"With strong volume-driven growth for our recently launched products and a promising new product pipeline, we are well positioned for future growth," said
$Millions, except EPS and percentages |
Q4'17 |
Q4'16 |
YOY Δ |
FY '17 |
FY '16 |
YOY Δ |
||||||
Total Revenues |
$ 5,802 |
$ 5,965 |
(3%) |
$ 22,849 |
$ 22,991 |
(1%) |
||||||
GAAP Operating Income |
$ 2,245 |
$ 2,485 |
(10%) |
$ 9,973 |
$ 9,794 |
2% |
||||||
GAAP Net (Loss) Income |
$ (4,264) |
$ 1,935 |
* |
$ 1,979 |
$ 7,722 |
(74%) |
||||||
GAAP (Loss) Earnings Per Share |
$ (5.89) |
$ 2.59 |
* |
$ 2.69 |
$ 10.24 |
(74%) |
||||||
Non-GAAP Operating Income |
$ 2,555 |
$ 2,859 |
(11%) |
$ 11,658 |
$ 11,446 |
2% |
||||||
Non-GAAP Net Income |
$ 2,104 |
$ 2,160 |
(3%) |
$ 9,246 |
$ 8,785 |
5% |
||||||
Non-GAAP EPS |
$ 2.89 |
$ 2.89 |
0% |
$ 12.58 |
$ 11.65 |
8% |
||||||
* Change in excess of 100% |
References in this release to "non-GAAP" measures, measures presented "on a non-GAAP basis" and to "free cash flow" (computed by subtracting capital expenditures from operating cash flow) refer to non-GAAP financial measures. Adjustments to the most directly comparable GAAP financial measures and other items are presented on the attached reconciliations. |
Product Sales Performance
Product Sales Detail by Product and Geographic Region
$Millions, except percentages |
Q4'17 |
Q4'16 |
YOY Δ |
||||||
US |
ROW |
TOTAL |
TOTAL |
TOTAL |
|||||
Repatha® |
$70 |
$28 |
$98 |
$58 |
69% |
||||
BLINCYTO® |
29 |
17 |
46 |
29 |
59% |
||||
Prolia® |
369 |
205 |
574 |
463 |
24% |
||||
KYPROLIS® |
150 |
77 |
227 |
183 |
24% |
||||
Vectibix® |
63 |
96 |
159 |
143 |
11% |
||||
Nplate® |
100 |
65 |
165 |
150 |
10% |
||||
XGEVA® |
285 |
106 |
391 |
376 |
4% |
||||
Sensipar® / Mimpara® |
322 |
91 |
413 |
411 |
0% |
||||
Neulasta® |
969 |
145 |
1,114 |
1,116 |
0% |
||||
Aranesp® |
263 |
228 |
491 |
526 |
(7%) |
||||
Enbrel® |
1,368 |
55 |
1,423 |
1,644 |
(13%) |
||||
EPOGEN® |
270 |
0 |
270 |
316 |
(15%) |
||||
NEUPOGEN® |
82 |
44 |
126 |
173 |
(27%) |
||||
Other* |
13 |
59 |
72 |
75 |
(4%) |
||||
Total product sales |
$4,353 |
$1,216 |
$5,569 |
$5,663 |
(2%) |
||||
* Other includes Bergamo, MN Pharma, IMLYGIC®, Corlanor®, and Parsabiv™ |
|||||||||
$Millions, except percentages |
FY'17 |
FY'16 |
YOY Δ |
||||||
US |
ROW |
TOTAL |
TOTAL |
TOTAL |
|||||
Repatha® |
$225 |
$94 |
$319 |
$141 |
* |
||||
BLINCYTO® |
114 |
61 |
175 |
115 |
52% |
||||
Prolia® |
1,272 |
696 |
1,968 |
1,635 |
20% |
||||
KYPROLIS® |
562 |
273 |
835 |
692 |
21% |
||||
Nplate® |
392 |
250 |
642 |
584 |
10% |
||||
Sensipar® / Mimpara® |
1,374 |
344 |
1,718 |
1,582 |
9% |
||||
Vectibix® |
251 |
391 |
642 |
611 |
5% |
||||
XGEVA® |
1,157 |
418 |
1,575 |
1,529 |
3% |
||||
Aranesp® |
1,114 |
939 |
2,053 |
2,093 |
(2%) |
||||
Neulasta® |
3,931 |
603 |
4,534 |
4,648 |
(2%) |
||||
Enbrel® |
5,206 |
227 |
5,433 |
5,965 |
(9%) |
||||
EPOGEN® |
1,096 |
0 |
1,096 |
1,282 |
(15%) |
||||
NEUPOGEN® |
369 |
180 |
549 |
765 |
(28%) |
||||
Other** |
68 |
