Upgrade to full year 2024 guidance underpinned by strong underlying growth momentum
AstraZeneca:
Revenue and EPS summary
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|
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9M 2024
|
% Change
|
|
Q3 2024
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% Change
|
|
|
$m
|
Actual
|
CER1
|
|
$m
|
Actual
|
CER
|
|
- Product Sales
|
|
37,576
|
16
|
19
|
|
12,947
|
18
|
20
|
|
- Alliance Revenue
|
|
1,498
|
49
|
50
|
|
559
|
48
|
50
|
|
- Collaboration Revenue
|
|
108
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(66)
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(66)
|
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59
|
(39)
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(40)
|
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Total Revenue
|
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39,182
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16
|
19
|
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13,565
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18
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21
|
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Reported EPS
|
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$3.57
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11
|
21
|
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$0.92
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4
|
17
|
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Core2 EPS
|
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$6.12
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5
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11
|
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$2.08
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20
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27
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Financial performance for 9M 2024 (Growth numbers at constant exchange rates)
- Total Revenue up 19% to $39,182m, driven by a 19% increase in Product Sales and continued growth in Alliance Revenue from partnered medicines
- Total Revenue growth from Oncology was 22%, CVRM 21%, R&I 24% and Rare Disease 14%
- Core Product Sales Gross Margin3 of 82%
- Core Operating Margin of 32%
- Core Tax Rate of 20%
- Core EPS increased 11% to $6.12. In the prior year period, Core EPS included gains totalling $953m from the disposal of Pulmicort Flexhaler US rights and updated contractual arrangements for Beyfortus
- Guidance for FY 2024 Total Revenue and Core EPS growth at CER upgraded to high teens percentage growth
Pascal Soriot, Chief Executive Officer, AstraZeneca, said:
"Our company has continued on its strong growth trajectory in the first nine months of 2024. Total Revenue and Core EPS were up 21% and 27% respectively in the third quarter, reflecting the increasing demand for our medicines across Oncology, BioPharmaceuticals and Rare Disease and supporting an upgrade to our full year 2024 guidance.
In the year to date we have announced the results for multiple positive high-value trials and are working to bring these new options to patients as quickly as possible. Additionally, the quality and impact of our scientific research was well recognised this quarter with data for AstraZeneca medicines featuring in an unprecedented five Presidential Plenary sessions at the two major oncology conferences in September.
We are highly encouraged by the broad-based underlying momentum we are seeing across our company in 2024, and growth looks set to continue through 2025, providing a solid foundation to deliver on our 2030 ambition.
Finally, we take the matters in China very seriously. If requested we will fully cooperate with the authorities. We remain committed to delivering innovative life-changing medicines to patients in China."
Key milestones achieved since the prior results announcement
- Positive read-outs for Tagrisso plus Orpathys in EGFRm NSCLC with high levels of MET overexpression and/or amplification (SAVANNAH), Calquence in combination with venetoclax, with or without obinutuzumab in previously untreated CLL (AMPLIFY), and the next generation propellant for Breztri. Koselugo in adult patients with NF1-PN (KOMET), Tezspire in severe chronic rhinosinusitis with nasal polyps (WAYPOINT)
- US approvals for Tagrisso in unresectable, Stage III EGFRm NSCLC (LAURA) and Imfinzi plus chemotherapy in resectable early-stage NSCLC (AEGEAN) and FluMist for self-administration. EU approvals for Imfinzi plus chemotherapy followed by Imfinzi alone in mismatch repair deficient endometrial cancer (DUO-E), Imfinzi plus chemotherapy followed by Lynparza and Imfinzi in mismatch repair proficient endometrial cancer (DUO-E) and Fasenra for EGPA (MANDARA). China approvals for Enhertu in unresectable, locally advanced or metastatic HER2-mutated NSCLC (DESTINY-Lung02, DESTINY-Lung05), Enhertu in locally advanced or metastatic HER2-positive gastric or gastroesophageal junction adenocarcinoma (DESTINY-Gastric06), and Fasenra for severe eosinophilic asthma (MIRACLE)
Guidance
Given the strength of underlying Product Sales and Alliance Revenue, as well as increased confidence in achieving certain sales-based milestones, the Company raises its Total Revenue and Core EPS guidance for FY 2024 at CER.
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Total Revenue is expected to increase by a high teens percentage (previously a mid teens percentage)
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Core EPS is expected to increase by a high teens percentage (previously a mid teens percentage)
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- Other elements of the Income Statement are expected to be broadly in-line with the indications issued in the Company's H1 2024 earnings statement
The Company is unable to provide guidance on a Reported basis because it cannot reliably forecast material elements of the Reported results, including any fair value adjustments arising on acquisition-related liabilities, intangible asset impairment charges and legal settlement provisions. Please refer to the cautionary statements section regarding forward-looking statements at the end of this announcement.
