Teva Pharmaceutical Industries Ltd. (NYSE: TEVA; TASE: TEVA) has reported its financial results for the first quarter of 2020. The Israeli pharmaceutical company reported strong results for the first quarter, which was only affected by the Covid-19 crisis only in the final few weeks of the quarter. Despite the crisis, Teva has kept its overall 2020 guidance unchanged at revenue of $16.6 - 17 billion and non-GAAP earnings per share of $2.30 - 2.55.
Teva has also reduced its net debt to $24.3 billion and cash flow generated from operating activities during the first quarter of 2020 was $305 million, up from $112 million in the first quarter of 2019.
The company's share price is up 8.3% in pre-market trading on Wall Street at $11.35.
Revenue in the first quarter of 2020 was $4.357 billion, up 5% in both US dollar and local currency terms, from the first quarter of 2019. Revenue was $210 million above the analysts' consensus.
GAAP net profit was $69 million ($0.06 per share) in the first quarter of 2020, compared with GAAP net loss of $105 million in the first quarter of 2019. Non-GAAP net profit in the first quarter of 2020 was $835 million ($0.76 per share) (above the analysts' consensus of $0.59 per share), compared with $654 million ($0.60 per share) in the first quarter of 2019.
The increase in non-GAAP net income and EPS is mainly due to Teva's higher profit in the Europe, International Markets and North America segments and the economic hedging activities and lower operating expenses, primarily related to the Covid-19 pandemic, partially offset by higher non-GAAP taxes compared to the first quarter of 2019.
This increase was mainly due to higher revenue from generics and OTC sales in Europe, higher revenue from Austedo and Anda in North America and higher revenue from Teva's International Markets segment, partially offset by lower revenues from generics in the US and lower revenues from Qvar and Bendeka/Treanda in North America.
Branded drug sales in North America rose 2% in the first quarter to $2.082 billion from $2.047 billion in the corresponding quarter of 2019. Copaxone sales only fell 5% to $198 million from $208 million in the first quarter of 2019. Quar revenue fell 29% to $45 million and Bendeka/Treanda revenue fell 14% to $105 million. Revenue from Austedo rose 64% to $122 million and revenue from Ajovy rose 44% to $29 million.
Teva president and CEO Kåre Schultz said, "2020 brought an unprecedented global health crisis, affecting all nations and industries, including the pharmaceutical industry, which plays many roles in countering the epidemic. As our industry responds to the challenge, we are reminded of the importance of reliable supplies of high quality generic medicines to meet critical demand. Teva has responded to this challenge by supporting efforts of governments and health services to curb the impact of the virus. We have done this while taking robust measures to safeguard the health and well-being of our employees, who have diligently worked to ensure that all our manufacturing and distribution facilities remain open to allow the safe supply of medicines and APIs to our customers, and to millions of patients around the world."
He continued, "Our very strong results during the first quarter of 2020 were impacted by greater demand in our major markets for generic and OTC products and respiratory products. Stronger revenues across these categories, along with growth in our operating and net profit, contributed to strong free cash flow and a further reduction in our net debt to $24.3 billion."
"Looking ahead, in light of the challenges and uncertainties facing our industry and society at large, we will continue to take measures to safeguard our dedicated employees, securing continued operation of our supply chain and deliveries of our broad portfolio to the 200 million patients we serve."
Published by Globes, Israel business news - www.globes-online.com - on May 7, 2020
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