188 |
256 |
250 |
2% |
||||
Total product sales |
$17,131 |
$4,664 |
$21,795 |
$21,892 |
0% |
||||
* Change in excess of 100% |
|||||||||
** Other includes Bergamo, MN Pharma, IMLYGIC®, Corlanor®, and Parsabiv™ |
|||||||||
Operating Expense, Operating Margin and Tax Rate Analysis
On a GAAP basis:
On a non-GAAP basis:
$Millions, except percentages |
||||||||||||||
GAAP |
Non-GAAP |
|||||||||||||
Q4'17 |
Q4'16 |
YOY Δ |
Q4'17 |
Q4'16 |
YOY Δ |
|||||||||
Cost of Sales |
$1,059 |
$1,067 |
(1%) |
$816 |
$753 |
8% |
||||||||
% of product sales |
19.0% |
18.8% |
0.2 pts. |
14.7% |
13.3% |
1.4 pts. |
||||||||
Research & Development |
$1,043 |
$1,078 |
(3%) |
$1,025 |
$1,056 |
(3%) |
||||||||
% of product sales |
18.7% |
19.0% |
(0.3) pts. |
18.4% |
18.6% |
(0.2) pts. |
||||||||
Selling, General & Administrative |
$1,427 |
$1,323 |
8% |
$1,406 |
$1,297 |
8% |
||||||||
% of product sales |
25.6% |
23.4% |
2.2 pts. |
25.2% |
22.9% |
2.3 pts. |
||||||||
Other |
$28 |
$12 |
* |
$0 |
$0 |
NM |
||||||||
TOTAL Operating Expenses |
$3,557 |
$3,480 |
2% |
$3,247 |
$3,106 |
5% |
||||||||
Operating Margin |
||||||||||||||
operating income as a % of product sales |
40.3% |
43.9% |
(3.6) pts. |
45.9% |
50.5% |
(4.6) pts. |
||||||||
Tax Rate |
292.6% |
15.2% |
277.4 pts. |
16.6% |
18.7% |
(2.1) pts. |
||||||||
* Change in excess of 100% |
||||||||||||||
NM: Not Meaningful |
||||||||||||||
pts: percentage points |
||||||||||||||
$Millions, except percentages |
||||||||||||||
GAAP |
Non-GAAP |
|||||||||||||
FY'17 |
FY'16 |
YOY Δ |
FY'17 |
FY'16 |
YOY Δ |
|||||||||
Cost of Sales |
$4,069 |
$4,162 |
(2%) |
$2,943 |
$2,913 |
1% |
||||||||
% of product sales |
18.7% |
19.0% |
(0.3) pts. |
13.5% |
13.3% |
0.2 pts. |
||||||||
Research & Development |
$3,562 |
$3,840 |
(7%) |
$3,482 |
$3,755 |
(7%) |
||||||||
% of product sales |
16.3% |
17.5% |
(1.2) pts. |
16.0% |
17.2% |
(1.2) pts. |
||||||||
Selling, General & Administrative |
$4,870 |
$5,062 |
(4%) |
$4,766 |
$4,877 |
(2%) |
||||||||
% of product sales |
22.3% |
23.1% |
(0.8) pts. |
21.9% |
22.3% |
(0.4) pts. |
||||||||
Other |
$375 |
$133 |
* |
$0 |
$0 |
NM |
||||||||
TOTAL Operating Expenses |
$12,876 |
$13,197 |
(2%) |
$11,191 |
$11,545 |
(3%) |
||||||||
Operating Margin |
||||||||||||||
operating income as a % of product sales |
45.8% |
44.7% |
1.1 pts. |
53.5% |
52.3% |
1.2 pts. |
||||||||
Tax Rate |
79.4% |
15.7% |
63.7 pts. |
18.0% |
18.8% |
(0.8) pts. |
||||||||
* Change in excess of 100% |
||||||||||||||
NM: Not Meaningful |
||||||||||||||
pts: percentage points |
Cash Flow and Balance Sheet
$Billions, except shares |
Q4'17 |
Q4'16 |
YOY Δ |
FY'17 |
FY'16 |
YOY Δ |
||||||||
Operating Cash Flow |
$3.0 |
$3.1 |
($0.1) |
$11.2 |
$10.4 |
$0.8 |
||||||||
Capital Expenditures |
0.2 |
0.2 |
(0.1) |
0.7 |
0.7 |
(0.1) |
||||||||
Free Cash Flow |
2.9 |
2.9 |
0.0 |
10.5 |
9.6 |
0.9 |
||||||||
Dividends Paid |
0.8 |
0.7 |
0.1 |
3.4 |
3.0 |
0.4 |
||||||||
Share Repurchase |
0.8 |
1.0 |
(0.2) |
3.1 |
3.0 |
0.1 |
