Unfavorable 2015 2014
Total
Foreign
Exchange
Operational Adjusted cost of sales $ 467 $ 471 (1 )%
(3 )% 2 % As a percent of revenue 36.7 % 35.7 % NA NA NA Adjusted
SG&A expenses 390 450 (13 )% (6 )% (7 )% Adjusted R&D
expenses 106 122 (13 )% (4 )% (9 )% Adjusted net income
attributable to Zoetis 214 203 5 % (24 )% 29 % %
Change Full Year (Favorable)/Unfavorable 2015 2014 Total
Foreign
Exchange
Operational Adjusted cost of sales $ 1,667 $ 1,680 (1 )% (8 )% 7 %
As a percent of revenue 35.0 % 35.1 % NA NA NA Adjusted SG&A
expenses 1,399 1,507 (7 )% (7 )% — % Adjusted R&D expenses 360
393 (8 )% (3 )% (5 )% Adjusted net income attributable to Zoetis
889 790 13 % (11 )% 24 % (a) Adjusted cost of sales,
adjusted selling, general, and administrative (SG&A) expenses,
adjusted research and development (R&D) expenses, and adjusted
net income attributable to Zoetis are defined as the corresponding
reported U.S. generally accepted accounting principles (GAAP)
income statement line items excluding purchase accounting
adjustments, acquisition-related costs, and certain significant
items. Reconciliations of certain reported to adjusted information
for the three and twelve months ended December 31, 2015 and 2014
are provided in the materials accompanying this report. These
adjusted income statement line item measures are not, and should
not be viewed as, substitutes for the corresponding U.S. GAAP line
items.
ZOETIS INC.
2016 GUIDANCE
Selected Line Items
(millions of dollars, except per share
amounts)
As provided on
November 3, 2015
January EC
Tax Matter(a)
Foreign
Exchange and
Venezuela(b)
Other
Updated
Full Year 2016
Revenue $4,750 to $4,875
($125) $25 $4,650 to $4,775 Operational
growth 3% to 5%
2% to 4% Adjusted cost of
sales as a percentage of revenue(c) 33% to 34%
33% to 34% Adjusted SG&A expenses(c)
$1,310 to $1,360 ($35)
($25) $1,250 to $1,300 Adjusted R&D
expenses(c) $360 to $380
$360 to $380
Adjusted interest expense and other
(income)/deductions(c)
Approximately $150
Approximately $150
Adjusted EBIT margin(c) Approximately 31%
Approximately 31% Effective tax rate on adjusted income(c)
Approximately 28%
Approximately 33%
Adjusted diluted EPS(c) $1.84 to $1.94
($0.13) ($0.06) $0.06
$1.71 to $1.81 Adjusted net income(c) $925 to $975 ($65) ($30) $25
$855 to $905 Operational growth 14% to 20%
6% to 12%
Certain significant items(d) and
acquisition-related
costs
$130 to $180
($60) $70 to $120 Reported
diluted EPS $1.50 to $1.68 ($0.24)
($0.06) $0.10 $1.30 to
$1.48 A reconciliation of 2016 adjusted net income and
adjusted diluted EPS guidance to 2016 reported net income
attributable to Zoetis and reported diluted EPS attributable to
Zoetis common shareholders guidance follows:
Full-Year 2016 Guidance (millions of
dollars, except per share amounts) Net
Income Diluted EPS Adjusted net income/diluted
EPS(c) guidance ~$855 - $905 ~$1.71 - $1.81 Purchase accounting
adjustments ~(60) ~(0.12) Certain significant items(d) and
acquisition-related costs ~(105
- 145) ~(0.21 - 0.29) Reported net income
attributable to Zoetis/diluted EPS guidance
~$650 - $740 ~$1.30 - $1.48
(a) Reflects the impact of the European Commission
decision regarding Belgium tax rulings, as announced in January
2016. The reported diluted EPS impact includes $55 million of
one-time charges, in addition to the $65 million impact to adjusted
net income. (b)
Reflects the impact of changes to foreign
exchange rates underlying prior guidance and late January 2016
foreign exchange rates.
