Integration on track; operating cost synergy expectations increased
Pipeline progression continues with FDA approval of XIIDRA for dry eye disease
August 2, 2016 – Shire plc (“Shire”) (LSE: SHP, NASDAQ: SHPG) announces unaudited results for the three months ended June 30, 2016, inclusive of the Baxalta transaction that closed on June 3, 2016.
|Financial Highlights||Q2 2016(1)||Growth(1)||Non GAAP CER(1)(2)|
|Product sales||$2,322 million||+57%||+58%|
|Product sales excluding Baxalta products||$1,763 million||+19%||+20%|
|Total revenues||$2,429 million||+56%||+57%|
|US GAAP operating income from continuing operations||$96 million||(27%)|
|Non GAAP operating income(2)||$972 million||+58%||+57%|
|US GAAP net income margin(3)||(7) %||(17pps)(4)|
|Non GAAP EBITDA margin(2)||40%||+1pps|
|US GAAP net loss||($162 million)||(202%)|
|Non GAAP net income(2)||$773 million||+48%|
|US GAAP diluted losses per ADS||($0.71)||(188%)|
|Non GAAP diluted earnings per ADS(2)||$3.38||+29%||+28%|
|US GAAP net cash provided by operating activities||$591 million||+31%|
|Non GAAP cash generation(2)||$853 million||+69%|
|Non GAAP free cash flow(2)||$464 million||+7%|
(1) Results include Baxalta Inc. (“Baxalta”) (acquired on June 3, 2016) and Dyax Corp. (“Dyax”) (acquired on January 22, 2016). Percentages compare to equivalent 2015 period.
(2) The Non GAAP financial measures included within this release are explained on pages 27 – 28, and are reconciled to the most directly comparable financial measures prepared in accordance with US GAAP on pages 22 – 23.
(3) US GAAP net income as a percentage of total revenues.
(4) Percentage point change (“pps”).
Q2 2016 and Recent Highlights:
Flemming Ornskov, M.D., M.P.H., Chief Executive Officer, commented:
“The second quarter marked an important milestone in Shire’s history, as we completed the combination with Baxalta to create the leading global biotechnology company focused on serving people with rare diseases and other highly specialized conditions. While closing this transformative deal and making significant progress on integration, we have delivered strong double-digit revenue growth from our legacy Shire franchises, and for the first time our results reflect a significant contribution from the legacy Baxalta franchises – allowing us to upgrade our guidance for full year 2016.
“In addition, we have advanced key assets in development and have a robust, innovative clinical pipeline with approximately 40 programs focused on areas of significant unmet medical need. We were pleased to receive approval from the FDA for XIIDRA, the first FDA-approved treatment for the signs and symptoms of dry eye disease and the first product in our developing franchise in ophthalmics. We also received a positive CHMP opinion for ONIVYDE, and completed the decentralized procedure to support European approval of CUVITRU, expanding therapeutic options within our Immunology portfolio. Lastly, we are on track for an FDA resubmission for SHP465 later this year to strengthen our ADHD product offerings.
“Baxalta integration activities continue to progress very well and, with our new operating structure in place, we are raising our operating cost synergy expectations by 40% to at least $700 million in year three post close. This would not have been possible without the commitment of all our employees, who have worked tirelessly in recent months to help drive efficiencies across the business, so that we can continue to deliver best-in-class therapies to patients around the world. We remain resolutely focused on achieving our goals, and I am very confident that Shire will continue to deliver strong growth as we integrate Baxalta and advance our combined portfolio of products.”
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Dial in details for the live conference call for investors at 14:00 BST / 09:00 EDT on August 2, 2016:
|UK dial in:||0808 237 0030 or 020 3139 4830|
|US dial in:||1 866 928 7517 or 1 718 873 9077|
|International Access Numbers:||Click here|
|Live Webcast:||Click here|
Stephen Williams, Deputy Company Secretary (responsible for arranging the release of this announcement).
This announcement contains inside information.
Shire is the leading global biotechnology company focused on serving people with rare diseases and other highly specialized conditions. We strive to develop best-in-class products, many of which are available in more than 100 countries, across core therapeutic areas including Hematology, Immunology, Neuroscience, Ophthalmics, Lysosomal Storage Disorders, Gastrointestinal / Internal Medicine / Endocrine and Hereditary Angioedema; and a growing franchise in Oncology.
Our employees come to work every day with a shared mission: to develop and deliver breakthrough therapies for the hundreds of millions of people in the world affected by rare diseases and other high-need conditions, and who lack effective therapies to live their lives to the fullest.
THE “SAFE HARBOR” STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
Statements included herein that are not historical facts, including without limitation statements concerning future strategy, plans, objectives, expectations and intentions, the anticipated timing of clinical trials and approvals for, and the commercial potential of, inline or pipeline products are forward-looking statements. Such forward-looking statements involve a number of risks and uncertainties and are subject to change at any time. In the event such risks or uncertainties materialize, Shire’s results could be materially adversely affected. The risks and uncertainties include, but are not limited to, the following:
other risks and uncertainties detailed from time to time in Shire’s filings with the Securities and Exchange Commission, including those risks outlined in “ITEM 1A: Risk Factors” in Shire’s Annual Report on Form 10-K for the year ended December 31, 2015.
All forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by this cautionary statement. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof. Except to the extent otherwise required by applicable law, we do not undertake any obligation to update or revise forward-looking statements, whether as a result of new information, future events or otherwise.