||||||||
Avg. GAAP Diluted Shares (millions) |
724 |
748 |
(24) |
735 |
754 |
(19) |
||||||||
Avg. Non-GAAP Diluted Shares (millions) |
729 |
748 |
(19) |
735 |
754 |
(19) |
||||||||
Cash and Investments |
41.7 |
38.1 |
3.6 |
41.7 |
38.1 |
3.6 |
||||||||
Debt Outstanding |
35.3 |
34.6 |
0.7 |
35.3 |
34.6 |
0.7 |
||||||||
Stockholders' Equity |
25.2 |
29.9 |
(4.6) |
25.2 |
29.9 |
(4.6) |
||||||||
Note: Numbers may not add due to rounding |
Additional Capital Investments in
The Company expects to invest approximately
2018 Guidance
For the full year 2018, the Company expects:
Fourth Quarter Product and Pipeline Update
Key development milestones:
Clinical Program |
Indication |
Projected Milestone |
KYPROLIS |
Relapsed or refractory multiple myeloma |
EU regulatory review (ENDEAVOR OS data) Regulatory reviews (ASPIRE OS data) |
BLINCYTO |
Acute lymphoblastic leukemia |
EU regulatory review (TOWER OS data) Regulatory reviews (MRD-positive) |
XGEVA |
Prevention of SREs in multiple myeloma |
EU regulatory review |
Prolia |
Glucocorticoid-induced osteoporosis |
U.S. regulatory review |
EVENITY™(romosozumab) |
Postmenopausal osteoporosis |
U.S. regulatory resubmission EU regulatory review |
Aimovig™ (erenumab) |
Migraine prevention |
U.S. regulatory review |
ABP 710 |
Oncology |
Phase 3 data |
ABP 980 (biosimilar trastuzumab) |
Oncology |
Regulatory reviews |
OS = overall survival; MRD = minimal residual disease; SRE = skeletal-related event
The Company provided the following updates on selected product and pipeline programs:
Repatha
Tezepelumab
Aimovig
KYPROLIS
XGEVA
Nplate
BLINCYTO
EVENITY
MVASI™ (biosimilar bevacizumab)
EVENITY and Aimovig trade names provisionally approved by
EVENITY is developed in collaboration with UCB globally, as well as our joint venture partner Astellas in
Tezepelumab is developed in collaboration with
Aimovig is developed in collaboration with
Avastin is a registered trademark of Genentech
Non-GAAP Financial Measures
In this news release, management has presented its operating results for the fourth quarters and full years of 2017 and 2016, in accordance with U.S. Generally Accepted Accounting Principles (GAAP) and on a non-GAAP basis. In addition, management has presented its full year 2018 EPS and tax rate guidance in accordance with GAAP and on a non-GAAP basis. These non-GAAP financial measures are computed by excluding certain items related to acquisitions, restructuring and certain other items, including the repatriation tax on accumulated foreign earnings and other impacts of U.S. corporate tax reform, from the related GAAP financial measures. Reconciliations for these non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the news release. Management has also presented Free Cash Flow (FCF), which is a non-GAAP financial measure, for the fourth quarters and full years of 2017 and 2016. FCF is computed by subtracting capital expenditures from operating cash flow, each as determined in accordance with GAAP.