(c) Adjusted net income and its components and adjusted
diluted EPS are defined as reported U.S. generally accepted
accounting principles (GAAP) net income and its components and
reported diluted EPS excluding purchase accounting adjustments,
acquisition-related costs and certain significant items. Adjusted
cost of sales, adjusted selling, general and administrative
(SG&A) expenses, adjusted research and development (R&D)
expenses, adjusted interest expense and adjusted other
(income)/deductions are income statement line items prepared on the
same basis, and, therefore, components of the overall adjusted
income measure. Adjusted earnings before interest and taxes (EBIT)
is defined as reported EBIT excluding purchase accounting
adjustments, acquisition-related costs and certain significant
items. Despite the importance of these measures to management in
goal setting and performance measurement, adjusted net income and
its components and adjusted diluted EPS are non-GAAP financial
measures that have no standardized meaning prescribed by U.S. GAAP
and, therefore, have limits in their usefulness to investors.
Because of the non-standardized definitions, adjusted net income
and its components and adjusted diluted EPS (unlike U.S. GAAP net
income and its components and diluted EPS) may not be comparable to
the calculation of similar measures of other companies. Adjusted
net income and its components and adjusted diluted EPS are
presented solely to permit investors to more fully understand how
management assesses performance. Adjusted net income and its
components and adjusted diluted EPS are not, and should not be
viewed as, substitutes for U.S. GAAP net income and its components
and diluted EPS. (d) Primarily includes certain nonrecurring
costs related to restructuring and other charges for the
operational efficiency initiative and supply network strategy,
becoming an independent public company, such as new branding
(including changes to the manufacturing process for required new
packaging), the creation of standalone systems and infrastructure,
site separation, and certain legal registration and patent
assignment costs.
ZOETIS INC.
2017 GUIDANCE
Selected Line Items
(millions of dollars, except per share
amounts)
As provided on
November 3, 2015
January EC
Tax Matter(a)
Foreign
Exchange and
Venezuela(b)
Other Updated
Full Year 2017
Revenue $5,025 to $5,225
($150) $75 $4,950 to $5,150 Operational
growth 4% to 9%
5% to 9% Adjusted cost of
sales as a percentage of revenue(c) 32% to 33%
32% to 33% Adjusted SG&A expenses(c)
$1,270 to $1,360 ($40)
($10) $1,220 to $1,310 Adjusted R&D
expenses(c) $360 to $380
$360 to $380
Adjusted interest expense and other
(income)/deductions(c)
Approximately $150
Approximately $150
Adjusted EBIT margin(c) Approximately 34%
Approximately 34% Effective tax rate on adjusted income(c)
Approximately 28%
Approximately 30%
Adjusted diluted EPS(c) $2.24 to $2.38
($0.06) ($0.08) $0.08
$2.18 to $2.32 Adjusted net income(c) $1,125 to $1,195 ($30) ($40)
$35 $1,090 to $1,160 Operational growth 18% to 26%
24% to 32%
Certain significant items(d) and
acquisition-related
costs
$50 to $80
$50 to $80 Reported diluted EPS
$2.04 to $2.22 ($0.06)
($0.08) $0.05 $1.95 - $2.13 A
reconciliation of 2017 adjusted net income and adjusted diluted EPS
guidance to 2017 reported net income attributable to Zoetis and
reported diluted EPS attributable to Zoetis common shareholders
guidance follows:
Full-Year 2017 Guidance (millions of dollars, except per share
amounts) Net Income
Diluted EPS Adjusted net income/diluted EPS(c) guidance
~$1,090 - $1,160 ~$2.18 - $2.32 Purchase accounting adjustments
~(60) ~(0.12) Certain significant items(d) and acquisition-related
costs ~(35 - 55)
~(0.07 - 0.11) Reported net income attributable to
Zoetis/diluted EPS guidance
~$975 - $1,065 ~$1.95 - $2.13 (a)
Reflects the impact of the European Commission decision
regarding Belgium tax rulings, as announced in January 2016.
(b)
Reflects the impact of changes to foreign
exchange rates underlying prior guidance and late January 2016
foreign exchange rates.
(c) Adjusted net income and its components and adjusted
diluted EPS are defined as reported U.S. generally accepted
accounting principles (GAAP) net income and its components and
reported diluted EPS excluding purchase accounting adjustments,
acquisition-related costs and certain significant items. Adjusted
cost of sales, adjusted selling, general and administrative
(SG&A) expenses, adjusted research and development (R&D)
expenses, adjusted interest expense, adjusted other
(income)/deductions are income statement line items prepared on the
same basis, and, therefore, components of the overall adjusted
income measure. Adjusted earnings before interest and taxes (EBIT)
is defined as reported EBIT excluding purchase accounting
adjustments, acquisition-related costs and certain significant
items. Despite the importance of these measures to management in
goal setting and performance measurement, adjusted net income and
its components and adjusted diluted EPS are non-GAAP financial
measures that have no standardized meaning prescribed by U.S. GAAP
and, therefore, have limits in their usefulness to investors.
