NYSE$ELAN

Elanco Animal Health Inc · Q4 2022 earnings

Q4 2022 earnings · · Investor relations

Briefing

Elanco's Q4 2022 results demonstrated dedication to the IPP strategy, with significant advancements in innovation pipeline and productivity gains.

Elanco Animal Health reported a revenue decrease of 11% in Q4 2022, but delivered operating cost discipline, contributing to an Adjusted EBITDA margin expansion of 90 basis points for the year. The company delivered expected submissions for two pet health potential blockbusters and added eight product approvals in major markets.

  • Revenue was $988 million, an 11% decrease compared to Q4 2021.
  • Pet Health revenue decreased by 14% to $423 million.
  • Farm Animal revenue decreased by 9% to $552 million.
  • Adjusted EBITDA was $174 million, a 19% decrease compared to Q4 2021.

Headline financials

Total Revenue

$988M

Previous: $1.11B-11.2%
EPS (adj)

$0.19

Previous: $0.21-9.5%
Capital Expenditures

$66M

Previous: $66M+0.0%
Free Cash Flow

-$53M

Previous: $223M-123.8%
Net Income

-$54M

Previous: -$97M+44.3%
Operating Income

$157M

Previous: $180M-12.8%
Gross Profit

$540M

Previous: $601M-10.1%
Cash & Equivalents

$443M

Previous: $638M-30.5%
Total Assets

$17.8B

Previous: $16.5B+8.3%
Stock-Based Comp

$15M

Previous: $18M-16.7%

Revenue & EPS history

Elanco · Revenue · Quarterly

$988M

Q4 2022-11.2%vs Q4 2021
Beat estimate in 10 of 15 quarters(67%)
ActualEstimate

Revenue by segment

Elanco · $808M total across 4 segments · Q4 2022

  • Pet Health
    $423M
  • Cattle
    $190M
  • Swine
    $101M
  • Poultry
    $94M

Forward guidance

Elanco is providing financial guidance for the full year 2023, anticipating revenue between $4,280 million and $4,400 million. For the first half of 2023, revenue is expected to be between $2.23 billion and $2.31 billion.

Tailwinds

  • Accelerating growth from innovation products
  • Increased price
  • Improving dynamics in China
  • Successfully executing systems integration
  • Enhancing commercial excellence

Headwinds

  • Continued pressure from competitive innovation in the U.S. pet health veterinary market
  • Economic weakness in Europe and U.S.
  • Impact on pet retail markets
  • Headwind of approximately $10 million to $15 million from the unfavorable impact of foreign exchange rates compared to prior year (FY)
  • Shift of approximately $40 million to $80 million in revenue into the first quarter of 2023 from what otherwise would have been expected in the second quarter of 2023 due to ERP system go-live in April 2023

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2022

Historical avgQ4 2022

+2.0%

Avg return

Earnings day

+2.8%

Avg return

5 days after

+1.1%

Avg return

30 days after

52%

16 / 31 earnings

Positive

+27.2%

Q1 2024

Best reaction

-16.3%

Q2 2021

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+13.9%-5.6%+2.6%
Q4 2025+7.3%+6.7%-0.7%
Q3 2025-4.2%-1.0%-2.7%
Q1 2025+26.2%+34.8%+46.2%
Q4 2024-3.7%+0.5%-2.7%
Q3 2024+9.4%+9.8%-2.8%
Q2 2024+5.3%+12.6%+21.9%
Q1 2024+27.2%+25.7%+34.7%
Q4 2023+0.5%-2.1%-1.2%
Q3 2023+15.9%+14.1%+36.4%
Q2 2023+7.0%+4.5%+2.7%
Q1 2023-3.8%-8.4%-0.1%
Q4 2022-6.9%-11.0%-33.1%
Q3 2022-10.3%+0.4%-6.7%
Q2 2022-1.6%+3.3%-23.9%
Q1 2022-7.9%-6.4%+1.5%
Q4 2021+8.2%+12.4%+3.3%
Q3 2021+1.2%+0.3%-14.3%
Q2 2021-16.3%-12.3%-4.2%
Q1 2021+3.8%+3.4%+10.1%
Q4 2020+2.8%+9.0%-9.8%
Q3 2020-4.7%-8.0%-9.8%
Q2 2020+11.7%+17.3%+37.7%
Q1 2020-13.5%-12.9%+3.6%
Q4 2019-0.7%-1.4%-42.5%
Q3 2019-1.9%-3.1%-1.2%
Q2 2018-4.8%-1.3%-4.6%
Q2 2019-4.8%-1.3%-4.6%
Q1 2019+6.1%+3.9%+4.1%
Q4 2018-2.4%-1.7%-2.7%
Q3 2018+3.7%+3.7%-1.9%
Q1 2018
Q4 2017
Q3 2017
Q2 2017
Q1 2017

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