The Company believes that its presentation of non-GAAP financial measures provides useful supplementary information to and facilitates additional analysis by investors. The Company uses certain non-GAAP financial measures to enhance an investor's overall understanding of the financial performance and prospects for the future of the Company's ongoing business activities by facilitating comparisons of results of ongoing business operations among current, past and future periods. The Company believes that FCF provides a further measure of the Company's liquidity.
The Company uses the non-GAAP financial measures set forth in the news release in connection with its own budgeting and financial planning internally to evaluate the performance of the business, including to allocate resources and to evaluate results relative to incentive compensation targets. The non-GAAP financial measures are in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.
About
For more information, visit www.amgen.com and follow us on www.twitter.com/amgen.
Forward-Looking Statements
This news release contains forward-looking statements that are based on the current expectations and beliefs of
No forward-looking statement can be guaranteed and actual results may differ materially from those we project. Our results may be affected by our ability to successfully market both new and existing products domestically and internationally, clinical and regulatory developments involving current and future products, sales growth of recently launched products, competition from other products including biosimilars, difficulties or delays in manufacturing our products and global economic conditions. In addition, sales of our products are affected by pricing pressure, political and public scrutiny and reimbursement policies imposed by third-party payers, including governments, private insurance plans and managed care providers and may be affected by regulatory, clinical and guideline developments and domestic and international trends toward managed care and healthcare cost containment. Furthermore, our research, testing, pricing, marketing and other operations are subject to extensive regulation by domestic and foreign government regulatory authorities. We or others could identify safety, side effects or manufacturing problems with our products, including our devices, after they are on the market. Our business may be impacted by government investigations, litigation and product liability claims. In addition, our business may be impacted by the adoption of new tax legislation or exposure to additional tax liabilities. If we fail to meet the compliance obligations in the corporate integrity agreement between us and the U.S. government, we could become subject to significant sanctions. Further, while we routinely obtain patents for our products and technology, the protection offered by our patents and patent applications may be challenged, invalidated or circumvented by our competitors, or we may fail to prevail in present and future intellectual property litigation. We perform a substantial amount of our commercial manufacturing activities at a few key facilities, including in
Amgen Inc. |
||||||||||
Consolidated Statements of Income - GAAP |
||||||||||
(In millions, except per share data) |
||||||||||
(Unaudited) |
||||||||||
Three months ended |
Years ended |
|||||||||
December 31, |
December 31, |
|||||||||
2017 |
2016 |
2017 |
2016 |
|||||||
Revenues: |
||||||||||
Product sales |
$ 5,569 |
$ 5,663 |
$ 21,795 |
$ 21,892 |
||||||
Other revenues |
233 |
302 |
1,054 |
1,099 |
||||||