Because of the non-standardized definitions, adjusted net income
and its components and adjusted diluted EPS (unlike U.S. GAAP net
income and its components and diluted EPS) may not be comparable to
the calculation of similar measures of other companies. Adjusted
net income and its components and adjusted diluted EPS are
presented solely to permit investors to more fully understand how
management assesses performance. Adjusted net income and its
components and adjusted diluted EPS are not, and should not be
viewed as, substitutes for U.S. GAAP net income and its components
and diluted EPS. (d) Primarily includes certain nonrecurring
costs related to restructuring and other charges for the
operational efficiency initiative and supply network strategy,
becoming an independent public company, such as new branding
(including changes to the manufacturing process for required new
packaging), the creation of standalone systems and infrastructure,
site separation, and certain legal registration and patent
assignment costs.
ZOETIS INC.
CONSOLIDATED REVENUE BY SEGMENT(a) AND
SPECIES
(UNAUDITED)
(millions of dollars)
Fourth Quarter
% Change 2015 2014 Total
Foreign
Exchange
Operational
Revenue: Livestock $ 803 $ 904 (11
)% (10 )% (1 )% Companion Animal 457 405 13 % (6 )% 19 % Contract
Manufacturing 14 11 27 % (14 )% 41 %
Total
Revenue $ 1,274 $ 1,320
(3 )% (9 )% 6 %
U.S. Livestock $ 348 $ 368 (5 )% — % (5 )% Companion
Animal 288 221 30 % — % 30 %
Total U.S.
Revenue $ 636 $ 589
8 % — % 8 %
International Livestock $ 455 $ 536 (15 )% (17 )% 2 %
Companion Animal 169 184 (8 )% (14 )% 6 %
Total
International Revenue $ 624 $
720 (13 )% (16 )%
3 % Livestock: Cattle $ 479 $ 540 (11
)% (10 )% (1 )% Swine 173 199 (13 )% (9 )% (4 )% Poultry 126 140
(10 )% (10 )% — % Other 25 25 — % (19 )% 19 %
Total Livestock Revenue $ 803 $
904 (11 )% (10 )%
(1 )% Companion Animal: Horses $ 45 $
55 (18 )% (5 )% (13 )% Dogs and Cats 412 350 18 % (7
)% 25 %
Total Companion Animal Revenue $ 457
$ 405 13 % (6
)% 19 % (a) Beginning in the
second quarter of 2015, we changed our segment reporting structure.
The prior period presentation has been revised to reflect the new
segment reporting structure. Certain amounts and percentages
may reflect rounding adjustments.
ZOETIS INC.
CONSOLIDATED REVENUE BY SEGMENT(a) AND
SPECIES
(UNAUDITED)
(millions of dollars)
Full Year %
Change 2015 2014 Total
Foreign
Exchange
Operational
Revenue: Livestock $ 2,958 $ 3,103
(5 )% (9 )% 4 % Companion Animal 1,756 1,632 8 % (6 )% 14 %
Contract Manufacturing 51 50 2 % (9 )% 11 %
Total
Revenue $ 4,765 $ 4,785
— % (8 )% 8 %
U.S. Livestock $ 1,251 $ 1,163 8 % — % 8 % Companion
Animal 1,077 896 20 % — % 20 %
Total U.S.
Revenue $ 2,328 $ 2,059
13 % — % 13 %
International Livestock $ 1,707 $ 1,940 (12 )% (15 )%
3 % Companion Animal 679 736 (8 )% (15 )% 7 %
Total International Revenue $ 2,386
$ 2,676 (11 )% (15
)% 4 % Livestock: Cattle $ 1,680
$ 1,747 (4 )% (9 )% 5 % Swine 668 695 (4 )% (9 )% 5 % Poultry 525
568 (8 )% (9 )% 1 % Other 85 93 (9 )% (16 )% 7 %
Total Livestock Revenue $ 2,958
$ 3,103 (5 )% (9
)% 4 % Companion Animal: Horses
$ 162 $ 182 (11 )% (6 )% (5 )% Dogs and Cats 1,594 1,450
10 % (7 )% 17 %
Total Companion Animal Revenue
$ 1,756 $ 1,632 8
% (6 )% 14 % (a)
Beginning in the second quarter of 2015, we changed our segment
reporting structure. The prior period presentation has been revised
to reflect the new segment reporting structure. Certain
amounts and percentages may reflect rounding adjustments.
