Eli Lilly misses by $0.01, reports revs in-line; reaffirms FY14 EPS guidance, lowers high end of FY14 revs guidance
Reports Q3 (Sep) earnings of $0.66 per share, excluding non-recurring items, $0.01 worse than the Capital IQ Consensus Estimate of $0.67; revenues fell 15.5% year/year to $4.88 bln vs the $4.84 bln consensus.
- The revenue decline was comprised of 16 percent due to lower volume; the impact of changes in price and foreign exchange rates on worldwide revenue was negligible. The 16 percent decrease in worldwide volume was primarily driven by the loss of U.S. patent exclusivity for Cymbalta, and to a lesser extent Evista, partially offset by volume gains for most other products. Total revenue in the U.S. decreased 33 percent to $2.218 billion, driven primarily by lower demand for Cymbalta and Evista following their patent expirations. Total revenue outside the U.S. increased 8 percent to $2.658 billion, driven by higher volume.
- Patent expirations have led to a rapid and severe decline in U.S. Cymbalta and U.S. Evista sales. These revenue declines are expected to be partially offset by growth from a portfolio of other products including Humalog, Humulin, Trajenta®, Cialis, Forteo and Alimta, as well as the animal health business and new product launches. In addition, strong revenue growth is expected in China, while a weaker Japanese yen will dampen revenue growth in Japan.
- The co now anticipates gross margin as a percent of revenue will be ~74.5 percent in 2014 driven by recent strengthening of the U.S. Dollar versus the Euro. Gross margin in 2014 is now also expected to benefit from a decision to delay until 2015 the shutdown at one of the company's bulk insulin plants to implement production changes. T