Total revenues |
5,802 |
5,965 |
22,849 |
22,991 |
||||||
Operating expenses: |
||||||||||
Cost of sales |
1,059 |
1,067 |
4,069 |
4,162 |
||||||
Research and development |
1,043 |
1,078 |
3,562 |
3,840 |
||||||
Selling, general and administrative |
1,427 |
1,323 |
4,870 |
5,062 |
||||||
Other |
28 |
12 |
375 |
133 |
||||||
Total operating expenses |
3,557 |
3,480 |
12,876 |
13,197 |
||||||
Operating income |
2,245 |
2,485 |
9,973 |
9,794 |
||||||
Interest expense, net |
332 |
328 |
1,304 |
1,260 |
||||||
Interest and other income, net |
301 |
126 |
928 |
629 |
||||||
Income before income taxes |
2,214 |
2,283 |
9,597 |
9,163 |
||||||
Provision for income taxes |
6,478 |
348 |
7,618 |
1,441 |
||||||
Net (loss) income |
$ (4,264) |
$ 1,935 |
$ 1,979 |
$ 7,722 |
||||||
(Loss) earnings per share: |
||||||||||
Basic |
$ (5.89) |
$ 2.61 |
$ 2.71 |
$ 10.32 |
||||||
Diluted |
$ (5.89) |
$ 2.59 |
$ 2.69 |
$ 10.24 |
||||||
Weighted average shares used in calculation of (loss) earnings per share: |
||||||||||
Basic |
724 |
742 |
731 |
748 |
||||||
Diluted |
724 |
748 |
735 |
754 |
Amgen Inc. |
|||||||||
Consolidated Balance Sheets - GAAP |
|||||||||
(In millions) |
|||||||||
December 31, |
|||||||||
2017 |
2016 |
||||||||
Assets |
|||||||||
Current assets: |
|||||||||
Cash, cash equivalents and marketable securities |
$ 41,678 |
$ 38,085 |
|||||||
Trade receivables, net |
3,237 |
3,165 |
|||||||
Inventories |
2,834 |
2,745 |
|||||||
Other current assets |
1,727 |
2,015 |
|||||||
Total current assets |
49,476 |
46,010 |
|||||||
Property, plant and equipment, net |
4,989 |
4,961 |
|||||||
Intangible assets, net |
8,609 |
10,279 |
|||||||
Goodwill |
14,761 |
14,751 |
|||||||
Other assets |
2,119 |
1,625 |
|||||||
Total assets |
$ 79,954 |
$ 77,626 |
|||||||
Liabilities and Stockholders' Equity |
|||||||||
Current liabilities: |
|||||||||
Accounts payable and accrued liabilities |
$ 7,868 |
$ 6,801 |
|||||||
Short-term borrowings and current portion of long-term debt |
1,152 |
4,403 |
|||||||
Total current liabilities |
9,020 |
11,204 |
|||||||
Long-term debt |
34,190 |
30,193 |
|||||||
Long-term deferred tax liabilities |
1,166 |
2,436 |
|||||||
Long-term tax liabilities |
9,099 |
2,419 |
|||||||
Other noncurrent liabilities |
1,238 |
1,499 |
|||||||
Stockholders' equity |
25,241 |
29,875 |
|||||||
Total liabilities and stockholders' equity |
$ 79,954 |
$ 77,626 |
|||||||
Shares outstanding |
722 |
738 |
Amgen Inc. |
|||||||
GAAP to Non-GAAP Reconciliations |
|||||||
(Dollars in millions) |
|||||||
(Unaudited) |
|||||||
Three months ended |
Years ended |
||||||
December 31, |
December 31, |
||||||
2017 |
2016 |
2017 |
2016 |
||||
GAAP cost of sales |
$ 1,059 |
$ 1,067 |
$ 4,069 |
$ 4,162 |
|||
Adjustments to cost of sales: |
|||||||
Acquisition-related expenses (a) |
(243) |
(314) |
(1,126) |
(1,248) |
|||
Certain net charges pursuant to our restructuring initiative |
- |
- |
- |
(1) |
|||
Total adjustments to cost of sales |
(243) |
(314) |
(1,126) |
(1,249) |
|||
Non-GAAP cost of sales |
$ 816 |
$ 753 |
$ 2,943 |
$ 2,913 |
|||
GAAP cost of sales as a percentage of product sales |
19.0% |
18.8% |
18.7% |
19.0% |
|||
Acquisition-related expenses (a) |
-4.3 |
-5.5 |
-5.2 |
-5.7 |
|||
Certain net charges pursuant to our restructuring initiative |
0.0 |
0.0 |
0.0 |
0.0 |
|||
Non-GAAP cost of sales as a percentage of product sales |
14.7% |
13.3% |
13.5% |
13.3% |
|||
GAAP research and development expenses |
$ 1,043 |
$ 1,078 |
$ 3,562 |
$ 3,840 |
|||
Adjustments to research and development expenses: |
|||||||
Acquisition-related expenses (a) |
(20) |
(20) |
(77) |