ZOETIS INC.
CONSOLIDATED REVENUE BY KEY INTERNATIONAL
MARKETS
(UNAUDITED)
(millions of dollars)
Fourth Quarter
% Change 2015 2014 Total
Foreign
Exchange
Operational
Total International
$ 624 $ 720
(13 )% (16 )% 3 %
Australia 35
48 (27 )% (18 )% (9 )%
Brazil 65 93 (30 )% (40 )% 10 %
Canada 55 60 (8 )% (14 )% 6 %
China 29 27 7 % (7 )%
14 %
France 31 37 (16 )% (10 )% (6 )%
Germany 34 43
(21 )% (12 )% (9 )%
Italy 24 27 (11 )% (15 )% 4 %
Japan 26 26 — % (10 )% 10 %
Mexico 20 22 (9 )% (26 )%
17 %
Spain 26 23 13 % (15 )% 28 %
United Kingdom 46
44 5 % (3 )% 8 %
Other Developed 77 84 (8 )% (12 )% 4 %
Other Emerging 156 186 (16 )% (13 )% (3 )% Full Year
% Change 2015 2014 Total
Foreign
Exchange
Operational
Total International
$ 2,386 $ 2,676
(11 )% (15 )% 4 %
Australia 144 173 (17 )% (17
)% — %
Brazil 250 310 (19 )% (30 )% 11 %
Canada 172
191 (10 )% (13 )% 3 %
China 123 107 15 % (2 )% 17 %
France 108 151 (28 )% (13 )% (15 )%
Germany 120 150
(20 )% (16 )% (4 )%
Italy 90 104 (13 )% (16 )% 3 %
Japan 101 104 (3 )% (14 )% 11 %
Mexico 75 84 (11 )%
(18 )% 7 %
Spain 86 91 (5 )% (18 )% 13 %
United
Kingdom 168 166 1 % (8 )% 9 %
Other Developed 288 326
(12 )% (14 )% 2 %
Other Emerging 661 719 (8 )% (10 )% 2 %
Certain amounts and percentages may
reflect rounding adjustments.
ZOETIS INC.
SEGMENT(a) EARNINGS
(UNAUDITED)
(millions of dollars)
Fourth Quarter
% Change 2015 2014 Total
Foreign
Exchange
Operational
U.S.:
Revenue $ 636 $ 589 8 % —
%
8 % Cost of Sales 152 138 10 % — % 10 % Gross Profit
484 450 8 % — % 8 % Gross Margin 76.1 % 76.4 % Operating Expenses
115 123 (7 )% — % (7 )% Other (income)/deductions (1 ) — * *
*
U.S. Earnings $ 370 $ 327
13 % — % 13 %
International:
Revenue $ 624 $ 720 (13 )% (16 )% 3 % Cost of Sales 235 263
(11 )% (14 )% 3 % Gross Profit 389 457 (15 )% (18 )% 3 %
Gross Margin 62.3 % 63.5 % Operating Expenses 147 195 (25 )% (13 )%
(12 )% Other (income)/deductions (8 ) (3 ) * * *
International
Earnings $ 250 $ 265 (6
)% (20 )% 14 % Total
Reportable Segments $ 620 $ 592
5 % (9 )% 14 %
Other business activities(b) (85 ) (94 ) (10 )% Reconciling Items:
Corporate(c) (214 ) (170 ) 26 % Purchase accounting adjustments(d)
(16 ) (13 ) 23 % Acquisition-related costs(e) (10 ) (3 ) * Certain
significant items(f) (186 ) (78 ) * Other unallocated(g) (40 ) (79
) (49 )%
Total Earnings(h) $ 69 $ 155
(55 )% * Calculation not meaningful (a) Beginning in
the second quarter of 2015, we changed our segment reporting
structure and recategorized certain costs that are not allocated to
our operating segments. The prior period presentation has been
revised to reflect the new segment reporting structure. (b)
Other business activities reflect the research and development
costs managed by our Research and Development organization as well
as our contract manufacturing business. (c) Corporate
includes, among other things, administration expenses, interest
expense, certain compensation and other costs not charged to our
operating segments. (d) Purchase accounting adjustments
include certain charges related to intangible assets and property,
plant and equipment not charged to our operating segments.