Currency impact
If foreign exchange rates for October 2024 to December 2024 were to remain at the average rates seen in September 2024, it is anticipated that FY 2024 Total Revenue would incur a low single-digit percentage adverse impact compared to the performance at CER (unchanged from previous guidance), and Core EPS would incur a mid single-digit percentage adverse impact (unchanged from previous guidance). The Company's foreign exchange rate sensitivity analysis is provided in Table 17.
China
As previously disclosed, the Company is aware of a number of individual investigations by the Chinese authorities into current and former AstraZeneca employees. To the best of the Company's knowledge, the investigations include allegations of medical insurance fraud, illegal drug importation and personal information breaches. Recently Leon Wang, EVP International and AstraZeneca China President was detained. The Company has not received any notification that it is itself under investigation. If requested, AstraZeneca will fully cooperate with the Chinese authorities.
Table 1: Key elements of Total Revenue performance in Q3 2024
|
|
|
% Change
|
|
|
|
|
|
Revenue type
|
|
$m
|
Actual %
|
CER %
|
|
|
|
|
|
Product Sales
|
|
12,947
|
18
|
20
|
|
|
|
|
|
Alliance Revenue
|
|
559
|
48
|
50
|
|
* $49m Beyfortus (Q3 2023: $17m)
* $361m Enhertu (Q3 2023: $266m)
* $123m Tezspire (Q3 2023: $74m)
|
|
|
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Collaboration Revenue
|
|
59
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(39)
|
(40)
|
|
* $56m Beyfortus (Q3 2023: $71m)
|
|
|
|
Total Revenue
|
|
13,565
|
18
|
21
|
|
|
|
|
|
Therapy areas
|
|
$m
|
Actual %
|
CER %
|
|
|
|
|
|
Oncology
|
|
5,569
|
19
|
22
|
|
* Tagrisso up 14% (17% at CER), Calquence up 24% (25% at CER), Enhertu Total Revenue up 50% (55% at CER)
|
|
|
|
CVRM
|
|
3,159
|
18
|
20
|
|
* Farxiga up 25% (27% at CER),Lokelma up40%(42% at CER)
|
|
|
|
R&I
|
|
1,959
|
26
|
29
|
|
* Breztri up 56% (57% at CER). Saphnelo up 63% (64% at CER), Tezspire up >2x, Symbicort up 27% (31% CER)
|
|
|
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V&I
|
|
460
|
48
|
49
|
|
* Beyfortus Total Revenue up 73% (72% at CER), FluMist up 34% (31% at CER)
|
|
|
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Rare Disease
|
|
2,148
|
9
|
11
|
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* Ultomiris up 33% (35% at CER), partially offset by decline in Soliris of 22% (18% at CER), Strensiq up 20% (21% at CER) and Koselugo up 37% (39% at CER)
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|
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Other Medicines
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|
270
|
(12)
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(8)
|
|
|
|
|
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Total Revenue
|
|
13,565
|
18
|
21
|
|
|
|
|
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Regions
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$m
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Actual %
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CER %
|
|
|
|
|
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US
|
|
6,008
|
23
|
23
|
|
|
|
|
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Emerging Markets
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3,423
|
15
|
23
|
|
|
|
|
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- China
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1,671
|
15
|
15
|
|
|
|
|
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- Ex-China Emerging Markets
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1,752
|
16
|
31
|
|
|
|
|
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Europe
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2,875
|
22
|
22
|
|
|
|
|
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Established RoW
|
|
1,260
|
(1)
|
4
|
|
|
|
|
|
Total Revenue
|
|
13,565
|
18
|
21
|
|
|
|
|
|
|
|
|
|
|
|
|
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Key alliance medicines
- Combined sales of Enhertu, recorded by Daiichi Sankyo Company Limited (Daiichi Sankyo) and AstraZeneca, amounted to $2,729m in 9M 2024 (9M 2023: $1,844m).
- Combined sales of Tezspire, recorded by Amgen and AstraZeneca, amounted to $843m in 9M 2024 (9M 2023: $438m).