(78) |
|||
Certain net charges pursuant to our restructuring initiative |
2 |
(2) |
(3) |
(7) |
|||
Total adjustments to research and development expenses |
(18) |
(22) |
(80) |
(85) |
|||
Non-GAAP research and development expenses |
$ 1,025 |
$ 1,056 |
$ 3,482 |
$ 3,755 |
|||
GAAP research and development expenses as a percentage of product sales |
18.7% |
19.0% |
16.3% |
17.5% |
|||
Acquisition-related expenses (a) |
-0.3 |
-0.4 |
-0.3 |
-0.3 |
|||
Certain net charges pursuant to our restructuring initiative |
0.0 |
0.0 |
0.0 |
0.0 |
|||
Non-GAAP research and development expenses as a percentage of product sales |
18.4% |
18.6% |
16.0% |
17.2% |
|||
GAAP selling, general and administrative expenses |
$ 1,427 |
$ 1,323 |
$ 4,870 |
$ 5,062 |
|||
Adjustments to selling, general and administrative expenses: |
|||||||
Acquisition-related expenses (b) |
(20) |
(26) |
(99) |
(180) |
|||
Certain net charges pursuant to our restructuring initiative |
(1) |
- |
(2) |
(5) |
|||
Other |
- |
- |
(3) |
- |
|||
Total adjustments to selling, general and administrative expenses |
(21) |
(26) |
(104) |
(185) |
|||
Non-GAAP selling, general and administrative expenses |
$ 1,406 |
$ 1,297 |
$ 4,766 |
$ 4,877 |
|||
GAAP selling, general and administrative expenses as a percentage of product sales |
25.6% |
23.4% |
22.3% |
23.1% |
|||
Acquisition-related expenses (b) |
-0.4 |
-0.5 |
-0.4 |
-0.8 |
|||
Certain net charges pursuant to our restructuring initiative |
0.0 |
0.0 |
0.0 |
0.0 |
|||
Other |
0.0 |
0.0 |
0.0 |
0.0 |
|||
Non-GAAP selling, general and administrative expenses as a percentage of product sales |
25.2% |
22.9% |
21.9% |
22.3% |
|||
GAAP operating expenses |
$ 3,557 |
$ 3,480 |
$ 12,876 |
$ 13,197 |
|||
Adjustments to operating expenses: |
|||||||
Adjustments to cost of sales |
(243) |
(314) |
(1,126) |
(1,249) |
|||
Adjustments to research and development expenses |
(18) |
(22) |
(80) |
(85) |
|||
Adjustments to selling, general and administrative expenses |
(21) |
(26) |
(104) |
(185) |
|||
Certain net charges pursuant to our restructuring initiative (c) |
(27) |
(9) |
(83) |
(24) |
|||
Acquisition-related adjustments (d) |
(1) |
(3) |
(292) |
(4) |
|||
Expense related to legal proceedings |
- |
- |
- |
(105) |
|||
Total adjustments to operating expenses |
(310) |
(374) |
(1,685) |
(1,652) |
|||
Non-GAAP operating expenses |
$ 3,247 |
$ 3,106 |
$ 11,191 |
$ 11,545 |
|||
GAAP operating income |
$ 2,245 |
$ 2,485 |
$ 9,973 |
$ 9,794 |
|||
Adjustments to operating expenses |
310 |
374 |
1,685 |
1,652 |
|||
Non-GAAP operating income |
$ 2,555 |
$ 2,859 |
$ 11,658 |
$ 11,446 |
|||
GAAP operating income as a percentage of product sales |
40.3% |
43.9% |
45.8% |
44.7% |
|||
Adjustments to cost of sales |
4.3 |
5.5 |
5.2 |
5.7 |
|||
Adjustments to research and development expenses |
0.3 |
0.4 |
0.3 |
0.3 |
|||
Adjustments to selling, general and administrative expenses |
0.4 |
0.5 |
0.4 |
0.8 |
|||
Certain net charges pursuant to our restructuring initiative (c) |
0.6 |
0.2 |
0.4 |
0.2 |
|||
Acquisition-related adjustments (d) |
0.0 |
0.0 |
1.4 |
0.0 |
|||
Expense related to legal proceedings |
0.0 |
0.0 |
0.0 |
0.6 |
|||
Non-GAAP operating income as a percentage of product sales |
45.9% |
50.5% |
53.5% |
52.3% |
|||
GAAP income before income taxes |
$ 2,214 |
$ 2,283 |
$ 9,597 |
$ 9,163 |
|||
Adjustments to operating expenses |
310 |
374 |
1,685 |
1,652 |
|||
Non-GAAP income before income taxes |
$ 2,524 |
$ 2,657 |
$ 11,282 |
$ 10,815 |
|||
GAAP provision for income taxes |
$ 6,478 |
$ 348 |
$ 7,618 |
$ 1,441 |
|||
Adjustments to provision for income taxes: |
