THIRD QUARTER AND NINE MONTHS RESULTS 2011
Revenue for the third quarter declined by 2 percent at constant exchange rates (CER) to $8,213 million.
-Strong revenue growth for Crestor, Seroquel XR and Symbicort.
-Revenue performance reflects the loss of more than $350 million of revenue from generic competition, as well as the impact of government price interventions.
-Emerging Markets revenue increased by 7 percent at CER in the third quarter; revenue was up 10 percent for the nine months.
Core operating profit in the third quarter was $3,177 million, down 2 percent at CER, in line with the decline in revenue.
-Core operating margin of 38.7 percent of revenue was down 0.3 percentage points at CER, as increased investment in Research and Development was largely offset by higher gross margin and lower SG&A expense as a percentage of revenue.
Core EPS in the third quarter was up 12 percent at CER to $1.71.
-Core EPS benefited from the lower number of shares outstanding resulting from net share repurchases and a lower tax rate compared with the third quarter last year.
Reported EPS in the third quarter was up 140 percent at CER to $2.56.
-Gain on the sale of Astra Tech, which was excluded from Core EPS, amounted to $1.08 in the third quarter 2011. Third quarter 2010 included legal provisions of $0.24, which also benefited the growth rate for Reported EPS in the third quarter 2011.
Net cash distributions to shareholders for the nine months increased by 64 percent to $7,642 million.
Core EPS target for the full year increased to the range of $7.20 to $7.40, largely on currency movements.
Financial Summary
| Group | 3rd Quarter 2011 $m |
3rd Quarter 2010 $m |
Actual % |
CER % |
9 Months 2011 $m |
9 Months 2010 $m |
Actual % |
CER % |
|
| Revenue | 8,213 | 7,898 | +4 | -2 | 24,935 | 24,652 | +1 | -3 | |
| Reported | |||||||||
| Operating Profit | 4,262 | 2,406 | +77 | +78 | 10,628 | 9,083 | +17 | +16 | |
| Profit before Tax | 4,169 | 2,258 | +85 | +86 | 10,315 | 8,694 | +19 | +18 | |
| Earnings per Share | $2.56 | $1.08 | +137 | +140 | $6.17 | $4.45 | +39 | +38 | |
| Core* | |||||||||
| Operating Profit | 3,177 | 3,231 | -2 | -2 | 10,177 | 10,738 | -5 | -6 | |
| Profit before Tax | 3,084 | 3,083 | - | -1 | 9,864 | 10,349 | -5 | -5 | |
| Earnings per Share | $1.71 | $1.50 | +14 | +12 | $5.67 | $5.32 | +7 | +6 | |
| * | Core financial measures are supplemental non-GAAP measures which management believe enhance understanding of the Company’s performance; it is upon these measures that financial guidance for 2011 is based. See pages 10 and 11 for a definition of Core financial measures and a reconciliation of Core to Reported financial measures. |
David Brennan, Chief Executive Officer, said: “We have delivered a third quarter revenue and Core earnings performance in line with our expectations, against the backdrop of anticipated generic competition and government price interventions. Our disciplined execution continues to generate strong cash returns, with dividends and net share repurchases well ahead of last year. We have also increased our Core EPS target for the full year.”
| Media Enquiries: | Esra Erkal-Paler (London) | +44 20 7604 8030 |
| Abigail Baron (London) | +44 20 7604 8034 | |
| Tony Jewell (Wilmington) | +1 302 885 4594 | |
| Ann-Leena Mikiver (Södertälje) | +46 8 553 260 20/+46 707 428836 | |
| Analyst/Investor Enquiries: | Karl Hård (London) | +44 20 7604 8123 |
| Nicklas Westerholm (London) | +44 20 7604 8124 | |
| Ed Seage/Jörgen Winroth (US) | +1 302 886 4065/+1 212 579 0506 |
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