Table 2: Key elements of financial performance in Q3 2024
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Metric
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Reported
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Reported change
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Core
|
Core
change
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|
Comments4
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|
Total Revenue
|
$13,565m
|
18% Actual 21% CER
|
$13,565m
|
18% Actual 21% CER
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|
* See Table 1 and the Total Revenue section of this document for further details
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|
Product Sales Gross Margin
|
76%
|
-5pp Actual -4pp CER
|
81%
|
Stable Actual and CER
|
|
* Variations in Product Sales Gross Margin can be expected between periods, due to product seasonality (e.g. FluMist and Beyfortus sales are weighted to the second half of the year), foreign exchange fluctuations and other effects
‒ Reported Product Sales Gross Margin impacted by PAAGR5 inventory related restructuring charges taken in the quarter
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|
R&D
expense
|
$3,115m
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21% Actual 21% CER
|
$3,068m
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23% Actual 24% CER
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+ Increased investment in the pipeline
* Core R&D-to-Total Revenue ratio of 23%
(Q3 2023: 22%)
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SG&A expense
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$5,143m
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7% Actual 8% CER
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$3,605m
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8% Actual 9% CER
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+ Market development for recent launches and pre-launch activities
* Core SG&A-to-Total Revenue ratio of 27%
(Q3 2023: 29%)
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|
Other operating income and expense6
|
$25m
|
-65% Actual -61% CER
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$24m
|
-65% Actual -61% CER
|
|
|
|
Operating Margin
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16%
|
-1pp Actual Stable CER
|
32%
|
+1pp Actual +2pp CER
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* See commentary above on Gross Margin, R&D, SG&A and Other operating income and expense
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Net finance expense
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$274m
|
-6% Actual -15% CER
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$329m
|
46% Actual 35% CER
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+ New debt issued at higher interest rates
+ Higher level of Net debt
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Tax rate
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22%
|
+5pp Actual +5pp CER
|
19%
|
Stable Actual and CER
|
|
* Variations in the tax rate can be expected between periods
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EPS
|
$0.92
|
4% Actual 17% CER
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$2.08
|
20% Actual 27% CER
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* Further details of differences between Reported and Core are shown in Table 12
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Table 3: Pipeline highlights since prior results announcement
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Event
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Medicine
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Indication / Trial
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Event
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|
Regulatory approvals and other regulatory actions
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Tagrisso
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Unresectable, Stage III EGFRm NSCLC (LAURA)
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Regulatory approval (US)
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Imfinzi
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Primary advanced or recurrent endometrial cancer with mismatch repair deficiency (DUO-E)
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Regulatory approval (EU)
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Imfinzi + Lynparza
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Primary advanced or recurrent endometrial cancer with mismatch repair proficiency (DUO-E)
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Regulatory approval (EU)
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Imfinzi
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Resectable early-stage (IIA-IIIB) NSCLC (AEGEAN)
|
Regulatory approval (US)
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|
Enhertu
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Locally advanced or metastatic HER2-positive gastric or gastroesophageal junction adenocarcinoma (DESTINY-Gastric06)
|
Regulatory approval (CN)
|
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Enhertu
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Unresectable locally advanced or metastatic HER2m NSCLC (DESTINY-Lung02, DESTINY-Lung05)
|
Regulatory approval (CN)
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Fasenra
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EGPA (MANDARA)
|
Regulatory approval (US, EU)
|
|
Fasenra
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Fasenra (MIRACLE)
|
Regulatory approval (CN)
|
|
FluMist
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Self-administration
|
Regulatory approval (US)
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|
Regulatory submissions
or acceptances*
|
Tagrisso
|
EGFRm NSCLC (Stage III
unresectable) (LAURA)
|
Regulatory submission (EU, JP, CN)
|
|
Imfinzi
|
Muscle-invasive bladder
Cancer (NIAGARA)
|
Regulatory submission (EU)
|
|
Imfinzi
|
NSCLC (neoadjuvant) AEGEAN
|
Regulatory submission (JP)
|
|
Imfinzi
|
SCLC (limited stage) (ADRIATIC)
|
Regulatory submission (US, EU, JP, CN)
|
|
Calquence
|
Mantle cell lymphoma (1st-line) (ECHO)
|
Regulatory submission (US, EU, JP)
|
|
Calquence
|
CLL (ELEVATE-TN)
|
Regulatory submission (CN)
|
|
Lynparza
|
mCRPC (PROpel)
|
Regulatory submission (CN)
|
|
Enhertu
|
HER2-low breast cancer
(2nd-line) (DESTINY-Breast06)
|
Regulatory submission (US, EU, JP)
|
|
Wainua
|
Hereditary transthyretin-mediated amyloid polyneuropathy (NEURO-TTRansform)
|
Regulatory submission (CN)
|
|
Breztri and HFO1234ze
|
Moderate to severe COPD
|
Regulatory submission (EU)
|
|
Sipavibart
|
Prevention of COVID-19
(SUPERNOVA)
|
Regulatory submission (JP)
|
|
Ultomiris
|
NMOSD (CHAMPION-NMOSD)
|
Regulatory submission (CN)
|
|
Phase III / registrational data readouts and other developments
|
Tagrisso + Orpathys
|
EGFRm NSCLC with high levels of MET overexpression and/or amplification (SAVANNAH)
|
Clinically meaningful ORR
|
|
Calquence fixed duration
|
Chronic lymphocytic leukaemia (AMPLIFY)
|
Primary endpoint met
|
|
Fasenra
|
Eosinophilic chronic rhinosinusitis with nasal polyps (ORCHID)
|
Primary endpoint not met
|
|
Tezspire
|
Severe chronic rhinosinusitis with nasal polyps (WAYPOINT)
|
Primary endpoint met
|
|
Koselugo
|
Adults with NF1-PN (KOMET)
|
Primary endpoint met
|
*US, EU and China regulatory submission denotes filing acceptance
Upcoming pipeline catalysts
For recent trial starts and anticipated timings of key trial readouts, please refer to the Clinical Trials Appendix, available on www.astrazeneca.com/investor-relations.html.