|||||||
Income tax effect of the above adjustments to operating expenses (e) |
98 |
113 |
538 |
525 |
|||
Other income tax adjustments (f) |
(6,156) |
36 |
(6,120) |
64 |
|||
Total adjustments to provision for income taxes |
(6,058) |
149 |
(5,582) |
589 |
|||
Non-GAAP provision for income taxes |
$ 420 |
$ 497 |
$ 2,036 |
$ 2,030 |
|||
GAAP tax as a percentage of income before taxes |
292.6% |
15.2% |
79.4% |
15.7% |
|||
Adjustments to provision for income taxes: |
|||||||
Income tax effect of the above adjustments to operating expenses (e) |
-32.1 |
2.1 |
-7.1 |
2.5 |
|||
Other income tax adjustments (f) |
-243.9 |
1.4 |
-54.3 |
0.6 |
|||
Total adjustments to provision for income taxes |
-276.0 |
3.5 |
-61.4 |
3.1 |
|||
Non-GAAP tax as a percentage of income before taxes |
16.6% |
18.7% |
18.0% |
18.8% |
|||
GAAP net (loss) income |
$ (4,264) |
$ 1,935 |
$ 1,979 |
$ 7,722 |
|||
Adjustments to net (loss) income: |
|||||||
Adjustments to income before income taxes, net of the income tax effect |
212 |
261 |
1,147 |
1,127 |
|||
Other income tax adjustments (f) |
6,156 |
(36) |
6,120 |
(64) |
|||
Total adjustments to net (loss) income |
6,368 |
225 |
7,267 |
1,063 |
|||
Non-GAAP net income |
$ 2,104 |
$ 2,160 |
$ 9,246 |
$ 8,785 |
Amgen Inc. |
|||||||
GAAP to Non-GAAP Reconciliations |
|||||||
(In millions, except per share data) |
|||||||
(Unaudited) |
|||||||
The following table presents the computations for GAAP and non-GAAP diluted EPS. |
|||||||
Three months ended |
Three months ended |
||||||
December 31, 2017 |
December 31, 2016 |
||||||
GAAP |
Non-GAAP |
GAAP |
Non-GAAP |
||||
Net (loss) income |
$ (4,264) |
$ 2,104 |
$ 1,935 |
$ 2,160 |
|||
Shares (Denominator) |
|||||||
Weight-average shares for basic EPS |
724 |
724 |
742 |
742 |
|||
Effect of dilutive securities |
- |
5 |
6 |
6 |
|||
Weighted-average shares for diluted EPS |
724 |
729 |
748 |
748 |
|||
Diluted (loss) earnings per share (g) |
$ (5.89) |
$ 2.89 |
$ 2.59 |
$ 2.89 |
|||
Year ended |
Year ended |
||||||
December 31, 2017 |
December 31, 2016 |
||||||
GAAP |
Non-GAAP |
GAAP |
Non-GAAP |
||||
Net income |
$ 1,979 |
$ 9,246 |
$ 7,722 |
$ 8,785 |
|||
Shares (Denominator) |
|||||||
Weight-average shares for basic EPS |
731 |
731 |
748 |
748 |
|||
Effect of dilutive securities |
4 |
4 |
6 |
6 |
|||
Weighted-average shares for diluted EPS |
735 |
735 |
754 |
754 |
|||
Diluted EPS |
$ 2.69 |
$ 12.58 |
$ 10.24 |
$ 11.65 |
(a) |
The adjustments related primarily to non-cash amortization of intangible assets acquired in business combinations. |
(b) |
The adjustments related primarily to non-cash amortization of intangible assets acquired in business combinations. For the year ended December 31, 2016, the adjustment also included a $73 million charge resulting from the reacquisition of Prolia®, XGEVA® and Vectibix® license agreements in certain markets from Glaxo Group Limited. |
(c) |
For the three months and year ended December 31, 2017, the adjustments related primarily to severance expenses associated with our restructuring initiative. For the three months and year ended December 31, 2016, the adjustments related primarily to asset-related charges associated with our site closures. |
(d) |
For the year ended December 31, 2017, the adjustment included net charges associated with the discontinuance of the internal development of AMG 899. |
(e) |
