Sunday, February 4, 2018

Takeda Reports 3rd Quarter FY2017 Results

 Continued strong performance delivering double-digit earnings growth year-to-date; raising full-year guidance with Core Earnings margin expansion now projected at 300bps



OSAKA, Japan-Friday, February 2nd 2018 [ AETOS Wire ]

(BUSINESS WIRE) -- Takeda Pharmaceutical Company Limited (TOKYO:4502):

Underlying Revenue growth +6.7% led by Takeda's Growth Drivers

    Underlying Revenue grew +6.7% year-to-date, with Takeda's Growth Drivers (Gastroenterology, Oncology, Neuroscience and Emerging Markets) posting strong underlying revenue growth of +14.5%.
        Gastroenterology +23.7% fueled by market share growth of ENTYVIO® and TAKECAB®.
        Oncology +13.8% driven by the expansion of NINLARO® and ADCETRIS®, and the addition of revenue from ICLUSIG® and ALUNBRIG®.
        Neuroscience +26.4% led by robust growth of TRINTELLIX® in the U.S.
        Emerging Markets +1.9% with strong performance in Russia and Brazil offsetting temporary declines in China and the Middle East.
    Underlying Revenue performance was driven by double-digit growth in the U.S. (U.S. +17.0%, Japan +1.3%, Europe & Canada +4.9%).
    Reported revenue grew +4.1%, with the positive contribution from Takeda's Growth Drivers and favorable currency impact (+3.4pp) more than offsetting the negative impact of divestitures (-5.9pp).

Double-digit EPS growth reflecting strong revenue growth and progress of Global Opex Initiative

    Underlying Core Earnings grew +32.8%, reflecting strong revenue growth and margin step-up of 3.9pp (+2.3pp gross margin; +1.6pp from OPEX margin).
    Reported operating profit was up +48.2%, driven mainly by Core Earnings growth. It also includes one-time gains of 136.9 billion yen, including the sale of shares held in Wako Pure Chemical Ltd., disposal of real estate, and the transfer of additional long-listed products to Teva Takeda Yakuhin Ltd.
    Underlying Core EPS was up +25.8%, and reported EPS increased +45.5% to 309 yen per share.

Net leverage improved due to steady progress on cash flow

    Year-to-date Operating Free Cash Flow increased +25.1% to 152.1 billion yen, and the disposal of non-core assets generated an additional 142.9 billion yen of cash.
    Net Debt / EBITDA dropped to 1.9x from 2.7x in March 2017.

James Kehoe, Chief Financial Officer, commented:
"Our Growth Drivers continued to power ahead and, together with our cost management initiatives, led to double-digit earnings growth and significant margin expansion. We are updating our full year guidance to reflect higher Velcade sales, and we now project Core Earnings margin expansion of approximately 300bps. Takeda will continue to deliver value to patients and shareholders as we execute against our key mid-term priorities of growing the portfolio, rebuilding the pipeline, and boosting profitability."

Reported Results for Q3 YTD (April - December) FY2017

(billion yen)
   


   

FY2016
Q3 YTD
   


   

FY2017
Q3 YTD
   


   

% Growth vs Prior Year
                 

Reported
   


   

Underlying2

Revenue
         

1,315.8
         

1,369.6
         

+4.1%
         

+6.7%

Core Earnings1
         

228.3
         

292.7
         

+28.2%
         

+32.8%

Operating Profit
         

217.4
         

322.3
         

+48.2%
         

-

Net Profit3
         

165.7
         

240.9
         

+45.4%
         

-

EPS
   


   

212 yen
   


   

309 yen
   


   

+45.5%
   


   

+25.8%



1
   


   

Core Earnings is calculated by deducting SG&A expenses and R&D expenses from reported Gross Profit. In addition, certain other items that are non-core in nature and significant in value may also be adjusted.

2
         

Underlying growth compares two periods of financial results on a common basis, showing the ongoing performance of the business excluding the impact of foreign exchange and divestitures.

3
         

Attributable to the owners of the company.



FY2017 Management Guidance: Raising full year underlying guidance to reflect higher Velcade sales;
now projecting Core Earnings growth in the "high twenties"


   


   

Previous Guidance (growth %)
(Nov 1, 2017)
   


   

Revised Guidance (growth %)
(Feb 1, 2018)

Underlying Revenue
         

Low single digit
         

Mid single digit

Underlying Core Earnings
         

High teen
         

High twenties

Underlying Core EPS
         

Mid teen
         

Mid twenties

Annual Dividend per Share
   


   

180 yen
   


   

180 yen





FY2017 Reported Forecast: Raising revenue & profit forecast to reflect Velcade upside;
EPS growth now at 36.9%. Forecast includes impacts from US Tax Legislation and Teva JV impairment

(billion yen)
   


   

Previous Forecast
(Nov 1, 2017)
   


   

Revised Forecast
(Feb 1, 2018)
   


   

vs. FY2016

Revenue
         

1,720.0
               

1,745.0
               

+0.7%
   

Core Earnings
         

267.5
               

289.5
               

+18.1%
   

Operating Profit
         

200.0
               

218.7
               

+40.3%
   

Net Profit
         

152.0
               

157.3
               

+36.9%
   

EPS
         

195 yen
   


         

201 yen
   


         

+36.9%
   



Exchange Rate (annual average)
   


   

1 US$=112 yen

1 euro=129 yen
   


   

1 US$=112 yen

1 euro=130 yen
   


   





For more details on Takeda's FY2017 3rd quarter results and other financial information, please visit https://www.takeda.com/investors/reports/

About Takeda Pharmaceutical Company Limited
Takeda Pharmaceutical Company Limited is a global, research and development-driven pharmaceutical company committed to bringing better health and a brighter future to patients by translating science into life-changing medicines. Takeda focuses its R&D efforts on oncology, gastroenterology and neuroscience therapeutic areas plus vaccines. Takeda conducts R&D both internally and with partners to stay at the leading edge of innovation. Innovative products, especially in oncology and gastroenterology, as well as Takeda’s presence in emerging markets, are currently fueling the growth of Takeda. Approximately 30,000 Takeda employees are committed to improving quality of life for patients, working with Takeda’s partners in health care in more than 70 countries. For more information, visit https://www.takeda.com/newsroom/.

Contacts

Investor Relations
Takeda Pharmaceutical Company Limited
Takashi Okubo, +81-(0)3-3278-2306
takeda.ir.contact@takeda.com
Media Relations
Takeda Pharmaceutical Company Limited
Kazumi Kobayashi, +81 (0)3-3278-2095
kazumi.kobayashi@takeda.com



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