Corporate and business development
In October 2024, AstraZeneca entered into an exclusive license agreement with CSPC Pharmaceutical Group Ltd (CSPC) to advance the development of an early stage, novel small molecule Lipoprotein (a) (Lp(a)) disruptor that has the potential to offer additional benefits for patients with dyslipidaemia. This further strengthens the company's cardiovascular portfolio to help address the major risk factors driving chronic cardiovascular disease. Under the terms of the agreement, AstraZeneca will receive access to CSPC's pre-clinical candidate small molecule, YS2302018, an oral Lp(a) disruptor, with the aim of developing this as a novel lipid-lowering therapy with potential in a range of cardiovascular disease indications alone or in combination, including with AstraZeneca's oral small molecule PCSK9 inhibitor, AZD0780. CSPC will receive an upfront payment of $100 million from AstraZeneca. CSPC is also eligible to receive up to $1.92 billion for further development and commercialisation milestones plus tiered royalties.
In October 2024, AstraZeneca entered into an agreement to out-license ALXN1840 (bis-choline tetrathiomolybdate), a drug candidate for Wilson disease to Monopar Therapeutics Inc (Monopar). Monopar will be responsible for all future global development and commercialisation activities. AstraZeneca will have a 9.9% beneficial ownership interest in Monopar upon issuance as well as an upfront cash payment of $4.0 million. AstraZeneca is also eligible to receive milestones and royalties.
Sustainability highlights
In September, AstraZeneca had a significant presence at Climate Week NYC and the 79th Session of the UN General Assembly in New York, with a delegation led by Pam Cheng, Executive Vice President of Global Operations and IT and Chief Sustainability Officer and the company's US leadership. A programme of more than 50 engagements with governments, media, NGOs and the private sector focused on the interconnected issues of the climate crisis, health equity and health system resilience and the Company's commitment to contribute to more sustainable, resilient and equitable health systems.
Conference call
A conference call and webcast for investors and analysts will begin today, 12 November 2024, at 14:00 UK time. Details can be accessed via astrazeneca.com.
Reporting calendar
The Company intends to publish its FY and Q4 2024 results on 6 February 2025.
To read AstraZeneca's 9M and Q3 2024 Financial Results press release in full including the glossary, please click here.
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_____________________
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| 1 |
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Constant exchange rates. The differences between Actual Change and CER Change are due to foreign exchange movements between periods in 2024 vs. 2023. CER financial measures are not accounted for according to generally accepted accounting principles (GAAP) because they remove the effects of currency movements from Reported results.
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| 2 |
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Core financial measures are adjusted to exclude certain items. The differences between Reported and Core measures are primarily due to costs relating to the amortisation of intangibles, impairments, legal settlements and restructuring charges. A full reconciliation between Reported EPS and Core EPS is provided in Table 11 and Table 12 in the Financial performance section of this document.
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| 3 |
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The calculations for Reported and Core Product Sales Gross Margin exclude the impact of Alliance Revenue and Collaboration Revenue.
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| 4 |
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In Table 2, the plus and minus symbols denote the directional impact of the item being discussed, e.g. a ‘+’ symbol next to a comment related to the R&D expense indicates that the item resulted in an increase in the R&D spend relative to the prior year.
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| 5 |
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Post Alexion Acquisition Group Review. In conjunction with the acquisition of Alexion, the Post Alexion Acquisition Group Review Group initiated a comprehensive review, aimed at integrating systems, structure and processes, optimising the global footprint and prioritising resource allocations and investments. These activities are expected to be substantially complete by the end of 2026.
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| 6 |
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Income from disposals of assets and businesses, where the Group does not retain a significant ongoing economic interest, continue to be recorded in Other operating income and expense in the Company’s financial statements.
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