(e) Acquisition-related costs can include costs associated with
acquiring, integrating and restructuring newly acquired businesses,
such as transaction costs, integration costs, restructuring charges
and additional depreciation associated with asset restructuring.
(f) Certain significant items includes substantive, unusual
items that, either as a result of their nature or size, would not
be expected to occur as part of our normal business on a regular
basis. Such items primarily include certain costs related to
becoming an independent public company, restructuring charges and
implementation costs associated with our
cost-reduction/productivity initiatives that are not associated
with an acquisition, costs associated with the operational
efficiency initiative, certain legal and commercial settlements,
and the impact of divestiture-related gains and losses. (g)
Includes overhead expenses associated with our manufacturing and
supply operations not directly attributable to an operating
segment, as well as procurement costs. (h) Defined as income
before provision for taxes on income. Certain amounts and
percentages may reflect rounding adjustments.
ZOETIS INC.
SEGMENT(a) EARNINGS
(UNAUDITED)
(millions of dollars)
Full Year %
Change 2015 2014 Total
Foreign
Exchange
Operational
U.S.: Revenue $ 2,328 $ 2,059 13 %
—
%
13 % Cost of Sales 551 482 14 % — % 14 % Gross Profit
1,777 1,577 13 % — % 13 % Gross Margin 76.3 % 76.6 % Operating
Expenses 389 401 (3 )% — % (3 )% Other (income)/deductions (2 ) —
* * *
U.S. Earnings $ 1,390 $
1,176 18 % — % 18
%
International:
Revenue $ 2,386 $ 2,676 (11 )% (15 )% 4 % Cost of Sales 873
964 (9 )% (11 )% 2 % Gross Profit 1,513 1,712 (12 )% (17 )%
5 % Gross Margin 63.4 % 64.0 % Operating Expenses 570 685 (17 )%
(14 )% (3 )% Other (income)/deductions 2 2 — % (43 )%
43 %
International Earnings $ 941 $
1,025 (8 )% (18 )% 10
% Total Reportable Segments $
2,331 $ 2,201 6 % (8
)% 14 % Other business activities(b)
(293 ) (318 ) (8 )% Reconciling Items: Corporate(c) (606 ) (559 ) 8
% Purchase accounting adjustments(d) (57 ) (51 ) 12 %
Acquisition-related costs(e) (21 ) (8 ) * Certain significant
items(f) (592 ) (205 ) * Other unallocated(g) (217 ) (240 ) (10 )%
Total Earnings(h) $ 545 $
820 (34 )% * Calculation not meaningful
(a) Beginning in the second quarter of 2015, we changed our
segment reporting structure and recategorized certain costs that
are not allocated to our operating segments. The prior period
presentation has been revised to reflect the new segment reporting
structure. (b) Other business activities reflect the
research and development costs managed by our Research and
Development organization as well as our contract manufacturing
business. (c) Corporate includes, among other things,
administration expenses, interest expense, certain compensation and
other costs not charged to our operating segments. (d)
Purchase accounting adjustments include certain charges related to
intangible assets and property, plant and equipment not charged to
our operating segments. (e) Acquisition-related costs can
include costs associated with acquiring, integrating and
restructuring newly acquired businesses, such as transaction costs,
integration costs, restructuring charges and additional
depreciation associated with asset restructuring. (f)
Certain significant items includes substantive, unusual items that,
either as a result of their nature or size, would not be expected
to occur as part of our normal business on a regular basis. Such
items primarily include certain costs related to becoming an
independent public company, restructuring charges and
implementation costs associated with our
cost-reduction/productivity initiatives that are not associated
with an acquisition, costs associated with the operational
efficiency initiative, certain legal and commercial settlements,
and the impact of divestiture-related gains and losses. (g)
Includes overhead expenses associated with our manufacturing and
supply operations not directly attributable to an operating
segment, as well as procurement costs. (h) Defined as income
before provision for taxes on income. Certain amounts and
percentages may reflect rounding adjustments.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160216005906/en/
Zoetis Inc.Media:Bill Price, 1-973-443-2742
(o)william.price@zoetis.comorElinore White, 1-973-443-2835
(o)elinore.y.white@zoetis.comorInvestors:John O'Connor, 1-973-822-7088
(o)john.oconnor@zoetis.comorSteve Frank, 1-973-822-7141
(o)steve.frank@zoetis.com
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