- Continues Turnaround with Takeda's Growth Drivers: Gastroenterology, Oncology and Emerging Markets
Results of April to December period reaffirms full-year management guidance
· Underlying revenue +3.8% year-to-year (reported revenue growing +4.0% to 1,393.3 billion yen), led by strong performance in the U.S. and the emerging markets
· Underlying Core Earnings +1.5% year-to-year (operating profit -15.9% to 167.5 billion yen)
· Underlying Core EPS +17.3% year-to year (reported EPS growing +43% to 145 yen)
Contribution of Takeda's growth drivers
· Consolidated underlying revenue of gastroenterology, oncology and emerging markets - Takeda's growth drivers - is +8.5% year-to-year
· Gastroenterology underlying revenue +24.7%, oncology up +0.4% year-to-year
· Emerging markets underlying revenue +5.7% year-to-year, with particularly strong contributions from Russia and China
Growth of innovative new products to offset loss of exclusivity impact
· ENTYVIO® is on the way to over $2 bln in peak sales, BRINTELLIX® and ADCETRIS® show steady growth
· AZILVA® and LOTRIGA® are contributing to Japan business.
Efficiency gains continue
· Project Summit achieved 21 billion yen of cost savings in the April-December 2015 period, exceeding the full-year target
For FY2015 full year reported forecast, operating profit upgraded, others unchanged
· Based on performance through three quarters, Takeda raised the full year reported forecast for operating profit to 120 billion yen
Affirming management guidance in FY2015
· Low single-digit underlying revenue growth in FY2015, with underlying core earnings growth higher than underlying revenue growth, and underlying core EPS growth higher than underlying core earnings growth
Christophe Weber, President and Chief Executive Officer of Takeda, commented:
“Through three quarters (April to December) of FY2015, Takeda's turnaround continues, with underlying revenue growth of +3.8% year-to-year, led by our growth drivers of gastroenterology, oncology and emerging markets. With the global launch of new products such as ENTYVIO and NINLARO, Takeda is on the right track to deliver revenue growth and improved profitability. On the basis of our three quarters results, we confirm our full-year management guidance.”
Key figures for three quarters of FY2015 (To view the table, please visit http://goo.gl/fpiVhJ)
1 Core Earnings is calculated from operating profit by excluding the impact of exceptional items, such as purchase accounting, amortization and impairment loss of intangible assets, restructuring costs and major litigation costs.
2 Underlying performance aims at understanding the real performance of the business. Underlying Revenue and Underlying Core Earnings excludes the same as above and adjusted for acquisitions/divestments and foreign exchange.
3 Attributable to the owners of the company
Underlying revenue growth in the 3Q (April to December, 2015) was +3.8% year-to-year, Underlying Core Earnings was +1.5% and Underlying Core EPS was +17.3%, with no change in Takeda's management guidance for FY2015. Reported revenue grew +4.0% year-to-year to 1,393.3 billion yen. An increase in expenses to new global products as well as a decrease in other income such as reversal of COLCRYS® contingent consideration and gain from sales of real estate in 2014, resulted in a year-to-year decline in Operating Profit by 31.6 billion yen. Despite the decrease in operating profit, consolidated net profit was 113.6 billion yen, an increase of 33.9 billion yen (+42.5% year-to-year), mainly due to the decrease in income tax expenses.
Underlying revenue growth was mainly driven by Takeda‘s growth drivers; gastroenterology, oncology and emerging markets. The three account for almost 50% of Takeda’s revenue. Gastroenterology grew by +24.7% year-to-year, driven by ENTYVIO®. Oncology revenue, including VELCADE® and ADCETRIS®, increased by +0.4%. Launched in the U.S. in December, NINLARO®, a highly innovative once-weekly capsule for multiple myeloma, is expected to provide a significant contribution to Takeda's mid- to long-term sustained growth. Emerging Markets revenue grew by +5.7% year-to-year, led by Value Brands (branded generics and Over-The-Counter medicines), with strong growth in Russia and China. Performance in the U.S. (+11.6% year-to-year underlying revenue growth) also contributed to revenue growth. In Japan, under the increasing generic pressure, underlying revenue declined -1.7% year-to-year, but the year-to-year revenue declines moderated, led by the contribution of AZILVA® and LOTRIGA®.
Project Summit - a company-wide strategic initiative to increase efficiency - continued to produce results, with 21 billion yen savings in the three quarters period, exceeding the full year target.
ENTYVIO® and NINLARO® are expected to be key global contributors to Takeda‘s sales growth. In Japan, a new business venture with Teva Pharmaceutical Industries Ltd. will be established in or after April 2016 to deliver Teva’s high-quality generic medicines and Takeda's long-listed products to patients. It is expected to meet wide-ranged needs of patients and correspond to the growing importance of generics in Japan, while Takeda will further focus on innovative new medicines, such as AZILVA®, LOTRIGA®, TAKECAB®, NESINA® and ZAFATEK®.
As part of its ongoing effort to improve the R&D productivity, Takeda announced that its top priority is to be a leader in three therapeutic areas, Oncology, Gastroenterology and Central Nervous System. In addition, it will deliver maximum, targeted value in Specialty CV and an innovative business and global health approach in Vaccines.
Takeda affirmed its management guidance for FY2015, leading to long-term sales and profit growth, and raised the full-year reported forecast of operating profit to 120 billion yen, based on the three quarters' results.
Management Guidance for FY2015 (To view the table, please visit http://goo.gl/fpiVhJ)
FY2015 full year reported forecast: operating profit revised, others unchanged (To view the table, please visit http://goo.gl/fpiVhJ)
For more details on Takeda’s FY2015 3Q results and other financial information, please visit http://www.takeda.com/investor-information/results/
About Takeda Pharmaceutical Company Limited
Located in Osaka, Japan, Takeda (TOKYO:4502) is a research-based global company with its main focus on pharmaceuticals. As the largest pharmaceutical company in Japan and one of the global leaders of the industry, Takeda is committed to strive towards better health for people worldwide through leading innovation in medicine. Information about Takeda is available on www.takeda.com.
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