The tax effect of the adjustments between our GAAP and non-GAAP results takes into account the tax treatment and related tax rate(s) that apply to each adjustment in the applicable tax jurisdiction(s). Generally, this results in a tax impact at the U.S. marginal tax rate for certain adjustments, including the majority of amortization of intangible assets, whereas the tax impact of other adjustments, including restructuring expense, depends on whether the amounts are deductible in the respective tax jurisdictions and the applicable tax rate(s) in those jurisdictions. Due to these factors, the effective tax rates for the adjustments to our GAAP income before income taxes, for the three months and year ended December 31, 2017, were 31.6% and 31.9%, respectively, compared with 30.2% and 31.8% for the corresponding periods of the prior year. |
(f) |
For the three months and year ended December 31, 2017, the adjustments related primarily to the impact of U.S. Corporate tax reform, including the repatriation tax on accumulated foreign earnings and the remeasurement of certain net deferred and other tax liabilities. For the three months and year ended December 31, 2016, the adjustments related to certain acquisition items and prior period items excluded from GAAP earnings. |
(g) |
During periods of net loss, diluted loss per share is equal to basic loss per share as the anti-dilutive effect of potential common shares is disregarded. |
Amgen Inc. |
|||||||||
Reconciliations of Cash Flows |
|||||||||
(In millions) |
|||||||||
(Unaudited) |
|||||||||
Three months ended |
Years ended |
||||||||
December 31, |
December 31, |
||||||||
2017 |
2016 |
2017 |
2016 |
||||||
Net cash provided by operating activities |
$ 3,012 |
$ 3,100 |
$ 11,177 |
$ 10,354 |
|||||
Net cash used in investing activities |
(78) |
(1,222) |
(4,024) |
(8,658) |
|||||
Net cash used in financing activities |
(2,134) |
(2,122) |
(6,594) |
(2,599) |
|||||
Increase (decrease) in cash and cash equivalents |
800 |
(244) |
559 |
(903) |
|||||
Cash and cash equivalents at beginning of period |
3,000 |
3,485 |
3,241 |
4,144 |
|||||
Cash and cash equivalents at end of period |
$ 3,800 |
$ 3,241 |
$ 3,800 |
$ 3,241 |
|||||
Three months ended |
Years ended |
||||||||
December 31, |
December 31, |
||||||||
2017 |
2016 |
2017 |
2016 |
||||||
Net cash provided by operating activities |
$ 3,012 |
$ 3,100 |
$ 11,177 |
$ 10,354 |
|||||
Capital expenditures |
(153) |
(227) |
(664) |
(738) |
|||||
Free cash flow |
$ 2,859 |
$ 2,873 |
$ 10,513 |
$ 9,616 |
Reconciliation of GAAP EPS Guidance to Non-GAAP |
||||||
EPS Guidance for the Year Ending December 31, 2018 |
||||||
(Unaudited) |
||||||
GAAP diluted EPS guidance |
$ 11.18 |
- |
$ 12.36 |
|||
Known adjustments to arrive at non-GAAP*: |
||||||
Acquisition-related expenses |
(a) |
1.31 |
||||
Restructuring charges |
0.03 |
- |
0.11 |
|||
Non-GAAP diluted EPS guidance |
$ 12.60 |
- |
$ 13.70 |
|||
* |
The known adjustments are presented net of their related tax impact which amount to approximately $0.40 per share, in the aggregate |
(a) |
The adjustments relate primarily to non-cash amortization of intangible assets acquired in business combinations |
Our GAAP diluted EPS guidance does not include the effect of non-GAAP adjustments triggered by events that may occur subsequent to this press release such as acquisitions, asset impairments, litigation and changes in the fair value of our contingent consideration |
|
Reconciliation of GAAP Tax Rate Guidance to Non-GAAP |
||||||
Tax Rate Guidance for the Year Ending December 31, 2018 |
||||||
(Unaudited) |
||||||
2018 |
||||||
GAAP tax rate guidance |
13.0% |
- |
14.0% |
|||
Tax rate effect of known adjustments discussed above |
1.0% |
|||||
Non-GAAP tax rate guidance |
14.0% |
- |
15.0% |
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